[FORUM LOGO]
F O R U M
F U N D S
[PICTURE GRAPHICS ON LEFT HALF
OF PAGE OF COMPUTER MONITOR AND
KEYBOARD ON PEDISTAL, PENCIL,
PAPER, GEAR WHEELS]
SEMI-ANNUAL REPORT
FEBRUARY 28, 1998
DAILY ASSETS
TREASURY FUND
DAILY ASSETS TREASURY
OBLIGATIONS FUND
DAILY ASSETS
GOVERNMENT FUND
DAILY ASSETS
CASH FUND
<PAGE>
TABLE OF CONTENTS
A Message to our Shareholders..................................... 1
FINANCIAL STATEMENTS OF FORUM FUNDS
Statements of Assets and Liabilities.............................. 2
Statements of Operations.......................................... 3
Statements of Changes in Net Assets............................... 4
Financial Highlights.............................................. 6
Notes to Financial Statements..................................... 8
FINANCIAL STATEMENTS OF CORE TRUST (DELAWARE)
Schedules of Investments:
Treasury Portfolio.......................................... 15
Treasury Cash Portfolio..................................... 16
Government Cash Portfolio................................... 17
Cash Portfolio.............................................. 18
Statements of Assets and Liabilities.............................. 19
Statements of Operations.......................................... 20
Statements of Changes in Net Assets............................... 21
Notes to Financial Statements..................................... 23
<PAGE>
FORUM FUNDS
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[FORUM LOGO]
DAILY ASSETS TREASURY FUND
DAILY ASSETS TREASURY OBLIGATIONS FUND
DAILY ASSETS GOVERNMENT CASH FUND
DAILY ASSETS CASH FUND
SEMI-ANNUAL REPORT
- --------------------------------------------------------------------------------
Dear Shareholder:
The management of Forum Funds is pleased to present this semi-annual report to
shareholders for the period ended February 28, 1998. We are delighted to report
that our money market fund offerings have been expanded and are receiving an
excellent response from shareholders. We begin by updating you on some exciting
changes in the investment advisor to the funds, and on our new funds.
As a shareholder you have been familiar with Linden Asset Management, Inc., and
Forum Advisors, Inc., the investment advisors to the Daily Asset Cash and Daily
Assets Treasury portfolios respectively. As of January 2, 1998, the operations
of these two companies have been combined to form Forum Investment Advisors,
LLC. Anthony Fischer, former principal of Linden, is now the portfolio manager
for all of Forum Investment Advisors' money market funds, including the Daily
Assets Treasury Fund portfolio. We are pleased with the acquisition of Linden
Asset Management and the opportunity to continue to benefit from Mr.
Fischer's experience. We are confident that the combination will result in new
growth.
Signs of that growth are evident in the cover of this semi-annual report: as of
November, 1997, we opened two new money market funds, the Daily Assets Treasury
Obligations Fund and the Daily Assets Government Fund. As of the date of this
report the Treasury Obligations Fund had total net assets of more than $60
million and the Government fund had nearly $5 million in total net assets. We
should also note that Standard & Poor's has given Daily Assets Treasury
Obligations Fund its highest money market fund rating: AAAm. We are pleased to
provide these new investment opportunities to shareholders and happy with their
successful introduction. The four money market funds discussed in this report
now have combined assets in excess of $125 million.
Management of the funds seeks to provide shareholders with favorable yields and
a constant $1.00 share price through skilled and responsible investment
management. The consistently strong performance our shareholders have come to
expect has continued during the first half of our 1997-98 fiscal year. At the
end of the current reporting period on February 28, 1998 the seven-day and
thirty-day simple yields, respectively, for each of the funds were: Daily Assets
Cash Fund 5.29% and 5.29%, Daily Assets Treasury Fund 5.02% and 4.93%, Daily
Assets Treasury Obligations Fund 5.44% and 5.33%, and Daily Assets Government
Fund 5.59% and 5.56%. While past performance is not indicative of future
results, we believe the funds are well positioned for the coming year.
The management of Forum Funds wishes to thank you for your continued confidence.
We remain committed to bringing you excellent performance and the high level of
service to which you as shareholders are entitled. We invite you to call us with
your comments or questions at (207) 879-0001.
Sincerely,
John Y. Keffer
Chairman
THERE CAN BE NO ASSURANCE THAT THE FUNDS WILL BE ABLE TO MAINTAIN A STABLE NET
ASSET VALUE OF $1.00 PER SHARE. AN INVESTMENT IN THE FUNDS IS NEITHER INSURED
NOR GUARANTEED BY THE U.S. GOVERNMENT. DURING THE PERIOD, SOME OF THE FUNDS'
FEES MAY HAVE BEEN WAIVED OR REIMBURSED; IF THESE FEES WERE NOT WAIVED OR
REIMBURSED PERFORMANCE WOULD HAVE BEEN LOWER.
<PAGE>
FORUM FUNDS
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STATEMENTS OF ASSETS AND LIABILITIES
FEBRUARY 28, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C>
DAILY ASSETS
DAILY ASSETS TREASURY DAILY ASSETS DAILY ASSETS
TREASURY OBLIGATIONS GOVERNMENT CASH
FUND FUND FUND FUND
------------------ ---------------- ----------------- ------------------
ASSETS:
Investments in Portfolios of Core Trust (Delaware) at
value (a) $ 46,711,843 $ 61,193,009 $ 4,971,871 $ 13,354,954
Organization costs, net of amortization - 4,950 6,568 -
------------------ ---------------- ----------------- ------------------
46,711,843 61,197,959 4,978,439 # 13,354,954
------------------ ---------------- ----------------- ------------------
LIABILITIES:
Dividends payable 164,863 262,785 19,328 48,676
Payable to administrator (Note 3) 1,806 - - -
Accrued expenses and other liabilities 26,372 8,211 6,789 2,524
------------------ ---------------- ----------------- ------------------
Total liabilities 193,041 270,996 26,117 51,200
------------------ ---------------- ----------------- ------------------
NET ASSETS $ 46,518,802 $ 60,926,963 $ 4,952,322 $ 13,303,754
================== ================ ================= ==================
COMPONENTS OF NET ASSETS:
Paid in capital 46,517,664 60,926,092 4,952,322 13,303,659
Undistributed (distribution in excess of)
net investment income 19,454 - - -
Accumulated net realized gain (loss) (18,316) 871 - 95
------------------ ---------------- ----------------- ------------------
NET ASSETS $ 46,518,802 $ 60,926,963 $ 4,952,322 $ 13,303,754
================== ================ ================= ==================
SHARES OF BENEFICIAL INTEREST: 46,517,664 60,926,092 4,952,322 13,303,659
NET ASSET VALUE PER SHARE (OFFERING AND
REDEMPTION PRICE PER SHARE) $ 1.00 $ 1.00 $ 1.00 $ 1.00
(a) Cost of Investments. $ 46,711,843 $ 61,193,009 $ 4,971,871 $ 13,354,954
</TABLE>
See Notes to Financial Statements. 2 FORUM FUNDS
<PAGE>
FORUM FUNDS
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STATEMENTS OF OPERATIONS
FOR THE PERIOD ENDED FEBRUARY 28, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C>
DAILY ASSETS
DAILY ASSETS TREASURY DAILY ASSETS DAILY ASSETS
TREASURY OBLIGATIONS GOVERNMENT CASH
FUND FUND (NOTE 1) FUND (NOTE 1) FUND
-------------------- ----------------------- ---------------------- --------------------
INVESTMENT INCOME ALLOCATED
FROM PORTFOLIOS OF CORE
TRUST (DELAWARE):
Interest income $ 1,145,480 $ 360,197 $ 21,189 $ 321,454
Net expenses (31,958) (9,831) (516) (8,283)
-------------------- ----------------------- ---------------------- --------------------
Net investment income allocated from
Portfolios of Core Trust (Delaware)
(Note 2) 1,113,522 350,366 20,673 313,171
-------------------- ----------------------- ---------------------- --------------------
EXPENSES:
Management (Note 3) 15,066 3,262 184 4,031
Transfer agent (Note 3) 41,221 4,588 1,252 15,440
Accounting (Note 3) 6,000 1,323 1,065 6,000
Audit 2,767 - - 2,767
Legal (Note 3) 7,857 692 49 4,448
Trustees 1,322 100 100 576
Registration 7,488 1,763 1,612 2,887
Reporting 11,324 - - 3,699
Amortization of organization costs - 112 119 -
Miscellaneous 9,627 126 13 2,285
-------------------- ----------------------- ---------------------- --------------------
Total expenses 102,672 11,966 4,394 42,133
Expenses reimbursed and
fees waived (Note 4) (33,900) (8,703) (4,172) (24,006)
-------------------- ----------------------- ---------------------- --------------------
Net expenses 68,772 3,263 222 18,127
-------------------- ----------------------- ---------------------- --------------------
NET INVESTMENT INCOME 1,044,750 347,103 20,451 295,044
-------------------- ----------------------- ---------------------- --------------------
NET REALIZED GAIN (LOSS) ON
INVESTMENTS ALLOCATED
FROM PORTFOLIOS OF CORE
TRUST (DELAWARE) (20,126) 871 - 95
-------------------- ----------------------- ---------------------- --------------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $ 1,024,624 $ 347,974 $ 20,451 $ 295,139
==================== ======================= ====================== ====================
</TABLE>
See Notes to Financial Statements. 3 FORUM FUNDS
<PAGE>
FORUM FUNDS
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STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED MARCH, 1997 AND THE PERIODS ENDED AUGUST 31, 1997 AND
FEBRUARY 28, 1998
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
DAILY ASSETS
TREASURY
FUND
-----------------
NET ASSETS - March 31, 1996 $ 43,102,929
- -------------------------------------------------------------- -----------------
OPERATIONS:
Net investment income 1,937,414
Net realized gain (loss) on investments allocated from Portfolios of
Core Trust (Delaware) (1,082)
-----------------
Net increase (decrease) in net assets resulting
from operations 1,936,332
-----------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (1,937,414)
-----------------
CAPITAL SHARES TRANSACTIONS (at $1.00 per share):
Sale of shares 93,585,220
Reinvestment of distributions 94,618
Redemption of shares (92,806,533)
-----------------
Net increase (decrease) from capital transactions 873,305
-----------------
Net increase (decrease) in net assets 872,223
-----------------
NET ASSETS - March 31, 1997 43,975,152
- -------------------------------------------------------------- -----------------
OPERATIONS:
Net investment income 862,364
Net realized gain (loss) on investments allocated from Portfolios of
Core Trust (Delaware) 15,133
-----------------
Net increase (decrease) in net assets resulting
from operations 877,497
-----------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (862,364)
-----------------
CAPITAL SHARES TRANSACTIONS (at $1.00 per share):
Sale of shares 35,543,377
Reinvestment of distributions 68,736
Redemption of shares (35,486,607)
-----------------
Net increase (decrease) from capital transactions 125,506
-----------------
Net increase (decrease) in net assets 140,639
-----------------
NET ASSETS - August 31, 1997 (Note 1) 44,115,791
- -------------------------------------------------------------- =================
OPERATIONS:
Net investment income 1,044,750
Net realized gain (loss) on investments allocated from Portfolios of
Core Trust (Delaware) (20,126)
-----------------
Net increase (decrease) in net assets resulting
from operations 1,024,624
-----------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (1,044,750)
-----------------
CAPITAL SHARES TRANSACTIONS (at $1.00 per share):
Sale of shares 71,713,517
Reinvestment of distributions 97,385
Redemption of shares (69,387,765)
-----------------
Net increase (decrease) from capital transactions 2,423,137
-----------------
Net increase (decrease) in net assets 2,403,011
-----------------
NET ASSETS - February, 28, 1998 (Unaudited) $ 46,518,802
- -------------------------------------------------------------- =================
</TABLE>
See Notes to Financial Statements. 4 FORUM FUNDS
<PAGE>
FORUM FUNDS
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STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED AUGUST 31, 1997 AND THE PERIOD ENDED FEBRUARY 28, 1998
(Concluded)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C>
DAILY ASSETS
TREASURY DAILY ASSETS DAILY ASSETS
OBLIGATIONS GOVERNMENT CASH
FUND (NOTE 1) FUND (NOTE 1) FUND
----------------- ----------------- ----------------
NET ASSETS - August 31, 1996 - - -
- -------------------------------------------------------------- ----------------- ----------------- ----------------
OPERATIONS:
Net investment income - - 377,014
----------------- ----------------- ----------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income - - (377,014)
----------------- ----------------- ----------------
CAPITAL SHARES TRANSACTIONS (at $1.00 per share):
Sale of shares - - 32,622,774
Reinvestment of distributions - - 12,391
Redemption of shares - - (20,559,091)
----------------- ----------------- ----------------
Net increase (decrease) from capital transactions - - 12,076,074
----------------- ----------------- ----------------
Net increase (decrease) in net assets - - 12,076,074
----------------- ----------------- ----------------
NET ASSETS - August 31, 1997 - - 12,076,074
- -------------------------------------------------------------- ----------------- ----------------- ----------------
OPERATIONS:
Net investment income 347,103 20,451 295,044
Net realized gain (loss) on investments allocated from Portfolios of
Core Trust (Delaware) 871 - 95
----------------- ----------------- ----------------
Net increase (decrease) in net assets resulting
from operations 347,974 20,451 295,139
----------------- ----------------- ----------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (347,103) (20,451) (295,044)
----------------- ----------------- ----------------
CAPITAL SHARES TRANSACTIONS (at $1.00 per share):
Sale of shares 80,339,501 5,493,736 14,683,100
Reinvestment of distributions - - 16,213
Redemption of shares (19,413,409) (541,414) (13,471,728)
----------------- ----------------- ----------------
Net increase (decrease) from capital transactions 60,926,092 4,952,322 1,227,585
----------------- ----------------- ----------------
Net increase (decrease) in net assets 60,926,963 4,952,322 1,227,680
----------------- ----------------- ----------------
NET ASSETS - February 28, 1998 (Unaudited) $ 60,926,963 $ 4,952,322 $ 13,303,754
- -------------------------------------------------------------- ================= ================= ================
</TABLE>
See Notes to Financial Statements. 5 FORUM FUNDS
<PAGE>
FORUM FUNDS
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FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Following is selected data for a share of each Fund outstanding during the
periods indicated.
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
RATIOS TO AVERAGE
NET ASSETS
BEGINNING DISTRIBUTIONS ENDING ---------------------
NET ASSET NET FROM NET NET ASSET NET
VALUE PER INVESTMENT INVESTMENT VALUE PER NET INVESTMENT
SHARE INCOME INCOME SHARE EXPENSES INCOME
---------- ----------- ----------- ----------- ---------------------
DAILY ASSETS TREASURY FUND
Period Ended February 28, 1998 (b) $1.00 $0.02 ($0.02) $1.00 0.47%(c) 4.86%(c)
Period Ended August 31, 1997 (e) 1.00 0.02 (0.02) 1.00 0.50%(c) 4.76%(c)
Year Ended March 31, 1997 1.00 0.05 (0.05) 1.00 0.50% 4.70%
Year Ended March 31, 1996 1.00 0.05 (0.05) 1.00 0.50% 5.01%
Year Ended March 31, 1995 1.00 0.04 (0.04) 1.00 0.37% 4.45%
Year Ended March 31, 1994 1.00 0.03 (0.03) 1.00 0.33% 2.82%
DAILY ASSETS TREASURY
OBLIGATIONS FUND
Period Ended February 28, 1998 (b)(f) 1.00 0.01 (0.01) 1.00 0.20%(c) 2.13%(c)
DAILY ASSETS
GOVERNMENT CASH FUND
Period Ended February 28, 1998 (b)(f) 1.00 0.01 (0.01) 1.00 0.20%(c) 1.76%(c)
DAILY ASSETS CASH FUND
Period Ended February 28, 1998 (b) 1.00 0.03 (0.03) 1.00 0.47%(c) 5.23%(c)
Period Ended August 31, 1997 (f) 1.00 0.05 (0.05) 1.00 0.52%(c) 5.06%(c)
</TABLE>
(a) During each period, certain fees and expenses were waived and reimbursed,
respectively. The ratio of Gross Expenses to Average Net Assets reflects
the expense ratio excluding any waivers and reimbursements for the Fund and
its corresponding Portfolio.
(b) Unaudited.
(c) Annualized.
(d) Not Annualized.
(e) Effective June 19, 1997, Daily Assets Treasury Fund changed its year end
from March 31 to August 31.
(f) See Note 1 of Notes to Financial Statements for date of commencement of
operations.
See Notes to Financial Statements. 6 FORUM FUNDS
<PAGE>
FORUM FUNDS
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FINANCIAL HIGHLIGHTS (Concluded)
- --------------------------------------------------------------------------------
Following is selected data for a share of each class of each Fund outstanding
during the periods indicated.
<TABLE>
<S> <C> <C> <C>
RATIO TO
AVERAGE
NET ASSETS
NET ASSETS AT ----------------
TOTAL END OF PERIOD GROSS
RETURN (000'S OMITTED) EXPENSES (A)
-------- --------------- ----------------
DAILY ASSETS TREASURY
FUND
Period Ended February 28, 1998(b) 2.43%(d) $ 46,519 0.78%(c)
Period Ended August 31, 1997(e) 2.01%(d) 44,116 0.95%(c)
Year Ended March 31, 1997 4.80% 43,975 0.99%
Year Ended March 31, 1996 5.18% 43,103 1.06%
Year Ended March 31, 1995 4.45% 36,329 1.10%
Year Ended March 31, 1994 2.83% 26,505 1.17%
DAILY ASSETS TREASURY
OBLIGATIONS FUND
Period Ended February 28, 1998(b)(f) 0.55%(d) $ 60,926 0.35%(c)
DAILY ASSETS
GOVERNMENT CASH FUND
Period Ended February 28, 1998(b)(f) 0.46%(d) 4,952 1.33%(c)
DAILY ASSETS CASH FUND
Period Ended February 28, 1998(b) 2.62%(d) 13,034 0.89%(c)
Period Ended August 31, 1997(f) 4.70%(d) 12,076 1.22%(c)
</TABLE>
(a) During each period, certain fees and expenses were waived and reimbursed,
respectively. The ratio of Gross Expenses to Average Net Assets reflects
the expense ratio excluding any waivers and reimbursements for the Fund and
its corresponding Portfolio.
(b) Unaudited.
(c) Annualized.
(d) Not Annualized.
(e) Effective June 19, 1997, Daily Assets Treasury Fund changed its year end
from March 31 to August 31.
(f) See Note 1 of Notes to Financial Statements for date of commencement of
operations.
See Notes to Financial Statements. 7 FORUM FUNDS
<PAGE>
FORUM FUNDS
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NOTES TO FINANCIAL STATEMENTS
FEBRUARY, 28 1998 (Unaudited)
- --------------------------------------------------------------------------------
NOTE 1. SUMMARY OF ORGANIZATION
Forum Funds (the "Trust") is an open-end, management investment company
organized as a Delaware business trust. The Trust currently has twenty-five
active investment portfolios. These financial statements relate to Daily Assets
Treasury Fund, Daily Assets Treasury Obligations Fund, Daily Assets Government
Fund and Daily Assets Cash Fund (each a "Fund" and collectively "the Funds"),
each of which is diversified. The Funds are authorized under the Trust's Trust
Instrument to issue an unlimited number of shares of beneficial interest without
par value. Each Fund currently is authorized to issue three classes of shares,
Institutional Shares, Institutional Service Shares and Investor Shares. The
Trust commenced the offering of each class of shares as follows and no other
class of shares currently is outstanding.
<TABLE>
<S> <C>
Daily Assets Treasury Fund (Institutional Service Shares) July 1, 1992
Daily Assets Treasury Obligations Fund (Institutional Shares) January 22, 1998
Daily Assets Government Fund (Institutional Shares) January 30, 1998
Daily Assets Cash Fund (Institutional Service Shares) October 1, 1996
</TABLE>
Effective June 19, 1997, Daily Assets Treasury Fund changed its year end from
March 31 to August 31.
MASTER FEEDER ARRANGEMENT - Each Fund currently seeks to achieve its investment
objective by investing all of its investable assets in a separate portfolio of
Core Trust (Delaware) ("Core Trust") which has the same investment objective and
substantially similar policies as the Fund. Core Trust also is registered as an
open-end, management investment company and the portfolios in which the Funds
invest, Treasury Portfolio, Treasury Cash Portfolio, Government Cash Portfolio
and Cash Portfolio (the "Portfolios"), are all diversified. The Funds account
for their investment in a Portfolio as partnership investments. This is commonly
referred to as a master-feeder arrangement.
The financial statements of the Portfolios, including the schedule of
investments, are included elsewhere in this report and should be read in
conjunction with the Funds' financial statements. As of February 28, 1998 Daily
Assets Treasury Fund owns substantially all of the interests of its Portfolio.
As of that date the percentage of Treasury Cash Portfolio owned by Daily Assets
Treasury Fund was 36.4%; the percentage of Government Cash Portfolio owned by
Daily Assets Government Fund was 0.8%; and the percentage of Cash Portfolio
owned by Daily Assets Cash Fund was 3.4%.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
These financial statements are prepared in accordance with generally accepted
accounting principles which require management to make estimates and assumptions
that affect the reported amounts of assets and liabilities, the disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of increase and decrease in net assets from operations
during the fiscal periods. Actual results could differ from those estimates.
The following represent significant accounting policies of the Funds:
SECURITY VALUATION - Each Fund determines its net asset value per share as of
1:00 p.m., Pacific time, on each Fund business day. Each Fund records its
investment in its Portfolio at value. Valuation of securities held in the
Portfolios is discussed in the Notes to the Financial Statements of Core Trust.
INVESTMENT INCOME AND EXPENSES - Each Fund records daily its pro rata share of
each Portfolio's income, expenses and realized gain and loss. In addition, each
Fund accrues its own expenses.
8 FORUM FUNDS
<PAGE>
FORUM FUNDS
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NOTES TO FINANCIAL STATEMENTS
FEBRUARY, 28 1998 (Unaudited) (Continued)
- --------------------------------------------------------------------------------
ORGANIZATION COSTS - The costs incurred by the Daily Assets Treasury Obligations
Fund and Daily Assets Government Fund in connection with their organization and
registration of shares have been capitalized and are being amortized using the
straight-line method over a five year period beginning with the commencement of
the Funds' operations.
FEDERAL TAXES - Each Fund intends to qualify and continue to qualify each year
as a regulated investment company and distribute all of its taxable income. In
addition, by distributing in each calendar year substantially all of its net
investment income, capital gain and certain other amounts, if any, each Fund
will not be subject to a federal excise tax. Therefore, no federal income or
excise tax provision is required.
DISTRIBUTIONS TO SHAREHOLDERS - Distributions to shareholders of net investment
income are declared daily and paid monthly. Net capital gain, if any, is
distributed to shareholders at least annually. Distributions are based on
amounts calculated in accordance with applicable income tax regulations.
NOTE 3. INVESTMENT ADVISORY AND OTHER SERVICES
INVESTMENT ADVISER - The investment adviser to each Portfolio is Forum
Investment Advisors, LLC ("Forum Advisors"). Prior to January 2, 1998 Linden
Asset Management, Inc. served as investment adviser to Treasury Cash Portfolio,
Government Cash Portfolio and Cash Portfolio. Effective January 2, 1998, Forum
Advisors, Inc. reorganized as Forum Advisors. A Fund may withdraw its investment
from its Portfolio at any time if the Board determines that it is in the best
interest of the Fund and its shareholders to do so.
ADMINISTRATOR - The administrator of the Funds is Forum Administrative Services,
LLC ("Forum"). For its administrative services and facilities, Forum receives
from each Fund a fee at an annual rate of 0.05% of the average daily net assets
of the Fund. In addition, certain legal expenses are charged to the Funds by
Forum. For the period ended February 28, 1998, the respective amounts charged to
Daily Assets Treasury Fund and Daily Assets Cash were $665 and $166. A previous
management agreement in effect with Forum Financial Services, Inc. ("FFSI")
during the period was similar in all material terms to the current agreement
with Forum.
TRANSFER AGENT AND OTHER SERVICE PROVIDERS - The transfer agent and dividend
disbursing agent for the Funds is Forum Financial Corp. (the "Transfer Agent").
The Transfer Agent is paid a transfer agent fee at an annual rate of 0.5% of the
average daily net assets of Institutional Shares of each Fund. In addition, the
Transfer Agent is paid $12,000 per Fund plus $6,000 per each class of shares of
the Funds above one, plus certain account charges.
Forum Accounting Services, LLC ("FAcS") provides fund accounting services to the
Funds. For its services, FAcS receives from each Fund an annual fee of $12,000
plus certain amounts based upon the number and types of portfolio transactions
within each Fund.
DISTRIBUTOR - FFSI, a registered broker-dealer and a member of the National
Association of Securities Dealers, Inc, acts as each Fund's distributor.
NOTE 4. WAIVER OF FEES AND REIMBURSEMENT OF EXPENSES
Forum and the Transfer Agent have voluntarily waived a portion of their fees,
and Forum has assumed certain expenses of the Funds. For the period ended
February 28, 1998, fees waived and expenses reimbursed were as follows:
9 FORUM FUNDS
<PAGE>
FORUM FUNDS
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
FEBRUARY, 28 1998 (Unaudited) (Concluded)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C>
Fees Waived
-----------
Expenses Transfer
Reimbursed Agent Forum Total
---------- ----- ----- -----
Daily Assets Treasury Fund $ - $33,900 $ - $33,900
Daily Assets Treasury Obligations Fund 2,179 3,262 3,262 8,703
Daily Assets Government Fund 3,804 184 184 4,172
Daily Assets Cash Fund 10,863 9,112 4,031 24,006
</TABLE>
NOTE 5. SPECIAL MEETING OF SHAREHOLDERS
The following matter was submitted to a vote of shareholders of Daily Assets
Cash Fund at a special meeting of shareholders held December 12, 1997 to
authorize the Trust, on behalf of that Fund, to vote at a meeting of the
interestholders of Core Trust (Delaware) to approve a new Investment Advisory
Agreement between Core Trust (Delaware) and Forum Advisors with respect to Cash
Portfolio. Votes were cast as follows: 9,395,473 For; 0 Against; 15,629
Abstained.
10 FORUM FUNDS
<PAGE>
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<PAGE>
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<PAGE>
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<PAGE>
CORE TRUST (DELAWARE)
SEMI-ANNUAL REPORT
FEBRUARY 28, 1998
TREASURY PORTFOLIO
TREASURY CASH PORTFOLIO
GOVERNMENT CASH PORTFOLIO
CASH PORTFOLIO
<PAGE>
CORE TRUST (DELAWARE)
- --------------------------------------------------------------------------------
TREASURY PORTFOLIO
SCHEDULE OF INVESTMENTS
FEBRUARY 28, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
Face Security
Amount Description Value
- -------------- ------------------------------- ----------------
U.S. GOVERNMENT SECURITIES (99.7%)
FEDERAL HOME LOAN BANK -
DISCOUNT NOTES (A) (8.7%)
3,000,000 5.40%, 3/11/98 $ 2,996,040
500,000 5.44%, 5/11/98 494,847
550,000 5.44%, 6/30/98 540,357
----------------
Total Federal Home Loan Bank -
Discount Notes 4,031,244
----------------
STUDENT LOAN MARKETING ASSOCIATION (B) (24.7%)
11,500,000 5.46%, 4/16/98 11,500,000
----------------
U.S. TREASURY BILLS (A) (55.5%)
26,000,000 5.39%, 4/23/98 25,797,952
----------------
U.S. TREASURY NOTES (10.8%)
5,000,000 5.88, 8/15/98 5,004,279
----------------
Total U.S. Government Securities 46,333,475
----------------
SHARES
- --------------
SHORT-TERM HOLDINGS (0.3%)
123,541 Dreyfus Treasury Prime Cash
Management Fund Class A Shares 123,541
----------------
Total Investments (100.0%) $ 46,457,016
================
</TABLE>
(A) Annualized yields at time of purchase.
(B) Certain securities are deemed to have a maturity remaining until
the next readjustment of the interest rate or the longer of the
demand period or readjustment. The interest rates shown reflect
the rate in effect of February 28, 1998.
See Notes to Financial Statements. 15 CORE TRUST (DELAWARE)
<PAGE>
CORE TRUST (DELAWARE)
- --------------------------------------------------------------------------------
TREASURY CASH PORTFOLIO
SCHEDULE OF INVESTMENTS
FEBRUARY 28, 1998 (Unaudited)
- --------------------------------------------------------------------------------
FACE SECURITY
AMOUNT DESCRIPTION VALUE
- -------------- ---------------------------- ---------------
U.S. TREASURY BILLS (A) (59.0%)
100,000,000 5.39%, 4/23/98 $ 99,239,031
---------------
REPURCHASE AGREEMENTS (41.0%)
22,940,000 BancAmerica Robertson Stephens,
5.60%, 3/2/98, to be repurchased
at $22,950,705; Collateralized by
$22,830,000 UST Notes, 6.75%
6/30/99 22,940,000
23,000,000 Donaldson, Lufkin & Jenrette, Inc., 5.60%, 3/2/98, to be
repurchased at $23,010,733; Collateralized by $44,443,005 UST
Strips, 0.00% 2/15/09 23,000,000
23,000,000 Merrill Lynch & Co., Inc., 5.55%,
3/2/98, to be repurchased at
$23,010,638; Collateralized by
$23,285,000 UST Notes, 6.00%,
8/13/99 23,000,000
---------------
Total Repurchase Agreements 68,940,000
---------------
Total Investments (100.0%) $ 168,179,031
===============
(A) Annualized yields at time of purchase.
UST U.S. Treasury
See Notes to Financial Statements. 16 CORE TRUST (DELAWARE)
<PAGE>
CORE TRUST (DELAWARE)
- --------------------------------------------------------------------------------
GOVERNMENT CASH PORTFOLIO
SCHEDULE OF INVESTMENTS
FEBRUARY 28, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C> <C>
FACE SECURITY FACE SECURITY
AMOUNT DESCRIPTION VALUE AMOUNT DESCRIPTION VALUE
- -------------- ---------------------------- --------------- ------------ --------------------------------- --------------
U.S. GOVERNMENT SECURITIES (55.4%) STUDENT LOAN MARKETING ASSOCIATION (B) (10.3%)
FEDERAL FARM CREDIT BANK (B) (3.0%) 57,050,000 5.68%, 6/18/98 $ 57,050,000
18,000,0005.46%, 4/1/99 $ 18,000,000 5,000,000 5.49%, 1/13/99 5,000,000
--------------- --------------
Total Student Loan Marketing Association 62,050,000
--------------
FEDERAL HOME LOAN BANK -
DISCOUNT NOTES (A) (4.1%) Total U.S. Government Securities 333,141,814
--------------
25,000,000 5.71%, 3/23/98 24,918,917
---------------
REPURCHASE AGREEMENTS (42.7%)
FEDERAL NATIONAL MORTGAGE ASSOCIATION - 101,650,000 BancAmerica Robertson Stephens,
DISCOUNT NOTES (A) (24.9%) 5.66%, 3/2/98. to be repurchased
100,000,000 5.77%, 3/12/98 99,844,168 at $101,697,945; Collateralized by;
8,644,000 5.76%, 3/30/98 8,606,485 $15,850,000 multiple FFCB, Discount
41,287,000 5.75%, 4/24/98 40,949,136 Notes, 0.00%, 4/28/98 to 5/9/98;
---------------
Total Federal National Mortgage Association - $25,825,000 multiple FHLB Bonds,
Discount Notes 149,399,789 5.05% to 6.03%, 2/6/01 to 8/27/01;
---------------
$12,000,000 FHLB Discount Notes,
SMALL BUSINESS ADMINISTRATION (B) (13.1%) 0.00%, 5/1/98; and $50,000,000 UST
367,225 Pool # 500545, 8.38%, 3/25/03 367,924 Notes, 5.63%, 12/31/99 101,650,000
359,182 Pool # 500746, 7.75%, 11/25/01 359,182 125,000,000 Bear Stearns & Co., Inc., 5.60%, 3/2/98,
1,296,725 Pool # 501077, 7.00%, 11/25/14 1,306,411 to be repurchased at $125,058,333;
2,502,148 Pool # 501308, 7.00%, 10/25/15 2,558,171 Collateralized by; $50,000,000 FHLB
3,205,054 Pool # 501543, 6.88%, 7/25/16 3,217,801 186 PO, 0.00%, 7/15/27; $18,985,000
451,264 Pool # 501628, 8.38%, 9/25/04 451,264 FNMA 222 IO, 7.00%, 6/25/23;
1,387,042 Pool # 501690, 6.63%, 9/25/16 1,397,388 $32,505,000 FNMA 267 PO, 0.00%,
1,952,856 Pool # 501898, 6.75%, 7/25/17 1,961,585 10/25/24; $3,470,000 FNMA 272 PO,
5,855,393 Pool # 502150, 6.50%, 2/25/18 5,948,530 0.00%, 6/25/26; and $50,705,000
588,475 Pool # 502161, 6.50%, 2/25/18 590,794 multiple FNMA 282 IO, 7.00%, 9/1/25 125,000,000
3,275,510 Pool # 502208, 6.50%, 2/25/18 3,326,146 30,000,000 Smith Barney, 5.67%, 3/2/98, to be
2,257,850 Pool # 502306, 6.50%, 2/25/18 2,293,855 repurchased at $30,014,175;
3,125,598 Pool # 502613, 6.50%, 4/25/19 3,125,598 Collateralized by $41,769,000
1,110,529 Pool # 503058, 6.38%, 7/25/15 1,110,529 FNMA 289-1, 0.00%, 10/30/27 30,000,000
--------------
1,729,059 Pool # 503082, 6.38%, 8/25/20 1,729,059
2,001,262 Pool # 503120, 6.38%, 11/25/20 2,001,262 Total Repurchase Agreements 256,650,000
--------------
469,061 Pool # 503121, 6.38%, 8/25/15 469,061
2,824,681 Pool # 503232, 6.13%, 12/25/15 2,824,681 SHARES
------------
1,227,750 Pool # 503278, 6.13%, 2/25/21 1,227,725 SHORT-TERM HOLDINGS (1.9%)
2,928,767 Pool # 503431, 6.25%, 7/25/21 2,930,488 11,331,000 Dreyfus Cash Management Fund 11,331,000
--------------
3,612,813 Pool # 503461, 6.25%, 9/25/21 3,614,944
2,727,262 Pool # 503472, 6.25%, 8/25/21 2,728,851 Total Investments (100.0%) $ 601,122,814
==============
1,184,734 Pool # 503553, 6.13%, 11/25/21 1,181,748
5,085,129 Pool # 503671, 6.13%, 3/25/22 5,085,129 (A) Annualized yields at time of purchase.
1,890,426 Pool # 503754, 6.13%, 5/25/22 1,890,426 (B) Certain securities are deemed to have a maturity remaining
1,205,692 Pool # 503780, 6.13%, 3/25/22 1,207,179 until the next readjustment of the interest rate or the
5,201,281 Pool # 503882, 6.00%, 9/25/22 5,194,883 longer of the demand period or readjustment. The interest
4,399,525 Pool # 503892, 6.13%, 7/25/22 4,410,347 rates shown reflect the rate in effect on February 28, 1998.
5,973,557 Pool # 503909, 6.00%, 10/25/22 5,969,872 FFCB Federal Farm Credit Bank
3,000,000 Pool # 504015, 6.00%, 1/25/23 2,999,066 FHLB Federal Home Loan Bank
5,293,209 Pool # 504062, 6.00%, 2/25/23 5,293,209 FNMA Federal National Mortgage Association
--------------- UST U.S. Treasury
Total Small Business Administration 78,773,108
---------------
</TABLE>
See Notes to Financial Statements. 17 CORE TRUST (DELAWARE)
<PAGE>
CORE TRUST (DELAWARE)
- --------------------------------------------------------------------------------
CASH PORTFOLIO
SCHEDULE OF INVESTMENTS
FEBRUARY 28, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C> <C>
FACE SECURITY FACE SECURITY
AMOUNT DESCRIPTION VALUE AMOUNT DESCRIPTION VALUE
- -------------- ---------------------------- --------------- ------------ -------------------------------- --------------
U.S. GOVERNMENT SECURITIES (24.6%) CORPORATE NOTES (7.9%)
FEDERAL HOME LOAN BANK 6,000,000 Banc America Robertson
DISCOUNT NOTES (A) (15.4%) Stephens, 5.65%, V/R, 4/16/98 $ 6,000,000
60,000,000 5.45%, 3/2/98 $ 60,000,000 15,000,000 Bear Stearns & Co., Inc., 5.73%
---------------
V/R, 1/6/99 15,000,000
SMALL BUSINESS ADMINISTRATION (B) (9.2%) 5,000,000 Merrill Lynch & Co., Inc.,
353,335 Pool # 500536, 7.50%, 5/25/13 359,357 5.61% V/R, 3/4/98 5,000,000
571,759 Pool # 500730, 8.38%, 2/25/04 582,432 5,000,000 Merrill Lynch & Co., Inc.,
19,148 Pool # 501256, 7.45%, 7/25/98 19,148 5.63% V/R, 7/24/98 5,000,000
--------------
1,361,739 Pool # 501733, 6.50%, 2/25/17 1,385,325 Total Corporate Notes 31,000,000
--------------
1,138,183 Pool # 501989, 6.63%, 10/25/12 1,144,493
428,693 Pool # 502914, 6.50%, 3/25/15 429,146 REPURCHASE AGREEMENTS (35.6%)
1,876,244 Pool # 503121, 6.38%, 8/25/15 1,876,244 64,075,000 BancAmerica Robertson Stephens,
5,597,145 Pool # 503429, 6.25%, 6/25/16 5,597,145 5.66%, 3/2/98, to be repurchased
903,203 Pool # 503461, 6.25%, 9/25/21 903,743 at $64,105,222; Collaterlized by
4,364,747 Pool # 503553, 6.13%, 11/25/21 4,353,095 $66,000,000 multiple FNMA
2,835,639 Pool # 503754, 6.13%, 5/25/22 2,835,639 Discount Notes, 0.00%, 3/12/98
4,970,546 Pool # 503882, 6.00%, 9/25/22 4,964,424 to 8/24/98 64,075,000
5,686,363 Pool # 503912, 6.00%, 10/25/22 5,682,854
5,731,247 Pool # 504014, 6.00%, 1/25/23 5,729,463 75,000,000 Bear Stearns & Co., Inc., 5.60%,
---------------
Total Small Business Administration 35,862,508 3/2/98, to be repurchased at
---------------
$75,035,000; Collaterlized by
Total U.S. Government Securities 95,862,508 $4,921,664 FHLMC 52 PC, 0.00%,
---------------
4/25/24; $17/800,000 FHLMC
BANK NOTES (B) (2.0%) 1910 ZV, 8.00%, 10/15/22; $14,846,000
8,000,000 Bankers Trust New York Corp., FHLMC 1933 PN, 0.00%, 2/15/27;
5.66%, 7/21/98 7,999,063 $7,815,000 FHLMC 1967 PA, 0.00%,
---------------
12/15/23; $7,835,000 FHLMC 1976
CERTIFICATE OF DEPOSITS (B) (1.0%) PO, 0.00%, 7/15/27; $11,464,000
4,000,000 Bankers Trust New York Corp., FHLMC 2003 BPG, 0.00%, 10/17/27;
5.64%, 9/11/98 3,999,766 $11,551,053, FHLMC 2003 BPO,
---------------
0.00%, 10/17/27; $13,546,341 FHLMC
COMMERCIAL PAPER (A) (25.3%) 2003 BPO, 0.00%, 10/17/27;
15,000,000 Associates Corp. of North $11,551,053 FHLMC 2003 BPO,
America, 5.49%, 4/9/98 14,913,075 0.00%, 10/17/27; $13,546,341 FHLMC
5,000,000 Ford Motor Credit Corp., 5.49% 2003 B, 0.00%, 10/15/27; and
4/10/98 4,970,264 $2,380,000 FHLMC 2028 PO, 0.00%,
15,000,000 General Electric Capital Corp., 1/15/28 75,000,000
--------------
5.52%, 4/6/98 14,919,500
8,000,000 International Lease Finance Total Repurchase Agreements 139,075,000
--------------
Corp., 5.41%, 6/18/98 7,870,160
5,000,000 Merrill Lynch & Co., Inc., SHORT-TERM HOLDINGS (3.6%)
5.46%, 5/19/98 4,940,850 14,140,000 Dreyfus Cash Management
10,500,000 Monsanto Co., 5.41%, 6/23/98 10,321,696 Plus Fund 14,140,000
--------------
12,000,000 Morgan Stanley Dean Witter,
5.58%, 6/16/98 (B) 12,000,000 Total Investments (100.0%) $ 390,794,928
==============
12,000,000 Prudential Funding, 5.68%,
3/16/98 11,973,493 (A) Annualized yields at time of purchase.
17,000,000 Salomon Smith Barney (B) Certain securities are deemed to have a maturity remaining
Holdings, 5.45%, 5/15/98 16,809,553 until the next readjustment of the interest rate or the
--------------- longer of the demand period or readjustment. The interest
Total Commercial Paper 98,718,591 rates shown reflect the rate in effect on February 28, 1998.
--------------- FHLMC Federal Home Loan Mortgage Corporation
FNMA Federal National Mortgage Association
</TABLE>
See Notes to Financial Statements. 18 CORE TRUST (DELAWARE)
<PAGE>
CORE TRUST (DELAWARE)
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES
FEBRUARY 28, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C>
TREASURY GOVERNMENT
TREASURY CASH CASH CASH
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ----------------- ----------------- -----------------
ASSETS:
Investments: (Note 2)
Securities at amortized cost $ 46,457,016 $ 99,239,031 $ 344,472,814 $ 251,719,928
Repurchase agreements at amortized cost - 68,940,000 256,650,000 139,075,000
----------------- ----------------- ----------------- -----------------
Total investments at value 46,457,016 168,179,031 601,122,814 390,794,928
Cash - 15,756 13,520 20,163
Interest and other receivables 260,166 6,751 2,162,658 1,047,222
Organization costs, net of amortization (Note 2) - 598 10,974 2,968
----------------- ----------------- ----------------- -----------------
Total assets 46,717,182 168,202,136 603,309,966 391,865,281
----------------- ----------------- ----------------- -----------------
LIABILITIES:
Payable to adviser (Note 3) 1,878 4,681 17,651 10,925
Payable to administrator (Note 3) - 5,929 23,311 14,428
Accrued expenses and other liabilities 3,361 8,300 66,874 32,409
----------------- ----------------- ----------------- -----------------
Total liabilities 5,239 18,910 107,836 57,762
----------------- ----------------- ----------------- -----------------
NET ASSETS $ 46,711,943 $ 168,183,226 $ 603,202,130 $ 391,807,519
================= ================= ================= =================
COMPONENTS OF NET ASSETS:
Investors' capital 46,711,943 168,183,226 603,202,130 391,807,519
----------------- ----------------- ----------------- -----------------
NET ASSETS $ 46,711,943 $ 168,183,226 $ 603,202,130 $ 391,807,519
================= ================= ================= =================
</TABLE>
See Notes to Financial Statements. 19 CORE TRUST (DELAWARE)
<PAGE>
CORE TRUST (DELAWARE)
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED FEBRUARY 28, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C>
TREASURY GOVERNMENT
TREASURY CASH CASH CASH
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------------ ---------------- ----------------- ----------------
INVESTMENT INCOME:
Interest income $ 1,145,480 $ 2,745,991 $ 15,538,689 $ 8,776,150
------------------ ---------------- ----------------- ----------------
EXPENSES:
Investment advisory (Note 3) 10,652 19,655 107,682 60,092
Administration (Note 3) 15,636 25,035 136,511 76,452
Custody 5,511 12,518 68,255 38,226
Accounting (Note 3) 24,000 21,735 24,000 24,000
Audit 6,500 792 24,935 17,644
Legal (Note 3) 299 3,252 5,624 3,653
Trustees 935 229 1,507 762
Amortization of organization costs - 120 2,195 594
Miscellaneous 757 1,507 8,039 4,808
------------------ ---------------- ----------------- ----------------
Total expenses 64,290 84,843 378,748 226,231
Expenses reimbursed and fees waived (Note 4) (32,332) (10,258) - -
------------------ ---------------- ----------------- ----------------
Net expenses 31,958 74,585 378,748 226,231
------------------ ---------------- ----------------- ----------------
NET INVESTMENT INCOME 1,113,522 2,671,406 15,159,941 8,549,919
------------------ ---------------- ----------------- ----------------
NET REALIZED GAIN (LOSS) ON INVESTMENTS (20,126) 5,849 (41,998) 3,538
------------------ ---------------- ----------------- ----------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $ 1,093,396 $ 2,677,255 $ 15,117,943 $ 8,553,457
================== ================ ================= ================
</TABLE>
See Notes to Financial Statements. 20 CORE TRUST (DELAWARE)
<PAGE>
CORE TRUST (DELAWARE)
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED MARCH 31, 1997 AND THE PERIODS ENDED AUGUST 31, 1997 AND
FEBRUARY 28, 1998
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
TREASURY
PORTFOLIO
-----------------
NET ASSETS - March 31, 1996 $ 43,296,823
- ------------------------------------------------------------- -----------------
OPERATIONS:
Net investment income 2,081,727
Net realized gain (loss) on investments sold (1,082)
-----------------
Net increase (decrease) in net assets resulting
from operations 2,080,645
-----------------
TRANSACTIONS IN INVESTORS' BENEFICIAL INTEREST:
Contributions 54,385,867
Withdrawals (55,579,050)
-----------------
Net transactions in investors' beneficial interests (1,193,183)
-----------------
Net increase (decrease) in net assets 887,462
-----------------
NET ASSETS - March 31, 1997 44,184,285
- ------------------------------------------------------------- -----------------
OPERATIONS:
Net investment income 925,794
Net realized gain (loss) on investments sold 15,133
-----------------
Net increase (decrease) in net assets resulting
from operations 940,927
-----------------
TRANSACTIONS IN INVESTORS' BENEFICIAL INTEREST:
Contributions 22,743,917
Withdrawals (23,547,717)
-----------------
Net transactions in investors' beneficial interests (803,800)
-----------------
Net increase (decrease) in net assets 137,127
-----------------
NET ASSETS - August 31, 1997 (Note 1) 44,321,412
- ------------------------------------------------------------- =================
OPERATIONS:
Net investment income 1,113,522
Net realized gain (loss) on investments sold (20,126)
-----------------
Net increase (decrease) in net assets resulting
from operations 1,093,396
-----------------
TRANSACTIONS IN INVESTORS' BENEFICIAL INTEREST:
Contributions 44,368,671
Withdrawals (43,071,536)
-----------------
Net transactions in investors' beneficial interests 1,297,135
-----------------
Net increase (decrease) in net assets 2,390,531
-----------------
NET ASSETS - February 28, 1998 (Unaudited) $ 46,711,943
- ------------------------------------------------------------- =================
</TABLE>
See Notes to Financial Statements. 21 CORE TRUST (DELAWARE)
<PAGE>
CORE TRUST (DELAWARE)
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED AUGUST 31, 1997 AND THE SIX MONTHS ENDED FEBRUARY 28, 1998
(Concluded)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C>
TREASURY GOVERNMENT
CASH CASH CASH
PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ---------------- -----------------
NET ASSETS - August 31, 1996 $ 83,471,666 $ 508,099,794 $ 126,282,923
- ------------------------------------------------------------- ----------------- ---------------- -----------------
OPERATIONS:
Net investment income 2,525,129 27,216,340 10,105,993
Net realized gain (loss) on investments sold 2,441 (27,824) (8,648)
----------------- ---------------- -----------------
Net increase (decrease) in net assets resulting
from operations 2,527,570 27,188,516 10,097,345
----------------- ---------------- -----------------
TRANSACTIONS IN INVESTORS' BENEFICIAL INTEREST:
Contributions 292,088,302 1,552,918,166 633,698,622
Withdrawals (306,985,018) (1,611,437,731) (510,587,879)
----------------- ---------------- -----------------
Net transactions in investors' beneficial interests (14,896,716) (58,519,565) 123,110,743
----------------- ---------------- -----------------
Net increase (decrease) in net assets (12,369,146) (31,331,049) 133,208,088
----------------- ---------------- -----------------
NET ASSETS - August 31, 1997 71,102,520 476,768,745 259,491,011
- ------------------------------------------------------------- ----------------- ---------------- -----------------
OPERATIONS:
Net investment income 2,671,406 15,159,941 8,549,919
Net realized gain (loss) on investments sold 5,849 (41,998) 3,538
----------------- ---------------- -----------------
Net increase (decrease) in net assets resulting
from operations 2,677,255 15,117,943 8,553,457
----------------- ---------------- -----------------
TRANSACTIONS IN INVESTORS' BENEFICIAL INTEREST:
Contributions 235,362,177 876,396,178 479,088,723
Withdrawals (140,958,726) (765,080,736) (355,325,672)
----------------- ---------------- -----------------
Net transactions in investors' beneficial interests 94,403,451 111,315,442 123,763,051
----------------- ---------------- -----------------
Net increase (decrease) in net assets 97,080,706 126,433,385 132,316,508
----------------- ---------------- -----------------
NET ASSETS - February 28, 1998 (Unaudited) $ 168,183,226 $ 603,202,130 $ 391,807,519
- ------------------------------------------------------------- ================= ================ =================
</TABLE>
See Notes to Financial Statements. 22 CORE TRUST (DELAWARE)
<PAGE>
CORE TRUST (DELAWARE)
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
FEBRUARY, 28 1998 (Unaudited)
- --------------------------------------------------------------------------------
NOTE 1. SUMMARY OF ORGANIZATION
Core Trust (Delaware) ("Core Trust") was organized as a Delaware business trust
on September 1, 1994. Core Trust, which is registered as an open-end, management
investment company under the Investment Company Act of 1940 (the "Act"),
currently has 21 separate investment portfolios. These financial statements
relate to Treasury Portfolio, Treasury Cash Portfolio, Government Cash Portfolio
and Cash Portfolio (each a "Portfolio" and collectively "the Portfolios"), each
of which is diversified. The Portfolios commenced operations on September 1,
1995, except Treasury Portfolio which commenced operations on February 21, 1996.
Interests in the Portfolios are sold in private placement transactions without
any sales charge to institutional clients, including open-end, management
investment companies.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Portfolios' financial statements are prepared in accordance with generally
accepted accounting principles which require management to make estimates and
assumptions that affect the reported amounts of assets and liabilities, the
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of increase and decrease in net assets from
operations during the fiscal period. Actual results could differ from those
estimates.
PORTFOLIO VALUATION - Each Portfolio's net asset value per share is calculated
on each business day utilizing the amortized cost method pursuant to Rule 2a-7
under the Act. Net asset value per share is calculated at 1:00 p.m., Pacific
time; Treasury Portfolio's net asset value per share is calculated at 2:00 p.m.,
Pacific time. Under this method, all investments purchased at a discount or
premium are valued by accreting or amortizing, respectively, the difference
between the original purchase price and the maturity value of the investment
over the period to the investment's maturity.
REPURCHASE AGREEMENTS - The Portfolios may invest in repurchase agreements. Each
Portfolio, through its custodian, receives delivery of the underlying
securities, whose market value must always equal or exceed the repurchase price
plus accrued interest. The investment adviser is responsible for determining the
value of the underlying securities. In the event of default, the Portfolio could
possibly have difficulties with the disposition of the underlying securities.
ORGANIZATIONAL COSTS - The costs incurred by Treasury Cash Portfolio, Government
Cash Portfolio and Cash Portfolio in connection with their organization have
been capitalized and are being amortized using the straight-line method over a
five year period beginning on the commencement of each Portfolio's operations.
These costs were paid by Forum Financial Corp. and were reimbursed by the
Portfolios.
FEDERAL TAXES - The Portfolios are not required to pay federal income taxes on
their net investment income and net capital gain, as they are treated as
partnerships for federal income tax purposes. All interest, dividends, gain and
loss of a Portfolio are deemed to have been "passed through" to the partners in
proportion to their holdings of the Portfolio regardless of whether such
interest, dividends or gain has been distributed by the Portfolio.
SECURITIES TRANSACTIONS, INTEREST INCOME AND REALIZED GAIN AND LOSS - Investment
securities transactions are recorded on trade date. Interest income is accrued
as earned. Realized gain and loss on investments sold are recorded on the basis
of identified cost. The cost basis of investments for federal income tax
purposes at February 28, 1998 is the same as for financial accounting purposes.
23 CORE TRUST (DELAWARE)
<PAGE>
CORE TRUST (DELAWARE)
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
FEBRUARY, 28 1998 (Unaudited) (Continued)
- --------------------------------------------------------------------------------
NOTE 3. INVESTMENT ADVISORY AND OTHER SERVICES
INVESTMENT ADVISER - The investment adviser for each Portfolio is Forum
Investment Advisors, LLC ("Forum Advisors"). Prior to January 2, 1998, Linden
Asset Management served as investment adviser to Treasury Cash Portfolio,
Government Cash Portfolio and Cash Portfolio. Effective January 2, 1998, Forum
Advisors Inc. reorganized as Forum Advisors.
Forum Advisors receives an advisory fee from Treasury Cash Portfolio, Government
Cash Portfolio and Cash Portfolio based upon the total average daily net assets
of those Portfolios ("Total Portfolio Assets") that is calculated on a
cumulative basis at the following annual rates: 0.06% for the first $200 million
of Total Portfolio Assets, 0.04% of the next $300 million of Total Portfolio
Assets and 0.03% of the remaining Total Portfolio Assets. The minimum total
annual advisory fee for these three Portfolios is $50,000. Forum Advisors
receives an advisory fee from Treasury Portfolio at an annual rate of 0.05% of
the average daily net assets of that Portfolio.
ADMINISTRATOR - The administrator of each Portfolio is Forum Administrative
Services, LLC ("Forum"). For its administrative services and facilities, Forum
receives from each Portfolio a management fee at an annual rate of 0.05% of the
average daily net assets of the Portfolio. With the exception of Treasury
Portfolio, certain legal expenses were charged to the Portfolios by Forum. For
the period ended February 28, 1998, the respective amounts charged to, Treasury
Cash Portfolio, Government Cash Portfolio and Cash Portfolio were $48, $319 and
$162.
OTHER SERVICE PROVIDERS - Forum Accounting Services, LLC ("FAcS") serves as the
Portfolios' fund accountant and interestholder recordkeeper. For these services
FAcS receives a fee from each of Treasury Cash Portfolio, Government Cash
Portfolio and Cash Portfolio of the lesser of an annual rate of 0.05% of the
average daily net assets of the Portfolio or $48,000 per year, plus additional
amounts depending on the number and type of portfolio transactions and number of
interest holders. For these services FAS receives a fee from Treasury Portfolio
of $48,000 per year plus additional amounts depending on the number and type of
portfolio transactions and number of interest holders.
PLACEMENT AGENT - Forum Financial Services, Inc. ("FFSI"), a registered
broker-dealer and a member of the National Association of Securities Dealers,
Inc., acts as each Portfolio's placement agent.
NOTE 4. WAIVER OF FEES AND REIMBURSEMENT OF EXPENSES
Forum has voluntarily waived a portion of its fees and has assumed certain
expenses of the Portfolios. For the period February 28, 1998, fees waived and
expenses reimbursed were as follows:
<TABLE>
<S> <C> <C> <C>
Expenses Fees
Reimbursed Waived Total
---------- ------ -----
Treasury Portfolio $16,696 $15,636 $32,332
Treasury Cash Portfolio 10,258 - 10,258
Government Cash Portfolio - - -
Cash Portfolio - - -
</TABLE>
24 CORE TRUST (DELAWARE)
<PAGE>
CORE TRUST (DELAWARE)
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
FEBRUARY, 28 1998 (Unaudited) (Concluded)
- --------------------------------------------------------------------------------
NOTE 5. INCOME AND EXPENSE RATIOS
Portfolio income and expense ratios for the six months ended February 28, 1998
and previous fiscal periods are presented below. During certain periods, various
fees were waived and expenses reimbursed. The ratio of Gross Expenses to Average
Net Assets reflects the expense ratio excluding waivers and reimbursements, if
any.
<TABLE>
<S> <C> <C> <C>
Ratios to Average Net Assets
----------------------------
Net
Investment Gross
Expenses Income Expenses
-------- ------ --------
Treasury Portfolio
Period Ended February 28, 1998 (a)....................................... 0.15% 5.03% 0.30%
Period Ended August 31, 1997 (See Note 1)................................ 0.15% 5.11% 0.36%
Year Ended March 31, 1997................................................ 0.15% 5.04% 0.33%
Period Ended March 31, 1996.............................................. 0.15% 4.99% 0.60%
Treasury Cash Portfolio
Period Ended February 28, 1998 (a)....................................... 0.15% 5.34% 0.17%
Year Ended August 31, 1997............................................... 0.15% 5.20% 0.18%
Year Ended August 31, 1996............................................... 0.15% 5.30% 0.20%
Government Cash Portfolio
Period Ended February 28, 1998 (a)....................................... 0.14% 5.55% 0.14%
Year Ended August 31, 1997............................................... 0.14% 5.38% 0.14%
Year Ended August 31, 1996............................................... 0.14% 5.49% 0.14%
Cash Portfolio
Period Ended February 28, 1998 (a)....................................... 0.15% 5.59% 0.15%
Year Ended August 31, 1997............................................... 0.15% 5.45% 0.15%
Year Ended August 31, 1996............................................... 0.15% 5.50% 0.16%
</TABLE>
(a) Annualized.
NOTE 6. SPECIAL MEETING OF INTERESTHOLDERS
The following matter was submitted to a vote of shareholders of Treasury Cash
Portfolio, Government Cash Portfolio and Cash Portfolio (the "Portfolios") at a
special meeting of shareholders held December 12, 1997, and then continued on
December 18, 1997: to approve a new Investment Advisory Agreement between Core
Trust (Delaware) and Forum Advisors with respect to the Portfolios. Interests in
each of the Portfolios were voted as follows: Treasury Cash Portfolio - 99.63%
For; 0.37% Against; 0.00% Abstained; Government Cash Portfolio - 99.00% For;
1.00% Against; 0.00% Abstained; Cash Portfolio - 96.45% For; 3.55% Against;
0.00% Abstained.
25 CORE TRUST (DELAWARE)
<PAGE>
DISTRIBUTOR
Forum Financial Services, Inc.
TRANSFER AGENT
Forum Financial Corp.
[FORUM LOGO]
FORUM FUNDS
P.O. BOX 446
PORTLAND, ME 04112
207-879-0001 (IN PORTLAND, ME)
800-94FORUM (ELSEWHERE)
THIS REPORT IS AUTHORIZED FOR DISTRIBUTION ONLY
TO CURRENT SHAREHOLDERS AND TO OTHERS WHO HAVE
RECEIVED A COPY OF THE FORUM FUNDS PROSPECTUS.
