FORUM
FUNDS
ANNUAL REPORT
AUGUST 31, 2000
DAILY ASSETS TREASURY
OBLIGATION FUND
DAILY ASSETS
GOVERNMENT FUND
DAILY ASSETS GOVERNMENT
OBLIGATIONS FUND
DAILY ASSETS CASH FUND
DAILY ASSETS
MUNICIPAL FUND
[LOGO OF PARTHENON W/ COMPASS AND CONTRAPTION]
<PAGE>
TABLE OF CONTENTS
A Message to Our Shareholders................................................ 1
FINANCIAL STATEMENTS OF FORUM FUNDS
Independent Auditors' Report ................................................ 2
Statements of Assets and Liabilities......................................... 3
Statements of Operations..................................................... 4
Statements of Changes in Net Assets......................................... 5
Financial Highlights......................................................... 7
Notes to Financial Statements................................................ 9
FINANCIAL STATEMENTS OF CORE TRUST (DELAWARE)
Independent Auditors' Report .............................................. 13
Schedules of Investments:
Treasury Cash Portfolio................................................. 14
Government Portfolio.................................................... 15
Government Cash Portfolio............................................... 16
Cash Portfolio.......................................................... 17
Municipal Cash Portfolio................................................ 18
Notes to Schedules of Investments............................................20
Statements of Assets and Liabilities.........................................21
Statements of Operations.....................................................22
Statements of Changes in Net Assets......................................... 23
Notes to Financial Statements................................................24
<PAGE>
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[OBJECT OMITTED]
DAILY ASSETS TREASURY OBLIGATIONS FUND
DAILY ASSETS GOVERNMENT FUND
DAILY ASSETS GOVERNMENT OBLIGATIONS FUND
DAILY ASSETS CASH FUND
DAILY ASSETS MUNICIPAL FUND ANNUAL REPORT
AUGUST 31, 2000
--------------------------------------------------------------------------------
DEAR SHAREHOLDERS:
The performance of your money market funds over the last year has been most
impressive. Net assets in the Daily Assets Funds increased 20% to $373.3
million. Most notably, the Daily Assets Government Obligations Fund had a 89%
growth in net assets, and the Core Portfolios expanded 46% to reach $3.3
billion. Our portfolio management team continues to use Forum's proprietary Core
and Gateway(R) structure, focusing resources on effectively managing five large
pools of assets that pass along significant yields to your Funds.
Although investment return fluctuates and past performance is not a guarantee of
future results, I am pleased to report that the Funds have sustained high
rankings in their respective categories on the Money Fund ReportTM (a service of
iMoneyNet, Inc. formerly IBC Financial Data). Most recently, two of our funds
were highly ranked in the Money Fund Report based on August 2000 monthly yield.
Daily Assets Government Obligations Fund Institutional Shares was ranked #5 out
of 244 funds in the Government Institutional Category. Daily Assets Municipal
Fund Institutional Shares was ranked #6 out of 95 funds in the Tax-Free
Institutional Category.
As the U.S. economy sustained its rapid growth and oil prices soared, our
portfolio management team was poised to react to actions taken by the Federal
Open Market Committee. The portfolios were structured with relatively short
average lives and were well positioned as a series of Fed Funds Target Rate
increases were imposed. Economic indicators have been responding to such
movement as anticipated. With the economy showing signs of cooling off and the
presidential election approaching, it is likely that no further Fed increases
will be engineered through the remainder of 2000.
We remain dedicated to maintaining your $1.00 share price through prudent
portfolio management while seeking to provide strong performance as we enter the
ninth year of operations of the Daily Assets Funds. And as we continue to
service your money market assets, we are grateful for your continued support and
confidence. Please feel free to call us with your questions or comments at (207)
879-0001.
Sincerely,
/s/ John Y. Keffer
John Y. Keffer
Chairman
An investment in a Fund is neither insured nor guaranteed by the U.S.
Government, the Federal Deposit Insurance Corporation or any other government
agency. Although the Fund seeks to preserve the value of your investment at
$1.00 per share, it is possible to lose money by investing in the Fund.
FORUM FUNDS(R)
<PAGE>
--------------------------------------------------------------------------------
INDEPENDENT AUDITORS' REPORT
--------------------------------------------------------------------------------
The Board of Trustees and Shareholders
Forum Funds
We have audited the accompanying statements of assets and liabilities of Daily
Assets Treasury Obligations Fund, Daily Assets Government Fund, Daily Assets
Government Obligations Fund, Daily Assets Cash Fund and Daily Assets Municipal
Fund (the "Funds"), each a series of Forum Funds, as of August 31, 2000, and the
related statements of operations for the year then ended, statements of changes
in net assets for each of the years in the two-year period then ended, and the
financial highlights for each of the years or periods in the three-year period
ended August 31, 2000 and the period from October 1, 1996 to August 31, 1997.
These financial statements and financial highlights are the responsibility of
the Funds' management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits. Financial
highlights for each of the years in the two-year period ended March 31, 1997 for
Daily Assets Government Fund were audited by other auditors whose report dated
May 9, 1997 expressed an unqualified opinion on those financial highlights.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of Daily
Asset Treasury Obligations Fund, Daily Assets Government Fund, Daily Assets
Government Obligations Fund, Daily Assets Cash Fund and Daily Assets Municipal
Fund, as of August 31, 2000, the results of their operations, the changes in
their net assets and their financial highlights for the periods indicated above,
in conformity with accounting principles generally accepted in the United States
of America.
/s/ KPMG LLP
Boston, Massachusetts
October 6, 2000
2 FORUM FUNDS(R)
<PAGE>
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STATEMENTS OF ASSETS AND LIABILITIES
AUGUST 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C>
DAILY ASSETS DAILY ASSETS
TREASURY DAILY ASSETS GOVERNMENT
OBLIGATIONS GOVERNMENT OBLIGATIONS
FUND FUND FUND
------------------------ ------------------------ ------------------------
ASSETS
Investments in Portfolios
at value (Notes 1 & 2) $ 116,381,961 $ 43,564,653 $93,043,093
Organization costs, net of
amortization (Note 2) 2,803 - 3,523
Other receivables 601 - -
------------------------ ------------------------ ------------------------
Total assets 116,385,365 43,564,653 93,046,616
------------------------ ------------------------ ------------------------
LIABILITIES
Dividends payable 614,795 196,152 367,856
Accrued expenses - 9,917 17,213
------------------------ ------------------------ ------------------------
Total liabilities 614,795 206,069 385,069
------------------------ ------------------------ ------------------------
NET ASSETS $ 115,770,570 $ 43,358,584 $ 92,661,547
======================== ======================== ========================
COMPONENTS OF NET ASSETS
Paid in capital $ 115,773,754 43,363,296 92,660,270
Undistributed net investment income 2,499 21,264 944
Accumulated net realized gain (loss) (5,683) (25,976) 333
------------------------ ------------------------ ------------------------
NET ASSETS $ 115,770,570 $ 43,358,584 $ 92,661,547
======================== ======================== ========================
NET ASSETS BY SHARE CLASS
Institutional Shares $ 108,371,550 $ 39,777,111 $34,909,036
Institutional Service Shares 7,373,890 3,139,599 57,346,924
Investor Shares 25,130 441,874 405,587
------------------------ ------------------------ ------------------------
NET ASSETS $ 115,770,570 $ 43,358,584 $ 92,661,547
======================== ======================== ========================
SHARES OF BENEFICIAL INTEREST
Institutional Shares 108,374,434 39,781,372 34,908,155
Institutional Service Shares 7,374,188 3,140,164 57,346,528
Investor Shares 25,130 441,941 405,587
NET ASSET VALUE PER SHARE
(OFFERING AND REDEMPTION
PRICE PER SHARE) $ 1.00 $ 1.00 $ 1.00
DAILY ASSETS DAILY ASSETS
CASH MUNICIPAL
FUND FUND
------------------------ ------------------------
ASSETS
Investments in Portfolios
at value (Notes 1 & 2) $ 99,222,562 $ 22,640,641
Organization costs, net of
amortization (Note 2) - -
Other receivables - 23,050
------------------------ ------------------------
Total assets 99,222,562 22,663,691
------------------------ ------------------------
LIABILITIES
Dividends payable 278,453 74,142
Accrued expenses 17,948 -
------------------------ ------------------------
Total liabilities 296,401 74,142
------------------------ ------------------------
NET ASSETS $ 98,926,161 $ 22,589,549
======================== ========================
COMPONENTS OF NET ASSETS
Paid in capital 98,926,605 22,592,944
Undistributed net investment income 48 -
Accumulated net realized gain (loss) (492) (3,395)
------------------------ ------------------------
NET ASSETS $ 98,926,161 $ 22,589,549
======================== ========================
NET ASSETS BY SHARE CLASS
Institutional Shares $ 42,164,921 $ 20,980,123
Institutional Service Shares 52,428,130 1,520,012
Investor Shares 4,333,110 89,414
------------------------ ------------------------
NET ASSETS $ 98,926,161 $ 22,589,549
======================== ========================
SHARES OF BENEFICIAL INTEREST
Institutional Shares 42,165,179 20,983,129
Institutional Service Shares 52,428,312 1,520,391
Investor Shares 4,333,110 89,422
NET ASSET VALUE PER SHARE
(OFFERING AND REDEMPTION
PRICE PER SHARE) $ 1.00 $ 1.00
</TABLE>
See Notes to Financial Statements. 3 FORUM FUNDS[R]
<PAGE>
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STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED AUGUST 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C>
DAILY ASSETS DAILY ASSETS
TREASURY DAILY ASSETS GOVERNMENT
OBLIGATIONS GOVERNMENT OBLIGATIONS
FUND FUND FUND
----------------------- ------------------------ ---------------------
NET INVESTMENT INCOME
ALLOCATED FROM PORTFOLIOS
Interest income $ 6,721,796 $ 1,994,973 $ 4,227,045
Net expenses (150,511) (50,404) (81,548)
----------------------- ------------------------ ---------------------
Net investment income allocated from
Portfolios (Note 2) 6,571,285 1,944,569 4,145,497
----------------------- ------------------------ ---------------------
EXPENSES
Administration (Note 3)
InstitutionalnSharesvice Shares 52,850 14,336 17,381
Institutional Service Shares 4,747 2,038 17,241
Investor Shares 13 331 157
Transfer agent (Note 3)
Institutional Shares 68,496 27,395 30,893
Institutional Service Shares 21,871 17,322 48,623
Investor Shares 12,178 14,255 12,864
Shareholder services (Note 3)
Institutional Service Shares 23,735 10,188 86,205
Investor Shares 67 1,657 787
Distribution - Investor Shares (Note 3) 80 994 945
Accounting (Note 3) 37,500 37,500 37,500
Legal 7,108 3,367 5,362
Audit 8,531 3,539 5,745
Trustees 6,114 1,663 3,392
Compliance 11,411 22,314 18,446
Reporting 6,639 3,774 6,134
Amortization of organization costs (Note 2) 1,173 - 1,461
Miscellaneous 21,816 6,610 14,757
----------------------- ------------------------ ---------------------
Total expenses 284,329 167,283 307,893
Expenses reimbursed and
fees waived (Note 4) (182,035) (136,659) (162,193)
----------------------- ------------------------ ---------------------
Net expenses 102,294 30,624 145,700
----------------------- ------------------------ ---------------------
NET INVESTMENT INCOME 6,468,991 1,913,945 3,999,797
----------------------- ------------------------ ---------------------
NET REALIZED GAIN (LOSS) ON
INVESTMENTS ALLOCATED
FROM PORTFOLIOS (Note 2)
(2) (20) 293
----------------------- ------------------------ ---------------------
NET INCREASE IN NET ASSETS
FROM OPERATIONS $ 6,468,989 $ 1,913,925 $ 4,000,090
======================= ======================== =====================
DAILY ASSETS DAILY ASSETS
CASH MUNICIPAL
FUND FUND
--------------------- ----------------------
NET INVESTMENT INCOME
ALLOCATED FROM PORTFOLIOS
Interest income $ 5,484,110 $ 831,241
Net expenses (102,265) -
--------------------- ----------------------
Net investment income allocated from
Portfolios (Note 2) 5,381,845 831,241
--------------------- ----------------------
EXPENSES
Administration (Note 3)
InstitutionalnSharesvice Shares 20,144 9,905
Institutional Service Shares 23,700 919
Investor Shares 1,097 43
Transfer agent (Note 3)
Institutional Shares 33,738 22,712
Institutional Service Shares 62,582 14,024
Investor Shares 18,316 12,309
Shareholder services (Note 3)
Institutional Service Shares 118,498 4,593
Investor Shares 5,487 217
Distribution - Investor Shares (Note 3) 6,585 260
Accounting (Note 3) 37,500 37,500
Legal 9,553 1,818
Audit 6,985 2,826
Trustees 4,526 1,109
Compliance 14,180 9,940
Reporting 7,732 1,139
Amortization of organization costs (Note 2) - -
Miscellaneous 17,199 4,729
--------------------- ----------------------
Total expenses 387,822 124,043
Expenses reimbursed and
fees waived (Note 4) (176,156) (114,969)
--------------------- ----------------------
Net expenses 211,666 9,074
--------------------- ----------------------
NET INVESTMENT INCOME 5,170,179 822,167
--------------------- ----------------------
NET REALIZED GAIN (LOSS) ON
INVESTMENTS ALLOCATED
FROM PORTFOLIOS (Note 2)
(278) -
--------------------- ----------------------
NET INCREASE IN NET ASSETS
FROM OPERATIONS $ 5,169,901 $ 822,167
===================== ======================
</TABLE>
See Notes to Financial Statements. 4 FORUM FUNDS[R]
<PAGE>
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STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED AUGUST 31, 1999 AND AUGUST 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
DAILY ASSETS
TREASURY DAILY ASSETS
OBLIGATIONS GOVERNMENT
FUND FUND
------------------------ -------------------------
NET ASSETS - August 31, 1998 (Note 1) $ 115,019,392 $ 45,579,939
------------------------ -------------------------
OPERATIONS
Net investment income 4,787,343 1,915,349
Net realized gain (loss) on investments allocated from Portfolios (5,681) (5,049)
------------------------ -------------------------
Net increase in net assets resulting from operations 4,781,662 1,910,300
------------------------ -------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM
Net investment income-Institutional Shares (4,483,542) (1,574,915)
Net investment income-Institutional Service Shares (300,597) (318,474)
Net investment income-Investor Shares (705) (20,150)
Net realized gain on investments-Institutional Shares (2,437) -
Net realized gain on investments-Investor Shares (62) (1,810)
------------------------ -------------------------
------------------------ -------------------------
Total distributions to shareholders (4,787,343) (1,915,349)
------------------------ -------------------------
CAPITAL SHARE TRANSACTIONS (at $1.00 per share)
Sale of shares-Institutional Shares 369,559,185 30,771,529
Sale of shares-Institutional Service Shares 40,662,099 24,286,868
Sale of shares-Investor Shares 26,758 2,002,096
Reinvestment of distributions-Institutional Shares - 4,597
Reinvestment of distributions-Institutional Service Shares 98,927 266,959
Reinvestment of distributions-Investor Shares 706 18,772
Redemption of shares-Institutional Shares (393,819,939) (38,157,589)
Redemption of shares-Institutional Service Shares (26,839,236) (28,262,648)
Redemption of shares-Investor Shares (5,000) (1,317,421)
------------------------ -------------------------
Net increase (decrease) from capital share transactions (10,316,500) (10,386,837)
------------------------ -------------------------
------------------------ -------------------------
Net increase (decrease) in net assets (10,322,181) (10,391,886)
------------------------ -------------------------
NET ASSETS -August 31, 1999 (Including (A)) 104,697,211 35,188,053
------------------------ -------------------------
OPERATIONS
Net investment income 6,468,991 1,913,945
Net realized gain (loss) on investments allocated from Portfolios (2) (20)
------------------------ -------------------------
Net increase in net assets resulting from operations 6,468,989 1,913,925
------------------------ -------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM
Net investment income-Institutional Shares (5,969,386) (1,658,257)
Net investment income-Institutional Service Shares (498,320) (221,740)
Net investment income-Investor Shares (1,285) (33,948)
Net realized gain on investments-Institutional Shares - -
Net realized gain on investments-Institutional Service Shares - -
Net realized gain on investments-Investor Shares - -
------------------------ -------------------------
------------------------ -------------------------
Total distributions to shareholders (6,468,991) (1,913,945)
------------------------ -------------------------
CAPITAL SHARE TRANSACTIONS (at $1.00 per share)
Sale of shares-Institutional Shares 391,820,898 44,172,772
Sale of shares-Institutional Service Shares 69,946,152 18,687,757
Sale of shares-Investor Shares 12,003 1,261,429
Reinvestment of distributions-Institutional Shares 247,630 10,059
Reinvestment of distributions-Institutional Service Shares 316,192 161,715
Reinvestment of distributions-Investor Shares 1,285 33,922
Redemption of shares-Institutional Shares (369,992,226) (33,114,870)
Redemption of shares-Institutional Service Shares (81,257,826) (21,485,273)
Redemption of shares-Investor Shares (20,747) (1,556,960)
------------------------ -------------------------
------------------------ -------------------------
Net increase from capital share transactions 11,073,361 8,170,551
------------------------ -------------------------
------------------------ -------------------------
Net increase in net assets 11,073,359 8,170,531
------------------------ -------------------------
NET ASSETS - August 31, 2000 (Including (B)) $ 115,770,570 $ 43,358,584
======================== =========================
(A) Accumulated undistributed net investment income, August 31, 1999 $ 2,499 $ 21,264
======================== =========================
(B) Accumulated undistributed net investment income, August 31, 2000 $ 2,499 $ 21,264
======================== =========================
DAILY ASSETS
GOVERNMENT
OBLIGATIONS
FUND
------------------------
NET ASSETS - August 31, 1998 (Note 1) $ 17,751,966
------------------------
OPERATIONS
Net investment income 2,111,004
Net realized gain (loss) on investments allocated from Portfolios 1,020
------------------------
Net increase in net assets resulting from operations 2,112,024
------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM
Net investment income-Institutional Shares (1,495,037)
Net investment income-Institutional Service Shares (615,530)
Net investment income-Investor Shares (437)
Net realized gain on investments-Institutional Shares -
Net realized gain on investments-Investor Shares -
------------------------
------------------------
Total distributions to shareholders (2,111,004)
------------------------
CAPITAL SHARE TRANSACTIONS (at $1.00 per share)
Sale of shares-Institutional Shares 78,503,113
Sale of shares-Institutional Service Shares 183,158,610
Sale of shares-Investor Shares -
Reinvestment of distributions-Institutional Shares -
Reinvestment of distributions-Institutional Service Shares 358,305
Reinvestment of distributions-Investor Shares 437
Redemption of shares-Institutional Shares (67,229,404)
Redemption of shares-Institutional Service Shares (163,578,891)
Redemption of shares-Investor Shares -
------------------------
Net increase (decrease) from capital share transactions 31,212,170
------------------------
------------------------
Net increase (decrease) in net assets 31,213,190
------------------------
NET ASSETS -August 31, 1999 (Including (A)) 48,965,156
------------------------
OPERATIONS
Net investment income 3,999,797
Net realized gain (loss) on investments allocated from Portfolios 293
------------------------
Net increase in net assets resulting from operations 4,000,090
------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM
Net investment income-Institutional Shares (2,026,122)
Net investment income-Institutional Service Shares (1,955,945)
Net investment income-Investor Shares (16,786)
Net realized gain on investments-Institutional Shares (356)
Net realized gain on investments-Institutional Service Shares (584)
Net realized gain on investments-Investor Shares (4)
------------------------
------------------------
Total distributions to shareholders (3,999,797)
------------------------
CAPITAL SHARE TRANSACTIONS (at $1.00 per share)
Sale of shares-Institutional Shares 81,354,185
Sale of shares-Institutional Service Shares 317,529,921
Sale of shares-Investor Shares 2,058,820
Reinvestment of distributions-Institutional Shares 89,225
Reinvestment of distributions-Institutional Service Shares 1,101,795
Reinvestment of distributions-Investor Shares 16,790
Redemption of shares-Institutional Shares (73,161,064)
Redemption of shares-Institutional Service Shares (283,612,987)
Redemption of shares-Investor Shares (1,680,587)
------------------------
------------------------
Net increase from capital share transactions 43,696,098
------------------------
------------------------
Net increase in net assets 43,696,391
------------------------
NET ASSETS - August 31, 2000 (Including (B)) $ 92,661,547
========================
(A) Accumulated undistributed net investment income, August 31, 1999 $ -
========================
(B) Accumulated undistributed net investment income, August 31, 2000 $ 944
========================
</TABLE>
See Notes to Financial Statements. 5 FORUM FUNDS[R]
<PAGE>
--------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS (Concluded)
FOR THE YEARS ENDED AUGUST 31, 1999 AND AUGUST 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
DAILY ASSETS DAILY ASSETS
CASH MUNICIPAL
FUND FUND
------------------------ ------------------------
NET ASSETS - August 31, 1998 (Note 1) $ 33,641,074 $ 20,793,306
------------------------ ------------------------
OPERATIONS
Net investment income 3,420,261 875,578
Net realized loss on investments allocated from Portfolios (123) (3,395)
------------------------ ------------------------
Net increase in net assets resulting from operations 3,420,138 872,183
------------------------ ------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM
Net investment income-Institutional Shares (1,992,738) (805,513)
Net investment income-Institutional Service Shares (1,418,542) (68,996)
Net investment income-Investor Shares (8,933) (1,069)
Net realized gain on investments-Institutional Service Shares (48) -
------------------------ ------------------------
Total distributions to shareholders (3,420,261) (875,578)
------------------------ ------------------------
CAPITAL SHARE TRANSACTIONS (at $1.00 per share)
Sale of shares-Institutional Shares 229,434,759 105,434,496
Sale of shares-Institutional Service Shares 409,749,879 22,597,633
Sale of shares-Investor Shares 587,671 64,674
Reinvestment of distributions-Institutional Shares 59,332 48,954
Reinvestment of distributions-Institutional Service Shares 868,037 68,997
Reinvestment of distributions-Investor Shares 6,493 1,067
Redemption of shares-Institutional Shares (218,964,209) (105,629,785)
Redemption of shares-Institutional Service Shares (357,192,027) (19,381,291)
Redemption of shares-Investor Shares (146,154) -
------------------------ ------------------------
Net increase from capital share transactions 64,403,781 3,204,745
------------------------ ------------------------
------------------------ ------------------------
Net increase in net assets 64,403,658 3,201,350
------------------------ ------------------------
NET ASSETS - August 31, 1999 (Including (A)) 98,044,732 23,994,656
------------------------ ------------------------
OPERATIONS
Net investment income 5,170,179 822,167
Net realized loss on investments allocated from Portfolios (278) -
------------------------ ------------------------
Net increase in net assets resulting from operations 5,169,901 822,167
------------------------ ------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM
Net investment income-Institutional Shares (2,388,613) (758,545)
Net investment income-Institutional Service Shares (2,659,138) (61,056)
Net investment income-Investor Shares (122,428) (2,566)
Net realized gain on investments-Institutional Shares - -
Net realized gain on investments-Institutional Service Shares - -
Net realized gain on investments-Investor Shares - -
------------------------ ------------------------
------------------------ ------------------------
Total distributions to shareholders (5,170,179) (822,167)
------------------------ ------------------------
CAPITAL SHARE TRANSACTIONS (at $1.00 per share)
Sale of shares-Institutional Shares 261,999,458 77,357,529
Sale of shares-Institutional Service Shares 489,640,275 14,533,707
Sale of shares-Investor Shares 9,114,428 11,000
Reinvestment of distributions-Institutional Shares 351,422 55,053
Reinvestment of distributions-Institutional Service Shares 2,058,692 61,056
Reinvestment of distributions-Investor Shares 16,394 2,566
Redemption of shares-Institutional Shares (259,111,398) (77,056,291)
Redemption of shares-Institutional Service Shares (497,931,725) (16,369,727)
Redemption of shares-Investor Shares (5,255,839) -
------------------------ ------------------------
------------------------ ------------------------
Net increase (decrease) from capital share transactions 881,707 (1,405,107)
------------------------ ------------------------
------------------------ ------------------------
Net increase (decrease) in net assets 881,429 (1,405,107)
------------------------ ------------------------
NET ASSETS - August 31, 2000 (Including (B)) $ 98,926,161 $ 22,589,549
======================== ========================
(A) Accumulated undistributed net investment income, August 31, 1999 $ 48 $ -
======================== ========================
(B) Accumulated undistributed net investment income, August 31, 2000 $ 48 $ -
======================== ========================
</TABLE>
See Notes to Financial Statements. 6 FORUM FUNDS[R]
<PAGE>
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
These financial highlights reflect selected data for a share of each class of
each Fund outstanding during the years or periods indicated.
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Ratios to Average
Distributions Distributions Net Assets
Beginning Net from Net from Net Ending Net
Net Asset Investment Investment Realized Net Asset Net Investment
Value Income Income Gains Value Expenses Income
DAILY ASSETS TREASURY
OBLIGATIONS FUND
Institutional Shares
Year Ended August 31, 2000 $ 1.00 0.06 (0.06) $ 1.00 0.20% 5.65%
Year Ended August 31, 1999 1.00 0.05 (0.05) (e) 1.00 0.20% 4.58%
Period Ended August 31, 1998 (b) 1.00 0.03 (0.03) 1.00 0.20% (c) 5.41% (c)
Institutional Service Shares
Year Ended August 31, 2000 1.00 0.05 (0.05) 1.00 0.45% 5.25%
Year Ended August 31, 1999 1.00 0.04 (0.04) 1.00 0.45% 4.34%
Period Ended August 31, 1998 (b) 1.00 0.02 (0.02) 1.00 0.45% (c) 5.16% (c)
Investor Shares
Year Ended August 31, 2000 1.00 0.05 (0.05) 1.00 0.90% 4.81%
Year Ended August 31, 1999 1.00 0.04 (0.04) (e) 1.00 0.87% 3.87%
Period Ended August 31, 1998 (b) 1.00 0.02 (0.02) 1.00 0.78% (c) 5.06% (c)
DAILY ASSETS
GOVERNMENT FUND
Institutional Shares
Year Ended August 31, 2000 1.00 0.06 (0.06) 1.00 0.20% 5.78%
Year Ended August 31, 1999 1.00 0.05 (0.05) 1.00 0.20% 4.81%
Period Ended August 31, 1998 (b) 1.00 0.01 (0.01) 1.00 0.20% (c) 5.26% (c)
Institutional Service Shares
Year Ended August 31, 2000 1.00 0.06 (0.06) 1.00 0.45% 5.44%
Year Ended August 31, 1999 1.00 0.05 (0.05) 1.00 0.45% 4.57%
Year Ended August 31, 1998 1.00 0.05 (0.05) 1.00 0.46% 4.93%
Period Ended August 31, 1997 (d) 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%
Investor Shares
Year Ended August 31, 2000 1.00 0.05 (0.05) 1.00 0.75% 5.12%
Period Ended August 31, 1999 (b) 1.00 0.04 (0.04) (e) 1.00 0.75% (c) 4.25% (c)
DAILY ASSETS GOVERNMENT
OBLIGATIONS FUND
Institutional Shares
Year Ended August 31, 2000 1.00 0.06 (0.06) (e) 1.00 0.20% 5.83%
Year Ended August 31, 1999 1.00 0.05 (0.05) 1.00 0.20% 4.85%
Period Ended August 31, 1998 (b) 1.00 0.03 (0.03) 1.00 0.20% (c) 5.43% (c)
Institutional Service Shares
Year Ended August 31, 2000 1.00 0.06 (0.06) (e) 1.00 0.45% 5.67%
Year Ended August 31, 1999 1.00 0.05 (0.05) 1.00 0.45% 4.54%
Period Ended August 31, 1998 (b) 1.00 0.02 (0.02) 1.00 0.45% (c) 5.16% (c)
Investor Shares
Year Ended August 31, 2000 1.00 0.05 (0.05) (e) 1.00 0.90% 5.33%
Year Ended August 31, 1999 1.00 0.04 (0.04) 1.00 0.84% 4.24%
Period Ended August 31, 1998 (b) 1.00 0.02 (0.02) 1.00 0.78% (c) 5.06% (c)
</TABLE>
Ratio to
Average
Net Assets at Net Assets
Total End of Period Gross
Return (000's Omitted Expenses (a)
DAILY ASSETS TREASURY
OBLIGATIONS FUND
Institutional Shares
Year Ended August 31, 2000 5.74% $ 108,372 0.33%
Year Ended August 31, 1999 4.67% 86,295 0.32%
Period Ended August 31, 1998 (b) 3.34% 110,561 0.47% (c)
Institutional Service Shares
Year Ended August 31, 2000 5.48% 7,374 0.78%
Year Ended August 31, 1999 4.46% 18,369 0.89%
Period Ended August 31, 1998 (b) 2.19% 4,448 1.53% (c)
Investor Shares
Year Ended August 31, 2000 5.00% 25 57.02%
Year Ended August 31, 1999 4.00% 33 100.05%
Period Ended August 31, 1998 (b) 0.33% 10 727.11% (c)
DAILY ASSETS
GOVERNMENT FUND
Institutional Shares
Year Ended August 31, 2000 5.93% 39,777 0.65%
Year Ended August 31, 1999 4.92% 28,709 0.61%
Period Ended August 31, 1998 (b) 0.89% 36,095 0.69% (c)
Institutional Service Shares
Year Ended August 31, 2000 5.66% 1.37%
Year Ended August 31, 1999 4.66% 5,775 1.15%
Year Ended August 31, 1998 5.04% 9,485 0.91%
Period Ended August 31, 1997 (d) 2.01% 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%
Investor Shares
Year Ended August 31, 2000 5.35% 442 4.28%
Period Ended August 31, 1999 (b) 4.43% 703 5.45% (c)
DAILY ASSETS GOVERNMENT
OBLIGATIONS FUND
Institutional Shares
Year Ended August 31, 2000 5.94% 34,909 0.37%
Year Ended August 31, 1999 4.98% 26,627 0.40%
Period Ended August 31, 1998 (b) 3.24% 15,352 0.74% (c)
Institutional Service Shares
Year Ended August 31, 2000 5.68% 57,347 0.70%
Year Ended August 31, 1999 4.72% 22,328 0.80%
Period Ended August 31, 1998 (b) 2.22% 2,390 2.13% (c)
Investor Shares
Year Ended August 31, 2000 5.21% 406 6.24%
Year Ended August 31, 1999 4.32% 11 148.94%
Period Ended August 31, 1998 (b) 0.35% 10 766.21% (c)
(a) The ratio of Gross Expenses to Average Net Assets reflects the expense
ratio excluding any fee waivers and expense reimbursements for the Fund and
its corresponding Portfolio.
(b) See Note 1 of Notes to Financial Statements for date of commencement of
operations.
(c) Annualized.
(d) Effective June 19, 1997, the Fund changed its fiscal year end from March 31
to August 31.
(e) Less than $0.01 per share.
See Notes to Financial Statements. 7 FORUM FUNDS[R]
<PAGE>
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (Concluded)
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
Ratios to Average
Distributions Net Assets
Beginning Net from Net Ending Net Net Assets at
Net Asset Investment Investment Net Asset Net Investment Total End of Period
Value Income Income Value Expenses Income Return (000's Omitted)
DAILY ASSETS CASH FUND
Institutional Shares
Year Ended August 31, 2000 $ 1.00 0.06 (0.06) $ 1.00 0.20% 5.93% 6.05% $ 42,165
Year Ended August 31, 1999 1.00 0.05 (0.05) 1.00 0.20% 4.93% 5.07% 38,926
Period Ended August 31, 1998 (b) 1.00 0.03 (0.03) 1.00 0.20% (c)5.46%(c) 2.70% 28,396
Institutional Service Shares
Year Ended August 31, 2000 1.00 0.06 (0.06) 1.00 0.45% 5.61% 5.78% 52,428
Year Ended August 31, 1999 1.00 0.05 (0.05) 1.00 0.45% 4.59% 4.81% 58,661
Year Ended August 31, 1998 1.00 0.05 (0.05) 1.00 0.46% 5.22% 5.34% 5,235
Period Ended August 31, 1997 (b) 1.00 0.05 (0.05) 1.00 0.52% (c)5.06%(c) 4.70% 12,076
Investor Shares
Year Ended August 31, 2000 1.00 0.05 (0.05) 1.00 0.90% 5.58% 5.31% 4,333
Year Ended August 31, 1999 1.00 0.04 (0.04) 1.00 0.90% 4.13% 4.40% 458
Period Ended August 31, 1998 (b) 1.00 0.02 (0.02) 1.00 0.78% (c)5.25%(c) 0.37% 10
DAILY ASSETS
MUNICIPAL FUND
Institutional Shares
Year Ended August 31, 2000 1.00 0.04 (0.04) 1.00 0.00% 3.83% 3.92% 20,980
Year Ended August 31, 1999 1.00 0.03 (0.03) 1.00 0.05% 3.10% 3.15% 20,624
Period Ended August 31, 1998 (b) 1.00 0.01 (0.01) 1.00 0.12% (c)3.16%(c) 0.59% 20,773
Institutional Service Shares
Year Ended August 31, 2000 1.00 0.03 (0.03) 1.00 0.45% 3.32% 3.45% 1,520
Year Ended August 31, 1999 1.00 0.03 (0.03) 1.00 0.45% 2.66% 2.77% 3,295
Period Ended August 31, 1998 (b) 1.00 - 1.00 0.59% (c)2.76%(c) 0.20% 10
Investor Shares
Year Ended August 31, 2000 1.00 0.03 (0.03) 1.00 0.90% 2.96% 2.99% 89
Year Ended August 31, 1999 1.00 0.02 (0.02) 1.00 0.88% 2.23% 2.36% 76
Period Ended August 31, 1998 (b) 1.00 0.01 (0.01) 1.00 0.78% (c)2.53%(c) 0.18% 10
</TABLE>
Ratio to
Average
Net Assets
Gross
Expenses (a)
DAILY ASSETS CASH FUND
Institutional Shares
Year Ended August 31, 2000 0.34%
Year Ended August 31, 1999 0.35%
Period Ended August 31, 1998 (b) 0.68% (c)
Institutional Service Shares
Year Ended August 31, 2000 0.66%
Year Ended August 31, 1999 0.70%
Year Ended August 31, 1998 0.90%
Period Ended August 31, 1997 (b) 1.22% (c)
Investor Shares
Year Ended August 31, 2000 1.84%
Year Ended August 31, 1999 9.24%
Period Ended August 31, 1998 (b) 709.02% (c)
DAILY ASSETS
MUNICIPAL FUND
Institutional Shares
Year Ended August 31, 2000 0.88%
Year Ended August 31, 1999 0.72%
Period Ended August 31, 1998 (b) 1.26% (c)
Institutional Service Shares
Year Ended August 31, 2000 1.96%
Year Ended August 31, 1999 1.21%
Period Ended August 31, 1998 (b) 721.84% (c)
Investor Shares
Year Ended August 31, 2000 18.94%
Year Ended August 31, 1999 33.51%
Period Ended August 31, 1998 (b) 749.20% (c)
(a) The ratio of Gross Expenses to Average Net Assets reflects the expense
ratio excluding any fee waivers and expense reimbursements for the Fund and
its corresponding Portfolio.
(b) See Note 1 of Notes to Financial Statements for date of commencement of
operations.
(c) Annualized.
(d) Effective June 19, 1997, the Fund changed its fiscal year end from March 31
to August 31.
See Notes to Financial Statements. 8 FORUM FUNDS[R]
<PAGE>
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
AUGUST 31, 2000
--------------------------------------------------------------------------------
NOTE 1. SUMMARY OF ORGANIZATION
Forum Funds(R) (the "Trust") is a Delaware business trust that is registered as
an open-end management investment company under the Investment Company Act of
1940, as amended (the "Act"). The Trust currently has twenty-one active
investment portfolios. These financial statements relate to Daily Assets
Treasury Obligations Fund, Daily Assets Government Fund, Daily Assets Government
Obligations Fund, Daily Assets Cash Fund and Daily Assets Municipal Fund
(individually, 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 Obligations Fund (Institutional Shares) January 22, 1998
Daily Assets Treasury Obligations Fund (Institutional Service Shares) April 1, 1998
Daily Assets Treasury Obligations Fund (Investor Shares) August 6, 1998
Daily Assets Government Fund (Institutional Shares) July 1, 1998
Daily Assets Government Fund (Institutional Service Shares) July 1, 1992
Daily Assets Government Fund (Investor Shares) September 29, 1998
Daily Assets Government Obligations Fund (Institutional Shares) January 30, 1998
Daily Assets Government Obligations Fund (Institutional Service Shares) March 30, 1998
Daily Assets Government Obligations Fund (Investor Shares) August 6, 1998
Daily Assets Cash Fund (Institutional Shares) March 13, 1998
Daily Assets Cash Fund (Institutional Service Shares) October 1, 1996
Daily Assets Cash Fund (Investor Shares) August 6, 1998
Daily Assets Municipal Fund (Institutional Shares) June 25, 1998
Daily Assets Municipal Fund (Institutional Service Shares) August 6, 1998
Daily Assets Municipal Fund (Investor Shares) August 6, 1998
</TABLE>
MASTER-FEEDER ARRANGEMENT - Each Fund currently seeks to achieve its investment
objective by investing all its investable assets in a separate portfolio
(individually, a "Portfolio" and collectively, the "Portfolios") of Core Trust
(Delaware) ("Core Trust"), a registered open-end management investment company
that has the same investment objective and substantially similar policies as the
Fund. Accordingly, each Portfolio directly acquires securities, and a Fund
investing in the Portfolio acquires an indirect interest in those securities.
This is commonly referred to as a master-feeder arrangement. Each Fund accounts
for its investment in a Portfolio as a partnership investment, and records daily
its share of the Portfolio's income, expenses and realized and unrealized gain
and loss. In addition, each Fund incurs its own expenses. Each Fund may withdraw
its investment from its corresponding Portfolio at any time if the Trust's Board
of Trustees (the "Board") determines that it is in the best interest of the Fund
and its shareholders to do so.
The financial statements of the Portfolios are included elsewhere in this report
and should be read in conjunction with the Funds' financial statements. As of
August 31, 2000, the percentage of Treasury Cash Portfolio owned by Daily Assets
Treasury Obligations Fund was 24.9%; the Daily Assets Government Fund owned
substantially all the interests of Government Portfolio; the percentage of
Government Cash Portfolio owned by Daily Assets Government Obligations Fund was
12.3%; the percentage of Cash Portfolio owned by Daily Assets Cash Fund was
4.9%; and the Daily Assets Municipal Fund owned substantially all of the
interests of Municipal Cash Portfolio.
9 FORUM FUNDS[R]
<PAGE>
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (Continued)
AUGUST 31, 2000
--------------------------------------------------------------------------------
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
These financial statements are prepared in accordance with accounting principles
generally accepted in the United States of America which require management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities, disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of increase and decrease in net
assets during the fiscal period. Actual results could differ from those
estimates. The following summarizes the significant accounting policies of the
Funds:
SECURITY VALUATION - Each Fund determines its net asset value per share as of
4:00 p.m., Eastern time, on each Fund business day. Each Fund records its
investment in its Portfolio at value. The valuation of securities held in the
Portfolios is discussed in the Notes to Financial Statements of Core Trust
(Delaware), which are included elsewhere in this report.
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.
ORGANIZATION COSTS - The costs incurred by the Daily Assets Treasury Obligations
Fund and Daily Assets Government Obligations 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.
CLASS SPECIFIC EXPENSES - Each share of each class of a Fund represents an
undivided, proportionate interest in the Fund. The Funds' class specific
expenses include administration fees, shareholder servicing fees, transfer agent
fees and certain other expenses as determined by the Trust's Board.
Institutional Shares and Investor Shares incur shareholder servicing fees and
Investor Shares incur distribution fees. In addition, there are differences
between the classes of shares with respect to the minimum investment required.
FEDERAL TAXES - Each Fund intends to continue to qualify each year as a
regulated investment company and distribute all its net investment income. In
addition, by distributing in each calendar year substantially all its net
investment income, capital gain and certain other amounts, each Fund will not be
subject to a federal excise tax. Therefore, no federal income or excise tax
provision is required.
As of August 31, 2000, the following funds had capital loss carryovers available
to offset future capital gains: Daily Assets Government Fund in the amounts of
$19,024, expiring in August 2006, $986, expiring in August 2007 and $3,602,
expiring in August 2008; Daily Assets Treasury Obligation Fund in the amount of
$5,683, expiring in August 2008; Daily Assets Municipal Fund in the amount of
$3,395, expiring in August 2008; and Daily Assets Cash Fund in the amount of
$123, expiring in August 2008.
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, which
may differ from accounting principles generally accepted in the United States of
America. These differences are due primarily to differing treatments of income
and gain on various investment securities held by each Fund or Portfolio, timing
differences and differing characterizations of distributions made by the Fund.
10 FORUM FUNDS[R]
<PAGE>
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (Continued)
AUGUST 31, 2000
--------------------------------------------------------------------------------
NOTE 3. INVESTMENT ADVISORY AND OTHER SERVICES
INVESTMENT ADVISER - The investment adviser of each Portfolio is Forum
Investment Advisors, LLC ("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. Forum Advisors receives an advisory fee from Government
Portfolio and Municipal Cash Portfolio at an annual rate of 0.05% of the average
daily net assets of each Portfolio.
ADMINISTRATOR - The administrator of the Funds is Forum Administrative Services,
LLC ("FAdS"). For its administrative services and facilities, FAdS receives from
each Fund a fee at an annual rate of 0.05% of the average daily net assets
attributable to the Institutional Shares, Institutional Service Shares and
Investor Shares of the Fund. In addition, certain legal expenses are charged to
the Funds by FAdS.
TRANSFER AGENT - The transfer agent and dividend disbursing agent for the Funds
is Forum Shareholder Services, LLC ("FSS"). FSS is paid a transfer agent fee at
an annual rate of 0.05%, 0.10% and 0.25% of the average daily net assets
attributable to the Institutional Shares, Institutional Service Shares and
Investor Shares of each Fund, respectively, plus certain account and additional
Fund charges.
SHAREHOLDER SERVICE AGENT - The Trust has adopted a shareholder servicing plan
with respect to Institutional Service Shares and Investor Shares under which the
Trust pays FAdS a shareholder servicing fee at an annual rate of 0.25% of the
average daily net assets attributable to the Institutional Service Shares and
Investor Shares of each Fund. FAdS may pay any or all amounts of these payments
to various institutions that provide shareholder servicing to their customers
who hold Institutional Service Shares or Investor Shares.
DISTRIBUTOR - Forum Fund Services, LLC ("FFS"), a registered broker-dealer and a
member of the National Association of Securities Dealers, Inc., acts as each
Fund's distributor. The Trust has adopted a Distribution Plan pursuant to Rule
12b-1 under the Act with respect to the Investor Shares under which the Trust
may pay FFS a distribution fee at an annual rate of up to 0.15% of the average
daily net assets of the Investor Share class of Daily Assets Government Fund and
up to 0.50% of the average daily net assets of the Investor Share class of each
other Fund. The Board's approval of the plan, however, is subject to the
condition that FFS would not charge a distribution fee of more than 0.30% of the
average daily net assets of each Fund (except Daily Assets Government Fund)
without seeking Board approval. FFS may pay any or all amounts of these payments
to various institutions that provide distribution or shareholder services for
Investor Shares. The plan obligates the Funds to pay FFS as compensation for
FFS's services and not as reimbursement for certain expenses incurred.
OTHER SERVICE PROVIDERS - Forum Accounting Services, LLC ("FAcS") provides fund
accounting services to the Funds. For its accounting services, FAcS receives
from each Fund an annual fee of $37,500.
11 FORUM FUNDS[R]
<PAGE>
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (Concluded)
AUGUST 31, 2000
--------------------------------------------------------------------------------
NOTE 4. WAIVER OF FEES AND REIMBURSEMENT OF EXPENSES
FAdS, FSS, FFS and FAcS have voluntarily waived a portion of their fees and FAdS
has also assumed certain expenses of the Funds. For the fiscal year ended August
31, 2000, fees waived and expenses reimbursed were as follows:
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
Administration Transfer Shareholder 12b-1 Accounting Reimbursed
Fee Agent Fee Service Fee Fee Fee Expenses Total
--- --------- ----------- --- --- -------- -----
Daily Assets Treasury Obligations Fund $57,610 $10,756 $9,953 $80 $37,500 $66,136 $182,035
Institutional Shares 52,850 5,745 - -
Institutional Service Shares 4,747 951 9,886 -
Investor Shares 13 4,060 67 80
Daily Assets Government Fund 16,705 32,751 11,845 994 37,500 36,864 136,659
Institutional Shares 14,336 18,354 - -
Institutional Service Shares 2,038 8,518 10,188 -
Investor Shares 331 5,879 1,657 994
Daily Assets Government Obligations Fund 31,040 25,644 21,477 153 37,500 46,379 162,193
Institutional Shares 17,381 9,364 - -
Institutional Service Shares 13,502 11,569 21,140 -
Investor Shares 157 4,711 337 153
Daily Assets Cash Fund 39,394 32,197 29,731 2,950 37,500 34,384 176,156
Institutional Shares 20,144 12,708 - -
Institutional Service Shares 18,193 10,670 28,787 -
Investor Shares 1,057 8,819 944 2,950
Daily Assets Municipal Fund 10,867 14,835 2,131 260 37,500 49,376 114,969
Institutional Shares 9,905 5,767 - -
Institutional Service Shares 919 4,933 1,914 -
Investor Shares 43 4,135 217 260
</TABLE>
NOTE 5. FEDERAL INCOME TAX STATUS OF DIVIDENDS
All dividends distributed by Daily Assets Municipal Fund for the year ended
August 31, 2000, are exempt from federal income tax, other than alternative
minimum tax.
12 FORUM FUNDS[R]
<PAGE>
--------------------------------------------------------------------------------
INDEPENDENT AUDITORS' REPORT
--------------------------------------------------------------------------------
The Trustees and Interestholders
Core Trust (Delaware)
We have audited the accompanying statements of assets and liabilities of
Treasury Cash Portfolio, Government Portfolio, Government Cash Portfolio, Cash
Portfolio and Municipal Cash Portfolio, each a series of Core Trust (Delaware)
(the Portfolios), including the schedules of investments, as of August 31, 2000,
and the related statements of operations for the year then ended and the
statements of changes in net assets for each of the years in the two-year period
then ended. These financial statements are the responsibility of the Portfolios'
management. Our responsibility is to express an opinion on these financial
statements based on our audits. The income and expense ratios for the periods
ending prior to April 1, 1997 for Government Portfolio, were audited by other
auditors whose report dated May 9, 1997 expressed an unqualified opinion on
those income and expense ratios.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
August 31, 2000 by correspondence with the custodian. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Treasury Cash Portfolio,
Government Portfolio, Government Cash Portfolio, Cash Portfolio and Municipal
Cash Portfolio as of August 31, 2000, the results of their operations for the
year then ended and the changes in their net assets for each of the years in the
two-year period then ended, in conformity with accounting principles generally
accepted in the United States of America.
/s/ KPMG LLP
Boston, Massachusetts
October 6, 2000
13 FORUM FUNDS[R]
<PAGE>
------------------------------------------------------------------
SCHEDULE OF INVESTMENTS - TREASURY CASH PORTFOLIO
AUGUST 31, 2000
------------------------------------------------------------------
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------------- --------------------------------- ---------------
U.S. TREASURY BILLS (A) (79.9%)
$ 375,000,000 6.48%, 9/21/00 $373,677,083
---------------
REPURCHASE AGREEMENTS (20.1%)
20,000,000 Banc of America Securities Corp.,
6.40%, 9/1/00, to be repurchased at
$20,003,556, collateralized by various
U.S. Treasury Obligations. 20,000,000
40,000,000 Donaldson, Lufkin & Jenrette Securities
Corp., 6.60%, 9/1/00, to be repurchased
at $40,007,333; collateralized by
various U.S. Treasury Obligations. 40,000,000
33,800,000 Salomon Smith Barney, 6.58%, 9/1/00,
to be repurchased at $33,806,178;
collateralized by various U.S. Treasury
Obligations. 33,800,000
---------------
---------------
Total Repurchase Agreements 93,800,000
---------------
Total Investments (100.0%) at Amortized Cost $467,477,083
===============
See Notes to Financial Statements
and Notes to Schedules of Investments. 14 FORUM FUNDS[R]
<PAGE>
---------------------------------------------------------------
SCHEDULE OF INVESTMENTS - GOVERNMENT PORTFOLIO
AUGUST 31, 2000
---------------------------------------------------------------
FACE SECURITY
AMOUNT DESCRIPTION VALUE
-------------- --------------------------------- --------------
U.S. GOVERNMENT SECURITIES (98.7%)
FEDERAL HOME LOAN BANK (B) (16.1%)
$ 7,000,000 6.67%, 4/12/01 $ 7,000,000
--------------
FEDERAL HOME LOAN BANK - DISCOUNT NOTES (A) (59.6%)
1,000,000 6.54%, 9/6/00 999,115
12,000,000 6.65%, 9/7/00 11,987,105
1,500,000 6.58%, 9/27/00 1,493,024
1,500,000 6.67%, 9/29/00 1,492,475
8,000,000 6.53%, 10/11/00 7,943,467
2,000,000 6.54%, 10/13/00 1,985,137
--------------
Total Federal Home Loan Bank - Discount Notes 25,900,323
--------------
STUDENT LOAN MARKETING ASSOCIATION (B) (23.0%)
10,000,000 6.76%, 2/21/01 10,000,000
--------------
Total U.S. Government Securities 42,900,323
--------------
CASH MANAGEMENT ACCOUNTS (1.3%)
579,061 Dreyfus Treasury Prime Cash
Management Fund, "A", 6.06% yield 579,061
--------------
Total Investments (100.0%) at Amortized Cost $43,479,384
==============
See Notes to Financial Statements
and Notes to Schedules of Investments. 15 FORUM FUNDS[R]
<PAGE>
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS - GOVERNMENT CASH PORTFOLIO
AUGUST 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C> <C>
FACE SECURITY FACE SECURITY
AMOUNT DESCRIPTION VALUE AMOUNT DESCRIPTION VALUE
--------------- ------------------------------- ------------- ------------ ------------------------------ --------------
U.S. GOVERNMENT SECURITIES (86.8%) SMALL BUSINESS ADMINISTRATION (CONCLUDED)
$ 1,647,687 Pool #503461, 7.25%, 9/25/21 $ 1,648,356
FEDERAL HOME LOAN BANK (B) (7.3%) 824,116 Pool #503472, 7.25%, 8/25/21 824,541
$30,000,000 6.62%, 10/12/00 $30,000,000 608,246 Pool #503553, 7.13%, 11/25/21 606,893
25,000,000 6.67%, 4/12/01 25,000,000 2,812,514 Pool #503671, 7.13%, 3/25/22 2,812,514
-------------
TOTAL FEDERAL HOME LOAN BANK 55,000,000 1,154,892 Pool #503754, 7.13%, 5/25/22 1,154,892
------------- 763,635 Pool #503780, 7.13%, 3/25/22 764,624
FEDERAL HOME LOAN BANK - DISCOUNT NOTES (A) (53.1%) 2,958,627 Pool #503882, 7.00%, 9/25/22 2,955,755
50,000,000 6.70%, 1/24/01 48,713,125 1,486,117 Pool #503892, 7.13%, 7/25/22 1,488,824
80,000,000 6.71%, 1/24/01 77,937,778 4,045,635 Pool #503909, 7.00%, 10/25/22 4,043,513
60,000,000 6.71%, 2/2/01 58,359,900 1,886,259 Pool #504015, 7.00%, 1/25/23 1,885,758
100,000,000 6.62%, 9/6/00 99,910,556 3,472,953 Pool #504062, 7.00%, 2/25/23 3,472,953
50,000,000 6.68%, 9/15/00 49,874,097 3,741,342 Pool #504074, 7.00%, 2/25/23 3,741,342
65,000,000 6.70%, 9/15/00 64,835,821 1,534,946 Pool #504203, 7.13%, 7/25/13 1,539,554
-------------
TOTAL FEDERAL HOME LOAN BANK - DISCOUNT NOTES 399,631,277 1,504,950 Pool #504269, 7.13%, 5/25/15 1,507,997
------------- 1,081,162 Pool #504345, 7.13%, 5/25/18 1,081,162
FEDERAL NATIONAL MORTGAGE ASSOCIATION - DISCOUNT 4,601,877 Pool #504366, 6.88%, 2/25/24 4,597,772
NOTES (A) (9.9%) 11,273,569 Pool #504719, 7.13%, 7/25/24 11,273,569
--------------
75,000,000 6.66%, 10/5/00 74,543,834 Total Small Business Administration 64,322,217
------------- --------------
SMALL BUSINESS ADMINISTRATION (B) (8.5%) STUDENT LOAN MARKETING ASSOCIATION (B) (8.0%)
183,133 Pool #500545, 9.38%, 3/25/03 183,133 30,000,000 6.82%, 7/26/01 30,000,000
403,014 Pool #501077, 8.00%, 11/25/14 403,014 15,000,000 6.82%, 8/14/01 15,000,000
1,834,224 Pool #501308, 8.00%, 10/25/15 1,861,863 15,000,000 6.76%, 2/21/01 15,000,000
--------------
1,472,766 Pool #501543, 7.88%, 7/25/16 1,473,325 Total Student Loan Marketing Association 60,000,000
296,127 Pool #501628, 9.38%, 9/25/04 296,127 --------------
569,899 Pool #501690, 7.63%, 12/25/16 570,571 Total U.S. Government Securities 653,497,328
873,405 Pool #501898, 7.75%, 7/25/17 875,288 --------------
3,209,130 Pool #502150, 7.50%, 2/25/18 3,239,645 REPURCHASE AGREEMENTS (13.2%)
188,143 Pool #502161, 7.50%, 2/25/18 188,143 49,635,000 Bear, Stearns & Co., Inc., 6.70%,
2,014,219 Pool #502208, 7.50%, 2/25/18 2,037,474 9/1/00, to be repurchased at $49,644.238
260,749 Pool #502306, 7.50%, 2/25/18 260,749 collateralized by various
1,000,593 Pool #502613, 7.50%, 4/25/19 1,000,593 U.S. Government Agency Securities. 49,635,000
606,823 Pool #503058, 7.38%, 7/25/15 606,823 50,000,000 Goldman Sachs, 6.50%, 9/1/00,
1,169,628 Pool #503082, 7.38%, 9/25/20 1,169,628 to be repurchased at $50,009,028;
714,183 Pool #503120, 7.38%, 10/25/20 714,183 collateralized by various U.S.
347,846 Pool #503121, 7.38%, 9/25/15 347,846 Government Agency Securities. 50,000,000
--------------
1,171,298 Pool #503232, 7.13%, 2/25/15 1,171,298 Total Repurchase Agreements 99,635,000
523,376 Pool #503278, 7.13%, 2/25/21 523,402 --------------
1,998,086 Pool #503431, 7.25%, 7/25/21 1,999,093 Total Investments (100.0%) at Amortized Cost $753,132,328
==============
</TABLE>
See Notes to Financial Statements
and Notes to Schedules of Investments. 16 FORUM FUNDS[R]
<PAGE>
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS - CASH PORTFOLIO
AUGUST 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C> <C>
FACE SECURITY FACE SECURITY
AMOUNT DESCRIPTION VALUE AMOUNT DESCRIPTION VALUE
--------------- ------------------------------- -------------- -------------- ----------------------------- ----------------
U.S. GOVERNMENT SECURITIES (5.3%) COMMERCIAL PAPER (CONCLUDED)
$90,000,000 Salomon Smith Barney, 6.58%, $ 89,917,750
FEDERAL HOME LOAN BANK (B) (0.9%) 9/6/00
$18,000,000 6.67%, 4/12/01 $18,000,000 25,000,000 Transamerica Financial, 6.52%, 1/8/24,415,918
-------------- 1/8/01
FEDERAL NATIONAL MORTGAGE ASSOCIATION (B) (1.5%) 46,486,000 Transamerica Financial, 6.52%,
30,000,000 6.72%, 5/10/01 30,000,000 1/12/01 45,366,256
-------------- ----------------
Total Commercial Paper 1,123,318,305
----------------
SMALL BUSINESS ADMINISTRATION (B) (1.7%)
149,279 Pool #500536, 8.50%, 5/25/13 149,906 CORPORATE NOTES (B) (11.3%)
255,944 Pool #500730, 9.38%, 2/25/04 255,944 95,000,000 Bank of America Corp., 6.67%,
481,897 Pool #501733, 7.50%, 2/25/17 486,012 4/3/01 95,000,000
670,314 Pool #501989, 7.63%, 10/25/12 671,574 50,000,000 Bear, Stearns & Co., Inc., 6.67%,
91,619 Pool #502914, 7.50%, 3/25/15 91,619 1/5/01 50,000,000
1,391,382 Pool #503121, 7.38%, 8/25/15 1,391,382 25,000,000 Bear, Stearns & Co., Inc., 6.84%,
2,021,034 Pool #503429, 7.25%, 6/25/16 2,021,034 4/6/01 25,000,000
411,922 Pool #503461, 7.25%, 9/25/21 412,111 20,000,000 Bear, Stearns & Co., Inc.,
2,240,874 Pool #503553, 7.13%, 11/25/21 2,235,294 7.03%, 7/26/01 20,000,000
1,732,338 Pool #503754, 7.13%, 5/25/22 1,732,338 10,000,000 Salomon Smith Barney Holdings,
2,827,379 Pool #503882, 7.00%, 9/25/22 2,824,539 6.79%, 4/30/01 10,001,808
3,198,234 Pool #503912, 7.00%, 10/25/22 3,196,485 30,000,000 Unilever Capital Corp, 6.65%,
3,603,538 Pool #504015, 7.00%, 1/25/23 3,602,470 9/7/01 30,000,000
----------------
14,499,330 Pool #504366, 6.88%, 2/26/24 14,486,016 Total Corporate Notes 230,001,808
-------------- ----------------
Total Small Business Administration 33,556,724
--------------
REPURCHASE AGREEMENTS (27.9%)
STUDENT LOAN MARKETING ASSOCIATION (B) (1.2%) 43,910,000 Bear, Stearns & Co., Inc., 6.70%,
25,000,000 6.77%, 2/1/01 25,007,096 9/1/00, to be repurchased at
-------------- $43,918,172; collateralized by
Total U.S. Government Securities 106,563,820 various U.S. Government Agency
-------------- Securities. 43,910,000
COMMERCIAL PAPER (55.5%) 170,000,000 Bear, Stearns & Co., Inc., 6.57%,
50,000,000 Associates First Capital Corp., 9/5/00, to be repurchased at
6.53%, 10/11/00 49,637,222 $170,217,175; collateralized by
75,000,000 AT & T Corp., 6.52%, 1/12/01 73,193,417 various U.S. Government Agency
42,238,000 Avon Capital Corp., 6.59%, 9/13/00 42,145,217 Securities. 170,000,000
90,000,000 Coca Cola Co., 6.55%, 9/1/00 90,000,000 170,000,000 Donaldson Lufkin Jenrette, 6.57%
90,000,000 DaimlerChrysler AG, 6.50%, 11/20/0088,700,000 9/5/00, to be repurchased at
90,000,000 Deutsche Bank Financial, Inc., $170,217,175; collateralized by
6.56%, 10/4/00 89,458,800 various U.S. Government Agency
90,000,000 General Electric Capital, 6.53%, Securities. 170,000,000
1/25/01 87,616,550 31,000,000 Goldman Sachs, 6.50%, 9/1/00, to be
90,000,000 General Motors Acceptance Corp., repurchased at $31,005,597;
6.53%, 1/26/01 87,600,225 collateralized by various U.S.
90,000,000 Goldman Sachs & Co., 6.64%, 11/6/0088,904,400 Government Agency Securities. 31,000,000
90,000,000 International Lease Financial Corp., 150,000,000 Salomon Smith Barney, 6.70%,
6.50%, 1/16/01 87,773,750 9/1/00, to be repurchased at
90,000,000 Merrill Lynch & Co., Inc., $150,027,917; collateralized by
6.52%, 10/10/00 89,364,300 various U.S. Government Agency
90,000,000 Prudential Funding Corp., 6.60%, Securities. 150,000,000
----------------
10/18/00 89,224,500 Total Repurchase Agreements 564,910,000
----------------
Total Investments (100.0%) at Amortized Cost $ 2,024,793,933
================
</TABLE>
See Notes to Financial Statements
and Notes to Schedules of Investments. 17 FORUM FUNDS[R]
<PAGE>
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS - MUNICIPAL CASH PORTFOLIO
AUGUST 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C> <C>
FACE SECURITY FACE SECURITY
AMOUNT DESCRIPTION VALUE AMOUNT DESCRIPTION VALUE
-------------- --------------------------------- -------------- ------------ ------------------------------- ------------
MUNICIPAL SECURITIES (B) (97.7%) MUNICIPAL SECURITIES (CONTINUED)
ALABAMA (6.7%) HAWAII (4.4%)
$ 500,000 Mobile, AL, Industrial Development $ 1,000,000 State of Hawaii, Budget & Finance
Board, Dock & Wharf RV, Holnam, RV, Queens Health Systems, Series A,
Inc. Project, Series B, 4.30%, 6/1/32 $ 500,000 4.40%, 7/1/26 $ 1,000,000
------------
1,000,000 University of AL, Birmingham, INDIANA (4.4%)
Hospital RV, Series B, 4.25%, 10/1/00 71,000,000 1,000,000 Indiana HFA RV, Clarian Health
--------------
1,500,000 Partners, Series B, 4.70%, 2/15/261,000,000
-------------- ------------
ARIZONA (8.9%) KENTUCKY (4.4%)
1,000,000 Arizona Health Facilities Authority 1,000,000 Kentucky EDA, Hospital Facilities
RV, Pooled Loan Programs, FGIC RV, Health Alliance Project, Series C,
insured, 4.25%, 10/1/15 1,000,000 MBIA insured, 4.25%, 1/1/22 1,000,000
------------
1,000,000 Scottsdale AZ, IDA RV, Scottsdale MASSACHUSETTS (2.7%)
Memorial Health System, Series B, 600,000 Massachusetts State, HEFA, Health
AMBAC insured, 4.25%, 9/1/22 1,000,000 RV, Series D, MBIA insured, 4.25%,
-------------- 1/1/35
2,000,000 600,000
-------------- ------------
CALIFORNIA (2.7%) NEVADA (4.0%)
600,000 Irvine Ranch, CA, Water District, Nos. 900,000 Clark County, NV, Airport
105, 140, 240 & 250, GO Bonds, 3.35%, Improvement RV, Series A, MBIA
1/1/21 600,000 insured, 4.25%, 7/1/12 900,000
-------------- ------------
FLORIDA (15.1%) NEW MEXICO (1.8%)
1,000,000 Alachua County, FL, HFA RV, Shands 400,000 University of New Mexico RV,
Teaching Hospital, Series B, 4.25% , AMBAC insured, 4.25%, 6/1/06 400,000
12/1/26 1,000,000 ------------
NEW YORK (4.4%)
500,000 Dade County, FL, Water & Sewer 1,000,000 New York, NY, GO Bonds, Series B,
System RV, FGIC insured, 4.25%, MBIA insured, 4.15%, 8/15/03 1,000,000
10/5/22 500,000 ------------
NORTH CAROLINA (7.1%)
1,000,000 Jacksonville, FL, Electric Authority RV, 600,000 Charlotte, NC, Airport RV, Series A,
Water & Sewer System, Series B, MBIA insured, 4.35%, 7/1/17 600,000
4.30%, 10/1/34 1,000,000
1,000,000 Mecklenburg County, NC, Public
900,000 Tampa, FL, Occupational License Tax Improvement, Series C, Bank of
RV, Series A, FGIC-SPI insured, America LOC, 4.30%, 2/1/17 1,000,000
------------
4.25%, 10/1/18 900,000 1,600,000
-------------- ------------
3,400,000 PENNSYLVANIA (8.9%)
--------------
1,000,000 Pennsylvania State HEHFA, Health
GEORGIA (3.1%) Services RV, University of
700,000 Burke County, GA, PCR, Oglethorpe Pennsylvania, Series B, 4.35%,
Power Corp., Series A, 4.25%, 1/1/16 700,000 1/1/24 1,000,000
--------------
</TABLE>
See Notes to Financial Statements
and Notes to Schedules of Investments. 18 FORUM FUNDS[R
<PAGE>
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS - MUNICIPAL CASH PORTFOLIO (Concluded)
AUGUST 31, 2000
--------------------------------------------------------------------------------
FACE SECURITY
AMOUNT DESCRIPTION VALUE
-------------- --------------------------------- --------------
MUNICIPAL SECURITIES (CONCLUDED)
$ 1,000,000 York County, PA, IDA, PCR Bonds,
Public Service Electric & Gas, Series
A, MBIA insured, 4.20% , 9/1/20 $ 1,000,000
--------------
2,000,000
--------------
SOUTH CAROLINA (3.5%)
800,000 South Carolina State, Jobs EDA
Hospital Facilities RV, Regional
Medical Center Orangeburg, AMBAC
insured, 4.25%, 2/15/28 800,000
--------------
TEXAS (6.7%)
500,000 South Texas, TX, HEFA RV, MBIA
insured, 4.35% , 12/1/27 500,000
1,000,000 Texas State, GO Bonds, Veterans
Housing Assistance Fund I, 4.25%,
12/1/16 1,000,000
--------------
1,500,000
--------------
WASHINGTON (8.9%)
1,000,000 Washington State, GO Bonds, Series
VR 96B, 4.25%, 6/1/20 1,000,000
1,000,000 Washington State Public Power Supply
System, Project No. 2, Electric RV
Series 2A-1, MBIA insured, 4.25%,
7/1/12 1,000,000
--------------
2,000,000
--------------
Total Municipal Securities 22,000,000
--------------
CASH MANAGEMENT ACCOUNTS (2.3%)
310,000 Federated Investors Tax-Free
Obligations Fund, 4.08% yield 310,000
207,000 Federated Municipal Obligations Fund,
4.29% yield 207,000
--------------
--------------
Total Cash Management Accounts 517,000
--------------
Total Investments (100.0%) at Amortized Cost $22,517,000
==============
See Notes to Financial Statements
and Notes to Schedules of Investments. 19 FORUM FUNDS[R
<PAGE>
--------------------------------------------------------------------------------
NOTES TO SCHEDULES OF INVESTMENTS
--------------------------------------------------------------------------------
AMBAC American Municipal Bond Assurance Corporation
EDA Economic Development Authority
FGIC Financial Guaranty Insurance Company
FGIC-SPI Financial Guaranty Insurance Company-Securities Purchase, Inc.
GO General Obligation
HEFA Higher Education Facilities Authority
HEHFA Higher Education & Health Facilities Authority
HFA Health Facilities Authority
IDA Industrial Development Authority
LOC Letter of Credit
MBIA Municipal Bond Insurance Association
PCR Pollution Control Revenue
RV Revenue Bonds
(A) Annualized yields at time of purchase.
(B) Certain securities are deemed to have a maturity remaining until the next
adjustment of the interest rate or the longer of the demand period or
readjustment. The interest rates shown reflect the rate in effect on August
31, 2000.
See Notes to Financial Statements. 20 FORUM FUNDS(R)
<PAGE>
--------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES - PORTFOLIOS
AUGUST 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C> <C>
TREASURY GOVERNMENT MUNICIPAL
CASH GOVERNMENT CASH CASH CASH
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
-------------- -------------- -------------- ---------------- --------------
ASSETS
Investments (Note 2):
Securities at amortized cost $ 373,677,083 $ 43,479,384 $ 653,497,328 $ 1,459,883,933 $ 22,517,000
Repurchase agreements at cost 93,800,000 - 99,635,000 564,910,000 -
-------------- -------------- -------------- ---------------- --------------
Total investments, at amortized cost 467,477,083 43,479,384 753,132,328 2,024,793,933 22,517,000
Cash 10,445 - 19,425 25,849 352
Interest and other receivables 17,067 88,573 3,570,615 4,263,379 123,489
-------------- -------------- -------------- ---------------- --------------
Total assets 467,504,595 43,567,957 756,722,368 2,029,083,161 22,640,841
-------------- -------------- -------------- ---------------- --------------
LIABILITIES
Payable to Adviser (Note 3) 12,950 - 22,908 55,855 -
Payable to Administrator (Note 3) 19,790 - 35,007 85,355 -
Accrued expenses and other liabilities 24,674 3,196 36,413 61,008 -
-------------- -------------- -------------- ---------------- --------------
Total liabilities 57,414 3,196 94,328 202,218 -
-------------- -------------- -------------- ---------------- --------------
NET ASSETS $ 467,447,181 $ 43,564,761 $ 756,628,040 $ 2,028,880,943 $ 22,640,841
============== ============== ============== ================ ==============
</TABLE>
See Notes to Financial Statements. 21 FORUM FUNDS[R]
<PAGE>
--------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS - PORTFOLIOS
FOR THE YEAR ENDED AUGUST 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C> <C>
TREASURY GOVERNMENT MUNICIPAL
CASH GOVERNMENT CASH CASH CASH
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
-------------- ---------------- ----------------- -------------- --------------
INVESTMENT INCOME
Interest income $24,783,322 $ 1,994,976 $ 52,030,135 $ 105,366,476 $ 831,242
-------------- ---------------- ----------------- -------------- --------------
EXPENSES
Investment advisory (Note 3) 140,443 16,754 288,058 565,516 10,882
Administration (Note 3) 212,726 16,754 436,043 857,926 10,882
Custody 94,568 7,466 194,285 380,481 5,280
Accounting (Note 3) 49,500 49,500 49,500 49,500 61,500
Legal 3,628 282 8,154 13,326 180
Audit 13,347 9,967 17,250 24,324 9,862
Trustees 3,463 288 7,650 14,074 192
Amortization of organization costs (Note 2) 239 - 4,390 1,187 -
Miscellaneous 36,411 1,651 16,419 29,815 3,749
-------------- ---------------- ----------------- -------------- --------------
Total expenses 554,325 102,662 1,021,749 1,936,149 102,527
Expenses reimbursed and fees waived
(Note 4) - (52,259) - - (102,527)
-------------- ---------------- ----------------- -------------- --------------
Net expenses 554,325 50,403 1,021,749 1,936,149 -
-------------- ---------------- ----------------- -------------- --------------
NET INVESTMENT INCOME 24,228,997 1,944,573 51,008,386 103,430,327 831,242
NET REALIZED GAIN (LOSS) ON
INVESTMENTS SOLD 194 (21) 3,028 (5,850) -
-------------- ---------------- ----------------- -------------- --------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $24,229,191 $ 1,944,552 $ 51,011,414 $ 103,424,477 $ 831,242
============== ================ ================= ============== ==============
</TABLE>
See Notes to Financial Statements. 22 FORUM FUNDS[R]
<PAGE>
--------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS - PORTFOLIOS
FOR THE YEARS ENDED AUGUST 31, 1999 AND AUGUST 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C> <C>
TREASURY GOVERNMENT MUNICIPAL
CASH GOVERNMENT CASH CASH CASH
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------------- ---------------- ----------------- ---------------- --------------
NET ASSETS - August 31, 1998 $ 264,844,947 $ 46,762,986 $ 717,124,357 $ 607,340,844 $ 20,834,474
--------------- ---------------- ----------------- ---------------- --------------
OPERATIONS
Net investment income 14,338,620 1,959,744 43,247,634 38,566,190 890,884
Net realized gain (loss) on investments sold (11,696) (5,051) 24,483 (663) (3,395)
--------------- ---------------- ----------------- ---------------- --------------
Net increase in net assets from operations 14,326,924 1,954,693 43,272,117 38,565,527 887,489
--------------- ---------------- ----------------- ---------------- --------------
TRANSACTIONS IN INVESTORS'
BENEFICIAL INTERESTS
Contributions 1,235,422,406 35,329,739 2,886,646,104 2,464,999,269 36,409,301
Withdrawals (1,121,452,949) (48,706,809) (2,863,580,162) (2,074,003,392) (34,072,975)
--------------- ---------------- ----------------- ---------------- --------------
Net transactions in investors' beneficial
interests 113,969,457 (13,377,070) 23,065,942 390,995,877 2,336,326
--------------- ---------------- ----------------- ---------------- --------------
Net increase (decrease) in net assets 128,296,381 (11,422,377) 66,338,059 429,561,404 3,223,815
--------------- ---------------- ----------------- ---------------- --------------
NET ASSETS - August 31, 1999 393,141,328 35,340,609 783,462,416 1,036,902,248 24,058,289
--------------- ---------------- ----------------- ---------------- --------------
OPERATIONS
Net investment income 24,228,997 1,944,573 51,008,386 103,430,327 831,242
Net realized gain (loss) on investments sold 194 (21) 3,028 (5,850) -
--------------- ---------------- ----------------- ---------------- --------------
Net increase in net assets from operations 24,229,191 1,944,552 51,011,414 103,424,477 831,242
--------------- ---------------- ----------------- ---------------- --------------
TRANSACTIONS IN INVESTORS'
BENEFICIAL INTERESTS
Contributions 2,068,127,015 44,650,669 3,688,015,715 3,662,395,443 15,898,214
Withdrawals (2,018,050,353) (38,371,069) (3,765,861,505) (2,773,841,225) (18,146,904)
--------------- ---------------- ----------------- ---------------- --------------
Net transactions in investors' beneficial
interests 50,076,662 6,279,600 (77,845,790) 888,554,218 (2,248,690)
--------------- ---------------- ----------------- ---------------- --------------
Net increase (decrease) in net assets 74,305,853 8,224,152 (26,834,376) 991,978,695 (1,417,448)
--------------- ---------------- ----------------- ---------------- --------------
NET ASSETS - August 31, 2000 $ 467,447,181 $ 43,564,761 $ 756,628,040 $ 2,028,880,943 $22,640,841
=============== ================ ================= ================ ==============
</TABLE>
See Notes to Financial Statements. 23 FORUM FUNDS[R]
<PAGE>
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS - PORTFOLIOS
AUGUST 31, 2000
--------------------------------------------------------------------------------
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, as amended (the
"Act"), currently has five diversified investment portfolios, Treasury Cash
Portfolio, Government Portfolio, Government Cash Portfolio, Cash Portfolio and
Municipal Cash Portfolio (individually, a "Portfolio" and, collectively, the
"Portfolios"). Government Portfolio commenced operations on February 21, 1996,
Municipal Cash Portfolio commenced operations on June 25, 1998, and the other
Portfolios commenced operations on September 1, 1995. 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
These financial statements are prepared in accordance with accounting principles
generally accepted in the United States of America which require management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities, 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. The following represent significant accounting policies of
the Portfolios:
SECURITY VALUATION - Each Portfolio determines its net asset value per share as
of 4:00 p.m., Eastern time, on each Portfolio business day, utilizing the
amortized cost method pursuant to Rule 2a-7 under the Act. 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 - Treasury Cash Portfolio, Government Cash Portfolio and
Cash Portfolio may invest in repurchase agreements. Each of these Portfolios,
through its custodian, receives delivery of the underlying collateral, whose
market value always exceeds or equals the repurchase price plus expected
transaction costs. In the case of a tri-party agreement, the collateral is held
by an agent bank. The investment adviser is responsible for determining the
value of the underlying collateral. In the event of default, a Portfolio may
have difficulties with the disposition of any such securities held as
collateral.
ORGANIZATION 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.
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 the Portfolios are deemed to have been "passed-through" to the
interestholders in proportion to their holdings in the Portfolios regardless of
whether such interest, dividends or gain have been distributed by the
Portfolios.
SECURITIES TRANSACTIONS, INTEREST INCOME AND REALIZED GAIN AND LOSS - Securities
transactions are recorded on the trade date. Interest income is accrued as
earned and realized gain and loss on investments sold are recorded on the basis
of identified cost.
24 FORUM FUNDS[R]
<PAGE>
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS - PORTFOLIOS (Continued)
AUGUST 31, 2000
--------------------------------------------------------------------------------
NOTE 3. INVESTMENT ADVISORY AND OTHER SERVICES
INVESTMENT ADVISER - The investment adviser of each Portfolio is Forum
Investment Advisors, LLC ("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. Forum Advisors receives an advisory fee from Government
Portfolio and Municipal Cash Portfolio at an annual rate of 0.05% of the average
daily net assets of each Portfolio.
ADMINISTRATOR - The administrator of each Portfolio is Forum Administrative
Services, LLC ("FAdS"). For its administrative services and facilities, FAdS
receives from each Portfolio an administration fee at an annual rate of 0.05% of
the average daily net assets of each Portfolio. In addition, certain legal
expenses are charged to the Portfolios by FAdS.
PLACEMENT AGENT - Forum Fund Services, Inc. ("FFS"), a registered broker-dealer
and a member of the National Association of Securities Dealers, Inc., acts as
each Portfolio's placement agent but receives no fee for this service.
OTHER SERVICE PROVIDER - Forum Accounting Services, LLC ("FAcS") serves as the
Portfolios' fund accountant and interestholder recordkeeper. For these services,
FAcS receives a fee from Treasury Cash, Government Cash and Cash Portfolios
based on the lesser of $4,000 per month or 0.05% of the Portfolio's average
annual daily net assets, plus additional charges. Government Portfolio and
Municipal Cash Portfolio each pay a fee of $48,000 per year, plus certain
additional charges.
NOTE 4. WAIVER OF FEES AND EXPENSE REIMBURSEMENT
For the year ended August 31, 2000, FAdS and FAcS voluntarily waived a portion
of their fees for certain Portfolios as follows: Government Portfolio investment
advisory fees of $16,754, administration fees of $16,754, and accounting fees of
$16,000; Municipal Cash Portfolio advisory fees of $10,882, administration fees
of $10,882, and accounting fees of $61,500. FAdS also reimbursed certain
expenses of Government Portfolio and Municipal Cash Portfolio in the amounts of
$2,751 and $19,263, respectively.
25 FORUM FUNDS[R]
<PAGE>
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NOTES TO FINANCIAL STATEMENTS - PORTFOLIOS (Concluded)
AUGUST 31, 2000
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NOTE 5. INCOME AND EXPENSE RATIOS
The ratio of net investment income and expenses to average net assets are listed
below. The ratio of Gross Expenses to Average Net Assets reflects the expense
ratio excluding applicable fee waivers and reimbursements.
<TABLE>
<S> <C> <C> <C>
Ratios to Average Net Assets
Net
Investment Net Gross
Income Expenses Expenses
Treasury Cash Portfolio
Year Ended August 31, 2000............................................... 5.69% 0.13% 0.13%
Year Ended August 31, 1999............................................... 4.69% 0.14% 0.14%
Year Ended August 31, 1998............................................... 5.34% 0.15% 0.17%
Year Ended August 31, 1997............................................... 5.20% 0.15% 0.18%
Year Ended August 31, 1996............................................... 5.30% 0.15% 0.20%
Government Portfolio
Year Ended August 31, 2000............................................... 5.80% 0.15% 0.31%
Year Ended August 31, 1999............................................... 4.85% 0.15% 0.30%
Year Ended August 31, 1998............................................... 5.26% 0.15% 0.29%
Period Ended August 31, 1997 (a) (b)..................................... 5.11% 0.15% 0.36%
Year Ended March 31, 1997................................................ 5.04% 0.15% 0.33%
Period Ended March 31, 1996 (a).......................................... 4.99% 0.15% 0.60%
Government Cash Portfolio
Year Ended August 31, 2000............................................... 5.85% 0.12% 0.12%
Year Ended August 31, 1999............................................... 4.94% 0.12% 0.12%
Year Ended August 31, 1998............................................... 5.52% 0.13% 0.13%
Year Ended August 31, 1997............................................... 5.38% 0.14% 0.14%
Year Ended August 31, 1996............................................... 5.49% 0.14% 0.14%
Cash Portfolio
Year Ended August 31, 2000............................................... 6.03% 0.11% 0.11%
Year Ended August 31, 1999............................................... 5.00% 0.12% 0.12%
Year Ended August 31, 1998............................................... 5.55% 0.13% 0.13%
Year Ended August 31, 1997............................................... 5.45% 0.15% 0.15%
Year Ended August 31, 1996............................................... 5.50% 0.15% 0.16%
Municipal Cash Portfolio
Year Ended August 31, 2000............................................... 3.82% 0.00% 0.47%
Year Ended August 31, 1999............................................... 3.11% 0.03% 0.35%
Period Ended August 31, 1998 (a)......................................... 3.18% 0.09% 0.61%
</TABLE>
(a) Annualized.
(b) Effective June 19, 1997, Government Portfolio changed its fiscal year
end from March 31 to August 31.
<PAGE>
<TABLE>
<S> <C>
FOR MORE INFORMATION
FORUM
FUNDS
DAILY ASSETS TREASURY
OBLIGATIONS FUND
DAILY ASSETS
GOVERNMENT FUND
DAILY ASSETS GOVERNMENT
OBLIGATIONS FUND
DAILY ASSETS CASH FUND
DAILY ASSETS
MUNICIPAL FUND
TRANSFER AGENT
Forum Shareholder Services, LLC
Two Portland Square
Portland, Maine 04101
[OBJECT OMITTED]
DISTRIBUTOR
FORUM FUNDS
Forum Fund Services, LLC P.O. Box 446
Two Portland Square Portland, Maine 04112
Portland, ME 04101 800-94FORUM
800-943-6786
This report is authroized for distribution only to shareholders and to 207-879-0001
others who have received a copy of the Funds' prospectus. www.forumfunds.com
</TABLE>
