[Banner of BIA Logo]
BIA SMALL-CAP GROWTH FUND
BIA GROWTH EQUITY FUND
SEMI-ANNUAL REPORT
NOVEMBER 30, 1999
<PAGE>
- --------------------------------------------------------------------------------
BIA SMALL-CAP GROWTH FUND
SEMI-ANNUAL REPORT
NOVEMBER 30, 1999
- --------------------------------------------------------------------------------
Dear Fellow Shareholder:
November 30, 1999 was the midway point of the BIA Small-Cap Growth
Fund's first fiscal year. We are pleased to provide the results of the Fund's
initial reporting period. Since inception on June 28, 1999, the Fund's net asset
value rose 23%, which compares favorably with the relevant indices against which
we measure performance:
Total return for 6/28/99 - 11/30/99 1
BIA Small-Cap Growth Fund 23.00%
Russell 2000(R)Growth Index 11.08%
Russell 2000(R)Index 1.75%
S&P 500 Index 4.88%
These performance results reflect the underlying earnings growth of the
companies that are held in the Fund, as well as the significant strength in
technology and health care investments for the reporting period. They also
reflect, to some extent, the inherent volatility of the small capitalization
sector in general.
History has shown that carefully selected emerging growth companies
have produced outstanding returns for investors who resolutely hold their shares
while these companies have compounded their sales and earnings at high rates.
Simply stated, this is the foundation of our investment philosophy.
A consistent, long-term strategy built on this philosophy has been
implemented by our highly experienced portfolio management and research team.
The strategy is to identify smaller companies with high growth in earnings per
share (20%+ annually) which address very large market opportunities with
products or services that are sufficiently unique or superior to sustain the
growth for many years. We seek a focused company management team with an
articulated plan that we can monitor. These factors are combined to develop an
investment thesis against which we can monitor the progress of each company in
the portfolio. Our objective is to hold each company as long as its investment
thesis remains intact.
Our portfolio companies in the aggregate, have achieved earnings growth
greater than 35% per year, and we currently anticipate growth at that rate to
continue over the next three years. An additional benefit of this long-term
strategy is low portfolio turnover, which since inception has been 24%. This low
turnover creates a high level of tax efficiency for taxable investors. 2
Along with Charlie Reid, Steve Rockwell, and Nick Coutros, I would like
to welcome you to the BIA Small-Cap Growth Fund and look forward to a long and
prosperous relationship for many years to come.
Frederick L. Meserve, Jr.
Portfolio Manager
- -----------------------
1 PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RETURNS.
2 PORTFOLIO TURNOVER MAY NOT BE LIMITED DURING PERIODS OF SIGNIFICANT
REDEMPTIONS OR WHEN, BASED UPON INVESTMENT CONSIDERATIONS, THE FUND'S
MANAGER DEEMS IT APPROPRIATE TO MAKE CHANGES IN THE PORTFOLIO SECURITIES.
THE RUSSELL 2000(R) GROWTH INDEX MEASURES THE PERFORMANCE OF THOSE RUSSELL 2000
COMPANIES WITH HIGHER PRICE-TO-BOOK RATIOS AND HIGHER FORECASTED GROWTH VALUES.
THE RUSSELL 2000(R) INDEX IS AN UNMANAGED, MARKET VALUE WEIGHTED INDEX WHICH IS
WIDELY REGARDED TO BE REPRESENTATIVE OF SMALL-COMPANY STOCKS IN GENERAL. THE S&P
500 INDEX IS AN UNMANAGED INDEX REPRESENTING THE AVERAGE PERFORMANCE OF 500
WIDELY HELD, PUBLICLY TRADED LARGE CAPITALIZATION STOCKS. YOU CANNOT INVEST
DIRECTLY IN ANY INDEX.
THE VIEWS IN THIS REPORT WERE THOSE OF THE FUND'S MANAGER AS OF NOVEMBER 30,
1999, AND MAY NOT REFLECT THE VIEWS OF THE MANAGER ON THE DATE THIS REPORT IS
FIRST PUBLISHED OR ANY TIME THEREAFTER. THESE VIEWS ARE INTENDED TO ASSIST
SHAREHOLDERS OF THE FUND IN UNDERSTANDING THEIR INVESTMENT IN THE FUND AND DO
NOT CONSTITUTE INVESTMENT ADVICE.
1 FORUM FUNDS[R]
<PAGE>
- --------------------------------------------------------------------------------
BIA GROWTH EQUITY FUND
SEMI-ANNUAL REPORT
NOVEMBER 30, 1999
- --------------------------------------------------------------------------------
Dear Fellow Shareholder:
We are pleased to report the results of the BIA Growth Equity Fund for
the period ending November 30, 1999. Since the Fund's inception on June 28,
1999, the net asset value has increased by 3.47%, as compared to the 4.88%
increase in the S&P 500 Index. Although our goal is to outperform the benchmark
over the long-term, in today's very narrow market environment, over 60% of the
S&P 500's stocks are actually down year-to-date. Nevertheless, we are generally
pleased with the Fund's early returns.
Technology fever continues as the rise of Internet computing in 1999
reshapes every industry it touches. In the current market environment investors
are rewarding companies somewhat indiscriminately if they appear to be even
tangentially related to the Web and punishing those companies believed to be
challenged by or replaced by the potential of the Internet.
The Fund has benefited from the surge in technology stocks, and this
sector now accounts for close to 30% of the Fund. Our challenge for 2000 will be
to sort out where the large, long-term opportunities are and be ready to act
when the inevitable shakeout in the technology sector occurs. We believe
companies such as Oracle, Texas Instruments, Cisco and WorldCom will be major
players in the continuing evolution of the digital world. At the same time, the
underperformance of many stocks outside of the technology sector has created
interesting opportunities to invest in undervalued growth companies in financial
services, manufacturing and health care.
As we near the end of 1999, the economy is showing signs of
acceleration despite three interest rate hikes by the Federal Reserve in the
last six months. Theoretically, the US should be experiencing a slowdown in
interest rate sensitive sectors such as housing and consumer spending. In fact,
most retailers (with some notable exceptions among the traditional department
stores) are doing well and housing prices have continued to rise in response to
strong demand. Consumer confidence is in a recovery mode after having been down
most of the second half of the year. And why shouldn't the consumer be feeling
flush? The stock market is up, thanks to the technology sector, employment rates
are high and a global economic recovery appears to be taking shape. There is
some risk that the Fed is "behind the curve" and may have waited too long to
act. The Fed could jawbone or signal a tightening in early January to avoid
letting the economy or the stock market overheat. Such action could take the
equity markets by surprise, although the bond market might be reflecting such a
scenario already, given the poor performance of bonds this fall and winter.
Earlier this year the markets were very nervous about how Y2K might
impact the near-term fundamentals of key industries such as technology,
financial services and health care. We have seen only limited evidence of
unusual business activity linked to Y2K concerns; the market has shared this
observation and the "relief rally" in technology has been huge. Obviously, the
Y2K event has not been fully played out and still represents an unknown going
into the new year. Our view remains that there may be some inventory-related
effect early in the year, but we are optimistic that technology spending trends
will remain positive.
Over the course of the year we reduced our exposure to the health care
sector because of our growing concern about prospects for the drug stocks. We
believe that the pharmaceutical sector will have a challenging year in 2000
because upcoming patent expirations, a lack of blockbuster drugs close to launch
and negative political rhetoric aimed at the group will keep a cap on
valuations.
2 FORUM FUNDS[R]
<PAGE>
- --------------------------------------------------------------------------------
BIA GROWTH EQUITY FUND
SEMI-ANNUAL REPORT (continued)
NOVEMBER 30, 1999
- --------------------------------------------------------------------------------
We anticipate that the Fed will be vigilant and continue on its path of
raising rates which should have the impact of slowing the economy. If that
scenario plays out, investors will seek companies with strong relative growth,
which should bode well for the holdings in the Fund.
Geoffrey R. B. Carey, CFA Jane W. Korhonen, CFA
Portfolio Manager Portfolio Manager
- -----------------------
1PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RETURNS.
THE S&P 500 INDEX IS AN UNMANAGED INDEX REPRESENTING THE AVERAGE PERFORMANCE
OF 500 WIDELY HELD, PUBLICLY TRADED, LARGE CAPITALIZATION STOCKS. YOU CANNOT
INVEST DIRECTLY IN ANY INDEX.
THE VIEWS IN THIS REPORT WERE THOSE OF THE FUND'S MANAGERS AS OF NOVEMBER 30,
1999, AND MAY NOT REFLECT THE VIEWS OF THE MANAGERS ON THE DATE THIS REPORT
IS FIRST PUBLISHED OR ANY TIME THEREAFTER. THESE VIEWS ARE INTENDED TO ASSIST
SHAREHOLDERS OF THE FUND IN UNDERSTANDING THEIR INVESTMENT IN THE FUND AND DO
NOT CONSTITUTE INVESTMENT ADVICE.
3 FORUM FUNDS[R]
<PAGE>
- --------------------------------------------------------------------------------
BIA SMALL-CAP GROWTH FUND
SCHEDULE OF INVESTMENTS (unaudited)
NOVEMBER 30, 1999
- --------------------------------------------------------------------------------
COMMON STOCK (87.1%)
Shares Security Description Value
---------- ------------------------------- --------------
BUSINESS SERVICES (43.8%)
60,700 Aspect Development, Inc. * $ 2,898,425
46,400 Broadvision, Inc. * 4,318,100
35,450 Documentum, Inc. * 1,192,006
91,702 Eclipsys Corp. * 2,235,236
60,600 Getty Images, Inc. * 2,393,700
116,600 Integrated Systems, Inc. * 3,344,963
56,452 MemberWorks, Inc. * 1,411,300
5,375 Novadigm, Inc. * 93,391
68,486 QRS Corp. * 3,980,749
85,100 RSA Security, Inc. * 3,169,975
45,257 Synopsys, Inc. 3,275,475
--------------
28,313,320
--------------
CHEMICALS & ALLIED PRODUCTS (2.8%)
32,367 Abbott Laboratories 1,229,952
17,400 Collagenex Pharmaceuticals, Inc. * 382,800
12,700 Guilford Pharmaceuticals, Inc. * 185,737
--------------
1,798,489
--------------
COMMUNICATIONS (1.2%)
900 Cumulus Media, Inc. * 36,000
41,070 Pacific Gateway Exchange, Inc. * 749,527
--------------
785,527
--------------
EATING & DRINKING PLACES (6.0%)
118,988 Avado Brands, Inc. * 572,630
108,475 O'Charleys, Inc. * 1,423,734
53,275 Papa John's International, Inc. * 1,912,908
--------------
3,909,272
--------------
EDUCATIONAL SERVICES (5.4%)
83,500 Apollo Group, Inc. * 2,244,063
93,965 Sylvan Learning Systems, Inc. * 1,239,163
--------------
3,483,226
--------------
ELECTRONIC & OTHER ELECTRICAL EQUIPMENT & COMPONENTS,
EXCEPT COMPUTER EQUIPMENT (7.0%)
72,550 Advanced Lighting Technologies, Inc. * 399,025
40,050 AstroPower, Inc. * 500,625
55,000 ATMI, Inc. * 1,674,063
94,950 SIPEX Corp. * 1,317,431
35,600 Tekelec * 631,900
--------------
4,523,044
--------------
ENGINEERING, ACCOUNTING, RESEARCH, MANAGEMENT &
RELATED SERVICES (3.9%)
51,059 AHL Serices, Inc. * 938,209
17,150 Incyte Pharmaceuticals, Inc. * 497,350
232,550 US Oncology, Inc. * 1,097,357
--------------
2,532,916
--------------
FOOD STORES (1.8%)
44,100 Starbucks Corp. * 1,171,406
--------------
HEALTH SERVICES (2.3%)
111,500 Sunrise Assisted Living, Inc. * 1,463,437
--------------
MEASURING, ANALYZING, & CONTROLLING INSTRUMENTS;
PHOTOGRAPHIC, MEDICAL & OPTICAL GOODS (3.7%)
39,660 ArthroCare Corp. * $ 2,399,430
9,350 Bionx Implants, Inc. * 24,544
--------------
2,423,974
--------------
MISCELLANEOUS RETAIL (1.5%)
73,050 Wilmar Industries, Inc. * 986,175
--------------
MOTOR FREIGHT TRANSPORTATION & WAREHOUSING (2.6%)
50,150 Forward Air Corp. * 1,560,919
25,075 Landair Corp. * 125,375
--------------
1,686,294
--------------
RUBBER & MISCELLANEOUS PLASTICS PRODUCTS (0.6%)
14,750 Trex Co., Inc. * 379,813
--------------
SOCIAL SERVICES (0.6%)
24,825 Bright Horizons Family Solutions, Inc. 383,236
--------------
TRANSPORTATION BY AIR (1.3%)
40,500 Atlantic Coast Airlines Holdings * 840,375
--------------
TRANSPORTATION SERVICES (0.4%)
22,400 Railworks Corp. * 224,000
--------------
WHOLESALE TRADE - DURABLE GOODS (2.2%)
140,720 PSS World Medical, Inc. * 1,411,605
--------------
Total Common Stock (Cost $41,887,096) 56,316,109
--------------
SHORT-TERM INVESTMENTS (12.9%)
Principal Amount Security Description Value
----------------- --------------------------- --------------
FEDERAL HOME LOAN MORTGAGE CORP. -
DISCOUNT NOTES (3.9%)
$ 1,250,000 5.43%, 12/9/99 $ 1,248,517
1,250,000 5.50%, 12/14/99 1,247,558
--------------
2,496,075
--------------
CASH MANAGEMENT ACCOUNTS (9.0%)
3,305,325 BT Investment Money Market Fund 3,305,325
2,533,902 BT Institutional Cash Management
Fund 2,533,902
--------------
5,839,227
--------------
Total Short-Term Investments
(Cost $8,335,302) 8,335,302
--------------
TOTAL INVESTMENTS (100.0%) (Cost $50,222,398) $ 64,651,411
==============
-------------------------------------------------------------
* Non-income producing security.
4 FORUM FUNDS[R]
<PAGE>
- --------------------------------------------------------------------------------
BIA GROWTH EQUITY FUND
SCHEDULE OF INVESTMENTS (unaudited)
NOVEMBER 30, 1999
- --------------------------------------------------------------------------------
COMMON STOCK (95.1%)
Shares Security Description Value
--------- ------------------------------- ---------------
AMUSEMENT & RECREATION SERVICES (1.5%)
11,850 Walt Disney Co. $ 330,319
---------------
APPAREL & ACCESSORY STORES (4.7%)
13,020 CVS Corp. 516,731
11,975 Gap, Inc. 484,988
---------------
1,001,719
---------------
BUILDING MATERIALS (2.6%)
11,350 Lowe's Cos., Inc. 565,372
---------------
BUSINESS SERVICES (9.3%)
8,500 Computer Associates International, Inc. 552,500
7,100 Microsoft Corp. * 646,433
5,420 Oracle Corp. * 367,544
19,575 Parametric Technology Co. * 444,108
---------------
2,010,585
---------------
CHEMICALS & ALLIED PRODUCTS (11.5%)
8,070 Abbott Laboratories 306,660
5,925 Bristol-Myers Squibb Co. 432,895
9,450 Colgate-Palmolive Co. 518,569
7,425 E.I. du Pont de Nemours & Co. 441,323
8,900 Praxair, Inc. 397,163
4,290 Warner-Lambert Co. 384,759
---------------
2,481,369
---------------
COMMUNICATIONS (7.5%)
4,275 GTE Corp. 312,075
9,275 MCI Worldcom, Inc. * 766,926
10,150 SBC Communications, Inc. 527,166
---------------
1,606,167
---------------
DEPOSITORY INSTITUTIONS (7.9%)
7,900 Chase Manhattan Corp. 610,275
11,540 Citigroup, Inc. 621,718
10,225 Wells Fargo Co. 475,463
---------------
1,707,456
---------------
ELECTRIC, GAS & SANITARY SERVICES (1.4%)
9,015 CMS Energy Corp. 299,748
---------------
ELECTRONIC & OTHER ELECTRICAL EQUIPMENT & COMPONENTS,
EXCEPT COMPUTER EQUIPMENT (9.1%)
6,500 Intel Corp. 498,469
7,075 Linear Technology Corp. 502,767
7,550 Lucent Technologies, Inc. 551,622
4,270 Texas Instruments, Inc. 410,187
---------------
1,963,045
---------------
FABRICATED METAL PRODUCTS, EXCEPT MACHINERY &
TRANSPORTATION EQUIPMENT (0.9%)
7,725 Maso Corp. 195,056
---------------
FOOD & KINDRED PRODUCTS (1.7%)
10,675 PepsiCo, Inc. 368,955
---------------
GENERAL MERCHANDISE STORES (2.4%)
7,246 Dayton Hudson Corp. 511,296
---------------
HEAVY CONSTRUCTION OTHER THAN BUILDING CONSTRUCTION-
CONTRACTORS (2.3%)
13,000 Halliburton Co. $ 502,938
---------------
INDUSTRIAL & COMMERCIAL MACHINERY &
COMPUTER EQUIPMENT (11.4%)
8,225 Cisco Systems, Inc. * 733,567
6,745 Compaq Computer Corp. 164,831
7,220 Deere & Co. 310,009
9,600 Dover Corp. 416,400
3,725 Hewlett-Packard Co. 353,409
10,100 Ingersoll-Rand Co. 489,219
---------------
2,467,435
---------------
INSURANCE (2.9%)
5,956 American International Group, Inc. 614,957
---------------
MEASURING, ANALYZING, & CONTROLLING INSTRUMENTS;
PHOTOGRAPHIC, MEDICAL & OPTICAL GOODS (2.3%)
12,600 Medtronic, Inc. 489,825
---------------
MISCELLANEOUS MANUFACTURING INDUSTRIES (2.9%)
15,475 Tyco International Ltd. 619,967
---------------
NONDEPOSITORY CREDIT INSTITUTIONS (4.3%)
9,950 Freddie Mac 491,281
17,625 MBNA Corp. 445,031
---------------
936,312
---------------
PETROLEUM REFINING & RELATED INDUSTRIES (2.4%)
5,050 Mobil Corp. 526,778
---------------
PHARMACEUTICAL PREPARATIONS (1.3%)
5,381 American Home Products Corp. 279,812
---------------
WATER TRANSPORTATION (2.0%)
10,000 Carnival Corp. 441,250
---------------
WHOLESALE TRADE - NONDURABLE GOODS (2.8%)
11,370 Cardinal Health, Inc. 594,793
---------------
Total Common Stock (Cost $16,437,849) 20,515,154
---------------
SHORT TERM INVESTMENTS (4.9%)
Principal Amount Security Description Value
----------------- --------------------------- ---------------
$ 1,051,059 BT Investment Money Market Fund
(Cost $1,051,059) $ 1,051,059
---------------
TOTAL INVESTMENTS (100.0%) (COST $17,488,908) $21,566,213
===============
------------------------------------------------------------
* Non-income producing security.
5 FORUM FUNDS[R]
<PAGE>
<TABLE>
<S> <C> <C>
- ------------------------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES (unaudited)
NOVEMBER 30, 1999
- ------------------------------------------------------------------------------------------------
BIA BIA
SMALL-CAP GROWTH
GROWTH EQUITY
FUND FUND
-------------------- --------------------
ASSETS
Investments (Note 2)
Investments, at cost $ 50,222,398 $ 17,488,908
Net unrealized appreciation 14,429,013 4,077,305
-------------------- --------------------
Total investments, at value 64,651,411 21,566,213
Receivable for securities sold 31,028 -
Interest, dividends and other receivables 16,604 24,951
Receivable for Fund shares sold 129,150 139,220
-------------------- --------------------
Total Assets 64,828,193 21,730,384
-------------------- --------------------
LIABILITIES
Payable for securities purchased (Note 3) 56,201 595,515
Payable to adviser (Note 3) 44,709 2,148
Payable to administrator (Note 3) 5,118 3,333
Accrued expenses and other liabilities 15,462 10,151
-------------------- --------------------
Total Liabilities 121,490 611,147
-------------------- --------------------
NET ASSETS $ 64,706,703 $ 21,119,237
==================== ====================
COMPONENTS OF NET ASSETS
Paid-in capital $ 46,771,739 $ 17,133,808
Undistributed net investment income (loss) (188,525) 7,858
Net realized gain (loss) from investments 3,694,476 (99,734)
Unrealized appreciation of investments 14,429,013 4,077,305
-------------------- --------------------
NET ASSETS $ 64,706,703 $ 21,119,237
==================== ====================
SHARES OF BENEFICIAL INTEREST 5,259,176 2,042,636
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION
PRICE PER SHARE $ 12.30 $ 10.34
See Notes to Financial Statements 6 FORUM FUNDS[R]
<PAGE>
- ---------------------------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS (unaudited)
PERIOD ENDED NOVEMBER 30, 1999
- ---------------------------------------------------------------------------------------------------
BIA BIA
SMALL-CAP GROWTH
GROWTH EQUITY
FUND FUND
-------------------- --------------------
INVESTMENT INCOME
Interest income $ 73,612 $ 20,480
Dividend income 4,113 71,771
-------------------- --------------------
Total Investment Income 77,725 92,251
-------------------- --------------------
EXPENSES
Investment advisory (Note 3) 213,319 55,067
Administration (Note 3) 21,332 16,889
Transfer agency (Note 3) 7,657 7,660
Custody 6,678 7,364
Accounting (Note 3) 17,200 17,200
Audit 5,500 4,750
Legal 52 17
Trustees 1,319 450
Reporting 5,200 1,800
Compliance 14,907 14,606
Miscellaneous 1,273 625
-------------------- --------------------
Total Expenses 294,437 126,428
Fees waived (Note 4) (28,187) (52,919)
-------------------- --------------------
Net Expenses 266,250 73,509
-------------------- --------------------
NET INVESTMENT INCOME (LOSS) (188,525) 18,742
-------------------- --------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS
Net realized gain (loss) on investments 3,694,476 (99,734)
Net change in unrealized appreciation on investments 8,348,255 692,981
-------------------- --------------------
NET REALIZED AND UNREALIZED GAIN ON
INVESTMENTS 12,042,731 593,247
-------------------- --------------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $ 11,854,206 $ 611,989
==================== ====================
See Notes to Financial Statements 7 FORUM FUNDS[R]
<PAGE>
- ----------------------------------------------------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS (unaudited)
PERIOD ENDED NOVEMBER 30, 1999
- ----------------------------------------------------------------------------------------------------------------------------
BIA BIA
SMALL-CAP GROWTH
GROWTH EQUITY
FUND FUND
----------------------------- ------------------------------
Amount Shares Amount Shares
NET ASSETS - June 28, 1999 (Note 1) $ - $ -
--------------- ---------------
OPERATIONS
Net investment income (loss) (188,525) 18,742
Net realized gain (loss) on investments sold 3,694,476 (99,734)
Net change in unrealized appreciation of investments 8,348,255 692,981
--------------- ---------------
Net Increase in Net Assets Resulting from Operations 11,854,206 611,989
--------------- ---------------
DISTRIBUTIONS TO SHAREHOLDERS FROM
Net investment income on investments - (10,884)
--------------- ---------------
CAPITAL SHARE TRANSACTIONS
Sale of shares 15,762,206 1,543,324 10,059,549 996,844
Transactions due to acquistion 39,482,102 3,948,210 11,053,062 1,105,306
Reinvestment of distribution's - - 7 1
Redemption of shares (2,391,811) (232,358) (594,486) (59,515)
--------------- ------------ --------------- ------------
Net Increase from Capital Transactions 52,852,497 5,259,176 20,518,132 2,042,636
--------------- ============ --------------- ============
Net Increase in Net Assets 64,706,703 21,119,237
--------------- ---------------
NET ASSETS - November 30, 1999 (A) $ 64,706,703 $ 21,119,237
=============== ===============
(A) Undistributed net investment
income (loss) $ (188,525) $ 7,858
=============== ===============
See Notes to Financial Statements 8 FORUM FUNDS[R]
<PAGE>
- ---------------------------------------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (unaudited)
- ---------------------------------------------------------------------------------------------------------------------
These financial highlights reflect selected data and ratios for a share
outstanding throughout the period:
BIA BIA
SMALL-CAP GROWTH
GROWTH EQUITY
FUND FUND
------------------------ ------------------------
June 28, 1999 (b) June 28, 1999 (b)
to to
November 30, 1999 November 30, 1999
------------------------ ------------------------
NET ASSET VALUE, Beginning of Period $10.00 $10.00
------------------------ ------------------------
OPERATIONS
Net investment income (loss) (0.04) 0.01
Net realized and unrealized gain on investments 2.34 0.34
------------------------ ------------------------
Total from Investment Operations 2.30 0.35
------------------------ ------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM
Net investment income - (0.01)
------------------------ -------------------------
NET ASSET VALUE, End of Period $12.30 $10.34
======================== ========================
TOTAL RETURN 23.00% 3.47%
RATIO/SUPPLEMENTARY DATA
Net assets at end of period (000's omitted) $64,707 $21,119
Ratios to Average Net Assets
Expenses, including waiver of fees (a) 1.25% 1.00%
Expenses, excluding waiver of fees (a) 1.38% 1.72%
Net investment income (loss), including waiver of fees (a) (0.88%) 0.26%
PORTFOLIO TURNOVER RATE 24% 19%
</TABLE>
- ------------------------------------------------------------------
(a) Annualized.
(b) See Note 1 in Notes to Financial Statements for commencement of operations.
See Notes to Financial Statements 9 FORUM FUNDS[R]
<PAGE>
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (unaudited)
NOVEMBER 30, 1999
- --------------------------------------------------------------------------------
NOTE 1. ORGANIZATION
This report relates to BIA Small-Cap Growth Fund and BIA Growth Equity Fund
(individually a "Fund", and collectively, "the Funds"), each a diversified
series of Forum Funds(R) (the "Trust"). 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 BIA Small-Cap Growth
Fund and BIA Growth Equity Fund commenced operations on June 28, 1999 after
acquiring the net assets of BIA Small-Cap Growth Fund Limited Partnership and
BIA Growth Equity Fund Limited Partnership (each a "Partnership," collectively
the "Partnerships"), respectively. Each Fund issued shares in exchange for the
net assets of its corresponding Partnership. Under its Trust Instrument, the
Trust is authorized to issue an unlimited number of each Fund's shares of
beneficial interest without par value.
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 period. Actual amounts could differ from these
estimates. The following summarizes the significant accounting policies of each
Fund:
SECURITY VALUATION - On each Fund business day, the Trust determines the net
asset value per share of each Fund as of the close of the regular trading day on
the New York Stock Exchange. Securities, other than short-term securities, held
by each Fund, and for which market quotations are readily available, are valued
using the last reported sales price provided by independent pricing services. If
no sales price is reported, the mean of the last bid and ask price is used. In
the absence of readily available market quotations, securities are valued at
fair value as determined by the Trust's Board of Trustees pursuant to the
Trust's valuation procedures. Securities that mature in sixty days or less are
valued at amortized cost, which approximates market value.
SECURITY TRANSACTIONS AND INVESTMENT INCOME - Investment transactions are
accounted for on trade date. Dividend income is recorded on the ex-dividend
date. Interest income is recorded as earned. Identified cost of investments sold
is used to determine gain and loss for both financial statement and federal
income tax purposes.
REPURCHASE AGREEMENTS - Each Fund may invest in repurchase agreements. Each
Fund, through its custodian, receives delivery of the underlying securities,
whose market value must always equal or exceed the repurchase price. In the
event of default, the Fund may have difficulties disposing of such securities.
DISTRIBUTIONS TO SHAREHOLDERS - Distributions to shareholders of net investment
income and net capital gain, if any, are declared and paid at least annually.
Distributions are based on amounts calculated in accordance with applicable
federal income tax regulations, which may differ from generally accepted
accounting principles. These differences are due primarily to differing
treatments of income and gain on various investment securities held by a Fund,
timing differences and differing characterizations of distributions made by the
Fund.
FEDERAL TAXES - Each Fund intends to qualify each year as a regulated investment
company and distribute all its taxable income. In addition, by distributing in
each calendar year substantially all 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.
EXPENSE ALLOCATION - The Trust is comprised of nineteen active fund series and
it accounts separately for the assets, liabilities and operations of each of its
funds. Expenses that are directly attributable to more than one fund are
allocated among the respective funds in proportion to each fund's average daily
net assets.
10 FORUM FUNDS[R]
<PAGE>
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (unaudited) (continued)
NOVEMBER 30, 1999
- --------------------------------------------------------------------------------
NOTE 3. ADVISORY FEES AND OTHER TRANSACTIONS WITH RELATED PARTIES
INVESTMENT ADVISER - The investment adviser to each Fund is Brown Investment
Advisory & Trust Company, (the "Adviser") a fully owned subsidiary of Brown
Capital Holdings Incorporated. Pursuant to an Investment Advisory Agreement, the
Adviser receives an advisory fee from BIA Small-Cap Growth Fund and BIA Growth
Equity Fund at an annual rate of 1.00% and 0.75%, respectively, of each Fund's
average daily net assets.
ADMINISTRATOR - The administrator of each Fund is Forum Administrative Services,
LLC ("FAdS"). For its services, FAdS receives an administrative fee at an annual
rate of 0.10% of the first $100 million, and 0.075% of the remaining average
daily net assets of each Fund, subject to a $40,000 minimum.
TRANSFER AGENT - The transfer agent and dividend disbursing agent for each Fund
is Forum Shareholder Services, LLC ("FSS"). FSS receives from each Fund an
annual fee of $18,000, plus certain shareholder account fees.
DISTRIBUTOR - Forum Fund Services, LLC ("FFS"), a registered broker-dealer and a
member of the National Association of Securities Dealers, Inc., is each Fund's
distributor. FFS receives no compensation for its distribution services.
OTHER SERVICE PROVIDER - Forum Accounting Services, LLC ("FAcS") provides fund
accounting services to each Fund. For its services, FAcS receives from each Fund
an annual fee of $39,000, plus certain amounts based upon the asset levels of
the Funds as well as the number and type of portfolio transactions made by the
Fund.
NOTE 4. WAIVER OF FEES
The Adviser voluntarily waived fees for the period June 28, 1999 to November 30,
1999 as follows: BIA Small-Cap Growth Fund, $28,187 and BIA Growth Equity Fund,
$52,919.
NOTE 5. SECURITY TRANSACTIONS
The cost of purchases and proceeds from sales of securities, other than
short-term investments, for the period June 28, 1999 to November 30, 1999, were
as follows:
BIA BIA
SMALL-CAP GROWTH FUND GROWTH EQUITY FUND
Cost of Purchases $18,172,494 $2,539,712
Proceeds from Sales 11,180,496 3,113,360
NOTE 6. ACQUISITION OF FUNDS
As of June 28, 1999, BIA Small-Cap Growth Fund and BIA Growth Equity Fund
acquired all of the net assets of BIA Small-Cap Growth Fund Limited Partnership
and BIA Growth Equity Fund Limited Partnership, respectively. Each Partnership's
net assets and unrealized gain immediately prior to acquisition were as follows:
NET ASSETS UNREALIZED GAINS
BIA Small-Cap Growth Fund Limited Partnership $39,482,102 $6,080,758
BIA Growth Equity Fund Limited Partnership 11,053,062 3,384,324
The net assets of BIA Small-Cap Growth Fund and BIA Growth Equity Fund
immediately after the acquisition were $39,482,102 and $11,053,062,
respectively. The shares issued as a result of the acquisition amounted to
3,948,210 and 1,105,306, respectively.
11 FORUM FUNDS[R]
<PAGE>
[Blue Banner]
INVESTMENT ADVISER
Brown Investment Advisory & Trust Company
Furness House
19 South Street
Baltimore, MD 21202
DISTRIBUTOR
Forum Fund Services, LLC
Two Portland Square
Portland, Maine 04101
TRANSFER AGENT
Forum Shareholder Services, LLC
Two Portland Square
Portland, Maine 04101
This report is authroized for distribution only to shareholders and
to others who have received a copy of the Funds prospectuses.
<PAGE>
