ANNUAL
REPORT
June 30, 2000
Tax-Free Money Fund
California Tax-Free Money Fund
Ohio Tax-Free Money Fund
[LOGO]
Florida Tax-Free Money Fund THE MARK OF EXCELLENCE(SM)
Tax-Free Intermediate Term Fund
Ohio Insured Tax-Free Fund
TOUCHSTONE
[LOGO]---------------------------------
Family of Funds
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<PAGE>
TABLE OF CONTENTS
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Page
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Letter from the President 3
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Management Discussion and Analysis 4-6
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Statements of Assets and Liabilities 7-9
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Statements of Operations 10-12
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Statements of Changes in Net Assets 13-15
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Financial Highlights 16-22
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Notes to Financial Statements 23-31
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Portfolios of Investments:
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Tax-Free Money Fund 32-33
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California Tax-Free Money Fund 34-36
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Ohio Tax-Free Money Fund 37-41
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Florida Tax-Free Money Fund 42-43
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Tax-Free Intermediate Term Fund 44-46
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Ohio Insured Tax-Free Fund 47-49
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Notes to Portfolios of Investments 50
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Results of Special Meeting of Shareholders 51
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Report of Independent Auditors 52
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TOUCHSTONE FAMILY OF FUNDS
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<PAGE>
LETTER FROM THE PRESIDENT
================================================================================
Dear Fellow Shareholders: [PICTURE]
Touchstone is pleased to present Touchstone Tax-Free Trust's Annual Report for
the fiscal year ended June 30, 2000. This report provides financial data and
performance information for the Tax-Free Money Fund, California Tax-Free Money
Fund, Ohio Tax-Free Money Fund, Florida Tax-Free Money Fund, Tax-Free
Intermediate Term Fund and Ohio Insured Tax-Free Fund. These Funds represent the
six tax-free money market and bond products currently offered among the 20
mutual funds which comprise the Touchstone Family of Funds.
At Touchstone, we believe you deserve nothing less than excellence in the
financial products and services you select, as well as in the results you enjoy.
Our goal has always been to provide our customers with a wide variety of
products and services. Touchstone's expanded offering now includes U.S. and
international equity funds, taxable and tax-free bond funds and money market
funds.
The stock market experienced a wild ride during the second quarter of 2000. A
sharp April correction took the S&P 500 down over 11% from the March record
high. The tech-heavy NASDAQ Composite fell a dramatic 36% from its peak before
some relief came in late May. For the quarter, the S&P 500 lost 2.7% and the
NASDAQ Composite declined 13.3%. The bond market, while also volatile, was
modestly higher in the quarter as the Lehman Aggregate Bond Index rose 1.7%.
The spring stock market correction served as a healthy consolidation of the huge
gains in technology stocks over the previous six months. We believe the pullback
dampened speculative enthusiasm and should be beneficial in the long run.
The correction and subsequent rebound also reflect investors' adjustment to the
changing economic outlook. Strong first quarter growth raised fears that the
Federal Reserve would have to get tougher to slow the economy, a negative for
stock and bond valuations and profit potential. Indeed, the Fed raised the fed
funds rate by 50 basis points at its May monetary policy meeting. Now, with
signs of a slowing economy, investors are hopeful that the Fed may be out of the
picture as the economy eases to a soft landing. This outlook has helped stocks
and fixed income securities continue to rally into July.
The Treasury announced that the issuance of long-term Treasury debt would be
reduced and that outstanding supply would be bought back. As a result, the yield
curve inverted, with short-term Treasuries yielding more than longer-term
issues. Many fixed income sectors were negatively impacted. In the municipal
bond market, however, limited new issue supply and attractive yields caused
investors to step up demand. The municipal sector performed quite well during
the first and second quarters of 2000, creating an attractive opportunity for
tax-conscious investors.
Touchstone remains committed to providing products and services that help
investors meet their financial goals. Our success has been built on the
confidence investors have extended to us. We thank you for your support and look
forward to offering continued service to you in the future.
Sincerely,
/s/ Jill McGruder
Jill McGruder
President
Touchstone Family of Funds
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<PAGE>
MANAGEMENT DISCUSSION AND ANALYSIS
================================================================================
OVERVIEW
The past year proved to be one of superlatives for the economy. Growth remained
impressive with the current expansion marking its ninth anniversary. Strong job
growth, rising incomes and a continuation of the bull market in stocks provided
the impetus for rising consumption. The housing market experienced record
growth, and with consumer confidence at historically high levels, retail sales
were robust. Commodity prices, most notably oil, and wages began to move higher
prompting concern that inflation would be on the rise. The combination of
accelerating economic growth and heightened inflation fears forced the Fed into
action. The Fed began tapping the brakes at the end of the second quarter of
1999, and over the course of the next twelve months raised the fed funds rate a
total of 1.75% bringing it to 6.50%.
Interest rates rose and the Treasury curve "flattened" in response to tighter
monetary policy. In February 2000 the Treasury announced that the issuance of
long-term Treasury debt would be reduced and that it would begin to buy back
Treasury debt further reducing outstanding supply. The combination of the Fed
raising interest rates and the Treasury buyback program caused an inversion of
the yield curve with short-term Treasuries yielding more than longer-term
issues. Strong demand for Treasuries caused other sectors of the bond market to
perform poorly as yield spreads in these sectors widened out relative to
Treasury securities. Municipals were negatively impacted as well and long term
municipal bonds were soon trading at yields nearly equal to comparable maturity
Treasury securities. Limited new issue supply and attractive yields, however,
caused investors to step up their demand for municipal bonds helping the
municipal sector to perform quite well during the first and second quarters of
2000.
TAX-FREE INTERMEDIATE TERM FUND
The Tax-Free Intermediate Term Fund seeks high current income exempt from
federal income tax, consistent with the protection of capital, by investing
primarily in high-grade municipal obligations maturing within twenty years or
less with a dollar-weighted average portfolio maturity under normal conditions
of between three and ten years. To the extent consistent with the Fund's primary
objective, capital appreciation is a secondary objective. For the fiscal year
ended June 30, 2000, the Fund's total returns (excluding the impact of
applicable sales loads) were 2.75% and 1.88% for Class A and Class C shares,
respectively. The Lehman Brothers 5-Year Municipal G.O. Bond Index returned
3.66% during the same period.
Our objective in managing the Tax-Free Intermediate Term Fund remains to
maximize the tax-free yield while minimizing share price volatility. In pursuing
this strategy we typically invest in premium bonds which we can often buy at
attractive prices compared to current coupon issues. Thus we can buy issues,
which provide us with better yield, and also cushion the Fund if interest rates
should increase. For the year ended June 30, 2000, the Fund outperformed its
Lipper peers, which were up 2.50%, and performed comparable to the Lehman
Brothers Index when the operating expenses of the Fund are taken into
consideration. During the second quarter of the year, strong investor demand for
intermediate bonds helped this sector outperform the longer-term sector. We used
strength in the municipal market during the period to sell lower rated issues
and reinvested proceeds into higher quality issues that we believe will perform
better as we move forward. The municipal market remains a very attractive
investment for individuals looking to diversify their portfolios and earn
tax-free income. The new issue supply in the market should continue to be lower
than what has been experienced in recent years, and this should help municipals
perform well relative to other bond market sectors.
TOUCHSTONE FAMILY OF FUNDS
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MANAGEMENT DISCUSSION AND ANALYSIS
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OHIO INSURED TAX-FREE FUND
The Ohio Insured Tax-Free Fund seeks the highest level of interest income exempt
from federal income tax and Ohio personal income tax, consistent with the
protection of capital. The Fund invests primarily in high and medium-quality,
long-term Ohio municipal obligations which are protected by insurance
guaranteeing the payment of principal and interest in the event of a default.
For the fiscal year ended June 30, 2000, the Fund's total returns (excluding the
impact of applicable sales loads) were 2.60% and 1.75% for Class A and Class C
shares, respectively. The Lehman Brothers 15-Year Municipal G.O. Bond Index
returned 3.99% during the same period.
For the year ended June 30, 2000, the Ohio Tax-Free Insured Fund outperformed
its Lipper peer group, which was up 1.04%, by a significant margin and slightly
underperformed the Lehman Brothers 15-year municipal G.O. Bond Index after
factoring in the associated expenses of the Fund. Over the course of the fiscal
year we initiated several swaps in the portfolio to improve performance
characteristics. More specifically, we sold issues with shorter call features
and bought new issues with longer call protection. Additionally, we executed
several tax swaps. This involves selling and buying similar bonds so as to
realize a loss without materially changing the portfolio. The losses can then be
used to offset future potential gains allowing us to be more tax efficient. For
new purchases in the Fund, we will continue to focus on issues in the 20-year
maturity range offering call protection of at least ten years. We believe these
issues provide the best combination of yield and total return. The outlook for
the municipal market remains favorable. Limited new issue supply should continue
to help municipal bonds perform well relative to other bond market sectors, and
longer maturity municipals to trade at very attractive levels compared to
Treasuries.
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MANAGEMENT DISCUSSION AND ANALYSIS
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COMPARISON OF THE CHANGE IN VALUE SINCE JUNE 30, 1990
OF A $10,000 INVESTMENT IN THE TAX-FREE INTERMEDIATE TERM FUND - CLASS A*
AND THE LEHMAN BROTHERS 5-YEAR MUNICIPAL G.O. BOND INDEX
[GRAPHIC OMITTED]
6/00
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TAX-FREE INTERMEDIATE TERM FUND - CLASS A $16,386
LEHMAN BROTHERS 5-YEAR MUNICIPAL G.O. BOND INDEX $18,198
Past performance is not predictive of future performance.
--------------------------------------------------------
Tax-Free Intermediate Term Fund
Average Annual Total Returns
1 Year 5 Years 10 Years Since Inception*
CLASS A -2.13% 3.21% 5.06% 5.71%
CLASS C 0.61% 3.25% -- 2.88%
--------------------------------------------------------
* The chart above represents performance of Class A shares only, which will vary
from the performance of Class C shares based on the difference in loads and fees
paid by shareholders in the different classes. Fund inception was September 10,
1981, and the initial public offering of Class C shares commenced on February 1,
1994.
COMPARISON OF THE CHANGE IN VALUE SINCE JUNE 30, 1990
OF A $10,000 INVESTMENT IN THE OHIO INSURED TAX-FREE FUND - CLASS A*
AND THE LEHMAN BROTHERS 15-YEAR MUNICIPAL G.O. BOND INDEX
[GRAPHIC OMITTED]
6/00
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OHIO INSURED TAX-FREE FUND - CLASS A $17,423
LEHMAN BROTHERS 15-YEAR MUNICIPAL G.O. BOND INDEX $20,782
Past performance is not predictive of future performance.
--------------------------------------------------------
Ohio Insured Tax-Free Fund
Average Annual Total Returns
1 Year 5 Years 10 Years Since Inception*
Class A -2.27% 3.73% 5.71% 6.88%
Class C 0.48% 3.74% -- 3.25%
--------------------------------------------------------
* The chart above represents performance of Class A shares only, which will vary
from the performance of Class C shares based on the difference in loads and fees
paid by shareholders in the different classes. Fund inception was April 1, 1985,
and the initial public offering of Class C shares commenced on November 1, 1993.
TOUCHSTONE FAMILY OF FUNDS
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<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
JUNE 30, 2000
================================================================================
California
Tax-Free Tax-Free
(000's) Money Fund Money Fund
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ASSETS
Investment securities:
At acquisition cost .................... $ 25,151 $ 66,489
============================
At amortized cost ...................... $ 25,132 $ 66,411
============================
At market value (Note 2) ............... $ 25,132 $ 66,411
Cash ....................................... 23 308
Interest receivable ........................ 252 567
Other assets ............................... 10 2
----------------------------
TOTAL ASSETS ............................... 25,417 67,288
----------------------------
LIABILITIES
Dividends payable .......................... 1 3
Payable to affiliates (Note 4) ............. 14 50
Payable for securities purchased ........... 200 4,315
Other accrued expenses and liabilities ..... 8 20
----------------------------
TOTAL LIABILITIES .......................... 223 4,388
----------------------------
NET ASSETS ................................. $ 25,194 $ 62,900
============================
NET ASSETS CONSIST OF:
Paid-in capital ............................ $ 25,197 $ 62,900
Accumulated net realized losses from security
transactions ............................. (3) --
----------------------------
NET ASSETS ................................. $ 25,194 $ 62,900
============================
Shares of beneficial interest outstanding
(unlimited number of shares authorized,
no par value) (Note 5) ................... 25,208 62,900
============================
Net asset value, offering price and redemption
price per share (Note 2) ................. $ 1.00 $ 1.00
============================
See accompanying notes to financial statements.
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STATEMENTS OF ASSETS AND LIABILITIES
JUNE 30, 2000
================================================================================
OHIO FLORIDA
TAX-FREE TAX-FREE
(000'S) MONEY FUND MONEY FUND
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ASSETS
Investment securities:
At acquisition cost .................... $ 345,254 $ 18,109
============================
At amortized cost ...................... $ 345,159 $ 18,077
============================
At market value (Note 2) ............... $ 345,159 $ 18,077
Cash ....................................... -- 72
Interest receivable ........................ 3,567 165
Other assets ............................... 12 3
----------------------------
TOTAL ASSETS ............................... 348,738 18,317
----------------------------
LIABILITIES
Bank overdraft ............................. 590 --
Dividends payable .......................... 469 54
Payable to affiliates (Note 4) ............. 192 9
Other accrued expenses and liabilities ..... 37 10
----------------------------
TOTAL LIABILITIES .......................... 1,288 73
----------------------------
NET ASSETS ................................. $ 347,450 $ 18,244
============================
NET ASSETS CONSIST OF:
Paid-in capital ............................ $ 347,452 $ 18,257
Accumulated net realized losses from security
transactions ............................. (2) (13)
----------------------------
NET ASSETS ................................. $ 347,450 $ 18,244
============================
PRICING OF RETAIL SHARES
Net assets applicable to Retail shares ..... $ 214,561 $ 18,244
============================
Shares of beneficial interest outstanding
(unlimited number of shares authorized,
no par value) (Note 5) ................... 214,557 18,257
============================
Net asset value, offering price and redemption
price per share (Note 2) ................. $ 1.00 $ 1.00
============================
PRICING OF INSTITUTIONAL SHARES
Net assets applicable to Institutional shares $ 132,889 $ --
============================
Shares of beneficial interest outstanding
(unlimited number of shares authorized,
no par value) (Note 5) ................... 132,895 --
============================
Net asset value, offering price and redemption
price per share (Note 2) ................. $ 1.00 $ --
============================
See accompanying notes to financial statements.
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<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
JUNE 30, 2000
================================================================================
TAX-FREE OHIO INSURED
INTERMEDIATE TAX-FREE
(000'S) TERM FUND FUND
--------------------------------------------------------------------------------
ASSETS
Investment securities:
At acquisition cost .................... $ 39,584 $ 62,488
============================
At amortized cost ...................... $ 39,401 $ 62,405
============================
At market value (Note 2) ............... $ 39,571 $ 63,628
Cash ....................................... 100 758
Interest receivable ........................ 628 590
Receivable for capital shares sold ......... 25 504
Other assets ............................... 19 12
----------------------------
TOTAL ASSETS ............................... 40,343 65,492
----------------------------
LIABILITIES
Dividends payable .......................... 33 80
Payable for capital shares redeemed ........ 79 1,218
Payable for securities purchased ........... -- 957
Payable to affiliates (Note 4) ............. 26 35
Other accrued expenses and liabilities ..... 14 17
----------------------------
TOTAL LIABILITIES .......................... 152 2,307
----------------------------
NET ASSETS ................................. $ 40,191 $ 63,185
============================
NET ASSETS CONSIST OF:
Paid-in capital ............................ $ 40,861 $ 62,286
Accumulated net realized losses from security
transactions ............................. (840) (324)
Net unrealized appreciation on investments . 170 1,223
----------------------------
NET ASSETS ................................. $ 40,191 $ 63,185
============================
PRICING OF CLASS A SHARES
Net assets applicable to Class A shares .... $ 36,817 $ 59,600
============================
Shares of beneficial interest outstanding
(unlimited number of shares authorized, no
par value) (Note 5) ...................... 3,446 5,207
============================
Net asset value and redemption price per
share (Note 2) ........................... $ 10.68 $ 11.45
============================
Maximum offering price per share (Note 2) .. $ 11.21 $ 12.02
============================
PRICING OF CLASS C SHARES
Net assets applicable to Class C shares .... $ 3,374 $ 3,585
============================
Shares of beneficial interest outstanding
(unlimited number of shares authorized, no
par value) (Note 5) ...................... 316 313
============================
Net asset value and redemption price per
share (Note 2) ........................... $ 10.68 $ 11.44
============================
Maximum offering price per share (Note 2) .. $ 10.82 $ 11.58
============================
See accompanying notes to financial statements.
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STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED JUNE 30, 2000
================================================================================
CALIFORNIA
TAX-FREE TAX-FREE
(000'S) MONEY FUND MONEY FUND
--------------------------------------------------------------------------------
INVESTMENT INCOME
Interest income ............................ $ 1,079 $ 2,209
----------------------------
EXPENSES
Investment advisory fees (Note 4) .......... 134 317
Accounting services fees (Note 4) .......... 30 36
Transfer agent fees (Note 4) ............... 30 27
Distribution expenses (Note 4) ............. 2 34
Custodian fees ............................. 12 19
Postage and supplies ....................... 17 6
Professional fees .......................... 9 11
Registration fees .......................... 14 6
Trustees' fees and expenses ................ 8 9
Reports to shareholders .................... 5 3
Pricing expenses ........................... 2 5
Insurance expense .......................... 1 4
Other expenses ............................. 2 1
----------------------------
TOTAL EXPENSES ............................. 266 478
Fees waived by the Adviser (Note 4) ........ (28) --
----------------------------
NET EXPENSES ............................... 238 478
----------------------------
NET INVESTMENT INCOME ...................... 841 1,731
----------------------------
NET REALIZED GAINS FROM SECURITY TRANSACTIONS -- 13
----------------------------
NET INCREASE IN NET ASSETS FROM OPERATIONS . $ 841 $ 1,744
============================
See accompanying notes to financial statements.
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STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED JUNE 30, 2000
================================================================================
OHIO FLORIDA
TAX-FREE TAX-FREE
(000'S) MONEY FUND MONEY FUND
--------------------------------------------------------------------------------
INVESTMENT INCOME
Interest income ............................ $ 14,723 $ 968
----------------------------
EXPENSES
Investment advisory fees (Note 4) .......... 1,689 133
Distribution expenses, Retail class (Note 4) 510 16
Accounting services fees (Note 4) .......... 73 41
Transfer agent fees, Retail class (Note 4) . 72 12
Transfer agent fees, Institutional class (Note 4) 12 10
Custodian fees (Note 4) .................... 65 13
Insurance expense .......................... 43 4
Postage and supplies ....................... 39 2
Professional fees .......................... 28 8
Registration fees .......................... 24 1
Trustees' fees and expenses ................ 8 8
Pricing expenses ........................... 11 3
Reports to shareholders .................... 5 1
Other expenses ............................. 13 3
----------------------------
TOTAL EXPENSES ............................. 2,592 255
Fees waived by the Adviser (Note 4) ........ (80) (82)
----------------------------
NET EXPENSES ............................... 2,512 173
NET INVESTMENT INCOME ...................... 12,211 795
----------------------------
NET REALIZED LOSSES FROM SECURITY TRANSACTIONS (12) (2)
----------------------------
NET INCREASE IN NET ASSETS FROM OPERATIONS . $ 12,199 $ 793
============================
See accompanying notes to financial statements.
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STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED JUNE 30, 2000
================================================================================
TAX-FREE OHIO INSURED
INTERMEDIATE TAX-FREE
(000'S) TERM FUND FUND
--------------------------------------------------------------------------------
INVESTMENT INCOME
Interest income ............................ $ 2,571 $ 3,672
----------------------------
EXPENSES
Investment advisory fees (Note 4) .......... 236 315
Transfer agent fees, Class A (Note 4) ...... 48 30
Transfer agent fees, Class C (Note 4) ...... 12 12
Accounting services fees (Note 4) .......... 45 48
Distribution expenses, Class A (Note 4) .... 31 6
Distribution expenses, Class C (Note 4) .... 16 18
Postage and supplies ....................... 33 17
Registration fees, Common .................. 5 6
Registration fees, Class A ................. 10 4
Registration fees, Class C ................. 9 2
Pricing expenses ........................... 12 13
Custodian fees ............................. 10 13
Professional fees .......................... 11 11
Trustees' fees and expenses ................ 8 8
Reports to shareholders .................... 9 6
Insurance expense .......................... 3 5
Other expenses ............................. 3 5
TOTAL EXPENSES ............................. 501 519
Fees waived by the Adviser (Note 4) ........ (5) (14)
----------------------------
NET INVESTMENT INCOME ...................... 2,075 3,167
----------------------------
REALIZED AND UNREALIZED LOSSES ON INVESTMENTS
Net realized losses from security transactions (478) (250)
Net change in unrealized appreciation/depreciation
on investments ........................... (481) (1,307)
----------------------------
NET REALIZED AND UNREALIZED LOSSES ON INVESTMENTS (959) (1,557)
----------------------------
NET INCREASE IN NET ASSETS FROM OPERATIONS . $ 1,116 $ 1,610
============================
See accompanying notes to financial statements.
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<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS
==============================================================================================================
CALIFORNIA
TAX-FREE TAX-FREE
MONEY FUND MONEY FUND
----------------------------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
(000'S) 2000 1999 2000 1999
--------------------------------------------------------------------------------------------------------------
FROM OPERATIONS
<S> <C> <C> <C> <C>
Net investment income ...................................... $ 841 $ 783 $ 1,731 $ 1,401
Net realized gains (losses) from security transactions ..... -- (2) 13 (12)
----------------------------------------------
NET INCREASE IN NET ASSETS FROM OPERATIONS ................. 841 781 1,744 1,389
----------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income ................................. (847) (777) (1,731) (1,401)
----------------------------------------------
FROM CAPITAL SHARE TRANSACTIONS (NOTE 5)
Proceeds from shares sold .............................. 48,617 48,307 333,265 196,122
Reinvested distributions ............................... 839 751 1,665 1,332
Payments for shares redeemed ........................... (49,490) (61,211) (320,010) (190,488)
----------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL
SHARE TRANSACTIONS ..................................... (34) (12,153) 14,920 6,966
----------------------------------------------
TOTAL INCREASE (DECREASE) IN NET ASSETS .................... (40) (12,149) 14,933 6,954
NET ASSETS
Beginning of year .......................................... 25,234 37,383 47,967 41,013
----------------------------------------------
End of year ................................................ $ 25,194 $ 25,234 $ 62,900 $ 47,967
==============================================
UNDISTRIBUTED NET INVESTMENT INCOME ........................ $ -- $ 6 $ -- $ --
==============================================
</TABLE>
See accompanying notes to financial statements.
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<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS
==============================================================================================================
OHIO FLORIDA
TAX-FREE TAX-FREE
MONEY FUND MONEY FUND
----------------------------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
(000'S) 2000 1999 2000 1999
--------------------------------------------------------------------------------------------------------------
FROM OPERATIONS
<S> <C> <C> <C> <C>
Net investment income ...................................... $ 12,211 $ 10,174 $ 795 $ 1,596
Net realized losses from security transactions ............. (12) (3) (2) (11)
----------------------------------------------
NET INCREASE IN NET ASSETS FROM OPERATIONS ................. 12,199 10,171 793 1,585
----------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income, Retail ......................... (6,796) (5,927) (521) (501)
From net investment income, Institutional .................. (5,415) (4,247) (274) (1,095)
From net realized gains, Retail ............................ -- -- -- (6)
From net realized gains, Institutional ..................... -- -- -- (16)
----------------------------------------------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS
TO SHAREHOLDERS .......................................... (12,211) (10,174) (795) (1,618)
----------------------------------------------
FROM CAPITAL SHARE TRANSACTIONS (NOTE 5)
RETAIL
Proceeds from shares sold .................................. 392,668 455,007 32,945 29,958
Reinvested distributions ................................... 6,577 5,786 448 495
Payments for shares redeemed ............................... (399,368) (451,416) (36,511) (23,442)
----------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS FROM
RETAIL SHARE TRANSACTIONS ................................ (123) 9,377 (3,118) 7,011
INSTITUTIONAL
Proceeds from shares sold .................................. 322,144 459,806 45,795 67,739
Reinvested distributions ................................... 472 18 52 427
Payments for shares redeemed ............................... (365,828) (398,983) (61,138) (102,016)
----------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS FROM
INSTITUTIONAL SHARE TRANSACTIONS ......................... (43,212) 60,841 (15,291) (33,850)
----------------------------------------------
TOTAL INCREASE (DECREASE) IN NET ASSETS .................... (43,347) 70,215 (18,411) (26,872)
NET ASSETS
Beginning of year .......................................... 390,797 320,582 36,655 63,527
----------------------------------------------
End of year ................................................ $347,450 $390,797 $ 18,244 $ 36,655
==============================================
</TABLE>
See accompanying notes to financial statements.
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<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS
==============================================================================================================
TAX-FREE OHIO INSURED
INTERMEDIATE TAX-FREE
TERM FUND FUND
----------------------------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
(000'S) 2000 1999 2000 1999
--------------------------------------------------------------------------------------------------------------
FROM OPERATIONS
<S> <C> <C> <C> <C>
Net investment income ...................................... $ 2,075 $ 2,320 $ 3,167 $ 3,294
Net realized gains (losses) from security transactions ..... (478) 634 (250) 353
Net change in unrealized appreciation/depreciation
on investments ........................................... (481) (1,787) (1,307) (2,151)
----------------------------------------------
NET INCREASE IN NET ASSETS FROM OPERATIONS ................. 1,116 1,167 1,610 1,496
----------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income, Class A ........................ (1,930) (2,149) (2,986) (3,095)
From net investment income, Class C ........................ (145) (171) (181) (199)
From net realized gains, Class A ........................... -- -- -- (1,554)
From net realized gains, Class C ........................... -- -- -- (115)
----------------------------------------------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS
TO SHAREHOLDERS .......................................... (2,075) (2,320) (3,167) (4,963)
----------------------------------------------
FROM CAPITAL SHARE TRANSACTIONS (NOTE 5)
CLASS A
Proceeds from shares sold .................................. 10,950 13,620 66,103 142,439
Reinvested distributions ................................... 1,548 1,723 2,115 3,500
Payments for shares redeemed ............................... (22,700) (19,292) (69,927) (149,279)
----------------------------------------------
NET DECREASE IN NET ASSETS FROM CLASS A
SHARE TRANSACTIONS ....................................... (10,202) (3,949) (1,709) (3,340)
----------------------------------------------
CLASS C
Proceeds from shares sold .................................. 899 2,454 138 550
Reinvested distributions ................................... 131 158 152 268
Payments for shares redeemed ............................... (2,211) (2,620) (1,316) (1,038)
----------------------------------------------
NET DECREASE IN NET ASSETS FROM CLASS C
SHARE TRANSACTIONS ....................................... (1,181) (8) (1,026) (220)
----------------------------------------------
TOTAL DECREASE IN NET ASSETS ............................... (12,342) (5,110) (4,292) (7,027)
NET ASSETS
Beginning of year .......................................... 52,533 57,643 67,477 74,504
----------------------------------------------
End of year ................................................ $ 40,191 $ 52,533 $ 63,185 $ 67,477
==============================================
</TABLE>
See accompanying notes to financial statements.
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<PAGE>
<TABLE>
<CAPTION>
TAX-FREE MONEY FUND
FINANCIAL HIGHLIGHTS
=======================================================================================================
Per Share Data for a Share Outstanding Throughout Each Year
-------------------------------------------------------------------------------------------------------
Year Ended June 30,
---------------------------------------------------------
2000 1999 1998 1997 1996
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of year ..... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
---------------------------------------------------------
Net investment income .................... 0.032 0.027 0.030 0.029 0.031
---------------------------------------------------------
Dividends from net investment income ..... (0.032) (0.027) (0.030) (0.029) (0.031)
---------------------------------------------------------
Net asset value at end of year ........... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
=========================================================
Total return ............................. 3.22% 2.75% 3.03% 2.89% 3.15%
=========================================================
Net assets at end of year (000's) ........ $ 25,194 $ 25,234 $ 37,383 $ 30,126 $ 25,342
=========================================================
Ratio of net expenses to
average net assets(A) .................. 0.89% 0.89% 0.92% 0.99% 0.99%
Ratio of net investment income to
average net assets ..................... 3.15% 2.74% 2.98% 2.85% 3.09%
</TABLE>
(A) Absent fee waivers by the Adviser, the ratio of expenses to average net
assets would have been 1.00% and 0.95% for the years ended June 30, 2000
and 1999, respectively (Note 4).
<TABLE>
<CAPTION>
CALIFORNIA TAX-FREE MONEY FUND
FINANCIAL HIGHLIGHTS
==========================================================================================================
Per Share Data for a Share Outstanding Throughout Each Year
----------------------------------------------------------------------------------------------------------
Year Ended June 30,
------------------------------------------------------------
2000 1999 1998 1997 1996
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of year ..... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
------------------------------------------------------------
Net investment income .................... 0.027 0.025 0.029 0.028 0.029
------------------------------------------------------------
Dividends from net investment income ..... (0.027) (0.025) (0.029) (0.028) (0.029)
------------------------------------------------------------
Net asset value at end of year ........... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
============================================================
Total return ............................. 2.75% 2.56% 2.94% 2.81% 2.95%
============================================================
Net assets at end of year (000's) ........ $ 62,900 $ 47,967 $ 41,013 $ 32,186 $ 36,122
============================================================
Ratio of net expenses to
average net assets ..................... 0.75% 0.75% 0.77% 0.80% 0.80%(A)
Ratio of net investment income to
average net assets ..................... 2.72% 2.52% 2.89% 2.76% 2.88%
</TABLE>
(A) Absent fee waivers and/or expense reimbursements by the Adviser, the ratio
of expenses to average net assets would have been 0.82% for the year ended
June 30, 1996.
See accompanying notes to financial statements.
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<PAGE>
<TABLE>
<CAPTION>
OHIO TAX-FREE MONEY FUND - RETAIL
FINANCIAL HIGHLIGHTS
==========================================================================================================
Per Share Data for a Share Outstanding Throughout Each Year
----------------------------------------------------------------------------------------------------------
Year Ended June 30,
------------------------------------------------------------
2000 1999 1998 1997 1996
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of year ..... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
------------------------------------------------------------
Net investment income .................... 0.031 0.027 0.030 0.030 0.031
------------------------------------------------------------
Dividends from net investment income ..... (0.031) (0.027) (0.030) (0.030) (0.031)
------------------------------------------------------------
Net asset value at end of year ........... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
============================================================
Total return ............................. 3.09% 2.73% 3.07% 2.99% 3.14%
============================================================
Net assets at end of year (000's) ........ $214,561 $214,691 $205,316 $166,719 $240,323
============================================================
Ratio of net expenses to
average net assets(A) .................. 0.75% 0.75% 0.75% 0.75% 0.75%
Ratio of net investment income to
average net assets ..................... 3.04% 2.68% 3.02% 2.93% 3.09%
</TABLE>
(A) Absent fee waivers and/or expense reimbursements by the Adviser, the ratio
of expenses to average net assets would have been 0.77%, 0.77%, 0.76% and
0.77% for the years ended June 30, 2000, 1999, 1998 and 1997, respectively
(Note 4).
<TABLE>
<CAPTION>
OHIO TAX-FREE MONEY FUND - INSTITUTIONAL
FINANCIAL HIGHLIGHTS
==============================================================================================
PER SHARE DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
----------------------------------------------------------------------------------------------
PERIOD
YEAR ENDED JUNE 30, ENDED
---------------------------------- JUNE 30,
2000 1999 1998 1997(A)
----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net asset value at beginning of period ... $ 1.000 $ 1.000 $ 1.000 $ 1.000
------------------------------------------------
Net investment income .................... 0.033 0.029 0.033 0.016
------------------------------------------------
Dividends from net investment income ..... (0.033) (0.029) (0.033) (0.016)
------------------------------------------------
Net asset value at end of period ......... $ 1.000 $ 1.000 $ 1.000 $ 1.000
================================================
Total return ............................. 3.35% 2.98% 3.33% 3.31%(C)
================================================
Net assets at end of period (000's) ...... $132,889 $176,106 $115,266 $ 97,589
================================================
Ratio of net expenses to average net
assets(B) .............................. 0.50% 0.50% 0.50% 0.50%(C)
Ratio of net investment income to average
net assets ............................. 3.25% 2.93% 3.27% 3.28%(C)
</TABLE>
(A) Represents the period from the initial public offering of Institutional
shares (January 7, 1997) through June 30, 1997.
(B) Absent fee waivers and/or expense reimbursements by the Adviser, the ratio
of expenses to average net assets would have been 0.52%, 0.51%, 0.52% and
0.56%(C) for the periods ended June 30, 2000, 1999, 1998 and 1997,
respectively (Note 4).
(C) Annualized.
See accompanying notes to financial statements.
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<PAGE>
<TABLE>
<CAPTION>
FLORIDA TAX-FREE MONEY FUND - RETAIL
FINANCIAL HIGHLIGHTS
==========================================================================================================
Per Share Data for a Share Outstanding Throughout Each Year
----------------------------------------------------------------------------------------------------------
Year Ended June 30,
------------------------------------------------------------
2000 1999 1998 1997 1996
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of year ..... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
------------------------------------------------------------
Net investment income .................... 0.030 0.026 0.030 0.029 0.032
------------------------------------------------------------
Dividends from net investment income ..... (0.030) (0.026) (0.030) (0.029) (0.032)
------------------------------------------------------------
Net asset value at end of year ........... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
============================================================
Total return ............................. 3.05% 2.68% 3.03% 2.90% 3.29%
============================================================
Net assets at end of year (000's) ........ $ 18,244 $ 21,371 $ 14,368 $ 22,434 $ 28,906
============================================================
Ratio of net expenses to
average net assets(A) .................. 0.73% 0.75% 0.75% 0.75% 0.61%
Ratio of net investment income to
average net assets ..................... 2.98% 2.58% 2.98% 2.85% 3.24%
</TABLE>
(A) Absent fee waivers and/or expense reimbursements by the Adviser, the ratio
of expenses to average net assets would have been 1.00%, 0.98%, 0.95%,
0.94% and 0.80% for the years ended June 30, 2000, 1999, 1998, 1997 and
1996, respectively (Note 4).
See accompanying notes to financial statements.
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<PAGE>
<TABLE>
<CAPTION>
TAX-FREE INTERMEDIATE TERM FUND - CLASS A
FINANCIAL HIGHLIGHTS
==========================================================================================================
Per Share Data for a Share Outstanding Throughout Each Year
----------------------------------------------------------------------------------------------------------
Year Ended June 30,
------------------------------------------------------------
2000 1999 1998 1997 1996
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of year ..... $ 10.87 $ 11.12 $ 11.01 $ 10.85 $ 10.86
------------------------------------------------------------
Income from investment operations:
Net investment income .................. 0.48 0.48 0.50 0.50 0.50
Net realized and unrealized gains (losses)
on investments ....................... (0.19) (0.25) 0.11 0.16 (0.01)
------------------------------------------------------------
Total from investment operations ......... 0.29 0.23 0.61 0.66 0.49
------------------------------------------------------------
Dividends from net investment income ..... (0.48) (0.48) (0.50) (0.50) (0.50)
------------------------------------------------------------
Net asset value at end of year ........... $ 10.68 $ 10.87 $ 11.12 $ 11.01 $ 10.85
============================================================
Total return(A) .......................... 2.75% 2.07% 5.63% 6.19% 4.51%
============================================================
Net assets at end of year (000's) ........ $ 36,817 $ 47,899 $ 52,896 $ 58,485 $ 67,675
============================================================
Ratio of net expenses to average net assets 0.99%(B) 0.99% 0.99% 0.99% 0.99%
Ratio of net investment income to
average net assets ..................... 4.47% 4.33% 4.50% 4.55% 4.52%
Portfolio turnover rate .................. 41% 51% 36% 30% 37%
</TABLE>
(A) Total returns shown exclude the effect of applicable sales loads.
(B) Absent fee waivers and/or expense reimbursements by the Adviser, the ratio
of expenses to average net assets would have been 1.00% for the year ended
June 30, 2000.
See accompanying notes to financial statements.
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----
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<PAGE>
<TABLE>
<CAPTION>
TAX-FREE INTERMEDIATE TERM FUND - CLASS C
FINANCIAL HIGHLIGHTS
==========================================================================================================
Per Share Data for a Share Outstanding Throughout Each Year
----------------------------------------------------------------------------------------------------------
Year Ended June 30,
------------------------------------------------------------
2000 1999 1998 1997 1996
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of year ..... $ 10.88 $ 11.12 $ 11.01 $ 10.85 $ 10.86
------------------------------------------------------------
Income from investment operations:
Net investment income .................. 0.40 0.40 0.42 0.43 0.44
Net realized and unrealized gains (losses)
on investments ....................... (0.20) (0.24) 0.11 0.16 (0.01)
------------------------------------------------------------
Total from investment operations ......... 0.20 0.16 0.53 0.59 0.43
------------------------------------------------------------
Dividends from net investment income ..... (0.40) (0.40) (0.42) (0.43) (0.44)
------------------------------------------------------------
Net asset value at end of year ........... $ 10.68 $ 10.88 $ 11.12 $ 11.01 $ 10.85
============================================================
Total return(A) .......................... 1.88% 1.40% 4.85% 5.49% 4.00%
============================================================
Net assets at end of year (000's) ........ $ 3,374 $ 4,634 $ 4,747 $ 5,161 $ 5,239
============================================================
Ratio of net expenses to average net assets 1.74%(B) 1.74% 1.74% 1.65% 1.49%
Ratio of net investment income to
average net assets ..................... 3.72% 3.58% 3.75% 3.89% 4.02%
Portfolio turnover rate .................. 41% 51% 36% 30% 37%
</TABLE>
(A) Total returns shown exclude the effect of applicable sales loads.
(B) Absent fee waivers and/or expense reimbursements by the Adviser, the ratio
of expenses to average net assets would have been 1.76% for the year ended
June 30, 2000.
See accompanying notes to financial statements.
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<PAGE>
<TABLE>
<CAPTION>
OHIO INSURED TAX-FREE FUND - CLASS A
FINANCIAL HIGHLIGHTS
==========================================================================================================
Per Share Data for a Share Outstanding Throughout Each Year
----------------------------------------------------------------------------------------------------------
Year Ended June 30,
------------------------------------------------------------
2000 1999 1998 1997 1996
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of year ..... $ 11.74 $ 12.37 $ 12.22 $ 11.97 $ 11.99
------------------------------------------------------------
Income from investment operations:
Net investment income .................. 0.58 0.58 0.61 0.61 0.62
Net realized and unrealized gains (losses)
on investments ....................... (0.29) (0.34) 0.23 0.25 (0.02)
------------------------------------------------------------
Total from investment operations ......... 0.29 0.24 0.84 0.86 0.60
------------------------------------------------------------
Less distributions:
Dividends from net investment income ... (0.58) (0.58) (0.61) (0.61) (0.62)
Distributions from net realized gains .. -- (0.29) (0.08) -- --
------------------------------------------------------------
Total distributions ...................... (0.58) (0.87) (0.69) (0.61) (0.62)
------------------------------------------------------------
Net asset value at end of year ........... $ 11.45 $ 11.74 $ 12.37 $ 12.22 $ 11.97
============================================================
Total return(A) .......................... 2.60% 1.81% 7.03% 7.36% 5.05%
============================================================
Net assets at end of year (000's) ........ $ 59,600 $ 62,737 $ 69,289 $ 70,816 $ 75,938
============================================================
Ratio of net expenses to
average net assets ..................... 0.75%(B) 0.75% 0.75% 0.75% 0.75%
Ratio of net investment income to
average net assets ..................... 5.08% 4.72% 4.95% 5.05% 5.12%
Portfolio turnover rate .................. 66% 26% 41% 33% 46%
</TABLE>
(A) Total returns shown exclude the effect of applicable sales loads.
(B) Absent fee waivers and/or expense reimbursements by the Adviser, the ratio
of expenses to average net assets would have been 0.77% for the year ended
June 30, 2000.
See accompanying notes to financial statements.
TOUCHSTONE FAMILY OF FUNDS
----
21
----
<PAGE>
<TABLE>
<CAPTION>
OHIO INSURED TAX-FREE FUND - CLASS C
FINANCIAL HIGHLIGHTS
==========================================================================================================
Per Share Data for a Share Outstanding Throughout Each Year
----------------------------------------------------------------------------------------------------------
Year Ended June 30,
------------------------------------------------------------
2000 1999 1998 1997 1996
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of year ..... $ 11.74 $ 12.37 $ 12.22 $ 11.97 $ 12.00
------------------------------------------------------------
Income from investment operations:
Net investment income .................. 0.49 0.49 0.52 0.53 0.56
Net realized and unrealized gains
(losses) on investments .............. (0.30) (0.34) 0.23 0.25 (0.03)
------------------------------------------------------------
Total from investment operations ......... 0.19 0.15 0.75 0.78 0.53
------------------------------------------------------------
Less distributions:
Dividends from net investment income ... (0.49) (0.49) (0.52) (0.53) (0.56)
Distributions from net realized gains .. -- (0.29) (0.08) -- --
------------------------------------------------------------
Total distributions ...................... (0.49) (0.78) (0.60) (0.53) (0.56)
------------------------------------------------------------
Net asset value at end of year ........... $ 11.44 $ 11.74 $ 12.37 $ 12.22 $ 11.97
============================================================
Total return(A) .......................... 1.75% 1.05% 6.24% 6.65% 4.44%
============================================================
Net assets at end of year (000's) ........ $ 3,585 $ 4,740 $ 5,215 $ 4,639 $ 3,972
============================================================
Ratio of net expenses to
average net assets(B) .................. 1.50% 1.50% 1.50% 1.42% 1.25%
Ratio of net investment income to
average net assets ..................... 4.42% 3.97% 4.20% 4.37% 4.62%
Portfolio turnover rate .................. 66% 26% 41% 33% 46%
</TABLE>
(A) Total returns shown exclude the effect of applicable sales loads.
(B) Absent fee waivers and/or expense reimbursements by the Adviser, the ratio
of expenses to average net assets would have been 1.56% for the year ended
June 30, 2000.
(C) Annualized.
See accompanying notes to financial statements.
TOUCHSTONE FAMILY OF FUNDS
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<PAGE>
NOTES TO FINANCIAL STATEMENTS
June 30, 2000
================================================================================
1. ORGANIZATION
The Tax-Free Money Fund, the California Tax-Free Money Fund, the Ohio Tax-Free
Money Fund, the Florida Tax-Free Money Fund, the Tax-Free Intermediate Term Fund
and the Ohio Insured Tax-Free Fund (collectively, the Funds) are each a separate
series of shares of Touchstone Tax-Free Trust (the Trust). The Trust is
registered under the Investment Company Act of 1940 (the 1940 Act) as an
open-end management investment company. The Trust was established as a
Massachusetts business trust under a Declaration of Trust dated April 13, 1981.
The Declaration of Trust, as amended, permits the Trustees to issue an unlimited
number of shares of each Fund.
The Tax-Free Money Fund seeks the highest level of interest income exempt from
federal income tax, consistent with the protection of capital, by investing
primarily in high-quality, short-term municipal obligations.
The California Tax-Free Money Fund seeks the highest level of current income
exempt from federal and California income taxes, consistent with liquidity and
stability of principal, by investing primarily in high-quality, short-term
California municipal obligations.
The Ohio Tax-Free Money Fund seeks the highest level of current income exempt
from federal income tax and Ohio personal income tax, consistent with liquidity
and stability of principal. The Fund invests primarily in a portfolio of
high-quality, short-term Ohio municipal obligations.
The Florida Tax-Free Money Fund seeks the highest level of interest income
exempt from federal income tax, consistent with liquidity and stability of
principal, by investing primarily in high-quality, short-term Florida municipal
obligations the value of which is exempt from the Florida intangible personal
property tax.
The Tax-Free Intermediate Term Fund seeks high current income exempt from
federal income tax, consistent with the protection of capital, by investing
primarily in high-grade municipal obligations maturing within twenty years or
less with a dollar-weighted average portfolio maturity under normal market
conditions of between three and ten years. To the extent consistent with the
Fund's primary objective, capital appreciation is a secondary objective.
The Ohio Insured Tax-Free Fund seeks the highest level of interest income exempt
from federal income tax and Ohio personal income tax, consistent with the
protection of capital. The Fund invests primarily in high quality, long-term
Ohio municipal obligations which are protected by insurance guaranteeing the
payment of principal and interest in the event of a default.
The Ohio Tax-Free Money Fund offers two classes of shares: Retail shares (sold
subject to a distribution fee of up to 0.25% of average daily net assets of the
Fund) and Institutional shares (sold without a distribution fee). Each Retail
and Institutional share of the Fund represents identical interests in the Fund's
investment portfolio and has the same rights, except that (i) Retail shares bear
the expenses of distribution fees, which will cause Retail shares to have a
higher expense ratio and to pay lower dividends than those related to
Institutional shares; (ii) certain other class specific expenses will be borne
solely by the class to which such expenses are attributable; (iii) each class
has exclusive voting rights with respect to matters affecting only that class;
and (iv) Retail shares are subject to a lower minimum initial investment
requirement and offer certain shareholder services not available to
Institutional shares such as checkwriting and automatic investment and
redemption plans.
TOUCHSTONE FAMILY OF FUNDS
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<PAGE>
NOTES TO FINANCIAL STATEMENTS
(Continued)
================================================================================
The Tax-Free Intermediate Term Fund and the Ohio Insured Tax-Free Fund each
offer two classes of shares: Class A shares (sold subject to a maximum front-end
sales load of 4.75% and a distribution fee of up to 0.25% of average daily net
assets of each Fund) and Class C shares (sold subject to a maximum contingent
deferred sales load of 1.25% for a one-year period and a distribution fee of up
to 1% of average daily net assets of each Fund). Each Class A and Class C share
of the Fund represents identical interests in the Fund's investment portfolio
and has the same rights, except that (i) Class C shares bear the expenses of
higher distribution fees, which will cause Class C shares to have a higher
expense ratio and to pay lower dividends than those related to Class A shares;
(ii) certain other class specific expenses will be borne solely by the class to
which such expenses are attributable; and (iii) each class has exclusive voting
rights with respect to matters relating to its own distribution arrangements
(Note 7).
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of the Trust's significant accounting policies:
Security valuation -- Tax-Free Money Fund, California Tax-Free Money Fund, Ohio
Tax-Free Money Fund and Florida Tax-Free Money Fund securities are valued on an
amortized cost basis, which approximates market. This involves initially valuing
a security at its original cost and thereafter assuming a constant amortization
to maturity of any discount or premium. This method of valuation is expected to
enable these Funds to maintain a constant net asset value per share. Tax-Free
Intermediate Term Fund and Ohio Insured Tax-Free Fund securities are valued at
market using an independent pricing service which generally utilizes a
computerized grid matrix of tax-exempt securities and evaluations by its staff
to determine what it believes is the fair value of the securities. On limited
occasions, if the valuation provided by the pricing service ignores certain
market conditions affecting the value of a security or the pricing service
cannot provide a valuation, the fair value of the security will be determined in
good faith consistent with procedures established by the Board of Trustees.
Share valuation -- The net asset value per share of the Tax-Free Money Fund, the
California Tax-Free Money Fund and the Florida Tax-Free Money Fund is calculated
daily by dividing the total value of a Fund's assets, less liabilities, by its
number of shares outstanding. The net asset value per share of each class of
shares of the Ohio Tax-Free Money Fund, the Tax-Free Intermediate Term Fund and
the Ohio Insured Tax-Free Fund is also calculated daily by dividing the total
value of a Fund's assets attributable to that class, less liabilities
attributable to that class, by the number of shares of that class outstanding.
The offering price per share of the Tax-Free Money Fund, the California Tax-Free
Money Fund, the Ohio Tax-Free Money Fund and the Florida Tax-Free Money Fund is
equal to the net asset value per share. The maximum offering price of Class A
shares of the Tax-Free Intermediate Term Fund and the Ohio Insured Tax-Free Fund
is equal to the net asset value per share plus a sales load equal to 4.99% of
the net asset value (or 4.75% of the offering price). The offering price of
Class C shares of each Fund is equal to the net asset value per share plus a
sales load equal to 1.27% of the net asset value (or 1.25% of the offering
price) (Note 7).
TOUCHSTONE FAMILY OF FUNDS
----
24
----
<PAGE>
NOTES TO FINANCIAL STATEMENTS
(Continued)
================================================================================
The redemption price per share of each Fund, including each class of shares with
respect to the Ohio Tax-Free Money Fund, the Tax-Free Intermediate Term Fund and
the Ohio Insured Tax-Free Fund, is equal to the net asset value per share.
However, Class C shares of the Tax-Free Intermediate Term Fund and the Ohio
Insured Tax-Free Fund are subject to a contingent deferred sales load of 1% of
the original purchase price if redeemed within a one-year period from the date
of purchase.
Investment income -- Interest income is accrued as earned. Discounts and
premiums on securities purchased are amortized in accordance with income tax
regulations which approximate generally accepted accounting principles.
Distributions to shareholders -- Dividends from net investment income are
declared daily and paid on the last business day of each month. Net realized
short-term capital gains, if any, may be distributed throughout the year and net
realized long-term capital gains, if any, are distributed at least once each
year. Income distributions and capital gain distributions are determined in
accordance with income tax regulations.
Security transactions -- Security transactions are accounted for on the trade
date. Securities sold are determined on a specific identification basis.
When-issued securities -- The Funds may purchase securities with delivery or
payments to occur at a later date. At the time the Funds enter into a commitment
to purchase a security, the transaction is recorded and the value of the
security is reflected in the net asset value. The value of the security may vary
with market fluctuations. No interest accrues to the Fund until payment takes
place. At the time the Fund enters into this type of transaction, it is required
to segregate cash or other liquid assets equal to the value of the securities
purchased. At June 30, 2000, the market value of securities segregated for these
types of transactions for the Tax-Free Intermediate Term Fund was $1,005,690 and
$1,050,680 for the Ohio Insured Tax-Free Fund.
Allocations between classes -- Investment income earned by the Ohio Tax-Free
Money Fund, the Tax-Free Intermediate Term Fund and the Ohio Insured Tax-Free
Fund is allocated daily to each class of shares based on the percentage of the
net asset value of settled shares of such class to the total of the net asset
value of settled shares of both classes. Realized capital gains and losses and
unrealized appreciation and depreciation are allocated daily to each class of
shares based upon its proportionate share of total net assets of the Fund. Class
specific expenses are charged directly to the class incurring the expense.
Common expenses which are not attributable to a specific class are allocated
daily to each class of shares based upon its proportionate share of total net
assets of the Fund.
Estimates -- The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities at
the date of the financial statements and the reported amounts of income and
expenses during the reporting period. Actual results could differ from those
estimates.
Federal income tax -- It is each Fund's policy to comply with the special
provisions of the Internal Revenue Code available to regulated investment
companies. As provided therein, in any fiscal year in which a Fund so qualifies
and distributes at least 90% of its net income, the Fund will be relieved of
federal income tax on the income distributed. Accordingly, no provision for
income taxes has been made. In addition, each Fund intends to satisfy conditions
which enable it to designate the interest income generated by its investment in
municipal securities, which is exempt from federal income tax when received by
the Fund, as exempt-interest dividends upon distribution to shareholders.
TOUCHSTONE FAMILY OF FUNDS
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25
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<PAGE>
NOTES TO FINANCIAL STATEMENTS
(Continued)
================================================================================
In order to avoid imposition of the excise tax applicable to regulated
investment companies, it is also each Fund's intention to declare as dividends
in each calendar year at least 98% of its net investment income (earned during
the calendar year) and 98% of its net realized capital gains (earned during the
twelve months ended October 31) plus undistributed amounts from prior years.
The following information is based upon the federal income tax cost of portfolio
investments as of June 30, 2000:
--------------------------------------------------------------------------------
TAX-FREE OHIO INSURED
INTERMEDIATE TAX-FREE
(000'S) TERM FUND FUND
--------------------------------------------------------------------------------
Gross unrealized appreciation .................... $ 594 $1,581
Gross unrealized depreciation .................... (424) (358)
-----------------------
Net unrealized appreciation ...................... $ 170 $1,223
=======================
--------------------------------------------------------------------------------
The tax basis of portfolio investments for each Fund is equal to the amortized
cost as shown on the Statements of Assets and Liabilities.
As of June 30, 2000, the Funds had the following capital loss carryforwards for
federal income tax purposes. These capital loss carryforwards may be utilized in
future years to offset net realized capital gains prior to distribution to
shareholders.
--------------------------------------------------------------------------------
EXPIRES
FUND AMOUNT JUNE 30
--------------------------------------------------------------------------------
Tax-Free Money Fund .............................. $ 409 2003
564 2004
2,865 2008
California Tax-Free Money Fund ................... $ 447 2007
Ohio Tax-Free Money Fund ......................... $ 90 2004
2,952 2008
Florida Tax-Free Money Fund ...................... $ 4,527 2007
6,777 2008
Tax-Free Intermediate Term Fund .................. $313,244 2004
Ohio Insured Tax-Free Fund ....................... $ 35,418 2008
--------------------------------------------------------------------------------
3. INVESTMENT TRANSACTIONS
Investment transactions (excluding short-term investments) were as follows for
the year ended June 30, 2000:
--------------------------------------------------------------------------------
TAX-FREE OHIO INSURED
INTERMEDIATE TAX-FREE
(000'S) TERM FUND FUND
--------------------------------------------------------------------------------
Purchases of investment securities ............... $18,236 $41,760
Proceeds from sales and maturities of
investment securities .......................... $28,705 $39,561
--------------------------------------------------------------------------------
TOUCHSTONE FAMILY OF FUNDS
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26
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<PAGE>
NOTES TO FINANCIAL STATEMENTS
(Continued)
================================================================================
4. TRANSACTIONS WITH AFFILIATES
The President and certain other officers of the Trust are also officers of
Touchstone Advisers, Inc. (the Adviser), the Trust's investment adviser,
Touchstone Securities, Inc. (the Underwriter), the Trust's principal
underwriter, and Integrated Fund Services, Inc. (IFS), the Trust's transfer
agent, shareholder service agent and accounting services agent. The Adviser, the
Underwriter and IFS are each wholly-owned indirect subsidiaries of the Western
and Southern Life Insurance Companies.
MANAGEMENT AGREEMENT
Each Fund's investments are managed by the Adviser under the terms of a
Management Agreement. Under the Management Agreement, each Fund pays the Adviser
a fee, computed and accrued daily and paid monthly, at an annual rate of 0.5% of
its respective average daily net assets up to $100 million, 0.45% of such net
assets from $100 million to $200 million, 0.4% of such net assets from $200
million to $300 million and 0.375% of such net assets in excess of $300 million.
In order to voluntarily reduce operating expenses during the year ended June 30,
2000, the Adviser waived investment advisory fees of $27,592 for the Tax-Free
Money Fund, $80,268 for the Ohio Tax-Free Money Fund, $5,375 for the Tax-Free
Intermediate Fund and $13,994 for the Ohio Insured Tax-Free Fund. The Adviser
waived $65,561 of investment advisory fees and $16,937 of other operating
expenses for the Florida Tax-Free Money Fund for the year ended June 30, 2000.
TRANSFER AGENT AGREEMENT
Under the terms of the Transfer, Dividend Disbursing, Shareholder Service and
Plan Agency Agreement between the Trust and IFS, IFS maintains the records for
each shareholder's account, answers shareholders' inquiries concerning their
accounts, processes purchases and redemptions of each Fund's shares, acts as
dividend and distribution disbursing agent and performs other shareholder
service functions. For these services, IFS receives a monthly fee at an annual
rate of $25 per shareholder account from each of the Tax-Free Money Fund, the
California Tax-Free Money Fund, the Ohio Tax-Free Money Fund and the Florida
Tax-Free Money Fund and $21 per shareholder account from each of the Tax-Free
Intermediate Term Fund and the Ohio Insured Tax-Free Fund, subject to a $1,000
minimum monthly fee for each Fund, or for each class of shares of a Fund, as
applicable. In addition, each Fund pays IFS out-of-pocket expenses including,
but not limited to, postage and supplies.
ACCOUNTING SERVICES AGREEMENT
Under the terms of the Accounting Services Agreement between the Trust and IFS,
IFS calculates the daily net asset value per share and maintains the financial
books and records of each Fund. For these services, IFS receives a monthly fee,
based on current net assets, of $2,500 per month from the Tax-Free Money Fund,
$3,000 per month from the California Tax-Free Money Fund, $6,000 per month from
the Ohio Tax-Free Money Fund, $3,500 per month from the Florida Tax-Free Money
Fund, and $4,000 per month from each of the Tax-Free Intermediate Term Fund and
the Ohio Insured Tax-Free Fund. In addition, each Fund is subject to an
additional charge of 0.001% of its respective average daily net assets in excess
of $300 million, and each Fund pays certain out-of-pocket expenses incurred by
IFS in obtaining valuations of such Fund's portfolio securities.
TOUCHSTONE FAMILY OF FUNDS
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<PAGE>
NOTES TO FINANCIAL STATEMENTS
(Continued)
================================================================================
UNDERWRITING AGREEMENT
The Underwriter is the Funds' principal underwriter and, as such, acts as
exclusive agent for distribution of the Funds' shares. Under the terms of the
Underwriting Agreement between the Trust and the Underwriter, the Underwriter
earned $2,231 and $4,477 from underwriting and broker commissions on the sale of
shares of the Tax-Free Intermediate Term Fund and the Ohio Insured Tax-Free
Fund, respectively, during the year ended June 30, 2000. In addition, the
Underwriter collected $4,443 and $565 of contingent deferred sales loads on the
redemption of Class C shares of the Tax-Free Intermediate Term Fund and the Ohio
Insured Tax-Free Fund, respectively.
PLANS OF DISTRIBUTION
The Trust has a Plan of Distribution (Class A Plan) under which shares of each
Fund having one class of shares and Class A shares of each Fund having two
classes of shares may directly incur or reimburse the Adviser or the Underwriter
for expenses related to the distribution and promotion of shares. The annual
limitation for payment of such expenses under the Class A Plan is 0.25% of
average daily net assets attributable to such shares.
The Trust also has a Plan of Distribution (Class C Plan) under which Class C
shares of the Tax-Free Intermediate Term Fund and the Ohio Insured Tax-Free Fund
may directly incur or reimburse the Adviser for expenses related to the
distribution and promotion of shares. The annual limitation for payment of such
expenses under the Class C Plan is 1% of average daily net assets attributable
to Class C shares.
CUSTODIAN AGREEMENTS
The Fifth Third Bank, which serves as the custodian for each Fund except for the
Florida Tax-Free Money Fund, was a significant shareholder of record of the Ohio
Tax-Free Money Fund as of June 30, 2000. Under the terms of its Custodian
Agreement, The Fifth Third Bank receives from each such Fund an asset-based fee
plus transaction charges for each security transaction entered into by the
Funds. Huntington National Bank, N.A. (Huntington), which serves as the
custodian for the Florida Tax-Free Money Fund, was a significant shareholder of
record of such Fund as of June 30, 2000. Under the terms of its Custodian
Agreement, Huntington receives from the Fund an asset-based fee.
TOUCHSTONE FAMILY OF FUNDS
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<PAGE>
NOTES TO FINANCIAL STATEMENTS
(Continued)
================================================================================
5. CAPITAL SHARE TRANSACTIONS
Capital share transactions for the Tax-Free Money Fund, the California Tax-Free
Money Fund, the Ohio Tax-Free Money Fund and the Florida Tax-Free Money Fund are
identical to the dollar value of those transactions as shown in the Statements
of Changes in Net Assets. Proceeds and payments on capital shares as shown in
the Statements of Changes in Net Assets for the Tax-Free Intermediate Term Fund
and the Ohio Insured Tax-Free Fund are the result of the following capital share
transactions:
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------
TAX-FREE INTERMEDIATE OHIO INSURED
TERM FUND TAX-FREE FUND
---------------------------------------------------------------------------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
(000'S) 2000 1999 2000 1999
---------------------------------------------------------------------------------------------
CLASS A
<S> <C> <C> <C> <C>
Shares sold ................................ 1,024 1,222 5,795 11,637
Shares reinvested .......................... 145 154 185 287
Shares redeemed ............................ (2,128) (1,729) (6,116) (12,181)
-------------------------------------------
Net decrease in shares outstanding ......... (959) (353) (136) (257)
Shares outstanding, beginning of year ...... 4,405 4,758 5,343 5,600
-------------------------------------------
Shares outstanding, end of year ............ 3,446 4,405 5,207 5,343
===========================================
CLASS C
Shares sold ................................ 84 219 12 45
Shares reinvested .......................... 12 14 13 22
Shares redeemed ............................ (206) (234) (116) (85)
-------------------------------------------
Net decrease in shares outstanding ......... (110) (1) (91) (18)
Shares outstanding, beginning of year ...... 426 427 404 422
-------------------------------------------
Shares outstanding, end of year ............ 316 426 313 404
===========================================
---------------------------------------------------------------------------------------------
</TABLE>
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29
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<PAGE>
NOTES TO FINANCIAL STATEMENTS
(Continued)
================================================================================
6. PORTFOLIO COMPOSITION
As of June 30, 2000, the Ohio Tax-Free Money Fund and the Ohio Insured Tax-Free
Fund were invested exclusively in debt obligations issued by the State of Ohio
and its political subdivisions, agencies, authorities and instrumentalities and
by other issuers the interest from which is exempt from Ohio personal income
tax. The California Tax-Free Money Fund was invested exclusively in debt
obligations issued by the State of California and its political subdivisions,
agencies, authorities and instrumentalities and by other issuers the interest
from which is exempt from California income tax. The Florida Tax-Free Money Fund
was 94.0% invested in debt obligations issued by the State of Florida and its
political subdivisions, agencies, authorities and instrumentalities and by other
issuers the value of which is exempt from the Florida intangible personal
property tax. As of June 30, 2000, 26.6% of the portfolio securities of the
Tax-Free Money Fund were concentrated in the State of Ohio, and 13.3% in the
State of Illinois. For information regarding portfolio composition by state for
the Tax-Free Intermediate Term Fund, see the Fund's Portfolio of Investments.
The California Tax-Free Money Fund, the Ohio Tax-Free Money Fund, the Florida
Tax-Free Money Fund and the Ohio Insured Tax-Free Fund are each non-diversified
Funds under the 1940 Act. Thus, investments may be concentrated in fewer issuers
than those of a diversified fund. As of June 30, 2000, no non-diversified Fund
had concentrations of investments (10% or greater) in any one issuer.
The Tax-Free Money Fund, the California Tax-Free Money Fund, the Ohio Tax-Free
Money Fund and the Florida Tax-Free Money Fund each invest in municipal
securities maturing in 13 months or less and having a short-term rating in one
of the top two ratings categories by at least two nationally recognized
statistical rating agencies (or by one such agency if a security is rated by
only that agency) or, if unrated, are determined by the Adviser, under the
supervision of the Board of Trustees, to be of comparable quality.
As of June 30, 2000, 43.4% of the Tax-Free Intermediate Term Fund's portfolio
securities were rated AAA/Aaa [using the higher of Standard & Poor's Corporation
(S&P) or Moody's Investors Service, Inc. (Moody's) ratings], 28.5% were rated
AA/Aa, 26.3% were rated A/A and 1.5% were not rated.
As of June 30, 2000, 73.9% of the Ohio Insured Tax-Free Fund's long-term
portfolio securities were either (1) insured by an insurance policy obtained
from a recognized insurer which carries a rating of AAA by S&P or Aaa by
Moody's, (2) guaranteed as to the payment of interest and principal by an agency
or instrumentality of the U.S. Government or (3) secured as to the payment of
interest and principal by an escrow account consisting of obligations of the
U.S. Government. Three private insurers individually insure more than 10% of the
Ohio Insured Tax-Free Fund's portfolio securities and collectively insure 60.2%
of its portfolio securities.
TOUCHSTONE FAMILY OF FUNDS
----
30
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<PAGE>
NOTES TO FINANCIAL STATEMENTS
(Continued)
================================================================================
The concentration of investments for each Fund as of June 30, 2000, classified
by revenue source, was as follows:
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------
CALIFORNIA OHIO FLORIDA TAX-FREE OHIO
TAX-FREE TAX-FREE TAX-FREE TAX-FREE INTERMEDIATE INSURED
MONEY MONEY MONEY MONEY TERM TAX-FREE
FUND FUND FUND FUND FUND FUND
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
General Obligations ............................ 6.8% 7.7% 16.4% 0.5% 16.3% 49.7%
Revenue Bonds:
Industrial Development/Pollution Control 45.5% 20.8% 17.9% 4.6% 6.8% --
Hospital/Health Care ................... 7.1% 17.6% 21.0% 22.4% 20.2% 14.5%
Utilities .............................. 7.4% 16.1% 19.9% 15.5% 10.1% 10.1%
Bank & Financial ....................... -- -- 1.4% 2.8% -- --
Education .............................. 6.5% 5.6% 8.0% 8.3% 16.5% 11.2%
Housing/Mortgage ....................... 2.0% 4.7% 4.4% 19.1% 11.9% 5.3%
Economic Development ................... 18.8% 16.5% 7.0% 7.3% 2.6% 1.6%
Public Facilities ...................... 2.6% 0.2% 1.9% 5.0% 7.3% 2.6%
Transportation ......................... -- 0.5% 0.3% 0.6% 4.4% 3.0%
Special Tax ............................ -- 0.6% 0.3% 0.6% 2.6% --
Leases ................................. -- 2.6% -- -- -- --
Miscellaneous .......................... 3.4% 7.1% 1.6% 13.3% 1.3% 2.1%
-------------------------------------------------------------
Total .......................................... 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
=============================================================
</TABLE>
7. MAXIMUM OFFERING PRICE PER SHARE
Effective August 1, 1999, for accounts opened after July 31, 1999, the maximum
offering price per share of Class A shares of the Tax-Free Intermediate Term
Fund and the Ohio Insured Tax-Free Fund is equal to the net asset value per
share plus a sales load equal to 4.99% of the net asset value (or 4.75% of the
offering price). Effective August 1, 1999, for all accounts, the maximum
offering price per share of Class C shares of each Fund is equal to the net
asset value per share plus a sales load equal to 1.27% of the net asset value
(or 1.25% of the offering price).
8. FEDERAL TAX INFORMATION FOR SHAREHOLDERS (UNAUDITED)
In accordance with federal tax requirements, each Fund designates its respective
dividends paid from net investment income during the year ended June 30, 2000,
as "exempt-interest dividends." Ninety-nine percent of the interest income
earned by the California Tax-Free Money Fund was derived from securities issued
in the state of California.
9. FLORIDA TAX-FREE MONEY FUND - INSTITUTIONAL
Effective April 28, 2000, the Florida Tax-Free Money Fund - Institutional Class
closed and the shares were moved into the Retail Class.
10. NAME CHANGE
Effective May 1, 2000, the Countrywide Tax-Free Trust changed its name to
Touchstone Tax-Free Trust. Countrywide Fund Services, Inc. changed its name to
Integrated Fund Services, Inc. Touchstone Advisors, Inc., upon shareholder
approval, became the new advisor for the Funds in the Trust. Fort Washington
Investment Advisors, Inc., upon shareholder approval, became the sub-advisor for
the Funds in the Trust. Touchstone Securities, Inc., became the
underwriter/distributor for the Funds in the Trust.
TOUCHSTONE FAMILY OF FUNDS
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31
----
<PAGE>
<TABLE>
<CAPTION>
TAX-FREE MONEY FUND
PORTFOLIO OF INVESTMENTS
JUNE 30, 2000
==============================================================================================================================
PRINCIPAL MARKET
AMOUNT FIXED RATE REVENUE & COUPON MATURITY VALUE
(000'S) GENERAL OBLIGATION BONDS-- 21.7% RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
$ 100 Brownsburg, IN, Multi-School Bldg. Corp. Rev ............................... 9.750 07/01/00 $ 100
100 Washington St. Public Power Supply Sys. Rev.,
Ser. C (Nuclear Proj. No. 1), Prerefunded @ 102 .......................... 8.000 07/01/00 102
155 Aransas Pass, TX, GO ....................................................... 4.200 08/01/00 155
200 Floresville, TX, Electric Light and Power Sys. Rev ......................... 5.570 08/15/00 200
250 American Municipal Power Sys. Impt. BANS (City Of Bryan Proj.) ............. 4.750 08/25/00 250
200 Johnson Co., KS, USD No. 233 GO ............................................ 5.500 09/01/00 201
660 Westminster CO, COP ........................................................ 3.800 09/01/00 660
100 Ohio St. Bldg. Auth. Rev. St. Fac. (Das Data Center Proj.) ................. 4.000 10/01/00 100
400 New Knoxville, OH, Waterworks Sys. BANS .................................... 4.250 10/05/00 400
450 Crestline Village, OH, Swimming Pool Impt. BANS ............................ 4.470 11/16/00 451
100 Westmoreland Co., PA, Municipal Auth. Serv. Rev.,
Ser. M, Prerefunded @ 100 ................................................ 7.250 12/01/00 100
520 American Municipal Power Sys. Impt. BANS (Wellington Village Proj.) ........ 4.300 12/15/00 520
501 American Municipal Power Sys. Impt. BANS (Milan Village Proj.) ............. 4.450 01/19/01 501
500 American Municipal Power Sys.Equipment BANS
(Distributive Generation Proj.) .......................................... 5.250 01/19/01 498
185 College Station, TX, Utility System Rev .................................... 5.875 02/01/01 186
105 San Antonio, TX, Electric & Gas Rev ........................................ 5.200 02/01/01 105
200 Webb Co., TX, COP .......................................................... 4.550 02/01/01 200
300 Richardson, TX, ISD, GO .................................................... 4.750 02/15/01 300
430 American Municipal Power Sys. Impt. BANS (Bradner Village Proj.) ........... 4.900 03/23/01 430
---------- ----------
$ 5,456 TOTAL FIXED RATE REVENUE & GENERAL OBLIGATION BONDS
---------- (Amortized Cost $5,459) .................................................... $ 5,459
----------
TOUCHSTONE FAMILY OF FUNDS
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32
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<PAGE>
TAX-FREE MONEY FUND (CONTINUED)
==============================================================================================================================
PRINCIPAL MARKET
AMOUNT COUPON MATURITY VALUE
(000'S) FLOATING & VARIABLE DEMAND NOTES-- 51.7% RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
$ 500 Arapahoe Co., CO, IDR (Denver JetCenter Proj.) ............................. 4.550 07/01/00 $ 500
200 Illinois Health Fac. Auth. Rev., Ser. B (Elmhurst Memorial Hosp.) .......... 4.700 07/01/00 200
1,100 Puerto Rico Commonwealth Trans, Ser. A-1 ................................... 4.750 07/01/00 1,100
1,000 University Athletic Association, FL, Capital Impt. Rev
(Univ. of Florida Stadium Proj.) ......................................... 4.750 07/01/00 1,000
900 Eddyville, IA, IDR (Heartland Lysine, Inc.) ................................ 5.350 07/05/00 900
700 San Rafael, CA, IDR Bonds (Phoenix American Inc.) .......................... 5.000 07/05/00 700
1,100 Scio Twnp., MI, EDR ........................................................ 4.900 07/05/00 1,100
505 Brooklyn Park, MN, IDR (Schmidt Proj.) ..................................... 5.050 07/06/00 505
475 Frankfort, MN, IDR, Ser. 1995 (J&B, Inc.) .................................. 5.050 07/06/00 475
245 Frankfort, MN, IDR, Ser. 1995 (J&B, Inc.) .................................. 5.300 07/06/00 245
649 Franklin Park, IL, Rev., Ser. 1994 (A.M. Castle & Co. Proj.) ............... 5.150 07/06/00 649
1,395 Harvard, IL, Health Care Fac. Rev., Ser. 1998
(Harvard Memorial Hosp. Proj.) ........................................... 4.950 07/06/00 1,395
200 Hope, AR, IDR, Ser. A (Champion Parts, Inc. Proj.) ......................... 5.150 07/06/00 200
973 Kansas City, MO, IDR (A.M. Castle & Co. Proj.) ............................. 5.150 07/06/00 973
1,235 Mankato, MN, IDR, Ser. 1998 (Sacco Family LP Proj.) ........................ 5.200 07/06/00 1,235
1,000 Payne Co., OK, EDR, Ser. A (Collegiate Hsg. Foundation) .................... 4.750 07/06/00 1,000
188 Rosemont, IL. IDR, (A.M. Castle & Co. Proj.) ............................... 5.150 07/06/00 188
660 Wakarusa, IN, EDR (MMM-Invest Inc. Proj.) .................................. 5.000 07/06/00 660
---------- ----------
$ 13,025 TOTAL FLOATING & VARIABLE DEMAND NOTES
---------- (Amortized Cost $13,025) ................................................... $ 13,025
----------
------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT COUPON MATURITY VALUE
(000'S) ADJUSTABLE RATE PUT BONDS-- 26.4% RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
$ 620 Lexington-Fayette Co., KY, Urban Govt. Rev. (Providence Montessori) ........ 4.250 07/01/00 $ 620
505 Buckeye Tax-Exempt Mtg. Bond Trust ......................................... 4.520 08/01/00 503
1,110 Summit Co., OH, IDR (S.D. Myers Inc. Proj.) ................................ 4.350 08/15/00 1,110
200 Fairfield, OH, IDR ARPB (Skyline Chili, Inc. Proj.) ........................ 5.000 09/01/00 200
1,200 Owensboro, KY, IDR, Ser. 1985 (Dart Container) ............................. 4.700 09/01/00 1,200
270 Portage Co., OH, IDR (Neidlinger Proj.) .................................... 4.600 09/01/00 270
255 Summit Co., OH, IDR (Keltec Inc. Proj.) .................................... 4.600 09/01/00 255
500 Summit Co., OH, IDR (Struktol Co. America Proj.) ........................... 4.600 09/01/00 500
265 Summit Co., OH, IDR (Triscari Proj.) ....................................... 4.600 09/01/00 265
140 Cuyahoga Co.,OH, IDR (Halle Office Bldg.) .................................. 4.510 10/01/00 140
120 Richland Co., OH, IDR (Robon Partnership Proj.) ............................ 4.650 10/01/00 120
465 Summit Co., OH, IDR (L & W Mfg. Proj.) ..................................... 4.650 10/01/00 465
1,000 Westmoreland Co., PA, IDR (White Consolidated Industries) .................. 5.170 12/01/00 1,000
---------- ----------
$ 6,650 TOTAL ADJUSTABLE RATE PUT BONDS (AMORTIZED COST $6,648) .................... $ 6,648
---------- ----------
$ 25,131 TOTAL INVESTMENT SECURITIES-- 99.8%
========== (Amortized Cost $25,132) ................................................... $ 25,132
OTHER ASSETS IN EXCESS OF LIABILITIES-- 0.2% ............................... 62
----------
NET ASSETS-- 100.0% ........................................................ $ 25,194
==========
</TABLE>
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33
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<PAGE>
<TABLE>
<CAPTION>
CALIFORNIA TAX-FREE MONEY FUND
PORTFOLIO OF INVESTMENTS
JUNE 30, 2000
==============================================================================================================================
PRINCIPAL MARKET
AMOUNT FIXED RATE REVENUE & COUPON MATURITY VALUE
(000'S) GENERAL OBLIGATION BONDS-- 27.6% RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
$ 200 California Health Fac. Fin. Auth. Rev., Ser. B (Catholic Health Facs.) ..... 4.250 07/01/00 $ 200
155 California Health Fac. Fin. Auth. Rev., Ser. B (Children's Hosp.),
Prerefunded @ 102 ........................................................ 6.500 07/01/00 158
200 Los Angeles Co., CA, Trans. Comm. Sales Tax Rev.,
Ser. A (Proposition C) ................................................... 5.500 07/01/00 200
400 Los Angeles Co., CA, Trans. Comm. Sales Tax Rev., Ser. B ................... 5.600 07/01/00 400
500 Puerto Rico Commonwealth Public Impt. GO, Ser. B ........................... 5.500 07/01/00 500
165 Sacramento, CA, Utility Dist. Rev., Ser. 7 ................................. 5.000 07/01/00 165
200 Sacramento, CA, Utility Dist. Rev., Ser. 7 ................................. 5.850 07/01/00 200
335 San Francisco, CA, Bay Area Rapid Trans. Dist. Sales Tax Rev.,
Prerefunded @ 102 ........................................................ 6.750 07/01/00 342
350 Southern California Rapid Trans. Dist. COP (Workers Comp.) ................. 7.625 07/01/00 350
1,000 Fremont, CA, USD, Alameda Co. TRANS ........................................ 4.000 07/28/00 1,000
255 Berkeley, CA, USD GO, Ser. D ............................................... 8.250 08/01/00 256
100 California St. Dept. of Veteran Affairs Home Purchase Rev., Ser. A ......... 6.450 08/01/00 100
250 California St. GO .......................................................... 5.000 08/01/00 250
800 California St. GO .......................................................... 6.900 08/01/00 802
200 Castaic Lake, CA, COP Water Sys. Impt. Rev ................................. 6.750 08/01/00 201
365 Jefferson, CA, USD GO, Ser. A .............................................. 5.750 08/01/00 366
160 Long Beach, CA USD GO, Ser. A .............................................. 7.500 08/01/00 161
1,040 Los Angeles Co.,CA, Schools Regionalized Business Svcs. Rev., Ser. A ....... 0.000 08/01/00 1,037
300 Paso Robles, CA, Joint USD COP ............................................. 4.500 08/01/00 300
185 San Lorenzo, CA, USD COP ................................................... 4.000 08/01/00 185
110 San Marcos, CA, Public Fac. Auth. Tax Rev., Ser. A ......................... 4.500 08/01/00 110
175 Santa Paula, CA, USD GO, Prerefunded @ 102 ................................. 7.200 08/01/00 184
100 Orange Co., CA, Water Dist., Prerefunded @ 102 ............................. 7.000 08/15/00 102
100 California St. GO .......................................................... 5.700 09/01/00 100
100 California St. Public Works Board Lease Rev. Ser. A Prerefunded @ 102 ...... 7.000 09/01/00 103
625 Corona, CA, Comnty Fac. Dist. Ref. Special Tax ............................. 4.000 09/01/00 625
320 Fontana, CA, Special Tax Ref. Comnty Fac. Dist. Special Tax, Ser. A ........ 4.000 09/01/00 320
300 Los Angeles, CA, GO, Ser. A ................................................ 5.100 09/01/00 301
205 San Bernardino, CA Joint Powers Fin. Auth. COP (Police Station Proj.) ...... 3.700 09/01/00 205
100 San Francisco, CA, City & Co. COP .......................................... 5.300 09/01/00 100
250 West Covina, CA COP Ref. (Civic Center Proj.) .............................. 5.250 09/01/00 251
150 California Educational Facs. Auth. Rev.,
(Univ. of San Diego Proj.) Prerefunded @ 102 ............................. 6.750 10/01/00 154
100 California St. Veterans GO, Ser. AS ........................................ 10.000 10/01/00 102
165 Kern Co., CA, COP Capital Impt. Proj. COP .................................. 4.000 11/01/00 165
175 Sacramento, CA, Redevelopment Agcy. Tax Alloc. Rev.,
Ser. A Prerefunded @ 102 ................................................. 6.500 11/01/00 180
875 Los Angeles, CA, Wastewater Sys. Rev., Series D Prerefunded @ 102 .......... 6.700 12/01/00 902
395 Santa Ana, CA, Comnty Redevelopment Agcy. Prerefunded @ 102 ................ 6.500 12/15/00 407
590 Santa Ana, CA, Comnty Redevelopment Agcy. Prerefunded @ 102 ................ 6.500 12/15/00 608
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34
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<PAGE>
CALIFORNIA TAX-FREE MONEY FUND (CONTINUED)
==============================================================================================================================
PRINCIPAL MARKET
AMOUNT FIXED RATE REVENUE & COUPON MATURITY VALUE
(000'S) GENERAL OBLIGATION BONDS-- 27.6% (CONTINUED) RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
$ 210 Santa Ana, CA, Comnty Redevelopment Agcy. Tax Allocation,
Ser. B, Prerefunded @ 102 ................................................ 6.500 12/15/00 $ 216
280 Jefferson, CA, USD GO, Ser. A .............................................. 5.750 02/01/01 283
100 Walnut Valley, CA, USD GO, Ser. A .......................................... 6.250 02/01/01 101
100 Contra Costa, CA, Trans. Auth. Sales Tax Rev., Ser. A ...................... 4.800 03/01/01 101
155 San Francisco, CA, City & Co. Arpt. Comm. Intl. Rev ........................ 6.100 05/01/01 158
100 Stanislaus Co., CA, COP Ref. Capital Impt. Ser. A .......................... 4.375 05/01/01 100
315 San Francisco, CA, City & Co. COP .......................................... 7.375 06/15/01 324
2,000 Los Angeles Co., CA, School Pooled Fin. Prog. COP Ser. A ................... 5.000 07/02/01 2,014
1,000 California School Cash Reserve Prog. Auth. Pooled Loan, Ser. A ............. 5.250 07/03/01 1,009
960 Fremont, CA, USD ........................................................... 5.000 07/10/01 968
---------- ----------
$ 17,215 TOTAL FIXED RATE REVENUE & GENERAL OBLIGATION BONDS
---------- (Amortized Cost $17,366) ................................................... $ 17,366
----------
------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT COUPON MATURITY VALUE
(000'S) FLOATING & VARIABLE DEMAND NOTES-- 78.0% RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
$ 600 California Health Fac. Fin. Auth. Rev., Ser. A ............................. 4.000 07/01/00 $ 600
800 California PCR Fin. Auth. Rev., Ser.B (Southern CA Edison) ................. 4.400 07/01/00 800
400 California PCR Fin. Auth. Ser. A (Pacific Gas & Electric) .................. 4.000 07/01/00 400
1,600 Chula Vista, CA, IDR Ser. A (San Diego Gas & Elec. Co.) .................... 4.350 07/01/00 1,600
200 M-S-R Public Power Agency, CA, Rev., Ser. F (San Juan Proj.) ............... 4.150 07/01/00 200
600 Montebello, CA, IDA IDR (Sunclipse Proj.) .................................. 4.100 07/01/00 600
500 Newport Beach, CA, Rev., (Hoag Memorial Presbyterian Hosp.) ................ 4.250 07/01/00 500
1,800 Newport Beach, CA, Rev., Ser. A (Hoag Memorial Hosp.) ...................... 4.250 07/01/00 1,800
3,000 Newport Beach, CA, Rev., Ser. B (Hoag Memorial Hosp.) ...................... 4.250 07/01/00 3,000
5,600 Newport Beach, CA, Rev., Ser. C (Hoag Memorial Hosp.) ...................... 4.250 07/01/00 5,600
1,900 Orange Co., CA, Sanitation Dist. COP, Ser. C ............................... 4.000 07/01/00 1,900
3,000 Puerto Rico Commonwealth Trans, Ser. A-1 ................................... 4.750 07/01/00 3,000
700 Riverside, CA, IDA IDR Issue A (Sunclipse Inc. Proj.) ...................... 4.100 07/01/00 700
390 San Dimas CA, Redevelopment Agcy. Rev., Ser. 1983
(San Dimas Commerce Center) .............................................. 4.400 07/01/00 390
2,000 ABAG Fin. Auth. Nonprofit Corps. MFH Rev., Ser. A
(Vintage Chateau Proj.) .................................................. 5.000 07/05/00 2,000
2,000 ABN AMRO Munitops Trust Cert. (San Diego, CA) .............................. 4.470 07/05/00 2,000
2,000 ABN AMRO Munitops Trust Cert., Ser. 1999-7 ................................. 4.470 07/05/00 2,000
700 California School Fac. Fin. Corp. COP, Ser. B .............................. 4.400 07/05/00 700
480 California Statewide Cmntys. Dev. Corp. IDR ................................ 4.750 07/05/00 480
180 California Statewide Comnty. Dev Corp Rev .................................. 4.750 07/05/00 180
300 Huntington Park, CA, Public Fin. Auth. Lease Rev. Parking Proj., Ser. A .... 4.950 07/05/00 300
1,545 Oxnard CA, IDA IDR (Van R. Dental Prods, Inc.) ............................. 4.750 07/05/00 1,545
2,800 San Rafael, CA, IDR Bonds (Phoenix American Inc.) .......................... 5.000 07/05/00 2,800
1,600 Vacaville, CA, IDA IDR (Leggett & Platt, Inc.) Ser. B ...................... 4.650 07/05/00 1,600
1,400 Alameda Co., CA, IDR (Bat Prop. LLC Proj.) Ser. 1998A ...................... 4.400 07/06/00 1,400
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<PAGE>
CALIFORNIA TAX-FREE MONEY FUND (CONTINUED)
==============================================================================================================================
PRINCIPAL MARKET
AMOUNT COUPON MATURITY VALUE
(000'S) FLOATING & VARIABLE DEMAND NOTES-- 78.0% (CONTINUED) RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
$ 500 California Health Fac. Fin. Auth. Rev., Ser. B Adventist Health Sys ........ 4.400 07/06/00 $ 500
1,400 Hanford, CA, Sewer Rev., Ser. A ............................................ 4.750 07/06/00 1,400
2,000 Los Angeles, CA, Dept. of Water And Power Electric Rev. Ser. A ............. 4.250 07/06/00 2,000
100 Petaluma, CA, Cmnty. Dev. MFH Rev., Ser. A ................................. 4.400 07/06/00 100
1,000 San Bernardino Co., CA, Capital Impt. Refinancing Proj. COP ................ 4.750 07/06/00 1,000
1,300 San Bernardino Co., CA, COP, Prerefunded @ 102 ............................. 4.420 07/06/00 1,300
900 San Bernardino, CA, IDR (La Quinta Motor Inns) ............................. 4.800 07/06/00 900
2,250 San Diego Co., CA, IDA (Apogee Enterprises, Inc.) Ser. A ................... 4.950 07/06/00 2,250
400 California PCR Fin. Auth. Rev. Ser. 83 (Southdown, Inc.) ................... 4.500 07/15/00 400
3,100 California PCR Fin. Auth. Rev., Ser. B (Southdown, Inc.) ................... 4.500 07/15/00 3,100
$ 49,045 TOTAL FLOATING & VARIABLE DEMAND NOTES (AMORTIZED COST $49,045) ............ $ 49,045
---------- ----------
$ 66,260 TOTAL INVESTMENT SECURITIES-- 105.6%
========== (Amortized Cost $66,411) ................................................... $ 66,411
LIABILITIES IN EXCESS OF OTHER ASSETS-- (5.6%) ............................. (3,511)
----------
NET ASSETS-- 100.0% ........................................................ $ 62,900
==========
</TABLE>
See accompanying notes to financial statements and notes to portfolios of
investments.
TOUCHSTONE FAMILY OF FUNDS
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<PAGE>
<TABLE>
<CAPTION>
OHIO TAX-FREE MONEY FUND
PORTFOLIO OF INVESTMENTS
JUNE 30, 2000
==============================================================================================================================
PRINCIPAL MARKET
AMOUNT FIXED RATE REVENUE & COUPON MATURITY VALUE
(000'S) GENERAL OBLIGATION BONDS-- 30.2% RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
$ 1,250 American Municipal Power Sys. Impt. Rev. BANS (Deshler, OH, Proj.) ......... 4.000 07/10/00 $ 1,250
1,000 American Municipal Power Sys. Impt. Rev. BANS
(Village of New Breman Proj.) ............................................ 3.700 07/10/00 1,000
2,350 American Municipal Power Sys. Impt. Rev. BANS (Montpelier Village Proj.) ... 4.000 07/13/00 2,350
6,997 Morgan, OH, LSD Impt. GO BANS, Ser. 1999 ................................... 4.520 07/14/00 6,998
520 Allen Co., OH, GO BANS Ser. 1999 ........................................... 4.300 07/20/00 520
2,000 Niles City, OH, Water Line Impt. GO BANS ................................... 4.150 07/20/00 2,000
1,800 American Municipal Power Sys. Impt. Rev. BANS (Wapakoneta Proj.) ........... 3.750 07/27/00 1,800
1,500 Athens, OH, CSD GO BANS .................................................... 4.780 07/27/00 1,501
6,000 American Municipal Power Sys. Impt. Rev. BANS (City of Bryan Proj.) ........ 3.900 08/25/00 6,000
1,200 Lisbon, OH, Exempted Village School Dist. Impt. GO BANS, Ser. 1999 ......... 3.800 08/31/00 1,200
900 Springboro, OH, Street Impt. GO BANS ....................................... 3.960 09/07/00 900
2,000 Springdale, OH, Street Impt. GO BANS ....................................... 3.800 09/14/00 2,000
700 Lorain Co., OH, Various Purpose GO BANS, Ser. 1999 ......................... 4.000 09/15/00 700
4,574 Lorain Co., OH, Various Purpose GO BANS, Ser. 1999 ......................... 4.000 09/15/00 4,576
500 North Ridgeville, OH, Road Impt. GO BANS, Ser. 2000 ........................ 4.950 10/19/00 501
1,795 Bluffton Village, OH, Water Sys. Rev. BANS ................................. 4.450 10/26/00 1,797
3,000 Mariemont, OH, CSD GO BANS ................................................. 4.840 10/31/00 3,005
2,200 American Municipal Power Sys. Impt. Rev. BANS (Pioneer Village Proj.) ...... 4.200 11/02/00 2,200
500 Cleveland-Cuyahoga Co., OH, Port Auth. TANS ................................ 3.700 11/15/00 499
600 Marysville, OH, Various Purpose GO BANS .................................... 4.210 11/16/00 601
2,015 Marysville, OH, Various Purpose GO BANS .................................... 4.460 11/16/00 2,017
3,350 Marysville, OH, Various Purpose GO BANS .................................... 5.050 11/16/00 3,354
3,120 Marysville, OH, Various Purpose GO BANS, Ser. 2000C-1 ...................... 4.500 11/16/00 3,123
2,325 Marysville, OH, Various Purpose GO BANS, Ser. 2000D ........................ 4.500 11/16/00 2,327
2,075 Belmont Co., OH, Sanitary Sewer Impt. GO BANS .............................. 4.210 11/21/00 2,077
2,000 American Municipal Power Sys. Impt. Rev. BANS (Bowling Green, OH, Proj.) ... 4.100 12/01/00 2,000
4,000 American Municipal Power Sys. Impt. Rev. BANS (Shelby Proj.) ............... 4.300 12/01/00 4,000
400 Cincinnati, OH, Public Impt. GO ............................................ 4.500 12/01/00 401
3,000 Dayton, OH, Airport Impt. GO BANS .......................................... 4.600 12/01/00 3,005
590 Garfield Heights, OH, Various Purpose GO BANS .............................. 7.050 12/01/00 608
1,000 Springboro, OH, Various Purpose GO BANS, Ser. 1999 ......................... 4.260 12/07/00 1,001
2,126 Union-Scioto, OH, LSD Classroom Fac. GO BANS ............................... 4.900 12/08/00 2,132
940 Clermont Co., OH, Road Impt. GO BANS ....................................... 4.300 12/14/00 941
2,000 Canton, OH, CSD GO BANS .................................................... 4.625 12/15/00 2,003
9,500 American Municipal Power Sys.Equipment Rev. BANS
(Distributive Generation Proj.) .......................................... 5.250 01/19/01 9,464
1,645 Marysville OH, GO (Acquisition Notes) ...................................... 5.010 01/25/01 1,647
1,685 Marysville, OH, Various Purpose GO BANS, Ser. 2000 ......................... 4.470 01/25/01 1,687
4,700 Hebron, OH, Sanitary Sewer Sys. Rev ........................................ 5.100 02/15/01 4,714
1,150 Mason, OH, CSD School Impt. GO BANS, Ser. 2000 ............................. 4.630 02/15/01 1,153
400 Portsmouth, OH, Water Line Fin. GO BANS .................................... 4.600 02/28/01 400
2,000 Beachwood, OH, Various Purpose GO BANS ..................................... 4.500 03/01/01 2,004
TOUCHSTONE FAMILY OF FUNDS
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<PAGE>
OHIO TAX-FREE MONEY FUND (CONTINUED)
==============================================================================================================================
PRINCIPAL MARKET
AMOUNT FIXED RATE REVENUE & COUPON MATURITY VALUE
(000'S) GENERAL OBLIGATION BONDS-- 30.2% (CONTINUED) RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
$ 7,560 American Municipal Power Sys. Impt. Rev. BANS (Wadsworth Proj.) ............ 4.950 03/15/01 $ 7,583
265 Marysville, OH, Various Purpose GO BANS .................................... 4.610 03/15/01 265
200 Marysville, OH, Various Purpose GO BANS .................................... 5.260 03/15/01 200
300 Archbold, OH, Various Purpose GO BANS ...................................... 4.950 03/22/01 301
1,270 Deerfield Township, OH, Park Land Acquisition GO BANS ...................... 4.759 03/28/01 1,273
1,500 Ross Co., OH, Bldg. Auth. Acquisiton GO BANS ............................... 4.750 05/16/01 1,500
1,200 Hebron, OH, Municipal Building GO BANS ..................................... 5.030 05/17/01 1,200
1,100 Williard City, OH, Street Impt. GO BANS .................................... 5.300 05/24/01 1,104
---------- ----------
$ 104,802 TOTAL FIXED RATE REVENUE & GENERAL OBLIGATION BONDS
---------- (Amortized Cost $104,882) .................................................. $ 104,882
----------
------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT COUPON MATURITY VALUE
(000'S) FLOATING & VARIABLE DEMAND NOTES-- 62.2% RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
$ 2,015 Cuyahoga Co., OH, Econ. Dev. Rev ...........................................
(The Cleveland Orchestra Proj.) .......................................... 4.500 07/01/00 $ 2,015
5,680 Cuyahoga Co., OH, Hosp. Rev., Ser. 1997D
(Cleveland Clinic Foundation) ............................................ 4.550 07/01/00 5,680
3,715 Cuyahoga Co., OH, IDR (S&R Playhouse Realty) ............................... 4.750 07/01/00 3,715
3,700 Delaware Co., OH, IDR (Radiation Sterilizers, Inc.) ........................ 4.500 07/01/00 3,700
1,565 Franklin Co., OH, IDR (Capitol South) ...................................... 4.750 07/01/00 1,565
1,200 Franklin Co., OH, IDR (Jacobsen Stores) .................................... 4.750 07/01/00 1,200
4,500 Montgomery Co., OH, (Miami Valley Hosp.) ................................... 4.500 07/01/00 4,500
2,700 Muskingum Co., OH, IDR (Elder-Beerman) ..................................... 4.450 07/01/00 2,700
2,550 Ohio St. Air Quality Dev. Auth. Rev. (CG&E), Ser. A ........................ 4.500 07/01/00 2,550
2,900 Ohio St. Air Quality Dev. Auth. Rev. (Mead Corp.) .......................... 4.450 07/01/00 2,900
1,000 Ohio St. Air Quality Dev. Auth. Rev., Ser. 1985A (CG&E) .................... 4.750 07/01/00 1,000
9,000 Ohio St. Air Quality Dev. Auth. Rev., Ser. 2000A ........................... 4.550 07/01/00 9,000
500 Ohio St. Environmental Impt. Rev. (U.S. Steel Corp. Proj.) ................. 4.450 07/01/00 500
1,110 Ohio St. PCR (Sohio Water Proj.) ........................................... 4.500 07/01/00 1,110
6,900 Puerto Rico Commonwealth Trans, Ser. A-1 ................................... 4.750 07/01/00 6,900
7,000 ABN AMRO Munitops Trust Cert. 1998-I8 (Cleveland Water Works) .............. 4.720 07/05/00 7,000
425 Brunswick, OH, IDR, Ser. A (Kindercare) .................................... 4.750 07/05/00 425
930 Centerville, OH, Health Care Rev. (Bethany Memorial) ....................... 4.850 07/05/00 930
1,280 Clermont Co., OH, Hosp. Fac. Rev. Ser. 1996A ............................... 4.850 07/05/00 1,280
6,211 Clermont Co., OH, Hosp. Fac. Rev., Ser. B (Mercy Health Sys. Proj.) ........ 4.950 07/05/00 6,211
7,000 Clinton Co., OH, Hosp. Rev. Pooled Fin. Prog ............................... 4.850 07/05/00 7,000
2,140 Cuyahoga Co., OH, Educ. Fac. Rev., Ser. 1998
(United Cerebral Palsy Assoc.) ........................................... 4.850 07/05/00 2,140
845 Cuyahoga Co., OH, IDR (Pleasant Lake Assoc.) ............................... 4.850 07/05/00 845
800 Delaware Co., OH, IDR, Ser. 1985 (MRG Ltd. Proj.) .......................... 5.000 07/05/00 800
1,990 Erie Co., OH, IDR (Toft Dairy, Inc.) ....................................... 4.850 07/05/00 1,990
980 Franklin Co., OH, IDR Ser. A (Kindercare) .................................. 4.750 07/05/00 980
564 Franklin Co., OH, IDR Ser. D (Kindercare) .................................. 4.750 07/05/00 564
TOUCHSTONE FAMILY OF FUNDS
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<PAGE>
OHIO TAX-FREE MONEY FUND (CONTINUED)
==============================================================================================================================
PRINCIPAL MARKET
AMOUNT COUPON MATURITY VALUE
(000'S) FLOATING & VARIABLE DEMAND NOTES-- 62.2% (CONTINUED) RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
$ 1,120 Greene Co., OH, Health Care Fac. Rev. (Green Oaks Proj.) ................... 4.850 07/05/00 $ 1,120
200 Hamilton Co., OH, Hosp. Fac. Rev., Ser. F .................................. 4.850 07/05/00 200
(Health Alliance of Greater Cincinnati)
1,040 Hamilton, Co., OH, Health Care Fac. Rev. (Aloysius Orphanage Proj.) ........ 4.850 07/05/00 1,040
375 Hudson Village, OH, IDR, Ser. A (Kindercare) ............................... 4.750 07/05/00 375
725 Huron Co., OH, Rev. (Norwalk Furniture Corp.) .............................. 4.850 07/05/00 725
900 Lorain Co., OH, Hosp. Fac. Rev. (Catholic Healthcare Partners) ............. 4.850 07/05/00 900
1,865 Lorain Co., OH, IDR (EMH Med. Ctr. Proj.) .................................. 4.850 07/05/00 1,865
494 Lorain Co., OH, IDR, Ser. C (Kindercare) ................................... 4.750 07/05/00 494
935 Lucas Co., OH, IDR, Ser. D (Kindercare) .................................... 4.750 07/05/00 935
300 Medina, OH, IDR (Kindercare) ............................................... 4.750 07/05/00 300
800 Meigs Co., OH, IDR, Ser. 1985 (MRG Ltd. Proj.) ............................. 5.000 07/05/00 800
287 Middletown, OH, IDR, Ser. A (Kindercare) ................................... 4.750 07/05/00 287
945 Monroe, OH, IDR, Ser. 1985 (Magnode Corp.) ................................. 4.800 07/05/00 945
2,000 Montgomery Co., OH, EDR (Dayton Art Institute) ............................. 4.750 07/05/00 2,000
340 Montgomery Co., OH, IDR (Kindercare) ....................................... 4.750 07/05/00 340
360 Montgomery Co.,OH, Health Care Rev., Ser. A ................................ 4.850 07/05/00 360
(Dayton Area MRI Consortium)
1,000 Morrow Co., OH, IDR (Field Container Corp.) ................................ 4.800 07/05/00 1,000
3,500 Ohio St. Higher Educ. Fac. Rev. (Kenyon College Proj.) ..................... 4.750 07/05/00 3,500
3,400 Ohio St. Higher Educ. Fac. Rev., Ser. 1992 ................................. 4.750 07/05/00 3,400
1,200 Ohio St. Water Dev. Auth. Rev. (Timken Co. Proj.) .......................... 4.800 07/05/00 1,200
650 Orrville, OH, Hosp. Fac. Rev., Ser. 1990 (Orville Hosp.) ................... 4.800 07/05/00 650
437 Stark Co., OH, IDR, Ser. D (Kindercare) .................................... 4.750 07/05/00 437
3,200 Summit, OH, Civic Fac. Rev., Ser. 1997 (YMCA Proj.) ........................ 4.850 07/05/00 3,200
375 Wadsworth, OH, IDR (Kindercare) ............................................ 4.750 07/05/00 375
800 Wyandot Co., OH, IDR, Ser. 1985 (MRG Ltd. Proj.) ........................... 5.000 07/05/00 800
375 Akron, Bath & Copley, OH, Joint Twnsp. Hosp. Rev ........................... 4.850 07/06/00 375
(Visiting Nurse Svcs. Proj.)
3,000 Ashtabula Co., OH, Hosp. Fac. Rev., Ser. 1995 .............................. 4.800 07/06/00 3,000
(Ashtabula Co. Med. Ctr. Proj.)
2,390 Butler Co., OH, Hosp. Fac. Rev. Ser. 1998A ................................. 4.950 07/06/00 2,390
(Berkeley Square Retirement Ctr. Proj.)
6,965 Cleveland, OH, Waterworks Rev., Ser. 58 .................................... 4.870 07/06/00 6,965
1,400 Clinton Co., OH, Hosp. Rev. (Clinton Memorial Hosp.) ....................... 4.850 07/06/00 1,400
500 Columbus, OH, GO Rev., Ser. 1 .............................................. 4.600 07/06/00 500
2,100 Columbus, OH, GO, Ser. 1 ................................................... 4.600 07/06/00 2,100
2,000 Cuyahoga Co., OH, IDR Ser. 1989 (Motch Corp. Proj.) ........................ 4.950 07/06/00 2,000
3,500 Delaware Co., OH, Health Care Fac. Rev ..................................... 4.920 07/06/00 3,500
2,685 Franklin Co., OH, EDR (Dominican Sisters) .................................. 4.850 07/06/00 2,685
3,460 Franklin Co., OH, EDR, Ser. 1998 (Unity Resource Center Proj.) ............. 4.850 07/06/00 3,460
1,170 Franklin Co., OH, Health Care Fac. Rev ..................................... 4.850 07/06/00 1,170
2,000 Franklin Co., OH, IDR (Alco Standard Corp.) ................................ 4.800 07/06/00 2,000
400 Franklin Co., OH, IDR (Columbus College) ................................... 4.850 07/06/00 400
1,115 Franklin Co., OH, IDR (Ohio Girl Scouts) ................................... 4.850 07/06/00 1,115
TOUCHSTONE FAMILY OF FUNDS
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39
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<PAGE>
OHIO TAX-FREE MONEY FUND (CONTINUED)
==============================================================================================================================
PRINCIPAL MARKET
AMOUNT COUPON MATURITY VALUE
(000'S) FLOATING & VARIABLE DEMAND NOTES-- 62.2% (CONTINUED) RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
$ 1,900 Geauga Co., OH, Health Care Fac. Rev., Ser. 1998A (Heather Hill Proj.) ..... 4.870 07/06/00 $ 1,900
1,079 Hamilton Co., OH, EDR, Ser. 1995 ........................................... 4.950 07/06/00 1,079
(Cincinnati Assoc. for the Performing Arts)
100 Hamilton Co., OH, Hosp. Fac. (Children's Hospital) ......................... 4.900 07/06/00 100
3,000 Hamilton OH, MFH Rev., Ser. A (Knollwood Village Apts.) .................... 4.800 07/06/00 3,000
2,000 Hamilton, OH, MFH Rev. (Knollwood Village Apts.) ........................... 4.800 07/06/00 2,000
2,675 Hancock Co., OH, MFM Rev., Ser. A (Crystal Glen Apts. Proj. Phase II) ...... 4.800 07/06/00 2,675
6,605 Lima, OH, Hosp. Fac. & Impt. Rev., Ser. 1996 (Lima Memorial Hosp.) ......... 4.850 07/06/00 6,605
315 Lucas Co., OH, IDR (Associates Proj.) ...................................... 4.950 07/06/00 315
250 Lucas Co., OH, Rev. (Sunshine Children's Home) ............................. 4.850 07/06/00 250
1,850 Mahoning Co., OH, Health Care Fac. Rev. (Copeland Oaks) .................... 4.800 07/06/00 1,850
1,265 Mahoning Co., OH, Health Care Fac. Rev. (Ohio Heart Institute) ............. 4.850 07/06/00 1,265
3,410 Marion Co., OH, Hosp. Impt. Rev. (Pooled Lease Proj.) ...................... 4.800 07/06/00 3,410
590 Marion Co., OH, Hosp. Impt. Rev. (Pooled Lease Proj.) ...................... 4.800 07/06/00 590
340 Marion Co., OH, Hosp. Impt. Rev. (Pooled Lease Proj.) ...................... 4.900 07/06/00 340
1,150 Mason, OH, Tax Increment Fin. Rev. (Central Park Proj.) .................... 4.970 07/06/00 1,150
3,360 Montgomery Co., OH, Health Care Rev. (Comm. Blood Ctr. Proj.) .............. 4.850 07/06/00 3,360
3,200 Montgomery Co., OH, Ltd. Oblig. Rev., Ser. 1996 ............................ 4.800 07/06/00 3,200
(St.Vincent de Paul Proj.)
4,900 Ohio St. EDR, Ser. 1983 (Court St. Ctr. Assoc. Ltd. Proj.) ................. 4.950 07/06/00 4,900
4,100 Ohio St. Higher Educ. Fac. Rev. (Pooled Fin.) .............................. 4.850 07/06/00 4,100
4,100 Ohio St. Higher Educ. Fac. Rev. (Pooled Fin.) .............................. 4.850 07/06/00 4,100
4,800 Ohio St. Higher Educ. Fac. Rev. (Pooled Fin.) .............................. 4.850 07/06/00 4,800
590 Ohio St. IDR, Ser. 1994 (A.M. Castle & Co. Proj.) .......................... 5.150 07/06/00 590
1,110 Ohio St. Turnpike Rev., Ser. 71 ............................................ 4.870 07/06/00 1,110
1,755 Ottawa Co., OH, Hosp. Fac. Rev. (Luther Home of Mercy Proj.) ............... 4.850 07/06/00 1,755
160 Pike Co., OH, EDR (Pleasant Hill) .......................................... 4.800 07/06/00 160
800 Rickenbacker, OH, Port. Auth. Rev. (Rickenbacker Holdings, Inc.) ........... 4.850 07/06/00 800
5,555 Sharonville, OH, IDR (Duke Realty Proj.) ................................... 4.850 07/06/00 5,555
1,800 Summit Co., OH, Health Care Fac. Rev., Ser. 1997 (Evant, Inc. Proj.) ....... 4.850 07/06/00 1,800
630 Summit Co., OH, IDR (Go-Jo Indust., Inc. Proj.) ............................ 4.850 07/06/00 630
4,260 Trumbull Co., OH, Health Care Fac. Rev. (Shepherd of the Valley) ........... 4.800 07/06/00 4,260
3,995 Univ. of Akron, OH, Gen. Rec., Ser. 165 .................................... 4.870 07/06/00 3,995
1,210 Village of Andover, OH, Health Care Fac. Rev., Ser. 1996
(D&M Realty Proj.) ....................................................... 4.800 07/06/00 1,210
1,600 Warren Co., OH, IDR (Liquid Container Proj.) ............................... 4.850 07/06/00 1,600
850 Westlake, OH, IDR (Nordson Co.) ............................................ 4.900 07/06/00 850
1,400 Hamilton Co., OH, IDR (ADP System) ......................................... 4.500 07/15/00 1,400
---------- ----------
$ 216,212 TOTAL FLOATING & VARIABLE DEMAND NOTES
---------- (Amortized Cost $216,212) .................................................. $ 216,212
----------
TOUCHSTONE FAMILY OF FUNDS
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40
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<PAGE>
OHIO TAX-FREE MONEY FUND (CONTINUED)
==============================================================================================================================
PRINCIPAL MARKET
AMOUNT COUPON MATURITY VALUE
(000'S) ADJUSTABLE RATE PUT BONDS-- 6.9% RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
$ 2,470 Perry Co., OH, Nursing Fac. Rev., Ser. 1996 ................................ 3.700 09/01/00 $ 2,470
(New Lexington Health Corp. Proj.)
590 Riverside, OH, EDR (Riverside Assoc. Ltd. Proj.) ........................... 4.250 09/01/00 590
4,760 Cuyahoga Co.,OH, IDR (Halle Office Bldg.) .................................. 4.510 10/01/00 4,760
1,135 Miami Valley, OH, Tax-Exempt Mtg. Rev. Ser. 1986 ........................... 4.880 10/15/00 1,135
1,315 Clermont Co., OH, EDR (John Q. Hammons Proj.) .............................. 4.600 11/01/00 1,315
550 Franklin Co., OH, IDR (GSW Proj.) .......................................... 4.400 11/01/00 550
2,925 Ohio St. HFA MFH (Lincoln Park) ............................................ 4.400 11/01/00 2,925
3,275 Richland Co., OH, IDR (Mansfield Sq. Proj.) ................................ 4.500 11/15/00 3,275
315 Cuyahoga Co., OH, Health Care Rev .......................................... 5.050 12/01/00 315
4,690 Franklin Co., OH, IDR (Leveque & Assoc. Proj.) ............................. 4.800 12/01/00 4,690
975 Scioto Co., OH, Health Care Rev. (Hillview Retirement) ..................... 4.800 12/01/00 975
880 Gallia Co., OH, IDR (Jackson Pike Assoc.) .................................. 4.750 12/15/00 880
185 Cincinnati & Hamilton Co., OH, Port Auth. EDR
---------- (Kenwood Office Assoc. Proj.) ............................................ 3.600 08/01/01 185
----------
$ 24,065 TOTAL ADJUSTABLE RATE PUT BONDS (AMORTIZED COST $24,065) ................... $ 24,065
---------- ----------
$ 345,079 TOTAL INVESTMENT SECURITIES-- 99.3%
---------- (Amortized Cost $345,159) .................................................. $ 345,159
OTHER ASSETS IN EXCESS OF LIABILITIES-- 0.7% ............................... 2,291
----------
Net Assets-- 100.0% ........................................................ $ 347,450
==========
</TABLE>
See accompanying notes to financial statements and notes to portfolios of
investments.
TOUCHSTONE FAMILY OF FUNDS
----
41
----
<PAGE>
<TABLE>
<CAPTION>
FLORIDA TAX-FREE MONEY FUND
PORTFOLIO OF INVESTMENTS
JUNE 30, 2000
==============================================================================================================================
PRINCIPAL MARKET
AMOUNT FIXED RATE REVENUE & COUPON MATURITY VALUE
(000'S) GENERAL OBLIGATION BONDS-- 22.7% RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
$ 100 Arizona St. Transportation Board, Ser. 1990 (Prerefunded @ 101) ............ 6.750 07/01/00 $ 101
500 First Florida Governmental Fin. Commission, Rev., Ser. C ................... 5.900 07/01/00 500
1,000 Florida St. Dept. of Natural Resources Preservation Rev .................... 4.500 07/01/00 1,000
500 Seminole Co., FL, School Dist. TANS ........................................ 4.000 07/28/00 500
500 Lee Co., FL, School Board COP, Ser. A ...................................... 6.200 08/01/00 501
250 American Municipal Power Sys. Impt. BANS(City Of Bryan Proj.) .............. 4.750 08/25/00 250
95 Louisiana St. GO Prerefunded @ 102 ......................................... 7.125 09/01/00 98
100 Jacksonville, FL, Excise Tax Rev ........................................... 3.900 10/01/00 100
500 Pembroke Pines, FL, Capital Improvement Rev ................................ 3.100 12/01/00 495
500 American Municipal Power Sys. Equipment BANS
(Distributive Generation Proj.) .......................................... 5.250 01/19/01 498
100 Indian River Co., FL, Water & Sewer Rev .................................... 6.500 05/01/01 104
---------- ----------
$ 4,145 TOTAL FIXED RATE REVENUE & GENERAL OBLIGATION BONDS
---------- (Amortized Cost $4,147) .................................................... $ 4,147
----------
------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT COUPON MATURITY VALUE
(000'S) FLOATING & VARIABLE DEMAND NOTES-- 73.1% RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
$ 800 Collier Co., FL, Health Fac. Auth. Hosp. Rev. (Cleveland Clinic) ........... 4.500 07/01/00 $ 800
800 Hillsborough Co., FL, PCR (Tampa Elec. Co. Proj.) .......................... 4.550 07/01/00 800
1,000 Idaho HFA Rev., Ser. 1995 (St. Lukes Regional Hosp.) ....................... 4.600 07/01/00 1,000
1,000 Martin Co., FL, PCR (Florida Power & Light) ................................ 4.600 07/01/00 1,000
475 Volusia Co., FL, HFA MFH Rev., Ser. H (Sun Pointe Apts.) ................... 5.100 07/04/00 475
900 Brevard Co. FL, HFA MFH Rev. Ser. B
(Malabar Lakes & Park Village) ........................................... 4.850 07/05/00 900
300 Broward Co., FL, HFA MFH Rev. (Margate Invts. Proj.) ....................... 4.850 07/05/00 300
100 Clermont Co., OH, Hosp. Fac. Rev., Ser. B
(Mercy Health Sys. Proj.) ................................................ 4.950 07/05/00 100
180 Florida HFA MFH Rev., Ser. EEE (Carlton Arms II Proj.) ..................... 4.850 07/05/00 180
100 Florida Housing Fin. Corp. MFH Rev ......................................... 4.800 07/05/00 100
600 Florida Housing Fin. Corp. Rev., (Oaks at Regency) ......................... 4.800 07/05/00 600
500 Lee Co., FL, IDR Educ. Fac. Rev. (Canterbury School Proj.) ................. 4.800 07/05/00 500
900 Manatee Co., FL, HFA MFH Rev. (Harbour Proj. B) ............................ 4.600 07/05/00 900
900 Palm Beach Co., FL, Rev. (Henry Morrison Flagler Proj.) .................... 4.700 07/05/00 900
225 Putnam Co., FL, Dev. Auth. PCR, Ser. 1984D
(Seminole Elec. Coop.) ................................................... 4.850 07/05/00 225
900 St. Petersburg, FL, HFA Rev. Ser. 1997 (Menorah Manor Proj.) ............... 4.750 07/05/00 900
1,000 Jacksonville, FL, Health Fac. Rev. (Faculty Practice Assoc.) ............... 4.800 07/06/00 1,000
1,150 Jacksonville, FL, Health Fac. Rev. (River Garden) .......................... 4.850 07/06/00 1,150
1,500 ABN AMRO Munitops Trust Cert., Ser. 1998-8 ................................. 4.800 07/08/00 1,500
---------- ----------
$ 13,330 TOTAL FLOATING & VARIABLE DEMAND NOTES
---------- (Amortized Cost $13,330) ................................................... $ 13,330
----------
TOUCHSTONE FAMILY OF FUNDS
----
42
----
<PAGE>
FLORIDA TAX-FREE MONEY FUND (CONTINUED)
==============================================================================================================================
PRINCIPAL MARKET
AMOUNT COUPON MATURITY VALUE
(000'S) ADJUSTABLE RATE PUT BONDS-- 3.3% RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
$ 600 Putnam Co., FL, Dev. Auth. PCR, Ser. H-1 (Seminole Elec. Coop.) ............ 4.350 12/15/00 $ 600
---------- (Amortized Cost $600)
$ 18,075 TOTAL INVESTMENT SECURITIES-- 99.1% (Amortized Cost $18,077) ............... $ 18,077
==========
OTHER ASSETS IN EXCESS OF LIABILITIES-- 0.9% ............................... 167
----------
NET ASSETS-- 100.0% ........................................................ $ 18,244
==========
</TABLE>
See accompanying notes to financial statements and notes to portfolios of
investments.
TOUCHSTONE FAMILY OF FUNDS
----
43
----
<PAGE>
<TABLE>
<CAPTION>
TAX-FREE INTERMEDIATE TERM FUND
PORTFOLIO OF INVESTMENTS
JUNE 30, 2000
==============================================================================================================================
PRINCIPAL MARKET
AMOUNT COUPON MATURITY VALUE
(000'S) MUNICIPAL OBLIGATIONS-- 98.5% RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ARIZONA -- 2.7%
$ 600 Maricopa Co., AZ, School Dist. Rev., Ser. 1991C (Tempe Elem.) .............. 8.000 07/01/04 $ 670
300 Tucson, AZ, Water Dist. Rev ................................................ 9.750 07/01/10 410
----------
1,080
----------
CALIFORNIA -- 1.7%
440 Sacramento Co., CA, MFH ARPB (Fairway One Apts.) ........................... 5.875 02/01/03 440
250 California HFA Multi-Unit Rental Rev., Ser. B .............................. 6.500 08/01/05 257
----------
697
----------
COLORADO -- 2.6%
300 Highland Ranch, CO, Metro. Dist. GO, Ser. A ................................ 5.000 12/01/10 287
740 Broomfield, CO, Water Activity Enterprise Wtr Rev .......................... 5.300 12/01/11 752
----------
1,039
----------
FLORIDA -- 9.7%
500 Florida HFA MFH ARPB, Ser. 1978B (Hampton Lakes II Proj.) .................. 5.700 04/01/01 499
750 Hillsborough Co., FL, Solid Waste Rev ...................................... 5.500 10/01/06 771
455 Pensacola, FL, Airport Rev., Ser. 1997B .................................... 5.400 10/01/07 465
1,000 Pasco Co., FL, HFA MFH Rev., Ser. 1997B (Cypress Trail Apts.) .............. 5.500 06/01/08 1,006
1,120 Florida HFA MFH Sr. Lien, Ser. I-1 ......................................... 6.100 01/01/09 1,148
----------
3,889
----------
ILLINOIS -- 1.4%
500 Chicago, IL, Met Water Reclamation Dist Gtr Chicago ........................ 7.000 01/01/11 574
----------
INDIANA -- 6.4%
1,000 Indiana Bond Bank Special Prog. Rev., Ser. A-1 ............................. 6.650 01/01/04 1,030
1,000 Indiana Health Fac. Fin. Auth. Hosp. Rev. (Clarian Health Partners) ........ 6.000 02/15/05 1,033
500 Indiana HFA Multi-Unit Mtg. Prog. Rev., Ser. 1992A ......................... 6.600 01/01/12 516
----------
2,579
----------
IOWA -- 2.6%
120 Cedar Rapids, IA, Hosp. Fac. Rev. (St. Luke's Methodist Hosp.),
Prerefunded @ 102 ........................................................ 6.000 08/15/03 126
250 Iowa Student Loan Liquidity Corp. Rev ...................................... 6.400 07/01/04 259
280 Iowa HFA Rev., Ser. A ...................................................... 6.500 07/01/06 285
240 Iowa Student Loan Liquidity Corp. Rev ...................................... 6.600 07/01/08 248
130 Cedar Rapids, IA, Hosp. Fac. Rev. (St. Luke's Methodist Hosp.) ............. 6.000 08/15/09 135
----------
1,053
----------
LOUISIANA -- 1.1%
440 Louisiana Public Fac. Auth. Rev. (Medical Ctr. of Louisiana) ............... 6.000 10/15/03 450
----------
MASSACHUSETTS -- 3.7%
500 New England Educ. Loan Mkt. Corp. Rev., Ser. 1992A ......................... 6.500 09/01/02 517
500 New England Educ. Loan Mkt. Corp. Rev., Ser. 1992B ......................... 6.600 09/01/02 518
440 Massachusetts St. Indust. Fin. Agy. Rev., Ser. 1997 (Hudner Assoc.) ........ 5.000 01/01/08 438
----------
1,473
----------
TOUCHSTONE FAMILY OF FUNDS
----
44
----
<PAGE>
TAX-FREE INTERMEDIATE TERM FUND (CONTINUED)
==============================================================================================================================
PRINCIPAL MARKET
AMOUNT COUPON MATURITY VALUE
(000'S) MUNICIPAL OBLIGATIONS-- 98.5% (CONTINUED) RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
MICHIGAN -- 2.4%
$ 500 Detroit MI, GO Ref. Ser. B MBIA ............................................ 6.375 04/01/07 $ 533
425 Battle Creek, MI, EDR (Kellogg Co. Proj.) .................................. 5.125 02/01/09 427
----------
960
----------
MISSISSIPPI -- 1.3%
500 Mississippi Higher Educ. Rev., Ser. B ...................................... 6.100 07/01/01 507
----------
NEBRASKA -- 3.6%
555 Nebraska Invest. Fin. Auth. Rev., Ser. 1989
(Foundation for Educ. Fund), Escrowed to Maturity ........................ 7.000 11/01/09 562
1,000 Nebraska Gas Supply Rev., Ser. A (American Public Energy Agy.) ............. 4.600 06/01/10 891
----------
1,453
----------
NORTH CAROLINA-- 1.7%
350 Carteret Co., NC, COP ...................................................... 5.200 06/01/11 351
350 Carteret Co., NC, COP ...................................................... 5.300 06/01/13 349
----------
700
----------
OHIO -- 43.2%
1,400 Cuyahoga Co., OH, Hosp. Rev., Ser. 1997D
(Cleveland Clinic Foundation) VRDN ....................................... 4.550 07/03/00 1,400
370 Fairfield, OH, IDR ARPB (Skyline Chili, Inc. Proj.) ........................ 5.000 09/01/00 370
270 Warren Co., OH, Hosp. Fac. Rev. (Otterbein Home),
Prerefunded @ 102 ........................................................ 7.000 07/01/01 281
745 Ohio St. EDR Ohio Enterprise Bond Fd. (Smith Steelite Proj.) ............... 5.600 12/01/03 755
500 Hamilton Co., OH, Hosp. Fac. Rev. (Episcopal Retirement Home) .............. 6.600 01/01/04 515
265 Ohio St. EDR Ohio Enterprise Bond Fd. (Cheryl & Co.) ....................... 5.500 12/01/04 268
1,005 Franklin Co., OH, Health Care Rev. (First Comm. Village) ................... 6.000 06/01/06 1,030
530 Toledo, OH, GO ............................................................. 6.000 12/01/06 564
710 Hamilton Co., OH, Health Care Fac. (Twin Towers) ........................... 5.750 10/01/07 715
500 Ohio St. IDR, Ser. 1997 (Bomaine Corporation Proj.) ........................ 5.500 11/01/07 498
599 Columbus, OH, Special Assessment GO ........................................ 5.050 04/15/08 593
1,000 Ohio St. Bldg. Auth. Rev. St. Fac. (Juvenile Correction) ................... 5.000 10/01/08 1,003
800 West Clermont, OH, LSD GO .................................................. 6.150 12/01/08 842
500 Hamilton Co., OH, Hosp. Fac. Rev. (Bethesda Hosp.) ......................... 7.000 07/01/09 506
1,000 Franklin Co., OH, GO ....................................................... 5.450 12/01/09 1,021
1,035 Reading, OH, Rev. (St. Mary's Educ. Institute) ............................. 5.550 02/01/10 1,040
700 Hamilton Co., OH, Health Care Fac. (Twin Towers) ........................... 5.250 10/01/10 670
1,000 Franklin Co., OH, Rev (Online Computer Library Ctr.) ....................... 4.650 10/01/11 926
275 Akron, OH, GO .............................................................. 6.000 11/01/11 293
1,000 Hamilton Co., OH, Sewer Sys Rev Ser A ...................................... 5.500 12/01/11 1,034
1,000 Ohio St. University Rev., Ser. A ........................................... 5.125 12/01/11 995
1,000 Franklin Co., OH, Rev (Online Computer Library Ctr.) ....................... 4.700 10/01/12 921
615 Ohio St. University General Receipts Rev., Ser. A .......................... 5.750 12/01/13 640
465 Cincinnati, OH, Police & Fireman's Disability GO ........................... 5.750 12/01/16 475
----------
17,355
----------
PENNSYLVANIA -- 1.3%
500 Pennsylvania Fin. Auth. Muni. Capital Impt. Proj. Rev ...................... 6.600 11/01/09 529
----------
TOUCHSTONE FAMILY OF FUNDS
----
45
----
<PAGE>
TAX-FREE INTERMEDIATE TERM FUND (CONTINUED)
==============================================================================================================================
PRINCIPAL MARKET
AMOUNT COUPON MATURITY VALUE
(000'S) MUNICIPAL OBLIGATIONS-- 98.5% (CONTINUED) RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA-- 1.9%
$ 725 Richland-Lexington, SC, Airport Dist. Rev., Ser. 1995 (Columbia Metro.) .... 6.000 01/01/08 $ 751
----------
TENNESSEE -- 2.7%
525 Southeast, TN, Tax-Exempt Mtg. Trust ARPB, Ser. 1990 ....................... 7.250 04/01/03 547
500 Nashville, TN, Metro. Airport Rev., Ser. C ................................. 6.625 07/01/07 520
----------
1,067
----------
TEXAS -- 3.2%
50 N. Central, TX, Health Fac. Rev. (Baylor Health Care), Indexed INFLOS,
Prerefunded @ 102 ........................................................ 6.400 05/15/02 52
450 N. Central, TX, Health Fac. Rev. (Baylor Health Care), Indexed INFLOS ...... 6.400 05/15/08 467
515 Robinson, TX, ISD GO ....................................................... 5.750 08/15/10 539
192 Midland, TX, HFC Rev., Ser. A-2 ............................................ 8.450 12/01/11 209
10 San Antonio, TX, Elec. & Gas Rev., Escrowed to Maturity .................... 5.000 02/01/12 10
----------
1,277
----------
VIRGINIA -- 2.9%
1,195 Fairfax Co., VA, GO ........................................................ 5.000 06/01/13 1,165
----------
WASHINGTON -- 1.4%
550 Washington St. Power Supply Sys. Rev., Ser. A (Nuclear Proj. No. 2) ........ 6.500 07/01/03 569
----------
WISCONSIN -- 1.0%
430 Wisconsin St. Health & Educ. Fac. Auth. Rev. (Agnesian Healthcare, Inc.) ... 4.900 07/01/11 404
---------- ----------
$ 38,961 TOTAL MUNICIPAL OBLIGATIONS-- 98.5%
========== (Amortized Cost $39,401) ................................................... $ 39,571
OTHER ASSETS IN EXCESS OF LIABILITIES-- 1.5% ............................... 620
----------
NET ASSETS-- 100.0% ........................................................ $ 40,191
==========
</TABLE>
See accompanying notes to financial statements and notes to portfolios of
investments.
TOUCHSTONE FAMILY OF FUNDS
----
46
----
<PAGE>
<TABLE>
<CAPTION>
OHIO INSURED TAX-FREE FUND
PORTFOLIO OF INVESTMENTS
JUNE 30, 2000
==============================================================================================================================
PRINCIPAL MARKET
AMOUNT FIXED RATE REVENUE & COUPON MATURITY VALUE
(000'S) GENERAL OBLIGATION BONDS-- 96.7% RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
$ 95 Ohio St. Higher Educ. Fac. Comm. Rev., Prerefunded @ 102 ................... 7.250 12/01/00 $ 98
245 Franklin Co., OH, IDR (1st Comm. Village Healthcare),
Crossover Prerefunded @ 101.5 ............................................ 10.125 08/01/01 262
30 Clermont Co., OH, Hosp. Fac. Rev. (Mercy Health Sys.), Prerefunded @ 100 ... 7.500 09/01/01 31
310 Ohio HFA SFM Rev., Ser. D .................................................. 7.000 09/01/01 321
1,000 Clermont Co., OH, Hosp. Fac. Rev. (Mercy Health Sys.), Prerefunded @ 102 ... 6.733 09/25/01 1,044
500 Summit Co., OH, Various Purpose GO, Prerefunded @ 102 ...................... 6.625 12/01/01 524
460 Cleveland, OH, Waterworks Impt. Rev., Ser. F, Prerefunded @ 102 ............ 6.500 01/01/02 481
360 Cuyahoga Co., OH, Hosp. Rev. (University Hosp.), Prerefunded @ 102 ......... 6.250 01/15/02 375
1,000 Kent St. University General Receipts Rev., Prerefunded @ 102 ............... 6.500 05/01/02 1,051
500 Franklin Co., OH, Hosp. Rev. Ser. 1991 (Holy Cross), Prerefunded @ 102 ..... 6.750 06/01/02 528
500 Mahoning Co., OH, Hosp. Impt. Rev. (YHA, Inc.), Prerefunded @ 100 .......... 7.000 10/15/02 514
675 Reynoldsburg, OH, CSD GO, Prerefunded @102 ................................. 6.550 12/01/02 716
500 Seneca Co., OH, GO (Jail Fac.), Prerefunded @ 102 .......................... 6.500 12/01/02 530
127 Ohio St. Bldg. Auth. Rev. (Columbus St. Proj.), Prerefunded @ 100 .......... 10.125 04/01/03 141
31 Ohio St. Bldg. Auth. Rev. (Frank Lausch Proj.), Prerefunded @ 100 .......... 10.125 04/01/03 34
230 Summit Co., OH, GO, Ser. A, Prerefunded @ 100 .............................. 6.900 08/01/03 244
591 Ohio HFA SFM Rev., Ser. 1991D .............................................. 7.050 09/01/03 611
500 Newark, OH, Water Sys. Impt. Rev., Prerefunded @ 102 ....................... 6.000 12/01/03 528
290 Northwest, OH, LSD GO, Prerefunded @ 102 ................................... 7.050 12/01/03 306
500 Ohio St. Bldg. Auth. Rev., Ser. 1994A (Juvenile Correctional Bldg.),
Prerefunded @ 102 ........................................................ 6.600 10/01/04 543
290 Alliance, OH, CSD GO ....................................................... 6.900 12/01/06 304
500 Mansfield, OH, Hosp. Impt. Rev. (Mansfield General) ........................ 6.700 12/01/09 522
450 Ohio Capital Corp. MFH Rev., Series 1990A .................................. 7.500 01/01/10 464
500 Hamilton, OH, Water Sys. Mtg. Rev., Ser. 1991A ............................. 6.400 10/15/10 517
500 Butler Co., OH, Hosp. Fac. Rev. (Middletown Regional Hospital) ............. 6.750 11/15/10 522
1,000 Alliance, OH, CSD GO ....................................................... 5.500 12/01/10 967
40 Cleveland, OH, Waterworks Impt. Rev., Ser. F ............................... 6.500 01/01/11 42
230 Cuyahoga Co., OH, Hosp. Rev. (University Hosp.)
Escrowed to Maturity ..................................................... 9.000 06/01/11 277
365 Bexley, OH, CSD GO ......................................................... 7.125 12/01/11 423
530 Urbana, OH, Wastewater Impt. GO ............................................ 7.050 12/01/11 565
600 Westerville, OH, Water Sys. Impt. GO ....................................... 6.450 12/01/11 628
500 Strongsville, OH, CSD GO ................................................... 5.375 12/01/12 510
1,095 West Clermont, OH, LSD GO .................................................. 6.900 12/01/12 1,202
500 Worthington, OH, CSD GO .................................................... 6.375 12/01/12 523
530 Ottawa Co., OH, GO ......................................................... 5.750 12/01/14 543
1,000 Portage Co., OH, GO ........................................................ 6.200 12/01/14 1,060
400 Warren, OH, Waterworks Rev ................................................. 5.500 11/01/15 405
1,000 Buckeye Valley, OH, LSD GO ................................................. 6.850 12/01/15 1,142
500 Ohio St. Higher Educ. Fac. Rev. (Univ. of Dayton) .......................... 6.750 12/01/15 530
500 Cleveland, OH, Waterworks Impt. Rev., Ser. F ............................... 6.250 01/01/16 519
TOUCHSTONE FAMILY OF FUNDS
----
47
----
<PAGE>
OHIO INSURED TAX-FREE FUND (CONTINUED)
==============================================================================================================================
PRINCIPAL MARKET
AMOUNT FIXED RATE REVENUE & COUPON MATURITY VALUE
(000'S) GENERAL OBLIGATION BONDS-- 96.7% (CONTINUED) RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
$ 740 Columbus-Polaris Hsg. Corp. Rev., Prerefunded @ 100 ........................ 7.400 01/01/16 $ 817
171 Ohio HFA SFM Rev., Ser. 1990F .............................................. 7.600 09/01/16 175
750 Montgomery Co., OH, Hosp. Rev. (Miami Valley Hosp.) ........................ 6.250 11/15/16 770
1,000 Greater Cleveland, OH, Regional Trans. Auth. GO ............................ 4.750 12/01/16 896
1,260 Cleveland, OH, Airport Sys. Rev., Ser. C ................................... 5.125 01/01/17 1,190
750 Butler Co.,OH, Transportation Impt. Dist., Ser. A .......................... 5.125 04/01/17 710
500 Toledo, OH, Sewer Sys. Rev ................................................. 6.350 11/15/17 530
1,000 Toledo, OH, Waterworks Sys. Mtg. Rev ....................................... 4.750 11/15/17 888
1,000 Rocky River, OH, CSD GO, Ser. 1998 ......................................... 5.375 12/01/17 989
1,000 Ohio St. Bldg. Auth. Rev. (Adult Correctional Bldg.) ....................... 5.250 10/01/18 959
1,670 Canton, OH, GO ............................................................. 4.750 12/01/18 1,478
2,500 Ohio St. Water Dev. Auth. Impt. Rev ........................................ 5.125 06/01/19 2,333
1,000 University of Cincinnati, OH, General Receipts Rev ......................... 5.750 06/01/19 1,007
1,000 Lucas Co., OH, Hsg. Dev. Corp. (Northgate Apts.) Ser. A .................... 5.950 07/01/19 1,003
1,000 Lorain Co., OH, Hosp. Rev. (Catholic Health Partners) ...................... 5.500 09/01/19 980
1,000 Lucas Co., OH, Hosp. Rev. (Promedica Health) ............................... 5.625 11/15/19 983
2,000 Avon Lake, OH, CSD GO ...................................................... 5.500 12/01/19 1,969
2,145 Brunswick, OH, CSD ......................................................... 5.750 12/01/19 2,165
745 Crawford Co., OH, GO ....................................................... 4.750 12/01/19 652
1,000 Evergreen OH, LSD .......................................................... 5.500 12/01/19 985
2,000 Hamilton, OH, CSD GO ....................................................... 5.500 12/01/19 1,960
1,250 Kings, OH, LSD GO .......................................................... 5.950 12/01/19 1,282
500 Akron, OH, GO .............................................................. 5.800 11/01/20 500
750 Greene Co., OH, Sewer Sys. Rev. ............................................ 5.125 12/01/20 696
1,000 Greene Co., OH, Sewer Sys. Rev ............................................. 5.625 12/01/20 992
1,245 Hamilton Co., OH, Swr. Sys. Impt. Rev., Ser. A ............................. 5.700 12/01/20 1,243
525 Kings, OH, LSD GO .......................................................... 6.050 12/01/21 539
2,000 Lake, OH, LSD GO (Stark Co.) ............................................... 5.750 12/01/21 2,003
1,000 Summit Co., OH, GO ......................................................... 6.000 12/01/21 1,032
1,035 Lima OH, CSD ............................................................... 5.500 12/01/22 997
500 Morgan, OH, LSD GO ......................................................... 5.750 12/01/22 501
1,250 Scioto Valley, OH, LSD ..................................................... 5.650 12/01/22 1,236
1,000 Hamilton, OH, CSD GO ....................................................... 5.625 12/01/24 985
1,000 Hilliard, OH, CSD GO ....................................................... 5.750 12/01/24 997
1,000 Kings, OH, LSD GO .......................................................... 5.650 12/01/24 968
1,250 Ohio St. University General Receipts Rev., Ser. A .......................... 5.750 12/01/24 1,247
1,000 Hilliard, OH, CSD GO ....................................................... 5.750 12/01/28 992
925 Licking Heights, OH, LSD GO ................................................ 6.400 12/01/28 932
---------- ----------
$ 60,935 TOTAL FIXED RATE REVENUE & GENERAL OBLIGATION BONDS-- 100.7%
---------- (Amortized Cost $59,905) ................................................... $ 61,128
----------
TOUCHSTONE FAMILY OF FUNDS
----
48
----
<PAGE>
OHIO INSURED TAX-FREE FUND (CONTINUED)
==============================================================================================================================
PRINCIPAL MARKET
AMOUNT COUPON MATURITY VALUE
(000'S) FLOATING AND VARIABLE DEMAND NOTES-- 4.0% RATE DATE (000'S)
------------------------------------------------------------------------------------------------------------------------------
$ 2,400 Cuyahoga Co., OH, Hosp. Rev., Ser. 1997D (Cleveland Clinic Foundation) ..... 4.550 07/01/00 $ 2,400
100 Columbus, OH, GO Rev., Ser. 1 .............................................. 4.600 07/07/00 100
---------- ----------
$ 2,500 TOTAL FLOATING AND VARIABLE DEMAND NOTES
---------- (Amortized Cost $2,500) .................................................... $ 2,500
----------
$ 63,435 TOTAL INVESTMENTS AT VALUE-- 100.7%
========== (Amortized Cost $62,405) ................................................... $ 63,628
LIABILITIES IN EXCESS OF OTHER ASSETS-- (0.7%) ............................. (443)
----------
NET ASSETS-- 100.0% ........................................................ $ 63,185
==========
</TABLE>
See accompanying notes to financial statements and notes to portfolios of
investments.
TOUCHSTONE FAMILY OF FUNDS
----
49
----
<PAGE>
NOTES TO PORTFOLIOS OF INVESTMENTS
JUNE 30, 2000
================================================================================
Variable and adjustable rate put bonds earn interest at a coupon rate which
fluctuates at specified intervals, usually daily, monthly or semi-annually. The
rates shown in the Portfolios of Investments are the coupon rates in effect at
June 30, 2000.
Put bonds may be redeemed at the discretion of the holder on specified dates
prior to maturity. Mandatory put bonds are automatically redeemed at a specified
put date unless action is taken by the holder to prevent redemption.
Bonds denoted as prerefunded are anticipated to be redeemed prior to their
scheduled maturity. The dates indicated in the Portfolios of Investments are the
stipulated prerefunded dates.
PORTFOLIO ABBREVIATIONS:
ARPB - Adjustable Rate Put Bond
BANS - Bond Anticipation Notes
COP - Certificates of Participation
CSD - City School District
EDR - Economic Development Revenue
GO - General Obligation
HFA - Housing Finance Authority/Agency
HFC - Housing Finance Corporation
IDA - Industrial Development Authority/Agency
IDR - Industrial Development Revenue
ISD - Independent School District
LSD - Local School District
MFH - Multi-Family Housing
MFM - Multi-Family Mortgage
PCR - Pollution Control Revenue
SFM - Single Family Mortgage
TANS - Tax Anticipation Notes
USD - Unified School District
VRDN - Variable Rate Demand Notes
TOUCHSTONE FAMILY OF FUNDS
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<PAGE>
RESULTS OF SPECIAL MEETING OF SHAREHOLDERS
APRIL 19, 2000 (UNAUDITED)
================================================================================
On April 19, 2000, a Special Meeting of Shareholders of Touchstone Tax-Free
Trust (the Trust) was held (1) to approve or disapprove new investment advisory
agreements with Touchstone Advisers, Inc., (2) to approve or disapprove new
subadvisory agreements with Fort Washington Investment Advisors, Inc. and (3) to
approve or disapprove the termination of the Trust's current independent public
accountants and the selection of Ernst & Young LLP as independent auditors for
the fiscal year ended June 30, 2000. The total number of shares of the Trust
present by proxy represented 59.5% of the shares entitled to vote at the
meeting. Each of the matters submitted to shareholders was approved.
The results of the voting for or against the approval of the new investment
advisory agreements by each Fund was as follows:
--------------------------------------------------------------------------------
NUMBER OF SHARES
---------------------------------------------
FOR AGAINST ABSTAIN
--------------------------------------------------------------------------------
Tax-Free Money Fund 11,995,568 1,638,089 131,616
California Tax-Free Money Fund 67,424,730 37,530 12,322
Ohio Tax-Free Money Fund 208,471,312 151,320 1,288,677
Florida Tax-Free Money Fund 9,245,957 16 3,167
Tax-Free Intermediate Term Fund 2,065,412 24,552 90,986
Ohio Insured Tax-Free Fund 2,889,279 104,897 93,308
--------------------------------------------------------------------------------
The results of the voting for or against the approval of the new subadvisory
agreements by each Fund was as follows:
--------------------------------------------------------------------------------
NUMBER OF SHARES
---------------------------------------------
FOR AGAINST ABSTAIN
--------------------------------------------------------------------------------
Tax-Free Money Fund 11,995,568 1,638,089 131,616
California Tax-Free Money Fund 67,461,325 52 13,205
Ohio Tax-Free Money Fund 208,471,730 151,320 1,288,259
Florida Tax-Free Money Fund 9,245,972 -- 3,167
Tax-Free Intermediate Term Fund 2,066,323 21,507 93,120
Ohio Insured Tax-Free Fund 2,890,722 97,022 99,740
--------------------------------------------------------------------------------
The results of the voting for against the termination of the Trust's current
independent public accountants and the selection of Ernst & Young LLP as
independent auditors by each Fund was as follows:
--------------------------------------------------------------------------------
NUMBER OF SHARES
---------------------------------------------
FOR AGAINST ABSTAIN
--------------------------------------------------------------------------------
Tax-Free Money Fund 13,519,321 88,497 157,456
California Tax-Free Money Fund 67,405,279 52 69,251
Ohio Tax-Free Money Fund 208,020,856 1,323,823 566,630
Florida Tax-Free Money Fund 9,245,957 16 3,167
Tax-Free Intermediate Term Fund 2,072,247 16,206 92,496
Ohio Insured Tax-Free Fund 2,873,268 103,115 111,101
--------------------------------------------------------------------------------
TOUCHSTONE FAMILY OF FUNDS
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REPORT OF INDEPENDENT AUDITORS
================================================================================
To the Shareholders and Trustees of the Touchstone Tax-Free Trust
We have audited the accompanying statements of assets and liabilities, including
the schedules of portfolio investments, of Touchstone Tax-Free Trust (consisting
of Tax-Free Money Fund, California Tax-Free Money Fund, Ohio Tax-Free Money
Fund, Florida Tax-Free Money Fund, Tax-Free Intermediate Term Fund, Ohio Insured
Tax-Free Fund) (the Funds) as of June 30, 2000, the related statements of
operations and statements of changes in net assets for the year then ended and
the financial highlights for the period then ended. 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. The statements of changes in net
assets presented herein for the year ended June 30, 1999 and the financial
highlights presented herein for each of the respective years or periods ended
June 30, 1999 were audited by other auditors whose report dated August 6, 1999
expressed an unqualified opinion.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the
audits 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. Our procedures included confirmation of securities
owned as of June 30, 2000, by correspondence with the custodians and brokers. 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 each
of the respective Funds constituting the Touchstone Tax-Free Trust as of June
30, 2000, the results of their operations and the changes in their net assets
for the year then ended and the financial highlights for the period then ended,
in conformity with accounting principles generally accepted in the United
States.
/s/ Ernst & Young LLP
Cincinnati, Ohio
August 15, 2000
TOUCHSTONE FAMILY OF FUNDS
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<PAGE>
TOUCHSTONE FAMILY OF FUNDS
DISTRIBUTOR
Touchstone Securities, Inc.
311 Pike Street
Cincinnati, Ohio 45202-4094
800.638.8194
www.touchstonefunds.com
INVESTMENT ADVISOR
Touchstone Advisors, Inc.
311 Pike Street
Cincinnati, Ohio 45202-4094
TRANSFER AGENT
Integrated Fund Services, Inc.
P.O. Box 5354
Cincinnati, Ohio 45201-5354
SHAREHOLDER SERVICE
800.543.0407
TOUCHSTONE
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FAMILY OF FUNDS
