FIRST AMERICAN FUNDS, INC.
FIRST AMERICAN INVESTMENT FUNDS, INC.
ANNUAL REPORT
SEPTEMBER 30, 1995
[LOGO] FIRST AMERICAN FUNDS
The power of disciplined investing
TABLE OF CONTENTS
MESSAGE FROM YOUR CHAIRMAN 1
ECONOMIC AND INVESTMENT REVIEW 2
PORTFOLIO PERFORMANCE DISCUSSION 4
STATEMENTS OF NET ASSETS 18
STATEMENTS OF OPERATIONS 77
STATEMENTS OF CHANGES IN NET ASSETS 83
FINANCIAL HIGHLIGHTS 88
NOTES TO FINANCIAL STATEMENTS 93
INDEPENDENT AUDITORS' REPORT 100
NOTICE TO SHAREHOLDERS 101
MESSAGE FROM YOUR CHAIRMAN
September 30, 1995
Dear Shareholders:
On behalf of the Board of Directors of the Funds, I am pleased to report that
the year ended September 30, 1995 was one of solid growth for the First American
family of funds. Net assets under management increased dramatically, surpassing
the $7 billion mark. The growth in net assets under management was spread across
the complex as most of the Funds experienced solid growth during the year.
Both equity and bond markets were extremely strong during the past 12 months,
posting returns well above historical norms. It is important that returns in
1995 be kept in proper perspective. It can be expected that there will be
occasional periods of below average returns in the financial markets at times in
the future. The Funds are fortunate to have experienced fund managers who have
performed well against benchmarks using conservative principles of asset
management.
We are pleased to report that the First American Regional Equity, Technology and
Diversified Growth Funds all posted returns in excess of their benchmarks. For
the year ended September 30, 1995, the total return for the Class A shares of
the Regional Equity Fund was 41.17%, the Technology Fund posted a total return
of 66.22%, and the Diversified Growth Fund had a total return of 31.21%. Many of
the other funds also posted solid returns and the First American family of funds
received regional and national attention as a result of outstanding investment
performance.
As a result of our continuing efforts to provide shareholders with a wide array
of high quality investment products, the First American Real Estate Securities
Fund was opened during the fiscal year. The Fund offers investors access to one
of the world's largest asset classes and the potential for above average current
income and capital appreciation. The new product is indicative of the product
innovation and investment expertise you can expect from our Fund family.
We urge you to read the following report closely. In it you will find a letter
from our Investment Adviser which recaps events in the financial markets for the
past 12 months and provides an outlook for the year ahead. In addition, you will
find a discussion of the performance of each of the First American Funds during
the 12 months ended September 30, 1995.
Finally, the Board of Directors thank you for your continued confidence in the
Funds. We look forward to providing you with investment management to meet your
needs now and in the years ahead.
Sincerely,
/s/ Joseph D. Strauss
JOSEPH D. STRAUSS
Chairman
First American Funds
First American Investment Funds
ECONOMIC AND INVESTMENT REVIEW
September 30, 1995
Dear Shareholders:
An unusually favorable confluence of factors has driven the value of stocks and
bonds upward over the past year. Growing conviction that action would replace
rhetoric in the perennial effort to balance the federal budget and deceleration
of economic growth to a sustainable, noninflationary pace early in the year laid
the foundation for this year's market strength. Peaking industrial commodity
prices, a reversal of Federal Reserve monetary policy, excellent corporate
profitability, a stronger dollar, and an impressive flow of funds into the
markets from domestic and foreign sources combined to overwhelm the concerns
that placed a heavy hand on the bond and stock markets last year.
Investors who held fast through the cross currents of 1994 have been compensated
this year. Low inflation and slow economic growth contributed to the sharp drop
of long treasury bond yields from over 8.0% last fall to approximately 6.30%
today. Surprisingly strong profit comparisons and lower interest rates drove
stocks to new highs in a virtually uninterrupted advance over the past year. The
S&P 500 has produced nearly a 30% total return this year, while returns on
smaller capitalization stocks have averaged about 40%. The First American Fund
family has fully participated in this favorable market environment with several
Funds among the performance pace setters within their peer groups.
Aside from the economic and policy elements, two other factors have figured
importantly in the markets' highly favorable performance: improved investor
sentiment and an accelerated flow of household assets into retirement related
investments. As concern over the economy, inflation, and the dollar dissipated,
investors have expressed their relief by entering the market in a more
aggressive manner. The virtual explosion of personal retirement investing has
been well documented. Now, with the favorable features of the economic and
market landscape well reflected in the valuation of the markets we must ask
"what's next?"
The current economic expansion has resembled a traditional post-war cycle,
captured by slow-motion photography. This year's inventory adjustment that had
its roots in the binge of spending and production in 1994 and subsequent
consumer and producer caution will continue to restrain economic growth in the
months ahead. Today, the consumer is cautious and price conscious. Rising debt
levels, relative to income, insufficient savings for financial self-sufficiency,
and generalized job insecurity have also combined to bring spending back to a
pace that has forced highly competitive retail pricing. Moderate growth and
inflation near 3.0% is, of course, exactly the prescription for sufficient
monetary accommodation to support a sustained economic expansion. Despite
corporate restructuring, payrolls should grow and the income produced should
support moderate economic growth. Capital spending, somewhat short of the
explosive levels of recent years, and growing exports to reaccelerating overseas
economies will also contribute to continued domestic economic expansion and
bring growth to a pace in excess of 2.5% later in 1996. Sustaining corporate
profitability, at its current high level will become a challenge for some
industries despite strong productivity gains and very modest compensation cost
increases.
In this context we do not expect the structure of interest rates to fall much
further. Although the Federal Reserve may reduce short interest rates a bit in
coming months and progress will be made in achieving a balanced federal budget,
the good news for bonds is largely absorbed in the markets at current yield
levels. We would not be surprised to see bond yields rise with the first
evidence of the reacceleration in economic activity. First American bond
portfolios are neutrally positioned at this time to reflect the current fair
valuation of the market, given our economic and policy outlook.
Faced with more challenging profit comparisions and the prospect that the
decline in interest rates is largely over, the near term opportunity for
significant appreciation in common stocks seems limited. Equities appear fairly
priced by historical standards, but strong investment flows into mutual funds
continue to support the stock market. With the current perception of a slower
phase of the economic expansion, the stock market has shifted group and sector
interest from economically sensitive stocks to equities recognized either for
dependable growth (consumer nondurables) or for rapid, product-driven growth
(technology). A fascination with restructuring and cost reduction still grips
the market; a number of stocks of companies "fixing problems" have contributed
to the performance of the First American equity funds over the past year. With
the stock market at new highs and finding fewer investment opportunities that
fill the demands of our investment disciplines, the diversified equity funds
have built moderate cash reserves in anticipation of better investment
opportunities in months ahead. Despite some caution near term, the potential
growth of the world economy seems bright. Your equity funds are well positioned
to participate in the global expansion.
The First American family of funds continues to grow rapidly in assets under
management. A variety of investment alternatives are available to fulfill the
unique investment needs of each of our shareholders, often through a combination
of funds. Despite the significant diversity of First American Fund offerings,
there is a common thread in all equity and fixed income portfolios: each employs
a well-defined discipline in its selection and retention of investment assets.
It has been a privilege to serve our shareholders over the past year. We
appreciate your confidence and look forward to serving you in the new year.
Sincerely,
/s/ John M. Murphy, Jr.
John M. Murphy, Jr.
Chief Investment Officer,
First Asset Management
PORTFOLIO PERFORMANCE DISCUSSION
September 30, 1995
FIRST AMERICAN FUNDS
The following review of each fund is intended to help you understand the
performance of your investment in the First American Funds.
The charts represent the growth of a $10,000 investment in each fund since its
inception. The ending balance on September 30, 1995, shows how your account
would have grown had you invested $10,000 when the fund was introduced including
reinvestment of all distributions.
All performance data quoted in the discussions that follow (with the exception
of the Money Market Funds, Limited Volatility Stock Fund, and the Real Estate
Securities Fund) represent total returns for Class A Shares at Net Asset Value.
Terms and Definitions:
Class A Shares -- are generally subject to an initial sales charge.
Class B Shares -- may be subject to a sales charge upon redemption.
Class C Shares -- are not subject to an initial sales or redemption charge and
are reserved for large institutional investors.
Net Asset Value (NAV) is the value of all your fund's assets, minus any
liabilities, divided by the number of shares outstanding, not including any
initial or contingent deferred sales charge.
Public Offering Price (POP) is the price of a mutual fund share plus the maximum
sales charge levied at the time of purchase. POP performance figures shown
assume the maximum sales charge for Class A Shares.
Contingent Deferred Sales Charge (CDSC) is a charge applied at the time of the
redemption of Class B Shares and assumes redemption at the end of the period.
Your fund's CDSC declines from a 5% maximum during the first year to 1% during
the sixth year. After the eighth year, the CDSC no longer applies.
MONEY MARKET FUNDS
January 1995 marked the final stage of the Federal Reserve's seven step doubling
of short-term interest rates which began in February 1994. The result has been a
slowing of the domestic economy to a level that should be sustainable into the
foreseeable future, the so called "soft landing," and has established the Fed's
credibility as an inflation fighter. More recently, in July the Fed took out
some "recession insurance" with a 25 basis point cut in the Fed funds rate to
5.75%.
The Fed's disinflation commitment and a modest pick up in economic growth in
coming months may restrain further monetary policy ease. However, support of
Congressional budget cutting efforts and low reported inflation suggest an
adjustment in short-term rates. The balance will probably be struck in favor of
an additional 25 basis point rate cut this winter, building on July's action.
Given the uncertainty surrounding the economic environment and the Federal
Reserve's restrictive monetary policy, the First American Money Market Funds
maintained a defensive posture most of this past year with the average
maturities somewhat shorter than the industry average. More recently the Funds
have been modestly lengthening the average maturity in line with the industry.
The primary focus continues to be the maintenance of high quality assets and
excellent liquidity in each portfolio. As noted in the past, the Funds have
never invested in any of the derivative securities that created problems for
other money market funds during this past year.
PRIME OBLIGATIONS FUND
At fiscal year-end, the institutional class had a 7-day yield of 5.55% and an
average portfolio maturity of 29 days. During the prior year the average
maturity ranged from a low of 20 days to a high of 41 days.
GOVERNMENT OBLIGATIONS FUND
At fiscal year-end, the institutional class had a 7-day yield of 5.48% and an
average portfolio maturity of 34 days. During the prior year the average
maturity ranged from a low of 14 days to a high of 35 days.
TREASURY OBLIGATIONS FUND
At fiscal year-end, the institutional class had a 7-day yield of 5.46% and an
average portfolio maturity of 38 days. During the prior year the average
maturity ranged from a low of 15 days to a high of 40 days. This Fund has a
triple-A rating from both Moody's and Standard & Poor's.
LIMITED TERM INCOME FUND
The decline in interest rates since November 1994 has occurred all along the
yield curve and has benefited even short-maturity fixed income instruments.
Indeed, in the first 6 months of 1995, the fall in short-term rates exceeded
that of longer maturities, although in the third quarter the pattern was
reversed and long rates fell somewhat further.
The Fund's mix of asset-backed securities, conservatively structured
mortgage-related instruments and a few corporate bonds is designed to produce a
reasonable level of current income. The Fund is also positioned to benefit from
a decline in interest rates. Mortgage-backed, asset-backed and corporate yield
spreads have all narrowed discernibly over the past year, but mortgages and
asset-backed securities in particular still have worthwhile yield advantages
compared with Treasuries or government agency securities. As is customarily the
case, the average maturity of the Fund remains short enough (about 1 year) to
dampen the effects of rising interest rates, should that occur during 1996.
The Fund's total return for the year ended September 30, 1995, was 6.57%
compared with 6.76% for the Merrill Lynch 1 year Treasury Index.
[GRAPH]
<TABLE>
<CAPTION>
12/31/92 Sep-93 Sep-94 Sep-95
<S> <C> <C> <C> <C>
First American Limited-Term Income Fund (Class A POP) 9,800 10,137 10,361 11,042
Merrill Lynch 1-Year Treasury Index 10,000 10,293 10,552 11,265
First American Limited-Term Income Fund (Class A NAV) 10,000 10,344 10,573 11,267
</TABLE>
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class C shares on 12/31/92 would have been valued at
$11,267 on 9/30/95.
One Annualized
Year Inception
Return To Date
CLASS A NAV 6.57% 4.43%
CLASS A POP 4.45% 3.69%
CLASS C 6.57% 4.43%*
The inception date of the Class A shares is 12/14/92 and the inception date of
the Class C shares is 2/4/94.
* Total Returns for periods prior to the inception date of Class C shares
were calculated using synthetic returns since inception of the Class A
shares at NAV. The Annualized Total Return for the Limited Term Income Fund
Class C since inception, which is not synthetic, is 4.71%.
INTERMEDIATE TERM INCOME FUND
After rising sharply for most of 1994, interest rates began to decline in
November and the rally accelerated in the second quarter of this year. From
mid-November 1994 through September of 1995, 3-year treasury yields declined
about 130 basis points and 10-year rates were down 180 basis points.
The Fund continues to contain a mix of Treasury, mortgage-backed, and good
quality corporate securities. All sectors performed well in the past year, but
corporate bonds particularly so because a reasonably healthy economy and strong
corporate profit growth have reduced concerns about credit quality.
Consequently, yield spreads between corporate and Treasury securities became
narrower in 1995 than they have been for a number of years.
For the year ended September 30, 1995, the Fund had a return of 10.51%, compared
with a return of 11.27% for the Lehman Intermediate Government/Corporate Bond
Index.
[GRAPH]
<TABLE>
<CAPTION>
12/31/92 Sep-93 Sep-94 Sep-95
<S> <C> <C> <C> <C>
First American Intermediate-Term Income Fund (Class A POP) 9,625 10,273 10,165 11,233
First American Intermediate-Term Income Fund (Class A NAV) 10,000 10,673 10,561 11,671
Lehman Brothers Intermediate-Term Government/Corporate Index 10,000 10,860 10,680 11,883
</TABLE>
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class C shares on 12/31/92 would have been valued at
$11,671 on 9/30/95.
One Annualized
Year Inception
Return To Date
CLASS A NAV 10.51% 5.86%
CLASS A POP 6.39% 4.42%
CLASS C 10.51% 5.86%*
The inception date of the Class A shares is 12/14/92 and the inception date of
the Class C shares is 2/4/94.
* Total Returns for periods prior to the inception date of Class C shares
were calculated using synthetic returns since inception of the Class A
shares at NAV. The Annualized Total Return for the Intermediate Term Income
Fund Class C since inception, which is not synthetic, is 5.28%.
FIXED INCOME FUND
The past year in U.S. credit markets has been a distinct relief from the
environment of sharply rising interest rates and falling bond prices in 1994.
The bond rally, which started in November 1994, accelerated strongly in the
first half of 1995. Bond returns in the first 6 months of this year were the
highest in any similar period in the past 10 years.
For much of 1995, the Fund was heavily weighted in Treasury securities because
of rapid growth in Fund assets, and a desire to keep the Fund's average maturity
and duration roughly in line with those of the bond market index in a rapidly
declining interest rate environment. This weighting somewhat dampened returns.
The sharp increase in Fund assets slowed during the third quarter, and the
portfolio currently contains a more normal market-weighting of Treasuries,
mortgages and good quality corporate bonds. The performance of mortgages and
corporate bonds was especially strong during 1995 because of narrowing yield
spreads. A generally healthy economy and strong corporate profits have reduced
investor concerns about credit quality, and quality yield spreads are narrower
than they have been for a number of years.
The Fund had a return of 12.78% in the year ended September 30, 1995, compared
with a return of 14.35% for the Lehman Government/Corporate Bond Index.
[GRAPH]
<TABLE>
<CAPTION>
12/31/87 Sep-88 Sep-89 Sep-90 Sep-91 Sep-92 Sep-93 Sep-94 Sep-95
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Lehman Brothers Government/Corporate Bond Index 10,000 10,656 11,861 12,662 14,672 16,613 18,516 17,750 20,297
First American Fixed Income Fund (Class A POP) 9,625 10,085 11,162 11,921 13,548 15,220 16,621 16,135 18,197
First American Fixed Income Fund (Class A NAV) 10,000 10,478 11,597 12,386 14,076 15,813 17,268 16,764 18,906
</TABLE>
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class B shares on 8/31/94 would have been valued at
$10,496 on 9/30/95 assuming the maximum redemption charge occurs. A $10,000
investment in the Fund's Class C shares on 12/31/87 would have been valued at
$18,920 on 9/30/95.
One Annualized Annualized
Year 5 Year Inception
Return Return To Date
CLASS A NAV 12.78% 8.82% 8.61%
CLASS A POP 8.60% 7.99% 8.08%
CLASS B NAV 11.75% N/A 9.51%
CLASS B CDSC 6.75% N/A 5.11%
CLASS C 12.86% 8.84%* 8.62%*
The inception date of the Class A shares is 12/22/87, the inception date of the
Class B shares is 8/15/94, and the inception date of the Class C shares is
2/4/94.
* Total Returns for periods prior to the inception date of Class C shares
were calculated using synthetic returns since inception of the Class A
shares at NAV. The Annualized Total Return for the Fixed Income Fund Class
C since inception, which is not synthetic, is 5.48%.
INTERMEDIATE GOVERNMENT BOND FUND
In late 1994, the allocation to Federal Agency bonds was increased (particularly
Federal Home Loan Banks) as yield spreads widened relative to Treasuries due to
less participation by traditional Agency buyers. To keep income from the Fund
predominantly exempt from state taxes, the Fund only uses debt of those Agencies
whose interest is exempt from state income taxes (similar to Treasury interest).
The allocation to the Agency sector was allowed to drift lower as the market
rally enticed traditional Agency buyers back in and yield spreads narrowed. The
average maturity of the Fund was marginally longer than its benchmark through
April, and has been neutral since then (although the Fund has moved to slightly
defensive postures at times as the bond rally was viewed as being short term
overbought).
While a defensive posture served the Fund well in late 1994, a more aggressive
stance in favor of the market's upside would have added to already strong
returns this year. At fiscal year-end, the Fund's effective average maturity was
neutral at 3.53 years. For the year ended September 30, 1995, the Fund posted a
total return of 9.82% compared with a return of 10.62% for the slightly broader
Lehman Intermediate-Term Government Bond Index.
[GRAPH]
<TABLE>
<CAPTION>
12/31/87 Sep-88 Sep-89 Sep-90 Sep-91 Sep-92 Sep-93 Sep-94 Sep-95
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
First American Intermediate Government Fund (Class A POP) 9,700 10,114 10,903 11,780 12,990 14,143 14,849 14,681 16,123
Lehman Brothers Intermediate-Term Government Bond Index 10,000 10,575 11,594 12,588 14,298 16,078 17,308 17,048 18,859
First American Intermediate Government Fund (Class A NAV) 10,000 10,426 11,241 12,144 13,392 14,581 15,308 15,135 16,622
</TABLE>
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class C shares on 12/31/87 would have been valued at
$16,621 on 9/30/95.
One Annualized Annualized
Year 5 Year Inception
Return Return To Date
CLASS A NAV 9.82% 6.48% 6.83%
CLASS A POP 6.50% 5.83% 6.41%
CLASS C 9.82% 6.48%* 6.83%*
The inception date of the Class A shares is 12/22/87 and the inception date of
the Class C shares is 2/4/94.
* Total Returns for periods prior to the inception date of Class C shares
were calculated using synthetic returns since inception of the Class A
shares at NAV. The Annualized Total Return for the Intermediate Government
Bond Fund Class C since inception, which is not synthetic, is 4.77%.
MORTGAGE SECURITIES FUND
Mortgage securities have performed well since the bond market rally began in
November 1994. This partially reflects the decline in interest rates all along
the yield curve, but also the generally benign prepayment environment affecting
the underlying mortgage collateral.
During 1993, mortgage prepayments were extraordinarily rapid, causing
mortgage securities to shorten in a rallying bond market when long maturities
and durations were most desirable. Then in 1994, prepayments slowed sharply, and
mortgage duration lengthened as interest rates rose and bond prices fell. During
1995, prepayment accelerated moderately in the second and third quarters, but
the speed-up was very much in line with normal seasonal tendencies. As a result,
the performance of mortgage securities over much of the past year has been in
keeping with their reasonable stable durations in a falling interest rate
environment.
The Fund continues to emphasize securities that are structured to provide stable
cash flows and some protection from the effects of prepayment variations. As a
matter of policy, the portfolio does not hold any leveraged derivative
instruments.
The Fund had a return of 11.84% for the year ended September 30, 1995, compared
with a return of 13.53% on the Lehman Mortgage Securities Index.
[GRAPH]
<TABLE>
<CAPTION>
12/31/92 Sep-93 Sep-94 Sep-95
<S> <C> <C> <C> <C>
First American Mortgage Securities Fund (Class A POP) 9,625 10,326 10,244 11,457
Lehman Brothers Mortgage Index 10,000 10,588 10,468 11,834
First American Mortgage Securities Fund (Class A NAV) 10,000 10,728 10,643 11,903
</TABLE>
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class C shares on 12/31/92 would have been valued at
$11,903 on 9/30/95.
One Annualized
Year Inception
Return To Date
CLASS A NAV 11.84% 6.60%
CLASS A POP 7.62% 5.15%
CLASS C 11.84% 6.60%*
The inception date of the Class A shares is 12/14/92 and the inception date of
the Class C shares is 2/4/94.
* Total Returns for periods prior to the inception date of Class C shares
were calculated using synthetic returns since inception of the Class A
shares at NAV. The Annualized Total Return for the Mortgage Securities Fund
Class C since inception, which is not synthetic, is 5.61%.
FIRST AMERICAN TAX FREE FUNDS
After the bond price decline in the fourth quarter of 1994, which completed a
record down year for bonds as a whole, the municipal market had a brief respite
in early 1995. Then, in mid-April, a series of tax change proposals proceeding
from the Republican electoral successes of November 1994 were made. Each
promised materially lower tax rates on investment income.
Because municipals derive part of their value from their exemption from income
tax, the possibility of lower taxes suggested to investors that municipals would
have to yield more, relative to taxable bonds, to be attractive to investors.
This in turn meant lower municipal prices, and since that time, intermediate and
long-term bonds have underperformed. Money flows into bond funds and individual
bonds have slowed sharply, leaving the casualty insurance companies the only
consistent buyers of tax-exempts. The new issue municipal bond supply, that has
been low for this period, has likely saved municipals from an even greater
relative under performance.
LIMITED TERM TAX FREE INCOME FUND
Although 1994 was especially treacherous for bonds, this Fund proved a safe
haven as one of the few municipal funds in the country to post a positive
return. The Fund was kept short of its benchmark maturity in 1994. However, the
Fund's maturity was extended early in 1995 and has been kept longer than its
index most of this year. The changing municipal market environment provided a
variety of buying opportunities. Many issuers from California suffered from
guilt by association after the Orange County bankruptcy. This allowed the Fund
to accumulate several California positions at attractive levels. Nationwide, a
flight to quality and lowering of insurance premiums due to low supply caused a
relative proliferation of insured deals that also provided the opportunity to
upgrade quality with negligible yield give-up. The Fund also utilized numerous
special situations in areas such as zero coupons, put bonds, and super-sinkers.
The inclusion of these securities should enable the Fund to maintain a yield
advantage over more plain vanilla comparable maturity securities.
For the year ended September 30, 1995, the Fund posted a total return of 5.06%
compared to a return of 5.53% for the Lehman 1-year GO Index. The flight to the
front end caused by both flat tax fears and the potential for a new round of Fed
easing helped the performance of the more "bullet-like" Index relative to the
Funds slightly more laddered portfolio approach. On September 30, the Fund's
effective average maturity was longer than its benchmark at 1.56 years.
[GRAPH]
<TABLE>
<CAPTION>
3/31/94 Sep-94 Sep-95
<S> <C> <C> <C>
First American Limited-Term Tax-Free Income Fund (Class A POP) 9,800 9,918 10,430
First American Limited-Term Tax-Free Income Fund (Class A NAV) 10,000 10,121 10,643
Lehman Brothers 1-Year Index 10,000 10,193 10,757
</TABLE>
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class C shares on 3/31/94 would have been valued at
$10,643 on 9/30/95.
One Annualized
Year Inception
Return To Date
CLASS A NAV 5.16% 4.12%
CLASS A POP 3.19% 2.77%
CLASS C 5.16% 4.12%*
The inception date of the Class A shares is 3/25/94 and the inception date of
the Class C shares is 8/2/94.
* Total Returns for periods prior to the inception date of Class C shares
were calculated using synthetic returns since inception of the Class A
shares at NAV. The Annualized Total Return for the Limited Term Tax Free
Income Fund Class C since inception, which is not synthetic, is 4.67%.
Performance is presented for the period beginning 3/25/94, the date First
Bank National Association became the Adviser of the Limited Term Tax Free
Income Fund. The inception date of the Fund was 2/19/93. The per share
income and capital changes for this Fund since 12/19/92 can be found in the
financial highlights and the prospectus. The average annual total return
figures for one, five and ten year periods (or from inception) are
available upon request.
INTERMEDIATE TAX-FREE FUND
For the fiscal year ending September 30, 1995, the Fund produced a total return
of 9.15%, compared with a return of 10.70% for its benchmark. The Fund's
portfolio was positioned marginally longer as to average maturity than its
7-year reference index during the first half year, and its return for that
period was equal to that of the index. In the second half of the year, however,
the specter of a "flat tax," which might be enacted by this or the next
Congress, had a sharp impact on longer bonds, causing them to advance only
marginally as taxable bond market prices rose. Because the Fund's portfolio is
"laddered," with maturities running from 1-year to over 15, the Fund's longer
holdings suffered. This contrasted with the performance of the reference index,
which contains only 7-year bonds and was thereby protected from the changes
sustained in longer-dated issues. The activity during this period focused on
adding bonds of 4-to-5 year maturity, believing that this area best justifies
available returns with the timing of passage of a possible "flat tax" in 1997
and a phased implementation that might begin the following year. The Fund
continues at this point in time to emphasize 4-to-5 year bonds as representing
the best risk/reward tax-exempt sector. At fiscal year-end, the average maturity
of the Fund was 6.53 years and credit quality was extremely high with 83% of
holdings rated AA or better.
[GRAPH]
<TABLE>
<CAPTION>
12/31/87 Sep-88 Sep-89 Sep-90 Sep-91 Sep-92 Sep-93 Sep-94 Sep-95
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
First American Intermediate Tax-Free Fund (Class A POP) 9,700 10,165 10,660 11,222 12,246 13,131 14,268 14,090 15,379
Lehman Brothers 7-Year G.O. Index 10,000 10,550 11,253 12,029 13,463 14,745 16,377 16,186 17,917
First American Intermediate Tax-Free Fund (Class A NAV) 10,000 10,479 10,989 11,569 12,625 13,537 14,710 14,526 15,855
</TABLE>
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class C shares on 12/31/87 would have been valued at
$15,840 on 9/30/95.
One Annualized Annualized
Year 5 Year Inception
Return Return To Date
CLASS A NAV 9.15% 6.50% 6.18%
CLASS A POP 5.85% 5.85% 5.77%
CLASS C 9.15% 6.50%* 6.18%*
The inception date of the Class A shares is 12/22/87 and the inception date of
the Class C shares is 2/4/94.
* Total Returns for periods prior to the inception date of Class C shares
were calculated using synthetic returns since inception of the Class A
shares at NAV. The Annualized Total Return for the Intermediate Tax Free
Fund Class C since inception, which is not synthetic, is 3.52%.
COLORADO INTERMEDIATE TAX-FREE FUND
For the fiscal year, the Fund produced a total return of 8.57%, compared with
10.70% for its benchmark. The Fund's portfolio structure, its management
activities, and its pattern of return for the fiscal year ended September 30,
1995 were much like those of the Intermediate Tax-Free Fund, and we refer you to
those comments. Bond issuance in Colorado was relatively slow for the fiscal
period; however new issue flow was steadier than in recent years. This is
because Colorado issuers have adjusted to dealing with Proposition 1, the State
Constitutional measure passed in 1992 that imposes limitations upon taxing,
spending and bond issuance by Colorado municipalities. For one, of course,
municipalities have learned to comply with a new set of rules. For another, the
Colorado courts have been active over the last several years in interpreting the
ambiguities offered in Proposition 1, thus removing questions as to the legality
of issuance of certain bond issues. This permitted certain delayed issues to go
forward. The slow issuance limited occasions when opportunistic purchases at
bargain prices might have occurred. At fiscal year-end, the average maturity of
the Fund was 7.07 years and credit quality was extremely high with 81% of
holdings in issues rated AA or better.
[GRAPH]
<TABLE>
<CAPTION>
4/30/94 Sep-94 Sep-95
<S> <C> <C> <C>
Lehman Brothers 7-Year G.O. Index 10,000 10,104 11,185
First American Colorado Intermediate Tax-Free Fund (Class A POP) 9,700 9,814 10,655
First American Colorado Intermediate Tax-Free Fund (Class A NAV) 10,000 10,118 10,985
</TABLE>
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class C shares on 4/30/94 would have been valued at
$10,986 on 9/30/95.
One Annualized
Year Inception
Return To Date
CLASS A NAV 8.57% 8.26%
CLASS A POP 5.36% 6.06%
CLASS C 8.47% 8.26%
The inception date of the Class A and Class C shares is 4/4/94.
MINNESOTA INSURED INTERMEDIATE TAX-FREE FUND
For the fiscal year, the Fund produced a total return of 8.46%, compared with
10.70% for its benchmark. The Fund's portfolio structure, its management
activities and its pattern of return for the fiscal year ended September 30,
1995, were much like those of the Intermediate Tax-Free Fund (please see page
8). The vehicles chosen for purchase and sale, of course, were different, in
that "state-specific" and "insured" as guidelines narrowed the field of
available securities considerably. In addition, Minnesota new-issue tax-exempt
supply was relatively low, limiting the occasions when opportunistic purchases
at bargain prices might have occurred. At fiscal year-end, the portfolio was
strongly positioned in bonds of the highest quality, with 83% of holdings either
AAA-insured or backed by Treasury bonds in escrow. The average maturity of the
Fund stood at 6.38 years.
[GRAPH]
<TABLE>
<CAPTION>
2/28/94 Sep-94 Sep-95
<S> <C> <C> <C>
Lehman Brothers 7-Year G.O. Index 10,000 9,892 10,950
First American Minnesota Insured Intermediate Tax-Free Fund (Class A POP) 9,700 9,557 10,365
First American Minnesota Insured Intermediate Tax-Free Fund (Class A NAV) 10,000 9,852 10,686
</TABLE>
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class C shares at inception on 2/28/94 would have been
valued at $10,685 on 9/30/95.
One Annualized
Year Inception
Return To Date
CLASS A NAV 8.46% 4.11%
CLASS A POP 5.16% 2.14%
CLASS C 8.34% 4.11%
The inception date of the Class A and Class C shares is 2/28/94.
ASSET ALLOCATION FUND
The Fund uses an objective disciplined approach in determining asset allocation,
following the recommended asset weightings produced by a proprietary
quantitative model. The Fund produced a total return of 19.51% for the fiscal
year. These results were in line with the Fund's objective of producing a long
term total return higher than that of the bond market (as represented by the
Lehman Government/Corporate Bond Index with a 1 year total return of 14.35%),
but with volatility lower than that of the equity market (as represented by the
Standard and Poor's 500 Index with a 1 year total return of 29.73%).
During the fiscal year, the quantitative model continued to maintain the
greatest weight in equities, reflecting the model's attractive equity risk
premium. However, as long term interest rates fell during the year, the model
progressively lowered the bond allocation while raising the cash weighting.
The Fund began the year with weightings of 60% Stocks, 21% U.S. Treasury
Obligations, and 19% cash. At the close of the fiscal year, the allocation was
58% stocks, 9% U.S. Treasury Obligations, and 33% cash. The current allocation
suggests that the quantitative model is predicting more modest returns for the
equity market in the near future, with below average returns for bonds.
[GRAPH]
<TABLE>
<CAPTION>
12/31/92 Sep-93 Sep-94 Sep-95
<S> <C> <C> <C> <C>
Standard & Poor's 500 Composite Index 10,000 10,758 10,313 13,379
First American Asset Allocation Fund (Class A NAV) 10,000 10,750 10,945 13,080
Lehman Brothers Government/Corporate Index 10,000 11,138 11,435 13,076
First American Asset Allocation Fund (Class A POP) 9,550 10,266 10,452 12,481
</TABLE>
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class B shares on 8/31/94 would have been valued at
$11,103 on 9/30/95 assuming the maximum redemption charge occurs. A $10,000
investment in the Fund's Class C shares on 12/31/92 would have been valued at
$13,101 on 9/30/95.
One Annualized
Year Inception
Return To Date
CLASS A NAV 19.51% 10.27%
CLASS A POP 14.12% 8.47%
CLASS B NAV 18.51% 16.48%
CLASS B CDSC 13.51% 12.11%
CLASS C 19.75% 10.35%*
The inception date of the Class A shares is 12/14/92, the inception date of
Class B shares is 8/15/94, and the inception date of the Class C shares is
2/4/94.
* Total Returns for periods prior to the inception date of Class C shares
were calculated using synthetic returns since inception of the Class A
shares at NAV. The Annualized Total Return for the Asset Allocation Fund
Class C since inception, which is not synthetic, is 10.92%.
BALANCED FUND
The Fund generated a total return of 20.57% for the fiscal year as compared with
14.35% for the Lehman Government/Corporate Index and 29.73% for the S&P 500. The
Fund return compares favorably to the Lipper Balanced Fund average of 18.99% for
the same period.
At the start of the fiscal year, the Fund had a target mix of 60% equities and
40% fixed income. This mix was gradually shifted to the current allocation of
50% equities, 40% fixed income, and 10% cash. The current slightly conservative
mix reflects the belief that the valuation of both the stock and fixed income
markets are becoming very full.
Equities and fixed income instruments utilized in this Fund mirror those found
in the Stock and Fixed Income Funds. For further discussion of the performance
of these Funds, please review the Fixed Income Fund commentary on page 6 and the
Stock Fund commentary on page 13.
[GRAPH]
<TABLE>
<CAPTION>
12/31/92 Sep-93 Sep-94 Sep-95
<S> <C> <C> <C> <C>
First American Balanced Fund (Class A POP) 9,550 10,484 10,801 13,022
Standard & Poor's 500 Composite Index 10,000 10,758 10,313 13,379
Lehman Brothers Government/Corporate Index 10,000 11,138 11,435 13,076
First American Balanced Fund (Class A NAV) 10,000 10,978 11,310 13,636
</TABLE>
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class B shares on 8/31/94 would have been valued at
$11,159 on 9/30/95 assuming the maximum redemption charge occurs. A $10,000
investment in the Fund's Class C shares on 12/31/92 would have been valued at
$13,680 on 9/30/95.
One Annualized
Year Inception
Return To Date
CLASS A NAV 20.57% 11.96%
CLASS A POP 15.11% 10.14%
CLASS B NAV 19.58% 16.64%
CLASS B CDSC 14.58% 12.27%
CLASS C 20.89% 12.10%*
The inception date of the Class A shares is 12/14/92, the inception date of
Class B shares is 8/15/94, and the inception date of the Class C shares is
2/4/94.
* Total Returns for periods prior to the inception date of Class C shares
were calculated using synthetic returns since inception of the Class A
shares at NAV. The Annualized Total Return for the Balanced Fund Class C
since inception, which is not synthetic, is 11.74%.
EQUITY INDEX FUND
[GRAPH]
<TABLE>
<CAPTION>
12/31/92 Sep-93 Sep-94 Sep-95
<S> <C> <C> <C> <C>
Standard & Poor's 500 Composite Index 10,000 10,758 11,154 14,470
First American Equity Index Fund (Class A NAV) 10,000 10,751 11,100 14,308
First American Equity Index Fund (Class A POP) 9,550 10,267 10,601 13,664
</TABLE>
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class B shares on 8/31/94 would have been valued at
$11,957 on 9/30/95 assuming the maximum redemption charge occurs. A $10,000
investment in the Fund's Class C shares on 12/31/92 would have been valued at
$14,338 on 9/30/95.
One Annualized
Year Inception
Return To Date
CLASS A NAV 28.90% 13.87%
CLASS A POP 23.14% 12.01%
CLASS B NAV 27.87% 24.93%
CLASS B CDSC 22.87% 20.60%
CLASS C 29.17% 13.96%*
The inception date of the Class A shares is 12/14/92, the inception date of
Class B shares is 8/15/94, and the inception date of the Class C shares is
2/4/94.
* Total Returns for periods prior to the inception date of Class C shares
were calculated using synthetic returns since inception of the Class A
shares at NAV. The Annualized Total Return for the Equity Index Fund Class
C since inception, which is not synthetic, is 16.88%.
EQUITY INCOME FUND
The Fund generated a total return of 18.06% during the past fiscal year,
compared with the S&P 500 return of 29.73% and Lehman Government/Corporate Bond
Index return of 14.35%. The equity markets were very favorable for the
technology and healthcare groups in the past year, neither of which were well
represented in the Fund because of their low dividend yields. Similarly, the
Fund's relatively large position in real estate investment trusts (REITs)
produced weak total returns despite relatively favorable operating results. The
Fund's dividend income on a per unit rate has increased about 4.5% compared to
the level of a year ago. In that time period, average bond coupon rates have
declined 1.6% based on the average coupon rate of the Lehman
Government/Corporate Bond Index.
The Fund earned strong returns on its holdings of Pfizer, Johnson & Johnson,
Philip Morris, and American Express in the past year. However, the holdings were
of modest size due to the generally low dividend yields of those issues. Our
holdings of REITs, however, accounted for about 15% of Fund value and performed
relatively poorly compared to a very strong equity market. Since REITs rely on
gains in their rental income streams for the bulk of their returns, there is
little responsiveness to the overall equity market. Cash flow per share rose by
6% to 10% for each of our established REITs. Gains in their cash flows and
dividend payouts met our expectations on average and we continue to hold a
relatively large position. Dividend yields on REITs remain the highest of any
equity group and they are expected to remain a mainstay of the Fund as a means
of enhancing current income. Other relatively high yielding groups performed
well last year, including utilities, energy stocks, and financial services.
[GRAPH]
3/31/94 Sep-94 Sep-95
Standard & Poor's 500 Composite Index 10,000 10,532 13,663
First American Equity Income Fund (Class A NAV) 10,000 10,355 12,225
First American Equity Income Fund (Class A POP) 9,550 9,889 11,675
Lehman Brothers Government/Corporate Index 10,000 9,926 11,350
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class B shares on 8/31/94 would have been valued at
$11,064 on 9/30/95 assuming the maximum redemption charge occurs. A $10,000
investment in the Fund's Class C shares on 3/31/94 would have been valued at
$12,244 on 9/30/95.
One Annualized
Year Inception
Return To Date
CLASS A NAV 18.06% 13.62%
CLASS A POP 12.70% 10.25%
CLASS B NAV 17.10% 15.62%
CLASS B CDSC 12.10% 11.25%
CLASS C 18.24% 13.73%*
The inception date of the Class A shares is 3/25/94, the inception date of the
Class B shares is 8/15/94, and the inception date of the Class C shares is
8/2/94.
* Total Returns for periods prior to the inception date of Class C shares were
calculated using synthetic returns since inception of the Class A shares at
NAV. The Annualized Total Return for the Equity Income Fund Class C since
inception, which is not synthetic, is 15.96%. Performance is presented for the
period beginning 3/25/94, the date First Bank National Association became the
Adviser of the Equity Income Fund. The inception date of the Fund was
12/18/92. The per share income and capital changes for this Fund since
12/18/92 can be found in the financial highlights and the prospectus. The
average annual total return figures for one, five and ten year periods (or
from inception) are available upon request.
LIMITED VOLATILITY STOCK FUND
The Fund manages investment risk by focusing on financially strong companies
which, taken as a whole, provide shareholders with above average dividend
yields, attractive valuations, and the likelihood of improving cash flows. The
Fund's goal is to produce returns matching the Standard & Poor's 500 Stock
Index, but do so with a lower level of volatility. The Fund is designed to
participate in the potential returns available in bull markets while limiting
the downside risk of bear markets to a level below that of the S&P 500.
Since the Fund's inception in November 1994, the Fund has produced a total
return of 21.93%, compared with 29.73% for the S&P 500. Fund performance was
affected as compared with its benchmark, by an underweighting in technology
stocks. In general, technology stocks don't fit the profile of the Fund.
Technology companies typically are large consumers of cash rather than being net
cash generators. And most technology issues are highly volatile issues. While
they frequently soar in bull markets, they often plummet in more bearish
environments. For all these reasons technology exposure was kept at the minimum
level needed to maintain adequate portfolio diversification.
Our focus throughout 1995 was on issues that provided a good combination of
improving fundamentals, modest valuations, and above-average dividend yields.
With these factors in mind, we gradually increased positions in healthcare,
finance, utilities, and energy. These sectors have the added advantage, if
history is any guide, of providing defensive characteristics that should serve
the Fund well if any broad based market correction develops.
[GRAPH]
11/30/94 Sep-95
Standard & Poor's 500 Composite Index 9,700 12,418
First American Limited Volatility Stock Fund 10,000 13,168
Past performance of the Fund is not indicative of future performance.
Annualized Cumulative
Inception Inception
To Date To Date
Class C 25.47% 21.93%
The inception date of the Class C shares is 11/15/94.
DIVERSIFIED GROWTH FUND
The Fund generated a total return of 31.21%, compared with the 29.73% return of
the S&P 500 over the past fiscal year ending September 30, 1995. Relatively
large positions in technology and health care issues accounted for much of the
strong performance by the Fund since those segments have generally led the
overall market in recent months. Since midsummer the Fund has reduced its
holdings of technology issues, but continues to hold about 20% of its assets in
the sector. Healthcare issues now account for about 14% of Fund assets, a slight
increase in recent weeks and somewhat higher than had been the case for most of
the past year. Dividend income has grown modestly in the past year to a per unit
rate about 12% higher than at the end of last fiscal year.
Individual holdings that contributed strongly to performance in the past year
included Cisco Systems, Nokia, Microsoft, Intel, Medtronic, and American
Express. The Fund held all but Microsoft and Intel throughout the year. The
major thrust of the technology weightings was to take advantage of the increases
in capital spending by businesses for communications equipment and desktop
software. However, when the midsummer enthusiasm for Microsoft's coming release
of Windows 95 reached a high point, we sold our holdings of both Microsoft and
Intel at high price levels. Healthcare issues started the year at very modest
valuations but have steadily risen as memory of President Clinton's healthcare
proposals have faded. There are still very strong individual prospects, as
illustrated by the sales and earnings gains driven by Medtronic's new products,
but we are now less comfortable with the valuations of healthcare stocks in
general than at any time in the past two years. We have increased holdings of
financial sector issues in recent months. Restructuring and consolidation remain
very popular themes with management in the banking industry, resulting in
relatively strong profitability and increasing stock values.
[GRAPH]
3/31/94 Sep-94 Sep-95
First American Diversified Growth Fund (Class A NAV) 9,550 9,814 12,877
Standard & Poor's 500 Composite Index 10,000 10,532 13,663
First American Diversified Growth Fund (Class A POP) 10,000 10,276 13,484
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class B shares on 8/31/94 would have been valued at
$12,318 on 9/30/95 assuming the maximum redemption charge occurs. A $10,000
investment in the Fund's Class C shares on 3/31/94 would have been valued at
$13,536 on 9/30/95.
One Annualized
Year Inception
Return To Date
CLASS A NAV 31.21% 19.91%
CLASS A POP 25.28% 16.32%
CLASS B NAV 30.29% 29.58%
CLASS B CDSC 25.29% 25.27%
CLASS C 31.57% 20.21%*
The inception date of the Class A shares is 3/25/94, the inception date of the
Class B shares is 8/15/94, and the inception date of the Class C shares is
8/2/94.
* Total Returns for periods prior to the inception date of Class C shares were
calculated using synthetic returns since inception of the Class A shares at
NAV. The Annualized Total Return for the Diversified Growth Fund Class C since
inception, which is not synthetic, is 29.21%. Performance is presented for the
period beginning 3/25/94, the date First Bank National Association became the
Adviser of the Diversified Growth Fund. The inception date of the Fund was
12/18/92. The per share income and capital changes for this Fund since
12/18/92 can be found in the financial highlights and the prospectus. The
average annual total return figures for one, five and ten year periods (or
from inception) are available upon request.
STOCK FUND
For the fiscal year, the Fund produced a total return of 25.26% compared with a
return of 29.73% for the S&P 500. Issues for this Fund are chosen using a
value-based discipline that attempts to identify companies with improving
fundamentals and a catalyst that, when recognized by investors, should help the
stock appreciate to its fair value.
The Fund had a heavy emphasis on cyclical and technology companies, areas that
are anticipated to have significant profit potential whether from the
competitive restructuring of American industry or the extended expansion of the
global economy. Catalysts prevalent among the companies in these sectors include
dramatic cost cutting (James River, Hercules, Case, and Times Mirror), changes
in management and operating cultures (IBM, Scott Paper, Cray Research, and
Eastman Kodak), and the targeting of international opportunities (General
Electric, Xerox, Whirlpool, and Hewlett Packard).
Performance was dampened somewhat as a result of the emphasis on cyclical issues
that were negatively impacted by fears of a temporary economic slowdown. These
fears overshadowed the long-term improving fundamentals. The Fund is well
positioned and the prospects are compelling for all the current holdings based
upon their current undervaluation, increased earnings potential, catalysts, and
capable shareholder-oriented managements.
[GRAPH]
<TABLE>
<CAPTION>
12/31/87 Sep-88 Sep-89 Sep-90 Sep-91 Sep-92 Sep-93 Sep-94 Sep-95
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
First American Stock Fund (Class A POP) 9,550 10,021 12,508 11,576 14,545 15,688 18,170 19,689 24,663
Standard & Poor's 500 Composite Index 10,000 11,312 15,044 13,654 17,911 19,891 22,476 23,303 30,232
First American Stock Fund (Class A NAV) 10,000 10,494 13,097 12,121 15,231 16,428 19,027 20,617 25,825
</TABLE>
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class B shares on 8/31/94 would have been valued at
$11,529 on 9/30/95 assuming the maximum redemption charge occurs. A $10,000
investment in the Fund's Class C shares on 12/31/87 would have been valued at
$25,875 on 9/30/95.
One Annualized Annualized
Year 5 Year Inception
Return Return To Date
CLASS A NAV 25.26% 16.33% 13.05%
CLASS A POP 19.61% 15.27% 12.38%
CLASS B NAV 24.20% N/A 20.76%
CLASS B CDSC 19.20% N/A 16.41%
CLASS C 25.50% 16.37% 13.07%*
The inception date of the Class A shares is 12/22/87, the inception date of the
Class B shares is 8/15/94, and the inception date of the Class C shares is
2/4/94.
* Total Returns for periods prior to the inception date of Class C shares were
calculated using synthetic returns since inception of the Class A shares at
NAV. The Annualized Total Return for the Stock Fund Class C since inception,
which is not synthetic, is 15.92%.
SPECIAL EQUITY
Over the past fiscal year ending September 30, 1995, the Fund generated a total
return of 12.63% compared with the 29.73% return of the S&P 500. The Fund's
relatively weak performance reflected in part the Fund's investments in the
aluminum and metals sector that generated good returns in 1994 but failed to
outperform the broad market indices in the current year. After rising strongly
in 1994, many commodity metal prices declined on balance in 1995. The share
prices of the aluminum and other metal equities tended to mirror this pattern.
Several of the investment positions in this area were sharply reduced during the
most recent quarter.
Partly offsetting this disappointing area were the Fund's investments in a
number of medium capitalization companies. Within this group, Stolt-Nielsen, the
parcel shipping company, reported a sharp improvement in utilization rates and
in shipping rates and appreciated in price by approximately 40 percent. Other
medium capitalization issues that performed well included Aydin Inc., Brown &
Sharpe, Oshkosh Truck, and Pioneer Hi-Bred International. Brown & Sharpe, after
struggling for many years, has successfully expanded its base of sales in
measurement coordinate equipment and now appears to be in a position to generate
good earnings off a sizeable sales base. Another company, Wiser Oil, which the
Fund purchased recently, has in the past year completed the acquisition of
several oil and gas properties that are expected to yield rising production
volumes and cash flow for the company over the next several years. Despite the
relatively weak performance of the current year, the Fund continues to
outperform its benchmark on a 3 and 5 year basis and continues to search for
investment opportunities in individual issues which have promising prospects and
which have limited downside price risk.
[GRAPH]
<TABLE>
<CAPTION>
12/31/87 Sep-88 Sep-89 Sep-90 Sep-91 Sep-92 Sep-93 Sep-94 Sep-95
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
First American Special Equity Fund (Class A POP) 9,550 11,223 13,275 11,942 14,829 17,078 20,308 24,105 27,150
Standard & Poor's 500 Composite Index 10,000 11,312 15,044 13,654 17,911 19,891 22,476 23,303 30,232
First American Special Equity Fund (Class A NAV) 10,000 11,752 13,901 12,505 15,527 17,883 21,265 25,241 28,429
</TABLE>
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class B shares on 8/31/94 would have been valued at
$10,802 on 9/30/95 assuming the maximum redemption charge occurs. A $10,000
investment in the Fund's Class C shares on 12/31/87 would have been valued at
$28,494 on 9/30/95.
One Annualized Annualized
Year 5 Year Inception
Return Return To Date
CLASS A NAV 12.63% 17.85% 14.44%
CLASS A POP 7.53% 16.77% 13.77%
CLASS B NAV 11.64% N/A 15.37%
CLASS B CDSC 6.64% N/A 11.00%
CLASS C 12.84% 17.90%* 14.48%*
The inception date of the Class A shares is 12/22/87, the inception date of the
Class B shares is 8/15/94, and the inception date of the Class C shares is
2/4/94.
* Total Returns for periods prior to the inception date of Class C shares were
calculated using synthetic returns since inception of the Class A shares at
NAV. The Annualized Total Return for the Special Equity Fund Class C since
inception, which is not synthetic, is 12.28%.
REGIONAL EQUITY FUND
For the fiscal year ending September 30, 1995, the Fund produced a total return
of 41.17% compared with a return of 23.38% for the Russell 2000 Index.
The Fund invests primarily in equity securities of small companies headquartered
in the Upper Midwest. Investment decisions are made using a disciplined
bottom-up approach focusing on companies whose stocks are undervalued due to low
name recognition among investors; which have experienced, shareholder-oriented
management teams and company-specific fundamentals that grow shareholder value.
This approach has generated above average returns with below average risk.
Stocks that were important contributors to the Funds' performance include
Aetrium, BMC Industries, and TCF Financial. The portfolio is currently focused
on technology, consumer cyclical, and healthcare stocks.
[GRAPH]
<TABLE>
<CAPTION>
12/31/92 Sep-93 Sep-94 Sep-95
<S> <C> <C> <C> <C>
First American Regional Equity Fund (Class A POP) 9,550 11,142 11,895 16,792
Frank Russell 2000 Stock Index 10,000 11,585 11,894 14,675
First American Regional Equity Fund (Class A NAV) 10,000 11,667 12,456 17,583
</TABLE>
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class B shares on 8/31/94 would have been valued at
$13,449 on 9/30/95 assuming the maximum redemption charge occurs. A $10,000
investment in the Fund's Class C shares on 12/31/92 would have been valued at
$17,612 on 9/30/95.
One Annualized
Year Inception
Return To Date
CLASS A NAV 41.17% 23.68%
CLASS A POP 34.81% 21.67%
CLASS B NAV 39.98% 38.07%
CLASS B CDSC 34.98% 33.80%
CLASS C 41.40% 23.78%*
The inception date of the Class A shares is 12/14/92, the inception date of the
Class B shares is 8/15/94, and the inception date of the Class C shares is
2/4/94.
* Total Returns for periods prior to the inception date of Class C shares were
calculated using synthetic returns since inception of the Class A shares at
NAV. The Annualized Total Return for the Regional Equity Fund Class C since
inception, which is not synthetic, is 24.42%.
EMERGING GROWTH FUND
The Fund generated a total return of 28.82% during the past fiscal year ending
September 30, 1995, compared with a return of 23.38% for the Russell 2000 Stock
Index. Small companies underperformed the broader market averages for much of
the past year, but have shown signs of better performance since midsummer. In
periods of strong corporate profits, the larger capitalization issues have
generally been the market leaders. Conversely, with slower growth, such as the
second and third quarters of 1995, the market becomes more selective and smaller
capitalization issues fare better. The Fund's strongest market sectors were the
healthcare and technology groups, but results were widely variable within those
groups.
The strongest performers for the Fund included Idexx Labs, Target Therapeutics,
Tellabs, Fritz, and Molten Metal Technology. These companies illustrate the
Fund's investment emphasis on smaller capitalization companies that are expected
to grow rapidly for some years to come. The Fund prefers companies that operate
in niche markets that require specialized expertise. In addition, the Fund
broadly diversifies its holdings among market sectors and the industries that
comprise them. It will avoid overly concentrating in any single group, such as
technology, despite the near term allure of a hot market. Going forward, despite
a slower growth rate for the economy as a whole, economic conditions remain
favorable for smaller companies. The current environment favors rapidly changing
markets, and smaller companies are particularly adept at moving with their
markets. With a constant flow of newer companies coming along to replace those
that appreciate through the top of the Fund's size constraints (based on market
capitalization) there are adequate opportunities for performance in the future.
[GRAPH]
4/30/94 Sep-94 Sep-95
First American Emerging Growth Fund (Class A POP) 9,550 10,000 12,883
Frank Russell 2000 Stock Index 10,000 10,217 12,605
First American Emerging Growth Fund (Class A NAV) 10,000 10,472 13,490
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class B shares on 8/31/94 would have been valued at
$12,467 on 9/30/95 assuming the maximum redemption charge occurs. A $10,000
investment in the Fund's Class C shares on 4/30/94 would have been valued at
$13,501 on 9/30/95.
One Annualized
Year Inception
Return To Date
CLASS A NAV 28.82% 23.15%
CLASS A POP 23.01% 19.41%
CLASS B NAV 27.89% 31.76%
CLASS B CDSC 22.89% 27.46%
CLASS C 29.16% 23.21%
The inception date of the Class A and Class C shares is 4/4/94, and the
inception date of the Class B shares is 8/15/94.
TECHNOLOGY FUND
In fiscal year 1995, the First American Technology Fund produced a total
return of 66.22% versus 56.25% for the Lipper Science and Technology Funds
Average. The Fund profited from dramatic gains in the semiconductor industry,
client/server software, and telecommunications equipment companies. Big winners
included Micron Technology, Applied Materials, and LSI logic in semiconductors;
Informix and Peoplesoft in client/server software; and Nokia, Tellabs, and
Ascend Communications in Telecommunications Equipment.
Positions in semiconductors companies have recently been reduced in anticipation
of a maturing of that cycle, next year. There should be a considerable increase
in semiconductor availability and some pricing relief. This will lead to a
significant expansion of business for consumers of semiconductors, from Personal
Computer companies such as Compaq, to telecommunications equipment companies
like General Instruments, to Internet related plays like US Robotics. Just as
stocks of many semiconductor consuming companies like Compaq have done well
during times of rising component costs, it is possible for semiconductor
producing companies like Applied Materials to make money during times of lower
chip pricing. Therefore, we remain optimistic and fully invested, although
cautious of volatility. In the meantime, the Fund's below average exposure to
semiconductors may lead to returns that deviate more broadly from the Lipper
Index.
The average Fund holding is producing earnings growth in excess of 50%, so the
relative valuation of stock holdings has actually declined over the past year.
Current levels of profitability are not necessarily sustainable, so the Fund
continues to look for new names and add to positions that have not moved as
dramatically as the market. The largest holdings in the Fund are Informix,
Oracle, Cisco, Texas Instruments, Compaq, and Nokia.
[GRAPH]
4/30/94 Sep-94 Sep-95
First American Technology Fund (Class A POP) 9,550 11,051 18,369
First American Technology Fund (Class A NAV) 10,000 11,572 19,235
Lipper Science & Technology Funds Average 10,000 10,743 16,785
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class B shares on 8/31/94 would have been valued at
$16,796 on 9/30/95 assuming the maximum redemption charge occurs. A $10,000
investment in the Fund's Class C shares on 4/30/94 would have been valued at
$19,255 on 9/30/95.
One Annualized
Year Inception
Return To Date
CLASS A NAV 66.22% 51.65%
CLASS A POP 58.70% 47.04%
CLASS B NAV 64.52% 73.99%
CLASS B CDSC 59.52% 69.85%
CLASS C 66.22% 51.65%
The inception date of the Class A and Class C shares is 4/4/94, and the
inception date of the Class B shares is 8/15/94.
INTERNATIONAL FUND
For the fiscal year ending September 30, 1995, the Fund generated a total return
of 0.69% as compared to the return of 5.74% for the Morgan Stanley's Europe,
Australia and Far East (EAFE) Index.
Several factors materially affected the portfolio's performance during the past
fiscal year. The major negative was the Mexican Peso devaluation of December
1994, which adversely affected the markets of Latin America and Southeast Asia.
The positive factors were the resurgence of the Japanese market, the continuing
good performance of our selected European stocks and the Fund's ability to
hedge. Most recently the Fund benefited from currency declines in the yen and
deutsche mark.
The current investment strategy is bullish. The environment for long-term
financial assets around the world continues to be favorable because the world's
liquidity cycle is still very positive. The major economies are either sluggish
or slowing, inflation continues to ebb, and the central banks are tending toward
ease. Excess liquidity is thus being created and it will find its way into
financial assets. Also, the world markets are desynchronized. The U.S. market
(and economy) has led the parade, while Japan is just emerging from an extended
bear phase. The European markets have been doing reasonably well, while the
emerging markets have been in a correction.
The Funds investments in 1994 were a continuation of the philosophy to invest in
growth at good relative value. This resulted in a significant allocation to the
Latin American and Southeast Asian markets. The reasoning was based on the
belief that this area offered the best opportunity for capital appreciation
given the impetus in these economies for market oriented solutions to economic
problems. The Mexican devaluation in December shocked financial markets and
threw these ideas into question. The Fund's investment and conviction in the
viability of this area was put to a severe test and performance suffered. As the
dust settled, however, it became evident that the Mexican problem was not
endemic. The fundamental growth story of the Pacific Rim and Latin America
remains largely intact. Fresh capital inflows are putting downward pressure on
interest rates, external debt is falling, and growth continues to be the
strongest and most consistent in the world. Despite recent rallies, the markets
are cheap -- multiples of projected earnings are roughly equal to or less than
forecast earnings per share growth rates.
Europe presents a mixed picture. The economies remain sluggish but the markets
have reacted positively to the first harbingers of ease by the central banks (in
particular the Bundes bank). The European focus continues to be on global growth
companies in the telecommunications, pharmaceutical, interest sensitive, and
consumer areas.
Japan, at long last, appears to be resolving its problems, and may be the best
of the big developed markets. Recent actions indicate that the authorities have
belatedly recognized the severity of the deflationary cycle and are taking
action to stimulate the economy. The decline of the yen has been an important
first step. Fiscal stimulus is the second step. If successful, the Japanese
recovery could show some real growth in 1996. Increased weightings in Japan
remain focused on technology-related stocks, especially in the
telecommunications industry, an area the Fund favors worldwide. Hedging yen
currency positions have enabled the Fund to participate in the recent market
rally without any currency offset.
As for the emerging markets, the combination of a stronger dollar and weaker yen
should be a major positive for this area, particularly the Pacific Rim. Growth
continues to be the strongest and most consistent in the world and, best of all,
the markets are cheap. The Fund continues to focus investment in this area as
the premier "growth" area of the world.
[GRAPH]
4/30/94 Sep-94 Sep-95
First American International Equity Fund (Class A POP) 9,550 9,587 9,653
Morgan Stanley EAFE Index 10,000 10,097 10,677
First American International Equity Fund (Class A NAV) 10,000 10,039 10,108
Past performance of the Fund is not indicative of future performance. A $10,000
investment in the Fund's Class B shares on 8/31/94 would have been valued at
$9,215 on 9/30/95 assuming the maximum redemption charge occurs. A $10,000
investment in the Fund's Class C shares on 4/30/94 would have been valued at
$10,128 on 9/30/95.
One Annualized
Year Inception
Return To Date
CLASS A NAV 0.69% 2.02%
CLASS A POP -3.84% -1.10%
CLASS B NAV -0.10% -0.26%
CLASS B CDSC -5.09% -4.70%
CLASS C 0.78% 2.00%
The inception date of the Class A shares is 4/7/94, the inception date of the
Class B shares is 8/15/94, and the inception date of the Class C shares is
4/4/94.
REAL ESTATE SECURITIES FUND
The Fund's strategy is to provide above average current income and long term
capital appreciation by investing primarily in equity securities of real estate
companies. Since its inception on June 30, 1995, the Fund has generated a total
return of 5.19% which compares favorably with the 5.06% return for the Lipper
Real Estate Fund Average.
The Fund's performance benefited from overweighting the Healthcare and
Office/Industrial Self Storage sectors and underweighting Retail. This
performance was achieved despite very little exposure to the Hotel sector, which
posted the strongest performance of the equity REIT universe.
The Fund is most heavily weighted in the Office/Industrial Self Storage and
Residential sectors, in the belief that these offer the greatest potential for
growth and improving fundamentals. Some of the Fund's largest holdings include
Spieker Properties, Cali Realty, and Equity Residential Properties.
[GRAPH]
6/30/95 Sep-95
First American Real Estate Securities Fund (Class C) 10,000 10,519
Lipper Real Estate Funds Average 10,000 10,475
Past performance of the Fund is not indicative of future performance.
Annualized Cumulative
Inception Inception
To Date To Date
Class C 22.23% 5.19%
The inception date for the Class C shares is 6/30/95.
STATEMENT OF NET ASSETS----SEPTEMBER 30, 1995
PRIME OBLIGATIONS FUND
Description Par (000) Value (000)
COMMERCIAL PAPER--44.8%
Aes Shady Point (LOC: Bank of Tokyo)
5.863%, 10/16/95 $41,000 $40,900
Asset Securitization
5.760%, 11/02/95 (B) 14,800 14,725
Banco Real S.A.
(LOC: Barclays Bank)
5.942%, 10/23/95 7,000 6,975
Blue Hawk Funding
5.812%, 10/03/95 (B) 10,045 10,042
5.813%, 10/12/95 (B) 4,240 4,233
5.777%, 10/13/95 (B) 9,334 9,316
5.799%, 10/13/95 (B) 6,202 6,190
5.810%, 10/13/95 (B) 4,741 4,732
5.780%, 10/16/95 (B) 13,207 13,175
5.810%, 10/24/95 (B) 15,573 15,515
5.807%, 10/25/95 (B) 5,151 5,131
5.808%, 10/25/95 (B) 4,884 4,865
5.816%, 10/27/95 (B) 11,066 11,020
5.812%, 10/31/95 (B) 16,806 16,725
Credit Card Securitization
5.818%, 10/19/95 (B) 9,219 9,193
5.880%, 10/20/95 (B) 15,987 15,938
Crown Leasing USA
(LOC: Bank of Tokyo)
5.899%, 10/05/95 (B) 21,800 21,786
5.848%, 10/18/95 (B) 15,000 14,959
5.929%, 10/25/95 (B) 20,000 19,921
CS First Boston
5.787%, 10/30/95 5,000 4,977
DIC Americas (LOC: Mitsubishi Bank)
5.848%, 10/11/95 18,000 17,971
5.826%, 10/12/95 11,500 11,480
5.850%, 10/23/95 7,000 6,975
Distribution Funding
5.799%, 10/02/95 (B) 12,000 11,998
5.784%, 10/20/95 (B) 5,540 5,523
5.823%, 11/03/95 (B) 15,000 14,921
5.820%, 11/08/95 (B) 7,965 7,916
5.805%, 11/09/95 (B) 5,350 5,317
5.793%, 11/10/95 (B) 15,000 14,904
5.810%, 11/15/95 (B) 9,200 9,134
5.771%, 12/13/95 (B) 10,000 9,884
Enterprise Funding
5.809%, 10/05/95 (B) 12,500 12,492
5.810%, 10/20/95 (B) 8,031 8,007
5.789%, 10/26/95 (B) 11,880 11,833
5.791%, 10/27/95 (B) 7,539 7,508
5.820%, 10/31/95 (B) 10,000 9,952
5.811%, 11/17/95 (B) 15,097 14,984
5.755%, 11/21/95 (B) 19,174 19,019
5.862%, 12/21/95 (B) 10,109 9,978
Equipment Funding
5.804%, 10/04/95 (B) 19,129 19,120
5.806%, 10/06/95 (B) 15,059 15,047
5.816%, 10/06/95 (B) 23,676 23,657
Equipment Intermediation Partnership
5.834%, 11/03/95 (B) $26,153 $26,014
5.799%, 11/06/95 (B) 5,061 5,032
5.819%, 11/07/95 (B) 7,441 7,397
Fleet Funding
5.812%, 10/12/95 (B) 25,934 25,888
5.809%, 10/19/95 (B) 10,156 10,127
Hahn Issuing (LOC: Citibank)
5.815%, 10/19/95 11,530 11,497
5.814%, 10/24/95 12,700 12,653
International Securitization
(Guarantor: FNB Chicago)
5.857%, 10/16/95 (B) 7,775 7,756
5.779%, 10/27/95 (B) 16,180 16,113
5.831%, 10/30/95 (B) 15,000 14,931
5.832%, 10/30/95 (B) 25,000 24,884
5.831%, 10/31/95 (B) 6,650 6,618
5.812%, 12/04/95 (B) 10,105 10,002
5.817%, 01/31/96 (B) 11,480 11,258
5.831%, 02/15/96 (B) 10,230 10,008
Jefferson Smurfit Financial
6.317%, 10/03/95 (B) 11,000 10,996
5.760%, 11/07/95 (B) 8,000 7,953
5.781%, 11/29/95 (B) 7,100 7,034
Konica Financial USA
(LOC: Mitsubishi Bank)
5.847%, 10/10/95 (B) 7,000 6,990
Mitchell Funding (LOC: Swiss Bank)
6.453%, 10/02/95 40,000 39,993
Orix America (LOC: Sanwa Bank)
5.930%, 10/02/95 (B) 25,000 24,996
Pemex Capital (LOC: Credit Suisse)
5.838%, 10/26/95 10,000 9,960
5.751%, 11/17/95 15,000 14,888
5.778%, 11/17/95 10,000 9,925
Pemex Capital (LOC: Swiss Bank)
5.886%, 10/05/95 10,000 9,994
Petroleo Brasileiro
(LOC: Barclays Bank)
5.856%, 12/20/95 10,000 9,872
5.862%, 12/27/95 8,000 7,889
5.866%, 01/03/96 10,000 9,850
Pooled Accounts Receivable Capital
5.827%, 10/05/95 (B) 15,370 15,360
5.797%, 10/20/95 (B) 20,000 19,939
5.846%, 10/26/95 (B) 30,000 29,879
5.805%, 11/09/95 (B) 10,235 10,171
Pooled Certificate (Guarantor: FGIC)
5.832%, 10/06/95 (B) 10,237 10,229
5.819%, 10/11/95 (B) 6,044 6,034
5.819%, 10/18/95 (B) 13,148 13,112
Premium Funding
5.751%, 12/07/95 (B) 30,378 30,057
Prospect Street Senior Portfolio
(Guarantor: FSA)
5.830%, 10/02/95 (B) $ 7,037 $ 7,036
6.044%, 10/02/95 (B) 4,267 4,266
5.820%, 10/11/95 (B) 2,041 2,038
5.813%, 10/17/95 (B) 2,023 2,018
5.848%, 10/19/95 (B) 3,226 3,217
5.808%, 10/26/95 (B) 6,783 6,756
5.808%, 10/26/95 (B) 6,783 6,756
5.806%, 11/10/95 (B) 3,990 3,965
5.815%, 12/01/95 (B) 4,121 4,081
Receivables Capital
5.814%, 10/04/95 (B) 10,000 9,995
5.818%, 10/16/95 (B) 10,000 9,976
5.763%, 10/17/95 (B) 30,000 29,924
5.829%, 10/25/95 (B) 15,000 14,942
5.790%, 10/26/95 (B) 22,771 22,680
Ryobi Financial (LOC: Mitsubishi Bank)
5.853%, 10/17/95 7,100 7,082
SRD Financial (LOC: Bank of Tokyo)
5.826%, 10/12/95 15,000 14,973
Towson Town Center
(LOC: Mitsubishi Bank)
5.826%, 10/06/95 7,556 7,550
5.832%, 10/18/95 4,500 4,488
5.829%, 10/20/95 11,462 11,427
UBS Financial
6.453%, 10/02/95 50,000 49,991
6.453%, 10/02/95 50,000 49,991
US Prime Property (LOC: Westpac Bank)
5.891%, 10/10/95 11,000 10,984
5.762%, 11/29/95 15,000 14,860
5.774%, 12/08/95 20,000 19,785
5.774%, 12/08/95 9,000 8,903
TOTAL COMMERCIAL PAPER
(Cost $1,350,921) 1,350,921
CORPORATE OBLIGATIONS--20.4%
Bear Stearns
5.925%, 10/04/95 (A) 50,000 50,000
Beta Finance
5.960%, 10/02/95 (A) 60,000 60,000
Ford Motor Credit
8.625%, 04/15/96 20,000 20,282
9.100%, 07/05/96 10,000 10,233
General Electric Capital
6.000%, 10/02/95 (A) 25,000 24,996
6.070%, 10/02/95 (A) 50,000 49,985
Goldman Sachs Group
6.437%, 10/13/95 20,000 20,000
6.562%, 12/19/95 10,000 10,000
5.750%, 02/06/96 25,000 25,000
5.750%, 04/08/96 25,000 25,000
5.875%, 06/04/96 20,000 20,000
Household Finance
10.090%, 03/21/96 5,000 5,093
Merrill Lynch
6.050%, 08/19/96 $35,000 $ 35,000
Securitized Triple A Receivables Trust
6.113%, 10/20/95 (A) (B) 12,500 12,515
Structured Enhanced Return Trust 1994
T-1
5.906%, 10/13/95 (A) (B) 50,000 49,981
Structured Enhanced Return Trust 1994
A-5
5.862%, 10/25/95 (A) (B) 47,000 46,997
Structured Enhanced Return Trust 1995
A-17
6.063%, 10/02/95 (A) (B) 50,000 50,000
Structured Enhanced Return Trust 1995
A-18
5.862%, 10/16/95 (B) 25,000 24,996
Sun Life Insurance of America
6.250%, 10/02/95 (A) 75,000 75,001
TOTAL CORPORATE OBLIGATIONS
(Cost $615,079) 615,079
LOAN PARTICIPATION CERTIFICATES--12.2%
Barclays Bank
(Cargill Financial Services)
5.810%, 10/10/95 25,000 25,000
5.810%, 10/18/95 25,000 25,000
Barclays Bank
(Cargill Incorporated)
6.500%, 10/02/95 25,000 25,000
5.780%, 10/17/95 15,000 15,000
5.780%, 10/19/95 15,000 15,000
Barclays Bank (Morgan Stanley)
6.600%, 10/02/95 50,000 50,000
Barclays Bank PLC
(National Rural Utilities)
5.810%, 10/02/95 20,000 20,000
5.800%, 10/25/95 15,000 15,000
5.800%, 10/27/95 17,000 17,000
CoreStates Bank (Aon Corporation)
5.820%, 10/04/95 13,000 13,000
CoreStates Bank (Weyerhauser Mortgage)
5.850%, 10/16/95 60,310 60,310
Toronto Dominion Bank
(Bell Atlantic Financial Services)
5.770%, 10/03/95 7,000 7,000
Toronto Dominion Bank (ITT Hartford)
5.810%, 10/16/95 10,000 10,000
Toronto Dominion Bank (Morgan Stanley)
5.900%, 10/02/95 20,000 20,000
6.600%, 10/02/95 50,000 50,000
TOTAL LOAN PARTICIPATION CERTIFICATES
(Cost $367,310) 367,310
U.S. GOVERNMENT AGENCY OBLIGATIONS--6.6%
Export-Import Bank
5.935%, 10/15/95 (A) 70,455 70,443
Export-Import Bank/KA leasing
5.895%, 10/15/95 (A) $ 36,163 $ 36,163
FHLB
6.200%, 10/05/95 (A) 25,000 25,018
6.330%, 10/02/95 (A) 25,000 25,041
FNMA
6.150%, 10/02/95 (A) 20,000 19,998
SLMA
5.640%, 10/03/95 (A) 11,150 11,140
5.640%, 10/03/95 (A) 10,000 9,995
U.S. AID
5.900%, 10/03/95 (A) 1,250 1,248
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS
(Cost $199,046) 199,046
ASSET BACKED SECURITIES--3.3%
CARCO Auto Loan Master Trust 1993-2 A1
5.901%, 10/16/95 (A) 63,500 63,500
Money Market Auto Loan Trust
6.005%, 10/16/95 (A) 36,050 36,060
TOTAL ASSET BACKED SECURITIES
(Cost $99,560) 99,560
CERTIFICATES OF DEPOSIT--1.6%
Mercantile Safe Deposit & Trust
5.956%, 10/09/95 (A) 30,000 30,000
5.956%, 10/09/95 (A) 20,000 20,000
TOTAL CERTIFICATES OF DEPOSIT
(Cost $50,000) 50,000
MASTER NOTES--0.6%
Associates Corporation of North America
5.708%, 10/02/95 (C) 14,617 14,617
Goldman Sachs
5.830%, 10/03/95 (C) 3,569 3,569
TOTAL MASTER NOTES
(Cost $18,186) 18,186
REPURCHASE AGREEMENTS--10.6%
Daiwa Securities 6.450%, dated
09/29/95, matures 10/02/95,
repurchase price $100,053,750
(collateralized by various U.S.
Treasury Bonds, total par value
$74,635,000, 7.250%-12.750%,
11/15/10-05/15/16: total market value
$102,825,062) 100,000 100,000
Salomon Brothers 6.450%, dated
09/29/95, matures 10/02/95,
repurchase price $220,582,698,
(collateralized by various FHLMC and
FNMA Bonds, total par value
$220,464,198, 4.950%-17.759%,
11/01/99-10/01/25: total market value
$230,959,617) 220,464 220,464
TOTAL REPURCHASE AGREEMENTS
(Cost $320,464) 320,464
TOTAL INVESTMENTS--100.1%
(Cost $3,020,566) 3,020,566
OTHER ASSETS AND LIABILITIES--(0.1%)
Other Assets and Liabilities, Net $ (3,679)
NET ASSETS:
Portfolio shares--Institutional Class ($.01 par
value--20 billion authorized) based on
2,911,050,562 outstanding shares 2,911,050
Portfolio shares--Retail Class A ($.01 par
value--20 billion authorized) based on 96,082,889
outstanding shares 96,083
Portfolio shares--Retail Class B ($.01 par
value--20 billion authorized) based on 13,694
outstanding shares 14
Portfolio shares--Corporate Trust Class
($.01 par value--20 billion authorized) based on
9,735,192 outstanding shares 9,735
Accumulated net realized gain on investments 5
TOTAL NET ASSETS:--100.0% $3,016,887
NET ASSET VALUE, OFFERING PRICE, AND
REDEMPTION PRICE PER SHARE--INSTITUTIONAL CLASS $ 1.00
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE--RETAIL CLASS A $ 1.00
NET ASSET VALUE AND OFFERING
PRICE PER SHARE--RETAIL CLASS B (1) $ 1.00
NET ASSET VALUE AND OFFERING PRICE,
AND REDEMPTION PRICE PER SHARE--CORPORATE TRUST CLASS $ 1.00
The accompanying notes are an integral part of the financial statements.
(1) Retail Class B has a contingent deferred sales charge. For a description of
possible redemption charge, see the notes to the financial statements.
(A) Variable Rate Security--the rate reported on the Statement of Net Assets is
the rate in effect as of September 30, 1995. The date shown is the reset
date.
(B) Securities sold within the terms of a private placement memorandum, exempt
from registration under Section 4(2) or 144A of the Securities Act of 1933,
as amended, and may be sold only to dealers in that program or other
"accredited investors". These securities have been determined to be liquid
under guidelines established by the Board of Directors.
(C) Variable Rate Security with Demand Features--the rate reported on the
Statement of Net Assets is the rate as of September 30, 1995. The date
shown is the longer of the reset or demand date.
AID--Agency for International Development
FGIC--Financial Guaranty Insurance Company
FSA--Financial Security Assurance
FHLB--Federal Home Loan Bank
FHLMC--Federal Home Loan Mortgage Corporation
FNMA--Federal National Mortgage Association
LOC--Letter of Credit
SLMA--Student Loan Marketing Association
GOVERNMENT OBLIGATIONS FUND
Description Par (000) Value (000)
U.S. GOVERNMENT AGENCY OBLIGATIONS--46.1%
Export-Import Bank
5.875%, 10/16/95 (A) (B) $25,000 $25,000
5.895%, 10/16/95 (A) (B) 18,199 18,199
5.935%, 10/16/95 (A) (B) 30,000 29,995
FHLB
6.040%, 10/02/95 (A) 13,000 12,957
6.250%, 10/05/95 (A) 25,000 25,076
5.753%, 12/04/95 20,000 19,969
FHLMC
6.170%, 10/05/95 (A) 15,000 15,004
FNMA
5.710%, 10/25/95 34,550 34,420
5.673%, 01/29/96 20,000 19,633
5.772%, 05/13/96 20,000 19,309
5.825%, 05/13/96 10,000 9,651
SLMA
5.480%, 10/03/95 (A) 10,000 10,000
5.480%, 10/03/95 (A) 20,000 20,000
5.550%, 10/03/95 (A) 14,000 13,905
5.640%, 10/03/95 (A) 15,000 15,000
U.S. AID
5.740%, 10/03/95 (A) 8,000 8,019
5.740%, 10/03/95 (A) 11,000 11,000
5.740%, 10/03/95 (A) 13,000 13,000
5.764%, 10/03/95 (A) 15,000 15,000
5.774%, 10/03/95 (A) 10,000 9,987
5.790%, 10/03/95 (A) 1,000 1,000
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS
(Cost $346,124) 346,124
OTHER U.S. GOVERNMENT OBLIGATIONS--13.8%
Downey Savings & Loan (LOC: Federal
Home Loan Bank of San Francisco)
6.273%, 10/10/95 25,000 24,963
5.657%, 01/16/96 20,000 19,673
5.682%, 04/12/96 10,000 9,706
5.733%, 05/28/96 15,000 14,450
Fidelity Federal Bank, NSB (LOC:
Federal Home Loan Bank of San
Francisco)
5.755%, 11/28/95 15,000 14,862
5.757%, 11/30/95 20,000 19,810
TOTAL OTHER U.S. GOVERNMENT OBLIGATIONS
(Cost $103,464) 103,464
U.S. TREASURY OBLIGATIONS--2.0%
U.S. Treasury Bill
5.567%, 01/18/96 $ 15,000 $ 14,754
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $14,754) 14,754
REPURCHASE AGREEMENT--38.3%
Bear Stearns 6.150%, dated 09/29/95, matures
10/02/95, repurchase price $150,076,875
(collateralized by various U.S. Treasury
STRIPS, total par value $247,512,000, 02/15/97-
05/15/09: total market value
$153,450,000) 150,000 150,000
Daiwa Securities 6.450%, dated
09/29/95, matures 10/02/95, repurchase
price $100,053,750 (collateralized by
various U.S. Treasury Notes, total par
value $89,180,000, 6.250%-8.750%,
05/15/17-08/15/23: total market value
$102,000,000) 100,000 100,000
Prudential 6.220%, dated 09/29/95,
matures 10/02/95, repurchase price
$19,933,608 (collateralized by various
FNMA obligations, total par value
$22,482,157, 5.000%-9.000%, 05/01/97-
10/01/25: total market value
$20,321,891) 19,923 19,923
Salomon Brothers 6.450%, dated
09/29/95, matures 10/02/95, repurchase
price $17,125,974 (collateralized by
various FNMA obligations, total par value
$27,714,013, 6.000%-10.500%,
05/01/02-09/01/25: total market value
$17,738,028) 17,117 17,117
TOTAL REPURCHASE AGREEMENT
(Cost $287,040) 287,040
TOTAL INVESTMENTS--100.2%
(Cost $751,382) 751,382
OTHER ASSETS AND LIABILITIES--(0.2%)
Other Assets and Liabilities, Net (1,237)
NET ASSETS:
Portfolio
shares--Institutional
Class ($.01 par
value--20 billion
authorized) based on
551,284,505 outstanding
shares $551,285
Portfolio
shares--Corporate Trust
Class ($.01 par
value--20 billion
authorized) based on
198,861,163 outstanding
shares 198,861
Accumulated net
realized loss on
investments (1)
TOTAL NET
ASSETS:--100.0% $750,145
NET ASSET VALUE,
OFFERING PRICE, AND
REDEMPTION PRICE PER
SHARE--INSTITUTIONAL
CLASS $1.00
NET ASSET VALUE,
OFFERING PRICE, AND
REDEMPTION PRICE PER
SHARE--CORPORATE TRUST
CLASS $1.00
The accompanying notes are an integral part of the financial statements.
(A) Variable Rate Security--the rate reported on the Statement of Net Assets is
the rate in effect as of September 30, 1995. The date shown is the next
reset date.
(B) Securities sold within the terms of a private placement memorandum, exempt
from registration under Section 4[2] or 144A of the Securities Act of 1933,
as amended, and may be sold only to dealers in that program or other
"accredited investors." These securities have been determined to be liquid
under guidelines established by the Board of Directors.
AID--Agency for International Development
FHLB--Federal Home Loan Bank
FHLMC--Federal Home Loan Mortgage Corporation
FNMA--Federal National Mortgage Association
LOC--Letter of Credit
SLMA--Student Loan Mortgage Association
STRIPS--Separately Trading of Registered Interest and Principal of
Securities
TREASURY OBLIGATIONS FUND
Description Par (000) Value (000)
U.S. TREASURY OBLIGATIONS--23.4%
U.S. Treasury Bills
6.038%, 10/19/95 $ 25,000 $ 24,927
6.020%, 11/16/95 25,000 24,814
5.415%, 01/18/96 25,000 24,590
5.600%, 02/08/96 25,000 24,509
5.325%, 03/07/96 50,000 48,820
5.820%, 07/25/96 25,000 23,858
U.S. Treasury Notes
4.625%, 02/15/96 25,000 24,904
5.875%, 05/31/96 50,000 50,030
U.S. Treasury STRIPS
0.000%, 02/15/96 25,000 24,485
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $270,937) 270,937
REPURCHASE AGREEMENTS--76.9%
BA Securities 6.200%, dated 09/29/95,
matures 10/02/95, repurchase price
$52,026,867 (collateralized by various
U.S. Treasury Notes, total par value
$51,671,898, 6.500%-7.750%, 04/30/97-
11/30/99: total market value $53,040,000) 52,000 52,000
Bear Stearns 6.150%, dated 09/29/95,
matures 10/02/95, repurchase price
$225,115,313 (collateralized by
various U.S. Treasury STRIPS, total
par value $342,941,777, 11/15/97-
02/15/03: total market value
$230,175,000) 225,000 225,000
BT Securities 6.100%, dated 09/29/95,
matures 10/02/95, repurchase price
$50,025,417 (collateralized by U.S.
Treasury Note, par value $50,860,716,
6.125%, matures 05/31/97: total market
value $51,000,000) 50,000 50,000
CS First Boston 5.730%, dated 09/25/95,
matures 10/02/95, repurchase price
$45,021,488 collateralized by U.S.
Treasury Note, par value $41,316,575,
7.875%, matures 11/15/04:
total market value $45,900,0000 45,000 45,000
Daiwa Securities 6.450%, dated
09/29/95, matures 10/02/95, repurchase
price $107,057,513 (collateralized by
various U.S. Treasury Bonds, total par
value $98,248,700, 7.250%-8.125%,
05/15/96-05/15/21: total market value
$109,140,000) 107,000 107,000
Goldman Sachs 5.750%, dated 09/26/95,
matures 10/02/95, repurchase price
$45,021,563 (collateralized by U.S.
Treasury Bond, par value $28,557,191,
7.250%, matures 05/15/16, total market
value $45,900,000) $45,000 $45,000
Lehman Brothers 5.780%, dated 09/25/95,
matures 10/02/95, repurchase price
$45,021,675 (collateralized by various U.S.
Treasury Notes, total par value
$41,199,314, 6.875%-9.250%, 02/15/96-
03/31/00: total market value
$45,900,000) 45,000 45,000
Merrill Lynch 5.700%, dated 09/29/95,
matures 10/02/95, repurchase price
$50,023,750 (collateralized by U.S.
Treasury Note, par value $50,885,656,
6.125%, matures 05/31/97: total market
value $51,000,000) 50,000 50,000
Nomura Securities 5.810%, dated
9/28/95, matures 10/02/95, repurchase
price $45,021,788 (collateralized by
various U.S. Treasury Notes, total par
value $46,075,735, 5.625%-6.750%,
05/31/97-06/30/97: total market value
$45,900,000) 45,000 45,000
Prudential Securities 6.200%, dated
9/29/95, matures 10/02/95, repurchase
price $34,681,639 (collateralized by
various U.S. Treasury Notes, total par
value $34,111,546, 5.750%-7.875%,
04/30/99-08/15/03: total market value
$35,357,004) 34,664 34,664
UBS Securities 6.430%, dated 09/29/95,
matures 10/02/95, repurchase price
$190,815,050 (collateralized by
various U.S. Treasury Notes, total par
value $183,034,056, 4.000%-9.125%,
01/31/96-11/15/24: total market value
$194,527,117) 190,713 190,713
TOTAL REPURCHASE AGREEMENTS
(Cost $889,377) 889,377
TOTAL INVESTMENTS--100.3%
(Cost $1,160,314) 1,160,314
OTHER ASSETS AND LIABILITIES--(0.3%)
Other Assets and Liabilities, Net (4,325)
NET ASSETS:
Portfolio shares--Institutional Class ($.01 par
value--20 billion authorized) based on
117,169,937 outstanding shares $ 117,170
Portfolio shares--Corporate Trust Class ($.01 par
value--20 billion authorized) based on
1,038,787,512 outstanding shares 1,038,788
Accumulated net realized gain on investments 31
TOTAL NET ASSETS:--100.0% $1,155,989
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION
PRICE PER SHARE--INSTITUTIONAL CLASS $ 1.00
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION
PRICE PER SHARE--CORPORATE TRUST CLASS $ 1.00
The accompanying notes are an integral part of the financial statements.
STRIPS--Separately Trading of Registered Interest and Principal of
Securities
LIMITED TERM INCOME FUND
Description Par (000) Value (000)
ASSET BACKED SECURITIES--74.6%
ADJUSTABLE RATE MORTGAGES--3.3%
Merrill Lynch Mortgage Investors
1993-C A4
6.875%, 03/15/18 (B) $4,000 $4,000
AUTO COMPANY SUBSIDIARIES--AUTO--5.5%
Capital Auto Receivable Asset Trust 1993-1
5.850%, 02/15/98 950 948
Premier Auto Trust 1992-1 A
5.750%, 07/15/97 (A) 366 366
Premier Auto Trust 1992-5 B
4.900%, 12/15/95 1,004 993
Premier Auto Trust 1993-4 B
4.950%, 02/02/99 904 893
Premier Auto Trust 1994-2 B
6.500%, 06/02/00 (A) 3,430 3,440
6,640
BANKS -- AUTO--8.5%
Boulevard Auto Trust 1993-1 A
4.550%, 03/15/98 822 817
Midlantic Automobile Grantor Trust
1992-1 B
5.150%, 09/15/97 842 840
New South Auto Trust 1994-B A
8.475%, 01/15/02 3,057 3,139
Western Financial Grantor Trust
1993-2 A2
4.700%, 10/01/98 2,019 1,989
Western Financial Grantor Trust
1994-3 B
6.650%, 12/01/99 2,125 2,135
Zions Auto Trust 1993-1 B
5.650%, 06/15/99 1,427 1,421
10,341
BANKS -- BOATS & R.V.'S--4.3%
CFC Grantor Trust TR14
7.150%, 11/15/06 (A) 3,635 3,647
Chemical Financial Acceptance
1991-A A
6.450%, 12/15/97 1,582 1,580
5,227
BANKS--CREDIT CARD RECEIVABLES--7.9%
First USA Credit Card Master Trust
1995-1 A
5.952%, 10/15/01 (B) 4,100 4,098
MBNA Master Credit Card Trust 1994-BA
5.661%, 01/15/02 (B) 5,500 5,472
9,570
BUSINESS CREDIT - AUTO--1.4%
Olympic Automobile Receivables Trust
1993-C B
4.600%, 02/15/00 $1,708 $ 1,683
BUSINESS CREDIT - BUSINESS--4.1%
Leasing Solution Receivables 1994-1 A
5.575%, 03/15/99 661 659
Leasing Solutions Receivables 1994-2 A
8.075%, 12/15/99 1,957 1,977
Orix Credit Alliance Owner Trust
1993-A A2
4.300%, 08/17/98 1,417 1,397
Orix Credit Alliance Owner Trust
1993-C B
4.600%, 08/17/98 945 935
4,968
CONSUMER FINANCE - SECOND MORTGAGE RELATED--3.8%
HFC Home Equity Loan Trust
1992-2 B
6.850%, 11/20/12 1,657 1,632
Household Finance 1992-3 A3
6.100%, 11/20/06 (B) 1,707 1,689
Remodelers Home Improvement 1994-1 A
7.800%, 11/20/99 (A) 1,263 1,267
4,588
CONSUMER FINANCE COMPANY - AUTO--1.2%
Auto Bond Receivables Trust 1993-1 A
6.125%, 11/15/98 1,468 1,452
CONSUMER FINANCE - FIRST MORTGAGE RELATED--2.8%
Saxon Mortgage Securities
1994-4A 1A2
5.250%, 04/25/24 3,469 3,404
EQUIPMENT LEASES--4.3%
JLC Lease Receivables Trust 1994-1 A
6.208%, 12/22/99 (B) 4,241 4,242
World Omni Leasing 1993-1 B
5.000%, 05/17/99 936 928
5,170
MEDICAL LEASES--2.9%
Amerisource Receivables Master Trust
1995-1 A
6.225%, 03/15/00 (A) (B) 3,500 3,504
MORTGAGE BANKERS & LOANS - SECOND MORTGAGE
RELATED--13.0%
BCI Home Equity Loan 1991-1 A1
7.100%, 09/15/06 $ 1 $ 1
BCI Home Equity Loan 1994-1 B
6.537%, 03/29/44 (B) 2,327 2,335
Greentree Financial 1995 A-A1
7.000%, 04/15/20 1,849 1,857
The Money Store Home Equity Loan
Trust 1992-D1 A1
6.500%, 01/15/04 3,074 3,077
The Money Store Home Equity Loan
Trust 1993-B A1
5.400%, 08/15/05 3,055 2,965
The Money Store Home Equity Loan
Trust 1994-C1 A1
6.775%, 09/15/07 1,507 1,508
The Money Store Trust Series 1994-D1 A2
8.000%, 11/15/07 4,000 4,082
15,825
RETAIL MALL MORTGAGES--6.8%
Bristol Oaks, L.P. 1994-1 B
6.525%, 07/10/99 (B) 4,250 4,242
Potomac Mills Finance 1C
7.013%, 10/20/04 (B) 4,000 4,000
8,242
VACATION HOME MORTGAGES--4.9%
Patten 1995-1A
7.250%, 08/01/11 (A) (B) 4,000 3,994
RCI Vacation Ownership Mortgage
Trust 1991-B
7.500%, 08/25/98 (A) 1,957 1,955
5,949
TOTAL ASSET BACKED SECURITIES
(Cost $90,396) 90,563
CORPORATE OBLIGATIONS--4.6%
ELECTRICAL SERVICES--0.8%
Houston Lighting & Power
8.625%, 01/15/96 1,000 1,008
FINANCIAL SERVICES--1.2%
American General Finance
7.300%, 10/16/95 500 500
Heller Financial
6.500%, 11/15/95 1,000 999
1,499
FOOD, BEVERAGE & TOBACCO--0.8%
Philip Morris
8.875%, 07/01/96 $ 900 $ 917
PAPER & PAPER PRODUCTS--0.4%
International Paper
9.625%, 10/15/95 450 451
RETAIL--0.8%
Dayton Hudson
4.820%, 04/01/96 1,000 994
WHOLESALE--0.6%
Supervalue
5.875%, 11/15/95 750 750
TOTAL CORPORATE OBLIGATIONS
(Cost $5,787) 5,619
OTHER MORTGAGE BACKED OBLIGATIONS--11.8%
Capstead Securities IV 1992-3 B
8.000%, 06/25/22 3,071 3,103
General Electric Capital Mortgage
1995-1 A1
8.350%, 02/25/25 1,942 1,952
Mortgage Capital Funding
1993-C1 A1
5.250%, 05/25/15 1,866 1,845
Mortgage Capital Funding
1993-C1 A2
6.512%, 05/25/15 (B) 4,530 4,523
Mortgage Obligation Structured Trust
1993-1 A1
6.350%, 10/25/18 1,411 1,399
RTC 1992-11 A1A
7.150%, 06/25/23 564 546
RTC 1992-C7 B
7.000%, 10/25/24 989 985
TOTAL OTHER MORTGAGE BACKED OBLIGATIONS
(Cost $14,331) 14,353
U.S. GOVERNMENT AGENCY OBLIGATIONS--2.1%
FNMA
8.650%, 08/25/18 2,453 2,485
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS
(Cost $2,471) 2,485
TAXABLE MUNICIPAL BONDS--1.7%
Colorado Health Facilities
Authority (RB)
6.200%, 07/01/25 (B) $2,000 $ 2,000
TOTAL TAXABLE MUNICIPAL BONDS
(Cost $2,000) 2,000
U.S. GOVERNMENT AGENCY MORTGAGE-BACKED
OBLIGATIONS--0.8%
FHLMC 1625-B
4.750%, 01/15/01 1,000 991
TOTAL U.S. GOVERNMENT AGENCY MORTGAGE-BACKED
OBLIGATIONS
(Cost $1,001) 991
MASTER NOTES--1.2%
Goldman Sachs
5.830%, 10/03/95 (C) 1,500 1,500
TOTAL MASTER NOTES
(Cost $1,500) 1,500
REPURCHASE AGREEMENTS--5.8%
J.P. Morgan 6.358%, dated 09/29/95,
matures 10/02/95, repurchase price
$3,316,195 (collateralized by U.S.
Treasury STRIPS, total par value
$10,375,512, 11/15/00-11/15/24: total
market value $3,380,747) 3,314 3,314
Merrill Lynch 5.830%, dated 09/29/95,
matures 10/02/95, repurchase price
$3,694,220 (collateralized by various
U.S. Treasury Bills, total par value
$788,853, 03/07/96-09/19/96: U.S.
Treasury Notes, total par value
$2,313,814, 7.625%-13.750%,
11/15/03-11/15/10: total market value
$3,766,348) 3,693 3,693
TOTAL REPURCHASE AGREEMENTS
(Cost $7,007) 7,007
TOTAL INVESTMENTS--102.6%
(Cost $124,493) 124,518
OTHER ASSETS AND LIABILITIES--(2.6%)
Other Assets and Liabilities, Net (3,102)
NET ASSETS:
Portfolio shares--Institutional Class--
($.0001 par value--2 billion authorized)
based on 11,231,268 outstanding shares $114,651
Portfolio shares--Retail Class A--($.0001
par value--2 billion authorized) based on
1,005,426 outstanding shares 10,618
Undistributed net investment income 38
Accumulated net realized loss on investments (3,916)
Net unrealized appreciation of investments 25
TOTAL NET ASSETS:--100.0% $121,416
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION PRICE
PER SHARE--INSTITUTIONAL CLASS $ 9.92
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE--RETAIL CLASS A $ 9.92
MAXIMUM SALES CHARGE OF 2.00%+ 0.20
OFFERING PRICE PER SHARE--RETAIL CLASS A $10.12
The accompanying notes are an integral part of the financial statements.
+ The offer price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 2.00%.
(A) Security sold within the terms of a private placement memorandum, exempt
from registration under section 144a of the Securities Act of 1933, as
amended, and may be sold only to dealers in that program or other
"accredited Investors". These securities have been determined to be liquid
under the guidelines established by the Board of Directors.
(B) Variable Rate Security--the rate reported on the Statement of Net Assets is
the rate in effect as of September 30, 1995.
(C) Variable Rate Security with Demand Features--the rate reported on the
Statement of Net Assets is the rate in effect as of September 30, 1995. The
date shown is the longer of the reset or demand date.
FHLMC--Federal Home Loan Mortgage Corporation
FNMA--Federal National Mortgage Association
RB--Revenue Bond
RTC--Resolution Trust Corporation
STRIPS--Separately Trading of Registered Interest and Principal of
Securities
INTERMEDIATE TERM INCOME FUND
Description Par (000) Value (000)
U.S. TREASURY OBLIGATIONS--59.8%
U.S. Treasury Notes
5.500%, 07/31/97 $12,590 $12,517
5.125%, 02/28/98 11,115 10,926
5.125%, 11/30/98 10,615 10,368
6.750%, 04/30/00 5,230 5,377
6.250%, 02/15/03 8,915 8,966
7.250%, 08/15/04 5,770 6,166
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $53,380) 54,320
OTHER MORTGAGED BACKED OBLIGATIONS--9.9%
Drexel Burnham Lambert Trust S2
9.000%, 08/01/18 91 96
GECMS
6.000%, 04/25/09 2,925 2,822
Kidder Peabody Mortgage Assets
Trust 6F
7.950%, 07/20/18 513 516
MDC Mortgage Funding P3
8.200%, 11/20/17 22 23
Morgan Stanley Mortgage Trust W5
9.050%, 05/01/18 168 177
Prudential Home Mortgage Securities
1992-A3
7.000%, 04/25/99 1,978 2,010
Prudential Home Mortgage Securities
Remic 1994-28
6.801%, 09/25/01 2,275 2,239
Resolution Trust 1991-M6 B2
7.000%, 06/25/21 (B) 1,170 1,154
TOTAL OTHER MORTGAGED BACKED OBLIGATIONS
(Cost $8,828) 9,037
CORPORATE OBLIGATIONS--9.5%
Bear Stearns
6.500%, 06/15/00 2,800 2,779
Cigna
7.400%, 01/15/03 3,075 3,106
Farmers Group
8.250%, 07/15/96 320 325
GMAC
7.650%, 01/16/98 2,385 2,451
TOTAL CORPORATE OBLIGATIONS
(Cost $8,768) 8,661
ASSET BACKED SECURITIES--7.4%
BW Home Equity Trust 1990-1 1
9.250%, 09/15/05 25 26
Chemical Financial Acceptance 1991-A 1
6.450%, 12/15/97 577 577
Fleet Finance Home Equity 1990-1
8.900%, 01/16/06 90 92
Household Finance Home Equity 1993-2 A3
4.650%, 12/20/08 $ 2,101 $ 2,044
Olympic Auto Receivables Trust 1993-D
4.750%, 07/15/00 1,574 1,550
Olympic Auto Receivables Trust 1994-A
5.700%, 01/15/01 368 366
Zale Funding Series 94-1, Class B
7.500%, 05/15/03 (B) 2,000 2,036
TOTAL ASSET BACKED SECURITIES
(Cost $6,669) 6,691
U.S. GOVERNMENT AGENCY MORTGAGE-BACKED
OBLIGATIONS--6.6%
FHLMC
6.000%, 11/15/08 3,500 3,188
7.550%, 05/15/20 93 92
8.000%, 10/15/20 2,630 2,704
FNMA
14.750%, 03/01/12 1 1
TOTAL U.S. GOVERNMENT AGENCY MORTGAGE-BACKED
OBLIGATIONS
(Cost $6,192) 5,985
MASTER NOTES--1.6%
Goldman Sachs
5.830%, 10/03/95 (A) 1,435 1,435
TOTAL MASTER NOTES
(Cost $1,435) 1,435
REPURCHASE AGREEMENTS--4.1%
J.P. Morgan 6.358%, dated 09/29/95,
matures 10/02/95, repurchase price
$1,126,239 (collateralized by various
U.S. Treasury STRIPS, total par value
$3,523,710, 11/15/00 - 11/15/24,
total market value $1,148,162) 1,126 1,126
Merrill Lynch 5.830%, dated 09/29/95,
matures 10/02/95, repurchase price
$2,557,464 (collateralized by various
U.S. Treasury Bills, total par value
$546,114, 03/07/96 - 09/19/96: U.S.
Treasury Bonds, total par value
$1,601,826, 7.625% - 13.750%,
11/15/03 - 11/15/10: total market
value $2,607,398) 2,556 2,556
TOTAL REPURCHASE AGREEMENTS
(Cost $3,682) 3,682
TOTAL INVESTMENTS--98.9%
(Cost $88,954) 89,811
OTHER ASSETS AND LIABILITIES--1.1%
Other assets and liabilities, Net 1,001
NET ASSETS:
Portfolio shares--Institutional Class
($.0001 par value--2 billion authorized)
based on 8,887,937 outstanding shares $87,916
Portfolio shares--Retail Class A ($.0001
par value--2 billion authorized) based on 245,108
outstanding shares 2,494
Undistributed net investment income 1
Accumulated net realized loss on investments (456)
Net unrealized appreciation of investments 857
TOTAL NET ASSETS:--100.0% $90,812
NET ASSET VALUE, OFFERING PRICE, AND
REDEMPTION PRICE PER SHARE--INSTITUTIONAL CLASS $ 9.94
NET ASSET VALUE AND REDEMPTION PRICE
PER SHARE--RETAIL CLASS A $ 9.94
MAXIMUM SALES CHARGE OF 3.75%+ 0.39
OFFERING PRICE PER SHARE--RETAIL CLASS A $10.33
The accompanying notes are an integral part of the financial statements.
+ The offer price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 3.75%.
(A) Variable Rate Security with Demand Features--the rate reported on the
Statement of Net Assets is the rate in effect as of September 30,1995. The
date shown is the longer of the reset date or the demand date.
(B) Security sold within the terms of a private placement memorandum, exempt
from registration under section 144A of the Securities Act of 1933, as
amended, and maybe sold only to dealers in that program or other
"accredited investors." These securities have been determined to be liquid
under the guidelines established by the Board of Directors.
FHLMC--Federal Home Loan Mortgage Corportation
FNMA--Federal National Mortgage Association
GMAC--General Motors Acceptance Corporation
GECMS--General Electric Capital Marketing Service
STRIPS--Separately Trading of Registered Interest and Principal of
Securities
FIXED INCOME FUND
Description Par (000) Value (000)
U. S. TREASURY OBLIGATIONS--53.3%
U.S. Treasury Bond
7.125%, 02/15/23 $39,865 $ 42,258
U.S. Treasury Notes
5.500%, 07/31/97 41,865 41,624
5.125%, 02/28/98 28,780 28,291
5.125%, 11/30/98 9,725 9,499
6.750%, 04/30/00 29,365 30,191
7.250%, 08/15/04 9,315 9,955
U.S. Treasury STRIPS
0.000%, 02/15/99 1,055 866
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $158,734) 162,684
OTHER MORTGAGE-BACKED OBLIGATIONS--17.7%
Collateralized Mortgage Corporation
88-13 C
8.000%, 09/20/19 126 128
Countrywide Mortgage-Backed
Securities 1994-GA3
6.500%, 04/25/24 2,380 2,331
Drexel Burnham Lambert Trust S-2
9.000%, 08/01/18 796 840
General Electric Capital Marketing
1994-12 A4
6.000%, 04/25/09 3,125 3,015
General Electric Capital Mortgage
1994-11 A1
6.500%, 03/25/24 4,295 4,271
General Electric Capital Mortgage
1994-17 A6
7.000%, 05/25/24 7,000 6,877
General Electric Capital Mortgage
1994-17 A7
7.000%, 05/25/24 5,179 4,885
Goldman Sachs Trust 1 A
6.388%, 05/01/17 (A) 6,454 6,450
J.P. Morgan Commercial Mortgage
Finance 1995-C1 B
7.618%, 07/25/10 10,329 10,444
Merrill Lynch Mortgage Investors
1993-A4
6.875%, 03/15/18 (A) 6,000 6,000
Prudential Home Mortgage Securities
1994-28
6.801%, 09/25/01 (C) 5,975 5,882
Prudential Home Mortgage Securities
1994-6 A3
7.000%, 04/25/99 848 861
Residential Funding 1992-36 A2 P11
5.700%, 11/25/07 1,097 1,079
RTC 1991-M6 B2
7.000%, 06/25/21 (C) 924 912
TOTAL OTHER MORTGAGE-BACKED OBLIGATIONS
(Cost $52,850) 53,975
CORPORATE DEBT OBLIGATIONS--11.0%
Bear Stearns
9.125%, 04/15/98 $ 1,000 $ 1,061
8.750%, 03/15/04 1,000 1,105
Cigna
7.400%, 01/15/03 10,250 10,352
Farmers Group
8.250%, 07/15/96 1,755 1,785
General Foods
6.000%, 06/15/01 1,440 1,413
General Motors Acceptence
6.150%, 05/11/98 2,025 2,012
Morgan Stanley Group
7.320%, 01/15/97 250 253
Nationsbank
7.750%, 08/15/04 1,000 1,060
Santander Financial Issuances
6.800%, 07/15/05 9,465 9,311
Torchmark
9.625%, 05/01/98 250 268
7.875%, 05/15/23 5,000 5,038
TOTAL CORPORATE DEBT OBLIGATIONS
(Cost $33,467) 33,658
U.S. GOVERNMENT AGENCY MORTGAGE-BACKED
OBLIGATIONS--6.2%
FHLMC
6.000%, 11/15/08 1,275 1,162
6.500%, 12/15/23 5,439 5,008
6.500%, 01/15/24 6,445 5,429
7.000%, 02/15/24 7,133 7,180
TOTAL U.S. GOVERNMENT AGENCY MORTGAGE-BACKED
OBLIGATIONS
(Cost $18,176) 18,779
ASSET BACKED SECURITIES--4.4%
BW Home Equity Trust 1990-1 1
9.250%, 09/15/05 81 84
CoreStates Home Equity Trust 1994-2 A2
7.000%, 10/15/09 6,500 6,501
Dillon Reed Structured Finance
1993-K1 A1
6.660%, 08/15/10 580 558
Kidder Peabody Acceptance Brandon
Development
7.870%, 01/01/16 (C) 628 569
Kidder Peabody Acceptance Lake Mary
Development
7.870%, 01/01/16 (C) 1,296 1,174
Morgan Stanley Mortgage Trust
9.050%, 05/01/18 $ 40 $ 42
Olympic Auto Receivables Trust 1994-A
5.700%, 01/15/01 473 470
Zale Funding 1994-1 B
7.500%, 05/15/03 (C) 4,100 4,174
TOTAL ASSET BACKED SECURITIES
(Cost $12,950) 13,572
TAXABLE MUNICIPAL BONDS--3.1%
Minneapolis, Minnesota, Single Family Mortgage,
Callable 10/01/05 @ 100 (RB)
6.920%, 04/01/09 8,415 8,415
San Diego County, California Pension
Obligation, Series A(RB)(AMBAC)
6.560%, 08/15/06 1,000 980
TOTAL MUNICIPAL BONDS
(Cost $9,383) 9,395
MASTER NOTE--1.0%
Goldman Sachs
5.830%, 10/3/95 (B) 2,960 2,960
TOTAL MASTER NOTE
(Cost $2,960) 2,960
REPURCHASE AGREEMENT--5.0%
J.P. Morgan 6.358%, dated 09/29/95,
matures 10/02/95, repurchase price
$6,766,517 (collateralized by various
U.S. Treasury STRIPS, total par value
$21,170,673, 05/15/00 - 05/15/24:
total market value $6,898,232) 6,763 6,763
Merrill Lynch 5.830%, dated 09/29/95,
matures 10/02/95, repurchase price
$8,381,012 (collateralized by various
U.S. Treasury Bills, total par value
$1,789,657, 03/07/96 - 09/19/96: U.S.
Treasury Bonds, total par value
$5,249,310, 7.625% - 13.750%,
11/15/03 - 11/15/10: total market
value $8,544,647) 8,377 8,377
TOTAL REPURCHASE AGREEMENT
(Cost $15,140) 15,140
TOTAL INVESTMENTS--101.7%
(Cost $303,659) 310,163
OTHER ASSETS AND LIABILITIES--(1.7%)
Other Assets and Liabilities, Net (5,214)
NET ASSETS:
Portfolio Shares--Institutional Class ($.0001
par value--2 billion authorized) based on
26,410,097 outstanding shares $280,882
Portfolio Shares--Retail Class A ($.0001 par
value--2 billion authorized) based on 715,075
outstanding shares 7,906
Portfolio Shares--Retail Class B ($.0001 par
value--2 billion authorized) based on 665,639
outstanding shares 7,159
Undistributed net investment income 134
Accumulated net realized gain on investments 2,364
Net unrealized appreciation of investments 6,504
TOTAL NET ASSETS:--100.0% $304,949
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION
PRICE PER SHARE--INSTITUTIONAL CLASS $ 10.97
NET ASSET VALUE AND REDEMPTION PRICE
PER SHARE--RETAIL CLASS A $10.98
Maximum sales charge of 3.75%+ 0.43
OFFERING PRICE PER SHARE--RETAIL CLASS A $11.41
NET ASSET VALUE AND OFFERING PRICE PER
SHARE--RETAIL CLASS B (1) $10.94
The accompanying notes are an integral part of the financial statements.
+ The offer price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 3.75%.
(1) Retail Class B has a contingent deferred sales charge. For a description of
a possible redemption charge, see the notes to the financial statements.
(A) Variable Rate Security--the rate reported on the Statement of Net Assets is
the rate in effect as of September 30, 1995.
(B) Variable Rate Security with Demand Features--the rate reported on the
Statement of Net Assets is the rate in effect as of September 30, 1995. The
date shown is the longer of the reset date or the demand date.
(C) Security sold within the terms of a private placement memorandum, exempt
from registration under section 144A of the Securities Act of 1993, as
amended, and may be sold only to dealers in that program or other
"accredited investors." These securities have been determined to be liquid
under guide lines established by the Board of Directors.
AMBAC--American Municipal Bond Assurance Company
FHLMC--Federal Home Loan Mortgage Corporation
RB--Revenue Bond
RTC--Resolution Trust Corporation
STRIPS--Separately Trading of Registered Interest and Principal of
Securities
INTERMEDIATE GOVERNMENT BOND FUND
Description Par (000) Value (000)
U.S. TREASURY OBLIGATIONS--85.3%
U.S. Treasury Notes
6.125%, 07/31/96 $ 3,000 $ 3,009
6.250%, 08/31/96 3,000 3,013
6.875%, 10/31/96 3,500 3,540
6.500%, 05/15/97 2,000 2,020
6.500%, 08/15/97 7,000 7,079
7.375%, 11/15/97 11,500 11,834
7.875%, 04/15/98 6,000 6,275
5.125%, 11/30/98 4,500 4,395
6.750%, 05/31/99 9,000 9,224
6.875%, 07/31/99 3,000 3,088
7.125%, 09/30/99 9,000 9,352
6.875%, 03/31/00 4,000 4,130
6.250%, 05/31/00 1,000 1,009
7.875%, 08/15/01 2,000 2,175
7.500%, 11/15/01 5,750 6,158
7.500%, 05/15/02 2,000 2,151
6.375%, 08/15/02 250 254
7.250%, 05/15/04 8,600 9,178
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $84,794) 87,884
U.S. GOVERNMENT AGENCY OBLIGATIONS--11.9%
FHLB
6.200%, 01/22/96 2,000 2,004
7.900%, 12/20/96 1,000 1,003
7.750%, 02/26/97 3,000 3,076
7.870%, 12/15/97 3,000 3,113
6.975%, 07/26/99 1,000 1,032
7.440%, 08/10/01 1,000 1,057
SLMA
6.490%, 05/01/96 (A) 1,000 1,005
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS
(Cost $12,039) 12,290
REPURCHASE AGREEMENTS--0.6%
Merrill Lynch 5.830%, dated 09/29/95,
matures 10/02/95, repurchase price
$625,824 (collateralized by various
U.S. Treasury Bills, total par value
$133,637, 06/07/96-09/19/96: U.S.
Treasury Bonds, total par value
$391,975, 7.625%-12.750%,
11/15/03-11/15/10: total market value
$638,043) 626 626
TOTAL REPURCHASE AGREEMENTS
(Cost $626) 626
TOTAL INVESTMENTS--97.8%
(Cost $97,459) 100,800
OTHER ASSETS AND LIABILITIES--2.2%
Other Assets and Liabilities, Net $ 2,228
NET ASSETS:
Portfolio shares--Institutional Class
($.0001 par value--2 billion authorized) based on
10,785,155 outstanding shares 96,942
Portfolio shares--Retail Class A ($.0001
par value--2 billion authorized) based on
307,668 outstanding shares 2,891
Undistributed net investment income 9
Accumulated net realized loss on investments (155)
Net unrealized appreciation of investments 3,341
TOTAL NET ASSETS:--100.0% $103,028
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION PRICE
PER SHARE--INSTITUTIONAL CLASS $ 9.29
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE--RETAIL CLASS A $ 9.29
MAXIMUM SALES CHARGE OF 3.00%+ 0.29
OFFERING PRICE PER SHARE--RETAIL CLASS A $ 9.58
The accompanying notes are an integral part of the financial statements.
+ The offer price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 3.00%.
(A) Floating Rate Security--the rate reported on the Statement of Net Assets is
the rate in effect as of September 30, 1995.
FHLB--Federal Home Loan Bank
SLMA--Student Loan Marketing Association
MORTGAGE SECURITIES FUND
Description Par (000) Value (000)
U.S. GOVERNMENT AGENCY MORTGAGE-BACKED
OBLIGATIONS--76.5%
FHLMC
7.250%, 12/01/98 $ 80 $ 80
7.750%, 10/01/01 64 64
8.500%, 10/01/01 55 57
8.500%, (REMIC) Pool 118-E
05/15/05 248 249
7.400%, (REMIC) Pool 1342-F
10/15/05 1,550 1,558
6.500%, 09/01/07 214 207
8.000%, 04/01/08 268 272
8.000%, 10/01/08 135 137
6.000%, (CMO) Pool 1606-H
11/15/08 615 560
8.750%, 09/01/09 372 384
8.500%, 01/01/10 123 127
14.500%, 02/01/11 2 2
8.000%, 06/01/16 97 98
9.000%, 07/01/16 54 56
8.000%, 10/01/16 133 135
7.500%, 11/01/16 102 102
5.000%, 11/15/17 1,500 1,448
FNMA
8.000%, 08/01/96 2 2
8.670%, 06/01/97 (A) 20 19
6.000%, (REMIC) Pool 1993-212
10/25/98 1,148 1,144
5.750%, (REMIC) Pool 1993-181-DA
11/25/98 962 952
8.000%, 05/01/08 207 212
6.000%, 06/25/08 1,300 1,209
7.000%, 11/25/10 151 151
14.750%, 03/01/12 52 60
5.900%, (REMIC) Pool 1993-G93-26
07/25/15 1,500 1,464
8.250%, (REMIC) Pool G-19-D
07/25/15 730 732
8.500%, 01/01/17 167 173
7.500%, 04/01/18 99 100
7.000%, (REMIC) Pool 1992-180-H
10/25/19 1,500 1,495
6.750%, 11/25/19 1,000 986
5.000%, (REMIC) Pool 1993-97
05/25/23 1,400 1,334
GNMA
10.250%, 05/15/98 41 44
10.750%, 09/15/98 34 37
10.750%, 10/15/00 71 77
10.750%, 01/15/01 100 108
6.500%, 06/15/03 147 142
8.000%, 08/15/06 117 121
8.000%, 08/15/07 174 179
8.500%, 07/15/08 36 38
8.500%, 08/15/08 249 259
9.500%, 08/15/09 12 13
14.000%, 10/15/12 9 11
12.000%, 03/15/14 55 63
12.000%, 03/15/15 28 32
12.000%, 04/15/15 25 29
12.000%, 06/15/15 $ 47 $ 53
10.000%, 03/15/16 28 31
9.500%, 09/15/16 181 194
9.000%, 10/15/16 17 18
9.000%, 02/15/17 344 362
9.500%, 11/15/18 404 431
6.500%, 02/16/23 2,297 2,207
TOTAL U.S. GOVERNMENT AGENCY MORTGAGE-BACKED
OBLIGATIONS
(Cost $19,890) 20,018
OTHER MORTGAGE-BACKED OBLIGATIONS--15.1%
American Housing Trust 3 B
7.500%, 08/25/12 1,062 1,066
Bear Stearns Secured Investors Trust
1991-2 E
7.500%, 12/20/98 1,500 1,519
Collateralized Mortgage Obligation
Trust 63 D
9.000%, 04/20/97 897 901
Morgan Stanley Mortgage Trust W 5
9.050%, 05/01/18 427 450
TOTAL OTHER MORTGAGE-BACKED OBLIGATIONS
(Cost $3,936) 3,936
U. S. TREASURY OBLIGATIONS--3.7%
U.S. Treasury Notes
6.750%, 04/30/00 480 493
6.250%, 02/15/03 480 483
TOTAL U. S. TREASURY OBLIGATIONS
(Cost $962) 976
REPURCHASE AGREEMENTS--3.9%
Merrill Lynch 5.830%, dated 09/29/95,
matures 10/02/95, repurchase price
$1,014,251 (collateralized by various
U.S. Treasury Bills, total par value
$216,580, 03/07/96 - 09/19/96: U.S.
Treasury Bonds, total par value $635,259,
7.625% - 13.750%, 11/15/03 - 11/15/10:
total market value $1,034,053) 1,014
TOTAL REPURCHASE AGREEMENTS (Cost $1,014) 1,014
TOTAL INVESTMENTS--99.2% (Cost $25,802) 25,944
OTHER ASSETS AND LIABILITIES--0.8%
Other Assets and Liabilities, Net 214
NET ASSETS:
Portfolio shares--Institutional Class
($.0001 par value--2 billion authorized)
based on 2,545,986 outstanding shares $25,862
Portfolio shares--Retail Class A ($.0001
par value--2 billion authorized) based on
18,431 outstanding shares 185
Accumulated net realized loss on investments (31)
Net unrealized appreciation of investments 142
TOTAL NET ASSETS:--100.0% $26,158
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION
PRICE PER SHARE--INSTITUTIONAL CLASS $ 10.20
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE--RETAIL CLASS A $ 10.20
MAXIMUM SALES CHARGE OF 3.75%+ 0.40
OFFERING PRICE PER SHARE--RETAIL CLASS A $ 10.60
The accompanying notes are an integral part of the financial statements.
+ The offer price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 3.75%
(A) Variable Rate Security--the rate reported on the Statement of Net Assets is
the rate in effect as of September 30, 1995.
CMO--Collateralized Mortgage Obligation
FHLMC--Federal Home Loan Mortgage Corporation
FNMA--Federal National Mortgage Association
GNMA--Government National Mortgage Association
REMIC--Real Estate Mortgage Investment Conduit
LIMITED TERM TAX FREE INCOME FUND
Description Par (000)/Shares Value (000)
MUNICIPAL BONDS--88.4%
ALASKA--3.7%
North Slope Borough, Series 1994 B (GO)
(CGIC)
5.200%, 06/30/96 $250 $252
ARIZONA--6.0%
Maricopa County, Elementary School
District #17 (GO) (AMBAC)
0.000%, 07/01/98 465 413
CALIFORNIA--7.0%
Roseville, Joint Union High School
District (GO) (FGIC)
0.00%, 08/01/97 250 232
San Gorgonio, Memorial Health Care
District, Insured Health Facility,
Series 95 (RB) (CMI)
5.150%, 06/01/97 250 252
484
COLORADO--9.0%
Adams County (GO)
7.200%, 12/15/97 200 208
Denver City & County Airport, Series C,
Mandatory Put @ 100 (RB) (ST)
6.000%, 04/01/97 (B) 400 410
TOTAL COLORADO 618
ILLINOIS--3.7%
Aurora, Kane, & Dupage Counties, Single
Family Mortgage, Series 95 A (RB)
(GNMA) (AMT)
6.100%, 04/01/08 250 251
MASSACHUSETTS--3.7%
Housing Finance Agency, Insured Rental
Housing, Series A (RB) (AMBAC) (AMT)
4.900%, 01/01/97 250 251
MINNESOTA--32.4%
Crosby, Minnesota Power & Light (RB)
4.600%, 06/01/96 (A) 240 240
Dakota County, Housing & Redevelopment
Authority, Callable 04/01/05 @ 102 (RB)
(AMT) (GNMA/FNMA)
6.000%, 10/01/14 250 248
Fridley, Commercial Development,
Mandatory Put @ 100 (RB) (AMT)
4.900%, 09/01/96 (B) 235 236
Housing Finance Agency, Single Family
Mortgage, Series C (RB)
5.800%, 07/01/96 $ 180 $ 181
Minneapolis, Special School District #1
(COP) (MLO)
4.750%, 06/01/96 300 301
Northern Municipal Power Agency (RB)
7.000%, 01/01/97 220 226
Southern Municipal Power Agency (RB)
5.000%, 01/01/98 250 253
St Paul, Independent School District
#625 (GO) (ISF)
6.500%, 02/01/97 300 312
West St. Paul, School District #197
(GO) (ISF) (MBIA)
0.000%, 02/01/98 250 226
2,223
MISSISSIPPI--7.3%
Delta Correctional Facilities Authority
(RB) (CGIC) (MLO)
4.450%, 07/01/98 500 501
TENNESSEE--4.0%
Local Development Authority,
Community Provider Loan Program (RB)
4.600%, 10/01/96 275 276
TEXAS--4.8%
State (GO)
6.700%, 12/01/96 320 330
WISCONSIN--3.1%
Williams Bay, School District (GO)
(AMBAC)
7.125%, 04/01/98 200 213
WYOMING--3.7%
State Student Loan Program (RB) (AMT)
6.000%, 12/01/97 250 255
TOTAL MUNICIPAL BONDS
(Cost $6,009) 6,067
CASH EQUIVALENTS--9.6%
Federated Minnesota Municipal Cash
Trust 336,160 336
Federated Tax Free Money Market 324,798 325
TOTAL CASH EQUIVALENTS
(Cost $661) 661
TOTAL INVESTMENTS--98.0%
(Cost $6,670) 6,728
OTHER ASSETS AND LIABILITIES--2.0%
Other Assets and Liabilities, Net 138
NET ASSETS:
Portfolio shares--Institutional Class
($.0001 par value--2 billion authorized)
based on 630,929 outstanding shares $6,281
Portfolio shares--Retail Class A ($.0001
par value--2 billion authorized) based
on 51,708 outstanding shares 512
Undistributed net investment income 16
Accumulated net realized loss on investments (1)
Net unrealized appreciation on investments 58
TOTAL NET ASSETS:--100.0% $6,866
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION
PRICE PER SHARE--INSTITUTIONAL CLASS $10.06
NET ASSET VALUE AND REDEMPTION PRICE PER SHARE--
RETAIL CLASS A $10.06
MAXIMUM SALES CHARGE OF 2.00%+ 0.21
OFFERING PRICE PER SHARE--RETAIL CLASS A $10.27
The accompanying notes are an integral part of the financial statements.
+ The offer price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 2.00%.
(A) Variable Rate Security--the rate reported on the Statement of Net Assets is
the rate in effect as of September 30, 1995.
(B) Mandatory Put Security--the mandatory put date is shown as the maturity
date on the Statement of Net Assets.
AMT--Alternative Minimum Tax
AMBAC--American Municipal Bond Assurance Company
CGIC--Capital Guaranty Insurance Company
CMI--California Mortgage Insurers
COP--Certificates of Participation
FNMA--Federal National Mortgage Association
FGIC--Financial Guaranty Insurance Corporation
GNMA--Government National Mortgage Association
GO--General Obligation
ISF--Insured by State Funds
MBIA--Municipal Bond Insurance Association
MLO--Municipal Lease Obligation
RB--Revenue Bond
ST--Sumitomo Trust
INTERMEDIATE TAX FREE FUND
Description Par (000)/Shares Value (000)
MUNICIPAL BONDS--94.6%
CALIFORNIA--8.8%
Contra Costa, Water District, Callable
10/01/04 @ 102 (RB) (MBIA)
5.800%, 10/01/07 $1,000 $1,041
Orange County, Refunding Recovery (RB)
(MBIA)
5.000%, 06/01/01 500 503
Orange County, Transportation Authority, Callable
02/15/02 @ 102 (RB)
5.700%, 02/15/03 200 205
San Bernadino County, Medical Center,
Series A (MLO) (MBIA)
4.800%, 08/01/00 500 507
San Diego, District Number 1 Park
Facilities, Callable 01/01/04 @ 101, (RB)
5.625%, 01/01/06 200 208
State Health Facilities Authority,
Callable 10/01/98 @ 102 (RB) (CMI)
7.250%, 10/01/99 500 538
Suisun City, Redevelopment Agency Tax Allocation,
Pre-refunded @ 102 (RB)
7.250%, 04/01/00 (A) 1,000 1,131
4,133
COLORADO--8.5%
Arvada, Sales & Use Tax, Callable
12/01/2002 @ 100 (RB) (FGIC)
5.900%, 12/01/05 1,000 1,045
Colorado Springs Utilities, Crossover
Refunding, Series A (RB)
6.350%, 11/15/01 1,000 1,105
State Health Facilities Authority, Vail
Valley Medical Center, Series A (RB)
5.300%, 01/15/00 500 500
5.450%, 01/15/01 500 500
State Housing Finance Authority, Single
Family Mortgages, Callable 08/01/99 @
102 (RB) (FHA/VA)
7.400%, 08/01/09 815 839
3,989
FLORIDA--2.4%
North Brevard County, Health, Hospital,
& Nursing Home Improvements, Jess
Parish Memorial Hospital (RB) (AMBAC)
6.800%, 09/01/96 15 15
Reedy Creek, Utility, Callable 10/01/97
@ 102 (RB)
8.900%, 10/01/03 1,000 1,105
1,120
ILLINOIS--5.5%
Aurora, Kane, & Dupage Counties, Single
Family Mortgage, Series 1995-A (RB)
(GNMA) (AMT)
6.100%, 04/01/08 $ 750 $ 754
Peoria, Moline, & Freeport, Single
Family Mortgages, Series 1995-A,
Callable 10/01/05 @103 (RB) (AMT)
5.600%, 10/01/10 (B) 1,270 1,272
State Development Finance Authority,
Lockport Township High School
(RB)(FGIC)
0.000%, 01/01/01 750 582
2,608
INDIANA--0.9%
Perry Township, Multi-School Building, Escrowed To
Maturity (RB) (STAID)
7.000%, 07/01/97 15 16
State Housing Finance Authority,
Callable 01/01/98 @ 102.5 (RB) (FPI)
7.800%, 01/01/99 415 429
445
IOWA--0.2%
Davenport, Home Ownership Mortgage,
Series 1994 (RB)
4.000%, 03/01/03 75 74
MICHIGAN--5.0%
Dearborn School District, Callable
05/01/03 @ 101.5 (GO) (MBIA)
4.850%, 05/01/05 1,100 1,079
Detroit, Pre-refunded @ 102 (GO)
8.000%, 04/01/01 (A) 1,000 1,176
St. Joseph, Hospital Finance Authority
(RB) (AMBAC)
4.750%, 01/01/02 100 99
2,354
MINNESOTA--16.3%
Anoka County, Solid Waste Disposal (RB)
(CFC) (AMT)
6.000%, 12/01/98 1,000 1,042
Bloomington, Mall of America, Series A,
Callable 02/01/04 @ 100 (RB)
5.450%, 02/01/09 1,000 1,023
Burnsville Apartment Projects, Series A,
Putable 12/01/98 @ 100, Callable 06/01/95
@ 101 (RB)
5.000%, 12/01/08 1,000 1,000
Minneapolis & St Paul, Housing &
Redevelopment Authority, Callable
11/15/03 @ 102 (RB) (AMBAC)
4.750%, 11/15/18 $1,000 $ 845
Minneapolis, Hennepin Avenue,
Series C (GO)
6.200%, 03/01/02 800 860
Robbinsdale, North Memorial Medical
Center, Callable 05/15/03 @ 102 (RB)
(AMBAC)
5.450%, 05/15/13 1,000 958
Southern Minnesota Municipal Power
Authority, Callable 01/01/03 @ 102 (RB)
(FGIC)
5.000%, 01/01/06 500 496
Wayzata, School District, Series B,
Callable 02/01/03 @ 100 (RB) (FGIC)
4.900%, 02/01/07 1,500 1,435
7,659
MISSISSIPPI--2.0%
Delta Correctional Facilities Authority
(RB) (MLO) (FGIC)
4.950%, 07/01/01 925 934
MISSOURI--2.3%
Kansas City, School District (RB) (MLO) (FGIC)
6.300%, 02/01/00 1,000 1,071
NEW JERSEY--2.2%
State Transportation System, Series A
(RB) (AMBAC)
5.200%, 12/15/00 1,000 1,033
NEW MEXICO--1.7%
Farmington, Utility Systems, Escrowed
to Maturity (RB)
10.000%, 01/01/02 685 814
NEW YORK--3.0%
Environmental Facilities, Pollution Control,
Callable 11/15/04 @ 102 (RB)
6.400%, 05/15/06 1,250 1,405
NORTH DAKOTA--3.4%
Bismarck, Hospital Authority (RB)
(AMBAC)
6.250%, 05/01/99 1,000 1,055
Fargo, Water Utilities, Callable
01/01/2000 @ 100 (RB)
5.900%, 01/01/02 500 523
State Bank Capital Financing Program,
Series E (GO)
6.400%, 12/01/95 20 20
1,598
OHIO--4.4%
Kings County, Local School District,
Callable 12/01/05 @100 (GO) (FGIC)
5.750%, 12/01/10 $1,000 $1,020
West Clermont, Local School District,
Callable 12/01/05 @ 100 (GO) (AMBAC)
5.650%, 12/01/08 1,030 1,061
2,081
OKLAHOMA--0.6%
Oklahoma County, Home Finance
Authority, Pre-refunded @ 100 (RB)
0.000%, 03/01/06 (A) 790 262
OREGON--2.8%
Deschutes & Jefferson Counties,
School District (GO) (MBIA)
5.000%, 06/01/02 500 511
Multnomah County, School District (GO)
5.100%, 06/01/03 500 508
State (GO)
7.000%, 07/01/01 250 283
1,302
PENNSYLVANIA--2.4%
Northumberland County, Commonwealth
Lease, Callable 10/15/01 @ 100 (RB) (MLO)
6.600%, 10/15/02 1,000 1,108
PUERTO RICO--3.0%
Commonwealth (GO) (MBIA)
5.500%, 07/01/01 1,000 1,050
Housing Finance Authority, Single
Family Mortgage (RB) (GNMA)
5.800%, 10/15/00 250 256
6.000%, 02/01/02 110 113
1,419
SOUTH DAKOTA--1.2%
Sioux Falls (GO) (MLO)
6.450%, 08/01/01 500 549
TENNESSEE--1.1%
Nashville & Davidson County,
Metropolitan Government, Callable
12/01/01 @ 100 (GO)
6.200%, 12/01/09 500 528
TEXAS--0.0%
San Antonio, Electric & Gas
Improvement (RB)
6.900%, 02/01/96 15 15
UTAH--1.2%
Intermountain Power, Callable
07/01/98 @ 102 (RB)
7.625%, 07/01/08 $ 500 $ 543
VIRGINIA--8.7%
Peninsula Regional Jail Authority
(RB) (MBIA)
5.300%, 10/01/09 1,000 988
Riverside, Regional Jail Authority,
Callable 07/01/05 @ 102 (RB) (MBIA)
5.700%, 07/01/08 2,000 2,079
Virginia Beach, Callable 11/01/04
@ 102 (GO) (STAID)
5.500%, 11/01/05 1,000 1,018
4,085
WASHINGTON, D.C.--0.4%
District of Columbia, Callable
06/01/98 @ 101.5 (GO) (MBIA)
6.750%, 06/01/01 200 213
WEST VIRGINIA--2.1%
State Hospital Finance Authority,
(RB) (MBIA)
5.000%, 09/01/05 1,000 988
WISCONSIN--4.5%
Milwaukee County, Callable 09/01/02
@ 100 (GO)
5.550%, 09/01/03 1,000 1,039
Oak Creek, Water Works System,
Callable 12/01/95 @ 100 (RB)
5.600%, 12/01/96 25 25
State, Pre-refunded @ 100 (GO)
6.900%, 05/01/98 (A) 1,000 1,062
2,126
TOTAL MUNICIPAL BONDS
(Cost $43,322) 44,456
CASH EQUIVALENTS--3.9%
Federated Minnesota Municipal Cash
Trust 782,812 783
Federated Tax Free Money Market 1,046,031 1,046
TOTAL CASH EQUIVALENTS
(Cost $1,829) 1,829
TOTAL INVESTMENTS--98.5%
(Cost $45,151) 46,285
OTHER ASSETS AND LIABILITIES--1.5%
Other Assets and Liabilities, Net 723
NET ASSETS:
Portfolio shares--Institutional Class ($.0001 par
value--2 billion authorized) based on 4,295,302
outstanding shares $44,561
Portfolio shares--Retail Class A ($.0001 par
value--2 billion authorized) based on 91,683
outstanding shares 977
Undistributed net investment income 1
Accumulated net realized gain on investments 335
Net unrealized appreciation of investments 1,134
TOTAL NET ASSETS:--100.0% $47,008
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION
PRICE PER SHARE--INSTITUTIONAL CLASS $ 10.72
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE--RETAIL CLASS A $ 10.72
MAXIMUM SALES CHARGE OF 3.00%+ 0.33
OFFERING PRICE PER SHARE--RETAIL CLASS A $ 11.05
The accompanying notes are an integral part of the financial statements.
+ The offer price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 3.00%.
(A) The Pre-refunded date is shown as the maturity date on the Statement of Net
Assets.
(B) When issued security (Total cost $1,270,000)
AMBAC--American Municipal Bond Assurance Company
AMT--Alternative Minimum Tax
CFC--National Rural Utilities Co-op Finance Corporation
CMI--California Municipal Insurers
COP--Certificates of Participation
FGIC--Federal Guaranty Insurance Company
FHA--Federal Housing Authority
FPI--Foremost Pool Insurance
GO--General Obligation
GNMA--Government National Mortgage Association
LOC--Letter of Credit
MBIA--Municipal Bond Insurance Association
MLO--Municipal Lease Obligation
RB--Revenue Bond
STAID--State Aid Withholding
VA--Veterans Administration
COLORADO INTERMEDIATE TAX FREE FUND
Description Par (000)/Shares Value (000)
MUNICIPAL BONDS--97.2%
COLORADO--97.2%
Adams County, School District #12,
Callable 12/15/96 @ 101 (GO)
7.650%, 12/15/03 $ 975 $1,018
Arapahoe County, Cherry Creek School
District #5, Callable 12/15/00 @ 101
(GO)
6.800%, 12/15/01 1,000 1,111
Arapahoe County, Cherry Creek School
District #5, Callable 12/15/95 @ 102
(GO)
5.600%, 12/15/97 1,000 1,023
Auraria, Higher Education Center,
Callable 04/01/2003 @ 101 (RB) (FSA)
5.000%, 04/01/05 500 494
Aurora, Callable 12/01/04 @ 101 (COP) (MLO)
6.000%, 12/01/06 1,000 1,031
Aurora, Community College Project (RB)
(MLO) (CLE)
5.750%, 10/15/04 500 524
Boulder County, Sales & Use Tax
(RB) (FGIC)
5.750%, 12/15/05 1,000 1,048
Boulder Valley, School District #Re 2,
Callable 10/15/01 @ 100 (GO)
5.900%, 10/15/02 500 531
5.900%, 10/15/03 500 527
Boulder Valley, School District #Re 2,
Callable 12/01/04 @ 101, 12/01/06
@ 100 (GO) (STAID)
5.950%, 12/01/07 1,000 1,061
Boulder, Callable 10/01/01 @ 101 (GO)
5.700%, 10/01/04 250 262
Boulder, Larimer, & Weld Counties,
Vrain Valley School District #Re 1JT,
Callable 12/15/02 @ 101 (GO) (MBIA)
6.000%, 12/15/10 1,000 1,036
Boulder, Larimer, & Weld Counties,
Vrain Valley School District,
Pre-refunded @ 101 (GO)
7.200%, 12/15/99 (A) 500 556
Boulder, Urban Renwal Tax Allocation
(RB) (MBIA)
5.700%, 03/01/00 1,250 1,309
Brighton, Callable 12/01/01
@ 101 (GO) (MBIA)
6.350%, 12/01/05 500 536
Broomfield, Callable 11/01/96
@ 101 (GO)
7.600%, 11/01/03 1,000 1,040
Centennial Water & Sanitation, Series A,
Callable 12/01/96 @ 101 (GO) (SWB)
4.750%, 12/01/97 $ 500 $ 508
Colorado Springs, Series A, Callable
11/15/01 @ 102 (RB)
6.625%, 11/15/04 1,000 1,111
6.500%, 11/15/15 945 990
Denver, City & County Airport, Series C,
Mandatory Put @ 100 (RB) (ST)
6.000%, 12/01/25 (B) 1,250 1,281
Denver, City & County Airport, Series D
(RB) (MORG)
4.500%, 11/15/25 500 500
Denver, City & County School District
#1, Series A (GO)
5.200%, 12/01/03 250 254
Douglas & Elbert Counties, School
District #1, Callable 12/15/04 @ 101
(GO) (MBIA)
6.400%, 12/15/11 1,000 1,060
Eagle, Garfield, & Routt Counties,
School District #50 J, Callable
12/01/04 @ 102 (GO) (FGIC)
6.125%, 12/01/09 1,290 1,348
El Paso County, School District
#2 Harrison (GO)
7.050%, 12/01/04 1,000 1,134
El Paso County, School District
#20 (COP) (MLO)
6.100%, 12/01/99 250 261
Fort Collins, Callable 12/01/02
@ 101 (GO)
5.550%, 12/01/03 500 526
6.400%, 12/01/09 575 612
Garfield, Pitkin, & Eagle Counties,
School District #1 (GO) (MBIA)
6.000%, 12/15/04 1,000 1,078
Jefferson County, Industrial
Development (RB)
6.625%, 09/01/01 250 270
Jefferson County, Metropolitain Y.M.C.A.,
Callable 08/01/04 @ 100 (RB)
7.500%, 08/01/08 1,000 1,024
Jefferson County, School District #R 1,
Callable 12/15/02 @ 101 (GO) (AMBAC)
5.900%, 12/15/04 1,000 1,064
La Plata County, School Districts #9 &
Durango, Callable 11/01/02 @ 101 (GO)
(FGIC)
6.200%, 11/01/05 1,000 1,069
Larimer County, School District #R 1
Poudre (GO)
5.400%, 12/15/04 $ 750 $ 756
Larimer, Weld, & Boulder Counties,
School District #R 2J Thompson,
Callable 12/15/04 @ 100 (GO)
5.900%, 12/15/06 1,000 1,039
Longmont, Callable 09/01/01 @ 100 (GO)
6.000%, 09/01/03 500 526
Louisville, Callable 06/01/98 @ 101
(GO) (FGIC)
7.200%, 12/01/04 465 496
Morgan City, Pollution Control, Series
A, Callable 6/01/03 @ 101, 6/01/04 @
100 (RB) (MBIA)
5.500%, 06/01/12 1,000 976
Northglenn, Callable 11/01/96 @ 101
(GO) (MBIA)
6.400%, 11/01/98 500 516
7.125%, 11/01/06 500 516
Platte River Power Authority,
Series BB (RB)
5.500%, 06/01/02 500 524
Poudre Valley, Hospital District,
Pre-refunded @ 101 (RB)
6.700%, 11/15/98 (A) 500 538
Pueblo County, Single Family Mortgage,
Callable 11/01/04 @ 102 (RB)
(GNMA/FNMA)
6.400%, 11/01/13 1,100 1,115
Pueblo, Urban Renewal Authority,
Callable 12/1/03 @ 101 (RB) (AMBAC)
5.800%, 12/01/09 840 860
Regional Transit District (RB)
5.750%, 11/01/01 2,000 2,117
South Suburban Park & Recreation
District (GO) (MBIA)
0.000%, 12/15/01 1,000 748
State Board of Agriculture, Fort Lewis
College (RB) (FGIC)
6.000%, 10/01/02 250 268
State Housing Finance Authority (RB)
5.000%, 06/01/04 160 153
State Housing Finance Authority,
Multi-family Housing,
Series A (RB) (FHA)
5.125%, 10/01/03 695 675
State Housing Finance Authority,
Single Family Mortgage, Series B-1
(RB) (AMT)
5.875%, 06/01/11 1,000 999
State Housing Finance Authority,
Single Family Mortgage, Series C-2
(RB) (FHA) (AMT)
6.850%, 08/01/22 $ 320 $ 324
State Student Loan Obligation
Authority, Series A (RB)
6.250%, 06/01/96 240 242
State Water Resource & Power
Development Authority, Callable
09/01/02 @ 101 (RB) (FSA)
5.900%, 09/01/03 250 266
State Water Resource & Power
Development Authority, Clean Water
Project, Callable 09/01/02 @ 102 (RB)
5.800%, 09/01/06 1,000 1,049
Steamboat Springs, Accommodations
Tax, Callable 03/01/04 @ 100 (RB)
(MBIA)
5.800%, 03/01/10 1,000 1,019
Stonegate Village Metropolitain District,
Callable 12/01/02 @ 100 (GO)
6.300%, 12/01/04 500 536
Summit County, School District #Re 1,
Callable 12/01/04 @ 101 (GO) (FGIC)
6.450%, 12/01/08 1,250 1,350
Thornton (GO) (FGIC)
5.600%, 12/01/02 1,000 1,054
Thornton, Callable 12/01/02 @ 101
(GO) (FGIC)
5.650%, 12/01/03 1,000 1,058
University of Colorado, Callable
06/01/99 @ 101 (RB)
6.800%, 06/01/02 300 322
University of Colorado, Hospital
Authority (RB) (AMBAC)
5.250%, 11/15/99 1,400 1,449
Ute Water Conservancy District,
Callable 06/15/97 @ 100 (RB) (AMBAC)
7.700%, 06/15/02 1,000 1,049
Westminster, Water & Wastewater
Utility Enterprise, Callable 10/01/04
@ 100 (RB) (AMBAC)
5.800%, 12/01/05 1,000 1,055
TOTAL MUNICIPAL BONDS
(Cost $48,781) 50,792
CASH EQUIVALENTS--1.0%
Federated Tax Free Money Market 522,027 522
TOTAL CASH EQUIVALENTS
(Cost $522) 522
TOTAL INVESTMENTS--98.2%
(Cost $49,303) $51,314
OTHER ASSETS AND LIABILITIES--1.8%
Other Assets and Liabilities, Net 946
NET ASSETS:
Portfolio shares--Institutional Class
($.0001 par value--2 billion authorized)
based on 4,763,837 outstanding shares 47,866
Portfolio shares--Retail Class A ($.0001 par
value--2 billion authorized) based on 208,333
outstanding shares 2,148
Undistributed net investment income 2
Accumulated net realized gain on investments 233
Net unrealized appreciation on investments 2,011
TOTAL NET ASSETS:--100.0% $52,260
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION
PRICE PER SHARE-INSTITUTIONAL CLASS $ 10.51
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE--RETAIL CLASS A $ 10.51
MAXIMUM SALES CHARGE OF 3.00%+ 0.33
OFFERING PRICE PER SHARE--RETAIL CLASS A $ 10.84
The accompanying notes are an integral part of the financial statements.
+ The offer price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 3.00%
(A) Pre-refunded Security--the pre-refunded date is shown as the maturity date
on the Statement of Net Assets.
(B) Mandatory Put Security--the mandatory put date is shown as the maturity
date on the Statement of Net Assets.
AMT--Alternative Minimum Tax
AMBAC--American Municipal Bond Assurance Company
CLE--Connie Lee
COP--Certificates of Participation
FGIC--Federal Guaranty Insurance Corporation
FHA--Federal Housing Authority
FNMA--Federal National Mortgage Association
FSA--Financial Security Assurance
GNMA--Government National Mortgage Association
GO--General Obligation
MBIA--Municipal Bond Insurance Association
MLO--Municipal Lease Obligation
MORG--Morgan Guaranty
RB--Revenue Bond
ST--Sumitomo Trust
STAID--State Aid Withholding
SWB--Swiss Bank
MINNESOTA INSURED INTERMEDIATE TAX FREE FUND
Description Par (000) Value (000)
MUNICIPAL OBLIGATIONS--95.0%
MINNESOTA--95.0%
Anoka County, Capital Improvement,
Series C (GO)
5.550%, 02/01/05 $2,000 $2,030
Anoka-Hennepin, Callable 02/01/03
@ 100 (GO) (FGIC)
4.875%, 02/01/07 500 476
Becker, Pollution Control, Callable
04/01/99 @ 102 (RB)
6.800%, 04/01/07 2,500 2,691
Becker, Tax Increment-Series D,
Callable 08/01/04 @ 100 (GO) (AMT)
(MBIA)
6.000%, 08/01/07 2,500 2,606
Bloomington, Mall of America Project,
Series A, Callable 02/01/04 @ 100 (RB)
(FSA)
5.450%, 02/01/09 2,850 2,914
Coon Rapids, Single Family Mortgage,
Callable 09/01/04 @ 102 (RB)
5.900%, 09/01/06 430 434
Dakota County, Housing & Redevelopment
Authority, Single Family, Callable
09/01/98 @ 103 (RB) (GNMA,FHA/VA)
7.250%, 03/01/06 770 774
Dakota County, Housing &
Redevelopment, Callable 04/01/05
@ 102 (AMT) (GNMA/FNMA)
6.000%, 10/01/14 1,125 1,118
Dakota, Washington & Stearns Counties,
Single Family Mortgage, Callable
03/01/04 @ 102 (AMT) (RB) (FNMA)
6.000%, 09/01/04 650 661
Duluth, Economic Development Authority, Health
Care Facilities, Callable
11/01/02 @ 102 (RB) (AMBAC)
6.100%, 11/01/04 900 973
Minneapolis & St. Paul Metropolitan
Airports, Callable 01/01/09 @ 102 (RB)
(AMT)
7.800%, 01/01/11 1,000 1,088
Minneapolis & St. Paul, Housing And
Redevelopment Authority, Health Care,
Callable 08/15/00 @ 102 (RB) (MBIA)
7.300%, 08/15/01 1,000 1,123
Minneapolis & St. Paul, Housing
Finance Board, (RB) (AMT) (FNMA/GNMA)
6.800%, 11/01/08 1,500 1,614
Minneapolis & St. Paul, Housing
Finance Board, Single Family Mortgage,
Series A (RB) (AMT) (GNMA,FHA/VA)
7.875%, 12/01/12 40 41
Minneapolis, Community Development
Agency (RB) (MBIA)
7.000%, 03/01/01 $2,500 $2,781
Minneapolis, Convention Center,
Pre-refunded @ 102 (RB) (AMBAC)
7.400%, 04/01/98 (B) 500 519
Minneapolis, Health Care Facilities,
Callable 11/15/03 @ 102 (RB) (MBIA)
5.100%, 11/15/05 1,000 986
Minneapolis, School District No. 1
(RB) (MLO) (AMBAC)
5.300%, 02/01/02 1,000 1,011
Minnesota State Public Facility Authority,
Water Pollution Control, Callable
12/01/99 @ 100 (RB) (CGIC)
6.750%, 03/01/00 1,000 1,094
Minnesota State, Housing &
Redevelopment Authority, Single
Family, Callable 04/01/04 @ 102 (RB)
(AMT) (FNMA)
6.250%, 10/01/04 1,065 1,082
Minnesota State, Housing Financial
Agency, Single Family Mortgage, Series
D, Callable 01/01/04 @ 102 (RB)
(AMBAC)
4.800%, 07/01/04 800 772
Minnesota State, Pre-refunded @ 100 (GO)
6.800%, 08/01/00 (B) 2,790 2,978
Minnesota Tax-Exempt Mortgage Trust,
Series A (RB) (MLO) (Northwestern National)
5.615%, 08/01/96 (A) 105 105
Minnesota Tax-Exempt Mortgage Trust,
Series C (RB) (MLO) (Northwestern National)
7.035%, 09/01/10 (A) 891 885
Northern Minnesota Power Agency,
Callable 01/01/99 @ 102 (RB) (AMBAC)
7.250%, 01/01/00 700 767
Northern Municipal Power Agency,
Minnesota Electric, Series A, Callable
01/01/03 @ 102 (RB) (AMBAC)
5.700%, 01/01/05 2,000 2,080
Olmsted County Minnesota, Pre-refunded
@ 100 (GO)
6.550%, 02/01/98 (B) 1,000 1,031
Olmsted County, Housing And
Redevelopment, Pre-refunded 02/01/01 @
100 (RB)
7.000%, 02/01/05 (B) 1,025 1,143
Olmsted County, Pre-refunded 02/01/97
@ 100 (GO)
6.650%, 02/01/99 (B) 1,000 1,034
Osseo, Independent School District (GO)
5.700%, 02/01/03 2,000 2,053
Osseo, Independent School District,
Callable 02/01/03 @ 100 (GO) (FGIC)
5.400%, 02/01/05 500 505
Plymouth Health Facilities, Callable
06/01/04 @ 102 (RB) (CGIC)
6.200%, 06/01/11 1,360 1,413
Robbinsdale, North Memorial Medical
Center, Series B, Callable 05/15/03
@ 102 (RB) (AMBAC)
5.450%, 05/15/13 $1,000 $ 958
Rochester, St. Mary's Hospital,
Escrowed to Maturity (RB)
5.750%, 10/01/07 3,000 3,145
Rosemount, Independent School
District, Series B (GO) (FGIC)
5.600%, 02/01/98 1,000 1,031
Saint Louis Park, Hospital Revenue
Facilities, Methodist Hospital,
Series C, Pre-refunded @ 102 (RB)
(AMBAC)
7.150%, 07/01/00 (B) 1,240 1,401
Southern Minnesota Municipal Power
Agency (RB) (MBIA)
4.850%, 01/01/07 375 361
Southern Minnesota Municipal Power
Agency, Refunded Balance Series A,
Callable 01/01/03 @ 102 (RB)
5.600%, 01/01/04 255 268
St Paul, Housing & Redevelopment
Authority, Callable 09/01/05 @ 102
(RB) (FNMA)
6.125%, 03/01/17 500 506
St Paul, Independent School District (RB)
6.125%, 02/01/00 525 562
St. Paul, Sewer Revenue Bond, Callable
06/01/03 @ 100 (RB) (AMBAC)
5.350%, 12/01/04 800 810
Stearns County, Housing And
Redevelopment Authority, Callable
02/01/99 @ 102 (RB) (MLO) (AMBAC)
6.750%, 02/01/04 1,665 1,788
Stillwater, Independent School
District, Callable 02/01/02 @ 100
(RB) (FGIC)
5.200%, 02/01/03 2,500 2,547
Washington County, Housing And
Redevelopment Authority, Jail Facility (RB)
6.400%, 02/01/00 1,000 1,070
Washington County, Housing And
Redevelopment Authority,
Pre-refunded @ 100 (RB)
6.800%, 02/01/04 (B) 1,500 1,674
Washington County, Raymie Johnson
Apartments, Series C (GO) (FGIC)
6.000%, 01/01/10 1,340 1,340
Wayzata Independent School District,
Series B, Callable 02/01/03 @ 100
(GO) (AMBAC)
4.900%, 02/01/07 2,000 1,918
West St. Paul, Independent School
District (RB) (MBIA)
0.000%, 02/01/00 545 443
Willmar, Independent School District,
Callable 02/01/02 @ 100 (GO) (AMBAC)
6.150%, 02/01/09 100 104
60,708
TOTAL MUNICIPAL OBLIGATIONS
(Cost $58,482) $60,708
CASH EQUIVALENTS--2.2%
Federated Minnesota Municipal
Cash Trust 1,389,447 1,389
TOTAL CASH EQUIVALENTS
(Cost $1,389) 1,389
TOTAL INVESTMENTS--97.2%
(Cost $59,871) 62,097
OTHER ASSETS AND LIABILITIES--2.8%
Other Assets and Liablities, Net 1,815
NET ASSETS:
Portfolio shares--Institutional Class
($.0001 par value--2 billion authorized)
based on 6,219,198 outstanding shares 59,313
Portfolio shares--Retail Class A ($.0001 par
value--2 billion authorized) based on 223,792
outstanding shares 2,162
Undistributed net investment income 9
Accumulated net realized gain on investments 202
Net unrealized appreciation on investments 2,226
TOTAL NET ASSETS:--100.0% $63,912
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION
PRICE PER SHARE--INSTITUTIONAL CLASSS $ 9.92
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE--RETAIL CLASS A $ 9.92
MAXIMUM SALES CHARGE OF 3.00%+ 0.31
OFFERING PRICE PER SHARE--RETAIL CLASS A $ 10.23
The accompanying notes are an integral part of the financial statements.
+ The offer price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 3.00%.
(A) Variable Rate Security--the rate reported on the Statement of Net Assets is
the rate in effect as of September 30, 1995. The date shown is the longer
of the reset date or demand date.
(B) Mandatory Put Security--the mandatory put date is shown as the maturity
date on the Statement of Net Assets.
AMBAC--American Municipal Bond Assurance Company
AMT--Alternative Minimum Tax
CGIC--Capital Guaranty Insurance Company
FGIC--Financial Guaranty Insurance Company
FHA/VA--Federal Housing Authority/Veterans Administration
FNMA--Federal National Mortgage Association
FSA--Financial Security Assurance
GNMA--Government National Mortgage Association
GO--General Obligation
MBIA--Municipal Bond Insurance Company
MLO--Municipal Lease Obligation
RB--Revenue Bond
ASSET ALLOCATION FUND
Description Shares/Par (000) Value (000)
COMMON STOCK--57.7%
AEROSPACE & DEFENSE--0.5%
Lockheed Martin 1,152 $ 77
Loral 500 29
Raytheon 700 60
Rockwell International 1,300 61
227
AGRICULTURE--0.1%
Pioneer Hi-Bred International 500 23
AIR TRANSPORTATION--0.2%
AMR* 500 36
Delta Air Lines 300 21
Federal Express* 300 25
Southwest Airlines 900 23
U.S. Air Group* 300 3
108
AIRCRAFT--1.0%
AlliedSignal 1,700 75
Boeing 2,100 143
General Dynamics 400 22
McDonnell Douglas 700 58
Northrop 300 18
Teledyne 500 14
Textron 500 34
United Technologies 700 62
426
APPAREL/TEXTILES--0.1%
Fruit of the Loom* 500 10
Liz Claiborne 600 15
Russell 400 10
V.F. 400 21
56
AUTOMOTIVE--1.4%
Chrysler 2,300 122
Dana 600 17
Eaton 500 27
Echlin 400 14
Ford Motor 6,400 199
General Motors 4,500 211
Navistar International* 800 10
Paccar 200 9
TRW 400 30
639
BANKS--3.8%
Banc One 2,352 86
Bank of Boston 700 33
Bank of New York 1,200 56
BankAmerica 2,200 $132
Bankers Trust New York 500 35
Barnett Banks 600 34
Boatmens Bancshare's 800 30
Chase Manhattan 1,000 61
Chemical Banking 1,500 91
Citicorp 2,400 170
CoreStates Financial 800 29
First Chicago 500 34
First Fidelity Bancorp 500 34
First Interstate Bancorp 500 50
First Union 1,000 51
Fleet Financial Group 800 30
Golden West Financial 400 20
Great Western Financial 800 19
H.F. Ahmanson 700 18
J.P. Morgan 1,100 85
KeyCorp 1,400 48
MBNA 900 37
Mellon Bank 900 40
National City 900 28
Nationsbank 1,600 108
NBD Bancorp 900 34
Norwest 2,000 66
PNC Bank 1,400 39
Republic New York 300 18
Shawmut National 800 27
Suntrust Banks 700 46
U.S. Bancorp 600 17
Wachovia 1,000 43
Wells Fargo 300 56
1,705
BEAUTY PRODUCTS--1.0%
Avon Products 400 29
Colgate-Palmolive 900 60
Ecolab 500 14
International Flavors & Fragrances 700 34
Procter & Gamble 4,100 315
452
BROADCASTING, NEWSPAPERS & ADVERTISING--0.8%
Capital Cities ABC 900 106
CBS 425 34
Comcast, Cl A 1,400 28
Interpublic Group 500 20
Tele-Communications, Cl A* 3,900 68
Viacom, Cl B* 2,215 110
366
BUILDING & CONSTRUCTION--0.2%
Centex 400 $ 12
Fluor 500 28
Foster Wheeler 300 11
Halliburton 700 29
Owens Corning Fiberglass* 300 13
93
BUSINESS SUPPLIES--0.0%
W.W. Grainger 300 18
CHEMICALS--1.8%
Air Products & Chemical 700 36
Dow Chemical 1,600 119
E.I. du Pont de Nemours 3,300 227
Eastman Chemical 500 32
FMC* 200 15
Great Lakes Chemical 400 27
Hercules 700 41
Monsanto 700 71
Morton International 900 28
Nalco Chemical 400 14
PPG Industries 1,200 56
Praxair 800 21
Rohm & Haas 400 24
Union Carbide 800 32
W.R. Grace 600 40
783
COMMUNICATIONS EQUIPMENT--1.0%
Andrew* 200 12
DSC Communications* 700 41
General Signal 300 9
Harris 200 11
Motorola 3,500 269
Northern Telecom 1,500 53
Scientific-Atlanta 500 8
Tellabs* 500 21
424
COMPUTERS & SERVICES--2.0%
Apple Computer 700 26
Cabletron Systems* 400 26
Ceridian* 300 13
Compaq Computer* 1,600 77
Digital Equipment* 900 41
Hewlett Packard 3,100 258
IBM 3,400 323
Intergraph* 600 7
Pitney Bowes 900 38
Silicon Graphics* 1,000 34
Tandem Computers* 1,000 12
Tandy 400 24
Unisys* 1,600 13
892
CONTAINERS & PACKAGING--0.1%
Ball 100 $ 3
Crown Cork & Seal* 500 19
Newell 900 23
45
DRUGS--4.5%
Abbott Laboratories 4,800 205
Allergan 400 13
Alza, Cl A* 500 12
American Home Products 1,900 161
Amgen* 1,600 80
Bristol-Myers Squibb 3,000 219
Eli Lilly 1,129 101
Guidant 1,992 58
Johnson & Johnson 3,900 289
Mallinckrodt Group 500 20
Merck 7,400 414
Pfizer 3,800 203
Schering Plough 2,200 113
Upjohn 1,000 45
Warner Lambert 800 76
2,009
ELECTRICAL SERVICES--2.2%
American Electric Power 1,100 40
Baltimore Gas & Electric 900 23
Carolina Power & Light 900 30
Central & South West 1,200 31
Cinergy 900 25
Consolidated Edison New York 1,400 43
Detroit Edison 900 29
Dominion Resources of Virginia 1,000 38
Duke Power 1,200 52
Entergy 1,400 37
FPL Group 1,100 45
General Public Utilities 700 22
Houston Industries 800 35
Niagara Mohawk Power 1,000 13
Northern States Power 400 18
Ohio Edison 900 20
Pacific Gas & Electric 2,500 75
Pacificorp 1,700 32
PECO Energy 1,300 37
Public Service Enterprise Group 1,500 45
Raychem 300 14
SCEcorp 2,700 48
Southern 4,000 94
Texas Utilities 1,400 49
Thomas & Betts 200 13
Unicom 1,300 39
Union Electric 600 22
969
ENTERTAINMENT--0.5%
Harrah's Entertainment* 650 $ 19
King World Productions* 300 11
Walt Disney 3,100 178
208
ENVIRONMENTAL SERVICES--0.3%
Browning Ferris Industries 1,300 39
Laidlaw, Cl B 1,700 15
WMX Technologies 2,900 83
137
FINANCIAL SERVICES--1.4%
American Express 2,900 129
Beneficial 300 16
Dean Witter Discover 1,046 59
FHLMC 1,100 76
FNMA 1,600 165
H & R Block 600 23
Household International 600 37
Merrill Lynch 1,100 69
Salomon 600 23
Transamerica 428 30
627
FOOD, BEVERAGE & TOBACCO--5.1%
Adolph Coors, Cl B 400 7
American Brands 1,100 46
Anheuser Busch 1,500 94
Archer Daniels Midland 3,392 52
Brown Forman, Cl B 400 16
Campbell Soup 1,500 75
Coca Cola 7,600 527
ConAgra 1,500 59
CPC International 900 59
General Mills 1,000 56
H.J. Heinz 1,500 69
Hershey Foods 500 32
Kellogg 1,300 94
PepsiCo 4,700 240
Philip Morris 5,000 418
Quaker Oats 800 27
Ralston-Ralston Purina Group 600 35
Sara Lee 2,900 86
Seagram 2,200 79
Unilever (ADR) 1,000 130
UST 1,200 34
Whitman 600 12
William Wrigley Jr. 700 35
2,282
GAS/NATURAL GAS--0.5%
Coastal 600 $ 20
Columbia Gas Systems* 400 15
Consolidated Natural Gas 600 24
Enron 1,500 50
Nicor 500 14
Pacific Enterprises 500 13
Panhandle Eastern 900 25
Sonat 500 16
Williams 600 23
200
GLASS PRODUCTS--0.1%
Corning 1,400 40
HOTELS & LODGING--0.0%
Hilton Hotels 300 19
HOUSEHOLD FURNITURE & FIXTURES--0.1%
Masco 1,000 28
HOUSEHOLD PRODUCTS--0.5%
Clorox 300 21
Gillette 2,700 129
Maytag 700 12
National Service Industries 400 12
Sherwin Williams 500 18
Snap-On Tools 300 11
Stanley Works 300 13
Whirlpool 400 23
239
INSURANCE--2.4%
Aetna Life & Casualty 700 51
Alexander & Alexander Services 200 5
Allstate 2,717 96
American General 1,200 45
American International Group 2,825 240
Chubb 500 48
Cigna 400 42
General Re 500 76
Jefferson-Pilot 300 19
Lincoln National 600 28
Loew's 400 58
Marsh & McLennan 400 35
Providian 600 25
Safeco 400 26
St. Paul 500 29
Torchmark 400 17
Travelers 1,935 103
U.S. Healthcare 900 32
U.S. Life 450 13
United Healthcare 1,000 49
Unum 400 21
USF & G 700 14
1,072
JEWELRY, PRECIOUS METALS--0.0%
Jostens 500 $ 12
LEISURE--0.0%
Brunswick 600 12
LUMBER & WOOD PRODUCTS--0.0%
Louisiana Pacific 600 14
MACHINERY--2.7%
Applied Materials* 500 51
Baker Hughes 800 16
Black & Decker 500 17
Briggs & Stratton 400 16
Caterpillar 1,200 68
Crane 300 10
Cummins Engine 200 8
Deere 500 41
Dover 700 27
Dresser Industries 1,100 26
Emerson Electric 1,300 93
General Electric 10,200 650
Harnischfeger Industries 300 10
Ingersoll Rand 600 23
McDermott International 400 8
Pall 700 16
Parker Hannifin 450 17
Tenneco 1,100 51
Timken 300 13
Tyco International 500 32
Varity* 300 13
1,206
MEASURING DEVICES--0.2%
Honeywell 800 33
Johnson Controls 200 13
Perkin Elmer 300 11
Tektronix 200 12
69
MEDICAL PRODUCTS & SERVICES--0.9%
Bausch & Lomb 300 12
Baxter International 1,700 70
Becton Dickinson 400 25
Beverly Enterprises* 800 11
Biomet* 700 12
Boston Scientific* 900 38
Columbia/HCA Healthcare 2,637 129
Manor Care 400 14
Medtronic 1,400 75
St. Jude Medical* 300 19
Tenet Healthcare* 1,200 21
United States Surgical 500 13
439
METALS & MINING--0.0%
Cyprus AMAX Minerals 550 $ 15
MISCELLANEOUS BUSINESS SERVICES--1.9%
Autodesk 300 13
Automatic Data Processing 900 61
Cisco Systems* 1,600 110
Computer Associates International 1,400 59
Computer Sciences* 300 19
CUC International* 1,050 37
First Data 700 43
Microsoft* 3,500 318
Novell* 2,200 40
Ogden 500 12
Oracle* 2,600 100
Shared Medical Systems 300 12
Sun Microsystems* 600 38
862
MISCELLANEOUS CONSUMER SERVICES--0.1%
Service International 600 23
MULTI-INDUSTRY--0.5%
Dial 600 15
ITT 700 87
Minnesota Mining & Manufacturing 2,500 141
243
OIL - DOMESTIC--0.7%
Ashland Oil 400 13
Atlantic Richfield 1,000 106
Kerr-McGee 300 17
Louisiana Land & Exploration 300 11
Pennzoil 300 13
Phillips Petroleum 1,600 52
Sun 491 13
Unocal 1,500 43
USX-Marathon Group 1,800 36
304
OIL - INTERNATIONAL--4.0%
Amerada Hess 600 29
Amoco 3,000 192
Chevron 3,900 190
Exxon 7,500 542
Mobil 2,400 239
Royal Dutch Petroleum (ADR) 3,200 393
Schlumberger 1,500 98
Texaco 1,600 103
1,786
PAPER & PAPER PRODUCTS--1.1%
Avery Dennison 300 13
Bemis 400 11
Boise Cascade 300 12
Champion International 600 32
Federal Paper Board 300 $ 12
Georgia Pacific 500 44
International Paper 1,500 63
James River 500 16
Kimberly Clark 1,000 66
Mead 300 18
Potlatch 300 12
Scott Paper 900 44
Stone Container 600 11
Temple Inland 300 16
Union Camp 400 23
Westvaco 400 18
Weyerhaeuser 1,200 55
Willamette Industries 300 20
486
PETROLEUM & FUEL PRODUCTS--0.2%
Burlington Resources 800 31
Enserch 800 13
Helmerich & Payne 400 11
Occidental Petroleum 1,900 42
Western Atlas* 300 14
111
PHOTOGRAPHIC EQUIPMENT & SUPPLIES--0.5%
Eastman Kodak 2,100 124
Polaroid 300 12
Xerox 600 81
217
PRECIOUS METALS--0.3%
Barrick Gold 2,100 54
Echo Bay Mines 1,200 13
Homestake Mining 800 14
Newmont Mining 473 20
Placer Dome 1,400 37
Santa Fe Pacific Gold 900 11
149
PRINTING & PUBLISHING--0.8%
American Greetings, Cl A 400 12
Deluxe 500 17
Dow Jones 600 22
Gannett 800 44
Knight-Ridder 300 18
McGraw-Hill 300 25
Meredith 300 12
Moore 600 12
New York Times, Cl A 600 16
R.R. Donnelley & Sons 900 35
Time Warner 2,300 90
Times Mirror, Cl A 700 20
Tribune 400 27
350
PROFESSIONAL SERVICES--0.2%
Dun & Bradstreet 1,000 $ 58
EG&G 600 12
70
RAILROADS--0.6%
Burlington Northern Santa Fe 879 64
Consolidated Rail 500 34
CSX 600 50
Norfolk Southern 800 60
Union Pacific 1,200 80
288
REPAIR SERVICES--0.0%
Ryder System 500 13
RETAIL--3.5%
Albertson's 1,500 51
American Stores 900 26
Circuit City 600 19
Dayton Hudson 400 30
Dillard Department Stores 700 22
Gap 900 32
Giant Food 400 13
Great Atlantic & Pacific Tea 400 11
Harcourt General 400 17
Hasbro 500 16
Home Depot 2,833 113
J.C. Penney 1,400 69
Kmart 2,800 41
Kroger* 700 24
Longs Drug Stores 300 12
Lowe's Companies 1,000 30
Luby's Cafeterias 500 11
Marriott 800 30
Mattel 1,375 40
May Department Stores 1,500 66
McDonald's 4,200 161
Melville 600 21
Mercantile Stores 300 14
Nordstrom 500 21
Pep Boys-Manny Moe & Jack 400 11
Price/Costco* 1,200 21
Rite Aid 500 14
Sears Roebuck 2,300 85
The Limited 2,100 40
Toys R Us* 1,700 46
Wal-Mart Stores 13,800 340
Walgreen 1,500 42
Wendy's International 600 13
Winn Dixie Stores 500 30
Woolworth 800 13
1,545
RUBBER & PLASTIC--0.5%
Armstrong World Industries 200 $ 11
B.F. Goodrich 200 13
Cooper Tire & Rubber 500 12
Goodyear Tire & Rubber 900 35
Illinois Tool Works 700 41
Nike, Cl B 400 46
Premark International 400 20
Reebok International 500 17
Rubbermaid 900 25
220
SEMI-CONDUCTORS/INSTRUMENTS--1.3%
Advanced Micro Devices* 600 17
AMP 1,300 50
Intel 4,900 296
Micron Technology 1,200 95
National Semiconductor* 700 19
Texas Instruments 1,100 88
565
SPECIALTY MACHINERY--0.1%
Cooper Industries 603 21
Westinghouse Electric 2,400 36
57
STEEL & STEEL WORKS--0.7%
Alcan Aluminium 1,400 45
Aluminum Company of America 1,100 58
Bethlehem Steel* 700 10
Englehard 900 23
Freeport-McMoran Copper
& Gold, Cl B* 1,200 31
Inco 700 24
Inland Steel Industries 400 9
Nucor 500 22
Phelps Dodge 400 25
Reynolds Metals 400 23
USX-U.S. Steel Group 500 16
Worthington Industries 600 11
297
TELEPHONES & TELECOMMUNICATION--5.0%
Airtouch Communications* 3,000 92
Alltel 1,100 33
Ameritech 3,300 172
AT&T 9,500 623
Bell Atlantic 2,600 160
Bellsouth 3,000 219
GTE 5,800 228
MCI Communications 4,100 107
NYNEX 2,600 124
Pacific Telesis Group 2,600 80
SBC Communications 3,700 204
Sprint 2,100 74
U.S. West 2,800 132
2,248
TRUCKING--0.1%
Pittston Services Group 300 $ 8
Roadway Services 300 15
Yellow 300 4
27
WHOLESALE--0.2%
Alco Standard 300 25
Genuine Parts 700 28
Sigma Aldrich 300 15
Supervalu 400 12
Sysco 1,100 30
110
TOTAL COMMON STOCK
(Cost $20,653) 25,825
U. S. TREASURY OBLIGATIONS--8.5%
U. S. Treasury Notes
7.250%, 05/15/04 2,200 2,347
6.500%, 05/15/05 1,425 1,457
TOTAL U. S. TREASURY OBLIGATIONS
(Cost $3,552) 3,804
MASTER NOTES--9.1%
Associates Corporation of North America
5.708%, 10/02/95 (A) $2,025 2,025
Goldman Sachs
5.830%, 10/03/95 (A) 2,040 2,041
TOTAL MASTER NOTES
(Cost $4,066) 4,066
REPURCHASE AGREEMENTS--24.3%
J.P. Morgan 6.358%, dated 09/29/95,
matures 10/02/95, repurchase price
$5,907,698 (collateralized by various
U.S. Treasury STRIPS, total par value
$18,484,498, 11/15/00-11/15/24:
total market value $6,022,971) 5,905 5,905
Merrill Lynch 5.830%, dated 09/29/95,
matures 10/02/95, repurchase price
$4,975,402 (collateralized by various
U.S. Treasury Bills, total par value
$1,062,433, 03/07/96-09/19/96: U.S.
Treasury Bonds, total par value
$3,116,262, 7.625%-13.750%,
11/15/03-11/15/10:
total market value $5,072,544) 4,973 4,973
TOTAL REPURCHASE AGREEMENTS
(Cost $10,878) 10,878
TOTAL INVESTMENTS--99.6%
(Cost $39,149) 44,573
OTHER ASSETS AND LIABILITIES--0.4%
Other Assets and Liabilities, Net 201
NET ASSETS:
Portfolio
shares--Institutional
Class ($.0001 par
value--2 billion
authorized) based on
3,685,913 outstanding
shares $36,507
Portfolio
shares--Retail Class
A ($.0001 par
value--2 billion
authorized) based on
84,645 outstanding
shares 870
Portfolio
shares--Retail Class
B ($.0001 par
value--2 billion
authorized) based on
48,876 outstanding
shares 531
Undistributed net
investment income 33
Accumulated net
realized gain on
investments 1,409
Net unrealized
appreciation of
investments 5,424
TOTAL NET
ASSETS:--100.0% $44,774
NET ASSET VALUE,
OFFERING PRICE, AND
REDEMPTION PRICE PER
SHARE--INSTITUTIONAL
CLASS $ 11.72
NET ASSET VALUE AND
REDEMPTION PRICE PER
SHARE--RETAIL CLASS A $ 11.73
MAXIMUM SALES CHARGE
OF 4.50%+ 0.55
OFFERING PRICE PER
SHARE--RETAIL CLASS A $ 12.28
NET ASSET VALUE AND
OFFERING PRICE PER
SHARE--RETAIL CLASS B (1) $ 11.68
The accompanying notes are an integral part of the financial statements.
* Non-income producing security
+ The offer price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 4.50%.
(1) Retail Class B has a contingent deferred sales charge. For a description of
possible redemption charge, see the notes to the financial statements.
(A) Variable Rate Security with Demand Features--the rate reported on the
Statement of Net Assets is the rate in effect as of September 30, 1995. The
date shown is the longer of the reset date or demand date.
ADR--American Depository Receipt
FHLMC--Federal Home Loan Mortgage Corporation
FNMA--Federal National Mortgage Association
STRIPS--Separately Trading of Registered Interest and Principal of
Securities
BALANCED FUND
Description Shares/Par (000) Value (000)
COMMON STOCK--50.0%
AUTOMOTIVE--0.9%
General Motors 42,500 $1,992
BANKS--1.9%
Bay Banks 15,700 1,191
Chemical Banking 46,300 2,819
4,010
CHEMICALS--1.9%
Hercules 36,100 2,093
Olin 29,200 2,008
4,101
COMPUTERS & SERVICES--4.3%
Compaq Computer* 54,100 2,617
Cray Research* 82,700 1,830
Hewlett Packard 30,200 2,518
IBM 23,100 2,180
9,145
CONTAINERS & PACKAGING--0.8%
Ball 60,200 1,783
DRUGS--2.4%
American Home Products 33,000 2,801
Bristol-Myers Squibb 30,500 2,223
5,024
FINANCIAL SERVICES--0.9%
ITT 15,300 1,897
FOOD, BEVERAGE & TOBACCO--3.5%
ConAgra 71,200 2,821
Dole Food 71,500 2,476
Sara Lee 69,400 2,065
7,362
HOME APPLIANCE--0.6%
Whirlpool 22,000 1,271
INSURANCE--1.8%
AMBAC 46,500 2,046
General Re 11,000 1,661
3,707
LEISURE--1.2%
Brunswick 122,800 2,487
MACHINERY--3.3%
Briggs & Stratton 6,900 278
Case Equipment 73,800 2,712
Caterpillar 23,400 1,331
General Electric 40,600 2,588
6,909
MULTI-INDUSTRY--1.5%
Minnesota Mining & Manufacturing 35,200 $ 1,989
U.S. Industries* 78,000 1,209
3,198
OIL - DOMESTIC--1.0%
Unocal 73,200 2,086
OIL - INTERNATIONAL--4.9%
Amerada Hess 38,200 1,857
Exxon 24,600 1,777
Mobil 29,100 2,900
Royal Dutch Petroleum (ADR) 17,500 2,148
Texaco 24,600 1,590
10,272
PAPER & PAPER PRODUCTS--2.6%
Bemis 71,300 1,970
James River 71,100 2,275
Scott Paper 25,800 1,251
5,496
PHOTOGRAPHIC EQUIPMENT & SUPPLIES--2.3%
Eastman Kodak 47,400 2,808
Xerox 15,500 2,083
4,891
PRINTING & PUBLISHING--1.3%
Times Mirror, Cl A 96,700 2,780
REAL ESTATE INVESTMENT TRUSTS--3.0%
Debartolo Realty 106,800 1,495
Duke Realty Investments 39,300 1,223
Equity Residential Properties Trust 55,700 1,678
Simon Property Group 76,000 1,929
6,325
RAILROADS--2.2%
Consolidated Rail 30,800 2,118
CSX 29,000 2,439
4,557
RETAIL--3.6%
Dayton Hudson 25,800 1,958
Gap 50,400 1,814
Sears Roebuck 57,000 2,102
Wal-Mart Stores 68,900 1,714
7,588
SEMICONDUCTORS/INSTRUMENTS--1.2%
AMP 29,800 1,147
Texas Instruments 16,700 1,334
2,481
SPECIALTY MACHINERY--0.6%
York International 27,500 $ 1,158
STEEL & STEEL WORKS--0.7%
Aluminum Company of America 28,300 1,496
TELEPHONES & TELECOMMUNICATION--1.1%
Century Telephone Enterprises 76,000 2,309
WHOLESALE--0.5%
W.W. Grainger 17,800 1,075
TOTAL COMMON STOCK
(Cost $86,331) 105,400
U. S. TREASURY OBLIGATIONS--27.4%
U.S. Treasury Bond
7.125%, 02/15/23 $13,835 14,664
U.S. Treasury Notes
5.500%, 04/30/96 4,875 4,871
5.500%, 07/31/97 14,415 14,332
5.125%, 02/28/98 6,965 6,847
5.125%, 11/30/98 1,310 1,280
6.750%, 04/30/00 6,730 6,919
6.250%, 02/15/03 2,415 2,429
7.250%, 08/15/04 5,750 6,145
U.S. Treasury STRIP
0.000%, 02/15/99 265 218
TOTAL U. S. TREASURY OBLIGATIONS
(Cost $56,439) 57,705
CORPORATE OBLIGATIONS--6.4%
Bear Stearns
9.125%, 04/15/98 770 817
8.750%, 03/15/04 1,150 1,271
Cigna
7.400%, 01/15/03 2,825 2,853
Farmers Group
8.250%, 07/15/96 1,045 1,063
General Foods
6.000%, 06/15/01 860 844
General Motors Acceptance
7.650%, 01/16/98 2,375 2,440
Santander Financial Issuances
6.800%, 07/15/05 2,500 2,459
Torchmark
7.875%, 05/15/23 1,700 1,713
TOTAL CORPORATE OBLIGATIONS
(Cost $13,464) 13,460
OTHER MORTGAGE-BACKED OBLIGATIONS--2.9%
Drexel Burnham Lambert CMO Trust S 2
9.000%, 08/01/18 $ 473 $ 499
GE Capital Mortgage Services 1994-11 A1
6.500%, 03/25/24 1,791 1,781
GE Capital Mortgage Services 1994-17 A6
7.000%, 05/25/24 2,675 2,628
Residential Funding 1992-36 A2
5.700%, 11/25/07 653 643
RTC 1991-M6 (B)
7.000%, 06/25/21 (B) 468 462
TOTAL OTHER MORTGAGE-BACKED OBLIGATIONS
(Cost $5,743) 6,013
U.S. GOVERNMENT AGENCY MORTGAGE-BACKED
OBLIGATIONS--2.4%
FHLMC
6.000%, 11/15/08 2,700 2,460
FNMA
5.450%, 10/25/18 2,700 2,585
TOTAL U.S. GOVERNMENT AGENCY MORTGAGE-BACKED
OBLIGATIONS
(Cost $5,290) 5,045
ASSET BACKED SECURITIES--0.8%
BW Home Equity Trust Pool 1990-1 A
9.250%, 09/15/05 45 47
Household Finance 1993-2 A3
4.650%, 12/20/08 1,565 1,522
TOTAL ASSET BACKED SECURITIES
(Cost $1,606) 1,569
MASTER NOTES--1.4%
Goldman Sachs
5.830%, 10/03/95 (A) 3,050 3,050
TOTAL MASTER NOTES
(Cost $3,050) 3,050
REPURCHASE AGREEMENTS--8.4%
J.P. Morgan 6.358%, dated 09/29/95,
matures 10/02/95, repurchase price
$8,515,148 (collateralized by various
U.S. Treasury STRIPS, total par value
$26,641,685, 11/15/00-11/15/24: total
market value $8,680,901) 8,511 8,511
Merrill Lynch 5.830%, dated 09/29/95,
matures 10/02/95, repurchase price
$9,107,689 (collateralized by various
U.S. Treasury Bills, total par value
$1,944,830, 03/07/96-09/19/96: U.S.
Treasury Bonds, total par value
$5,704,452, 7.625%-13.750%,
11/15/03-11/15/10: total market value
$9,285,512) 9,103 9,103
TOTAL REPURCHASE AGREEMENTS
(Cost $17,614) 17,614
TOTAL INVESTMENTS--99.7%
(Cost $189,537) $209,856
OTHER ASSETS AND LIABILITIES--0.3%
Other Assets and Liabilities, Net 697
NET ASSETS:
Portfolio shares--Institutional Class
($.0001 par value--2 billion authorized)
based on 15,845,649 outstanding shares 166,821
Portfolio shares--Retail Class A ($.0001
par value--2 billion authorized) based on
1,261,751 outstanding shares 13,117
Portfolio shares--Retail Class B ($.0001
par value--2 billion authorized) based on
257,977 outstanding shares 2,952
Undistributed net investment income 203
Accumulated net realized gain on investments 7,141
Net unrealized appreciation of investments 20,319
TOTAL NET ASSETS:--100.0% $210,553
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION
PRICE PER SHARE--INSTITUTIONAL CLASS $ 12.13
NET ASSET VALUE AND REDEMPTION PRICE PER SHARE--
RETAIL CLASS A $ 12.12
MAXIMUM SALES CHARGE OF 4.50%+ 0.57
OFFERING PRICE PER SHARE--RETAIL CLASS A $ 12.69
NET ASSET VALUE AND OFFERING PRICE PER SHARE--
RETAIL CLASS B (1) $ 12.09
The accompanying notes are an integral part of the financial statements.
* Non-income producing securities + The offer price is calculated by dividing
the net asset value by 1 minus the maximum sales charge of 4.50%.
(1) Retail Class B has a contingent deferred sales charge. For a description of
a possible redemption charge, see the notes to the financial statements.
(A) Variable Rate Security with Demand Features--the rate reported on the
Statement of Net Assets is the rate in effect as of September 30, 1995. The
date shown is the longer of the reset date or demand date.
(B) Security sold within terms of a private placement memorandum, exempt from
registration under Section 144A of the Securities Act of 1993, as amended,
and may be sold only to dealers in that program or other "accredited
investors." These securities have been determined to be liquid under the
guidelines established by the Board of Directors.
ADR--American Depository Receipt
AMBAC--American Municipal Bond Assurance Company
CMO--Collateralized Mortgage Obligation
FHLMC--Federal Home Loan Mortgage Corporation
FNMA--Federal National Mortgage Association
RTC--Resolution Trust Corporation
STRIPS--Separately Trading of Registered Interest and Principal of
Securities
EQUITY INDEX FUND
Description Shares/Par (000) Value (000)
COMMON STOCKS--96.4%
AEROSPACE & DEFENSE--0.9%
Lockheed Martin 9,927 $ 666
Loral 4,300 245
Raytheon 6,100 519
Rockwell International 10,800 510
1,940
AGRICULTURE--0.1%
Pioneer Hi-Bred International 4,200 193
AIR TRANSPORTATION--0.4%
AMR* 3,800 274
Delta Air Lines 2,500 173
Federal Express* 2,800 232
Southwest Airlines 6,900 174
U.S. Air Group* 5,100 59
912
AIRCRAFT--1.6%
Allied Signal 14,100 622
Boeing 17,100 1,167
General Dynamics 3,100 170
McDonnell Douglas 5,600 463
Northrop 2,400 146
Teledyne 3,600 98
Textron 4,200 287
United Technologies 6,100 539
3,492
APPAREL/TEXTILES--0.1%
Liz Claiborne 2,500 63
Russell 1,200 31
Springs Industries 1,100 43
V.F. 3,100 158
295
AUTOMOTIVE--2.4%
Chrysler 19,000 1,007
Dana 5,000 144
Eaton 3,900 207
Echlin 2,800 100
Fleetwood Enterprises 2,600 52
Ford Motor 53,500 1,665
General Motors 37,200 1,744
Navistar International* 6,500 78
Paccar 1,495 70
TRW 3,200 238
5,305
BANKS--6.3%
Banc One 19,467 711
Bank of Boston 5,600 267
Bank of New York 9,600 $ 446
BankAmerica 18,600 1,114
Bankers Trust New York 3,900 274
Barnett Banks 4,800 272
Boatmens Bancshare's 6,100 226
Chase Manhattan 8,700 532
Chemical Banking 12,600 767
Citicorp 19,800 1,398
CoreStates Financial Group 6,900 253
First Chicago 4,400 302
First Fidelity Bancorp 3,900 263
First Interstate Bancorp 3,800 383
First Union 8,600 439
Fleet Financial Group 7,000 264
Golden West Financial 2,900 146
Great Western Financial 6,800 162
H.F. Ahmanson 5,600 142
J.P. Morgan 9,400 727
KeyCorp 11,300 387
MBNA 7,400 308
Mellon Bank 7,250 324
National City 7,300 225
Nationsbank 13,500 908
NBD Bancorp 7,700 295
Norwest 16,200 531
PNC Bank 11,500 321
Republic New York 2,800 164
Shawmut National 6,400 215
Suntrust Banks 5,600 370
U.S. Bancorp 4,900 138
Wachovia 8,500 367
Wells Fargo 2,400 446
14,087
BEAUTY PRODUCTS--1.7%
Avon Products 3,400 244
Colgate Palmolive 7,200 480
Dial 4,400 109
Ecolab 3,200 88
International Flavors & Fragrances 5,500 265
Procter & Gamble 34,200 2,633
3,819
BROADCASTING, NEWSPAPERS & ADVERTISING--1.4%
Capital Cities ABC 7,700 905
CBS 3,240 259
Comcast, Cl A 11,900 238
Interpublic Group 3,900 155
Tele Communications, TCI Group,
Series A* 32,500 569
Viacom, Cl B* 17,991 895
3,021
BUILDING & CONSTRUCTION--0.3%
Centex 1,600 $ 46
Fluor 4,100 230
Foster Wheeler 2,500 88
Halliburton 5,700 239
Kaufman & Broad Home 7,000 88
Pulte 1,800 51
742
CHEMICALS--2.8%
Air Products & Chemical 5,600 292
B.F. Goodrich 1,000 66
Dow Chemical 13,400 998
E.I. du Pont de Nemours 27,600 1,898
Eastman Chemical 4,075 261
FMC* 1,800 137
Great Lakes Chemical 3,200 216
Hercules 5,600 325
Monsanto 5,700 574
Morton International 7,400 229
Nalco Chemical 3,300 113
Praxair 6,900 185
Rohm & Haas 3,400 205
Union Carbide 6,800 270
W.R. Grace 4,700 314
6,083
COMMUNICATIONS EQUIPMENT--1.6%
Andrew* 1,900 116
DSC Communications* 5,700 338
Harris 1,900 104
Motorola 29,400 2,246
Northern Telecom 12,600 449
Scientific-Atlanta 3,800 64
Tellabs* 4,400 185
Zenith Electronics* 3,200 28
3,530
COMPUTERS & SERVICES--3.4%
Apple Computer 6,000 224
Cabletron Systems* 3,600 237
Ceridian* 2,400 107
Compaq Computers* 13,200 639
Cray Research* 3,000 66
Data General* 10,400 108
Digital Equipment* 7,300 333
Hewlett Packard 25,500 2,126
IBM 28,300 2,669
Intergraph* 8,400 102
Pitney Bowes 7,500 315
Silicon Graphics* 7,900 272
Tandem Computers* 5,200 64
Tandy 3,280 $ 199
Unisys* 5,600 44
7,505
CONCRETE & MINERAL PRODUCTS--0.1%
Owens Corning Fiberglass* 2,500 112
CONTAINERS & PACKAGING--0.2%
Ball 1,900 56
Crown Cork & Seal* 4,500 174
Newell 7,900 196
426
DRUGS--7.5%
Abbott Laboratories 39,500 1,684
Allergan 2,200 73
Alza, Cl A* 2,600 60
American Home Products 15,400 1,307
Amgen* 13,200 658
Bristol-Myers Squibb 25,300 1,844
Eli Lilly 9,294 835
Guidant 16,423 480
Johnson & Johnson 32,100 2,379
Mallinckrodt Group 3,700 147
Merck 61,600 3,451
Pfizer 31,400 1,676
Schering Plough 18,500 953
Upjohn 8,500 379
Warner Lambert 6,700 638
16,564
ELECTRICAL UTILITIES--3.5%
American Electric Power 9,300 338
Baltimore Gas & Electric 7,100 184
Carolina Power & Light 7,700 259
Central & South West 9,500 242
Cinergy 7,773 217
Consolidated Edison New York 11,700 355
Detroit Edison 7,300 235
Dominion Resources of Virginia 8,600 324
Duke Power 10,200 442
Entergy 11,300 295
FPL Group 9,200 376
General Public Utilities 5,800 181
Houston Industries 6,500 287
Niagara Mohawk Power 6,000 79
Northern States Power 3,400 154
Ohio Edison 7,300 166
Pacific Gas & Electric 21,100 630
Pacificorp 14,200 270
PECO Energy 10,800 309
Public Service Enterprise Group 12,200 363
SCEcorp 22,200 394
Southern 33,200 $ 784
Texas Utilities 11,200 391
Unicom 10,700 324
Union Electric Power 4,900 183
7,782
ENERGY--0.0%
Zurn Industries 3,700 94
ENTERTAINMENT--0.7%
King World Productions* 1,700 62
Walt Disney 25,900 1,486
1,548
ENVIRONMENTAL SERVICES--0.5%
Browning Ferris Industries 10,600 322
Laidlaw, Cl B 13,300 116
WMX Technologies 24,100 687
1,125
FINANCIAL SERVICES--2.6%
American Express 24,300 1,078
Beneficial 2,600 136
Dean Witter Discover 8,386 472
FHLMC 9,000 622
FNMA 13,600 1,407
Household International 4,900 304
ITT 5,800 719
Merrill Lynch 8,800 550
Salomon Brothers 5,300 203
Transamerica 3,323 237
5,728
FOOD, BEVERAGE & TOBACCO--8.4%
American Brands 9,400 397
Anheuser Busch 12,700 792
Archer Daniels Midland 28,192 433
Brown Forman, Cl B 3,300 128
Campbell Soup 12,400 623
Coca Cola 62,800 4,336
ConAgra 12,200 483
CPC International 7,300 482
General Mills 7,900 440
H.J. Heinz 12,100 554
Hershey Foods 3,900 251
Kellogg 10,900 789
PepsiCo 39,200 1,999
Philip Morris 41,800 3,491
Quaker Oats 6,700 222
Ralston-Ralston Purina Group 5,200 301
Sara Lee 23,900 711
Seagram 18,500 664
Unilever (ADR) 8,000 1,040
UST 9,600 $ 275
Whitman 5,100 105
William Wrigley Jr 5,800 293
18,809
GAS/NATURAL GAS--0.8%
Coastal 5,200 175
Columbia Gas Systems* 2,200 85
Consolidated Natural Gas 4,500 182
Enron 12,500 419
Nicor 2,200 60
Noram Energy 14,100 111
Oneok 4,700 109
Pacific Enterprises 3,900 98
Panhandle Eastern 7,500 204
Peoples Energy 3,500 96
Sonat 4,200 134
Williams 5,100 199
1,872
GLASS PRODUCTS--0.1%
Corning 11,400 326
HOME APPLIANCES--1.1%
Clorox 2,600 186
Gillette 22,100 1,050
Maytag 3,100 54
National Service Industry 2,800 82
PPG Industries 10,100 470
Raychem 2,100 95
Sherwin Williams 4,100 144
Snap-On Tools 1,200 46
Stanley Works 1,800 78
Thomas & Betts 800 52
Whirlpool 3,600 208
2,465
HOTELS & LODGING--0.1%
Hilton Hotels 2,400 153
HOUSEHOLD FURNITURE & FIXTURES--0.1%
Bassett Furniture Industries 1,687 42
Masco 7,900 218
260
HOUSEHOLD PRODUCTS--0.0%
Brown Group 2,000 37
INSURANCE--4.0%
Aetna Life & Casualty 5,600 411
Alexander & Alexander Services 3,900 95
Allstate 22,350 791
American General 10,200 381
American International Group 23,625 2,010
Chubb 4,300 $ 413
Cigna 3,600 375
General Re 4,100 619
Jefferson-Pilot 2,350 151
Lincoln National 4,700 221
Loews 2,900 422
Marsh & McLennan 3,600 316
Providian 4,600 191
Safeco 3,100 203
St. Paul 4,200 245
Torchmark 3,450 145
Travelers 15,925 846
U.S. Healthcare 7,500 265
United Healthcare 8,600 420
Unum 3,500 185
USF & G 5,700 110
USLife 2,100 61
8,876
LEISURE INDUSTRY--0.0%
Brunswick 4,400 89
LUMBER & WOOD PRODUCTS--0.1%
Louisiana Pacific 5,100 123
MACHINERY--4.6%
Applied Materials* 4,400 450
Baker Hughes 6,800 139
Black & Decker 4,300 147
Briggs & Stratton 1,800 72
Caterpillar 9,900 563
Cincinnati Milacron 2,200 69
Crane 1,600 55
Cummins Engine 1,200 46
Deere 4,300 350
Dover 5,600 214
Dresser Industries 9,100 217
Emerson Electric 11,200 801
General Electric 84,300 5,376
General Signal 2,500 73
Giddings & Lewis 5,100 89
Harnischfeger Industries 2,800 93
Ingersoll Rand 5,100 191
McDermott International 3,300 65
Outboard Marine 4,300 92
Pall 5,600 130
Parker Hannifin 3,650 139
Tenneco 9,000 416
Timken 1,500 64
Tyco Laboratories 3,800 239
Varity* 1,900 85
10,175
MEASURING DEVICES--0.3%
Honeywell 6,200 $ 265
Johnson Controls 2,000 127
Perkin Elmer 2,600 93
Tektronix 2,000 118
603
MEDICAL PRODUCTS & SERVICES--1.7%
Bausch & Lomb 2,800 116
Baxter International 13,800 568
Becton Dickinson 3,200 201
Beverly Enterprises* 4,100 56
Biomet* 5,600 97
Boston Scientific* 7,500 320
C.R. Bard 2,700 82
Columbia/HCA Healthcare 22,137 1,076
Community Psychiatric* 5,500 65
Manor Care 3,100 105
Medtronic 11,600 624
St. Jude Medical* 2,300 145
Tenet Healthcare* 10,000 174
United States Surgical 4,000 107
3,736
METALS & MINING--0.1%
Cyprus AMAX Minerals 4,450 125
MISCELLANEOUS BUSINESS SERVICES--3.2%
Autodesk 2,300 101
Automatic Data Processing 7,200 491
Cisco Systems* 13,500 932
Computer Associates International 11,950 505
Computer Sciences* 2,800 180
CUC International* 8,650 302
First Data 5,900 366
Microsoft* 29,200 2,640
Novell* 18,400 336
Oracle Systems* 21,550 827
Safety Kleen 5,100 75
Shared Medical Systems 2,500 104
Sun Microsystems* 4,800 302
7,161
MISCELLANEOUS CONSUMER SERVICES--0.2%
H & R Block 5,200 197
Service International 4,800 188
385
OIL - DOMESTIC--1.1%
Ashland Oil 2,900 97
Atlantic Richfield 8,000 859
Kerr-McGee 2,500 139
Louisiana Land & Exploration 2,500 89
Pennzoil 2,100 $ 92
Phillips Petroleum 13,100 426
Sun 3,974 102
Unocal 12,300 351
USX Marathon Group 14,800 292
2,447
OIL - INTERNATIONAL--6.3%
Amerada Hess 4,500 219
Amoco 24,700 1,584
Chevron 32,500 1,580
Exxon 61,900 4,472
Mobil 19,700 1,963
Royal Dutch Petroleum (ADR) 26,700 3,277
Texaco 12,900 834
13,929
PAPER & PAPER PRODUCTS--2.3%
Avery Dennison 2,600 109
Bemis 2,400 66
Boise Cascade 2,700 109
Champion International 4,800 259
Federal Paper Board 2,600 100
Georgia Pacific 4,500 394
International Paper 12,700 533
James River 3,900 125
Kimberly Clark 8,000 537
Mead 2,700 158
Minnesota Mining & Manufacturing 20,900 1,180
Scott Paper 7,500 364
Stone Container 2,400 46
Temple Inland 2,700 144
Union Camp 3,500 202
Westvaco 3,400 155
Weyerhaeuser 10,100 461
Willamette Industries 2,700 180
5,122
PETROLEUM & FUEL PRODUCTS--0.8%
Burlington Resources 6,300 244
Enserch 5,300 87
Helmerich & Payne 2,100 59
Occidental Petroleum 15,800 348
Oryx Energy* 6,500 85
Rowan* 7,200 54
Santa Fe Energy Resources* 8,400 80
Schlumberger 12,000 783
Western Atlas* 2,600 123
1,863
PHOTOGRAPHIC EQUIPMENT & SUPPLIES--0.8%
Eastman Kodak 17,000 $1,007
Polaroid 2,700 107
Xerox 5,400 726
1,840
PRECIOUS METALS--0.5%
Barrick Gold 17,600 456
Echo Bay Mines 5,600 61
Homestake Mining 6,900 117
Newmont Mining 4,143 176
Placer Dome 11,900 312
Santa Fe Pacific Gold 5,040 64
1,186
PRINTING & PUBLISHING--1.3%
American Greetings, Cl A 3,600 110
Deluxe 4,000 133
Dow Jones 4,800 177
Gannett 7,000 382
John H. Harland 3,900 86
Knight-Ridder 2,400 141
McGraw Hill 2,500 204
Meredith 2,700 107
Moore 4,500 91
New York Times, Cl A 4,800 131
R.R. Donnelly & Sons 7,600 296
Time Warner 19,200 765
Times Mirror, Cl A 5,400 155
Tribune 3,200 212
2,990
PROFESSIONAL SERVICES--0.2%
Dun & Bradstreet 8,400 486
RAILROADS--1.1%
Burlington Northern Santa Fe 7,608 552
Conrail 3,900 268
CSX 5,200 437
Norfolk Southern 6,500 486
Union Pacific 10,200 676
2,419
REPAIR SERVICES--0.0%
Ryder System 2,500 63
RETAIL--5.7%
Albertson's 12,600 430
American Stores 7,400 210
Circuit City Stores 4,800 152
Dayton Hudson 3,600 273
Dillard Department Stores 5,600 179
Gap 7,200 259
Giant Food 2,400 $ 75
Great Atlantic & Pacific 2,200 62
Harcourt General 3,500 147
Hasbro 4,200 131
Home Depot 23,733 946
J.C. Penney 11,300 561
K-Mart 22,800 331
Kroger* 6,100 208
Lowes 8,000 240
Luby's Cafeterias 4,600 99
Marriott International 6,200 232
Mattel 11,065 325
May Department Stores 12,400 543
McDonald's 34,600 1,323
Melville 5,200 179
Mercantile Stores 2,000 90
Nordstrom 4,100 171
Pep Boys-Manny Moe & Jack 2,900 79
Price/Costco* 9,800 168
Rite Aid 4,000 112
Sears Roebuck 19,400 715
Shoney's* 7,800 86
The Limited 17,800 338
TJX 7,800 93
Toys R US* 13,800 373
Wal-Mart Stores 114,400 2,843
Walgreen 12,300 344
Wendy's International 5,100 108
Winn Dixie Stores 3,800 227
Woolworth 5,400 85
12,737
RUBBER & PLASTIC--0.8%
Armstrong World Industries 1,900 105
Cooper Tire & Rubber 4,000 97
Goodyear Tire & Rubber 7,600 299
Illinois Tool Works 5,800 341
Nike, Cl B 3,600 401
Premark International 3,200 163
Reebok International 3,900 134
Rubbermaid 7,700 213
1,753
SEMICONDUCTORS/INSTRUMENTS--2.1%
Advanced Micro Devices* 5,200 151
AMP 10,852 418
Intel 41,000 2,465
Micron Technology 10,300 819
National Semiconductor* 6,200 171
Texas Instruments 9,400 751
4,775
SERVICES - MOTION PICTURE & VIDEOTAPE
PRODUCTION--0.1%
Harrah's Entertainment* 5,100 $ 149
SPECIALTY MACHINERY--0.2%
Cooper Industries 5,328 188
Westinghouse Electric 19,500 292
480
STEEL & STEEL WORKS--1.1%
Alcan Aluminium 11,200 363
Aluminum Company of America 8,900 471
Armco* 12,200 79
Bethlehem Steel* 3,500 49
Englehard 7,112 180
Freeport-McMoran Copper & Gold,
Cl B* 10,100 259
Inco 5,900 202
Inland Steel Industries 2,100 48
Nucor 4,400 197
Phelps Dodge 3,500 219
Reynolds Metal 3,200 185
USX--U.S. Steel Group 4,100 127
Worthington Industries 3,150 58
2,437
TELEPHONES & TELECOMMUNICATION--8.4%
Airtouch Communications* 24,600 753
Alltel 9,400 281
Ameritech 27,600 1,439
AT&T 79,000 5,193
Bell Atlantic 21,700 1,332
Bellsouth 24,700 1,806
GTE 48,300 1,896
MCI Communications 33,800 881
NYNEX 21,300 1,017
Pacific Telesis Group 21,300 655
SBC Communications 30,300 1,667
Sprint 17,400 609
U.S. West 23,400 1,103
18,632
TRUCKING--0.1%
Consolidated Freightways 3,100 77
Pittston Services Group 2,000 54
Roadway Services 1,800 89
Yellow 1,500 21
241
WHOLESALE--0.6%
Alco Standard 2,800 237
Fleming 3,800 91
Genuine Parts 6,150 247
Potlatch 1,700 $ 69
Sigma Aldrich 2,400 116
Super-Valu 3,100 91
Sysco 9,100 249
W.W. Grainger 2,500 151
1,251
TOTAL COMMON STOCKS
(Cost $167,471) 214,298
U.S. TREASURY OBLIGATIONS--0.3%
U.S. Treasury Bill
5.383%, 12/14/95 (A) $ 600 593
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $594) 593
REPURCHASE AGREEMENTS--2.4%
Merrill Lynch 5.830%, dated 09/29/95,
matures 10/02/95, repurchase price
$5,258,106 (collateralized by various
U.S. Treasury Bills, total par value
$1,122,801, 03/07/96-09/19/96: U.S.
Treasury Bonds, total par value
$3,293,329, 7.625%-13.750%,
11/15/03-11/15/10: total market value
$5,360,768) 5,256 5,256
TOTAL REPURCHASE AGREEMENTS
(Cost $5,256) 5,256
TOTAL INVESTMENTS--99.1%
(Cost $173,321) 220,147
OTHER ASSETS AND LIABILITIES--0.9%
Other Assets and Liabilities, Net 2,122
NET ASSETS:
Portfolio shares--Institutional Class
($.0001 par value--2 billion authorized)
based on 16,409,292 outstanding shares $169,709
Portfolio shares--Retail Class A ($.0001
par value--2 billion authorized) based on
160,327 outstanding shares 1,784
Portfolio shares--Retail Class B ($.0001
par value--billion authorized) based on
89,979 outstanding shares 1,102
Undistributed net investment income 110
Accumulated net realized gain on investments 2,723
Net unrealized appreciation of investments 46,826
Net unrealized appreciation of futures contracts 15
TOTAL NET ASSETS:--100.0% $222,269
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION
PRICE PER SHARE--INSTITUTIONAL CLASS $ 13.34
NET ASSET VALUE AND REDEMPTION PRICE PER SHARE--
RETAIL CLASS A $ 13.35
MAXIMUM SALES CHARGE OF 4.50%+ 0.63
OFFERING PRICE PER SHARE--RETAIL CLASS A $ 13.98
NET ASSET VALUE AND OFFERING
PRICE PER SHARE--RETAIL CLASS B (1) $ 13.30
The accompanying notes are an integral part of the financial statements.
* Non-income producing security
+ The offer price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 4.50%.
(1) Retail Class B has a contingent deferred sales charge. For a description of
a possible redemption charge, see the notes to the financial statement.
(A) Security has been deposited as initial margin on open futures contract.
ADR--American Depository Receipt
FHLMC--Federal Home Loan Mortgage Corporation
FNMA--Federal National Mortgage Association
EQUITY INCOME FUND
Description Par (000)/Shares Value (000)
COMMON STOCKS--70.2%
BANKS--5.4%
Citicorp 19,808 $1,401
National City 52,000 1,606
3,007
CHEMICALS--1.9%
E.I. du Pont de Nemours 15,000 1,031
DRUGS--5.8%
Abbott Laboratories 32,000 1,364
Johnson & Johnson 17,000 1,260
Pfizer 11,000 587
3,211
ELECTRICAL SERVICES--5.0%
Detroit Edison 37,000 1,193
FPL Group 17,000 695
Unicom 29,000 877
2,765
FINANCIAL SERVICES--1.2%
American Express 15,000 666
FOOD, BEVERAGE & TOBACCO--7.4%
PepsiCo 16,000 816
Philip Morris 27,000 2,253
Sara Lee 35,000 1,041
4,110
GAS/NATURAL GAS--0.7%
Enron 11,000 369
HOUSEHOLD PRODUCTS--2.5%
Newell 56,000 1,386
INSURANCE--1.2%
Providian 16,000 664
MACHINERY--6.4%
General Electric 40,000 2,550
Tenneco 21,000 971
3,521
MINING--2.2%
Great Northern Iron Ore Properties 26,400 1,241
OIL - DOMESTIC--3.7%
Atlantic Richfield 19,000 2,040
OIL - INTERNATIONAL--7.4%
Amoco 14,000 $ 898
Exxon 17,500 1,264
Mobil 19,500 1,943
4,105
REAL ESTATE INVESTMENT TRUSTS--12.0%
Crescent Real Estate Equities 24,000 738
Healthcare Realty Trust 53,000 1,100
Manufactured Home Communities 56,000 966
National Golf Properties 63,000 1,378
Simon Property Group 52,000 1,320
Weeks 47,000 1,134
6,636
RAILROADS--1.8%
Union Pacific 15,000 994
RETAIL--3.6%
Albertson's 7,000 239
J.C. Penney 35,000 1,737
1,976
TELEPHONES & TELECOMMUNICATION--2.0%
AT&T 17,000 1,118
TOTAL COMMON STOCKS
(Cost $33,349) 38,840
PREFERRED CONVERTIBLE STOCKS--7.0%
AUTOMOTIVE--4.7%
Ford Motor, Ser A, $4.20 18,500 1,894
General Motors, Ser C, $3.25 11,000 714
2,608
BANKS--0.8%
Citicorp, Ser 15, $1.217 21,090 427
STEEL & STEEL WORKS--1.5%
AK Steel, $2.1525 28,000 847
TOTAL PREFERRED CONVERTIBLE STOCKS
(Cost $3,595) 3,882
PREFERRED STOCKS--0.6%
INSURANCE--0.6%
FHP International, Cl A 15,000 356
TOTAL PREFERRED STOCKS
(Cost $349) 356
CONVERTIBLE BONDS--11.3%
Conner Peripherals, 41.666 Shares
6.500%, 03/01/02 $1,575 $ 1,481
General Instrument, 42.1052 Shares
5.000%, 06/15/00 975 1,304
Integrated Health Services, 31.1284
Shares
6.000%, 01/01/03 650 673
Price, 44.3754 Shares
6.750%, 03/01/01 1,025 1,046
Vencor, 38.5615 Shares
6.000%, 10/01/02 1,400 1,742
TOTAL CONVERTIBLE BONDS
(Cost $6,222) 6,246
REPURCHASE AGREEMENTS--10.3%
J.P. Morgan 6.358%, dated 09/29/95,
matures 10/02/95, repurchase price
$2,532,614 (collateralized by U.S.
Treaury STRIPS, total par value
$7,923,891, 11/15/00-11/15/24, total
market value $2,581,913) 2,531 2,531
Merrill Lynch 5.830%, dated 09/29/95,
matures 10/02/95, repurchase price
$3,148,680 (collateralized by various
U.S. Treasury Bills, total par value
$672,360, 03/07/96-09/19/96: U.S.
Treasury Bonds, total par value
$1,972,124, 7.625%-13.750%,
11/15/03-11/15/10: total market value
$3,210,157) 3,147 3,147
TOTAL REPURCHASE AGREEMENTS
(Cost $5,678) 5,678
TOTAL INVESTMENTS--99.4%
(Cost $49,193) 55,002
OTHER ASSETS AND LIABILITIES--0.6%
Other Assets and Liabilities, Net 352
NET ASSETS:
Portfolio shares--Institutional Class ($.0001
par value--2 billion authorized) based on
4,636,094 outstanding shares $46,419
Portfolio shares--Retail Class A ($.0001 par
value--2 billion authorized) based on 177,562
outstanding shares 1,881
Portfolio shares--Retail Class B ($.0001 par
value--2 billion authorized) based on 110,137
outstanding shares 1,170
Undistributed net investment income 104
Accumulated net realized loss on investments (29)
Net unrealized appreciation of investments 5,809
TOTAL NET ASSETS:--100.0% $55,354
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION
PRICE PER SHARE--INSTITUTIONAL CLASS $ 11.24
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE--RETAIL CLASS A $ 11.24
MAXIMUM SALES CHARGE OF 4.50%+ 0.53
OFFERING PRICE PER SHARE--RETAIL CLASS A $ 11.77
NET ASSET VALUE AND OFFERING PRICE PER
SHARE--RETAIL CLASS B (1) $11.20
The accompanying notes are an integral part of the financial statements.
+ The offer price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 4.50%.
(1) Retail Class B has a contingent deferred sales charge. For a description of
possible redemption charge, see the notes to the financial statements.
STRIPS--Separately Trading of Registered Interest and Principle of
Securities
LIMITED VOLATILITY STOCK FUND
Description Shares Value (000)
COMMON STOCKS--92.3%
AEROSPACE & DEFENSE--2.7%
Lockheed Martin 7,000 $ 470
AIR TRANSPORTATION--2.6%
Southwest Airlines 17,500 442
AUTOMOTIVE--3.6%
Paccar 7,500 350
Stewart & Stevenson Services 8,300 268
618
BANKS--7.6%
Bank of New York 10,000 465
Boatmen's Bancshares 11,300 418
Wachovia 9,600 414
1,297
CHEMICALS--2.3%
PPG Industries 8,500 395
COMPUTERS & SERVICES--2.3%
IBM 4,200 396
DRUGS--7.9%
Eli Lilly 5,000 449
Mallinckrodt Group 10,800 428
Merck 8,400 471
1,348
ELECTRICAL SERVICES--8.1%
Delmarva Power & Light 16,200 371
Montana Power 13,700 317
Rochester Gas & Electric 13,500 319
Southwestern Public Service 11,600 378
1,385
FOOD, BEVERAGE & TOBACCO--2.4%
Hershey Foods 6,500 418
GAS/NATURAL GAS--1.8%
Pacific Enterprises 12,000 302
HOUSEHOLD PRODUCTS--2.6%
Clorox 6,300 450
INSURANCE--2.3%
Aon 9,650 394
MACHINERY--4.4%
Dresser Industries 14,800 353
General Electric 6,200 396
749
MEDICAL PRODUCTS & SERVICES--4.6%
Bausch & Lomb 7,300 $ 302
Baxter International 11,600 477
779
METALS & MINING--1.2%
Vulcan Materials 3,800 201
MISCELLANEOUS CONSUMER SERVICES--1.7%
Rollins 12,050 295
MULTI-INDUSTRY--2.6%
Harsco 8,000 445
OIL - INTERNATIONAL--7.6%
Amoco 7,300 468
Chevron 9,100 442
Mobil 4,000 399
1,309
PETROLEUM & FUEL PRODUCTS--2.2%
Questar 11,700 376
PRECIOUS METALS--2.3%
Barrick Gold 14,800 383
Santa Fe Pacific Gold 300 4
387
PRINTING & PUBLISHING--2.0%
Banta 8,100 344
RETAIL--4.3%
Albertson's 10,800 369
J.C. Penney 7,500 372
741
SEMI-CONDUCTORS/INSTRUMENTS--1.7%
Intel 4,800 289
SPECIALTY CONSTRUCTION--2.3%
Clayton Homes 16,600 394
STEEL & STEEL WORKS--4.5%
Carpenter Technology 11,200 438
Phelps Dodge 5,200 326
764
TELEPHONES & TELECOMMUNICATION--2.4%
U.S. West 8,800 415
WHOLESALE--2.3%
Genuine Parts 9,875 396
TOTAL COMMON STOCKS
(Cost $12,877) 15,799
U. S. TREASURY OBLIGATIONS--4.1%
U.S. Treasury Bill
6.183%, 10/19/95 $ 700 $ 698
TOTAL U. S. TREASURY OBLIGATIONS
(Cost $698) 698
CASH EQUIVALENTS--2.0%
AIM Short Term
Prime Obligation 347,654 348
TOTAL CASH EQUIVALENTS
(Cost $348) 348
TOTAL INVESTMENTS--98.4%
(Cost $13,923) 16,845
OTHER ASSETS AND LIABILITIES--1.6%
Other Assets and Liabilities, Net 280
NET ASSETS:
Portfolio shares--Institutional Class
($.0001 par value--2 billion authorized)
based on 1,438,464 outstanding shares 14,326
Undistributed net investment income 8
Accumulated net realized loss on
investments (131)
Net unrealized appreciation of
investments 2,922
TOTAL NET ASSETS:--100.0% $17,125
NET ASSET VALUE, OFFERING PRICE, AND
REDEMPTION PRICE PER SHARE--INSTITUTIONAL
CLASS $ 11.91
The accompanying notes are an integral part of the financial statements.
* Non-income producing security
DIVERSIFIED GROWTH FUND
Description Par (000)/Shares Value (000)
COMMON STOCKS--85.9%
AUTOMOTIVE--2.4%
Ford Motor 105,000 $3,268
BANKS--2.5%
BankAmerica 25,000 1,497
Citicorp 26,900 1,903
3,400
CHEMICALS--2.0%
E.I. du Pont de Nemours 41,000 2,819
COMMUNICATIONS EQUIPMENT--4.4%
Motorola 24,000 1,833
Nokia (ADR) 60,000 4,185
6,018
COMPUTERS & SERVICES--5.3%
Cisco Systems* 68,000 4,692
Compaq Computer* 27,000 1,306
Seagate Technology* 29,000 1,222
7,220
DRUGS--6.5%
Abbott Laboratories 78,000 3,325
Johnson & Johnson 41,000 3,039
Pfizer 47,000 2,509
8,873
ELECTRICAL SERVICES--1.0%
Detroit Edison 40,000 1,290
ENERGY & POWER--1.2%
Thermo Electron* 34,000 1,577
FINANCIAL SERVICES--4.8%
American Express 54,000 2,396
First Financial Management 5,000 488
FNMA 35,000 3,623
6,507
FOOD, BEVERAGE & TOBACCO--5.2%
Nabisco Holdings, Cl A 28,000 830
PepsiCo 37,000 1,887
Philip Morris 35,000 2,922
Sara Lee 47,000 1,398
7,037
GAS/NATURAL GAS--0.6%
Enron 24,000 804
HOUSEHOLD PRODUCTS--1.1%
Newell 59,000 1,460
INSURANCE--0.7%
United Healthcare 21,000 $1,026
MACHINERY--5.7%
Case Equipment 27,000 992
General Electric 69,000 4,399
Tenneco 51,000 2,359
7,750
MARINE TRANSPORTATION--0.2%
Royal Carribean Cruises 14,000 340
MEASURING DEVICES--0.5%
MTS Systems 26,000 735
MEDICAL PRODUCTS & SERVICES--4.8%
Columbia/HCA Healthcare 68,000 3,307
Medtronic 60,000 3,225
6,532
MISCELLANEOUS BUSINESS SERVICES--6.7%
General Motors, Cl E 27,000 1,229
Informix* 53,000 1,721
Novell* 71,000 1,296
Oracle Systems* 90,000 3,451
Synopsys* 16,000 492
The Bisys Group* 39,000 995
9,184
OIL - DOMESTIC--2.1%
Atlantic Richfield 27,000 2,899
OIL - INTERNATIONAL--4.7%
Amoco 30,000 1,924
Exxon 29,000 2,095
Mobil 16,000 1,594
Union Texas Petroleum 42,000 767
6,380
PAPER & PAPER PRODUCTS--1.4%
Weyerhaeuser 42,000 1,916
PRINTING & PUBLISHING--0.9%
News (ADR) 54,000 1,188
REAL ESTATE INVESTMENT TRUSTS--3.2%
Debartolo Realty 82,000 1,148
National Golf Properties 49,000 1,072
Simon Property Group 84,000 2,132
4,352
RAILROADS--1.7%
Southern Pacific Rail* 93,000 $ 2,255
RETAIL--6.2%
Dayton Hudson 26,000 1,973
J.C. Penney 53,000 2,630
McDonald's 85,000 3,251
Orchard Supply Hardware Stores* 41,000 595
8,449
SPECIALTY MACHINERY--2.2%
York International 73,000 3,075
STEEL & STEEL WORKS--1.9%
AK Steel Holding* 39,000 1,151
Inland Steel 37,000 842
Rouge Steel 23,500 546
2,539
TELEPHONES & TELECOMMUNICATION--4.5%
Airtouch Communications* 48,000 1,470
L.M. Ericsson Telephone (ADR) 58,000 1,421
Tele Danmark (ADR) 16,000 414
Vodafone (ADR) 71,000 2,911
6,216
TRUCKING--1.5%
Fritz* 28,000 2,063
TOTAL COMMON STOCKS
(Cost $95,561) 117,172
PREFERRED CONVERTIBLE STOCKS--0.4%
BANKS--0.4%
Citicorp, Ser 15, $1.217 24,010 486
TOTAL PREFERRED CONVERTIBLE STOCKS
(Cost $470) 486
CONVERTIBLE BONDS--1.6%
General Instrument, 42.1052 shares
5.000%, 06/15/00 $ 1,650 2,207
TOTAL CONVERTIBLE BONDS
(Cost $2,218) 2,207
REPURCHASE AGREEMENTS--11.6%
J.P. Morgan 6.358%, dated 09/29/95,
matures 10/02/95, repurchase price
$7,802,086 (collateralized by U.S.
Treasury STRIPS, total par value
$24,410,698, 11/15/00-11/15/24, total
market value $7,953,959) $7,798 $ 7,798
Merrill Lynch 5.830%, dated 09/29/95,
matures 10/02/95, repurchase price
$7,976,609 (collateralized by various
U.S. Treasury Bills, total par value
$1,703,302, 03/07/96-09/19/96: U.S.
Treasury Notes, total par value
$4,996,019, 7.625%-13.750%,
11/15/03-11/15/10: total market value
$8,132,349) 7,973 7,973
TOTAL REPURCHASE AGREEMENTS
(Cost $15,771) 15,771
TOTAL INVESTMENTS--99.5%
(Cost $114,020) 135,636
OTHER ASSETS AND LIABILITIES--0.5%
Other Assets and Liabilities, Net 747
NET ASSETS:
Portfolio Shares--Institutional Class (.0001
par value--2 billion authorized) based on
11,276,198 outstanding shares 112,233
Portfolio Shares--Retail Class A (.0001 par
value--2 billion authorized) based on 230,527
outstanding shares 2,416
Portfolio Shares--Retail Class B (.0001 par
value--2 billion authorized) based on 69,894
outstanding 762
Undistributed net investment income 146
Accumulated net realized loss on investments (790)
Net unrealized appreciation of investments 21,616
TOTAL NET ASSETS:--100.0% $136,383
NET ASSET VALUE, OFFERING PRICE, AND
REDEMPTION PRICE PER SHARE--INSTITUTIONAL CLASS $ 11.78
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE--RETAIL A $ 11.75
MAXIMUM SALES CHARGE OF 4.50%+ 0.55
OFFERING PRICE PER SHARE--RETAIL CLASS A $ 12.30
NET ASSET VALUE AND OFFERING
PRICE PER SHARE--RETAIL CLASS B (1) $ 11.73
The accompanying notes are an integral part of the financial statements.
* Non-income producing security
+ The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 4.50%.
(1) Retail Class B has a contingent deferred sales charge. For a description of
a possible redemption charge, see the notes to the financial statement.
ADR--American Depository Receipt
FNMA--Federal National Mortgage Association
STRIPS--Separately Trading of Registered Interest and Principal of
Securities
STOCK FUND
Description Par (000)/Shares Value (000)
COMMON STOCK--83.3%
AUTOMOTIVE--1.6%
General Motors 110,500 $ 5,180
BANKS--3.2%
Bay Banks 41,500 3,149
Chemical Banking 121,300 7,384
10,533
CHEMICALS--3.2%
Hercules 96,600 5,603
Olin 75,100 5,163
10,766
COMPUTERS & SERVICES--7.3%
Compaq Computer* 143,100 6,923
Cray Research* 218,100 4,825
Hewlett Packard 79,800 6,653
IBM 63,000 5,946
24,347
CONTAINERS & PACKAGING--1.4%
Ball 155,500 4,607
DRUGS--4.0%
American Home Products 86,900 7,376
Bristol-Myers Squibb 80,000 5,830
13,206
FINANCIAL SERVICES--1.5%
ITT 40,400 5,010
FOOD, BEVERAGE & TOBACCO--5.8%
ConAgra 186,700 7,398
Dole Food 188,900 6,541
Sara Lee 178,100 5,298
19,237
HOME APPLIANCES--1.0%
Whirlpool 58,100 3,355
INSURANCE--3.0%
AMBAC 129,800 5,711
General Re 29,100 4,394
10,105
LEISURE--2.0%
Brunswick 324,500 6,571
MACHINERY--6.3%
Briggs & Stratton 18,100 729
Case Equipment 193,300 7,104
Caterpillar 58,100 3,304
General Electric 107,200 6,834
York International 74,400 3,134
21,105
MULTI-INDUSTRY--2.5%
Minnesota Mining & Manufacturing 92,800 $ 5,243
U.S. Industries* 203,000 3,147
8,390
PAPER & PAPER PRODUCTS--4.3%
Bemis 185,800 5,133
James River 188,500 6,031
Scott Paper 67,600 3,279
14,443
PETROLEUM REFINING--9.8%
Amerada Hess 98,700 4,799
Exxon 65,300 4,718
Mobil 78,100 7,782
Royal Dutch Petroleum (ADR) 45,600 5,597
Texaco 65,100 4,207
Unocal 194,000 5,529
32,632
PHOTOGRAPHIC EQUIPMENT & SUPPLIES--3.8%
Eastman Kodak 124,400 7,371
Xerox 40,100 5,388
12,759
PRINTING & PUBLISHING--2.2%
Times Mirror, Cl A 249,400 7,170
REAL ESTATE INVESTMENT TRUSTS--5.1%
Debartolo Realty 278,000 3,892
Duke Realty Investments 104,000 3,237
Equity Residential Properties Trust 155,600 4,687
Simon Property Group 199,900 5,072
16,888
RAILROADS--3.5%
Consolidated Rail 80,300 5,521
CSX 74,500 6,267
11,788
RETAIL--6.0%
Dayton Hudson 66,700 5,061
Gap 135,900 4,892
Sears Roebuck 151,300 5,579
Wal-Mart Stores 179,400 4,463
19,995
SEMI-CONDUCTORS/INSTRUMENTS--2.0%
AMP 80,200 $ 3,088
Texas Instruments 43,500 3,474
6,562
STEEL & STEEL WORKS--1.2%
Aluminum Company of America 74,000 3,913
TELEPHONES & TELECOMMUNICATION--1.8%
Century Telephone Enterprises 200,900 6,102
WHOLESALE--0.8%
W.W. Grainger 46,000 2,777
TOTAL COMMON STOCK
(Cost $233,799) 277,441
MASTER NOTES--4.7%
Associates Corporation of North
America
5.708%, 10/02/95 (A) $ 5,717 5,717
Goldman Sachs
5.830%, 10/03/95 (A) 9,744 9,744
TOTAL MASTER NOTES
(Cost $15,461) 15,461
REPURCHASE AGREEMENTS--12.0%
J.P. Morgan 6.358%, dated 09/29/95,
matures 10/02/95, repurchase price
$18,251,112 (collateralized by various
U.S. Treasury STRIPS, total par value
$57,102,985, 05/15/00-05/15/24: total
market value $18,606,382) 18,241 18,241
Merrill Lynch 5.830%, date 09/29/95,
matures 10/02/95, repurchase price
$21,562,888 (collaterlized by various
U.S. Treasury Bills, total par value
$4,604,478, 03/07/96-09/19/96: U.S.
Treasury Bonds, total par value
$13,505,563, 7.625%-13.75%,
11/15/03-11/15/10: total market value
$21,983,894) 21,553 21,553
TOTAL REPURCHASE AGREEMENTS
(Cost $39,794) 39,794
TOTAL INVESTMENTS--100.0%
(Cost $289,054) 332,696
OTHER ASSETS AND LIABILITIES--0.0%
Other Assets and Liabilities, Net (10)
NET ASSETS:
Portfolio shares--Institutional Class
($.0001 par value--2 billion authorized)
based on 15,975,824 outstanding shares $253,795
Portfolio shares--Retail Class A ($.0001 par
value--2 billion authorized) based on 668,325
outstanding shares 10,526
Portfolio shares--Retail Class B ($.0001 par
value--2 billion authorized) based on 361,726
outstanding shares 6,547
Undistributed net investment income 235
Accumulated net realized gain on investments 17,941
Net unrealized appreciation of investments 43,642
TOTAL NET ASSETS:--100.0% $332,686
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION
PRICE PER SHARE--INSTITUTIONAL CLASS $ 19.56
NET ASSET VALUE AND REDEMPTION PRICE PER SHARE--
RETAIL CLASS A $ 19.57
MAXIMUM SALES CHARGE OF 4.50%+ 0.92
OFFERING PRICE PER SHARE--RETAIL CLASS A $ 20.49
NET ASSET VALUE AND OFFERING PRICE PER SHARE--
RETAIL CLASS B (1) $ 19.49
The accompanying notes are an integral part of the financial statements.
* Non-income producing security
+ The offer price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 4.50%.
(1) Retail Class B has a contingent deferred sales charge. For a description of
possible redemption charge, see the notes to the financial statements.
(A) Variable Rate Security with Demand Features--the rate reported on the
Statement of Net Assets is the rate in effect as of September 30, 1995. The
date shown is the longer of the reset or demand date.
ADR--American Depository Receipt
AMBAC--American Municipal Bond Assurance Company
STRIPS--Separately Trading of Registered Interest and Principal of
Securities
SPECIAL EQUITY FUND
Description Par (000)/Shares Value (000)
COMMON STOCK--73.8%
AGRICULTURE--1.6%
Pioneer Hi-Bred International 78,200 $3,597
AUTOMOTIVE--0.4%
Oshkosh Truck, Cl B 53,200 811
BANKS--0.6%
Chemical Banking 20,200 1,230
CHEMICALS--1.8%
IMC Global 63,600 4,031
COMMUNICATIONS EQUIPMENT--0.7%
Aydin* 84,400 1,456
CONSTRUCTION MATERIALS--0.8%
Lafarge 98,400 1,808
DRUGS--0.2%
Hauser Chemical Research* 93,400 531
ELECTRICAL UTILITIES--1.7%
Unicom 124,600 3,769
FINANCIAL SERVICES--0.7%
Carr Realty 77,200 1,448
MACHINERY--0.8%
Brown & Sharpe Manufacturing* 171,000 1,817
MARINE TRANSPORTATION--6.1%
London & Overseas Freighters (ADR) 40,300 589
Overseas Shipholding Group 229,600 4,563
Stolt-Nielsen 217,700 6,967
Teekay Shipping* 46,700 1,121
13,240
METALS & MINING--20.1%
AK Steel Holding* 129,100 3,808
Allegheny Ludlum 92,700 1,889
Aluminum Company of America 81,200 4,293
Asarco 168,000 5,292
Ashland Coal 75,100 2,262
Cleveland-Cliffs 41,200 1,694
Freeport-McMoran Copper & Gold 273,300 7,005
INCO 171,400 5,870
LTV* 235,200 3,293
Lukens 64,200 1,870
Phelps Dodge 36,600 2,292
Republic Engineered Steels* 113,000 848
Reynolds Metals 59,000 3,407
43,823
NATURAL GAS DISTRIBUTION--1.0%
MCN 115,500 2,281
OIL SERVICES--12.0%
Atwood Oceanic* 44,500 921
Baker Hughes 145,000 2,954
Dresser Industries 167,800 4,006
Halliburton 117,300 4,897
Helmerich & Payne 236,200 6,643
Horsham 458,000 $ 6,011
Pride Petroleum Services* 36,300 363
Stolt Comex Seaway* 36,100 393
26,188
OIL - DOMESTIC--14.8%
Amerada Hess 20,100 977
Anadarko Petroleum 67,700 3,207
Ashland 39,900 1,332
Diamond Shamrock 33,900 835
Holly 120,700 2,776
Louisiana Land & Exploration 121,200 4,318
Murphy Oil 34,700 1,388
Nuevo Energy* 47,500 1,069
Petrocorp* 40,800 337
Sun 34,206 881
USX-Marathon Group 357,300 7,055
Valero Energy 241,700 5,801
Wiser Oil 161,500 2,221
32,197
OIL - INTERNATIONAL--3.1%
Texaco 104,200 6,734
PRECIOUS METALS--6.5%
Coeur D'Alene Mines 149,800 3,033
Hecla Mining* 175,300 2,126
Hemlo Gold Mines 250,300 2,503
Newmont Mining 109,499 4,654
Santa Fe Pacific Gold 141,100 1,781
14,097
RETAIL--0.9%
Dayton Hudson 26,400 2,003
TOTAL COMMON STOCK
(Cost $146,045) 161,061
MASTER NOTES--8.4%
Associates Corporation of North America
5.708%, 10/02/95 (A) $ 8,735 8,735
Goldman Sachs
5.830%, 10/03/95 (A) 9,534 9,534
TOTAL MASTER NOTE
(Cost $18,269) 18,269
REPURCHASE AGREEMENT--16.9%
J.P. Morgan 6.358%, dated 09/29/95,
matures 10/02/95, repurchase price
$18,568,887 (collateralized by various
U.S. Treasury STRIPS, total par value
$58,097,221, 05/15/00-05/15/24: total
market value $18,930,343) 18,559 18,559
Merrill Lynch 5.830%, dated 09/29/95,
matures 10/02/95, repurchase price
$18,370,295, (collateralized by
various U.S. Treasury Bills, total par
value $3,922,741, 03/07/96-09/19/96:
U.S. Treasury Bonds, total par value
$11,505,934, 7.625%-13.75%,
11/15/03-11/15/10: total market value
$18,728,967) $ 18,361 $ 18,361
TOTAL REPURCHASE AGREEMENT
(Cost $36,920) 36,920
TOTAL INVESTMENTS--99.1%
(Cost $201,234) 216,250
OTHER ASSETS AND LIABILITIES--0.9%
Other Assets and Liabilities, Net 1,992
NET ASSETS:
Portfolio shares--Institutional Class
($.0001 par value--2 billion authorized)
based on 11,278,581 outstanding shares 173,630
Portfolio shares--Retail Class A ($.0001
par value--2 billion authorized) based on
648,950 outstanding shares 10,058
Portfolio shares--Retail Class B ($.0001
par value--2 billion authorized) based on
271,858 outstanding shares 4,525
Undistributed net investment income 75
Accumulated net realized gain on investments 14,938
Net unrealized appreciation of investments 15,016
TOTAL NET ASSETS:--100.0% $218,242
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION
PRICE PER SHARE--INSTITUTIONAL CLASS $ 17.89
NET ASSET VALUE AND REDEMPTION PRICE PER SHARE--
RETAIL CLASS A $ 17.89
MAXIMUM SALES CHARGE OF 4.50%+ 0.84
OFFERING PRICE PER SHARE--RETAIL CLASS A $ 18.73
NET ASSET VALUE AND OFFERING PRICE PER SHARE--
RETAIL CLASS B (1) $ 17.83
The accompanying notes are an integral part of the financial statements.
* Non-income producing security
+ The offer price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 4.50%.
(1) Retail Class B has a contingent deferred sales charge. For a description of
a possible redemption charge, see the notes to the financial statements.
(A) Variable Rate Security with Demand Features--the rate reported on the
Statement of Net Assets is the rate in effect as of September 30, 1995. The
date shown is the longer of the reset or demand date.
ADR--American Depository Receipt
STRIPS--Separately Trading of Registered Interest and Principal of
Securities
REGIONAL EQUITY FUND
Description Shares/Par (000) Value (000)
INVESTMENTS IN SECURITIES OF UNAFFILIATED
ISSUERS--80.5%
COMMON STOCKS--65.3%
APPAREL/TEXTILES--0.5%
Raven Industries 54,100 $ 974
AUTOMOTIVE--2.4%
Tower Automotive* 365,000 5,019
BANKS--5.6%
Community First Bankshares 250,000 4,813
TCF Financial 120,000 6,990
11,803
BROADCASTING, NEWSPAPERS &
ADVERTISING--1.2%
Lodgenet Entertainment* 240,000 2,520
CHEMICALS--0.6%
W.H. Brady 16,200 1,183
COMMUNICATIONS EQUIPMENT--3.1%
Communications Systems 440,000 6,490
COMPUTERS & SERVICES--9.7%
Control Data Systems* 450,000 5,456
Cray Research* 350,000 7,744
Digi International* 220,000 6,215
Netstar* 96,800 1,016
20,431
DRUGS--2.2%
Lifecore Biomedical* 350,000 4,681
ENVIRONMENTAL SERVICES--0.1%
Appliance Recycling Centers of
America* 34,300 223
FINANCIAL SERVICES--2.0%
General Growth Properties 200,000 4,125
FOOD, BEVERAGE & TOBACCO--4.7%
Grist Mill* 210,000 1,969
International Multifoods 190,000 4,085
Michael Foods 290,000 3,879
9,933
INSURANCE--0.6%
Crop Growers* 90,000 1,328
MACHINERY--8.2%
Alliant Techsystems* 50,000 2,350
BMC Industries 161,500 6,238
Donaldson 200,000 4,925
Pentair 85,000 3,825
17,338
MEDICAL--5.7%
Angeion* 555,000 4,163
ATS Medical* 186,400 1,631
Biovascular* 266,400 4,795
CNS* 58,900 773
Empi* 44,300 875
12,237
METALS & MINING--1.0%
Varlen 80,600 $ 2,196
MISCELLANEOUS BUSINESS SERVICES--3.1%
National Computer Systems 300,000 6,450
MISCELLANEOUS CONSUMER SERVICES--3.1%
Regis 300,000 6,450
MISCELLANEOUS TRANSPORTATION--0.7%
Arctco 120,000 1,530
PRINTING & PUBLISHING--1.9%
IPI* 198,300 793
Merrill 175,200 3,241
4,034
RETAIL--5.5%
Buffets* 178,700 2,234
Damark International, Cl A* 200,000 1,425
Fingerhut 350,000 5,644
Vicorp Restaurants* 200,000 2,400
11,703
SPECIALTY CONSTRUCTION--0.1%
Apogee Enterprises 19,500 293
TELEPHONES & TELECOMMUNICATION--0.9%
Marketlink* 485,000 1,841
WHOLESALE--2.4%
A.M. Castle 133,500 2,970
Hawkins Chemical 298,000 2,161
5,131
TOTAL COMMON STOCKS
(Cost $106,569) 137,913
CONVERTIBLE BONDS--0.8%
Hector Communications
8.500%, 02/15/02 $ 1,630 1,622
TOTAL CONVERTIBLE BONDS
(Cost $1,630) 1,622
WARRANTS--0.4%
ENTERTAINMENT--0.0%
Canterbury Park Holdings* 177,500 67
MEDICAL--0.4%
Angeion* 430,000 644
ATS Medical* 186,400 105
749
TOTAL WARRANTS
(Cost $196) 816
MASTER NOTES--4.0%
Associates Corporation of North America
5.708%, 10/02/95 (A) 2,304 2,304
Goldman Sachs
5.830%, 10/03/95 (A) 6,168 6,168
TOTAL MASTER NOTES
(Cost $8,472) $ 8,472
REPURCHASE AGREEMENTS--10.0%
J.P. Morgan 6.358%, dated 09/29/95,
matures 10/02/95, repurchase price
$10,186,211 (collateralized by various
U.S. Treasury STRIPS, total par value
$31,870,007, 11/15/00-11/15/24: total
market value $10,384,493) $ 10,181 10,181
Merrill Lynch 5.830%, dated 09/29/95,
matures 10/02/95, repurchase price
$10,948,751 (collateralized by various
U.S. Treasury Bills, total par value
$2,337,965, 03/07/96-09/19/96: U.S.
Treasury Bonds, total par value
$6,857,572, 7.625%-13.750%,
11/15/03-11/15/10: total market value
$11,162,521) 10,943 10,943
TOTAL REPURCHASE AGREEMENTS
(Cost $21,124) 21,124
TOTAL INVESTMENTS IN SECURITIES OF UNAFFILIATED
ISSUERS
(Cost $137,991) 169,947
INVESTMENTS IN COMMON STOCK OF AFFILIATES--19.6%
Aequitron Medical* (B) 360,000 3,330
Aetrium* (B) 680,000 14,618
Alternate Postal Delivery* (B) 241,900 1,391
Audio King* (B) 265,000 894
Canterbury Park Holdings* (B) 177,500 422
Deflecta-Shield* (B) 250,000 1,781
Dynamic Healthcare
Technologies* (B) 350,000 328
Navarre* (B) 260,000 2,210
Norstan* (B) 240,000 6,240
Orphan Medical* (B) 275,000 2,028
Rehabilicare* (B) 471,400 1,768
Rimage* (B) 235,000 1,630
TSI (B) 430,000 4,838
TOTAL INVESTMENTS IN COMMON STOCK OF AFFILIATES
(Cost $26,431) 41,478
TOTAL INVESTMENTS--100.1%
(Cost $164,422) 211,425
OTHER ASSETS AND LIABILITIES--(0.1)%
Other Assets and Liabilities, Net (295)
NET ASSETS:
Portfolio Shares--Institutional Class ($.0001 par
value-2 billion authorized) based on 11,006,811
outstanding shares 131,400
Portfolio Shares--Retail Class A ($.0001 par
value-2 billion authorized) based on 871,282
outstanding shares $ 10,222
Portfolio Shares--Retail Class B ($.0001 par
value-2 billion authorized) based on 449,114
outstanding shares 6,649
Undistributed net investment income 317
Accumulated net realized gain on investments 15,539
Net unrealized appreciation of investments 47,003
TOTAL NET ASSETS $211,130
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION
PRICE PER SHARE--INSTITUTIONAL CLASS $ 17.13
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE--RETAIL CLASS A $ 17.12
MAXIMUM SALES CHARGE OF 4.50%+ 0.81
OFFERING PRICE PER SHARE--RETAIL CLASS A $ 17.93
NET ASSET VALUE AND OFFERING PRICE PER
SHARE--RETAIL CLASS B (1) $ 16.99
The accompanying notes are an integral part of the financial statements.
* Non-income producing security
+ The offer price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 4.50%.
(1) Retail Class B has a contingent deferred sales charge. For a description of
a possible redemption charge, see the notes to the financial statements.
(A) Variable Rate Security--the rate reported on the Statement of Net Assets is
the rate in effect at September 30,1995. The date shown is the next reset
date.
(B) Investments are representing five percent or more of the outstanding voting
securities of the issuer, and is or was an affiliate, as defined in the
Investment Company Act of 1940 at or during the annual fiscal year ended
September 30, 1995. The activity for these securities is listed below.
Terrano Incorporated changed its name to Dynamic Healthcare Technologies
during the year.
<TABLE>
<CAPTION>
SHARES SHARES REALIZED
DESCRIPTION AT 9/30/94 AT 9/30/95 DIFFERENCE DIVIDENDS GAINS/LOSSES
<S> <C> <C> <C> <C> <C>
Aequitron
Medical -- 360,000 360,000 $ -- $ --
Aetrium 248,000 680,000 432,000 -- --
Alternate Postal
Delivery -- 241,900 241,900 -- --
Audio King 262,112 265,000 2,888 -- --
Canterbury Park
Holdings 177,500 177,500 -- -- --
Deflecta-Shield 101,100 250,000 148,900 -- --
Dynamic
Healthcare
Technologies 350,000 350,000 -- -- --
Navarre 152,200 260,000 107,800 -- --
Norstan 185,000 240,000 55,000 -- --
Northwest
Teleproductions 170,000 -- (170,000) -- (296,275)
Orphan Medical -- 275,000 275,000 -- --
Rehabilicare -- 471,400 471,400 -- --
Rimage 216,000 235,000 19,000 -- --
TSI 310,000 430,000 120,000 42,885 --
</TABLE>
The accompanying notes are an integral part of the financial statements.
STRIPS--Separately Trading of Registered Interest and Principal of
Securities.
EMERGING GROWTH FUND
Description Shares/Par (000) Value (000)
COMMON STOCK--89.0%
AEROSPACE & DEFENSE--1.1%
Tracor* 27,000 $ 446
APPAREL/TEXTILES--0.4%
Cutter & Buck* 24,000 177
AUTOMOTIVE--2.1%
Deflecta-Shield* 63,000 449
Tower Automotive* 34,000 467
916
BROADCASTING, NEWSPAPERS &
ADVERTISING--2.0%
Bell Cablemedia (ADR)* 20,000 365
National Wireless Holdings* 19,000 247
Pricellular, Cl A* 21,000 265
877
CHEMICALS--2.8%
Applied Extrusion Technologies* 29,000 533
Cambrex 13,000 523
H.B. Fuller 4,500 142
1,198
COMMUNICATIONS EQUIPMENT--7.2%
Checkpoint Systems* 19,000 501
Communications Systems 38,000 561
General Datacomm Industries* 12,000 177
Numerex, Cl A* 53,000 444
Picturetel* 9,000 407
Telebit* 24,000 105
Telewest Communications (ADR)* 6,000 183
Tellabs* 16,000 674
3,052
COMPUTERS & SERVICES--1.2%
Mackie Designs* 24,000 348
Mylex* 6,000 102
Netstar* 6,000 63
513
DRUGS--4.4%
Genzyme* 9,000 522
Idexx Labs* 36,000 1,341
1,863
ENERGY & POWER--0.9%
California Energy* 18,000 369
ENTERTAINMENT--0.7%
Avid Technology* 7,000 301
FINANCIAL SERVICES--7.9%
Advanta, Cl A 8,000 360
Advanta, Cl B 13,000 553
First USA 11,000 597
Fiserv* 24,000 692
SPS Transaction Services* 17,000 493
The Bisys Group* 25,200 643
3,338
HAZARDOUS WASTE MANAGEMENT--2.2%
Molton Metal Technology* 29,000 $ 939
HOUSEHOLD PRODUCTS--1.4%
Coleman* 16,000 600
INSURANCE--2.9%
Partnerre Holdings 15,000 371
Vesta Insurance Group 22,000 853
1,224
MACHINERY--0.8%
Shaw Group* 39,000 356
MEASURING DEVICES--0.7%
Quickturn Design Systems* 29,000 301
MEDICAL PRODUCTS & SERVICES--13.1%
American Medical Response* 11,000 312
ATS Medical* 58,100 508
Cerner* 12,000 411
HBO 13,000 813
Healthsource* 14,000 674
Quorum Health Group* 35,000 792
Target Therapeutics* 17,000 1,187
Vencor* 27,000 864
5,561
METALS & MINING--0.8%
Republic Engineered Steels* 43,000 323
METALWORKING, MACHINERY, & EQUIPMENT--2.6%
Greenfield Industries 23,000 707
Wolverine Tube* 10,000 379
1,086
MISCELLANEOUS BUSINESS SERVICES--3.5%
Keane* 20,000 578
Landmark Graphics* 26,000 733
Spectrum Holobyte* 15,000 189
1,500
MISCELLANEOUS FURNITURE & FIXTURES--0.4%
Falcon Building Products, Cl A* 20,000 175
OIL - DOMESTIC--2.1%
Belden & Blake* 25,200 479
Cairn Energy USA* 32,000 408
887
PRINTING & PUBLISHING--1.3%
Thomas Nelson 21,000 530
RETAIL--6.2%
Buffets* 18,000 225
Hometown Buffet* 36,000 504
Orchard Supply Hardware Stores* 26,000 377
Santa Isabel (ADR)* 21,000 454
Today's Man* 39,000 361
West Marine* 22,000 704
2,625
SEMI-CONDUCTORS/INSTRUMENTS--0.7%
Fusion Systems* 10,900 $ 319
SERVICES - SECURITY--1.2%
ITI Technologies* 18,000 488
SERVICES - PREPACKAGED SOFTWARE--9.3%
Aspen Technologies* 19,000 570
BTG* 58,000 580
Datalogix International* 20,000 285
Hyperion Software* 8,000 454
Imnet Systems* 22,500 579
National Instruments* 18,000 365
Network Peripherals* 28,000 441
Platinum Software* 19,000 221
Summit Medical Systems* 1,500 23
Transaction Systems Architects* 15,000 401
3,919
SPECIALTY CONSTRUCTION--0.9%
Insituform Mid-America Cl A 23,000 368
TELEPHONES & TELECOMMUNICATION--3.8%
A+ Communications* 24,000 366
American Paging* 19,000 147
Broadband Technologies* 11,000 237
International Cabletel* 30,000 840
1,590
TRUCKING--4.4%
Fritz* 12,500 921
Landstar System* 39,000 941
1,862
TOTAL COMMON STOCK
(Cost $31,780) 37,703
PREFERRED STOCKS--0.4%
MISCELLANEOUS BUSINESS SERVICES--0.4%
Network Imaging 11,000 184
TOTAL PREFERRED STOCKS
(Cost $181) 184
WARRANTS--0.1%
MEDICAL PRODUCTS & SERVICES--0.1%
ATS Medical* 43,000 24
TOTAL WARRANTS
(Cost $12) 24
REPURCHASE AGREEMENTS--10.1%
J.P. Morgan 6.358%, dated 09/29/95,
matures, 10/02/95, repurchase price
$1,967,540 (collateralized by various
U.S. Treasury STRIPS, total par value
$6,155,924, 05/15/00-05/15/24: total
market value $2,005,840) $ 1,966 1,966
Merrill Lynch 5.830%, dated 09/29/95,
matures 10/02/95, repurchase price
$2,338,497, (collateralized by various
U.S. Treasury Bills, total par value
$499,356, 03/07/96-09/19/96: U.S.
Treasury Bonds, total par value
$1,464,680, 7.625%-13.75%,
11/15/03-11/15/10: total market value
$2,384,156) $ 2,338 $ 2,338
TOTAL REPURCHASE AGREEMENT
(Cost $4,304) 4,304
TOTAL INVESTMENTS--99.6%
(Cost $36,277) 42,215
OTHER ASSETS AND LIABILITIES--0.4%
Other Assets and Liabilities, Net 155
NET ASSETS:
Portfolio shares--Institutional Class ($.0001 par
value--2 billion authorized) based on 3,111,893
outstanding shares 34,819
Portfolio shares--Retail Class A ($.0001 par
value--2 billion authorized) based on 28,829
outstanding shares 331
Portfolio shares--Retail Class B ($.0001 par
value--2 billion authorized) based on 20,143
outstanding shares 234
Undistributed net investment income 19
Accumulated net realized gain on investments 1,029
Net unrealized appreciation of investments 5,938
TOTAL NET ASSETS:--100.0% $42,370
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION
PRICE PER SHARE--INSTITUTIONAL CLASS $ 13.41
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE--RETAIL CLASS A $ 13.40
MAXIMUM SALES CHARGE OF 4.50%+ 0.63
OFFERING PRICE PER SHARE--RETAIL CLASS A $ 14.03
NET ASSET VALUE AND OFFERING PRICE PER
SHARE--RETAIL CLASS B (1) $ 13.29
The accompanying notes are an integral part of the financial statements.
* Non-income producing security.
+ The offer price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 4.50%.
(1) Retail Class B has a contingent deferred sales charge. For a description of
a possible redemption charge, see the notes to the financial statements.
ADR--American Depository Receipt
STRIPS--Separately Trading of Registered Interest and Principal of
Securities
TECHNOLOGY FUND
Description Shares/Par (000) Value (000)
COMMON STOCK--91.5%
COMMUNICATION SERVICES--0.4%
Performance Systems International* 500 $ 11
UUNET Technologies* 2,800 129
140
COMMUNICATIONS EQUIPMENT--21.3%
ACT Networks* 1,500 16
ADC Telecommunications* 11,700 532
Ascend Communications* 3,800 304
BroadBand Technologies* 12,100 260
DSC Communications* 21,800 1,293
General Datacomm Industries* 16,300 240
General Instrument* 14,700 441
L.M. Ericsson Telephone (ADR) 29,200 715
MRV Communications* 14,400 308
Nokia (ADR) 18,400 1,283
Picturetel* 11,600 525
Plaintree Systems* 16,000 136
Telebit* 31,100 136
Tellabs* 15,400 649
VideoServer* 3,700 130
6,968
COMPUTERS & SERVICES--16.2%
Cabletron Systems* 5,700 375
Cirrus Logic* 14,200 813
Cisco Systems* 22,300 1,540
Compaq Computer* 21,400 1,035
Concentra* 6,900 72
Convex Computer* 27,400 123
Diamond Multimedia Systems* 250 8
Mackie Designs* 16,000 232
Mylex* 6,500 111
NetStar* 6,500 68
Seagate Technology* 13,200 556
Silicon Graphics* 8,900 306
StorMedia* 1,800 81
5,320
SEMI-CONDUCTORS/INSTRUMENTS--12.8%
Adaptec* 9,900 408
ANADIGICS* 2,807 78
Applied Materials* 6,200 634
C.P. Clare* 700 18
Fusion Systems* 8,200 240
LSI Logic* 14,400 832
Micron Technology 13,400 1,065
Paradigm Technology* 200 6
Quickturn Design Systems* 21,000 218
S3* 10,700 373
SDL* 2,100 59
Solectron* 4,800 190
TelCom Semiconductor* 6,000 69
4,190
SERVICES - PREPACKAGED SOFTWARE--40.8%
ArcSys* 500 $ 21
Aspen Technologies* 12,300 369
Autodesk 12,200 534
Avid Technology* 6,000 258
Baan, N.V.* 9,500 428
BDM International* 2,700 74
BTG* 21,200 212
C*ATS Software* 500 4
CFI Proservices* 20,000 325
Checkfree* 2,000 40
Computer Associates International 11,650 492
Datalogix International* 26,800 382
Dataware Technologies* 8,100 103
Dendrite International* 10,600 162
Discreet Logic* 2,000 110
Firefox Communications* 1,000 25
Harbinger* 300 4
Hyperion Software* 8,400 477
Imnet Systems* 12,200 314
Inference* 5,300 80
Informix* 55,300 1,795
Legato Systems* 400 11
Macromedia* 5,200 297
McAfee Associates* 6,689 344
National Instruments* 16,700 338
Network Peripherals* 14,000 221
Novell* 21,200 387
ON Technology* 500 9
Oracle Systems* 36,000 1,382
Parametric Technology* 9,400 578
Peoplesoft* 8,400 763
Pinnacle Systems* 1,500 46
Platinum Technology* 14,800 307
Pure Software* 2,500 89
Seer Technology* 500 8
Smith Micro Software* 500 5
Softdesk* 8,200 207
Softkey International* 7,700 341
Spectrum Holobyte* 27,400 346
Spyglass* 100 5
Synopsys* 13,600 418
System Software Associates 14,200 570
TGV Software* 500 8
Transaction Systems Architects* 18,400 492
13,381
TOTAL COMMON STOCK
(Cost $23,247) 29,999
PREFERRED STOCKS--0.4%
SERVICES - PREPACKAGED SOFTWARE--0.4%
Network Imaging 6,800 114
TOTAL PREFERRED STOCKS
(Cost $128) 114
REPURCHASE AGREEMENTS--7.4%
J.P. Morgan 6.358%, dated 09/29/95,
matures 10/02/95, repurchase price
$1,025,274 (collateralized by various
U.S. Treasury STRIPS, total par value
$3,207,966, 11/15/00-11/15/24: total
market value $1,045,281) $1,025 $ 1,025
Merrill Lynch 5.830%, dated 09/29/95,
matures 10/02/95, repurchase price $1,385,418
(collateralized by various U.S. Treasury Bills,
total par value $295,838, 03/07/96-09/19/95:
U.S. Treasury Bonds, total par value $867,734,
7.625%-13.750%, 11/15/03-11/15/10: total market
value $1,412,467) 1,385 1,385
TOTAL REPURCHASE AGREEMENTS (Cost $2,410) 2,410
TOTAL INVESTMENTS--99.3% (Cost $25,785) 32,523
OTHER ASSETS AND LIABILITIES--0.7%
Other Assets and Liabilities, Net 244
NET ASSETS:
Portfolio shares--Institutional Class
($.0001 par value--2 billion shares authorized)
based on 1,605,061 outstanding shares 19,697
Portfolio shares--Retail Class A
($.0001 par value--2 billion authorized)
based on 80,253 outstanding shares 1,250
Portfolio shares--Retail Class B ($.0001
par value--2 billion authorized) based on
112,734 outstanding shares 1,788
Accumulated net realized gain on investments 3,294
Net unrealized appreciation of investments 6,738
TOTAL NET ASSETS:--100.0% $32,767
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION PRICE
PER SHARE--INSTITUTIONAL CLASS $ 18.24
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE--RETAIL CLASS A $ 18.24
MAXIMUM SALES CHARGE OF 4.50%+ 0.86
OFFERING PRICE PER SHARE--RETAIL CLASS A $ 19.10
NET ASSET VALUE AND OFFERING PRICE PER
SHARE--RETAIL CLASS B (1) $ 18.02
The accompanying notes are an integral part of the financial statements.
* Non-income producing security
+ The offer price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 4.50%
(1) Retail Class B has a contingent deferred sales charge. For a description of
a possible redemption charge, see the notes to the financial statement.
ADR--American Depository Receipt
STRIPS--Separately Trading of Registered Interest and Principal of
Securities
INTERNATIONAL FUND
Description Shares/Par (000) Value (000)
FOREIGN COMMON STOCKS--91.7%
ARGENTINA--1.8%
Banco Frances Rio Plata (ADR) 15,700 $ 340
Cementera Argentina* 100,000 435
Commercial del Plata* 79,000 186
Dycasa Dragados, Cl B 60,000 141
Irsa, Cl B* 113,450 270
Polledo* 140,000 96
Quilmes Industrial 12,300 227
1,695
AUSTRALIA--0.8%
Newscorp 135,800 755
CHILE--0.4%
Madeco (ADR) 10,000 235
Santa Isabel (ADR) 8,200 177
412
FINLAND--5.0%
Nokia, Cl A 68,000 4,772
FRANCE--1.9%
Axa 7,950 420
Business Objects (ADR)* 6,700 285
Castorama 1,705 278
Cie Bancaire 3,965 370
SGS-Thomson (ADR)* 9,300 452
1,805
GERMANY--1.3%
Siemens 875 440
Veba 20,250 802
1,242
HONG KONG--5.5%
Cheung Kong Holdings 115,000 626
Citic Pacific 157,700 476
First Pacific 1,699,000 1,813
HSBC Holdings 92,200 1,282
Hutchison Whampoa 85,000 461
Sun Hung Kai Properties 69,000 560
5,218
INDIA--0.7%
East India Hotels (A) (GDR)* 7,100 135
I.T.C. (A) (ADR)* 46,500 418
Ranbaxy Laboratories (A) (GDR) 5,500 154
707
INDONESIA--1.1%
Indonesian Satellite (ADR) 30,000 1,054
IRELAND--0.4%
Elan (ADR)* 10,000 $ 415
ISRAEL--0.4%
ECI Telecommunications 16,000 358
ITALY--2.3%
Assicurazioni Generali 18,000 416
Falck* 100,000 245
Fila Holdings (ADR) 8,000 283
Instituto Mobiliare 22,000 132
Mediobanca 28,000 208
Telecom Italia 539,000 899
2,183
JAPAN--25.2%
Advantest 19,000 1,123
Alpine Electronics 26,000 399
Best Denki 11,000 166
Bridgestone 26,000 386
Canon 13,000 232
Canon Sales 6,000 155
Daini Denden 210 1,733
Daiwa Securities 57,000 719
Fanuc 4,000 178
Hirose Electric 6,300 395
Ito Yokado 20,000 1,106
Keyence 3,800 472
KOA 35,000 554
Kokusai Electric 31,000 707
Komatsu 48,000 386
Kubota 62,000 418
Kurita Water Industries 9,000 245
Kyocera 24,000 1,974
Makita 13,000 206
Marui 14,000 261
Matsushita Electric 16,000 245
Mitsubishi Electric 34,000 266
Mitsubishi Estate 54,000 605
Mitsubishi Trust & Banking 16,000 250
Mitsui Fudosan 40,000 480
Murata Manufacturing 26,000 976
NEC 141,000 1,965
Nikon 75,000 969
Nippon Telegraph & Telephone 36 310
Nissan Motors 41,000 295
Nomura Securities 33,000 646
NTT Data Communications 19 443
Sankyo 8,000 182
Sanwa Bank 25,000 469
Sharp 33,000 463
Sony 8,000 415
Sumitomo Bank 18,000 349
Sumitomo Trust & Banking 35,000 $ 480
TDK 4,000 206
Tokyo Electronics 30,000 1,305
Toray 50,000 304
Toyota Motor 19,000 362
Ushio 16,000 177
Yamanouchi Pharmaceutical 8,000 173
24,150
LUXEMBOURG--0.2%
Millicom International* 6,000 193
MALAYSIA--3.5%
Arab-Malaysian Merchant Bank 98,000 1,210
Malayan Banking 53,000 428
New Straits Times Press 100,000 283
Sime Darby Malaysia 125,000 333
Technology Resources* 296,000 772
United Engineers, F 55,000 353
3,379
MEXICO--2.6%
Bufete Industrial (ADR)* 10,500 169
Cemex, Cl A 51,750 218
Cifra 117,000 146
Grupo Carso (ADR)* 17,400 191
Grupo Financiero Banamex, Cl B 170,000 340
Grupo Financiero Banamex, Cl L 8,500 17
Grupo Financiero Inbursa, Cl C 200,000 631
Grupo Iusacell (ADS)* 15,510 202
Grupo Modelo 34,000 138
Grupo Posadas, Cl A* 600,000 235
Grupo Synkro (ADR)* 250,000 69
Kimberly Clark, Cl A 11,000 147
2,503
NETHERLANDS--4.1%
Advanced Semi-Conductor (ADR)* 4,800 242
ASM Litho Holdings (ADR)* 12,000 526
Baan (ADR)* 16,000 720
Elsevier 18,500 237
Getronics 3,800 187
International Nederlanden 4,200 244
Madge Networks (ADR)* 8,300 266
Philips Electronics 8,800 429
Polygram 10,000 650
Wolters Kluwer 4,200 385
3,886
NEW ZEALAND--0.8%
Telecom New Zealand (ADR) 13,100 809
NORWAY--1.3%
Hafslund Nycomed, Cl B 10,000 $ 259
Petroleum Geo-Services (ADR)* 39,300 963
1,222
PERU--2.2%
Banco de Credito del Peru, Cl C 122,000 229
Banco Wiese (ADR) 53,748 363
Cementos Norte Pacasmayo 50,000 117
Cia de Minas Buenaventura, Cl T 33,883 193
Cia Peruana de Telefonos, Cl B 481,559 927
El Pacifico Peruana Suiza 8,431 207
Telefonos 2000* 73,899 72
2,108
PHILIPPINES--0.7%
San Miguel, Cl B 181,000 639
SINGAPORE--2.6%
Cerebos Pacific 40,000 239
City Developments 87,600 542
Creative Technology (ADR)* 8,600 117
Flextronics (ADR)* 12,200 314
Singapore Press, F 12,000 184
Straits Steamship Land 104,000 285
United Overseas Bank, F 88,640 768
2,449
SOUTH KOREA--3.4%
Korea Fund 20,750 459
Korea Mobile Telecom (A) (GDR)* 18,900 671
Samsung Electric Non-Voting (GDS)
New* 1,781 107
Samsung Electric Non-Voting (GDS)* 28,400 1,989
Samsung Electric Voting (GDR) New* 70 8
Samsung Electric Voting (GDR) New* 135 15
Samsung Electric Voting (A) (GDR)* 354 42
3,291
SWEDEN--7.7%
Allgan Free, Cl B 20,300 454
Asea Free, Cl B 9,950 987
Astra Free, Cl B 26,200 922
Autoliv 14,500 884
Ericsson Telephone (ADR) 168,000 4,116
7,363
SWITZERLAND--4.1%
Brown Boveri & Cie Bearer 375 434
Ciba Geigy 450 361
Roche Holdings 230 1,624
Sandoz Pharmaceutical 1,940 1,477
3,896
THAILAND--1.8%
Advanced Info Service, F 57,000 $ 897
Land And House, F 9,400 148
Total Access Communications (ADR)* 50,000 313
United Communication 25,000 325
1,683
UNITED KINGDOM--9.9%
B.A.T. 24,000 200
Barclays Bank 41,000 485
British Sky Broadcasting (ADR) 45,000 1,627
Commercial Union 47,600 440
GlaxoWellcome 52,000 630
Logica 31,000 239
Next 104,400 669
Reuters 103,900 917
Smithkline Beecham 127,900 1,270
Takare 82,400 289
Tele-Communications (ADR), Cl A 49,200 917
Vodafone Group 157,800 662
WPP Group 87,300 205
Zeneca Group 56,000 1,012
9,562
TOTAL FOREIGN COMMON STOCKS
(Cost $78,518) 87,749
FOREIGN PREFERRED STOCKS--2.0%
GERMANY--2.0%
SAP 11,500 1,871
TOTAL FOREIGN PREFERRED STOCKS
(Cost $1,433) 1,871
REPURCHASE AGREEMENT--6.4%
Merrill Lynch 5.830%, dated 9/29/95,
matures 10/2/95, repurchase price
$6,080,345 (collateralized by various
U.S. Treasury Bills, total par value
$1,298,379, 3/07/96 - 9/19/96: U.S.
Treasury Bonds, total par value
$3,808,324, 8.250% - 13.750%,
11/15/03 - 11/15/10: total market
value $6,199,061) $ 6,077 6,077
TOTAL REPURCHASE AGREEMENT
(Cost $6,077) 6,077
TOTAL INVESTMENTS--100.1%
(Cost $86,028) 95,697
OTHER ASSETS AND LIABILITIES--(0.1%)
OTHER ASSETS AND LIABILITIES, NET (115)
NET ASSETS:
Portfolio shares of
Institutional ($.0001
par value--2 billion
authorized) based on
9,166,192 outstanding
shares $89,600
Portfolio shares of
Retail class A
($.0001 par value--2
billion authorized)
based on 85,174
outstanding shares 832
Portfolio shares of
Retail class B
($.0001 par value--2
billion authorized)
based on 30,086
outstanding shares 284
Undistributed net
investment income 1,609
Accumulated net
realized loss on
investments and
foreign currency
transactions (6,170)
Net unrealized
depreciation on
forward foreign
currency contracts,
foreign currency and
translation of other
assets and
liabilities in
foreign currency (242)
Net unrealized
appreciation on
investments 9,669
TOTAL NET
ASSETS:--100.0% $95,582
NET ASSET VALUE,
OFFERING PRICE AND
REDEMPTION PRICE PER
SHARE--INSTITUTIONAL
CLASS $ 10.30
NET ASSET VALUE AND
REDEMPTION PRICE PER
SHARE--RETAIL CLASS A $ 10.28
MAXIMUM SALES CHARGE
OF 4.50%+ 0.48
OFFERING PRICE PER
SHARE--RETAIL CLASS A $ 10.76
NET ASSET VALUE AND
OFFERING PRICE PER
SHARE--RETAIL CLASS B (1) $ 10.20
The accompanying notes are an integral part of the financial statements.
* Non-income producing security
+ The offer price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 4.50%.
(1) Retail Class B has a contingent deferred sales charge. For a description of
a possible redemption charge, see the notes to the financial statement.
(A) Securities sold within terms of a private placement memorandum, exempt from
registration under Section 144A of the Securities Act of 1993, as amended,
and may be sold only to dealers in that program or other "accredited
investors." These securities have been determined to be liquid under the
guidelines established by the Board of Directors.
ADR--American Depository Receipts
ADS--American Depository Shares
GDR--Global Depository Receipts
GDS--Global Depository Shares
F--Foreign Registry Shares
REAL ESTATE SECURITIES FUND
Description Shares/Par (000) Value (000)
COMMON STOCK--95.7%
REAL ESTATE INVESTMENT TRUSTS--95.7%
HEALTHCARE FACILITIES--11.3%
Health & Retirement Property Trust 10,700 $ 167
Health Care Property Investors 5,100 173
National Health 4,500 136
Nationwide Health Properties 4,300 176
652
HOTELS--3.2%
Hospitality Properties Trust 7,000 184
OFFICE/INDUSTRIAL--33.7%
Cali Realty 12,400 251
Duke Realty Investments 4,500 140
Highwoods Properties 7,200 190
Liberty Property Trust 11,300 240
Security Capital Industrial Trust 10,000 163
Shurgard Storage Centers 6,200 154
Sovran Self Storage 5,600 139
Spieker Properties 10,500 251
Storage Trust 5,000 102
Storage USA 5,700 176
Weeks 5,500 133
1,939
RESIDENTIAL--25.3%
Bay Apartment Communities 6,600 142
Chateau Properties 4,000 87
Equity Residential Properties Trust 8,100 244
Evans Withycombe Residential 8,100 164
Post Properties 3,800 118
ROC Communities 5,900 136
Summit Properties 11,700 221
Sun Communities 5,500 143
Wellsford Real Estate 9,500 203
1,458
RETAIL--22.2%
CBL & Associates Properties 6,000 125
DeBartolo Realty 8,400 118
Developers Diversified Realty 5,600 167
Excel Realty Trust 6,000 119
Federal Realty Investment Trust 6,000 140
JDN Realty 6,000 128
Macerich 6,200 132
Mid-America Realty Investments 14,400 113
Simon Property Group 4,800 122
Weingarten Realty Investors 3,200 113
1,277
TOTAL COMMON STOCK
(Cost $5,340) 5,510
REPURCHASE AGREEMENT--7.7%
Merrill Lynch 5.830%, dated 09/29/95,
matures 10/02/95, repurchase price
$443,780, (collateralized by various
U.S. Treasury Bills, total par value
$94,764, 03/07/96-09/19/96: U.S.
Treasury Bonds, total par value $277,955,
7.625%-13.750%, 11/15/03-11/15/10: total
market value $452,445) $444 $ 444
TOTAL REPURCHASE AGREEMENT (Cost $444) 444
TOTAL INVESTMENTS--103.4% (Cost $5,784) 5,954
OTHER ASSETS AND LIABILITIES--(3.4%)
Other Assets and Liabilities, Net (196)
NET ASSETS:
Portfolio shares--Institutional Class
($.0001 par value--2 billion authorized)
based on 555,059 outstanding shares 5,575
Portfolio shares--Retail Class A ($.0001
par value--2 billion authorized) based on
92 outstanding shares 1
Portfolio shares--Retail Class B ($.0001
par value--2 billion authorized) based on
96 outstanding shares 1
Undistributed net investment income 11
Net unrealized appreciation of investments 170
TOTAL NET ASSETS:--100.0% $5,758
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION
PRICE PER SHARE--INSTITUTIONAL CLASS $10.37
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE--RETAIL CLASS A $10.38
MAXIMUM SALES CHARGE OF 4.50%+ 0.49
OFFERING PRICE PER SHARE $10.87
NET ASSET VALUE AND OFFERING PRICE PER
SHARE--RETAIL CLASS B (1) $10.38
The accompanying notes are an integral part of the financial statements.
+ The offer price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 4.50%.
(1) Retail Class B has a contingent deferred sales charge. For a description of
a possible redemption charge, see the notes to the financial statement.
STATEMENTS OF OPERATIONS (000)
For the period ended September 30, 1995
<TABLE>
<CAPTION>
PRIME GOVERNMENT TREASURY
OBLIGATIONS OBLIGATIONS OBLIGATIONS
FUND FUND FUND
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest $107,082 $42,675 $53,757
EXPENSES:
Investment advisory fees 7,154 2,881 3,996
Distribution Fees -- Institutional Class 571 263 --
Distribution fees -- Retail Class A 140 -- --
Distribution Fees -- Corporate Trust
Class 7 200 982
Administrator fees 1,252 504 656
Custodian fees 538 216 281
Registration fees 660 157 267
Professional fees 201 76 110
Transfer agent fees 117 51 63
Printing 60 42 43
Directors' fees 56 23 28
Amortization of organizational costs 2 2 --
Other 118 38 46
TOTAL EXPENSES 10,876 4,453 6,472
LESS: EXPENSES WAIVED (2,689) (1,009) (902)
TOTAL NET EXPENSES 8,187 3,444 5,570
INVESTMENT INCOME--NET 98,895 39,231 48,187
NET REALIZED GAIN (LOSS) ON INVESTMENTS 3 (36) 31
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $ 98,898 $39,195 $48,218
</TABLE>
The accompanying notes are an integral part of the financial statements.
For the period ended September 30, 1995
<TABLE>
<CAPTION>
LIMITED INTERMEDIATE FIXED
TERM TERM INCOME
INCOME FUND INCOME FUND FUND
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest $ 6,700 $5,440 $13,903
EXPENSES:
Investment advisory fees 749 573 1,395
Administrator fees 149 118 275
Transfer agent fees 22 21 35
Amortization of organizational costs 4 4 --
Custodian fees 14 7 15
Directors' fees 3 3 5
Registration fees 26 12 87
Professional fees 19 9 21
Printing 41 17 35
Distribution fees--Retail Class A 24 7 18
Distribution fees--Retail Class B -- -- 24
Other 13 8 17
TOTAL EXPENSES 1,064 779 1,927
LESS: EXPENSES WAIVED OR ABSORBED (422) (206) (497)
TOTAL NET EXPENSES 642 573 1,430
INVESTMENT INCOME--NET 6,058 4,867 12,473
REALIZED AND UNREALIZED GAINS (LOSSES) ON
INVESTMENTS--NET:
Net realized gain (loss) on investments (1,327) 542 3,351
Net change in unrealized appreciation of investments 2,575 3,016 9,685
NET GAIN (LOSS) ON INVESTMENTS 1,248 3,558 13,036
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 7,306 $8,425 $25,509
</TABLE>
(table continued)
<TABLE>
<CAPTION>
MINNESOTA
LIMITED COLORADO INSURED
INTERMEDIATE MORTGAGE TERM TAX INTERMEDIATE INTERMEDIATE INTERMEDIATE
GOVERNMENT SECURITIES FREE INCOME TAX FREE TAX FREE TAX FREE
BOND FUND FUND FUND FUND FUND FUND
<S> <C> <C> <C> <C> <C>
$5,520 $1,926 $ 634 $1,587 $2,251 $2,942
566 197 100 206 284 377
111 50 50 50 57 74
21 20 19 19 20 20
-- 4 7 -- 5 6
8 6 4 9 12 16
2 1 1 1 1 1
35 3 1 16 19 18
11 4 6 4 4 6
14 8 8 3 5 10
5 1 2 2 3 5
-- -- -- -- -- --
6 4 3 2 3 4
779 298 201 312 413 537
(214) (100) (116) (114) (129) (160)
565 198 85 198 284 377
4,955 1,728 549 1,389 1,967 2,565
(76) 32 14 376 234 214
3,665 1,379 138 1,232 2,043 2,478
3,589 1,411 152 1,608 2,277 2,692
$8,544 $3,139 $ 701 $2,997 $4,244 $5,257
</TABLE>
The accompanying notes are an integral part of the financial statements.
For the period ended September 30, 1995
<TABLE>
<CAPTION>
LIMITED
ASSET EQUITY EQUITY VOLATILITY
ALLOCATION BALANCED INDEX INCOME STOCK
FUND FUND FUND FUND FUND (1)
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest $1,245 $ 5,139 $ 422 $ 519 $ 70
Dividends 599 2,249 4,610 1,499 385
Less: Foreign taxes withheld -- -- -- -- --
Total investment income 1,844 7,388 5,032 2,018 455
EXPENSES:
Investment advisory fees 299 1,175 1,277 290 91
Administrator fees 63 240 262 57 44
Transfer agent fees 29 39 36 27 6
Amortization of organizational costs 5 4 4 10 2
Custodian fees 12 17 22 12 4
Directors' fees 2 5 6 1 --
Registration fees 1 30 36 15 5
Professional fees 4 17 22 10 2
Printing 12 39 45 11 2
Distribution fees--Retail Class A 2 35 3 5 --
Distribution fees--Retail Class B 2 11 3 3 --
Other 6 14 20 4 1
TOTAL EXPENSES 437 1,626 1,736 445 157
LESS: EXPENSES WAIVED OR ABSORBED (97) (262) (1,091) (128) (60)
TOTAL NET EXPENSES 340 1,364 645 317 97
INVESTMENT INCOME (LOSS)--NET 1,504 6,024 4,387 1,701 358
REALIZED AND UNREALIZED GAINS (LOSSES)
ON INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS--NET:
Net realized gain (loss) on investments 1,590 7,484 1,499 435 (131)
Net realized gain on futures contracts -- -- 1,525 -- --
Net realized gain on forward foreign currency contracts
and foreign currency transactions -- -- -- -- --
Net change in unrealized appreciation of investments 4,397 18,934 40,664 5,876 2,922
Net change in unrealized appreciation on futures
contract -- -- 15 -- --
Net change in unrealized depreciation on forward foreign
currency contracts, foreign currency and translation
of other assets and liabilities in foreign currency -- -- -- -- --
NET GAIN ON INVESTMENTS 5,987 26,418 43,703 6,311 2,791
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $7,491 $32,442 $48,090 $8,012 $3,149
</TABLE>
(table continued)
<TABLE>
<CAPTION>
REAL
DIVERSIFIED SPECIAL REGIONAL EMERGING ESTATE
GROWTH STOCK EQUITY EQUITY GROWTH TECHNOLOGY INTERNATIONAL SECURITIES
FUND FUND FUND FUND FUND FUND FUND FUND (2)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$ 508 $ 1,676 $ 2,559 $ 1,125 $ 178 $ 22 $ 312 $ 8
1,497 5,358 3,070 1,181* 50 70 1,094 70
-- -- -- -- -- -- (110) --
2,005 7,034 5,629 2,306 228 92 1,296 78
574 1,705 1,241 995 153 121 869 8
111 341 252 200 50 50 95 13
30 45 46 42 28 28 30 2
9 -- -- 4 5 5 5 1
25 29 17 15 7 5 193 --
2 7 5 4 1 1 2 --
35 71 43 32 12 8 23 2
16 28 21 14 2 2 10 --
21 51 40 31 3 3 14 1
5 25 22 26 -- 1 1 --
3 24 23 22 1 5 1 --
8 23 18 13 1 1 20 --
839 2,349 1,728 1,398 263 230 1,263 27
(218) (378) (128) (160) (77) (71) (49) (18)
621 1,971 1,600 1,238 186 159 1,214 9
1,384 5,063 4,029 1,068 42 (67) 82 69
2,291 17,763 15,970 16,157* 1,122 3,397 (5,987) --
-- -- -- -- -- -- -- --
-- -- -- -- -- -- 1,921 --
21,333 35,581 4,572 37,100* 5,699 6,007 8,360 170
-- -- -- -- -- -- -- --
-- -- -- -- -- -- (202) --
23,624 53,344 20,542 53,257 6,821 9,404 4,092 170
$25,008 $58,407 $24,571 $ 54,325 $6,863 $9,337 $ 4,174 $239
</TABLE>
The accompanying notes are an integral part of the financial statements.
* Includes the following amounts due to Investments in Common Stocks of
Affiliates (000): $43 of dividend income, $296 of realized gains, and
$14,582 of change in unrealized appreciation of investments.
(1) The Limited Volatility Stock Fund commenced operations on November 15,
1994.
(2) The Real Estate Securities Fund commenced operations on June 30, 1995.
STATEMENTS OF CHANGES IN NET ASSETS (000)
<TABLE>
<CAPTION>
PRIME GOVERNMENT TREASURY
OBLIGATIONS FUND OBLIGATIONS FUND OBLIGATIONS FUND
10/1/94 10/1/93 10/1/94 10/1/93 10/1/94 10/4/93(1)
TO TO TO TO TO TO
9/30/95 9/30/94 9/30/95 9/30/94 9/30/95 9/30/94
<S> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Investment income--net $ 98,895 $ 35,066 $ 39,231 $ 11,389 $ 48,187 $ 18,457
Net realized gain (loss) on investments 3 -- (36) 42 31 --
Net increase in net assets resulting
from operations 98,898 35,066 39,195 11,431 48,218 18,457
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Investment income--net
Institutional class (95,604) (35,064) (31,983) (11,389) (1,945) --
Retail class A (3,049) -- -- -- -- --
Retail class B -- -- -- -- -- --
Corporate Trust class (244) -- (7,248) -- (46,242) (18,457)
Net realized gain on investments
Institutional class -- -- -- (17) -- --
Retail class A -- -- -- -- -- --
Retail class B -- -- -- -- -- --
Corporate Trust class -- -- -- -- -- --
Total distributions (98,897) (35,064) (39,231) (11,406) (48,187) (18,457)
CAPITAL SHARE TRANSACTIONS
AT NET ASSET VALUE OF $1.00 PER SHARE:
Institutional Class
Proceeds from sales 11,741,658 7,496,942 4,886,718 3,213,046 417,680 --
Reinvestment of distributions 33,427 13,344 16,078 5,280 1,201 --
Payments for redemptions (10,171,378) (6,885,929) (4,807,345) (2,999,813) (301,711) --
Increase in net assets from
Institutional Class transactions 1,603,707 624,357 95,451 218,513 117,170 --
Retail Class A:
Proceeds from sales 105,193 -- -- -- -- --
Shares issued in connection with
acquisition of Money Fund 63,816 -- -- -- -- --
Reinvestment of distributions 2,635 -- -- -- -- --
Payments for redemptions (75,561) -- -- -- -- --
Increase in net assets from Retail Class A
transactions 96,083 -- -- -- -- --
Retail Class B:
Proceeds from sales 14 -- -- -- -- --
Reinvestment of distributions -- -- -- -- -- --
Payments for redemptions -- -- -- -- -- --
Increase in net assets from Retail Class B
transactions 14 -- -- -- -- --
Corporate Trust Class:
Proceeds from sales 35,254 -- 427,493 -- 3,746,678 3,642,667
Shares issued in connection with acquisition
of CT Government Fund -- -- 156,260 -- -- --
Reinvestment of distributions -- -- -- -- -- --
Payments for redemptions (25,519) -- (384,892) -- (3,453,980) (2,896,577)
Increase in net assets from Corporate Trust
Class transactions 9,735 -- 198,861 -- 292,698 746,090
Increase in net assets from capital share
transactions 1,709,539 624,357 294,312 218,513 409,868 746,090
Total increase in net assets 1,709,540 624,359 294,276 218,538 409,899 746,090
Net assets at beginning of period 1,307,347 682,988 455,869 237,331 746,090 --
Net assets at end of period (2) $ 3,016,887 $ 1,307,347 $ 750,145 $ 455,869 $ 1,155,989 $ 746,090
</TABLE>
The accompanying notes are an integral part of the financial statements.
(1) The Treasury Obligations Fund commenced operations on October 4, 1993.
(2) Including undistributed net investment income (000) of $0 and $2 for Prime
Obligations Fund at September 30, 1995 and September 30, 1994,
respectively. The accompanying notes are an integral part of the financial
statements.
<TABLE>
<CAPTION>
INTERMEDIATE FIXED INTERMEDIATE
LIMITED TERM TERM INCOME INCOME GOVERNMENT
INCOME FUND FUND FUND BOND FUND
10/1/94 10/1/93 10/1/94 10/1/93 10/1/94 10/1/93 10/1/94 10/1/93
to to to to to to to to
9/30/95 9/30/94 9/30/95 9/30/94 9/30/95 9/30/94 9/30/95 9/30/94
<S> <C> <C> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Investment income--net $ 6,058 $ 4,118 $ 4,867 $ 2,960 $ 12,473 $ 3,345 $ 4,955 $ 325
Net realized gain (loss) on investments (1,327) 29 542 (863) 3,351 (188) (76) (78)
Net change in unrealized appreciation
(depreciation) of investments 2,575 (2,149) 3,016 (2,753) 9,685 (5,201) 3,665 (344)
Net increase (decrease) in net assets
resulting from operations 7,306 1,998 8,425 (656) 25,509 (2,044) 8,544 (97)
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Investment income--net:
Institutional class (5,548) (2,182) (4,708) (1,900) (11,794) (2,150) (4,819) (217)
Retail class A (544) (1,862) (158) (1,064) (424) (1,197) (127) (109)
Retail class B -- -- -- (127) -- -- --
Net realized gain on investments:
Institutional class (20) -- (23) -- (440) -- -- --
Retail class A (3) -- (1) (685) (22) (574) -- (18)
Retail class B -- -- -- -- (1) -- -- --
TOTAL DISTRIBUTIONS (6,115) (4,044) (4,890) (3,649) (12,808) (3,921) (4,946) (344)
CAPITAL SHARE TRANSACTIONS (1):
Institutional class:
Transfer from Retail class A -- 82,491 -- 59,843 -- 44,936 -- 2,156
Proceeds from sales 35,097 16,209 32,461 25,019 225,170 58,825 83,288 27,456
Shares issued in connection with
acquisition of Managed Income Fund 38,342 -- -- -- -- -- -- --
Reinvestment of distributions 4,773 2,151 3,568 1,829 4,951 1,749 315 81
Payments for redemptions (38,162) (29,445) (19,532) (15,273) (42,680) (12,069) (14,740) (1,614)
Increase (decrease) in net assets from
Institutional class transactions 40,050 71,406 16,497 71,418 187,441 93,441 68,863 28,079
Retail class A:
Proceeds from sales 2,920 28,721 200 4,929 2,212 12,649 1,260 1,156
Shares issued in connection with
acquisition of Managed Income Fund 4,574 -- -- -- -- -- -- --
Reinvestment of distributions 482 1,645 143 1,744 387 1,635 99 117
Payments for redemptions (7,576) (59,260) (1,216) (9,581) (3,165) (12,211) (545) (718)
Transfer to Institutional class -- (82,491) -- (59,843) -- (44,936) -- (2,156)
Increase (decrease) in net assets from
Retail class A transactions 400 (111,385) (873) (62,751) (566) (42,863) 814 (1,601)
Retail class B:
Proceeds from sales 1 1 -- -- 7,180 116 -- --
Reinvestment of distributions -- -- -- -- 118 -- -- --
Payments for redemptions (2) -- -- -- (255) -- -- --
Increase (decrease) in net assets from
Retail class B transactions (1) 1 -- -- 7,043 116 -- --
Increase (decrease) in net assets from
capital share transactions 40,449 (39,978) 15,624 8,667 193,918 50,694 69,677 26,478
Total increase (decrease) in net assets 41,640 (42,024) 19,159 4,362 206,619 44,729 73,275 26,037
NET ASSETS AT BEGINNING OF PERIOD 79,776 121,800 71,653 67,291 98,330 53,601 29,753 3,716
NET ASSETS AT END OF PERIOD (2) $121,416 $ 79,776 $ 90,812 $ 71,653 $304,949 $ 98,330 $103,028 $29,753
(1)Capital share transactions:
Institutional class:
Transfer from retail class A -- 8,255 -- 5,960 -- 4,120 -- 229
Proceeds from sales 3,569 1,636 3,367 2,597 21,255 5,555 9,271 3,034
Shares issued in connection with
acquisition of Managed Income Fund 3,917 -- -- -- -- -- -- --
Reinvestment of distributions 484 218 369 188 467 165 34 9
Payments for redemptions (3,873) (2,975) (2,012) (1,581) (4,012) (1,140) (1,614) (177)
Total Institutional class transactions 4,097 7,134 1,724 7,164 17,710 8,700 7,691 3,095
Retail class A:
Proceeds from sales 297 2,860 20 506 205 1,128 137 123
Shares issued in connection with
acquisition of Managed Income Fund 468 -- -- -- -- -- -- --
Reinvestment of distributions 49 164 15 174 37 147 11 13
Payments for redemptions (773) (5,916) (126) (967) (301) (1,092) (60) (78)
Transfer to Institutional class -- (8,255) -- (5,960) -- (4,120) -- (229)
Total Retail class A transactions 41 (11,147) (91) (6,247) (59) (3,937) 88 (171)
Retail class B:
Proceeds from sales -- -- -- -- 667 11 -- --
Reinvestment of distributions -- -- -- -- 11 -- -- --
Payments for redemptions -- -- -- -- (23) -- -- --
Total Retail class B transactions -- -- -- -- 655 11 -- --
NET INCREASE (DECREASE) FROM SHARE TRANSACTIONS 4,138 (4,013) 1,633 917 18,306 4,774 7,779 2,924
</TABLE>
(table continued)
<TABLE>
<CAPTION>
COLORADO MINNESOTA INSURED
MORTGAGE LIMITED TERM INTERMEDIATE INTERMEDIATE INTERMEDIATE
SECURITIES FUND TAX FREE INCOME FUND TAX FREE FUND TAX FREE FUND TAX FREE FUND
10/1/94 10/1/93 10/1/94 12/1/93 10/1/94 10/1/93 10/1/94 4/4/94(4) 10/1/94 2/28/94(5)
to to to to to to to to to to
9/30/95 9/30/94 9/30/95 9/30/94(3) 9/30/95 9/30/94 9/30/95 9/30/94 9/30/95 9/30/94
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 1,728 $1,780 $549 $ 396 $ 1,389 $ 152 $ 1,967 $ 42 $ 2,565 $ 282
32 (62) 14 (13) 376 (38) 234 1 214 (12)
1,379 (1,966) 138 (115) 1,232 (178) 2,043 (32) 2,478 (252)
3,139 (248) 701 268 2,997 (64) 4,244 11 5,257 18
(1,713) (1,208) (515) (93) (1,344) (78) (1,904) (30) (2,470) (254)
(16) (572) (33) (315) (44) (74) (63) (10) (86) (28)
-- -- -- -- -- -- -- -- -- --
(1) -- -- -- -- -- (2) -- -- --
-- (10) -- -- -- (21) -- -- -- --
-- -- -- -- -- -- -- -- -- --
(1,730) (1,790) (548) (408) (1,388) (173) (1,969) (40) (2,556) (282)
-- 32,357 -- 15,896 -- 2,109 -- -- -- --
1,263 4,386 1,405 1,082 49,729 6,147 47,042 7,465 69,842 21,192
-- -- -- -- -- -- -- -- -- --
1,617 1,182 213 45 64 40 14 10 82 41
(6,723) (8,219) (11,764) (582) (11,501) (2,027) (6,496) (169) (31,135) (709)
(3,843) 29,706 (10,146) 16,441 38,292 6,269 40,560 7,306 38,789 20,524
53 3,906 786 3,189 397 802 1,496 691 878 1,606
-- -- -- -- -- -- -- -- -- --
12 582 32 152 36 83 29 6 71 28
(147) (1,640) (907) (6,128) (622) (481) (74) -- (307) (114)
-- (32,357) -- (15,896) -- (2,109) -- -- -- --
(82) (29,509) (89) (18,683) (189) (1,705) 1,451 697 642 1,520
-- -- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- -- --
(3,925) 197 (10,235) (2,242) 38,103 4,564 42,011 8,003 39,431 22,044
(2,516) (1,841) (10,082) (2,382) 39,712 4,327 44,286 7,974 42,132 21,780
28,674 30,515 16,948 19,330 7,296 2,969 7,974 -- 21,780 --
$ 26,158 $28,674 $ 6,866 $ 16,948 $ 47,008 $ 7,296 $ 52,260 $7,974 $ 63,912 $ 21,780
-- 3,201 -- 1,589 -- 199 -- -- -- --
129 438 141 108 4,792 592 4,676 732 7,280 2,183
-- -- -- -- -- -- -- -- -- --
164 120 21 4 6 4 2 1 8 4
(673) (833) (1,174) (58) (1,103) (195) (631) (16) (3,183) (73)
(380) 2,926 (1,012) 1,643 3,695 600 4,047 717 4,105 2,114
5 379 78 319 37 74 144 68 90 166
-- -- -- -- -- -- -- -- -- --
1 57 3 15 4 8 3 -- 8 3
(14) (159) (90) (612) (59) (45) (7) -- (31) (12)
-- (3,201) -- (1,589) -- (199) -- -- -- --
(8) (2,924) (9) (1,867) (18) (162) 140 68 67 157
-- -- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- -- --
(388) 2 (1,021) (224) 3,677 438 4,187 785 4,172 2,271
</TABLE>
The accompanying notes are an integral part of the financial statements.
(2) Included undistributed (distributions in excess of) net investment income
(000) of $38 and $72 for Limited Term Income Fund, $1 and $0 for
Intermediate Term Income Fund, $134 and $6 for Fixed Income Fund, $9 and $0
Intermediate Government Bond Fund, $16 and $0 for Limited Term Tax Free
Income Fund, $1 and $0 for Intermediate Tax Free Income Fund, $2 and $2 for
Colorado Intermediate Tax Free Income Fund, and $9 and $0 Minnesota Insured
Intermediate Tax Free Fund at September 30, 1995 and September 30, 1994,
respectively.
(3) On April 28, 1994, the Board of Directors approved a change in this Fund's
fiscal year end from November 30 to September 30, effective September 30,
1994.
(4) The Colorado Intermediate Tax Free Fund commenced operations on April 4,
1994.
(5) The Minnesota Insured Intermediate Tax Free Fund commenced operations on
February 28, 1994.
<TABLE>
<CAPTION>
ASSET EQUITY EQUITY
ALLOCATION FUND BALANCED FUND INDEX FUND INCOME FUND
10/1/94 10/1/93 10/1/94 10/1/93 10/1/94 10/1/93 10/1/94 12/1/93
to to to to to to to to
9/30/95 9/30/94 9/30/95 9/30/94 9/30/95 9/30/94 9/30/95 9/30/94(4)
OPERATIONS:
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Investment income (loss)--net $ 1,504 $ 1,373 $ 6,024 $ 4,192 $ 4,387 $ 3,793 $ 1,701 $ 959
Net realized gain (loss) on investments 1,590 1,042 7,484 2,435 1,499 1,237 435 (442)
Net realized gain on futures contracts -- -- -- -- 1,525 -- -- --
Net realized gain (loss) on forward foreign currency
contracts and foreign currency transactions -- -- -- -- -- -- -- --
Net change in unrealized appreciation
(depreciation) of investments 4,397 (1,588) 18,934 (3,010) 40,664 56 5,876 334
Net change in unrealized appreciation on
futures contract -- -- -- -- 15 -- -- --
Net change in unrealized depreciation on forward
foreign currency contracts, foreign currency and
translation of other assets and liabilities in
foreign currency -- -- -- -- -- -- -- --
Net increase (decrease) in net assets resulting
from operations 7,491 827 32,442 3,617 48,090 5,086 8,012 851
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Investment income--net:
Institutional class (1,451) (991) (5,355) (2,793) (4,282) (2,885) (1,562) (61)
Retail class A (24) (384) (458) (1,366) (28) (912) (70) (880)
Retail class B (6) -- (32) -- (5) -- (11) --
Net realized gain on investments:
Institutional class (1,084) -- (1,857) -- (1,427) -- -- --
Retail class A (15) (713) (188) (1,884) (7) (188) -- --
Retail class B (1) -- (7) -- (1) -- -- --
Return of capital:
Institutional class -- -- -- -- -- -- -- --
Total distributions (2,581) (2,088) (7,897) (6,043) (5,750) (3,985) (1,643) (941)
CAPITAL SHARE TRANSACTIONS (1):
Institutional class:
Transfer from Retail class A -- 51,261 -- 109,870 -- 143,478 -- 6,302
Proceeds from sales 8,308 6,840 76,127 28,604 47,941 33,718 35,073 12,340
Reinvestment of distributions 2,516 987 7,075 2,773 5,459 2,867 196 20
Payments for redemptions (19,615) (13,790) (38,755) (18,873) (40,076) (23,678) (6,696) (800)
Increase (decrease) in net assets from
Institutional class transactions (8,791) 45,298 44,447 122,374 13,324 156,385 28,573 17,862
Retail class A:
Proceeds from sales 298 3,688 1,737 24,928 1,205 17,529 623 3,926
Reinvestment of distributions 37 1,097 640 3,244 33 1,100 67 737
Payments for redemptions (145) (6,020) (2,783) (10,460) (181) (8,148) (789) (25,578)
Transfer to Institutional class -- (51,261) -- (109,870) -- (143,478) -- (6,302)
Increase (decrease) in net assets from
Retail class A transactions 190 (52,496) (406) (92,158) 1,057 (132,997) (99) (27,217)
Retail class B:
Proceeds from sales 543 11 2,775 274 1,092 29 1,241 1
Reinvestment of distributions 7 -- 37 -- 5 -- 10 --
Payments for redemptions (30) -- (134) -- (24) -- (82) --
Increase in net assets from Retail class B
transactions 520 11 2,678 274 1,073 29 1,169 1
Increase (decrease) in net assets from capital
share transactions (8,081) (7,187) 46,719 30,490 15,454 23,417 29,643 (9,354)
Total increase (decrease) in net assets (3,171) (8,448) 71,264 28,064 57,794 24,518 36,012 (9,444)
NET ASSETS AT BEGINNING OF PERIOD 47,945 56,393 139,289 111,225 164,475 139,957 19,342 28,786
NET ASSETS AT END OF PERIOD (2) $ 44,774 $ 47,945 $210,553 $ 139,289 $222,269 $ 164,475 $ 55,354 $ 19,342
(1)Capital share transactions:
Institutional class:
Transfer from Retail class A -- 5,136 -- 10,707 -- 14,112 -- 600
Proceeds from sales 765 658 6,800 2,697 4,043 3,201 3,492 1,247
Reinvestment of distributions 241 95 648 261 484 271 19 2
Payments for redemptions (1,868) (1,341) (3,493) (1,774) (3,454) (2,248) (643) (81)
Total Institutional class transactions (862) 4,548 3,955 11,891 1,073 15,336 2,868 1,768
Retail class A:
Proceeds from sales 28 345 155 2,312 102 1,626 58 397
Reinvestment of distributions 3 103 59 303 3 102 7 75
Payments for redemptions (14) (564) (255) (967) (16) (753) (75) (2,600)
Transfer to Institutional class -- (5,136) -- (10,707) -- (14,112) -- (600)
Total Retail class A transactions 17 (5,252) (41) (9,059) 89 (13,137) (10) (2,728)
Retail class B:
Proceeds from sales 50 1 241 26 89 3 117 --
Reinvestment of distributions 1 -- 3 -- -- -- 1 --
Payments for redemptions (3) -- (12) -- (2) -- (8) --
Total Retail class B transactions 48 1 232 26 87 3 110 --
NET INCREASE (DECREASE) IN CAPITAL SHARES (797) (703) 4,146 2,858 1,249 2,202 2,968 (960)
</TABLE>
(table continued)
<TABLE>
<CAPTION>
LIMITED
VOLATILITY
STOCK DIVERSIFIED SPECIAL REGIONAL EMERGING
FUND GROWTH FUND STOCK FUND EQUITY FUND EQUITY FUND GROWTH FUND
11/15/94(3) 10/1/94 12/1/93 10/1/94 10/1/93 10/1/94 10/1/93 10/1/94 10/1/93 10/1/94 4/4/94(5)
to to to to to to to to to to to
9/30/95 9/30/95 9/30/94(4) 9/30/95 9/30/94 9/30/95 9/30/94 9/30/95 9/30/94 9/30/95 9/30/94
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 358 $ 1,384 $ 304 $ 5,063 $ 2,724 $ 4,029 $ 2,024 $ 1,068 $ 611 $ 42 $ 4
(131) 2,291 (3,037) 17,763 7,831 15,970 8,668 16,157 2,221 1,122 66
-- -- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- -- --
2,922 21,333 1,902 35,581 319 4,572 7,538 37,100 2,652 5,699 239
-- -- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- -- -- --
3,149 25,008 (831) 58,407 10,874 24,571 18,230 54,325 5,484 6,863 309
(350) (1,245) (95) (4,669) (2,082) (3,740) (1,518) (705) (486) (24) (3)
-- (29) (242) (182) (608) (182) (490) (45) (112) -- --
-- (2) -- (29) (2) (32) (1) (1) -- -- --
-- -- -- (6,156) -- (8,609) -- (2,571) -- (158) --
-- -- -- (307) (3,673) (473) (5,674) (216) (888) (1) --
-- -- -- (26) -- (52) -- (10) -- -- --
-- -- -- -- -- -- -- -- -- -- --
(350) (1,276) (337) (11,369) (6,365) (13,088) (7,683) (3,548) (1,486) (183) (3)
-- -- 2,393 -- 110,876 -- 88,018 -- 61,030 -- --
15,144 91,647 32,761 155,804 52,481 72,724 29,156 60,768 27,827 30,230 6,695
247 411 68 7,982 1,908 10,320 1,418 3,115 471 54 1
(1,065) (14,227) (803) (50,899) (24,357) (20,701) (7,305) (17,586) (4,225) (2,013) (148)
14,326 77,831 34,419 112,887 140,908 62,343 111,287 46,297 85,103 28,271 6,548
-- 877 2,689 3,938 20,003 5,207 18,076 4,213 23,298 275 86
-- 29 229 463 4,166 649 5,968 261 997 1 --
-- (622) (31,086) (1,552) (29,532) (2,109) (3,615) (1,456) (6,404) (31) --
-- -- (2,393) -- (110,876) -- (88,018) -- (61,030) -- --
-- 284 (30,561) 2,849 (116,239) 3,747 (67,589) 3,018 (43,139) 245 86
-- 765 13 6,337 350 4,195 364 6,573 186 249 18
-- 2 -- 54 2 79 1 9 -- -- --
-- (18) -- (195) -- (114) -- (119) -- (33) --
-- 749 13 6,196 352 4,160 365 6,463 186 216 18
14,326 78,864 3,871 121,932 25,021 70,250 44,063 55,778 42,150 28,732 6,652
17,125 102,596 2,703 168,970 29,530 81,733 54,610 106,555 46,148 35,412 6,958
-- 33,787 31,084 163,716 134,186 136,509 81,899 104,575 58,427 6,958 --
$ 17,125 $136,383 $ 33,787 $332,686 $ 163,716 $218,242 $136,509 $211,130 $104,575 $ 42,370 $ 6,958
-- -- 223 -- 7,556 -- 6,040 -- 5,673 -- --
1,511 9,131 3,361 9,002 3,185 4,412 1,778 4,305 2,308 2,628 664
22 41 7 487 116 658 85 261 38 5 --
(95) (1,398) (89) (2,902) (1,469) (1,236) (457) (1,227) (351) (170) (15)
1,438 7,774 3,502 6,587 9,388 3,834 7,446 3,339 7,668 2,463 649
-- 82 295 218 1,225 305 1,122 289 1,910 22 9
-- 3 25 28 260 41 383 22 84 -- --
-- (63) (3,198) (88) (1,808) (121) (224) (106) (539) (2) --
-- -- (223) -- (7,556) -- (6,040) -- (5,673) -- --
-- 22 (3,101) 158 (7,879) 225 (4,759) 205 (4,218) 20 9
-- 70 1 348 21 252 21 441 15 21 2
-- -- -- 3 -- 5 -- 1 -- -- --
-- (1) -- (10) -- (6) -- (8) -- (3) --
-- 69 1 341 21 251 21 434 15 18 2
1,438 7,865 402 7,086 1,530 4,310 2,708 3,978 3,465 2,501 660
(table continued)
REAL
ESTATE
TECHNOLOGY INTERNATIONAL SECURITIES
FUND FUND FUND
10/1/94 4/4/94(5) 10/1/94 4/4/94(5) 6/30/95(6)
to to to to to
9/30/95 9/30/94 9/30/95 9/30/94 9/30/95
$ (67) $ (3) $ 82 $ (29) $ 69
3,397 143 (5,987) (177) --
-- -- -- -- --
-- -- 1,921 (443) --
6,007 731 8,360 1,309 170
-- -- -- -- --
-- -- (202) (40) --
9,337 871 4,174 620 239
-- -- -- -- (58)
-- -- -- -- --
-- -- -- -- --
(174) -- -- -- --
(2) -- -- -- --
-- -- -- -- --
-- -- -- -- (20)
(176) -- -- -- (78)
-- -- -- -- --
15,964 5,773 50,343 47,575 5,595
26 -- -- -- --
(1,921) (145) (8,022) (225) --
14,069 5,628 42,321 47,350 5,595
1,267 53 463 459 1
2 -- -- -- --
(72) -- (87) (2) --
-- -- -- -- --
1,197 53 376 457 1
1,825 2 294 22 1
-- -- -- -- --
(39) -- (32) -- --
1,786 2 262 22 1
17,052 5,683 42,959 47,829 5,597
26,213 6,554 47,133 48,449 5,758
6,554 -- 48,449 -- --
$ 32,767 $ 6,554 $ 95,582 $ 48,449 $ 5,758
-- -- -- -- --
1,158 595 5,347 4,717 555
2 -- -- -- --
(136) (15) (876) (22) --
1,024 580 4,471 4,695 555
79 6 49 45 --
-- -- -- -- --
(4) -- (9) -- --
-- -- -- -- --
75 6 40 45 --
115 -- 31 2 --
-- -- -- -- --
(2) -- (3) -- --
113 -- 28 2 --
1,212 586 4,539 4,742 555
</TABLE>
The accompanying notes are an integral part of the financial statements.
(2) Included undistributed (distributions in excess of) net investment income
(000) of $33 and $10 for Asset Allocation, $203 and $24 for Balanced, $110
and $38 for Equity Index, $104 and $30 for Equity Income, $8 for Limited
Volatility, $146 and $20 for Diversified Growth, $235 and $52 for Stock,
$75 and $0 for Special Equity, $317 and $0 for Regional Equity, $19 and $1
for Emerging Growth, $11 for the Real Estate Securities Fund, and
accumulated net investment (loss) of ($0) and ($3) for Technology Fund, and
undistributed net investment income $1,609 and net operating loss ($415)
for International at September 30, 1995 and September 30, 1994,
respectively.
(3) The Limited Volatility Stock Fund commenced operations on November 15,
1994.
(4) On April 28, 1994, the Board of Directors approved a change in this Fund's
fiscal year end from November 30 to September 30, effective September 30,
1994.
(5) The Emerging Growth, International, and Technology Fund commenced
operations on April 4, 1994.
(6) The Real Estate Securities Fund commenced operations on June 30, 1995.
FINANCIAL HIGHLIGHTS
For the periods ended September 30,
For a share outstanding throughout the period
<TABLE>
<CAPTION>
RATIO OF
RATIO OF NET EXPENSES TO
NET ASSET DIVIDENDS NET ASSET RATIO OF INVESTMENT AVERAGE
VALUE NET FROM NET VALUE NET ASSETS EXPENSES TO INCOME TO NET ASSETS
BEGINNING INVESTMENT INVESTMENT END OF END OF AVERAGE AVERAGE (EXCLUDING
OF PERIOD INCOME INCOME PERIOD TOTAL RETURN PERIOD (000) NET ASSETS NET ASSETS WAIVERS)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
PRIME OBLIGATIONS
INSTITUTIONAL CLASS
1995 $1.00 $0.055 $(0.055) $1.00 5.64% $2,911,055 0.45% 5.53% 0.60%
1994 1.00 0.035 (0.035) 1.00 3.56 1,307,347 0.45 3.58 0.60
1993 1.00 0.030 (0.030) 1.00 3.02 682,988 0.45 2.97 0.62
1992 1.00 0.039 (0.039) 1.00 4.02 203,765 0.45 3.90 0.59
1991 1.00 0.064 (0.064) 1.00 6.60 193,650 0.45 6.43 0.57
1990(1) 1.00 0.046 (0.046) 1.00 4.73+ 239,231 0.45 7.90 0.55
RETAIL CLASS A
1995(3)* $1.00 $0.038 $(0.038) $1.00 3.84%+ $ 96,083 0.70% 5.43% 0.82%
RETAIL CLASS B
1995(4)* $1.00 $0.032 $(0.032) $1.00 3.28%+ $ 14 1.45% 4.70% 1.57%
CORPORATE TRUST CLASS
1995(5)* $1.00 $0.038 $(0.038) $1.00 3.86%+ $ 9,735 0.60% 5.51% 0.72%
GOVERNMENT OBLIGATIONS
INSTITUTIONAL CLASS
1995 $1.00 $0.054 $(0.054) $1.00 5.55% $ 551,286 0.45% 5.44% 0.60%
1994 1.00 0.034 (0.034) 1.00 3.48 455,869 0.45 3.61 0.61
1993 1.00 0.028 (0.028) 1.00 2.87 237,331 0.45 2.83 0.65
1992 1.00 0.038 (0.038) 1.00 3.85 93,770 0.45 3.71 0.64
1991 1.00 0.060 (0.060) 1.00 6.22 72,824 0.45 5.90 0.68
1990(1) 1.00 0.045 (0.045) 1.00 4.56+ 29,704 0.45 7.60 0.98
CORPORATE TRUST CLASS
1995(3)* $1.00 $0.038 $(0.038) $1.00 3.85%+ $ 198,859 0.60% 5.45% 0.70%
TREASURY OBLIGATIONS
INSTITUTIONAL CLASS
1995(5)* $1.00 $0.038 $(0.038) $1.00 3.83%+ $ 117,171 0.45% 5.50% 0.55%
CORPORATE TRUST CLASS
1995 $1.00 $0.051 $(0.051) $1.00 5.22% $1,038,818 0.60% 5.13% 0.70%
1994(2) 1.00 0.031 (0.031) 1.00 3.12+ 746,090 0.58 3.19 0.68
</TABLE>
The accompanying notes are an integral part of the financial statements.
+ Returns are for the period indicated and have not been annualized
* All ratios for the periods have been annualized.
(1) Commenced operations on March 1, 1990. All ratios for the period have been
annualized.
(2) Commenced operations on October 4, 1993. All ratios for the period have
been annualized.
(3) Commenced operations on January 21, 1995. All ratios for the period have
been annualized.
(4) Commenced operations on January 23, 1995. All ratios for the period have
been annualized.
(5) Commenced operations on January 24, 1995. All ratios for the period have
been annualized.
For the periods ended September 30,
For a share outstanding throughout the period
<TABLE>
<CAPTION>
REALIZED
AND
NET ASSET UNREALIZED DIVIDENDS NET ASSET
VALUE NET GAINS OR FROM NET DISTRIBUTIONS VALUE NET ASSETS
BEGINNING INVESTMENT (LOSSES) ON INVESTMENT FROM END OF END OF
OF PERIOD INCOME INVESTMENTS INCOME CAPITAL GAINS PERIOD TOTAL RETURN PERIOD (000)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
LIMITED TERM INCOME
INSTITUTIONAL CLASS
1995 $ 9.85 $0.56 $ 0.07 $(0.56) $ -- $ 9.92 6.57% $111,439
1994(1) 10.02 0.29 (0.17) (0.29) -- 9.85 1.24%+ 70,266
RETAIL CLASS A
1995 $ 9.85 $0.56 $ 0.07 $(0.56) $ -- $ 9.92 6.57% $ 9,977
1994 10.06 0.44 (0.22) (0.43) -- 9.85 2.21% 9,509
1993(2) 10.00 0.29 0.07 (0.30) -- 10.06 3.61%+ 121,800
RETAIL CLASS B
1995(3) $ 9.84 $0.13 $(0.08) $(0.14) $ -- $ -- 0.52%+ $ --
1994(4) 9.86 0.04 0.01 (0.07) -- 9.84 0.51%+ 1
INTERMEDIATE TERM INCOME
INSTITUTIONAL CLASS
1995 $ 9.55 $0.58 $ 0.39 $(0.58) $ -- $ 9.94 10.51% $ 88,375
1994(1) 10.01 0.31 (0.46) (0.31) -- 9.55 (1.48%)+ 68,445
RETAIL CLASS A
1995 $ 9.55 $0.59 $ 0.38 $(0.58) $ -- $ 9.94 10.51% $ 2,437
1994 10.22 0.46 (0.56) (0.46) (0.11) 9.55 (1.05%) 3,208
1993(2) 10.00 0.41 0.29 (0.41) (0.07) 10.22 7.21%+ 67,291
FIXED INCOME
INSTITUTIONAL CLASS
1995 $10.37 $0.66 $ 0.62 $(0.65) $(0.03) $10.97 12.86% $289,816
1994(1) 11.11 0.38 (0.74) (0.38) -- 10.37 (3.23%)+ 90,187
RETAIL CLASS A
1995 $10.37 $0.66 $ 0.61 $(0.63) $(0.03) $10.98 12.78% $ 7,853
1994 11.38 0.57 (0.89) (0.57) (0.12) 10.37 (2.92%) 8,028
1993 11.13 0.62 0.36 (0.61) (0.12) 11.38 9.20% 53,601
1992 10.59 0.66 0.60 (0.66) (0.06) 11.13 12.34% 5,645
1991(5) 10.01 0.65 0.58 (0.65) -- 10.59 12.48%+ 6,045
1990(6) 10.44 0.74 (0.26) (0.74) (0.17) 10.01 5.14% 2,209
1989(6) 10.13 0.74 0.31 (0.74) -- 10.44 10.93% 555
1988(6)(7) 10.03 0.62 0.13 (0.65) -- 10.13 8.07%+ 240
RETAIL CLASS B
1995 $10.35 $0.58 $ 0.60 $(0.56) $(0.03) $10.94 11.75% $ 7,280
1994(4) 10.54 0.08 (0.17) (0.10) -- 10.35 (0.88%)+ 115
INTERMEDIATE GOVERNMENT BOND
INSTITUTIONAL CLASS
1995 $ 8.98 $0.54 $ 0.31 $(0.54) $ -- $ 9.29 9.82% $100,168
1994(1) 9.41 0.27 (0.43) (0.27) -- 8.98 (1.66%)+ 27,776
RETAIL CLASS A
1995 $ 8.98 $0.54 $ 0.31 $(0.54) $ -- $ 9.29 9.82% $ 2,860
1994 9.52 0.41 (0.51) (0.39) (0.05) 8.98 (1.13%) 1,977
1993 10.18 0.44 0.02 (0.44) (0.68) 9.52 4.99% 3,716
1992 10.25 0.60 0.28 (0.60) (0.35) 10.18 8.88% 589
1991(5) 10.01 0.65 0.24 (0.65) -- 10.25 9.13%+ 1,756
1990(6) 10.05 0.75 (0.04) (0.75) -- 10.01 7.41% 1,573
1989(6) 9.99 0.74 0.06 (0.74) -- 10.05 8.35% 1,501
1988(6)(7) 10.03 0.58 (0.01) (0.61) -- 9.99 6.18%+ 375
MORTGAGE SECURITIES
INSTITUTIONAL CLASS
1995 $ 9.71 $0.61 $ 0.49 $(0.61) $ -- $10.20 11.84% $ 25,970
1994(1) 10.30 0.38 (0.59) (0.38) -- 9.71 (2.15%)+ 28,418
RETAIL CLASS A
1995 $ 9.71 $0.61 $ 0.49 $(0.61) $ -- $10.20 11.84% $ 188
1994 10.34 0.56 (0.63) (0.56) -- 9.71 (0.79%) 256
1993(2) 10.00 0.42 0.34 (0.42) -- 10.34 7.76%+ 30,515
LIMITED TERM TAX FREE INCOME
INSTITUTIONAL CLASS
1995 $ 9.95 $0.39 $ 0.11 $(0.39) $ -- $10.06 5.16% $ 6,346
1994(8) 9.98 0.06 (0.03) (0.06) -- 9.95 0.27%+ 16,349
RETAIL CLASS A
1995 $ 9.95 $0.39 $ 0.11 $(0.39) $ -- $10.06 5.16% $ 520
1994(9) 10.03 0.22 (0.07) (0.23) -- 9.95 1.50%+ 599
1993(10)(11) 10.00 0.18 0.02 (0.17) -- 10.03 2.02%+ 19,330
INTERMEDIATE TAX FREE
INSTITUTIONAL CLASS
1995 $10.28 $0.49 $ 0.43 $(0.48) $ -- $10.72 9.15% $ 46,025
1994(1) 10.89 0.29 (0.61) (0.29) -- 10.28 (2.91%)+ 6,168
RETAIL CLASS A
1995 $10.28 $0.49 $ 0.43 $(0.48) $ -- $10.72 9.15% $ 983
1994 10.92 0.44 (0.57) (0.44) (0.07) 10.28 (1.25%) 1,128
1993 10.56 0.47 0.42 (0.47) (0.06) 10.92 8.66% 2,969
1992 10.34 0.53 0.22 (0.53) -- 10.56 7.23% 725
1991(5) 10.04 0.50 0.31 (0.50) (0.01) 10.34 8.15%+ 637
1990(6) 10.08 0.56 (0.04) (0.56) -- 10.04 5.31% 537
1989(6) 10.19 0.56 (0.11) (0.56) -- 10.08 4.57% 491
1988(6)(7) 10.03 0.47 0.16 (0.47) -- 10.19 6.73%+ 425
COLORADO INTERMEDIATE TAX FREE
INSTITUTIONAL CLASS
1995 $10.16 $0.48 $ 0.36 $(0.49) $ -- $10.51 8.47% $ 50,071
1994(13) 10.00 0.22 0.16 (0.22) -- 10.16 3.76%+ 7,281
RETAIL CLASS A
1995 $10.15 $0.49 $ 0.36 $(0.49) $ -- $10.51 8.57% $ 2,189
1994(13) 10.00 0.21 0.16 (0.22) -- 10.15 3.66%+ 693
MINNESOTA INSURED INTERMEDIATE TAX FREE
INSTITUTIONAL CLASS
1995 $ 9.59 $0.45 $ 0.33 $(0.45) $ -- $ 9.92 8.34% $ 61,693
1994(12) 10.00 0.25 (0.41) (0.25) -- 9.59 (1.58%)+ 20,272
RETAIL CLASS A
1995 $ 9.58 $0.46 $ 0.33 $(0.45) $ -- $ 9.92 8.46% $ 2,219
1994(12) 10.00 0.25 (0.42) (0.25) -- 9.58 (1.68%)+ 1,508
ASSET ALLOCATION
INSTITUTIONAL CLASS
1995 $10.38 $0.38 $ 1.58 $(0.37) $(0.25) $11.72 19.75% $ 43,210
1994(1) 10.68 0.20 (0.30) (0.20) -- 10.38 (0.90%)+ 47,227
RETAIL CLASS A
1995 $10.39 $0.36 $ 1.58 $(0.35) $(0.25) $11.73 19.51% $ 993
1994 10.60 0.27 (0.08) (0.26) (0.14) 10.39 1.81% 707
1993(2) 10.00 0.19 0.60 (0.19) -- 10.60 8.01%+ 56,393
RETAIL CLASS B
1995 $10.37 $0.27 $ 1.57 $(0.28) $(0.25) $11.68 18.51% $ 571
1994(4) 10.40 0.05 (0.03) (0.05) -- 10.37 0.19% 11
BALANCED
INSTITUTIONAL CLASS
1995 $10.54 $0.40 $ 1.73 $(0.39) $(0.15) $12.13 20.89% $192,145
1994(1) 10.86 0.25 (0.32) (0.25) -- 10.54 (0.64%)+ 125,285
RETAIL CLASS A
1995 $10.54 $0.38 $ 1.72 $(0.37) $(0.15) $12.12 20.57% $ 15,288
1994 10.73 0.34 (0.02) (0.34) (0.17) 10.54 3.02% 13,734
1993(2) 10.00 0.28 0.75 (0.28) (0.02) 10.73 10.39%+ 111,225
RETAIL CLASS B
1995 $10.53 $0.29 $ 1.71 $(0.29) $(0.15) $12.09 19.58% $ 3,120
1994(4) 10.66 0.06 (0.12) (0.07) -- 10.53 (0.55%)+ 270
(table continued)
RATIO OF RATIO OF
NET EXPENSES TO
RATIO OF INVESTMENT AVERAGE
EXPENSES TO INCOME TO NET ASSETS
AVERAGE AVERAGE (EXCLUDING PORTFOLIO
NET ASSETS NET ASSETS WAIVERS) TURNOVER RATE
0.60% 5.67% 0.97% 120%
0.60 4.40 1.03 48
0.60% 5.60% 1.22% 120%
0.60 4.17 1.23 48
0.60 3.61 1.27 104
1.60% 5.22% 1.97% 120%
1.60 3.50 2.03 48
0.70% 5.94% 0.94% 69%
0.58 4.81 1.07 177
0.70% 5.97% 1.19% 69%
0.69 2.48 1.24 177
0.70 4.90 1.29 163
0.70% 6.28% 0.94% 106%
0.61 5.53 0.92 142
0.86% 6.14% 1.19% 106%
0.68 3.83 1.06 142
0.70 5.65 1.14 91
0.99 6.12 2.68 180
0.99 6.85 4.11 176
1.07 7.49 5.46 144
1.22 7.26 22.44 157
0.96 7.18 20.70 93
1.70% 5.12% 1.94% 106%
1.70 4.89 1.92 142
0.70% 6.13% 0.97% 17%
0.36 5.32 1.45 74
0.70% 6.10% 1.22% 17%
0.53 4.49 2.14 74
0.71 4.00 4.73 182
0.99 6.03 14.14 101
0.99 6.99 6.76 100
1.08 7.57 5.55 40
1.19 7.49 9.65 72
0.95 6.78 17.20 0
0.70% 6.13% 1.05% 31%
0.56 5.79 1.07 35
0.70% 6.11% 1.30% 31%
0.70 5.12 1.30 35
0.70 5.24 1.42 29
0.60% 3.83% 1.39% 55%
0.60 3.26 1.28 57
0.60% 3.97% 1.64% 55%
0.90 2.47 1.53 57
0.81 2.30 1.76 22
0.67% 4.73% 1.05% 68%
0.45 4.48 2.20 52
0.67% 4.71% 1.30% 68%
0.59 4.13 2.78 52
0.71 4.31 5.09 27
0.99 4.83 16.09 23
0.99 5.35 15.48 15
1.08 5.58 13.85 4
1.09 5.57 19.55 4
0.84 5.87 13.60 0
0.70% 4.84% 1.02% 19%
0.69 4.51 4.71 4
0.70% 4.83% 1.27% 19%
0.69 4.51 4.96 4
0.70% 4.76% 1.00% 38%
0.67 4.57 1.59 22
0.70% 4.74% 1.25% 38%
0.67 4.57 1.84 22
0.79% 3.53% 1.01% 87%
0.75 2.91 1.12 32
0.99% 3.29% 1.26% 87%
0.75 2.01 1.29 32
0.75 2.40 1.34 31
1.79% 2.35% 2.01% 87%
1.75 1.94 2.12 32
0.79% 3.61% 0.94% 77%
0.75 3.51 1.05 98
0.99% 3.41% 1.19% 77%
0.77 2.63 1.24 98
0.75 3.31 1.29 77
1.79% 2.60% 1.94% 77%
1.75 2.80 2.05 98
</TABLE>
The accompanying notes are an integral part of the financial statements.
+ Returns, excluding sales charges, are for the period indicated and have not
been annualized.
(1) Institutional Class shares have been offered since February 4, 1994. All
ratios for the period have been annualized.
(2) Commenced operations on December 14, 1992. All ratios for the period have
been annualized.
(3) Closed operations on January 31, 1995. All ratios for the period have been
annualized.
(4) Retail Class B shares have been offered since August 15, 1994. All ratios
for the period have been annualized.
(5) On September 3, 1991, the Board of Directors of FAIF approved a change in
the FAIF's fiscal year end from October 31 to September 30, effective
September 30, 1991. All ratios for the period have been annualized.
(6) For the period ended October 31.
(7) Commenced operations on December 22, 1987. All ratios for the period have
been annualized.
(8) Institutional Class shares have been offered since August 2, 1994. All
ratios for the period have been annualized.
(9) On April 28, 1994 the Board of Directors approved a change in this Fund's
fiscal year end from November 30 to September 30, effective September 30,
1994. All ratios for the period have been annualized.
(10) For the period ended November 30.
(11) Commenced operations on February 19, 1993. All ratios for the period have
been annualized.
(12) Commenced operations on February 28, 1994. All ratios for the period have
been annualized.
(13) Commenced operations on April 4, 1994. All ratios for the period have been
annualized.
For the periods ended September 30,
For a share outstanding throughout the period
<TABLE>
<CAPTION>
REALIZED
AND
NET ASSET UNREALIZED DIVIDENDS NET ASSET
VALUE NET GAINS OR FROM NET DISTRIBUTIONS VALUE NET ASSETS
BEGINNING INVESTMENT (LOSSES) ON INVESTMENT FROM END OF END OF
OF PERIOD INCOME INVESTMENTS INCOME CAPITAL GAINS PERIOD TOTAL RETURN PERIOD (000)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
EQUITY INDEX
INSTITUTIONAL CLASS
1995 $10.67 $0.28 $ 2.75 $(0.27) $(0.09) $13.34 29.17% $218,932
1994(1) 10.85 0.20 (0.18) (0.20) -- 10.67 0.18%+ 163,688
RETAIL CLASS A
1995 $10.68 $0.25 $ 2.76 $(0.25) $(0.09) $13.35 28.90% $ 2,140
1994 10.60 0.25 0.09 (0.25) (0.01) 10.68 3.25% 758
1993(2) 10.00 0.20 0.60 (0.20) -- 10.60 8.02%+ 139,957
RETAIL CLASS B
1995 $10.66 $0.23 $ 2.68 $(0.18) $(0.09) $13.30 27.87% $ 1,197
1994(3) 10.68 0.01 0.04 (0.07) -- 10.66 0.48%+ 29
EQUITY INCOME
INSTITUTIONAL CLASS
1995 $ 9.89 $0.41 $ 1.35 $(0.41) $ -- $11.24 18.24% $ 52,126
1994(4) 9.90 0.07 (0.03) (0.05) -- 9.89 0.45%+ 17,489
RETAIL CLASS A
1995 $ 9.89 $0.41 $ 1.33 $(0.39) $ -- $11.24 18.06% $ 1,995
1994(5) 9.87 0.41 -- (0.39) -- 9.89 4.22%+ 1,852
1993(6)(7) 10.00 0.57 (0.14) (0.56) -- 9.87 4.44%+ 28,786
RETAIL CLASS B
1995 $ 9.88 $0.33 $ 1.32 $(0.33) $ -- $11.20 17.10% $ 1,233
1994(3) 9.87 0.04 0.02 (0.05) -- 9.88 0.57%+ 1
LIMITED VOLATILITY STOCK
INSTITUTIONAL CLASS
1995(8) $10.00 $0.26 $ 1.90 $(0.25) $ -- $11.91 21.93% $ 17,125
DIVERSIFIED GROWTH
INSTITUTIONAL CLASS
1995 $ 9.10 $0.17 $ 2.67 $(0.16) $ -- $11.78 31.57% $132,854
1994(4) 8.92 0.03 0.18 (0.03) -- 9.10 2.36%+ 31,875
RETAIL CLASS A
1995 $ 9.09 $0.15 $ 2.66 $(0.15) $ -- $11.75 31.21% $ 2,710
1994(5) 9.39 0.10 (0.29) (0.11) -- 9.09 (2.07%)+ 1,900
1993(6)(7) 10.00 0.11 (0.63) (0.09) -- 9.39 (5.18%)+ 31,084
RETAIL CLASS B
1995 $ 9.09 $0.09 $ 2.65 $(0.10) $ -- $11.73 30.29% $ 819
1994(3) 8.87 0.01 0.23 (0.02) -- 9.09 2.75%+ 12
STOCK
INSTITUTIONAL CLASS
1995 $16.50 $0.36 $ 3.64 $(0.35) $(0.59) $19.56 25.50% $312,559
1994(1) 16.47 0.25 0.03 (0.25) -- 16.50 1.70%+ 154,949
RETAIL CLASS A
1995 $16.51 $0.33 $ 3.64 $(0.32) $(0.59) $19.57 25.26% $ 13,076
1994 16.00 0.31 1.00 (0.30) (0.50) 16.51 8.35% 8,421
1993 14.04 0.22 1.99 (0.23) (0.02) 16.00 15.82% 134,186
1992 13.62 0.24 0.81 (0.29) (0.34) 14.04 7.88% 3,644
1991(9) 10.64 0.28 2.95 (0.22) (0.03) 13.62 30.49%+ 2,386
1990(10) 12.09 0.25 (1.17) (0.25) (0.28) 10.64 (8.22%) 1,161
1989(10) 10.35 0.25 1.70 (0.20) (0.01) 12.09 20.33% 323
1988(10)(11) 10.03 0.27 0.35 (0.30) -- 10.35 6.40%+ 206
RETAIL CLASS B
1995 $16.49 $0.26 $ 3.55 $(0.22) $(0.59) $19.49 24.20% $ 7,051
1994(3) 16.65 0.03 (0.10) (0.09) -- 16.49 (0.43%)+ 346
SPECIAL EQUITY
INSTITUTIONAL CLASS
1995 $17.30 $0.38 $ 1.61 $(0.38) $(1.02) $17.89 12.84% $201,786
1994(1) 16.34 0.22 0.96 (0.22) -- 17.30 7.31%+ 128,806
RETAIL CLASS A
1995 $17.30 $0.35 $ 1.60 $(0.34) $(1.02) $17.89 12.63% $ 11,609
1994 15.81 0.28 2.52 (0.28) (1.03) 17.30 18.70% 7,333
1993 13.61 0.23 2.32 (0.25) (0.10) 15.81 18.91% 81,899
1992 12.98 0.21 1.61 (0.27) (0.92) 13.61 15.17% 3,586
1991(9) 10.33 0.30 2.61 (0.26) -- 12.98 28.38%+ 3,423
1990(10) 12.96 0.47 (2.03) (0.46) (0.61) 10.33 (13.24%) 2,761
1989(10) 11.55 0.47 1.39 (0.41) (0.04) 12.96 17.41% 2,000
1988(10)(11) 10.03 0.34 1.57 (0.39) -- 11.55 19.56%+ 578
RETAIL CLASS B
1995 $17.29 $0.29 $ 1.51 $(0.24) $(1.02) $17.83 11.64% $ 4,847
1994(3) 16.51 0.01 0.85 (0.08) -- 17.29 5.22%+ 370
(table continued)
RATIO OF RATIO OF
NET EXPENSES TO
RATIO OF INVESTMENT AVERAGE
EXPENSES TO INCOME TO NET ASSETS
AVERAGE AVERAGE (EXCLUDING PORTFOLIO
NET ASSETS NET ASSETS WAIVERS) TURNOVER RATE
0.35% 2.41% 0.95% 9%
0.35 2.59 1.03 11
0.57% 2.16% 1.20% 9%
0.35 2.23 1.23 11
0.35 2.52 1.30 1
1.35% 1.34% 1.95% 9%
1.35 1.68 2.03 11
0.75% 4.11% 1.06% 23%
0.75 5.61 1.14 108
0.92% 3.91% 1.31% 23%
0.88 4.88 1.39 108
0.75 6.09 1.36 68
1.75% 3.05% 2.06% 23%
1.75 4.39 2.14 108
0.75% 2.75% 1.21% 28%
0.75% 1.69% 1.01% 28%
0.75 2.37 1.08 101
0.92% 1.52% 1.26% 28%
0.90 1.15 1.33 101
0.78 1.26 1.25 5
1.75% 0.58% 2.01% 28%
1.75 1.20 2.08 101
0.79% 2.10% 0.94% 52%
0.75 2.28 1.01 65
1.00% 1.89% 1.19% 52%
0.76 1.51 1.20 65
0.75 1.94 1.28 48
1.45 1.75 4.46 39
1.45 2.47 7.42 76
1.45 2.24 9.47 41
1.24 2.26 36.39 74
1.02 2.67 28.60 80
1.79% 1.10% 1.94% 52%
1.75 1.58 2.01 65
0.88% 2.30% 0.95% 72%
0.79 1.93 1.03 116
1.09% 2.08% 1.20% 72%
0.81 1.88 1.23 116
0.81 2.07 1.31 104
1.50 1.61 4.18 146
1.50 2.60 5.13 116
1.50 4.09 4.21 113
1.38 4.07 8.68 102
1.20 4.02 15.60 51
1.88% 1.22% 1.95% 72%
1.68 0.47 2.03 116
</TABLE>
<TABLE>
<CAPTION>
REALIZED
AND
UNREALIZED DIVIDENDS DISTRIBUTIONS NET ASSET
NET ASSET NET GAINS OR FROM NET DISTRIBUTIONS FROM VALUE
VALUE BEGINNING INVESTMENT (LOSSES) ON INVESTMENT FROM RETURN END OF
OF PERIOD INCOME (LOSS) INVESTMENTS INCOME CAPITAL GAINS OF CAPITAL PERIOD TOTAL RETURN
<S> <C> <C> <C> <C> <C> <C> <C> <C>
REGIONAL EQUITY
INSTITUTIONAL CLASS
1995 $12.52 $ 0.11 $4.90 $(0.08) $(0.32) $-- $17.13 41.40%
1994(1) 12.41 0.07 0.11 (0.07) -- -- 12.52 1.46%+
RETAIL CLASS A
1995 $12.52 $ 0.08 $4.90 $(0.06) $(0.32) $-- $17.12 41.17%
1994 11.96 0.08 0.71 (0.07) (0.16) -- 12.52 6.76%
1993(2) 10.00 0.05 1.96 (0.05) -- -- 11.96 20.17%+
RETAIL CLASS B
1995 $12.50 $ 0.04 $4.80 $(0.03) $(0.32) $-- $16.99 39.98%
1994(3) 12.19 -- 0.33 (0.02) -- -- 12.50 2.73%+
EMERGING GROWTH
INSTITUTIONAL CLASS
1995 $10.56 $ 0.03 $2.99 $(0.02) $(0.15) $-- $13.41 29.16%
1994(12) 10.00 0.01 0.56 (0.01) -- -- 10.56 5.68%+
RETAIL CLASS A
1995 $10.57 $ 0.01 $2.99 $(0.02) $(0.15) $-- $13.40 28.82%
1994(12) 10.00 0.01 0.57 (0.01) -- -- 10.57 5.88%+
RETAIL CLASS B
1995 $10.55 $(0.03) $2.92 $ -- $(0.15) $-- $13.29 27.89%
1994(3) 9.89 (0.01) 0.67 -- -- -- 10.55 6.67%+
TECHNOLOGY
INSTITUTIONAL CLASS
1995 $11.19 $(0.03) $7.31 $ -- $(0.23) $-- $18.24 66.22%
1994(12) 10.00 (0.01) 1.20 -- -- -- 11.19 11.90%+
RETAIL CLASS A
1995 $11.19 $(0.03) $ 7.31 $ -- $(0.23) $ -- $18.24 66.22%
1994(12) 10.00 (0.01) 1.20 -- -- -- 11.19 11.90%+
RETAIL CLASS B
1995 $11.17 $(0.04) $ 7.12 $ -- $(0.23) $ -- $18.02 64.52%
1994(3) 9.85 (0.02) 1.34 -- -- -- 11.17 13.40%+
INTERNATIONAL
INSTITUTIONAL CLASS
1995 $10.22 $ 0.01 $ 0.07 $ -- $ -- $ -- $10.30 0.78%
1994(12) 10.00 (0.01) 0.23 -- -- -- 10.22 2.20%+
RETAIL CLASS A
1995 $10.21 $ -- $ 0.07 $ -- $ -- $ -- $10.28 .69%
1994(13) 9.98 (0.01) 0.24 -- -- -- 10.21 2.30%+
RETAIL CLASS B
1995 $10.21 $(0.03) $ 0.02 $ -- $ -- $ -- $10.20 (0.10)%
1994(3) 10.23 (0.01) (0.01) -- -- -- 10.21 (0.20)%+
REAL ESTATE SECURITIES FUND
INSTITUTIONAL CLASS
1995(14) $10.00 $ 0.13 $ 0.39 $(0.11) $ -- $(0.04) $10.37 5.19%+
RETAIL CLASS A
1995(15) $10.37 $ -- $ 0.01 $ -- $ -- $ -- $10.38 0.00%
RETAIL CLASS B
1995(15) $10.37 $ -- $ -- $ -- $ -- $ -- $10.37 0.00%
(table continued)
RATIO OF
RATIO OF NET EXPENSES TO
RATIO OF INVESTMENT AVERAGE
NET ASSETS EXPENSES TO INCOME (LOSS) NET ASSETS PORTFOLIO
END OF AVERAGE TO AVERAGE (EXCLUDING TURNOVER
PERIOD (000) NET ASSETS NET ASSETS WAIVERS) RATE
$188,583 0.84% 0.78% 0.95% 42%
96,045 0.80 0.82 1.05 41
$ 14,917 1.05% 0.58% 1.20% 42%
8,345 0.82 0.59 1.25 41
58,427 0.80 0.59 1.30 28
$ 7,630 1.84% (0.25)% 1.95% 42%
185 1.80 (0.41) 2.05 41
$ 41,716 0.84% 0.20% 1.19% 51%
6,849 0.80 0.23 2.59 19
$ 386 1.04% 0.00% 1.44% 51%
91 0.79 0.23 2.84 19
$ 268 1.84% (0.83)% 2.19% 51%
18 1.80 (0.85) 3.59 19
$ 29,272 0.88% (0.35)% 1.30% 74%
6,491 0.80 (0.21) 3.12 43
$ 1,464 1.13% (0.61)% 1.55% 74%
61 0.80 (0.21) 3.37 43
$ 2,031 1.88% (1.41)% 2.30% 74%
2 1.80 (1.44) 4.12 43
$ 94,400 1.74% 0.12% 1.81% 57%
47,963 1.75 (0.19) 2.05 16
$ 876 1.93% (0.13)% 2.06% 57%
464 1.75 (0.26) 2.30 16
$ 306 2.76% (0.95)% 2.81% 57%
22 2.75 (0.71) 3.05 16
$ 5,756 0.80% 6.01% 2.34% 0%
$ 1 1.05% 0.00% 2.59% 0%
$ 1 1.80% 0.00% 3.34% 0%
</TABLE>
The accompanying notes are an integral part of the financial statements.
+ Returns, excluding sales charges, are for the period indicated and have not
been annualized.
(1) Institutional Class shares have been offered since February 4, 1994. All
ratios for the period have been annualized.
(2) Commenced operations on December 14, 1992. All ratios for the period have
been annualized.
(3) Retail Class B shares have been offered since August 15, 1994. All ratios
for the period have been annualized.
(4) Institutional Class shares have been offered since August 2, 1994. All
ratios for the period have been annualized.
(5) On April 28, 1994 the Board of Directors approved a change in this Fund's
fiscal year end from November 30 to September 30, effective September 30,
1994. All ratios for the period have been annualized.
(6) For the period ended November 30.
(7) Commenced operations on December 18, 1992. All ratios for the period have
been annualized.
(8) Commenced operations on November 15, 1994. All ratios for the period have
been annualized.
(9) On September 3, 1991, the Board of Directors of FAIF approved a change in
the FAIF's fiscal year end from October 31 to September 30, effective
September 30, 1991. All ratios for the period have been annualized.
(10) For the period ended October 31.
(11) Commenced operations on December 22, 1987. All ratios for the period have
been annualized.
(12) Commenced operations on April 4, 1994. All ratios for the period have been
annualized.
(13) Retail Class A shares have been offered since April 7, 1994. All ratios for
the period have been annualized.
(14) Commenced operations on June 30, 1995. All ratios for the period have been
annualized.
(15) Commenced operations on September 29, 1995. All ratios for the period have
been annualized.
NOTES TO FINANCIAL STATEMENTS----SEPTEMBER 30, 1995
1 ORGANIZATION
The First American Prime Obligations Fund, Government Obligations Fund and
Treasury Obligations Fund are funds offered by First American Funds, Inc. (FAF).
The First American Limited Term Income Fund, Intermediate Term Income Fund,
Fixed Income Fund, Intermediate Government Bond Fund, Mortgage Securities Fund,
Limited Term Tax Free Income Fund, Intermediate Tax Free Fund, Colorado
Intermediate Tax Free Fund, Minnesota Insured Intermediate Tax Free Fund, Asset
Allocation Fund, Balanced Fund, Equity Index Fund, Equity Income Fund, Limited
Volatility Stock Fund, Diversified Growth, Stock Fund, Special Equity Fund,
Regional Equity Fund, Emerging Growth Fund, Technology Fund, International Fund
and Real Estate Securities Fund are funds offered by First American Investment
Funds, Inc. (FAIF). FAF and FAIF (collectively the "Funds") are registered under
the Investment Company Act of 1940, as amended, as open end, management
investment companies. The Funds' articles of incorporation permit the Board of
Directors to create additional funds in the future.
FAF offers Class A, Class B, Class C and Class D shares. Class B shares are only
available pursuant to an exchange for Class B shares of another fund in the
First American family. Class B shares may also be subject to a contingent
deferred sales charge for six years and automatically convert to Class A shares
after eight years. Class C and D shares are offered only to qualifying
institutional investors. Class A and B shares are not offered by the Government
Obligations Fund or Treasury Obligations Fund.
FAIF offers Class A, Class B and Class C shares. Class A shares are sold with a
front-end sales charge. Class B shares may be subject to a contingent deferred
sales charge for six years and automatically convert to Class A shares after
eight years. Class C shares have no sales charge and are offered only to
qualifying institutional investors.
All classes of shares in FAF and FAIF have identical voting, dividend,
liquidation and other rights, and the same terms and conditions, except that the
level of distribution fees charged may differ among classes.
2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The significant accounting policies followed by the Funds are as follows:
Security Valuation -- Investment securities held by the FAF Funds are stated at
amortized cost which approximates market value. Under the amortized cost method,
any discount or premium is amortized ratably to the maturity of the security and
is included in interest income.
FAIF Fund investments in equity securities which are traded on a national
securities exchange (or reported on the NASDAQ national market system) are
stated at the last quoted sales price if readily available for such equity
securities on each business day; other equity securities traded in the
over-the-counter market and listed equity securities for which no sale was
reported on that date are stated at the last quoted bid price. Debt obligations
exceeding sixty days to maturity which are actively traded are valued by an
independent pricing service at the most recently quoted bid price. Debt
obligations with sixty days or less remaining until maturity may be valued at
their amortized cost. Foreign securities are valued based upon quotation from
the primary market in which they are traded. When market quotations are not
readily available, securities are valued at fair value as determined in good
faith by procedures established and approved by the Board of Directors.
Security Transactions and Investment Income -- The Funds record security
transactions on the trade date of the security purchase or sale. Dividend income
is recorded on the ex-dividend date. Interest income, including amortization of
bond premium and discount, is recorded on the accrual basis. Security gains and
losses are determined on the basis of identified cost, which is the same basis
used for Federal income tax purposes.
Distributions to Shareholders -- Distributions from net investment income for
the FAF funds are declared on a daily basis and are payable on the first
business day of the following month.
Limited Term Income Fund, Intermediate Term Income Fund, Fixed Income Fund,
Intermediate Government Bond Fund, Mortgage Securities Fund, Limited Tax Free
Income Fund, Intermediate Tax Free Fund, Colorado Intermediate Tax Free Fund,
Minnesota Insured Intermediate Tax Free Fund, Asset Allocation Fund, Balanced
Fund, Equity Index Fund, Equity Income Fund, Limited Volatility Stock Fund,
Diversified Growth, Stock Fund and Special Equity Fund declare and pay income
dividends monthly. Regional Equity Fund, Emerging Growth Fund, Technology Fund
and Real Estate Securities Fund declare and pay income dividends quarterly. A
portion of the quarterly distributions of the Real Estate Securities Fund may be
a return of capital. International Fund declares and pays dividends annually.
Any net realized capital gains on sales of securities for a fund are distributed
to shareholders at least annually.
Federal Taxes -- It is each Fund's intention to continue to qualify as a
regulated investment company and distribute all of its taxable income.
Accordingly, no provision for Federal income taxes is required. For Federal
income tax purposes, required distributions related to realized gains from
security transactions are computed as of October 31st.
The amounts of distributions from net investment income and net realized capital
gains are determined in accordance with federal income tax regulations, which
may differ from those amounts determined under generally accepted accounting
principles. These book/tax differences are either temporary or permanent in
nature. These differences are primarily due to wash sales, foreign currency
gains and losses, the character of distributions made during the year from net
investment income or net realized gains, and the timing of distributions where
the fiscal year in which the amounts are distributed may differ from the year
that the income or realized gains (losses) were recorded by the fund. To the
extent these differences are permanent, adjustments are made to the appropriate
accounts in the period that the difference arises.
On the Statement of Net Assets the following adjustments were made (000):
<TABLE>
<CAPTION>
ACCUMULATED UNDISTRIBUTED
NET REALIZED NET INVESTMENT
GAIN (LOSS) INCOME PAID-IN-CAPITAL
<S> <C> <C> <C>
Mortgage Securities Fund $ -- $ 1 $ (1)
Limited Term Tax Free Income
Fund -- 16 (16)
Equity Income Fund 2 16 (18)
Diversified Growth Fund -- 18 (18)
Technology Fund (70) 70 --
International Fund (1,870) 1,942 (72)
</TABLE>
Futures Transactions -- In order to gain exposure to or protect against changes
in the market, certain Funds may enter into S&P Stock Index futures contracts
and other stock futures contracts.
Upon entering into a futures contract, the Fund is required to deposit cash or
pledge "U.S." Government securities in an amount equal to five percent of the
purchase price indicated in the futures contract (initial margin). Subsequent
payments, which are dependent on the daily fluctuations in the value of the
underlying security or securities, are made or received by the Fund each day
(daily variation margin) and are recorded as unrealized gains or losses until
the contracts are closed. When the contracts are closed, the Fund records a
realized gain or loss equal to the difference between the proceeds from (or cost
of) the closing transaction and the Fund's basis in the contracts. Risks of
entering into futures contracts, in general, include the possibility that there
will not be a perfect price correlation between the futures contracts and the
underlying securities. Second, it is possible that a lack of liquidity for
futures contracts could exist in the secondary market, resulting in an inability
to close a futures position prior to its maturity date. Third, the purchase of a
futures contract involves the risk that a Fund could lose more than the original
margin deposit required to initiate a futures transaction. Unrealized gains or
losses on outstanding positions in futures contracts held at the close of the
year will be recognized as capital gains or losses for Federal income tax
purposes.
Repurchase Agreements -- The Funds may enter into repurchase agreements with
member banks of the Federal Deposit Insurance Company or registered broker
dealers whom the Adviser or Sub-Adviser deems creditworthy under guidelines
approved by the Board of Directors, subject to the seller's agreement to
repurchase such securities at a mutually agreed upon date and price. The
repurchase price would generally equal the price paid by the Fund plus interest
negotiated on the basis of current short-term rates.
Securities pledged as collateral for repurchase agreements are held by the
custodian bank until the respective agreements mature. The Portfolios may also
invest in tri-party repurchase agreements. Securities held as collateral for
tri-party repurchase agreements are maintained in a segregated account by the
broker's custodian bank until the maturity of the repurchase agreement.
Provisions of the repurchase agreements ensure that the market value of the
collateral, including accrued interest thereon, is sufficient in the event of
default of the counterparty. If the counterparty defaults and the value of the
collateral declines or if the counterparty enters an insolvency proceeding,
realization of the collateral by the Funds may be delayed or limited.
Securities Purchased on a When-Issued Basis -- Delivery and payment for
securities which have been purchased by a Fund on a forward commitment or
when-issued basis can take place up to a month or more after the transaction
date. During this period, such securities are subject to market fluctuations and
the portfolio maintains, in a segregated account with its custodian, assets with
a market value equal to or greater than the amount of its purchase commitments.
Foreign Currency Translation -- The books and records of the International Fund
are maintained in U.S. dollars on the following bases:
(I) market value of investment securities, assets and liabilities at the
current rate of exchange; and
(II) purchases and sales of investment securities, income and expenses at
the relevant rates of exchange prevailing on the respective dates of
such transactions.
The International Fund does not isolate that portion of gains and losses on
investments in equity securities which is due to changes in the foreign exchange
rates from that which is due to change in market prices of equity securities.
The International Fund reports certain foreign currency related transactions as
components of realized gains for financial reporting purposes, whereas such
components are treated as ordinary income for Federal income tax purposes.
Forward Foreign Currency Contracts -- The International Fund enters into forward
foreign currency contracts as hedges against either specific transactions or
fund positions. The aggregate principal amount of the contracts are not recorded
as the International Fund intends to settle the contracts prior to delivery. All
commitments are "marked-to-market" daily at the applicable foreign exchange rate
and any resulting unrealized gains or losses are recorded currently. The
International Fund realizes gains or losses at the time the forward contracts
are extinguished. Unrealized gains or losses on outstanding positions in forward
foreign currency contracts held at the close of the year will be recognized as
ordinary income or loss for Federal income tax purposes.
Expenses -- Expenses that are directly related to one of the Funds are charged
directly to that Fund. Other operating expenses are prorated to the Funds on the
basis of relative net asset value. Class specific expenses, such as the 12b-1
fees, are borne by that class. Income, other expenses and realized and
unrealized gains and losses of a Fund are allocated to the respective class on
the basis of the relative net asset value each day.
Reclassifications--Certain 1994 amounts have been reclassified to conform to the
1995 presentation.
3 INVESTMENT SECURITY TRANSACTIONS
During the period ended September 30, 1995, purchases of securities and proceeds
from sales of securities, other than temporary investments in short-term
securities, were as follows (000):
U.S. GOVERNMENT OTHER INVESTMENT
SECURITIES SECURITIES
PURCHASES SALES PURCHASES SALES
LIMITED TERM INCOME
FUND $ -- $ -- $ 74,585 $ 81,308
Intermediate Term
Income Fund 59,322 48,029 7,233 3,305
Fixed Income Fund 284,883 187,929 90,278 4,145
Intermediate
Government
Bond Fund 80,785 12,073 -- --
Mortgage Securities
Fund 7,556 9,626 -- 828
Limited Term Tax
Free Income Fund -- -- 6,690 16,610
Intermediate Tax
Free Fund -- -- 54,813 18,684
Colorado
Intermediate
Tax Free Fund -- -- 47,203 6,978
Minnesota Insured
Intermediate Tax
Free Fund -- -- 56,348 18,913
Asset Allocation
Fund 18,135 25,225 8,538 17,094
Balanced Fund 81,725 69,853 61,094 48,355
Equity Index Fund -- -- 23,845 15,271
Equity Income Fund -- -- 35,119 8,248
Limited Volatility
Stock Fund -- -- 16,771 3,764
Diversified Growth
Fund -- -- 88,212 20,985
Stock Fund -- -- 185,121 112,466
Special Equity Fund -- -- 129,316 96,874
Regional Equity Fund -- -- 90,522 52,378
Emerging Growth Fund -- -- 35,381 9,769
Technology Fund -- -- 26,509 12,106
International Fund -- -- 81,374 37,836
Real Estate
Securities Fund -- -- 5,351 10
At September 30, 1995 the total cost of securities for Federal Income Tax
purposes, was not materially different from amounts reported for financial
reporting purposes. The aggregate gross unrealized appreciation and depreciation
for securities held by the Funds at September 30, 1995 is as follows (000):
AGGREGATE AGGREGATE
GROSS GROSS
APPRECIATION DEPRECIATION NET
LIMITED TERM INCOME FUND $ 517 $ (492) $ 25
Intermediate Term Income Fund 1,319 (462) 857
Fixed Income Fund 7,056 (552) 6,504
Intermediate Government Bond Fund 3,355 (14) 3,341
Mortgage Securities Fund 394 (252) 142
Limited Term Tax Free Income Fund 60 (2) 58
Intermediate Tax Free Fund 1,174 (40) 1,134
Colorado Intermediate Tax Free Fund 2,017 (6) 2,011
Minnesota Insured Intermediate
Tax Free Fund 2,253 (27) 2,226
Asset Allocation Fund 5,860 (436) 5,424
Balanced Fund 21,781 (1,462) 20,319
Equity Index Fund 50,873 (4,047) 46,826
Equity Income Fund 6,217 (408) 5,809
Limited Volatility Stock Fund 2,964 (42) 2,922
Diversified Growth Fund 22,650 (1,034) 21,616
Stock Fund 46,444 (2,802) 43,642
Special Equity Fund 18,642 (3,626) 15,016
Regional Equity Fund 52,684 (5,681) 47,003
Emerging Growth Fund 7,308 (1,370) 5,938
Technology Fund 7,751 (1,013) 6,738
International Fund 13,763 (4,094) 9,669
Real Estate Securities Fund 211 (41) 170
At September 30, 1995 the following funds have capital loss carrryforwards
(000):
EXPIRATION
AMOUNT DATE
PRIME OBLIGATIONS FUND $ 4 2001
Government Obligations Fund 35 2003
Limited Term Income* 3,907 2000-2004
Intermediate Term Income Fund 260 2003
Intermediate Government
Bond Fund 139 2002-2004
Mortgage Securities Fund 31 2004
Limited Term Tax Free
Income Fund 1 2003
Limited Volatility Stock Fund 131 2004
Diversified Growth Fund 761 2002
International Fund 5,975 2003-2004
* Includes carryover acquired in connection with Managed Income merger; the
ability to utilize these losses to offset gains may be limited in future
years.
4 FEES AND EXPENSES
Pursuant to an investment advisory agreement (the Agreement), First Bank
National Association (the Adviser) manages each Fund's assets and furnishes
related office facilities, equipment, research and personnel. The Agreement
requires each Fund to pay the Adviser a monthly fee based upon average daily net
assets. The fee for each of the FAF Funds is equal to an annual rate of .40% of
the average daily net assets. The fee for each of the FAIF Funds, other than the
International Fund, is equal to an annual rate of .70% of the average daily net
assets. The fee for the International Fund is equal to an annual rate of 1.25%
of average daily net assets. Through a separate contractual agreement, First
Trust National Association, an affiliate of the Adviser, serves as the Funds'
custodian. Marvin & Palmer Associates, Inc., serves as Sub-Adviser to the
International Fund pursuant to a Sub-Advisory Agreement with the Adviser.
SEI Financial Services Company (SFS) and SEI Financial Management Corporation,
(SFM) serve as distributor and administrator of the Funds, respectively. Under
the distribution plan, each of the Funds pay SFS a monthly distribution fee of
.25% of each Fund's average daily net assets of the Retail Class A shares, 1.00%
of the Retail Class B shares and .15% of the Corporate Trust Class D shares,
which may be used by SFS to provide compensation for sales support and
distribution activities. No distribution fees are paid by Institutional Class C
shares. Prior to January 20, 1995 the FAF Funds paid SFS a monthly distribution
fee of .20% of each Fund's average daily net assets of the Retail Class A shares
under $100 million, .15% of the average daily net assets from $100 million to
less than $250 million and .10% of average daily net assets of $250 million or
more. The Institutional Class C shares paid SFS a monthly distribution fee of up
to .05% on average daily net assets under $500 million, .04% on the average
daily net assets from $500 million to less than $1 billion and .03% of average
daily net assets of $1 billion or more. SFM provides administrative services,
including certain accounting, legal and shareholder services, at an annual rate
of .07% of each FAF Fund's, and .12% of each FAIF Fund's, average daily net
assets, with a minimum annual fee of $50,000 per Fund. Prior to January 31, 1995
the FAIF Funds paid SFM at an annual rate of .20% of each Fund's average daily
net assets with a minimum annual fee of $50,000 per Fund.
In addition to the investment advisory and management fees, custodian fees,
distribution fees, administrator and transfer agent fees, each fund is
responsible for paying most other operating expenses including organization
costs, fees and expenses of outside directors, registration fees, printing
shareholder reports, legal, auditing, insurance and other miscellaneous
expenses.
During the period ended September 30, 1995, the Adviser and other parties waived
a portion of their contractual fees in order to assist the Funds in maintaining
competitive expense ratios. Expenses were waived as follows (000):
WAIVER OF
INVESTMENT WAIVER OF WAIVER OF
ADVISORY ADMINISTRATOR DISTRIBUTION
FEES FEES FEES (1)
PRIME OBLIGATIONS FUND* $2,118 $-- $571
Government Obligations Fund* 746 -- 263
Treasury Obligations Fund 902 -- --
Limited Term Income Fund 375 23 24
Intermediate Term Income
Fund 179 20 7
Fixed Income Fund 449 42 6
Intermediate Government
Bond Fund 198 11 5
Mortgage Securities Fund 99 -- 1
Limited Term Tax Free
Income Fund 112 2 2
Intermediate Tax Free Fund 112 -- 2
Colorado Intermediate Tax
Free Fund 126 -- 3
Minnesota Insured
Intermediate Tax Free Fund 149 6 5
Asset Allocation Fund 89 8 --
Balanced Fund 215 40 7
Equity Index Fund 1,054 37 --
Equity Income Fund 125 2 1
Limited Volatility
Stock Fund 60 -- --
Diversified Growth Fund 207 10 1
Stock Fund 327 47 4
Special Equity Fund 83 41 4
Regional Equity Fund 125 31 4
Emerging Growth Fund 77 -- --
Technology Fund 71 -- --
International Fund 44 5 --
Real Estate Securities Fund 18 -- --
(1) Retail Class A
* Distribution Waiver is for Institutional Class
For the period ended September 30, 1995, legal fees and expenses were paid to a
law firm of which the Secretary of the Funds is a partner.
Effective April 14, 1995, Supervised Service Company was acquired by DST
Systems, Inc. DST Systems, Inc. now provides transfer agent services for the
Funds.
A Contingent Deferred Sales Charge (CDSL) is imposed on redemptions made in the
Retail Class B. The CDSL varies depending on the number of years from time of
payment for the purchase of Class B shares until the redemption of such shares.
CONTINGENT DEFERRED SALES
CHARGE
YEAR SINCE AS A PERCENTAGE OF DOLLAR
PURCHASE AMOUNT SUBJECT TO CHARGE
First 5.00%
Second 5.00%
Third 4.00%
Fourth 3.00%
Fifth 2.00%
Sixth 1.00%
Seventh 0.00%
Eighth 0.00%
For the period ended September 30, 1995, sales charges retained by SFS for
distributing the Funds' shares were approximately $110,000.
5 DEFERRED ORGANIZATIONAL COSTS
The Funds incurred organization expenses in connection with their start-up and
initial registration. These costs are being amortized over 60 months on a
straight-line basis.
6 FORWARD FOREIGN CURRENCY CONTRACTS
The International Fund enters into forward foreign currency exchange contracts
as hedges against portfolio positions. Such contracts, which protect the value
of the Portfolio's investment securities against a decline in the value of the
hedged currency, do not eliminate fluctuations in the underlying prices of the
securities. They simply establish an exchange rate at a future date. Also,
although such contracts tend to minimize the risk of loss due to a decline in
the value of a hedged currency, at the same time they tend to limit any
potential gain that might be realized should the value of such foreign currency
increase.
The following forward foreign currency contracts were outstanding at September
30, 1995.
INTERNATIONAL FUND
NET
CONTRACTS TO IN UNREALIZED
DELIVER/ EXCHANGE APPRECIATION/
SETTLEMENT RECEIVE FOR (DEPRECIATION)
DATES (000) (000) (000)
Foreign Currency
Sales 10/04/95 CH 2,750 $ (2,259) $(120)
10/04/95 CH 390 (321) (16)
10/27/95 CH 2,110 (1,856) 26
10/04/95 DM 2,210 (1,503) (44)
10/04/95 DM 270 (183) (6)
10/04/95 DM 420 (283) (11)
10/27/95 DM 2,220 (1,571) 16
10/04/95 FI 16,500 (3,762) (98)
10/27/95 FI 10,320 (2,414) 0
10/04/95 FF 5,850 (1,162) (27)
10/04/95 FF 870 (172) (5)
10/27/95 FF 4,200 (854) 1
10/04/95 UK 4,080 (6,301) (141)
10/04/95 UK 410 (634) (14)
10/27/95 UK 3,060 (4,831) 6
10/05/95 UK 225 (355) 0
10/04/95 JY 2,048,240 (21,140) 468
10/04/95 JY 181,180 (1,818) (10)
10/04/95 JY 940,460 (9,369) (123)
10/27/95 JY 1,115,370 (11,349) 48
10/02/95 JY 20,364 (204) (1)
10/04/95 NG 650 (391) (15)
10/04/95 NG 4,010 (2,437) (69)
10/04/95 NG 670 (405) (13)
10/27/95 NG 3,470 (2,190) 19
10/03/95 NG 341 (214) 0
10/04/95 NO 6,240 (965) (29)
10/27/95 NO 3,920 (629) 5
10/04/95 SK 65,630 (8,901) (565)
10/27/95 SK 25,770 (3,650) (59)
10/03/95 SG 58 (41) 0
10/05/95 SG 62 (44) 0
$(92,208) $(777)
Foreign Currency
Purchases 10/4/95 CH 1,030 $ 905 $ (14)
10/4/95 CH 1,720 1,511 (23)
10/4/95 CH 390 343 (5)
10/4/95 CH 211 185 (2)
10/4/95 DM 680 477 (1)
10/4/95 DM 1,530 1,081 (11)
10/4/95 DM 270 191 (2)
10/4/95 DM 420 297 (3)
10/4/95 FI 6,230 1,458 --
10/4/95 FI 10,270 2,403 --
10/4/95 FF 800 157 5
10/4/95 FF 1,750 356 --
10/4/95 FF 3,300 672 (2)
10/4/95 FF 870 177 --
10/4/95 UK 1,450 2,292 (3)
10/4/95 UK 2,630 4,155 (3)
10/4/95 UK 410 648 --
10/4/95 JY 409,850 3,931 205
10/4/95 JY 631,130 6,052 317
10/4/95 JY 1,007,260 10,218 (52)
10/4/95 JY 181,180 1,838 (9)
10/4/95 JY 940,460 9,540 (48)
10/2/95 JY 32,689 328 2
10/2/95 JY 14,004 140 1
10/3/95 JY 8,924 90 --
10/4/95 NG 1,830 1,146 (2)
10/4/95 NG 2,180 1,374 (12)
INTERNATIONAL FUND
NET
CONTRACTS TO IN UNREALIZED
DELIVER/ EXCHANGE APPRECIATION/
SETTLEMENT RECEIVE FOR (DEPRECIATION)
DATES (000) (000) (000)
10/4/95 NG 670 422 (4)
10/4/95 NG 650 410 (4)
10/4/95 NO 2,160 345 (1)
10/4/95 NO 4,080 655 (5)
10/4/95 SK 24,710 3,440 123
10/4/95 SK 15,440 2,194 33
10/4/95 SK 25,480 3,618 57
$63,049 $ 537
$(240)
CURRENCY LEGEND
CH Switzerland
DM Germany
FI Finnish Mark
FF French Francs
JY Japanese Yen
NG Netherlands Guilder
NO Norwegian Krona
SG Singapore Dollar
SK Swedish Krona
UK British Pounds Sterling
7 FUTURES CONTRACTS
The Equity Index Fund's investment in S&P 500 Index futures contracts is
designed to maintain sufficient liquidity to meet redemption requests and to
increase the level of Fund assets devoted to replicating the composition of the
S&P 500 Index while reducing transaction costs. Risks of entering into S&P 500
Index futures contracts include the possibility that there may be an illiquid
market and that a change in the value of the contract may not correlate with
changes in the underlying securities. At September 30, 1995, open long S&P 500
Index futures contracts were as follows:
NUMBER UNREALIZED
OF TRADE SETTLEMENT GAIN/(LOSS)
CONTRACTS PRICE MONTH (000)
4 $588.00 DECEMBER 1995 $ 0
3 584.35 December 1995 6
3 584.50 December 1995 6
3 590.05 December 1995 (3)
2 583.55 December 1995 5
2 588.15 December 1995 0
1 586.30 December 1995 1
1 587.20 December 1995 0
1 588.55 December 1995 0
$15
8 CONCENTRATION OF CREDIT RISK
The Limited Term Tax Free Income Fund, Intermediate Tax Free Fund, Colorado
Intermediate Tax Free Fund, and Minnesota Insured Intermediate Tax Free Fund
invest in debt instruments of municipal issuers. Although these Funds monitor
investment concentration, the issuers ability to meet their obligations may be
affected by economic developments in a specific state or region.
The Limited Term Tax Free Income Fund, Intermediate Tax Free Fund, Minnesota
Insured Intermediate Tax Free Fund, and Colorado Intermediate Tax Free Fund
invest in securities which include revenue bonds, tax and revenue anticipation
notes, and general obligation bonds. At September 30, 1995, the percentage of
portfolio investments by each revenue source was as follows:
LIMITED MINNESOTA
TERM INSURED
TAX FREE INTERMEDIATE INTERMEDIATE COLORADO
INCOME TAX FREE TAX FREE INTERMEDIATE
FUND FUND FUND TAX FREE FUND
REVENUE BONDS:
Education Bonds 4% 4% 6% 4%
Health Care Bonds 4 13 13 4
Transportation
Bonds 6 3 2 8
Utility Bonds 11 12 7 8
Housing Bonds 14 12 23 6
Pollution Control
Bonds 0 5 6 4
Public Facility
Bonds 7 6 1 2
Industrial Bonds 8 0 0 1
Other 10 14 11 11
GENERAL
OBLIGATIONS: 36 29 26 52
ANTICIPATION
NOTES: 0 2 5 0
100% 100% 100% 100%
The rating of long-term debt as a percentage of total value of investments at
September 30, 1995 is as follows:
LIMITED
TERM MINNESOTA COLORADO
TAX FREE INTERMEDIATE INSURED INTERMEDIATE
INCOME TAX FREE INTERMEDIATE TAX FREE
FUND FUND TAX FREE FUND FUND
STANDARD &
POORS/MOODY'S
RATINGS:
AAA/Aaa 39% 63% 74% 50%
AA/Aa 22 20 9 31
A/A 26 9 10 15
BBB/Baa 0 4 0 1
NR 13 4 7 3
100% 100% 100% 100%
Securities rated by only one agency are shown in that category. Securities rated
by both agencies are shown with their highest rating.
9 FUND MERGERS
Prior to January 20, 1995, five different mutual funds existed as separate
series of FAF: Money Fund, Institutional Money Fund, CT Government Fund,
Institutional Government Fund and CT Treasury Fund. On December 16, 1994, FAF
shareholders approved a plan of reorganization. Effective January 20, 1995,
Money Fund was merged with and into Institutional Money Fund and the combined
entity is now the Prime Obligations Fund. Also effective on such date, CT
Government Fund was merged with and into Institutional Government Fund and the
combined entity is now the Government Obligations Fund. In addition, the name of
CT Treasury Fund was changed to Treasury Obligations Fund. The mergers were
accompanied by a tax-free exchange of 63,816,319 shares of Money Fund for
63,816,319 shares of Prime Obligations Retail Class A and an exchange of
156,260,107 shares of CT Government Fund for 156,260,107 shares of Government
Obligations Corporate Trust Class as of the close of business on January 20,
1995. The aggregate net assets of Prime Obligations Fund and Money Fund before
the acquisition were $1,498,492,068 and $63,816,316, respectively, resulting in
combined net assets of $1,562,308,384 on January 20, 1995, and the aggregate net
assets of Government Obligations Fund and CT Government Fund before the
acquisition were $602,905,803 and $156,260,107, respectively, resulting in
combined net assets of $759,165,910 on January 20, 1995.
On February 3, 1995 Limited Term Income Fund acquired all net assets of First
American Mutual Fund (FAMF) Managed Income Fund pursuant to a plan of
reorganization approved by the FAMF shareholders on December 16, 1994. The
acquisition was accompanied by a tax-free exchange of 4,045,016 shares of
Managed Income Fund Institutional Class for 3,916,789 shares of Limited Term
Income Fund Institutional Class, and 482,125 shares of Managed Income Fund
Retail Class A for 467,560 shares of Limited Term Income Fund Retail Class A
outstanding as of the close of business on February 3, 1995. Managed Income Fund
net assets at the date were combined with those of Limited Term Income Fund. The
aggregate net assets of Limited Term Income Fund and Managed Income Fund before
the acquisition were $77,167,375 and $42,915,945 (including $2,579,628 of
accumulated net realized loss on investments, $1,131,202 of net unrealized
depreciation of investments, and $41,584,512 of paid-in capital for
Institutional Class, and $5,042,263 of paid-in capital for Retail Class A),
respectively, resulting in combined net assets of $120,083,320 on February 3,
1995.
In addition, under the reorganization agreement the FAMF Limited Term Tax Free
Income, FAMF Equity Income, and FAMF Diversified Growth Funds, were merged into
a new FAIF fund which was identical to the respective FAMF fund.
10 PROPOSED FUND MERGER OF LIMITED VOLATILITY STOCK FUND AND STOCK FUND
The Board of Directors of the Funds have approved, subject to shareholder
approval, the acquisition of the FAIF Limited Volatility Stock Fund by the FAIF
Stock Fund. The acquisition will be accounted for by the method of accounting
for tax free mergers of investment companies (sometimes referred to as the
pooling without restatement method). Under the proposed merger agreement and
plan of reorganization, Institutional Class shares of the FAIF Limited
Volatility Stock Fund will be exchanged for Institutional Class shares of the
FAIF Stock Fund. If the exchange were to have occurred as of September 30, 1995,
one share of the FAIF Limited Volatility Stock Fund Institutional Class would
have been exchanged for 0.6089 shares of the FAIF Stock Fund Institutional
Class.
INDEPENDENT AUDITORS' REPORT
The Board of Directors and Shareholders
First American Funds, Inc.
First American Investment Funds, Inc.:
We have audited the accompanying statements of net assets as of September 30,
1995, and the related statements of operations, the statements of changes in net
assets and the financial highlights for each of the three funds constituting
First American Funds, Inc. and each of the twenty-two funds constituting First
American Investment Funds, Inc. for each of the periods presented. These
financial statements and the financial highlights are the responsibility of the
Funds' management. Our responsibility is to express an opinion on these
financial statements and the financial highlights based on our audits. The
financial highlights of Limited Term Tax Free Income Fund, Equity Income Fund
and Diversified Growth Fund for the periods presented ended November 30, 1993
were audited by other auditors whose reports dated January 20, 1994 expressed
unqualified opinions on this information.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and the financial
highlights are free of material misstatement. An audit also includes examining,
on a test basis, evidence supporting the amounts and disclosures in the
financial statements. Investment securities held in custody are confirmed to us
by the custodian. As to securities purchased and sold but not received or
delivered, we request confirmations from brokers and where replies are not
received, we carry out other appropriate auditing procedures. 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 the financial highlights referred
to above present fairly, in all material respects, the financial position of
each of the three funds constituting First American Funds, Inc. and each of the
twenty-two funds constituting First American Investment Funds, Inc. as of
September 30, 1995, and the results of their operations, changes in their net
assets and the financial highlights for the periods presented, in conformity
with generally accepted accounting principles.
KPMG Peat Marwick LLP
Minneapolis, Minnesota
November 3, 1995
NOTICE TO SHAREHOLDERS
The information set forth below is for the funds' fiscal year as required by
federal law. Shareholders, however, must report distributions on a calendar year
basis for income tax purposes which may include distributions for portions of
two fiscal years of the fund. Accordingly, the information needed by
shareholders for income tax purposes will be sent to them in early 1996. Please
consult your tax adviser for proper treatment of this information.
Dear First American Fund Shareholders:
For the fiscal year ended September 30, 1995, each fund is designating long
term capital gains and exempt income with regard to distributions paid during
the year as follows:
<TABLE>
<CAPTION>
(A) (B) (C)
LONG TERM CAPITAL GAINS ORDINARY INCOME TOTAL (D) (E)
DISTRIBUTIONS (TAX DISTRIBUTIONS (TAX DISTRIBUTION QUALIFYING TAX EXEMPT
FUND BASIS) BASIS) (TAX BASIS) DIVIDENDS(1) INTEREST
<S> <C> <C> <C> <C> <C>
Prime Obligations 0% 100% 100% 0% 0%
Government Obligations 0% 100% 100% 0% 0%
Treasury Obligations 0% 100% 100% 0% 0%
Limited Term Income 0% 100% 100% 0% 0%
Intermediate Term Income 0% 100% 100% 0% 0%
Fixed Income 0% 100% 100% 0% 0%
Intermediate Government Bond 0% 100% 100% 0% 0%
Mortgage Securities 0% 100% 100% 0% 0%
Limited Term Tax Free Income 0% 100% 100% 0% 100%
Intermediate Tax Free 0% 100% 100% 0% 100%
Colorado Intermediate Tax Free 0% 100% 100% 0% 100%
Minnesota Insured Intermediate Tax Free 0% 100% 100% 0% 100%
Asset Allocation 42% 58% 100% 37% 0%
Balanced 21% 79% 100% 28% 0%
Equity Index 18% 82% 100% 87% 0%
Equity Income 0% 100% 100% 78% 0%
Limited Volatility 0% 100% 100% 92% 0%
Diversified Growth 0% 100% 100% 98% 0%
Stock 33% 67% 100% 51% 0%
Special Equity 20% 80% 100% 25% 0%
Regional Equity 78% 22% 100% 11% 0%
Emerging Growth 0% 100% 100% 5% 0%
Technology 0% 100% 100% 0% 0%
International 0% 0% 0% 0% 0%
</TABLE>
* Items (A) and (B) are based on a percentage of the fund's total
distributions.
** Items (D) and (E) are based on a percentage of ordinary income distribution
of the portfolio.
(1) Qualifying dividends represent dividends which qualify for the corporate
dividends received deduction.
(2) The Real Estate Securities Fund is not shown due to the fact that the tax
year end is December 31st.
SHAREHOLDER VOTING RESULTS
A special meeting of shareholders originally called for June 20, 1995 was
adjourned until August 7, 1995, at which the shareholders of FAIF voted on a
series of proposals (the "Proposals"). Each Proposal and the results of the
shareholder meeting are set forth below:
I. Proposal to establish the number of members of the Board of Directors of
FAIF at seven and to elect a Board of Directors.
ROBERT J.
DAYTON WELLES B. EASTMAN IRVING D. FISH LEONARD W. KEDROWSKI
FOR 116,765,106 116,765,106 116,765,106 116,765,106
Against 0 0 0 0
Abstain 994,031 944,031 994,031 994,031
JOSEPH D.
STRAUSS VIRGINIA L. STRINGER GAE B. VEIT
FOR 116,765,106 116,765,106 116,765,106
Against 0 0 0
Abstain 994,031 994,031 994,031
II. Proposal to approve amendment to FAIF's articles of incorporation which
would reduce the quorum required to conduct business at shareholder
meetings from 30% of all outstanding shares to 10% of all outstanding
shares or, in the case of voting by classes or series of shares, such
percentages of the applicable classes or series, was to be submitted to all
shareholders of the funds represented at the meeting.
For 105,328,017
Against 7,554,496
Abstained 1,490,059
Broker
non-votes 3,386,565
There were no other proposals voted on at such meeting.
FIRST AMERICAN FUNDS, INC.
FIRST AMERICAN INVESTMENT FUNDS, INC.
680 East Swedesford Road
Wayne, Pennsylvania 19087
Investment Adviser
FIRST BANK NATIONAL ASSOCIATION
601 Second Avenue South
Minneapolis, Minnesota 55480
Custodian
FIRST TRUST NATIONAL ASSOCIATION
180 East Fifth Street
St. Paul, Minnesota 55101
Administrator
SEI FINANCIAL MANAGEMENT CORPORATION
680 East Swedesford Road
Wayne, Pennsylvania 19087
Transfer Agent
DST SYSTEMS, INC.
210 West Tenth Street
Seventh Floor Tower
Kansas City, Missouri 64105
Distributor
SEI FINANCIAL SERVICES COMPANY
680 East Swedesford Road
Wayne, Pennsylvania 19087
Independent Auditors
KPMG PEAT MARWICK LLP
90 South Seventh Street
Minneapolis, Minnesota 55402
Counsel
DORSEY & WHITNEY P.L.L.P.
220 South Sixth Street
Minneapolis, Minnesota 55402
This report and the financial statements contained herein are submitted for the
general information of the shareholders of the corporation. The report is not
authorized for distribution to prospective investors in the corporation unless
preceded or accompanied by an effective prospectus for each of the Funds
included. Shares in the Funds are not deposits or obligations of, or guaranteed
or endorsed by, First Bank National Association or any of its affiliates. Such
shares are also not federally insured by the Federal Deposit Insurance
Corporation, the Federal Reserve Board, or any other agency. Investment in the
shares involve investment risk including loss of principal amount invested.
FAIF-1303 11/95
