INCOME
TOTAL RETURN
ANNUAL
REPORT
September 30, 1999 Countrywide Investments
Short Term Government
Income Fund
Institutional Government
Income Fund
Money Market Fund
Intermediate Bond Fund
Intermediate Term Government
Income Fund
Adjustable Rate U.S. Government
Securities Fund
LOGO: COUNTRYWIDE INVESTMENTS
<PAGE>
TABLE OF CONTENTS
- --------------------------------------------------------------------------------
Letter from the President.....................................................3
Management Discussion and Analysis..........................................4-6
Statements of Assets and Liabilities........................................7-8
Statements of Operations...................................................9-10
Statements of Changes in Net Assets.......................................11-13
Financial Highlights......................................................14-19
Notes to Financial Statements.............................................20-24
Portfolios of Investments:
Short Term Government Income Fund...................................25
Institutional Government Income Fund.............................26-27
Money Market Fund................................................28-29
Intermediate Bond Fund...........................................30-31
Intermediate Term Government Income Fund............................32
Adjustable Rate U.S. Government Securities Fund.....................33
Notes to Portfolios of Investments...........................................34
Report of Independent Public Accountants.....................................35
Results of Special Meeting of Shareholders...................................36
2 - Countrywide Investments
<PAGE>
LETTER FROM THE PRESIDENT
- --------------------------------------------------------------------------------
PICTURE OF ROBERT H. LESHNER
Dear Fellow Shareholders:
We are pleased to present Countrywide Investment Trust's Annual Report for the
fiscal year ended September 30, 1999. This report provides financial data and
performance information for the Short Term Government Income Fund, Institutional
Government Income Fund, Money Market Fund, Intermediate Bond Fund, Intermediate
Term Government Income Fund and Adjustable Rate U.S. Government Securities Fund.
These Funds represent the six taxable money market and bond products currently
offered among the 16 mutual funds which comprise the Countrywide Family of
Funds.
We are pleased to announce that on October 29, 1999, Fort Washington Investment
Advisors, Inc., a registered investment advisory firm and part of the
Western-Southern Enterprise, completed the acquisition of Countrywide Financial
Services, Inc. The Western-Southern Enterprise, a dynamic financial services
group, includes The Western and Southern Life Insurance Company,
Western-Southern Life Assurance Company, Columbus Life Insurance Company,
Touchstone Advisors, Capital Analysts and Eagle Realty Group. With this
acquisition, Western-Southern Enterprise assets owned or under management have
passed the $20 billion mark. In cooperation with Fort Washington Investment
Advisors, we look forward to offering shareholders enhanced flexibility,
responsiveness and product diversity.
In spite of recent market volatility, the economy remains remarkably strong. We
attribute this to increased activity in the manufacturing sector, low
unemployment, healthy sales in the housing market, strong GDP growth, negligible
inflation and unwavering consumer confidence. Markets suffered losses during the
quarter ended September 30, 1999, but this was indicative of a market correction
rather than a persistent trend.
Interest rate increases during the year put downward price pressure on bonds.
Consequently, the bond market endured its worst year since 1994 and the second
worst year on record. Negatives for bonds were many. The Federal Reserve raised
interest rates in June and August, the domestic U.S. economy continued to be
very strong, commodity prices rose, the U.S. dollar fell and corporate bond
supply was heavy. Continued strength in the global economy, including Asia's
recovery, Europe's growing economic momentum and strength in Latin America also
weighed negatively on the U.S. bond market.
For fixed-income investors, we see attractive opportunities in the corporate,
mortgage-backed and government agency sectors of the market. All of these
sectors currently provide attractive spreads relative to Treasuries with the
potential for additional return should spreads begin to narrow.
Countrywide Investments remains committed to providing products and services
that help investors meet their financial goals. Our success has been built on
the confidence investors have extended to us. We thank you for your support and
look forward to offering continued service to you in the future.
Sincerely,
/s/ Robert H. Leshner
Robert H. Leshner
President
Countrywide Investments - 3
<PAGE>
INTERMEDIATE BOND FUND
MANAGEMENT DISCUSSION AND ANALYSIS
- --------------------------------------------------------------------------------
During the fiscal year, the Intermediate Bond Fund continued to shift its focus
from an income orientation to a total return orientation. While we have worked
to change the profile of the Fund, it has been difficult to move out of certain
securities. As a result, the Fund at fiscal year-end maintained a substantial
position in high yielding, intermediate to longer-maturity premium corporate
bonds, a segment that has lagged the general improvement experienced by
investment grade corporate bonds. For the year ended September 30, 1999, the
Fund's total return (excluding the impact of applicable sales loads) was -3.71%,
as compared to 0.63% for the Lehman Brothers Intermediate Government/Corporate
Bond Index.
Since the beginning of the fiscal year, we have sold almost $8 million in
corporate securities, some of which fit the income-oriented profile. While we
have reduced our overall exposure to corporates by over 30%, many of the
remaining positions still have an income orientation. It is our intention to
continue to cycle out of most of these positions so that we may purchase
corporate securities with better total return profiles.
Interest rate spreads in the investment grade, fixed-income arena ended the
fiscal year mostly unchanged. Day-to-day volatility, however, was not for the
faint of heart. Spread performance in the corporate sector was similar to that
of the mortgage sector with spreads widening dramatically early in the fiscal
year, then narrowing through December and January as volatility declined and
interest rates settled into a range. In late June, a vigilant Federal Reserve,
concerned over tight labor markets and a robust economy, pushed interest rates
higher. This, combined with fresh memories of the 1998 liquidity crisis,
fostered uncertainty and resulted in much wider spreads. With such wide swings
in relative valuation, sector positioning was critical to performance during the
year.
Late in the fiscal year, we slightly reduced the Fund's duration, bringing it in
line with our peers. The Fund currently maintains a slight overweight in the
mortgage-backed sector, at approximately 33% versus a target weighting of 30%.
Going forward, we will look to reallocate our exposure to mortgage-backed
securities, selling 30-year collateral for a position in hybrid adjustable-rate
mortgages where there is compelling relative value. We also plan to continue to
work out of income-oriented corporate bonds in favor of high-quality, global
corporate deals where liquidity and performance appears greatest. We expect to
maintain a neutral to slightly short duration as the overall trend in interest
rates remains bearish.
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT IN THE INTERMEDIATE
BOND FUND AND THE LEHMAN BROTHERS INTERMEDIATE GOVERNMENT/CORPORATE BOND INDEX
Intermediate Bond Fund
Average Annual Total Returns
1 Year Since Inception*
(8.28)% 3.83%
Lehman Brothers Intermediate
Government/Corporate Bond Index Intermediate Bond Fund
- --------------------------------------------------------------------------------
10/95 10000 9525
10352 9756
10266 9730
10331 9816
9/96 10515 9921
10772 10212
10760 10161
11078 10564
9/97 11377 10917
11620 11194
11802 11351
12025 11593
9/98 12565 12068
12601 11962
12577 11782
12527 11603
9/99 12642 11621
Past performance is not predictive of future performance.
*Fund inception was October 3, 1995.
4 - Countrywide Investments
<PAGE>
INTERMEDIATE TERM GOVERNMENT INCOME FUND MANAGEMENT
DISCUSSION AND ANALYSIS
- --------------------------------------------------------------------------------
Fiscal year 1999 was a difficult year in the fixed-income markets as
intermediate-term Treasury yields increased by approximately 1.5%. During this
period, however, there were many opportunities to capitalize on trades of
relative value, as sector volatility was extremely high. Generally,
short-duration funds fared well while the spike in interest rates pressured
intermediate and long-term funds. For the fiscal year ended September 30, 1999,
the Intermediate Term Government Income Fund's total return (excluding the
impact of applicable sales loads) was -1.93%, as compared to 0.78% for the
Lehman Brothers Intermediate Government Bond Index.
During the fiscal year, we witnessed dramatic changes in the basis, or spread,
of mortgage-backed securities (MBS), corporate securities and agency debentures.
Option-adjusted spreads on MBS widened from 80 basis points (bps) to 160 bps
early in the year, then recovered to 80 bps by May of 1999, one example of the
dramatic change in relative value in the non-Treasury sectors. With such wide
swings in relative valuation, sector positioning was critical to performance
during the fiscal year.
The Fund's prospectus was amended to provide for greater use of government MBS.
We began allocating assets to the mortgage sector early in 1999, but missed a
substantial portion of the rally experienced in this sector. This reallocation,
combined with the Fund's slightly longer duration relative to its peer group,
hindered performance in mid-1999 as interest rates continued to climb and
spreads on MBS temporarily widened. Since then, we have shortened the Fund's
duration and further bolstered our exposure to the mortgage sector. The Fund
currently maintains an exposure of approximately 26% to MBS, just shy of our
target exposure of 30%.
With inflation showing signs of life, consumption strong and the Federal Reserve
now maintaining a tightening bias, Treasuries are likely to remain under
pressure. Recent uncertainty regarding the Fed has fostered volatility in the
fixed-income markets. With the tremendous performance in the mortgage market, we
will now look to reduce our exposure, most likely investing the proceeds in
agency debentures, both callable and non-callable. We have our eye on the hybrid
adjustable rate mortgage (ARM) market and are looking to add exposure to this
sector with a modest widening of spreads.
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT IN THE INTERMEDIATE
TERM GOVERNMENT INCOME FUND AND THE LEHMAN BROTHERS INTERMEDIATE GOVERNMENT BOND
INDEX
Intermediate Term Government Income Fund
Average Annual Total Returns:
1 Year 5 Years 10 Years
(6.59)% 5.33% 6.13%
Lehman Brothers Intermediate Intermediate Term Government
Government Bond Index Income Fund
- --------------------------------------------------------------------------------
"9/89" 10000 9525
10341 9800
10327 9670
10651 9938
"9/90" 10857 10031
11329 10484
11578 10686
11774 10819
"9/91" 12333 11454
12927 12065
12791 11795
13288 12296
"9/92" 13870 12975
13823 12861
14340 13516
14621 13888
"9/93" 14929 14292
14952 14190
14675 13613
14593 13357
"9/94" 14705 13325
14690 13295
15302 13978
16016 14810
"9/95" 16264 14994
16808 15537
16693 15223
16805 15240
"9/96" 17094 15525
17489 15930
17486 15840
17973 16289
"9/97" 18434 16728
18841 17081
19125 17323
19479 17682
"9/98" 20389 18491
20440 18442
20385 18268
20344 18061
"9/99" 20549 18135
Past performance is not predictive of future performance.
Countrywide Investments - 5
<PAGE>
ADJUSTABLE RATE U.S. GOVERNMENT SECURITIES FUND
MANAGEMENT DISCUSSION AND ANALYSIS
- --------------------------------------------------------------------------------
Interest rates rose steadily during the Adjustable Rate U.S. Government
Securities Fund's fiscal year with short-term rates up roughly 0.50% and
intermediate to long-term rates up approximately 1.50%. The Federal Reserve, in
response to the international liquidity crisis, cut the fed funds rate twice
from 5.25% to 4.75%, then raised the fed funds rate twice, returning it to 5.25%
and effectively "taking back" the added liquidity. This change in policy was
prompted by the global economic recovery and, more specifically, by above-trend
economic growth domestically. The Fund performed well during this period of
uncertainty returning 5.22%, as compared to 4.30% for the Lehman Brothers
Adjustable Rate Mortgage (ARM) Index.
The Fund's performance was enhanced by its focus on the seasoned, one-year
constant maturity Treasury (CMT) sector, which performed well during the fiscal
year. The market for these securities firmed as the general increase in interest
rates and steepening of the yield curve worked to slow prepayments on ARMs. With
ARMs back in vogue at the origination level, the supply of ARM securities has
picked up and enhanced liquidity in the sector.
We continue to find relative value in low gross margin GNMA ARMs with October
reset dates. These securities generally have 6.75% coupons, prepay more slowly
than newer issuance and can be purchased at slight premiums. Another area that
is especially attractive from an income perspective is fixed-rate collateralized
mortgage obligations (CMOs) with short average lives where we can typically pick
up 0.50% in yield over one-year CMT ARMs. And, regarding our core holding of
one-year CMT ARMs, the additional supply, combined with a slower and more stable
prepayment outlook, should allow prices to continue firming.
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT IN THE ADJUSTABLE RATE
U.S. GOVERNMENT SECURITIES FUND AND THE LEHMAN BROTHERS ARM INDEX
Adjustable Rate U.S. Government Securities Fund
Average Annual Total Returns:
1 Year 5 Years Since Inception*
5.22% 5.41% 4.82%
Adjustable Rate U.S. Government
Lehman Brothers ARM Index Securities Fund
- --------------------------------------------------------------------------------
"2/93" 10000 10000
10045 10048
10235 10168
"9/93" 10346 10274
10399 10371
10353 10435
10312 10469
"9/94" 10383 10489
10400 10423
10836 10682
11173 10897
"9/95" 11362 11048
11618 11240
11746 11428
11879 11569
"9/96" 12102 11746
12397 11945
12563 12092
12824 12327
"9/97" 13074 12490
13290 12636
13492 12761
13683 12853
"9/98" 13884 12975
13984 13067
14209 13348
14305 13533
"9/99" 14481 13653
Past performance is not predictive of future performance.
*Fund inception was February 10, 1993.
6 - Countrywide Investments
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1999
================================================================================
<TABLE>
<CAPTION>
SHORT TERM INSTITUTIONAL MONEY
GOVERNMENT GOVERNMENT MARKET
(000's) INCOME FUND INCOME FUND FUND
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ASSETS
Investment securities:
At acquisition cost...............$ 31,205 $ 37,415 $ 23,007
===================================================
At amortized cost.................$ 31,101 $ 37,379 $ 22,975
===================================================
At market value (Note 2)..........$ 31,101 $ 37,379 $ 22,975
Repurchase agreements (Note 2)......... 78,600 12,000 --
Cash................................... -- 77 1
Interest receivable.................... 449 429 231
Organization costs, net (Note 2)....... -- -- 6
Other assets........................... 15 5 11
---------------------------------------------------
TOTAL ASSETS........................... 110,165 49,890 23,224
---------------------------------------------------
LIABILITIES
Bank overdraft......................... 3 -- --
Dividends payable...................... 4 19 4
Payable to affiliates (Note 4)......... 68 7 4
Other accrued expenses and liabilities. 30 16 18
TOTAL LIABILITIES...................... 105 42 26
NET ASSETS.............................$ 110,060 $ 49,848 $ 23,198
NET ASSETS CONSIST OF:
Paid-in capital........................$ 110,060 $ 49,870 $ 23,209
Accumulated net realized losses from
security transactions............. -- (22) (11)
----------------------------------------------------
NET ASSETS.............................$ 110,060 $ 49,848 $ 23,198
===================================================
Shares of beneficial interest outstanding
(unlimited number of shares authorized,
no par value) (Note 5)............ 110,060 49,870 23,209
===================================================
Net asset value, offering price and redemption
price per share (Note 2)..........$ 1.00 $ 1.00 $ 1.00
===================================================
</TABLE>
See accompanying notes to financial statements.
Countrywide Investments - 7
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1999
================================================================================
<TABLE>
<CAPTION>
ADJUSTABLE
INTERMEDIATE RATE U.S.
INTERMEDIATE TERM GOVERNMENT
BOND GOVERNMENT SECURITIES
(000'S) Fund Income Fund Fund
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ASSETS
Investment securities:
At acquisition cost $ 11,887 $ 45,330 $ 8,692
=======================================================================
At amortized cost $ 11,887 $ 45,289 $ 8,692
=======================================================================
At market value (Note 2) $ 11,527 $ 44,615 $ 8,705
Cash -- 1 1
Interest and principal paydowns receivable 168 649 68
Receivable for capital shares sold 2 11 5
Receivable from affiliates (Note 4) 1 -- 6
Organization costs, net (Note 2) 6 -- --
Other assets 10 12 10
-----------------------------------------------------------------------
TOTAL ASSETS 11,714 45,288 8,795
-----------------------------------------------------------------------
LIABILITIES
Dividends payable 9 22 4
Payable for capital shares redeemed 6 164 119
Payable to affiliates (Note 4) -- 23 --
Other accrued expenses and liabilities 12 19 12
-----------------------------------------------------------------------
TOTAL LIABILITIES 27 228 135
-----------------------------------------------------------------------
NET ASSETS $ 11,687 $ 45,060 $ 8,660
=======================================================================
NET ASSETS CONSIST OF:
Paid-in capital $ 12,477 $ 48,088 $ 9,960
Accumulated net realized losses from
security transactions (430) (2,354) (1,313)
Net unrealized appreciation (depreciation)
on investments (360) (674) 13
-----------------------------------------------------------------------
NET ASSETS $ 11,687 $ 45,060 $ 8,660
=======================================================================
Shares of beneficial interest outstanding
(unlimited number of shares authorized,
no par value) (Note 5) 1,236 4,357 895
=======================================================================
Net asset value and redemption price
per share (Note 2) $ 9.45 $ 10.34 $ 9.68
=======================================================================
Maximum offering price per share (Note 2) $ 9.92 $ 10.86 $ 9.68
=======================================================================
</TABLE>
See accompanying notes to financial statements.
8 - Countrywide Investments
<PAGE>
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED SEPTEMBER 30, 1999
================================================================================
<TABLE>
<CAPTION>
SHORT TERM INSTITUTIONAL MONEY
GOVERNMENT GOVERNMENT MARKET
(000's) INCOME FUND INCOME FUND FUND
- ------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
<S> <C> <C> <C>
Interest income $ 5,413 $ 2,316 $ 1,450
----------------------------------------------------------
EXPENSES
Investment advisory fees (Note 4) 522 91 137
Transfer agent fees (Note 4) 171 18 33
Distribution expenses (Note 4) 148 3 5
Postage and supplies 62 8 27
Accounting services fees (Note 4) 36 25 24
Custodian fees 25 18 15
Registration fees 22 7 21
Professional fees 19 14 13
Standard & Poor's rating expense 13 13 --
Trustees' fees and expenses 8 8 8
Reports to shareholders 10 1 6
Amortization of organization
costs (Note 2) -- -- 6
Other expenses 13 9 11
----------------------------------------------------------
TOTAL EXPENSES 1,049 215 306
Fees waived by the Adviser (Note 4) -- (33) (128)
NET EXPENSES 1,049 182 178
----------------------------------------------------------
NET INVESTMENT INCOME 4,364 2,134 1,272
----------------------------------------------------------
NET REALIZED LOSSES FROM SECURITY
TRANSACTIONS -- -- (5)
----------------------------------------------------------
NET INCREASE IN NET ASSETS
FROM OPERATIONS $ 4,364 $ 2,134 $ 1,267
==========================================================
</TABLE>
See accompanying notes to financial statements.
Countrywide Investments - 9
<PAGE>
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED SEPTEMBER 30, 1999
================================================================================
<TABLE>
<CAPTION>
ADJUSTABLE
INTERMEDIATE RATE U.S.
INTERMEDIATE TERM GOVERNMENT
BOND GOVERNMENT SECURITIES
(000'S) FUND INCOME FUND FUND
- ------------------------------------------------------------------------------------------------
<S> <C> C> <C>
INVESTMENT INCOME
Interest income $ 1,076 3,043 $ 584
---------------------------------------------------------
EXPENSES
Investment advisory fees (Note 4) 78 231 49
Accounting services fees (Note 4) 24 24 30
Distribution expenses (Note 4) 5 62 4
Transfer agent fees (Note 4) 12 39 12
Professional fees 19 24 18
Registration fees 19 17 17
Postage and supplies 7 26 11
Trustees' fees and expenses 8 8 8
Custodian fees 6 9 8
Reports to shareholders 5 8 5
Standard & Poor's rating expense -- -- 8
Amortization of organization costs (Note 2) 6 -- --
Other expenses 8 10 6
---------------------------------------------------------
TOTAL EXPENSES 197 458 176
Fees waived and/or expenses reimbursed
by the Adviser (Note 4) (49) -- (102)
---------------------------------------------------------
NET EXPENSES 148 458 74
---------------------------------------------------------
NET INVESTMENT INCOME 928 2,585 510
---------------------------------------------------------
REALIZED AND UNREALIZED GAINS (LOSSES)
ON INVESTMENTS
Net realized gains (losses) from
security transactions (223) 390 (3)
Net change in unrealized appreciation/
depreciation on investments (1,386) (3,884) (22)
---------------------------------------------------------
NET REALIZED AND UNREALIZED LOSSES
ON INVESTMENTS (1,609) (3,494) (25)
---------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS $ (681) $ (909) $ 485
=========================================================
</TABLE>
See accompanying notes to financial statements.
10 - Countrywide Investments
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
================================================================================
<TABLE>
<CAPTION>
SHORT TERM INSTITUTIONAL
GOVERNMENT GOVERNMENT
INCOME FUND INCOME FUND
- ----------------------------------------------------------------------------------------------------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
SEPT. 30, SEPT. 30, SEPT. 30, SEPT. 30,
(000's) 1999 1998 1999 1998
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
FROM OPERATIONS
Net investment income $ 4,364 $ 4,475 $ 2,134 $ 2,598
----------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income (4,364) (4,475) (2,134) (2,598)
FROM CAPITAL SHARE
TRANSACTIONS (NOTE 5)
Proceeds from shares sold 354,333 301,198 83,427 179,615
Reinvested distributions 4,260 4,351 1,889 2,188
Payments for shares redeemed (351,014) (299,865) (80,265) (198,254)
----------------------------------------------------------------------
NET INCREASE (DECREASE)
IN NET ASSETS FROM CAPITAL
SHARE TRANSACTIONS 7,579 5,684 5,051 (16,451)
----------------------------------------------------------------------
TOTAL INCREASE (DECREASE)
IN NET ASSETS 7,579 5,684 5,051 (16,451)
NET ASSETS
Beginning of year 102,481 96,797 44,797 61,248
----------------------------------------------------------------------
End of year $ 110,060 $ 102,481 $ 49,848 $ 44,797
======================================================================
</TABLE>
See accompanying notes to financial statements.
Countrywide Investments - 11
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
================================================================================
<TABLE>
<CAPTION>
MONEY INTERMEDIATE
MARKET BOND
FUND FUND
- ----------------------------------------------------------------------------------------------------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
SEPT. 30, SEPT. 30, SEPT. 30, SEPT. 30,
(000's) 1999 1998 1999 1998
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
FROM OPERATIONS
Net investment income $ 1,272 $ 3,176 $ 928 $ 1,372
Net realized losses from
security transactions (5) (2) (223) (13)
Net change in unrealized
appreciation/depreciation
on investments -- -- (1,386) 809
-----------------------------------------------------------------------
NET INCREASE (DECREASE) IN
NET ASSETS FROM OPERATIONS 1,267 3,174 (681) 2,168
-----------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income (1,272) (3,176) (932) (1,368)
From net realized gains -- -- (138) --
-----------------------------------------------------------------------
DECREASE IN NET ASSETS FROM
DISTRIBUTIONS TO SHAREHOLDERS (1,272) (3,176) (1,070) (1,368)
-----------------------------------------------------------------------
FROM CAPITAL SHARE
TRANSACTIONS (NOTE 5)
Proceeds from shares sold 68,597 317,726 7,494 19,933
Reinvested distributions 781 674 711 530
Payments for shares redeemed (64,667) (373,727) (18,485) (13,216)
-----------------------------------------------------------------------
NET INCREASE (DECREASE)
IN NET ASSETS FROM CAPITAL
SHARE TRANSACTIONS 4,711 (55,327) (10,280) 7,247
-----------------------------------------------------------------------
TOTAL INCREASE (DECREASE)
IN NET ASSETS 4,706 (55,329) (12,031) 8,047
NET ASSETS
Beginning of year 18,492 73,821 23,718 15,671
-----------------------------------------------------------------------
End of year $ 23,198 $ 18,492 $ 11,687 $ 23,718
=======================================================================
UNDISTRIBUTED NET INVESTMENT
INCOME $ -- $ -- $ -- $ 4
=======================================================================
</TABLE>
See accompanying notes to financial statements.
12 - Countrywide Investments
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
================================================================================
<TABLE>
<CAPTION>
INTERMEDIATE TERM ADJUSTABLE RATE
GOVERNMENT U.S. GOVERNMENT
INCOME FUND SECURITIES FUND
- ----------------------------------------------------------------------------------------------------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
SEPT. 30, SEPT. 30, SEPT. 30, SEPT. 30,
(000's) 1999 1998 1999 1998
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
FROM OPERATIONS
Net investment income $ 2,585 $ 2,844 $ 510 $ 788
Net realized gains (losses) from
security transactions 390 157 (3) (59)
Net change in unrealized
appreciation/depreciation
on investments (3,884) 2,055 (22) (153)
----------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN
NET ASSETS FROM OPERATIONS (909) 5,056 485 576
----------------------------------------------------------------------------------
Distributions to Shareholders
From net investment income (2,585) (2,844) (510) (788)
----------------------------------------------------------------------------------
FROM CAPITAL SHARE
TRANSACTIONS (NOTE 5)
Proceeds from shares sold 12,477 14,138 4,152 8,357
Reinvested distributions 2,271 2,508 467 717
Payments for shares redeemed (17,362) (20,723) (6,550) (21,448)
----------------------------------------------------------------------------------
NET DECREASE IN NET ASSETS
FROM CAPITAL SHARE TRANSACTIONS (2,614) (4,077) (1,931) (12,374)
----------------------------------------------------------------------------------
TOTAL DECREASE IN NET ASSETS (6,108) (1,865) (1,956) (12,586)
NET ASSETS
Beginning of year 51,168 53,033 10,616 23,202
----------------------------------------------------------------------------------
End of year $ 45,060 $ 51,168 $ 8,660 $ 10,616
==================================================================================
</TABLE>
See accompanying notes to financial statements.
Countrywide Investments - 13
<PAGE>
SHORT TERM GOVERNMENT INCOME FUND
FINANCIAL HIGHLIGHTS
================================================================================
<TABLE>
<CAPTION>
PER SHARE DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR
- ------------------------------------------------------------------------------------------------------------------------------------
YEARS ENDED SEPTEMBER 30,
-------------------------------------------------------------------------------------
1999 1998 1997 1996 1995
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------------------------------------------------------------------------------------
Net investment income 0.040 0.046 0.044 0.044 0.046
Dividends from net investment income (0.040) (0.046) (0.044) (0.044) (0.046)
=====================================================================================
Net asset value at end of year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Total return 4.02% 4.74% 4.53% 4.51% 4.69%
=====================================================================================
Net assets at end of year (000's) $ 110,060 $ 102,481 $ 96,797 $ 91,439 $ 87,141
=====================================================================================
Ratio of net expenses to
average net assets(A) 0.95% 0.91% 0.97% 0.99% 0.99%
Ratio of net investment income to
average net assets 3.95% 4.63% 4.43% 4.42% 4.59%
</TABLE>
(A) Absent fee waivers by the Adviser, the ratio of expenses to average net
assets would have been 0.94% for the year ended September 30, 1998.
See accompanying notes to financial statements.
14 - Countrywide Investments
<PAGE>
INSTITUTIONAL GOVERNMENT INCOME FUND
FINANCIAL HIGHLIGHTS
================================================================================
<TABLE>
<CAPTION>
PER SHARE DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR
- ------------------------------------------------------------------------------------------------------------------------------------
YEARS ENDED SEPTEMBER 30,
-------------------------------------------------------------------------------------
1999 1998 1997 1996 1995
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------------------------------------------------------------------------------------
Net investment income 0.047 0.052 0.051 0.051 0.053
-------------------------------------------------------------------------------------
Dividends from net investment income (0.047) (0.052) (0.051) (0.051) (0.053)
-------------------------------------------------------------------------------------
Net asset value at end of year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=====================================================================================
Total return 4.78% 5.30% 5.17% 5.18% 5.42%
=====================================================================================
Net assets at end of year (000's) $ 49,848 $ 44,797 $ 61,248 $ 39,382 $ 36,009
=====================================================================================
Ratio of net expenses to
average net assets(A) 0.40% 0.40% 0.40% 0.40% 0.40%
Ratio of net investment income to
average net assets 4.68% 5.17% 5.07% 5.06% 5.30%
(A) Absent fee waivers by the Adviser, the ratios of expenses to average net
assets would have been 0.47%, 0.45%, 0.45%, 0.49%, and 0.42% for the years ended
September 30, 1999, 1998, 1997, 1996 and 1995, respectively (Note 4).
</TABLE>
See accompanying notes to financial statements.
Countrywide Investments - 15
<PAGE>
MONEY MARKET FUND
FINANCIAL HIGHLIGHTS
================================================================================
<TABLE>
<CAPTION>
PER SHARE DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR
- ------------------------------------------------------------------------------------------------------------------------------------
YEAR YEAR ONE MONTH YEAR PERIOD
ENDED ENDED ENDED ENDED ENDED
SEPT. 30, SEPT. 30, SEPT. 30 AUGUST 31, AUGUST 31,
1999 1998 1997(A) 1997 1996(B)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------------------------------------------------------------------------------
Net investment income 0.046 0.050 0.004 0.050 0.046(C)
------------------------------------------------------------------------------
Dividends from net investment income (0.046) (0.050) (0.004) (0.050) (0.046)
------------------------------------------------------------------------------
Net asset value at end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
==============================================================================
Total return 4.74% 5.07% 4.99%(E) 5.14% 4.70%
==============================================================================
Net assets at end of period (000's) $ 23,198 $ 18,492 $ 73,821 $ 94,569 $ 76,363
==============================================================================
Ratio of net expenses to
average net assets(D) 0.65% 0.79% 0.80%(E) 0.65% 0.65%(E)
Ratio of net investment income to
average net assets 4.63% 4.95% 4.99%(E) 5.03% 4.94%(E)
(A) Effective as of the close of business on August 29, 1997, the Fund was
reorganized and its fiscal year-end, subsequent to August 31, 1997, was changed
to September 30.
(B) Represents the period from the commencement of operations
(September 29, 1995) through August 31, 1996.
(C) Calculated using weighted average shares outstanding during the period.
(D) Absent fee waivers and/or expense reimbursements, the ratios of expenses to
average net assets would have been 1.11%, 0.79% and 0.99%(E) for the periods
ended September 30, 1999, and August 31, 1997 and 1996, respectively (Note 4).
(E) Annualized.
</TABLE>
See accompanying notes to financial statements.
Countrywide Investments - 16
<PAGE>
INTERMEDIATE BOND FUND -- CLASS A
FINANCIAL HIGHLIGHTS
================================================================================
<TABLE>
<CAPTION>
PER SHARE DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR
- ------------------------------------------------------------------------------------------------------------------------------------
YEAR YEAR ONE MONTH YEAR PERIOD
ENDED ENDED ENDED ENDED ENDED
SEPT. 30, SEPT. 30, SEPT. 30 AUGUST 31, AUGUST 31,
1999 1998 1997(A) 1997 1996(B)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of period $ 10.50 $ 10.09 $ 10.00 $ 9.75 $ 10.00
--------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income 0.59 0.62 0.05 0.62 0.57(C)
Net realized and unrealized gains
(losses) on investments (0.97) 0.41 0.09 0.28 (0.25)(C)
--------------------------------------------------------------------------
Total from investment operations (0.38) 1.03 0.14 0.90 0.32
--------------------------------------------------------------------------
Less distributions:
Dividends from net investment
income (0.59) (0.62) (0.05) (0.62) (0.57)
Distributions from net realized
gains (0.08) -- -- (0.03) --
--------------------------------------------------------------------------
Total distributions (0.67) (0.62) (0.05) (0.65) (0.57)
--------------------------------------------------------------------------
Net asset value at end of period $ 9.45 $ 10.50 $ 10.09 $ 10.00 $ 9.75
==========================================================================
Total return(D) (3.71)% 10.54% 1.41% 9.48% 3.23%
==========================================================================
Net assets at end of period (000's) $ 11,687 $ 23,718 $ 15,671 $ 15,114 $ 13,357
==========================================================================
Ratio of net expenses to
average net assets(E) 0.95% 0.95% 0.95%(F) 0.85% 0.68%(F)
Ratio of net investment income to
average net assets 5.96% 6.08% 6.18%(F) 6.26% 6.31%(F)
Portfolio turnover rate 92% 63% 0% 41% 12%
(A) Effective as of the close of business on August 29, 1997, the Fund was
reorganized and its fiscal year-end, subsequent to August 31, 1997, was
changed to September 30.
(B) Represents the period from the commencement of
operations (October 3, 1995) through August 31, 1996.
(C) Calculated using weighted average shares outstanding during the period.
(D) Total returns shown exclude the effect of applicable sales loads.
(E) Absent fee waivers and/or expense reimbursements, the ratios of expenses to
average net assets would have been 1.27%, 0.98%, 1.38%(F), 1.53% and 2.04%(F)
for the periods ended September 30, 1999, 1998 and 1997, and August 31, 1997 and
1996, respectively (Note 4).
(F) Annualized.
</TABLE>
See accompanying notes to financial statements.
Countrywide Investments - 17
<PAGE>
INTERMEDIATE TERM GOVERNMENT INCOME FUND
FINANCIAL HIGHLIGHTS
================================================================================
<TABLE>
<CAPTION>
PER SHARE DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR
- ------------------------------------------------------------------------------------------------------------------------------
YEARS ENDED SEPTEMBER 30,
---------------------------------------------------------------------------------------
1999 1998 1997 1996 1995
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of year $ 11.15 $ 10.67 $ 10.49 $ 10.73 $ 10.14
---------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income 0.60 0.61 0.61 0.61 0.64
Net realized and unrealized gains
(losses) on investments (0.81) 0.48 0.18 (0.24) 0.59
---------------------------------------------------------------------------------------
Total from investment operations (0.21) 1.09 0.79 0.37 1.23
---------------------------------------------------------------------------------------
Dividends from net investment income (0.60) (0.61) (0.61) (0.61) (0.64)
---------------------------------------------------------------------------------------
Net asset value at end of year $ 10.34 $ 11.15 $ 10.67 $ 10.49 $ 10.73
=======================================================================================
Total return(A) (1.93)% 10.54% 7.74% 3.55% 12.52%
=======================================================================================
Net assets at end of year (000's) $ 45,060 $ 51,168 $ 53,033 $ 56,095 $ 56,969
=======================================================================================
Ratio of net expenses to
average net assets 0.99% 0.99% 0.99% 0.99% 0.99%
Ratio of net investment income to
average net assets 5.59% 5.64% 5.78% 5.75% 6.17%
Portfolio turnover rate 58% 29% 49% 70% 58%
</TABLE>
(A) Total returns shown exclude the effect of applicable sales loads.
See accompanying notes to financial statements.
18 - Countrywide Investments
<PAGE>
ADJUSTABLE RATE U.S. GOVERNMENT SECURITIES FUND
FINANCIAL HIGHLIGHTS
================================================================================
<TABLE>
<CAPTION>
PER SHARE DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR
- --------------------------------------------------------------------------------------------------------------------------------
YEARS ENDED SEPTEMBER 30,
-----------------------------------------------------------------------------------------
1999 1998 1997 1996 1995
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of year $ 9.69 $ 9.85 $ 9.81 $ 9.78 $ 9.82
-----------------------------------------------------------------------------------------
Income from investment operations:
Net investment income 0.50 0.53 0.57 0.57 0.55
Net realized and unrealized gains
(losses) on investments (0.01) (0.16) 0.04 0.03 (0.04)
-----------------------------------------------------------------------------------------
Total from investment operations 0.49 0.37 0.61 0.60 0.51
-----------------------------------------------------------------------------------------
Dividends from net investment income (0.50) (0.53) (0.57) (0.57) (0.55)
-----------------------------------------------------------------------------------------
Net asset value at end of year $ 9.68 $ 9.69 $ 9.85 $ 9.81 $ 9.78
=========================================================================================
Total return(A) 5.22% 3.88% 6.34% 6.32% 5.33%
=========================================================================================
Net assets at end of year (000's) $ 8,660 $ 10,616 $ 23,202 $ 11,732 $ 20,752
=========================================================================================
Ratio of net expenses to
average net assets(B) 0.75% 0.75% 0.75% 0.75% 0.75%
Ratio of net investment income to
average net assets 5.22% 5.47% 5.73% 5.91% 5.57%
Portfolio turnover rate 42% 45% 58% 44% 115%
</TABLE>
(A) Total returns shown exclude the effect of applicable sales loads.
(B) Absent fee waivers and/or expense reimbursements by the Adviser, the ratios
of expenses to average net assets would have been 1.80%, 1.37%, 1.47%, 1.46%
and 1.21% for the years ended September 30, 1999, 1998, 1997, 1996 and 1995,
respectively (Note 4).
See accompanying notes to financial statements.
Countrywide Investments - 19
<PAGE>
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1999
- --------------------------------------------------------------------------------
1. ORGANIZATION
The Short Term Government Income Fund, Institutional Government Income Fund,
Money Market Fund, Intermediate Bond Fund, Intermediate Term Government Income
Fund and Adjustable Rate U.S. Government Securities Fund (individually, a Fund
and, collectively, the Funds) are each a series of Countrywide Investment Trust
(the Trust). The Trust is registered under the Investment Company Act of 1940 as
an open-end management investment company. The Trust was organized as a
Massachusetts business trust under a Declaration of Trust dated December 7,
1980. The Declaration of Trust, as amended, permits the Trustees to issue an
unlimited number of shares of each Fund.
The Short Term Government Income Fund seeks high current income, consistent with
protection of capital, by investing primarily in short-term obligations issued
or guaranteed as to principal and interest by the U.S. Government, its agencies
or instrumentalities and backed by the "full faith and credit" of the United
States.
The Institutional Government Income Fund seeks high current income, consistent
with protection of capital, by investing primarily in short-term obligations
issued or guaranteed as to principal and interest by the U.S. Government, its
agencies or instrumentalities. The Fund is designed primarily for institutions
as an economical and convenient means for the investment of short-term funds.
The Money Market Fund seeks high current income, consistent with liquidity and
stability of principal. The Fund invests primarily in high-quality U.S.
dollar-denominated money market instruments.
The Intermediate Bond Fund seeks to provide as high a level of current income as
is consistent with the preservation of capital. The Fund invests in marketable
corporate debt securities, U.S. Government securities, mortgage-related
securities, other asset-backed securities and cash or money market instruments.
The maturity composition of the Fund's portfolio of fixed-income securities is
adjusted in response to market conditions and expectations.
The Intermediate Term Government Income Fund seeks high current income,
consistent with protection of capital, by investing primarily in U.S. Government
obligations having an effective maturity of twenty years or less with a
dollar-weighted effective average portfolio maturity under normal market
conditions of between three and ten years. To the extent consistent with the
Fund's primary objective, capital appreciation is a secondary objective.
The Adjustable Rate U.S. Government Securities Fund seeks high current income,
consistent with lower volatility of principal, by investing primarily in
adjustable rate mortgage securities or other securities collateralized by or
representing an interest in mortgages which have interest rates that reset at
periodic intervals. The Fund invests in mortgage-related securities only if they
are issued or guaranteed by the United States Government, its agencies or
instrumentalities.
Effective August 1, 1999, the Intermediate Bond Fund is authorized to offer two
classes of shares: Class A shares (sold subject to a maximum 4.75% front-end
sales load and a distribution fee of up to 0.35% of average daily net assets)
and Class C shares (sold subject to a 1.25% front-end sales load, a 1%
contingent deferred sales load for a one-year period and a distribution fee of
up to 1% of average daily net assets). Each Class A and Class C share of the
Fund represents identical interests in the Fund's investment portfolio and has
the same rights, except that (i) Class C shares bear the expenses of higher
distribution fees, which will cause Class C shares to have a higher expense
ratio and to pay lower dividends than those related to Class A shares; (ii)
certain other class specific expenses will be borne solely by the class to which
such expenses are attributable; and (iii) each class has exclusive voting rights
with respect to matters relating to its own distribution arrangements. As of
September 30, 1999, the public offering of Class C shares of the Fund had not
commenced.
20 - Countrywide Investments
<PAGE>
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of the Funds' significant accounting policies:
Securities valuation -- Investment securities in the Short Term Government
Income Fund, Institutional Government Income Fund and Money Market Fund are
valued on the amortized cost basis, which approximates market value. This
involves initially valuing a security at its original cost and thereafter
assuming a constant amortization to maturity of any discount or premium. This
method of valuation is expected to enable these Funds to maintain a constant net
asset value per share. Investment securities in the Intermediate Bond Fund,
Intermediate Term Government Income Fund and Adjustable Rate U.S. Government
Securities Fund for which market quotations are readily available are valued at
their most recent bid prices as obtained from one or more of the major market
makers for such securities by an independent pricing service. Securities for
which market quotations are not readily available are valued at their fair
values as determined in good faith in accordance with consistently applied
procedures approved by and under the general supervision of the Board of
Trustees.
Repurchase agreements -- Repurchase agreements, which are collateralized by U.S.
Government obligations, are valued at cost which, together with accrued
interest, approximates market. Collateral for repurchase agreements is held in
safekeeping in the customer-only account of the Funds' custodian, at the Federal
Reserve Bank of Cleveland. At the time each Fund enters into a repurchase
agreement, the seller agrees that the value of the underlying securities,
including accrued interest, will at all times be equal to or exceed the face
amount of the repurchase agreement.
Share valuation -- The net asset value per share of each Fund is calculated
daily by dividing the total value of a Fund's assets, less liabilities, by the
number of shares outstanding.
The offering price per share of the Short Term Government Income Fund,
Institutional Government Income Fund, Money Market Fund and, effective August 1,
1999, the Adjustable Rate U.S. Government Securities Fund is equal to the net
asset value per share. Also effective August 1, 1999, the maximum offering price
per share of Class A shares of the Intermediate Bond Fund and shares of the
Intermediate Term Government Income Fund is equal to the net asset value per
share plus a sales load equal to 4.99% of the net asset value (or 4.75% of the
offering price). Prior to August 1, 1999, the maximum offering price per share
of the Intermediate Bond Fund, Intermediate Term Government Income Fund and
Adjustable Rate U.S. Government Securities Fund was equal to the net asset value
per share plus a sales load equal to 2.04% of the net asset value (or 2% of the
offering price). The redemption price per share of each Fund is equal to the net
asset value per share.
Investment income -- Interest income is accrued as earned. Discounts and
premiums on securities purchased are amortized in accordance with income tax
regulations which approximate generally accepted accounting principles.
Distributions to shareholders -- Dividends arising from net investment income
are declared daily and paid on the last business day of each month to
shareholders of each Fund. With respect to each Fund, net realized short-term
capital gains, if any, may be distributed throughout the year and net realized
long-term capital gains, if any, are distributed at least once each year. Income
dividends and capital gain distributions are determined in accordance with
income tax regulations.
Security transactions -- Security transactions are accounted for on the trade
date. Securities sold are determined on a specific identification basis.
Organization costs -- Costs incurred by the Money Market Fund and Intermediate
Bond Fund in connection with their organization and registration of shares, net
of certain expenses, have been capitalized and are being amortized on a
straight-line basis over a five year period beginning with each Fund's
commencement of operations.
Estimates -- The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities at
the date of the financial statements and the reported amounts of income and
expenses during the reporting period. Actual results could differ from those
estimates.
Countrywide Investments - 21
<PAGE>
Federal income tax -- It is each Fund's policy to comply with the special
provisions of the Internal Revenue Code applicable to regulated investment
companies. As provided therein, in any fiscal year in which a Fund so qualifies
and distributes at least 90% of its taxable net income, the Fund (but not the
shareholders) will be relieved of federal income tax on the income distributed.
Accordingly, no provision for income taxes has been made.
In order to avoid imposition of the excise tax applicable to regulated
investment companies, it is also each Fund's intention to declare as dividends
in each calendar year at least 98% of its net investment income (earned during
the calendar year) and 98% of its net realized capital gains (earned during the
twelve months ended October 31) plus undistributed amounts from prior years.
As of September 30, 1999, the Institutional Government Income Fund, Money Market
Fund, Intermediate Term Government Income Fund and Adjustable Rate U.S.
Government Securities Fund had capital loss carryforwards for federal income tax
purposes of $22,343, $6,403, $2,354,472 and $1,309,556, respectively. In
addition, the Money Market Fund, Intermediate Bond Fund and Adjustable Rate U.S.
Government Securities Fund elected to defer until its subsequent tax year
$4,941, $429,852 and $3,127, respectively, of capital losses incurred after
October 31, 1998. These capital loss carryforwards and "post-October" losses may
be utilized in future years to offset net realized capital gains, if any, prior
to distributing such gains to shareholders.
The following information is based upon the federal income tax cost of portfolio
investments as of September 30, 1999:
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
ADJUSTABLE
INTERMEDIATE RATE U.S.
INTERMEDIATE TERM GOVERNMENT
BOND GOVERNMENT SECURITIES
(000's) FUND INCOME FUND FUND
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Gross unrealized appreciation $ 8 $ 271 $ 38
Gross unrealized depreciation (368) (945) (25)
----------------------------------------------------
Net unrealized appreciation (depreciation) $ (360) $ (674) $ 13
====================================================
Federal income tax cost $ 11,887 $ 45,289 $ 8,692
====================================================
3. INVESTMENT TRANSACTIONS
Investment transactions (excluding short-term investments) were as follows for the year ended
September 30, 1999:
</TABLE>
<TABLE>
<CAPTION>
ADJUSTABLE
INTERMEDIATE RATE U.S.
INTERMEDIATE TERM GOVERNMENT
BOND GOVERNMENT SECURITIES
(000's) FUND INCOME FUND FUND
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Purchases of investment securities $ 13,539 $ 25,963 $ 3,775
====================================================
Proceeds from sales and maturities of
investment securities $ 24,045 $ 27,717 $ 5,767
====================================================
- ------------------------------------------------------------------------------------------------
</TABLE>
4. TRANSACTIONS WITH AFFILIATES
The President and certain other officers of the Trust are also officers of
Countrywide Financial Services, Inc., or its subsidiaries which include
Countrywide Investments, Inc. (the Adviser), the Trust's investment adviser and
principal underwriter, and Countrywide Fund Services, Inc. (CFS), the Trust's
administrator, transfer agent and accounting services agent. Countrywide
Financial Services, Inc. is a wholly-owned subsidiary of Fort Washington
Investment Advisors, Inc., which is a wholly-owned subsidiary of The Western and
Southern Life Insurance Company.
22 - Countrywide Investments
<PAGE>
MANAGEMENT AGREEMENT
Each Fund's investments are managed by the Adviser under the terms of a
Management Agreement. Under the Management Agreement, the Short Term Government
Income Fund, Money Market Fund, Intermediate Bond Fund, Intermediate Term
Government Income Fund and Adjustable Rate U.S. Government Securities Fund each
pay the Adviser a fee, which is computed and accrued daily and paid monthly, at
an annual rate of 0.50% of its respective average daily net assets up to $50
million; 0.45% of such net assets from $50 million to $150 million; 0.40% of
such net assets from $150 million to $250 million; and 0.375% of such net assets
in excess of $250 million. The Institutional Government Income Fund pays the
Adviser a fee, which is computed and accrued daily and paid monthly, at an
annual rate of 0.20% of its average daily net assets.
In order to voluntarily reduce operating expenses during the year ended
September 30, 1999, the Adviser waived $33,050 of its advisory fees for the
Institutional Government Income Fund; waived $127,666 of its advisory fees for
the Money Market Fund; waived $49,390 of its advisory fees for the Intermediate
Bond Fund; and waived its advisory fees of $48,923 and reimbursed other
operating expenses of $53,400 for the Adjustable Rate U.S. Government Securities
Fund.
TRANSFER AGENT AND SHAREHOLDER SERVICE AGREEMENT
Under the terms of the Transfer, Dividend Disbursing, Shareholder Service and
Plan Agency Agreement between the Trust and CFS, CFS maintains the records of
each shareholder's account, answers shareholders' inquiries concerning their
accounts, processes purchases and redemptions of each Fund's shares, acts as
dividend and distribution disbursing agent and performs other shareholder
service functions. For these services, CFS receives a monthly fee at an annual
rate of $25 per shareholder account from each of the Short Term Government
Income Fund, Institutional Government Income Fund and Money Market Fund and $21
per shareholder account from each of the Intermediate Bond Fund, Intermediate
Term Government Income Fund and Adjustable Rate U.S. Government Securities Fund,
subject to a $1,000 minimum monthly fee for each Fund. In addition, each Fund
pays CFS out-of-pocket expenses including, but not limited to, postage and
supplies.
ACCOUNTING SERVICES AGREEMENT
Under the terms of the Accounting Services Agreement between the Trust and CFS,
CFS calculates the daily net asset value per share and maintains the financial
books and records of each Fund. For these services, CFS receives a monthly fee,
based on current net asset levels, of $3,000 from the Short Term Government
Income Fund, $2,000 from each of the Institutional Government Income Fund, Money
Market Fund, Intermediate Bond Fund and Intermediate Term Government Income Fund
and $2,500 from the Adjustable Rate U.S. Government Securities Fund. In
addition, each Fund pays CFS certain out-of-pocket expenses incurred by CFS in
obtaining valuations of such Fund's portfolio securities.
UNDERWRITING AGREEMENT
The Adviser is the Funds' principal underwriter and, as such, acts as exclusive
agent for distribution of the Funds' shares. Under the terms of the Underwriting
Agreement between the Trust and the Adviser, the Adviser earned $2,862, $6,683
and $1,550 from underwriting and broker commissions on the sale of shares of the
Intermediate Bond Fund, Intermediate Term Government Income Fund and Adjustable
Rate U.S. Government Securities Fund, respectively, for the year ended September
30, 1999.
PLANS OF DISTRIBUTION
The Trust has a Plan of Distribution under which shares of each Fund may
directly incur or reimburse the Adviser for expenses related to the distribution
and promotion of shares. The annual limitation for payment of such expenses
under the Plan is 0.35% of average daily net assets attributable to such shares,
except for the Institutional Government Income Fund and Class C shares of the
Intermediate Bond Fund for which the annual limitation is 0.10% and 1.00% of
average daily net assets, respectively.
Countrywide Investments -23
<PAGE>
5. CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold and payments for shares redeemed as shown in the
Statements of Changes in Net Assets are the result of the following capital
share transactions for the years shown:
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------
INTERMEDIATE TERM ADJUSTABLE RATE
INTERMEDIATE BOND GOVERNMENT U.S. GOVERNMENT
FUND - CLASS A INCOME FUND SECURITIES FUND
- -----------------------------------------------------------------------------------------------
YEAR YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
SEPT. 30, SEPT. 30, SEPT. 30, SEPT. 30, SEPT. 30, SEPT. 30,
(000's) 1999 1998 1999 1998 1999 1998
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Shares sold 750 1,948 1,170 1,313 429 852
Shares reinvested 72 51 213 232 48 73
Shares redeemed (1,844) (1,295) (1,614) (1,927) (677) (2,186)
-----------------------------------------------------------------------
Net increase (decrease) in
shares outstanding (1,022) 704 (231) (382) (200) (1,261)
-----------------------------------------------------------------------
Shares outstanding,
beginning of year 2,258 1,554 4,588 4,970 1,095 2,356
-----------------------------------------------------------------------
Shares outstanding,
end of year 1,236 2,258 4,357 4,588 895 1,095
- -----------------------------------------------------------------------------------------------
</TABLE>
Share transactions for the Short Term Government Income Fund, Institutional
Government Income Fund and Money Market Fund are identical to the dollar value
of those transactions as shown in the Statements of Changes in Net Assets.
6. FEDERAL TAX INFORMATION FOR SHAREHOLDERS (UNAUDITED)
On October 31, 1998, the Intermediate Bond Fund declared and paid a short-term
capital gain distribution of $0.007 per share and a long-term capital gain
distribution of $0.074 per share. In January of 1999, shareholders were provided
with Form 1099-DIV which reported the amounts and tax status of such capital
gain distributions paid during calendar year 1998.
24 - Countrywide Investments
<PAGE>
SHORT TERM GOVERNMENT INCOME FUND
PORTFOLIO OF INVESTMENTS
SEPTEMBER 30, 1999
- --------------------------------------------------------------------------------
PAR MARKET
VALUE VALUE
(000's) U.S. TREASURY OBLIGATIONS -- 28.3% (000's)
- --------------------------------------------------------------------------------
$ 5,000 U.S. Treasury Notes, 5.875%, 11/15/99 $ 5,007
5,000 U.S. Treasury Notes, 5.625%, 11/30/99 5,007
3,000 U.S. Treasury Notes, 5.625%, 12/31/99 3,005
2,000 U.S. Treasury Notes, 5.375%, 1/31/00 2,005
4,000 U.S. Treasury Notes, 5.50%, 2/29/00 4,010
3,000 U.S. Treasury Notes, 6.875%, 3/31/00 3,023
3,000 U.S. Treasury Notes, 6.375%, 5/15/00 3,018
4,000 U.S. Treasury Notes, 5.875%, 6/30/00 4,015
2,000 U.S. Treasury Notes, 6.125%, 7/31/00 2,011
- ------------ -------------------
$ 31,000 TOTAL U.S. TREASURY OBLIGATIONS
============ (Amortized Cost $31,101) $ 31,101
--------------
- --------------------------------------------------------------------------------
FACE MARKET
AMOUNT VALUE
(000's) REPURCHASE AGREEMENTS (NOTE A) -- 71.4% (000's)
- --------------------------------------------------------------------------------
$ 27,000 Morgan Stanley Dean Witter, Inc., 5.37%,
dated 9/30/99, due 10/01/99,
repurchase proceeds $27,004 $ 27,000
27,000 Prudential Securities, Inc.,
5.33%, dated 9/30/99, due 10/01/99,
repurchase proceeds $27,004 27,000
20,000 Nesbitt Burns Securities, Inc.,
5.30%, dated 9/30/99, due 10/01/99,
repurchase proceeds $20,003 20,000
4,600 Nesbitt Burns Securities, Inc., 4.75%,
- ------------- dated 9/30/99, due 10/01/99,
repurchase proceeds $4,601 4,600
---------------
$ 78,600 TOTAL REPURCHASE AGREEMENTS
============= (Cost $78,600) $ 78,600
---------------
TOTAL INVESTMENT SECURITIES AND
REPURCHASE AGREEMENTS -- 99.7% $ 109,701
OTHER ASSETS IN EXCESS OF LIABILITIES -- 0.3% 359
===============
NET ASSETS -- 100.0% $ 110,060
===============
See accompanying notes to portfolios of investments and notes to financial
statements.
Countrywide Investments - 25
<PAGE>
INSTITUTIONAL GOVERNMENT INCOME FUND
PORTFOLIO OF INVESTMENTS
SEPTEMBER 30, 1999
- --------------------------------------------------------------------------------
PAR MARKET
VALUE VALUE
(000's) Investment Securities -- 75.0% (000's)
- --------------------------------------------------------------------------------
U.S. GOVERNMENT AGENCY ISSUES -- 70.2%
$ 2,815 FHLB Discount Notes, 10/01/99 $ 2,815
450 FNMA Medium Term Notes, 5.81%, 10/01/99 450
750 FRMC Discount Notes, 10/05/99 750
2,000 FHLB Discount Notes, 10/06/99 1,999
250 FHLMC Discount Notes, 10/06/99 250
600 FNMA Discount Notes, 10/07/99 599
500 FFCB Discount Notes, 10/08/99 500
2,558 FHLB Discount Notes, 10/12/99 2,554
615 FFCB Discount Notes, 10/13/99 614
1,000 FNMA Medium Term Notes, 4.63%, 10/14/99 1,000
315 FNMA Medium Term Notes, 5.73%, 10/14/99 315
1,525 FHLB, 5.87%, 10/22/99 1,525
500 FHLB, 8.375%, 10/25/99 501
250 FHLB, 4.92%, 10/27/99 250
500 FHLB, 5.00%, 10/28/99 500
500 FHLB, 5.03%, 10/29/99 500
650 FFCB Discount Notes, 11/04/99 647
475 FNMA Discount Notes, 11/04/99 473
345 FNMA Medium Term Notes, 5.95%, 11/05/99 345
500 FNMA Discount Notes, 11/09/99 497
1,863 FNMA, 8.35%, 11/10/99 1,869
540 FHLMC, 6.60%, 11/12/99 541
140 FNMA Medium Term Notes, 5.83%, 11/12/99 140
235 FHLB, 5.825%, 11/19/99 235
500 FNMA, 7.68%, 11/22/99 501
200 FHLB, 5.825%, 11/26/99 200
195 FFCB, 4.85%, 12/01/99 195
250 FNMA Discount Notes, 12/01/99 248
500 FFCB Medium Term Notes, 5.63%, 12/09/99 501
100 FNMA Medium Term Notes, 5.74%, 12/09/99 100
100 FHLB, 5.00%, 12/29/99 100
400 FFCB, 4.76%, 1/18/00 399
1,000 SLMA Floating Rate Notes, 5.286%, 1/20/00 (Note B) 999
500 FHLMC, 7.90%, 1/27/00 503
1,000 FHLB Floating Rate Notes, 5.406%, 1/28/00 (Note B) 1,000
485 FHLB, 6.173%, 1/28/00 485
320 FNMA, 6.10%, 2/10/00 321
1,000 FHLB Floating Rate Notes, 5.556%, 2/25/00 (Note B) 1,000
500 FHLB, 5.04%, 3/03/00 499
125 FHLB, 5.645%, 3/06/00 125
165 FHLB, 5.16%, 3/08/00 165
550 FNMA Medium Term Notes, 5.57%, 3/17/00 550
500 FHLMC, 5.875%, 3/22/00 501
500 FNMA Medium Term Notes, 5.53%, 3/23/00 500
250 FHLB, 5.655%, 3/30/00 250
165 FHLB, 5.00%, 4/05/00 164
1,000 FHLB Floating Rate Notes,
5.346%, 4/14/00 (Note B) 1,000
26 - Countrywide Investments
<PAGE>
INSTITUTIONAL GOVERNMENT INCOME FUND (CONTINUED)
- --------------------------------------------------------------------------------
PAR MARKET
VALUE VALUE
(000'S) INVESTMENT SECURITIES -- 75.0% (CONTINUED) (000'S)
- --------------------------------------------------------------------------------
U.S. GOVERNMENT AGENCY ISSUES -- 70.2% (CONTINUED)
$ 480 FHLB, 4.97%, 4/20/00 $ 478
200 FHLB, 6.84%, 4/25/00 201
265 FHLMC, 6.395%, 5/16/00 266
200 FHLB, 5.125%, 5/19/00 199
500 FNMA Medium Term Notes, 6.41%, 5/22/00 501
400 FNMA Medium Term Notes, 5.72%, 5/22/00 400
390 FHLB, 5.625%, 6/02/00 390
494 FNMA Medium Term Notes, 6.20%, 6/06/00 495
215 FHLB, 5.415%, 6/14/00 215
1,000 SLMA Floating Rate Notes, 5.394%, 6/30/00 (Note B) 1,000
500 FHLB, 5.89%, 7/24/00 500
160 FNMA Medium Term Notes, 5.50%, 7/26/00 160
- ------------ --------------
$ 34,985 TOTAL U.S. GOVERNMENT AGENCY ISSUES
- ------------ (Amortized Cost $34,980) $ 34,980
--------------
COMMERCIAL PAPER -- 3.0%
$ 1,500 Nebraska Higher Education Loan Program,
- ------------ 10/04/99, Guarantor SLMA
(Amortized Cost $1,499) $ 1,499
--------------
VARIABLE RATE DEMAND NOTES (NOTE C) -- 1.8%
$ 900 Illinois Student Loan Assistance Commission,
- ------------ Student Loan Rev., Ser. C, 5.33%, 12/01/22,
Guarantor SLMA
(Amortized Cost $900) $ 900
--------------
$ 37,385 TOTAL INVESTMENT SECURITIES
============ (Amortized Cost $37,379) $ 37,379
--------------
- --------------------------------------------------------------------------------
FACE MARKET
AMOUNT VALUE
(000's) REPURCHASE AGREEMENTS (NOTE A) -- 24.1% (000's)
- --------------------------------------------------------------------------------
$ 12,000 Morgan Stanley Dean Witter, Inc., 5.37%,
============ dated 9/30/99, due 10/01/99,
repurchase proceeds $12,002
(Cost $12,000) $ 12,000
--------------
TOTAL INVESTMENT SECURITIES AND
REPURCHASE AGREEMENTS -- 99.1% $ 49,379
OTHER ASSETS IN EXCESS OF LIABILITIES -- 0.9% 469
--------------
NET ASSETS -- 100.0% $ 49,848
==============
See accompanying notes to portfolios of investments and notes to financial
statements.
Countrywide Investments - 27
<PAGE>
MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS
SEPTEMBER 30, 1999
- --------------------------------------------------------------------------------
PAR MARKET
VALUE VALUE
(000's) INVESTMENT SECURITIES -- 99.0% (000's)
- --------------------------------------------------------------------------------
VARIABLE RATE DEMAND NOTES (NOTE C) -- 59.1%
$ 240 Monroe Co., NY, IDA Rev.,
Ser. B, 5.50%, 10/01/00 $ 240
500 Brownsburg, IN, EDR (Zanetis Ent.),
5.70%, 6/01/03 500
855 HDR Power Systems, Inc., 5.59%, 6/01/03 855
1,380 Nassau Co., NY, IDA Rev., 5.50%, 5/17/05 1,380
601 Illinois Development Finance Auth. IDR
(Landcomp Corp.), 5.55%, 7/01/05 601
215 Schenectady, NY, IDR (JMR Development Co.),
5.55%, 12/01/07 215
765 Diamond Development Group, Inc.,
Ser. 1996, 5.62%, 9/01/08 765
1,250 North Greenbush, NY, IDA Rev., 5.70%, 11/01/08 1,250
805 Vista Funding Corp., 5.54%, 9/01/11 805
1,600 Westwood Baptist Church, OH, 5.49%, 5/01/24 1,600
1,200 Waukesha, WI, Health Systems Rev.,
5.45%, 8/15/26 1,200
500 Ontario, CA, Rev. (Mission Oaks), 5.60%, 10/01/26 500
1,500 ABAG Fin. Auth. for Nonprofit Corp., CA,
COP, Ser. D, 5.55%, 10/01/27 1,500
1,300 Illinois HFA Rev., Ser. 1998B
(Elmhurst Memorial), 5.60%, 1/01/28 1,300
550 American Healthcare Funding, 5.45%, 3/01/29 550
455 California Statewide Cmntys.
Dev. Auth. Rev., 5.50%, 5/01/29 455
- ------------ --------------
$ 13,716 TOTAL VARIABLE RATE DEMAND NOTES
- ------------ (Amortized Cost $13,716) $ 13,716
--------------
FIXED RATE REVENUE BONDS -- 7.2%
$ 400 Chicago Tax Increment Allocation
(Near South Proj.), 5.20%, 11/15/99 $ 400
250 Lehigh Co., PA, General Purpose Rev.
(St. Francis College), 5.50%,12/15/99 250
200 Umatilla Indian Reservation, OR,
Ser. 1999B, 5.60%, 2/01/00 200
500 Hamilton, OH, Parking Garage Rev., 5.66%, 3/22/00 501
315 New Britain, CT, GO, 5.32%, 5/01/00 315
- ------------ --------------
$ 1,665 TOTAL FIXED RATE REVENUE BONDS
- ------------ (Amortized Cost $1,666) $ 1,666
--------------
CORPORATE NOTES -- 27.8%
$ 130 Transamerica Financial Corp.,
8.75%, 10/01/99 $ 130
100 Wal-Mart Stores, 6.125%, 10/01/99 100
130 American General Corp., 7.70%, 10/15/99 130
100 Associates Corp., NA, 6.75%, 10/15/99 100
227 Ford Motor Co., 7.50%, 11/15/99 228
420 Merrill Lynch & Co., 8.25%, 11/15/99 421
400 Huntington Bancshares, 6.10%, 11/29/99 400
375 Associates Corp., NA, 8.25%, 12/01/99 377
250 BP America, Inc., 6.50%, 12/15/99 251
300 American General Finance, 7.00%, 12/30/99 301
250 GMAC, 5.70%, 1/10/00 250
200 AIG, 6.375%, 1/18/00 200
200 Ford Motor Credit Co., 5.83%, 2/28/00 200
100 Associates Corp., NA, 7.78%, 3/01/00 101
181 GMAC, 7.00%, 3/01/00 182
499 Associates Corp., NA, 6.00%, 3/15/00 500
150 Morgan Stanley, Dean Witter,
Discover & Co., 6.25%, 3/15/00 150
250 KeyCorp., 7.43%, 3/28/00 253
28 - Countrywide Investments
<PAGE>
MONEY MARKET FUND (CONTINUED)
- --------------------------------------------------------------------------------
PAR MARKET
VALUE VALUE
(000's) INVESTMENT SECURITIES -- 99.0% (CONTINUED) (000's)
- --------------------------------------------------------------------------------
CORPORATE NOTES -- 27.8% (CONTINUED)
$ 245 GMAC, 6.625%, 4/24/00 $ 246
165 Gannett Co., 5.85%, 5/01/00 165
330 American General Finance, 6.78%, 5/15/00 332
150 Duke Energy Corp., 7.00%, 6/01/00 151
315 Mellon Financial Co., 6.30%, 6/01/00 315
100 GMAC, 7.50%, 6/09/00 101
262 Citigroup, Inc., 6.125%, 6/15/00 262
350 Beneficial Corp., 6.45%, 6/19/00 351
250 Bear Stearns & Co., Inc., 6.75%, 8/15/00 251
- ------------ --------------
$ 6,429 TOTAL CORPORATE NOTES
- ------------ (Amortized Cost $6,448) $ 6,448
--------------
COMMERCIAL PAPER -- 4.9%
$ 880 GTE, 10/01/99 $ 880
265 Gannett Co., 10/05/99 265
- ------------ --------------
$ 1,145 TOTAL COMMERCIAL PAPER
- ------------ (Amortized Cost $1,145) $ 1,145
--------------
$ 22,955 TOTAL INVESTMENT SECURITIES -- 99.0%
============ (Amortized Cost $22,975) $ 22,975
OTHER ASSETS IN EXCESS OF LIABILITIES -- 1.0% 223
--------------
NET ASSETS -- 100.0% $ 23,198
==============
See accompanying notes to portfolios of investments and notes to financial
statements.
Countrywide Investments - 29
<PAGE>
INTERMEDIATE BOND FUND
PORTFOLIO OF INVESTMENTS
SEPTEMBER 30, 1999
- --------------------------------------------------------------------------------
PAR MARKET
VALUE VALUE
(000's) INVESTMENT SECURITIES -- 98.6% (000's)
- --------------------------------------------------------------------------------
U.S. TREASURY OBLIGATIONS -- 10.4%
$ 1,200 U.S. Treasury Notes, 6.00%, 8/15/09
- ------------ (Amortized Cost $1,221) $ 1,209
--------------
U.S. GOVERNMENT AGENCY ISSUES -- 13.0%
$ 1,600 FHLMC, 6.45%, 4/29/09
- ------------ (Amortized Cost $1,599) $ 1,524
--------------
U.S. GOVERNMENT AGENCY MORTGAGE-BACKED SECURITIES -- 32.7%
$ 52 SBA #1987-20A, 8.45%, 1/01/07 $ 52
985 FNMA #313386, 7.00%, 3/01/12 985
948 GNMA #780777, 7.00%, 4/15/28 934
977 FHLMC #C21763, 6.00%, 2/01/29 912
981 GNMA #482725, 6.50%, 3/15/29 939
- ------------ --------------
$ 3,943 TOTAL U.S. GOVERNMENT AGENCY MORTGAGE-BACKED SECURITIES
- ------------ (Amortized Cost $3,924) $ 3,822
--------------
CORPORATE BONDS -- 37.2%
$ 175 Pacific Gas & Electric Co.,
6.625%, 6/01/00 $ 175
350 Florida Residential Property & Casualty Co.,
7.25%, 7/01/02 350
259 May Department Stores Co., 9.875%, 12/01/02 283
380 Bankers Trust Corp., 7.25%, 1/15/03 383
68 U.S. Leasing International, Inc., 6.625%, 5/15/03 67
500 AT&T Corp., 5.625%, 3/15/04 479
66 Kaiser Permanente, 9.55%, 7/15/05 73
510 Honeywell, Inc., 8.625%, 4/15/06 549
500 Union Oil of California Corp.
Medium Term Notes, 6.70%, 10/15/07 479
50 Berkley (W.R.) Corp., 9.875%, 5/15/08 57
575 General Electric Capital Corp.
Medium Term Notes, 7.50%, 6/15/09 593
10 Union Camp Corp., 8.625%, 4/15/16 10
35 Kraft, Inc., 8.50%, 2/15/17 36
150 Deere & Co., 8.95%, 6/15/19 167
115 Rohm & Haas Co., 9.80%, 4/15/20 134
165 Questar Pipeline Co., 9.375%, 6/01/21 178
120 Jersey Central Power & Light Co., 9.20%, 7/01/21 125
85 Southwestern Public Service Co., 8.20%, 12/01/22 85
130 Union Electric Co., 8.00%, 12/15/22 129
- ------------ --------------
$ 4,243 TOTAL CORPORATE BONDS
- ------------ (Amortized Cost $4,523) $ 4,352
--------------
30 - Countrywide Investments
<PAGE>
INTERMEDIATE BOND FUND (CONTINUED)
- --------------------------------------------------------------------------------
PAR MARKET
VALUE VALUE
(000's) INVESTMENT SECURITIES -- 98.6% (CONTINUED) (000's)
- --------------------------------------------------------------------------------
COMMERCIAL PAPER -- 5.3%
$ 620 GTE, 10/01/99
- ------------ (Amortized Cost $620) $ 620
--------------
$ 11,606 TOTAL INVESTMENT SECURITIES -- 98.6%
============ (Amortized Cost $11,887) $ 11,527
OTHER ASSETS IN EXCESS OF LIABILITIES -- 1.4% 160
--------------
Net Assets -- 100.0% $ 11,687
==============
See accompanying notes to portfolios of investments and notes to financial
statements.
Countrywide Investments - 31
<PAGE>
INTERMEDIATE TERM GOVERNMENT INCOME FUND
PORTFOLIO OF INVESTMENTS
SEPTEMBER 30, 1999
- --------------------------------------------------------------------------------
PAR MARKET
VALUE VALUE
(000's) INVESTMENT SECURITIES -- 99.0% (000's)
- --------------------------------------------------------------------------------
U.S. TREASURY OBLIGATIONS -- 9.3%
$ 1,000 U.S. Treasury Notes, 7.75%, 2/15/01 $ 1,028
2,000 U.S. Treasury Notes, 7.50%, 11/15/01 2,071
1,000 U.S. Treasury Bonds, 7.50%, 11/15/16 1,108
- ------------ --------------
$ 4,000 TOTAL U.S. TREASURY OBLIGATIONS
- ------------ (Amortized Cost $4,151) $ 4,207
--------------
U.S. GOVERNMENT AGENCY ISSUES -- 63.5%
$ 230 FNMA Discount Notes, 10/01/99 $ 230
1,000 SLMA Medium Term Notes, 7.50%, 7/02/01 1,023
2,000 FHLB Notes, 7.31%, 7/06/01 2,042
2,000 FHLB Medium Term Notes, 8.43%, 8/01/01 2,081
2,000 FNMA Notes, 7.55%, 4/22/02 2,062
1,000 FNMA Notes, 5.125%, 2/13/04 952
2,000 FHLMC Notes, 6.80%, 7/09/04 1,990
2,000 FHLMC Notes, 8.53%, 11/18/04 2,007
2,000 FHLMC Notes, 7.65%, 5/10/05 2,011
1,400 FNMA Notes, 6.26%, 1/24/06 1,350
2,500 FNMA Notes, 6.21%, 1/26/06 2,405
2,000 FNMA Notes, 6.06%, 2/03/06 1,914
1,000 FHLMC Notes, 6.345%, 2/15/06 967
2,203 RFCO STRIPS, 10/15/08 1,241
1,000 FNMA Notes, 6.50%, 4/29/09 957
3,500 FNMA Notes, 6.375%, 6/15/09 3,423
2,000 FNMA Notes, 6.96%, 9/05/12 1,942
- ------------ --------------
$ 29,833 TOTAL U.S. GOVERNMENT AGENCY ISSUES
- ------------ (Amortized Cost $28,866) $ 28,597
--------------
U.S. GOVERNMENT AGENCY MORTGAGE-BACKED SECURITIES -- 26.2%
$ 1,657 FNMA #380592, 6.17%, 8/01/08 $ 1,592
2,688 FNMA #381464, 6.11%, 4/01/09 2,565
1,213 FNMA #1997-25E, 7.00%, 12/18/22 1,218
1,856 GNMA #455136, 7.00%, 6/15/28 1,823
1,925 FHLMC #C19286, 6.00%, 12/01/28 1,797
2,943 GNMA #482725, 6.50%, 3/15/29 2,816
- ------------ --------------
$ 12,282 TOTAL U.S. GOVERNMENT AGENCY MORTGAGE-BACKED SECURITIES
- ------------ (Amortized Cost $12,272) $ 11,811
--------------
$ 46,115 TOTAL INVESTMENT SECURITIES -- 99.0%
============ (Amortized Cost $45,289) $ 44,615
Other assets in excess of liabilities -- 1.0% 445
--------------
NET ASSETS -- 100.0% $ 45,060
==============
See accompanying notes to portfolios of investments and notes to financial
statements.
32 - Countrywide Investments
<PAGE>
ADJUSTABLE RATE U.S. GOVERNMENT SECURITIES FUND
PORTFOLIO OF INVESTMENTS
SEPTEMBER 30, 1999
- --------------------------------------------------------------------------------
PAR MARKET
VALUE VALUE
(000's) INVESTMENT SECURITIES -- 100.5% (000's)
- --------------------------------------------------------------------------------
ADJUSTABLE RATE U.S. GOVERNMENT AGENCY
MORTGAGE-BACKED SECURITIES (NOTE D) -- 76.1%
$ 736 FNMA #70907, 6.687%, 3/01/18 $ 750
855 FHLMC #605793, 6.489%, 5/01/18 873
744 FNMA #70614, 6.377%, 10/01/18 758
212 FNMA #70635, 6.515%, 6/01/20 215
946 FHLMC #846013, 7.067%, 6/01/22 974
1,005 GNMA #8217, 6.375%, 6/20/23 1,015
863 FNMA #70176, 6.497%, 8/01/27 884
1,103 FNMA #70243, 6.504%, 3/01/28 1,125
- ------------ --------------
$ 6,464 TOTAL ADJUSTABLE RATE U.S. GOVERNMENT AGENCY
- ------------ MORTGAGE-BACKED SECURITIES
(Amortized Cost $6,572) $ 6,594
FIXED RATE U.S. GOVERNMENT AGENCY
MORTGAGE-BACKED SECURITIES -- 13.1%
$ 1,121 FNMA #1997-42H, 7.00%, 12/17/19
- ------------ (Amortized Cost $1,141) $ 1,132
--------------
U.S. GOVERNMENT AGENCY ISSUES -- 11.3%
$ 979 FNMA Discount Notes, 10/01/99
- ------------ (Amortized Cost $979) $ 979
--------------
$ 8,564 TOTAL INVESTMENT SECURITIES -- 100.5%
============ (Amortized Cost $8,692) $ 8,705
LIABILITIES IN EXCESS OF OTHER ASSETS -- (0.5%) (45)
--------------
NET ASSETS -- 100.0% $ 8,660
--------------
See accompanying notes to portfolios of investments and notes to financial
statements.
Countrywide Investments - 33
<PAGE>
NOTES TO PORTFOLIO OF INVESTMENTS
SEPTEMBER 30, 1999
- --------------------------------------------------------------------------------
A. REPURCHASE AGREEMENTS
Repurchase agreements are fully collateralized by U.S. Government obligations.
B. FLOATING RATE NOTES
A floating rate note is a security whose terms provide for the periodic
readjustment of its interest rate whenever a specified interest rate index
changes and which, at any time, can reasonably be expected to have a market
value that approximates its par value. The interest rates shown represent the
effective rates as of the report date. The dates shown represent the scheduled
maturity dates.
C. VARIABLE RATE DEMAND NOTES
A variable rate demand note is a security payable on demand at par whose terms
provide for the periodic readjustment of its interest rate on set dates and
which, at any time, can reasonably be expected to have a market value that
approximates its par value. The interest rates shown represent the effective
rates as of the report date. The dates shown represent the scheduled maturity
dates.
D. ADJUSTABLE RATE U.S. GOVERNMENT AGENCY MORTGAGE-BACKED SECURITIES
Adjustable rate U.S. Government agency mortgage-backed securities are
mortgage-related securities created from pools of adjustable rate mortgages
which are issued or guaranteed as to principal and interest by the U.S.
Government, its agencies or instrumentalities. Such adjustable rate mortgage
securities have interest rates that reset at periodic intervals based on a
specified interest rate index. The interest rates shown represent the effective
rates as of the report date. The dates shown represent the scheduled maturity
date.
PORTFOLIO ABBREVIATIONS:
COP - Certificate of Participation
EDR - Economic Development Revenue
FFCB - Federal Farm Credit Bank
FHLB - Federal Home Loan Bank
FHLMC - Federal Home Loan Mortgage Corporation
FNMA - Federal National Mortgage Association
FRMC - Federal Agricultural Mortgage Corporation
GNMA - Government National Mortgage Association
HFA - Housing Finance Authority
IDA - Industrial Development Authority
IDR - Industrial Development Revenue
RFCO - Resolution Funding Corporation
SBA - Small Business Administration
SLMA - Student Loan Marketing Association
STRIPS - Separate Trading of Registered Interest and Principal of Securities
34 - Countrywide Investments
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
- --------------------------------------------------------------------------------
ARTHUR ANDERSEN LLP
To the Shareholders and Board of Trustees of Countrywide Investment Trust:
We have audited the statements of assets and liabilities, including the
portfolios of investments, of Countrywide Investment Trust (a Massachusetts
business trust) (comprising, respectively, the Short Term Government Income
Fund, the Institutional Government Income Fund, the Intermediate Term Government
Income Fund, the Adjustable Rate U.S. Government Securities Fund, the
Intermediate Bond Fund, and the Money Market Fund) as of September 30, 1999, and
(i) for the Short Term Government Income Fund, the Institutional Government
Income Fund, the Intermediate Term Government Income Fund, and the Adjustable
Rate U.S. Government Securities Fund, the related statements of operations, the
statements of changes in net assets, and the financial highlights for the
periods indicated thereon and (ii) for the Intermediate Bond Fund and the Money
Market Fund the related statements of operations for the year ended September
30, 1999, the statements of changes in net assets for the year ended September
30, 1999 and 1998, and the financial highlights for the year ended September 30,
1999, September 30, 1998, the one-month period ended September 30, 1997 and the
year ended August 31, 1997. These financial statements and financial highlights
are the responsibility of the Trust's management. Our responsibility is to
express an opinion on these financial statements and financial highlights based
on our audits. The financial highlights of the Intermediate Bond Fund and the
Money Market Fund for the period ended August 31, 1996 were audited by other
auditors whose report dated October 18, 1996, expressed an unqualified opinion
on those financial highlights.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
September 30, 1999, by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights audited by us
and referred to above present fairly, in all material respects, the financial
position of each of the respective portfolios constituting the Countrywide
Investment Trust as of September 30, 1999, the results of their operations, the
changes in their net assets, and their financial highlights for the periods
referred to above, in conformity with generally accepted accounting principles.
/S/ARTHUR ANDERSEN LLP
Cincinnati, Ohio,
October 27, 1999
Countrywide Investments - 35
<PAGE>
RESULTS OF SPECIAL MEETING OF SHAREHOLDERS
OCTOBER 27, 1999
- --------------------------------------------------------------------------------
On October 27, 1999, a Special Meeting of Shareholders of Countrywide Investment
Trust (the Trust) was held (1) to approve or disapprove new investment advisory
agreements with Countrywide Investments, Inc., (2) to elect nine trustees and
(3) to ratify or reject the selection of Arthur Andersen LLP as the Trust's
independent public accountants for the fiscal year ending September 30, 1999.
The total number of shares of the Trust present by proxy represented 71.0% of
the shares entitled to vote at the meeting. Each of the matters submitted to
shareholders was approved.
The results of the voting for or against the approval of the new investment
advisory agreements by each Fund was as follows:
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------
NUMBER OF SHARES
-------------------------------------------------
FOR AGAINST ABSTAIN
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C>
Short Term Government Income Fund 72,836,904.320 286,367.840 734,314.720
Institutional Government Income Fund 41,605,539.090 4,381.000 109,630.000
Money Market Fund 14,514,612.020 23,969.180 350,416.280
Intermediate Bond Fund 1,091,218.018 307.360 15,433.220
Intermediate Term
Government Income Fund 2,440,232.201 7,260.051 15,378.104
Adjustable Rate U.S. Government
Securities Fund 454,113.683 4,696.673 2,503.947
- ----------------------------------------------------------------------------------------
The results of the voting for the election of trustees was as follows:
- ----------------------------------------------------------------------------------------
Withhold
Nominees For Election Authority Status
- ----------------------------------------------------------------------------------------
William O. Coleman 134,157,859.548 339,418.159 New Trustee
Phillip R. Cox 134,158,024.888 339,252.819 New Trustee
H. Jerome Lerner 134,156,259.548 341,018.159 Incumbent
Robert H. Leshner 134,157,859.548 339,418.159 Incumbent
Jill T. McGruder 134,087,307.318 409,970.389 New Trustee
Oscar P. Robertson 133,840,125.822 657,151.885 Incumbent
Nelson Schwab, Jr. 134,001,063.367 496,214.340 New Trustee
Robert E. Stautberg 134,137,874.548 359,403.159 New Trustee
Joseph S. Stern, Jr. 134,024,040.715 473,236.992 New Trustee
- ----------------------------------------------------------------------------------------
The results of the voting for or against the ratification of Arthur Andersen LLP
as independent public accountants by each Fund was as follows:
- ----------------------------------------------------------------------------------------
NUMBER OF SHARES
-------------------------------------------------
FOR AGAINST ABSTAIN
- ----------------------------------------------------------------------------------------
Short Term Government Income Fund 73,092,196.420 99,972.790 665,417.670
Institutional Government Income Fund 41,601,925.090 11,452.000 106,173.000
Money Market Fund 14,628,812.900 517.810 259,666.770
Intermediate Bond Fund 1,106,774.674 -- 183.924
Intermediate Term
Government Income Fund 2,451,133.555 736.839 10,999.962
Adjustable Rate U.S. Government
Securities Fund 453,814.109 4,780.059 2,720.135
- ----------------------------------------------------------------------------------------
</TABLE>
36 - Countrywide Investments
<PAGE>
COUNTRYWIDE INVESTMENT TRUST
- --------------------------------------------------------------------------------
312 Walnut St., 21st Floor
Cincinnati, Ohio 45202-4094
www.countrywideinvestments.com
Nationwide: (Toll Free) 800-543-8721
Cincinnati: 629-2000
Rate Line: 579-0999
SHAREHOLDER SERVICES
- --------------------------------------------------------------------------------
Nationwide: (Toll Free) 800-543-0407
Cincinnati: 629-2050
BOARD OF TRUSTEES
- --------------------------------------------------------------------------------
William O. Coleman
Phillip R. Cox
H. Jerome Lerner
Robert H. Leshner
Jill T. McGruder
Oscar P. Robertson
Nelson Schwab, Jr.
Robert E. Stautberg
Joseph S. Stern, Jr.
INVESTMENT ADVISER/MANAGER
- --------------------------------------------------------------------------------
Countrywide Investments, Inc.
312 Walnut St., 21st Floor
Cincinnati, Ohio 45202-4094
TRANSFER AGENT
- --------------------------------------------------------------------------------
Countrywide Fund Services, Inc.
P.O. Box 5354
Cincinnati, Ohio 45201-5354
This report is authorized for distribution only when it is accompanied or
preceded by a current prospectus of Countrywide Investment Trust.
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<ARTICLE> 6
<CIK> 0000066117
<NAME> COUNTRYWIDE INVESTMENT TRUST
<SERIES>
<NUMBER> 6
<NAME> ADJUSTABLE RATE U.S. GOVERNMENT SECURITIES FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> SEP-30-1999
<PERIOD-START> OCT-01-1998
<PERIOD-END> SEP-30-1999
<INVESTMENTS-AT-COST> 8,691,801
<INVESTMENTS-AT-VALUE> 8,704,882
<RECEIVABLES> 79,268
<ASSETS-OTHER> 683
<OTHER-ITEMS-ASSETS> 10,658
<TOTAL-ASSETS> 8,795,491
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 135,427
<TOTAL-LIABILITIES> 135,427
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<PAID-IN-CAPITAL-COMMON> 9,959,666
<SHARES-COMMON-STOCK> 895,056
<SHARES-COMMON-PRIOR> 1,095,327
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (1,312,683)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 13,081
<NET-ASSETS> 8,660,064
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 583,634
<OTHER-INCOME> 0
<EXPENSES-NET> 73,384
<NET-INVESTMENT-INCOME> 510,250
<REALIZED-GAINS-CURRENT> (3,127)
<APPREC-INCREASE-CURRENT> (21,601)
<NET-CHANGE-FROM-OPS> 485,522
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 510,250
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 428,847
<NUMBER-OF-SHARES-REDEEMED> 677,383
<SHARES-REINVESTED> 48,265
<NET-CHANGE-IN-ASSETS> (1,955,567)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (1,309,556)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 48,923
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 175,707
<AVERAGE-NET-ASSETS> 9,779,673
<PER-SHARE-NAV-BEGIN> 9.69
<PER-SHARE-NII> .50
<PER-SHARE-GAIN-APPREC> (.01)
<PER-SHARE-DIVIDEND> .50
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<EXPENSE-RATIO> .75
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<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000066117
<NAME> COUNTRYWIDE INVESTMENT TRUST
<SERIES>
<NUMBER> 4
<NAME> INSTITUTIONAL GOVERNMENT INCOME FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> SEP-30-1999
<PERIOD-START> OCT-01-1998
<PERIOD-END> SEP-30-1999
<INVESTMENTS-AT-COST> 49,378,540
<INVESTMENTS-AT-VALUE> 49,378,540
<RECEIVABLES> 428,773
<ASSETS-OTHER> 76,953
<OTHER-ITEMS-ASSETS> 5,458
<TOTAL-ASSETS> 49,889,724
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 41,876
<TOTAL-LIABILITIES> 41,876
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 49,870,191
<SHARES-COMMON-STOCK> 49,870,191
<SHARES-COMMON-PRIOR> 44,818,865
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (22,343)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 49,847,848
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 2,316,254
<OTHER-INCOME> 0
<EXPENSES-NET> 182,452
<NET-INVESTMENT-INCOME> 2,133,802
<REALIZED-GAINS-CURRENT> (601)
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 2,133,201
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 2,133,802
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 83,427,220
<NUMBER-OF-SHARES-REDEEMED> 80,265,243
<SHARES-REINVESTED> 1,889,349
<NET-CHANGE-IN-ASSETS> 5,050,725
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (21,742)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 91,227
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 215,502
<AVERAGE-NET-ASSETS> 45,595,772
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> .047
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> .047
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> .40
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<ARTICLE> 6
<CIK> 0000066117
<NAME> COUNTRYWIDE INVESTMENT TRUST
<SERIES>
<NUMBER> 9
<NAME> INTERMEDIATE BOND FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> SEP-30-1999
<PERIOD-START> OCT-01-1998
<PERIOD-END> SEP-30-1999
<INVESTMENTS-AT-COST> 11,887,281
<INVESTMENTS-AT-VALUE> 11,527,189
<RECEIVABLES> 170,704
<ASSETS-OTHER> 175
<OTHER-ITEMS-ASSETS> 15,929
<TOTAL-ASSETS> 11,713,997
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 27,023
<TOTAL-LIABILITIES> 27,023
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 12,476,918
<SHARES-COMMON-STOCK> 1,236,214
<SHARES-COMMON-PRIOR> 2,258,294
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (429,852)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (360,092)
<NET-ASSETS> 11,686,974
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 1,076,245
<OTHER-INCOME> 0
<EXPENSES-NET> 148,133
<NET-INVESTMENT-INCOME> 928,112
<REALIZED-GAINS-CURRENT> (223,139)
<APPREC-INCREASE-CURRENT> (1,386,315)
<NET-CHANGE-FROM-OPS> (681,342)
<EQUALIZATION> 0
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<DISTRIBUTIONS-OF-GAINS> 137,666
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<NUMBER-OF-SHARES-REDEEMED> 1,843,840
<SHARES-REINVESTED> 72,103
<NET-CHANGE-IN-ASSETS> (12,031,137)
<ACCUMULATED-NII-PRIOR> 4,033
<ACCUMULATED-GAINS-PRIOR> (69,047)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 77,965
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 197,523
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<PER-SHARE-NAV-BEGIN> 10.50
<PER-SHARE-NII> .59
<PER-SHARE-GAIN-APPREC> (.97)
<PER-SHARE-DIVIDEND> .59
<PER-SHARE-DISTRIBUTIONS> .08
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 9.45
<EXPENSE-RATIO> .95
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<ARTICLE> 6
<CIK> 0000066117
<NAME> COUNTRYWIDE INVESTMENT TRUST
<SERIES>
<NUMBER> 3
<NAME> INTERMEDIATE TERM GOVERNMENT INCOME FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> SEP-30-1999
<PERIOD-START> OCT-01-1998
<PERIOD-END> SEP-30-1999
<INVESTMENTS-AT-COST> 45,289,813
<INVESTMENTS-AT-VALUE> 44,615,400
<RECEIVABLES> 659,384
<ASSETS-OTHER> 1,216
<OTHER-ITEMS-ASSETS> 11,544
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<TOTAL-LIABILITIES> 228,039
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<NET-ASSETS> 45,059,505
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<EXPENSES-NET> 458,103
<NET-INVESTMENT-INCOME> 2,585,227
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<PER-SHARE-GAIN-APPREC> (.81)
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<EXPENSE-RATIO> .99
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<ARTICLE> 6
<CIK> 0000066117
<NAME> COUNTRYWIDE INVESTMENT TRUST
<SERIES>
<NUMBER> 8
<NAME> MONEY MARKET FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> SEP-30-1999
<PERIOD-START> OCT-01-1998
<PERIOD-END> SEP-30-1999
<INVESTMENTS-AT-COST> 22,974,867
<INVESTMENTS-AT-VALUE> 22,974,867
<RECEIVABLES> 231,161
<ASSETS-OTHER> 838
<OTHER-ITEMS-ASSETS> 16,927
<TOTAL-ASSETS> 23,223,793
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 25,660
<TOTAL-LIABILITIES> 25,660
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 23,209,477
<SHARES-COMMON-STOCK> 23,209,477
<SHARES-COMMON-PRIOR> 18,497,649
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (11,344)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 23,198,133
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 1,450,092
<OTHER-INCOME> 0
<EXPENSES-NET> 178,497
<NET-INVESTMENT-INCOME> 1,271,595
<REALIZED-GAINS-CURRENT> (5,559)
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<NET-CHANGE-FROM-OPS> 1,266,036
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 1,271,595
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 68,597,495
<NUMBER-OF-SHARES-REDEEMED> 64,666,486
<SHARES-REINVESTED> 780,819
<NET-CHANGE-IN-ASSETS> 4,706,269
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (5,785)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 137,483
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 306,163
<AVERAGE-NET-ASSETS> 27,490,742
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> .046
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> .046
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> .65
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000066117
<NAME> COUNTRYWIDE INVESTMENT TRUST
<SERIES>
<NUMBER> 1
<NAME> SHORT TERM GOVERNMENT INCOME FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> SEP-30-1999
<PERIOD-START> OCT-01-1998
<PERIOD-END> SEP-30-1999
<INVESTMENTS-AT-COST> 109,700,758
<INVESTMENTS-AT-VALUE> 109,700,758
<RECEIVABLES> 449,372
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 15,075
<TOTAL-ASSETS> 110,165,205
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 105,272
<TOTAL-LIABILITIES> 105,272
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 110,059,933
<SHARES-COMMON-STOCK> 110,059,933
<SHARES-COMMON-PRIOR> 102,481,388
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 110,059,933
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 5,413,117
<OTHER-INCOME> 0
<EXPENSES-NET> 1,049,348
<NET-INVESTMENT-INCOME> 4,363,769
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 4,363,769
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 4,363,769
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 354,332,455
<NUMBER-OF-SHARES-REDEEMED> 351,014,267
<SHARES-REINVESTED> 4,260,357
<NET-CHANGE-IN-ASSETS> 7,578,545
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 522,067
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,049,348
<AVERAGE-NET-ASSETS> 110,469,325
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> .040
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> (.040)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> .95
</TABLE>
