UMB SCOUT FUNDS
BOND FUND
(UMBBX)
SEMIANNUAL REPORT DECEMBER 31, 1999
A no-load mutual fund with primary emphasis
on maximum current income, consistent
with its quality and maturity standards.
TO THE SHAREHOLDERS
The UMB Scout Bond Fund closed the quarter ended December
31, 1999 at $10.74 per share and had a total return (price
change and reinvested distributions) of 0.13% for the quarter.
The final quarter of 1999 saw interest rates move to their
highest levels in more than two years as both the economy
and equity markets continued to display amazing strength.
While measured inflation (reported as the CPI) was holding
steady at reasonable levels, the Federal Open Market
Committee (FOMC) increased the Fed Funds rate to 5.50% on
November 16, largely in response to exceptionally strong
economic releases. Rates moved sharply higher in late
December, as the stock markets surged to new highs almost
daily, fueling concern that the FOMC might further tighten
rates to cool the "wealth effect" from stocks. Many
strategists believe the wealth created by lofty stock values
is the primary factor driving spending and therefore, the
overall economy. Bond market participants had already
discounted the Fed Funds increase to 5.50%. Then, due to
December's strength, the debate moved quickly from whether
or not another increase could be expected - to how much the
increase would be when it happened.
The 30-year treasury began the fourth quarter at 6.05% and
ended at 6.48%. By year-end, most strategists were forecasting
another 50-basis-point increase in Fed Funds by mid-2000.
While Y2K concerns impinged liquidity during the last weeks
of the year, the agency and corporate sectors did see a
narrowing of their spread differential versus treasuries.
Relative yields for agencies and corporates moved from the
highest levels in more than five years to more average
trading ranges. This change, coupled with our holdings of
Governmental National Mortgage Association (GNMA) pools,
helped us outperform our index for the quarter. The Fund's
fourth quarter performance helped us finish the year well
ahead of our peer average. Given the inherent event risk
present in the sector, we continue to believe that high-
quality corporate bonds appear somewhat over-priced versus
values in the agency sector. As has been the case for
several quarters, we will focus new purchases more heavily
in the U.S. Agency sector.
We continue to avoid the higher-risk sectors of the
corporate market, such as financial companies and BBB-rated
companies. We enhance yield by replacing those sectors with
greater exposure to GNMA issues and callable agency issues,
thereby capturing higher yields without exposing the fund to
additional credit risk. We continue to believe that the Fund
is an outstanding choice for investors seeking a relatively
stable, fixed-income return, while avoiding the volatility
associated with interest rate speculation or aggressive
exposure to credit risk.
We appreciate your continued participation in the UMB Scout
Bond Fund as part of your investment portfolio. We welcome
your comments and questions.
Sincerely,
/s/George W. Root
George W. Root
UMB Investment Advisors
Shares of the UMB Scout Funds are not deposits or
obligations of, nor guaranteed by, UMB Bank, n.a. or any
other banking institution; nor are they insured by the
Federal Deposit Insurance Corporation ("FDIC") or any other
government agency. These shares involve investment risks,
including the possible loss of the principal invested.
CHART - HYPOTHETICAL GROWTH OF $10,000
CHART - COMPARATIVE RATES OF RETURN
UMB Scout Bond Fund (UMBBX)
as of December 31, 1999
1 Year 3 Years 5 Years 10 Years
UMB Scout Bond Fund 0.19% 4.81% 6.34% 6.41%
Lipper Intermed. Inv.
Grade Fund Index* -0.98% 4.99% 6.90% 6.97%
Lehman Bros.
Govt./Corp. Intermed.* 0.39% 5.50% 7.10% 7.26%
Performance data contained in this report are for past
periods only. Past performance is not indicative of future
results. Investment return and share value will fluctuate,
and redemption value may be more or less than original cost.
*Unmanaged index of stocks, bonds or mutual funds (there are
no direct investments or fees in these indices).
CHART - FUND DIVERSIFICATION
CHART - TAXABLE YIELD CURVES
CHART - HISTORICAL PER-SHARE RECORD
UMB Scout Bond Fund (UMBBX)
Income & Cumulative*
Net Short-Term Long-Term Value Per
Asset Gains Gains Share Plus
Value Distribution Distribution Distributions
12/31/82 $10.05 $0.03 $ - $10.08
12/31/83 9.59 0.94 - 10.56
12/31/84 10.37 0.45 - 11.79
12/31/85 10.94 0.98 0.02 13.36
12/31/86 11.37 0.83 0.03 14.64
12/31/87 10.42 1.25 0.01 14.95
12/31/88 10.19 0.81 0.03 15.56
12/31/89 10.50 0.82 - 16.69
12/31/90 10.54 0.79 - 17.52
12/31/91 11.19 0.71 - 18.88
12/31/92 11.20 0.71 - 19.60
12/31/93 11.44 0.64 0.04 20.52
12/31/94 10.46 0.63 - 20.17
12/31/95 11.26 0.63 0.01 21.60
12/31/96 11.02 0.62 - 21.99
12/31/97 11.17 0.63 - 22.76
12/31/98 11.33 0.62 - 23.54
12/31/99 10.74 0.61 - 23.56
*Does not assume any compounding of reinvested distributions.
Table shows calendar year distributions and net asset
values; may differ from fiscal year annual reports.
FINANCIAL STATEMENTS DECEMBER 31, 1999 (UNAUDITED)
Statement of Net Assets
<TABLE>
<CAPTION>
FACE MARKET
AMOUNT DESCRIPTION VALUE
</CAPTION>
<S> <C>
CORPORATE BONDS - 41.91%
$ 500,000 Alabama Power Company, 5.49%, due November 1, 2005 $ 456,725
1,000,000 Alabama Power Company, Sr. Note, 6.25%, due September 30, 2010 902,700
500,000 Atlantic Richfield Company, Note, 5.55%, due April 15, 2003 479,340
500,000 Albertson's Incorporated, Notes, 6.375%, due June 1, 2000 499,945
500,000 Amoco Canada Petroleum Co., Notes, 7.25%, due December 1, 2002 503,070
500,000 Baltimore Gas & Electric Company, 1st & Refunding Mortgage,
6.50%, due February 15, 2003 493,405
500,000 BellSouth Telecommunications Incorporated, Notes,
6.25%, due May 15, 2003 489,465
500,000 BellSouth Telecommunications Incorporated, Notes,
6.375%, due June 15, 2004 487,090
500,000 Carolina Power & Light Company, 1st Mortgage,
5.875%, due January 15, 2004 479,150
500,000 Consolidated Edison Company New York Incorporated, Debentures,
6.625%, due February 1, 2002 496,470
500,000 Cooper Industries Incorporated, Medium Term Notes,
5.88%, due February 20, 2003 482,780
1,000,000 Dillard Department Stores Incorporated, Notes,
6.875%, due June 1, 2005 941,220
500,000 Duke Power Company, 1st & Refunding Mortgage,
7.00%, due June 1, 2000 501,535
500,000 Duke Power Company, 1st & Refunding Mortgage,
5.875%, due June 1, 2001 494,025
500,000 duPont (E.I.)de Nemours & Company, Notes,
6.75%, due October 15, 2002 498,905
500,000 Emerson Electric Company, Notes, 6.30%, due November 1, 2005 477,905
500,000 Englehard Corporation, Senior Notes, 7.00%, due August 1, 2001 498,870
500,000 General Mills Incorporated, Medium Term Notes,
5.98%, due July 9, 2001 494,495
500,000 General Mills Incorporated, Medium Term Notes,
7.50%, due June 5, 2000 502,490
500,000 GTE California Incorporated, Debentures, Series A,
5.625%, due February 1, 2001 494,455
500,000 GTE Southwest Incorporated, Debentures,
6.00%, due January 15, 2006 469,120
500,000 GTE Southwest Incorporated, Debentures, 6.00%, due February 15, 2008 457,930
500,000 Honeywell Incorporated, Bond, 6.75%, due March 15, 2002 495,775
500,000 International Business Machines Corporation, Notes,
7.25%, due November 1, 2002 504,925
500,000 International Business Machines Corporation, Notes,
6.375%, due June 15, 2000 500,410
500,000 Kansas City Power & Light Company, Medium Term Notes,
6.50%, due January 2, 2001 499,560
1,000,000 May Department Stores Incorporated, 6.875%, due November 1, 2005 983,860
250,000 McDonald's Corporation, Series C, Medium Term Notes,
8.75%, due November 15, 2000 254,943
750,000 Monongahela Power Company, 1st Mortgage, 5.625%, due April 1, 2000 748,718
500,000 Monongahela Power Company, 1st Mortgage, 7.375%, due July 1, 2002 502,840
1,000,000 New York Telephone Company, Notes, 5.875%, due September 1, 2003 961,280
500,000 Newell Company, Medium Term Notes, 6.18%, due July 11, 2000 499,185
500,000 Northwest Natural Gas Company, Secured Medium Term Notes,
5.98%, due December 15, 2000 497,420
500,000 Oneok, Inc. 7.75%, due August 15, 2006 501,520
500,000 Pacific Bell Telephone Company, Notes, 7.25%, due July 1, 2002 503,350
500,000 Pacificorp, Notes, 5.65%, due November 1, 2006 442,895
500,000 Pacific Gas & Electric Company, 1st Mortgage,
6.25%, due March 1, 2004 485,685
1,000,000 Public Service Company of Oklahoma, Medium Term Notes,
6.02%, due March 1, 2001 991,180
500,000 Sara Lee Corporation, Series C, Medium Term Notes,
6.45%, due September 26, 2005 479,315
500,000 Southwestern Bell Telephone Company, Medium Term Notes,
6.125%, due March 12, 2001 497,095
500,000 Southwestern Bell Telephone Company, Medium Term Notes,
5.77%, due October 14, 2003 479,700
500,000 Stanley Works, Medium Term Notes, 5.75%, due March 1, 2004 472,920
500,000 Sysco Corporation, Notes, 7.00%, due May 1, 2006 490,195
500,000 Texaco Capital Incorporated, Medium Term Notes,
8.24%, due October 15, 2001 510,075
250,000 Texaco Capital Incorporated, Medium Term Notes,
5.70%, due December 1, 2008 219,070
1,000,000 Texas Instruments Incorporated, Unsecured Note,
6.125%, due February 1, 2006 922,800
500,000 Tribune Company, Medium Term Notes, 5.30%, due April 17, 2000 498,800
500,000 Tribune Company, Medium Term Notes, 5.75%, due September 15, 2003 475,835
500,000 Union Pacific Corporation, Notes, 7.875%, due February 15, 2002 506,535
500,000 Union Pacific Railroad Company Equipment Trust, Series Cl.,
7.01%, due June 1, 2004 489,700
500,000 Wisconsin Electric Power Company, 6.625%, due November 15, 2006 480,885
550,000 Xerox Corporation, Notes, 5.25%, due December 15, 2003 506,754
TOTAL CORPORATE BONDS - 41.91% 28,004,314
U.S. GOVERNMENTAL AGENCIES - 12.58%
7,361 Government National Mortgage Association, 9.00%, due July 15, 2001 7,458
34,496 Government National Mortgage Association, 8.00%, due February 20, 2002 34,667
15,828 Government National Mortgage Association, 8.50%, due February 20, 2002 15,951
12,479 Government National Mortgage Association, 8.00%, due January 15, 2004 12,677
77,453 Government National Mortgage Association, 9.50%, due April 15, 2005 81,312
108,874 Government National Mortgage Association, 9.75%, due May 15, 2005 114,299
36,452 Government National Mortgage Association, 9.00%, due October 20, 2005 37,494
54,059 Government National Mortgage Association, 7.50%, due February 15, 2006 54,431
39,266 Government National Mortgage Association, 7.50%, due March 15, 2006 39,536
54,597 Government National Mortgage Association, 8.00%, due June 20, 2006 55,203
64,912 Government National Mortgage Association, 8.50%, due July 15, 2006 66,544
33,800 Government National Mortgage Association, 8.00%, due August 15, 2006 34,476
112,042 Government National Mortgage Association, 8.00%, due August 15, 2006 114,284
128,244 Government National Mortgage Association, 7.50%, due August 20, 2006 128,910
85,676 Government National Mortgage Association, 7.50%, due September 15, 2006 86,264
50,232 Government National Mortgage Association, 7.50%, due April 15, 2007 50,534
103,913 Government National Mortgage Association, 7.50%, due March 20, 2009 104,427
265,255 Government National Mortgage Association, 6.00%, due May 15, 2009 254,819
199,487 Government National Mortgage Association, 7.00%, due May 15, 2009 197,428
373,124 Government National Mortgage Association, 6.00%, due April 15, 2011 354,348
317,923 Government National Mortgage Association, 7.00%, due August 20, 2011 313,615
319,575 Government National Mortgage Association, 6.50%, due October 15, 2011 310,652
259,400 Government National Mortgage Association, 7.00%, due October 20, 2011 255,885
362,347 Government National Mortgage Association, 6.50%, due February 15, 2012 352,230
335,494 Government National Mortgage Association, 7.00%, due April 20, 2012 330,774
429,101 Government National Mortgage Association, 6.50%, due September 20, 2012 414,885
320,093 Government National Mortgage Association, 6.50%, due October 20, 2012 309,488
378,682 Government National Mortgage Association, 6.00%, due February 20, 2013 358,207
424,719 Government National Mortgage Association, 6.00%, due March 20, 2013 401,755
448,859 Government National Mortgage Association, 6.00%, due August 15, 2013 425,433
425,491 Government National Mortgage Association, 6.00%, due August 20, 2013 402,089
458,169 Government National Mortgage Association, 6.00%, due December 20, 2013 432,970
458,223 Government National Mortgage Association, 6.00%, due January 20, 2014 433,021
473,072 Government National Mortgage Association, 6.00%, due February 15, 2014 448,383
467,070 Government National Mortgage Association, 6.00%, due February 20, 2014 441,381
486,629 Government National Mortgage Association, 6.00%, due May 15, 2014 461,232
476,036 Government National Mortgage Association, 7.00%, due June 15, 2014 471,124
TOTAL U.S. GOVERNMENTAL AGENCIES - 12.58% 8,408,183
U.S. GOVERNMENT SECURITIES - 5.27%
1,000,000 U.S. Treasury Notes, 7.50%, due November 15, 2001 1,021,720
1,000,000 U.S. Treasury Notes, 6.375%, due August 15, 2002 1,002,190
750,000 U.S. Treasury Notes, 6.25%, due February 15, 2003 747,773
250,000 U.S. Treasury Notes, 6.25%, due February 15, 2003 249,258
500,000 U.S. Treasury Notes, 6.375%, due August 15, 2002 501,095
TOTAL U.S. GOVERNMENT SECURITIES - 5.27% 3,522,035
GOVERNMENT SPONSORED ENTERPRISES - 39.52%
500,000 Federal Farm Credit Bank, Medium Term Note,
6.70%, due October 11, 2006 491,720
500,000 Federal Home Loan Banks, 6.31%, due March 29, 2001 498,515
500,000 Federal Home Loan Banks, 6.18%, due December 19, 2001 495,545
500,000 Federal Home Loan Banks, 5.125%, due February 26, 2002 485,705
500,000 Federal Home Loan Banks, 5.65%, due March 3, 2003 483,360
1,000,000 Federal Home Loan Banks, 5.28%, due December 10, 2003 945,620
1,000,000 Federal Home Loan Banks, 6.525%, due June 17, 2009 958,590
1,000,000 Federal Home Loan Mortgage Corporation, 6.05%, due March 12, 2003 973,120
1,000,000 Federal Home Loan Mortgage Corporation, 5.75%, due July 15, 2003 968,280
1,000,000 Federal Home Loan Mortgage Corporation, 6.75%, due May 30, 2006 986,720
500,000 Federal National Mortgage Association, 5.90%, due November 20, 2000 497,970
1,000,000 Federal National Mortgage Association, Series I, Deb.,
8.25%, due December 18, 2000 1,017,030
1,250,000 Federal National Mortgage Association, Deb.,
7.50%, due February 11, 2002 1,269,925
1,000,000 Federal National Mortgage Association, Series SM-E, Deb.,
7.55%, due April 22, 2002 1,018,280
500,000 Federal National Mortgage Association, Series K, Deb.,
7.05%, due November 12, 2002 504,530
500,000 Federal National Mortgage Association, Deb.,
6.80%, due January 10, 2003 501,485
419,476 Federal National Mortgage Association, 6.50%, due November 1, 2004 396,898
500,000 Federal National Mortgage Association, Medium Term Notes,
6.36%, due August 16, 2000 500,080
500,000 Federal National Mortgage Association, Medium Term Notes,
5.72%, due March 8, 2001 495,235
1,000,000 Federal National Mortgage Association, Medium Term Notes,
6.45%, due April 23, 2001 998,590
500,000 Federal National Mortgage Association, Medium Term Notes,
6.625%, due May 21, 2001 500,390
500,000 Federal National Mortgage Association, Medium Term Notes,
6.41%, due February 6, 2002 497,500
500,000 Federal National Mortgage Association, Medium Term Notes,
6.09%, due September 30, 2002 492,500
500,000 Federal National Mortgage Association, Medium Term Notes,
5.50%, due February 2, 2004 474,845
1,000,000 Federal National Mortgage Association, Medium Term Notes,
6.36%, due December 27, 2004 963,910
500,000 Federal National Mortgage Association, Medium Term Notes,
6.10%, due January 26, 2005 477,345
1,000,000 Federal National Mortgage Association, Medium Term Notes,
6.82%, due August 23, 2005 993,910
500,000 Federal National Mortgage Association, Medium Term Notes,
5.875%, due February 14, 2006 472,110
1,500,000 Federal National Mortgage Association, Medium Term Notes,
6.41%, due March 8, 2006 1,455,240
500,000 Federal National Mortgage Association, Medium Term Notes,
6.96%, due April 2, 2007 496,330
500,000 Federal National Mortgage Association, Medium Term Notes,
6.70%, due June 19, 2007 488,045
500,000 Federal National Mortgage Association, Medium Term Notes,
6.38%, due February 20, 2008 466,640
2,000,000 Federal National Mortgage Association, Medium Term Notes,
6.00%, due September 29, 2008 1,819,380
1,000,000 Federal National Mortgage Association, Medium Term Notes,
6.01%, due November 13, 2008 909,060
1,000,000 Federal National Mortgage Association, Medium Term Notes,
7.15%, due June 11, 2009 952,500
500,000 Federal National Mortgage Association, Medium Term Notes,
6.11%, due December 4, 2008 456,640
TOTAL GOVERNMENT SPONSORED ENTERPRISES - 39.52% 26,403,543
REPURCHASE AGREEMENT - 0.22%
145,000 Northern Trust Co., 3.50%, due January 3, 2000
(Collateralized by U.S. Treasury Notes,
5.375%, due July 31, 2000) 145,000
TOTAL INVESTMENTS - 99.51% 66,483,075
Other assets less liabilities - 0.49% 330,131
TOTAL NET ASSETS - 100.00%
(equivalent to $10.74 per share; 10,000,000 shares of $1.00 par value
capital shares authorized; 6,220,316.338 shares outstanding) $ 66,813,206
</TABLE>
See accompanying Notes to Financial Statements.
FINANCIAL STATEMENTS DECEMBER 31, 1999 (UNAUDITED)
STATEMENT OF ASSETS AND LIABILITIES
ASSETS:
Investment securities, at market value
(identified cost $67,877,251) $66,483,075
Interest receivable 947,979
Cash (642,853)
Total assets 66,788,201
LIABILITIES:
Income payable 224
Accrued management expense (25,229)
Total liabilities (25,005)
NET ASSETS $66,813,206
NET ASSETS CONSIST OF:
Capital (capital stock and paid-in capital) $67,883,190
Accumulated undistributed income:
Net investment income 448,731
Net realized gain (loss) on investment
transactions 5,107
Net unrealized depreciation on investments (1,523,822)
NET ASSETS APPLICABLE TO OUTSTANDING SHARES $66,813,206
Capital shares, $1.00 par value
Authorized 10,000,000
Outstanding 6,220,316
NET ASSET VALUE PER SHARE $ 10.74
See accompanying Notes to Financial Statements.
FINANCIAL STATEMENTS SIX MONTHS ENDED DECEMBER 31, 1999 (UNAUDITED)
STATEMENT OF OPERATIONS
INVESTMENT INCOME:
Income:
Interest $ 2,290,257
Expenses:
Management fees 299,988
Government fees 4,337
304,325
Net investment income 1,985,932
REALIZED and unrealized gain (LOSS) ON INVESTMENTS:
Net realized gain (loss) from investment
transactions (1,341)
Decrease in net unrealized appreciation
(depreciation) on investments (1,363,681)
Net realized and unrealized gain (loss)
on investments (1,365,022)
Net increase (decrease) in net assets
resulting from operations $ 620,910
See accompanying Notes to Financial Statements.
FINANCIAL STATEMENTS
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
SIX MONTHS ENDED
DECEMBER 31, 1999 YEAR ENDED
(UNAUDITED) JUNE 30, 1999
</CAPTION>
<S> <C> <C>
INCREASE IN NET ASSETS FROM OPERATIONS:
Net investment income $ 1,985,932 $ 4,238,356
Net realized gain (loss) from investment
transactions (1,341) 56,682
Increase (decrease) in net unrealized
appreciation on investments (1,363,681) (1,809,607)
Net increase (decrease) in net assets
resulting from operations 620,910 2,485,431
DISTRIBUTIONS TO SHAREHOLDERS FROM:*
Net investment income (1,985,932) (4,238,356)
DECREASE FROM CAPITAL SHARE TRANSACTIONS:
Proceeds from 504,447 and 1,622,279 shares sold 5,479,522 18,682,363
Net asset value of 45,601 and 94,852 shares
issued for reinvestment of distributions 493,859 1,062,771
5,973,381 19,745,134
Cost of 928,710 and 2,092,454 shares redeemed (10,075,128) (23,416,507)
Net increase (decrease) in net assets
from capital share transactions (4,101,747) (3,671,373)
Net increase (decrease) in net assets (5,466,769) (5,424,298)
NET ASSETS:
Beginning of period 72,279,975 77,704,273
End of period (including undistributed
net investment income of $448,731 in 1999) $ 66,813,206 $ 72,279,975
*Distributions to shareholders:
Income dividends per share $ 0.31 $ 0.62
</TABLE>
See accompanying Notes to Financial Statements.
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES - The Fund is registered under the Investment
Company Act of 1940, as amended, as a diversified, open-end
management investment company. The following is a summary of
significant accounting policies consistently followed by the
Fund in the preparation of its financial statements. The
policies are in conformity with generally accepted accounting principles.
Investments - Debt securities (other than short-term
obligations), including listed issues, are valued at market
on the basis of valuations furnished by an independent
pricing service which utilizes both dealer-supplied
valuations and formula-based techniques. Short-term
obligations are valued at amortized cost, which approximates
market value. Investment transactions are recorded on the
trade date. Investment income is recorded daily and
distributions to shareholders are recorded on the ex-
dividend dates. Realized gains and losses from investment
transactions and unrealized appreciation and depreciation of
investments are reported on the identified cost basis.
Federal Income Taxes - The Fund's policy is to comply with
the requirements of the Internal Revenue Code that are
applicable to regulated investment companies and to
distribute all of its taxable income to its shareholders.
Therefore, no federal income tax provision is required.
Amortization - Discounts and premiums on securities
purchased are amortized over the life of the respective securities.
Estimates - The preparation of financial statements, in
conformity with generally accepted accounting principles,
requires management to make estimates and assumptions that
affect the reported amount of assets and liabilities and
disclosure of contingent 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.
2. PURCHASES AND SALES OF SECURITIES - The aggregate amounts
of security transactions during the six months ended
December 31, 1999 (excluding commercial paper and repurchase
agreements), were as follows:
Other than
U.S. Government U.S. Government
Securities Securities
Purchases $ 494,600 $ 1,513,223
Proceeds from sales 2,507,329 3,645,110
3. MANAGEMENT FEES - UMB Bank, n.a. is the Fund's manager
and investment advisor and provides or pays the cost of all
management, supervisory and administrative services required
in the normal operation of the Fund. This includes
investment management; fees of the custodian, independent
public accountants and legal counsel; remuneration of
officers and directors; rent; and shareholder services,
including maintenance of the shareholder accounting system
and transfer agency. Not considered normal operating
expenses and therefore payable by the Fund are taxes,
interest, fees and the other charges of governments and
their agencies for qualifying the fund's shares for sale,
special accounting and legal fees and brokerage commissions.
UMB Bank's management fees are based on average daily net
assets of the Fund at the annual rate of .85 of one percent
of net assets. Certain officers and/or directors of the Fund
are also officers and/or directors of Jones & Babson, Inc.,
which serves as the Fund's underwriter and distributor.
4. REPURCHASE AGREEMENTS - Securities purchased under
agreements to resell are held by the Fund's custodian and
investment counsel, UMB Bank, n.a. The custodian monitors
the market values of the underlying securities which they
have purchased on behalf of the Fund to ensure that the
collateral is sufficient to protect the Fund in the event of
default by the seller.
This report has been prepared for the information of the
Shareholders of UMB Scout Bond Fund, Inc., and is not to be
construed as an offering of the shares of the Fund. Shares
of this Fund, and of the other UMB Scout Funds, are offered
only by the Prospectus, a copy of which may be obtained from
Jones & Babson, Inc.
UMB Scout Funds
100% No-Load Mutual Funds
Stock Fund
Stock Select Fund
Regional Fund
WorldWide Fund
WorldWide Select Fund
Capital Preservation Fund
Balanced Fund
Bond Fund
Kansas Tax-Exempt Bond Fund*
Money Market Fund
Federal Portfolio
Prime Portfolio
Tax-Free Money Market Fund
*Available in Kansas and Missouri only.
INVESTMENT ADVISORS AND MANAGER
UMB Bank, n.a., Kansas City, Missouri
AUDITORS
Baird, Kurtz & Dobson, Kansas City, Missouri
Legal Counsel
Stradley, Ronon, Stevens & Young, LLP
Philadelphia, Pennsylvania
CUSTODIAN
UMB Bank, n.a., Kansas City, Missouri
UNDERWRITER, DISTRIBUTOR
AND TRANSFER AGENT
Jones & Babson, Inc., Kansas City, Missouri
UMB SCOUT FUNDS
P.O. Box 219757
Kansas City, MO 64121-9757
Toll Free 800-996-2862
www.umb.com
"UMB", "Scout" and the "Scout" design are registered
service marks of UMB Financial Corporation.
