1997 annual report
$500,000,000 [encircled]
[Citizens logo]CITIZENS
TRUST
More than half-a-billion dollars
in socially responsible investments.
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"Money is sharper than a sword."
-Ashanti (West African) proverb
Performance data quoted represents past performance which does not guarantee
future results. Investment return and principal value in the Citizens Trust
Portfolios will fluctuate so that shares, when redeemed, may be worth more or
less than the original cost.
Please read our fund prospectus carefully, which includes complete details on
fees and expenses, before you invest or send money. Should you need an
additional prospectus, please call 800-223-7010.
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Citizens Trust
Dear Shareholders:
[photo of
Sophia Collier] I am pleased to report that the Fund as a whole has surpassed
$500 million in assets, with our flagship portfolio, Citizens
Index Portfolio, accounting for approximately one-half of this
total. Our focus on achieving strong financial results through
investing in socially responsible companies was well rewarded
in fiscal 1997, with all the Fund's portfolios attaining
positive returns for the one year ended 6/30/97. (Full details
of each portfolio's performance are provided later in this
report.)
As long-time shareholders know, one of my personal measures of our
success is how well our own Citizens Index Portfolio performs vs. the
enormous Vanguard Index 500. I compare us to Vanguard because it is the
nation's largest index fund. Like us, it is in the growth and income
category. Its enormous size gives it a running start with a super-low expense
ratio (.20 vs. 1.59 for the Citizens Index Portfolio). Yet, once again, we
were able to beat Vanguard and deliver a higher total return to those sharehol
ders who chose our socially responsible option.
For the one year ended 7/31/97, our Citizens Index Portfolio (Retail
class) had a total return of 56.4%, while Vanguard, as reported in the Wall
Street Journal, had a total return of 52.0%. For the year ended 6/30/97, the
numbers were Citizens: 35.9%; Vanguard: 34.6%; and since our inception on
3/3/95, Citizens Index Portfolio had an average annual return of 29.8% vs.
Vanguard Index 500's average annual return since its inception (8/1/76) of
14.9%. The "since inception" numbers are not a meaningful basis of comparison
for these two portfolios, because Vanguard has operated through many market
cycles and the Citizens Index Portfolio has been in just one. However, it is
interesting to look at Vanguard's numbers because it is a portfolio that
began at the end of the Nixon era and has continued to be fully invested
until today. If Citizens Index is able to create results like this over the
long term (or perhaps a little better!), I will be very happy with our
achievement. We are currently enjoying a very strong period in the stock
market that cannot continue forever. Bad years inevitably follow good years,
but good years return again.
So, in times like this, it is reassuring to remember that careful social
research is the foundation for every investment we make. In soaring stock
markets, even a portfolio chosen with darts can be a winner; but this is not
always true. Through social research, we try to avoid companies with poor
records and invest only in the most promising. Over time, we believe this is
a systematic advantage.
Another area where we have made significant progress in 1997 has been in
our operations area. Our call center is now routinely answering 80% of its
calls within 20 seconds or less. As we grow larger, we have been able to
invest in new technology, training and improved systems that we believe will
continue to result in further improvements.
When we passed the $500 million mark, we had many friends call to
congratulate us and ask when will we get to $1 billion in assets. Soon, we
hope - but not because we value growth for its own sake. Our first priority
is always to serve you, our existing shareholders - to help you achieve your
goals of strong financial performance by investing in companies operated in a
manner consistent with your values.
/s/ Sophia Collier
Sophia Collier
President
August 11, 1997
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1997 Annual Report
Manager's Comments
A New Way Of Doing Business?
In the first six months of 1997, the U.S. equity market has continued the growth
of 1996 by rising more than 20%. While the first quarter of 1997 "only" returned
2.61% - which, on an annualized basis, almost exactly matches the 10.5% average
annual equity return since 1926 - April through June posted S&P 500 returns of
over 19%. The 12-month S&P 500 return ending June 30, 1997 was a robust 34.6%.
Our own Citizens Index returned 38.7% for the same period.
How long and how high can this economic expansion go? That's the question
investors are asking after another year of economic growth. The economy
expanded by an astonishing 5.8% pace in the first quarter of 1997 - the
fastest in nearly a decade - and drove the unemployment rate down to a
24-year low of 4.8%. As socially responsible investors, it is heartening to
see low unemployment co-existing with strong economic growth. Past investment
opinion has held that unemployment at too low a level can actually hurt the
economy by stalling business productivity; as fewer workers become available
to make more products, productivity falls and the economy slows down. The
strength of the economy suggests there is a new breed of smart company out
there, finding ways to maximize their productivity by building positive work
environments, producing products its workers can be proud of and respecting
the environment in which we all must live. These companies are a driving
force in the current economic expansion, and we think they're building a new
business paradigm for the next century.
Undoubtedly, the ups and downs of the economic cycle will continue. By
post-war economic standards, this economic expansion is already considered
mature, prompting the pessimistic "Bears" to ask their favorite question, "Is
it time for a recession?" But looking further into the data, no pressing
evidence for an impending recession exists at this moment in time. Inflation
is very low. Of six expansions in the past 40 years, this current expansion
is only the third longest and the one with the slowest rate of growth
measured across its entire duration. Economic expansions tend to falter
because of excesses in the marketplace. As the slowest of the economic
expansions by a significant factor, today's expansion demonstrates a good
case for continued growth.
In theory, an economic expansion can continue for an unlimited period of
time, provided it does not overheat the economy. In practice, however, all
expansions have eventually ended. By keeping this cyclical nature of the
markets in mind, investors can benefit the most from good times by saving
profits to carry them through the flat or down years.
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1997 Annual Report Citizens Trust
Manager's Comments
Manager's Comments
Annual Recap/Citizens Index Portfolio As readers of our
prospectus know, the investment strategy of the Citizens [photo of Edwin Ek]
Index Portfolio is to stay as closely invested in the Edwin Ek
Citizens Index as possible. This was a rewarding strategy a member of the
in the fiscal year ending June 30, 1997. The Citizens Citizens Index
Index Portfolio retail class share's average annual return Portfolio manage-
since inception (3/3/95) was 29.8% as of June 30, 1997, ment team.
and its one-year total return was 35.9%. The Index
Portfolio retail class shares did so well, in fact, that
among the 128 index funds tracked by Morningstar Inc., the
Citizens Index Portfolio was ranked #6 in total return for
the year ending June 30, 1997.
Citizens Index Portfolio (Retail Class)
Standardized total return since inception
Citizens Index Portfolio
(Retail Class) S&P 500 Citizens Index
$10,000 $10,000 $10,000
1995 10,940 1995 11,318 1995 11,469
1996 13,501 1996 14,260 1996 14,447
1997 18,347 1997 19,209 1997 20,079
Past performance does not guarantee future results. Standardized total return
for the period ending 6/30/97: one year 35.88%; since inception 29.77%.
Portfolio commenced operations on March 3, 1995.
The portfolio's institutional class shares were ranked #2 in the same
category. Institutional class shares are available for an investment of
$100,000 and are used by many non-profit organizations and church groups.
The bottom line was improved for all Index Portfolio shareholders this
fiscal year, as the Fund's Adviser announced that the expense ratio for the
portfolio had dropped by 23 basis points over the year. The Adviser has
planned an intensive effort to do even more in the coming year.
3
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1997 Annual Report
Manager's Comments
Portfolio:
Citizens Index
Objective:
Capital Appreciation
The Ground Rules: Invests up to 100% of assets at all times in the 300
companies that comprise the Citizens Index, in a fixed proportion equal to
the market weight of each company.
The Results:
Total return for the year ending 6/30/97 was 35.88% with an average annual
return since inception (3/3/95) of 29.77%. The institutional class shares had
a total return for the year ending 6/30/97 of 36.93%, with an average annual
return since inception (1/25/96) of 33.16%. The S&P 500 returned 34.57% for
the one-year period ending 6/30/97.
Last fiscal year was a very good one for the Citizens Index. The Citizens
Index returned an impressive 38.7% versus 34.5% for the S&P 500*. Representative
of the winners for the 12-month period were:
Dell Computer (+361%) - (Round Rock, Texas) designs and manufactures a variety
of computer systems. Within the last 12 months, the company reported daily sales
of more than $2 million in computers and related products via the Internet.
Spx Corp (+167%) - (Muskegon, Michigan) supplies tools and equipment to auto
dealers around the globe; it also produces the Chilton car repair manuals. SPX
has posted a 70% improvement in earnings per share since the beginning of the
year and has adapted a new financial strategy; buying back stock and bond
issues, as well as selling some of its divisions. The company believes the new
strategy will help them move ahead in their plans for increased worldwide
growth. SPX is not a holding in the S&P 500 Index, so it made a nice
contribution to the Citizens Index over the last 12 months.
Microsoft Corporation (+110%) - (Redmond, Washington) is a leading provider
of electronic software products, which include "Microsoft Windows" and
"Microsoft Excel". Technology stocks as a group have been one of the reasons
the Citizens Index has outperformed the S&P 500, and Microsoft contributed
significantly to this sector.
A couple of holdings in the Citizens Index which suffered negative returns
for the period were also among our smallest holdings. Idexx Laboratories, Inc.
(-68.31%) - (Westbrook, Maine) develops and manufactures veterinary test kits
used in animal health and feed-quality applications. The company suffered from
slower-than-expected sales, which caused high levels of costly inventory
buildup. Global Village Communications (-63.64%) - (Sunnyvale, California) which
develops and markets modems for personal compute rs. Shares fell significantly
after they announced a $30 million restructuring plan and lower-than-expected
sales, largely because of weak demand for Apple Computers (most of Global's
modem products are used with Apple computers).
*The Citizens Index and the S&P 500 are unmanaged indices generally
representative of common stock performance. Direct investments cannot be
made in these indices. To make an actual investment in the Citizens Index
Portfolio will involve fees, which are reported later in this document, but
are not reflected in the performance of the Citizens Index.
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Citizens Trust
Looking ahead, the performance of the Citizens Index Portfolio should be
similar to that of the large capitalization equity market as a whole. For the
long-term investor, this has always been the appeal of an index fund.
Tracking the economy through the domestic equity market has paid off for
investors over time, especially when compared to the performance of more
actively managed funds that try to "time" the swings in the market.
Additionally, because the Citizens Index Portfolio is fully invested in the
equity market (through its mirroring of the Citizens Index and its 300
companies), the composition of the portfolio, in part, is determined by our
social screens. The effect of these screens on the portfolio's performance
might be understood best by comparing the return of the Citizens Index vs.
the return of the S&P 500 over the same time period.
Citizens Index Portfolio (Institutional Class)
Standardized total return since inception
Citizens Index Portfolio
(Institutional Class) S&P 500 Citizens Index
$10,000 $10,000 $10,000
1996 11,000 1996 10,898 1996 11,141
1997 15,051 1997 14,680 1997 15,451
Past performance does not guarantee future results. Standardized total return
for the period ended 6/30/97: one year 36.93%; since inception 33.16%. Portfolio
commenced operations on January 25, 1996.
5
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1997 Annual Report
Manager's Comments
[photo] Annual Recap/Citizens Emerging Growth Portfolio
Over the last year, investors continued to favor the very
Richard Little, largest capitalization equities at the expense of
a member of the smaller, rapidly growing companies. The one-year return
Citizens Emerging of the S&P 500 through 6/30/97 was 34.7%. The Citizens
Growth Portfolio Emerging Growth Portfolio returned 4.03% during this
management team. period. Investor preference for large-cap stocks now
may be reaching a peak. By fiscal year end, small
company stocks had begun to outperform as strong
fundamentals and now reasonable valuations are finally
attracting investors. We had forecast this to occur in
the semi-annual report, and it appears that our
forecast is coming to fruition.
Among the major contributors to the portfolio's return over the last 12
months was Altera Corp., the dominant company in high-density programmable
logic devices (PLDs). Last fall, we purchased the stock for $25; as of
6/30/97, the stock traded at $50. We continue to hold Altera because demand
for their products from the communications and the broad-based computer
market is robust.
Citizens Emerging Growth Portfolio -
Standardized total return since inception
Citizens Emerging Growth Portfolio Russell 2000 Index
$10,000 $10,000
1994 9,300 1994 9,123
1995 12,238 1995 10,768
1996 17,430 1996 13,353
1997 18,133 1997 15,517
Past performance does not guarantee future results. Standardized total return
for the period ended 6/30/97: one year 4.03%; since inception 19.18%. Portfolio
commenced operations on February 8, 1994.
Another winner was CMAC Investment Corp., a leading mortgage insurer with an
emphasis on the California market. We initiated a position in early 1997 at $32;
the stock had risen nearly 50% by 6/30/97. We
6
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Citizens Trust
continue to hold our position but have sold some stock to lock in gains.
We initiated a position in Cienna, a leading supplier of wavelength
multiplexing for fiberoptic telecom carriers, in mid-April at $27 5/8. Shortly
thereafter, the market realized, as we had earlier, the company's outstanding
fundamental prospects and moved the stock swiftly to the mid $40's. We sold our
position and realized a 55% return in less than one month.
The portfolio had its share of disappointments, also, largely due to the
very negative psychology surrounding small-company investing over the last 12
months. Rather than suffer with dwindling stock prices, we sold some stocks at
losses, when real or potential business problems appeared. Dataworks, purchased
in late 1996, produced strong first-quarter 1997 results ahead of expectations.
But unexpected balance sheet problems tainted future prospects. Corporate
Express, which had been a long-term holding for our portfolio and historically
had performed well, encountered business integration issues with a recent
acquisition. This soon would equate to lower than expected earnings, so we sold
the stock.
Looking forward, the fundamentals for investment in mid-to-smaller
capitalization companies are compelling. Relative valuations of smaller stocks
vs. large capitalization stocks are extremely favorable. Many large companies
now trade at valuations more than twice their actual growth rate, while smaller
companies are far more reasonably priced. An impending capital gains tax cut
also should focus investor attention on smaller stocks. Investor sentiment could
turn quickly, and small stocks again could enjoy the favor in which they were
regarded just 18 months ago. Such a turn in sentiment would be ideal for
emerging growth investors, but we won't rely on predictions of market
psychology. Instead, we will continue to adhere strictly to our investment
disciplines. Our strategy focuses on company fundamentals, the solid
underpinnings of success. Companies which are demonstrating strong business
momentum and which continue to win within their markets are our investment
candidates. To remain in our portfolio, companies must consistently meet these
criteria.
Annual Recap/Citizens Global Equity Portfolio
Economic conditions during the last 12 months were mostly positive for global
financial markets. Moderate growth and modest inflation in the G-7 countries
Portfolio:
Citizens Emerging Growth
Objective:
Aggressive Growth
The Ground Rules:
Invests in the common stock of U.S. domestic companies with an average
capitalization of $2 billion; can invest in cash in times of market volatility
or projected downturns.
The Results:
Total return for the year ending 6/30/97 was 4.03% with an average annual
return since inception (2/8/94) of 19.18%. The Russell 2000 small-cap index
returned 16.34% for the one-year period ending 6/30/97.
7
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1997 Annual Report
Manager's Comments
[photo] prompted central banks to keep interest rates at record
Lilia Clemente, low levels. This, in turn, contributed to a pickup in
a member of the global economic growth. Tightening U.S. labor markets
Citizens Global and rising oil prices increased investor anxieties that
Equity Portfolio higher inflation might prompt the Fed to tighten
management team. credit, but U.S. economic growth slowed during the
summer, dampening inflation concerns. Global interest
rates declined, and economies strengthened.
The Citizens Global Equity Portfolio returned 21.70% for the 12-month
period ended June 30, 1997, outpacing its benchmark index, the unmanaged
Financial Times World Index, which rose 19.38% for the same period. The
Global Equity's strong performance placed the portfolio in the top tier of
all global funds tracked by Lipper Analytical Services, for year to date
total return ending 6/30/97, with a rank of 14th out of 202 global funds.
Since its inception in February 1994, the portfolio had an average annual
return of 12.11% per year.
Citizens Global Equity Portfolio
Standardized total return since inception
Citizens Global Equity Portfolio FT World Index (US Dollars)
$10,000 $10,000
1994 9,800 1994 9,911
1995 10,757 1995 10,589
1996 12,104 1996 12,267
1997 14,731 1997 14,645
Past performance does not guarantee future results. Standardized total return
for the period ended 6/30/97: one year 21.70%; since inception 12.11%.
Portfolio commenced operations on February 8, 1994.
In the past 12 months, we continued to favor European countries based on
the expectation of improving economies, falling inflation and monetary
easing. Latin America was another one of our favorites, with our largest
holdings located in Brazil and Mexico. Economic recovery, structural reforms,
declining inflation and lower interest rates laid out the perfect setting for
strong performance. On the other hand, we reduced substantially our positions
in Asia, except Japan. Balance of payment problems, currency crisis in
8
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Citizens Trust
Thailand and the strong dollar were major negatives for those markets. The worst
performing markets in the past 12 months were all Asian: Thailand, -54%; the
Philippines, -22% and Korea, -17.5%. We maintained our slightly underweight
position in Japan with a focus on multinational companies within Japan that
would benefit from the weaker yen. The United States also remained underweight.
The high level of market valuations, the fear of rising interest rates and the
continued strength of the U.S. dollar were the main elements behind our
rationale.
Our stock selection remained centered around four basic themes: high
technology, business services (including telecommunications), health care and
financial services.
Among the major contributors to the portfolio's return over the last 12
months was, for the second year running, Tomra Systems +127%, a Norwegian
company that specializes in beverage containers recycling machinery. Due to its
strong technological innovation, Tomra is the market leader with an 80% global
share. The company has been the main beneficiary of new regulations regarding
recycling in both the U.S. and Europe, and is now expanding into Asia. Since
inclusion in the portfolio in January 1995, the stock price has increased by
more than 800%. Another winner is Banco Santander, whose share price has risen
126% over the past year. Santander is the premier banking and financial services
provider in Spain, with strong international presence in Latin America. Another
of our top performers, Telebras, is also a familiar name in Global Equity
Portfolio. Telebras is the leading telecommunications company of Brazil, a
country that has one of the lowest telephone penetration rates in the world.
Telebras returned 118%.
Though the portfolio's overall result was extremely strong, some positions
hurt our return. The Philippines, which always has been one of our favorite
Southeast Asian countries due to its on-going drive for economic and political
reforms coupled with a very dynamic private sector, was badly hit due to fear of
spillover from Thailand's financial crisis. Our two holdings in the Philippines
were down by about 20%.
The Global Equity Portfolio will continue to favor European markets where
the fund has a 38% weighting. The current economic recovery, stable due to
falling inflation, low interest rates and corporate restructuring drives all are
reasons why we remain optimistic about Europe. In addition, widespread
Portfolio:
Citizens Global Equity Portfolio
Objective:
Capital Appreciation
The Ground Rules:
Can invest anywhere in the world, provided it holds at least 50% non-U.S.
companies and a minimum of three countries. To reduce risk, cannot invest more
than 25% in emerging markets.
The Results:
Total return for the year ending 6/30/97 was 21.70% with an average annual
return since inception (2/8/94) of 12.11%. The Financial Times World Index
returned 19.38% for the one-year period ending 6/30/97.
9
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1997 Annual Report
Manager's Comments
[photo] reform of pension systems will profoundly affect the
way in which Europeans invest. In Japan, where we
Gail Seneca, expect to keep the same weighting, we continue to focus
a member of the on Japanese companies that are beneficiaries of a
Citizens Income weaker yen. Emerging markets have benefited as
Portfolio manage- investors moved in, looking for value on the back of a
ment team. poor performance in 1995. The most attractive region
continues to be Latin America, with Brazil, Mexico and
Venezuela offering the best investment opportunities. A
favorable inflation outlook as well as ongoing
political and economic reform should support these
markets. Mexico remains our favorite among the big four
Latin American markets for the second half of 1997. We
are increasing our holdings in the U.S. by cutting down
our cash, but we will remain underweight due to the
fact that valuations appear to be stretched and the
market seems some-what overextended.
Annual Recap/Citizens Income Portfolio
To the casual observer, the bond market might have appeared as though it were
quite stable over the 12 months ending June 30, 1997. The benchmark 30-year
Treasury Bond yielded 6.87% at the end of June 1996, and 6.78% at the end of
June 1997. In fact, interest rates were quite volatile over the course of the
year, fluctuating between 6.35% and 7.25%. It is important to remember that bond
prices fall with an increase in interest rates, and fluctuations of a single
basis point can change the value of a $1,000 bond by more than a dollar. A move
from 6.35% to 7.25% could change the value of the same bond by as much as $120.
These wide swings in interest rates mirrored shifts in investor concerns
over Federal Reserve policy. Whenever Fed Chairman Greenspan threatened to raise
interest rates, and finally did so last March, uneasy bond investors sold to
avoid holding bonds whose value would be diminished in a higher interest rate
environment. But when the Fed seemed unlikely to raise the interest rate, the
bond market rallied. Chairman Greenspan's attempts to collar the runaway stock
market with verbal warnings, and finally action, led to a bumpy ride for the
bond market as a whole. During this volatile year, the Citizens Income Portfolio
kept to its strategy of emphasizing high current income while maintaining a
conservative intermediate term. While the broad bond market (as measured by the
Lehman Brothers Corporate/Government Bond Index) returned 7.75% over the year
ending June 30, 1997, the
10
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Citizens Trust
conservative strategy of the Citizens Income Portfolio posted a strong 9.57%
return over the same period. During the past year, our strongest returns were
from corporate bond holdings. Top performers included Cobb Theaters, Tyco Toys,
J.Q. Hammons Hotels and Smith's Food and Drug. Mortgage-backed securities issued
by FHLMC, FNMA and GNMA also contributed to our strong performance during the
year and will continue to be an important part of the portfolio.
Citizens Income Portfolio -
Standardized total return since inception
Citizens Income Fund Lehman Government/Corporate Intermediate
$10,000 $10,000
1992 10,080 1992 10,124
1993 11,096 1993 11,187
1994 11,101 1994 11,159
1995 12,261 1995 12,316
1996 12,932 1996 12,933
1997 14,169 1997 13,867
Past performance does not guarantee future results. Standardized total return
for the period ended 6/30/97: one year 9.57%; since inception 7.12%. Portfolio
commenced operations on June 30, 1992.
In our semi-annual report at the end of 1996, we predicted the long (30-Year
Treasury Bond) rates would fluctuate in the 6.00% to 7.25% range in 1997, and we
continue to support this view for the coming 12 months. If the inflation rate
remains below 3% in the U.S., and we think it will, the market should perform at
least as well as it did over the prior 12 months. This means real or
inflation-adjusted returns from bonds should remain attractive for both domestic
and non-U.S. investors. Throughout the next year, we will continue to focus on
providing above-market returns through our disciplined, low-risk strategy that
proved so successful in the past year.
Portfolio:
Citizens Income Portfolio
Objective: High Current Income
The Ground Rules:
Invests at least 65% of its assets in taxable bonds rated as "investment grade".
The Results:
Total return for the year ending 6/30/97 was 9.57% with an average annual return
since inception (6/10/92) of 7.12%. The average annual return for the five-year
period ending 6/30/97 was 7.03%. The Lehman Brothers Corporate/Government Bond
Index returned 7.75% for the one-year period ending 6/30/97.
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1997 Annual Report
Manager's Commments
Portfolio:
Muir California Tax-Free Income
Portfolio Manager:
Team Objective:
Current income exempt from California State and Federal Taxes.
The Ground Rules:
Invests up to 100% in California municipal securities.
The Results:
One year total return for the year ending 6/30/97 was 6.55% with an average
annual return since inception (6/10/91) of 6.27%. The average annual return for
the five-year period ending 6/30/97 was 5.21%. The Lehman 7 Year Index returned
7.05% for the 12 months ended June 30, 1997. At 6/30/97, the current
distribution rate for the Portfolio was 3.84%, which translates into a tax
equivalent yield of more than 7% for California taxpayers.
Reorganization Of The Muir California Tax-Free Income Portfolio
The Citizens Trust Board of Trustees has recommended a reorganization of the
Muir Portfolio requiring a proxy vote. The trustees have considered the issues
inherent in the small size of the Muir and have concluded that, by combining the
Muir Portfolio into the larger Income Portfolio, assets could be more
efficiently managed, expenses reduced and rate of return increased without
increased risk.
Although Muir Portfolio shareholders no longer will hold tax free securities
after the reorganization is completed, they still will be invested in a
fixed-income portfolio with a mandate to provide "current income and pay a
dividend every month." In the opinion of the Trustees, any tax consequences are
outweighed by the likelihood of lower expenses and the possibility of higher
returns flowing to Muir Portfolio shareholders once they become shareholders of
the Citizens Income Portfolio.
Please see the Portfolio Manager's report for the Citizens Income Portfolio
for more information on the investment objectives and past performance of the
Income Portfolio.
Annual Recap/Muir California Tax-Free Portfolio
Like other fixed-income portfolios, the Muir California Tax-Free has ridden the
bumpy road provided by the volatile bond market of the last year. Long-term
municipal bond rates fluctuated between 5.38% and 5.77% over the last 12 months
- - a dramatic variance in a market that reevaluates the value of a bond on the
move of just a few basis points.
An excellent supply-demand situation led us to lengthen duration in the
portfolio in 1997 to an average of 8.8 years. While this was about one year
longer than our normal posture, it remained comfortably within an intermediate,
and therefore conservative, duration range, which was our mandate.
A potential new pitfall developed in the municipal market over the last
year. As more individuals have become subject to the "Alternative Minimum Tax"
(due mostly to the large amount of investment income in their overall income
mix), Private Activity Municipal Bonds, or municipal bonds that are subject to
AMT, became less popular and saw their value drop. Though these bonds constitute
a small portion of the portfolio (16.3%), they did detract from overall
performance.
$16,000
15,000
13,000
12,000
11,000
10,000
9,000
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Citizens Trust
Muir California Tax-Free Income Portfolio -
Standardized total return since inception
Muir California Tax-Free Lehman 7 Year
Income Portfolio Municipal Index
$10,000 $10,000
1992 10,800 1992 10,760
1993 12,159 1993 12,007
1994 12,164 1994 12,366
1994b 12,311 1994b 12,497
1995 12,945 1995 13,393
1996 13,554 1996 14,135
1997 14,442 1997 15,132
Past performance does not guarantee future results. Standardized total return
for the period ended 6/30/97: one year 6.55%; since inception 6.27%. Portfolio
commenced operations on June 10, 1991.
Annual Recap/E[bullet]fund(R) and Working Assets Money Market Portfolios
An economy that refused to quit prompted the Fed to raise short-term rates for
the first time in two-and-a-half years in March 1997. Typically, the Federal
Reserve moves more than once. Consequently, since the March increase, the
short-term market has been poised for even higher rates.
In this volatile market, the Citizens Trust Money Market Portfolios have
been rewarded for keeping maturities very short, thus being able to take
advantage of rising rates. For the seven days ending 6/30/97, the Working Assets
Money Market Fund has had an average maturity of 22 days and an effective yield
of 4.54%. The E[bullet]fund(R) had an average maturity of 22 days as well
and an effective yield of 5.87%.
The innovative E[bullet]fund(R) performed exceptionally well in its
second year. For the year ending 6/30/97, it was ranked #1 for total return
among 292 money market portfolios tracked by Lipper Analytical Services, Inc.
The portfolio materially benefited from a fee waiver of 0.5%.
Boosting the E[bullet]fund(R)'s performance was the unique
E[bullet]fund(R) Refund that takes 1% of the purchases made with the
portfolio's debit card and returns it to the portfolio up to 9.75% of the
portfolio's gross investment income. This innovation enhances the traditional
characteristics of a money market portfolio, namely safety and liquidity,
Money Market Portfolios:
E[bullet]fund(R) and Working Assets Money Market
Portfolio Manager:
Team
Objective:
Current income consistent with safety and liquidity.
Ground Rules:
Invest in liquid short-term money market instruments with the highest ratings by
two agencies, while maintaining a weighted average maturity of 90 days or less.
Results:
As of 6/30/97, the E[bullet]fund(R) had a simple yield of 5.71% and a
7-day effective yield of 5.87%. The E[bullet]fund(R) was the #1 money
market portfolio for total return among the 292 money market portfolios tracked
by Lipper Analytical Services, Inc. for the year ending 6/30/97. The Working
Assets Money Market portfolio (retail) had a 7-day simple yield of 4.44% and a
7-day effective yield of 4.54%. The Institutional class shares had a 7-day
simple yield of 5.09% and a 7-day effective yield of 5.22%.
13
<PAGE>
1997 Annual Report
Manager's Comments
by providing an additional source of secure income. The debit card and the free
checking that come with the E[bullet]fund(R) make it an ultra-functional
transactional account on a daily basis.
For the remainder of 1997, Fed policy will be dictated by the expectations
of future inflation and growth in the economy. As long as inflation remains
benign, the Fed may be able to hold rates steady. The most recent economic data
suggest this unusual outcome may be realized, since growth has slowed
appreciably since the Fed's last move. Should inflation surface, however, we
should expect the normal historical pattern of a series of rate hikes.
The Working Assets Money Market Fund and E[bullet]fund(R) continue to
be poised defensively with relatively short maturities. This position will allow
us to benefit if rates rise. At the same time, since the yield curve is quite
flat, we are earning virtually the highest yields available in the short-term
market.
14
<PAGE>
financial review
table of contents: [encircled]
Statement of Investments . . . . . . . . . . . . . . . 16
Statement of Assets and Liabilities . . . . . . . . . . 40
Statement of Operations . . . . . . . . . . . . . . . . 43
Statement of Changes in Net Assets . . . . . . . . . . 45
Financial Highlights . . . . . . . . . . . . . . . . . 49
Notes to Financial Statements . . . . . . . . . . . . . 57
Report of Independent Certified Public Accounts . . . . 63
15
<PAGE>
1997 Annual Report
Statement of Investments - June 30, 1997
<TABLE>
<CAPTION>
Working Assets Money Market Portfolio
Principal Security Yield Maturity Value(a)
Amount Description Date (Note 1)
<S> <C> <C> <C> <C> <C>
Certificates Of Deposit 0.49%
100,000 Bank Of New Jersey 5.160% 10/20/97 $100,000
100,000 Boston Bank Of Commerce 5.200% 10/20/97 100,000
100,000 Community Capital Bank CD 5.150% 10/20/97 100,000
100,000 Independence Bank Chicago 5.150% 12/27/97 100,000
100,000 Self Help Credit Union 5.230% 7/24/97 100,000
Total Certificates ============
Of Deposit (Cost $500,000) 500,000
Commercial Paper 90.27%
1,000,000 Air Products and Chemicals Inc. 5.520% 7/31/97 995,400
165,000 Air Products and Chemicals Inc. 5.600% 8/22/97 163,665
650,000 Ameritech Corp. 5.500% 7/16/97 648,510
3,200,000 Ameritech Corp. 5.550% 7/16/97 3,192,600
4,800,000 Bankers Trust New York Corp. 5.540% 9/10/97 4,747,555
3,985,000 Bank Of New York 5.535% 7/22/97 3,972,133
2,400,000 Bell Atlantic Financial Services 5.580% 7/2/97 2,399,628
1,700,000 Bell Atlantic Network Funding Corp. 5.580% 7/11/97 1,697,365
4,800,000 B.I.Funding Inc. 5.580% 9/3/97 4,752,384
695,000 Block Financial Corp. 6.200% 7/1/97 695,000
4,800,000 Campbell Soup Co. 5.500% 7/7/97 4,795,600
4,800,000 Chubb Capital Corp. 5.520% 7/7/97 4,795,584
1,950,000 Coca Cola Company 5.440% 7/22/97 1,943,812
1,400,000 Cooperative Association of Tractor Dealers 5.640% 7/1/97 1,400,000
1,700,000 Cooperative Association of Tractor Dealers 5.600% 8/1/97 1,691,802
1,400,000 Cooperative Association of Tractor Dealers 5.620% 8/1/97 1,393,225
2,745,000 Countrywide Funding Corp. 5.580% 7/2/97 2,744,575
2,000,000 Countrywide Funding Corp. 5.570% 7/30/97 1,991,026
3,560,000 Harley Davidson Dealer Funding 5.630% 7/9/97 3,555,546
3,385,000 Hasbro Inc. 5.570% 8/29/97 3,354,100
440,000 Hasbro Inc. 5.620% 10/7/97 433,268
3,930,000 Idaho Power Co. 5.530% 7/21/97 3,917,926
870,000 Idaho Power Co. 5.530% 7/24/97 866,926
4,800,000 Mid States Corporate Federal Credit Union 5.570% 7/17/97 4,788,117
960,000 Minnesota Mining and Manufacturing Co. 5.500% 7/22/97 956,920
510,000 Minnesota Mining and Manufacturing Co. 5.500% 8/12/97 506,728
4,800,000 Pacific Bell 5.500% 7/18/97 4,787,533
2,315,000 Pitney Bowes Credit Corp. 5.500% 7/17/97 2,309,341
600,000 Pitney Bowes Credit Corp. 5.510% 7/18/97 598,439
575,000 Providian Corporation 5.550% 7/17/97 573,582
2,315,000 Providian Corporation 5.520% 7/21/97 2,307,901
1,000,000 Safeco Credit Company Inc. 5.580% 7/11/97 998,450
325,000 Safeco Credit Company Inc. 5.550% 8/8/97 323,096
1,220,000 Safeco Credit Company Inc. 5.550% 9/12/97 1,206,270
</TABLE>
16 See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
Working Assets Money Market Portfolio (con't.)
Principal Security Yield Maturity Value(a)
Amount Description Date (Note 1)
<S> <C> <C> <C> <C>
Commercial Paper (con't.)
3,630,000 Sears Roebuck Acceptance Corp. 5.550% 7/16/97 3,621,606
3,025,000 Sonoco Products Co. 5.520% 7/22/97 3,015,260
3,760,000 Toronto Dominion Holdings USA Inc. 5.500% 7/11/97 3,754,256
4,800,000 Toys R Us Inc. 5.470% 7/2/97 4,799,270
2,000,000 Xerox Credit Corp. 5.530% 7/8/97 1,997,849
Total Commercial Paper -------------
(Cost $92,692,248) 92,692,248
Farmers Home
Administration 0.17%
177,296 Variable Rate Notes 7.125%
(Cost $177,296) (b)(e) (b) 177,296
Total Farmers ------------
Home Administration (Cost $177,296) 177,296
US Government
Agencies 2.52%
1,000,000Student Loan Marketing Assn. 5.286% 11/20/97 1,000,133
1,585,000Student Loan Marketing Assn. 5.265% 10/17/97 1,584,570
Total US Government -------------
Agencies(Cost $2,584,703) 2,584,703
Small Business
Administration 3.90%
3,999,424 Variable Rate Notes 6.895-8.375%
(Cost $4,005,950)(b)(c) (b) 4,005,950
Total Small ------------
Business Administration 4,005,950
Total Investments 97.35% ============
(Cost $99,960,197)(d) 99,960,197
Other assets,
less liabilities 2.65% 2,723,100
------------
Net Assets 100% $102,683,297
============
</TABLE>
Key:
(a) Investments are based upon amortized cost method.
(b) Variable rates are subject to change for the time periods ranging from every
7 to every 90 days.
(c) Includes a total of 10 notes.
(d) Cost for federal income tax purposes is the same.
(e) Includes a total of 2 notes.
See accompanying notes to financial statements.
17
<PAGE>
1997 Annual Report
Statement of Investmants-June 30,1997
<TABLE>
<CAPTION>
Citizens Income Fund
Principal Security Yield Maturity Value(a)
Amount Description Date (Note 1)
<S> <C> <C> <C> <C>
Corporate Bonds 73.66%
Advertising and Publishing 4.62%
1,400,000 Time Warner Inc. 9.125% 1/13/15 $1,536,400
----------
1,536,400
Amusement 6.32%
760,000 Cobb Theatres 10.625% 3/1/03 833,150
1,250,000 John Q Hammon Hotels 8.875% 2/15/04 1,267,188
---------
2,100,338
Banks 3.32%
100,000 First Chicago NBD Corp. 7.25% 8/15/04 101,269
500,000 Security Capital Pacific Inc. 7.90% 2/15/16 504,530
500,000 Wells Fargo Capital Appreciation 8.125% 12/1/26 497,855
---------
1,103,654
Broadcasting and
Communication 7.27%
750,000 Jones Intercable Inc. 11.500 7/15/04 800,625
800,000 Panamset Corp. 9.75% 8/1/00 841,000
750,000 Sullivan Broadcasting 10.250 12/15/05 774,375
---------
2,416,000
Computer, Office and
Business Equipment 8.67%
1,600,000 Corporate Express Inc. 9.125 3/15/04 1,594,000
15,000 Microsoft Corp. 0.00% 12/15/99 1,286,250
---------
2,880,250
Financial Services
and Insurance 15.23%
250,000 Countrywide Capital Industries 8.000% 12/15/26 249,355
325,000 Countrywide Funding Corp. 8.250% 7/15/02 342,423
831,951 DLJ Mortgage Acceptance Corp. 6.620% 5/25/09 803,612
700,000 Lehman Brothers Holdings Inc. 8.050% 1/15/19 713,384
800,000 Lehman Brothers Inc. 5.040% 12/15/03 807,744
50,000 MBIA Inc. 9.000% 2/15/01 53,452
1,000,000 Property Trust of America 6.875% 2/15/08 970,660
1,000,000 Secured Finance Dels 9.050% 12/15/04 1,119,250
----------
5,059,880
Food And Consumer
Products 3.56%
400,000 Kroger Co. 8.50% 6/15/03 418,500
750,000 Smiths Food and Drug Centers Inc. 8.640% 7/2/12 765,000
</TABLE>
See accompanying notes to financial statements.
18
<PAGE>
Citizens Trust
Statement of Investmants-June 30,1997
<TABLE>
<CAPTION>
Citizens Income Fund (con't.)
Principal Security Yield Maturity Value(a)
Amount Description Date (Note 1)
<S> <C> <C> <C> <C>
----------
1,183,500
Healthcare 4.39%
1,000,000 Healthsource Inc. 5.000% 3/1/03 990,000
50,000 Kaiser Foundation Health Plan 9.000% 11/1/01 54,125
150,000 Manor Care Inc. 9.500% 11/15/02 157,125
250,000 Quorum Health Group Inc. 8.750% 11/1/05 258,750
----------
1,460,000
Business Products and Services 7.46%
750,000 MVE Inc. 12.500% 2/15/02 767,813
900,000 Neodata Services Inc. 12.000% 5/1/03 961,875
750,000 Williams Scotsman Inc. 9.875% 6/1/07 750,000
----------
2,479,688
Real Estate 7.84%
1,300,000 Erp Operating Ltd. Partnership 7.570% 8/15/26 1,311,908
1,300,000 Weingarten Realty Investors 6.880% 6/25/27 1,292,290
----------
2,604,198
Retail 4.98%
360,000 Barnes and Noble Inc. 11.875% 1/15/03 389,700
1,202,000 Mattel Inc. 10.125% 8/15/02 1,265,105
----------
1,654,805
Total Corporate Bonds ----------
(Cost $24,107,186) 24,478,713
Warrants 0.07%
750 MVE Holdings Inc. 2/15/02 22,500
Total Warrants (Cost $0) ----------
22,500
Long Term US
Government Agencies 18.39%
Federal Home Loan Mortage 3.97%
Federal Home Loan 6.800-8.750% 6/15/05-
1,305,322.90 Mortgage Pool Discount Notes 4/15/18 1,321,535
Federal National
Mortgage Association 9.50%
Federal National 0.00-8.00% 7/25/06-
10,232,556 Mortgage Assn. 10/9/18 3,157,078
</TABLE>
See accompanying notes to financial statements.
19
<PAGE>
1997 Annual Report
Statement of Investmants-June 30,1997
<TABLE>
<CAPTION>
Citizens Income Fund (con't.)
Principal Security Yield Maturity Value(a)
Amount Description Date (Note 1)
<S> <C> <C> <C> <C>
Government National
Mortgage Association 4.92%
1,616,295 Government National Mortgage Assn. 6.00-9.00% 4/15/07- 1,634,152
6/15/23
Total Long Term -----------
US Government Agencies (Cost $6,141,329) 6,112,765
Short Term Investments 6.22%
600,000 Federal Farm Credit Bank 5.400% 7/7/97 599,460
250,000 Federal Home Loan Bank 5.370% 7/2/97 249,963
1,000,000 Federal Home Loan Bank 5.30% 7/1/97 1,000,000
216,000 State Street Bank and Trust (b) 5.600% 7/1/97 $ 216,000
Total Short Term -----------
Investments (Cost $2,065,423) 2,065,423
Total Investments -----------
(Cost $32,313,938)(a) 98.34% 32,679,401
Other assets, -----------
less liabilities 1.66% 550,769
===========
Net Assets 100% $33,230,170
===========
</TABLE>
Key:
(a) Cost for federal income tax purposes is the same.
(b) Collateralized by U.S. Government Securities having a market value of
$222,772; value at maturity $216,034.
See accompanying notes to financial statements.
20
<PAGE>
<TABLE>
<CAPTION>
Citizens Trust
Statement of Investments- June 30, 1997
Citizens Index Portfolio
Share Security
Amount Description Value
<S> <C> <C>
Equities 99.53%
Apparel and
Textiles 0.71%
2,300 Gymboree Corp. (b) $55,200
6,500 Liz Claiborne Inc. 303,062
5,900 Reebok International Ltd. 275,825
3,300 Russell Corp. 98,378
1,300 Springs Industries Inc. 68,575
4,100 Stride Rite Corp. 52,788
3,400 Tommy Hilfiger Corp. (b) 134,364
5,400 V F Corp. 457,650
4,500 Warnaco Group Inc. 143,438
---------
1,589,280
Banks 8.46%
35,600 Bank New York Inc. 1,548,600
13,500 BankBoston Corp. 972,843
6,900 Bankers Trust New York Corp. 600,300
18,300 Barnett Banks Inc. 960,750
9,700 Comerica Inc. 664,060
19,000 Corestates Financial Corp. 1,021,250
28,684 First Chicago NBD Corp. 1,735,381
20,500 Keycorp New 1,145,438
23,800 Mellon Bank Corp. 1,073,975
20,300 National City Corp. 1,065,750
34,300 Norwest Corp. 1,929,375
29,500 PNC Bank Corp. 1,227,938
20,200 Suntrust Banks Inc. 1,112,263
13,100 US Bancorp 840,038
14,800 Wachovia Corp. 863,025
8,200 Wells Fargo and Co. 2,209,900
---------
18,970,886
Communications
Equipment 0.19%
10,700 Ascend Communications Inc. (b) 421,312
---------
421,312
Computer, Hardware and
Business Equipment 10.04%
30,450 3Com Corp. (b) 1,370,250
11,300 Amdahl Corp. (b) 98,875
11,600 Apple Computer (b) 165,300
61,000 Cisco Systems Inc. (b) 4,094,625
25,200 Compaq Computer Corp. (b) 2,501,100
33,375 Computer Associates International Inc. 1,858,570
See accompanying notes to financial statements.
21
<PAGE>
1997 Annual Report
Statement of Investments - June 30, 1997
Citizens Index Portfolio (Con't.)
Share Security
Amount Description Value
Computer, Hardware and Business Equipment (con't.)
15,300 Dell Computer Corp. (b) 1,796,794
13,700 Digital Equipment Corp. (b) 485,494
1,100 Dionex Corp. (b) 55,674
22,600 EMC Corp. (b) 876,787
13,900 Equifax Inc. 506,770
41,200 First Data Corp. 1,801,440
14,100 Gateway 2000 Inc. (b) 457,369
4,000 General Signal Corp. 174,738
12,100 Ikon Office Solutions Inc. 301,744
19,300 Micron Technology Inc. (b) 770,794
31,900 Novell Inc. (b) 221,306
13,400 Pitney Bowes Inc. 931,300
16,300 Silicon Graphics Inc. (b) 244,500
33,900 Sun Microsystems Inc. (b) 1,261,716
10,600 Tandem Computers Inc. (b) 214,650
29,300 Xerox Corp. 2,311,038
----------
22,500,834
Construction And
Housing 1.15%
2,600 Apogee Enterprises Inc. 55,900
3,500 Armstrong World Industries Inc. 256,812
2,700 Centex Corp. 109,688
5,400 Choice Hotels Holdings Inc. (b) 91,463
14,500 HFS Inc. (b) 841,000
14,800 Masco Corp. 617,900
2,100 Pulte Corp. 72,580
5,500 Rouse Co. 162,250
8,200 Stanley Works 328,000
1,300 TJ International Inc. 30,550
----------
2,566,143
Consumer
Durables 0.29%
1,255 Harman International Industries Inc. 52,866
8,700 Maytag Corp. 227,288
1,100 Toro Co. 41,662
6,200 Whirlpool Corp. 338,288
----------
660,104
Electronics 9.70%
11,400 ADC Telecommunications Inc. (b) 380,475
12,900 Advanced Micro Devices Inc. (b) 464,400
8,100 Altera Corp. (b) 409,050
8,200 American Power Conversion Corp. (b) 155,800
See accompanying notes to financial statements.
22
<PAGE>
Citizens Trust
Statement of Investments - June 30, 1997
Citizens Index Portfolio (Con't.)
Share Security
Amount Description Value
Electronics (con't.)
20,200 Amp Inc. 843,350
16,600 Applied Materials Inc. (b) 1,175,488
3,600 Avnet Inc. 207,000
1,800 Belden Inc. 61,313
11,900 General Instrument Corp. (b) 297,500
10,000 Global Village Communications (b) 30,000
93,300 Hewlett Packard Co. 5,224,800
75,200 Intel Corp. 10,664,300
13,000 LSI Logic Corp. (b) 416,000
11,468 Molex Inc. 418,582
3,800 National Service Industries Inc. 185,012
3,600 Perkin Elmer Corp. 286,425
2,800 Tektronix Inc. 168,000
5,000 Thomas and Betts Corp. 262,812
4,000 VLSI Technology Inc. (b) 94,500
----------
21,744,807
Energy and
Utilities 1.96%
7,300 American Waterworks Inc. 156,859
5,800 Cal Energy Inc. (b) 220,400
8,700 Consolidated Natural Gas Co. 468,169
71,429 Energia Global (b) 250,002
23,400 Enron Corp. 955,012
3,500 Idaho Power Co. 110,237
7,000 MCN Energy Group Inc. 213,850
4,000 Nicor Inc. 143,500
2,600 Oneok Inc. 83,688
7,700 Pacific Enterprises 258,912
2,600 Peoples Energy Corp. 97,338
1,800 Philadelphia Suburban Corp. 34,515
7,900 Sonat Inc. 404,875
120,000 Vulcan Power Co. (b)(d) 0
4,600 Western Atlas Inc. (b) 336,950
14,600 Williams Companies Inc. 638,750
1,000 Yankee Energy Systems Inc. 24,500
----------
4,397,557
Financial Services
and Insurance 10.01%
9,000 Accustaff Inc. (b) 210,541
9,200 H F Ahmanson And Co. 395,600
See accompanying notes to financial statements.
23
<PAGE>
1997 Annual Report
Statement of Investments - June 30, 1997
Citizens Index Portfolio (Con't.)
Share Security
Amount Description Value
Financial Services
and Insurance (con't.)
43,400 American Express Co. 3,233,300
22,187 American General Corp. 1,059,417
14,700 Aon Corp. 760,725
4,900 Beneficial Corp. 348,206
16,100 Chubb Corp. 1,076,687
9,600 Countrywide Credit Industries Inc. 298,942
5,300 A G Edwards Inc. 226,575
63,800 Federal Home Loan Mortage Corp. 2,193,125
97,500 Federal National Mortgage Assn. 4,253,438
7,400 General Re Corp. 1,346,800
5,300 Golden West Financial Corp. 371,000
12,600 Great Western Financial Corp. 677,250
12,500 Green Tree Financial Corp. 445,313
5,900 Jefferson Pilot Corp. 412,263
4,000 MBIA Inc. 451,250
30,650 MBNA Corp. 1,122,556
10,800 MGIC Investment Corp. 517,725
8,600 Providian Financial Corp. (b) 276,275
11,600 Safeco Corp. 541,575
15,900 Charles Schwab Corp. 646,930
7,700 St Paul Companies Inc. 587,125
12,800 UNUM Corp. 537,600
11,600 USF and G Corp. 278,400
8,300 Viad Corp. 159,775
----------
22,428,393
Food and
Agriculture 11.93%
4,200 Ben and Jerrys Homemade Inc. (b) 57,750
42,700 Campbell Soup Co. 2,135,000
6,800 Case Corp. 461,821
400 Celestial Seasonings Inc. (b) 10,000
227,700 Coca Cola Company 15,369,750
13,200 CPC International Inc. 1,218,525
14,800 General Mills Inc. 963,850
33,800 H J Heinz Co. 1,559,025
14,000 Hershey Foods Corp. 774,375
19,100 Kellogg Co. 1,635,438
450 Odwalla Inc. (b) 5,400
12,500 Quaker Oats Co. 560,938
2,500 J M Smucker Co. 54,375
6,100 Supervalu Inc. 210,450
16,000 Sysco Corp. 584,000
See accompanying notes to financial statements.
24
<PAGE>
Citizens Trust
Statement of Investments - June 30, 1997
Citizens Index Portfolio (Con't.)
Share Security
Amount Description Value
2,008 Tootsie Roll Industies Inc. 89,356
9,300 Whitman Corp. 235,406
1,800 Whole Foods Market Inc. (b) 59,625
800 Wholesome And Hearty Foods Inc. (b) 6,500
766 Worthington Foods Inc. 18,767
10,700 William Wrigley Jr Co. 716,900
----------
26,727,251
Healthcare and
Personal Care 9.40%
3,432 Aegon 240,447
7,100 Alza Corp. 205,900
12,100 Avon Prods Inc. 853,806
4,625 Bergen Brunswig Corp. 128,922
9,900 Biomet Inc. 184,388
1,200 Cyanotech Corp. (b) 6,060
31,500 Healthsouth Corp. (b) 785,531
3,500 Idexx Labs Inc. (b) 43,531
2,500 Invacare Corp. 58,438
5,200 Manor Care Inc. 169,650
21,900 Medtronic Inc. 1,773,900
110,900 Merck and Co. Inc. 11,478,150
1,550 Natures Sunshine Prods Inc. 28,094
2,300 Owens + Minor Inc. 34,356
7,200 Oxford Health Plans Inc. (b) 522,410
2,000 Patterson Dental Co. (b) 68,850
7,000 Perrigo Co. (b) 88,944
3,600 Physician Corporation of America (b) 22,950
2,200 R P Scherer Corp. (b) 113,575
67,200 Schering Plough Corp. 3,217,200
2,200 Sofamor/Danek Group Inc. (b) 100,650
8,700 St Jude Medical Inc. (b) 339,300
4,100 Sun Healthcare Group Inc. (b) 85,331
3,900 Trigon Healthcare Inc. (b) 96,445
3,000 Universal Health Services Inc. (b) 115,556
6,400 Wellpoint Health Networks Inc. (b) 296,195
----------
21,058,579
Industrial Products 1.37%
10,000 Air Products and Chemicals Inc. 812,500
2,100 Betzdearborn Inc. 138,600
2,200 BMC Industries Inc. 75,350
15,400 Cognizant Corp. 623,700
6,100 Nalco Chem Co. 235,612
See accompanying notes to financial statements.
25
<PAGE>
1997 Annual Report
Statement of Investments - June 30, 1997
Citizens Index Portfolio (Con't.)
Share Security
Amount Description Value
Industrial Products (Con't)
14,500 Praxair Inc. 812,000
9,200 Sigma Aldrich 322,575
2,500 Wellman Inc. 43,438
----------
3,063,775
Media 2.74%
29,900 Comcast Corp. 639,112
8,100 Dow Jones and Co. Inc. 325,519
3,300 King World Productions Inc. 115,500
9,200 McGraw Hill Companies Inc. 541,075
4,900 Meredith Corp. 142,100
8,800 New York Times Co. 435,600
51,350 Time Warner Inc. 2,477,638
8,800 Times Mirror Co. 486,200
32,400 Viacom Inc. (b) 972,000
----------
6,134,744
Motor
Vehicles 0.52%
2,700 Federal Mogul Corp. 94,500
3,500 Fleetwood Enterprises Inc. 104,344
16,500 Genuine Parts Co. 558,938
6,600 Harley Davidson Inc. 316,388
900 SPX Corp. 58,330
1,500 Standard Products Co. 37,875
----------
1,170,375
Non-ferrous
Metals 0.13%
13,250 Engelhard Corp. 277,422
1,100 Imco Recycling Inc. 20,762
----------
298,184
Optical and
Photo 0.14%
3,300C Cube Microsystems Inc. (b) 57,956
1,300 Cymer Inc. (b) 61,821
3,500 Polaroid Corp. 194,250
----------
314,027
Paper and Forest
Products 0.52%
2,100 Caraustar Industries Inc. 72,712
4,100 Consolidated Papers Inc. 221,400
6,600 Fort Howard Corp. (b) 334,125
3,900 Sealed Air Corp. (b) 185,250
See accompanying notes to financial statements.
26
<PAGE>
Citizens Trust
Statement of Investments - June 30, 1997
Citizens Index Portfolio (Con't.)
Share Security
Amount Description Value
8,310 Sonoco Products Co. 252,936
6,200 Unisource Worldwide Inc. 99,200
----------
1,165,623
Producer Goods 1.99%
9,500 Avery Dennison Corp. 381,188
3,300 Cincinnati Milacron Inc. 85,594
23,400 Deere and Co. 1,284,075
2,000 Durco International Inc. (b) 58,500
11,600 Fedders USA Inc. 65,975
2,100 Idex Corp. 69,300
22,900 Illinois Tool Works Inc. 1,143,569
1,000 Ionics Inc. (b) 45,500
3,300 Keystone International Inc. 114,469
3,600 Miller, Herman Inc. 129,600
3,400 Millipore Corp. 149,600
1,500 Nordson Corp. 96,375
3,800 Raychem Corp. 282,625
5,600 Snap On Inc. 220,500
1,600 Tecumseh Products Co. 95,800
900 Tennant Co. 29,925
5,700 Timken Co. 202,705
----------
4,455,300
Recreation and
Entertainment 1.37%
6,900 American Greetings Corp. 256,162
6,700 Callaway Golf Co. 237,850
4,900 Coleman Co. Inc. (b) 84,525
14,00 Darden Restaurants Inc. 126,875
6,500 Harcourt General Inc. 309,563
11,800 Hasbro Inc. 334,825
2,000 Huffy Corp. 29,250
3,400 Jostens Inc. 90,950
26,775 Mattel Inc. 907,003
13,800 Rubbermaid Inc. 410,550
7,200 Starbucks Corp. (b) 280,350
----------
3,067,903
Retail 6.88%
2,800 Barnes and Noble Inc. (b) 120,400
7,800 Bruno's Inc. (b) 89,700
11,800 Charming Shoppes Inc. (b) 61,581
19,400 Costco Companies Inc. (b) 637,775
See accompanying notes to financial statements.
27
<PAGE>
1997 Annual Report
Statement of Investments - June 30, 1997
Citizens Index Portfolio (Con't.)
Share Security
Amount Description Value
Retail (con't.)
37,555 CUC International Inc. (b) 969,387
15,400 CVS Corp. 789,250
8,400 Dollar General Corp. 319,882
19,100 Federated Department Stores Inc. (b) 663,725
3,500 Fleming Companies Inc. 63,838
2,800 Footstar Inc. (b) 73,150
25,100 Gap Inc. 975,763
5,200 Giant Foods Inc. 169,650
2,900 Great Atlantic and Pacific Tea Inc. 78,844
3,900 Hannaford Brothers Co. 138,694
6,800 Kohls Corp. (b) 359,790
23,300 Kroger Co. (b) 675,700
26,100 Limited Inc. 528,525
3,000 Longs Drug Stores Corp. 78,563
15,900 Lowes Companies Inc. 590,288
21,80 May Department Stores Co. 1,030,050
6,900 Nordstrom Inc. 338,531
22,700 J C Penney Inc. 1,184,656
300 Real Goods Trading Corp. (b) 1,650
11,000 Rite Aid Corp. 548,625
36,000 Sears Roebuck and Co. 1,935,000
14,300 TJX Companies Inc. 377,163
26,200 Toys R Us Inc. (b) 917,000
5,700 Tupperware Corp. 208,050
22,600 Walgreen Co. 1,211,925
11,700 Woolworth Corp. (b) 280,800
----------
15,417,955
Software and
Data Processing 8.46%
5,233 A C Nielson Corp. (b) 102,697
6,600 Adobe System Inc. 231,412
9,000 America Online 500,625
4,300 Autodesk Incorporated 164,744
26,900 Automatic Data Processing Inc. 1,264,300
9,100 H and R Block Inc. 293,475
7,200 DeLuxe Corp. 245,700
1,100 Dialogic Corp. (b) 29,287
15,700 Dun and Bradstreet Corp. 412,125
2,800 John H Harland Co. 63,875
110,100 Microsoft Corp. (b) 13,913,888
8,600 Moore Corp. Ltd. 169,313
7,400 Network General Corp. (b) 110,075
See accompanying notes to financial statements.
28
<PAGE>
Citizens Trust
Statement of Investments - June 30, 1997
Citizens Index Portfolio (Con't.)
Share Security
Amount Description Value
11,700 Parametric Technology Corp. (b) 497,981
6,200 Qualcomm Inc. (b) 315,425
2,300 Shared Medical System 124,200
2,100 Stratus Computer Inc. (b) 105,000
7,200 Sybase Inc. (b) 107,100
5,600 Tandy Corp. 313,600
----------
18,964,822
Steel 0.12%
4,500 Inland Steel Industries Inc. 117,563
8,800 Worthington Industries Inc. 161,150
----------
278,713
Telephone 10.77%
46,200 Airtouch Communications Inc. (b) 1,264,725
17,100 Alltel Corp. 571,781
50,400 Ameritech Corp. 3,424,050
40,200 Bell Atlantic Corp. 3,050,175
91,200 Bellsouth Corp. 4,229,400
5,000 Mobile Telecommunication (b) 71,563
83,759 SBC Communications Inc. 5,182,588
16,600 Tellabs Inc. (b) 927,525
44,000 U S West Communications Group 1,658,250
55,700 U S West Media Group (b) 1,127,925
82,000 Worldcom Inc. (b) 2,624,000
----------
24,131,982
Tires and Rubber 0.11%
2,000 Bandag Inc. 98,000
7,200 Cooper Tire and Rubber Co. 158,400
----------
256,400
Transportation 0.57%
3,300 Caliber Systems Inc. 122,925
10,200 Federal Express Corp. (b) 589,050
5,150 Illinois Central Corp. 179,928
1,700 Roadway Express Inc. 39,738
13,400 Southwest Airlines Co. 346,725
----------
1,278,366
Total Equities ----------
(Cost $147,221,660) 223,063,315
Short Term Investments 0.69%
1,556,000 State Street Bank and Trust (e) 5.6% 1,556,000
7/1/97
See accompanying notes to financial statements.
29
<PAGE>
1997 Annual Report
Statement of Investments - June 30, 1997
Citizens Index Portfolio (Con't.)
Share Security
Amount Description Value
Total Short Term Investments ---------
(Cost $1,556,000) 1,556,000
Total Investments -----------
(Cost $148,777,660) (a) 100.22% 224,619,315
Liabilities in excess
of other assets (.22%) (502,682)
------------
Net Assets 100% $224,116,633
============
Key:
(a) Cost for federal income tax purposes is the same.
(b) Non-income producing security.
(c) Restricted security, see note 4.
(d) Security deemed worthless.
(e) Collateralized by U.S. Government Securities having a market value of
$1,589,779; value at maturity $1,556,242.
See accompanying notes to financial statements.
30
<PAGE>
Citizens Trust
Statement of Investments - June 30, 1997
Citizens Emerging Growth Portfolio
Share Security
Amount Description Value
Equities 94.52%
Apparel and
Textiles 2.42%
20,000 Pacific Sunwear of California (b) 645,000
37,000 Interface Inc. 818,625
----------
1,463,625
Banks 5.59%
33,230 ContiFinancial Corp. (b) 1,212,895
31,810 Comerica Inc. 2,163,080
----------
3,375,975
Broadcasting and
Communications 4.39%
26,00 Clear Channel Communications (b) 1,599,000
23,550 Evergreen Media (b) 1,050,919
----------
2,649,919
Computer, Office and
Business Equipment 18.81%
29,810 3Com Corp. (b) 1,341,450
50,000 Clarify Inc. (b) 565,625
25,000 Compuware Corp. (b) 1,231,250
13,500 Dell Computer Corp. (b) 1,585,406
17,800 Electronics For Imaging Inc. (b) 841,050
35,000 Flextronics International (b) 945,000
30,000 Integrated Process Equipment Corp. (b) 771,249
40,300 Knoll Inc. (b) 957,125
15,000 Linear Technology Corp. 776,250
9,500 McAfee Assocs Inc. (b) 589,812
25,000 Wind River Systems Inc. (b) 946,875
16,300 Xilinx Inc. (b) 799,719
----------
11,350,811
Electronics 4.91%
28,500 Altera Corp. (b) 1,439,250
21,500 Applied Materials Inc. (b) 1,522,469
----------
2,961,719
Financial Services and
Insurance 8.90%
46,000 CMAC Investment Corp. 2,196,500
34,800 Coast Savings Financial Inc. (b) 1,581,225
See accompanying notes to financial statements.
31
<PAGE>
1997 Annual Report
Statement of Investments - June 30, 1997
Citizens Emerging Growth Portfolio (Con't.)
Share Security
Amount Description Value
Financial Services and
Insurance (con't.)
32,500 SunAmerica Inc. 1,590,063
----------
5,367,788
Food and Consumer
Products 1.57%
20,000 Jones Medical Industries Inc. 950,000
----------
950,000
Health and
Personal Care 1.18%
40,000 American Retirement Corp. (b) 710,000
----------
710,000
Healthcare 14.72%
9,000 Agouron Pharmaceuticals Inc. (b) 727,875
20,000 BioChem Pharma Inc. (b) 445,000
66,620 Healthsouth Corp. (b) 1,661,336
21,000 McKesson Corp. 1,627,500
52,010 Nitinol Medical Technologies Inc. (b) 786,651
75,000 Physician Sales and Services Inc. (b 1,425,000
10,400 Quintiles Transnational Corp. (b) 724,100
40,000 Spine-Tech Inc. (b) 1,485,000
----------
8,882,462
Industrial
Products 5.29%
20,420 Betzdearborn Inc. 1,347,720
32,900 Praxair Inc. 1,842,400
----------
3,190,120
Optical and
Photo 1.09%
13,500 Cymer Inc. (b) 658,125
----------
658,125
Producer Goods 2.88%
15,000 Deere and Co. 823,125
25,400 Miller, Herman Inc. 914,400
----------
1,737,525
Recreation and
Entertainment 2.82%
16,980 Callaway Golf Co. 602,790
52,400 Suburban Lodges of America Inc. (b) 1,100,400
----------
1,703,190
See accompanying notes to financial statements.
32
<PAGE>
Citizens Trust
Statement of Investments - June 30, 1997
Citizens Emerging Growth Portfolio (Con't.)
Share Security
Amount Description Value
Retail 6.74%
33,470 CVS Corp. 1,715,337
25,000 Michaels Stores Inc. (b) 529,688
69,120 TJX Companies Inc. 1,823,040
----------
4,068,065
Software and
Data Processing 13.21%
29,000 Automatic Data Processing Inc. 1,363,000
17,740 Baan Co. N.V. (b) 1,221,842
29,280 Dr Solomons Group PLC (b) 742,980
33,180 HNC Software Inc. (b) 1,264,988
23,600 Peoplesoft Inc. (b) 1,244,900
25,600 Saville Systems PLC (b) 1,331,200
23,200 Transaction System Architects Inc. (b) 800,400
----------
7,969,310
Total Equities ----------
(Cost $65,360,878) 94.52% 57,038,634
Short Term
Investments 19.89%
State Street Bank and Trust
12,000,000 5.6%, 07/01/97 (c) 12,000,000
Total Short Term Investments ----------
(Cost $12,000,000.00) 12,000,000
Total Investments ----------
(Cost $62,496,345) (a) 114.41% 69,038,634
Liabilities in excess
of other assets (14.41%) (8,697,703)
-----------
Net Assets 100% $60,340,931
===========
Key:
(a) Cost for federal income tax purposes is the same.
(b) Non-income producing security.
(c) Collateralized by U.S. Government Securities having a market value of
$12,242,310; value at maturity $12,001,867.
See accompanying notes to financial statements.
33
<PAGE>
1997 Annual Report
Statement of Investments - June 30, 1997
Citizens Global Equity Fund
Share Security
Amount Description Value
Equities 85.81%
Belgium 1.50%
2,186 Barco N.V. (Electronics) $443,281
----------
443,281
France 5.61%
5,000 SGS-Thomson Microelectronics N.V.(b) (Electronics) 395,167
2,000 Legrand (Industrial Products) 352,584
3,000 Hermes International (Retail/Consumer Products) 281,045
4,000 Salomon (Retail/Consumer Products) 305,301
848 Adecco SA (Temporary Employment Services) 325,857
----------
1,659,954
Germany 1.37%
1,950 SAP AG (Software and Data Processing) 405,100
----------
405,100
Great Britain 5.95%
32,000 Reed International (Advertising and Publishing) 308,894
24,500 National Westminster Bank PLC (Banks) 42,340
8,000 Norwich Union (b) (Financial Services and Insurance) 329,260
36,000 Powerscreen International Group (Industrial Products) 393,640
32,000 Next (Retail/Consumer Products) 361,087
35,326 BAA (Transportation/Business Services) 325,420
----------
1,760,641
Ireland 1.70%
46,041 Bank Of Ireland (Banks) 503,572
----------
503,572
Italy 3.37%
76,000 Bulgari (Retail/Consumer Products) 429,691
177,000 Telecom Italia (b) (Telephone) 567,460
----------
997,151
Japan 13.60%
28,000 Bank of Tokyo Mitsubishi (Banks) 562,789
26,000 Canon Inc. (Computer, Hardware and Business Equipment) 708,905
14,800 Tokyo Electron (Computer, Hardware and Business Equipment) 708,765
46,000 NEC Corp. (Electronics) 643,188
4,000 TDK Corp. (Electronics) 293,979
6,000 Ito-Yokado Co. (Food And Consumer Products) 348,685
18,000 Fuji Photo Film Co. (Optical and Photo) 725,159
620 Familymart Co. (Retail/Consumer Products) 30,450
----------
4,021,920
See accompanying notes to financial statements.
34
<PAGE>
Citizens Trust
Statement of Investments - June 30, 1997
Citizens Global Equity Fund (Con't.)
Share Security
Amount Description Value
Mexico 3.72%
275,000 Grupo Financiero Banamex Acciual (b) (Banks) 645,797
217,000 Cifra, S.A. de C.V., Class B (Food And Consumer Products) 403,746
26,541 Cifra, S.A. de C.V., Class A (Food And Consumer Products) 48,980
----------
1,098,523
Netherlands 3.50%
OCE-Van Der Grinten N.V.
2,511 (Computer, Hardware and Business Equipment) 0
3,927 Aegon (Financial Services and Insurance) 274,584
15,000 Ver Ned Uitgevers (Publishing/Media) 332,258
6,300 Baan Company N.V. (b) (Software and Data Processing) 427,648
----------
1,034,490
Norway 3.08%
30,000 Tomra Systems A/S (Industrial Products) 614,687
14,900 Schibsted (Publishing/Media) 295,118
----------
909,805
Philippines 1.65%
15,000 Metro Bank and Trust Co. (Banks) 318,471
235,000 Ayala Corp. (Conglomerate/Multi-industry) 169,283
----------
487,754
Portugal 0.82%
6,000 Portugal Telecom (Telephone) 242,335
----------
242,335
Spain 3.54%
19,500 Banco Santander (Banks) 601,958
55 Aguas De Barcelona (Utilities/Water Services) 2,255
15,300 Telefonica De Espana (Telephone) 443,177
----------
1,047,390
Sweden 1.49%
22,000 Trygg-Hansa AB (Financial Services and Insurance) 439,580
----------
439,580
Switzerland 4.09%
1,200 Zurich Versicherun (b) (Financial Services and Insurance) 478,238
650 Sulzer Brothers Ltd (Industrial Products) 557,328
452 Adecco SA (Temporary Employment Services) 173,626
----------
1,209,192
United States 30.82%
10,000 Suntrust Bank Inc. (Banks) 550,625
13,800 Unibanco Uniao De Barncos Bras ADR (b) (Banks) 512,325
See accompanying notes to financial statements.
35
<PAGE>
1997 Annual Report
Statement of Investments - June 30, 1997
Citizens Global Equity Fund
Share Security
Amount Description Value
United States (con't.)
Cisco Systems Inc. (b)
10,300 (Computer, Hardware and Business Equipment) 691,388
Computer Associates International Inc.
6,000 (Computer, Hardware and Business Equipment) 334,125
Sun Microsystems Inc. (b)
5,000 (Computer, Hardware and Business Equipment) 186,094
6,000 Intel Corp. (Electronics) 850,875
14,000 Fresenius Medical Care AG ADR (b) (Healthcare) 407,750
Federal National Mortgage Association
11,500 (Financial Services and Insurance) 501,688
6,500 Merck and Co. Inc. (Healthcare) 672,750
6,300 Air Products and Chemicals Inc. (Industrial Products) 511,875
10,000 Illinois Tool Works Inc. (Producer Goods) 499,375
10,000 SunGuard Data Systems (b) (Software and Processing) 465,000
18,000 Airtouch Communications Inc. (b) (Telephone) 492,750
8,200 Telecomunicacoes Brasileiras ADR (Telephone) 1,244,350
15,000 Telefonica Del Peru ADR (b) (Telephone) 392,813
25,000 Worldcom Inc. (b) (Telephone) 800,000
-----------
9,113,783
-----------
Total Equities (Cost $18,627,095) 25,374,471
Short Term Investments 13.32%
-----------
State Street Bank and Trust 5.6%, 7/1/97 3,940,000
Total Short Term Investments -----------
(Cost $3,940,000.00) 3,940,000
Total Investments -----------
(Cost $22,567,095)(a) 99.13% 29,314,471
Other assets, less liabilities 0.87% 258,485
-----------
Net Assets 100% $29,572,956
===========
</TABLE>
Key:
(a) Cost for federal income tax purposes is the same.
(b) Non-income producing security.
(c) Collateralized by U.S. Government Securities having a maket value of
$4,020,014; value at maturity $3,940,613.
See accompanying notes to financial statements.
36
<PAGE>
Citizens Trust
Statement of Investments - June 30, 1997
<TABLE>
<CAPTION>
Muir California Tax-Free Income Portfolio
Principal Security Yield Maturity Value(a)
Amount Description Date (Note 1)
<S> <C> <C> <C> <C>
Municipal Securities 93.43%
Affordable
Housing 14.08%
California Housing
725,000 Finance Agency Revenue 6.000% 2/1/05 $754,761
California State Housing
750,000 Finance Agency Revenue 6.150% 8/1/16 773,655
California State Housing
100,000 Finance Agency Revenue 7.250% 4/1/07 100,743
10,000 Los Angeles CA Single Family Homes 6.750% 6/1/05 10,477
30,000 Riverside County CA Single Family Revenue 6.850% 10/1/16 33,101
----------
1,672,737
Education and
Health 17.51%
500,000 Duarte CA Certification of Partnership 6.125% 4/1/13 507,160
500,000 Healdsburg CA United High School Dist. 5.300% 7/15/10 507,370
500,000 Santa Monica Malibu School Dist. 5.500% 8/1/15 500,315
500,000 University CA Revenue Bonds 6.875% 9/1/16 564,280
----------
2,079,125
Environmental 61.84%
500,000 Burbank CA Wastewater Treatment Revenue 5.500% 6/1/15 496,530
California State
500,000 Department of Water Resources 5.000% 12/1/19 454,190
500,000 East Bay CA Municipal Utility District 001 5.000% 4/1/15 464,800
Kings County CA
440,000 Waste Management Authority 6.000% 10/1/99 450,032
500,000 Los Angeles CA Department Airports 5.800% 5/15/09 521,085
500,000 Los Angeles County CA Public Works 6.000% 10/1/15 515,055
500,000 Metropolitan Water District South CA 5.000% 7/1/13 478,130
500,000 Midpeninsula Regional Open Space District 5.900% 9/1/14 512,780
500,000 Mountain View CA Shoreline Park 5.600% 8/1/10 514,755
515,000 Pasadena CA Water Revenue 5.000% 7/1/18 466,446
Rancho CA Water
500,000 District Financing Authority 5.000% 8/15/14 471,845
500,000 San Francisco CA Public Utilities Commission 5.000% 11/1/15 473,460
500,000 Southgate CA Public Financing Authority 5.375% 10/1/09 514,960
500,000 Tulare CA Sewer Revenue 5.700% 11/15/12 511,955
Vista CA Joint Powers
500,000 Financing Authority Revenue 5.450% 5/1/12 499,330
----------
7,345,353
</TABLE>
See accompanying notes to financial statements.
37
<PAGE>
1997 Annual Report
Statement of Investments - June 30, 1997
<TABLE>
<CAPTION>
Muir California Tax-Free Income Portfolio (Con't.)
Principal Security Yield Maturity Value(a)
Amount Description Date (Note 1)
<S> <C> <C> <C> <C>
Total Municipal Securities ----------
(Cost $10,882,126) 11,097,215
Short Term Investments 4.07%
24,209 Goldman Sachs Trust 1.000% 12/31/99 24,209
270 Goldman Sachs Trust 3.560% 12/31/99 270
1,692 Municipal Fund For CA Investments Inc. 3.805% 12/31/99 1,692
457,061 Municipal Fund For CA Investments Inc. 3.842% 12/31/99 457,061
Total Short Term Investments ----------
(Cost $483,232) 483,232
Total Investments ----------
(Cost $11,365,358)(a) 97.50% 11,580,447
Other assets,
less liabilities 2.50% 297,392
-----------
Net Assets 100.00% $11,877,839
===========
</TABLE>
Key: (a) Cost for federal income tax purposes is the same.
See accompanying notes to financial statements.
E[bullet]Fund(R) Portfolio
<TABLE>
<CAPTION>
Principal Security Yield Maturity Value(a)
Amount Description Date (Note 1)
<S> <C> <C> <C> <C>
Commercial Paper 89.96%
435,000 Air Products and Chemicals, Inc. 5.600% 8/22/97 $431,481
800,000 Ameritech Corp. 5.500% 7/16/97 798,167
800,000 B.I.Funding Inc. 5.580% 9/3/97 792,064
800,000 Bank Of New York 5.535% 7/22/97 797,417
800,000 Bankers Trust New York Corp. 5.540% 9/10/97 791,259
400,000 Bell Atlantic Financial Services 5.580% 7/2/97 399,938
400,000 Bell Atlantic Network Funding 5.580% 7/11/97 399,380
700,000 Beneficial Corp. 5.570% 7/28/97 697,076
830,000 Block Financial Corp. 6.200% 7/1/97 830,000
800,000 Campbell Soup Co. 5.500% 7/7/97 799,267
250,000 Canadian Wheat Board 5.550% 9/15/97 247,071
800,000 Chubb Capital Corp. 5.520% 7/7/97 799,264
320,000 Coca Cola Company 5.440% 7/22/97 318,985
200,000 Cooperative Association of Tractor Dealers 5.640% 7/1/97 200,000
400,000 Cooperative Association of Tractor Dealers 5.580% 7/3/97 399,876
800,000 Countrywide Funding Corp. 5.550% 7/2/97 799,877
800,000 Harley Davidson Dealer Funding 5.630% 7/9/97 798,999
460,000 Hasbro Inc. 5.570% 8/29/97 455,801
155,000 Hasbro Inc. 5.590% 8/29/97 153,580
</TABLE>
38 See accompanying notes to financial statements.
<PAGE>
Citizen's Trust
Statement of Investments- June 30, 1997
E[bullet]Fund(R) Portfolio (Con't.)
<TABLE>
<CAPTION>
Principal Security Yield Maturity Value(a)
Amount Description Date (Note 1)
<S> <C> <C> <C> <C>
Commercial Paper (con't.)
230,000 Hasbro Inc. 5.620% 10/7/97 226,481
320,000 Idaho Power Co. 5.530% 7/21/97 319,017
480,000 Idaho Power Co. 5.530% 7/24/97 478,304
100,000 Kellogg Co. 5.500% 7/7/97 99,908
800,000 Mid States Corporate Federal Credit Union 5.570% 7/17/97 798,019
505,000 Minnesota Mining and Manufacturing Co. 5.500% 7/22/97 503,380
295,000 Minnesota Mining and Manufacturing Co. 5.500% 8/12/97 293,107
800,000 Pacific Bell 5.500% 7/18/97 797,922
360,000 Providian Corp. 5.550% 7/17/97 359,112
800,000 Sears Roebuck Acceptance Corp. 5.550% 7/16/97 798,150
800,000 Sonoco Prods Co. 5.520% 7/22/97 797,424
645,000 Toronto Dominion Holdings 5.500% 7/11/97 644,014
800,000 Toys R Us Inc. 5.470% 7/2/97 799,878
800,000 Xerox Credit Corp. 5.530% 7/8/97 799,140
-----------
Total Commercial Paper
(Cost $18,623,35) 18,623,358
US Government
Agencies 3.55%
145,000 Federal Home Loan Mortgage Discount Notes 5.410% 7/14/97 144,717
590,000 Federal Home Loan Mortgage Corp. 6.470% 7/7/97 590,100
-----------
Total US Government
Agencies (Cost $734,817) 734,817
Certificates of
Deposit 0.48%
100,000 South Shore Bank Of Chicago 5.150% 12/18/97 100,000
-----------
Total Certificates of
Deposit (Cost $100,000) 100,000
Small Business
Admininstration(b)(c) 1.23%
251,264 Variable Rate Notes (Cost $253,782) 7.00% - 8.37% (b) 253,782
-----------
Total Investments
(Cost $19,711,957)(d) 95.22% 19,711,957
Other assets, less liabilities 4.78% 990,281
-----------
Net Assets 100% $20,702,238
===========
</TABLE>
Key:
(a) Investments are based upon amortized cost method.
(b) Variable interest rates are subject to change every 7 to 90 days.
(c) Includes a total of 4 notes.
(d) Cost for income tax purposes is the same.
See accompanying notes to financial statements. 39
<PAGE>
1997 Annual Report
Statement of Investments - June 30, 1997
<TABLE>
<CAPTION>
Working Citizens
Assets Citizens Citizens Emerging
Money Market Income Index Growth
Portfolio Portfolio Portfolio Portfolio
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Assets
Investments in securities,
at market value
(Identified cost $99,960,197,
$32,313,938, $148,777,660,
and $62,496,345,
respectively) (Note 1) $ 99,960,197 $32,679,403 $224,619,315 $69,038,634
Cash 1,140,650 66 258,796 -
Receivable for:
Interest 129,519 597,423 242 1,182
Dividends - - 244,888 27,264
Fund shares sold 2,205,016 79,159 479,471 846,446
Investment securities sold - - 19,605,407 1,549,139
SBA principal paydowns 13,982 - -
Deferred organization costs (Note 1) 28,447 7,475 43,284 7,429
Prepaid expenses 34,078 5,777 23,706 2,681
------------ ----------- ------------ -----------
Total Assets 103,511,889 33,369,303 245,275,109 71,472,775
Liabilities
Payables:
Investment securities purchased - - 20,504,972 9,703,191
Capital shares redeemed 769,167 82,028 638,012 1,412,109
Distributions - 30,105 - -
Due to investment adviser 3,916 2,376 10,649 6,551
Accrued expenses 55,509 24,624 4,843 9,993
------------ ----------- ------------ -----------
Total Liabilities 828,592 139,133 21,158,476 11,131,844
Net Assets $102,683,297 $33,230,170 $224,116,633 $60,340,931
------------ ----------- ------------ -----------
Retail Shares
Net assets $ 85,179,413 $33,230,170 $211,116,037 $60,340,931
Shares outstanding 85,179,413 3,148,474 11,700,040 4,268,721
Net asset value,
offering and redemption price per share $ 1.00 $ 10.56 $ 18.04 $ 14.14
------------ ----------- ------------ -----------
Institutional Shares
Net assets $ 17,503,884 - $ 13,000,596 -
Shares outstanding 17,503,884 - 876,298 -
Net asset value, offering
and redemption price per share $ 1.00 - $ 14.84 -
------------ ----------- ------------ -----------
</TABLE>
40 See accompanying notes to financial statements.
<PAGE>
Citizens Trust
Statement of Assets and Liabilities - June 30, 1997
<TABLE>
<CAPTION>
Working Citizens
Assets Citizens Citizens Emerging
Money Market Income Index Growth
Portfolio Portfolio Portfolio Portfolio
<S> <C> <C> <C> <C>
Net Assets
At June 30, 1997 net assets
consisted of:
Paid-in capital $102,683,297 $32,965,473 $140,826,866 $55,230,604
Undistributed net
investment income - - 97,952 -
Accumulated realized gain (loss) - (100,768) 7,350,160 (1,431,962)
Net unrealized appreciation
of investments - 365,465 75,841,655 6,542,289
------------ ----------- ------------ -----------
$102,683,297 $33,230,170 $224,116,633 $60,340,931
============ =========== ============ ===========
</TABLE>
Muir
Citizens California
Global Tax-Free
Equity Income
Portfolio Portfolio E*Fund(R)
--------- --------- ---------
Assets
Investments in securities,
at market value
(Identified cost $22,567,095,
$11,365,358, and $19,711,957
respectively) (Note 1) $29,314,471 $11,580,447 $19,711,957
Cash (including foreign currencies) 31,047 4,078 644,875
Receivable for:
Interest 613 187,234 25,149
Dividends 84,678 - -
Fund shares sold 163,294 6,450 580,330
SBA principal paydowns - - 3,669
Deferred organization costs (Note 1) 7,428 39,891 139,952
Prepaid expenses and others 2,320 77,268 18,618
----------- ----------- -----------
Total Assets 29,603,851 11,895,368 21,124,550
Liabilities
Payables:
Capital shares redeemed 14,721 - 399,755
Distributions - 6,266 243
Due to investment adviser 3,249 22,314
See accompanying notes to financial statements. 41
<PAGE>
1997 Annual Report
Statement of Assets and Liabilities - June 30, 1997
Muir
Citizens California
Global Tax-Free
Equity Income
Portfolio Portfolio E*Fund(R)
--------- --------- ---------
Liabilities (con't.)
Accrued expenses 12,925 11,263 -
----------- ----------- -----------
Total Liabilities 30,895 17,529 422,312
Net Assets $29,572,956 $11,877,839 $20,702,238
----------- ----------- -----------
Shares outstanding 2,044,409 741,150 20,702,238
Net asset value, offering and
redemption price per share $14.47 $16.03 $1.00
----------- ----------- -----------
Net Assets
At June 30, 1997 net assets
consisted of:
Paid-in capital $22,719,876 $12,066,338 $20,702,238
Undistributed net investment income - 9,308 -
Accumulated realized gain (loss) of
investments and foreign currencies 107,740 (412,896) -
Net unrealized appreciation
of investments and foreign currencies 6,745,340 215,089 -
----------- ----------- -----------
$29,572,956 $11,877,839 $20,702,238
=========== =========== ===========
42 See accompanying notes to financial statements.
<PAGE>
Citizens Trust
Statement of Operations - Year Ended June 30, 1997
<TABLE>
<CAPTION>
Citizens
Working Assets Citizens Citizens Emerging
Money Market Income Index Growth
Portfolio Portfolio Portfolio Portfolio
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Investment Income
Interest $ 5,339,283 $ 2,652,968 $ 32,399 $ 111,293
Dividends - - 2,792,498 224,028
------------ ----------- ------------ -----------
Total investment income 5,339,283 2,652,968 2,824,897 335,321
Expenses
Investment management
fees (Note 2) 341,144 218,016 878,074 503,188
Transfer agent fees 204,548 46,432 144,537 92,767
Custody and accounting fees 17,500 18,711 6,865 9,714
Distribution expense (Note 2) 162,353 83,851 414,701 125,797
Administration expense (Note 2) 153,084 44,992 919,818 75,190
Legal and audit fees 22,190 11,574 32,018 14,524
Registration fees 31,337 13,268 25,283 16,053
Trustees' fees and expenses 8,648 8,648 8,648 8,648
Printing and postage 95,729 17,143 73,027 44,491
Dues and insurance 10,486 2,851 12,685 7,139
Shareholder services 140,133 33,348 184,866 97,232
Other expenses 29,348 12,516 17,195 15,809
Amortization of organization costs 7,145 - 7,061 -
------------ ----------- ------------ -----------
Total expenses 1,223,645 511,350 2,724,778 1,010,552
Fee reductions (Note 6) (17,500) (18,711) (6,865) (9,714)
Reimbursement by Adviser (Note 2) (94,266) - - -
------------ ----------- ------------ -----------
Net expenses 1,111,879 492,639 2,717,913 1,000,838
------------ ----------- ------------ -----------
Net investment income (loss) 4,227,404 2,160,329 106,984 (665,517)
------------ ----------- ------------ -----------
Realized and Unrealized
Gain (Loss) on Investments
Realized gain/(loss) on investments - 330,690 8,049,314 (1,434,350)
Increase in unrealized
appreciation on investments - 503,520 47,548,634 4,711,273
------------ ----------- ------------ -----------
Net realized and unrealized gain
on investments - 834,210 55,597,948 3,276,923
------------ ----------- ------------ -----------
Net increase in net assets
resulting from operations $ 4,227,404 $ 2,994,539 $ 55,704,932 $ 2,611,406
============ =========== ============ ===========
</TABLE>
See accompanying notes to financial statements. 43
<PAGE>
1997 Annual Report
Statement of Operations - Year Ended June 30, 1997
<TABLE>
<CAPTION>
Muir
California
Citizens Tax-Free
Global Equity Income
Portfolio Portfolio E*Fund(R)
--------- --------- ---------
<S> <C> <C> <C>
Investment Income
Interest $ 80,447 $ 651,878 $ 921,590
Dividends 210,234 - -
Other income (Note 2) - - 74,257
----------- ----------- -----------
Total investment income 290,681 651,878 995,847
Expenses
Investment management fees (Note 2) 206,581 78,310 17,288
Transfer agent fees 36,866 40,777 36,538
Custody and accounting fees 46,742 20,546 17,021
Distribution expense (Note 2) 51,646 30,117 -
Administration expense (Note 2) 32,743 24,668 11,805
Legal and audit fees 8,906 8,525 27,441
Registration fees 12,568 2,058 25,819
Trustees' fees and expenses 8,648 8,648 8,648
Printing and postage 17,680 19,244 27,436
Dues and insurance 2,225 989 3,191
Shareholder services 38,438 24,759 22,209
Other expenses 17,574 2,012 18,797
Amortization of organization costs - - 38,476
----------- ----------- -----------
Total expenses 480,617 260,653 254,669
Fee reductions (Note 6) (46,742) (20,546) (17,021)
Reimbursement by Adviser (Note 2) - (63,230) (237,648)
----------- ----------- -----------
Net expenses 433,875 176,877 -
----------- ----------- -----------
Net investment income (loss) (143,194) 475,001 995,847
----------- ----------- -----------
Realized and Unrealized Gain on
Investments and Foreign Currency Transactions
Realized gain on investments
and foreign currency transactions 393,718 123,431 -
Increase in unrealized
appreciation on investments
and foreign currencies 4,332,342 162,280 -
---------- ----------- -----------
Net realized and unrealized gain
on investments and foreign currencies 4,726,060 285,711 -
---------- ---------- -----------
Net increase in net assets
resulting from operations $4,582,866 $ 760,712 $ 995,847
========== =========== ===========
</TABLE>
44 See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
Citizens Trust
Statement of Changes in Net Assets
Working Assets
Money Market Portfolio Citizens Income Portfolio
---------------------- -------------------------
For the year ended June 30,
1997 1996 1997 1996
<S> <C> <C> <C> <C>
Operations
Net investment income $ 4,227,404 $4,415,160 $2,160,329 $ 1,995,790
Realized gain
on investments - - 330,690 53,207
Unrealized appreciation
(depreciation) of investments - - 503,520 (422,710)
------------ ---------- ---------- -------------
Change in net assets from
investment act 4,227,404 4,415,160 2,994,539 1,626,287
Distributions to
shareholders from:
Net investment
income - Retail (3,426,811) (4,158,569) (2,160,329) (1,995,790)
Net investment
income - Institutional (800,593) (256,591)
------------ ----------- ---------- ------------
Total distributions (4,227,404) (4,415,160) (2,160,329) (1,995,790)
Increase (decrease) in net
assets resulting from capital
share transactions (Note 5) 9,818,284 (4,746,296) 120,108 2,523,000
------------ ---------- ---------- ------------
Total increase (decrease)
in net assets 9,818,284 (4,746,296) 954,318 2,153,497
Net Assets
Beginning of year 92,865,013 97,611,309 32,275,852 30,122,355
------------ ----------- ----------- ------------
End of year $102,683,297 $92,865,013 $33,230,170 $ 32,275,852
============ =========== =========== ============
</TABLE>
See accompanying notes to financial statements. 45
<PAGE>
1997 Annual Report
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Citizens Index Portfolio Citizens Emerging Growth
------------------------ ------------------------
For the year ended June 30,
1997 1996 1997 1996
<S> <C> <C> <C> <C>
Operations
Net investment income (loss) $ 106,984 $ 884,927 ($ 665,517) ($ 321,881)
Realized gain (loss)
on investments 8,049,314 337,150 (1,434,350) 5,895,322
Unrealized appreciation
of investments 47,548,634 24,446,708 4,711,273 1,140,522
------------- ------------- ------------- -------------
Change in net assets
from investment activities 55,704,932 25,668,785 2,611,406 6,713,963
Distributions to
shareholders from:
Net investment
income - Retail (633,846) (289,938) - -
Net investment
income - Institutional (65,259) - - -
Net realized gain on
investments - Retail (971,044) (535,008) (4,391,320) (1,851,960)
------------- ------------- ------------- -------------
Net realized gain on
investments - Institutional (65,259) - - -
Total distributions (1,735,408) (824,946) (1,851,960)
Increase in net assets
resulting from capital share
transactions (Note 5) 25,643,131 13,564,332 25,711,568 20,909,575
------------- ------------- ------------- --------------
Total increase in net assets 79,612,655 38,408,171 23,931,654 25,771,578
Net Assets
Beginning of year 144,503,978 106,095,807 36,409,277 10,637,699
------------- ------------- ------------- -------------
End of year $ 224,116,633 $ 144,503,978 $ 60,340,931 $ 36,409,277
============= ============= ============= =============
Undistributed net
investment income
End of year $ 97,952 $ 690,075 - -
============= ============= ============= =============
</TABLE>
46 See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
Citizens Trust
Statement of Changes in Net Assets
Muir California
Citizens Global Equity Portfolio Tax-Free Income Portfolio
-------------------------------- -------------------------
For the year ended June 30,
1997 1996 1997 1996
<S> <C> <C> <C> <C>
Operations
Net investment
income (loss) ($ 143,194) ($ 120,143) $ 475,001 $ 578,826
Realized gain (loss)
on investments and
foreign currencies 393,718 (271,000) 123,431 175,608
Unrealized appreciation
(depreciation) of investments
and foreign currencies 4,332,342 1,867,659 162,280 (53,230)
------------ ------------ ------------ ------------
Change in net assets
from investment activities 4,582,866 1,476,516 760,712 701,204
Distributions to
shareholders from:
Net investment income - - (466,086) (578,826)
Net realized gain
on investments - (126,086) - -
------------ ------------ ------------ ------------
Total distributions - (126,086) (466,086) (578,826)
Increase (decrease)
in net assets resulting
from capital share
transactions (Note 5) 9,394,757 4,741,741 (1,638,053) (2,142,157)
------------ ------------ ------------ ------------
Total increase (decrease)
in net assets 13,977,623 6,092,171 (1,343,427) (2,019,779)
Net Assets
Beginning of year 15,595,333 9,503,162 13,221,266 15,241,045
------------ ------------ ------------ ------------
End of year $ 29,572,956 $ 15,595,333 $ 11,877,839 $ 13,221,266
Undistributed net
investment income
End of year - - $ 8,915 -
============ ============ ============ ============
</TABLE>
See accompanying notes to financial statements. 47
<PAGE>
1997 Annual Report
Statement of Changes in Net Assets
E[bullet]FUND(R)
For the year ended June 30:
1997 1996
Operations
Net income $ 995,847 $ 238,610
----------- -----------
Change in net assets from
investment activities 995,847 238,610
Distributions to
shareholders from:
Net income (995,847) (238,610)
----------- -----------
Total distributions (995,847) (238,610)
Increase in net assets
resulting from capital share
transactions (note 5) 9,620,016 11,082,222
----------- -----------
Total increase in net assets 9,620,016 11,082,222
Net Assets
Beginning of year 11,082,222 -
----------- -----------
End of year $20,702,238 $11,082,222
=========== ===========
48 See accompanying notes to financial statements.
<PAGE>
Citizens Trust
Financial Highlights
<TABLE>
<CAPTION>
Working Assets Money Market Portfolio
For the year ended June 30:
RETAIL SHARES 1997 1996 1995 1994 1993 1992
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Selected Per-Share Data
Net asset value,
beginning of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
----- ----- ----- ----- ----- -----
Income from
investment operations
Net investment income 0.042 0.045 0.044 0.023 0.024 0.041
----- ----- ----- ----- ----- -----
Less Distributions
Dividends (from net
investment income) (0.042) (0.045) (0.044) (0.023) (0.024) (0.041)
----- ----- ----- ----- ----- -----
Net asset value,
end of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
===== ===== ===== ===== ===== =====
Total return 4.30% 4.60% 4.51% 2.35% 2.43% 4.16%
Ratios and
Supplemental Data
Net assets, end of
period (thousands) $85,179 $78,326 $97,611 $103,766 $152,625 $223,951
Ratio of expenses to
average net assets 1.27% 1.21% 1.16% 1.16% 1.11% 1.07%
Ratio of expenses to
average net assets
prior to reimbursement 1.39% 1.21% 1.16% 1.16% 1.11% 1.07%
Ratio of expenses to
average net assets
net of reimbursement
and fee waivers 1.25% 1.18% 1.16% 1.16% 1.11% 1.07%
Ratio of net income to
average net assets 4.23% 4.56% 4.39% 2.31% 2.41% 4.09%
Ratio of net income to
average net assets
prior to reimbursement 4.12% 4.56% 4.39% 2.31% 2.41% 4.09%
</TABLE>
See accompanying notes to financial statements. 49
<PAGE>
1997 Annual Report
Financial Highlights
Working Assets Money Market Portfolio (Con't.)
For the year ended June 30*:
Institutional Shares 1997 1996
---- ----
Selected Per-Share Data
Net asset value, beginning of period $1.00 $1.00
----- -----
Income from investment operations
Net investment income 0.049 0.021
Less distributions
Dividends (from net investment income) (0.049) (0.021)
----- -----
Net asset value, end of period $1.00 $1.00
===== =====
Total return 5.01% 2.09%
Ratios and Supplemental Data
Net assets, end of period (thousands) $17,504 $14,539
Ratio of expenses to average net assets 0.60% 0.47%*
Ratio of expenses to average net assets
net of reimbursement and fee waivers 0.60% 0.47%*
Ratio of net income to average net assets 4.92% 5.16%*
For the period from February 1, 1996 to June 30, 1996
*Annualized
50 See accompanying notes to financial statements.
<PAGE>
Citizens Trust
Financial Highlights
<TABLE>
<CAPTION>
Citizens Income Portfolio
For the period
For the year ended June 30: ended June 30:
1997 1996 1995 1994 1993 1992+
---- ---- ---- ---- ---- -----
<S> <C> <C> <C> <C> <C> <C>
Selected Per-Share Data
Net asset value,
beginning of period $10.28 $10.38 $10.04 $10.60 $10.07 $10.00
------ ------ ------ ------ ------ ------
Income from
investment operations
Net investment income 0.67 0.66 0.65 0.55 0.46 0.01
Net gain (loss) on securities
(both realized and unrealized) 0.28 (0.10) 0.36 (0.54) 0.54 0.07
------ ------ ------ ------ ------ ------
Total from
investment operations 0.95 0.56 1.01 0.01 1.00 0.08
Less distributions
Dividends from net
investment income (0.67) (0.66) (0.65) (0.55) (0.47) (0.01)
Distributions from net
realized gains - - (0.02) (0.02) - -
------ ------ ------ ------ ------ ------
Total distributions (0.67) (0.66) (0.67) (0.57) (0.47) (0.01)
------ ------ ------ ------ ------ ------
Net asset value,
end of period $10.56 $10.28 $10.38 $10.04 $10.60 $10.07
====== ====== ====== ====== ====== ======
Total return 9.57% 5.48% 10.45% 5.04% 10.08% 14.60%*
Ratios and Supplemental Data
Net assets, end
of period (thousands) $33,230 $32,276 $30,122 $24,410 $12,601 $1,030
Ratio of expenses to
average net assets 1.47% 1.43% 1.35% 1.25% 1.42% 1.75%*
Ratio of expenses to
average net assets
prior to reimbursement 1.47% 1.48% 1.48% 2.01% 2.38% 1.75%*
Ratio of expenses to
average net assets net of
reimbursement & fee waivers 1.41% 1.38% 1.35% 1.25% 1.42% 1.75%
Ratio of net income
to average net assets 6.44% 6.26% 6.47% 5.43% 4.98% 4.38%*
Ratio of net income
to average net assets prior
to reimbursement 6.44% 6.21% 6.34% 4.68% 4.02% 4.38%*
Portfolio turnover rate 64.56% 41.36% 46.03% 52.62% 22.35% 0.00%
</TABLE>
+Commencement of operations June 10, 1992
*Annualized
See accompanying notes to financial statements. 51
<PAGE>
1997 Annual Report
Financial Highlights
<TABLE>
<CAPTION>
Citizens Index Portfolio
Retail Shares Institutional Shares
For the year For the period For the year For the period
ended June 30: ended June 30: ended June 30: ended June 30:
1997 1996 1995[dagger] 1997 1996[sec]
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Selected Per-Share Data
Net asset value,
beginning of year $13.41 $10.94 $10.00 $11.00 $10.00
------ ------ ------ ------ ------
Income from
investment operations
Net investment income - 0.08 0.01 0.08 0.08
Net gain on securities both
realized and unrealized 4.78 2.47 0.93 3.94 0.92
------ ------ ------ ------ ------
Total from
investment operations 4.78 2.55 0.94 4.02 1.00
Less distributions
Dividends from net
investment income (0.06) (0.03) - (0.09) -
Distributions from net
realized gains (0.09) (0.05) - (0.09) -
------ ------ ------ ------ ------
Total distributions (0.15) (0.08) - (0.18) -
------ ------ ------ ------ ------
Net asset value, end of period $18.04 $13.41 $10.94 $14.84 $11.00
====== ====== ====== ====== ======
Total return 35.88% 23.41% 9.40% 36.93% 10.00%
Ratios and Supplemental Data
Net assets,
end of period (thousands) $211,116 $136,980 $106,096 $13,001 $7,524
Ratio of expenses to
average net assets 1.59% 1.82% 1.75%* 0.88% 1.01%*
Ratio of expenses to
average net assets
net of reimbursement
and fee waivers 1.59% 1.79% 1.75% 0.88% 0.98%*
Ratio of net income
to average net assets 0.02% 0.68% 0.98%* 0.76% 2.37%*
Portfolio turnover rate 18.64% 6.44% 64.95% 18.64% 6.44%
Average broker commision
per share $0.0443
</TABLE>
*Annualized
[dagger]Commencement of operations March 3, 1995
[sec]Commencement of operations January 25, 1996
52 See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
Citizens Trust
Financial Highlights
Citizens Emerging Growth Portfolio
For the period
For the year ended June 30: ended June 30:
1997 1996 1995 1994[dagger]
---- ---- ---- ----
<S> <C> <C> <C> <C>
Selected Per-Share Data
Net asset value,
beginning of period $14.87 $11.87 $9.93 $10.00
------ ------ ------ ------
Income (loss) from
investment operations
Net investment income (loss) (0.16) (0.13) 0.07 0.01
Net gain (loss) on securities
(both realized and unrealized) 0.68 4.72 2.18 (0.08)
------ ------ ------ ------
Total from
investment operations 0.52 4.59 2.25 (0.07)
Less distributions
Dividends from net
investment income - - (0.09) -
Distributions from net
realized gains (1.25) (1.59) (0.22) -
------ ------ ------ ------
Total distributions (1.25) (1.59) (0.31) -
------ ------ ------ ------
Net asset value,
end of period $14.14 $14.87 $11.87 $9.93
====== ====== ====== =====
Total return 4.03% 42.43% 23.24% -1.80%*
Ratios and Supplemental Data
Net assets, end of period
(thousands) $60,341 $36,409 $10,638 $3,754
Ratio of expenses to
average net assets 2.01% 2.10% 1.90% 1.89%*
Ratio of expenses to
average net assets
prior to reimbursement .2.01% 2.34% 2.93% 3.81%*
Ratio of expenses to
average net assets
net of reimbursement
and fee waivers 1.99% 2.02% 1.90% 1.89%*
Ratio of net income (loss)
to average net assets -1.32% -1.64% 0.53% 0.63%*
Ratio of net income (loss)
to average net assets
prior to reimbursement -1.32% -1.88% -0.50% -1.29%*
Portfolio turnover rate 228.66% 337.41% 231.30% 33.35%
Average broker commision
per share $0.0222
</TABLE>
*Annualized
[dagger]Commencement of operations February 8, 1994
See accompanying notes to financial statements. 53
<PAGE>
1997 Annual Report
Financial Highlights
<TABLE>
<CAPTION>
Citizens Global Equity Portfolio
For the period
For the year ended June 30: ended June 30:
1997 1996 1995 1994[dagger]
---- ---- ---- ----
<S> <C> <C> <C> <C>
Selected Per-Share Data
Net asset value,
beginning of period $11.89 $10.69 $ 9.80 $10.00
------ ------ ------ ------
Income (loss) from
investment operations
Net investment income (loss) (0.07) (0.10) (0.01) 0.01
Net gain (loss) on securities
(both realized and unrealized) 2.65 1.43 0.96 (0.21)
------ ------ ------ ------
Total from
investment operations 2.58 1.33 0.95 (0.20)
Less distributions
Distributions from net
realized gains - (0.13) (0.06) -
------ ------ ------ ------
Total distributions - (0.13) (0.06) -
------ ------ ------ ------
Net asset value, end of period $14.47 $11.89 $10.69 $ 9.80*
------ ------ ------ ------
Total Return 21.70% 12.52% 9.77% -5.14%*
Ratios and Supplemental Data
Net assets, end of period
(thousands) $29,573 $15,595 $9,503 $5,639
Ratio of expenses to
average net assets 2.33% 2.72% 2.50% 2.50%*
Ratio of expenses to
average net assets
prior to reimbursement 2.33% 2.72% 2.99% 3.16%*
Ratio of expenses to
average net assets
net of reimbursement
and fee waivers 2.10% 1.55% 2.50% 2.50%
Ratio of net income (loss)
to average net assets -0.697% -1.01% 0.00% 0.25%
Ratio of net income (loss)
to average net assets prior
to reimbursement -0.697% -1.01% -0.49% -0.41%*
Portfolio turnover rate 69.34% 85.92% 22.10% 0.00%
Average broker commision
per share $0.0204
</TABLE>
[dagger] Commencement of operations February 8, 1994
*Annualized
54 See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
Citizens Trust
Financial Highlights
Muir California Tax-Free Income Portfolio
For the period
April 1, 1994 For the year
For the year ended June 30: to June 30 ended March 31
1997 1996 1995 1994 1994 1993
<S> <C> <C> <C> <C> <C> <C>
Selected Per-Share Data
Net asset value,
beginning of period $15.64 $15.53 $15.43 $15.71 $16.67 $15.76
------ ------ ------ ------ ------ ------
Income from
investment operations
Net investment income 0.64 0.62 0.67 0.18 0.84 0.90
Net gain on securities both
realized and unrealized 0.37 0.11 0.10 0.01 (0.79) 1.00
------ ------ ------ ------ ------ ------
Total from
investment operations 1.01 0.73 0.77 0.19 0.05 1.90
Less distributions
Dividends from net
investment income (0.62) (0.62) (0.67) (0.32) (0.86) (0.91)
Distributions from net
realized gains - - - (0.15) (0.15) (0.08)
------ ------ ------ ------ ------ ------
Total distributions (0.62) (0.62) (0.67) (0.47) (1.01) (0.99)
------ ------ ------ ------ ------ ------
Net asset value,
end of period $16.03 $15.64 $15.53 $15.43 $15.71 $16.67
====== ====== ====== ====== ====== ======
Total return 6.55% 4.71% 5.15% 5.09% *0.04% 12.58%
Ratios and Supplemental Data
Net assets, end
of period (thousands) $11,878 $13,221 $15,241 $17,276 $17,532 $15,455
Ratio of expenses to
average net assets 1.64% 1.55% 1.25% 1.25% *0.75% 0.46%
Ratio of expenses to
average net assets
prior to reimbursement 2.16% 1.87% 1.74% 1.86% *1.62% 1.87%
Ratio of expenses to
average net assets
net of reimbursement and
fee waivers 1.47% 1.45% 1.25% 1.25% *0.75% 0.46%
Ratio of net income
to average net assets 3.97% 3.98% 4.37% 4.70% *4.98% 5.59%
Ratio of net income
to average net assets
prior to reimbursement 3.44% 3.66% 3.88% 4.09% *4.11% 4.18%
Portfolio turnover rate 83.05% 83.12% 74.94% 38.29% 31.04% 36.24%
</TABLE>
*Annualized
See accompanying notes to financial statements. 55
<PAGE>
1997 Annual Report
Financial Highlights
<TABLE>
<CAPTION>
E[bullet]Fund(R)
For the year ended June 30:
1997 1996
<S> <C> <C>
Selected Per-Share Data
Net asset value,
beginning of period $1.00 $1.00
----- -----
Income from operations
Net investment income 0.057 0.059
----- -----
Less distributions
Dividends (from net
investment income) (0.057) (0.059)
----- -----
Net asset value,
end of period $1.00 $1.00
===== =====
Total return 5.90% 6.10%
Ratios and Supplemental Data
Net assets, end
of period (thousands) $20,702 $11,082
Ratio of expenses to
average net assets 0.10% 0.00%
Ratio of expenses to
average net assets
prior to reimbursement 1.47% 1.55%
Ratio of expenses to
average net assets
net of reimbursement
and fee waivers 0.00% 0.00%
Ratio of net income to
average net assets 5.76% 6.02%
Ratio of net income to
average net assets prior
to reimbursement 4.39% 4.64%
</TABLE>
56 See accompanying notes to financial statements.
<PAGE>
Citizens Trust
Notes to Financial Statements - June 30, 1997
NOTE 1 - Summary of Significant Accounting Policies
Organization
Working Assets Money Market Portfolio, Citizens Income Portfolio, Citizens Index
Portfolio, Citizens Emerging Growth Portfolio, Citizens Global Equity Portfolio,
Muir California Tax-Free Income Portfolio and the E[bullet]fund (the
"Portfolios") are each a series of shares of beneficial interest of Citizens
Investment Trust ("Citizens Trust" or the "Trust"). The Trust is registered as
an open-end management company under the Investment Company Act of 1940, as
amended (the "1940 Act"). The Trust was organized as a Massachusetts business
trust on November 24, 1982, and is authorized to issue an unlimited number of no
par value shares in one or more series and one or more classes within the
series. The following is a summary of significant accounting policies followed
by the Portfolios.
Primary Objectives of Portfolios
Working Assets Money Market Portfolio and the E[bullet]fund(R) - current
income consistent with safety and liquidity.
Citizens Income Portfolio - invests in fixed income securities to generate
current income and pay a dividend every month.
Citizens Index Portfolio - market-weighted portfolio of 300 companies with the
objective of long-term capital appreciation.
Citizens Emerging Growth Portfolio - invests in promising small and medium sized
companies with the objective of aggressive growth.
Citizens Global Equity Portfolio - Holds U.S. and foreign stocks for capital
appreciation.
Muir California Tax-free Income Portfolio - provides a high level of current
income exempt from both federal and California state personal income tax.
Security Valuation
Working Assets Money Market Portfolio's and the E[bullet]fund's securities are
valued at amortized cost (premiums and discounts are amortized on a
straight-line basis), which has been determined by the Board of Trustees to
represent fair value. With respect to the other Portfolios, securities for which
market quotations are readily available are valued at the most recent closing
sale price or, if there is no closing sale price, at the bid price except for
municipal bonds which are valued at the mean between the bid and asked price.
Fixed income securities maturing within sixty days are normally valued at cost,
plus or minus any amortized discount or premium, provided that the Board of
Trustees determines that amortized cost equals market value. All securities for
which market quotations are not readily available will be fairly valued by
Citizens Advisers, the Trust's adviser, in good faith under the supervision of
the Board of Trustees.
The Muir California Tax-Free Income Portfolio invests in debt instruments of
municipal issuers. The issuers' abilities to meet their obligations may be
affected by economic developments in the state of California.
Security Transactions, Investment Income and Other
Security transactions are recorded on the trade date. Interest income is
recorded on an accrual basis. Dividend income and distributions to shareholders
are recorded on the ex-dividend date. Realized gains and losses are recorded on
the identified cost basis. The Money Market Portfolio and the E[bullet]fund seek
to maintain a continuous net asset value per share of $1.00 and intend to comply
with the maturity, diversification and quality requirements of Rule 2a-7 under
the 1940 Act in order to be considered a money market fund. If net asset value
per share using available market information deviates from $1.00 by $.005 or
more, the Board of Trustees would consider what steps, if any, should be taken
to restore net asset value per share to $1.00.
57
<PAGE>
1997 Annual Report
Notes to Financial Statements--June 30, 1997
Call and Put Options
Citizens Emerging Growth Portfolio, Citizens Global Equity Portfolio, Citizens
Index Portfolio and Muir California Tax-Free Income Portfolio - When a Portfolio
writes a call or put option, an amount equal to the premium received is
reflected as a liability. The amount of the liability is subsequently "marked to
market" to reflect the current market value of the option written. If an option
which a Portfolio has written either expires on its stipulated expiration date,
or if the Portfolio enters into a closing purchase transaction, the Portfolio
realizes a gain (or loss if the cost of the closing transaction exceeds the
premium received when the option is sold), and the liability related to such
option is extinguished. If a call option which a Portfolio has written is
exercised, the Portfolio realizes a gain or loss from the sale of the underlying
security and the proceeds from such sale are increased by the premium originally
received. If a put option which a Portfolio has written is exercised, the amount
of the premium originally received reduces the cost of the security which the
Portfolio purchases upon exercise of the options.
The premium paid by a Portfolio for the purchase of a call or put option is
recorded as an investment and subsequently "marked to market" to reflect the
current market value of the option purchased. If an option which a Portfolio has
purchased expires on the stipulated expiration date, the Portfolio realizes a
loss in the amount of the cost of the option. If a Portfolio enters into a
closing transaction, it realizes a gain (loss) if the proceeds from the sale are
greater (less) than the cost of the option purchased. If a Portfolio exercises a
put option, it realizes a gain or loss from the sale of the underlying security
and the proceeds from such sale will be decreased by the premium originally
paid. If a Portfolio exercises a call option, the cost of the security purchased
upon exercise is increased by the premium originally paid. These option
contracts may be listed for trading on a national securities exchange or traded
over-the-counter. Over-the-counter options are transacted directly with dealers
and not with a clearing corporation, and there is a risk of nonperformance by
the dealer. A Portfolio as writer of a call option, loses the potential for gain
on the underlying security above the exercise price while the option is
outstanding. By writing a put option, a Portfolio might become obligated to
purchase the underlying security at an exercise price that exceeds the then
current market price.
Distributions
Citizens Income Portfolio distributes net investment income to shareholders
monthly and net capital gains, if any, annually. With respect to Citizens Index
Portfolio, Citizens Emerging Growth Portfolio and Citizens Global Equity
Portfolio, distributions to shareholders from net investment income and net
capital gains, if any, are distributed annually. With respect to the Working
Assets Money Market Portfolio, E[bullet]fund and the Muir California Tax-Free
Income Portfolio, dividends from net investment income are accrued daily and are
reinvested in additional shares or paid in cash monthly. Income distributions
and capital gain distributions are determined in accordance with income tax
regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments for net operating
losses and deferral of post-October losses.
Federal Income Taxes
No provision has been made for federal taxes on the Portfolios' income since it
is the policy of the Portfolios to comply with the provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute all
of their taxable income to their shareholders.
Deferred Organization Costs
All costs incurred in connection with the organization, registration and/or
reorganization of the Portfolios have been paid by the Portfolios. These costs
are being amortized on a straight line basis over a period not to exceed sixty
months.
58
<PAGE>
Citizens Trust
Notes to Financial Statements-June 30, 1997
Use of Estimates in Financial Statements
In preparing financial statements in conformity with generally accepted
accounting principles, management makes estimates and assumptions that affect
the reported amounts of assets and liabilities at the date of the financial
statements, as well as the reported amounts of income and expenses during the
period. Actual results may differ from these estimates.
NOTE 2 - Investment Advisory Fee and Other Transactions with Affiliates
Citizens Advisers (the "Adviser") serves as Adviser to each of the Portfolios.
Citizens Securities (the "Distributor"), is a wholly owned subsidiary of the
Adviser and serves as the Distributor of each of the Portfolios' shares. Under
the terms of the management contract, the Adviser is paid a monthly fee based on
an annual rate of each Portfolio's average net assets. Those rates are a
follows: Working Assets Money Market Portfolio, .35%; Citizens Income Portfolio
and Muir California Tax-Free Income Portfolio, .65%; Citizens Index Portfolio,
.50%; Citizens Emerging Growth Portfolio and Citizens Global Equity Portfolio,
1.00%; and E[bullet]fund .10%. The Adviser has agreed to reduce or eliminate its
fee to the extent that the total expenses of a Portfolio for any fiscal year
(exclusive of taxes, interest, brokerage commissions and extraordinary expenses)
exceed the following limits: Working Assets Money Market Portfolio, 1.50% of the
first $40 million of average net assets and 1% thereafter; Citizens Income
Portfolio, 1.75% of the first $75 million of average net assets and 1.25%
thereafter; Citizens Emerging Growth Portfolio, Citizens Global Equity Portfolio
and Muir California Tax-Free Income Portfolio, 2.10%, 2.50% and 1.50%,
respectively, of average net assets. The Adviser may also voluntarily reduce its
fee or waive reimbursement of distribution costs so that the total expenses of a
Portfolio are below such limits. The Adviser is currently waiving all expenses
of the E[bullet]fund. Such voluntary reimbursements may cease at any time.
Reimbursements for the period ended June 30, 1997, were $94,266, $63,230 and
$237,648 for the Working Assets Money Market Portfolio, Muir California Tax-Free
Income Portfolio and E[bullet]fund, respectively.
GMG/Seneca Capital Management serves as the Sub-Adviser for Working Assets Money
Market Portfolio, Citizens Income Portfolio, Citizens Emerging Growth Portfolio,
Muir California Tax-Free Income Portfolio and E[bullet]fund. Clemente Capital,
Inc. serves as the Sub-Adviser for Citizens Global Equity Portfolio and
RhumbLine Advisers serves as the Sub-Adviser for Citizens Index Portfolio. For
their services, the Sub-Advisers receive fees, paid by the Adviser as follows:
<TABLE>
<CAPTION>
Percent of Percent of
average management
net assets fee paid Adviser
<S> <C> <C>
Money Market Portfolio .08% -
E[bullet]fund .08% -
Income Portfolio .165% -
Index Portfolio .10% -
Emerging Growth Portfolio .0- 35%
Global Equity Portfolio .35% -
Muir California Tax-Free Portfolio .175% -
</TABLE>
The Trust's distribution agreement allows the Distributor to be reimbursed for
distribution-related expenses up to .20% of the average daily net assets of the
Working Assets Money Market Portfolio and up to .25% of the average daily net
assets of the other Portfolios, with the exception of the E[bullet]Fund and the
Institutional Classes of the Money Market Portfolio and the Citizens Index
Portfolio, which have no distribution-related expenses.
Pursuant to an Administrative Services Agreement, the Adviser assumes a number
of general administrative services for each Portfolio for which the Adviser is
paid a monthly fee based on an annual rate of each Portfolio's average net
assets. Those rates are as follows: Working Assets Money Market
59
<PAGE>
1997 Annual Report
Notes to Financial Statements
Portfolio - Retail Class - .15%; Citizens Income Portfolio, Citizens Emerging
Growth Portfolio, Citizens Global Equity Portfolio and Muir California Tax-Free
Income Portfolio - .10%; and Citizens Index Portfolio - Retail Class - .50%.
Shareholders of the E[bullet]fund are issued Mastercard debit cards. The
Distributor collects and forwards to the Portfolio 1% of the amount of debit
card purchases, subject to the limit that the amounts paid the Portfolio,
together with any other "non-qualifying" income received by the Portfolio in any
fiscal year will not exceed 9.75% for the Portfolio's gross income for that
year.
Certain officers and trustees of the Trust are "affiliated persons," as defined
in the 1940 Act, of the Adviser. Currently, each Trustee who is not an
"affiliated person" receives an annual retainer of $6,000 and $1,000 for each
day's attendance of a trustee's meeting.
NOTE 3 - Investment Securities
Purchases of investments, other than short-term securities, aggregated
$20,876,585, $56,271,949, $130,997,072, $19,703,967 and $9,591,197 for the
Citizens Income Portfolio, Citizens Index Portfolio, Citizens Emerging Growth
Portfolio, Citizens Global Equity Portfolio and Muir California Tax-Free Income
Portfolio, respectively, for the period ended June 30, 1997. Sales of
investments, other than short-term securities, aggregated $21,454,514,
$32,602,780, $100,048,921, $12,286,546 and $11,365,925 for the Citizens Income
Portfolio, Citizens Index Portfolio, Citizens Emerging Growth Portfolio,
Citizens Global Equity Portfolio and Muir California Tax-Free Income Portfolio,
respectively, for the period ended June 30, 1997.
The amount of unrealized appreciation (depreciation) of investments as of June
30, 1997, is as follows:
<TABLE>
<CAPTION>
Muir
California
Tax Free
Emerging Global Tax-Equity
Income Index Growth Equity Income
Portfolio Portfolio Portfolio Portfolio Portfolio
<S> <C> <C> <C> <C> <C>
Gross Appreciation $511,511 $79,117,972 $7,005,654 $6,937,715 $255,257
Gross Depreciation (146,046) (3,276,315) (463,365) (190,339) (40,527)
-------- ----------- ---------- ---------- --------
Net Appreciation $365,465 $75,841,655 $6,542,289 $6,747,376 $214,730
</TABLE>
Investments have the same cost for tax and financial statement purposes.
NOTE 4 - Restricted Securities
On June 30, 1997, the Citizens Index Portfolio held restricted securities (i.e.,
securities which may not be publicly sold without registration under the
Securities Act of 1933 ( the "1933 Act") or without an exemption under the 1933
Act). These securities are valued at fair value as determined by the Board of
Trustees. On June 30, 1997, and on the acquisition dates of the restricted
securities, there were no market quotations available for unrestricted
securities of the same class. Dates of acquisition and costs of restricted
securities are as follows:
Date of
Acquisition Cost
Energia Global,
Series A Conv. Pfd. April 1, 1993 $250,000
Vulcan Power Co.,
Class A June 1, 1993 300,000
--------
Total $550,000
At June 30, 1997, the cost and market value of Energia Global were the same.
Vulcan Power had no market value on June 30, 1997. Total restricted securities
represented 0.11% of net assets.
60
<PAGE>
Citizens Trust
Notes to Financial Statements-June 30, 1997
NOTE 5 - Capital Shares
Transactions in capital stock were as follows:
Working Assets Money Market Portfolio
<TABLE>
<CAPTION>
Retail Class Retail Class
Year Ended 6/30/97 Year Ended 6/30/96
Shares Value Shares Value
<S> <C> <C> <C> <C>
Shares sold 112,553,683 $112,553,683 89,524,066 $89,524,066
Shares redeemed (109,064,955) (109,064,955) (112,854,324) (112,854,324)
Shares issued in
reinvestment of
distributions 3,364,638 3,364,638 4,044,997 4,044,997
----------- ------------ ------------ -------------
Net increase
(decrease) 6,853,366 $6,853,366 (19,285,261) ($19,285,261)
</TABLE>
<TABLE>
<CAPTION>
Institutional Class Institutional Class
Year Ended 6/30/97 Year Ended 6/30/96
Shares Value Shares Value
<S> <C> <C> <C> <C>
Shares sold 13,951,439 $13,951,439 18,169,824 $18,169,824
Shares redeemed (11,780,996) (11,780,996) (3,884,469) (3,884,469)
Shares issued in
reinvestment of
distributions 794,475 794,475 253,610 253,610
----------- ----------- ---------- -----------
Net increase
(decrease) 2,964,918 $2,964,918 14,538,965 $14,538,965
</TABLE>
<TABLE>
<CAPTION>
Citizens Income Portfolio
Year Ended 6/30/97 Year Ended 6/30/96
Shares Value Shares Value
<S> <C> <C> <C> <C>
Shares sold 838,253 $8,769,851 960,101 $10,068,858
Shares redeemed (1,003,548) (10,461,769) (888,785) (9,292,285)
Shares issued in
reinvestment of
distributions 173,608 1,812,026 167,102 1,746,427
---------- ---------- ---------- -----------
Net increase 8,313 $120,108 238,418 $2,523,000
</TABLE>
<TABLE>
<CAPTION>
Citizens Index Portfolio
Retail Class Retail Class
Year Ended 6/30/97 Year Ended 6/30/96
Shares Value Shares Value
<S> <C> <C> <C> <C>
Shares sold 2,973,987 $45,828,710 2,251,655 $27,976,155
Shares redeemed (1,591,178) (24,219,385) (1,805,346) (22,418,230)
Shares issued in
reinvestment of
distributions 105,816 1,574,541 66,739 808,873
---------- ----------- ---------- -----------
Net increase 1,488,625 $23,183,866 513,048 $6,366,798
</TABLE>
61
<PAGE>
1997 Annual Report
Notes to Financial Statements-June 30, 1997
<TABLE>
<CAPTION>
Citizens Index Portfolio (Con't.)
Institutional Class Institutional Class
Year Ended 6/30/97 Year Ended 6/30/96
Shares Value Shares Value
<S> <C> <C> <C> <C>
Shares sold 291,398 $3,682,414 687,394 $7,237,544
Shares redeemed (109,750) (1,348,908) (3,661) (40,010)
Shares issued in
reinvestment of
distributions 10,317 125,759 - -
--------- ---------- ------- ----------
Net increase 191,965 $2,459,265 683,733 $7,197,534
</TABLE>
<TABLE>
<CAPTION>
Citizens Emerging Growth Portfolio
Year Ended 6/30/97 Year Ended 6/30/96
Shares Value Shares Value
<S> <C> <C> <C> <C>
Shares sold 5,552,259 $76,934,885 1,982,405 $27,359,334
Shares redeemed
(4,052,228) (55,472,753) (584,334) (8,250,469)
Shares issued in
reinvestment of
distributions 319,747 4,249,436 154,700 1,800,710
---------- ----------- ---------- -----------
Net increase $1,819,778 $25,711,568 1,552,771 $20,909,575
</TABLE>
<TABLE>
<CAPTION>
Citizens Global Equity Portfolio
Year Ended 6/30/97 Year Ended 6/30/96
Shares Value Shares Value
<S> <C> <C> <C> <C>
Shares sold 982,862 $12,555,317 568,325 $6,383,820
Shares redeemed (249,910) (3,160,560) (157,671) (1,763,879)
Shares issued in
reinvestment of
distributions - - 11,437 121,800
-------- ----------- -------- -----------
Net increase
(decrease) 732,952 $9,394,757 422,091 $4,741,741
</TABLE>
<TABLE>
<CAPTION>
Muir California Tax-Free Income Portfolio
Year Ended 6/30/97Year Ended 6/30/96
Shares Value Shares Value
<S> <C> <C> <C> <C>
Shares sold 96,462 $1,539,633 58,015 $915,810
Shares redeemed (225,842) (3,578,453) (224,461) (3,534,455)
Shares issued in
reinvestment of
distributions 25,252 400,767 30,073 476,088
-------- ----------- -------- -----------
Net increase
(decrease) (104,128) ($1,638,053) (136,373) ($2,142,557)
</TABLE>
<TABLE>
<CAPTION>
E[bullet]fund
Year Ended 6/30/97 Year Ended 6/30/96
Shares Value Shares Value
<S> <C> <C> <C> <C>
Shares sold 65,756,652 $65,756,652 19,817,895 $19,817,895
Shares redeemed (57,122,135) (57,122,135) (8,955,215) (8,955,215)
Shares issued in
reinvestment of
distributions 985,499 985,499 219,542 219,542
--------- ---------- ---------- -----------
Net increase 9,620,016 $9,620,016 11,082,222 $11,082,222
</TABLE>
62
<PAGE>
Citizens Trust
Report of Independent Certified Public Accountants
NOTE 6 - Custody of Securities
Under an agreement with the Custodian Bank, custody fees are reduced by
credits for credits for cash balances. Such reductions totaled $137,098 and
$143,915 for the Trust during the years ended June 30, 1997 and 1996,
respectively.
To the Shareholders and Trustees of
Citizens Investment Trust
We have audited the accompanying statements of assets and liabilities of Working
Assets Money Market Portfolio, Citizens Income Portfolio, Citizens Emerging
Growth Portfolio, Citizens Global Equity Portfolio, Muir California Tax-Free
Income Portfolio and the E[bullet]fund, each a series of shares of beneficial
interest of Citizens Investment Trust, formerly Working Assets Common Holdings,
including the statements of investments, as of June 30, 1997 and the related
statements of operations for the year then ended, the statements of changes in
net assets for the periods indicated thereon, and the financial highlights for
the periods indicated thereon. 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.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material mis-statement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of June 30, 1997, 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 presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Working Assets Money Market Portfolio, Citizens Income Portfolio, Citizens
Emerging Growth Portfolio, Citizens Global Equity Portfolio, Muir California
Tax-Free Income Portfolio and the E[bullet]fund as of June 30, 1997, the results
of their operations for the year then ended, the changes in their net assets for
the periods referred to above, and their financial highlights for the periods
referred to above, in conformity with generally accepted accounting principles.
TAIT, WELLER & BAKER
Philadelphia, Pennsylvania
July 25, 1997
63
<PAGE>
1997 Annual Report
This page intentionally left blank.
64
<PAGE>
1997 Annual Report Service Providers:
Distributor
Citizens Securities
One Harbour Place, Portsmouth, NH 03801
800-223-7010 [bullet] 603-436-5152
Manager
Citizens Advisers
One Harbour Place, Portsmouth, NH 03801
800-223-7010
Trustees
Azie Taylor Morton, Chair; William D. Glenn II; Sophia Collier;
Lokelani Devone; Juliana Eades; J.D. Nelson; Ada Sanchez
Custodian
State Street Bank and Trust Company
Boston, MA
Transfer Agent & Dividend Disbursing Agent
PFPC Inc.
Wilmington, DE
Legal Counsel
Bingham, Dana & Gould, LLP
Boston, MA
Independent Auditors
Tait, Weller & Baker
Philadelphia, PA
World Wide Web Address: http://www.efund.com
[Copy Right]1997 Citizens Advisers
Printed on recycled paper using soy-based inks.
<PAGE>
[Block logo] Citizens Trust [Trademark]
One Harbour Place
Suite 525
Portsmouth, New Hampshire
03801
Bulk Rate
U.S. Postge Paid
Nashua, NH
Permit #375
