<PAGE>
THE STRONG [PIE CHART OF ASSET
GROWTH FUNDS DIVERSIFICATION
EMPHASIZING STOCKS]
SEMI-ANNUAL REPORT o JUNE 30, 1997
THE STRONG VALUE FUND
----------------------------
THE STRONG OPPORTUNITY FUND
----------------------------
THE STRONG MID CAP FUND
----------------------------
THE STRONG COMMON STOCK FUND
----------------------------
THE STRONG GROWTH FUND
----------------------------
THE STRONG DISCOVERY FUND
----------------------------
THE STRONG SMALL CAP FUND
[STRONG LOGO]
STRONG FUNDS
<PAGE>
EIGHT BASIC PRINCIPLES FOR SUCCESSFUL MUTUAL FUND INVESTING
These common-sense rules are followed by many successful investors. They make
sense for beginners, too. If you have a question on these principles, or would
like to discuss them with us, please contact us at 1-800-368-3863. We're here 24
hours a day, seven days a week to take your call.
- --------------------------------------------------------------------------------
[PICTURE OF FOLDER LABELED INVESTMENTS]
1. HAVE A PLAN. Even a simple plan can help you take control of your financial
future. Review your plan once a year, or if your circumstances change.
- --------------------------------------------------------------------------------
[PICTURE OF CLOCK]
2. START INVESTING AS SOON AS POSSIBLE. Make time a valuable ally. Let it put
the power of compounding to work for you, while helping to reduce your potential
investment risk.
- --------------------------------------------------------------------------------
[PICTURE OF PIE CHART OF ASSET DIVERSIFICATION]
3. DIVERSIFY YOUR PORTFOLIO. By investing in different asset classes - stocks,
bonds, and cash - you help protect against poor performance in one type of
investment while including investments most likely to help you achieve your
important goals.
- --------------------------------------------------------------------------------
[PICTURE OF MEMO REMINDER TO INVEST]
4. INVEST REGULARLY. Investing is a process, not a one-time event. By investing
regularly over the long term, you reduce the impact of short-term market
gyrations, and you attend to your long-term plan before you're tempted to spend
those assets on short-term needs.
- --------------------------------------------------------------------------------
[PICTURE OF GRAPH SLOPING UPWARD]
5. MAINTAIN A LONG-TERM PERSPECTIVE. For most individuals, the best discipline
is staying invested as market conditions change. Reactive, emotional investment
decisions are all too often a source of regret - and of principal loss.
- --------------------------------------------------------------------------------
[PICTURE OF PIE CHART OF ASSET DIVERSIFICATION EMPHASIZING STOCKS]
6. CONSIDER STOCKS TO HELP ACHIEVE MAJOR LONG-TERM GOALS. Over time, stocks have
provided the more powerful returns needed to help the value of your investments
stay well ahead of inflation.
- --------------------------------------------------------------------------------
[PICTURE OF DOLLAR SIGN]
7. KEEP A COMFORTABLE AMOUNT OF CASH IN YOUR PORTFOLIO. To meet current needs,
including emergencies, use a money market fund or a bank account - not your
long-term investment assets.
- --------------------------------------------------------------------------------
[PICTURE OF MAGNIFYING GLASS]
8. KNOW WHAT YOU'RE BUYING. Make sure you understand the potential risks and
rewards associated with each of your investments. Ask questions...request
information...make up your own mind. And choose a fund company that helps you
make informed investment decisions.
<PAGE>
THE STRONG
GROWTH FUNDS
SEMI-ANNUAL REPORT o JUNE 30, 1997
TABLE OF CONTENTS
INVESTMENT REVIEWS
The Strong Value Fund ................................................2
The Strong Opportunity Fund ..........................................4
The Strong Mid Cap Fund ..............................................6
The Strong Common Stock Fund .........................................8
The Strong Growth Fund ..............................................10
The Strong Discovery Fund ...........................................12
The Strong Small Cap Fund ...........................................14
FINANCIAL INFORMATION
Schedules of Investments in Securities
The Strong Value Fund ...........................................16
The Strong Opportunity Fund .....................................17
The Strong Mid Cap Fund .........................................19
The Strong Common Stock Fund ....................................21
The Strong Growth Fund ..........................................23
The Strong Discovery Fund .......................................25
The Strong Small Cap Fund .......................................27
Statements of Assets and Liabilities ................................30
Statements of Operations ............................................31
Statements of Changes in Net Assets .................................32
Notes to Financial Statements .......................................34
FINANCIAL HIGHLIGHTS .....................................................37
<PAGE>
THE STRONG VALUE FUND
WE'VE BEEN BOOSTING OUR POSITION IN FINANCIALS, GIVING US GREATER EXPOSURE TO AN
INDUSTRY THAT IS POSITIONED TO BENEFIT FROM THE CURRENT ECONOMIC CLIMATE.
The Strong Value Fund seeks capital growth. The Fund invests primarily in equity
securities, seeking through fundamental analysis those companies whose share
prices do not fully reflect their value, or companies that are selling at a
discount relative to their historical price or to other companies in the same
industry.
To identify value, our research team looks for catalysts--such as management
changes, corporate restructurings, or underlying shifts in a particular
industry--that we believe may signal a resurgence in the stock's price or
earnings.
The Fund may invest in companies of any size, but it currently emphasizes
medium- and large-size firms.
========================================
ASSET ALLOCATION
Based on net assets as of 6-30-97
========================================
[PIE CHART]
Stocks 87.0%
Short-Term Investments 13.0%
========================================
LARGE GROWTH STOCKS CONTINUE TO LEAD THE WAY
The markets made a record upward drive over the past six months, interrupted
only by a hiccup in late March and early April when the Fed's interest-rate
hike temporarily raised fears of rising inflation and interest rates. Growth
stocks--particularly the largest, priciest companies-- dominated the market,
while smaller companies and value stocks of all sizes lagged considerably.
This market clearly presented challenges given our investment discipline. For
the six months ended June 30, the Fund returned 12.48%, while the Russell 1000
Value Index returned 17.68%.*(1) It has been difficult to find compelling
values, and we have added few new issues in recent months. When we have found
stocks at attractive values, they have tended to be among companies that are
restructuring or going through management changes. These include Providian
Financial and ADT (which recently merged with Tyco International).
====================================================
TOP FIVE INDUSTRIES
As of 6-30-97
====================================================
INDUSTRY % OF NET ASSETS
- ---------------------------------------------------
Media-Radio/TV 4.7%
...................................................
Diversified Operations 4.5%
...................................................
Telecommunication Service 4.0%
...................................................
Commercial Service 3.5%
...................................................
Finance-Miscellaneous 3.4%
...................................................
Please see the Schedule of Investments in
Securities for a complete listing of the
Fund's portfolio.
====================================================
THE CURRENT ENVIRONMENT
Trends driving the economy and the market include rising productivity, global
competition, strong corporate profits, and low inflation. Technology has changed
information flows for companies. Information regarding sales, inventory levels,
and capacity changes--whether on a global or local level--are relayed
instantaneously, helping manufacturers and retailers to avoid overstocking and
shortages. Even though the Fund does not generally invest directly in technology
stocks (in an effort to manage volatility), we do look for firms that can
benefit from technological innovations.
Global competition, combined with productivity and technology gains, has helped
to maintain low inflation. Also giving a boost to the environment for stock
investing is the imbalance between the demand and supply of equities. Further
supporting the market is a stable political environment. The Clinton
administration and Congress have been fiscally prudent, giving comfort to the
capital markets.
HOW THE ENVIRONMENT AFFECTS OUR CHOICES
In this economy of low inflation, low unemployment, and high consumer
confidence, consumer spending has risen only moderately. Following this trend,
we have been slowly de-emphasizing the consumer sector, particularly retailers.
In addition, we've been boosting our position in financials, giving us greater
exposure to an industry that is positioned to benefit from the current economic
climate.
================================================================================
FIVE LARGEST STOCK HOLDINGS
As of 6-30-97
================================================================================
% OF NET
SECURITY INDUSTRY ASSETS
- --------------------------------------------------------------------------------
Fluor Corporation Engineering and Construction 3.2%
................................................................................
Ford Motor Company Automobile 2.8%
................................................................................
Vornado Realty Trust Real Estate 2.5%
................................................................................
Duke Power Company Electric Power 2.2%
................................................................................
CNF Transportation, Inc. Trucking 2.1%
................................................................................
Please see the Schedule of Investments in Securities for a complete listing of
the Fund's portfolio.
================================================================================
2
<PAGE>
CONTINUING WITH OUR VALUE-STOCK DISCIPLINE
Our discipline is to buy stocks near the low end of their valuation range, and
sell them as they reach the upper end. Several stocks, including TIG Holdings
and Kimberly Clark, were sold out of the Fund for precisely this reason. In
addition, we sell stocks that fail to meet our expectations for improvement, and
thus no longer represent a good value. Although our approach cannot insulate the
Fund entirely from any downturns, it does help the Fund to avoid some of the
market's widest swings.
Our investment approach has kept us from fully participating in the recent
large-cap growth-driven bull market. In sticking with our investment criteria
and price discipline, however, we're maintaining a strategy that we believe can
deliver strong returns over the long term while managing risk effectively.
OUTLOOK
We do not anticipate much change in the near term environment which, while
positive, can make it difficult to find stocks at attractive valuations.
Investors' optimistic assumptions have largely been factored into stock prices.
Nonetheless, with much of the market at near record levels, there's plenty of
room for downside movement, whether the cause be a series of earnings reports
below expectations or some other negative piece of short-term news. As in the
past, we would view such volatility as an opportunity to buy high-quality
companies whose prices have fallen to attractive levels.
Thank you for your investment in the Strong Value Fund. We appreciate your
confidence, and look forward to helping you pursue your long-term growth goals.
Sincerely,
/s/ Laura J. Sloate
Laura J. Sloate
/s/ Jeffrey B Cohen
Jeffrey B. Cohen
Portfolio Managers
[PHOTO OF LAURA J. SLOATE & JEFFREY B. COHEN]
================================================================================
GROWTH OF AN ASSUMED $10,000 INVESTMENT
From 12-29-95 to 6-30-97
================================================================================
[GRAPH]
Lipper Growth
THE STRONG S & P 500 and Income
VALUE FUND Stock Index* Funds Index*
12-95 10,000 10,000 10,000
3-96 10,869 10,536 10,574
6-96 11,073 11,009 10,845
9-96 11,187 11,349 11,195
12-96 11,681 12,295 12,068
3-97 11,753 12,625 12,271
6-97 13,140 14,830 13,992
This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with similar investments in the
Standard & Poor's 500 Stock Index ("S&P 500") and the Lipper Growth and Income
Funds Index. Results include the reinvestment of dividends and capital gains
distributions. Performance is historical and does not represent future results.
Investment returns and principal value vary, and you may have a gain or loss
when you sell shares.
================================================
AVERAGE ANNUAL
TOTAL RETURNS(1)
As of 6-30-97
================================================
1-YEAR 18.67%
SINCE INCEPTION 19.97%
(on 12-29-95)
================================================
- --------------------------------------------------------------------------------
* The Russell 1000 Value Index is an unmanaged index that contains securities
from the Russell 1000 Index with a less-than-average growth orientation.
The S&P 500 is an unmanaged index generally representative of the U.S.
stock market, without regard to company size. The Lipper Growth and Income
Funds Index is an equally-weighted performance index of the largest
qualifying funds in this Lipper category. Source of the S&P and the Russell
index data is Micropal. Source of the Lipper index data is Lipper
Analytical Services, Inc.
1 Average annual total return and total return measure change in the value of
an investment in the Fund, assuming reinvestment of all dividends and
capital gains. Average annual total return reflects annualized change,
while total return reflects aggregate change.
3
<PAGE>
THE STRONG OPPORTUNITY FUND
THIS FUND IS POSITIONED TO DO WELL WHEN SOFTNESS HITS THE MARKET'S CURRENT
LEADERS, AND CONTINUE TO KEEP PACE IN A HEALTHY MARKET ENVIRONMENT.
The Strong Opportunity Fund seeks capital growth. The Fund invests at least 70%
of its net assets in equity securities, emphasizing small companies that the
Fund's Advisor believes are under-researched and attractively valued.
For the six months ended June 30, the market was very strong, but it was also
narrow, with the bulk of the S&P 500's returns coming from 10 to 12 of its
largest stocks. Most of the market posted modest returns, and even losses.
Nonetheless, we were able to deliver a return of 9.60% for the six months,
compared with the S&P 500's 20.61% return and the S&P MidCap 400's 12.99%.*(1)
========================================
ASSET ALLOCATION
Based on net assets as of 6-30-97
========================================
[PIE CHART]
Stocks 92.0%
Short-Term Investments 8.0%
========================================
====================================================
TOP FIVE SECTORS
As of 6-30-97
====================================================
SECTOR % OF NET ASSETS
- ----------------------------------------------------
Technology 21.0%
....................................................
Financial 14.0%
....................................................
Energy 11.9%
....................................................
Consumer Cyclical 8.4%
....................................................
Basic Material 7.8%
....................................................
Please see the Schedule of Investments in Securities
for a complete listing of the Fund's portfolio.
====================================================
AN UNUSUAL MARKET
The market has been an aberration, in that it's been driven by just a few
stocks. Momentum has played a much larger role in many stocks' performance than
their underlying fundamentals. Investors in this narrow group of stocks could be
paying more than what the companies are worth--and that's different from what we
try to do with the Opportunity Fund.
Our private value approach to investing means that we look at stocks as if we
were considering buying the entire company--and then compare the price we'd be
willing to pay with the current stock price. The current market, marked by high
demand for equity securities in general, makes it harder to find underfollowed,
undervalued stocks as you move up the market-capitalization ladder. That
presents a challenge for the Opportunity Fund, which focuses on mid-cap stocks
as well as smaller companies.
SPECIFIC AREAS OF FOCUS HAVE WORKED WELL
Although the momentum for larger companies predominated for most of the past six
months, there has been some broadening out in the market recently. For example,
small-cap stocks experienced some strength in May. Much of the small-cap market
had been so beaten down that they enjoyed a rebound. The portfolio benefited
from this rally because few of our smaller stocks had been battered--so their
increases in the May upturn weren't offset by an earlier decline.
Our significant overweighting in media stocks has begun to pay off. Our picks in
this sector did well in May and June, on the heels of Microsoft's announcement
that it would invest $1 billion in cable television operations. The position
we've built up in foreign stocks has also performed well.
We have built a long record of success based on a discipline of looking for
opportunities in underfollowed sectors and buying stocks cheaply. This has been
a good strategy over the long term, but of late it has presented opportunity
costs as the market's attention has fled toward the largest, best-known
companies. We're not going to change a proven strategy because of a narrowly
focused market, however. As the correction in late March and early April showed,
markets can change quickly. This Fund is positioned to do well when softness
hits the market's current leaders, and continue to keep pace in a healthy market
environment.
================================================================================
FIVE LARGEST STOCK HOLDINGS
As of 6-30-97
================================================================================
% OF NET
SECURITY INDUSTRY ASSETS
- --------------------------------------------------------------------------------
Comcast Corporation Media-Radio/TV 1.9%
Class A
................................................................................
McKesson Corporation Healthcare-Medical Supply 1.6%
................................................................................
Cabot Corporation Chemical-Specialty 1.6%
................................................................................
Sybron International Healthcare-Medical Supply 1.5%
Corporation
................................................................................
NIPSCO Industries, Inc. Electric Power 1.5%
................................................................................
Please see the Schedule of Investments in Securities for a complete listing of
the Fund's portfolio.
================================================================================
4
<PAGE>
OUTLOOK
Currently, the market is enjoying the best of all worlds. The domestic economy
is strong, inflation is low, and favorable conditions reign in most foreign
markets. With such a positive environment, if the market were ever to be at a
high, it would be now. Investors really shouldn't focus on whether the market is
too high; rather, they should think about whether the world will remain as solid
as it has been recently.
Our strategy should serve investors especially well if we experience more
challenging markets in the coming months. The portfolio has been assembled with
a strong eye toward valuations, and it focuses on quiet or ignored sectors of
the market. A market downturn would likely punish momentum-driven stocks, while
we would expect stocks out of the limelight to fare better.
We're renewing our focus on high-quality companies. At times, this may mean
paying somewhat more for a stock than we might have been willing to in the past.
This is not a shift in strategy. It's a refinement that is designed to help the
Fund prosper in the current environment. When few stocks are cheap on an
absolute basis, it's necessary to look for companies at reasonable valuations
with strong management teams and competitive positions.
Thank you for your investment in the Strong Opportunity Fund. We look forward to
helping you pursue your important financial goals.
Sincerely,
/s/Richard T. Weiss
Richard T. Weiss
/s/Marina Carlson
Marina Carlson
Portfolio Managers
[PHOTO OF RICHARD T. WEISS & MARINA CARLSON]
================================================================================
GROWTH OF AN ASSUMED $10,000 INVESTMENT
From 12-31-85 to 6-30-97
================================================================================
[GRAPH]
THE STRONG
OPPORTUNITY S & P 500 Lipper Growth
FUND Stock Index* Funds Index*
12-85 10,000 10,000 10,000
12-86 15,990 11,866 11,558
12-87 17,893 12,489 11,935
12-88 20,840 14,563 13,621
12-89 24,694 19,178 17,364
12-90 21,903 18,583 16,423
12-91 28,845 24,244 22,390
12-92 33,850 26,091 24,099
12-93 41,022 28,721 26,986
12-94 42,325 29,100 26,562
12-95 53,868 40,036 35,235
12-96 63,637 49,228 41,394
6-97 69,475 59,373 47,769
This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with similar investments in the
Standard & Poor's 500 Stock Index ("S&P 500") and the Lipper Growth Funds Index.
Results include the reinvestment of all dividends and capital gains
distributions. Performance is historical and does not represent future results.
Investment returns and principal value vary, and you may have a gain or loss
when you sell shares.
================================================================================
================================================
AVERAGE ANNUAL
TOTAL RETURNS(1)
As of 6-30-97
================================================
1-YEAR 20.34%
5-YEAR 19.40%
10-YEAR 12.90%
SINCE INCEPTION 18.40%
(on 12-31-85)
================================================
- --------------------------------------------------------------------------------
* The S&P 500 is an unmanaged index generally representative of the U.S.
stock market, without regard to company size. The S&P MidCap 400 Stock
Index is an unmanaged index generally representative of the market for the
stocks of mid-sized U.S. companies. The Lipper Growth Funds Index is an
equally-weighted performance index of the largest qualifying funds in this
Lipper category. Source of the S&P index data is Micropal. Source of the
Lipper index data is Lipper Analytical Services, Inc.
1 Average annual total return and total return measure change in the value of
an investment in the Fund, assuming reinvestment of all dividends and
capital gains. Average annual total return reflects annualized change,
while total return reflects aggregate change.
5
<PAGE>
THE STRONG MID CAP FUND
WE BELIEVE THAT THE MID-CAPITALIZATION SECTOR OF THE MARKETPLACE HAS THE
POTENTIAL TO PROVIDE INVESTORS WITH SUPERIOR RETURNS OVER TIME.
The Strong Mid Cap Fund seeks capital growth. The Fund invests primarily in
stocks of companies that have midsize market capitalizations. While these stocks
can be very volatile over short time periods, they have the potential to amply
reward investors over time.
In general, the Fund tends to invest in high-growth companies, rather than
low-priced value-style stocks. Growth companies typically offer the benefits of
talented management, strong balance sheets, healthy sales and accelerating
earnings growth.
========================================
ASSET ALLOCATION
Based on net assets as of 6-30-97
========================================
[PIE CHART]
Stocks 95.8%
Short-Term Investments 4.2%
========================================
====================================================
TOP FIVE SECTORS
As of 6-30-97
====================================================
SECTOR % OF NET ASSETS
- ----------------------------------------------------
Technology 40.6%
....................................................
Retail 12.8%
....................................................
Healthcare 12.6%
....................................................
Consumer Cyclical 7.8%
....................................................
Energy 6.9%
....................................................
Please see the Schedule of Investments in Securities
for a complete listing of the Fund's portfolio.
====================================================
MIDSIZE STOCKS HAD A DIFFICULT FIRST HALF
The Fund's underperformance in the first half of the year relative to its
benchmark, the S&P MidCap 400, reflects its growth style. The entire
mid-capitalization sector of the market-place experienced a severe correction
through the first four months of 1997, driven by fears that stronger than
expected economic growth would lead to rising inflation and interest rates. The
decline among the higher-growth, higher-priced companies in the mid-cap market
during these first four months was much deeper than the decline in the S&P
MidCap 400. The technology sector, in which the Fund is overweighted, was
particularly hard hit. As a result, the Fund's return of 1.04% for the six
months lagged the S&P MidCap 400's gain of 12.99%.*(1)
The breadth and depth of the decline in mid caps in the first four months
approached levels last seen in the summer and fall of 1990. The 1990 correction
signaled the end of an extended period of underperformance for mid-cap stocks.
The recent decline appears similar--we believe it signaled the end of a
correction that began in the summer of 1996. Small-cap stocks performed strongly
in May and June, reversing much of the declines from January through April. For
the year to date, however, they still lag the S&P 500 by a wide margin.
By the end of April, valuations in mid-size, high growth stocks had become
extraordinarily compelling. Many stocks were cheaper relative to their rate of
earnings growth than they had been since 1990. We used the buying opportunity to
further improve the quality of the portfolio. We remain overweighted in
technology and health care, and underweighted in financials, utilities and
energy. These weightings reflect our bias toward companies that have strong and
consistent earnings growth.
THE CASE FOR MID CAPS
We believe that the mid-capitalization sector of the marketplace has the
potential to provide investors with superior returns over time. This belief
rests on several premises that are structural as well as cyclical:
o The global landscape of the 1990s is one of rapid change. The removal of
tariffs as barriers to trade and the rise of new economic powers such as
China imply that successful companies in the future will require
flexibility, agility, and innovation to capitalize on what seems to be an
ever more quickly changing world.
This changing landscape plays to the strengths of mid-size companies, many
of which have developed new business models involving strategic
relationships around the world. These models capitalize on the flexibility
and agility inherent in mid-size companies so that their ability to seek
out opportunities in advance of their larger brethren become significant
competitive advantages, while their small size, in today's free market
environment, is no longer a disadvantage.
o Mid-capitalization stocks are a relatively new phenomenon as a separate
asset class. Currently, they represent less than 10% of the U.S. stock
market in terms of capitalization. It is an asset class that offers
attractive risk/return characteristics. Companies of this size offer
significantly more growth potential than larger-capitalization stocks, but
have more mature and consistent business models than small-capitalization
stocks. Historically, they move with smaller-capitalization stocks' cycles,
and over long periods of time, they have delivered returns almost
comparable with that of the small-cap sector with less risk. In an era of
greater overall volatility and concern about risk, these characteristics
may make them ideal investments for those seeking greater returns than
larger-cap stocks but a lower risk profile than smaller-cap stocks. We
believe that as the characteristics of this asset class are better
understood, it will attract more investor attention.
6
<PAGE>
o The potential reward profile of this sector of the market continues to be
outstanding. The valuations of mid-size companies are below those of
large-cap stocks, but the mid-cap sector is expected to have higher growth
rates over the next 12 months.
As we approach the beginning of the next century, we are truly in the midst of a
global, structural transformation that has tremendous cultural, political,
social and economic implications. New technological and economic leaders will
emerge. Our strategy seeks to capture these trends and identify these companies
before the market fully uncovers them.
We believe that mid-size growth companies are exceptionally well positioned to
take advantage of these major changes. We also believe they will positively
surprise investors by showing continued improvement in profitability and raw
earnings power for the foreseeable future. Clearly, those companies that are on
the cutting edge of the change curve will lead the way. We believe the Fund is
well positioned to take advantage of these opportunities.
Thank you for your investment in the Strong Mid Cap Fund. We appreciate your
support and look forward to serving your investment needs in the future.
Sincerely,
/s/Mary Lisanti
Mary Lisanti
/s/Jeffrey M.K. Bernstein
Jeffrey M.K. Bernstein
Portfolio Managers
[PHOTO OF MARY LISANTI & JEFFREY M.K. BERNSTEIN]
================================================================================
GROWTH OF AN ASSUMED $10,000 INVESTMENT
From 12-31-96 to 6-30-97
================================================================================
[GRAPH]
THE STRONG S & P MidCap Lipper Mid Cap
MID CAP FUND 400 Stock Index* Funds Index*
12-96 10,000 10,000 10,000
1-97 10,500 10,375 10,327
2-97 9,890 10,290 9,935
3-97 8,963 9,851 9,337
4-97 8,823 10,106 9,510
5-97 9,814 10,990 10,466
6-97 10,104 11,299 10,819
This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with similar investments in the
Standard & Poor's MidCap 400 Stock Index and the Lipper Mid Cap Funds Index.
Results include the reinvestment of all dividends and capital gains
distributions. Performance is historical and does not represent future results.
Investment returns and principal value vary, and you may have a gain or loss
when you sell shares.
================================================================================
================================================
TOTAL RETURN(1)
As of 6-30-97
================================================
SINCE INCEPTION 1.04%
(on 12-31-96)
================================================
- --------------------------------------------------------------------------------
* The S&P MidCap 400 Stock Index is an unmanaged index generally
representative of the U.S. stock market, without regard to company size.
The Lipper Mid Cap Funds Index is an equally-weighted performance index of
the largest qualifying funds in this Lipper category. Source of the S&P
index data is Micropal. Source of the Lipper index data is Lipper
Analytical Services, Inc.
1 Total return is not annualized and measures aggregate change in the value
of an investment in the Fund, assuming reinvestment of dividends.
7
<PAGE>
THE STRONG COMMON STOCK FUND
FOR THE SIX MONTHS ENDED JUNE 30, THE MARKET WAS VERY STRONG, BUT IT WAS ALSO
NARROW.
The Strong Common Stock Fund seeks capital growth. The Fund invests at least 80%
of its net assets in equity securities, emphasizing small companies that the
Fund's Advisor believes are under-researched and attractively valued.
For the six months ended June 30, the market was very strong, but it was also
narrow, with the bulk of the S&P 500's returns coming from just 10 to 12 of its
largest stocks. Most of the market posted modest returns, and even losses.
Nonetheless, the Fund was able to deliver a return of 14.93% for the six months.
That figure is well ahead of our benchmark, the Russell 2000 Index, which
returned 10.20% for the same period.*(1)
========================================
ASSET ALLOCATION
Based on net assets as of 6-30-97
========================================
[PIE CHART]
Stocks 95.5%
Short-Term Investments 4.5%
========================================
====================================================
TOP FIVE SECTORS
As of 6-30-97
====================================================
SECTOR % OF NET ASSETS
- ----------------------------------------------------
Technology 23.9%
....................................................
Consumer Cyclical 14.6%
....................................................
Energy 13.0%
....................................................
Capital Equipment 9.7%
....................................................
Financial 8.3%
....................................................
Please see the Schedule of Investments in Securities
for a complete listing of the Fund's portfolio.
====================================================
AN UNUSUAL MARKET
The market has been an aberration, in that it's been driven by just a few
stocks. Momentum has played a larger role in many stocks' performance than their
underlying fundamentals. Investors in this narrow group of stocks could be
paying more than the companies are worth--and that's different from what we try
to do with the Common Stock Fund.
Our private value approach to investing means that we look at stocks as if we
were considering buying the entire company--and then compare the price we'd be
willing to pay with the current stock price. Finding stocks that trade
significantly below this private value is easier among the smaller companies
that are this Fund's focus.
SPECIFIC AREAS OF FOCUS HAVE WORKED WELL
Although the momentum for larger companies predominated for most of the past six
months, there has been some broadening out recently. For example, small-cap
stocks experienced some strength in May. Much of the small-cap market had been
so beaten down that it enjoyed a rebound. The portfolio benefited from this
rally because few of our smaller stocks had been battered--so their increases in
May weren't offset by an earlier decline.
Our significant overweighting in media stocks has begun to pay off. Our picks in
this sector did well in May and June, on the heels of Microsoft's announcement
that it would invest $1 billion in cable television operations.
The position we've built up in foreign stocks has also performed well. We're
pleased with our small position in Latin American companies, which seem to have
good prospects going forward, along with our Canadian stocks.
We have built a long record of success based on a discipline of looking for
opportunities in underfollowed sectors and buying stocks cheaply. This has been
a good strategy over the long term, but of late it has presented opportunity
costs as the market's attention has fled toward the largest, best-known
companies. We're not going to change a proven strategy because of unusual market
conditions, however. As the correction in late March and early April showed,
markets can change quickly. This Fund is positioned to do well when softness
hits the market's current leaders, and to continue to keep pace in a healthy
market environment.
================================================================================
FIVE LARGEST STOCK HOLDINGS
As of 6-30-97
================================================================================
% OF NET
SECURITY INDUSTRY ASSETS
- --------------------------------------------------------------------------------
Data General Corporation Computer-Personal 1.8%
and Workstation
................................................................................
Unifi, Inc. Shoe and Apparel 1.6%
Manufacturing
................................................................................
WellPoint Health Healthcare-Patient Care 1.5%
Networks, Inc.
................................................................................
Falcon Drilling Oil Well Equipment 1.4%
Company, Inc. and Service
................................................................................
Nautica Enterprises, Inc. Shoe and Apparel 1.4%
Manufacturing
................................................................................
Please see the Schedule of Investments in Securities for a complete listing of
the Fund's portfolio.
================================================================================
8
<PAGE>
OUTLOOK
Currently, the market is enjoying the best of all worlds. The domestic economy
is strong, inflation is low, and favorable conditions reign in most foreign
markets. With such a positive environment, if the market were ever to be at a
high, it would be now. Investors really shouldn't focus on whether the market is
too high; rather, they should think about whether the world will remain as solid
as it has been recently.
Our strategy should serve investors especially well if we experience more
challenging conditions in the coming months. The portfolio has been assembled
with a strong eye toward valuations, and it focuses on quiet or ignored sectors
of the market. A market downturn would likely punish momentum-driven stocks,
while we would expect stocks out of the limelight to fare better.
We're renewing our focus on high-quality companies. At times, this may mean
paying somewhat more for a stock than we might have been willing to in the past.
This is not a shift in strategy. It's a refinement that is designed to help the
Fund prosper in the current environment. When few stocks are cheap on an
absolute basis, it's necessary to look for companies at reasonable valuations
with strong management teams and competitive positions.
We welcome our new shareholders who joined us when the Fund briefly reopened to
IRA investors this spring. We look forward to helping you, as well as our
longtime investors, to pursue your financial goals. Thank you for your
investment in the Strong Common Stock Fund.
Sincerely,
/s/Richard T. Weiss
Richard T. Weiss
/s/Marina Carlson
Marina Carlson
Portfolio Managers
[PHOTO OF RICHARD T. WEISS & MARINA CARLSON]
================================================================================
GROWTH OF AN ASSUMED $10,000 INVESTMENT
From 12-29-89 to 6-30-97
================================================================================
[GRAPH]
THE STRONG
COMMON STOCK S & P 500 Lipper Growth
FUND Stock Index* Fund Index*
12-89 10,000 10,000 10,000
12-90 10,100 9,689 9,458
12-91 15,864 12,641 12,894
12-92 19,160 13,604 13,879
12-93 23,987 14,975 15,541
12-94 23,871 15,173 15,297
12-95 31,609 20,875 20,292
12-96 38,077 25,668 23,838
6-97 43,764 30,958 27,510
This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with similar investments in the
Standard & Poor's 500 Stock Index ("S&P 500") and the Lipper Growth Funds Index.
Results include the reinvestment of all dividends and capital gains
distributions. Performance is historical and does not represent future results.
Investment returns and principal value will vary, and you may have a gain or
loss when you sell shares.
================================================================================
================================================
AVERAGE ANNUAL
TOTAL RETURNS(1)
As of 6-30-97
================================================
1-YEAR 28.18%
3-YEAR 23.48%
5-YEAR 22.98%
SINCE INCEPTION 21.75%
(on 12-29-89)
================================================
- --------------------------------------------------------------------------------
* The S&P 500 is an unmanaged index generally representative of the U.S.
stock market, without regard to company size. The Russell 2000(R) Index is
an unmanaged index generally representative of the U.S. market for small
cap stocks. The Lipper Growth Funds Index is an equally-weighted
performance index of the largest qualifying funds in this Lipper category.
Source of the S&P and the Russell index data is Micropal. Source of the
Lipper index data is Lipper Analytical Services, Inc.
1 Average annual total return and total return measure change in the value of
an investment in the Fund, assuming reinvestment of all dividends and
capital gains. Average annual total return reflects annualized change,
while total return reflects aggregate change.
9
<PAGE>
THE STRONG GROWTH FUND
WE'RE SEEING THE MARKET MOVE MORE TOWARD THE STYLE OF INVESTING THAT HAS ALLOWED
THIS FUND TO POST STRONG RETURNS IN THE RECENT PAST.
The Strong Growth Fund seeks capital growth. The Fund invests primarily in
equity securities that the Fund's Advisor believes have above-average growth
prospects.
========================================
ASSET ALLOCATION
Based on net assets as of 6-30-97
========================================
[PIE CHART]
Stocks 98.8%
Short-Term Investments 1.2%
========================================
====================================================
TOP FIVE SECTORS
As of 6-30-97
====================================================
SECTOR % OF NET ASSETS
- ----------------------------------------------------
Technology 32.9%
....................................................
Healthcare 15.9%
....................................................
Financial 12.5%
....................................................
Consumer Cyclical 8.7%
....................................................
Capital Equipment 8.6%
....................................................
Please see the Schedule of Investments in Securities
for a complete listing of the Fund's portfolio.
====================================================
A NARROW, BUT BROADENING MARKET
The past six months have been challenging for Funds not solely tied to large-cap
stocks. That's because the market has been driven primarily by a rush to the
very largest companies in the market. Even the S&P 500, itself a somewhat
exclusive group of 500 of the largest companies, has seen its performance driven
by just a handful of its biggest stocks. Thus the benchmark has become less and
less reflective of what's happening in the broader market.*
What's very positive is that, after some time, we're finally seeing the market
move more toward the style of investing that has allowed this Fund to post
strong returns in the recent past. Perhaps the clearest evidence of this
broadening of the market's strength is our return for the second quarter of this
year, a healthy 17.70%. That slightly exceeds the S&P 500's return for the same
period. Given that our return for the six months ended June 30 is 9.66%
(compared with the S&P's 20.61%), that signifies a real improvement in the
broader market-- and in the type of stocks we pick.(1)
WHAT'S DRIVING THE FUND
Taking a look at some of the stocks that have driven our return to form say much
about the criteria we use as we invest.
o Pharmaceuticals maker Warner-Lambert, currently our largest holding, has
been on a tear with the early success of two new drugs, Lipitor (for high
blood cholesterol) and Rezulin (an oral diabetes medication). These are
projected to become some of the fastest growing new drugs ever. We selected
Warner-Lambert not only for its strong fundamentals and its reasonable
valuation, but also for the strength and improvement we perceived in its
competitive position. In addition to these two new products, the company
has several other new drugs in the pipeline, as well as an array of
successful, established brands.
Our investment in Warner-Lambert also reflects one of the recurring themes
of this Fund: investing in health-care related companies, which stand to
benefit from the aging U.S. population. We continue to overweight this
sector.
o Kohl's, a department store chain, is a smaller but still important stock
for the Fund. Based in our back yard in Menomonee Falls, Kohl's has been
steadily picking up steam. Its expansion in the Washington-Philadelphia
corridor has been successful, and its comparable-store sales have enjoyed
double-digit growth. Our focus on the company's financial strength, and our
direct, on-site research, helped us to select this stock at an attractive
valuation.
================================================================================
FIVE LARGEST STOCK HOLDINGS
As of 6-30-97
================================================================================
% OF NET
SECURITY INDUSTRY ASSETS
- --------------------------------------------------------------------------------
Warner-Lambert Company Healthcare- 2.7%
Drug/Diversified
................................................................................
Danka Business Systems Office Automation 2.2%
PLC Sponsored ADR
................................................................................
Eli Lilly & Company Healthcare- 1.9%
Drug/Diversified
................................................................................
Tellabs, Inc. Telecommunication 1.9%
Equipment
................................................................................
Visio Corporation Computer Software 1.6%
................................................................................
Please see the Schedule of Investments in Securities for a complete listing of
the Fund's portfolio.
================================================================================
10
<PAGE>
o Oil services and drilling has been an important sector. We've been
investing with this theme for the past few years, and it appears to us that
it still has a couple of years left to run. Driving this sector has been
new exploration; as this activity has paid off with new oil reserves, it
has added to these companies' earnings power.
o We've also enjoyed success as the market has favored other longtime themes
of ours, including technology and financials.
We've always asked investors to consider the Strong Growth Fund a long-term
investment, and that's how we'll continue to invest ourselves. We will stick
with what we consider to be the best strategy for the long term--looking among
small-, medium-, and large-cap companies for the highest-quality firms with
reasonable valuations in sectors that are poised for growth. We believe we have
positioned the portfolio to benefit from the broadening of the bull market that
has begun, and that we anticipate will continue.
We thank you for your investment with the Strong Growth Fund, and appreciate
your continued support. We look forward to helping you pursue your important
financial goals for years to come.
Sincerely,
/s/ Ron Ognar
Ron Ognar
Portfolio Manager
[PHOTO OF RON OGNAR]
================================================================================
GROWTH OF AN ASSUMED $10,000 INVESTMENT
From 12-31-93 to 6-30-97
================================================================================
[GRAPH]
THE STRONG S & P 500 Lipper Growth
GROWTH FUND Stock Index* Funds Index*
12-93 10,000 10,000 10,000
12-94 11,726 10,132 9,842
12-95 16,535 13,939 13,056
12-96 19,763 17,140 15,338
6-97 21,672 20,672 17,701
This graph, prepared in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with a similar investment in the
Standard & Poor's 500 Stock Index ("S&P 500") and the Lipper Growth Funds Index.
Results include the reinvestment of all dividends and capital gains
distributions. Performance is historical and does not represent future results.
Investment returns and principal value vary, and you may have a gain or loss
when you sell shares.
================================================================================
================================================
AVERAGE ANNUAL
TOTAL RETURNS(1)
As of 6-30-97
================================================
1-YEAR 11.52%
3-YEAR 26.78%
SINCE INCEPTION 24.73%
(on 12-31-93)
================================================
- --------------------------------------------------------------------------------
* The S&P 500 is an unmanaged index generally representative of the U.S.
stock market, without regard to company size. The Lipper Growth Funds Index
is an equally-weighted performance index of the largest qualifying funds
in this Lipper category. Source of the S&P index data is Micropal. Source
of the Lipper index data is Lipper Analytical Services, Inc.
1 Average annual total return and total return measure change in the value of
an investment in the Fund, assuming reinvestment of all dividends and
capital gains. Average annual total return reflects annualized change,
while total return reflects aggregate change.
11
<PAGE>
THE STRONG DISCOVERY FUND
OVERALL, THE RECENT MARKET ENVIRONMENT REMINDS US OF 1990 AND 1991.
The Strong Discovery Fund seeks to provide investors with capital growth, a goal
we pursue by investing in a diversified portfolio of small-, mid-, and
larger-cap stocks. Our investment approach combines number-crunching analysis
with direct research, including on-site visits. Through frequent discussions
with management, suppliers, customers and competitors, we believe we can
identify vital aspects of companies that aren't reflected in their historical
financial statements--or their stock prices.
========================================
ASSET ALLOCATION
Based on net assets as of 6-30-97
========================================
[PIE CHART]
Stocks 93.9%
Convertible Securities 0.2%
Short-Term Investments 5.9%
The Fund's asset allocation does not
reflect any futures positions held
by the Fund.
========================================
The Discovery Fund's portfolio measures up well under the key criteria we use
when selecting stocks--good businesses, good managements and attractive
valuations. In general, we are pleased with the quality and performance of the
companies in the portfolio. With few exceptions, they have been meeting or
exceeding their profit targets. We are also pleased with the valuation of the
portfolio, especially compared with the high valuations being accorded the large
companies that dominate the S&P 500 Index. As the following table illustrates,
the Fund's average valuation--as measured by its price/earnings ratio--is
slightly below the S&P 500's. Based on our analysis of the companies in the
portfolio, we estimate the portfolio's earnings growth potential to be more than
three times that of the S&P 500. By concentrating on companies with superior
growth potential, we seek to produce superior investment results over time.
P/E RATIO ESTIMATED
FUND (1998 EARNINGS) EARNINGS GROWTH(1)
- --------------------------------------------------------------------------------
Strong Discovery Fund 17.9x 24.3%
S&P 500 Index 18.8x 7.8%
In our investment process, we make forward-looking decisions. Our job is to
position the portfolio for what we expect to happen, not to chase after the
market sectors or stocks that have recently performed best. We continue to
believe that small- and medium-size growth stocks offer the most opportunity
looking forward. In hindsight, however, our decision to emphasize this group was
premature. As a result, our 4.01% total return for the first half of 1997
trailed the 20.61% return of the S&P 500 and the 10.16% return of our peer
group, the Lipper Capital Appreciation Funds Index. Including this year's
performance through June, the Discovery Fund's average annual total return since
its 12-31-87 inception is 16.32%, which keeps us ahead of our peer group's
average annual return of 14.82%. But it puts us below the S&P's average annual
gain since our inception-- a figure we have historically surpassed--of
17.83%.*(2)
12
<PAGE>
Overall, the recent market environment reminds us of 1990 and 1991. Then as now,
investors moved toward indexation--trying to replicate the S&P 500 without
regard for the merits of the individual companies or their prices. Eventually
this cycle came to an end, creating an opportunity for investors willing to
consider stocks outside the S&P 500's largest. We were able to capitalize on the
situation then, and posted a 67.6% gain for 1991, versus a 30.5% return for the
S&P 500. We have currently positioned the Fund to benefit from what may be a
similar scenario.
Thank you for your investment in the Strong Discovery Fund. We appreciate your
support, and are committed to earning it.
Sincerely,
/s/Richard S. Strong
Richard S. Strong
/s/Chip Paquelet
Charles A. Paquelet
Portfolio Managers
[PHOTO OF RICHARD S. STRONG & CHARLES A. PAQUELET]
================================================================================
GROWTH OF AN ASSUMED $10,000 INVESTMENT
From 12-31-87 to 6-30-97
================================================================================
[GRAPH]
Lipper Capital
THE STRONG S & P 500 Appreciation
DISCOVERY FUND Stock Index* Funds Index*
12-87 10,000 10,000 10,000
12-88 12,445 11,660 11,284
12-89 15,427 15,355 14,478
12-90 15,005 14,878 13,351
12-91 25,150 19,411 18,366
12-92 25,638 20,890 19,754
12-93 31,332 22,996 22,865
12-94 29,552 23,300 22,303
12-95 39,884 32,055 29,350
12-96 40,438 39,415 33,737
6-97 42,061 47,538 37,166
This graph, prepared in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with a similar investment in the
Standard & Poor's 500 Stock Index ("S&P 500") and the Lipper Capital
Appreciation Funds Index. Results include the reinvestment of all dividends and
capital gains distributions. Performance is historical and does not represent
future results. Investment returns and principal value will vary, and you may
have a gain or loss when you sell shares.
================================================================================
================================================
AVERAGE ANNUAL
TOTAL RETURNS(2)
As of 6-30-97
================================================
1-YEAR 7.62%
3-YEAR 14.63%
5-YEAR 12.77%
SINCE INCEPTION 16.32%
(on 12-31-87)
================================================
- --------------------------------------------------------------------------------
* The S&P 500 is an unmanaged index generally representative of the U.S.
stock market, without regard to company size. The Lipper Capital
Appreciation Funds Index is an equally-weighted performance index of the
largest qualifying funds in this Lipper category. Source of the S&P index
data is Micropal. Source of the Lipper index data is Lipper Analytical
Services, Inc.
1 Earnings growth has been estimated for a projected five-year period. The
Discovery Fund's earnings growth estimate has been generated from our own
analysis of the portfolio's individual securities as of June 30, 1997. The
earnings growth projection for the S&P 500 has been based on a consensus of
earnings estimates from six Wall Street investment firms as shown by
Bloomberg dated June 30, 1997.
2 Average annual total return and total return measure change in the value of
an investment, assuming reinvestment of all dividends and capital gains.
Average annual total return reflects annualized change, while total return
reflects aggregate change.
13
<PAGE>
THE STRONG SMALL CAP FUND
BY THE END OF APRIL, VALUATIONS IN SMALLER, HIGH GROWTH STOCKS HAD BECOME
EXTRAORDINARILY COMPELLING.
The Strong Small Cap Fund seeks capital growth. The Fund invests primarily in
stocks of companies that have small market capitalizations. While these stocks
can be very volatile over short time periods, they have the potential to amply
reward investors over time.
In general, the Fund tends to invest in high-growth companies rather than
low-priced value-style stocks. Growth companies typically offer the benefits of
talented management, strong balance sheets, healthy sales, and accelerating
earnings growth.
========================================
ASSET ALLOCATION
Based on net assets as of 6-30-97
========================================
[PIE CHART]
Stocks 95.4%
Short-Term Investments 4.6%
========================================
====================================================
TOP FIVE SECTORS
As of 6-30-97
====================================================
SECTOR % OF NET ASSETS
- ----------------------------------------------------
Technology 39.7%
....................................................
Healthcare 16.3%
....................................................
Retail 15.2%
....................................................
Capital Equipment 13.2%
....................................................
Financial 4.4%
....................................................
Please see the Schedule of Investments in Securities
for a complete listing of the Fund's portfolio.
====================================================
SMALL COMPANY STOCKS HAD A DIFFICULT FIRST HALF
The Fund's underperformance in the first half of the year relative to its
benchmark, the Russell 2000, reflects its growth style. The entire small
capitalization sector of the marketplace experienced a severe correction through
the first four months of 1997, driven by fears that stronger than expected
economic growth would lead to rising inflation and interest rates. The decline
in the higher-growth, higher-price sector of the small-cap market during these
first four months was much deeper than the decline in the Russell 2000. The
technology sector, in which the Fund is overweighted, was particularly hard hit.
As a result, the Fund's returns for the six months of -8.85% lagged the
Russell's 10.20% gain.*(1)
The breadth and depth of the decline in small caps in the first four months
approached levels last seen in the summer and fall of 1990. The 1990 correction
signaled the end of an extended period of underperformance for small-cap stocks.
The recent decline appears similar--we believe it signaled the end of a
correction that began in the summer of 1996. Small cap stocks performed strongly
in May and June, reversing much of the declines from January through April. For
the year to date, however, they still lag the S&P 500 by a wide margin.
By the end of April, valuations in smaller, high growth stocks had become
extraordinarily compelling. Many stocks were cheaper relative to their rate of
earnings growth than they had been since 1990. We used the buying opportunity to
further improve the quality of the portfolio. We remain overweighted in
technology and health care, and underweighted in financials, utilities, and
energy. These weightings reflect our bias toward companies that have strong and
consistent earnings growth. In choosing stocks, we concentrated on those that
fit our highly defined investment criteria:
o We build our portfolio based on broad secular trends affecting the
economic, societal, and demographic landscape. These overarching
themes--which help the portfolio reflect where the world is headed--include
the aging of America, the move toward increased leisure time and the
technological revolution. Having identified these themes, we emphasize
companies that we believe are best able to capitalize on them.
o Firms must pass our extensive database screening, which focuses on aspects
such as a company's price/earnings ratio relative to its growth rate. This
helps us identify a preliminary universe of companies with promising
characteristics. It also helps us capitalize on the market's volatility,
because we're able to add to or initiate positions in such companies during
periods of price weakness.
o Prospective purchases must measure up from a fundamental research
standpoint. This research includes on-site visits with senior management,
and factors that help us gauge a company's ability to provide consistently
strong earnings and revenue growth.
We also employ a strict sell discipline to help manage risk.
14
<PAGE>
OUR OUTLOOK FOR THE NEAR TERM
Given their strong earnings outlook and extremely reasonable valuations, we
believe smaller-cap stocks, and particularly smaller-cap growth stocks, are
positioned to outperform the general market through the rest of 1997 and into
1998. The economic environment remains benign. Many smaller growth stocks sell
at significant discounts to their earnings growth. As these companies continue
to deliver earnings growth in excess of the S&P 500, we believe investor
confidence will increase and valuations will rise. We believe the portfolio is
well positioned to outperform in the coming months, given that the average
company in the portfolio trades at what historically has been the steepest
discount we have seen on high-quality companies. Nonetheless, because small
companies often have narrower markets and limited financial resources,
investments in these stocks present more risk than investments in those of
larger, more established companies.
LOOKING FURTHER AHEAD
As we approach the beginning of the next century, we are truly in the midst of a
structural transformation with tremendous worldwide cultural, political, social
and economic implications. We believe several of these structural changes play
to the strengths of smaller companies.
o TECHNOLOGY AS THE GREAT LEVELER. Technology is eliminating the size
advantage that many large companies have traditionally enjoyed relative to
smaller companies. Today, with technological solutions, a small company can
often go global as quickly and effectively as a large corporation.
o RAPID GLOBAL CHANGE. Mature economies, led by the United States, are moving
from the Industrial Age to the Information Age. The world is no longer
composed of three trading blocks that move in lockstep with each other. In
a climate of rapid change, successful companies must be flexible, agile,
and innovative. We believe these traits reside to a larger extent in
smaller companies, because their entrepreneurial cultures typically enable
them to react quickly and decisively.
Thank you for your investment in the Strong Small Cap Fund. We appreciate your
support and we look forward to serving your investment needs in the future.
Sincerely,
/s/ Mary Lisanti
Mary Lisanti
Portfolio Manager
[PHOTO OF MARY LISANTI]
================================================================================
GROWTH OF AN ASSUMED $10,000 INVESTMENT
From 12-29-95 to 6-30-97
================================================================================
[GRAPH]
Lipper
THE STRONG S & P 500 Small Cap
SMALL CAP FUND Stock Index* Funds Index*
12-95 10,000 10,000 10,000
3-96 11,728 10,536 10,563
6-96 12,468 11,009 11,407
9-96 12,398 11,349 11,552
12-96 12,269 12,295 11,450
3-97 10,055 12,625 10,359
6-97 11,183 14,829 12,126
This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with similar investments in the
Standard & Poor's 500 Stock Index ("S&P 500"), and the Lipper Small Cap Funds
Index. Results include the reinvestment of all dividends and capital gains
distributions. Performance is historical and does not represent future results.
Investment returns and principal value vary, and you may have a gain or loss
when you sell shares.
================================================================================
================================================
AVERAGE ANNUAL
TOTAL RETURNS(1)
As of 6-30-97
================================================
1-YEAR -10.31%
SINCE INCEPTION 7.74%
(on 12-29-95)
================================================
- --------------------------------------------------------------------------------
* The Russell 2000(R) Index is an unmanaged index generally representative of
the U.S. market for small cap stocks. The S&P 500 is an unmanaged index
generally representative of the U.S. stock market, without regard to
company size. The Lipper Small Cap Funds Index is an equally-weighted
performance index of the largest qualifying funds in this Lipper category.
Source of the S&P and the Russell index data is Micropal. Source of the
Lipper index data is Lipper Analytical Services, Inc.
1 Average annual total return and total return measure change in the value of
an investment in the Fund, assuming reinvestment of all dividends and
capital gains. Average annual total return reflects annualized change,
while total return reflects aggregate change.
15
<PAGE>
SCHEDULES OF INVESTMENTS IN SECURITIES June 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
STRONG VALUE FUND
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
- --------------------------------------------------------------------------------
COMMON STOCKS 83.7%
AEROSPACE & DEFENSE 0.2%
McDonnell Douglas Corporation 2,500 $ 171,250
AUTOMOBILE 2.8%
Ford Motor Company 54,700 2,064,925
BANK - MONEY CENTER 1.6%
Chase Manhattan Corporation 12,100 1,174,456
BANK - SUPER REGIONAL 1.0%
Banc One Corporation 14,500 702,344
BROKERAGE & INVESTMENT MANAGEMENT 1.1%
Berkshire Hathaway, Inc. Class B (b) 534 843,720
CHEMICAL 1.7%
IMC Global, Inc. 36,900 1,291,500
CHEMICAL - SPECIALTY 1.4%
Engelhard Corporation 29,000 607,188
Morton International, Inc. 13,500 407,531
----------
1,014,719
COMMERCIAL SERVICE 3.5%
ACNielsen Corporation (b) 11,366 223,058
ADT, Ltd. (b) 46,400 1,531,200
Dun & Bradstreet Corporation 24,500 643,125
Reynolds & Reynolds Company Class A 10,000 157,500
----------
2,554,883
DIVERSIFIED OPERATIONS 4.5%
Allied Signal, Inc. 18,200 1,528,800
Corning, Inc. 17,300 962,313
E.I. du Pont de Nemours & Company 13,400 842,525
----------
3,333,638
ELECTRIC POWER 3.4%
Duke Power Company 34,435 1,650,728
Public Service Company of Colorado 2,500 103,750
Sierra Pacific Resources 22,400 716,800
----------
2,471,278
ELECTRICAL EQUIPMENT 2.2%
AMP, Inc. 2,000 83,500
General Electric Company 9,400 614,525
Honeywell, Inc. 11,800 895,325
----------
1,593,350
ELECTRONIC PRODUCTS - MISCELLANEOUS 1.0%
General Motors Corporation Class H 12,200 704,550
ENGINEERING & CONSTRUCTION 3.2%
Fluor Corporation 42,800 2,362,025
FINANCE - MISCELLANEOUS 3.4%
American Express Company 9,500 707,750
Morgan Stanley, Dean Witter, Discover & Company 28,300 1,218,669
Providian Financial Corporation (b) 17,000 546,125
----------
2,472,544
FOOD 3.3%
CPC International, Inc. 7,700 710,806
General Mills, Inc. 8,900 579,613
IBP, Inc. 48,900 1,136,925
----------
2,427,344
HEALTHCARE - DRUG/DIVERSIFIED 1.1%
Eli Lilly & Company 7,700 841,706
HEALTHCARE - PATIENT CARE 1.5%
Vencor, Inc. (b) 26,200 1,106,950
HOUSEHOLD APPLIANCES & FURNISHINGS 1.9%
Sunbeam Corporation 36,300 1,370,325
INSURANCE - ACCIDENT & HEALTH 0.9%
Provident Companies, Inc. 12,800 684,800
INSURANCE - DIVERSIFIED 1.5%
American General Corporation 23,800 1,136,450
INSURANCE - LIFE 0.1%
Hartford Life, Inc. Class A (b) 2,000 75,000
LEISURE PRODUCT 1.7%
Eastman Kodak Company 16,100 1,235,675
LEISURE SERVICE 3.3%
Hilton Hotels Corporation 36,900 980,156
International Game Technology 73,500 1,304,625
Ticketmaster Group, Inc. (b) 10,000 166,250
----------
2,451,031
MEDIA - PUBLISHING 0.7%
Scholastic Corporation (b) 15,000 525,000
John Wiley & Sons, Inc. 500 16,938
----------
541,938
MEDIA - RADIO/TV 4.7%
Comcast Corporation Class A 35,400 756,675
Cox Communications, Inc. Class A (b) 62,000 1,488,000
HSN, Inc. (b) 37,905 1,184,530
----------
3,429,205
NATURAL GAS DISTRIBUTION 1.9%
Enron Corporation 33,600 1,371,300
OFFICE AUTOMATION 2.0%
Xerox Corporation 18,500 1,459,188
OIL - INTERNATIONAL INTEGRATED 1.7%
Santa Fe International Corporation (b) 37,600 1,278,400
OIL - NORTH AMERICAN EXPLORATION &
PRODUCTION 2.5%
Enron Oil & Gas Company 19,900 360,688
Union Pacific Resources Group, Inc. 59,458 1,479,017
----------
1,839,705
PAPER & FOREST PRODUCTS 2.0%
Champion International Corporation 14,900 823,225
Union Camp Corporation 13,000 650,000
----------
1,473,225
PERSONAL & COMMERCIAL LENDING 1.7%
Associates First Capital Corporation 22,700 1,259,850
POLLUTION CONTROL 0.4%
Waste Management, Inc. 9,300 298,763
RAILROAD 1.7%
Burlington Northern Santa Fe Corporation 10,000 898,750
Union Pacific Corporation 4,500 317,250
----------
1,216,000
REAL ESTATE 2.4%
National Golf Properties, Inc. 15,000 521,250
Charles E. Smith Residential Realty, Inc. 12,000 346,500
Vornado Realty Trust 12,900 930,412
----------
1,798,162
RETAIL - DEPARTMENT STORE 1.8%
Federated Department Stores, Inc. (b) 38,600 1,341,350
RETAIL - DRUG STORE 1.9%
Rite Aid Corporation 27,600 1,376,550
16
See notes to financial statements.
<PAGE>
- --------------------------------------------------------------------------------
STRONG VALUE FUND (continued)
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
- --------------------------------------------------------------------------------
RETAIL - FOOD CHAIN 0.2%
Albertson's, Inc. 4,000 $ 146,000
RETAIL - MAJOR CHAIN 0.1%
Wal-Mart Stores, Inc. 3,000 101,438
RETAIL - RESTAURANT 1.4%
McDonald's Corporation 20,900 1,009,731
RETAIL - SPECIALTY 2.1%
CUC International, Inc. (b) 44,600 1,151,237
The Hertz Corporation (b) 12,100 435,600
-----------
1,586,837
SHOE & APPAREL MANUFACTURING 1.0%
Polo Ralph Lauren Corporation (b) 26,000 711,750
TELECOMMUNICATION SERVICE 4.0%
AirTouch Communications, Inc. (b) 24,600 673,425
Paging Network, Inc. (b) 70,000 614,687
U.S. West, Inc. Media Group (b) 10,000 202,500
WorldCom, Inc. (b) 44,400 1,420,800
-----------
2,911,412
TELEPHONE 1.1%
GTE Corporation 18,000 789,750
TRUCKING 2.1%
CNF Transportation, Inc. 47,800 1,541,550
-----------
TOTAL COMMON STOCKS (COST $52,062,954) 61,566,567
CONVERTIBLE PREFERRED STOCKS 3.3%
AirTouch Communications, Inc. Class B 6.00% 22,000 627,000
Kmart Financing I Trust Securities 7.75% 16,900 927,388
Vornado Realty Trust Series A $3.25 17,200 911,600
-----------
TOTAL CONVERTIBLE PREFERRED STOCKS
(COST $2,366,484) 2,465,988
PREFERRED STOCKS 0.0%
Fresenius National Medical Care, Inc. Class D (b)
(COST $0) 8,500 489
SHORT-TERM INVESTMENTS (a) 13.2%
COMMERCIAL PAPER 1.7%
INTEREST BEARING, DUE UPON DEMAND
General Mills, Inc., 5.27% $ 100 100
Johnson Controls, Inc., 5.31% 1,001,100 1,001,100
Wisconsin Electric Power Company, 5.33% 251,600 251,600
-----------
1,252,800
REPURCHASE AGREEMENT 11.5%
Goldman, Sachs & Company (Dated 6/30/97),
5.75%, Due 7/01/97 (Repurchase proceeds
$8,501,358); Collateralized by: $7,925,000
United States Treasury Bonds, 7.50%,
Due 11/15/24(Market value $8,677,875)(f) 8,500,000 8,500,000
-----------
TOTAL SHORT-TERM INVESTMENTS
(COST $9,752,800) 9,752,800
-----------
TOTAL INVESTMENTS IN SECURITIES
(COST $64,182,238) 100.2% 73,785,844
Other Assets and Liabilities, Net (0.2%) (191,194)
-----------
NET ASSETS 100.0% $73,594,650
===========
PERCENTAGE OF
COUNTRY DIVERSIFICATION NET ASSETS
- ----------------------------------------------------------------
United States ........................................ 98.1%
Bermuda .............................................. 2.1
Other Assets and Liabilities, Net .................... (0.2)
------
Total 100.0%
======
- --------------------------------------------------------------------------------
STRONG OPPORTUNITY FUND
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
- --------------------------------------------------------------------------------
COMMON STOCKS 91.9%
AIRLINE 0.3%
Air New Zealand, Ltd. Class B 1,313,010 $ 4,016,629
Korean Airline Company, Ltd. (b) 50,000 942,438
-----------
4,959,067
BANK - MONEY CENTER 3.2%
BankAmerica Corporation 346,000 22,338,625
Deutsche Bank AG 55,500 3,240,946
Fuji Bank, Ltd. 169,000 2,535,811
Grupo Financiero Banamex Accival SA de CV (b) 992,000 2,607,893
Toronto - Dominion Bank 855,000 25,484,028
-----------
56,207,303
BANK - REGIONAL 1.0%
Mercantile Bancorporation, Inc. 300,000 18,225,000
BANK - SUPER REGIONAL 4.1%
Barnett Banks, Inc. 504,000 26,460,000
First Union Corporation 248,500 22,986,250
Mellon Bank Corporation 511,700 23,090,463
-----------
72,536,713
BEVERAGE - SOFT DRINK 0.2%
Coca-Cola Amatil, Ltd. 110,000 1,426,379
Pepsi-Gemex SA de CV GDR (b) 114,800 1,435,000
-----------
2,861,379
CHEMICAL - SPECIALTY 1.6%
Cabot Corporation 983,800 27,915,325
COMPUTER - PERIPHERAL EQUIPMENT 2.3%
American Power Conversion Corporation (b) 1,100,000 20,900,000
Seagate Technology, Inc. (b) 575,000 20,232,813
-----------
41,132,813
COMPUTER - PERSONAL & WORKSTATION 0.9%
Sun Microsystems, Inc. (b) 431,400 16,056,169
COMPUTER SOFTWARE 3.4%
Cabletron Systems, Inc. (b) 715,700 20,263,256
Cadence Design Systems, Inc. (b) 498,700 16,706,450
Sybase, Inc. (b) 1,604,800 23,871,400
-----------
60,841,106
CONGLOMERATE 0.1%
Guinness Peat Group PLC 1,464,100 905,719
DIVERSIFIED OPERATIONS 1.6%
Desc SA de CV Sponsored ADR (b) 65,400 1,904,775
Whitman Corporation 1,032,000 26,122,500
-----------
28,027,275
ELECTRIC POWER 3.1%
Centrais Electricas Brasileiras SA Sponsored ADR 39,000 1,155,375
Energy Group PLC 1,436,000 15,318,561
Energy Group PLC Sponsored ADR 258,800 10,966,650
NIPSCO Industries, Inc. 647,400 26,745,713
-----------
54,186,299
ELECTRONIC PARTS DISTRIBUTION 2.2%
Arrow Electronics, Inc. (b) 385,000 20,453,125
Marshall Industries (b) 483,300 18,002,925
-----------
38,456,050
ELECTRONIC PRODUCTS - MISCELLANEOUS 2.7%
AVX Corporation 900,000 24,300,000
Hubbell, Inc. Class B 530,000 23,320,000
-----------
47,620,000
ELECTRONICS - SEMICONDUCTOR/
COMPONENT 2.4%
KLA-Tencor Corporation (b) 440,000 21,450,000
Texas Instruments, Inc. 250,000 21,015,625
-----------
42,465,625
ENGINEERING & CONSTRUCTION 0.0%
Walker Corporation 500,000 414,645
17
See notes to financial statements.
<PAGE>
SCHEDULES OF INVESTMENTS IN SECURITIES June 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
STRONG OPPORTUNITY FUND (continued)
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
- --------------------------------------------------------------------------------
FINANCE - MISCELLANEOUS 0.1%
Hong Leong Finance, Ltd. (Fgn Reg) 294,000 $ 835,005
Japan Associated Finance 14,000 1,099,189
--------------
1,934,194
FOOD 5.5%
CPC International, Inc. 252,200 23,281,213
General Mills, Inc. 330,000 21,491,250
Lion Nathan, Ltd. 817,000 2,071,629
Nestle SA Sponsored ADR 365,000 24,409,375
Unilever NV 116,500 25,397,000
--------------
96,650,467
HEALTHCARE - DRUG/DIVERSIFIED 2.5%
Bristol-Myers Squibb Company 122,200 9,898,200
Merck & Company, Inc. 108,000 11,178,000
Pharmacia & Upjohn, Inc. 685,000 23,803,750
--------------
44,879,950
HEALTHCARE - MEDICAL SUPPLY 3.1%
McKesson Corporation 362,000 28,055,000
Sybron International Corporation (b) 671,500 26,776,063
--------------
54,831,063
HEALTHCARE - PATIENT CARE 1.0%
PacifiCare Health Systems, Inc. Class A 285,000 17,260,313
HOUSEHOLD APPLIANCES & FURNISHINGS 0.7%
Philips Electronics NV ADR 166,300 11,952,813
INSURANCE - DIVERSIFIED 0.5%
American General Corporation 190,000 9,072,500
INSURANCE - LIFE 0.6%
Hartford Life, Inc. Class A (b) 281,000 10,537,500
INSURANCE - PROPERTY & CASUALTY 2.7%
ACE, Ltd. 330,000 24,378,750
American International Group, Inc. 160,000 23,900,000
--------------
48,278,750
LEISURE SERVICE 1.3%
Gaylord Entertainment Company 1,045,900 24,121,069
MACHINERY - MISCELLANEOUS 1.3%
Ingersoll-Rand Company 380,000 23,465,000
MEDIA - PUBLISHING 1.2%
The E.W. Scripps Company Class A 504,900 21,016,463
MEDIA - RADIO/TV 5.3%
Comcast Corporation Class A 1,600,000 34,200,000
Cox Communications, Inc. Class A (b) 948,200 22,756,800
Grupo Televisa SA GDS (b) 48,000 1,458,000
Tele-Communications, Inc. Class A (b) 1,748,000 26,001,500
Tele-Communications, Inc. Liberty Media Group
Series A (b) 358,000 8,502,500
--------------
92,918,800
METAL PRODUCTS & FABRICATION 0.1%
Leader Universal Holdings BHD 820,000 1,474,960
METALS & MINING 1.2%
Freeport-McMoRan Copper & Gold, Inc. Class A 752,600 22,013,550
NATURAL GAS DISTRIBUTION 1.3%
Columbia Gas Systems, Inc. 369,100 24,083,775
OIL - NORTH AMERICAN EXPLORATION &
PRODUCTION 6.6%
Apache Corporation 728,000 23,660,000
Barrett Resources Corporation (b) 705,000 21,105,937
Devon Energy Corporation 679,000 24,953,250
Union Pacific Resources Group, Inc. 955,000 23,755,625
United Meridian Corporation (b) 750,000 22,500,000
--------------
115,974,812
OIL - NORTH AMERICAN INTEGRATED 1.3%
USX-Marathon Group 825,400 23,833,425
OIL WELL EQUIPMENT & SERVICE 4.0%
Baker Hughes, Inc. 577,000 22,322,687
Camco International, Inc. 460,000 25,185,000
Transocean Offshore, Inc. 310,000 22,513,750
--------------
70,021,437
PAPER & FOREST PRODUCTS 2.7%
Fletcher Challenge, Ltd. Forestry Division 1,711,000 2,489,114
The Mead Corporation 360,000 22,410,000
Willamette Industries, Inc. 315,000 22,050,000
--------------
46,949,114
PRECIOUS METAL/GEM/STONE 2.1%
De Beers Consolidated Mines, Ltd. ADR 610,000 22,531,875
Newmont Mining Company 363,400 14,172,600
--------------
36,704,475
RAILROAD 2.3%
Burlington Northern Santa Fe Corporation 240,000 21,570,000
Canadian National Railway Company 423,600 18,532,500
--------------
40,102,500
REAL ESTATE 1.2%
Equity Residential Properties Trust 250,000 11,875,000
First Industrial Realty Trust, Inc. 328,100 9,596,925
Shortland Properties, Ltd. 524,500 356,555
--------------
21,828,480
RETAIL - DEPARTMENT STORE 2.4%
Federated Department Stores, Inc. (b) 632,000 21,962,000
May Department Stores Company 440,000 20,790,000
--------------
42,752,000
RETAIL - FOOD CHAIN 0.9%
Albertson's, Inc. 435,400 15,892,100
RETAIL - MAJOR CHAIN 1.7%
Sears Canada, Inc. 536,000 7,182,384
Toys `R' Us, Inc. (b) 677,000 23,695,000
--------------
30,877,384
RETAIL - RESTAURANT 1.2%
Brinker International, Inc. (b) 1,568,900 22,356,825
RETAIL - SPECIALTY 0.1%
The Hertz Corporation (b) 30,000 1,080,000
SAVINGS & LOAN 0.5%
Charter One Financial, Inc. 167,600 9,029,450
STEEL 0.3%
British Steel PLC 1,799,400 4,461,897
TELECOMMUNICATION EQUIPMENT 0.5%
DSC Communications Corporation (b) 395,400 8,797,650
TELECOMMUNICATION SERVICE 6.6%
AirTouch Communications, Inc. (b) 964,600 26,405,925
Cable & Wireless Communications PLC (b) 300,000 1,622,595
Cable & Wireless Communications PLC ADR (b) 763,279 20,513,123
Nippon Telegraph & Telephone Corporation 3,900 3,742,475
Paging Network, Inc. (b) 2,000,000 17,562,500
Telecommunicacoes Brasileiras SA Sponsored ADR 27,000 4,097,250
U.S. West, Inc. Media Group (b) 1,165,000 23,591,250
United States Cellular Corporation (b) 615,300 18,228,262
--------------
115,763,380
--------------
TOTAL COMMON STOCKS
(COST $1,302,294,634) 1,623,726,584
18
See notes to financial statements.
<PAGE>
- --------------------------------------------------------------------------------
STRONG OPPORTUNITY FUND (continued)
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
- --------------------------------------------------------------------------------
PREFERRED STOCKS 0.1%
Henkel KGaA-Vorzug
(COST $1,906,983) 35,100 $ 1,991,347
SHORT-TERM INVESTMENTS (a) 7.7%
COMMERCIAL PAPER 0.2%
INTEREST BEARING, DUE UPON DEMAND
American Family Financial Services,
Inc., 5.29% $ 441,700 441,700
General Mills, Inc., 5.27% 100 100
Johnson Controls, Inc., 5.31% 1,232,700 1,232,700
Pitney Bowes Credit Corporation, 5.29% 38,100 38,100
Wisconsin Electric Power Company, 5.33% 654,900 654,900
--------------
2,367,500
REPURCHASE AGREEMENT 5.8%
Goldman, Sachs & Company (Dated 6/30/97),
5.75%, Due 7/01/97 (Repurchase
proceeds $102,416,356); Collateralized
by: $96,515,000 United States Treasury
Bonds, 7.50%, Due 11/15/16 (Market
Value $104,525,745) (f) 102,400,000 102,400,000
MONEY MARKET 1.7%
Strong Institutional Money Fund 30,600,000 30,600,000
--------------
TOTAL SHORT-TERM INVESTMENTS
(COST $135,367,500) 135,367,500
--------------
TOTAL INVESTMENTS IN SECURITIES
(COST $1,439,569,117) 99.7% 1,761,085,431
Other Assets and Liabilities, Net 0.3% 5,452,546
--------------
NET ASSETS 100.0% $1,766,537,977
==============
PERCENTAGE OF
COUNTRY DIVERSIFICATION NET ASSETS
- ----------------------------------------------------------------
United States ....................................... 85.4%
United Kingdom ...................................... 3.0
Canada .............................................. 2.9
Netherlands ......................................... 2.1
Switzerland ......................................... 1.4
Bermuda ............................................. 1.4
South Africa ........................................ 1.2
New Zealand ......................................... 0.5
Mexico .............................................. 0.4
Japan ............................................... 0.4
Germany ............................................. 0.3
Brazil .............................................. 0.3
Singapore ........................................... 0.1
Australia ........................................... 0.1
South Korea ......................................... 0.1
Malaysia ............................................ 0.1
Other Assets and Liabilities, Net ................... 0.3
------
Total 100.0%
======
- --------------------------------------------------------------------------------
STRONG MID CAP FUND
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
- --------------------------------------------------------------------------------
COMMON STOCKS 95.8%
AIRLINE 0.2%
Ryanair Holdings PLC ADR (b) 1,200 $ 32,550
AUTO & TRUCK PARTS 1.9%
Borg-Warner Automotive, Inc. 3,500 189,219
Lear Corporation (b) 2,000 88,750
----------
277,969
COMMERCIAL SERVICE 3.9%
Manpower, Inc. 5,600 249,200
Outdoor Systems, Inc. (b) 4,300 164,475
Paychex, Inc. 4,050 153,900
----------
567,575
COMPUTER - PERIPHERAL EQUIPMENT 0.9%
EMC Communications Corporation (b) 3,300 128,700
COMPUTER SERVICE 3.8%
America Online, Inc. (b) 3,700 205,813
HBO & Company 1,600 110,200
National Data Corporation 3,400 147,262
Shared Medical Systems Corporation 1,600 86,400
----------
549,675
COMPUTER SOFTWARE 17.4%
Ascend Communications, Inc. (b) 2,200 86,625
Autodesk, Inc. 5,800 222,213
Baan Company NV (b) 1,900 130,862
Bay Networks, Inc. (b) 3,100 82,344
Cisco Systems, Inc. (b) 2,300 154,387
Cognos, Inc. (b) 5,300 164,962
Computer Associates International, Inc. 2,500 139,219
Compuware Corporation (b) 4,000 191,000
Electronic Arts, Inc. (b) 3,600 121,050
Electronics for Imaging, Inc. (b) 5,100 240,975
McAfee Associates, Inc. (b) 4,900 309,313
PeopleSoft, Inc. (b) 3,100 163,525
Synopsys, Inc. (b) 4,000 147,000
3Com Corporation (b) 3,700 166,500
Veritas Software Corporation (b) 3,800 190,950
----------
2,510,925
COMPUTER SYSTEMS 0.9%
Policy Management Systems Corporation (b) 2,700 126,900
CONSUMER - MISCELLANEOUS 1.3%
Blyth Industries, Inc. (b) 5,400 182,250
COSMETIC & PERSONAL CARE 2.9%
General Nutrition Companies, Inc. (b) 8,600 240,800
Rexall Sundown, Inc. (b) 4,700 183,300
----------
424,100
ELECTRONICS - SEMICONDUCTOR/COMPONENT 8.1%
Altera Corporation (b) 1,000 50,500
LSI Logic Corporation (b) 2,300 73,600
Lam Research Corporation (b) 2,600 96,362
Lattice Semiconductor Corporation (b) 1,600 90,400
Maxim Integrated Products, Inc. (b) 2,400 136,500
National Semiconductor Corporation (b) 5,400 165,375
Novellus Systems, Inc. (b) 1,800 155,700
Teradyne, Inc. (b) 3,100 121,675
Vitesse Semiconductor Corporation (b) 4,100 134,019
Xilinx, Inc. (b) 3,000 147,188
----------
1,171,319
FOOD 1.8%
Interstate Bakeries Corporation 4,400 260,975
19
See notes to financial statements.
<PAGE>
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) June 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
STRONG MID CAP FUND (continued)
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
- --------------------------------------------------------------------------------
HEALTHCARE - DRUG/DIVERSIFIED 3.2%
Dura Pharmaceuticals, Inc. (b) 5,600 $ 223,300
Elan Corporation PLC ADR (b) 2,000 90,500
Watson Pharmaceuticals, Inc. (b) 3,400 143,650
-----------
457,450
HEALTHCARE - INSTRUMENTATION 1.8%
Sofamor/Danek Group, Inc. (b) 2,700 123,525
United States Surgical Corporation 3,700 137,825
-----------
261,350
HEALTHCARE - MEDICAL SUPPLY 1.1%
Pharmaceutical Product Development, Inc. (b) 7,200 158,400
HEALTHCARE - PATIENT CARE 6.1%
Genesis Health Ventures, Inc. (b) 4,000 135,000
PhyCor, Inc. (b) 3,400 117,087
Tenet Healthcare Corporation (b) 8,300 245,369
United Healthcare Corporation 2,500 130,000
Universal Health Services, Inc. Class B (b) 3,100 119,350
Vencor, Inc. (b) 3,300 139,425
-----------
886,231
HEALTHCARE - PRODUCT 0.4%
DePuy, Inc. (b) 2,600 59,800
HOUSEHOLD APPLIANCES & FURNISHINGS 1.2%
Pillowtex Corporation 4,800 105,300
WestPoint Stevens, Inc. (b) 1,800 70,425
-----------
175,725
INSURANCE - LIFE 1.3%
Hartford Life, Inc. Class A (b) 4,900 183,750
INSURANCE - PROPERTY & CASUALTY 0.5%
Frontier Insurance Group, Inc. 1,100 71,225
LEISURE SERVICE 1.1%
Royal Caribbean Cruises, Ltd. 4,600 160,712
MACHINERY - AGRICULTURE 0.6%
Case Corporation 1,300 89,538
MORTGAGE & RELATED SERVICE 0.5%
Countrywide Credit Industries, Inc. 2,400 74,850
OFFICE AUTOMATION 1.1%
Danka Business Systems PLC Sponsored ADR 3,900 159,413
OIL - INTERNATIONAL INTEGRATED 1.8%
Santa Fe International Corporation (b) 7,600 258,400
OIL - NORTH AMERICAN INTEGRATED 1.1%
Sun Company, Inc. 4,800 148,800
OIL WELL EQUIPMENT & SERVICE 4.1%
Diamond Offshore Drilling, Inc. (b) 1,900 148,437
EVI, Inc. (b) 2,000 84,000
Falcon Drilling Company, Inc. (b) 3,300 190,163
Smith International, Inc. (b) 2,700 164,025
-----------
586,625
POLLUTION CONTROL 0.8%
Newpark Resources, Inc. (b) 3,400 114,750
RETAIL - DISCOUNT & VARIETY 3.5%
Consolidated Stores Corporation (b) 4,125 143,344
Dollar Tree Stores, Inc. (b) 3,900 196,462
Family Dollar Stores, Inc. 6,300 171,675
-----------
511,481
RETAIL - RESTAURANT 0.8%
CKE Restaurants, Inc. 3,500 110,687
RETAIL - SPECIALTY 8.5%
Barnes & Noble, Inc. (b) 3,600 154,800
Corporate Express, Inc. (b) 14,950 215,841
Fastenal Company 1,600 78,400
Fingerhut Companies, Inc. 8,100 141,244
Heilig-Meyers Company 7,700 151,112
Intimate Brands, Inc. 9,900 207,900
MSC Industrial Direct Company, Inc. Class A (b) 4,000 160,500
The Men's Wearhouse, Inc. (b) 3,700 116,550
-----------
1,226,347
SHOE & APPAREL MANUFACTURING 2.2%
Jones Apparel Group, Inc. (b) 3,600 171,900
Polo Ralph Lauren Corporation (b) 5,500 150,562
-----------
322,462
TELECOMMUNICATION EQUIPMENT 7.2%
Advanced Fibre Communications, Inc. (b) 2,700 163,012
Aspect Telecommunications Corporation (b) 1,500 33,375
CIENA Corporation (b) 3,500 164,938
Newbridge Networks Corporation (b) 5,700 247,950
Scientific-Atlanta, Inc. 11,200 245,000
Tellabs, Inc. (b) 3,200 178,800
-----------
1,033,075
TELECOMMUNICATION SERVICE 1.3%
WorldCom, Inc. (b) 5,700 182,400
TOBACCO 0.1%
Consolidated Cigar Holdings, Inc. Class A (b) 600 16,650
TRUCKING 2.4%
American Freightways Corporation (b) 4,800 75,000
CNF Transportation, Inc. 4,500 145,125
Yellow Corporation (b) 5,700 127,538
-----------
347,663
-----------
TOTAL COMMON STOCKS (COST $11,832,283) 13,830,722
SHORT-TERM INVESTMENTS (a) 0.9%
COMMERCIAL PAPER 0.9%
INTEREST BEARING, DUE UPON DEMAND
Johnson Controls, Inc., 5.31% $75,100 75,100
Wisconsin Electric Power Company, 5.33% 53,600 53,600
-----------
TOTAL SHORT-TERM INVESTMENTS
(COST $128,700) 128,700
-----------
TOTAL INVESTMENTS IN SECURITIES
(COST $11,960,983) 96.7% 13,959,422
Other Assets and Liabilities, Net 3.3% 482,940
-----------
NET ASSETS 100.0% $14,442,362
===========
PERCENTAGE OF
COUNTRY DIVERSIFICATION NET ASSETS
- ---------------------------------------------------------------
United States ....................................... 93.8%
United Kingdom ...................................... 1.4%
Netherlands ......................................... 0.9%
Ireland ............................................. 0.6%
Other Assets and Liabilities, Net ................... 3.3%
------
Total 100.0%
======
20
See notes to financial statements.
<PAGE>
- --------------------------------------------------------------------------------
STRONG COMMON STOCK FUND
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
- --------------------------------------------------------------------------------
COMMON STOCKS 95.4%
AIRLINE 0.3%
Air New Zealand, Ltd. Class B 750,000 $ 2,294,325
Korean Airline Company, Ltd. (b) 38,000 716,253
Singapore Airlines, Ltd. (Fgn Reg) 110,000 984,960
--------------
3,995,538
BANK - MONEY CENTER 0.6%
Canadian Imperial Bank of Commerce 82,000 2,069,897
Deutsche Bank AG 37,000 2,160,630
Fuji Bank, Ltd. 136,000 2,040,652
Grupo Financiero Banamex Accival SA de CV (b) 885,000 2,326,598
--------------
8,597,777
BANK - REGIONAL 2.2%
City National Corporation 630,000 15,159,375
Old Kent Financial Corporation 304,500 16,443,000
--------------
31,602,375
BANK - SUPER REGIONAL 1.3%
BankBoston Corporation 250,000 18,015,625
BEVERAGE - SOFT DRINK 0.1%
Coca-Cola Amatil, Ltd. 85,000 1,102,202
CHEMICAL - SPECIALTY 1.1%
M.A. Hanna Company 562,900 16,218,556
CLOSED-END FUND 0.1%
Morgan Stanley Emerging Markets Fund, Inc. 75,000 1,340,625
The R.O.C. Taiwan Fund 45,788 535,147
--------------
1,875,772
COMMERCIAL SERVICE 2.6%
Pittston Company Brinks Group 590,000 17,700,000
Rollins Truck Leasing Corporation 1,275,000 18,965,625
--------------
36,665,625
COMPUTER - PERIPHERAL EQUIPMENT 2.0%
Komag, Inc. (b) 770,000 12,608,750
Seagate Technology, Inc. (b) 440,000 15,482,500
--------------
28,091,250
COMPUTER - PERSONAL & WORKSTATION 1.8%
Data General Corporation (b) 1,000,000 26,000,000
COMPUTER SOFTWARE 2.5%
Sybase, Inc. (b) 1,265,000 18,816,875
Symbol Technologies, Inc. (b) 517,200 17,390,850
--------------
36,207,725
CONGLOMERATE 0.0%
Benpres Holdings Corporation Sponsored GDR (b) 50,000 357,500
DIVERSIFIED OPERATIONS 2.2%
Canadian Pacific, Ltd. 167,800 4,771,812
Harsco Corporation 476,000 19,278,000
Laidlaw, Inc. Class B (b) 511,000 7,058,188
Laidlaw, Inc. Subscription Receipts (each
representing the right to receive one Common
Share of Laidlaw, Inc. at a price of 18.85 CAD
per share payable on an installment basis)
(Acquired 6/16/97; Cost $341,253) (b) (d) (e) 50,000 359,445
--------------
31,467,445
ELECTRIC POWER 0.1%
Centrais Electricas Brasileiras SA Sponsored ADR 31,000 918,375
ELECTRICAL EQUIPMENT 1.7%
BW/IP, Inc. 345,000 7,007,813
Molex, Inc. Class A 511,000 17,821,125
--------------
24,828,938
ELECTRONIC PARTS DISTRIBUTION 1.1%
Marshall Industries (b) 405,000 15,086,250
ELECTRONICS - SEMICONDUCTOR/COMPONENT 4.0%
Cypress Semiconductor, Inc. (b) 1,240,000 17,980,000
Ibiden Company, Ltd. 112,000 1,612,143
Kemet Corporation (b) 757,500 18,842,813
SGS-THOMSON Microelectronics NV (b) 225,000 18,000,000
--------------
56,434,956
FINANCE - MISCELLANEOUS 0.2%
Credit Communal Holding Dexia 6,400 687,092
Hong Leong Finance, Ltd. (Fgn Reg) 200,000 568,031
Japan Associated Finance 15,000 1,177,702
--------------
2,432,825
FOOD 2.5%
Dole Food Company, Inc. 383,300 16,386,075
Lion Nathan, Ltd. 575,000 1,458,001
Quaker Oats Company 390,000 17,501,250
--------------
35,345,326
HEALTHCARE - BIOMEDICAL/GENETIC 1.5%
Centocor, Inc. (b) 500,000 15,531,250
Immunex Corporation (b) 180,000 6,525,000
--------------
22,056,250
HEALTHCARE - DRUG/DIVERSIFIED 1.2%
Novartis AG Sponsored ADR 205,000 16,444,844
HEALTHCARE - INSTRUMENTATION 1.2%
Beckman Instruments, Inc. 360,000 17,370,000
HEALTHCARE - MEDICAL SUPPLY 1.3%
Sybron International Corporation (b) 470,000 18,741,250
HEALTHCARE - PATIENT CARE 2.6%
Tenet Healthcare Corporation (b) 528,500 15,623,781
WellPoint Health Networks, Inc. (b) 470,000 21,561,250
--------------
37,185,031
HOUSEHOLD APPLIANCES & FURNISHINGS 1.8%
Philips Electronics NV ADR 140,000 10,062,500
Premark International, Inc. 590,000 15,782,500
--------------
25,845,000
HOUSING RELATED 2.5%
Ferro Corporation 426,700 15,814,569
RPM, Inc. 1,050,000 19,293,750
--------------
35,108,319
INSURANCE - MULTI-LINE 1.2%
Horace Mann Educators Corporation 355,000 17,395,000
LEISURE SERVICE 0.1%
AAPC, Ltd. 2,000,000 1,326,864
MACHINERY - MISCELLANEOUS 2.1%
Briggs & Stratton Corporation 300,000 15,000,000
Durco International, Inc. 500,000 14,625,000
--------------
29,625,000
MEDIA - PUBLISHING 0.3%
Torstar Corporation - Class B 153,000 4,781,943
MEDIA - RADIO/TV 6.6%
Cox Communications, Inc. Class A (b) 745,000 17,880,000
Flextech PLC (b) 420,000 4,494,338
Grupo Televisa SA GDS (b) 38,000 1,154,250
International Family Entertainment,
Inc. Class B (b) 535,000 18,390,625
LIN Television Corporation (b) 328,000 14,473,000
Tele-Communications, Inc. Class A (b) 1,315,000 19,560,625
Tele-Communications International, Inc.
Class A (b) 1,207,500 18,640,781
--------------
94,593,619
NATURAL GAS DISTRIBUTION 1.3%
ENSERCH Corporation 825,000 18,356,250
OIL - NORTH AMERICAN EXPLORATION
& PRODUCTION 6.7%
Devon Energy Corporation 515,000 18,926,250
Enron Oil & Gas Company 860,000 15,587,500
Enserch Exploration, Inc. (b) 344,200 3,764,688
Forcenergy, Inc. (b) 610,000 18,528,750
21
See notes to financial statements.
<PAGE>
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) June 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
STRONG COMMON STOCK FUND (continued)
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
- --------------------------------------------------------------------------------
H S Resources, Inc. (b) 491,300 $ 6,939,612
Harken Energy Corporation (b) 1,800,000 12,600,000
Noble Affiliates, Inc. 499,100 19,308,931
--------------
95,655,731
OIL - NORTH AMERICAN INTEGRATED 2.4%
Unocal Corporation 405,000 15,719,063
Valero Energy Corporation 515,000 18,668,750
--------------
34,387,813
OIL WELL EQUIPMENT & SERVICE 3.9%
Falcon Drilling Company, Inc. (b) 350,000 20,168,750
Global Industries, Ltd. (b) 804,500 18,792,617
Offshore Logistics, Inc. (b) 875,000 16,515,625
--------------
55,476,992
PAPER & FOREST PRODUCTS 1.4%
Consolidated Papers, Inc. 360,000 19,440,000
Fletcher Challenge, Ltd. Forestry Division 828,000 1,204,551
--------------
20,644,551
POLLUTION CONTROL 1.1%
Allwaste, Inc. (b) 800,000 7,600,000
Philip Services Corporation (b) 541,700 8,599,488
--------------
16,199,488
PRECIOUS METAL/GEM/STONE 2.0%
De Beers Consolidated Mines, Ltd. ADR 450,000 16,621,875
Newmont Mining Company 306,600 11,957,404
--------------
28,579,279
REAL ESTATE 1.7%
Apartment Investment & Management Company
Class A 580,000 16,385,000
Castle & Cooke, Inc. (b) 484,401 8,022,892
--------------
24,407,892
RETAIL - DEPARTMENT STORE 2.4%
Dillards, Inc. 505,000 17,485,625
Federated Department Stores, Inc. (b) 483,000 16,784,250
--------------
34,269,875
RETAIL - FOOD CHAIN 1.4%
American Stores Company 360,000 17,775,000
Santa Isabel SA Sponsored ADR 55,200 1,780,200
--------------
19,555,200
RETAIL - RESTAURANT 3.4%
IHOP Corporation (b) (g) 500,000 15,500,000
Outback Steakhouse, Inc. (b) 735,000 17,777,813
Sbarro, Inc. 550,000 15,262,500
--------------
48,540,313
RETAIL - SPECIALTY 0.6%
Cambridge Shopping Centers, Ltd. 525,000 4,487,179
Musicland Stores Corporation (b) 1,446,600 3,887,737
--------------
8,374,916
SAVINGS & LOAN 1.2%
H.F. Ahmanson & Company 390,000 16,770,000
SHOE & APPAREL MANUFACTURING 3.3%
Nautica Enterprises, Inc. (b) 750,000 19,828,125
Nine West Group, Inc. (b) 105,000 4,009,688
Unifi, Inc. 610,000 22,798,750
--------------
46,636,563
SOAP & CLEANING PREPARATION 1.3%
Ecolab, Inc. 400,000 19,100,000
TELECOMMUNICATION EQUIPMENT 1.3%
Belden, Inc. 550,000 18,734,375
TELECOMMUNICATION SERVICE 11.2%
Aerial Communications, Inc. (b) 1,400,000 11,900,000
AirTouch Communications, Inc. (b) 675,000 18,478,125
Cable & Wireless Communications PLC (b) 360,000 1,947,114
Cable & Wireless Communications PLC ADR (b) 600,000 16,125,000
LCI International, Inc. (b) 741,000 16,209,375
NTL, Inc. (b) 725,000 18,034,375
Nextel Communications, Inc. Class A (b) 1,000,000 18,937,500
Nippon Telegraph & Telephone Corporation 3,600 3,454,593
Paging Network, Inc. (b) 1,600,000 14,050,000
Telecommunicacoes Brasileiras SA Sponsored ADR 18,000 2,731,500
Telefonica del Peru SA Sponsored ADR
(representing Class B Shares) 54,000 1,414,125
U.S. West, Inc. Media Group (b) 885,000 17,921,250
United States Cellular Corporation (b) 643,800 19,072,575
--------------
160,275,532
--------------
TOTAL COMMON STOCKS (COST $1,081,899,672) 1,361,681,950
PREFERRED STOCKS 0.1%
Henkel KGaA-Vorzug (COST $1,921,150) 35,000 1,985,673
CORPORATE BONDS 0.0%
Musicland Group, Inc. Senior Subordinated
Notes, 9.00%, Due 6/15/03 (COST $700,011) $ 1,000,000 705,000
SHORT-TERM INVESTMENTS (a) 4.6%
COMMERCIAL PAPER 0.0%
INTEREST-BEARING, DUE UPON DEMAND
General Mills, Inc., 5.27% 100 100
Johnson Controls, Inc., 5.31% 331,400 331,400
Wisconsin Electric Power Company, 5.33% 309,500 309,500
--------------
641,000
MONEY MARKET 2.7%
Strong Institutional Money Fund 38,000,000 38,000,000
REPURCHASE AGREEMENT 1.8%
Goldman, Sachs & Company (Dated 6/30/97),
5.75%, Due 7/01/97 (Repurchase proceeds
$25,704,105); Collateralized by: $23,220,000
United States Treasury Bonds, 7.625%,
Due 2/15/25 (Market Value $26,216,907) (f) 25,700,000 25,700,000
UNITED STATES GOVERNMENT ISSUES 0.1%
United States Treasury Bills, Due 9/25/97 (c) 1,025,000 1,012,684
--------------
TOTAL SHORT-TERM INVESTMENTS
(COST $65,353,798) 65,353,684
--------------
TOTAL INVESTMENTS IN SECURITIES
(COST $1,149,874,631) 100.1% 1,429,726,307
Other Assets and Liabilities, Net (0.1%) (1,988,920)
--------------
NET ASSETS 100.0% $1,427,737,387
==============
FUTURES
- -------
UNDERLYING
EXPIRATION FACE AMOUNT UNREALIZED
DATE AT VALUE APPRECIATION
- --------------------------------------------------------------------------------
Sold:
64 S&P 500 9/97 $28,488,000 $152,950
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
- -------------------------------------------
SETTLEMENT VALUE UNREALIZED
DATE IN USD APPRECIATION
- --------------------------------------------------------------------------------
Sold:
15,192,420 CHF 8/25/97 $10,466,848 $433,152
PERCENTAGE OF
COUNTRY DIVERSIFICATION NET ASSETS
- ----------------------------------------------------------------
United States ....................................... 89.5%
Canada .............................................. 2.3
United Kingdom ...................................... 1.6
France .............................................. 1.2
South Africa ........................................ 1.1
Switzerland ......................................... 1.1
Netherlands ......................................... 0.7
Japan ............................................... 0.6
New Zealand ......................................... 0.4
Germany ............................................. 0.3
Brazil .............................................. 0.3
22
See notes to financial statements.
<PAGE>
- --------------------------------------------------------------------------------
STRONG COMMON STOCK FUND (continued)
- --------------------------------------------------------------------------------
PERCENTAGE OF
COUNTRY DIVERSIFICATION (continued) NET ASSETS
- --------------------------------------------------------------------------------
Mexico .............................................. 0.2%
Australia ........................................... 0.2
Chile ............................................... 0.1
Singapore ........................................... 0.1
Peru ................................................ 0.1
Belgium ............................................. 0.1
South Korea ......................................... 0.1
Other ............................................... 0.1
Other Assets and Liabilities, Net ................... (0.1)
------
Total 100.0%
======
- --------------------------------------------------------------------------------
STRONG GROWTH FUND
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
- --------------------------------------------------------------------------------
COMMON STOCKS 98.7%
AIRLINE 0.7%
Midwest Express Holdings, Inc. (b) 400,000 $10,950,000
BANK - REGIONAL 1.3%
First Bank System, Inc. 90,000 7,683,750
Northern Trust Company 260,000 12,577,500
------------
20,261,250
BANK - SUPER REGIONAL 0.6%
Norwest Corporation 150,000 8,437,500
BEVERAGE - SOFT DRINK 1.6%
The Coca-Cola Company 115,000 7,762,500
Coca-Cola FEMSA, SA de CV ADR 50,000 2,581,250
PepsiCo, Inc. (b) 350,000 13,146,875
------------
23,490,625
BROKERAGE & INVESTMENT MANAGEMENT 2.3%
Franklin Resources, Inc. 300,000 21,768,750
The Charles Schwab Corporation 300,000 12,206,250
------------
33,975,000
CHEMICAL 0.3%
Monsanto Company 100,000 4,306,250
COMMERCIAL SERVICE 5.2%
ABR Information Services, Inc. (b) 200,000 5,800,000
Accustaff, Inc. (b) 500,000 11,843,750
Apollo Group, Inc. Class A (b) 200,000 7,050,000
Billing Information Concepts Corporation (b) 150,000 5,231,250
Corrections Corporation America (b) 225,000 8,943,750
Outdoor Systems, Inc. (b) 400,000 15,300,000
Paychex, Inc. 150,000 5,700,000
Robert Half International, Inc. (b) 250,000 11,765,625
Romac International, Inc. (b) 202,200 6,622,050
------------
78,256,425
COMPUTER - PERSONAL & WORKSTATION 1.0%
Dell Computer Corporation (b) 130,000 15,266,875
COMPUTER SERVICE 4.5%
America Online, Inc. (b) 155,000 8,621,875
Fiserv, Inc. (b) 350,000 15,618,750
HBO & Company 150,000 10,331,250
National Data Corporation 185,000 8,012,812
National Techteam, Inc. (b) 200,000 4,275,000
Sykes Enterprises, Inc. (b) 825,000 21,450,000
------------
68,309,687
COMPUTER SOFTWARE 11.4%
Baan Company NV (b) 275,000 18,940,625
CBT Group PLC ADR (b) 160,000 10,100,000
Cisco Systems, Inc. (b) 300,000 20,137,500
Compuware Corporation (b) 400,000 19,100,000
Great Plains Software, Inc. (b) 210,000 5,670,000
Keane, Inc. (b) 100,000 5,200,000
McAfee Associates, Inc. (b) 350,000 22,093,750
Microsoft Corporation (b) 160,000 20,220,000
PeopleSoft, Inc. (b) 225,000 11,868,750
3Com Corporation (b) 35,000 1,575,000
Transaction Systems Architects, Inc. (b) 70,000 2,415,000
Veritas Software Corporation (b) 185,000 9,296,250
Visio Corporation (b) 350,000 24,675,000
------------
171,291,875
COMPUTER SYSTEMS 0.7%
Oracle Systems Corporation (b) 200,000 10,075,000
COSMETIC & PERSONAL CARE 0.6%
The Gillette Company 100,000 9,475,000
DIVERSIFIED OPERATIONS 1.1%
Corning, Inc. 300,000 16,687,500
ELECTRICAL EQUIPMENT 1.0%
General Electric Company 225,000 14,709,375
ELECTRONIC INSTRUMENTATION 0.7%
Perkin Elmer Corporation 125,000 9,945,312
ELECTRONIC PARTS DISTRIBUTION 0.9%
Kent Electronics Corporation (b) 350,000 12,840,625
ELECTRONICS - SEMICONDUCTOR/COMPONENT 6.8%
ASM Lithography Holding NV (b) 175,000 10,237,500
Altera Corporation (b) 300,000 15,150,000
Applied Materials, Inc. (b) 200,000 14,162,500
Intel Corporation 120,000 17,017,500
KLA-Tencor Corporation (b) 150,000 7,312,500
PMC-Sierra, Inc. (b) 230,000 6,037,500
Sipex Corporation (b) (g) 200,000 7,250,000
Teradyne, Inc. (b) 300,000 11,775,000
Uniphase Corporation (b) 225,000 13,106,250
------------
102,048,750
ENERGY - ALTERNATE SOURCE 0.4%
Calenergy Company, Inc. (b) 175,000 6,650,000
FINANCE - MISCELLANEOUS 0.8%
American Express Company 150,000 11,175,000
SunAmerica, Inc. 25,000 1,218,750
------------
12,393,750
HEALTHCARE - DRUG/DIVERSIFIED 8.1%
Abbott Laboratories 150,000 10,012,500
Dura Pharmaceuticals, Inc. (b) 175,000 6,978,125
Elan Corporation PLC ADR (b) 250,000 11,312,500
Eli Lilly & Company 260,000 28,421,250
Pfizer, Inc. 200,000 23,900,000
Warner-Lambert Company 325,000 40,381,250
------------
121,005,625
HEALTHCARE - INSTRUMENTATION 1.5%
Medtronic, Inc. 275,000 22,275,000
HEALTHCARE - MEDICAL SUPPLY 3.0%
Amerisource Health Corporation Class A (b) 175,000 8,728,125
McKesson Corporation 150,000 11,625,000
Parexel International Corporation (b) 400,000 12,700,000
Quest Medical, Inc. (b) 275,000 2,509,375
Sybron International Corporation (b) 250,000 9,968,750
------------
45,531,250
23
See notes to financial statements.
<PAGE>
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) June 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
STRONG GROWTH FUND (continued)
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
- --------------------------------------------------------------------------------
HEALTHCARE - PATIENT CARE 2.4%
HEALTHSOUTH Corporation (b) 800,000$ 19,950,000
Oxford Health Plans, Inc. (b) 100,000 7,175,000
Vencor, Inc. (b) 200,000 8,450,000
-------------
35,575,000
HEALTHCARE - PRODUCT 1.0%
Guidant Corporation 175,000 14,875,000
HOUSEHOLD APPLIANCES & FURNISHINGS 1.6%
Sunbeam Corporation 625,000 23,593,750
INSURANCE - DIVERSIFIED 1.2%
Travelers Group, Inc. 275,000 17,342,188
INSURANCE - LIFE 2.4%
Conseco, Inc. 400,000 14,800,000
Hartford Life, Inc. Class A (b) 350,000 13,125,000
Western National Corporation 325,000 8,714,062
-------------
36,639,062
INSURANCE - MULTI-LINE 0.8%
MGIC Investment Corporation 250,000 11,984,375
LEISURE SERVICE 2.5%
CapStar Hotel Company (b) 185,000 5,920,000
Carnival Corporation Class A 200,000 8,250,000
Regal Cinemas, Inc. (b) 200,000 6,600,000
Wyndham Hotel Corporation (b) 500,000 16,312,500
-------------
37,082,500
MACHINERY - TRANSPORTATION EQUIPMENT
& PARTS 0.3%
Miller Industries, Inc. (b) 300,000 4,800,000
MEDIA - PUBLISHING 0.5%
Central Newspapers, Inc. Class A 115,500 8,272,688
MEDIA - RADIO/TV 2.8%
Clear Channel Communications, Inc. (b) 325,000 19,987,500
Evergreen Media Corporation Class A (b) 225,000 10,040,625
Heftel Broadcasting Corporation Class A (b) 100,000 5,525,000
Westwood One, Inc. (b) 200,000 6,450,000
-------------
42,003,125
METAL PRODUCTS & FABRICATION 0.7%
Illinois Tool Works, Inc. 200,000 9,987,500
OFFICE AUTOMATION 3.6%
Danka Business Systems PLC Sponsored ADR 805,000 32,904,375
Xerox Corporation 275,000 21,690,625
-------------
54,595,000
OIL - NORTH AMERICAN EXPLORATION &
PRODUCTION 0.9%
Gulf Canada Resources, Ltd. ADR (b) 1,698,000 14,114,625
OIL WELL EQUIPMENT & SERVICE 6.5%
Camco International, Inc. 200,000 10,950,000
Cooper Cameron Corporation (b) 500,000 23,375,000
EVI, Inc. (b) 450,000 18,900,000
Falcon Drilling Company, Inc. (b) 150,000 8,643,750
Global Marine, Inc. (b) 250,000 5,812,500
Schlumberger, Ltd. 125,800 15,725,000
Smith International, Inc. (b) 225,000 13,668,750
-------------
97,075,000
PERSONAL & COMMERCIAL LENDING 0.9%
Firstplus Financial Group (b) 400,000 13,600,000
POLLUTION CONTROL 0.4%
Newpark Resources, Inc. (b) 160,400 5,413,500
REAL ESTATE 1.1%
Patriot American Hospitality, Inc. 288,100 7,346,550
Starwood Lodging Trust 200,000 8,537,500
-------------
15,884,050
RETAIL - DEPARTMENT STORE 1.7%
Kohl's Corporation (b) 350,000 18,528,125
Fred Meyer, Inc. (b) 125,000 6,460,938
-------------
24,989,063
RETAIL - DISCOUNT & VARIETY 1.9%
Consolidated Stores Corporation (b) 250,000 8,687,500
Dollar General Corporation 100,000 3,750,000
Dollar Tree Stores, Inc. (b) 225,000 11,334,375
ShopKo Stores, Inc. 193,600 4,936,800
-------------
28,708,675
RETAIL - DRUG STORE 0.5%
Walgreen Company 150,000 8,043,750
RETAIL - MAJOR CHAIN 0.3%
Costco Companies, Inc. (b) 150,000 4,931,250
RETAIL - RESTAURANT 0.5%
PJ America, Inc. (b) (g) 173,500 2,949,500
Starbucks Corporation (b) 100,000 3,893,750
-------------
6,843,250
RETAIL - SPECIALTY 2.9%
Eagle Hardware & Garden, Inc. (b) 250,000 5,718,750
Fastenal Company 189,200 9,270,800
The Home Depot, Inc. 270,000 18,613,125
Staples, Inc. (b) 450,000 10,462,500
-------------
44,065,175
SAVINGS & LOAN 1.1%
Washington Mutual, Inc. 275,000 16,431,250
SHOE & APPAREL MANUFACTURING 1.3%
Jones Apparel Group, Inc. (b) 175,000 8,356,250
Wolverine World Wide, Inc. 375,000 11,390,625
-------------
19,746,875
SOAP & CLEANING PREPARATION 0.4%
The Procter & Gamble Company 45,000 6,356,250
TELECOMMUNICATION EQUIPMENT 3.1%
ADC Telecommunications, Inc. (b) 150,000 5,006,250
Nokia Corporation Sponsored ADR 185,000 13,643,750
Tellabs, Inc. (b) 500,000 27,937,500
-------------
46,587,500
TELECOMMUNICATION SERVICE 0.2%
WorldCom, Inc. (b) 80,000 2,560,000
TOBACCO 0.7%
Philip Morris Companies, Inc. 250,000 11,093,750
-------------
TOTAL COMMON STOCKS (COST $1,165,447,990) 1,481,376,825
CONVERTIBLE PREFERRED STOCKS 0.1%
Crystal Dynamics, Inc. Series D (b) (d)
(COST $1,000,005) 133,334 1,000,005
24
See notes to financial statements.
<PAGE>
- --------------------------------------------------------------------------------
STRONG GROWTH FUND (continued)
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS (a) 1.4%
COMERCIAL PAPER 0.0%
INTEREST BEARING, DUE UPON DEMAND
General Mills, Inc., 5.27% $ 100 $ 100
Wisconsin Electric Power Company, 5.33% 532,600 532,600
--------------
532,700
REPURCHASE AGREEMENT 1.4%
Goldman, Sachs & Company (Dated 6/30/97),
5.75%, Due 7/01/97 (Repurchase proceeds
$21,403,418); Collateralized by: $17,560,000
United States Treasury Bonds, 10.75%,
Due 2/15/03 (Market value $21,844,640) (f) 21,400,000 21,400,000
--------------
TOTAL SHORT-TERM INVESTMENTS
(COST $21,932,700) 21,932,700
--------------
TOTAL INVESTMENTS IN SECURITIES
(COST $1,188,380,695) 100.2% 1,504,309,530
Other Assets and Liabilities, Net (0.2%) (3,755,082)
--------------
NET ASSETS 100.0% $1,500,554,448
==============
PERCENTAGE OF
COUNTRY DIVERSIFICATION NET ASSETS
- ----------------------------------------------------------------
United States ....................................... 92.7%
United Kingdom ...................................... 2.2
Netherlands ......................................... 1.9
Ireland ............................................. 1.4
Canada .............................................. 0.9
Finland ............................................. 0.9
Mexico .............................................. 0.2
Other Assets & Liabilities, Net ..................... (0.2)
------
Total 100.0%
======
- --------------------------------------------------------------------------------
STRONG DISCOVERY FUND
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
- --------------------------------------------------------------------------------
COMMON STOCKS 93.9%
AEROSPACE & DEFENSE 0.8%
Hexcel Corporation (b) 130,700 $ 2,254,575
UNC, Inc. (b) 45,300 662,513
-----------
2,917,088
BANK - MONEY CENTER 2.2%
BankAmerica Corporation 29,800 1,923,963
Chase Manhattan Corporation 32,000 3,106,000
Citicorp 30,000 3,616,875
-----------
8,646,838
COMMERCIAL SERVICE 7.3%
Accustaff, Inc. (b) 129,801 3,074,661
American Oncology Resources, Inc. (b) 30,300 511,313
Bacou U.S.A., Inc. (b) 78,700 1,278,875
Budget Group, Inc. Class A (b) 45,900 1,583,550
Consolidated Graphics, Inc. (b) 116,700 4,872,225
Getty Communications PLC Sponsored ADR (b) 141,900 2,093,025
Individual, Inc. (b) 123,300 493,200
Iron Mountain, Inc. (b) 14,100 423,000
Lason Holdings, Inc. (b) 3,500 98,437
Outdoor Systems, Inc. (b) 78,000 2,983,500
Pittston Company Brinks Group 76,500 2,295,000
Registry, Inc. (b) 25,800 1,186,800
Rollins Truck Leasing Corporation 80,000 1,190,000
The Sabre Group Holdings, Inc. (b) 6,000 162,750
Sitel Corporation (b) 150,400 3,102,000
Universal Outdoor Holdings, Inc. (b) 80,800 2,817,900
-----------
28,166,236
COMPUTER - MAINFRAME 1.7%
International Business Machines Corporation 73,000 6,583,687
COMPUTER - PERIPHERAL EQUIPMENT 0.9%
MICROS Systems, Inc. (b) 37,100 1,558,200
Storage Technology Corporation (b) 46,800 2,082,600
-----------
3,640,800
COMPUTER - PERSONAL & WORKSTATION 1.4%
Compaq Computer Corporation (b) 53,000 5,260,250
COMPUTER SERVICE 2.7%
America Online, Inc. (b) 67,300 3,743,563
Ceridian Corporation (b) 9,000 380,250
Fiserv, Inc. (b) 67,000 2,989,875
National Techteam, Inc. (b) 53,900 1,152,112
Sykes Enterprises, Inc. (b) 85,500 2,223,000
-----------
10,488,800
COMPUTER SOFTWARE 3.8%
Ascend Communications, Inc. (b) 10,000 393,750
Computer Associates International, Inc. 53,000 2,951,437
Emulex Corporation (b) 17,700 269,925
Hummingbird Communications, Ltd. (b) 70,700 1,816,106
IONA Technologies PLC ADR (b) 41,900 827,525
McAfee Associates, Inc. (b) 58,900 3,718,063
Microsoft Corporation (b) 15,000 1,895,625
Sterling Commerce, Inc. (b) 80,800 2,656,300
-----------
14,528,731
CONSUMER - MISCELLANEOUS 1.1%
Equity Corporation International (b) 30,000 725,625
Service Corporation International 80,000 2,630,000
Stewart Enterprises, Inc. Class A 19,300 810,600
-----------
4,166,225
DIVERSIFIED OPERATIONS 0.1%
National Service Industries, Inc. 8,200 399,237
ELECTRICAL EQUIPMENT 0.7%
Berg Electronics Corporation (b) 55,000 1,976,563
Westinghouse Electric Corporation 35,400 818,625
-----------
2,795,188
ELECTRONIC PARTS DISTRIBUTION 1.4%
Kent Electronics Corporation (b) 142,400 5,224,300
ELECTRONICS - SEMICONDUCTOR/COMPONENT 0.8%
General Cable Corporation (b) 20,000 512,500
Intel Corporation 12,500 1,772,656
Micron Technology, Inc. (b) 13,000 519,188
Uniphase Corporation (b) 4,700 273,775
-----------
3,078,119
FINANCE - MISCELLANEOUS 1.9%
American Express Company 51,000 3,799,500
Checkfree Corporation (b) 78,600 1,385,325
PMT Services, Inc. (b) 134,700 2,054,175
-----------
7,239,000
FOOD 0.1%
Lancaster Colony Corporation 8,100 391,837
HEALTHCARE - BIOMEDICAL/GENETIC 0.2%
Ortec International, Inc. (Acquired 10/21/96;
Cost $524,800) (b) (d) 80,000 576,000
HEALTHCARE - DRUG/DIVERSIFIED 1.4%
Halsey Drug Company, Inc. (b) (g) 857,490 3,965,891
Halsey Drug Company, Inc. (Acquired 10/01/96;
Cost $9,165) (b) (d) (g) 2,820 11,738
Ivax Corporation (b) 135,400 1,514,788
-----------
5,492,417
25
See notes to financial statements.
<PAGE>
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) June 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
STRONG DISCOVERY FUND (continued)
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
- --------------------------------------------------------------------------------
HEALTHCARE - MEDICAL SUPPLY 10.0%
Becton, Dickinson & Company 27,000 $ 1,366,875
Cohr, Inc. (b) 202,600 3,798,750
Covance, Inc. (b) 70,000 1,351,875
Dentsply International, Inc. 135,000 6,615,000
McKesson Corporation 95,300 7,385,750
NCS Healthcare, Inc. Class A (b) 49,900 1,515,712
Omnicare, Inc. 24,700 774,962
Steris Corporation (b) 129,900 4,855,013
Suburban Ostomy Supply Company, Inc. (b) 463,800 4,348,125
Sybron International Corporation (b) 165,900 6,615,263
-----------
38,627,325
HEALTHCARE - PATIENT CARE 1.2%
United Dental Care, Inc. (b) 316,400 4,746,000
HEALTHCARE - PRODUCT 1.2%
Baxter International, Inc. 13,000 679,250
Boston Scientific Corporation (b) 30,000 1,843,125
Cytyc Corporation (b) 15,000 406,875
Sabratek Corporation (b) 66,400 1,859,200
-----------
4,788,450
HOUSEHOLD APPLIANCES & FURNISHINGS 0.7%
Harman International Industries, Inc. 51,900 2,186,288
Newell Companies, Inc. 7,800 309,075
Sunbeam Corporation 9,400 354,850
-----------
2,850,213
HOUSING RELATED 0.7%
Watsco, Inc. 111,300 2,782,500
INSURANCE - LIFE 0.4%
Conseco, Inc. 40,000 1,480,000
INSURANCE - MULTI-LINE 0.4%
MGIC Investment Corporation 27,800 1,332,662
INSURANCE - PROPERTY & CASUALTY 0.1%
Hartford Financial Services Group, Inc. 5,800 479,950
LEISURE PRODUCT 1.8%
Action Performance Companies, Inc. (b) 9,800 237,650
Harley-Davidson, Inc. 120,300 5,766,881
SCP Pool Corporation (b) 41,000 866,125
-----------
6,870,656
LEISURE SERVICE 2.2%
Candlewood Hotel Company, Inc. (b) 142,800 1,195,950
Host Marriott Corporation (b) 42,300 753,469
International Game Technology 197,300 3,502,075
Promus Hotel Corporation (b) 35,100 1,360,125
Regal Cinemas, Inc. (b) 55,100 1,818,300
-----------
8,629,919
MACHINE TOOL 1.2%
Applied Power, Inc. 87,800 4,532,675
MACHINERY - MISCELLANEOUS 1.0%
Greenwich Air Services, Inc. 128,850 3,744,703
MACHINERY - TRANSPORTATION EQUIPMENT
& PARTS 0.9%
Miller Industries, Inc. (b) 204,200 3,267,200
MEDIA - RADIO/TV 0.9%
Clear Channel Communications, Inc. (b) 59,000 3,628,500
NATURAL GAS DISTRIBUTION 0.1%
WICOR, Inc. 13,425 522,736
OFFICE AUTOMATION 4.6%
Danka Business Systems PLC Sponsored ADR 405,950 16,593,206
Xerox Corporation 13,300 1,049,038
-----------
17,642,244
OIL - INTERNATIONAL INTEGRATED 0.3%
Santa Fe International Corporation (b) 34,300 1,166,200
OIL - NORTH AMERICAN EXPLORATION
& PRODUCTION 5.9%
Ocean Energy, Inc. (b) 373,600 17,279,000
Union Pacific Resources Group, Inc. 218,700 5,440,163
-----------
22,719,163
OIL WELL EQUIPMENT & SERVICE 5.8%
Cooper Cameron Corporation (b) 37,000 1,729,750
ENSCO International, Inc. (b) 53,700 2,832,675
Global Marine, Inc. (b) 55,000 1,278,750
Marine Drilling Companies, Inc. (b) 170,000 3,336,250
Nabors Industries, Inc. (b) 105,000 2,625,000
Noble Drilling Corporation (b) 290,000 6,543,125
Rowan Companies, Inc. (b) 19,600 552,475
Schlumberger, Ltd. 28,000 3,500,000
-----------
22,398,025
PERSONAL & COMMERCIAL LENDING 1.9%
Associates First Capital Corporation 100,000 5,550,000
Household International, Inc. 14,500 1,702,844
-----------
7,252,844
POLLUTION CONTROL 0.0%
Waste Industries, Inc. (b) 6,900 121,612
RAILROAD 1.0%
Burlington Northern Santa Fe Corporation 45,001 4,044,465
REAL ESTATE 0.1%
Charles E. Smith Residential Realty, Inc. 13,200 381,150
RETAIL - DISCOUNT & VARIETY 1.5%
Consolidated Stores Corporation (b) 130,425 4,532,269
ShopKo Stores, Inc. 47,100 1,201,050
-----------
5,733,319
RETAIL - DRUG STORE 0.5%
Rite Aid Corporation 40,000 1,995,000
RETAIL - RESTAURANT 3.0%
Casa Ole Restaurants, Inc. (b) 135,000 1,248,750
Quality Dining, Inc. (b) 340,225 1,594,805
Rainforest Cafe, Inc. (b) 339,600 8,617,350
-----------
11,460,905
RETAIL - SPECIALTY 12.1%
Borders Group, Inc. (b) 79,100 1,908,287
CUC International, Inc. (b) 150,000 3,871,875
Casey's General Stores, Inc. 27,500 592,109
Central Garden & Pet Company (b) 337,700 8,442,500
Eagle Hardware & Garden, Inc. (b) 68,000 1,555,500
Goody's Family Clothing, Inc. (b) 44,400 1,215,450
The Hertz Corporation (b) 115,300 4,150,800
Just For Feet, Inc. (b) 125,000 2,179,687
MSC Industrial Direct Company, Inc. Class A (b) 35,600 1,428,450
Movie Gallery, Inc. (b) (g) 762,500 4,860,938
Regis Corporation 37,600 888,300
Renters Choice, Inc. (b) 160,000 3,180,000
Staples, Inc. (b) 124,200 2,887,650
U.S. Office Products Company (b) 33,900 1,036,069
Wilmar Industries, Inc. (b) 190,900 4,653,188
Zale Corporation (b) 186,800 3,700,975
-----------
46,551,778
SAVINGS & LOAN 2.1%
TCF Financial Corporation 163,350 8,065,406
26
See notes to financial statements.
<PAGE>
- --------------------------------------------------------------------------------
STRONG DISCOVERY FUND (continued)
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
- --------------------------------------------------------------------------------
TELECOMMUNICATION EQUIPMENT 1.2%
Aware, Inc. (b) 29,700 $ 438,075
Belden, Inc. 65,000 2,214,063
Communications Central, Inc. (b) 46,900 515,900
General Instrument Corporation (b) 25,700 642,500
Scientific-Atlanta, Inc. 34,800 761,250
------------
4,571,788
TOBACCO 0.7%
Philip Morris Companies, Inc. 62,300 2,764,562
TRANSPORTATION SERVICE 1.9%
Coach USA, Inc. (b) 175,400 4,659,062
Hub Group, Inc. Class A (b) 86,600 2,608,825
------------
7,267,887
------------
TOTAL COMMON STOCKS (COST $334,583,837) 362,014,590
CONVERTIBLE BONDS 0.2%
Halsey Drug Company, Inc. Subordinated
Debentures, 10.00%, Due 8/06/01 (Acquired
8/05/96; Cost $587,550) (d) (g)
(AMORTIZED COST $589,343) $ 600,000 768,480
SHORT-TERM INVESTMENTS (a) 3.7%
COMMERCIAL PAPER 0.2%
INTEREST BEARING, DUE UPON DEMAND
American Family Financial Services, Inc., 5.29% 328,900 328,900
Johnson Controls, Inc., 5.31% 300,700 300,700
Eli Lilly & Company, 5.09% 100 100
------------
629,700
REPURCHASE AGREEMENT 3.4%
Goldman, Sachs & Company (Dated 6/30/97),
5.75%, Due 07/01/97 (Repurchase proceeds
$13,202,108); Collateralized by: $10,345,000
United States Treasury Bonds, 13.375%,
Due 8/15/01 (Market Value $13,479,535) (f) 13,200,000 13,200,000
UNITED STATES GOVERNMENT ISSUES 0.1%
United States Treasury Bills, Due 9/25/97 (c) 500,000 493,992
------------
TOTAL SHORT-TERM INVESTMENTS
(COST $14,323,752) 14,323,692
------------
TOTAL INVESTMENTS IN SECURITIES
(COST $349,496,932) 97.8% 377,106,762
Other Assets and Liabilities, Net 2.2% 8,458,102
------------
NET ASSETS 100.0% $385,564,864
============
FUTURES
- -------
UNDERLYING
EXPIRATION FACE AMOUNT UNREALIZED
DATE AT VALUE DEPRECIATION
- --------------------------------------------------------------------------------
Purchased:
27 S&P 500 9/97 $12,018,375 ($35,338)
PERCENTAGE OF
COUNTRY DIVERSIFICATION NET ASSETS
- ----------------------------------------------------------------
United States ....................................... 92.3%
United Kingdom ...................................... 5.0
Canada .............................................. 0.5
Other Assets and Liabilities, Net ................... 2.2
------
Total 100.0%
======
- --------------------------------------------------------------------------------
STRONG SMALL CAP FUND
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
- --------------------------------------------------------------------------------
COMMON STOCKS 95.4%
AEROSPACE & DEFENSE 0.6%
BE Aerospace, Inc. (b) 31,500 $ 996,188
COMMERCIAL SERVICE 10.0%
Abacus Direct Corporation (b) 62,000 2,015,000
American Oncology Resources, Inc. (b) 122,300 2,063,813
CRA Managed Care, Inc. (b) 37,600 1,962,250
Computer Learning Centers, Inc. (b) 25,000 1,050,000
FPA Medical Management, Inc. (b) 38,700 916,706
Mail-Well, Inc. (b) 78,150 2,227,275
NCO Group, Inc. (b) 25,800 757,875
On Assignment, Inc. (b) 33,400 1,302,600
Pediatrix Medical Group (b) 63,200 2,895,350
Personnel Group of America, Inc. (b) 27,800 800,988
Staff Leasing, Inc. (b) 45,400 851,250
Universal Outdoor Holdings, Inc. (b) 24,500 854,437
-----------
17,697,544
COMPUTER - PERIPHERAL EQUIPMENT 2.1%
Encad, Inc. (b) 51,200 2,124,800
MicroTouch Systems, Inc. (b) 5,100 117,300
NeoMagic Corporation (b) 63,400 1,418,575
-----------
3,660,675
COMPUTER SERVICE 4.6%
CSG Systems International, Inc. (b) 70,400 2,173,600
Computer Horizons Corporation (b) 47,550 1,628,587
Computer Task Group, Inc. 58,400 2,175,400
Information Management Resources, Inc. (b) 48,300 2,197,650
-----------
8,175,237
COMPUTER SOFTWARE 14.4%
Aspect Development, Inc. (b) 31,700 826,181
Axent Technologies, Inc. (b) 18,200 277,550
Citrix Systems, Inc. (b) 44,100 1,934,888
CyberMedia, Inc. (b) 100,800 1,612,800
Great Plains Software, Inc. (b) 36,700 990,900
HNC Software, Inc. (b) 21,300 812,062
IDX Systems Corporation (b) 58,900 2,032,050
INSO Corporation (b) 12,900 265,256
Industri-Matematik International Corporation (b) 65,000 1,056,250
Larscom, Inc. Class A (b) 75,100 807,325
Manugistics Group, Inc. (b) 54,000 2,403,000
Radiant Systems, Inc. (b) 42,500 887,188
Sapient Corporation (b) 33,600 1,663,200
Saville Systems PLC Sponsored ADR (b) 33,000 1,716,000
Scopus Technology, Inc. (b) 65,200 1,458,850
Software Artistry, Inc. (b) 55,800 885,825
Transaction Systems Architects, Inc. (b) 24,200 834,900
Viasoft, Inc. (b) 33,500 1,700,125
Visio Corporation (b) 41,300 2,911,650
Zebra Technologies Corporation (b) 11,100 309,412
-----------
25,385,412
COMPUTER SYSTEMS 2.3%
Cognex Corporation (b) 66,800 1,770,200
HCIA, Inc. (b) 26,800 897,800
Imnet Systems, Inc. (b) 4,300 133,569
Wind River Systems, Inc. (b) 34,800 1,331,100
-----------
4,132,669
CONSUMER - MISCELLANEOUS 0.5%
800-JR CIGAR, Inc. (b) 39,500 819,625
COSMETIC & PERSONAL CARE 2.4%
NBTY, Inc. (b) 91,600 2,564,800
Rexall Sundown, Inc. (b) 43,100 1,680,900
-----------
4,245,700
ELECTRICAL EQUIPMENT 0.5%
Level One Communications, Inc. (b) 24,200 930,188
27
See notes to financial statements.
<PAGE>
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) June 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
STRONG SMALL CAP FUND (continued)
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
- --------------------------------------------------------------------------------
ELECTRONIC PRODUCTS - MISCELLANEOUS 1.4%
Electro Scientific Industries, Inc. (b) 22,600 $ 946,375
Harmonic Lightwaves, Inc. (b) 42,400 726,100
Powerwave Technologies, Inc. (b) 35,700 803,250
-----------
2,475,725
ELECTRONICS - SEMICONDUCTOR/COMPONENT 10.8%
Asyst Technologies, Inc. (b) 44,200 1,944,800
Credence Systems Corporation (b) 61,100 1,829,181
DuPont Photomasks, Inc. (b) 17,200 928,800
Electroglas, Inc. (b) 66,800 1,682,525
Fusion Systems Corporation (b) 24,100 953,456
Gasonics International Corporation (b) 68,500 933,312
Kulicke & Soffa Industries, Inc. (b) 29,000 941,594
PMC-Sierra, Inc. (b) 73,200 1,921,500
PRI Automation, Inc. (b) 37,900 1,437,831
Photronics, Inc. (b) 34,800 1,661,700
Triquint Semiconductor, Inc. (b) 30,700 1,055,313
Uniphase Corporation (b) 44,400 2,586,300
Veeco Instruments, Inc. (b) 32,200 1,247,750
-----------
19,124,062
HEALTHCARE - BIOMEDICAL/GENETIC 3.8%
Agouron Pharmaceuticals, Inc. (b) 22,200 1,795,425
Immunex Corporation (b) 53,100 1,924,875
Incyte Pharmaceuticals, Inc (b) 29,200 1,956,400
Vertex Pharmaceuticals, Inc. (b) 27,900 1,067,175
-----------
6,743,875
HEALTHCARE - INSTRUMENTATION 1.9%
Arterial Vascular Engineering, Inc. (b) 77,500 2,494,531
Spine-Tech, Inc. (b) 21,600 801,900
-----------
3,296,431
HEALTHCARE - MEDICAL SUPPLY 3.7%
Express Scripts, Inc. Class A (b) 37,700 1,573,975
Pharmaceutical Product Development, Inc. (b) 53,600 1,179,200
Steris Corporation (b) 45,200 1,689,350
TECNOL Medical Products, Inc. (b) 90,000 2,002,500
-----------
6,445,025
HEALTHCARE - PATIENT CARE 5.1%
Arbor Health Care Company (b) 43,900 1,360,900
Coventry Corporation (b) 110,600 1,672,825
Curative Health Services, Inc. (b) 61,400 1,765,250
Renal Treatment Centers, Inc. (b) 29,500 792,812
Total Renal Care Holdings, Inc. (b) 48,100 1,933,019
Trigon Heathcare, Inc. (b) 60,700 1,471,975
-----------
8,996,781
HEALTHCARE - PRODUCT 1.8%
Cytyc Corporation (b) 71,700 1,944,862
Hemocleanse, Inc. (Acquired 5/14/96;
Cost $465,000) (b) (d) 155,000 465,000
Perclose, Inc. (b) 33,700 842,500
-----------
3,252,362
HOUSING RELATED 0.9%
Advanced Lighting Technologies, Inc. (b) 66,200 1,671,550
INSURANCE - ACCIDENT & HEALTH 0.9%
Healthcare Recoveries, Inc. (b) 79,300 1,536,438
INSURANCE - PROPERTY & CASUALTY 2.3%
Amerin Corporation (b) 35,900 870,575
CMAC Investment Corporation 18,900 902,475
Frontier Insurance Group, Inc. 22,500 1,456,875
Vesta Insurance Group, Inc. 18,800 813,100
-----------
4,043,025
LEISURE SERVICE 1.0%
Steiner Leisure, Ltd. (b) 65,700 1,831,388
MACHINE TOOL 0.3%
JLK Direct Distribution, Inc. Class A (b) 17,500 448,438
MACHINERY - TRANSPORTATION EQUIPMENT
& PARTS 0.5%
Halter Marine Group, Inc. (b) 35,100 842,400
MORTGAGE & RELATED SERVICE 0.2%
Triad Guaranty, Inc. (b) 5,600 254,100
OIL WELL EQUIPMENT & SERVICE 1.7%
Cliffs Drilling Company (b) 50,600 1,846,900
Gulf Island Fabrication, Inc. (b) 44,700 1,145,437
-----------
2,992,337
POLLUTION CONTROL 1.3%
Newpark Resources, Inc. (b) 41,900 1,414,125
Waste Industries, Inc. (b) 53,300 939,412
-----------
2,353,537
REAL ESTATE 1.2%
Signature Resorts, Inc. (b) 58,000 2,004,625
RETAIL - DISCOUNT & VARIETY 0.8%
99 Cents Only Stores (b) 42,900 1,292,363
RETAIL - RESTAURANT 2.2%
Papa John's International, Inc. (b) 73,500 2,701,125
Showbiz Pizza Time, Inc. (b) 43,400 1,144,675
-----------
3,845,800
RETAIL - SPECIALTY 12.3%
Brylane, Inc. (b) 41,100 1,584,919
Coldwater Creek, Inc. (b) 5,600 145,600
Cole National Corporation Class A (b) 46,500 2,046,000
Corporate Express, Inc. (b) 119,500 1,725,281
Eagle Hardware & Garden, Inc. (b) 94,800 2,168,550
The Finish Line, Inc. Class A (b) 54,300 794,137
Goody's Family Clothing, Inc. (b) 67,900 1,858,763
Linens `N Things, Inc. (b) 68,200 2,020,425
MSC Industrial Direct Company, Inc. Class A (b) 41,300 1,657,163
The Men's Wearhouse, Inc. (b) 78,600 2,475,900
West Marine, Inc. (b) 53,700 1,382,775
The Wet Seal, Inc. Class A (b) 56,900 1,795,906
Williams-Sonoma, Inc. (b) 48,600 2,077,650
-----------
21,733,069
TELECOMMUNICATION EQUIPMENT 2.7%
Digital Microwave Corporation (b) 70,800 2,124,000
P-COM, Inc. (b) 24,900 821,700
REMEC, Inc. (b) 36,000 846,000
Spectrian Corporation (b) 28,000 1,032,500
-----------
4,824,200
TELECOMMUNICATION SERVICE 1.2%
STAR Telecommunications, Inc. (b) 80,700 1,069,275
World Access, Inc. (b) 53,100 1,088,550
-----------
2,157,825
-----------
TOTAL COMMON STOCKS (COST $144,890,091) 168,208,594
SHORT-TERM INVESTMENTS (a) 2.7%
COMMERCIAL PAPER 0.7%
INTEREST BEARING, DUE UPON DEMAND
American Family Financial Services, Inc., 5.29% $523,000 523,000
Johnson Controls, Inc., 5.31% 508,200 508,200
Eli Lilly & Company, 5.09% 100 100
Pitney Bowes Credit Corporation, 5.29% 225,800 225,800
Wisconsin Electric Power Company, 5.33% 43,000 43,000
-----------
1,300,100
28
See notes to financial statements.
<PAGE>
- --------------------------------------------------------------------------------
STRONG SMALL CAP FUND (continued)
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
- --------------------------------------------------------------------------------
REPURCHASE AGREEMENT 2.0%
Goldman, Sachs & Company (Dated 6/30/97),
5.75%, Due 7/01/97 (Repurchase proceeds
$3,500,559) Collateralized by: $2,455,000 United
States Treasury Bonds, 12.00%, Due 8/15/13,
(Market Value $3,574,480) (f) $3,500,000 $ 3,500,000
------------
TOTAL SHORT-TERM INVESTMENTS
(COST $4,800,100) 4,800,100
------------
TOTAL INVESTMENTS IN SECURITIES
(COST $149,690,191) 98.1% 173,008,694
Other Assets and Liabilities, Net 1.9% 3,368,029
------------
NET ASSETS 100.0% $176,376,723
============
PERCENTAGE OF
COUNTRY DIVERSIFICATION NET ASSETS
- ----------------------------------------------------------------
United States ....................................... 96.1%
United Kingdom ...................................... 1.0
Ireland ............................................. 1.0
Other Assets and Liabilities, Net ................... 1.9
------
Total 100.0%
======
LEGEND
- ------
(a) Short-term investments include any security which has a maturity of
less than one year.
(b) Non-income producing security.
(c) All or a portion of security pledged to cover margin requirements for
futures contracts.
(d) Restricted security.
(e) All or a portion of security is when-issued.
(f) The Funds may engage in repurchase agreements where the underlying
collateral consists of U.S. Government securities which are maintained in a
segregated account with a custodian. The market value of the collateral
must exceed the principal amount by at least two percent on a daily basis.
(g) Affiliated issuer (see Note 6 of Notes to Financial Statements.)
Percentages are stated as a percent of net assets.
CURRENCY ABBREVIATIONS
- ----------------------
CAD Canadian Dollar
CHF Swiss Franc
29
See notes to financial statements.
<PAGE>
<TABLE>
STATEMENTS OF ASSETS AND LIABILITIES
- ---------------------------------------------------------------------------------------------------------------------------------
June 30, 1997 (Unaudited)
(In Thousands, Except Per Share Amounts)
<CAPTION>
STRONG STRONG STRONG STRONG COMMON
VALUE FUND OPPORTUNITY FUND MID CAP FUND STOCK FUND
---------- ---------------- ------------ ----------
ASSETS:
<S> <C> <C> <C> <C>
Investments in Securities, at Value
Unaffiliated Issuers (Cost of $64,182, $1,439,569,
$11,961 and $1,138,956, respectively) $73,786 $1,761,085 $13,959 $1,414,226
Affiliated Issuers (Cost of $0, $0, $0 and $10,919,
respectively) -- -- -- 15,500
Receivable from Brokers for Securities Sold 69 17,981 526 4,978
Receivable for Fund Shares Sold 18 13 -- 10
Dividends and Interest Receivable 78 2,153 5 905
Other Assets 34 2,749 36 2,822
------- ---------- ------- ----------
Total Assets 73,985 1,783,981 14,526 1,438,441
LIABILITIES:
Payable to Brokers for Securities Purchased 363 17,091 41 10,606
Payable for Fund Shares Redeemed -- 56 -- 5
Accrued Operating Expenses and Other Liabilities 27 296 43 93
------- ---------- ------- ----------
Total Liabilities 390 17,443 84 10,704
------- ---------- ------- ----------
NET ASSETS $73,595 $1,766,538 $14,442 $1,427,737
======= ========== ======= ==========
NET ASSETS CONSIST OF:
Capital (par value and paid-in surplus) $63,116 $1,317,735 $14,559 $1,051,168
Undistributed Net Investment Income (Loss) -- 298 (28) 87
Undistributed Net Realized Gain (Loss) 875 127,026 (2,087) 96,071
Net Unrealized Appreciation 9,604 321,479 1,998 280,411
------- ---------- ------- ----------
Net Assets $73,595 $1,766,538 $14,442 $1,427,737
======= ========== ======= ==========
Capital Shares Outstanding (Unlimited Number Authorized) 5,696 46,673 1,430 62,895
NET ASSET VALUE PER SHARE $12.92 $37.85 $10.10 $22.70
====== ====== ====== ======
</TABLE>
<TABLE>
<CAPTION>
STRONG STRONG STRONG SMALL
GROWTH FUND DISCOVERY FUND CAP FUND
----------- -------------- --------
ASSETS:
Investments in Securities, at Value
Unaffiliated Issuers (Cost of $1,180,901, $344,404 and
<S> <C> <C> <C>
$149,690, respectively) $1,494,110 $367,500 $173,009
Affiliated Issuers (Cost of $7,480, $5,093 and $0, respectively) 10,200 9,607 --
Receivable from Brokers for Securities Sold 11,001 11,333 6,272
Receivable for Fund Shares Sold -- 1 10
Dividends and Interest Receivable 442 251 6
Other Assets 62 -- 47
---------- -------- --------
Total Assets 1,515,815 388,692 179,344
LIABILITIES:
Payable to Brokers for Securities Purchased 14,848 2,860 2,919
Payable for Fund Shares Redeemed 261 86 6
Accrued Operating Expenses and Other Liabilities 152 181 42
---------- -------- --------
Total Liabilities 15,261 3,127 2,967
---------- -------- --------
NET ASSETS $1,500,554 $385,565 $176,377
========== ======== ========
NET ASSETS CONSIST OF:
Capital (par value and paid-in surplus) $1,167,033 $364,905 $190,651
Undistributed Net Investment Loss (2,255) (1,738) (347)
Undistributed Net Realized Gain (Loss) 19,847 (5,173) (37,246)
Net Unrealized Appreciation 315,929 27,571 23,319
---------- -------- --------
Net Assets $1,500,554 $385,565 $176,377
========== ======== ========
Capital Shares Outstanding (Unlimited Number Authorized) 75,700 21,238 16,021
NET ASSET VALUE PER SHARE $19.82 $18.15 $11.01
====== ====== ======
See notes to financial statements.
</TABLE>
30
<PAGE>
<TABLE>
STATEMENTS OF OPERATIONS
- ----------------------------------------------------------------------------------------------------------------------------------
For the Six Months Ended June 30, 1997 (Unaudited)
<CAPTION>
(In Thousands)
STRONG
STRONG STRONG STRONG COMMON STRONG STRONG STRONG
VALUE OPPORTUNITY MID CAP STOCK GROWTH DISCOVERY SMALL CAP
FUND FUND FUND FUND FUND FUND FUND
------ ----------- ------- ------ ------ --------- ---------
INCOME:
<S> <C> <C> <C> <C> <C> <C> <C>
Dividends $ 484 $ 10,245 $ 21 $ 5,389 $ 4,207 $ 864 $ 96
Interest - Unaffiliated Issuers 234 3,836 40 3,099 2,153 179 252
Interest - Affiliated Issuers -- -- -- -- 538 -- --
------ -------- ------- -------- -------- ------- --------
Total Income 718 14,081 61 8,488 6,898 1,043 348
EXPENSES:
Investment Advisory Fees 312 8,421 62 6,413 6,873 1,949 795
Custodian Fees 4 83 8 50 38 38 17
Shareholder Servicing Costs 76 1,773 17 821 1,815 620 269
Reports to Shareholders 11 239 7 91 242 120 28
Federal and State Registration Fees 18 76 7 67 100 22 33
Other 7 71 2 64 84 32 10
------ -------- ------- -------- -------- ------- --------
Total Expenses 428 10,663 103 7,506 9,152 2,781 1,152
------ -------- ------- -------- -------- ------- --------
NET INVESTMENT INCOME (LOSS) 290 3,418 (42) 982 (2,254) (1,738) (804)
REALIZED AND UNREALIZED
GAIN (LOSS):
Net Realized Gain (Loss) on:
Investments in Unaffiliated Issuers 884 129,339 (2,067) 101,799 32,647 18,492 (24,220)
Investments in Affiliated Issuers -- -- -- (2,048) 1,530 (3,772) --
Futures and Forward Foreign
Currency Contracts -- -- -- (51) (418) (731) --
Foreign Currencies -- (1) -- (3) -- -- --
------ -------- ------- -------- -------- ------- --------
Net Realized Gain (Loss) 884 129,338 (2,067) 99,697 33,759 13,989 (24,220)
Change in Unrealized Appreciation/
Depreciation on:
Investments 6,582 23,308 1,998 83,907 99,491 489 11,189
Futures and Forward Foreign
Currency Contracts -- -- -- 586 -- (35) --
Foreign Currencies -- (28) -- (23) -- -- --
------ -------- ------- -------- -------- ------- --------
Net Change in Unrealized
Appreciation/Depreciation 6,582 23,280 1,998 84,470 99,491 454 11,189
------ -------- ------- -------- -------- ------- --------
NET GAIN (LOSS) 7,466 152,618 (69) 184,167 133,250 14,443 (13,031)
------ -------- ------- -------- -------- ------- --------
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM OPERATIONS $7,756 $156,036 ($ 111) $185,149 $130,996 $12,705 ($13,835)
====== ======== ======= ======== ======== ======= ========
See notes to financial statements.
</TABLE>
31
<PAGE>
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
- ---------------------------------------------------------------------------------------------------------------------------
<CAPTION>
(In Thousands)
STRONG VALUE FUND STRONG OPPORTUNITY FUND
-------------------------------- --------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1997 DEC. 31, 1996 JUNE 30, 1997 DEC. 31, 1996
---------------- ------------- ---------------- -------------
(UNAUDITED) (UNAUDITED)
OPERATIONS:
<S> <C> <C> <C> <C>
Net Investment Income $ 290 $ 457 $ 3,418 $ 8,761
Net Realized Gain 884 69 129,338 192,516
Change in Unrealized Appreciation/Depreciation 6,582 3,022 23,280 61,818
------- ------- ---------- ----------
Increase in Net Assets Resulting from Operations 7,756 3,548 156,036 263,095
DISTRIBUTIONS:
From Net Investment Income (291) (456) (2,826) (8,761)
In Excess of Net Investment Income -- -- -- (2,559)
From Net Realized Gains (78) -- (31,662) (173,793)
------- ------- ---------- ----------
Total Distributions (369) (456) (34,488) (185,113)
CAPITAL SHARE TRANSACTIONS:
Proceeds from Shares Sold 28,590 62,709 191,582 705,579
Proceeds from Reinvestment of Dividends 362 443 33,786 181,281
Payment for Shares Redeemed (18,239) (10,749) (349,948) (522,932)
------- ------- ---------- ----------
Increase (Decrease) in Net Assets from Capital
Share Transactions 10,713 52,403 (124,580) 363,928
------- ------- ---------- ----------
TOTAL INCREASE (DECREASE) IN NET ASSETS 18,100 55,495 (3,032) 441,910
NET ASSETS:
Beginning of Period 55,495 -- 1,769,570 1,327,660
------- ------- ---------- ----------
End of Period $73,595 $55,495 $1,766,538 $1,769,570
======= ======= ========== ==========
TRANSACTIONS IN SHARES OF THE FUND:
Sold 2,395 5,736 5,377 20,032
Issued in Reinvestment of Dividends 29 39 966 5,146
Redeemed (1,534) (969) (9,850) (14,803)
------ ----- ----- ------
Net Increase (Decrease) in Shares of the Fund 890 4,806 (3,507) 10,375
====== ===== ===== ======
</TABLE>
<TABLE>
<CAPTION>
STRONG MID CAP FUND STRONG COMMON STOCK FUND
------------------- --------------------------------
SIX MONTHS ENDED SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1997 JUNE 30, 1997 DEC. 31, 1996
---------------- ---------------- -------------
(UNAUDITED) (UNAUDITED)
OPERATIONS:
<S> <C> <C> <C>
Net Investment Income (Loss) ($ 42) $ 982 $ 3,234
Net Realized Gain (Loss) (2,067) 99,697 169,638
Change in Unrealized Appreciation/Depreciation 1,998 84,470 42,934
------- ---------- ----------
Increase (Decrease) in Net Assets Resulting from Operations (111) 185,149 215,806
DISTRIBUTIONS:
From Net Investment Income (6) (175) (3,234)
In Excess of Net Investment Income -- -- (3,023)
From Net Realized Gains -- (30,378) (182,428)
------- ---------- ----------
Total Distributions (6) (30,553) (188,685)
CAPITAL SHARE TRANSACTIONS:
Proceeds from Shares Sold 22,810 133,698 206,140
Proceeds from Reinvestment of Dividends 6 29,913 184,686
Payment for Shares Redeemed (8,257) (134,116) (235,311)
------- ---------- ----------
Increase in Net Assets from Capital Share Transactions 14,559 29,495 155,515
------- ---------- ----------
TOTAL INCREASE IN NET ASSETS 14,442 184,091 182,636
NET ASSETS:
Beginning of Period -- 1,243,646 1,061,010
------- ---------- ----------
End of Period $14,442 $1,427,737 $1,243,646
======= ========== ==========
TRANSACTIONS IN SHARES OF THE FUND:
Sold 2,275 6,423 9,957
Issued in Reinvestment of Dividends 1 1,484 9,121
Redeemed (846) (6,461) (11,308)
----- ----- ------
Net Increase in Shares of the Fund 1,430 1,446 7,770
===== ===== ======
See notes to financial statements.
</TABLE>
32
<PAGE>
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS (continued)
- ---------------------------------------------------------------------------------------------------------------------------
<CAPTION>
(In Thousands)
STRONG GROWTH FUND STRONG DISCOVERY FUND
-------------------------------- --------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1997 DEC. 31, 1996 JUNE 30, 1997 DEC. 31, 1996
---------------- ------------- ---------------- -------------
(UNAUDITED) (UNAUDITED)
OPERATIONS:
<S> <C> <C> <C> <C>
Net Investment Loss ($ 2,254) ($ 2,432) ($ 1,738) ($ 1,756)
Net Realized Gain 33,759 67,404 13,989 14,514
Change in Unrealized Appreciation/Depreciation 99,491 87,465 454 (7,519)
---------- ---------- -------- --------
Increase in Net Assets Resulting from Operations 130,996 152,437 12,705 5,239
DISTRIBUTIONS:
From Net Investment Income (92) -- -- --
In Excess of Net Investment Income -- (1,456) -- (35,615)
From Net Realized Gains (31,118) (31,662) -- (18,658)
---------- ---------- -------- --------
Total Distributions (31,210) (33,118) -- (54,273)
CAPITAL SHARE TRANSACTIONS:
Proceeds from Shares Sold 384,076 942,711 131,146 418,430
Proceeds from Reinvestment of Dividends 30,413 32,540 -- 53,029
Payment for Shares Redeemed (321,878) (429,235) (272,079) (507,692)
---------- ---------- -------- --------
Increase (Decrease) in Net Assets from Capital
Share Transactions 92,611 546,016 (140,933) (36,233)
---------- ---------- -------- --------
TOTAL INCREASE (DECREASE) IN NET ASSETS 192,397 665,335 (128,228) (85,267)
NET ASSETS:
Beginning of Period 1,308,157 642,822 513,793 599,060
---------- ---------- -------- --------
End of Period $1,500,554 $1,308,157 $385,565 $513,793
========== ========== ======== ========
TRANSACTIONS IN SHARES OF THE FUND:
Sold 20,764 52,717 7,687 23,944
Issued in Reinvestment of Dividends 1,725 1,753 -- 3,134
Redeemed (17,493) (24,245) (15,888) (29,235)
------ ------ ------ ------
Net Increase (Decrease) in shares of the Fund 4,996 30,225 (8,201) (2,157)
====== ====== ====== ======
</TABLE>
<TABLE>
<CAPTION>
STRONG SMALL CAP FUND
--------------------------------
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1997 DEC. 31, 1996
---------------- -------------
(UNAUDITED)
OPERATIONS:
<S> <C> <C>
Net Investment Loss ($ 804) ($ 476)
Net Realized Loss (24,220) (9,983)
Change in Unrealized Appreciation/Depreciation 11,189 12,129
-------- --------
Increase (Decrease) in Net Assets Resulting from Operations (13,835) 1,670
DISTRIBUTIONS:
From Net Investment Income (6) --
In Excess of Net Investment Income -- (2,103)
-------- --------
Total Distributions (6) (2,103)
CAPITAL SHARE TRANSACTIONS:
Proceeds from Shares Sold 129,507 234,309
Proceeds from Reinvestment of Dividends 6 2,045
Payment for Shares Redeemed (96,354) (78,862)
-------- --------
Increase in Net Assets from Capital Share Transactions 33,159 157,492
-------- --------
TOTAL INCREASE IN NET ASSETS 19,318 157,059
NET ASSETS:
Beginning of Period 157,059 --
-------- --------
End of Period $176,377 $157,059
======== ========
TRANSACTIONS IN SHARES OF THE FUND:
Sold 11,717 19,415
Issued in Reinvestment of Dividends 1 170
Redeemed (8,699) (6,583)
----- ------
Net Increase in Shares of the Fund 3,019 13,002
===== ======
See notes to financial statements.
</TABLE>
33
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
June 30, 1997 (Unaudited)
1. ORGANIZATION
The accompanying financial statements represent the Strong Growth Funds,
which include the following diversified, open-end management investment
companies registered under the Investment Company Act of 1940:
- Strong Value Fund (a series of Strong Equity Funds, Inc.) (Inception
date: December 29, 1995)
- Strong Opportunity Fund, Inc. (Inception date: December 31, 1985)
- Strong Mid Cap Fund (a series of Strong Equity Funds, Inc.) (Inception
date: December 31, 1996)
- Strong Common Stock Fund, Inc. (Inception date: December 29, 1989)
- Strong Growth Fund (a series of Strong Equity Funds, Inc.) (Inception
date: December 31, 1993)
- Strong Discovery Fund, Inc. (Inception date: December 31, 1987)
- Strong Small Cap Fund (a series of Strong Equity Funds, Inc.)
(Inception date: December 29, 1995)
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by
the Funds in the preparation of their financial statements.
(A) Security Valuation -- Portfolio securities traded primarily on a
principal securities exchange are valued at the last reported sales
price or the mean between the latest bid and asked prices where no
last sales price is available. Securities traded over-the-counter are
valued at the mean of the latest bid and asked prices or the last
reported sales price. Debt securities not traded on a principal
securities exchange are valued through valuations obtained from a
commercial pricing service, otherwise sale or bid prices are used.
Securities for which market quotations are not readily available, when
held by the Funds, are valued at fair value as determined in good
faith under consistently applied procedures established by and under
the general supervision of the Board of Directors. Securities which
are purchased within 60 days of their stated maturity are valued at
amortized cost, which approximates current value.
The Funds may own certain investment securities which are restricted
as to resale. These securities are valued after giving due
consideration to pertinent factors including recent private sales,
market conditions and the issuer's financial performance. The Funds
generally bear the costs, if any, associated with the disposition of
restricted securities. Aggregate cost and fair value of these
restricted securities held at June 30, 1997 were as follows:
AGGREGATE AGGREGATE PERCENT OF
COST FAIR VALUE NET ASSETS
---------- ---------- ----------
Strong Common Stock Fund $ 341,253 $ 359,445 0.0%
Strong Growth Fund 1,000,005 1,000,005 0.1%
Strong Discovery Fund 1,121,515 1,356,218 0.4%
Strong Small Cap Fund 465,000 465,000 0.3%
(B) Federal Income and Excise Taxes and Distributions to Shareholders --
It is the Funds' policy to comply with the requirements of the
Internal Revenue Code applicable to regulated investment companies and
to distribute substantially all of their taxable income to their
shareholders in a manner which results in no tax cost to the Funds.
Therefore, no federal income or excise tax provision is required.
The character of distributions made during the year from net
investment income or net realized gains may differ from the
characterization for federal income tax purposes due to differences in
the recognition of income and expense items for financial statement
and tax purposes. Where appropriate, reclassifications between net
asset accounts are made for such differences that are permanent in
nature.
(C) Realized Gains and Losses on Investment Transactions -- Gains or
losses realized on investment transactions are determined by comparing
the identified cost of the security lot sold with the net sales
proceeds.
(D) Futures -- Upon entering into a futures contract, the Funds pledge to
the broker cash or other investments equal to the minimum "initial
margin" requirements of the exchange. The Funds also receive from or
pay to the broker an amount of cash equal to the daily fluctuation in
the value of the contract. Such receipts or payments are known as
"variation margin," and are recorded as unrealized gains or losses.
When the futures contract is closed, a realized gain or loss is
recorded equal to the difference between the value of the contract at
the time it was opened and the value at the time it was closed.
(E) Options -- Premiums received by the Funds upon writing put or call
options are recorded as an asset with a corresponding liability which
is subsequently adjusted to the current market value of the option.
When an option expires, is exercised, or is closed, the Funds realize
a gain or loss, and the liability is eliminated. The Funds continue to
bear the risk of adverse movements in the price of the underlying
asset during the period of the option, although any potential loss
during the period would be reduced by the amount of the option premium
received.
34
<PAGE>
- --------------------------------------------------------------------------------
(F) Foreign Currency Translation -- Investment securities and other assets
and liabilities initially expressed in foreign currencies are
converted to U.S. dollars based upon current exchange rates. Purchases
and sales of foreign investment securities and income are converted to
U.S. dollars based upon currency exchange rates prevailing on the
respective dates of such transactions. The effect of changes in
foreign exchange rates on realized and unrealized security gains or
losses is reflected as a component of such gains or losses.
(G) Forward Foreign Currency Exchange Contracts -- Forward foreign
currency exchange contracts are valued at the forward rate and are
marked-to-market daily. The change in market value is recorded as an
unrealized gain or loss. When the contract is closed, the Funds record
an exchange gain or loss equal to the difference between the value of
the contract at the time it was opened and the value at the time it
was closed.
(H) Additional Investment Risk -- The use of futures contracts, options,
foreign denominated assets, forward foreign currency exchange
contracts and other similar investments for purposes of hedging the
Funds' investment portfolios involves, to varying degrees, elements of
market risk in excess of the amount recognized in the statement of
assets and liabilities. The predominant risk with futures contracts is
an imperfect correlation between the value of the contracts and the
underlying securities. Foreign denominated assets and forward foreign
currency exchange contracts may involve greater risks than domestic
transactions, including currency, political and economic, regulatory
and market risks.
(I) Use of Estimates -- The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements, and the
reported amounts of increases and decreases in net assets from
operations during the reporting period. Actual results could differ
from those estimates.
(J) Other -- Investment security transactions are recorded as of the trade
date. Dividend income and distributions to shareholders are recorded
on the ex-dividend date. Interest income is recorded on the accrual
basis and includes amortization of premium and discounts.
3. RELATED PARTY TRANSACTIONS
Strong Capital Management, Inc. (the "Advisor"), with whom certain officers
and directors of the Funds are affiliated, provides investment advisory
services and shareholder recordkeeping and related services to the Funds.
Investment advisory fees, which are established by terms of the Advisory
Agreements, are based on annualized rates of 1.00% of the average daily net
assets of the Funds. Advisory fees are subject to reimbursement by the
Advisor if the Funds' operating expenses exceed certain levels. Shareholder
recordkeeping and related service fees are based on contractually
established rates for each open and closed shareholder account. In
addition, the Advisor is compensated for certain other services related to
costs incurred for reports to shareholders.
The Funds may invest cash reserves in money market funds sponsored and
managed by Strong Capital Management, Inc., subject to certain limitations.
The terms of such transactions are identical to those of non-related
entitites except that, to avoid duplicate investment advisory fees, the
Advisor remits to each Fund an amount equal to all fees otherwise due to
them under their investment advisory agreement for the assets invested in
such money market funds.
Certain information regarding related party transactions for the six months
ended June 30, 1997, is as follows:
PAYABLE TO
(RECEIVABLE FROM) OTHER SHAREHOLDER UNAFFILIATED
ADVISOR AT SERVICING EXPENSES DIRECTORS'
JUNE 30, 1997 PAID TO ADVISOR FEES
----------------- ------------------ ------------
Strong Value Fund $20,595 $ 1,082 $ 750
Strong Opportunity Fund 98,826 18,544 10,746
Strong Mid Cap Fund 36,030 277 750
Strong Common Stock Fund (9,357) 11,531 7,781
Strong Growth Fund 60,117 24,216 8,138
Strong Discovery Fund 21,965 9,063 3,654
Strong Small Cap Fund 30,112 3,838 1,637
35
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued)
- --------------------------------------------------------------------------------
June 30, 1997 (Unaudited)
4. INVESTMENT TRANSACTIONS
The aggregate purchases and sales of long-term securities during the six
months ended June 30, 1997, were as follows:
PURCHASES SALES
-------------- --------------
Strong Value Fund $ 41,258,058 $ 31,096,776
Strong Opportunity Fund 858,810,564 993,466,136
Strong Mid Cap Fund 34,682,239 20,763,000
Strong Common Stock Fund 592,517,689 545,364,383
Strong Growth Fund 1,994,851,198 1,864,390,765
Strong Discovery Fund 356,130,598 484,764,002
Strong Small Cap Fund 493,054,867 456,499,765
5. INCOME TAX INFORMATION
The investment cost, gross unrealized appreciation and depreciation on
investments and capital loss carryovers (expiring in varying amounts
through 2004) for federal income tax purposes were as follows:
<TABLE>
<CAPTION>
AT JUNE 30, 1997 AT DECEMBER 31, 1996
------------------------------------------------------------------- --------------------
FEDERAL TAX UNREALIZED UNREALIZED NET NET CAPITAL LOSS
COST APPRECIATION DEPRECIATION APPRECIATION CARRYOVERS
----------- ------------ ------------ ------------ ----------------
<S> <C> <C> <C> <C> <C>
Strong Value Fund $ 64,231,453 $ 10,146,203 ($ 591,812) $ 9,554,391 --
Strong Opportunity Fund 1,441,437,974 360,697,647 (41,050,190) 319,647,457 --
Strong Mid Cap Fund 12,102,716 2,027,107 (170,401) 1,856,706 --
Strong Common Stock Fund 1,151,581,694 325,902,375 (47,757,762) 278,144,613 --
Strong Growth Fund 1,205,801,496 305,297,717 (6,789,683) 298,508,034 --
Strong Discovery Fund 351,253,450 49,950,992 (24,097,680) 25,853,312 $17,679,542
Strong Small Cap Fund 151,282,751 24,043,983 (2,318,040) 21,725,943 6,669,452
</TABLE>
6. INVESTMENTS IN AFFILIATES
Affiliated issuers, as defined under the Investment Company Act of 1940,
are those in which the Fund's holdings of an issuer represent 5% or more of
the outstanding voting securities of the issuer. A summary of transactions
in the securities of these issuers during the six months ended June 30,
1997 is as follows:
<TABLE>
<CAPTION>
DIVIDEND/INTEREST
BALANCE OF GROSS GROSS SALES BALANCE OF VALUE INCOME
SHARES HELD PURCHASES AND SHARES HELD JUNE 30, JAN. 1 - JUNE 30,
JAN. 1, 1997 AND ADDITIONS REDUCTIONS JUNE 30, 1997 1997 1997
------------ ------------- ---------- ------------- -------- -----------------
Strong Common Stock Fund
------------------------
<S> <C> <C> <C> <C> <C> <C>
IHOP Corporation 535,000 -- (35,000) 500,000 $15,500,000 --
Software Spectrum 274,000 11,000 (285,000) -- -- --
Strong Growth Fund
------------------
PJ America 256,500 -- (83,000) 173,500 2,949,500 --
Sipex Spectrum 400,000 40,500 (240,500) 200,000 7,250,000 --
Strong Institutional Money Fund 68,000,000 -- (68,000,000) -- -- $537,544
Strong Discovery Fund
---------------------
Foxmeyer Health Corporation 1,404,600 -- (1,404,600) -- -- --
Halsey Drug Company 1,000,095 64,830 (20,000) 1,044,925 4,746,109 --
Movie Gallery, Inc. 710,000 60,000 (7,500) 762,500 4,860,938 --
</TABLE>
36
<PAGE>
<TABLE>
FINANCIAL HIGHLIGHTS
- -------------------------------------------------------------------------------------------------------------------
STRONG VALUE FUND
- -------------------------------------------------------------------------------------------------------------------
<CAPTION>
SELECTED PER-SHARE DATA(a)
--------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
------------------------------------ -------------------------------------
Net Realized
Net Asset and Unrealized Total Net Asset
Value, Net Gains from From Net From Net Value,
Beginning Investment (Losses) on Investment Investment Realized Total End of
of Period Income Investments Operations Income Gains Distributions Period
<S> <C> <C> <C> <C> <C> <C> <C> <C>
June 30, 1997(b) $11.55 $0.05 $1.39 $1.44 ($0.05) ($0.02) ($0.07) $12.92
Dec. 31, 1996 10.00 0.13 1.55 1.68 (0.13) -- (0.13) 11.55
</TABLE>
STRONG VALUE FUND (Continued)
<TABLE>
<CAPTION>
RATIOS AND SUPPLEMENTAL DATA
------------------------------------------------------------------------
Net Ratio of Net
Assets, Ratio of Investment Average
End of Expenses Income Portfolio Commission
Total Period (In to Average to Average Turnover Rate
Return Millions) Net Assets Net Assets Rate Paid
<S> <C> <C> <C> <C> <C> <C>
June 30, 1997(b) +12.5% $74 1.4%* 0.9%* 57.1% $0.0500
Dec. 31, 1996 +16.8% 55 1.5% 1.5% 89.5% 0.0513
</TABLE>
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) For the six months ended June 30, 1997 (Unaudited). Total return and
portfolio turnover rate are not annualized.
<TABLE>
STRONG OPPORTUNITY FUND
- -------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
SELECTED PER-SHARE DATA(a)
-------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
----------------------------------------------- -------------------------------------------------
Net Realized
Net Asset and Unrealized Total In Excess Net Asset
Value, Net Gains from From Net of Net From Net Value,
Beginning Investment on Investment Investment Investment Realized Total End of
of Period Income Investments Operations Income Income Gains Distributions Period
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
June 30, 1997(c) $35.26 $0.07 $3.25 $3.32 ($0.06) -- ($0.67) ($0.73) $37.85
Dec. 31, 1996 33.35 0.20 5.78 5.98 (0.20) ($0.05) (3.82) (4.07) 35.26
Dec. 31, 1995 27.71 0.20 7.28 7.48 (0.20) (0.01) (1.63) (1.84) 33.35
Dec. 31, 1994 28.23 0.13 0.76 0.89 (0.13) -- (1.28) (1.41) 27.71
Dec. 31, 1993 24.70 0.06 5.10 5.16 (0.06) -- (1.57) (1.63) 28.23
Dec. 31, 1992 21.24 0.06 3.62 3.68 (0.06) -- (0.16) (0.22) 24.70
</TABLE>
<TABLE>
<CAPTION>
STRONG OPPORTUNITY FUND (Continued)
RATIOS AND SUPPLEMENTAL DATA
-------------------------------------------------------------------
Net Ratio of Net
Assets, Ratio of Investment Average
End of Expenses Income Portfolio Commission
Total Period (In to Average to Average Turnover Rate
Return Millions) Net Assets Net Assets Rate Paid(b)
<S> <C> <C> <C> <C> <C> <C>
June 30, 1997(c) +9.6% $1,767 1.3%* 0.4%* 54.8% $0.0542
Dec. 31, 1996 +18.1% 1,770 1.3% 0.6% 103.3% 0.0503
Dec. 31, 1995 +27.3% 1,328 1.3% 0.7% 92.5%
Dec. 31, 1994 +3.2% 806 1.4% 0.5% 59.2%
Dec. 31, 1993 +21.2% 444 1.4% 0.2% 109.1%
Dec. 31, 1992 +17.4% 193 1.5% 0.3% 138.5%
</TABLE>
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) Disclosure required, effective for reporting periods beginning after
September 1, 1995.
(c) For the six months ended June 30, 1997 (Unaudited). Total return and
portfolio turnover rate are not annualized.
<TABLE>
<CAPTION>
STRONG MID CAP FUND
- --------------------------------------------------------------------------------------------------------------------
SELECTED PER-SHARE DATA(a)
---------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
------------------------------------ -------------------------------------
Net Realized
Net Asset and Unrealized Total Net Asset
Value, Net Gains from From Net From Net Value,
Beginning Investment (Losses) on Investment Investment Realized Total End of
of Period Income Investments Operations Income Gains Distributions Period
<S> <C> <C> <C> <C> <C> <C> <C> <C>
June 30, 1997(b) $10.00 ($0.03) $0.13 $0.10 -- -- -- $10.10
</TABLE>
STRONG MID CAP FUND (Continued)
<TABLE>
<CAPTION>
RATIOS AND SUPPLEMENTAL DATA
------------------------------------------------------------------------
Net Ratio of Net
Assets, Ratio of Investment Average
End of Expenses Income Portfolio Commission
Total Period (In to Average to Average Turnover Rate
Return Millions) Net Assets Net Assets Rate Paid
<S> <C> <C> <C> <C> <C> <C>
June 30, 1997(b) +1.0% $14 1.6%* (0.7%)* 163.0% $0.0606
</TABLE>
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) For the six months ended June 30, 1997 (Unaudited). Total return and
portfolio turnover rate are not annualized.
37
<PAGE>
<TABLE>
FINANCIAL HIGHLIGHTS (continued)
- ---------------------------------------------------------------------------------------------------------------------------
STRONG COMMON STOCK FUND
- ---------------------------------------------------------------------------------------------------------------------------
<CAPTION>
SELECTED PER-SHARE DATA(a)
-------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
----------------------------------------------- -------------------------------------------------
Net Realized
Net Asset and Unrealized Total In Excess Net Asset
Value, Net Gains from From Net of Net From Net Value,
Beginning Investment on Investment Investment Investment Realized Total End of
of Period Income Investments Operations Income Income Gains Distributions Period
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
June 30, 1997(c) $20.24 $0.02 $2.94 $2.96 -- -- ($0.50) ($0.50) $22.70
Dec. 31, 1996 19.77 0.06 3.87 3.93 ($0.06) ($0.05) (3.35) (3.46) 20.24
Dec. 31, 1995 16.74 0.11 5.25 5.36 (0.10) (0.02) (2.21) (2.33) 19.77
Dec. 31, 1994 17.94 0.04 (0.13) (0.09) (0.04) -- (1.07) (1.11) 16.74
Dec. 31, 1993 15.07 0.04 3.74 3.78 (0.04) -- (0.87) (0.91) 17.94
Dec. 31, 1992 12.84 0.03 2.59 2.62 (0.01) -- (0.38)(d) (0.39) 15.07
</TABLE>
<TABLE>
<CAPTION>
STRONG COMMON STOCK FUND (Continued)
RATIOS AND SUPPLEMENTAL DATA
-------------------------------------------------------------------
Net Ratio of Net
Assets, Ratio of Investment Average
End of Expenses Income Portfolio Commission
Total Period (In to Average to Average Turnover Rate
Return Millions) Net Assets Net Assets Rate Paid(b)
<S> <C> <C> <C> <C> <C> <C>
June 30, 1997(c) +14.9% $1,428 1.2%* 0.2%* 45.6% $0.0542
Dec. 31, 1996 +20.5% 1,244 1.2% 0.3% 90.9% 0.0456
Dec. 31, 1995 +32.4% 1,061 1.2% 0.5% 91.5%
Dec. 31, 1994 -0.5% 790 1.3% 0.3% 83.0%
Dec. 31, 1993 +25.2% 762 1.4% 0.2% 80.9%
Dec. 31, 1992 +20.8% 179 1.4% 0.1% 291.7%
</TABLE>
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) Disclosure required, effective for reporting periods beginning after
September 1, 1995.
(c) For the six months ended June 30, 1997 (Unaudited). Total return and
portfolio turnover rate are not annualized.
(d) Includes $0.22 ordinary income distribution for tax purposes.
<TABLE>
STRONG GROWTH FUND
- -------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
SELECTED PER-SHARE DATA(a)
-------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
------------------------------------- -------------------------------------------------
Net Realized
Net Asset and Unrealized Total In Excess In Excess Net Asset
Value, Net Gains from of Net From Net of Net Value,
Beginning Investment on Investment Investment Realized Realized Total End of
of Period Income Investments Operations Income Gains Gains Distributions Period
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
June 30, 1997 (c) $18.50 ($0.03) $1.76 $1.73 -- ($0.41) -- ($0.41) $19.82
Dec. 31, 1996 15.88 (0.03) 3.13 3.10 ($0.02) (0.46) -- (0.48) 18.50
Dec. 31, 1995 11.61 (0.04) 4.79 4.75 (0.03) (0.16) (0.29) (0.48) 15.88
Dec. 31, 1994 10.00 -- 1.72 1.72 (0.11) -- -- (0.11) 11.61
</TABLE>
<TABLE>
<CAPTION>
STRONG GROWTH FUND (Continued)
RATIOS AND SUPPLEMENTAL DATA
-------------------------------------------------------------------
Net Ratio of Net
Assets, Ratio of Investment Average
End of Expenses Income Portfolio Commission
Total Period (In to Average to Average Turnover Rate
Return Millions) Net Assets Net Assets Rate Paid(b)
<S> <C> <C> <C> <C> <C> <C>
June 30, 1997 (c) +9.7% $1,501 1.3%* (0.3%)* 144.3% $0.0684
Dec. 31, 1996 +19.5% 1,308 1.3% (0.2%) 294.9% 0.0478
Dec. 31, 1995 +41.0% 643 1.4% (0.5%) 321.2%
Dec. 31, 1994 +17.3% 106 1.6% (0.1%) 385.8%
</TABLE>
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) Disclosure required, effective for reporting periods beginning after
September 1, 1995.
(c) For the six months ended June 30, 1997 (Unaudited). Total return and
portfolio turnover rate are not annualized.
<TABLE>
STRONG DISCOVERY FUND
- ---------------------------------------------------------------------------------------------------------------------------
<CAPTION>
SELECTED PER-SHARE DATA(a)
-------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
------------------------------------ -------------------------------------------------
Net Realized
Net Asset and Unrealized Total In Excess Net Asset
Value, Net Gains from From Net of Net From Net Value,
Beginning Investment on Investment Investment Investment Realized Total End of
of Period Income Investments Operations Income Income Gains Distributions Period
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
June 30, 1997(c) $17.45 ($0.08) $0.78 $0.70 -- -- -- -- $18.15
Dec. 31, 1996 18.96 (0.15) 0.35 0.20 -- ($1.12) (0.59) ($1.71) 17.45
Dec. 31, 1995 15.67 (0.05) 5.48 5.43 -- (0.10) (2.04) (2.14) 18.96
Dec. 31, 1994 18.05 0.16 (1.17) (1.01) ($0.11) (0.58) (0.68) (1.37) 15.67
Dec. 31, 1993 16.01 (0.01) 3.48 3.47 -- (0.45) (0.98) (1.43) 18.05
Dec. 31, 1992 17.49 (0.06) 0.23 0.17 -- -- (1.65)(d) (1.65) 16.01
</TABLE>
STRONG DISCOVERY FUND (Continued)
<TABLE>
<CAPTION>
RATIOS AND SUPPLEMENTAL DATA
-------------------------------------------------------------------
Net Ratio of Net
Assets, Ratio of Investment Average
End of Expenses Income Portfolio Commission
Total Period (In to Average to Average Turnover Rate
Return Millions) Net Assets Net Assets Rate Paid(b)
<S> <C> <C> <C> <C> <C> <C>
June 30, 1997(c) +4.0% $386 1.4%* (0.9%)* 91.7% $0.0590
Dec. 31, 1996 +1.5% 514 1.4% (0.3%) 792.8% 0.0339
Dec. 31, 1995 +34.8% 599 1.4% (0.4%) 516.0%
Dec. 31, 1994 -5.7% 388 1.5% 0.7% 606.1%
Dec. 31, 1993 +22.2% 302 1.5% (0.2%) 668.2%
Dec. 31, 1992 +1.9% 193 1.5% (0.4%) 1,258.6%
</TABLE>
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) Disclosure required, effective for reporting periods beginning after
September 1, 1995.
(c) For the six months ended June 30, 1997 (Unaudited). Total return and
portfolio turnover rate are not annualized.
(d) Includes $1.50 ordinary income distribution for tax purposes.
38
<PAGE>
<TABLE>
<CAPTION>
STRONG SMALL CAP FUND
- --------------------------------------------------------------------------------------------------------
SELECTED PER-SHARE DATA(a)
---------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
------------------------------------ --------------------------
Net Realized
Net Asset and Unrealized Total In Excess Net Asset
Value, Net Gains from of Net Value,
Beginning Investment (Losses) on Investment Investment Total End of
of Period Loss Investments Operations Income Distributions Period
<S> <C> <C> <C> <C> <C> <C> <C>
June 30, 1997(b) $12.08 ($0.05) ($1.02) ($1.07) -- -- $11.01
Dec. 31, 1996 10.00 (0.01) 2.28 2.27 ($0.19) ($0.19) 12.08
</TABLE>
<TABLE>
RATIOS AND SUPPLEMENTAL DATA
---------------------------------------------------------------------
Net Ratio of Net
Assets, Ratio of Investment Average
End of Expenses Income Portfolio Commission
Total Period (In to Average to Average Turnover Rate
Return Millions) Net Assets Net Assets Rate Paid
<S> <C> <C> <C> <C> <C> <C>
June 30, 1997(b) -8.9% $176 1.4%* (1.0%)* 301.3% $0.0546
Dec. 31, 1996 +22.7% 157 1.5% (0.7%) 419.8% 0.0372
</TABLE>
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) For the six months ended June 30, 1997 (Unaudited). Total return and
portfolio turnover rate are not annualized.
39
<PAGE>
NOTES
- --------------------------------------------------------------------------------
40
<PAGE>
DIRECTORS
Richard S. Strong
John Dragisic
Willie D. Davis
Stanley Kritzik
Marvin E. Nevins
William F. Vogt
OFFICERS
Richard S. Strong, Chairman of the Board
John Dragisic, President
Lawrence A. Totsky, Vice President
Thomas P. Lemke, Vice President
John S. Weitzer, Vice President
Stephen J. Shenkenberg, Vice President and Secretary
John A. Flanagan, Treasurer
INVESTMENT ADVISOR
Strong Capital Management, Inc.
P.O. Box 2936, Milwaukee, Wisconsin 53201
CUSTODIAN
Firstar Trust Company
P.O. Box 701, Milwaukee, Wisconsin 53201
AUDITOR
Coopers & Lybrand L.L.P.
411 East Wisconsin Avenue, Milwaukee, Wisconsin 53202
LEGAL COUNSEL
Godfrey & Kahn, S.C.
780 North Water Street, Milwaukee, Wisconsin 53202
<PAGE>
For a prospectus containing more complete information, including management fees
and expenses, please call 1-800-368-1030. Please read it carefully before
investing or sending money. This report does not constitute an offer for the
sale of securities. Strong Funds are offered for sale by prospectus only.
[PICTURE OF TELEPHONE]
To order a free prospectus kit,
CALL 1-800-368-1030.
To learn more about our funds,
discuss an existing account,
or conduct a transaction,
CALL 1-800-368-3863.
--------------------
If you are a
Financial Professional,
CALL 1-800-368-1683
[PICTURE OF STRONG WEB SITE ON COMPUTER]
Strong On-line
www.strong-funds.com
[STRONG LOGO]
STRONG FUNDS
P.O. Box 2936 o Milwaukee, Wisconsin 53201
Strong Funds Distributors, Inc. 5496G97 97SGRO
