<PAGE> 1
ANNUAL REPORT / JULY 31 2000
AIM ADVISOR INTERNATIONAL VALUE FUND
[COVER IMAGE]
[AIM LOGO APPEARS HERE]
--Registered Trademark--
<PAGE> 2
[ COVER IMAGE ]
------------------------------------
TRADER GEORG (GISZE) BY HANS HOLBEIN THE YOUNGER
THIS PAINTING DEPICTS A GERMAN MERCHANT IN LONDON, PRESUMABLY ON SOME KIND
OF BUSINESS VENTURE. THE VARIOUS ITEMS SURROUNDING HIM--LEDGERS AND LISTS,
FOREIGN COINS, ORNAMENTAL AND EXOTIC-LOOKING OBJECTS--CALL TO MIND HIS TRAVELS
IN SUPPORT OF HIS PROFESSION. TRADERS SUCH AS GEORG FORMED THE BASIS OF THE
GLOBAL MARKETPLACE AS WE KNOW IT, ALLOWING COMPANIES SUCH AS THOSE IN WHICH
THIS FUND INVESTS TO BE OPEN TO THE TRADERS OF TODAY.
------------------------------------
AIM Advisor International Value Fund is for shareholders who seek a high total
return through capital appreciation and current income through a diversified
portfolio of foreign equity securities.
ABOUT FUND PERFORMANCE AND PORTFOLIO DATA THROUGHOUT THIS REPORT:
o AIM Advisor International Value Fund's performance figures are historical,
and they reflect the reinvestment of distributions and changes in net asset
value.
o When sales charges are included in performance figures, Class A share
performance reflects the maximum 5.50% sales charge, and Class B and Class C
share performance reflects the applicable contingent deferred sales charge
(CDSC) for the period involved. The CDSC on Class B shares declines from 5%
beginning at the time of purchase to 0% at the beginning of the seventh
year. The CDSC on Class C shares is 1% for the first year after purchase.
The performance of the fund's Class B and Class C shares will differ from
that of its Class A shares due to different sales-charge structure and class
expenses.
o The fund's average annual total returns, including sales charges, for the
periods ended 6/30/00, the most recent calendar quarter end, were as
follows. Class A shares, one year, 9.75%; inception (12/31/96), 10.69%.
Class B shares, one year, 10.30%; inception (3/3/98), 6.95%. Class C shares,
one year, 14.24%; five years, 14.15%; inception (5/1/95), 14.14%.
o Since our last report to you, the fund's fiscal year end was changed from
December 31 to July 31. Certain information in the financial pages of this
report and information concerning fund distributions, if any, are for the
period 12/31/99-7/31/00. The portfolio managers' discussion and the
performance information presented are for the period 7/31/99-7/31/00.
o The fund's cumulative total returns at net asset value for the seven-month
period ended 7/31/00 were as follows: Class A shares, -5.72%; Class B
shares, -6.16%; Class C shares, -6.16%.
o International investing presents certain risks not associated with
investing solely in the United States. These include risks relating to
fluctuations in the value of the U.S. dollar relative to the values of other
currencies, the custody arrangements made for the fund's foreign holdings,
differences in accounting, political risks and the lesser degree of public
information required to be provided by non-U.S. companies.
o The fund's investment return and principal value will fluctuate, so an
investor's shares, when redeemed, may be worth more or less than their
original cost.
ABOUT INDEXES AND OTHER PERFORMANCE BENCHMARKS CITED IN THIS REPORT:
o The unmanaged Lipper International Fund Index represents an average of the
performance of the 30 largest international funds tracked by Lipper, Inc.,
an independent mutual fund performance monitor.
o The unmanaged MSCI EAFE--Registered Trademark--(Europe, Australasia and the
Far East) Index is a group of foreign securities tracked by Morgan Stanley
Capital International.
o The unmanaged National Association of Securities Dealers Automated
Quotation System Composite Index (the Nasdaq) is a market-value-weighted
index comprising all domestic and non-U.S.-based common stocks listed on the
Nasdaq system. It includes more than 5,000 companies, and it is often
considered representative of the small and medium-sized company stock
universe. While it includes many small and mid-sized company stocks,
large-capitalization technology companies tend to dominate the index.
o An investment cannot be made in an index. Unless otherwise indicated, index
results include reinvested dividends, and they do not reflect sales charges.
AN INVESTMENT IN THE FUND IS NOT A DEPOSIT OF A BANK AND IS NOT INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER
GOVERNMENT AGENCY. THERE IS A RISK THAT YOU COULD LOSE SOME OR ALL OF
YOUR MONEY.
This report may be distributed only to current shareholders or to persons
who have received a current prospectus of the fund.
AIM ADVISOR INTERNATIONAL VALUE FUND
<PAGE> 3
ANNUAL REPORT / CHAIRMAN'S LETTER
Dear Fellow Shareholder:
[PHOTO OF When we started AIM in 1976, we had only a table, two chairs
Charles T. and a telephone. At the time, Bob Graham, Gary Crum and I
Bauer had the idea of creating a mutual fund company that put
Chairman of people first. Our slogan, "people are the product," means
the Board of that people--our employees and our investors--are our
THE FUND company.
APPEARS HERE] Almost a quarter-century later, we've grown to more than
eight million investors, with $176 billion in assets under
[PHOTO OF management. Over that time, the industry as a whole has
Robert H. grown from $51 billion in assets to more than $7 trillion
Graham today. I never dreamed we would see such phenomenal growth.
APPEARS HERE] You are the main reason for our success, and I want you to
know how much I appreciate your loyalty and trust over the
past 24 years.
Usually in this letter I review market activity during
the period covered by the report. This time, I'd just like
to say thank you. I am retiring as chairman of the AIM Funds effective September
30, and as chairman of AIM effective December 31, 2000. Bob Graham, whose
picture appears under mine, will succeed me as AIM's chairman and chairman of
the AIM Funds. Gary Crum will remain president of A I M Capital Management,
Inc., leading our investment division. I am enormously proud to leave AIM in
such capable hands.
I'm also very proud of our team of employees, now more than 2,500 strong.
Because of their collective commitment to excellence and ethical business
practices, AIM has earned the trust of investors and financial advisors alike.
And every employee, from portfolio managers to client services representatives,
is dedicated to serving our shareholders.
Rest assured that nothing at AIM will change because of my retirement. You
can still depend on this company to manage your money responsibly and provide
you with top-notch service. As chairman of AIM and chairman of the AIM Funds,
Bob is committed to preserving the things that have made AIM great in the past
and positioning it to succeed in the future. And Gary is dedicated to
maintaining the quality and long-term performance you've come to expect from
AIM.
In the pages that follow, the managers of your fund comment on recent market
activity, how they have managed your fund over the past year and their outlook
for the coming months. We trust you will find their comments helpful.
If you have any questions or comments, please contact us through our Web
site, www.aimfunds.com, or call our Client Services department at 800-959-4246
during normal business hours. Information about your account is available at our
Web site and on our automated AIM Investor Line, 800-246-5463.
Thank you again for the support and trust you've shown us. I feel privileged
to have helped you with your financial goals, and I wish you success in all your
endeavors.
Sincerely,
/s/ CHARLES T. BAUER
Charles T. Bauer
Chairman, A I M Advisors, Inc.
AIM ADVISOR INTERNATIONAL VALUE FUND
<PAGE> 4
ANNUAL REPORT / MANAGERS' OVERVIEW
FUND POSTS DOUBLE-DIGIT RETURNS DESPITE VOLATILE INTERNATIONAL MARKETS
FOREIGN MARKETS RALLIED, THEN DECLINED DURING THE FISCAL YEAR. HOW DID THE FUND
PERFORM?
A shift in investor sentiment toward value stocks aided the fund's performance
for the fiscal year ended July 31, 2000. Excluding sales charges, the fund
registered one-year total returns of 12.34%, 11.50% and 11.44% for Class A,
Class B and Class C shares, respectively. The fund outperformed the
EAFE--Registered Trademark-- Index, which had a total return of 9.01% for the
fiscal year.
WHAT WERE SOME OF THE MAJOR TRENDS IN INTERNATIONAL STOCK MARKETS DURING THE
REPORTING PERIOD?
After strong performance in 1999, international markets were volatile in 2000.
High-flying technology stocks boosted stock markets worldwide during the last
half of 1999 and the initial months of 2000. However, in March, investors became
concerned that tech stocks might be overvalued, causing a sell-off that
eventually affected other market sectors. In the United States, the Federal
Reserve Board (the Fed) continued raising short-term interest rates, a trend
that periodically jolted markets globally.
For much of the fiscal year, growth stocks outperformed value stocks. But
toward the end of the reporting period, investors shifted their focus to value
stocks as they became concerned that certain growth stocks, particularly
technology issues, might be overpriced.
HOW DID EUROPEAN MARKETS FARE?
Boosted by technology, media and telecommunications stocks (TMTs), European
markets soared in late 1999 and early 2000. European markets continued their
upward climb until March, when the tech-laden Nasdaq faltered in the United
States. The Nasdaq's woes had repercussions worldwide, including in Europe,
where stock markets endured one their most volatile periods ever during the
spring and early summer. As technology stocks plummeted, old-economy stocks came
back into favor.
Despite market volatility, the economic and business climate in Europe
continued to bode well for stocks:
o Earnings were strong for many European companies and were forecasted to
grow by 24% in 2000, according to Morgan Stanley.
o European merger-and-acquisition activity continued at a brisk pace.
Through the first half of 2000, 40% of all global deals announced
involved a European company as an acquirer.
o The European equity culture continued to expand as initial public
offerings outpaced those of the United States. Europe's stock exchanges
also gained strength.
HOW DID JAPAN AND THE REST OF ASIA PERFORM?
The Japanese stock market, one of the best performers in 1999, fell
precipitously in 2000. TMTs, which had been largely responsible for the Japanese
market's dramatic gains, contributed significantly to its decline. Investors
also were concerned about Japan's economy, which experienced two quarters of
declining growth--technically a recession--in the second half of 1999. While the
economy grew 2.4% in the first quarter of 2000, this figure was below the
estimates of many analysts.
As for the rest of Asia, markets mirrored the choppy performance of the
United States because of their heavy weightings in technology stocks. However,
economic conditions in Asia appeared favorable for stocks. In the region, most
economies were expanding, corporate earnings estimates were impressive,
inflation was low and currencies were stable.
HOW WAS THE FUND STRUCTURED AT THE END OF THE FISCAL YEAR?
As of July 31, 2000, the fund had 61 holdings, with large-cap stocks making up
most of the portfolio. We seek to own the favorably priced stocks of companies
with established track records. This strategy has resulted in the fund investing
primarily in the stocks of large, multi-national companies.
More than 60% of the fund's total net assets was invested in European stocks
while approximately 25% was invested in Asian stocks. At the end of the
reporting period, Japan and the United Kingdom were the top country allocations.
Our top sectors at the end of the reporting period included
------------------------------------
DESPITE MARKET VOLATILITY,
THE ECONOMIC AND BUSINESS CLIMATE
IN EUROPE CONTINUED TO
BODE WELL FOR STOCKS.
------------------------------------
[IMAGE]
ONE-YEAR TOTAL RETURNS
As of 7/31/00, excluding sales charges
================================================================================
CLASS A SHARES 12.34%
CLASS B SHARES 11.50%
CLASS C SHARES 11.44%
MSCI EAFE--Registered Trademark-- INDEX 9.01%
================================================================================
See important fund and index disclosures inside front cover.
AIM ADVISOR INTERNATIONAL VALUE FUND
2
<PAGE> 5
ANNUAL REPORT / MANAGERS' OVERVIEW
financials, 20.6%; communications services, 10.8%; and capital goods, 9.9%.
During the second half of the fiscal year, we significantly reduced the fund's
exposure to the volatile technology sector.
WHAT WERE SOME OF THE FUND'S TOP STOCK HOLDINGS?
o HSBC Holdings, the United Kingdom's largest bank, was the fund's top
holding at the end of the fiscal year. The firm has more than 5,000
offices, providing a variety of banking services in nearly 80
countries, including the United States.
o Societe Generale, a French bank and the fund's second-largest holding,
is seeking to expand its global reach. In addition to 2,500 branches in
France, the company has another 650 offices in other countries. It
recently bought a fund-management unit of Japan's failed Yamaichi
Securities.
o Philips Electronics of the Netherlands is the world's third-largest
consumer electronics maker. The company produces televisions, VCRs,
compact-disc players and other electronic devices.
o Canon, a Japanese computer-hardware firm, makes copiers, camcorders,
fax machines and other items. Approximately 70% of the company's sales
are to customers outside Japan, chiefly in North and South America.
o ING Groep of the Netherlands is one of the world's largest financial-
services firms. The company offers insurance, banking and diversified
financial services.
o French oil company Total Fina Elf operates 29 refineries and
approximately 20,000 service stations, primarily in Europe and Africa.
o Nestle of Switzerland is the world's largest food company. Although
perhaps best known for its chocolate, the company also markets coffee,
bottled water, pet food and other products.
WHAT IS YOUR NEAR-TERM OUTLOOK?
We expect markets to remain volatile. In recent months, global markets have
tended to take their cue from developments in the United States, particularly
from the Fed's actions and from the performance of the Nasdaq. While it appears
that the Fed may be winding down its interest-rate-raising cycle, this is by no
means a certainty. The possibility of additional Fed rate hikes and continued
Nasdaq volatility could spill over into foreign markets and cause them to
fluctuate, sometimes dramatically.
Nevertheless, the global economic climate appears favorable for stocks,
particularly in Europe and in Asia, where the fund has been heavily invested. We
believe this bodes well for the fund.
--------------------------------------------------------------------------------
[PHOTO]
NEW FISCAL YEAR-END
Since our last report to you, AIM Advisor International Value Fund's fiscal
year-end was changed from December 31 to July 31. Going forward, you will
receive an annual report dated July 31 and a semiannual report dated January 31
each year.
================================================================================
PORTFOLIO COMPOSITION
As of 7/31/00, based on total net assets
<TABLE>
<CAPTION>
==========================================================================================================================
TOP 10 HOLDINGS TOP 10 INDUSTRIES TOP 10 COUNTRIES
--------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1. HSBC Holdings PLC-ADR (United Kingdom) 3.88% 1. Banks (Major Regional) 10.37% 1. Japan 23.05%
2. Societe Generale (France) 2.98 2. Telephone 8.88 2. United Kingdom 21.08
3. Korinklijke (Royal) Philips 3. Health Care (Drugs--Major 3. Netherlands 10.61
Electronics N.V.-ADR (Netherlands) 2.87 Pharmaceuticals) 8.24
4. Canon Inc.-ADR (Japan) 2.73 4. Oil (International Integrated) 7.30 4. Germany 8.05
5. ING Groep N.V.-ADR (Netherlands) 2.69 5. Electrical Equipment 6.63 5. France 7.23
6. Total Fina Elf S.A.-ADR (France) 2.58 6. Electric Companies 4.80 6. Switzerland 5.95
7. Nestle S.A.-ADR (Switzerland) 2.50 7. Chemicals (Diversified) 4.35 7. Italy 5.27
8. Kyocera Corp.-ADR (Japan) 2.33 8. Foods 4.29 8. Spain 4.61
9. National Australia Bank Ltd.-ADR 9. Banks (Money Center) 3.88 9. Australia 4.13
(Australia) 2.30
10. Portugal Telecom S.A.-ADR (Portugal) 2.29 10. Automobiles 3.66 10. Portugal 2.29
The fund's portfolio is subject to change, and there is no assurance that the
fund will continue to hold any particular security.
==========================================================================================================================
</TABLE>
See important fund and index disclosures inside front cover.
AIM ADVISOR INTERNATIONAL VALUE FUND
3
<PAGE> 6
ANNUAL REPORT / PERFORMANCE HISTORY
YOUR FUND'S LONG-TERM PERFORMANCE
RESULTS OF A $10,000 INVESTMENT
AIM ADVISOR INTERNATIONAL VALUE FUND
VS. BENCH MARK INDEXES
5/1/95-7/31/00
in thousands
================================================================================
MSCI EAFE
AIM Advisor International Lipper International --Registered Trademark--
Value Fund, Class C Shares Fund Index Index
--------------------------------------------------------------------------------
5/1/95 10,000 10,000 10,000
7/31/95 10,215 10,694 10,311
7/31/96 12,069 11,576 10,698
7/31/97 15,428 13,589 11,667
7/31/98 17,390 13,445 11,651
7/31/99 17,177 16,574 14,642
7/31/00 19,242 19,165 15,903
Source: Lipper, Inc.
Past performance cannot guarantee comparable future results.
================================================================================
Market volatility can significantly impact short-term performance. Results
of an investment made today may differ substantially from the historical
performance shown.
================================================================================
ABOUT THIS CHART
The chart compares your fund's Class C shares to benchmark indexes. It is
intended to give you a general idea of how your fund performed compared to these
indexes over the period 5/1/95-7/31/00. (Data for the indexes are for the period
4/30/95-7/31/00.) It is important to understand the differences between your
fund and an index. An index measures the performance of a hypothetical
portfolio. A market index such as the EAFE--Registered Trademark-- is not
managed, incurring no sales charges, expenses or fees. An index of funds such as
the Lipper International Fund Index includes a number of mutual funds grouped by
investment objective. Each of those funds interprets that objective differently,
and each employs a different management style and investment strategy. If you
could buy all the securities that make up a market index, you would incur
expenses that would affect your investment's return.
================================================================================
AVERAGE ANNUAL TOTAL RETURNS
As of 7/31/00, including sales charges
================================================================================
CLASS A SHARES
Inception (12/31/96) 9.46%
1 year 6.17*
* 12.34%, excluding sales charges
CLASS B SHARES
Inception (3/03/98) 5.24%
1 year 6.50*
* 11.50%, excluding CDSC
CLASS C SHARES
Inception (5/1/95) 13.19%
5 years 12.53
1 year 10.44*
* 11.44%, excluding CDSC
================================================================================
Your fund's total return includes sales charges, expenses and management fees.
The performance of the fund's Class A and Class B shares will differ from that
of its Class C shares due to differing fees and expenses. For fund performance
calculations and descriptions of the indexes cited on this page, please see the
inside front cover.
================================================================================
AIM ADVISOR INTERNATIONAL VALUE FUND
4
<PAGE> 7
ANNUAL REPORT / FOR CONSIDERATION
CHASING PERFORMANCE MAY HURT MORE THAN IT HELPS
In the wake of some of last year's eye-popping mutual fund returns of more than
100%, it may be hard to look at your own returns and not feel disappointed.
According to Lipper, Inc.(1), the average large-cap core mutual fund finished
1999 up 22.35%--a return that would be considered terrific in most other
years--while the average science and technology fund had an astounding return of
134.77% for the year. Industry trends point to the fact that some investors have
looked at such performance and said, "My investments haven't had that kind of
return. I need to change my portfolio." What's an investor to do?
LOOK AT THE BIG PICTURE
It's very tempting to look only at returns when you invest in a mutual fund. But
there are other factors to consider:
o How well does the fund match my financial goals?
Different kinds of mutual funds are appropriate for different people at
different stages. Are you a young adult early in your work life, or are you
approaching retirement? Are you investing to buy a house, car or other large
item soon, or are you investing for your later years?
If your investment plan has a rather long time horizon, you may be able to
invest more aggressively because you could have time to recoup should you
experience losses. If your needs are more immediate, you should assess how
aggressive you can afford to be--you may need to be more conservative than you
thought to meet your goal.
o How well does the fund match my tolerance for risk?
Many of the mutual funds that had such high-flying returns for 1999 are pretty
aggressive, investing in smaller, less- established companies, some of which
have not even realized a profit. So while these mutual funds have the potential
to make your money grow, they may also entail more risk than you may be prepared
to take.
Of course, investing in any mutual fund brings with it a certain amount of
risk, but this risk can vary widely depending on the types of holdings in which
a fund invests. It's important that you take a hard look at your risk tolerance
before investing in any fund, particularly if you are ratcheting up to a more
aggressive fund.
o How well does the fund fit into my portfolio?
When a market sector or mutual fund is doing well, you may be tempted to
overload your portfolio with the "winner of the moment." It seems to make
sense--you're making money with that investment, so you should allocate more
money to it, right?
Be careful. A narrowly invested portfolio could be especially vulnerable to
market volatility. Spreading your investment over several types of funds or
investing in one diversified fund can help you spread out your risk--the more
diversified your portfolio, the less overlap it should have. Less overlap can
mean less risk.
PAST PERFORMANCE IS NO GUARANTEE
Last year's phenomenal returns were the result of a number of unique factors--
the strong U.S. economy, the proliferation of new technology companies and
record amounts of cash being poured into the stock market, to name a few. Even
so, it may seem that everyone came out a winner in 1999.
In reality, just a few large companies accounted for many of the markets'
records in 1999. More than half the stocks in the S&P 500(2) declined during the
year. The technology sector was clearly dominant--the tech component of the S&P
500 finished 1999 with a return of 75.11%, while the capital-goods component of
the index, which came in second for the year, had a return of 28.76%.(3) So if
you didn't invest in technology in 1999, you probably didn't enjoy the same
performance as people who did.
As we've seen thus far in 2000, financial markets can be quite fickle,
revolving around investors' perceptions as much as hard facts. Because of the
ever-changing nature of the market environment, many high-performing mutual
funds don't repeat their gains from year to year. This doesn't necessarily mean
that a fund had
================================================================================
SEC SPEAKS OUT
In the wake of 1999's extraordinary fund performances, the Securities and
Exchange Commission (the SEC), which regulates the mutual fund industry, says
that investors should temper their expectations and not make investment
decisions based only on past performance. The SEC also suggests that investors
consider the following factors when looking at a mutual fund:
[Pie Chart]
Age
Risk
Size
Volatility
Management
Expenses
Tax Efficiency
Source: The Wall Street Journal, 1/25/00
================================================================================
AIM ADVISOR INTERNATIONAL VALUE FUND
5
<PAGE> 8
ANNUAL REPORT / FOR CONSIDERATION
a "bad" year or that fund managers chose holdings poorly. It may just mean that
the environment for a particular fund was not as ideal as it had been in the
past. This can be true for any mutual fund.
KEEP EXPECTATIONS REALISTIC
Along with recognizing how quickly the market environment can change, it's
important to keep your expectations realistic. Of course you would like your
investments to do well every year, but chances are they won't. It's the nature
of the beast. So what you should be shooting for is good performance over the
long term. While your investment may not have a stellar year every year, over
time its average returns may prove to be just what you hoped for.
Sometimes it's hard to be patient when it seems like everyone else's
investments are doing better than yours. You may be tempted to chase winning
performance by trying to time the market, switching in and out of funds as
markets or sectors go in and out of favor. But this strategy can greatly
increase your risk and it rarely works--you may end up with significantly lower
returns than if you'd just stayed put. (There can also be adverse tax
consequences.)
ASSET ALLOCATION: THE OLD STANDBY
The truth is, no one knows for sure what is going to perform well in the market,
which is why mutual fund investors should diversify using asset
allocation--spreading investments over several fund types (e.g., core, growth,
international and income). Unfortunately, some investors seem less interested in
asset allocation these days because they want to chase performance instead. And
when the market is roaring ahead, who can blame them?
But as Isaac Newton proved, what goes up must come down. A diversified
portfolio can offer some protection in a market downturn because when your
assets are spread over several different types of funds, chances are at least
one of them is keeping its head above water. And while a diversified fund
portfolio probably won't perform as well as the flashiest stock fund, it
probably won't do as badly as the worst of them either.
--------------------------------------------------------------------------------
Your financial advisor can help you determine what kinds of mutual funds best
fit your investment goals and risk tolerance. Talk to your financial advisor for
more information.
(1) Lipper, Inc. is an independent mutual fund performance monitor.
(2) The unmanaged Standard & Poor's Composite Index of 500 Stocks (the S&P 500)
represents the performance of the stock market.
(3) Source: Bloomberg.
================================================================================
DOLLAR-COST AVERAGING CAN LOWER THE COST OF INVESTING
One useful way to buy shares of a mutual fund is through dollar-cost averaging.
In such a plan, you invest a certain amount at regular intervals--say $200 per
month--which allows you to buy more shares when mutual fund prices go down and
fewer shares when prices go up. This gives you the benefit of your average cost
per share actually being less than the average price per share.
================================================================================
MONTH AMOUNT INVESTED SHARE PRICE SHARES PURCHASED
--------------------------------------------------------------------------------
JANUARY $ 200 $ 24 8.333
FEBRUARY 200 20 10.000
MARCH 200 14 14.286
APRIL 200 18 11.111
MAY 200 22 9.091
JUNE 200 24 8.333
6-MONTH TOTAL $1,200 $122 61.154
Average price per share: $122 divided by 6 = $20.33
Average cost per share: $1,200 divided by 61.154 = $19.62
================================================================================
Please keep in mind that this example is hypothetical and is not indicative of
the performance of any investment, IRA or AIM fund. Dollar-cost averaging does
not assure a profit and does not protect against loss in declining markets.
Since dollar-cost averaging involves continuous investing regardless of
fluctuating securities prices, investors should consider their ability to
continue purchases over an extended period of time.
For more complete information about any AIM fund(s), including sales charges and
expenses, ask your financial advisor or securities dealer for a free
prospectus(es). Please read the prospectus(es) carefully before you invest or
send money.
--------------------------------------------------------------------------------
AIM ADVISOR INTERNATIONAL VALUE FUND
6
<PAGE> 9
SCHEDULE OF INVESTMENTS
July 31, 2000
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
FOREIGN STOCKS & OTHER EQUITY
INTERESTS-97.15%
AUSTRALIA-4.13%
National Australia Bank Ltd.-ADR
(Banks-Regional) 40,000 $ 2,882,500
--------------------------------------------------------------
News Corp. Ltd. (The) (Publishing-
Newspapers) 100,000 1,210,528
--------------------------------------------------------------
Rio Tinto Ltd.-ADR (Metals Mining) 18,000 1,077,305
--------------------------------------------------------------
5,170,333
--------------------------------------------------------------
DENMARK-0.92%
Novo-Nordisk A.S.-ADR (Health
Care-Drugs-Major Pharmaceuticals) 12,000 1,153,500
--------------------------------------------------------------
FRANCE-7.23%
Michelin-Class B (Auto Parts &
Equipment) 30,000 898,699
--------------------------------------------------------------
Societe Generale (Banks-Major
Regional) 300,000 3,725,010
--------------------------------------------------------------
Total Fina Elf S.A.-ADR
(Oil-International Integrated) 43,833 3,224,465
--------------------------------------------------------------
Vivendi S.A.
(Manufacturing-Diversified) 15,000 1,199,193
--------------------------------------------------------------
9,047,367
--------------------------------------------------------------
GERMANY-8.05%
BASF A.G.-ADR
(Chemicals-Diversified) 60,000 2,468,520
--------------------------------------------------------------
Bayer A.G.-ADR
(Chemicals-Diversified) 35,000 1,465,915
--------------------------------------------------------------
DaimlerChrysler A.G. (Automobiles) 23,000 1,211,812
--------------------------------------------------------------
Deutsche Bank A.G.-ADR (Banks-Money
Center)(a) 30,000 2,699,247
--------------------------------------------------------------
SAP A.G.-ADR (Computers-Software &
Services) 40,000 2,230,000
--------------------------------------------------------------
10,075,494
--------------------------------------------------------------
HONG KONG-1.59%
Cheung Kong Holdings Ltd. (Land
Development)(a) 170,000 1,994,640
--------------------------------------------------------------
ITALY-5.27%
ENI S.p.A.-ADR (Oil-International
Integrated) 25,000 1,406,250
--------------------------------------------------------------
San Paolo-IMI S.p.A.-ADR
(Banks-Major Regional) 75,000 2,568,750
--------------------------------------------------------------
Telecom Italia S.p.A.-ADR
(Telephone) 20,000 2,612,500
--------------------------------------------------------------
6,587,500
--------------------------------------------------------------
JAPAN-23.05%
Bank of Tokyo-Mitsubishi Ltd. (The)
(Banks-Regional) 150,000 1,516,408
--------------------------------------------------------------
Canon, Inc.-ADR (Office Equipment &
Supplies) 75,000 3,412,500
--------------------------------------------------------------
Fuji Photo Film Co., Ltd.-ADR
(Photography/Imaging) 50,000 1,850,000
--------------------------------------------------------------
Hitachi Ltd.-ADR
(Manufacturing-Diversified) 15,000 1,798,125
--------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
JAPAN-(CONTINUED)
Honda Motor Co., Ltd.-ADR
(Automobiles) 20,000 $ 1,467,500
--------------------------------------------------------------
Ito-Yokado Co., Ltd.
(Retail-Department Stores) 20,000 1,190,520
--------------------------------------------------------------
Kyocera Corp.-ADR
(Electronics-Component Distributors) 20,000 2,920,000
--------------------------------------------------------------
LAWSON, INC. (Retail-Food Chains) 14,000 740,201
--------------------------------------------------------------
Mitsubishi Heavy Industries, Ltd.
(Machinery-Diversified) 300,000 1,110,301
--------------------------------------------------------------
Nintendo Co. Ltd. (Leisure
Time-Products) 11,000 1,802,917
--------------------------------------------------------------
Nippon Express Co., Ltd. (Truckers) 200,000 1,137,648
--------------------------------------------------------------
Nippon Telegraph & Telephone Corp.
(Telecommunications-Long Distance) 220 2,627,165
--------------------------------------------------------------
Shin-Etsu Chemical Co., Ltd.
(Chemicals-Diversified) 30,000 1,504,102
--------------------------------------------------------------
Sony Corp.-ADR (Electrical Equipment) 25,000 2,348,438
--------------------------------------------------------------
Takefuji Corp.
(Financial-Diversified) 15,000 1,504,102
--------------------------------------------------------------
Toyota Motor Corp. (Automobiles) 45,000 1,903,373
--------------------------------------------------------------
28,833,300
--------------------------------------------------------------
MEXICO-1.47%
Telefonos de Mexico S.A. de
C.V.-Class L-ADR (Telephone) 35,000 1,841,875
--------------------------------------------------------------
NETHERLANDS-10.61%
ABN AMRO Holding N.V. (Banks-Major
Regional) 60,000 1,457,395
--------------------------------------------------------------
ING Groep N.V.-ADR
(Insurance-Life/Health) 50,000 3,362,500
--------------------------------------------------------------
Koninklijke (Royal) Philips
Electronics N.V.-ADR (Electrical
Equipment) 80,000 3,595,000
--------------------------------------------------------------
Royal Dutch Petroleum Co.-ADR-New
York Shares (Oil-International
Integrated) 45,000 2,621,250
--------------------------------------------------------------
Unilever N.V.-ADR (Foods) 50,642 2,240,909
--------------------------------------------------------------
13,277,054
--------------------------------------------------------------
PORTUGAL-2.29%
Portugal Telecom S.A.-ADR
(Telephone) 256,500 2,869,594
--------------------------------------------------------------
SOUTH KOREA-0.90%
Korea Telecom Corp.-ADR (Telephone) 30,000 1,121,250
--------------------------------------------------------------
SPAIN-4.61%
Banco Popular Espanol S.A.
(Banks-Major Regional) 40,000 1,187,136
--------------------------------------------------------------
Endesa S.A.-ADR (Electric Companies) 130,000 2,697,500
--------------------------------------------------------------
Repsol S.A.-ADR (Oil-International
Integrated) 100,000 1,887,500
--------------------------------------------------------------
5,772,136
--------------------------------------------------------------
SWITZERLAND-5.95%
Nestle S.A.-ADR (Foods) 30,000 3,124,869
--------------------------------------------------------------
</TABLE>
7
<PAGE> 10
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
SWITZERLAND-(CONTINUED)
Novartis A.G.-ADR (Health
Care-Drugs-Major Pharmaceuticals) 70,000 $ 2,702,021
--------------------------------------------------------------
Zurich Allied A.G.
(Insurance-Multi-Line) 3,000 1,618,171
--------------------------------------------------------------
7,445,061
--------------------------------------------------------------
UNITED KINGDOM-21.08%
AstraZeneca Group PLC-ADR (Health
Care-Drugs-Major Pharmaceuticals) 45,000 1,923,750
--------------------------------------------------------------
British Airways PLC-ADR (Airlines) 30,000 1,681,875
--------------------------------------------------------------
British Telecommunications PLC
(Telephone) 20,000 2,660,000
--------------------------------------------------------------
Carlton Communications PLC-ADR
(Electrical Equipment) 40,000 2,355,000
--------------------------------------------------------------
Corus Group PLC-ADR (Iron & Steel) 75,000 984,375
--------------------------------------------------------------
Diageo PLC (Beverages-Alcoholic) 200,000 1,756,242
--------------------------------------------------------------
Glaxo Wellcome PLC-ADR (Health
Care-Drugs-Major Pharmaceuticals) 40,000 2,285,000
--------------------------------------------------------------
HSBC Holdings PLC-ADR (Banks-Money
Center) 70,000 4,851,875
--------------------------------------------------------------
Marks & Spencer PLC
(Retail-Department Stores) 300,000 980,019
--------------------------------------------------------------
PowerGen PLC-ADR (Electric Companies) 45,000 1,631,250
--------------------------------------------------------------
Royal Bank of Scotland Group PLC
(Banks-Major Regional) 79,960 1,260,507
--------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
UNITED KINGDOM-(CONTINUED)
Royal Bank of Scotland Group
PLC-Value Shares (Banks-Major
Regional)(a) 67,760 $ 80,469
--------------------------------------------------------------
Scottish Power PLC (Electric
Companies) 200,000 1,678,320
--------------------------------------------------------------
SmithKline Beecham PLC-ADR (Health
Care-Drugs-Major Pharmaceuticals) 35,000 2,240,000
--------------------------------------------------------------
26,368,682
--------------------------------------------------------------
Total Foreign Stocks & Other
Equity Interests (Cost
$94,999,837) 121,557,786
--------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
<S> <C> <C>
U.S. GOVERNMENT AGENCY SECURITIES-2.46%
FEDERAL NATIONAL MORTGAGE
ASSOCIATION ("FNMA")-2.46%
Disc. Notes, 6.43%, 08/01/00 (Cost
$3,080,000)(b) $3,080,000 3,080,000
--------------------------------------------------------------
TOTAL INVESTMENTS-99.61%
(Cost $98,079,837) 124,637,786
--------------------------------------------------------------
OTHER ASSETS LESS LIABILITIES-0.39% 482,005
--------------------------------------------------------------
NET ASSETS-100.00% $125,119,791
--------------------------------------------------------------
</TABLE>
Investment Abbreviations:
ADR - American Depositary Receipt
Disc. - Discounted
Notes to Schedule of Investments:
(a) Non-income producing security.
(b) Interest rate shown represents the rate of discount paid or received at the
time of purchase by the Fund.
See Notes to Financial Statements.
8
<PAGE> 11
SCHEDULE OF INVESTMENTS
June 30, 2000
(Unaudited)
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
FOREIGN STOCKS & OTHER EQUITY
INTERESTS-99.73%
AUSTRALIA-4.46%
National Australia Bank Ltd.-ADR
(Banks-Regional) 40,000 $ 3,310,000
-------------------------------------------------------------
News Corp. Ltd. (The)
(Publishing-Newspapers) 100,000 1,373,790
-------------------------------------------------------------
Rio Tinto Ltd.-ADR (Metals Mining) 18,000 1,193,976
-------------------------------------------------------------
5,877,766
-------------------------------------------------------------
DENMARK-1.60%
Novo-Nordisk A.S.-ADR (Health
Care-Drugs- Major Pharmaceuticals) 25,000 2,112,500
-------------------------------------------------------------
FRANCE-7.03%
Michelin-Class B (Auto Parts &
Equipment) 30,000 960,759
-------------------------------------------------------------
Societe Generale (Banks-Major
Regional) 300,000 3,623,460
-------------------------------------------------------------
Total Fina Elf S.A.-ADR
(Oil-International Integrated) 43,833 3,366,922
-------------------------------------------------------------
Vivendi S.A.
(Manufacturing-Diversified) 15,000 1,321,365
-------------------------------------------------------------
9,272,506
-------------------------------------------------------------
GERMANY-7.78%
BASF A.G.-ADR
(Chemicals-Diversified) 60,000 2,441,526
-------------------------------------------------------------
Bayer A.G.-ADR
(Chemicals-Diversified) 45,000 1,759,968
-------------------------------------------------------------
DaimlerChrysler A.G. (Automobiles) 23,000 1,197,437
-------------------------------------------------------------
Deutsche Bank A.G.-ADR (Banks-Money
Center)(a) 36,000 2,981,596
-------------------------------------------------------------
SAP A.G.-ADR (Computers-Software &
Services) 40,000 1,877,500
-------------------------------------------------------------
10,258,027
-------------------------------------------------------------
HONG KONG-1.41%
Cheung Kong Holdings Ltd. (Land
Development)(a) 170,000 1,864,537
-------------------------------------------------------------
ITALY-6.49%
ENI S.p.A.-ADR (Oil-International
Integrated) 25,000 1,454,687
-------------------------------------------------------------
San Paolo-IMI S.p.A.-ADR
(Banks-Major Regional) 100,000 3,537,500
-------------------------------------------------------------
Telecom Italia Mobile S.p.A.
(Telecommunications-Cellular/
Wireless) 80,000 815,640
-------------------------------------------------------------
Telecom Italia S.p.A.-ADR
(Telephone) 20,000 2,751,250
-------------------------------------------------------------
8,559,077
-------------------------------------------------------------
JAPAN-24.80%
Bank of Tokyo-Mitsubishi Ltd. (The)
(Banks-Regional) 150,000 1,809,919
-------------------------------------------------------------
Canon, Inc.-ADR (Office Equipment &
Supplies) 75,000 3,778,125
-------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
JAPAN-(CONTINUED)
Fuji Photo Film Co., Ltd.-ADR
(Photography/Imaging) 50,000 $ 2,118,750
-------------------------------------------------------------
Hitachi Ltd.-ADR
(Manufacturing-Diversified) 15,000 2,161,875
-------------------------------------------------------------
Honda Motor Co., Ltd.-ADR
(Automobiles) 20,000 1,375,000
-------------------------------------------------------------
Ito-Yokado Co., Ltd.
(Retail-Department Stores) 20,000 1,201,903
-------------------------------------------------------------
Kyocera Corp.-ADR
(Electronics-Component Distributors) 23,000 3,951,687
-------------------------------------------------------------
Mitsubishi Heavy Industries, Ltd.
(Machinery-Diversified) 300,000 1,328,121
-------------------------------------------------------------
Nintendo Co. Ltd. (Leisure
Time-Products) 17,000 2,965,572
-------------------------------------------------------------
Nippon Express Co., Ltd. (Truckers) 200,000 1,226,393
-------------------------------------------------------------
Nippon Telegraph & Telephone Corp.
(Telecommunications-Long Distance) 220 2,921,867
-------------------------------------------------------------
Shin-Etsu Chemical Co., Ltd.
(Chemicals-Diversified) 30,000 1,520,275
-------------------------------------------------------------
Sony Corp.-ADR (Electrical Equipment) 20,000 1,886,250
-------------------------------------------------------------
Takefuji Corp.
(Financial-Diversified) 20,000 2,413,225
-------------------------------------------------------------
Toyota Motor Corp. (Automobiles) 45,000 2,047,285
-------------------------------------------------------------
32,706,247
-------------------------------------------------------------
MEXICO-1.51%
Telefonos de Mexico S.A. de
C.V.-Class L-ADR (Telephone) 35,000 1,999,375
-------------------------------------------------------------
NETHERLANDS-10.91%
ABN AMRO Holding N.V. (Banks-Major
Regional) 60,000 1,467,008
-------------------------------------------------------------
ING Groep N.V.-ADR
(Insurance-Life/Health) 60,000 4,050,000
-------------------------------------------------------------
Koninklijke (Royal) Philips
Electronics N.V.-ADR (Electrical
Equipment) 80,000 3,800,000
-------------------------------------------------------------
Royal Dutch Petroleum Co.-ADR-New
York Shares (Oil-International
Integrated) 45,000 2,770,312
-------------------------------------------------------------
Unilever N.V.-ADR (Foods) 50,642 2,307,376
-------------------------------------------------------------
14,394,696
-------------------------------------------------------------
PORTUGAL-2.19%
Portugal Telecom S.A.-ADR
(Telephone) 256,500 2,885,625
-------------------------------------------------------------
SOUTH KOREA-1.10%
Korea Telecom Corp.-ADR (Telephone) 30,000 1,451,250
-------------------------------------------------------------
SPAIN-4.36%
Banco Popular Espanol S.A.
(Banks-Major Regional) 40,000 1,234,894
-------------------------------------------------------------
Endesa S.A.-ADR (Electric Companies) 130,000 2,535,000
-------------------------------------------------------------
</TABLE>
9
<PAGE> 12
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
SPAIN-(CONTINUED)
Repsol S.A.-ADR (Oil-International
Integrated) 100,000 $ 1,981,250
-------------------------------------------------------------
5,751,144
-------------------------------------------------------------
SWITZERLAND-5.51%
Nestle S.A.-ADR (Foods) 30,000 3,011,862
-------------------------------------------------------------
Novartis A.G.-ADR (Health
Care-Drugs-Major Pharmaceuticals) 70,000 2,780,939
-------------------------------------------------------------
Zurich Allied A.G.
(Insurance-Multi-Line) 3,000 1,478,718
-------------------------------------------------------------
7,271,519
-------------------------------------------------------------
UNITED KINGDOM-20.58%
AstraZeneca Group PLC-ADR (Health
Care- Drugs-Major Pharmaceuticals) 45,000 2,092,500
-------------------------------------------------------------
British Airways PLC-ADR (Airlines) 30,000 1,725,000
-------------------------------------------------------------
British Telecommunications PLC
(Telephone) 20,000 2,645,000
-------------------------------------------------------------
Carlton Communications PLC-ADR
(Electrical Equipment) 47,500 3,087,500
-------------------------------------------------------------
Corus Group PLC-ADR (Iron & Steel) 75,000 1,078,125
-------------------------------------------------------------
Diageo PLC (Beverages-Alcoholic) 150,000 1,345,725
-------------------------------------------------------------
Glaxo Wellcome PLC-ADR (Health
Care-Drugs- Major Pharmaceuticals) 40,000 2,312,500
-------------------------------------------------------------
HSBC Holdings PLC-ADR (Banks-Money
Center) 75,000 4,345,312
-------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
UNITED KINGDOM-(CONTINUED)
Marks & Spencer PLC
(Retail-Department Stores) 300,000 $ 1,054,113
-------------------------------------------------------------
PowerGen PLC-ADR (Electric
Companies) 55,000 1,925,000
-------------------------------------------------------------
Royal Bank of Scotland Group PLC
(Banks-Major Regional) 67,760 1,133,806
-------------------------------------------------------------
Scottish Power PLC (Electric
Companies) 250,000 2,118,060
-------------------------------------------------------------
SmithKline Beecham PLC-ADR (Health
Care- Drugs-Major Pharmaceuticals) 35,000 2,281,563
-------------------------------------------------------------
27,144,204
-------------------------------------------------------------
Total Foreign Stocks & Other
Equity Interests (Cost
$98,249,056) 131,548,473
-------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
<S> <C> <C>
U.S. GOVERNMENT AGENCY SECURITIES-0.46%
FEDERAL NATIONAL MORTGAGE
ASSOCIATION ("FNMA")-0.46%
Disc. Notes, 6.57%, 07/03/00 (Cost
$598,782)(b) $599,000 598,781
--------------------------------------------------------------
TOTAL INVESTMENTS-100.19% (Cost
$98,847,838) 132,147,254
--------------------------------------------------------------
LIABILITIES LESS OTHER ASSETS-(0.19%) (246,380)
--------------------------------------------------------------
NET ASSETS-100.00% $131,900,874
--------------------------------------------------------------
</TABLE>
Investment Abbreviations:
ADR - American Depositary Receipt
Disc. - Discounted
Notes to Schedule of Investments:
(a) Non-income producing security.
(b) Interest rate shown represents the rate of discount paid or received at the
time of purchase by the Fund.
See Notes to Financial Statements.
10
<PAGE> 13
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
JUNE 30,
JULY 31, 2000
2000 (UNAUDITED)
------------ ------------
<S> <C> <C>
ASSETS:
Investments, at market value (cost $98,079,837 and
$98,847,838, respectively) $124,637,786 $132,147,254
-----------------------------------------------------------------------------------------
Foreign currencies, at value (cost $23,901 and $1,108,760,
respectively) 23,827 1,098,521
-----------------------------------------------------------------------------------------
Cash 642 576
-----------------------------------------------------------------------------------------
Receivables for:
Investments sold 738,268 182,942
-----------------------------------------------------------------------------------------
Capital stock sold 497,935 80,599
-----------------------------------------------------------------------------------------
Dividends 314,578 515,359
-----------------------------------------------------------------------------------------
Investment for deferred compensation plan 14,735 13,478
-----------------------------------------------------------------------------------------
Other assets 995 --
-----------------------------------------------------------------------------------------
Total assets 126,228,766 134,038,729
-----------------------------------------------------------------------------------------
LIABILITIES:
Payables for:
Capital stock reacquired 695,868 1,738,486
-----------------------------------------------------------------------------------------
Deferred compensation plan 14,735 13,478
-----------------------------------------------------------------------------------------
Accrued advisory fees 107,493 108,556
-----------------------------------------------------------------------------------------
Accrued administrative services fees 4,235 4,098
-----------------------------------------------------------------------------------------
Accrued distribution fees 212,368 239,727
-----------------------------------------------------------------------------------------
Accrued directors' fees 716 1,661
-----------------------------------------------------------------------------------------
Accrued transfer agent fees 13,389 12,383
-----------------------------------------------------------------------------------------
Accrued operating expenses 60,171 19,466
-----------------------------------------------------------------------------------------
Total liabilities 1,108,975 2,137,855
-----------------------------------------------------------------------------------------
Net assets applicable to shares outstanding $125,119,791 $131,900,874
=========================================================================================
NET ASSETS:
Class A $ 30,152,891 $ 33,022,368
=========================================================================================
Class B $ 5,883,077 $ 5,950,924
=========================================================================================
Class C $ 89,083,823 $ 92,927,582
=========================================================================================
CAPITAL STOCK, $0.001 PAR VALUE PER SHARE:
Class A:
Authorized 100,000,000 100,000,000
-----------------------------------------------------------------------------------------
Outstanding 1,605,646 1,703,696
=========================================================================================
Class B:
Authorized 100,000,000 100,000,000
-----------------------------------------------------------------------------------------
Outstanding 316,442 309,982
=========================================================================================
Class C:
Authorized 100,000,000 100,000,000
-----------------------------------------------------------------------------------------
Outstanding 4,795,176 4,843,196
=========================================================================================
Class A:
Net asset value and redemption price per share $ 18.78 $ 19.38
-----------------------------------------------------------------------------------------
Offering price per share:
(Net asset value divided by 94.50%) $ 19.87 $ 20.51
=========================================================================================
Class B:
Net asset value and offering price per share $ 18.59 $ 19.20
=========================================================================================
Class C:
Net asset value and offering price per share $ 18.58 $ 19.19
=========================================================================================
</TABLE>
See Notes to Financial Statements.
11
<PAGE> 14
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS
SEVEN MONTHS ENDED YEAR
ENDED JUNE 30, ENDED
JULY 31, 2000 DECEMBER 31,
2000 (UNAUDITED) 1999
------------ ------------ ------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Dividends (net of foreign withholding tax $277,017, $256,079
and $350,255, respectively) $ 1,676,497 $ 1,484,243 $ 2,789,892
--------------------------------------------------------------------------------------------------------
Interest 56,132 51,758 110,773
--------------------------------------------------------------------------------------------------------
Total investment income 1,732,629 1,536,001 2,900,665
--------------------------------------------------------------------------------------------------------
EXPENSES:
Advisory fees 773,221 665,728 1,307,027
--------------------------------------------------------------------------------------------------------
Administrative services fee 29,098 24,863 25,721
--------------------------------------------------------------------------------------------------------
Custodian fees 23,564 13,199 29,499
--------------------------------------------------------------------------------------------------------
Operating services fees -- -- 290,546
--------------------------------------------------------------------------------------------------------
Distribution fees-Class A 65,582 56,171 94,674
--------------------------------------------------------------------------------------------------------
Distribution fees-Class B 32,963 27,940 42,551
--------------------------------------------------------------------------------------------------------
Distribution fees-Class C 552,881 475,072 993,935
--------------------------------------------------------------------------------------------------------
Transfer agent fees-Class A 16,951 14,567 17,199
--------------------------------------------------------------------------------------------------------
Transfer agent fees-Class B 3,874 3,222 7,228
--------------------------------------------------------------------------------------------------------
Transfer agent fees-Class C 64,971 54,749 65,930
--------------------------------------------------------------------------------------------------------
Directors' fees 4,287 3,682 3,847
--------------------------------------------------------------------------------------------------------
Other 99,919 62,776 45,538
--------------------------------------------------------------------------------------------------------
Total expenses 1,667,311 1,401,969 2,923,695
--------------------------------------------------------------------------------------------------------
Less: Fees waived (19,428) (16,739) (166,253)
--------------------------------------------------------------------------------------------------------
Expenses paid indirectly (900) (724) (759)
--------------------------------------------------------------------------------------------------------
Net expenses 1,646,983 1,384,506 2,756,683
--------------------------------------------------------------------------------------------------------
Net investment income 85,646 151,495 143,982
--------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENT SECURITIES
AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment securities 14,076,218 11,326,128 7,711,836
--------------------------------------------------------------------------------------------------------
Foreign currencies (175,641) (131,163) (100,916)
--------------------------------------------------------------------------------------------------------
13,900,577 11,194,965 7,610,920
--------------------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) of:
Investment securities (22,688,472) (15,947,005) 18,910,641
--------------------------------------------------------------------------------------------------------
Foreign currencies (411) (10,194) 1,968
--------------------------------------------------------------------------------------------------------
(22,688,883) (15,957,199) 18,912,609
--------------------------------------------------------------------------------------------------------
Net gain (loss) on investment securities and foreign
currencies (8,788,306) (4,762,234) 26,523,529
--------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations $(8,702,660) $ (4,610,739) $ 26,667,511
========================================================================================================
</TABLE>
See Notes to Financial Statements.
12
<PAGE> 15
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS
SEVEN MONTHS ENDED YEAR ENDED YEAR ENDED
ENDED JUNE 30, 2000 DECEMBER 31, DECEMBER 31,
JULY 31, 2000 (UNAUDITED) 1999 1998
------------- -------------- ------------ ------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income $ 85,646 $ 151,495 $ 143,982 $ 226,806
--------------------------------------------------------------------------------------------------------------------------
Net realized gain (loss) from investment securities and
foreign currencies 13,900,577 11,194,965 7,610,920 (5,494,200)
--------------------------------------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) of
investment securities and foreign currencies (22,688,883) (15,957,199) 18,912,609 15,275,348
--------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations (8,702,660) (4,610,739) 26,667,511 10,007,954
--------------------------------------------------------------------------------------------------------------------------
Distributions to shareholders from net investment income:
Class A -- -- (432,681) (160,712)
--------------------------------------------------------------------------------------------------------------------------
Class B -- -- (42,668) --
--------------------------------------------------------------------------------------------------------------------------
Class C -- -- (838,386) --
--------------------------------------------------------------------------------------------------------------------------
Distributions to shareholders from net realized gains:
Class A -- -- (115,532) (237)
--------------------------------------------------------------------------------------------------------------------------
Class B -- -- (20,873) (51)
--------------------------------------------------------------------------------------------------------------------------
Class C -- -- (410,586) (1,274)
--------------------------------------------------------------------------------------------------------------------------
Share transactions-net:
Class A 396,487 2,296,078 (2,103,894) 18,784,781
--------------------------------------------------------------------------------------------------------------------------
Class B 576,201 455,168 446,063 4,303,232
--------------------------------------------------------------------------------------------------------------------------
Class C (13,025,971) (12,115,367) (14,925,148) 3,112,106
--------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets (20,755,943) (13,974,860) 8,223,806 36,045,799
--------------------------------------------------------------------------------------------------------------------------
NET ASSETS:
Beginning of period 145,875,734 145,875,734 137,651,928 101,606,129
--------------------------------------------------------------------------------------------------------------------------
End of period $125,119,791 $131,900,874 $145,875,734 $137,651,928
==========================================================================================================================
NET ASSETS CONSIST OF:
Capital (par value and additional paid-in) $ 84,520,202 $ 87,211,937 $96,576,058 $113,159,037
--------------------------------------------------------------------------------------------------------------------------
Undistributed net investment income (470,742) (1,056,510) (1,208,005) 58,330
--------------------------------------------------------------------------------------------------------------------------
Undistributed net realized gain (loss) from investment
securities and foreign currencies 14,512,653 12,456,085 1,261,120 (5,899,391)
--------------------------------------------------------------------------------------------------------------------------
Unrealized appreciation of investment securities and
foreign currencies 26,557,678 33,289,362 49,246,561 30,333,952
--------------------------------------------------------------------------------------------------------------------------
$125,119,791 $131,900,874 $145,875,734 $137,651,928
==========================================================================================================================
</TABLE>
See Notes to Financial Statements.
13
<PAGE> 16
NOTES TO FINANCIAL STATEMENTS
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES
AIM Advisor International Value Fund (the "Fund") is a series portfolio of AIM
Advisor Funds, Inc. (the "Company"). The Company is a Maryland corporation
registered under the Investment Company Act of 1940, as amended (the "1940
Act"), as an open-end series management investment company consisting of three
separate portfolios. The Board of Directors of the Company approved a change in
the Fund's fiscal year-end from December 31 to July 31. As a result, this report
includes financial information for the period ended July 31, 2000 (seven
months), the six months ended June 30, 2000 and the year ended December 31,
1999. Financial information for the six months ended June 30, 2000 is unaudited.
The Fund currently offers three different classes of shares: Class A shares,
Class B shares and Class C shares. Class A shares are sold with a front-end
sales charge. Class B shares and Class C shares are sold with a contingent
deferred sales charge. Matters affecting each portfolio or class will be voted
on exclusively by the shareholders of such portfolio or class. The assets,
liabilities and operations of each portfolio are accounted for separately.
Information presented in these financial statements pertains only to the Fund.
The Fund's investment objective is to achieve high total return.
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Actual results
could differ from those estimates. The following is a summary of the significant
accounting policies followed by the Fund in the preparation of its financial
statements.
A. Security Valuations -- A security listed or traded on an exchange (except
convertible bonds) is valued at its last sales price as of the close of the
customary trading session on the exchange where the security is principally
traded, or lacking any sales on a particular day, the security is valued at
the closing bid price on that day. Each security reported on the NASDAQ
National Market System is valued at the last sales price as of the close of
the customary trading session on the valuation date or absent a last sales
price, at the closing bid price. Debt obligations (including convertible
bonds) are valued on the basis of prices provided by an independent pricing
service. Prices provided by the pricing service may be determined without
exclusive reliance on quoted prices, and may reflect appropriate factors such
as yield, type of issue, coupon rate and maturity date. Securities for which
market prices are not provided by any of the above methods are valued based
upon quotes furnished by independent sources and are valued at the last bid
price in the case of equity securities and in the case of debt obligations,
the mean between the last bid and asked prices. Securities for which market
quotations are not readily available or are questionable are valued at fair
value as determined in good faith by or under the supervision of the
Company's officers in a manner specifically authorized by the Board of
Directors of the Company. Short-term obligations having 60 days or less to
maturity are valued at amortized cost which approximates market value. For
purposes of determining net asset value per share, futures and option
contracts generally will be valued 15 minutes after the close of the
customary trading session of the New York Stock Exchange ("NYSE").
Generally, trading in foreign securities is substantially completed each day
at various times prior to the close of the NYSE. The values of such securities
used in computing the net asset value of the Fund's shares are determined as
of such times. Foreign currency exchange rates are also generally determined
prior to the close of the NYSE. Occasionally, events affecting the values of
such securities and such exchange rates may occur between the times at which
they are determined and the close of the customary trading session of the NYSE
which would not be reflected in the computation of the Fund's net asset value.
If events materially affecting the value of such securities occur during such
period, then these securities will be valued at their fair value as determined
in good faith by or under the supervision of the Board of Directors.
B. Securities Transactions and Investment Income -- Securities transactions are
accounted for on a trade date basis. Realized gains or losses on sales are
computed on the basis of specific identification of the securities sold.
Interest income is recorded on the accrual basis from settlement date.
Dividend income is recorded on the ex-dividend date.
On July 31, 2000, undistributed net investment income was increased by
$651,617, undistributed net realized gains decreased by $649,044 and paid-in
capital decreased by $2,573 as a result of differing book/tax treatment of
foreign currency transactions and foreign tax credits. Net assets of the Fund
were unaffected by the reclassifications.
C. Distributions -- Distributions from income and net realized capital gains, if
any, are generally paid annually and recorded on ex-dividend date. The Fund
may elect to use a portion of the proceeds from redemptions as distributions
for federal income tax purposes.
D. Federal Income Taxes -- The Fund intends to comply with the requirements of
the Internal Revenue Code necessary to qualify as a regulated investment
company and, as such, will not be subject to federal income taxes on
otherwise taxable income (including net realized capital gains) which is
distributed to shareholders. Therefore, no provision for federal income taxes
is recorded in the financial statements.
E. Foreign Currency Translations -- Portfolio securities and other assets and
liabilities denominated in foreign currencies are translated into U.S. dollar
amounts at date of valuation. Purchases and sales of portfolio securities and
income items denominated in foreign currencies are translated into U.S.
dollar amounts on the respective dates of such transactions. The Fund does
not separately account for the portion of the results of operations resulting
from changes in foreign exchange rates on investments and the fluctuations
arising from changes in market prices of securities held. Such fluctuations
14
<PAGE> 17
are included with the net realized and unrealized gain or loss from
investments.
F. Foreign Currency Contracts -- A foreign currency contract is an obligation to
purchase or sell a specific currency for an agreed-upon price at a future
date. The Fund may enter into a foreign currency contract to attempt to
minimize the risk to the Fund from adverse changes in the relationship
between currencies. The Fund may also enter into a foreign currency contract
for the purchase or sale of a security denominated in a foreign currency in
order to "lock in" the U.S. dollar price of that security. The Fund could be
exposed to risk if counterparties to the contracts are unable to meet the
terms of their contracts or if the value of the foreign currency changes
unfavorably.
G. Expenses -- Distribution expenses and certain transfer agency expenses
directly attributable to a class of shares are charged to those classes'
operations. All other expenses which are attributable to more than one class
are allocated among the classes.
NOTE 2-ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES
The Company has entered into a master investment advisory agreement with A I M
Advisors, Inc. ("AIM"). Under the terms of the investment advisory agreement,
the Fund pays an advisory fee to AIM at the annual rate of 1.00% of the Fund's
average daily net assets. AIM has entered into a sub-advisory agreement with
INVESCO Global Asset Management (N.A.), Inc. (IGAM) (formerly known as INVESCO
Global Asset Management Limited) whereby AIM pays IGAM an annual rate of 0.35%
of the first $50 million of the Fund's average daily net assets, plus 0.30% of
the Fund's average daily net assets in excess of $50 million to and including
$100 million, plus 0.25% of the Fund's average daily net assets in excess of
$100 million. During the seven month period ended July 31, 2000 and the six
months ended June 30, 2000, AIM waived fees of $690 and $690, respectively.
The Fund, pursuant to a master administrative services agreement with AIM, has
agreed to pay AIM for certain administrative costs incurred in providing
accounting services to the Fund. For the seven-month period ended July 31, 2000,
the six months ended June 30, 2000 and for the period July 1, 1999 through
December 31, 1999, AIM was paid $29,098, $24,863 and $25,721, respectively, for
such services.
The Fund, pursuant to a transfer agency and service agreement, has agreed to
pay A I M Fund Services, Inc. ("AFS") a fee for providing transfer agency and
shareholder services to the Fund. For the seven-month period ended July 31,
2000, the six months ended June 30, 2000 and for the period July 1, 1999 through
December 31, 1999, AFS was paid $37,793, $32,596 and $34,877, respectively, for
such services.
The Fund, pursuant to an operating services agreement, paid AIM $151,347 for
operating services fees during the period January 1, 1999 through July 31, 1999.
AIM waived operating services fees of $139,199 during the period January 1, 1999
through July 31, 1999.
The Company has entered into master distribution agreements with A I M
Distributors, Inc. ("AIM Distributors") to serve as the distributor for the
Class A, Class B and Class C shares of the Fund. The Company has adopted plans
pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund's Class A
shares, Class B shares and Class C shares (collectively the "Plans"). The Fund,
pursuant to the Plans, pays AIM Distributors compensation at the annual rate of
0.35% of the Fund's average daily net assets of Class A shares and 1.00% of the
average daily net assets of Class B and C shares. AIM Distributors has
contractually agreed to limit the Class A shares plan payments to 0.25%. Of
these amounts, the Fund may pay a service fee of 0.25% of the average daily net
assets of the Class A, Class B or Class C shares to selected dealers and
financial institutions who furnish continuing personal shareholder services to
their customers who purchase and own the appropriate class of shares of the
Fund. Any amounts not paid as a service fee under the Plans would constitute an
asset-based sales charge. The Plans also impose a cap on the total sales
charges, including asset-based sales charges that may be paid by the respective
classes. For the seven-month period ended July 31, 2000, the Class A, Class B
and Class C shares paid AIM Distributors $65,582, $32,963 and $552,881,
respectively, as compensation under the Plans. For the six months ended June 30,
2000, the Class A, Class B and Class C shares paid AIM Distributors $56,171,
$27,940 and $475,072, respectively, as compensation under the Plans. For the
year ended December 31, 1999, the Class A, Class B and Class C shares paid AIM
Distributors $67,620, $42,551 and $993,935, respectively, as compensation under
the Plans. During the seven-month period ended July 31, 2000, the six months
ended June 30, 2000 and the year ended December 31, 1999, AIM Distributors
waived fees of $18,738, $16,049 and $27,054, respectively, for Class A shares.
AIM Distributors received commissions of $5,457, $4,797 and $9,075 from sales
of the Class A shares of the Fund during the seven-month period ended July 31,
2000, the six months ended June 30, 2000 and the year ended December 31, 1999,
respectively. Such commissions are not an expense of the Fund. They are deducted
from, and are not included in, the proceeds from sales of Class A shares. During
the seven-month period ended July 31, 2000, the six months ended June 30, 2000
and the year ended December 31, 1999, AIM Distributors received $25,282, $24,352
and $63,088, respectively, in contingent deferred sales charges imposed on
redemptions of Fund shares.
Certain officers and directors of the Company are officers and directors of
AIM, AFS and AIM Distributors.
During the seven-month period ended July 31, 2000, the six months ended June
30, 2000 and the year ended December 31, 1999, the Fund paid legal fees of
$2,350, $1,807 and $1,087, respectively, for services rendered by Kramer, Levin,
Naftalis & Frankel LLP as counsel to the Company's directors. A member of that
firm is a director of the Company.
NOTE 3-INDIRECT EXPENSES
For the seven-month period ended July 31, 2000, the six months ended June 30,
2000 and the year ended December 31, 1999, the Fund received reductions in
transfer agency fees from AFS (an affiliate of AIM) of $900, $724 and $759,
respectively, under expense offset arrangements which resulted in a reduction of
the Fund's total expenses of $900, $724 and $759 for the seven-month
15
<PAGE> 18
period ended July 31, 2000, the six months ended June 30, 2000 and the year
ended December 31, 1999, respectively.
NOTE 4-DIRECTORS' FEES
Directors' fees represent remuneration paid to directors who are not an
"interested person" of AIM. The Company invests directors' fees, if so elected
by a director, in mutual fund shares in accordance with a deferred compensation
plan.
NOTE 5-BANK BORROWINGS
The Fund is a participant in a committed line of credit facility with a
syndicate administered by Citibank, N.A. The Fund may borrow up to the lesser of
(i) $1,000,000,000 or (ii) the limits set by its prospectus for borrowings. The
Fund and other funds advised by AIM which are parties to the line of credit may
borrow on a first come, first served basis. During the seven-month period ended
July 31, 2000, the Fund did not borrow under the line of credit agreement. The
funds which are party to the line of credit are charged a commitment fee of
0.09% on the unused balance of the committed line. The commitment fee is
allocated among the funds based on their respective average net assets for the
period.
NOTE 6-INVESTMENT SECURITIES
The aggregate amount of investment securities (other than short-term securities)
purchased and sold by the Fund during the seven-month period ended July 31, 2000
was $23,495,845 and $38,592,387, respectively, and during the six months ended
June 30, 2000 was $21,323,256 and $30,420,490, respectively. The amount of
unrealized appreciation (depreciation) of investment securities, for tax
purposes, is as follows:
<TABLE>
<CAPTION>
JUNE 30, 2000
JULY 31, 2000 (UNAUDITED)
------------- --------------
<S> <C> <C>
Aggregate unrealized
appreciation of investment
securities $33,237,321 $39,557,669
--------------------------------------------------------------
Aggregate unrealized
(depreciation) of investment
securities (7,133,184) (5,505,428)
==============================================================
Net unrealized appreciation of
investment securities $26,104,137 $34,052,241
==============================================================
</TABLE>
Cost of investments for tax purposes is $98,533,649.
NOTE 7-CAPITAL STOCK
Changes in capital stock outstanding during the seven-month period ended July
31, 2000, the six months ended June 30, 2000 and the years ended December 31,
1999 and 1998 were as follows:
<TABLE>
<CAPTION>
JUNE 30, 2000
JULY 31, 2000 (UNAUDITED) DECEMBER 31, 1999
-------------------------- -------------------------- ---------------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
---------- ------------ ---------- ------------ ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
Sold:
Class A 709,637 $ 13,249,138 646,697 $ 12,042,877 1,038,717 $ 17,709,368
--------------------------------------------------------------------------------------------------------------------
Class B 80,824 1,502,635 67,418 1,248,372 154,805 2,600,272
--------------------------------------------------------------------------------------------------------------------
Class C 437,361 8,098,953 396,898 7,326,683 914,757 15,303,016
--------------------------------------------------------------------------------------------------------------------
Issued as reinvestment of
dividends:
Class A -- -- -- -- 28,852 526,848
--------------------------------------------------------------------------------------------------------------------
Class B -- -- -- -- 3,257 59,148
--------------------------------------------------------------------------------------------------------------------
Class C -- -- -- -- 59,722 1,083,956
--------------------------------------------------------------------------------------------------------------------
Reacquired:
Class A (680,668) (12,852,651) (519,678) (9,746,799) (1,198,053) (20,340,110)
--------------------------------------------------------------------------------------------------------------------
Class B (49,271) (926,434) (42,325) (793,204) (133,374) (2,213,357)
--------------------------------------------------------------------------------------------------------------------
Class C (1,138,356) (21,124,924) (1,049,873) (19,442,050) (1,855,582) (31,312,120)
--------------------------------------------------------------------------------------------------------------------
(640,473) $(12,053,283) (500,863) $ (9,364,121) (986,899) $(16,582,979)
====================================================================================================================
<CAPTION>
DECEMBER 31, 1998
--------------------------
SHARES AMOUNT
---------- ------------
<S> <C> <C>
Sold:
Class A 1,753,054 $ 28,241,964
--------------------------------------------------------
Class B 309,463 5,088,103
--------------------------------------------------------
Class C 1,767,625 28,826,767
---------------------------
Issued as reinvestment of
dividends:
Class A 9,847 156,574
--------------------------------------------------------
Class B 3 46
--------------------------------------------------------
Class C 71 1,122
--------------------------------------------------------
Reacquired:
Class A (619,207) (9,613,757)
--------------------------------------------------------
Class B (49,265) (784,917)
--------------------------------------------------------
Class C (1,630,166) (25,715,783)
--------------------------------------------------------
1,541,425 $ 26,200,119
========================================================
</TABLE>
16
<PAGE> 19
NOTE 8-FINANCIAL HIGHLIGHTS
The following schedule presents financial highlights for a share of the Fund
outstanding throughout the periods indicated.
<TABLE>
<CAPTION>
CLASS A(a)
------------------------------------------------------------------------
SEVEN MONTHS SIX MONTHS
ENDED ENDED JUNE 30, YEAR ENDED DECEMBER 31,
JULY 31, 2000 ------------------------------
2000(b) (UNAUDITED) 1999 1998 1997(b)
------------------ ---------------- ------- ------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 19.92 $ 19.92 $ 16.57 $ 14.99 $13.42
------------------------------------------------------- ------- ------- ------- ------- ------
Income from investment operations:
Net investment income 0.08 0.09 0.13 0.09 0.17
------------------------------------------------------- ------- ------- ------- ------- ------
Net gains (losses) on securities (both realized and
unrealized) (1.22) (0.63) 3.57 1.59 1.69
------------------------------------------------------- ------- ------- ------- ------- ------
Total from investment operations (1.14) (0.54) 3.70 1.68 1.86
------------------------------------------------------- ------- ------- ------- ------- ------
Less distributions:
Dividends from net investment income -- -- (0.28) (0.10) (0.07)
------------------------------------------------------- ------- ------- ------- ------- ------
Distributions from net realized gains -- -- (0.07) -- (0.22)
------------------------------------------------------- ------- ------- ------- ------- ------
Total distributions -- -- (0.35) (0.10) (0.29)
------------------------------------------------------- ------- ------- ------- ------- ------
Net asset value, end of period $ 18.78 $ 19.38 $ 19.92 $ 16.57 $14.99
======================================================= ======= ======= ======= ======= ======
Total return(c) (5.72)% (2.71)% 22.54% 11.20% 13.84%
======================================================= ======= ======= ======= ======= ======
Ratios/supplemental data:
Net assets, end of period (000s omitted) $30,153 $33,022 $31,412 $28,281 $8,444
======================================================= ======= ======= ======= ======= ======
Ratio of expenses to average net assets:
With fee waivers 1.54%(d) 1.50%(d) 1.51% 1.57% 1.71%
------------------------------------------------------- ------- ------- ------- ------- ------
Without fee waivers 1.64%(d) 1.60%(d) 1.72% 1.81% 1.81%
======================================================= ======= ======= ======= ======= ======
Ratio of net investment income to average net assets 0.70%(d) 0.81%(d) 0.71% 0.84% 0.83%
======================================================= ======= ======= ======= ======= ======
Portfolio turnover rate 18% 16% 24% 9% 9%
======================================================= ======= ======= ======= ======= ======
</TABLE>
(a) Per share information and shares have been restated to reflect a 4 for 1
stock split, effected in the form of a 300% stock dividend, on November 7,
1997.
(b) Calculated using average shares outstanding.
(c) Does not deduct sales charges and is not annualized for periods less than
one year.
(d) Ratios are annualized and based on average net assets of $32,197,026 and
$32,273,673 for July 31, 2000 and June 30, 2000, respectively.
17
<PAGE> 20
NOTE 8-FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
CLASS B
-----------------------------------------------------------------------
MARCH 3, 1998
SIX MONTHS ENDED (DATE SALES
SEVEN MONTHS ENDED JUNE 30, YEAR ENDED COMMENCED) TO
JULY 31, 2000(a) DECEMBER 31, DECEMBER 31,
2000(a) (UNAUDITED) 1999 1998
------------------ ---------------- ------------ -------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $19.81 $19.81 $16.48 $16.21
-------------------------------------------------------- ------ ------ ------ ------
Income from investment operations:
Net investment income (loss) (0.01) -- (0.01) --
-------------------------------------------------------- ------ ------ ------ ------
Net gains (losses) on securities (both realized and
unrealized) (1.21) (0.61) 3.56 0.27
-------------------------------------------------------- ------ ------ ------ ------
Total from investment operations (1.22) (0.61) 3.55 0.27
-------------------------------------------------------- ------ ------ ------ ------
Less distributions:
Dividends from net investment income -- -- (0.15) --
-------------------------------------------------------- ------ ------ ------ ------
Distributions from net realized gains -- -- (0.07) --
-------------------------------------------------------- ------ ------ ------ ------
Total distributions -- -- (0.22) --
-------------------------------------------------------- ------ ------ ------ ------
Net asset value, end of period $18.59 $19.20 $19.81 $16.48
======================================================== ====== ====== ====== ======
Total return(b) (6.16)% (3.08)% 21.70% 1.67%
======================================================== ====== ====== ====== ======
Ratios/supplemental data:
Net assets, end of period (000s omitted) $5,883 $5,951 $5,642 $4,289
======================================================== ====== ====== ====== ======
Ratio of expenses to average net assets:
With fee waivers 2.32%(c) 2.28%(c) 2.27% 2.32%(d)
-------------------------------------------------------- ------ ------ ------ ------
Without fee waivers 2.32%(c) 2.28%(c) 2.38% 2.46%(d)
======================================================== ====== ====== ====== ======
Ratio of net investment income (loss) to average net
assets (0.08)%(c) 0.04%(c) (0.05)% 0.09%(d)
======================================================== ====== ====== ====== ======
Portfolio turnover rate 18% 16% 24% 9%
======================================================== ====== ====== ====== ======
</TABLE>
(a) Calculated using average shares outstanding.
(b) Does not deduct contingent deferred sales charges and is not annualized for
periods less than one year.
(c) Ratios are annualized and based on average net assets of $5,664,168 and
$5,618,770 for July 31, 2000 and June 30, 2000, respectively.
(d) Annualized.
<TABLE>
<CAPTION>
CLASS C(a)
-----------------------------------------------------------------------------------------------------
MAY 1, 1995
SIX MONTHS ENDED (DATE SALES
SEVEN MONTHS ENDED JUNE 30, YEAR ENDED DECEMBER 31, COMMENCED) TO
JULY 31, 2000(b) ------------------------------------------- DECEMBER 31,
2000(b) (UNAUDITED) 1999(b) 1998 1997(b) 1996 1995
------------------ ---------------- -------- -------- -------- ------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning
of period $ 19.80 $ 19.80 $ 16.48 $ 14.93 $ 13.42 $ 11.13 $10.00
--------------------------- ------- ------- -------- -------- ------- ------- ------
Income from investment
operations:
Net investment income
(loss) (0.01) -- (0.01) -- 0.01 (0.01) --
--------------------------- ------- ------- -------- -------- ------- ------- ------
Net gains (losses) on
securities (both
realized and unrealized) (1.21) (0.61) 3.55 1.55 1.73 2.34 1.13
--------------------------- ------- ------- -------- -------- ------- ------- ------
Total from investment
operations (1.22) (0.61) 3.54 1.55 1.74 2.33 1.13
--------------------------- ------- ------- -------- -------- ------- ------- ------
Less distributions:
Dividends from net
investment income -- -- (0.15) -- (0.01) -- --
--------------------------- ------- ------- -------- -------- ------- ------- ------
Distributions from net
realized gains -- -- (0.07) -- (0.22) (0.04) --
--------------------------- ------- ------- -------- -------- ------- ------- ------
Total distributions -- -- (0.22) -- (0.23) (0.04) --
--------------------------- ------- ------- -------- -------- ------- ------- ------
Net asset value, end of
period $ 18.58 $ 19.19 $ 19.80 $ 16.48 $ 14.93 $ 13.42 $11.13
=========================== ======= ======= ======== ======== ======= ======= ======
Total return(c) (6.16)% (3.08)% 21.64% 10.38% 12.98% 20.99% 11.28%
=========================== ======= ======= ======== ======== ======= ======= ======
Ratios/supplemental data:
Net assets, end of period
(000s omitted) $89,084 $92,928 $108,821 $105,083 $93,162 $51,916 $9,467
=========================== ======= ======= ======== ======== ======= ======= ======
Ratio of expenses to
average net assets:
With fee waivers 2.32%(d) 2.28%(d) 2.27% 2.32% 2.46% 2.50% 2.50%(e)
--------------------------- ------- ------- -------- -------- ------- ------- ------
Without fee waivers 2.32%(d) 2.28%(d) 2.38% 2.46% 2.46% 2.50% 2.50%(e)
=========================== ======= ======= ======== ======== ======= ======= ======
Ratio of net investment
income (loss) to average
net assets (0.08)%(d) 0.04%(d) (0.05)% 0.09% 0.08% (0.16)% 0.03%(e)
=========================== ======= ======= ======== ======== ======= ======= ======
Portfolio turnover rate 18% 16% 24% 9% 9% 5% 2%
=========================== ======= ======= ======== ======== ======= ======= ======
</TABLE>
(a) Per share information and shares have been restated to reflect a 4 for 1
stock split, effected in the form of a 300% stock dividend, on November 7,
1997.
(b) Calculated using average shares outstanding.
(c) Does not deduct contingent deferred sales charges and is not annualized for
periods less than one year.
(d) Ratios are annualized and based on average net assets of $95,002,106 and
$95,536,491 for July 31, 2000 and June 30, 2000, respectively.
(e) Annualized.
18
<PAGE> 21
INDEPENDENT AUDITORS' REPORT
The Board of Directors and Shareholders of
AIM Advisor International Value Fund:
We have audited the accompanying statement of assets and liabilities of AIM
Advisor International Value Fund (a portfolio of AIM Advisor Funds, Inc.)
including the schedule of investments, as of July 31, 2000, and the related
statement of operations for the seven months ended July 31, 2000 and the year
ended December 31, 1999, the statement of changes in net assets for the seven
months ended July 31, 2000 and the two-years ended December 31, 1999, and the
financial highlights for the seven months ended July 31, 2000 and for each of
the years in the two-year period ended December 31, 1999. These financial
statements and financial highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion on these financial
statements and the financial highlights based on our audits.
We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation of
securities owned as of July 31, 2000, by correspondence with the custodian and
brokers. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of AIM
Advisor International Value Fund as of July 31, 2000, the results of its
operations for the seven months ended July 31, 2000 and the year ended December
31, 1999, the changes in its net assets for the seven months ended July 31, 2000
and the two-years ended December 31, 1999, and the financial highlights for the
seven months ended July 31, 2000 and for each of the years in the two-year
period ended December 31, 1999, in conformity with accounting principles
generally accepted in the United States of America.
/s/ KPMG LLP
September 1, 2000
Houston, Texas
19
<PAGE> 22
<TABLE>
<S> <C> <C>
BOARD OF DIRECTORS OFFICERS OFFICE OF THE FUND
11 Greenway Plaza
Charles T. Bauer Charles T. Bauer Suite 100
Director and Chairman Chairman Houston, TX 77046
A I M Management Group Inc.
Robert H. Graham INVESTMENT ADVISOR
Bruce L. Crockett President A I M Advisors, Inc.
Director 11 Greenway Plaza
ACE Limited; Carol F. Relihan Suite 100
Formerly Director, President, and Senior Vice President and Houston, TX 77046
Chief Executive Officer Secretary
COMSAT Corporation SUB-ADVISOR
Gary T. Crum INVESCO Global Asset Management Limited
Owen Daly II Senior Vice President 12 Bermudian Rd., 3rd Floor
Formerly Director P.O. Box HM66
Cortland Trust Inc. Dana R. Sutton Hamilton, HM, AX, Bermuda
Vice President and Treasurer
Edward K. Dunn Jr. TRANSFER AGENT
Chairman, Mercantile Mortgage Corp.; Robert G. Alley A I M Fund Services, Inc.
Formerly Vice Chairman, President Vice President P.O. Box 4739
and Chief Operating Officer, Houston, TX 77210-4739
Mercantile-Safe Deposit & Trust Co.; and Stuart W. Coco
President, Mercantile Bankshares Vice President CUSTODIAN
State Street Bank and Trust Company
Jack Fields Melville B. Cox 225 Franklin Street
Chief Executive Officer Vice President Boston, MA 02110
Texana Global, Inc. and
Twenty First Century Group, Inc.; Karen Dunn Kelley COUNSEL TO THE FUND
Formerly Member Vice President Ballard Spahr
of the U.S. House of Representatives Andrews & Ingersoll, LLP
Edgar M. Larsen 1735 Market Street
Carl Frischling Vice President Philadelphia, PA 19103
Partner
Kramer, Levin, Naftalis & Frankel LLP Mary J. Benson COUNSEL TO THE TRUSTEES
Assistant Vice President and Kramer, Levin, Naftalis & Frankel LLP
Robert H. Graham Assistant Treasurer 919 Third Avenue
Director, President and New York, NY 10022
Chief Executive Officer Sheri Morris
A I M Management Group Inc. Assistant Vice President and DISTRIBUTOR
Assistant Treasurer A I M Distributors, Inc.
Prema Mathai-Davis 11 Greenway Plaza
Formerly, Chief Executive Officer, Renee A. Friedli Suite 100
YWCA of the U.S.A. Assistant Secretary Houston, TX 77046
Lewis F. Pennock P. Michelle Grace AUDITORS
Attorney Assistant Secretary KPMG LLP
700 Louisiana
Louis S. Sklar Nancy L. Martin Houston, TX 77002
Executive Vice President, Development and Assistant Secretary
Operations, Hines Interests
Limited Partnership Ofelia M. Mayo
Assistant Secretary
Lisa A. Moss
Assistant Secretary
Kathleen J. Pflueger
Assistant Secretary
</TABLE>
REQUIRED FEDERAL INCOME TAX INFORMATION (UNAUDITED)
For the fiscal period ended July 31, 2000, the amount of income received by
AIM Advisor International Value Fund from sources within foreign countries and
possessions of the United States was $0.2904 per share (representing a total of
$1,950,698). The amount of taxes paid by the Fund to such countries for the
fiscal period ended July 31, 2000 was $0.0412 per share (representing a total of
$277,017). The following table provides a breakdown by country of ordinary
income dividends and foreign taxes paid by the Fund during the fiscal period
ended July 31, 2000.
<TABLE>
<CAPTION>
GROSS FOREIGN
INCOME TAX PAID
COUNTRY % %
------- ------ --------
<S> <C> <C>
Australia 4.84% 0.11%
-----------------------------------------------------
Canada 0.12% 0.13%
-----------------------------------------------------
Denmark 0.78% 1.41%
-----------------------------------------------------
France 10.00% 10.63%
-----------------------------------------------------
Germany 12.20% 23.42%
-----------------------------------------------------
Italy 11.58% 11.63%
-----------------------------------------------------
Japan 3.86% 4.20%
-----------------------------------------------------
Mexico 0.56% 0.28%
-----------------------------------------------------
Netherlands 9.24% 15.20%
-----------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
GROSS FOREIGN
INCOME TAX PAID
COUNTRY % %
------- ------ --------
<S> <C> <C>
Portugal 2.32% 2.11%
-----------------------------------------------------
Spain 6.67% 6.82%
-----------------------------------------------------
Switzerland 5.09% 5.54%
-----------------------------------------------------
United Kingdom 27.79% 14.48%
-----------------------------------------------------
Various 2.02% 4.04%
-----------------------------------------------------
Subtotal 97.07% 100.00%
-----------------------------------------------------
United States 2.93% 0.00%
-----------------------------------------------------
Total 100.00% 100.00%
=====================================================
</TABLE>
20
<PAGE> 23
OUR AUTOMATED
AIM INVESTOR LINE,
800-246-5463,
PROVIDES CURRENT ACCOUNT
INFORMATION AND THE PRICE,
YIELD AND TOTAL RETURN ON
ALL AIM FUNDS 24 HOURS A
DAY. YOU CAN ALSO ORDER A
YEAR-TO-DATE STATEMENT OF
YOUR ACCOUNT.
------------------------------------
AIM FUNDS--Registered Trademark-- MAKES INVESTING EASY
o AIM BANK CONNECTION(SM). You can invest in your AIM account in amounts from
$50 to $100,000 without writing a check. Once you set up this convenient
feature, AIM will draw the funds from your pre-authorized checking account
at your request.
o AIM INTERNET CONNECT(SM). Sign up for this service and you can buy, redeem
or exchange shares of AIM funds in your AIM account simply by visiting our
Web site at www.aimfunds.com. For a retirement account, such as an IRA or a
403(b), only exchanges are allowed over the Internet because of the
tax-reporting and record-keeping requirements these accounts involve.
o AUTOMATIC REINVESTMENT OF DIVIDENDS AND/OR CAPITAL GAINS. You can receive
distributions in cash, or you can reinvest them in your account without
paying a sales charge. Over time, the power of compounding can significantly
increase the value of your account.
o AUTOMATIC INVESTMENT PLAN. You can add to your account by authorizing your
AIM fund to withdraw a specified amount, minimum $50, from your bank account
on a regular schedule.
o EASY ACCESS TO YOUR MONEY. You can redeem shares of your AIM fund any day
the New York Stock Exchange is open. The value of the shares may be more or
less than their original cost depending on market conditions.
o EXCHANGE PRIVILEGE. As your investment goals change, you may exchange part
or all of your shares of one fund for shares of a different AIM fund within
the same share class. You may make up to 10 such exchanges per calendar
year.
o TAX-ADVANTAGED RETIREMENT PLANS. You can enjoy the tax advantages offered by
a variety of investment plans, including Traditional IRAs, Roth IRAs and
education IRAs, among others.
o E-MAIL ACCESS. You can contact us at [email protected] for general
information. For account information, contact us at
[email protected].
o www.aimfunds.com. Our award-winning Web site provides account information,
shareholder education and fund-performance information.
<PAGE> 24
THE AIM FAMILY OF FUNDS--Registered Trademark--
<TABLE>
<S> <C> <C>
EQUITY FUNDS
DOMESTIC EQUITY FUNDS INTERNATIONAL/GLOBAL EQUITY FUNDS
MORE AGGRESSIVE MORE AGGRESSIVE A I M Management Group Inc. has provided
leadership in the mutual fund industry
AIM Small Cap Opportunities(1) AIM Latin American Growth since 1976 and managed approximately
AIM Mid Cap Opportunities(2) AIM Developing Markets $176 billion in assets for more than 8
AIM Large Cap Opportunities(6) AIM European Small Company million shareholders, including
AIM Emerging Growth AIM Asian Growth individual investors, corporate clients
AIM Small Cap Growth(3) AIM Japan Growth and financial institutions, as of June
AIM Aggressive Growth AIM International Emerging Growth 30, 2000.
AIM Mid Cap Growth AIM European Development The AIM Family of Funds--Registered
AIM Small Cap Equity AIM Euroland Growth Trademark-- is distributed nationwide,
AIM Capital Development AIM Global Aggressive Growth and AIM today is the eighth-largest
AIM Constellation(4) AIM International Equity mutual fund complex in the United
AIM Dent Demographic Trends AIM Advisor International Value States in assets under management,
AIM Select Growth AIM Global Trends according to Strategic Insight, an
AIM Large Cap Growth AIM Global Growth independent mutual fund monitor.
AIM Weingarten AIM is a subsidiary of AMVESCAP PLC,
AIM Mid Cap Equity MORE CONSERVATIVE one of the world's largest independent
AIM Value II financial services companies with $389
AIM Charter SECTOR EQUITY FUNDS billion in assets under management as of
AIM Value June 30, 2000.
AIM Blue Chip MORE AGGRESSIVE
AIM Basic Value
AIM Large Cap Basic Value AIM New Technology
AIM Balanced AIM Global Telecommunications and Technology
AIM Advisor Flex AIM Global Resources
AIM Global Financial Services
MORE CONSERVATIVE AIM Global Health Care
AIM Global Consumer Products and Services
AIM Global Infrastructure
AIM Advisor Real Estate
AIM Global Utilities
MORE CONSERVATIVE
FIXED-INCOME FUNDS
TAXABLE FIXED-INCOME FUNDS TAX-FREE FIXED-INCOME FUNDS
MORE AGGRESSIVE MORE AGGRESSIVE
AIM Strategic Income AIM High Income Municipal
AIM High Yield II AIM Tax-Exempt Bond of Connecticut
AIM High Yield AIM Municipal Bond
AIM Income AIM Tax-Free Intermediate
AIM Global Income AIM Tax-Exempt Cash
AIM Floating Rate(5)
AIM Intermediate Government MORE CONSERVATIVE
AIM Limited Maturity Treasury
AIM Money Market
MORE CONSERVATIVE
</TABLE>
The AIM Risk Spectrum illustrates equity and fixed-income funds from more
aggressive to more conservative. When assessing the degree of risk, three
factors were considered: the funds' portfolio holdings, volatility patterns over
time and diversification permitted within the fund. Fund rankings are relative
to one another within The AIM Family of Funds--Registered Trademark-- and should
not be compared with other investments. There is no guarantee that any one AIM
fund will be less volatile than any other. (1) AIM Small Cap Opportunities Fund
closed to new investors Nov. 4, 1999. (2) AIM Mid Cap Opportunities Fund closed
to new investors March 21, 2000. (3) AIM Small Cap Growth Fund closed to new
investors Nov. 8, 1999. (4) AIM Constellation Fund's investment strategy
broadened to allow investments across all market capitalizations Dec. 1, 1999.
(5) AIM Floating Rate Fund was restructured to offer multiple share classes
April 3, 2000. Existing shares were converted to Class B shares, and Class C
shares commenced offering. (6) AIM Large Cap Opportunities Fund will close to
new investors Sept. 29, 2000, or when the fund reaches a total net asset value
of $750 million, whichever occurs first.
FOR MORE COMPLETE INFORMATION ABOUT ANY AIM FUND, INCLUDING SALES CHARGES
AND EXPENSES, OBTAIN THE APPROPRIATE PROSPECTUS(ES) FROM YOUR FINANCIAL ADVISOR.
PLEASE READ THE PROSPECTUS(ES) CAREFULLY BEFORE YOU INVEST OR SEND MONEY. This
report is not authorized for distribution to prospective investors unless
preceded or accompanied by a currently effective fund prospectus. If used as
sales material after Oct. 20, 2000, this report must be accompanied by a fund
Performance & Commentary or by an AIM Quarterly Review of Performance for the
most recent quarter end.
[DALBAR LOGO APPEARS HERE] [AIM LOGO APPEARS HERE]
--Registered Trademark--
[INVEST WITH DISCIPLINE]
--Registered Trademark--
A I M Distributors, Inc. IVAL-AR-1
