<PAGE> 1
ANNUAL REPORT / DECEMBER 31 1999
AIM ADVISOR LARGE CAP VALUE FUND
[COVER IMAGE]
[AIM LOGO APPEARS HERE]
<PAGE> 2
[COVER IMAGE]
-------------------------------------
WALL STREET TO TRINITY CHURCH (1993, SERIES)
BY BEAU REDMOND, LIVING AMERICAN
WHILE VISITING NEW YORK IN 1980, THE ARTIST WANTED TO SKETCH
A WALL STREET SCENE BUT DID NOT HAVE ANY DRAWING PAPER, SO HE
USED WHAT HE DID HAVE, A PAGE FROM THE WALL STREET JOURNAL.
THEN, INSTEAD OF TRANSFERRING THE SKETCH TO CANVAS, HE PAINTED
ON THE NEWSPAPER PAGE, CREATING AN EVOCATIVE MEDIUM THAT
WOULD LEAD TO PAINTINGS SUCH AS THIS ONE. THIS PIECE CALLS TO
MIND THE INDELIBLE LINK BETWEEN WALL STREET AND THE STOCK
MARKET, WHERE LARGE-CAP COMPANIES ARE A MAJOR DRIVING FORCE.
-------------------------------------
AIM Advisor Large Cap Value Fund is for shareholders who seek a high total
return on investment through growth of capital and current income, without
regard to federal income tax considerations.
ABOUT FUND PERFORMANCE AND PORTFOLIO DATA THROUGHOUT THIS REPORT:
o AIM Advisor Large Cap Value Fund's performance figures are historical, and
they reflect changes in net asset value and the reinvestment of
distributions.
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 Class A shares due to different sales-charge structure and expenses.
o During the fiscal year ended 12/31/99, the fund paid distributions of
$3.2380 per share for Class A shares and $3.0645 per share for Class B and
Class C shares.
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 Russell 1000 Growth Index measures the performance of those Russell 1000
companies with higher price-to-book ratios and higher forecasted growth
values.
o The Russell 1000 Value Index measures the performance of those Russell 1000
companies with lower price-to-book ratios and lower forecasted growth
values.
o The unmanaged Standard & Poor's Composite Index of 500 Stocks (the S&P 500)
is generally considered representative of the stock market in general.
o An investment cannot be made in an index. Unless otherwise indicated, index
results include reinvested dividends and 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 LARGE CAP VALUE FUND
<PAGE> 3
ANNUAL REPORT / CHAIRMAN'S LETTER
Dear Fellow Shareholder:
The fiscal year discussed in this report has reconfirmed our
[PHOTO OF faith in two long-established principles of investing:
Charles T. portfolio diversification and long-term thinking. We could
Bauer, title this report "What a Difference a Year Makes."
Chairman of An investor surveying conditions when the fiscal year
the Board of opened on January 1, 1999, would have seen a market
THE FUND dominated by large-capitalization stocks and high-quality
APPEARS HERE] bonds, especially U.S. Treasuries. During 1998, two
well-known indexes of large-capitalization U.S. companies,
the S&P 500 and the Dow Jones Industrial Average, were up
28.60% and 18.15%, respectively. By contrast,
smaller-company stocks in the Russell 2000 had lost 2.55%.
Overseas, many markets were languishing, especially in Asia,
where so many financial difficulties had originated in 1997.
In bond markets as well, name-brand quality was the
place to be. The Lehman Government/Corporate Bond Index,
which follows sovereign issues and investment-grade debt, was up 9.47%, while
the Lehman High Yield Index, which tracks riskier "junk bonds," had risen only
1.60%.
It would be easy for an investor to conclude that blue-chip issues, whether
equity or fixed-income, were the place to be, that it was time to divest himself
of everything else and put all his eggs in the blue-chip basket. The investor,
of course, would be wrong.
MARKETS TURN
While large-capitalization stocks continued to do very well, during 1999 markets
broadened dramatically with many investment sectors performing a complete
turnaround. For example, the small-cap stocks in the Russell 2000 were up 21.26%
for calendar year 1999, and many Asian markets, particularly Japan, had staged a
comeback.
The same holds true of bonds. The higher-quality Lehman index was down 2.15%
during 1999 while the Lehman High Yield index was up 2.39%.
The point, at the risk of sounding repetitive to those of you who have
invested with us for a long time, is that this is why diversification is a
fundamental investing principle. Market sectors and asset classes go in and out
of favor, but over the long run--and the long run is several years--the markets'
overall trend has been upward. Selecting an asset class or a market sector on
the basis of a short-term snapshot of conditions is usually unwise, as is
concentrating your portfolio in one asset class. Staying fully invested in a
diversified portfolio remains a compelling strategy and one of your best
prospects for long-term gain. We also continue to remind you that the past few
years have seen extraordinary gains in some markets, and there is no assurance
that this trend will continue.
LOOKING AHEAD
As we look about at the close of this fiscal year, we are encouraged by multiple
signs of economic health in Europe and Asia, not to mention the prolonged U.S.
economic expansion. However, we are aware of how easily an investor could have
been misled by conditions just 12 months ago. For our shareholders, we therefore
reiterate our commitment to investing through a financial advisor. In addition
to helping you select investments appropriate to your time horizon and risk
tolerance, a financial advisor can keep you informed about how changing market
conditions affect you and your portfolio--and help ensure that when you do alter
your investments, there's a logical reason for doing so. AIM believes every
investor should be guided by a financial professional.
FUND MANAGERS COMMENT
In the pages that follow, your fund's portfolio managers discuss how they
managed your fund during the year ended December 31, how the markets behaved and
what they foresee for the near future. We trust you will find their discussion
informative. If you have any questions or comments, we invite you to contact us,
either at our Web site, aimfunds.com, or through our Client Services department
at 800-959-4246. Information about your account is also available through our
automated AIM Investor Line, 800-246-5463.
Thank you for your continued participation in The AIM Family of
Funds--Registered Trademark--.
Sincerely,
/s/ CHARLES T. BAUER
Charles T. Bauer
Chairman, A I M Advisors, Inc.
-------------------------------------
STAYING FULLY
INVESTED IN A DIVERSIFIED
PORTFOLIO REMAINS
A COMPELLING STRATEGY
AND ONE OF YOUR
BEST PROSPECTS FOR
LONG-TERM GAIN.
-------------------------------------
AIM ADVISOR LARGE CAP VALUE FUND
<PAGE> 4
ANNUAL REPORT / MANAGERS' OVERVIEW
RESURGENT MARKET TIDE DOESN'T LIFT
ALL BOATS
HOW DID AIM ADVISOR LARGE CAP VALUE FUND PERFORM DURING THE REPORTING PERIOD?
The narrowness of equity markets coupled with the pullback of value-type stocks
led to rather lackluster performance for AIM Advisor Large Cap Value Fund.
For the fiscal year ended December 31, 1999, the fund had total returns of
- -0.01% for Class A shares, -0.75% for Class B shares and -0.71% for Class C
shares. (These returns are at net asset value, which does not include sales
charges.) Comparatively, the S&P 500 Index had a return of 21.03% for the
reporting period, while the Russell 1000 Value Index finished the year with a
return of 7.35%.
WHAT WAS THE MARKET ENVIRONMENT LIKE DURING 1999?
With the worst of the global financial crisis past, the question throughout
much of 1999 was whether or not the Federal Reserve Board (the Fed) would need
to raise interest rates to forestall inflation. Inflation fears spawned
volatility in the markets, curbing high-flying technology, communications and
financial stocks in the spring and bringing on a resurgence of more cyclical
stocks, like energy and commodities.
By midsummer, major stock indexes reached record highs, lifted by solid
corporate earnings, continued tame inflation and renewed vitality among tech
stocks. But investors' fears again dampened stocks as key economic indicators
showed that the economy blazed ahead relentlessly. Ultimately, in three separate
moves, the Fed raised the key federal funds rate from 4.75% to 5.50%.
Despite persistent inflation fears, the U.S. economy continued to experience
a near-record level of consumer confidence. Markets reached a fever pitch by the
end of 1999, with some indexes again reaching new highs by the close of the
year. How-ever, these record-breaking performances masked a rather narrow
market--although the S&P 500 returned 14.9% for the fourth quarter, the average
stock in the index was up only 8.2% for the same period.
HOW DID THE MARKET ENVIRONMENT AFFECT THE FUND'S PERFORMANCE?
The shift to cyclical stocks during the second quarter of the year boosted the
fund's performance. But the narrowing of the market as the year went on proved
unfavorable for the fund because much of the market's run-up occurred in the
technology sector, in which the fund was underweight relative to the S&P 500
(17.14% vs. 28.4%). The fund also had a higher weighting in financials than the
index (18.32% vs. 13.2%), and many of these stocks were negatively affected by
persistent inflation fears in the market.
Further, even though value staged a comeback early in 1999, growth again
widely outperformed value for the year, with the Russell 1000 Growth Index up
33.16%, compared to the Russell 1000 Value Index's 7.35% return for the 12-month
period. The fund's value orienta-
PORTFOLIO COMPOSITION
As of 12/31/99, based on total net assets
<TABLE>
<CAPTION>
==========================================================================================================
TOP 10 HOLDINGS TOP 10 INDUSTRIES
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. General Electric Co. 2.99% 1. Computers (Software & Services) 7.76%
2. Bell Atlantic Corp. 2.68 2. Financial (Diversified) 6.76
3. Exxon-Mobil Corp. 2.55 3. Telephone 6.20
4. Lowe's Companies, Inc. 2.44 4. Computers (Hardware) 5.64
5. Computer Associates International, Inc. 2.43 5. Oil (International Integrated) 5.64
6. MCI WorldCom, Inc. 2.34 6. Manufacturing (Diversified) 5.29
7. American General Corp. 2.29 7. Banks (Money Center) 4.30
8. Intel Corp. 2.02 8. Health Care (Diversified) 3.93
9. Schering-Plough Corp. 1.87 9. Electrical Equipment 3.75
10. Citigroup Inc. 1.86 10. Health Care (Drugs-Major Pharmaceuticals) 3.53
The fund's portfolio is subject to change, and there is no assurance that the
fund will continue to hold any particular security.
==========================================================================================================
</TABLE>
[ARTWORK] -------------------------------------
GROWTH AGAIN WIDELY OUTPERFORMED
VALUE FOR THE YEAR.
-------------------------------------
See important fund and index disclosures inside front cover.
AIM ADVISOR LARGE CAP VALUE FUND
2
<PAGE> 5
ANNUAL REPORT / MANAGERS' OVERVIEW
tion naturally made it susceptible to the effects of this outperformance;
according to Morningstar Inc., a company that tracks mutual fund performance,
the average large growth fund was up 39% for the year, compared to the average
large value fund's return of 6% for the year.
WHY WAS THE FUND UNDERWEIGHT IN TECHNOLOGY?
Our investment discipline dictates that we evaluate each company's historical
profitability relative to its current price, regardless of market sector.
Technology now accounts for nearly 30% of the stocks in the S&P 500, making the
index less diversified than in the past. Many technology stocks spiked during
the fourth quarter of the year, generally appearing very overvalued, which means
they did not fit in with the fund's high-quality, value bias.
While the fund does have a heavier technology weighting than it did a year
ago (17.14% vs. 12.2%), we have been reducing positions in some of our tech
holdings to keep the fund within its value-oriented parameters. One tech holding
that has benefited the fund is Computer Associates International, an independent
software company that likens its products to the plumbing under a sink rather
than the fancy faucet on top.
WHY DID FINANCIAL STOCKS HAVE SUCH A DIFFICULT YEAR?
Financial stocks tend to be more sensitive to interest rates than other stocks
do, so when investors' inflation fears were at their peak, financial stocks bore
the brunt of the market decline. The financials component of the S&P 500
finished with a return of only 3.97% for the year, which means that the fund's
overweighting in financials did not bode well for its performance. However, we
believe there is reason to be optimistic about financial stocks in the coming
year. (See sidebar.)
Even with the downturn in financial stocks, Citigroup, one of the world's
largest financial-services companies and a fund holding, has bounced back
substantially since 1998's global financial crisis eroded its stock along with
that of many other financial companies.
HOW DID YOUR HEALTH-CARE HOLDINGS PERFORM?
In the current market, any hint that revenues will be light or that earnings
will miss the consensus number is extremely detrimental to the stock price.
Several of our health-care stocks, including American Home Products (AHP),
experienced earnings disappointments this year and thus were punished quite
severely. While we have trimmed our position in AHP, it is still a fund holding
because the company has a good drug pipeline and strong performance from
several new drugs, among them the estrogen-replacement drug Premarin.
WHAT IS YOUR OUTLOOK FOR THE NEAR TERM?
The fundamentals for a continued favorable equity environment--solid economic
growth and low inflation--appear to be in place for the coming year. That said,
many analysts believe that the Fed will need to raise interest rates at least
once--if not more--to slow economic growth to a more sustainable pace. It seems
the same story that dogged markets in 1999 is so far continuing, with persistent
upward pressure on interest rates.
The good news is that the divergence in both performance and valuation in
stocks has created an opportunity to add quality names to the portfolio at
cheaper prices. We will continue to focus on high- quality value stocks for the
portfolio regardless of market trends.
THE BENEFITS OF FINANCIAL REFORM
Congress voted on November 4, 1999 to reform the Glass-Steagall Act, created
during the Great Depression to separate commercial and investment banking. Some
analysts believe this reform could set off a flurry of merger-and-acquisition
(M&A) activity among U.S. banks, insurance companies, investment managers and
brokers.
If structural deregulation does prompt M&A activity, less efficient firms
could be seized by larger companies and streamlined by cutting costs. More M&A
activity could also mean more competition among financial companies as they
delve into previously untried areas. Banks may be particularly well poised
because so many of them are diversifying into fee-based money management and
services, areas that are far less sensitive to interest rates than traditional
lending.
Increased competition may also mean savings for consumers who tend to shop
product by product rather than sticking with a single brand. With broader
product lines, financial companies will be competing for many of the same
customers; they will need to find ways to draw customers in, which can mean more
efficient service and lower prices.
See important fund and index disclosures inside front cover.
AIM ADVISOR LARGE CAP VALUE FUND
3
<PAGE> 6
ANNUAL REPORT / PERFORMANCE HISTORY
YOUR FUND'S LONG-TERM PERFORMANCE
RESULTS OF A $10,000 INVESTMENT
AIM ADVISOR LARGE CAP VALUE FUND VS. BENCHMARK INDEXES
12/31/89-12/31/99
in thousands
================================================================================
AIM Advisor Large
Cap Value Fund, Class Russell 1000
C Shares Value Index S&P 500 Index
- --------------------------------------------------------------------------------
12/89 10,000 10,307
12/90 9,625 9,191 11,067
12/91 12,857 11,453 12,549
12/92 13,479 13,035 14,257
12/93 14,713 15,397 14,456
12/94 15,109 15,091 18,219
12/95 19,684 20,878 22,953
12/96 23,065 25,396 30,913
12/97 30,137 34,332 40,240
12/98 34,099 39,698 49,400
12/99 33,854 42,614 53,204
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.
AVERAGE ANNUAL TOTAL RETURNS
As of 12/31/99, including sales charges
================================================================================
CLASS A SHARES
Inception (12/31/96) 12.37%
1 year -5.52*
*-0.01%, excluding sales charges
CLASS B SHARES
Inception (3/3/98) 1.26%
1 year -5.08*
*-0.75%, excluding CDSC
CLASS C SHARES
Inception (2/15/84) 13.59%
10 years 12.97
5 years 17.51
1 year -1.58*
*-0.71%, excluding CDSC
================================================================================
Your fund's total return includes sales charges, expenses and management fees.
The performance of the fund's Class B and Class C shares will differ from that
of Class A 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.
ABOUT THIS CHART
The chart compares your fund's Class C shares to benchmark indexes. It is
intended to give you an idea of how your fund performed compared to the indexes
over the period 12/31/89-12/31/99. 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 S&P 500 Index or the Russell
1000 Value Index is not managed, incurring no sales charges, expenses or fees.
If you could buy all the securities that make up a market index, you would incur
expenses that would affect your investment's return.
AIM ADVISOR LARGE CAP VALUE FUND
4
<PAGE> 7
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
COMMON STOCKS & OTHER EQUITY
INTERESTS-97.68%
AUTOMOBILES-1.36%
Ford Motor Co. 41,000 $ 2,190,937
- --------------------------------------------------------------
BANKS (MAJOR REGIONAL)-2.39%
FleetBoston Financial Corp. 60,000 2,088,750
- --------------------------------------------------------------
National City Corp. 33,500 793,531
- --------------------------------------------------------------
State Street Corp. 13,200 964,425
- --------------------------------------------------------------
3,846,706
- --------------------------------------------------------------
BANKS (MONEY CENTER)-4.30%
Bank of America Corp. 45,674 2,292,264
- --------------------------------------------------------------
Chase Manhattan Corp. (The) 34,500 2,680,219
- --------------------------------------------------------------
First Union Corp. 60,000 1,968,750
- --------------------------------------------------------------
6,941,233
- --------------------------------------------------------------
BEVERAGES (ALCOHOLIC)-1.46%
Anheuser-Busch Cos, Inc. 33,200 2,353,050
- --------------------------------------------------------------
BROADCASTING (TELEVISION, RADIO &
CABLE)-1.24%
MediaOne Group, Inc. 26,000 1,997,125
- --------------------------------------------------------------
CHEMICALS-1.82%
Dow Chemical Co. (The) 13,200 1,763,850
- --------------------------------------------------------------
Praxair, Inc. 23,300 1,172,281
- --------------------------------------------------------------
2,936,131
- --------------------------------------------------------------
COMMUNICATIONS EQUIPMENT-0.99%
ADC Telecommunications, Inc.(a) 22,000 1,596,375
- --------------------------------------------------------------
COMPUTERS (HARDWARE)-5.64%
Compaq Computer Corp. 36,200 979,662
- --------------------------------------------------------------
Hewlett-Packard Co. 26,200 2,985,162
- --------------------------------------------------------------
International Business Machines
Corp. 25,700 2,775,600
- --------------------------------------------------------------
Sun Microsystems, Inc.(a) 30,500 2,361,844
- --------------------------------------------------------------
9,102,268
- --------------------------------------------------------------
COMPUTERS (SOFTWARE &
SERVICES)-7.76%
Cadence Design Systems, Inc.(a) 65,200 1,564,800
- --------------------------------------------------------------
Computer Associates International,
Inc. 56,000 3,916,500
- --------------------------------------------------------------
Compuware Corp.(a) 54,100 2,015,225
- --------------------------------------------------------------
Microsoft Corp.(a) 17,400 2,031,450
- --------------------------------------------------------------
Oracle Corp.(a) 26,650 2,986,466
- --------------------------------------------------------------
12,514,441
- --------------------------------------------------------------
CONSTRUCTION (CEMENT & AGGREGATES)-1.07%
Vulcan Materials Co. 43,300 1,729,294
- --------------------------------------------------------------
CONSUMER FINANCE-0.98%
Household International, Inc. 42,300 1,575,675
- --------------------------------------------------------------
DISTRIBUTORS (FOOD & HEALTH)-0.51%
SUPERVALU, INC 41,200 824,000
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
ELECTRIC COMPANIES-2.71%
DTE Energy Co. 35,000 $ 1,098,125
- --------------------------------------------------------------
GPU, Inc. 35,000 1,047,812
- --------------------------------------------------------------
Southern Co. (The) 33,200 780,200
- --------------------------------------------------------------
Teco Energy, Inc. 78,000 1,447,875
- --------------------------------------------------------------
4,374,012
- --------------------------------------------------------------
ELECTRICAL EQUIPMENT-3.75%
Emerson Electric Co. 21,200 1,216,350
- --------------------------------------------------------------
General Electric Co. 31,200 4,828,200
- --------------------------------------------------------------
6,044,550
- --------------------------------------------------------------
ELECTRONICS (SEMICONDUCTORS)-2.02%
Intel Corp. 39,600 3,259,575
- --------------------------------------------------------------
FINANCIAL (DIVERSIFIED)-6.76%
American General Corp. 48,600 3,687,525
- --------------------------------------------------------------
Citigroup Inc. 54,000 3,000,375
- --------------------------------------------------------------
Fannie Mae 25,000 1,560,937
- --------------------------------------------------------------
MGIC Investment Corp. 44,000 2,648,250
- --------------------------------------------------------------
10,897,087
- --------------------------------------------------------------
FOODS-0.37%
H.J. Heinz Co. 15,000 597,187
- --------------------------------------------------------------
HEALTH CARE (DIVERSIFIED)-3.93%
Abbott Laboratories 24,500 889,656
- --------------------------------------------------------------
American Home Products Corp. 35,900 1,415,806
- --------------------------------------------------------------
Bristol-Myers Squibb Co. 25,700 1,649,619
- --------------------------------------------------------------
Johnson & Johnson 25,500 2,374,687
- --------------------------------------------------------------
6,329,768
- --------------------------------------------------------------
HEALTH CARE (DRUGS-MAJOR
PHARMACEUTICALS)-3.53%
Merck & Co., Inc. 40,000 2,682,500
- --------------------------------------------------------------
Schering-Plough Corp. 71,400 3,012,187
- --------------------------------------------------------------
5,694,687
- --------------------------------------------------------------
HEALTH CARE (MEDICAL PRODUCTS &
SUPPLIES)-0.58%
Biomet, Inc. 23,500 940,000
- --------------------------------------------------------------
HEALTH CARE (SPECIALIZED
SERVICES)-0.51%
Quintiles Transnational Corp.(a) 44,400 829,725
- --------------------------------------------------------------
HOUSEHOLD FURNISHING &
APPLIANCES-0.65%
Whirlpool Corp. 16,100 1,047,506
- --------------------------------------------------------------
HOUSEHOLD PRODUCTS (NON-DURABLES)-3.02%
Kimberly-Clark Corp. 37,900 2,472,975
- --------------------------------------------------------------
Procter & Gamble, Co. (The) 21,900 2,399,419
- --------------------------------------------------------------
4,872,394
- --------------------------------------------------------------
INSURANCE (LIFE/HEALTH)-1.44%
Jefferson-Pilot Corp. 22,700 1,549,275
- --------------------------------------------------------------
</TABLE>
5
<PAGE> 8
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
INSURANCE (LIFE/HEALTH)-(CONTINUED)
Torchmark Corp. 26,700 $ 775,969
- --------------------------------------------------------------
2,325,244
- --------------------------------------------------------------
INSURANCE (MULTI-LINE)-0.67%
American International Group, Inc. 10,000 1,081,250
- --------------------------------------------------------------
INVESTMENT BANKING/BROKERAGE-1.78%
Morgan Stanley Dean Witter & Co. 20,150 2,876,413
- --------------------------------------------------------------
IRON & STEEL-0.67%
Nucor Corp. 19,600 1,074,325
- --------------------------------------------------------------
LEISURE TIME (PRODUCTS)-0.46%
Mattel, Inc. 56,700 744,188
- --------------------------------------------------------------
MANUFACTURING (DIVERSIFIED)-5.29%
Illinois Tool Works, Inc. 32,677 2,207,740
- --------------------------------------------------------------
Minnesota Mining and Manufacturing
Co. 16,500 1,614,938
- --------------------------------------------------------------
Textron, Inc. 22,400 1,717,800
- --------------------------------------------------------------
Tyco International Ltd. 32,600 1,267,325
- --------------------------------------------------------------
United Technologies Corp. 26,500 1,722,500
- --------------------------------------------------------------
8,530,303
- --------------------------------------------------------------
MANUFACTURING (SPECIALIZED)-0.53%
York International Corp. 30,900 847,819
- --------------------------------------------------------------
OIL (INTERNATIONAL
INTEGRATED)-5.64%
Chevron Corp. 18,100 1,567,913
- --------------------------------------------------------------
Exxon Mobil Corp. 51,000 4,108,688
- --------------------------------------------------------------
Repsol S.A.-ADR (Spain) 41,900 974,175
- --------------------------------------------------------------
Royal Dutch Petroleum Co.-New York
Shares-ADR (Netherlands) 40,400 2,441,675
- --------------------------------------------------------------
9,092,451
- --------------------------------------------------------------
PAPER & FOREST PRODUCTS-1.07%
International Paper Co. 30,700 1,732,631
- --------------------------------------------------------------
PHOTOGRAPHY/IMAGING-0.73%
Xerox Corp. 52,000 1,179,750
- --------------------------------------------------------------
PUBLISHING (NEWSPAPERS)-1.86%
Gannett Co., Inc. 36,700 2,993,344
- --------------------------------------------------------------
RESTAURANTS-1.00%
McDonald's Corp. 40,100 1,616,531
- --------------------------------------------------------------
RETAIL (BUILDING SUPPLIES)-3.29%
Lowe's Cos., Inc. 66,000 3,943,500
- --------------------------------------------------------------
Sherwin-Williams Co. 64,700 1,358,700
- --------------------------------------------------------------
5,302,200
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
RETAIL (DEPARTMENT STORES)-0.56%
Dillards, Inc.-Class A 44,400 $ 896,325
- --------------------------------------------------------------
RETAIL (FOOD CHAINS)-0.81%
Albertson's, Inc. 40,400 1,302,900
- --------------------------------------------------------------
RETAIL (GENERAL MERCHANDISE)-0.74%
Costco Wholesale Corp.(a) 13,000 1,186,250
- --------------------------------------------------------------
RETAIL (SPECIALTY)-0.64%
Office Depot, Inc.(a) 93,700 1,024,844
- --------------------------------------------------------------
SERVICES (DATA PROCESSING)-1.66%
First Data Corp. 54,300 2,677,669
- --------------------------------------------------------------
SPECIALTY PRINTING-0.90%
Deluxe Corp. 53,100 1,456,931
- --------------------------------------------------------------
TELECOMMUNICATIONS (LONG DISTANCE)-3.26%
AT&T Corp. 29,100 1,476,825
- --------------------------------------------------------------
MCI WorldCom, Inc.(a) 71,250 3,780,703
- --------------------------------------------------------------
5,257,528
- --------------------------------------------------------------
TELEPHONE-6.20%
ALLTEL Corp. 10,800 893,025
- --------------------------------------------------------------
Bell Atlantic Corp. 70,100 4,315,531
- --------------------------------------------------------------
SBC Communications, Inc. 54,087 2,636,741
- --------------------------------------------------------------
US West, Inc. 30,000 2,160,000
- --------------------------------------------------------------
10,005,297
- --------------------------------------------------------------
TEXTILES (APPAREL)-0.43%
Liz Claiborne, Inc. 18,300 688,538
- --------------------------------------------------------------
TOBACCO-0.70%
Philip Morris Cos. Inc. 48,500 1,124,594
- --------------------------------------------------------------
Total Common Stocks & Other
Equity Interests (Cost
$113,888,199) 157,511,051
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
<S> <C> <C>
U.S. GOVERNMENT AGENCY
SECURITIES-2.72%
FEDERAL HOME LOAN BANK-2.72%
Disc. Notes,(b)
1.50%, 01/03/00 (Cost $4,385,635) $4,386,000 4,385,635
- --------------------------------------------------------------
TOTAL INVESTMENTS-100.40% (Cost
$118,273,834) 161,896,686
- --------------------------------------------------------------
LIABILITIES LESS OTHER
ASSETS-(0.40%) (640,236)
- --------------------------------------------------------------
NET ASSETS-100.00% $161,256,450
==============================================================
</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.
6
<PAGE> 9
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (cost
$118,273,834) $161,896,686
- ---------------------------------------------------------
Receivables for:
Capital stock sold 128,484
- ---------------------------------------------------------
Interest and dividends 215,784
- ---------------------------------------------------------
Investment for deferred compensation plan 12,597
- ---------------------------------------------------------
Other assets 14,320
- ---------------------------------------------------------
Total assets 162,267,871
- ---------------------------------------------------------
LIABILITIES:
Payables for:
Capital stock reacquired 452,661
- ---------------------------------------------------------
Deferred compensation plan 12,597
- ---------------------------------------------------------
Accrued advisory fees 102,022
- ---------------------------------------------------------
Administrative services fees 4,247
- ---------------------------------------------------------
Accrued distribution fees 372,598
- ---------------------------------------------------------
Accrued transfer agent fees 9,918
- ---------------------------------------------------------
Accrued operating expenses 57,378
- ---------------------------------------------------------
Total liabilities 1,011,421
- ---------------------------------------------------------
NET ASSETS APPLICABLE TO SHARES OUTSTANDING $161,256,450
=========================================================
NET ASSETS:
Class A $ 12,011,184
=========================================================
Class B $ 6,572,901
=========================================================
Class C $142,672,365
=========================================================
CAPITAL STOCK, $0.001 PAR VALUE PER SHARE:
Class A:
Authorized 100,000,000
- ---------------------------------------------------------
Outstanding 549,760
=========================================================
Class B:
Authorized 100,000,000
- ---------------------------------------------------------
Outstanding 302,862
=========================================================
Class C:
Authorized 100,000,000
- ---------------------------------------------------------
Outstanding 6,575,037
=========================================================
Class A:
Net asset value and redemption price per
share $ 21.85
- ---------------------------------------------------------
Offering price per share:
(Net asset value of $21.85 divided by
94.50%) $ 23.12
=========================================================
Class B:
Net asset value and offering price per
share $ 21.70
=========================================================
Class C:
Net asset value and offering price per
share $ 21.70
=========================================================
</TABLE>
See Notes to Financial Statements.
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of $53,387 foreign
withholding tax) $ 3,415,803
- ---------------------------------------------------------
Interest 202,066
- ---------------------------------------------------------
Total investment income 3,617,869
- ---------------------------------------------------------
EXPENSES:
Advisory fees 1,382,625
- ---------------------------------------------------------
Administrative services fees 25,205
- ---------------------------------------------------------
Custodian fees 24,305
- ---------------------------------------------------------
Operating services fees 434,220
- ---------------------------------------------------------
Directors' fees and expenses 4,977
- ---------------------------------------------------------
Distribution fees-Class A 45,980
- ---------------------------------------------------------
Distribution fees-Class B 56,134
- ---------------------------------------------------------
Distribution fees-Class C 1,655,995
- ---------------------------------------------------------
Transfer Agent Fees-Class A 12,763
- ---------------------------------------------------------
Transfer Agent Fees-Class B 1,909
- ---------------------------------------------------------
Transfer Agent Fees-Class C 56,313
- ---------------------------------------------------------
Other 46,418
- ---------------------------------------------------------
Total expenses 3,746,844
- ---------------------------------------------------------
Less: Fees waived (264,083)
- ---------------------------------------------------------
Expenses paid indirectly (1,655)
- ---------------------------------------------------------
Net expenses 3,481,106
- ---------------------------------------------------------
Net investment income 136,763
- ---------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) FROM
INVESTMENT SECURITIES:
Net realized gain from investment
securities 31,241,883
- ---------------------------------------------------------
Change in net unrealized appreciation
(depreciation) of investment securities (33,428,078)
- ---------------------------------------------------------
Net gain (loss) on investment
securities (2,186,195)
- ---------------------------------------------------------
Net increase (decrease) in net assets
resulting from operations $ (2,049,432)
=========================================================
</TABLE>
7
<PAGE> 10
STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
<TABLE>
<CAPTION>
1999 1998
------------ -------------
<S> <C> <C>
OPERATIONS:
Net investment income $ 136,763 $ 383,276
- ------------------------------------------------------------------------------------------
Net realized gain from investment securities 31,241,883 13,666,132
- ------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) of
investment securities (33,428,078) 9,514,639
- ------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations (2,049,432) 23,564,047
- ------------------------------------------------------------------------------------------
Distributions to shareholders from net investment income:
Class A (103,102) (63,186)
- ------------------------------------------------------------------------------------------
Class B (9,281) (4,659)
- ------------------------------------------------------------------------------------------
Class C (252,383) (130,140)
- ------------------------------------------------------------------------------------------
Distributions to shareholders from net realized gains on
investment securities:
Class A (1,495,160) (1,168,568)
- ------------------------------------------------------------------------------------------
Class B (840,484) (558,881)
- ------------------------------------------------------------------------------------------
Class C (17,808,848) (14,182,679)
- ------------------------------------------------------------------------------------------
Share transactions-net:
Class A (2,025,526) 10,506,884
- ------------------------------------------------------------------------------------------
Class B 152,238 7,500,215
- ------------------------------------------------------------------------------------------
Class C (19,999,780) 2,997,348
- ------------------------------------------------------------------------------------------
Net increase (decrease) in net assets (44,431,758) 28,460,381
- ------------------------------------------------------------------------------------------
NET ASSETS:
Beginning of period 205,688,208 177,227,827
- ------------------------------------------------------------------------------------------
End of period $161,256,450 $ 205,688,208
==========================================================================================
NET ASSETS CONSIST OF:
Capital (par value and additional paid-in) $107,291,948 $ 127,632,168
- ------------------------------------------------------------------------------------------
Undistributed net investment income (loss) (19,552) 210,789
- ------------------------------------------------------------------------------------------
Undistributed net realized gain from investment securities 10,361,202 794,321
- ------------------------------------------------------------------------------------------
Unrealized appreciation of investment securities 43,622,852 77,050,930
- ------------------------------------------------------------------------------------------
$161,256,450 $ 205,688,208
==========================================================================================
</TABLE>
NOTES TO FINANCIAL STATEMENTS
December 31, 1999
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES
AIM Advisor Large Cap 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 four
separate portfolios. 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 a high total
return on investment through growth of capital and current income, without
regard to federal income tax considerations.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of 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 on the exchange where
the security is principally traded,
8
<PAGE> 11
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 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
trading 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 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 as earned from settlement date and is recorded on
the accrual basis. Dividend income is recorded on the ex-dividend date. On
December 31, 1999, undistributed net investment income was decreased by
$2,338, undistributed net realized gains decreased by $1,530,510 and paid-in
capital increased by $1,532,848 as a result of differing book/tax treatment
of equalization 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 of capital stock 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. Expenses -- Distribution expenses directly attributable to a class of shares
are charged to that class' 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 master investment advisory
agreement, the Fund pays an advisory fee to AIM at the annual rate of 0.75% of
the Fund's average daily net assets. AIM has entered into a sub-advisory
agreement with INVESCO Capital Management, Inc. ("ICM") whereby AIM pays ICM an
annual rate of 0.20% of the Fund's average daily net assets.
The Company, pursuant to an operating services agreement with AIM, agreed to
pay AIM an annual rate of 0.45% of the Fund's average daily net assets for
providing or arranging to provide accounting, legal (except litigation),
dividend disbursing, transfer agency, registrar, custodial, shareholder
reporting, sub-accounting and recordkeeping services and functions. The
agreement provided that AIM pay all fees and expenses associated with these and
other functions, including, but not limited to, registration fees, shareholder
meeting fees, and proxy statement and shareholder report expenses. During the
year ended December 31, 1999, AIM was paid $183,274 under the agreement. As of
June 1, 1998, AIM voluntarily agreed to limit the operating services fees to an
annual rate of 0.45% of the first $50 million of the Fund's average daily net
assets and 0.10% of the Fund's average daily net assets in excess of $50
million. During the year ended December 31, 1999, AIM voluntarily waived
operating services fees in the amount of $250,946.
Pursuant to an amended operating services agreement effective July 1, 1999,
the Fund shall pay costs incurred for providing operating services, such as
accounting, legal (except litigation), dividend disbursing, transfer agency,
registrar, custodial, shareholder reporting, sub-accounting and recordkeeping
services and functions, including, but not limited to, registration fees,
shareholder meeting fees, and proxy statement and shareholder report expenses.
Further, the Fund's operating expenses are limited to 0.45% of the Fund's
average daily net assets.
Following the amendment to the operating services agreement effective July 1,
1999, the Fund entered into a master administrative services agreement with AIM.
Pursuant to a master administrative services agreement, the Fund has agreed to
pay AIM for certain administrative costs incurred in providing accounting
services to the Fund. For the period July 1, 1999 though December 31, 1999, AIM
was paid $25,205 for such services.
Following the amendment to the operating services agreement effective July 1,
1999, the Fund entered into a transfer agency and
9
<PAGE> 12
service agreement with A I M Fund Services, Inc. ("AFS"). Pursuant to a transfer
agency and service agreement, the Fund agreed to pay AFS a fee for providing
transfer agency and shareholder services to the Fund. For the period July 1,
1999 through December 31, 1999, AFS was paid $49,423 for such services.
The Company has entered into master distribution agreements with A I M
Distributors, Inc. ("AIM Distributors") to serve as the distributor for the
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% for three years beginning August 4, 1997.
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. During the year ended December 31, 1999, the Class A, Class B and Class
C shares paid AIM Distributors $32,843, $56,134 and $1,655,995, respectively, as
compensation under the Plans. During the year ended December 31, 1999, AIM
Distributors waived fees of $13,137 for Class A shares.
AIM Distributors received commissions of $20,196 from sales of the Class A
shares of the Fund during the year ended December 31, 1999. 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 year ended December 31, 1999,
AIM Distributors received $29,018 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 period July 1, 1999 through December 31, 1999, the Fund paid legal
fees of $1,113 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
During the year ended December 31, 1999, the Fund received reductions in
transfer agency fees from AFS (an affiliate of AIM) and reductions in custodian
fees of $706 and $949, respectively, under expense offset arrangements. The
effect of the above arrangements resulted in a reduction of the Fund's total
expenses of $1,655 during the year ended December 31, 1999.
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 The Chase Manhattan Bank. 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 year
ended December 31, 1999, 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. Prior to
May 28, 1999, the commitment fee rate was 0.05%. 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 year ended December 31, 1999 was
$78,092,874 and $118,841,686, respectively.
The amount of unrealized appreciation (depreciation) of investment securities,
for tax purposes, as of December 31, 1999 was as follows:
<TABLE>
<S> <C>
Aggregate unrealized appreciation of
investment securities $50,107,417
- ---------------------------------------------------------
Aggregate unrealized (depreciation) of
investment securities (6,484,595)
- ---------------------------------------------------------
Net unrealized appreciation of investment
securities $43,622,822
=========================================================
</TABLE>
Cost of investments for tax purposes is $118,273,864.
NOTE 7-CAPITAL STOCK
Changes in capital stock outstanding during the years ended December 31, 1999
and 1998 were as follows:
<TABLE>
<CAPTION>
1999 1998
------------------------- -------------------------
SHARES AMOUNT SHARES AMOUNT
---------- ------------ ---------- ------------
<S> <C> <C> <C> <C>
Sold:
Class A 159,413 $ 4,077,027 546,830 $ 13,836,246
- ------------------------------------------------------------------------------
Class B 227,858 5,636,287 312,678 8,015,582
- ------------------------------------------------------------------------------
Class C 440,345 10,891,628 745,155 18,894,552
- ------------------------------------------------------------------------------
Issued as reinvestment
of dividends:
Class A 72,911 1,550,569 48,828 1,187,383
- ------------------------------------------------------------------------------
Class B 37,976 796,679 20,082 485,925
- ------------------------------------------------------------------------------
Class C 787,496 16,527,190 553,152 13,379,377
- ------------------------------------------------------------------------------
Reacquired:
Class A (305,004) (7,653,122) (180,617) (4,516,745)
- ------------------------------------------------------------------------------
Class B (255,300) (6,280,728) (40,432) (1,001,292)
- ------------------------------------------------------------------------------
Class C (1,944,581) (47,418,598) (1,159,833) (29,276,581)
- ------------------------------------------------------------------------------
(778,886) $(21,873,068) 845,843 $ 21,004,447
==============================================================================
</TABLE>
10
<PAGE> 13
NOTE 8-FINANCIAL HIGHLIGHTS
Shown below are the financial highlights for a share of Class A capital stock
outstanding during each of the years in the three-year period ended December 31,
1999, for a share of Class B capital stock outstanding during the year ended
December 31, 1999 and the period March 3, 1998 (date sales commenced) through
December 31, 1998, and for a share of Class C capital stock outstanding during
each of the years in the five-year period ended December 31, 1999.
<TABLE>
<CAPTION>
CLASS A(a) CLASS B
----------------------------- ------------------
1999 1998(b) 1997(b) 1999 1998
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 25.20 $ 24.11 $ 20.57 $ 25.06 $ 25.59
- ------------------------------------------------------------ ------- ------- ------- ------- -------
Income from investment operations:
Net investment income 0.19 0.20 0.23 0.01 0.02
- ------------------------------------------------------------ ------- ------- ------- ------- -------
Net gains (losses) on securities (both realized and
unrealized) (0.30) 3.11 6.17 (0.31) 1.57
- ------------------------------------------------------------ ------- ------- ------- ------- -------
Total from investment operations (0.11) 3.31 6.40 (0.30) 1.59
- ------------------------------------------------------------ ------- ------- ------- ------- -------
Less distributions:
Dividends from net investment income (0.22) (0.12) (0.15) (0.04) (0.02)
- ------------------------------------------------------------ ------- ------- ------- ------- -------
Distributions from net realized gains (3.02) (2.10) (2.71) (3.02) (2.10)
- ------------------------------------------------------------ ------- ------- ------- ------- -------
Total distributions (3.24) (2.22) (2.86) (3.06) (2.12)
- ------------------------------------------------------------ ------- ------- ------- ------- -------
Net asset value, end of period $ 21.85 $ 25.20 $ 24.11 $ 21.70 $ 25.06
============================================================ ======= ======= ======= ======= =======
Total return(c) (0.01)% 14.07% 31.66% (0.75)% 6.51%
============================================================ ======= ======= ======= ======= =======
Ratios/supplemental data:
Net assets, end of period (000s omitted) $12,011 $15,684 $ 5,000 $ 6,573 $ 7,325
============================================================ ======= ======= ======= ======= =======
Ratio of expenses to average net assets(d) 1.26%(e) 1.30% 1.46% 1.95%(e) 2.05%(f)
============================================================ ======= ======= ======= ======= =======
Ratio of net investment income to average net assets(g) 0.70%(e) 0.91% 0.77% 0.01%(e) 0.16%(f)
============================================================ ======= ======= ======= ======= =======
Portfolio turnover rate 44% 52% 34% 44% 52%
============================================================ ======= ======= ======= ======= =======
</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) After fee waivers and/or reimbursements. Ratios of expenses to average net
assets prior to fee waivers and/or reimbursement were 1.50%, 1.55% and 1.56%
for 1999-1997 for Class A and 2.09% and 2.20% (annualized) for 1999-1998 for
Class B.
(e) Ratios are based on average net assets of $13,137,049 and $5,613,443 for
Class A and Class B, respectively.
(f) Annualized.
(g) After fee waivers and/or reimbursements. Ratios of net investment income
(loss) to average net assets prior to fee waivers and/or reimbursement were
0.46%, 0.66% and 0.67% for 1999-1997 for Class A, and (0.13)% and 0.01%
(annualized) for 1999-1998 for Class B.
<TABLE>
<CAPTION>
CLASS C(a)
-----------------------------------------------------------
1999 1998 1997(b) 1996 1995
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 25.05 $ 24.08 $ 20.57 $ 17.60 $ 13.96
- ------------------------------------------------------------ -------- -------- -------- -------- --------
Income from investment operations:
Net investment income 0.01 0.04 0.01 0.05 0.10
- ------------------------------------------------------------ -------- -------- -------- -------- --------
Net gains (losses) on securities (both realized and
unrealized) (0.30) 3.05 6.21 2.97 4.11
- ------------------------------------------------------------ -------- -------- -------- -------- --------
Total from investment operation (0.29) 3.09 6.22 3.02 4.21
- ------------------------------------------------------------ -------- -------- -------- -------- --------
Less distributions:
Dividends from net investment income (0.04) (0.02) -- (0.05) (0.10)
- ------------------------------------------------------------ -------- -------- -------- -------- --------
Distributions from net realized gains (3.02) (2.10) (2.71) -- (0.47)
- ------------------------------------------------------------ -------- -------- -------- -------- --------
Total distributions (3.06) (2.12) (2.71) (0.05) (0.57)
- ------------------------------------------------------------ -------- -------- -------- -------- --------
Net asset value, end of period $ 21.70 $ 25.05 $ 24.08 $ 20.57 $ 17.60
============================================================ ======== ======== ======== ======== ========
Total return(c) (0.71)% 13.15% 30.66% 17.17% 30.28%
============================================================ ======== ======== ======== ======== ========
Ratios/supplemental data:
Net assets, end of period (000s omitted) $142,672 $182,679 $172,228 $137,416 $113,573
============================================================ ======== ======== ======== ======== ========
Ratio of expenses to average net assets(d) 1.95%(e) 2.05% 2.21% 2.26% 2.28%
============================================================ ======== ======== ======== ======== ========
Ratio of net investment income to average net assets(f) 0.01%(e) 0.16% 0.02% 0.24% 0.64%
============================================================ ======== ======== ======== ======== ========
Portfolio turnover rate 44% 52% 34% 19% 17%
============================================================ ======== ======== ======== ======== ========
</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) After fee waivers and/or reimbursements. Ratios of expenses to average net
assets prior to fee waivers and/or reimbursement were 2.09% and 2.20% for
1999-1998.
(e) Ratios are based on average net assets of $165,599,460.
(f) After fee waivers and/or reimbursements. Ratios of net investment income
(loss) to average net assets prior to fee waivers and/or reimbursement were
(0.13)% and 0.01% for 1999-1998.
11
<PAGE> 14
INDEPENDENT AUDITORS' REPORT
The Board of Directors and Shareholders of
AIM Advisor Large Cap Value Fund:
We have audited the accompanying statement of assets and
liabilities of AIM Advisor Large Cap Fund (a portfolio of
AIM Advisor Funds, Inc.), including the schedule of
investments, as of December 31, 1999, and the related
statement of operations for the year then ended, the
statement of changes in net assets and the financial
highlights for each of the years in the two-year period
then ended. 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 generally
accepted auditing standards. Those standards require that
we plan and perform the audit to obtain reasonable
assurance about whether the financial statements and
financial highlights are free of material 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 December 31, 1999, by
correspondence with the custodian. 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
Large Cap Value Fund as of December 31, 1999, the results
of its operations for the year then ended, the changes in
its net assets and the financial highlights for each of
the years in the two-year period then ended, in
conformity with generally accepted accounting principles.
KPMG LLP
February 4, 2000
Houston, Texas
12
<PAGE> 15
<TABLE>
<CAPTION>
BOARD OF DIRECTORS OFFICERS OFFICE OF THE FUND
<S> <C> <C>
Charles T. Bauer Charles T. Bauer 11 Greenway Plaza
Chairman Chairman Suite 100
A I M Management Group Inc. Houston, TX 77046
Robert H. Graham
Bruce L. Crockett President INVESTMENT ADVISOR
Director
ACE Limited; Carol F. Relihan A I M Advisors, Inc.
Formerly Director, President, and Senior Vice President and Secretary 11 Greenway Plaza
Chief Executive Officer Suite 100
COMSAT Corporation Gary T. Crum Houston, TX 77046
Senior Vice President
Owen Daly II SUB-ADVISOR
Director Dana R. Sutton
Cortland Trust Inc. Vice President and Treasurer INVESCO Capital Management, Inc.
1315 Peachtree Street, N.E.
Edward K. Dunn Jr. Robert G. Alley Atlanta, GA 30309
Chairman, Mercantile Mortgage Corp.; Vice President
Formerly Vice Chairman, President TRANSFER AGENT
and Chief Operating Officer, Stuart W. Coco
Mercantile-Safe Deposit & Trust Co.; and Vice President A I M Fund Services, Inc.
President, Mercantile Bankshares P.O. Box 4739
Melville B. Cox Houston, TX 77210-4739
Jack Fields Vice President
Chief Executive Officer CUSTODIAN
Texana Global, Inc.; Karen Dunn Kelley
Formerly Member Vice President State Street Bank and Trust Company
of the U.S. House of Representatives 225 Franklin Street
Edgar M. Larsen Boston, MA 02110
Carl Frischling Vice President
Partner COUNSEL TO THE FUND
Kramer, Levin, Naftalis & Frankel LLP Mary J. Benson
Assistant Vice President and Ballard Spahr
Robert H. Graham Assistant Treasurer Andrews & Ingersoll, LLP
President and Chief Executive Officer 1735 Market Street
A I M Management Group Inc. Sheri Morris Philadelphia, PA 19103
Assistant Vice President and
Prema Mathai-Davis Assistant Treasurer COUNSEL TO THE DIRECTORS
Chief Executive Officer, YWCA of the U.S.A.
Renee A. Friedli Kramer, Levin, Naftalis & Frankel LLP
Lewis F. Pennock Assistant Secretary 919 Third Avenue
Attorney New York, NY 10022
P. Michelle Grace
Louis S. Sklar Assistant Secretary DISTRIBUTOR
Executive Vice President
Hines Interests Nancy L. Martin A I M Distributors, Inc.
Limited Partnership Assistant Secretary 11 Greenway Plaza
Suite 100
Ofelia M. Mayo Houston, TX 77046
Assistant Secretary
AUDITORS
Lisa A. Moss
Assistant Secretary KPMG LLP
700 Louisiana
Kathleen J. Pflueger Houston, TX 77002
Assistant Secretary
Samuel D. Sirko
Assistant Secretary
Stephen I. Winer
Assistant Secretary
</TABLE>
REQUIRED FEDERAL INCOME TAX INFORMATION (UNAUDITED)
AIM Advisor Large Cap Value Fund Class A, Class B, and Class C shares paid
ordinary dividends in the amount of $0.401, $0.2275, and $0.2275 per share,
respectively, to shareholders during its tax year ended December 31, 1999. Of
these amounts, 100% is eligible for the dividends received deduction for
corporations.
The Fund also distributed long-term capital gains of $20,386,010 for the Fund's
tax year ended December 31, 1999. Of long-term capital gains distributed, 100%
is 20% rate gain.
<PAGE> 16
THE AIM FAMILY OF FUNDS--Registered Trademark--
<TABLE>
<S> <C> <C>
GROWTH FUNDS MONEY MARKET FUNDS A I M Management Group Inc. has provided leadership
AIM Aggressive Growth Fund AIM Money Market Fund in the mutual fund industry since 1976 and managed
AIM Blue Chip Fund AIM Tax-Exempt Cash Fund approximately $160 billion in assets for more than
AIM Capital Development Fund 6.6 million shareholders, including individual
AIM Constellation Fund(1) INTERNATIONAL GROWTH FUNDS investors, corporate clients and financial
AIM Dent Demographic Trends Fund AIM Advisor International Value Fund institutions, as of December 31, 1999.
AIM Large Cap Growth Fund AIM Asian Growth Fund The AIM Family of Funds--Registered Trademark--
AIM Mid Cap Equity Fund AIM Developing Markets Fund is distributed nationwide, and AIM today is the
AIM Mid Cap Growth Fund AIM Euroland Growth Fund(4) eighth-largest mutual fund complex in the United
AIM Mid Cap Opportunities Fund AIM European Development Fund States in assets under management, according to
AIM Select Growth Fund AIM International Equity Fund Strategic Insight, an independent mutual fund
AIM Small Cap Growth Fund(2) AIM Japan Growth Fund monitor.
AIM Small Cap Opportunities Fund(3) AIM Latin American Growth Fund
AIM Value Fund AIM New Pacific Growth Fund
AIM Weingarten Fund
GLOBAL GROWTH FUNDS
GROWTH & INCOME FUNDS AIM Global Aggressive Growth Fund
AIM Advisor Flex Fund AIM Global Growth Fund
AIM Advisor Large Cap Value Fund
AIM Advisor Real Estate Fund GLOBAL GROWTH & INCOME FUNDS
AIM Balanced Fund AIM Global Growth & Income Fund
AIM Basic Value Fund AIM Global Utilities Fund
AIM Charter Fund
GLOBAL INCOME FUNDS
INCOME FUNDS AIM Emerging Markets Debt Fund
AIM Floating Rate Fund AIM Global Government Income Fund
AIM High Yield Fund AIM Global Income Fund
AIM High Yield Fund II AIM Strategic Income Fund
AIM Income Fund
AIM Intermediate Government Fund THEME FUNDS
AIM Limited Maturity Treasury Fund AIM Global Consumer Products and Services Fund
AIM Global Financial Services Fund
TAX-FREE INCOME FUNDS AIM Global Health Care Fund
AIM High Income Municipal Fund AIM Global Infrastructure Fund
AIM Municipal Bond Fund AIM Global Resources Fund
AIM Tax-Exempt Bond Fund of Connecticut AIM Global Telecommunications and Technology Fund(5)
AIM Tax-Free Intermediate Fund AIM Global Trends Fund(6)
</TABLE>
(1) Effective December 1, 1999, AIM Constellation Fund's investment strategy
broadened to allow investments across all market capitalizations. (2) AIM Small
Cap Growth Fund closed to new investors on November 8, 1999. (3) AIM Small Cap
Opportunities Fund closed to new investors on November 4, 1999. (4) On September
1, 1999, AIM Europe Growth Fund was renamed AIM Euroland Growth Fund. Previously
the fund invested in all size companies in most areas of Europe. The fund now
seeks to invest at least 65% of its assets in large-cap companies within
countries using the euro as their currency (EMU-member countries). (5) On June
1, 1999, AIM Global Telecommunications Fund was renamed AIM Global
Telecommunications and Technology Fund. (6) Effective August 27, 1999, AIM
Global Trends Fund was restructured to operate as a traditional mutual fund.
Before that date, the fund operated as a fund of funds. 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. If used as
sales material after April 20, 2000, this report must be accompanied by a
current Quarterly Review of Performance for AIM Funds.
[AIM LOGO APPEARS HERE]
INVEST WITH DISCIPLINE
--Registered Trademark--
LCV-AR-1
AIM Distributions, Inc.
