CARILLON FUND, INC.
ANNUAL REPORT - A MESSAGE FROM THE PRESIDENT
December 31, 1997
We are pleased to present the 1997 Carillon Fund, Inc. Annual
Report. In comparison with our benchmark, it was a mixed year of
investment performance for the Carillon funds, after having had
an excellent year in 1996. The 1997 returns were all in positive
territory, but were not up to our standards in several cases. We
look for improvement in relative performance, particularly from
our Capital Portfolio during 1998.
Economy and Financial Markets
The U.S. economy continued to display strength in 1997 with
better than a 3.5 percent rate of growth. The strong economy
aided corporate earnings reports which showed generally strong
results. Lower inflation numbers also were recorded in 1997, as
the Consumer Price Index came in below 2 percent for the year.
Despite rising labor costs, American businesses were able to
squeeze enough productivity out of their assets and employees to
produce this period of improving profits without significantly
raising consumer prices.
This confluence of rising profits and low inflation produced
outstanding conditions for America's financial markets as both
stocks and bonds rewarded investors with favorable results.
Larger capitalization stocks turned out to be the major
beneficiaries as indexes of larger stocks outpaced those of
smaller ones by 10 percent or more as investors apparently
sought safety and liquidity perceived to be available in larger,
more familiar corporations. The stock market suffered two
periods of decline during the year. The first occurred in the
spring when investors feared the strong economy would raise
interest rates, and the second in the fall when Asian stock
market meltdowns and currency devaluations shook the world's
financial markets. The Asian threat was the more serious one as
it contained the potential for intensified global competition
that could severely pressure the record level of U.S. corporate
profits.
The bond market produced a strong showing in 1997 following a
shaky start that included concerns the economy was overheating
and the Federal Reserve Board would increase short-term interest
rates several times. A rollicking rally developed in April and
continued during the remainder of 1997 when short-term rates did
not increase, the inflation rate decreased, and investors sought
the safety of U.S. Government bonds during the last quarter due
to Asian financial turmoil.
Valuation Levels
We believe the stock market continues to be substantially
overpriced compared with historical valuation levels. Ratios of
stock prices to earnings, cash flow, sales, Gross Domestic
Product, book value, replacement cost, dividends, or any other
fundamental measure that has ever shown much of a positive
correlation to long-term stock prices are at all-time highs.
This overvaluation should restrain future stock market advances,
and the market's value should return closer to historical norms
sometime during the late 1990s. However, since it is difficult
to know the exact timing of a return to a long-
term, historical valuation level, the bullish run in stocks may
not be completely over. Bond prices seem more closely aligned
with longer-term economic and inflationary conditions and should
continue to produce modest returns close to their interest rate
levels.
Outlook
While all stocks are at historically high levels of valuation, I
believe smaller stocks represent better relative value than
larger stocks. Smaller stocks are less fully valued in relation
to their growth prospects and they have less exposure to
international growth and currency fluctuations. The Equity
Portfolio remains, as always, substantially invested in stocks.
However, security selection remains targeted at smaller, highly
profitable companies selling at reasonable prices (such as the
oil service companies) and is looking at stocks in developing
country markets where prices have fallen to more attractive
levels. The Capital Portfolio maintains a conservative posture
toward stocks due to overall valuation levels, but has exposure
to real estate investment trusts, oil service stocks, and
selective foreign stocks, and keeps a healthy cash position
available to invest at the lower stock prices we see ahead.
Corporate earnings remain the key to this stock market's advance
and will be watched closely. Any overall reduction in earnings
would be devastating for a market so richly valued.
Individual Portfolio reports are included within this report.
Carillon Advisers is determined to provide excellent money
management and service related to all portfolios. We want each
Contract Owner to feel confident that investing with Carillon
Fund, Inc. is a prudent, long-term decision.
Sincerely,
/s/ George L. Clucas
George L. Clucas, President
January 26, 1998
This report has been prepared for the information of Contract
owners and is not authorized for distribution to prospective
purchasers of contracts unless it is preceded or accompanied by
an effective prospectus for Carillon Fund, Inc.
<PAGE>
EQUITY PORTFOLIO
Large capitalization stocks as measured by the S&P 500 Stock
Index were the big winners during 1997, while smaller company
stocks as measured by the Nasdaq Composite and Russell 2000
Index significantly trailed their returns for the year. This
market divergence was primarily responsible for the Equity
Portfolio's underperformance for the period. However, our
Equity Portfolio did perform in line with these small
capitalization indices for the year aided by the good
performance of financial service issues, oilfield service
stocks, and several of the fund's largest positions.
Morningstar, Inc. assigned the Equity Portfolio a composite
rating of *** (three stars) as of December 31, 1997, signifying
average performance for the 1682 funds in its category (see
following page). The following table illustrates the Equity
Portfolio's ranking based on total return as surveyed by Lipper
Analytical Variable Insurance Products Performance Analysis
Service Underlying Funds Report.
<TABLE>
<CAPTION>
Lipper Growth Fund Rankings as of December 31, 1997
1-Year 3-Year 5-Year 10-Year
<S> <C> <C> <C> <C>
Carillon Equity Portfolio Ranking 100 68 25 24
Total Number of Funds Ranked 127 97 55 38
</TABLE>
Past performance is no guarantee of future results.
The Equity Portfolio continued to add to its holdings of
companies with above-average returns on equity, favorable
historic sales and earnings growth, and strong balance sheets
whose stocks sell at low price-earnings ratios. After three
spectacular years of stock market advances, 1998 could well be a
difficult year as the infection spreads from Asian economies and
markets. Our stock selections favor small capitalization issues
which are less than fully valued in relation to their growth
rates and have little exposure to international turmoil.
Oilfield service stocks continue to represent an important theme
in the Portfolio based upon our positive outlook for natural gas
prices, increased drilling and production activity, and a
supply/demand imbalance for industry equipment and labor. New
purchases were made in this sector toward the end of the year as
the group corrected in sympathy with lower oil and gas commodity
prices. The companies in which the Equity Portfolio is invested
have experienced stronger sales and income growth than the
market and sell at lower valuations -- characteristics which we
believe will be rewarded with higher stock prices.
Comparison of Change in Value of $10,000 Investment
THE FOLLOWING LINE GRAPH DOES NOT REFLECT SEPARATE ACCOUNT
EXPENSES
(This line graph compares Carillon Equity Portfolio on an annual
basis with S&P 500 Stock Index and Consumer Price Index for the
period December 31, 1987 through December 31, 1997. The
following table appears at the upper left of the graph.)
<TABLE>
<CAPTION>
1 Year 5 Year 10 Year
<C> <C> <C>
20.56% 17.60% 16.38%
</TABLE>
Past performance is not predictive of future results.
<PAGE>
Carillon Fund, Inc.
EQUITY PORTFOLIO
Summary
- ---------------------------------------------------------
OBJECTIVE: Seeks long-term appreciation of capital by investing
in
common stocks and other equity securities with
values
that are, at present, not fully recognized by the
market.
STRATEGY: The Equity Portfolio will remain in a highly
invested
position ranging from 86% to 98%. The cash position
will
be held in highly liquid money market instruments to
meet
redemptions and to provide cash for future stock
purchases as new opportunities arise.
INCEPTION: August 15, 1984
MANAGERS: George Clucas; Michelle Stevens
- ---------------------------------------------------------
Highlights
On December 31, 1997, the Equity Portfolio had net assets of
$335,627,460 and diversified holdings of:
Common Stocks 90.6%
Short-Term and Other 9.4%
As an investor in the Carillon Equity Portfolio, for every $1
you had invested on December 31, 1997, your fund owned:
(the following percentages are graphically represented as
portions of a dollar bill)
Real Estate 11%
Financials 12.2%
Consumer Nondurable 8.9%
Consumer Cyclical 13%
Capital Goods 4.3%
Technology 6.4%
Energy/Utilities 14.4%
Manufacturing 14.2%
Short-Term and Other 9.4%
Transportation 5.2%
Service 1.0$
Top Ten Holdings
1. Lindsay Manufacturing Company
2. ICN Pharmaceuticals Incorporated
3. FPIC Insurance Group, Inc.
4. YPS S.A. Sponsored ADR
5. Comair Holdings Incorporated
6. Carbide Graphite Group, Inc.
7. Vtech Holdings Limited
8. Jefferies Group, Inc.
9. York Group Incorporated
10. Raymond James Financial Corp.
Morningstar, Inc. ratings are updated each month. The composite
rating is calculated using a weighted-average of the three
(three stars shown in parentheses), five (four stars shown in
parentheses) and ten (three stars shown in parentheses) year
ratings. These ratings are based on each period's risk-adjusted
average annual total returns (including the impact of insurance
expense charges). Ten percent of the funds in a category receive
five stars, the next 22.5% receive four stars and the next 35%
receive three stars.
<PAGE>
Carillon Fund, Inc.
CAPITAL PORTFOLIO
The Capital Portfolio faced a challenging year in 1997 as most
of the fund's long term investment principles worked against
performance for the period. The following factors contributed to
the Portfolio's below average performance: an underweighted
position in equities, the small capitalization bias of the
fund's stock holdings, diversification including Real Estate
Investment Trusts and precious metal issues, and exposure to
out-of-favor international markets. However, we believe that
the investment tenets of buying inexpensive foreign stock
markets based upon long-term market valuation techniques, buying
individual stocks that are attractively priced relative to their
growth rates, and using portfolio diversification to reduce
overall risk while enhancing return continue to be at the core
of an effective long-term investment strategy. As such, we
remain confident that this fund will provide good risk-adjusted
returns over a full economic cycle and look forward to providing
improved relative performance in 1998.
Morningstar, Inc. assigned the Capital Portfolio a composite
rating of ** (two stars) as of December 31, 1997, for the 3277
funds in its category (see following page). The following table
illustrates the Capital Portfolio's ranking based on total
return as surveyed by Lipper Analytical Variable Insurance
Products Performance Analysis Service Underlying Funds Report.
<TABLE>
<CAPTION>
Lipper Flexible Fund Rankings as of December 31, 1997
1-Year 3-Year 5-Year
<S> <C> <C> <C>
Carillon Capital Portfolio Ranking 84 63 51
Total Number of Funds Ranked 84 66 55
</TABLE>
Past performance is no guarantee of future results.
The Capital Portfolio is a professionally managed asset
allocation fund that shifts assets among stocks, bonds, and
money market instruments to take advantage of opportunities that
the portfolio manager believes will yield the most desirable
returns. The table on the following page highlights the
allocation of fund assets at December 31, 1997, six months ago,
one year ago and at a long-term normal portfolio allocation.
The combination of continued strength in the U. S. economy, low
inflation, good corporate profitability and falling interest
rates allowed the U.S. stock market to reach record levels in
1997. However, the domestic stock market is the most richly
valued in the twentieth century, including 1926, 1966, and 1987.
We believe that the collapse of Asian financial markets will
negatively impact U.S. corporate profitability, which has been
the underpinning of this great bull market. Intensified global
competition, reduced earnings from foreign subsidiaries, lower
exports, no pricing power, and a growing distrust of the safety
of financial markets could visit U.S. shores this year. As a
result, the Capital Portfolio remains conservatively positioned.
New stock purchases during the period centered on foreign and
energy-related securities which we believe represent better
relative value than most domestic stocks. The Portfolio's bond
allocation remains higher than normal due to the relative
attractiveness of fixed income securities and continues to
possess a shorter-than-average duration.
Comparison of Change in Value of $10,000 Investment
THE FOLLOWING LINE GRAPH DOES NOT REFLECT SEPARATE ACCOUNT
EXPENSES
(This line graph compares Carillon Capital Portfolio on an
annual basis with S&P 500 Stock Index, Lehman Aggregate Bond
Index and Consumer Price Index for the period May 1, 1990
through December 31, 1997. The following table appears at the
upper left of the graph.)
<TABLE>
<CAPTION>
Carillon Capital Portfolio Average Annual Total Return
1 Year 5 Year Since Inception
<C> <C> <C>
7.40% 9.93% 10.65%
</TABLE>
Past performance is not predictive of future results
<PAGE>
Carillon Fund, Inc.
CAPITAL PORTFOLIO
Summary
- ---------------------------------------------------------
OBJECTIVE: Seeks high total return by investing in a mix of
stocks, bonds and money market securities at the
discretion of the portfolio manager.
STRATEGY: When the investment climate is near long-term
historical relationships, the portfolio will
allocate its assets approximately 63% stocks, 30%
bonds, and 7% money market instruments. As market
conditions dictate, the Capital Portfolio repositions
its asset mix to take advantage of existing
opportunities.
INCEPTION: May 1, 1990
MANAGER: George Clucas
- ---------------------------------------------------------
Highlights
On December 31, 1997, the Capital Portfolio had net assets of
$148,832,791 and diversified holdings of:
<TABLE>
<CAPTION>
12/31/97 12/31/96 Long-Term
<S> <C> <C> <C>
Common Stocks 38.4% 34.4% 63%
Bonds and Notes 39.5% 4.05% 30%
Short-Term and Other 22.1% 25.1% 7%
</TABLE>
As an investor in the Carillon Capital Portfolio, for every $1
you had invested on December 31, 1997, your fund owned:
(the following percentages are graphically represented as
portions of a dollar bill)
U.S. Stocks 30.6%
International Stocks 7.1%
Precious Metals Related Stocks 0.9%
U.S. Government and Agency Securities 28.3%
Corporate Bonds 9.9%
Short-Term and Other 21.8%
Private Collateralized Morgtgage Obligations 1.4%
Top Ten Holdings
1. Lindsay Manufacturing Company
2. Hypevion 1999 Term Trust
3. YPF S.A. Sponsored ADR
4. FPIC Insurance Group Incorporated
5. Nortwest Pipe Company
6. Giant Industries Incorporated
7. York Group Incorporated
8. Trico Marine Services Incorporated
9. Bway Corporation
10. Merry Land and Investment Company
Morningstar, Inc. ratings are updated each month. The composite
rating is calculated using a weighted-average of the three
(three stars shown in parentheses), and five (two stars shown in
parentheses) year ratings. These ratings are based on each
period's risk-adjusted average annual total returns (including
the impact of insurance expense charges). The top ten percent of
the funds in a category receive five stars, the next 22.5%
receive four stars and the next 35% receive three stars, the
following 22.5% get 2 stars, and the bottom 10% receive one
star.
<PAGE>
Carillon Fund, Inc.
BOND PORTFOLIO
The year 1997 turned out to be another banner year for fixed
income investors as long-term Treasury bond yields moved below 6
percent for the first time since late 1993. There were various
influences on the bond market during the year:
1) The Federal Reserve, concerned about the strengthening
economy and the tightening labor market, raised the Fed funds
rate one-quarter percentage point March 20, to 5.50 percent.
2) Inflationary expectations, a strong economy, and fears of
further Fed tightening moves pushed long-term Treasury bonds to
their highest level of 7.17 percent on April 14. The stock
market sell-off coincided with the bond sell-off, and both
turned higher simultaneously. Continuing disinflationary trends
were later reinforced by a benign quarterly labor cost report. A
bond rally ensued.
3) Asian problems started to surface in June, beginning in
Thailand, and extended to other countries by July. As the
problems grew in severity, reports of steep currency declines
became common. A strong dollar and deepening Asian problems put
the Federal Reserve on the defensive and the bond rally
intensified.
4) The U.S. Congress and the Clinton Administration joined hands
over the summer to pass a budget resolution of middle-class tax
cuts and a reduction in capital gains tax.
5) Asian currency problems and illiquidity slowly migrated to
Hong Kong, causing a run on the Hong Kong dollar and the stock
market. The Hong Kong stock market collapsed, which finally
affected the U.S. market. The U.S. stock market correction
carried the Dow to an intra day low of 6940 on October 28,
followed by a vigorous rally. The stock market troubles put the
U.S. bond market rally in high gear.
6) U.S. government receipts exceeded estimates by a wide margin
because of a strong economy, the exercise of huge stock options
and capital gains taxes. The budget deficit declined to about
$40 billion, and was heading lower. This further encouraged the
bond market.
7) Foreign central bank holdings of U.S. Treasuries peaked in
April, but liquidation intensified as Asian problems became more
acute. Foreign central bank holdings decreased almost 8 percent
to about $615 billion by the end of November, yet the U.S. bond
market rallied to 6.03 percent by December 2.
The Bond Portfolio had strong relative performance in 1997
outperforming broader market indices such as the Salomon
Brothers Broad Investment Grade Index. The incremental return
can be attributed to two factors. First, the active sector
allocation strategy employed by the portfolio manager allowed
the Bond Portfolio to overweight corporate bonds--whose
performance was better than average in 1997. In addition,
further investments were made in corporate bonds whose returns
improved relative to U.S. Treasury securities as investors
favored spread products. Second, the individual securities
selected in each sector, particularly in the corporate bond
area, further enhanced returns due to improving credit
characteristics that were eventually recognized by other
investors.
Morningstar, Inc. continues to assign the Bond Portfolio its
**** (four star) risk-adjusting rating as of December 31, 1997
signifying above-average performance for the 2786 funds in its
category. The Portfolio continues its strong, long-term rankings
based on total returns surveyed by Lipper in its Variable
Insurance Product Performance Analysis Report.
<TABLE>
<CAPTION>
Lipper Corporate Bond (BBB) Rankings as of December 31, 1997
- ------------------------------------------------------------
1-Year 3-Year 5-Year 10-Year
<S> <C> <C> <C> <C>
Carillon Bond Portfolio Ranking 7 4 4 3
Total Number of Funds Ranked 35 31 26 21
</TABLE>
Rankings based on total return performance.
Past performance is no guarantee of future results.
Comparison of Change in Value of $10,000 Investment
THE FOLLOWING LINE GRAPH DOES NOT REFLECT SEPARATE ACCOUNT
EXPENSES
(this line graph compares the Carillon Bond Portfolio on an
annual basis with Lehman Aggregate Bond Index and Consumer Price
Index for the period December 31, 1987 through December 31,
1997. The following table appears at the upper left of the
graph.)
<TABLE>
<CAPTION>
Carillon Bond Portfolio Average Annual Total Return
1 Year 5 Year 10 Year
<C> <C> <C>
11.02% 9.30% 9.84%
</TABLE>
Past performance is not predictive of future results.
<PAGE>
Carillon Fund, Inc.
BOND PORTFOLIO
Summary
- ---------------------------------------------------------
Objective: Seeks a high level of current income, without
undue risk to principal, by investing in long-term,
fixed-income investment-grade corporate bonds.
STRATEGY: The Portfolio intends to invest at least 75% of the
value of its assets in publicly-traded straight
debt securities which have a rating within the four
highest grades as rated by a national rating agency.
Up to 25% of the portfolio may be invested in
convertible debt securities, convertible preferred
and preferred stock, or other securities.
INCEPTION: August 15, 1984
MANAGERS: Steven Sutermeister
- ---------------------------------------------------------
Highlights
On December 31, the Bond Portfolio had net assets of $99,892,096
and diversified holdings of:
Bonds 94.1%
Short-Term and Other 5.9%
As an investor in the Carillon Bond Portfolio, for every $1 you
had invested on December 31, 1997, your fund owned:
(the following percentages are graphically presented as portions
of a dollar bill)
Corporate Bonds - 49.7%
Mortgage and Asset-Backed Securities - 13.7%
U.S. Treasuries - 30.7%
Short-Term and Other - 5.9%
Morningstar, Inc. ratings are updated each month. The composite
rating is calculated using a weighted-average of the three(4
stars drawn in parentheses), five (4 stars drawn in parentheses)
and ten (4 stars drawn in parentheses) year ratings. These
ratings are based on each period's risk-adjusted average annual
total returns (including the impact of insurance expense
charges). Ten percent of the funds in a category receive five
stars, the next 22.5% receive four stars and the next 35%
receive three stars.
<PAGE>
Carillon Fund, Inc.
S&P 500 INDEX PORTFOLIO
Common stocks, as measured by the S&P 500 Index, posted
excellent returns during 1997. The S&P 500 Index gained 33.36
percent, while the Carillon S&P 500 Index Portfolio returned
32.72 percent. The Carillon S&P 500 Index Portfolio was ranked
#14 out of 26 similar funds by Lipper Analytical Variable
Insurance Products Performance Analysis Service based on its
1997 total return results. Since its inception on December 29,
1995, the Carillon S&P 500 Index Portfolio is ranked #1 out of
20 similar funds by Lipper.
The primary objective of the Carillon S&P 500 Index Portfolio is
to produce a return that is highly correlated to the total
return of the S&P 500 Index. The focus of the portfolio manager
is to monitor and minimize the difference between the return of
the Portfolio and the return of the underlying S&P 500 Index.
For the year 1997, the difference was only 64 basis points which
included approximately 51 basis points in fees and expenses
during the year.
The method used to create the Carillon S&P 500 Index Portfolio
at its inception was to select 300 stocks from the underlying
S&P 500 Index that would closely replicate the performance of
the actual index. These 300 stocks were chosen to ensure a high
correlation with the index while keeping transaction costs at a
minimum. By the end of 1997, the number of stocks held was
increased to 400 to more closely track the Index while keeping
costs low. During that time, the Portfolio grew from its
original size of $10.0 million to its current size of $55.6
million at December 31, 1997. The 400 stocks held represent
approximately 96 percent of the total market value of the Index.
Furthermore, the Carillon S&P 500 Index Portfolio was carefully
constructed to ensure that the weighting in each of S&P's 90
industry categories varied by less than 1 percent versus the
actual S&P 500 Index.
The Portfolio is designed to be highly correlated to the S&P 500
Index. Cash is held to a minimum, since it does not correlate
with the S&P 500 index, and transactions are limited to keep
expenses low. During 1997, the portfolio maintained a 99.9
percent correlation with the underlying S&P 500 Index.
In 1998, we will continue to build upon the success we have had
in managing the Carillon S&P 500 Index Portfolio. We expect the
Portfolio will continue to grow as investors are attracted to
the excellent returns that have been provided since the
Portfolio's inception. We are confident that we can, and will,
continue to provide a return that is highly correlated with the
underlying S&P 500 Index.
Comparison of Change in Value of $10,000 Investment
THE FOLLOWING LINE GRAPH DOES NOT REFLECT SEPARATE ACCOUNT
EXPENSES
(This line graph compares Carillon S&P 500 Index Portfolio on a
monthly basis with S&P 500 Stock Index for the period December
31, 1995 through December 31, 1997. The following table appears
at the upper left of the graph.)
<TABLE>
<CAPTION>
1 Year Since Inception
<C> <C>
32.7% 28.0%
</TABLE>
Past performance is not predictive of future results.
<PAGE>
Carillon Fund, Inc.
S&P INDEX PORTFOLIO
Summary
- ---------------------------------------------------------
OBJECTIVE: Seeks investment results that correspond to the
total return performance of U.S. common stocks, as
represented by the Standard & Poor's 500 Composite
Stock Index (the "S&P 500").
STRATEGY: The Index Portfolio will remain fully invested in
stocks included in the S&P 500 and in futures
contracts on the Index. The cash position will be
held in highly liquid money market instruments to
meet redemptions and to provide cash for future
stock purchases.
INCEPTION: December 29, 1995
MANAGER: Gary R. Rodmaker
- ---------------------------------------------------------
Highlights
On December 31, 1977, the S&P 500 Index Portfolio had net assets
of $55,594,669 and diversified holdings of:
Common Stocks 91.4%
Short-Term and Other 8.6%
As an investor in the Carillon S&P 500 Index Portfolio, for
every $1 you had invested on December 31, 1997, your fund owned:
(the following percentages are graphically represented as
portions of a dollar bill)
Transportation - 1.2%
Banking and Financial Service - 15.4%
Service - 0.1%
Capital Goods - 5.6%
Technology - 11.3%
Consumer Cyclical - 8.4%
Manufacturing - 7.9%
Consumer Nondurable - 24.2%
Short-Term, Futures and Other - 8.6%
Energy - 8.3%
Utilities - 9.0%
Top Ten Holdings
1. S&P 500 Depository Receipts
2. General Electric Company
3. Coca-Cola Company
4. Microsoft Corporation
5. Exxon Corporation
6. Merck & Company Inc.
7. Royal Dutch Petroleum Company ADR
8. Intel Corporation
9. Philip Morris Companies Inc.
10. Proctor & Gamble
"Standard & Poor's (R)", "S&P(R)", "S&P 500(R)", "Standard &
Poor's 500", and "500" are trademarks of The McGraw-Hill
Companies, Inc. and have been licensed for use by Carillon Fund,
Inc. The Product is not sponsored, endorsed, sold or promoted
by Standard & Poor's and Standard & Poor's makes no
representation regarding the advisability of investing in the
Product.
<PAGE>
CARILLON FUND, INC.
STATEMENTS OF ASSETS AND LIABILITIES
December 31, 1997
<TABLE>
<CAPTION>
S&P 500
Equity Capital Bond Index
Portfolio Portfolio Portfolio Portfolio
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
ASSETS
Investments in securities,
at value $330,299,046 $150,965,858 $98,239,839 $ 55,687,719
(cost $259,127,836;
$142,221,876; $94,380,244;
$43,705,163)
Cash ---- ---- ---- 37
Receivables:
Shares sold 277,598 58,316 93,459 214,644
Securities sold 6,147,350 1,005,213 ---- ----
Interest and Dividends 867,946 1,227,520 1,711,336 71,300
Prepaid expenses and other 25,213 14,032 7,211 3,151
------------ ------------ ----------- ------------
337,617,153 153,270,939 100,051,845 55,976,851
------------ ------------ ----------- ------------
LIABILITIES
Payables:
Investment securities
purchased 1,796,837 4,320,618 ---- 338,866
Open forward currency
contracts ---- 1,256 ---- ----
Shares redeemed ---- 2,921 58 1,808
Investment advisory fees 155,869 86,691 39,744 11,686
Custodial and portfolio
accounting fees 20,513 16,066 10,354 7,541
Professional fees 10,223 10,404 9,784 10,888
Bank overdraft 2,500 ---- ---- ----
Variation margin ---- ---- ---- 350
Other accrued expenses 3,751 3,113 2,156 11,043
Deferred compensation
for directors ---- ---- 97,653 ----
------------ ------------ ----------- ------------
1,989,638 4,441,069 159,749 382,182
------------ ------------ ----------- ------------
NET ASSETS
Paid-in capital 220,719,673 132,294,897 94,656,867 41,736,548
Undistributed net
investment income 231,700 541,406 264,047 39,665
Accumulated net realized
gain/(loss) of 43,504,877 7,249,585 1,111,587 1,788,399
investments and
futures contracts
Net unrealized
appreciation on 71,171,210 8,743,982 3,859,595 12,030,057
investments and ------------ ------------ ----------- ------------
futures contracts
$335,627,460 $148,829,870 $99,892,096 $55,594,669
------------ ------------ ----------- ------------
Shares authorized
($.10) par value 40,000,000 30,000,000 30,000,000 30,000,000
Shares outstanding 16,490,901 10,558,921 8,851,441 3,530,958
Net asset value,
offering and
redemption price $20.35 $14.10 $11.29 $15.74
per share
</TABLE>
The accompanying notes are an integral part of the
financial statement.
<PAGE>
CARILLON FUND, INC.
STATEMENTS OF OPERATIONS
Year Ended December 31, 1997
<TABLE>
<CAPTION>
S&P 500
Equity Capital Bond Index
Portfolio Portfolio Portfolio Portfolio
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Interest $ 1,523,662 $ 6,383,812 $ 6,944,771 $ 148,819
Dividends (net of
foreign withholding
taxes of $69,671;
$25,812; $0; $4,344) 4,247,554 1,428,148 --- 705,234
----------- ----------- ----------- -----------
5,771,216 7,811,960 6,944,771 854,053
----------- ----------- ----------- -----------
EXPENSES
Investment advisory fees 1,731,351 1,058,086 427,729 129,253
Custodial fees and
expenses 78,173 42,679 24,972 14,854
Portfolio accounting fees 52,484 46,068 38,753 29,379
Professional fees 12,941 12,858 13,739 16,352
Director's fees 12,361 12,361 11,938 12,676
Transfer agent fees 8,151 8,330 8,214 7,071
Registration and
filing fees 1,744 --- --- 2,189
Other 33,627 21,658 14,115 2,210
----------- ----------- ----------- -----------
1,930,832 1,202,040 539,460 213,984
----------- ----------- ----------- -----------
NET INVESTMENT INCOME 3,840,384 6,609,920 6,405,311 640,069
----------- ----------- ----------- -----------
REALIZED AND
UNREALIZED GAIN/(LOSS)
Net realized gain
on investments 43,526,118 7,443,577 1,127,264 1,063,996
Net realized gain
on futures contracts --- --- --- 775,950
----------- ----------- ----------- -----------
43,526,118 7,443,577 1,127,264 1,839,946
----------- ----------- ----------- -----------
Net change in unrealized
appreciation/(depreciation)
on investments,futures
contracts and translation
of assets and liabilities
in foreign currencies 10,788,049 (2,869,048) 1,821,402 9,001,133
----------- ----------- ----------- -----------
NET REALIZED AND
UNREALIZED GAIN/(LOSS) 54,314,167 4,574,529 2,948,666 10,839,129
----------- ----------- ----------- -----------
NET INCREASE IN
NET ASSETS
FROM OPERATIONS $58,154,551 $11,184,449 $ 9,353,977 $11,479,198
=========== =========== =========== ===========
</TABLE>
The accompanying notes are an integral part of
the financial statements.
<PAGE>
CARILLON FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Equity Portfolio
Year Ended December 31,
1997 1996
------------ ------------
<S> <C> <C>
OPERATIONS
Net investment income $ 3,840,384 $ 4,176,431
Net realized gain on
investments and futures 43,526,118 34,227,538
Net change of unrealized
appreciation/(depreciation)
on investments, futures
contracts and translation
of assets and liabilities
in foreign currencies 10,788,049 17,468,047
------------ ------------
58,154,551 55,872,016
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income (4,343,382) (3,889,965)
In excess of net investment income ----
Net realized gain on investments (34,344,113) (9,867,342)
------------ ------------
(38,687,495) (13,757,307)
------------ ------------
FUND SHARE TRANSACTIONS
Proceeds from shares sold 27,675,023 41,762,282
Reinvestment of distributions 38,687,495 13,757,307
Payments for shares redeemed (38,325,837) (29,073,822)
------------ ------------
28,036,681 26,445,767
------------ ------------
NET INCREASE IN NET ASSETS 47,503,737 68,560,476
NET ASSETS
Beginning of year 288,123,723 219,563,247
------------ ------------
End of year $335,627,460 $288,123,723
============ ============
FUND SHARE TRANSACTIONS
Sold 1,441,326 2,393,015
Reinvestment of distributions 2,276,903 809,878
Redeemed (2,041,013) (1,660,244)
------------ ------------
Net increase from fund
share transactions 1,677,216 1,542,649
============ ============
</TABLE>
The accompanying notes are an integral part of
the financial statements.
<PAGE>
CARILLON FUND, INC.
TATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Capital Portfolio
Year Ended December 31,
1997 1996
------------ ------------
<S> <C> <C>
OPERATIONS
Net investment income $ 6,609,920 $ 6,684,340
Net realized gain on
investments and futures 7,443,577 12,459,745
Net change in unrealized
appreciation/(depreciation) on
investments, futures contracts
and translation of assets and
liabilities in foreign currencies (2,869,048) 1,990,613
------------ ------------
11,184,449 21,134,698
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income (7,176,810) (6,050,397)
In excess of net investment income ----
Net realized gain on investments (12,519,532) (2,002,549)
------------ ------------
(19,696,342) (8,052,946)
------------ ------------
FUND SHARE TRANSACTIONS
Proceeds from shares sold 12,291,701 17,130,822
Reinvestment of distributions 19,696,342 8,052,945
Payments for shares redeemed (33,940,166) (24,594,141)
------------ ------------
(1,952,123) 589,626
------------ ------------
NET INCREASE/(DECREASE)IN NET ASSETS (10,464,016) 13,671,378
NET ASSETS
Beginning of year 159,293,886 145,622,508
------------ ------------
End of year $148,829,870 $159,293,886
============ ============
FUND SHARE TRANSACTIONS
Sold 867,273 1,199,385
Reinvestment of distributions 1,450,496 570,034
Redeemed (2,414,218) (1,729,493)
------------ ------------
Net increase/(decrease) from fund
share transactions (96,449) 39,926
============ ============
</TABLE>
The accompanying notes are an integral part of
the financial statements.
<PAGE>
CARILLON FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Bond Portfolio
Year Ended December 31,
1997 1996
----------- -----------
<S> <C> <C>
OPERATIONS
Net investment income $ 6,405,311 $ 5,766,633
Net realized gain/(loss)
on investments and futures 1,127,264 1,210,173
Net change of unrealized
appreciation/(depreciation) on
investments, futures contracts
and translation of assets and
liabilities in foreign currencies 1,821,402 (1,316,722)
----------- -----------
9,353,977 5,660,084
----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income (5,860,151) (6,340,623)
In excess of net investment income (320,260)
Net realized gain on investments (481,254) ---
----------- -----------
(6,341,405) (6,660,883)
----------- -----------
FUND SHARE TRANSACTIONS
Proceeds from shares sold 19,937,289 17,850,341
Reinvestment of distributions 6,341,405 6,660,883
Payments for shares redeemed (15,033,299) (11,443,995)
----------- -----------
11,245,395 13,067,229
----------- -----------
NET INCREASE IN NET ASSETS 14,257,967 12,066,430
NET ASSETS
Beginning of year 85,634,129 73,567,699
----------- -----------
End of year $99,892,096 $85,634,129
=========== ===========
FUND SHARE TRANSACTIONS
Sold 1,786,820 1,633,803
Reinvestment of distributions 575,269 621,662
Redeemed (1,358,088) (1,054,560)
----------- -----------
Net increase from fund
share transactions 1,004,001 1,200,905
=========== ===========
</TABLE>
The accompanying notes are an integral part of
the financial statements.
<PAGE>
CARILLON FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
S&P 500 Index Portfolio
Year Ended December 31,
1997 1996
----------- -----------
<S> <C> <C>
OPERATIONS
Net investment income $ 640,069 $ 349,515
Net realized gain on
investments and futures 1,839,946 218,750
Net change of unrealized
appreciation/(depreciation) on
investments, futures contracts
and translation of assets and
liabilities in foreign currencies 8,999,183 3,030,849
----------- -----------
11,479,198 3,599,114
----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income (642,656) (307,386)
Net realized gain on investments (270,297) ----
----------- -----------
(912,953) (307,386)
----------- -----------
FUND SHARE TRANSACTIONS
Proceeds from shares sold 35,592,857 30,917,430
Reinvestment of distributions 912,953 307,386
Payments for shares redeemed (20,681,996) (5,617,082)
----------- -----------
15,823,814 25,607,734
----------- -----------
NET INCREASE IN NET ASSETS 26,390,059 28,899,462
NET ASSETS
Beginning of year 29,204,610 305,148
----------- -----------
End of year $55,594,669 $29,204,610
=========== ===========
FUND SHARE TRANSACTIONS
Sold 2,463,755 2,850,416
Reinvestment of distributions 66,017 26,989
Redeemed (1,406,317) (500,402)
----------- -----------
Net increase from fund
share transactions 1,123,455 2,377,003
=========== ===========
</TABLE>
The accompanying notes are an integral part of
the financial statements.
<PAGE>
CARILLON FUND, INC.
SCHEDULE OF INVESTMENTS
EQUITY PORTFOLIO
<TABLE>
<CAPTION>
DECEMBER 31, 1997
COMMON STOCKS - 90.63% SHARES/
PRINCIPAL VALUE
--------- ------------
<S> <C> <C>
BANKING & FINANCIAL SERVICE - 12.20%
Allied Capital Corporation $ 30,571 $ 680,204
Banco BHIF ADR 123,000 1,968,000
Banco Frances del Rio de la Plata S.A. ADR 86,000 2,354,250
Banco Latinoamericano
De Exportaciones Sponsored ADR 27,000 1,117,125
BankUnited Financial Corporation* 140,000 2,156,875
Charter One Financial, Incorporated 55,125 3,479,766
Chile Fund Incorporated 100,000 1,781,250
Czech Republic Fund 109,000 1,308,000
Deutsche Bank AG Sponsored ADR 42,000 2,966,556
Duff & Phelps Credit Rating Company 65,000 2,640,625
FPIC Insurance Group Incorporated* 172,500 5,024,063
Fahnestock Viner Holdings CL-A 150,000 2,615,625
First Bell Bancorp Incorporated 100,000 1,900,000
Hamilton Bancorp Incorporated 100,000 2,912,500
Jefferies Group, Incorporated 100,000 4,093,750
Raymond James Financial Corporation 99,150 3,935,016
------------
40,933,605
------------
CAPITAL GOODS - 4.38%
AGCO Corporation 59,400 1,737,450
DT Industries, Incorporated 50,000 1,700,000
Lindsay Manufacturing Company 151,793 6,584,021
LSI Industries 100,000 1,825,000
Omniquip International, Incorporated 143,000 2,851,063
------------
14,697,534
------------
CONSUMER CYCLICAL - 12.98%
Breed Technologies, Incorporated 63,000 1,149,750
CPAC, Incorporated 200,000 2,050,000
Cemex SA - Spons ADR "B" 200,000 2,123,578
Claire's Stores Incorporated 50,000 971,875
D.R. Horton Incorporated 150,000 2,606,250
Footstar Incorporated* 85,000 2,284,375
Griffon Corporation* 209,600 3,065,400
Kevco Incorporated* 140,000 2,310,000
Maxwell Shoe Company Incorporated - A* 167,500 1,800,625
NCI Building Systems, Incorporated* 80,700 2,864,850
Quaker Fabric Corporation* 100,000 1,962,500
Schult Homes 98,060 2,034,745
Southern Energy Home* 217,000 1,736,000
Stanley Furniture Company 91,900 2,561,713
Strattec Security Corporation* 145,000 3,697,500
Supreme International Corporation* 162,500 2,031,250
Tarrant Apparel Group* 140,000 2,187,500
Toll Brothers* 90,000 2,407,500
Winsloew Furniture, Incorporated* 188,300 2,730,350
VISX, Incorporated* 45,000 995,625
------------
43,571,386
------------
CONSUMER NON-DURABLE - 8.95%
Charoen Pok Feedmill ADR 100,000 706,140
Complete Management Incorporated* 175,000 2,450,000
Dairy Farm International
Holdings Sponsored ADR 200,000 1,079,995
Equity Marketing Incorporated* 105,500 2,637,500
GT Bicycles, Incorporated* 175,000 1,039,061
Gymboree Corporation* 75,000 2,053,125
ICN Pharmaceuticals, Incorporated 106,600 5,203,413
IHOP Corporation* 55,000 1,787,500
Lone Star Steakhouse* 95,000 1,662,500
Lunar Corporation* 100,000 2,050,000
National Health Investors, Incorporated 40,000 1,675,000
Orthofix International N.V. 125,536 1,475,048
Schlotzsky's, Incorporated* 156,900 2,294,663
Scientific Games Holdings Corporation* 72,600 1,470,150
Young Innovations, Incorporated* 136,000 2,448,000
------------
30,032,095
------------
ENERGY - 14.40%
Basin Exploration Incorporated* 60,000 1,065,000
Bayard Drilling Technologies* 125,000 2,031,250
Callon Petroleum Company* 140,000 2,279,375
Cross Timbers Oil Company 105,000 2,618,437
Domain Energy Corporation* 175,000 2,756,250
Giant Industries, Incorporated 205,000 3,895,000
Global Industries, Incorporated* 100,000 1,700,000
Gulf Island Fabrication, Incorporated 103,000 2,060,000
KCS Energy Incorporated 104,000 2,158,000
Marine Drilling Company, Incorporated* 110,000 2,282,500
Maverick Tube Corporation 45,000 1,111,563
Offshore Logistics Incorporated* 120,000 2,565,000
OYO Geospace Corporation* 20,000 377,500
Parker Drilling Company* 120,000 1,462,500
Plains Resources, Incorporated* 119,500 2,053,906
Pride International Incorporated 80,000 2,020,000
Southern Mineral Corporation* 350,000 1,925,000
St. Mary Land & Exploration 20,000 700,000
Stone Energy Corporation* 63,000 2,110,500
Unifab International Incorporated* 155,000 2,983,750
Vastar Resources Incorporated* 50,000 1,787,500
YPF S.A. Sponsored ADR 145,400 4,970,863
Zeigler Coal Holding Company 87,000 1,419,188
------------
48,333,082
------------
MANUFACTURING - 14.17%
AEP Industries, Incorporated* 3,950 121,956
BWAY Corporation* 165,000 3,774,375
Bayer A G Sponsored ADR* 75,000 2,803,043
Buckeye Technologies Incorporated* 51,000 2,358,750
Carbide Graphite Group Incorporated* 130,000 4,387,500
Elamex SA De CV 100,600 754,500
Fibermark, Incorporated* 115,000 2,472,500
Giant Cement Holding Incorporated* 58,500 1,352,813
Greif Brothers Corporation 82,800 2,773,800
Intermet Corporation 125,000 2,187,500
Matthews International Corporation 77,000 3,388,000
Medusa Corporation 80,300 3,357,544
Minorco Sponsored ADR 90,000 1,507,500
Mueller Industries* 50,000 2,950,000
Northwest Pipe Company* 125,800 3,019,200
Sybron Chemicals, Incorporated* 65,200 2,184,200
Tubos De Acero De Mex SA* 50,000 1,081,250
Triangle Pacific Corporation* 92,500 3,133,438
York Group, Incorporated 162,000 3,948,750
------------
47,556,619
------------
REAL ESTATE - 10.95%
Associated Estates Realty Corporation 105,000 2,487,188
City Developments Limited ADR 250,000 1,157,298
Commercial Net Lease Realty 99,300 1,774,988
Equity Residential Properties Trust 46,000 2,325,875
Healthcare Realty Trust 96,400 2,789,575
Health & Retirement Property Trust 75,000 1,500,000
Hospitality Properties Trust 64,000 2,104,000
IRT Property Company 82,000 968,625
Lexington Corporation Property 100,000 1,543,750
Merry Land & Investment Company 115,000 2,630,625
Mid-America Apartment Communities 80,000 2,285,000
Oasis Residential Incorporated 58,000 1,294,125
Omega Healthcare Investors, Incorporated 30,000 1,158,750
Pacific Gulf Properties 74,000 1,757,500
Parkway Properties Incorporated 42,000 1,441,125
RFS Hotel Investors Incorporated 90,000 1,794,375
Trinet Corporate Realty Trust Incorporated 80,000 3,095,000
United Dominion Realty Trust Incorporated 168,000 2,341,500
Winston Hotels, Incorporated 175,000 2,296,875
------------
36,746,174
------------
SERVICE - 1.00%
Devon Group, Incorporated* 73,000 3,358,000
TECHNOLOGY - 6.43%
AFC Cable Systems Incorporated* 125,000 3,718,750
Axiohm Technology* 11,438 194,446
Cybex Corporation* 160,000 3,920,000
Nam Tai Electronics, Incorporated 250,000 3,734,375
Performance Technologies Incorporated* 115,500 1,674,750
Recoton Corporation* 163,000 2,200,500
Vertex Communications Corporation* 80,000 1,930,000
Vtech Holdings Limited 142,900 4,214,178
------------
21,586,999
------------
TRANSPORTATION - 5.17%
ASA Holdings Incorporated 48,000 1,365,000
Comair Holdings Incorporated 187,500 4,523,438
Illinois Central Corporation CL A 82,500 2,810,156
Landstar, Incorporated* 90,000 2,373,750
Midwest Express Holdings* 97,500 3,784,219
Trico Marine Services* 85,000 2,496,875
------------
17,353,438
------------
Total Common Stocks (cost $ 232,995,606) 304,168,932
------------
SHORT-TERM INVESTMENTS - 7.78%
<CAPTION>
PRINCIPAL VALUE
--------- -----
<S> <C> <C>
VARIABLE RATE DEMAND NOTES<FN1> - 1.07%
American Family (5.639% due 01/01/98) 502,036 $ 502,036
General Mills (5.327% due 01/01/98) 353,000 353,000
Johnson Controls (5.327% due 01/01/98) 608,058 608,058
Pitney Bowes (5.327% due 01/01/98) 408,068 408,068
Sara Lee (5.322% due 01/01/98) 985,783 985,783
Warner Lambert (5.489 due 01/01/98) 581,180 581,180
Wisconsin Electric (5.487% due 01/01/98) 161,892 161,892
------------
3,600,017
------------
FEDERAL HOME LOAN
MORTGAGE CORPORATION - 1.56%
(5.800% due 06/12/98) 1,500,000 $ 1,500,676
(5.760% due 07/08/98) 3,740,000 3,740,710
------------
5,241,386
------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION- .89%
(5.710% due 06/23/98) 3,000,000 3,000,339
------------
FEDERAL HOME LOAN BANK - 1.14%
(6.200% due 06/10/98) 1,100,000 1,102,363
(5.390% due 02/11/98) 1,500,000 1,490,792
5.135% due 03/02/98) 1,250,000 1,247,977
------------
3,841,132
------------
FEDERAL FARM CREDIT BANK - .60%
(5.750% due 07/01/98) 2,000,000 2,000,302
COMMERCIAL PAPER - 2.52%
CSX Corporation (5.950% due 02/06/98) 2,500,000 2,485,125
Du Pont E I De Nemours (5.500% due 04/02/98) 2,000,000 1,972,194
Ford Motor Credit (5.690% due 01/27/98) 2,000,000 1,991,781
Hertz Corporation (5.560% due 01/08/98) 2,000,000 1,997,838
------------
8,446,938
------------
Total Short-Term Investments
(cost $26,132,230) 26,130,114
------------
TOTAL INVESTMENTS - 98.41%
(cost $259,127,836) <FN2> 330,299,046
OTHER ASSETS AND LIABILITIES - 1.59% 5,328,414
------------
TOTAL NET ASSETS - 100% $335,627,460
============
____________
*Non-income producing
(ADR) American Depository Receipt
<FN>
<FN1> Interest rates vary periodically based on current market rates. The
maturity shown for each variable rate demand note is the later of the next
scheduled interest rate adjustment date or the date on which principal can be
recovered through demand. Information as of December 31, 1997.
<FN2> Represents cost for Federal income tax purposes. Gross unrealized
appreciation and depreciation of securities at December 31, 1997 for
financial reporting purposes was $84,920,427 and $13,749,217.
</FN>
</TABLE>
The accompanying notes are an integral part of
the financial statements.
<PAGE>
Carillon Fund, Inc.
Schedule of Investments
CAPITAL PORTFOLIO
<TABLE>
<CAPTION>
DECEMBER 31, 1997
COMMON STOCKS - 37.14% SHARES/
PRINCIPAL VALUE
--------- ------------
<S> <C> <C>
BANKING & FINANCIAL SERVICE - 9.27%
AFP Provida S.A.* $ 48,400 $ 825,825
Allied Capital Corporation 36,685 816,240
Banco BHIF ADR 73,000 1,168,000
Banco Frances del Rio de la Plata S.A. ADR 35,000 958,125
Chile Fund 55,000 979,688
Fahnestock Viner Holdings Class-A 70,000 1,220,625
FPIC Insurance Group Incorporated* 65,000 1,893,125
Hyperion 1999 Term Trust 300,000 2,081,250
Income Opportunity Fund 1999 100,000 956,250
Income Opportunity Fund 2000 88,500 851,813
New Germany Fund 81,597 1,101,560
Templeton Global Income Fund 125,000 937,500
------------
13,790,001
------------
CAPITAL GOOD - 2.17%
AGCO Corporation 37,000 1,082,250
Lindsay Manufacturing, Company 49,362 2,141,077
------------
3,223,327
------------
CONSUMER CYCLICAL - 1.86%
Griffon Corporation* 55,000 804,375
NCI Building Systems Incorporated* 35,000 1,242,500
Winsloew Furniture Incorporated* 49,800 722,100
------------
2,768,975
------------
CONSUMER NON-DURABLE - 2.38%
GT Bicycles Incorporated* 80,000 475,000
Complete Management, Incorporated* 57,000 798,000
ICN Pharmaceuticals, Incorporated 27,000 1,317,938
Gymboree Corporateion* 33,000 903,375
Orthofix International N.V.* 4,000 47,000
------------
3,541,313
------------
ENERGY - 6.33%
Basin Exploration Incorporated* 44,000 781,000
Callon Petroleum Company* 35,000 569,844
Cross Timbers Oil Company 27,450 684,534
Domain Energy Corporation* 48,000 756,000
Giant Industries Incorporated 87,400 1,660,600
Gulf Island Fabrication, Incorporated 40,000 800,000
Pride International Incorporated* 46,000 1,161,500
Unifab International Incorporated* 50,000 962,500
YPF S.A. Sponsored ADR 60,000 2,051,250
------------
9,427,228
------------
MANUFACTURING - 4.78%
AEP Industries, Incorporated* 6,331 195,470
Bway Corporation 61,800 1,413,675
Carbide Graphite Group* 40,000 1,350,000
De Beers Centenary AG ADR 32,000 654,000
Northwest Pipe Company* 74,600 1,790,400
Royal Oak Mines Incorporated* 125,000 195,313
York Group Incorporated 62,000 1,511,250
------------
7,110,108
------------
REAL ESTATE - 6.51%
Associated Estates Realty Corporation 50,000 1,184,375
City Developments Limited ADR 95,000 439,770
Equity Residential Properties Trust 19,500 985,964
Merry Land & Investment Company 60,000 1,372,500
Mid-America Apartment Communities 40,000 1,142,500
Pacific Gulf Properties 43,500 1,033,125
Trinet Corporate Realty Trust 32,000 1,238,000
United Dominion Realty Trust 75,000 1,045,313
Winston Hotels Incorporated 95,000 1,246,875
------------
9,688,422
------------
TECHNOLOGY - 2.82%
AFC Cable Systems, Incorporated 23,750 706,563
Axiohm Technology* 5,420 92,140
Cybex Corporation* 20,000 490,000
Nam Tai Electronics 57,333 856,412
Vertex Communications Corporation* 34,100 822,663
Vtech Holdings Limited 42,000 1,238,597
------------
4,206,375
------------
TRANSPORTATION - 1.01%
Trico Marine Services* 51,000 1,498,125
Total Common Stocks (cost $47,441,092) 55,253,874
------------
FOREIGN COMMON STOCK - 1.23%
NORWAY - .69%
Petrolia Drilling ASA* 200,000 1,025,476
------------
MALAYSIA - .54%
Bumi Armada Berhad* 500,000 319,857
Road Builder Holdings BHD* 748,000 480,500
------------
800,357
------------
Total Foreign Common Stock (cost $2,216,981) 1,825,833
------------
PREFERRED STOCK - .32%
MANUFACTURING - .32%
Freeport McMoRan Copper & Gold Series 20,000 480,000
------------
Total Preferred Stock (cost $ 709,838) 480,000
------------
U.S. TREASURY OBLIGATIONS - 15.42%
7.875% due 04/15/98 500,000 503,438
5.750% due 12/31/98 2,000,000 2,002,500
5.500% due 02/28/99 1,000,000 998,125
6.000% due 10/15/99 5,900,000 5,933,188
7.500% due 11/15/01 500,000 530,313
6.375% due 08/15/02 1,750,000 1,795,391
5.750% due 08/15/03 3,000,000 3,002,814
5.875% due 02/15/04 100,000 100,906
7.250% due 05/15/04 2,000,000 2,158,750
7.875% due 11/15/04 5,300,000 5,924,408
------------
Total U.S. Treasury Obligations ($22,139,588) 22,949,833
------------
COLLATERALIZED MORTGAGE OBLIGATIONS - 11.30%
FEDERAL HOME LOAN MORTGAGE CORPORATION- 3.43%
1662 H (6.250% due 01/15/09) 760,362 752,895
1442 FA (5.730% due 11/15/07) 1,000,000 994,474
1559 VP (5.500% due 02/15/20) 1,700,000 1,662,940
1399 PAC (7.000% due 09/15/22) 596,484 591,105
1631 SB (5.850% due 12/15/23) 1,450,000 1,102,520
------------
5,103,934
------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION- 6.52%
Remic 93-12 ED
(7.500% due 02/25/06) 1,645,000 1,714,048
Remic 92-117 J
(7.500% due 07/25/20) 1,000,000 1,014,325
Remic 93-127 FA
(5.130% due 10/25/21) 1,000,000 962,832
Remic 92-66 F
(6.218% due 05/25/22) 804,241 808,434
Remic 1993-163 PN
(7.000% due 07/25/07) 1,500,000 1,548,003
Remic 92-112 E
(8.000% due 12/25/20) 1,500,000 1,551,392
Remic 93-119 SB
(6.807% due 07/25/23) 2,572,882 2,103,962
------------
9,702,996
------------
PRIVATE SECTOR - 1.35%
Prudential Home Mortgage Securities
(7.500% due 07/25/10) 493,830 501,702
SLMA Med Term Note (5.850% due 06/10/98) 1,500,000 1,502,277
------------
2,003,979
------------
Total Collateralized Mortgage Obligations
(cost $16,455,259) 16,810,909
------------
MORTGAGE-BACKED SECURITIES - 2.95%
FEDERAL HOME LOAN MORTGAGE CORPORATION - .75%
7.500% due 06/01/07 36,785 37,203
9.500% due 10/01/08 182,147 193,299
8.250% due 03/01/12 93,943 96,931
8.500% due 03/01/16 88,054 92,128
7.500% due 07/01/17 32,324 33,028
11.000% due 04/01/19 41,157 46,374
11.000% due 11/01/19 52,944 59,656
11.000% due 05/01/20 173,444 195,336
11.000% due 06/01/20 326,695 368,287
------------
1,122,242
------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION -1.91%
10.00% due 02/01/04 2,064 2,197
9.500% due 09/01/05 116,671 122,113
9.000% due 11/01/05 36,130 37,706
7.500% due 03/25/07 1,200,000 1,241,510
8.000% due 05/01/07 116,876 120,950
5.500% due 01/01/09 799,034 776,302
5.500% due 04/01/09 554,612 537,769
------------
2,838,547
------------
GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION - .29%
9.000% due 11/15/16 88,798 97,055
10.500% due 11/20/19 200,083 218,882
9.000% due 12/15/19 100,639 109,626
------------
425,563
------------
Total Mortgage-Backed Securities
(cost $4,227,599) 4,386,352
------------
CORPORATE BONDS AND NOTES - 9.83%
COMMUNICATIONS AND MEDIA - 1.70%
Lowen Group International, Inc.
(8.2500% due 04/15/03) 900,000 953,221
MCI Communications Corp. Sr. Notes
(7.500% due 08/20/04) 1,500,000 1,573,770
------------
2,526,991
------------
FINANCE COMPANY - .95%
Hutchison Whampoa (6.950% due 08/01/07) 1,500,000 1,413,390
REAL ESTATE - .35%
GE Capital Mortgage Services, Inc.
(6.000% due 08/25/09) 534,970 515,188
FINANCIAL SERVICES - .85%
Indah Kiat Sr. Notes (10.000% due 07/01/07) 1,500,000 1,260,000
ELECTRIC - .81%
New Orleans Public Service Notes
(8.670% due 04/01/05) 1,200,000 1,211,940
MISCELLANEOUS - 3.31%
Enersis (6.600% due 12/01/26) 1,500,000 1,521,043
Gulf Canada Res (8.350% due 08/01/06) 1,500,000 1,658,242
News American Holdings (8.500% due 02/15/05) 1,600,000 1,753,409
------------
4,932,694
------------
STEELS AND METALS - 1.12%
Pohang Iron & Steel Notes
(7.125% due 11/01/06) 2,250,000 1,662,435
TELECOMMUNICATION - .74%
TCI Communications Incorporated
(8.650% due 09/15/04) 1,000,000 1,098,802
------------
Total Corporate Bonds and Notes
(cost $ 14,464,404) 14,621,440
------------
SHORT-TERM INVESTMENTS - 23.26%
COMMERCIAL PAPER - 7.43%
Ford Motor Credit Corporation
(5.510% due 01/30/98) 1,000,000 995,561
Du Pont E I De Nemours
(5.500% due 03/03/98) 2,000,000 1,981,361
Du Pont E I De Nemours
(5.470% due 06/04/98) 1,500,000 1,464,901
General Electric Capital
( 5.510% due 04/03/98) 2,000,000 1,971,838
Lockheed Martin Corporation
(5.810% due 02/23/98) 2,000,000 1,982,893
Tryon Mortgage Funding (6.350% due 05/20/01) 699,146 697,713
Walt Disney Company (5.430% due 04/13/98) 2,000,000 1,969,230
------------
11,063,497
------------
VARIABLE RATE DEMAND NOTES <FN1> - 3.47%
American Family Financial Services
(5.639% due 01/01/98) 2,593,144 2,593,144
General Mills (5.327% due 01/01/98) 150,238 150,238
Johnson Controls (5.327% due 01/01/98) 546,000 546,000
Pitney-Bowes (5.327% due 01/01/98) 70,159 70,159
Warner Lambert (5.489% due 01/01/98) 1,584,684 1,584,684
Wisconsin Electric Power Company
(5.487% due 01/01/98) 226,000 226,000
------------
5,170,225
------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION- 3.02
(5.840% due 06/18/98) 1,500,000 1,501,015
(5.710% due 06/23/98) 3,000,000 3,000,339
------------
4,501,354
------------
FEDERAL HOME LOAN
MORTGAGE CORPORATION - 1.54%
(5.885% due 05/29/98) 2,285,000 2,286,661
------------
FEDERAL HOME LOAN BANK - 7.80%
(5.720% due 06/23/98) 2,000,000 2,000,278
(5.390% due 02/11/98) 2,000,000 1,987,723
(5.135% due 03/02/98) 1,500,000 1,497,573
(6.015% due 06/05/98) 2,000,000 2,002,610
(6.010% due 05/15/98) 2,000,000 2,002,162
(5.580% due 03/18/98) 2,150,000 2,125,534
------------
11,615,880
------------
Total Short-Term Investments
(cost $34,638,561) 34,637,617
------------
TOTAL INVESTMENTS - 101.45%
(cost $142,221,878)<FN2> 150,965,858
OTHER ASSETS AND LIABILITIES - (1.45%) (2,135,988)
------------
TOTAL NET ASSETS - 100% $148,829,870
============
___________________
*Non-Income producing
(ADR) American Depository Receipt
<CAPTION>
Open Foward Currency Contracts
U.S.
Dollar Unrealized
<S> Contract Contract Appreciation Delivery
Price Value (Depreciation) Date
-------- -------- -------------- --------
<S> <C> <C> <C> <C>
Liabilities
Malaysian Ringgit (buy) 3.7023 $34,344 $ (1,531) 01/02/98
Malaysian Ringgit (buy) 3.9500 $14,202 275 01/08/98
------- --------
$48,546 $ (1,256)
======= ========
<FN>
<FN1> Interest rates vary periodically based on current market rates.
Rates shown are as of December 31, 1997. The maturity shown for each variable
rate demand note is the later of the next scheduled interest rate adjustment
date or the date on which principal can be recovered through demand.
Information shown is as of December 31, 1997.
<FN2> Represents cost for Federal income tax purposes. Gross unrealized
appreciation and depreciation of securities at December 31, 1997 for
financial reporting purposes was $12,576,088 and $3,832,106 respectively.
</FN>
</TABLE>
The accompanying notes are an integral part of
the financial statements.
<PAGE>
CARILLON FUND, INC.
SCHEDULE OF INVESTMENTS
BOND PORTFOLIO
<TABLE>
<CAPTION>
December 31, 1997
U.S. TREASURY OBLIGATIONS - 30.69% SHARES/
PRINCIPAL VALUE
---------- -----------
<S> <C> <C>
U.S. TREASURY BOND - 2.00%
6.000% due 02/15/26 $2,000,000 $ 1,997,500
-----------
U.S. TREASURY NOTES - 24.26%
6.000% due 10/15/99 4,000,000 4,022,500
6.750% due 04/30/00 2,000,000 2,045,626
7.750% due 02/15/01 2,500,000 2,645,312
5.625% due 02/28/01 2,000,000 1,996,250
5.875% due 11/15/05 5,000,000 5,026,564
7.000% due 07/15/06 5,000,000 5,398,439
6.250% due 02/15/07 3,000,000 3,096,564
-----------
24,231,255
-----------
U.S. TREASURY STRIPS - 4.43%
0.000% due 02/15/00 3,250,000 2,885,610
0.000% due 08/15/02 2,000,000 1,539,900
-----------
4,425,510
-----------
Total U.S. Treasury Obligations
(cost $29,576,632) 30,654,265
-----------
MORTGAGE-BACKED SECURITIES - 2.53%
FEDERAL HOME LOAN MORTGAGE CORPORATION- .80%
7.500% due 02/01/02 32,205 32,960
9.500% due 04/01/05 62,862 66,162
7.500% due 06/01/07 80,959 81,879
11.000% due 05/01/10 8,956 9,921
12.500% due 08/01/10 15,184 17,300
8.000% due 11/01/16 45,606 47,130
9.500% due 02/01/18 75,034 79,957
6.500% due 07/01/23 463,769 460,644
-----------
795,953
-----------
FEDERAL NATIONAL MORTGAGE ASSOCIATION - 1.59%
12.000% due 04/01/00 24,642 26,507
9.000% due 08/01/01 41,749 43,615
8.500% due 01/01/02 39,992 41,530
10.500% due 06/01/04 10,259 10,923
10.500% due 05/01/05 175,883 187,261
6.500% due 06/01/08 1,015,731 1,019,693
8.000% due 08/01/17 247,904 256,581
-----------
1,586,110
-----------
GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION - .14%
11.000% due 03/15/10 59,437 65,177
9.000% due 05/15/20 75,023 80,229
-----------
145,406
-----------
Total Mortgage-Backed Securities
(cost $2,454,904) 2,527,469
-----------
COLLATERALIZED MORTGAGE OBLIGATIONS - 4.89%
FEDERAL HOME LOAN
MORTGAGE CORPORATION - 3.19%
59-E (8.900% due 11/15/20) 1,054,610 1,104,963
106-G (8.250% due 12/15/20) 1,000,000 1,055,437
1770-B (8.250% due 01/15/24) 1,000,000 1,022,232
-----------
3,182,632
-----------
FEDERAL NATIONAL MORTGAGE ASSOCIATION - .18%
Remic 1988-30-D (9.500% due 12/25/18) 170,221 182,797
-----------
PRIVATE SECTOR - 1.52%
Securitized Asset Sales, Inc.1993-2 B2
(6.500% due 07/25/08) 286,716 283,044
CMC Securities Corp. 1993-E1E
(0.000% due 12/25/08) 355,703 274,617
Country Wide Mortgage-Backed Securities, Inc.
1994-8 B1 (6.000% due 03/01/09) 825,588 796,949
Capstead Mortgage Securities Corp. C-4
(10.950% due 02/01/14) 168,896 168,153
-----------
1,522,763
-----------
Total Collateralized Mortgage Obligations
(cost $5,516,151) 4,888,192
-----------
OTHER STRUCTURED SECURITIES - 6.25%
OTHER STRUCTURED - 6.25%
Chase Commercial Mortgage Sec.
(6.600% due 12/19/07) 2,609,885 2,488,369
Life Financial Home Loan Trust
(9.090% due 04/25/24) 2,000,000 2,017,500
NSCOR 1996-5 B1
(8.00% due 11/25/26) 1,648,468 1,735,013
-----------
Total Other Structured Securities
(cost $ 6,221,882) 6,240,882
-----------
CORPORATE BONDS AND NOTES - 49.70%
AIR TRANSPORTATION - 2.18%
Continental Airlines
(7.820% due 10/15/13) 980,392 1,047,245
NWA Trust No. 2 Class B
(10.230% due 06/21/14) 926,153 1,133,696
-----------
2,180,941
-----------
BANK & BANK HOLDING COMPANIES - 5.35%
Ahmanson Capital Trust
(8.360% due 12/01/26) 1,500,000 1,590,316
Nationsbank Corp. Notes
(7.625% due 04/15/05) 1,000,000 1,066,138
Svenska Handelsbanken
(7.125% due 03/07/07) 1,000,000 1,032,091
Zions Trust (8.536% due 12/15/26) 1,500,000 1,655,704
-----------
5,344,249
-----------
ENVIRONMENTAL SERVICES - 1.10%
Allied Waste North America
(10.250% due 12/01/06) 1,000,000 1,097,500
-----------
FINANCE COMPANIES - .80%
Arcadia Financial
(11.500% due 03/15/07) 800,000 808,000
-----------
FOOD, BEVERAGE, & TOBACCO - 2.60%
Great American Cookie Company
(10.875% due 01/15/01) 500,000 511,250
Nabisco Inc. (7.550% due 06/15/15) 1,000,000 1,062,078
RJR Nabisco, Inc. (7.625% due 09/15/03) 1,000,000 1,020,490
-----------
2,593,818
-----------
FOREIGN SOVEREIGN - 1.01%
Republic Of South Africa Notes
(8.375% due 10/17/06) 1,000,000 1,005,000
-----------
GAMING INDUSTRY - 4.08%
Alliance Gaming (10.000% due 08/01/07) 1,000,000 1,001,250
Argosy Gaming (13.2500% due 06/01/04) 1,000,000 1,045,000
Casino Magic of Louisiana
(13.000% due 08/15/03) 1,000,000 960,000
Empress River Casino Finance Corp.
(10.750% due 04/01/02) 1,000,000 1,075,000
-----------
4,081,250
-----------
GAS DISTRIBUTION - .90%
All Star Gas Corp. (7.000% due 07/15/04) 1,000,000 900,000
-----------
INSURANCE - 6.62%
Berkley (W.R.) Corp.
(9.875% due 05/15/08) 500,000 621,608
Conseco Finance (8.796% due 04/01/27) 1,500,000 1,684,019
Farmers Insurance Exhange
(8.500% due 08/01/04) 1,000,000 1,097,659
Leucadia National Corp.
(8.250% due 06/15/05) 1,000,000 1,071,378
Prudential Ins. Surplus Notes
(8.100% due 07/15/15) 1,000,000 1,070,129
USF&G Capital (8.470% due 01/10/27) 1,000,000 1,064,514
-----------
6,609,307
-----------
MANUFACTURING - 2.01%
International Knife & Saw Corp.
(11.375% due 11/15/06) 1,000,000 1,080,000
International Wire Group Inc.
(11.750% due 06/01/05) 500,000 547,500
Terex Corp. Sr. Sec. Notes
(13.250% due 05/15/02) 332,000 378,480
-----------
2,005,980
-----------
MEDIA & CABLE - 5.54%
Adelphia Communications
(12.500% due 05/15/02) 260,000 275,600
CF Cable TV Inc. (9.125% due 07/15/07) 1,000,000 1,080,000
Continental Cablevision
(8.300% due 05/15/06) 1,000,000 1,092,690
Jones Intercable, Inc. (8.875% due 04/01/07) 500,000 522,500
Peoples Choice TV (0.000% due06/01/04) 1,000,000 330,000
Spanish Broadcasting Systems
(11.000% due 03/15/04) 1,000,000 1,100,000
Turner Broadcasting Sr Notes
(8.110% due 8/15/06) 1,000,000 1,133,791
-----------
5,534,581
-----------
MEDIA CONGLOMERATE - 3.85%
News American Holdings
(9.250% due 02/01/13) 1,000,000 1,197,531
Time Warner Inc.
(8.110% due 08/15/06) 1,000,000 1,627,900
Viacom Inc Senior Notes
(7.750% due 06/01/05) 1,000,000 1,020,183
-----------
3,845,614
-----------
MISCELLANEOUS CORPORATE SERVICES - 1.08%
Neodata Services Misc. Corp. Ser.
(12.000% due 05/01/03) 1,000,000 1,075,000
-----------
OIL & GAS - DOMESTIC - .53%
Penzoil Company (9.625% due 11/15/99) 500,000 528,250
-----------
OIL & GAS - SERVICES - 2.78%
Mitchell Energy Development Corp.
(6.750% due 02/15/04) 1,750,000 1,760,244
PDV America, Inc. (7.750% due 08/01/00) 1,000,000 1,019,924
-----------
2,780,168
-----------
PAPER & FOREST PRODUCT - 1.37%
Indah Kiat Sr. Notes (10.000% due 07/01/07) 1,000,000 840,000
Westvaco Corp. (10.300% due 01/15/19) 500,000 529,600
-----------
1,369,600
-----------
RETAIL - .51%
Pamida Inc. Senior Notes
(11.750% due 03/15/03) 500,000 510,000
-----------
STEELS & METALS - .50%
Gulf States Steel 1st Mortgage
(13.500% due 04/15/03) 500,000 495,000
-----------
SUPERMARKET - .48%
Pueblo Xtra International
(9.500% due 08/01/03) 500,000 475,000
-----------
TELECOMMUNICATIONS - 6.41%
360 Communications Sr. Notes
(7.500% due 03/01/06) 1,500,000 1,557,390
Call-Net Enterprises
(0.000% due 12/01/04) 1,250,000 1,139,061
Crown Castle Sr. Notes
(0.000% due 11/15/07) 1,000,000 622,500
Dobson Communications Sr. Notes
(11.750% due 04/15/07) 1,000,000 1,056,250
Nextel Communications, Inc.
(0.000% due 09/15/07) 1,500,000 945,000
Talton Holdings Inc. Sr. Notes
(11.000% due 06/30/07) 1,000,000 1,085,000
-----------
6,405,201
-----------
Total Corporate Bonds and Notes
(cost $46,701,161) 49,644,459
-----------
COMMON STOCKS - .03%
ENERGY - .03%
Pioneer Natural Resources 916 26,507
-----------
Total Common Stocks (cost $ 24,339) 26,507
-----------
WARRANTS AND RIGHTS - 0.00%
RETAIL-FOOD - 0.00%
Great American Cookie Warrants 90 900
-----------
TECHNOLOGY - .00%
Terex Corporation Appreciation Rights 4,000 40
-----------
Total Warrants and rights(cost $ 28,050) 940
-----------
PREFERRED STOCKS - .90%
PACKAGING - .90%
Earthshell Container Corporation Series A
Cumulative Senior Convertible 8% <FN1> 500 900,000
-----------
Total Preferred Stocks (cost $500,000) 900,000
-----------
SHORT-TERM INVESTMENTS - 3.36%
VARIABLE RATE DEMAND NOTES <FN2> - 3.36%
American Family (5.639% due 01/01/98) 716,797 716,797
General Mills (5.327 due 01/01/98) 714,307 714,307
Johnson Controls Inc.
(5.327% due 01/01/98) 706,000 706,000
Pitney Bowes Credit Corp.
(5.327% due 01/01/98) 186,000 186,000
Sara Lee (5.322% due 01/01/98) 407,506 407,506
Warner Lambert (5.489% due 01/01/98) 440,230 440,230
Wisconsin Electric (5.487 due 01/01/98) 186,285 186,285
-----------
Total Short-Term Investments
(cost $3,357,125) 3,357,125
-----------
TOTAL INVESTMENTS - 98.35%
(cost $94,380,244)<3>
. 98,239,839
------------
OTHER ASSETS AND LIABILITIES - 1.65% 1,652,257
------------
TOTAL NET ASSETS - 100% $99,892,096
============
* Non-Income Producing
<FN>
<FN1> 144A- Privately placed security traded among qualified institutional
buyers.
<FN2> Interest rates vary periodically based on current market rates.
Rates shown are as of December 31, 1997. The maturity shown for each variable
rate demand note is the later of the next scheduled interest adjustment date
or the date on which principal can be recovered through demand. Information
shown is as of December 31, 1997.
<FN3> Represents cost for Federal income tax purposes. Gross unrealized
appreciation and depreciation of securities at December 31, 1997, for
financial reporting purposes was $4,636,466 and $776,871.
</FN>
</TABLE>
The accompanying notes are an integral part of
the financial statements.
CARILLON FUND, INC.
SCHEDULE OF INVESTMENTS
S&P 500 INDEX PORTFOLIO
<TABLE>
<CAPTION>
DECEMBER 31, 1997
COMMON STOCKS - 91.40%
SHARES VALUE
------ -----
<S> <C> <C>
BANKING & FINANCIAL SERVICE - 15.35%
Aetna Life & Casualty Company $ 867 $ 61,178
Ahmanson (H. F.) & Company 700 46,856
Allstate Corporation 3,100 281,713
American Express Company 3,300 294,525
American General Corporation 1,300 70,281
American International Group 4,850 527,438
Aon Corporation 1,500 87,938
Banc One Corporation 4,290 233,001
Bank of New York Incorporated 2,300 132,969
BankAmerica Corporation 4,800 350,400
Bank of Boston Corporation 900 84,544
Bankers Trust New York Corporation 500 56,219
Barnett Banks, Incorporated 1,300 93,438
Beneficial Corporation 500 41,563
Charles Schwab Corporation 2,250 94,359
Chase Manhattan Corporation 2,712 296,964
Chubb Group 1,100 83,188
CIGNA Corporation 500 86,531
Citicorp 2,300 290,806
Comerica, Incorporated 700 63,175
Conseco, Inc. 1,700 77,244
CoreStates Financial Corporation 1,400 112,088
Equifax, Incorporated 1,300 46,069
Fannie Mae 7,400 422,263
Federal Home Loan Mortgage Corporation 4,800 201,300
Fifth Third Bancorp 1,300 106,275
First Chicago NBD Corporation 2,200 183,700
First Union Corporation 3,400 174,250
Fleet Financial Group, Incorporated 1,600 119,900
General Re Corporation 500 106,000
Golden West Financial 500 48,906
Green Tree Financial Corporation 800 20,950
Hartford Financial Services Group 600 56,138
Household International, Incorporated 600 76,538
Huntington Bancshares 1,600 57,600
Jefferson-Pilot Corporation 700 54,513
Keycorp 1,400 99,138
Lincoln National Corporation 600 46,875
Loews Corporation 800 84,900
Marsh & McLennan Companies, Incorporated 1,000 74,563
MBIA Incorporated 1,000 66,813
MBNA Corporation 3,562 97,287
Mellon Bank Corporation 1,600 97,000
Merrill Lynch & Company, Incorporated 2,000 145,875
MGIC Investment 1,000 66,500
Morgan (J. P.) & Company 1,200 135,450
Morgan Stanley Group Incorporated 4,185 247,438
National City Corporation 1,400 92,050
NationsBank Corporation 3,044 185,113
Norwest Corporation 4,600 177,675
PNC Bank Corp. 2,100 119,831
Progressive Corporation 600 71,925
Providian Financial Corporation 800 36,150
Republic New York Corporation 400 45,675
SAFECO Corporation 800 39,000
State Street Corporation 1,300 75,644
St. Paul Companies 700 57,444
SunAmerica 1,500 64,125
SunTrust Banks, Incorporated 1,500 107,063
Torchmark Corp 1,200 50,475
Transamerica Corporation 500 53,250
Travelers Group, Incorporated 7,985 430,192
UNUM Corporation 1,200 65,250
U.S. Bancorp 1,579 176,749
Wachovia Corporation 1,000 81,125
Washington Mutual, Incorporated 1,920 122,520
Wells Fargo & Company 533 80,920
-----------
8,534,835
-----------
CAPITAL GOODS - 5.64%
AMP, Incorporated 1,500 63,000
Avery Dennision Company 1,100 49,225
Browning-Ferris Industries 1,300 48,100
Case Corporation 600 36,263
Caterpillar, Incorporated 2,700 131,119
Cooper Industries, Incorporated 900 44,100
Corning Inc. 1,400 51,975
Deere & Company 1,500 87,469
Dover Corporation 1,600 57,800
Eaton Corporation 500 44,625
Emerson Electric Company 3,300 186,244
Foster Wheeler Corporation 400 10,825
General Electric Company 23,200 1,702,300
Illinois Tool Works, Incorporated 1,600 96,200
Ingersoll-Rand Company 900 36,450
Johnson Controls 800 38,200
PACCAR, Incorporated 400 21,000
Parker-Hannifin Corporation 1,050 48,169
Raychem Corporation 800 34,450
Tenneco, Incorporated 1,200 47,400
Thermo Electron Corporated* 1,300 57,850
Tyco International Limited 3,600 162,225
Waste Management Incorporated 2,900 79,750
-----------
3,134,739
-----------
CONSUMER CYCLICAL - 8.38%
American Greetings Company Class A 600 23,475
AutoZone Incorporated* 1,300 37,700
Black & Decker Corporation 500 19,531
Block, H&R Inc. 700 31,369
Brunswick Corporation 700 21,215
Chrysler Corporation 4,800 168,900
Cognizant Corporation 1,000 44,563
Costco Companies Incorporated* 1,800 80,325
Dana Corporation 1,000 47,500
Dayton Hudson Corporation 1,400 94,500
Dillard's Incorporated Class A 1,100 38,775
Dow Jones, & Company, Incorporated 700 37,581
Dun & Bradstreet Corporation 1,200 37,125
Eastman Kodak Company 2,400 145,950
Federated Department Stores Incorporated* 1,300 55,981
Ford Motor Company 8,000 389,500
Gannett Company, Incorporated 2,200 135,988
Gap (The), Incorporated 2,400 85,050
General Motors Corporation 5,200 315,250
Genuine Parts Company 1,950 66,178
Goodyear Tire & Rubber Company 1,100 69,988
Harrah's Enterainment Incorporated* 700 13,213
Hilton Hotels Corporation 1,700 50,575
Home Depot, Incorporated 5,200 306,150
International Flavors
& Fragrance, Incorporated 700 36,050
ITT Corporation 700 58,013
ITT Industries Incorporated 1,100 34,513
Kmart Corporation* 2,900 33,531
Knight-Ridder Incorporated 800 41,600
Lowe's Companies 1,000 47,688
Liz Claiborne, Incorporated 700 29,269
Marriott International, Inc. 900 62,325
Masco Corporation 1,200 61,050
Mattel, Incorporated 1,850 68,913
May Department Stores Company 1,600 84,300
McGraw-Hill Companies, Incorporated 800 59,200
Mirage Resorts Incorporated 1,600 36,400
New York Times, Company Class A 800 52,900
NIKE, Incorporated Class B 1,700 66,725
Nordstrom Incorporated 700 42,263
Owens Corning Fiberglass Corporation 400 13,650
Penney, (J.C.) Company, Incorporated 1,900 114,594
Reebok International Limited* 400 11,525
Sears, Roebuck & Company 2,800 126,700
Sherwin-Williams Company 1,200 33,300
Tandy Corporation 1,000 38,563
Limited (The), Incorporated 1,790 45,645
TJX Companies Incorporated 1,500 51,563
Toys "R" Us, Incorporated* 1,700 53,444
Tribune Company 1,000 62,250
TRW, Incorporated 900 48,038
V.F. Corporation 1,000 45,938
Wal-Mart Stores, Incorporated 16,500 650,719
Whirlpool Corporation 600 33,000
Woolworth Corporation* 1,000 20,375
Xerox Corporation 2,400 177,150
-----------
4,657,576
-----------
CONSUMER NON-DURABLE - 24.22%
Abbott Laboratories 5,500 360,594
Albertson's Incorporated 1,600 75,800
American Home Products Corporation 4,500 344,250
American Stores Company 1,800 37,013
Amgen, Inc. 1,600 86,600
Anheuser-Busch Companies, Incorporated 3,500 154,000
Archer-Daniels-Midland Company 3,669 79,571
Automatic Data Processing, Incorporated 1,900 116,613
Avon Products, Incorporated 800 49,100
Baxter International Incorporated 1,700 85,742
Becton, Dickinson Company 900 45,000
Bristol-Myers Squibb Company 7,000 662,370
Boston Scientific Corporation* 1,400 64,222
Campbell Soup Company 3,300 191,800
Cardinal Health, Incorporated 1,000 75,120
CBS Incorporated 4,700 138,354
Cendant Corporation* 4,472 153,740
Clorox Company 600 47,438
Coca-Cola Company 17,700 1,179,261
Colgate-Palmolive Company 1,600 117,600
Columbia/HCA Healthcare Corporation 3,950 117,019
Comcast Corporation Class A Special 2,300 72,594
ConAgra, Incorporated 3,000 98,438
CPC International, Incorporated 900 97,200
CVS Corporation 1,400 89,688
Donnelly (R.R.) & Sons Company 1,200 44,700
Fortune Brands, Inc. 1,100 40,769
General Mills, Incorporated 1,000 71,625
Gillette Company 3,900 391,706
Guidant Corporation 1,200 74,700
Heinz (H.J.) Company 2,300 116,869
Hershey Foods Corporation 1,100 68,131
Humana Incorporated* 1,500 31,125
Interpublic Group Companies, Incorporated 900 44,831
Johnson & Johnson 9,400 619,225
Kellogg Company 2,400 119,100
King World Productions, Incorporated* 500 28,875
Kroger Company* 1,600 59,100
Lilly (Eli) & Company 7,800 543,075
Mallincrokdt Group, Incorporated 700 26,600
Manor Care, Inc. 500 17,500
McDonald's Corporation 4,900 233,975
Medtronic, Incorporated 2,800 146,475
Merck & Company, Incorporated 8,700 924,375
Newell Company 1,300 55,250
PepsiCo, Inc. 10,900 397,169
Pfizer, Incorporated 9,300 693,431
Pharmacia & Upjohn, Incorporated 3,600 131,850
Philip Morris Companies, Inc. 17,100 774,844
Pioneer Hi-Bred International 700 75,075
Procter & Gamble Company 9,600 766,200
Quaker Oats Company 1,300 68,575
Ralston-Ralston Purina Group 600 55,763
Rite Aid Corporation 900 52,819
Rubbermaid, Incorporated 1,200 30,000
Sara Lee Corporation 3,400 191,463
Schering-Plough Corporation 5,200 323,050
Seagram Company, Limited 2,200 71,088
St. Jude Medical* 500 15,250
Sysco Corporation 1,300 59,231
Tele-Communications, Incorporated* 2,000 55,875
Tenet Healthcare Corporation* 1,900 62,938
Time Warner, Incorporated 3,500 217,000
Tricon Global Restaurants* 1,090 31,678
United HealthCare Corporation 1,100 54,654
UST, Incorporated 1,200 44,325
U.S. West Media Group* 3,700 106,838
Viacom, Incorporated - Class B* 1,700 70,442
Walgreen Company 2,800 87,850
Walt Disney Company, The 4,819 477,381
Warner-Lambert Company 1,900 235,600
Wendy's International 800 19,250
Winn-Dixie Stores Incorporated 900 39,319
Wrigley, (Wm.) Jr. Company 700 55,694
-----------
13,461,785
-----------
ENERGY - 8.29%
Amerada Hess Corporation 600 32,925
Amoco Corporation 3,600 306,450
Anadarko Petroleum Corporation 600 36,413
Ashland Inc. 800 42,950
Atlantic Richfield 2,400 192,300
Baker-Hughes Incorporated 1,500 65,438
Burlington Resources, Incorporated 900 40,331
Chevron Corporation 4,700 361,900
Columbia Gas System, Incorporated 400 31,425
Dresser Industries, Incorporated 1,400 58,713
Enron Corporation 2,200 91,438
Exxon Corporation 17,900 1,095,256
Halliburton Company 1,800 93,488
Kerr-McGee Corporation 400 25,325
Mobil Corporation 5,800 418,688
Occidental Petroleum 2,000 58,625
Pennzoil Company 400 26,725
Phillips Petroleum Company 1,600 77,800
Royal Dutch Petroleum Company ADR 15,300 829,069
Schlumberger Limited 3,600 289,800
Sun Company, Incorporated 800 33,650
Texaco, Incorporated 4,000 217,500
Union Pacific Resources Group 1,592 38,606
Unocal Corporation 1,400 54,338
USX-Marathon Group 1,800 60,750
Western Atlas Incorporated* 400 29,600
-----------
4,609,503
-----------
MANUFACTURING - 7.88%
Air Products & Chemicals, Incorporated 700 57,575
Alcan Aluminum Limited 1,900 52,488
Allegheny Teledyne, Incorporated 800 20,700
Allied Signal Incorporated 3,600 140,175
Aluminum Company of America 1,400 98,525
Applied Materials Incorporated* 2,600 78,325
Barrick Gold Corporation 2,200 40,975
Bemis Company 400 17,625
Bethlehem Steel Corporation* 800 6,900
Boeing Company 7,144 349,609
Centex Corporation 100 6,294
Champion International Corporation 800 36,250
Crown Cork & Seal Company, Incorporated 800 40,100
Dow Chemical Company 2,000 203,000
DuPont (E.I.) De Nemours & Company 8,000 480,500
Eastman Chemical Company 600 35,738
Englehard Corporation 800 13,900
Fluor Corporation 700 26,163
Fort James Corporation 1,600 61,200
Freeport-McMoRan Copper 800 12,600
General Dynamics Corporation 600 51,863
Georgia-Pacific Corp. 800 48,600
Grace, (W.R.) & Company 500 40,219
Great Lakes Chemical Corporation 600 26,925
Hercules, Incorporated 700 35,044
Honeywell, Incorporated 900 61,650
Inco, Limited 1,300 22,100
International Paper Company 1,800 77,625
Kimberly-Clark Corporation 3,900 192,319
Laidlaw Incorporated 1,900 25,888
Lockheed Martin Corporation 1,400 137,900
Louisiana-Pacific Corporation 900 17,100
Mead Corporation 800 22,400
Minnesota Mining & Manufacturing Company 3,000 246,188
Monsanto Company 4,200 176,400
Morton International, Incorporated 1,000 34,375
Nalco Chemical Company 600 23,738
Newmont Mining Corporation 2,100 61,688
Northrop Grumman Corporation 600 69,000
Nucor Corporation 700 33,819
Owens-Illinois, Incorporated* 1,200 45,525
Phelps Dodge Corporation 600 37,350
Pitney-Bowes Incorporated 1,000 89,938
Placer Dome, Incorporated 1,400 17,763
PPG Industries, Incorporated 1,200 68,550
Praxair Incorporated 1,000 45,000
Reynolds Metals Company 500 30,000
Rockwell International Corporation 1,300 67,925
Rohm & Haas Company 400 38,300
Solutia Incorporated 840 22,418
Temple-Inland Inc. 500 26,156
Textron Incorporated 1,200 75,000
The Stanley Works 800 37,750
Unilever (N.V.) ADR 4,400 274,725
Union Camp Corporation 700 37,581
Union Carbide Corporation 800 34,350
United Technologies Corporation 1,600 116,500
USX-U.S. Steel Group 600 18,750
Weyerhaeuser Company 1,400 68,688
Willamette Industries 1,000 32,188
Worthington Industries, Incorporated 700 11,550
-----------
4,379,490
-----------
SERVICE - .14%
Ikon Office Solution 800 22,500
Service Corporation International 1,500 55,406
-----------
77,906
-----------
TECHNOLOGY - 11.30%
3COM Corporation* 2,600 90,838
Advanced Micro Devices, Incorporated* 900 16,144
Andrew Corporation 600 14,400
Bay Networks Inc.* 1,700 43,456
Cabletron Systems, Incorporated* 900 13,500
Cisco Systems Incorporated 7,200 401,400
COMPAQ Computers Corporation 4,970 280,494
Computer Associates International 3,900 206,213
Computer Sciences Corporation* 500 41,750
Dell Computer Corporation* 2,400 201,600
Digital Equipment Corporation* 1,000 37,000
EMC Corporation Massachusetts* 4,200 115,238
First Data Corporation 2,700 78,975
Grainger (W.W.), Incorporated 500 48,594
Hewlett-Packard Company 7,500 468,750
Intel Corporation 11,700 821,925
International Business Machines Corporation 7,100 742,394
LSI Logic Corporation* 800 15,800
Lucent Technologies 4,585 366,227
Micron Technology Incorporated* 1,300 33,800
Microsoft Corporation* 8,500 1,098,625
Motorola Incorporated 4,200 239,663
National Semiconductor* 1,200 31,125
Northern Telecom, Limited 1,900 169,100
Novell, Incorporated* 2,000 15,000
Oracle Systems Corporation* 7,000 156,187
Parametric Tech Company* 1,100 52,113
Perkin-Elmer Corporation 300 21,319
Raytheon Company - Class B 1,500 75,750
Scientfic-Atlanta Incorporated 700 11,725
Seagate Technology, Incorporated* 1,500 28,875
Silicon Graphics Incorporated* 1,200 14,925
Sun Microsystems, Incorporated* 2,700 107,663
Tektronix, Incorporated 300 11,906
Tellabs, Incorporated* 1,100 58,163
Texas Instruments, Incorporated 3,000 135,000
Unisys Corporation* 1,200 16,650
-----------
6,282,287
-----------
TRANSPORTATION - 1.17%
AMR Corporation* 600 77,100
Burlington Northern Santa Fe Corporation 1,100 102,231
Caliber System, Incorporated 400 19,475
CSX Corporation 1,600 86,400
Delta Air Lines 500 59,500
Federal Express Corp.* 700 42,744
Norfolk Southern Corp. 3,000 92,438
Ryder System Inc. 700 22,925
Southwest Airlines Company 1,500 36,938
Union Pacific Corporation 1,800 112,388
-----------
652,139
-----------
UTILITY - 9.03%
AirTouch Communications, Incorporated 3,600 149,625
ALLTELL Corporation 1,300 53,381
American Electric Power Company, Incorporated 1,600 82,600
Ameritech Corporation 3,800 305,900
AT&T Corporation 11,500 704,375
Baltimore Gas & Electric Company 1,100 37,469
Bell Atlantic Corporation 5,496 500,136
BellSouth Corporation 7,000 394,188
Carolina Power & Light Company 1,200 50,925
Central & Southwest Corporation 1,900 51,419
CINergy Corporation 1,000 38,313
Coastal Corporation 600 37,163
Consolidated Edison Co. of N.Y., Incorporated 1,400 57,400
Consolidated Natural Gas Company 600 36,300
Dominion Resources 1,400 59,588
Duke Power Company 2,339 129,522
DTE Energy Company 1,100 38,156
Edison International 2,500 67,969
Entergy Corporation 1,300 38,919
FPL Group Incorporated 2,200 130,213
General Public Utilities Corporation 900 37,913
GTE Corporation 6,100 318,725
Houston Industries, Incorporated 1,400 37,363
MCI Communications Corporation 3,200 137,000
Niagara Mohawk Power Corporation* 800 8,400
Pacific Gas & Electric Company 2,600 79,138
PacifiCorp 2,200 60,088
PECO Energy Company 1,200 29,100
Public Service Enterprises Group,
Incorporated 1,300 41,194
SBC Communications 6,455 472,829
Sonat, Incorporated 600 27,450
Southern Company 5,100 131,963
Sprint Corporation* 2,000 117,250
Texas Utilities Company 1,700 70,656
Unicom Corporation 1,400 43,050
Union Electric Company 900 38,925
U.S. West Communications Group 3,400 153,425
Williams Cos. 2,100 59,588
WorldCom, Incorporated 6,400 193,600
-----------
5,021,218
-----------
Total Common Stocks (cost $38,920,329) 50,811,478
-----------
UNIT INVESTMENT TRUST - 4.90%
S & P 500 Depository Receipts 28,100 2,727,138
-----------
Total Unit Investment Trust
(cost $2,635,730) 2,727,138
-----------
<CAPTION>
SHORT-TERM INVESTMENTS - 3.87%
PRINCIPAL VALUE
--------- -----
<S> <C> <C>
U.S. Treasury Bill (5.010% due 03/19/98) $1,780,000 1,760,507
Portico U.S. Federal Money Market Fund 388,596 388,596
-----------
Total Short-Term Investments
(cost $2,149,103) 2,149,103
-----------
TOTAL INVESTMENTS - 100.17%
(cost $43,705,162)<FN1> 55,687,719
OTHER ASSETS AND LIABILITIES - (.17%) (93,050)
-----------
TOTAL NET ASSETS - 100% $55,594,669
===========
*Non-income producing
(ADR) American Depository Receipt
<FN>
<FN1> Represents cost for Rederal income tax purposes. Gross unrealized
appreciation and depreciation of securities at December 31, 1997, was
$13,078,212 and $1,095,605 respectively.
<FN2> Securities with an aggregate market value of $1,713,425 have been
segregated with the custodian to cover margin requirements for the following
open futures contracts at December 31, 1997:
<CAPTION>
Unrealized
Unrealized Appreciation/
Type Contracts (Depreciation)
<S> <C> <C>
Standard & Poor's 500 Index (03/98) 4 $31,100
Standard & Poor's 500 Index (03/98) 1 5,650
Standard & Poor's 500 Index (03/98) 1 3,900
Standard & Poor's 500 Index (03/98) 1 6,800
$47,450
=======
</FN>
</TABLE>
The accompanying notes are an integral part of
the financial statement.
<PAGE>
CARILLON FUND, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1997
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
Carillon Fund, Inc. (the Fund) is registered under the
Investment Company Act of 1940, as amended, as a no-load,
diversified, open-end management investment company. The shares
of the Fund are sold only to The Union Central Life Insurance
Company (Union Central) and its separate accounts to fund the
benefits under certain variable insurance and retirement
products. The Fund's shares are offered in five different
series - Equity Portfolio, Capital Portfolio, Bond Portfolio,
S&P 500 Index Portfolio and Micro-Cap Portfolio. The Equity
Portfolio seeks long-term appreciation of capital by investing
primarily in common stocks and other equity securities. The
Capital Portfolio seeks the highest total return through a
combination of income and capital appreciation consistent with
the reasonable risks associated with an investment portfolio of
above-average quality by investing in equity securities, debt
instruments, and money market instruments. The Bond Portfolio
seeks a high level of current income as is consistent with
reasonable investment risk by investing primarily in long-term,
fixed-income, investment-grade corporate bonds. The S&P 500
Index Portfolio seeks investment results that correspond to the
total return performance of U.S. common stocks, as represented
in the Standard & Poor's 500 Index. The financial statements of
the Micro-Cap Portfolio are presented separately.
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.
Securities valuation - Securities held in each Portfolio, except
for short-term fixed income securities maturing in 60 days or
less, are valued as follows: Securities traded on stock
exchanges (including securities traded in both the over-the-
counter market and on an exchange), or listed on the NASDAQ
National Market System, are valued at the last sales price as of
the close of the New York Stock Exchange on the day the
securities are being valued, or, lacking any sales, at the
closing bid prices. Securities traded only in the over-the-
counter market are valued at the last bid price, as of the close
of trading on the New York Stock Exchange, quoted by brokers
that make markets in the securities. Other securities for which
market quotations are not readily available are valued at fair
value as determined in good faith under procedures adopted by
the Board of Directors. Short-term fixed income securities with
a remaining maturity of 60 days or less held in each Portfolio
are valued at amortized cost which approximates market. Non-U.S.
dollar securities are translated into U.S. dollars using the
spot exchange rate provided at the close of the London market.
Securities transactions and investment income - Securities
transactions are recorded on the trade date (the date the order
to buy or sell is executed). Dividend income is recorded on the
ex-dividend date and interest income is recorded on the accrual
basis. All amortization of discount is recognized currently
under the effective interest method. Gains and losses on sales
of investments are calculated on the identified cost basis for
financial reporting and tax purposes.
Federal taxes - It is the intent of the Fund to comply with the
requirements of the Internal Revenue Code applicable to
regulated investment companies and to distribute all of its net
investment income and any net realized capital gains. Regulated
investment companies owned by the segregated asset accounts of a
life insurance company, held in connection with variable annuity
contracts, are exempt from excise tax on undistributed income.
Therefore, no provision for income or excise taxes has been
recorded.
Distributions -Distributions from net investment income in all
Portfolios are declared and paid quarterly. Net realized
capital gains are distributed periodically, no less frequently
than annually. Distributions are recorded on the ex-dividend
date. All distributions are reinvested in additional shares of
the respective Portfolio at the net asset value per share.
The amount of distributions are determined in accordance with
federal income tax regulations which may differ from generally
accepted accounting principles. These "book/tax" differences
are either considered temporary or permanent in nature. To the
extent these differences are permanent in nature, such amounts
are reclassified within the capital accounts based on their
federal tax-basis treatment; temporary differences do not
require reclassification. Distributions which exceed net
investment income and net realized capital gains for financial
reporting purposes but not for tax purposes are reported as
distributions in excess of net investment income or
distributions in excess of net realized capital gains. To the
extent they exceed net investment income and net realized
capital gains for tax purposes, they are reported as
distributions of paid-in-capital.
Expenses - Allocable expenses of the Fund are charged to each
Portfolio based on the ratio of the net assets of each Portfolio
to the combined net assets of the Fund. Nonallocable expenses
are charged to each Portfolio based on specific identification.
Foreign Currency - The Funds' accounting records are maintained
in U.S. dollars. All Portfolios may purchase foreign securities
within certain limitations set forth in the Prospectus. Amounts
dominated in or expected to settle in foreign currencies are
translated into U.S. dollars at the spot rate at the close of
the London Market. The fund does not isolate that portions of
the results of operations resulting from changes in foreign
exchange rates on investments from the underlying fluctuation in
the securities resulting from market prices. All are included in
net realized and unrealized gain or loss for investments.
NOTE 2 - TRANSACTIONS WITH AFFILIATES
Investment advisory fees - The Fund pays investment advisory
fees to Carillon Advisers, Inc. (the Adviser), under terms of an
Investment Advisory Agreement (the Agreement). Certain officers
and directors of the Adviser are affiliated with the Fund. The
Fund pays the Adviser, as full compensation for all services and
facilities furnished, a monthly fee computed separately for each
Portfolio on a daily basis, at an annual rate, as follows:
(a) for the Equity Portfolio - .65% of the first $50,000,000,
.60% of the next $100,000,000, and .50% of all over
$150,000,000 of the current net asset value:
(b) for Capital Portfolio - .75% of the first $50,000,000,
.65% of the next $100,000,000, and .50% of all
over $150,000,000 of the current net asset value.
(c) for the Bond Portfolio - .50% of the first $50,000,000,
.45% of the next $100,000,000, and .40% of all over
$150,000,000 of the current net asset value.
(d) for the S&P 500 Index Portfolio - .30% of the current net
asset value.
The Agreement provides that if the total operating expenses of
the Fund, exclusive of the advisory fee and certain other
expenses as described in the Agreement, for any fiscal quarter
exceed an annual rate of 1% of the average daily net assets of
the Equity, Capital , or Bond Portfolios, the Adviser will
reimburse the Fund for such excess, up to the amount of the
advisory fee for that year. The Adviser has agreed to waive its
advisory fee and pay any other expenses of the S&P 500 Index
Portfolio to the extent that such expenses exceed 0.60% of its
average annual net assets.
In addition to providing investment advisory services, the
Adviser is responsible for providing certain administrative
functions to the Fund. The Adviser has entered into an
Administration Agreement with Carillon Investments, Inc. (the
Distributor) under which the Distributor furnishes substantially
all of such services for an annual fee of .20% of the Fund's
average net assets for the Equity, Capital, and Bond Portfolios,
and .05% of the Fund's average net assets for the S&P 500 Index
Portfolio. The fee is borne by the Adviser, not the Fund.
Carillon Advisers, Inc. and Carillon Investments, Inc. are
wholly-owned subsidiaries of Union Central.
Directors' fees - Each director who is not affiliated with the
Adviser receives fees from the Fund for service as a director.
Members of the Board of Directors who are not affiliated with
the Adviser are eligible to participate in a deferred
compensation plan. The value of each director's deferred
compensation account will increase or decrease at the same rate
as if it were invested in shares of the Scudder Money Market
Fund.
NOTE 3 - FUTURES AND FOREIGN CURRENCY CONTRACTS
S&P 500 Index Portfolio ("Index") may purchase futures contracts
on the Standard & Poor's 500 Stock Index. These contracts
provide for the sale of a specified quantity of a financial
instrument at a fixed price at a future date. When Index enters
into a futures contract, it is required to deposit and maintain
as collateral such initial margin as required by the exchange on
which the contract is traded. Under terms on the contract,
Index agrees to receive from or pay to the broker an amount
among equal to the daily fluctuation in the value of the
contract (known as the variation margin). The variation margin
is recorded as unrealized gain or loss until the contract
expires or is otherwise closed, at which time the gain or loss
is realized. Index invests in futures as a substitute to
investing in the 500 common stock positions in the Standard &
Poor's 500 Index. The potential risk to Index is that the
change in the value in the underlying securities may not
correlate to the value of the contracts.
All portfolios may enter into forward foreign currency exchange
contacts for the purchase or sale of a specific foreign currency
at a fixed price on a future date. Risks may arise upon entering
these contracts from the potential inability of counter-parties
to meet the terms of their contracts and from unanticipated
movements in their value of a foreign currency relative to the
U.S. dollar. The funds typically utilize the contracts as a
hedge against fluctuation in currency values between the trade
and settlement dates of security transactions.
NOTE 4 - SUMMARY OF PURCHASES AND SALES OF INVESTMENTS
Purchases and sales of securities for the year ended
December 31, 1997 excluding short-term obligations, follow:
<TABLE>
<CAPTION>
S&P 500
Equity Capital Bond Index
Portfolio Portfolio Portfolio Portfolio
------------ ----------- ------------ -----------
<S> <C> <C> <C> <C>
Total Cost
of Purchases of:
Common Stocks $162,918,331 $42,264,597 $ 0 $18,676,744
U.S. Government Securities ---- 18,655,608 7,189,738 ----
Corporate Bonds ---- 12,634,953 95,814,662 ----
------------ ----------- ------------ -----------
$165,918,331 $73,555,158 $103,004,400 $18,676,744
============ =========== ============ ===========
Total Proceeds
from Sales of:
Common Stocks $178,560,062 $48,660,638 $ 515,027 $ 3,555,261
U.S. Government Securities ---- 20,622,525 9,513,172 ----
Corporate Bonds ---- 4,910,848 85,986,934 ----
------------ ----------- ------------ -----------
$178,560,062 $74,194,011 $ 96,015,133 $ 3,555,261
============ =========== ============ ===========
</TABLE>
<PAGE>
Carillon Fund, Inc.
NOTES TO FINANCIAL STATEMENTS
Note 5 - FINANCIAL HIGHLIGHTS
Computed on the basis of a share of capital stock outstanding
throughout the year.
<TABLE>
<CAPTION>
Equity Portfolio
Year Ended December 31
--------------------------------------------
1997 1996 1995 1994 1993
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Year $ 19.45 $ 16.54 $ 14.30 $ 14.58 $ 13.74
-------- -------- -------- -------- --------
Investment Activities:
Net investment income .23 .29 .24 .20 .16
Net realized and unrealized 3.23 3.61 3.36 .31 1.69
gains/(losses) -------- -------- -------- -------- --------
Total from
Investment Operations 3.46 3.90 3.60 .51 1.85
-------- -------- -------- -------- --------
Distributions:
Net investment income (.27) (.27) (.23) (.19) (.16)
Net realized gains (2.29) (.72) (1.13) (.60) (.85)
-------- -------- -------- -------- --------
Total Distributions (2.56) (.99) (1.36) (.79) (1.01)
-------- -------- -------- -------- --------
Net Asset Value,
End of year $20.35 $19.45 $16.54 $14.30 $14.58
======== ======== ======== ======== ========
Total Return 20.56% 24.52% 26.96% 3.42% 14.11%
Ratios/Supplemental Data:
Ratio of Expenses to
Average Net Assets .62% .64% .66% .69% .70%
Ratio of Net Investment
Income to Average Net Assets 1.23% 1.66% 1.73% 1.45% 1.18%
Portfolio Turnover Rate 57.03% 52.53% 34.33% 40.33% 37.93%
Average Commission
Rate Paid <FN1> $.0600 $.0628
Net Assets,
End of Year (000's) $335,627 $288,124 $219,563 $157,696 $138,239
<FN>
<FN1> Represents the dollar amount of commissions paid on Portfolio
transactions divided by the total number of shares purchased and sold for which
commissions were charged. Disclosure not required for periods prior to fiscal
1996.
</FN>
</TABLE>
<PAGE>
Carillon Fund, Inc.
NOTES TO FINANCIAL STATEMENTS
Note 5 - FINANCIAL HIGHLIGHTS
Computed on the basis of a share of capital stock
outstanding throughout the year.
<TABLE>
<CAPTION>
Capital Portfolio
Year Ended December 31,
--------------------------------------------
1997 1996 1995 1994 1993
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of year $ 14.95 $ 13.72 $ 13.19 $ 13.81 $ 12.99
-------- -------- -------- -------- --------
Investment Activities:
Net investment income .62 .63 .64 .52 .43
Net realized and unrealized .37 1.36 1.15 (.39) 1.17
gains/(losses) -------- -------- -------- -------- --------
Total from
Investment Activities .99 1.99 1.79 .13 1.60
-------- -------- -------- -------- --------
Distributions:
Net investment income (.66) (.57) (.64) (.52) (.42)
Net realized gains (1.18) (.19) (.62) (.23) (.36)
-------- -------- -------- -------- --------
Total Distributions (1.84) (.76) (1.26) (.75) (.78)
-------- -------- -------- -------- --------
Net Asset Value,
End of year $14.10 $14.95 $13.72 $13.19 $13.81
======== ======== ======== ======== ========
Total Return 7.40% 14.94% 14.28% .94% 12.72%
Ratios/Supplemental Data:
Ratio of Expenses to
Average Net Assets .77% .77% .77% .80% .82%
Ratio of Net Investment
Income to Average Net Assets 4.22% 4.42% 4.99% 4.25% 3.31%
Portfolio Turnover Rate 60.84% 53.11% 43.83% 41.89% 32.42%
Average Commission
Rate Paid <FN1> $.0531 $.0615
Net Assets,
End of Year (000's) $148,833 $159,294 $145,623 $119,263 $100,016
<FN>
<FN1> Represents the dollar amount of commissions paid on Portfolio
transactions divided by the total number of shares purchased and sold for
which commissions were charged. Disclosure not required for periods prior to
fiscal 1996.
</FN>
</TABLE>
<PAGE>
Carillon Fund, Inc.
NOTES TO FINANCIAL STATEMENTS
Note 5 - FINANCIAL HIGHLIGHTS
Computed on the basis of a share of capital stock outstanding
throughout the period.
<TABLE>
<CAPTION>
Bond Portfolio
Year Ended December 31,
--------------------------------------------
1997 1996 1995 1994 1993
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Year $ 10.91 $ 11.07 $ 10.04 $ 11.30 $ 10.91
-------- -------- -------- -------- --------
Investment Activities:
Net investment income .78 .79 .88 .77 .73
Net realized and unrealized .38 (.04) .98 (.95) .54
gains/(losses) -------- -------- -------- -------- --------
Total from
Investment Operations 1.16 .75 1.86 (.18) 1.27
-------- -------- -------- -------- --------
Distributions:
Net investment income (.72) (.87) (.83) (.78) (.73)
In excess of
net investment income ---- (.04) ---- ---- ----
Net realized gains (.06) ---- ---- (.30) (.15)
-------- -------- -------- -------- --------
Total Distributions (.78) (.91) (.83) (1.08) (.88)
-------- -------- -------- -------- --------
Net Asset Value,
End of period $ 11.29 $ 10.91 $ 11.07 $ 10.04 $ 11.30
-------- -------- -------- -------- --------
Total Return 11.02% 7.19% 19.03% (1.63%) 11.94%
Ratios/Supplemental Data:
Ratio of Expenses to
Average Net Assets .60% .62% .65% .68% .66%
Ratio of Net Investment
Income to Average Net Assets 7.15% 7.24% 7.43% 7.21% 6.65%
Portfolio Turnover Rate 113.41% 202.44% 111.01% 70.27% 137.46%
Net Assets,
End of Year (000's) $ 99,892 $ 85,634 $ 73,568 $ 55,929$ 54,128
</TABLE>
<PAGE>
Carillon Fund, Inc.
NOTES TO FINANCIAL STATEMENTS
Note 5 - FINANCIAL HIGHLIGHTS
Computed on the basis of a share of capital stock outstanding
throughout the year.
<TABLE>
<CAPTION>
S&P 500 INDEX PORTFOLIO
Year Ended December 31,
1997 1996<FN1>
------- -------
<S> <C> <C>
Net Asset Value,
Beginning of year $ 12.13 $ 10.00
------- -------
Investment Activities:
Net investment income .20 .20
Net realized and unrealized 3.72 2.12
gains/(losses) ------- -------
Total from Investment Activities 3.92 2.32
------- -------
Distributions:
Net investment income (.21) (.19)
Net realized gains (.10) ---
------- -------
Total Distributions (.31) (.19)
Net Asset Value,
End of year $ 15.74 $ 12.13
======= =======
Total Return 32.72% 23.37%
Ratios/Supplemental Data:
Ratio of Net Expenses to
Average Net Assets .50% .59%<FN2>
Ratio of Net Investment
Income to Average Net Assets 1.48% 2.14%<FN2>
Portfolio Turnover Rate 9.06% 1.09%
Average Commission Rate Paid <FN3> $ .0453 $ .0601
Net Assets, End of Year (000's) $55,595 $29,205
<FN>
<FN1> The portfolio commenced operation on December 29, 1995. The financial
highlights table for the period ending December 31, 1995 is not presented
because the activity for the period did not round to $0.01 in any category of
the reconciliation of beginning to ending net asset value per share. The
ratios and total return were all less than 0.1%. The net assets at December
31, 1995 were $305,148.
<FN2> The ratios of net expenses to average net assets would have increased
and net investment income to average net assets would have decreased by .25%
for the six months ended December 31, 1996, had the Adviser not waived a
portion of its fee.
<FN3> Represents the dollar amount of commissions paid on Portfolio
transactions divided by the total number of shares purchased and sold for
which commissions were charged. Disclosure not required for periods prior to
fiscal 1996.
</FN>
</TABLE>
<PAGE>
Report of Independent Auditors
To the Board of Trustees and Shareholders of Carillon Fund, Inc.
We have audited the accompanying statements of assets and
liabilities, including the schedules of investments, of Carillon
Fund, Inc., consisting of the Equity Portfolio, Capital
Portfolio, Bond Portfolio and the S&P 500 Index Portfolio, as of
December 31, 1997, and the related statements of operations for
the year then ended, the statements of changes in net assets for
the years ended December 31, 1997 and December 31, 1996,
respectively, and financial highlights for the periods ended
December 31, 1997, December 31, 1996 and December 31, 1995,
respectively. These financial statements and financial
highlights ("financial statements") are the responsibility of
the Fund's management. Our responsibility is to express an
opinion on these financial statements based on our audits. The
financial highlights presented for periods prior to December 31,
1995 were audited by other auditors.
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 are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting
the amounts and disclosure in the financial statements. Our
procedures included confirmation of securities owned as of
December 31, 1997, by correspondence with the Funds' 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, such financial statements present fairly, in all
material respects, the financial position of each of the Funds
as of December 31, 1997, the results of their operations for the
year then ended, and the changes in their net assets and the
financial highlights for the respective stated periods in
conformity with generally accepted accounting principles.
/s/ Deloitte & Touche LLP
Deloitte & Touche LLP
Dayton, Ohio
February 12, 1998
CARILLON FUND, INC.
MICRO-CAP PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1997
<TABLE>
<CAPTION>
COMMON STOCKS - 97.78%
SHARES VALUE
------ -----
<S> <C> <C>
BANKING & FINANCIAL SERVICE - 14.81%
Duff & Phelps Credit Rating Company 2,300 $ 93,437
Fahnestock Viner Holdings Class-A 4,300 74,981
Jefferies Group, Incorporated 2,200 90,062
Mid-Iowa Financial* 7,700 88,550
Warren Bancorp, Incorporated* 4,100 94,300
----------
441,330
----------
CAPITAL GOODS - 8.11%
Franklin Electric Company Incorporated* 1,400 89,950
Mitcham Industries ,Incorporated* 6,000 73,000
Petroleum Helicopters (non-voting)* 3,500 78,750
----------
241,700
----------
CONSUMER CYCLICAL - 20.67%
CPAC, Incorporated 7,600 77,900
Maxwell Shoe Company Incorporated - A* 6,000 64,500
NCI Building Systems, Incorporated* 2,100 74,550
Quaker Fabric Corporation* 4,000 78,500
Strattec Security Corporation* 3,200 81,600
Supreme International Corporation* 6,900 86,250
Winsloew Furniture, Incorporated* 5,400 78,300
World of Science, Incorporated* 17,000 74,375
----------
615,975
----------
CONSUMER NON-DURABLE - 17.94%
Complete Management Incorporated* 4,800 67,200
Mesa Laboratories, Incorporated* 11,000 74,250
Nam Tai Electronics, Incorporated* 4,700 70,206
Norland Medical Systems, Incorporated* 10,500 78,750
Orthofix International N.V. 6,300 74,025
Schlotzsky's, Incorporated* 4,500 65,813
Young Innovations, Incorporated* 5,800 104,400
----------
534,644
----------
ENERGY - 8.14%
Callon Petroleum Company* 4,300 70,009
Domain Energy Corporation* 4,600 72,450
OYO Geospace Corporation* 5,300 100,038
----------
242,497
----------
MANUFACTURING - 16.23%
Cannondale Corporation* 3,800 $ 82,650
Fibermark, Incorporated* 4,100 88,150
Northwest Pipe Company* 3,600 86,400
NS Group, Incorporated* 3,400 58,225
Omniquip International, Incorporated 4,400 87,725
York Group, Incorporated 3,300 80,438
----------
483,588
----------
TECHNOLOGY - 9.34%
DRS Technologies, Incorporated* 6,700 98,825
Vertex Communications Corporation* 3,300 79,613
Vtech Holdings Limited Sponsored ADR 3,400 100,267
----------
278,705
----------
TRANSPORTATION - 2.54%
MTL Incorporated* 3,000 75,750
----------
Total Common Stocks (cost $ 2,930,045) 2,914,189
----------
SHORT-TERM INVESTMENTS - 3.64%
<CAPTION>
PRINCIPAL VALUE
--------- ----------
<S> <C> <C>
VARIABLE RATE DEMAND NOTES <F1>- 3.64%
Johnson Controls (5.327% due 01/01/98) $ 37,511 $ 37,511
Pitney Bowes (5.327% due 01/01/98) 26,926 26,926
Sara Lee (5.322% due 01/01/98) 30,000 30,000
Warner Lambert (5.489 due 01/01/98) 14,022 14,022
----------
Total Short-Term Investments
(cost $108,459) 108,459
----------
TOTAL INVESTMENTS - 101.42%
(cost $3,038,504) <F2> 3,022,648
OTHER ASSETS AND LIABILITIES - (1.42%) (42,258)
----------
TOTAL NET ASSETS - 100% $2,980,390
==========
_________
*Non-income producing
(ADR) American Depository Receipt
<FN>
<F1> Interest rates vary periodically based on current market rates.
The maturity shown for each variable rate demand note is the later of
the next scheduled interest rate adjustment date or the date on which
principal can be recovered through demand. Information as of December
31, 1997.
<F2> Represents cost for Federal income tax purposes. Gross unrealized
appreciation and depreciation of securities at December 31, 1997 was
$134,760 and $(150,616), respectively.
</FN>
</TABLE>
The accompanying notes are an integral part of
the financial statements.
<PAGE>
CARILLON FUND, INC.
MICRO-CAP PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
December 31, 1997
<S> <C>
ASSETS
Investment in securities, at value -
(Amortized cost $3,038,504) $ 3,022,648
Receivables:
Interest & dividends 1,022
Expense reimbursement
from Carillon Advisers, Inc. 6,489
-----------
3,030,159
-----------
LIABILITIES
Payables:
Investment Securities purchased 36,750
Accrued expenses and other 13,019
-----------
49,769
-----------
NET ASSETS
Paid-in capital 2,996,246
Net unrealized depreciation on investments (15,856)
-----------
$ 2,980,390
===========
Shares authorized ($.10 par value) 20,000,000
Shares outstanding 300,000
Net asset value, offering
and redemption price per share $ 9.93
</TABLE>
The accompanying notes are an integral part of
the financial statements.
<PAGE>
CARILLON FUND, INC.
MIRCO-CAP PORTFOLIO
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
For the Period
From November 24, 1997
to December 31, 1997
----------------------
<S> <C>
INVESTMENT INCOME:
Interest $ 2,417
Dividends 304
--------
2,721
--------
EXPENSES:
Investment advisory fee 3,237
Professional fees 8,216
Portfolio accounting fees 2,505
Director's fees 540
Custodial fees and expenses 573
Other 1,130
--------
16,201
Less expenses reimbursed by the advisor (9,726)
--------
6,475
--------
NET INVESTMENT LOSS (3,754)
--------
NET CHANGE IN UNREALIZED
DEPRECIATION ON INVESTMENTS (15,856)
--------
NET DECREASE IN NET ASSETS FROM OPERATIONS $(19,610)
========
</TABLE>
The accompanying notes are an integral part of
the financial statements.
<PAGE>
CARILLON FUND, INC.
MICRO-CAP PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
For the Period
From November 24, 1997
to December 31, 1997
<S> <C>
OPERATIONS:
Net investment loss $ (3,754)
Net change in unrealized depreciation
on investments (15,856)
----------
(19,610)
----------
FUND SHARE TRANSACTIONS-
Proceeds from shares sold 3,000,000
----------
NET INCREASE IN NET ASSETS 2,980,390
----------
NET ASSETS:
Beginning of period ----
----------
End of period $2,980,390
==========
FUND SHARE TRANSACTIONS-
Sold 300,000
==========
</TABLE>
The accompanying notes are an integral part of
the financial statements.
<PAGE>
CARILLON FUND, INC.
MICRO-CAP PORTFOLIO
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1997
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
The Micro-Cap Portfolio (Micro-Cap) of Carillon Fund, Inc. (the
Fund) is registered under the Investment Company Act of 1940, as
amended, as a no-load, diversified, open-end management
investment company. The shares of the Fund are sold only to The
Union Central Life Insurance Company (Union Central) and its
separate accounts to fund the benefits under certain variable
insurance and retirement products. The Fund's shares are
offered in five different series - Equity Portfolio, Capital
Portfolio, Bond Portfolio, S&P 500 Index Portfolio and Micro-Cap
Portfolio. Micro-Cap seeks long-term appreciation by investing
primarily in the common stocks of domestic companies with
smaller market capitalization. The financial statements of the
Equity, Bond, Capital and S&P 500 Index Portfolios are presented
separately.
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.
Securities valuation - Securities except for short-term fixed
income securities maturing in 60 days or less, are valued as
follows: Securities traded on stock exchanges (including
securities traded in both the over-the-counter market and on an
exchange), or listed on the NASDAQ National Market System, are
valued at the last sales price as of the close of the New York
Stock Exchange on the day the securities are being valued, or,
lacking any sales, at the closing bid prices. Securities traded
only in the over-the-counter market are valued at the last bid
price, as of the close of trading on the New York Stock
Exchange, quoted by brokers that make markets in the securities.
Other securities for which market quotations are not readily
available are valued at fair value as determined in good faith
under procedures adopted by the Board of Directors. Short-term
fixed income securities with a remaining maturity of 60 days or
less held in each Portfolio are valued at amortized cost which
approximates market. Non-U.S. dollar securities are translated
into U.S. dollars using the spot exchange rate at the close of
the London market.
Securities transactions and investment income - Securities
transactions are recorded on the trade date (the date the order
to buy or sell is executed). Dividend income is recorded on the
ex-dividend date and interest income is recorded on the accrual
basis. All amortization of discount is recognized currently
under the effective interest method. Gains and losses on sales
of investments are calculated on the identified cost basis for
financial reporting and tax purposes.
Federal taxes - It is Micro-Cap's intent to comply with the
requirements of the Internal Revenue Code applicable to
regulated investment companies and to distribute all of its net
investment income and any net realized capital gains. Regulated
investment companies owned by the segregated asset accounts of a
life insurance company, held in connection with variable annuity
contracts, are exempt from excise tax on undistributed income.
Therefore, no provision for income or excise taxes has been
recorded.
Distributions - Distributions from net investment income are
declared and paid quarterly. Net realized capital gains are
distributed periodically, no less frequently than annually.
Distributions are recorded on the ex-dividend date. All
distributions are reinvested in additional shares at the net
asset value per share.
The amount of distributions are determined in accordance with
federal income tax regulations which may differ from generally
accepted accounting principles. These "book/tax" differences
are either considered temporary or permanent in nature. To the
extent these differences are permanent in nature, such amounts
are reclassified within the capital accounts based on their
federal tax-basis treatment; temporary differences do not
require reclassification. Distributions which exceed net
investment income and net realized capital gains for financial
reporting purposes but not for tax purposes are reported as
distributions in excess of net investment income or
distributions in excess of net realized capital gains. To the
extent they exceed net investment income and net realized
capital gains for tax purposes, they are reported as
distributions of paid-in-capital.
Expenses - Allocable expenses of the Fund are charged to each
Portfolio based on the ratio of the net assets of each Portfolio
to the combined net assets of the Fund. Nonallocable expenses
are charged to each Portfolio based on specific identification.
Foreign Currency - The Fund's accounting records are maintained
in U.S. dollars. All Portfolios may purchase foreign securities
within certain limitations set forth in the Prospectus. Amounts
dominated in or expected to settle in foreign currencies are
translated into U.S. dollars at the spot rate reported at the
close of the London market. The Fund does not isolate that
portion of the results of operations resulting from changes in
foreign exchange rates on investments from the underlying
fluctuation in the securities resulting from market prices. All
are included in net realized and unrealized gain or loss for
investments.
NOTE 2 - TRANSACTIONS WITH AFFILIATES
Investment advisory fees - Micro-Cap pays investment advisory
fees to Carillon Advisers, Inc. (the Adviser), under terms of an
Investment Advisory Agreement (the Agreement). Certain officers
and directors of the Adviser are affiliated with the Fund. The
Fund pays the Adviser, as full compensation for all services and
facilities furnished, a monthly fee computed on a daily basis,
at an annual rate of 1.0% of net assets.
The Adviser has agreed to limit expenses of the Fund to 2% of
the average annual net assets.
In addition to providing investment advisory services, the
Adviser is responsible for providing certain administrative
functions to the Fund. The Adviser has entered into an
Administration Agreement with Carillon Investments, Inc. (the
Distributor) under which the Distributor furnishes substantially
all of such services for an annual fee of .10% of the Fund's
average net assets. The fee is borne by the Adviser not the
Fund.
Carillon Advisers, Inc. and Carillon Investments, Inc. are
wholly-owned subsidiaries of Union Central.
Directors' fees - Each director who is not affiliated with the
Adviser receives fees from the Fund for service as a director.
Members of the Board of Directors who are not affiliated with
the Adviser are eligible to participate in a deferred
compensation plan. The value of each director's deferred
compensation account will increase or decrease at the same rate
as if it were invested in shares of the Scudder Money Market
Fund.
NOTE 3 - FORWARD CURRENCY CONTRACTS
All portfolios may enter into forward foreign currency exchange
contacts for the purchase or sale of a specific foreign currency
at a fixed price on a future date. Risks may arise upon entering
these contracts from the potential inability of counter-parties
to meet the terms of their contracts and from unanticipated
movements in their value of a foreign currency relative to the
U.S. dollar. The funds typically utilize the contracts as a
hedge against fluctuation in currency values between the trade
and settlement dates of security transactions.
NOTE 4 - SUMMARY OF PURCHASES AND SALES OF INVESTMENTS
Micro-Cap has purchased $2,930,045 and had no sales of
securities for the period ended December 31, 1997, excluding
short-term obligations.
<PAGE>
CARILLON FUND, INC.
MICRO-CAP PORTFOLIO
NOTES TO FINANCIAL STATEMENTS
Note 5 - FINANCIAL HIGHLIGHTS
Computed on the basis of a share of capital stock outstanding
throughout the period.
<TABLE>
<CAPTION>
For the Period
From November 24, 1997
to December 31, 1997
----------------------
1997
----
<S> <C>
Net Asset Value,
Beginning of Year $ 10.00
Investment Activities:
Net investment income (loss) (.01)
Net realized and unrealized (.06)
gains/(losses) ---------
Total from Investment Operations (.07)
---------
Distributions:
Net investment income ----
Net realized gains ----
Total Distributions ----
----------
Net Asset Value,
End of Year $ 9.93
----------
Total Return (0.7%)
Ratios/Supplemental Data:
Ratio of Net Expenses to
Average Net Assets 2.00% <F1>
Ratio of Net Investment loss
to Average Net Assets (1.16%) <F1>
Portfolio Turnover Rate ----
Average Commission Rate Paid <F2> $ .0600
Net Assets, End of Year (000's)
$ 2,980
<FN>
<F1> The ratios of net expenses to average net assets would have increased
and net investment income to average net assets would have decreased by 3.00%
for the period ended December 31, 1997, had the Adviser not reimbursed
expenses. These ratios are annualized.
<F2> Represents the dollar amount of commissions paid on Portfolio
transactions divided by the total number of shares purchased and sold for
which commissions were charged.
</FN>
</TABLE>
Independent Auditors' Report
To the Board of Trustees and Shareholders of
Micro-Cap Portfolio
We have audited the accompanying statement of assets and
liabilities of the Micro-Cap Portfolio of Carillon Fund, Inc.
(the "Fund"), as of December 31, 1997, the related statement of
operations, and the statement of changes in net assets for the
period from November 24, 1997 (date of inception) to December
31, 1997. These financial statements are the responsibility of
the Fund's management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit 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 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, 1997, by correspondence with the Fund's 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 audit provides a reasonable basis for our
opinion.
In our opinion, such financial statements present fairly, in all
material respects, the financial position of the Micro-Cap
Portfolio, as of December 31, 1997, and the results of its
operations, the changes in its net assets, and the financial
highlights for the period presented, in conformity with generally
accepted accounting principles.
/s/ Deloitte & Touche LLP
Deloitte & Touche LLP
Dayton, Ohio
February 12, 1998
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000743773
<NAME> CARILLON FUND, INC.
<SERIES>
<NUMBER> 2
<NAME> CARILLON EQUITY PORTFOLIO
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<INVESTMENTS-AT-COST> 259,127,836
<INVESTMENTS-AT-VALUE> 330,299,046
<RECEIVABLES> 7,292,894
<ASSETS-OTHER> 25,213
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 337,617,153
<PAYABLE-FOR-SECURITIES> 1,796,837
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 192,856
<TOTAL-LIABILITIES> 1,989,693
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 220,719,673
<SHARES-COMMON-STOCK> 0
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 231,700
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 43,504,877
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 71,171,210
<NET-ASSETS> 335,627,460
<DIVIDEND-INCOME> 4,247,554
<INTEREST-INCOME> 1,523,662
<OTHER-INCOME> 0
<EXPENSES-NET> 1,930,832
<NET-INVESTMENT-INCOME> 3,840,384
<REALIZED-GAINS-CURRENT> 43,526,118
<APPREC-INCREASE-CURRENT> 10,788,049
<NET-CHANGE-FROM-OPS> 58,154,551
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 4,343,382
<DISTRIBUTIONS-OF-GAINS> 34,344,113
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,441,326
<NUMBER-OF-SHARES-REDEEMED> 2,041,013
<SHARES-REINVESTED> 2,276,903
<NET-CHANGE-IN-ASSETS> 47,503,737
<ACCUMULATED-NII-PRIOR> 734,698
<ACCUMULATED-GAINS-PRIOR> 34,322,872
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,731,351
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,930,832
<AVERAGE-NET-ASSETS> 311,402,288
<PER-SHARE-NAV-BEGIN> 19.45
<PER-SHARE-NII> 0.23
<PER-SHARE-GAIN-APPREC> 3.23
<PER-SHARE-DIVIDEND> 0.27
<PER-SHARE-DISTRIBUTIONS> 2.29
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 20.35
<EXPENSE-RATIO> 0.006
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0.00
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000743773
<NAME> CARILLON FUND, INC.
<SERIES>
<NUMBER> 4
<NAME> CAPITAL PORTFOLIO
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<INVESTMENTS-AT-COST> 142,221,876
<INVESTMENTS-AT-VALUE> 150,965,858
<RECEIVABLES> 2,291,049
<ASSETS-OTHER> 14,032
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 153,270,939
<PAYABLE-FOR-SECURITIES> 4,320,618
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 120,451
<TOTAL-LIABILITIES> 4,441,069
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 132,294,897
<SHARES-COMMON-STOCK> 0
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 541,406
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 7,249,585
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 8,743,982
<NET-ASSETS> 148,829,870
<DIVIDEND-INCOME> 1,428,148
<INTEREST-INCOME> 6,383,812
<OTHER-INCOME> 0
<EXPENSES-NET> 1,202,040
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