MONTEREY MUTUAL FUND, N-30D, 2000-01-28

MONTEREY MUTUAL FUND
N-30D, 2000-01-28

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MONTEREY
FUNDS

- OCM GOLD
- CAMBORNE GOVERNMENT INCOME
- PIA EQUITY

MONTEREY
MUTUAL
FUND

ANNUAL REPORT
NOVEMBER 30, 1999

<PAGE>

Dear Shareholder:

We are pleased to provide you with this annual report for the year ended
November 30, 1999 for the following series of the Monterey Mutual Funds: the OCM
Gold Fund, the Camborne Government Income Fund, and the PIA Equity Fund.

During the 12 months ended November 30, 1999, the returns including the
reinvestment of dividends and capital gains, were as follows:

OCM Gold Fund ..........................(4.6)%
Camborne Government Income Fund ........(1.2)%
PIA Equity Fund ........................12.07%

Continued weakness in the prices of gold stocks on which the OCM Gold Fund
focuses severely impacted the returns on that portfolio. Your portfolio manager
believes that the prospect of improved global economic growth will in 2000
result in improved returns in this sector of the stock market.

The returns of the Camborne Government Bond Fund were comparable to its
benchmark, the Lehman US Government Bond Index, which declined in value by 1.4%
during the same period. With long term Treasury Bonds now yielding significantly
more than 6% and with the perceived low core rate on inflation, the prospect for
continued increases in interest rates does not appear to be high since real
rates of interest are at historically high levels.

The PIA Equity Fund's positive results were due in part to a recovery in small
capitalization stocks particularly in the technology area. We noted with
interest that for 1999 this Fund rated high amongst its peers in its Morningstar
category.

Please take a moment to review your Fund(s)' statement of assets and results of
operations for the year ended November 30, 1999. After what has proven to be an
exciting year in the markets, we eagerly anticipate the opportunities of the new
millenNium and look forward to reporting to you in six months.

/s/ LLOYD MCADAMS
- -----------------
Lloyd McAdams
Chairman of the Board

-2-

MONTEREY FUNDS
SCHEDULES OF INVESTMENTS - NOVEMBER 30, 1999

OCM GOLD FUND
- --------------------------------------------------------------------------------
SHARES VALUE
- --------------------------------------------------------------------------------

COMMON STOCKS 86.46%
MAJOR GOLD PRODUCERS 53.26%
<C> <S> <C>
28,000 Anglogold Ltd. ADR .............................. $ 718,375
32,000 Barrick Gold Corp. .............................. 576,000
10,000 Freeport-McMoRan Copper &
Gold Inc. Class B ............................. 158,125
5,000 Freeport-McMoRan Copper
& Gold Inc. ................................... 67,812
85,000 Gold Fields Ltd. ADR ............................ 379,844
30,000 Harmony Gold Mining - ADR ....................... 196,875
125,000 Homestake Mining Co. ............................ 1,031,250
75,000 Newmont Mining Corp. ............................ 1,776,563
121,250 Placer Dome Inc. ................................ 1,379,219
------------
6,284,063
------------

INTERMEDIATE/MID-TIER
GOLD PRODUCERS 18.69%
35,000 Agnico-Eagle Mines .............................. 264,687
130,000 Battle Mountain Gold Co. ........................ 325,000
10,000 Compania de Minas Buenaventura - ADR ............ 164,375
130,000 GoldCorp Inc. ................................... 706,875
55,000 Kinross Gold Corp.* ............................. 110,000
85,000 Meridian Gold Inc.* ............................ 525,937
125,000 TVX Gold Inc.* .................................. 109,375
------------
2,206,249
------------

JUNIOR GOLD PRODUCERS 5.52%
55,000 Aurizon Mines, Ltd. ............................. 26,715
55,000 Glamis Gold Ltd.* ............................... 99,687
59,300 Golden Cycle Gold Corp.* ........................ 400,275
30,000 Miramar Mining Corp.* ........................... 15,274
55,000 Richmont Mines Inc.* ............................ 78,406
10,000 River Gold Mines Ltd. * ......................... 14,935
25,000 Viceroy Resources Corp. ......................... 15,613
------------
650,905
------------

EXPLORATION AND DEVELOPMENT
COMPANIES 1.25%
15,000 Aber Resournces Ltd.* ........................... 78,750
200,000 Addwest Minerals International Ltd.* ............ 10,862
10,000 Crown Resources Corp. ........................... 20,469
100,000 Franc-Or Resources Corp. ........................ 16,971
10,000 Golden Queen Mining Ltd.* ....................... 3,462
185,500 New Guinea Gold Corp. ........................... 5,667
25,000 Omni Resources Inc. ............................. 1,018
100,000 Silver Eagle Resources Inc.* .................... 10,522
------------
147,721
------------

PRIMARY SILVER PRODUCERS 1.13%
10,000 Coeur D'Alene Mines Corp. ....................... 40,625
45,000 Hecla Mining Co. ................................ 92,813
------------
133,438
------------

PLATINUM/PALLADIUM
PRODUCERS 2.57%
12,500 Stillwater Mining Co.* .......................... 303,125
------------

GOLD MINING ROYALTY
COMPANIES 4.04%
26,000 Franco Nevada Mining Corp. ...................... 476,547
------------

TOTAL COMMON STOCKS
(cost $10,829,937) .............................. 10,202,048
------------

PREFERRED STOCKS 0.30%
7,500 Coeur D'Alene Mines Corp.
(cost $111,075) .............................. 35,156
------------

*Non income producing security

See notes to financial statements

-3-

<PAGE>

MONTEREY FUNDS
SCHEDULES OF INVESTMENTS - NOVEMBER 30, 1999

OCM GOLD FUND (CONTINUED)
- --------------------------------------------------------------------------------
SHARES/PRINCIPAL VALUE VALUE
- --------------------------------------------------------------------------------

SHORT TERM INVESTMENTS 13.18%
MUTUAL FUNDS 5.02%
591,988 Firstar Treasury Fund
(cost $591,988) .............................. $ 591,988
------------

REPURCHASE AGREEMENTS 8.16%
$963,000 Firstar Bank Repurchase Agreement 3.35%
due December 1, 1999 collateralized
by the following:
Conventional Loan Pool, 7.831%
due 03/01/25 ($6,050)
FHA/VA Pool, 7.00%
due 11/15/07 ($111,313)
FHA/VA Pool, 7.00%
due 07/15/08 ($181,054)
FHA/VA Pool, 7.50%
due 09/15/08 ($106,250)
FHA/VA Pool, 7.00%
due 09/15/08 ($184,762)
FHA/VA Pool, 7.00%
due 11/15/10 ($215,404)
FHA/VA Pool, 7.00%
due 10/15/11 ($177,320)
(cost $963,000) .............................. 963,000
------------
TOTAL SHORT TERM INVESTMENTS ................................ 1,554,988
------------

TOTAL INVESTMENTS
(cost $12,496,000) .................. 99.94% 11,792,192
OTHER ASSETS LESS LIABILITIES ....................... 0.06% 6,903
------- ------------
TOTAL NET ASSETS .................................... 100.00% $ 11,799,095
======= ============

CAMBORNE GOVERNMENT INCOME FUND
- --------------------------------------------------------------------------------
PRINCIPAL
VALUE VALUE
- --------------------------------------------------------------------------------

LONG TERM INVESTMENTS 95.86%
CORPORATE 26.17%
$ 30,000 Rochester Gas & Electric Corp., 9.375%, 04/01/21 $ 31,980
40,000 Rohm & Haas Holdings Co., 9.80%, 04/15/20 ....... 46,160
50,000 Westvaco Corp., 10.125%, 06/01/19 ............... 52,527
85,000 W.R. Berkley Corp., 9.875%, 05/15/08 ............ 96,116
------------
226,783
------------

MORTGAGE-BACKED SECURITIES 21.40%
145,000 FHLMC RMC CL 1617-PM, 6.50%, 11/15/23. .......... 135,706
12,812 FNMA CMO 199-192 CL-SA, 11.00%, 04/25/07 ........ 12,778
7,990 GNMA, 9.50%, 09/15/19 ........................... 8,541
4,974 Prudential 1993-59 A5, 7.125%, 12/25/00 ......... 4,972
21,590 Traveler's Mortgage Securities Corp. 12.00%,
03/01/14 ..................................... 23,522
------------
185,519
------------

U.S. GOVERNMENT SECURITIES 48.29%
150,000 U.S. Treasury Bonds, 5.875%, 10/31/01 ........... 149,673
100,000 U.S. Treasury Bonds, 5.75%, 11/30/02 ............ 99,219
90,000 U.S. Treasury Bonds, 6.50%, 10/15/06 ............ 91,097
25,000 U.S. Treasury Bonds, 6.375%, 08/15/27 ........... 24,570
20,000 U.S. Treasury Bonds, 6.125%, 11/15/27 ........... 19,063
40,000 U.S. Treasury Bonds, 5.50%, 08/15/28 ............ 35,000
------------
418,622
------------

*Non income producing security

See notes to financial statements

-4-

<PAGE>

MONTEREY FUNDS
SCHEDULES OF INVESTMENTS - NOVEMBER 30, 1999

CAMBORNE GOVERNMENT INCOME FUND (CONTINUED)
- --------------------------------------------------------------------------------
PRINCIPAL
VALUE VALUE
- --------------------------------------------------------------------------------

TOTAL LONG TERM INVESTMENTS
(cost $836,087) .............................. $ 830,924
------------

SHORT TERM INVESTMENTS 4.44%
38,499 Firstar Treasury Fund
(cost $38,499) ............................... 38,499
------------

TOTAL INVESTMENTS
(cost $874,586) ..................... 100.30% 869,423
LIABILITIES LESS OTHER ASSETS ...................... (0.30)% (2,582)
------- ------------
TOTAL NET ASSETS ................................... 100.00% $ 866,841
======= ============

PIA EQUITY
- --------------------------------------------------------------------------------
SHARES VALUE
- --------------------------------------------------------------------------------

COMMON STOCKS 91.81%
AUTO PARTS 4.03%
2,060 Borg-Warner Automotive Inc. ..................... $ 83,430
------------
BUILDING & CONSTRUCTION 5.86%
3,650 Kennametal Inc. ................................. 121,362
------------
CAPITAL GOODs 3.41%
4,850 Callaway Golf ................................... 70,628
------------
COMMERCIAL SERVICES 3.62%
2,900 Central Parking ................................. 75,037
------------
COMMUNICATION 4.52%
2,950 Digital Lightwave Inc.* ......................... 93,570
------------
COMPUTERS/SOFTWARE 3.74%
1,450 Concord Communication Inc.* ..................... 77,394
------------
COSMETICS & TOILETRIES 2.41%
1,900 Alberto-Culver Company .......................... 49,994
------------
ELECTRONICS 6.42%
4,270 Actel Corporation* .............................. 99,945
600 Avnet Inc. ...................................... 32,962
------------
132,907
------------

FIBER OPTICS 2.97%
1,400 Ciena Corporation* .............................. 61,469
------------
INTERNET SOFTWARE 8.28%
3,080 Concentric Network Corporation .................. 87,684
1,600 Pcorder.com, Inc.* .............................. 83,800
------------
171,484
------------

*Non income producing security

See notes to financial statements

-5-

<PAGE>

MONTEREY FUNDS
SCHEDULES OF INVESTMENTS - NOVEMBER 30, 1999

PIA EQUITY (CONTINUED)
- --------------------------------------------------------------------------------
SHARES VALUE
- --------------------------------------------------------------------------------

MEDICAL 13.97%
2,375 Beckman Coulter, Inc. ........................... $ 113,406
1,625 Dendrite International, Inc.* ................... 44,789
3,000 Shared Medical Systems Corp. .................... 131,250
------------
289,445
------------

NETWORKING PRODUCTS 2.56%
3,250 Information Resource Engineering, Inc.* ......... 53,117
------------
PHARMACEUTICAL 1.52%
1,150 Elan Corporation PLC ADR ........................ 31,481
------------
RESTAURANTS 2.40%
7,710 CKE Restaurants, Inc. ........................... 49,633
------------
RETAIL 3.36%
2,625 Ames Department Stores Inc.* .................... 69,645
------------
SEMICONDUCTOR 13.12%
3,200 Cohu, Inc. ...................................... 73,400
2,020 Dallas Semiconductor Corp. ...................... 116,529
1,730 Transwitch Corp.* ............................... 81,959
------------
271,888
------------
TELECOMMUNICATION SERVICES 5.93%
4,220 Broadwing Inc. .................................. 122,908
------------
TRANSPORTATION & EQUIPMENT 3.69%
2,300 CNF Transportation Inc. ......................... 76,475
------------
TOTAL COMMON STOCKS
(cost $1,829,914) 1,901,867
------------

SHORT TERM INVESTMENTS 10.10%
MUTUAL FUNDS 4.89%
101,291 Firstar Treasury Fund
(cost $101,291) .............................. 101,291

REPURCHASE AGREEMENTS 5.21%
$108,000 Firstar Bank Repurchase Agreement 3.35%
due December 1, 1999 collateralized by
Conventional Loan Pool, 7.831%
due 03/01/25 ($679)
FHA/VA Pool, 7.00% due 11/15/07 ($12,484)
FHA/VA Pool, 7.00% due 07/15/08 ($20,305)
FHA/VA Pool, 7.50% due 09/15/08 ($11,916)
FHA/VA Pool, 7.00% due 09/15/08 ($20,721)
FHA/VA Pool, 7.00% due 11/15/10 ($24,157)
FHA/VA Pool, 7.00% due 10/15/11 ($19,886)
(cost $108,000) ......................... 108,000
------------
TOTAL SHORT TERM INVESTMENTS 209,291
------------

TOTAL INVESTMENTS
(cost $2,039,205) ................... 101.91% 2,111,158
LIABILITIES LESS OTHER ASSETS ...................... (1.91%) (39,518)
------- ------------
TOTAL NET ASSETS ................................... 100.00% $ 2,071,640
======= ============

<FN>

*Non income producing security
</FN>
</TABLE>

See notes to financial statements

-6-

<PAGE>

MONTEREY FUNDS
STATEMENTS OF ASSETS AND LIABILITIES - NOVEMBER 30, 1999
<TABLE>
<CAPTION>

CAMBORNE
OCM GOVERNMENT PIA
GOLD INCOME EQUITY
--------------------------------------------
ASSETS
<S> <C> <C> <C>
Investments in securities, at value
(cost $12,496,000, $874,586 and $2,039,205, respectively) $ 11,792,192 $ 869,423 $ 2,111,158
Receivable for securities sold ............................ 44,525 0 271,559
Receivable for fund shares sold ........................... 28,638 0 0
Income receivable ......................................... 10,488 8,382 1,761
Due from investment adviser (Note 3) ...................... 0 9,110 4,787
Prepaid expenses and other ................................ 10,686 14,332 6,203
------------ ------------ ------------
Total assets ...................................... 11,886,529 901,247 2,395,468
------------ ------------ ------------

LIABILITIES
Payable for securities purchased .......................... 26,715 0 19,293
Payable for fund shares redeemed .......................... 18,679 25,274 295,300
Dividends payable ......................................... 0 256 0
Due to investment adviser (Note 3) ....................... 2,190 0 0
Accrued expenses and other ................................ 39,850 8,876 9,235
------------ ------------ ------------
Total liabilities ................................. 87,434 34,406 323,828
------------ ------------ ------------

NET ASSETS
Shares of beneficial interest, no par value;
unlimited shares authorized ............................... 15,347,209 912,087 2,044,048
Undistributed net investment income ....................... 0 496 3,204
Accumulated net realized loss on investments and
foreign currencies ................................ (2,844,306) (40,579) (47,565)
Net unrealized appreciation (depreciation) on investments
and foreign currencies ............................ (703,808) (5,163) 71,953
------------ ------------ ------------
Net assets ........................................ $ 11,799,095 $ 866,841 $ 2,071,640
============ ============ ============

CALCULATION OF MAXIMUM OFFERING PRICE
Net asset value and redemption price per share ............ $ 4.75 $ 13.31 $ 17.68
Maximum sales charge (4.50% of offering price) ............ 0.22 0.63 0.83
------------ ------------ ------------
Offering price to public .................................. $ 4.97 $ 13.94 $ 18.51
------------ ------------ ------------
Shares outstanding ................................ 2,485,709 65,123 117,192
============ ============ ============

</TABLE>

See notes to financial statements

-7-

<PAGE>

MONTEREY FUNDS
STATEMENTS OF OPERATIONS - FOR THE YEAR ENDED NOVEMBER 30, 1999
<TABLE>
<CAPTION>

CAMBORNE
OCM GOVERNMENT PIA
GOLD INCOME EQUITY
<S> <C> <C> <C>
INVESTMENT INCOME
Interest ...................................................... $ 50,262 $ 61,334 $ 5,303
Dividends ..................................................... 85,693 0 31,037
--------- --------- ---------
Total investment income ............................... 135,955 61,334 36,340
--------- --------- ---------

EXPENSES
Adviser fees (Note 3) ......................................... 96,569 3,523 17,319
Distribution fees (Note 4) .................................... 95,603 881 4,330
Administrative fees (Note 3) .................................. 21,854 16,492 16,738
Transfer agent fees ........................................... 21,387 15,935 16,378
Custodian fees ................................................ 7,916 2,586 3,286
Audit fees .................................................... 7,155 7,155 7,155
Legal fees .................................................... 3,327 3,280 5,240
Registration fees ............................................. 24,357 4,980 17,857
Trustees' fees ................................................ 1,278 1,263 1,279
Printing expense .............................................. 6,984 0 1,523
Postage expense ............................................... 3,313 0 643
Other expenses ................................................ 2,418 994 990
--------- --------- ---------
Total expenses ........................................ 292,161 57,089 92,738
Less: Expense reimbursement from adviser and sub-adviser (Note 3) (56,323) (47,401) (61,564)
--------- --------- ---------
Net expenses .......................................... 235,838 9,688 31,174
--------- --------- ---------
Net investment income (loss) .......................... (99,883) 51,646 5,166
--------- --------- ---------

REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS
Net realized loss on investments .............................. (667,419) (769) (32,920)
Net unrealized appreciation (deprecation) on investments ...... 339,128 (61,369) 249,715
--------- --------- ---------
Net gain (loss) on investments ................................ (328,291) (62,138) 216,795
--------- --------- ---------
Net increase (decrease) in net assets
resulting from operations ............................. $(428,174) $ (10,492) $ 221,961
========= ========= =========
</TABLE>

See notes to financial statements

-8-

<PAGE>

MONTEREY FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>

CAMBORNE
OCM GOVERNMENT PIA
GOLD INCOME EQUITY
--------------------------------------------------------------------------------------
Year ended Year ended Year ended Year ended Year ended Year ended
Nov. 30, Nov. 30, Nov. 30, Nov. 30, Nov. 30, Nov. 30,
1999 1998 1999 1998 1999 1998
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Operations
Net investment income (loss) .......... $ (99,883) $ (55,206) $ 51,646 $ 67,756 $ 5,166 $ 7,689
Net realized gain (loss) on investments (667,419) (364,267) (769) 30,507 (32,920) 176,175
Net unrealized appreciation
(depreciation) on investments . 339,128 209,137 (61,369) (6,404) 249,715 (317,246)
Net increase (decrease) in net assets
resulting from operations ..... (428,174) (210,336) (10,492) 91,859 221,961

Net equalization (debits) credits ..... 0 0 (142) (42) 0 0

Dividends Paid to Shareholders
Dividends from net investment income .. 0 0 (51,616) (69,700) (9,651) 0
Distributions from net realized gains . 0 0 0 0 (200,251) (320,265)
0 0 (51,616) (69,700) (209,902) (320,265)

Fund Share Transactions
Net proceeds from shares sold ......... 4,601,404 7,033,912 98,544 179,492 1,632,677 2,151,015
Dividends reinvested .................. 0 0 47,613 58,452 209,901 238,717
Payment for shares redeemed ........... (625,395) (199,636) (238,969) (199,256) (2,039,792) (2,456,239)
Net increase (decrease) in net assets
from fund share transactions .. 3,976,009 6,834,276 (92,812) 38,688 (197,214) (66,507)
Net increase (decrease) in net assets . 3,547,835 6,623,940 (155,062) 60,805 (185,155) (520,154)
NET ASSETS, Beginning of Year ......... 8,251,260 1,627,320 1,021,903 961,098 2,256,795 2,776,949
NET ASSETS, End of Year ............... $11,799,095 $8,251,260 $ 866,841 $1,021,903 $ 2,071,640 $ 2,256,795

Changes in Shares Outstanding
Shares sold ........................... 963,359 1,375,985 7,329 12,886 107,096 111,105
Shares issued on reinvestment
of dividends .................. 0 0 3,471 4,132 13,490 12,704
Shares redeemed ....................... (134,176) (39,416) (17,255) (14,105) (132,037) (128,755)
Net increase (decrease) in
shares outstanding ............ 829,183 1,336,569 (6,455) 2,913 (11,451) (4,946)

</TABLE>

See notes to financial statements

-9-

<PAGE>

MONTEREY FUNDS
NOTES TO FINANCIAL STATEMENTS - NOVEMBER 30, 1999

NOTE 1. ORGANIZATION
Monterey Mutual Fund (the "Trust"), formerly Monitrend Mutual Fund, is
registered under the Investment Company Act of 1940, as amended, as a
diversified, open-end management investment company. The Trust was organized as
a Massachusetts business trust on January 6, 1984 and consists of nine series of
shares: the PIA Short Term Government Securities Fund, the Camborne Government
Income Fund, the OCM Gold Fund, the PIA Equity Fund, the Murphy New World
Biotechnology Fund, the Murphy New World Technology Fund, the Murphy New World
Technology Convertibles Fund, the PIA Global Bond Fund and the PIA Total Return
Bond Fund (collectively the "Funds"), each of which has separate assets and
liabilities and differing investment objectives. The investment objective for
each of the Funds presented herein are: the OCM Gold Fund, (the "Gold Fund"),
long-term growth of capital through investing primarily in equity securities of
domestic and foreign companies engaged in activities related to gold and
precious metals; the Camborne Government Income Fund, (the "Government Fund")
growth of capital, whether over the short or long-term, income and preservation
of capital; the PIA Equity Fund, (the "Equity Fund"), long-term growth of
capital.

NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed
by the Funds in the preparation of their financial statements.

SECURITY VALUATION--Portfolio securities that are listed on the
national securities exchanges are valued at the last sale price as of the close
of such securities exchanges, Eastern time, or, in the absence of recorded
sales, at the average of readily available closing bid and asked prices on such
exchanges. Unlisted securities are valued at the average of the quoted bid and
asked prices in the over-the-counter market. Securities and other assets for
which market quotations are not readily available are valued at fair market
value as determined in good faith by the Adviser under procedures established by
and under the general supervision and responsibility of the Trust's Board of
Trustees. Short-term investments which mature in less than 60 days are valued at
amortized cost (unless the Board of Trustees determines that this method does
not represent fair market value). Short-term investments which mature after 60
days are valued at market. Stock Index Futures, which are traded on commodities
exchanges, are valued at their last sales price as of the close of such
commodities exchanges.

OPTIONS--When a call is written, an amount equal to the premium
received is included in the Statement of Assets and Liabilities as an equivalent
liability. The amount of the liability is subsequently marked to market to
reflect the current market value of the option written. If an option which was
written either expires on its stipulated expiration date, or a closing purchase
transaction is entered into, a gain is realized (or loss if the cost of a
closing purchase transaction exceeds the premium received when the option was
sold) without regard to any unrealized gain or loss on the underlying security,
and the liability related to such option is extinguished.

If a written call option is exercised, a capital gain or loss is
realized from the sale of the underlying security and the proceeds from such
sale are increased by the premium originally received.

The premium paid for the purchase of a call or a put option is included
in the asset section of the Statement of Assets and Liabilities as an investment
and is subsequently adjusted to the current market value of the option. If a
purchased option expires on its stipulated expiration date, a loss is realized
in the amount of the cost of the option. If a closing sale transaction is
entered into, a gain or loss will be realized depending on whether the sales
proceeds from the closing sale transaction are greater or less than the cost of
the option. If a put option is exercised, a gain or loss will be realized from
the sale of the underlying security and the proceeds from such sale will be
decreased by the premium originally paid. If a call option is exercised, the
cost of the security purchased upon exercise will be increased by the premium
originally paid.

FUTURES CONTRACTS--The Government Fund and Equity Fund may from time to
time enter into futures contracts as a hedge to provide protection against
adverse movements in the prices of securities in the portfolio. When a Fund
enters a futures contract, it is required to pledge to the clearing broker an
amount of cash and/or securities equal to approximately 5% of the contract
amount. This amount is known as the "initial margin". Pursuant to the futures
contract, the Fund agrees to take or make delivery of an amount of cash equal to
a specified dollar amount times the difference between the value at the close of
the day and the price at which the futures contract was originally struck. Such
payments, known as the "variation margin", are recorded by the Fund as
unrealized gains or losses. When the futures contract expires or is closed by
the Fund it realizes a gain or loss.

FINANCIAL INSTRUMENTS WITH OFF BALANCE SHEET RISK--Futures contracts
involve elements of market risk and credit risk in excess of the amounts
reflected in the Statement of Assets and Liabilities. The contract amounts of
these futures contracts reflect the extent of exposure to off balance sheet
risk.

The predominant market risk is that movements in the prices of the
Fund's portfolio securities being hedged may not correlate perfectly with the
movement in the prices of the future contracts. The lack of correlation could
render the Fund's hedging strategy unsuccessful and could result in a loss to
the Fund.

Futures contracts are purchased only on exchanges. The exchange acts as
the counterparty to the Fund's futures transactions; therefore the Fund's credit
risk is limited to failure of the exchange.

-10-

<PAGE>

MONTEREY FUNDS
NOTES TO FINANCIAL STATEMENTS - NOVEMBER 30, 1999

FEDERAL INCOME TAXES--It is each Fund's policy to meet the requirements
of the Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable net income to its shareholders. Therefore the
Funds paid no Federal Income taxes and no Federal income tax provision was
required. At November 30, 1999, the Gold Fund and Government Fund have capital
loss carryovers of approximately $2,766,000 and $41,000, respectively, which
expire in varying amounts through 2003 and 2005, respectively.

OTHER--Securities transactions are recorded no later than the first
business day after the trade date. Discounts and premiums on securities
purchased are amortized over the life of the respective security. Realized gains
and losses on sales of securities are calculated on the identified cost basis.
Dividend income is recorded on the ex-dividend date. Interest income is recorded
on an accrual basis.

USE OF ESTIMATES--The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of increases and decreases in
net assets from operations during the reporting period. Actual results could
differ from those estimates.

NOTE 3. INVESTMENT ADVISORY AND ADMINISTRATION AGREEMENTS
The Gold Fund has an advisory agreement with Orrell Capital Management,
a division of Orrell and Company, Inc. ("Orrell"). Under the agreement, the Gold
Fund pays Orrell a fee computed daily and payable monthly, at the following
annual rates based upon daily net assets:

ASSETS FEE RATE
------ --------
0 to $50 million ...................... 1.000%
$50 million to $75 million ............ 0.875%
$75 million to $100 million ........... 0.750%
$100 million to $150 million .......... 0.625%
$150 million to $250 million .......... 0.500%
Over $250 million ..................... 0.375%

The Government Fund has an investment advisory agreement with Pacific
Income Advisers, Inc. ("PIA"), and PIA had a sub-advisory agreement with
Camborne Advisors Inc. On November 9, 1999, Camborne Advisers notified the PIA
of their intention to resign as sub-adviser effective January 7, 2000. Under the
agreement, the Government Fund pays PIA a fee computed daily and payable
monthly, at an annual rate of 0.40% of the Government Fund's daily net assets;
and PIA paid Camborne Advisors, Inc. a sub-advisory fee computed daily and paid
monthly at an annual rate of 0.20% of the Government Fund's daily net assets.

The Equity Fund has an investment advisory agreement with PIA. The
Equity Fund pays PIA a fee computed daily and payable monthly, at the following
annual rate based upon daily net assets:

ASSETS FEE RATE
------ --------
0 to $50 million ..................... 1.000%
$50 million to $75 million ........... 0.875%
$75 million to $100 million .......... 0.750%
$100 million to $150 million ......... 0.625%
$150 million to $250 million ......... 0.500%
Over $250 million .................... 0.375%

During the year ended November 30, 1999 the advisers agreed to
reimburse the Funds for expenses in excess of 2.44% of average net assets for
the Gold Fund, 1.80% for the Equity Fund and 1.10% of average net assets for the
Government Fund. The amounts reimbursed by the advisers in 1999 are set forth in
the Statement of Operations.

The Trust has a fund accounting and administrative agreement with
American Data Services, Inc. ("ADS"). ADS receives a fee, computed daily and
payable monthly, at an annual rate of 0.10% of average daily net assets, subject
to a monthly minimum.

-11-

<PAGE>

MONTEREY FUNDS
NOTES TO FINANCIAL STATEMENTS - NOVEMBER 30, 1999

NOTE 4. DISTRIBUTION AGREEMENT AND PLAN
Syndicated Capital, Inc. serves as the Distributor of each Funds'
shares. The President and sole shareholder of the Distributor is also the
Chairman and majority shareholder of PIA, as well as a trustee of the Trust.

The Trust has adopted a Distribution Plan (the "Plan") pursuant to Rule
12b-1 under the Investment Company Act of 1940. The Plan authorizes each Fund to
reimburse the Distributor for marketing expenses incurred in distributing shares
of each Fund, including the cost of printing sales material and making payments
to dealers in each Fund shares, in any fiscal year, subject to a limit of 0.99%
for the Gold Fund, 0.10% for the Government Fund and 0.25% for the Equity Fund.
Distribution fees incurred by each Fund are set forth in the Statement of
Operations.

NOTE 5. PURCHASES AND SALES OF SECURITIES
The cost of purchases and sales of investment securities (other than
short-term investments) for the year ended November 30, 1999, were as follows:

PURCHASES SALES
--------- -----
Gold Fund $ 4,195,068 $ 753,941
Government Fund 801,194 910,584
Equity Fund 4,336,999 4,824,562

The cost for Federal income tax purposes for the Gold Fund is
$12,847,039, the Government Fund is $874,586 and the Equity Fund is $2,085,487.
Unrealized appreciation and depreciation on investments at November 30, 1999
based on cost for Federal income taxes are as follows:

UNREALIZED UNREALIZED
APPRECIATION DEPRECIATION NET
------------ ------------ ---
Gold Fund $ 895,359 ($ 1,599,167) ($ 703,808)
Government Fund 8,818 (13,981) (5,163)
Equity Fund 201,564 (129,611) 71,953

-12-

<PAGE>

MONTEREY FUNDS
OCM GOLD
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)

For the Year Ended November 30,
1999 1998 1997++ 1996* 1995*
---------------------------------------------------------------------

<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period .... $ 4.98 $ 5.09 $ 8.29 $ 5.91 $ 5.87
--------- --------- --------- --------- --------

Income From Investment Operations
Net investment loss ..................... (0.04) (0.03) (0.09) (0.15) (0.09)
Net realized and unrealized gain/(loss)
on investments .................. (0.19) (0.08) (3.11) 2.53 0.13
--------- --------- --------- --------- --------
Total from investment operations ........ (0.23) (0.11) (3.20) 2.38 0.04
--------- --------- --------- --------- --------

Less Distributions
Dividends from net investment income .... 0.00 0.00 0.00 0.00 0.00
--------- --------- --------- --------- --------
Total distributions ..................... 0.00 0.00 0.00 0.00 0.00
--------- --------- --------- --------- --------
Net asset value, end of period .......... $ 4.75 $ 4.98 $ 5.09 $ 8.29 $ 5.91
========= ========= ========= ========= ========
Total return** .......................... (4.62%) (2.16%) (38.60%) 40.27% 0.68%

Ratios/Supplemental Data
Net assets, end of period (in 000's) .... 11,799 8,251 1,627 1,531 421
Ratio of expenses to average net assets . 2.44% 2.44% 2.44% 2.37% 2.44%
Ratio of expenses to average net
assets, before reimbursement .... 3.02% 3.32% 5.78% 6.15% 12.52%
Ratio of net investment (loss) to average
net assets ...................... (1.03%) (0.96%) (1.60%) (1.72%) (1.57%)
Portfolio turnover rate ................. 9.03% 1.73% 17.68% 35.70% 15.57%

<FN>

* Based on average shares outstanding.
** Excluding sales charge. Not annualized for periods less than a year.
++ On 12/13/96 Orrell and Company, Inc. became the Fund's investment adviser.
Prior to 12/31/96 Monitrend Investment Management, Inc. was the Fund's
investment adviser.
</FN>
</TABLE>

See notes to financial statements

-13-

<PAGE>

MONTEREY FUNDS
CAMBORNE GOVERNMENT
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)

For the Year Ended November 30,
1999 1998 1997 1996 1995
---------------------------------------------------------

<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period .... $ 14.28 $ 14.00 $ 13.59 $ 13.88 $ 12.76
-------- --------- -------- --------- -------

Income From Investment Operations
Net investment income ................... 0.81 0.87 0.89 0.73 0.81
Net realized and unrealized gain/(loss)
on investments .................. (0.97) 0.31 0.38 (0.28) 1.12
-------- --------- -------- --------- -------
Total from investment operations ........ (0.16) 1.18 1.27 0.45 1.93
-------- --------- -------- --------- -------

Less Distributions
Dividends from net investment income .... (0.81) (0.90) (0.86) (0.74) (0.81)
-------- --------- -------- --------- -------
Total distributions ..................... (0.81) (0.90) (0.86) (0.74) (0.81)
-------- --------- -------- --------- -------
Net asset value, end of period .......... $ 13.31 $ 14.28 $ 14.00 $ 13.59 $ 13.88
======== ========= ======== ========= =======
Total return* ........................... (1.15%) 8.68 9.70% 3.42% 15.56%

Ratios/Supplemental Data
Net assets, end of period (in 000's) .... 867 1,022 961 1,293 947
Ratio of expenses to average net assets . 1.10% 1.10% 1.10% 1.07% 1.10%
Ratio of expenses to average net
assets, before reimbursement .... 6.50% 4.73% 6.98% 5.68% 5.73%
Ratio of net investment income to average
net assets ...................... 5.88% 6.15% 6.53% 5.35% 6.04%
Portfolio turnover rate ................. 103.24% 122.44% 111.26% 129.17% 91.03%

<FN>

* Excluding sales charge.
</FN>
</TABLE>

See notes to financial statements

-14-

<PAGE>

MONTEREY FUNDS
PIA EQUITY
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)

For the Year Ended November 30,
1999 1998 1997++ 1996* 1995*
------------------------------------------------------------

<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........... $ 17.54 $ 20.79 $ 19.63 $ 15.36 $ 11.12
--------- -------- -------- ------- -------

Income From Investment Operations
Net investment income/(loss) ................... 0.05 0.06 (1.21) (0.37) (0.24)
Net realized and unrealized gain/(loss)
on investments ......................... 1.83 (0.91) 3.05 4.64 4.48
--------- -------- -------- ------- -------
Total from investment operations ............... 1.88 (0.85) 1.84 4.27 4.24
--------- -------- -------- ------- -------

Less Distributions
Dividends from net investment income ........... (0.08) 0.00 0.00 0.00 0.00
Distributions from net realized gains .......... (1.66) (2.40) (0.68) 0.00 0.00
--------- -------- -------- ------- -------
Total distributions ............................ (1.74) (2.40) (0.68) 0.00 0.00
--------- -------- -------- ------- -------
Net asset value end of period .................. $ 17.68 $ 17.54 $ 20.79 $ 19.63 $ 15.36
========= ======== ======== ======= =======
Total return** ................................. 12.07% (4.86%) 9.96 27.80% 38.13%

Ratios/Supplemental Data
Net assets, end of period (in 000's) ........... 2,072 2,257 2,777 715 526
Ratio of expenses to average net assets ........ 1.80% 2.14% 2.43% 2.25% 2.44%
Ratio of expenses to average net
assets, before reimbursement ........... 5.36% 3.21% 6.71% 11.73% 11.44%
Ratio of net investment income (loss) to average
net assets ............................. 0.30% 0.23% (0.06%) (2.07%) (2.21%)
Portfolio turnover rate ........................ 276.17% 135.49% 139.57% 41.22% 23.75%

<FN>

* Based on average shares outstanding.
** Excluding sales charge.
++ On 12/13/96 Pacific Income Advisers, Inc. became the Fund's investment
adviser. Prior to 12/13/96, Monitrend Investment Management, Inc. was the
Fund's investment adviser.
</FN>
</TABLE>

See notes to financial statements

-15-

<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Trustees and Shareholders of
Monterey Mutual Fund

In our opinion, the accompanying statements of assets and liabilities, including
the schedules of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of The OCM Gold Fund, the PIA Equity
Fund and the Camborne Government Income Fund, series of Monterey Mutual Fund,
(hereafter referred to as the "Trust") at November 30, 1999, and the results of
each of their operations, the changes in each of their net assets and the
financial highlights for the year then ended, in conformity with generally
accepted accounting principles. These financial statements and financial
highlights (hereafter referred to as "financial statements") are the
responsibility of the Trust's management; our responsibility is to express an
opinion on these financial statements based on our audit. We conducted our audit
of these financial statements in accordance with generally accepted auditing
standards, which 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, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audit, which included confirmation of securities at November 30, 1999 by
correspondence with the custodian and brokers, provides a reasonable basis for
the opinion expressed above. The financial statements for the year ended
November 30, 1998 including the financial highlights for each of the four years
in the period then ended, were audited by other independent accountants whose
report dated January 8, 1999 expressed an unqualified opinion on those financial
statements.

PricewaterhouseCoopers LLP
New York, New York
December 17, 1999

-16-

<PAGE>

CHANGE IN INDEPENDENT ACCOUNTANT

On August 13, 1999, McGladrey & Pullen, LLP ("McGladrey") resigned as
independent auditors of the Trust pursuant to an agreement by
PricewaterhouseCoopers LLP ("PwC") to acquire McGladrey's investment company
practice. The McGladrey partners and professionals serving the Trust at the time
of the acquisition joined PwC.

The reports of McGladrey on the financial statements of the Trust during
the past two fiscal years contained no adverse opinion or disclaimer of opinion,
and were not qualified or modified as to uncertainty, audit scope or accounting
principles.

In connection with its audits for the two most recent fiscal years and
through August 13, 1999 there were no disagreements with McGladrey on any matter
of accounting principle or practices, financial statement disclosure, or
auditing scope or procedure, which disagreements, if not resolved to the
satisfaction of McGladrey would have caused it to make reference to the subject
matter of disagreement in connection with its report.

On September 9, 1999, the Trust, with the approval of its Board of
Trustees and its Audit Committee, engaged PwC as its independent auditors.

-17-

<PAGE>
MONTEREY FUNDS
PERFORMANCE RESULTS - YEAR ENDED NOVEMBER 30, 1999
(ALL PERFORMANCE MEASUREMENTS REFLECT THE MAXIMUM SALES LOAD CHARGED,
FOR EACH PERIOD SHOWN.)

OCM GOLD FUND

AVERAGE ANNUAL TOTAL RETURNS VALUE ON 11/30/99
- ---------------------------- -----------------

1 year (8.91%) OCM Gold $5,485
Inception (18.34%) Phil. Gold & Silver $5,950
S&P 500 $19,599

$10,000 Investment made 12/13/96 (date Orrell became investment adviser)

Past performance is not The S&P 500 Index is a broad unmanaged
predictive of future performance index generally considered to be
representative of the US equity market.
The Philadelphia Gold & Silver Index is
an unmanaged index of 11 gold and
silver equity securities.

The focus of the gold market remained on central bank activity in 1999, with two
major events influencing prices. In May, the Bank of England surprised the gold
market with a highly controversial decision to sell approximately half of its
gold reserves. However, on September 26th European central banks sent a message
to the gold market that it had seen enough and announced that gold sales would
be restricted to those already announced and gold lending activity would not be
expanded for at least the next five years. Furthermore, the Europeans made it
clear that gold would remain an important element of monetary reserves. The
reaction in the gold market was swift to the upside as the gold price reached
$324 an ounce on October 6th, a 28% advance from the 21 year low of $253 an
ounce in July. Fearing a run away gold price posed significant risks to the
financial system with Y2K approaching, the Bank of England worked to liquefy the
gold market. With the short-term supply shortage eased, the gold price corrected
down to close the calendar year at $290.00 an ounce, up 1.2% for the year.

Gold mining shares tracked the gold price, although excessive hedging operations
by a few of the mines created a negative sentiment toward the industry in
general as individual company positions were evaluated by the market. Your Fund
has maintained its strategy of concentrating the largest percentage of its
assets in unhedged to lightly hedged companies, such as Newmont Mining and
Homestake Mining. We believe your Fund is well positioned to participate in a
rising gold price environment.

With the agreement by the European central banks to limit gold sales in place,
the position of over 80% of the gold reserves held by central banks is now
clarified. The gold market should shift its attention away from central bank
activity in the coming year toward more fundamental economic issues. In our
opinion, the main influencing factor will be the excess credit creation in the
United States that is helping to fuel a widening U.S. trade and current account
deficit while encouraging speculative activity on Wall Street. Historically, a
period of a readjustment follows binges of excess credit as international
capital flows revalue paper currencies ultimately against gold.

-18-

<PAGE>

MONTEREY FUNDS
PERFORMANCE RESULTS - YEAR ENDED NOVEMBER 30, 1999
(ALL PERFORMANCE MEASUREMENTS REFLECT THE MAXIMUM SALES LOAD CHARGED,
FOR EACH PERIOD SHOWN.)

CAMBORNE
GOVERNMENT INCOME

AVERAGE ANNUAL TOTAL RETURNS VALUE ON 11/30/99
- ---------------------------- -----------------
1 year (5.58%) Camborne Gov't. $14,791
5 years 7.39% Lehman Index $15,698
Inception 5.68%

$10,000 Investment made 10/31/92 (date PIA became investment adviser)

Past performance is not The Lehman Government Index is an
predictive of future performance unmanaged index consisting of all
US Treasury & Agency bonds weighted
according to market capitalization.

The CAMBORNE GOVERNMENT INCOME FUND lost 1.15% (excluding sales charge) this
year versus the unmanaged Lehman Government Index loss of 1.38%. The Fund is
invested in US Government securities, Corporates and mortgage-backed securities.
The active duration management of the Fund, as well as its overweight in
mortgage-backed securities contributed to the Fund's performance. The manager
will continue active maturity management and sector rotation of the Fund to
attempt to capitalize on investment opportunities.

PIA EQUITY

AVERAGE ANNUAL TOTAL RETURNS VALUE ON 11/30/99
- ---------------------------- -----------------
1 year 7.03% PIA Equity $11,412
Inception 4.56% S&P 500 $19,599

$10,000 Investment made 12/13/96 (date PIA became investment adviser)

Past performance is not The S&P 500 Index is a broad
predictive of future performance unmanaged index generally
considered to be representative of
the US equity market.

The PIA EQUITY FUND returned 12.07% for the fiscal year, significantly
underperforming the S&P 500. The more closely related Russell 2000 index of
small capitalization companies returned 15.53% in the same period. The manager
believes that the Fund is well positioned to take advantage of the recovery of
the small cap sector which it expects over the coming year.

-19-

<PAGE>

Monterey Mutual Funds
Distributed by:

Syndicated Capital, Inc.
1299 Ocean Avenue, Suite 210
Santa Monica, CA 90401

<PAGE>

MONTEREY
FUNDS

- PIA SHORT-TERM GOVERNMENT SECURITIES

- PIA TOTAL RETURN BOND

- PIA GLOBAL BOND

MONTEREY
MUTUAL
FUND

ANNUAL REPORT
NOVEMBER 30, 1999

<PAGE>

Dear Shareholder:

We are pleased to provide you with this annual report for the year ended
November 30, 1999 for the following series of the Monterey Mutual Funds: the PIA
Short-Term Government Securities Fund, the PIA Total Return Bond Fund, and the
PIA Total Return Bond Fund.

During the 12 months ended November 30, 1999, the returns including the
reinvestment of dividends and capital gains, were as follows:

PIA Short-Term Government Securities Fund ............ 3.0%
PIA Total Return Bond Fund ........................... (0.7%)
PIA Global Bond Fund ................................. (4.8%)

Interest rates increased in 1999 due largely to the expectation that strong and
expansionary economic growth would occur in both the United States and other
developing economies. These increases in interest rate resulted in bond market
value declines that either completely or partially offset the higher rates in
interest earned on these bonds.

As examples of the effect of rising interest rates during this period ending
November 30, 1999, the Lehman US Government 1-3 Year Bond index increased in
value by 3.3%, the Lehman Government/Corporate Bond index declined by 1.3% and
the Salomon World Bond Index declined by 2.1%.

With long term Treasury Bonds now yielding significantly more than 6% and with
the perceived low core rate on inflation, the prospect for continued increases
in interest rates does not appear to be high since real rates of interest are at
historically high levels.

Please take a moment to review your Fund(s)' statement of assets and results of
operations for the year ended November 30, 1999. We look forward to reporting to
you in six months.

/S/ LLOYD MCADAMS
- -----------------
Lloyd McAdams
Chairman of the Board

-2-

<PAGE>

MONTERY FUNDS
SCHEDULES OF INVESTMENTS - NOVEMBER 30, 1999

PIA SHORT-TERM GOVERNMENT SECURITIES FUND
- --------------------------------------------------------------------------------
PRINCIPAL
VALUE VALUE
- --------------------------------------------------------------------------------

DEBT SECURITIES 96.89%
MORTGAGE BACKED 17.54%
<C> <S> <C>
$1,290,771 Bear Sterns Mortgage Sec. Inc., 7.00% due 11/25/10 .. $1,258,225
520,000 Contimortgage Home Equity Loan Tr,
6.28% due 12/25/19 ................................ 508,334
805,118 Countrywide Home Loans, Inc., 8.00% due 08/25/27 .... 811,991
1,120,895 Fairbanks Capital Inc., 5.81% due 05/25/28. ......... 1,120,895
434,140 Green Tree Recreational Corp.,
6.55% due 07/15/28 ................................ 431,069
504,960 LB Commercial Conduit Mortgage Tr.,
7.20% due 08/25/04 ................................ 508,134
243,508 Norwest Asset Sec. Corp., 7.00% due 04/25/12 ........ 243,564
37,975 Prudential Home Ser 1993-59,
7.125% due 12/25/00 ............................... 37,952
1,000,000 Prudential Home Ser 1993-9, 7.50% due 03/25/08 ...... 1,009,345
1,553,975 Resolution Trust Corp., 8.00% due 06/25/26 .......... 1,553,222
500,000 Salomon Brothers 1997-LB6, 6.91% due 12/25/27 ....... 500,058
347,640 Security National Mortgage Loan Tr.,
7.171% due 02/25/06 ............................... 341,676
----------
8,324,465
----------

GOVERNMENT AGENCIES 40.25%
426,230 FHLMC M80409, 6.00% due 01/01/03 .................... 412,796
101,681 FHLMC N96340, 6.00% due 04/01/03 .................... 98,477
179,968 FHLMC N96342, 6.00% due 04/01/03 .................... 174,296
153,399 FHLMC N96369, 6.00% due 04/01/03 .................... 148,565
315,584 FHLMC N96446, 6.50% due 04/01/03 .................... 310,573
137,445 FHLMC N96415, 6.50% due 05/01/03 .................... 135,262
473,217 FHLMC M80478, 7.00% due 06/01/04 .................... 473,887
131,576 FHLMC N96779, 6.50% due 08/01/03 .................... 129,487
319,798 FHLMC L80125, 6.50% due 08/01/03 .................... 314,719
249,810 FHLMC L80218, 6.50% due 09/01/03 .................... 245,843
989,586 FHLMC 1232F, 7.50% due 09/15/06 ..................... 999,154
120,938 FHLMC 609231, 5.61% due 02/01/24 .................... 124,709
308,856 FHLMC ARM 755204, 8.06% due 08/01/15 ................ 316,675
512,672 FHLMC ARM 635206, 6.89% due 10/01/22 ................ 518,602
1,762,730 FHLMC ARM 323802, 6.92% due 04/01/27 ................ 1,773,575
505,749 FNMA CMO 415842, 11.00% due 01/01/13 ................ 539,693
1,000,000 FNMA FNR 1992-22 HA, 7.00% due 11/25/05 ............. 1,003,485
1,617,763 GNMA ARM 80013, 7.00% due 11/20/26 .................. 1,622,319
1,011,546 GNMA ARM 80021, 6.13% due 12/20/26 .................. 1,027,112
429,843 GNMA ARM 80029, 6.38% due 01/20/27 .................. 436,020
571,100 GNMA ARM 80122, 6.13% due 10/20/27 .................. 579,462

See notes to financial statements

-3-

<PAGE>

MONTERY FUNDS
SCHEDULES OF INVESTMENTS - NOVEMBER 30, 1999

PIA SHORT-TERM GOVERNMENT SECURITIES FUND (CONTINUED)
- --------------------------------------------------------------------------------
PRINCIPAL
VALUE VALUE
- --------------------------------------------------------------------------------

GOVERNMENT AGENCIES 40.25% (CONTINUED)
$ 951,845 GNMA ARM 80143, 6.00% due 12/20/27 .................. $ 953,637
4,265,654 GNMA ARM 80154, 6.38% due 01/20/28 .................. 4,277,133
2,142,286 GNMA ARM 8062, 6.13% due 10/20/22 ................... 2,174,136
308,228 GNMA ARM 8871, 6.13% due 11/20/21 ................... 313,073
----------
19,102,690
----------

U.S. TREASURY NOTES 39.10%
9,500,000 U.S. Treasury Note, 5.125% due 08/31/00 ............. 9,455,474
2,650,000 U.S. Treasury Note, 4.00% due 10/31/00 .............. 2,606,938
3,500,000 U.S. Treasury Note, 5.50% due 12/31/00 .............. 3,486,875
675,000 U.S. Treasury Note, 7.75% due 02/15/01 .............. 688,922
1,000,000 U.S. Treasury Note, 6.625% due 06/30/01 ............. 1,007,813
1,300,000 U.S. Treasury Note, 6.375% due 09/30/01 ............. 1,307,719
----------
18,553,741
----------

TOTAL DEBT SECURITIES
(cost $46,338,768) .................................. $45,980,896

SHORT TERM INVESTMENTS 1.60%
757,986 Firstar Treasury Fund
(cost $757,896) ................................... 757,896

TOTAL INVESTMENTS
(cost $47,096,664) .................... 98.49% 46,738,792
OTHER ASSETS LESS LIABILITIES ...................... 1.51% 716,462
------- -----------
TOTAL NET ASSETS ................................... 100.00% $47,455,254
======= ===========

PIA TOTAL RETURN BOND FUND
- --------------------------------------------------------------------------------
SHARES VALUE
- --------------------------------------------------------------------------------

PREFERRED STOCK 1.22%
11,300 New Plan Excel Realty Trust Inc. Pfd B .............. $ 244,362
6,000 Thornburg Mortgage Asset Corp. Series A ............. 119,625
-----------
TOTAL PREFERRED STOCK
(cost $420,386) ................................... 363,987
-----------

PRINCIPAL
VALUE VALUE
- --------------------------------------------------------------------------------
LONG TERM INVESTMENTS 97.03%
MORTGAGE BACKED SECURITIES 13.55%
$ 16,792 Aetna Commercial Mortgage Trust,
1995-C5 A2, due 12/26/30 .......................... 16,731
308,853 BA Mortgage Securities Inc., due 10/25/27 ........... 301,264
298,845 Blackrock Capital Finance L.P. 1997 R1
due 03/25/37 ...................................... 286,519
184,184 CAPCO 1998-D7-A-1A, due 12/15/07 .................... 173,860
175,000 Carousel Center Finance Inc. A1,
due 11/15/07 ...................................... 173,543
280,000 Chase Mortgage Finance Corp., due 06/25/25 .......... 268,625
77,996 Countrywide Funding Corp., due 10/25/17 ............ 78,289
487,181 DLJ Mortgage Acceptance Corp.,
1994-MF11 A1, due 06/18/04 ........................ 505,303
6,345 FBC Mortgage Securities B2, due 08/20/09 ............ 6,364
8,972 FDIC Remic Trust 1994-C1 2A2, due 09/25/25 .......... 8,986
71,847 FDIC Remic Trust 1996-C1 1A, due 05/25/26 ........... 71,005
225,106 Lehman Structured Securities Corp.,
7.995% due 06/25/26. .............................. 226,806

* Non income producing security

See notes to financial statements

-4-

<PAGE>

MONTERY FUNDS
SCHEDULES OF INVESTMENTS - NOVEMBER 30, 1999

MORTGAGE BACKED SECURITIES 13.55% (continued)
$ 24,875 Prudential Home Mortgage 1993-59 A5,
due 12/25/00 ...................................... $ 24,828
200,000 SASCO 1995-C4 D, due 06/25/26 ....................... 197,597
484,038 SASCO 1998-C3A E, due 06/25/01 ...................... 474,080
180,505 Security National Mortgage Loan Trust,
due 02/25/06 ...................................... 177,409
800,000 Structured Asset Securities Corp.,
1996-CFL C, due 02/25/28 .......................... 792,940
236,546 Structured Settlements 99-A A, due 12/20/15 ......... 232,333
-----------
4,016,482
-----------

asset backed securities 5.35%
365,000 California Infrastructure PG&E, 1997-A7,
due 09/25/08 ...................................... 358,687
200,000 Cigna CBO 1996-1 A2, due 11/15/08 ................... 199,515
500,000 Rhyno CBO Delaware Corp., 1997-1 A2, due 09/15/09 ... 492,031
370,000 Team Fleet Financial 1998--3 A, due 10/25/04 ........ 351,731
183,100 UCFC Home Equity Loan 1995-A1,
A5, due 01/10/20 .................................. 184,736
-----------
1,586,700
-----------

CORPORATE BONDS 36.58%
AEROSPACE/DEFENSE 1.71%
361,638 Airplanes Passthrough Trust, 8.15% due 03/15/19 ..... 339,866
175,000 Lockheed Martin Marietta, 7.00% due 03/15/11 ........ 166,117
-----------
505,983
-----------
AIRLINES 0.08%
25,000 Southwest Air, 7.375% due 03/01/27 .................. 23,729

AUTOMOTIVE 1.47%
210,000 Ford Motor Credit, 9.14% due 12/30/14 ............... 227,938
210,000 General Motors Acceptance Corp.,
5.875% due 01/22/03 ............................... 206,491
-----------
434,429
-----------

BANKING & FINANCIAL SERVICES 10.05%
135,000 Banc One Corp., 7.625% due 10/15/26 ................. 131,751
175,000 BankBoston, 6.375% due 03/25/08 ..................... 164,419
340,000 Bankers Trust, 8.125% due 04/01/02 .................. 347,990
185,000 Bear Sterns Co., 7.00% due 03/01/07 ................. 179,591
335,000 Countrywide Home Loan, 7.26% due 05/10/04 ........... 336,418
160,000 Fairfax Financial Holdings 144A, 7.375%
due 03/15/06 ...................................... 155,428
160,000 First Bank System, 7.625% due 05/01/05 .............. 164,910
270,000 Freemont General Corp. 144A, 7.875% due 03/17/09 .... 229,155
255,000 General Electric Capital, 8.875% due 05/15/09 ....... 285,667
225,000 Lehman Brothers Holdings, 6.50% due 10/01/02 ........ 220,095
280,000 Merit Securities Corp., 7.88% due 12/28/33 .......... 280,087
170,000 Morgan Stanley Group, 6.875% due 03/01/07 ........... 166,832
315,000 PNC Bank Corp., 7.875% due 04/15/05 ................. 319,951
-----------
2,982,294
-----------

See notes to financial statements

-5-

<PAGE>

MONTERY FUNDS
SCHEDULES OF INVESTMENTS - NOVEMBER 30, 1999

CHEMICALS 0.66%
$ 205,000 Eastman Chemical Co., 6.375% due 01/15/04 ........... $ 197,105
-----------

COMPUTERS,/SOFTWARE .56%
175,000 Computer Associates International, 6.375% due 04/15/05 164,919
-----------

CRUISELINES 1.10%
180,000 Carnival Corp., 6.15% due 04/15/08 .................. 168,101
165,000 Royal Caribbean Cruises, 7.00% due 10/15/07 ......... 157,195
-----------
325,296
-----------

DIVERSIFIED MINERALS 0.65%
200,000 American Re Corp., 7.45% due 12/15/26 ............... 192,042
-----------

ELECTRONIC COMPONENTS/SEMICONDUCTORS 1.16%
180,000 Applied Materials, 6.75% due 10/15/07 ............... 173,389
180,000 Thomas & Betts Corp., 6.625% due 05/07/08 ........... 169,885
-----------
343,274
-----------

HOTELS 1.25%
220,000 Marriott International 144A, 6.875% due 11/15/05 .... 209,972
175,000 Mirage Resorts Inc., 7.25% due 10/15/06 ............. 161,693
-----------
371,665
-----------
INSURANCE 2.74%
205,000 Aetna Services Inc., 7.125% due 08/15/06 ............ 199,222
170,000 CNA Financial Corp., 6.50% due 04/15/05 ............. 161,812
215,000 Conseco Inc., 6.40% due 06/15/01 .................... 207,791
110,000 First Security Corp., 6.875% due 11/15/06 ........... 106,378
140,000 ITT Hartford Group, 6.375% due 11/01/02 ............. 138,319
-----------
813,522
-----------

MULTIMEDIA 0.63%
190,000 Time Warner Entertainment, 7.25% due 09/01/08 ....... 188,398
-----------

PIPELINE 0.63%
175,000 Questar Pipeline Corp., 9.375% due 06/01/21 ......... 187,317
-----------

REAL ESTATE & MORTGAGE RELATED 5.05%
305,000 Chateau Properties Limited Partnership,
8.75% due 03/02/00 ................................ 305,956
270,000 Health Care Properties Inc., 6.50% due 02/15/06 ..... 228,601
191,000 Kimco Realty Corp., 6.50% due 10/01/03 .............. 183,918
150,000 Nationwide Health Properties Inc., 8.67%
due 03/10/05 ...................................... 141,144
205,000 Security Cap. Industrial, 7.625% due 07/01/17 ....... 186,306
160,000 Southern Investments UK, 6.80% due 12/01/06 ......... 152,140
310,000 United Dominion Realty Trust Inc., 7.95%
due 07/12/06 ...................................... 299,321
-----------
1,497,386
-----------

See notes to financial statements

-6-

<PAGE>

MONTERY FUNDS
SCHEDULES OF INVESTMENTS - NOVEMBER 30, 1999

RETAIL 1.70%
$ 350,000 Ikon Office Solutions Inc., 6.75% due 11/01/04 ...... $ 325,349
190,000 J.C. Penney & Co., 7.60% due 04/01/07 ............... 177,537
-----------
502,886
-----------

TELECOMMUNICATIONS 2.57%
175,000 Airtouch Communications, 6.65% due 05/01/08 ......... 167,185
240,000 AT&T Corp., 6.00% due 03/15/09 ...................... 221,440
205,000 Frontier Corp., 7.25% due 05/15/04 .................. 205,596
165,000 Worldcom Inc., 7.55% due 04/01/04 ................... 168,618
-----------
762,839
-----------

TRANSPORTATION 2.14%
170,000 AMR Corp., 10.05% due 03/07/06 ...................... 188,684
165,000 Canadian National Railway, 7.00% due 03/15/04 ....... 164,721
296,855 Federal Express Etc., 6.845% due 01/15/19 ........... 280,322
-----------
633,727
-----------

UTILITIES 2.43%
300,000 AES Ironwood LLC, 8.857% due 11/30/25. .............. 300,000
80,000 Southern California Edison, 6.65% due 04/01/29. ..... 156,147
260,000 Virginia Electric & Power, 8.75% due 04/01/21 ....... 265,273
-----------
721,420
-----------

U.S. GOVERNMENT SECURITIES 41.55%
GOVERNMENT AGENCIES 24.39%
$120,000 Fannie Mae X-130A H, 6.30% due 09/25/18 ............. $119,193
322,000 FHG 42 I, 8.00% due 10/17/24 ........................ 334,547
100,000 FHLMC 1704 E, 6.50% due 03/15/09 .................... 96,374
250,000 FHLMC 1312 I, 8.00% due 07/15/22. .................. 255,535
107,830 FNMA ARM 162881, 7.43% due 06/01/18 ................. 109,987
4,818 FNMA 1992-12 SA, 9.33% due 01/25/22 ................. 4,476
635,393 FNMA Pool 313947, 7.00% due 01/01/28 ................ 621,206
871,200 FNMA 429618, 6.50% due 07/01/28 ..................... 830,973
92,059 FNMA 443589, 6.50% due 10/01/28 ..................... 87,809
1,480,810 FNMA Pool 495378, 6.00% due 04/01/29 ................ 1,373,419
1,376,572 FNMA Pool 502454, 6.50% due 07/01/29 ................ 1,313,009
1,383 GNMA 175288, 8.75% due 09/15/01 ..................... 1,410
699 GNMA 198340, 8.75% due 02/15/02 ..................... 716
540,000 GNMA 1996-4 N, 7.00% due 04/16/26 ................... 521,434
632,556 GNMA 501569, 7.50% due 03/15/29 ..................... 631,282
952,968 GNMA 5036003, 7.50% due 04/15/29 .................... 930,407
-----------
7,231,777
-----------

U.S. TREASURY NOTES 17.16%
200,000 U.S. Treasury Note, 5.50% due 12/31/00 .............. 199,250
1,800,000 U.S. Treasury Note, 5.75% due 10/31/02 .............. 1,787,063
470,000 U.S. Treasury Note, 5.25% due 08/15/03 .............. 456,928
350,000 U.S. Treasury Note, 6.50% due 10/15/06 .............. 354,266
530,000 U.S. Treasury Note, 6.125% due 11/15/27 ............. 505,081
300,000 U.S. Treasury Note, 5.25% due 11/15/28 .............. 253,406
880,000 U.S. Treasury Note, 5.50% due 08/15/28 .............. 770,000
900,000 U.S. Treasury Note, 5.25% due 02/15/29 .............. 763,594
-----------
5,089,588
-----------

See notes to financial statements

-7-

<PAGE>

MONTERY FUNDS
SCHEDULES OF INVESTMENTS - NOVEMBER 30, 1999

PIA TOTAL RETURN BOND FUND (CONTINUED)
- --------------------------------------------------------------------------------
PRINCIPAL
VALUE VALUE
- --------------------------------------------------------------------------------
TOTAL LONG TERM INVESTMENTS
(cost $29,838,097) .................................. $28,772,778
-----------

SHORT TERM INVESTMENTS 1.08%
$ 316,467 Star Treasury Fund
(cost $316,467) ................................... 316,467
-----------

TOTAL INVESTMENTS
(cost $30,574,950) ................ 99.33% 29,453,232
OTHER ASSETS LESS LIABILITIES .................. 0.67% 198,799
------- -----------
TOTAL NET ASSETS ....................... 100.00% $29,652,031
======= ===========

PIA GLOBAL BOND FUND
- --------------------------------------------------------------------------------
PRINCIPAL
VALUE + VALUE
- --------------------------------------------------------------------------------
LONG TERM INVESTMENTS 96.67%
FOREIGN GOVERNMENT OBLIGATIONS 44.70%
CANADA
1,000,000C Canadas-Government, 5.25% due 09/01/03 .............. $ 691,302

FRANCE
700,000 France O.A.T., 4.00% due 04/25/99 ................... 639,628

GERMANY
715,808E Bundes Obligations 114, 6.50% due 03/15/00 .......... 726,997
409,033E Bundes Republic Deutschland, 114, 6.00% due 07/04/07 433,680

ENGLAND
60,000 Credit Suisse FB, 8.50% due 11/18/04 ................ 61,385
-----------
2,552,992
-----------

MORTGAGE-BACKED SECURITIES 6.02%
16,292 Countrywide Funding Corp., 11.113% due 10/25/17 ..... 16,353
105,000 FHLMC CMO, 6.50% due 11/15/23 ....................... 98,270
4,425 FNMA 251614, 7.00% due 07/01/28 ..................... 4,326
23,462 FRN 97-27A, 7.00% due 09/18/21 ...................... 23,453
100,000 HRFT Properties Trust, 6.56% due 7/10/00 ............ 99,907
100,000 Prudential Home Mortgage Securities,
7.50% due 03/25/08 ................................ 100,934
-----------
343,243
-----------

U.S. GOVERNMENT SECURITIES 45.95%
210,000 U.S. Treasury Notes, 4.00% due 10/31/00 ............. 206,588
40,000 U.S. Treasury Notes, 5.00% due 04/30/01 ............. 39,500

+ US Dollars unles indicated otherwise
C Canadian Dollars
E Euro

See notes to financial statements

-8-

<PAGE>

MONTERY FUNDS
SCHEDULES OF INVESTMENTS - NOVEMBER 30, 1999

PIA GLOBAL BOND FUND (CONTINUED)
- --------------------------------------------------------------------------------
PRINCIPAL
VALUE VALUE
- --------------------------------------------------------------------------------

U.S. GOVERNMENT SECURITIES 45.95% (continued)
$ 40,000 U.S. Treasury Notes, 5.50% due 07/31/01 ............. $ 39,700
250,000 U.S. Treasury Notes, 6.25% due 01/31/02 ............. 251,250
320,000 U.S. Treasury Notes, 5.375% due 06/30/03 ............ 312,900
230,000 U.S. Treasury Notes, 4.25% due 11/15/03 ............. 215,409
1,050,000 U.S. Treasury Notes, 6.50% due 10/15/26 ............. 1,062,797
70,000 U.S. Treasury Notes, 6.125% due 11/15/27 ............ 66,719
50,000 U.S. Treasury Notes, 6.375% due 8/15/27 ............. 49,141
280,000 U.S. Treasury Notes, 5.50% due 08/15/28 ............. 245,000
160,000 U.S. Treasury Notes, 5.25% due 11/15/28 ............. 135,150
-----------
2,624,154
-----------

TOTAL LONG TERM INVESTMENTS
(cost $5,843,064) ................................... 5,520,389
-----------

SHORT TERM INVESTMENTS 1.07%
61,206 Firstar Treasury Fund
(cost $61,206) .................................... 61,206
-----------

TOTAL INVESTMENTS
(cost $5,904,270) ............ 97.74% 5,581,595
OTHER ASSETS LESS LIABILITIES ............... 2.26% 129,346
------- -----------
TOTAL NET ASSETS ............................ 100.00% $ 5,710,941
======= ===========
<FN>

+ US Dollars unless indicated otherwise
</FN>
</TABLE>

See notes to financial statements

-9-

<PAGE>

MONTERY FUNDS
STATEMENTS OF ASSETS AND LIABILITIES - NOVEMBER 30, 1999

PIA PIA
SHORT TERM TOTAL
GOVERNMENT RETURN PIA
SECURITIES BOND GLOBAL BOND
----------------------------------------------
ASSETS
<S> <C> <C> <C>
Investments in securities, at value
(cost $47,096,664, $30,574,950 and
$5,904,270,respectively) ........................ $ 46,738,792 $ 29,453,232 $ 5,581,595
Receivable for fund shares sold ........................ 350,000 50,000 0
Income receivable ...................................... 426,321 336,557 135,876
Due from investment adviser (Note 3) ................... 0 0 2,807
Prepaid expenses and other ............................. 1,462 2,376 3,037
------------ ------------ ------------
Total assets ................................... 47,516,575 29,842,165 5,723,315
------------ ------------ ------------

LIABILITIES
Payable for securities purchased ....................... 0 114,644 0
Dividends payable ...................................... 38,908 40,542 1,954
Due to investment adviser (Note 3) ..................... 1,274 2,003 0
Accrued expenses and other ............................. 21,139 32,945 10,420
------------ ------------ ------------
Total liabilities .............................. 61,321 190,134 12,374
------------ ------------ ------------

NET ASSETS
Shares of beneficial interest, no par value;
unlimited shares authorized ..................... 47,989,963 31,292,514 6,105,098
Undistributed net investment income .................... 6,581 7,241 0
Accumulated net realized (loss)on
investments and foreign currencies ............. (183,418) (526,006) (65,931)
Net unrealized (depreciation)
on investments and foreign currencies .......... (357,872) (1,121,718) (328,226)
------------ ------------ ------------
Net assets ..................................... $ 47,455,254 $ 29,652,031 $ 5,710,941
============ ============ ============

Net asset value, offering and redemption price per share $ 10.07 $ 18.92 $ 19.24
------------ ------------ ------------
Shares outstanding ..................................... 4,714,305 1,567,443 296,789
============ ============ ============

</TABLE>

See notes to financial statements

-10-

<PAGE>

MONTERY FUNDS
STATEMENTS OF OPERATIONS - FOR THE YEAR ENDED NOVEMBER 30, 1999

PIA PIA
SHORT TERM TOTAL
GOVERNMENT RETURN PIA
SECURITIES BOND GLOBAL BOND
-----------------------------------------

Investment Income
Interest ........................................ $ 2,930,852 $ 1,801,642 $ 322,210
Dividends ....................................... 0 23,719 0
----------- ----------- -----------
Total investment income ................. 2,930,852 1,825,361 322,210
----------- ----------- -----------

Expenses
Adviser fees (Note 3) ........................... 102,873 84,763 24,615
Distribution fees (Note 4) ...................... 25,718 0 0
Transfer agent fees ............................. 8,044 8,284 15,686
Administrative fees (Note 3) .................... 45,730 37,708 16,904
Custodian fees .................................. 25,428 20,352 8,303
Audit fees ...................................... 7,155 7,405 7,155
Legal fees ...................................... 5,240 5,426 4,516
Registration fees ............................... 9,557 8,765 3,363
Trustees' fees .................................. 1,263 1,585 1,263
Printing expense ................................ 2,826 783 915
Amortization of deferred organization expenses .. 0 0 239
Postage expense ................................. 621 351 50
Other expenses .................................. 7,563 3,574 1,772
----------- ----------- -----------
Total expenses .......................... 242,018 178,996 84,781
Less: Expense reimbursement from adviser (Note 3) (87,808) (65,679) (53,126)
----------- ----------- -----------
Net expenses ............................ 154,210 113,317 31,655
----------- ----------- -----------
Net investment income (loss) ............ 2,776,642 1,712,044 290,555
----------- ----------- -----------

Realized and Unrealized Gain
(Loss) on Investments
Net realized loss on investments
and foreign currencies .................. (157,319) (526,006) (58,284)
Net unrealized appreciation (depreciation) on
investments and foreign currencies ...... (1,118,845) (1,341,005) (538,923)
----------- ----------- -----------
Net (loss) on investments ....................... (1,276,164) (1,867,061) (597,207)
----------- ----------- -----------
Net increase (decrease) in net assets
resulting from operations ............... $ 1,500,478 $ (155,017) $ (306,652)
=========== =========== ===========

</TABLE>
See notes to financial statements

-11-

<PAGE>

MONTERY FUNDS
STATEMENTS OF CHANGES IN NET ASSETS

PIA
SHORT TERM PIA
GOVERNMENT TOTAL
SECURITIES RETURN BOND
-------------------------------------------------------------------

Year ended Year ended Year ended For the Period
Nov. 30, Nov. 30, Nov. 30, Sept. 1, 1998*
1999 1998 1999 to Nov. 30, 1998
-------------------------------------------------------------------

OPERATIONS
<S> <C> <C> <C> <C>
Net investment income (loss) ............. $ 2,776,642 $ 3,102,418 $ 1,712,044 $ 316,553
Net realized gain (loss) on
investments and foreign currencies (157,319) 284,717 (526,006) 39,937
Net unrealized appreciation
(depreciation) on investments and
foreign currencies ....................... (1,118,845) 501,366 (1,341,055) 219,337
------------ ------------ ------------ ------------
Net increase (decrease) in net assets
resulting from operations ........ 1,500,478 3,888,501 (155,017) 575,827
------------ ------------ ------------ ------------

DIVIDENDS PAID TO SHAREHOLDERS
Dividends from net investment income ..... (2,770,061) (3,102,418) (1,705,557) (306,509)
Distributions from net realized gains .... (305,161) (50,168) (49,227) 0
------------ ------------ ------------ ------------
(3,075,222) (3,152,586) (1,754,784) (306,509)
------------ ------------ ------------ ------------
FUND SHARE TRANSACTIONS
Net proceeds from shares sold ............ 10,442,572 13,650,663 9,966,142 24,563,866
Dividends reinvested ..................... 2,739,662 3,115,877 1,193,499 225,825
Payment for shares redeemed .............. (21,141,334) (13,425,643) (4,541,644) (115,174)
------------ ------------ ------------ ------------
Net increase (decrease) in net assets
from fund share transactions ..... (7,959,100) 3,340,897 6,617,997 24,674,517
------------ ------------ ------------ ------------
Net increase (decrease) in net assets .... (9,533,844) 4,076,812 4,708,196 24,943,835
NET ASSETS, Beginning of Year ............ 56,989,098 52,912,286 24,943,835 0
------------ ------------ ------------ ------------
NET ASSETS, End of Year .................. $ 47,455,254 $ 56,989,098 $ 29,652,031 $ 24,943,835
============ ============ ============ ============

CHANGES IN SHARES OUTSTANDING
Shares sold .............................. 1,024,239 1,325,769 509,738 1,225,259
Shares issued on reinvestment
of dividends ..................... 269,057 301,984 61,491 11,048
Shares redeemed .......................... (2,069,018) (1,296,941) (234,458) (5,635)
------------ ------------ ------------ ------------
Net increase (decrease) in
shares outstanding ............... (775,722) 330,812 336,771 1,230,672
============ ============ ============ ============

PIA
GLOBAL BOND
-----------------------------

Year ended Year ended
Nov. 30, Nov. 30,
1999 1998
-----------------------------

OPERATIONS
Net investment income (loss) ............. $ 290,555 $ 302,375
Net realized gain (loss) on
investments and foreign currencies (58,284) 62,461
Net unrealized appreciation
(depreciation) on investments and
foreign currencies ....................... (538,923) 226,129
------------ ------------
Net increase (decrease) in net assets
resulting from operations ........ (306,652) 590,665
------------ ------------

DIVIDENDS PAID TO SHAREHOLDERS
Dividends from net investment income ..... (296,220) (313,779)
Distributions from net realized gains .... (33,883) 0
------------ ------------
(330,103) (313,779)
------------ ------------
FUND SHARE TRANSACTIONS
Net proceeds from shares sold ............ 714,990 1,572,860
Dividends reinvested ..................... 317,390 303,567
Payment for shares redeemed .............. (742,405) (1,680,979)
------------ ------------
Net increase (decrease) in net assets
from fund share transactions ..... 289,975 195,448
------------ ------------
Net increase (decrease) in net assets .... (346,780) 472,834
NET ASSETS, Beginning of Year ............ 6,057,721 5,584,887
------------ ------------
NET ASSETS, End of Year .................. $ 5,710,941 $ 6,057,721
============ ============

CHANGES IN SHARES OUTSTANDING
Shares sold .............................. 34,047 77,100
Shares issued on reinvestment
of dividends ..................... 15,668 14,734
Shares redeemed .......................... (37,144) (82,376)
------------ ------------
Net increase (decrease) in
shares outstanding ............... 12,571 9,458
============ ============

<FN>

*Commencement of operations
</FN>

</TABLE>

See notes to financial statements

-12-

<PAGE>

MONTERY FUNDS
NOTES TO FINANCIAL STATEMENTS - NOVEMBER 30, 1999

NOTE 1. ORGANIZATION
Monterey Mutual Fund (the "Trust"), formerly Monitrend Mutual Fund, is
registered under the Investment Company Act of 1940, as amended, as a
diversified, open-end management investment company. The Trust was organized as
a Massachusetts business trust on January 6, 1984 and consists of nine series of
shares: the PIA Short Term Government Securities Fund, the Camborne Government
Income Fund, the OCM Gold Fund, the PIA Equity Fund, the Murphy New World
Biotechnology Fund, the Murphy New World Technology Fund, the Murphy New World
Technology Convertibles Fund, the PIA Global Bond Fund and the PIA Total Return
Bond Fund (collectively the "Funds"), each of which has separate assets and
liabilities and differing investment objectives. The investment objective for
each of the Funds presented herein are: the PIA Short Term Government Securities
Fund, (the "Short-Term Government Fund"), to provide investors a high level of
current income, consistent with low volatility of principal through investing in
short term, adjustable rate and floating rate securities issued or guaranteed by
the U.S. Government, its agencies or instrumentalities; the PIA Global Bond
Fund, (the "Global Bond Fund"), to provide a high level of current income
through investing in bonds denominated in U.S. dollars and other currencies; and
the PIA Total Return Bond Fund, (the "Total Return Bond Fund"), to maximize
total return through investing in bonds while minimizing risk as compared to the
market.

NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed
by the Fund in the preparation of their financial statements.

SECURITY VALUATION - Portfolio securities that are listed on the
national securities exchanges are valued at the last sale price as of the close
of such securities exchanges, Eastern time, or, in the absence of recorded
sales, at the average of readily available closing bid and asked prices on such
exchanges. Unlisted securities are valued at the average of the quoted bid and
asked prices in the over-the-counter market. Securities and other assets for
which market quotations are not readily available are valued at fair market
value as determined in good faith by the Adviser under procedures established by
and under the general supervision and responsibility of the Trust's Board of
Trustees. Short-term investments which mature in less than 60 days are valued at
amortized cost (unless the Board of Trustees determines that this method does
not represent fair market value). Short-term investments which mature after 60
days are valued at market. Stock Index Futures, which are traded on commodities
exchanges, are valued at their last sales price as of the close of such
commodities exchanges.

OPTIONS - When a call is written, an amount equal to the premium
received is included in the Statement of Assets and Liabilities as an equivalent
liability. The amount of the liability is subsequently marked to market to
reflect the current market value of the option written. If an option which was
written either expires on its stipulated expiration date, or a closing purchase
transaction is entered into, a gain is realized (or loss if the cost of a
closing purchase transaction exceeds the premium received when the option was
sold) without regard to any unrealized gain or loss on the underlying security,
and the liability related to such option is extinguished. If a written call
option is exercised, a capital gain or loss is realized from the sale of the
underlying security and the proceeds from such sale are increased by the premium
originally received.

FUTURES CONTRACTS - The Global Bond Fund and the Total Return Bond Fund
may from time to time enter into futures contracts as a hedge to provide
protection against adverse movements in the prices of securities in the
portfolio. When a Fund enters a futures contract, it is required to pledge to
the clearing broker an amount of cash and/or securities equal to approximately
5% of the contract amount. This amount is known as the "initial margin".
Pursuant to the futures contract, the Fund agrees to take or make delivery of an
amount of cash equal to a specified dollar amount times the difference between
the value at the close of the day and the price at which the futures contract
was originally struck. Such payments, known as the "variation margin", are
recorded by the Fund as unrealized gains or losses. When the futures contract
expires or is closed by the Fund it realizes a gain or loss.

FINANCIAL INSTRUMENTS WITH OFF BALANCE SHEET RISK - Futures contracts
involve elements of market risk and credit risk in excess of the amounts
reflected in the Statement of Assets and Liabilities. The contract amounts of
these futures contracts reflect the extent of exposure to off balance sheet
risk.

The predominant market risk is that movements in the prices of the
Trust's portfolio securities being hedged may not correlate perfectly with the
movement in the prices of the future contracts. The lack of correlation could
render the Trust's hedging strategy unsuccessful and could result in a loss to
the Trust.

-13-

<PAGE>

MONTERY FUNDS
NOTES TO FINANCIAL STATEMENTS - NOVEMBER 30, 1999

Futures contracts are purchased only on exchanges. The exchange acts as
the counterparty to the Trust's futures transactions; therefore the Trust's
credit risk is limited to failure of the exchange.

FEDERAL INCOME TAXES - It is each Trust's policy to meet the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable net income to its shareholders.
Therefore the Fund paid no Federal Income taxes and no Federal income tax
provision was required. At November 30, 1999, the Short-Term Government
Securities Fund and the Total Return Bond Fund have capital loss carryovers of
approximately $157,000 and $498,000, respectively.

ORGANIZATIONAL COSTS - These costs have been capitalized and are being
amortized using the straight-line method over a period of sixty months beginning
on commencement of operations.

OTHER - Securities transactions are recorded no later than the first
business day after the trade date. Discounts and premiums on securities
purchased are amortized over the life of the respective security. Realized gains
and losses on sales of securities are calculated on the identified cost basis.
Dividend income is recorded on the ex-dividend date. Interest income is recorded
on an accrual basis.

USE OF ESTIMATES - The preparation of financial statements in
conformity with generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of increases and decreases in
net assets from operations during the reporting period. Actual results could
differ from those estimates.

NOTE 3. INVESTMENT ADVISORY AND ADMINISTRATION AGREEMENTS
The Short-Term Government Fund, Global Bond Fund and the Total Return
Bond Fund each has an investment advisory agreement with PIA. Each Fund pays PIA
a fee, computed daily and payable monthly, at the annual rate of 0.20%, 0.40%
and 0.30%, respectively, of their net assets.

For the year ended November 30, 1999 the advisers agreed to reimburse
the Funds for expenses (except distribution fees) in excess of 0.30% of average
net assets of the Short-Term Government Fund, 0.51% of average net assets for
the Global Bond Fund, and 0.40% of average net assets of Total Return Bond Fund.

The Fund has a fund accounting and administrative agreement with
American Data Services, Inc. ("ADS"). ADS receives a fee, computed daily and
payable monthly, at an annual rate of 0.1% of average daily net assets, subject
to a monthly minimum.

NOTE 4. DISTRIBUTION AGREEMENT AND PLAN
Syndicated Capital, Inc. serves as the Distributor of each Funds
shares. The President and sole shareholder of the Distributor is also the
Chairman and majority shareholder of PIA, as well as a trustee of the Trust.

The Trust has adopted a Distribution Plan (the "Plan") pursuant to Rule
12b-1 under the Investment Company Act of 1940. The Plan authorizes the PIA
Short-Term Government Securities Fund to reimburse the Distributor for marketing
expenses incurred in distributing shares of each Fund, including the cost of
printing sales material and making payments to dealers in each Fund's shares, in
any fiscal year, subject to a limit of 0.05% for the Short-Term Government Fund.

NOTE 5. PURCHASES AND SALES OF SECURITIES
The cost of purchases and sales of investment securities (other than
short-term investments) for the year ended November 30, 1999, were as follows:

PURCHASES SALES
--------- -----
Short-Term Government Fund $ 55,102,510 $ 63,632,592
Total Return Fund 31,105,306 28,672,103
Global Bond Fund 5,522,168 5,193,643

The cost of securities for income tax purposes is the same as that
shown in the Schedules of Investments. Unrealized appreciation and depreciation
on investments at November 30, 1999 based on cost for Federal income taxes, are
as follows:

UNREALIZED UNREALIZED
APPRECIATION DEPRECIATION NET
------------ ------------ ---
Short-Term Government Fund $ 36,055 ($ 393,927) ($ 357,872)
Total Return Fund 13,897 (1,135,615) (1,121,718)
Global Bond Fund 27,004 (349,679) (322,675)

-14-

<PAGE>

MONTERY FUNDS
PIA SHORT-TERM GOVERNMENT SECURITIES
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)

Year ended Year ended Year ended Year ended Year ended
Nov. 30, Nov. 30, Nov. 30, Nov. 30, Nov. 30,
1999 1998 1997 1996* 1995*
------------------------------------------------------------------

<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ... $ 10.38 $ 10.26 $ 10.21 $ 10.12 $ 9.98
--------- ------- --------- --------- ---------

Income From Investment Operations
Net investment income .................. 0.55 0.57 0.61 0.56 0.57
Net realized and unrealized gain (loss)
on investments ................. (0.25) 0.13 0.06 0.19 0.14
--------- ------- --------- --------- ---------
Total from investment operations ....... 0.30 0.70 0.67 0.75 0.71

Less Distributions
Dividends from net investment income ... (0.55) (0.57) (0.61) (0.56) (0.57)
Distributions from net realized gains .. (0.06) (0.01) (0.01) (0.10) 0.00
--------- ------- --------- --------- ---------
Total distributions .................... (0.61) (0.58) (0.62) (0.66) (0.57)
--------- ------- --------- --------- ---------
Net asset value, end of period ......... $ 10.07 $ 10.38 $ 10.26 $ 10.21 $ 10.12
========= ======= ========= ========= =========
Total return ........................... 3.00% 6.99% 6.56% 7.68% 7.50%

Ratios/Supplemental Data
Net assets, end of period (in 000's) ... 47,455 56,989 52,912 20,464 3,405
Ratio of expenses to average net assets 0.30% 0.30% 0.30% 0.44% 0.46%
Ratio of expenses to average net assets,
before reimbursement ........... 0.47% 0.46% 0.55% 1.19% 2.01%
Ratio of net investment income to
average net assets ............. 5.40% 5.51% 5.77% 5.51% 5.71%
Portfolio turnover rate ................ 110.15% 138.44% 63.08% 21.54% 163.55%

<FN>

* Based on average shares outstanding
</FN>
</TABLE>

See notes to financial statements

-15-

<PAGE>

MONTERY FUNDS
PIA TOTAL RETURN BOND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)

Year Ended Sept. 1, 1998
Nov. 30, (Commencement
1999 of Operations)
through
Nov. 30, 1998
----------------------------

<S> <C> <C>
Net asset value, beginning of period ............ $ 20.27 $ 20.00
--------- ---------

Income From Investment Operations
Net investment income ........................... 1.16 0.27
Net realized and in unrealized gain (loss) on
investments and foreign currencies ............ (1.31) 0.26
--------- ---------
Total from investment operations ................ (0.15) 0.53
--------- ---------

Less Distributions
Dividends from net investment income ............ (1.16) (0.26)
Distributions from net realized gains ........... (0.04) 0.00
--------- ---------
Total distributions ............................. (1.20) (0.26)
--------- ---------
Net asset value, end of period .................. $ 18.92 $ 20.27
========= =========
Total return** .................................. (0.74%) 2.65%

Ratios/Supplemental Data
Net assets, end of period (in 000's) ............ 29,652 24,944
Ratio of expenses to average net assets ......... 0.40% .40%+
Ratio of expenses to average net assets,
before reimbursement .................... 0.63% 0.63%+
Ratio of net investment income to
average net assets ...................... 6.06% 5.49%+
Portfolio turnover rate ......................... 104.13% 13.22%

<FN>

+ Annualized
** Not annualized for periods less than a year.
</FN>
</TABLE>

See notes to financial statements

-16-

<PAGE>

MONTERY FUNDS
PIA GLOBAL BOND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)

Year ended Year ended April 1, 1997
Nov. 30, Nov. 30, (Commencement
1999 1998 of Operations)
through
Nov. 30, 1997
----------------------------------------

<S> <C> <C> <C>
Net asset value, beginning of period ........... $ 21.31 $ 20.33 $ 20.00
-------- -------- --------

Income From Investment Operations
Net investment income .......................... 0.90 0.99 0.50
Net realized and unrealized gain (loss) on
investments and foreign currencies .......... (1.89) 1.03 0.32
-------- -------- --------
Total from investment operations ............... (0.99) 2.02 0.82
-------- -------- --------

Less Distributions
Dividends from net investment income ........... (0.96) (1.04) (0.49)
Distributions from net realized gains .......... (0.12) 0.00 0.00
-------- -------- --------
Total distributions ............................ (1.08) (1.04) (0.49)
-------- -------- --------
Net asset value, end of period ................. $ 19.24 $ 21.31 $ 20.33
======== ======== ========
Total return** ................................. (4.78%) 10.23 4.15%

Ratios/Supplemental Data
Net assets, end of period (in 000's) ........... 5,711 6,058 5,585
Ratio of expenses to average net assets ........ 0.51% 0.52% .51%+
Ratio of expenses to average net assets ,
before reimbursement ................... 1.37% 1.38% 2.05%+
Ratio of net investment income (loss) to average
net assets ............................. 4.68% 4.80% 4.71%+
Portfolio turnover rate ........................ 86.40% 176.66% 82.47%

<FN>

+ Annualized
** Not annualized for periods less than a year
</FN>
</TABLE>

See notes to financial statements

-17-

<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Trustees and Shareholders of
Monterey Mutual Fund

In our opinion, the accompanying statements of assets and liabilities, including
the schedules of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of The PIA Short-Term Government
Securities Fund, the PIA Total Return Bond Fund and the PIA Global Bond Fund
series of Monterey Mutual Fund, (hereafter referred to as the "Trust") at
November 30, 1999, and the results of each of their operations, the changes in
each of their net assets and the financial highlights for the year then ended,
in conformity with generally accepted accounting principles. These financial
statements and financial highlights (hereafter referred to as "financial
statements") are the responsibility of the Trust's management; our
responsibility is to express an opinion on these financial statements based on
our audit. We conducted our audit of these financial statements in accordance
with generally accepted auditing standards, which 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, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audit, which included confirmation of securities at November
30, 1999 by correspondence with the custodian and brokers, provides a reasonable
basis for the opinion expressed above. The financial statements for the year
ended November 30, 1998 including the financial highlights for each of the four
years in the period then ended, were audited by other independent accountants
whose report dated January 8, 1999 expressed an unqualified opinion on those
financial statements.

PricewaterhouseCoopers LLP
New York, New York
December 17, 1999

-18-

<PAGE>

CHANGE IN INDEPENDENT ACCOUNTANT

On September 9, 1999, the Trust, with the approval of its Board of
Trustees and its Audit Committee, engaged PwC as its independent auditors.

-19-

<PAGE>

MONTEREY FUNDS
PERFORMANCE RESULTS - YEAR ENDED NOVEMBER 30, 1999

PIA SHORT-TERM
GOVERNMENT FUND

AVERAGE ANNUAL TOTAL RETURNS VALUE ON 11/30/99
- ---------------------------- -----------------
1 year 3.00% PIA ST Gov't. $13,916
5 year 6.33% Lehman Index $12,959
Inception 6.07%

$10,000 Investment made 4/22/94 (Inception Date)

Past performance is not The Lehman Government 1-3 Year Index
predictive of future performance is an unmanaged index consisting of all US
Treasury & Agency bonds weighted according
to market capitalization with
maturities between one and three years.

The PIA SHORT-TERM GOVERNMENT FUND again this year achieved its goal of
providing a high level of current income consistent with low volatility of
principal. The Fund returned 3.00% as compared to the unmanaged Lehman
Government 1-3 Year index return of 3.28%. As bond yields rose in 1999, the
manager's strategy of investing in short-term adjustable rate and floating rate
US government securities allowed the portfolio yield to increase, but these same
yield increases caused bond prices to decline. As a result the Fund's NAV
declined in 1999.

PIA TOTAL RETURN
BOND FUND

AVERAGE ANNUAL TOTAL RETURNS VALUE ON 11/30/99
- ---------------------------- -----------------
1 year (0.74%) PIA $10,189
Inception 1.51% Lehman Index $10,139

$10,000 Investment made 9/01/98 (Inception Date)

Past performance is not The Lehman Government 1-3 Year
predictive of future performance Index is an unmanaged index consisting
of all US Treasury & Agency bonds
weighted according to market
capitalization with maturities between
one and three years.

The PIA TOTAL RETURN BOND FUND lost 0.74% for this year versus the unmanaged
Lehman Gov/Corp index loss of 1.31%. The Fund benefitted from its holdings in
selected corporate, agency and mortgage-backed bonds as these securities out
performed US Treasury bonds for the year. However, bond yields rose over the
course of the year, which generated negative returns due to price declines but
also provided a greater portfolio yield for the Fund going forward.

-20-

<PAGE>

MONTEREY FUNDS
PERFORMANCE RESULTS - YEAR ENDED NOVEMBER 30, 1999

PIA GLOBAL BOND FUND

AVERAGE ANNUAL TOTAL RETURNS VALUE ON 11/30/99
- ---------------------------- -----------------
1 year (4.78%) PIA Global $10,932
Inception 3.40% Lehman Index $11,462

$10,000 Investment made 4/1/97 (Inception Date)

Past performance is not The Lehman Government Index is
predictive of future performance an unmanaged index consisting of all US
Treasury & Agency bonds weighted
according to market capitalization.

The PIA GLOBAL BOND FUND lost 4.78% this year versus the Lehman Government Index
loss of 1.38%. The Fund currently holds bonds denominated in the Euro, Canadian
and US dollar currencies. The Fund's allocation to Euro as well as the
underweight in the Japanese Yen detracted from returns as the Yen appreciated
versus the US dollar. At current Yen levels the Fund will maintain its current
underweighting which should benefit the Fund as we expect the currency to
depreciate to the 110 level which we intend to use as an entry point. We will
utilize any further weakness of the Euro to add to our allocation as the
economic expansion in Europe should drive the Euro to higher levels in the long
run.

See notes to financial statements.

-21-

<PAGE>

Monterey Mutual Funds
Distributed by:

Syndicated Capital, Inc.
1299 Ocean Avenue, Suite 210
Santa Monica, CA 90401

<PAGE>

MURPHY
NEW WORLD
FUNDS

-- Murphy New World Technology

-- Murphy New World Biotechnology

-- Murphy New World Technology
Convertibles

MONTEREY
MUTUAL
FUND

ANNUAL REPORT
NOVEMBER 30, 1999

<PAGE>

Dear Shareholder:

We had an outstanding year in fiscal 1999. The Technology Fund participated
fully in the sharp increase in prices of computer and electronics stocks. The
Biotechnology Fund outperformed most healthcare funds. The Convertibles Fund was
one of the best-performing convertible bond funds.

Looking forward, results in 2000 will be significantly affected by politics.
During an election year, the party in power tends to spend money and have a
cooperative Fed in their attempt to win re-election. A recession just isn(1)t in
the cards.

However, the economy probably will grow more slowly than last year. The Fed grew
the adjusted monetary base rapidly in the second half of 1999 in anticipation of
Y2K. They talked an anti-inflation line but their actions betrayed them. Now
they have to cut back, making monetary growth zero or negative.
In addition, the Fed seems determined to bring the stock market down, in part to
stop the wealth effect from pumping up consumer spending. The more investors
drive the market up, the harder the Fed will step on the brakes. However, they
don(1)t want a stock market crash in a Presidential election year, so we think
they will continue their gradualist policy, creating an economic headwind by
raising the Fed funds rate 1/4 point at a time until they see the market stall.
In this slowing environment, we expect GDP growth of about 3% for the year,
noticeably slower than in 1999. As the Fed raises short term interest rates,
Treasury bond rates probably won(1)t go much above 7%. Increasing short rates
means less risk of inflation, so the inflation premium can fall almost as fast
as the underlying real rate is rising. Ultimately that leads to a flattening
yield curve, where long rates are not much higher or even lower than short
rates. Historically, a flat yield curve is bad for stocks because it leads to an
economic slowdown - but that(1)s a worry for 2001, not 2000.

Interestingly, Europe should continue its gradual recovery even if the U.S.
slows. The new economy is hitting the Continent with a bang, which is struggling
free of heavy-handed Socialist policies that are completely impractical in a
wired world. Asia will grow even faster than Europe, completing its recovery
from the 1997 disaster. Japan will post its first decent growth year since 1989,
beginning a multiyear upswing. Latin America will grow, but not as much as Asia
due to their still-heavy reliance on old economy industries like mining.
All in all, it should be a solid growth year for technology companies, which
tend to export 20% to 80% of their products. There won(1)t be significant
economic weakness before 2001, if then. Technology earnings will do well because
personal computer sales are headed for another strong year due to rapid growth
in Europe and Asia, especially in the sub-$1,000 market. Most of them will be
connected to the Internet, which will be a big driver of the demand for computer
servers. In addition, Microsoft will introduce Windows 2000, the newest version
of the NT server operating system, on February 17th. This will drive server
sales throughout 2000.

By midyear, Intel will introduce the 64-bit Itanium microprocessor, also
destined for servers (at first). We think Windows 2000 on the Itanium processor
will be a very hot seller in the second half of 2000. The Windows/Itanium combo
will move onto the desktop PC in 2001 and be in cheap PCs in 2002.
In communications, there is no sign yet of a major slowdown in the growth of the
Internet. With traffic (3)bits and bytes(2) growing 1000% a year, the demand for
communications equipment and the component chips and parts will remain robust.
Voice and data have converged to the point that we don(1)t talk about telecom
and datacom anymore - it(1)s all just (3)coms(2). Any telephone company
upgrading its systems is as likely to buy from Cisco as from Tellabs.
With both computing and communications doing well, it is not surprising that the
semiconductor stocks also should have a good year. Their suppliers, the
semiconductor equipment companies, are facing the longest upturn we have ever
seen.

With dozens of new drugs completing the FDA clinical trial process, we expect an
explosion in drug approvals. Many more biotech companies will turn profitable by
the end of the year. We also see opportunities in medical devices and
Internet-related medical services and web sites. We look forward to managing
your mutual fund during fiscal 2000.

Very truly yours,

/s/MICHAEL MURPHY
- -----------------
Michael Murphy

<PAGE>

MONTEREY FUNDS
SCHEDULES OF INVESTMENTS - NOVEMBER 30, 1999

MURPHY NEW WORLD
TECHNOLOGY FUND
- --------------------------------------------------------------------------------
SHARES VALUE
- --------------------------------------------------------------------------------

COMMON STOCKS 93.59%
COMPUTERS 1.10%
500 Quintus Corp.* ..................................... $ 27,719
------------

ELECTRONIC COMPONENTS 3.72%
5,000 Genesis Microchip Inc.* ............................ 93,437
------------

FINANCIAL 26.32%
8,500 Knight/Trimark Group Inc., Class A* ................ 349,828
12,000 Telebanc Financial Corp.* .......................... 309,375
------------
659,203
------------

INTERNET SOFTWARE 24.98%
1,900 Critical Path, Inc.* ............................... 105,747
1,000 Digital Insight Corp.* ............................. 38,375
1,200 Interwoven, Inc.* .................................. 150,638
5,000 NetCreations Inc.* ................................. 142,813
3,000 Starmedia Network , Inc.* .......................... 88,969
600 eBay Inc.* ......................................... 99,019
------------
625,561
------------

NETWORKING PRODUCTS 14.28%
2,800 3Com Corp.* ........................................ 111,475
25,000 FVC.COM Inc.* ...................................... 246,094
------------
357,569
------------

SOFTWARE 13.86%
3,000 Pinnacle Systems Inc.* ............................. 98,812
100,000 Ross Systems Inc.* ................................. 248,437
------------
347,249
------------

TELECOMMUNICATIONS 9.33%
2,500 Global Crossing Ltd* ............................... 109,062
6,300 Osicom Technologies, Inc.* ......................... 124,622
------------
233,684
------------

TOTAL COMMON STOCKS
(cost $1,944,192) .................................. $ 2,344,422
------------

LONG OPTIONS .70%
10 S&P 100 Index Opt Put Dec\750.00
(cost $11,935) ................................ 17,625
------------

SHORT TERM INVESTMENTS 6.59%
MUTUAL FUNDS 4.99%
124,993 Firstar Treasury Fund
(cost $124,994) ............................... 124,994
------------

REPURCHASE AGREEMENTS 1.60%
$ 40,000 Firstar Bank Repurchase Agreement 3.35%,
due December 1, 1999,
collateralized by the following:
Conventional Loan Pool, 7.831%
due 03/01/25 ($251)
FHA/VA Pool, 7.00% due 11/15/07 ($4,624)
FHA/VA Pool, 7.00% due 07/15/08 ($7,520)
FHA/VA Pool, 7.50% due 09/15/08 ($4,413)
FHA/VA Pool, 7.00% due 09/15/08 ($7,674)
FHA/VA Pool, 7.00% due 11/15/10 ($8,947)
FHA/VA Pool, 7.00% due 10/15/11 ($7,365)
(cost $40,000) ................................ 40,000
------------

TOTAL SHORT TERM INVESTMENTS ................................. 164,994
------------

TOTAL INVESTMENTS
(cost $2,121,121) ............ 100.88% 2,527,041
LIABILITIES LESS OTHER ASSETS ............... (0.88%) (22,041)
------- ------------
TOTAL NET ASSETS ............................ 100.00% $ 2,505,000
======= ============

* Non income producing security

See notes to financial statements

-2-

<PAGE>

MONTEREY FUNDS
SCHEDULES OF INVESTMENTS - NOVEMBER 30, 1999

MURPHY NEW WORLD
BIOTECHNOLOGY FUND
- --------------------------------------------------------------------------------
SHARES VALUE
- --------------------------------------------------------------------------------

COMMON STOCKS 15.20%
BIOCHEMISTRY 0.14%
5,000 Trega Biosciences Inc.* ............................ $ 6,642
------------
BIOTECHNOLOGY 9.31%
5,000 Aastrom Biosciences Inc.* .......................... 5,234
8,000 Alteon Inc.* ....................................... 8,250
2,000 Aviron* ............................................ 32,063
5,000 Cell Genesys Inc.* ................................. 45,781
1,800 Corvas International Inc.* ......................... 4,838
5,000 Geron Corp.* ....................................... 53,594
1,000 Isis Pharmaceuticals Inc.* ......................... 15,656
2,000 Ligand Pharmaceuticals Inc. Class B*. .............. 22,938
50,000 Neurobiological Technology Inc.* ................... 167,187
1,000 Neurocrine Biosciences Inc.*. ...................... 13,094
3,000 Vical Inc.* ........................................ 65,062
------------
433,697
------------

PHARMACEUTICALS 5.29%
5,000 Angiotech Pharmaceuticals Inc.* .................... 39,882
10,000 Cortex Pharmaceuticals Inc.* ....................... 7,900
1,000 Eli Lilly & Co. .................................... 71,750
1,000 Gilead Sciences Inc.* .............................. 47,969
5,000 Geltex Pharmaceuticals Inc.* ....................... 52,969
3,000 NPS Pharmaceuticals Inc.* .......................... 17,906
10,000 Procyte Corp.* ..................................... 8,125
------------
246,501
------------

THERAPEUTICS 0.46%
1,000 Trimeris Inc.* ..................................... 21,280
------------

TOTAL COMMON STOCKS
(cost $721,588) .................................... 708,120
------------

LONG OPTIONS 0.43%
10 S&P 100 Index Opt Put Dec\750.00 ................... 17,625
5 S&P 100 Index Opt Put Dec\710.00 ................... 2,437
------------
20,062
------------

TOTAL LONG OPTIONS
(cost $13,870) ..................................... 20,062
------------

SHORT TERM INVESTMENTS 88.01%
U.S. GOVERNMENT SECURITIES 17.17%
$665,000 U.S. Treasury Bill 3.50%, 12/02/99+ ................ $ 664,935
135,000 U.S. Treasury Bill 3.50%, 12/02/99+ ................ 134,987
------------
(cost $799,922) 799,922
------------

MUTUAL FUNDS 4.97%
231,344 Firstar Treasury Fund
(cost $231,345) ............................... 231,345
------------

REPURCHASE AGREEMENTS 65.87%
$3,068,000 Firstar Bank Repurchase Agreement
3.35%, due December 1, 1999
collateralized by the following:
Conventional Loan Pool, 7.831%
due 03/01/25 ($19,276)
FHA/VA Pool, 7.00% due 11/15/07 ($354,631)
FHA/VA Pool, 7.00% due 07/15/08 ($576,814)
FHA/VA Pool, 7.50% due 09/15/08 ($338,501)
FHA/VA Pool, 7.00% due 09/15/08 ($588,628)
FHA/VA Pool, 7.00% due 11/15/10 ($686,250)
FHA/VA Pool, 7.00% due 10/15/11 ($564,919)
(cost $3,068,000) ............................. 3,068,000
------------

TOTAL SHORT TERM INVESTMENTS 4,099,267
------------
TOTAL INVESTMENTS
(cost $4,834,725) 103.64% 4,827,449
LIABILITIES LESS OTHER ASSETS (3.64%) (169,544)
------- ------------
TOTAL NET ASSETS 100.00% $ 4,657,905
======= ============

* Non income producing security
+ Securities held by broker as collateral on the common stock short sale

See notes to financial statements

-3-

<PAGE>

MONTEREY FUNDS
SCHEDULES OF INVESTMENTS - NOVEMBER 30, 1999

MURPHY NEW WORLD
BIOTECHNOLOGY FUND (CONTINUED)
- --------------------------------------------------------------------------------
SHARES VALUE
- --------------------------------------------------------------------------------

COMMON STOCKS SHORT SALES (14.53%)
BIOTECHNOLOGY (9.20%)
(1,000) Affymetrix Inc.* ................................... $ 97,562)
(2,000) Amgen Inc.* ........................................ (91,062)
(1,000) Human Genome Sciences Inc.* ........................ (111,969)
(1,000) Idec Pharmaceuticals Corp.* ........................ (126,625)
------------
(427,218)
------------
MEDICAL DEVICES (0.64%)
(1,000) Avigen Inc.* ....................................... (29,812)
------------

PHARMACEUTICALS (4.69%)
(1,000) Medimmune Inc.* .................................... (120,156)
(1,000) Millennium Pharaceuticals Inc.* .................... (97,344)
------------
(217,500)
------------
TOTAL COMMON STOCK SHORT SALES
(Proceeds $547,979) ................................ $ (674,530)
============

COMMON STOCKS 4.71%
Internet
7,000 FVC.COM Inc.* ...................................... $ 68,906
------------

TOTAL COMMON STOCKS
(cost $69,125) ..................................... 68,906
------------

CONVERTIBLE BONDS 30.28%
BIOTECHNOLOGY 24.34%
$426,000 Glycomed Inc.,7.50%, due 01/01/03 .................. 356,243
------------

COMPUTER PERIPHERALS 1.54%
55,000 Read Rite Corp., 6.50%, due 09/01/04 ............... 22,550
------------

SOFTWARE 1.27%
60,000 System Software Associates, 7.00%, due 09/15/02 .... 18,525
------------

SPECIALTY MATERIALS 3.13%
60,000 Hexcel Corp., 7.00%, due 08/01/11 .................. 45,900
------------

TOTAL CONVERTIBLE BONDS
(cost $566,006) .................................... 443,218
------------

LONG OPTIONS 1.20%
10 S&P 100 Index Opt Put Dec\750.00
(cost $11,935) ................................ 17,625
------------

* Non income producing security

See notes to financial statements

-4-

<PAGE>

MONTEREY FUNDS
SCHEDULES OF INVESTMENTS - NOVEMBER 30, 1999

MURPHY NEW WORLD
CONVERTIBLES FUND
- --------------------------------------------------------------------------------
SHARES/PRINCIPAL VALUE VALUE
- --------------------------------------------------------------------------------
SHORT TERM INVESTMENTS 8.84%
MUTUAL FUNDS 4.68%
68,456 Firstar Treasury Fund
(cost $68,457) ................................ $ 68,457
------------

REPURCHASE AGREEMENTS 4.16%
$ 61,000 Firstar Bank Repurchase Agreement 3.35%,
due December 1, 1999
collateralized by the following:
Conventional Loan Pool, 7.831% due 03/01/25 ($383)
FHA/VA Pool, 7.00% due 11/15/07 ($7,051)
FHA/VA Pool, 7.00% due 07/15/08 ($11,469)
FHA/VA Pool, 7.50% due 09/15/08 ($6,730)
FHA/VA Pool, 7.00% due 09/15/08 ($11,703)
FHA/VA Pool, 7.00% due 11/15/10 ($13,644)
FHA/VA Pool, 7.00% due 10/15/11 ($11,232)
(cost $61,000) ................................ 61,000
------------

TOTAL SHORT TERM INVESTMENTS
(cost $129,457) ............................... 129,457
------------

TOTAL INVESTMENTS
(cost $776,523) ................. 45.03% 659,206
Other assets less liabilities ............. 54.97% 804,650
------- ------------
TOTAL NET ASSETS .......................... 100.00% $ 1,463,856
======= ============
* Non income producing security

See notes to financial statements

-5-

<PAGE>

MONTEREY FUNDS
STATEMENTS OF ASSETS AND LIABILITIES - NOVEMBER 30, 1999

Murphy
Murphy Murphy New World
New World New World Technology
Technology Biotechnology Convertibles
--------------------------------------------
Assets
Investments in securities, at value
<S> <C> <C> <C>
(Cost $2,121,121, $1,766,725, and $776,523, respectively) $ 2,527,041 $ 1,759,449 $ 659,206
Repurchase agreements, at value (cost 3,068,000) ........ 0 3,068,000 0
Receivable for securities sold .......................... 0 158,217 797,544
Receivable for fund shares sold ......................... 2,750 12,216 10,000
Income receivable ....................................... 489 1,359 17,135
Due from investment adviser (Note 3) ................... 5,835 0 5,238
Due from broker ......................................... 385 373,040 2,101
Prepaid expenses and other .............................. 7,972 2,759 2,982
----------- ----------- -----------
Total assets .................................... 2,544,472 5,375,040 1,494,206
----------- ----------- -----------

Liabilities
Securities sold short, at value (proceeds $547,979) ..... 0 674,530 0
Payable for securities purchased ........................ 11,935 13,870 11,935
Payable for securities redeemed ......................... 15,825 14,714 0
Due to investment adviser (Note 3) ..................... 0 63 0
Accrued expenses and other .............................. 11,712 13,958 18,416
----------- ----------- -----------
Total liabilities ............................... 39,472 717,135 30,351
----------- ----------- -----------

Net Assets
Shares of beneficial interest, no par value;
unlimited shares authorized ..................... 2,060,816 4,670,501 1,650,675
Undistributed net investment income (loss) .............. 0 999 52,659
Accumulated net realized gain
(loss)on investments ............................ 38,264 120,233
Net unrealized appreciation (depreciation)
on investments .................................. 405,920 (133,828) (117,317)
----------- ----------- -----------
Net assets ...................................... $ 2,505,000 $ 4,657,905 $ 1,463,855
=========== =========== ===========

Net asset value, offering and redemption price per share $ 21.17 $ 7.60 $ 28.86
----------- ----------- -----------
Shares outstanding ...................................... 118,355 612,837 50,724
=========== =========== ===========

</TABLE>

See notes to financial statements

-6-
<PAGE>

MONTEREY FUNDS
STATEMENTS OF OPERATIONS - FOR THE YEAR ENDED NOVEMBER 30, 1999

<TABLE>
<CAPTION>
Murphy
Murphy Murphy New World
New World New World Technology
Technology Biotechnology Convertibles
------------------------------------------
INVESTMENT INCOME
<S> <C> <C> <C>
Interest ........................................ $ 330 $ 83,406 $ 72,428
Dividends ....................................... 9,196 1,281 7,325
Other Income .................................... 436 0 95
--------- --------- ---------
Total investment income ................. 9,962 84,687 79,848
--------- --------- ---------

EXPENSES
Adviser fees (Note 3) ........................... 14,913 42,054 8,417
Distribution fees (Note 4) ...................... 3,717 10,428 3,314
Transfer agent fees ............................. 16,881 19,290 17,907
Administrative fees (Note 3) .................... 16,028 18,167 17,679
Custodian fees .................................. 3,625 4,774 3,233
Audit fees ...................................... 7,155 7,155 7,145
Legal fees ...................................... 5,706 5,382 5,532
Registration fees ............................... 17,262 22,115 21,149
Trustees' fees .................................. 1,263 1,263 1,263
Printing expense ................................ 1,926 3,770 3,358
Postage expense ................................. 928 1,557 1,275
Other expenses .................................. 1,611 1,431 2,035
--------- --------- ---------
Total expenses .......................... 91,015 137,386 92,307
Less: Expense reimbursement from adviser (Note 3) (61,340) (53,698) (65,719)
--------- --------- ---------
Net expenses ............................ 29,675 83,688 26,588
--------- --------- ---------
Net investment income (loss) ............ (19,713) 999 53,260
--------- --------- ---------

REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS
Net realized gain on investments ................ 115,284 345,002 248,844
Net unrealized appreciation on investments ...... 847,028 363,720 72,890
--------- --------- ---------
Net gain on investments ......................... 962,312 708,722 321,734
--------- --------- ---------
Net increase in net assets
resulting from operations ............... $ 942,599 $ 709,721 $ 374,994
========= ========= =========

</TABLE>

See notes to financial statements

-7-

<PAGE>

MONTEREY FUNDS
STATEMENTS OF CHANGES IN NET ASSETS

Murphy Murphy
New World New World
Technology Biotechnology
------------------------------------------------------------
Year ended Year ended Year ended Year ended
Nov. 30, Nov. 30, Nov. 30, Nov. 30,
1999 1998 1999 1998
------------------------------------------------------------
Operations
<S> <C> <C> <C> <C>
Net investment income (loss) ............. $ (19,713) $ (26,953) $ 999 $ (72,811)
Net realized gain (loss) on investments .. 115,284 345,002 248,844
Net unrealized appreciation (depreciation)
on investments ................... 847,028 363,720 72,890 (167,308)
Net increase (decrease) in net assets
resulting from operations ........ 942,599 709,721 374,994

Dividends Paid to Shareholders
Dividends from net investment income ..... 0 0 0 0
Distributions from net realized gain ..... 0 (190,274) 0 0
0 (190,274) 0 0

Fund Share Transactions
Net proceeds from shares sold ............ 2,777,662 690,415 1,082,198 2,949,993
Dividends reinvested ..................... 0 171,796 0 0
Payment for shares redeemed .............. (2,230,800) (682,131) (1,092,448) (558,088)
Net increase (decrease) in net assets
from fund share transactions ..... 546,862 180,080 2,391,905 22,426
Net increase (decrease) in net assets .... 1,489,461 (423,483) 699,471 1,605,445
NET ASSETS, Beginning of Year ............ 1,015,539 1,439,022 3,958,434 2,352,989
NET ASSETS, End of Year .................. $ 2,505,000 $ 1,015,539 $ 4,657,905 $ 3,958,434

Changes in Shares Outstanding
Shares sold .............................. 172,509 50,527 156,398 406,645
Shares issued on reinvestment
of dividends ..................... 0 12,431 0 0
Shares redeemed .......................... (141,404) (50,720) (162,600) (79,194)
Net increase (decrease) in
shares outstanding ............... 31,105 12,238 (6,202) 327,451

Murphy
New World
Technology
Convertibles
-----------------------------
Year ended Year ended
Nov. 30, Nov. 30,
1999 1998
-----------------------------
Operations
Net investment income (loss) ............. $ 53,260 $ 60,628
Net realized gain (loss) on investments ..
Net unrealized appreciation (depreciation)
on investments ...................
Net increase (decrease) in net assets
resulting from operations ........

Dividends Paid to Shareholders
Dividends from net investment income ..... (56,712) (16,073)
Distributions from net realized gain ..... 0 0
(56,712) (16,073)

Fund Share Transactions
Net proceeds from shares sold ............ 2,397,905 46,848
Dividends reinvested ..................... 52,619 15,073
Payment for shares redeemed .............. (2,428,098) (146,704)
Net increase (decrease) in net assets
from fund share transactions ..... (84,783)
Net increase (decrease) in net assets .... 340,708
NET ASSETS, Beginning of Year ............ 1,123,147 1,434,596
NET ASSETS, End of Year .................. $ 1,463,855 $ 1,123,147

Changes in Shares Outstanding
Shares sold .............................. 96,131 1,830
Shares issued on reinvestment
of dividends ..................... 2,452 581
Shares redeemed .......................... (98,588) (5,786)
Net increase (decrease) in
shares outstanding ............... (5) (3,375)

</TABLE>

See notes to financial statements

-8-

<PAGE>

MONTEREY FUNDS
NOTES TO FINANCIAL STATEMENTS - NOVEMBER 30, 1999

NOTE 1. ORGANIZATION
Monterey Mutual Fund (the "Trust"), formerly Monitrend Mutual Fund, is
registered under the Investment Company Act of 1940, as amended, as a
diversified, open-end management investment company. The Trust was organized as
a Massachusetts business trust on January 6, 1984 and consists of nine series of
shares: the PIA Short Term Government Securities Fund, the Camborne Government
Income Fund, the OCM Gold Fund, the PIA Equity Fund, the Murphy New World
Biotechnology Fund, the Murphy New World Technology Fund, the Murphy New World
Technology Convertibles Fund, the PIA Global Bond Fund and the PIA Total Return
Bond Fund (collectively the "Funds"), each of which has separate assets and
liabilities and differing investment objectives. The investment objective for
each of the Funds presented herein are: the Murphy New World Technology Fund,
(the "Technology Fund"), long-term growth of capital through investing primarily
in equity securities of companies that its investment adviser believes can
produce products or services that provide or benefit from advances in
technology; the Murphy New World Technology Biotechnology Fund, ("Biotechnology
Fund"), long-term growth of capital through investing primarily in equity
securities of companies that its investment adviser believes can produce
products or services that provide or benefit from advances in biotechnology; the
Murphy New World Technology Convertibles Fund, ("Convertibles Fund"), to
maximize total return through a combination of capital appreciation and income.

NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed
by the Funds in the preparation of their financial statements.

If a written call option is exercised, a capital gain or loss is
realized from the sale of the underlying security and the proceeds from such
sale are increased by the premium originally received.

FUTURES CONTRACTS - The Technology Fund, the Biotechnology Fund and the
Convertibles Fund may from time to time enter into futures contracts as a hedge
to provide protection against adverse movements in the prices of securities in
the portfolio. When a Fund enters a futures contract, it is required to pledge
to the clearing broker an amount of cash and/or securities equal to
approximately 5% of the contract amount. This amount is known as the "initial
margin". Pursuant to the futures contract, the Fund agrees to take or make
delivery of an amount of cash equal to a specified dollar amount times the
difference between the value at the close of the day and the price at which the
futures contract was originally struck. Such payments, known as the "variation
margin", are recorded by the Fund as unrealized gains or losses. When the
futures contract expires or is closed by the Fund, it realizes a gain or loss.

Financial Instruments with Off Balance Sheet Risk - Futures contracts
involve elements of market risk and credit risk in excess of the amounts
reflected in the Statement of Assets and Liabilities. The contract amounts of
these futures contracts reflect the extent of exposure to off balance sheet
risk.

-9-

<PAGE>

MONTEREY FUNDS
NOTES TO FINANCIAL STATEMENTS - NOVEMBER 30, 1999 (CONTINUED)

Futures contracts are purchased only on exchanges. The exchange acts as
the counterparty to the Trust's futures transactions; therefore the Trust's
credit risk is limited to failure of the exchange.

Subsequent market fluctuations of securities sold short may require a
Trust to purchase securities at prices which exceed the value reflected on the
Statement of Assets and Liabilities.

FEDERAL INCOME TAXES - It is each Fund's policy to meet the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable net income to its shareholders.

Therefore the Funds paid no Federal Income taxes and no Federal income
tax provision was required. At November 30, 1999, the Convertibles Fund had a
capital loss carryfoward of approximately $122,000, which expire in varying
amounts through 2002, 2005, 2006.

NOTE 3. INVESTMENT ADVISORY AND ADMINISTRATION AGREEMENTS
The Technology Fund and Biotechnology Fund each has an investment
advisory agreement with Murphy Investment Management, Inc. ("Murphy"), whereby
each Fund pays Murphy a fee, computed daily and payable monthly, at the annual
rate of 1.00% of their respective net assets.

The Convertibles Fund also has an investment advisory agreement with
Murphy. The Convertibles Fund pays Murphy a fee computed daily and payable
monthly, at the following annual rate based upon daily net assets:

ASSETS FEE RATE
------ --------
0 to $150 million ........................... 0.625%
$150 million to $250 million ................ 0.500%
Over $250 million ........................... 0.375%

For the year ended November 30, 1999 Murphy agreed to reimburse the
Funds for expenses in excess of 1.99% of average net assets.

The Trust has a fund accounting and administrative agreement with
American Data Services, Inc. ("ADS"). ADS receives a fee, computed daily and
payable monthly, at an annual rate of 0.1% of average daily net assets, subject
to a monthly minimum.

NOTE 4. DISTRIBUTION AGREEMENT AND PLAN
Syndicated Capital, Inc. serves as the Distributor of each Fund's
shares. The President and sole shareholder of the Distributor is also a trustee
of the Trust.

NOTE 5. PURCHASES AND SALES OF SECURITIES
The cost of purchases and sales of investment securities (other than
short-term investments) for the year ended November 30, 1999, were as follows:

-10-

<PAGE>

MONTEREY FUNDS
NOTES TO FINANCIAL STATEMENTS - NOVEMBER 30, 1999 (CONTINUED)

PURCHASES SALES
--------- -----
Technology Fund $ 5,382,636 $ 4,810,298
Biotechnology Fund 5,110,891 6,755,667
Convertibles Fund 1,484,829 2,384,955

The cost of securities for income tax purposes is the same as that shown in the
schedules of investments.

Unrealized appreciation and depreciation on investments at November 30, 1999
based on cost for Federal income taxes, are as follows:

UNREALIZED UNREALIZED
APPRECIATION DEPRECIATION NET
------------ ------------ ---
Technology Fund $ 405,920 $( 0) $ 405,920
Biotechnology Fund 119,827 (253,653) (133,828)
Convertibles Fund 5,690 (123,007) (117,317)

-11-

<PAGE>

MONTEREY FUNDS
MURPHY NEW WORLD TECHNOLOGY
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)

Year ended Year ended Year ended Year ended Year ended
Nov. 30, Nov. 30, Nov. 30, Nov. 30, Nov. 30,
1999 1998 1997++ 1996* 1995*
-------------------------------------------------------------------

<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ... $ 11.64 $ 19.18 $ 20.51 $ 17.81 $ 14.35

Income From Investment Operations
Net investment (loss) .................. (0.17) (0.31) (0.33) (0.40) (0.32)
Net realized and unrealized gain (loss)
on investments ......................... 9.70 (4.77) (0.40) 4.86 4.19
Total from investment operations ....... 9.53 (5.08) (0.73) 4.46 3.87

Less Distributions
Dividends from net investment income ... 0.00 0.00 0.00 0.00 0.00
Distributions from net realized gains .. 0.00 (2.46) (0.60) (1.76) (0.41)
Total distributions .................... 0.00 (2.46) (0.60) (1.76) (0.41)
Net asset value, end of period ......... $ 21.17 $ 11.64 $ 19.18 $ 20.51 $ 17.81
Total return ........................... 81.87% (28.51%) (3.69%) 26.32% 26.95%

Ratios/Supplemental Data
Net assets, end of period (in 000's) ... 2,505 1,016 1,439 886 281
Ratio of expenses to average net assets 1.99% 2.44% 2.44% 2.34% 2.44%
Ratio of expenses to average net assets,
before reimbursement ................... 6.10% 7.14% 8.13% 10.44% 18.74%
Ratio of net investment income (loss) to
average net assets ..................... (1.32%) (2.20%) (1.96%) 2.06% 1.97%
Portfolio turnover rate ................ 434.84% 142.89% 57.01% 17.33% 40.77%

<FN>

* Based on average shares outstanding.
++ On 12/13/96 Murphy Investment Management became the Fund's investment
adviser. Prior to 12/13/96, Monitrend Investment Management Inc. was the
Fund's investment adviser.
</FN>
</TABLE>

-12-

<PAGE>

MONTEREY FUNDS
MURPHY NEW WORLD BIOTECHNOLOGY
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)

Year ended Year ended Year ended Year ended Year ended
Nov. 30, Nov. 30, Nov. 30, Nov. 30, Nov. 30,
1999 1998 1997++ 1996* 1995*
-------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ... $ 6.39 $ 8.07 $ 7.19 $ 6.74 $ 6.12

Income From Investment Operations
Net investment (loss) .................. 0.00 (0.15) (0.16) (0.17) (0.15)
Net realized and unrealized gain (loss)
on investments ......................... 1.21 (1.53) 1.04 0.62 0.77
Total from investment operations ....... 1.21 (1.68) 0.88 0.45 0.62

Less Distributions
Total distributions .................... 0.00 0.00 0.00 0.00 0.00
Net asset value, end of period ......... $ 7.60 $ 6.39 $ 8.07 $ 7.19 $ 6.74
Total return ........................... 18.94% (20.82%) 12.24% 6.67% 10.13%

Ratios/Supplemental Data
Net assets, end of period (in 000's) ... 4,658 3,958 2,353 231 400
Ratio of expenses to average net assets 1.99% 2.44% 2.47% 2.65% 2.89%
Ratio of expenses to average net assets,
before reimbursement ................... 3.27% 3.79% 8.58% 15.28% 9.96%
Ratio of net investment income (loss) to
average net assets ..................... 0.02% (2.11%) (1.98%) (2.31%) (2.18%)
Portfolio turnover rate ................ 313.79% 458.56% 15.09% 2.79% 36.89%

<FN>

* Based on average shares outstanding.
++ On 12/20/96 Murphy Investment Management became the Fund's investment
adviser. Prior to 12/20/96, Monitrend Investment Management Inc. was the
Fund's investment adviser
</FN>
</TABLE>

-13-

<PAGE>

MONTEREY FUNDS
MURPHY NEW WORLD TECHNOLOGY CONVERTIBLES
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)

Year ended Year ended Year ended Year ended Year ended
Nov. 30, Nov. 30, Nov. 30, Nov. 30, Nov. 30,
1999 1998 1997++ 1996 1995
--------------------------------------------------------------------------

<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period .. $ 22.14 $ 26.52 $ 26.64 $ 21.42 $ 16.67

Income From Investment Operations
Net investment income ................. 1.05 1.19 0.21 0.01 0.02
Net realized and unrealized gain (loss)
on investments ........................ 6.79 (5.27) (0.33) 5.23 4.82
Total from investment operations ...... 7.84 (4.08) (0.12) 5.24 4.84

Less Distributions
Dividends from net investment income .. (1.12) (0.30) 0.00 (0.02) (0.09)
Total distributions ................... (1.12) (0.30) 0.00 (0.02) (0.09)
Net asset value, end of period ........ $ 28.86 $ 22.14 $ 26.52 $ 26.66 $ 21.51
Total return .......................... 37.16% (15.55%) (0.45%) 24.49% 29.19%

Ratios/Supplemental Data
Net assets, end of period (in 000's) .. 1,464 1,123 1,435 1,560 1,377
Ratio of expenses to average net assets 1.99% 2.44% 2.44% 2.26% 2.44%
Ratio of expenses to average net
assets, before reimbursement .......... 6.91% 6.94% 6.83% 5.11% 6.08%
Ratio of net investment income to
average net assets .................... 3.99% 4.64% 0.76% 0.04% 0.10%
Portfolio turnover rate ............... 156.08% 28.90% 85.91% 80.93% 151.86%

<FN>

++ On 12/13/96 Murphy Investment Management became the Fund's investment
adviser. From 2/1/95 to 12/31/96 MidCap Associates, Inc. was the Fund's
investment adviser. Prior to 2/1/95, Monitrend Investment Management Inc.
was the Fund's investment adviser.
</FN>
</TABLE>

-14-

<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Trustees and Shareholders of
Monterey Mutual Fund

In our opinion, the accompanying statements of assets and liabilities, including
the schedules of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of The Murphy New World Technology
Fund, the Murphy New World Biotechnology Fund and the Murphy New World
Technology Convertibles Fund series of Monterey Mutual Fund, (hereafter referred
to as the "Trust") at November 30, 1999, and the results of each of their
operations, the changes in each of their net assets and the financial highlights
for the year then ended, in conformity with generally accepted accounting
principles. These financial statements and financial highlights (hereafter
referred to as "financial statements") are the responsibility of the Trust's
management; our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit of these financial
statements in accordance with generally accepted auditing standards, which
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, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audit, which included
confirmation of securities at November 30, 1999 by correspondence with the
custodian and brokers, provides a reasonable basis for the opinion expressed
above. The financial statements for the year ended November 30, 1998 including
the financial highlights for each of the four years in the period then ended,
were audited by other independent accountants whose report dated January 8, 1999
expressed an unqualified opinion on those financial statements.

PricewaterhouseCoopers LLP
New York, New York
December 17, 1999

-15-

<PAGE>

CHANGE IN INDEPENDENT ACCOUNTANT

On September 9, 1999, the Trust, with the approval of its Board of
Trustees and its Audit Committee, engaged PwC as its independent auditors.

-16-

<PAGE>

MONTEREY FUNDS
PERFORMANCE RESULTS - YEAR ENDED NOVEMBER 30, 1999

MURPHY NEW WORLD
TECHNOLOGY FUND

AVERAGE ANNUAL TOTAL RETURNS VALUE ON 11/30/99
- ---------------------------- -----------------
1 year 81.87% Technology $19,331
5 years 14.96% S&P 500 $33,641
Inception 11.38%

$10,000 Investment made 10/20/93 (Inception Date)

Past performance is not The S&P 500 Index is a broad
predictive of future performance unmanaged index generally
considered to be representative of
the US equity market.

THE MURPHY NEW WORLD TECHNOLOGY FUND increased 81.87% in fiscal 1999, powered by
strong returns in the computer and electronics sectors of the stock market. The
complete story of 1999 is not just how well technology did but also how poorly
many other sectors did. The New Economy we have been talking about for many
years has grown large enough to affect the old economy. Technology accounts for
nearly 20% of the U.S. economy and 30% of the Standard & Poor's 500 Index. The
Internet enables substantial reductions in direct manufacturing costs and
selling, general and administrative expenses. Cost reductions improve the
standard of living and drive increased growth rates. We think this
once-in-a-lifetime economic shift will continue to play out in 2000.

At the same time, valuation excesses in Internet and some communications stocks
suggest 2000 will be more volatile than the usual fourth year of a Presidential
cycle. We analyze and buy what we call "TARP". Technology At a Reasonable Price.
Being price-sensitive at the time of purchase reduces risk and ultimately
improves our rate of return. The shift to a New Economy will continue for at
least another five to ten years. We believe our strategy allows all of us to
participate with a reasonable level of risk. We look forward to another good
year in fiscal 2000. We continue to subsidize the expense ratio of the fund to
hold it below 2%.

-17-

<PAGE>

MONTEREY FUNDS
PERFORMANCE RESULTS - YEAR ENDED NOVEMBER 30, 1999

MURPHY NEW WORLD
BIOTECHNOLOGY FUND

AVERAGE ANNUAL TOTAL RETURNS VALUE ON 11/30/99
- ---------------------------- -----------------
1 year 18.94% Biotech $10,780
Inception 2.58% S&P 500 $19,599

$10,000 Investment made 12/20/96 (date Murphy became investment adviser)

Past performance is not The S&P 500 Index is a broad unmanaged
predictive of future performance index generally considered to be
representative of the US equity market.

THE MURPHY NEW WORLD BIOTECHNOLOGY FUND increased 18.94% in fiscal 1999, beating
the S&P 500 and most healthcare funds. The biotech sector finally came alive in
the second half of 1999 and was able to close above its 1992 high for the first
time in seven years. Part of this good performance came from accelerating
biotech drug approvals. Although many biotech drugs and companies failed during
the seven year bear market, those that survived the arduous FDA approval process
are getting approvals and introducing drugs. Several will turn profitable in
2000.

Part of the good industry stock performance came from a level of attention
to these stocks by institutional investors that we have not seen for several
years. Biotech stock conferences have been crowded by investors looking for the
next hot sector. Many of these large investors had little or no biotech in their
portfolios at the beginning of 1999. Even a modest 3% to 5% exposure would equal
a significant amount of money flowing into the biotech sector.

We spend a lot of time visiting companies and attending scientific and brokerage
firm meetings to keep up with the technology, which is the key issue to making
money in this area. We think the human genome will be completely mapped before
the end of the fiscal year, which will open numerous new paths to effective
drugs.

Biotech is just at the beginning of its stock market cycle, similar to where
personal computing was in 1985. We look forward to a strong year in fiscal 1999.
We continue to subsidize the expense ratio of the Fund to hold it below 2%.

-18-

<PAGE>

MONTEREY FUNDS
PERFORMANCE RESULTS - YEAR ENDED NOVEMBER 30, 1999

MURPHY NEW WORLD
TECHNOLOGY CONVERTIBLES FUND

AVERAGE ANNUAL TOTAL RETURNS VALUE ON 11/30/99
- ---------------------------- -----------------
1 year 37.16% Tech Convertibles $11,711
Inception 5.57% S&P 500 $19,599

$10,000 Investment made 1/1/97 (date Murphy became investment adviser)

Past performance is not The S&P 500 Index is a broad
predictive of future performance unmanaged index generally considered
to be representative of the US equity
market.

THE MURPHY NEW WORLD TECHNOLOGY CONVERTIBLES FUND increased 37.16% in fiscal
1999, including a $1.05 per share income payout, similar to the $1.12 payout in
fiscal 1998. Although some major mutual fund performance measurement
organizations classify this as a technology fund, it clearly is a convertible
securities fund with an income component and a growth component.

Convertible bond funds are appropriate for those who seek current income as well
as growth of principal. We believe participating in the equity appreciation of a
diversified of technology companies should produce attractive returns over the
years.

Some of our return in fiscal 1999 came from buying convertible public offerings,
a strategy we intend to continue in 2000. Companies that issue convertible bonds
often come from either the newest sectors such as the Internet and
biotechnology, where the need for capital drives the company to explore all
available avenues, or from older sectors where depressed equity prices push
issuers towards convertible debt. In that case the depressed stock can take some
of the risk out of equity investing. We continue to subsidize the expense ratio
of the fund to hold it below 2%.

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Monterey Mutual Funds
Distributed by:

Syndicated Capital, Inc.
1299 Ocean Avenue, Suite 210
Santa Monica, CA 90401