<PAGE>
SEMI-ANNUAL
REPORT
[LOGO]
RSI RETIREMENT TRUST
CORE EQUITY FUND
VALUE EQUITY FUND
EMERGING GROWTH EQUITY FUND
INTERNATIONAL EQUITY FUND
ACTIVELY MANAGED BOND FUND
INTERMEDIATE-TERM BOND FUND
SHORT-TERM INVESTMENT FUND
DEDICATED BOND FUND
1997
BROKER/DEALER
[LOGO]
RETIREMENT SYSTEM
Distributors Inc.
P.O. Box 2064
Grand Central Station
New York, NY 10163-2064
<PAGE>
TABLE OF CONTENTS
- ------------------------------------------------------
<TABLE>
<S> <C>
President's Message...................................................... 1
Investment Review........................................................ 2
Financial Statements of Investment Funds................................. 9
Core Equity Fund..................................................... 11
Value Equity Fund.................................................... 15
Emerging Growth Equity Fund.......................................... 19
International Equity Fund............................................ 25
Actively Managed Bond Fund........................................... 30
Intermediate-Term Bond Fund.......................................... 36
Short-Term Investment Fund........................................... 41
Notes to Financial Statements............................................ 44
Officers, Consultants, Investment Managers,
Custodians, Distributor, Transfer Agent................................ 63
Board of Trustees........................................................ 64
</TABLE>
[LOGO]
is a registered trademark of Retirement System Group Inc.
This Semi-Annual Report is unaudited.
<PAGE>
PRESIDENT'S MESSAGE
To Our Unitholders:
During the six-month period ended March 31, 1997, the trend
that has been prevalent during the past few years--moderate
economic growth, fluctuating interest rates, favorable
inflation rates, heavy corporate stock repurchases and massive
cash inflows by mutual fund investors--continued unabated.
Equity markets showed ongoing strength, with strong returns
in the first quarter of the fiscal year, followed by more
volatile results in the second quarter. The S&P 500, for
example, a representative index of the U.S. broad equity
market, rose 11.24% for the entire period (8.42% and 2.61%,
respectively, for the last two quarters). Second quarter
volatility was also apparent in the Russell 2000, a small cap
index, which ended the six-month period down 0.24%, and down
5.17% for the three months ended March 31, 1997. Fixed-income
markets, affected by the continuing strong economic growth and
concerns about higher inflation and the resulting upward
movement in interest rates, experienced negative returns in the
second quarter of the fiscal year, but still finished the six
months ended March 31, 1997 with positive results.
The Trust's funds performed respectably during this period,
with three funds outperforming their respective Lipper
benchmarks. In fact, the Value Equity Fund outpaced its
performance benchmark by more than four percentage points.
On behalf of the Board of Trustees, I'd like to thank our
unitholders for choosing RSI Retirement Trust to help meet your
retirement savings goals.
Sincerely,
[SIG]
William Dannecker
President and Trustee
1
<PAGE>
INVESTMENT REVIEW
EQUITY FUNDS
For the first six months of fiscal year 1997, the domestic
equity market indices (principally for large cap stocks) showed
substantial strength in the fourth quarter 1996 and modest
strength for the first quarter 1997. For the full period, the
Dow Jones Industrial Average (DJIA) reflected the highest gains
at 13.17%. During this period, cyclical stocks were generally
in favor and the DJIA benefited accordingly, since this index
contains a number of cyclical stocks. The S&P 500, a
representative index of the U.S. broad equity market, rose
11.24% for the period (8.42% and 2.61%, respectively, for the
last two quarters).
Large cap growth stocks, as measured by the Russell 1000
Growth Index, were more sensitive to investor sentiment, which
became more bearish in the first quarter of 1997, and returned
6.61% (6.04% of the return coming in the fourth quarter 1996).
The Russell 2000, a small capitalization index, was one of the
worst performing indices at -0.24% for the last six months, and
down 5.17% for the trailing three months ended March 31, 1997.
(For the six-month period, the Russell 2000 Growth Index,
however, was down 10.25%, and reflected a -10.49% result for
the most recent quarter.)
Value-oriented stocks (traditionally, stocks selling at low
p/e's, low price/book ratios and/or high dividend yields)
performed well over the past six months. The representative
index for this investment discipline, the Russell 1000 Value
Index, returned 12.79% (9.98% for the fourth quarter 1996 and
2.56% for the first quarter 1997). Non-U.S. stock markets, as
measured by the MSCI EAFE Index, reflected positive returns for
the first quarter of fiscal year 1997 and negative results for
the second quarter, finishing the half-year period at
break-even.
Moderate economic growth, low inflation rates, favorable
interest rates, heavy corporate stock repurchases and
substantial cash inflow by mutual fund investors have propelled
the stock market over the past few years. Thus far in fiscal
year 1997, this trend has continued (as was the case for the
first half year of fiscal year 1996). Corporate earnings have
benefited from productivity gains from technological
innovations, downsizing of costs, and the improved competitive
position of U.S. companies, in spite of a rising dollar.
Economic growth (Gross Domestic Product, or "GDP") was
strong, growing at an annualized rate of 3.8% for the fourth
quarter 1996. The momentum continued for the first quarter of
1997.
Assuming a 2% to 3% GDP pace, on average, the key to future
earnings growth will be the interaction of productivity gains
and product price increases versus higher wage and raw material
costs. The extent of recovery in foreign economies will also
play a major role. Looking to the future, meaningful stock
market gains would seem to depend upon no substantial increases
in interest rates and the continuation of earnings growth
momentum. Also, ongoing share repurchases should continue to
help stock prices. Conversely, market volatility risk could
increase if higher interest rates accompanied by profit
pressures develop, particularly
2
<PAGE>
if strong cash flow trends into equity mutual funds moderate
significantly. Subsequent to March 31, 1997, interest rates
have continued to fluctuate and the equity markets have been
very volatile as a result, with the small capitalization
company indices being the most affected to date.
For the six months ended March 31, 1997, the Trust's large
cap equity funds (Core and Value) turned in respectable
performance results, followed by the International Equity Fund.
The Emerging Growth Equity Fund was hit hardest, as small cap
growth stocks faltered, and finished down 8.60%.
CORE EQUITY FUND
The Core Equity Fund posted a 7.09% return for the six months
ended March 31, 1997, compared to the 8.63% return of the
Lipper Growth and Income Funds Average, its performance
benchmark. For the one-year period ended March 31, 1997, the
Core Fund returned 18.37%, almost three percentage points
higher than the 15.47% return of its Lipper benchmark. For the
three years ended March 31, 1997, Core returned 21.32% per year
versus the 17.89% annualized return of its benchmark. This
return placed Core in the top 10% (33rd out of 341 funds) of
its Lipper grouping. For the five years ended March 31, 1997,
Core achieved a 16.20% annualized return, compared to the
14.21% annualized return of its benchmark, giving it a top 18%
ranking (38th out of 212 funds) in its Lipper grouping. Over
the longer term (since inception, 14 1/4 years ended March 31,
1997), the Core Fund achieved a 15.98% annualized return,
compared to the 14.33% return of the Lipper Growth and Income
Funds Average. This annualized return ranked the Core Equity
Fund in the top 15% of the Lipper Growth and Income Funds
grouping (12th out of 85 funds).
These long-term results for the Core Equity Fund have been
achieved while taking less risk (as measured by standard
deviation) than the overall market, as represented by the S&P
500. The standard deviation of return for the Fund was 13.12
versus 13.69 for the index over this 14 1/4-year period.
VALUE EQUITY FUND
The Value Equity Fund posted a 12.83% return for the fiscal
year-to-date, ended March 31, 1997, outperforming the 8.63%
return of its performance benchmark, the Lipper Growth & Income
Funds Average, by more than four percentage points. For the
one-year period ended March 31, 1997, the Value Equity returned
21.50%, again outperforming the Lipper benchmark's return of
15.47% by a substantial margin, and ranked in the top 6% of its
Lipper grouping (28th out of 540 funds). For the three years
ended March 31, 1997, the Fund's annualized return of 20.66%
placed it in the top 15% of its Lipper grouping (50th out of
341 funds). For the five years ended March 31, 1997, the Value
Equity recorded an annualized return of 14.66%, compared to the
14.21% annualized return of its benchmark. For the longer time
periods, this Fund underperformed versus its Lipper benchmark.
3
<PAGE>
EMERGING GROWTH EQUITY FUND
The Emerging Growth Equity Fund returned -8.60% for the six
months ended March 31, 1997, while its benchmark, the Lipper
Small Company Growth Funds Average, returned -4.60%. For the
one-year period, the Fund posted a 5.16% return, slightly
higher than the 4.67% return of its Lipper benchmark. For the
three-year period ended March 31, 1997, this Fund returned
21.08% per year, placing it in the top 7% of its Lipper
grouping (14th out of 227). For the five-year period ended
March 31, 1997, this Fund reflected an annualized return of
19.00%, and ranked in the top 5% of its Lipper grouping (5th
out of 105). Since inception (14 1/4 years ended March 31,
1997), the Emerging Growth Equity Fund achieved an annual
return of 15.08%, outperforming the benchmark's annualized
return of 12.73% for the same period. This since inception
performance ranked the Fund in the top 16% of the Lipper Small
Company Growth Funds grouping (3rd out of 19 funds).
INTERNATIONAL EQUITY FUND
The International Equity Fund returned 1.94% for the six-month
period ended March 31, 1997, while the Lipper International
Equity Funds Average was up 5.24%. For the one-year period
ended March 31, 1997, the Fund returned 5.85%, while its Lipper
benchmark returned 8.71%. The Fund returned 8.02%, annualized,
for the three-year period ended March 31, 1997, comparing
favorably to the 7.48% annualized return of its benchmark.
Since inception (12 11/12 years ended March 31, 1997), the Fund
had an annualized return of 12.63%, trailing the Lipper
International Equity Funds Average return of 13.58% per year
for this period.
However, it's important to note that the International
Equity Fund's since inception return was achieved with
appreciably less risk (as measured by standard deviation) than
the market, as measured by the MSCI EAFE Index. The standard
deviation of return for the Fund was 14.33 versus 18.22 for the
index over this time period.
FIXED-INCOME FUNDS
In the fourth quarter of 1996, inflation remained under
control, as the Consumer Price Index (CPI) was up 0.5% for the
period. It was a period when interest rates throughout the
yield curve were declining most of the time, and a period
during which the Federal Reserve (late in the quarter) was
becoming more sensitive to underlying inflationary concerns as
a result of the robust economy. For the longer-term portion of
the yield curve, fixed-income total returns (interest plus
price changes), as measured by the Lehman Brothers Aggregate
Bond Index, rose 3.00% for the quarter. For the short- to
intermediate-term securities (represented by the Lehman
Brothers Government-Intermediate Bond Index), the total
quarterly return was up 2.31%; cash equivalent-type investments
(90-Day U.S. Treasury Bills) increased 1.22% for this period.
The first quarter of 1997 (like the first quarter of 1996)
reflected a turn in events--intermediate and longer-term
interest rates rose substantially, with the 5-year Treasury
increasing to 6.75% at quarter's end from 6.21% at December 31,
1996, and the 30-year Treasury up to 7.09% at March 31, 1997,
from 6.64% at
4
<PAGE>
December 31, 1996. On March 25, 1997, the Federal Reserve (FED)
Committee increased the Federal Funds Rate by 25 basis points
to 5.50%, but kept the Discount Rate unchanged at 5.00% (this
was the first action taken by the FED in 14 months). Moreover,
the outlook remains bright for continued strong economic
growth, thereby strengthening inflationary concerns and further
increases in interest rates. As a result of the conditions that
prevailed during the first quarter, the bond markets reflected
negative returns (the same situation that also prevailed for
the first quarter of 1996), but finished the fiscal half year
ended March 31, 1997 with positive results at 2.42% for the
Lehman Brothers Aggregate Bond Index and 2.29% for the Lehman
Brothers Government-Intermediate Bond Index. Cash
equivalent-type securities (90-Day U.S. Treasury Bills)
returned 1.24% for the recent quarter and 2.48% for the six
months ended March 31, 1997.
INTERMEDIATE-TERM BOND FUND
For the six-month period ended March 31, 1997, the
Intermediate-Term Bond Fund returned 2.42%, edging the 2.25%
return of its benchmark, the Lipper Short-Intermediate (1 to 5
year maturity) U.S. Government Funds Average. Over every longer
term period, as well, this Fund outperformed its Lipper
benchmark. For the five-year period ended March 31, 1997, it
returned 6.00% per year, compared to the 5.56% annual return of
its benchmark. Since inception (14 1/4 years ended March 31,
1997), this Fund, at an annualized return of 8.96%,
outperformed its benchmark by 50 basis points per year (8.96%
versus 8.46%, respectively), and was the top performing fund in
its Lipper grouping for this period.
The Intermediate-Term Bond Fund continues to emphasize
quality of holdings, with over 95% in U.S. Government and other
AAA-rated securities. At March 31, 1997, the average maturity
and average duration of all portfolio holdings was 3.2 years
and 2.8 years, respectively, versus 3.8 years and 3.2 years,
respectively, at the start of fiscal year 1997.
ACTIVELY MANAGED BOND FUND
The Actively Managed Bond Fund outperformed its benchmark, the
Lipper U.S. Government Bond Funds Average, for every period
ended March 31, 1997. For the fiscal year-to-date, the Fund
returned 2.08% versus 1.82% for the Lipper benchmark. For the
five-year period ended March 31, 1997, the Fund, with an
annualized return of 6.98%, outpaced the benchmark's annualized
return of 6.06% by 92 basis points per year, and placed in the
top 19% (14th out of 75 funds) of its Lipper grouping for the
same period. Since inception (14 1/4 years ended March 31,
1997), the Fund's annualized return was 9.26%, and outperformed
the Lipper benchmark by .69% per year (9.26% versus 8.57%,
respectively). For the period, the Fund ranked in the top 29%
of the Lipper U.S. Government Bond Funds grouping (2nd out of 7
funds).
The Fund continues to emphasize quality of holdings, with
more than 95% in U.S. Government and other AAA-rated
securities. At March 31, 1997, the average maturity and average
duration of portfolio holdings was 8.2 years and 5.6 years,
respectively, compared to 7.6 years and 5.3 years,
respectively, at the start of fiscal year 1997.
5
<PAGE>
SHORT-TERM INVESTMENT FUND
For the six months ended March 31, 1997, the Short-Term
Investment Fund posted a return of 2.27% and trailed the 2.44%
return of the Donoghue All-Taxable Money Funds Average (a
representative benchmark). Since inception (14 1/4 years ended
March 31, 1997), the Fund produced an annual return of 6.48%,
exceeding the Donoghue benchmark's annualized return of 6.27%.
The Short-Term Investment Fund continues to emphasize
quality of holdings, with 93.5% in U.S. Government securities,
5.9% in A1+/P1 rated commercial paper, 0.3% in AA-rated
securities and 0.3% in A-rated issues. The average maturity of
portfolio holdings increased to 80 days at March 31, 1997, from
67 days at September 30, 1996.
6
<PAGE>
EQUITY FUNDS
NET INVESTMENT PERFORMANCE1
FOR PERIODS ENDED MARCH 31, 1997
---------------------------------------------------------------
<TABLE>
<CAPTION>
Annualized
-------------------------------------------------
Since
6 Months 1 Year 3 Years 5 Years 10 Years Inception2
----------- ---------- ---------- ---------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
CORE EQUITY FUND 7.09% 18.37% 21.32% 16.20% 12.24% 15.98%
VALUE EQUITY FUND 12.83 21.50 20.66 14.66 10.42 12.53
Lipper Growth &
Income Funds
Average3 8.63 15.47 17.89 14.21 11.59 14.33
EMERGING GROWTH
EQUITY FUND (8.60) 5.16 21.08 19.00 13.24 15.08
Lipper Small
Company Growth
Funds Average3 (4.60) 4.67 13.63 13.34 11.14 12.73
INTERNATIONAL
EQUITY FUND 1.94 5.85 8.02 10.88 6.40 12.63
Lipper
International
Equity Funds
Average3 5.24 8.71 7.48 11.17 8.70 13.58
</TABLE>
1. All performance results shown are net of management fees
and all related expenses, unless otherwise footnoted.
2. The International Equity Fund was started on May 1, 1984.
The inception date for all other funds was January 1, 1983.
3. Lipper Analytical Services is an independent reporting
service that measures the performance of most U.S. mutual
funds. The performance results reflect an unmanaged index
and are net of all expenses other than sales charges and
redemption fees.
---------------------------------------------------------------
7
<PAGE>
FIXED-INCOME FUNDS
NET INVESTMENT PERFORMANCE1
FOR PERIODS ENDED MARCH 31, 1997
---------------------------------------------------------------
<TABLE>
<CAPTION>
Annualized
-------------------------------------------------
Since
6 Months 1 Year 3 Years 5 Years 10 Years Inception2
------------ ---------- ---------- ---------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
INTERMEDIATE-TERM
BOND FUND 2.42% 4.78% 5.61% 6.00% 7.20% 8.96%
Lipper Short-
Intermediate
(1 to 5 year
maturity) U.S.
Government Funds
Average3 2.25 4.38 5.11 5.56 6.97 8.46
ACTIVELY MANAGED
BOND FUND 2.08 4.28 5.93 6.98 7.42 9.26
Lipper U.S.
Government Bond
Funds Average3 1.82 3.48 5.27 6.06 6.75 8.57
SHORT-TERM
INVESTMENT FUND 2.27 4.65 4.67 3.83 5.49 6.48
Donoghue All-
Taxable Money
Fund Average4 2.44 4.92 4.91 4.10 5.55 6.27
</TABLE>
1. All performance results shown are net of management fees
and all related expenses, unless otherwise footnoted.
2. The inception date was January 1, 1983.
3. Lipper Analytical Services is an independent reporting
service that measures the performance of most U.S. mutual
funds. The performance results reflect an unmanaged index
and are net of all expenses other than sales charges and
redemption fees.
4. Reported by the Donoghue Money Fund Reporting Service. The
performance results reflect an unmanaged index and are net,
since expenses are applicable.
---------------------------------------------------------------
8
<PAGE>
FINANCIAL STATEMENTS OF INVESTMENT FUNDS
RSI RETIREMENT TRUST
Combined Statement of Assets and Liabilities March 31, 1997
(Unaudited)
---------------------------------------------------------------
<TABLE>
<S> <C> <C>
ASSETS:
Investments in securities at value (Cost
$450,773,959)--Note 2(A) $579,868,744
Cash 1,204,091
Receivable for investments sold 1,825,659
Receivable for units sold 716,792
Dividends and interest receivable 3,165,204
Other assets 58,237
Net gain on forward foreign currency
contracts 57,665
------------
586,896,392
LIABILITIES:
Options written (premiums received $37,376) $ 7,738
Payable for investments purchased 3,958,038
Payable for units redeemed 668,617
Payable to investment managers 256,513
Accrued expenses 548,055
Other liabilities 303 5,439,264
---------- ------------
NET ASSETS--Note 5 $581,457,128
------------
------------
</TABLE>
Combined Statement of Operations Six Months Ended March 31,
1997 (Unaudited)
---------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Income:
Interest $8,739,163
Dividends (Net of foreign taxes of
$6,833) 2,743,370
----------
Total Income $11,482,533
Expenses:
Investment managers's fees--Note 3(A) 1,753,867
Shareholder servicing fees and
expenses--Note 3(B) 1,376,847
Custodian fees and expenses 176,211
Legal and auditing fees 77,072
Consultant fees 36,479
Trustees' fees and expenses--Note 3(C) 117,638
Other 178,374
----------
Total Expenses 3,716,488
Less fees paid indirectly--Note 4 (25,600)
Less expense reimbursement--Note 3(A) (59,292)
----------
Net Expenses 3,631,596
------------
INVESTMENT INCOME--NET 7,850,937
REALIZED AND UNREALIZED GAIN (LOSS)--Note 4:
Net realized gain (loss) on:
Investments 44,311,607
Foreign Currency Transactions (59,793)
----------
44,251,814
----------
Unrealized appreciation (depreciation) on:
Investments (28,438,668)
Written call options (18,305)
Foreign currency translations of other
assets and liabilities 54,978
----------
(28,401,995)
----------
NET REALIZED AND UNREALIZED GAIN 15,849,819
------------
NET INCREASE IN NET ASSETS RESULTING FROM
OPERATIONS $ 23,700,756
------------
------------
</TABLE>
See Notes to Financial Statements
9
<PAGE>
RSI RETIREMENT TRUST (CONTINUED)
Combined Statement of Changes in Net Assets
---------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months
Ended Year Ended
3/31/97 9/30/96
(Unaudited) (Audited)
------------- -------------
<S> <C> <C>
OPERATIONS
Investment income--net $ 7,850,937 $ 17,580,891
Net realized gain on investments 44,251,814 34,031,060
Unrealized appreciation (depreciation) (28,401,995) 32,838,455
------------- -------------
Net increase in net assets resulting from operations 23,700,756 84,450,406
------------- -------------
CAPITAL TRANSACTIONS--Note 5
Value of units sold 43,434,592 91,183,749
Value of units redeemed (137,729,692) (121,085,914)
------------- -------------
Net (decrease) in net assets resulting from capital
transactions (94,295,100) (29,902,165)
------------- -------------
Net increase (decrease) (70,594,344) 54,548,241
NET ASSETS at beginning of period 652,051,472 597,503,231
------------- -------------
NET ASSETS at end of period $ 581,457,128 $ 652,051,472
------------- -------------
------------- -------------
</TABLE>
See Notes to Financial Statements
10
<PAGE>
CORE EQUITY FUND
Statement of Investments
March 31, 1997 (Unaudited)
- ----------------------------------------------
<TABLE>
<CAPTION>
Shares Value
- ----------- ------------
<C> <S> <C> <C>
COMMON STOCKS 98.5%
AEROSPACE 5.3%
1,100 Boeing Corp. $ 108,487
122,300 Lockheed Martin Corp. 10,273,200
------------
10,381,687
------------
AUTOMOBILES 1.0%
62,562 Chrysler Corporation 1,876,860
------------
BANKING 5.1%
28,400 BankAmerica Corp. 2,861,300
32,488 Chase Manhattan Corp. 3,041,688
38,900 Citicorp 4,210,925
------------
10,113,913
------------
BUILDING PRODUCTS 3.3%
90,500 Armstrong World
Industries Inc. 5,859,875
22,000 Martin Marietta Materials 566,500
------------
6,426,375
------------
CHEMICALS 2.2%
40,000 E.I. Du Pont De Nemours &
Company 4,240,000
------------
COMPUTER SYSTEMS 1.1%
16,100 International Business
Machines Corp. 2,211,737
------------
DRUG AND HEALTH CARE 12.2%
253,900 Johnson & Johnson 13,424,963
124,800 Merck & Company Inc. 10,514,400
------------
23,939,363
------------
ELECTRONICS AND
ELECTRICAL 14.8%
25,400 Cisco Systems Inc.* 1,222,375
41,600 Electronic Data Systems
Corp. 1,679,600
3,700 EMC Corp. 131,350
115,800 Emerson Electric Company 5,211,000
55,700 General Electric Company 5,528,225
84,800 Hewlett Packard Corp. 4,515,600
77,600 Intel Corp. 10,786,400
1,700 Seagate Technology Inc. 76,288
------------
29,150,838
------------
ENERGY 10.8%
40,400 Amoco Corp. 3,499,650
138,000 Dresser Industries Inc. 4,174,500
39,400 Royal Dutch Petroleum
Company 6,895,000
61,400 Texaco Inc. 6,723,300
------------
21,292,450
------------
<CAPTION>
Shares Value
- ----------- ------------
<C> <S> <C> <C>
ENGINEERING AND
CONSTRUCTION 3.3%
123,400 Fluor Corp. $ 6,478,500
------------
FINANCIAL SERVICES 8.1%
215,700 Federal National Mortgage
Association 7,792,163
47,000 Morgan (J.P.) & Company
Inc. 4,617,750
25,200 Sunamerica, Inc. 948,150
44,400 Sunamerica, Inc. Pfd 1,753,800
17,200 Travelers Group, Inc. 823,450
------------
15,935,313
------------
FOOD AND SERVICES 0.7%
37,100 Dole Food Company 1,400,525
------------
HOUSEHOLD PRODUCTS 2.1%
35,900 Procter & Gamble Company 4,128,500
------------
INSURANCE 2.0%
65,300 Allstate Corp. 3,877,187
------------
MACHINERY AND ENGINEERING 2.2%
8,200 Cincinnati Milacron Inc. 153,750
29,700 Deere & Company 1,291,950
66,600 Ingersoll-Rand Company 2,905,425
------------
4,351,125
METALS AND MINING 1.8%
15,500 Phelps Dodge Corp. 1,133,438
31,800 Potash Corp. of
Saskatchewan 2,416,800
------------
3,550,238
------------
MISCELLANEOUS 1.7%
29,700 Philip Morris Companies
Inc. 3,389,513
------------
MULTI INDUSTRY 2.6%
72,500 Allied Signal Inc. 5,165,625
------------
OFFICE AND BUSINESS
EQUIPMENT 2.7%
92,200 Xerox Corp. 5,243,875
------------
PHARMACEUTICALS 1.8%
42,400 Pfizer Inc. 3,566,900
------------
SOFTWARE 8.0%
800 BMC Software, Inc. 36,800
50,050 Computer Associates
International, Inc. 1,945,694
120,000 Informix Corp.* 1,800,000
38,600 Microsoft Corp.* 3,536,725
213,200 Oracle Systems Corp.* 8,208,200
700 Parametric Technology
Corp.* 31,500
</TABLE>
See Notes to Financial Statements 11
<PAGE>
CORE EQUITY FUND (CONTINUED)
Statement of Investments
March 31, 1997 (Unaudited)
- ----------------------------------------------
<TABLE>
<CAPTION>
Shares Value
- ----------- ------------
5,700 Structural Dynamics
Research* $ 116,850
<C> <S> <C> <C>
------------
15,675,769
------------
TELECOMMUNICATIONS 5.7%
300 ADC Telecommunications* 8,063
150,700 GTE Corp. 7,026,387
51,741 Lucent Technologies, Inc. 2,729,337
42,000 Tellabs Inc.* 1,512,000
------------
11,275,787
------------
Total Common and Preferred Stocks (Cost
$84,851,351) $193,672,080
------------
<CAPTION>
Principal
Amount
- -----------
<C> <S> <C> <C>
SHORT TERM INVESTMENTS
REPURCHASE AGREEMENT 1.2%
$ 2,464,650 Bear Stearns & Co. Inc.
Dated 3/31/1997 6.28%
due 4/1/1997
collateralized by
$12,690,000 United
States Treasury Strips
due 8/15/2009 (Value
$2,514,270) 2,464,650
------------
Total Investments (Cost $87,316,001) 99.7% $196,136,730
------ ------------
</TABLE>
<TABLE>
<CAPTION>
Expiration Date
# of /
Contracts Strike Price Value
- --------- --------------- ------------
<C> <S> <C> <C> <C>
WRITTEN COVERED CALL OPTIONS
Intel Corp. April 1997 /
4 170 $ (50)
10 Johnson & Johnson July 1997 / 65 (500)
30 Merck & Company Inc. April 1997 / 95 (563)
Microsoft Corp. April 1997 /
15 115 (188)
Procter & Gamble Company April 1997 /
20 115 (6,000)
Procter & Gamble Company April 1997 /
10 125 (437)
------------
Total Options (Premiums Received $37,376) $ (7,738)
------------
Other Assets, Less Liabilities 0.3% 601,161
------ ------------
Net Assets 100.0% $196,730,153
------ ------------
------ ------------
</TABLE>
*Denotes non-income producing security.
See Notes to Financial Statements 12
<PAGE>
CORE EQUITY FUND (CONTINUED)
Statement of Assets and Liabilities March 31, 1997 (Unaudited)
---------------------------------------------------------------
<TABLE>
<S> <C> <C>
ASSETS:
Investments in securities at value (Cost
$87,316,001)--Note 2(A) $196,136,730
Receivable for units sold 568,477
Dividends and interest receivable 343,903
Other assets 12,196
------------
197,061,306
LIABILITIES:
Options written (premiums received $37,376) $ 7,738
Payable for investments purchased 137,120
Payable to investment managers 91,214
Accrued expenses 95,081 331,153
-------- ------------
NET ASSETS at value, applicable to 3,247,583
outstanding units of
beneficial interest--Note 5 $196,730,153
------------
------------
NET ASSET VALUE offering and redemption price
per unit
($196,730,153 divided by 3,247,583 units) $ 60.58
------------
------------
</TABLE>
Statement of Operations Six Months Ended March 31, 1997
(Unaudited)
---------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Income:
Dividends $1,862,186
Interest 122,961
--------
Total Income $ 1,985,147
Expenses:
Investment manager's fees--Note 3(A) 567,554
Shareholder servicing fees and
expenses--Note 3(B) 346,020
Custodian fees and expenses 21,241
Legal and auditing fees 10,897
Consultant fees 5,212
Trustees' fees and expenses--Note 3(C) 14,753
Other 34,111
--------
Total Expenses 999,788
------------
INVESTMENT INCOME--NET 985,359
REALIZED GAIN AND UNREALIZED (LOSS) ON
INVESTMENTS--Note 4:
Net realized gain on investments 23,905,233
Unrealized (depreciation) on investments (7,825,541)
Unrealized (depreciation) on written call
options (18,305)
--------
NET REALIZED GAIN AND UNREALIZED (LOSS) ON
INVESTMENTS 16,061,387
------------
NET INCREASE IN NET ASSETS RESULTING FROM
OPERATIONS $ 17,046,746
------------
------------
</TABLE>
See Notes to Financial Statements
13
<PAGE>
CORE EQUITY FUND (CONTINUED)
Statement of Changes in Net Assets
---------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months
Ended Year Ended
3/31/97 9/30/96
(Unaudited) (Audited)
------------ ------------
<S> <C> <C>
OPERATIONS:
Investment income--net $ 985,359 $ 2,854,402
Net realized gain on investments 23,905,233 9,678,626
Unrealized appreciation (depreciation) on investments (7,825,541) 26,737,020
------------ ------------
Net increase in net assets resulting from operations 17,046,746 39,270,048
------------ ------------
CAPITAL TRANSACTIONS--Note 5:
Value of units sold 3,994,873 17,141,226
Value of units redeemed (41,667,798) (28,996,541)
------------ ------------
Net increase (decrease) in net assets resulting from capital
transactions (37,672,925) (11,855,315)
------------ ------------
Net increase (decrease) (20,626,179) 27,414,733
NET ASSETS at beginning of period 217,356,332 189,941,599
------------ ------------
NET ASSETS at end of period $196,730,153 $217,356,332
------------ ------------
------------ ------------
</TABLE>
See Notes to Financial Statements
14
<PAGE>
VALUE EQUITY FUND
Statement of Investments
March 31, 1997 (Unaudited)
- ----------------------------------------------
<TABLE>
<CAPTION>
Shares Value
- ----------- ------------
<C> <S> <C> <C>
COMMON STOCKS 99.0%
AEROSPACE 2.2%
13,400 Lockheed Martin Corp. $ 1,125,600
------------
AUTOMOBILES 4.3%
31,800 Chrysler Corporation 954,000
5,500 General Motors Corp. 304,563
23,700 Snap-On Tools Inc. 918,375
------------
2,176,938
------------
BANKING 12.2%
10,400 Banc One Corp. 413,400
15,000 BankAmerica Corp. 1,511,250
16,300 Chase Manhattan Corp. 1,526,088
9,900 Citicorp 1,071,675
16,700 Mellon Bank Corp. 1,214,925
6,600 Royal Bank Of Canada 257,400
800 Wells Fargo & Co. 227,300
------------
6,222,038
------------
BUILDING PRODUCTS 0.6%
5,100 Armstrong World
Industries Inc. 330,225
------------
CHEMICALS 2.6%
12,300 E.I. Du Pont De Nemours &
Company 1,303,800
------------
COMPUTER SYSTEMS 3.3%
15,700 Sun Microsystems Inc. 451,375
9,100 International Business
Machines Corp. 1,250,113
------------
1,701,488
------------
DRUG AND HEALTH CARE 7.6%
11,200 American Home Products
Corp. 672,000
24,000 Bristol-Myers Squibb
Company 1,416,000
8,800 Columbia HCA Healthcare
Corp. 295,900
21,300 Living Centers* 734,850
30,475 Tenet Healthcare
Corporation 750,446
------------
3,869,196
------------
ELECTRONICS AND
ELECTRICAL 3.7%
13,800 EMC Corp. 489,900
4,800 Intel Corp. 667,200
15,900 Kemet Corp.* 298,125
9,600 Seagate Technology Inc. 430,800
------------
1,886,025
------------
ENERGY 9.9%
7,100 Amoco Corp. 615,038
4,100 British Petroleum 562,660
<CAPTION>
Shares Value
- ----------- ------------
<C> <S> <C> <C>
17,200 Diamond Offshore Drilling $ 1,178,200
15,900 Dresser Industries Inc. 480,975
10,600 Exxon Corp. 1,142,150
6,000 Texaco Inc. 657,000
13,000 Ultramar Diamond Shamrock 412,750
------------
5,048,773
------------
ENGINEERING AND
CONSTRUCTION 0.5%
4,800 Fluor Corp. 252,000
------------
ENTERTAINMENT 1.5%
27,200 Carmike Cinemas 778,600
------------
FINANCIAL SERVICES 8.0%
29,000 Federal National Mortgage
Association 1,047,625
7,300 Sunamerica, Inc. 274,663
32,100 Sunamerica, Inc. Pfd 1,267,950
30,400 Travelers Group, Inc. 1,455,400
------------
4,045,638
------------
FOOD AND SERVICES 1.8%
24,000 Dole Food Company 906,000
------------
FOREST PRODUCTS AND PAPER 0.7%
7,100 Mead Corp. 376,300
------------
INSURANCE 2.5%
21,600 Allstate Corp. 1,282,500
------------
MACHINERY AND ENGINEERING 2.8%
25,600 Cincinnati Milacron Inc. 480,000
21,200 Deere & Company 922,200
------------
1,402,200
------------
METALS AND MINING 3.5%
9,800 Aluminum Company Of
America 666,400
6,500 Phelps Dodge Corp. 475,312
8,600 Potash Corp of
Saskatchewan 653,600
------------
1,795,312
------------
MULTI INDUSTRY 7.0%
14,500 Philip Morris Companies
Inc. 1,654,813
8,100 Allied Signal Inc. 577,125
17,600 United Technologies Corp. 1,324,400
------------
3,556,338
------------
</TABLE>
See Notes to Financial Statements 15
<PAGE>
VALUE EQUITY FUND (CONTINUED)
Statement of Investments
March 31, 1997 (Unaudited)
- ----------------------------------------------
<TABLE>
<CAPTION>
Shares Value
- ----------- ------------
OFFICE AND BUSINESS
EQUIPMENT 3.5%
<C> <S> <C> <C>
28,800 Lexmark Intl Group
Inc--Cl A $ 698,400
18,600 Xerox Corp. 1,057,875
------------
1,756,275
------------
RETAIL 2.6%
15,600 Federated Department
Stores 512,850
15,900 Sears Roebuck & Company 798,975
------------
1,311,825
------------
SOFTWARE 1.4%
17,900 Computer Associates
International, Inc. 695,863
------------
TELECOMMUNICATIONS 9.3%
4,800 American Telephone &
Telegraph Corp. 166,800
17,700 GTE Corp. 825,263
24,500 MCI Communications 869,750
19,700 Nynex Corp. 898,812
48,900 US West Inc. 1,662,600
16,800 US West Media Group 312,900
------------
4,736,125
------------
<CAPTION>
Shares Value
- ----------- ------------
<C> <S> <C> <C>
UTILITIES 7.5%
44,100 Cinergy Corp. $ 1,504,912
5,200 Duke Power Co. 229,450
27,300 Nicor Inc. 873,600
15,000 Peoples Energy Corp. 496,874
42,100 Washington Water Power
Company 731,487
------------
3,836,323
------------
Total Common and Preferred Stocks (Cost
$43,498,529) $ 50,395,382
------------
<CAPTION>
Principal
Amount
- -----------
<C> <S> <C> <C>
SHORT TERM INVESTMENTS
REPURCHASE AGREEMENT 1.6%
$ 745,048 Bear Stearns & Co. Inc.
Dated 3/31/1997 6.28%
due 4/1/1997
collateralized by
$4,800,000 United
States Treasury
Securities due
11/15/2022
(Value $760,512) $ 745,048
------------
Total Investments (Cost $44,243,577) 100.6% $ 51,140,430
Liabilities, net of other assets -0.6% (280,900)
------ ------------
Net Assets 100.0% $ 50,859,530
------ ------------
------ ------------
</TABLE>
*Denotes non-income producing security.
See Notes to Financial Statements 16
<PAGE>
VALUE EQUITY FUND (CONTINUED)
Statement of Assets and Liabilities March 31, 1997 (Unaudited)
---------------------------------------------------------------
<TABLE>
<S> <C> <C>
ASSETS:
Investments in securities at value (Cost
$44,243,577)--Note 2(A) $51,140,430
Receivable for investments sold 625,659
Receivable for units sold 255
Dividends and interest receivable 108,351
Other assets 7,128
-----------
51,881,823
LIABILITIES:
Payable for investments purchased $937,347
Payable to investment managers 19,508
Accrued expenses 65,438 1,022,293
-------- -----------
NET ASSETS at value, applicable to 1,136,370 outstanding
units of
beneficial interest--Note 5 $50,859,530
-----------
-----------
NET ASSET VALUE offering and redemption price per unit
($50,859,530 divided by 1,136,370 units) $ 44.76
-----------
-----------
</TABLE>
Statement of Operations Six Months Ended March 31, 1997
(Unaudited)
---------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Income:
Dividends $ 646,688
Interest 78,071
----------
Total Income $ 724,759
Expenses:
Investment manager's fees--Note 3(A) 117,587
Shareholder servicing fees and expenses--Note 3(B) 147,648
Custodian fees and expenses 22,582
Legal and auditing fees 9,701
Consultant fees 5,212
Trustees' fees and expenses--Note 3(C) 14,753
Other 20,933
----------
Total Expenses 338,416
----------
INVESTMENT INCOME--NET 386,343
REALIZED GAIN AND UNREALIZED (LOSS) ON INVESTMENTS--Note
4:
Net realized gain on investments 9,007,416
Unrealized (depreciation) on investments (2,539,419)
----------
NET REALIZED GAIN AND UNREALIZED (LOSS) ON INVESTMENTS 6,467,997
----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $6,854,340
----------
----------
</TABLE>
See Notes to Financial Statements
17
<PAGE>
VALUE EQUITY FUND (CONTINUED)
Statement of Changes in Net Assets
---------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months
Ended Year Ended
3/31/97 9/30/96
(Unaudited) (Audited)
----------- -----------
<S> <C> <C>
OPERATIONS:
Investment income--net $ 386,343 $ 963,025
Net realized gain on investments 9,007,416 4,551,286
Unrealized appreciation (depreciation) on
investments (2,539,419) 3,977,314
----------- -----------
Net increase in net assets resulting from
operations 6,854,340 9,491,625
----------- -----------
CAPITAL TRANSACTIONS--Note 5:
Value of units sold 2,206,788 6,089,364
Value of units redeemed (10,432,546) (7,173,870)
----------- -----------
Net (decrease) in net assets resulting from
capital transactions (8,225,758) (1,084,506)
----------- -----------
Net increase (decrease) (1,371,418) 8,407,119
NET ASSETS at beginning of period 52,230,948 43,823,829
----------- -----------
NET ASSETS at end of period $50,859,530 $52,230,948
----------- -----------
----------- -----------
</TABLE>
See Notes to Financial Statements
18
<PAGE>
EMERGING GROWTH EQUITY FUND
Statement of Investments
March 31, 1997 (Unaudited)
- ----------------------------------------------
<TABLE>
<CAPTION>
Shares Value
- ---------- -----------
<C> <S> <C> <C>
COMMON STOCKS 92.9%
APPAREL AND TEXTILE 3.6%
10,000 Dress Barn* $ 168,750
6,300 Gadzooks Inc.* 198,450
30,000 Genesco Inc.* 337,500
30,000 Goody's Family Clothing,
Inc.* 690,000
16,560 St. John Knits Inc. 716,220
50,000 Vans, Inc.* 587,500
-----------
2,698,420
-----------
AUTOMOTIVE PRODUCTS 1.9%
31,600 Mascotech, Inc. 647,800
17,100 SPX Inc. 775,912
-----------
1,423,712
-----------
BROADCASTING AND
PUBLISHING 1.1%
12,500 Granite Broadcasting
Corp.* 120,313
7,600 Heftel Broadcasting Corp.
Class A* 349,600
4,510 SFX Broadcasting Inc.* 127,408
3,200 Sinclair Broadcast Group
Inc.* 83,200
6,125 Young Broadcasting Corp.
Class A* 146,234
-----------
826,755
-----------
BUILDING AND CONSTRUCTION 0.9%
10,000 Apogee Enterprises Inc.* 192,500
40,700 Dycom Industries, Inc.* 493,488
-----------
685,988
-----------
BUSINESS AND PUBLIC
SERVICES 6.7%
10,300 Aames Financial Corp. 208,575
7,150 Acres Gaming, Inc.* 33,069
36,300 Americredit Corp.* 630,713
22,900 Ameritrade Holding Corp.
Class A* 357,812
3,400 Carriage Services, Inc.* 64,600
3,100 CCC Information Services
Group* 36,425
5,700 Claremont Technology
Group* 133,950
5,800 Computer Task Group Inc. 205,900
15,063 Concord Efs, Inc.* 282,431
13,000 Cotelligent Group Inc.* 117,000
4,650 Delta Financial Corp.* 84,281
13,750 Equity Corporation
International* 288,750
14,054 Keane Inc.* 462,025
6,300 Lamar Advertising Co.* 124,425
2,900 Learning Tree
International, Inc.* 80,475
3,000 Metzler Group, Inc.* 64,875
4,200 Outdoor Systems, Inc.* 121,800
4,600 PJ America Inc.* 65,550
10,100 Precision Response Corp.* 238,613
8,700 Raptor Systems, Inc.* 112,013
11,450 Splash Technologies
Holdings* 280,525
<CAPTION>
Shares Value
- ---------- -----------
<C> <S> <C> <C>
8,400 Strayer Education Inc.* $ 163,800
4,550 Sykes Enterprises, Inc.* 143,894
2,900 The Registry, Inc.* 101,500
5,100 Universal Outdoor
Holdings* 147,900
50,000 Warrantech Corp.* 450,000
-----------
5,000,901
-----------
COMMERCIAL SERVICES 5.8%
30,000 Amresco, Inc.* 495,000
26,000 Banctec, Inc.* 663,000
9,250 Brightpoint Inc.* 150,313
5,900 Corestaff Inc.* 114,313
11,800 Fine Host Corp.* 275,825
5,800 FYI Inc.* 118,175
8,000 Judge Group, Inc.* 28,500
8,000 Lason Holdings Inc.* 158,000
15,000 Mail-well, Inc.* 296,250
7,200 National Techteam Inc.* 111,600
9,200 NCO Group, Inc.* 197,800
11,950 PMT Services Inc.* 129,956
11,700 Promedco Management Co.* 105,300
6,550 Robert Half International
Inc.* 228,431
8,400 Superior Services Inc.* 186,900
20,000 Windmere Corp. 282,500
-----------
3,541,863
-----------
CONSUMER GOODS AND
SERVICES 5.8%
8,550 Blyth Industries Inc.* 308,869
8,500 Cuno Inc.* 130,688
14,000 Finish Line (The) Class
A* 308,000
34,400 French Fragrances, Inc.* 258,000
5,300 General Cigar Holding,
Inc.* 117,925
13,700 Marks Bros. Jewelers
Inc.* 160,975
5,700 Metris Companies, Inc.* 141,075
10,270 Nautica Enterprises Inc.* 256,750
17,350 Rexall Sundown, Inc.* 444,593
10,000 Showbiz Pizza Time Inc.* 175,000
12,600 Signature Resorts Inc.* 296,100
11,990 Stewart Enterprises Inc. 434,637
15,100 Team Rental Group Inc.* 309,550
15,500 The North Face, Inc.* 255,750
4,500 Watsco, Inc. * 114,750
16,996 Wolverine World Wide 620,345
-----------
4,333,007
-----------
DATA PROCESSING 1.6%
30,000 Chs Electronics, Inc.* 592,500
8,500 Data Processing
Resources* 157,250
12,500 Micros Systems, Inc.* 428,125
-----------
1,177,875
-----------
</TABLE>
See Notes to Financial Statements 19
<PAGE>
EMERGING GROWTH EQUITY FUND (CONTINUED)
Statement of Investments
March 31, 1997 (Unaudited)
- ----------------------------------------------
<TABLE>
<CAPTION>
Shares Value
- ---------- -----------
ELECTRONICS AND
ELECTRICAL 9.3%
<C> <S> <C> <C>
11,100 Actel Corp.* $ 241,425
17,300 Advanced Lighting Techs* 380,600
3,300 Benchmarq
Microelectronics* 40,012
15,000 Berg Electronics Corp.* 427,500
20,000 Calpine Corp.* 362,500
4,300 CFM Technologies Inc.* 125,775
19,700 Computer Products Inc.* 288,113
12,932 Credence Systems Corp.* 250,548
12,650 C.P. Clare Corp.* 126,500
25,200 Dallas Semiconductor 667,800
15,535 Del Global Technologies
Corp.* 128,163
4,500 Electromagnetic Sciences,
Inc.* 83,250
13,100 Elexsys International
Inc.* 157,200
3,200 Enterprise Systems* 72,000
7,500 Flextronics International
Ltd.* 147,187
2,200 Helix Technology Corp. 72,050
11,900 Integrated Circuit
Systems* 169,575
21,000 Jabil Circuit Inc.* 945,000
8,900 JPM Company* 144,625
4,300 Micrel, Inc.* 124,700
7,300 Micro Linear Corp.* 90,337
2,300 Photronics, Inc.* 67,563
17,000 Reptron Electronics Inc.* 337,875
7,600 Sanmina Corp.* 339,150
10,200 SDL Inc.* 170,850
7,100 Sierra Semiconductor
Corp.* 114,488
10,000 Supertex Inc.* 117,500
15,000 Tech Data Corp.* 361,875
3,000 Triumph Group, Inc.* 75,375
6,800 Ultrak, Inc.* 119,000
10,300 Ultratech Stepper Inc.* 225,312
-----------
6,973,848
-----------
EMPLOYMENT AGENCY 0.2%
5,475 On Assignment Inc.* 136,875
-----------
ENTERTAINMENT 1.9%
40,000 Action Performance Co,
Inc.* 780,000
4,000 Family Golf Centers,
Inc.* 76,500
13,300 Penn National Gaming
Inc.* 209,475
7,000 Penske Motorsports Inc.* 196,000
4,550 Regal Cinemas Inc.* 122,850
-----------
1,384,825
-----------
FOOD AND SERVICES 1.0%
22,500 CKE Restaurants, Inc. 497,812
5,900 Mortons Restaurant Group
Inc.* 99,562
<CAPTION>
Shares Value
- ---------- -----------
<C> <S> <C> <C>
7,000 Rainforest Cafe, Inc.* $ 138,250
-----------
735,624
-----------
FURNITURE/HOME APPLIANCES 0.7%
11,900 Cort Business Services
Corp.* 270,725
27,800 Rowe Furniture Corp. 218,925
-----------
489,650
-----------
INSURANCE 2.4%
5,400 Compdent Corp.* 151,200
5,300 CRA Managed Care, Inc.* 196,100
19,725 HCC Insurance Holdings
Inc. 483,263
8,000 Prepaid Legal Services,
Inc.* 119,000
8,000 Provident American Corp.* 71,000
6,755 Reinsurance Group of
America, Inc. 327,617
21,000 United Cos. Financial
Corp. 433,125
-----------
1,781,305
-----------
LODGING/MOTELS 0.7%
22,000 Prime Hospitality Corp.* 343,750
8,675 Studio Plus Hotels, Inc.* 149,643
-----------
493,393
-----------
MACHINERY AND ENGINEERING 8.3%
25,000 AAR Corp. 750,000
20,000 Applied Power Inc. 840,000
20,000 Be Aerospace, Inc.* 490,000
118,200 JLG Industries Inc. 2,319,675
40,000 Maverick Tube Corp.* 700,000
5,000 Memtec Ltd. 126,875
21,500 Miller Industries Inc.* 258,000
25,000 Omniquip International,
Inc.* 362,500
7,700 Remec, Inc.* 155,925
9,600 Rental Service Corp.* 175,200
1,900 Veeco Instruments Inc.* 55,812
-----------
6,233,987
-----------
MEDICAL SERVICES AND
DRUGS 9.2%
16,000 Adac Laboratories* 330,000
13,950 American Homepatient
Inc.* 306,900
6,900 Amrion, Inc.* 112,987
29,000 Ballard Medical Products 605,375
13,100 Cytyc Corp.* 245,625
13,960 Dura Pharmaceuticals
Inc.* 497,325
4,300 Idexx Laboratories Inc.* 60,200
7,800 Igen Inc.* 40,950
6,000 Impath, Inc.* 105,000
1,240 I-stat Corp.* 16,430
3,200 Lunar Corp.* 107,200
</TABLE>
See Notes to Financial Statements 20
<PAGE>
EMERGING GROWTH EQUITY FUND (CONTINUED)
Statement of Investments
March 31, 1997 (Unaudited)
- ----------------------------------------------
<TABLE>
<CAPTION>
Shares Value
- ---------- -----------
30,000 Medical Resources Inc.* $ 326,250
<C> <S> <C> <C>
27,900 Medicis Pharmaceutical
Class A* 823,050
6,200 Minimed, Inc.* 159,650
29,500 Mulicare Companies, Inc.* 556,813
6,950 National Surgery Centers
Inc.* 199,812
5,600 NCS Healthcare Inc. Class
A* 123,900
2,800 Pediatix Medical* 91,000
4,500 Pharmaceutical Product
Development* 87,750
5,500 Premier Research
Worldwide* 88,000
3,700 Renal Care Group Inc.* 117,475
50,000 Roberts Pharmaceutical
Corp.* 637,500
5,900 Sabratek Corp.* 115,050
8,700 Sangstat Medical Corp.* 235,988
2,900 United Dental Care Inc.* 78,300
90,000 Urohealth Systems Inc.* 843,750
-----------
6,912,280
-----------
OIL AND GAS 3.8%
25,500 Energy Ventures Inc.* 1,571,437
22,000 Offshore Logistics* 349,250
15,000 Precision Drilling Corp.* 633,750
13,000 Swift Energy Co.* 307,125
-----------
2,861,562
-----------
PRINTING 1.8%
28,000 Consolidated Graphics,
Inc. 805,000
23,000 Valassis Communication,
Inc. 514,625
-----------
1,319,625
-----------
RETAIL 10.0%
3,000 99 Cents Only Stores* 60,375
50,000 Ames Dept. Stores Inc.* 456,250
30,000 Ann Taylor Stores* 611,250
2,100 Barnett, Inc.* 41,475
40,600 Eagle Hardware & Garden* 730,800
25,000 Hollywood Entertainment
Corp.* 609,375
9,400 Loehmann's, Inc.* 164,500
25,300 MacFrugals* 670,450
4,300 Mazel Stores Inc.* 86,000
30,300 Petco Animal Supplies,
Inc.* 696,900
50,000 Pier 1 Imports Inc. 881,250
25,000 RDO Equipment Co. Class
A* 437,500
35,000 Stage Stores Inc.* 756,875
14,664 The Men's Wearhouse Inc.* 403,260
19,000 Tuesday Morning Corp.* 608,000
7,800 West Marine Inc.* 249,600
-----------
7,463,860
-----------
<CAPTION>
Shares Value
- ---------- -----------
<C> <S> <C> <C>
SOFTWARE 8.8%
37,100 Activision, Inc.* $ 408,100
7,200 Analysts International
Corp.* 156,600
2,800 Arbor Software Corp.* 70,000
11,600 Black Box Corp.* 311,750
5,200 BTG, Inc.* 91,000
29,000 Cognos Inc.* 739,500
11,806 Computer Horizons Corp.* 365,970
12,650 Computer Learning
Centers* 414,288
37,000 Data General Corp.* 629,000
10,000 Ikos Systems, Inc.* 168,750
44,100 Linens 'n Things Inc.* 1,030,838
2,014 Mcafee Associates Inc.* 88,868
10,100 Oak Technology Inc.* 102,263
20,000 Pomeroy Computer
Resources* 395,000
1,600 PRI Automation, Inc.* 75,200
2,823 Project Software &
Development, Inc.* 88,572
4,100 Red Brick Systems, Inc.* 55,863
5,900 Renaissance Solutions
Inc.* 147,500
8,500 SPSS, Inc.* 208,250
8,300 Summit Design, Inc.* 61,212
15,650 Technology Solutions
Company* 424,506
40,000 Viewlogic Systems Inc.* 560,000
-----------
6,593,030
-----------
TECHNOLOGY 2.5%
50,000 Apex PC Solutions Inc.* 425,000
14,800 DT Industries, Inc. 377,400
20,000 Dynatech* 600,000
44,400 Farah Incorporated* 444,000
-----------
1,846,400
-----------
TELECOMMUNICATIONS 3.5%
12,000 ACC Corp.* 264,000
4,300 Anadigics, Inc.* 116,100
20,600 Boston Technology Inc.* 388,825
11,300 Evergreen Media Corp.* 329,113
4,600 Intermedia Communications
Inc.* 75,325
2,800 Level One Communications* 74,900
32,850 Mastec, Inc.* 866,419
16,300 Midcom Communication
Inc.* 128,363
7,000 Natural Microsystems
Corp.* 139,125
11,393 Saga Communications Inc.
Class A* 236,405
-----------
2,618,575
-----------
TRANSPORTATION 1.4%
35,000 American West Airlines* 546,875
10,000 Celadon Group, Inc.* 106,250
</TABLE>
See Notes to Financial Statements 21
<PAGE>
EMERGING GROWTH EQUITY FUND (CONTINUED)
Statement of Investments
March 31, 1997 (Unaudited)
- ----------------------------------------------
<TABLE>
<CAPTION>
Shares Value
- ---------- -----------
16,010 Expeditors International
of Washington, Inc. $ 384,240
<C> <S> <C> <C>
-----------
1,037,365
-----------
Total Common Stocks (Cost
$58,681,481) $68,570,725
-----------
<CAPTION>
Principal
Amount Value
- ---------- -----------
<C> <S> <C> <C>
SHORT TERM INVESTMENTS
REPURCHASE AGREEMENTS 9.8%
$7,324,928 Bear Stearns & Co. Dated
3/31/1997 6.28% due
4/1/1997 Collateralized
by $13,890,000 United
States Treasury Strips
due 8/15/2019 (Value
$2,752,026) and
$9,895,000 United
States Treasury Strips
due 2/15/2021 (Value
$1,762,596) and
$4,895,000 United
States Treasury Strips
due 8/15/2004 (Value
$2,959,958) $ 7,324,928
-----------
Total Investments (Cost
$66,006,410) 101.6% $75,895,653
Liabilities, net of other assets -1.6% (1,159,804)
----- -----------
Net Assets 100.0% $74,735,849
----- -----------
----- -----------
</TABLE>
*Denotes non-income producing security.
See Notes to Financial Statements 22
<PAGE>
EMERGING GROWTH EQUITY FUND (CONTINUED)
Statement of Assets and Liabilities March 31, 1997 (Unaudited)
---------------------------------------------------------------
<TABLE>
<S> <C> <C>
ASSETS:
Investments in securities at value (Cost
$66,006,410)--Note 2(A) $75,895,653
Receivable for units sold 120,798
Dividends and interest receivable 43,012
Other assets 5,848
-----------
76,065,311
LIABILITIES:
Payable for investments purchased $1,168,417
Payable to investment managers 63,179
Accrued expenses 97,866 1,329,462
---------- -----------
NET ASSETS at value, applicable to 1,219,083 outstanding
units of beneficial interest--Note 5 $74,735,849
-----------
-----------
NET ASSET VALUE offering and redemption price per unit
($74,735,849 divided by 1,219,083 units) $ 61.30
-----------
-----------
</TABLE>
Statement of Operations Six Months Ended March 31, 1997
(Unaudited)
---------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Income:
Dividends $ 46,432
Interest 168,366
----------
Total Income $ 214,798
Expenses:
Investment manager's fees--Note 3(A) 504,033
Shareholder servicing fees and expenses--Note 3(B) 243,103
Custodian fees and expenses 45,997
Legal and auditing fees 11,098
Consultant fees 5,212
Trustees' fees and expenses--Note 3(C) 29,120
Other 24,217
----------
Total expenses 862,780
----------
Less fees paid indirectly--Note 4 (15,260)
----------
Net Expenses 847,520
----------
INVESTMENT (LOSS)--NET (632,722)
REALIZED GAIN AND UNREALIZED (LOSS) ON INVESTMENTS--Note
4:
Net realized gain on investments 8,249,687
Unrealized (depreciation) on investments (14,265,024)
----------
NET REALIZED GAIN AND UNREALIZED (LOSS) ON INVESTMENTS (6,015,337)
----------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS $(6,648,059)
----------
----------
</TABLE>
See Notes to Financial Statements
23
<PAGE>
EMERGING GROWTH EQUITY FUND (CONTINUED)
Statement of Changes in Net Assets
---------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months
Ended Year Ended
3/31/97 9/30/96
(Unaudited) (Audited)
----------- -----------
<S> <C> <C>
OPERATIONS:
Investment (loss)--net $ (632,722) $(1,250,419)
Net realized gain on investments 8,249,687 15,317,099
Unrealized appreciation (depreciation) on investments (14,265,024) 6,281,307
----------- -----------
Net increase (decrease) in net assets resulting from operations (6,648,059) 20,347,987
----------- -----------
CAPITAL TRANSACTIONS--Note 5:
Value of units sold 6,180,405 10,600,409
Value of units redeemed (16,932,411) (13,437,810)
----------- -----------
Net (decrease) in net assets resulting from capital transactions (10,752,006) (2,837,401)
----------- -----------
Net increase (decrease) (17,400,065) 17,510,586
NET ASSETS at beginning of period 92,135,914 74,625,328
----------- -----------
NET ASSETS at end of period $74,735,849 $92,135,914
----------- -----------
----------- -----------
</TABLE>
See Notes to Financial Statements
24
<PAGE>
INTERNATIONAL EQUITY FUND
Statement of Investments
March 31, 1997 (Unaudited)
- ----------------------------------------------
<TABLE>
<CAPTION>
Shares Value
- --------- -----------
<C> <S> <C> <C>
COMMON STOCKS 96.8%
AEROSPACE 1.0%
8,100 British Aerospace $ 181,481
46,500 Rolls Royce 174,085
-----------
355,566
-----------
APPAREL AND TEXTILE 3.1%
2,800 Adidas AG* 315,513
3,250 Fila Holdings Spa* 176,719
7,800 Gucci Group NV* 570,520
-----------
1,062,752
-----------
AUTOMOBILES 2.0%
30,000 Divers Res Bhd 98,012
10,600 Scania AB* 265,925
25,000 Suzuki Motor Corp. 242,310
33,000 Utd Tractors* 98,842
-----------
705,089
-----------
BANKING 6.3%
136,000 Bank International Indonesia* 103,251
130,000 Bank Negara Indonesia* 74,360
14,000 Bank of Tokyo-Mitsubishi Bank* 218,241
7,380 Far East Bank & Trust 32,750
30,000 Guoco Group 148,276
10,200 HSBC Holdings 236,932
12,250 HSBC Holdings UK 300,511
20,500 Malayan Banking Bhd 233,585
19,350 National Westminster 218,120
7,200 Nordbanken AB 248,484
21,232 Overseas Chinese Bank* 252,673
12,000 Sumitomo Trust & Bank 95,955
-----------
2,163,138
-----------
BROADCASTING AND PUBLISHING 1.6%
19,000 Elsevier NV* 308,941
12,250 Schibsted Asa* 248,791
-----------
557,732
-----------
BUILDING MATERIALS 2.6%
4,150 Asia Cement Gds* 75,468
28,000 Blue Circle Industries* 191,260
150,000 Boral Limited* 445,616
46,000 Cemex SA* 185,602
-----------
897,946
-----------
BUSINESS AND PUBLIC SERVICES 3.8%
8,000 Asatsu Inc. 207,417
1,710 SAP AG Non Voting Preferred* 291,800
5,000 Secom Company 280,676
<CAPTION>
Shares Value
- --------- -----------
<C> <S> <C> <C>
52,500 Securicor Group Ord $ 252,581
10,100 Securitas AB* 289,579
-----------
1,322,053
-----------
CHEMICALS 4.3%
1,850 Akzo Nobel NV* 265,700
40,000 Asahi Chemical Industries 208,064
7,170 Bayer AG* 301,688
275 Ciba Specialty* 22,716
24,000 Courtaulds 142,263
3,000 Novo-nordisk AS* 313,881
13,000 Shin-etsu Chemical Co. 246,752
-----------
1,501,064
-----------
CONSTRUCTION AND HOUSING 3.2%
141,100 Dmci Holdings Inc.* 100,346
3,000 Hyundai Eng And Con- St* 61,994
4,720 Ihc Caland Nv* 252,134
16,000 Kajima Corp. 74,438
104,000 Road King Infrastr* 101,328
16,000 Sekisui House Ord 156,371
500 Skanska Ab* 22,764
39,000 United Engineers Bhd* 339,774
-----------
1,109,149
-----------
ELECTRONICS AND ELECTRICAL 11.2%
5,000 Advanced Semiconductor* 82,500
2,420 Advantest 121,969
1,800 Alcatel Alsthom* 216,825
21,000 Canon Inc. 449,485
12,000 Ericsson Tel* 423,697
36,300 General Electric 222,623
8,000 Getronics NV* 260,161
22,000 Hitachi Ltd. 195,463
16,400 Logica 258,920
20,000 Matsushita Electric Industrial Corp. 311,772
8,000 Matsushita Electric Works 73,016
3,940 Nokia AB 237,460
4,000 Rohm Co. 294,649
9,400 Samsung Electronics* 62,894
4,750 SGS-Thomson Micro* 333,348
4,600 Sony Corp. 321,384
-----------
3,866,166
-----------
ENERGY 1.8%
4,500 Banpu Co. 67,566
4,100 PTT Exploration and Production* 60,929
14,900 Shell Transport & Trading* 265,576
2,500 Total* 216,265
-----------
610,336
-----------
</TABLE>
See Notes to Financial Statements 25
<PAGE>
INTERNATIONAL EQUITY FUND (CONTINUED)
Statement of Investments
March 31, 1997 (Unaudited)
- ----------------------------------------------
<TABLE>
<CAPTION>
Shares Value
- --------- -----------
FINANCIAL SERVICES 3.8%
<C> <S> <C> <C>
2,410 Cetelem* $ 285,594
54,000 Fomento Econ Mexico* 238,987
8,001 Ing Groep NV* 315,218
53,000 MBF Capital Bhd* 93,632
14,000 Nomura Securities Company Ltd. 154,917
10,500 Trygg-hansa* 210,455
-----------
1,298,803
-----------
FOOD AND SERVICES 3.1%
5,400 Cervecerias Unidas 106,650
10,000 Ceval Alimentos SA* 106,290
315,000 Goodman Fielder Lt 407,404
21,200 Grand Metropolitan 170,919
30,000 H.M. Sampoerna* 140,400
42,000 Morrison Supermarket* 106,549
700 Seita* 25,271
-----------
1,063,483
-----------
FOREST PRODUCTS AND PAPER 0.7%
7,500 Mo Och Domsjo* 232,953
-----------
HEALTH AND PERSONAL CARE 6.8%
5,800 Astra AB Ser B* 272,921
34,500 British Biotech* 141,339
16,000 Glaxo Wellcome 293,327
56,000 Kalbe Farma* 62,899
33,666 Medeva 169,985
275 Novartis AG* 333,485
25 Roche Holding Ag* 215,966
18,000 Sankyo Company 495,766
2,610 Synthelabo* 267,097
5,000 Yamanouchi Pharm. 103,386
-----------
2,356,171
-----------
INDUSTRIAL COMPONENTS 2.0%
31,454 Bicc 139,190
20,000 NSK 106,455
19,000 Sumitomo Electric Industries 257,818
3,350 Valeo* 200,280
-----------
703,743
-----------
INSURANCE 2.4%
11,000 Malaysian Assurance Alliance* 63,446
30,646 Royal & Sun Alliance Insurance Group 224,934
24,000 Tokio Marine & Fire 244,248
970 Zurich Versicherun* 305,014
-----------
837,642
-----------
<CAPTION>
Shares Value
- --------- -----------
<C> <S> <C> <C>
LEISURE 2.2%
1,600 Bic $ 243,048
12,500 Granada Group 188,317
48,000 Magnum Cp Bhd* 90,994
632,000 Regal Hotels Intl. 167,194
2,400 Sony Music Entertainment 87,232
-----------
776,785
-----------
MACHINERY AND ENGINEERING 3.1%
10,800 Cardo AB* 349,072
51,000 Hitachi Zosen Corp. 184,955
22,000 Jurong Shipyard* 99,702
20,000 Kawasaki Heavy Industries 77,701
23,000 Mitsubishi Heavy Industries 149,546
18,000 Umw Hldgs Berhad* 99,464
30,600 Vickers Plc* 121,342
-----------
1,081,782
-----------
MERCHANDISING 5.3%
4,066 Ahold* 283,312
370 Carrefour* 229,487
1,110 Guilbert SA* 207,071
1,500 Hennes & Mauritz* 200,897
10,000 Ito-yokado Co. 444,235
20,000 Makro Atacadista* 267,848
25,500 WH Smith Group 188,210
-----------
1,821,060
-----------
METALS AND MINING 4.8%
13,650 Acos Espec Itabira* 62,101
270,000 Mim Holdings Ltd. 361,902
30,000 Mitsubishi Materials 104,678
160,000 NKK Corp. 336,003
153,000 North Ltd. 497,703
18,000 Usinor Sacilor* 294,217
-----------
1,656,604
-----------
MISC. MATERIALS AND COMMODITIES 1.8%
7,000 De Beers Consolidated Mines 247,625
42,000 Ioi Corp. 69,794
2,260 SGL Carbon AG* 308,171
-----------
625,590
-----------
MULTI INDUSTRY 2.0%
47,000 Hutchison Whampoa 353,301
4,230 Orkla ASA* 340,430
-----------
693,731
-----------
REAL ESTATE 3.1%
37,000 Cheung Kong Holdings 325,878
</TABLE>
See Notes to Financial Statements 26
<PAGE>
INTERNATIONAL EQUITY FUND (CONTINUED)
Statement of Investments
March 31, 1997 (Unaudited)
- ----------------------------------------------
<TABLE>
<CAPTION>
Shares Value
- --------- -----------
49,000 DBS Land* $ 167,480
<C> <S> <C> <C>
67,000 Hong Kong Land Hld 155,440
13,000 Mitsubishi Estate 138,601
13,000 Mitsui Fudosan Co. 134,400
38,000 Wharf Holdings 145,398
-----------
1,067,197
-----------
TELECOMMUNICATIONS 7.3%
44,000 British Telecom 321,865
7,000 Ca Nac Telefonos* 203,875
530 DDI Corp. 334,330
32,883 General Cable* 98,809
3,400 Nippon Tel & Tel Cp 239,192
2,300 Telebras Telec Bra* 235,463
120,600 Telecom Ital Mobile* 346,749
12,000 Telefonica De Espana* 289,073
12,000 Telefonos De Mexico 462,000
-----------
2,531,356
-----------
TRANSPORTATION 1.7%
16,100 British Airways 173,289
132,000 China Travel International* 63,453
2,000 Kobenhavn Lufthave* 207,680
33,000 Tobu Railways Co. 146,064
-----------
590,486
-----------
UTILITIES 5.0%
4,650 Cemig Cia Energ Mg* 192,308
<CAPTION>
Shares Value
- --------- -----------
<C> <S> <C> <C>
10,000 Electrobras Cent El* $ 214,562
55,628 ENI SPA* 282,397
1,240 Gas Natural Sdg SA 270,194
79,000 Hong Kong Electric* 278,828
10,900 Manila Electric Co B 86,819
28,000 Tenaga Nasional* 136,652
4,680 Veba AG* 268,728
-----------
1,730,488
-----------
WHOLESALE INTERNATIONAL TRADE 0.8%
31,000 Mitsubishi Corp. 275,426
-----------
Total Common and Preferred Stocks
(Cost $28,871,188) $33,494,291
-----------
<CAPTION>
Principal
Amount
- ---------
<C> <S> <C> <C>
FIXED INCOME INVESTMENTS 0.3%
$100,000 Yang Ming Marine*
2.00% Convertible Bonds
Due 6/10/2001, cost $117,183 116,000
-----------
Total Investments (Cost $28,988,371) 97.1% $33,610,291
Other Assets, Less Liabilities 2.9% 993,523
------ -----------
Net Assets 100.0% $34,603,814
------ -----------
------ -----------
</TABLE>
*Denotes non-income producing security.
See Notes to Financial Statements 27
<PAGE>
INTERNATIONAL EQUITY FUND (CONTINUED)
Geographical Diversification March 31, 1997 (Unaudited)
---------------------------------------------------------------
<TABLE>
<CAPTION>
Percent of Net Assets
-------------------------------------------------------------------
Country Common and Preferred Stocks Bonds and Notes Total
- ------------------------- ---------------------------------- ------------------- ----------
<S> <C> <C> <C>
Japan 21.8% -- % 21.8%
United Kingdom 13.1 -- 13.1
France 7.3 -- 7.3
Sweden 7.3 -- 7.3
Netherlands 6.5 -- 6.5
Hong Kong 5.7 -- 5.7
Australia 4.9 -- 4.9
Germany 4.3 -- 4.3
Malaysia 3.5 -- 3.5
Brazil 3.1 -- 3.1
Mexico 2.6 -- 2.6
Switzerland 2.5 -- 2.5
Italy 2.3 -- 2.3
Norway 1.7 -- 1.7
Spain 1.6 -- 1.6
Denmark 1.5 -- 1.5
Singapore 1.5 -- 1.5
Indonesia 1.4 -- 1.4
Taiwan 0.5 0.3 0.8
Finland 0.7 -- 0.7
South Africa 0.7 -- 0.7
Philippines 0.6 -- 0.6
Venezuela 0.6 -- 0.6
Thailand 0.4 -- 0.4
South Korea 0.4 -- 0.4
Chile 0.3 -- 0.3
--- --- ---
Total Investments 96.8% 0.3% 97.1%
--- ---
Other Assets Less
Liabilities 2.9%
---
Total 100.0%
---
---
</TABLE>
Statement of Assets and Liabilities March 31, 1997 (Unaudited)
---------------------------------------------------------------
<TABLE>
<S> <C> <C>
ASSETS:
Investments in securities at value (Cost
$28,988,371)--Note 2(A) $33,610,291
Cash 1,017,068
Receivable for units sold 23,681
Dividends and interest receivable 156,012
Other assets 1,387
Net gain on forward foreign currency contracts 57,665
-----------
34,866,104
LIABILITIES:
Payable for investments purchased $163,641
Payable to investment managers 17,600
Accrued expenses 80,746
Other liabilities 303 262,290
------- -----------
NET ASSETS at value, applicable to 750,211
outstanding units of
beneficial interest--Note 5 $34,603,814
-----------
-----------
NET ASSET VALUE offering and redemption price per
unit
($34,603,814 divided by 750,211 units) $ 46.13
-----------
-----------
</TABLE>
See Notes to Financial Statements
28
<PAGE>
INTERNATIONAL EQUITY FUND (CONTINUED)
Statement of Operations Six Months Ended March 31, 1997
(Unaudited)
---------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Income:
Dividends (Net of foreign taxes of $6,833) $188,064
Interest 40,106
-------
Total Income $ 228,170
Expenses:
Investment managers's fees--Note 3(A) 153,184
Shareholder servicing fees and expenses--Note
3(B) 107,929
Custodian fees and expenses 52,942
Legal and auditing fees 15,722
Consultant fees 5,210
Trustees' fees and expenses--Note 3(C) 14,753
Other 28,541
-------
Total expenses 378,281
Less fees paid indirectly--Note 4 (10,340)
-------
Total Expenses 367,941
-----------
INVESTMENT (LOSS)--NET (139,771)
REALIZED GAIN AND UNREALIZED (LOSS) ON
INVESTMENTS--Note 4:
Net realized gain (loss) on:
Investments 1,910,822
Foreign currency transactions (59,793)
-------
1,851,029
-------
Unrealized appreciation (depreciation) on
investments
Investments (1,075,552)
Foreign currency translations of other assets
and liabilities 54,978
-------
(1,020,574)
-------
NET REALIZED GAIN (LOSS) AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS AND FOREIGN CURRENCIES 830,455
-----------
NET INCREASE IN NET ASSETS RESULTING FROM
OPERATIONS $ 690,684
-----------
-----------
</TABLE>
Statement of Changes in Net Assets
---------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months
Ended
3/31/97 Year Ended
(Unaudited) 9/30/96
----------- -----------
<S> <C> <C>
OPERATIONS:
Investment (loss)--net $ (139,771) $ (71,627)
Net realized gain on investments 1,851,029 3,827,368
Unrealized appreciation (depreciation) on investments (1,020,574) 599,795
----------- -----------
Net increase in net assets resulting from operations 690,684 4,355,536
----------- -----------
CAPITAL TRANSACTIONS--Note 5:
Value of units sold 6,619,759 8,808,775
Value of units redeemed (12,308,582) (4,705,939)
----------- -----------
Net increase (decrease) in net assets resulting from
capital transactions (5,688,823) 4,102,836
----------- -----------
Net increase (decrease) (4,998,139) 8,458,372
NET ASSETS at beginning of period 39,601,953 31,143,581
----------- -----------
NET ASSETS at end of period $34,603,814 $39,601,953
----------- -----------
----------- -----------
</TABLE>
See Notes to Financial Statements
29
<PAGE>
ACTIVELY MANAGED BOND FUND
Statement of Investments
March 31, 1997 (Unaudited)
- ----------------------------------------------
<TABLE>
<CAPTION>
Principal
Amount Value
- ----------- ------------
<C> <S> <C> <C>
CORPORATE BONDS 4.3%
FINANCIAL SERVICES
$ 500,000 Beneficial Corp.
Medium Term Note
9.32% Due 8/4/1997 $ 505,865
1,200,000 Ford Motor Co. CMO 1993-a
5.78% Due 1/1/1999 1,183,620
1,125,000 Ford Motor Credit Co.
Medium Term Note
10.35% Due 10/1/1997 1,148,425
500,000 Ford Motor Credit Co.
Medium Term Note Debenture
9.20% Due 5/7/1997 501,451
------------
3,339,361
------------
FOOD AND SERVICES
2,000,000 Pepsico Inc.
Structured Medium Term Note
6.00% Due 3/4/2008 1,836,286
------------
OIL
496,000 Consolidated Natural Gas Sf Db
8.625% Due 12/1/2011 511,208
------------
Total Corporate Bonds (Cost $5,774,442) $ 5,686,855
------------
UNITED STATES GOVERNMENT AND AGENCY
OBLIGATIONS 94.2%
$ 34,854 Collateralized Mortgage Oblig Tr 1
0.00% Due 5/20/2017 $ 26,866
206,833 Collateralized Mortgage Oblig Tr 29
0.00% Due 5/1/2013 150,834
112,104 Collateralized Mortgage Sec Corp.
7.00% Due 6/1/2006 111,924
1,250,000 Federal Farm Credit Bank
8.25% Due 5/1/2007 1,246,943
1,000,000 Federal Farm Credit Bank
Medium Term Note
7.03% Due 2/19/2008 950,398
870,000 Federal Home Loan Bank
7.836% Due 10/30/2006 860,942
1,000,000 Federal Home Loan Bank
7.70% Due 7/12/2010 978,829
1,000,000 Federal Home Loan Bank
7.50% Due 4/11/2006 983,560
1,000,000 Federal Home Loan Bank
7.65% Due 12/5/2011 965,637
<CAPTION>
Principal
Amount Value
- ----------- ------------
<C> <S> <C> <C>
UNITED STATES GOVERNMENT AND AGENCY
OBLIGATIONS (Continued)
$ 550,000 Federal Home Loan Bank
Structured Note
7.35% Due 6/16/2009 $ 550,782
1,096,000 Federal Home Loan Mortgage Corp.
CMO 1534g
6.00% Due 5/15/2022 1,015,784
1,000,000 Federal Home Loan Mortgage Corp.
FHR 1617 H
6.50% Due 10/15/2023 879,781
2,000,000 Federal Home Loan Mortgage Corp.
Remic 19331
7.50% Due 1/15/2023 1,956,352
4,000,000 Federal Home Loan Mortgage Corp.
Remic 1946h
7.60% Due 11/15/2024 4,000,000
854,998 Federal Home Loan Mortgage Corp.
Pool #141001
7.75% Due 9/1/2016 849,004
327,498 Federal Home Loan Mortgage Corp.
Pool #297625
8.50% Due 6/1/2017 338,715
547,599 Federal Home Loan Mortgage Corp.
Pool #533624
8.50% Due 12/1/2007 565,637
435,180 Federal Home Loan Mortgage Corp.
Pool #533625
8.50% Due 12/1/2007 448,997
2,699,000 Federal Home Loan Mortgage Corp.
Remic 1505q
7.00% Due 5/15/2023 2,484,189
1,000,000 Federal Home Loan Mortgage Corp. Note
6.375% Due 3/11/2003 963,191
1,000,000 Federal Home Loan Mortgage Corp
7.09% Due 11/24/2006 964,113
500,000 Federal Home Loan Mortgage Corp
7.13% Due 9/15/2005 485,007
500,000 Federal Home Loan Mortgage Corp.
7.83% Due 8/11/2004 496,196
2,000,000 Federal Home Loan Mortgage Corp.
7.29% Due 4/7/2004 1,972,730
1,500,000 Federal Home Loan Mortgage Corp.
6.84% Due 3/2/2009 1,409,669
1,000,000 Federal Home Loan Mortgage Corp.
6.53% Due 2/23/2006 946,733
</TABLE>
See Notes to Financial Statements 30
<PAGE>
ACTIVELY MANAGED BOND FUND (CONTINUED)
Statement of Investments
March 31, 1997 (Unaudited)
- ----------------------------------------------
<TABLE>
<CAPTION>
Principal
Amount Value
- ----------- ------------
UNITED STATES GOVERNMENT AND AGENCY
OBLIGATIONS (Continued)
<C> <S> <C> <C>
$ 1,000,000 Federal Home Loan Mortgage Corp.
6.59% Due 12/9/2008 $ 934,341
4,000,000 Federal Home Loan Mortgage Corp.
6.355% Due 8/8/2005 3,771,076
1,000,000 Federal Home Loan Mortgage Corp.
8.04% Due 6/3/2011 978,954
1,445,000 Federal Home Loan Mortgage Corp.
6.08% Due 10/29/2008 1,306,867
550,000 Federal Home Loan Mortgage Corp.
7.75% Due 8/22/2006 541,181
500,000 Federal Home Loan Mortgage Corp.
8.25% Due 6/10/2011 492,298
2,000,000 Federal National Mortgage Association
Medium Term Note
6.58% Due 3/1/2006 1,915,896
1,000,000 Federal National Mortgage Association
Medium Term Note
6.25% Due 1/14/2004 953,757
1,000,000 Federal National Mortgage Association
Remic Frn93-251pj
6.50% Due 12/25/2023 922,920
1,000,000 Federal National Mortgage Association
Medium Term Note
6.39% Due 12/9/2003 960,433
1,000,000 Federal National Mortgage Association
Medium Term Note
6.71% Due 2/13/2006 959,849
1,000,000 Federal National Mortgage Association
Medium Term Note
6.77% Due 1/19/2006 964,836
4,000,000 Federal National Mortgage Association
Medium Term Note
7.44% Due 11/6/2006 3,955,788
500,000 Federal National Mortgage Association
Medium Term Note
7.74% Due 10/24/2006 496,038
1,000,000 Federal National Mortgage Association
Medium Term Note
7.29% Due 11/8/2006 977,435
1,000,000 Federal National Mortgage Association
Medium Term Note
7.65% Due 10/6/2006 1,002,520
200,000 Federal National Mortgage Association
Medium Term Note
6.69% Due 2/2/2011 187,780
<CAPTION>
Principal
Amount Value
- ----------- ------------
<C> <S> <C> <C>
UNITED STATES GOVERNMENT AND AGENCY
OBLIGATIONS (Continued)
$ 2,000,000 Federal National Mortgage Association
Medium Term Note
7.84% Due 12/23/2011 $ 1,968,254
1,000,000 Federal National Mortgage Association
Medium Term Note
8.59% Due 2/3/2005 1,014,897
1,000,000 Federal National Mortgage Association
1356k
5.50% Due 5/15/2021 847,636
3,000,000 Federal National Mortgage Association
CMO 1993-32h
6.00% Due 3/25/2023 2,724,780
1,291,000 Federal National Mortgage Association
G93-14j
6.50% Due 3/25/2023 1,170,924
955,749 Federal National Mortgage Association
Remic #1991-47h
7.50% Due 5/25/2006 962,563
803,881 Federal National Mortgage Association
Remic 1992-210 L
7.50% Due 4/25/2022 774,882
938,278 Federal National Mortgage Association
Remic 1993-4m
7.50% Due 3/25/2022 898,251
1,000,000 Federal National Mortgage Association
Remic Fnr 93-226c
6.00% Due 12/25/2023 866,593
670,284 Federal National Mortgage Association
Remic 1994-69 Class CA
7.25% Due 3/25/2023 631,619
3,145,878 Federal National Mortgage Association
Pass Thru Pool #050965
6.50% Due 1/1/2024 2,944,979
717,609 Federal National Mortgage Association
Pool #050987
6.50% Due 2/1/2009 696,108
1,114,697 Federal National Mortgage Association
Pass Thru Pool #239024
7.00% Due 10/1/2023 1,072,783
1,227,343 Federal National Mortgage Association
Pass Thru Pool #50966
7.00% Due 1/1/2024 1,181,193
690,345 Federal National Mortgage Association
Pool #87277
7.50% Due 4/1/2018 692,077
</TABLE>
See Notes to Financial Statements 31
<PAGE>
ACTIVELY MANAGED BOND FUND (CONTINUED)
Statement of Investments
March 31, 1997 (Unaudited)
- ----------------------------------------------
<TABLE>
<CAPTION>
Principal
Amount Value
- ----------- ------------
UNITED STATES GOVERNMENT AND AGENCY
OBLIGATIONS (Continued)
<C> <S> <C> <C>
$ 500,000 Federal National Mortgage Association
FNR 93-61hb
6.75% Due 3/25/2022 $ 477,755
1,000,000 Federal National Mortgage Association Note
7.00% Due 8/12/2002 980,874
439,774 Government National Mortgage Association
Custom #152027
8.00% Due 10/20/2016 447,078
17,819 Government National Mortgage Association
Custom #209105
8.00% Due 3/20/2017 18,121
321,383 Government National Mortgage Association
Jumbo #000675
8.00% Due 12/20/2016 326,721
78,211 Government National Mortgage Association
Jumbo #000710
8.00% Due 2/20/2017 79,535
1,703,592 Government National Mortgage Association
Pass Through
8.00% Due 11/15/2024 1,716,555
859,032 Government National Mortgage Association
Pass Thru Pool #377003
8.00% Due 8/15/2024 865,569
820,608 Government National Mortgage Association
Pass Thru Pool #385850
8.00% Due 8/15/2024 826,852
829,368 Government National Mortgage Association
Pool #354611
7.00% Due 7/15/2023 790,497
2,114 Government National Mortgage Association
Pool #002919
8.00% Due 2/15/2004 2,168
1,959 Government National Mortgage Association
Pool #010855
8.00% Due 7/15/2006 2,014
32,974 Government National Mortgage Association
Pool #011192
7.25% Due 4/15/2006 33,114
16,381 Government National Mortgage Association
Pool #025811
9.00% Due 1/15/2009 17,445
84,276 Government National Mortgage Association
Pool #05214
8.00% Due 7/15/2005 86,555
<CAPTION>
Principal
Amount Value
- ----------- ------------
<C> <S> <C> <C>
UNITED STATES GOVERNMENT AND AGENCY
OBLIGATIONS (Continued)
$ 38,967 Government National Mortgage Association
Pool #1350
6.50% Due 3/15/2002 $ 38,422
207,099 Government National Mortgage Association
Pool #169957
8.50% Due 7/15/2016 215,763
155,630 Government National Mortgage Association
Pool #193256
8.00% Due 3/15/2017 159,027
287,166 Government National Mortgage Association
Pool #196754
8.50% Due 2/15/2017 299,212
138,867 Government National Mortgage Association
Pool #202887
8.00% Due 4/15/2017 141,898
65,598 Government National Mortgage Association
Pool #205624
8.50% Due 3/15/2017 68,350
254,376 Government National Mortgage Association
Pool #213606
8.00% Due 4/15/2017 259,929
13,323 Government National Mortgage Association
Pool #216159
8.00% Due 4/15/2017 13,614
240,159 Government National Mortgage Association
Pool #218150
8.00% Due 6/15/2017 245,402
447,306 Government National Mortgage Association
Pool #226673
9.50% Due 7/15/2017 484,311
12,924 Government National Mortgage Association
Pool #247493
8.00% Due 7/15/2018 13,180
7,641 Government National Mortgage Association
Pool #290013
8.00% Due 4/15/2020 7,766
201,177 Government National Mortgage Association
Pool #290123
8.00% Due 6/15/2020 204,465
157,519 Government National Mortgage Association
Pool #291195
8.00% Due 5/15/2020 160,095
764,046 Government National Mortgage Association
Pool #364979
8.00% Due 4/15/2024 769,859
</TABLE>
See Notes to Financial Statements 32
<PAGE>
ACTIVELY MANAGED BOND FUND (CONTINUED)
Statement of Investments
March 31, 1997 (Unaudited)
- ----------------------------------------------
<TABLE>
<CAPTION>
Principal
Amount Value
- ----------- ------------
UNITED STATES GOVERNMENT AND AGENCY
OBLIGATIONS (Continued)
<C> <S> <C> <C>
$ 807,457 Government National Mortgage Association
Pool #373826
8.00% Due 9/15/2023 $ 816,475
10,020,000 United States Treasury Bonds
9.25% Due 2/15/2016 12,105,413
3,100,000 United States Treasury Notes
8.75% Due 8/15/2000 3,292,780
10,000 United States Treasury Notes
5.50% Due 9/30/1997 9,984
12,000,000 United States Treasury Notes
6.50% Due 5/15/2005 11,673,744
6,800,000 United States Treasury Zero Coupons
0.00% Due 2/15/2006 3,679,676
19,180,000 United States Treasury Zero Coupons
0.00% Due 2/15/2010 7,714,560
1,000,000 United States Treasury Zero Coupons
0.00% Due 2/15/1999 888,869
7,000,000 United States Treasury Zero Coupons
0.00% Due 2/15/2002 5,066,733
<CAPTION>
Principal
Amount Value
- ----------- ------------
<C> <S> <C> <C>
UNITED STATES GOVERNMENT AND AGENCY
OBLIGATIONS (Continued)
$ 5,000,000 United States Treasury Zero Coupons
0.00% Due 5/15/2004 $ 3,077,995
------------
Total United States Government and Agency Obligations
(Cost $125,265,847) $124,450,696
------------
SHORT TERM INVESTMENTS
UNITED STATES GOVERNMENT AND AGENCY
OBLIGATIONS 0.9%
$ 1,250,000 Federal National Mortgage
Association Discount Note
6.50% Due 4/1/1997 $ 1,250,000
------------
Total Investments (Cost $132,290,289) 99.4% $131,387,551
Other Assets, Less Liabilities 0.6% 754,244
------ ------------
Net Assets 100.0% $132,141,795
------ ------------
------ ------------
</TABLE>
See Notes to Financial Statements 33
<PAGE>
ACTIVELY MANAGED BOND FUND (CONTINUED)
Statement of Assets and Liabilities March 31, 1997 (Unaudited)
---------------------------------------------------------------
<TABLE>
<S> <C> <C>
ASSETS:
Investments in securities at value (Cost
$132,290,289)--Note 2(A) $131,387,551
Cash 70,814
Receivable for investments sold 1,200,000
Receivable for units sold 3,581
Dividends and interest receivable 1,528,656
Other assets 10,996
------------
134,201,598
LIABILITIES:
Payable for investments purchased $1,476,537
Payable for units redeemed 457,057
Payable to investment managers 38,249
Accrued expenses 87,960 2,059,803
-------- ------------
NET ASSETS at value, applicable to 4,203,911
outstanding units of beneficial interest--Note 5 $132,141,795
------------
------------
NET ASSET VALUE offering and redemption price per unit
($132,141,795 divided by 4,203,911 units) $ 31.43
------------
------------
</TABLE>
Statement of Operations Six Months Ended March 31, 1997
(Unaudited)
---------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Income:
Interest $ 5,131,639
-----------
Total Income $ 5,131,639
Expenses:
Investment manager's fees--Note 3(A) 244,611
Shareholder servicing fees and expenses--Note 3(B) 271,952
Custodian fees and expenses 16,806
Legal and auditing fees 11,098
Consultant fees 5,211
Trustees' fees and expenses--Note 3(C) 14,753
Other 29,368
-----------
Total Expenses 593,799
-----------
INVESTMENT INCOME--NET 4,537,840
REALIZED GAIN AND UNREALIZED (LOSS) ON INVESTMENTS--Note
4:
Net realized gain on investments 597,854
Unrealized (depreciation) on investments (1,776,776)
-----------
NET REALIZED GAIN AND UNREALIZED (LOSS) ON INVESTMENTS (1,178,922)
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 3,358,918
-----------
-----------
</TABLE>
See Notes to Financial Statements
34
<PAGE>
ACTIVELY MANAGED BOND FUND (CONTINUED)
Statement of Changes in Net Assets
---------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months
Ended
3/31/97 Year Ended
(Unaudited) 9/30/96
------------ ------------
<S> <C> <C>
OPERATIONS:
Investment income--net $ 4,537,840 $ 8,692,376
Net realized gain (loss) on investments 597,854 (15,324)
Unrealized (depreciation) on investments (1,776,776) (2,644,736)
------------ ------------
Net increase in net assets resulting from operations 3,358,918 6,032,316
------------ ------------
CAPITAL TRANSACTIONS--Note 5:
Value of units sold 8,484,082 28,269,160
Value of units redeemed (30,005,483) (24,124,192)
------------ ------------
Net increase (decrease) in net assets resulting from capital
transactions (21,521,401) 4,144,968
------------ ------------
Net increase (decrease) (18,162,483) 10,177,284
NET ASSETS at beginning of period 150,304,278 140,126,994
------------ ------------
NET ASSETS at end of period $132,141,795 $150,304,278
------------ ------------
------------ ------------
</TABLE>
See Notes to Financial Statements
35
<PAGE>
INTERMEDIATE-TERM BOND FUND
Statement of Investments
March 31, 1997 (Unaudited)
- ----------------------------------------------
<TABLE>
<CAPTION>
Principal
Amount Value
- ----------- -----------
<C> <S> <C> <C>
CORPORATE BONDS 3.3%
$ 800,000 Ford Motor Co.CMO 1993-A
5.78% Due 1/1/1999 $ 789,080
1,500,000 New Jersey Bell Telephone Debenture
4.875% Due 11/1/2000 1,401,300
-----------
Total Corporate Bonds (Cost $2,259,608) $ 2,190,380
-----------
UNITED STATES GOVERNMENT AND AGENCY
OBLIGATIONS 94.6%
$ 250,000 Federal Home Loan Bank
7.10% Due 5/7/2001 $ 249,004
2,000,000 Federal Home Loan Bank
6.50% Due 11/19/1999 1,986,964
500,000 Federal Home Loan Bank Structured Note
6.50% Due 3/2/2001 496,101
500,000 Federal Home Loan Bank Structured Note
6.50% Due 5/8/2006 492,169
1,500,000 Federal Home Loan Bank
7.00% Due 4/23/2001 1,491,081
500,000 Federal Home Loan Bank
7.34% Due 9/20/2005 489,969
2,000,000 Federal Home Loan Bank
7.50% Due 4/11/2006 1,967,120
250,000 Federal Home Loan Bank
7.74% Due 5/23/2005 248,116
800,000 Federal Home Loan Bank Structured Note
6.00% Due 4/12/2001 803,710
300,000 Federal Home Loan Bank Structured Note
7.00% Due 11/22/2005 289,865
2,000,000 Federal Home Loan Bank Structured Note
6.50% Due 4/10/2006 1,986,860
2,000,000 Federal Home Loan Bank Notes
6.27% Due 1/14/2004 1,903,166
400,000 Federal Home Loan Mortgage Corp.
Remic Series 32 Class E
7.50% Due 3/25/2005 400,780
640,465 Federal Home Loan Mortgage Corp.
Remic 1680e
6.50% Due 2/15/2024 606,433
2,000,000 Federal Home Loan Mortgage Corp.
Remic 1946h
7.60% Due 11/15/2024 2,000,000
792,257 Federal Home Loan Mortgage Corp.
157 Remic Cmo
8.75% Due 7/15/2000 797,001
<CAPTION>
Principal
Amount Value
- ----------- -----------
<C> <S> <C> <C>
UNITED STATES GOVERNMENT AND AGENCY
OBLIGATIONS (Continued)
$ 1,500,000 Federal Home Loan Mortgage Corp.
CMO 1489g
5.85% Due 10/15/2006 $ 1,441,710
15,287 Federal Home Loan Mortgage Corp.
Pool #200030
9.00% Due 3/1/2001 15,773
44,642 Federal Home Loan Mortgage Corp.
Pool #200034
8.50% Due 5/1/2001 45,719
20,557 Federal Home Loan Mortgage Corp.
Pool #200035
9.00% Due 5/1/2001 21,211
80,453 Federal Home Loan Mortgage Corp.
Pool #200040
9.00% Due 6/1/2001 83,011
69,235 Federal Home Loan Mortgage Corp.
Pool #200070
7.50% Due 4/1/2002 69,263
115,669 Federal Home Loan Mortgage Corp.
Pool #200071
7.50% Due 5/1/2002 115,715
103,127 Federal Home Loan Mortgage Corp.
Pool #212242
7.50% Due 7/1/2001 103,251
26,144 Federal Home Loan Mortgage Corp.
Pool #212719
7.50% Due 8/1/2001 26,175
79,106 Federal Home Loan Mortgage Corp.
Pool #213857
7.50% Due 11/1/2001 79,201
29,564 Federal Home Loan Mortgage Corp.
Pool #214040
7.50% Due 12/1/2001 29,600
96,583 Federal Home Loan Mortgage Corp.
Pool #251478
7.00% Due 12/1/1998 96,080
29,976 Federal Home Loan Mortgage Corp.
Pool #309883
7.00% Due 9/1/1998 28,703
69,725 Federal Home Loan Mortgage Corp.
Pool #320139
8.00% Due 9/1/2001 70,832
343,078 Federal Home Loan Mortgage Corp.
Remic 1406n
8.00% Due 1/15/2022 334,147
</TABLE>
See Notes to Financial Statements 36
<PAGE>
INTERMEDIATE-TERM BOND FUND (CONTINUED)
Statement of Investments
March 31, 1997 (Unaudited)
- ----------------------------------------------
<TABLE>
<CAPTION>
Principal
Amount Value
- ----------- -----------
UNITED STATES GOVERNMENT AND AGENCY
OBLIGATIONS (Continued)
<C> <S> <C> <C>
$ 1,000,000 Federal Home Loan Mortgage Corp.
6.355% Due 8/8/2005 $ 942,769
500,000 Federal Home Loan Mortgage Corp.
7.00% Due 4/18/2001 497,076
1,500,000 Federal Home Loan Mortgage Corp.
6.91% Due 6/20/2005 1,459,295
465,000 Federal Home Loan Mortgage Corp.
7.35% Due 6/1/2005 454,655
1,000,000 Federal Home Loan Mortgage Corp.
7.29% Due 4/7/2004 986,365
660,000 Federal Home Loan Mortgage Corp.
Structured Note
6.70% Due 9/3/2003 637,706
1,000,000 Federal Home Loan Mortgage Corp.
8.15% Due 9/12/2006 996,484
948,234 Federal Home Loan Mortgage Corp.
Gold Remic
7.00% Due 11/15/2005 950,794
1,000,000 Federal Home Loan Mortgage Corp.
CMO 1534 F
6.00% Due 4/15/2020 962,980
1,000,000 Federal National Mortgage Association
Medium Term Note
6.25% Due 1/14/2004 953,757
2,000,000 Federal National Mortgage Association
Medium Term Note
6.38% Due 6/25/2003 1,928,026
1,500,000 Federal National Mortgage Association
Medium Term Note
6.24% Due 1/28/2004 1,417,880
1,000,000 Federal National Mortgage Association
Medium Term Note
6.58% Due 3/1/2006 957,948
300,000 Federal National Mortgage Association
Medium Term Note
7.78% Due 5/22/2006 299,641
2,500,000 Federal National Mortgage Association
Medium Term Note
7.44% Due 11/6/2006 2,472,368
1,000,000 Federal National Mortgage Association
Medium Term Note
7.29% Due 11/8/2006 977,435
500,000 Federal National Mortgage Association
Medium Term Note
7.65% Due 10/6/2006 501,260
<CAPTION>
Principal
Amount Value
- ----------- -----------
<C> <S> <C> <C>
UNITED STATES GOVERNMENT AND AGENCY
OBLIGATIONS (Continued)
$ 500,000 Federal National Mortgage Association
Medium Term Note
6.75% Due 2/3/2006 $ 480,568
1,000,000 Federal National Mortgage Association
CMO 1994-10m
6.50% Due 6/25/2023 930,544
763,635 Federal National Mortgage Association
Remic 1993-194e
5.70% Due 6/25/2008 703,926
1,049,900 Federal National Mortgage Association
Remic
7.00% Due 7/25/2005 1,051,002
2,235,000 Federal National Mortgage Association
CMO 1993-162c
3.00% Due 8/25/2023 2,023,300
447,062 Federal National Mortgage Association
CMO 93-244a
0.00% Due 11/25/2023 417,537
500,000 Federal National Mortgage Association
Remic Fnr1993-167 H
6.35% Due 1/25/2022 471,270
1,000,000 Federal National Mortgage Association
Remic Fnr1993-38v
5.757% Due 8/25/2021 913,740
1,024,274 Federal National Mortgage Association
Remic X-225c
6.25% Due 9/25/2022 928,682
2,000,000 Federal National Mortgage Association
Remic 1995-5e
8.00% Due 10/15/2007 2,017,758
3,526 Federal National Mortgage Association
Pool #31435
8.50% Due 8/1/2001 3,620
717,609 Federal National Mortgage Association
Pool #050987
6.50% Due 2/1/2009 696,108
34,604 Federal National Mortgage Association
Pool #26607
9.00% Due 5/1/2001 35,879
19,619 Federal National Mortgage Association
Pool #26707
9.00% Due 5/1/2001 20,342
84,360 Federal National Mortgage Association
Pool #28645
9.00% Due 6/1/2001 87,467
</TABLE>
See Notes to Financial Statements 37
<PAGE>
INTERMEDIATE-TERM BOND FUND (CONTINUED)
Statement of Investments
March 31, 1997 (Unaudited)
- ----------------------------------------------
<TABLE>
<CAPTION>
Principal
Amount Value
- ----------- -----------
UNITED STATES GOVERNMENT AND AGENCY
OBLIGATIONS (Continued)
<C> <S> <C> <C>
$ 164,554 Federal National Mortgage Association
Pool #28785
9.00% Due 6/1/2001 $ 170,616
32,534 Federal National Mortgage Association
Pool #29470
9.00% Due 7/1/2001 33,732
6,901 Federal National Mortgage Association
Pool #29658
8.50% Due 7/1/2001 7,086
75,587 Federal National Mortgage Association
Pool #30409
8.50% Due 9/1/2001 77,617
135,225 Federal National Mortgage Association
Pool #46609
8.00% Due 5/1/2002 137,872
229,179 Federal National Mortgage Association
Pool #46872
8.00% Due 5/1/2002 233,270
14,885 Federal National Mortgage Association
Pool #47137
8.00% Due 5/1/2002 15,176
143,647 Federal National Mortgage Association
Pool #47402
8.00% Due 5/1/2002 146,459
141,627 Federal National Mortgage Association
Pool #47932
8.00% Due 5/1/2002 144,400
94,278 Federal National Mortgage Association
Pool #48103
8.00% Due 5/1/2002 96,124
29,161 Federal National Mortgage Association
Pool #7242
8.50% Due 7/1/2001 29,944
1,090,612 Federal National Mortgage Association
Pool #82407
9.00% Due 3/1/2004 1,136,242
<CAPTION>
Principal
Amount Value
- ----------- -----------
<C> <S> <C> <C>
UNITED STATES GOVERNMENT AND AGENCY
OBLIGATIONS (Continued)
$ 383,525 Federal National Mortgage Association
Pool #87277
7.50% Due 4/1/2018 $ 384,487
1,000,000 Federal National Mortgage Association Note
7.00% Due 8/12/2002 980,874
829,368 Government National Mortgage Association
Pool #354611
7.00% Due 7/15/2023 790,497
10,000 United States Treasury Bonds
3.50% Due 11/15/1998 9,922
3,000,000 United States Treasury Notes
7.875% Due 11/15/1999 3,092,810
3,000,000 United States Treasury Zero Coupons
0.00% Due 2/15/2000 2,490,387
4,000,000 United States Treasury Zero Coupons
0.00% Due 2/15/1999 3,555,476
4,000,000 United States Treasury Zero Coupons
0.00% Due 8/15/2002 2,795,076
-----------
Total United States Government and Agency Obligations
(Cost $63,421,325) $63,274,979
-----------
SHORT TERM INVESTMENTS
UNITED STATES GOVERNMENT AND AGENCY
OBLIGATIONS 1.1%
$ 750,000 Federal National Mortgage Association Discount Note
6.50% Due 4/1/1997 $ 750,000
-----------
Total Investments (Cost $66,430,933) 99.0% $66,215,359
Other Assets, Less Liabilities 1.0% 662,646
----- -----------
Net Assets 100.0% $66,878,005
----- -----------
----- -----------
</TABLE>
See Notes to Financial Statements 38
<PAGE>
INTERMEDIATE-TERM BOND FUND (CONTINUED)
Statement of Assets and Liabilities March 31, 1997 (Unaudited)
---------------------------------------------------------------
<TABLE>
<S> <C> <C>
ASSETS:
Investments in securities at value (Cost
$66,430,933)--Note 2(A) $66,215,359
Cash 53,867
Dividends and interest receivable 900,517
Other assets 6,374
-----------
67,176,117
LIABILITIES:
Payable for units redeemed $207,605
Payable to investment managers 21,376
Accrued expenses 69,131 298,112
-------- -----------
NET ASSETS at value, applicable to 2,228,465 outstanding
units of
beneficial interest--Note 5 $66,878,005
-----------
-----------
NET ASSET VALUE offering and redemption price per unit
($66,878,005 divided by 2,228,465 units) $ 30.01
-----------
-----------
</TABLE>
Statement of Operations Six Months Ended March 31, 1997
(Unaudited)
---------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Income:
Interest $2,505,995
----------
Total Income $2,505,995
Expenses:
Investment manager's fees--Note 3(A) 134,659
Shareholder servicing fees and expenses--Note 3(B) 183,268
Custodian fees and expenses 10,817
Legal and auditing fees 9,702
Consultant fees 5,211
Trustees' fees and expenses--Note 3(C) 14,753
Other 22,556
----------
Total Expenses 380,966
----------
INVESTMENT INCOME--NET 2,125,029
REALIZED GAIN AND UNREALIZED (LOSS) ON INVESTMENTS--Note
4:
Net realized gain on investments 640,595
Unrealized (depreciation) on investments (946,254)
----------
NET REALIZED GAIN AND UNREALIZED (LOSS) ON INVESTMENTS (305,659)
----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $1,819,370
----------
----------
</TABLE>
See Notes to Financial Statements
39
<PAGE>
INTERMEDIATE-TERM BOND FUND (CONTINUED)
Statement of Changes in Net Assets
---------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months
Ended
3/31/97 Year Ended
(Unaudited) 9/30/96
----------- -----------
<S> <C> <C>
OPERATIONS:
Investment income--net $ 2,125,029 $ 5,119,618
Net realized gain on investments 640,595 672,005
Unrealized (depreciation) on investments (946,254) (2,099,642)
----------- -----------
Net increase in net assets resulting from operations 1,819,370 3,691,981
----------- -----------
CAPITAL TRANSACTIONS--Note 5:
Value of units sold 4,653,735 8,291,530
Value of units redeemed (14,349,060) (27,711,540)
----------- -----------
Net (decrease) in net assets resulting from capital transactions (9,695,325) (19,420,010)
----------- -----------
Net (decrease) (7,875,955) (15,728,029)
NET ASSETS at beginning of period 74,753,960 90,481,989
----------- -----------
NET ASSETS at end of period $66,878,005 $74,753,960
----------- -----------
----------- -----------
</TABLE>
See Notes to Financial Statements
40
<PAGE>
SHORT-TERM INVESTMENT FUND
Statement of Investments
March 31, 1997 (Unaudited)
- ----------------------------------------------
<TABLE>
<CAPTION>
Principal
Amount Value
- ---------- -----------
<C> <S> <C> <C>
COMMERCIAL PAPER 5.9%
$ 500,000 General Electric Capital Corp.
5.34% Due 6/10/1997 $ 493,160
1,000,000 Pitney Bowes
5.26% Due 4/3/1997 999,708
-----------
Total Commercial Paper (Cost $1,494,516) $ 1,492,868
-----------
CORPORATE NOTES 0.6%
$ 75,000 H.J. Heinz Co.
5.50% Due 9/15/1997 $ 74,861
23,000 Wal-Mart Stores
5.50% Due 3/1/1998 22,851
50,000 Wal-Mart Stores
5.50% Due 9/15/1997 49,876
-----------
Total Corporate Notes (Cost $147,644) $ 147,588
-----------
UNITED STATES GOVERNMENT AND AGENCY
OBLIGATIONS 93.5%
$ 500,000 Federal Farm Credit Bank
5.73% Due 2/3/1998 $ 498,711
1,000,000 Federal Home Loan Bank
5.685% Due 11/20/1997 998,558
500,000 Federal Home Loan Bank Discount Note
5.16% Due 5/16/1997 496,775
250,000 Federal Home Loan Bank
5.61% Due 1/26/1998 249,032
400,000 Federal Home Loan Bank
5.49% Due 1/16/1998 398,218
850,000 Federal Home Loan Bank
6.00% Due 8/25/1998 845,657
200,000 Federal Home Loan Bank
5.11% Due 2/23/1998 198,176
100,000 Federal Home Loan Bank
6.375% Due 3/24/1999 99,695
1,000,000 Federal Home Loan Mortgage Corp.
Discount Note
5.42% Due 6/3/1997 990,374
150,000 Federal Home Loan Mortgage Corp. Note
5.20% Due 8/4/1997 149,770
<CAPTION>
Principal
Amount Value
- ---------- -----------
<C> <S> <C> <C>
UNITED STATES GOVERNMENT AND AGENCY
OBLIGATIONS (Continued)
$ 500,000 Federal Home Loan Mortgage Corp.
5.47% Due 4/1/1997 $ 500,000
100,000 Federal Home Loan Mortgage Corp.
5.31% Due 4/29/1998 98,991
16,200,000 Federal National Mortgage Association
Discount Note
6.50% Due 4/1/1997 16,200,000
30,000 Federal National Mortgage Association
5.35% Due 10/10/1997 29,932
200,000 Federal National Mortgage Association
5.30% Due 3/11/1998 198,348
300,000 Federal National Mortgage Association
Medium Term Note
5.53% Due 12/16/1997 299,251
100,000 Federal National Mortgage Association
Medium Term Note
5.20% Due 4/20/1998 98,981
500,000 Federal National Mortgage Association
Medium Term Note
5.40% Due 3/18/1998 496,655
300,000 Federal National Mortgage Association
Medium Term Note
5.25% Due 4/22/1998 297,182
200,000 Federal National Mortgage Association
Medium Term Note
5.65% Due 10/20/1997 199,903
500,000 Federal National Mortgage Association
Medium Term Note
5.62% Due 2/23/1998 498,065
-----------
Total United States Government and Agency
Obligations (Cost $23,856,218) $23,842,274
-----------
Total Investments (Cost $25,498,378) 99.9% $25,482,730
Other Assets, Less Liabilities 0.1% 25,252
----- -----------
Net Assets 100.0% $25,507,982
----- -----------
----- -----------
</TABLE>
See Notes to Financial Statements 41
<PAGE>
SHORT-TERM INVESTMENT FUND (CONTINUED)
Statement of Assets and Liabilities March 31, 1997 (Unaudited)
---------------------------------------------------------------
<TABLE>
<S> <C> <C>
ASSETS:
Investments in securities at value (Cost
$25,498,378)--Note 2(A) $25,482,730
Cash 62,342
Dividends and interest receivable 84,753
Other assets 14,308
-----------
25,644,133
LIABILITIES:
Payable for investments purchased $74,976
Payable for units redeemed 3,955
Payable to investment managers 5,387
Accrued expenses 51,833 136,151
-------- -----------
NET ASSETS at value, applicable to 1,232,149 outstanding
units of
beneficial interest--Note 5 $25,507,982
-----------
-----------
NET ASSET VALUE offering and redemption price per unit
($25,507,982 divided by 1,232,149 units) $ 20.70
-----------
-----------
</TABLE>
Statement of Operations Six Months Ended March 31, 1997
(Unaudited)
---------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Income:
Interest $ 692,025
---------
Total Income $ 692,025
Expenses:
Investment manager's fees--Note 3(A) 32,239
Shareholder servicing fees and expenses--Note 3(B) 76,927
Custodian fees and expenses 5,826
Legal and auditing fees 8,854
Consultant fees 5,211
Trustees' fees and expenses--Note 3(C) 14,753
Other 18,648
---------
Total Expenses 162,458
Less expense reimbursement--Note 3(A) (59,292)
---------
Net Expenses 103,166
---------
INVESTMENT INCOME--NET 588,859
REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS--Note 4:
Realized gain on investments --
Unrealized (depreciation) on investments (10,102)
---------
NET REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS (10,102)
---------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 578,757
---------
---------
</TABLE>
See Notes to Financial Statements
42
<PAGE>
SHORT-TERM INVESTMENT FUND (CONTINUED)
Statement of Changes in Net Assets
---------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months
Ended
3/31/97 Year Ended
(Unaudited) 9/30/96
----------- -----------
<S> <C> <C>
OPERATIONS:
Investment income--net $ 588,859 $ 1,273,516
Net realized gain on investments -- --
Unrealized (depreciation) on investments (10,102) (12,603)
----------- -----------
Net increase in net assets resulting from operations 578,757 1,260,913
----------- -----------
CAPITAL TRANSACTIONS--Note 5:
Value of units sold 11,294,950 11,983,285
Value of units redeemed (12,033,812) (14,936,022)
----------- -----------
Net (decrease) in net assets resulting from capital transactions (738,862) (2,952,737)
----------- -----------
Net (decrease) (160,105) (1,691,824)
NET ASSETS at beginning of period 25,668,087 27,359,911
----------- -----------
NET ASSETS at end of period $25,507,982 $25,668,087
----------- -----------
----------- -----------
</TABLE>
See Notes to Financial Statements
43
<PAGE>
NOTES TO FINANCIAL STATEMENTS
NOTE 1--GENERAL
Participation in RSI Retirement Trust ("RSI") is limited to
IRA's and trusts established by eligible employers, which
include banks, savings banks, credit unions, savings and loan
associations and other organizations determined by the Trustees
of RSI to have business interests in common with organizations
participating in RSI. Such trusts are exempt from taxation
under Section 501(a) of the Internal Revenue Code ("Code") and
have been established under pension or profit sharing plans
which are qualified under Section 401 of the Code
("Participating Plans").
In order to provide investment products to Participating
Plans, RSI operates, pursuant to an Agreement and Declaration
of Trust amended effective as of August 31, 1984 ("Trust
Agreement"), as a series fund currently issuing as of March 31,
1997 seven classes of units of beneficial interest: Core Equity
Fund, Emerging Growth Equity Fund, Value Equity Fund,
International Equity Fund, Actively Managed Bond Fund,
Intermediate-Term Bond Fund and Short-Term Investment Fund
("Investment Funds"). The Trust Agreement was amended in 1984
to provide for the continued operation of RSI as an open-end
management investment company under the Investment Company Act
of 1940 ("Act"). Retirement System Distributors Inc.
("Distributors") acts as the distributor of the Investment
Funds' units of beneficial interest. The Distributor is a
wholly owned subsidiary of Retirement System Group Inc.
("Group").
On April 24, 1992, the remaining unitholders of RSI's
Dedicated Bond Fund sold their units and the proceeds were used
to purchase units in other RSI fixed-income funds. The
Dedicated Bond Fund has been inactive subsequent to this date,
but may be reactivated again, should a number of clients elect
to "immunize" their retiree liabilities. The financial
highlights of the Dedicated Bond Fund are presented for the
period from October 1, 1991 through April 24, 1992, the date on
which all of its units were redeemed.
The financial statements of the Investment Funds are
presented on a combined and individual basis. The combined
financial statements should be read in conjunction with the
individual financial statements.
NOTE 2--SIGNIFICANT ACCOUNTING POLICIES
(A) SECURITIES VALUATION: Except for debt securities with
remaining maturities of 60 days or less, investments for
which market prices are available are valued as follows:
(1)each listed security is valued at its closing price
obtained from the respective exchange on which the
security is listed, or, if there were no sales on that
day, at its last reported closing or bid price. For
international securities other than those traded on Far
East markets, the last recorded
44
<PAGE>
prices at the close of business on the New York Stock
Exchange are used to price the holdings. For securities
traded in the Far East markets, the closing prices are
used to value the securities.
(2)each unlisted security quoted on the NASDAQ is valued at
the last current bid price obtained from the NASDAQ;
(3)United States Government and agency obligations and
certain other debt obligations are valued based upon bid
quotations from various market makers for identical or
similar obligations.
(4)mortgage-backed securities and asset-backed securities
are valued with a cash flow model based on both the
pre-payment assumptions (Public Securities Association
median) and the price-yield spreads over comparable
United States Treasury Securities.
(5)short-term money market instruments (such as
certificates of deposit, bankers' acceptances and
commercial paper) are valued by bid quotations or by
reference to bid quotations of available yields for
similar instruments of issuers with similar credit
rating.
Debt securities with remaining maturities of 60 days or
less are valued on the basis of amortized cost. In the absence
of an ascertainable market value, investments are valued at
their fair value as determined by the officers of RSI using
methods and procedures reviewed and approved by RSI's Trustees.
Investments and other assets and liabilities denominated in
foreign currencies are translated to US. dollars at the
prevailing rates of exchange. It is not practical to isolate
that portion of income arising from changes in the exchange
rates from the portion arising from changes in the market
prices of securities.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities
transactions are recorded on a trade date basis. Realized
gain and loss from securities transactions are recorded on
a specific cost basis. Dividend income is recognized on the
ex-dividend date or when the dividend information is known;
interest income, including, where applicable, amortization
of discount and premium on investments and zero coupon
bonds, is recognized on an accrual basis.
The Investment Funds may enter into repurchase agreements
with financial institutions, deemed to be creditworthy by
the Investment Funds' Manager, subject to the sellers'
agreement to repurchase and the Funds' agreement to resell
such securities at a mutually agreed upon price. Securities
purchased subject to repurchase agreements are deposited
with the Investment Funds' custodian and, pursuant to the
terms of the repurchase agreement, must have an aggregate
market value greater than or equal to the repurchase price
plus accrued interest at all times. If the value of the
underlying securities falls below the value of the
repurchase price plus accrued interest, the Investment
Funds will require the seller to deposit additional
collateral by the next business day. If the request for
additional collateral is not met, or the seller defaults on
its
45
<PAGE>
repurchase obligation, the Investment Funds maintain the
right to sell the underlying securities at market value and
may claim any resulting loss against the seller.
The Investment Funds may write call options on equity
securities. Premiums received for call options written are
recorded as a liability and "marked to market" daily to
reflect the current value of the option written. If the
written option is exercised prior to expiration, the
premium received is treated as a realized gain. If the
written option is exercised, the premium received is added
to the sale proceeds of the underlying security.
(C) DIVIDENDS TO UNITHOLDERS: RSI does not normally declare
nor pay dividends on its net investment income or capital
gains.
(D) FEDERAL INCOME TAXES: RSI has received a determination
letter from the Internal Revenue Service stating that it is
exempt from taxation under Section 501(a) of the Internal
Revenue Code with respect to funds derived from
Participating Plans which are pension or profit sharing
trusts maintained in conformity with Section 401 of the
Code.
(E) ACCOUNTING 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 liabilities at the
date of the financial statements and the reported amounts
of increase and decrease in net assets from operations
during the period. Actual results could differ from those
estimates.
(F) OTHER: RSI accounts separately for the assets, liabilities
and operations of each Investment Fund. Expenses directly
attributed to each Investment Fund are charged to that
Investment Fund's operations; expenses which are applicable
to all Investment Funds are allocated among them.
Administrative expenses incurred by RSI relating to the
administration of Plans of Participation are charged to
Full Participation Employers (as defined in the Trust
Agreement) and are not included in the operation of the
Investment funds.
The Investment Funds may enter into financial futures
contracts which require initial margin deposits of cash or
U.S. Government securities equal to approximately 10% of
the value of the contract. During the period the financial
futures are open, changes in the value of the contracts are
recognized by "marking to market" on a daily basis to
reflect the market value of the contracts at the close of
each day's trading. Accordingly, variation margin payments
are made or received to reflect daily unrealized gains or
losses. The Investment Fund is exposed to market risk as a
result of movements in securities, values and interest
rates.
46
<PAGE>
NOTE 3--INVESTMENT MANAGERS' FEES AND OTHER TRANSACTIONS WITH
AFFILIATES
(A) Retirement System Investors Inc. ("Investors") is the
Investment Advisor for each Investment Fund. Investors has
retained sub-advisors to manage the International Equity
Fund and the Emerging Growth Equity Fund. Investors acts as
Investment Manager to the remaining Trust Investment Funds,
and in the case of all Investment Funds, exercises general
oversight with respect to the portfolio management,
including reporting of manager performance to the Trustees
and Investment Committee, compliance matters, sub-advisory
portfolio analysis, and presentations to unitholders. Prior
to April 1, 1995, NFJ Investment Group was the sub-advisor
of the Value Equity Fund.
Beginning April 1, 1997, HLM Management Company, Inc.
became one of the two sub-advisors to the Emerging Growth
Equity Fund, replacing the Putnam Advisory Company, Inc.
Friess Associates, Inc. continues to be the other sub-
advisor to the Emerging Growth Equity Fund.
Fees incurred by Investors pursuant to the provisions of
its investment management contracts are payable monthly to
Investors and quarterly to all sub-advisors and are
computed based on the value of the net assets of each
Investment Fund determined on a monthly or quarterly bases
as appropriate at the rates listed in the following table.
<TABLE>
<CAPTION>
INVESTMENT FUND INVESTMENT MANAGER FEE
- ----------------------- ------------------------------------- ------------------------------
<S> <C> <C>
Core Equity Fund Retirement System Investors Inc. .60% on first $50 million
.50% on next $150 million,
and .40% over $200 million
Value Equity Fund Retirement System Investors Inc. .60% on first $10 million,
.50% on next $10 million,
.40% on next $20 million,
.30% on next $20 million,
.20% on next $40 million,
.15% on next $50 million,
and .10% over $150 million
Emerging Growth Friess Associates, Inc. 1.00%
Equity Fund (Sub-adviser)
The Putnam Advisory 1.00% on first $25 million,
Company, Inc. and .75% over $25 million
(Sub-adviser until 3/31/97)
HLM Management Company, Inc. same fee structure
(Sub-adviser, commencing 4/1/97)
</TABLE>
47
<PAGE>
<TABLE>
<CAPTION>
INVESTMENT FUND INVESTMENT MANAGER FEE
- ----------------------- ------------------------------------- ------------------------------
<S> <C> <C>
International Morgan Grenfell Investment .60% on first $50 million,
Equity Fund Services Limited (Sub-adviser) and .50% over $50 million
Actively Managed Bond Retirement System Investors Inc. .40% on first $50 million,
Fund .30% on next $100 million,
and .20% over $150 million
Intermediate-Term Bond Retirement System Investors Inc. .40% on first $50 million,
Fund .30% on next $100 million,
and .20% over $150 million
Short-Term Retirement System Investors Inc. .25 on first $50 million,
Investment Fund and .20% over $50 million
</TABLE>
RSI's investment management agreement with Investors
provides for RSI to receive a management fee of 0.20% per
annum of the average daily net assets of the Investment
Funds that employ a sub-advisor. For the period ended March
31, 1997, Investors has voluntarily waived a portion of its
investment manager's fee from the Short-Term Investment
Fund amounting to $59,292, to limit the Fund's annual
expenses to 0.80% of average net assets.
(B) Shareholder servicing fees and expenses for the period
ended March 31, 1997 consist of fees paid to Retirement
System Consultants Inc., (a subsidiary of Group) under a
contract for providing administrative services for the
Investment Funds. The fee arrangement applicable for each
of the investment funds is as follows:
<TABLE>
<CAPTION>
AVERAGE NET ASSETS FEE
- --------------------------------- ---------
<S> <C>
First $25 million .60%
Next $25 million .50%
Next $25 million .40%
Next $25 million 30%
Over $100 million .20%
</TABLE>
(C) Each Trustee who is not an officer of RSI receives an
annual fee of $9,500 and a fee of $950 per meeting
attended, except that such fee is $400 for a telephonic
meeting. Such Trustees also participate in a deferred
compensation plan which permits each Trustee to defer
payment of a portion of their fees. A Trustee and several
officers of RSI are also officers of Group and its
subsidiaries.
48
<PAGE>
NOTE 4--SECURITIES TRANSACTIONS
The following summarizes the securities transactions, other
than short-term securities, by the various Investment Funds for
the period ended March 31, 1997:
<TABLE>
<CAPTION>
PURCHASES SALES
-------------- --------------
<S> <C> <C>
Core Equity Fund $ 9,391,220 $ 38,926,745
Value Equity Fund 33,253,203 49,785,676
Emerging Growth Equity Fund 57,645,512 72,983,484
International Equity Fund 12,692,600 19,164,005
Actively Managed Bond Fund 32,706,293 49,425,091
Intermediate-Term Bond Fund 25,623,676 29,969,455
</TABLE>
Net unrealized appreciation (depreciation) consisting of
gross unrealized appreciation and gross unrealized depreciation
at March 31, 1997 for each of the Investment Funds was as
follows:
<TABLE>
<CAPTION>
NET UNREALIZED GROSS GROSS
APPRECIATION UNREALIZED UNREALIZED
(DEPRECIATION) APPRECIATION DEPRECIATION
---------------- ---------------- -------------
<S> <C> <C> <C>
Core Equity Fund $ 108,850,369 $ 109,719,857 $ (869,490)
Value Equity Fund 6,896,853 7,533,514 (636,661)
Emerging Growth Equity Fund 9,889,243 14,382,211 (4,492,968)
International Equity Fund 4,621,920 6,206,118 (1,584,198)
Actively Managed Bond Fund (902,738) 1,115,257 (2,017,995)
Intermediate-Term Bond Fund (215,574) 503,506 (719,080)
Short-Term Investment Fund (15,648) 324 (15,972)
</TABLE>
As of March 31, 1997, the International Equity Fund has
outstanding forward currency contracts as set forth below.
These contracts are reported in the financial statements at the
Fund's net gain of $57,665, which is the difference between the
forward foreign exchange rate at the dates of entry into the
contracts and the forward rates at March 31, 1997.
<TABLE>
<CAPTION>
CONTRACTS TO SELL
----------------------------------------------------------
<C> <S> <C>
2,045,000 German Marks for U.S. $1,253,079 4/24/97 30,251
6,915,000 French Francs for U.S.$1,256,071 4/24/97 27,414
---------
$ 57,665
---------
---------
</TABLE>
49
<PAGE>
The following summarizes the market value of securities
that were on loan to brokers and the value of securities and
cash held as collateral for these loans at March 31, 1997:
<TABLE>
<CAPTION>
VALUE OF
SECURITIES VALUE OF
LOANED COLLATERAL
-------------- --------------
<S> <C> <C>
Core Equity Fund $ 4,059,631 $ 4,141,908
Value Equity Fund 1,653,452 1,686,594
Emerging Growth Equity Fund 23,857,470 24,336,723
International Equity Fund 2,365,301 2,539,565
Actively Managed Bond Fund 27,478,074 28,151,549
Intermediate Term Bond Fund 6,880,420 7,085,300
</TABLE>
These securities lending arrangements may result in
significant credit exposure in the event the counterparty to
the transaction was unable to fulfill its contractual
obligations. In accordance with industry practice, the
securities lending agreements are generally collaterized by
cash or securities with a market value in excess of the
Investment Funds obligation under the contract. The Investment
Funds attempt to minimize credit risk associated with these
activities by monitoring broker credit exposure and collateral
values on a daily basis and requiring additional collateral to
be deposited with or returned to the Investment Funds when
deemed necessary.
For the period ended March 31, 1997 the Emerging Growth
Equity Fund and the International Equity Fund each had expenses
paid through brokerage/service arrangements which amounted to
$15,260 and $10,340 respectively.
50
<PAGE>
NOTE 5--CAPITAL TRANSACTIONS:
At March 31, 1997 there were an unlimited number of units
of beneficial interest authorized for each Investment Fund.
Transactions in the units of beneficial interest of each
Investment Fund for the period ended March 31, 1997 were as
follows:
<TABLE>
<CAPTION>
Core Equity Value Equity
Fund Fund
----------------------- -----------------------
Units Amount Units Amount
--------- ------------ --------- ------------
<S> <C> <C> <C> <C>
Units sold 63,271 $ 3,994,873 49,357 $ 2,206,788
Units redeemed (658,175) (41,667,798) (229,668) (10,432,546)
--------- ------------ --------- ------------
Net (decrease) (594,904) $(37,672,925) (180,311) $ (8,225,758)
--------- ------------ --------- ------------
--------- ------------ --------- ------------
</TABLE>
<TABLE>
<CAPTION>
Emerging Growth International
Equity Fund Equity Fund
----------------------- -----------------------
Units Amount Units Amount
--------- ------------ --------- ------------
<S> <C> <C> <C> <C>
Units sold 92,567 $ 6,180,405 145,037 $ 6,619,759
Units redeemed (247,141) (16,932,411) (270,079) (12,308,582)
--------- ------------ --------- ------------
Net (decrease) (154,574) $(10,752,006) (125,042) $ (5,688,823)
--------- ------------ --------- ------------
--------- ------------ --------- ------------
</TABLE>
<TABLE>
<CAPTION>
Actively Managed Intermediate-Term
Bond Fund Bond Fund
----------------------- -----------------------
Units Amount Units Amount
--------- ------------ --------- ------------
<S> <C> <C> <C> <C>
Units sold 268,043 $ 8,484,082 155,455 $ 4,653,735
Units redeemed (946,363) (30,005,483) (477,971) (14,349,060)
--------- ------------ --------- ------------
Net (decrease) (678,320) $(21,521,401) (322,516) $ (9,695,325)
--------- ------------ --------- ------------
--------- ------------ --------- ------------
</TABLE>
<TABLE>
<CAPTION>
Short-Term
Investment Fund
-----------------------
Units Amount
--------- ------------
<S> <C> <C>
Units sold 552,460 $ 11,294,950
Units redeemed (588,209) (12,033,812)
--------- ------------
Net (decrease) (35,749) $ (738,862)
--------- ------------
--------- ------------
</TABLE>
51
<PAGE>
Transactions in the units of beneficial interest of each
Investment Fund for the year ended September 30, 1996 were as
follows:
<TABLE>
<CAPTION>
Core Equity Value Equity
Fund Fund
----------------------- ----------------------
Units Amount Units Amount
--------- ------------ --------- -----------
<S> <C> <C> <C> <C>
Units sold 338,372 $ 17,141,226 171,011 $ 6,089,364
Units redeemed (562,143) (28,996,541) (197,341) (7,173,870)
--------- ------------ --------- -----------
Net (decrease) (223,771) $(11,855,315) (26,330) $(1,084,506)
--------- ------------ --------- -----------
--------- ------------ --------- -----------
</TABLE>
<TABLE>
<CAPTION>
Emerging Growth International
Equity Fund Equity Fund
----------------------- ----------------------
Units Amount Units Amount
--------- ------------ --------- -----------
<S> <C> <C> <C> <C>
Units sold 182,662 $ 10,600,409 209,851 $ 8,808,775
Units redeemed (228,340) (13,437,810) (108,338) (4,705,939)
--------- ------------ --------- -----------
Net increase
(decrease) (45,678) $ (2,837,401) 101,513 $ 4,102,836
--------- ------------ --------- -----------
--------- ------------ --------- -----------
</TABLE>
<TABLE>
<CAPTION>
Actively Managed Intermediate-Term
Bond Fund Bond Fund
----------------------- -----------------------
Units Amount Units Amount
--------- ------------ --------- ------------
<S> <C> <C> <C> <C>
Units sold 942,767 $ 28,269,160 289,856 $ 8,291,530
Units redeemed (797,462) (24,124,192) (969,774) (27,711,540)
--------- ------------ --------- ------------
Net increase
(decrease) 145,305 $ 4,144,968 (679,918) $(19,420,010)
--------- ------------ --------- ------------
--------- ------------ --------- ------------
</TABLE>
<TABLE>
<CAPTION>
Short-Term
Investment Fund
-----------------------
Units Amount
--------- ------------
<S> <C> <C>
Units sold 608,462 $ 11,983,285
Units redeemed (757,202) (14,936,022)
--------- ------------
Net (decrease) (148,740) $ (2,952,737)
--------- ------------
--------- ------------
</TABLE>
52
<PAGE>
Net Assets at March 31, 1997 are comprised as follows:
<TABLE>
<CAPTION>
Emerging
Core Equity Growth Value Equity International
Fund Equity Fund Fund Equity Fund
------------ ------------ ------------ -----------
<S> <C> <C> <C> <C>
Paid-in capital (deficit) $(68,229,696) $(25,235,224) $(28,897,470) $(2,006,384)
Accumulated income 132,204,248 81,832,143 63,852,731 30,082,853
Accumulated realized gain 23,905,233 8,249,687 9,007,416 1,905,425
Unrealized appreciation 108,850,368 9,889,243 6,896,853 4,621,920
------------ ------------ ------------ -----------
$196,730,153 $ 74,735,849 $ 50,859,530 $34,603,814
------------ ------------ ------------ -----------
------------ ------------ ------------ -----------
</TABLE>
<TABLE>
<CAPTION>
Short-Term Actively
Investment Intermediate-Term Managed
Fund Bond Fund Bond Fund
-------------- ---------------
<S> <C> <C> <C>
Paid-in capital (deficit) $(16,068,065) $ (68,703,217) $(52,195,011)
Accumulated income 41,591,695 135,156,201 184,641,690
Accumulated realized gain 0 640,595 597,854
Unrealized (depreciation) (15,648) (215,574) (902,738)
-------------- --------------- ------------
$ 25,507,982 $ 66,878,005 $132,141,795
-------------- --------------- ------------
-------------- --------------- ------------
</TABLE>
53
<PAGE>
NOTE 6--FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK
The Investment Funds activity during the year in writing
equity call options had off-balance sheet risk of accounting
loss. These financial instruments involve market risk in excess
of the amount recognized in the Statement of Assets and
Liabilities. A written equity call option obligates the
Investment Funds to deliver the underlying security upon
exercise by the holder of the option. The Investment Funds
cover options written by owning the underlying security.
A summary of the Investment Funds option transactions
written for the period ended March 31, 1997 follows:
<TABLE>
<CAPTION>
Number of
Options Premiums
Contracts Received
------------- ---------
<S> <C> <C>
Contracts outstanding at September 30, 1996 380 72,005
Options written 130 $ 53,245
Options exercised (11) (8,521)
Options expired (410) (79,353)
Contracts outstanding at March 31, 1997 89 $ 37,376
</TABLE>
54
<PAGE>
NOTE 7--FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CORE EQUITY FUND
--------------------------------------------------------------
Six
Months Year Year Year Year Year
Ended Ended Ended Ended Ended Ended
3/31/97 9/30/96 9/30/95 9/30/94 9/30/93 9/30/92
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Per Unit Operating Performance:*
(for a unit outstanding
throughout the period)
Net Asset Value, Beginning of
Period $56.57 $46.71 $35.57 $34.49 $30.09 $27.68
------- ------- ------- ------- ------- -------
Income from Investment Operations:
Investment Income--net 0.22 0.72 0.74 0.54 0.56 0.65
Net realized and unrealized gain
on investments 3.79 9.14 10.40 0.54 3.84 1.76
------- ------- ------- ------- ------- -------
Total from Investment Operations 4.01 9.86 11.14 1.08 4.40 2.41
------- ------- ------- ------- ------- -------
Net Asset Value, End of the Period $60.58 $56.57 $46.71 $35.57 $34.49 $30.09
------- ------- ------- ------- ------- -------
------- ------- ------- ------- ------- -------
Total Return+ 7.09 % 21.11% 31.32% 3.13% 14.62% 8.71%
Ratios/Supplemental Data
Ratios to Average Net Assets++
Expenses (0.90)% (0.92)% (0.98)% (1.01)% (0.99)% (0.95)%
Investment income--net 0.88 % 1.40% 1.86% 1.56% 1.74% 2.25%
Portfolio Turnover Rate+ 4.39 % 9.95% 7.91% 6.47% 13.41% 18.94%
Average Commission Rate Paid (per
share) $0.05 $0.05 -- -- -- --
Net Assets at End of the Period
($1,000's) $196,730 $217,356 $189,942 $141,544 $146,137 $134,269
</TABLE>
* Using average units basis.
+ Not annualized for periods of less than a year.
++ Annualized for periods of less than a year.
55
<PAGE>
<TABLE>
<CAPTION>
VALUE EQUITY FUND
--------------------------------------------------------------
Six
Months Year Year Year Year Year
Ended Ended Ended Ended Ended Ended
3/31/97 9/30/96 9/30/95 9/30/94 9/30/93 9/30/92
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Per Unit Operating Performance:*
(for a unit outstanding
throughout the period)
Net Asset Value, Beginning of
Period $39.67 $32.63 $27.05 $26.48 $22.94 $21.48
------- ------- ------- ------- ------- -------
Income from Investment Operations:
Investment income--net 0.29 0.72 0.93 0.79 0.70 0.52
Net realized and unrealized gain
(loss) on investments 4.80 6.32 4.65 (0.22) 2.84 0.94
------- ------- ------- ------- ------- -------
Total from Investment Operations 5.09 7.04 5.58 0.57 3.54 1.46
------- ------- ------- ------- ------- -------
Net Asset Value, End of the Period $44.76 $39.67 $32.63 $27.05 $26.48 $22.94
------- ------- ------- ------- ------- -------
------- ------- ------- ------- ------- -------
Total Return+ 12.83 % 21.58% 20.63% 2.15% 15.43% 6.80%
Ratios/Supplemental Data
Ratios to Average Net Assets++
Expenses** (1.22)% (1.20)% (1.32)% (1.41)% (1.70)% (1.55)%
Investment income--net 1.40 % 1.98% 3.24% 3.02% 2.83% 2.32%
Portfolio Turnover Rate+ 73.41 % 61.53% 67.06% 40.41% 54.46% 14.26%
Average Commission Rate Paid (per
share) $0.05 $0.01 -- -- -- --
Net Assets at End of the Period
($1,000's) $50,860 $52,231 $43,824 $35,603 $38,104 $33,417
</TABLE>
* Using average units basis.
** Ratio reflects fees paid with brokerage commissions only
for the years ended 9/30/96 and 9/30/95. For the period
ended 3/31/97, no expenses were paid through
brokerage/service arrangements.
+ Not annualized for periods of less than a year.
++ Annualized for periods of less than a year.
56
<PAGE>
<TABLE>
<CAPTION>
EMERGING GROWTH
EQUITY FUND
--------------------------------------------------------------
Six
Months Year Year Year Year Year
Ended Ended Ended Ended Ended Ended
3/31/97 9/30/96 9/30/95 9/30/94 9/30/93 9/30/92
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Per Unit Operating Performance:*
(for a unit outstanding
throughout the period)
Net Asset Value, Beginning of
Period $67.07 $52.58 $35.96 $35.52 $24.26 $23.34
------- ------- ------- ------- ------- -------
Income from Investment Operations:
Investment income (loss)--net (0.55) (0.90) (0.67) (0.57) (0.53) (0.35)
Net realized and unrealized gain
(loss) on investments (5.22) 15.39 17.29 1.01 11.79 1.27
------- ------- ------- ------- ------- -------
Total from Investment Operations (5.77) 14.49 16.62 0.44 11.26 0.92
------- ------- ------- ------- ------- -------
Net Asset Value, End of the Period $61.30 $67.07 $52.58 $35.96 $35.52 $24.26
------- ------- ------- ------- ------- -------
------- ------- ------- ------- ------- -------
Total Return+ (8.60)% 27.56% 46.22% 1.24% 46.41% 3.94%
Ratios/Supplemental Data
Ratios to Average Net Assets++
Expenses** (1.94)% (1.91)% (2.12)% (2.08)% (2.27)% (2.18)%
Investment income--net (1.44)% (1.54)% (1.61)% (1.64)% (1.78)% (1.43)%
Portfolio Turnover Rate+ 70.42 % 150.40% 170.54% 114.15% 145.59% 135.45%
Average Commission Rate Paid (per
share) $0.02 $0.02 -- -- -- --
Net Assets at End of the Period
($1,000's) $74,736 $92,136 $74,625 $48,293 $56,645 $40,844
</TABLE>
* Using average units basis.
** Ratio reflects fees paid with brokerage commissions only
for the period ended 3/31/97 and for the years ended
9/30/96 and 9/30/95.
+ Not annualized for periods of less than a year.
++ Annualized for periods of less than a year.
57
<PAGE>
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY FUND
--------------------------------------------------------------
Six
Months Year Year Year Year Year
Ended Ended Ended Ended Ended Ended
3/31/97 9/30/96 9/30/95 9/30/94 9/30/93 9/30/92
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Per Unit Operating Performance:*
(for a unit outstanding
throughout the period)
Net Asset Value, Beginning of
Period $45.25 $40.25 $38.08 $34.36 $28.27 $29.26
------- ------- ------- ------- ------- -------
Income from Investment Operations:
Investment income (loss)--net (0.16) (0.08) (0.02) (0.09) (0.21) (0.16)
Net realized and unrealized gain
(loss) on investments 1.04 5.08 2.19 3.81 6.30 (0.83)
------- ------- ------- ------- ------- -------
Total from Investment Operations 0.88 5.00 2.17 3.72 6.09 (0.99)
------- ------- ------- ------- ------- -------
Net Asset Value, End of the Period $46.13 $45.25 $40.25 $38.08 $34.36 $28.27
------- ------- ------- ------- ------- -------
------- ------- ------- ------- ------- -------
Total Return+ 1.94 % 12.42% 5.70% 10.83% 21.54% (3.38)%
Ratios/Supplemental Data
Ratios to Average Net Assets++
Expenses** (1.88)% (1.93)% (1.90)% (1.96)% (2.83)% (2.69)%
Investment income--net (0.74)% (0.20)% (0.07)% (0.25)% (0.68)% (0.50)%
Portfolio Turnover Rate+ 34.67 % 51.29% 51.40% 44.25% 55.02% 52.58%
Average Commission Rate Paid (per
share) $0.02 $0.02 -- -- -- --
Net Assets at End of the Period
($1,000's) $34,604 $39,602 $31,143 $28,672 $21,769 $18,997
</TABLE>
* Using average units basis.
** Ratio reflects fees paid with brokerage commissions only
for the period ended 3/31/97 and for the years ended
9/30/96 and 9/30/95.
+ Not annualized for periods of less than a year.
++ Annualized for periods of less than a year.
58
<PAGE>
<TABLE>
<CAPTION>
ACTIVELY MANAGED
BOND FUND
--------------------------------------------------------------
Six
Months Year Year Year Year Year
Ended Ended Ended Ended Ended Ended
3/31/97 9/30/96 9/30/95 9/30/94 9/30/93 9/30/92
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Per Unit Operating Performance:*
(for a unit outstanding
throughout the period)
Net Asset Value, Beginning of
Period $30.79 $29.58 $26.06 $27.43 $24.57 $21.74
------- ------- ------- ------- ------- -------
Income from Investment Operations:
Investment income--net 0.88 1.80 1.64 1.47 1.23 1.54
Net realized and unrealized gain
(loss) on investments (0.24) (0.59) 1.88 (2.84) 1.63 1.29
------- ------- ------- ------- ------- -------
Total from Investment Operations 0.64 1.21 3.52 (1.37) 2.86 2.83
------- ------- ------- ------- ------- -------
Net Asset Value, End of the Period $31.43 $30.79 $29.58 $26.06 $27.43 $24.57
------- ------- ------- ------- ------- -------
------- ------- ------- ------- ------- -------
Total Return+ 2.08 % 4.09% 13.51% (4.99)% 11.64% 13.02%
Ratios/Supplemental Data
Ratios to Average Net Assets++
Expenses (0.80)% (0.80)% (0.84)% (0.82)% (0.87)% (0.84)%
Investment income--net 6.12 % 5.94% 5.95% 5.51% 5.22% 6.87%
Portfolio Turnover Rate+ 20.81 % 17.14% 18.21% 8.54% 170.16% 132.97%
Net Assets at End of the Period
($1,000's) $132,142 $150,304 $140,127 $136,210 $146,918 $189,827
</TABLE>
* Using average units basis.
+ Not annualized for periods of less than a year.
++ Annualized for periods of less than a year.
59
<PAGE>
<TABLE>
<CAPTION>
INTERMEDIATE-TERM
BOND FUND
--------------------------------------------------------------
Six
Months Year Year Year Year Year
Ended Ended Ended Ended Ended Ended
3/31/97 9/30/96 9/30/95 9/30/94 9/30/93 9/30/92
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Per Unit Operating Performance:*
(for a unit outstanding
throughout the period)
Net Asset Value, Beginning of
Period $29.30 $28.01 $25.40 $25.95 $24.20 $21.72
------- ------- ------- ------- ------- -------
Income from Investment Operations:
Investment income--net 0.84 1.74 1.66 1.46 1.48 1.55
Net realized and unrealized gain
(loss) on investments (0.13) (0.45) 0.95 (2.01) 0.27 0.93
------- ------- ------- ------- ------- -------
Total from Investment Operations 0.71 1.29 2.61 (0.55) 1.75 2.48
------- ------- ------- ------- ------- -------
Net Asset Value, End of the Period $30.01 $29.30 $28.01 $25.40 $25.95 $24.20
------- ------- ------- ------- ------- -------
------- ------- ------- ------- ------- -------
Total Return+ 2.42 % 4.61% 10.28% (2.12)% 7.23% 11.42%
Ratios/Supplemental Data
Ratios to Average Net Assets++
Expenses (1.04)% (0.98)% (0.98)% (0.95)% (1.07)% (0.98)%
Investment income--net 5.78 % 6.06% 6.27% 5.68% 5.95% 6.78%
Portfolio Turnover Rate+ 36.59 % 13.20% 15.95% 17.92% 12.39% 24.86%
Net Assets at End of the Period
($1,000's) $66,878 $74,754 $90,482 $89,780 $97,796 $117,107
</TABLE>
* Using average units basis.
+ Not annualized for periods of less than a year.
++ Annualized for periods of less than a year.
60
<PAGE>
<TABLE>
<CAPTION>
SHORT-TERM
INVESTMENT FUND
--------------------------------------------------------------
Six
Months Year Year Year Year Year
Ended Ended Ended Ended Ended Ended
3/31/97 9/30/96 9/30/95 9/30/94 9/30/93 9/30/92
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Per Unit Operating Performance:*
(for a unit outstanding
throughout the period)
Net Asset Value, Beginning of
Period $20.24 $19.31 $18.36 $17.83 $17.43 $16.80
------- ------- ------- ------- ------- -------
Income from Investment Operations:
Investment income--net 0.48 0.94 0.93 0.53 0.43 0.64
Net realized and unrealized gain
(loss) on investments (0.02) (0.01) 0.02 0.00 (0.03) (0.01)
------- ------- ------- ------- ------- -------
Total from Investment Operations 0.46 0.93 0.95 0.53 0.40 0.63
------- ------- ------- ------- ------- -------
Net Asset Value, End of the Period $20.70 $20.24 $19.31 $18.36 $17.83 $17.43
------- ------- ------- ------- ------- -------
------- ------- ------- ------- ------- -------
Total Return+ 2.27 % 4.82% 5.17% 2.97% 2.29% 3.75%
Ratios/Supplemental Data
Ratios to Average Net Assets++
Expenses (0.80)% (0.80)% (0.80)% (0.80)% (0.89)% (0.79)%
Investment income--net 4.54 % 4.76% 4.94% 2.92% 2.43% 3.72%
Decrease in above expense ratio
due to fee waiver 0.23 % 0.39% 0.34% 0.32% --% --%
Net Assets at End of the Period
($1,000's) $25,508 $25,668 $27,360 $29,975 $35,117 $34,911
</TABLE>
* Using average units basis.
+ Not annualized for periods of less than a year.
++ Annualized for periods of less than a year.
61
<PAGE>
<TABLE>
<CAPTION>
DEDICATED
BOND
FUND
(See
Note 1)
-------
Year
Ended
9/30/92***
-------
<S> <C>
Per Unit Operating Performance:*
(for a unit outstanding throughout the period)
Net Asset Value, Beginning of Period $18.97
-------
Income from Investment Operations: 0.79
Net realized and unrealized gain (loss) on investments 0.07
-------
Total from Investment Operations 0.86
-------
Net Asset Value, End of the Period $19.83 **
-------
-------
Total Return+ 4.53 %
Ratios/Supplemental Data
Ratios to Average Net Assets***
Expenses** (0.75 )
Investment income--net 7.45 %
Portfolio Turnover Rate 0
Net Assets at End of the Period ($1,000's) $0
</TABLE>
* Using average units basis.
** Period from October 1, 1991 to April 24, 1992
*** Annualized
+ Not annualized.
62
<PAGE>
OFFICERS
---------------------------------------------------------------
William Dannecker, President
James P. Coughlin, C.F.A., Executive Vice President and Chief
Investment Officer
Stephen P. Pollak, Esq., Executive Vice President, Counsel and
Secretary
John F. Meuser, Senior Vice President and Treasurer
Durando J. Saccente, Vice President
Veronica A. Fisher, First Vice President and Assistant
Treasurer
Herbert Kuhl, Jr., C.F.A., First Vice President
Denise F. Roche, First Vice President
Chris R. Kaufman, Second Vice President
Deborah A. Modzelewski, Second Vice President
Heidi Viceconte, Second Vice President
CONSULTANTS
---------------------------------------------------------------
Actuarial--Retirement System Consultants Inc.
Investments--Hewitt Associates, LLC
INVESTMENT MANAGERS
---------------------------------------------------------------
Friess Associates, Inc.
HLM Management Co., Inc.
Morgan Grenfell Investment Services Limited
Retirement System Investors Inc.
CUSTODIANS
---------------------------------------------------------------
The Chase Manhattan Bank, N.A.
Custodial Trust Company
DISTRIBUTOR
---------------------------------------------------------------
Retirement System Distributors Inc.
TRANSFER AGENT
---------------------------------------------------------------
Retirement System Consultants Inc.
INDEPENDENT AUDITORS
---------------------------------------------------------------
McGladrey & Pullen, LLP
COUNSEL
---------------------------------------------------------------
Shereff, Friedman, Hoffman & Goodman, LLP
63
<PAGE>
BOARD OF TRUSTEES
---------------------------------------------------------------
Herbert G. Chorbajian
Chairman, President and Chief Executive Officer
ALBANK, FSB, NY
Candace Cox
President
NYNEX Asset Management Co., NY
William Dannecker
President and Chief Executive Officer
Retirement System Group Inc., NY
Eugene C. Ecker
Pension and Group Insurance Consultant
Covington Hardee
Retired Chairman
The Lincoln Savings Bank, FSB, NY
Ralph L. Hodgkins, Jr.
Retired Chief Executive Officer
Mid Maine Savings Bank, FSB, Auburn, ME
Maurice E. Kinkade
Director of Development
Maplebrook School
President, KINCO Management
Willliam G. Lillis
Real Estate Consultant
William L. Schrauth
President and Chief Executive Officer
The Savings Banks of Utica, NY
William E. Swan
President and Chief Executive Officer
Lockport Savings Bank, NY
Raymond L. Willis
Private Investments
64
<PAGE>
THE INFORMATION CONTAINED HEREIN SHALL NOT BE CONSTRUED TO BE OR CONSTITUTE AN
OFFER OR SOLICITATION OF AN OFFER TO BUY UNITS IN THE RSI RETIREMENT TRUST.
SALES OF UNITS IN THE TRUST MAY BE MADE ONLY IN THOSE STATES WHERE SUCH UNITS
ARE EXEMPT FROM REGISTRATION OR HAVE BEEN QUALIFIED FOR SALE. TOTAL RETURNS ARE
BASED ON HISTORICAL RESULTS AND ARE NOT INTENDED TO INDICATE FUTURE PERFORMANCE.
FUTURE PERFORMANCE AND UNIT NET ASSET VALUE WILL FLUCTUATE SO THAT UNITS, IF
REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. THIS MATERIAL MUST
BE PRECEDED OR ACCOMPANIED BY A PROSPECTUS.
<PAGE>
SEMI-ANNUAL
REPORT
[LOGO]
RSI RETIREMENT TRUST
CORE EQUITY FUND
VALUE EQUITY FUND
EMERGING GROWTH EQUITY FUND
INTERNATIONAL EQUITY FUND
ACTIVELY MANAGED BOND FUND
INTERMEDIATE-TERM BOND FUND
SHORT-TERM INVESTMENT FUND
DEDICATED BOND FUND
1997
BROKER/DEALER
[LOGO]
RETIREMENT SYSTEM
Distributors Inc.
P.O. Box 2064
Grand Central Station
New York, NY 10163-2064
