[PHOTO OF BAKERY OMITTED]
ANNUAL REPORT
MAY 31, 1998
ARMADA MONEY MARKET FUND
ARMADA GOVERNMENT MONEY MARKET FUND
ARMADA TREASURY MONEY MARKET FUND
ARMADA TAX EXEMPT MONEY MARKET FUND
ARMADA PENNSYLVANIA TAX EXEMPT MONEY MARKET FUND
ARMADA FUNDS MONEY MARKET SERIES
[Bakery Photo OMITTED]
[ARMADA LOGO OMITTED]
FINANCIAL POWER CLOSE AT HAND
<PAGE>
ARMADA FUNDS
MONEY MARKET SERIES
ANNUAL REPORT -- MAY 31, 1998
ARMADA MONEY MARKET FUND
ARMADA GOVERNMENT MONEY MARKET FUND
ARMADA TREASURY MONEY MARKET FUND
ARMADA TAX EXEMPT MONEY MARKET FUND
ARMADA PENNSYLVANIA TAX EXEMPT MONEY MARKET FUND
TABLE OF CONTENTS
Chairman's Message ........................................................ 1
STATEMENT OF NET ASSETS AND FINANCIAL HIGHLIGHTS
Armada Money Market Fund ............................................... 3
Armada Government Money Market Fund .................................... 9
Armada Treasury Money Market Fund ...................................... 12
Armada Tax Exempt Money Market Fund .................................... 14
Armada Pennsylvania Tax Exempt Money Market Fund ....................... 23
FINANCIAL STATEMENTS
Statement of Operations ................................................ 29
Statement of Changes in Net Assets ..................................... 30
NOTES TO FINANCIAL STATEMENTS ............................................. 32
REPORT OF INDEPENDENT AUDITORS ............................................ 37
- --------------------------------------------------------------------------------
[BULLET] SHARES OF ARMADA FUNDS ARE NOT BANK DEPOSITS OR OBLIGATIONS OF, OR
GUARANTEED OR ENDORSED OR OTHERWISE SUPPORTED BY NATIONAL CITY BANK,
THEIR AFFILIATES OR ANY BANK.
[BULLET] SHARES OF ARMADA FUNDS ARE NOT INSURED OR GUARANTEED BY THE U.S.
GOVERNMENT, FDIC, OR ANY GOVERNMENTAL AGENCY OR STATE.
[BULLET] AN INVESTMENT IN ARMADA FUNDS INVOLVES INVESTMENT RISKS, INCLUDING THE
POSSIBLE LOSS OF PRINCIPAL.
[BULLET] PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE PERFORMANCE, AND THE
INVESTMENT RETURN WILL FLUCTUATE.
National City Bank and certain of its affiliates serve as investment advisers to
Armada Funds for which they receive an investment advisory fee. For more
complete information about Armada Funds, including charges and expenses, please
contact your investment specialist or call 1-800-622-FUND (3863) for a
prospectus. Read it carefully before you invest or send money. Armada Funds are
distributed by SEI Investments Distribution Co. (SIDC), Oaks, PA 19456. SIDC is
not affiliated with National City Bank and is not a bank.
- --------------------------------------------------------------------------------
<PAGE>
CHAIRMAN'S MESSAGE
DEAR ARMADA FUNDS SHAREHOLDER:
We are pleased to report that the year ended May 31, 1998, was a good one for
both the economy and financial markets as well as for Armada Funds. With our
economy's solid growth and low inflationary pressures, stocks posted dramatic
increases and the fixed income markets gained ground as well. Despite volatility
in the financial markets, enthusiasm for investing continued unabated. Many
investors chose to invest in Armada Funds with the result that our assets rose
by 37%, increasing from $5.4 billion at the start of the year, to $7.4 billion
on May 31, 1998.
On March 31, 1998, the merger of National City Corporation and First of
America Bank Corporation was successfully completed. As a direct result of the
merger our funds will be advised and managed by a larger team of investment
professionals. The depth and breadth of expertise and experience this team
brings to our funds will enhance our ability to meet our clients' objectives.
NEW PRODUCT OFFERINGS
In the Spring we added two new funds--the Armada National Tax Exempt Fund and
the Armada Tax Managed Equity Fund. These new funds, plus three additional
equity funds added during the first half of the year, further enhance the range
of investment opportunities within the Armada Family of Funds.
We also have launched the Armada Plus 401(k) program--a comprehensive plan
designed to provide employees of smaller companies with the complete range of
benefits traditionally only enjoyed by the larger tax deferred 401(k) plan
sponsors. The program is a turnkey package--offering employers a solid plan that
combines Armada Funds with comprehensive, affordable plan administration and
recordkeeping.
1
<PAGE>
CHAIRMAN'S MESSAGE
If you would like more information about our newest offerings, the Armada
National Tax Exempt and Tax Managed Equity funds or the Armada Plus 401(k)
program, or a prospectus for any of the Armada Funds, please call your account
representative or 1-800-622-FUND (3863). You also can find us on the WorldWide
Web at WWW.NATIONAL-city.com. Click INVEST IT! for Armada Funds information.
Finally, we would like to thank you for your continued confidence in us.
We look forward to providing you with superior investment management and service
to meet your investment needs now and in the future.
Sincerely,
/S/ SIGNATURE
Robert D. Neary
Chairman
Armada Funds
2
<PAGE>
STATEMENT OF NET ASSETS
ARMADA MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
COMMERCIAL PAPER -- 81.0%
AGRICULTURE -- 2.8%
Canadian Wheat Board
5.420% ........06/03/98 $25,000 $ 24,992
5.440% ........06/17/98 25,000 24,940
Cargill
5.450% ........06/08/98 24,000 23,975
----------
73,907
----------
BANKS -- 2.3%
Norwest Financial
5.500% ........08/10/98 30,000 29,679
5.490% ........08/11/98 30,000 29,675
----------
59,354
----------
CHEMICALS -- 6.4%
Dow Chemical
5.490% ........06/18/98 15,000 14,961
E.I. dupont de Nemours
5.450% ........06/24/98 25,000 24,913
5.430% ........07/29/98 25,000 24,781
5.460% ........08/26/98 50,000 49,348
Monsanto
5.450% ........06/04/98 6,790 6,787
5.450% ........06/09/98 15,000 14,982
5.340% ........07/13/98 20,000 19,875
5.480% ........08/21/98 11,000 10,864
----------
166,511
----------
CONSUMER NON-DURABLES -- 4.2%
Clorox
5.460% ........06/16/98 10,000 9,977
Procter & Gamble
5.460% ........06/25/98 9,480 9,445
5.450% ........06/29/98 45,000 44,809
5.480% ........08/28/98 20,000 19,732
5.480% ........09/08/98 25,000 24,623
----------
108,586
----------
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
COMMERCIAL PAPER -- CONTINUED
DIVERSIFIED -- 1.8%
Minnesota Mining & Manufacturing
5.460% ........07/22/98 $15,000 $ 14,884
5.480% ........07/29/98 12,000 11,894
5.480% ........08/11/98 20,000 19,786
----------
46,564
----------
DRUGS & HEALTH CARE -- 0.8%
Schering-Plough
5.460% ........07/21/98 19,875 19,724
----------
ELECTRONICS -- 3.0%
Lucent Technologies
5.440% ........06/17/98 15,000 14,964
5.440% ........07/16/98 20,000 19,864
5.490% ........08/10/98 19,000 18,797
Motorola, Inc.
5.470% ........06/23/98 $25,000 24,916
----------
78,541
----------
ENTERTAINMENT -- 1.2%
Walt Disney
5.420% ........07/15/98 23,000 22,848
5.410% ........07/29/98 10,000 9,913
----------
32,761
----------
FINANCE-CONDUIT -- 15.2% Ciesco, L.P.
5.470% ........06/16/98 20,000 19,954
5.480% ........06/25/98 20,000 19,927
5.480% ........07/20/98 20,000 19,851
5.470% ........07/28/98 20,000 19,825
5.500% ........08/31/98 20,000 19,722
Corporate Asset Funding
5.480% ........06/11/98 25,000 24,962
5.480% ........07/01/98 30,000 29,863
5.470% ........08/06/98 20,000 19,798
5.510% ........08/20/98 25,000 24,694
See Accompanying Notes
3
<PAGE>
STATEMENT OF NET ASSETS
ARMADA MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
COMMERCIAL PAPER -- CONTINUED
FINANCE-CONDUIT -- CONTINUED
Delaware Funding
5.490% ........07/20/98 $41,230 $ 40,921
5.530% ........07/27/98 20,000 19,828
New Center Asset Trust
5.450% ........07/14/98 25,000 24,837
5.460% ........07/28/98 25,000 24,784
5.430% ........09/09/98 20,000 19,698
Preferred Receivables Funding
5.510% ........06/05/98 20,000 19,988
5.475% ........07/10/98 25,000 24,852
5.530% ........07/27/98 22,460 22,267
----------
395,771
----------
FINANCIAL SERVICES -- 14.7%
American Express Credit
5.450% ........07/14/98 30,000 29,805
5.460% ........07/15/98 15,000 14,900
5.490% ........07/29/98 18,000 17,839
5.500% ........07/31/98 20,000 19,817
Associates First Capital
5.510% ........06/03/98 20,000 19,994
5.500% ........06/30/98 20,000 19,911
Associates of North America
5.490% ........06/12/98 20,000 19,966
5.490% ........07/31/98 20,000 19,817
5.470% ........08/12/98 20,000 19,781
General Electric Capital
5.500% ........08/12/98 25,000 24,725
5.500% ........08/25/98 23,000 22,701
5.510% ........09/08/98 15,000 14,773
5.500% ........09/18/98 22,000 21,634
General Electric Credit Puerto Rico
5.500% ........06/30/98 15,000 14,934
National Rural Utilities Cooperative Finance
5.470% ........06/12/98 20,000 19,967
5.470% ........06/26/98 20,000 19,924
5.470% ........07/22/98 10,000 9,922
5.470% ........07/28/98 21,800 21,609
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
COMMERCIAL PAPER -- CONTINUED
FINANCIAL SERVICES -- CONTINUED
Transamerica Finance
5.510% ........07/17/98 $20,000 $ 19,859
5.510% ........07/24/98 11,875 11,779
----------
383,657
----------
FOOD & BEVERAGE -- 7.1%
Campbell Soup
5.490% ........06/03/98 30,000 29,991
5.450% ........07/14/98 20,000 19,870
Coca-Cola
5.460% ........06/16/98 20,000 19,954
5.440% ........06/26/98 25,000 24,906
5.470% ........07/27/98 25,000 24,787
5.450% ........08/11/98 25,000 24,731
Hershey Foods
5.460% ........06/12/98 10,000 9,983
5.480% ........08/24/98 14,207 14,025
5.470% ........09/15/98 17,600 17,317
----------
185,564
----------
INSURANCE -- 3.2%
American General Corp.
5.470% ........07/31/98 9,000 8,918
5.490% ........08/24/98 10,650 10,514
5.520% ........08/25/98 25,000 24,674
Marsh & McLennan
5.440% ........06/11/98 20,000 19,970
5.440% ........08/21/98 20,000 19,755
----------
83,831
----------
MACHINERY -- 1.3%
John Deere
5.480% ........08/20/98 20,000 19,756
5.490% ........08/28/98 15,000 14,799
----------
34,555
----------
See Accompanying Notes
4
<PAGE>
STATEMENT OF NET ASSETS
ARMADA MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
COMMERCIAL PAPER -- CONTINUED
OFFICE & BUSINESS EQUIPMENT -- 3.2%
Pitney Bowes Credit
5.470% ........06/30/98 $25,000 $ 24,890
5.450% ........07/13/98 20,000 19,873
Xerox Credit
5.440% ........07/10/98 20,000 19,882
5.470% ........07/17/98 19,000 18,867
----------
83,512
----------
OIL & GAS -- 4.8%
Amoco Credit
5.440% ........07/13/98 25,000 24,841
5.430% ........07/23/98 25,000 24,804
5.470% ........08/13/98 25,000 24,723
5.480% ........08/25/98 25,000 24,677
Shell Oil
5.430% ........06/09/98 25,000 24,969
----------
124,014
----------
PRINTING & PUBLISHING -- 1.4%
McGraw Hill
5.470% ........07/15/98 25,165 24,997
5.430% ........09/03/98 12,300 12,126
----------
37,123
----------
TECHNOLOGY -- 2.3%
IBM Credit
5.470% ........06/08/98 15,000 14,984
5.480% ........06/29/98 30,000 29,872
5.470% ........08/24/98 15,000 14,809
----------
59,665
----------
TELECOMMUNICATIONS -- 3.0%
BellSouth Telecommunications
5.510% ........07/21/98 17,000 16,870
5.510% ........07/27/98 9,000 8,923
5.490% ........08/10/98 10,000 9,893
----------
79,491
----------
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
COMMERCIAL PAPER -- CONTINUED
TELECOMMUNICATIONS -- CONTINUED
UTILITIES-ELECTRIC -- 2.3%
SBC Communications
5.460% ........06/22/98 $20,000 $ 19,936
5.440% ........07/07/98 24,000 23,869
----------
43,805
----------
Duke Energy
5.480% ........07/24/98 20,000 19,839
Duke Power
5.470% ........07/09/98 20,000 19,884
Potomac Electric Power
5.510% ........07/24/98 21,000 21,000
----------
60,723
----------
TOTAL COMMERCIAL PAPER
(Cost $2,113,854) .................. 2,113,854
----------
CERTIFICATE OF DEPOSITS -- 6.5%
Bank of Nova Scotia
5.600% ........09/28/98 45,000 44,998
Barclays Bank
5.640% ........10/05/98 30,000 30,004
Bayerische Vereinsbank
5.560% ........06/15/98 30,000 30,000
Deustche Bank
5.580% ........08/06/98 30,000 30,000
National Westminster
5.540% ........07/29/98 13,300 13,301
Societe Generale
5.930% ........08/17/98 20,000 20,006
----------
TOTAL CERTIFICATE OF DEPOSITS
(Cost $168,309) .................... 168,309
----------
See Accompanying Notes
5
<PAGE>
STATEMENT OF NET ASSETS
ARMADA MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MASTER DEMAND NOTES -- 1.7%
Metropolitan Life Insurance (A)
5.526% ........01/05/99 $20,000 $ 20,000
Paccar Financial (A)
5.675% ........12/31/99 25,000 25,000
----------
TOTAL MASTER DEMAND NOTES
(Cost $45,000) 45,000
----------
CASH EQUIVALENT -- 0.5%
Financial Square Premium
Money Market Fund ....... 12,768 12,768
----------
TOTAL CASH EQUIVALENT
(Cost $12,768) .......... 12,768
----------
REPURCHASE AGREEMENTS -- 10.7%
First Boston
5.650% ........06/01/98 150,000 150,000
(Agreement dated 05/19/98
to be repurchased at $150,070,625
on 06/01/98, collateralized
by $150,003,978 Government
Mortgages and Agencies 6.00%
to 8.50% due 09/25/00 to
09/18/27. The market value
of the collateral is $153,004,059)
Prudential
5.630% ........06/01/98 94,919 94,919
(Agreement dated 05/29/98
to be repurchased at $94,963,533
on 06/01/98, collateralized
by $94,923,009 Government
Mortgages and Agencies 5.625%
to 14.833% due 04/14/00 to
06/15/44. The market value
of the collateral
is $96,821,469)
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
REPURCHASE AGREEMENTS -- CONTINUED
Smith Barney
5.590% ........06/01/98 $35,000 $ 35,000
(Agreement dated 05/29/98
to be repurchased at $35,016,304
on 06/01/98, collateralized
by $35,222,000 U.S. TIPS
3.625% due 07/15/02. The market
value of the collateral
is $35,735,000)
TOTAL REPURCHASE AGREEMENTS
(Cost $279,919) .................... 279,919
----------
TOTAL INVESTMENTS -- 100.4%
(Cost $2,619,850) .................. $2,619,850
==========
OTHER ASSETS AND LIABILITIES,
NET-- (0.4%) ....................... (11,263)
-------------
NET ASSETS:
Portfolio Shares of Institutional Class
(unlimited authorization -- no par
value) based on 1,911,527,366
outstanding shares of
beneficial interest ............... 1,911,527
Portfolio Shares of Retail Class
(unlimited authorization -- no
par value) based on 696,828,933
outstanding shares of
beneficial interest ................ 696,829
Portfolio Shares of Class B
(unlimited authorization -- no
par value) based on
4,559 outstanding shares of
beneficial interest ................ 5
Undistributed net investment income . 239
Accumulated net realized loss
on investments ..................... (13)
----------
TOTAL NET ASSETS-- 100.0% ............. $2,608,587
==========
See Accompanying Notes
6
<PAGE>
STATEMENT OF NET ASSETS
ARMADA MONEY MARKET FUND
MAY 31, 1998
VALUE
(000)
-----
NET ASSET VALUE, OFFERING
AND REDEMPTION PRICE
PER SHARE -- INSTITUTIONAL
CLASS .............................. $1.00
==========
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER
SHARE -- RETAIL CLASS .............. $1.00
==========
NET ASSET VALUE AND
OFFERING PRICE PER
SHARE -- CLASS B ................... $1.00
==========
------------------------
(A) VARIABLE RATE SECURITY -- THE RATE REFLECTED ON THE STATEMENT OF NET ASSETS
IS THE RATE IN EFFECT ON MAY 31, 1998.
See Accompanying Notes
7
<PAGE>
FINANCIAL HIGHLIGHTS
ARMADA MONEY MARKET FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
FOR THE YEAR ENDED MAY 31,
------------------------------------------------------------------------------------------------
1998 1997 1996 1995
----------------------------- -------------------- -------------------- ---------------------
INSTITUTIONAL RETAIL CLASS B4 INSTITUTIONAL RETAIL INSTITUTIONAL RETAIL INSTITUTIONAL RETAIL
------------- ------ -------- ------------- ------ ------------- ------ ------------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning
of period ......... $ 1.00 $ 1.00 $1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- -------- ----- ---------- -------- ---------- -------- ---------- -------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05
LESS DISTRIBUTIONS
Dividends from net
investment income (0.05) (0.05) (0.05) (0.05) (0.05) (0.05) (0.05) (0.05) (0.05)
---------- -------- ----- ---------- -------- ---------- -------- ---------- -------
Net asset value, end of
period ............ $ 1.00 $ 1.00 $1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- -------- ----- ---------- -------- ---------- -------- ---------- -------
TOTAL RETURN 5.39% 5.26% 5.04% 5.19% 5.09% 5.45% 5.35% 5.11% 5.01%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(in 000's) ....... $1,911,689 $696,893 $ 5 $1,943,021 $346,172 $1,344,414 $343,087 $1,083,243 $175,192
Ratio of expenses to
average net assets 0.38%1 0.51%2 1.22%3 0.37%1 0.47%2 0.37%1 0.47%2 0.37%1 0.47%2
Ratio of net investment
income to average
net assets ....... 5.27%1 5.14%2 4.39%3 5.07%1 4.97%2 5.30%1 5.18%2 5.07%1 5.12%2
FOR THE YEAR ENDED MAY 31,
--------------------
1994
--------------------
INSTITUTIONAL RETAIL
------------- ------
Net asset value, beginning
of period ......... $ 1.00 $ 1.00
-------- -------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income 0.03 0.03
LESS DISTRIBUTIONS
Dividends from net
investment income (0.03) (0.03)
-------- -------
Net asset value, end of
period ............ $ 1.00 $ 1.00
-------- -------
TOTAL RETURN 2.91% 2.81%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(in 000's) ....... $743,377 $67,229
Ratio of expenses to
average net assets 0.43%1 0.53%2
Ratio of net investment
income to average
net assets ....... 2.94%1 2.78%2
<FN>
1 THE OPERATING EXPENSE RATIO AND THE NET INVESTMENT INCOME RATIO BEFORE FEE
WAIVERS BY THE INVESTMENT ADVISERS FOR THE INSTITUTIONAL CLASS FOR THE YEARS
ENDED MAY 31, 1998 AND MAY 31, 1997 WOULD HAVE BEEN 0.48% AND 5.17% AND .47%
AND 4.97%, RESPECTIVELY. THE OPERATING EXPENSE RATIO AND NET INVESTMENT
INCOME RATIO BEFORE FEE WAIVERS BY THE INVESTMENT ADVISERS AND CUSTODIAN FOR
THE INSTITUTIONAL CLASS FOR THE YEARS ENDED MAY 31, 1996 AND 1995 WOULD HAVE
BEEN .48% AND 5.19% AND .48% AND 4.96%, RESPECTIVELY. THE OPERATING EXPENSE
RATIO AND THE NET INVESTMENT INCOME RATIO BEFORE FEE WAIVER BY THE
INVESTMENT ADVISERS FOR THE INSTITUTIONAL CLASS FOR THE YEAR ENDED MAY 31,
1994 WOULD HAVE BEEN .45% AND 2.92%, RESPECTIVELY.
2 THE OPERATING EXPENSE RATIO AND THE NET INVESTMENT INCOME RATIO BEFORE FEE
WAIVERS BY THE INVESTMENT ADVISERS FOR THE RETAIL CLASS FOR THE YEARS ENDED
MAY 31, 1998 AND MAY 31, 1997 WOULD HAVE BEEN 0.61% AND 5.08% AND .57% AND
4.87%, RESPECTIVELY. THE OPERATING EXPENSE RATIO AND NET INVESTMENT INCOME
RATIO BEFORE FEE WAIVERS BY THE INVESTMENT ADVISERS AND CUSTODIAN FOR THE
RETAIL CLASS FOR THE YEARS ENDED MAY 31, 1996 AND 1995 WOULD HAVE BEEN .58%
AND 5.07% AND .58% AND 5.01%, RESPECTIVELY. THE OPERATING EXPENSE RATIO AND
NET INVESTMENT INCOME RATIO BEFORE FEE WAIVERS BY THE INVESTMENT ADVISERS
FOR THE RETAIL CLASS FOR THE YEAR ENDED MAY 31, 1994 WOULD HAVE BEEN .55%
AND 2.76%, RESPECTIVELY.
3 THE OPERATING EXPENSE RATIO AND THE NET INVESTMENT INCOME RATIO BEFORE FEE
WAIVERS BY THE INVESTMENT ADVISERS FOR THE CLASS B FOR THE PERIOD ENDED MAY
31, 1998 WOULD HAVE BEEN 1.27% AND 4.31%, RESPECTIVELY.
4 THE MONEY MARKET FUND CLASS B COMMENCED OPERATIONS JANUARY 5, 1998.
</FN>
</TABLE>
See Accompanying Notes
8
<PAGE>
STATEMENT OF NET ASSETS
ARMADA GOVERNMENT MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
AGENCY OBLIGATIONS -- 75.7%
FEDERAL FARM CREDIT BANK-- 19.3%
5.425% ........06/11/98 $15,000 $ 14,977
5.410% ........06/22/98 5,000 4,984
5.400% ........07/01/98 17,772 17,692
5.380% ........07/06/98 8,000 7,958
4.250% ........07/07/98 15,000 14,919
5.310% ........07/09/98 6,000 5,966
5.280% ........07/13/98 30,898 30,708
5.380% ........07/16/98 5,300 5,264
5.360% ........07/17/98 15,000 14,897
5.375% ........07/21/98 26,715 26,515
5.508% ........07/23/98 5,000 4,961
5.340% ........07/24/98 18,000 17,859
5.370% ........08/13/98 20,000 19,782
5.340% ........08/14/98 20,000 19,780
5.380% ........08/21/98 11,000 10,867
5.370% ........09/04/98 15,000 14,787
5.290% ........09/22/98 18,520 18,212
5.385% ........10/09/98 12,000 11,767
5.365% ........10/13/98 5,000 4,900
----------
266,795
----------
FEDERAL HOME LOAN BANK -- 17.2%
5.530% ........06/05/98 10,000 9,994
5.430% ........06/11/98 4,870 4,863
5.400% ........06/15/98 20,000 19,958
5.300% ........06/30/98 25,000 24,893
5.390% ........07/08/98 10,000 9,945
5.536% ........07/17/98 15,000 14,897
5.385% ........07/30/98 20,000 19,824
5.400% ........08/05/98 20,000 19,805
5.280% ........08/07/98 10,000 9,902
5.400% ........08/12/98 20,000 19,784
5.360% ........08/26/98 5,358 5,289
5.345% ........09/09/98 15,000 14,777
5.380% ........09/23/98 20,000 19,659
5.380% ........09/25/98 15,000 14,740
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
AGENCY OBLIGATIONS -- CONTINUED
FEDERAL HOME LOAN BANK-- CONTINUED
5.350% ........10/06/98 $15,000 $ 14,717
5.400% ........10/21/98 15,300 14,974
----------
238,021
----------
FEDERAL HOME LOAN MORTGAGE CORPORATION -- 19.2%
5.400% ........06/01/98 25,000 25,000
5.410% ........06/03/98 25,000 24,993
5.330% ........06/04/98 30,000 29,987
5.425% ........06/08/98 20,000 19,979
5.420% ........06/12/98 30,000 29,950
5.410% ........06/16/98 20,000 19,955
5.425% ........06/30/98 50,000 49,781
5.300% ........07/06/98 10,500 10,446
5.390% ........07/09/98 10,000 9,943
5.460% ........07/10/98 10,000 9,942
5.410% ........08/06/98 11,613 11,498
5.430% ........08/11/98 15,000 14,839
5.355% ........09/04/98 10,054 9,912
----------
266,225
----------
FEDERAL NATIONAL MORTGAGE ASSOCIATION -- 20.0%
5.310% ........06/05/98 10,000 9,994
5.526% ........07/15/98 15,000 14,901
5.400% ........07/16/98 10,000 9,933
5.410% ........07/27/98 18,483 18,327
5.260% ........07/30/98 20,000 19,823
5.400% ........08/03/98 6,165 6,107
5.390% ........08/07/98 17,175 17,003
5.400% ........08/10/98 10,000 9,895
5.400% ........08/18/98 20,000 19,766
5.410% ........08/24/98 20,000 19,748
5.400% ........08/27/98 30,452 30,055
4.370% ........09/08/98 45,519 44,846
5.380% ........09/23/98 6,160 6,055
5.380% ........09/24/98 16,091 15,814
5.577% ........09/24/98 10,000 9,828
See Accompanying Notes
9
<PAGE>
STATEMENT OF NET ASSETS
ARMADA GOVERNMENT MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
AGENCY OBLIGATIONS -- CONTINUED
FEDERAL NATIONAL MORTGAGE ASSOCIATION-- CONTINUED
5.380% ........09/29/98 $ 7,310 $ 7,179
5.370% ........09/30/98 8,145 7,998
5.360% ........10/21/98 10,000 9,789
----------
277,061
----------
TOTAL AGENCY OBLIGATIONS
(Cost $1,048,102) ................... 1,048,102
----------
CASH EQUIVALENT -- 0.5%
Financial Square Government
Money Market Fund .............6,557 6,557
----------
TOTAL CASH EQUIVALENT
(Cost $6,557) ...................... 6,557
----------
REPURCHASE AGREEMENTS -- 24.2%
First Boston
5.650% ........06/01/98 150,000 150,000
(Agreement dated 05/29/98
to be repurchased at $150,070,625
on 06/01/98, collateralized
by $150,898,843 Government
Agencies, 6.00% to 9.00% due
03/01/09 to 12/01/33. The
market value of the collateral
is $153,916,822)
Prudential
5.630% ........06/01/98 185,706 185,706
(Agreement dated 05/29/98
to be repurchased at $185,793,127
on 06/01/98, collateralized
by $185,708,066 Government
Agencies, 3.375% to 7.00% due
06/11/98 to 03/25/24. The
market value of the collateral
is $189,420,187) ----------
TOTAL REPURCHASE AGREEMENTS
(Cost $335,706) ................... 335,706
----------
VALUE
(000)
-----
TOTAL INVESTMENTS -- 100.4%
(Cost $1,390,365) $1,390,365
==========
OTHER ASSETS AND LIABILITIES,
NET-- (0.4%) (6,006)
----------
NET ASSETS:
Portfolio Shares of Institutional
(unlimited authorization -- no
par value) based on 1,136,375,656
outstanding shares of
beneficial interest ............... 1,136,376
Portfolio Shares of Retail Class
(unlimited authorization -- no
par value) based on 247,986,052
outstanding shares of
beneficial interest ............... 247,986
Accumulated net realized loss
on investments .................... (3)
----------
TOTAL NET ASSETS-- 100.0% ............ $1,384,359
==========
NET ASSET VALUE, OFFERING
AND REDEMPTION
PRICE PER SHARE --
INSTITUTIONAL CLASS ............... $1.00
==========
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER
SHARE -- RETAIL CLASS ............. $1.00
==========
See Accompanying Notes
10
<PAGE>
FINANCIAL HIGHLIGHTS
ARMADA GOVERNMENT MONEY MARKET FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
FOR THE YEAR ENDED MAY 31,
--------------------------------------------------------------------------------------
1998 1997 1996 1995
-------------------- -------------------- -------------------- --------------------
INSTITUTIONAL RETAIL INSTITUTIONAL RETAIL INSTITUTIONAL RETAIL INSTITUTIONAL RETAIL
------------- ------ ------------- ------ ------------- ------ ------------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning
of period ............ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- -------- -------- -------- -------- -------- -------- -------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05
LESS DISTRIBUTIONS
Dividends from net
investment income ... (0.05) (0.05) (0.05) (0.05) (0.05) (0.05) (0.05) (0.05)
---------- -------- -------- -------- -------- -------- -------- -------
Net asset value, end of
period ............... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- -------- -------- -------- -------- -------- -------- -------
TOTAL RETURN 5.30% 5.17% 5.15% 5.04% 5.41% 5.31% 4.97% 4.87%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(in 000's) .......... $1,137,078 $247,281 $811,622 $159,129 $741,894 $131,194 $618,058 $19,174
Ratio of expenses to
average net assets .. 0.40%1 0.52%2 0.36%1 0.47%2 0.36%1 0.46%2 0.39%1 0.51%2
Ratio of net investment
income to average
net assets .......... 5.17%1 5.05%2 5.03%1 4.93%2 5.27%1 5.13%2 4.83%1 5.01%2
FOR THE YEAR ENDED MAY 31,
--------------------
1994
--------------------
INSTITUTIONAL RETAIL
------------- ------
Net asset value, beginning
of period ............ $ 1.00 $ 1.00
------- ------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income 0.03 0.03
LESS DISTRIBUTIONS
Dividends from net
investment income ... (0.03) (0.03)
------- ------
Net asset value, end of
period ............... $ 1.00 $ 1.00
------- ------
TOTAL RETURN 2.91% 2.80%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(in 000's) .......... $768,337 $6,945
Ratio of expenses to
average net assets .. 0.42%1 0.52%2
Ratio of net investment
income to average
net assets .......... 2.92%1 2.75%2
<FN>
1 THE OPERATING EXPENSE RATIO AND THE NET INVESTMENT INCOME RATIO BEFORE FEE
WAIVERS BY THE INVESTMENT ADVISERS FOR THE INSTITUTIONAL CLASS FOR THE YEARS
ENDED MAY 31, 1998 AND MAY 31, 1997 WOULD HAVE BEEN 0.50% AND 5.07% AND .46%
AND 4.93%, RESPECTIVELY. THE OPERATING EXPENSE RATIO AND NET INVESTMENT
INCOME RATIO BEFORE FEE WAIVERS BY THE INVESTMENT ADVISERS AND CUSTODIAN FOR
THE INSTITUTIONAL CLASS FOR THE YEARS ENDED MAY 31, 1996 AND 1995 WOULD HAVE
BEEN .47% AND 5.16% AND .50% AND 4.72%, RESPECTIVELY. THE OPERATING EXPENSE
RATIO AND THE NET INVESTMENT INCOME RATIO BEFORE FEE WAIVERS BY THE
INVESTMENT ADVISERS FOR THE INSTITUTIONAL CLASS FOR THE YEARS ENDED MAY 31,
1994 AND 1993 WOULD HAVE BEEN .44% AND 2.90% AND .46% AND 2.82%,
RESPECTIVELY.
2 THE OPERATING EXPENSE RATIO AND THE NET INVESTMENT INCOME RATIO BEFORE FEE
WAIVERS BY THE INVESTMENT ADVISERS FOR THE RETAIL CLASS FOR THE YEARS ENDED
MAY 31, 1998 AND MAY 31, 1997 WOULD HAVE BEEN 0.62% AND 4.95% AND .57% AND
4.83%, RESPECTIVELY. THE OPERATING EXPENSE RATIO AND NET INVESTMENT INCOME
RATIO BEFORE FEE WAIVERS BY THE INVESTMENT ADVISERS AND CUSTODIAN FOR THE
RETAIL CLASS FOR THE YEARS ENDED MAY 31, 1996 AND 1995 WOULD HAVE BEEN .57%
AND 5.02% AND .63% AND 4.90%, RESPECTIVELY. THE OPERATING EXPENSE RATIO AND
NET INVESTMENT INCOME RATIO BEFORE FEE WAIVERS BY THE INVESTMENT ADVISERS
FOR THE RETAIL CLASS FOR THE YEARS ENDED MAY 31, 1994 AND 1993 WOULD HAVE
BEEN .54% AND 2.73%, AND .56% AND 2.72%, RESPECTIVELY.
</FN>
</TABLE>
See Accompanying Notes
11
<PAGE>
STATEMENT OF NET ASSETS
ARMADA TREASURY MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
U.S. TREASURY OBLIGATIONS -- 97.9%
U.S. TREASURY BILLS+ -- 76.9%
5.010% ........06/04/98 $24,000 $ 23,990
5.040% ........06/11/98 27,000 26,963
4.910% ........06/18/98 22,000 21,949
5.340% ........06/25/98 18,000 17,940
4.910% ........07/02/98 20,000 19,916
4.920% ........07/02/98 12,000 11,949
4.940% ........07/09/98 25,000 24,871
4.840% ........07/16/98 21,000 20,873
5.210% ........07/23/98 15,000 14,891
4.960% ........08/06/98 23,000 22,793
5.000% ........08/13/98 23,000 22,766
5.335% ........08/20/98 25,000 24,719
4.940% ........08/27/98 20,000 19,761
5.080% ........09/10/98 9,000 8,874
----------
282,255
----------
U.S. TREASURY NOTES -- 21.0%
5.125% ........06/30/98 10,000 9,999
6.250% ........06/30/98 9,000 9,006
6.250% ........07/31/98 23,000 23,038
4.750% ........08/31/98 20,000 19,968
6.000% ........09/30/98 15,000 15,026
----------
77,037
----------
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $359,292) .................... 359,292
----------
CASH EQUIVALENTS -- 2.2%
Federated Investors U.S.
Treasury Cash Reserve
Money Market Fund ....... 1,747 1,747
Financial Square Treasury
Money Market Fund ....... 6,126 6,126
----------
TOTAL CASH EQUIVALENTS
(Cost $7,873) ...................... 7,873
----------
VALUE
(000)
-----
TOTAL INVESTMENTS -- 100.1%
(Cost $367,165) .................... $ 367,165
==========
OTHER ASSETS AND LIABILITIES,
NET-- (0.1%) ....................... (338)
----------
NET ASSETS:
Portfolio Shares of Institutional
(unlimited authorization -- no
par value) based on 359,584,112
outstanding shares of
beneficial interest ................ 359,584
Portfolio Shares of Retail Class
(unlimited authorization -- no par value)
based on 7,221,285 outstanding shares of
beneficial interest ................ 7,221
Accumulated net realized gain
on investments ..................... 22
----------
TOTAL NET ASSETS-- 100.0% ............. $ 366,827
==========
NET ASSET VALUE, OFFERING
AND REDEMPTION
PRICE PER SHARE --
INSTITUTIONAL CLASS ................ $1.00
==========
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE --
RETAIL CLASS ....................... $1.00
==========
------------------------------------------------
+ EFFECTIVE YIELD
See Accompanying Notes
12
<PAGE>
FINANCIAL HIGHLIGHTS
ARMADA TREASURY MONEY MARKET FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
FOR THE YEAR ENDED MAY 31, FOR THE PERIOD
------------------------------------------------------------------- ENDED MAY 31,
1998 1997 1996 1995
------------------------------------------------------------------- -----------------------
INSTITUTIONAL RETAIL INSTITUTIONAL RETAIL INSTITUTIONAL RETAIL INSTITUTIONAL3 RETAIL4
------------- ------ ------------- ------ ------------- ------ -------------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning
of period .................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- ------- -------- ------ -------- ------- ------- -------
INCOME FROM INVESTMENT OPERATIONS
Net investment income ....... 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.02
LESS DISTRIBUTIONS
Dividends from net
investment income ......... (0.05) (0.05) (0.05) (0.05) (0.05) (0.05) (0.05) (0.02)
-------- ------- -------- ------ -------- ------- ------- -------
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======= ======== ====== ======== ======= ======= =======
TOTAL RETURN .................. 4.95% 4.82% 4.89% 4.79% 5.07% 4.97% 4.86%5 5.41%5
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(in 000's) ............... $359,605 $ 7,222 $276,327 $5,680 $312,255 $ 4,355 $142,877 $ 366
Ratio of expenses to average
net assets ............... 0.39%1 0.51%2 0.37%1 0.47%2 0.41%1 0.52%2 0.43%1,5 0.56%2,5
Ratio of net investment income
to average net assets ..... 4.84%1 4.71%2 4.79%1 4.68%2 4.88%1 4.77%2 4.78%1,5 5.35%2,5
<FN>
1 THE OPERATING EXPENSE RATIO AND THE NET INVESTMENT INCOME RATIO BEFORE FEE
WAIVERS BY THE INVESTMENT ADVISERS FOR THE INSTITUTIONAL CLASS FOR THE YEARS
ENDED MAY 31, 1998 AND MAY 31, 1997 WOULD HAVE BEEN 0.44% AND 4.79% AND .42%
AND 4.74%, RESPECTIVELY. THE OPERATING EXPENSE RATIO AND NET INVESTMENT
INCOME RATIO BEFORE FEE WAIVERS BY THE INVESTMENT ADVISERS AND CUSTODIAN FOR
THE INSTITUTIONAL CLASS FOR THE YEARS ENDED MAY 31, 1996 AND FOR THE PERIOD
ENDED MAY 31, 1995 WOULD HAVE BEEN .47% AND 4.82% AND .49% AND 4.72%,
RESPECTIVELY.
2 THE OPERATING EXPENSE RATIO AND THE NET INVESTMENT INCOME RATIO BEFORE FEE
WAIVERS BY THE INVESTMENT ADVISERS FOR THE RETAIL CLASS FOR THE YEARS ENDED
MAY 31, 1998 MAY 31, 1997 AND WOULD HAVE BEEN 0.56% AND 4.66% AND .52% AND
4.63%, RESPECTIVELY. THE OPERATING EXPENSE RATIO AND NET INVESTMENT INCOME
RATIO BEFORE FEE WAIVERS BY THE INVESTMENT ADVISERS AND CUSTODIAN FOR THE
RETAIL CLASS FOR THE YEAR ENDED MAY 31, 1996 AND FOR THE PERIOD ENDED MAY
31, 1995 WOULD HAVE BEEN .58% AND 4.71% AND .63% AND 5.28%, RESPECTIVELY.
3 INSTITUTIONAL CLASS COMMENCED OPERATIONS ON JUNE 16, 1994.
4 RETAIL CLASS COMMENCED OPERATIONS ON DECEMBER 22, 1994.
5 ANNUALIZED
</FN>
</TABLE>
See Accompanying Notes
13
<PAGE>
STATEMENT OF NET ASSETS
ARMADA TAX EXEMPT MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- 100.4%
ALABAMA -- 1.6%
Columbia Industrial Development
Board Pollution Control Revenue
Refunding Bond, Alabama
Power Co. Project (A) (B)
4.000% ........06/01/98 $3,300 $ 3,300
Montgomery Industrial Development
Board Pollution Control & Solid
Waste Disposal Revenue Refunding
Bond, General Electric
Company Project, TECP
3.650% ........06/25/98 3,390 3,390
Montgomery Special Care Facilities
Hospital Authority Revenue
Bond 1985 Series D (B) (AMBAC)
3.750% ........06/07/98 2,000 2,000
-----------
8,690
-----------
ALASKA -- 1.7%
Valdez Marine Terminal, Arco
Transportation Project,
Series 1994-A, TECP
3.700% ........07/06/98 3,300 3,300
Series 1994-B (B)
3.800% ........06/07/98 6,000 6,000
-----------
9,300
-----------
ARIZONA -- 3.7%
Maricopa County Pollution
Control Revenue Bond,
Southern California Edison, TECP
Series D
3.600% ........06/26/98 2,000 2,000
3.600% ........09/11/98 1,000 1,000
Series E
3.500% ........06/09/98 2,150 2,150
3.400% ........06/24/98 2,000 2,000
3.400% ........07/15/98 4,000 4,000
Series F
3.400% ........06/24/98 2,600 2,600
3.600% ........06/24/98 3,250 3,250
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
ARIZONA-- CONTINUED
Salt River Project Agricultural
Power Distribution Revenue Bond
3.350% ........06/11/98 $2,000 $ 2,000
Salt River Project Agricultural
Improvement & Power District
Revenue Bond
3.750% ........06/16/98 1,370 1,370
-----------
20,370
-----------
COLORADO -- 3.1%
Colorado Health Facilities Authority
Revenue Bond, North Colorado
Medical Center (B)
3.900% ........06/07/98 4,300 4,300
Colorado Health Facilities Authority
Revenue Bond, Catholic
Health Initiatives, Series B (B)
3.900% ........06/07/98 8,000 8,000
University of Colorado Regents
Enterprise System Adjustable
Tender Revenue Bond, Series 1996-A (B)
3.950% ........06/07/98 5,000 5,000
-----------
17,300
-----------
CONNECTICUT -- 1.3%
Connecticut State Health & Higher
Education Facilities Revenue
Bond, Yale University, Series T-2 (B)
3.800% ........06/07/98 7,000 7,000
-----------
FLORIDA -- 5.5%
Florida Municipal Power Agency
Pooled Loan Project, Series A, TECP
3.800% ........06/05/98 1,000 1,000
Gainesville Utilities System,
Series C, TECP
3.450% ........06/15/98 1,424 1,424
3.600% ........06/19/98 5,198 5,198
3.550% ........06/26/98 4,448 4,448
See Accompanying Notes
14
<PAGE>
STATEMENT OF NET ASSETS
ARMADA TAX EXEMPT MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
FLORIDA -- CONTINUED
Jackonsville Pollution Control
Revenue Bond, Florida Power
& Light Project, TECP
3.450% ........06/11/98 $3,000 $ 3,000
3.600% ........06/12/98 3,200 3,200
3.650% ........06/25/98 2,810 2,810
3.750% ........06/17/98 1,700 1,700
3.700% ........08/12/98 2,450 2,450
Putnam County, Development
Authority Pollution Control
Revenue Bond, Florida
Seminole Electric, TECP
3.500% ........09/15/98 5,000 5,000
-----------
30,230
-----------
GEORGIA -- 2.6%
Burke County Development
Authority Pollution Control
Revenue Bond, Georgia Power
Plant Vogtle Project (A) (B)
3.727% ........06/01/98 1,900 1,900
3.727% ........06/01/98 2,500 2,500
Georgia Municipal Gas Authority
Revenue Bond,
Series C (B)
3.750% ........06/07/98 8,000 8,000
Savannah Development Authority
Revenue Bond, Downtown
Parking Authority (B)
3.950% ........06/07/98 2,000 2,000
-----------
14,400
-----------
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
ILLINOIS -- 2.8%
City of Chicago GO, TECP
3.550% ........02/04/99 $3,000 $ 3,000
City of Chicago GO (B)
3.550% ........10/29/98 2,700 2,700
Illinois Educational Facility
Authority Revenue Bond,
Northwestern University,
Series 1988 (B)
3.850% ........06/07/98 8,736 8,736
Illinois State GO
4.500% ........02/01/99 1,000 1,005
-----------
15,441
-----------
INDIANA -- 8.2%
Evansville Economic Development
Authority Revenue Bond, Ball
Corporation Project (B)
3.800% ........06/07/98 1,500 1,500
Hammond Indiana Local Public
Improvements Revenue Bond,
Bank Advance Funding Program
Notes, Series 1998 A-2
4.300% ........01/07/99 4,000 4,012
Indiana Health Facility Finance
Authority Revenue Bond, Capital
Access Designated Pool,
Series 1989-B (B)
3.800% ........06/07/98 1,700 1,700
Indiana Hospital Equipment
Finance Authority Revenue
Bond, Series 1985-A (B) (MBIA)
3.800% ........06/01/98 8,885 8,885
See Accompanying Notes
15
<PAGE>
STATEMENT OF NET ASSETS
ARMADA TAX EXEMPT MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
INDIANA-- CONTINUED
Purdue University, Indiana
Universities Revenue Bond,
Trustees Student Fee (B)
Series E
3.700% ........06/07/98 $ 320 $ 320
3.700% ........06/07/98 5,120 5,120
3.700% ........06/07/98 960 960
Series L
3.700% ........06/07/98 200 200
Series O
3.700% ........06/07/98 1,450 1,450
Sullivan Indiana National Rural
Utilities Corporation Finance
Authority Revenue Bond, Hoosier
Energy Rural Electric, TECP
3.550% ........06/25/98 6,000 6,000
3.550% ........07/07/98 4,500 4,500
3.550% ........07/08/98 4,295 4,295
3.405% ........07/15/98 6,545 6,545
-----------
45,487
-----------
IOWA -- 0.6%
Iowa State School Cash Anticipation
Program, Series B
4.250% ........01/28/99 2,500 2,511
Polk County, Health Facilities
Authority Revenue Bond,
Catholic Health Initiatives,
Series 1997-B (B)
3.900% ........06/07/98 1,000 1,000
-----------
3,511
-----------
KANSAS -- 2.1%
Burlington TECP
3.700% ........08/11/98 2,900 2,900
Kansas State Department of
Transportation Highway
Revenue Bonds, Series B (B)
4.200% ........06/07/98 6,500 6,500
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
KANSAS -- CONTINUED
Wichita GO
3.450% ........08/27/98 $2,000 $ 2,004
------------
11,404
------------
LOUISIANA -- 3.5%
East Baton Rouge Pollution Control
Revenue Bond, Exxon Project (B)
3.950% ........06/01/98 11,500 11,500
Plaquemines Port Harbor Terminal
District Electro-Coal Transfer,
Series A, TECP
3.550% ........06/05/98 1,500 1,500
3.550% ........06/08/98 6,200 6,200
-----------
19,200
-----------
MARYLAND -- 1.3%
Maryland National Capital Park
& Planning Commission
Variable BAN (B)
4.000% ........06/01/98 7,100 7,100
-----------
MASSACHUSETTS -- 0.5%
City of Cambridge GO
4.500% ........02/01/99 2,700 2,716
-----------
MICHIGAN -- 1.3%
Board of Control of Michigan
Technological University General
Revenue Bond, Series A (B)
3.800% ........06/07/98 1,000 1,000
Michigan Municipal Bond
Authority Revenue Notes
Series 1997-B
4.500% ........07/02/98 6,000 6,003
-----------
7,003
-----------
See Accompanying Notes
16
<PAGE>
STATEMENT OF NET ASSETS
ARMADA TAX EXEMPT MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
MINNESOTA -- 7.5%
Becker Pollution Control Revenue
Bond, Northern States Power, TECP
3.550% ........07/16/98 $ 2,200 $ 2,200
3.700% ........08/12/98 2,000 2,000
3.650% ........08/20/98 5,000 5,000
3.450% ........08/28/98 3,000 3,000
3.500% ........10/13/98 6,000 6,000
Hennepin County GO, Series C (B)
3.650% ........06/07/98 7,000 7,000
3.300% ........06/07/98 1,000 1,000
Minneapolis GO, Series 1997 (B)
3.300% ........06/07/98 6,000 6,000
3.700% ........06/07/98 6,000 6,000
Olmsted County, Minnesota
Certificates of Participation
Human Services Campus
Infrastructure Revenue
Bond (A) (B)
3.850% ........06/07/98 3,000 3,000
-----------
41,200
-----------
MISSISSIPPI -- 1.8%
Forest Industrial Development
Revenue Bond, Sara Lee Corp.
Project, Series 1992 (B)
3.850% ........06/07/98 8,000 8,000
Jackson County GO,
Water System, Chevron Project, TECP
3.550% ........08/03/98 2,200 2,200
-----------
10,200
-----------
MISSOURI -- 0.7%
Missouri Health & Educational
Facility Authority Revenue Bond,
Sisters of Mercy, Series C (B)
3.850% ........06/07/98 4,100 4,100
------------
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
MONTANA -- 1.2%
Forsyth Pollution Control Revenue
Bond, Portland General Electric
Project, Series 1983-B (B)
3.750% ........06/07/98 $6,800 $ 6,800
-----------
NEVADA -- 0.2%
Las Vegas Valley Water
District TECP
3.500% ........07/13/98 1,000 1,000
-----------
NEW MEXICO -- 0.2%
New Mexico State
Severance TRAN
4.800% ........07/01/98 1,000 1,001
-----------
NEW YORK -- 0.5%
New York City Municipal Water
Authority, TECP,
Series 3
3.900% ........06/25/98 3,000 3,000
-----------
NORTH CAROLINA -- 1.9%
North Carolina Education Facilities
Finance Agency Revenue Bond,
Bowman Gray School of Medicine
Project, Series 1990 (B)
3.900% ........06/07/98 10,600 10,600
-----------
OHIO -- 18.9%
Columbus Unlimited GO TRAN,
Series 1995-1 (B)
3.550% ........06/07/98 5,700 5,700
Cuyahoga County Hospital
Facilities Revenue Bond,
Cleveland Clinic Foundation,
Series 1996-A (B)
3.750% ........06/07/98 2,000 2,000
Series 1996-B
3.800% ........06/07/98 9,800 9,800
Series 1997-B
3.800% ........06/07/98 900 900
Series 1997-D
4.000% ........06/01/98 5,000 5,000
See Accompanying Notes
17
<PAGE>
STATEMENT OF NET ASSETS
ARMADA TAX EXEMPT MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
OHIO -- CONTINUED
Erie County BAN
4.250% ........06/01/99 $2,000 $ 2,010
Franklin County, Hospital Facilities
Revenue Bond, Lutheran Senior
City Project, Series 1994 (B)
3.850% ........06/07/98 300 300
Hamilton County GO,
Series 1998
3.870% ........04/08/99 1,240 1,243
Lake County, TECP
3.550% ........09/10/98 1,300 1,302
Lakewood County BAN,
Series 1998-A
4.000% ........05/07/99 1,287 1,289
Lima Ohio, Lima
Memorial Hospital,
Series 1996 (B)
3.900% ........06/07/98 570 570
Lorain County Ohio Industrial
Development Authority Revenue
Bond, EMH Regional
Medical Center (B)
3.900% ........06/07/98 1,385 1,385
Mason City School
District, BAN
Series A
4.020% ........02/18/99 750 752
Mayfield City School
District, Ohio BAN
4.000% ........04/22/99 650 651
Ohio Air Quality Development
Authority Revenue, (A) (B)
Series 1985-A
4.000% ........06/01/98 1,000 1,000
Series 1985-B
4.000% ........06/01/98 3,300 3,300
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
OHIO -- CONTINUED
Ohio State Air Quality Development
Authority Revenue Bonds, Ohio
Edison Project, Series A
3.950% ........02/01/99 $ 3,000 $ 3,000
Ohio State Building Authority
Revenue Bond, Correctional
Facility, Series A
7.150% ........03/01/99 1,500 1,539
7.250% ........03/02/99 1,500 1,569
Ohio State Higher Education
Facilities Revenue Bond,
Mount Union College (B)
3.850% ........06/07/98 910 910
Ohio State Public
Facilities Commission
4.250% ........06/01/99 250 250
Ohio State University
General Receipts
Series 1986-B (B)
3.750% ........06/07/98 10,000 10,000
3.800% ........06/07/98 3,890 3,890
4.200% ........06/07/98 4,000 4,000
Ross County Ohio Hospital
Facilities Revenue Bond,
Medical Center Hospital Project (B)
3.850% ........06/07/98 450 450
Scioto County, Hospital Facilities
Revenue Bond, VHA Central
Capital Asset Finance Program,
(B) (AMBAC) Series B
3.750% ........06/07/98 250 250
Series G
3.750% ........06/07/98 800 800
Scioto County, V.H.A. Central
Capital Asset Financing Program,
(B) (AMBAC) Series E
3.750% ........06/07/98 590 590
Series F
3.750% ........06/07/98 1,550 1,550
See Accompanying Notes
18
<PAGE>
STATEMENT OF NET ASSETS
ARMADA TAX EXEMPT MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
OHIO -- CONTINUED
Scioto County, V.H.A. Central
Income Capital Asset,
Series 1985-C (B) (AMBAC)
3.750% ........06/07/98 $ 815 $ 815
State of Ohio Higher Education
Facility Authority Revenue Bond,
Oberlin College Project,
Series 1985 (A) (B)
3.850% ........06/07/98 9,000 9,000
Summit County, Series A, TECP
4.500% ........06/04/98 8,000 8,000
4.875% ........11/19/98 2,000 2,010
Summit County, BAN
4.250% ........06/13/99 8,000 8,055
Toledo City Services Special
Assessment Notes (B)
3.800% ........06/07/98 6,220 6,220
Toledo GO
4.000% ........10/15/98 2,845 2,850
Upper Arlington City, TECP
Series 1998
3.600% ........10/15/98 1,200 1,202
-----------
104,152
-----------
PENNSYLVANIA -- 2.2%
Delaware County, IDA/PECO
3.700% ........06/01/98 4,000 4,000
Quakertown Hospital Authority
Revenue Bond, HPS Group
Pooled Financing (A) (B)
3.850% ........06/07/98 1,200 1,200
Temple University Higher Education
of Pennsylvania Revenue Bond
3.780% ........05/14/99 1,000 1,000
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
PENNSYLVANIA -- CONTINUED
Washington County Authority
Lease Revenue Bond,
Series 1985 (A) (B)
3.950% ........06/07/98 $5,730 $ 5,730
-----------
11,930
-----------
TENNESSEE -- 3.0%
Vanderbilt University Health &
Education, Nashville &
Davidson, TECP
3.400% ........06/19/98 3,700 3,700
3.600% ........06/24/98 1,000 1,000
3.600% ........06/26/98 2,000 2,000
3.400% ........07/15/98 3,010 3,010
3.650% ........07/28/98 3,000 3,000
3.800% ........07/28/98 4,140 4,140
-----------
16,850
-----------
TEXAS -- 6.3%
Angelina & Neches River Authority
Industrial Development Solid
Waste Disposal Revenue Bond,
Teec, Inc. Temple-Inland,
Series B (A) (B)
4.000% ........06/01/98 4,600 4,600
Series C (A) (B)
3.746% ........06/01/98 2,200 2,200
Gulf Coast, Industrial Development
Authority Revenue Bond,
Amoco Oil Project
3.800% ........06/01/98 2,500 2,500
Red River Authority of Texas
Pollution Control Revenue Bond,
Southwestern Public Service
Company Project (B)
4.050% ........06/07/98 16,600 16,600
See Accompanying Notes
19
<PAGE>
STATEMENT OF NET ASSETS
ARMADA TAX EXEMPT MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
TEXAS -- CONTINUED
Texas TRAN, Series A
4.750% ........08/31/98 $8,900 $ 8,921
-----------
34,821
-----------
UTAH -- 6.6%
Emery County Pollution Control
Revenue Bond, Pacificorp Project (B)
3.900% ........06/07/98 2,700 2,700
Intermountain Power Agency Power
Supply,TECP
3.450% ........06/15/98 5,000 5,000
3.600% ........08/21/98 1,800 1,800
3.550% ........08/28/98 3,700 3,700
Series 1985
3.650% ........09/15/98 1,000 1,000
Salt River Project Agricultural
Improvement & Power District,
TECP
3.350% ........06/11/98 2,000 2,000
Utah State, TECP
3.750% ........09/30/98 4,000 4,000
3.600% ........09/30/98 4,000 4,000
3.650% ........10/08/98 2,000 2,000
Series A
3.500% ........07/10/98 2,000 2,000
Series B
3.600% ........07/07/98 5,000 5,000
Utah University Auxiliary and
Campus Facilities Revenue
Bond, Series 97-A (B)
3.850% ........06/07/98 3,000 3,000
-----------
36,200
-----------
VIRGINIA -- 3.3%
Commonwealth of Virginia, TECP
3.750% ........06/05/98 1,000 1,000
Series 1997
3.450% ........07/31/98 4,000 4,000
3.350% ........08/28/98 3,000 3,000
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
VIRGINIA -- CONTINUED
Fairfax County TECP
3.850% ........06/03/98 $2,000 $ 2,000
Lynchburg Industrial Development
Authority, Hospital Facilities
Revenue Bond, Mid-Atlantic
States Capital Asset Finance
Project, Series 1985-G (B) (AMBAC)
3.800% ........06/07/98 2,000 2,000
Richmond GO
6.500% ........01/16/99 1,000 1,027
Roanoke Industrial Development
Authority Revenue Bond, Carilion
Health System, Series B (B)
4.000% ........06/01/98 5,500 5,500
-----------
18,527
-----------
WASHINGTON -- 0.9%
Washington Health Care
Facility Authority Revenue
Bond, Fred Hutchinson
Cancer Research Center, (A) (B)
Series 1991-A
3.950% ........06/01/98 1,000 1,000
Series 1991-B
3.950% ........06/01/98 3,800 3,800
-----------
4,800
-----------
WISCONSIN -- 3.2%
Oak Creek Pollution Control
Revenue Bond, Wisconsin
Electric Power Company Project (B)
3.950% ........06/07/98 3,300 3,300
Wisconsin State, TECP
3.400% ........06/15/98 4,060 4,060
3.400% ........06/15/98 2,314 2,314
3.500% ........07/09/98 4,160 4,160
3.550% ........08/21/98 3,808 3,808
-----------
17,642
-----------
See Accompanying Notes
20
<PAGE>
STATEMENT OF NET ASSETS
ARMADA TAX EXEMPT MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
WYOMING -- 2.2%
Sublette County, Pollution Control
Revenue Bond, Wyoming Exxon
Project, Series 84 Credit
Support (B)
4.000% ........06/01/98 $3,050 $ 3,050
Sweetwater County, Pollution
Control Revenue Bond,
Pacificorp Project 84 (B)
3.950% ........06/01/98 1,900 1,900
Sweetwater County, Pollution
Control Revenue Bond, Pacificorp
Project (B) (AMBAC)
3.950% ........06/01/98 1,700 1,700
Sweetwater, TECP
3.800% ........06/23/98 3,400 3,400
Uinta County, Pollution Control
Refunding Revenue Bond (B)
3.950% ........06/01/98 2,000 2,000
-----------
12,050
-----------
TOTAL MUNICIPAL BONDS
(Cost $545,025) .................... 554,025
-----------
CASH EQUIVALENTS -- 0.3%
Federated Tax-Free
Money Market Fund ........... 347 347
Financial Square Tax Exempt
Money Market Fund ........... 1,100 1,100
-----------
TOTAL CASH EQUIVALENTS
(Cost $1,447) ...................... 1,447
-----------
TOTAL INVESTMENTS -- 100.7%
(Cost $554,025) .................... $ 555,472
===========
OTHER ASSETS AND LIABILITIES,
NET-- (0.7%) ....................... (3,971)
-----------
VALUE
(000)
-----
NET ASSETS:
Portfolio Shares of Institutional
(unlimited authorization -- no
par value) based on 419,030,122
outstanding shares of
beneficial interest ................ $418,963
Portfolio Shares of Retail Class
(unlimited authorization -- no par
valie) based on 132,535,736
outstanding shares of
beneficial interest ................ 132,516
Accumulated net realized gain
on investments ..................... 22
-----------
TOTAL NET ASSETS-- 100.0% ............. $ 551,501
===========
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE--
INSTITUTIONAL CLASS ................ $1.00
===========
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER
SHARE -- RETAIL CLASS .............. $1.00
===========
- -----------------
(A) SECURITIES BACKED BY A LETTER OF CREDIT BACKED BY A MAJOR FINANCIAL
INSTITUTION.
(B) VARIABLE RATE SECURITIES -- THE RATE REFLECTED ON THE STATEMENT OF NET
ASSETS IS THE RATE IN EFFECT ON MAY 31, 1998.
AMBAC -- AMERICAN MUNICIPAL BOND ASSURANCE CORPORATION
BAN -- BOND ANTICIPATION NOTE
GO -- GENERAL OBLIGATION
MBIA -- MUNICIPAL BOND INSURANCE ASSOCIATION
TECP -- TAX EXEMPT COMMERCIAL PAPER
TRAN -- TAX AND REVENUE ANTICIPATION NOTE
See Accompanying Notes
21
<PAGE>
FINANCIAL HIGHLIGHTS
ARMADA TAX EXEMPT MONEY MARKET FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
FOR THE YEAR ENDED MAY 31,
-----------------------------------------------------------------------------------------------
1998 1997 1996 1995
--------------------- --------------------- --------------------- ---------------------
INSTITUTIONAL RETAIL INSTITUTIONAL RETAIL INSTITUTIONAL RETAIL INSTITUTIONAL RETAIL
------------- ------ ------------- ------ ------------- ------ ------------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning
of period .......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
----------- -------- --------- ------- -------- ------- -------- -------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03
LESS DISTRIBUTIONS
Dividends from net
investment income . (0.03) (0.03) (0.03) (0.03) (0.03) (0.03) (0.03) (0.03)
----------- -------- --------- ------- -------- ------- -------- -------
Net asset value, end of
period ............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=========== ======== ========= ======= ======== ======= ======== =======
TOTAL RETURN 3.40% 3.27% 3.23% 3.12% 3.40% 3.29% 3.14% 3.04%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(in 000's) ........ $ 418,953 $132,548 $370,679 $71,917 $261,808 $85,928 $172,643 $51,916
Ratio of expenses to
average net assets 0.30%1 0.42%2 0.29%1 0.39%2 0.30%1 0.40%2 0.35%1 0.46%2
Ratio of net investment
income to average
net assets ........ 3.32%1 3.20%2 3.18%1 3.08%2 3.33%1 3.23%2 3.15%1 3.17%2
FOR THE YEAR ENDED MAY 31,
----------------------
1994
---------------------
INSTITUTIONAL RETAIL
------------- ------
Net asset value, beginning
of period .......... $ 1.00 $ 1.00
------- -------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income 0.02 0.02
LESS DISTRIBUTIONS
Dividends from net
investment income . (0.02) (0.02)
------- -------
Net asset value, end of
period ............. $ 1.00 $ 1.00
======= =======
TOTAL RETURN 2.06% 1.96%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(in 000's) ........ $139,015 $17,819
Ratio of expenses to
average net assets 0.33%1 0.43%2
Ratio of net investment
income to average
net assets ........ 2.05%1 1.94%2
<FN>
1 THE OPERATING EXPENSE RATIO AND THE NET INVESTMENT INCOME RATIO BEFORE FEE
WAIVERS BY THE INVESTMENT ADVISERS FOR THE INSTITUTIONAL CLASS FOR THE YEARS
ENDED MAY 31, 1998 AND MAY 31, 1997 WOULD HAVE BEEN 0.50% AND 3.12% AND .49%
AND 2.98%, RESPECTIVELY. THE OPERATING EXPENSE RATIO AND NET INVESTMENT
INCOME RATIO BEFORE FEE WAIVERS BY THE INVESTMENT ADVISERS AND CUSTODIAN FOR
THE INSTITUTIONAL CLASS FOR THE YEARS ENDED MAY 31, 1996 AND 1995 WOULD HAVE
BEEN .51% AND 3.12% AND .56% AND 2.94%, RESPECTIVELY. THE OPERATING EXPENSE
RATIO AND THE NET INVESTMENT INCOME RATIO BEFORE FEE WAIVERS BY THE
INVESTMENT ADVISERS FOR THE INSTITUTIONAL CLASS FOR THE YEAR ENDED MAY 31,
1994 WOULD HAVE BEEN .53% AND 1.85%.
2 THE OPERATING EXPENSE RATIO AND THE NET INVESTMENT INCOME RATIO BEFORE FEE
WAIVERS BY THE INVESTMENT ADVISERS FOR THE RETAIL CLASS FOR THE YEARS ENDED
MAY 31, 1998 AND MAY 31, 1997 WOULD HAVE BEEN 0.62% AND 3.00% AND .59% AND
2.88%, RESPECTIVELY. THE OPERATING EXPENSE RATIO AND NET INVESTMENT INCOME
RATIO BEFORE FEE WAIVERS BY THE INVESTMENT ADVISERS AND CUSTODIAN FOR THE
RETAIL CLASS FOR THE YEARS ENDED MAY 31, 1996 AND 1995 WOULD HAVE BEEN .61%
AND 3.02% AND .67% AND 2.96%, RESPECTIVELY. THE OPERATING EXPENSE RATIO AND
NET INVESTMENT INCOME RATIO BEFORE FEE WAIVERS BY THE INVESTMENT ADVISERS
FOR THE RETAIL CLASS FOR THE YEAR ENDED MAY 31, 1994 WOULD HAVE BEEN .63%
AND 1.74%.
</FN>
</TABLE>
See Accompanying Notes
22
<PAGE>
STATEMENT OF NET ASSETS
ARMADA PENNSYLVANIA TAX EXEMPT MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- 96.4%
PENNSYLVANIA -- 96.4%
Adams County Note,
Series 1998
4.070% ........12/31/98 $1,000 $ 1,001
Allegheny County, Higher
Education Building Authority
Revenue Bond, University
of Pittsburgh Project,
Series 1985 B (B)
3.600% ........06/07/98 1,180 1,180
Allegheny County, Hospital
Development Authority
Revenue Bond, Health Center,
Presbyterian University
Health, Series D
5.000% ........11/01/98 500 503
4.100% (B) ....06/07/98 1,650 1,650
Allegheny County, Hospital
Development Authority Revenue
Bond, Health Center Development, TECP
3.450% ........07/24/98 1,200 1,200
Allegheny County, Hospital
Development Authority Revenue
Bond, St. Francis System (A) (B)
4.100% ........06/07/98 2,000 2,000
Allegheny County, PA Industrial
Development Authority,
USX Project
3.800% ........07/28/98 1,000 1,000
Beaver County, Industrial
Development Authority Revenue
Bond, Duquesne Power & Light,
Series B (B)
3.850% ........06/07/98 600 600
Beaver County, Industrial
Development Authority Revenue
Bond, Duquesne Power and Light
3.650% ........06/09/98 1,000 1,000
3.650% ........06/25/98 1,500 1,500
Series 1994
3.400% ........07/23/98 1,000 1,000
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
PENNSYLVANIA -- CONTINUED
Boyertown Area School District
General Obligation
Unlimited Bond, Series 1998
3.750% ........03/01/99 $ 480 $ 480
Brockway County, Pennsylvania
Area School District GO (FGIC)
3.850% ........05/15/99 125 125
Brookville, Pennsylvania Area
School District GO (FSA)
3.850% ........05/15/99 220 220
Series A
3.700% ..........11/15/98 270 270
Bucks County, Industrial
Development Authority
Revenue Bond, USX Corp.
Project, Series 1995 (A)
3.550% ........06/15/98 1,000 1,000
Bucks County, Pennsylvania
St. Mary Hospital Authority
Catholic Health Initiatives
Revenue Bond,
Series A (B)
3.750% ........12/01/98 215 215
Series B (B)
4.000% ........06/07/98 1,500 1,500
Bucks County, Water and Sewer
Authority Revenue Bond (FGIC)
5.350% ........12/01/98 100 101
Cheltenham TRAN
4.060% ........12/31/98 1,000 1,001
Coatesville City Water Authority
Revenue Bond, Series 1998 (FGIC)
3.650% ........10/01/98 295 295
College Township Industrial
Development Authority Revenue
Bond, Ball Corporation Project,
Series 1993 (A) (B)
4.150% ........06/07/98 2,200 2,200
See Accompanying Notes
23
<PAGE>
STATEMENT OF NET ASSETS
ARMADA PENNSYLVANIA TAX EXEMPT MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
PENNSYLVANIA -- CONTINUED
Dauphin County, Pennsylvania
General Authority Revenue
Bond, Series G
5.000% ........12/01/98 $ 100 $ 101
Delaware County, Industrial
Development Authority Revenue
Bond, General Electric
Corporation, Project,
Series 1997-G (B)
4.050% ........06/07/98 2,000 2,000
Delaware County, Industrial
Development Authority Revenue
Bond, Recovery Facility, Series G (B)
4.300% ........06/07/98 3,005 3,005
Delaware County, Industrial
Development Authority
Revenue Bond, Scott Paper
Company Project,
Series A (B)
4.150% ........06/07/98 500 500
Series 1984 A (A) (B)
4.150% ........06/07/98 2,900 2,900
Delaware County, Industrial
Development Authority
Revenue Bond, United Parcel
Service Project, Series 1985 (B)
3.950% ........06/01/98 2,800 2,800
Delaware County, Philadelphia
Electric Company
Pennsylvania TECP
3.700% ........07/06/98 2,000 2,000
3.600% ........07/30/98 1,100 1,100
Delaware Valley Finance
Authority Local Government
Revenue Bond, Series 1985-C (B)
4.000% ........06/07/98 1,500 1,500
East Stroudsburg Area School
District GO, Series 1998-A (FGIC)
4.500% ........11/15/98 715 718
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
PENNSYLVANIA -- CONTINUED
Emmaus General Authority
Revenue Bond, Pool Project,
Series F-11 (A) (B)
4.100% ........06/07/98 $ 250 $ 250
Series E-11 (A) (B)
4.100% ........06/07/98 100 100
Emmaus General Authority
Revenue Bond,
Subseries B-16 (A) (B)
4.150% ........06/07/98 400 400
Subseries G-9 (A) (B)
4.150% ........06/07/98 1,500 1,500
Subseries H-9 (B)
4.000% ........06/07/98 1,300 1,300
Erie Pennsylvania School
District GO
4.000% ........09/01/98 175 175
Everett Area School
District GO (FGIC)
3.850% ........10/01/98 40 40
Geisinger Authority Health
System Revenue Bond,
Series 1992-B (A) (B)
4.000% ........06/01/98 1,000 1,000
Gettysburg Pennsylvania
Municipal Authority Water
Revenue Bond
3.800% ........10/01/98 100 100
Lancaster College Higher
Education Authority
Revenue Bond, Franklin &
Marshall College Project,
Series 1997 (A) (B)
3.970% ........06/07/98 4,000 4,000
Lehigh County General Purpose
Revenue Bond, Lehigh
Valley Hospital, Series A (B)
3.650% ........06/01/98 2,900 2,900
See Accompanying Notes
24
<PAGE>
STATEMENT OF NET ASSETS
ARMADA PENNSYLVANIA TAX EXEMPT MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
PENNSYLVANIA -- CONTINUED
Mercersburg Boro General Purpose
Authority Revenue Bond,
Mercersburg College Project,
Series 1997 (A) (B)
3.850% ........06/07/98 $1,000 $ 1,000
Millcreek Township School
District GO
4.000% ........08/15/98 740 740
Montgomery County, Higher
Education and Health Authority
Revenue Bond, Series 1988
(AMBAC) (A) (B)
3.900% ........06/07/98 1,100 1,100
Montgomery County, PECO, TECP
3.750% ........08/14/98 1,500 1,500
Northeastern Hospital Authority
Revenue Bond, Hospital Center
Services Capital Asset Project
3.200% ........06/26/98 1,000 1,000
Pennsylvania State Educational
Facilities Revenue Bond,
Series K (AMBAC)
4.000% ........06/15/98 100 100
Pennsylvania State Higher Educational
Facilities Authority Refunding
Revenue Bond ,Carnegie
Mellon University Project,
Series 1995C (A) (B)
4.000% ........06/01/98 600 600
Series C, (B)
4.000% ........06/01/98 2,200 2,200
Pennsylvania State Housing Finance
Agency Single Family
Mortgage Revenue Bond,
Series 29
6.500% ........10/01/98 100 101
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
PENNSYLVANIA -- CONTINUED
Pennsylvania State Educational
System Revenue Bond,
Pennsylvania State University
Project, Series 98A
4.500% ........03/30/99 $1,200 $ 1,209
Pennsylvania State GO,
Series 1997A
3.650% ........07/16/98 2,000 2,000
3.650% ........08/25/98 1,900 1,900
Series A
6.500% ........06/01/98 1,200 1,200
6.750% ........11/01/98 500 506
Pennsylvania State Higher
Education Revenue Bond,
Allegheny College Project (A) (B)
3.950% ........06/07/98 1,750 1,750
Pennsylvania State Higher
Education Revenue Bond,
Carnegie Mellon Project,
Series 1995-B (A) (B)
4.000% ........06/01/98 1,900 1,900
Pennsylvania State Higher
Education Revenue Bond,
Drexel University Project (A)
4.500% ........08/01/98 175 175
Pennsylvania State Higher
Education Revenue Bond,
University of Pennsylvania
Health Services Project,
Series C (A) (B)
4.050% ........06/07/98 1,800 1,800
Pennsylvania State TAN
4.500% ........06/30/98 2,000 2,001
Pennsylvania State Temple
University Funding Obligation
Revenue Bond, Series B
4.500% ........05/14/99 1,000 1,007
See Accompanying Notes
25
<PAGE>
STATEMENT OF NET ASSETS
ARMADA PENNSYLVANIA TAX EXEMPT MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
PENNSYLVANIA -- CONTINUED
Pennsylvania State Temple
University, Series A (FHA)
7.250% ........08/01/98 $ 500 $ 502
Pennsylvania State University
Revenue Bond
4.600% ........08/15/98 300 301
Series 92B
4.600% ........08/15/98 200 200
Pennsylvania State,
Series 1997a TECP
3.650% ........07/15/98 1,000 1,000
Philadelphia Gas Works TECP
3.750% ........06/24/98 2,600 2,600
Philadelphia Hospital &
Higher Educational Facility
Authority Revenue Bond,
(Children's Hospital Project
Series 1992 B (B)
4.000% ........06/01/98 3,400 3,400
Series 1996-A (A) (B)
3.750% ........06/01/98 1,600 1,600
Philadelphia Industrial Development
Authority Revenue Bond, The Fox
Chase Cancer Center Project,
Series 1997 (A) (B)
3.750% ........06/01/98 1,700 1,700
Philadelphia PA Authority
Industrial Development
Revenue Chemical Heritage
Foundation Project (B)
1.500% ........06/07/98 1,000 1,000
Philadelphia School
District TRAN (A)
4.500% ........06/30/98 4,100 4,100
Quakertown General Authority
Revenue Bond, Series A (A) (B)
3.850% ........06/07/98 3,340 3,340
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
PENNSYLVANIA -- CONTINUED
Sayre Health Care Facility
Authority Revenue Bond,
Capital Asset Finance
Group, (AMBAC) (B)
4.100% ........06/07/98 $2,000 $ 2,000
Scranton - Lackawanna Health
and Welfare Authority Revenue
Bond, University of
Scranton Project, (A)
3.850% ........11/01/98 1,715 1,715
Seneca Valley School District
GO, Series 1998-A (FGIC) (B)
3.850% ........02/15/99 370 370
Somerset County, General
Authority Commonwealth
Lease Revenue Bond
6.250% ........10/15/98 100 101
State Public School Building
Authority Revenue Bond,
Allegheny County Project,
Series E (MBIA)
3.750% ........11/01/98 520 520
State Public School Building
Authority Revenue Bond,
Cornell School District Project,
Series B (MBIA)
3.800% ........09/01/98 230 230
Temple University of the
Commonwealth System of
Higher Education Revenue
Bond, Series A
6.800% ........08/01/98 500 503
University of Pittsburgh Higher
Education Revenue Bond,
University Capital Project,
Series 1989A (A) (B)
4.000% ........06/07/98 500 500
See Accompanying Notes
26
<PAGE>
STATEMENT OF NET ASSETS
ARMADA PENNSYLVANIA TAX EXEMPT MONEY MARKET FUND
MAY 31, 1998
PAR VALUE
MATURITY (000) (000)
-------- ----- -----
MUNICIPAL BONDS -- CONTINUED
PENNSYLVANIA -- CONTINUED
Washington County, Authority
Lease Revenue Bond,
Series 1985 (A) (B)
3.950% ........06/07/98 $ 740 $ 740
York County General Authority
Pooled Financing Revenue
Bond Series 1996 (A) (B)
3.850% ........06/07/98 3,600 3,600
York County, Industrial
Development Authority Revenue
Bond, Public Service Electric
and Gas Co. Project,
Series 1995-A (MBIA) (B)
3.950% ........06/07/98 600 600
----------
102,841
----------
TOTAL MUNICIPAL BONDS
(Cost $102,841) .................... 102,841
----------
CASH EQUIVALENTS -- 3.8%
Blackrock Pennsylvania Municipal
Money Market Fund ........ 1,600 1,600
Federated Pennsylvania
Cash Trust Fund .......... 2,412 2,412
----------
TOTAL CASH EQUIVALENTS
(Cost $4,012) ...................... 4,012
----------
TOTAL INVESTMENTS -- 100.2%
(Cost $106,853) .................... $ 106,853
------------
------------
OTHER ASSETS AND LIABILITIES,
NET-- (0.2%) ....................... (214)
----------
VALUE
(000)
-----
NET ASSETS:
Portfolio Shares of Institutional Class
(unlimited authorization -- no
par value) based on 73,249,438
outstanding shares of
beneficial interest ................ $ 73,249
Portfolio Shares of Retail Class
(unlimited authorization -- no par value)
based on 33,366,661 outstanding shares of
beneficial interest ................ 33,367
Undistributed net investment income . 36
Accumulated net realized loss
on investments ..................... (13)
----------
TOTAL NET ASSETS-- 100.0% ............. $ 106,639
==========
NET ASSET VALUE, OFFERING
AND REDEMPTION
PRICE PER SHARE --
INSTITUTIONAL CLASS ................ $1.00
==========
NET ASSET VALUE, OFFERING
AND REDEMPTION PRICE PER
SHARE -- RETAIL CLASS .............. $1.00
==========
----------------------
(A) SECURITIES BACKED BY A LETTER OF CREDIT BACKED BY A MAJOR FINANCIAL
INSTITUTION.
(B) VARIABLE RATE SECURITIES -- THE RATE REFLECTED ON THE STATEMENT OF NET
ASSETS IS THE RATE IN EFFECT ON MAY 31, 1998.
AMBAC-- AMERICAN MUNICIPAL BOND ASSURANCE CORPORATION
FGIC -- FEDERAL GUARANTY INSURANCE CORPORATION
FSA -- FINANCIAL SECURITY ASSURANCE
GO -- GENERAL OBLIGATION
MBIA-- MUNICIPAL BOND INSURANCE ASSOCIATION
TECP -- TAX EXEMPT COMMERCIAL PAPER
TAN-- TAX ANTICIPATION NOTE
TRAN -- TAX AND REVENUE ANTICIPATION NOTE
See Accompanying Notes
27
<PAGE>
FINANCIAL HIGHLIGHTS
ARMADA PENNSYLVANIA TAX EXEMPT MONEY MARKET FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
FOR THE YEAR ENDED MAY 31,
------------------------------------------
1998 19975 FOR THE FOR THE FOR THE
-------------------- --------------------- PERIOD ENDED PERIOD ENDED PERIOD ENDED
INSTITUTIONAL RETAIL INSTITUTIONAL RETAIL6 MAY 31, 19965 APRIL 30, 19965 APRIL 30, 19955
------------- ------ ------------- ------- ------------- --------------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period . $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------- ------- ------- ------- ------- ------- -------
INCOME FROM INVESTMENT OPERATIONS
Net investment income .............. 0.03 0.03 0.03 0.02 0.00 0.03 0.02
LESS DISTRIBUTIONS
Dividends from net investment income (0.03) (0.03) (0.03) (0.02) (0.00) (0.03) (0.02)
------- ------- ------- ------- ------- ------- -------
Net asset value, end of period ....... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======= ======= ======= ======= ======= ======= =======
TOTAL RETURN ......................... 3.41% 3.29% 3.26% 3.18% 0.28%4 3.36% 2.32%4
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in 000's) $73,264 $33,375 $60,876 $20,830 $68,742 $70,422 $56,668
Ratio of expenses to average net assets 0.34%1 0.46%2 0.41%1 0.46%2,3 0.55%1,3 0.55%1 0.55%1,3
Ratio of net investment income to
average net assets 3.35%1 3.23%2 3.20%1 3.27%2,3 3.24%1,3 3.29%1 3.21%1,3
<FN>
1 THE OPERATING EXPENSE RATIO AND THE NET INVESTMENT INCOME RATIO BEFORE FEE
WAIVERS BY THE INVESTMENT ADVISER AND OTHER AFFILIATES FOR THE INSTITUTIONAL
CLASS FOR THE PERIODS ENDED MAY 31, 1998, MAY 31, 1997, MAY 31, 1996, APRIL
30, 1996, AND APRIL 30, 1995 WOULD HAVE BEEN 0.58% AND 3.11%, .74% AND
2.87%, .97% AND 2.82%, .96% AND 2.88%, AND 1.04% AND 2.72%, RESPECTIVELY.
2 THE OPERATING EXPENSE RATIO AND THE NET INVESTMENT INCOME RATIO BEFORE FEE
WAIVERS BY THE INVESTMENT ADVISER AND OTHER AFFILIATES FOR THE RETAIL CLASS
FOR THE YEARS ENDED MAY 31, 1998 AND MAY 31, 1997 WOULD HAVE BEEN 0.71% AND
2.98% AND .71% AND 3.02%, RESPECTIVELY.
3 ANNUALIZED.
4 NOT ANNUALIZED.
5 ACTIVITY FOR THE PERIOD PRESENTED INCLUDES THAT OF THE PREDECESSOR FUND
THROUGH SEPTEMBER 6, 1996. THE PREDECESSOR FUND COMMENCED OPERATIONS ON
AUGUST 10, 1994. DURING 1996, THE PREDECESSOR FUND CHANGED ITS FISCAL YEAR
END FROM APRIL 30 TO MAY 31.
6 RETAIL CLASS COMMENCED OPERATIONS ON SEPTEMBER 11, 1996.
</FN>
</TABLE>
See Accompanying Notes
28
<PAGE>
FINANCIAL STATEMENTS
ARMADA FUNDS MONEY MARKET SERIES
STATEMENT OF OPERATIONS (000)
FOR THE YEAR ENDED MAY 31, 1998
<TABLE>
<CAPTION>
PENNSYLVANIA
GOVERNMENT TREASURY TAX EXEMPT TAX EXEMPT
MONEY MARKET MONEY MARKET MONEY MARKET MONEY MARKET MONEY MARKET
FUND FUND FUND FUND FUND
------------- ------------ ------------ ------------ ------------
INVESTMENT INCOME:
<S> <C> <C> <C> <C> <C>
Interest ......................... $138,568 $62,752 $16,037 $17,905 $3,546
-------- ------- ------- ------- ------
EXPENSES:
Investment Advisory fees ......... 8,578 3,942 920 1,732 379
Administration fees .............. 662 307 84 217 42
Distribution fees ................ 530 277 85 93 3
12b-1 fees ....................... 936 406 101 209 39
Registration and filing fees ..... 132 126 3 43 6
Shareholder servicing fees-- Retail
Class only .................... 616 245 8 104 35
Custodian fees ................... 245 116 43 63 19
Professional fees ................ 301 126 30 38 13
Transfer Agent fees .............. 67 39 32 25 32
Trustees' fees ................... 72 24 8 9 2
Printing and shareholder reports . 118 53 8 10 5
Amortization of deferred
organization costs ............ -- -- 14 -- 3
Miscellaneous .................... 250 191 26 26 17
Fees waived by Investment Advisers (2,451) (1,126) (153) (990) (237)
-------- ------- ------- ------- ------
Total expenses ................... 10,056 4,726 1,209 1,579 358
-------- ------- ------- ------- ------
NET INVESTMENT INCOME ............... 128,512 58,026 14,828 16,326 3,188
-------- ------- ------- ------- ------
NET REALIZED GAIN/(LOSS) ON
INVESTMENTS SOLD ................ (4) (1) 8 10 (10)
-------- ------- ------- ------- ------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS ....... $128,508 $58,025 $14,836 $16,336 $3,178
======== ======= ======= ======= ======
</TABLE>
See Accompanying Notes
29
<PAGE>
FINANCIAL STATEMENTS
ARMADA FUNDS MONEY MARKET SERIES
STATEMENT OF CHANGES IN NET ASSETS (000)
<TABLE>
<CAPTION>
MONEY MARKET FUND GOVERNMENT MONEY MARKET FUND
------------------------------- -------------------------------
FOR THE YEAR ENDED MAY 31, FOR THE YEAR ENDED MAY 31,
------------------------------- -------------------------------
1998 1997 1998 1997
------------------------------- -------------------------------
INCREASE/(DECREASE) IN NET ASSETS:
Operations:
<S> <C> <C> <C> <C>
Net investment income ................... $ 128,512 $ 102,513 $ 58,026 $ 48,418
Net realized gain/(loss) on securities sold (4) (1) (1) --
---------- ---------- ---------- --------
Net increase in net assets resulting
from operations ......................... 128,508 102,512 58,025 48,418
---------- ---------- ---------- --------
Distributions to shareholders:
Net investment income:
Institutional ......................... (103,139) (85,505) (47,874) (40,861)
Retail ................................ (25,134) (17,008) (10,152) (7,557)
Class B ............................... -- -- -- --
Realized capital gains:
Institutional ......................... -- -- -- --
Retail ................................ -- -- -- --
Class B ............................... -- -- -- --
---------- ---------- ---------- --------
Total distributions ........................ (128,273) (102,513) (58,026) (48,418)
---------- ---------- ---------- --------
Share transactions:
Institutional
Proceeds from shares issued ........... 5,718,525 5,045,819 3,557,896 2,930,559
Reinvestment of cash distributions .... 1,914 24 176 423
Cost of shares redeemed ............... (5,751,937) (4,447,236) (3,233,359) (2,861,213)
---------- ---------- ---------- --------
Net Institutional share transactions (31,498) 598,607 324,713 69,769
---------- ---------- ---------- --------
Retail
Proceeds from shares issued ........... 2,079,077 1,653,855 614,377 434,038
Reinvestment of cash distributions .... 14,552 13,094 1,400 1,149
Cost of shares redeemed ............... (1,742,976) (1,663,864) (526,921) (407,252)
---------- ---------- ---------- --------
Net Retail share transactions ...... 350,653 3,085 88,856 27,935
---------- ---------- ---------- --------
Class B
Proceeds from shares issued ........... 6 -- -- --
Reinvestment of cash distributions .... -- -- -- --
Cost of shares redeemed ............... (1) -- -- --
---------- ---------- ---------- --------
Net Class B share transactions ..... 5 -- -- --
---------- ---------- ---------- --------
Increase/(decrease) in net assets from
share transactions ...................... 319,160 601,692 413,569 97,704
---------- ---------- ---------- --------
Total increase/(decrease) in net assets .... 319,395 601,691 413,568 97,704
---------- ---------- ---------- --------
NET ASSETS:
Beginning of period ..................... 2,289,192 1,687,501 970,791 873,087
---------- ---------- ---------- --------
End of period ........................... $2,608,587 $2,289,192 $1,384,359 $970,791
========== ========== ========== ========
TAX EXEMPT
TREASURY MONEY MARKET FUND MONEY MARKET FUND
----------------------------- ------------------------------
FOR THE YEAR ENDED MAY 31, FOR THE YEAR ENDED MAY 31,
----------------------------- ------------------------------
1998 1997 1998 1997
----------------------------- ------------------------------
INCREASE/(DECREASE) IN NET ASSETS:
Operations:
<S> <C> <C> <C> <C>
Net investment income ................... $ 14,828 $ 15,208 $ 16,326 $ 12,103
Net realized gain/(loss) on securities sold 8 17 10 13
---------- ---------- -------- --------
Net increase in net assets resulting
from operations ......................... 14,836 15,225 16,336 12,116
---------- ---------- -------- --------
Distributions to shareholders:
Net investment income:
Institutional ......................... (14,531) (14,941) (13,748) (9,991)
Retail ................................ (297) (267) (2,665) (2,112)
Class B ............................... -- -- -- --
Realized capital gains:
Institutional ......................... -- (13) -- --
Retail ................................ -- (1) -- --
Class B ............................... -- -- -- --
---------- ---------- -------- --------
Total distributions ........................ (14,828) (15,222) (16,413) (12,103)
---------- ---------- -------- --------
Share transactions:
Institutional
Proceeds from shares issued ........... 1,565,848 1,140,870 881,569 631,572
Reinvestment of cash distributions .... 10 1 1 --
Cost of shares redeemed ............... (1,482,587) (1,176,801) (833,210) (522,712)
---------- ---------- -------- --------
Net Institutional share transactions 83,271 (35,930) 48,360 108,860
---------- ---------- -------- --------
Retail
Proceeds from shares issued ........... 14,124 31,457 381,022 334,988
Reinvestment of cash distributions .... 271 238 2,404 2,090
Cost of shares redeemed ............... (12,854) (30,371) (322,804) (351,091)
---------- ---------- -------- --------
Net Retail share transactions ...... 1,541 1,324 60,622 (14,013)
---------- ---------- -------- --------
Class B
Proceeds from shares issued ........... -- -- -- --
Reinvestment of cash distributions .... -- -- -- --
Cost of shares redeemed ............... -- -- -- --
---------- ---------- -------- --------
Net Class B share transactions ..... -- -- -- --
---------- ---------- -------- --------
Increase/(decrease) in net assets from
share transactions ...................... 84,812 (34,606) 108,982 94,847
---------- ---------- -------- --------
Total increase/(decrease) in net assets .... 84,820 (34,603) 108,905 94,860
---------- ---------- -------- --------
NET ASSETS:
Beginning of period ..................... 282,007 316,610 442,596 347,736
---------- ---------- -------- --------
End of period ........................... $ 366,827 $ 282,007 $551,501 $442,596
========== ========== ======== ========
PENNSYLVANIA TAX EXEMPT
GOVERNMENT MONEY MARKET FUND
--------------------------------
FOR THE YEAR ENDED MAY 31,
--------------------------------
1998 19971
--------------------------------
INCREASE/(DECREASE) IN NET ASSETS:
Operations:
<S> <C> <C>
Net investment income ................... $ 3,188 $ 2,410
Net realized gain/(loss) on securities sold (10) --
-------- -------
Net increase in net assets resulting
from operations ......................... 3,178 2,410
-------- -------
Distributions to shareholders:
Net investment income:
Institutional ......................... (2,280) (2,146)
Retail ................................ (872) (264)
Class B ............................... -- --
Realized capital gains:
Institutional ......................... -- --
Retail ................................ -- --
Class B ............................... -- --
-------- -------
Total distributions ........................ (3,152) (2,410)
-------- -------
Share transactions:
Institutional
Proceeds from shares issued ........... 171,384 180,573
Reinvestment of cash distributions .... -- 23
Cost of shares redeemed ............... (159,015) (188,192)
-------- -------
Net Institutional share transactions 12,369 (7,596)
-------- -------
Retail
Proceeds from shares issued ........... 127,747 59,050
Reinvestment of cash distributions .... 295 53
Cost of shares redeemed ............... (115,504) (38,273)
-------- -------
Net Retail share transactions ...... 12,538 20,830
-------- -------
Class B
Proceeds from shares issued ........... --
Reinvestment of cash distributions .... --
Cost of shares redeemed ............... --
-------- -------
Net Class B share transactions ..... --
-------- -------
Increase/(decrease) in net assets from
share transactions ...................... 24,907 13,234
-------- -------
Total increase/(decrease) in net assets .... 24,933 13,234
-------- -------
NET ASSETS:
Beginning of period ..................... 81,706 68,472
-------- -------
End of period ........................... $106,639 $81,706
======== =======
<FN>
1 ACTIVITY FOR THE YEAR ENDED MAY 31, 1997 INCLUDES THAT OF THE PREDECESSOR FUND
THROUGH SEPTEMBER 6, 1996.
</FN>
</TABLE>
See Accompanying Notes
30 & 31
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. FUND ORGANIZATION
Armada Funds (the "Trust") is registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as an open-end management investment company.
The Trust was organized as a Massachusetts business trust on January 28, 1986.
The Trust is a series of twenty-three funds each of which is authorized to issue
two classes of shares designated as Institutional and Retail Shares. Effective
January 1, 1998 the Equity Growth, Equity Income, Small Cap Value, Small Cap
Growth, Core Equity, International Equity, Intermediate Bond, Bond and Money
Market Funds additionally began offering a third class of shares designated as B
Shares. Each share class represents an interest in the same portfolio of
investments of the respective Fund and is substantially the same in all
respects, except that the classes are subject to different distribution and/or
shareholder service fees and investment minimums. B Shares are sold with a
contingent deferred sales charge which may be reduced or waived under certain
circumstances.
The Trust currently has four Series that consist of the following Funds:
Money Market Series
Money Market Fund, Government Money Market Fund, Treasury Money Market Fund, Tax
Exempt Money Market Fund and Pennsylvania Tax Exempt Money Market Fund;
Equity Series
International Equity Fund, Small Cap Growth Fund, Small Cap Value Fund, Equity
Growth Fund, Core Equity Fund, Equity Income Fund, Equity Index Fund and Tax
Managed Equity Fund;
Tax Exempt Series
Ohio Tax Exempt Fund, Pennsylvania Municipal Fund and National Tax Exempt Fund;
Income Series
Total Return Advantage Fund, Intermediate Bond Fund, Enhanced Income Fund, GNMA
Fund, Bond Fund, Real Return Advantage Fund and Balanced Allocation Fund.
As of the date of this report, the Equity Index, Balanced Allocation and Real
Return Advantage Funds have not commenced operations.
Effective November 19, 1997, the names of the Armada Government, Treasury,
Tax Exempt and Pennsylvania Tax Exempt Funds were changed to the Armada
Government Money Market, Treasury Money Market, Tax Exempt Money Market and the
Pennsylvania Tax Exempt Money Market Funds, respectively.
FUND REORGANIZATION: On May 3, 1996, Integra Financial Corporation ("Integra
Financial") merged into National City Corporation ("National City"). Integra
Trust Company, an affiliate of Integra Financial, served as Investment Adviser
to Inventor Funds, Inc. ("Inventor").
As part of the Reorganization, on September 9, 1996, the Inventor
Pennsylvania Tax Exempt Money Market Fund (the "Predecessor Fund") transferred
all of its assets and liabilities with an approximate value of $74,142,677 in
exchange for shares of the Armada Pennsylvania Tax Exempt Fund. The
Reorganization was executed as a tax-free reorganization in accordance with
Section 368(a)(1)(F) of the Internal Revenue Code of 1986, as amended (the
"Internal Revenue Code"). The results of operations, changes in net assets and
financial highlights of the Armada Pennsylvania Tax Exempt Fund for the year
ended May 31, 1997 include those of the Predecessor Fund.
In accordance with provisions of the Reorganization Agreement, the Trust and
Inventor were each responsible for the payment of their own expenses incurred
in connection with the Reorganization to the extent not borne by their
respective Investment Advisers. Accordingly, the Trust recognized approximately
$200,000 in costs connected with the Reorganization, which has been allocated
among the various funds in the Trust.
32
<PAGE>
NOTES TO FINANCIAL STATEMENTS
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by the
Money Market, Government Money Market, Treasury Money Market, Tax Exempt Money
Market, and Pennsylvania Tax Exempt Money Market Funds (the "Funds") in
preparation of their financial statements.
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts and disclosures in the financial statements. Actual
results could differ from those estimates.
The Pennsylvania Tax Exempt Money Market Fund has invested substantially all
of its assets in the municipal obligations of that state. The Tax Exempt Money
Market Fund invests in municipal obligations of various states which may, at
times, comprise concentrations in one or several states. Economic changes
affecting the states and certain of their public bodies and municipalities may
affect the ability of issuers within each state to pay interest on, or repay
principal of, municipal obligations held by the Pennsylvania Tax Exempt Money
Market and Tax Exempt Money Market Funds. Many municipalities insure repayment
for their obligations. Although bond insurance reduces the risk of loss due to
default by an issuer, such bonds remain subject to the risk that the market may
fluctuate for other reasons and there is no assurance that the insurance company
will meet its obligations. Insured securities have been identified in the
Statement of Net Assets.
PORTFOLIO VALUATION: Investment securities in the Money Market, Government
Money Market, Treasury Money Market, Tax Exempt Money Market and Pennsylvania
Tax Exempt Money Market Funds are valued twice daily for processing subscription
and redemption orders. Investment securities are valued on the basis of
amortized cost which has been determined by the Board of Trustees to represent
the fair value of the Funds' investments. Amortized cost valuation involves
valuing an instrument at its cost initially and, thereafter, assuming a constant
rate of amortization to maturity of any applicable discount or premium.
SECURITY TRANSACTIONS AND INVESTMENT INCOME: Security transactions are
recorded on the trade date. Realized gains and losses on investments sold are
recorded on the identified cost basis. Interest income is accrued on a daily
basis. Expenses common to all the Funds in the Trust are allocated among them.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS: Each Fund declares dividends
daily from net investment income and pays such dividends no later than five
business days after the end of the month. Net investment income of the Money
Market, Government Money Market, and Treasury Money Market Funds consists of
interest accrued and discount earned (including both original issue and market
discount), less amortization of any market premium and accrued expenses. Net
investment income of the Tax Exempt Money Market and Pennsylvania Tax Exempt
Money Market Funds consists of interest accrued, original issue discount earned,
less amortization of any market premium and accrued expenses.
FEDERAL INCOME TAXES: Each of the Funds is classified as a separate taxable
entity for Federal income tax purposes. Each of the Funds intends to qualify as
a separate "regulated investment company" under the Internal Revenue Code and
make the requisite distributions to its shareholders that will be sufficient to
relieve it from Federal income tax and Federal excise tax. Therefore, no Federal
tax provision is required. To the extent that distributions from net investment
income and net realized capital gains exceed amounts in the financial
statements, such amounts are reported separately. At May 31, 1998, the total
cost of securities and the net realized gains or losses on securities sold for
Federal income tax purposes was not materially different from amounts reported
for financial reporting purposes. For the fiscal year ended May 31, 1998,
distributions were: Tax Exempt Money Market Fund 100% tax exempt income;
Pennsylvania Tax Exempt Money Market Fund 100% tax exempt income.
33
<PAGE>
NOTES TO FINANCIAL STATEMENTS
REPURCHASE AGREEMENTS: Repurchase agreements are considered loans under the
1940 Act. In connection therewith, the Trust's Custodian receives and holds
collateral of not less than 102% of the repurchase price plus accrued interest.
If the value of the collateral falls below this amount, the Trust 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
repurchase obligation, the Trust maintains the right to sell the underlying
securities at market value and may claim any resulting loss against the seller.
ORGANIZATIONAL COSTS: The Trust bears all costs in connection with its
organization, including the fees and expenses of registering and qualifying its
shares for distribution under Federal and State securities regulations. All
organization expenses incurred through June 30, 1998 are being amortized on a
straight-line basis over a period of five years from the date of commencement of
operations. In accordance with AICPA Statement of Position 98-5, "Reporting on
the Costs of Start-Up Activities", any organization expenses incurred subsequent
to June 30, 1998 will be expensed as incurred. 3. INVESTMENT ADVISER,
DISTRIBUTION FEE AND OTHER RELATED PARTY TRANSACTIONS
Fees paid by the Trust pursuant to the Advisory Agreements with National City
Bank, (the "Adviser"), a wholly-owned subsidiary of National City Corporation,
are payable monthly based on an annual rate of .35% of the average daily net
assets of each of the Money Market, Government Money Market and Tax Exempt Money
Market Funds, .30% of the average daily net assets of the Treasury Money Market
Fund, and .40% of the average daily net assets of the Pennsylvania Tax Exempt
Money Market Fund. Prior to the Reorganization, Integra Trust Company served as
investment adviser to the Pennsylvania Tax Exempt Money Market Fund and Weiss,
Peck & Greer LLC (the "Sub-Adviser") served as sub-adviser to Integra Trust
Company. Subsequent to the Reorganization, the Sub-Adviser continued to serve
under an agreement with National City Bank and was entitled to earn a fee
pursuant to such agreement. Effective October 1, 1997, the agreement with the
Sub-Adviser was terminated and the Adviser assumed full investment management
responsibilities. The Adviser may from time to time waive its fees payable by
the Funds. For the year ended May 31, 1998, the Adviser has earned and waived
the following fees:
EARNED WAIVED
(000) (000)
---------- -------
Money Market Fund................ $8,578 $2,451
Government Money Market Fund..... 3,942 1,126
Treasury Money Market Fund....... 920 153
Tax Exempt Money Market Fund..... 1,732 990
Pennsylvania Tax Exempt
Money Market Fund............. 379 237
At May 31, 1998, Advisory fees accrued and unpaid amounted to:
(000)
-------
Money Market Fund........................... $1,094
Government Money Market Fund................ 509
Treasury Money Market Fund.................. 370
Tax Exempt Money Market Fund................ 123
Pennsylvania Tax Exempt Money
Market Fund.............................. 45
The Trust maintains a Shareholder Services Plan (the "Services Plan") with
respect to the Retail shares in each of the Funds and B shares of the Money
Market Fund. Pursuant to the Retail Class and Class B Services Plans, the Trust
enters into shareholder servicing agreements with certain financial institutions
under which they agree to provide shareholder administrative services to their
customers who beneficially own Retail shares or B shares in consideration for
the payment of up to .15% on an annualized basis of the net asset value of the
Retail shares of the Money Market, Government Money Market, Treasury Money
Market, Tax Exempt Money Market and Pennsylvania Tax Exempt Money Market Funds
and on B shares of the Money Market Fund. Prior to January 1, 1998, fees
34
<PAGE>
NOTES TO FINANCIAL STATEMENTS
payable under the Services Plan were .10% on an annualized basis of the net
asset value. For the period ended May 31, 1998, fees paid under the Services
Plan to NatCity Investments, Inc. and National City Bank of Columbus,
wholly-owned subsidiaries of National City Corporation, amounted to:
NATIONAL CITY NATCITY
BANK OF COLUMBUS INVESTMENTS INC.
(000) (000)
----------------- --------------
Money Market Fund... $251 $365
Government Money
Market Fund....... 209 36
Treasury Money
Market Fund....... 1 7
Tax Exempt Money
Market Fund....... 34 70
Pennsylvania Tax Exempt
Money Market Fund. 33 2
National City Bank also serves as the Funds' Custodian. For the year ended
May 31, 1998, National City Bank earned custodian fees as follows:
(000)
-------
Money Market Fund........................... $245
Government Money Market Fund................ 116
Treasury Money Market Fund.................. 43
Tax Exempt Money Market Fund................ 63
Pennsylvania Tax Exempt Money
Market Fund.............................. 19
The Trust and SEI Investments Distribution Co., a wholly-owned subsidiary of
SEI Investments Company ("SEI" or "Distributor") are parties to a distribution
agreement dated May 1, 1998. The Distributor receives no fees for its
distribution services under this agreement.
440 Financial Distributors, Inc., ("440") a wholly-owned subsidiary of The
Shareholder Services Group, Inc. and an indirect wholly-owned subsidiary of
First Data Corp., served as the Trust's Distributor until March 7, 1997. Each
Fund reimbursed 440 for direct and indirect expenses incurred in performing
distribution services, up to a maximum of .10% per annum of the average net
assets of each Fund, inclusive of an annual fee of $250,000, which was allocated
among the investment funds for which 440 was distributing shares.
SEI served as distributor to the Pennsylvania Tax Exempt Money Market Fund
prior to the Reorganization. Under a Rule 12b-1 Distribution Plan, SEI earned
and waived fees at an annual rate of up to .25% of the average daily net assets
of the Predecessor Fund's Class A shares.
Each Trustee receives an annual fee of $15,000 plus $3,000 for each Board
meeting attended and reimbursement of out-of-pocket expenses. The Chairman of
the Board receives an additional $5,000 per annum for services in such capacity.
Such fees are paid for services rendered to all of the Funds and are allocated
accordingly. No person who is an officer, director, trustee, or employee of the
Advisers, Distributor, or of any parent or subsidiary thereof, who serves as an
officer, trustee, or employee of the Trust receives any compensation from the
Trust.
Expenses for the period ended May 31, 1998, include legal fees paid to
Drinker Biddle & Reath LLP. A partner of that firm is Secretary of the Trust.
The Trust and SEI Fund Resources (the "Administrator") are parties to an
Administration Agreement dated May 1, 1998, under which the Administrator
provides administrative services for an annual fee of .07% of the aggregate
average daily net assets of the Portfolios up to the first eighteen billion and
.06% of the aggregate average daily net assets of the Portfolios over eighteen
billion. Prior to May 2, 1998 PFPC Inc. ("PFPC") served as Administrator and
Accounting Agent to the Trust. As compensation for services performed, each Fund
paid PFPC an asset-based fee plus reimbursement of reasonable out-of-pocket
expenses.
4. SHARES OF BENEFICIAL INTEREST
The Trust's Declaration of Trust authorizes the Board of Trustees to issue an
unlimited number of shares of beneficial interest and to classify or reclassify
any unissued shares of the Trust into one or more additional classes of shares
and to classify or reclassify any class of shares into one or more series of
shares. Since the Funds have each sold and redeemed shares only at a constant
net asset value of $1.00 per share, the number of shares represented by such
sales, reinvestments, and redemptions is the same as the amounts shown on the
following pages for such transactions.
35
<PAGE>
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED
<TABLE>
<CAPTION>
MAY 31, 1998 (000) MAY 31, 1997 (000)
-------------------------------------------- ---------------------------
INSTITUTIONAL RETAIL INSTITUTIONAL RETAIL
CLASS CLASS CLASS B CLASS CLASS
---------------- ----------- --------- ------------- -----------
MONEY MARKET FUND
<S> <C> <C> <C> <C> <C>
Shares sold ......................... $ 5,718,525 $ 2,079,077 $ 5 $ 5,045,819 $ 1,653,855
Shares reinvested ................... 1,914 14,552 -- 24 13,094
Shares repurchased .................. (5,751,937) (1,742,976) (1) (4,447,236) (1,663,864)
----------- ----------- ----- ----------- -----------
Net increase ........................ $ (31,498) $ 350,653 $ 4 $ 598,607 $ 3,085
=========== =========== ===== =========== ===========
GOVERNMENT MONEY MARKET FUND
Shares sold ......................... $ 3,557,896 $ 614,377 $ -- $2,930,559 $ 434,038
Shares reinvested ................... 176 1,400 -- 423 1,149
Shares repurchased .................. (3,233,359) (526,921) $ -- (2,861,213) (407,252)
----------- ----------- ----- ----------- -----------
Net increase ........................ $ 324,713 $ 88,856 $ -- $ 69,769 $ 27,935
=========== =========== ===== =========== ===========
TREASURY MONEY MARKET FUND
Shares sold ......................... $ 1,565,848 $ 14,124 $ -- $ 1,140,870 $ 31,457
Shares reinvested ................... 10 271 -- 1 238
Shares repurchased .................. (1,482,587) (12,854) $ -- (1,176,801) (30,371)
----------- ----------- ----- ----------- -----------
Net increase/(decrease) ............. $ 83,271 $ 1,541 $ -- $ (35,930) $ 1,324
=========== =========== ===== =========== ===========
TAX EXEMPT MONEY MARKET FUND
Shares sold ......................... $ 881,569 $ 381,021 $ -- $ 631,572 $ 334,988
Shares reinvested ................... 1 2,404 -- -- 2,090
Shares repurchased .................. (833,210) (322,804) $ -- (522,712) (351,092)
----------- ----------- ----- ----------- -----------
Net increase/(decrease) ............. $ 48,360 $ 60,621 $ -- $ 108,860 $ (14,014)
=========== =========== ===== =========== ===========
PENNSYLVANIA TAX EXEMPT
MONEY MARKET FUND
Shares sold ......................... $ 171,384 $ 127,747 $ -- $ 180,573 $ 59,050
Shares reinvested ................... -- 295 -- 23 53
Shares repurchased .................. (159,015) (115,504) $ -- (188,192) (38,273)
----------- ----------- ----- ----------- -----------
Net increase/(decrease) ............. $ 12,369 $ 12,538 $ -- $ (7,596) $ 20,830
=========== =========== ===== =========== ===========
</TABLE>
36
<PAGE>
REPORT OF INDEPENDENT AUDITORS
To the Board of Trustees and
Shareholders of Armada Funds
We have audited the accompanying statements of net assets of the Armada Money
Market Fund, Armada Government Money Market Fund, Armada Treasury Money Market
Fund, Armada Tax Exempt Money Market Fund and Armada Pennsylvania Tax Exempt
Money Market Fund (the "Funds") as of May 31, 1998, and the related statements
of operations and changes in net assets for the periods presented therein. We
have also audited the financial highlights for each of the periods presented
herein for the Armada Money Market Fund, Armada Government Money Market Fund,
Armada Treasury Money Market Fund, and Armada Tax Exempt Money Market Fund, and
for the years ended May 31, 1998 and May 31, 1997 presented herein for the
Armada Pennsylvania Tax Exempt Money Market Fund. These financial statements and
financial highlights are the responsibility of the Funds' management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits. The financial highlights for the
periods ended April 30, 1995 through May 31, 1996 for the Armada Pennsylvania
Tax Exempt Money Market Fund were audited by other auditors whose report dated
July 26, 1996 expressed an unqualified opinion on those financial highlights.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements and financial highlights. Our procedures included verification by
examination of securities held by the custodian, as of May 31, 1998, and
confirmation of securities not held by the custodian, by correspondence with
brokers. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the 1998 financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
each of the respective Funds at May 31, 1998, and the results of their
operations and changes in their net assets for the periods presented herein and
for the Armada Money Market Fund, Armada Government Money Market Fund, Armada
Treasury Money Market Fund, and Armada Tax Exempt Money Market Fund, the
financial highlights for each of the periods presented herein, and for the
Armada Pennsylvania Tax Exempt Money Market Fund, the financial highlights for
the years ended May 31, 1998 and May 31, 1997 presented herein, in conformity
with generally accepted accounting principles.
/S/ SIGNATURE
ERNST & YOUNG LLP
Philadelphia, Pennsylvania
July 20, 1998
37
<PAGE>
NOTES
38
<PAGE>
NOTES
39
<PAGE>
NOTES
40
<PAGE>
ARMADA FUNDS
BOARD OF TRUSTEES
ROBERT D. NEARY
CHAIRMAN
Retired Co-Chairman, Ernst & Young
Director:
Cold Metal Products, Inc.
Zurn Industries, Inc.
HERBERT R. MARTENS, JR.
PRESIDENT
Executive Vice President,
National City Corporation
Chairman, President and Chief Executive
Officer, NatCity Investments,Inc.
LEIGH CARTER
Retired President and Chief Operating
Officer, B.F. Goodrich Company
Director:
Kirtland Capital Corporation
Morrison Products
JOHN F. DURKOTT
President and Chief Operating Officer,
Kittle's Home Furnishings Center, Inc.
ROBERT J. FARLING
Retired Chairman, President and
Chief Executive Officer, Centerior Energy
Director:
Republic Engineered Steels
RICHARD W. FURST, DEAN
Professor of Finance and Dean
Carol Martin Gatton College of Business
and Economics, University of Kentucky
Director:
Foam Design, Inc.
The Seed Corporation
GERALD L. GHERLEIN
Executive Vice President and General
Counsel, Eaton Corporation
Trustee:
WVIZ Educational Television
J. WILLIAM PULLEN
President and Chief Executive Officer,
Whayne Supply Company
<PAGE>
[ARMANDA FUNDS LOGO OMITTED]
Oaks, Pennsylvania 19456
Marlborough, Massachusetts 01752
INVESTMENT ADVISER
AFFILIATE OF
NATIONAL CITY
CORPORATION
National City Bank
1900 East Ninth Street
Cleveland, Ohio 44114
National City Bank, Columbus
155 East Broad Street
Columbus, Ohio 43251
National City Bank, Kentucky
101 South Fifth Street
Louisville, Kentucky 40202
AF-803 (7/98)
---------------
BULK RATE
U.S. POSTAGE
PAID
CLEVELAND, OH
PERMIT NO. 1535
---------------
