ANNUAL REPORT
October 31, 2000
GALAXY FUNDS
GALAXY EQUITY FUNDS
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GALAXY ASSET ALLOCATION FUND
GALAXY EQUITY INCOME FUND
GALAXY GROWTH AND INCOME FUND
GALAXY STRATEGIC EQUITY FUND
GALAXY EQUITY VALUE FUND
GALAXY EQUITY GROWTH FUND
GALAXY GROWTH FUND II
GALAXY SMALL CAP VALUE FUND
GALAXY SMALL COMPANY EQUITY FUND
GALAXY INTERNATIONAL EQUITY FUND
GALAXY PAN ASIA FUND
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GALAXY LOGO
BLACK
<PAGE>
Chairman's Message
Dear Shareholder:
Enclosed is the annual report for the Galaxy Equity Funds for the fiscal
year ended October 31, 2000. The report includes a Market Overview that explains
the different economic and market factors influencing stock investments during
this time. Following the Market Overview are individual reviews that describe
how Fleet Investment Advisors Inc. ("FIA") managed each of the Funds' portfolios
in this climate. Financial statements and a list of portfolio holdings for each
of the Funds as of October 31, 2000, appear at the end of the report.
Over the past year, a changing outlook for the economy and corporate
earnings shifted market leadership from technology stocks and a narrow group of
large growth companies to value-oriented stocks and stocks of small- and
mid-sized companies. In this environment, stock prices became more volatile, and
stock selection became increasingly important to maximizing total returns. While
market volatility can be unnerving, even for experienced investors, short-term
fluctuations are quite normal and should not deter you from the asset allocation
strategy you've set to meet long-term financial goals.
The Galaxy Funds have taken several steps to help you reach those goals.
With the completion of the reorganization of the Boston 1784 Funds into the
Galaxy Funds in June 2000, you now have a broader range of funds from which to
choose in diversifying your portfolio. As assets from the Boston 1784 Funds were
transferred to existing Galaxy Funds in connection with the reorganization, FIA
made the portfolio adjustments necessary in seeking to achieve each Fund's
investment objective. In implementing such adjustments, FIA sought to make the
most of current market conditions and to maximize each Fund's returns.
Going forward, Keith Banks, FIA's new Chief Investment Officer, will
oversee the portfolio management of the Galaxy Equity Funds and other funds in
the Galaxy family. Mr. Banks was the former managing director and head of U.S.
equities for J.P. Morgan Investment Management.
If you would like to know more about the expanded array of Galaxy Funds,
or you have questions about the information in this report, please contact the
Galaxy Information Center toll-free at 1-877-BUY-GALAXY (1-877-289-4252) or
visit us at www.galaxyfunds.com. You may also consult your financial advisor.
Sincerely,
/S/ SIGNATURE
DWIGHT E. VICKS
Dwight E. Vicks, Jr.
Chairman of the Board of Trustees
Mutual Funds:
(BULLET) are not bank deposits
(BULLET) are not FDIC insured
(BULLET) are not obligations of, or guaranteed by, any bank
(BULLET) are subject to investment risk, including possible loss of the
principal amount invested
<PAGE>
Market Overview
EQUITY MARKET OVERVIEW
BY FLEET INVESTMENT ADVISORS INC.
Changing expectations for economic growth and corporate earnings over the
past year, along with a sell-off in the overvalued technology sector, kept stock
prices volatile and brought a significant shift in market leadership. After
outperforming for several years, stocks of larger firms relinquished their
leadership to stocks of mid- and small-sized companies whose prices were more in
line with earnings. Toward the end of the period, investors also showed a
preference for value-oriented stocks over growth-related issues.
For the 12 months ended October 31, 2000, the Standard & Poor's 500 Index
(the "S&P 500 Index"), which represents large-cap growth stocks, earned a total
return of 6.08%. Over the same period, small-cap stocks represented by the
Russell 2000 Index (the "Russell 2000") had a total return of 17.41%. Although
continued improvements in economies abroad helped foreign stocks perform well
early in the period, rising oil prices, a weak euro and corporate profit
warnings later in the year left the Morgan Stanley Europe, Australasia, Far East
("EAFE") Index with a total return of -2.90% for the period as a whole.
By maintaining well-diversified portfolios, and trading technology stocks
and other issues that had reached our price targets for stocks that offered
better price potential, we helped the Galaxy Equity Funds make the most of the
year's market changes.
A CHANGE IN MARKET LEADERSHIP
When the reporting period began, during the fourth quarter of 1999, the
Gross Domestic Product ("GDP"), which measures the output of U.S. goods and
services, improved at an annualized rate of 7.3%. This rapid pace of growth,
accompanied by a relatively moderate 2.6% annualized rate of inflation and a
continued surge of "momentum investing" that drove technology issues to
stratospheric heights, helped the major U.S. equity indices post strong gains in
the last two months of the year. Overseas, economic gains boosted stock prices
in most markets.
Stock investors generally ignored the potential threat to earnings from a
hike in short-term interest rates of 25 basis points (0.25%) by the Federal
Reserve ("the Fed") on November 16, 1999. The increase, which the Fed had
imposed on top of earlier hikes totaling another 50 basis points, was intended
to slow growth enough to keep inflation under control and achieve a "soft
landing" for the economy. As investors anticipated further rate hikes in months
ahead, the yield for long-term Treasuries rose from 6.16% on November 1 to 6.48%
by the end of 1999.
With the rate of GDP growth still strong at 4.8% in the first quarter of
2000, as well as tight employment and rising energy costs keeping upward
pressure on inflation, the Fed imposed two more rate hikes of 25 basis points
each in February and March. As short-term rates reached their highest levels
since 1991, a mid-January announcement by the U.S. Treasury that it would reduce
new issues of government debt and buy back many longer-maturity bonds drove
long-term yields lower.
Despite the threat to growth posed by higher short-term rates, stock
prices continued to rise into March, as demand for technology stocks remained
strong, but became increasingly volatile. During this period, investors ventured
beyond the consumer-oriented Internet stocks that had dominated market
leadership for several quarters into a more diverse group of technology, media
and telecommunications issues. At the end of 1999, demand also increased for
technology stocks of smaller firms. By March, demand then shifted from "new
economy" stocks to the more reasonably priced stocks in "old economy" sectors.
Overseas, sizable losses in Japanese stocks and many of the emerging markets in
Asia were balanced by healthy gains in many European markets.
Despite the rise in short-term rates, the rate of GDP growth remained a
relatively strong 5.6% in the second quarter. The continued economic strength
was due in large part to earlier gains for stocks, which had created a "wealth
effect" that offset the impact of higher interest costs on corporate profits. As
a tight labor market and rising energy costs added upward pressure on prices,
the inflation rate rose to 3.7% in March. With expectations for further rate
hikes by the Fed, bond yields as a whole moved sharply higher and stock prices
fell throughout the market in April. Leading the way down were the greatly
overvalued stocks of technology firms.
Following a Fed hike in short-term rates of 50 basis points in May, it
became clear that economic growth was finally slowing. Stock prices generally
improved from mid-May to the beginning of September. However, with investors
more focused on company fundamentals, punishing firms for even slight
disappointments in earnings, stock prices remained volatile during this period.
2
<PAGE>
"WITH GROWTH SLOWING SOMEWHAT FASTER NOW THAN MANY ANALYSTS EXPECTED, STOCK
PRICES WILL PROBABLY REMAIN VULNERABLE TO CONCERNS ABOUT EARNINGS AS WELL AS
INTEREST RATES."
This volatility dampened stock prices in many stock markets abroad.
In the final weeks of the reporting period, investors became increasingly
worried about how corporate earnings would respond to rising energy prices and a
weak euro, in addition to a slowdown in domestic growth. As a result, stocks
forfeited some of the price gains they had made during the spring and summer.
Much of the price loss occurred in stocks of larger firms, whose valuations were
particularly vulnerable to earnings concerns. Prices for foreign stocks fell
sharply at the end of the period, due largely to weakness in the euro.
FOCUS ON VALUE AND DIVERSIFICATION
With technology stocks at extremely high valuations when the reporting
period began, we limited technology investments for the Galaxy Equity Funds to
issues whose prices were most attractive versus potential earnings. As the
prices for tech stocks moved higher in the first part of the period, we
routinely took profits out of holdings in the sector that had performed well and
added to positions in other technology firms or in companies outside the sector,
which we felt had better price potential. At the same time, we maintained
positions in a diverse mix of industry groups. This helped the Funds make the
most of the eventual shift in market leadership from technology stocks into
sectors with better value.
Of further benefit were overweightings in many of the market sectors that
outperformed during the year -- such as stocks of energy and health care firms
-- as well as strong stock selection in these and other areas.
EARNINGS WATCH
Although high oil prices and other factors could raise interest rates
further in coming months, we continue to expect a "soft landing" for the
economy. With growth slowing somewhat faster now than many analysts expected,
stock prices will probably remain vulnerable to concerns about earnings as well
as interest rates.
As investors become even more focused on fundamentals, market leadership
should continue to broaden. In this environment, value-oriented stocks of small
and foreign-based firms could outperform.
PERFORMANCE AT-A-GLANCE
AVERAGE ANNUAL TOTAL RETURNS -- TRUST SHARES
<TABLE>
10 YEARS/
AS OF OCTOBER 31, 2000 1 YEAR 3 YEARS 5 YEARS LIFE OF FUND*
<S> <C> <C> <C> <C>
--------------------------------------------------------------------------------------------------------
Asset Allocation Fund (INCEPTION DATE 12/30/91) 10.21% 11.28% 14.23% 12.02%
--------------------------------------------------------------------------------------------------------
Equity Income Fund (INCEPTION DATE 12/14/90) 8.94 11.70 15.60 14.18
--------------------------------------------------------------------------------------------------------
Growth and Income Fund (INCEPTION DATE 12/14/92) 9.38 11.42 16.85 15.36
--------------------------------------------------------------------------------------------------------
Strategic Equity Fund (INCEPTION DATE 3/4/98) 21.69 N/A N/A 7.73
--------------------------------------------------------------------------------------------------------
Equity Value Fund (INCEPTION DATE 9/1/88) 8.22 11.14 16.82 16.57
--------------------------------------------------------------------------------------------------------
Equity Growth Fund (INCEPTION DATE 12/14/90) 18.63 20.50 22.86 18.33
--------------------------------------------------------------------------------------------------------
Growth Fund II (INCEPTION DATE 3/28/96)** 51.00 23.34 N/A 22.67
--------------------------------------------------------------------------------------------------------
Small Cap Value Fund (INCEPTION DATE 12/14/92) 22.62 4.53 15.56 14.27
--------------------------------------------------------------------------------------------------------
Small Company Equity Fund (INCEPTION DATE 12/30/91) 39.43 6.03 12.19 13.12
--------------------------------------------------------------------------------------------------------
International Equity Fund (INCEPTION DATE 12/30/91) (1.08) 13.62 13.78 11.10
--------------------------------------------------------------------------------------------------------
</TABLE>
* Return figures shown are average annual total returns for the 10 years
ended October 31, 2000 for the Equity Value Fund and for the period from
inception through October 31, 2000 for each other Fund.
** The Galaxy Growth Fund II commenced operations as a separate portfolio
(the "Predecessor Fund") of the Boston 1784 Funds. On June 26, 2000, the
Predecessor Fund was reorganized as a new portfolio of the Galaxy Fund.
Prior to the reorganization, the Predecessor Fund offered and sold one
series of shares. In connection with the reorganization, shareholders of
the Predecessor Fund exchanged their shares for Trust Shares and BKB
Shares of the Galaxy Growth Fund II. Shareholders of the Predecessor Fund
who purchased their shares through an investment management, trust,
custody or other agency relationship with BankBoston, N.A. received Trust
Shares of the Fund and shareholders of the Predecessor Fund who purchased
their shares other than through an investment management, trust, custody
or other agency relationship with BankBoston, N.A. received BKB Shares of
the Fund. The total returns shown above for Trust Shares of the Galaxy
Growth Fund II for periods prior to June 26, 2000 represent the returns
for the Predecessor Fund.
3
<PAGE>
PERFORMANCE AT-A-GLANCE (continued)
AVERAGE ANNUAL TOTAL RETURNS-- RETAIL A SHARES*
<TABLE>
10 YEARS/
AS OF OCTOBER 31, 2000 1 YEAR 3 YEARS 5 YEARS LIFE OF FUND****
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Asset Allocation Fund
(INCEPTION DATE 12/30/91) 5.86% 9.70% 13.16% 11.39%
-------------------------------------------------------------------------------------------------------------
Equity Income Fund**
(INCEPTION DATE 12/14/90) 4.38 9.84 14.22 13.42
-------------------------------------------------------------------------------------------------------------
Growth and Income Fund
(INCEPTION DATE 2/12/93) 4.99 9.75 15.64 14.83
-------------------------------------------------------------------------------------------------------------
Strategic Equity Fund
(INCEPTION DATE 3/4/98) 16.50 N/A N/A 5.67
-------------------------------------------------------------------------------------------------------------
Equity Value Fund**
(INCEPTION DATE 9/1/88) 3.80 9.34 15.51 15.85
-------------------------------------------------------------------------------------------------------------
Equity Growth Fund**
(INCEPTION DATE 12/14/90) 13.75 18.52 21.44 17.58
-------------------------------------------------------------------------------------------------------------
Growth Fund II
(INCEPTION DATE 6/26/00) N/A N/A N/A 4.86(DAGGER)
-------------------------------------------------------------------------------------------------------------
Small Cap Value Fund
(INCEPTION DATE 2/12/93) 17.35 2.77 14.23 13.66
-------------------------------------------------------------------------------------------------------------
Small Company Equity Fund
(INCEPTION DATE 12/30/91) 33.68 4.23 10.83 12.26
-------------------------------------------------------------------------------------------------------------
International Equity Fund
(INCEPTION DATE 12/30/91) (5.17) 11.62 12.31 10.20
-------------------------------------------------------------------------------------------------------------
</TABLE>
AVERAGE ANNUAL TOTAL RETURNS-- PRIME A SHARES***
<TABLE>
<CAPTION>
AS OF OCTOBER 31, 2000 1 YEAR 3 YEARS 5 YEARS LIFE OF FUND
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Asset Allocation Fund
(Inception date 11/1/98) 4.10% N/A N/A 6.86%
-------------------------------------------------------------------------------------------------------------
Growth and Income Fund
(Inception date 11/1/98) 3.27 N/A N/A 8.87
-------------------------------------------------------------------------------------------------------------
Equity Growth Fund
(Inception date 11/1/98) 11.86 N/A N/A 19.31
-------------------------------------------------------------------------------------------------------------
Small Cap Value Fund
(Inception date 11/1/98) 15.52 N/A N/A 10.56
-------------------------------------------------------------------------------------------------------------
International Equity Fund
(Inception date 11/1/98) (6.76) N/A N/A 9.98
-------------------------------------------------------------------------------------------------------------
</TABLE>
(DAGGER) Unannualized total return.
* Return figures have been restated to include the effect of the maximum
3.75% front-end sales charge which became effective on December 1, 1995.
** Retail A Shares of the Equity Value Fund and Equity Growth Fund were first
issued during the fiscal year ended October 31, 1991 and Retail A Shares
of the Equity Income Fund were first issued during the fiscal year ended
October 31, 1992. The returns for prior periods represent the returns for
Trust Shares of the Funds. Prior to November 1, 1993, the returns for
Retail A Shares and Trust Shares of the Funds were the same because each
series of shares had the same expenses.
*** Return figures include the effect of the maximum 5.50% front-end sales
charge.
**** Return figures shown are average annual total returns for the 10 years
ended October 31, 2000 for the Equity Value Fund and for the period from
inception through October 31, 2000 for each other Fund.
4
<PAGE>
PERFORMANCE AT-A-GLANCE (continued)
AVERAGE ANNUAL TOTAL RETURNS-- RETAIL B SHARES**
<TABLE>
<CAPTION>
1 YEAR 1 YEAR 3 YEARS 3 YEARS LIFE OF FUND LIFE OF FUND
RETURN BEFORE RETURN AFTER RETURN BEFORE RETURN AFTER RETURN BEFORE RETURN AFTER
CONTINGENT CONTINGENT CONTINGENT CONTINGENT CONTINGENT CONTINGENT
DEFERRED SALES DEFERRED SALES DEFERRED SALES DEFERRED SALES DEFERRED SALES DEFERRED SALES
AS OF OCTOBER 31, 2000 CHARGE DEDUCTED CHARGE DEDUCTED* CHARGE DEDUCTED CHARGE DEDUCTED* CHARGE DEDUCTED CHARGE DEDUCTED*
----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Asset Allocation Fund
(INCEPTION DATE 3/4/96) 9.20% 4.20% 10.35% 9.52% 12.44% 12.30%
----------------------------------------------------------------------------------------------------------------------------------
Equity Income Fund
(INCEPTION DATE 11/1/98) 7.71 3.17 N/A N/A 8.54 6.87
----------------------------------------------------------------------------------------------------------------------------------
Growth and Income Fund
(INCEPTION DATE 3/4/96) 8.35 3.35 10.36 9.54 14.17 14.03
----------------------------------------------------------------------------------------------------------------------------------
Strategic Equity Fund
(INCEPTION DATE 3/4/98) 20.33 15.33 N/A N/A 6.48 5.41
----------------------------------------------------------------------------------------------------------------------------------
Equity Value Fund
(INCEPTION DATE 3/4/96) 7.12 2.50 9.97 9.20 14.25 14.12
----------------------------------------------------------------------------------------------------------------------------------
Equity Growth Fund
(INCEPTION DATE 3/4/96) 17.29 12.29 19.18 18.47 20.56 20.45
----------------------------------------------------------------------------------------------------------------------------------
Growth Fund II
(INCEPTION DATE 6/26/00) N/A N/A N/A N/A 8.76(DAGGER) 3.76(DAGGER)
----------------------------------------------------------------------------------------------------------------------------------
Small Cap Value Fund
(INCEPTION DATE 11/1/98) 21.06 16.06 N/A N/A 12.64 10.85
----------------------------------------------------------------------------------------------------------------------------------
Small Company Equity Fund
(INCEPTION DATE 3/4/96) 37.82 32.82 4.91 4.00 10.23 10.08
----------------------------------------------------------------------------------------------------------------------------------
International Equity Fund
(INCEPTION DATE 11/1/98) (2.22) (6.86) N/A N/A 12.05 10.25
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(DAGGER) Unannualized total returns.
* As if shares were redeemed at end of period.
** Retail B Shares are subject to a 5.00% contingent deferred sales charge if
shares are redeemed within the first year. The charge decreases to 4.00%,
3.00%, 3.00%, 2.00% and 1.00% for redemptions made during the second
through sixth years, respectively. Retail B Shares automatically convert
to Retail A Shares after six years.
5
<PAGE>
PERFORMANCE AT-A-GLANCE (continued)
AVERAGE ANNUAL TOTAL RETURNS-- PRIME B SHARES**
<TABLE>
<CAPTION>
1 YEAR 1 YEAR 3 YEAR 3 YEAR LIFE OF FUND LIFE OF FUND
RETURN BEFORE RETURN AFTER RETURN BEFORE RETURN AFTER RETURN BEFORE RETURN AFTER
CONTINGENT CONTINGENT CONTINGENT CONTINGENT CONTINGENT CONTINGENT
DEFERRED SALES DEFERRED SALES DEFERRED SALES DEFERRED SALES DEFERRED SALES DEFERRED SALES
AS OF OCTOBER 31, 2000 CHARGE DEDUCTED CHARGE DEDUCTED* CHARGE DEDUCTED CHARGE DEDUCTED* CHARGE DEDUCTED CHARGE DEDUCTED*
----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Asset Allocation Fund
(INCEPTION DATE 11/1/98) 9.29% 4.29% N/A N/A 9.10% 7.25%
----------------------------------------------------------------------------------------------------------------------------------
Growth and Income Fund
(INCEPTION DATE 11/1/98) 8.38 3.38 N/A N/A 11.14 9.33
----------------------------------------------------------------------------------------------------------------------------------
Equity Growth Fund
(INCEPTION DATE 11/1/98) 17.48 12.48 N/A N/A 22.05 20.40
----------------------------------------------------------------------------------------------------------------------------------
Small Cap Value Fund
(INCEPTION DATE 11/1/98) 21.46 16.46 N/A N/A 12.91 11.12
----------------------------------------------------------------------------------------------------------------------------------
International Equity Fund
(INCEPTION DATE 11/1/98) (2.02) (6.66) N/A N/A 12.32 10.52
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS -- BKB SHARES
AS OF OCTOBER 31, 2000 1 YEAR 3 YEARS 5 YEARS LIFE OF FUND
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Asset Allocation Fund
(INCEPTION DATE 6/19/00) N/A N/A N/A 0.96%(DAGGER)
--------------------------------------------------------------------------------------
Growth and Income Fund
(INCEPTION DATE 6/19/00) N/A N/A N/A 2.43(DAGGER)
--------------------------------------------------------------------------------------
Growth Fund II
(INCEPTION DATE 3/28/96)*** 50.89% 23.31% N/A 22.65
--------------------------------------------------------------------------------------
International Equity Fund
(INCEPTION DATE 6/19/00) N/A N/A N/A (12.59)(DAGGER)
--------------------------------------------------------------------------------------
</TABLE>
(DAGGER) Unannualized total returns.
* As if shares were redeemed at end of period.
** Prime B Shares are subject to a 5.00% contingent deferred sales charge if
shares are redeemed within the first year. The charge decreases to 4.00%,
3.00%, 3.00%, 2.00% and 1.00% for redemptions made during the second
through sixth years, respectively. Prime B Shares automatically convert to
Prime A Shares after eight years.
*** The Galaxy Growth Fund II commenced operations as a separate portfolio
(the "Predecessor Fund") of the Boston 1784 Funds. On June 26, 2000, the
Predecessor Fund was reorganized as a new portfolio of The Galaxy Fund.
Prior to the reorganization, the Predecessor Fund offered and sold one
series of shares. In connection with the reorganization, shareholders of
the Predecessor Fund exchanged their shares for Trust Shares and BKB
Shares of the Galaxy Growth Fund II. Shareholders of the Predecessor Fund
who purchased their shares through an investment management, trust,
custody or other agency relationship with BankBoston, N.A. received Trust
Shares of the Fund and shareholders of the Predecessor Fund who purchased
their shares other than through an investment management, trust, custody
or other agency relationship with BankBoston, N.A. received BKB Shares of
the Fund. The total returns shown above for BKB Shares of the Galaxy
Growth Fund II for periods prior to June 26, 2000 represent the returns
for the Predecessor Fund.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. INVESTMENT RETURNS AND
PRINCIPAL VALUES WILL VARY WITH MARKET CONDITIONS SO THAT AN INVESTOR'S SHARES,
WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. THE
INVESTMENT ADVISOR IS PRESENTLY WAIVING FEES AND/OR REIMBURSING EXPENSES AND MAY
REVISE OR DISCONTINUE SUCH PRACTICE AT ANY TIME. WITHOUT SUCH WAIVERS AND/OR
REIMBURSEMENTS, PERFORMANCE WOULD BE LOWER. TOTAL RETURN FIGURES IN THIS REPORT
INCLUDE CHANGES IN SHARE PRICE, REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS
DISTRIBUTIONS AND INCLUDE THE DEDUCTION OF ANY SALES CHARGES, WHERE APPLICABLE,
UNLESS OTHERWISE INDICATED.
6
<PAGE>
PORTFOLIO REVIEWS
GALAXY ASSET ALLOCATION FUND
BY DON JONES
PORTFOLIO MANAGER
[PHOTO OMITTED - DON JONES]
DON JONES BECAME MANAGER OF THE GALAXY ASSET ALLOCATION FUND IN APRIL 1995. HE
HAS MANAGED INVESTMENT PORTFOLIOS FOR FLEET INVESTMENT ADVISORS INC., AND ITS
PREDECESSORS, SINCE 1977.
As economic uncertainty made stock prices more volatile in the past year,
and market leadership broadened beyond the technology sector, the Galaxy Asset
Allocation Fund benefited from a well-diversified portfolio of high-quality
stocks and a sizable position in bonds.
For the 12-months ended October 31, 2000, Trust Shares of the Galaxy Asset
Allocation Fund earned a total return of 10.21%. For the same period, its Retail
A Shares returned 9.98%, before deducting the maximum 3.75% front-end sales
charge, and its Retail B Shares returned 9.20%, before deducting the maximum
5.00% contingent deferred sales charge. During the period, Prime A Shares of the
Fund returned 10.15% before deducting the maximum 5.50% front-end sales charge,
and Prime B Shares of the Fund returned 9.29% before deducting the maximum 5.00%
contingent deferred sales charge. The total return for BKBShares of the Fund for
the period June 19, 2000 (date of initial issuance) through October 31, 2000 was
0.96%. (Please see the charts on page 4 for total returns after deducting the
applicable front-end sales charge and the charts on pages 5 and 6 for total
returns after deducting the applicable contingent deferred sales charge.)
These total returns compare with a total return of 9.34% for the average
flexible fund tracked by Lipper Analytical Services Inc. ("Lipper"). During the
same time, the S&P 500 Index, which only tracks the performance of stocks,
returned 6.08%.
POSITIONED FOR MARKET ROTATION
In the final months of 1999, the Fund benefited from strong gains by
holdings in the technology, retail, and oil-services sectors that helped offset
disappointing performance by its drug and financial stocks. At this point, we
took profits in stocks of selected industrial, office equipment, beverage, and
paper firms and used the proceeds to add to technology, consumer retail,
financial, and electronics holdings that we felt had better growth potential.
As the technology sector advanced further in the first months of 2000,
gains from the Fund's technology positions helped offset further disappointments
from drug and financial stocks. Using cash reserves and proceeds from the sale
of drug and food stocks, we continued to add selectively to technology holdings
and increased investments in biotech firms. Within the financial sector, we
traded stocks with less potential for new investment opportunities.
During the second and third quarters of 2000, strong total returns from
the Fund's energy stocks boosted performance. As technology stocks became more
overvalued, we took profits in many positions. This strategy, plus an
outperformance by the tech stocks that remained, helped the Fund weather the
technology sell-off relatively well. Of further help was a reduced weighting in
the lesser-performing consumer staples sector. With the profits from tech stocks
and some energy and financial positions, we increased investments in stocks of
biotech, electronic, telephone utility, and industrial firms.
Throughout the year, we kept 40% of the Fund's assets in bonds. Although
falling bond prices dampened Fund total returns early in the period,
shareholders benefited from rising yields. Later in the period, a rise in bond
prices boosted total returns. We increased positions in corporates early in the
year, when their prices were particularly attractive. We later reduced corporate
holdings, and gave less attention to longer-term corporates, as investors became
nervous about the outlook for company earnings.
STAYING DIVERSIFIED
As the reporting period ended, we were taking further profits in the
technology, energy, and drug sectors and using the proceeds to add more biotech
stocks and stocks of selected health care providers, where the Fund has been
underweighted. In months to come, we plan to maintain a well-diversified mix of
high-quality stocks that can benefit from further shifts in market leadership
and weather additional price volatility relatively well. If stock prices weaken
significantly, we may move some money from bonds into stocks to make the most of
new investment opportunities that arise.
7
<PAGE>
PORTFOLIO REVIEWS
GALAXY ASSET ALLOCATION FUND
DISTRIBUTION OF TOTAL NET ASSETS AS OF OCTOBER 31, 2000
[GRAPHIC OMITTED]
GALAXY ASSET ALLOCATION PIE CHART
CORPORATE NOTES AND BONDS 15%
ASSET-BACKED AND MORTGAGE-BACKED SECURITIES 3%
U.S. GOVERNMENT AND AGENCY OBLIGATIONS 20%
COMMON STOCKS 54%
FOREIGN BONDS 2%
COMMERCIAL PAPER, PREFERRED STOCK &
NET OTHER ASSETS AND LIABILITIES 6%
GALAXY ASSET ALLOCATION FUND
GROWTH OF $10,000 INVESTMENT*
[GRAPHIC OMITTED]
GALAXY ASSET ALLOCATION MOUNTAIN CHART
EDGAR REPRESENTATION OF DATA POINTS IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GALAXY ASSET GALAXY ASSET GALAXY ASSET GALAXY ASSET GALAXY ASSET GALAXY ASSET
S&P 500 ALLOCATION FUND- ALLOCATION FUND- ALLOCATION FUND- ALLOCATION FUND- ALLOCATION FUND- ALLOCATION FUND-
INDEX RETAIL A SHARES RETAIL B SHARES TRUST SHARES PRIME A SHARES PRIME B SHARES BKB SHARES
<S> <C> <C> <C> <C> <C> <C> <C>
12/30/91 10000 9625 10000
10/31/92 10295 9899 10285
10/31/93 11830 11124 11558
10/31/94 12284 10900 11335
10/31/95 15528 13452 10000 14019
10/31/96 19270 15728 10271 16429
10/31/97 25458 18911 12454 19785
10/31/98 31186 21134 14314 22115 9450 10000
10/31/99 38978 23581 15618 24736 10366 10391
6/30/00 41931 25785 17120 27088 11348 11464 10000
10/31/00 41348 25935 17173 27261 10366 11503 10096
</TABLE>
* SINCE INCEPTION ON 12/30/91 FOR TRUST AND RETAIL A SHARES. SINCE INCEPTION ON
3/4/96 FOR RETAIL B SHARES. SINCE INCEPTION ON 11/1/98 FOR PRIME A SHARES AND
PRIME B SHARES. SINCE INCEPTION ON 6/19/00 FOR BKBSHARES. PERFORMANCE FIGURES
FOR RETAIL A SHARES INCLUDE THE EFFECT OF THE MAXIMUM 3.75% FRONT-END SALES
CHARGE. PERFORMANCE FIGURES FOR PRIME A SHARES INCLUDE THE EFFECT OF THE
MAXIMUM 5.50% FRONT-END SALES CHARGE. PERFORMANCE FIGURES FOR RETAIL B AND
PRIME B SHARES REFLECT THE DEDUCTION OF THE 2.00% CONTINGENT DEFERRED SALES
CHARGE (APPLICABLE TO SHARES REDEEMED DURING THE FIFTH YEAR AFTER PURCHASE)
AND THE 4.00% CONTINGENT DEFERRED SALES CHARGE (APPLICABLE TO SHARES REDEEMED
DURING THE SECOND YEAR AFTER PURCHASE), RESPECTIVELY, AS IF SHARES WERE
REDEEMED ON OCTOBER 31, 2000. THE S&P 500 INDEX IS AN UNMANAGED INDEX IN WHICH
INVESTORS CANNOT INVEST. RESULTS FOR THE INDEX DO NOT REFLECT THE INVESTMENT
MANAGEMENT FEES AND OTHER EXPENSES INCURRED BY THE FUND.
GALAXY EQUITY INCOME FUND
BY ED KLISIEWICZ
PORTFOLIO MANAGER
[PHOTO OMITTED - ED KLISIEWICZ]
ED KLISIEWICZ HAS BEEN PORTFOLIO MANAGER OF THE GALAXY EQUITY INCOME FUND SINCE
ITS INCEPTION IN DECEMBER OF 1990. HE HAS MANAGED PORTFOLIOS FOR FLEET
INVESTMENT ADVISORS INC., AND ITS PREDECESSORS, SINCE 1970.
With stock prices volatile and bond yields falling for much of the
12-month period ended October 31, 2000, the higher-dividend sectors, where the
Galaxy Equity Income Fund concentrates its investments, performed well relative
to the market as a whole. The Fund also benefited as the income from these
stocks enhanced total returns. Of further help was an underweighting in
technology stocks when that sector corrected, as well as a general attention to
stocks with reasonable valuations. These factors combined to help the Fund
outperform both its market benchmark and other funds with similar investment
objectives.
For the 12-months ended October 31, 2000, the Fund's Trust Shares had a
total return of 8.94%. Over the same time, its Retail A Shares had a total
return of 8.45%, before deducting the maximum 3.75% front-end sales charge and
its Retail B Shares earned a total return of 7.71% before deducting the maximum
5.00% contingent deferred sales charge. (Please see the chart on page 4 for
total returns after deducting the front-end sales charge and the chart on page 5
for total returns after deducting the contingent deferred sales charge.) Those
total returns compare to a total return of 6.94% for the average equity income
fund tracked by Lipper. Over the same time the S&P 500 Index had a total return
of 6.08%.
MANY INDIVIDUAL CONTRIBUTIONS
Because the prices for many technology stocks far exceeded the earnings
outlook for their firms, we began the reporting period underweighted in the
sector. While this reduced the Fund's participation in the strong gains
technology stocks enjoyed through the first months of the period, it helped
protect the value of Fund shares when the sector later weakened. In the
meantime, many individual technology holdings (such as Hewlett Packard, Intel,
and Cisco Systems) added to the Fund's total returns.
8
<PAGE>
PORTFOLIO REVIEWS
During the year, we made many adjustments to the Fund's portfolio that let
us take advantage of new investment opportunities that arose from market
fluctuations. At the end of 1999, we used profits from the retail and
telecommunications sectors to add selected technology, banking, and insurance
firms. The addition of financial stocks proved beneficial at the start of 2000
and helped offset returns from utility positions that suffered as interest rates
rose. At this point, we used profits from technology issues and other holdings
that had performed well to add stocks with better price potential.
When stock prices weakened in April, the Fund benefited from
overweightings in drug and energy stocks, which earned above-average total
returns, and from the outperformance by many individual holdings. As interest
rates stabilized in the summer and fall, the Fund enjoyed further gains from its
financial and energy holdings. This, plus positive contributions from a rebound
in utility stocks and selected technology stocks, helped offset a disappointing
performance by the Fund's drug positions. Throughout this time, we continued to
use profits from better-performing issues to add stocks that we expected to
outperform going forward.
FOCUS ON DEFENSIVE ISSUES
Expecting growth to slow as the Fed prepares a soft landing for the
economy, we have given greater attention to economically "defensive" issues with
attractive yields. As a result, the Fund has significant positions in stocks of
utility and consumer staples firms. In these and other areas, we continue to
emphasize stocks of high-quality companies with strong earnings records and
reasonable stock prices.
GALAXY EQUITY INCOME FUND
DISTRIBUTION OF TOTAL NET ASSETS AS OF OCTOBER 31, 2000
[GRAPHIC OMITTED]
GALAXY EQUITY INCOME FUND PIE CHART
INDUSTRIAL 7%
BASIC MATERIALS 4%
COMMUNICATIONS 8%
ENERGY 9%
U.S. GOVERNMENT AND AGENCY
OBLIGATION, REPURCHASE AGREEMENT
& NET OTHER ASSETS AND LIABILITIES 10%
CONSUMER CYCLICAL 10%
TECHNOLOGY 15%
FINANCE 17%
CONSUMER STAPLES 16%
UTILITIES 4%
GALAXY EQUITY INCOME FUND
GROWTH OF $10,000 INVESTMENT*
[GRAPHIC OMITTED]
GALAXY EQUITY INCOME MOUNTAIN CHART
EDGAR REPRESENTATION OF DATA POINTS IN PRINTED GRAPHIC
GALAXY EQUITY GALAXY EQUITY GALAXY EQUITY
S&P 500 INCOME FUND- INCOME FUND- INCOME FUND-
INDEX RETAIL A SHARES RETAIL B SHARES TRUST SHARES
12/14/90 10000 9625 10000
12/14/91 12358 11127 11561
12/14/92 13589 12207 12683
12/14/93 15615 13654 14186
12/14/94 16215 14055 14615
12/14/95 20497 17179 17948
12/14/96 25437 20445 21475
12/14/97 33605 25204 26585
12/14/98 41166 29836 10000 31526
12/14/99 52243 31988 10444 34010
12/14/00 55419 34692 11422 37049
* SINCE INCEPTION ON 12/14/90 FOR RETAIL A AND TRUST SHARES. SINCE INCEPTION ON
11/1/98 FOR RETAIL B SHARES. PERFORMANCE FIGURES FOR RETAIL A SHARES INCLUDE
THE EFFECT OF THE MAXIMUM 3.75% FRONT-END SALES CHARGE. PERFORMANCE FIGURES
FOR RETAIL B SHARES REFLECT THE DEDUCTION OF THE 4.00% CONTINGENT DEFERRED
SALES CHARGE (APPLICABLE TO SHARES REDEEMED DURING THE SECOND YEAR AFTER
PURCHASE) AS IF SHARES WERE REDEEMED ON OCTOBER 31, 2000. THE S&P 500 INDEX
IS AN UNMANAGED INDEX IN WHICH INVESTORS CANNOT INVEST. RESULTS FOR THE INDEX
DO NOT REFLECT INVESTMENT MANAGEMENT FEES AND OTHER EXPENSES INCURRED BY THE
FUND.
9
<PAGE>
PORTFOLIO REVIEWS
GALAXY GROWTH AND INCOME FUND
BY GREG MILLER
PORTFOLIO MANAGER
[PHOTO OMITTED - GREG MILLER]
GREG MILLER HAS MANAGED THE GALAXY GROWTH AND INCOME FUND SINCE JULY OF 1998. HE
HAS MANAGED EQUITY PORTFOLIOS SINCE 1988.
As market leadership broadened from technology stocks into other sectors
over the past year, and investors shifted to value-oriented issues, the Galaxy
Growth and Income Fund benefited from reduced positions in technology stocks and
its ongoing focus on stocks whose prices are attractive versus the earnings
potential of their firms.
For the 12-months ended October 31, 2000, the Fund's Trust Shares earned a
total return of 9.38%. Over the same time, its Retail A Shares earned 9.06%,
before deducting the maximum 3.75% front-end sales charge, and its Retail B
Shares earned 8.35%, before deducting the maximum 5.00% contingent deferred
sales charge. During the period, Prime A Shares of the Fund earned 9.27% before
deducting the maximum 5.50% front-end sales charge and Prime B Shares of the
Fund earned 8.38% before deducting the maximum 5.00% contingent deferred sales
charge. The total return for BKB Shares of the Fund for the period June 19, 2000
(date of initial issuance) through October 31, 2000 was 2.43%.(Please see the
charts on page 4 for total returns after deducting the applicable front-end
sales charge and the charts on pages 5 and 6 for total returns after deducting
the applicable contingent deferred sales charge.)
These results compare to a total return of 10.98% for the average
multi-cap value fund tracked by Lipper. For the same period, the S&P 500 Index,
which represents a more growth-oriented universe of stocks, had a total return
of 6.08%.
MAXIMIZING A RETURN TO VALUE
The Fund began the period with an underweighted position in technology
stocks, whose high valuations made them inappropriate for our value-oriented
investment strategy. While this diminished total returns when the tech sector
was leading market gains at the end of 1999 and the start of 2000, the strategy
helped performance when investors later abandoned technology stocks for other
sectors. In the meantime, the Fund enjoyed above-average total returns from many
individual tech positions.
Of further help was an overweighted position in the health care sector,
which outperformed for the period, and strong performances by individual health
care positions like HealthSouth, Forest Labs and Elan. Overweightings and stock
selection also helped in the capital goods and energy sectors -- where stocks
like Tyco, Honeywell, United Technologies, Baker Hughes, Schlumberger and Exxon
boosted returns.
Such positive contributions helped offset disappointing returns from
retail stocks like Circuit City and J.C. Penney, which underperformed on
concerns about a slowdown in consumer spending. The communications-services
sector was also weak, with poor performances from AT&T and WorldCom.
During the first half of the period, we took profits in technology, health
care, banking, and energy stocks that had performed well and used the proceeds
to add positions throughout the portfolio that offered better price potential.
In the second half, we traded financial, energy, technology, and basic materials
stocks for drug and consumer cyclical stocks -- as well as other technology,
basic materials, and energy stocks with greater value.
MOVE TO VALUE COULD CONTINUE
We are hopeful that the return of investors to value-oriented stocks in
recent months will continue. While an economic slowdown can make stocks with
strong earnings growth more attractive to investors, many technology stocks and
other growth-oriented issues are still quite expensive versus their earnings.
In this environment, we intend to maintain the diversification that we've
established for the Fund's portfolio and continue to emphasize quality companies
with attractive prices. We may soon reduce the Fund's energy position and
increase holdings in the retail group and other consumer sectors. While health
care stocks have enjoyed substantial gains, we believe they continue to offer
reasonably good value -- especially compared to technology stocks.
10
<PAGE>
PORTFOLIO REVIEWS
GALAXY GROWTH AND INCOME FUND
DISTRIBUTION OF TOTAL NET ASSETS AS OF OCTOBER 31, 2000
[GRAPHIC OMITTED]
GALAXY GROWTH AND INCOME FUND PIE CHART
ENERGY 10%
INDUSTRIAL 8%
CONSUMER CYCLICAL 10%
CONVERTIBLE PREFERRED STOCKS,
OTHER COMMON STOCKS, REPURCHASE
AGREEMENT & NET OTHER ASSETS
AND LIABILITIES 13%
FINANCE 15%
CONSUMER STAPLES 22%
TECHNOLOGY 13%
COMMUNICATIONS 9%
GROWTH OF $10,000 INVESTMENT*
GALAXY GROWTH AND INCOME FUND
[GRAPHIC OMITTED]
GALAXY GROWTH AND INCOME MOUNTAIN CHART
EDGAR REPRESENTATION OF DATA POINTS IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GALAXY GROWTH GALAXY GROWTH GALAXY GROWTH GALAXY GROWTH GALAXY GROWTH GALAXY GROWTH
S&P 500 AND INCOME FUND- AND INCOME FUND- AND INCOME FUND- AND INCOME FUND- AND INCOME FUND- AND INCOME FUND-
INDEX RETAIL A SHARES RETAIL B SHARES TRUST SHARES PRIME A SHARES PRIME B SHARES BKB SHARES
<S> <C> <C> <C> <C> <C> <C> <C>
12/14/92 10000 9625 10000
10/31/93 10890 9861 10256
10/31/94 11548 10548 10993
10/31/95 14601 12316 10000 12871
10/31/96 18120 15497 10221 16264
10/31/97 23938 18318 11986 19255
10/31/98 29324 25231 16387 26598 9450 10000
10/31/99 36669 26641 16912 28180 10847 10898
6/30/00 38966 27972 17779 29631 11398 11514 10000
10/31/00 38898 29054 18441 30822 11853 11953 10243
</TABLE>
* SINCE INCEPTION ON 12/14/92 FOR TRUST SHARES AND 2/12/93 FOR RETAIL A SHARES.
SINCE INCEPTION ON 3/4/96 FOR RETAIL B SHARES. SINCE INCEPTION ON 11/1/98 FOR
PRIME A SHARES AND PRIME B SHARES. SINCE INCEPTION ON 6/19/00 FOR BKBSHARES.
PERFORMANCE FIGURES FOR RETAIL A SHARES INCLUDE THE EFFECT OF THE MAXIMUM
3.75% FRONT-END SALES CHARGE. PERFORMANCE FIGURES FOR PRIME A SHARES INCLUDE
THE EFFECT OF THE MAXIMUM 5.50% FRONT-END SALES CHARGE. PERFORMANCE FIGURES
FOR RETAIL B AND PRIME B SHARES REFLECT THE DEDUCTION OF THE 2.00% CONTINGENT
DEFERRED SALES CHARGE (APPLICABLE TO SHARES REDEEMED DURING THE FIFTH YEAR
AFTER PURCHASE) AND THE 4.00% CONTINGENT DEFERRED SALES CHARGE (APPLICABLE TO
SHARES REDEEMED DURING THE SECOND YEAR AFTER PURCHASE), RESPECTIVELY, AS IF
SHARES WERE REDEEMED ON OCTOBER 31, 2000. THE S&P 500 INDEX IS AN UNMANAGED
INDEX IN WHICH INVESTORS CANNOT INVEST. RESULTS FOR THE INDEX DO NOT REFLECT
THE INVESTMENT MANAGEMENT FEES AND OTHER EXPENSES INCURRED BY THE FUND.
GALAXY STRATEGIC EQUITY FUND
BY PETER B. HATHAWAY, CFA
PORTFOLIO MANAGER
[PHOTO OMITTED - PETER HATHAWAY]
PETER HATHAWAY HAS MANAGED THE GALAXY STRATEGIC EQUITY FUND SINCE ITS INCEPTION
IN MARCH OF 1998. HE HAS WORKED FOR FLEET INVESTMENT ADVISORS INC., AND ITS
PREDECESSORS, SINCE 1965 AND HAS MANAGED INVESTMENTS SINCE 1974.
During the past 12-months, the Galaxy Strategic Equity Fund maintained its
value discipline of owning equities that were reasonably priced relative to
their earnings and growth potential. Historically, this discipline has kept the
Fund away from stocks that are excessively priced versus their underlying
fundamentals. Over the past year, the discipline has led to an underweighting in
technology stocks and many of the large companies with dominant weightings in
the S&P 500 Index. Instead, we took advantage of values among energy and
financial stocks and gave emphasis to the bottom 450 names in the S&P 500 Index,
which traded at steep discounts to the top 50 names in the Index on a
price-to-earnings basis.
In the early part of the year, the continued strong performance by a
narrow group of stocks caused the Fund to lag the market. Later, however, the
Fund's emphasis on reasonably priced stocks was rewarded -- especially its focus
on mid-cap and value-oriented stocks. For the period as a whole, the Fund earned
outstanding returns that outpaced its market benchmark and other funds with
similar investment objectives.
For the 12-months ended October 31, 2000, the Fund's Trust Shares earned a
total return of 21.69%. For the same period, its Retail A Shares returned
21.09%, before deducting the maximum 3.75% front-end sales charge, and its
Retail B Shares returned 20.33%, before deducting the maximum 5.00% contingent
deferred sales charge. (Please see the chart on page 4 for total returns after
deducting the front-end sales charge and the chart on page 5 for total returns
after deducting the contingent deferred sales charge.)
Over the same time, the average multi-cap core fund tracked by Lipper
earned a total return of 14.62% and the S&P 500 Index returned 6.08%.
11
<PAGE>
PORTFOLIO REVIEWS
STOCK SELECTION INCREASINGLY IMPORTANT
The explosion in market capitalizations and price-to-earnings ratios for
the largest stocks in the S&P 500 Index that began in 1997 peaked in March of
2000. The depressed valuations created at the peak of this bubble, when
investors were infatuated with technology stocks and other "new economy stocks,"
allowed the Fund to purchase stocks of financial, energy, and medium-sized
companies at attractive prices. The leading contributors to the Fund's
performance during the reporting period were financial, consumer staples,
energy, and capital goods stocks. The specific stock selection in these and
other areas also proved beneficial, reflecting a renewed interest in
value-oriented investing and stock fundamentals by investors.
Throughout the period, we sought to upgrade the growth potential and
investment stature of holdings in the Fund's portfolio. This led us to
top-quality stocks that had become undervalued because of temporary earnings
disappointments. In the second half of the year, we took profits in some of the
Fund's energy holdings and increased positions in consumer cyclicals.
CONTINUED FOCUS ON GROWTH AT A REASONABLE PRICE
Our emphasis on paying a reasonable price for a company's earnings and
growth prospects should continue to benefit Fund total returns in coming months,
as uncertainty sends investors back to investing basics and company valuations
become more important. We are comfortable with the fundamental underpinnings of
the Fund's holdings and can justify their prices based upon historical
precedent.
We plan to continue looking for stocks that offer superior return
potential over a 12- to 24-month timeframe. As investors become more confident
that the current economic expansion will continue, we are finding value in
economically sensitive stocks. Although we remain underweighted in technology
stocks, we are adding to this sector selectively when the valuations make sense.
GALAXY STRATEGIC EQUITY FUND
DISTRIBUTION OF TOTAL NET ASSETS AS OF OCTOBER 31, 2000
[GRAPHIC OMITTED]
GALAXY STRATEGIC EQUITY FUND PIE CHART
REPURCHASE AGREEMENT & NET OTHER
ASSETS AND LIABILITIES 11%
BASIC MATERIALS 6%
ENERGY 8%
INDUSTRIAL 9%
FINANCE 13%
CONSUMER STAPLES 15%
OTHER COMMON STOCKS 5%
TECHNOLOGY 16%
CONSUMER CYCLICAL 17%
GALAXY STRATEGIC EQUITY FUND
GROWTH OF $10,000 INVESTMENT*
[GRAPHIC OMITTED]
GALAXY STRATEGIC EQUITY MOUNTAIN CHART
EDGAR REPRESENTATION OF DATA POINTS IN PRINTED GRAPHIC
GALAXY STRATEGIC GALAXY STRATEGIC GALAXY STRATEGIC
S&P 500 EQUITY FUND- EQUITY FUND- EQUITY FUND-
INDEX RETAIL A SHARES RETAIL B SHARES TRUST SHARES
3/04/98 10000 9625 10000 10000
4/30/98 10619 9788 9579 10201
10/31/98 10577 9263 9048 9667
4/30/99 12937 10925 10792 11422
10/31/99 13291 9564 9373 10019
4/30/00 14245 10771 10678 11305
10/31/00 14099 11581 11447 12192
* SINCE INCEPTION ON 3/4/98 FOR TRUST, RETAIL A AND RETAIL B SHARES.
PERFORMANCE FIGURES FOR RETAIL A SHARES INCLUDE THE EFFECT OF THE MAXIMUM
3.75% FRONT-END SALES CHARGE. PERFORMANCE FIGURES FOR RETAIL B SHARES REFLECT
THE DEDUCTION OF THE 3.00% CONTINGENT DEFERRED SALES CHARGE (APPLICABLE TO
SHARES REDEEMED DURING THE THIRD YEAR AFTER PURCHASE) AS IF SHARES WERE
REDEEMED ON OCTOBER 31, 2000. THE S&P 500 INDEX IS AN UNMANAGED INDEX IN
WHICH INVESTORS CANNOT INVEST. RESULTS FOR THE INDEX DO NOT REFLECT THE
INVESTMENT MANAGEMENT FEES AND OTHER EXPENSES INCURRED BY THE FUND.
12
<PAGE>
PORTFOLIO REVIEWS
GALAXY EQUITY VALUE FUND
BY G. JAY EVANS, CFA
PORTFOLIO MANAGER
[PHOTO OMITTED - G. JAY EVANS]
G. JAY EVANS HAS MANAGED THE GALAXY EQUITY VALUE FUND SINCE APRIL OF 1993. HE
HAS MANAGED VALUE-ORIENTED PORTFOLIOS FOR FLEET INVESTMENT ADVISORS INC., AND
ITS PREDECESSORS, SINCE 1978.
From the start of the reporting period through the first half of 2000,
demand held strong for stocks of high-tech communications, data processing, and
Internet equipment firms. Growth portfolios concentrated in technology positions
performed well, while portfolios invested over the rest of the market earned
lackluster total returns. Then, as successive interest rate hikes, higher oil
prices, and a strong dollar slowed the demand for technology, investors focused
on the vulnerability of these high-multiple, high-expectation stocks to
potential earnings disappointments.
Under such conditions, the lower-priced value sector looked relatively
attractive to investors and a significant movement to value commenced during the
summer months. Utilities performed particularly well, followed by energy and
health care as we entered the fall. Although an underweighting in the technology
sector versus its market benchmark diminished the performance of the Galaxy
Equity Value Fund at the start of the reporting period, the Fund's emphasis on
value-oriented sectors and strong stock selection within those sectors improved
total returns in the months that followed.
For the 12-months ended October 31, 2000, Trust Shares of the Fund earned
a total return of 8.22%. For the same period, its Retail A Shares returned 7.83%
before deducting the maximum 3.75% front-end sales charge, and its Retail B
Shares returned 7.12% before deducting the maximum 5.00% contingent deferred
sales charge. (Please see the chart on page 4 for total returns after deducting
the front-end sales charge and the chart on page 5 for total returns after
deducting the contingent deferred sales charge.) Over the same time, the average
multi-cap value fund tracked by Lipper returned 10.98% and the S&P 500 Index,
which is more representative of growth-oriented firms, returned 6.08%.
HELP FROM OIL AND FINANCIAL STOCKS
Of particular help to Fund total returns was an emphasis on and good
selectivity in the energy and financial sectors. Oil-service stocks were
especially strong as oil prices rose and inventories tightened. Financial stocks
gained in anticipation of a soft economic landing that could help interest rates
to fall.
Holdings in the communications, health care, and utility sectors also
performed especially well against comparable segments of the S&P 500 Index.
These positives helped offset the effect of an underweighting in the strongly
performing utility sector and an emphasis on the oversold consumer cyclical
sector, which performed poorly as investors questioned the resilience of
consumer spending in the face of rising interest rates.
VALUE RETURNS TO FAVOR
The historically wide disparity in price/earnings valuations that now
exists between growth and value stocks should continue to close, as the outlook
for interest rates eases and investors become more confident of an economic soft
landing. Value issues should also benefit from a modest acceleration in earnings
growth that now contrasts with the sizeable earnings deceleration forecast for
many growth companies. Furthermore, as the increasingly competitive environment
aided by the Internet and e-commerce challenges the traditional blue-chip market
leaders, market dominance may count for less in the future -- a change that
should benefit value investors.
As the outlook for value improves, the Fund will be supported by a strong
research effort focused on finding overlooked, undervalued companies that are
experiencing improvements in profitability. This effort will be helped by a
sophisticated valuation system designed to identify both underpriced and
overpriced issues.
13
<PAGE>
PORTFOLIO REVIEWS
GALAXY EQUITY VALUE FUND
DISTRIBUTION OF TOTAL NET ASSETS AS OF OCTOBER 31, 2000
[GRAPHIC OMITTED]
GALAXY EQUITY VALUE FUND PIE CHART
BASIC MATERIALS 3%
COMMUNICATIONS 3%
REPURCHASE AGREEMENT & NET OTHER
ASSETS AND LIABILITIES 2%
CONSUMER STAPLES 8%
INDUSTRIAL 8%
ENERGY 13%
CONSUMER CYCLICAL 15%
FINANCE 18%
TECHNOLOGY 30%
GALAXY EQUITY VALUE FUND
GROWTH OF $10,000 INVESTMENT*
[GRAPHIC OMITTED]
GALAXY EQUITY VALUE MOUNTAIN CHART
EDGAR REPRESENTATION OF DATA POINTS IN PRINTED GRAPHIC
GALAXY EQUITY GALAXY EQUITY GALAXY EQUITY
S&P 500 VALUE FUND VALUE FUND VALUE FUND
INDEX RETAIL A SHARES RETAIL B SHARES TRUST SHARES
9/01/88 10000 9625 10000
10/31/88 10731 10019 10410
10/31/89 13552 11441 11887
10/31/90 12537 10362 10766
10/31/91 16737 13517 14045
10/31/92 18404 14282 14839
10/31/93 21148 17307 17982
10/31/94 21960 18167 18889
10/31/95 27760 21948 10000 22915
10/31/96 34450 26663 10081 27968
10/31/97 45512 33233 11898 36321
10/31/98 55752 41216 16645 43453
10/31/99 69669 43486 17169 46074
10/31/00 73905 46891 18507 49861
* SINCE INCEPTION ON 9/1/88 FOR TRUST AND RETAIL A SHARES. SINCE INCEPTION ON
3/4/96 FOR RETAIL B SHARES. PERFORMANCE FIGURES FOR RETAIL A SHARES INCLUDE
THE EFFECT OF THE MAXIMUM 3.75% FRONT-END SALES CHARGE. PERFORMANCE FIGURES
FOR RETAIL B SHARES REFLECT THE DEDUCTION OF THE 2.00% CONTINGENT DEFERRED
SALES CHARGE (APPLICABLE TO SHARES REDEEMED DURING THE FIFTH YEAR AFTER
PURCHASE) AS IF SHARES WERE REDEEMED ON OCTOBER 31, 2000. THE S&P 500 INDEX
IS AN UNMANAGED INDEX IN WHICH INVESTORS CANNOT INVEST. RESULTS FOR THE INDEX
DO NOT REFLECT THE INVESTMENT MANAGEMENT FEES AND OTHER EXPENSES INCURRED BY
THE FUND.
GALAXY EQUITY GROWTH FUND
BY BOB ARMKNECHT
PORTFOLIO MANAGER
[PHOTO OMITTED - BOB ARMKNECHT]
BOB ARMKNECHT HAS BEEN MANAGING THE GALAXY EQUITY GROWTH FUND SINCE ITS
INCEPTION IN DECEMBER OF 1990. HE HAS MANAGED EQUITY PORTFOLIOS FOR FLEET
INVESTMENT ADVISORS INC., AND ITS PREDECESSORS, SINCE 1988.
Broad portfolio diversification and strong stock selection helped the
Galaxy Equity Growth Fund earn strong total returns for the 12-months ended
October 31, 2000, and far outpace the total returns for both its market
benchmark and other funds with similar investment objectives.
For the period, the Fund's Trust Shares earned a total return of 18.63%.
Over the same time, its Retail A Shares earned 18.18%, before deducting the
maximum 3.75% front-end sales charge, and its Retail B Shares earned 17.29%,
before deducting the maximum 5.00% contingent deferred sales charge. During the
period, Prime A Shares of the Fund earned 18.36% before deducting the maximum
5.50% front-end sales charge, and the Fund's Prime B Shares earned a total
return of 17.48% before deducting the 5.00% maximum contingent deferred sales.
(Please see the charts on page 4 for total returns after deducting the
applicable front-end sales charge and the charts on pages 5 and 6 for total
returns after deducting the applicable contingent deferred sales charge.)
Over the same period, the average total return for large-cap core funds
tracked by Lipper was 9.68% and the S&P 500 Index earned a total return of
6.08%.
DIVERSIFICATION KEY AS LEADERSHIP CHANGED
In the first half of the reporting period, investors favored sectors with
strong potential for earnings growth. In this environment, the Fund benefited
from a diversified exposure to growth areas of the economy that included
overweightings in top-performing areas like energy and health care.
Within these sectors, investors generally preferred industry leaders,
where we tend to focus the Fund's investments. Outperformance by holdings in the
technology, consumer staples, and communications areas -- where the Fund had
neutral weightings -- further enhanced returns and helped offset a disappointing
performance from individual issues within the portfolio. During this time, we
took profits in selected energy and technology stocks, used some of the proceeds
to buy drug and retail stocks that looked attractive, and added the remainder to
the Fund's cash position.
When market leadership began to shift in the spring of 2000, the Fund
continued to benefit both from our diversification strategy and from our
continued emphasis on companies with above-average growth potential. In addition
to strong returns from a sizable energy position, an outperformance by
individual technology, health care and financial stocks helped offset an
underperformance by consumer staples stocks. As the prices for technology stocks
weakened, we used some of the Fund's cash to take advantage of new opportunities
in the sector.
14
<PAGE>
The Fund's large energy weighting continued to boost total returns until
the very end of the reporting period, along with outperformances from individual
energy positions. As interest rates edged lower in the summer and fall of 2000,
solid gains from the financial sector further enhanced total returns and helped
offset a disappointing performance by consumer cyclical and telephone
communications stocks. At this point, we trimmed holdings in certain retail,
industrial, and technology stocks to add financial stocks with better price
potential. Within the technology sector and other groups, we traded stocks to
recognize capital losses that could minimize year-end capital gains
distributions.
ABOVE-AVERAGE EARNINGS POTENTIAL
When the reporting period ended, the Fund was overweighted in the energy,
health care, and capital goods sectors and underweighted in stocks of consumer
staples, consumer cyclical, technology, and basic materials firms. By taking
advantage of new opportunities that arose as market leadership continued to
change, we have been able to significantly enhance the quality of the Fund's
investments.
As in the previous year, we plan to maintain a broadly diversified
portfolio of leading companies with above-average earnings potential in
industries that we expect to outperform as the economic climate changes.
GALAXY EQUITY GROWTH FUND
DISTRIBUTION OF TOTAL NET ASSETS AS OF OCTOBER 31, 2000
[GRAPHIC OMITTED]
GALAXY EQUITY GROWTH FUND PIE CHART
UTILITIES 2%
CONSUMER CYCLICAL 7%
ENERGY 10%
TECHNOLOGY 14%
COMMUNICATIONS 14%
INDUSTRIAL 14%
FINANCE 16%
REPURCHASE AGREEMENT & NET
OTHER ASSETS AND LIABILITIES 3%
CONSUMER STAPLES 20%
GALAXY EQUITY GROWTH FUND
GROWTH OF $10,000 INVESTMENT*
[GRAPHIC OMITTED]
GALAXY EQUITY GROWTH MOUNTAIN CHART
EDGAR REPRESENTATION OF DATA POINTS IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GALAXY EQUITY GALAXY EQUITY GALAXY EQUITY GALAXY EQUITY GALAXY EQUITY
S&P 500 GROWTH FUND- GROWTH FUND- GROWTH FUND- GROWTH FUND- GROWTH FUND-
INDEX RETAIL A SHARES RETAIL B SHARES TRUST SHARES PRIME A SHARES PRIME B SHARES
<S> <C> <C> <C> <C> <C> <C>
12/14/90 10000 9625 10000
10/31/91 12358 11683 12139
10/31/92 13589 12747 13244
10/31/93 15615 13840 14380
10/31/94 16215 14494 15070
10/31/95 20497 18051 10000 18849
10/31/96 23319 21753 10102 22813
10/31/97 30807 28629 11856 30151
10/31/98 37739 34224 16812 36099 9450 10000
10/31/99 52243 41897 20175 44474 12028 12179
10/31/00 55419 49516 23798 52758 14236 14496
</TABLE>
* SINCE INCEPTION ON 12/14/90 FOR TRUST AND RETAIL A SHARES. SINCE INCEPTION ON
3/4/96 FOR RETAIL B SHARES. SINCE INCEPTION ON 11/1/98 FOR PRIME A SHARES AND
PRIME B SHARES. PERFORMANCE FIGURES FOR RETAIL A SHARES INCLUDE THE EFFECT OF
THE MAXIMUM 3.75% FRONT-END SALES CHARGE. PERFORMANCE FIGURES FOR PRIME A
SHARES INCLUDE THE EFFECT OF THE MAXIMUM 5.50% FRONT-END SALES CHARGE.
PERFORMANCE FIGURES FOR RETAIL B AND PRIME B SHARES REFLECT THE DEDUCTION OF
THE 2.00% CONTINGENT DEFERRED SALES CHARGE (APPLICABLE TO SHARES REDEEMED
DURING THE FIFTH YEAR AFTER PURCHASE) AND THE 4.00% CONTINGENT DEFERRED SALES
CHARGE (APPLICABLE TO SHARES REDEEMED DURING THE SECOND YEAR AFTER PURCHASE),
RESPECTIVELY, AS IF SHARES WERE REDEEMED ON OCTOBER 31, 2000. THE S&P 500
INDEX IS AN UNMANAGED INDEX IN WHICH INVESTORS CANNOT INVEST. RESULTS FOR THE
INDEX DO NOT REFLECT THE INVESTMENT MANAGEMENT FEES AND OTHER EXPENSES
INCURRED BY THE FUND.
15
<PAGE>
PORTFOLIO REVIEWS
GALAXY GROWTH FUND II
BY GENE TAKACH AND TED OBER
PORTFOLIO MANAGERS
[PHOTO OMITTED - EUGENE D. TAKACH]
EUGENE D. TAKACH, WHO HAS OVER 30 YEARS OF EXPERIENCE IN INVESTMENT
MANAGEMENT RESEARCH ANALYSIS AND SECURITIES TRADING, HAS BEEN A PORTFOLIO
MANAGER WITH FLEET INVESTMENT ADVISORS INC., AND ITS PREDECESSORS, SINCE 1971.
[PHOTO OMITTED - THEODORE E. OBER]
THEODORE E. OBER, WHO HAS OVER 11 YEARS OF EXPERIENCE IN INVESTMENT MANAGEMENT
AND RESEARCH ANALYSIS, HAS BEEN A RESEARCH ANALYST, FUND MANAGER AND SENIOR FUND
MANAGER WITH FLEET INVESTMENT ADVISORS INC., AND ITS PREDECESSORS, SINCE 1987
MR. TAKACH AND MR. OBER HAVE CO-MANAGED THE FUND SINCE IT BEGAN OPERATIONS IN
1996.
The Galaxy Growth Fund II seeks to provide capital appreciation by
investing in a diversified portfolio of stocks with small- to medium-sized
market capitalizations that are believed to have above-average growth potential.
During the 12-month reporting period, the Fund benefited from a shift in market
leadership that favored small- and mid-sized firms and from a strong emphasis on
technology stocks, which outperformed in the first half of the period. These
positives, combined with strong performances by many individual holdings in its
portfolio, helped the Fund earn outstanding total returns that outpaced those
for its market benchmark and other funds with similar investment objectives by
wide margins.
For the 12-months ended October 31, 2000, the Fund's Trust Shares earned a
total return of 51.00%. For the period June 26, 2000 (date of initial issuance)
through October 31, 2000, Retail A Shares of the Fund earned 8.91%, before
deducting the 3.75% maximum front-end sales charge, and Retail B Shares of the
Fund earned 8.76%, before deducting the 5.00% maximum contingent deferred sales
charge. The total return for BKB Shares of the Fund for the 12 months ended
October 31, 2000 was 50.89%. (Please see the chart on page 4 for total returns
after deducting the front-end sales charge and the chart on page 5 for total
returns after deducting the contingent deferred sales charge.)
Over the same 12-month period, the average total return for mid-cap growth
funds tracked by Lipper was 37.79% and the S&P 500 Index earned a total return
of 6.08%.
EARLY FOCUS ON TECHNOLOGY
After underperforming for several years, stocks of small- and mid-sized
firms outperformed for the 12-month reporting period. In the first half of the
period, this was due largely to strong gains by technology firms in those market
sectors. Later on, small- and mid-cap stocks benefited as investors recognized
the exceptional value that the stocks offered as compared to large-cap growth
stocks that had become extremely expensive versus company earnings. In addition
to an overweighting in technology stocks and strong stock selection, the Fund
benefited during the period from an underweighting in financial stocks, which
underperformed.
When the period began, the Fund was heavily invested in the technology
area. This emphasis, plus strong performances by individual technology and
biotechnology stocks (including QLogic, Emulex, Verisign, Cree Inc., and
Millennium Pharmaceutical) significantly boosted the Fund's total returns as
technology stocks led market gains from November of 1999 into March of 2000.
Although the large technology weighting hurt total returns when the sector
retreated in the spring, the damage was reduced by profit-taking we had
initiated in February.
With the proceeds from sales of technology stocks, we increased the Fund's
energy position, which outperformed in the months that followed. We also added
investments in specialty retail firms at this time. When technology prices were
more attractive in June of 2000, we took advantage of selected investment
opportunities there. We later increased holdings in the biotech sector on market
weakness and added to investments in the energy sector.
MORE VALUE IN SMALL- AND MID-SIZED FIRMS
Although stocks of small- and mid-sized firms have not performed well in
recent months, we believe that these sectors still represent strong value versus
stocks of large-cap firms. The earnings growth for small- and mid-sized firms is
stronger than that for larger firms, while the prices for stocks in those
sectors are more attractive than prices for large-cap stocks.
In the months ahead, we plan to remain focused on technology stocks with
the best growth potential -- including stocks of storage-area networking,
switching, and fiber optics firms. We also expect to emphasize the specialty
retail sector, which should benefit from lower interest rates, as well as
investments in biotech companies and energy firms involved in exploration.
16
<PAGE>
PORTFOLIO REVIEWS
GALAXY GROWTH FUND II
DISTRIBUTION OF TOTAL NET ASSETS AS OF OCTOBER 31, 2000
[GRAPHIC OMITTED]
GALAXY GROWTH FUND II PIE CHART
OTHER COMMON STOCKS 3%
CONSUMER STAPLES 7%
REPURCHASE AGREEMENT, PREFERRED STOCK &
NET OTHER ASSETS AND LIABILITIES 8%
INDUSTRIAL 9%
ENERGY 10%
COMMUNICATIONS 11%
CONSUMER CYCLICAL 30%
TECHNOLOGY 22%
GALAXY GROWTH FUND II
GROWTH OF $10,000 INVESTMENT*
[GRAPHIC OMITTED]
GALAXY GROWTH FUND II MOUNTAIN CHART
EDGAR REPRESENTATION OF DATA POINTS IN PRINTED GRAPHIC
RUSSELL GALAXY GROWTH GALAXY GROWTH GALAXY GROWTH GALAXY GROWTH
2000 FUND II- FUND II- FUND II- FUND II-
INDEX RETAIL A SHARES RETAIL B SHARES TRUST SHARES BKB SHARES
3/28/96 10000 10000 10000
10/31/96 10373 11328 11328
10/31/97 13416 13625 13625
10/31/98 11827 11405 11405
10/31/99 14397 16931 16931
6/30/00 16513 10000 10000 23272 23272
10/31/00 15951 10486 10376 25566 25548
* SINCE INCEPTION ON 3/28/96 FOR TRUST AND BKB SHARES. SINCE INCEPTION ON
6/26/00 FOR RETAIL A AND RETAIL B SHARES. PERFORMANCE FIGURES FOR RETAIL A
SHARES INCLUDE THE EFFECT OF THE MAXIMUM 3.75% FRONT-END SALES CHARGE.
PERFORMANCE FIGURES FOR RETAIL B SHARES REFLECT THE DEDUCTION OF THE 5.00%
CONTINGENT DEFERRED SALES CHARGE (APPLICABLE TO SHARES REDEEMED DURING THE
FIRST YEAR AFTER PURCHASE) AS IF SHARES WERE REDEEMED ON OCTOBER 31, 2000.
THE RUSSELL 2000 INDEX IS AN UNMANAGED INDEX IN WHICH INVESTORS CANNOT
INVEST. RESULTS FOR THE INDEX DO NOT REFLECT THE INVESTMENT MANAGEMENT FEES
AND OTHER EXPENSES INCURRED BY THE FUND.
GALAXY SMALL CAP VALUE FUND
BY PETER LARSON
PORTFOLIO MANAGER
[PHOTO OMITTED - PETER LARSON]
PETER LARSON HAS MANAGED THE GALAXY SMALL CAP VALUE FUND SINCE 1993. HE HAS
MANAGED SMALL COMPANY PORTFOLIOS FOR FLEET INVESTMENT ADVISORS INC., AND ITS
PREDECESSORS, SINCE 1981.
As investor interest shifted over the 12-months ended October 31, 2000,
the Galaxy Small Cap Value Fund benefited from making the most of changes within
the technology sector and staying focused on stocks whose prices were attractive
versus the earnings potential of their firms. With strong performance from many
individual issues as well, the Fund earned strong total returns for the
reporting period that outpaced those for both its market benchmark and other
funds with similar investment objectives.
Over the period, the Fund's Trust Shares earned a total return of 22.62%.
Over the same time, Retail A Shares of the Fund earned 21.96%, before deducting
the maximum 3.75% front-end sales charge, and Retail B Shares of the Fund earned
21.06% before deducting the maximum 5.00% contingent deferred sales charge.
During the period, Prime A Shares of the Fund earned a total return of 22.26%
before deducting the maximum 5.50% front-end sales charge, and Prime B Shares of
the Fund earned a total return of 21.46% before deducting the maximum 5.00%
contingent deferred sales charge. (Please see the charts on page 4 for total
returns after deducting the applicable front-end sales charge and the charts on
pages 5 and 6 for total returns after deducting the applicable contingent
deferred sales charge.)
These total returns compare to 21.15% returned for the period by the
average small-company value fund tracked by Lipper. The Russell 2000 Index,
which represents more growth-oriented stocks, earned a total return of 17.41%
during this time.
STAYING FOCUSED ON VALUE
As technology stocks soared at the end of 1999 and the beginning of 2000,
helping growth-oriented stocks outperform value issues, the Fund benefited from
a sizable position in technology stocks. An overweighting in energy stocks,
which enjoyed strong gains as oil prices rose, also contributed positively to
total returns, along with an underweighting in the poorly performing financial
group. Of added benefit were holdings in companies involved in mergers,
particularly in the consumer cyclical sector. When individual technology stocks
reached our price targets, we traded those issues for stocks with better value
-- emphasizing firms in the health care, utility, and financial sectors.
17
<PAGE>
PORTFOLIO REVIEWS
By March, when the prices of technology stocks began to fall, the Fund's
technology weighting had dropped significantly. Weakness in the technology
sector was further offset by continued gains from the Fund's energy stocks and
an outperformance by consumer staples stocks. As investors shifted from growth-
to value-oriented investments in the months that followed, the Fund enjoyed
strong total returns from holdings in the basic materials and consumer cyclical
sectors as well as further gains from its energy positions. These positives
offset the effect of underweighted positions in the strongly performing biotech
and hospital-management sectors. With further profit taking in technology
stocks, and sales of some energy positions, we increased holdings in utility
stocks and other stocks whose strong dividends could boost returns in a choppy
market.
VALUE STOCKS COULD OUTPERFORM
As the reporting period ended, both growth- and value-oriented stocks were
hurt by concerns about slower growth in the economy and corporate earnings.
While these concerns will probably persist in months to come, the prices for
many small-company issues already reflect an expected weakness in earnings and
so may have less room to fall than prices for stocks of larger firms.
Value-oriented investments in the small-cap area could hold up particularly well
in this environment.
Although we will watch for new investment opportunities that might arise
in the technology sector, we believe that, for the most part, the group remains
overpriced. In the meantime, we plan to emphasize stocks in economically
defensive sectors and continue boosting returns with dividend income.
GALAXY SMALL CAP VALUE FUND
DISTRIBUTION OF TOTAL NET ASSETS AS OF OCTOBER 31, 2000
[GRAPHIC OMITTED]
GALAXY SMALL CAP VALUE PIE CHART
TECHNOLOGY 5%
OTHER COMMON STOCKS 6%
CORPORATE BOND, REPURCHASE AGREEMENT &
NET OTHER ASSETS AND LIABILITIES 11%
ENERGY 12%
FINANCE 13%
CONSUMER CYCLICAL 14%
INDUSTRIAL 16%
CONSUMER STAPLES 18%
COMMUNICATIONS 5%
GALAXY SMALL CAP VALUE FUND
GROWTH OF $10,000 INVESTMENT*
[GRAPHIC OMITTED]
GALAXY SMALL CAP VALUE MOUNTAIN CHART
EDGAR REPRESENTATION OF DATA POINTS IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
RUSSELL GALAXY SMALL CAP GALAXY SMALL CAP GALAXY SMALL CAP GALAXY SMALL CAP GALAXY SMALL CAP
2000 VALUE FUND- VALUE FUND- VALUE FUND- VALUE FUND- VALUE FUND-
INDEX RETAIL A SHARES RETAIL B SHARES TRUST SHARES PRIME A SHARES PRIME B SHARES
<S> <C> <C> <C> <C> <C> <C>
12/14/92 10000 9625 10000
10/31/93 10890 10789 11212
10/31/94 11548 10967 11420
10/31/95 14601 13299 13878
10/31/96 16612 15799 16568
10/31/97 17299 17416 18264
10/31/98 24634 25988 10000 27367 9450 10000
10/31/99 22152 22026 10004 23325 9998 10018
10/31/00 26009 26863 12288 28601 12224 12348
</TABLE>
* SINCE INCEPTION ON 12/14/92 FOR TRUST SHARES. SINCE INCEPTION ON 2/12/93 FOR
RETAIL A SHARES. SINCE INCEPTION ON 11/1/98 FOR RETAIL B, PRIME A AND PRIME B
SHARES. PERFORMANCE FIGURES FOR RETAIL A SHARES INCLUDE THE EFFECT OF THE
MAXIMUM 3.75% FRONT-END SALES CHARGE. PERFORMANCE FIGURES FOR PRIME A SHARES
INCLUDE THE EFFECT OF THE MAXIMUM 5.50% FRONT-END SALES CHARGE. PERFORMANCE
FIGURES FOR RETAIL B AND PRIME B SHARES REFLECT THE DEDUCTION OF THE 4.00%
CONTINGENT DEFERRED SALES CHARGE (APPLICABLE TO SHARES REDEEMED DURING THE
SECOND YEAR AFTER PURCHASE) AS IF SHARES WERE REDEEMED ON OCTOBER 31, 2000.
THE RUSSELL 2000 INDEX IS AN UNMANAGED INDEX IN WHICH INVESTORS CANNOT
INVEST. RESULTS FOR THE INDEX DO NOT REFLECT THE INVESTMENT MANAGEMENT FEES
AND OTHER EXPENSES INCURRED BY THE FUND.
18
<PAGE>
PORTFOLIO REVIEWS
GALAXY SMALL COMPANY EQUITY FUND
BY STEVE BARBARO
PORTFOLIO MANAGER
[PHOTO OMITTED - STEVE BERBARO]
STEVE BARBARO HAS MANAGED THE GALAXY SMALL COMPANY EQUITY FUND SINCE ITS
INCEPTION IN DECEMBER OF 1991. HE HAS MANAGED SMALL COMPANY PORTFOLIOS FOR FLEET
INVESTMENT ADVISORS INC., AND ITS PREDECESSORS, SINCE 1976.
As strong gains from technology stocks boosted returns for the
small-company growth sector in the first part of the reporting period, the
Galaxy Small Company Equity Fund benefited from an overweighting in technology
stocks and exceptional performances from individual holdings in the group. By
using profits from these holdings to add better-priced stocks from a broad range
of market sectors prior to the tech stock correction later in the period, we
minimized the effect of the correction on Fund total returns and made the most
of outperformances in other areas. As a result, the Fund earned exceptional
total returns for the 12-months ended October 31, 2000, that outpaced both its
market benchmark and other funds with similar investment objectives.
During the reporting period, Trust Shares of the Fund had a total return
of 39.43%. For the same period, Retail A Shares earned 38.89%, before deducting
the maximum 3.75% sales charge, and Retail B Shares earned 37.82%, before
deducting the maximum 5.00% contingent deferred sales charge. (Please see the
chart on page 4 for total returns after deducting the front-end sales charge and
the chart on page 5 for total returns after deducting the contingent deferred
sales charge.) For the same period small-cap growth funds tracked by Lipper
earned a total return of 38.41% and small-cap stocks in the Russell 2000 Index
returned 17.41%.
BROADENING THE PORTFOLIO
During the first months of the reporting period, the Fund benefited from a
focus on leading technology companies, which outperformed tech stocks as a
whole. Of further help were solid performances by the Fund's health care
positions and an underweighting in the lesser-performing financial group. These
positives offset the effect of an underweighting in the strongly performing
biotech group. As we took profits in technology stocks that had done well and in
interest-sensitive stocks of consumer-oriented firms, we added tech and consumer
stocks with better price potential -- as well as issues of energy, financial,
transportation, and capital goods firms.
These changes resulted in a reduced weighting in technology stocks, which
served the Fund well when the sector began to correct in April of 2000. Of
further help was an underweighting in stocks of Internet-related firms, which
bore the brunt of the sector's decline. At the same time, the Fund benefited
from an overweighting in energy stocks, which advanced on rising oil prices, and
from solid gains in the health care area.
As we continued to trim the tech sector as a whole, we added selective
investments in the sector with attractive prices. We continued to increase
stocks of energy, consumer, financial, and transportation firms -- while also
adding health care stocks. When investors recognized the many values available
in the small-cap sector during the summer of 2000, these additions and a
continued overweighting in energy firms added to Fund total returns.
SMALL-CAP SECTOR STILL ATTRACTIVE
As the reporting period ended, prices for stocks of small growth companies
remained very attractive versus the prices for large-cap growth stocks. While
slower economic growth may weaken the prices of small-cap stocks in months to
come, the decline may be less for those stocks than for the more expensive
large-cap sector. Once investors become less concerned about earnings
disappointments, and stock prices rebound, small-cap stocks could continue to
outperform.
In the meantime, we plan to look for additional opportunities in
financial, health care, transportation, and energy stocks that further market
weakness might bring. Once technology stocks become more attractive, we expect
to add investments there.
19
<PAGE>
PORTFOLIO REVIEWS
GALAXY SMALL COMPANY EQUITY FUND
DISTRIBUTION OF TOTAL NET ASSETS AS OF OCTOBER 31, 2000
[GRAPHIC OMITTED]
GALAXY SMALL COMPANY EQUITY PIE CHART
ENERGY 9%
COMMUNICATIONS 11%
REPURCHASE AGREEMENT & NET OTHER
ASSETS AND LIABILITIES 7%
TECHNOLOGY 13%
INDUSTRIAL 14%
CONSUMER CYCLICAL 19%
CONSUMER STAPLES 19%
OTHER COMMON STOCKS 1%
FINANCE 7%
GALAXY SMALL COMPANY EQUITY FUND
GROWTH OF $10,000 INVESTMENT*
[GRAPHIC OMITTED]
GALAXY SMALL COMPANY EQUITY MOUNTAIN CHART
EDGAR REPRESENTATION OF DATA POINTS IN PRINTED GRAPHIC
RUSSELL GALAXY SMALL COMPANY GALAXY SMALL COMPANY GALAXY SMALL COMPANY
2000 EQUITY FUND EQUITY FUND EQUITY FUND
INDEX RETAIL A SHARES RETAIL B SHARES TRUST SHARES
12/30/91 10000 9625 10000
10/31/92 10650 8460 8790
10/31/93 14101 11944 12410
10/31/94 14058 11937 12413
10/31/95 16638 15997 10000 16723
10/31/96 19400 19832 11789 20862
10/31/97 25090 23616 9874 24937
10/31/98 28015 24913 14344 26356
10/31/99 52243 31988 10332 34010
10/31/00 61339 27788 15647 29727
* SINCE INCEPTION ON 12/30/91 FOR TRUST AND RETAIL A SHARES. SINCE INCEPTION ON
3/4/96 FOR RETAIL B SHARES. PERFORMANCE FIGURES FOR RETAIL A SHARES INCLUDE
THE EFFECT OF THE MAXIMUM 3.75% FRONT-END SALES CHARGE. PERFORMANCE FIGURES
FOR RETAIL B SHARES REFLECT THE DEDUCTION OF THE 2.00% CONTINGENT DEFERRED
SALES CHARGE (APPLICABLE TO SHARES REDEEMED DURING THE FIFTH YEAR AFTER
PURCHASE) AS IF SHARES WERE REDEEMED ON OCTOBER 31, 2000. THE RUSSELL 2000
INDEX IS AN UNMANAGED INDEX IN WHICH INVESTORS CANNOT INVEST. RESULTS FOR THE
INDEX DO NOT REFLECT THE INVESTMENT MANAGEMENT FEES AND OTHER EXPENSES
INCURRED BY THE FUND.
GALAXY INTERNATIONAL EQUITY FUND
BY KEITH BANKS, CFA, CHIEF INVESTMENT OFFICER, FLEET INVESTMENT ADVISORS INC.
OECHSLE INTERNATIONAL ADVISORS, LLC SERVES AS THE SUB-ADVISOR FOR THE FUND.
[PHOTO OMITTED - KEITH BANKS]
KEITH BANKS IS CHIEF INVESTMENT OFFICER OF FLEET INVESTMENT ADVISORS, INC. AND
CHIEF EXECUTIVE OFFICER OF FLEET ASSET MANAGEMENT. PRIOR TO JOINING FLEET IN
2000, HE WAS MANAGING DIRECTOR AND HEAD OF U.S. EQUITIES FOR J.P. MORGAN
INVESTMENT MANAGEMENT. DURING HIS CAREER AT J.P. MORGAN, HE ALSO SERVED IN
VARIOUS ROLES INCLUDING EQUITY RESEARCH ANALYST, PORTFOLIO MANAGER, HEAD OF U.S.
EQUITY RESEARCH AND GLOBAL HEAD OF RESEARCH. HE BEGAN HIS INVESTMENT CAREER AS
AN EQUITY ANALYST AT HOME INSURANCE IN 1981. A CHARTERED FINANCIAL ANALYST, MR.
BANKS EARNED HIS B.A. FROM RUTGERS UNIVERSITY AND HIS M.B.A. FROM COLUMBIA
BUSINESS SCHOOL.
As world equity markets underperformed U.S. stocks over the 12-months
ended October 31, 2000, the Galaxy International Equity Fund enjoyed strong
total returns from many individual investments that helped the Fund outperform
its market benchmark. However, due to sizable investments in "new economy"
stocks from the technology, telecommunications, and media sectors -- which
corrected sharply during the reporting period -- the Fund underperformed funds
with a similar investment objective.
During the reporting period, the Fund's Trust Shares earned a total return
of (1.08)%. Over the same time, Retail A Shares of the Fund earned (1.49)%,
before deducting the maximum 3.75% front-end sales charge, and Retail B Shares
of the Fund earned (2.22)% before deducting the maximum 5.00% contingent
deferred sales charge. During the period, the Fund's Prime A Shares earned a
total return of (1.34)% before deducting the maximum 5.50% front-end sales
charge, and its Prime B Shares earned a total return of (2.02)% before deducting
the maximum 5.00% contingent deferred sales charge. The total return for
BKBShares of the Fund for the period June 19, 2000 (date of initial issuance)
through October 31, 2000 was (12.59)%. (Please see the charts on page 4 for
total returns after deducting the applicable front-end sales charge and the
charts on pages 5 and 6 for total returns after deducting the applicable
contingent deferred sales charge.) Those total returns compare with a return of
2.69% for the average international fund tracked by Lipper, and (2.90)% for the
EAFE Index.
COUNTRY WEIGHTINGS AID EARLY TOTAL RETURNS
Weightings for individual markets generally added to total returns,
particularly early in the reporting period. In the final months of 1999, the
Fund benefited from overweighted positions versus its market benchmark in
better-performing markets like Germany, Italy, and Sweden and from
underweightings in lesser-performing markets like the United Kingdom and
Switzerland. These contributions enhanced the positive effect of strong stock
selection in Europe and Japan, especially among telecommunications firms.
After further boosting total returns at the start of 2000, the Fund's
technology positions declined sharply in the spring. Although underweighted
positions in the United Kingdom and Switzerland remained beneficial, along with
an overweighted position in Germany, total returns were diminished by an
overweighted position in Japan, where stocks underperformed.
20
<PAGE>
PORTFOLIO REVIEWS
Throughout this time, we traded stocks of technology firms and other
stocks that had performed well for stocks with better price potential. In
choosing these investments, we focused on companies with strong potential for
improving total returns without lower interest rates. This included firms that
can benefit from corporate restructuring.
These changes eventually resulted in a net underweighting in Japan, which
served the Fund well as stocks there retreated in the final months of the
period. Of further help were continued overweightings in Italy and the
Netherlands and an underweighting in the United Kingdom, which offset
disappointing total returns from an overweighted position in Germany. Fund total
returns also benefited from gains by existing positions in pharmaceutical firms
and new holdings in the banking sector -- as well as an overall emphasis on
stocks that held up well against high short-term interest rates, rising oil
prices, and a strong U.S. dollar.
A BRIGHTER OUTLOOK ABROAD
Foreign stock prices were rallying as the reporting period ended,
reflecting news that weaker economic growth in the U.S. could favor investments
in faster-growing economies. We believe that global economic and profit growth
could continue to ebb through the second quarter of 2001, which would allow for
a gradual easing in oil prices and inflation fears worldwide. As the U.S.
economy slows, there is potential for the euro to appreciate significantly,
which would enhance total returns from foreign investments.
Given this environment, the Fund continues to focus on stocks in the
pharmaceuticals and consumer non-durable sectors. As before, we are looking for
healthy companies with unrecognized earnings potential, while balancing "old
economy" and "new economy" stocks. For the time being, we plan to remain
underweighted in stocks of Japanese firms, which generally have not fared well
during global slowdowns, and overweighted in European markets, which should
benefit from a stronger euro.
GALAXY INTERNATIONAL EQUITY FUND
DISTRIBUTION OF TOTAL NET ASSETS AS OF OCTOBER 31, 2000
[GRAPHIC OMITTED]
GALAXY INTERNATIONAL EQUITY PIE CHART
CANADA 2%
LATIN AMERICA 1%
FAR EAST 28%
EUROPE 44%
REPURCHASE AGREEMENT & NET OTHER
ASSETS AND LIABILITIES 6%
UNITED KINGDOM 19%
GALAXY INTERNATIONAL EQUITY FUND
GROWTH OF $10,000 INVESTMENT*
[GRAPHIC OMITTED]
GALAXY INTERNATIONAL EQUITY MOUNTAIN CHART
EDGAR REPRESENTATION OF DATA POINTS IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GALAXY INTERNATIONAL GALAXY INTERNATIONAL GALAXY INTERNATIONAL GALAXY INTERNATIONAL GALAXY INTERNATIONAL
EAFE EQUITY FUND- EQUITY FUND- EQUITY FUND- EQUITY FUND- EQUITY FUND-
INDEX RETAIL A SHARES RETAIL B SHARES TRUST SHARES PRIME A SHARES PRIME B SHARES
<S> <C> <C> <C> <C> <C> <C>
12/30/91 10000 9625 10000
10/31/92 8680 9297 9660
10/31/93 11970 11748 12207
10/31/94 13134 12795 13294
10/31/95 13125 12713 13291
10/31/96 14499 14093 14820
10/31/97 15212 16332 17280
10/31/98 17561 19778 10000 20998 9450 10000
10/31/99 20349 23949 12341 25623 12260 12374
6/30/00 22014 26541 13771 28478 13600 13817
10/31/00 19759 23592 12155 25346 12095 12215
GALAXY INTERNATIONAL
EQUITY FUND-
BKB SHARES
6/30/2000 10000
10/31/2000 8741
</TABLE>
* SINCE INCEPTION ON 12/30/91 FOR TRUST AND RETAIL A SHARES. SINCE INCEPTION ON
11/1/98 FOR RETAIL B, PRIME A AND PRIME B SHARES. SINCE INCEPTION ON 6/19/00
FOR BKBSHARES. PERFORMANCE FIGURES FOR RETAIL A SHARES INCLUDE THE EFFECT OF
THE MAXIMUM 3.75% FRONT-END SALES CHARGE. PERFORMANCE FIGURES FOR PRIME A
SHARES INCLUDE THE EFFECT OF THE MAXIMUM 5.50% FRONT-END SALES CHARGE.
PERFORMANCE FIGURES FOR RETAIL B AND PRIME B SHARES REFLECT THE DEDUCTION OF
THE 4.00% CONTINGENT DEFERRED SALES CHARGE (APPLICABLE TO SHARES REDEEMED
DURING THE SECOND YEAR AFTER PURCHASE) AS IF SHARES WERE REDEEMED ON OCTOBER
31, 2000. THE EAFE INDEX IS AN UNMANAGED INDEX IN WHICH INVESTORS CANNOT
INVEST. RESULTS FOR THE INDEX DO NOT REFLECT THE INVESTMENT MANAGEMENT FEES
AND OTHER EXPENSES INCURRED BY THE FUND.
21
<PAGE>
SHAREHOLDER SERVICES
"A WELL-BALANCED ASSET ALLOCATION PLAN MAY HELP TO CONTROL YOUR RISK WHILE
PURSUING YOUR GOALS."
AUTOMATIC INVESTMENT PROGRAM
The Golden Rule of investing is "pay yourself first." That is easy to do with
Galaxy's Automatic Investment Program. For as little as $50 per month deducted
directly from your checking, savings or bank money market account, you can
consistently and conveniently add to your Galaxy investment. When you establish
an Automatic Investment Program, the $2,500 initial investment requirement for
Galaxy is waived. Of course, such a program does not assure a profit and does
not protect against loss in a declining market.
DIVERSIFICATION
A fundamental investment practice is "diversification." A well-balanced asset
allocation plan may help to control your risk while pursuing your goals. Many
mutual funds offer a low-cost way to diversify your investments while you
benefit from professional management. Galaxy's comprehensive array of investment
choices can be used in combination to match the needs of nearly everyone.
EXCHANGE PRIVILEGES
As your investment needs change, you can conveniently exchange your shares in
one Fund for shares in another Fund at no cost (as long as you exchange within
the same share class).
CONSOLIDATED STATEMENTS
If you hold your shares directly with the Galaxy Funds, you will receive a
consolidated statement from Galaxy on a quarterly basis. If your shares are held
in a brokerage account, your Galaxy Funds will appear on your brokerage
statement.
YOUR FINANCIAL ADVISOR
Your financial advisor can discuss the Galaxy Funds with you and how they may
help you to achieve your financial goals. Please see your financial advisor if
you have any questions about this report or if you have any questions about your
account.
24-HOUR ACCESS TO REGISTERED REPRESENTATIVES
24 hours a day, seven days a week, 365 days a year, we are ready and available
to help. Our toll-free telephone lines offer round-the-clock access to Fund
information and services. Call toll-free 1-877-BUY-GALAXY (1-877-289-4252) for
information on initial purchases and current performance.
--------------------------------------------------------------------------------
Certain shareholder services may not be available to Trust, Prime A and Prime B
Share investors. Please consult your Fund Prospectus. Shares of the Funds are
distributed through Provident Distributors, Inc., member NASD and SIPC.
22
<PAGE>
SHAREHOLDER INFORMATION
[BEGIN SIDEBAR]
---------------------------
TRUSTEES
AND
EXECUTIVE OFFICERS
Dwight E. Vicks, Jr.
CHAIRMAN AND TRUSTEE
John T. O'Neill
PRESIDENT, TREASURER
AND TRUSTEE
Louis DeThomasis,
F.S.C., Ph.D.
TRUSTEE
Donald B. Miller
TRUSTEE
James M. Seed
TRUSTEE
Bradford S. Wellman
TRUSTEE
William Greilich
VICE PRESIDENT
W. Bruce
McConnel, Esq.
SECRETARY
INVESTMENT ADVISOR
Fleet Investment
Advisors Inc.
100 Federal Street
Boston, MA
02110
DISTRIBUTOR
Provident
Distributors, Inc.
3200 Horizon Drive
King of Prussia,
Pennsylvania 19406
ADMINISTRATOR
PFPC Inc.
4400 Computer Drive
Westborough,
Massachusetts 01581-5108
AUDITOR
Ernst & Young LLP
200 Clarendon Street
Boston, MA 02116
LEGAL COUNSEL
Drinker Biddle & Reath LLP
One Logan Square
18th and Cherry Streets
Philadelphia, PA 19103
---------------------------
[END SIDEBAR]
This report is submitted for the general information of shareholders of The
Galaxy Fund. It is not authorized for distribution to prospective investors
unless accompanied or preceded by an effective prospectus for each Fund of The
Galaxy Fund, which contains more information concerning the investment policies
and expenses of the Funds as well as other pertinent information. For complete
information, and before making an investment decision on any of the Funds of The
Galaxy Fund, you should request a prospectus from Provident Distributors, Inc.
by calling toll-free 1-877-BUY-GALAXY (1-877-289-4252). Read the prospectus
carefully before you invest.
SHARES OF THE FUNDS ARE NOT BANK DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR
ENDORSED BY, FLEETBOSTON FINANCIAL CORPORATION OR ANY OF ITS AFFILIATES, FLEET
INVESTMENT ADVISORS INC., OR ANY FLEET BANK. SHARES OF THE FUNDS ARE NOT
FEDERALLY INSURED BY, GUARANTEED BY, OBLIGATIONS OF OR OTHERWISE SUPPORTED BY
THE U.S. GOVERNMENT, THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL
RESERVE BOARD OR ANY OTHER GOVERNMENTAL AGENCY. INVESTMENT RETURN AND PRINCIPAL
VALUE WILL VARY AS A RESULT OF MARKET CONDITIONS OR OTHER FACTORS SO THAT SHARES
OF THE FUNDS, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
AN INVESTMENT IN THE FUNDS INVOLVES INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF
THE PRINCIPAL AMOUNT INVESTED.
[GRAPHIC OMITTED]
RECYCLE LOGO
This report was printed on recycled paper.
23
<PAGE>
This page left blank intentionally.
<PAGE>
ASSET ALLOCATION FUND
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 2000
SHARES VALUE
---------- ---------
COMMON STOCKS - 53.96%
TECHNOLOGY - 11.93%
170,000 Amgen, Inc.*........................... $ 9,849,375
80,000 Analog Devices, Inc.*.................. 5,200,000
180,000 Automatic Data Processing, Inc......... 11,756,250
240,000 EMC Corp.*............................. 21,375,000
180,000 Hewlett-Packard Co..................... 8,358,750
290,000 Intel Corp............................. 13,050,000
110,000 Microsoft Corp.*....................... 7,576,250
100,000 Sun Microsystems, Inc.*................ 11,087,500
130,000 Texas Instruments, Inc................. 6,378,125
-------------
94,631,250
-------------
COMMUNICATIONS - 10.86%
200,000 America OnLine, Inc.*.................. 10,086,000
380,000 Cisco Systems, Inc.*................... 20,472,500
160,000 Comcast Corp., Class A*................ 6,520,000
100,000 Corning, Inc........................... 7,650,000
60,000 Interpublic Group of Cos., Inc......... 2,576,250
140,000 JDS Uniphase Corp.*.................... 11,392,500
230,000 Lucent Technologies, Inc............... 5,361,875
120,001 Qwest Communications International,
Inc.*.................................. 5,835,049
140,000 SBC Communications, Inc................ 8,076,250
340,000 WorldCom, Inc.*........................ 8,075,000
1,900 XO Communications, Inc., Class A* ..... 64,095
-------------
86,109,519
-------------
CONSUMER STAPLES - 9.33%
262,100 Elan Corp. Plc, ADR*................... 13,612,819
100,000 Forest Laboratories, Inc., Class A* 13,250,000
100,000 Genzyme Corp.*......................... 7,100,000
110,000 Gillette Co............................ 3,836,250
20,000 Johnson & Johnson Co................... 1,842,500
132,400 Merck & Co., Inc....................... 11,907,725
120,000 PepsiCo, Inc........................... 5,812,500
290,000 Pfizer, Inc............................ 12,524,375
56,800 Procter & Gamble Co.................... 4,057,650
-------------
73,943,819
-------------
FINANCE - 8.15%
240,000 American International Group, Inc. .... 23,520,000
90,000 Bank of America Corp................... 4,325,625
127,500 Chase Manhattan Corp................... 5,801,250
373,333 Citigroup, Inc......................... 19,646,649
60,000 Fannie Mae............................. 4,620,000
145,000 Wells Fargo & Co....................... 6,715,312
-------------
64,628,836
-------------
SHARES VALUE
---------- ---------
ENERGY - 4.99%
100,000 Enron Corp............................. $ 8,206,250
70,000 Exxon Mobil Corp....................... 6,243,125
100,000 Halliburton Co......................... 3,706,250
160,000 Schlumberger, Ltd...................... 12,180,000
220,000 Williams Cos., Inc..................... 9,198,750
-------------
39,534,375
-------------
CONSUMER CYCLICAL - 4.83%
250,000 CVS Corp............................... 13,234,375
300,000 Home Depot, Inc........................ 12,900,000
80,000 McDonald's Corp........................ 2,480,000
170,000 Target Corp............................ 4,696,250
110,000 Walgreen Co............................ 5,018,750
-------------
38,329,375
-------------
INDUSTRIAL - 3.87%
280,000 General Electric Co.................... 15,347,500
270,000 Tyco International, Ltd................ 15,305,625
-------------
30,653,125
-------------
TOTAL COMMON STOCKS ................... 427,830,299
-------------
(Cost $269,670,735)
PAR VALUE
----------
U.S. GOVERNMENT AND AGENCY OBLIGATIONS - 19.91%
U.S. TREASURY BONDS - 8.11%
$ 500,000 7.63%, 02/15/07....................... 507,890
1,200,000 12.00%, 08/15/13....................... 1,641,852
3,450,000 7.50%, 11/15/16....................... 3,974,676
4,650,000 8.75%, 05/15/17....................... 5,975,761
7,220,000 8.88%, 08/15/17....................... 9,390,673
2,500,000 8.88%, 02/15/19....................... 3,287,525
6,000,000 8.75%, 05/15/20....................... 7,871,580
6,200,000 7.88%, 02/15/21....................... 7,545,586
5,900,000 8.13%, 08/15/21....................... 7,372,345
3,250,000 7.63%, 11/15/22....................... 3,891,062
4,875,000 7.13%, 02/15/23....................... 5,546,726
7,000,000 6.13%, 11/15/27....................... 7,158,340
150,000 6.13%, 08/15/29....................... 155,389
-------------
64,319,405
-------------
FEDERAL HOME LOAN
MORTGAGE CORPORATION - 2.95%
2,000,000 5.00%, 01/15/04........................ 1,916,840
4,800,000 6.25%, 07/15/04........................ 4,758,000
2,800,000 6.88%, 01/15/05........................ 2,835,896
1,000,000 7.05%, 06/08/05........................ 992,140
500,000 5.75%, 03/15/09........................ 469,375
3,725,000 6.63%, 09/15/09........................ 3,701,719
SEE NOTES TO FINANCIAL STATEMENTS.
25
<PAGE>
ASSET ALLOCATION FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2000
PAR VALUE VALUE
---------- ---------
FEDERAL HOME LOAN
MORTGAGE CORPORATION (CONTINUED)
$ 3,200,000 7.00%, 03/15/10........................ $ 3,270,560
827,993 7.50%, 07/01/15, Pool # E80965, Gold .. 833,938
27,542 7.50%, 08/01/15, Pool # E81252, Gold .. 27,740
852,390 8.00%, 09/01/15, Pool # E00881, Gold .. 868,100
2,234,836 6.00%, 11/01/28, Pool # C00680, Gold .. 2,097,259
645,466 7.00%, 04/01/29, Pool # C00756, Gold .. 632,757
992,988 7.50%, 01/01/30, Pool # C35185, Gold .. 992,362
-------------
23,396,686
-------------
FEDERAL NATIONAL
MORTGAGE ASSOCIATION - 2.92%
1,000,000 6.74%, 09/19/01, MTN................... 1,001,750
235,000 5.75%, 04/15/03........................ 231,503
1,000,000 6.49%, 01/19/06, MTN................... 980,690
500,000 7.24%, 01/04/07, MTN................... 497,495
2,000,000 6.63%, 10/15/07........................ 2,010,000
2,448,902 6.12%, 10/01/08, Pool # 380999......... 2,351,710
521,171 6.00%, 01/01/09, Pool # 269929......... 506,187
2,055,000 6.38%, 06/15/09........................ 2,013,592
1,000,000 7.25%, 01/15/10........................ 1,037,950
244,131 6.50%, 03/01/11, Pool # 343824......... 239,807
148,429 6.00%, 06/01/14, Pool # 484967......... 142,863
1,686,984 6.00%, 06/01/14, Pool # 499193......... 1,623,722
720,045 6.00%, 06/01/14, Pool # 500131......... 693,044
1,584,280 7.00%, 03/01/15, Pool # 535200......... 1,574,378
202,531 6.50%, 01/01/26, Pool # 303676......... 195,252
617,348 8.00%, 12/01/29, Pool # 535031......... 625,065
2,018,729 8.00%, 04/01/30, Pool # 526425......... 2,043,317
1,990,602 8.00%, 04/01/30, Pool # 531218......... 2,014,848
829,542 8.00%, 04/01/30, Pool # 534220......... 839,645
497,774 8.00%, 04/01/30, Pool # 537131......... 503,837
460,360 8.00%, 05/01/30, Pool # 534205......... 465,967
1,500,000 7.25%, 05/15/30........................ 1,590,000
-------------
23,182,622
-------------
GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION - 2.62%
170,040 6.00%, 04/15/13, Pool # 471839......... 164,407
209,213 6.50%, 05/15/13, Pool # 473566......... 206,336
173,443 6.50%, 06/15/13, Pool # 476470......... 171,058
282,709 6.50%, 08/15/13, Pool # 486453......... 278,822
67,043 6.50%, 11/15/13, Pool # 454228......... 66,122
187,222 6.50%, 11/15/13, Pool # 477529......... 184,648
787,556 6.50%, 11/15/13, Pool # 483663......... 776,727
210,859 6.50%, 11/15/13, Pool # 493623......... 207,959
2,538,130 7.00%, 11/15/13, Pool # 780921......... 2,538,917
397,496 6.50%, 07/15/14, Pool # 494014......... 391,283
316,333 9.00%, 12/15/17, Pool # 780201......... 331,950
77,823 7.50%, 06/15/23, Pool # 346618......... 78,309
469,891 7.50%, 01/15/26, Pool # 417191......... 472,090
186,973 6.50%, 01/15/29, Pool # 482909......... 180,487
2,313,885 6.00%, 03/15/29, Pool # 476986......... 2,180,096
877,823 6.50%, 03/15/29, Pool # 464613......... 847,371
1,001,214 6.50%, 04/15/29, Pool # 473682......... 966,481
903,492 6.50%, 04/15/29, Pool # 483349......... 872,150
PAR VALUE VALUE
---------- ---------
GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION (CONTINUED)
$ 1,686,966 6.50%, 04/15/29, Pool # 488234......... $ 1,628,445
2,351,464 6.50%, 05/15/29, Pool # 487199......... 2,269,891
912,124 7.00%, 05/15/29, Pool # 507929......... 899,008
969,997 7.00%, 09/15/29, Pool # 510394......... 956,049
1,465,969 7.50%, 09/15/29, Pool # 466164......... 1,470,997
944,927 7.50%, 09/15/29, Pool # 478707......... 948,168
93,597 7.50%, 09/15/29, Pool # 510409......... 93,919
611,614 7.50%, 09/15/29, Pool # 510424......... 613,712
936,643 7.50%, 09/15/29, Pool # 511482......... 939,856
-------------
20,735,258
-------------
U.S. TREASURY NOTES - 2.47%
500,000 6.63%, 05/31/02........................ 504,140
3,415,000 7.25%, 05/15/04........................ 3,561,606
3,240,000 7.25%, 08/15/04........................ 3,391,340
2,630,000 5.88%, 11/15/04........................ 2,631,762
3,350,000 7.50%, 02/15/05........................ 3,555,857
1,975,000 6.75%, 05/15/05........................ 2,048,134
1,300,000 7.00%, 07/15/06........................ 1,370,811
830,000 6.50%, 02/15/10........................ 869,101
1,625,000 5.75%, 08/15/10........................ 1,623,976
-------------
19,556,727
-------------
FEDERAL HOME LOAN BANK - 0.65%
4,900,000 6.75%, 02/01/02........................ 4,912,250
250,000 5.80%, 09/02/08........................ 237,047
-------------
5,149,297
-------------
FEDERAL FARM CREDIT BANK - 0.19%
1,500,000 5.88%, 07/02/01........................ 1,492,500
-------------
U.S. GOVERNMENT-BACKED BOND - 0.00%
25,000 Private Export Funding Corp., Series II
8.40%, 07/31/01........................ 25,312
-------------
TOTAL U.S. GOVERNMENT AND AGENCY
OBLIGATIONS ........................... 157,857,807
-------------
(Cost $156,135,164)
CORPORATE NOTES AND BONDS - 14.70%
500,000 Alcoa, Inc.
7.38%, 08/01/10........................ 505,625
200,000 AT&T Corp.
7.00%, 05/15/05........................ 195,250
2,250,000 AT&T Corp.
6.50%, 03/15/29........................ 1,771,875
350,000 Atlantic Richfield Co.
5.90%, 04/15/09........................ 325,500
1,000,000 Bank One Wisconsin, Bank Note, MTN
6.35%, 03/19/01........................ 998,750
SEE NOTES TO FINANCIAL STATEMENTS.
26
<PAGE>
ASSET ALLOCATION FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2000
PAR VALUE VALUE
---------- ---------
CORPORATE NOTES AND BONDS (CONTINUED)
$ 825,000 Barclays Bank Plc.
7.40%, 12/15/09........................ $ 820,875
1,200,000 Becton Dickinson & Co.
7.15%, 10/01/09........................ 1,177,500
675,000 Becton Dickinson & Co., Debenture
7.00%, 08/01/27........................ 602,437
525,000 Becton Dickinson & Co., Debenture
6.70%, 08/01/28........................ 450,187
250,000 Burlington Northern Santa Fe Corp.,
Series H
9.25%, 10/01/06........................ 272,500
200,000 Burlington Northern Santa Fe Corp.,
Debenture
6.88%, 02/15/16........................ 182,750
600,000 Burlington Northern Santa Fe Corp.
7.00%, 12/15/25........................ 533,250
1,000,000 Caterpillar Financial Services Corp.,
Series F, MTN
5.47%, 09/12/01........................ 990,000
1,700,000 Caterpillar Financial Services Corp.,
Series F, MTN
6.00%, 05/23/02........................ 1,680,875
300,000 CitiCorp, Subordinated Notes, MTN
6.38%, 11/15/08........................ 282,375
2,000,000 Coastal Corp.
7.50%, 08/15/06........................ 2,017,500
2,000,000 Coca-Cola Enterprises, Inc.
6.38%, 08/01/01........................ 1,990,000
1,000,000 Coca-Cola Enterprises, Inc., Debenture
7.13%, 08/01/17........................ 938,750
2,300,000 Colgate-Palmolive Co., Series C, MTN
5.27%, 12/01/03........................ 2,193,510
1,400,000 Commercial Credit Co.
6.50%, 08/01/04........................ 1,377,250
1,400,000 Conoco, Inc.
6.95%, 04/15/29........................ 1,305,500
4,300,000 DaimlerChrysler N.A. Holding Corp.
7.13%, 04/10/03........................ 4,300,000
245,000 DaimlerChrysler N.A. Holding Corp.,
Company Guarantee
7.20%, 09/01/09........................ 238,263
3,500,000 Diageo Capital Plc, Yankee
6.00%, 03/27/03........................ 3,420,550
3,000,000 Diageo Capital Plc, Yankee
6.13%, 08/15/05........................ 2,887,500
1,350,000 Dominion Resources Inc., Series B
7.63%, 07/15/05........................ 1,363,603
3,000,000 Emerson Electric Co.
5.85%, 03/15/09........................ 2,767,500
315,000 First Union Corp.
7.50%, 07/15/06........................ 315,394
265,000 First USA Bank, Subordinated Notes
7.65%, 08/01/03........................ 269,969
100,000 Ford Motor Credit Co.
6.75%, 05/15/05........................ 97,500
2,195,000 Ford Motor Credit Co., Senior Note
5.75%, 02/23/04........................ 2,093,481
PAR VALUE VALUE
---------- ---------
CORPORATE NOTES AND BONDS (CONTINUED)
$ 1,000,000 General Electric Capital Corp.
7.50%, 06/05/03........................ $ 1,020,000
1,500,000 General Electric Capital Corp., MTN
6.15%, 11/05/01........................ 1,494,375
800,000 General Electric Capital Corp., MTN
7.00%, 03/01/02........................ 804,000
135,000 General Electric Capital Corp.,
Series A, MTN
6.81%, 11/03/03........................ 135,506
250,000 General Electric Capital Corp.,
Series A, MTN
7.25%, 05/03/04........................ 254,063
2,045,000 General Motors Acceptance Corp.
6.75%, 02/07/02........................ 2,042,444
1,000,000 General Motors Acceptance Corp.
7.00%, 09/15/02........................ 1,001,250
200,000 General Motors Acceptance Corp.
6.63%, 10/01/02........................ 199,000
250,000 GTE Corp., Debenture
6.46%, 04/15/08........................ 238,125
1,000,000 GTE Corp., Series H
5.65%, 11/15/08........................ 896,250
750,000 Heinz (H.J.) Co.
6.88%, 01/15/03........................ 756,563
500,000 Hershey Foods Corp.
6.70%, 10/01/05........................ 497,500
1,300,000 Hershey Foods Corp.
7.20%, 08/15/27........................ 1,236,625
1,000,000 Hertz Corp., Senior Note
7.00%, 04/15/01........................ 998,750
550,000 Hewlett-Packard Co.
7.15%, 06/15/05........................ 551,375
1,000,000 IBM Corp.
7.50%, 06/15/13........................ 1,018,750
2,000,000 IBM Corp.
6.22%, 08/01/27........................ 1,972,500
1,405,000 IBM Credit Corp., MTN
6.45%, 11/12/02........................ 1,399,731
750,000 Illinois Tool Works, Inc.
5.75%, 03/01/09........................ 686,250
2,480,000 International Bank of Reconstruction
& Development
7.00%, 01/27/05........................ 2,523,400
500,000 International Paper Co.
7.00%, 06/01/01........................ 498,750
1,000,000 International Paper Co.
8.13%, 07/08/05 (C).................... 1,025,000
1,500,000 Lockheed Martin Corp.
6.85%, 05/15/01........................ 1,496,250
1,820,000 Lockheed Martin Corp.
8.20%, 12/01/09........................ 1,913,275
415,000 Lucent Technologies, Inc.
5.50%, 11/15/08........................ 351,194
2,025,000 McDonald's Corp., MTN
5.95%, 01/15/08........................ 1,918,688
SEE NOTES TO FINANCIAL STATEMENTS.
27
<PAGE>
ASSET ALLOCATION FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2000
PAR VALUE VALUE
---------- ---------
CORPORATE NOTES AND BONDS (CONTINUED)
$ 500,000 McDonald's Corp.
8.88%, 04/01/11........................ $ 560,000
500,000 Mead Corp.
6.84%, 03/01/37........................ 479,375
2,500,000 Minnesota Mining & Manufacturing Co.,
Debenture
6.38%, 02/15/28........................ 2,196,875
1,000,000 National City Bank of Kentucky,
Subordinated Bank Note
6.30%, 02/15/11........................ 896,250
1,515,000 National Rural Utilities
Cooperative Finance Corp.
7.38%, 02/10/03........................ 1,533,938
1,000,000 National Rural Utilities
Cooperative Finance Corp.
6.38%, 10/15/04........................ 982,500
1,000,000 NationsBank Corp.
7.00%, 09/15/01........................ 1,002,500
500,000 Northern Telecom, Ltd., Yankee Note
6.00%, 09/01/03........................ 485,000
160,000 Pepsi Bottling Holdings, Inc.
5.63%, 02/17/09 (C).................... 143,800
1,620,000 PepsiCo, Inc., MTN
5.75%, 01/15/08........................ 1,484,325
100,000 Phillips Petroleum Co.
8.50%, 05/25/05........................ 105,625
315,000 Phillips Petroleum Co.
8.75%, 05/25/10........................ 344,531
1,590,000 Pitney Bowes Credit Corp.
6.63%, 06/01/02........................ 1,588,013
1,800,000 Potomac Electric Power Co.
First Mortgage
6.50%, 09/15/05........................ 1,766,250
2,000,000 Potomac Electric Power Co.
First Mortgage
6.25%, 10/15/07........................ 1,940,000
1,500,000 Public Service Electric & Gas
Series A, MTN
7.19%, 09/06/02........................ 1,509,375
275,000 Qwest Capital Funding, Inc.
6.88%, 08/15/01........................ 275,000
2,000,000 Qwest Corp.
7.63%, 06/09/03 (C).................... 2,022,500
3,500,000 Sherwin-Williams Co., Senior Note
6.50%, 02/01/02........................ 3,465,000
1,900,000 Sherwin-Williams Co.
6.85%, 02/01/07........................ 1,869,125
1,000,000 Southwest Airlines Co.
8.75%, 10/15/03........................ 1,043,750
1,500,000 Sprint Capital Corp.
5.88%, 05/01/04........................ 1,432,500
375,000 Sprint Capital Corp.
6.90%, 05/01/19........................ 319,688
1,000,000 SunTrust Bank, Atlanta,
Subordinated Note, MTN
7.25%, 09/15/06........................ 1,003,750
PAR VALUE VALUE
---------- ---------
CORPORATE NOTES AND BONDS (CONTINUED)
$ 300,000 SunTrust Bank of Central Florida,
Subordinated Note
6.90%, 07/01/07........................ $ 293,625
1,000,000 Sysco Corp.
7.25%, 04/15/07........................ 1,023,750
1,250,000 Sysco Corp., Debenture
6.50%, 08/01/28........................ 1,098,438
2,000,000 Tele-Communications, Inc., Senior Note
7.25%, 08/01/05........................ 2,010,000
200,000 Tele-Communications, Inc., Debenture
9.80%, 02/01/12........................ 228,000
1,000,000 Texaco Capital, Inc.
8.50%, 02/15/03........................ 1,041,250
1,500,000 Time Warner, Inc., Debenture
6.63%, 05/15/29........................ 1,293,750
2,275,000 Tosco Corp.
8.13%, 02/15/30........................ 2,309,125
3,250,000 Unilever Capital Corp.
6.75%, 11/01/03........................ 3,237,813
2,000,000 United Telecommunications, Inc.
9.50%, 04/01/03........................ 2,100,000
260,000 Wal-Mart Stores, Inc.
6.75%, 05/15/02........................ 259,246
2,000,000 Wal-Mart Stores, Inc., Senior Note
6.75%, 05/15/02........................ 2,005,000
2,000,000 Wal-Mart Stores, Inc.
7.55%, 02/15/30........................ 2,082,500
3,875,000 WorldCom, Inc.
6.13%, 04/15/02........................ 3,826,563
-------------
TOTAL CORPORATE NOTES AND BONDS ....... 116,554,363
-------------
(Cost $119,370,084)
ASSET-BACKED AND MORTGAGE-BACKED SECURITIES - 3.36%
3,975,000 American Express Credit Account Master
Trust Series 1999-1, Class A
5.60%, 11/15/06........................ 3,849,509
500,000 Carco Auto Loan Master Trust
Series 1999-4, Class A
6.43%, 11/15/04........................ 497,738
500,000 Chemical Master Credit Card Trust I
Series 1995-3, Class A
6.23%, 04/15/05........................ 495,780
2,950,000 Chemical Master Credit Card Trust I
Series 1996-1, Class A
5.55%, 09/15/03........................ 2,941,681
700,000 Chemical Master Credit Card Trust I
Series 1996-2, Class A
5.98%, 09/15/08........................ 674,625
1,050,000 Citibank Credit Card Master Trust I
Series 1999-7, Class A
6.65%, 11/15/06........................ 1,044,750
1,500,000 Daimler-Benz Vehicle Trust
Series 1998-A, Class A-4
5.22%, 12/20/03........................ 1,473,270
SEE NOTES TO FINANCIAL STATEMENTS.
28
<PAGE>
ASSET ALLOCATION FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2000
PAR VALUE VALUE
---------- ---------
ASSET-BACKED AND MORTGAGE-BACKED SECURITIES (CONTINUED)
$ 2,000,000 DaimlerChrysler Auto Trust
Series 2000-A, Class A-3
7.09%, 12/06/03........................ $ 2,010,620
4,500,000 Discover Card Master Trust I
Series 1999-1, Class A
5.30%, 08/15/04........................ 4,417,020
1,000,000 Ford Credit Auto Owner Trust
Series 1999-D, Class A-4
6.40%, 10/15/02........................ 996,250
250,000 Ford Credit Auto Owner Trust
Series 1999-D, Class A-5
6.52%, 09/15/03........................ 249,375
25,000 Green Tree Financial Corp.
Series 1999-5, Class A-2
6.77%, 04/01/31........................ 24,914
2,500,000 MBNA Master Credit Card Trust
Series 1999-I, Class A
6.40%, 01/18/05........................ 2,491,400
2,500,000 MBNA Master Credit Card Trust
Series 1999-M, Class A
6.60%, 04/16/07........................ 2,490,288
440,000 Premier Auto Trust
Series 1999-2, Class A-4
5.59%, 02/09/04........................ 432,023
1,400,000 Premier Auto Trust
Series 1999-3, Class A-4
6.43%, 03/08/04........................ 1,393,868
213,584 Prudential Home Mortgage Securities
Series 1996-7, Class A, CMO
6.75%, 06/25/11........................ 211,914
448,060 Rural Housing Trust,
Series 1987-1, Class D, CMO
6.33%, 04/01/26........................ 437,698
500,000 Sears Credit Account Master Trust
Series 1996-4, Class A
6.45%, 10/16/06........................ 497,810
-------------
TOTAL ASSET-BACKED AND
MORTGAGE-BACKED SECURITIES ............ 26,630,533
-------------
(Cost $26,573,183)
FOREIGN BONDS (A) - 1.52%
900,000 Deutsche Telekom International Finance
7.75%, 06/15/05........................ 921,060
1,350,000 Deutsche Telekom International Finance
8.25%, 06/15/30........................ 1,385,438
2,000,000 Heinz (H.J.) Co., Euro-Bond
5.75%, 02/03/03........................ 1,947,200
220,000 Hydro-Quebec
8.63%, 05/20/02........................ 224,884
PAR VALUE VALUE
---------- ---------
FOREIGN BONDS (A) (CONTINUED)
$ 1,960,000 Kingdom of Spain
7.00%, 07/19/05........................ $ 1,984,500
1,550,000 Ontario Province
6.00%, 02/21/06........................ 1,501,562
220,000 Ontario Province, Senior
Unbsubordinated Notes
7.38%, 01/27/03........................ 223,300
1,570,000 Quebec Province
7.50%, 09/15/29........................ 1,593,550
2,500,000 Quebec Province, Senior Subordinated Notes
5.75%, 02/15/09........................ 2,292,000
-------------
TOTAL FOREIGN BONDS ................... 12,073,494
-------------
(Cost $12,065,134)
SHARES
----------
PREFERRED STOCK - 0.02%
8,000 Hartford Capital II, Series B.......... 197,000
-------------
TOTAL PREFERRED STOCK ................. 197,000
-------------
(Cost $200,000)
PAR VALUE
----------
COMMERCIAL PAPER (B) - 6.30%
$ 24,917,000 Bayer Corp.
6.64%, 11/01/00........................ 24,917,000
25,000,000 UBS Finance (DE) LLC
6.65%, 11/01/00........................ 25,000,000
-------------
TOTAL COMMERCIAL PAPER ................. 49,917,000
-------------
(Cost $49,917,000)
TOTAL INVESTMENTS - 99.77%................................ 791,060,496
-------------
(Cost $633,931,300)
NET OTHER ASSETS AND LIABILITIES- 0.23%................... 1,833,895
-------------
NET ASSETS - 100.00%...................................... $ 792,894,391
=============
--------------------------------------------
* Non-income producing security.
(A) U.S. Dollar-Denominated
(B) Discount yield at time of purchase.
(C) Securities exempt from registration pursuant to Rule 144A under the
Securities Act of 1933, as amended. These securities may only be resold,
in transactions exempt from registration, to qualified institutional
buyers. At October 31, 2000, these securities amounted to $3,191,300 or
0.40% of net assets.
ADR American Depositary Receipt
CMO Collateralized Mortgage Obligation
MTN Medium Term Note
SEE NOTES TO FINANCIAL STATEMENTS.
29
<PAGE>
EQUITY INCOME FUND
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 2000
SHARES VALUE
---------- ---------
COMMON STOCKS - 90.78%
FINANCE - 17.25%
41,000 American International Group, Inc. .... $ 4,018,000
120,000 Associates First Capital Corp., Class A 4,455,000
85,000 Citigroup, Inc......................... 4,473,125
170,000 Equity Office Properties Trust, REIT 5,121,250
60,000 Fannie Mae............................. 4,620,000
208,000 First Union Corp....................... 6,305,000
352,000 Firstar Corp........................... 6,930,000
55,000 Hartford Financial Services Group, Inc. 4,094,063
94,000 Spieker Properties, Inc., REIT......... 5,205,250
138,000 Wells Fargo & Co....................... 6,391,125
-------------
51,612,813
-------------
CONSUMER STAPLES - 15.59%
95,000 Baxter International, Inc.............. 7,807,812
135,000 Gillette Co............................ 4,708,125
85,000 Lilly (Eli) & Co....................... 7,596,875
100,000 Merck & Co., Inc....................... 8,993,750
115,000 PepsiCo, Inc........................... 5,570,312
185,000 Pfizer, Inc............................ 7,989,687
55,000 Procter & Gamble Co.................... 3,929,062
-------------
46,595,623
-------------
TECHNOLOGY - 14.98%
200,000 Automatic Data Processing, Inc......... 13,062,500
180,000 Hewlett-Packard Co..................... 8,358,750
180,000 Intel Corp............................. 8,100,000
75,000 International Business Machines Corp... 7,387,500
200,000 Molex, Inc., Class A................... 7,862,500
-------------
44,771,250
-------------
CONSUMER CYCLICAL - 9.53%
310,000 Ford Motor Co.......................... 8,098,750
115,000 Home Depot, Inc........................ 4,945,000
180,000 McDonald's Corp........................ 5,580,000
175,000 Target Corp............................ 4,834,375
110,000 Walgreen Co............................ 5,018,750
-------------
28,476,875
-------------
SHARES VALUE
---------- ---------
ENERGY - 9.32%
105,000 Baker Hughes, Inc...................... $ 3,609,375
245,000 Conoco, Inc., Class B.................. 6,660,937
75,000 Exxon Mobil Corp....................... 6,689,063
47,000 Schlumberger, Ltd...................... 3,577,875
124,000 Texaco, Inc............................ 7,323,750
-------------
27,861,000
-------------
COMMUNICATIONS - 8.27%
225,000 AT&T Corp.............................. 5,217,188
200,000 SBC Communications, Inc................ 11,537,500
12,083 Avaya, Inc.*........................... 162,365
145,000 Cisco Systems, Inc.*................... 7,811,875
-------------
24,728,928
-------------
INDUSTRIAL - 7.35%
125,000 General Electric Co.................... 6,851,563
225,000 Honeywell International, Inc........... 12,107,813
80,000 Ingersoll-Rand Co...................... 3,020,000
-------------
21,979,376
-------------
UTILITIES - 4.30%
175,000 TXU Corp............................... 6,485,938
250,000 Washington Gas Light Co................ 6,375,000
-------------
12,860,938
-------------
BASIC MATERIALS - 4.19%
210,000 Dow Chemical Co........................ 6,431,250
130,000 Weyerhaeuser Co........................ 6,101,875
-------------
12,533,125
-------------
TOTAL COMMON STOCKS ................... 271,419,928
-------------
(Cost $236,663,257)
PAR VALUE
----------
U.S. GOVERNMENT OBLIGATION - 0.66%
U.S. TREASURY BOND - 0.66%
$ 1,700,000 7.50%, 11/15/16........................ 1,958,536
-------------
TOTAL U.S. GOVERNMENT OBLIGATION 1,958,536
-------------
(Cost $1,677,156)
SEE NOTES TO FINANCIAL STATEMENTS.
30
<PAGE>
EQUITY INCOME FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2000
PAR VALUE VALUE
---------- ---------
REPURCHASE AGREEMENT - 8.59%
$25,669,000 Repurchase Agreement with:
State Street Bank
6.55%, Due 11/01/2000, dated 10/31/2000
Repurchase Price $25,673,670
(Collateralized by U.S. Treasury Note
7.00%, Due 07/15/2006;
Total Par $24,355,000
Market Value $26,187,251).............. $ 25,669,000
-------------
TOTAL REPURCHASE AGREEMENT ............ 25,669,000
-------------
(Cost $25,669,000)
TOTAL INVESTMENTS - 100.03%............................... 299,047,464
-------------
(Cost $264,009,413)
NET OTHER ASSETS AND LIABILITIES - (0.03)%................ (83,969)
-------------
NET ASSETS - 100.00%...................................... $ 298,963,495
=============
-------------------------------------------
* Non-income producing security.
REIT Real Estate Investment Trust
SEE NOTES TO FINANCIAL STATEMENTS.
31
<PAGE>
GROWTH AND INCOME FUND
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 2000
SHARES VALUE
---------- ---------
COMMON STOCKS - 93.57%
CONSUMER STAPLES - 21.81%
280,000 American Home Products Corp............ $ 17,780,000
286,000 Anheuser-Busch Cos., Inc............... 13,084,500
395,500 Avery Dennison Corp.................... 19,972,750
160,000 Coca-Cola Co........................... 9,660,000
580,000 Elan Corp. Plc, ADR*................... 30,123,750
85,000 Forest Laboratories, Inc., Class A* 11,262,500
258,650 Genzyme Corp.*......................... 18,364,150
160,000 Guidant Corp.*......................... 8,470,000
1,500,000 HEALTHSOUTH Corp.*..................... 18,000,000
172,400 Johnson & Johnson Co................... 15,882,350
310,000 Medtronic, Inc......................... 16,836,875
172,000 Merck & Co., Inc....................... 15,469,250
345,000 PepsiCo, Inc........................... 16,710,937
360,000 Pfizer, Inc............................ 15,547,500
215,000 Pharmacia Corp......................... 11,825,000
-------------
238,989,562
-------------
FINANCE - 14.89%
160,000 American International Group, Inc. .... 15,680,000
246,000 Bank of America Corp................... 11,823,375
430,000 Bank One Corp.......................... 15,695,000
110,000 Chubb Corp............................. 9,288,125
70,000 CIGNA Corp............................. 8,536,500
416,400 Citigroup, Inc......................... 21,913,050
290,000 Countrywide Credit Industries, Inc. ... 10,856,875
300,000 Fifth Third Bancorp.................... 15,412,500
227,000 Lincoln National Corp.................. 10,981,125
103,800 Morgan (J.P.) & Co., Inc............... 17,178,900
70,572 Standard & Poor's Depository Receipts.. 10,096,207
336,800 Wells Fargo & Co....................... 15,598,050
-------------
163,059,707
-------------
TECHNOLOGY - 13.01%
400,400 Avnet, Inc............................. 10,760,750
488,700 BMC Software, Inc.*.................... 9,926,719
568,500 Compaq Computer Corp................... 17,288,085
181,500 Computer Sciences Corp.*............... 11,434,500
310,000 Electronic Data Systems Corp........... 14,550,625
224,000 Hewlett-Packard Co..................... 10,402,000
130,500 International Business Machines Corp... 12,854,250
400,000 Intel Corp............................. 18,000,000
271,500 Microsoft Corp.*....................... 18,699,563
380,000 Texas Instruments, Inc................. 18,643,750
-------------
142,560,242
-------------
SHARES VALUE
---------- ---------
CONSUMER CYCLICAL - 10.16%
550,300 Bed, Bath & Beyond, Inc.*.............. $14,204,619
300,000 Cintas Corp............................ 13,912,500
500,000 Cooper Tire & Rubber Co................ 5,468,750
135,000 Eastman Kodak Co....................... 6,058,125
411,564 Ford Motor Co.......................... 10,752,109
225,000 Home Depot, Inc........................ 9,675,000
321,100 Lowe's Cos., Inc....................... 14,670,256
410,000 McDonald's Corp........................ 12,710,000
475,000 Sherwin-Williams Co.................... 10,301,562
950,000 Staples, Inc.*......................... 13,537,500
-------------
111,290,421
-------------
ENERGY - 9.85%
363,600 Baker Hughes, Inc...................... 12,498,750
220,000 BP Amoco Plc, ADR...................... 11,206,250
250,000 Enron Corp............................. 20,515,625
240,054 Exxon Mobil Corp....................... 21,409,816
225,000 Halliburton Co......................... 8,339,062
206,700 Kerr-McGee Corp........................ 13,500,094
150,000 Schlumberger, Ltd...................... 11,418,750
169,855 Transocean Sedco Forex, Inc............ 9,002,315
-------------
107,890,662
-------------
COMMUNICATIONS - 9.17%
700,000 AT&T Corp.............................. 16,231,250
250,000 Cisco Systems, Inc.*................... 13,468,750
422,000 Harris Corp............................ 13,372,125
100,000 JDS Uniphase Corp.*.................... 8,137,500
675,000 Motorola, Inc.......................... 16,832,813
100,000 Nortel Networks Corp................... 4,550,000
115,000 Qualcomm, Inc.*........................ 7,487,578
204,700 SBC Communications, Inc................ 11,808,631
148,840 Verizon Communications................. 8,604,813
-------------
100,493,460
-------------
INDUSTRIAL - 8.14%
33,181 Agilent Technologies, Inc.*............ 1,536,695
150,000 Danaher Corp.......................... 9,468,750
432,000 General Electric Co.................... 23,679,000
370,700 Honeywell International, Inc........... 19,948,294
366,300 Tyco International, Ltd................ 20,764,631
197,200 United Technologies Corp............... 13,767,025
-------------
89,164,395
-------------
SEE NOTES TO FINANCIAL STATEMENTS.
32
<PAGE>
GROWTH AND INCOME FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2000
SHARES VALUE
---------- ---------
BASIC MATERIALS - 4.61%
225,500 CenturyTel, Inc........................ $ 8,681,750
91 Crown Cork & Seal Co., Inc............. 830
128,000 Minnesota Mining & Manufacturing Co. .. 12,368,000
560,000 Pall Corp.............................. 12,075,000
245,000 Praxair, Inc........................... 9,126,250
643,200 Solutia, Inc........................... 8,200,800
--------------
50,452,630
--------------
TRANSPORTATION - 1.38%
151,500 British Airways Plc, ADR............... 6,722,813
318,000 Burlington Northern Santa Fe Corp. .... 8,446,875
--------------
15,169,688
--------------
CAPITAL GOODS - 0.55%
250,000 Hubbell, Inc., Class A................. 6,015,625
--------------
TOTAL COMMON STOCKS ................... 1,025,086,392
--------------
(Cost $727,400,734)
CONVERTIBLE PREFERRED STOCKS - 0.18%
80,000 Loral Space and Communications, Ltd.,
6.00% (A).............................. 1,354,960
37,000 Loral Space and Communications, Ltd.,
Series C, 6.00%........................ 626,669
--------------
TOTAL CONVERTIBLE PREFERRED STOCKS 1,981,629
--------------
(Cost $6,262,375)
PAR VALUE VALUE
---------- ---------
REPURCHASE AGREEMENT - 3.41%
$37,319,000 Repurchase Agreement with:
State Street Bank
6.55%, Due 11/01/2000, dated 10/31/2000,
Repurchase Price $37,325,790
(Collateralized by U.S Treasury Note
7.88%, Due 11/15/2001;
Total Par $34,385,000,
Market Value $38,067,737).............. $ 37,319,000
--------------
TOTAL REPURCHASE AGREEMENT ............. 37,319,000
--------------
(Cost $37,319,000)
TOTAL INVESTMENTS - 97.16%................................ 1,064,387,021
--------------
(Cost $770,982,109)
NET OTHER ASSETS AND LIABILITIES - 2.84%.................. 31,058,918
--------------
NET ASSETS - 100.00%...................................... $1,095,445,939
==============
------------------------------------------------
* Non-income producing security.
(A) Security exempt from registration pursuant to Rule 144A under the
Securities Act of 1933, as amended. This security may only be resold, in
a transaction exempt from registration, to qualified institutional
buyers. At October 31, 2000, this security amounted to $1,354,960, or
0.12% of net assets.
ADR American Depositary Receipt
SEE NOTES TO FINANCIAL STATEMENTS.
33
<PAGE>
STRATEGIC EQUITY FUND
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 2000
SHARES VALUE
---------- ---------
COMMON STOCKS - 89.28%
CONSUMER CYCLICAL - 17.06%
62,000 Centex Corp............................ $ 2,294,000
100,000 Circuit City Stores-Circuit City Group 1,325,000
37,500 CVS Corp............................... 1,985,156
30,200 General Motors Corp., Class H*......... 978,480
36,400 Hertz Corp., Class A................... 1,196,650
50,000 Lowe's Cos., Inc....................... 2,284,375
55,000 Newell Rubbermaid, Inc................. 1,055,312
315,000 Office Depot, Inc.*.................... 2,618,437
64,000 Sherwin-Williams Co.................... 1,388,000
60,000 TJX Cos., Inc.......................... 1,635,000
45,000 Williams-Sonoma, Inc.*................. 936,562
-------------
17,696,972
-------------
TECHNOLOGY - 16.00%
209,100 American Management Systems, Inc.* .... 4,521,788
85,000 BMC Software, Inc.*.................... 1,726,563
45,000 Dell Computer Corp.*................... 1,327,500
80,000 Diebold, Inc........................... 2,080,000
18,000 Hewlett-Packard Co..................... 835,875
12,000 International Business Machines Corp. . 1,182,000
40,500 Molex, Inc., Class A................... 1,592,156
58,000 Pitney Bowes, Inc...................... 1,721,875
51,000 Teradyne, Inc.*........................ 1,593,750
-------------
16,581,507
-------------
CONSUMER STAPLES - 14.65%
45,000 Albertson's, Inc....................... 1,065,937
75,000 Boston Scientific Corp.*............... 1,195,312
80,000 ConAgra, Inc........................... 1,710,000
85,000 Elan Corp. Plc, ADR*................... 4,414,687
160,000 HEALTHSOUTH Corp.*..................... 1,920,000
42,000 McKesson HBOC, Inc..................... 1,178,625
18,000 Merck & Co., Inc....................... 1,618,875
29,000 Procter & Gamble Co.................... 2,071,688
-------------
15,175,124
-------------
FINANCE - 13.33%
68,250 Charter One Financial, Inc............. 1,565,484
25,000 Freddie Mac............................ 1,500,000
75,000 John Hancock Financial Services, Inc.* 2,371,875
50,000 MBIA, Inc.............................. 3,634,375
82,000 UnumProvident Corp..................... 2,316,500
55,000 Washington Mutual, Inc................. 2,420,000
-------------
13,808,234
-------------
SHARES VALUE
---------- ---------
INDUSTRIAL - 9.37%
90,000 ACNielson Corp.*....................... $ 2,154,375
16,000 Eaton Corp............................. 1,089,000
25,000 Emerson Electric Co.................... 1,835,938
21,000 Textron, Inc........................... 1,059,188
40,000 Tyco International, Ltd................ 2,267,500
65,000 Waste Management, Inc.................. 1,300,000
-------------
9,706,001
-------------
ENERGY - 7.92%
19,000 Anadarko Petroleum Corp................ 1,216,950
50,000 Baker Hughes, Inc...................... 1,718,750
25,000 Burlington Resources, Inc.............. 900,000
15,000 Kerr-McGee Corp........................ 979,688
37,000 Noble Affiliates, Inc.................. 1,357,438
50,000 Petroleum Geo-Services ASA, ADR*. ..... 684,375
45,000 Sunoco, Inc............................ 1,347,188
-------------
8,204,389
-------------
BASIC MATERIALS - 6.29%
31,000 Eastman Chemical Co.................... 1,329,125
25,000 International Paper Co................. 915,625
60,000 Nucor Corp............................. 2,081,250
95,000 Solutia, Inc........................... 1,211,250
27,000 Willamette Industries, Inc............. 980,437
-------------
6,517,687
-------------
COMMUNICATIONS - 3.57%
50,000 AT&T Corp.............................. 1,159,375
38,000 Lucent Technologies, Inc............... 885,875
52,000 Meredith Corp.......................... 1,651,000
-------------
3,696,250
-------------
UTILITIES - 1.09%
20,000 AES Corp.*............................. 1,130,000
-------------
TOTAL COMMON STOCKS ................... 92,516,164
-------------
(Cost $81,975,410)
SEE NOTES TO FINANCIAL STATEMENTS.
34
<PAGE>
STRATEGIC EQUITY FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2000
PAR VALUE VALUE
---------- ---------
REPURCHASE AGREEMENT - 10.46%
$10,836,000 Repurchase Agreement with:
State Street Bank
6.55%, Due 11/01/2000, dated 10/31/2000
Repurchase Price $10,837,972
(Collateralized by U.S. Treasury Bond
8.88%, Due 02/15/2019;
Total Par $8,260,000,
Market Value $11,057,877).............. $ 10,836,000
-------------
TOTAL REPURCHASE AGREEMENT ............. 10,836,000
-------------
(Cost $10,836,000)
TOTAL INVESTMENTS - 99.74%................................ 103,352,164
-------------
(Cost $92,811,410)
NET OTHER ASSETS AND LIABILITIES - 0.26%.................. 265,102
-------------
NET ASSETS - 100.00%...................................... $ 103,617,266
=============
-------------------------------------------
* Non-income producing security
ADR American Depositary Receipt
SEE NOTES TO FINANCIAL STATEMENTS.
35
<PAGE>
EQUITY VALUE FUND
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 2000
SHARES VALUE
---------- ---------
COMMON STOCKS - 97.50%
TECHNOLOGY - 30.29%
106,400 Altera Corp.*.......................... $ 4,355,750
320,400 Apple Computer, Inc.................... 6,267,825
121,900 Applied Materials, Inc.*............... 6,475,938
70,000 Biogen, Inc.*.......................... 4,213,125
325,200 Citrix Systems, Inc.*.................. 7,195,050
340,621 Compaq Computer Corp................... 10,358,285
202,900 Computer Associates International, Inc. 6,467,438
150,000 Concord EFS, Inc.*..................... 6,196,875
173,400 Cypress Semiconductor Corp.*........... 6,491,663
114,800 EMC Corp.*............................. 10,224,375
200,000 First Data Corp........................ 10,025,000
82,500 International Business Machines Corp. 8,126,250
125,600 Intel Corp............................. 5,652,000
140,000 KLA-Tencorp Corp.*..................... 4,733,750
100,000 Koninklijke (Royal) Philips
Electronics NV, ADR.................... 3,993,750
220,600 Lam Research Corp.*.................... 4,274,125
156,000 Microsoft Corp.*....................... 10,744,500
197,600 Oracle Corp.*.......................... 6,520,800
179,700 Teradyne, Inc.*........................ 5,615,625
-------------
127,932,124
-------------
FINANCE - 18.18%
159,900 Bank of America Corp................... 7,685,194
1,000 Bear Stearns Cos., Inc................. 60,625
144,250 Chase Manhattan Corp................... 6,563,375
86,766 Citigroup, Inc......................... 4,566,061
147,800 Comerica, Inc.......................... 8,914,187
42,200 Fannie Mae............................. 3,249,400
230,400 Firstar Corp........................... 4,536,000
174,400 Household International, Inc........... 8,774,500
81,800 MBIA, Inc.............................. 5,945,837
245,200 MBNA Corp.............................. 9,210,325
109,800 Merrill Lynch & Co., Inc............... 7,686,000
295,700 SouthTrust Corp........................ 9,573,288
-------------
76,764,792
-------------
CONSUMER CYCLICAL - 14.90%
122,500 AMR Corp.*............................. 4,011,875
107,700 Brunswick Corp......................... 2,093,419
370,600 Carnival Corp.......................... 9,195,512
250,000 Circuit City Stores-Circuit City Group 3,312,500
43,500 Delta Air Lines, Inc................... 2,055,375
231,300 Hasbro, Inc............................ 2,486,475
225,500 Intimate Brands, Inc................... 5,383,812
155,400 Jones Apparel Group, Inc.*............. 4,322,062
135,800 Kaufman & Broad Home Corp.............. 4,040,050
200,700 Lowe's Cos., Inc....................... 9,169,481
177,700 Newell Rubbermaid, Inc................. 3,409,619
704,950 Office Depot, Inc.*.................... 5,859,897
67,800 TJX Cos., Inc.......................... 1,847,550
131,700 Whirlpool Corp......................... 5,728,950
-------------
62,916,577
-------------
SHARES VALUE
---------- ---------
ENERGY - 12.54%
29,100 Apache Corp............................ $ 1,609,594
154,500 Baker Hughes, Inc...................... 5,310,937
117,300 Coastal Corp........................... 8,848,819
128,200 Kerr-McGee Corp........................ 8,373,062
159,100 Phillips Petroleum Co.................. 9,824,425
120,000 Sunoco, Inc............................ 3,592,500
52,400 Transocean Sedco Forex, Inc............ 2,777,200
60,800 Tosco Corp............................. 1,740,400
400,000 USX-Marathon Group, Inc................ 10,875,000
-------------
52,951,937
-------------
INDUSTRIAL - 8.20%
225,800 Black & Decker Corp.................... 8,495,725
77,000 FedEx Corp.*........................... 3,608,220
104,300 Illinois Tool Works, Inc............... 5,795,169
177,500 Ingersoll-Rand Co...................... 6,700,625
110,000 Millipore Corp......................... 5,775,000
40,400 Tyco International, Ltd................ 2,290,175
28,100 United Technologies Corp............... 1,961,731
-------------
34,626,645
-------------
CONSUMER STAPLES - 7.76%
80,000 IVAX Corp.*............................ 3,480,000
193,900 Kroger Co.*............................ 4,374,869
37,300 Schering-Plough Corp................... 1,927,944
60,000 VISX, Inc.*............................ 1,286,250
158,100 Watson Pharmaceutical, Inc.*........... 9,891,131
100,900 Wellpoint Health Networks, Inc.*....... 11,798,994
-------------
32,759,188
-------------
COMMUNICATIONS - 2.89%
70,400 Cisco Systems, Inc.*................... 3,792,800
66,600 SBC Communications, Inc................ 3,841,988
78,800 Verizon Communications................. 4,555,625
-------------
12,190,413
-------------
BASIC MATERIALS - 2.74%
265,900 Georgia-Pacific Group.................. 7,146,062
127,800 Nucor Corp............................. 4,433,062
-------------
11,579,124
-------------
TOTAL COMMON STOCKS ................... 411,720,800
-------------
(Cost $357,999,617)
SEE NOTES TO FINANCIAL STATEMENTS.
36
<PAGE>
EQUITY VALUE FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2000
PAR VALUE VALUE
---------- ---------
REPURCHASE AGREEMENT - 0.97%
$ 4,079,000 Repurchase Agreement with:
State Street Bank
6.55%, Due 11/01/2000, dated 10/31/2000
Repurchase Price $4,079,742
(Collateralized by U.S.Treasury Bond
8.75%, Due 05/15/2017;
Total Par $3,130,000
Market Value $4,163,964)............... $ 4,079,000
-------------
TOTAL REPURCHASE AGREEMENT ............ 4,079,000
-------------
(Cost $4,079,000)
TOTAL INVESTMENTS - 98.47%................................ 415,799,800
-------------
(Cost $362,078,617)
NET OTHER ASSETS AND LIABILITIES - 1.53%.................. 6,454,599
-------------
NET ASSETS - 100.00%...................................... $ 422,254,399
=============
------------------------------------------
* Non-income producing security.
ADR American Depositary Receipt
SEE NOTES TO FINANCIAL STATEMENTS.
37
<PAGE>
EQUITY GROWTH FUND
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 2000
SHARES VALUE
---------- ---------
COMMON STOCKS - 96.98%
CONSUMER STAPLES - 19.58%
400,000 American Home Products Corp............ $ 25,400,000
500,000 Anheuser-Busch Cos., Inc............... 22,875,000
400,000 Baxter International, Inc.............. 32,875,000
350,000 Bristol-Myers Squibb Co................ 21,328,125
750,000 Elan Corp. Plc, ADR*................... 38,953,125
260,000 Forest Laboratories, Inc., Class A* ... 34,450,000
250,000 Johnson & Johnson Co................... 23,031,250
425,000 Merck & Co., Inc....................... 38,223,437
450,000 PepsiCo, Inc........................... 21,796,875
756,250 Pfizer, Inc............................ 32,660,547
550,000 Pharmacia Corp......................... 30,250,000
275,500 Procter & Gamble Co.................... 19,681,031
400,000 Schering-Plough Corp................... 20,675,000
600,000 Tenet Healthcare Corp.*................ 23,587,500
--------------
385,786,890
--------------
FINANCE - 15.76%
405,000 American Express Co.................... 24,300,000
487,500 American International Group, Inc. .... 47,775,000
400,000 Bank of America Corp................... 19,225,000
800,000 Chase Manhattan Corp................... 36,400,000
766,666 Citigroup, Inc......................... 40,345,798
350,000 Fannie Mae............................. 26,950,000
250,000 Goldman Sachs Group, Inc............... 24,953,125
173,400 Morgan (J.P.) & Co., Inc............... 28,697,700
91,300 Nasdaq-100 Shares*..................... 7,469,481
250,000 Standard & Poor's Depository Receipts.. 35,765,625
400,000 Wells Fargo & Co....................... 18,525,000
--------------
310,406,729
--------------
INDUSTRIAL - 14.51%
700,000 Flextronics International, Ltd.*....... 26,600,000
1,065,000 General Electric Co.................... 58,375,312
775,000 Honeywell International, Inc........... 41,704,688
345,000 Illinois Tool Works, Inc............... 19,169,063
355,000 Maxim Integrated Products, Inc.*....... 23,540,938
800,000 Solectron Corp.*....................... 35,200,000
1,000,000 Tyco International, Ltd................ 56,687,500
350,000 United Technologies Corp............... 24,434,375
--------------
285,711,876
--------------
COMMUNICATIONS - 14.17%
400,000 America OnLine, Inc.*.................. 20,172,000
576,800 American Tower Corp., Class A*......... 23,612,750
700,000 AT&T Corp., Liberty Media Group*....... 12,600,000
48,000 AT&T Wireless Group*................... 1,197,000
41,666 Avaya, Inc.*........................... 559,887
600,000 Cisco Systems, Inc.*................... 32,325,000
176,000 EchoStar Communications Corp.,
Class A* .............................. 7,964,000
500,000 Infinity Broadcasting Corp., Class A* 16,625,000
SHARES VALUE
---------- ---------
COMMUNICATIONS (CONTINUED)
800,000 Nokia Corp., Class A, ADR.............. $ 34,200,000
450,000 Nortel Networks Corp................... 20,475,000
515,000 Qwest Communications
International, Inc.*................... 25,041,875
400,000 SBC Communications, Inc................ 23,075,000
70,000 SDL, Inc.*............................. 18,147,500
35,000 Tycom, Ltd.*........................... 1,172,500
700,000 WorldCom, Inc.*........................ 16,625,000
750,000 XO Communications, Inc., Class A*...... 25,300,781
--------------
279,093,293
--------------
TECHNOLOGY - 13.69%
500,000 Applied Materials, Inc.*............... 26,562,500
625,000 Automatic Data Processing, Inc. ....... 40,820,313
655,000 Compaq Computer Corp................... 19,918,550
200,000 EMC Corp.*............................. 17,812,500
150,000 Genentech, Inc.*....................... 12,375,000
250,000 International Business Machines Corp... 24,625,000
605,000 Microsoft Corp.*....................... 41,669,375
450,000 Oracle Corp.*.......................... 14,850,000
225,000 Sun Microsystems, Inc.*................ 24,946,875
350,000 Teradyne, Inc.*........................ 10,937,500
715,000 Texas Instruments, Inc................. 35,079,688
--------------
269,597,301
--------------
ENERGY - 10.04%
500,000 Anadarko Petroleum Corp................ 32,025,000
800,000 Baker Hughes, Inc...................... 27,500,000
660,000 BP Amoco Plc, ADR...................... 33,618,750
760,000 Conoco, Inc., Class B.................. 20,662,500
226,000 Cooper Cameron Corp.*.................. 12,317,000
350,000 Schlumberger, Ltd...................... 26,643,750
475,000 Transocean Sedco Forex, Inc............ 25,175,000
475,000 Williams Cos., Inc..................... 19,860,937
--------------
197,802,937
--------------
CONSUMER CYCLICAL - 7.08%
850,000 CVS Corp............................... 44,996,875
463,266 Ford Motor Co.......................... 12,102,824
250,000 Harley-Davidson, Inc................... 12,046,875
751,000 Home Depot, Inc........................ 32,293,000
400,000 RadioShack Corp........................ 23,850,000
1,000,000 Staples, Inc.*......................... 14,250,000
--------------
139,539,574
--------------
UTILITY - 2.15%
750,000 AES Corp.*............................. 42,375,000
--------------
TOTAL COMMON STOCKS ................... 1,910,313,600
--------------
(Cost $1,251,863,607)
SEE NOTES TO FINANCIAL STATEMENTS.
38
<PAGE>
EQUITY GROWTH FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2000
PAR VALUE VALUE
---------- ---------
REPURCHASE AGREEMENT - 3.37%
$66,359,000 Repurchase Agreement with:
State Street Bank 6.55%,
Due 11/01/2000, dated 10/31/2000
Repurchase Price $66,371,074
(Collateralized by U.S. Treasury Bond
8.75%, Due 05/15/2017;
Total Par $50,880,000,
Market Value $67,687,699).............. $ 66,359,000
--------------
TOTAL REPURCHASE AGREEMENT ............ 66,359,000
--------------
(Cost $66,359,000)
TOTAL INVESTMENTS - 100.35%............................... 1,976,672,600
--------------
(Cost $1,318,222,607)
NET OTHER ASSETS AND LIABILITIES - (0.35)%................ (6,917,695)
--------------
NET ASSETS - 100.00%...................................... $1,969,754,905
==============
------------------------------------------
* Non-income producing security.
ADR American Depositary Receipt
SEE NOTES TO FINANCIAL STATEMENTS.
39
<PAGE>
GROWTH FUND II
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 2000
SHARES VALUE
---------- ---------
COMMON STOCKS - 92.25%
CONSUMER CYCLICAL - 30.26%
375,000 Bed, Bath & Beyond, Inc.*.............. $ 9,679,687
75,000 Cheesecake Factory (The), Inc.*........ 3,323,437
225,000 Dollar Tree Stores, Inc.*.............. 8,803,125
95,000 Fastenal Co............................ 5,456,563
1 99 Cents Only Stores*.................. 22
167,700 P.F. Chang's China Bistro, Inc.*....... 6,875,700
325,000 Pizzaexpress Plc (UK).................. 3,114,645
1,906,100 Wetherspoon (J.D.) Plc (UK)............ 8,635,382
-------------
45,888,561
-------------
TECHNOLOGY - 21.98%
110,000 Avocent Corp.*......................... 7,803,125
30,000 Cree, Inc.*............................ 2,977,500
33,000 McData Corp.*.......................... 2,750,859
50,000 MCSi, Inc.*............................ 1,437,500
30,200 Microtune, Inc.*....................... 849,375
140,000 Qlogic Corp.*.......................... 13,545,000
30,000 VeriSign, Inc.*........................ 3,960,000
-------------
33,323,359
-------------
COMMUNICATIONS - 10.78%
40,000 Emulex Corp.*.......................... 5,875,000
200,000 Finisar Corp.*......................... 5,762,500
55,000 SynQuest, Inc.*........................ 910,938
45,700 WebTrends Corp.*....................... 1,468,827
190,000 Zengine, Inc.*......................... 2,327,500
-------------
16,344,765
-------------
ENERGY - 10.11%
50,000 Barrett Resources Corp.*............... 1,818,750
100,000 Denbury Resources, Inc.*............... 687,500
20,000 Noble Drilling Corp.*.................. 831,250
24,645 Prima Energy Corp.*.................... 1,095,162
150,000 Remington Oil & Gas Corp.*............. 1,378,125
150,000 St. Mary Land & Exploration............ 3,515,625
50,000 Spinnaker Exploration Co.*............. 1,512,500
75,000 Stone Energy Corp.*.................... 3,840,000
20,000 Swift Energy Co.*...................... 650,000
-------------
15,328,912
-------------
INDUSTRIAL - 9.28%
75,000 Danaher Corp........................... 4,734,375
75,000 Presstek, Inc.*........................ 1,181,250
100,000 Shaw Group (The), Inc.*................ 8,150,000
-------------
14,065,625
-------------
SHARES VALUE
---------- ---------
CONSUMER STAPLES - 7.14%
76,200 ATS Medical, Inc.*..................... $ 1,395,413
50,000 Ciphergen Biosystems, Inc.*............ 1,550,000
4,250 Eden Bioscience Corp.*................. 160,969
41,250 Endocare, Inc.*........................ 729,609
80,000 Millennium Pharmaceuticals*............ 5,805,000
97,700 Thoratec Laboratories Corp.*........... 1,190,719
-------------
10,831,710
-------------
FINANCE - 2.37%
70,000 Fifth Third Bancorp.................... 3,596,250
-------------
UTILITY - 0.33%
30,000 TNPC, Inc.*............................ 498,750
-------------
TOTAL COMMON STOCKS ................... 139,877,932
-------------
(Cost $85,598,961)
PREFERRED STOCK - 1.98%
394,218 Network Specialists, Series A (A) 2,999,999
-------------
TOTAL PREFERRED STOCK ................. 2,999,999
-------------
(Cost $2,999,999)
PAR VALUE
----------
REPURCHASE AGREEMENT - 5.76%
$ 8,734,000 Repurchase Agreement with:
State Street Bank
6.55%, Due 11/01/2000, dated 10/31/2000
Repurchase Price $8,735,589
(Collateralized by U.S.Treasury Note
7.50%, Due 11/15/2001;
Total Par $8,520,000
Market Value $8,911,963)............... 8,734,000
-------------
TOTAL REPURCHASE AGREEMENT ............ 8,734,000
-------------
(Cost $8,734,000)
TOTAL INVESTMENTS - 99.99%................................ 151,611,931
-------------
(Cost $97,332,960)
NET OTHER ASSETS AND LIABILITIES - 0.01%.................. 9,001
-------------
NET ASSETS - 100.00%...................................... $ 151,620,932
=============
------------------------------------------------
* Non-income producing security.
(A) Security exempt from registration pursuant to Rule 144A under the
Securities Acto of 1933, as amended. This security may only be resold, in
a transaction exempt from registration, to qualified institutional
buyers. At October 31, 2000, this security amounted to $2,999,999, or
1.98% of net assets.
(UK) United Kingdom Equity
SEE NOTES TO FINANCIAL STATEMENTS.
40
<PAGE>
SMALL CAP VALUE FUND
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 2000
SHARES VALUE
---------- ---------
COMMON STOCKS - 88.69%
CONSUMER STAPLES - 18.27%
65,400 American Healthways, Inc.*............. $ 515,025
55,600 ASI Solutions, Inc.*................... 917,400
48,200 ATS Medical, Inc.*..................... 882,662
224,600 Beverly Enterprises, Inc.*............. 1,123,000
221,166 Bindley Western Industries, Inc. ...... 7,948,153
207,900 Children's Comprehensive Services,Inc.* 753,637
174,300 Condor Technology Solutions, Inc.*..... 49,022
96,900 Corn Products International, Inc. ..... 2,434,612
130,200 Datascope Corp......................... 4,508,175
194,300 DaVita, Inc.*.......................... 2,185,875
183,100 Delta & Pine Land Co................... 4,474,506
194,400 Health Management Systems, Inc.*....... 291,600
225,826 ICN Pharmaceuticals, Inc............... 8,595,502
81,100 Ingles Markets, Inc., Class A.......... 800,862
268,800 Invacare Corp.......................... 7,660,800
153,500 ITT Educational Services, Inc.*........ 2,417,625
384,400 kforce.com, Inc.*...................... 1,561,625
184,300 Kroll-O'Gara (The) Co.*................ 1,082,762
119,300 Lifecore Biomedical, Inc.*............. 850,012
145,400 Michael Foods, Inc..................... 3,916,712
139,875 Minntech Corp.......................... 961,641
127,700 MPW Industrial Services Group, Inc.*... 231,456
85,600 Nashua Corp.*.......................... 497,550
420,600 Nextera Enterprises, Inc., Class A* ... 683,475
71,000 Northland Cranberries, Inc., Class A .. 53,250
107,800 Performance Food Group Co.*............ 4,365,900
272,700 PSS World Medical, Inc.*............... 818,100
79,600 RemedyTemp, Inc., Class A*............. 686,550
539,025 Res-Care, Inc.*........................ 2,964,637
215,521 Respironics, Inc.*..................... 4,229,600
98,400 Scios, Inc.*........................... 1,408,350
353,300 SOS Staffing Services, Inc.*........... 750,762
307,200 Spherion Corp.*........................ 3,648,000
134,700 United Natural Foods, Inc.*............ 1,692,169
45,800 Wackenhut Corp., Class A............... 578,225
122,400 Westaff, Inc.*......................... 359,550
114,300 York Group, Inc........................ 550,069
-------------
77,448,851
-------------
INDUSTRIAL - 16.00%
149,000 ABC-NACO, Inc.*........................ 745,000
80,050 Advanced Technical Products, Inc.* .... 420,263
218,800 Airgas, Inc.*.......................... 1,476,900
194,900 AirNet Systems, Inc.*.................. 779,600
134,800 Analogic Corp.......................... 4,760,125
245,200 Benchmark Electronics, Inc.*........... 9,869,300
96,900 Calgon Carbon Corp..................... 569,288
163,400 Capital Environmental Resource, Inc.* . 469,775
127,550 Chicago Bridge & Iron Co. NV........... 2,016,884
78,100 CLARCOR, Inc........................... 1,493,663
16,100 Coherent, Inc.*........................ 560,481
87,400 CTB International Corp.*............... 655,500
220,400 Denison International Plc, ADR*........ 2,906,525
SHARES VALUE
---------- ---------
INDUSTRIAL (CONTINUED)
105,900 Gerber Scientific, Inc................. $ 847,200
73,700 Giga-Tronics, Inc.*.................... 488,263
123,500 Greif Brothers Corp., Class A.......... 3,952,000
25,000 Heartland Express, Inc.*............... 434,375
164,569 Interlogix, Inc.*...................... 2,026,256
191,100 Kaman Corp., Class A................... 2,770,950
80,600 Key Technology, Inc.*.................. 604,500
47,710 K-Tron International, Inc.*............ 864,744
100,100 Ladish Co., Inc.*...................... 1,013,513
104,000 Layne Christensen Co.*................. 455,000
35,242 Lennox International, Inc.............. 279,733
169,800 Longview Fibre Co...................... 2,313,525
224,200 LSI Industries, Inc.................... 4,203,750
112,200 Lydall, Inc.*.......................... 1,185,113
204,400 NCI Building Systems, Inc.*............ 3,180,975
24,214 Northrop Grumman Corp.................. 2,033,976
186,100 Northwest Pipe Co.*.................... 1,954,050
96,900 Offshore Logistics, Inc.*.............. 1,671,525
32,000 Pentair, Inc........................... 954,000
88,100 Rayovac Corp.*......................... 1,299,475
80,700 Smith (A.O.) Corp...................... 1,139,888
188,844 Terex Corp.*........................... 2,325,142
87,400 TransTechnology Corp................... 344,138
164,100 Valmont Industries, Inc................ 3,343,538
74,700 Willis Lease Finance Corp.*............ 429,525
101,000 Wood's (T.B.) Corp..................... 883,750
-------------
67,722,208
-------------
CONSUMER CYCLICAL - 13.74%
89,200 America West Holdings Corp., Class B*.. 886,425
194,100 American Homestar Corp.*............... 133,444
96,900 Anicom, Inc.*.......................... 372,459
162,200 Applebee's International, Inc. ........ 4,898,947
92,600 Atlantic Coast Airlines Holdings, Inc.* 3,310,450
71,650 Bassett Furniture Industries, Inc. .... 904,581
61,300 Beazer Homes USA, Inc.*................ 1,708,737
139,900 CEC Entertainment, Inc.*............... 4,459,312
86,700 Culp, Inc.............................. 341,381
68,100 Ethan Allen Interiors, Inc............. 1,991,925
169,300 Friendly Ice Cream Corp.*.............. 359,762
99,800 G & K Services, Inc., Class A.......... 2,756,975
138,100 Goody's Family Clothing, Inc.*......... 496,297
166,250 InterTAN, Inc.*........................ 1,839,141
141,900 K2, Inc.*.............................. 1,348,050
156,000 Midwest Express Holdings, Inc.*........ 2,964,000
202,716 Morrison Management Specialists, Inc. . 6,790,986
97,100 Musicland Stores Corp.*................ 788,937
46,500 Newmark Homes Corp.*................... 395,250
225,205 O'Charley's, Inc.*..................... 3,293,623
94,400 Oshkosh Truck Corp..................... 3,882,200
164,900 R & B, Inc.*........................... 340,106
83,600 Rocky Shoes & Boots, Inc.*............. 428,450
106,200 Ruby Tuesday, Inc...................... 1,440,337
158,500 Ryan's Family Steak Houses, Inc.* ..... 1,327,437
64,600 Springs Industries, Inc................ 1,522,137
SEE NOTES TO FINANCIAL STATEMENTS.
41
<PAGE>
SMALL CAP VALUE FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2000
SHARES VALUE
---------- ---------
CONSUMER CYCLICAL (CONTINUED)
53,000 Toll Brothers, Inc.*................... $ 1,722,500
102,600 Toro Co................................ 3,591,000
296,600 Unifirst Corp.......................... 2,836,237
117,300 WestPoint Stevens, Inc................. 843,094
9,900 Wet Seal, Inc., Class A*............... 185,625
-------------
58,159,805
-------------
FINANCE - 13.09%
36,000 AmeriCredit Corp.*..................... 967,500
129,220 AmerUs Group Co........................ 3,408,178
85,600 Annuity & Life Re (Holdings), Ltd. 2,359,350
77,900 Brandywine Realty Trust, REIT.......... 1,489,837
99,500 Brown & Brown, Inc..................... 3,233,750
64,600 Connecticut Bancshares, Inc.*.......... 1,170,875
127,900 Corporate Office Properties Trust, Inc.,
REIT .................................. 1,247,025
43,900 Equity One, Inc., REIT................. 411,562
70,000 Great American Financial Resources, Inc. 1,242,500
41,691 Hanmi Financial Corp.*................. 604,519
277,825 Healthcare Financial Partners, Inc.,
REIT (A)*.............................. 5,556,500
111,130 Healthcare Financial Partners, Inc.,
WTS (A)* .............................. 0
65,650 Healthcare Realty Trust, Inc., REIT.... 1,308,897
118,183 Heller Financial, Inc.................. 3,456,853
166,200 Horace Mann Educators Corp............. 2,794,238
107,500 Innkeepers USA Trust, Inc., REIT....... 1,095,156
24,400 Kansas City Life Insurance Co.......... 791,475
48,000 Kilroy Realty Corp., REIT.............. 1,251,000
187,400 Matrix Bancorp, Inc.*.................. 1,335,225
56,100 National Golf Properties, Inc., REIT... 1,114,988
147,200 North Fork Bancorporation, Inc......... 2,971,600
60,000 Ohio Casualty Corp..................... 504,375
18,300 PICO Holdings, Inc.*................... 235,613
36,300 Prime Group Realty Trust, REIT......... 539,963
438,240 Republic Bancorp, Inc.................. 4,163,280
97,500 Seacoast Financial Services Corp. ..... 1,035,938
161,100 Selective Insurance Group, Inc. ....... 2,778,975
58,700 SL Green Realty Corp., REIT............ 1,573,894
157,900 Superior Financial Corp.*.............. 1,736,900
89,100 Texas Regional Bancshares, Inc., Class A 2,661,863
96,700 Webster Financial Corp................. 2,357,063
-------------
55,398,892
-------------
ENERGY - 11.77%
64,200 3TEC Energy Corp.*..................... 946,950
64,300 Atwood Oceanics, Inc.*................. 2,158,069
108,700 Bellwether Exploration Co.*............ 794,869
141,200 Callon Petroleum Co.*.................. 2,153,300
94,500 Core Laboratories NV*.................. 2,037,656
SHARES VALUE
---------- ---------
ENERGY (CONTINUED)
244,500 Cross Timbers Oil Co................... $ 4,599,656
111,100 Evergreen Resources, Inc.*............. 3,055,250
144,900 Gulfmark Offshore, Inc.*............... 4,111,537
169,700 Houston Exploration (The) Co.*......... 3,818,250
134,700 Key Production Co., Inc.*.............. 2,963,400
177,400 Louis Dreyfus Natural Gas Corp.*....... 5,687,887
117,600 Marine Drilling Cos., Inc.*............ 2,807,700
171,020 Meridian Resource Corp.*............... 1,186,451
168,700 Midcoast Energy Resources, Inc......... 3,416,175
40,000 Nuevo Energy Co.*...................... 725,000
90,800 Oceaneering International, Inc.*....... 1,276,875
82,300 Pennaco Energy, Inc.*.................. 1,023,606
53,700 Pride International, Inc.*............. 1,359,281
115,000 Triton Energy, Ltd.*................... 3,536,250
102,000 Vintage Petroleum, Inc................. 2,154,750
-------------
49,812,912
-------------
TECHNOLOGY - 5.26%
113,100 Acxiom Corp.*.......................... 4,552,275
127,200 Analysts International Corp............ 795,000
203,100 Bell & Howell Co.*..................... 3,858,900
355,200 Computer Task Group, Inc............... 1,864,800
227,300 Infinium Software, Inc.*............... 681,900
182,800 infoUSA, Inc.*......................... 594,100
82,200 Integral Systems, Inc.*................ 1,397,400
108,200 Landmark Systems Corp.*................ 432,800
40,600 Mentor Graphics Corp.*................. 951,563
187,500 Metro Information Services, Inc.*...... 1,171,875
149,200 MSC.Software Corp.*.................... 1,220,456
116,650 Peak International, Ltd.*.............. 896,747
123,900 Progress Software Corp.*............... 1,959,169
48,600 S3, Inc.*.............................. 438,919
58,100 Sybase, Inc.*.......................... 1,216,469
80,700 3DO (The) Co.*......................... 247,144
-------------
22,279,517
-------------
COMMUNICATIONS - 4.94%
96,850 ADVO, Inc.*............................ 3,565,291
149,000 CT Communications, Inc................. 2,989,313
108,900 General Communication, Inc., Class A*.. 850,781
136,100 Houghton Mifflin Co.................... 5,010,181
193,400 Hypercom Corp.*........................ 1,329,625
64,600 Motient Corp.*......................... 783,275
167,300 Performance Technologies, Inc.*........ 2,791,819
66,600 Telemate.Net Software, Inc.*........... 95,738
171,200 World Access, Inc.*.................... 834,600
107,400 Young Broadcasting, Inc., Class A*.... 2,664,862
-------------
20,915,485
-------------
SEE NOTES TO FINANCIAL STATEMENTS.
42
<PAGE>
SMALL CAP VALUE FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2000
SHARES VALUE
---------- ---------
UTILITIES - 4.60%
9,500 American States Water Co............... $ 296,281
103,250 Atmos Energy Corp...................... 2,387,656
99,650 Cascade Natural Gas Corp............... 1,837,297
121,200 Conectiv, Inc.......................... 2,174,025
32,300 Kansas City Power & Light Co........... 777,219
20,000 Middlesex Water Co., Inc............... 545,000
60,500 New Jersey Resources Corp.............. 2,416,219
48,100 Niagara Mohawk Holdings, Inc. ......... 769,600
43,500 NUI Corp............................... 1,356,656
68,000 Philadelphia Suburban Corp............. 1,593,750
50,500 South Jersey Industries, Inc. ......... 1,470,813
184,200 Southwest Gas Corp..................... 3,845,175
-------------
19,469,691
-------------
BASIC MATERIALS - 1.02%
57,000 Buckeye Technologies, Inc.*............ 976,125
54,900 Lindberg Corp.......................... 411,750
123,300 Reliance Steel & Aluminum Co........... 2,928,375
-------------
4,316,250
-------------
TOTAL COMMON STOCKS ................... 375,523,611
-------------
(Cost $385,189,684)
PAR VALUE VALUE
---------- ---------
CORPORATE BOND - 0.08%
$ 369,900 MSC.Software Corp. Convertible
Subordinated Debenture
7.88%, 08/18/04 ..................... $ 325,512
-------------
TOTAL CORPORATE BOND .................. 325,512
-------------
(Cost $369,900)
REPURCHASE AGREEMENT - 11.72%
49,600,000 Repurchase Agreement with:
State Street Bank
6.55%, Due 11/01/2000, dated 10/31/2000
Repurchase Price $49,609,024
(Collateralized by U.S. Treasury Bond
8.88%, Due 02/15/2019;
Total Par $37,795,000
Market Value $50,597,149).............. 49,600,000
-------------
TOTAL REPURCHASE AGREEMENT ............ 49,600,000
-------------
(Cost $49,600,000)
TOTAL INVESTMENTS - 100.49%............................... 425,449,123
-------------
(Cost $435,159,584)
NET OTHER ASSETS AND LIABILITIES - (0.49)%................ (2,092,858)
-------------
NET ASSETS - 100.00%...................................... $ 423,356,265
=============
----------------------------------------------
* Non-income producing security.
(A) Securities exempt from registration pursuant to Rule 144A under the
Securities Act of 1933, as amended. These securities may only be resold,
in transactions exempt from registration, to qualified institutional
buyers. At October 31, 2000, these securities amounted to $5,556,500 or
1.31% of net assets.
ADR American Depositary Receipt
REIT Real Estate Investment Trust
WTS Warrants
SEE NOTES TO FINANCIAL STATEMENTS.
43
<PAGE>
SMALL COMPANY EQUITY FUND
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 2000
SHARES VALUE
---------- ---------
COMMON STOCKS - 92.86%
CONSUMER STAPLES - 19.23%
79,330 Accredo Health, Inc.*.................. $ 3,431,022
61,400 ArthroCare Corp.*...................... 1,393,012
122,700 Atrix Laboratories, Inc.*.............. 2,177,925
294,900 ATS Medical, Inc.*..................... 5,400,356
141,020 Bright Horizon Family Solutions, Inc.* 3,525,500
148,670 Charles River Associates, Inc.*........ 1,653,954
23,200 Ciphergen Biosystems, Inc.*............ 719,200
35,100 Closure Medical Corp.*................. 851,175
47,570 CV Therapeutics, Inc.*................. 3,746,137
91,900 Dreyer's Grand Ice Cream, Inc. ........ 2,263,037
149,010 Education Management, Inc.*............ 4,619,310
153,300 ESC Medical Systems, Ltd.*............. 2,385,731
54,000 Euronet Services, Inc. ................ 405,000
26,000 First Horizon Pharmaceutical Corp.* ... 542,750
127,160 FirstService Corp.*.................... 1,772,292
117,800 Forrester Research, Inc.*.............. 4,837,162
95,310 Fusion Medical Technologies, Inc.* .... 786,307
501,170 Hooper Holmes, Inc..................... 4,756,103
249,650 ICT Group, Inc.*....................... 2,683,738
250,594 kforce.com, Inc.*...................... 1,018,038
164,600 Kroll-O'Gara (The) Co.*................ 967,025
153,300 Lifecore Biomedical, Inc.*............. 1,092,263
96,970 LifePoint Hospitals, Inc.*............. 3,757,588
96,750 Luminex Corp.*......................... 2,624,344
111,040 Management Network Group, Inc.*........ 1,464,340
36,200 Med-Design Corp.*...................... 651,600
198,100 Meta Group, Inc.*...................... 1,906,713
109,534 On Assignment, Inc.*................... 2,758,888
179,520 Orthodontic Centers of America, Inc.*.. 5,991,480
172,730 Osteotech, Inc.*....................... 950,015
153,100 Pennzoil-Quaker State Co.*............. 1,798,925
92,100 PhotoMedex, Inc.*...................... 1,197,300
93,280 Pre-Paid Legal Services, Inc.*......... 4,092,660
357,080 ProsoftTraining.com*................... 2,499,560
81,210 Province Healthcare Co.*............... 3,420,971
97,700 Regeneration Technologies, Inc.*....... 1,239,569
122,500 Rent-A-Center, Inc.*................... 3,575,469
301,930 Source Information Management Co.* .... 1,660,615
85,700 TeleTech Holdings, Inc.*............... 2,378,175
272,380 Thoratec Laboratories Corp.*........... 3,319,631
122,600 Triad Hospitals, Inc.*................. 3,402,150
352,370 Trico Marine Services, Inc.*........... 5,858,151
245,700 U.S. Oncology, Inc.*................... 1,320,638
43,920 Varian Medical Systems, Inc.*.......... 2,146,590
-------------
109,042,409
-------------
CONSUMER CYCLICAL - 18.94%
224,450 American Classic Voyages Co.*.......... 3,100,216
106,960 Applebee's International, Inc. ........ 3,230,526
91,900 Atlantic Coast Airlines Holdings, Inc.* 3,285,425
206,480 Bally Total Fitness Holding Corp.* .... 5,149,095
313,880 Bombay Co. (The), Inc.*................ 784,700
65,130 Borg-Warner, Inc....................... 2,458,657
SHARES VALUE
---------- ---------
CONSUMER CYCLICAL (CONTINUED)
313,210 Brass Eagle, Inc.*..................... $ 1,174,537
30,300 California Pizza Kitchen, Inc.*........ 1,060,500
254,950 Callaway Golf Co....................... 4,079,200
183,200 Casey's General Stores, Inc............ 2,290,000
354,370 Cash America International, Inc. ...... 1,838,294
174,520 CEC Entertainment, Inc.*............... 5,562,825
130,370 Cooper Tire & Rubber Co................ 1,425,922
100,105 Cost Plus, Inc.*....................... 2,802,940
200,253 D.R.Horton, Inc........................ 3,704,680
70,340 Damark International, Inc., Class A* 896,835
15,600 Duane Reade, Inc.*..................... 455,325
255,960 Dura Automotive Systems, Inc.*......... 2,159,662
132,400 Frontier Airlines, Inc.*............... 3,111,400
76,560 International Game Technology*......... 2,804,010
254,960 InterTAN, Inc.*........................ 2,820,495
92,100 Jack in the Box, Inc.*................. 2,256,450
149,980 Midwest Express Holdings, Inc.*........ 2,849,620
125,100 Mobile Mini, Inc.*..................... 2,494,181
169,820 Nu Skin Enterprises, Inc., Class A* 923,396
12,300 O'Charley's, Inc.*..................... 179,887
33,800 P.F. Chang's China Bistro, Inc.*....... 1,385,800
286,690 Pier 1 Imports, Inc.................... 3,798,642
116,390 Pinnacle Entertainment, Inc.*.......... 2,655,147
80,770 Polaris Industries, Inc................ 2,806,757
323,520 Prime Hospitality Corp.*............... 3,073,440
97,695 Rare Hospitality International, Inc.*.. 2,271,409
153,500 Ruby Tuesday, Inc...................... 2,081,844
76,700 SkyWest, Inc........................... 3,873,350
101,740 Sonic Corp.*........................... 3,713,510
122,700 Toll Brothers, Inc.*................... 3,987,750
323,860 Tower Automotive, Inc.*................ 3,562,460
134,580 Travis Boats & Motors, Inc.*........... 433,179
122,600 United Stationers, Inc.*............... 3,685,662
127,480 Vans, Inc.*............................ 1,649,272
200,270 Watsco, Inc............................ 1,886,543
107,300 Zale Corp.*............................ 3,634,787
-------------
107,398,330
-------------
INDUSTRIAL - 14.29%
122,600 Armor Holdings, Inc.*.................. 1,907,963
49,730 Artesyn Technologies, Inc.*............ 2,020,281
152,330 Atlas Air, Inc.*....................... 5,521,963
116,940 Axsys Technologies*.................... 5,320,770
64,790 Belden, Inc............................ 1,680,491
81,750 Brooks Automation, Inc.*............... 2,166,375
259,370 Casella Waste Systems, Inc., Class A*.. 2,253,277
127,480 Cidco*................................. 334,635
65,130 Cognex Corp.*.......................... 2,181,855
132,775 CUNO, Inc.*............................ 3,369,166
59,100 DAL-Tile International, Inc.*.......... 731,362
46,000 DDI Corp.*............................. 1,837,125
65,460 Dycom Industries, Inc.*................ 2,462,933
91,900 EGL, Inc.*............................. 2,619,150
174,050 Gentex Corp.*.......................... 4,307,738
96,860 Helix Technology Corp.................. 2,699,973
SEE NOTES TO FINANCIAL STATEMENTS.
44
<PAGE>
SMALL COMPANY EQUITY FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2000
SHARES VALUE
---------- ---------
INDUSTRIAL (CONTINUED)
221,120 Hexcel Corp.*.......................... $ 2,418,500
92,730 Kent Electronics Corp.*................ 1,727,096
123,250 Koala Corp.*........................... 1,232,500
129,260 Maverick Tube Corp.*................... 2,011,609
92,750 Methode Electronics, Inc., Class A..... 3,489,719
122,700 Nam Tai Electronics, Inc............... 2,407,988
41,190 Nanometrics, Inc.*..................... 947,370
288,520 NS Group, Inc.*........................ 2,466,846
315,220 PCD, Inc.*............................. 2,955,188
80,500 Photon Dynamics, Inc.*................. 2,898,000
161,990 Presstek, Inc.*........................ 2,551,343
126,040 TetraTech, Inc.*....................... 4,379,890
92,100 Titan Corp.*........................... 1,231,838
129,130 TRC Cos., Inc.......................... 2,364,693
98,210 Veeco Instruments, Inc.*............... 6,501,809
-------------
80,999,446
-------------
TECHNOLOGY - 12.48%
92,100 ADE Corp.*............................. 1,646,288
122,600 Anadigics, Inc......................... 2,743,175
143,440 Asyst Technologies, Inc.*.............. 2,151,600
35,730 AXT, Inc.*............................. 1,375,605
24,935 Documentum, Inc.*...................... 2,119,475
46,820 DuPont Photomasks, Inc.*............... 2,627,773
29,800 Elantec Semiconductor, Inc.*........... 3,315,250
40,380 EMCORE Corp.*.......................... 1,655,580
110,300 eRoomSystem Technologies, Inc.*........ 454,988
122,900 eXcelon Corp........................... 998,563
81,330 FactSet Research Systems, Inc. ........ 3,079,967
61,000 Fair, Isaac & Co., Inc................. 2,501,000
134,300 Fargo Electronics...................... 369,325
157,970 Galileo Technology, Ltd.*.............. 4,284,936
219,770 HEICO Corp., Class A................... 2,417,470
72,030 Hyperion Solutions Corp.*.............. 1,008,420
179,080 Kopin Corp.*........................... 2,529,505
95,420 LTX Corp.*............................. 1,335,880
325,610 Mercator Software, Inc.*............... 1,485,596
125,930 National Instruments Corp.*............ 5,879,357
151,220 NETsilicon, Inc.*...................... 2,145,434
202,040 Per-Se Technologies, Inc.*............. 890,239
146,240 Photronics, Inc.*...................... 3,299,540
288,520 Pioneer Standard Electronics, Inc. .... 4,003,215
130,370 PLATO Learning, Inc.*.................. 3,194,065
147,930 SeaChange International, Inc.*......... 3,254,460
149,900 Showcase Corp.*........................ 749,500
79,045 SPSS, Inc.*............................ 1,778,513
74,900 TranSwitch Corp.*...................... 4,325,475
284,310 United Shipping & Technology, Inc.* ... 995,085
61,800 Varian Semiconductor Equipment*........ 1,421,400
204,200 Zamba Corp.*........................... 727,462
-------------
70,764,141
-------------
SHARES VALUE
---------- ---------
COMMUNICATIONS - 10.91%
29,575 Aeroflex, Inc.*........................ $ 1,759,712
46,380 AirGate Pcs, Inc.*..................... 1,803,022
28,180 Arguss Communications, Inc.*........... 352,250
91,700 Computer Network Technology Corp.*..... 2,786,820
245,400 General Communication, Inc., Class A*.. 1,917,187
160,630 International Fibercom, Inc.*.......... 2,068,111
160,670 Internet Pictures Corp.*............... 343,934
72,870 Intranet Solutions, Inc.*.............. 3,388,455
173,580 Lightbridge, Inc.*..................... 1,855,136
61,400 LightPath Technologies, Inc., Class A*. 1,673,150
92,100 Metawave Communications Corp.*......... 1,220,325
99,045 Netegrity, Inc.*....................... 7,725,510
192,610 Pegasus Solutions, Inc.*............... 3,286,408
28,510 Powertel, Inc.*........................ 2,487,497
64,580 Proxim, Inc.*.......................... 3,915,162
50,060 RSA Security, Inc.*.................... 2,903,480
191,170 Secure Computing Corp.*................ 4,396,910
124,040 Spectralink Corp.*..................... 922,547
128,260 Tekelec, Inc.*......................... 4,721,571
50,820 Terayon Communication Systems, Inc.*... 1,137,097
63,240 Tollgrade Communcations, Inc.*......... 6,055,230
130,400 Vyyo, Inc.*............................ 2,885,100
114,000 WinStar Communications, Inc.*.......... 2,223,000
-------------
61,827,614
-------------
ENERGY - 8.85%
197,160 3TEC Energy Corp.*..................... 2,908,110
55,700 Berkley Petroleum Corp.*............... 291,757
157,220 Cabot Oil & Gas Corp., Class A......... 3,085,443
258,070 Callon Petroleum Co.*.................. 3,935,568
197,220 Cross Timbers Oil Co................... 3,710,201
67,720 Evergreen Resources, Inc.*............. 1,862,300
96,970 Global Industries, Ltd.*............... 1,018,185
245,700 Grey Wolf, Inc.*....................... 1,136,363
122,200 Input/Output, Inc.*.................... 1,031,063
279,150 Key Energy Services, Inc.*............. 2,512,350
149,167 Magin Energy, Inc.*.................... 253,935
61,300 Marine Drilling Cos., Inc.*............ 1,463,538
56,170 Newfield Exploration Co.*.............. 2,120,418
106,530 Newpark Resources, Inc.*............... 958,770
55,700 Paramount Resources, Ltd............... 574,396
156,140 Pioneer Natural Resources Co.*......... 2,039,579
153,400 Prize Energy Corp...................... 2,569,450
685,716 PYR Energy Corp.*...................... 4,114,296
156,340 Remington Oil & Gas Corp.*............. 1,436,374
120,620 St. Mary Land & Exploration Co......... 2,827,031
160,280 Swift Energy Co.*...................... 5,209,100
61,300 Universal Compression Holdings, Inc.*.. 1,770,038
157,120 Vintage Petroleum, Inc................. 3,319,160
-------------
50,147,425
-------------
SEE NOTES TO FINANCIAL STATEMENTS.
45
<PAGE>
SMALL COMPANY EQUITY FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2000
SHARES VALUE
---------- ---------
FINANCE - 6.89%
160,100 Annuity & Life Re (Holdings), Ltd. .... $ 4,412,756
38,060 Commerce Bancorp, Inc.................. 2,305,009
112,800 Fidelity National Financial, Inc. ..... 2,770,650
61,300 Flushing Financial Corp................ 934,825
237,710 Hibernia Corp., Class A................ 2,837,663
61,300 Hudson United Bancorp.................. 1,371,588
171,140 MFC Bancorp, Ltd.*..................... 1,369,120
192,480 Mutual Risk Management, Ltd............ 3,488,700
61,300 Richmond County Financial Corp......... 1,440,550
334,120 Riggs National Corp.................... 3,758,850
178,410 Southwest Bancorp of Texas, Inc.*...... 6,511,965
122,700 Sterling Bancshares, Inc............... 2,108,906
160,100 Westamerica Bancorp.................... 5,753,594
-------------
39,064,176
-------------
BASIC MATERIALS - 1.27%
192,160 RTI International Metals, Inc.*........ 2,786,320
31,100 Scotts Co., Class A*................... 1,111,825
448,680 Titanium Metals Corp.*................. 3,309,015
-------------
7,207,160
-------------
TOTAL COMMON STOCKS ................... 526,450,701
-------------
(Cost $478,752,587)
PAR VALUE VALUE
---------- ---------
REPURCHASE AGREEMENT - 6.43%
$36,455,000 Repurchase Agreement with:
State Street Bank
6.55%, Due 11/01/2000, dated 10/31/2000,
Repurchase Price $36,461,633
(Collateralized by U.S. Treasury Note
4.75%, Due 11/15/2008;
Total Par $38,940,000
Market Value $37,187,700).............. $ 36,455,000
-------------
TOTAL REPURCHASE AGREEMENT ............ 36,455,000
-------------
(Cost $36,455,000)
TOTAL INVESTMENTS - 99.29%................................ 562,905,701
-------------
(Cost $515,207,587)
NET OTHER ASSETS AND LIABILITIES - 0.71%.................. 4,036,572
-------------
NET ASSETS - 100.00%...................................... $ 566,942,273
=============
----------------------------------------
* Non-income producing security.
SEE NOTES TO FINANCIAL STATEMENTS.
46
<PAGE>
INTERNATIONAL EQUITY FUND
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 2000
SHARES VALUE
---------- ---------
COMMON STOCKS - 94.30%
BRAZIL - 0.50%
333,406 Embratel Participacoes SA, ADR......... $ 5,397,010
--------------
CANADA - 1.81%
427,129 Nortel Networks Corp................... 19,324,700
--------------
FRANCE - 13.45%
274,704 Alcatel SA............................. 16,741,129
155,738 Aventis SA............................. 11,061,894
373,701 Aventis SA, Series A*.................. 26,923,658
171,300 Carrefour Super Marche SA.............. 11,484,834
249,913 Rhodia SA.............................. 3,122,317
124,867 Suez Lyonnaise Des Eaux................ 19,029,538
148,485 Total Fina Elf SA...................... 21,219,299
286,365 Valeo SA............................... 12,451,686
299,649 Vivendi SA............................. 21,512,313
--------------
143,546,668
--------------
GERMANY - 6.39%
58,786 Allianz AG............................. 19,955,715
337,598 Dresdner Bank AG....................... 14,006,945
309,365 E.ON AG................................ 15,706,842
148,810 Metallgesellschaft AG.................. 1,596,823
83,936 SAP AG, Preferred Stock................ 16,967,878
--------------
68,234,203
--------------
HONG KONG - 5.20%
2,283,500 China Mobile, Ltd.*.................... 14,712,707
7,658,000 China Unicom, Ltd.*.................... 15,366,863
792,200 Hutchison Whampoa...................... 9,827,461
1,106,000 MRT Corp., Ltd.*....................... 1,637,920
1,685,000 Sun Hung Kai Properties, Ltd........... 13,935,262
--------------
55,480,213
--------------
ITALY - 6.64%
5,299,941 Banca Nazionale Del Lavoro SpA*........ 17,295,082
2,985,233 ENI SpA................................ 16,067,297
1,532,523 Mediaset SpA........................... 22,316,240
1,772,960 Telecom Italia Mobile SpA.............. 15,192,910
--------------
70,871,529
--------------
JAPAN - 19.86%
475,000 Bridgestone Corp....................... 4,706,933
567,000 Fujitsu, Ltd........................... 10,094,771
277,000 KAO Corp............................... 8,295,540
92,100 Matsushita Communication Industrial Co. 12,061,819
2,539 Mizuho Holdings, Inc................... 19,509,305
SHARES VALUE
---------- ---------
JAPAN (CONTINUED)
117,000 Murata Manufacturing Co., Ltd.......... $ 13,994,139
2,330 Nippon Telegraph & Telephone Corp. .... 21,189,578
1,008,000 Nissan Motor Co., Ltd.*................ 6,914,479
408,000 Nomura Securities Co., Ltd............. 8,650,243
704 NTT Mobile Communication Network....... 17,343,713
435,000 Pioneer Corp........................... 13,465,519
70,100 Rohm Co., Ltd.......................... 17,661,425
2,698,000 Sakura Bank, Ltd....................... 19,643,832
25,368 Shohkoh Fund & Co., Ltd................ 2,081,668
80,000 Taisho Pharmaceuticals Co.............. 2,300,577
243,000 Takeda Chemical Industries............. 16,001,191
44,100 Takefuji Corp.......................... 4,361,938
303,000 Yamanouchi Pharmaceutical Co., Ltd. ... 13,708,398
--------------
211,985,068
--------------
KOREA - 1.38%
195,707 Korea Telecom, ADR..................... 7,216,696
301,248 SK Telecom, Ltd., ADR.................. 7,550,028
--------------
14,766,724
--------------
MEXICO - 0.86%
170,640 Telefonos de Mexico SA, ADR............ 9,203,895
--------------
NETHERLANDS - 12.05%
184,120 Gucci Group NV, ADR.................... 17,997,730
224,481 ING Groep NV*.......................... 15,396,653
999,859 Koninklijke (Royal) KPN NV............. 20,229,356
649,579 Koninklijke Ahold NV................... 18,846,458
87,236 KPNQwest NV*........................... 2,111,022
381,787 Unilever NV............................ 19,124,914
514,976 VNU NV*................................ 24,225,394
477,183 Wolters Kluwer NV...................... 10,726,286
--------------
128,657,813
--------------
SINGAPORE - 1.18%
1,063,525 DBS Group Holdings, Ltd................ 12,540,568
--------------
SPAIN - 1.59%
889,120 Telefonica SA*......................... 16,933,796
--------------
SWEDEN - 2.23%
1,437,436 Ericsson (LM) Telephone Co., Class B... 19,079,739
403,478 Skandinaviska Enskilda Banken, Class A. 4,751,537
--------------
23,831,276
--------------
SWITZERLAND - 1.54%
10,860 Novartis AG, Registered................ 16,470,285
--------------
SEE NOTES TO FINANCIAL STATEMENTS.
47
<PAGE>
INTERNATIONAL EQUITY FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2000
SHARES VALUE
---------- ---------
TURKEY - 0.26%
252,650 Turkcell Iletisim Hizmet AS, ADR* ..... $ 2,763,359
--------------
UNITED KINGDOM - 19.36%
305,685 AstraZeneca Plc........................ 14,328,110
3,652,618 British Aerospace Plc.................. 20,764,300
1,110,165 Cable & Wireless Plc................... 15,717,136
453,643 COLT Telecom Group Plc*................ 14,491,661
2,422,123 Diageo Plc............................. 22,878,353
797,778 Glaxo Wellcome Plc..................... 22,982,909
1,356,621 HSBC Holdings Plc...................... 19,344,223
1 Powergen Plc........................... 8
460,085 Railtrack Group Plc.................... 7,121,583
2,700,167 Reed International Plc................. 24,975,335
1,322,829 Somerfield Plc......................... 1,469,422
1,094,319 TeleWest Communications Plc*........... 1,811,465
9,797,457 Vodafone Group Plc..................... 40,794,166
--------------
206,678,671
--------------
TOTAL COMMON STOCKS ................... 1,006,685,778
--------------
(Cost $986,498,815)
PAR VALUE VALUE
---------- ---------
REPURCHASE AGREEMENT - 3.27%
$34,872,000 Repurchase Agreement with:
State Street Bank 6.55%,
Due 11/01/2000, dated 10/31/2000
Repurchase Price $34,878,345
(Collateralized by U.S. Treasury Bond
8.50%, Due 02/15/2020;
Total Par $27,265,000,
Market Value $35,575,836).............. $ 34,872,000
--------------
TOTAL REPURCHASE AGREEMENT ............ 34,872,000
--------------
(Cost $34,872,000)
TOTAL INVESTMENTS - 97.57%................................ 1,041,557,778
--------------
(Cost $1,021,370,815)
NET OTHER ASSETS AND LIABILITIES - 2.43%.................. 25,949,015
--------------
NET ASSETS - 100.00%...................................... $1,067,506,793
==============
-----------------------------------------
* Non-income producing security.
ADR American Depositary Receipt
FORWARD FOREIGN CURRENCY CONTRACTS PURCHASED:
CURRENCY CONTRACT TO SETTLEMENT CONTRACT UNREALIZED
VALUE DELIVER DATES AT VALUE (DEPRECIATION)
--------- ----------- ---------- ---------- --------------
24,814,004 JPY 11/01/00 $ 227,255 $ (983)
651,014,000 JPY 11/10/00 5,971,662 (60,155)
---------- -----------
$6,198,917 (61,138)
---------- -----------
FORWARD FOREIGN CURRENCY CONTRACTS SOLD:
UNREALIZED
CURRENCY CONTRACT TO SETTLEMENT CONTRACT APPRECIATION
VALUE DELIVER DATES AT VALUE (DEPRECIATION)
--------- ----------- ---------- ----------- --------------
17,177,763 EMU 11/01/00 $14,559,869 $ (116,462)
194,179 EMU 11/03/00 164,595 228
----------- -----------
$14,724,464 (116,234)
----------- -----------
TOTAL $ (177,372)
-----------
-------------------------------------
EMU European Monetary Unit
JPY Japanese Yen
--------------------------------------------------------------------------------
INDUSTRY CONCENTRATION OF COMMON STOCKS
AS A PERCENTAGE OF NET ASSETS:
Communications 27.98%
Consumer Staples 23.13
Finance 15.81
Technology 6.76
Utilities 6.26
Industrial 4.08
Consumer Cyclical 3.50
Energy 3.49
Basic Material 2.22
Diversified 1.07
-------
94.30%
=======
SEE NOTES TO FINANCIAL STATEMENTS.
48
<PAGE>
PAN ASIA FUND
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 2000
SHARES VALUE
---------- ---------
COMMON STOCKS - 81.45%
HONG KONG - 19.72%
10,000 Amoy Properties, Ltd................... $ 9,104
20,000 Cathay Pacific Airways................. 36,287
8,000 Cheung Kong Holdings, Ltd.............. 88,475
15,000 China Mobile, Ltd.*.................... 96,649
9,000 China Petroleum and Chemical Corp.
(Sinopec)* ............................ 1,766
100,000 China Southern Airlines Co., Ltd.*..... 24,491
30,000 China Unicom, Ltd.*.................... 60,201
30,000 Cosco Pacific, Ltd..................... 22,503
20,000 Dah Sing Financial Group............... 85,910
30,000 Hong Kong Exchanges & Clearing, Ltd.... 52,316
4,000 HSBC Holdings, Plc..................... 55,649
30,000 Huaneng Power International, Inc....... 11,636
12,000 Hutchison Whampoa, Ltd................. 148,868
600,000 PetroChina Co., Ltd.................... 126,173
10,000 Swire Pacific, Ltd., Class A........... 61,676
-------------
881,704
-------------
JAPAN - 39.75%
18,000 Bank of Tokyo-Mitsubishi, Ltd.......... 215,796
6,000 Canon, Inc............................. 237,942
30 East Japan Railway Co.................. 172,274
6,000 Fujitsu, Ltd........................... 106,827
200 Nippon Telegraph & Telephone Corp...... 181,891
4,000 Shin-Etsu Chemical Co., Ltd............ 164,123
4,000 Takeda Chemical Industries, Ltd. ...... 263,403
5,000 Tokyo Broadcasting System, Inc. ....... 195,537
6,000 Toyota Motor Corp...................... 239,591
-------------
1,777,384
-------------
MALAYSIA - 0.91%
20,000 Gamuda Berhad.......................... 22,948
10,000 Resorts World Berhad................... 17,501
-------------
40,449
-------------
SINGAPORE - 8.46%
6,000 Chartered Semiconductor
Manufacturing, Ltd.*................... 25,976
40,000 Keppel Land, Ltd....................... 59,699
15,000 Overseas Union Bank, Ltd............... 72,631
10,000 Singapore Airlines, Ltd................ 100,259
5,000 Singapore Press Holdings, Ltd.......... 71,491
5,000 Venture Manufacturing, Ltd............. 48,420
-------------
378,476
-------------
SOUTH KOREA - 6.13%
1,200 Cheil Communications, Inc. ............ 77,014
2,000 Kookmin Bank........................... 22,858
5,000 Korea Electric Power Corp.............. 111,652
500 Samsung Electronics.................... 62,640
-------------
274,164
-------------
SHARES VALUE
---------- ---------
TAIWAN - 6.48%
6,000 Ambit Microsystems Corp................ $ 27,812
4,000 Asustek Computer, Inc. ................ 19,901
3,000 Cathay Life Insurance Co., Ltd. ....... 5,377
10,000 Chinatrust Commercial Bank*............ 6,335
23,000 Compal Electronics, Inc. .............. 35,040
7,000 Compeq Manufacturing Co., Ltd.......... 26,391
7,000 Delta Electronics, Inc................. 22,281
6,000 Hon Hai Precision Industry Co., Ltd. .. 31,335
15,000 Nan Ya Plastic Corp.................... 17,846
11,000 Taiwan Semiconductor Manufacturing
Co., Ltd.*............................. 33,313
3,100 United Microelectronics Corp., ADR* ... 35,263
27,000 Universal Scientific Industrial Co., Ltd.* 24,030
7,200 Yuanta Core Pacific Securities Co., Ltd.* 4,583
-------------
289,507
-------------
TOTAL COMMON STOCKS ................... 3,641,684
-------------
(Cost $3,936,076)
PAR VALUE
----------
REPURCHASE AGREEMENT - 15.05%
$ 673,000 Repurchase agreement with:
State Street Bank
6.55%, Due 11/01/2000, dated 10/31/2000
Repurchase Price $673,122
(Collateralized by U.S. Treasury Note
7.50%, Due 11/15/2001;
Total Par $660,000,
Market Value $690,363)................. 673,000
-------------
TOTAL REPURCHASE AGREEMENT ............ 673,000
-------------
(Cost $673,000)
TOTAL INVESTMENTS - 96.50%................................ 4,314,684
-------------
(Cost $4,609,076)
NET OTHER ASSETS AND LIABILITIES - 3.50%.................. 156,677
-------------
NET ASSETS - 100.00%...................................... $ 4,471,361
=============
-----------------------------------
* Non-income producing security.
ADR American Depositary Receipt
--------------------------------------------------------------------------------
INDUSTRY CONCENTRATION OF COMMON STOCKS
AS A PERCENTAGE OF NET ASSETS:
Consumer Cyclical 24.54%
Technology 20.63
Finance 11.54
Communications 7.58
Industrial 6.34
Diversified 4.71
Utilities 3.25
Energy 2.86
--------
81.45%
========
SEE NOTES TO FINANCIAL STATEMENTS.
49
<PAGE>
GALAXY EQUITY FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
OCTOBER 31, 2000
<TABLE>
<CAPTION>
ASSET ALLOCATION EQUITY INCOME GROWTH AND INCOME STRATEGIC EQUITY
FUND FUND FUND FUND
---------------- ------------- ----------------- ----------------
<S> <C> <C> <C> <C>
ASSETS:
Investments (Note 2):
Investments at cost............................... $ 633,931,300 $ 238,340,413 $ 733,663,109 $ 81,975,410
Repurchase agreement.............................. -- 25,669,000 37,319,000 10,836,000
Net unrealized appreciation (depreciation)........ 157,129,196 35,038,051 293,404,912 10,540,754
------------- ------------- --------------- -------------
Total investments at value........................ 791,060,496 299,047,464 1,064,387,021 103,352,164
Cash and foreign currency*.......................... 2,430 720 534 196
Receivable for investments sold..................... 180,361 -- 47,454,971 640,655
Receivable for shares sold.......................... 1,646,233 246,085 484,958 55,391
Interest and dividends receivable................... 4,972,727 424,489 662,051 89,623
Tax reclaim receivable.............................. -- -- -- --
Deferred organizational expense (Note 2)............ -- -- -- 7,941
Prepaid expenses.................................... -- -- -- --
Receivable from Investment Advisor (Note 4)......... -- -- -- --
------------- ------------- --------------- -------------
Total Assets...................................... 797,862,247 299,718,758 1,112,989,535 104,145,970
------------- ------------- --------------- -------------
LIABILITIES:
Unrealized depreciation on open forward
foreign currency contracts ....................... -- -- -- --
Payable for investments purchased................... 2,534,418 -- 11,969,429 448,522
Payable for shares repurchased...................... 1,462,287 386,407 4,486,536 --
Advisory fee payable (Note 3)....................... 500,837 184,301 669,009 45,500
Payable to Fleet affiliates (Note 3)................ 215,699 47,414 107,684 506
Payable to Administrator (Note 3)................... 113,734 49,230 112,172 11,961
Trustees' fees and expenses payable (Note 3)........ 23,948 13,429 24,645 2,023
Accrued expenses and other payables................. 116,933 74,482 174,121 20,192
------------- ------------- --------------- -------------
Total Liabilities................................. 4,967,856 755,263 17,543,596 528,704
------------- ------------- --------------- -------------
NET ASSETS............................................. $ 792,894,391 $ 298,963,495 $ 1,095,445,939 $ 103,617,266
============= ============= =============== =============
</TABLE>
---------------------------------------------------------
* Cost of foreign currency is $2,046,287 and $38,754 for the International
Equity Fund and Pan Asia Fund, respectively.
SEE NOTES TO FINANCIAL STATEMENTS.
50
<PAGE>
<TABLE>
<CAPTION>
EQUITY VALUE EQUITY GROWTH GROWTH SMALL CAP
FUND FUND FUND II VALUE FUND
-------------- ---------------- ------------- --------------
<S> <C> <C> <C> <C>
ASSETS:
Investments (Note 2):
Investments at cost............................... $ 357,999,617 $ 1,251,863,607 $ 88,598,960 $ 385,559,584
Repurchase agreement.............................. 4,079,000 66,359,000 8,734,000 49,600,000
Net unrealized appreciation (depreciation)........ 53,721,183 658,449,993 54,278,971 (9,710,461)
-------------- ---------------- ------------- --------------
Total investments at value........................ 415,799,800 1,976,672,600 151,611,931 425,449,123
Cash and foreign currency*.......................... 656 153 51,191 949
Receivable for investments sold..................... 22,827,066 -- -- 690,899
Receivable for shares sold.......................... 188,704 2,024,029 149,080 347,074
Interest and dividends receivable................... 155,191 939,548 74,382 165,410
Tax reclaim receivable.............................. -- -- -- --
Deferred organizational expense (Note 2)............ -- -- -- --
Prepaid expenses.................................... -- -- -- --
Receivable from Investment Advisor (Note 4)......... -- -- -- --
-------------- ---------------- ------------- -------------
Total Assets...................................... 438,971,417 1,979,636,330 151,886,584 426,653,455
-------------- ---------------- ------------- -------------
LIABILITIES:
Unrealized depreciation on open forward
foreign currency contracts ....................... -- -- -- --
Payable for investments purchased................... 14,801,492 1,369,375 145,167 2,745,884
Payable for shares repurchased...................... 1,374,034 6,510,502 51,025 116,123
Advisory fee payable (Note 3)....................... 255,721 1,219,319 52,540 263,151
Payable to Fleet affiliates (Note 3)................ 89,711 277,604 2,156 31,870
Payable to Administrator (Note 3)................... 71,698 213,405 10,578 57,425
Trustees' fees and expenses payable (Note 3)........ 21,188 58,208 823 13,061
Accrued expenses and other payables................. 103,174 233,012 3,363 69,676
-------------- ---------------- ------------- --------------
Total Liabilities................................. 16,717,018 9,881,425 265,652 3,297,190
-------------- ---------------- ------------- --------------
NET ASSETS............................................. $ 422,254,399 $ 1,969,754,905 $ 151,620,932 $ 423,356,265
============== ================ ============= ==============
</TABLE>
<TABLE>
<CAPTION>
SMALL COMPANY INTERNATIONAL PAN ASIA
EQUITY FUND EQUITY FUND FUND
--------------- --------------- -------------
<S> <C> <C> <C>
ASSETS:
Investments (Note 2):
Investments at cost............................... $ 478,752,587 $ 986,498,815 $ 3,936,076
Repurchase agreement.............................. 36,455,000 34,872,000 673,000
Net unrealized appreciation (depreciation)........ 47,698,114 20,186,963 (294,392)
--------------- --------------- -------------
Total investments at value........................ 562,905,701 1,041,557,778 4,314,684
Cash and foreign currency*.......................... 11,522 2,047,222 92,167
Receivable for investments sold..................... 8,647,175 16,604,196 168,698
Receivable for shares sold.......................... 3,007,134 14,352,997 6,433
Interest and dividends receivable................... 96,709 1,211,311 7,699
Tax reclaim receivable.............................. -- 937,264 --
Deferred organizational expense (Note 2)............ -- -- --
Prepaid expenses.................................... -- -- 32,433
Receivable from Investment Advisor (Note 4)......... -- -- 24,472
--------------- --------------- -------------
Total Assets...................................... 574,668,241 1,076,710,768 4,646,586
--------------- --------------- -------------
LIABILITIES:
Unrealized depreciation on open forward
foreign currency contracts ....................... -- 177,372 --
Payable for investments purchased................... 4,422,306 6,189,468 159,438
Payable for shares repurchased...................... 2,695,141 1,924,452 --
Advisory fee payable (Note 3)....................... 353,820 553,874 --
Payable to Fleet affiliates (Note 3)................ 79,605 60,305 106
Payable to Administrator (Note 3)................... 72,787 124,626 4,151
Trustees' fees and expenses payable (Note 3)........ 17,801 21,880 6
Accrued expenses and other payables................. 84,508 151,998 11,524
--------------- --------------- -------------
Total Liabilities................................. 7,725,968 9,203,975 175,225
--------------- --------------- -------------
NET ASSETS............................................. $ 566,942,273 $ 1,067,506,793 $ 4,471,361
=============== =============== =============
</TABLE>
51
<PAGE>
GALAXY EQUITY FUNDS
STATEMENTS OF ASSETS AND LIABILITIES (CONTINUED)
OCTOBER 31, 2000
<TABLE>
<CAPTION>
ASSET ALLOCATION EQUITY INCOME GROWTH AND INCOME STRATEGIC EQUITY
FUND FUND FUND FUND
---------------- ------------- ----------------- ----------------
<S> <C> <C> <C> C>
NET ASSETS CONSISTS OF:
Par value (Note 5)........................................ $ 42,230 $ 16,820 $ 66,761 $ 9,894
Paid in capital in excess of par value.................... 602,681,179 224,486,432 718,438,713 90,092,799
Undistributed net investment income (loss)................ 2,323,069 235,554 (9,984) 83,697
Accumulated net realized gain on investments sold......... 30,718,717 39,186,638 83,545,537 2,890,122
Net unrealized appreciation (depreciation) of investments,
foreign currency and forward currency contracts......... 157,129,196 35,038,051 293,404,912 10,540,754
------------- ------------- -------------- -------------
TOTAL NET ASSETS............................................. $ 792,894,391 $ 298,963,495 $1,095,445,939 $ 103,617,266
============= ============= ============== =============
Retail A Shares:
Net Assets................................................ $ 371,589,848 $ 188,846,775 $ 217,422,860 $ 8,504,681
Shares of beneficial interest outstanding................. 19,781,033 10,628,576 13,278,358 812,892
NET ASSET VALUE and redemption price per share............ $ 18.79 $ 17.77 $ 16.37 $ 10.46
Sales charge - 3.75% of offering price.................... 0.73 0.69 0.64 0.41
------------- ------------- -------------- -------------
Maximum offering price per share.......................... $ 19.52 $ 18.46 $ 17.01 $ 10.87
============= ============= ============== =============
Retail B Shares:
Net Assets................................................ $ 105,979,701 $ 3,969,164 $ 61,856,518 $ 1,554,784
Shares of beneficial interest outstanding................. 5,654,372 226,832 3,812,300 149,985
------------- ------------- -------------- -------------
NET ASSET VALUE and offering price per share* ............ $ 18.74 $ 17.50 $ 16.23 $ 10.37
============= ============= ============== =============
Trust Shares:
Net Assets................................................ $ 290,970,468 $ 106,147,556 $ 678,397,628 $ 93,557,801
Shares of beneficial interest outstanding................. 15,497,354 5,964,492 41,283,580 8,931,479
------------- ------------- -------------- -------------
NET ASSET VALUE, offering and redemption price per share $ 18.78 $ 17.80 $ 16.43 $ 10.48
============= ============= ============== =============
Prime A Shares:
Net Assets................................................ $ 186,144 N/A $ 155,839 N/A
Shares of beneficial interest outstanding................. 9,915 N/A 9,499 N/A
NET ASSET VALUE and redemption price per share............ $ 18.77 N/A $ 16.41 N/A
Sales charge - 5.50% of offering price ................... 1.10 N/A 0.96 N/A
------------- ------------- -------------- -------------
Maximum offering price per share.......................... $ 19.87 N/A $ 17.37 N/A
============= ============= ============== =============
Prime B Shares:
Net Assets................................................ $ 526,105 N/A $ 129,355 N/A
Shares of beneficial interest outstanding................. 28,053 N/A 7,928 N/A
------------- ------------- -------------- -------------
NET ASSET VALUE and offering price per share*............. $ 18.75 N/A $ 16.32 N/A
============= ============= ============== =============
BKB Shares:
Net Assets................................................ $ 23,642,125 N/A $ 137,483,739 N/A
Shares of beneficial interest outstanding................. 1,259,497 N/A 8,369,336 N/A
------------- ------------- -------------- -------------
NET ASSET VALUE, offering and redemption price per share.. $ 18.77 N/A $ 16.43 N/A
============= ============= ============== =============
</TABLE>
---------------------------------------------------------------------------
* Redemption price per share is equal to the Net Asset Value per share less
any applicable contingent deferred sales charge.
SEE NOTES TO FINANCIAL STATEMENTS.
52
<PAGE>
<TABLE>
<CAPTION>
EQUITY VALUE EQUITY GROWTH GROWTH SMALL CAP
FUND FUND FUND II VALUE FUND
-------------- --------------- ------------- --------------
<S> <C> <C> <C> <C>
NET ASSETS CONSISTS OF:
Par value (Note 5)........................................ $ 24,734 $ 60,752 $ 10,310 $ 29,502
Paid in capital in excess of par value.................... 303,274,596 1,094,860,410 84,154,266 377,207,910
Undistributed net investment income (loss)................ (9,999) (26,682) (2,277) 432,214
Accumulated net realized gain on investments sold......... 65,243,885 216,410,432 13,180,008 55,397,100
Net unrealized appreciation (depreciation) of investments,
foreign currency and forward currency contracts......... 53,721,183 658,449,993 54,278,625 (9,710,461)
------------- -------------- ------------- -------------
TOTAL NET ASSETS............................................. $ 422,254,399 $1,969,754,905 $ 151,620,932 $ 423,356,265
============= ============== ============= =============
Retail A Shares:
Net Assets................................................ $ 226,835,530 $ 580,416,654 $ 1,637,582 $ 87,456,732
Shares of beneficial interest outstanding................. 13,304,783 17,964,598 111,564 6,136,578
NET ASSET VALUE and redemption price per share............ $ 17.05 $ 32.31 $ 14.68 $ 14.25
Sales charge - 3.75% of offering price.................... 0.66 1.26 0.57 0.56
------------- -------------- ------------- -------------
Maximum offering price per share.......................... $ 17.71 $ 33.57 $ 15.25 $ 14.81
============= ============== ============= =============
Retail B Shares:
Net Assets................................................ $ 30,555,086 $ 130,347,191 $ 688,103 $ 2,838,453
Shares of beneficial interest outstanding................. 1,826,772 4,174,491 46,859 200,890
------------- -------------- ------------- -------------
NET ASSET VALUE and offering price per share* ............ $ 16.73 $ 31.22 $ 14.68 $ 14.13
============= ============== ============= =============
Trust Shares:
Net Assets................................................ $ 164,863,783 $1,258,399,142 $ 90,450,798 $ 332,702,640
Shares of beneficial interest outstanding................. 9,602,868 38,594,197 6,149,232 23,139,534
------------- -------------- ------------- -------------
NET ASSET VALUE, offering and redemption price per share $ 17.17 $ 32.61 $ 14.71 $ 14.38
============= ============== ============= =============
Prime A Shares:
Net Assets................................................ N/A $ 142,348 N/A $ 188,847
Shares of beneficial interest outstanding................. N/A 4,405 N/A 13,179
NET ASSET VALUE and redemption price per share............ N/A $ 32.31 N/A $ 14.33
Sales charge - 5.50% of offering price ................... N/A 1.88 N/A 0.83
------------- -------------- ------------- -------------
Maximum offering price per share.......................... N/A $ 34.19 N/A $ 15.16
============= ============== ============= =============
Prime B Shares:
Net Assets................................................ N/A $ 449,570 N/A $ 169,593
Shares of beneficial interest outstanding................. N/A 14,076 N/A 11,948
------------- -------------- ------------- -------------
NET ASSET VALUE and offering price per share*............. N/A $ 31.94 N/A $ 14.19
============= ============== ============= =============
BKB Shares:
Net Assets................................................ N/A N/A $ 58,844,449 N/A
Shares of beneficial interest outstanding................. N/A N/A 4,001,961 N/A
------------- -------------- ------------- -------------
NET ASSET VALUE, offering and redemption price per share.. N/A N/A $ 14.70 N/A
============= ============== ============= =============
</TABLE>
<TABLE>
<CAPTION>
SMALL COMPANY INTERNATIONAL PAN ASIA
EQUITY FUND EQUITY FUND FUND
--------------- --------------- -------------
<S> <C> <C> <C>
NET ASSETS CONSISTS OF:
Par value (Note 5)........................................ $ 25,465 $ 54,183 $ 473
Paid in capital in excess of par value.................... 435,529,507 913,687,478 4,721,551
Undistributed net investment income (loss)................ (5,985) 17,632,385 2
Accumulated net realized gain on investments sold......... 83,695,172 116,076,505 45,100
Net unrealized appreciation (depreciation) of investments,
foreign currency and forward currency contracts......... 47,698,114 20,056,242 (295,765)
-------------- --------------- -----------
TOTAL NET ASSETS............................................. $ 566,942,273 $ 1,067,506,793 $ 4,471,361
============== =============== ===========
Retail A Shares:
Net Assets................................................ $ 125,426,907 $ 120,351,060 $ 200,989
Shares of beneficial interest outstanding................. 5,766,740 6,190,349 21,285
NET ASSET VALUE and redemption price per share............ $ 21.75 $ 19.44 $ 9.44
Sales charge - 3.75% of offering price.................... 0.85 0.76 0.37
-------------- --------------- -----------
Maximum offering price per share.......................... $ 22.60 $ 20.20 $ 9.81
============== =============== ===========
Retail B Shares:
Net Assets................................................ $ 18,936,409 $ 8,296,506 $ 19,596
Shares of beneficial interest outstanding................. 897,654 430,259 2,078
-------------- --------------- -----------
NET ASSET VALUE and offering price per share* ............ $ 21.10 $ 19.28 $ 9.43
============== =============== ===========
Trust Shares:
Net Assets................................................ $ 422,578,957 $ 912,544,590 4,245,915
Shares of beneficial interest outstanding................. 18,801,031 46,227,672 449,501
-------------- --------------- -----------
NET ASSET VALUE, offering and redemption price per share $ 22.48 $ 19.74 $ 9.45
============== =============== ===========
Prime A Shares:
Net Assets................................................ N/A $ 14,201 $ 2,431
Shares of beneficial interest outstanding................. N/A 727 257
NET ASSET VALUE and redemption price per share............ N/A $ 19.53 $ 9.45
Sales charge - 5.50% of offering price ................... N/A 1.14 0.55
-------------- --------------- -----------
Maximum offering price per share.......................... N/A $ 20.67 $ 10.00
============== =============== ===========
Prime B Shares:
Net Assets................................................ N/A $ 483,488 $ 2,430
Shares of beneficial interest outstanding................. N/A 24,967 257
-------------- --------------- -----------
NET ASSET VALUE and offering price per share*............. N/A $ 19.37 $ 9.44
============== =============== ===========
BKB Shares:
Net Assets................................................ N/A $ 25,806,948 N/A
Shares of beneficial interest outstanding................. N/A 1,308,848 N/A
-------------- --------------- -----------
NET ASSET VALUE, offering and redemption price per share.. N/A $ 19.72 N/A
============== =============== ===========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
53
<PAGE>
GALAXY EQUITY FUNDS
>
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED OCTOBER 31, 2000
<TABLE>
<CAPTION>
ASSET ALLOCATION EQUITY INCOME GROWTH AND INCOME STRATEGIC EQUITY
FUND FUND FUND FUND
---------------- -------------- ----------------- ----------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest (Note 2)......................................... $ 22,825,751 $ 1,166,213 $ 1,076,840 $ 319,819
Dividends (Note 2)........................................ 2,628,575 5,725,479 10,230,362 1,129,331
Less: foreign taxes withheld (Note 2)..................... -- -- -- --
------------- ------------- ------------- --------------
Total investment income................................. 25,454,326 6,891,692 11,307,202 1,449,150
------------- ------------- ------------- --------------
EXPENSES:
Investment advisory fee (Note 3).......................... 5,783,582 2,317,651 5,899,914 677,715
Administration fee (Note 3)............................... 546,311 220,260 552,479 63,792
Custodian fee ............................................ 61,848 18,036 39,537 15,770
Fund accounting fee (Note 3) ............................. 123,083 64,824 116,858 48,044
Professional fees (Note 3) ............................... 55,489 31,912 53,070 23,405
Transfer agent fee (Note 3) .............................. 1,235,105 311,211 1,163,312 32,741
Shareholder services and 12b-1 fees (Note 3) ............. 2,010,791 589,491 1,318,069 36,293
Trustees' fees and expenses (Note 3) ..................... 19,357 10,190 20,784 3,711
Amortization of organization expense (Note 2) ............ -- -- -- 3,407
Reports to shareholders .................................. 119,206 58,820 123,876 4,271
Miscellaneous ............................................ 120,685 50,980 128,090 43,986
------------- ------------- ------------- --------------
Total expenses before reimbursement/waiver.............. 10,075,457 3,673,375 9,415,989 953,135
------------- ------------- ------------- --------------
Less:reimbursement/waiver (Note 4) ..................... (16,890) (3,815) (300,528) (201,147)
------------- ------------- ------------- --------------
Total expenses net of reimbursement/waiver ............. 10,058,567 3,669,560 9,115,461 751,988
------------- ------------- ------------- --------------
NET INVESTMENT INCOME (LOSS)................................. 15,395,759 3,222,132 2,191,741 697,162
------------- ------------- ------------- --------------
REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS (NOTES 2 &6):
Net realized gainon investments sold ..................... 31,088,652 39,140,662 84,120,712 3,242,360
Net realized gain (loss) on forward foreign currency
contracts and foreign currency ......................... -- -- -- --
Net change in unrealized appreciation (depreciation)
on investments, foreign currency and
forward foreign currency contracts* .................... 24,978,427 (17,842,173) (20,584,890) 14,145,832
------------- ------------- ------------- --------------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS............................................ 56,067,079 21,298,489 63,535,822 17,388,192
------------- ------------- ------------- --------------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS ................................ $ 71,462,838 $ 24,520,621 $ 65,727,563 $ 18,085,354
============= ============= ============= ==============
</TABLE>
-----------------------------------------------------
(1) For the period June 1, 2000 through October 31, 2000.
(2) For the period September 1, 2000 through October 31, 2000.
* Change in unrealized appreciation (depreciation) does not include
unrealized appreciation in connection with the acquisition of the Boston
1784 Funds (see Note 9).
SEE NOTES TO FINANCIAL STATEMENTS.
54
<PAGE>
<TABLE>
<CAPTION>
EQUITY VALUE EQUITY GROWTH GROWTH SMALL CAP
FUND FUND FUND II(1) VALUE FUND
-------------- --------------- ------------- --------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest (Note 2)......................................... $ 348,229 $ 3,545,880 $ 228,626 $ 1,841,334
Dividends (Note 2)........................................ 6,047,827 14,048,539 165,830 3,944,968
Less: foreign taxes withheld (Note 2)..................... -- -- (8,127) --
------------ ------------- ------------- -------------
Total investment income................................. 6,396,056 17,594,419 386,329 5,786,302
------------ ------------- ------------- -------------
EXPENSES:
Investment advisory fee (Note 3).......................... 3,812,574 13,911,341 496,751 2,843,896
Administration fee (Note 3)............................... 363,668 1,317,126 44,395 269,338
Custodian fee ............................................ 45,397 25,499 5,947 35,841
Fund accounting fee (Note 3) ............................. 80,537 137,855 13,210 71,010
Professional fees (Note 3) ............................... 27,909 68,983 21,427 33,749
Transfer agent fee (Note 3) .............................. 830,969 1,765,459 21,698 461,149
Shareholder services and 12b-1 fees (Note 3) ............. 983,720 2,447,420 46,254 268,408
Trustees' fees and expenses (Note 3) ..................... 14,657 46,792 1,021 11,960
Amortization of organization expense (Note 2) ............ -- -- -- --
Reports to shareholders .................................. 86,400 215,834 5,971 56,571
Miscellaneous ............................................ 68,895 180,027 66,644 81,128
------------ ------------- -------------- -------------
Total expenses before reimbursement/waiver.............. 6,314,726 20,116,336 723,318 4,133,050
------------ ------------- -------------- -------------
Less:reimbursement/waiver (Note 4) ..................... (11,908) (17,892) (121,053) (100,285)
------------ ------------- -------------- -------------
Total expenses net of reimbursement/waiver ............. 6,302,818 20,098,444 602,265 4,032,765
------------ ------------- -------------- -------------
NET INVESTMENT INCOME (LOSS)................................. 93,238 (2,504,025) (215,936) 1,753,537
------------ ------------- -------------- -------------
REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS (NOTES 2 &6):
Net realized gainon investments sold ..................... 69,230,941 216,840,095 11,930,720 55,384,980
Net realized gain (loss) on forward foreign currency
contracts and foreign currency ......................... -- -- (226) --
Net change in unrealized appreciation (depreciation)
on investments, foreign currency and
forward foreign currency contracts* .................... (32,400,776) 74,473,628 12,444,625 16,865,022
------------ ------------- ------------- -------------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS............................................ 36,830,165 291,313,723 24,375,119 72,250,002
------------ ------------- ------------- -------------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS ................................ $ 36,923,403 $ 288,809,698 $ 24,159,183 $ 74,003,539
============ ============= ============= =============
</TABLE>
<TABLE>
<CAPTION>
SMALL COMPANY INTERNATIONAL PAN ASIA
EQUITY FUND EQUITY FUND FUND(2)
--------------- --------------- -------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest (Note 2)......................................... $ 1,724,254 $ 1,941,865 $ 12,899
Dividends (Note 2)........................................ 747,543 27,440,310 10,135
Less: foreign taxes withheld (Note 2)..................... -- (1,437,839) (1,337)
------------- ------------- -----------
Total investment income................................. 2,471,797 27,944,336 21,697
------------- ------------- -----------
EXPENSES:
Investment advisory fee (Note 3).......................... 4,109,620 7,720,119 8,172
Administration fee (Note 3)............................... 388,798 624,039 456
Custodian fee ............................................ 256,147 738,656 8,780
Fund accounting fee (Note 3) ............................. 97,707 163,691 8,280
Professional fees (Note 3) ............................... 36,237 63,822 7,448
Transfer agent fee (Note 3) .............................. 835,873 669,291 1,037
Shareholder services and 12b-1 fees (Note 3) ............. 487,327 350,413 178
Trustees' fees and expenses (Note 3) ..................... 14,035 21,619 6
Amortization of organization expense (Note 2) ............ -- -- --
Reports to shareholders .................................. 53,995 59,859 168
Miscellaneous ............................................ 95,924 125,591 7,089
------------- ------------- -----------
Total expenses before reimbursement/waiver.............. 6,375,663 10,537,100 41,614
------------- ------------- -----------
Less:reimbursement/waiver (Note 4) ..................... (3,924) (2,229,162) (30,833)
------------- ------------- -----------
Total expenses net of reimbursement/waiver ............. 6,371,739 8,307,938 10,781
------------- ------------- -----------
NET INVESTMENT INCOME (LOSS)................................. (3,899,942) 19,636,398 10,916
------------- ------------- -----------
REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS (NOTES 2 &6):
Net realized gainon investments sold ..................... 120,456,546 116,078,204 49,697
Net realized gain (loss) on forward foreign currency
contracts and foreign currency ......................... -- (445,484) (15,511)
Net change in unrealized appreciation (depreciation)
on investments, foreign currency and
forward foreign currency contracts* .................... 56,876 (205,754,102) (295,765)
------------- ------------- -----------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS............................................ 120,513,422 (90,121,382) (261,579)
------------- ------------- -----------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS ................................ $ 116,613,480 $ (70,484,984) $ (250,663)
============= ============= ===========
</TABLE>
55
<PAGE>
GALAXY EQUITY FUNDS
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED MAY 31, 2000
GROWTH
FUND II
--------------
INVESTMENT INCOME:
Interest (Note 2)........................................ $ 901,000
Dividends (Note 2)....................................... 449,000
--------------
Total investment income................................ 1,350,000
--------------
EXPENSES:
Investment advisory fee (Note 3)......................... 1,827,000
Administration fee (Note 3).............................. 159,000
Custodian fee ........................................... 29,000
Professional fees (Note 3) .............................. 18,000
Transfer agent fee (Note 3) ............................. 112,000
Shareholder services and 12b-1 fees (Note 3) ............ 617,000
Trustees' fees and expenses (Note 3) .................... 6,000
Reports to shareholders ................................. 11,000
Miscellaneous ........................................... 14,000
--------------
Total expenses before reimbursement/waiver............. 2,793,000
--------------
Less:reimbursement/waiver (Note 4) .................... (617,000)
--------------
Total expenses net of reimbursement/waiver ............ 2,176,000
--------------
NET INVESTMENT (LOSS)....................................... (826,000)
--------------
REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS (NOTES 2 &6):
Net realized gainon investments sold .................... 151,640,000*
Net realized gain on forward foreign currency
contracts and foreign currency ........................ 6,000
Net change in unrealized depreciation
on investments, foreign currency and
forward foreign currency contracts .................... (13,707,000)
--------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS...... 137,939,000
--------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS ............................... $ 137,113,000
==============
--------------------------------------------------
* On April 10, 2000, the Fund had a redemption in kind with total proceeds in
the amount of $69,327,239. The net realized gains of the transactions of
$32,145,987 will not be realized for tax purposes.
SEE NOTES TO FINANCIAL STATEMENTS.
56
<PAGE>
This page left blank intentionally.
<PAGE>
GALAXY EQUITY FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
ASSET ALLOCATION FUND
------------------------------------
YEARS ENDED
OCTOBER 31,
2000 1999
-------------- --------------
<S> <C> <C>
NET ASSETS AT BEGINNING OF THE PERIOD........................................... $ 750,884,394 $ 600,040,305
-------------- --------------
INCREASE IN NET ASSETS RESULTING FROM OPERATIONS:
Net investment income........................................................ 15,395,759 15,025,994
Net realized gain on investments sold........................................ 31,088,652 12,946,175
Net change in unrealized appreciation (depreciation) on investments.......... 24,978,427 30,773,026
-------------- --------------
Net increase in net assets resulting from operations....................... 71,462,838 58,745,195
-------------- --------------
DIVIDENDS TO SHAREHOLDERS FROM:
RETAIL A SHARES:
Net investment income........................................................ (7,745,999) (7,777,489)
Dividends in excess of net investment income................................. -- --
Net realized gain on investments............................................. (6,720,946) (8,515,996)
-------------- --------------
Total Dividends............................................................ (14,466,945) (16,293,485)
-------------- --------------
RETAIL B SHARES:
Net investment income ....................................................... (1,330,013) (1,070,246)
Net realized gain on investments............................................. (1,621,536) (1,510,323)
-------------- --------------
Total Dividends............................................................ (2,951,549) (2,580,569)
-------------- --------------
TRUST SHARES:
Net investment income ....................................................... (6,071,628) (5,707,139)
Dividends in excess of net investment income................................. -- --
Net realized gain on investments............................................. (4,679,919) (5,671,923)
-------------- --------------
Total Dividends............................................................ (10,751,547) (11,379,062)
-------------- --------------
PRIME A SHARES:
Net investment income ....................................................... (4,294) (3,417)
Net realized gain on investments............................................. (3,208) (880)
-------------- --------------
Total Dividends............................................................ (7,502) (4,297)
-------------- --------------
PRIME B SHARES:
Net investment income ....................................................... (7,967) (4,760)
Net realized gain on investments............................................. (9,571) (3,982)
-------------- --------------
Total Dividends............................................................ (17,538) (8,742)
-------------- --------------
BKB SHARES:
Net investment income ....................................................... (148,232) N/A
Dividends in excess of net investment income................................. -- N/A
-------------- --------------
Total Dividends............................................................ (148,232) N/A
-------------- --------------
Total Dividends to shareholders............................................ (28,343,313) (30,266,155)
-------------- --------------
NET INCREASE (DECREASE) FROM SHARE TRANSACTIONS(1).............................. (1,109,528) 122,365,049
-------------- --------------
Net increase (decrease) in net assets........................................ 42,009,997 150,844,089
-------------- --------------
NET ASSETS AT END OF THE PERIOD (INCLUDING LINE A).............................. $ 792,894,391 $ 750,884,394
============== ==============
(A) Undistributed net investment income (loss).................................. $ 2,323,069 $ 2,165,168
============== ==============
</TABLE>
--------------------------------------------------------------
(1) For detail on share transactions by series, see Statements of Changes in
Net Assets - Capital Stock Activity on pages 64-66.
SEE NOTES TO FINANCIAL STATEMENTS.
58
<PAGE>
<TABLE>
<CAPTION>
EQUITY INCOME FUND
------------------------------------
YEARS ENDED
OCTOBER 31,
2000 1999
-------------- --------------
<S> <C> <C>
NET ASSETS AT BEGINNING OF THE PERIOD........................................... $ 336,432,455 $ 335,217,600
-------------- --------------
INCREASE IN NET ASSETS RESULTING FROM OPERATIONS:
Net investment income........................................................ 3,222,132 3,904,177
Net realized gain on investments sold........................................ 39,140,662 50,110,091
Net change in unrealized appreciation (depreciation) on investments.......... (17,842,173) (20,073,324)
-------------- --------------
Net increase in net assets resulting from operations....................... 24,520,621 33,940,944
-------------- --------------
DIVIDENDS TO SHAREHOLDERS FROM:
RETAIL A SHARES:
Net investment income........................................................ (1,842,015) (2,242,878)
Dividends in excess of net investment income................................. -- --
Net realized gain on investments............................................. (31,691,075) (19,453,842)
-------------- --------------
Total Dividends............................................................ (33,533,090) (21,696,720)
-------------- --------------
RETAIL B SHARES:
Net investment income ....................................................... (8,791) (5,615)
Net realized gain on investments............................................. (524,089) (10,594)
-------------- --------------
Total Dividends............................................................ (532,880) (16,209)
-------------- --------------
TRUST SHARES:
Net investment income ....................................................... (1,443,996) (1,851,694)
Dividends in excess of net investment income................................. -- --
Net realized gain on investments............................................. (17,919,446) (11,818,814)
-------------- --------------
Total Dividends............................................................ (19,363,442) (13,670,508)
-------------- --------------
PRIME A SHARES:
Net investment income ....................................................... N/A N/A
Net realized gain on investments............................................. N/A N/A
-------------- --------------
Total Dividends............................................................ N/A N/A
-------------- --------------
PRIME B SHARES:
Net investment income ....................................................... N/A N/A
Net realized gain on investments............................................. N/A N/A
-------------- --------------
Total Dividends............................................................ N/A N/A
-------------- --------------
BKB SHARES:
Net investment income ....................................................... N/A N/A
Dividends in excess of net investment income................................. N/A N/A
-------------- --------------
Total Dividends............................................................ N/A N/A
-------------- --------------
Total Dividends to shareholders............................................ (53,429,412) (35,383,437)
-------------- --------------
NET INCREASE (DECREASE) FROM SHARE TRANSACTIONS(1).............................. (8,560,169) 2,657,348
-------------- --------------
Net increase (decrease) in net assets........................................ (37,468,960) 1,214,855
-------------- --------------
NET ASSETS AT END OF THE PERIOD (INCLUDING LINE A).............................. $ 298,963,495 $ 336,432,455
============== ==============
(A) Undistributed net investment income (loss).................................. $ 235,554 $ 399,503
============== ==============
</TABLE>
<TABLE>
<CAPTION>
GROWTH AND INCOME FUND
------------------------------------
YEARS ENDED
OCTOBER 31,
2000 1999
-------------- --------------
<S> <C> <C>
NET ASSETS AT BEGINNING OF THE PERIOD........................................... $ 603,862,075 $ 521,385,834
-------------- --------------
INCREASE IN NET ASSETS RESULTING FROM OPERATIONS:
Net investment income........................................................ 2,191,741 3,509,427
Net realized gain on investments sold........................................ 84,120,712 33,835,048
Net change in unrealized appreciation (depreciation) on investments.......... (20,584,890) 38,430,506
-------------- --------------
Net increase in net assets resulting from operations....................... 65,727,563 75,774,981
-------------- --------------
DIVIDENDS TO SHAREHOLDERS FROM:
RETAIL A SHARES:
Net investment income........................................................ (744,359) (1,218,495)
Dividends in excess of net investment income................................. (1,709) --
Net realized gain on investments............................................. (13,038,412) (13,044,487)
-------------- --------------
Total Dividends............................................................ (13,784,480) (14,262,982)
-------------- --------------
RETAIL B SHARES:
Net investment income ....................................................... -- --
Net realized gain on investments............................................. (3,563,567) (3,253,512)
-------------- --------------
Total Dividends............................................................ (3,563,567) (3,253,512)
-------------- --------------
TRUST SHARES:
Net investment income ....................................................... (1,670,332) (2,242,502)
Dividends in excess of net investment income................................. (3,836) --
Net realized gain on investments............................................. (17,166,606) (15,292,610)
-------------- --------------
Total Dividends............................................................ (18,840,774) (17,535,112)
-------------- --------------
PRIME A SHARES:
Net investment income ....................................................... (617) (598)
Net realized gain on investments............................................. (8,534) (1,743)
-------------- --------------
Total Dividends............................................................ (9,151) (2,341)
-------------- --------------
PRIME B SHARES:
Net investment income ....................................................... -- (8)
Net realized gain on investments............................................. (7,365) (300)
-------------- --------------
Total Dividends............................................................ (7,365) (308)
-------------- --------------
BKB SHARES:
Net investment income ....................................................... (89,163) N/A
Dividends in excess of net investment income................................. (205) N/A
-------------- --------------
Total Dividends............................................................ (89,368) N/A
-------------- --------------
Total Dividends to shareholders............................................ (36,294,705) (35,054,255)
-------------- --------------
NET INCREASE (DECREASE) FROM SHARE TRANSACTIONS(1).............................. 462,151,006 41,755,515
-------------- --------------
Net increase (decrease) in net assets........................................ 491,583,864 82,476,241
-------------- --------------
NET ASSETS AT END OF THE PERIOD (INCLUDING LINE A).............................. $1,095,445,939 $ 603,862,075
============== ==============
(A) Undistributed net investment income (loss).................................. $ (9,984) $ 148,148
============== ==============
</TABLE>
<TABLE>
<CAPTION>
STRATEGIC EQUITY FUND
-----------------------------------
YEARS ENDED
OCTOBER 31,
2000 1999
------------- -------------
<S> <C> <C>
NET ASSETS AT BEGINNING OF THE PERIOD........................................... $ 80,639,286 $ 67,694,596
------------- -------------
INCREASE IN NET ASSETS RESULTING FROM OPERATIONS:
Net investment income........................................................ 697,162 626,431
Net realized gain on investments sold........................................ 3,242,360 9,902,448
Net change in unrealized appreciation (depreciation) on investments.......... 14,145,832 (8,471,056)
------------- -------------
Net increase in net assets resulting from operations....................... 18,085,354 2,057,823
------------- -------------
DIVIDENDS TO SHAREHOLDERS FROM:
RETAIL A SHARES:
Net investment income........................................................ (31,806) (21,093)
Dividends in excess of net investment income................................. -- --
Net realized gain on investments............................................. (925,957) (4,996)
------------- -------------
Total Dividends............................................................ (957,763) (26,089)
------------- -------------
RETAIL B SHARES:
Net investment income ....................................................... (651) --
Net realized gain on investments............................................. (172,346) (642)
------------- -------------
Total Dividends............................................................ (172,997) (642)
------------- -------------
TRUST SHARES:
Net investment income ....................................................... (653,246) (537,251)
Dividends in excess of net investment income................................. -- --
Net realized gain on investments............................................. (8,843,322) (74,902)
------------- -------------
Total Dividends............................................................ (9,496,568) (612,153)
------------- -------------
PRIME A SHARES:
Net investment income ....................................................... N/A N/A
Net realized gain on investments............................................. N/A N/A
------------- -------------
Total Dividends............................................................ N/A N/A
------------- -------------
PRIME B SHARES:
Net investment income ....................................................... N/A N/A
Net realized gain on investments............................................. N/A N/A
------------- -------------
Total Dividends............................................................ N/A N/A
------------- -------------
BKB SHARES:
Net investment income ....................................................... N/A N/A
Dividends in excess of net investment income................................. N/A N/A
------------- -------------
Total Dividends............................................................ N/A N/A
------------- -------------
Total Dividends to shareholders............................................ (10,627,328) (638,884)
------------- -------------
NET INCREASE (DECREASE) FROM SHARE TRANSACTIONS(1).............................. 15,519,954 11,525,751
------------- -------------
Net increase (decrease) in net assets........................................ 22,977,980 12,944,690
------------- -------------
NET ASSETS AT END OF THE PERIOD (INCLUDING LINE A).............................. $ 103,617,266 $ 80,639,286
============= =============
(A) Undistributed net investment income (loss).................................. $ 83,697 $ 80,428
============= =============
</TABLE>
59
<PAGE>
GALAXY EQUITY FUNDS
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
EQUITY VALUE FUND
------------------------------------
YEARS ENDED
OCTOBER 31,
2000 1999
-------------- --------------
<S> <C> <C>
NET ASSETS AT BEGINNING OF THE PERIOD........................................... $ 570,384,032 $ 512,264,110
-------------- --------------
INCREASE IN NET ASSETS RESULTING FROM OPERATIONS:
Net investment income (loss)................................................. 93,238 (123,979)
Net realized gain on investments sold ....................................... 69,230,941 72,106,510
Net change in unrealized appreciation (depreciation) on investments ......... (32,400,776) 2,099,234
-------------- --------------
Net increase (decrease) in net assets resulting from operations............ 36,923,403 74,081,765
-------------- --------------
DIVIDENDS TO SHAREHOLDERS FROM:
RETAIL A SHARES:
Net investment income ....................................................... (107,490) --
Dividends in excess of net investment income................................. (1,289) --
Net realized gain on investments............................................. (34,018,274) (8,586,482)
-------------- --------------
Total Dividends............................................................ (34,127,053) (8,586,482)
-------------- --------------
RETAIL B SHARES:
Net investment income ....................................................... -- --
Net realized gain on investments............................................. (4,196,203) (858,586)
-------------- --------------
Total Dividends............................................................ (4,196,203) (858,586)
-------------- --------------
SHARES*:
Net investment income ....................................................... N/A N/A
Dividends in excess of net investment income................................. N/A N/A
Net realized gain on investments............................................. N/A N/A
-------------- --------------
Total Dividends............................................................ N/A N/A
-------------- --------------
TRUST SHARES:
Net investment income ....................................................... (379,593) --
Dividends in excess of net investment income................................. (4,551) --
Net realized gain on investments............................................. (36,588,334) (9,364,080)
-------------- --------------
Total Dividends............................................................ (36,972,478) (9,364,080)
-------------- --------------
PRIME A SHARES:
Net investment income ....................................................... N/A N/A
Net realized gain on investments............................................. N/A N/A
-------------- --------------
Total Dividends............................................................ N/A N/A
-------------- --------------
PRIME B SHARES:
Net investment income ....................................................... N/A N/A
Net realized gain on investments............................................. N/A N/A
-------------- --------------
Total Dividends............................................................ N/A N/A
-------------- --------------
Total Dividends to shareholders............................................ (75,295,734) (18,809,148)
-------------- --------------
NET INCREASE (DECREASE) FROM SHARE TRANSACTIONS(1).............................. (109,757,302) 2,847,305
-------------- --------------
Net increase (decrease) in net assets........................................ (148,129,633) 58,119,922
-------------- --------------
NET ASSETS AT END OF THE PERIOD (INCLUDING LINE A)............................. $ 422,254,399 $ 570,384,032
============== ==============
(A) Undistributed net investment income (loss).................................. $ (9,999) $ --
============== ==============
</TABLE>
---------------------------------------------------------------------
(1) For detail on share transactions by series, see Statements of Changes in
Net Assets - Capital Stock Activity on pages 67-68.
(2) For the period June 1, 2000 through October 31, 2000.
* Prior to June 26, 2000, the Growth Fund II offered only one series of
shares (See Note 9).
SEE NOTES TO FINANCIAL STATEMENTS.
60
<PAGE>
<TABLE>
<CAPTION>
EQUITY GROWTH FUND
----------------------------------------
YEARS ENDED
OCTOBER 31,
2000 1999
---------------- ----------------
<S> <C> <C>
NET ASSETS AT BEGINNING OF THE PERIOD........................................... $ 1,556,895,532 $ 1,163,399,747
---------------- ----------------
INCREASE IN NET ASSETS RESULTING FROM OPERATIONS:
Net investment income (loss)................................................. (2,504,025) (80,529)
Net realized gain on investments sold ....................................... 216,840,095 93,657,340
Net change in unrealized appreciation (depreciation) on investments ......... 74,473,628 229,314,651
---------------- ----------------
Net increase (decrease) in net assets resulting from operations............ 288,809,698 322,891,462
---------------- ----------------
DIVIDENDS TO SHAREHOLDERS FROM:
RETAIL A SHARES:
Net investment income ....................................................... -- --
Dividends in excess of net investment income................................. -- --
Net realized gain on investments............................................. (26,450,852) (24,495,721)
---------------- ----------------
Total Dividends............................................................ (26,450,852) (24,495,721)
---------------- ----------------
RETAIL B SHARES:
Net investment income ....................................................... -- --
Net realized gain on investments............................................. (4,536,918) (2,777,725)
---------------- ----------------
Total Dividends............................................................ (4,536,918) (2,777,725)
---------------- ----------------
SHARES*:
Net investment income ....................................................... N/A N/A
Dividends in excess of net investment income................................. N/A N/A
Net realized gain on investments............................................. N/A N/A
---------------- ----------------
Total Dividends............................................................ N/A N/A
---------------- ----------------
TRUST SHARES:
Net investment income ....................................................... (414,455) --
Dividends in excess of net investment income................................. -- --
Net realized gain on investments............................................. (61,281,119) (63,315,181)
---------------- ----------------
Total Dividends............................................................ (61,695,574) (63,315,181)
---------------- ----------------
PRIME A SHARES:
Net investment income ....................................................... -- --
Net realized gain on investments............................................. (6,282) (1,724)
---------------- ----------------
Total Dividends............................................................ (6,282) (1,724)
---------------- ----------------
PRIME B SHARES:
Net investment income ....................................................... -- --
Net realized gain on investments............................................. (14,655) (551)
---------------- ----------------
Total Dividends............................................................ (14,655) (551)
---------------- ----------------
Total Dividends to shareholders............................................ (92,704,281) (90,590,902)
---------------- ----------------
NET INCREASE (DECREASE) FROM SHARE TRANSACTIONS(1).............................. 216,753,956 161,195,225
---------------- ----------------
Net increase (decrease) in net assets........................................ 412,859,373 393,495,785
---------------- ----------------
NET ASSETS AT END OF THE PERIOD (INCLUDING LINE A)............................. $ 1,969,754,905 $ 1,556,895,532
================ ================
(A) Undistributed net investment income (loss).................................. $ (26,682) $ 256,052
================ ================
</TABLE>
<TABLE>
<CAPTION>
GROWTH FUND II
---------------------------------------------------------
PERIOD ENDED YEARS ENDED
OCTOBER 31, OCTOBER 31,
2000(2) 2000 1999
-------------- -------------- -------------
<S> <C> <C> <C>
NET ASSETS AT BEGINNING OF THE PERIOD................................... $ 185,327,472 $ 185,476,000 $ 257,550,000
-------------- -------------- -------------
INCREASE IN NET ASSETS RESULTING FROM OPERATIONS:
Net investment income (loss)......................................... (215,936) (826,000) (772,000)
Net realized gain on investments sold ............................... 11,930,494 151,646,000 4,764,000
Net change in unrealized appreciation (depreciation) on investments . 12,444,625 (13,707,000) (15,346,000)
-------------- -------------- -------------
Net increase (decrease) in net assets resulting from operations.... 24,159,183 137,113,000 (11,354,000)
-------------- -------------- -------------
DIVIDENDS TO SHAREHOLDERS FROM:
RETAIL A SHARES:
Net investment income ............................................... -- N/A N/A
Dividends in excess of net investment income......................... -- N/A N/A
Net realized gain on investments..................................... -- N/A N/A
-------------- -------------- -------------
Total Dividends.................................................... -- N/A N/A
-------------- -------------- -------------
RETAIL B SHARES:
Net investment income ............................................... -- N/A N/A
Net realized gain on investments..................................... -- N/A N/A
-------------- -------------- -------------
Total Dividends.................................................... -- N/A N/A
-------------- -------------- -------------
SHARES*:
Net investment income ............................................... -- -- --
Dividends in excess of net investment income......................... -- -- --
Net realized gain on investments..................................... -- (122,187,000) (6,328,000)
-------------- -------------- -------------
Total Dividends.................................................... -- (122,187,000) (6,328,000)
-------------- -------------- -------------
TRUST SHARES:
Net investment income ............................................... -- N/A N/A
Dividends in excess of net investment income......................... -- N/A N/A
Net realized gain on investments..................................... -- N/A N/A
-------------- -------------- -------------
Total Dividends.................................................... -- N/A N/A
-------------- -------------- -------------
PRIME A SHARES:
Net investment income ............................................... N/A N/A N/A
Net realized gain on investments..................................... N/A N/A N/A
-------------- -------------- -------------
Total Dividends.................................................... N/A N/A N/A
-------------- -------------- -------------
PRIME B SHARES:
Net investment income ............................................... N/A N/A N/A
Net realized gain on investments..................................... N/A N/A N/A
-------------- -------------- -------------
Total Dividends.................................................... N/A N/A N/A
-------------- -------------- -------------
Total Dividends to shareholders.................................... -- (122,187,000) (6,328,000)
-------------- -------------- -------------
NET INCREASE (DECREASE) FROM SHARE TRANSACTIONS(1)...................... (57,865,723) (15,075,000) (54,392,000)
-------------- -------------- -------------
Net increase (decrease) in net assets................................ (33,706,540) (149,000) (72,074,000)
-------------- -------------- -------------
NET ASSETS AT END OF THE PERIOD (INCLUDING LINE A)..................... $ 151,620,932 $ 185,327,000 $ 185,476,000
============== ============== =============
(A) Undistributed net investment income (loss).......................... $ (2,277) $ -- $ (8,000)
============== ============== =============
</TABLE>
61
<PAGE>
GALAXY EQUITY FUNDS
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
SMALL CAP VALUE FUND
------------------------------------
YEARS ENDED
OCTOBER 31,
2000 1999
-------------- --------------
<S> <C> <C>
NET ASSETS AT BEGINNING OF THE PERIOD.................................................. $ 338,139,079 $ 290,165,115
-------------- --------------
INCREASE IN NET ASSETS RESULTING FROM OPERATIONS:
Net investment income (loss).......................................................... 1,753,537 1,242,403
Net realized gain (loss) on investments sold........................................ 55,384,980 34,790,874
Net realized (loss) on forward foreign currency contracts and foreign currency...... -- --
Net change in unrealized appreciation (depreciation) on investments,
foreign currency and forward foreign currency contracts........................... 16,865,022 (19,900,548)
-------------- --------------
Net increase (decrease) in net assets resulting from operations................... 74,003,539 16,132,729
-------------- --------------
DIVIDENDS TO SHAREHOLDERS FROM:
RETAIL A SHARES:
Net investment income .............................................................. (58,750) (181,459)
Net realized gain on investments.................................................... (8,365,694) (8,121,983)
-------------- --------------
Total Dividends................................................................... (8,424,444) (8,303,442)
-------------- --------------
RETAIL B SHARES:
Net investment income .............................................................. -- --
Net realized gain on investments.................................................... (193,642) (6,269)
-------------- --------------
Total Dividends................................................................... (193,642) (6,269)
-------------- --------------
TRUST SHARES:
Net investment income .............................................................. (1,367,503) (1,192,133)
Net realized gain on investments.................................................... (26,198,796) (19,251,259)
-------------- --------------
Total Dividends................................................................... (27,566,299) (20,443,392)
-------------- --------------
PRIME A SHARES:
Net investment income .............................................................. (487) (549)
Net realized gain on investments.................................................... (18,207) (3,618)
-------------- --------------
Total Dividends................................................................... (18,694) (4,167)
-------------- --------------
PRIME B SHARES:
Net investment income .............................................................. -- --
Net realized gain on investments.................................................... (19,815) (7,602)
-------------- --------------
Total Dividends................................................................... (19,815) (7,602)
-------------- --------------
Total Dividends to shareholders................................................... (36,222,894) (28,764,872)
-------------- --------------
NET INCREASE (DECREASE) FROM SHARE TRANSACTIONS(1)..................................... 47,436,541 60,606,107
-------------- --------------
Net increase in net assets.......................................................... 85,217,186 47,973,964
-------------- --------------
NET ASSETS AT END OF THE PERIOD (INCLUDING LINE A)..................................... $ 423,356,265 $ 338,139,079
============== ==============
(A) Undistributed net investment income (loss)......................................... $ 432,214 $ 130,953
============== ==============
</TABLE>
---------------------------------------------------------------
(1) For detail on share transactions by series, see Statements of Changes in
Net Assets - Capital Stock Activity on pages 69-71.
(2) The Pan Asia Fund commenced operations on September 1, 2000.
(a) Initial investment in Retail A, Retail B and Trust Shares, which were first
issued on September 1, 2000.
SEE NOTES TO FINANCIAL STATEMENTS.
62
<PAGE>
<TABLE>
<CAPTION>
SMALL COMPANY EQUITY FUND
------------------------------------
YEARS ENDED
OCTOBER 31,
2000 1999
-------------- --------------
<S> <C> <C>
NET ASSETS AT BEGINNING OF THE PERIOD.................................................. $ 333,458,325 $ 331,071,417
-------------- --------------
INCREASE IN NET ASSETS RESULTING FROM OPERATIONS:
Net investment income (loss).......................................................... (3,899,942) (3,795,371)
Net realized gain (loss) on investments sold........................................ 120,456,546 (3,418,136)
Net realized (loss) on forward foreign currency contracts and foreign currency...... -- --
Net change in unrealized appreciation (depreciation) on investments,
foreign currency and forward foreign currency contracts........................... 56,876 56,108,824
-------------- --------------
Net increase (decrease) in net assets resulting from operations................... 116,613,480 48,895,317
-------------- --------------
DIVIDENDS TO SHAREHOLDERS FROM:
RETAIL A SHARES:
Net investment income .............................................................. -- --
Net realized gain on investments.................................................... -- --
-------------- --------------
Total Dividends................................................................... -- --
-------------- --------------
RETAIL B SHARES:
Net investment income .............................................................. -- --
Net realized gain on investments.................................................... -- --
-------------- --------------
Total Dividends................................................................... -- --
-------------- --------------
TRUST SHARES:
Net investment income .............................................................. -- --
Net realized gain on investments.................................................... -- --
-------------- --------------
Total Dividends................................................................... -- --
-------------- --------------
PRIME A SHARES:
Net investment income .............................................................. N/A N/A
Net realized gain on investments.................................................... N/A N/A
-------------- --------------
Total Dividends................................................................... N/A N/A
-------------- --------------
PRIME B SHARES:
Net investment income .............................................................. N/A N/A
Net realized gain on investments.................................................... N/A N/A
-------------- --------------
Total Dividends................................................................... N/A N/A
-------------- --------------
Total Dividends to shareholders................................................... -- --
-------------- --------------
NET INCREASE (DECREASE) FROM SHARE TRANSACTIONS(1)..................................... 116,870,468 (46,508,409)
-------------- --------------
Net increase in net assets.......................................................... 233,483,948 2,386,908
-------------- --------------
NET ASSETS AT END OF THE PERIOD (INCLUDING LINE A)..................................... $ 566,942,273 $ 333,458,325
============== ==============
(A) Undistributed net investment income (loss)......................................... $ (5,985) $ --
============== ==============
</TABLE>
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY FUND
------------------------------------
YEARS ENDED
OCTOBER 31,
2000 1999
-------------- --------------
<S> <C> <C>
NET ASSETS AT BEGINNING OF THE PERIOD.................................................. $ 593,762,099 $ 412,233,003
-------------- --------------
INCREASE IN NET ASSETS RESULTING FROM OPERATIONS:
Net investment income (loss).......................................................... 19,636,398 2,242,586
Net realized gain (loss) on investments sold........................................ 116,078,204 34,349,686
Net realized (loss) on forward foreign currency contracts and foreign currency...... (445,484) (4,120,655)
Net change in unrealized appreciation (depreciation) on investments,
foreign currency and forward foreign currency contracts........................... (205,754,102) 94,656,598
-------------- --------------
Net increase (decrease) in net assets resulting from operations................... (70,484,984) 127,128,215
-------------- --------------
DIVIDENDS TO SHAREHOLDERS FROM:
RETAIL A SHARES:
Net investment income .............................................................. (228,709) (216,041)
Net realized gain on investments.................................................... (5,152,046) (2,270,202)
-------------- --------------
Total Dividends................................................................... (5,380,755) (2,486,243)
-------------- --------------
RETAIL B SHARES:
Net investment income .............................................................. -- (1,893)
Net realized gain on investments.................................................... (197,787) (8,529)
-------------- --------------
Total Dividends................................................................... (197,787) (10,422)
-------------- --------------
TRUST SHARES:
Net investment income .............................................................. (4,007,069) (2,952,897)
Net realized gain on investments.................................................... (28,958,916) (11,473,155)
-------------- --------------
Total Dividends................................................................... (32,965,985) (14,426,052)
-------------- --------------
PRIME A SHARES:
Net investment income .............................................................. (72) (40)
Net realized gain on investments.................................................... (697) (145)
-------------- --------------
Total Dividends................................................................... (769) (185)
-------------- --------------
PRIME B SHARES:
Net investment income .............................................................. -- (226)
Net realized gain on investments.................................................... (26,392) (990)
-------------- --------------
Total Dividends................................................................... (26,392) (1,216)
-------------- --------------
Total Dividends to shareholders................................................... (38,571,688) (16,924,118)
-------------- --------------
NET INCREASE (DECREASE) FROM SHARE TRANSACTIONS(1)..................................... 582,801,366 71,324,999
-------------- --------------
Net increase in net assets.......................................................... 473,744,694 181,529,096
-------------- --------------
NET ASSETS AT END OF THE PERIOD (INCLUDING LINE A)..................................... $1,067,506,793 $ 593,762,099
============== ==============
(A) Undistributed net investment income (loss)......................................... $ 17,632,385 $ 3,972,887
============== ==============
</TABLE>
<TABLE>
<CAPTION>
PAN ASIA FUND
--------------------------
PERIOD ENDED
OCTOBER 31,
2000(2)
-------------
<S> <C>
NET ASSETS AT BEGINNING OF THE PERIOD.................................................. $ 30(a)
-------------
INCREASE IN NET ASSETS RESULTING FROM OPERATIONS:
Net investment income (loss).......................................................... 10,916
Net realized gain (loss) on investments sold........................................ 49,697
Net realized (loss) on forward foreign currency contracts and foreign currency...... (15,511)
Net change in unrealized appreciation (depreciation) on investments,
foreign currency and forward foreign currency contracts........................... (295,765)
-------------
Net increase (decrease) in net assets resulting from operations................... (250,663)
-------------
DIVIDENDS TO SHAREHOLDERS FROM:
RETAIL A SHARES:
Net investment income .............................................................. --
Net realized gain on investments.................................................... --
-------------
Total Dividends................................................................... --
-------------
RETAIL B SHARES:
Net investment income .............................................................. --
Net realized gain on investments.................................................... --
-------------
Total Dividends................................................................... --
-------------
TRUST SHARES:
Net investment income .............................................................. --
Net realized gain on investments.................................................... --
-------------
Total Dividends................................................................... --
-------------
PRIME A SHARES:
Net investment income .............................................................. --
Net realized gain on investments.................................................... --
-------------
Total Dividends................................................................... --
-------------
PRIME B SHARES:
Net investment income .............................................................. --
Net realized gain on investments.................................................... --
-------------
Total Dividends................................................................... --
-------------
Total Dividends to shareholders................................................... --
-------------
NET INCREASE (DECREASE) FROM SHARE TRANSACTIONS(1)..................................... 4,721,994
-------------
Net increase in net assets.......................................................... 4,471,331
-------------
NET ASSETS AT END OF THE PERIOD (INCLUDING LINE A)..................................... $ 4,471,361
=============
(A) Undistributed net investment income (loss)......................................... $ 2
=============
</TABLE>
63
<PAGE>
GALAXY EQUITY FUNDS
STATEMENTS OF CHANGES IN NET ASSETS --
CAPITAL STOCK ACTIVITY
<TABLE>
<CAPTION>
ASSET ALLOCATION FUND
----------------------------------------------------------------
YEARS ENDED OCTOBER 31,
2000 1999
------------------------------ ------------------------------
SHARES DOLLARS SHARES DOLLARS
-------------- ------------- -------------- ------------
<S> <C> <C> <C> <C>
Retail A Shares:
Sold........................................................... 2,579,720 $ 47,305,338 6,738,970 $ 118,271,361
Issued to shareholders in reinvestment of dividends............ 788,753 14,178,683 928,441 16,019,107
Repurchased.................................................... (5,522,579) (101,120,365) (4,817,875) (84,133,228)
-------------- ------------- -------------- -------------
Net increase (decrease) in shares outstanding.................. (2,154,106) $ (39,636,344) 2,849,536 $ 50,157,240
============== ============= ============== =============
Retail B Shares:
Sold........................................................... 1,301,411 $ 23,804,097 2,215,628 $ 39,055,990
Issued to shareholders in reinvestment of dividends............ 160,427 2,882,221 146,021 2,523,396
Repurchased.................................................... (961,193) (17,553,802) (629,222) (11,038,602)
-------------- ------------- -------------- -------------
Net increase (decrease) in shares outstanding.................. 500,645 $ 9,132,516 1,732,427 $ 30,540,784
============== ============= ============== =============
Trust Shares:
Sold........................................................... 3,014,706 $ 55,618,018 5,748,985 $ 102,114,779
Issued to shareholders in connection with acquisition (Note 9) 1,409,047 26,353,837 -- --
Issued to shareholders in reinvestment of dividends............ 557,331 10,035,589 613,319 10,601,826
Repurchased.................................................... (4,706,499) (86,042,433) (4,035,968) (71,793,820)
-------------- ------------- -------------- -------------
Net increase (decrease) in shares outstanding.................. 274,585 $ 5,965,011 2,326,336 $ 40,922,785
============== ============= ============== =============
Prime A Shares:
Sold........................................................... 1,711 $ 30,925 17,410 $ 303,889
Issued to shareholders in reinvestment of dividends............ 383 6,889 179 3,112
Repurchased.................................................... (5,591) (102,034) (4,177) (74,220)
-------------- ------------- -------------- -------------
Net increase (decrease) in shares outstanding.................. (3,497) $ (64,220) 13,412 $ 232,781
============== ============= ============== =============
Prime B Shares:
Sold........................................................... 1,933 $ 34,952 31,529 $ 550,948
Issued to shareholders in reinvestment of dividends............ 911 16,312 494 8,523
Repurchased.................................................... (4,119) (76,012) (2,695) (48,012)
-------------- ------------- -------------- -------------
Net increase (decrease) in shares outstanding.................. (1,275) $ (24,748) 29,328 $ 511,459
============== ============= ============== =============
BKB Shares:
Sold........................................................... 22,702 $ 433,727 N/A N/A
Issued to shareholders in connection with acquisition (Note 9). 1,429,361 26,733,768 N/A N/A
Issued to shareholders in reinvestment of dividends............ 7,547 145,799 N/A N/A
Repurchased.................................................... (200,113) (3,795,037) N/A N/A
-------------- ------------- -------------- -------------
Net increase in shares outstanding............................. 1,259,497 $ 23,518,257 N/A N/A
============== ============= ============== =============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
64
<PAGE>
<TABLE>
<CAPTION>
EQUITY INCOME FUND
---------------------------------------------------------------
YEARS ENDED OCTOBER 31,
2000 1999
------------------------------ ------------------------------
SHARES DOLLARS SHARES DOLLARS
-------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Retail A Shares:
Sold.......................................................... 958,360 $ 16,428,496 1,338,664 $ 26,175,419
Issued to shareholders in reinvestment of dividends........... 1,980,936 32,637,007 1,117,084 21,026,250
Repurchased................................................... (3,236,125) (55,051,171) (2,099,686) (41,266,164)
-------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding................. (296,829) $ (5,985,668) 356,062 $ 5,935,505
============== ============= ============= =============
Retail B Shares:
Sold.......................................................... 72,807 $ 1,238,538 173,216 $ 3,330,934
Issued to shareholders in reinvestment of dividends........... 32,655 529,408 1,006 18,467
Repurchased................................................... (45,524) (761,426) (7,328) (138,311)
-------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding................. 59,938 $ 1,006,520 166,894 $ 3,211,090
============== ============= ============= =============
Trust Shares:
Sold.......................................................... 625,334 $ 10,533,826 605,220 $ 11,824,496
Issued to shareholders in connection with acquisition (Note 9) -- -- -- --
Issued to shareholders in reinvestment of dividends........... 700,462 11,558,987 416,735 7,623,489
Repurchased................................................... (1,517,449) (25,673,834) (1,334,883) (25,937,232)
-------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding................. (191,653) $ (3,581,021) (312,928) $ (6,489,247)
============== ============= ============= =============
Prime A Shares:
Sold.......................................................... N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends........... N/A N/A N/A N/A
Repurchased................................................... N/A N/A N/A N/A
-------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding................. N/A N/A N/A N/A
============== ============= ============= =============
Prime B Shares:
Sold.......................................................... N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends........... N/A N/A N/A N/A
Repurchased................................................... N/A N/A N/A N/A
-------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding................. N/A N/A N/A N/A
============== ============= ============= =============
BKB Shares:
Sold.......................................................... N/A N/A N/A N/A
Issued to shareholders in connection with acquisition (Note 9) N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends........... N/A N/A N/A N/A
Repurchased................................................... N/A N/A N/A N/A
-------------- ------------- ------------- -------------
Net increase in shares outstanding............................ N/A N/A N/A N/A
============== ============= ============= =============
</TABLE>
<TABLE>
<CAPTION>
GROWTH AND INCOME FUND
---------------------------------------------------------------
YEARS ENDED OCTOBER 31,
2000 1999
------------------------------ ------------------------------
SHARES DOLLARS SHARES DOLLARS
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Retail A Shares:
Sold.......................................................... 1,887,797 $ 29,601,482 2,434,191 $ 39,277,116
Issued to shareholders in reinvestment of dividends........... 891,659 13,274,185 943,079 14,154,903
Repurchased................................................... (4,025,598) (63,550,391) (3,254,588) (52,667,374)
------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding................. (1,246,142) $ (20,674,724) 122,682 764,645
============= ============= ============= =============
Retail B Shares:
Sold.......................................................... 485,103 $ 7,617,109 640,709 $ 10,392,695
Issued to shareholders in reinvestment of dividends........... 236,117 3,489,755 213,284 3,188,793
Repurchased................................................... (830,683) (13,019,063) (519,908) (8,355,288)
------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding................. (109,463) $ (1,912,199) 334,085 $ 5,226,200
============= ============= ============= =============
Trust Shares:
Sold.......................................................... 7,697,859 $ 122,036,538 5,028,472 $ 82,183,977
Issued to shareholders in connection with acquisition (Note 9) 22,946,452 368,267,602 -- --
Issued to shareholders in reinvestment of dividends........... 1,156,996 17,303,773 1,023,222 16,323,263
Repurchased................................................... (9,807,884) (156,886,556 (3,807,714) (63,026,313)
------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding................. 21,993,423 $ 350,721,357 2,243,980 $ 35,480,927
============= ============= ============= =============
Prime A Shares:
Sold.......................................................... -- $ -- 9,535 $ 155,747
Issued to shareholders in reinvestment of dividends........... 430 6,425 341 5,154
Repurchased................................................... (323) (5,124) (484) (7,970)
------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding................. 107 $ 1,301 9,392 $ 152,931
============= ============= ============= =============
Prime B Shares:
Sold.......................................................... 490 $ 7,022 8,603 $ 138,816
Issued to shareholders in reinvestment of dividends........... 401 5,964 20 307
Repurchased................................................... (1,070) (17,146) (516) (8,311)
------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding................. (179) $ (4,160) 8,107 $ 130,812
============= ============= ============= =============
BKB Shares:
Sold.......................................................... 182,845 $ 2,830,470 N/A $ N/A
Issued to shareholders in connection with acquisition (Note 9) 9,313,418 149,471,040 N/A N/A
Issued to shareholders in reinvestment of dividends........... 5,213 87,579 N/A N/A
Repurchased................................................... (1,132,140) (18,369,658) N/A N/A
------------- ------------- ------------- -------------
Net increase in shares outstanding............................ 8,369,336 $ 134,019,431 N/A $ N/A
============= ============= ============= =============
</TABLE>
65
<PAGE>
GALAXY EQUITY FUNDS
STATEMENTS OF CHANGES IN NET ASSETS --
CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
STRATEGIC EQUITY FUND
------------------------------------------------------------------
YEARS ENDED OCTOBER 31,
2000 1999
------------------------------- -------------------------------
SHARES DOLLARS SHARES DOLLARS
-------------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
Retail A Shares:
Sold..................................................... 209,715 $ 1,981,206 521,862 $ 5,532,236
Issued to shareholders in reinvestment of dividends...... 111,720 943,323 2,248 26,010
Repurchased.............................................. (340,711) (3,193,212) (112,927) (1,186,925)
-------------- ------------- -------------- -------------
Net increase (decrease) in shares outstanding............ (19,276) $ (268,683) 411,183 $ 4,371,321
============== ============= ============== =============
Retail B Shares:
Sold..................................................... 51,391 $ 473,617 100,197 $ 1,083,391
Issued to shareholders in reinvestment of dividends...... 20,488 170,897 66 641
Repurchased.............................................. (58,914) (547,648) (23,924) (240,922)
-------------- ------------- -------------- -------------
Net increase in shares outstanding....................... 12,965 $ 96,866 76,339 $ 843,110
============== ============= ============== =============
Trust Shares:
Sold..................................................... 742,351 $ 7,218,111 621,301 $ 6,208,177
Issued to shareholders in reinvestment of dividends..... 1,104,158 9,332,817 56,785 602,374
Repurchased.............................................. (95,755) (859,157) (45,271) (499,231)
-------------- ------------- -------------- -------------
Net increase (decrease) in shares outstanding............ 1,750,754 $ 15,691,771 632,815 $ 6,311,320
============== ============= ============== =============
Prime A Shares:
Sold..................................................... N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends...... N/A N/A N/A N/A
Repurchased.............................................. N/A N/A N/A N/A
-------------- ------------- -------------- -------------
Net increase in shares outstanding....................... N/A N/A N/A N/A
============== ============= ============== =============
Prime B Shares:
Sold..................................................... N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends...... N/A N/A N/A N/A
Repurchased.............................................. N/A N/A N/A N/A
-------------- ------------- -------------- -------------
Net increase in shares outstanding....................... N/A N/A N/A N/A
============== ============= ============== =============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
66
<PAGE>
<TABLE>
<CAPTION>
EQUITY VALUE FUND
---------------------------------------------------------------
YEARS ENDED OCTOBER 31,
2000 1999
------------------------------ ------------------------------
SHARES DOLLARS SHARES DOLLARS
-------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Retail A Shares:
Sold..................................................... 1,728,851 $ 29,261,150 2,433,370 $ 45,762,951
Issued to shareholders in reinvestment of dividends...... 2,131,292 33,550,464 484,075 8,453,667
Repurchased.............................................. (4,689,038) (79,013,910) (3,013,975) (56,515,286)
-------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding............ (828,895) $ (16,202,296) (96,530) $ (2,298,668)
============== ============= ============= =============
Retail B Shares:
Sold..................................................... 268,449 $ 4,465,426 441,934 $ 8,314,738
Issued to shareholders in reinvestment of dividends...... 269,268 4,179,043 49,076 854,307
Repurchased.............................................. (424,451) (6,977,572) (182,489) (3,409,825)
-------------- ------------- ------------- -------------
Net increase in shares outstanding....................... 113,266 $ 1,666,897 308,521 $ 5,759,220
============== ============= ============= =============
Trust Shares:
Sold..................................................... 1,975,116 $ 33,480,334 3,627,023 $ 69,099,037
Issued to shareholders in reinvestment of dividends..... 2,000,279 31,632,032 431,433 7,684,111
Repurchased.............................................. (9,689,393) (160,334,269) (4,154,201) (77,396,395)
-------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding............ (5,713,998) $ (95,221,903) (95,745) $ (613,247)
============== ============= ============= =============
Prime A Shares:
Sold..................................................... N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends...... N/A N/A N/A N/A
Repurchased.............................................. N/A N/A N/A N/A
-------------- ------------- ------------- -------------
Net increase in shares outstanding....................... N/A N/A N/A N/A
============== ============= ============= =============
Prime B Shares:
Sold..................................................... N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends...... N/A N/A N/A N/A
Repurchased.............................................. N/A N/A N/A N/A
-------------- ------------- ------------- -------------
Net increase in shares outstanding....................... N/A N/A N/A N/A
============== ============= ============= =============
</TABLE>
<TABLE>
<CAPTION>
EQUITY GROWTH FUND
---------------------------------------------------------------
YEARS ENDED OCTOBER 31,
2000 1999
------------------------------ ------------------------------
SHARES DOLLARS SHARES DOLLARS
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Retail A Shares:
Sold..................................................... 7,519,256 $ 238,925,931 4,204,098 $ 114,977,854
Issued to shareholders in reinvestment of dividends...... 914,140 25,985,381 976,169 24,158,813
Repurchased.............................................. (5,773,778) (184,920,733) (2,662,892) (72,719,333)
------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding............ 2,659,618 $ 79,990,579 2,517,375 $ 66,417,334
============= ============= ============= =============
Retail B Shares:
Sold..................................................... 1,936,018 $ 59,549,719 1,291,210 $ 34,935,971
Issued to shareholders in reinvestment of dividends...... 162,849 4,504,837 112,861 2,738,197
Repurchased.............................................. (454,523) (13,961,559) (315,473) (8,517,659)
------------- ------------- ------------- -------------
Net increase in shares outstanding....................... 1,644,344 $ 50,092,997 1,088,598 $ 29,156,509
============= ============= ============= =============
Trust Shares:
Sold..................................................... 8,460,181 $ 270,618,606 6,246,300 $ 174,347,614
Issued to shareholders in reinvestment of dividends..... 1,820,461 52,108,813 2,140,810 53,167,673
Repurchased.............................................. (7,417,380) (236,242,243) (5,924,861) (162,227,177)
------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding............ 2,863,262 $ 86,485,176 2,462,249 $ 65,288,110
============= ============= ============= =============
Prime A Shares:
Sold..................................................... 527 $ 16,915 3,655 $ 99,300
Issued to shareholders in reinvestment of dividends...... 221 6,282 73 1,711
Repurchased.............................................. (25) (747) (46) (1,323)
------------- ------------- ------------- -------------
Net increase in shares outstanding....................... 723 $ 22,450 3,682 $ 99,688
============= ============= ============= =============
Prime B Shares:
Sold..................................................... 5,310 $ 156,601 8,512 $ 233,056
Issued to shareholders in reinvestment of dividends...... 453 12,809 21 528
Repurchased.............................................. (220) (6,656) -- --
------------- ------------- ------------- -------------
Net increase in shares outstanding....................... 5,543 $ 162,754 8,533 $ 233,584
============= ============= ============= =============
</TABLE>
67
<PAGE>
GALAXY EQUITY FUNDS
STATEMENTS OF CHANGES IN NET ASSETS --
CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
GROWTH FUND II
-----------------------------------------------------------------------------
PERIOD ENDED OCTOBER 31, YEARS ENDED MAY 31,
2000(1) 2000 1999
------------------------- ----------------------- ------------------------
SHARES DOLLARS SHARES DOLLARS SHARES DOLLARS
----------- ----------- ----------- ------------ ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
Retail A Shares:
Sold............................................... 2,821,837 $ 40,189,135 N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends -- -- N/A N/A N/A N/A
Repurchased........................................ (2,710,273) (38,892,355) N/A N/A N/A N/A
----------- ------------ ----------- ------------ ----------- ------------
Net increase (decrease) in shares outstanding...... 111,564 $ 1,296,780 N/A N/A N/A N/A
=========== ============ =========== ============ =========== ============
Retail B Shares:
Sold............................................... 48,182 $ 691,110 N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends -- -- N/A N/A N/A N/A
Repurchased........................................ (1,323) (19,223) N/A N/A N/A N/A
----------- ------------ ----------- ------------ ----------- ------------
Net increase (decrease) in shares outstanding...... 46,859 $ 671,887 N/A N/A N/A N/A
=========== ============ =========== ============ =========== ============
Shares**:
Sold............................................... 1,475,575 $ 19,500,013 14,007,000 $212,676,000 16,196,000 $181,224,000
Issued to shareholders in reinvestment of dividends -- -- 4,642,000 68,726,000 417,000 4,590,000
Repurchased........................................ (1,890,092) (25,475,844) (19,458,000)(296,477,000)*(21,152,000)(240,206,000)
----------- ------------ ----------- ------------ ----------- ------------
Net increase (decrease) in shares outstanding...... (414,517) $ (5,975,831) (809,000)$(15,075,000) (4,539,000)$(54,392,000)
=========== ============ =========== ============ =========== ============
Trust Shares:
Sold............................................... 396,131 $ 5,660,929 N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends -- -- N/A N/A N/A N/A
Repurchased........................................ (3,780,091) (56,116,909) N/A N/A N/A N/A
----------- ------------ ----------- ------------ ----------- ------------
Net increase (decrease) in shares outstanding...... (3,383,960) $(50,455,980) N/A N/A N/A N/A
=========== ============ =========== ============ =========== ============
Prime A Shares:
Sold............................................... N/A N/A N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends N/A N/A N/A N/A N/A N/A
Repurchased........................................ N/A N/A N/A N/A N/A N/A
----------- ------------ ----------- ------------ ----------- ------------
Net increase (decrease) in shares outstanding...... N/A N/A N/A N/A N/A N/A
=========== ============ =========== ============ =========== ============
Prime B Shares:
Sold............................................... N/A N/A N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends N/A N/A N/A N/A N/A N/A
Repurchased........................................ N/A N/A N/A N/A N/A N/A
----------- ------------ ----------- ------------ ----------- ------------
Net increase (decrease) in shares outstanding...... N/A N/A N/A N/A N/A N/A
=========== ============ =========== ============ =========== ============
BKB Shares:
Sold............................................... 518,736 $ 7,855,781 N/A N/A N/A N/A
Repurchased........................................ (750,483) (11,258,360) N/A N/A N/A N/A
----------- ------------ ----------- ------------ ----------- ------------
Net (decrease) in shares outstanding............... (231,747) $ (3,402,579) N/A N/A N/A N/A
=========== ============ =========== ============ =========== ============
</TABLE>
---------------------------------------------------------------------
* Includes redemptions of $69,327,239 as a result of the redemption in kind
on April 10, 2000.
** Prior to June 26, 2000, the Growth Fund IIoffered only one series of
shares, which are included in these balances (See Note 9).
(1) For the period June 1, 2000 through October 31, 2000.
SEE NOTES TO FINANCIAL STATEMENTS.
68
<PAGE>
<TABLE>
<CAPTION>
SMALL CAP VALUE FUND
---------------------------------------------------------------
YEARS ENDED OCTOBER 31,
2000 1999
------------------------------ ------------------------------
SHARES DOLLARS SHARES DOLLARS
-------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Retail A Shares:
Sold............................................... 2,092,115 $ 28,746,130 1,438,795 $ 19,008,974
Issued to shareholders in reinvestment of dividends 668,257 8,255,796 648,595 8,277,731
Repurchased........................................ (2,852,488) (38,935,986) (2,345,235) (30,861,975)
-------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding...... (92,116) (1,934,060) (257,845) $ (3,575,270)
============== ============= ============= =============
Retail B Shares:
Sold............................................... 85,930 $ 1,149,205 132,583 $ 1,771,843
Issued to shareholders in reinvestment of dividends 15,748 194,023 487 6,178
Repurchased........................................ (27,049) (361,874) (6,809) (87,689)
-------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding...... 74,629 $ 981,354 126,261 $ 1,690,332
============== ============= ============= =============
Shares**:
Sold............................................... N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends N/A N/A N/A N/A
Repurchased........................................ N/A N/A N/A N/A
-------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding...... N/A N/A N/A N/A
============== ============= ============= =============
Trust Shares:
Sold............................................... 7,216,851 $ 99,197,730 8,188,452 $ 109,425,380
Issued to shareholders in reinvestment of dividends 1,730,729 21,586,955 1,235,136 15,839,896
Repurchased........................................ (5,331,805) (72,356,709) (4,764,801) (63,150,650)
-------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding...... 3,615,775 $ 48,427,976 4,658,787 $ 62,114,626
============== ============= ============= =============
Prime A Shares:
Sold............................................... 186 $ 2,363 15,569 $ 208,140
Issued to shareholders in reinvestment of dividends 1,314 16,348 153 1,965
Repurchased........................................ (1,708) (22,568) (2,335) (31,567)
-------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding...... (208) (3,857) 13,387 $ 178,538
============== ============= ============= =============
Prime B Shares:
Sold............................................... 1,844 $ 25,456 15,302 $ 207,595
Issued to shareholders in reinvestment of dividends 1,605 19,815 594 7,596
Repurchased........................................ (6,099) (80,143) (1,298) (17,310)
-------------- ------------- ------------- -------------
Net increase (decrease) in shares outstanding...... (2,650) $ (34,872) 14,598 $ 197,881
============== ============= ============= =============
BKB Shares:
Sold............................................... N/A N/A N/A N/A
Repurchased........................................ N/A N/A N/A N/A
-------------- ------------- ------------- -------------
Net (decrease) in shares outstanding............... N/A N/A N/A N/A
============== ============= ============= =============
</TABLE>
<TABLE>
<CAPTION>
SMALL COMPANY EQUITY FUND
--------------------------------------------------------------
YEARS ENDED OCTOBER 31,
2000 1999
------------------------------ -----------------------------
SHARES DOLLARS SHARES DOLLARS
------------ ------------- ------------ -------------
<S> <C> <C> <C> <C>
Retail A Shares:
Sold............................................... 28,229,809 $ 656,174,397 22,169,167 $ 325,325,171
Issued to shareholders in reinvestment of dividends -- -- -- --
Repurchased........................................ (28,076,741) (653,452,707) (23,587,237) (347,667,128)
------------ ------------- ------------ -------------
Net increase (decrease) in shares outstanding...... 153,068 $ 2,721,690 (1,418,070) $ (22,341,957)
============ ============= ============ =============
Retail B Shares:
Sold............................................... 1,051,953 $ 21,391,880 2,388,029 $ 34,581,558
Issued to shareholders in reinvestment of dividends -- -- -- --
Repurchased........................................ (952,162) (18,637,553) (2,528,697) (36,619,640)
------------ ------------- ------------ -------------
Net increase (decrease) in shares outstanding...... 99,791 $ 2,754,327 (140,668) $ (2,038,082)
============ ============= ============ =============
Shares**:
Sold............................................... N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends N/A N/A N/A N/A
Repurchased........................................ N/A N/A N/A N/A
------------ ------------- ------------ -------------
Net increase (decrease) in shares outstanding...... N/A N/A N/A N/A
============ ============= ============ =============
Trust Shares:
Sold............................................... 14,169,687 $ 349,860,617 13,075,068 $ 197,458,863
Issued to shareholders in reinvestment of dividends -- -- -- --
Repurchased........................................ (9,835,449) (238,466,166) (14,555,648) (219,587,233)
------------ ------------- ------------ -------------
Net increase (decrease) in shares outstanding...... 4,334,238 $ 111,394,451 (1,480,580) $ (22,128,370)
============ ============= ============ =============
Prime A Shares:
Sold............................................... N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends N/A N/A N/A N/A
Repurchased........................................ N/A N/A N/A N/A
------------ ------------- ------------ -------------
Net increase (decrease) in shares outstanding...... N/A N/A N/A N/A
============ ============= ============ =============
Prime B Shares:
Sold............................................... N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends N/A N/A N/A N/A
Repurchased........................................ N/A N/A N/A N/A
------------ ------------- ------------ -------------
Net increase (decrease) in shares outstanding...... N/A N/A N/A N/A
============ ============= ============ =============
BKB Shares:
Sold............................................... N/A N/A N/A N/A
Repurchased........................................ N/A N/A N/A N/A
------------ ------------- ------------ -------------
Net (decrease) in shares outstanding............... N/A N/A N/A N/A
============ ============= ============ =============
</TABLE>
69
<PAGE>
GALAXY EQUITY FUNDS
STATEMENTS OF CHANGES IN NET ASSETS --
CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY FUND
------------------------------------------------------------------
YEARS ENDED OCTOBER 31,
2000 1999
------------------------------- -------------------------------
SHARES DOLLARS SHARES DOLLARS
-------------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
Retail A Shares:
Sold..................................................... 16,313,471 $ 356,102,622 3,393,407 $ 63,996,029
Issued to shareholders in reinvestment of dividends...... 241,653 5,261,364 142,822 2,371,667
Repurchased.............................................. (14,646,857) (322,790,275) (3,226,391) (60,811,773)
-------------- ------------- -------------- -------------
Net increase in shares outstanding....................... 1,908,267 $ 38,573,711 309,838 $ 5,555,923
============== ============= ============== =============
Retail B Shares:
Sold..................................................... 839,324 $ 18,559,240 2,792,826 $ 52,822,549
Issued to shareholders in reinvestment of dividends...... 5,380 117,762 73 1,254
Repurchased.............................................. (519,670) (11,280,032) (2,687,674) (51,002,543)
-------------- ------------- -------------- -------------
Net increase in shares outstanding....................... 325,034 $ 7,396,970 105,225 $ 1,821,260
============== ============= ============== =============
Trust Shares:
Sold..................................................... 33,253,547 $ 736,562,680 17,587,176 $ 339,364,891
Issued in connection with acquisition (Note 9)........... 16,286,179 367,482,963 -- --
Issued to shareholders in reinvestment of dividends...... 872,560 19,308,786 484,004 8,378,059
Repurchased.............................................. (27,871,760) (615,328,984) (14,718,280) (284,220,019)
-------------- ------------- -------------- -------------
Net increase in shares outstanding....................... 22,540,526 $ 508,025,445 3,352,900 $ 63,522,931
============== ============= ============== =============
Prime A Shares:
Sold..................................................... 108 $ 2,364 815 $ 14,519
Issued to shareholders in reinvestment of dividends...... 35 768 33 566
Repurchased.............................................. -- -- (264) (4,960)
-------------- ------------- -------------- -------------
Net increase in shares outstanding....................... 143 $ 3,132 584 $ 10,125
============== ============= ============== =============
Prime B Shares:
Sold..................................................... 3,578 $ 79,415 22,188 $ 418,549
Issued to shareholders in reinvestment of dividends...... 221 4,796 71 1,217
Repurchased.............................................. (818) (18,499) (273) (5,006)
-------------- ------------- -------------- -------------
Net increase in shares outstanding....................... 2,981 $ 65,712 21,986 $ 414,760
============== ============= ============== =============
BKB Shares:
Sold..................................................... 3,560,477 $ 73,928,132 N/A $ N/A
Issued in connection with acquisition (Note 9)........... 1,192,870 26,916,037 N/A N/A
Repurchased.............................................. (3,444,499) (72,107,773) N/A N/A
-------------- ------------- -------------- -------------
Net increase in shares outstanding....................... 1,308,848 $ 28,736,396 N/A $ N/A
============== ============= ============== =============
</TABLE>
---------------------------------------------------
* The Pan Asia Fund commenced operations on September 1, 2000.
SEE NOTES TO FINANCIAL STATEMENTS.
70
<PAGE>
<TABLE>
<CAPTION>
PAN ASIA FUND
------------------------------
PERIOD ENDED OCTOBER 31,
2000*
------------------------------
SHARES DOLLARS
-------------- -------------
<S> <C> <C>
Retail A Shares:
Sold..................................................... 21,471 $ 203,357
Issued to shareholders in reinvestment of dividends...... -- --
Repurchased.............................................. (186) (1,776)
-------------- -------------
Net increase in shares outstanding....................... 21,285 $ 201,581
============== =============
Retail B Shares:
Sold..................................................... 2,229 $ 21,840
Issued to shareholders in reinvestment of dividends...... -- --
Repurchased.............................................. (151) (1,446)
-------------- -------------
Net increase in shares outstanding....................... 2,078 $ 20,394
============== =============
Trust Shares:
Sold..................................................... 449,501 $ 4,494,999
Issued in connection with acquisition (Note 9)........... -- --
Issued to shareholders in reinvestment of dividends...... -- --
Repurchased.............................................. -- --
-------------- -------------
Net increase in shares outstanding....................... 449,501 $ 4,494,999
============== =============
Prime A Shares:
Sold..................................................... 257 $ 2,510
Issued to shareholders in reinvestment of dividends...... -- --
Repurchased.............................................. -- --
-------------- -------------
Net increase in shares outstanding....................... 257 $ 2,510
============== =============
Prime B Shares:
Sold..................................................... 257 $ 2,510
Issued to shareholders in reinvestment of dividends...... -- --
Repurchased.............................................. -- --
-------------- -------------
Net increase in shares outstanding....................... 257 $ 2,510
============== =============
BKB Shares:
Sold..................................................... N/A N/A
Issued in connection with acquisition (Note 9)........... N/A N/A
Repurchased.............................................. N/A N/A
-------------- -------------
Net increase in shares outstanding....................... N/A N/A
============== =============
</TABLE>
71
<PAGE>
ASSET ALLOCATION FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
----------------------------------------- -------------------------------------------
NET NET
NET REALIZED AND DIVIDENDS DISTRIBUTIONS INCREASE
ASSET VALUE, NET UNREALIZED TOTAL FROM FROM NET FROM (DECREASE)
BEGINNING INVESTMENT GAIN (LOSS) ON INVESTMENT INVESTMENT NET REALIZED TOTAL IN NET
OF PERIOD INCOME(B) INVESTMENTS OPERATIONS INCOME CAPITAL GAINS DISTRIBUTIONS ASSET VALUE
------------ ----------- -------------- ----------- ----------- -------------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00 $ 17.74 $ 0.37(2) $ 1.36 $ 1.73 $ (0.37) $ (0.31) $ (0.68) $ 1.05
10/31/99 16.95 0.37 1.21 1.58 (0.36) (0.43) (0.79) 0.79
10/31/98 16.46 0.38 1.72 2.10 (0.40) (1.21) (1.61) 0.49
10/31/97 14.52 0.40 2.43 2.83 (0.38) (0.51) (0.89) 1.94
10/31/96 12.82 0.30 1.83 2.13 (0.30) (0.13) (0.43) 1.70
RETAIL B
10/31/00 17.70 0.24(2) 1.36 1.60 (0.25) (0.31) (0.56) 1.04
10/31/99 16.92 0.25 1.21 1.46 (0.25) (0.43) (0.68) 0.78
10/31/98 16.43 0.29 1.71 2.00 (0.30) (1.21) (1.51) 0.49
10/31/97 14.51 0.29 2.42 2.71 (0.28) (0.51) (0.79) 1.92
10/31/96(1) 13.59 0.13 0.91 1.04 (0.12) -- (0.12) 0.92
TRUST
10/31/00 17.73 0.41(2) 1.36 1.77 (0.41) (0.31) (0.72) 1.05
10/31/99 16.96 0.40 1.20 1.60 (0.40) (0.43) (0.83) 0.77
10/31/98 16.47 0.42 1.71 2.13 (0.43) (1.21) (1.64) 0.49
10/31/97 14.53 0.43 2.42 2.85 (0.40) (0.51) (0.91) 1.94
10/31/96 12.83 0.33 1.83 2.16 (0.33) (0.13) (0.46) 1.70
PRIME A
10/31/00 17.73 0.39(2) 1.36 1.75 (0.40) (0.31) (0.71) 1.04
10/31/99(1) 16.95 0.44 1.17 1.61 (0.40) (0.43) (0.83) 0.78
PRIME B
10/31/00 17.71 0.26(2) 1.35 1.61 (0.26) (0.31) (0.57) 1.04
10/31/99(1) 16.95 0.29 1.19 1.48 (0.29) (0.43) (0.72) 0.76
BKB
10/31/00(1) 18.70 0.17(2) 0.01 0.18 (0.11) -- (0.11) 0.07
----------------------------------------------
<FN>
* Annualized.
** Not Annualized.
(1) The Fund began issuing Retail B Shares on March 4, 1996, Prime A and Prime B Shares on November 1, 1998 and BKBShares on June
19, 2000.
(2) The selected per share data was calculated using the weighted average shares outstanding method for the period.
(A) Calculation does not include the effect of any sales charge for Retail A Shares, Retail B Shares, Prime A Shares and Prime B
Shares.
(B) Net investment income per share before reimbursement/waiver of fees by the Investment Advisor and/or affiliates and/or
Administrator for Retail A Shares for the years ended October 31, 2000, 1999, 1998, 1997 and 1996 were $0.37(2), $0.37, $0.38,
$0.40 and $0.30, respectively. Net investment income per share before reimbursement/waiver of fees by the Investment Advisor
and/or affiliates and/or Administrator for Retail B Shares for the years ended October 31, 2000, 1999, 1998 and 1997 and the
period ended October 31, 1996 were $0.24(2), $0.25, $0.29, $0.28 and $0.12, respectively. Net investment income per share
before reimbursement/waiver of fees by the Investment Advisor and/or affiliates and/or Administrator for Trust Shares for the
years ended October 31, 2000, 1999, 1998, 1997 and 1996 were $0.41(2), $0.40, $0.42, $0.43 and $0.33, respectively. Net
investment income per share before reimbursement/waiver of fees by the Investment Advisor and/or affiliates and/or
Administrator for Prime A Shares for the years ended October 31, 2000 and 1999 were $0.37(2) and $0.41, respectively. Net
investment income per share before reimbursement/waiver of fees by the Investment Advisor and/or affiliates and/or
Administrator for Prime B Shares for the years ended October 31, 2000 and 1999 were $0.23(2) and $0.26, respectively. Net
investment income per share before reimbursement/waiver of fees by the Investment Advisor and/or affiliates and/or
Administrator for BKB Shares for the period ended October 31, 2000 was $0.16(2).
</FN>
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
72
<PAGE>
<TABLE>
<CAPTION>
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------
RATIO OF NET RATIO OF RATIO OF
INVESTMENT OPERATING OPERATING
INCOME EXPENSES EXPENSES
NET ASSETS, INCLUDING INCLUDING EXCLUDING
NET ASSET VALUE, END OF PERIOD REIMBURSEMENT/ REIMBURSEMENT/ REIMBURSEMENT/ PORTFOLIO
END OF PERIOD TOTAL RETURN(A) (IN 000'S) WAIVER WAIVER WAIVER TURNOVER RATE
--------------- -------------- ------------- ---------------- -------------- ---------------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00 $ 18.79 9.98% $ 371,590 2.01% 1.29% 1.29% 59%
10/31/99 17.74 9.53% 389,077 2.11% 1.32% 1.32% 135%
10/31/98 16.95 13.85% 323,498 2.43% 1.33% 1.33% 108%
10/31/97 16.46 20.23% 177,239 2.66% 1.37% 1.37% 58%
10/31/96 14.52 16.92% 116,852 2.29% 1.42% 1.42% 48%
RETAIL B
10/31/00 18.74 9.20% 105,980 1.31% 1.99% 1.99% 59%
10/31/99 17.70 8.76% 91,199 1.43% 2.00% 2.00% 135%
10/31/98 16.92 13.14% 57,876 1.77% 1.99% 1.99% 108%
10/31/97 16.43 19.34% 30,688 1.95% 2.10% 2.19% 58%
10/31/96(1) 14.51 7.71%** 3,557 1.73%* 1.95%* 2.15%* 48%
TRUST
10/31/00 18.78 10.21% 290,970 2.21% 1.09% 1.09% 59%
10/31/99 17.73 9.63% 269,851 2.31% 1.12% 1.12% 135%
10/31/98 16.96 14.05% 218,666 2.63% 1.13% 1.13% 108%
10/31/97 16.47 20.42% 171,741 2.82% 1.21% 1.22% 58%
10/31/96 14.53 17.19% 123,603 2.52% 1.19% 1.21% 48%
PRIME A
10/31/00 18.77 10.15% 186 2.15% 1.15% 1.30% 59%
10/31/99(1) 17.73 9.72% 238 2.27% 1.16% 1.29% 135%
PRIME B
10/31/00 18.75 9.29% 526 1.41% 1.89% 2.06% 59%
10/31/99(1) 17.71 8.91% 519 1.53% 1.90% 2.08% 135%
BKB
10/31/00(1) 18.77 0.96%** 23,642 2.33%* 0.97%* 1.10%* 59%
</TABLE>
73
<PAGE>
EQUITY INCOME FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
------------------------------------- --------------------------------------
NET
NET REALIZED AND DIVIDENDS DISTRIBUTIONS NET
ASSET VALUE, NET UNREALIZED TOTAL FROM FROM NET FROM INCREASE(DECREASE)
BEGINNING INVESTMENT GAIN (LOSS) ON INVESTMENT INVESTMENT NET REALIZED TOTAL IN NET
OF PERIOD INCOME(B) INVESTMENTS OPERATIONS INCOME CAPITAL GAINS DISTRIBUTIONS ASSET VALUE
------------ ----------- -------------- ----------- ----------- -------------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00 $ 19.50 $ 0.16(2) $ 1.22 $ 1.38 $ (0.16) $ (2.95) $ (3.11) $ (1.73)
10/31/99 19.67 0.19 1.69 1.88 (0.20) (1.85) (2.05) (0.17)
10/31/98 18.82 0.25 2.43 2.68 (0.25) (1.58) (1.83) 0.85
10/31/97 16.91 0.30 3.35 3.65 (0.30) (1.44) (1.74) 1.91
10/31/96 14.98 0.30 2.47 2.77 (0.30) (0.54) (0.84) 1.93
RETAIL B
10/31/00 19.25 0.03(2) 1.21 1.24 (0.04) (2.95) (2.99) (1.75)
10/31/99(1) 19.48 0.11 1.62 1.73 (0.11) (1.85) (1.96) (0.23)
TRUST
10/31/00 19.52 0.23(2) 1.22 1.45 (0.22) (2.95) (3.17) (1.72)
10/31/99 19.69 0.28 1.69 1.97 (0.29) (1.85) (2.14) (0.17)
10/31/98 18.84 0.34 2.42 2.76 (0.33) (1.58) (1.91) 0.85
10/31/97 16.93 0.38 3.35 3.73 (0.38) (1.44) (1.82) 1.91
10/31/96 14.99 0.37 2.48 2.85 (0.37) (0.54) (0.91) 1.94
-------------------------------------------------------
(1) The Fund began issuing Retail B Shares on November 1, 1998.
(2) The selected per share data was calculated using the weighted average
shares outstanding method for the period.
(A) Calculation does not include the effect of any sales charge for Retail A
Shares and Retail B Shares.
(B) Net investment income per share before reimbursement/waiver of fees by the
Investment Advisor and/or affiliates and/or Administrator for Retail A
Shares for the years ended October 31, 2000, 1999, 1998, 1997 and 1996 were
$0.16(2), $0.19, $0.25, $0.30 and $0.30, respectively. Net investment
income per share before reimbursement/waiver of fees by the Investment
Advisor and/or affiliates and/or Administrator for Retail B Shares for the
years ended October 31, 2000 and 1999 were $0.03(2) and $0.08,
respectively. Net investment income per share before reimbursement/waiver
of fees by the Investment Advisor and/or affiliates and/or Administrator
for Trust Shares for the years ended October 31, 2000, 1999, 1998, 1997 and
1996 were $0.23(2), $0.28, $0.34, $0.38 and $0.37, respectively.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
74
<PAGE>
<TABLE>
<CAPTION>
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------
RATIO OF NET RATIO OF RATIO OF
INVESTMENT OPERATING OPERATING
INCOME EXPENSES EXPENSES
NET ASSETS, INCLUDING INCLUDING EXCLUDING
NET ASSET VALUE, END OF PERIOD REIMBURSEMENT/ REIMBURSEMENT/ REIMBURSEMENT/ PORTFOLIO
END OF PERIOD TOTAL RETURN(A) (IN 000'S) WAIVER WAIVER WAIVER TURNOVER RATE
--------------- -------------- ------------- ---------------- -------------- ---------------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00 $ 17.77 8.45% $ 188,847 0.91% 1.33% 1.33% 51%
10/31/99 19.50 10.14% 213,041 0.97% 1.33% 1.33% 38%
10/31/98 19.67 15.23% 207,850 1.30% 1.34% 1.34% 46%
10/31/97 18.82 23.28% 169,276 1.70% 1.39% 1.41% 37%
10/31/96 16.91 19.01% 126,952 1.86% 1.40% 1.40% 45%
RETAIL B
10/31/00 17.50 7.71% 3,969 0.19% 2.04% 2.08% 51%
10/31/99(1) 19.25 9.38% 3,213 0.33% 1.97% 2.23% 38%
TRUST
10/31/00 17.80 8.94% 106,148 1.32% 0.91% 0.91% 51%
10/31/99 19.52 10.60% 120,179 1.39% 0.91% 0.91% 38%
10/31/98 19.69 15.67% 127,367 1.72% 0.92% 0.92% 46%
10/31/97 18.84 23.80% 119,505 2.14% 0.95% 0.97% 37%
10/31/96 16.93 19.65% 106,094 2.32% 0.94% 0.94% 45%
</TABLE>
75
<PAGE>
GROWTH AND INCOME FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
------------------------------------- ---------------------------------------------------------
NET
NET REALIZED AND DIVIDENDS DIVIDENDS DISTRIBUTIONS
ASSET VALUE, NET UNREALIZED TOTAL FROM FROM NET EXCESS OF NET FROM
BEGINNING INVESTMENT GAIN ON INVESTMENT INVESTMENT INVESTMENT NET REALIZED TOTAL
OF PERIOD INCOME(B) INVESTMENTS OPERATIONS INCOME INCOME CAPITAL GAINS DISTRIBUTIONS
------------ ----------- -------------- ----------- ----------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00 $ 15.98 $ 0.02 $ 1.33 $ 1.35 $ (0.05) $ --(3) $ (0.91) $ (0.96)
10/31/99 14.87 0.08(4) 2.02 2.10 (0.08) -- (0.91) (0.99)
10/31/98 16.24 0.12 1.32 1.44 (0.13) -- (2.68) (2.81)
10/31/97 13.78 0.18 3.67 3.85 (0.20) -- (1.19) (1.39)
10/31/96(1) 12.35 0.21 2.16 2.37 (0.21) -- (0.73) (0.94)
RETAIL B
10/31/00 15.90 (0.10) 1.34 1.24 -- -- (0.91) (0.91)
10/31/99 14.83 (0.04)(4) 2.02 1.98 -- -- (0.91) (0.91)
10/31/98 16.23 --(3) 1.31 1.31 (0.03) -- (2.68) (2.71)
10/31/97 13.77 0.10 3.65 3.75 (0.10) -- (1.19) (1.29)
10/31/96(2) 12.97 0.07 0.81 0.88 (0.08) -- -- (0.08)
TRUST
10/31/00 16.02 0.08 1.32 1.40 (0.08) --(3) (0.91) (0.99)
10/31/99 14.90 0.13(4) 2.02 2.15 (0.12) -- (0.91) (1.03)
10/31/98 16.28 0.15 1.31 1.46 (0.16) -- (2.68) (2.84)
10/31/97 13.80 0.22 3.68 3.90 (0.23) -- (1.19) (1.42)
10/31/96(1) 12.35 0.27 2.16 2.43 (0.25) -- (0.73) (0.98)
PRIME A
10/31/00 16.00 0.04 1.34 1.38 (0.06) -- (0.91) (0.97)
10/31/99(2) 14.88 0.11(4) 2.03 2.14 (0.11) -- (0.91) (1.02)
PRIME B
10/31/00 15.97 (0.07) 1.33 1.26 -- -- (0.91) (0.91)
10/31/99(2) 14.88 (0.01)(4) 2.03 2.02 (0.02) -- -- (0.93)
BKB
10/31/00(2) 16.05 0.03 0.36 0.39 (0.01) --(3) -- (0.01)
</TABLE>
NET
INCREASE
(DECREASE)
IN NET
ASSET VALUE
-----------
RETAIL A
10/31/00 $ 0.39
10/31/99 1.11
10/31/98 (1.37)
10/31/97 2.46
10/31/96(1) 1.43
RETAIL B
10/31/00 0.33
10/31/99 1.07
10/31/98 (1.40)
10/31/97 2.46
10/31/96(2) 0.80
TRUST
10/31/00 0.41
10/31/99 1.12
10/31/98 (1.38)
10/31/97 2.48
10/31/96(1) 1.45
PRIME A
10/31/00 0.41
10/31/99(2) 1.12
PRIME B
10/31/00 0.35
10/31/99(2) 1.09
BKB
10/31/00(2) 0.38
--------------------------------------------------------
* Annualized
** Not Annualized
(1) The Fund commenced operations on December 14, 1992 as a separate investment
portfolio (the "Predecessor Fund") of The Shawmut Funds. On December 4,
1995, the Predecessor Fund was reorganized as a new portfolio of the Trust.
Prior to the reorganization, the Predecessor Fund offered and sold two
series of shares, Investment Shares and Trust Shares, that were similar to
the Fund's Retail A Shares and Trust Shares, respectively. In connection
with the reorganization, shareholders of the Predecessor Fund exchanged
Investment Shares and Trust Shares for Retail A Shares and Trust Shares,
respectively, in the Galaxy Growth and Income Fund.
(2) The Fund began issuing Retail B Shares on March 4, 1996, Prime A and Prime
B Shares on November 1, 1998 and BKB Shares on June 19, 2000.
(3) Net investment income per share and dividends in excess of net investment
income per share were less than $0.005.
(4) The selected per share data was calculated using the weighted average
shares outstanding method for the period.
(A) Calculation does not include the effect of any sales charge for Retail A
Shares, Retail B Shares, Prime A Shares and Prime B Shares.
(B) Net investment income per share before reimbursement/waiver of fees by the
Investment Advisor and/or affiliates and/or Administrator for Retail A
Shares for the years ended October 31, 2000, 1999, 1998, 1997 and 1996 were
$0.01, $0.07, $0.10, $0.18 and $0.19, respectively. Net investment income
(loss) per share before reimbursement/waiver of fees by the Investment
Advisor and/or affiliates and/or Administrator for Retail B Shares for the
years ended October 31, 2000, 1999, 1998 and 1997 and the period ended
October 31, 1996 were $(0.10), $(0.04), $0.00, $0.08 and $0.05,
respectively. Net investment income per share before reimbursement/waiver
of fees by the Investment Advisor and/or affiliates and/or Administrator
for Trust Shares for the years ended October 31, 2000, 1999, 1998, 1997 and
1996 were $0.08, $0.13, $0.15, $0.21, and $0.27, respectively. Net
investment income per share before reimbursement/waiver of fees by the
Investment Advisor and/or affiliates and/or Administrator for Prime A
Shares for the years ended October 31, 2000 and 1999 were $0.03 and $0.09,
respectively. Net investment (loss) per share before reimbursement/waiver
of fees by the Investment Advisor and/or affiliates and/or Administrator
for Prime B Shares for the years ended October 31, 2000 and 1999 were
$(0.10) and $(0.05), respectively. Net investment income per share before
reimbursement/waiver of fees by the Investment Advisor and/or affiliates
and/or Administrator for BKB Shares for the period ended October 31, 2000
was $0.02.
SEE NOTES TO FINANCIAL STATEMENTS.
76
<PAGE>
<TABLE>
<CAPTION>
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------
RATIO OF NET RATIO OF RATIO OF
INVESTMENT OPERATING OPERATING
INCOME (LOSS EXPENSES EXPENSES
NET ASSETS, INCLUDING INCLUDING EXCLUDING
NET ASSET VALUE, END OF PERIOD REIMBURSEMENT/ REIMBURSEMENT/ REIMBURSEMENT/ PORTFOLIO
END OF PERIOD TOTAL RETURN(A) (IN 000'S) WAIVER WAIVER WAIVER TURNOVER RATE
--------------- -------------- ------------- ---------------- -------------- ---------------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00 $ 16.37 9.06% $ 217,423 0.16% 1.28% 1.37% 42%
10/31/99 15.98 14.56% 232,110 0.53% 1.28% 1.38% 20%
10/31/98 14.87 9.93% 214,110 0.75% 1.28% 1.35% 38%
10/31/97 16.24 30.10% 141,884 1.18% 1.27% 1.45% 93%
10/31/96(1) 13.78 20.25% 77,776 1.65% 1.34% 1.45% 59%
RETAIL B
10/31/00 16.23 8.35% 61,857 (0.60)% 2.04% 2.04% 42%
10/31/99 15.90 13.72% 62,366 (0.22)% 2.03% 2.04% 20%
10/31/98 14.83 9.09% 53,216 0.01% 2.02% 2.02% 38%
10/31/97 16.23 29.11% 35,178 0.31% 2.05% 2.28% 93%
10/31/96(2) 13.77 6.83%** 4,562 0.79%* 1.96%* 2.11%* 59%
TRUST
10/31/00 16.43 9.38% 678,398 0.44% 1.00% 1.00% 42%
10/31/99 16.02 14.85% 309,106 0.76% 1.05% 1.05% 20%
10/31/98 14.90 10.10% 254,060 1.00% 1.03% 1.03% 38%
10/31/97 16.28 30.43% 246,654 1.44% 1.03% 1.06% 93%
10/31/96(1) 13.80 20.77% 186,708 2.01% 1.02% 1.03% 59%
PRIME A
10/31/00 16.41 9.27% 156 0.30% 1.14% 1.24% 42%
10/31/99(2) 16.00 14.81% 150 0.66% 1.15% 1.30% 20%
PRIME B
10/31/00 16.32 8.38% 129 (0.45)% 1.89% 2.07% 42%
10/31/99(2) 15.97 13.98% 129 (0.09)% 1.90% 2.17% 20%
BKB
10/31/00(2) 16.43 2.43%** 137,484 0.50%* 0.92%* 1.10%* 42%
</TABLE>
77
<PAGE>
STRATEGIC EQUITY FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
---------------------------------------- ------------------------------------------
NET
NET NET REALIZED AND DIVIDENDS DISTRIBUTIONS NET
ASSET VALUE, INVESTMENT UNREALIZED TOTAL FROM FROM NET FROM INCREASE(DECREASE)
BEGINNING INCOME GAIN (LOSS) ON INVESTMENT INVESTMENT NET REALIZED TOTAL IN NET
OF PERIOD LOSS(B) INVESTMENTS OPERATIONS INCOME CAPITAL GAINS DISTRIBUTIONS ASSET VALUE
------------ ----------- -------------- ----------- ----------- -------------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00 $ 9.89 $ 0.04 $ 1.75 $ 1.79 $ (0.04) $ (1.18) $ (1.22) $ 0.57
10/31/99 9.62 0.04(3) 0.27 0.31 (0.03) (0.01) (0.04) 0.27
10/31/98(1) 10.00 --(2) (0.38) (0.38) -- -- -- (0.38)
RETAIL B
10/31/00 9.84 (0.04) 1.75 1.71 --(2) (1.18) (1.18) 0.53
10/31/99 9.61 (0.02)(3) 0.26 0.24 -- (0.01) (0.01) 0.23
10/31/98(1) 10.00 (0.02) (0.37) (0.39) -- -- -- (0.39)
TRUST
10/31/00 9.90 0.08 1.76 1.84 (0.08) (1.18) (1.26) 0.58
10/31/99 9.63 0.09(3) 0.27 0.36 (0.08) (0.01) (0.09) 0.27
10/31/98(1) 10.00 0.01 (0.37) (0.36) (0.01) -- (0.01) (0.37)
</TABLE>
-----------------------------------------
* Annualized
** Not Annualized
(1) The Fund commenced operations on March 4, 1998.
(2) Net investment income per share and dividends from net investment income
are less than $0.005.
(3) The selected per share data was calculated using the weighted average
shares outstanding method for the year.
(A) Calculation does not include the effect of any sales charge for Retail A
Shares and Retail B Shares.
(B) Net investment income per share before reimbursement/waiver of fees by the
Investment Advisor and/or affiliates and/or Administrator for Retail A
Shares for the years ended October 31, 2000 and 1999 and the period ended
October 31, 1998 were $0.00, $0.00 and $0.00, respectively. Net investment
(loss) per share before reimbursement/waiver of fees by the Investment
Advisor and/or affiliates and/or Administrator for Retail B Shares for the
years ended October 31, 2000 and 1999 and the period ended October 31, 1998
were $(0.08), $(0.08) and $(0.06), respectively. Net investment income per
share before reimbursement/waiver of fees by the Investment Advisor and/or
affiliatesand/or Administrator for Trust Shares for the years ended October
31, 2000 and 1999 and the period ended October 31, 1998 were $0.06, $0.06
and $0.00, respectively.
SEE NOTES TO FINANCIAL STATEMENTS.
78
<PAGE>
<TABLE>
<CAPTION>
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------
RATIO OF NET RATIO OF RATIO OF
INVESTMENT OPERATING OPERATING
INCOME (LOSS EXPENSES EXPENSES
NET ASSETS, INCLUDING INCLUDING EXCLUDING
NET ASSET VALUE, END OF PERIOD REIMBURSEMENT/ REIMBURSEMENT/ REIMBURSEMENT/ PORTFOLIO
END OF PERIOD TOTAL RETURN(A) (IN 000'S) WAIVER WAIVER WAIVER TURNOVER RATE
--------------- -------------- ------------- ---------------- -------------- ---------------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00 $ 10.46 21.09% $ 8,505 0.40% 1.20% 1.60% 81%
10/31/99 9.89 3.25% 8,229 0.41% 1.19% 1.63% 79%
10/31/98(1) 9.62 (3.75)%** 4,051 0.06%* 1.40%* 2.41%* 30%**
RETAIL B
10/31/00 10.37 20.33% 1,555 (0.35)% 1.95% 2.35% 81%
10/31/99 9.84 2.50% 1,348 (0.24)% 1.84% 2.40% 79%
10/31/98(1) 9.61 (4.76)%** 583 (0.55)%* 2.01%* 3.05%* 30%**
TRUST
10/31/00 10.48 21.69% 93,558 0.83% 0.78% 0.98% 81%
10/31/99 9.90 3.64% 71,063 0.80% 0.80% 1.00% 79%
10/31/98(1) 9.63 (3.62)%** 63,061 0.19%* 1.27%* 1.47%* 30%**
</TABLE>
79
<PAGE>
EQUITY VALUE FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
-------------------------------------- ------------------------------------------------------
NET
NET NET REALIZED AND DIVIDENDS DIVIDENDS IN DIVIDENDS
ASSET VALUE, INVESTMENT UNREALIZED TOTAL FROM FROM NET EXCESS OF NET FROM
BEGINNING INCOME GAIN ON INVESTMENT INVESTMENT INVESTMENT NET REALIZED TOTAL
OF PERIOD (LOSS)(B) INVESTMENTS OPERATIONS INCOME INCOME CAPITAL GAINS DIVIDENDS
------------ ----------- ----------- ----------- ----------- ---------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00 $ 18.28 $ (0.02) $ 1.25 $ 1.23 $ (0.01) $ --(2) $ (2.45) $ (2.46)
10/31/99 16.50 (0.03) 2.42 2.39 -- -- (0.61) (0.61)
10/31/98 18.21 0.03 1.50 1.53 (0.04) -- (3.20) (3.24)
10/31/97 15.96 0.11 4.16 4.27 (0.12) -- (1.90) (2.02)
10/31/96 14.33 0.14 2.74 2.88 (0.14) -- (1.11) (1.25)
RETAIL B
10/31/00 18.08 (0.15) 1.25 1.10 -- -- (2.45) (2.45)
10/31/99 16.44 (0.15) 2.40 2.25 -- -- (0.61) (0.61)
10/31/98 18.24 (0.08) 1.48 1.40 -- -- (3.20) (3.20)
10/31/97 15.99 -- 4.17 4.17 (0.02) -- (1.90) (1.92)
10/31/96(1) 14.74 0.04 1.25 1.29 (0.04) -- -- (0.04)
TRUST
10/31/00 18.35 0.04 1.25 1.29 (0.02) --(2) (2.45) (2.47)
10/31/99 16.51 0.03 2.42 2.45 -- -- (0.61) (0.61)
10/31/98 18.21 0.08 1.49 1.57 (0.07) -- (3.20) (3.27)
10/31/97 15.96 0.17 4.16 4.33 (0.18) -- (1.90) (2.08)
10/31/96 14.33 0.21 2.74 2.95 (0.21) -- (1.11) (1.32)
</TABLE>
NET
INCREASE(DECREASE)
IN NET
ASSET VALUE
-------------
RETAIL A
10/31/00 $ (1.23)
10/31/99 1.78
10/31/98 (1.71)
10/31/97 2.25
10/31/96 1.63
RETAIL B
10/31/00 (1.35)
10/31/99 1.64
10/31/98 (1.80)
10/31/97 2.25
10/31/96(1) 1.25
TRUST
10/31/00 (1.18)
10/31/99 1.84
10/31/98 (1.70)
10/31/97 2.25
10/31/96 1.63
---------------------------------------
* Annualized
** Not Annualized
(1) The Fund began issuing Retail B Shares on March 4, 1996.
(2) Dividends in excess of net investment income per share were less than
$0.005.
(A) Calculation does not include the effect of any sales charge for Retail A
Shares and Retail B Shares.
(B) Net investment income (loss) per share before reimbursement/waiver of fees
by the Investment Advisor and/or affiliates and/or Administrator for Retail
A Shares for the years ended October 31, 2000, 1999, 1998, 1997 and 1996
were $(0.02), $(0.03), $0.03, $0.11 and $0.14, respectively. Net investment
income (loss) per share before reimbursement/waiver of fees by the
Investment Advisor and/or affiliates and/or Administrator for Retail B
Shares for the years ended October 31, 2000, 1999, 1998 and 1997 and the
period ended October 31, 1996 were $(0.15), $(0.15), $(0.08), $(0.03) and
$0.01, respectively. Net investment income per share before
reimbursement/waiver of fees by the Investment Advisor and/or affiliates
and/or Administrator for Trust Shares for the years ended October 31, 2000,
1999, 1998, 1997 and 1996 were $0.04, $0.03, $0.08, $0.17 and $0.21,
respectively.
SEE NOTES TO FINANCIAL STATEMENTS.
80
<PAGE>
<TABLE>
<CAPTION>
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------
RATIO OF NET RATIO OF RATIO OF
INVESTMENT OPERATING OPERATING
INCOME (LOSS EXPENSES EXPENSES
NET ASSETS, INCLUDING INCLUDING EXCLUDING
NET ASSET VALUE, END OF PERIOD REIMBURSEMENT/ REIMBURSEMENT/ REIMBURSEMENT/ PORTFOLIO
END OF PERIOD TOTAL RETURN(A) (IN 000'S) WAIVER WAIVER WAIVER TURNOVER RATE
--------------- -------------- ------------- ---------------- -------------- ---------------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00 $ 17.05 7.83% $ 226,836 (0.10)% 1.36% 1.36% 72%
10/31/99 18.28 14.63% 258,332 (0.16)% 1.37% 1.37% 75%
10/31/98 16.50 9.88% 234,730 0.15% 1.37% 1.37% 82%
10/31/97 18.21 29.48% 182,641 0.63% 1.38% 1.38% 111%
10/31/96 15.96 21.49% 131,998 1.00% 1.45% 1.45% 116%
RETAIL B
10/31/00 16.73 7.12% 30,555 (0.83)% 2.09% 2.12% 72%
10/31/99 18.08 13.81% 30,988 (0.87)% 2.08% 2.08% 75%
10/31/98 16.44 9.07% 23,103 (0.54)% 2.06% 2.06% 82%
10/31/97 18.24 28.60% 14,958 (0.13)% 2.07% 2.38% 111%
10/31/96(1) 15.99 8.80%** 1,916 0.43%* 1.94%* 2.24%* 116%
TRUST
10/31/00 17.17 8.22% 164,864 0.26% 1.00% 1.00% 72%
10/31/99 18.35 15.04% 281,064 0.19% 1.02% 1.03% 75%
10/31/98 16.51 10.27% 254,432 0.49% 1.03% 1.03% 82%
10/31/97 18.21 29.87% 241,532 0.98% 1.04% 1.04% 111%
10/31/96 15.96 22.05% 194,827 1.42% 1.03% 1.03% 116%
</TABLE>
81
<PAGE>
EQUITY GROWTH FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
--------------------------------------- --------------------------------------------------------
NET DIVIDENDS
NET NET REALIZED AND DIVIDENDS IN EXCESS DIVIDENDS
ASSET VALUE, INVESTMENT UNREALIZED TOTAL FROM FROM NET OF NET FROM NET
BEGINNING INCOME GAIN ON INVESTMENT INVESTMENT INVESTMENT REALIZED TOTAL
OF PERIOD (LOSS)(B) INVESTMENTS OPERATIONS INCOME INCOME CAPITAL GAINS DIVIDENDS
------------ ------------ ----------- ------------ ----------- ----------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00 $ 28.99 $ (0.10)(2) $ 5.14 $ 5.04 $ -- $ -- $ (1.72) $ (1.72)
10/31/99 24.47 (0.06) 6.48 6.42 -- -- (1.90) (1.90)
10/31/98 25.14 0.01 3.19 3.20 (0.03) --(3) (3.84) (3.87)
10/31/97 20.37 0.07 6.05 6.12 (0.07) -- (1.28) (1.35)
10/31/96 17.29 0.10 3.39 3.49 (0.11) -- (0.30) (0.41)
RETAIL B
10/31/00 28.27 (0.35)(2) 5.02 4.67 -- -- (1.72) (1.72)
10/31/99 24.07 (0.20) 6.30 6.10 -- -- (1.90) (1.90)
10/31/98 24.91 (0.16)(2) 3.16 3.00 -- --(3) (3.84) (3.84)
10/31/97 20.26 (0.09)(2) 6.02 5.93 -- -- (1.28) (1.28)
10/31/96(1) 18.77 (0.01) 1.50 1.49 -- -- -- --
TRUST
10/31/00 29.15 0.01(2) 5.18 5.19 (0.01) -- (1.72) (1.73)
10/31/99 24.52 0.03 6.50 6.53 -- -- (1.90) (1.90)
10/31/98 25.17 0.09 3.20 3.29 (0.09) (0.01) (3.84) (3.94)
10/31/97 20.39 0.16 6.06 6.22 (0.16) -- (1.28) (1.44)
10/31/96 17.30 0.17 3.40 3.57 (0.18) -- (0.30) (0.48)
PRIME A
10/31/00 28.95 (0.05)(2) 5.13 5.08 -- -- (1.72) (1.72)
10/31/99(1) 24.49 (0.01) 6.37 6.36 -- -- (1.90) (1.90)
PRIME B
10/31/00 28.84 (0.29)(2) 5.11 4.82 -- -- (1.72) (1.72)
10/31/99(1) 24.49 (0.10) 6.35 6.25 -- -- (1.90) (1.90)
</TABLE>
---------------------------------------------------------------
* Annualized
** Not Annualized
(1) The Fund began issuing Retail B Shares on March 4, 1996 and Prime A and
Prime B Shares on November 1, 1998.
(2) The selected per share data was calculated using the weighted average
shares outstanding method for the year.
(3) Dividends in excess of net investment income per share were less than
$0.005.
(A) Calculation does not include the effect of any sales charge for Retail A
Shares, Retail B Shares, Prime A Shares and Prime B Shares.
(B) Net investment income (loss) per share before reimbursement/waiver of fees
by the Investment Advisor and/or affiliates and/or Administrator for Retail
A Shares for the years ended October 31, 2000, 1999, 1998, 1997 and 1996
were $(0.10)(2), $(0.06), $0.01, $0.07 and $0.10, respectively. Net
investment income (loss) per share before reimbursement/waiver of fees by
the Investment Advisor and/or affiliates and/or Administrator for Retail B
Shares for the years ended October 31, 2000, 1999, 1998 and 1997 and the
period ended October 31, 1996 were $(0.35)(2), $(0.21), $(0.16)(2),
$(0.14)(2) and $(0.03), respectively. Net investment income per share
before reimbursement/waiver of fees by the Investment Advisor and/or
affiliates and/or Administrator for Trust Shares for the years ended
October 31, 2000, 1999, 1998, 1997 and 1996 were $0.01(2), $0.03, $0.09,
$0.16 and $0.17, respectively. Net investment (loss) per share before
reimbursement/waiver of fees by the Investment Advisor and/or affiliates
and/or Administrator for Prime A Shares for the years ended October 31,
2000 and 1999 were $(0.09)(2) and $(0.04), respectively. Net investment
(loss) per share before reimbursement/waiver of fees by the Investment
Advisor and/or affiliates and/or Administrator for Prime B Shares for the
years ended October 31, 2000 and 1999 were $(0.34)(2) and $(0.14),
respectively.
SEE NOTES TO FINANCIAL STATEMENTS.
82
<PAGE>
<TABLE>
<CAPTION>
RATIOS TO AVERAGE NET ASSETS/
SUPPLEMENTAL DATA
----------------------------------
RATIO OF NET RATIO OF
INVESTMENT OPERATING
INCOME (LOSS) EXPENSES
NET INCREASE NET ASSETS, INCLUDING INCLUDING
(DECREASE) IN NET NET ASSET VALUE, END OF PERIOD REIMBURSEMENT/ REIMBURSEMENT/
ASSET VALUE END OF PERIOD TOTAL RETURN(A) (IN 000'S) WAIVER WAIVER
----------------- ----------------- -------------- -------------- ---------------- --------------
<S> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00 $ 3.32 $ 32.31 18.18% $ 580,417 (0.33)% 1.28%
10/31/99 4.52 28.99 27.55% 443,639 (0.25)% 1.34%
10/31/98 (0.67) 24.47 14.73% 312,951 0.02% 1.34%
10/31/97 4.77 25.14 31.61% 226,330 0.30% 1.37%
10/31/96 3.08 20.37 20.51% 160,800 0.50% 1.40%
RETAIL B
10/31/00 2.95 31.22 17.29% 130,347 (1.11)% 2.07%
10/31/99 4.20 28.27 26.63% 71,525 (0.96)% 2.05%
10/31/98 (0.84) 24.07 13.98% 34,693 (0.68)% 2.04%
10/31/97 4.65 24.91 30.78% 20,363 (0.40)% 2.07%
10/31/96(1) 1.49 20.26 7.95%** 3,995 (0.16)%* 1.92%*
TRUST
10/31/00 3.46 32.61 18.63% 1,258,399 0.04% 0.91%
10/31/99 4.63 29.15 28.07% 1,041,378 0.15% 0.94%
10/31/98 (0.65) 24.52 15.17% 815,756 0.40% 0.96%
10/31/97 4.78 25.17 32.16% 745,537 0.72% 0.95%
10/31/96 3.09 20.39 21.03% 562,419 0.92% 0.98%
PRIME A
10/31/00 3.36 32.31 18.36% 142 (0.17)% 1.12%
10/31/99(1) 4.46 28.95 27.30% 107 (0.05)% 1.14%
PRIME B
10/31/00 3.10 31.94 17.48% 450 (0.92)% 1.87%
10/31/99(1) 4.35 28.84 26.79% 246 (0.78)% 1.87%
</TABLE>
RATIOS TO AVERAGE NET ASSETS/
SUPPLEMENTAL DATA
-------------------------------
RATIO OF
OPERATING
EXPENSES
EXCLUDING
REIMBURSEMENT/ PORTFOLIO
WAIVER TURNOVER RATE
---------------- --------------
RETAIL A
10/31/00 1.28% 54%
10/31/99 1.34% 53%
10/31/98 1.34% 60%
10/31/97 1.37% 66%
10/31/96 1.40% 36%
RETAIL B
10/31/00 2.09% 54%
10/31/99 2.08% 53%
10/31/98 2.04% 60%
10/31/97 2.30% 66%
10/31/96(1) 2.29%* 36%
TRUST
10/31/00 0.91% 54%
10/31/99 0.94% 53%
10/31/98 0.96% 60%
10/31/97 0.95% 66%
10/31/96 0.98% 36%
PRIME A
10/31/00 1.23% 54%
10/31/99(1) 1.28% 53%
PRIME B
10/31/00 2.02% 54%
10/31/99(1) 2.19% 53%
83
<PAGE>
GROWTH FUND II
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
------------------------------------- --------------------------------------
NET
NET NET REALIZED AND DIVIDENDS DIVIDENDS
ASSET VALUE, INVESTMENT UNREALIZED TOTAL FROM FROM NET FROM NET
BEGINNING INCOME GAIN (LOSS) ON INVESTMENT INVESTMENT REALIZED TOTAL
OF PERIOD (LOSS)(B) INVESTMENTS OPERATIONS INCOME CAPITAL GAINS DIVIDENDS
------------ -------------- -------------- ------------ ------------ --------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00(1) $ 13.47 $ (0.04)(4) $ 1.25 $ 1.21 $ -- $ -- $ --
RETAIL B
10/31/00(1) 13.47 (0.03)(4) 1.24 1.21 -- -- --
TRUST
10/31/00(2) 12.72 (0.02)(4) 2.01 1.99 -- -- --
05/31/00 12.06 (0.06) 8.72 8.66 -- (8.00) (8.00)
05/31/99 12.93 (0.08) (0.41) (0.49) -- (0.38) (0.38)
05/31/98 12.20 (0.05) 1.59 1.54 -- (0.81) (0.81)
05/31/97 11.27 0.02 0.96 0.98 (0.05) -- (0.05)
05/31/96(3) 10.00 0.02 1.25 1.27 -- -- --
BKB
10/31/00(2) 12.72 (0.02)(4) 2.00 1.98 -- -- --
05/31/00 12.06 (0.06) 8.72 8.66 -- (8.00) (8.00)
05/31/99 12.93 (0.08) (0.41) (0.49) -- (0.38) (0.38)
05/31/98 12.20 (0.05) 1.59 1.54 -- (0.81) (0.81)
05/31/97 11.27 0.02 0.96 0.98 (0.05) -- (0.05)
05/31/96(3) 10.00 0.02 1.25 1.27 -- -- --
</TABLE>
------------------------------------------------
* Annualized
** Not Annualized
(1) The Fund began offering Retail A and Retail B Shares on June 26, 2000.
(2) The Fund commenced operations on March 28, 1996 as a separate portfolio
(the "Predecessor Fund") of the Boston 1784 Funds. On June 26, 2000, the
Predecessor Fund was reorganized as a new portfolio of the Trust. Prior to
the reorganization, the Predecessor Fund offered and sold one series of
shares. In connection with the reorganization, shareholders of the
Predecessor Fund exchanged their shares for either Trust Shares or
BKBShares of the Galaxy Growth Fund II. Shareholders of the Predecessor
Fund who purchased their shares through an investment management, trust,
custody or other agency relationship with BankBoston, N.A. received Trust
Shares of the Fund. Shareholders of the Predecessor Fund who purchased
their shares other than through an investment management, trust, custody or
other agency relationship with BankBoston, N.A. received BKB Shares of the
Fund. Information for periods prior to June 26, 2000 for the Trust Shares
and BKB Shares represents results of the Predecessor Fund.
(3) The Fund commenced operations on March 28, 1996.
(4) The selected per share data was calculated using the weighted average
shares outstanding method for the period.
(A) Calculation does not include the effect of any sales charge for Retail A
and Retail B Shares.
(B) Net investment (loss) per share before reimbursement/waiver of fees by the
Investment Advisor and/or affiliates and/or Administrator for Retail A
Shares for the period ended October 31, 2000 was $(0.04)(4). Net investment
(loss) per share before reimbursement/waiver of fees by the Investment
Advisor and/or affiliates and/or Administrator for Retail B Shares for the
period ended October 31, 2000 was $(0.03)(4). Net investment (loss) per
share before reimbursement/waiver of fees by the Investment Advisor and/or
affiliates and/or Administrator for Trust Shares for the period ended
October 31, 2000 was $(0.02)(4). Net investment (loss) per share before
reimbursement/waiver of fees by the Investment Advisor and/or affiliates
and/or Administrator for BKB Shares for the period ended October 31, 2000
was $(0.02)(4).
SEE NOTES TO FINANCIAL STATEMENTS.
84
<PAGE>
<TABLE>
<CAPTION>
RATIOS TO AVERAGE NET ASSETS/
SUPPLEMENTAL DATA
----------------------------------
RATIO OF NET RATIO OF
INVESTMENT OPERATING
INCOME (LOSS) EXPENSES
NET INCREASE NET ASSETS, INCLUDING INCLUDING
(DECREASE) IN NET NET ASSET VALUE, END OF PERIOD REIMBURSEMENT/ REIMBURSEMENT/
ASSET VALUE END OF PERIOD TOTAL RETURN(A) (IN 000'S) WAIVER WAIVER
----------------- ----------------- -------------- -------------- ---------------- --------------
<S> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00(1) $ 1.21 $ 14.68 8.91%** $ 1,638 (0.65)%* 1.23%*
RETAIL B
10/31/00(1) 1.21 14.68 8.76%** 688 (1.29)%* 1.87%*
TRUST
10/31/00(2) 1.99 14.71 15.64%** 90,451 (0.30)%* 0.88%*
05/31/00 0.66 12.72 65.97% 185,556 (0.33)% 0.88%
05/31/99 (0.87) 12.06 (3.54)% 185,476 (0.39)% 0.93%
05/31/98 0.73 12.93 12.64% 257,550 (0.35)% 0.91%
05/31/97 0.93 12.20 8.77% 261,487 0.17% 0.77%
05/31/96(3) 1.27 11.27 12.70%** 46,026 1.75%* 0.20%*
BKB
10/31/00(2) 1.98 14.70 15.57%** 58,844 (0.36)%* 0.94%*
05/31/00 0.66 12.72 65.97% 185,556 (0.33)% 0.88%
05/31/99 (0.87) 12.06 (3.54)% 185,476 (0.39)% 0.93%
05/31/98 0.73 12.93 12.64% 257,550 (0.35)% 0.91%
05/31/97 0.93 12.20 8.77% 261,487 0.17% 0.77%
05/31/96(3) 1.27 11.27 12.70%** 46,026 1.75%* 0.20%*
</TABLE>
RATIOS TO AVERAGE NET ASSETS/
SUPPLEMENTAL DATA
-------------------------------
RATIO OF
OPERATING
EXPENSES
EXCLUDING
REIMBURSEMENT/ PORTFOLIO
WAIVER TURNOVER RATE
---------------- --------------
RETAIL A
10/31/00(1) 1.35%* 28%**
RETAIL B
10/31/00(1) 2.25%* 28%**
TRUST
10/31/00(2) 0.99%* 28%**
05/31/00 1.13% 79%
05/31/99 1.18% 61%
05/31/98 1.16% 49%
05/31/97 1.15% 57%
05/31/96(3) 1.73%* 0%
BKB
10/31/00(2) 1.24%* 28%**
05/31/00 1.13% 79%
05/31/99 1.18% 61%
05/31/98 1.16% 49%
05/31/97 1.15% 57%
05/31/96(3) 1.73%* 0%
SEE NOTES TO FINANCIAL STATEMENTS.
85
<PAGE>
SMALL CAP VALUE FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
----------------------------------------- -------------------------------------------------------
NET DIVIDENDS
NET NET REALIZED AND DIVIDENDS IN EXCESS DIVIDENDS
ASSET VALUE, INVESTMENT UNREALIZED TOTAL FROM FROM NET OF NET FROM NET
BEGINNING INCOME GAIN(LOSS) ON INVESTMENT INVESTMENT INVESTMENT REALIZED TOTAL
OF PERIOD (LOSS)(B) INVESTMENTS OPERATIONS INCOME INCOME CAPITAL GAINS DIVIDENDS
------------ ------------ ------------- ------------ ----------- ----------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00 $ 12.98 $ 0.01(2) $ 2.63 $ 2.64 $ (0.01) $ -- $ (1.36) $ (1.37)
10/31/99 13.53 0.02 0.73 0.75 (0.03) -- (1.27) (1.30)
10/31/98 18.29 0.08 (2.08) (2.00) (0.08) -- (2.68) (2.76)
10/31/97 14.75 (0.04)(2) 5.72 5.68 -- -- (2.14) (2.14)
10/31/96(1) 12.68 0.01 2.95 2.96 (0.02) -- (0.87) (0.89)
RETAIL B
10/31/00 12.96 (0.10)(2) 2.63 2.53 -- -- (1.36) (1.36)
10/31/99(3) 13.59 (0.04) 0.68 0.64 -- -- (1.27) (1.27)
TRUST
10/31/00 13.07 0.08(2) 2.65 2.73 (0.06) -- (1.36) (1.42)
10/31/99 13.61 0.05 0.74 0.79 (0.06) -- (1.27) (1.33)
10/31/98 18.37 0.11 (2.06) (1.95) (0.13) -- (2.68) (2.81)
10/31/97 14.76 0.01(2) 5.74 5.75 -- -- (2.14) (2.14)
10/31/96(1) 12.71 0.05 2.97 3.02 (0.05) (0.01) (0.91) (0.97)
PRIME A
10/31/00 13.04 0.05(2) 2.64 2.69 (0.04) -- (1.36) (1.40)
10/31/99(3) 13.59 0.03 0.73 0.76 (0.04) -- (1.27) (1.31)
PRIME B
10/31/00 12.98 (0.05)(2) 2.62 2.57 -- -- (1.36) (1.36)
10/31/99(3) 13.59 (0.05) 0.71 0.66 -- -- (1.27) (1.27)
</TABLE>
-----------------------------------------------------------
(1) The Fund commenced operations on December 14, 1992 as a separate investment
portfolio (the "Predecessor Fund") of the Shawmut Funds. On December 4,
1995, the Predecessor Fund was reorganized as a new portfolio of the Trust.
Prior to the reorganization, the Predecessor Fund offered and sold two
series of shares, Investment Shares and Trust Shares, that were similar to
the Fund's Retail A Shares and Trust Shares, respectively. In connection
with the reorganization, shareholders of the Predecessor Fund exchanged
Investment Shares and Trust Shares for Retail A Shares and Trust Shares,
respectively, in the Galaxy Small Cap Value Fund.
(2) The selected per share data was calculated using the weighted average
shares outstanding method for the periods indicated.
(3) The Fund began issuing Retail B, Prime A and Prime B Shares on November 1,
1998.
(A) Calculation does not include the effect of any sales charge for Retail A
Shares, Retail B Shares, Prime A Shares and Prime B Shares.
(B) Net investment income (loss) per share before reimbursement/waiver of fees
by the Investment Advisor and/or affiliates and/or Administrator for Retail
A Shares for the years ended October 31, 2000, 1999, 1998, 1997 and 1996
were $0.00(2), $(0.02), $0.05, $(0.02)(2) and $0.01, respectively. Net
investment (loss) per share before reimbursement/waiver of fees by the
Investment Advisor and/or affiliates and/or Administrator for Retail B
Shares for the years ended October 31, 2000 and 1999 were $(0.12)(2) and
$(0.09), respectively. Net investment income (loss) per share before
reimbursement/waiver of fees by the Investment Advisor and/or affiliates
and/or Administrator for Trust Shares for the years ended October 31, 2000,
1999, 1998, 1997 and 1996 were $0.08(2), $0.05, $0.11, $0.05(2) and $0.05,
respectively. Net investment income per share before reimbursement/waiver
of fees by the Investment Advisor and/or affiliates and/or Administrator
for Prime A Shares for the years ended October 31, 2000 and 1999 were
$0.03(2) and $0.00, respectively. Net investment (loss) per share before
reimbursement/ waiver of fees by the Investment Advisor and/or affiliates
and/or Administrator for Prime B Shares for the years ended October 31,
2000 and 1999 were $(0.13)(2) and $(0.10), respectively.
SEE NOTES TO FINANCIAL STATEMENTS.
86
<PAGE>
<TABLE>
<CAPTION>
RATIOS TO AVERAGE NET ASSETS/
SUPPLEMENTAL DATA
----------------------------------
RATIO OF NET RATIO OF
INVESTMENT OPERATING
INCOME (LOSS) EXPENSES
NET INCREASE NET ASSETS, INCLUDING INCLUDING
(DECREASE) IN NET NET ASSET VALUE, END OF PERIOD REIMBURSEMENT/ REIMBURSEMENT/
ASSET VALUE END OF PERIOD TOTAL RETURN(A) (IN 000'S) WAIVER WAIVER
----------------- ----------------- -------------- -------------- ---------------- --------------
<S> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00 $ 1.27 $ 14.25 21.96% $ 87,457 0.08% 1.44%
10/31/99 (0.55) 12.98 5.68% 80,870 0.13% 1.31%
10/31/98 (4.76) 13.53 (12.52)% 87,781 0.38% 1.31%
10/31/97 3.54 18.29 43.58% 63,658 (0.25)% 1.30%
10/31/96(1) 2.07 14.75 24.77% 34,402 0.08% 1.40%
RETAIL B
10/31/00 1.17 14.13 21.06% 2,838 (0.71)% 2.23%
10/31/99(3) (0.63) 12.96 4.80% 1,637 (0.66)% 2.10%
TRUST
10/31/00 1.31 14.38 22.62% 332,703 0.58% 0.94%
10/31/99 (0.54) 13.07 6.02% 255,268 0.47% 0.97%
10/31/98 (4.76) 13.61 (12.07)% 202,385 0.73% 0.96%
10/31/97 3.61 18.37 44.08% 189,257 0.09% 0.96%
10/31/96(1) 2.05 14.76 25.22% 137,341 0.45% 1.05%
PRIME A
10/31/00 1.29 14.33 22.26% 189 0.36% 1.16%
10/31/99(3) (0.55) 13.04 5.80% 175 0.26% 1.18%
PRIME B
10/31/00 1.21 14.19 21.46% 170 (0.41)% 1.93%
10/31/99(3) (0.61) 12.98 4.96% 190 (0.49)% 1.93%
</TABLE>
RATIOS TO AVERAGE NET ASSETS/
SUPPLEMENTAL DATA
-------------------------------
RATIO OF
OPERATING
EXPENSES
EXCLUDING
REIMBURSEMENT/ PORTFOLIO
WAIVER TURNOVER RATE
---------------- --------------
RETAIL A
10/31/00 1.55% 43%
10/31/99 1.59% 42%
10/31/98 1.45% 33%
10/31/97 1.52% 52%
10/31/96(1) 1.55% 39%
RETAIL B
10/31/00 2.41% 43%
10/31/99(3) 2.88% 42%
TRUST
10/31/00 0.94% 43%
10/31/99 0.97% 42%
10/31/98 0.96% 33%
10/31/97 0.96% 52%
10/31/96(1) 1.06% 39%
PRIME A
10/31/00 1.32% 43%
10/31/99(3) 1.40% 42%
PRIME B
10/31/00 2.46% 43%
10/31/99(3) 2.49% 42%
87
<PAGE>
SMALL COMPANY EQUITY FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
-------------------------------------------- ---------------------------
NET
NET NET REALIZED AND DIVIDENDS NET
ASSET VALUE, INVESTMENT UNREALIZED TOTAL FROM FROM INCREASE(DECREASE)
BEGINNING INCOME GAIN (LOSS) ON INVESTMENT NET REALIZED TOTAL IN NET
OF PERIOD (LOSS)(B) INVESTMENTS OPERATIONS CAPITAL GAINS DIVIDENDS ASSET VALUE
------------- ------------ --------------- ------------- ------------- ------------ -------------
<S> <C> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00 $ 15.66 $(0.22) $ 6.31 $ 6.09 $ -- $ -- $ 6.09
10/31/99 13.63 (0.23) 2.26 2.03 -- -- 2.03
10/31/98 20.94 (0.19) (4.86) (5.05) (2.26) (2.26) (7.31)
10/31/97 19.96 (0.18) 3.54 3.36 (2.38) (2.38) 0.98
10/31/96 16.28 (0.14) 3.99 3.85 (0.17) (0.17) 3.68
RETAIL B
10/31/00 15.31 (0.37) 6.16 5.79 -- -- 5.79
10/31/99 13.39 (0.34) 2.26 1.92 -- -- 1.92
10/31/98 20.73 (0.30) (4.78) (5.08) (2.26) (2.26) (7.34)
10/31/97 19.91 (0.21) 3.41 3.20 (2.38) (2.38) 0.82
10/31/96(1) 17.27 (0.19)(2) 2.83 2.64 -- -- 2.64
TRUST
10/31/00 16.13 (0.12) 6.47 6.35 -- -- 6.35
10/31/99 13.96 (0.16) 2.33 2.17 -- -- 2.17
10/31/98 21.32 (0.14) (4.96) (5.10) (2.26) (2.26) (7.36)
10/31/97 20.20 (0.11) 3.61 3.50 (2.38) (2.38) 1.12
10/31/96 16.38 (0.09) 4.08 3.99 (0.17) (0.17) 3.82
</TABLE>
--------------------------------------------------
* Annualized
** Not Annualized
(1) The Fund began issuing Retail B Shares on March 4, 1996.
(2) The selected per share data was calculated using the weighted average
shares outstanding method for the period.
(A) Calculation does not include the effect of any sales charge for Retail A
Shares and Retail B Shares.
(B) Net investment (loss) per share before reimbursement/waiver of fees by the
Investment Advisor and/or affiliates and/or Administrator for Retail A
Shares for the years ended October 31, 2000, 1999, 1998, 1997 and 1996 were
$(0.22), $(0.23), $(0.19), $(0.18) and $(0.14), respectively. Net
investment (loss) per share before reimbursement/waiver of fees by the
Investment Advisor and/or affiliates and/or Administrator for Retail B
Shares for the years ended October 31, 2000, 1999, 1998 and 1997 and the
period ended October 31, 1996 were $(0.38), $(0.37), $(0.30), $(0.24) and
$(0.24)(2), respectively. Net investment (loss) per share before
reimbursement/waiver of fees by the Investment Advisor and/or affiliates
and/or Administrator for Trust Shares for the years ended October 31, 2000,
1999, 1998, 1997 and 1996 were $(0.12), $(0.16), $(0.14), $(0.11) and
$(0.09), respectively.
SEE NOTES TO FINANCIAL STATEMENTS.
88
<PAGE>
<TABLE>
<CAPTION>
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------
RATIO OF NET RATIO OF RATIO OF
INVESTMENT OPERATING OPERATING
LOSS EXPENSES EXPENSES
NET ASSETS, INCLUDING INCLUDING EXCLUDING
NET ASSET VALUE, END OF PERIOD REIMBURSEMENT/ REIMBURSEMENT/ REIMBURSEMENT/ PORTFOLIO
END OF PERIOD TOTAL RETURN(A) (IN 000'S) WAIVER WAIVER WAIVER TURNOVER RATE
--------------- -------------- ------------- ---------------- -------------- ---------------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00 $ 21.75 38.89% $ 125,427 (0.99)% 1.44% 1.44% 91%
10/31/99 15.66 14.89% 87,921 (1.41)% 1.53% 1.54% 105%
10/31/98 13.63 (26.26)% 95,831 (1.13)% 1.46% 1.47% 78%
10/31/97 20.94 19.08% 135,593 (1.02)% 1.46% 1.48% 69%
10/31/96 19.96 23.97% 111,101 (1.03)% 1.57% 1.57% 82%
RETAIL B
10/31/00 21.10 37.82% 18,936 (1.79)% 2.24% 2.25% 91%
10/31/99 15.31 14.34% 12,212 (2.04)% 2.16% 2.32% 105%
10/31/98 13.39 (26.72)% 12,565 (1.78)% 2.11% 2.16% 78%
10/31/97 20.73 18.23% 14,731 (1.76)% 2.20% 2.44% 69%
10/31/96(1) 19.91 15.34%** 3,659 (1.50)%* 2.04%* 2.44%* 82%
TRUST
10/31/00 22.48 39.43% 422,579 (0.58)% 1.03% 1.03% 91%
10/31/99 16.13 15.54% 233,326 (1.00)% 1.12% 1.12% 105%
10/31/98 13.96 (26.00)% 222,675 (0.76)% 1.09% 1.09% 78%
10/31/97 21.32 19.59% 310,751 (0.65)% 1.09% 1.12% 69%
10/31/96 20.20 24.69% 174,990 (0.60)% 1.14% 1.14% 82%
</TABLE>
89
<PAGE>
INTERNATIONAL EQUITY FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
----------------------------------------- --- --------------------------------------
NET
NET NET REALIZED AND DIVIDENDS DISTRIBUTIONS NET
ASSET VALUE, INVESTMENT UNREALIZED TOTAL FROM FROM NET FROM INCREASE(DECREASE)
BEGINNING INCOME GAIN (LOSS) ON INVESTMENT INVESTMENT NET REALIZED TOTAL IN NET
OF PERIOD LOSS(B) INVESTMENTS OPERATIONS INCOME CAPITAL GAINS DISTRIBUTIONS ASSET VALUE
------------ ----------- -------------- ----------- ----------- -------------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00 $ 20.86 $ 0.41(2) $ (0.59) $ (0.18) $ (0.05) $ (1.19) $ (1.24) $ (1.42)
10/31/99 16.75 0.01(2) 4.72 4.73 (0.05) (0.57) (0.62) 4.11
10/31/98 15.18 0.07 1.93 2.00 (0.07) (0.36) (0.43) 1.57
10/31/97 13.94 0.01 2.09 2.10 (0.18) (0.68) (0.86) 1.24
10/31/96 12.92 0.11 1.27 1.38 (0.12) (0.24) (0.36) 1.02
RETAIL B
10/31/00 20.80 0.22(2) (0.55) (0.33) -- (1.19) (1.19) (1.52)
10/31/99(1) 16.85 (0.09)(2) 4.74 4.65 (0.13) (0.57) (0.70) 3.95
TRUST
10/31/00 21.18 0.51(2) (0.60) (0.09) (0.16) (1.19) (1.35) (1.44)
10/31/99 17.00 0.10(2) 4.80 4.90 (0.15) (0.57) (0.72) 4.18
10/31/98 15.33 0.14 1.98 2.12 (0.09) (0.36) (0.45) 1.67
10/31/97 14.01 0.08 2.12 2.20 (0.20) (0.68) (0.88) 1.32
10/31/96 12.98 0.17 1.30 1.47 (0.20) (0.24) (0.44) 1.03
PRIME A
10/31/00 20.98 0.46(2) (0.60) (0.14) (0.12) (1.19) (1.31) (1.45)
10/31/99(1) 16.85 0.06(2) 4.79 4.85 (0.15) (0.57) (0.72) 4.13
PRIME B
10/31/00 20.85 0.29(2) (0.58) (0.29) -- (1.19) (1.19) (1.48)
10/31/99(1) 16.85 (0.08)(2) 4.78 4.70 (0.13) (0.57) (0.70) 4.00
BKB
10/31/00(1) 22.56 0.17(2) (3.01) (2.84) -- -- -- (2.84)
</TABLE>
----------------------------------------------
* Annualized
** Not Annualized
(1) The Fund began issuing Retail B, Prime A and Prime B Shares on November 1,
1998 and BKBShares on June 19, 2000.
(2) The selected per share data was calculated using the weighted average
shares outstanding method for the year.
(A) Calculation does not include the effect of any sales charge for Retail A
Shares, Retail B Shares, Prime A Shares and Prime B Shares.
(B) Net investment income (loss) per share before reimbursement/waiver of fees
by the Investment Advisor and/or affiliates and/or Administrator for Retail
A Shares for the years ended October 31, 2000, 1999, 1998, 1997 and 1996
were $0.35(2), $(0.04), $0.03, $(0.01) and $0.07, respectively. Net
investment (loss) per share before reimbursement/waiver of fees by the
Investment Advisor and/or affiliates and/or Administrator for Retail B
Shares for the years ended October 31, 2000 and1999 were $0.11(2) and
$(0.25), respectively. Net investment income per share before
reimbursement/waiver of fees by the Investment Advisor and/or affiliates
and/or Administrator for Trust Shares for the years ended October 31, 2000,
1999, 1998, 1997 and 1996 were $0.45(2), $0.06, $0.10, $0.04 and $0.13,
respectively. Net investment income (loss) per share before
reimbursement/waiver of fees by the Investment Advisor and/or affiliates
and/or Administrator for Prime A Shares for the years ended October 31,
2000 and 1999 were $0.26(2) and $(0.09), respectively. Net investment
income per share before reimbursement/waiver of fees by the Investment
Advisor and/or affiliates and/or Administrator for Prime B Shares for the
years ended October 31, 2000 and 1999 were $0.22(2) and $0.20,
respectively. Net investment income per share before reimbursement/waiver
of fees by the Investment Advisor and/or affiliates and/or Administrator
for BKB Shares for the period ended October 31, 2000 was $0.15(2).
SEE NOTES TO FINANCIAL STATEMENTS.
90
<PAGE>
<TABLE>
<CAPTION>
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------
RATIO OF NET RATIO OF RATIO OF
INVESTMENT OPERATING OPERATING
INCOME (LOSS) EXPENSES EXPENSES
NET ASSETS, INCLUDING INCLUDING EXCLUDING
NET ASSET VALUE, END OF PERIOD REIMBURSEMENT/ REIMBURSEMENT/ REIMBURSEMENT/ PORTFOLIO
END OF PERIOD TOTAL RETURN(A) (IN 000'S) WAIVER WAIVER WAIVER TURNOVER RATE
--------------- --------------- ------------- ---------------- -------------- ---------------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00 $ 19.44 (1.49)% $ 120,351 1.83% 1.32% 1.57% 50%
10/31/99 20.86 29.04% 89,327 0.03% 1.48% 1.73% 45%
10/31/98 16.75 13.64% 66,541 0.39% 1.48% 1.73% 49%
10/31/97 15.18 15.88% 56,592 0.03% 1.60% 1.85% 45%
10/31/96 13.94 10.86% 35,144 0.78% 1.70% 1.98% 146%
RETAIL B
10/31/00 19.28 (2.22)% 8,297 1.02% 2.14% 2.64% 50%
10/31/99(1) 20.80 28.41% 2,189 (0.45)% 1.96% 2.70% 45%
TRUST
10/31/00 19.74 (1.08)% 912,555 2.28% 0.87% 1.12% 50%
10/31/99 21.18 29.71% 501,776 0.54% 0.97% 1.22% 45%
10/31/98 17.00 14.32% 345,692 0.91% 0.96% 1.21% 49%
10/31/97 15.33 16.60% 265,124 0.57% 1.06% 1.32% 45%
10/31/96 14.01 11.51% 172,561 1.40% 1.08% 1.36% 146%
PRIME A
10/31/00 19.53 (1.34)% 14 2.06% 1.10% 1.99% 50%
10/31/99(1) 20.98 29.73% 12 0.34% 1.17% 2.03% 45%
PRIME B
10/31/00 19.37 (2.02)% 483 1.33% 1.83% 2.17% 50%
10/31/99(1) 20.85 28.74% 458 (0.38)% 1.89% 2.27% 45%
BKB
10/31/00(1) 19.72 (12.59)%** 25,807 2.08%* 1.07%* 1.32%* 50%
</TABLE>
91
<PAGE>
PAN ASIA FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------------
NET
NET REALIZED AND NET
ASSET VALUE, NET UNREALIZED TOTAL FROM (DECREASE)
BEGINNING INVESTMENT (LOSS) ON INVESTMENT IN NET
OF PERIOD INCOME(B) INVESTMENTS OPERATIONS ASSET VALUE
------------ ------------ ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
RETAIL A
10/31/00(1) $ 10.00 $ 0.02(2) $ (0.58) $ (0.56) $ (0.56)
RETAIL B
10/31/00(1) 10.00 0.01(2) (0.58) (0.57) (0.57)
TRUST
10/31/00(1) 10.00 0.02(2) (0.57) (0.55) (0.55)
PRIME A
10/31/00(1) 9.60 0.01(2) (0.16) (0.15) (0.15)
PRIME B
10/31/00(1) 9.60 0.01(2) (0.17) (0.16) (0.16)
</TABLE>
------------------------------------------------
* Annualized
** Not Annualized
(1) The Fund began offering Retail A, Retail B and Trust Shares on September 1,
2000 and Prime A and Prime B Shares on September 22, 2000.
(2) The selected per share data was calculated using the weighted average
shares outstanding method for the period.
(A) Calculation does not include the effect of any sales charge for Retail A
Shares and Retail B Shares.
(B) Net investment (loss) per share before reimbursement/waiver of fees by the
Investment Advisor and/or affiliates and/or Administrator for Retail A
Shares for the period ended October 31, 2000 was $(0.08). Net investment
(loss) per share before reimbursement/waiver of fees by the Investment
Advisor and/or affiliates and/or Administrator for Retail B Shares for the
period ended October 31, 2000 was $(0.05). Net investment (loss) per share
before reimbursement/waiver of fees by the Investment Advisor and/or
affiliates and/or Administrator for Trust Shares for the period ended
October 31, 2000 was $(0.04). Net investment (loss) per share before
reimbursement/waiver of fees by the Investment Advisor and/or affiliates
and/or Administrator for Prime A Shares for the period ended October 31,
2000 was $(0.39). Net investment (loss) per share before
reimbursement/waiver of fees by the Investment Advisor and/or affiliates
and/or Administrator for Prime B Shares for the period ended October 31,
2000 was $(0.40).
SEE NOTES TO FINANCIAL STATEMENTS.
92
<PAGE>
<TABLE>
<CAPTION>
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------
RATIO OF NET RATIO OF RATIO OF
INVESTMENT OPERATING OPERATING
INCOME EXPENSES EXPENSES
NET ASSETS, INCLUDING INCLUDING EXCLUDING
NET ASSET VALUE, END OF PERIOD REIMBURSEMENT/ REIMBURSEMENT/ REIMBURSEMENT/ PORTFOLIO
END OF PERIOD TOTAL RETURN(A) (IN 000'S) WAIVER WAIVER WAIVER TURNOVER RATE
--------------- -------------- ------------- ---------------- -------------- ---------------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
RETAIL A
10/31/00(1) $ 9.44 (5.60)%** $ 201 1.23%* 1.95%* 8.31%* 32%**
RETAIL B
10/31/00(1) 9.43 (5.80)%** 20 0.52%* 2.67%* 8.22%* 32%**
TRUST
10/31/00(1) 9.45 (5.60)%** 4,246 1.64%* 1.55%* 5.97%* 32%**
PRIME A
10/31/00(1) 9.45 (1.67)%** 2 1.23%* 1.95%* 44.37%* 32%**
PRIME B
10/31/00(1) 9.44 (1.77)%** 2 0.41%* 2.67%* 45.11%* 32%**
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
93
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION
The Galaxy Fund, a Massachusetts business trust (the "Trust"), is registered
under the Investment Company Act of 1940, as amended, as an open-end management
investment company. As of the date of this report, the Trust offered
thirty-seven managed investment portfolios. The accompanying financial
statements and financial highlights are those of the Asset Allocation Fund,
Equity Income Fund, Growth and Income Fund, Strategic Equity Fund, Equity Value
Fund, Equity Growth Fund, Growth Fund II (formerly known as Boston 1784 Growth
Fund), Small Cap Value Fund, Small Company Equity Fund, International Equity
Fund and Pan Asia Fund (individually, a "Fund," collectively, the "Funds") only.
The Asset Allocation Fund, Growth and Income Fund and International Equity
Fund are authorized to issue six series of shares (Trust Shares, Retail A
Shares, Retail B Shares, Prime A Shares, Prime B Shares and BKB Shares). The
Equity Income Fund, Strategic Equity Fund, Equity Value Fund, Equity Growth
Fund, Small Cap Value Fund, Small Company Equity Fund and Pan Asia Fund are
authorized to issue five series of shares (Trust Shares, Retail A Shares, Retail
B Shares, Prime A Shares and Prime B Shares). The Growth Fund IIis authorized to
issue four series of shares (Trust Shares, Retail A Shares, Retail B Shares and
BKBShares). Currently, the Asset Allocation, Growth and Income and International
Equity Funds offer all six series of authorized shares, the Equity Growth, Small
Cap Value and Pan Asia Funds offer all five series of authorized shares, the
Growth Fund II offers all four series of authorized shares and the Equity
Income, Strategic Equity, Equity Value and Small Company Equity Funds offer
Trust Shares, Retail A Shares, and Retail B Shares. Trust Shares, Retail A
Shares, Retail B Shares, Prime A Shares, Prime B Shares and BKB Shares are
substantially the same except that (i) Retail A Shares are subject to a maximum
3.75% front-end sales charge, (ii) Prime A Shares are subject to a maximum 5.50%
front-end sales charge, (iii) Retail B Shares and Prime B Shares are subject to
a maximum 5.00% contingent deferred sales charge, and (iv) each series of shares
bears the following series specific expenses: distribution fees and/or
shareholder servicing fees and transfer agency charges. Six years after
purchase, Retail B Shares will convert automatically to Retail A Shares and
eight years after purchase, Prime B Shares will convert automatically to Prime A
Shares. BKB Shares of the Asset Allocation Fund, Growth and Income Fund, Growth
Fund II and International Equity Fund will convert to Retail A Shares of the
same Fund on the first anniversary of the closing of the reorganization of the
Boston 1784 Funds into the Trust provided that prior thereto the Board of
Trustees of the Trust has determined that such conversion is in the best
interest of the holders of such BKB Shares.
2. SIGNIFICANT ACCOUNTING POLICIES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of income and expenses during the reporting period. Actual
results could differ from those estimates. The following is a summary of
significant accounting policies in conformity with generally accepted accounting
principles consistently followed by the Funds in the preparation of their
financial statements.
PORTFOLIO VALUATION: Investments in securities which are traded on a
recognized stock exchange are valued at the last sale price on the securities
exchange on which such securities are primarily traded or at the last sale price
on the national securities market. Securities traded on over-the-counter markets
are valued at the last bid price. Short-term obligations that mature in 60 days
or less are valued at amortized cost, which approximates fair value. All other
securities and other assets are appraised at their fair value as determined in
good faith under consistently applied procedures established by and under the
general supervision of the Board of Trustees.
SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are
accounted for on a trade date basis. Net realized gains or losses on sales of
securities are determined by the identified cost method. Interest income is
recorded on the accrual basis. Dividend income is recorded on the ex-dividend
date. Investment income and realized and unrealized gains and losses are
allocated to the separate series of a Fund based upon the relative net assets of
each series.
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS: The International Equity Fund and
Pan Asia Fund may enter into forward foreign currency exchange contracts whereby
the Fund agrees to buy or sell a specific currency at a specified price at a
future date in an attempt to hedge against fluctuations in the value of the
underlying currency of certain portfolio instruments. Forward foreign currency
exchange contracts are valued at the daily exchange rate of the underlying
currency. Purchases and sales of forward foreign currency exchange contracts
having the same settlement date and broker are offset and presented on a net
basis in the Statement of Assets and Liabilities. Gains or losses on the
purchase or sale of forward foreign currency exchange contracts having the same
settlement date and broker are recognized on the date of offset, otherwise gains
or losses are recognized on the settlement date.
FOREIGN CURRENCY TRANSLATION: The books and records of the International
Equity Fund and Pan Asia Fund are maintained in
94
<PAGE>
NOTES TO FINANCIAL STATEMENTS
U.S. dollars. Investment valuations and other assets and liabilities initially
expressed in foreign currencies are converted each business day into U.S.
dollars based upon current exchange rates. Purchases and sales of foreign
investments and income and expenses are converted into U.S. dollars based upon
exchange rates prevailing on the respective dates of such transactions. That
portion of unrealized gains or losses on investments due to fluctuations in
foreign currency exchange rates is not separately disclosed.
DIVIDENDS TO SHAREHOLDERS: Dividends from net investment income are determined
separately for each series of a Fund and are declared and paid quarterly, with
the exception of the International Equity Fund and Pan Asia Fund, which declare
and pay dividends annually. Net realized capital gains, if any, are distributed
at least annually.
Income dividends and capital gain dividends are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles.
FEDERAL INCOME TAXES: The Trust treats each Fund as a separate entity for
federal income tax purposes. Each Fund intends to continue to qualify each year
as a "regulated investment company" under Subchapter M of the Internal Revenue
Code. By so qualifying, each Fund will not be subject to federal income taxes to
the extent that it distributes substantially all of its taxable or tax-exempt
income, if any, for its tax year ending October 31. In addition, by distributing
in each calendar year substantially all of its net investment income, capital
gains and certain other amounts, if any, each Fund will not be subject to a
federal excise tax. Therefore, no federal income or excise tax provision is
recorded. Withholding taxes on foreign dividends have been paid or provided for
in accordance with the applicable country's tax rules and rates.
REPURCHASE AGREEMENTS: Each Fund may engage in repurchase agreement
transactions with institutions that the Trust's investment advisor has
determined are creditworthy. Each repurchase agreement transaction is recorded
at cost plus accrued interest. Each Fund requires that the securities
collateralizing a repurchase agreement transaction be transferred to the Trust's
custodian in a manner that is intended to enable the Fund to obtain those
securities in the event of a counterparty default. The value of the collateral
securities is monitored daily to ensure that the value of the collateral,
including accrued interest, equals or exceeds the repurchase price. Repurchase
agreement transactions involve certain risks in the event of default or
insolvency of the counterparty, including possible delays or restrictions upon a
Fund's ability to dispose of the underlying securities, and a possible decline
in the value of the underlying securities during the period while the Fund seeks
to assert its rights.
EXPENSES: The Trust accounts separately for the assets, liabilities and
operations of each Fund. Expenses directly attributable to a Fund are charged to
the Fund, while expenses which are attributable to more than one fund of the
Trust are allocated among the respective funds.
In addition, expenses of a Fund not directly attributable to the operations of
a particular series of shares of the Fund are allocated to the separate series
based upon the relative net assets of each series. Operating expenses directly
attributable to a series of shares of a Fund are charged to the operations of
that series.
ORGANIZATION COSTS: Each Fund bears all costs in connection with its
organization, including the fees and expenses of registering and qualifying its
initial shares for distribution under federal and state securities laws. All
such costs are amortized using the straight-line method over a period of five
years beginning with the commencement of each Fund's operations.
3. INVESTMENT ADVISORY, ADMINISTRATION, SHAREHOLDER SERVICES, DISTRIBUTION AND
OTHER FEES
The Trust and Fleet Investment Advisors Inc. (the "Investment Advisor" or
"Fleet"), an indirect wholly-owned subsidiary of FleetBoston Financial
Corporation, are parties to an investment advisory agreement under which the
Investment Advisor provides services for a fee, computed daily and paid monthly,
at the annual rate of 0.75% of the average daily net assets of the Asset
Allocation Fund, Equity Income Fund, Growth and Income Fund, Strategic Equity
Fund, Equity Value Fund, Equity Growth Fund, Growth Fund II, Small Cap Value
Fund and Small Company Equity Fund (See Note 4).
The Trust pays the Investment Advisor a fee, computed daily and paid monthly,
with respect to the International Equity Fund at the annual rate of 1.15% of the
first $50 million of the Fund's average daily net assets, plus 0.95% of the next
$50 million of such net assets, plus 0.85% of net assets in excess of $100
million.
The Trust pays the Investment Advisor a fee, computed daily and paid monthly,
with respect to the Pan Asia Fund at the annual rate of 1.20% of the Fund's
average daily net assets.
The Investment Advisor has entered into a sub-advisory agreement with Oechsle
International Advisors, LLC ("Oechsle") with respect to the International Equity
Fund pursuant to which the Investment Advisor pays fees to Oechsle, computed
daily and paid monthly, at the annual rate of 0.40% of the first $50 million of
the Fund's average daily net assets, plus 0.35% of net assets in excess of $50
million. FleetBoston Financial Corporation owns an interest in Oechsle.
95
<PAGE>
NOTES TO FINANCIAL STATEMENTS
The Investment Advisor has entered into a sub-advisory agreement with UOB
Global Capital LLC("UOB") with respect to the Pan Asia Fund pursuant to which
the Investment Advisor pays fees to UOB, computed daily and paid monthly, at the
annual rate of 0.72% of the Fund's average daily net assets.
Prior to June 26, 2000, Fleet National Bank (formerly known as BankBoston,
N.A.)("FNB"), an affiliate of the Investment Advisor, provided investment
advisory services to the Boston 1784 Growth Fund, the predecessor fund of the
Galaxy Growth Fund II (the "Predecessor Fund", see Note 9). FNB was paid a fee
for its services at an annual rate of 0.74% of the Fund's average daily net
assets. For the period June 1, 2000 through June 25, 2000, the fees paid to
FNBby the Predecessor Fund, which are included in the investment advisory fees
on the Statement of Operations for the period ended October 31, 2000, were
$91,432.
The Trust and PFPC Inc. (formerly known as First Data Investor Services Group,
Inc.), a member of PNC Financial Services Group (formerly known as PNC Bank
Corp.), are parties to an administration agreement under which PFPCInc. (the
"Administrator") provides services for a fee, computed daily and paid monthly,
at the annual rate of 0.09% of the first $2.5 billion of the combined average
daily net assets of the Funds and the other funds offered by the Trust (whose
financial statements are provided in separate reports), 0.085% of the next $2.5
billion of combined average daily net assets, 0.075% of the next $7 billion of
combined average daily net assets, 0.065% of the next $3 billion of combined
average daily net assets, 0.06% of the next $3 billion of combined average daily
net assets, 0.0575% of the next $3 billion of combined average daily net assets
and 0.0525% of combined average daily net assets in excess of $21 billion. Prior
to December 1, 1999, the services described above were provided by First Data
Investor Services Group, Inc., a wholly-owned subsidiary of First Data Corp. On
that date, PFPC Trust Co., a wholly-owned subsidiary of PNC Bank Corp., acquired
all of the outstanding stock of First Data Investor Services Group, Inc. As part
of that transaction, PFPC Inc., also an indirect wholly-owned subsidiary of
PNC Bank Corp., was merged into First Data Investor Services Group, Inc., which
then changed it's name to PFPC Inc.
In addition, PFPC Inc. also provides certain fund accounting, custody,
administration and transfer agency services pursuant to certain fee
arrangements. Pursuant to such fee arrangements, PFPC Inc. compensates the
Trust's custodian bank, The Chase Manhattan Bank, for its services.
Prior to June 26, 2000, SEI Investments Mutual Funds Services ("SEI"), a
wholly-owned subsidiary of SEI Investments Company, provided certain
administrative services to the Predecessor Fund. The fees paid to SEI were based
on the level of average aggregate net assets of the Boston 1784 Funds. For the
period ended October 31, 2000, the fees paid to SEI by the Predecessor Fund,
which are included in the administration fees on the Statement of Operations for
the period ended October 31, 2000, were $8,078.
Provident Distributors, Inc. (the "Distributor") acts as the exclusive
distributor of the Trust's shares. Prior to December 1, 1999, First Data
Distributors, Inc., a wholly-owned subsidiary of First Data Investor Services
Group, Inc., acted as the exclusive distributor of the Trust's shares.
Prior to June 26, 2000, SEI Investments Distribution Co. (The "Boston 1784
Distributor") served as the exclusive distributor of shares of the Predecessor
Fund. The Predecessor Fund had adopted a Distribution Plan (the "Boston 1784
Plan") which allowed the Predecessor Fund to use up to 0.25% of its average
daily net assets for the sale and distribution of its shares. At the time of the
reorganization of the Predecessor Fund into the Trust, the Boston 1784
Distributor was waiving all fees payable under the Boston 1784 Plan.
The Trust has adopted a shareholder services plan (the "Services Plan") with
respect to Retail A and Trust Shares of each Fund except the Pan Asia Fund.
Currently, the Services Plan has not been implemented with respect to the Funds'
Trust Shares. The Services Plan provides compensation to institutions (including
and currently limited to Fleet Bank and its affiliates) which provide
shareholder liaison and/or administrative support services to their customers
who beneficially own Retail A Shares, at an aggregate annual rate not to exceed
0.50% of the average daily net asset value of the outstanding Retail A Shares of
each Fund beneficially owned by such customers. The Trust, under the direction
of the Board of Trustees, is currently limiting fees payable under the Services
Plan with respect to each Fund to an aggregate annual rate not to exceed 0.30%
of the average daily net asset value of the outstanding Retail A Shares
beneficially owned by such customers.
The Trust has adopted a distribution plan (the "Distribution Plan") with
respect to Retail A Shares of the Pan Asia Fund. Under the Distribution Plan,
the Trust may pay the Distributor or another person for expenses and activities
primarily intended to result in the sale of Retail A Shares of the Fund.
Payments by the Trust under the Distribution Plan may not exceed the annual rate
of 0.50% of the average daily net assets attributable to the Fund's Retail A
Shares. The Trust, under the direction of the Board of Trustees, is currently
limiting the Fund's payments under the Distribution Plan to an annual rate of
not more than 0.25% (on an annualized basis) of the average daily net asset
value of the Fund's outstanding Retail A Shares.
96
<PAGE>
NOTES TO FINANCIAL STATEMENTS
The Trust has adopted a distribution and services plan (the "12b-1 Plan") with
respect to Retail B Shares of the Funds. Under the 12b-1 Plan, the Trust may pay
(i) the Distributor or another person for expenses and activities primarily
intended to result in the sale of Retail B Shares, (ii) institutions for
shareholder liaison services and (iii) institutions for administrative support
services. Currently, payments under the 12b-1 Plan for distribution services are
being made solely to broker-dealer affiliates of Fleet Bank and payments under
the 12b-1 Plan for shareholder liaison and administrative support services are
being made solely to Fleet Bank and its affiliates. Payments for distribution
expenses may not exceed an annual rate of 0.65% of the average daily net assets
attributable to each Fund's outstanding Retail B Shares. The fees paid for
shareholder liaison services and/or administrative support services may not
exceed the annual rates of 0.25% and 0.25%, respectively, of the average daily
net assets attributable to each Fund's outstanding Retail B Shares owned of
record or beneficially by customers of institutions. The Trust, under direction
of the Board of Trustees, is currently limiting each Fund's payments for
shareholder liaison and administrative support services under the 12b-1 Plan to
an aggregate fee of not more than 0.30% of the average daily net asset value of
Retail B Shares of the Fund owned of record or beneficially by customers of
institutions. For the year ended October 31, 2000, the Funds paid fees under the
Services Plan, Distribution Plan and 12b-1 Plan as follows:
SERVICES DISTRIBUTION 12B-1 PLAN
-------- ------------ ----------
PLAN PLAN SERVICES DISTRIBUTION
---- ---- -------- ------------
Asset Allocation$ 1,065,746 $-- $ 276,523 $ 650,302
Equity Income 554,530 -- 10,787 24,174
Growth and Income 647,172 -- 175,810 408,911
Strategic Equity 22,572 -- 4,264 9,457
Equity Value 688,464 -- 90,382 204,874
Equity Growth 1,446,176 -- 299,993 696,922
Growth II 873 -- 287 694
Small Cap Value 243,831 -- 6,735 15,634
Small Company Equity 316,162 -- 51,285 119,880
International Equity 281,596 -- 17,009 39,534
Pan Asia -- 53 42 79
The Trust has adopted a distribution plan (the "Prime A Shares Plan") with
respect to Prime A Shares of the Funds. Under the Prime A Shares Plan, the Trust
may pay the Distributor or another person for expenses and activities primarily
intended to result in the sale of Prime A Shares. Payments by the Trust under
the Prime A Shares Plan may not exceed the annual rate of 0.30% of the average
daily net assets attributable to each Fund's outstanding Prime A Shares. The
Trust, under direction of the Board of Trustees, is currently limiting each
Fund's payments under the Prime A Shares Plan to an annual rate of not more than
0.25% (on an annualized basis) of the average daily net asset value of each
Fund's outstanding Prime A Shares.
The Trust has adopted a distribution and services plan (the "Prime B Shares
Plan") with respect to Prime B Shares of the Funds. Under the Prime B Shares
Plan, the Trust may pay (i) the Distributor or another person for expenses and
activities primarily intended to result in the sale of Prime B Shares, (ii)
institutions for shareholder liaison services, and (iii) institutions for
administrative support services. Payments for distribution expenses may not
exceed the annual rate of 0.75% of the average daily net assets attributable to
each Fund's outstanding Prime B Shares. The fees paid to institutions for
shareholder liaison services and/or administrative support services may not
exceed the annual rates of 0.25% and 0.25%, respectively, of the average daily
net assets attributable to each Fund's outstanding Prime B Shares owned of
record or beneficially by customers of institutions. The Trust, under the
direction of the Board of Trustees, is currently limiting each Fund's payments
for shareholder liaison and administrative support services under the Prime B
Shares Plan to an aggregate fee of not more than 0.25% of the average daily net
asset value of Prime B Shares owned of record or beneficially by customers of
institutions. For the year ended October 31, 2000, the Funds paid fees under the
Prime A Shares Plan and Prime B Shares Plan as follows:
PRIME A PRIME B SHARES PLAN
------- -------------------
SHARES PLAN SERVICES DISTRIBUTION
----------- -------- ------------
Asset Allocation $ 506 $ 1,357 $ 4,157
Growth and Income 383 319 963
Equity Growth 323 999 3,007
Small Cap Value 456 438 1,314
International Equity 39 1,278 3,839
Pan Asia 1 1 2
The Trust has adopted a shareholder services plan (the "BKB Plan") with
respect to BKB Shares of the Asset Allocation Fund, Growth and Income Fund,
Growth Fund II and International Equity Fund. The BKB Plan provides compensation
to institutions (including Fleet Bank and its affiliates) which provide
shareholder liaison and/or administrative support services to their customers
who beneficially own BKB Shares at an aggregate annual rate not to exceed 0.50%
of the average daily net asset value of the outstanding BKB Shares of each Fund
beneficially owned by such customers. The Trust, under the direction of the
Board of Trustees, is currently limiting fees payable under the BKB Plan with
respect to each Fund to an aggregate annual rate not to exceed 0.30% of the
average daily net asset value of the outstanding BKB Shares beneficially owned
by such customers. For the year ended October 31, 2000, the Funds paid fees
under the BKB Plan as follows:
BKB PLAN
--------
Asset Allocation $ 12,200
Growth and Income 84,511
Growth II 44,400
International Equity 7,118
97
<PAGE>
NOTES TO FINANCIAL STATEMENTS
Retail A Shares, Retail B Shares, Trust Shares, Prime A Shares, Prime B Shares
and BKB Shares of the Funds each bear series specific transfer agent charges
based upon the number of shareholder accounts for each series. In addition,
Trust Shares also bear additional transfer agency fees in order to compensate
PFPC Inc. for payments made to Fleet Bank, an affiliate of the Investment
Advisor, for performing certain sub-account and administrative functions on a
per account basis with respect to Trust Shares held by defined contribution
plans. These additional fees are based on the number of underlying participant
accounts. For the year ended October 31, 2000, transfer agent charges for each
series were as follows:
RETAIL A RETAIL B TRUST BKB
-------- -------- ----- ---
Asset Allocation $ 497,429 $ 174,076 $ 554,101 $ 8,139
Equity Income 288,413 8,991 13,807 --
Growth and Income 458,042 142,700 530,940 31,229
Strategic Equity 26,427 6,191 123 --
Equity Value 459,771 94,354 276,844 --
Equity Growth 825,583 320,517 618,559 --
Growth II 1,841 370 261 19,226
Small Cap Value 318,570 13,896 127,379 --
Small Company Equity 337,391 73,465 425,017 --
International Equity 274,548 38,143 339,188 16,823
Pan Asia 454 156 241 --
PRIME A PRIME B
------- -------
Asset Allocation $ 340 $ 1,020
Growth and Income 162 239
Equity Growth 152 648
Small Cap Value 318 986
International Equity 103 486
Pan Asia 93 93
Certain officers of the Trust are officers of the Investment Advisor or PFPC
Inc. Such officers receive no compensation from the Trust for serving in their
respective roles. Effective September 8, 2000, each Trustee is entitled to
receive for services as a Trustee of the Trust, The Galaxy VIP Fund ("VIP") and
Galaxy Fund II ("Galaxy II") an aggregate fee of $54,000 per annum plus certain
other fees for attending or participating in meetings as well as reimbursement
for expenses incurred in attending meetings. For the period May 28, 1999 until
September 7, 2000, each Trustee was entitled to receive for services as a
Trustee of the Trust, VIP and Galaxy II an aggregate fee of $45,000 per annum
plus certain other fees for attending or participating in meetings as well as
reimbursement for expenses incurred in attending meetings. Prior to May 28,
1999, each Trustee was entitled to receive for services as a Trustee of the
Trust, VIP and Galaxy II an aggregate fee of $40,000 per annum plus certain
other fees for attending or participating in meetings as well as reimbursement
for expenses incurred in attending meetings. The Chairman of the Boards of
Trustees and the President and Treasurer of the Trust, VIP and Galaxy II are
also entitled to additional fees for their services in these capacities. These
fees are allocated among the funds of the Trust, VIP and Galaxy II based on
their relative net assets.
Each Trustee is eligible to participate in The Galaxy Fund/The Galaxy VIP
Fund/Galaxy Fund II Deferred Compensation Plan (the "Plan"), an unfunded,
non-qualified deferred compensation plan. The Plan allows each trustee to defer
receipt of all or a percentage of fees which otherwise would be payable for
services performed.
Expenses for the year ended October 31, 2000 include legal fees paid to
Drinker Biddle & Reath LLP. A partner of that firm is Secretary to the Trust.
Pursuant to procedures adopted by the Board of Trustees and in accordance with
the Investment Company Act of 1940, as amended, certain Funds placed a portion
of their portfolio transactions with Quick & Reilly Institutional Trading, a
division of Fleet Securities, Inc., an affiliate of the Investment Advisor. The
commissions paid to Quick & Reilly Institutional Trading for the year ended
October 31, 2000 were as follows:
FUND COMMISSIONS FUND COMMISSIONS
--------- ----------- --------- -----------
Asset Allocation $ 173,098 Strategic Equity $ 14,690
Equity Income 288,852 Equity Growth 98,173
Growth and Income 369,829 Small Cap Value 1,698,889
Equity Value 1,695,664
4. WAIVER OF FEES AND REIMBURSEMENT OF EXPENSES
Fleet and/or its affiliates and/or the Administrator voluntarily agreed to
waive a portion of their fees and/or reimburse the Funds for certain expenses so
that total expenses would not exceed certain expense limitations established for
each Fund. The respective parties, at their discretion, may revise or
discontinue the voluntary waivers and/or expense reimbursements at any time. For
the year ended October 31, 2000, Fleet and/or its affiliates and/or the
Administrator waived fees and/or reimbursed expenses with respect to the Funds
as follows:
FUND FEES WAIVED EXPENSES REIMBURSED
--------- ------------- --------------------
Asset Allocation $ 3,629 $ 13,261
Equity Income 2,350 1,465
Growth and Income 2,728 297,800
Strategic Equity 183,237 17,910
Equity Value 2,351 9,557
Equity Growth 3,105 14,787
Growth II 46,750 74,303
Small Cap Value 3,971 96,314
Small Company Equity 2,351 1,573
International Equity 2,217,035 12,127
Pan Asia 1,833 29,000
98
<PAGE>
NOTES TO FINANCIAL STATEMENTS
5. SHARES OF BENEFICIAL INTEREST
The Trust's Declaration of Trust authorizes the Trustees to issue an unlimited
number of shares of beneficial interest, each with a par value of $0.001. Shares
of the Trust are currently classified into forty-three classes of shares, each
consisting of one or more series.
Each share represents an equal proportionate interest in the respective Fund,
bears the same fees and expenses (except that Retail A Shares of each Fund,
except the Pan Asia Fund, bear the expense of payments under the Services Plan,
Retail A Shares of the Pan Asia Fund bear the expense of payments under the
Distribution Plan, Retail B Shares of a Fund bear the expense of payments under
the 12b-1 Plan, Prime A Shares of a Fund bear the expense of payments under the
Prime A Shares Plan, Prime B Shares of a Fund bear the expense of payments under
the Prime B Shares Plan, BKB Shares of a Fund bear the expense of payments under
the BKB Plan and Trust Shares, Retail A Shares, Retail B Shares, Prime A Shares,
Prime B Shares and BKB Shares of a Fund each bear series specific transfer agent
charges) and are entitled to such dividends and distributions of income earned
as are declared at the discretion of the Trust's Board of Trustees.
Shareholders are entitled to one vote for each full share held and a
proportionate fractional vote for each fractional share held, and will vote in
the aggregate and not by class or series, except as otherwise expressly required
by law or when the Board of Trustees determines that the matter to be voted on
affects only the interests of shareholders of a particular class or series.
6. PURCHASES AND SALES OF SECURITIES
The cost of purchases and proceeds from sales of securities, excluding
short-term investments, for year ended October 31, 2000 were as follows:
<TABLE>
<CAPTION>
PURCHASES SALES
---------------------------------------------------------------
FUND U.S. GOVERNMENT OTHER U.S. GOVERNMENT OTHER
----- --------------- -------------- ---------------- --------------
<S> <C> <C> <C> <C>
Asset Allocation .............................. $ 206,770,440 $ 221,716,564 $ 228,674,262 $ 250,686,757
Equity Income ................................. -- 147,050,870 -- 192,734,019
Growth and Income ............................. -- 326,350,011 -- 389,216,185
Strategic Equity .............................. -- 70,600,910 -- 69,070,088
Equity Value .................................. -- 363,787,947 -- 537,745,368
Equity Growth ................................. -- 1,098,842,263 -- 966,727,840
Growth II ..................................... -- 33,582,541 -- 88,791,252
Small Cap Value ............................... -- 150,831,653 -- 155,488,736
Small Company Equity .......................... -- 541,611,029 -- 468,042,634
International Equity .......................... -- 574,355,872 -- 423,127,289
Pan Asia ...................................... -- 4,660,201 -- 773,821
</TABLE>
The aggregate gross unrealized appreciation and depreciation, net unrealized
appreciation (depreciation) and cost for all securities as computed on a federal
income tax basis, at October 31, 2000 for each Fund is as follows:
<TABLE>
<CAPTION>
FUND APPRECIATION (DEPRECIATION) NET COST
----- --------------- --------------- -------------- --------------
<S> <C> <C> <C> <C>
Asset Allocation $ 175,083,967 $ (18,481,977) $ 156,601,990 $ 634,741,967
Equity Income 51,403,850 (17,074,324) 34,329,526 264,717,938
Growth and Income 338,465,408 (45,416,505) 293,048,903 771,338,118
Strategic Equity 17,614,005 (7,449,708) 10,164,297 93,187,867
Equity Value 89,810,790 (41,237,145) 48,573,645 367,226,155
Equity Growth 698,990,920 (42,051,896) 656,939,024 1,319,733,576
Growth II 57,777,858 (3,568,033) 54,209,825 97,402,106
Small Cap Value 79,646,367 (89,356,831) (9,710,464) 435,159,587
Small Company Equity 119,989,371 (72,463,365) 47,526,006 515,379,695
International Equity 144,460,356 (124,273,393) 20,186,963 1,021,370,815
Pan Asia 71,818 (366,210) (294,392) 4,609,076
</TABLE>
99
<PAGE>
NOTES TO FINANCIAL STATEMENTS
7. FOREIGN SECURITIES
Each Fund may purchase securities of foreign issuers. Investing in securities
of foreign issuers involves special risks not typically associated with
investing in securities of U.S. issuers. The risks include possible revaluation
of currencies, less complete financial information about companies and possible
future adverse political and economic developments. Moreover, securities of many
foreign issuers and their markets may be less liquid and their prices more
volatile than those of securities of comparable U.S. issuers.
8. LINE OF CREDIT
Each Fund and other affiliated funds participate in a $150 million unsecured
line of credit pursuant to a credit agreement dated as of December 29,1999.
Borrowings may be made under the credit agreement only for temporary or
emergency purposes, such as repurchase or redemption of shares of the Funds.
Interest is charged to each Fund based on its borrowings. In addition, a
commitment fee based on the average daily unused portion of the line of credit
is computed daily and paid quarterly at an annual rate of 0.10%, and allocated
among the Funds based on average daily net assets. For the period ended October
31, 2000, no borrowings have been made by the Funds against the line of credit.
9. ACQUISITION OF BOSTON 1784 FUNDS
At a meeting held on January 25, 2000, the Board of Trustees of the Trust
approved an Agreement and Plan of Reorganization (the "Agreement") providing for
the acquisition of the Boston 1784 Funds by the Trust. Pursuant to the
Agreement, (i) all of the assets and liabilities of the Boston 1784 Asset
Allocation Fund were transferred to the Galaxy Asset Allocation Fund in exchange
for 1,409,047 Trust Shares and 1,429,361 BKB Shares of the Asset Allocation
Fund, (ii) all of the assets and liabilities of the Boston 1784 Growth and
Income Fund were transferred to the Galaxy Growth and Income Fund in exchange
for 22,946,452 TrustShares and 9,313,418 BKB Shares of the Galaxy Growth and
Income Fund, (iii) all of the assets and liabilities of the Boston 1784 Growth
Fund were transferred to the Galaxy Growth Fund II in exchange for 9,947,709
Trust Shares and 4,233,708 BKB Shares of the Galaxy Growth Fund II, and (iv) all
of the assets and liabilities of the Boston 1784 International Equity Fund were
transferred to the Galaxy International Equity Fund in exchange for 16,286,179
Trust Shares and 1,192,870 BKB Shares of the International Equity Fund. In
related transactions, the assets and liabilities of the other Boston 1784 Fund
portfolios were transferred to corresponding Galaxy portfolios in exchange for
shares in such Galaxy portfolios. The acquisition, which qualified as a tax-free
reorganization for federal income tax purpose, was completed on June 26, 2000,
following the approval of the reorganization by Boston 1784 Fund shareholders.
The Galaxy Growth Fund II had nominal assets and liabilities prior to the
reorganization and was organized solely to acquire the assets and continue the
business, including carrying forward the financial and performance history, of
the Boston 1784 Growth Fund. Following the reorganization, the Galaxy Growth
Fund II changed its fiscal year-end from May 31 to October 31. The following is
a summary of the Net Assets, Shares Outstanding, Net Asset Value per share and
Unrealized Appreciation associated with the transaction:
<TABLE>
<CAPTION>
BEFORE AFTER
ACQUISITION ACQUISITION
---------------------------------------- --------------------
GALAXY BOSTON 1784 GALAXY
ASSET ALLOCATION ASSET ALLOCATION ASSET ALLOCATION
FUND FUND FUND
------------------ ------------------ --------------------
<S> <C> <C> <C>
Net Assets ............................ $ 755,931,805 $ 53,087,605 $ 809,019,410
Shares Outstanding 40,404,245 3,346,019 43,242,653
Net Asset Value, per share ............ $ -- $ 15.87 $ --
Trust Net Asset Value, per share ...... $ 18.70 $ -- $ 18.70
BKBNet Asset Value, per share ......... $ -- $ -- $ 18.70
Unrealized Appreciation ............... $ 170,332,794 $ 12,053,590 $ 182,386,384
</TABLE>
<TABLE>
<CAPTION>
BEFORE AFTER
ACQUISITION ACQUISITION
---------------------------------------- --------------------
GALAXY BOSTON 1784 GALAXY
GROWTH AND GROWTH AND GROWTH AND
INCOME FUND INCOME FUND INCOME FUND
------------------ ------------------ --------------------
<S> <C> <C> <C>
Net Assets ............................ $ 577,388,692 $ 517,738,641 $ 1,095,127,333
Shares Outstanding .................... 36,051,272 27,450,368 68,311,142
Net Asset Value, per share ............ $ -- $ 18.86 $ --
Trust Net Asset Value, per share ...... $ 16.05 $ -- $ 16.05
BKBNet Asset Value, per share ......... $ -- $ -- $ 16.05
Unrealized Appreciation ............... $ 108,988,321 $ 212,876,857 $ 321,865,178
</TABLE>
100
<PAGE>
<TABLE>
<CAPTION>
BEFORE AFTER
ACQUISITION ACQUISITION
--------------------------------------- --------------------
GALAXY BOSTON 1784 GALAXY
INTERNATIONAL INTERNATIONAL INTERNATIONAL
EQUITY FUND EQUITY FUND EQUITY FUND
------------------ ----------------- --------------------
<S> <C> <C> <C>
Net Assets ............................ $ 806,349,806 $ 394,399,000 $ 1,200,748,806
Shares Outstanding .................... 35,819,469 32,444,801 53,298,518
Net Asset Value, per share ............ $ -- $ 12.16 $ --
Trust Net Asset Value, per share ...... $ 22.56 $ -- $ 22.56
BKBNet Asset Value, per share ......... $ -- $ -- $ 22.56
Unrealized Depreciation ............... $ 165,169,199 $ 77,632,671 $ 242,801,870
</TABLE>
10. TAX INFORMATION (UNAUDITED)
During the fiscal year ended October 31, 2000, the Funds earned income from
direct obligations of the U.S. Government as follows:
U.S. GOVERNMENT
FUND INCOME
---------- ----------------
Asset Allocation Fund ................... 26.67%
Equity Income Fund ...................... 2.77
Strategic Equity Fund ................... 0.80
Equity Growth Fund ...................... 0.98
Small Cap Value Fund .................... 1.14
Small Company Equity Fund ............... 3.66
International Equity Fund ............... 0.30
Appropriate tax information detailing U.S. Government income percentages on a
calendar year basis will accompany your year-end tax statement. As each state's
rules on the exemption of this income differ, please consult your tax advisor
regarding specific tax treatment.
During the fiscal year ended October 31, 2000, the following Funds made
distributions from long-term capital gains:
LONG-TERM
FUND GAINS PAID
---------- ----------------
Asset Allocation Fund ................... $ 31,248,353
Equity Income Fund ...................... 43,289,105
Growth and Income Fund .................. 84,066,596
Strategic Equity Fund ................... 3,269,358
Equity Value Fund ....................... 74,802,811
Equity Growth Fund ...................... 218,342,896
Growth II ............................... 11,753,326
Small Cap Value Fund .................... 33,922,560
Small Company Equity Fund ............... 83,867,280
International Equity Fund ............... 106,022,517
101
<PAGE>
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
To the Shareholders and Board of Trustees of
The Galaxy Fund:
We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of the Galaxy Asset Allocation Fund, Galaxy
Equity Income Fund, Galaxy Growth and Income Fund, Galaxy Strategic Equity Fund,
Galaxy Equity Value Fund, Galaxy Equity Growth Fund, Galaxy Growth Fund II
(formerly, Boston 1784 Growth Fund), Galaxy Small Cap Value Fund, Galaxy Small
Company Equity Fund, Galaxy International Equity Fund, and Galaxy Pan Asia Fund
(eleven of the portfolios constituting The Galaxy Fund) as of October 31, 2000,
and for the Galaxy Growth Fund IIand Galaxy Pan Asia Fund the related statements
of operations, the statements of changes in net assets and the financial
highlights for the indicated periods ending October 31, 2000 and for the
remaining Funds, the statements of operations for the year then ended and the
statements of changes in net assets and financial highlights for each of the two
years in the period then ended. These financial statements and financial
highlights are the responsibility of the Fund's management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits. The financial highlights for the three years ended October
31, 1998 for the Galaxy Asset Allocation Fund, Galaxy Equity Income Fund, Galaxy
Growth and Income Fund, Galaxy Strategic Equity Fund, Galaxy Equity Value Fund,
Galaxy Equity Growth Fund, Galaxy Small Cap Value Fund, Galaxy Small Company
Equity Fund, and Galaxy International Equity Fund were audited by other auditors
whose report dated December 23, 1998 expressed an unqualified opinion on those
financial highlights. The statement of operations for the year ended May 31,
2000, the statement of changes in net assets for each of the two years in the
period then ended, and the financial highlights for each of the five years in
the period then ended, for the Galaxy Growth Fund II were audited by other
auditors whose report dated July 17, 2000 expressed an unqualified opinion on
those statements and financial highlights.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. 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
confirmation of securities owned as of October 31, 2000 by correspondence with
the custodian and brokers or other appropriate auditing procedures where replies
from brokers were not received. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the of
the Galaxy Asset Allocation Fund, Galaxy Equity Income Fund, Galaxy Growth and
Income Fund, Galaxy Strategic Equity Fund, Galaxy Equity Value Fund, Galaxy
Equity Growth Fund, Galaxy Growth Fund II, Galaxy Small Cap Value Fund, Galaxy
Small Company Equity Fund, Galaxy International Equity Fund, and Galaxy Pan Asia
Fund portfolios of The Galaxy Fund at October 31, 2000, the results of their
operations, changes in their net assets and their financial highlights for the
periods indicated above, in conformity with accounting principles generally
accepted in the United States.
Boston, Massachusetts
December 15, 2000
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GALAXY LOGO BLUE
---------------------
4400 Computer Drive Bulk Rate
P.O. Box 5108 U. S. Postage Paid
Westborough, MA 01581-5108 Permit No. 105
North Reading, MA
---------------------
ANEQU (1/1/01)