<PAGE>
COLONIAL NEW YORK TAX-EXEMPT FUND HIGHLIGHTS
FEBRUARY 1, 1995 - JULY 31, 1995
INVESTMENT OBJECTIVE: Colonial New York Tax-Exempt Fund seeks as high a level of
after-tax total return, as is consistent with prudent risk, by pursuing current
income exempt from federal and New York state personal income tax and
opportunities for long-term appreciation. For New York City residents, the
Fund's income may also be exempt from New York City personal income tax.
STRATEGY: The Fund pursues its objective by investing primarily in
investment-grade municipal bonds issued by the state
of New York and its municipalities.
THE FUND IS DESIGNED TO OFFER:
- High double- or triple-tax-free monthly income
- Diversification
- Emphasis on quality
PORTFOLIO MANAGER COMMENTARY: "New York's economy is slowly recovering. Although
discussions about tax-reform in Washington have had a negative impact on New
York municipal bonds, the overall economic environment for these securities
remains favorable."
<TABLE>
<CAPTION>
COLONIAL NEW YORK TAX-EXEMPT FUND PERFORMANCE
CLASS A CLASS B
<S> <C> <C>
Inception dates 9/26/86 8/4/92
Distributions declared per share $0.209 $0.183
SEC Yields on 7/31/95 5.40% 4.92%
Taxable-equivalent SEC Yields* 10.17% 9.26%
Total returns, assuming reinvestment of
all distributions and no sales charge
or contingent deferred sales charge (CDSC)
- 6 months 6.13% 5.74%
- 12 months 5.57% 4.79%
Net asset values per share at 7/31/95 $ 6.88 $ 6.88
</TABLE>
*Reflects exemption from federal, state, and New York City personal income tax.
<TABLE>
<CAPTION>
TOP FIVE SECTORS
<S> <C>
1. Education ....................13.25%
2. Turnpike/Toll Road/Bridge ....12.30%
3. Transportation ...............11.52%
4. Public Facilities ............10.84%
5. Tax Allocation ............... 8.44%
</TABLE>
<TABLE>
<CAPTION>
QUALITY BREAKDOWN
<S> <C>
AAA .............................27.54%
AA ..............................13.86%
A ...............................21.70%
BBB .............................31.08%
BB .............................. 0.77%
B ............................... 0.49%
Non-rated ....................... 4.56%
</TABLE>
2
<PAGE>
PRESIDENT'S MESSAGE
TO FUND SHAREHOLDERS
During the six months ended July 31, 1995, most fixed-income investments
provided attractive returns for investors. This reflected the decline in
interest rates that followed the overall slowing of the U.S. economy.
Almost all sectors of the bond market performed well during the period,
including corporate bonds, U.S. government bonds, and the New York municipal
bonds that are your Fund's primary investment focus. However, there were some
unfavorable developments that caused municipal securities to underperform some
other sectors of the bond market. Although discussions of tax reform in
Washington and some developments within your state created a less than ideal
environment for New York municipal bonds, the Fund still provided positive total
returns based on net asset value.
Jeffrey Augustine, Lead Portfolio Manager of Colonial New York Tax-Exempt Fund,
believes that although the potential impact of tax reform will continue to be a
concern, the economic environment for New York municipal bonds should continue
to improve in the months ahead. In the following report, Jeff comments on the
Fund's management strategy and on key issues affecting the New York municipal
bond market.
Respectfully,
/s/ John A. McNeice, Jr.
- ----------------------------
John A. McNeice, Jr.
President
September 13, 1995
3
<PAGE>
PORTFOLIO MANAGEMENT REPORT
JEFFREY AUGUSTINE is the Lead Portfolio Manager of Colonial New York Tax-Exempt
Fund. Jeff also manages four other Colonial tax-exempt funds. Before joining
Colonial, he was a General Partner in Naegele Augustine and Company, a Chicago
Board Options Exchange member firm. Jeff received a B.S. from Loyola University
of Chicago and he is a Chartered Financial Analyst.
SLOWING ECONOMY, LOWER INTEREST RATES BENEFIT FUND: It appears that the U.S.
economy is coming in for the "soft landing" that has been the Federal Reserve
Board's goal for the last two years. Real gross domestic product (GDP) for the
first two quarters of 1995 grew at an annualized rate of 2.8% and 1.1%,
respectively, down significantly from the annualized GDP growth rate of 5.1% for
the final quarter of 1994. This economic weakness, which translated into lower
interest rates, had a favorable impact on prices in the municipal bond market.
This was reflected in your Fund's total return and net asset value at the end of
the period.
BUDGET CUTS AFFECT SECURITY SELECTION: The state legislature balanced the
fiscal 1996 budget. To accomplish this, expenditures were reduced by $344
million, with a large portion of the cuts coming from local aid. This places a
greater financial burden on local governments in general, and New York City in
particular, to maintain vital services, including health care. For this reason,
we currently prefer state-issued bonds over New York City bonds.
LOWER TAXES MAY STIMULATE ECONOMY: Governor Pataki has followed through on his
campaign pledge to lower taxes -- the state income tax will be lowered by 20%
over three years. The Governor believes lower taxes will attract new businesses
that will be a source of jobs and tax revenues to the state. The unknown factor
is whether the state can balance short-term revenue losses with spending
reductions as the tax cut is implemented.
DISCUSSION OF TAX REFORM AFFECTS MARKET: With the recent shift in the political
climate in Washington, many strategies to help balance the federal budget are
being explored, including tax reform. Whenever this topic surfaces, the
tax-exempt status of municipal bonds comes under review, and the most recent
discussions have been no exception. The resulting scrutiny given to the
municipal bond market contributed to the market's underperformance relative to
U.S. government and corporate bonds. Despite this challenging environment,
however, your Fund's Class A shares still turned in a positive total return of
6.13% based on net asset value.
NEW YORK'S MUNI SUPPLY CONTINUES TO DECLINE: Low supply in New York's municipal
bond market partially offset the negative influence of tax reform discussions in
Washington. Although interest rates have declined in recent months, there has
not been a significant increase in refinancing activity. At the same time, the
new issue supply of New York municipal bonds remains
4
<PAGE>
relatively low. Colonial management believes that the supply of New York's new
issue bonds may go as low as $14.45 billion by the end of 1995, down from a high
of $30.77 billion in 1993.
LOOKING AHEAD: We will continue to monitor the tax-reform debate closely, and we
remain cautiously optimistic about New York's municipal bond
market.
COLONIAL NEW YORK TAX-EXEMPT FUND'S INVESTMENT PERFORMANCE
Change in Value of $10,000 from 9/86-7/95
Based on Net Asset Value and Maximum Offering Price for Class A Shares
[GRAPH FOR COLONIAL NEW YORK TAX-EXEMPT FUND'S INVESTMENT PERFORMANCE]
<TABLE>
<CAPTION>
PERFORMANCE GRAPH FIGURES
<S> <C>
NAV MOP
10,000 9,526
10,268 9,780
10,530 10,030
9,798 9,333
9,356 8,912
9,797 9,332
10,126 9,645
10,347 9,855
10,626 10,122
10,862 10,346
10,935 10,415
11,412 10,870
11,369 10,829
11,693 11,138
11,663 11,109
11,962 11,394
11,918 11,352
12,317 11,732
12,568 11,971
12,863 12,252
13,476 12,836
13,880 13,221
13,906 13,246
14,465 13,778
14,822 14,118
15,059 14,344
15,637 14,894
16,176 15,408
16,690 15,897
16,898 16,095
15,832 15,080
15,906 15,150
16,004 15,244
15,568 14,829
16,859 16,058
17,012 16,204
17,148 16,334
</TABLE>
A $10,000 investment in Class B shares made on August 4, 1992 (inception) at net
asset value would have been valued at $11,286 on July 31, 1995. The same
investment after deducting the applicable CDSC would have grown to $10,997 on
July 31, 1995.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS AS OF JUNE 30, 1995 (MOST RECENT QUARTER END)
- -------------------------------------------------------------------------------
CLASS A SHARES CLASS B SHARES
Inception 9/26/86 Inception 8/4/92
NAV MOP NAV W/CDSC
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1 YEAR 6.96% 1.88% 6.17% 1.17%
- -------------------------------------------------------------------------------
5 YEARS 7.30% 6.26% -- --
- -------------------------------------------------------------------------------
SINCE INCEPTION 6.25% 5.66% 3.99% 3.06%
- -------------------------------------------------------------------------------
</TABLE>
A portion of the Fund's income may be subject to the alternative minimum tax.
The 30-day SEC yield on July 31, 1995, of 5.40% for Class A shares and 4.92% for
Class B shares reflects the portfolio's earning power, net of expenses, and does
not include changes in Fund price.
If the Adviser had not borne certain Fund expenses, total returns would have
been lower and the yield for Class A shares would have been 4.96%, and the yield
for Class B shares would have been 4.46%. Taxable-equivalent SEC Yields are
based on the maximum 46.88% combined federal, state, and New York City personal
income tax rate.
Past performance cannot predict future results. Return and value of an
investment will vary, resulting in a gain or loss on sale. All results shown
assume reinvestment of distributions. Net asset value (NAV) return does not
include sales charges or CDSC. Maximum offering price (MOP) return includes the
maximum sales charge of 4.75%. The CDSC returns reflect charges of: one year,
5.00%; since inception, 3.00%.
Performance for different share classes will vary based on differences in sales
charges and fees associated with each class.
5
<PAGE>
INVESTMENT PORTFOLIO
JULY 31, 1995 (UNAUDITED, IN THOUSANDS)
<TABLE>
<CAPTION>
MUNICIPAL BONDS - 98.4% PAR VALUE
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
EDUCATION - 13.4%
Monroe County Industrial
Development Agency, Roberts
Weslyan College,
7.400% 09/01/11 $ 750 $ 787
State Dormitory Authority:
City University System, Series 1990-C,
7.500% 07/01/10 1,500 1,712
Series 1985-A,
7.800% 12/01/05 185 200
Series 1993-A:
5.250% 05/15/21 (a) 3,000 2,614
5.375% 05/15/16 3,000 2,644
6.000% 07/01/20 2,000 1,905
State University, Series A,
5.875% 05/15/17 2,000 1,907
University of New York:
Series 1990-B,
7.500% 05/15/11 1,000 1,144
Series 1993-A,
5.750% 07/01/13 1,000 937
----------
13,850
----------
- ----------------------------------------------------------------------------------------------------------------------------
GENERAL OBLIGATION - 0.4%
PR Commonwealth of Puerto Rico,
Series 1993,
3.260% 07/01/08(b) 1,100(c) 373
----------
- ----------------------------------------------------------------------------------------------------------------------------
HEALTH - 11.5%
HOSPITAL - 6.3%
State Certificate of Participation,
Office of Mental Health,
8.300% 09/01/12 1,000 1,079
State Medical Care Facilities
Finance Agency:
Presbyterian Hospital, Series 1994-A,
5.500% 08/15/24(a) 5,000 4,594
Vassar Brothers
Hospital, Series 1987-A,
8.250% 11/01/13 740 790
----------
6,463
----------
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
Investment Portfolio/July 31, 1995
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
HUMAN SERVICES PROVIDERS - 4.9%
State Medical Care Facilities
Finance Agency:
Mental Health Services, Series F,
5.250% 02/15/19 $ 4,000 $ 3,620
Series 1987-A,
8.875% 08/15/07 270 295
Series 1990-B,
7.875% 08/15/08 250 279
Series 1991-D,
7.400% 02/15/18 820 894
----------
5,088
----------
NURSING HOME - 0.3%
State Dormitory Authority,
Menorah Campus, Series 1991-A,
7.400% 02/01/31 245 269
----------
- -------------------------------------------------------------------------------------------------------------------
HOUSING - 12.8%
MULTI-FAMILY - 8.3%
Hudson Housing Development Corp.,
Providence Hall-Schuyler Project,
Series 1992-A,
6.500% 01/01/22 750 760
New York City Housing Development
Corp., Multi-family Housing,
Series 1993-A,
6.550% 10/01/15 1,500 1,509
Nyack Housing Assistance
Corp., Plaza Apartments,
7.375% 06/01/21 1,398 1,373
State Housing Finance Agency:
Multi-family Housing, Series 1989-B,
7.550% 11/01/29(a) 235 247
New York City, Series 1990-A,
8.000% 11/01/08 250 280
Series C,
6.125% 03/15/20 3,000 2,899
Yorktown Housing Corp.,
Beaveridge Apartments,
7.375% 06/01/21 1,456 1,456
----------
8,524
----------
SINGLE-FAMILY - 4.5%
Mortgage Agency:
Series EE 1,
8.050% 04/01/16 825 881
Series MM 1,
7.950% 10/01/21 1,000 1,076
</TABLE>
7
<PAGE>
<TABLE>
<CAPTION>
Investment Portfolio/July 31, 1995
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MUNICIPAL BONDS - CONT. PAR VALUE
- ------------------------------------------------------------------------------------------------------------------------------
HOUSING - CONT.
SINGLE - FAMILY - CONT.
State Dormitory Authority,
Series 1993-A,
5.250% 05/15/21 $ 2,320 $ 1,969
State Mortgage Agency:
Series BB-2,
7.950% 10/01/15 570 596
Series 10-A,
8.100% 04/01/14 105 111
----------
4,633
----------
- ------------------------------------------------------------------------------------------------------------------------
MANUFACTURING - 4.6%
CHEMICALS - 1.2%
Monroe County Industrial
Development Agency, Yorkmill Realty,
9.500% 12/01/06 1,205 1,258
----------
MACHINERY & COMPUTER CHIPS - 0.6%
Monroe County Industrial Development
Agency, Accede Mold & Tool Co.,
10.750% 11/01/07 615 619
----------
POLLUTION CONTROL REVENUE - 2.8%
Onondaga County Industrial
Development Authority, Bristol-Myers
Squibb Co., Series 1994,
5.750% 03/01/24(a) 3,000 2,929
----------
- ------------------------------------------------------------------------------------------------------------------------
PUBLIC FACILITIES & IMPROVEMENT - 10.8%
Albany Parking Authority,
Green and Hudson Garage Project,
Series 1991-A,
7.150% 09/15/16 250 261
New York City Industrial
Development Agency, United States Tennis
Association, Tennis Center Project,
6.375% 11/15/14(a) 1,500 1,554
State Dormitory Authority,
Series 1991-A,
9.500% 04/15/14 1,000 1,168
State Urban Development Corp.,
Correctional Facilities:
Series 4, 5,000 4,313
5.375% 01/01/23
Series 1993-A,
5.500% 01/01/14 3,000 2,753
</TABLE>
8
<PAGE>
<TABLE>
<CAPTION>
Investment Portfolio/July 31, 1995
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Triborough Bridge & Tunnel
Authority, Javits Convention Center
Project, Series E,
7.250% 01/01/10 $ 1,000 $ 1,114
----------
11,163
----------
- --------------------------------------------------------------------------------------------------------------------
PUBLIC INFRASTRUCTURE - 12.3%
TURNPIKE/TOLL ROAD/BRIDGE
State Thruway Authority,
Series A,
5.500% 01/01/23(a) 5,015 4,689
Triborough Bridge & Tunnel Authority:
Series A,
4.750% 01/01/19 4,000 3,340
Series L:
8.000% 01/01/07 1,000 1,094
8.125% 01/01/12 1,100 1,196
Series Y,
6.000% 01/01/12(a) 1,750 1,800
Series 1993-B,
(d) 01/01/21 2,000 430
PR Commonwealth of Puerto Rico,
Highway & Transportation Authority,
3.515% 07/01/09(b) 365(c) 126
----------
12,675
----------
- --------------------------------------------------------------------------------------------------------------------
REFUNDED/ESCROW/SPECIAL OBLIGATION(e) - 1.9%
State Dormitory Authority, State
University of New York, Series 1991-A,
7.250% 05/15/18 1,000 1,167
State Medical Care Facilities
Finance Agency, Series 1990-B,
7.875% 08/15/08 225 264
Syracuse Industrial Development
Authority, Parking Facilities,
Series 1990-A,
7.700% 06/01/15 500 568
----------
1,999
----------
- --------------------------------------------------------------------------------------------------------------------
SERVICES - 1.1%
BUSINESS SERVICES
United Nations Development Corp.,
Series 1992-A,
6.000% 07/01/07(a) 1,125 1,162
----------
</TABLE>
9
<PAGE>
<TABLE>
<CAPTION>
Investment Portfolio/July 31, 1995
- ---------------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS - CONT. PAR VALUE
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SOLID WASTE - 1.8%
MISCELLANEOUS DISPOSAL - 0.8%
St. Lawrence County Solid Waste
Disposal Authority, Series 1987,
8.875% 01/01/08 $ 750 $ 792
----------
RESOURCE RECOVERY - 1.0%
Babylon Industrial Development
Agency, Ogden Martin Systems,
Series 1985-B,
8.500% 01/01/19 495 539
Warren & Washington Counties
Industrial Development Authority,
Adirondack Series 1991-A,
8.000% 12/15/12 500 506
----------
1,045
----------
- ---------------------------------------------------------------------------------------------------------------------
TAX ALLOCATION - 8.4%
State Energy Research & Development
Authority, Series 1993-B, RIB, (Variable rate),
8.447% 04/01/20 1,500 1,564
State Local Government Assistance:
Series 1993-C,
5.500% 04/01/17(a) 2,000 1,853
Series 1993-E:
5.000% 04/01/21(a) 5,000 4,275
6.000% 04/01/14 1,000 1,001
----------
8,693
----------
- ---------------------------------------------------------------------------------------------------------------------
TRANSPORTATION, COMMUNICATION, ELECTRIC,
GAS & SANITARY SERVICES - 13.5%
AIR TRANSPORTATION - 2.0%
New York City Industrial
Development Agency, American
Airlines,
6.900% 08/01/24 2,000 2,045
----------
TRANSPORTATION - 11.5%
Metropolitan Transportation Authority,
Transportation Facilities, Series O:
5.500% 07/01/17(a) 3,200 2,916
5.750% 07/01/13(a) 4,000 3,800
Authority, Series 7:
(d) 07/01/14 8,430 2,529
4.750% 07/01/19 1,000 795
State Port Authority, Series 85,
5.375% 03/01/28(a) 2,000 1,822
----------
11,862
----------
</TABLE>
10
<PAGE>
<TABLE>
<CAPTION>
Investment Portfolio/July 31, 1995
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
UTILITY - 4.8%
INVESTOR OWNED - 0.8%
State Energy Research & Development
Authority, Brooklyn Gas Co.,
Series 1991-B, RIB, (Variable rate),
9.362% 07/15/26 $ 700 $ 787
----------
MUNICIPAL ELECTRIC - 4.0%
State Energy Research &
Development Authority, Consolidated
Edison Project:
5.250% 08/15/20(a) 4,000 3,575
Series 1991-A,
7.500% 01/01/26 500 536
----------
4,111
----------
- --------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 1.1%
WATER & SEWER
State Environmental Facilities
Corp., Series 1990-A,
7.500% 06/15/12(a) 1,000 1,121
----------
TOTAL MUNICIPAL BONDS (Cost of $96,638)(f) 101,461
----------
SHORT-TERM OBLIGATIONS - 0.5%
- --------------------------------------------------------------------------------------------------------------------
VARIABLE RATE DEMAND NOTES(g)
New York,
3.900% 08/15/03 400 400
New York City Water and Sewer,
Series G,
3.850% 06/15/24 100 100
----------
TOTAL SHORT-TERM OBLIGATIONS 500
----------
OTHER ASSETS & LIABILITIES, NET - 1.1% 1,173
- --------------------------------------------------------------------------------------------------------------------
NET ASSETS - 100.0% $ 103,134
==========
</TABLE>
11
<PAGE>
Investment Portfolio/July 31, 1995
- -------------------------------------------------------------------------
NOTES TO INVESTMENT PORTFOLIO:
- -------------------------------------------------------------------------
(a) These securities, or a portion thereof, with a total market
value of $38,951, are being used to collateralize open futures
contracts.
(b) These securities are variable rate instruments; on July 1, 1998
they will change to fixed rate instruments. Interest income is
accrued daily on the notional amount at the applicable interest
rates.
(c) Notional amount.
(d) Zero coupon bond.
(e) The Fund has been informed that each issuer has placed direct
obligations of the U.S. Government in an irrevocable trust,
solely for the payment of the interest and principal.
(f) Cost for federal income tax purposes is the same.
(g) Variable rate demand notes are considered short-term
obligations. Interest rates change periodically on specified
dates. These securities are payable on demand and are secured
by either letters of credit or other credit support agreements
from banks. The rates listed are as of July 31, 1995.
Acronym Name
------- ----
RIB Residual Interest Bond
Short futures contracts open at July 31, 1995:
<TABLE>
<CAPTION>
Par value Unrealized
covered by Expiration appreciation
Type contracts month at 7/31/95
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Treasury bonds $ 6,800 September $ 20
</TABLE>
See notes to financial statements.
12
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF ASSETS & LIABILITIES
JULY 31, 1995 (UNAUDITED)
(in thousands except for per share amounts and footnote)
<S> <C> <C>
ASSETS
Investments at value (cost $96,638) $ 101,461
Short-term obligations 500
-------------
101,961
Receivable for:
Interest $ 1,451
Fund shares sold 310
Investments sold 46
Other 27 1,834
---------- -------------
Total Assets 103,795
LIABILITIES
Payable for:
Distributions 487
Fund shares repurchased 120
Variation margin on futures 36
Accrued:
Deferred Trustees fees 1
Other 17
----------
Total Liabilities 661
-------------
NET ASSETS $ 103,134
=============
Net asset value & redemption price per share -
Class A ($54,731/7,960) $6.88
=============
Maximum offering price per share - Class A
($6.88/0.9525) $7.22(a)
=============
Net asset value & offering price per share -
Class B ($48,403/7,040) $6.88(b)
=============
COMPOSITION OF NET ASSETS
Capital paid in $ 106,647
Undistributed net investment income 122
Accumulated net realized loss (8,478)
Net unrealized appreciation on:
Investments 4,823
Open futures contracts 20
-------------
$ 103,134
=============
</TABLE>
(a)On sales of $50,000 or more the offering price is reduced.
(b)Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
13
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JULY 31, 1995 (UNAUDITED)
(in thousands)
<S> <C> <C>
INVESTMENT INCOME
Interest $ 3,285
EXPENSES
Management fee $ 277
Service fee 63
Distribution fee - Class B 177
Transfer agent 81
Bookkeeping fee 23
Trustees fee 8
Custodian fee 5
Audit fee 16
Legal fee 4
Registration fee 5
Reports to shareholders 2
Amortization of deferred charges 1
Other 7
--------------
669
Fees waived by the adviser (224) 445
-------------- -----------------
Net Investment Income 2,840
-----------------
NET REALIZED & UNREALIZED GAIN (LOSS) ON PORTFOLIO POSITIONS
Net realized loss on:
Investments (291)
Closed futures contracts (2,390)
--------------
Net Realized Loss (2,681)
Net unrealized appreciation during the period on:
Investments 5,196
Open futures contracts 457
--------------
Net Unrealized Appreciation 5,653
-----------------
Net Gain 2,972
-----------------
Net Increase in Net Assets From Operations $ 5,812
=================
</TABLE>
See notes to financial statements.
14
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
(Unaudited)
Six months Year ended
(in thousands) ended July 31 January 31
---------------------- -------------------
INCREASE (DECREASE) IN NET ASSETS 1995 1995
---------------------- -------------------
<S> <C> <C>
Operations:
Net investment income $ 2,840 $ 5,998
Net realized loss (2,681) (3,374)
Net unrealized appreciation (depreciation) 5,653 (9,199)
---------------------- -------------------
Net Increase (Decrease) from Operations 5,812 (6,575)
Distributions:
From net investment income - Class A (1,674) (3,470)
From net investment income - Class B (1,244) (2,334)
---------------------- -------------------
2,894 (12,379)
---------------------- -------------------
Fund Share Transactions:
Receipts for shares sold - Class A 4,926 7,297
Value of distributions reinvested - Class A 811 1,733
Cost of shares repurchased - Class A (5,933) (12,138)
---------------------- -------------------
(196) (3,108)
---------------------- -------------------
Receipts for shares sold - Class B 5,857 9,456
Value of distributions reinvested - Class B 700 1,395
Cost of shares repurchased - Class B (2,609) (7,464)
---------------------- -------------------
3,948 3,387
---------------------- -------------------
Net Increase from Fund Share Transactions 3,752 279
---------------------- -------------------
Total Increase (Decrease) 6,646 (12,100)
NET ASSETS
Beginning of period 96,488 108,588
---------------------- -------------------
End of period (including undistributed net
investment income of $122 and $199, respectively) $ 103,134 $ 96,488
====================== ===================
NUMBER OF FUND SHARES
Sold - Class A 711 1,059
Issued for distributions reinvested - Class A 117 254
Repurchased - Class A (856) (1,792)
---------------------- -------------------
(28) (479)
---------------------- -------------------
Sold - Class B 850 1,373
Issued for distributions reinvested - Class B 101 205
Repurchased - Class B (377) (1,117)
---------------------- -------------------
574 461
---------------------- -------------------
</TABLE>
See notes to financial statements.
15
<PAGE>
NOTES TO FINANCIAL STATEMENTS
JULY 31, 1995 (UNAUDITED)
NOTE 1. INTERIM FINANCIAL STATEMENTS
- ----------------------------------------------------------------------
In the opinion of management of Colonial New York Tax-Exempt Fund (the
Fund), a series of Colonial Trust V, the accompanying financial
statements contain all normal and recurring adjustments necessary for
the fair presentation of the financial position of the Fund at July 31,
1995, and the results of its operations, the changes in its net assets
and the financial highlights for the six months then ended.
NOTE 2. ACCOUNTING POLICIES
- ----------------------------------------------------------------------
ORGANIZATION: The Fund is a non-diversified portfolio of a Massachusetts
business trust registered under the Investment Company Act of 1940, as
amended, as an open end management investment company. The Fund may
issue an unlimited number of shares. The Fund offers Class A shares sold
with a front-end sales charge and Class B shares which are subject to an
annual distribution fee and a contingent deferred sales charge. Class B
shares will convert to Class A shares when they have been outstanding
approximately eight years. The following significant accounting policies
are consistently followed by the Fund in the preparation of its
financial statements and conform to generally accepted accounting
principles.
SECURITY VALUATION AND TRANSACTIONS: Debt securities generally are
valued by a pricing service based upon market transactions for normal,
institutional-size trading units of similar securities. When management
deems it appropriate, an over-the-counter or exchange bid quotation is
used.
Futures contracts are valued based on the difference between the last
sale price and the opening price of the contract.
Options are valued at the last reported sale price, or in the absence of
a sale, the mean between the last quoted bid and asking price.
Short-term obligations with a maturity of 60 days or less are valued at
amortized cost.
Portfolio positions which cannot be valued as set forth above are valued
at fair value under procedures approved by the Trustees.
Security transactions are accounted for on the date the securities are
purchased or sold.
Cost is determined and gains and losses are based upon the specific
identification method for both financial statement and federal income
tax purposes.
The fund may trade securities on other than normal settlement terms.
This may increase the risk if the other party to the transaction fails
to deliver and causes the Fund to subsequently invest at less
advantageous prices.
DETERMINATION OF CLASS NET ASSET VALUES AND FINANCIAL HIGHLIGHTS: All
income, expenses (other than the Class B distribution fee), realized and
unrealized gains (losses), are allocated to each class proportionately
on a daily basis for purposes of determining the net asset value of each
class.
Class B per share data and ratios are calculated by adjusting the expense and
net
16
<PAGE>
Notes to Financial Statements/July 31, 1995
- ----------------------------------------------------------------------
investment income per share data and ratios for the Fund for the entire
period by the annualized distribution fee applicable to Class B shares
only.
FEDERAL INCOME TAXES: Consistent with the Fund's policy to qualify as a
regulated investment company and to distribute all of its taxable and
tax-exempt income, no federal income tax has been accrued.
INTEREST INCOME, DEBT DISCOUNT AND PREMIUM: Interest income is recorded
on the accrual basis. Original issue discount is accreted to interest
income over the life of a security with a corresponding increase in the
cost basis; market discount is not accreted. Premium is amortized
against interest income with a corresponding decrease in the cost basis.
DISTRIBUTIONS TO SHAREHOLDERS: The Fund declares and records
distributions daily and pays monthly.
The amount and character of income and gains to be distributed are
determined in accordance with income tax regulations which may differ
from generally accepted accounting principles.
NOTE 3. FEES AND COMPENSATION PAID TO AFFILIATES
- ----------------------------------------------------------------------
MANAGEMENT FEE: Colonial Management Associates, Inc. (the Adviser) is
the investment adviser of the Fund and furnishes accounting and other
services and office facilities for a monthly fee based on each Fund's
pro rata portion of the combined average net assets of Trust V as
follows:
<TABLE>
<CAPTION>
Average Net Assets Annual Fee Rate
------------------ -----------------
<S> <C>
First $1 billion....................................... 0.55%
Next $1 billion........................................ 0.50%
Over $2 billion........................................ 0.45%
</TABLE>
BOOKKEEPING FEE: The Adviser provides bookkeeping and pricing services
for $27,000 per year plus 0.035% of the Fund's average net assets over
$50 million.
TRANSFER AGENT: Colonial Investors Service Center, Inc. (the Transfer Agent), an
affiliate of the Adviser, provides shareholder services for a monthly fee equal
to 0.14% annually of the Fund's average net assets and receives a reimbursement
for certain out of pocket expenses.
UNDERWRITING DISCOUNTS, SERVICE AND DISTRIBUTION FEES: Colonial
Investment Services, Inc. (the Distributor), an affiliate of the
Adviser, is the Fund's principal underwriter. During the six months
ended July 31, 1995, the Distributor retained net underwriting discounts
of $11,165 on sales of the Fund's Class A shares and received contingent
deferred sales charges (CDSC) of $69,877 on Class B share redemptions.
The Fund has adopted a 12b-1 plan which requires the payment of a
distribution fee to the Distributor equal to 0.75% annually of the
Fund's average net assets attributable Class B shares. The plan also
requires the payment of a service fee to the Distributor as follows:
17
<PAGE>
Notes to Financial Statements/July 31, 1995
- ----------------------------------------------------------------------
NOTE 3. FEES AND COMPENSATION PAID TO AFFILIATES - CONT.
<TABLE>
<CAPTION>
Valuation of shares Annual
outstanding on the 20th of Fee
each month which were issued Rate
--------------------------------------------------- -----------
<S> <C>
Prior to November 30, 1994..................... 0.10%
On or after December 1, 1994................... 0.25%
</TABLE>
The CDSC and the fees received from the 12b-1 plan are used principally
as repayment to the Distributor for amounts paid by the Distributor to
dealers who sold such shares.
EXPENSE LIMITS: The Adviser has agreed, until further notice to waive
fees and bear certain Fund expenses to the extent that total expenses
(exclusive of service and distribution fees, brokerage commissions,
interest, taxes, and extraordinary expenses, if any) exceed 0.40%
annually of the Fund's average net assets.
Effective August 1, 1995, and until further notice, the expense limit
changed to 0.50% of the Fund's average net assets.
OTHER: The Fund pays no compensation to its officers, all of whom are employees
of the Adviser.
The Fund's Trustees may participate in a deferred compensation plan
which may be terminated at any time. Obligations of the plan will be
paid solely out of the Fund's assets.
NOTE 4. PORTFOLIO INFORMATION
- ----------------------------------------------------------------------
INVESTMENT ACTIVITY: During the six months ended July 31, 1995,
purchases and sales of investments, other than short-term obligations,
were $10,829,240 and $7,007,331, respectively.
Unrealized appreciation (depreciation) at July 31, 1995, based on cost
of investments for both financial statement and federal income tax
purposes was:
<TABLE>
<S> <C>
Gross unrealized appreciation $ 5,506,051
Gross unrealized depreciation (683,331)
------------------
Net unrealized appreciation $ 4,822,720
==================
</TABLE>
CAPITAL LOSS CARRYFORWARDS: At January 31, 1995, capital loss
carryforwards available (to the extent provided in regulations) to
offset future realized gains were approximately as follows:
<TABLE>
<CAPTION>
Year of Capital loss
expiration carryforward
------------------- ---------------------------
<S> <C>
1996............... $ 2,052,000
1997............... 228,000
1998............... 26,000
1999............... 37,000
2003............... 187,000
------------------
$ 2,530,000
==================
</TABLE>
18
<PAGE>
Notes to Financial Statements/July 31, 1995
- ----------------------------------------------------------------------
Expired capital loss carryforwards, if any, are recorded as a reduction
of capital paid in.
To the extent loss carryforwards are used to offset any future realized
gains, it is unlikely that such gains would be distributed since they
may be taxable to shareholders as ordinary income.
OTHER: There are certain risks arising from geographic concentration in
any state. Certain revenue or tax related events in a state may impair
the ability of certain issuers of municipal securities to pay principal
and interest on their obligations.
The Fund may focus its investments in certain industries, subjecting it
to greater risk than a fund that is more diversified.
The Fund sells municipal and Treasury bond futures contracts to manage
overall portfolio interest rate exposure and not for trading purposes.
The use of futures contracts involves certain risks, which include (1)
imperfect correlation between the price movement of the contracts and
the underlying securities, (2) inability to close out positions due to
different trading hours, or the temporary absence of a liquid market,
for either the contract or the underlying securities, or (3) an
inaccurate prediction by the Adviser of the future direction of interest
rates. Any of these risks may involve amounts exceeding the initial or
variation margin recorded in the Fund's Statement of Assets and
Liabilities at any given time.
NOTE 5. RESULTS OF SPECIAL SHAREHOLDERS MEETING
- ----------------------------------------------------------------------
On February 15, 1995, a special meeting of shareholders was held and a
new Management Agreement between the Trust and Colonial Management
Associates, Inc. was approved that became effective upon the completion
of the merger of The Colonial Group, Inc. and Apple Merger Corporation,
a subsidiary of Liberty Financial Companies, Inc. on March 24, 1995. Of
the shares of beneficial interest outstanding on December 9, 1994,
8,772,394 voted for the new Management Agreement, 166,283 voted against
and 570,402 abstained. Of the shares of beneficial interest outstanding
that abstained, 23,704 represented broker non-votes.
19
<PAGE>
FINANCIAL HIGHLIGHTS
(Selected data for a share of each class outstanding throughout each
period are as follows)
<TABLE>
<CAPTION>
(Unaudited)
Six months ended Year ended
July 31 January 31
----------------------------------------------- ------------------------------------
1995 1995
Class A Class B Class A Class B
---------------- ------------- -------------- ---------------
<S> <C> <C> <C> <C>
Net asset value-
Beginning of period $ 6.680 $ 6.680 $ 7.500 $ 7.500
------------ ----------- ---------- ----------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income(a) 0.203 0.177 0.427 0.376
Net realized and
unrealized gain (loss) 0.206 0.206 (0.834) (0.834)
------------ ----------- ---------- ----------
Total from Investment
Operations 0.409 0.383 (0.407) (0.458)
------------ ----------- ---------- ----------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS:
From net investment income (0.209) (0.183) (0.413) (0.362)
From capital paid in --- --- --- ---
------------ ----------- ---------- ----------
Total Distributions
Declared to Shareholders (0.209) (0.183) (0.413) (0.362)
------------ ----------- ---------- ----------
Net asset value -
End of period $ 6.880 $ 6.880 $ 6.680 $ 6.680
============ =========== ========== ==========
Total return(c)(d) 6.13%(e) 5.74%(e) (5.32%) (6.04%)
============ =========== ========== ==========
RATIOS TO AVERAGE NET ASSETS
Expenses 0.52%(f)(g) 1.27%(f)(g) 0.42%(f) 1.17%(f)
Net investment income 5.87%(g) 5.12%(g) 6.25% 5.50%
Fees and expenses waived
or borne by the adviser 0.44%(g) 0.44%(g) 0.46% 0.46%
Portfolio turnover 14%(g) 14%(g) 65% 65%
Net assets at end
of period (000) $ 54,731 $ 48,403 $ 53,322 $ 43,166
<FN>
(a) Net of fees and expenses
waived or borne by the
Adviser which amounted to........ $ 0.015 $ 0.015 $ 0.032 $ 0.032
(b) Class B shares were initially offered on August 4, 1992. Per share
amounts reflect activity from that date.
(c) Total return at net asset value assuming all distributions reinvested
and no initial sales charge or contingent deferred sales charge.
(d) Had the Adviser not waived or reimbursed a portion of expenses total
return would have been reduced.
(e) Not annualized.
(f) Includes service fee of 0.12% (annualized) for the period ended July 31,
1995, and 0.02% (not annualized) for the year ended January 31, 1995,
respectively.
(g) Annualized.
</FN>
</TABLE>
20
<PAGE>
FINANCIAL HIGHLIGHTS - CONTINUED
<TABLE>
<CAPTION>
Year ended January 31
----------------------------------------------------------------------------------------------
1994 1993 1992 1991
Class A Class B Class A Class B (b) Class A Class A
------------ ------------ ------------ -------------- -------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value-
Beginning of period $ 7.090 $ 7.090 $ 6.840 $ 7.130 $ 6.600 $ 6.590
--------- --------- --------- --------- ---------- ---------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income(a) 0.421 0.368 0.438 0.182 0.453 0.459
Net realized and
unrealized gain (loss) 0.407 0.407 0.260 (0.029) 0.242 0.013
--------- --------- --------- --------- ---------- ---------
Total from Investment
Operations 0.828 0.775 0.698 0.153 0.695 0.472
--------- --------- --------- --------- ---------- ---------
LESS DISTRIBUTIONS DECLARED
TO SHAREHOLDERS:
From net investment income (0.418) (0.365) (0.445) (0.190) (0.455) (0.462)
From capital paid in --- --- (0.003) (0.003) --- ---
--------- --------- --------- --------- ---------- ---------
Total Distributions
Declared to Shareholders (0.418) (0.365) (0.448) (0.193) (0.455) (0.462)
--------- --------- --------- --------- ---------- ---------
Net asset value -
End of period $ 7.500 $ 7.500 $ 7.090 $ 7.090 $ 6.840 $ 6.600
========= ========= ========= ========= ========== =========
Total return(c)(d) 11.95% 11.14% 10.50% 1.16%(e) 10.86% 7.42%
========= ========= ========= ========= ========== =========
RATIOS TO AVERAGE NET ASSETS
Expenses 0.62% 1.37% 0.96% 1.71%(g) 1.00% 1.04%
Net investment income 5.68% 4.93% 6.25% 5.50%(g) 6.71% 6.99%
Fees and expenses waived
or borne by the adviser 0.29% 0.29% 0.06% 0.06% 0.14% 0.24%
Portfolio turnover 25% 25% 7% 7% 17% 6%
Net assets at end
of period (000) $ 63,527 $ 45,061 $ 53,779 $ 14,743 $ 40,233 $ 31,691
<FN>
(a) Net of fees and expenses
waived or borne by the
Adviser which amounted to.. $ 0.021 $ 0.021 $ 0.004 $ 0.001 $ 0.009 $ 0.016
(b) Class B shares were initially offered on August 4, 1992. Per share
amounts reflect activity from that date.
(c) Total return at net asset value assuming all distributions reinvested
and no initial sales charge or contingent deferred sales charge.
(d) Had the Adviser not waived or reimbursed a portion of expenses total
return would have been reduced.
(e) Not annualized.
(f) Includes service fee of 0.12% (annualized) for the period ended July 31,
1995, and 0.02% (not annualized) for the year ended January 31, 1995,
respectively.
(g) Annualized.
</FN>
</TABLE>
21
<PAGE>
SHAREHOLDER SERVICES
TO MAKE INVESTING EASIER
Colonial has one of the most extensive selections of shareholder services
available. Your financial adviser can help you activate any of these services,
or call Colonial directly at 1-800-345-6611.
AFFORDABLE ADDITIONAL INVESTMENTS: Add to your account with as little as $50;
$25 for an IRA account.
FREE EXCHANGES*: Exchange all or part of your account into the same share class
of another Colonial fund, by phone or mail, as your needs change over time.
EASY ACCESS TO YOUR MONEY*: Make withdrawals from your account by phone, by mail
or, for certain funds, by check.
ONE-YEAR REINSTATEMENT PRIVILEGE: If you need access to your money, but then
choose to return it to Colonial within one year, you can reinvest in any
Colonial fund of the same share class without any penalty or sales charge.
FUNDAMATIC: Make periodic investments as low as $50 from your checking account
to your Colonial account.
SYSTEMATIC WITHDRAWAL PLAN (SWP): Receive monthly, quarterly, or semiannual
payments via check or bank transmission. There is a $5,000 account value
required, but no minimum for the payment amount. The maximum annual withdrawal
is 12% of account balance at time SWP is established. SWPs by check are
processed on the 10th of each month.
AUTOMATED DOLLAR COST AVERAGING: Transfer money on a monthly basis from any
Colonial fund with a balance of $5,000 into the same share class of up to four
other Colonial funds. Minimum for each transfer is $100.
LOW COST IRAS: Choose from a broad range of retirement plans, including IRAs.
* Redemptions and exchanges are made at the next determined net asset value
after the request is received by Colonial. Proceeds may be more or less than
your original cost. The exchange privilege may be terminated at any time.
Investors who purchase Class B or Class D shares (for applicable funds), or $1
million or more of Class A shares, may be subject to a contingent deferred sales
charge.
22
<PAGE>
IMPORTANT INFORMATION ABOUT THIS REPORT
The Transfer Agent for Colonial New York Tax-Exempt Fund is:
Colonial Investors Service Center, Inc.
P.O. Box 1722
Boston, MA 02105-1722
1-800-345-6611
Colonial New York Tax-Exempt Fund mails one shareholder report to each
shareholder address. If you would like more than one report, please call our
Literature Department at 1-800-248-2828 and additional reports will be sent to
you.
This report has been prepared for shareholders of Colonial New York Tax-Exempt
Fund. This report may also be used as sales literature when preceded or
accompanied by the current prospectus which provides details of sales charges,
investment objectives and operating policies of the Fund.
23
<PAGE>
COLONIAL
[LOGO] MUTUAL FUNDS
Earning Your Trust For
More Than 60 Years
TRUSTEES
ROBERT J. BIRNBAUM
Trustee (formerly Special Counsel, Dechert, Price & Rhoads; President and Chief
Operating Officer, New York Stock Exchange, Inc.)
TOM BLEASDALE
Trustee (formerly Chairman of the Board and Chief Executive Officer, Shore Bank
& Trust Company)
LORA S. COLLINS
Attorney, Kramer, Levin, Naftalis, Nessen, Kamin & Frankel
JAMES E. GRINNELL
Private Investor (formerly Senior Vice President-Operations,
The Rockport Company)
WILLIAM D. IRELAND, JR.
Trustee (formerly Chairman of the Board, Bank of New England-Worcester)
RICHARD W. LOWRY
Private Investor (formerly Chairman and Chief Executive
Officer, U.S. Plywood Corporation)
WILLIAM E. MAYER
Dean, College of Business and Management, University of Maryland (formerly Dean,
Simon Graduate School of Business, University of Rochester; Chairman and Chief
Executive Officer, C.S. First Boston Merchant Bank; and President and Chief
Executive Officer, The First Boston Corporation)
JOHN A. McNEICE, JR.
Chairman of the Board and Director, The Colonial Group, Inc. and Colonial
Management Associates, Inc. (formerly Chief Executive Officer, The Colonial
Group, Inc. and Colonial Management Associates, Inc.)
JAMES L. MOODY, JR.
Chairman of the Board, Hannaford Bros. Co. (formerly Chief Executive Officer,
Hannaford Bros. Co.)
JOHN J. NEUHAUSER
Dean, Boston College School of Management
GEORGE L. SHINN
Financial Consultant (formerly Chairman, Chief Executive Officer and Consultant,
The First Boston Corporation)
ROBERT L. SULLIVAN
Management Consultant (formerly Management Consultant, Saatchi and Saatchi
Consulting Ltd. and Principal and International Practice Director, Management
Consulting, Peat Marwick Main & Co.)
SINCLAIR WEEKS, JR.
Chairman of the Board, Reed & Barton Corporation
COLONIAL INVESTMENT SERVICES, INC. (C)1995
One Financial Center, Boston, Massachusetts 02111-2621, 617-426-3750
NY-03/193B-0795
Printed on recycled paper
