<PAGE> 1
LIBERTY FLORIDA TAX-EXEMPT FUND SEMIANNUAL REPORT
JULY 31, 2000
[BUILDING GRAPHIC]
<PAGE> 2
PRESIDENT'S MESSAGE
DEAR SHAREHOLDER:
You may have noticed that your Fund has a new name. As of July 14, the names of
our funds were changed to include Liberty. Rest assured, the investment
objectives and strategies employed by the Fund's managers are not affected by
this name change. We believe the new name better reflects your Fund's
affiliation with the Liberty funds, a diverse family of funds representing a
wide selection of investment styles and specialized money management. The goal
of all Liberty funds is to help you reach for financial freedom -- however you
define it.
Although the municipal bond markets exhibited considerable volatility during the
six months ended July 31, 2000,the overall result was positive. As the Federal
Reserve (the Fed) repeatedly raised key short-term interest rates -- by 0.25% in
both February and March and by 0.50% in May -- two things became quite clear.
First, the Fed was concerned that the rapidly expanding U.S. economy could
ignite higher rates of inflation. Second, the Fed was quite determined to snuff
out the sparks before they could become a conflagration.
Initially, the rate increases hurt performance in the municipal bond markets
because as rates rise, bond prices fall. However, the Fed's persistence --
coupled with indications by the second quarter of the calendar year that the
economy may be slowing -- appears to have convinced investors that inflation
will not become a major obstacle to growth in the foreseeable future. Municipal
bond prices rallied in the final two months of the period. Your Fund's
management team had anticipated this scenario for some time, and the Fund was
well positioned to benefit from the rally.
As always, thank you for choosing Liberty Florida Tax-Exempt Fund and for giving
us the opportunity to serve your investment needs.
Respectfully,
/s/ Stephen E. Gibson
Stephen E. Gibson
President
September 11, 2000
Because economic and market conditions change frequently, there can be no
assurance that the trends described in this report will continue or come to
pass.
Not FDIC Insured
May Lose Value
No Bank Guarantee
<PAGE> 3
HIGHLIGHTS
- POSITIVE RESULTS FOR MUNICIPAL BONDS WERE BOLSTERED BY RESTRICTED SUPPLY.
Due to high tax revenues and budget surpluses, state and local governments
issued fewer municipal bonds during the first six months of calendar year
2000. New bond issues were 22% below the 1999 level, and refundings of
existing bonds declined nearly 70%. At the same time, higher yields
prompted an increase in demand for municipal bonds. The combination of
reduced supply and increased demand helped to keep prices for municipal
bonds higher than they might otherwise have been.
- THE MUNICIPAL BOND YIELD CURVE FLATTENED DURING THE SIX-MONTH PERIOD.
Between February and July, yields for short-term municipal bonds declined
slightly (0.10% to 0.20%). Meanwhile, rates for intermediate- and long-term
municipals fell by as much as 0.54% as investors responded to early signs
that the U.S. economy may be slowing and that inflation may not become a
serious problem down the road. As yields fell, bond prices rose, and the
gains were largest for bonds in the 25- to 30-year maturity range.
MUNICIPAL VS. TREASURY BOND PERFORMANCE
1/31/00 - 7/31/00
[LINE GRAPH]
<TABLE>
<CAPTION>
Lehman Brothers Municipal Salomon 30-Year Treasury
Bond Index Bond Index
------------------------- ------------------------
<S> <C> <C>
1/31/00 0% 0%
2/29/00 1.16% 3.7%
3/31/00 3.37% 8.56%
4/30/00 2.76% 7.23%
5/31/00 2.22% 7.02%
6/30/00 4.93% 9.36%
7/31/00 6.4% 11.48%
</TABLE>
Past performance is no indication of future results.
Performance of municipal bonds is illustrated by the Lehman Brothers Municipal
Bond Index, a broad-based, unmanaged index that tracks the performance of the
municipal bond market. Performance of the 30-Year Treasury bond is illustrated
by the Salomon 30-Year Treasury Bond Index, a broad-based, unmanaged index that
tracks the performance of the 30-year-on-the-run Treasury market. Unlike mutual
funds, indexes are not investments and do not incur fees or expenses. It is not
possible to invest directly in an index.
NET ASSET VALUE PER SHARE AS OF 7/31/00
<TABLE>
<S> <C>
Class A $7.32
Class B $7.32
Class C $7.32
</TABLE>
DISTRIBUTIONS DECLARED
FROM 2/1/00 TO 7/31/00
<TABLE>
<S> <C>
Class A $0.180
Class B $0.153
Class C $0.164
</TABLE>
A portion of the Fund's income may be subject to the alternative minimum tax.
The Fund may at times purchase tax-exempt securities at a discount. Some or all
of this discount may be included in the Fund's ordinary income, and is taxable
when distributed.
SEC YIELDS ON 7/31/00
<TABLE>
<S> <C>
Class A 4.61%
Class B 4.07%
Class C 4.38%
</TABLE>
The 30-day SEC yields reflect the portfolio's earning power, net of expenses,
expressed as an annualized percentage of the public offering price at the end of
the period. If the Advisor or its affiliates had not waived certain Fund
expenses, the SEC yield would have been 4.46% for Class A shares, 3.92% for
Class B shares, and 3.92% for Class C shares.
TAXABLE-EQUIVALENT SEC YIELDS
ON 7/31/00
<TABLE>
<S> <C>
Class A 7.63%
Class B 6.74%
Class C 7.25%
</TABLE>
Taxable-equivalent SEC yields are based on the maximum effective 39.6% federal
income tax rate. This tax rate does not reflect the phaseout of exemptions or
the reduction of otherwise allowable deductions that occur when Adjusted Gross
Income exceeds certain levels.
1
<PAGE> 4
PORTFOLIO MANAGER'S REPORT
QUALITY BREAKDOWN AS OF 7/31/00
<TABLE>
<S> <C>
AAA 60.7%
AA 15.1%
A 5.6%
BBB 3.9%
B 1.0%
Nonrated 11.9%
Cash equivalents 1.8%
</TABLE>
Quality breakdowns are calculated as a percentage of total investments,
including short-term obligations. Ratings shown in the quality breakdowns
represent the highest rating assigned to a particular bond by one of the
following respected rating agencies: Standard & Poor's Corporation, Moody's
Investors Service, Inc., or Fitch Investors Service, Inc.
Because the Fund is actively managed, there can be no guarantee the Fund will
continue to maintain these quality breakdowns in the future.
BOUGHT/SOLD
As part of our efforts to lengthen the Fund's duration and improve its credit
quality, we divested uninsured (BBB-rated) Puerto Rico general obligation bonds
due in 2014 and replaced them with insured (AAA-rated) Puerto Rico finance bonds
due in 2017 (2.3% of net assets).
RISING LONG-TERM BOND PRICES CONTRIBUTED TO MODEST BUT SOLID GAINS FOR THE FUND
Against a backdrop of falling yields and rising prices for intermediate- and
long-term municipal bonds, Class A Shares of Liberty Florida Tax-Exempt Fund
posted a total return of 6.45% without a sales charge for the six months ended
July 31, 2000. We are pleased with this result, which reflects not only the
general trend in the market but the effectiveness of our investment strategy.
THE FUND SHIFTED EMPHASIS TO BETTER LONG-TERM POSITIONING
In the second half of the fiscal year ended January 31, 2000, we chose to
shorten the Fund's duration. This move was designed to insulate the Fund from
the impact of rising interest rates, which generally lead to lower bond prices.
By February of this year, we were convinced that the market would ultimately
come to view the Fed's interest rate hikes as an effective, preemptive strike
against higher inflation. In a lower inflation-rate environment, investors would
not demand higher yields, so we expected more moderate interest rates to prevail
in the long run. Falling rates, of course, mean rising prices for bonds.
With this scenario in mind, we began lengthening the Fund's duration in
February, purchasing primarily securities in the 15- to 17-year maturity range.
Following additional "preemptive strikes" against inflation in February, March
and May, investors did indeed take the pressure off bond yields. The bond market
rallied, and the Fund performed quite well.
As part of our long-term strategy, we also improved the Fund's call protection.
We sold bonds that had relatively short time periods remaining before they could
be called for redemption by the issuers and purchased issues with longer
call-protection periods. Bonds with shorter call protection generally gain less
as interest rates fall.
REAL ESTATE BONDS BOOSTED YIELD
High-yield and nonrated bonds did not rally as much as higher-quality municipal
bonds during the six-month period, but they continued to be relatively
inexpensive to buy and provided very attractive yields -- in some cases, as much
as 1.6% more than comparable investment-grade bonds. For this reason, we
purchased a small number of property tax bonds backed by new real estate
developments in Florida. Adding them to the portfolio enhanced both its overall
diversification and its yield potential.
2
<PAGE> 5
PORTFOLIO MANAGER'S REPORT (CONTINUED)
FLORIDA'S ECONOMY REMAINED BUOYANT
The economic and fiscal situations in Florida continued to be encouraging. Job
growth was high, and unemployment rates continued to fall. Tourism, a major
contributor to the economy, was booming, while real estate, also an important
economic driver, seems to have been only slightly effected by higher interest
rates.
SIGNS OF A POSITIVE ENVIRONMENT FOR BONDS ARE GROWING
Our outlook for the municipal bond market has improved considerably. As the
six-month period came to a close, we had already seen the first signs of more
temperate U.S. economic growth, including a reduction in new housing starts and
softening of retail sales. Slower growth could set the stage for lower interest
rates in 12 to 15 months. We believe the Fund is well positioned should that
occur.
We are equally positive in our outlook for Florida. The fiscal situation is
quite stable. And, although we anticipate a slight moderation in economic
growth, we believe that Florida will remain one of the nation's most robust
economies. That, in turn, should lead to more tax revenues and lessen the need
for state and local governments to issue new bonds. The reduced supply, combined
with strong demand from investors, may give the Florida municipal bond market a
further boost. We would not be surprised if it outperformed the national average
in the second half of 2000.
/s/ David Pope
DAVID POPE is portfolio manager of Liberty Florida Tax-Exempt Fund and is a vice
president of Colonial Management Associates, Inc. (CMA).
Tax-exempt investing offers current tax-free income but also involves certain
risks. The value of the Fund will be affected by interest rate changes and the
creditworthiness of the issues held in the Fund. The Fund's management,
including risk management specialists and credit analysts, identifies problems
and opportunities and reacts quickly to market changes.
TOP FIVE SECTOR BREAKDOWN 7/31/00 VS. 1/31/00
[BAR CHART]
<TABLE>
<CAPTION>
7/31/00 1/31/00
------- -------
<S> <C> <C>
Hospital 12.8% 7.4%
Municipal Electric 12.5% 11.4%
Special Property Tax 10.5% 11.3%
Single-Family 10.4% 9.8%
Water & Sewer 8.8% 8.3%
</TABLE>
Sector breakdowns are calculated as a percentage of total net assets.
Because the Fund is actively managed, there can be no guarantee the Fund will
continue to maintain these sector breakdowns in the future.
3
<PAGE> 6
PERFORMANCE INFORMATION
AVERAGE ANNUAL TOTAL RETURNS AS OF 7/31/00
<TABLE>
<CAPTION>
Share Class A B C
Inception 2/1/93 2/1/93 8/1/97
----------------------------------------------------------------------------------------------
Without With Sales Without With Sales Without With Sales
Sales Charge Charge Sales Charge Charge Sales Charge Charge
----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
6 month
(cumulative) 6.45% 1.39% 6.05% 1.05% 6.21% 5.21%
1 year 2.75 (2.13) 1.98 (2.91) 2.29 1.31
5 years 5.26 4.24 4.48 4.14 4.66 4.66
Life 5.04 4.36 4.26 4.26 4.38 4.38
</TABLE>
AVERAGE ANNUAL TOTAL RETURNS AS OF 6/30/00
<TABLE>
<CAPTION>
Share Class A B C
----------------------------------------------------------------------------------------------
Without With Sales Without With Sales Without With Sales
Sales Charge Charge Sales Charge Charge Sales Charge Charge
----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
6 month
(cumulative) 4.23% (0.72)% 3.83% (1.17)% 3.99% 2.99%
1 year 1.74 (3.10) 0.98 (3.87) 1.28 0.31
5 years 5.16 4.14 4.38 4.04 4.55 4.55
Life 4.92 4.23 4.14 4.14 4.26 4.26
</TABLE>
Past performance cannot predict future results. Returns and value of an
investment will vary resulting in a gain or loss on sale. All results shown
assume reinvestment of distributions. The "with sales charge" returns include
the maximum 4.75% sales charge for Class A shares, the appropriate Class B
shares contingent deferred sales charge for the holding period after purchase as
follows: through first year -- 5%, second year -- 4%, third year -- 3%, fourth
year -- 3%, fifth year -- 2%, sixth year -- 1%, thereafter -- 0% and the Class C
shares contingent deferred sales charge of 1% for the first year only.
Performance for different share classes will vary based on differences in sales
charges and fees associated with each class.
Performance results reflect any voluntary waivers or reimbursements of Fund
expenses by the Advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Class C share performance information includes returns of the Fund's Class B
shares (the oldest existing Fund class with a similar expense structure) for
periods prior to its inception date. These Class B share returns are not
restated to reflect any expense differential (e.g. Rule 12b-1 fees) between
Class B and Class C shares.
4
<PAGE> 7
INVESTMENT PORTFOLIO
July 31, 2000 (Unaudited)
(In thousands)
<TABLE>
<CAPTION>
MUNICIPAL BONDS - 97.3% PAR VALUE
--------------------------------------------------------------------------------
<S> <C> <C>
EDUCATION - 2.7%
EDUCATION
Pinellas County Educational
Facilities Authority,
Barry University Project, Series 1998,
5.375% 10/1/23 $1,000 $ 940
PR Commonwealth of Puerto Rico,
Industrial Tourist, Educational,
Medical & Environmental Facilities,
Ana G. Mendez University,
5.375% 2/1/19 275 255
------
1,195
------
--------------------------------------------------------------------------------
HEALTHCARE - 14.2%
CONGREGATE CARE RETIREMENT - 0.9%
Lee County Industrial Development Authority,
Shell Point Village Project,
Series 1999 A:
5.500% 11/1/29 250 194
5.750% 11/15/15 250 216
------
410
------
HOSPITAL - 12.8%
Cape Canaveral Hospital District,
Series 1998,
5.250% 1/1/18 500 405
Jacksonville Health Facilities Authority,
National Benevolent Association,
Series 2000 A,
7.100% 3/1/30 250 248
Miami Beach Health Facilities Authority,
Mt. Sinai Medical Center of Florida,
Series 1998,
5.375% 11/15/28 500 387
Orange County Health Facilities Authority,
Orlando Regional Healthcare System:
Series 1999,
6.000% 10/1/26 500 483
Series 1996 A,
6.250% 10/1/16 3,000 3,295
Tampa, H. Lee Moffitt Cancer Center,
Series 1999 A,
5.750% 7/1/29 1,000 912
------
5,730
------
NURSING HOME - 0.5%
Collier County Industrial
Development Authority,
Beverly Enterprises, Inc., Series 1991,
10.750% 3/1/03 115 121
Escambia County,
Beverly Enterprises-Florida, Inc.,
Series 1985,
9.800% 6/1/11 105 109
------
230
------
--------------------------------------------------------------------------------
HOUSING - 14.4%
MULTI-FAMILY - 4.0%
Broward County Housing
Finance Authority:
Cross Keys Apartments,
Series 1998 A,
5.750% 10/1/28 1,000 925
Chaves Lake Apartment Project,
Series 2000,
7.500% 7/1/40 250 252
Clay County Housing Finance Authority,
Madison Commons Apartments,
Series 2000 A,
7.450% 7/1/40 250 251
Orange County Housing Finance Authority,
Palms at Brentwood Apartments,
Series 1998 K,
6.500% 12/1/34 250 221
State Housing Fince Corp.,
Sunset Place Apartments,
Series 1999 K,
6.000% 10/1/19 150 145
------
1,794
------
SINGLE FAMILY - 10.4%
Broward County Housing Finance
Authority,
Series 1995,
6.700% 2/1/28 1,220 1,267
Lee County Housing Finance Authority,
Series 1998 A,
6.300% 3/1/29 970 990
Manatee County Housing
Finance Authority,
Series 1996-1,
7.450% 5/1/27 1,470 1,594
Miami-Dade County,
Series 1999 A,
5.550% 10/1/19 500 483
Orange County Housing Finance
Authority, Series 1999 A,
6.250% 9/1/28 300 306
------
4,640
------
</TABLE>
See notes to investment portfolio.
5
<PAGE> 8
INVESTMENT PORTFOLIO (CONTINUED)
July 31, 2000 (Unaudited)
(In thousands)
<TABLE>
<CAPTION>
MUNICIPAL BONDS (CONTINUED) PAR VALUE
--------------------------------------------------------------------------------
<S> <C> <C>
INDUSTRIAL - 1.0%
FOOD PRODUCTS
Hendry County Industrial Development
Authority, Savannah Foods & Industries,
Series 1992,
6.400% 3/1/17 $ 500 $ 427
------
--------------------------------------------------------------------------------
OTHER - 4.6%
POOL/BOND BANK - 0.7%
State Municipal Loan Council,
Series 2000 A,
(a) 4/1/21 1,000 304
------
REFUNDED/ESCROWED (b) - 3.9%
Clearwater Housing Authority,
Hampton Apartments,
Series 1994,
8.250% 5/1/24 567 646
Seminole County,
Series 1992,
6.000% 10/1/19 1,030 1,094
------
1,740
------
--------------------------------------------------------------------------------
RESOURCE RECOVERY - 2.4%
RESOURCE RECOVERY
Palm Beach County Solid Waste Authority,
Series 1998 A,
(a) 10/1/12 2,000 1,053
------
--------------------------------------------------------------------------------
TAX-BACKED - 27.4%
LOCAL APPROPRIATED - 2.4%
Hillsborough County School Board,
Series 1998 A,
5.500% 7/1/16 1,060 1,078
------
SPECIAL NON-PROPERTY TAX - 4.9%
Jacksonville, Excise Tax,
Series 1993,
(a) 10/1/09 525 328
Tampa Sports Authority,
Tampa Bay Arena Project,
Series 1995,
5.750% 10/1/25 1,500 1,547
Tampa Utility Tax,
Series 1996,
(a) 4/1/21 1,000 306
------
2,180
------
SPECIAL PROPERTY TAX - 10.5%
Fleming Island Plantation
Community Development
District, Series 2000 A,
6.300% 2/1/05 250 250
Heritage Palms Community Development
District, Series 1999,
6.250% 11/1/04 400 399
Heritage Springs Community
Development District:
Series 1999 A,
6.750% 5/1/21
6.250% 5/1/05 255 254
Indigo Community Development District,
Series 1999 B,
6.400% 5/1/06 300 299
Lexington Oaks Community
Development District,
Series 1998 A,
6.125% 5/1/19 585 554
Maple Ridge Community
Development District,
Series 2000,
7.150% 5/1/31 200 200
Northern Palm Beach County
Improvement District,
Series 1999,
6.000% 8/1/29 500 451
Orlando, Conroy Road Interchange Project:
Series 1998 A,
5.800% 5/1/26 500 443
Series 1998 B,
5.250% 5/1/05 190 183
Stoneybrook Community
Development District:
Series 1998 A,
6.100% 5/1/19 250 235
Series 1998 B,
5.700% 5/1/08 300 291
Village Center Community
Development District,
Series 1998 A,
5.500% 11/1/12 1,000 1,042
------
4,698
------
STATE APPROPRIATED - 3.8%
State Department of Corrections,
Okeechobee Correctional Installation,
Series 1995,
6.250% 3/1/15 625 666
PR Commonwealth of Puerto Rico
Public Finance Corp.,
Series 1998 A,
5.375% 6/1/17 1,000 1,013
------
1,678
------
STATE GENERAL OBLIGATIONS - 5.8%
State Board of Education,
Series 1992 A,
6.400% 6/1/19 2,500 2,595
------
</TABLE>
See notes to investment portfolio.
6
<PAGE> 9
INVESTMENT PORTFOLIO (CONTINUED)
<TABLE>
<CAPTION>
PAR VALUE
--------------------------------------------------------------------------------
<S> <C> <C>
TRANSPORTATION - 7.0%
AIRPORT - 2.3%
Dade County, Miami International
Airport, Series 1992 B,
6.600% 10/1/22 $1,000 $1,053
-------
PORTS - 4.7%
Dade County Seaport:
Series 1995,
6.200% 10/1/09 1,000 1,102
Series 1996,
5.400% 10/1/21 1,000 977
-------
2,079
-------
--------------------------------------------------------------------------------
UTILITY - 23.6%
INVESTOR OWNED - 2.3%
Citrus County, Florida Power Corp.,
Crystal River Power Plant, Series 1992 A,
6.625% 1/1/27 1,000 1,043
-------
MUNICIPAL ELECTRIC - 12.5%
Fort Pierce Utilities Authority,
Series 1999 B,
(a) 10/1/17 1,000 381
Lakeland,
Series 1999 C,
6.050% 10/1/11 1,870 2,043
Orlando Utilities Commission,
Series 1989 D,
6.750% 10/1/17 (c) 2,750 3,152
-------
5,576
-------
WATER & SEWER - 8.8%
Dade County Water & Sewer,
Series 1997,
5.250% 10/1/21 1,000 963
Seacoast Utility Authority,
Series 1989 A,
5.500% 3/1/15 1,900 1,948
Seminole County,
Series 1992,
6.000% 10/1/19 470 503
Tampa Bay,
6.267% 10/1/29 500 509
-------
3,922
-------
TOTAL MUNICIPAL BONDS
(cost of $43,288)(d) 43,425
-------
SHORT-TERM OBLIGATIONS - 1.8%
--------------------------------------------------------------------------------
VARIABLE RATE DEMAND NOTES (e)
IL State Development Finance Authority,
Ulich Children's Home Project,
4.250% 4/1/07 600 600
IN State Health Facilities Financing
Authority, Series 2000,
4.250% 1/12/20 200 200
-------
800
-------
OTHER ASSETS & LIABILITIES NET- 0.9% 395
--------------------------------------------------------------------------------
NET ASSETS - 100.0% $44,620
=======
</TABLE>
NOTES TO INVESTMENT PORTFOLIO:
--------------------------------------------------------------------------------
(a) Zero coupon bond.
(b) 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.
(c) These securities, or a portion thereof, with a total market value of
$1,375, are being used to collateralize open futures contracts.
(d) Cost for federal income tax purposes is the same.
(e) 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, 2000.
Long futures contracts open at July 31, 2000:
<TABLE>
<CAPTION>
Par value Unrealized
covered by Expiration appreciation
Type contracts month at 7/31/00
---- --------- ----- ----------
<S> <C> <C> <C>
Treasury Note $1,200 September $39
</TABLE>
See notes to investment portfolio.
7
<PAGE> 10
STATEMENT OF ASSETS AND LIABILITIES
July 31, 2000 (Unaudited)
(In thousands except for per share amounts and footnotes)
<TABLE>
<S> <C> <C>
ASSETS
Investments at value (cost $43,288) $ 43,425
Short-term obligations 800
--------
44,225
Receivable for:
Interest $ 746
Expense reimbursement
due from Advisor 20
Other 11 777
-------- --------
Total Assets 45,002
LIABILITIES
Payable for:
Investments purchased 201
Fund shares repurchased 62
Distributions 61
Accrued:
Management fee 19
Transfer agent fee 5
Bookkeeping fee 2
Deferred Trustees fees 4
Other 28
--------
Total Liabilities 382
--------
NET ASSETS $ 44,620
========
Net asset value & redemption price per share --
Class A ($23,369/3,191) 7.32(a)
========
Maximum offering price per share --
Class A ($7.32/0.9525) 7.69(b)
========
Net asset value & offering price per share --
Class B ($20,855/2,849) 7.32(a)
========
Net asset value & offering price per share --
Class C ($396/54) 7.32(a)
========
COMPOSITION OF NET ASSETS
Capital paid in $ 46,348
Overdistributed net investment income (11)
Accumulated net realized loss (1,893)
Net unrealized appreciation on:
Investments 137
Open futures contracts 39
--------
$ 44,620
========
</TABLE>
(a) Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
(b) On sales of $50,000 or more the offering price is reduced.
STATEMENT OF OPERATIONS
For the Six Months Ended July 31, 2000 (Unaudited)
(In thousands)
<TABLE>
<S> <C> <C>
INVESTMENT INCOME
Interest $ 1,333
-------
EXPENSES
Management fee $ 113
Service fee 44
Distribution fee -- Class B 81
Distribution fee -- Class C 2
Transfer agent 33
Bookkeeping fee 14
Trustees fee 4
Custodian fee 2
Audit fee 17
Legal fee 3
Registration fee 8
Reports to shareholders 6
Other 4
-------
Total expenses 331
Fees waived by the Advisor (34)
Fees waived by the Distributor -- Class C (1)
Custodian credits earned (2) 294
------- -------
Net Investment Income 1,039
-------
NET REALIZED & UNREALIZED GAIN (LOSS) ON
PORTFOLIO POSITIONS
Net realized gain (loss) on:
Investments (431)
Closed futures contracts 33
-------
Net Realized Loss (398)
Net change in unrealized appreciation/depreciation
during the period on:
Investments 2,099
Open futures contracts 25
-------
Net Change in Unrealized
Appreciation/Depreciation 2,124
-------
Net Gain 1,726
-------
Increase in Net Assets from Operations $ 2,765
=======
</TABLE>
See notes to financial statements.
8
<PAGE> 11
STATEMENT OF CHANGES IN NET ASSETS
(In thousands)
<TABLE>
<CAPTION>
(UNAUDITED)
SIX MONTHS
ENDED YEAR ENDED
JULY 31, JANUARY 31,
INCREASE (DECREASE) IN NET ASSETS 2000 2000
--------------------------------------------------------------------------------
<S> <C> <C>
Operations:
Net investment income $ 1,039 $ 2,275
Net realized loss (398) (341)
Net change in unrealized appreciation/
depreciation 2,124 (5,627)
-------- --------
Net Increase (Decrease) from Operations 2,765 (3,693)
Distributions:
From net investment income -- Class A (581) (1,218)
From net investment income -- Class B (458) (1,008)
From net investment income -- Class C (7) (15)
-------- --------
1,719 (5,934)
-------- --------
Fund Share Transactions:
Receipts for shares sold -- Class A 1,175 3,264
Value of distributions reinvested -- Class A 261 529
Cost of shares repurchased -- Class A (2,964) (6,336)
-------- --------
(1,528) (2,543)
-------- --------
Receipts for shares sold -- Class B 560 3,150
Value of distributions reinvested -- Class B 149 345
Cost of shares repurchased -- Class B (2,855) (9,281)
-------- --------
(2,146) (5,786)
-------- --------
Receipts for shares sold -- Class C 200 40
Value of distributions reinvested -- Class C 1 8
Cost of shares repurchased -- Class C (173) --
-------- --------
28 48
-------- --------
Net Decrease from Fund
Share Transactions (3,646) (8,281)
-------- --------
Total Decrease (1,927) (14,215)
NET ASSETS
Beginning of period 46,547 60,762
-------- --------
End of period (net of overdistributed
net investment income of $11 and
$4, respectively) $ 44,620 $ 46,547
======== ========
</TABLE>
<TABLE>
<CAPTION>
(UNAUDITED)
SIX MONTHS
ENDED YEAR ENDED
JULY 31, JANUARY 31,
NUMBER OF FUND SHARES 2000 2000
--------------------------------------------------------------------------------
<S> <C> <C>
Sold -- Class A 164 447
Issued for distributions reinvested -- Class A 36 71
Repurchased -- Class A (415) (854)
-------- --------
(215) (336)
-------- --------
Sold -- Class B 77 430
Issued for distributions reinvested --
Class B 21 47
Repurchased -- Class B (396) (1,245)
-------- --------
(298) (768)
-------- --------
Sold -- Class C 28 5
Issued for distributions reinvested --
Class C (a) 1
Repurchased -- Class C (24) --
-------- --------
4 6
-------- --------
</TABLE>
(a) Rounds to less than one.
See notes to financial statements.
9
<PAGE> 12
NOTES TO FINANCIAL STATEMENTS
July 31, 2000 (Unaudited)
NOTE 1. INTERIM FINANCIAL STATEMENTS
In the opinion of management of Liberty Florida Tax-Exempt Fund (formerly
Colonial Florida Tax Exempt Fund) (the Fund), a series of Liberty 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, 2000, 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's investment objective is to seek as
high a level of after-tax total return as is consistent with prudent risk by
pursuing current income exempt from federal income tax. The Fund also provides
opportunities for long-term appreciation from a portfolio primarily invested in
investment grade municipal bonds. The Fund may issue an unlimited number of
shares. The Fund offers three classes of shares: Class A, Class B and Class C.
Class A shares are sold with a front-end sales charge. A 1.00% contingent
deferred sales charge is assessed to Class A shares purchased without an initial
sales charge on redemptions made within eighteen months on an original purchase
of $1 million to $25 million. Class B shares are subject to an annual
distribution fee and a contingent deferred sales charge. Class B shares will
convert to Class A shares in three, four, or eight years after purchase,
depending on the program under which shares were purchased. Class C shares are
subject to a contingent deferred sales charge on redemptions made within one
year after purchase and an annual distribution fee.
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 revenues and expenses during the reporting period.
Actual results could differ from those estimates. The following is a summary of
significant accounting policies that are consistently followed by the Fund in
the preparation of its financial statements.
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 for which market quotations are not readily available are
valued at fair value under procedures approved by the Trustees.
Security transactions are accounted for on the date the securities are
purchased, sold or mature.
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 and Class C distribution fees) and
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 and Class C per share data and ratios are calculated by adjusting the
expense and net investment income per share data and ratios for the Fund for the
entire period by the distribution fee applicable to Class B and Class C 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. Reclassifications are made to the Fund's capital accounts
to reflect income and gains available for distribution (or available capital
loss carryforwards) under income tax regulations.
NOTE 3. FEES AND COMPENSATION PAID TO AFFILIATES
MANAGEMENT FEE:
Colonial Management Associates, Inc. (the Advisor) is the investment Advisor of
the Fund and furnishes accounting and other services and office facilities for a
monthly fee based on the Fund's pro-rata portion of the combined average net
assets of the funds constituting Trust V as follows:
<TABLE>
<CAPTION>
AVERAGE NET ASSETS ANNUAL FEE RATE
-------------------------------------------------------------------------------
<S> <C>
First $2 billion 0.50%
Over $2 billion 0.45%
</TABLE>
10
<PAGE> 13
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
BOOKKEEPING FEE:
The Advisor provides bookkeeping and pricing services for a monthly fee equal to
$27,000 annually plus 0.035% annually of the Fund's average net assets over $50
million.
TRANSFER AGENT FEE:
Liberty Funds Services, Inc. (the Transfer Agent), an affiliate of the Advisor,
provides shareholder services for a monthly fee comprised of 0.07% annually of
average net assets plus charges based on the number of shareholder accounts and
transactions and receives reimbursement for certain out-of-pocket expenses.
UNDERWRITING DISCOUNTS, SERVICE AND DISTRIBUTION FEES:
Liberty Funds Distributor, Inc. (the Distributor), a subsidiary of the Advisor
is the Fund's principal underwriter. For the six months ended July 31, 2000, the
Fund has been advised that the Distributor retained net underwriting discounts
of $6,176 on sales of the Fund's Class A shares and received contingent deferred
sales charges (CDSC) of $2, $27,573 and none on Class A, Class B and Class C
share redemptions, respectively.
The Fund has adopted a 12b-1 plan which requires the payment of a monthly
service fee to the Distributor. The fee is calculated by adding (1) 0.10% of the
net assets attributable to shares issued prior to November 30, 1994 and (2)
0.25% on net assets attributable to shares issues thereafter. This arrangement
results in a rate of service fee payable by the Fund that is a blend between the
0.10% and 0.25% rates. For the six months ended July 31, 2000, the Fund's
service fee was 0.19%.
The plan also requires the payment of a monthly distribution fee to the
Distributor equal to 0.75% annually of the Fund's average net assets
attributable to Class B and Class C shares. The Distributor has voluntarily
agreed to waive a portion of the Class C distribution fee so that it will not
exceed 0.45% annually.
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 Advisor 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 0.75% annually of the Fund's average net assets.
OTHER:
The Fund pays no compensation to its officers, all of whom are employees of the
Advisor.
The Fund's Trustees may participate in a deferred compensation plan which maybe
terminated at any time. Obligations of the plan will be paid solely out of the
Fund's assets.
The Fund has an agreement with the custodian bank under which custodian fees
were reduced by balance credits of $1,803 applied during the six months ended
July 31, 2000. The Fund could have reinvested a portion of the assets utilized
in connection with the expense offset arrangements in an income producing asset
if it had not entered into such an agreement.
NOTE 4. PORTFOLIO INFORMATION
INVESTMENT ACTIVITY:
For the six months ended July 31, 2000, purchases and sales of investments,
other than short-term obligations, were $7,039,148 and $11,414,467,
respectively.
Unrealized appreciation (depreciation) at July 31, 2000,based on cost of
investments for both financial statement and federal income tax purposes was
approximately:
<TABLE>
<S> <C>
Gross unrealized appreciation $1,122,000
Gross unrealized depreciation (985,000)
----------
Net unrealized appreciation $ 137,000
----------
</TABLE>
CAPITAL LOSS CARRYFORWARDS:
At January 31, 2000, capital loss carryforwards available (to the extent
provided in regulations) to offset future realized gains were approximately as
follows:
<TABLE>
<CAPTION>
YEAR OF EXPIRATION CAPITAL LOSS CARRYFORWARD
------------------ -------------------------
<S> <C>
2004 $ 511,000
2005 41,000
2008 683,000
----------
$1,235,000
----------
</TABLE>
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 may purchase or sell municipal and Treasury bond futures contracts and
purchase and write options on futures. The Fund will invest in these instruments
to hedge against the effects of changes in the value of portfolio securities due
to anticipated changes in interest rates and/or market conditions, for duration
management, or when the transactions are economically appropriate to the
reduction of risk inherent in the management of the Fund and not for trading
purposes. The use of futures contracts and options involves certain risks, which
include (1) imperfect correlation between the price movement of the instruments
and the underlying securities, (2) inability to close out a position due to
different trading hours, or the temporary absence of a liquid market for either
the instrument or the underlying securities or (3) an inaccurate prediction by
the Advisor of the future direction of interest rates. Any of these risks may
involve amounts exceeding the amount recorded in the Fund's Statement of Assets
and Liabilities at any given time.
11
<PAGE> 14
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 5. LINE OF CREDIT
The Fund may borrow up to 33 1/3% of its net assets under a line of credit for
temporary or emergency purposes. Any borrowings bear interest at one of the
following options determined at the inception of the loan: (1) federal funds
rate plus 1/2 of 1%, (2) the lending bank's base rate or (3) IBOR offshore loan
rate plus 1/2 of 1%. There were no borrowings under the line of credit during
the six months ended July 31, 2000.
12
<PAGE> 15
FINANCIAL HIGHLIGHTS
Selected data for a share of each class outstanding throughout each period are
as follows:
<TABLE>
<CAPTION>
(UNAUDITED)
SIX MONTHS ENDED JULY 31, 2000
-------------------------------------
CLASS A CLASS B CLASS C
---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 7.050 $ 7.050 $ 7.050
------- ------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (a)(b) 0.179 0.152 0.162(c)
Net realized and unrealized gain 0.271 0.271 0.271
------- ------- -------
Total from Investment Operations 0.450 0.423 0.433
------- ------- -------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS:
From net investment income (0.180) (0.153) (0.164)
======= ======= =======
NET ASSET VALUE, END OF PERIOD $ 7.320 $ 7.320 $ 7.320
======= ======= =======
Total return (d)(e)(f) 6.45% 6.05% 6.21%
======= ======= =======
RATIOS TO AVERAGE NET ASSETS
Expenses (g)(h) 0.94% 1.69% 1.39%(c)
Net investment income (g)(h) 4.98% 4.23% 4.53%(c)
Fees waived or borne by the Advisor (g)(h) 0.15% 0.15% 0.15%
Portfolio turnover 18% 18% 18%
Net assets at end of period (000) $23,369 $20,855 $ 396
(a) Net of fees and expenses waived or borne
by the Advisor which amounted to: $ 0.005 $ 0.005 $ 0.005
</TABLE>
(b) The per share net investment income amounts do not reflect the periods
reclassification of differences between book and tax basis net
investment income.
(c) Net of fees waived by the Distributor which amounted to $0.011 per
share and 0.30% (annualized).
(d) Total return at net asset value assuming all distributions reinvested
and no initial sales charge or contingent deferred sales charge.
(e) Had the Advisor and Distributor not waived or reimbursed a portion of
expenses, total return would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements had no impact.
(h) Annualized.
13
<PAGE> 16
FINANCIAL HIGHLIGHTS (CONTINUED)
Selected data for a share of each class outstanding throughout each period are
as follows:
<TABLE>
<CAPTION>
YEAR ENDED JANUARY 31, 2000
-------------------------------------
CLASS A CLASS B CLASS C
---------------------------------------------------------------------------------------
<S> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 7.890 $ 7.890 $ 7.890
------- ------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (a)(b) 0.349 0.293 0.316(c)
Net realized and unrealized loss (0.844) (0.844) (0.844)
------- ------- -------
Total from Investment Operations (0.495) (0.551) (0.528)
------- ------- -------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS:
From net investment income (0.345) (0.289) (0.312)
======= ======= =======
NET ASSET VALUE, END OF PERIOD $ 7.050 $ 7.050 $ 7.050
======= ======= =======
Total return (d)(e) (6.39)% (7.10)% (6.82)%
======= ======= =======
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 0.94% 1.69% 1.39%(c)
Net investment income (f) 4.68% 3.93% 4.23%(c)
Fees waived or borne by the Advisor (f) 0.09% 0.09% 0.09%
Portfolio turnover 33% 33% 33%
Net assets at end of period (000) $24,011 $22,183 $ 353
(a) Net of fees and expenses waived or
borne by the Advisor which amounted to: $ 0.007 $ 0.007 $ 0.007
</TABLE>
(b) The per share net investment income amounts do not reflect the periods
reclassification of differences between book and tax basis net
investment income.
(c) Net of fees waived by the Distributor which amounted to $0.022 per
share and 0.30%.
(d) Total return at net asset value assuming all distributions reinvested
and no initial sales charge or contingent deferred sales charge.
(e) Had the Advisor and Distributor not waived or reimbursed a portion of
expenses, total return would have been reduced.
(f) The benefits derived from custody credits and directed brokerage
arrangements had an impact of 0.01% and $0.001 per share.
<TABLE>
<CAPTION>
YEAR ENDED JANUARY 31, 1999
-----------------------------------------------------
CLASS A CLASS B CLASS C
-------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 7.790 $ 7.790 $ 7.790
------- ------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (a) 0.356 0.296 0.320(b)
Net realized and unrealized gain 0.119 0.119 0.119
------- ------- -------
Total from Investment Operations 0.475 0.415 0.439
------- ------- -------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS:
From net investment income (0.366) (0.307) (0.331)
In excess of net investment income (0.009) (0.008) (0.008)
======= ======= =======
Total Distributions Declared to Shareholders (0.375) (0.315) (0.339)
======= ======= =======
NET ASSET VALUE, END OF PERIOD $ 7.890 $ 7.890 $ 7.890
======= ======= =======
Total return (c)(d) 6.29% 5.48% 5.80%
======= ======= =======
RATIOS TO AVERAGE NET ASSETS
Expenses (e) 0.82% 1.57% 1.27%(b)
Net investment income (e) 4.59% 3.84% 4.14%(b)
Fees waived or borne by the Advisor (e) 0.17% 0.17% 0.17%
Portfolio turnover 50% 50% 50%
Net assets at end of period (000) $29,526 $30,891 $ 345
(a) Net of fees and expenses waived or borne
by the Advisor which amounted to: $ 0.013 $ 0.013 $ 0.013
</TABLE>
(b) Net of fees waived by the Distributor which amounted to $0.023 per
share and 0.30%.
(c) Total return at net asset value assuming all distributions reinvested
and no initial sales charge or contingent deferred sales charge.
(d) Had the Advisor and Distributor not waived or reimbursed a portion of
expenses, total return would have been reduced.
(e) The benefits derived from custody credits and direct brokerage
arrangements had an impact of 0.01% and $0.001 per share.
14
<PAGE> 17
FINANCIAL HIGHLIGHTS (CONTINUED)
Selected data for a share of each class outstanding throughout each period are
as follows:
<TABLE>
<CAPTION>
YEARS ENDED JANUARY 31
----------------------------------------------------------------------------
1998 1997 1996
----------------------------- ------------------- -------------------
CLASS A CLASS B CLASS C(b) CLASS A CLASS B CLASS A CLASS B
------- -------- -------- ------- ------- --------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 7.430 $ 7.430 $ 7.710 $ 7.620 $ 7.620 $ 7.100 $ 7.100
------- -------- -------- ------- ------- --------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (a) 0.388 0.332 0.172(c) 0.395 0.340 0.404 0.351
Net realized and unrealized gain (loss) 0.361 0.361 0.082 (0.194) (0.194) 0.535 0.533
------- -------- -------- ------- ------- --------- -------
Total from Investment Operations 0.749 0.693 0.254 0.201 0.146 0.939 0.884
------- -------- -------- ------- ------- --------- -------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS:
From net investment income (0.389) (0.333) (0.174) (0.391) (0.336) (0.419) (0.364)
------- -------- -------- ------- ------- --------- -------
NET ASSET VALUE, END OF PERIOD $ 7.790 $ 7.790 $ 7.790 $ 7.430 $ 7.430 $ 7.620 $ 7.620
------- -------- -------- ------- ------- --------- -------
Total return (d)(e) 10.37% 9.55% 3.35%(f) 2.80% 2.03% 13.55% 12.72%
======= ======== ======== ======= ======= ========= =======
RATIOS TO AVERAGE NET ASSETS
Expenses (g) 0.59% 1.34% 1.04%(c) 0.56% 1.31% 0.45% 1.18%
Interest expense -- -- -- (i) (i) -- --
Net investment income (g) 5.08% 4.33% 4.63%(c) 5.31% 4.56% 5.45% 4.72%
Fees waived or borne by the Advisor (g) 0.41% 0.41% 0.40%(h) 0.44% 0.44% 0.55% 0.55%
Portfolio turnover 32% 32% 32% 69% 69% 83% 83%
Net assets at end of period (000) $32,150 $33,665 $ 103 $31,275 $33,341 $32,599 $35,741
(a) Net of fees and expenses waived or borne by
the Advisor which amounted to: $ 0.031 $ 0.031 $ 0.031 $ 0.032 $ 0.032 $ 0.040 $ 0.040
</TABLE>
(b) Class C shares were initially offered on August 1, 1997. Per share data
reflects activity from that date.
(c) Net of fees waived by the Distributor which amounted to $0.012 per
share and 0.30% (annualized).
(d) Total return at net asset value assuming all distributions reinvested
and no initial sales charge or contingent deferred sales charge.
(e) Had the Advisor and Distributor not waived or reimbursed a portion of
expenses, total return would have been reduced.
(f) Not annualized.
(g) In 1998,the benefits derived from custody credits and directed
brokerage arrangements had an impact of 0.01% and $0.001 per share.
(h) Annualized.
(i) Rounds to less than 0.01%.
15
<PAGE> 18
TRUSTEES & TRANSFER AGENT
TOM BLEASDALE
Retired (formerly Chairman of the Board and Chief Executive Officer, Shore Bank
& Trust Company)
LORA S. COLLINS
Attorney (formerly Attorney, Kramer, Levin, Naftalis & Frankel)
JAMES E. GRINNELL
Private Investor (formerly Senior Vice President - Operations, The Rockport
Company)
RICHARD W. LOWRY
Private Investor (formerly Chairman and Chief Executive Officer, U.S. Plywood
Corporation)
SALVATORE MACERA
Private Investor (formerly Executive Vice President of Itek Corp. and President
of Itek Optical & Electronic Industries, Inc.)
WILLIAM E. MAYER
Partner, Park Avenue Equity Partners (formerly Dean, College of Business and
Management, University of Maryland; Dean, Simon Graduate School of
Business, University of Rochester; Chairman and Chief Executive Officer, CS
First Boston Merchant Bank; and President and Chief Executive Officer, The First
Boston Corporation)
JAMES L. MOODY, JR.
Retired (formerly Chairman of the Board, Chief Executive Officer and
Director, Hannaford Bros. Co.)
JOHN J. NEUHAUSER
Academic Vice President and Dean of Faculties, Boston College (formerly
Dean, Boston College School of Management)
JOSEPH R. PALOMBO
Chief Operations Officer, Mutual Funds, Liberty Financial Companies, Inc.,
Executive Vice President and Director of Colonial Management Associates, Inc.
and Executive Vice President and Chief Administrative Officer of Liberty Funds
Group LLC (formerly Vice President of Liberty Funds Group - Boston and Chief
Operating Officer, Putnam Mutual Funds)
THOMAS E. STITZEL
Business Consultant and Chartered Financial Analyst (formerly Professor of
Finance, College of Business, Boise State University)
ANNE-LEE VERVILLE
Consultant (formerly General Manager, Global Education Industry, and
President, Applications Solutions Division, IBM Corporation)
IMPORTANT INFORMATION ABOUT THIS REPORT
The Transfer Agent for Liberty Florida Tax-Exempt Fund is:
Liberty Funds Services, Inc.
P.O. Box 1722
Boston, MA 02105-1722
1-800-345-6611
The Fund mails one shareholder report to each shareholder address. If you would
like more than one report, please call 1-800-426-3750 and additional reports
will be sent to you.
This report has been prepared for shareholders of Liberty Florida 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 and with the
most recent copy of the Liberty Funds Performance Update.
SEMIANNUAL REPORT:
LIBERTY FLORIDA TAX-EXEMPT FUND
<PAGE> 19
CHOOSE LIBERTY
BECAUSE NO SINGLE INVESTMENT MANAGER CAN BE ALL THINGS TO ALL INVESTORS.(SM)
[LIBERTY FUNDS LOGO]
ALL-STAR Institutional money management approach for individual
investors.
COLONIAL Fixed income and value style equity investing.
CRABBE
HUSON A contrarian approach to fixed income and equity
investing.
NEWPORT A leader in international investing.(SM)
STEIN ROE
ADVISOR Innovative solutions for growth and income investing.
[KEYPORT LOGO] A leading provider of innovative annuity products.
Liberty's mutual funds are offered by prospectus through Liberty Funds
Distributor, Inc.
BEFORE YOU INVEST, CONSULT YOUR FINANCIAL ADVISOR.
Your financial advisor can help you develop a long-term plan for reaching your
financial goals.
LIBERTY FLORIDA TAX-EXEMPT FUND SEMIANNUAL REPORT
---------------
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U.S. POSTAGE
Liberty Funds Distributor, Inc. (c)2000 PAID
One Financial Center, Boston, MA 02111-2621, 1-800-426-3750 HOLLISTON, MA
www.libertyfunds.com PERMIT NO. 20
---------------
788-03/388C-0700 (9/00) 00/1562
