<PAGE>
ROBERTSON STEPHENS MUTUAL FUNDS
The Information Age Fund-TM-
Annual Report
December 31, 1997
[GRAPHIC]
INFORMATION AGE
4
<PAGE>
THE INFORMATION AGE FUND-TM- ANNUAL REPORT
January 30, 1998
FELLOW SHAREHOLDER:
First I want to thank you for being a shareholder in the Robertson Stephens
Funds. All of us here appreciate your support.
As you probably already know, 1997 was an outstanding year for most
categories of equity investing with the notable exception of stocks of Asian
companies. The year also brought very high market volatility especially in
shares of smaller companies, but investors who stayed the course were well
rewarded. Yet as I review the timing and level of redemptions out of our
fund complex and other fund complexes, I am acutely aware that many investors
do not stay the course, and instead sell during market declines worrying that
the market will go even lower. An important study done in 1997 by an
independent consulting group (DALBAR, Inc.) studying mutual fund investors
from 1984-1996 concluded that the average investor in equity mutual funds had
given up between 1/3 to 2/3 of available returns by selling at the wrong
times and reinvesting after the market had significantly recovered. This
slippage in performance is very significant and obviously needs to be
avoided. Developing a financial plan and sticking to it are the centerpieces
for achieving expected returns.
We have put some free tools in place for your convenience to help an investor
stay the course or just stay up to date with fund activity. First, the
portfolio managers of each fund regularly update a recorded message. These
"hotline" messages are accessible for current investors through our toll free
number (1-800-766-3863) and our Web site (www.rsim.com) and are updated
especially during times of significant market volatility. Additionally, we
also conduct monthly conference calls with our portfolio managers and provide
detailed quarterly summaries on each of our equity mutual funds, all of which
can also be accessed on our Web site.
Over the past few years we have introduced several funds that have the
objective of global investing. In 1998 we plan to introduce a new fund - a
broadly diversified large-cap international fund that is designed to be a
core holding. This fund will seek to outperform the benchmark indexes through
the application of an investment discipline based on Economic Value Added
(EVA). This methodology focuses on studying the level of incremental returns
on capital that companies can earn with their free cash flow. Though we
have successfully used EVA analysis for years in some of our funds, this is a
little used methodology in the mutual fund industry. We believe this
methodology sets us apart and that our technological advances help to give
our portfolio managers an edge in picking winning stocks. We are quite
enthusiastic about this future fund offering.
At Robertson Stephens Funds we continually work on making our investment
process better to pursue the goal of outstanding risk adjusted rates of
return. One of the areas we focused on in 1997 and will continue to focus on
in the future is the use of technologies that help us become better
investors. In that regard we added several new exciting technology tools in
1997. As very significant shareholders of our own funds we look forward to
seeking excellent returns with you in 1998 and beyond. We believe in the old
adage of "Eating your own cooking."
If you have any questions or suggestions please drop me a note or send me an
E-mail message.
Again, thank you for your support.
/s/ G. Randy Hecht
- ------------------
G. RANDY HECHT
President
Robertson Stephens Funds
[email protected]
Information contained herein relating to the new international fund is
subject to completion or amendment. A registration statement relating to the
fund's securities has been filed with the Securities and Exchange Commission.
The fund's securities may not be sold nor may offers to buy be accepted
prior to the time the registration statement becomes effective. This letter
shall not constitute an offer to sell or the solicitation of an offer to buy
nor shall there be any sale of the fund's securities in any state in which
such offer, solicitation, or sale would be unlawful prior to registration or
qualification under the securities laws of any such state. A prospectus
regarding the new fund is available from BancAmerica Robertson Stephens; an
investor should read that prospectus carefully before investing.
<PAGE>
FUND HIGHLIGHTS
ACQUISITION
BankAmerica Corporation's acquisition of Robertson, Stephens &
Company became effective October 1, 1997. The investment management activity
for both organizations has been placed under the leadership of Randy Hecht,
President of Robertson Stephens Investment Management (RSIM) since 1989. We
believe this is a strong commitment to honor the unique culture which remains
at the heart of RSIM's success, and we look forward to the ability to expand
our global capabilities and resources as a result of this partnership.
CO-PORTFOLIO MANAGER
Effective October 1, 1997, Rod Berry, an analyst for the The Information Age
Fund-TM- since its inception, was named co-portfolio manager of the Fund and
now manages with Ron Elijah.
FUND PHILOSOPHY
The Information Age Fund-TM- seeks to achieve long-term capital appreciation
by aggressively investing in companies primarily within the information
technology sector.
CONTENTS
Fund Highlights 1
Report to Shareholders 2
Fund Performance - Class A Shares 6
Portfolio Summary 7
Fund Performance - Class C Shares 8
Schedule of Investments 9
Statement of Assets and Liabilities 11
Statement of Operations 12
Statement of Changes in Net Assets 13
Financial Highlights - Class A Shares 14
Financial Highlights - Class C Shares 15
Notes to Financial Statements 16
Report of Independent Accountants 20
Administration 20
1
<PAGE>
[PHOTO]
FUND MANAGERS
RONALD E. ELIJAH
RODERICK R. BERRY
The Information Age Fund-TM-
DEAR SHAREHOLDER:
The Information Age Fund-TM- (Class A) had a fourth quarter return of -21.73%
compared to -13.57% for the PSE Technology Index and 2.90% for the S&P 500
Index. For the one-year period ended December 31, 1997, the Fund was up 6.15%
compared to 19.97% for the PSE Technology Index and 33.34% for the S&P 500
Index. The Fund's Class C shares had a fourth quarter return of -23.10% and
- -10.44% since their inception on July 11, 1997.
During the year, the technology sector's performance, as measured by the PSE
Technology Index, was highly concentrated in a handful of outperforming
stocks. This concentration contributed greatly to the Index's returns. The
six stocks which accounted for approximately 10% of the Index's weighting
contributed more than 30% of the technology sector's overall performance.
These six stocks were Microsoft Corp., Dell Computer Corp., Compaq Computer
Corp., Lucent Technologies Inc., IBM, and Hewlett Packard Co. Although we
had large holdings in three of the six companies, our concentration in these
stocks was not enough to offset the general underperformance of small- and
mid-cap technology stocks during the year. For the year, less than one-third
of technology stocks outperformed the PSE Technology Index.
"As we enter 1998, we are ENCOURAGED by a U.S. economy that remains on a
course of LOW INFLATION and slow growth."
2
<PAGE>
IMPACT OF THE ASIAN ECONOMIC CRISIS
Much of the fourth quarter underperformance by technology stocks can be
attributed to the spreading economic crisis in Southeast Asia. Although we
recognize the importance of the unfolding events, we believe that the
sell-off in technology stocks has been overdone. The uncertainty created by
the region's problems has resulted in the indiscriminant selling of
technology stocks regardless of Asian exposure.
To put the situation in perspective, the U.S. presently exports about $200
billion to Southeast Asia or approximately 2.8% of the $7.2 trillion U.S.
economy. Most economists agree that the Asian crisis could slow U.S. GDP
growth by 20 to 50 basis points over the next two years, a relatively small
impact.
Asia's problems will impact the various segments of the technology sector
differently. At present, worldwide software demand is being driven by the
United States and Europe as the Internet continues to expand and companies
upgrade their current IT infrastructure to be able to compete more
efficiently. We believe that Southeast Asian exposure is also very limited
for the domestic personal computer manufacturers, accounting for a 15% share
of worldwide PC unit shipments. Lost revenue opportunity in this region
should, in many cases, be more than offset by a lower cost structure.
Michael Dell recently stated that the Asian crisis would impact less than 10%
of Dell Computer's revenue, but would result in lower component costs for 70%
of their sourced components.
Asian semiconductor consumption is approximately 22% of total semiconductor
consumption with the Southeast Asian countries of Indonesia, Malaysia,
Thailand and the Philippines accounting for 5% of worldwide semiconductor
consumption. As with the PC industry, we believe that cost savings resulting
from the Asian currency devaluations will more than offset any revenue
shortfalls. In the semiconductor equipment area, U.S. companies derive an
average of 30% of revenues from Southeast Asia. We believe that the
continued profitability of Southeast Asia's non-memory manufacturing
facilities combined with U.S. and European direct investment in the region
will continue to spur demand.
In the wireless equipment area, only 5% of total sales were derived from
Indonesia, Malaysia, Thailand and the Philippines in 1997. The greatest
growth prospects remain in China which has seen no slowdown in demand.
However, recent slowdowns in Japan and Korea, two of the world's largest
wireless markets, have had a negative impact on growth rates.
3
<PAGE>
LONG-TERM DEMAND FOR TECHNOLOGY
The Information Age Fund was originally created to take advantage of what we
saw as the exploding worldwide demand for technology products and services.
Initially, the U.S. led the way in technology adoption. Although the U.S.
makes up only 5% of the world's population, and 26% of the world's total GDP,
we account for a disproportionate 40% of all technology spending. By
employing technology in increasing amounts, U.S. corporations have enhanced
their competitive positions both domestically and globally through increased
productivity.
As Europe continues to recover, we are seeing indications that technology
spending is once again beginning to accelerate in the region as companies
push to compensate for years of low spending. With 88% of the world's
population accounting for only 21% of the $557 billion of technology spending
worldwide, the rest of the world remains a largely untapped opportunity for
expanding growth in technology.
During 1997 several important milestones were reached in the technology
sector. The Internet continued its unprecedented growth as America Online
reported that they have grown to over ten million worldwide subscribers.
WorldCom, the largest carrier of Internet traffic, reported that the traffic
on the information super highway is growing so rapidly that they are required
to double the capacity of their infrastructure every 3.6 months.
The demand for basic voice telephony service is also witnessing unprecedented
growth as developing nations with less than ten phone lines per 100 people
build basic infrastructure. During this past year, China installed the
equivalent of a Regional Bell Operating Company consisting of over 15 million
lines. Even at this rate of expansion, it will take China decades to
approach the density we have in the U.S. Deregulation in developed countries
also continues to play an important role in the growth of the communications
sector. In the U.S., new competitors continue to enter the long-distance and
local telephone markets, driving down the cost of voice and data services.
Looking ahead, 1998 will be the year of deregulation for Europe's
communications industry which will further drive down the cost of
communications.
[PHOTO]
INVESTMENT MANAGEMENT
G. RANDY HECHT
President
Robertson Stephens Funds
[email protected]
INVESTMENT TEAM
RESEARCH
Susan Richardson
Rob Zidar
TRADING
Bill Reinsberg
SENIOR TRADER
Catherine O'Neill
ADMINISTRATION
Keira Koziol
Annette Tate
4
<PAGE>
Moore's law continued to be the rule in 1997 as the transistor density of
microprocessors kept pace with the historic norm of doubling every two years.
PC manufacturers offered Pentium 100MHz, 630MB drive systems for under
$1,000 and consumers responded with strong holiday buying, thus opening a
new, incremental market. PCs also sold well in the business area as
companies continued the migration from legacy systems to client server
architectures. This migration was made even more compelling in 1997 with
Intel's new Pentium Pro microprocessor and Microsoft's NT networking and
client operating system. With worldwide PC penetration significantly below
the level of the United States, strong growth opportunities remain going
forward.
Licenses to offer wireless service continued to be auctioned off in the U.S.
as well as other regions, such as Latin America, ensuring continued growth
opportunities for wireless technology companies. Exiting 1997 with over 200
million wireless subscribers, we believe the industry will have 600 million
wireless subscribers by the year 2002.
1998 OUTLOOK
As we enter 1998, we are encouraged by a U.S. economy that remains on a
course of low inflation and slow growth. This, combined with cheaper imports
out of Asia, should keep interest rates down with an increasing possibility
of gradually declining rates throughout the year.
Based on our research, the valuations of the technology sector relative to
inflation and long-term interest rates are near an all-time low. Just as in
1990, 1994 and 1996, we are coming out of a 20% correction in the technology
sector which has created a tremendous investment opportunity as we enter
1998. As we move through the new year, we expect the uncertainties
surrounding Asia to moderate, and we also expect a strengthening Europe to
offset much of the negative impact from Asia. Over the last ten years, we
have seen severe technology corrections followed by strong rallies,
approximately six months on average. Our fundamental analysis gives us
confidence that 1998 will not be an exception.
We believe that 1998 will be a strong year led by an extremely undervalued
semiconductor equipment sector, which has been negatively impacted by fears
of Asian exposure. We also expect the lagging small and mid-cap stocks to
participate as Asian market uncertainties dissipate and software, personal
computer, semiconductor and communications companies produce strong earnings.
The entire Information Age Fund team thanks you for your continued support.
Sincerely,
/s/ Ronald E. Elijah /s/ Roderick R. Berry
RONALD E. ELIJAH RODERICK R. BERRY
Portfolio Managers
January 29, 1998
TO HEAR OUR ONGOING THOUGHTS ON THE FUND, CALL OUR PORTFOLIO MANAGER HOTLINE
AT 1-800-766-3863.
5
<PAGE>
FUND PERFORMANCE - CLASS A SHARES
Results of a hypothetical $10,000 investment in The Information Age Fund-TM-,
the PSE Technology Index(1), and the S&P 500 Index(2)
IF INVESTED ON NOVEMBER 15, 1995(3)
[GRAPH]
<TABLE>
<CAPTION>
CUMULATIVE TOTAL RETURNS
INFORMATION AGE PSE TECHNOLOGY S&P 500
FOR THE PERIOD ENDED 12/31/97 FUND INDEX(1) INDEX(2)
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Since inception (11/15/95)(3) 25.09% 41.40% 70.53%
- ----------------------------------------------------------------------------------------------------
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
INFORMATION AGE PSE TECHNOLOGY S&P 500
FOR THE PERIOD ENDED 12/31/97 FUND INDEX(1) INDEX(2)
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
One year 6.15% 19.97% 33.34%
- ----------------------------------------------------------------------------------------------------
Since inception (11/15/95)(3) 11.09% 17.67% 28.50%
- ----------------------------------------------------------------------------------------------------
</TABLE>
(1) The Pacific Stock Exchange ("PSE") Technology Index is an unmanaged,
price-weighted index of the top 100 U.S. technology stocks. You cannot
invest in an index itself.
(2) The Standard & Poor's Composite Index of 500 Stocks ("S&P 500 Index") is a
widely recognized, unmanaged index of market activity based on the
aggregate performance of a selected portfolio of publicly traded stocks. It
is widely recognized as representative of the stock market in general.
Investment results assume the reinvestment of dividends paid on the stocks
constituting the index. You cannot invest in an index itself.
(3) Date that the Fund's Class A shares were first issued to the public.
Investors should realize that all performance data presented is based upon
past performance during limited periods of time, and that past performance is
no guarantee of future performance. Investors should also realize that both
investment return and principal value will fluctuate so that shares, when
redeemed, may be worth more or less than their original cost. The correlation
of performance between an unmanaged index and this Fund is not usually exact.
International investing can involve greater currency fluctuations and less
political and economic stability. Investing in smaller companies can involve
more volatility, less liquidity, and less publicly available information.
Short selling is the sale of a borrowed security and the price of the
security can increase between the date the security is sold and the date when
the fund must replace it. Options and futures may not be perfectly correlated
to the underlying index or security. Investing in a particular sector can
involve greater market fluctuation.
6
<PAGE>
PORTFOLIO SUMMARY
AS OF DECEMBER 31, 1997
[CHART]
Cash & Cash Equivalents 1.3%
Financial Services 1.0%
Medical Services 1.0%
Electronic Components 2.5%
Contract Manufacturing 2.6%
Commercial Services 6.2%
Communications & Communications Equipment 7.3%
Computer Hardware & Components 13.2%
Other & Other Liabilities Net 0.7%
Computer Software & Services 27.8%
Semiconductor Equipment 19.2%
Semiconductors 17.2%
TOP TEN HOLDINGS
1.
COMPAQ COMPUTER CORPORATION (3.68%)
Designs, develops, manufactures, and markets personal computers for
professional users and consumers.
2.
PEOPLESOFT, INC. (3.61%)
Provides software for business solutions. The company develops, markets and
supports enterprise solutions for accounting, materials management,
distribution, supply chain planning and human resources.
3.
DELL COMPUTER CORPORATION (3.49%)
Produces and sells personal computers. Also sells third-party software and
peripherals.
4.
AMERICA ONLINE, INC. (3.38%)
Offers subscribers a wide variety of interactive services including
electronic mail, "Instant Message" features, entertainment, reference,
financial information, computing support, interactive magazines and
newspapers.
5.
APOLLO GROUP, INC., CLASS A (3.18%)
Provides educational services. The company operates campuses and learning
centers nationwide and in Puerto Rico and England.
6.
APPLIED MATERIALS, INC. (3.04%)
Develops, manufactures, sells, and services semiconductor wafer fabrication
equipment worldwide.
7.
COMPUTER LEARNING CENTERS, INC. (3.01%)
Provides information and computer-related education and training. The
company designs programs and courses to meet current information technology
education needs, offering instructions in client/server, databases,
networking, and object-oriented programming.
8.
WIND RIVER SYSTEMS, INC. (3.00%)
Provides integrated software development tools for real-time embedded
applications. The company's customers include the Internet,
telecommunications, data communications, office automation, medical,
automotive, industrial, aerospace and multimedia markets worldwide.
9.
MAXIM INTEGRATED PRODUCTS, INC. (2.90%)
Designs, develops, manufactures and markets a broad range of linear and
mixed-signal integrated circuits. The company also provides a range of
high-frequency design processes.
10.
ASM LITHOGRAPHY HOLDING (2.84%)
Develops, manufactures, markets and services semiconductor equipment,
including advanced photolithography projection systems, known as "wafer
steppers."
7
<PAGE>
FUND PERFORMANCE - CLASS C SHARES
Results of a hypothetical $10,000 investment in The Information Age Fund-TM-,
the PSE Technology Index(1), and the S&P 500 Index(2)
IF INVESTED ON JULY 11, 1997(3)
[GRAPH]
<TABLE>
<CAPTION>
CUMULATIVE TOTAL RETURNS
INFORMATION AGE INFORMATION AGE PSE TECHNOLOGY S&P 500
FOR THE PERIOD ENDED 12/31/97 FUND FUND(4) INDEX(1) INDEX(2)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Since inception (7/11/97)(3) (9.53)% (10.44)% (5.49)% 6.77%
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The Pacific Stock Exchange ("PSE") Technology Index is an unmanaged,
price-weighted index of the top 100 U.S. technology stocks. You cannot
invest in an index itself.
(2) The Standard & Poor's Composite Index of 500 Stocks ("S&P 500 Index") is a
widely recognized, unmanaged index of market activity based on the
aggregate performance of a selected portfolio of publicly traded stocks. It
is widely recognized as representative of the stock market in general.
Investment results assume the reinvestment of dividends paid on the stocks
constituting the index. You cannot invest in an index itself.
(3) Date that the Fund's Class C shares were first issued to the public.
(4) Reflects the 1% contingent deferred sales charge imposed on redemptions
within the first year of purchasing shares.
Investors should realize that all performance data presented is based upon
past performance during limited periods of time, and that past performance is
no guarantee of future performance. Investors should also realize that both
investment return and principal value will fluctuate so that shares, when
redeemed, may be worth more or less than their original cost. The correlation
of performance between an unmanaged index and this Fund is not usually exact.
International investing can involve greater currency fluctuations and less
political and economic stability. Investing in smaller companies can involve
more volatility, less liquidity, and less publicly available information.
Short selling is the sale of a borrowed security and the price of the
security can increase between the date the security is sold and the date when
the fund must replace it. Options and futures may not be perfectly correlated
to the underlying index or security. Investing in a particular sector can
involve greater market fluctuation.
8
<PAGE>
SCHEDULE OF INVESTMENTS
<TABLE>
<CAPTION>
DECEMBER 31, 1997 SHARES VALUE
- --------------------------------------------------------------------------------
COMMON STOCKS
- --------------------------------------------------------------------------------
<S> <C> <C>
COMMUNICATIONS - 5.3%
Burr-Brown Corporation 83,700 $ 2,688,863
Digital Microwave Corporation 100,000 1,450,000
Tellabs, Inc. 40,000 2,115,000
- --------------------------------------------------------------------------------
6,253,863
- --------------------------------------------------------------------------------
COMMERCIAL SERVICES - 6.2%
Apollo Group, Inc., Class A 80,000 3,780,000
Computer Learning Centers, Inc. 58,500 3,583,125
- --------------------------------------------------------------------------------
7,363,125
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
COMMUNICATIONS EQUIPMENT - 2.0%
Cisco Systems, Inc. 42,300 2,358,225
- --------------------------------------------------------------------------------
2,358,225
- --------------------------------------------------------------------------------
COMPUTER HARDWARE & COMPONENTS - 13.2%
Adaptec, Inc. 65,000 2,413,125
Compaq Computer Corporation(1) 77,500 4,373,906
Dell Computer Corporation 49,400 4,149,600
Gateway 2000, Inc. 50,000 1,631,250
Sanmina Corporation 144A(2) 46,000 3,116,500
- --------------------------------------------------------------------------------
15,684,381
- --------------------------------------------------------------------------------
COMPUTER SOFTWARE & SERVICES - 27.8%
America Online, Inc. 45,000 4,013,438
BMC Software, Inc. 33,500 2,198,438
Cadence Design Systems, Inc. 100,000 2,450,000
Check Point Software Technologies, Ltd. 45,000 1,833,750
Citrix Systems, Inc. 40,000 3,040,000
Compuware Corporation 86,600 2,771,200
Legato Systems, Inc. 58,000 2,552,000
Manugistics Group, Inc. 30,000 1,338,750
Microsoft Corporation 17,700 2,287,725
PeopleSoft, Inc. 110,000 4,290,000
Wind River Systems, Inc. 90,000 3,571,875
Yahoo! Inc. 40,000 2,770,000
- --------------------------------------------------------------------------------
33,117,176
- --------------------------------------------------------------------------------
CONTRACT MANUFACTURING - 2.6%
Solectron Corporation 75,000 3,117,187
- --------------------------------------------------------------------------------
3,117,187
- --------------------------------------------------------------------------------
ELECTRONIC COMPONENTS - 2.5%
Micrel, Inc. 105,000 2,940,000
- --------------------------------------------------------------------------------
2,940,000
- --------------------------------------------------------------------------------
FINANCIAL SERVICES - 1.0%
AmeriTrade Holding Corporation, Class A 40,000 1,170,000
- --------------------------------------------------------------------------------
1,170,000
- --------------------------------------------------------------------------------
MEDICAL SERVICES - 1.0%
HBO & Company(1) 25,000 1,200,000
- --------------------------------------------------------------------------------
1,200,000
- --------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
9
<PAGE>
SCHEDULE OF INVESTMENTS (CONTINUED)
<TABLE>
<CAPTION>
DECEMBER 31, 1997
- --------------------------------------------------------------------------------
<S> <C> <C>
SEMICONDUCTOR EQUIPMENT - 19.2%
Applied Materials, Inc. 120,000 $ 3,615,000
ASM Lithography Holding 50,000 3,375,000
Asyst Technologies, Inc. 70,000 1,522,500
KLA-Tencor Corporation 65,000 2,510,625
Lam Research Corporation 60,000 1,755,000
Novellus Systems, Inc. 96,000 3,102,000
PRI Automation, Inc. 52,200 1,507,275
Photronics, Inc. 120,000 2,910,000
Teradyne, Inc. 80,000 2,560,000
- --------------------------------------------------------------------------------
22,857,400
- --------------------------------------------------------------------------------
SEMICONDUCTORS - 17.2%
Advanced Semiconductor Engineering, Inc. 40,000 2,615,000
Intel Corporation 38,700 2,718,675
Lattice Semiconductor Corporation 30,000 1,421,250
Level One Communications, Inc. 75,000 2,118,750
Linear Technology Corporation(1) 50,000 2,881,250
Maxim Integrated Products, Inc. 100,000 3,450,000
Semtech Corporation 20,700 809,887
Vitesse Semiconductor Corporation 88,600 3,344,650
Xilinx Semiconductor, Inc. 30,000 1,051,875
- --------------------------------------------------------------------------------
20,411,337
- --------------------------------------------------------------------------------
TELECOMMUNICATIONS - 0.9%
QUALCOMM, Inc. 22,600 1,141,300
- --------------------------------------------------------------------------------
1,141,300
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TOTAL INVESTMENTS - 98.9% (Cost $104,217,648) 117,613,994
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS
- --------------------------------------------------------------------------------
Cash 516
Repurchase Agreement
State Street Bank & Trust Company, 5.30%,
dated 12/31/97, due 1/2/98, maturity value
$1,490,439 (collateralized by $1,400,000
par value U.S. Treasury Note, 7.875%, due 11/15/07) 1,490,000
- --------------------------------------------------------------------------------
TOTAL CASH AND CASH EQUIVALENTS - 1.3% 1,490,516
- --------------------------------------------------------------------------------
OTHER LIABILITIES, NET - (0.2%) (193,161)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TOTAL NET ASSETS - 100.0% $118,911,349
- --------------------------------------------------------------------------------
</TABLE>
(1) Income-producing security.
(2) These securities may be resold in transactions exempt from registration
under Rule 144A of the Securities Act of 1933, normally to qualified
institutional buyers.
The accompanying notes are an integral part of these financial statements.
10
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
DECEMBER 31, 1997
- --------------------------------------------------------------------------------
ASSETS
- --------------------------------------------------------------------------------
<S> <C>
Investments, at value (Cost: $104,217,648) $117,613,994
Cash and cash equivalents 1,490,516
Receivable for investments sold 1,566,038
Receivable for fund shares subscribed 2,462,739
Organization cost 19,853
Dividends/interest receivable 6,104
- --------------------------------------------------------------------------------
TOTAL ASSETS 123,159,244
- --------------------------------------------------------------------------------
LIABILITIES
- --------------------------------------------------------------------------------
Payable for investments purchased 1,495,000
Payable for fund shares redeemed 2,544,908
Accrued expenses 106,760
Payable to adviser 101,227
- --------------------------------------------------------------------------------
TOTAL LIABILITIES 4,247,895
- --------------------------------------------------------------------------------
TOTAL NET ASSETS $118,911,349
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NET ASSETS CONSIST OF:
- --------------------------------------------------------------------------------
Paid-in capital 113,833,553
Accumulated net realized loss from investments (8,318,550)
Net unrealized appreciation on investments 13,396,346
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TOTAL NET ASSETS $118,911,349
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
PRICING OF SHARES:
Net Asset Value, offering, and redemption price
per share - Class A Share $ 11.80
(Net assets of $118,831,970 applicable to
10,069,291 shares of beneficial interest
outstanding with no par value)
- --------------------------------------------------------------------------------
Net Asset Value, offering, and redemption
price per share - Class C Shares $ 11.67
(Net assets of $79,379 applicable to 6,800
shares of beneficial interest
outstanding with no par value)(1)
- --------------------------------------------------------------------------------
</TABLE>
(1) Redemption price per share is equal to the net asset value less any
applicable contingent deferred sales charge.
The accompanying notes are an integral part of these financial statements.
11
<PAGE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31, 1997
- --------------------------------------------------------------------------------
INVESTMENT INCOME
- --------------------------------------------------------------------------------
<S> <C>
Interest $ 94,428
Dividends 40,265
- --------------------------------------------------------------------------------
TOTAL INVESTMENT INCOME 134,693
- --------------------------------------------------------------------------------
EXPENSES
- --------------------------------------------------------------------------------
Investment advisory fees 1,234,823
Administrative expense 308,706
Distribution fees - Class A Shares 308,650
Transfer agent fees 108,963
Custodian fees 84,577
Registration and filing fees 53,834
Professional fees 49,505
Interest expense 35,045
Shareholder reports 31,060
Trustees' fees and expenses 22,265
Organization expense 6,515
Insurance 1,938
Distribution fees - Class C Shares 167
Shareholder servicing fees - Class C Shares 55
- --------------------------------------------------------------------------------
TOTAL EXPENSES 2,246,103
- --------------------------------------------------------------------------------
NET INVESTMENT LOSS (2,111,410)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
REALIZED GAIN/(LOSS) AND UNREALIZED
APPRECIATION/(DEPRECIATION) ON INVESTMENTS
- --------------------------------------------------------------------------------
Net realized loss from investments (6,023,505)
Net change in unrealized appreciation on investments 8,110,368
- --------------------------------------------------------------------------------
TOTAL NET REALIZED LOSS AND UNREALIZED
APPRECIATION ON INVESTMENTS 2,086,863
- --------------------------------------------------------------------------------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS $ (24,547)
- --------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
12
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE FOR THE
YEAR ENDED YEAR ENDED
12/31/97 12/31/96
- ----------------------------------------------------------------------------------------------------
OPERATIONS
- ----------------------------------------------------------------------------------------------------
<S> <C> <C>
Net investment loss $ (2,111,410) $ (1,326,228)
Net realized (loss)/gain from investments (6,023,505) 8,016,897
Net change in unrealized appreciation on investments 8,110,368 5,030,392
- ----------------------------------------------------------------------------------------------------
NET (DECREASE)/INCREASE IN NET ASSETS RESULTING FROM OPERATIONS (24,547) 11,721,061
- ----------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
- ----------------------------------------------------------------------------------------------------
Net investment income - Class A shares - -
Net investment income - Class C shares(1) - -
Realized gain on investments - Class A shares (4,383,105) (2,483,271)
Realized gain on investments - Class C shares(1) (2,817) -
- ----------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS (4,385,922) (2,483,271)
- ----------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
- ----------------------------------------------------------------------------------------------------
Net increase in net assets resulting from capital share transactions 17,057,946 64,200,446
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
TOTAL INCREASE IN NET ASSETS 12,647,477 73,438,236
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
NET ASSETS
- ----------------------------------------------------------------------------------------------------
Beginning of year 106,263,872 32,825,636
End of year $ 118,911,349 $106,263,872
- ----------------------------------------------------------------------------------------------------
</TABLE>
(1) Class C shares were first issued on July 11, 1997.
The accompanying notes are an integral part of these financial statements.
13
<PAGE>
FINANCIAL HIGHLIGHTS - CLASS A SHARES
<TABLE>
<CAPTION>
FOR THE FOR THE FOR THE
FOR A SHARE OUTSTANDING YEAR ENDED YEAR ENDED PERIOD ENDED
THROUGHOUT EACH PERIOD: 12/31/97 12/31/96 12/31/95(1)(2)
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 11.51 $ 9.30 $ 10.00
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
Net investment loss (0.22) (0.20) (0.01)
Net realized gain/(loss) and net change in unrealized appreciation/(depreciation)
on investments and securities sold short 0.95 2.68 (0.69)
- ---------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Net Assets Resulting From Operations 0.73 2.48 (0.70)
- ---------------------------------------------------------------------------------------------------------------------------------
Distributions from net investment income - - -
Distributions from realized gain on investments (0.44) (0.27) -
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 11.80 $ 11.51 $ 9.30
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN 6.15% 26.72% (7.00)%
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ---------------------------------------------------------------------------------------------------------------------------------
Net Assets, end of period (000's) $ 118,832 $ 106,264 $ 32,826
Ratio of Expenses to Average Net Assets 1.82% 2.03% 2.13%
Ratio of Net Investment Loss to Average Net Assets (1.71)% (1.85)% (0.89)%
Portfolio Turnover Rate 369% 452% 89%
Average Commission Rate Paid(3) $ 0.0602 $ 0.0582 -
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Class A shares were first issued on November 15, 1995.
(2) Ratios, except for total return and portfolio turnover rate, have been
annualized.
(3) A fund is required to disclose its average commission rate per share for
security trades on which a commission is charged. This amount may vary from
fund to fund and period to period depending on the mix of trades executed
in various markets where trading practices and commission rate structures
may differ. This rate generally does not reflect markups, markdowns or
spreads on shares traded on a principal basis, if any.
Per-share data with respect to Class A shares for each period has been
determined by using the average number of Class A shares outstanding
throughout each period. Distributions reflect actual per-share amounts
distributed for the period.
The accompanying notes are an integral part of these financial statements.
14
<PAGE>
FINANCIAL HIGHLIGHTS - CLASS C SHARES
<TABLE>
<CAPTION>
FOR THE
FOR A SHARE OUTSTANDING PERIOD ENDED
THROUGHOUT THE PERIOD: 12/31/97(1)
- ----------------------------------------------------------------------------------------------------
<S> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 13.36
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
Net investment loss (0.20)
Net realized gain/(loss) and net change in unrealized appreciation/(depreciation)
on investments and securities sold short(2) (1.05)
- ----------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Net Assets Resulting From Operations (1.25)
- ----------------------------------------------------------------------------------------------------
Distributions from net investment income -
Distributions from realized gain on investments (0.44)
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 11.67
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
TOTAL RETURN (9.53)%
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ----------------------------------------------------------------------------------------------------
Net Assets, end of period (000's) $ 79
Ratio of Expenses to Average Net Assets 2.57%
Ratio of Net Investment Loss to Average Net Assets (2.50)%
Portfolio Turnover Rate 369%
Average Commission Rate Paid(3) $0.0602
- ----------------------------------------------------------------------------------------------------
</TABLE>
(1) Class C shares were first issued on July 11, 1997.
(2) Amounts shown may not correspond to amounts shown on the Statement of
Operations due to the timing of realized and unrealized gain/(loss).
(3) A fund is required to disclose its average commission rate per share for
security trades on which a commission is charged. This amount may vary
from fund to fund and period to period depending on the mix of trades
executed in various markets where trading practices and commission rate
structures may differ. This rate generally does not reflect markups,
markdowns or spreads on shares traded on a principal basis, if any.
Ratios, except for total return and portfolio turnover rate, have been
annualized. Total returns do not include the 1% contingent deferred sales
charge.
Per-share data with respect to Class C shares has been determined by using
the average number of Class C shares outstanding throughout the period.
Distributions reflect actual per-share amounts distributed for the period.
The accompanying notes are an integral part of these financial statements.
15
<PAGE>
NOTES TO FINANCIAL STATEMENTS
The Information Age Fund-TM- (the "Fund") is a series of the Robertson Stephens
Investment Trust (the "Trust"), a Massachusetts business trust organized on
May 11, 1987. The Fund is registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as a diversified, open-end management
investment company. The Fund became effective to offer shares to the public
on November 15, 1995. The Trust offers twelve series of shares -- The
Robertson Stephens Emerging Growth Fund, The Robertson Stephens Value +
Growth Fund, The Contrarian Fund-TM-, The Robertson Stephens Developing
Countries Fund, The Robertson Stephens Growth & Income Fund, The Robertson
Stephens Partners Fund, The Information Age Fund-TM-, The Robertson Stephens
Global Natural Resources Fund, The Robertson Stephens Global Low-Priced Stock
Fund, The Robertson Stephens Diversified Growth Fund, The Robertson Stephens
MicroCap Fund and The Robertson Stephens Global Value Fund. The assets for
each series are segregated and accounted for separately.
The Trustees have authorized the issuance of two classes of shares of
beneficial interest of the Fund, designated as Class A and C, respectively.
The shares of each class represent an interest in the same portfolio of
investments of the Fund. Expenses of the Fund are borne pro-rata by the
holders of each class of shares, except that each class may bear expenses
unique to that class (including, but not limited to, distribution expenses
applicable to such class). Shares of each class would receive their pro-rata
share of the net assets of the Fund, if the Fund was liquidated. In
addition, the Board of trustees declares separate distributions on each class
of shares. Each class votes as a class only with respect to its own
distribution plan or other matters for which a class vote is required by law
or determined by the Board of Trustees. Class C shares were first issued by
the fund on July 11, 1997. Class C shares are subject to a 1% contingent
deferred sales charge if those shares are redeemed within one year of
purchase.
NOTE 1 SIGNIFICANT ACCOUNTING POLICIES:
The following policies are in conformity with generally accepted accounting
principles. The preparation of financial statements in accordance with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts and disclosures in
the financial statements. Actual results could differ from those estimates.
a. INVESTMENT VALUATIONS:
Marketable securities are valued at the last sale price on the principal
exchange or market on which they are traded; or, if there were no sales that
day, at the mean between the closing bid and asked prices. Short-term
investments that will mature in 60 days or less are stated at amortized cost,
which approximates market value. At December 31, 1997, 100% of the Fund's
portfolio was valued in this manner.
Securities for which market quotations are not readily available are valued
at their fair value as determined in accordance with the guidelines and
procedures adopted by the Fund's Board of Trustees. The guidelines and
procedures use fundamental valuation methods which include, but are not
limited to, the analysis of: the effect of any restrictions on the sale of
the security, product development and trends of the security's issuer,
changes in the industry and other competing companies, significant changes in
the issuer's financial position, and any other event which could have a
significant impact on the value of the security. At December 31, 1997, no
security of the Fund was valued using these guidelines and procedures.
As its normal course of business, the Fund has invested a significant portion
of its assets in companies within a number of industries in the technology
sector. Accordingly, the performance of the Fund may be subject to a greater
risk of market fluctuation than that of a fund invested in a wider spectrum
of market or industrial sectors.
b. REPURCHASE AGREEMENTS:
Repurchase agreements are fully collateralized by U.S. government securities.
All collateral is held by the Fund's custodian and is monitored daily to
ensure that the collateral's market value equals at least 100% of the
repurchase price under the agreement. However, in the event of default or
bankruptcy, realization and/or retention of the collateral may be subject to
legal proceedings. The Fund's policy is to limit repurchase agreement
transactions to those parties deemed by the Fund's Investment Adviser to have
satisfactory creditworthiness.
16
<PAGE>
c. FEDERAL INCOME TAXES:
The Fund intends to comply with requirements of the Internal Revenue Code,
qualifying as a regulated investment company. Therefore, the Fund does not
expect to be subject to income tax, and no provision for such tax will be
made.
d. SECURITIES TRANSACTIONS:
Securities transactions are accounted for on the date securities are
purchased or sold (trade date). Realized gains or losses on securities
transactions are determined on the basis of specific identification.
e. INVESTMENT INCOME:
Dividend income is recorded on the ex-dividend date, except certain cash
dividends from foreign securities which are recorded as soon as the Fund is
informed of the ex-dividend date. Interest income, which includes accretion
of original issue discount, is accrued and recorded daily.
f. EXPENSES:
Most expenses of the Trust can be directly attributed to a specific fund.
Expenses which cannot de directly attributed to a specific fund are
apportioned between the funds in the Trust.
g. DISTRIBUTIONS TO SHAREHOLDERS:
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital.
Undistributed net investment income and accumulated undistributed net
realized gain/(loss) on investments and foreign currency transactions may
include temporary book and tax differences which will reverse in a subsequent
period. During any particular year net realized gains from investment
transactions, in excess of available capital loss carryforwards, would be
taxable to the Fund if not distributed and, therefore, will be distributed to
shareholders annually. Any taxable income or gain remaining at fiscal year
end is distributed in the following year.
h. CLASS ALLOCATIONS:
Income, common expenses, and realized and unrealized gains/(losses) are
determined at the Fund level and allocated daily to each class of shares
based on the appropriate net assets of the respective classes. Transfer agent
expenses, distribution/shareholder service fees, and any other class specific
expenses, if any, are calculated daily at the class level based on the
appropriate daily net assets of each class and the specific expense rate
applicable to each class.
i. CAPITAL ACCOUNTS:
Due to the timing of dividend distributions and the differences in accounting
for income and realized gains/(losses) for financial statement and federal
income tax purposes, the fiscal year in which amounts are distributed may
differ from the year in which the income and realized gains/(losses) were
recorded by the Fund.
j. TEMPORARY BORROWINGS:
The Fund and several affiliated funds share in a $15 million, uncommitted
revolving credit and/or overdraft protection facility from the Fund's
custodian bank for temporary borrowing purposes, including the meeting of
redemption requests that otherwise might require the untimely disposition of
securities. Interest is calculated based on the market rates at the time of
borrowing. The Fund may borrow up to a maximum of 33 percent of its total
assets under the agreement.
NOTE 2 CAPITAL SHARES:
a. TRANSACTIONS:
The Fund has authorized an unlimited number of shares of beneficial interest
with no par value divided into two classes designated Class A and Class C.
Transactions in capital shares for Class A for the year ended December 31,
1997, and for the year ended December 31, 1996, and for Class C
17
<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
for the period from July 11, 1997 (Commencement Operations) to December 31,
1997, were as follows:
<TABLE>
<CAPTION>
CLASS A
1/1/97 - 12/31/97 SHARES AMOUNT
- ---------------------------------------------------------------------------
<S> <C> <C>
Shares sold 25,505,081 $ 335,203,643
Shares reinvested 343,648 4,278,380
- ---------------------------------------------------------------------------
25,848,729 339,482,023
- ---------------------------------------------------------------------------
Shares redeemed (25,009,938) (322,525,340)
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Net increase 838,791 $ 16,956,683
- ---------------------------------------------------------------------------
1/1/96 - 12/31/96 SHARES AMOUNT
- ---------------------------------------------------------------------------
Shares sold 19,929,762 $ 218,745,343
Shares reinvested 211,321 2,430,192
- ---------------------------------------------------------------------------
20,141,083 221,175,535
- ---------------------------------------------------------------------------
Shares redeemed (14,441,218) (156,975,089)
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Net increase 5,699,865 $ 64,200,446
- ---------------------------------------------------------------------------
</TABLE>
CLASS C
<TABLE>
<CAPTION>
7/11/97* - 12/31/97 SHARES AMOUNT
- ---------------------------------------------------------------------------
<S> <C> <C>
Shares sold 7,784 $ 116,388
Shares reinvested 221 2,730
- ---------------------------------------------------------------------------
8,005 119,118
- ---------------------------------------------------------------------------
Shares redeemed (1,205) (17,855)
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Net increase 6,800 $ 101,263
- ---------------------------------------------------------------------------
</TABLE>
* Class C shares were first issued on July 11, 1997.
NOTE 3 TRANSACTIONS WITH AFFILIATES:
a. ADVISORY FEES AND EXPENSE LIMITATION:
Under the terms of an advisory agreement, which is reviewed and approved
annually (beginning in 2000) by the Board of Trustees, the Fund pays
Robertson, Stephens & Company Investment Management, L.P. ("RSIM, L.P.") an
investment advisory fee and an administrative services fee calculated at an
annual rate of 1.00% and 0.25%, respectively, of the average daily net assets
of the Fund. For the year ended December 31, 1997, the Fund incurred
investment advisory fees and administrative fees of $1,234,823 and $308,706,
respectively. For the year ended December 31, 1997, there was no expected
reimbursement of advisory fees and other expenses.
RSIM, L.P. may recoup waived or reimbursed operating expenses over the
succeeding two years, subject to expense limitations then applicable to the
Fund. No previous expense waivers or reimbursements of operating expenses were
recouped by RSIM, L.P. from the Fund during the year ended December 31, 1997.
b. COMPENSATION OF TRUSTEES AND OFFICERS:
Trustees and officers of the Trust who are interested persons of the Trust
receive no compensation from the Trust. Trustees of the Trust who are not
interested persons of the Trust, as defined in the 1940 Act, collectively
received compensation and reimbursement of expenses of $22,265 for the year
ended December 31, 1997.
c. DISTRIBUTION FEES:
For the period from January 1, 1997, through September 30, 1997, the Fund
entered into agreements with Robertson, Stephens & Company LLC ("RS&Co.") for
distribution services with respect to its Class A and Class C shares and
adopted Plans of Distribution pursuant to Rule 12b-1 under the 1940 Act,
where continuance is reviewed annually by the Fund's Board of Trustees.
Under these Plans, RS&Co. was compensated for services in such capacity
including its expenses in connection with the promotion and distribution of
the Fund's Class A and Class C shares. The distribution fees for Class A and
Class C shares are calculated at an annual rate of 0.25% and 0.75%,
respectively, based on the average daily net assets attributed to each class
of shares, although the Class C Plan contemplates payments at a rate of up to
1% of the Fund's average net assets attributable to Class C
18
<PAGE>
shares. For the period from January 1, 1997, through September 30, 1997, for
Class A, and for the period from July 11, 1997 (Commencement of Operations)
through September 30, 1997, for Class C, the Fund paid distribution fees of
$211,611 and $25, respectively, to RS&Co. On October 1, 1997, BankAmerica
Corporation ("BAC") became the owner of the entire beneficial interest in
RSIM, L.P. (See note 5.a. in Notes to the Financial Statements). As part of
that acquisition, BAC also became the owner of the entire beneficial interest
in RSIM's affiliate, BancAmerica Robertson Stephens (formerly Robertson
Stephens & Company LLC). Pursuant to certain laws and regulations that apply
to bank holding companies and their affiliates, a bank holding
company-affiliated broker-dealer may not serve as the distributor or
principal underwriter of mutual funds. Commencing October 1, 1997, Edgewood
Services, Inc., a non-affiliate, has been designated the Fund's new
distributor.
d. SHAREHOLDER SERVICING FEE:
The Trust has adopted a Shareholder Servicing Plan for the Class C shares of
each fund. Under the Plan, each fund pays fees to BancAmerica Robertson
Stephens ("BARS") at an annual rate of up to 0.25% of the fund's average
daily net assets of the Class C shares. The plan contemplates that financial
institutions will enter into shareholder service agreements with BARS to
provide administrative support services to their customers who are fund
shareholders. In return for providing these support services, a financial
institution may receive payments from BARS at a rate not exceeding 0.25% of
the average daily net assets of the Class C shares of each fund for which the
financial institution is the financial institution of record. For the period
from July 11, 1997 (Commencement of Operations), through December 31, 1997,
for Class C shares, the Fund incurred shareholder servicing fees of $55.
e. BROKERAGE COMMISSIONS:
RSIM, L.P. may direct orders for investment transactions to BARS as
broker-dealer, subject to Fund policies as stated in the prospectus,
regulatory constraints, and the ability of BARS to provide competitive prices
and commission rates. All investment transactions in which BARS acts as a
broker may only be executed on an agency basis. Subject to certain
constraints, the Fund may make purchases of securities from offerings or
underwritings in which BARS has been retained by the issuer. For the year
ended December 31, 1997, the Fund paid brokerage commissions of $19,850 to
BARS, which represented 5.9% of total commissions paid during this period.
NOTE 4 INVESTMENTS:
a. TAX BASIS OF INVESTMENTS:
At December 31, 1997, the cost of investments for federal income tax purposes
was $106,288,137. Accumulated net unrealized appreciation on investments was
$11,325,857, consisting of gross unrealized appreciation and depreciation of
$18,664,004 and $7,338,147, respectively.
b. INVESTMENT PURCHASES AND SALES:
For the year ended December 31, 1997, the cost of investments purchased and
the proceeds from investments sold (excluding short-term investments) were
$429,202,195 and $418,290,042, respectively.
NOTE 5 ACQUISITION:
On October 1, 1997 BankAmerica Corporation completed its acquisition of
Robertson, Stephens & Company Group, L.L.C. and Robertson, Stephens &
Company, Inc. Pursuant to that acquisition, BankAmerica Corporation became
the owner of the entire beneficial interest in RSIM, L.P.
19
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Trustees and Shareholders of The Information Age Fund-TM-
In our opinion, the accompanying statement of assets and liabilities,
including the schedule of investments, and the related statements of
operations and of changes in net assets and the financial highlights present
fairly, in all material respects, the financial position of The Information
Age Fund-TM- (the "Fund") at December 31, 1997, and the results of its
operations and the changes in its net assets and the financial highlights for
each of the periods presented, in conformity with generally accepted
accounting principles. These financial statements and financial highlights
(hereafter referred to as "financial statements") are the responsibility of
the Fund's management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of these
financial statements in accordance with generally accepted auditing
standards, which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. We believe that
our audits, which included confirmation of securities at December 31, 1997,
by correspondence with the custodian and brokers, and the application of
alternative auditing procedures where confirmations from brokers were not
received, provide a reasonable basis for the opinion expressed above.
/s/ Price Waterhouse LLP
Price Waterhouse LLP
San Francisco, California
February 7, 1998
ADMINISTRATION
OFFICERS AND TRUSTEES
Andrew P. Pilara, Jr., Trustee
President
Leonard B. Auerbach, Trustee
President and Chairman of Auerbach Associates, Inc.
John W. Glynn, Jr., Trustee
Principal and Chairman of Glynn Capital Management
James K. Peterson, Trustee
Former Director of the IBM Retirement Funds
Terry R. Otton
Chief Financial Officer
Dana K. Welch
Secretary
INVESTMENT ADVISER
Robertson, Stephens & Company
Investment Management, L.P.
555 California Street, Suite 2600
San Francisco, CA 94104
DISTRIBUTOR
Edgewood Services, Inc.
Clearing Operations
P.O. Box 897
Pittsburgh, PA 15230-0897
TRANSFER AGENT AND DISBURSING AGENT
State Street Bank & Trust Company
c/o National Financial Data Services
Kansas City, MO
1-800-272-6944
CUSTODIAN
State Street Bank & Trust Company
Boston, MA
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
San Francisco, CA
LEGAL COUNSEL
Ropes & Gray
Boston, MA
This report is submitted for the information of shareholders of The
Information Age Fund-TM-. It is not authorized for distribution to
prospective investors unless preceded or accompanied by an effective
prospectus.
Published February 13, 1998
20
<PAGE>
Design: Broom & Broom, Inc., San Francisco
Photography: Jerry Orabona, Bill Zemanek
THE ROBERTSON STEPHENS MUTUAL FUNDS
VALUE
THE PARTNERS FUND
A SMALL-CAP FUND USING A
CASH FLOW VALUE METHODOLOGY
Managed by Andrew Pilara.
GROWTH & INCOME
THE GROWTH & INCOME FUND
SEEKING GROWTH WHILE
ATTEMPTING TO MODERATE RISK
Managed by John Wallace.
GROWTH
THE DIVERSIFIED GROWTH FUND
FOCUSING ON SMALL- AND
MID-CAP COMPANIES
Managed by John Wallace
and John Seabern.
THE EMERGING GROWTH FUND
SEEKING TO INVEST IN AMERICA'S
MOST DYNAMIC, GROWTH-
ORIENTED COMPANIES
Managed by Jim Callinan.
THE INFORMATION AGE FUND-TM-
TARGETING INVESTMENTS IN THE
INFORMATION TECHNOLOGY SECTOR
Managed by Ron Elijah
and Rod Berry.
THE MICROCAP GROWTH FUND
FOCUSING ON COMPANIES WITH MARKET
CAPS OF LESS THAN $250 MILLION
Managed by Dave Evans
and Rainerio Reyes.
THE VALUE + GROWTH FUND
A GROWTH FUND FOR THE
LONG-TERM INVESTOR
Managed by Ron Elijah.
GLOBAL
THE CONTRARIAN FUND-TM-
A GLOBAL HEDGE FUND
Managed by Paul Stephens.
THE GLOBAL LOW-PRICED STOCK FUND
SEEKING OVERLOOKED AND UNDERVALUED
COMPANIES
Managed by Hannah Sullivan.
THE GLOBAL NATURAL RESOURCES FUND
PRIMARILY FOCUSING ON HARD
ASSET COMPANIES
Managed by Andrew Pilara.
THE GLOBAL VALUE FUND
SEEKING UNDERVALUED
INVESTMENTS WORLDWIDE
Managed by Andrew Pilara.
INTERNATIONAL
THE DEVELOPING COUNTRIES FUND
LOOKING FOR GROWING COMPANIES
IN EMERGING MARKETS
Managed by Michael Hoffman.
Please read the prospectus to learn about the Funds' objectives, investment
policies, and the special risks associated with The Robertson Stephens Mutual
Funds, including international investing, investing in smaller companies,
investing in a more limited number of issuers and sectors or a particular
sector, short selling, using options and futures, and investing in
high-yielding, lower-quality debt securities.
MUTUAL FUND SHARES ARE NOT INSURED BY THE FDIC OR ANY OTHER GOVERNMENTAL
ENTITY; ARE NOT DEPOSITS OR OTHER OBLIGATIONS OF, OR GUARANTEED BY BANK OF
AMERICA OR ANY OF ITS AFFILIATES; AND ARE SUBJECT TO INVESTMENT RISKS,
INCLUDING POSSIBLE LOSS OF THE PRINCIPAL AMOUNT INVESTED.
<PAGE>
ROBERTSON STEPHENS FUNDS
BRINGING THE FUND MANAGER TO YOU
555 California Street, Suite 2600
San Francisco, California 94104
FUND NEWS & INFORMATION
ROBERTSON STEPHENS INVESTOR SERVICES
- - Knowledgeable mutual fund representatives.
- - Automated access to daily net asset values.
- - Portfolio Manager Hotline, 24 hours a day.
l-800-766-3863
ROBERTSON STEPHENS
MUTUAL FUND E-MAIL
[email protected]
ROBERTSON STEPHENS
ON THE WEB
http://www.rsim.com
ROBERTSON STEPHENS
ACCOUNTLINK
- - Automated account information, 24 hours a day.
l-800-624-8025
FUND LISTINGS
The Fund is listed in THE WALL STREET JOURNAL, USA TODAY, INVESTOR'S BUSINESS
DAILY, and most local newspapers as InfoAge under the heading Robertson
Stephens. Its computer quotation symbol is RSIFX.
The views expressed in this report were those of the Fund's portfolio manager
as of the date specified, and may not reflect the views of the portfolio
manager on the date they are first published or at any other time thereafter.
RSIM and its affiliates may buy or sell investments at any time for the Fund,
their other clients or for their own accounts, and may not necessarily do so
in a manner consistent with the views expressed in this report. The prices at
which they buy or sell investments may be affected favorably by the contents
of this report or the timing of its publication. THE VIEWS EXPRESSED IN THIS
REPORT ARE INTENDED TO ASSIST SHAREHOLDERS OF THE FUND IN UNDERSTANDING THEIR
INVESTMENT IN THE FUND AND DO NOT CONSTITUTE INVESTMENT ADVICE; INVESTORS
SHOULD CONSULT THEIR OWN INVESTMENT PROFESSIONALS AS TO THEIR INDIVIDUAL
INVESTMENT PROGRAMS.
