[LOGO] FIRST AMERICAN FUNDS(R)
THE POWER OF DISCIPLINED INVESTING(R)
EQUITY
FUNDS
ANNUAL REPORT
2000
FIRST AMERICAN
INVESTMENT FUNDS, INC.
<PAGE>
FIRST AMERICAN
FAMILY OF FUNDS
INVESTMENTS FOR EVERY GOAL
FIRST AMERICAN FUNDS OFFER A FULL RANGE OF INVESTMENT STRATEGIES TO HELP YOU
CREATE A PERSONALIZED, DIVERSIFIED PORTFOLIO. WITH OUR DISCIPLINED FOCUS ON
CONSISTENT, COMPETITIVE PERFORMANCE AND HIGHLY DEVELOPED TEAM APPROACH TO
INVESTMENT DECISION MAKING, FIRST AMERICAN FUNDS CAN HELP BUILD A WINNING
STRATEGY FOR ANY INVESTOR.
HIGHER RISK (o)
AND RETURN POTENTIAL |
|
(*) EQUITY FUNDS
|
| LARGE CAP FUNDS
| Balanced
| Equity Income
| Equity Index
| Large Cap Growth
| Large Cap Value
|
| MID CAP FUNDS
| Mid Cap Growth
| Mid Cap Value
|
| SMALL CAP FUNDS
| Small Cap Growth
| Small Cap Value
|
| INTERNATIONAL FUNDS
| Emerging Markets
| International
| International Index
|
| SECTOR FUNDS
| Health Sciences
| Real Estate Securities
| Technology
|
(*) FUNDS OF FUNDS
|
|
(*) BOND FUNDS
|
|
(*) TAX FREE BOND FUNDS
|
|
(*) MONEY MARKET FUNDS
|
|
LOWER RISK (o)
AND RETURN POTENTIAL
Mutual fund investing involves risk; principal loss is possible.
TABLE OF CONTENTS
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Message to Shareholders 1
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Report of Independent Auditors 35
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LARGE CAP FUNDS
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Statements of Net Assets 36
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Statements of Operations 50
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Statements of Changes in Net Assets 52
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Financial Highlights 54
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MID CAP FUNDS
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Statements of Net Assets 58
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Statements of Operations 62
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Statements of Changes in Net Assets 63
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Financial Highlights 64
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SMALL CAP FUNDS
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Statements of Net Assets 66
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Statements of Operations 70
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Statements of Changes in Net Assets 71
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Financial Highlights 72
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INTERNATIONAL FUNDS
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Statements of Net Assets 74
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Statement of Assets and Liabilities 85
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Statements of Operations 86
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Statements of Changes in Net Assets 87
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Financial Highlights 88
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SECTOR FUNDS
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Statements of Net Assets 90
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Statements of Operations 96
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Statements of Changes in Net Assets 97
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Financial Highlights 98
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Notes to Financial Statements 102
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Notice to Shareholders 116
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NOT FDIC INSURED NO BANK GUARANTEE MAY LOSE VALUE
<PAGE>
MESSAGE TO SHAREHOLDERS NOVEMBER 15, 2000
DEAR SHAREHOLDERS:
On behalf of the entire board of directors and the staff of First American
Asset Management, thank you for the ongoing opportunity you have given us
to manage your investments. As always, we strive to provide you, our fund
shareholders, consistent and competitive investment performance over time.
At times during the past year technology stocks, healthcare stocks,
municipal bonds, and long Treasury bonds have been market leaders. Small-
and mid-cap stocks outperformed large-cap stocks, and in general, market
volatility was the norm. Guessing which sector of the equity market or
which asset class will be the next market leader can be a risky way to
invest. We believe that a well-diversified portfolio of equity and bond
funds is the best way to invest over the long term. Your investment
professional can help you design and implement a portfolio that is right
for you.
The accompanying discussion of investment results, financial statements,
and notes detail the results of fund operations for the fiscal year and
fund holdings as of September 30, 2000. We urge you to review the
discussion of investment results and financial statements at your
convenience.
Again, thank you for investing in the First American family of funds. We
look forward to serving your investment needs next year and beyond.
Sincerely,
/s/ Virginia L. Stringer /s/ Paul A. Dow
VIRGINIA L. STRINGER PAUL A. DOW
Chairperson of the Board Chief Investment Officer and President
First American Investment Funds, First American Asset Management
Inc.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 1)
<PAGE>
A DRAMATIC YEAR FOR THE MARKETS
Last September, financial markets were on the threshold of a meteoric rally that
would lift the Dow Jones Industrial Average (Dow) and the technology-laden
Nasdaq Composite Index (Nasdaq) to record highs. At the close of 1999, investors
celebrated the fifth consecutive year of double-digit returns fueled by
unprecedented productivity gains--which boosted corporate earnings while helping
to contain inflation--and the lowest unemployment rate in three decades. For a
while, all seemed well with the nation's "Goldilocks" economy (not too hot, not
too cold).
Yet in a comment that would dictate the performance of stocks and bonds over the
ensuing months, Alan Greenspan, Chairman of the Federal Reserve Board, vowed to
continue raising interest rates until the economy cooled. The rate increases
were intended to engineer a soft landing by encouraging consumers and companies
to stop spending so much to purchase new homes, capital equipment, and the like.
STOCKS BOW TO BONDS
The prospect of additional rate hikes and their impact on corporate profits sent
the stock market into a freefall, with the Nasdaq declining 25% during April's
second week. The Dow soon followed suit. The stock market bubble had burst, with
risk returning to the marketplace. The months following April also were subject
to significant levels of market fluctuations. Although the long-term outlook for
equities remains promising, investors can expect to experience more volatility
as the economy continues to slow.
If any clear trends have emerged in the equity market, it's that small-cap
stocks have outperformed large-cap stocks, and value has outperformed growth.
Both are a reversal from the previous two years' trend of a market where
large-cap growth stocks dominated.
(2 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
A DRAMATIC YEAR FOR THE MARKETS
BONDS GAIN MOMENTUM
An unusual event shaped bond markets during the fiscal year. For the first time
in a decade, the yield on 30-year Treasury bonds dipped below the yield on
two-year Treasury notes, creating an inverted yield curve. This event was
triggered by the Treasury Department's decision to use part of the budget
surplus to retire debt by issuing fewer bonds and repurchasing 30-year Treasury
bonds. The scarcity of Treasury bonds sent prices up and yields down. Along the
way, the 10-year Treasury note replaced the 30-year bond as the U.S. bond
market's benchmark.
In all, U.S. government and municipal securities outperformed stocks to post
their strongest results in years. Indeed, with the exception of high-yield
"junk" bonds, most bonds, including mortgage-backed securities and
investment-grade corporate bonds, performed well during the fiscal year.
In closing, an important message to remember amid today's volatile and
fast-paced markets: Diversification among stocks, bonds, and cash can help you
earn more balanced returns over time and give you peace of mind in changing
markets. To help you achieve your long-term goals, First American Funds offers a
spectrum of mutual funds designed to meet any investor's needs and risk
tolerance.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 3)
<PAGE>
BALANCED
INVESTMENT OBJECTIVE: TO MAXIMIZE TOTAL RETURN (CAPITAL APPRECIATION PLUS
INCOME)
The First American Balanced Fund returned 4.67% (Class A shares returned 4.50%
on net asset value) for the fiscal year ended September 30, 2000. This compares
to a return of 13.28% for the fund's broad-based equity benchmark, the Standard
& Poor's 500 Composite Index. The Lehman U.S. Aggregate Bond Index, which is the
fund's current broad-based bond index, returned 6.99% while its previous
broad-based bond index, the Lehman U.S. Government/Credit Bond Index, returned
6.72%. Additionally, the fund's peer group represented by the Lipper Balanced
Funds Average, returned 11.31%.
The fund maintained a 55% equity and a 45% bond position throughout the fiscal
year. The main reason for the fund's underperformance was its lack of exposure
to growth stocks during the quarter ended December 31, 1999, that saw large-cap
growth stocks rise disproportionately to large-cap value stocks. The fund's
equity exposure was limited only to value stocks during this time frame. In
February, the investment strategy of the fund was modified to allow growth
stocks into the equity portion of the portfolio. In an effort to avoid missing
the potential upside in value stocks, the management team decided to
opportunistically buy growth stocks over the course of an 18-month period until
the fund's equity position reached a 50/50 mix. At the end of the fiscal year,
the fund's equity position was approximately one third growth and two thirds
value.
The fund's 45% bond position performed well overall and helped mute the
volatility of the equity position while providing income. Duration was extended
during the first half of the fiscal year, and reduced to neutral to slightly
long in the second half. Good security selection also contributed to the bond
portion's performance.
A solid fixed-income position, coupled with a balanced growth/value equity
position, should help curb volatility even further going forward. The decision
to implement growth stocks into the portfolio has paid off as the management
team has been able to exploit the market's volatility by buying growth stocks
with solid fundamentals as the market drops. The fund is well positioned to
weather the potential volatility of the coming fiscal year.
<TABLE>
<CAPTION>
ANNUALIZED PERFORMANCE(1)
-----------------------------------------------------------------------------------------------------
AS OF SEPTEMBER 30, 2000 SINCE INCEPTION(7)
------------------------------------------------
1 YEAR 5 YEARS 12/14/1992 2/4/1994 8/15/1994 2/1/1999
-----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A NAV 4.50% 11.14% 11.42% -- -- --
-----------------------------------------------------------------------------------------------------
Class A POP -1.01% 9.95% 10.66% -- -- --
-----------------------------------------------------------------------------------------------------
Class B NAV 3.59% 10.30% -- -- 11.43% --
-----------------------------------------------------------------------------------------------------
Class B POP -1.03% 10.03% -- -- 11.43% --
-----------------------------------------------------------------------------------------------------
Class C NAV 3.65% -- -- -- -- 2.05%
-----------------------------------------------------------------------------------------------------
Class C POP 1.66% -- -- -- -- 1.43%
-----------------------------------------------------------------------------------------------------
Class Y 4.67% 11.42% -- 11.49% -- --
-----------------------------------------------------------------------------------------------------
S&P 500 Composite Index(3) 13.28% 21.68% 19.03% 20.89% 22.14% 11.16%
-----------------------------------------------------------------------------------------------------
Lehman U.S. Aggregate Bond
Index(4) 6.99% 6.47% 6.73% 6.52% 7.33% 4.59%
-----------------------------------------------------------------------------------------------------
Lehman U.S. Government/Credit
Index(5) 6.72% 6.29% 6.73% 6.38% 7.22% 4.15%
-----------------------------------------------------------------------------------------------------
60% S&P 500/40%
Lehman Aggregate 10.76% 15.60% 14.18% 15.19% 16.27% 8.76%
-----------------------------------------------------------------------------------------------------
Lipper Balanced Funds Average(6) 11.31% 12.73% 11.86% 12.35% 13.37% 8.51%
--------------------------------------------------------------------------------------------------
</TABLE>
(4 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
BALANCED
VALUE OF A $10,000 INVESTMENT(1),(2) AS OF SEPTEMBER 30, 2000
[PLOT POINTS CHART]
<TABLE>
<CAPTION>
FIRST AMERICAN FIRST AMERICAN FIRST AMERICAN LEHMAN U.S. 60% S&P LEHMAN U.S. LIPPER
BALANCED BALANCED BALANCED S&P 500 AGGREGATE 500/40% GOVERNMENT/ BALANCED
FUND, FUND, FUND, COMPOSITE BOND LEHMAN CREDIT FUNDS
CLASS A NAV CLASS A POP CLASS Y INDEX(3) INDEX(4) AGGREGATE INDEX(5) AVERAGE(6)
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
12/1992 10,000 9,475 10,000 10,000 10,000 10,000 10,000
9/1993 10,978 10,402 10,755 10,969 10,843 11,138 10,938
9/1994 11,311 10,717 11,152 10,616 10,943 10,677 10,931
9/1995 13,637 12,921 14,464 12,110 13,491 12,209 13,070
9/1996 15,766 14,938 17,403 12,701 15,380 12,760 14,713
9/1997 19,834 18,792 24,439 13,938 19,614 13,983 18,331
9/1998 19,977 18,928 26,653 15,540 21,697 15,779 18,964
9/1999 22,124 20,963 34,062 15,483 25,166 15,523 21,372
9/2000 23,120 21,906 38,586 16,565 27,947 16,566 23,789
CLASS Y
2/1994 10,000 10,000 10,000 10,000 10,000 10,000
9/1994 9,935 10,074 9,713 9,932 9,683 9,802
9/1995 12,010 13,066 11,079 12,245 11,072 11,720
9/1996 13,919 15,721 11,620 13,959 11,571 13,193
9/1997 17,561 22,077 12,752 17,802 12,681 16,437
9/1998 17,742 24,077 14,218 19,693 14,309 17,004
9/1999 19,706 30,770 14,166 22,842 14,078 19,164
9/2000 20,626 34,857 15,156 25,366 15,024 21,331
</TABLE>
(1) Past performance does not guarantee future results. The principal value of
an investment and investment return will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original cost.
Performance reflects voluntary fee waivers in effect. In the absence of such
fee waivers, total returns would be reduced. Indexes are for illustrative
purposes only and are not available for investment.
Total returns at net asset value ("NAV") reflect performance over the time
period indicated without including the fund's maximum sales charge and
assumes reinvestment of all distributions at net asset value.
Total returns at public offering price ("POP") reflect performance over the
time period indicated including maximum sales charges of 5.25% for Class A,
1% for Class C and the maximum CDSC for Class B and Class C shares for the
relevant period. Total returns assume reinvestment of all distributions at
net asset value.
(2) Performance for Class B and Class C shares is not presented. Performance for
these classes is lower due to higher expenses.
(3) An unmanaged index of large capitalization stocks.
(4) An unmanaged index composed of the Lehman Government/Credit Bond Index, the
Lehman Mortgage Backed Securities Index and the Lehman Asset Backed
Securities Index. The Lehman Government/Credit Bond Index is comprised of
Treasury securities, other securities issued or guaranteed by the U.S.
government or its agencies or instrumentalities, including U.S. agency
mortgage securities and investment grade corporate debt securities. The
Lehman Mortgage Backed Securities Index is comprised of the mortgage-backed
pass-through securities of Ginnie Mae, Fannie Mae and Freddie Mac. The
Lehman Asset Backed Securities Index is composed of debt securities backed
by credit card, auto and home equity loans that are rated investment grade
or higher. The fund previously used the Lehman U.S. Gov't/Credit Index as
its broad-based index. Going forward, the fund will use the Lehman U.S.
Aggregate Bond Index as its broad-based index, because it is better suited
to the fund's strategy.
(5) An unmanaged index comprised of Treasury securities, other securities issued
or guaranteed by the U.S. government or its agencies or instrumentalities,
including U.S. agency mortgage securities and investment grade corporate
debt securities.
(6) Similar funds as categorized by Lipper, Inc.
(7) The since inception performance of the index for each class is calculated
from the month-end following the inception of the class.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 5)
<PAGE>
EQUITY INCOME
INVESTMENT OBJECTIVE: LONG-TERM GROWTH OF CAPITAL AND INCOME
The Equity Income Fund returned 11.46% (Class A shares returned 11.11% on net
asset value) for the fiscal year ended September 30, 2000, surpassing its peer
group represented by the Lipper Equity Income Funds Average, which returned
8.17% during the same period. Elevated by the booming technology sector during
the fourth quarter of 1999 and the early part of 2000, the Standard & Poor's 500
Composite Index, the fund's broad-based benchmark, returned 13.28% during this
period.
Because the fund emphasizes stocks with above average dividends, it was not able
to join in the tech rally that occurred during the fourth quarter of 1999. These
stocks typically do not pay meaningful dividends. This was, however, a boon for
the fund during the tumultuous months of March, April, and May 2000, as the
technology-heavy Nasdaq took investors on a spiraling ride downward.
The fund's overweight in the more defensive sectors of energy, financials, and
REITs paid off during the second and third quarter of calendar year 2000 as
investors sought a safe-haven away from the increasingly volatile technology
sector. The fund also benefited from a full weighting in the health care sector
with standout performance from several large pharmaceutical companies including
Johnson & Johnson, American Home Products, and Pfizer. The fund also benefited
from investing in convertible preferred securities such as biotech company
Protein Designs. Due partially to the Federal Reserve's rate tightening policy,
economically sensitive value stocks, such as Honeywell and DuPont, detracted
from performance.
The outlook for dividend paying stocks over the next fiscal year looks favorable
to the team as expectation of continued volatility in the more aggressive
sectors of technology and communication services continue to chase investors
into more stable blue-chip stocks. The team will look opportunistically within
these two volatile sectors for high dividend paying "broken" convertibles.
Overall, a stable interest-rate environment, a moderating economy, and a return
to a more rational investment environment paints a compelling backdrop for stock
picking.
<TABLE>
<CAPTION>
ANNUALIZED PERFORMANCE(1)
--------------------------------------------------------------------------------------------------
AS OF SEPTEMBER 30, 2000 SINCE INCEPTION(6)
-------------------------------------------------
1 YEAR 5 YEARS 12/18/1992 8/2/1994 8/15/1994 2/1/1999
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A NAV 11.11% 15.07% 13.01% -- -- --
--------------------------------------------------------------------------------------------------
Class A POP 5.29% 13.84% 12.24% -- -- --
--------------------------------------------------------------------------------------------------
Class B NAV 10.35% 14.31% -- -- 14.54% --
--------------------------------------------------------------------------------------------------
Class B POP 5.35% 14.08% -- -- 14.54% --
--------------------------------------------------------------------------------------------------
Class C NAV 10.41% -- -- -- -- 4.20%
--------------------------------------------------------------------------------------------------
Class C POP 8.31% -- -- -- -- 3.56%
--------------------------------------------------------------------------------------------------
Class Y 11.46% 15.45% -- 15.53% -- --
--------------------------------------------------------------------------------------------------
S&P 500 Composite Index(3) 13.28% 21.68% 19.03% 22.14% 22.14% 11.16%
--------------------------------------------------------------------------------------------------
Lehman U.S. Gov't/Credit Bond
Index(4) 6.72% 6.29% 6.73% 7.22% 7.22% 4.15%
--------------------------------------------------------------------------------------------------
70% S&P 500/30%
Lehman Gov't/Credit 11.31% 17.06% 15.41% 17.71% 17.71% 9.25%
--------------------------------------------------------------------------------------------------
Lipper Equity Income
Funds Average(5) 8.17% 13.56% 13.38% 14.08% 14.08% 6.41%
--------------------------------------------------------------------------------------------------
</TABLE>
(6 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
EQUITY INCOME
VALUE OF A $10,000 INVESTMENT(1),(2) AS OF SEPTEMBER 30, 2000
[PLOT POINTS CHART]
<TABLE>
<CAPTION>
FIRST AMERICAN FIRST AMERICAN FIRST AMERICAN LEHMAN U.S. 70% S&P 500/ LIPPER
EQUITY EQUITY EQUITY S&P 500 GOVERNMENT/ 30% LEHMAN EQUITY
INCOME FUND, INCOME FUND, INCOME FUND, COMPOSITE CREDIT BOND GOVERNMENT/ INCOME FUNDS
CLASS A NAV CLASS A POP CLASS Y INDEX(3) INDEX(4) CREDIT AVERAGE(5)
-----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
CLASS A
12/1992 10,000 9,475 10,000 10,000 10,000 10,000
9/1993 10,335 9,792 10,755 11,138 10,872 11,240
9/1994 10,841 10,272 11,152 10,677 11,016 11,565
9/1995 12,799 12,127 14,464 12,209 13,765 13,959
9/1996 14,900 14,118 17,403 12,760 15,890 16,335
9/1997 19,543 18,517 24,439 13,983 20,756 21,863
9/1998 21,180 20,068 26,653 15,779 22,979 21,965
9/1999 23,243 22,023 34,062 15,523 27,214 24,702
9/2000 25,825 24,470 38,586 16,566 30,360 26,720
CLASS Y
8/1994 10,000 10,000 10,000 10,000 10,000
9/1994 9,886 9,756 9,849 9,784 9,810
9/1995 11,689 12,654 11,262 12,226 11,841
9/1996 13,652 15,225 11,770 14,114 13,856
9/1997 17,945 21,380 12,899 18,435 18,545
9/1998 19,534 23,317 14,555 20,410 18,632
9/1999 21,506 29,799 14,320 24,171 20,954
9/2000 23,971 33,757 15,282 26,966 22,665
</TABLE>
(1) Past performance does not guarantee future results. The principal value of
an investment and investment return will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original cost.
Performance reflects voluntary fee waivers in effect. In the absence of such
fee waivers, total returns would be reduced. Indexes are for illustrative
purposes only and are not available for investment.
Total returns at net asset value ("NAV") reflect performance over the time
period indicated without including the fund's maximum sales charge and
assumes reinvestment of all distributions at net asset value.
Total returns at public offering price ("POP") reflect performance over the
time period indicated including maximum sales charges of 5.25% for Class A,
1% for Class C and the maximum CDSC for Class B and Class C shares for the
relevant period. Total returns assume reinvestment of all distributions at
net asset value.
On May 18, 1994, the Equity Income Fund became the successor by merger to
the Boulevard Strategic Balance Fund. Prior to the merger, the First
American fund had no assets or liabilities. Performance prior to May 18,
1994, is that of the Boulevard Strategic Balance Fund.
(2) Performance for Class B and Class C shares is not presented. Performance for
these classes is lower due to higher expenses.
(3) An unmanaged index of large capitalization stocks.
(4) An unmanaged index comprised of Treasury securities, other securities issued
or guaranteed by the U.S. government or its agencies or instrumentalities,
including U.S. agency mortgage securities and investment grade corporate
debt securities.
(5) Similar funds as categorized by Lipper, Inc.
(6) The since inception performance of the index for each class is calculated
from the month-end following the inception of the class.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 7)
<PAGE>
EQUITY INDEX
INVESTMENT OBJECTIVE: TO PROVIDE INVESTMENT RESULTS THAT CORRESPOND TO THE
PERFORMANCE OF THE STANDARD & POOR'S 500 COMPOSITE INDEX (S&P 500)
A tale of two economies describes the 12.38% (Class A shares returned 12.11% on
net asset value) return the First American Equity Index Fund posted for the
fiscal year ended September 30, 2000. The fund underperformed its broad-based
benchmark, the Standard & Poor's 500 Composite Index, which returned 13.28%
(index funds will generally underperform their broad-based indices because,
unlike mutual funds, indices do not have to account for expenses, transaction
costs, or cash flow effects in their performance figures). Additionally, the
fund's peer group represented by the Lipper S&P 500 Funds Average returned
12.65%.
The quarter ended December 31, 1999, saw the technology sector of the S&P 500
lead the Equity Index Fund to a 14.54% (Class A shares 14.46%) return. This
quarter proved to be the largest contributor to overall performance for the
fiscal year. During this period, the new economy (a phrase generally used to
describe technology and technology related sectors) dramatically outpaced old
economy stocks (a phrase generally used to describe the industrial, consumer,
basic materials, financial, and energy related sectors).
The technology sector has been a continuing factor in the performance of the S&P
500 index. Further, Standard & Poor's has added several new, large technology
firms to the index during recent quarters. As a result of these actions, the
technology sector's weighting as a percent of the S&P 500 Index rose from 17% in
1998 to 34% in 2000.
An important part of this increase in the value of technology stocks was the
substantial price appreciation of individual stocks within the sector. During
the final three quarters of the fiscal year, investors questioned the valuations
that many of these stocks had achieved. In the ensuing revaluations of
investors' expectations and outlooks for the technology sector, technology and
"new economy" stocks in general declined. With this sector making up such a
large share of the index, the fund declined -1.88% (Class A shares declined
-2.06% on net asset value) during the last three quarters, as leadership and
investor sentiment swayed back and forth between new economy and old economy
stocks.
The management team believes the year ahead may bring continued volatility as
investors decide what part of the economy will assume leadership. Because the
Equity Index Fund invests in all 500 stocks of the S&P 500 Index, which covers a
broad representation of all sectors in the economy, you will participate in old
as well as new economy stocks without having to decide what facet of the economy
will be the next month's winner.
<TABLE>
<CAPTION>
ANNUALIZED PERFORMANCE(1)
----------------------------------------------------------------------------------------------------
AS OF SEPTEMBER 30, 2000 SINCE INCEPTION(5)
------------------------------------------------
1 YEAR 5 YEARS 12/14/1992 2/4/1994 8/15/1994 2/1/1999
----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A NAV 12.11% 20.93% 18.34% -- -- --
----------------------------------------------------------------------------------------------------
Class A POP 6.24% 19.63% 17.53% -- -- --
----------------------------------------------------------------------------------------------------
Class B NAV 11.25% 20.04% -- -- 20.91% --
----------------------------------------------------------------------------------------------------
Class B POP 6.25% 19.85% -- -- 20.91% --
----------------------------------------------------------------------------------------------------
Class C NAV 11.32% -- -- -- -- 7.15%
----------------------------------------------------------------------------------------------------
Class C POP 9.19% -- -- -- -- 6.49%
----------------------------------------------------------------------------------------------------
Class Y 12.38% 21.23% -- 20.12% -- --
----------------------------------------------------------------------------------------------------
S&P 500 Composite Index(3) 13.28% 21.68% 19.03% 20.89% 22.14% 11.16%
----------------------------------------------------------------------------------------------------
Lipper S&P 500 Funds Average(4) 12.65% 21.15% 18.57% 20.39% 21.61% 10.51%
----------------------------------------------------------------------------------------------------
</TABLE>
(8 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
EQUITY INDEX
VALUE OF A $10,000 INVESTMENT(1),(2) AS OF SEPTEMBER 30, 2000
[PLOT POINTS CHART]
<TABLE>
<CAPTION>
FIRST AMERICAN FIRST AMERICAN FIRST AMERICAN LIPPER
EQUITY EQUITY EQUITY S&P 500 S&P 500
INDEX FUND, INDEX FUND, INDEX FUND, COMPOSITE FUNDS
CLASS A NAV CLASS A POP CLASS Y INDEX(3) AVERAGE(4)
-------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CLASS A
12/1992 10,000 9,475 10,000 10,000
9/1993 10,751 10,186 10,755 10,716
9/1994 11,100 10,517 11,152 11,061
9/1995 14,308 13,557 14,464 14,276
9/1996 17,134 16,234 17,403 17,100
9/1997 23,897 22,642 24,439 23,883
9/1998 25,928 24,567 26,653 25,916
9/1999 33,006 31,273 34,062 32,918
9/2000 37,003 35,060 38,586 37,079
CLASS Y
2/1994 10,000 10,000 10,000
9/1994 10,065 10,074 10,050
9/1995 13,001 13,066 12,972
9/1996 15,599 15,721 15,538
9/1997 21,815 22,077 21,701
9/1998 23,739 24,077 23,548
9/1999 30,293 30,770 29,911
9/2000 34,044 34,857 33,691
</TABLE>
(1) Past performance does not guarantee future results. The principal value of
an investment and investment return will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original cost.
Performance reflects voluntary fee waivers in effect. In the absence of such
fee waivers, total returns would be reduced. Indexes are for illustrative
purposes only and are not available for investment.
Total returns at net asset value ("NAV") reflect performance over the time
period indicated without including the fund's maximum sales charge and
assumes reinvestment of all distributions at net asset value.
Total returns at public offering price ("POP") reflect performance over the
time period indicated including maximum sales charges of 5.25% for Class A,
1% for Class C and the maximum CDSC for Class B and Class C shares for the
relevant period. Total returns assume reinvestment of all distributions at
net asset value.
(2) Performance for Class B and Class C shares is not presented. Performance for
these classes is lower due to higher expenses.
(3) An unmanaged index of large capitalization stocks.
(4) Similar funds as categorized by Lipper, Inc.
(5) The since inception performance of the index for each class is calculated
from the month-end following the inception of the class.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 9)
<PAGE>
LARGE CAP GROWTH
INVESTMENT OBJECTIVE: LONG-TERM GROWTH OF CAPITAL
The fiscal year ended September 30, 2000, was an excellent period for the First
American Large Cap Growth Fund, which closed the fiscal year with a 26.13%
return (Class A shares were up 25.74% on net asset value). This return surpassed
that of its broad-based benchmark, the Standard & Poor's 500 Composite Index,
which returned 13.28%, and the style-based benchmark, the S&P 500/BARRA Growth
Index, which returned 12.04%. The fund, however, underperformed its peer group,
the Lipper Large-Cap Growth Funds Average that posted a 30.33% return.
Although the fund's holdings represent all economic sectors included in the S&P
500 Index, technology stocks represent the fund's largest sector holding-and the
greatest source of the fund's gains during the fiscal year. The fourth quarter
of calendar year 1999, was a boon for technology stocks, as investor sentiment
became exuberant on prospects of increasing earnings growth rates for wireless
service providers, computer software, and computer component companies.
Companies such as EMC, Nokia, Oracle, and Cisco Systems-all key portfolio
holdings-experienced strong growth as consumer and business demand drove
earnings in these technology stocks. Internet Capital Group and Microsoft are
two fund holdings that detracted from performance during the period.
Toward the latter part of the fiscal year, defensive stocks within the
financial, healthcare, and utility sectors were favorable as investor sentiment
turned away from the increasingly volatile technology sector. Investor interest
within these three areas continued throughout the year as compelling valuations
and robust merger and acquisition activity made these sectors attractive
investment opportunities.
At the fund level, due to increasing energy demand, the team has increased its
exposure to drilling and equipment companies such as Nabors Industries,
Schlumberger, and Transocean Offshore. Long term, the fund is very positive on
the technology sector, as fundamentals remain strong. The management team's
outlook for the next fiscal year is favorable for large-company growth stocks.
Overall, a stable interest-rate environment, a moderating economy, and a return
to a more rational investment environment bodes well for this asset class.
<TABLE>
<CAPTION>
ANNUALIZED PERFORMANCE(1)
---------------------------------------------------------------------------------------------------
AS OF SEPTEMBER 30, 2000 SINCE INCEPTION(6)
-------------------------------------------------
1 YEAR 5 YEARS 12/18/1992 8/2/1994 8/15/1994 2/1/1999
---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A NAV 25.74% 21.80% 16.41% -- -- --
---------------------------------------------------------------------------------------------------
Class A POP 19.14% 20.50% 15.61% -- -- --
---------------------------------------------------------------------------------------------------
Class B NAV 24.84% 20.88% -- -- 22.41% --
---------------------------------------------------------------------------------------------------
Class B POP 19.84% 20.69% -- -- 22.41% --
---------------------------------------------------------------------------------------------------
Class C NAV 24.89% -- -- -- -- 18.40%
---------------------------------------------------------------------------------------------------
Class C POP 22.63% -- -- -- -- 17.68%
---------------------------------------------------------------------------------------------------
Class Y 26.13% 22.10% -- 23.38% -- --
---------------------------------------------------------------------------------------------------
S&P 500 Composite Index(3) 13.28% 21.68% 19.03% 22.14% 22.14% 11.16%
---------------------------------------------------------------------------------------------------
S&P 500/BARRA Growth Index(4) 12.04% 24.98% 20.28% 25.38% 25.38% 10.85%
---------------------------------------------------------------------------------------------------
Lipper Large-Cap Growth
Funds Average(5) 30.33% 23.17% 19.32% 23.45% 23.45% 22.82%
---------------------------------------------------------------------------------------------------
</TABLE>
(10 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
LARGE CAP GROWTH
VALUE OF A $10,000 INVESTMENT(1),(2) AS OF SEPTEMBER 30, 2000
[PLOT POINTS CHART]
<TABLE>
<CAPTION>
FIRST AMERICAN FIRST AMERICAN FIRST AMERICAN LIPPER
LARGE CAP LARGE CAP LARGE CAP S&P 500 S&P 500/ LARGE-CAP
GROWTH FUND, GROWTH FUND, GROWTH FUND, COMPOSITE BARRA GROWTH GROWTH FUNDS
CLASS A NAV CLASS A POP CLASS Y INDEX(3) INDEX(4) AVERAGE(5)
-----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
CLASS A
12/1992 10,000 9,475 10,000 10,000 10,000
9/1993 9,158 8,677 10,755 9,742 10,743
9/1994 9,504 9,005 11,152 10,414 10,825
9/1995 12,470 11,816 14,464 13,714 13,930
9/1996 14,638 13,869 17,403 16,739 16,210
9/1997 19,423 18,403 24,439 23,682 21,476
9/1998 19,541 18,515 26,653 27,985 22,910
9/1999 26,576 25,181 34,062 37,329 31,692
9/2000 33,417 31,662 38,586 41,824 41,288
CLASS Y
8/1994 10,000 10,000 10,000 10,000
9/1994 9,785 10,084 9,892 10,062
9/1995 12,874 13,079 13,026 12,949
9/1996 15,137 15,737 15,899 15,069
9/1997 20,095 22,099 22,494 19,963
9/1998 20,310 24,101 26,582 21,296
9/1999 27,695 30,801 35,457 29,459
9/2000 34,931 34,892 39,726 38,379
</TABLE>
(1) Past performance does not guarantee future results. The principal value of
an investment and investment return will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original cost.
Performance reflects voluntary fee waivers in effect. In the absence of such
fee waivers, total returns would be reduced. Indexes are for illustrative
purposes only and are not available for investment.
Total returns at net asset value ("NAV") reflect performance over the time
period indicated without including the fund's maximum sales charge and
assumes reinvestment of all distributions at net asset value.
Total returns at public offering price ("POP") reflect performance over the
time period indicated including maximum sales charges of 5.25% for Class A,
1% for Class C and the maximum CDSC for Class B and Class C shares for the
relevant period. Total returns assume reinvestment of all distributions at
net asset value.
On May 18, 1994, the Large Cap Growth Fund became the successor by merger to
the Boulevard Blue Chip Growth Fund. Prior to the merger, the First American
fund had no assets or liabilities. Performance prior to May 18, 1994, is
that of the Boulevard Blue Chip Growth Fund.
(2) Performance for Class B and Class C shares is not presented. Performance for
these classes is lower due to higher expenses.
(3) An unmanaged index of large capitalization stocks.
(4) An unmanaged index of companies included in the S&P 500 Composite Index with
higher price-to-book ratios.
(5) Similar funds as categorized by Lipper, Inc.
(6) The since inception performance of the index for each class is calculated
from the month-end following the inception of the class.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 11)
<PAGE>
LARGE CAP VALUE
INVESTMENT OBJECTIVE: PRIMARY-CAPITAL APPRECIATION; SECONDARY-CURRENT INCOME
Staying true to its traditional value style, the First American Large Cap Value
Fund returned 1.17% (Class A shares returned 0.92% on net asset value) for the
fiscal year ended September 30, 2000. This performance compares to a return of
13.75% for the fund's style-based benchmark, the Standard & Poor's 500/BARRA
Value Index, and a return of 13.28% for its broad-based benchmark, the Standard
& Poor's 500 Composite Index. Additionally, the fund lagged its peer group
represented by the Lipper Large Cap Value Funds Average, which posted a return
averaging 10.60%.
The fund's performance is largely attributed to its lack of participation in
semiconductor and brokerage stocks during December 1999. Valuation concerns in
regard to semiconductor names and the heightened economic sensitivity of
brokerages to inflation concerns relative to other financial stocks led the fund
to underweight these two subsectors which, unfortunately, were among the largest
contributors to the S&P 500/BARRA Value's performance for the quarter ended
December 31, 1999.
The fund outperformed the S&P 500/BARRA Value Index during the first five months
of the next two quarters. This lead slipped away in June 2000, as two of the
funds top 10 holdings, Honeywell and Electronic Data Systems Corporation, led
the fund lower as a result of disappointing earnings reports. The fund's June
2000 results coupled with the first quarter of the fiscal year, mainly December
1999, explain the majority of the fund's underperformance relative to the S&P
500/BARRA Value Index for the fiscal year.
The fourth quarter ended September 30, 2000, saw the fund outperform the Lipper
Large Cap Value Funds Average, but underperform the S&P 500/ BARRA Value Index
as an overweighting toward technology relative to the index detracted from
performance.
The management team is positive on the outlook for large-cap value. The
management team believes that the energy and financial sectors provide excellent
investment opportunities. Increasing demand bodes well for the energy sector
while the stabilization of interest rates, coupled with mergers and
acquisitions, are favorable for the financial sector. Combined, these two
sectors are responsible for approximately 40% of the fund, as well as
approximately 40% of the S&P 500/BARRA Value Index, making it vastly important
for investors to pay attention to this asset class.
<TABLE>
<CAPTION>
ANNUALIZED PERFORMANCE(1)
--------------------------------------------------------------------------------------------------
AS OF SEPTEMBER 30, 2000 SINCE INCEPTION(6)
----------------------------------
1 YEAR 5 YEARS 10 YEARS 2/4/1994 8/15/1994 2/1/1999
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A NAV 0.92% 14.06% 15.19% -- -- --
--------------------------------------------------------------------------------------------------
Class A POP -4.37% 12.84% 14.57% -- -- --
--------------------------------------------------------------------------------------------------
Class B NAV 0.17% 13.25% -- -- 14.58% --
--------------------------------------------------------------------------------------------------
Class B POP -4.27% 13.00% -- -- 14.58% --
--------------------------------------------------------------------------------------------------
Class C NAV 0.17% -- -- -- -- 1.09%
--------------------------------------------------------------------------------------------------
Class C POP -1.71% -- -- -- -- 0.48%
--------------------------------------------------------------------------------------------------
Class Y 1.17% 14.39% -- 14.75% -- --
--------------------------------------------------------------------------------------------------
S&P 500 Composite Index(3) 13.28% 21.68% 19.43% 20.89% 22.14% 11.16%
--------------------------------------------------------------------------------------------------
S&P 500/BARRA Value Index(4) 13.75% 17.90% 17.55% 17.48% 18.49% 10.94%
--------------------------------------------------------------------------------------------------
Lipper Large-Cap
Value Funds Average(5) 10.60% 16.71% 16.65% 16.44% 17.51% 8.10%
--------------------------------------------------------------------------------------------------
</TABLE>
(12 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
LARGE CAP VALUE
VALUE OF A $10,000 INVESTMENT(1),(2) AS OF SEPTEMBER 30, 2000
[PLOT POINTS CHART]
<TABLE>
<CAPTION>
FIRST AMERICAN FIRST AMERICAN FIRST AMERICAN LIPPER
LARGE CAP LARGE CAP LARGE CAP S&P 500 S&P 500/ LARGE-CAP
VALUE FUND, VALUE FUND, VALUE FUND, COMPOSITE BARRA VALUE VALUE FUNDS
CLASS A NAV CLASS A POP CLASS Y INDEX(3) INDEX(4) AVERAGE(5)
----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
CLASS A
9/1990 10,000 9,475 10,000 10,000 10,000
9/1991 12,565 11,906 13,110 12,697 13,188
9/1992 13,555 12,844 14,564 14,063 14,483
9/1993 15,700 14,876 16,449 17,229 16,813
9/1994 17,012 16,120 17,055 17,324 17,246
9/1995 21,309 20,191 22,121 22,122 21,431
9/1996 26,402 25,017 26,616 26,248 25,565
9/1997 36,652 34,729 37,377 36,540 34,822
9/1998 33,437 31,683 40,763 36,470 35,282
9/1999 40,770 38,631 52,095 44,301 42,610
9/2000 41,145 38,986 59,013 50,392 47,118
CLASS Y
2/1994 10,000 10,000 10,000 10,000
9/1994 10,097 10,074 9,926 9,952
9/1995 12,671 13,066 12,676 12,368
9/1996 15,753 15,721 15,040 14,754
9/1997 21,917 22,077 20,937 20,096
9/1998 20,061 24,077 20,897 20,361
9/1999 24,530 30,770 25,384 24,590
9/2000 24,817 34,857 28,874 27,192
</TABLE>
(1) Past performance does not guarantee future results. The principal value of
an investment and investment return will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original cost.
Performance reflects voluntary fee waivers in effect. In the absence of such
fee waivers, total returns would be reduced. Indexes are for illustrative
purposes only and are not available for investment.
Total returns at net asset value ("NAV") reflect performance over the time
period indicated without including the fund's maximum sales charge and
assumes reinvestment of all distributions at net asset value.
Total returns at public offering price ("POP") reflect performance over the
time period indicated including maximum sales charges of 5.25% for Class A,
1% for Class C and the maximum CDSC for Class B and Class C shares for the
relevant period. Total returns assume reinvestment of all distributions at
net asset value.
(2) Performance for Class B and Class C shares is not presented. Performance for
these classes is lower due to higher expenses.
(3) An unmanaged index of large capitalization stocks.
(4) An unmanaged index of companies included in the S&P 500 Composite Index with
lower price-to-book ratios.
(5) Similar funds as categorized by Lipper, Inc.
(6) The since inception performance of the index for each class is calculated
from the month-end following the inception of the class.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 13)
<PAGE>
MID CAP GROWTH
INVESTMENT OBJECTIVE: GROWTH OF CAPITAL
The First American Mid Cap Growth Fund had an excellent 12 months, closing out
the fiscal year with a 76.88% return (Class A shares were up 76.44% on net asset
value), surpassing its broad-based benchmark, the Russell Midcap Index, which
returned 31.62%, and its style-based benchmark, the Russell Midcap Growth Index,
which returned 60.37% for the same period. The fund also outpaced its peer group
represented by Lipper's Mid-Cap Growth Funds Average, which returned 63.89%.
The fund's technology exposure during the fourth quarter of 1999 drove
performance into record territory as the fund posted its best calendar quarter
return and its second best return over any three-month period, delivering an
outstanding 47.75%.
As the issues surrounding Y2K faded into memory, fiber optics, semi-conductor,
and component companies fueled the tech rally, as corporations were able to
allocate billions of dollars to build and enhance data and e-commerce
infrastructure systems. Strong consumer demand in telecommunications also helped
to drive earnings in these stocks.
Key holdings, such as JDS Uniphase, Bea Systems, and PMC Sierra, all benefited
tremendously from this rally that eventually hit the wall, and came tumbling
down, on March 3rd of this year. Several Internet holdings, including
Usinternetworking and Ask Jeeves were detractors of performance for the year.
Pharmaceuticals, financials, and utility companies attracted investment dollars
as investor sentiment turned away from the increasingly volatile technology
sector. Small- and mid-cap growth funds, with heavy technology weighting and
relatively less liquid stocks, suffered most as the unwinding continued through
May of this year. As volatility was the name of the game for much of this year's
second and third calendar quarters, the fund found some respite in its energy
and financial weightings.
At the fund level, due to increasing energy demand, the team has increased its
exposure to drilling and equipment companies. In addition, as key patents expire
for large pharmaceutical companies, the fund has begun focusing on small
pharmaceutical companies that produce generic drugs. While the management team's
short-term outlook in technology is cautious, overall, a stable interest-rate
environment, a moderating economy, and a return to a more rational investment
environment bodes well for the broader market.
<TABLE>
<CAPTION>
ANNUALIZED PERFORMANCE(1)
---------------------------------------------------------------------------------------------------
AS OF SEPTEMBER 30, 2000 SINCE INCEPTION(6)
------------------------------------
1 YEAR 5 YEARS 10 YEARS 2/18/1997 8/7/1998 2/1/1999
---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A NAV 76.44% 23.57% 24.26% -- -- --
---------------------------------------------------------------------------------------------------
Class A POP 67.18% 22.25% 23.59% -- -- --
---------------------------------------------------------------------------------------------------
Class B NAV 75.14% -- -- -- 36.25% --
---------------------------------------------------------------------------------------------------
Class B POP 70.14% -- -- -- 34.94% --
---------------------------------------------------------------------------------------------------
Class C NAV 75.10% -- -- -- -- 42.61%
---------------------------------------------------------------------------------------------------
Class C POP 72.34% -- -- -- -- 41.72%
---------------------------------------------------------------------------------------------------
Class Y 76.88% -- -- 28.58% -- --
---------------------------------------------------------------------------------------------------
Russell Midcap Index(3) 31.62% 18.29% 19.93% 18.19% 28.05% 22.30%
---------------------------------------------------------------------------------------------------
Russell Midcap Growth Index(4) 60.37% 24.63% 22.82% 28.56% 51.21% 43.72%
---------------------------------------------------------------------------------------------------
Lipper Mid-Cap
Growth Funds Average(5) 63.89% 22.49% 22.69% 29.59% 61.88% 56.95%
---------------------------------------------------------------------------------------------------
</TABLE>
(14 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
MID CAP GROWTH
VALUE OF A $10,000 INVESTMENT(1),(2) AS OF SEPTEMBER 30, 2000
[PLOT POINTS CHART]
<TABLE>
<CAPTION>
FIRST AMERICAN FIRST AMERICAN FIRST AMERICAN LIPPER
MID CAP MID CAP MID CAP RUSSELL RUSSELL MID-CAP
GROWTH FUND, GROWTH FUND, GROWTH FUND, MIDCAP MIDCAP GROWTH GROWTH FUNDS
CLASS A NAV CLASS A POP CLASS Y INDEX(3) INDEX(4) AVERAGE(5)
-----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
CLASS A
9/1990 10,000 9,475 10,000 10,000 10,000
9/1991 16,180 15,331 14,405 14,889 15,395
9/1992 16,916 16,028 16,500 16,263 16,393
9/1993 23,162 21,946 20,572 19,553 22,510
9/1994 22,610 21,423 20,911 20,029 22,515
9/1995 30,452 28,853 26,576 25,971 30,884
9/1996 35,884 34,000 30,839 30,212 36,875
9/1997 43,434 41,154 41,647 39,167 44,029
9/1998 37,766 35,783 39,144 35,493 36,628
9/1999 49,734 47,123 46,758 48,696 56,652
9/2000 87,751 83,144 61,543 78,094 92,830
CLASS Y
2/1997 10,000 10,000 10,000 10,000
9/1997 12,687 12,318 12,338 12,738
9/1998 11,065 11,578 11,181 10,597
9/1999 14,602 13,830 15,340 16,390
9/2000 25,828 18,202 24,600 26,857
</TABLE>
(1) Past performance does not guarantee future results. The principal value of
an investment and investment return will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original cost.
Performance reflects voluntary fee waivers in effect. In the absence of such
fee waivers, total returns would be reduced. Indexes are for illustrative
purposes only and are not available for investment.
Total returns at net asset value ("NAV") reflect performance over the time
period indicated without including the fund's maximum sales charge and
assumes reinvestment of all distributions at net asset value.
Total returns at public offering price ("POP") reflect performance over the
time period indicated including maximum sales charges of 5.25% for Class A,
1% for Class C and the maximum CDSC for Class B and Class C shares for the
relevant period. Total returns assume reinvestment of all distributions at
net asset value.
On August 7, 1998, the Mid Cap Growth Fund became the successor by merger to
the Piper Emerging Growth Fund, a series of Piper Funds Inc. Prior to the
merger, the First American fund had no assets or liabilities. Performance
prior to August 7, 1998, is that of the Piper Emerging Growth Fund.
Stocks of mid-capitalization companies may be slightly less volatile than
those of small-capitalization companies but still involve substantial risk
and they may be subject to more abrupt or erratic movements than large
capitalization companies. Mid Cap Growth Fund's 1999 and 2000 returns were
higher due in part to its strategy of investing in IPOs in a period
favorable for IPO investing. Of course, such favorable returns involve
accepting the risk of volatility, and there is no assurance that the fund's
future investment in IPOs will have the same effect on performance that it
did in 1999 and 2000.
(2) Performance for Class B and Class C shares is not presented. Performance for
these classes is lower due to higher expenses.
(3) An unmanaged index comprised of the 800 smallest companies in the Russell
1000 Index, which represent approximately 24% of the total market
capitalization of the investable U.S. equity market.
(4) An unmanaged index of companies included in the Russell Midcap Index with a
greater than average growth orientation, and generally higher price-to-book
and price-earnings ratios.
(5) Similar funds as categorized by Lipper, Inc.
(6) The since inception performance of the index for each class is calculated
from the month-end following the inception of the class.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 15)
<PAGE>
MID CAP VALUE
INVESTMENT OBJECTIVE: CAPITAL APPRECIATION
During the quarter ended September 30, 2000, mid-cap value stocks started making
a comeback relative to large-cap stocks. This solid quarter helped the First
American Mid Cap Value fund post a respectable return of 13.94% (Class A shares
were up 13.58% on net asset value) for the fiscal year ended September 30, 2000.
This return surpassed that of its style-based benchmark, the Russell Midcap
Value Index, which returned 13.00%. However, the fund underperformed both its
broad-based benchmark, the Russell Midcap Index (heavily influenced by
technology growth stocks), which returned 31.62% and its peer group represented
by Lipper Mid-Cap Value Funds Average, which posted a 24.24% return.
During the quarter ended December 31, 1999, the fund transitioned from a deeper
value fund (focusing on indisputably cheap stocks with distressed financial
results) to a more traditional value fund (paying more for quality companies
with stable or improving financial results). This move was made in order to help
curb volatility within the fund and has helped the fund remain more in line with
the Russell Midcap Value Index.
The fund's performance relative to the Russell Midcap Value Index for the fiscal
year came predominantly from the utilities and energy sectors. The biggest
factors evident in these two sectors was the value added by the management
team's stock selection and the anticipation that buying into these sectors early
would payoff as shortages of electricity and oil/petroleum products surfaced.
The biggest negative impact on the fund's performance came as a result of
adverse stock selection within the healthcare sector.
The management team sees the market's recent surge in mid-cap value performance
as only the beginning. The liquidity that mid-cap stocks have to offer relative
to small-cap stocks, coupled with the remaining disparity in valuations between
large- and mid-cap stocks, make this asset class one to watch for the next
fiscal year.
<TABLE>
<CAPTION>
ANNUALIZED PERFORMANCE(1)
--------------------------------------------------------------------------------------------------
AS OF SEPTEMBER 30, 2000 SINCE INCEPTION(6)
----------------------------------
1 YEAR 5 YEARS 10 YEARS 2/4/1994 8/15/1994 2/1/1999
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A NAV 13.58% 8.88% 13.28% -- -- --
--------------------------------------------------------------------------------------------------
Class A POP 7.60% 7.71% 12.67% -- -- --
--------------------------------------------------------------------------------------------------
Class B NAV 12.85% 8.11% -- -- 9.40% --
--------------------------------------------------------------------------------------------------
Class B POP 7.85% 7.87% -- -- 9.40% --
--------------------------------------------------------------------------------------------------
Class C NAV 12.81% -- -- -- -- 4.09%
--------------------------------------------------------------------------------------------------
Class C POP 10.69% -- -- -- -- 3.45%
--------------------------------------------------------------------------------------------------
Class Y 13.94% 9.21% -- 9.95% -- --
--------------------------------------------------------------------------------------------------
Russell Midcap Index(3) 31.62% 18.29% 19.93% 17.64% 18.93% 22.30%
--------------------------------------------------------------------------------------------------
Russell Midcap Value Index(4) 13.00% 14.07% 17.81% 14.32% 15.64% 8.55%
--------------------------------------------------------------------------------------------------
Lipper Mid-Cap
Value Funds Average(5) 24.24% 13.66% 14.99% 13.22% 14.16% 20.10%
--------------------------------------------------------------------------------------------------
</TABLE>
(16 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
MID CAP VALUE
VALUE OF A $10,000 INVESTMENT(1),(2) AS OF SEPTEMBER 30, 2000
[PLOT POINTS CHART]
<TABLE>
<CAPTION>
FIRST AMERICAN FIRST AMERICAN FIRST AMERICAN LIPPER
MID CAP MID CAP MID CAP RUSSELL RUSSELL MID-CAP
VALUE FUND, VALUE FUND, VALUE FUND, MIDCAP MIDCAP VALUE VALUE FUNDS
CLASS A NAV CLASS A POP CLASS Y INDEX(3) INDEX(4) AVERAGE(5)
-----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
CLASS A
9/1990 10,000 9,473 10,000 10,000 10,000
9/1991 12,417 11,763 14,405 14,078 13,661
9/1992 14,301 13,547 16,500 16,630 15,033
9/1993 17,005 16,109 20,572 21,159 18,867
9/1994 20,190 19,127 20,911 21,375 19,781
9/1995 22,740 21,542 26,576 26,665 23,879
9/1996 28,477 26,977 30,839 30,862 27,645
9/1997 39,848 37,749 41,647 43,284 38,191
9/1998 28,360 26,866 39,144 41,678 33,104
9/1999 30,637 29,024 46,758 45,562 39,331
9/2000 34,798 32,965 61,543 51,485 48,865
CLASS Y
2/1994 10,000 10,000 10,000 10,000
9/1994 10,752 9,901 10,017 9,953
9/1995 12,132 12,583 12,496 12,016
9/1996 15,239 14,601 14,463 13,911
9/1997 21,373 19,719 20,285 19,218
9/1998 15,250 18,534 19,532 16,658
9/1999 16,541 22,139 21,352 19,791
9/2000 18,847 29,139 24,128 24,589
</TABLE>
(1) Past performance does not guarantee future results. The principal value of
an investment and investment return will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original cost.
Performance reflects voluntary fee waivers in effect. In the absence of such
fee waivers, total returns would be reduced. Indexes are for illustrative
purposes only and are not available for investment. Stocks of
mid-capitalization companies may be slightly less volatile than those of
small-capitalization companies but still involve substantial risk and they
may be subject to mor abrupt or erratic movements than large capitalization
companies.
Total returns at net asset value ("NAV") reflect performance over the time
period indicated without including the fund's maximum sales charge and
assumes reinvestment of all distributions at net asset value.
Total returns at public offering price ("POP") reflect performance over the
time period indicated including maximum sales charges of 5.25% for Class A,
1% for Class C and the maximum CDSC for Class B and Class C shares for the
relevant period. Total returns assume reinvestment of all distributions at
net asset value.
(2) Performance for Class B and Class C shares is not presented. Performance for
these classes is lower due to higher expenses.
(3) An unmanaged index comprised of the 800 smallest companies in the Russell
1000 Index, which represent approximately 24% of the total market
capitalization of the investable U.S. equity market.
(4) An unmanaged index of companies included in the Russell Midcap Index with
generally lower price-to-book and price-earnings ratios, higher dividend
yields, and lower forecasted growth values.
(5) Similar funds as categorized by Lipper, Inc.
(6) The since inception performance of the index for each class is calculated
from the month-end following the inception of the class.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 17)
<PAGE>
SMALL CAP GROWTH
INVESTMENT OBJECTIVE: GROWTH OF CAPITAL
As is typical with small-cap growth stocks in general, the First American Small
Cap Growth Fund took its shareholders on a wild ride over the past 12 months.
During the quarter ended December 31, 1999, the fund turned in its best calendar
quarter return only to give much of it back during the March-May technology
swoon. Ultimately, the fund had an excellent 12 months, closing out the fiscal
year with a 62.58% return (Class A shares were up 62.07% on net asset value),
surpassing its broad-based benchmark, the Russell 2000 Index, which returned
23.39%, and its style-based benchmark, the Russell 2000 Growth Index, which
returned 29.66%. The fund also outpaced its peer group, represented by Lipper's
Small-Cap Growth Funds Average, which posted a return of 56.56% for the same
period.
The fund's exposure to technology during the fourth quarter of 1999, and the
early part of 2000, accounted for a sizable portion of the fund's return as
strong fundamentals and increasing demand for fiber optics, component parts, and
the irrational exuberance of dot.com companies fueled spectacular growth in the
sector.
Running parallel to the technology sector were the booming genomics and
biotechnology industries. The prospect of new drugs being developed as a result
of the successful mapping of the human genome, and the required technology to
make it all happen, propelled health sciences as investor money flooded into the
sector.
The fund successfully capitalized on these aggressive growth sectors with
investments in key fund holdings such as biopharmaceutical companies Medarex and
Protein Design Labs, as well as component manufacturers Power-One and Applied
Micro Circuits. Several Internet holdings, including Persistence Software and
Concur Technologies, were detractors from performance as this area unwound
fastest during the market pullback occurring in March 2000.
As the markets fell dramatically during the early part of March, larger,
defensive stocks attracted investment dollars as investor sentiment turned
quickly away from the increasingly volatile technology and biotech sectors.
Small-cap growth funds, with heavy technology weighting and relatively less
liquid stocks, suffered most as the unwinding continued through May of this
year. The fund's investment in smaller energy and financial companies provided
some cushion to the blow that was delivered to more narrowly diversified funds.
Due to increasing energy demand, the team has increased its exposure to drilling
and equipment companies. In addition, as key patents expire for large
pharmaceutical companies, the fund has begun focusing on small pharmaceutical
companies that produce generic drugs. While the management team's short-term
outlook in technology is cautious, overall, a stable interest-rate environment,
a moderating economy, and a return to a more rational investment environment
bodes well for the broader market.
<TABLE>
<CAPTION>
ANNUALIZED PERFORMANCE(1)
--------------------------------------------------------------------------------------
AS OF SEPTEMBER 30, 2000 SINCE INCEPTION(6)
------------------------
1 YEAR 5 YEARS 10 YEARS 7/31/1998 2/1/1999
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Class A NAV 62.07% 23.35% 19.96% -- --
--------------------------------------------------------------------------------------
Class A POP 53.56% 22.03% 19.32% -- --
--------------------------------------------------------------------------------------
Class B NAV 60.95% -- -- 33.93% --
--------------------------------------------------------------------------------------
Class B POP 55.95% -- -- 32.61% --
--------------------------------------------------------------------------------------
Class C NAV 61.06% -- -- -- 39.31%
--------------------------------------------------------------------------------------
Class C POP 58.44% -- -- -- 38.45%
--------------------------------------------------------------------------------------
Class Y 62.58% -- -- 35.31% --
--------------------------------------------------------------------------------------
Russell 2000 Index(3) 23.39% 12.39% 16.93% 11.93% 21.24%
--------------------------------------------------------------------------------------
Russell 2000 Growth Index(4) 29.66% 12.42% 16.26% 18.97% 27.28%
--------------------------------------------------------------------------------------
Lipper Small-Cap
Growth Funds Average(5) 56.56% 18.89% 20.98% 32.52% 48.70%
--------------------------------------------------------------------------------------
</TABLE>
(18 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
SMALL CAP GROWTH
VALUE OF A $10,000 INVESTMENT(1),(2) AS OF SEPTEMBER 30, 2000
[PLOT POINTS CHART]
<TABLE>
<CAPTION>
FIRST AMERICAN FIRST AMERICAN FIRST AMERICAN LIPPER
SMALL CAP SMALL CAP SMALL CAP RUSSELL RUSSELL SMALL-CAP
GROWTH FUND, GROWTH FUND, GROWTH FUND, 2000 2000 GROWTH GROWTH FUNDS
CLASS A NAV CLASS A POP CLASS Y INDEX(3) INDEX(4) AVERAGE(5)
-----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
CLASS A
9/1990 10,000 9,475 10,000 10,000 10,000
9/1991 14,055 13,317 14,508 15,078 15,552
9/1992 14,921 14,137 15,805 15,045 16,760
9/1993 18,581 17,605 21,046 19,435 22,519
9/1994 18,975 17,979 21,608 19,606 22,943
9/1995 21,605 20,470 26,656 25,129 30,711
9/1996 22,769 21,574 30,161 28,295 37,461
9/1997 33,168 31,427 40,171 34,905 46,478
9/1998 26,982 25,566 32,531 26,238 36,834
9/1999 38,074 36,076 38,734 34,800 52,757
9/2000 61,707 58,467 47,794 45,121 82,602
CLASS Y
7/1998 10,000 10,000 10,000 10,000
9/1998 8,384 8,689 8,472 8,449
9/1999 11,857 10,346 11,236 12,101
9/2000 19,277 12,766 14,569 18,947
</TABLE>
(1) Past performance does not guarantee future results. The principal value of
an investment and investment return will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original cost.
Performance reflects voluntary fee waivers in effect. In the absence of such
fee waivers, total returns would be reduced. Indexes are for illustrative
purposes only and are not available for investment.
Total returns at net asset value ("NAV") reflect performance over the time
period indicated without including the fund's maximum sales charge and
assumes reinvestment of all distributions at net asset value.
Total returns at public offering price ("POP") reflect performance over the
time period indicated including maximum sales charges of 5.25% for Class A,
1% for Class C and the maximum CDSC for Class B and Class C shares for the
relevant period. Total returns assume reinvestment of all distributions at
net asset value.
On July 31, 1998, the Small Cap Growth Fund became the successor by merger
to the Piper Small Company Growth Fund, a series of Piper Funds Inc.
Performance presented prior to July 31, 1998, is that of the Piper Small
Companies Growth Fund. On September 21, 1996, shareholders approved a change
in the fund's investment objective from high total investment return
consistent with prudent investment risk to long-term capital appreciation.
In connection with this change, the fund's investment policies were revised.
Stocks of small-capitalization companies involve substantial risk. These
stocks historically have experienced greater volatility than stocks of
larger companies and they may be expected to do so in the future. Small Cap
Growth Fund's 1999 and 2000 returns were higher due in part to its strategy
of investing in IPOs in a period favorable for IPO investing. Of course,
such favorable returns involve accepting the risk of volatility, and there
is no assurance that the fund's future investment in IPOs will have the same
effect on performance as it did in 1999 and 2000.
(2) Performance for Class B and Class C shares is not presented. Performance for
these classes is lower due to higher expenses.
(3) An unmanaged index comprised of the 2000 smallest companies in the Russell
3000 Index. The Russell 3000 Index is composed of 3000 large U.S. companies
representing approximately 98% of the total market capitalization of the
investable U.S. equity market.
(4) An unmanaged index of companies included in the Russell 2000 Index with a
greater than average growth orientation, and generally higher price-to-book
and price-earnings ratios.
(5) Similar funds as categorized by Lipper, Inc.
(6) The since inception performance of the index for each class is calculated
from the month-end following the inception of the class.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 19)
<PAGE>
SMALL CAP VALUE
INVESTMENT OBJECTIVE: CAPITAL APPRECIATION
The First American Small Cap Value Fund posted its best fiscal year performance
since 1997 with a 23.56% (Class A shares were up 23.19% on net asset value)
return for the fiscal year ended September 30, 2000. This return surpassed that
of its style-based benchmark, the Russell 2000 Value Index, which returned
15.36% and the fund's peer group represented by the Lipper Small-Cap Value Funds
Average which posted a return of 20.66%. Additionally, the fund performed in
line with its broad-based benchmark, the Russell 2000 Index, which returned
23.39%.
The fund's strong performance relative to the Russell 2000 Value Index was a
function of positive allocation and stock selection in certain sectors. One such
decision was an overweighting toward technology that, when coupled with good
stock selection, was responsible for approximately 10% of the fund's return.
Positive stock selection and underweightings in both the materials and
processing and the financial services sectors also had a significant positive
impact on overall performance. These positive contributions were partially
offset by underperformance in the consumer discretionary and healthcare areas.
The outlook for the next fiscal year appears favorable for small-cap value
stocks. This stems from a stable interest-rate environment, a moderating
economy, and the continued attractiveness of small-cap stock valuations relative
to large-cap stock valuations. At the fund level, the management team has
reduced its technology weighting and has been using the proceeds to add to the
financial services sector. Additionally, the fund is overweighted in the energy
sector.
<TABLE>
<CAPTION>
ANNUALIZED PERFORMANCE(1)
--------------------------------------------------------------------------------------
AS OF SEPTEMBER 30, 2000 SINCE INCEPTION(6)
-------------------------
1 YEAR 5 YEARS 10 YEARS 11/24/1997 2/1/1999
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Class A NAV 23.19% 10.89% 20.46% -- --
--------------------------------------------------------------------------------------
Class A POP 16.74% 9.70% 19.81% -- --
--------------------------------------------------------------------------------------
Class B NAV 22.31% -- -- 2.73% --
--------------------------------------------------------------------------------------
Class B POP 17.31% -- -- 1.48% --
--------------------------------------------------------------------------------------
Class C NAV 22.29% -- -- -- 14.82%
--------------------------------------------------------------------------------------
Class C POP 20.07% -- -- -- 14.11%
--------------------------------------------------------------------------------------
Class Y 23.56% 11.30% 20.72% -- --
--------------------------------------------------------------------------------------
Russell 2000 Index(3) 23.39% 12.39% 16.93% 8.27% 21.24%
--------------------------------------------------------------------------------------
Russell 2000 Value Index(4) 15.36% 11.50% 16.97% 2.84% 13.92%
--------------------------------------------------------------------------------------
Lipper Small-Cap
Value Funds Average(5) 20.66% 12.67% 15.86% 3.31% 18.34%
--------------------------------------------------------------------------------------
</TABLE>
(20 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
SMALL CAP VALUE
VALUE OF A $10,000 INVESTMENT(1),(2) AS OF SEPTEMBER 30, 2000
[PLOT POINTS CHART]
<TABLE>
<CAPTION>
FIRST AMERICAN FIRST AMERICAN FIRST AMERICAN LIPPER
SMALL CAP SMALL CAP SMALL CAP RUSSELL RUSSELL SMALL-CAP
VALUE FUND, VALUE FUND, VALUE FUND, 2000 2000 VALUE VALUE FUNDS
CLASS A NAV CLASS A POP CLASS Y INDEX(3) INDEX(4) AVERAGE(5)
-----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
CLASS A
9/1990 10,000 9,475 10,000 10,000 10,000
9/1991 15,995 15,155 14,508 13,998 13,852
9/1992 18,351 17,388 15,805 16,504 15,322
9/1993 25,027 23,713 21,046 22,541 19,564
9/1994 27,147 25,722 21,608 23,469 20,445
9/1995 38,353 36,340 26,656 27,825 24,372
9/1996 44,363 42,034 30,161 31,576 28,367
9/1997 62,903 59,600 40,171 45,043 40,510
9/1998 46,982 44,515 32,531 39,282 32,542
9/1999 52,206 49,466 38,734 41,572 36,379
9/2000 64,313 60,937 47,794 47,958 43,887
CLASS Y
9/1990 10,000 10,000 10,000 10,000
9/1991 16,016 14,508 13,998 13,852
9/1992 18,391 15,805 16,504 15,322
9/1993 25,172 21,046 22,541 19,564
9/1994 27,362 21,608 23,469 20,445
9/1995 38,479 26,656 27,825 24,372
9/1996 44,894 30,161 31,576 28,367
9/1997 63,758 40,171 45,043 40,510
9/1998 47,755 32,531 39,282 32,542
9/1999 53,180 38,734 41,572 36,379
9/2000 65,709 47,794 47,958 43,887
</TABLE>
(1) Past performance does not guarantee future results. The principal value of
an investment and investment return will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original cost.
Performance reflects voluntary fee waivers in effect. In the absence of such
fee waivers, total returns would be reduced. Indexes are for illustrative
purposes only and are not available for investment.
Total returns at net asset value ("NAV") reflect performance over the time
period indicated without including the fund's maximum sales charge and
assumes reinvestment of all distributions at net asset value.
Total returns at public offering price ("POP") reflect performance over the
time period indicated including maximum sales charges of 5.25% for Class A,
1% for Class C and the maximum CDSC for Class B and Class C shares for the
relevant period. Total returns assume reinvestment of all distributions at
net asset value.
Performance prior to August 1, 1994 is that of Small Company Value Trust
Fund, a predecessor collective trust fund. On August 1, 1994, substantially
all of the assets of Small Company Value Trust Fund were transferred into
Qualivest Small Companies Value Fund, a mutual fund registered under the
Investment Company Act of 1940. On November 21, 1997, First American Small
Cap Value Fund became the successor by merger to Qualivest Small Companies
Value Fund. The objectives, policies, and guidelines of the predecessor
funds were, in all material respects, identical to those of the Small Cap
Value Fund. Performance prior to November 21, 1997 is adjusted to reflect
Small Cap Value Fund's Class A share fee and expenses, before any fee
waivers. Small Company Value Trust Fund was not a registered under the
Investment Company Act of 1940 and therefore was not subject to certain
investment restrictions that might have adversely affected performance.
(2) Performance for Class B and Class C shares is not presented. Performance for
these classes is lower due to higher expenses.
(3) An unmanaged index comprised of the smallest 2000 companies in the Russell
3000 Index. The Russell 3000 Index is composed of 3000 large U.S. companies
representing approximately 98% of the investable U.S. equity market.
(4) An unmanaged index of companies included in the Russell 2000 Index with
generally lower price-to-book and price-earnings ratios, higher dividend
yields, and lower forecasted growth values.
(5) Similar funds as categorized by Lipper, Inc.
(6) The since inception performance of the index for each class is calculated
from the month-end following the inception of the class.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 21)
<PAGE>
EMERGING MARKETS
INVESTMENT OBJECTIVE: LONG-TERM GROWTH OF CAPITAL
The recognition that most emerging markets had recovered from the Asian crisis
of 1997-1998, along with the strong performance of technology and communication
stocks worldwide, helped lead the First American Emerging Markets Fund to its
best calendar quarter ever during the quarter ended December 31, 1999 (49.12%
Class Y shares and 49.04% Class A shares). This quarter helped propel the fund
to a 25.74% (Class A shares, 25.55% on net asset value) return for the fiscal
year ended September 30, 2000. This return handily surpassed the return of its
broad-based benchmark, the MSCI Emerging Markets Free Index, which returned
0.41%, as well as the return of its peer group represented by Lipper Emerging
Markets Funds Average, which posted a return of 8.74%.
The biggest contributors to the fund's performance were Israel, Taiwan, and
China. Israel and Taiwan benefited from the general rise in technology stocks
around the world early in this fiscal year while China benefited from a greater
reliance on free enterprise to solve its economic problems. Mexico and Brazil
were also top contributors to performance as Latin American markets started
showing strength in the second half of the fiscal year. The biggest detractors
from performance were Russia and Turkey. Emerging markets, however, were not
immune to the correction in technology and communication stocks that began in
early March and lasted into late May. As a result, during the months of March,
April, and May, the fund gave back approximately 22% of its performance gained
earlier in the fiscal year.
In general, emerging market restructuring at the corporate and government
levels, coupled with their continuing economic recovery and the stabilization of
U.S. interest rates, should provide a positive backdrop for emerging market
securities. The management team has gradually reduced the fund's weightings in
Asian markets to an underweight position while using the proceeds to build an
overweight position in Latin American markets that look particularly strong,
especially Mexico and Brazil.
<TABLE>
<CAPTION>
ANNUALIZED PERFORMANCE(1)
----------------------------------------------------------------------------------------
AS OF SEPTEMBER 30, 2000 SINCE INCEPTION(5)
--------------------------------------
1 YEAR 5 YEARS 11/9/1993 8/7/1998 2/1/2000
----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Class A NAV 25.55% 3.16% -2.28% -- --
----------------------------------------------------------------------------------------
Class A POP 18.88% 2.06% -3.04% -- --
----------------------------------------------------------------------------------------
Class B NAV 24.55% -- -- 6.77% --
----------------------------------------------------------------------------------------
Class B POP 19.55% -- -- 5.03% --
----------------------------------------------------------------------------------------
Class C NAV -- -- -- -- -15.06%(6)
----------------------------------------------------------------------------------------
Class C POP -- -- -- -- -16.75%(6)
----------------------------------------------------------------------------------------
Class Y 25.74% -- -- 7.83% --
----------------------------------------------------------------------------------------
MSCI Emerging Markets
Free Index(3) 0.41% -1.66% -0.68% 27.96% -21.46%(6)
----------------------------------------------------------------------------------------
Lipper Emerging Markets
Funds Average(4) 8.74% -0.15% -1.73% 24.55% -22.73%(6)
----------------------------------------------------------------------------------------
</TABLE>
(22 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
EMERGING MARKETS
VALUE OF A $10,000 INVESTMENT(1),(2) AS OF SEPTEMBER 30, 2000
[PLOT POINTS CHART]
<TABLE>
<CAPTION>
FIRST AMERICAN FIRST AMERICAN FIRST AMERICAN MSCI LIPPER
EMERGING EMERGING EMERGING EMERGING EMERGING
MARKETS FUND, MARKETS FUND, MARKETS FUND, MARKETS FREE MARKETS FUNDS
CLASS A NAV CLASS A POP CLASS Y INDEX(3) AVERAGE(4)
-----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CLASS A
11/1993 10,000 9,475 10,000 10,000
9/1994 11,944 11,317 12,615 11,876
9/1995 7,315 6,931 10,378 9,895
9/1996 8,867 8,402 10,920 10,712
9/1997 11,038 10,459 11,638 12,770
9/1998 5,639 5,343 6,075 6,725
9/1999 6,806 6,448 9,508 9,619
9/2000 8,544 8,096 9,547 10,459
CLASS Y
8/1998 10,000 10,000 10,000
9/1998 9,894 10,634 10,289
9/1999 11,972 16,644 14,717
9/2000 15,070 16,713 16,004
</TABLE>
(1) Past performance does not guarantee future results. The principal value of
an investment and investment return will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original cost.
Performance reflects voluntary fee waivers in effect. In the absence of such
fee waivers, total returns would be reduced. Indexes are for illustrative
purposes only and are not available for investment. International investing
involves risks not typically associated with domestic investing, including
risk of adverse currency fluctuations, potential political and economic
instability, different accounting standards, foreign government regulations,
currency exchange rates, limited liquidity and volatile prices. The risks of
international investing are particularly significant in emerging markets.
Total returns at net asset value ("NAV") reflect performance over the time
period indicated without including the fund's maximum sales charge and
assumes reinvestment of all distributions at net asset value.
Total returns at public offering price ("POP") reflect performance over the
time period indicated including maximum sales charges of 5.25% for Class A,
1% for Class C and the maximum CDSC for Class B and Class C shares for the
relevant period. Total returns assume reinvestment of all distributions at
net asset value.
On August 7, 1998, the Emerging Markets Fund became the successor by merger
to the Piper Emerging Markets Growth Fund, a series of Piper Global Funds
Inc. Prior to the merger, the First American fund had no assets or
liabilities. Performance presented from June 21, 1996 to August 7, 1998, is
that of Piper Emerging Markets Growth Fund for which Edinburgh Fund Managers
acted as sub-advisor. Performance prior to June 21, 1996, is that of the
Hercules Latin American Value Fund, a series of Hercules Funds Inc. for
which Bankers Trust company acted as sub-advisor.
(2) Performance for Class B and Class C shares is not presented. Performance for
these classes is lower due to higher expenses.
(3) An unmanaged index of securities from emerging markets that are open to
foreign investors.
(4) Similar funds as categorized by Lipper, Inc.
(5) The since inception performance of the index for each class is calculated
from the month-end following the inception of the class.
(6) Cumulative total return since inception.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 23)
<PAGE>
INTERNATIONAL
INVESTMENT OBJECTIVE: LONG-TERM GROWTH OF CAPITAL
Active management certainly paid off during the fiscal year ended September 30,
2000, as the First American International Fund posted a return of 24.95% (Class
A shares were up 24.63% on net asset value). This return surpassed its
broad-based benchmark, the MSCI EAFE Index, which returned 3.18%, as well as its
peer group represented by the Lipper International Funds, which posted a return
of 10.77%.
The fund performed well during the quarter ended December 31, 1999, when led by
selected technology and telecommunications stocks in Sweden, Finland, and Japan,
it returned 61.60% (Class A shares 61.51%) the best calendar quarter return in
the fund's history. The performance of technology and related sectors
experienced a severe correction late in the second quarter of the fiscal year
that spilled into the third quarter. During this period, the fund gave back
approximately 23% of the gains it realized earlier in the fiscal year.
Throughout this period the portfolio was transitioning to a broader portfolio,
reducing its technology weighting and adding to the financial, healthcare, and
energy sectors while maintaining and adding selective technology issues.
Additionally, the fund was gradually making some changes geographically. These
changes entailed transitioning from an overweight to underweight position in
Japan and from an underweight to overweight position in continental Europe.
The last three quarters of this fiscal year have been characterized by a
struggle for leadership not only geographically, but across sectors as well. The
management team believes that the significant performance of technology stocks
in general has abated and that Japan, which was a top-performing country in
1999, has cooled. The fund is maintaining a well-diversified portfolio with
concentrations in financials and pharmaceuticals, as well as selected technology
names. Geographically, the management team remains positive on Europe.
<TABLE>
<CAPTION>
ANNUALIZED PERFORMANCE(1)
---------------------------------------------------------------------------------------------------------
AS OF SEPTEMBER 30, 2000 SINCE INCEPTION(5)
----------------------------------------------
1 YEAR 5 YEARS 4/4/1994 4/7/1994 8/15/1994 2/1/1999
---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A NAV 24.63% 17.14% -- 13.48% -- --
---------------------------------------------------------------------------------------------------------
Class A POP 18.06% 15.88% -- 12.55% -- --
---------------------------------------------------------------------------------------------------------
Class B NAV 23.71% 16.19% -- -- 12.96% --
---------------------------------------------------------------------------------------------------------
Class B POP 18.71% 15.97% -- -- 12.96% --
---------------------------------------------------------------------------------------------------------
Class C NAV 23.74% -- -- -- -- 19.53%
---------------------------------------------------------------------------------------------------------
Class C POP 21.48% -- -- -- -- 18.84%
---------------------------------------------------------------------------------------------------------
Class Y 24.95% 17.37% 13.64% -- -- --
---------------------------------------------------------------------------------------------------------
MSCI EAFE Index(3) 3.18% 8.58% 7.72% 7.72% 7.43% 9.26%
---------------------------------------------------------------------------------------------------------
Lipper International Funds Average(4) 10.77% 10.37% 8.65% 8.65% 8.53% 15.42%
---------------------------------------------------------------------------------------------------------
</TABLE>
(24 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
INTERNATIONAL
VALUE OF A $10,000 INVESTMENT(1),(2) AS OF SEPTEMBER 30, 2000
[PLOT POINTS CHART]
<TABLE>
<CAPTION>
FIRST AMERICAN FIRST AMERICAN FIRST AMERICAN LIPPER
INTERNATIONAL INTERNATIONAL INTERNATIONAL INTERNATIONAL
FUND, FUND, FUND, MSCI EAFE FUNDS
CLASS A NAV CLASS A POP CLASS Y INDEX(3) AVERAGE(4)
------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CLASS A
4/1994 10,000 9,475 10,000 10,000
9/1994 10,039 9,512 10,094 10,175
9/1995 10,108 9,578 10,679 10,559
9/1996 10,294 9,754 11,600 11,603
9/1997 13,386 12,683 13,014 13,820
9/1998 13,534 12,824 11,929 12,379
9/1999 17,887 16,948 15,621 16,118
9/2000 21,117 20,008 16,117 17,853
CLASS Y
4/1994 10,000 10,000 10,000
9/1994 10,049 10,094 10,175
9/1995 10,128 10,679 10,559
9/1996 10,341 11,600 11,603
9/1997 13,483 13,014 13,820
9/1998 13,638 11,929 12,379
9/1999 18,057 15,621 16,118
9/2000 22,562 16,117 17,853
</TABLE>
(1) Past performance does not guarantee future results. The principal value of
an investment and investment return will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original cost.
Performance reflects voluntary fee waivers in effect. In the absence of such
fee waivers, total returns would be reduced. Indexes are for illustrative
purposes only and are not available for investment. International investing
involves risks not typically associated with domestic investing, including
risk of adverse currency fluctuations, potential political and economic
instability, different accounting standards, foreign government regulations,
currency exchange rates, limited liquidity and volatile prices.
Total returns at net asset value ("NAV") reflect performance over the time
period indicated without including the fund's maximum sales charge and
assumes reinvestment of all distributions at net asset value.
Total returns at public offering price ("POP") reflect performance over the
time period indicated including maximum sales charges of 5.25% for Class A,
1% for Class C and the maximum CDSC for Class B and Class C shares for the
relevant period. Total returns assume reinvestment of all distributions at
net asset value.
(2) Performance for Class B and Class C shares is not presented. Performance for
these classes is lower due to higher expenses.
(3) An unmanaged index including approximately 1,100 companies representing
stock markets of 20 European countries, Australia, New Zealand, Japan, Hong
Kong and Singapore.
(4) Similar funds as categorized by Lipper, Inc.
(5) The since inception performance of the index for each class is calculated
from the month-end following the inception of the class.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 25)
<PAGE>
INTERNATIONAL INDEX
INVESTMENT OBJECTIVE: TO PROVIDE INVESTMENT RESULTS THAT CORRESPOND TO THE
PERFORMANCE OF THE MORGAN STANLEY CAPITAL INTERNATIONAL EUROPE, AUSTRALIA, FAR
EAST INDEX (THE "MSCI EAFE INDEX")
The First American International Index Fund returned 3.01% (Class A shares were
up 2.90% on net asset value) for the fiscal year ended September 30, 2000. This
compares to a return of 3.18% for its broad-based index the MSCI EAFE Index
(index funds will generally underperform their broad-based indices because,
unlike mutual funds, indices do not have to account for expenses, transaction
costs, or cash flow effects in their performance figures).
The fund's objective is to provide returns that correspond to those of the MSCI
EAFE Index, which tracks the performance of approximately 1,100 stocks
throughout 20 of the world's developed countries, excluding the United States.
The best-performing countries on an absolute basis were Finland and Sweden.
Finland, led by Nokia (a world leader in the production of cellular handsets),
returned 51.25%, while Sweden, led by Ericsson (another leader in cellular
handset production), returned 33.22%. Both of these countries make up only a
small part of the overall MSCI EAFE index. The biggest contributors to
performance--based on a weighted basis--were France and Germany, which returned
16.03% and 6.18%, respectively. The United Kingdom and Japan were the biggest
detractors from performance. The United Kingdom, which encompasses approximately
20% of the MSCI EAFE Index, returned -3.79% while Japan, which encompasses
approximately 25% of the MSCI EAFE Index, returned -2.02%.
The management team's outlook for international markets is mixed. The outlook
for Japan is uncertain as its economy continues to find its footing while
European markets are posting solid profits as corporate restructuring, mergers,
and changes in corporate culture continue to take place.
<TABLE>
<CAPTION>
ANNUALIZED PERFORMANCE(1)
------------------------------------------------------------------------------------------------
AS OF SEPTEMBER 30, 2000 SINCE INCEPTION(5)
-------------------------------------
1 YEAR 5 YEARS 7/3/1995 11/24/1997 2/1/2000
------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A NAV 2.90% 7.82% 7.95% -- --
------------------------------------------------------------------------------------------------
Class A POP -2.53% 6.66% 6.85% -- --
------------------------------------------------------------------------------------------------
Class B NAV 2.05% -- -- 9.88% --
------------------------------------------------------------------------------------------------
Class B POP -2.95% -- -- 8.69% --
------------------------------------------------------------------------------------------------
Class C NAV -- -- -- -- 2.29%(6)
------------------------------------------------------------------------------------------------
Class C POP -- -- -- -- 0.28%(6)
------------------------------------------------------------------------------------------------
Class Y 3.01% 8.08% 8.26% -- --
------------------------------------------------------------------------------------------------
MSCI EAFE Index(3) 3.18% 8.58% 7.88% 11.33% -0.24%(6)
------------------------------------------------------------------------------------------------
Lipper International Funds Average(4) 10.77% 10.37% 9.92% 12.51% -4.46%(6)
</TABLE>
(26 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
INTERNATIONAL INDEX
VALUE OF A $10,000 INVESTMENT(1),(2) AS OF SEPTEMBER 30, 2000
[PLOT POINTS CHART]
<TABLE>
<CAPTION>
FIRST AMERICAN FIRST AMERICAN FIRST AMERICAN LIPPER
INTERNATIONAL INTERNATIONAL INTERNATIONAL INTERNATIONAL
INDEX FUND, INDEX FUND, INDEX FUND, MSCI EAFE FUNDS
CLASS A NAV CLASS A POP CLASS Y INDEX(3) AVERAGE(4)
------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CLASS A
7/1995 10,000 9,475 10,000 10,000
9/1995 9,801 9,287 9,806 9,956
9/1996 10,516 9,964 10,651 10,941
9/1997 11,653 11,041 11,949 13,032
9/1998 10,539 9,985 10,953 11,672
9/1999 13,879 13,151 14,342 15,199
9/2000 14,282 13,532 14,798 16,834
CLASS Y
7/1995 10,000 10,000 10,000
9/1995 9,802 9,806 9,956
9/1996 10,539 10,651 10,941
9/1997 11,715 11,949 13,032
9/1998 10,632 10,953 11,672
9/1999 14,034 14,342 15,199
9/2000 14,457 14,798 16,834
</TABLE>
(1) Past performance does not guarantee future results. The principal value of
an investment and investment return will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original cost.
Performance reflects voluntary fee waivers in effect. In the absence of such
fee waivers, total returns would be reduced. Indexes are for illustrative
purposes only and are not available for investment. International investing
involves risks not typically associated with domestic investing, including
risk of adverse currency fluctuations, potential political and economic
instability, different accounting standards, foreign government regulations,
currency exchange rates, limited liquidity and volatile prices.
Total returns at net asset value ("NAV") reflect performance over the time
period indicated without including the fund's maximum sales charge and
assumes reinvestment of all distributions at net asset value.
Total returns at public offering price ("POP") reflect performance over the
time period indicated including maximum sales charges of 5.25% for Class A,
1% for Class C and the maximum CDSC for Class B and Class C shares for the
relevant period. Total returns assume reinvestment of all distributions at
net asset value.
On November 21, 1997, the International Index Fund became the successor by
merger to the Qualivest International Opportunities Fund. Performance prior
to November 21, 1997, is that of the Qualivest International Opportunities
Fund.
(2) Performance for Class B and Class C shares is not presented. Performance for
these classes is lower due to higher expenses.
(3) An unmanaged index including approximately 1,100 companies representing
stock markets of 20 European countries, Australia, New Zealand, Japan, Hong
Kong and Singapore.
(4) Similar funds as categorized by Lipper, Inc.
(5) The since inception performance of the index for each class is calculated
from the month-end following the inception of the class.
(6) Class C was closed on June 30, 2000. Cumulative total return for the period
from February 1, 2000 to June 30, 2000 is presented.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 27)
<PAGE>
HEALTH SCIENCES
INVESTMENT OBJECTIVE: LONG-TERM GROWTH OF CAPITAL
With the completion of the successful mapping of the human genome, the fiscal
year ending September 30, 2000, saw healthcare/ biotechnology funds as the best
performing category within the Lipper universe of mutual funds. Led by the
highly volatile biotechnology subsector, healthcare stocks took off in the
fourth quarter of 1999, and continued their dizzying pace skyward into March
2000, as investors saw drug development and disease prevention potential in the
cracking of the genomics code. The Lipper Health & Biotechnology Funds Average
returned 93.39% for the fiscal year ending September 30, 2000.
Returning a respectable 62.10% (Class A shares were up 61.89% on net asset
value), the First American Health Sciences Fund, a broadly diversified
healthcare fund, lost ground to more narrowly focused biotechnology funds, but
outpaced the fund's broad-based benchmark, the Standard & Poor's Health Care
Composite Index, which delivered a 25.51% return for the same period.
As biotechnology stocks began spiraling downward from their record highs in
early March of this year, the fund had begun to reduce its exposure to this
subsector and began allocating additional assets into defensive and stable large
pharmaceutical companies such as Johnson & Johnson, Pfizer, and Warner-Lambert.
This proved a boon for the fund as these stocks continued to benefit from strong
fundamentals, robust merger and acquisition activity, and changing sentiment as
investors turned away from the increasingly volatile biotechnology subsector.
The management team's outlook for the next fiscal year is cautiously optimistic
as patent expirations and less than full product pipelines chip away at earnings
growth estimates for large pharmaceutical companies. The team is more favorable
in its outlook for genomics and biotechnology stocks as this area continues to
be a hotbed of innovative activity.
ANNUALIZED PERFORMANCE(1)
----------------------------------------------------------------------
AS OF SEPTEMBER 30, 2000 SINCE INCEPTION(5)
-----------------------------------
1 YEAR 1/31/1996 2/1/2000
----------------------------------------------------------------------
Class A NAV 61.89% 10.11% --
----------------------------------------------------------------------
Class A POP 53.39% 8.82% --
----------------------------------------------------------------------
Class B NAV 60.72% 9.28% --
----------------------------------------------------------------------
Class B POP 55.72% 8.96% --
----------------------------------------------------------------------
Class C NAV -- -- 36.17%(6)
----------------------------------------------------------------------
Class C POP -- -- 33.79%(6)
----------------------------------------------------------------------
Class Y 62.10% 10.38% --
----------------------------------------------------------------------
S&P Health Care Composite Index(3) 25.51% 23.40% 28.95%(6)
----------------------------------------------------------------------
Lipper Health & Biotechnology
Funds Average(4) 93.39% 20.08% 19.23%(6)
----------------------------------------------------------------------
(28 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
HEALTH SCIENCES
VALUE OF A $10,000 INVESTMENT(1),(2) AS OF SEPTEMBER 30, 2000
[PLOT POINTS CHART]
<TABLE>
<CAPTION>
FIRST AMERICAN FIRST AMERICAN FIRST AMERICAN S&P LIPPER HEALTH &
HEALTH HEALTH HEALTH HEALTH CARE BIOTECHNOLOGY
SCIENCES FUND, SCIENCES FUND, SCIENCES FUND, COMPOSITE FUNDS
CLASS A NAV CLASS A POP CLASS Y INDEX(3) AVERAGE(4)
---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CLASS A
1/1996 10,000 9,475 10,000 10,000
9/1996 9,868 9,350 10,910 10,577
9/1997 12,197 11,556 14,937 13,295
9/1998 9,118 8,640 20,649 13,038
9/1999 9,673 9,165 21,235 15,140
9/2000 15,659 14,837 26,652 29,279
CLASS Y
1/1996 10,000 10,000 10,000
9/1996 9,879 10,910 10,577
9/1997 12,239 14,937 13,295
9/1998 9,167 20,649 13,038
9/1999 9,771 21,235 15,140
9/2000 15,839 26,652 29,279
</TABLE>
(1) Past performance does not guarantee future results. The principal value of
an investment and investment return will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original cost.
Performance reflects voluntary fee waivers in effect. In the absence of such
fee waivers, total returns would be reduced. Indexes are for illustrative
purposes only and are not available for investment. Sector funds such as the
First American Health Sciences Fund are more vulnerable to price fluctuation
as a result of events that may affect the industry on which they focus than
are funds that invest in multiple industries. Share prices of sector funds
also will fluctuate with changing market conditions, as will share prices of
other stock funds. Sector fund should not be treated as a core investment;
rather, their role is to round out the growth portion of a well diversified
investment portfolio.
Health Sciences Fund's 1999 and 2000 returns were higher due in part to its
strategy of investing in IPOs in a period favorable for IPO investing. Of
course, such favorable returns involve accepting the risk of volatility, and
there is no assurance that the fund's future investment in IPOs will have
the same effect on performance than it did in 1999 and 2000.
Total returns at net asset value ("NAV") reflect performance over the time
period indicated without including the fund's maximum sales charge and
assumes reinvestment of all distributions at net asset value.
Total returns at public offering price ("POP") reflect performance over the
time period indicated including maximum sales charges of 5.25% for Class A,
1% for Class C and the maximum CDSC for Class B and class C shares for the
relevant period. Total returns assume reinvestment of all distributions at
net asset value.
(2) Performance for Class B and Class C shares is not presented. Performance for
these classes is lower due to higher expenses.
(3) An unmanaged index comprised of health care stocks in the S&P 500 Composite
Index (an unmanaged index of large capitalization stocks).
(4) Similar funds as categorized by Lipper, Inc.
(5) The since inception performance of the index for each class is calculated
from the month-end following the inception of the class.
(6) Cumulative total return since inception.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 29)
<PAGE>
REAL ESTATE SECURITIES
INVESTMENT OBJECTIVE: ABOVE AVERAGE CURRENT INCOME AND LONG-TERM CAPITAL
APPRECIATION
The real estate market finally woke from its near two-year slumber as strong
underlying valuations in real estate investment trusts (REITs) generated
investor interest. The First American Real Estate Securities Fund closed out the
fiscal year ending September 30, 2000, with a 26.95% return (Class A shares were
up 26.68% on net asset value), outpacing the fund's peer group, the Lipper Real
Estate Funds Average, which posted a 22.01% return during the same period. The
fund also outperformed its broad-based benchmark, the Morgan Stanley REIT Index,
which returned 21.87% for the fiscal year.
As volatility in the equity markets caused investors to look elsewhere, the
overlooked real estate sector began quietly attracting attention as investors
took notice of REITs trading at a discount to net asset value (NAV). As the
Nasdaq fell dramatically in March of this year, the flight to quality
intensified-real estate being one of the beneficiaries.
Bi-coastal geographic allocations and overweighting the high-quality subsectors
of apartments, office buildings, and industrial properties helped the fund
generate compelling returns. High rental demand and tight supply due to the
technology boom drove earnings in areas such as Silicon Valley. Spieker
Properties, an office/industrial REIT, and Avalonbay and Essex Properties, two
apartment REITs, are key holdings that continue to generate attractive returns
as a result of this boom.
The team also picked up basis points by selectively underweighting the softer,
more volatile subsectors of malls, manufactured homes, and community centers.
The fund's overweight position in Urban Shopping Centers, Inc., paid off, as
this venture was one of the best-performing REITs so far this calendar year.
With dividend yields continuing to hover around 7-7.5%, strong rental structures
and a continued discount to NAVs, the management team's outlook for the next
fiscal year is very favorable. The team will continue to overweight the strong,
high-quality subsectors of apartments, offices, and industrial properties, with
emphasis on the high demand West and East coasts.
<TABLE>
<CAPTION>
ANNUALIZED PERFORMANCE(1)
----------------------------------------------------------------------------------------------
AS OF SEPTEMBER 30, 2000 SINCE INCEPTION(5)
--------------------------------------
1 YEAR 5 YEARS 6/30/1995 9/29/1995 2/1/2000
----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A NAV 26.68% 11.03% -- 11.04% --
----------------------------------------------------------------------------------------------
Class A POP 20.00% 9.85% -- 9.86% --
----------------------------------------------------------------------------------------------
Class B NAV 25.81% 10.16% -- 10.17% --
----------------------------------------------------------------------------------------------
Class B POP 20.81% 9.88% -- 9.89% --
----------------------------------------------------------------------------------------------
Class C NAV -- -- -- -- 25.56%(6)
----------------------------------------------------------------------------------------------
Class C POP -- -- -- -- 23.27%(6)
----------------------------------------------------------------------------------------------
Class Y 26.95% 11.32% 11.84% -- --
----------------------------------------------------------------------------------------------
Morgan Stanley REIT Index(3) 21.87% 10.38% 10.71% 10.38% 23.98%(6)
----------------------------------------------------------------------------------------------
Lipper Real Estate Funds Average(4) 22.01% 10.33% 10.86% 10.33% 24.68%(6)
----------------------------------------------------------------------------------------------
</TABLE>
(30 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
REAL ESTATE SECURITIES
VALUE OF A $10,000 INVESTMENT(1),(2) AS OF SEPTEMBER 30, 2000
[PLOT POINTS CHART]
<TABLE>
<CAPTION>
FIRST AMERICAN FIRST AMERICAN FIRST AMERICAN LIPPER
REAL ESTATE REAL ESTATE REAL ESTATE MORGAN REAL ESTATE
SECURITIES FUND, SECURITIES FUND, SECURITIES FUND, STANLEY FUNDS
CLASS A NAV CLASS A POP CLASS Y REIT INDEX(3) AVERAGE(4)
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CLASS A
9/1995 10,000 9,475 10,000 10,000
9/1996 11,817 11,197 11,827 11,827
9/1997 16,162 15,314 16,662 16,662
9/1998 14,155 13,412 14,281 14,281
9/1999 13,321 12,622 13,446 13,446
9/2000 16,875 15,989 16,386 16,386
CLASS Y
6/1995 10,000 10,000 10,000
9/1995 10,519 10,411 10,544
9/1996 12,469 12,313 12,438
9/1997 17,091 17,347 17,632
9/1998 15,009 14,868 14,806
9/1999 14,163 13,998 14,465
9/2000 17,979 17,060 17,650
</TABLE>
(1) Past performance does not guarantee future results. The principal value of
an investment and investment return will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original cost.
Performance reflects voluntary fee waivers in effect. In the absence of such
fee waivers, total returns would be reduced. Indexes are for illustrative
purposes only and are not available for investment. Sector funds such as the
First American Real Estate Securities Fund are more vulnerable to price
fluctuation as a result of events that may affect the industry on which they
focus than are funds that invest in multiple industries. Share prices of
sector funds also will fluctuate with changing market conditions, as will
share prices of other stock funds. Sector fund should not be treated as a
core investment; rather, their role is to round out the growth portion of a
well diversified investment portfolio.
Total returns at net asset value ("NAV") reflect performance over the time
period indicated without including the fund's maximum sales charge and
assumes reinvestment of all distributions at net asset value.
Total returns at public offering price ("POP") reflect performance over the
time period indicated including maximum sales charges of 5.25% for Class A,
1% for Class C and the maximum CDSC for Class B and Class C shares for the
relevant period. Total returns assume reinvestment of all distributions at
net asset value.
(2) Performance for Class B and Class C shares is not presented. Performance for
these classes is lower due to higher expenses.
(3) An unmanaged index of the most actively traded real estate investment
trusts.
(4) Similar funds as categorized by Lipper, Inc.
(5) The since inception performance of the index for each class is calculated
from the month-end following the inception of the class.
(6) Cumulative total return since inception.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 31)
<PAGE>
TECHNOLOGY
INVESTMENT OBJECTIVE: LONG-TERM GROWTH OF CAPITAL
Despite the volatility that rocked technology stocks during the last half of the
first calendar quarter and most of the second and third calendar quarters of
this year, the First American Technology Fund was able to generate an astounding
80.71% fiscal year return, ending September 30, 2000 (Class A shares were up
80.11% on net asset value). The fund outpaced its peer group, the Lipper Science
& Technology Funds Average, which was up 69.60% during the same 12-month period.
The fund also beat its broad-based benchmark, the S&P High Tech Composite Index,
which returned 19.59%.
Strong fundamentals, improving earnings growth prospects, and positive investor
sentiment sparked the Nasdaq Composite Index to record highs during the fourth
quarter of 1999. Especially strong were fiber optic and networking component
stocks as corporations poured billions of dollars into building and enhancing
data stream and e-commerce infrastructure systems. As the Technology Fund
focused on well-managed companies within these industries, it was ideally
positioned to participate in the fourth quarter run-up as it posted its best
calendar quarter since its inception.
As the market's exuberance came to a head on March 3rd of this year, the
Technology Fund's holdings in smaller, less-liquid names caused the fund to
unwind faster than the Nasdaq. Throughout the remainder of the first calendar
quarter and most of the second quarter, stock picking, based on price momentum,
turned a market characterized as exuberance into a market characterized as
simply irrational. Increasing volatility in the sector caused a flight to
quality with energy, financials, utilities, and large pharmaceutical companies
earning a greater portion of investors' interest and dollars.
While the management team believes that short-term volatility is inherent in the
sector, its long-term outlook in technology remains positive as companies
continue to build infrastructure and seek productivity gains through
technological advancements. Overall, a stable interest-rate environment, a
moderating economy, and a return to a more rational investment environment bodes
well for the management team's discipline of fundamental analysis and investing
in innovative companies with strong management.
<TABLE>
<CAPTION>
ANNUALIZED PERFORMANCE(1)
------------------------------------------------------------------------------------------
AS OF SEPTEMBER 30, 2000 SINCE INCEPTION(5)
----------------------------------------------------------
1 YEAR 5 YEARS 4/4/1994 8/15/1994 2/1/2000
-------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A NAV 80.11% 36.80% 40.03% -- --
-------------------------------------------------------------------------------------------
Class A POP 70.64% 35.33% 38.88% -- --
-------------------------------------------------------------------------------------------
Class B NAV 78.77% 35.83% -- 42.11% --
-------------------------------------------------------------------------------------------
Class B POP 73.77% 35.71% -- 42.11% --
-------------------------------------------------------------------------------------------
Class C NAV -- -- -- -- -5.59%(6)
-------------------------------------------------------------------------------------------
Class C POP -- -- -- -- -6.53%(6)
-------------------------------------------------------------------------------------------
Class Y 80.71% 37.19% 40.34% -- --
-------------------------------------------------------------------------------------------
S&P High Tech Composite Index(3) 19.59% 36.33% 38.23% 38.48% -13.72%(6)
-------------------------------------------------------------------------------------------
Lipper Science & Technology
Funds Average(4) 69.60% 32.34% 32.42% 34.39% -17.19%(6)
-------------------------------------------------------------------------------------------
</TABLE>
(32 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
TECHNOLOGY
VALUE OF A $10,000 INVESTMENT(1),(2) AS OF SEPTEMBER 30, 2000
[PLOT POINTS CHART]
<TABLE>
<CAPTION>
FIRST AMERICAN FIRST AMERICAN FIRST AMERICAN S&P LIPPER SCIENCE &
TECHNOLOGY TECHNOLOGY TECHNOLOGY HIGH TECH TECHNOLOGY
FUND, FUND, FUND, COMPOSITE FUNDS
CLASS A NAV CLASS A POP CLASS Y INDEX(3) AVERAGE(4)
----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CLASS A
4/1994 10,000 9,475 10,000 10,000
9/1994 11,572 10,965 10,766 10,781
9/1995 19,235 18,226 16,984 17,288
9/1996 22,813 21,616 20,862 19,164
9/1997 26,853 25,444 33,875 25,856
9/1998 22,371 21,198 38,360 24,777
9/1999 51,165 48,481 67,050 51,198
9/2000 92,154 87,319 82,887 86,831
CLASS Y
4/1994 10,000 10,000 10,000
9/1994 11,584 10,766 10,781
9/1995 19,255 16,984 17,288
9/1996 22,885 20,862 19,164
9/1997 26,993 33,875 25,856
9/1998 22,563 38,360 24,777
9/1999 51,788 67,050 51,198
9/2000 93,585 82,887 86,831
</TABLE>
(1) Past performance does not guarantee future results. The principal value of
an investment and investment return will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original cost.
Performance reflects voluntary fee waivers in effect. In the absence of such
fee waivers, total returns would be reduced. Indexes are for illustrative
purposes only and are not available for investment. Sector funds such as the
First American Technology Fund are more vulnerable to price fluctuation as a
result of events that may affect the industry on which they focus than are
funds that invest in multiple industries. Share prices of sector funds also
will fluctuate with changing market conditions, as will share prices of
other stock funds. Sector fund should not be treated as a core investment;
rather, their role is to round out the growth portion of a well diversified
investment portfolio.
Total returns at net asset value ("NAV") reflect performance over the time
period indicated without including the fund's maximum sales charge and
assumes reinvestment of all distributions at net asset value.
Total returns at public offering price ("POP") reflect performance over the
time period indicated including maximum sales charges of 5.25% for Class A,
1% for Class C and the maximum CDSC for Class B and Class C shares for the
relevant period. Total returns assume reinvestment of all distributions at
net asset value.
Technology Fund's 1999 and 2000 returns were higher due in part to its
strategy of investing in IPOs and technology-related stocks in a period
favorable for IPO investing. Of course, such favorable returns involve
accepting the risk of volatility, and there is no assurance that the fund's
future investment in IPOs and technology stocks will have the same effect on
performance as it did in 1999 and 2000. Investments in the First American
Technology Fund are more vulnerable to price fluctuation as a result of the
narrow focus of technology investing and the fact that the products of
companies in which the fund invests may be subject to rapid obsolescence.
(2) Performance for Class B and Class C shares is not presented. Performance for
these classes is lower due to higher expenses.
(3) An unmanaged index comprised of technology stocks in the S&P 500 Composite
Index (an unmanaged index of large capitalization stocks).
(4) Similar funds as categorized by Lipper, Inc.
(5) The since inception performance of the index for each class is calculated
from the month-end following the inception of the class.
(6) Cumulative total return since inception.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 33)
<PAGE>
(This page has been left blank intentionally.)
<PAGE>
REPORT OF INDEPENDENT AUDITORS SEPTEMBER 30, 2000
To the Shareholders and Board of Directors
First American Investment Funds, Inc.
We have audited the accompanying statements of net assets of the Balanced,
Equity Income, Equity Index, Large Cap Growth, Large Cap Value, Mid Cap
Growth, Mid Cap Value, Small Cap Growth, Small Cap Value, Emerging Markets,
International, International Index, Health Sciences, Real Estate Securities
and Technology Funds and the statement of assets and liabilities of the
International Fund (certain funds constituting First American Investment
Funds, Inc.) (the "Funds") as of September 30, 2000, and the related
statements of operations for the year then ended and the statements of
changes in net assets and financial highlights for each of the two years in
the period then ended. These financial statements and financial highlights
are the responsibility of the Funds' management. Our responsibility is to
express an opinion on these financial statements and financial highlights
based on our audits. The financial highlights for the periods presented
through September 30, 1998, were audited by other auditors whose reports
dated November 13, 1998, and September 12, 1997, expressed unqualified
opinions on those financial highlights.
We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements and financial highlights are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements and
financial highlights. Our procedures included confirmation of securities
owned as of September 30, 2000, by correspondence with the custodian and
brokers. As to certain securities relating to uncompleted transactions, we
performed other auditing procedures. An audit also includes assessing the
accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. We believe
that our audits provide a reasonable basis for our opinion.
In our opinion, the 2000 and 1999 financial statements and financial
highlights referred to above present fairly, in all material respects, the
financial position of each of the above listed funds of First American
Investment Funds, Inc. at September 30, 2000, and the results of their
operations for the year then ended, and the changes in their net assets and
their financial highlights for each of the two years in the period then
ended, in conformity with accounting principles generally accepted in the
United States.
/s/ Ernst & Young LLP
Minneapolis, Minnesota
November 3, 2000
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 35)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
BALANCED FUND
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
COMMON STOCKS -- 52.8%
BASIC MATERIALS -- 2.3%
Alcoa 74,000 $ 1,873
Dow Chemical 100,800 2,514
Ecolab 28,500 1,028
International Paper 57,500 1,649
Praxair 26,200 979
------------
8,043
------------
CAPITAL GOODS -- 2.8%
Caterpillar 30,100 1,016
General Electric 60,140 3,469
Honeywell International 58,300 2,077
Minnesota Mining & Manufacturing 33,900 3,089
------------
9,651
------------
COMMUNICATION SERVICES -- 2.8%
AT&T Wireless* 22,400 468
Nextel Communications, Cl A* 32,000 1,496
SBC Communications 48,144 2,407
Verizon Communications 61,800 2,993
Vodafone, ADR 14,600 540
Worldcom* 60,100 1,825
------------
9,729
------------
CONSUMER CYCLICALS -- 3.6%
Best Buy* 23,700 1,508
Federated Department Stores* 57,600 1,505
Ford Motor 40,919 1,036
General Motors 17,800 1,157
Home Depot 20,900 1,109
Kohl's* 10,100 583
Masco 59,500 1,108
Nike, Cl B 29,700 1,190
Omnicom Group 13,550 988
Wal-Mart Stores 50,320 2,422
------------
12,606
------------
CONSUMER STAPLES -- 3.8%
Albertson's 75,900 1,594
Cox Communications* 18,710 716
General Mills 50,800 1,803
Kimberly Clark 37,600 2,098
McDonald's 55,800 1,684
Procter & Gamble 20,900 1,400
Walgreen 62,700 2,379
Walt Disney 41,400 1,584
------------
13,258
------------
ENERGY -- 5.0%
Exxon Mobil 44,500 3,966
Halliburton 59,900 2,931
Nabors Industries* 16,050 841
Royal Dutch Petroleum, ADR 50,900 3,051
Schlumberger 29,600 2,436
Texaco 31,400 1,648
Transocean Sedco Forex 38,690 2,268
------------
17,141
------------
BALANCED FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
FINANCIALS -- 10.7%
Allstate 78,900 $ 2,742
American Express 58,890 3,578
American International Group 36,965 3,537
Associates First Capital 44,000 1,672
Bank of America 44,900 2,352
Bank of New York 16,810 942
Bank One 56,200 2,171
Charles Schwab 23,900 848
Chase Manhattan 55,000 2,540
Citigroup 73,032 3,948
Fannie Mae 47,600 3,403
Fleet Boston Financial 64,390 2,511
Mellon Financial 52,400 2,430
Morgan Stanley Dean Witter 21,700 1,984
Wells Fargo 50,800 2,334
------------
36,992
------------
HEALTH CARE -- 5.1%
American Home Products 22,200 1,256
Amgen* 12,500 873
Bristol-Myers Squibb 55,600 3,176
Genentech* 7,520 1,396
Guidant* 29,400 2,078
Johnson & Johnson 16,000 1,503
Medtronic 31,900 1,653
Merck 19,640 1,462
Pfizer 44,310 1,991
Pharmacia 33,544 2,019
Protein Design Laboratories* 3,150 380
------------
17,787
------------
TECHNOLOGY -- 12.8%
America Online* 24,500 1,317
Applied Materials* 7,600 451
Automatic Data Processing 13,800 923
BMC Software* 33,000 631
Broadcom, Cl A* 5,320 1,297
Broadvision* 12,300 316
Brocade Communications Systems* 6,120 1,444
Cisco Systems* 51,900 2,867
Compaq Computer 64,200 1,771
Computer Associates International 43,900 1,106
Corning 2,720 808
Dell Computer* 20,800 641
Electronic Data Systems 49,200 2,042
EMC* 29,800 2,954
PFPC 40,900 1,598
Hewlett Packard 15,400 1,494
IBM 13,900 1,564
Intel 42,400 1,762
JDS Uniphase* 10,950 1,037
Lucent Technologies 14,650 448
Microsoft* 32,200 1,942
Motorola 78,800 2,226
Nextlink Communications, Cl A* 36,080 1,270
Nokia, ADR 28,000 1,115
Nortel Networks 23,300 1,388
Oracle Systems* 35,500 2,796
The accompanying notes are an integral part of the financial statements.
(36 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
BALANCED FUND (CONTINUED)
DESCRIPTION SHARES/PAR (000) VALUE (000)
--------------------------------------------------------------------
PE Corp-PE Biosystems Group 6,390 $ 744
PMC-Sierra* 5,200 1,119
Siebel Systems* 4,140 461
Sun Microsystems* 13,900 1,623
Texas Instruments 13,480 636
VeriSign* 6,200 1,256
Veritas Software* 9,680 1,375
------------
44,422
------------
TRANSPORTATION -- 1.0%
Delta Air Lines 35,100 1,558
Southwest Airlines 44,200 1,072
United Parcel Service 13,800 778
------------
3,408
------------
UTILITIES -- 2.9%
AES* 27,200 1,863
Duke Power 23,600 2,024
Edison International 54,000 1,043
Enron 38,800 3,400
Public Service Enterprise Group 34,300 1,533
------------
9,863
------------
TOTAL COMMON STOCKS
(Cost $166,611) 182,900
------------
CORPORATE OBLIGATIONS -- 17.9%
CONSUMER GOODS -- 1.0%
Target
5.875%, 11/01/08 $ 4,000 3,615
------------
ENERGY -- 0.9%
Consolidated Natural Gas
7.250%, 10/01/04 3,000 2,996
------------
FINANCE -- 9.3%
Associates
5.800%, 04/20/04 6,000 5,790
Bank of America
7.125%, 09/15/06 5,000 4,998
Bear Stearns
7.800%, 08/15/07 4,000 4,050
Cigna
7.400%, 01/15/03 2,825 2,807
Lehman Brothers
6.900%, 03/30/01 4,050 4,055
Newcourt Credit
6.875%, 02/16/05 5,000 4,937
Wachovia
6.605%, 10/01/25 5,500 5,383
------------
32,020
------------
MANUFACTURING -- 4.6%
Boeing
7.250%, 06/15/25 5,000 4,946
Ford Motor
5.800%, 01/12/09 4,000 3,531
GMAC
6.150%, 04/05/07 5,000 4,634
PPG Industries
7.400%, 08/15/19 3,000 2,929
------------
16,040
------------
BALANCED FUND (CONTINUED)
DESCRIPTION PAR (000) VALUE (000)
--------------------------------------------------------------------
SERVICES -- 0.6%
Time Warner
8.875%, 10/01/12 $ 2,025 $ 2,205
------------
UTILITIES -- 1.5%
GTE South
6.125%, 06/15/07 5,000 4,706
MCI Communications
7.125%, 06/15/27 500 501
------------
5,207
------------
TOTAL CORPORATE OBLIGATIONS
(Cost $63,776) 62,083
------------
U.S. GOVERNMENT AGENCY MORTGAGE-BACKED
OBLIGATIONS -- 14.4%
FHLB
6.250%, 08/13/04 6,500 6,435
FHLMC
6.500%, 01/01/01 118 117
5.950%, 01/19/06 5,000 4,856
6.500%, 09/01/12 308 302
6.000%, 03/01/15 4,778 4,605
8.000%, 11/01/24 282 286
7.000%, 12/01/29 3,892 3,817
FHLMC CMO 1606-H
6.000%, 11/15/08 3,150 3,063
FNMA
6.000%, 03/01/03 145 141
5.500%, 03/01/06 4,521 4,311
7.000%, 11/01/14 2,720 2,705
7.288%, 04/01/18 (A) 207 210
6.500%, 04/01/29 5,365 5,152
7.000%, 04/01/29 1,851 1,814
6.000%, 05/01/29 4,735 4,426
FNMA CMO 1993-50
5.500%, 10/25/22 5,000 4,431
GNMA
7.500%, 09/15/27 358 359
7.000%, 04/15/29 2,664 2,623
------------
TOTAL U.S. GOVERNMENT AGENCY MORTGAGE-BACKED OBLIGATIONS
(Cost $50,109) 49,653
------------
U.S. TREASURY OBLIGATIONS -- 6.9%
U.S. Treasury Bonds
7.125%, 02/15/23 5,000 5,619
6.875%, 08/15/25 7,000 7,707
U.S. Treasury Note
6.875%, 05/15/06 4,000 4,180
U.S. Treasury Note (TIPS)
4.250%, 01/15/10 6,162 6,295
------------
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $23,754) 23,801
------------
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 37)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
BALANCED FUND (CONTINUED)
DESCRIPTION PAR (000)/SHARES VALUE (000)
--------------------------------------------------------------------
PRIVATE MORTGAGE-BACKED SECURITIES -- 2.2%
FIXED RATE -- 2.2%
CMC Securities 1993-D D2
6.400%, 07/25/23 $ 9 $ 9
General Electric Capital Mortgage 1994-17 A6
7.000%, 05/25/24 2,675 2,637
GMAC Commercial Mortgage 1997-C2 C
6.910%, 12/15/07 5,000 4,818
------------
TOTAL PRIVATE MORTGAGE-BACKED SECURITIES
(Cost $7,616) 7,464
------------
ASSET-BACKED SECURITIES -- 4.0%
AUTOS -- 1.4%
Union Acceptance 1998-B A5
6.020%, 01/09/06 5,000 4,941
------------
HOME EQUITY -- 2.6%
Asset Securitization 1996-D6 A1B
6.880%, 11/13/26 3,000 2,995
Merrill Lynch Mortgage Investors 1995-C3 A3 (A)
7.070%, 12/26/25 6,000 6,004
------------
8,999
------------
TOTAL ASSET-BACKED SECURITIES
(Cost $14,213) 13,940
------------
U.S. GOVERNMENT AGENCY BACKED OBLIGATIONS -- 0.0%
Israel Government Trust Certificate Series 1C (B)
9.250%, 11/15/01 104 106
------------
TOTAL U.S. GOVERNMENT AGENCY BACKED OBLIGATIONS
(Cost $104) 106
------------
RELATED PARTY MONEY MARKET FUND -- 4.1%
First American Prime Obligations Fund (C) 14,108,058 14,108
------------
TOTAL RELATED PARTY MONEY MARKET FUND
(Cost $14,108) 14,108
------------
TOTAL INVESTMENTS -- 102.3%
(Cost $340,291) 354,055
------------
OTHER ASSETS AND LIABILITIES, NET -- (2.3%) (D) (8,064)
------------
BALANCED FUND (CONCLUDED)
DESCRIPTION VALUE (000)
--------------------------------------------------------------------
NET ASSETS:
Portfolio Capital--Class A ($0.0001 par value--
2 billion authorized) based on 4,387,144
outstanding shares $ 50,906
Portfolio Capital-- Class B ($0.0001 par value--
2 billion authorized) based on 3,997,193
outstanding shares 57,064
Portfolio Capital--Class C ($0.0001 par value--
2 billion authorized) based on 120,616
outstanding shares 1,667
Portfolio Capital--Class Y ($0.0001 par value--
2 billion authorized) based on 19,268,068
outstanding shares 205,254
Undistributed net investment income 269
Accumulated net realized gain on investments 17,067
Net unrealized appreciation of investments 13,764
------------
NET ASSETS -- 100.0% $ 345,991
------------
Net asset value and redemption price per
share -- Class A $ 12.45
Maximum sales charge of 5.25% (E) 0.69
------------
Offering price per share -- Class A $ 13.14
------------
Net asset value and offering price per
share -- Class B (F) $ 12.37
------------
Net asset value and redemption price per
share -- Class C (G) $ 12.43
Maximum sales charge of 1.00% (H) 0.13
------------
Offering price per share -- Class C $ 12.56
------------
Net asset value, offering price, and redemption
price per share -- Class Y $ 12.48
------------
*Non-income producing security
(A) Variable Rate Security -- the rate reported on the Statement of Net Assets
is the rate in effect as of September 30, 2000.
(B) Security is guaranteed by the United States of America.
(C) This money market fund is advised by U.S. Bank National Association who also
serves as advisor for this fund. See also the notes to the financial
statements.
(D) Other assets and liabilities representing greater than five percent of total
net assets include the following (000):
Collateral received for securities loaned, at value $ 111,612
Payable upon return of securities loaned $(111,612)
(E) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 5.25%.
(F) Class B has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(G) Class C has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(H) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 1.00%.
ADR--American Depositary Receipt
Cl--Class
CMO--Collateralized Mortgage Obligation
FHLB--Federal Home Loan Bank
FHLMC--Federal Home Loan Mortgage Corporation
FNMA--Federal National Mortgage Association
GMAC--General Motors Acceptance Corporation
GNMA--Government National Mortgage Association
TIPS--Treasury Inflation Protection Security
The accompanying notes are an integral part of the financial statements.
(38 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
EQUITY INCOME FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
COMMON STOCKS -- 97.9%
BASIC MATERIALS -- 5.0%
Dow Chemical 62,400 $ 1,556
E.I. du Pont de Nemours 84,500 3,501
Ecolab 169,900 6,127
Lyondell Chemical 135,150 1,596
Weyerhaeuser 62,800 2,536
------------
15,316
------------
CAPITAL GOODS -- 6.9%
Caterpillar 42,750 1,443
Emerson Electric 60,400 4,047
General Electric 119,400 6,888
Honeywell International 34,100 1,215
Ingersoll Rand 43,600 1,477
Minnesota Mining & Manufacturing 53,000 4,830
Parker Hannifin 44,900 1,515
------------
21,415
------------
COMMUNICATION SERVICES -- 6.3%
AT&T 141,900 4,168
Sprint 77,900 2,283
Verizon Communications 203,300 9,847
Vodafone, ADR 83,400 3,086
------------
19,384
------------
CONSUMER CYCLICALS -- 3.7%
Ford Motor 127,616 3,230
Intimate Brands 297,000 5,550
Omnicom Group 35,400 2,582
Visteon 9,558 145
------------
11,507
------------
CONSUMER STAPLES -- 7.1%
Colgate-Palmolive 97,900 4,621
Kimberly Clark 96,500 5,386
PepsiCo 98,900 4,549
Sara Lee 152,200 3,092
Time Warner 56,029 4,384
------------
22,032
------------
ENERGY -- 12.2%
BP Amoco, ADR 177,496 9,407
Chevron 38,820 3,309
Exxon Mobil 158,624 14,137
Royal Dutch Petroleum, ADR 179,200 10,741
------------
37,594
------------
FINANCIALS -- 21.5%
American Express 109,000 6,622
Associates First Capital 123,608 4,697
Bank of America 75,824 3,971
Bank of New York 137,700 7,720
Citigroup 65,466 3,539
EQUITY INCOME FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
Fannie Mae 45,000 $ 3,218
Household International 71,397 4,043
J.P. Morgan 23,120 3,777
John Hancock Financial Services* 341,200 9,170
Mellon Financial 161,100 7,471
St. Paul Companies 82,610 4,074
XL Capital, Cl A 64,682 4,754
Zions Bancorp 68,600 3,508
------------
66,564
------------
HEALTH CARE -- 12.5%
American Home Products 110,900 6,273
Baxter International 63,000 5,028
Bristol-Myers Squibb 62,700 3,582
Johnson & Johnson 77,600 7,290
Merck 89,500 6,662
Pfizer 130,500 5,864
Schering Plough 85,800 3,990
------------
38,689
------------
REAL ESTATE INVESTMENT TRUSTS -- 6.8%
Archstone Community Trust 53,900 1,324
Crescent Real Estate Equities 101,700 2,269
Duke Realty Investments 195,172 4,709
Equity Office Properties Trust 48,000 1,491
Equity Residential Properties Trust 26,600 1,277
Healthcare Realty Trust 115,700 2,444
Kimco Realty 31,600 1,335
Manufactured Home Communities 122,550 3,064
Simon Property Group 137,200 3,216
------------
21,129
------------
TECHNOLOGY -- 5.1%
Automatic Data Processing 123,800 8,279
IBM 16,500 1,856
Intel 66,000 2,743
Motorola 97,200 2,746
------------
15,624
------------
TRANSPORTATION -- 1.6%
Knightsbridge Tankers Limited 176,500 3,861
United Parcel Service 16,500 930
------------
4,791
------------
UTILITIES -- 9.2%
Consolidated Edison 90,000 3,071
Enron 76,500 6,703
FPL Group 50,400 3,314
Reliant Energy 157,500 7,324
Xcel Energy 292,600 8,047
------------
28,459
------------
TOTAL COMMON STOCKS
(Cost $177,327) 302,504
------------
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 39)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
EQUITY INCOME FUND (CONTINUED)
DESCRIPTION SHARES/PAR (000) VALUE (000)
--------------------------------------------------------------------
CONVERTIBLE BONDS -- 0.9%
Tribune (PHONES)
2.000%, 05/15/29 $ 24 $ 2,820
------------
TOTAL CONVERTIBLE BONDS
(Cost $2,542) 2,820
------------
RELATED PARTY MONEY MARKET FUND -- 1.2%
First American Prime Obligations Fund (A) 3,715,588 3,716
------------
TOTAL RELATED PARTY MONEY MARKET FUND
(Cost $3,716) 3,716
------------
TOTAL INVESTMENTS -- 100.0%
(Cost $183,585) 309,040
------------
OTHER ASSETS AND LIABILITIES, NET -- 0.0% (B) (120)
------------
NET ASSETS:
Portfolio Capital--Class A ($0.0001 par value--
2 billion authorized) based on 1,264,710
outstanding shares $ 19,340
Portfolio Capital--Class B ($0.0001 par value--
2 billion authorized) based on 638,372
outstanding shares 8,775
Portfolio Capital--Class C ($0.0001 par value--
2 billion authorized) based on 154,259
outstanding shares 2,568
Portfolio Capital--Class Y ($0.0001 par value--
2 billion authorized) based on 16,823,372
outstanding shares 121,820
Undistributed net investment income 139
Accumulated net realized gain on investments 30,823
Net unrealized appreciation of investments 125,455
------------
TOTAL NET ASSETS -- 100.0% $ 308,920
------------
Net asset value and redemption price per
share -- Class A $ 16.29
Maximum sales charge of 5.25% (C) 0.90
------------
Offering price per share -- Class A $ 17.19
------------
Net asset value and offering price per
share -- Class B (D) $ 16.24
------------
Net asset value and redemption price per
share -- Class C (E) $ 16.28
Maximum sales charge of 1.00% (F) 0.16
------------
Offering price per share -- Class C $ 16.44
------------
Net asset value, offering price, and redemption
price per share -- Class Y $ 16.37
------------
EQUITY INCOME FUND (CONCLUDED)
DESCRIPTION
--------------------------------------------------------------------
* Non-income producing security
(A) This money market fund is advised by U.S. Bank National Association who also
serves as advisor for this fund. See also the notes to the financial
statements.
(B) Other assets and liabilities representing greater than five percent of total
net assets include the following (000):
Collateral received for securities loaned, at value $ 29,992
Payable upon return of securities loaned $(29,992)
(C) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 5.25%.
(D) Class B has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(E) Class C has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(F) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 1.00%.
ADR--American Depositary Receipt
Cl--Class
PHONES--Participation Hybrid Option Note Exchangeable Securities Equity Linked
Debt Security Exchangeable At Holders Option For 95% of 1 America Online
share.
The accompanying notes are an integral part of the financial statements.
(40 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
EQUITY INDEX FUND
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
COMMON STOCKS -- 98.8%
BASIC MATERIALS -- 1.8%
Air Products & Chemicals 31,800 $ 1,145
Alcan Aluminum, ADR 30,400 880
Alcoa 119,618 3,028
Allegheny Teledyne 11,538 209
Archer Daniels Midland 88,410 763
Barrick Gold 54,700 834
Bemis 7,300 235
Bethlehem Steel* 18,200 55
Boise Cascade 7,900 210
Dow Chemical 85,875 2,142
E.I. du Pont de Nemours 141,010 5,843
Eastman Chemical 9,693 358
Ecolab 18,000 649
Engelhard 17,400 283
FMC* 1,310 88
Freeport-McMoran Copper & Gold, Cl B 22,700 200
Georgia Pacific 23,700 557
Great Lakes Chemical 7,560 222
Hercules 14,700 208
Homestake Mining 36,100 187
Inco 26,600 429
International Flavors & Fragrances 14,600 266
International Paper 66,316 1,902
Louisiana Pacific 14,800 136
Mead 14,200 332
Newmont Mining 23,200 394
Nucor 11,612 350
Pactiv* 23,800 266
Phelps Dodge 8,526 356
Placer Dome Group 45,100 426
Potlatch 4,000 126
PPG Industries 23,250 923
Praxair 21,575 806
Rohm & Haas 30,168 877
Sigma Aldrich 13,059 431
Temple Inland 6,166 234
Union Carbide 18,250 689
USX-U.S. Steel Group 12,300 187
Vulcan Materials 13,686 550
W.R. Grace* 10,000 69
Westvaco 13,900 371
Weyerhaeuser 27,129 1,095
Willamette Industries 15,500 434
Worthington Industries 12,400 116
------------
29,861
------------
CAPITAL GOODS -- 8.4%
Allied Waste Industries* 26,200 241
American Power Conversion* 26,365 506
Avery Dennison 14,293 663
B.F. Goodrich 13,761 539
Ball 4,200 133
Boeing 117,476 7,401
Briggs & Stratton 1,943 73
Caterpillar 46,964 1,585
Cooper Industries 13,100 462
Crane 9,100 208
Crown Cork & Seal 17,900 191
Cummins Engine 5,376 161
Danaher 17,742 883
EQUITY INDEX FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
Deere 32,149 $ 1,069
Dover 27,105 1,272
Eaton 6,000 370
Emerson Electric 52,010 3,485
Fluor 10,500 315
General Dynamics 23,599 1,482
General Electric 1,313,177 75,754
Honeywell International 108,021 3,848
Illinois Tool Works 36,672 2,049
Ingersoll Rand 19,729 668
ITT Industries 12,200 396
Johnson Controls 8,514 453
Lockheed Martin 57,339 1,890
McDermott International 8,300 91
Millipore 5,843 283
Minnesota Mining & Manufacturing 46,152 4,206
Molex 25,751 1,402
National Service Industries 5,600 110
Navistar International* 8,551 256
Northrop 7,388 671
Owens-Illinois* 20,800 192
Paccar 8,652 321
Pall 17,200 343
Parker Hannifin 15,376 519
Pitney Bowes 35,330 1,393
Rockwell International 24,378 737
Sanmina* 19,611 1,836
Sealed Air* 10,831 490
Solectron* 79,973 3,689
Textron 14,974 691
Thermo Electron* 23,650 615
Thomas & Betts 8,000 140
Timken 8,600 118
Tyco International 222,419 11,538
United Technologies 58,533 4,053
Waste Management 85,900 1,498
------------
141,289
------------
COMMUNICATION SERVICES -- 6.3%
Alltel 39,046 2,038
AT&T 505,142 14,839
BellSouth 250,318 10,075
Centurytel 19,400 529
Global Crossing* 117,852 3,653
Nextel Communications, Cl A* 100,627 4,704
Qwest Communications* 220,751 10,610
SBC Communications 447,597 22,380
Sprint 119,223 3,495
Sprint (PCS Group)* 123,664 4,336
Verizon Communications 358,123 17,347
Worldcom* 384,337 11,674
------------
105,680
------------
CONSUMER CYCLICALS -- 6.9%
American Greetings, Cl A 8,900 156
Armstrong Holdings 5,600 67
Autozone* 19,200 436
Bed Bath & Beyond* 38,622 942
Best Buy* 26,578 1,691
Black & Decker 11,524 394
Brunswick 12,700 232
Carnival 85,424 2,104
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 41)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
EQUITY INDEX FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
Cendant* 97,900 $ 1,065
Centex 8,200 263
Circuit City Stores 27,940 643
Consolidated Stores* 15,400 208
Convergys* 20,953 815
Cooper, Tire & Rubber 10,500 106
Costco Wholesale* 59,874 2,092
Dana 22,800 490
Delphi Automotive Systems 78,300 1,184
Dillards, Cl A 14,500 154
Dollar General 45,875 768
Dow Jones 10,083 610
Dun & Bradstreet 22,300 768
Federated Department Stores* 29,100 760
Ford Motor 255,060 6,456
Gannett 33,007 1,749
Gap 115,786 2,330
General Motors 67,240 4,371
Genuine Parts 24,700 471
Goodyear Tire & Rubber 21,700 391
H & R Block 13,600 504
Harcourt General 8,127 479
Harley-Davidson 41,428 1,983
Harrah's Entertainment* 17,800 490
Hasbro 24,400 279
Hilton Hotels 51,100 591
Home Depot 305,779 16,225
Ims Health 42,700 886
Interpublic Group 38,900 1,325
J.C. Penney 36,100 426
Kaufman & Broad Home 6,600 178
Kmart* 67,500 405
Knight-Ridder 9,228 469
Kohl's* 42,049 2,426
Leggett & Platt 27,200 430
Limited 59,600 1,315
Liz Claiborne 7,336 282
Lowe's 49,355 2,215
Marriott International, Cl A 32,707 1,192
Masco 62,000 1,155
Mattel 58,300 652
May Department Stores 46,100 945
Maytag 9,856 306
McGraw-Hill 24,616 1,565
Meredith 7,100 209
New York Times, Cl A 23,700 932
Nike, Cl B 36,136 1,448
Nordstrom 18,700 291
Office Depot* 45,600 356
Omnicom Group 21,318 1,555
Pulte 6,000 198
Radioshack 23,535 1,521
Reebok International* 7,800 147
Russell 4,600 73
Sears Roebuck 47,491 1,540
Sherwin Williams 23,000 492
Snap-On Tools 8,100 191
Springs Industries, Cl A 2,500 70
Stanley Works 12,400 286
EQUITY INDEX FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
Staples* 65,100 $ 924
Target 120,986 3,100
Tiffany & Company 19,404 748
TJX 43,000 968
Toys 'R' Us* 33,300 541
Tribune 42,202 1,841
TRW 15,219 618
V.F. 16,400 405
Visteon 21,652 327
Wal-Mart Stores 588,716 28,332
Whirlpool 7,954 309
Young & Rubicam 9,689 480
------------
116,341
------------
CONSUMER STAPLES -- 10.2%
Adolph Coors, Cl B 4,227 267
Alberto-Culver, Cl B 7,700 222
Albertson's 58,036 1,219
Anheuser Busch 112,386 4,755
Avon Products 32,396 1,324
Bestfoods 35,183 2,560
Brown Forman, Cl B 6,684 366
Campbell Soup 59,100 1,529
Cardinal Health 35,118 3,097
Clear Channel Communications* 77,151 4,359
Clorox 32,183 1,273
Coca-Cola 327,125 18,033
Coca-Cola Enterprises 59,000 940
Colgate-Palmolive 76,081 3,591
Comcast, Cl A* 123,777 5,067
ConAgra 72,228 1,449
CVS 52,684 2,440
Darden Restaurants 17,800 370
Deluxe 10,200 207
Fort James 28,734 878
Fortune Brands 22,800 604
General Mills 40,771 1,447
Gillette 143,952 4,445
H.J. Heinz 48,032 1,780
Hershey Foods 18,492 1,001
Kellogg 56,200 1,359
Kimberly Clark 68,888 3,845
Kroger* 115,700 2,610
Longs Drug Stores 5,500 105
McDonald's 185,025 5,585
McKesson HBOC 39,100 1,195
Nabisco Group Holdings 45,200 1,288
Newell Rubbermaid 38,326 874
PepsiCo 196,230 9,027
Philip Morris 307,381 9,049
Procter & Gamble 170,747 11,440
Quaker Oats 14,616 1,156
R.R. Donnelley & Sons 17,500 430
Ralston-Ralston Purina Group 41,900 993
Safeway* 64,787 3,025
Sara Lee 125,628 2,552
Seagrams 56,026 3,218
Starbucks* 25,071 1,004
SUPERVALU 19,400 292
The accompanying notes are an integral part of the financial statements.
(42 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
EQUITY INDEX FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
Sysco 45,800 $ 2,121
Time Warner 172,622 13,508
Tricon Global Restaurants* 20,900 640
Tupperware 8,000 144
Unilever, ADR 75,914 3,663
UST 23,700 542
Viacom, Cl B* 199,725 11,684
Walgreen 138,516 5,255
Walt Disney 283,296 10,836
Wendy's International 16,600 333
William Wrigley Jr. 11,014 825
Winn Dixie Stores 20,300 292
------------
172,113
------------
ENERGY -- 5.7%
Amerada Hess 9,418 630
Anadarko Petroleum 32,310 2,147
Apache 15,877 939
Ashland Oil 9,800 330
Baker Hughes 45,600 1,693
Burlington Resources 30,200 1,112
Chevron 82,154 7,004
Conoco 86,800 2,338
Devon Energy 17,165 1,032
Exxon Mobil 458,759 40,887
Halliburton 61,300 3,000
Kerr-McGee 10,218 677
Occidental Petroleum 51,000 1,112
Phillips Petroleum 31,508 1,977
Rowan* 12,800 371
Royal Dutch Petroleum, ADR 282,810 16,951
Schlumberger 74,080 6,098
Sunoco 12,500 337
Texaco 73,697 3,869
Tosco 20,000 624
Transocean Sedco Forex 29,025 1,702
Unocal 33,600 1,191
USX-Marathon Group 43,100 1,223
------------
97,244
------------
FINANCIALS -- 15.4%
AFLAC 35,107 2,249
Allstate 105,864 3,679
American Express 177,420 10,778
American General 30,003 2,340
American International Group 304,209 29,109
Amsouth Bancorp 54,200 678
Aon 35,600 1,397
Associates First Capital 97,684 3,712
Bank of America 214,051 11,211
Bank of New York 99,850 5,598
Bank One 156,737 6,054
BB&T 53,594 1,615
Bear Stearns 13,753 866
C.I.T., Cl A 35,845 627
Capital One Financial 25,552 1,790
Charles Schwab 183,337 6,508
Charter One Financial 30,261 738
Chase Manhattan 172,253 7,956
Chubb 21,016 1,663
Cigna 18,479 1,929
Cincinnati Financial 22,793 809
Citigroup 599,604 32,416
EQUITY INDEX FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
Comerica 17,732 $ 1,036
Conseco 45,400 346
Countrywide Credit Industries 15,700 593
Fannie Mae 131,308 9,389
FHLMC 92,798 5,017
Fifth Third Bancorp 62,043 3,343
First Union 136,605 4,397
Firstar 135,900 3,041
Fleet Boston Financial 123,181 4,804
Franklin Resources 34,356 1,526
Golden West Financial 19,890 1,067
Hartford Financial Services Group 28,802 2,101
Household International 62,643 3,547
Huntington Bancshares 34,870 512
J.P. Morgan 16,867 2,756
Jefferson-Pilot 11,369 772
KeyCorp 62,000 1,569
Lehman Brothers Holdings 15,216 2,248
Lincoln National 25,257 1,215
Loew's 9,432 786
Marsh & McLennan 33,920 4,503
MBIA 11,454 815
MBNA 115,356 4,441
Mellon Financial 67,529 3,132
Merrill Lynch 103,922 6,859
MGIC Investment 13,657 835
Morgan Stanley Dean Witter 147,874 13,521
National City 85,500 1,892
Northern Trust 26,835 2,385
Old Kent Financial 19,320 559
Paine Webber Group 19,298 1,315
PNC Bank 34,727 2,257
Progressive 8,314 681
Providian Financial 17,284 2,195
Regions Financial 30,300 687
Safeco 18,000 491
SouthTrust 23,300 732
St. Paul Companies 29,500 1,455
State Street 18,592 2,417
Stilwell Financial* 29,704 1,292
Summit Bancorp 24,200 835
Suntrust Banks 35,785 1,783
Synovus Financial 38,800 822
T. Rowe Price 16,600 779
Torchmark 18,200 506
U.S. Bancorp 104,500 2,377
Union Planters 19,600 648
UnumProvident 33,300 907
USA Education 21,259 1,024
Wachovia 20,591 1,167
Washington Mutual 76,505 3,046
Wells Fargo 219,321 10,075
------------
260,220
------------
HEALTH CARE -- 11.1%
Abbott Laboratories 209,939 9,985
Aetna 17,565 1,020
Allergan 16,678 1,408
Alza, Cl A* 14,630 1,265
American Home Products 174,132 9,849
Amgen* 135,754 9,479
Bausch & Lomb 6,865 267
Baxter International 36,074 2,879
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 43)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
EQUITY INDEX FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
Becton Dickinson 34,900 $ 923
Biogen* 19,080 1,164
Biomet 23,400 819
Boston Scientific* 57,500 945
Bristol-Myers Squibb 260,449 14,878
C.R. Bard 6,772 286
Eli Lilly 148,515 12,048
Guidant* 39,996 2,827
HCA 77,156 2,864
HEALTHSOUTH* 53,600 436
Humana* 23,200 249
Johnson & Johnson 180,242 16,931
Mallinckrodt 9,014 411
Manor Care* 14,300 224
MedImmune* 27,584 2,131
Medtronic 159,957 8,288
Merck 302,979 22,553
Pfizer 844,117 37,933
Pharmacia 172,302 10,370
Quintiles Transnational* 15,900 253
Schering Plough 196,454 9,135
St. Jude Medical* 11,529 588
Tenet Healthcare* 43,300 1,575
United Healthcare 20,111 1,986
Watson Pharmaceuticals* 13,071 848
Wellpoint Health Networks* 6,237 599
------------
187,416
------------
TECHNOLOGY -- 29.3%
Adaptec* 14,400 288
ADC Telecommunications* 83,398 2,243
Adobe Systems 15,409 2,392
Advanced Micro Devices* 41,520 981
Agilent Technologies* 60,048 2,939
Altera* 53,808 2,569
America Online* 305,739 16,433
Analog Devices* 46,788 3,863
Andrew* 11,200 293
Apple Computer* 43,138 1,111
Applied Materials* 107,289 6,364
Autodesk 8,500 216
Automatic Data Processing 82,676 5,529
BMC Software* 33,900 648
Broadcom, Cl A* 29,133 7,101
Cabletron Systems* 25,300 743
Ceridian* 20,100 564
Cisco Systems* 939,371 51,900
Citrix Systems* 24,900 500
Compaq Computer 230,921 6,369
Computer Associates International 79,774 2,009
Computer Sciences* 20,937 1,555
Compuware* 50,000 419
Comverse Technology* 20,140 2,175
Conexant Systems* 29,800 1,248
Corning 38,558 11,452
Dell Computer* 344,734 10,622
Eastman Kodak 36,917 1,509
Electronic Data Systems 61,509 2,553
EMC* 288,271 28,575
Equifax 19,600 528
PFPC 56,011 2,188
EQUITY INDEX FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
Gateway* 42,293 $ 1,977
Hewlett Packard 130,376 12,646
IBM 230,706 25,954
Intel 889,799 36,982
JDS Uniphase* 123,864 11,728
KLA Tencor* 24,431 1,006
Lexmark International, Cl A* 16,293 611
Linear Technology 40,970 2,653
LSI Logic* 41,911 1,226
Lucent Technologies 441,967 13,508
Maxim Integrated Products* 36,894 2,968
Mercury Interactive* 10,562 1,656
Micron Technology* 74,596 3,431
Microsoft* 695,648 41,956
Motorola 292,667 8,268
National Semiconductor* 23,866 961
NCR* 13,400 507
Network Appliance* 41,260 5,255
Nortel Networks 395,957 23,584
Novell* 45,300 450
Novellus Systems* 17,693 824
Oracle Systems* 372,994 29,373
Palm* 75,488 3,996
Parametric Technology* 38,100 417
Paychex 50,763 2,665
PE Corp-PE Biosystems Group 27,216 3,171
Peoplesoft* 37,200 1,039
Perkinelmer 5,980 624
Polaroid 6,200 83
QUALCOMM* 98,307 7,004
Raytheon, Cl B 46,900 1,334
Sabre Holdings* 17,964 520
Sapient* 15,830 644
Scientific-Atlanta 21,060 1,340
Seagate Technology* 30,076 2,075
Siebel Systems* 54,042 6,016
Sun Microsystems* 209,460 24,454
Tektronix 5,819 447
Tellabs* 53,887 2,573
Teradyne* 22,810 798
Texas Instruments 229,551 10,832
Unisys* 43,100 485
Veritas Software* 52,988 7,524
W.W. Grainger 12,900 339
Xerox 92,100 1,387
Xilinx* 43,172 3,697
Yahoo* 72,288 6,578
------------
495,445
------------
TRANSPORTATION -- 0.5%
AMR* 20,500 670
Burlington Northern Santa Fe 62,397 1,345
CSX 30,300 661
Delta Air Lines 14,941 663
FedEx* 39,704 1,760
Norfolk Southern 53,000 775
Ryder System 8,200 151
Southwest Airlines 69,900 1,695
U.S. Air Group* 9,071 276
Union Pacific 33,573 1,305
------------
9,301
------------
The accompanying notes are an integral part of the financial statements.
(44 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
EQUITY INDEX FUND (CONTINUED)
DESCRIPTION SHARES/PAR (000) VALUE (000)
--------------------------------------------------------------------
UTILITIES -- 3.2%
AES* 60,233 $ 4,126
Ameren 19,000 796
American Electric Power 44,600 1,745
Cinergy 22,000 727
CMS Energy 16,100 434
Coastal 27,708 2,054
Columbia Gas Systems 8,812 626
Consolidated Edison 30,600 1,044
Constellation Energy 20,700 1,030
CP&L Energy 22,100 921
Dominion Resources of Virginia 28,937 1,680
DTE Energy 20,100 769
Duke Power 45,181 3,874
Eastern Enterprises 2,500 160
Edison International 48,100 929
El Paso Energy 30,731 1,894
Enron 97,182 8,516
Entergy 34,200 1,274
FirstEnergy 32,300 870
Florida Progress 12,210 646
FPL Group 19,679 1,294
GPU 17,100 555
Keyspan 18,131 728
Niagara Mohawk Holdings* 24,600 387
Nicor 6,500 235
ONEOK 4,300 171
PECO Energy 22,028 1,334
Peoples Energy 4,900 164
PG&E 53,200 1,287
Pinnacle West Capital 11,800 600
PPL Corporation 19,900 831
Public Service Enterprise Group 30,300 1,354
Reliant Energy 41,000 1,907
Sempra Energy 28,300 589
Southern 93,300 3,026
Texas Utilities 37,824 1,499
Unicom 23,189 1,303
Williams 60,279 2,547
Xcel Energy 46,300 1,273
------------
55,199
------------
TOTAL COMMON STOCKS
(Cost $950,734) 1,670,109
------------
U.S. TREASURY OBLIGATIONS -- 0.2%
U. S. Treasury Bill
6.11%, 12/14/00 (A) $ 3,500 3,457
------------
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $3,457) 3,457
------------
RELATED PARTY MONEY MARKET FUND -- 1.2%
First American Prime Obligations Fund (B) 19,860,687 19,861
------------
TOTAL RELATED PARTY MONEY MARKET FUND
(Cost $19,861) 19,861
------------
TOTAL INVESTMENTS -- 100.2%
(Cost $974,052) 1,693,427
------------
OTHER ASSETS AND LIABILITIES, NET -- (0.2%) (C) (3,258)
------------
EQUITY INDEX FUND (CONCLUDED)
DESCRIPTION VALUE (000)
--------------------------------------------------------------------
NET ASSETS:
Portfolio Capital--Class A ($0.0001 par value--
2 billion authorized) based on 4,835,354
outstanding shares $ 108,895
Portfolio Capital--Class B ($0.0001 par value--
2 billion authorized) based on 4,405,356
outstanding shares 98,080
Portfolio Capital--Class C ($0.0001 par value--
2 billion authorized) based on 1,258,657
outstanding shares 33,864
Portfolio Capital--Class Y ($0.0001 par value--
2 billion authorized) based on 50,475,118
outstanding shares 699,227
Undistributed net investment income 335
Accumulated net realized gain on investments 30,774
Net unrealized appreciation of investments and
open futures contracts 718,994
-------------
TOTAL NET ASSETS -- 100.0% $1,690,169
-------------
Net asset value and redemption price per
share -- Class A $ 27.75
Maximum sales charge of 5.25% (D) 1.54
-------------
Offering price per share -- Class A $ 29.29
-------------
Net asset value and offering price per
share -- Class B (E) $ 27.49
-------------
Net asset value and redemption price per
share -- Class C (F) $ 27.66
Maximum sales charge of 1.00% (G) 0.28
-------------
Offering price per share-- Class C $ 27.94
-------------
Net asset value, offering price, and redemption
price per share-- Class Y $ 27.74
-------------
*Non-income producing security
(A) Security has been deposited as initial margin on open futures contracts.
Yield shown is effective yield at date of purchase.
(B) This money market fund is advised by U.S. Bank National Association who also
serves as advisor for this fund. See the notes to the financial statements.
(C) Other assets and liabilities representing greater than five percent of total
net assets include the following (000):
Collateral received for securities loaned, at value $ 326,708
Payable upon return of securities loaned $(326,708)
(D) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 5.25%.
(E) Class B has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(F) Class C has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(G) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 1.00%.
ADR--American Depositary Receipt
Cl--Class
FHLMC--Federal Home Loan Mortgage Corporation
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 45)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
LARGE CAP GROWTH FUND
DESCRIPTION SHARES VALUE (000)
---------------------------------------------------------------------
COMMON STOCKS -- 98.2%
BASIC MATERIALS -- 1.3%
Ecolab 478,605 $ 17,260
-------------
CAPITAL GOODS -- 4.4%
General Electric 1,036,750 59,807
-------------
COMMUNICATION SERVICES -- 5.2%
AT&T Wireless* 407,000 8,496
Nextel Communications, Cl A* 638,000 29,826
Nextlink Communications, Cl A* 656,090 23,086
Vodafone, ADR 262,085 9,697
-------------
71,105
-------------
CONSUMER CYCLICALS -- 8.2%
Best Buy* 396,600 25,234
Home Depot 355,297 18,853
Kohls* 175,225 10,108
Omnicom Group 230,250 16,794
Wal-Mart Stores 880,860 42,391
-------------
113,380
-------------
CONSUMER STAPLES -- 3.9%
Cox Communications* 328,650 12,571
Walgreen 1,084,080 41,127
-------------
53,698
-------------
ENERGY -- 4.8%
Nabors Industries* 281,100 14,730
Schlumberger 334,625 27,544
Transocean Sedco Forex 412,990 24,212
-------------
66,486
-------------
FINANCIALS -- 7.3%
American Express 359,965 21,868
American International Group 172,630 16,519
Bank of New York 288,400 16,168
Charles Schwab 407,250 14,457
Citigroup 279,066 15,087
Morgan Stanley Dean Witter 182,900 16,724
-------------
100,823
-------------
HEALTH CARE -- 15.0%
Amgen* 218,790 15,278
Bristol-Myers Squibb 223,110 12,745
Genentech* 132,080 24,526
Guidant* 493,345 34,873
Johnson & Johnson 274,455 25,782
Medtronic 536,970 27,822
Merck 334,900 24,929
Pfizer 753,150 33,845
Protein Design Laboratories* 55,190 6,650
-------------
206,450
-------------
LARGE CAP GROWTH FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
---------------------------------------------------------------------
TECHNOLOGY -- 39.4%
America Online* 412,960 $ 22,197
Applied Materials* 129,400 7,675
Automatic Data Processing 232,500 15,548
Broadcom, Cl A* 91,420 22,284
Broadvision* 215,300 5,530
Brocade Communications Systems* 105,110 24,806
Cisco Systems* 875,428 48,367
Corning 47,730 14,176
Dell Computer* 351,600 10,834
EMC* 510,560 50,609
Intel 724,580 30,115
JDS Uniphase* 189,100 17,905
Lucent Technologies 410,547 12,547
Microsoft* 543,140 32,758
Motorola 411,525 11,626
Nokia, ADR 484,320 19,282
Nortel Networks 409,110 24,368
Oracle Systems* 595,400 46,888
PE Corp-PE Biosystems Group 109,620 12,771
PMC-Sierra* 89,250 19,211
Siebel Systems* 72,540 8,075
Sun Microsystems* 235,860 27,537
Texas Instruments 232,530 10,972
VeriSign* 107,850 21,846
Veritas Software* 169,550 24,076
-------------
542,003
-------------
TRANSPORTATION -- 2.3%
Southwest Airlines 741,772 17,988
United Parcel Service 234,900 13,242
-------------
31,230
-------------
UTILITIES -- 6.4%
AES* 457,050 31,308
Enron 649,130 56,880
-------------
88,188
-------------
TOTAL COMMON STOCKS
(Cost $829,348) 1,350,430
-------------
RELATED PARTY MONEY MARKET FUND -- 1.9%
First American Prime Obligations Fund (A) 26,073,585 26,074
-------------
TOTAL RELATED PARTY MONEY MARKET FUND
(Cost $26,074) 26,074
-------------
TOTAL INVESTMENTS -- 100.1%
(Cost $855,422) 1,376,504
-------------
OTHER ASSETS AND LIABILITIES, NET -- (0.1%) (B) (2,016)
-------------
The accompanying notes are an integral part of the financial statements.
(46 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
LARGE CAP GROWTH FUND (CONCLUDED)
DESCRIPTION VALUE (000)
---------------------------------------------------------------------
NET ASSETS:
Portfolio Capital--Class A ($0.0001 par value--
2 billion authorized) based on 9,675,725
outstanding shares $ 104,780
Portfolio Capital--Class B ($0.0001 par value--
2 billion authorized) based on 1,732,837
outstanding shares 29,805
Portfolio Capital--Class C ($0.0001 par value--
2 billion authorized) based on 823,587
outstanding shares 17,732
Portfolio Capital--Class Y ($0.0001 par value--
2 billion authorized) based on 51,189,710
outstanding shares 570,142
Accumulated net realized gain on investments 130,947
Net unrealized appreciation of investments 521,082
-------------
TOTAL NET ASSETS -- 100.0% $1,374,488
-------------
Net asset value and redemption price per
share -- Class A $ 21.55
Maximum sales charge of 5.25% (C) 1.19
-------------
Offering price per share -- Class A $ 22.74
-------------
Net asset value and offering price per
share -- Class B (D) $ 20.93
-------------
Net asset value and redemption price per
share -- Class C (E) $ 21.30
Maximum sales charge of 1.00% (F) 0.22
-------------
Offering price per share -- Class C $ 21.52
-------------
Net asset value, offering price, and redemption
price per share -- Class Y $ 21.73
-------------
* Non-income producing security
(A) This money market fund is advised by U.S. Bank National Association who also
serves as advisor for this fund. See also the notes to the financial
statements.
(B) Other assets and liabilities representing greater than 5% of total net
assets include the following (000):
Collateral received for securities loaned, at value $ 384,325\
Payable upon return of securities loaned $(384,325)
(C) The offering price is calculated by dividing the net assets value by 1 minus
the maximum sales charge of 5.25%.
(D) Class B has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(E) Class C has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(F) The offering price is calculated by dividing the net assets value by 1 minus
the maximum sales charge of 1.00%.
ADR--American Depositary Receipt
CI--Class
LARGE CAP VALUE FUND
DESCRIPTION SHARES VALUE (000)
---------------------------------------------------------------------
COMMON STOCKS -- 97.7%
BASIC MATERIALS -- 6.5%
Alcoa 958,800 $ 24,270
Dow Chemical 1,269,600 31,661
International Paper 747,400 21,441
Praxair 329,700 12,323
-------------
89,695
-------------
CAPITAL GOODS -- 5.6%
Caterpillar 381,800 12,886
Honeywell International 778,700 27,741
Minnesota Mining & Manufacturing 409,900 37,352
-------------
77,979
-------------
COMMUNICATION SERVICES -- 6.8%
SBC Communications 628,226 31,411
Verizon Communications 784,012 37,976
Worldcom* 793,600 24,106
-------------
93,493
-------------
CONSUMER CYCLICALS -- 5.5%
Federated Department Stores* 748,800 19,562
Ford Motor 510,091 12,912
General Motors 221,800 14,417
Masco 751,100 13,989
Nike, Cl B 373,100 14,947
-------------
75,827
-------------
CONSUMER STAPLES -- 9.5%
Albertson's 984,100 20,666
General Mills 635,200 22,550
Kimberly Clark 492,300 27,476
McDonald's 725,800 21,910
Procter & Gamble 270,400 18,117
Walt Disney 538,100 20,582
-------------
131,301
-------------
ENERGY -- 12.6%
Exxon Mobil 588,300 52,432
Halliburton 790,100 38,665
Royal Dutch Petroleum, ADR 653,200 39,151
Schlumberger 130,700 10,758
Texaco 405,900 21,310
Transocean Sedco Forex 188,100 11,027
-------------
173,343
-------------
FINANCIALS -- 29.0%
Allstate 1,035,200 35,973
American Express 481,600 29,257
American International Group 350,400 33,529
Associates First Capital 553,500 21,033
Bank of America 592,800 31,048
Bank One 722,500 27,907
Chase Manhattan 704,000 32,516
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 47)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
LARGE CAP VALUE FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
---------------------------------------------------------------------
Citigroup 732,266 $ 39,588
Fannie Mae 629,800 45,031
Fleet Boston Financial 843,401 32,893
Mellon Financial 636,500 29,518
Morgan Stanley Dean Witter 133,900 12,243
Wells Fargo 665,000 30,548
-------------
401,084
-------------
HEALTH CARE -- 5.4%
American Home Products 292,700 16,556
Bristol-Myers Squibb 554,400 31,670
Pharmacia 440,391 26,506
-------------
74,732
-------------
TECHNOLOGY -- 11.1%
BMC Software* 400,000 7,650
Compaq Computer 839,000 23,140
Computer Associates International 573,500 14,445
Electronic Data Systems 649,100 26,938
PFPC 535,500 20,918
Hewlett Packard 195,600 18,973
IBM 177,256 19,941
Motorola 763,700 21,574
-------------
153,579
-------------
TRANSPORTATION -- 1.5%
Delta Air Lines 455,400 20,208
-------------
UTILITIES -- 4.2%
Duke Power 299,100 25,648
Edison International 682,300 13,177
Public Service Enterprise Group 433,400 19,368
-------------
58,193
-------------
TOTAL COMMON STOCKS
(Cost $1,264,879) 1,349,434
-------------
RELATED PARTY MONEY MARKET FUND -- 2.5%
First American Prime Obligations Fund (A) 34,137,629 34,138
-------------
TOTAL RELATED PARTY MONEY MARKET FUND
(Cost $34,138) 34,138
-------------
TOTAL INVESTMENTS -- 100.2%
(Cost $1,299,017) 1,383,572
-------------
OTHER ASSETS AND LIABILITIES, NET -- (0.2%) (B) (2,426)
-------------
LARGE CAP VALUE FUND (CONCLUDED)
DESCRIPTION VALUE (000)
---------------------------------------------------------------------
NET ASSETS:
Portfolio Capital--Class A ($0.0001 par value--
2 billion authorized) based on 6,710,139
outstanding shares $ 110,751
Portfolio Capital--Class B ($0.0001 par value--
2 billion authorized) based on 2,447,008
outstanding shares 56,007
Portfolio Capital--Class C ($0.0001 par value--
2 billion authorized) based on 319,420
outstanding shares 6,879
Portfolio Capital--Class Y ($0.0001 par value--
2 billion authorized) based on 57,499,446
outstanding shares 1,005,847
Undistributed net investment income 383
Accumulated net realized gain on investments 116,724
Net unrealized appreciation of investments 84,555
-------------
TOTAL NET ASSETS -- 100.0% $1,381,146
-------------
Net asset value and redemption price per
share -- Class A $ 20.59
Maximum sales charge of 5.25% (C) 1.14
-------------
Offering price per share -- Class A $ 21.73
-------------
Net asset value and offering price per
share -- Class B (D) $ 20.30
-------------
Net asset value and redemption price per
share -- Class C (E) $ 20.51
Maximum sales charge of 1.00% (F) 0.21
-------------
Offering price per share -- Class C $ 20.72
-------------
Net asset value, offering price, and redemption
price per share -- Class Y $ 20.64
-------------
*Non-income producing security
(A) This money market fund is advised by U.S Bank National Association who also
serves as advisor for this fund. See also the notes to the financial
statements.
(B) Other assets and liabilities representing greater than five percent of total
net assets include the following (000):
Collateral received for securities loaned, at value $ 159,814
Payable upon return of securities loaned $(159,814)
(C) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 5.25%.
(D) Class B has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(E) Class C has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(F) The offering price is calcluated by dividing the net asset value by 1 minus
the maximum sales charge of 1.00%.
ADR--American Depositary Receipt
Cl--Class
The accompanying notes are an integral part of the financial statements.
(48 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
(This page has been left blank intentionally.)
<PAGE>
STATEMENTS OF OPERATIONS for the year ended September 30, 2000 in thousands
<TABLE>
<CAPTION>
BALANCED EQUITY INCOME EQUITY INDEX
FUND FUND FUND
---------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest $ 12,792+ $ 736+ $ 1,212+
Dividends 3,263 8,474 19,101
---------------------------------------------------------------------------------------------------
TOTAL INVESTMENT INCOME 16,055 9,210 20,313
===================================================================================================
EXPENSES:
Investment advisory fees 2,877 2,354 11,687
Less: Waiver of investment advisory fees (508) (478) (8,967)
Administrator fees 447 366 1,816
Transfer agent fees 276 113 481
Custodian fees 123 101 501
Directors' fees 7 5 26
Registration fees 19 14 74
Professional fees 10 8 40
Printing 27 22 110
Distribution fees - Class A 153 50 330
Distribution fees - Class B 545 108 1,182
Distribution fees - Class C 15 23 283
Other 9 17 79
---------------------------------------------------------------------------------------------------
TOTAL NET EXPENSES 4,000 2,703 7,642
===================================================================================================
Investment income (loss) - net 12,055 6,507 12,671
---------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAINS/(LOSSES)
ON INVESTMENTS - NET:
Net realized gain on investments 19,385 30,881 33,504
Net realized loss on futures contracts -- -- (1,336)
Net change in unrealized appreciation or depreciation
of investments (14,819) (1,467) 134,082
Net change in unrealized appreciation or depreciation
of futures contracts -- -- (254)
---------------------------------------------------------------------------------------------------
NET GAIN ON INVESTMENTS 4,566 29,414 165,996
===================================================================================================
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $ 16,621 $ 35,921 $178,667
===================================================================================================
</TABLE>
+Includes income from securities lending program. See the Notes to the Financial
Statements for additional information.
The accompanying notes are an integral part of the financial statements.
(50 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
<TABLE>
<CAPTION>
LARGE CAP LARGE CAP
GROWTH FUND VALUE FUND
-----------------------------
<S> <C>
$ 2,014+ $ 2,676+
5,586 25,096
-----------------------------
7,600 27,772
=============================
8,886 10,257
(1,073) (1,557)
1,380 1,594
337 703
381 440
20 23
55 59
31 35
84 97
498 393
305 559
43 26
60 70
-----------------------------
11,007 12,699
=============================
(3,407) 15,073
-----------------------------
134,538 118,158
-- --
136,297 (101,122)
-- --
-----------------------------
270,835 17,036
=============================
$267,428 $ 32,109
=============================
</TABLE>
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 51)
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS in thousands
<TABLE>
<CAPTION>
BALANCED EQUITY EQUITY
FUND INCOME FUND INDEX FUND
------------------------------------------------------------------------------------------------------------------------------------
10/1/99 10/1/98 10/1/99 10/1/98 10/1/99 10/1/98
to to to to to to
9/30/00 9/30/99 9/30/00 9/30/99 9/30/00 9/30/99
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Investment income (loss) - net $ 12,055 $ 15,560 $ 6,507 $ 9,432 $ 12,671 $ 14,804
Net realized gain on investments 19,385 51,628 30,881 26,002 33,504 30,503
Net realized gain (loss) on futures contracts -- -- -- -- (1,336) 10,534
Net change in unrealized appreciation/depreciation
of investments (14,819) (1,078) (1,467) 2,697 134,082 256,876
Net change in unrealized appreciation/depreciation
of futures contracts -- -- -- -- (254) 68
------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 16,621 66,110 35,921 38,131 178,667 312,785
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Investment income - net:
Class A (1,742) (2,106) (355) (334) (797) (758)
Class B (1,177) (1,271) (122) (162) (57) (193)
Class C (31) (9) (27) (9) (16) (16)
Class Y (9,131) (12,245) (6,079) (9,143) (11,786) (13,914)
Net realized gain on investments:
Class A (6,336) (8,756) (1,377) (662) (3,056) (1,099)
Class B (5,610) (6,690) (762) (506) (32,195) (996)
Class C (139) -- (129) -- (2,748) --
Class Y (30,348) (51,648) (23,576) (20,399) (520) (21,802)
------------------------------------------------------------------------------------------------------------------------------------
Total distributions (54,514) (82,725) (32,427) (31,215) (51,175) (38,778)
------------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS(1):
Class A
Proceeds from sales 9,966 14,035 7,332 12,345 51,652 73,519
Reinvestment of distributions 7,969 10,398 1,307 748 3,719 1,766
Payments for redemptions (27,434) (30,490) (7,386) (4,820) (41,677) (22,600)
------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from Class A
transactions (9,499) (6,057) 1,253 8,273 13,694 52,685
------------------------------------------------------------------------------------------------------------------------------------
Class B
Proceeds from sales 3,627 7,363 1,911 3,746 31,361 51,649
Reinvestment of distributions 6,629 7,765 838 628 2,741 1,165
Payments for redemptions (16,467) (11,704) (3,457) (2,006) (20,677) (8,302)
------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from Class B
transactions (6,211) 3,424 (708) 2,368 13,425 44,512
------------------------------------------------------------------------------------------------------------------------------------
Class C
Proceeds from sales 711 1,431 1,201 1,825 21,485 18,007
Reinvestment of distributions 169 9 150 8 519 15
Payment for redemptions (652) (1) (605) (11) (5,551) (611)
------------------------------------------------------------------------------------------------------------------------------------
Increase in net assets from Class C transactions 228 1,439 746 1,822 16,453 17,411
------------------------------------------------------------------------------------------------------------------------------------
Class Y
Proceeds from sales 78,638 96,438 31,895 58,353 487,404 451,693
Shares issued in connection with the acquisition
of Piper Common Trust Fund Assets -- -- -- -- -- --
Shares issued in connection with the acquisition of
Santa Monica Common Trust Fund Assets -- -- -- -- -- --
Reinvestment of distributions 37,847 60,180 3,772 3,371 37,337 32,110
Payments for redemptions (199,112) (249,834) (113,948) (77,863) (438,062) (526,652)
------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from Class Y
transactions (82,627) (93,216) (78,281) (16,139) 86,679 (42,849)
------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from capital share
transactions (98,109) (94,410) (76,990) (3,676) 130,251 71,759
------------------------------------------------------------------------------------------------------------------------------------
Total increase (decrease) in net assets (136,002) (111,025) (73,496) 3,240 257,743 345,766
NET ASSETS AT BEGINNING OF PERIOD 481,993 593,018 382,416 379,176 1,432,426 1,086,660
====================================================================================================================================
NET ASSETS AT END OF PERIOD (2) $ 345,991 $ 481,993 $ 308,920 $ 382,416 $1,690,169 $1,432,426
====================================================================================================================================
</TABLE>
The accompanying notes are an integral part of the financial statements.
(52 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
<TABLE>
<CAPTION>
LARGE CAP LARGE CAP
GROWTH FUND VALUE FUND
-------------------------------------------------------------
10/1/99 10/1/98 10/1/99 10/1/98
to to to to
9/30/00 9/30/99 9/30/00 9/30/99
-------------------------------------------------------------
<S> <C> <C> <C>
$ (3,407) $ 1,357 $ 15,073 $ 16,531
134,538 156,209 118,158 207,906
-- -- -- --
136,297 129,481 (101,122) 93,721
-- -- -- --
-------------------------------------------------------------
267,428 287,047 32,109 318,158
-------------------------------------------------------------
-- (282) (1,273) (1,621)
-- -- (145) (186)
-- -- (9) (1)
-- (2,625) (13,263) (15,248)
(25,025) (16,050) (20,882) (27,729)
(3,205) (1,316) (7,299) (9,199)
(192) -- (187) --
(130,098) (77,627) (156,215) (202,092) (1)See note 4 in the notes to the
------------------------------------------------------------- financial statements for
(158,520) (97,900) (199,273) (256,076) additional information.
-------------------------------------------------------------
(2)Includes undistributed net
investment income (000) of $269
48,259 54,798 32,480 31,078 and $295 for Balanced Fund, $139
23,087 15,252 20,538 24,964 and $198 for Equity Income Fund,
(47,999) (74,400) (71,108) (56,697) $335 and $320 for Equity Index
------------------------------------------------------------- Fund, and $0 and $0 for Large
Cap Growth Fund, and $383 and $0
23,347 (4,350) (18,090) (655) for Large Cap Value Fund, at
------------------------------------------------------------- September 30, 2000, and
September 30, 1999,
17,153 6,268 4,965 5,587 respectively.
3,127 1,295 7,337 9,240
(5,162) (2,449) (16,836) (11,602)
-------------------------------------------------------------
15,118 5,114 (4,534) 3,225
-------------------------------------------------------------
16,991 988 5,590 1,504
192 -- 190 1
(420) (19) (399) (7)
-------------------------------------------------------------
16,763 969 5,381 1,498
-------------------------------------------------------------
282,229 177,975 354,191 298,298
-- 9,808 -- --
10,581 -- -- --
43,249 21,807 101,147 121,404
(168,652) (189,793) (473,352) (382,918)
-------------------------------------------------------------
167,407 19,797 (18,014) 36,784
-------------------------------------------------------------
222,635 21,530 (35,257) 40,852
-------------------------------------------------------------
331,543 210,677 (202,421) 102,934
1,042,945 832,268 1,583,567 1,480,633
=============================================================
$1,374,488 $1,042,945 $1,381,146 $1,583,567
=============================================================
</TABLE>
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 53)
<PAGE>
FINANCIAL HIGHLIGHTS For a share outstanding throughout the periods ended
September 30, unless otherwise indicated
<TABLE>
<CAPTION>
REALIZED AND
NET ASSET UNREALIZED DIVIDENDS
VALUE NET GAINS OR FROM NET DISTRIBUTIONS
BEGINNING INVESTMENT (LOSSES) ON INVESTMENT FROM
OF PERIOD INCOME INVESTMENTS INCOME CAPITAL GAINS
------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
BALANCED FUND
Class A
2000 $ 13.46 $ 0.36 $ 0.24 $ (0.36) $ (1.25)
1999 13.98 0.38 1.07 (0.38) (1.59)
1998 15.41 0.40 (0.30) (0.41) (1.12)
1997 13.14 0.39 2.85 (0.39) (0.58)
1996 12.12 0.39 1.43 (0.39) (0.41)
Class B
2000 $ 13.40 $ 0.27 $ 0.22 $ (0.27) $ (1.25)
1999 13.93 0.28 1.06 (0.28) (1.59)
1998 15.36 0.30 (0.31) (0.30) (1.12)
1997 13.10 0.29 2.84 (0.29) (0.58)
1996 12.09 0.31 1.42 (0.31) (0.41)
Class C
2000 $ 13.45 $ 0.28 $ 0.22 $ (0.27) $ (1.25)
1999(1) 13.69 $ 0.23 (0.25) (0.22) --
Class Y
2000 $ 13.50 $ 0.39 $ 0.23 $ (0.39) $ (1.25)
1999 14.01 0.41 1.08 (0.41) (1.59)
1998 15.43 0.44 (0.30) (0.44) (1.12)
1997 13.15 0.42 2.86 (0.42) (0.58)
1996 12.13 0.42 1.43 (0.42) (0.41)
------------------------------------------------------------------------------------
EQUITY INCOME FUND
Class A
2000 $ 15.94 $ 0.28 $ 1.45 $ (0.28) $ (1.10)
1999 15.70 0.36 1.15 (0.37) (0.90)
1998 15.69 0.41 0.86 (0.41) (0.85)
1997 12.65 0.40 3.40 (0.41) (0.35)
1996 11.24 0.39 1.42 (0.39) (0.01)
Class B
2000 $ 15.90 $ 0.18 $ 1.44 $ (0.18) $ (1.10)
1999 15.65 0.24 1.16 (0.25) (0.90)
1998 15.62 0.30 0.87 (0.29) (0.85)
1997 12.61 0.29 3.37 (0.30) (0.35)
1996 11.20 0.31 1.42 (0.31) (0.01)
Class C
2000 $ 15.93 $ 0.19 $ 1.44 $ (0.18) $ (1.10)
1999(1) 16.62 0.21 (0.70) (0.20) --
Class Y
2000 $ 16.00 $ 0.32 $ 1.47 $ (0.32) $ (1.10)
1999 15.74 0.40 1.17 (0.41) (0.90)
1998 15.70 0.46 0.88 (0.45) (0.85)
1997 12.66 0.43 3.40 (0.44) (0.35)
1996 11.24 0.42 1.43 (0.42) (0.01)
------------------------------------------------------------------------------------
EQUITY INDEX FUND
Class A
2000 $ 25.52 $ 0.17 $ 2.91 $ (0.17) $ (0.68)
1999 20.61 0.21 5.36 (0.22) (0.44)
1998 20.76 0.24 1.39 (0.24) (1.54)
1997 15.49 0.12 5.70 (0.12) (0.43)
1996 13.35 0.27 2.32 (0.27) (0.18)
Class B
2000 $ 25.34 $ 0.00 $ 2.84 $ (0.01) $ (0.68)
1999 20.49 0.05 5.30 (0.06) (0.44)
1998 20.67 0.09 1.36 (0.09) (1.54)
1997 15.43 0.12 5.67 (0.12) (0.43)
1996 13.30 0.17 2.31 (0.17) (0.18)
Class C
2000 $ 25.48 $ 0.00 $ 2.88 $ (0.02) $ (0.68)
1999(1) 25.35 0.06 0.13 (0.06) --
Class Y
2000 $ 25.51 $ 0.23 $ 2.91 $ (0.23) $ (0.68)
1999 20.60 0.28 5.35 (0.28) (0.44)
1998 20.74 0.29 1.40 (0.29) (1.54)
1997 15.47 0.29 5.70 (0.29) (0.43)
1996 13.34 0.31 2.31 (0.31) (0.18)
------------------------------------------------------------------------------------
</TABLE>
+Returns are for the period indicated and have not been annualized.
(A)Excluding sales charges.
(1)Class C shares have been offered since February 1, 1999. All ratios for the
period have been annualized.
The accompanying notes are an integral part of the financial statements.
(54 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
<TABLE>
<CAPTION>
RATIO OF RATIO OF NET
RATIO OF NET EXPENSES TO INVESTMENT INCOME
NET ASSET RATIO OF INVESTMENT AVERAGE TO AVERAGE
VALUE NET ASSETS EXPENSES TO INCOME TO NET ASSETS NET ASSETS PORTFOLIO
END OF TOTAL END OF AVERAGE AVERAGE (EXCLUDING (EXCLUDING TURNOVER
PERIOD RETURN (A) PERIOD (000) NET ASSETS NET ASSETS WAIVERS) WAIVERS) RATE
----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 12.45 4.50% $ 54,605 1.05% 2.86% 1.17% 2.74% 65%
13.46 10.75 69,753 1.05 2.69 1.16 2.58 77
13.98 0.72 78,269 1.05 2.82 1.15 2.72 103
15.41 25.80 32,309 1.05 2.74 1.13 2.66 84
13.14 15.61 20,927 1.05 3.05 1.14 2.96 73
$ 12.37 3.59% $ 49,457 1.80% 2.11% 1.92% 1.99% 65%
13.40 9.94 60,623 1.80 1.94 1.91 1.83 77
13.93 (0.02) 59,323 1.80 2.02 1.90 1.92 103
15.36 24.93 43,707 1.80 1.99 1.88 1.91 84
13.10 14.78 15,542 1.80 2.32 1.89 2.23 73
$ 12.43 3.65% $ 1,499 1.80% 2.11% 1.92% 1.99% 65%
13.45 (0.21)+ 1,388 1.81 2.05 1.91 1.95 77
$ 12.48 4.67% $ 240,430 0.80% 3.11% 0.92% 2.99% 65%
13.50 11.07 350,229 0.80 2.93 0.91 2.82 77
14.01 1.03 455,426 0.80 3.01 0.90 2.91 103
15.43 26.17 418,087 0.80 2.99 0.88 2.91 84
13.15 15.89 332,786 0.80 3.31 0.89 3.22 73
----------------------------------------------------------------------------------------------------------------------
$ 16.29 11.11% $ 20,607 1.00% 1.69% 1.14% 1.55% 36%
15.94 9.74 18,970 1.00 2.01 1.13 1.88 35
15.70 8.38 11,018 1.00 2.58 1.12 2.46 14
15.69 31.16 7,276 1.00 2.96 1.17 2.79 39
12.65 16.41 2,581 1.00 3.25 1.20 3.05 23
$ 16.24 10.35% $ 10,366 1.75% 0.95% 1.89% 0.81% 36%
15.90 9.10 10,971 1.75 1.34 1.88 1.21 35
15.65 7.77 8,570 1.75 1.81 1.87 1.69 14
15.62 30.06 6,619 1.75 2.19 1.92 2.02 39
12.61 15.66 3,770 1.75 2.49 1.95 2.29 23
$ 16.28 10.41% $ 2,511 1.75% 0.88% 1.89% 0.74% 36%
15.93 (3.02)+ 1,700 1.76 0.65 1.88 0.53 35
$ 16.37 11.46% $ 275,436 0.75% 1.99% 0.89% 1.85% 36%
16.00 10.10 350,775 0.75 2.38 0.88 2.25 35
15.74 8.85 359,588 0.75 2.81 0.87 2.69 14
15.70 31.45 369,919 0.75 3.12 0.92 2.95 39
12.66 16.79 64,590 0.75 3.50 0.95 3.30 23
----------------------------------------------------------------------------------------------------------------------
$ 27.75 12.11% $ 134,180 0.60% 0.62% 1.14% 0.08% 16%
25.52 27.30 110,439 0.60 0.85 1.14 0.31 7
20.61 8.50 46,010 0.60 1.11 1.13 0.58 14
20.76 39.47 15,977 0.60 1.36 1.13 0.83 8
15.49 19.75 6,221 0.60 1.87 1.15 1.32 10
$ 27.49 11.25% $ 121,092 1.35% (0.13)% 1.89% (0.67)% 16%
25.34 26.38 99,054 1.35 0.10 1.89 (0.44) 7
20.49 7.66 44,122 1.35 0.37 1.88 (0.16) 14
20.67 38.45 23,733 1.35 0.61 1.88 0.08 8
15.43 18.95 8,252 1.35 1.11 1.90 0.56 10
$ 27.66 11.32% $ 34,811 1.35% (0.13)% 1.89% (0.67)% 16%
25.48 0.76+ 16,861 1.35 0.07 1.89 (0.47) 7
$ 27.74 12.38% $1,400,086 0.35% 0.87% 0.89% 0.33% 16%
25.51 27.61 1,206,072 0.35 1.11 0.89 0.57 7
20.60 8.82 996,528 0.35 1.36 0.88 0.83 14
20.74 39.85 557,258 0.35 1.62 0.88 1.09 8
15.47 19.98 348,539 0.35 2.14 0.90 1.59 10
----------------------------------------------------------------------------------------------------------------------
</TABLE>
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 55)
<PAGE>
FINANCIAL HIGHLIGHTS For a share outstanding throughout the periods ended
September 30, unless otherwise indicated
<TABLE>
<CAPTION>
REALIZED AND
NET ASSET UNREALIZED DIVIDENDS
VALUE NET GAINS OR FROM NET DISTRIBUTIONS
BEGINNING INVESTMENT (LOSSES) ON INVESTMENT FROM
OF PERIOD INCOME (LOSS) INVESTMENTS INCOME CAPITAL GAINS
---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
LARGE CAP GROWTH FUND
Class A
2000 $ 19.75 $ (0.09) $ 4.87 $ -- $ (2.98)
1999 16.25 0.02 5.39 (0.03) (1.88)
1998 17.63 0.09 (0.02) (0.09) (1.36)
1997 13.63 0.09 4.28 (0.10) (0.27)
1996 11.75 0.15 1.88 (0.15) --
Class B
2000 $ 19.38 $ (0.22) $ 4.75 $ -- $ (2.98)
1999 16.06 0.07 5.13 -- (1.88)
1998 17.47 0.03 (0.05) (0.03) (1.36)
1997 13.57 0.01 4.18 (0.02) (0.27)
1996 11.73 0.08 1.84 (0.08) --
Class C
2000 $ 19.67 $ (0.09) $ 4.70 $ -- $ (2.98)
1999(1) 18.56 0.01 1.11 (0.01) --
Class Y
2000 $ 19.84 $ (0.04) $ 4.91 $ -- $ (2.98)
1999 16.30 0.02 5.46 (0.06) (1.88)
1998 17.64 0.13 0.02 (0.13) (1.36)
1997 13.66 0.12 4.26 (0.13) (0.27)
1996 11.78 0.18 1.88 (0.18) --
---------------------------------------------------------------------------------------
LARGE CAP VALUE FUND
Class A
2000 $ 23.12 $ 0.17 $ 0.22 $ (0.17) $ (2.75)
1999 22.39 0.19 4.44 (0.20) (3.70)
1998 28.74 0.29 (2.59) (0.29) (3.76)
1997 22.59 0.33 7.90 (0.32) (1.76)
1996 19.57 0.36 4.07 (0.36) (1.05)
Class B
2000 $ 22.87 $ 0.05 $ 0.18 $ (0.05) $ (2.75)
1999 22.21 0.07 4.36 (0.07) (3.70)
1998 28.55 0.13 (2.58) (0.13) (3.76)
1997 22.50 0.18 7.81 (0.18) (1.76)
1996 19.49 0.22 4.06 (0.22) (1.05)
Class C
2000 $ 23.09 $ 0.06 $ 0.17 $ (0.06) $ (2.75)
1999(1) 22.79 0.08 0.30 (0.08) --
Class Y
2000 $ 23.17 $ 0.23 $ 0.21 $ (0.22) $ (2.75)
1999 22.42 0.25 4.46 (0.26) (3.70)
1998 28.75 0.35 (2.57) (0.35) (3.76)
1997 22.60 0.39 7.90 (0.38) (1.76)
1996 19.56 0.42 4.09 (0.42) (1.05)
---------------------------------------------------------------------------------------
</TABLE>
+Returns are for the period indicated and have not been annualized.
(A)Excluding sales charges.
(1)Class C shares have been offered since February 1, 1999. All ratios for the
period have been annualized.
The accompanying notes are an integral part of the financial statements.
(56 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
<TABLE>
<CAPTION>
RATIO OF RATIO OF NET
RATIO OF NET EXPENSES TO INVESTMENT INCOME
NET ASSET RATIO OF INVESTMENT AVERAGE (LOSS) TO AVERAGE
VALUE NET ASSETS EXPENSES TO INCOME (LOSS) NET ASSETS NET ASSETS PORTFOLIO
END OF TOTAL END OF AVERAGE TO AVERAGE (EXCLUDING (EXCLUDING TURNOVER
PERIOD RETURN (A) PERIOD (000) NET ASSETS NET ASSETS WAIVERS) WAIVERS) RATE
------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 21.55 25.74% $ 208,556 1.05% (0.45)% 1.14% (0.54)% 47%
19.75 36.00 168,153 1.05 (0.05) 1.14 (0.14) 57
16.25 0.61 140,948 1.05 0.56 1.11 0.50 38
17.63 32.69 12,017 1.05 0.57 1.14 0.48 34
13.63 17.38 5,318 1.04 1.13 1.17 1.00 21
$ 20.93 24.84% $ 36,272 1.80% (1.20)% 1.89% (1.29)% 47%
19.38 34.99 19,011 1.80 (0.83) 1.89 (0.92) 57
16.06 0.09 11,177 1.80 (0.20) 1.86 (0.26) 38
17.47 31.42 9,487 1.80 (0.18) 1.89 (0.27) 34
13.57 16.41 5,775 1.79 0.36 1.92 0.23 21
$ 21.30 24.89% $ 17,538 1.80% (1.20)% 1.89% (1.29)% 47%
19.67 6.04+ 962 1.80 (1.09) 1.89 (1.18) 57
$ 21.73 26.13% $1,112,122 0.80% (0.20)% 0.89% (0.29)% 47%
19.84 36.36 854,819 0.80 0.20 0.89 0.11 57
16.30 1.07 680,143 0.80 0.82 0.86 0.76 38
17.64 32.75 681,151 0.80 0.77 0.89 0.68 34
13.66 17.58 225,900 0.79 1.39 0.92 1.26 21
------------------------------------------------------------------------------------------------------------------------
$ 20.59 0.92% $ 138,146 1.05% (0.45)% 1.13% (0.53)% 68%
23.12 21.93 177,251 1.05 0.82 1.15 0.72 61
22.39 (8.77) 170,529 1.05 1.21 1.13 1.13 74
28.74 38.82 50,381 1.05 1.14 1.14 1.05 57
22.59 23.90 22,965 1.05 1.64 1.13 1.56 40
$ 20.30 0.17% $ 49,662 1.80% (1.20)% 1.88% (1.28)% 68%
22.87 21.07 61,711 1.80 0.07 1.90 (0.03) 61
22.21 (9.37) 56,259 1.80 0.41 1.88 0.33 74
28.55 37.71 53,420 1.80 0.39 1.89 0.30 57
22.50 23.08 23,316 1.80 0.89 1.88 0.81 40
$ 20.51 0.17% $ 6,551 1.80% (1.20)% 1.88% (1.28)% 68%
23.09 1.65+ 1,398 1.80 0.00 1.90 (0.10) 61
$ 20.64 1.17% $1,186,787 0.80% (0.20)% 0.88% (0.28)% 68%
23.17 22.28 1,343,207 0.80 1.07 0.90 0.97 61
22.42 (8.47) 1,253,845 0.80 1.40 0.88 1.32 74
28.75 39.13 1,095,262 0.80 1.39 0.89 1.30 57
22.60 24.32 471,206 0.80 1.90 0.88 1.82 40
------------------------------------------------------------------------------------------------------------------------
</TABLE>
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 57)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
MID CAP GROWTH FUND
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
COMMON STOCKS -- 94.6%
CAPITAL GOODS -- 3.0%
Amphenol* 55,600 $ 3,166
Flextronics International* 78,600 6,455
Sanmina* 76,900 7,200
Vishay Intertechnology* 82,800 2,546
------------
19,367
------------
COMMUNICATION SERVICES -- 1.8%
Allegiance Telecommunications* 47,250 1,760
Nextlink Communications, Cl A* 89,200 3,139
Powerwave Technologies* 128,100 4,864
Time Warner Telecommunications, Cl A* 40,000 1,932
------------
11,695
------------
CONSUMER CYCLICALS -- 10.8%
Bed Bath & Beyond* 146,000 3,561
Best Buy* 38,100 2,424
Centex 106,400 3,418
Cintas 70,100 3,054
Crown Castle International* 53,000 1,646
DeVry* 101,300 3,811
Dollar Tree Stores* 97,550 3,957
Getty Images* 34,300 1,044
Harley-Davidson 151,800 7,267
Hilton Hotels 303,700 3,512
International Game Technology 67,900 2,283
Marriott International, Cl A 52,600 1,917
Michaels Stores* 107,500 4,300
Park Place Entertainment* 128,500 1,944
Radio Shack 99,000 6,398
Staples* 135,300 1,920
Starwood Hotels and Resorts World Wide 92,600 2,894
TJX 154,100 3,467
TMP Worldwide* 44,700 3,598
Toys 'R' Us* 171,500 2,787
Venator Group* 279,800 3,463
------------
68,665
------------
CONSUMER STAPLES -- 0.3%
Starbucks* 40,100 1,607
------------
ENERGY -- 14.1%
Cooper Cameron* 110,900 8,172
Grant Prideco* 129,500 2,841
Nabors Industries* 207,400 10,868
National-Oilwell* 209,900 6,559
Ocean Energy* 180,000 2,779
Pride International* 246,700 6,538
R&B Falcon* 358,200 9,985
Rowan* 202,700 5,878
Santa Fe International 171,400 7,724
Smith International* 50,000 4,078
Talisman Energy* 173,200 6,073
Tidewater 117,000 5,323
Transocean Sedco Forex 134,600 7,891
Weatherford International* 113,600 4,885
------------
89,594
------------
MID CAP GROWTH FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
FINANCIALS -- 10.0%
Ace Limited 111,500 $ 4,376
Capital One Financial 130,000 9,108
Chubb 38,900 3,078
Comerica 55,400 3,237
Dime Bancorp 226,300 4,880
Golden State Bancorp* 162,600 3,841
Lehman Brothers Holdings 29,100 4,300
Progressive 25,900 2,121
Providian Financial 99,800 12,675
Sovereign Bancorp 237,300 2,195
TCF Financial 246,700 9,282
Waddell & Reed Financial, Cl A 152,700 4,734
------------
63,827
------------
HEALTH CARE -- 16.8%
Allergan 45,500 3,842
Alza, Cl A* 70,100 6,064
Biogen* 93,900 5,728
Celgene* 121,000 7,199
Cephalon* 122,800 5,956
Cytyc* 130,600 5,632
Forest Laboratories* 14,300 1,640
Health Management Associates, Cl A* 353,200 7,351
Human Genome Sciences* 18,500 3,203
IDEC Pharmaceuticals* 18,500 3,244
Immunex* 75,900 3,302
Inhale Therapeutic Systems* 31,600 1,781
Medarex* 57,600 6,757
MedImmune* 34,900 2,696
Millennium Pharmaceuticals* 69,900 10,210
PE Corp-Celera Genomics Group* 40,100 3,995
Quest Diagnostic* 52,800 6,059
Techne* 44,700 5,006
Tenet Healthcare* 193,200 7,028
Teva Pharmaceutical Industries, ADR 38,300 2,803
Watson Pharmaceuticals* 118,100 7,662
------------
107,158
------------
TECHNOLOGY -- 34.4%
Aether Systems* 10,600 1,118
Applied Micro Circuits* 50,300 10,415
Ariba* 43,700 6,261
Arrow Electronics* 71,500 2,435
Art Technology* 40,700 3,856
Atmel* 214,000 3,250
AvantGo* 115,400 2,308
BEA Systems* 115,200 8,971
Bookham Technology, ADR* 16,800 720
Broadvision* 170,400 4,377
Brocade Communications Systems* 37,400 8,826
Calpine* 84,000 8,768
Celestica* 62,200 4,307
Ceridian* 154,700 4,341
Commerce One* 54,500 4,278
Comverse Technology* 20,400 2,203
Concord EFS* 176,200 6,258
Cosine Communications* 15,200 845
Cree Research* 23,600 2,744
Cypress Semiconductor* 42,900 1,783
The accompanying notes are an integral part of the financial statements.
(58 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
MID CAP GROWTH FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
Dallas Semiconductor 67,300 $ 2,212
E.piphany* 53,600 4,131
Fiserv* 53,400 3,197
Globespan* 35,100 4,282
Handspring* 12,900 891
Interwoven* 44,700 5,054
Intuit* 84,600 4,822
Kana Communications* 129,000 2,870
Kopin* 66,800 1,202
L-3 Communications* 33,600 1,898
Lattice Semiconductor* 49,600 2,666
Maxim Integrated Products* 44,100 3,547
Mercury Interactive* 73,000 11,443
New Focus* 32,400 2,562
Palm* 179,600 9,508
PE Corp-PE Biosystems Group 81,100 9,448
Portal Software* 73,700 2,948
QLogic* 45,400 3,995
Quest Software* 72,000 4,472
Rational Software* 108,000 7,493
Redback Networks* 40,500 6,642
Research In Motion* 66,700 6,574
Sandisk* 46,800 3,124
Semtech* 91,200 3,933
Storage Networks* 16,400 1,676
Sybase* 271,600 6,247
VerticalNet* 49,300 1,732
Vignette* 158,100 4,723
Virata* 52,100 3,445
Vitesse Semiconductor* 47,800 4,251
------------
219,052
------------
TRANSPORTATION -- 0.7%
C.H. Robinson Worldwide 75,900 4,278
------------
UTILITIES -- 2.7%
Constellation Energy 42,500 2,114
Dynegy 58,000 3,306
Kinder Morgan 197,700 8,093
Southern Energy* 120,100 3,768
------------
17,281
------------
TOTAL COMMON STOCKS
(Cost $476,773) 602,524
------------
RELATED PARTY MONEY MARKET FUND -- 6.6%
First American Prime Obligations Fund (A) 42,030,431 42,030
------------
TOTAL RELATED PARTY MONEY MARKET FUND
(Cost $42,030) 42,030
------------
TOTAL INVESTMENTS -- 101.2%
(Cost $518,803) 644,554
------------
OTHER ASSETS AND LIABILITIES, NET -- (1.2%) (B) (7,634)
------------
MID CAP GROWTH FUND (CONCLUDED)
DESCRIPTION VALUE (000)
--------------------------------------------------------------------
NET ASSETS:
Portfolio Capital--Class A ($0.0001 par value--
2 billion authorized) based on 14,016,600
outstanding shares $ 50,267
Portfolio Capital--Class B ($0.0001 par value--
2 billion authorized) based on 259,922
outstanding shares 4,323
Portfolio Capital--Class C ($0.0001 par value--
2 billion authorized) based on 320,972
outstanding shares 5,419
Portfolio Capital--Class Y ($0.0001 par value--
2 billion authorized) based on 18,893,657
outstanding shares 229,172
Accumulated net realized gain on investments 221,988
Net unrealized appreciation of investments 125,751
------------
TOTAL NET ASSETS -- 100.0% $ 636,920
------------
Net asset value and redemption price per
share -- Class A $ 18.88
Maximum sales charge of 5.25% (C) 1.05
------------
Offering price per share -- Class A $ 19.93
------------
Net asset value and offering price per
share -- Class B (D) $ 18.51
------------
Net asset value and redemption price per
share -- Class C (E) $ 18.61
Maximum sales charge of 1.00% (F) 0.19
------------
Offering price per share -- Class C $ 18.80
------------
Net asset value, offering price, and redemption
price per share -- Class Y $ 19.14
------------
*Non-income producing security
(A) This money market fund is advised by U.S. Bank National Association who also
serves as advisor for this fund. See also the notes to the financial
statements.
(B) Other assets and liabilities representing greater than five percent of total
net assets include the following (000):
Collateral received for securities loaned, at value $ 210,369
Payable upon return of securities loaned $(210,369)
(C) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 5.25%.
(D) Class B has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(E) Class C has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(F) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 1.00%.
ADR--American Depositary Receipt
Cl--Class
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 59)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
MID CAP VALUE FUND
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
COMMON STOCKS -- 92.7%
BASIC MATERIALS -- 6.2%
Bemis 114,700 $ 3,685
Georgia Pacific 61,600 1,448
Lyondell Chemical 127,000 1,500
Phelps Dodge 69,000 2,881
Praxair 86,800 3,244
Rohm & Haas 99,900 2,903
Weyerhaeuser 75,000 3,028
------------
18,689
------------
CAPITAL GOODS -- 9.0%
B.F. Goodrich 104,800 4,107
Deere 60,100 1,998
Dover 45,700 2,145
General Dynamics 71,200 4,472
Ingersoll Rand 71,300 2,415
ITT Industries 103,700 3,364
Parker Hannifin 95,600 3,226
SPX 15,700 2,228
Textron 69,400 3,201
------------
27,156
------------
COMMUNICATION SERVICES -- 1.8%
Centurytel 95,000 2,589
United States Cellular* 41,900 2,933
------------
5,522
------------
CONSUMER CYCLICALS -- 9.5%
Delphi Automotive Systems 306,700 4,639
Federated Department Stores* 129,600 3,386
Goodyear Tire & Rubber 57,500 1,035
Limited 158,400 3,495
Masco 210,200 3,915
Mattel 244,600 2,736
McGraw-Hill 80,900 5,142
Nike, Cl B 111,800 4,479
------------
28,827
------------
CONSUMER STAPLES -- 7.2%
Adelphia Communications, Cl A* 97,000 2,674
Adolph Coors, Cl B 65,800 4,158
Albertson's 100,700 2,115
Cardinal Health 55,000 4,850
General Mills 74,600 2,648
Pepsi Bottling Group 68,700 2,065
Sysco 66,900 3,098
------------
21,608
------------
ENERGY -- 7.9%
Anadarko Petroleum 73,200 4,865
Burlington Resources 100,100 3,685
Halliburton 73,800 3,612
Nabors Industries* 87,700 4,595
Santa Fe International 79,700 3,591
Transocean Sedco Forex 59,300 3,476
------------
23,824
------------
MID CAP VALUE FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
FINANCIALS -- 21.5%
Ace Limited 151,000 $ 5,927
AMBAC 75,800 5,552
Associates First Capital 81,300 3,089
BB&T 76,600 2,308
Chubb 45,400 3,592
C.I.T., Cl A 134,600 2,356
Franklin Resources 89,200 3,963
Golden West Financial 88,700 4,757
John Hancock Financial Services* 122,000 3,279
Lehman Brothers Holdings 21,400 3,162
Lincoln National 55,000 2,647
Marshall & Ilsley 32,000 1,604
MGIC Investment 96,500 5,899
Progressive 20,800 1,703
SouthTrust 73,800 2,320
St. Paul Companies 57,600 2,840
TCF Financial 43,000 1,618
Torchmark 81,300 2,261
UnionBanCal 111,000 2,588
Zions Bancorp 71,000 3,631
------------
65,096
------------
HEALTH CARE -- 3.7%
Health Management Associates, Cl A* 208,900 4,348
United Healthcare 16,000 1,580
Wellpoint Health Networks* 56,300 5,405
------------
11,333
------------
REAL ESTATE INVESTMENT TRUSTS -- 1.2%
Equity Office Properties Trust 114,600 3,560
------------
TECHNOLOGY -- 9.0%
Avnet 61,600 1,748
BMC Software* 41,600 796
Chippac* 114,100 1,355
Citrix Systems* 95,800 1,922
Conexant Systems* 41,500 1,738
Cypress Semiconductor* 48,700 2,024
Fairchild Semiconductor, Cl A* 36,700 1,032
Harris 62,800 1,786
NCR* 52,500 1,985
Palm* 48,477 2,566
SunGard Data Systems* 165,700 7,094
Sybase* 142,000 3,266
------------
27,312
------------
TRANSPORTATION -- 2.9%
Delta Air Lines 58,900 2,614
Southwest Airlines 124,500 3,019
Union Pacific 83,300 3,238
------------
8,871
------------
The accompanying notes are an integral part of the financial statements.
(60 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
MID CAP VALUE FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
UTILITIES -- 12.8%
Constellation Energy 82,800 $ 4,119
El Paso Energy 90,900 5,602
FPL Group 52,600 3,458
Kinder Morgan 170,600 6,984
Pinnacle West Capital 113,500 5,774
Public Service Enterprise 93,400 4,174
Reliant Energy 146,100 6,794
Southern Energy* 58,200 1,826
------------
38,731
------------
TOTAL COMMON STOCKS
(Cost $243,197) 280,529
------------
RELATED PARTY MONEY MARKET FUND -- 5.4%
First American Prime Obligations Fund (A) 16,232,671 16,233
------------
TOTAL RELATED PARTY MONEY MARKET FUND
(Cost $16,233) 16,233
------------
TOTAL INVESTMENTS -- 98.1%
(Cost $259,430) 296,762
------------
OTHER ASSETS AND LIABILITIES, NET -- 1.9% (B) 5,859
------------
NET ASSETS:
Portfolio Capital--Class A ($0.0001 par value--
2 billion authorized) based on 927,820
outstanding shares $ 23,473
Portfolio Capital--Class B ($0.0001 par value--
2 billion authorized) based on 874,869
outstanding shares 26,078
Portfolio Capital--Class C ($0.0001 par value--
2 billion authorized) based on 98,292
outstanding shares 1,312
Portfolio Capital--Class Y ($0.0001 par value--
2 billion authorized) based on 18,740,422
outstanding shares 349,649
Undistributed net investment income 65
Accumulated net realized loss on investments (135,288)
Net unrealized appreciation of investments 37,332
------------
TOTAL NET ASSETS -- 100.0% $ 302,621
------------
Net asset value and redemption price per
share -- Class A $ 14.62
Maximum sales charge of 5.25% (C) 0.81
------------
Offering price per share -- Class A $ 15.43
------------
Net asset value and offering price per
share -- Class B (D) $ 14.28
------------
Net asset value and redemption price per
share -- Class C (E) $ 14.55
Maximum sales charge of 1.00% (F) 0.15
------------
Offering price per share -- Class C $ 14.70
------------
Net asset value, offering price, and redemption
price per share -- Class Y $ 14.68
------------
MID CAP VALUE FUND (CONCLUDED)
DESCRIPTION
--------------------------------------------------------------------------------
*Non-income producing security
(A) This money market fund is advised by U.S. Bank National Association who also
serves as advisor for this fund. See also the notes to the financial
statements.
(B) Other assets and liabilities representing greater than five percent of total
net assets include the following (000):
Collateral received for securities loaned, at value $ 68,172
Payable upon return of securities loaned $(68,172)
(C) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 5.25%.
(D) Class B has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(E) Class C has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(F) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 1.00%.
AMBAC--American Municipal Bond Assurance Company
Cl--Class
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 61)
<PAGE>
STATEMENTS OF OPERATIONS for the year ended September 30, 2000 in thousands
<TABLE>
<CAPTION>
MID CAP MID CAP
GROWTH FUND VALUE FUND
--------------------------------------------------------------------------------------------------
<S> <C> <C>
INVESTMENT INCOME:
Interest $ 1,827+ $ 1,246+
Dividends 652 3,753
--------------------------------------------------------------------------------------------------
TOTAL INVESTMENT INCOME 2,479 4,999
==================================================================================================
EXPENSES:
Investment advisory fees 3,912 2,068
Less: Waiver of investment advisory fees (132) (117)
Administrator fees 607 321
Transfer agent fees 368 241
Custodian fees 168 89
Directors' fees 9 5
Registration fees 21 11
Professional fees 14 7
Printing 37 20
Distribution fees - Class A 597 36
Distribution fees - Class B 22 138
Distribution fees - Class C 22 7
Other 25 16
--------------------------------------------------------------------------------------------------
TOTAL NET EXPENSES 5,670 2,842
==================================================================================================
Investment income (loss) - net (3,191) 2,157
--------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAINS (LOSSES)
ON INVESTMENTS - NET:
Net realized gain (loss) on investments 240,252 (37,771)
Net change in unrealized appreciation or depreciation of investments 49,305 72,261
--------------------------------------------------------------------------------------------------
NET GAIN ON INVESTMENTS 289,557 34,490
==================================================================================================
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $286,366 $ 36,647
==================================================================================================
</TABLE>
+Includes income from securities lending program. See the Notes to the Financial
Statements for additional information.
The accompanying notes are an integral part of the financial statements.
(62 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS in thousands
<TABLE>
<CAPTION>
MID CAP MID CAP
GROWTH FUND VALUE FUND
------------------------------------------------------------------------------------------------------------------------------
10/1/99 10/1/98 10/1/99 10/1/98
to to to to
9/30/00 9/30/99 9/30/00 9/30/99
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
OPERATIONS:
Investment income (loss) - net $ (3,191) $ (1,307) $ 2,157 $ 3,316
Net realized gain (loss) on investments 240,252 68,544 (37,771) (111,991)
Net realized loss on closing and expiration of options written and purchased -- -- -- (6,875)
Net change in unrealized appreciation or depreciation of investments 49,305 19,285 72,261 153,185
------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 286,366 86,522 36,647 37,635
------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Investment income - net:
Class A -- -- (87) (192)
Class B -- -- (18) (80)
Class C -- -- (1) --
Class Y -- -- (2,180) (3,277)
Net realized gain on investments:
Class A (33,787) (34,559) -- (6,521)
Class B (89) (5) -- (6,711)
Class C (101) -- -- --
Class Y (43,422) (14,259) -- (74,784)
-----------------------------------------------------------------------------------------------------------------------------
Total distributions (77,399) (48,823) (2,286) (91,565)
-----------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS(1):
Class A
Proceeds from sales 82,148 10,245 6,834 8,828
Reinvestment of distributions 33,367 33,572 84 6,578
Payments for redemptions (103,709) (86,670) (14,884) (20,742)
-----------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from Class A transactions 11,806 (42,853) (7,966) (5,336)
-----------------------------------------------------------------------------------------------------------------------------
Class B
Proceeds from sales 4,213 332 662 1,088
Reinvestment of distribution 89 5 19 6,626
Payments for redemptions (322) (13) (8,563) (15,956)
-----------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from Class B transactions 3,980 324 (7,882) (8,242)
-----------------------------------------------------------------------------------------------------------------------------
Class C
Proceeds from sales 5,018 472 1,162 180
Reinvestment of distributions 102 -- 1 --
Payments for redemptions (166) (7) (30) (1)
-----------------------------------------------------------------------------------------------------------------------------
Increase in net assets from Class C transactions 4,954 465 1,133 179
-----------------------------------------------------------------------------------------------------------------------------
Class Y
Proceeds from sales 147,646 218,099 72,157 165,084
Reinvestment of distributions 32,160 13,236 1,109 57,099
Payments for redemptions (150,018) (111,681) (134,167) (289,556)*
-----------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from Class Y transactions 29,788 119,654 (60,901) (67,373)
-----------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from capital share
transactions 50,528 77,590 (75,616) (80,772)
-----------------------------------------------------------------------------------------------------------------------------
Total increase (decrease) in net assets 259,495 115,289 (41,255) (134,702)
NET ASSETS AT BEGINNING OF PERIOD 377,425 262,136 343,876 478,578
=============================================================================================================================
NET ASSETS AT END OF PERIOD (2) $636,920 $377,425 $302,621 $343,876
=============================================================================================================================
</TABLE>
(1)See note 4 in the notes to
financial statements for
additional information.
(2)Includes undistributed net
investment income (000) of: $0
and $0 for Mid Cap Growth Fund
and $65 and $194 for Mid Cap
Value Fund at September 30,
2000, and September 30, 1999,
respectively.
*Includes redemptions as a result
of the redemption in kind on
October 8, 1998.
The accompanying notes are an integral part of the financial statements.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 63)
<PAGE>
FINANCIAL HIGHLIGHTS For a share outstanding, throughout the periods ended
September 30, unless otherwise indicated
<TABLE>
<CAPTION>
REALIZED AND
NET ASSET UNREALIZED DIVIDENDS
VALUE NET GAINS OR FROM NET DISTRIBUTIONS
BEGINNING INVESTMENT (LOSSES) ON INVESTMENT FROM
OF PERIOD INCOME (LOSS) INVESTMENTS INCOME CAPITAL GAINS
---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
MID CAP GROWTH FUND(1)
Class A
2000 $ 12.87 $ (0.12) $ 8.80 $ -- $ (2.67)
1999 11.80 (0.07) 3.40 -- (2.26)
1998 15.25 (0.09) (1.80) -- (1.56)
1997 13.86 (0.08) 2.72 -- (1.25)
1996 12.97 (0.05) 2.18 -- (1.24)
Class B - FAIF
2000 $ 12.75 $ (0.16) $ 8.59 $ -- $ (2.67)
1999 11.78 (0.10) 3.33 -- (2.26)
1998(2) 13.86 (0.01) (2.07) -- --
Class B - Piper
1998(3) $ 15.20 $ (0.09) $ 1.02 $ -- $ (1.56)
1997(4) 12.54 (0.10) 2.76 -- --
Class C
2000 $ 12.80 $ (0.14) $ 8.62 $ -- $ (2.67)
1999(5) 12.43 (0.06) 0.43 -- --
Class Y
2000 $ 12.99 $ (0.08) $ 8.90 $ -- $ (2.67)
1999 11.87 (0.03) 3.41 -- (2.26)
1998 15.29 (0.04) (1.82) -- (1.56)
1997(4) 12.54 (0.01) 2.76 -- --
---------------------------------------------------------------------------------------
MID CAP VALUE FUND
Class A
2000 $ 12.95 $ 0.08 $ 1.67 $ (0.08) $ --
1999 15.04 0.10 1.26 (0.10) (3.35)
1998 24.19 0.07 (6.41) (0.07) (2.74)
1997 20.41 0.11 6.98 (0.11) (3.20)
1996 17.89 0.20 3.94 (0.20) (1.42)
Class B
2000 $ 12.67 $ 0.02 $ 1.61 $ (0.02) $ --
1999 14.80 0.04 1.22 (0.04) (3.35)
1998 23.96 (0.01) (6.41) -- (2.74)
1997 20.31 0.02 6.85 (0.02) (3.20)
1996 17.83 0.09 3.91 (0.10) (1.42)
Class C
2000 $ 12.92 $ 0.02 $ 1.63 $ (0.02) $ --
1999(5) 13.69 0.06 (0.78) (0.05) --
Class Y
2000 $ 12.99 $ 0.11 $ 1.69 $ (0.11) $ --
1999 15.05 0.12 1.30 (0.13) (3.35)
1998 24.21 0.14 (6.43) (0.13) (2.74)
1997 20.43 0.16 6.98 (0.16) (3.20)
1996 17.89 0.25 3.95 (0.24) (1.42)
---------------------------------------------------------------------------------------
</TABLE>
+Returns are for the period indicated and have not been annualized.
(A)Excluding sales charges.
(1)The financial highlights for the Mid Cap Growth Fund as set forth herein
include the historical financial highlights of the Piper Emerging Growth Fund
Class A shares and Class Y shares. The assets of the Piper Emerging Growth
Fund were acquired by Mid Cap Growth Fund on August 7, 1998. In connection
with such acquisition, (i) Class A shares of the Piper Emerging Growth Fund
were exchanged for Class A shares of the Mid Cap Growth Fund, (ii) Class Y
shares of the Piper Emerging Growth Fund were exchanged for Class Y shares of
the Mid Cap Growth Fund. On August 7, 1998, the Fund's advisor changed from
Piper Capital Management, Inc. to U.S. Bank National Association.
(2)Class B shares for FAIF have been offered since August 7, 1998. All ratios
for the period have been annualized.
(3)Effective April 28, 1998 all shareholders were exchanged into Class A. Class
B share activity was discontinued. All ratios for the period have been
annualized.
(4)Class B and Class Y shares have been offered since February 18, 1997. All
ratios for the period have been annualized.
(5)Class C shares have been offered since February 1, 1999. All ratios for the
period have been annualized.
The accompanying notes are an integral part of the financial statements.
(64 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
<TABLE>
<CAPTION>
RATIO OF RATIO OF NET
RATIO OF NET EXPENSES TO INVESTMENT INCOME
NET ASSET RATIO OF INVESTMENT AVERAGE (LOSS) TO AVERAGE
VALUE NET ASSETS EXPENSES TO INCOME (LOSS) NET ASSETS NET ASSETS PORTFOLIO
END OF TOTAL END OF AVERAGE TO AVERAGE (EXCLUDING (EXCLUDING TURNOVER
PERIOD RETURN (A) PERIOD (000) NET ASSETS NET ASSETS WAIVERS) WAIVERS) RATE
------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 18.88 76.44% $264,570 1.15% (0.70)% 1.17% (0.72)% 217%
12.87 31.69 165,072 1.14 (0.48) 1.19 (0.53) 94
11.80 (13.05) 188,763 1.18 (0.60) 1.34 (0.76) 39
15.25 21.04 274,799 1.23 (0.55) 1.39 (0.71) 51
13.86 17.84 303,769 1.18 (0.41) 1.37 (0.60) 44
$ 18.51 75.14% $ 4,812 1.90% (1.45)% 1.92% (1.47)% 217%
12.75 30.66 360 1.89 (1.26) 1.98 (1.35) 94
11.78 (15.01)+ 17 1.87 (1.12) 1.87 (1.12) 39
$ 14.57 7.77%+ $ -- 1.85% (1.33)% 1.85% (1.33)% 29%
15.20 21.21+ 1,028 1.85 (1.16) 1.85 (1.16) 51
$ 18.61 75.10% $ 5,971 1.90% (1.45)% 1.92% (1.47)% 217%
12.80 3.06+ 466 1.89 1.27 1.98 1.18 94
$ 19.14 76.88% $361,567 0.90% (0.46)% 0.92% (0.48)% 217%
12.99 31.97 211,527 0.89 (0.25) 0.96 (0.32) 94
11.87 (12.79) 73,356 0.87 (0.27) 0.87 (0.27) 39
15.29 21.93+ 59,393 0.87 (0.16) 0.87 (0.16) 51
------------------------------------------------------------------------------------------------------------------------
$ 14.62 13.58% $ 13,568 1.15% 0.53% 1.19% 0.49% 141%
12.95 8.03 20,148 1.15 0.63 1.18 0.60 121
15.04 (28.83) 29,261 1.14 0.43 1.14 0.43 135
24.19 39.93 35,207 1.14 0.58 1.15 0.57 82
20.41 25.23 17,987 1.13 1.06 1.13 1.06 143
$ 14.28 12.85% $ 12,495 1.90% (0.22)% 1.94% (0.26)% 141%
12.67 7.38 19,072 1.90 (0.13) 1.93 (0.16) 121
14.80 (29.40) 31,276 1.89 (0.31) 1.89 (0.31) 135
23.96 38.81 36,649 1.90 (0.18) 1.90 (0.18) 82
20.31 24.35 12,847 1.88 0.25 1.88 0.25 143
$ 14.55 12.81% $ 1,430 1.90% (0.15)% 1.93% (0.18)% 141%
12.92 (5.25)+ 164 1.90 0.29 1.93 0.26 121
$ 14.68 13.94% $275,128 0.90% 0.79% 0.94% 0.75% 141%
12.99 8.47 304,492 0.90 0.89 0.93 0.86 121
15.05 (28.65) 418,041 0.89 0.69 0.89 0.69 135
24.21 40.25 509,308 0.89 0.82 0.90 0.81 82
20.43 25.61 247,828 0.88 1.35 0.88 1.35 143
------------------------------------------------------------------------------------------------------------------------
</TABLE>
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 65)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
SMALL CAP GROWTH FUND
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
COMMON STOCKS -- 94.9%
BASIC MATERIALS -- 2.7%
Albany Molecular Research* 112,400 $ 6,315
Lone Star Technologies* 113,600 5,243
OM Group 71,825 3,133
------------
14,691
------------
CAPITAL GOODS -- 3.2%
ACT Manufacturing* 67,700 3,571
Active Power* 20,400 1,265
APW* 65,400 3,188
Manufacturers Services* 51,400 610
Oshkosh Truck 93,800 3,635
Power-One* 23,700 1,434
Satcon Technology* 33,700 1,205
Stericycle* 104,400 2,558
------------
17,466
------------
CONSUMER CYCLICALS -- 13.7%
Abercrombie & Fitch* 132,900 2,533
Burlington Coat Factory* 87,500 1,252
Children's Place* 104,800 2,699
Consolidated Stores* 233,000 3,145
Coorstek* 54,200 2,073
Copart* 231,900 3,218
Cost Plus* 93,100 2,805
Digitas* 198,000 3,514
Factory 2-U Stores* 95,100 2,906
Fire Pond* 139,500 2,023
Forrester Research* 73,500 4,686
Genesco* 282,900 4,792
ITT Educational Services* 63,300 1,717
Michaels Stores* 90,400 3,616
Orient Express Hotels* 41,400 797
Rent-Way* 171,400 5,206
ScreamingMedia* 88,000 825
Sharper Image* 97,000 1,710
Steiner Leisure* 169,600 3,795
Teleflex 61,400 2,111
Too* 104,200 2,475
Tweeter Home Entertainment* 133,100 4,833
Ultimate Electronics* 139,600 5,741
United Rentals* 148,300 3,578
Universal Compression Holdings* 124,400 3,849
------------
75,899
------------
CONSUMER STAPLES -- 4.2%
AmeriSource Health* 81,200 3,816
Bindley Western 131,800 4,218
Buca* 250,100 2,657
P.F. Changs China Bistro* 90,600 3,131
Priority Healthcare, CL B* 79,400 6,054
Ruby Tuesday 290,400 3,267
------------
23,143
------------
ENERGY -- 16.0%
Cal Dive International* 65,000 3,717
Chiles Offshore* 290,200 6,276
Core Laboratories N.V.* 220,500 5,416
Cross Timbers Oil 192,150 3,687
Grey Wolf* 841,100 4,836
SMALL CAP GROWTH FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
H Power* 82,000 $ 2,742
Key Energy Services* 596,500 5,853
Louis Dreyfus Natural Gas* 96,400 3,820
Marine Drilling* 159,300 4,550
National-Oilwell* 179,500 5,609
Offshore Logistics* 180,600 3,228
Parker Drilling* 765,300 5,357
Patterson Energy* 251,700 8,652
Pioneer Natural Resources 224,500 3,185
Prize Energy* 167,500 3,162
Proton Energy Systems* 10,200 292
Unocal 111,900 3,965
UTI Energy* 184,400 8,229
Veritas DGC* 211,300 6,114
------------
88,690
------------
FINANCIALS -- 7.3%
Affiliated Managers Group* 129,800 7,390
Americredit* 47,500 1,369
Bank United 65,800 3,335
Blackrock* 76,100 2,435
Eaton Vance 87,100 4,442
Greater Bay Bancorp 70,900 4,923
Investors Financial Services 33,800 2,134
Metris 94,400 3,729
Raymond James Financial 153,200 5,046
Webster Financial 102,100 2,750
Westamerica Bancorporation 84,600 2,829
------------
40,382
------------
HEALTH CARE -- 20.9%
3 Dimensional Pharamceutical* 102,000 3,672
Alpharma 80,300 4,908
Applied Molecular Evolution* 110,300 4,426
Barr Laboratories* 121,800 8,077
Bruker Daltonics* 85,600 3,798
Caremark Rx* 712,600 8,017
Cell Therapeutics* 131,100 8,743
Cepheid* 240,400 1,968
Coherent* 20,500 1,394
Cooper 82,000 2,901
Cubist Pharmaceuticals* 72,600 3,780
Curagen* 136,400 7,268
Discovery Partners International* 146,700 2,980
Durect* 67,800 1,017
Eden Bioscience* 18,200 601
Endocare* 158,700 3,134
Genencor International* 101,900 3,019
Genomica* 8,900 173
Inhale Therapeutic Systems* 45,200 2,548
Innerdyne* 181,600 1,271
Laboratory Corporation of America Holdings 29,900 3,581
Large Scale Biology* 95,600 3,131
Luminex* 170,800 6,490
Molecular Devices* 65,400 6,426
Myriad Genetics* 27,300 2,358
Physiometrix* 259,300 5,737
PolyMedica* 80,100 3,434
Tanox* 111,500 3,777
Transgenomic* 176,700 4,009
Variagenics* 132,600 2,967
------------
115,605
------------
The accompanying notes are an integral part of the financial statements.
(66 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
SMALL CAP GROWTH FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
TECHNOLOGY -- 24.6%
Actel* 144,400 $ 5,189
Advent Software* 100,824 7,045
Aeroflex* 97,625 4,747
Broadbase Software* 190,400 2,582
Caliper Technologies* 46,200 2,677
Chippac* 256,400 3,045
Chordiant Software* 208,900 1,619
Cirrus Logic* 174,800 7,047
Concord Camera* 143,500 3,677
Docent* 61,000 1,117
Elantec Semiconductor* 44,400 4,423
Elastic Networks* 20,300 283
Exar* 29,200 3,533
Exfo Electro-Optical Engineering* 31,200 1,359
Hall Kinion & Associates-Information
Technology* 121,600 3,458
Innovative Solutions & Support* 141,600 2,425
Interwoven* 26,600 3,007
IntraNet Solutions* 44,200 2,210
Kent Electronics* 124,500 2,972
Matrixone* 80,200 3,208
Methode Electronics, Cl A 84,300 3,736
Microtune* 51,700 2,769
MRV Communications* 31,400 1,423
Netegrity* 25,350 1,775
Netiq* 67,208 4,415
Netro* 37,500 2,222
NetScout Systems* 67,000 1,591
NETsilicon* 77,700 1,627
Oak Technology* 153,100 4,191
Pinnacle Systems* 135,700 1,527
Purchasepro.com* 49,000 4,306
Radisys* 49,800 2,518
REMEC* 143,650 4,229
Resonate* 23,100 912
Secure Computing* 263,600 6,870
Signalsoft* 22,300 906
Silicon Image* 106,600 2,645
Talarian* 76,800 1,474
Transwitch* 65,474 4,174
TriZetto* 234,200 3,630
TTM Technologies* 47,800 1,123
Tvia* 203,700 3,654
Vastera* 140,100 3,082
Vyyo* 44,500 1,335
Watchguard Technologies* 69,400 4,164
------------
135,921
------------
TRANSPORTATION -- 2.3%
Atlas Air* 38,300 1,618
Omi* 513,300 4,299
Teekay Shipping 67,700 3,178
Trico Marine Services* 237,600 3,772
------------
12,867
------------
Total Common Stocks
(Cost $405,777) 524,664
------------
SMALL CAP GROWTH FUND (CONCLUDED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
RELATED PARTY MONEY MARKET FUND -- 3.3%
First American Prime Obligations Fund (A) 18,355,512 $ 18,356
------------
TOTAL RELATED PARTY MONEY MARKET FUND
(Cost $18,356) 18,356
------------
TOTAL INVESTMENTS -- 98.2%
(Cost $424,133) 543,020
------------
OTHER ASSETS AND LIABILITIES, NET -- 1.8% (B) 9,748
------------
NET ASSETS:
Portfolio Capital--Class A ($0.0001 par value--
2 billion authorized) based on 2,335,549
outstanding shares $ 28,454
Portfolio Capital--Class B ($0.0001 par value--
2 billion authorized) based on 364,296
outstanding shares 7,192
Portfolio Capital--Class C ($0.0001 par value--
2 billion authorized) based on 339,484
outstanding shares 7,796
Portfolio Capital--Class Y ($0.0001 par value--
2 billion authorized) based on 19,317,945
outstanding shares 297,111
Accumulated net realized gain on investments 93,328
Net unrealized appreciation of investments 118,887
------------
TOTAL NET ASSETS -- 100.0% $ 552,768
------------
Net asset value and redemption price per
share -- Class A $ 24.47
Maximum sales charge of 5.25% (C) 1.36
------------
Offering price per share -- Class A $ 25.83
------------
Net asset value and offering price per
share -- Class B (D) $ 23.17
------------
Net asset value and offering price per
share -- Class C (E) $ 24.17
Maximum sales charge of 1.00% (F) 0.24
------------
Offering price per share -- Class C $ 24.41
------------
Net asset value, offering price, and redemption
price per share -- Class Y $ 24.79
------------
* Non-Income producing security
(A) This money market fund is advised by U.S. Bank National Association who also
serves as advisor for this fund. See also the notes to the financial
statements.
(B) Other assets and liabilities representing greater than 5% of total net
assets include the following (000):
Collateral received for securities loaned, at value $ 80,938
Payable upon return of securities loaned $(80,938)
(C) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 5.25%.
(D) Class B has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(E) Class C has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(F) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 1.00%.
Cl--Class
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 67)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
SMALL CAP VALUE FUND
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
COMMON STOCKS -- 94.4%
BASIC MATERIALS -- 1.5%
Cadiz* 163,400 $ 1,634
Matthews International, Cl A 127,600 3,748
Northwest Pipe* 164,100 1,846
-------------
7,228
-------------
CAPITAL GOODS -- 13.6%
Actuant Corporation 100,300 395
Alliant Techsystems* 261,100 21,443
APW Limited* 117,000 5,704
Astec Industries* 272,600 2,982
Benchmark Electronics* 32,900 1,711
L.B. Foster, Cl A* 254,000 873
MagneTek* 483,587 5,138
Moog, Cl A* 143,300 4,317
Newpark Resources* 378,000 3,496
Pentair 278,400 7,447
Rayovac* 194,600 3,333
SPX 39,600 5,621
Tredegar Industries 58,400 1,011
Washington Group International* 173,700 1,987
------------
65,458
------------
CONSUMER CYCLICALS -- 14.0%
Acxiom* 58,140 1,846
Ashworth* 201,500 1,587
Braun Consulting* 58,600 1,161
D.R. Horton 244,292 4,199
Dollar Thrifty Automotive* 185,300 3,660
Dura Automotive Systems* 421,600 3,893
Edelbrock* 40,500 448
ITT Educational Services* 108,400 2,940
NCO Group* 280,800 3,334
Park Ohio Holdings* 211,617 1,666
Plato Learning* 106,400 2,193
Regis 874,250 13,114
School Specialty* 176,700 3,766
Simpson Manufacturing* 47,050 2,103
Sport-Haley* 280,000 1,190
Stanley Furniture* 280,900 6,812
Steiner Leisure* 224,900 5,032
Tower Automotive* 370,300 3,472
Venator Group* 417,200 5,163
------------
67,579
------------
CONSUMER STAPLES -- 6.3%
Applebees International 86,900 1,999
Buca* 220,200 2,340
Buffets* 272,400 3,745
Michael Foods 356,700 8,338
Performance Food Group* 70,500 2,653
Suiza Foods* 144,300 7,314
Topps* 285,000 2,618
Valassis Communications* 65,400 1,455
------------
30,462
------------
SMALL CAP VALUE FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
ENERGY -- 11.1%
Atwood Oceanic* 40,000 $ 1,667
Basin Exploration* 415,000 8,092
Callon Petroleum* 35,000 553
Chieftan International* 216,300 4,475
Core Laboratories N.V.* 207,300 5,092
Evergreen Resources* 151,900 5,279
Forest Oil* 448,400 7,258
Global Industries* 184,200 2,302
Houston Exploration* 76,100 1,922
Marine Drilling* 81,000 2,314
Newfield Exploration* 164,000 7,657
Veritas DGC* 242,100 7,006
------------
53,617
------------
FINANCIALS -- 25.4%
Astoria Financial 134,900 5,211
Chelsea GCA Realty, REIT 108,800 3,822
Community First Bankshares 405,000 7,113
Cullen/Frost Bankers 134,100 4,358
Dain Rauscher 41,900 3,897
Dime Bancorp 264,900 5,712
E.W. Blanch Holdings 74,400 1,544
Enhance Financial Services Group 269,700 3,506
Farm Family Holdings* 90,500 2,862
First Republic Bank* 191,500 5,769
Highwoods Properties, REIT 97,800 2,311
Horace Mann Educators 216,000 3,537
Lexington Corporate Properties, REIT 169,386 1,906
Metris 81,950 3,237
National Commerce Bancorporation 344,400 6,866
Pacific Gulf Properties, REIT 77,500 2,073
Penn Treaty American* 121,400 2,208
Philadelphia Consolidated Holding* 244,700 5,108
Protective Life 252,100 7,531
Radian Group 296,800 20,034
Roslyn Bancorp 252,400 5,647
Sterling Bancshares 89,200 1,360
TCF Financial 342,800 12,898
Webster Financial 152,904 4,119
------------
122,629
------------
HEALTH CARE -- 10.0%
America Service Group* 153,700 3,996
ATS Medical* 110,000 1,657
BOLDER Technologies* 231,200 990
Catalytica* 715,933 8,860
Cooper 233,200 8,249
Kensey Nash* 137,300 1,785
Lifecore Biomedical* 163,600 1,268
Mentor 168,900 2,660
Osteotech* 161,600 1,545
PolyMedica* 223,300 9,574
Renal Care* 257,200 4,790
Res-Care* 288,500 1,316
Respironics* 84,600 1,412
------------
48,102
------------
The accompanying notes are an integral part of the financial statements.
(68 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
SMALL CAP VALUE FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
TECHNOLOGY -- 11.3%
Actel* 188,000 $ 6,756
Bell & Howell* 184,500 4,036
Catalyst International* 31,900 148
DMC Stratex Networks* 79,200 1,272
Evolving Systems* 265,600 1,726
FSI International* 202,200 2,881
Gatefield* 74,672 359
Innovex 305,300 4,160
Interlogix* 32,098 426
JDA Software* 90,700 1,156
Lodgenet Entertainment* 170,000 4,909
Micron Electronics* 97,000 873
NOVA* 113,674 1,947
Pioneer-Standard Electronics 157,700 2,139
Pomeroy Computer Resources* 139,300 2,638
Project Software & Development* 165,700 2,576
Radisys* 159,000 8,039
Rainbow Technologies* 102,200 3,615
REMEC* 84,450 2,486
S3* 108,700 1,121
Zamba* 266,300 1,132
------------
54,395
------------
TRANSPORTATION -- 0.2%
United Shipping and Technology* 310,600 1,262
------------
UTILITIES -- 1.0%
Unisource Energy Holding 300,000 4,912
------------
TOTAL COMMON STOCKS
(Cost $339,058) 455,644
------------
RELATED PARTY MONEY MARKET FUND -- 7.1%
First American Prime Obligations Fund (A) 34,170,381 34,170
------------
TOTAL RELATED PARTY MONEY MARKET FUND
(Cost $34,170) 34,170
------------
TOTAL INVESTMENTS -- 101.5%
(Cost $373,228) 489,814
------------
OTHER ASSETS AND LIABILITIES, NET -- (1.5%) (B) (7,305)
------------
SMALL CAP VALUE FUND (CONCLUDED)
DESCRIPTION VALUE (000)
--------------------------------------------------------------------
NET ASSETS:
Portfolio Capital--Class A ($0.0001 par value--
2 billion authorized) based on 2,098,133
outstanding shares $ 29,329
Portfolio Capital--Class B ($0.0001 par value--
2 billion authorized) based on 814,129
outstanding shares 14,851
Portfolio Capital--Class C ($0.0001 par value--
2 billion authorized) based on 65,063
outstanding shares 991
Portfolio Capital--Class Y ($0.0001 par value--
2 billion authorized) based on 25,124,762
outstanding shares 252,694
Undistributed net investment income 285
Accumulated net realized gain on investments 67,773
Net unrealized appreciation of investments 116,586
------------
TOTAL NET ASSETS -- 100.0% $ 482,509
------------
Net asset value and redemption price per
share -- Class A $ 17.09
Maximum sales charge of 5.25% (C) 0.95
------------
Offering price per share -- Class A $ 18.04
------------
Net asset value and offering price per
share -- Class B (D) $ 16.76
------------
Net asset value and redemption price per
share -- Class C (E) $ 16.88
Maximum sales charge of 1.00% (F) 0.17
------------
Offering price per share -- Class C $ 17.05
------------
Net asset value, offering price, and redemption
price per share -- Class Y $ 17.19
------------
*Non-income producing security
(A) This money market fund is advised by U.S. Bank National Association who also
serves as advisor for this fund. See also the notes to the financial
statements.
(B) Other assets and liabilities representing greater than five percent of total
net assets include the following (000):
Collateral received for securities loaned, at value $ 80,179
Payable upon return of securities loaned $(80,179)
(C) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 5.25%.
(D) Class B has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(E) Class C has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(F) The offering price is calcluated by dividing the net asset value by 1 minus
the maximum sales charge of 1.00%.
Cl--Class
REIT--Real Estate Investment Trust
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 69)
<PAGE>
STATEMENTS OF OPERATIONS for the year ended September 30, 2000 in thousands
<TABLE>
<CAPTION>
SMALL CAP SMALL CAP
GROWTH FUND VALUE FUND
-------------------------------------------------------------------------------------------------
<S> <C> <C>
INVESTMENT INCOME:
Interest $ 2,463+ $ 1,331+
Dividends 345 2,747
-------------------------------------------------------------------------------------------------
TOTAL INVESTMENT INCOME 2,808 4,078
=================================================================================================
EXPENSES:
Investment advisory fees 3,334 2,857
Less: Waiver of investment advisory fees -- (89)
Administrator fees 519 443
Transfer agent fees 152 229
Custodian fees 143 122
Directors' fees 7 6
Registration fees 20 15
Professional fees 12 10
Printing 31 27
Distribution fees - Class A 129 61
Distribution fees - Class B 59 85
Distribution fees - Class C 23 5
Other 20 21
-------------------------------------------------------------------------------------------------
TOTAL NET EXPENSES 4,449 3,792
=================================================================================================
Investment income (loss) - net (1,641) 286
-------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAINS ON INVESTMENTS - NET:
Net realized gain on investments 100,117 68,049
Net change in unrealized appreciation or depreciation of investments 81,954 23,381
-------------------------------------------------------------------------------------------------
NET GAIN ON INVESTMENTS 182,071 91,430
=================================================================================================
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $180,430 $ 91,716
=================================================================================================
</TABLE>
+Includes income from securities lending program. See the Notes to the Financial
Statements for additional information.
The accompanying notes are an integral part of the financial statements.
(70 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS in thousands
<TABLE>
<CAPTION>
SMALL CAP SMALL CAP
GROWTH FUND VALUE FUND
-------------------------------------------------------------------------------------------------------------------------
10/1/99 10/1/98 10/1/99 10/1/98
to to to to
9/30/00 9/30/99 9/30/00 9/30/99
-------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
OPERATIONS:
Investment income (loss) - net $ (1,641) $ (455) $ 286 $ 265
Net realized gain on investments 100,117 32,724 68,049 5,700
Net change in unrealized appreciation or depreciation
of investments 81,954 37,636 23,381 33,198
-------------------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 180,430 69,905 91,716 39,163
-------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Investment income - net:
Class A -- -- -- (7)
Class B -- -- -- --
Class C -- -- -- --
Class Y -- -- -- (554)
Net realized gain on investments:
Class A (3,977) (46) (53) (1,046)
Class B (304) (2) (5) (58)
Class C (54) -- -- --
Class Y (31,018) (171) (1,495) (29,702)
-------------------------------------------------------------------------------------------------------------------------
Total distributions (35,353) (219) (1,553) (31,367)
-------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS(1):
Class A
Proceeds from sales 65,853 50,619 12,390 4,600
Shares issued in connection with acquisition of Micro Cap
Value Fund and Regional Equity Fund -- -- 21,098 --
Reinvestment of distributions 3,812 54 52 1,045
Payments for redemptions (60,250) (58,336) (15,074) (7,771)
-------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from Class A
transactions 9,415 (7,663) 18,466 (2,126)
-------------------------------------------------------------------------------------------------------------------------
Class B
Proceeds from sales 6,013 1,003 848 663
Shares issued in connection with acquisition of Regional
Equity Fund -- -- 13,248 --
Reinvestment of distributions 303 2 5 59
Payments for redemptions (1,048) (415) (3,656) (350)
-------------------------------------------------------------------------------------------------------------------------
Increase in net assets from Class B transactions 5,268 590 10,445 372
-------------------------------------------------------------------------------------------------------------------------
Class C
Proceeds from sales 7,592 283 991 113
Reinvestment of distributions 53 -- 1 --
Payments for redemptions (131) (1) (113) (1)
-------------------------------------------------------------------------------------------------------------------------
Increase in net assets from Class C transactions 7,514 282 879 112
-------------------------------------------------------------------------------------------------------------------------
Class Y
Proceeds from sales 199,248 119,832 89,113 127,190
Shares issued in connection with acquisition of Micro Cap
Value Fund and Regional Equity Fund -- -- 110,330 --
Reinvestment of distributions 13,358 50 1,298 27,244
Payments for redemptions (110,520) (42,599) (170,625) (209,352)
-------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from Class Y transactions 102,086 77,283 30,116 (54,918)
-------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from capital share
transactions 124,283 70,492 59,906 (56,560)
-------------------------------------------------------------------------------------------------------------------------
Total increase (decrease) in net assets 269,360 140,178 150,069 (48,764)
NET ASSETS AT BEGINNING OF PERIOD 283,408 143,230 332,440 381,204
=========================================================================================================================
NET ASSETS AT END OF PERIOD (2) $ 552,768 $283,408 $ 482,509 $ 332,440
=========================================================================================================================
</TABLE>
(1)See note 4 in the notes to
financial statements for
additional information.
(2)Includes undistributed net
investment income (loss), (000)
of $0 and $0 for Small Cap
Growth Fund and $285, and $(1)
for Small Cap Value Fund at
September 30, 2000, and
September 30, 1999,
respectively.
The accompanying notes are an integral part of the financial statements.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 71)
<PAGE>
FINANCIAL HIGHLIGHTS For a share outstanding throughout the periods ended
September 30, unless otherwise indicated
<TABLE>
<CAPTION>
REALIZED AND
NET ASSET UNREALIZED DIVIDENDS DISTRIBUTIONS
VALUE NET GAINS OR FROM NET DISTRIBUTIONS FROM
BEGINNING INVESTMENT (LOSSES) ON INVESTMENT FROM RETURN OF
OF PERIOD INCOME (LOSS) INVESTMENTS INCOME CAPITAL GAINS CAPITAL
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
SMALL CAP GROWTH FUND
Class A(1)
2000 $ 16.77 $ (0.12) $ 9.89 $ -- $ (2.07) $ --
1999 11.90 (0.06) 4.95 -- (0.02) --
1998 17.41 (0.09) (2.67) -- (2.64) (0.11)
1997 17.11 (0.16) 5.66 (0.04) (5.16) --
1996(2) 17.68 0.06 0.87 (0.07) (1.43) --
Class B - FAIF
2000 $ 16.07 $ (0.23) $ 9.40 $ -- $ (2.07) $ --
1999 11.50 (0.14) 4.73 -- (0.02) --
1998(3) 13.74 (0.02) (2.22) -- -- --
Class B - Piper
1998(4) $ 9.54 $ (0.09) $ 0.42 $ -- $ (0.15) $ (0.01)
1997(5) 7.24 (0.03) 2.33 -- -- --
Class C
2000 $ 16.68 $ (0.13) $ 9.69 $ -- $ (2.07) $ --
1999(6) 15.48 (0.08) 1.28 -- -- --
Class Y
2000 $ 16.92 $ (0.06) $ 10.00 $ -- $ (2.07) $ --
1999 11.98 (0.02) 4.98 -- (0.02) --
1998(3) 14.29 -- (2.31) -- -- --
----------------------------------------------------------------------------------------------------------------
SMALL CAP VALUE FUND(B)
Class A
2000 $ 13.94 $ (0.01) $ 3.23 $ -- $ (0.07) $ --
1999 13.58 0.01 1.47 (0.01) (1.11) --
1998(7) 18.20 0.04 (3.38) (0.01) (1.27) --
1997(8) 17.86 (0.03) 0.37 -- -- --
1997(9) 13.95 0.01 5.43 (0.01) (1.52) --
1996(9) 13.23 0.04 1.83 (0.04) (1.11) --
Class B
2000 $ 13.77 $ (0.09) $ 3.15 $ -- $ (0.07) $ --
1999 13.53 0.02 1.33 -- (1.11) --
1998(7) 18.23 0.01 (3.43) (0.01) (1.27) --
1997(10)(11) 18.22 -- 0.01 -- -- --
Class C
2000 $ 13.87 $ (0.06) $ 3.14 $ $ (0.07) $ --
1999(6) 13.48 0.01 0.38 -- -- --
Class Y
2000 $ 13.98 $ 0.02 $ 3.26 $ -- $ (0.07) $ --
1999 13.60 0.01 1.50 (0.02) (1.11) --
1998(7) 18.23 0.06 (3.38) (0.04) (1.27) --
1997(8) 17.87 (0.01) 0.37 -- -- --
1997(9) 13.96 0.04 5.43 (0.04) (1.52) --
1996(9) 13.26 0.06 1.81 (0.06) (1.11) --
----------------------------------------------------------------------------------------------------------------
</TABLE>
+Returns are for the period indicated and have not been annualized.
(A)Excluding sales charges.
(B)The financial highlights for Small Cap Value Fund as set forth herein
include the historical financial highlights of the Qualivest Small Companies
Fund Class A and Class Y shares. The assets of the Qualivest Small Companies
Fund were acquired by Small Cap Value Fund on November 21, 1997. In
connection with such acquisition, (i) Class A and Class C shares of the
Qualivest Small Companies Fund were exchanged for Class A shares of Small
Cap Value Fund; and (ii) Qualivest Class Y shares were exchanged for Class Y
shares of Small Cap Value Fund.
(1)Historical per-share amounts have been adjusted to reflect the conversion
ratios utilized for the reorganization of the FAIF Small Cap Growth Fund and
the Piper Small Company Growth Fund, that occurred on July 31, 1998. Piper
Small Company Growth Fund is the financial reporting survivor. Therefore,
the financial highlights for the Small Cap Growth Fund represent the
financial highlights information of the former Piper Small Company Growth
Fund. On July 31, 1998, the fund's advisor changed from Piper Capital
Management, Inc. to U.S. Bank National Association.
(2)On September 12, 1996, shareholders of the Fund approved a change in the
Fund's investment objective from high total investment return consistent
with prudent investment risk to long-term capital appreciation. In
connection with this change in investment objective, the Fund's investment
policies were revised.
(3)Class Y and Class B shares have been offered since July 31, 1998. There is
no historical information for these Classes of Piper Small Company Growth
Fund prior to the reorganization on July 31, 1998. All ratios for the period
have been annualized.
(4)Effective April 28, 1998, all shareholders were exchanged into Class A.
Class B share activity was discontinued. All ratios for the period have
been annualized.
(5)Class B Piper Shares have been offered since February 18, 1997. All ratios
for the period have been annualized.
(6)Class C shares have been offered since February 1, 1999. All ratios for the
period have been annualized.
(7)For the period December 1, 1997 to September 30, 1998. All ratios for the
period have been annualized. The First American board of directors approved
a change in the fund's fiscal year end from November 30 to September 30,
effective September 30, 1998.
(8)For the period August 1, 1997, to November 30, 1997. All ratios for the
period have been annualized. The First American board of directors approved
a change in the fund's fiscal year end from July 31 to November 30,
effective November 30, 1997.
(9)For the period ended July 31.
(10)Class B shares have been offered since November 24, 1997. All ratios for the
period have been annualized.
(11)For the period November 24, 1997 to November 30, 1997.
The accompanying notes are integral part of the financial statements.
(72 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
<TABLE>
<CAPTION>
RATIO OF RATIO OF NET
RATIO OF NET EXPENSES TO INVESTMENT INCOME
NET ASSET RATIO OF INVESTMENT AVERAGE (LOSS) TO AVERAGE
VALUE NET ASSETS EXPENSES TO INCOME (LOSS) NET ASSETS NET ASSETS PORTFOLIO
END OF TOTAL END OF AVERAGE TO AVERAGE (EXCLUDING (EXCLUDING TURNOVER
PERIOD RETURN (A) PERIOD (000) NET ASSETS NET ASSETS WAIVERS) WAIVERS) RATE
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 24.47 62.07% $ 57,148 1.14% (0.57)% 1.14% (0.57)% 230%
16.77 41.11 32,203 1.14 (0.39) 1.15 (0.40) 110
11.90 (18.66) 28,252 1.29 (0.61) 1.43 (0.75) 92
17.41 45.66 35.647 1.34 (0.75) 1.98 (1.39) 109
17.11 5.38 30,968 1.32 0.20 1.79 (0.27) 125
$ 23.17 60.95% $ 8,440 1.89% (1.30)% 1.89% (1.30)% 230%
16.07 39.92 2,217 1.90 (1.16) 1.91 (1.17) 110
11.50 (16.30)+ 1,104 1.90 (1.20) 1.90 (1.20) 92
$ 9.71 3.61%+ $ -- 2.03% (1.30)% 2.40% (1.67)% 56%
9.54 31.77+ 480 1.98 (1.49) 2.15 (1.66) 109
$ 24.17 61.06% $ 8,205 1.89% (1.28)% 1.89% (1.28)% 230%
16.68 7.75+ 309 1.90 (1.18) 1.91 (1.19) 110
$ 24.79 62.58% $478,975 0.89% (0.30)% 0.89% (0.30)% 230%
16.92 41.42 248,679 0.90 (0.16) 0.91 (0.17) 110
11.98 (16.17)+ 113,874 0.90 (0.20) 0.90 (0.20) 92
-----------------------------------------------------------------------------------------------------------------------
$ 17.09 23.19% $ 35,858 1.14% (0.13)% 1.16% (0.15)% 73%
13.94 11.12 11,567 1.14 (0.17) 1.14 (0.17) 44
13.58 (19.48)+ 13,551 1.13 0.15 1.13 0.15 21
18.20 1.90+ 19,194 1.37 (0.38) 1.37 (0.38) 3
17.86 41.71 22,429 1.31 0.01 1.31 0.01 29
13.95 14.93 10,247 1.33 0.14 1.33 0.14 34
$ 16.76 22.31% $ 13,646 1.88% (0.89)% 1.90% (0.91)% 73%
13.77 10.16 1,005 1.89 (0.93) 1.89 (0.93) 44
13.53 (19.91)+ 618 1.88 (0.53) 1.88 (0.53) 21
18.23 0.05+ 1 1.90 (1.53) 1.90 1.53 3
$ 16.88 22.29% $ 1,099 1.88% (0.84)% 1.91% (0.87)% 73%
13.87 2.89+ 116 1.89 (1.04) 1.89 (1.04) 44
$ 17.19 23.56% $431,906 0.89% 0.11% 0.91% 0.09% 73%
13.98 11.36 319,752 0.89 0.08 0.89 0.08 44
13.60 (19.31)+ 367,035 0.88 0.40 0.88 0.40 21
18.23 2.01+ 461,046 1.06 (0.06) 1.06 (0.06) 3
17.87 41.96 449,988 1.06 0.25 1.06 0.25 29
13.96 14.94 297,793 1.08 0.41 1.08 0.41 34
-----------------------------------------------------------------------------------------------------------------------
</TABLE>
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 73)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
EMERGING MARKETS FUND
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
FOREIGN COMMON STOCKS -- 81.3%
BRAZIL -- 8.8%
CIA Brasileira de Distribuicao Grupo 60,350,000 $ 2,263
CIA Siderurgica Nacional, Cl A 9,272,000 293
CIA Vale do Rio Doce 11,000 276
Tele Norte Leste Participacoes ADR 81,800 1,871
Telebras ADR 4,900 388
Unibanco GDR 6,500 215
------------
5,306
------------
CHINA -- 8.1%
China Mobile ADR* 52,200 1,693
China Southern Airlines, Cl H* 663,000 206
China Unicom ADR* 9,300 203
Cosco Pacific 648,000 490
PetroChina 9,421,000 1,921
Shanghai Industrial Holdings 177,000 343
------------
4,856
------------
HONG KONG -- 11.4%
Cheung Kong Holdings 45,000 544
CITIC Pacific 127,000 547
Hang Seng Bank 53,000 571
HSBC Holdings 128,000 1,790
Johnson Electric Holdings 878,000 1,886
Li & Fung 120,000 253
Swire Pacific, Cl A 204,000 1,272
------------
6,863
------------
HUNGARY -- 3.8%
EGIS 24,400 1,091
Richter Gedeon 22,800 1,206
------------
2,297
------------
ISRAEL -- 9.5%
Check Point Software Technologies* 19,000 2,993
Teva Pharmaceutical Industries ADR 37,400 2,737
------------
5,730
------------
KOREA -- 3.3%
Samsung Electronics GDR (A) 16,490 1,542
SK Telecom ADR 18,347 470
------------
2,012
------------
MEXICO -- 17.3%
Fomento Economico Mexicano ADR 20,100 784
Grupo Financiero Banamex Accival, Cl O* 515,000 2,361
Grupo Posadas, Cl A* 1,453,000 1,092
Grupo Televisa GDR* 30,900 1,783
Telefonos de Mexico ADR 27,100 1,441
Tubos de Acero de Mexico ADR* 55,400 928
Walmart de Mexico* 980,000 2,034
------------
10,423
------------
EMERGING MARKETS FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
POLAND -- 0.7%
Bank Rozwoju Eksportu 13,800 $ 417
------------
RUSSIA -- 5.4%
Lukoil-Holding ADR 22,900 1,282
Mobile Telesystems* 45,000 1,142
Rostelecom ADR 20,800 183
Surgutneftegaz ADR 46,300 677
------------
3,284
------------
SINGAPORE -- 4.6%
Datacraft Asia 180,000 1,494
Flextronics International* 8,000 657
United Overseas Bank 61,000 438
Venture Manufacturing 17,000 164
------------
2,753
------------
SOUTH AFRICA -- 4.9%
Anglo American 15,700 828
Dimension Data Holdings* 142,700 1,323
Standard Bank Investment 200,500 771
------------
2,922
------------
TAIWAN -- 3.5%
Advanced Semiconductor Engineering* 1,130 2
Taiwan Semiconductor Manufacturing* 240,939 800
Uni-President Enterprises 335,880 237
United Microelectronics* 69,860 149
Via Technologies* 82,500 872
Winbond Electronics* 800 1
Yageo* 39,300 31
------------
2,092
------------
TOTAL FOREIGN COMMON STOCKS
(Cost $42,835) 48,955
------------
FOREIGN PREFERRED STOCKS -- 12.6%
BRAZIL -- 12.6%
Banco Bradesco 39,020,000 323
Banco Itau 20,370,000 1,811
CIA de Bebidas das Americas 2,417,000 2,659
Petroleo Brasileiro 97,900 2,796
------------
7,589
------------
TOTAL FOREIGN PREFERRED STOCKS
(Cost $6,727) 7,589
------------
The accompanying notes are an integral part of the financial statements.
(74 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
EMERGING MARKETS FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
FOREIGN RIGHTS -- 0.0%
BRAZIL -- 0.0%
Telesp Celular Participacoes ADR*,
expire 10/02/00 196 $ --
------------
TOTAL FOREIGN RIGHTS
(Cost $0) --
------------
RELATED PARTY MONEY MARKET FUND -- 5.1%
First American Prime Obligations Fund (B) 3,043,665 3,044
------------
TOTAL RELATED PARTY MONEY MARKET FUND
(Cost $3,044) 3,044
------------
TOTAL INVESTMENTS -- 99.0%
(Cost $52,606) 59,588
------------
OTHER ASSETS AND LIABILITIES, NET -- 1.0% 614
------------
NET ASSETS:
Portfolio Capital--Class A ($.0001 par value--
2 billion authorized) based on 510,439
outstanding shares $ 11,479
Portfolio Capital--Class B ($.0001 par value--
2 billion authorized) based on 12,826
outstanding shares 120
Portfolio Capital--Class C ($.0001 par value--
2 billion authorized) based on 508
outstanding shares 5
Portfolio Capital--Class Y ($.0001 par value--
2 billion authorized) based on 6,517,081
outstanding shares 42,653
Accumulated net investment loss (297)
Accumulated net realized loss on investments (740)
Net unrealized appreciation of investments 6,982
------------
TOTAL NET ASSETS -- 100.0% $ 60,202
------------
Net asset value and redemption price per
share -- Class A $ 8.50
Maximum sales charge of 5.25% (C) 0.47
------------
Offering price per share -- Class A $ 8.97
------------
Net asset value and offering price per
share -- Class B (D) $ 8.37
------------
Net asset value and redemption price per
share -- Class C (E) $ 8.46
Maximum sales charge of 1.00% (F) 0.09
------------
Offering price per share -- Class C $ 8.55
------------
Net asset value, offering price, and redemption
price per share -- Class Y $ 8.55
------------
EMERGING MARKETS FUND (CONCLUDED)
DESCRIPTION
--------------------------------------------------------------------------------
*Non-income producing security
(A) Security sold within the terms of a private placement memorandum, exempt
from registration under section 144A of the Securities Act of 1933, as
amended, and may be sold only to dealers in that program or other "qualified
institutional investors." These securities have been determined to be liquid
under guidelines established by the Board of Directors.
(B) This money market fund is advised by U.S. Bank National Association who also
serves as advisor for this fund. See also the notes to the financial
statements.
(C) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 5.25%.
(D) Class B has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(E) Class C has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(F) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 1.00%.
ADR--American Depositary Receipt
Cl--Class
GDR--Global Depositary Receipt
At September 30, 2000, sector diversification of the Portfolio was as follows:
% of
Net Assets Value (000)
---------- -----------
FOREIGN COMMON STOCK
Telecommunications 14.8% $ 8,886
Electronics 10.1% 6,104
Pharmaceuticals 8.4% 5,034
Computer Software 7.2% 4,315
Banking 7.0% 4,200
Oil & Gas 6.4% 3,881
Diversified Operations 4.9% 2,946
Food, Beverage & Tobacco 4.2% 2,500
Financial Services 3.9% 2,361
Retail 3.4% 2,034
Multimedia 3.0% 1,783
Steel 2.0% 1,221
Mining 1.8% 1,105
Lodging 1.8% 1,092
Real Estate 0.9% 544
Commercial Services 0.8% 490
Distribution/Wholesale 0.4% 253
Transportation 0.3% 206
-------- -------
TOTAL FOREIGN COMMON STOCKS 81.3% 48,955
TOTAL FOREIGN PREFERRED STOCKS 12.6% 7,589
TOTAL FOREIGN RIGHTS -- --
TOTAL RELATED PARTY MONEY MARKET FUND 5.1% 3,044
-------- -------
TOTAL INVESTMENTS 99.0% 59,588
OTHER ASSETS AND LIABILITIES, NET 1.0% 614
-------- -------
NET ASSETS 100.0% $60,202
======== =======
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 75)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
INTERNATIONAL FUND
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
FOREIGN COMMON STOCKS -- 96.6%
AUSTRALIA -- 0.9%
Australia & New Zealand Banking Group 279,300 $ 2,009
Westpac Banking 708,500 4,892
------------
6,901
------------
CANADA -- 3.3%
Bank of Nova Scotia 72,600 2,111
Canadian Imperial Bank of Commerce 67,100 2,207
Nortel Networks 300,500 17,898
Toronto-Dominion Bank 137,700 4,045
------------
26,261
------------
DENMARK -- 1.3%
Novo-Nordisk, Cl B 48,800 10,823
------------
FINLAND -- 1.6%
Nokia 307,000 12,441
------------
FRANCE -- 19.2%
Alcatel 321,300 20,557
Aventis 423,300 31,753
Axa 241,108 31,491
BNP Paribas 48,300 4,258
Groupe Danone 69,100 9,489
Sanofi-Synthelabo 305,000 16,392
Societe Generale 128,100 7,162
STMicroelectronics 164,300 8,054
Total Fina Elf 169,600 24,816
------------
153,972
------------
GERMANY -- 10.7%
Allianz, Registered 44,200 14,491
Deutsche Bank, Registered 197,000 16,342
Dresdner Bank, Registered 76,900 3,349
Fresenius Medical Care 26,500 2,381
Muenchener Rueckversicher, Registered 60,300 17,933
Schering 295,300 19,180
Siemens 96,100 12,361
------------
86,037
------------
HONG KONG -- 0.5%
Citic Pacific 912,000 3,930
------------
IRELAND -- 2.8%
Allied Irish Banks 168,700 1,819
Bank of Ireland 364,600 2,912
Elan ADR* 324,100 17,744
------------
22,475
------------
ISRAEL -- 0.3%
Check Point Software Technologies* 14,400 2,268
------------
INTERNATIONAL FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
ITALY -- 4.6%
Alleanza Assicurazioni 802,200 $ 10,619
Assicurazioni Generali 155,500 5,002
San Paolo-IMI 1,319,700 21,453
------------
37,074
------------
JAPAN -- 7.5%
Canon 48,000 2,128
Chugai Pharmaceutical 234,000 4,251
Eisai 144,000 4,544
Fujikura 596,000 4,909
Furukawa Electric 271,000 7,486
Keyence 8,500 2,942
NEC 360,000 8,179
Nomura Securities 193,000 4,197
Sumitomo Electric Industries 528,000 9,113
Takeda Chemical Industries 147,800 9,766
Tokyo Electron 27,200 2,467
------------
59,982
------------
MEXICO -- 0.5%
Grupo Televisa GDR* 74,900 4,321
------------
NETHERLANDS -- 14.9%
ABN Amro Holding 960,900 22,387
Ahold 182,200 5,166
Heineken 247,700 13,771
ING Groep 487,300 32,460
Philips Electronics 257,629 11,088
Qiagen ADR* 57,900 2,729
Royal Dutch Petroleum 531,000 32,095
------------
119,696
------------
NORWAY -- 0.4%
Norsk Hydro 73,800 3,089
------------
SINGAPORE -- 0.9%
City Developments 692,000 3,380
United Overseas Bank 486,000 3,491
------------
6,871
------------
SPAIN -- 1.1%
Banco Bilbao Vizcaya Argentaria 590,400 8,920
------------
SWEDEN -- 2.3%
Ericsson Telephone ADR 533,200 7,898
Investor, Cl B 334,600 4,741
Securitas, Cl B 280,400 6,127
------------
18,766
------------
SWITZERLAND -- 11.0%
Credit Suisse Group, Registered 111,900 20,912
Julius Baer Holdings, Bearer 350 1,815
Nestle, Registered 7,466 15,551
Novartis, Registered 12,200 18,705
Serono, Bearer 14,780 18,043
UBS, Registered 101,600 13,520
------------
88,546
------------
The accompanying notes are an integral part of the financial statements.
(76 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
INTERNATIONAL FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
UNITED KINGDOM -- 12.8%
Amvescap 798,600 $ 17,286
Baltimore Technologies* 183,200 1,869
BP Amoco 228,700 2,036
Capita Group 670,800 5,951
Celltech Group* 135,300 2,699
CGNU 584,400 8,295
Glaxo Wellcome 339,800 10,289
HSBC Holdings 362,400 5,154
HSBC Holdings (HKD) 1,741,600 24,347
Logica 261,600 8,606
Nycomed Amersham 474,300 4,653
Reuters Group 458,400 8,689
Sema Group 134,500 2,307
------------
102,181
------------
TOTAL FOREIGN COMMON STOCKS
(Cost $736,828) 774,554
------------
FOREIGN PREFERRED STOCKS -- 0.6%
GERMANY -- 0.6%
SAP 19,400 4,759
------------
TOTAL FOREIGN PREFERRED STOCKS
(Cost $5,251) 4,759
------------
RELATED PARTY MONEY MARKET FUND -- 2.8%
First American Prime Obligations Fund (A) 22,529,135 22,529
------------
TOTAL RELATED PARTY MONEY MARKET FUND
(Cost $22,529) 22,529
------------
TOTAL INVESTMENTS -- 100.0%
(Cost $764,608) 801,842
------------
OTHER ASSETS AND LIABILITIES, NET -- 0.0% (B) (206)
------------
NET ASSETS:
Portfolio Capital--Class A ($.0001 par value--
2 billion authorized) based on 4,870,299
outstanding shares $ 69,836
Portfolio Capital--Class B ($.0001 par value--
2 billion authorized) based on 756,344
outstanding shares 13,264
Portfolio Capital--Class C ($.0001 par value--
2 billion authorized) based on 1,226,981
outstanding shares 24,719
Portfolio Capital--Class Y ($.0001 par value--
2 billion authorized) based on 36,361,490
outstanding shares 460,490
Accumulated net investment loss (12,455)
Accumulated net realized gain on investments 214,164
Net unrealized appreciation of investments 37,234
Net unrealized depreciation of forward foreign currency
contracts, foreign currency and translation of
other assets and liabilities in foreign currency (5,616)
------------
TOTAL NET ASSETS -- 100.0% $ 801,636
------------
INTERNATIONAL FUND (CONCLUDED)
DESCRIPTION VALUE (000)
--------------------------------------------------------------------
Net asset value and redemption price per
share -- Class A $ 18.52
Maximum sales charge of 5.25% (C) 1.03
------------
Offering price per share -- Class A $ 19.55
------------
Net asset value and offering price per
share -- Class B (D) $ 17.85
------------
Net asset value and redemption price per
share -- Class C (E) $ 18.30
Maximum sales charge of 1.00% (F) 0.18
------------
Offering price per share -- Class C $ 18.48
------------
Net asset value, offering price, and redemption
price per share -- Class Y $ 18.58
------------
*Non-income producing security
(A) This money market fund is advised by U.S. Bank National Association who also
serves as advisor for this fund. See also the notes to the financial
statements.
(B) Other assets and liabilities representing greater than five percent of the
total net assets include the following amounts (000):
Cash collateral received for securities on loan $ 42,465
Payable upon receipt of seucrities on loan $(42,465)
(C) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 5.25%.
(D) Class B has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(E) Class C has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(F) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 1.00%.
ADR--American Depositary Receipt
Cl--Class
GDR--Global Depositary Receipt
HKD--Hong Kong Dollar
At September 30, 2000, sector diversification of the Portfolio was as follows:
% of
Net Assets Value (000)
---------- -----------
FOREIGN COMMON STOCK
Banking 21.6% $173,107
Pharmaceuticals 20.5% 164,189
Insurance 15.0% 120,291
Oil & Gas 7.4% 58,946
Telecommunication Equipment 7.3% 58,795
Electronics 7.0% 56,365
Food, Beverage & Tobacco 5.5% 43,977
Financial Services 3.3% 26,224
Manufacturing 1.9% 15,450
Computer Services 1.9% 15,050
Multimedia 1.6% 13,009
Commercial Services 1.5% 12,078
Medical Supplies 0.9% 7,034
Diversified Operations 0.5% 3,930
Real Estate 0.4% 3,380
Biomedical 0.3% 2,729
-------- --------
TOTAL FOREIGN COMMON STOCKS 96.6% 774,554
TOTAL FOREIGN PREFERRED STOCKS 0.6% 4,759
TOTAL RELATED PARTY MONEY MARKET FUND 2.8% 22,529
-------- --------
TOTAL INVESTMENTS 100.0% 801,842
OTHER ASSETS AND LIABILITIES, NET -- (206)
-------- --------
NET ASSETS 100.0% $801,636
======== ========
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 77)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
INTERNATIONAL INDEX FUND
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
FOREIGN COMMON STOCKS -- 95.2%
AUSTRALIA -- 2.0%
AMP 19,902 $ 177
Boral 13,214 14
Brambles Industries 4,950 129
Broken Hill Proprietary 21,404 222
Coca-Cola Amatil 21,218 43
Coles Myer 20,939 81
CSR 11,898 26
Foster's Brewing Group 27,802 65
Lend Lease 7,021 79
MIM Holdings 54,945 32
National Australia Bank 16,030 221
News Corporation 24,653 347
Orica 7,707 24
Origin Energy 13,214 14
Pacific Dunlop 34,457 29
Rio Tinto 3,570 48
Santos 14,125 48
Southcorp 16,425 46
Telstra 87,286 286
Westfield Trust 32,821 56
Westpac Banking 20,262 140
WMC 16,793 69
------------
2,196
------------
AUSTRIA -- 0.2%
Bank Austria 1,386 75
Generale Holding Vienna 269 43
Oest Elektrizatswirts, Cl A 367 34
OMV 340 25
Wienerberger Baustoffindustrie 394 8
------------
185
------------
BELGIUM -- 0.8%
Bekaert 870 36
Delhaize-Le Lion 1,220 57
Electrabel 522 110
Electrabel Strip* 300 --
Fortis, Cl B 8,388 258
Fortis, Cl B Strip* 180 --
Groupe Bruxelles Lambert 458 111
KBC Bancassurance Holding 3,420 143
KBC Bancassurance Holding Strip 70 --
Solvay 1,720 102
Union Miniere 428 15
------------
832
------------
DENMARK -- 0.8%
Carlsberg, Cl A 562 22
Carlsberg, Cl B 36 1
D/S 1912, Cl B 20 215
D/S Svendborg, Cl B 9 130
Danisco 1,429 52
Den Danske Bank 399 51
INTERNATIONAL INDEX FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
FLS Industries, Cl B 5 $ --
ISS* 840 52
Novo-Nordisk, Cl B 1,011 224
Radiometer, Cl B 417 10
Tele Danmark, Cl B 2,572 141
------------
898
------------
FINLAND -- 2.6%
Kesko 3,100 27
Kone, Cl B 700 43
Nokia 57,600 2,334
Outokumpu 3,500 27
Sampo Insurance, Cl A 1,350 66
Sanitec 141 1
Sonera 9,100 231
Stockmann, Cl A 1,200 16
UPM-Kymmene 3,540 91
Wartsila, Cl B 700 12
------------
2,848
------------
FRANCE -- 10.6%
Accor 2,854 106
Air Liquide 1,017 119
Alcatel 12,210 781
Aventis 9,184 689
Axa 4,111 537
BNP Paribas 5,139 453
Bouygues 3,990 201
Canal Plus 1,537 230
Cap Gemini 959 180
Carrefour Supermarche 8,082 597
Casino Guichard Perrachon 1,114 105
Chargeurs 200 12
Compagnie de Saint-Gobain 908 114
Dassault Systemes 1,504 122
Eridania Beghin-Say 300 26
France Telecom 11,608 1,244
Gecina 264 24
Groupe Danone 1,594 219
L'Oreal 7,770 603
Lafarge 1,217 84
Lagardere SCA 1,631 99
LVMH Moet-Hennessey Louis Vuitton 5,750 434
Michelin, Cl B 1,758 49
Pernod Ricard 1,302 65
Peugeot Citroen 568 101
Pinault-Printemps-Redoute 1,379 243
Sadexho Alliance 628 100
Sagem 486 104
Sanofi-Synthelabo 9,372 504
Schneider Electric 2,014 127
Sidel 800 46
Simco 556 37
Societe BIC 1,500 56
Societe Eurafrance 110 62
Societe Generale 5,028 281
The accompanying notes are an integral part of the financial statements.
(78 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
INTERNATIONAL INDEX FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
STMicroelectronics 10,725 $ 526
Suez Lyonnaise des Eaux 2,358 366
Suez Lyonnaise des Eaux Strip* 1,520 --
Thomson CSF 2,035 86
Total Fina Elf 8,969 1,312
Total Fina Elf Strip* 2,079 --
Union du Credit-Bail Immobilier 395 58
Usinor 2,568 23
Valeo 1,203 52
Vivendi 7,020 522
-----------
11,699
-----------
GERMANY -- 7.7%
Adidas-Salomon 900 49
AGIV 880 9
Allianz, Registered 2,800 918
BASF 7,400 262
Bayer 8,550 316
Bayer Hypo-und Vereinsbank 5,137 281
Beiersdorf 1,550 146
Bilfinger & Berger Bau 1,200 14
Brau und Brunnen* 150 4
Continental 3,100 54
DaimlerChrysler 11,669 520
Deutsche Bank 7,300 606
Deutsche Lufthansa, Registered 4,800 98
Deutsche Telekom 35,950 1,234
Deutz* 550 2
Dresdner Bank 6,500 283
E.ON 8,872 457
EM.TV & Merchandising 1,300 68
Heidelberger Zement 995 49
Heidelberger Zement (BE) 122 6
Hochtief 1,900 39
KarstadtQuelle 1,000 32
Linde 1,500 61
MAN 1,950 51
Merck KGAA 2,800 97
Metro 3,584 147
Muenchener Rueckversicher, Registered 2,100 625
Preussag 2,450 75
RWE 5,330 187
SAP 2,310 444
Schering 3,150 205
Siemens 7,020 903
ThyssenKrupp 6,500 87
Volkswagen 4,000 184
------------
8,513
------------
HONG KONG -- 2.3%
Bank of East Asia 26,086 59
Cathay Pacific Airways 54,000 99
Cheung Kong Holdings 26,000 314
Chinese Estates Holdings* 114,725 14
CLP Holdings 29,500 132
Hang Seng Bank 23,700 255
INTERNATIONAL INDEX FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
Hong Kong & China Gas 73,514 $ 92
Hong Kong & Shanghai Hotels 29,000 18
Hopewell Holdings 26,227 10
Hutchison Whampoa 49,500 657
Hysan Development 29,500 38
Miramar Hotel & Investment 19,000 12
Pacific Century CyberWorks* 162,402 183
Peregrine Investment Holdings* 13,000 --
Shangri-La Asia 60,000 65
Shun Tak Holdings 75,146 11
Sino Land 78,657 39
South China Morning Post 46,000 35
Sun Hung Kai Properties 29,000 273
Swire Pacific, Cl A 20,500 128
Television Broadcasts 10,000 60
Wharf Holdings 35,150 72
Wing Lung Bank 3,500 13
------------
2,579
------------
IRELAND -- 0.3%
Allied Irish Banks 12,432 134
Eircom 26,700 59
Greencore Group 5,342 13
Independent News & Media 11,430 42
Irish Life & Permanent 5,087 50
Kerry Group 4,102 53
Waterford Wedgwood 14 --
------------
351
------------
ITALY -- 4.2%
Arnoldo Mondadori Editore 4,198 50
Assicurazioni Generali 13,994 450
Banca Intesa 58,000 224
Benetton Group 33,400 60
Enel 83,577 324
ENI 95,725 507
Fiat 4,710 110
Fiat RNC 2,640 35
Italcementi 4,394 36
Italgas 14,000 61
Mediaset 14,984 223
Mediobanca 8,000 85
Montedison 51,740 101
Olivetti 60,300 166
Parmalat Finanziaria 40,900 60
Pirelli 31,000 90
Riunione Adriatica di Sicurta 10,380 136
San Paolo-IMI 17,247 280
Sirti 3,500 5
Telecom Italia 43,888 466
Telecom Italia Mobile 78,607 635
Telecom Italia Mobile RNC 19,394 92
Telecom Italia RNC 9,883 54
Unicredito Italiano 62,500 326
------------
4,576
------------
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 79)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
INTERNATIONAL INDEX FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
JAPAN -- 26.1%
77 Bank 8,000 $ 60
Acom 1,700 142
Advantest 1,300 204
Ajinomoto 8,000 90
Alps Electric 3,000 66
Amada 5,000 41
Aoyama Trading 1,100 10
Asahi Bank 35,000 144
Asahi Breweries 7,000 63
Asahi Chemical Industry 19,000 113
Asahi Glass 16,000 164
Ashikaga Bank 2,000 4
Bank of Tokyo-Mitsubishi 55,000 650
Bank of Yokohama 19,000 87
Bridgestone 10,000 120
Canon 11,000 488
Central Japan Railway 27 158
Chugai Pharmaceutical 5,000 91
Chuo Mitsui Trust & Banking 5,100 18
Citizen Watch 1,000 11
Credit Saison 3,900 85
Dai Nippon Printing 11,000 163
Daicel Chemical Industries 10,000 28
Daiei* 16,000 43
Daiichi Pharmaceutical 7,000 178
Daikin Industries 4,000 77
Dainippon Ink & Chemicals 5,000 19
Dainippon Screen Manufacturing 7,000 51
Daito Trust Construction 3,000 49
Daiwa House Industries 9,000 63
Daiwa Securities 16,000 188
Denki Kagaku Kogyo 13,000 47
Denso 11,000 256
East Japan Railway 47 261
Ebara 5,000 76
Eisai 5,000 158
Fanuc 3,100 343
Fuji Photo Film 6,000 201
Fujitsu 24,000 557
Furukawa Electric 8,000 221
Gunma Bank 13,000 71
Haseko* 15,000 4
Hitachi 39,000 453
Hokuriku Bank* 2,000 5
Honda Motor 12,000 442
House Foods 3,000 41
Hoya 2,000 157
Isetan 2,000 17
Ito-Yokado 5,000 261
Itochu* 20,000 93
Japan Air Lines 24,000 91
Japan Tobacco 25 196
Joyo Bank 16,000 60
Jusco 6,000 110
Kajima 25,000 65
Kaneka 6,000 63
Kansai Electric Power 8,400 137
INTERNATIONAL INDEX FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
Kao 7,000 $ 191
Kawasaki Kisen Kaisha 24,000 49
Kawasaki Steel 44,000 52
Kinden 7,000 42
Kinki Nippon Railway 22,000 102
Kirin Brewery 13,000 134
Komatsu 16,000 97
Konica 3,000 21
Kubota 26,000 91
Kurita Water Industries 3,000 55
Kyocera 2,400 366
Kyowa Hakko Kogyo 7,000 58
Makita 4,000 32
Marubeni* 24,000 60
Marui 5,000 78
Matsushita Electric Industrial 24,000 629
Meiji Milk Products 6,000 28
Meiji Seika 7,000 42
Mitsubishi 19,000 153
Mitsubishi Chemical 28,000 97
Mitsubishi Electric 26,000 215
Mitsubishi Estate 16,000 167
Mitsubishi Heavy Industries 43,000 170
Mitsubishi Materials 18,000 56
Mitsubishi Trust & Banking 18,000 148
Mitsui 19,000 119
Mitsui Fudosan Real Estate 11,000 138
Mitsui Marine & Fire Insurance 12,000 55
Mizuho Holdings* 76 626
Mori Seiki 2,000 25
Murata Manufacturing 3,000 414
Mycal 5,000 14
NEC 19,000 432
NGK Insulators 8,000 115
NGK Spark Plug 4,000 67
Nikon 5,000 101
Nintendo 1,600 292
Nippon Express 15,000 80
Nippon Mitsubishi Oil 22,925 133
Nippon Paper Industries 13,000 80
Nippon Sheet Glass 7,000 112
Nippon Shokubai 2,000 10
Nippon Steel 74,000 131
Nippon Telegraph & Telephone 149 1,462
Nippon Yusen Kabushiki Kaisha 21,000 107
Nissan Motors* 49,000 281
Nissin Food Products 3,000 74
Nitto Denko 2,000 75
Nomura Securities 23,000 500
NSK 7,000 50
NTN 2,000 7
Obayashi 17,000 63
Oji Paper 12,000 74
Olympus Optical 6,000 92
Omron 4,000 105
Oriental Land 1,400 115
Orix 1,200 143
Osaka Gas 41,000 108
The accompanying notes are an integral part of the financial statements.
(80 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
INTERNATIONAL INDEX FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
Penta-Ocean Construction 1,000 $ 1
Pioneer Electronics 3,000 122
Rohm 1,500 411
Sakura Bank 50,000 373
Sankyo 7,000 156
Sanyo Electric 25,000 220
Sapporo Breweries 12,000 39
Secom 3,000 241
Sega Enterprises* 2,000 19
Sekisui Chemical 13,000 43
Sekisui House 11,000 106
Sharp 14,000 217
Shimano 3,000 58
Shimizu 19,000 56
Shin-Etsu Chemical 5,000 211
Shiseido 8,000 99
Shizuoka Bank 11,000 94
Showa Denko 37,000 46
SMC 800 134
Softbank 3,900 365
Sony 17,500 1,775
Sumitomo 13,000 113
Sumitomo Bank 37,000 469
Sumitomo Chemical 22,000 110
Sumitomo Electric Industries 9,000 155
Sumitomo Forestry 3,000 22
Sumitomo Marine & Fire Insurance 15,000 89
Sumitomo Metal Industries* 65,000 38
Sumitomo Metal Mining 11,000 61
Taiheiyo Cement 25,000 39
Taisei 12,000 18
Taisho Pharmaceutical 5,000 155
Takara Shuzo 3,000 61
Takashimaya 7,000 49
Takeda Chemical Industries 11,000 727
Takefuji 1,700 187
Teijin 15,000 62
Toa 9,000 10
Tobu Railway 1,000 3
Toho 470 78
Tohoku Electric Power 2,600 36
Tokai Bank 28,000 142
Tokio Marine & Fire Insurance 18,000 180
Tokyo Broadcasting System 3,000 121
Tokyo Electric Power 14,700 346
Tokyo Electron 2,000 181
Tokyo Gas 30,000 80
Tokyu 17,000 88
Toppan Printing 11,000 106
Toray 21,000 82
Toshiba 37,000 298
Tosho 12,000 38
Tostem 3,000 42
Toto 10,000 81
Toyo Seikan Kaisha 3,000 53
Toyobo 31,000 55
Toyota Motor 44,000 1,739
Ube Industries 18,000 37
Yamanouchi Pharmaceutical 5,000 241
INTERNATIONAL INDEX FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
Yamato Transport 6,000 $ 133
Yamazaki Baking 5,000 42
Yokogawa Electric 7,000 64
------------
28,804
------------
MALAYSIA -- 0.0%
Silverstone 3,325 --
YTL 4,000 4
------------
4
------------
NETHERLANDS -- 5.2%
ABN Amro Holding 17,276 403
Aegon 15,112 570
Ahold 7,803 221
Akzo Nobel 3,668 155
ASM Lithography Holding* 5,013 166
Buhrmann 1,772 45
Elsevier 9,805 110
Getronics 5,433 55
Heineken 4,014 223
ING Groep 11,115 740
KLM Royal Dutch Airlines 1,209 23
KPN 11,492 250
Philips Electronics 15,787 679
Royal Dutch Petroleum 25,170 1,521
TNT Post Group 6,343 148
Unilever 6,638 322
Vopak 1,874 37
Wolters Kluwer 4,086 83
------------
5,751
------------
NEW ZEALAND -- 0.1%
Brierley Investments 66,325 9
Carter Holt Harvey 49,289 33
Fletcher Challenge Building 3,165 3
Fletcher Challenge Energy 4,794 17
Fletcher Challenge Forest 19,179 6
Lion Nathan 26 --
Telecom Corporation of New Zealand 20,802 52
------------
120
------------
NORWAY -- 0.5%
Bergesen, Cl A 2,400 50
CRH 5,134 82
Hafslund, Cl A 3,850 21
Hafslund, Cl B 1,600 5
Norsk Hydro 3,350 140
Norske Skogindustrier 700 22
Orkla, Cl A 5,000 97
Petroleum Geo-Services* 3,500 59
Storebrand 9,124 65
------------
541
------------
PORTUGAL -- 0.3%
Electricidade de Portugal 45,510 144
Portugal Telecom 20,550 211
------------
355
------------
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 81)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
INTERNATIONAL INDEX FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
SINGAPORE -- 0.8%
City Developments 17,000 $ 83
DBS Group Holdings 18,211 201
DBS Land 46,000 70
Fraser & Neave 3,000 10
Overseas-Chinese Banking 21,141 134
Singapore Airlines 16,000 152
Singapore Telecommunications 83,000 130
United Overseas Bank 17,280 124
------------
904
------------
SPAIN -- 2.7%
Acerinox 745 20
Altadis 6,758 98
Autopistas Concesionaria Espanola 5,150 40
Banco Bilbao Vizcaya Argentaria 35,972 543
Banco Santander Central Hispano 49,777 546
Corporacion Financiera Alba 1,074 27
Corporacion Mapfre 94 1
Endesa 12,206 229
Fomento de Construcciones Y Contratas 1,720 28
Gas Natural SDG 7,368 123
Iberdrola 11,843 151
Metrovacesa 1,124 18
Repsol YPF 15,444 284
Telefonica* 39,193 777
Union Electrica Fenosa 4,413 79
Vallehermoso 2,745 16
Zardoya-Otis 4,040 33
------------
3,013
------------
SWEDEN -- 2.7%
Atlas Copco, Cl A 3,220 55
Drott, Cl B 2,459 29
Electrolux, Cl B 6,655 84
Ericsson, Cl B 93,816 1,427
Hennes & Mauritz, Cl B 11,140 223
Nordic Baltic Holding* 14,584 103
Skandia Forsakrings 13,860 275
Skandinaviska Enskilda Banken, Cl A 12,859 156
Skanska, Cl B 2,459 84
SKF, Cl B 3,000 39
Svenska Cellulosa, Cl B 4,410 78
Svenska Handlesbanken, Cl A 11,253 181
Swedish Match 20,354 63
Trelleborg, Cl B 2,000 13
Volvo, Cl A 3,737 59
Volvo, Cl B 5,215 84
------------
2,953
------------
SWITZERLAND -- 5.7%
ABB 3,655 355
Adecco, Bearer 271 176
Alusuisse Group, Registered* 120 70
Credit Suisse Group, Registered 3,284 614
Givaudan, Registered* 105 27
Holderbank Financiere Glarus, Bearer 71 74
Lonza 120 57
INTERNATIONAL INDEX FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
Nestle, Registered 445 $ 927
Novartis, Registered 855 1,311
Roche Holding, Bearer 21 208
Roche Holding, Genusscheine 84 739
SAirGroup, Registered 250 36
Schindler Holding, Registered 25 39
SGS Holdings, Bearer 32 44
SGS Holdings, Registered 91 31
Swatch Group, Bearer 56 81
Swatch Group, Registered 273 81
Swiss Reinsurance, Registered 147 281
Swisscom, Registered 860 211
UBS, Registered 5,111 680
Valora Holding, Registered 140 30
Zurich Allied, Registered 380 176
------------
6,248
------------
UNITED KINGDOM -- 19.6%
3I Group 6,653 166
Abbey National 16,611 221
Allied Zurich 18,002 205
Amvescap 8,262 179
Anglian Water* 8,839 76
Arm Holdings* 12,870 143
AstraZeneca 17,854 936
AstraZeneca (SK) 3,133 164
BAE Systems 33,888 183
BAE Systems CALS 7,691 11
Balfour Beatty 10,071 16
Barclays 17,317 479
Bass 11,745 115
BBA Group 9,021 49
BG Group 41,357 263
Blue Circle Industries 11,151 68
BOC Group 6,429 85
Boots 11,374 86
BP Amoco 232,432 2,069
British Airways 13,920 59
British American Tobacco 31,245 202
British Sky Broadcasting* 20,872 321
British Telecommunications 75,841 797
Cadbury Schweppes 25,260 149
Carlton Communications 9,863 77
Centrica 50,121 161
CGNU 13,897 197
Coats Viyella 22,869 15
Corus Group 41,185 31
Diageo 37,363 334
Electrocomponents 9,618 103
EMI Group 10,857 87
GKN 9,305 93
Glaxo Wellcome 42,278 1,280
Granada Compass* 27,815 260
Great Universal Stores 14,216 90
Halifax Group 26,450 226
Hammerson 10,193 63
Hanson 11,299 63
Hays 24,327 142
The accompanying notes are an integral part of the financial statements.
(82 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
INTERNATIONAL INDEX FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
Hilton Group 23,828 $ 68
HSBC Holdings 97,094 1,381
IMI 10,949 34
Imperial Chemical Industries 11,818 67
Invensys 47,743 104
J Sainsbury 26,064 144
Jefferson Smurfit Group 18,215 32
Johnson Matthey 4,897 68
Kingfisher 17,067 112
Land Securities 7,453 85
Lasmo 21,742 42
Legal & General Group 61,066 148
Lloyds TSB Group 62,445 583
Logica 4,777 157
Marconi 31,649 433
Marks & Spencer 35,186 106
National Grid Group 16,779 144
National Power 14,180 99
Nycomed Amersham 10,428 102
Pearson 7,619 212
Peninsular & Oriental Steam Navigation 10,802 95
Pilkington 29,405 35
Provident Financial 5,269 65
Prudential 22,333 305
Rank Group 16,954 41
Reed International 15,791 125
Reuters Group 17,636 334
Rexam 12,784 43
Rio Tinto 12,456 181
RMC Group 4,153 36
Royal Bank of Scotland Group 30,592 646
Sage Group 16,339 122
Schroders 4,178 86
Scottish Power 22,765 177
Sema Group 6,532 112
Slough Estates 9,571 50
SmithKline Beecham 66,024 904
Smiths Industries 4,855 50
Tate & Lyle 10,382 36
Tesco 79,263 291
Thames Water 8,322 149
TI Group 10,548 54
Unilever 33,972 220
United Utilities 9,948 101
Vodafone Group 719,568 2,686
Williams 16,024 78
Wolseley 7,923 37
WPP Group 10,267 124
------------
21,568
------------
TOTAL FOREIGN COMMON STOCKS
(Cost $80,937) 104,938
------------
INTERNATIONAL INDEX FUND (CONTINUED)
DESCRIPTION SHARES/PAR (000) VALUE (000)
--------------------------------------------------------------------
FOREIGN PREFERRED STOCKS -- 0.8%
AUSTRALIA -- 0.3%
News Corporation 26,093 $ 312
------------
GERMANY -- 0.4%
RWE 250 7
SAP 1,680 412
Volkswagen 2,000 55
------------
474
------------
ITALY -- 0.1%
Fiat 3,190 48
------------
TOTAL FOREIGN PREFERRED STOCKS
(Cost $360) 834
------------
FOREIGN CONVERTIBLE BONDS -- 0.0%
SPAIN -- 0.0%
Banco Bilbao Viscaya Argentaria
0.000%, 07/30/02 EU 12 13
------------
UNITED KINGDOM -- 0.0%
BG Transco Holdings
7.000%, 12/16/24 GB 9 13
BG Transco Holdings (A)
7.273%, 12/14/09 GB 9 13
4.188%, 12/14/22 GB 9 13
------------
39
------------
TOTAL FOREIGN CONVERTIBLE BONDS
(Cost $12) 52
------------
FOREIGN WARRANTS -- 0.0%
FRANCE -- 0.0%
Vivendi*, expire 05/02/01 19 --
------------
HONG KONG -- 0.0%
Chinese Estates Holdings*, expire 11/24/00 10,429 --
------------
MALAYSIA -- 0.0%
United Engineers*, expire 11/18/02 5,600 3
------------
SINGAPORE -- 0.0%
Asia Food & Properties*, expire 07/12/02 2,900 --
------------
TOTAL FOREIGN WARRANTS
(Cost $0) 3
------------
U.S. TREASURY OBLIGATIONS -- 0.3%
U.S. Treasury Bill (B)(C)
6.226%, 12/14/00 $ 300 296
------------
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $296) 296
------------
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 83)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
INTERNATIONAL INDEX FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
RELATED PARTY MONEY MARKET FUND -- 3.2%
First American Prime Obligations Fund (D) 3,557,487 $ 3,557
------------
TOTAL RELATED PARTY MONEY MARKET FUND
(Cost $3,557) 3,557
------------
TOTAL INVESTMENTS -- 99.5%
(Cost $85,162) 109,680
------------
OTHER ASSETS AND LIABILITIES, NET -- 0.5% 565
------------
NET ASSETS:
Portfolio Capital--Class A ($.0001 par value--
2 billion authorized) based on 228,144
outstanding shares $ 2,368
Portfolio Capital--Class B ($.0001 par value--
2 billion authorized) based on 66,839
outstanding shares 828
Portfolio Capital-Class Y ($.0001 par value--
2 billion authorized) based on 8,049,000
outstanding shares 69,806
Distributions in excess of net investment income (979)
Accumulated net realized gain on investments 13,791
Net unrealized appreciation of investments and open
futures contracts 24,558
Net unrealized depreciation of forward foreign currency
contracts, foreign currency and translation of
other assets and liabilities in foreign currency (127)
------------
TOTAL NET ASSETS -- 100.0% $ 110,245
------------
Net asset value and redemption price per
share -- Class A $ 13.19
Maximum sales charge of 5.25% (E) 0.73
------------
Offering price per share -- Class A $ 13.92
------------
Net asset value and offering price per
share -- Class B (F) $ 13.11
------------
Net asset value, offering price, and redemption
price per share -- Class Y $ 13.21
------------
*Non-income producing security
(A) Variable Rate Security -- the rate reported on the Statement of Net Assets
is the rate in effect as of September 30, 2000.
(B) The rate reflected in the Statement of Net Assets represents the security's
discount rate at purchase.
(C) Security has been pledged as collateral for open futures positions.
(D) This money market fund is advised by U.S. Bank National Association who also
serves as advisor for this fund. See also the notes to the financial
statements.
(E) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 5.25%.
(F) Class B has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
BE--Brussels Exchange
CALS--Capital Amortizing Loan Stock
Cl--Class
EU--Euro
GB--Great British Pound
RNC--Risparmio Non-Convertible
SK--Swedish Krona
INTERNATIONAL INDEX FUND (CONCLUDED)
------------------------------------------------------------------------------
At September 30, 2000, sector diversification of the Portfolio was as follows:
% of
Net Assets Value (000)
---------- ------------
FOREIGN COMMON STOCK
Telecommunications 14.7% $16,165
Banking 12.7% 13,994
Pharmaceuticals 8.2% 9,023
Electronics 6.4% 6,969
Oil & Gas 6.3% 6,918
Insurance 5.7% 6,239
Food, Beverage & Tobacco 5.6% 6,180
Automotive 3.9% 4,336
Consumer Goods 2.8% 3,058
Multimedia 2.2% 2,439
Manufacturing 2.4% 2,682
Electric Services 2.1% 2,355
Financial Services 2.1% 2,334
Transportation 2.0% 2,224
Chemicals 1.9% 2,124
Retail 1.8% 1,957
Real Estate 1.6% 1,720
Commercial Services 1.5% 1,707
Construction 1.1% 1,228
Computer Services 1.1% 1,228
Building Materials 1.0% 1,135
Cosmetics & Toiletries 1.0% 1,066
Diversified Operations 0.9% 1,043
Machinery 0.8% 842
Water Treatment 0.7% 747
Mining 0.7% 711
Computer Software 0.6% 689
Distribution/Wholesale 0.5% 582
Internet 0.5% 548
Paper Products 0.4% 436
Recreation 0.4% 407
Metals 0.4% 391
Defense 0.3% 384
Textiles 0.3% 335
Medical Supplies 0.2% 269
Lodging 0.2% 200
Advertising 0.1% 124
Packaging 0.1% 123
Agriculture 0.0% 26
-------- --------
TOTAL FOREIGN COMMON STOCKS 95.2% 104,938
TOTAL FOREIGN PREFERRED STOCKS 0.8% 834
TOTAL FOREIGN CONVERTIBLE BONDS -- 52
TOTAL FOREIGN WARRANTS -- 3
TOTAL U.S. TREASURY OBLIGATIONS 0.3% 296
TOTAL RELATED PARTY MONEY MARKET FUND 3.2% 3,557
-------- --------
TOTAL INVESTMENTS 99.5% 109,680
OTHER ASSETS AND LIABILITIES, NET 0.5% 565
-------- --------
NET ASSETS 100.0% $110,245
======== ========
The accompanying notes are an integral part of the financial statements.
(84 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES SEPTEMBER 30, 2000 in thousands
<TABLE>
<CAPTION>
INTERNATIONAL
FUND
-------------------------------------------------------------------------------------------------------------------------
<S> <C>
ASSETS:
Investment securities, at value (cost $764,608) $801,842
Cash 9
Foreign currency 4,738
Unrealized gains on foreign exchange contracts 2,211
RECEIVABLES:
Investment securities sold 12,508
Portfolio shares sold 6,353
Foreign withholding tax reclaim receivable 1,013
Dividends and interest receivable 704
Collateral received for securities loaned, at value 42,465
-------------------------------------------------------------------------------------------------------------------------
TOTAL ASSETS 891,843
=========================================================================================================================
LIABILITIES:
Unrealized losses on foreign exchange contracts 7,764
PAYABLES:
Investment securities purchased 30,197
Capital shares redeemed 8,697
Accrued expenses 1,084
Payable upon return of securities loaned 42,465
-------------------------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES 90,207
=========================================================================================================================
TOTAL NET ASSETS $801,636
=========================================================================================================================
COMPOSITION OF NET ASSETS:
Portfolio Capital - Class A ($.0001 par value - 2 billion authorized) based on 4,870,299 outstanding shares 69,836
Portfolio Capital - Class B ($.0001 par value - 2 billion authorized) based on 756,344 outstanding shares 13,264
Portfolio Capital - Class C ($.0001 par value - 2 billion authorized) based on 1,226,981 outstanding shares 24,719
Portfolio Capital - Class Y ($.0001 par value - 2 billion authorized) based on 36,361,490 outstanding shares 460,490
Accumulated net investment loss (12,455)
Accumulated net realized gain on investments 214,164
Net realized appreciation of investments 37,234
Net unrealized depreciation of forward foreign currency contracts, foreign currency and translation
of other assets and liabilities in foreign currency (5,616)
-------------------------------------------------------------------------------------------------------------------------
NET ASSETS $801,636
=========================================================================================================================
NET ASSET VALUE AND REDEMPTION PRICE PER SHARE - CLASS A $ 18.52
=========================================================================================================================
Maximum sales charge of 5.25% (1) 1.03
------------------------------------------------------------------------------------------------------------------------
OFFERING PRICE PER SHARE - CLASS A $ 19.55
=========================================================================================================================
NET ASSET VALUE AND OFFEREING PRICE PER SHARE - CLASS B (2) $ 17.85
=========================================================================================================================
NET ASSET VALUE AND REDEMPTION PRICE PER SHARE - CLASS C (3) $ 18.30
=========================================================================================================================
Maximum sales charge of 1.00% (4) 0.18
-------------------------------------------------------------------------------------------------------------------------
OFFERING PRICE PER SHARE - CLASS C $ 18.48
=========================================================================================================================
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION PRICE PER SHARE - CLASS Y $ 18.58
=========================================================================================================================
</TABLE>
(1)The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 5.25%.
(2)Class B has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(3)Class C has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(4)The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 1.00%.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 85)
<PAGE>
STATEMENTS OF OPERATIONS for the year ended September 30, 2000 in thousands
<TABLE>
<CAPTION>
EMERGING INTERNATIONAL INTERNATIONAL
MARKETS FUND FUND INDEX FUND
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest $ 247 $ 2,183+ $ 174
Dividends 457 6,365 2,076
Less: Foreign taxes withheld (57) (272) (201)
-------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT INCOME 647 8,276 2,049
=======================================================================================================
EXPENSES:
Investment advisory fees 787 10,550 928
Less: Waiver of investment advisory fees (119) (1,322) (323)
Administrator fees 69 917 144
Transfer agent fees 100 236 62
Custodian fees 63 844 133
Directors' fees 1 14 2
Registration fees 4 44 6
Professional fees 1 20 4
Printing 4 56 9
Pricing fees 2 28 4
Distribution fees - Class A 13 208 8
Distribution fees - Class B 1 101 9
Distribution fees - Class C -- 76 --
Other 1 9 26
-------------------------------------------------------------------------------------------------------
TOTAL NET EXPENSES 927 11,781 1,012
=======================================================================================================
Investment income (loss) - net (280) (3,505) 1,037
-------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAINS (LOSSES)
ON INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS - NET:
Net realized gain on investments 11,580 231,680 14,691
Net realized loss on forward foreign currency contracts
and foreign currency transactions (291) (14,693) (634)
Net change in unrealized appreciation/depreciation of
investments and open futures contracts 145 (95,618) (8,435)
Net change in unrealized appreciation/depreciation of
forward foreign currency contracts, foreign currency
and translation of other assets and liabilities in
foreign currency (9) (2,918) (130)
-------------------------------------------------------------------------------------------------------
NET GAIN ON INVESTMENTS 11,425 118,451 5,492
=======================================================================================================
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $11,145 $ 114,946 $ 6,529
=======================================================================================================
</TABLE>
+Includes income from securities lending program. See the Notes to the Financial
Statements for additional information.
The accompanying notes are an integral part of the financial statements.
(86 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS in thousands
<TABLE>
<CAPTION>
EMERGING INTERNATIONAL INTERNATIONAL
MARKETS FUND FUND INDEX FUND
---------------------------------------------------------------------------------------------------------------------------
10/1/99 10/1/98 10/1/99 10/1/98 10/1/99 10/1/98
to to to to to to
9/30/00 9/30/99 9/30/00 9/30/99 9/30/00 9/30/99
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Investment income (loss) - net $ (280) $ (132) $ (3,505) $ (2,221) $ 1,037 $ 1,462
Net realized gain (loss) on investments 11,580 (2,960) 231,680 37,390 14,691 (344)
Net realized loss on forward foreign currency
contracts and foreign currency transactions (291) (144) (14,693) (5,078) (634) (26)
Net change in unrealized appreciation or
depreciation of investments and open
futures contracts 145 8,273 (95,618) 104,902 (8,435) 32,483
Net change in unrealized appreciation or
depreciation of forward foreign currency
contracts, foreign currency and translation of
other assets and liabilities in foreign currency (9) 8 (2,918) (2,768) (130) (25)
---------------------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from
operations 11,145 5,045 114,946 132,225 6,529 33,550
---------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
FROM:
Investment income - net:
Class A -- -- -- (209) (25) (37)
Class B -- -- -- -- (3) (3)
Class C -- -- -- -- -- --
Class Y -- -- -- (2,103) (1,317) (1,798)
Net realized gain on investments:
Class A -- -- (2,835) (2,619) -- (145)
Class B -- -- (270) (172) -- (11)
Class C -- -- (76) -- -- --
Class Y -- -- (31,136) (20,724) -- (8,207)
---------------------------------------------------------------------------------------------------------------------------
Total distributions -- -- (34,317) (25,827) (1,345) (10,201)
---------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS(1):
Class A:
Proceeds from sales 601 284 246,636 105,801 2,429 10,825
Reinvestment of distributions -- -- 2,734 2,677 23 170
Payments for redemptions (1,935) (2,125) (211,006) (111,891) (2,956) (9,974)
---------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from Class A
transactions (1,334) (1,841) 38,364 (3,413) (504) 1,021
---------------------------------------------------------------------------------------------------------------------------
Class B:
Proceeds from sales 112 12 11,147 1,166 453 560
Reinvestment of distributions -- -- 266 169 3 14
Payments for redemptions (5) -- (1,398) (669) (284) (53)
---------------------------------------------------------------------------------------------------------------------------
Increase in net assets from Class B transactions 107 12 10,015 666 172 521
---------------------------------------------------------------------------------------------------------------------------
Class C:
Proceeds from sales 5 -- 24,526 940 24 --
Reinvestment of distributions -- -- 69 -- -- --
Payments for redemptions -- -- (771) (30) (24) --
---------------------------------------------------------------------------------------------------------------------------
Increase in net assets from Class C transactions 5 -- 23,824 910 -- --
---------------------------------------------------------------------------------------------------------------------------
Class Y:
Proceeds from sales 15,887 32,241 261,217 162,038 4,160 6,825
Reinvestment of distributions -- -- 16,572 12,193 78 7,990
Payments for redemptions (10,427) (3,467) (186,567) (121,781) (34,878) (10,815)
---------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from Class Y
transactions 5,460 28,774 91,222 52,450 (30,640) 4,000
---------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from capital
share transactions 4,238 26,945 163,425 50,613 (30,972) 5,542
---------------------------------------------------------------------------------------------------------------------------
Total increase (decrease) in net assets 15,383 31,990 244,054 157,011 (25,788) 28,891
NET ASSETS AT BEGINNING OF PERIOD 44,819 12,829 557,582 400,571 136,033 107,142
===========================================================================================================================
NET ASSETS AT END OF PERIOD (2) $ 60,202 $ 44,819 $801,636 $557,582 $110,245 $136,033
===========================================================================================================================
</TABLE>
(1)See note 4 in the notes to the
financial statements for
additional information.
(2)Includes undistributed losses of
$(297) and $(330) for Emerging
Markets Fund, an undistributed
loss of $(12,455) and
distribution in excess of net
investment income of $(11,375)
for International Fund, and
distributions in excess of net
investment income of $(979) and
$(450) for International Index
Fund, as of September 30, 2000
and September 30, 1999,
respectively.
The accompanying notes are an integral part of the financial statements.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 87)
<PAGE>
FINANCIAL HIGHLIGHTS For a share outstanding, throughout the periods ended
September 30, unless otherwise indicated
<TABLE>
<CAPTION>
REALIZED AND
NET ASSET UNREALIZED DIVIDENDS DISTRIBUTIONS
VALUE NET GAINS OR FROM NET DISTRIBUTIONS FROM
BEGINNING INVESTMENT (LOSSES) ON INVESTMENT FROM RETURN OF
OF PERIOD INCOME (LOSS) INVESTMENTS INCOME CAPITAL GAINS CAPITAL
-----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
EMERGING MARKETS FUND
Class A(1)
2000(15) $ 6.77 $ (0.06) $ 1.79 $ -- $ -- $ --
1999(15) 5.61 (0.04) 1.20 -- -- --
1998 10.96 (0.15) (5.18) (0.02) -- --
1997 8.85 0.02 2.10 (0.01) -- --
1996(2) 8.84 0.01 -- -- -- --
1996(3) 7.20 0.01 1.63 -- -- --
1995(4) 9.14 -- (1.94) -- -- --
Class B - FAIF
2000(15) $ 6.72 $ (0.11) $ 1.76 $ -- $ -- $ --
1999(15) 5.60 (0.08) 1.20 -- -- --
1998(5) 7.27 -- (1.67) -- -- --
Class B - Piper
1998(6) $ 10.86 $ (0.08) $ (1.07) $ (0.02) $ -- $ --
1997(7) 10.13 -- 0.73 -- -- --
Class C
2000(15)(16) $ 9.96 $ (0.06) $ (1.44) $ -- $ -- $ --
Class Y
2000(15) $ 6.80 $ (0.04) $ 1.79 $ -- $ -- $ --
1999(15) 5.62 (0.02) 1.20 -- -- --
1998(5) 7.27 0.01 (1.66) -- -- --
-----------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL FUND
Class A
2000(15) $ 15.64 $ (0.12) $ 3.95 $ -- $ (0.95) $ --
1999(15) 12.55 (0.10) 3.97 (0.06)(C) (0.72) --
1998 13.18 0.06 0.02 (0.46)(C) (0.25) --
1997 10.28 0.01 3.04 (0.15)(C) -- --
1996 10.28 (0.02) 0.20 (0.18)(C) -- --
1995 10.21 -- 0.07 -- -- --
Class B
2000(15) $ 15.21 $ (0.26) $ 3.85 $ -- $ (0.95) $ --
1999(15) 12.27 (0.20) 3.86 -- (0.72) --
1998 12.97 (0.07) 0.03 (0.41)(C) (0.25) --
1997 10.14 (0.08) 3.01 (0.10)(C) -- --
1996 10.20 (0.07) 0.17 (0.16)(C) -- --
1995 10.21 (0.03) 0.02 -- -- --
Class C
2000(15) $ 15.57 $ (0.23) $ 3.91 $ -- $ (0.95) $ --
1999(8)(15) 14.32 (0.12) 1.37 -- -- --
Class Y
2000(15) $ 15.65 $ (0.08) $ 3.96 $ -- $ (0.95) $ --
1999(15) 12.55 (0.06) 3.95 (0.07)(C) (0.72) --
1998 13.23 0.07 0.01 (0.51)(C) (0.25) --
1997 10.31 0.03 3.06 (0.17)(C) -- --
1996 10.30 (0.01) 0.22 (0.20)(C) -- --
1995 10.22 0.01 0.07 -- -- --
-----------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL INDEX FUND(B)
Class A
2000(15) $ 12.92 $ 0.09 $ 0.29 $ (0.11) $ -- $ --
1999(15) 10.69 0.10 3.13 (0.15) (0.85) --
1998(9) 10.94 0.11 (0.20) (0.16) -- --
1997(10) 12.32 0.05 (1.41) (0.02) -- --
1997(11) 10.64 0.10 1.70 (0.09) (0.02) (0.01)
1996(11) 10.45 0.07 0.17 (0.05) -- --
1995(11)(12) 10.00 -- 0.45 -- -- --
Class B
2000(15) $ 12.89 $ (0.02) $ 0.29 $ (0.05) $ -- $ --
1999(15) 10.68 0.06 3.08 (0.08) (0.85) --
1998(9) 10.99 0.05 (0.21) (0.15) -- --
1997(13)(14) 11.08 -- (0.09) -- -- --
Class C
2000(15)(16)(17) $ 13.96 $ 0.10 $ 0.22 $ -- $ -- $ --
Class Y
2000(15) $ 12.96 $ 0.11 $ 0.29 $ (0.15) $ -- $ --
1999(15) 10.71 0.14 3.14 (0.18) (0.85) --
1998(9) 10.99 0.14 (0.20) (0.22) -- --
1997(10) 12.37 0.06 (1.41) (0.03) -- --
1997(11) 10.69 0.13 1.70 (0.12) (0.02) (0.01)
1996(11) 10.48 0.09 0.18 (0.06) -- --
1995(11)(12) 10.00 0.01 0.47 -- -- --
-----------------------------------------------------------------------------------------------------------------------------
</TABLE>
+Returns are for the period indicated and have not been annualized.
(A)Excluding sales charges.
(B)The financial highlights for International Index Fund as set forth herein
include the historical financial highlights of the Qualivest International
Opportunities Fund Class A and Class Y shares. The assets of the
International Opportunities Fund were acquired by International Index Fund
on November 21, 1997. In connection with such acquisition, (i) Class A and
Class C shares of the Qualivest International Opportunities Fund were
exchanged for Class A shares of International Index Fund; and (ii) Qualivest
Class Y shares were exchanged for Class Y shares of International Index
Fund.
(C)Includes distributions in excess of net investment income due to tax
treatment of foreign currency related transactions.
(1)The financial highlights for Emerging Markets Fund as set forth herein
include the historical financial highlights of the Piper Emerging Markets
Growth Fund Class A shares. The assets of the Piper Emerging Markets Growth
Fund were acquired by Emerging Markets Fund on August 7, 1998. In connection
with such acquisition, Class A shares of the Piper Emerging Markets Growth
Fund were exchanged for Class A shares of the Emerging Markets Fund. On
August 7, 1998, the fund's advisor changed from Piper Capital Management
Incorporated to U.S. Bank National Association.
(2)For the three month period July 1, 1996, to September 30, 1996. All ratios
for the period have been annualized.
(3)Emerging Markets Growth Fund commenced operations and acquired the net
assets of Hercules Latin American Value Fund on June 21, 1996, via a
tax-free reorganization. Emerging Markets Growth Fund had no assets or
liabilities prior to the acquisition. Consequently, the information
presented for Emerging Markets Growth Fund prior to June 21, 1996,
represents the financial history of Hercules Latin American Value Fund. As a
result of the reorganization, the fund's subadvisor changed from Bankers
Trust Company to Edinburgh Fund Managers plc. On July 18, 1995, shareholders
of Hercules Latin American Value Fund approved a change in the fund's
advisor from Hercules International Management LLC to Piper Capital
Management Incorporated.
(88 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
<TABLE>
<CAPTION>
RATIO OF RATIO OF
RATIO OF NET EXPENSES TO NET INCOME
NET ASSET RATIO OF INVESTMENT AVERAGE TO AVERAGE
VALUE NET ASSETS EXPENSES TO INCOME (LOSS) NET ASSETS NET ASSETS PORTFOLIO
END OF TOTAL END OF AVERAGE TO AVERAGE (EXCLUDING (EXCLUDING TURNOVER
PERIOD RETURN (A) PERIOD (000) NET ASSETS NET ASSETS WAIVERS) WAIVERS) RATE
---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 8.50 25.55%+ $ 4,338 1.70% (0.70)% 1.89% (0.89)% 149%
6.77 20.68 4,551 1.70 (0.54) 2.02 (0.86) 138
5.61 (48.91) 5,384 1.96 (1.09) 3.43 (2.56) 48
10.96 23.91 16,998 2.00 0.17 3.34 (1.17) 105
8.85 0.11+ 13,772 2.00 0.26 4.09 (1.83) --
8.84 22.78 13,936 2.00 0.26 3.54 (1.28) 140
7.20 (21.23) 22,624 2.00 0.15 3.47 (1.32) 161
$ 8.37 24.55% $ 107 2.45% (1.21)% 2.66% (1.42)% 149%
6.72 20.00 13 2.45 (1.19) 2.72 (1.46) 138
5.60 (22.97)+ 1 2.46 (0.43) 4.30 (2.27) 48
$ 9.69 (10.59)%+ $ -- 2.76% (2.24)% 4.12% (3.60)% 34%
10.86 7.21 310 2.64 0.03 3.39 (0.72) 105
$ 8.46 (15.06)% $ 4 2.45% (0.99)% 2.64% (1.18)% 149%
$ 8.55 25.74% $ 55,753 1.45% (0.42)% 1.64% (0.61)% 149%
6.80 21.00 40,255 1.45 (0.35) 1.73 (0.63) 138
5.62 (22.70)+ 7,444 1.46 0.83 3.30 (1.01) 48
---------------------------------------------------------------------------------------------------------------------
$ 18.52 24.63% $ 90,223 1.60% (0.57)% 1.76% (0.73)% 152%
15.64 32.16 48,154 1.60 (0.71) 1.76 (0.87) 150
12.55 1.11 40,204 1.69 0.13 1.81 0.01 102
13.18 30.03 8,003 1.92 (0.09) 1.92 (0.09) 96
10.28 1.84 1,964 1.97 (0.28) 1.97 (0.28) 100
10.28 0.69 876 1.93 (0.13) 2.06 (0.26) 57
$ 17.85 23.71% $ 13,500 2.35% (1.26)% 2.51% (1.42)% 152%
15.21 31.06 4,338 2.35 (1.46) 2.51 (1.62) 150
12.27 0.13 2,892 2.44 (0.64) 2.56 (0.76) 102
12.97 29.13 2,188 2.67 (0.94) 2.67 (0.94) 96
10.14 1.02 1,175 2.72 (0.96) 2.72 (0.96) 100
10.20 (0.10) 306 2.76 (0.95) 2.81 (1.00) 57
$ 18.30 23.74% $ 22,451 2.35% (1.15)% 2.51% (1.31)% 152%
15.57 8.73+ 1,009 2.35 (1.22) 2.53 (1.40) 150
$ 18.58 24.95% $675,604 1.35% (0.38)% 1.51% (0.54)% 152%
15.65 32.40 504,081 1.35 (0.44) 1.51 (0.60) 150
12.55 1.15 357,475 1.44 0.42 1.56 0.30 102
13.23 30.38 217,414 1.67 0.06 1.67 0.06 96
10.31 2.11 135,238 1.72 (0.06) 1.72 (0.06) 100
10.30 0.78 94,400 1.74 0.12 1.81 0.05 57
---------------------------------------------------------------------------------------------------------------------
$ 13.19 2.90% $ 3,008 1.00% 0.61% 1.25% 0.36% 11%
12.92 31.70 3,437 1.00 0.83 1.25 0.58 --
10.69 (1.05)+ 1,873 0.99 1.21 1.22 0.98 --
10.94 (11.03)+ 1,270 0.92 0.98 1.21 0.69 --
12.32 17.03 1,605 0.98 0.90 1.28 0.60 3
10.64 2.29 2,005 1.06 0.84 1.35 0.55 6
10.45 4.50+ 20 1.40 0.23 1.54 0.09 --
$ 13.11 2.05% $ 877 1.75% (0.15)% 1.99% (0.39)% 11%
12.89 30.66 700 1.75 0.41 2.01 0.15 --
10.68 (1.53)+ 118 1.74 0.72 1.97 0.49 --
10.99 (0.36)+ 1 1.29 0.00 1.29 0.00 --
$ 14.28 2.29% $ -- 1.75% 1.72% 1.98% 1.49% 11%
$ 13.21 3.01% $106,360 0.75% 0.79% 0.99% 0.55% 11%
12.96 32.00 131,896 0.75 1.16 1.00 0.91 --
10.71 (0.73)+ 105,151 0.74 1.42 0.97 1.19 --
10.99 (10.93)+ 155,976 0.66 1.23 0.95 0.94 --
12.37 17.24 210,538 0.73 1.15 1.03 0.85 3
10.69 2.56 142,478 0.81 1.18 1.10 0.89 6
10.48 4.80+ 60,073 1.18 1.32 1.39 1.11 --
---------------------------------------------------------------------------------------------------------------------
</TABLE>
(4)For the period ended June 30.
(5)Class Y and Class B shares have been offered since August 10, 1998. All
ratios for the period have been annualized.
(6)Effective April 28, 1998 all shareholders were exchanged into Class A. Class
B share activity was discontinued. All ratios for the period have been
annualized.
(7)Class B shares have been offered since February 18, 1997. All ratios for the
period have been annualized.
(8)For the period ended September 30. Class C shares have been offered since
February 1, 1999. All ratios for the period have been annualized.
(9)For the period December 1, 1997 to September 30, 1998. All ratios for the
period have been annualized. The First American board of directors approved
a change in the fund's fiscal year end from November 30 to September 30,
effective September 30, 1998.
(10)For the period August 1, 1997 to November 30, 1997. All ratios for the
period have been annualized. The First American board of directors approved
a change in the fund's fiscal year end from July 31 to November 30,
effective November 30, 1997.
(11)For the period ended July 31.
(12)Commenced operations on July 3, 1995. All ratios for the period have been
annualized.
(13)Class B shares have been offered since November 24, 1997. All ratios for the
period have been annualized.
(14)For the period November 24, 1997 to November 30, 1997.
(15)Per share data calculated using average shares outstanding method.
(16)Commenced operations February 1, 2000. All ratios for the period have been
annualized.
(17)Effective June 30, 2000 all shareholders were exchanged into Class B. Class
C share activity was discontinued. All ratios for the period have been
annualized.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 89)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
HEALTH SCIENCES FUND
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
COMMON STOCKS -- 95.6%
HEALTH CARE -- 95.6%
BIOTECHNOLOGY -- 12.5%
Amgen* 10,000 $ 698
Cephalon* 11,500 558
Durect* 4,100 62
Eden Bioscience* 1,100 36
Enzon* 1,500 99
Genencor International* 6,300 187
Genomica* 600 12
Human Genome Sciences* 800 138
Hyseq* 1,600 58
IDEC Pharmaceuticals* 1,300 228
Imclone Systems* 1,800 211
Luminex* 5,900 224
Medarex* 3,200 375
MedImmune* 2,400 185
Millennium Pharmaceuticals* 2,900 424
Myriad Genetics* 2,300 199
Osi Pharmaceuticals* 1,600 112
Progenics Pharmaceuticals* 3,300 91
Protein Design Laboratories* 600 72
Techne* 2,900 325
------------
4,294
------------
COMPUTER SOFTWARE AND SERVICES -- 1.3%
PE Corp-Celera Genomics Group* 2,900 289
TriZetto* 9,300 144
-----------
433
-----------
DIVERSIFIED HEALTH CARE -- 12.6%
Abbott Laboratories 10,200 485
Allergan 1,000 84
American Home Products 13,000 735
Bristol-Myers Squibb 26,900 1,537
Ivax* 7,200 331
Johnson & Johnson 12,351 1,160
-----------
4,332
-----------
DRUGS -- 34.0%
3 Dimensional Pharamceutical* 5,300 191
Alpharma 5,200 318
Alza, Cl A* 8,500 735
Barr Laboratories* 8,150 540
Celgene* 7,700 458
Cell Therapeutics* 7,600 507
Cubist Pharmaceuticals* 3,400 177
Eli Lilly 4,500 365
Genentech* 3,900 724
Inhale Therapeutic Systems* 5,800 327
King Pharmaceuticals* 8,300 277
Large Scale Biology* 5,000 164
Merck 13,000 968
Pfizer 70,800 3,182
Pharmacia 16,767 1,009
QLT Phototherapeutics* 2,000 142
Schering Plough 12,900 600
Tanox* 6,400 217
Teva Pharmaceutical Industries, ADR 2,200 161
Watson Pharmaceuticals* 9,900 642
-----------
11,704
-----------
HEALTH SCIENCES FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
FOOD AND HEALTH DISTRIBUTIONS -- 5.0%
AmeriSource Health* 8,100 $ 381
Andrx* 1,100 103
Bindley Western 10,600 339
Cardinal Health 5,900 520
Priority Healthcare, Cl B* 5,100 389
------------
1,732
------------
HOSPITAL MANAGEMENT -- 2.2%
Health Management Associates, Cl A* 17,900 373
Tenet Healthcare* 10,300 375
------------
748
------------
MANAGED CARE -- 1.2%
Express Scripts, Cl A* 5,600 405
------------
MEDICAL ELECTRONICS -- 6.6%
Bruker Daltonics* 8,400 373
Caliper Technologies* 4,200 243
Cepheid* 14,900 122
Cytyc* 9,300 401
Molecular Devices* 4,300 422
PE Corp-PE Biosystems Group 4,300 501
Transgenomic* 9,500 216
------------
2,278
------------
MEDICAL PRODUCTS AND SUPPLIES -- 11.7%
ATS Medical* 25,475 384
Baxter International 5,800 463
Biomet 13,800 483
Conmed* 8,500 116
Cooper 13,100 463
Endocare* 8,800 174
Guidant* 9,200 650
Innerdyne* 18,100 127
Kensey Nash* 10,000 130
Medtronic 5,100 264
Mentor 12,200 192
Osteotech* 9,500 91
Physiometrix* 14,400 319
Steris* 15,400 185
------------
4,041
------------
RETAIL DRUG STORES -- 1.3%
Caremark Rx* 40,100 451
------------
SPECIAL SERVICES -- 7.2%
Albany Molecular Research* 7,900 444
Applied Molecular Evolution* 7,600 305
Curagen* 8,400 448
Discovery Partners International* 12,700 258
Laboratory of America Holdings 2,700 323
Regeneration Technologies* 16,000 132
Quest Diagnostic* 2,700 310
Variagenics* 11,500 257
------------
2,477
------------
TOTAL HEALTH CARE 32,895
------------
The accompanying notes are an integral part of the financial statements.
(90 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
HEALTH SCIENCES FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
TOTAL COMMON STOCKS
(Cost $25,194) $ 32,895
------------
RELATED PARTY MONEY MARKET FUND -- 6.2%
First American Prime Obligations Fund (A) 2,122,197 2,122
------------
TOTAL RELATED PARTY MONEY MARKET FUND
(Cost $2,122) 2,122
------------
TOTAL INVESTMENTS -- 101.8%
(Cost $27,316) 35,017
------------
OTHER ASSETS AND LIABILITIES, NET -- (1.8% ) (B) (629)
------------
NET ASSETS:
Portfolio Capital--Class A ($0.0001 par value--
2 billion authorized) based on 498,109
outstanding shares $ 5,540
Portfolio Capital--Class B ($0.0001 par value--
2 billion authorized) based on 327,343
outstanding shares 3,218
Portfolio Capital--Class C ($0.0001 par value--
2 billion authorized) based on 327,070
outstanding shares 3,915
Portfolio Capital--Class Y ($0.0001 par value--
2 billion authorized) based on 1,428,522
outstanding shares 10,835
Accumulated net realized gain on investments 3,179
Net unrealized appreciation of investments 7,701
------------
NET ASSETS -- 100.0% $ 34,388
------------
Net asset value and redemption price per
share -- Class A $ 13.34
Maximum sales charge of 5.25% (C) 0.74
------------
Offering price per share -- Class A $ 14.08
------------
Net asset value and offering price per
share -- Class B (D) $ 12.89
------------
Net asset value and redemption price per
share -- Class C (E) $ 13.29
Maximum sales charge of 1.00% (F) 0.13
------------
Offering price per share -- Class C $ 13.42
------------
Net asset value, offering price, and redemption
price per share -- Class Y $ 13.42
------------
HEALTH SCIENCES FUND (CONCLUDED)
DESCRIPTION
--------------------------------------------------------------------------------
*Non-income producing security
(A) This money market fund is advised by U.S. Bank National Association who also
serves as advisor for this fund. See the notes to the financial statements.
(B) Other assets and liabilities representing greater than five percent of total
net assets include the following (000):
Collateral received for securities loaned, at value $ 7,476
Payable upon return of securities loaned $(7,476)
(C) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 5.25%.
(D) Class B has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(E) Class C has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(F) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 1.00%.
ADR--American Depositary Receipt
Cl--Class
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 91)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
REAL ESTATE SECURITIES FUND
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
COMMON STOCKS -- 95.9%
REAL ESTATE INVESTMENT TRUSTS -- 95.8%
DIVERSIFIED -- 9.8%
Catellus Development* 51,500 $ 901
Colonial Properties Trust 35,000 899
Cousins Properties 28,300 1,219
Crescent Real Estate Equities 54,000 1,205
Vornado Realty Trust 45,500 1,689
------------
5,913
------------
FINANCIAL SERVICES -- 3.7%
Anthracite Mortgage Capital 274,000 2,243
------------
HOTELS -- 4.9%
Fours Seasons Hotel 4,000 293
Hospitality Properties Trust 45,000 1,052
Lasalle Hotel Properties 40,000 605
Meristar Hospitality 51,000 1,033
------------
2,983
------------
OFFICE/INDUSTRIAL -- 41.3%
Alexandria Real Estate Equities 20,000 686
Amb Property 77,600 1,906
Arden Realty Group 28,500 764
Beacon Capital Partnership* (A) 33,750 384
Boston Properties 68,000 2,920
Brandywine Realty Trust 20,000 405
CarrAmerica Realty Trust 40,000 1,210
Centerpoint Properties 19,000 875
Duke Realty Investments 97,000 2,340
Equity Office Properties Trust 151,013 4,691
First Industrial Realty Trust 19,200 590
Liberty Property Trust 33,500 921
Mission West Properties 88,300 1,225
Parkway Properties 8,300 253
Prentiss Properties Trust 18,000 470
Prologis Trust 76,600 1,819
SL Green Realty 31,500 884
Spieker Properties 45,700 2,631
------------
24,974
------------
RESIDENTIAL -- 25.2%
Apartment Investment & Management 31,300 1,442
Archstone Community Trust 71,900 1,766
Avalonbay Communities 58,800 2,804
BRE Properties, Cl A 39,000 1,248
Charles E. Smith Residential Realty 16,000 726
Equity Residential Properties Trust 60,500 2,904
Essex Property Trust 40,600 2,248
Gables Residential Trust 20,400 555
Post Properties 17,500 762
Summit Properties 31,300 753
------------
15,208
------------
REAL ESTATE SECURITIES FUND (CONTINUED)
DESCRIPTION SHARES/PAR (000) VALUE (000)
--------------------------------------------------------------------
RETAIL -- 8.6%
First Washington Realty Trust 17,500 $ 444
Kimco Realty 33,800 1,428
Pan Pacific Retail Properties 31,500 630
Philips International Realty 38,200 659
Urban Shopping Centers 42,400 2,014
------------
5,175
------------
SPECIALTY REAL ESTATE -- 2.3%
Capital Automotive 22,500 293
Fortress Investment* (A) 35,000 451
Franchise Finance of America 30,000 675
------------
1,419
------------
TOTAL REAL ESTATE INVESTMENT TRUSTS 57,915
------------
COMMUNICATION SERVICES -- 0.0%
Velocityhsi* 7,800 20
------------
TOTAL COMMUNICATION SERVICES 20
------------
TECHNOLOGY -- 0.1%
Internap Network Services* 1,855 33
------------
TOTAL TECHNOLOGY 33
------------
TOTAL COMMON STOCKS
(Cost $49,870) 57,968
------------
PREFERRED STOCKS -- 0.3%
Cypress* 6,019 14
Wyndham International* (B) 1,602 157
------------
TOTAL PREFERRED STOCKS
(Cost $25) 171
------------
CONVERTIBLE BOND -- 1.5%
Avatar Holdings, 31.4465 shares
7.000%, 04/01/05 $ 1,000 869
------------
TOTAL CONVERTIBLE BOND
(Cost $1,034) 869
------------
RELATED PARTY MONEY MARKET FUND -- 1.9%
First American Prime Obligations Fund (C) 1,160,198 1,160
------------
TOTAL RELATED PARTY MONEY MARKET FUND
(Cost $1,160) 1,160
------------
TOTAL INVESTMENTS -- 99.6%
(Cost $52,089) 60,168
------------
OTHER ASSETS AND LIABILITIES, NET -- 0.4% (D) 252
------------
The accompanying notes are an integral part of the financial statements.
(92 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
REAL ESTATE SECURITIES FUND (CONCLUDED)
DESCRIPTION VALUE (000)
--------------------------------------------------------------------
NET ASSETS:
Portfolio Capital--Class A ($0.0001 par value--
2 billion authorized) based on 160,123
outstanding shares $ 2,142
Portfolio Capital--Class B ($0.0001 par value--
2 billion authorized) based on 148,657
outstanding shares 2,153
Portfolio Capital--Class C ($0.0001 par value--
2 billion authorized) based on 12,942
outstanding shares 161
Portfolio Capital--Class Y ($0.0001 par value--
2 billion authorized) based on 4,425,103
outstanding shares 56,934
Distributions in excess of net investment income (69)
Accumulated net realized loss on investments (8,980)
Net unrealized appreciation of investments 8,079
------------
NET ASSETS -- 100.0% $60,420
------------
Net asset value and redemption price per
share -- Class A $ 12.71
Maximum sales charge of 5.25% (E) 0.70
------------
Offering price per share -- Class A $ 13.41
------------
Net asset value and offering price per
share -- Class B (F) $ 12.61
------------
Net asset value and redemption price per
share -- Class C (G) $ 12.68
Maximum sales charge of 1.00% (H) 0.13
------------
Offering price per share -- Class C $ 12.81
------------
Net asset value, offering price, and redemption
price per share -- Class Y $ 12.73
------------
* Non-income producing security
(A) Security sold within the terms of a private placement memorandum, exempt
from registration under section 144A of the Securities Act of 1933, as
amended, and may be sold only to dealers in that program or other "qualified
institutional investors." These securities have been determined to be liquid
under guidelines established by the Board of Directors.
(B) Private Placement Securities considered illiquid investments under
guidelines established by the Board of Directors.
(C) This money market fund is advised by U.S. Bank National Association who also
serves as advisor for this fund. See also the notes to the financial
statements.
(D) Other assets and liabilities representing greater than five percent of total
net assets include the following (000):
Collateral received for securities loaned, at value $ 7,119
Payable upon return of securities loaned $(7,119)
(E) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 5.25%.
(F) Class B has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(G) Class C has a contingent deferred sales charge. For a description of a
possible redemption charge, see the notes to the financial statements.
(H) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 1.00%.
TECHNOLOGY FUND
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
COMMON STOCKS -- 95.6%
TECHNOLOGY -- 81.2%
COMMERCIAL AND CONSUMER SERVICES -- 0.2%
Crown Castle International* 35,600 $ 1,106
------------
COMPUTER HARDWARE -- 11.1%
Brocade Communications Systems* 89,900 21,216
Compaq Computer 513,200 14,154
Handspring* 108,600 7,500
Juniper Networks* 64,800 14,187
Palm* 350,227 18,540
Tricord Systems* 338,500 5,056
------------
80,653
------------
COMPUTER NETWORKING -- 4.8%
Cisco Systems* 627,700 34,680
------------
COMPUTER SOFTWARE AND SERVICES -- 37.3%
Aether Systems* 12,300 1,298
Amdocs* 113,300 7,067
America Online* 197,900 10,637
Art Technology* 78,400 7,428
Ask Jeeves* 102,600 1,969
Avantgo* 125,800 2,516
BEA Systems* 86,700 6,752
Broadbase Software* 285,500 3,872
Broadvision* 430,600 11,061
Click Commerce* 83,800 3,582
Commerce One* 206,100 16,179
Corio* 204,200 1,563
Docent* 81,800 1,498
DSET* 150,000 3,094
E.piphany* 115,400 8,893
Exodus Communications* 147,800 7,298
Infospace.com* 125,800 3,805
Internap Network Services* 150,500 4,863
Interwoven* 128,600 14,540
Kana Communications* 323,700 7,202
Microsoft* 140,800 8,492
Netscout Systems* 67,600 1,606
NetIQ* 160,771 10,561
Nuance Communications* 14,200 1,728
Numerical Technologies* 14,200 409
Oracle Systems* 318,400 25,074
Portal Software* 181,600 7,264
Purchasepro.com* 82,200 7,223
Resonate* 115,400 4,558
ScreamingMedia* 79,500 745
Selectica* 125,800 5,016
Serena Software* 74,300 3,422
Siebel Systems* 164,800 18,344
Signalsoft* 11,100 451
Talarian* 28,900 555
VeriSign* 78,800 15,962
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 93)
<PAGE>
STATEMENTS OF NET ASSETS SEPTEMBER 30, 2000
TECHNOLOGY FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
Veritas Software* 44,800 $ 6,362
Vignette* 258,410 7,720
Vitria Technology* 265,500 12,379
Watchguard Technologies* 107,100 6,426
------------
269,414
------------
COMPUTER SYSTEM SERVICES -- 0.5%
Netegrity* 38,300 2,681
Vastera* 27,200 598
------------
3,279
------------
ELECTRONICS DEFENSE -- 0.6%
Aeroflex* 87,375 4,249
------------
ELECTRONIC SEMICONDUCTORS -- 22.9%
Actel* 62,100 2,232
Bookham Technology, ADR* 19,700 845
Broadcom, Cl A* 38,500 9,384
Caliper Technologies* 36,600 2,121
Chartered Semiconductor Manufacturing, ADR* 108,600 6,591
Chippac* 528,000 6,270
Conexant Systems* 318,900 13,354
Cypress Semiconductor* 233,500 9,705
Globespan* 80,200 9,784
JDS Uniphase* 132,660 12,561
Marvel Technology* 110,600 8,530
Maxim Integrated Products* 120,000 9,653
Micron Technology* 109,900 5,055
Microtune* 125,000 6,695
New Focus* 29,400 2,324
Omnivision Technologies* 11,200 405
PMC-Sierra* 63,600 13,690
Taiwan Semiconductor, ADR* 493,700 10,059
Tvia* 251,800 4,517
Virage Logic* 13,900 229
Virata* 135,500 8,960
Vitesse Semiconductor* 158,800 14,123
Xilinx* 100,000 8,563
------------
165,650
------------
EQUIPMENT SEMICONDUCTORS -- 3.8%
Applied Materials* 158,480 9,400
ASM Lithography Holding H.V.* 235,500 7,610
Credence Systems* 77,800 2,334
Insilicon* 41,900 608
KLA Tencor* 109,200 4,498
Teradyne* 95,600 3,346
------------
27,796
------------
TOTAL TECHNOLOGY 586,827
------------
TECHNOLOGY FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
CAPITAL GOODS -- 2.0%
Smtc* 11,500 $ 247
Sony, ADR 140,100 14,141
------------
TOTAL CAPITAL GOODS 14,388
------------
COMMUNICATION EQUIPMENT -- 6.4%
ADC Telecommunications* 167,958 4,517
Comverse Technology* 40,000 4,320
Cosine Communications* 17,900 995
Efficient Networks* 151,600 5,657
Elastic Networks* 27,200 379
Floware Wireless Systems* 51,600 1,285
Natural MicroSystems* 30,500 1,641
Nortel Networks 250,800 14,938
Sonicwall* 138,600 3,950
Turnstone Systems* 137,800 6,391
Vyyo* 70,900 2,127
Wj Communications* 11,200 414
------------
TOTAL COMMUNICATION EQUIPMENT 46,614
------------
CONSUMER CYCLICALS -- 1.5%
Gemstar -TV Guide International* 87,618 7,639
Lifeminders* 132,500 3,039
------------
TOTAL CONSUMER CYCLICALS 10,678
------------
CONSUMER STAPLES -- 0.0%
Internet Pictures* 47,300 257
------------
TOTAL CONSUMER STAPLES 257
------------
ENERGY -- 0.0%
Proton Energy Systems* 13,600 389
------------
TOTAL ENERGY 389
------------
LONG DISTANCE TELEPHONE -- 4.5%
Allegiance Telecommunications* 241,300 8,988
Covad Communications Group* 236,000 3,157
Nextlink Communications, Cl A* 351,500 12,368
Time Warner Telecommunications, Cl A* 160,700 7,764
------------
TOTAL LONG DISTANCE TELEPHONE 32,277
------------
TOTAL COMMON STOCKS
(Cost $570,564) 691,430
------------
The accompanying notes are an integral part of the financial statements.
(94 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
TECHNOLOGY FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
--------------------------------------------------------------------
RELATED PARTY MONEY MARKET FUND -- 3.3%
First American Prime Obligations Fund (A) 23,589,375 $ 23,589
------------
TOTAL RELATED PARTY MONEY MARKET FUND
(Cost $23,589) 23,589
------------
TOTAL INVESTMENTS -- 98.9%
(Cost $594,153) 715,019
------------
OTHER ASSETS AND LIABILITIES, NET -- 1.1% (B) 8,060
------------
NET ASSETS:
Portfolio Capital--Class A ($0.0001 par value--
2 billion authorized) based on 3,262,178
outstanding shares $ 148,124
Portfolio Capital--Class B ($0.0001 par value--
2 billion authorized) based on 2,184,911
outstanding shares 84,680
Portfolio Capital--Class C ($0.0001 par value--
2 billion authorized) based on 707,551
outstanding shares 37,899
Portfolio Capital--Class Y ($0.0001 par value--
2 billion authorized) based on 8,991,186
outstanding shares 218,506
Accumulated net realized gain on investments 113,004
Net unrealized appreciation of investments 120,866
------------
NET ASSETS -- 100.0% $ 723,079
------------
Net asset value and redemption price per
share -- Class A $ 47.68
Maximum sales charge of 5.25% (C) 2.64
------------
Offering price per share -- Class A $ 50.32
------------
Net asset value and offering price per
share -- Class B (D) $ 44.40
------------
Net asset value and offering price per
share -- Class C (E) $ 47.49
Maximum sales charge of 1.00% (F) 0.48
------------
Offering price per share -- Class C $ 47.97
------------
Net asset value, offering price, and redemption
price per share -- Class Y $ 48.60
------------
TECHNOLOGY FUND (CONCLUDED)
DESCRIPTION
--------------------------------------------------------------------------------
*Non-income producing security
(A) This money market fund is advised by U.S. Bank National Association who also
serves as advisor for this fund. See the notes to the financial statements.
(B) Other assets and liabilities representing greater than five percent of total
net assets include the following (000):
Collateral received for securities loaned, at value $ 236,879
Payable upon return of securities loaned $(236,879)
(C) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 5.25%.
(D) Class B has a contingent deferred sales charge. For a description of a
possible redmption charge, see the notes to the financial statements.
(E) Class C has a contingent deferred sales charge. For a description of a
possible redmption charge, see the notes to the financial statements.
(F) The offering price is calculated by dividing the net asset value by 1 minus
the maximum sales charge of 1.00%.
ADR--American Depositary Receipt
Cl--Class
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 95)
<PAGE>
STATEMENTS OF OPERATIONS for the year ended September 30, 2000 in thousands
<TABLE>
<CAPTION>
HEALTH SCIENCES REAL ESTATE TECHNOLOGY
FUND SECURITIES FUND FUND
---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest $ 70+ $ 168+ $ 1,286+
Dividends 121 3,914 82
---------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT INCOME 191 4,082 1,368
=========================================================================================================
EXPENSES:
Investment advisory fees 146 376 4,307
Less: Waiver of investment advisory fees (61) (101) --
Administrator fees 23 59 669
Transfer agent fees 69 67 208
Custodian fees 6 16 183
Directors' fees -- 1 9
Registration fees 1 2 28
Professional fees 1 1 15
Printing 1 4 40
Distribution fees - Class A 9 4 276
Distribution fees - Class B 25 18 751
Distribution fees - Class C 7 -- 106
Other 2 5 31
---------------------------------------------------------------------------------------------------------
TOTAL NET EXPENSES 229 452 6,623
=========================================================================================================
Investment income (loss) - net (38) 3,630 (5,255)
---------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAINS (LOSSES)
ON INVESTMENTS - NET:
Net realized gain (loss) on investments 3,404 (5,831) 131,445
Net change in unrealized appreciation of investments 6,835 15,034 43,672
---------------------------------------------------------------------------------------------------------
NET GAIN ON INVESTMENTS 10,239 9,203 175,117
=========================================================================================================
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $10,201 $ 12,833 $169,862
=========================================================================================================
</TABLE>
+Includes income from securities lending program. See the Notes to the Financial
Statements for additional information.
The accompanying notes are an integral part of the financial statements.
(96 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS in thousands
<TABLE>
<CAPTION>
HEALTH REAL ESTATE TECHNOLOGY
SCIENCES FUND SECURITIES FUND FUND
------------------------------------------------------------------------------------------------------------------------------
10/1/99 10/1/98 10/1/99 10/1/98 10/1/99 10/1/98
to to to to to to
9/30/00 9/30/99 9/30/00 9/30/99 9/30/00 9/30/99
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Investment income (loss) - net $ (38) $ 62 $ 3,630 $ 3,642 $ (5,255) $ (1,131)
Net realized gain (loss) on investments 3,404 873 (5,831) (2,768) 131,445 75,918
Net change in unrealized appreciation or depreciation
of investments 6,835 717 15,034 (4,255) 43,672 64,625
------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations 10,201 1,652 12,833 (3,381) 169,862 139,412
------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Investment income - net:
Class A -- (2) (102) (103) -- --
Class B -- -- (106) (135) -- --
Class C -- -- (1) -- --
Class Y (2) (69) (3,583) (3,471) -- --
Net realized gain on investments:
Class A -- (5) -- -- (7,867) (394)
Class B -- (3) -- -- (7,758) (372)
Class C -- -- -- -- -- --
Class Y -- (103) -- -- (70,350) (4,508)
Tax return of capital:
Class A -- -- (4) (4) -- --
Class B -- -- (5) (6) -- --
Class C -- -- -- -- -- --
Class Y -- -- (138) (122) -- --
------------------------------------------------------------------------------------------------------------------------------
Total distributions (2) (182) (3,939) (3,841) (85,975) (5,274)
------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS(1):
Class A:
Proceeds from sales 4,777 1,237 772 368 226,127 55,576
Reinvestment of distributions -- 6 91 93 7,203 365
Payments for redemptions (1,336) (1,967) (601) (751) (96,618) (51,670)
------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from Class A
transactions 3,441 (724) 262 (290) 136,712 4,271
------------------------------------------------------------------------------------------------------------------------------
Class B:
Proceeds from sales 2,706 554 315 748 82,706 5,643
Reinvestment of distributions -- 3 92 109 7,621 367
Payments for redemptions (686) (191) (995) (1,384) (17,275) (2,456)
------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from Class B
transactions 2,020 366 (588) (527) 73,052 3,554
------------------------------------------------------------------------------------------------------------------------------
Class C:
Proceeds from sales 3,975 -- 167 -- 39,844 --
Reinvestment of distributions -- -- 1 -- -- --
Payments for redemptions (60) -- (7) -- (1,945) --
------------------------------------------------------------------------------------------------------------------------------
Increase in net assets from Class C transactions 3,915 -- 161 -- 37,899 --
------------------------------------------------------------------------------------------------------------------------------
Class Y:
Proceeds from sales 3,248 441 14,679 21,511 242,912 26,847
Reinvestment of distributions -- 9 337 468 19,875 968
Payments for redemptions (3,039) (11,597) (18,216) (22,377) (128,235) (28,988)
------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from Class Y
transactions 209 (11,147) (3,200) (398) 134,552 (1,173)
------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from capital share
transactions 9,585 (11,505) (3,365) (1,215) 382,215 6,652
------------------------------------------------------------------------------------------------------------------------------
Total increase (decrease) in net assets 19,784 (10,035) 5,529 (8,437) 466,102 140,790
NET ASSETS AT BEGINNING OF PERIOD 14,604 24,639 54,891 63,328 256,977 116,187
==============================================================================================================================
NET ASSETS AT END OF PERIOD (2) $ 34,388 $ 14,604 $ 60,420 $ 54,891 $723,079 $256,977
==============================================================================================================================
</TABLE>
(1)See note 4 in the notes to the
financial statements for
additional information.
(2)Includes undistributed
(distributions in excess of) net
investment income (000) of $0
and $0 for Health Sciences Fund,
$(69) and $(19) for Real Estate
Securities Fund, and $0 and $0
for Technology Fund at September
30, 2000, and September 30,
1999, respectively.
The accompanying notes are an integral part of the financial statements.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 97)
<PAGE>
FINANCIAL HIGHLIGHTS For a share outstanding, throughout the periods ended
September 30, unless otherwise indicated
<TABLE>
<CAPTION>
REALIZED AND
NET ASSET UNREALIZED DIVIDENDS DISTRIBUTIONS
VALUE NET GAINS OR FROM NET DISTRIBUTIONS FROM
BEGINNING INVESTMENT (LOSSES) ON INVESTMENT FROM RETURN OF
OF PERIOD INCOME (LOSS) INVESTMENTS INCOME CAPITAL GAINS CAPITAL
-----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
HEALTH SCIENCES FUND
Class A
2000 $ 8.24 $ (0.02) $ 5.12 $ -- $ -- $ --
1999 7.82 0.01 0.46 (0.01) (0.04) --
1998 12.05 0.01 (2.78) -- (1.46) --
1997 9.86 (0.01) 2.30 -- (0.10) --
1996(1) 10.00 0.01 (0.14) (0.01) -- --
Class B
2000 $ 8.02 $ (0.08) $ 4.95 $ -- $ -- $ --
1999 7.65 0.01 0.40 -- (0.04) --
1998 11.90 (0.02) (2.77) -- (1.46) --
1997 9.81 (0.01) 2.20 -- (0.10) --
1996(1) 10.00 (0.02) (0.16) (0.01) -- --
Class C
2000(2) $ 9.76 $ (0.03) $ 3.56 $ -- $ -- $ --
Class Y
2000 $ 8.28 $ -- $ 5.14 $ -- $ -- $ --
1999 7.84 0.04 0.48 (0.04) (0.04) --
1998 12.08 0.03 (2.78) (0.03) (1.46) --
1997 9.87 (0.01) 2.33 (0.01) (0.10) --
1996(1) 10.00 0.03 (0.15) (0.01) -- --
-----------------------------------------------------------------------------------------------------------
REAL ESTATE SECURITIES
FUND
Class A
2000 $ 10.78 $ 0.74 $ 2.00 $ (0.79) $ -- $ (0.02)
1999 12.17 0.65 (1.36) (0.67) -- (0.01)
1998 14.97 0.63 (2.40) (0.70)(B) (0.33) --
1997 11.52 0.72 3.42 (0.65) (0.03) (0.01)
1996 10.38 0.52 1.30 (0.51) -- (0.17)
Class B
2000 $ 10.69 $ 0.64 $ 2.00 $ (0.69) $ -- $ (0.03)
1999 12.08 0.55 (1.34) (0.57) -- (0.03)
1998 14.86 0.52 (2.37) (0.60)(B) (0.33) --
1997 11.46 0.63 3.38 (0.57) (0.03) (0.01)
1996 10.37 0.44 1.27 (0.45) -- (0.17)
Class C
2000(2) $ 10.61 $ 0.50 $ 2.14 $ (0.57) $ -- $ --
Class Y
2000 $ 10.80 $ 0.77 $ 2.00 $ (0.81) $ -- $ (0.03)
1999 12.19 0.68 (1.35) (0.69) -- (0.03)
1998 14.99 0.67 (2.40) (0.74)(B) (0.33) --
1997 11.53 0.74 3.43 (0.67) (0.03) (0.01)
1996 10.37 0.57 1.29 (0.53) -- (0.17)
-----------------------------------------------------------------------------------------------------------
</TABLE>
+Returns are for the period indicated and have not been annualized.
(A)Excluding sales charges.
(B)Includes distributions in excess of net investment income.
(1)Commenced operations on January 31, 1996. All ratios for the period have
been annualized.
(2)Commenced operations on February 1, 2000. All ratios for the period have
been annualized.
The accompanying notes are an integral part of the financial statements.
(98 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
<TABLE>
<CAPTION>
RATIO OF NET
RATIO OF INVESTMENT
RATIO OF NET EXPENSES TO INCOME (LOSS)
NET ASSET RATIO OF INVESTMENT AVERAGE TO AVERAGE
VALUE NET ASSETS EXPENSES TO INCOME (LOSS) NET ASSETS NET ASSETS PORTFOLIO
END OF TOTAL END OF AVERAGE TO AVERAGE (EXCLUDING (EXCLUDING TURNOVER
PERIOD RETURN (A) PERIOD (000) NET ASSETS NET ASSETS WAIVERS) WAIVERS) RATE
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 13.34 61.89% $ 6,645 1.17% (0.27)% 1.46% (0.56)% 104%
8.24 6.08 1,383 1.16 0.11 1.30 (0.03) 53
7.82 (25.24) 2,017 1.15 0.04 1.20 (0.01) 45
12.05 23.60 849 1.15 (0.20) 1.29 (0.34) 54
9.86 (1.32)+ 629 1.15 0.18 2.12 (0.79) 19
$ 12.89 60.72% $ 4,221 1.92% (1.02)% 2.21% (1.31)% 104%
8.02 5.37 1,029 1.92 (0.64) 2.05 (0.77) 53
7.65 (25.80) 645 1.90 (0.73) 1.95 (0.78) 45
11.90 22.69 516 1.90 (0.94) 2.04 (1.08) 54
9.81 (1.86)+ 281 1.90 (0.61) 2.87 (1.58) 19
$ 13.29 36.17%+ $ 4,347 1.92% (1.02)% 2.21% (1.31)% 104%
$ 13.42 62.10% $19,175 0.92% (0.02)% 1.21% (0.31)% 104%
8.28 6.59 12,192 0.90 0.38 1.05 0.23 53
7.84 (25.10) 21,977 0.90 0.27 0.95 0.22 45
12.08 23.89 41,243 0.90 0.06 1.04 (0.08) 54
9.87 (1.20)+ 12,485 0.90 0.43 1.87 (0.54) 19
--------------------------------------------------------------------------------------------------------------------
$ 12.71 26.68% $ 2,035 1.05% 6.59% 1.24% 6.40% 45%
10.78 (5.89) 1,518 1.05 5.52 1.18 5.39 21
12.17 (12.42) 2,027 1.05 4.71 1.18 4.58 36
14.97 36.77 2,105 1.05 4.46 1.30 4.21 14
11.52 18.17 226 1.05 4.36 1.76 3.65 8
$ 12.61 25.81% $ 1,874 1.80% 5.79% 1.99% 5.60% 45%
10.69 (6.68) 2,192 1.80 4.75 1.93 4.62 21
12.08 (13.04) 3,026 1.80 3.98 1.93 3.85 36
14.86 35.77 3,318 1.80 3.61 2.00 3.41 14
11.46 17.00 263 1.80 4.29 2.51 3.58 8
$ 12.68 25.56%+ $ 164 1.80% 5.79% 1.99% 5.60% 45%
$ 12.73 26.95% $56,347 0.80% 6.79% 0.99% 6.60% 45%
10.80 (5.64) 51,181 0.80 5.78 0.93 5.65 21
12.19 (12.18) 58,275 0.80 5.06 0.93 4.93 36
14.99 37.07 40,501 0.80 4.57 1.05 4.32 14
11.53 18.53 17,895 0.80 5.13 1.51 4.42 8
--------------------------------------------------------------------------------------------------------------------
</TABLE>
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 99)
<PAGE>
FINANCIAL HIGHLIGHTS For a share outstanding, throughout the periods ended
September 30, unless otherwise indicated
<TABLE>
<CAPTION>
REALIZED AND
NET ASSET UNREALIZED DIVIDENDS DISTRIBUTIONS
VALUE NET GAINS OR FROM NET DISTRIBUTIONS FROM
BEGINNING INVESTMENT (LOSSES) ON INVESTMENT FROM RETURN OF
OF PERIOD INCOME (LOSS) INVESTMENTS INCOME CAPITAL GAINS CAPITAL
------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
TECHNOLOGY FUND
Class A
2000 $ 34.22 $ (0.35) $ 24.87 $ -- $ (11.06) $ --
1999 15.60 (0.18) 19.55 -- (0.75) --
1998 20.20 (0.13) (3.26) -- (1.21) --
1997 19.25 (0.11) 3.12 -- (2.06) --
1996 18.24 (0.05) 2.95 -- (1.89) --
Class B
2000 $ 32.59 $ (0.35) $ 23.22 $ -- $ (11.06) $ --
1999 14.99 (0.34) 18.69 -- (0.75) --
1998 19.58 (0.24) (3.14) -- (1.21) --
1997 18.85 (0.20) 2.99 -- (2.06) --
1996 18.02 (0.14) 2.86 -- (1.89) --
Class C
2000(1) $ 50.30 $ (0.35) $ (2.46) $ -- $ -- $ --
Class Y
2000 $ 34.64 $ (0.34) $ 25.36 $ -- $ (11.06) $ --
1999 15.73 (0.13) 19.79 -- (0.75) --
1998 20.29 (0.08) (3.27) -- (1.21) --
1997 19.29 (0.06) 3.12 -- (2.06) --
1996 18.24 (0.04) 2.98 -- (1.89) --
------------------------------------------------------------------------------------------------------
</TABLE>
+Returns are for the period indicated and have not been annualized.
(A)Excludes sales charges.
(1)Commenced operations on February 1, 2000. All ratios for the period have
been annualized.
The accompanying notes are an integral part of the financial statements.
(100 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
<TABLE>
<CAPTION>
RATIO OF NET
RATIO OF INVESTMENT
RATIO OF NET EXPENSES TO INCOME (LOSS)
NET ASSET RATIO OF INVESTMENT AVERAGE TO AVERAGE
VALUE NET ASSETS EXPENSES TO INCOME (LOSS) NET ASSETS NET ASSETS PORTFOLIO
END OF TOTAL END OF AVERAGE TO AVERAGE (EXCLUDING (EXCLUDING TURNOVER
PERIOD RETURN (A) PERIOD (000) NET ASSETS NET ASSETS WAIVERS) WAIVERS) RATE
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 47.68 80.11% $155,533 1.15% (0.93)% 1.15% (0.93)% 195%
34.22 128.71 21,491 1.15 (0.80) 1.16 (0.81) 184
15.60 (16.69) 7,703 1.15 (0.60) 1.15 (0.60) 124
20.20 17.71 5,564 1.15 (0.59) 1.17 (0.61) 150
19.25 18.60 4,799 1.15 (0.85) 1.26 (0.96) 119
$ 44.40 78.77% $ 97,003 1.90% (1.68)% 1.90% (1.68)% 195%
32.59 127.09 20,866 1.90 (1.56) 1.91 (1.57) 184
14.99 (17.21) 7,499 1.90 (1.38) 1.90 (1.38) 124
19.58 16.82 8,463 1.90 (1.41) 1.92 (1.43) 150
18.85 17.75 4,881 1.90 (1.60) 2.01 (1.71) 119
$ 47.49 (5.59)%+ $ 33,605 1.90% (1.67)% 1.88% (1.65)% 195%
$ 48.60 80.71% $436,938 0.90% (0.67)% 0.90% (0.67)% 195%
34.64 129.52 214,620 0.90 (0.53) 0.91 (0.54) 184
15.73 (16.41) 100,985 0.90 (0.38) 0.90 (0.38) 124
20.29 17.95 148,659 0.90 (0.41) 0.92 (0.43) 150
19.29 18.85 64,602 0.90 (0.60) 1.01 (0.71) 119
-----------------------------------------------------------------------------------------------------------------------
</TABLE>
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 101)
<PAGE>
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2000
1 > ORGANIZATION
The First American Balanced Fund, Equity Income Fund, Equity Index Fund,
Large Cap Growth Fund, Large Cap Value Fund, Mid Cap Growth Fund, Mid Cap
Value Fund, Small Cap Growth Fund, Small Cap Value Fund, Emerging Markets
Fund, International Fund, International Index Fund, Health Sciences Fund,
Real Estate Securities Fund, and Technology Fund (each "Fund" and
collectively, the "Funds") are mutual funds offered by First American
Investment Funds, Inc. (FAIF). Other funds that are offered by FAIF but are
not included in this report are First American Corporate Bond Fund, Limited
Term Income Fund, Intermediate Term Income Fund, Fixed Income Fund,
Strategic Income Fund, Arizona Tax Free Fund, California Intermediate Tax
Free Fund, California Tax Free Fund, Colorado Intermediate Tax Free Fund,
Colorado Tax Free Fund, Intermediate Tax Free Fund, Minnesota Intermediate
Tax Free Fund, Minnesota Tax Free Fund, Tax Free Fund, and Oregon
Intermediate Tax Free Fund. FAIF is registered under the Investment Company
Act of 1940, as amended, as an open-end management investment company.
FAIF's articles of incorporation permit the Board of Directors to create
additional funds in the future.
FAIF offers Class A, Class B, Class C and Class Y shares. Class A shares
are sold with a front-end sales charge. Class B shares may be subject to a
contingent deferred sales charge for six years and automatically convert to
Class A shares after eight years. Class C shares are sold with a front end
sales charge and may be subject to a contingent deferred sales charge for
18 months. Class Y shares have no sales charge and are offered only to
qualifying institutional investors.
The Funds' prospectuses provide descriptions of each Fund's investment
objectives, policies and strategies. All Classes of shares have identical
voting, dividend, liquidation and other rights, and the same terms and
conditions, except that the level of distribution fees charged may differ
among Classes.
2 > SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The significant accounting policies followed by the Funds are as follows:
SECURITY VALUATION - Security valuations for FAIF fund investments are
furnished by independent pricing services that have been approved by the
Board of Directors. Investments in equity securities that are traded on a
national securities exchange (or reported on the NASDAQ national market
system) are stated at the last quoted sales price if readily available for
such securities on each business day. Other equity securities traded in the
over-the-counter market and listed equity securities for which no sale was
reported on that date are stated at the last quoted bid price. Debt
obligations exceeding sixty days to maturity are valued by an independent
pricing service. The pricing service may employ methodologies that utilize
actual market transactions, broker-dealer supplied valuations, or other
electronic data processing techniques. These techniques generally consider
such factors as yields or prices of bonds of comparable quality, type of
issue, coupon, maturity, ratings and general market conditions. Securities
for which prices are not available from an independent pricing service but
where an active market exists are valued using market quotations obtained
from one or more dealers that make markets in the securities or from a
widely-used quotation system. When market quotations are not readily
available, securities are valued at fair value as determined in good faith
by procedures established and approved by the Board of Directors. Debt
obligations with sixty days or less remaining until maturity may be valued
at their amortized cost. Foreign securities are valued at the closing
prices on the principal exchange on which they trade. The prices for
foreign securities are reported in local currency and converted to U.S.
dollars using currency exchange rates. Exchange rates are provided daily by
recognized independent pricing agents.
SECURITY TRANSACTIONS AND INVESTMENT INCOME - The Funds record security
transactions on the trade date of the security purchase or sale. Dividend
income is recorded on the ex-dividend date. Interest income, including
amortization of bond premium and discount, is recorded on the accrual
basis. Security gains and losses are determined on the basis of identified
cost, which is the same basis used for federal income tax purposes.
(102 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
DISTRIBUTIONS TO SHAREHOLDERS - Balanced Fund, Equity Income Fund, Equity
Index Fund, Large Cap Growth Fund, Large Cap Value Fund, Mid Cap Growth
Fund and Mid Cap Value Fund declare and pay income dividends monthly. Small
Cap Growth Fund, Small Cap Value Fund, International Index Fund, Health
Sciences Fund, Real Estate Securities Fund and Technology Fund declare and
pay income dividends quarterly. Emerging Markets Fund and International
Fund declare and pay dividends annually.
Due to the nature of the dividends received by the Real Estate Securities
Fund on its securities holdings, a portion of the quarterly distributions
of the Real Estate Securities Fund may be a return of capital. Any net
realized capital gains on sales of a fund's securities are distributed to
shareholders at least annually.
FEDERAL TAXES - It is each Fund's intention to continue to qualify as a
regulated investment company and distribute all of its taxable income.
Accordingly, no provision for Federal income taxes is required. For Federal
tax purposes, required distributions related to realized gains for security
transactions are computed as of September 30th or October 31st.
The character of distributions made during the year from net investment
income or net realized gains may differ from its ultimate characterization
for Federal income tax purposes. In addition, due to the timing of dividend
distributions, the fiscal year in which the amounts are distributed may
differ from the year that the income or realized gains (losses) were
recorded by the Fund.
Net investment income and net realized gains (losses) may differ for
financial statement and tax purposes because of temporary or permanent
book/tax differences. These differences are primarily due to losses
deferred due to wash sales, foreign currency gains and losses and the
"mark-to-market" of certain Passive Foreign Investment Companies (PFICs)
for tax purposes. To the extent these differences are permanent,
adjustments are made to the appropriate equity accounts in the period that
the difference arises.
On the Statements of Net Assets the following adjustments were made for
permanent tax adjustments (000):
ACCUMULATED UNDISTRIBUTED
NET REALIZED NET INVESTMENT
GAIN (LOSS) INCOME PAID-IN-CAPITAL
--------------------------------------------------------------------------
Equity Income Fund $ (17) $ 17 $ --
Large Cap Growth Fund -- 3,407 (3,407)
Mid Cap Growth Fund (3,191) 3,191 --
Small Cap Growth Fund (1,641) 1,641 --
Emerging Markets Fund (18) 313 (295)
International Fund (2,529) 2,426 103
International Index Fund 221 (221) --
Health Sciences Fund (40) 40 --
Real Estate Securities Fund 284 112 (396)
Technology Fund (5,255) 5,255 --
--------------------------------------------------------------------------
At September 30, 2000, the following funds have capital loss carryforwards:
AMOUNT (000) EXPIRATION DATE
---------------------------------------------------------------------------
Mid Cap Value Fund $128,958 2007-2008
Emerging Markets Fund 740 2007
Real Estate Securities Fund 8,981 2008
---------------------------------------------------------------------------
The amount for the Real Estate Securities Fund is an estimate because its
tax year end is December 31.
The Mid Cap Value Fund incurred a loss for tax purposes in the amount of
$3,743,000 for November 1, 1999, to September 30, 2000. As permitted by tax
regulations, the Fund intends to elect to defer and treat these losses as
arising in the fiscal year ended September 30, 2000.
FUTURES TRANSACTIONS - In order to gain exposure to or protect against
changes in the market, certain Funds may enter into S&P Stock Index futures
contracts and other stock futures contracts.
Upon entering into a futures contract, the Fund is required to deposit cash
or pledge U.S. government securities in an amount equal to five percent of
the purchase price indicated in the futures contract (initial margin).
Subsequent payments, which are dependent on the daily fluctuations in the
value of the underlying security or securities, are made or received by the
Fund each day (daily variation margin) and are recorded as unrealized gains
or losses until the contract is closed. When the contract is closed, the
Fund records a realized gain or loss equal to the difference between the
proceeds from (or cost of) the closing transaction and the Fund's basis in
the contract.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 103)
<PAGE>
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2000
FOREIGN CURRENCY TRANSLATION - The books and records of the Emerging
Markets Fund, International Fund and International Index Fund are
maintained in U.S. dollars on the following basis:
* market value of investment securities, assets and liabilities at the
current rate of exchange; and
* purchases and sales of investment securities, income and expenses at
the relevant rates of exchange prevailing on the respective dates of
such transactions.
The Emerging Markets Fund, International Fund and International Index Fund
do not isolate the portion of gains and losses on investments in equity
securities that is due to changes in the foreign exchange rates from that
which is due to changes in market prices of equity securities.
The Emerging Markets Fund, International Fund and International Index Fund
report certain foreign currency-related transactions as components of
realized gains for financial reporting purposes, whereas such components
are treated as ordinary income for federal income tax purposes.
FORWARD FOREIGN CURRENCY CONTRACTS - The Emerging Markets Fund,
International Fund and International Index Fund may enter into forward
foreign currency contracts as hedges against either specific transactions
or fund positions. The aggregate principal amount of the contracts are not
recorded because the Emerging Markets Fund, International Fund and
International Index Fund intend to settle the contracts prior to delivery.
All commitments are "marked-to-market" daily at the applicable foreign
exchange rate, and any resulting unrealized gains or losses are recorded
currently. The Emerging Markets Fund, International Fund and International
Index Fund realize gains or losses at the time the forward contracts are
extinguished. Unrealized gains or losses on outstanding positions in
forward foreign currency contracts held at the close of the period are
recognized as ordinary income or loss for federal income tax purposes.
EXPENSES - Expenses that are directly related to one of the Funds are
charged directly to that Fund. Other operating expenses are allocated to
the Funds on the basis of relative net assets. Class specific expenses,
such as the 12b-1 fees, are borne by that Class. Income, other expenses and
realized and unrealized gains and losses of a Fund are allocated to the
respective Class on the basis of the relative net assets each day.
OPTIONS TRANSACTIONS - In order to hedge against market risks certain Funds
may write covered call options and purchase put options on stock indices
and on securities in which the Funds invest. Options are valued daily based
upon the last sales price on the principal exchange on which the option is
traded, and the Fund records the unrealized gain or loss. A Fund will
realize a gain or loss upon the expiration or closing of the options
contract.
SECURITIES LENDING - Each Fund may lend up to one-third of the value of its
total assets to broker-dealers, banks or other institutional borrowers of
securities in order to earn additional income. Each Fund's policy is to
maintain collateral in the form of cash, U.S. Government securities or
other high grade debt obligations equal to at least 100% of the value of
securities loaned. The collateral is then "marked-to-market" daily until
the securities are returned.
USE OF ESTIMATES IN PREPARATION OF FINANCIAL STATEMENTS - The preparation
of financial statements, in conformity with accounting principles generally
accepted in the United States, requires management to make estimates and
assumptions that affect the reported amount of net assets and liabilities
and disclosure of contingent assets and liabilities at the date of the
financial statements and the reported results of operations during the
reporting period. Actual results could differ from those estimates.
3 > FEES AND EXPENSES
ADVISOR FEES - Pursuant to an investment advisory agreement (the
"Agreement"), First American Asset Management (the "Advisor"), a division
of U.S. Bank National Association ("U.S. Bank"), manages each Fund's assets
and furnishes related office facilities, equipment, research and personnel.
The Agreement requires each Fund to pay the Advisor a monthly fee based
upon average daily net assets. The fee for each Fund, other than the
International Fund and Emerging Markets Fund, is equal to an annual rate of
.70% of the average daily net assets. The fee for the International Fund
and Emerging Markets Fund is equal to an annual rate of 1.25% of average
daily net assets. The Advisor intends to waive fees during the current
fiscal year so that total fund operating expenses do not exceed expense
limitations described in the Funds' prospectuses. Fee waivers may be
discontinued at any time.
The Funds may invest in First American Funds, Inc. (FAF), subject to
certain limitations. The terms of such transactions are identical to those
of non-related entities except that, to avoid duplicative investment
advisory fees, the Advisor
(104 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
reimburses each FAIF fund an amount equal to the investment advisory fee
earned by FAF related to such investments.
SUB-ADVISOR FEES - Marvin & Palmer Associates, Inc. serves as Sub-Advisor
to the International Fund and Emerging Markets Fund pursuant to a
Sub-Advisory Agreement with the Advisor. For International Fund, Marvin &
Palmer is paid a monthly fee by the Advisor calculated on an annual basis
equal to 0.75% of the first $100 million of International Fund's average
daily net assets, 0.50% of International Fund's average daily net assets in
excess of $100 million up to $300 million, 0.45% of International Fund's
average daily net assets in excess of $300 million up to $500 million and
0.40% of International Fund's average daily net assets in excess of $500
million. For Emerging Markets Fund, Marvin & Palmer is paid a monthly fee
by the Advisor calculated on an annual basis equal to 0.85% of the first
$100 million of Emerging Markets Fund's average daily net assets, 0.60% of
Emerging Markets Fund's average daily net assets in excess of $100 million
up to $300 million, 0.55% of Emerging Markets Fund's average daily net
assets in excess of $300 million up to $500 million, and 0.50% of Emerging
Markets Fund's average daily net assets in excess of $500 million.
ADMINISTRATION FEES - SEI Investments Mutual Fund Services ("SIMFS")
provided administrative services, including certain accounting, legal, and
shareholder services to the First American Family of Funds from October 1,
1999 through December 31, 1999. Effective January 1, 2000, U.S. Bank was
appointed as the administrator and began providing administrative services
to the First American Family of Funds. Under both arrangements, the Funds
are charged an annual rate of 0.12% of each FAIF Fund's average daily net
assets, with a minimum annual fee of $50,000. To the extent that aggregate
net assets of the First American Family of Funds exceed $8 billion, the
annual rate for each FAIF Fund is reduced to 0.105% of its respective share
of excess net assets. Fees are computed daily and paid monthly.
SUB-ADMINISTRATION FEES - U.S. Bank assisted SIMFS and provided
sub-administration services for the Funds from October 1, 1999 through
December 31, 1999. For these services SIMFS compensated U.S. Bank, as sub-
administrator, monthly at an annual rate of up to 0.05% of each Fund's
average daily net assets. The fees for each Fund from October 1, 1999
through December 31, 1999 were approximately 0.017% of average daily net
assets. Under this arrangement, SIMFS paid U.S. Bank $2,646,000 for the
First American Family of Funds in aggregate for this three month period.
Effective January 1, 2000 SIMFS was appointed sub-administrator and began
assisting U.S. Bank in providing sub-administration services for the Funds.
For these services, U.S. Bank compensates SIMFS monthly at an annual rate
equal to 0.05% of aggregate average daily net assets of FAIF. In addition,
SIMFS also receives 0.015% on assets up to $34.5 billion, 0.0075% on the
next $25.5 billion and 0.005% on assets over $60 billion for all Funds.
There is a minimum $50,000 per Fund fee (the oldest 38 Funds are excluded).
U.S. Bank paid SIMFS $8,501,000 in aggregate from January 1, 2000 through
September 30, 2000 for the First American Family of Funds. For the Funds
included in this annual report the amounts paid to U.S. Bank and SIMFS for
the year ended September 30, 2000 were as follows (000):
U.S. BANK SIMFS
---------------------------------------------------------------------------
Balanced Fund $ 38 $191
Equity Income Fund 31 156
Equity Index Fund 126 834
Large Cap Growth Fund 93 641
Large Cap Value Fund 128 697
Mid Cap Growth Fund 36 291
Mid Cap Value Fund 26 140
Small Cap Growth Fund 28 253
Small Cap Value Fund 26 212
Emerging Markets Fund 4 32
International Fund 56 436
International Index Fund 12 63
Health Sciences Fund 1 11
Real Estate Fund 4 26
Technology Fund 30 338
---------------------------------------------------------------------------
CUSTODIAN FEES - Through a separate contractual agreement, U.S. Bank serves
as the Funds' custodian. The fee for each Fund, other than Emerging Markets
Fund, International Fund and International Index Fund, is equal to an
annual rate of 0.03% of average daily net assets. The fee for Emerging
Markets Fund, International Fund, and International Index Fund is equal to
an annual rate of 0.10% of average daily net assets. All fees are computed
daily and paid monthly.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 105)
<PAGE>
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2000
DISTRIBUTION FEES - SEI Investments Distribution Co. ("SIDCO") serves as
distributor of the Funds. Under the respective distribution plan, each of
the Funds pay SIDCO a monthly distribution fee equal to an annual rate of
0.25% of each Fund's average daily net assets of the Class A shares and
1.00% of the Class B shares and 1.00% Class C shares, which may be used by
SIDCO to provide compensation for sales support and distribution
activities. No distribution fees are paid by Class Y shares. Under the
agreement, SIDCO paid the following amounts to affiliates of U.S. Bank for
the year ended September 30, 2000 (000):
U.S. BANCORP
U.S. BANK PIPER JAFFRAY U.S. BANK TRUST
---------------------------------------------------------------------------
Balanced Fund $163 $ 71 $10
Equity Income Fund 37 16 2
Equity Index Fund 254 166 18
Large Cap Growth Fund 82 372 34
Large Cap Value Fund 160 240 10
Mid Cap Growth Fund 5 526 6
Mid Cap Value Fund 43 10 2
Small Cap Growth Fund 15 105 2
Small Cap Value Fund 39 12 2
Emerging Markets Fund -- 10 --
International Fund 19 145 6
International Index Fund 5 3 --
Health Sciences Fund 4 6 --
Real Estate Fund 3 2 --
Technology Fund 98 106 9
---------------------------------------------------------------------------
TRANSFER AGENT FEES - From October 1, 1999 to December 31, 1999, DST
Systems, Inc. provided transfer agency services for the Funds. Effective
January 1, 2000, U.S. Bank was appointed as transfer agent and dividend
disbursement agent. As the servicing agent, U.S. Bank was paid $9,862,000
in aggregate for the year ended September 30, 2000 for the First American
Family of Funds. For the year ended September 30, 2000, transfer agent fees
paid to U.S. Bank for the funds included in this annual report were as
follows (000):
---------------------------------------------------------------------------
Balanced Fund $169
Equity Income Fund 61
Equity Index Fund 404
Large Cap Growth Fund 308
Large Cap Value Fund 370
Mid Cap Growth Fund 308
Mid Cap Value Fund 127
Small Cap Growth Fund 121
Small Cap Value Fund 146
Emerging Markets Fund 58
International Fund 184
International Index Fund 35
Health Sciences Fund 38
Real Estate Securities Fund 34
Technology Fund 286
---------------------------------------------------------------------------
OTHER FEES - In addition to the investment advisory and management fees,
custodian fees, distribution fees, administrator and transfer agent fees,
each Fund is responsible for paying most other operating expenses including
organization costs, fees and expenses of outside directors, registration
fees, printing shareholder reports, legal, auditing, insurance and other
miscellaneous expenses.
For the year ended September 30, 2000, legal fees and expenses were paid to
a law firm of which the Assistant Secretaries of the Funds are partners.
SALES CHARGES - A Contingent Deferred Sales Charge ("CDSC") is imposed on
redemptions made in the Class B shares. The CDSC varies depending on the
number of years from time of payment for the purchase of Class B shares
until the redemption of such shares.
CDSC
AS A PERCENTAGE OF DOLLAR
YEAR SINCE PURCHASE AMOUNT SUBJECT TO CHARGE
---------------------------------------------------------------------------
First 5.00%
Second 5.00%
Third 4.00%
Fourth 3.00%
Fifth 2.00%
Sixth 1.00%
Seventh --
Eighth --
---------------------------------------------------------------------------
Class B shares will automatically convert to Class A shares eight years
after the first day of the month shares are purchased.
A CDSC of 1.00% is imposed on redemptions made in Class C shares for the
first eighteen months.
The CDSC for Class B shares and Class C shares is imposed on the value of
the purchased shares, or the value at the time of redemption, whichever is
less.
For the year ended September 30, 2000, sales charges retained by SIDCO for
distributing the First American Family of Funds' shares were approximately
$239,000.
(106) FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
4 > CAPITAL SHARE TRANSACTIONS
Capital share transactions for the Funds were as follows (000):
<TABLE>
<CAPTION>
BALANCED EQUITY EQUITY
FUND INCOME FUND INDEX FUND
-------------------------------------------------------------------------------------------------------------------------
10/1/99 10/1/98 10/1/99 10/1/98 10/1/99 10/1/98
to to to to to to
9/30/00 9/30/99 9/30/00 9/30/99 9/30/00 9/30/99
-------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A:
Shares issued 795 1,016 471 728 1,875 2,912
Shares issued in lieu of cash distributions 626 776 81 47 135 74
Shares redeemed (2,216) (2,208) (477) (287) (1,503) (891)
-------------------------------------------------------------------------------------------------------------------------
TOTAL CLASS A TRANSACTIONS (795) (416) 75 488 507 2,095
=========================================================================================================================
Class B:
Shares issued 289 534 123 223 1,148 2,037
Shares issued in lieu of cash distributions 523 583 52 40 100 50
Shares redeemed (1,341) (851) (227) (120) (753) (331)
-------------------------------------------------------------------------------------------------------------------------
TOTAL CLASS B TRANSACTIONS (529) 266 (52) 143 495 1,756
=========================================================================================================================
Class C:
Shares issued 57 102 77 107 780 684
Shares issued in lieu of cash distributions 13 1 9 -- 19 1
Shares redeemed (53) -- (39) -- (202) (23)
-------------------------------------------------------------------------------------------------------------------------
TOTAL CLASS C TRANSACTIONS 17 103 47 107 597 662
=========================================================================================================================
Class Y:
Shares issued 6,286 6,963 2,047 3,513 17,708 17,985
Shares issued in lieu of cash distributions 2,967 4,481 233 210 1,353 1,350
Shares redeemed (15,935) (17,997) (7,378) (4,646) (15,863) (20,437)
-------------------------------------------------------------------------------------------------------------------------
TOTAL CLASS Y TRANSACTIONS (6,682) (6,553) (5,098) (923) 3,198 (1,102)
=========================================================================================================================
NET (DECREASE) INCREASE IN CAPITAL SHARES (7,989) (6,600) (5,028) (185) 4,797 3,411
=========================================================================================================================
<CAPTION>
LARGE CAP LARGE CAP MID CAP
GROWTH FUND VALUE FUND GROWTH FUND
-------------------------------------------------------------------------------------------------------------------------
10/1/99 10/1/98 10/1/99 10/1/98 10/1/99 10/1/98
to to to to to to
9/30/00 9/30/99 9/30/00 9/30/99 9/30/00 9/30/99
-------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A:
Shares issued 2,279 3,013 1,536 1,328 4,773 836
Shares issued in lieu of cash distributions 1,181 948 927 1,146 2,541 3,066
Shares redeemed (2,296) (4,125) (3,419) (2,424) (6,122) (7,075)
-------------------------------------------------------------------------------------------------------------------------
TOTAL CLASS A TRANSACTIONS 1,164 (164) (956) 50 1,192 (3,173)
=========================================================================================================================
Class B:
Shares issued 836 335 240 238 243 27
Shares issued in lieu of cash distributions 164 82 335 430 7 1
Shares redeemed (248) (133) (827) (502) (18) (1)
-------------------------------------------------------------------------------------------------------------------------
TOTAL CLASS B TRANSACTIONS 752 284 (252) 166 232 27
=========================================================================================================================
Class C:
Shares issued 785 50 268 60 286 37
Shares issued in lieu of cash distributions 10 -- 9 -- 8 --
Shares redeemed (20) (1) (19) -- (9) (1)
-------------------------------------------------------------------------------------------------------------------------
TOTAL CLASS C TRANSACTIONS 775 49 258 60 285 36
=========================================================================================================================
Class Y:
Shares issued 13,361 9,639 17,619 12,748 8,812 17,943
Shares issued in connection with acquisition of
Santa Monica Trust Fund 471 -- -- -- -- --
Shares issued in connection with acquisition of
Piper Common Trust Fund -- 487 -- -- -- --
Shares issued in lieu of cash distributions 2,201 1,348 4,556 5,553 2,422 1,200
Shares redeemed (7,928) (10,125) (22,648) (16,244) (8,620) (9,045)
-------------------------------------------------------------------------------------------------------------------------
TOTAL CLASS Y TRANSACTIONS 8,105 1,349 (473) 2,057 2,614 10,098
=========================================================================================================================
NET INCREASE (DECREASE) IN CAPITAL SHARES 10,796 1,518 (1,423) 2,333 4,323 6,988
=========================================================================================================================
</TABLE>
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 107)
<PAGE>
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2000
<TABLE>
<CAPTION>
MID CAP SMALL CAP
VALUE FUND GROWTH FUND
-----------------------------------------------------------------------------------------------------
10/1/99 10/1/98 10/1/99 10/1/98
to to to to
9/30/00 9/30/99 9/30/00 9/30/99
-----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A:
Shares issued 524 595 2,743 3,781
Shares issued in lieu of cash distributions 6 482 204 4
Shares redeemed (1,157) (1,468) (2,531) (4,240)
-----------------------------------------------------------------------------------------------------
TOTAL CLASS A TRANSACTIONS (627) (391) 416 (455)
=====================================================================================================
Class B:
Shares issued 51 79 256 70
Shares issued in lieu of cash distributions 2 496 17 --
Shares redeemed (683) (1,183) (47) (28)
-----------------------------------------------------------------------------------------------------
TOTAL CLASS B TRANSACTIONS (630) (608) 226 42
=====================================================================================================
Class C:
Shares issued 88 13 323 19
Shares issued in lieu of cash distributions -- -- 3 --
Shares redeemed (3) -- (6) --
-----------------------------------------------------------------------------------------------------
TOTAL CLASS C TRANSACTIONS 85 13 320 19
=====================================================================================================
Class Y:
Shares issued 5,589 12,012 8,310 8,081
Shares issued in lieu of cash distributions 85 4,173 708 4
Shares redeemed (10,370) (20,520) (4,399) (2,891)
-----------------------------------------------------------------------------------------------------
TOTAL CLASS Y TRANSACTIONS (4,696) (4,335) 4,619 5,194
=====================================================================================================
NET INCREASE (DECREASE) IN CAPITAL SHARES (5,868) (5,321) 5,581 4,800
=====================================================================================================
<CAPTION>
SMALL CAP EMERGING
VALUE FUND MARKETS FUND
-----------------------------------------------------------------------------------------------------
10/1/99 10/1/98 10/1/99 10/1/98
to to to to
9/30/00 9/30/99 9/30/00 9/30/99
-----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A:
Shares issued 812 342 62 43
Shares issued in connection with merger of Regional
Equity Fund and Micro Cap Value Fund 1,446 -- -- --
Shares issued in lieu of cash distributions 4 77 -- --
Shares redeemed (994) (587) (224) (331)
-----------------------------------------------------------------------------------------------------
TOTAL CLASS A TRANSACTIONS 1,268 (168) (162) (288)
=====================================================================================================
Class B:
Shares issued 55 50 12 2
Shares issued in connection with merger of Regional
Equity Fund 922 -- -- --
Shares issued in lieu of cash distributions -- 4 --
Shares redeemed (236) (27) (1) --
-----------------------------------------------------------------------------------------------------
TOTAL CLASS B TRANSACTIONS 741 27 11 2
=====================================================================================================
Class C:
Shares issued 64 8 1 --
Shares issued in lieu of cash distributions -- -- -- --
Shares redeemed (7) -- -- --
-----------------------------------------------------------------------------------------------------
TOTAL CLASS C TRANSACTIONS 57 8 1
=====================================================================================================
Class Y:
Shares issued 5,884 9,570 1,674 5,113
Shares issued in connection with merger of Regional
Equity Fund and Micro Cap Value Fund 7,381 -- -- --
Shares issued in lieu of cash distributions 94 2,014 -- --
Shares redeemed (11,099) (15,705) (1,077) (519)
-----------------------------------------------------------------------------------------------------
TOTAL CLASS Y TRANSACTIONS 2,260 (4,121) 597 4,594
=====================================================================================================
NET INCREASE (DECREASE) IN CAPITAL SHARES 4,326 (4,254) 447 4,308
=====================================================================================================
</TABLE>
(108 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
<TABLE>
<CAPTION>
INTERNATIONAL INTERNATIONAL HEALTH
FUND INDEX FUND SCIENCES FUND
----------------------------------------------------------------------------------------------------------------------
10/1/99 10/1/98 10/1/99 10/1/98 10/1/99 10/1/98
to to to to to to
9/30/00 9/30/99 9/30/00 9/30/99 9/30/00 9/30/99
----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A:
Shares issued 11,667 7,655 174 865 454 146
Shares issued in lieu of cash distributions 151 206 2 15 -- 1
Shares redeemed (10,026) (7,985) (214) (789) (124) (237)
----------------------------------------------------------------------------------------------------------------------
TOTAL CLASS A TRANSACTIONS 1,792 (124) (38) 91 330 (90)
======================================================================================================================
Class B:
Shares issued 526 85 33 46 263 67
Shares issued in lieu of cash distributions 15 13 -- 1 -- --
Shares redeemed (70) (49) (20) (4) (64) (23)
----------------------------------------------------------------------------------------------------------------------
TOTAL CLASS B TRANSACTIONS 471 49 13 43 199 44
======================================================================================================================
Class C:
Shares issued 1,193 67 2 -- 333 --
Shares issued in lieu of cash distributions 4 -- -- -- -- --
Shares redeemed (35) (2) (2) -- (6) --
----------------------------------------------------------------------------------------------------------------------
TOTAL CLASS C TRANSACTIONS 1,162 65 -- -- 327 --
======================================================================================================================
Class Y:
Shares issued 11,944 11,678 294 562 276 52
Shares issued in lieu of cash distributions 912 939 6 693 -- 1
Shares redeemed (8,701) (8,887) (2,431) (895) (320) (1,383)
----------------------------------------------------------------------------------------------------------------------
TOTAL CLASS Y TRANSACTIONS 4,155 3,730 (2,131) 360 (44) (1,330)
======================================================================================================================
NET INCREASE (DECREASE) IN CAPITAL SHARES 7,580 3,720 (2,156) 494 812 (1,376)
======================================================================================================================
<CAPTION>
REAL ESTATE TECHNOLOGY
SECURITIES FUND FUND
----------------------------------------------------------------------------------------------
10/1/99 10/1/98 10/1/99 10/1/98
to to to to
9/30/00 9/30/99 9/30/00 9/30/99
----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A:
Shares issued 66 31 4,406 2,877
Shares issued in lieu of cash distributions 8 8 190 21
Shares redeemed (55) (65) (1,962) (2,763)
----------------------------------------------------------------------------------------------
TOTAL CLASS A TRANSACTIONS 19 (26) 2,634 135
==============================================================================================
Class B:
Shares issued 29 65 1,687 223
Shares issued in lieu of cash distributions 8 10 215 22
Shares redeemed (93) (121) (357) (105)
----------------------------------------------------------------------------------------------
TOTAL CLASS B TRANSACTIONS (56) (46) 1,545 140
==============================================================================================
Class C:
Shares issued 14 -- 745 --
Shares issued in lieu of cash distributions -- -- -- --
Shares redeemed (1) -- (37) --
----------------------------------------------------------------------------------------------
TOTAL CLASS C TRANSACTIONS 13 -- 708 --
==============================================================================================
Class Y:
Shares issued 1,338 1,842 4,778 1,026
Shares issued in lieu of cash distributions 31 42 517 54
Shares redeemed (1,685) (1,922) (2,501) (1,302)
----------------------------------------------------------------------------------------------
TOTAL CLASS Y TRANSACTIONS (316) (38) 2,794 (222)
==============================================================================================
NET INCREASE (DECREASE) IN CAPITAL SHARES (340) (110) 7,681 53
==============================================================================================
</TABLE>
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 109)
<PAGE>
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2000
5 > INVESTMENT SECURITY TRANSACTIONS
During the year ended September 30, 2000, purchases of securities and
proceeds from sales of securities, other than temporary investments in
short-term securities, were as follows (000):
U.S. GOVERNMENT OTHER INVESTMENT
SECURITIES SECURITIES
---------------------------------------------------------------------------
PURCHASES SALES PURCHASES SALES
--------------------------------------------------
Balanced Fund $52,502 $80,838 $ 196,244 $ 295,966
Equity Income Fund -- -- 120,338 210,003
Equity Index Fund -- -- 331,308 254,993
Large Cap Growth Fund -- -- 634,873 580,033
Large Cap Value Fund -- -- 965,514 1,157,291
Mid Cap Growth Fund -- -- 1,145,110 1,193,744
Mid Cap Value Fund -- -- 391,514 483,468
Small Cap Growth Fund -- -- 1,099,361 1,021,151
Small Cap Value Fund -- -- 298,904 286,580
Emerging Markets Fund -- -- 90,306 84,943
International Fund -- -- 1,301,328 1,204,756
International Index Fund 889 600 13,099 46,047
Health Sciences Fund -- -- 29,630 20,740
Real Estate Securities Fund -- -- 23,329 26,901
Technology Fund -- -- 1,405,131 1,144,236
---------------------------------------------------------------------------
At September 30, 2000, the total cost of securities for Federal income tax
purposes was not materially different from amounts reported for financial
reporting purposes. The aggregate gross unrealized appreciation and
depreciation for securities held by the Funds at September 30, 2000, is as
follows (000):
AGGREGATE GROSS AGGREGATE GROSS
APPRECIATION DEPRECIATION NET
---------------------------------------------------------------------------
Balanced Fund $ 30,751 $ 16,987 $ 13,764
Equity Income Fund 126,856 1,401 125,455
Equity Index Fund 813,779 94,404 719,375
Large Cap Growth Fund 569,888 48,806 521,082
Large Cap Value Fund 199,569 115,014 84,555
Mid Cap Growth Fund 150,856 25,105 125,751
Mid Cap Value Fund 53,428 16,096 37,332
Small Cap Growth Fund 131,770 12,883 118,887
Small Cap Value Fund 151,507 34,921 116,586
Emerging Markets Fund 9,183 2,201 6,982
International Fund 69,940 32,706 37,234
International Index Fund 37,430 12,912 24,518
Health Sciences Fund 8,080 379 7,701
Real Estate Securities Fund 9,660 1,581 8,079
Technology Fund 183,874 63,008 120,866
---------------------------------------------------------------------------
6 > FUTURES CONTRACTS
The Equity Index Fund's investment in S&P 500 Index futures contracts and
the International Index Fund's investment in various foreign index futures
are designed to maintain sufficient liquidity to meet redemption requests
and to increase the level of fund assets devoted to replicating the
composition of the S&P 500 Index and MSCI EAFE Index respectively, while
reducing transaction costs. Risks of entering into futures contracts, in
general, include the possibility that there will not be a perfect price
correlation between the futures contracts and the underlying securities.
Second, it is possible that a lack of liquidity for futures contracts could
exist in the secondary market, resulting in an inability to close a futures
position prior to its maturity date. Third, the purchase of a futures
contract involves the risk that a fund could lose more than the original
margin deposit required to initiate a futures transaction. Unrealized gains
or losses on outstanding positions in futures contracts held at the close
of the year will be recognized as capital gains or losses for Federal
income tax purposes. At September 30, 2000, open long S&P 500 Index futures
contracts for the Equity Index Fund were as follows:
MARKET VALUE
NUMBER OF COVERED BY SETTLEMENT UNREALIZED
CONTRACTS CONTRACTS (000) MONTH GAIN (LOSS) (000)
--------------------------------------------------------------------------
1 $ 364 Dec 00 $ 2
1 363 Dec 00 --
44 15,991 Dec 00 (372)
1 364 Dec 00 (4)
1 363 Dec 00 (4)
1 363 Dec 00 (3)
--------------------------------------------------------------------------
49 $17,808 $ (381)
==========================================================================
At September 30, 2000, open long international index futures contracts for
the International Index Fund were as follows:
MARKET VALUE
COVERED BY UNREALIZED
NUMBER OF CONTRACTS SETTLEMENT GAIN (LOSS)
CONTRACT DESCRIPTION CONTRACTS (000) MONTH (000)
--------------------------------------------------------------------------
ASX Share Price Index 2 $ 90 Jan 01 $ 1
MSCO Pan-Europe Index 108 2,621 Dec 00 35
Hang Sang Stock Index 1 101 Oct 00 1
Tokyo Price Index 7 952 Dec 00 3
--------------------------------------------------------------------------
$3,784 $40
==========================================================================
(110 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
7 > SECURITIES LENDING TRANSACTIONS
In order to generate additional income, the Funds may lend portfolio
securities representing up to one-third of the value of total assets (which
includes collateral received for securities on loan) to broker dealers,
banks, or other institutional borrowers of securities. As with other
extensions of credit, there may be risks of delay in recovery of the
securities or even loss of rights in the collateral should the borrower of
the security fail financially. The market value of the securities on loan
at September 30, 2000, the collateral purchased with cash received and held
at September 30, 2000, with respect to such loans, and income generated
during the year ended September 30, 2000, from the program were as follows
(000):
MARKET VALUE OF INCOME RECEIVED
LOANED SECURITIES FROM SECURITIES LENDING
---------------------------------------------------------------------------
Balanced Fund $107,636 $116
Equity Income Fund 28,923 58
Equity Index Fund 315,068 372
Large Cap Growth Fund 370,633 400
Large Cap Value Fund 154,121 195
Mid Cap Growth Fund 202,784 317
Mid Cap Value Fund 65,744 76
Small Cap Growth Fund 78,054 537
Small Cap Value Fund 77,323 126
International Fund 42,465 39
Health Sciences Fund 7,210 10
Real Estate Securities Fund 6,865 8
Technology Fund 228,440 482
---------------------------------------------------------------------------
MARKET VALUE OF COLLATERAL PURCHASED WITH CASH RECEIVED
-------------------------------------------------------
OTHER FIXED
REPURCHASE MONEY MARKET INCOME
FUND AGREEMENTS INSTRUMENTS SECURITIES TOTAL
---------------------------------------------------------------------------
Balanced $ 73,448 $ 375 $ 37,789 $111,612
Equity Income 19,737 101 10,154 29,992
Equity Index 214,996 1,098 110,614 326,708
Large Cap
Growth 252,912 1,291 130,122 384,325
Large Cap Value 105,168 537 54,109 159,814
Mid Cap Growth 138,437 707 71,225 210,369
Mid Cap Value 44,862 229 23,081 68,172
Small Cap Growth 53,263 272 27,403 80,938
Small Cap Value 52,763 269 27,147 80,179
International -- 31,795 13,114 44,909
Health Sciences 4,920 25 2,531 7,476
Real Estate
Securities 4,685 24 2,410 7,119
Technology 155,882 796 80,201 236,879
---------------------------------------------------------------------------
U.S. Bank acts as the securities lending agent in transactions involving
the lending of portfolio securities on behalf of the funds. For these
services, U.S. Bank received $2,580,000 in aggregate securities lending
fees for the year ended September 30, 2000 for the First American Family of
Funds. Fees generated from the funds included in this annual report for
securities lending were as follows (000):
---------------------------------------------------------------------------
Balanced Fund $ 79
Equity Income Fund 39
Equity Index Fund 254
Large Cap Growth Fund 272
Large Cap Value Fund 136
Mid Cap Value 52
Mid Cap Growth Fund 216
Small Cap Growth Fund 361
Small Cap Value Fund 84
International Fund 11
Health Sciences Fund 7
Real Estate Fund 6
Technology Fund 332
---------------------------------------------------------------------------
8 > COMMON TRUST FUND CONVERSIONS
On March 17, 2000, the Santa Monica Trust Fund was converted into the Large
Cap Growth Fund. The assets, which consisted of securities and related
receivables, were converted on a tax free basis. At the time of conversion
470,882 shares of Class Y of the Large Cap Growth Fund were issued. The net
assets of the Santa Monica Trust Fund and Large Cap Growth Fund immediately
before the conversion were $10,580,732 and $1,347,748,812, respectively.
Included in the net assets of the Santa Monica Trust Fund were $6,939,805
of unrealized gains.
On July 23, 1999, the Piper Trust Common Equity Fund was converted into the
Large Cap Growth Fund. The Fund assets, which consisted of securities and
related receivables, were converted on a tax free basis. At the time of
conversion 487,250 shares of Class Y of the Large Cap Growth Fund were
issued. The net assets of the Piper Trust Common Equity Fund and Large Cap
Growth Fund immediately before the conversion were $9,808,354 and
$1,059,225,834, respectively. Included in the net assets of the Piper Trust
Common Equity Fund were $3,681,404 of unrealized gains.
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 111)
<PAGE>
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2000
9 > FUND MERGER
The Board of Directors and shareholders of Regional Equity Fund and Micro
Cap Value Fund approved a reorganization into Small Cap Value Fund at the
close of business on February 25, 2000.
Under the Agreement and Plan of Reorganization, Class A, Class B, and Class
Y shares of Regional Equity Fund and Class A and Class Y shares of Micro
Cap Value Fund were exchanged for shares of the Class A, Class B, and Class
Y shares, respectively, of the Small Cap Value Fund on a tax free basis.
The net assets before the reorganization and shares issued and redeemed
were as follows:
SHARES
NET ASSETS ISSUED
---------------------------------------------------------------------------
Small Cap Value Fund $311,587,489 9,749,924
---------------------------------------------------------------------------
Included in the net assets of the redeeming funds were the following
components:
ACCUMULATED
PAID IN REALIZED
CAPITAL LOSS
---------------------------------------------------------------------------
Regional Equity Fund $83,634,224 $(249,408)
Micro Cap Value Fund 24,838,372 --
---------------------------------------------------------------------------
NET
UNREALIZED NET SHARES
APPRECIATION ASSETS REDEEMED
---------------------------------------------------------------------------
Regional Equity Fund $26,473,410 $109,858,226 7,674,145
Micro Cap Value Fund 9,978,083 34,816,455 5,612,103
---------------------------------------------------------------------------
The Regional Equity Fund and Micro Cap Value Fund utilized earnings and
profits distributed to shareholders on redemption of shares as part of the
dividend paid deduction for income tax purposes. Accordingly $1,464,000 and
$737,000 were reclassed from undistributed net realized gain on investment
to paid in capital for Regional Equity Fund and Micro Cap Value Fund,
respectively.
10 > LINE OF CREDIT
Pursuant to a commitment letter dated September 7, 1999, Citibank, N.A.
provides a revolving line of credit to the FAIF, Inc. for short-term or
emergency purposes. The loans are for the respective benefit of and
repayable from the respective assets of each Fund. The aggregate principal
amount of all borrowings may not exceed $100,000,000, and borrowings must
be in the minimum principal amount of $1,000,000 and integral multiple
amounts of $1,000,000 for each Fund. At the Fund's option, Citibank N.A. is
paid either a base rate or the Federal Funds rate on the amount out on
loan. In addition there is a commitment fee on the unused portion of the
line of credit. The commitment fee is calculated at 0.08% basis points on
the unutilized portion of the credit line. Fees are accrued daily and paid
quarterly to Citibank N.A. There were no borrowings under the line of
credit during the year ended September 30, 2000. Effective October 11,
2000, the revolving line of credit was discontinued.
11 > FORWARD FOREIGN CURRENCY CONTRACTS
The International Fund and Emerging Markets Fund enter into forward foreign
currency exchange contracts as hedges against portfolio positions and in
connection with portfolio purchases and sales of securities denominated in
a foreign currency. Such contracts, which protect the value of the fund's
investment securities against a decline in the value of the hedged
currency, do not eliminate fluctuations in the underlying prices of the
securities. They simply establish an exchange rate at a future date.
Although such contracts tend to minimize the risk of loss due to a decline
in the value of a hedged currency, at the same time they tend to limit any
potential gain that might be realized should the value of such foreign
currency increase.
The following forward foreign currency contracts were outstanding at
September 30, 2000, for the International Fund and Emerging Markets Fund.
(112 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
<TABLE>
<CAPTION>
SETTLEMENT CONTRACTS TO IN EXCHANGE NET UNREALIZED APPRECIATION/
DATES DELIVER (000) FOR (000) (DEPRECIATION) (000)
-------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INTERNATIONAL FUND
FOREIGN CURRENCY SALES:
10/19/00 116,280 CHF $ 65,666 $ (1,722)
10/19/00 52,070 DKK 6,096 (66)
10/03/00 1,847 EUR 1,618 (12)
10/03/00 1,977 EUR 1,732 (12)
10/03/00 4,897 EUR 4,291 (31)
10/03/00 1,598 EUR 1,400 (10)
10/03/00 1,877 EUR 1,648 (8)
10/03/00 5,726 EUR 5,017 (36)
10/19/00 135,340 EUR 118,053 (1,460)
10/05/00 1,311 GBP 1,926 (13)
10/19/00 48,770 GBP 70,492 (1,620)
10/03/00 5,031 HKD 645 --
10/03/00 27,776 HKD 3,562 (1)
10/03/00 8,905 HKD 1,142 --
10/19/00 254,480 SEK 26,444 (14)
-------- --------
$309,732 $ (5,005)
FOREIGN CURRENCY PURCHASES:
10/03/00 8,318 CHF $ 5,404 $ (13)
10/03/00 2,228 CHF 1,202 (3)
10/04/00 3,038 CHF 1,764 (7)
10/19/00 50,140 CHF 28,428 630
10/19/00 66,140 CHF 38,416 (85)
10/19/00 52,070 DKK 6,203 (41)
10/02/00 3,120 EUR 2,763 (9)
10/02/00 2,383 EUR 2,109 (5)
10/03/00 1,658 EUR 1,463 (1)
10/03/00 3,545 EUR 3,133 (5)
10/04/00 14 EUR 12 --
10/04/00 1,523 EUR 1,351 (8)
10/04/00 1,237 EUR 1,092 --
10/05/00 587 EUR 519 --
10/05/00 1,311 EUR 1,160 (3)
10/06/00 1,155 EUR 1,022 (3)
10/06/00 737 EUR 652 (2)
10/19/00 135,340 EUR 121,840 (2,327)
10/05/00 1,311 GBP 1,923 15
10/06/00 666 GBP 985 --
10/19/00 23,600 GBP 33,781 1,114
10/19/00 25,170 GBP 36,935 282
10/19/00 562 GBP 824 7
10/02/00 250,722 JPY 2,337 (17)
10/02/00 7,534 SEK 783 (1)
10/03/00 15,431 SEK 1,601 1
10/19/00 54,200 SEK 5,613 22
10/19/00 95,910 SEK 9,830 141
10/19/00 104,370 SEK 11,081 (230)
-------- --------
$324,316 $ (548)
--------
$ (5,553)
========
EMERGING MARKETS FUND
FOREIGN CURRENCY SALES:
10/03/00 827 HKD $ 106 $ --
FOREIGN CURRENCY PURCHASES:
10/03/00 1,897 HKD $ 243 $ --
10/03/00 302 SGD 174 --
-------- --------
$ 417 $ --
--------
$ --
========
</TABLE>
CURRENCY LEGEND
-------------------
CHF-Swiss Francs
DKK-Danish Kroner
EUR-Euro
GBP-Great Britain Pound
HKD-Hong Kong Dollar
JPY-Japanese Yen
SGD-Singapore Dollar
SEK-Swedish Krona
FIRST AMERICAN FUNDS ANNUAL REPORT 2000 113)
<PAGE>
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2000
12 > SUBSEQUENT EVENTS
The Board of Directors of the First American Investment Funds, Inc. has
approved the reorganization of the International Index Fund into the
International Fund on October 13, 2000.
Under the proposed Agreement and Plan of Reorganization the Class A, B, and
Y shares International Index Fund will be exchanged for Class A, B, and Y
shares of the International Fund.
(114 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
(This page has been left blank intentionally.)
<PAGE>
NOTICE TO SHAREHOLDERS SEPTEMBER 30, 2000 (UNAUDITED)
THE INFORMATION SET FORTH BELOW IS FOR EACH FUND'S FISCAL YEAR AS REQUIRED
BY FEDERAL LAWS. SHAREHOLDERS, HOWEVER, MUST REPORT DISTRIBUTIONS ON A
CALENDAR YEAR BASIS FOR INCOME TAX PURPOSES, WHICH MAY INCLUDE
DISTRIBUTIONS FOR PORTIONS OF TWO FISCAL YEARS OF A FUND. ACCORDINGLY, THE
INFORMATION NEEDED BY SHAREHOLDERS FOR INCOME TAX PURPOSES WILL BE SENT TO
THEM IN EARLY 2001. PLEASE CONSULT YOUR TAX ADVISOR FOR PROPER TREATMENT OF
THIS INFORMATION.
Dear First American Shareholders:
For the fiscal year ended September 30, 2000, each Fund has designated long
term capital gains and exempt income with regard to distributions paid
during the year as follows:
<TABLE>
<CAPTION>
(A) (B)
LONG TERM ORDINARY (C)
CAPITAL GAINS INCOME TOTAL (D)
DISTRIBUTIONS DISTRIBUTIONS DISTRIBUTIONS QUALIFYING
(TAX BASIS) (TAX BASIS) (TAX BASIS) DIVIDENDS(1)
-------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Balanced Fund 72% 28% 100% 28%
Equity Income Fund 80 20 100 100
Equity Index Fund 68 32 100 99
Large Cap Growth Fund 97 3 100 85
Large Cap Value Fund 93 7 100 100
Mid Cap Growth Fund 90 10 100 --
Mid Cap Value Fund -- 100 100 94
Small Cap Growth Fund 84 16 100 9
Small Cap Value Fund 98 2 100 8
Emerging Markets Fund -- -- -- --
International Fund 100 -- 100 --
International Index Fund -- 100 100 --
Health Sciences Fund -- 100 100 14
Technology Fund 26 74 100 --
-------------------------------------------------------------------------------------------
</TABLE>
*Items (A) and (B) are based on a percentage of the fund's total
distributions.
**Item (D) is based on a percentage of ordinary income distributions of
the fund.
(1)Qualifying dividends represent dividends which qualify for the corporate
dividends received deduction.
(2)Real Estate Securities Fund is not shown due to the fact that the tax
year end is December 31st.
SHAREHOLDER VOTING RESULTS
INTERNATIONAL INDEX FUND
On October 13, 2000, International Index Fund was merged into International
Fund. Following are the shareholder voting results.
<TABLE>
<S> <C> <C> <C>
-----------------------------------------------------------------------------------------
CLASS A SHARES
For 132,197 95.15% of shares voted 55.90% of shares outstanding
Against 2,659 1.91% of shares voted 1.12% of shares outstanding
Abstain 4,074 2.93% of shares voted 1.72% of shares outstanding
CLASS B SHARES
For 34,299 95.37% of shares voted 50.54% of shares outstanding
Against 203 0.56% of shares voted 0.29% of shares outstanding
Abstain 1,460 4.06% of shares voted 2.15% of shares outstanding
CLASS C SHARES
For 6,998,386 100.00% of shares voted 87.05% of shares outstanding
Against 0 0.00% of shares voted 0.00% of shares outstanding
Abstain 0 0.00% of shares voted 0.00% of shares outstanding
-----------------------------------------------------------------------------------------
</TABLE>
(116 FIRST AMERICAN FUNDS ANNUAL REPORT 2000
<PAGE>
BOARD OF DIRECTORS FIRST AMERICAN INVESTMENT FUNDS, INC.
MR. ROBERT DAYTON
Director of First American Investment Funds, Inc.
Chief Executive Officer of Okabena Company
MR. ROGER GIBSON
Director of First American Investment Funds, Inc.
Vice President of North America-Mountain Region for United Airlines
MR. ANDREW HUNTER III
Director of First American Investment Funds, Inc.
Chairman of Hunter Keith Industries
MR. LEONARD KEDROWSKI
Director of First American Investment Funds, Inc.
Owner and President of Executive Management Consulting, Inc.
MR. JOHN MURPHY JR.
Director of First American Investment Funds, Inc.
Executive Vice President, U.S. Bancorp
MR. ROBERT SPIES
Director of First American Investment Funds, Inc.
Retired Vice President, U.S. Bank National Association
MR. JOSEPH STRAUSS
Director of First American Investment Funds, Inc.
Former Chairman of First American Investment Funds, Inc.
Owner and President of Strauss Management Company
MS. VIRGINIA STRINGER
Chairperson of First American Investment Funds, Inc.
Owner and President of Strategic Management Resources, Inc.
<PAGE>
[LOGO] FIRST AMERICAN FUNDS(R)
THE POWER OF DISCIPLINED INVESTING(R)
DIRECT FUND CORRESPONDENCE TO:
FIRST AMERICAN FUNDS
P.O. Box 1330
Minneapolis, MN 55440-1330
This report and the financial statements contained herein are submitted
for the general information of the shareholders of the corporation and
are not intended to be a forecast of future events, a guarantee of future
results, nor investment advice. Further, there is no assurance that
certain securities will remain in or out of each fundis portfolio.
For a prospectus or fund profile containing more information on First
American Funds, including investment policies, fees and expenses, please
contact your investment professional, call Investor Services at
1-800-637-2548, or visit us on the web at www.firstamericanfunds.com.
Please read the prospectus or profile carefully before you invest or send
money.
INVESTMENT ADVISOR AND ADMINISTRATOR
FIRST AMERICAN ASSET MANAGEMENT,
A DIVISION OF U.S. BANK NATIONAL ASSOCIATION
601 Second Avenue South
Minneapolis, Minnesota 55402
CUSTODIAN
U.S. BANK NATIONAL ASSOCIATION
180 East Fifth Street
St. Paul, Minnesota 55101
DISTRIBUTOR
SEI INVESTMENTS DISTRIBUTION CO.
1 Freedom Valley Drive
Oaks, Pennsylvania 19456
SEI IS NOT AN AFFILIATE OF U.S. BANK
INDEPENDENT AUDITORS
ERNST & YOUNG LLP
1400 Pillsbury Center
200 South Sixth Street
Minneapolis, Minnesota 55402
COUNSEL
DORSEY & WHITNEY LLP
220 South Sixth Street
Minneapolis, Minnesota 55402
--------------------------------------------------------------------------------
FIRST AMERICAN FUNDS Bulk Rate
c/o American Financial Printing Inc. U.S. Postage
404 Industrial Boulevard, N.E. PAID
Minneapolis, MN 55413 Mpls, MN
Permit No. 26388
In an attempt to reduce shareholder costs and help eliminate duplication, the
funds will try to limit their mailing to one report for each address that lists
one or more shareholders with the same last name. If you would like additional
copies, please call Investor Services at 1-800-637-2548.
3113-00 11/2000
AR-EQUITY-00
