GOLDMAN SACHS TRUST
N-30D, 2000-11-08

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GOLDMAN SACHS GROWTH AND INCOME FUND

Market Overview

Dear Shareholder:

During the period under review the financial markets experienced a dramatic increase in volatility. However, investors who stayed the course were generally rewarded for their disciplined approach, as many sectors of the market generated solid returns.

• Market Review: Increased Volatility and a Dramatic Correction — For the one-year reporting period that ended August 31, 2000, the U.S. stock market, as measured by the S&P 500 Index, appreciated 16.32%. However, this masked the volatile nature of the market. During the first half of the reporting period the markets rose, however the vast majority of the gains were generated by large cap growth and technology-related stocks. Then, in mid-March, the markets abruptly corrected due to continued strong economic growth, inflationary pressures and rising interest rates.

  While a range of stocks were negatively impacted by the correction, technology issues experienced the brunt of the decline. At one point the technology-heavy Nasdaq composite was down 37% from its peak. While the Nasdaq posted a one-year return of 45.93% for the period ended August 31, 2000, this was largely due to the strong performance of technology stocks late in 1999 and in the summer of 2000. However, by the end of the reporting period the Nasdaq was still off 19% from its peak. In contrast, the S&P 500 Index, which also fell during the middle of the period, recovered to the point that it was again nearing its record high by the end of August.

• Indications of Slower Economic Growth — After a series of six short-term interest rate hikes by the Federal Reserve Board (the “Fed”) to slow economic growth, the economy finally began to show signs of moderating during the summer. As such, the Fed left rates unchanged during both its June and August meetings. With the presidential election nearing, it’s now unlikely that the Fed will move to raise rates again before year-end.
• Market Outlook: More Moderate Growth — Looking ahead, we remain cautiously optimistic about the near term prospects for the U.S equity market. Reasonable growth in the U.S., stronger demand growth outside of the U.S. (particularly in Asia), and continued productivity gains would be a combination of factors that would be quite beneficial to equities. However, we do not anticipate the 20-30% gains the stock market has provided over the past several years. As such, we believe it’s important for investors to maintain realistic expectations about their investment returns, and to maintain a long-term focus for their portfolios.

  As always, we appreciate your support and we look forward to serving your investment needs in the years to come.

  Sincerely,

• David B. Ford Co-Head, Goldman Sachs Asset Management		David W. Blood Co-Head, Goldman Sachs Asset Management

  September 15, 2000

   

GOLDMAN SACHS GROWTH AND INCOME FUND

Fund Basics

as of August 31, 2000

PERFORMANCE REVIEW
August 31, 1999–August 31, 2000	Fund Total Return (without sales charge)1		S&P 500 Index2
Class A	6.48	%	16.32	%
Class B	5.70		16.32
Class C	5.67		16.32
Institutional	7.05		16.32
Service	6.40		16.32

¹ The net asset value represents the net assets of the Fund (ex-dividend) divided by the total number of shares. The Fund’s performance assumes the reinvestment of dividends and other distributions.

² The unmanaged S&P 500 Index (with dividends reinvested) figures do not reflect any fees or expenses. In addition, investors cannot invest directly in the Index.

STANDARDIZED TOTAL RETURN3
For the period ended 6/30/00	Class A		Class B		Class C		Institutional		Service
One Year	–10.96	%	–11.14	%	–7.43	%	–5.23	%	–5.83	%
Five Years	10.89		N/A		N/A		N/A		12.09	4
Since Inception	11.98		9.00		–0.88		10.46		12.80	4
	(2/5/93	)	(5/1/96	)	(8/15/97	)	(6/3/96	)	(2/5/93	)

³ The Standardized Total Returns are average annual total returns or cumulative total returns (only if the performance period is one year or less) as of the most recent calendar quarter-end. They assume reinvestment of all distributions at net asset value. These returns reflect a maximum initial sales charge of 5.5% for Class A shares, the assumed deferred sales charge for Class B shares (5% maximum declining to 0% after six years) and the assumed deferred sales charge for Class C shares (1% if redeemed within 12 months of purchase). Because Institutional and Service shares do not involve a sales charge, such a charge is not applied to their Standardized Total Returns.

⁴ Performance data for Service shares prior to 3/6/96 is that of Class A shares (excluding the impact of front-end sales charges applicable to Class A shares since Service shares are not subject to any sales charges). Performance of Class A shares of the Growth and Income Fund reflects the expenses applicable to the Fund’s Class A shares. The fees applicable to Services shares are different from those applicable to Class A shares which impact performance ratings and rankings for a class of shares.

Total return figures represent past performance and do not indicate future results, which will vary. The investment return and principal value of an investment will fluctuate and, therefore, an investor’s shares, when redeemed, may be worth more or less than their original cost. Performance reflects expense limitations in effect. In their absence, performance would be reduced.

TOP 10 HOLDINGS AS OF 8/31/ 00
Holding	% of Total Net Assets		Line of Business
General Electric Co.	4.4%		Financial Services
Intel Corp.	4.4		Semiconductors
Cisco Systems, Inc.	3.7		Computer Hardware
Pfizer, Inc.	3.0		Drugs
Citigroup, Inc.	2.9		Banks
Microsoft Corp.	2.8		Computer Software
XL Capital Ltd.	2.6		Property Insurance
International Business Machines, Inc.	2.2		Computer Software
Wal-Mart Stores	2.1		Department Stores
Exxon Mobil Corp.	2.1		Energy Resources

The top 10 holdings may not be representative of the Fund’s future investments.

GOLDMAN SACHS GROWTH AND INCOME FUND

Performance Overview

Dear Shareholder,

We are pleased to report on the performance of the Goldman Sachs Growth and Income Fund for the one year period that ended August 31, 2000.

Performance Review

Over the one-year period that ended August 31, 2000, the Fund’s Class A, B, C, Institutional and Service shares generated total cumulative returns, without sales charges, of 6.48%, 5.70%, 5.67%, 7.05%, and 6.40%, respectively. These figures compare to the 16.32% total cumulative return of the Fund’s benchmark, the S&P 500 Index.

For most of the reporting period, growth stocks significantly outperformed their value stock counterparts. During that period the largest gains were generated by a narrow band of larger-cap and technology-oriented stocks. As a result, it was a very challenging period for value-oriented funds such as Growth and Income. However, during the second half of the period value stocks generated strong results and the Fund outperformed its benchmark, the S&P 500 Index. This was especially true from March through May, as the high valuations of many growth stocks concerned investors — especially among many “new economy” companies.

On a macro level, the Fund benefited from increased merger and acquisition activity in many industries, particularly pharmaceuticals and energy resources. In addition, our exposure to the grocery and property/casualty insurance sectors, coupled with our cautious stance with regard to banks aided returns. Our investments in property/casualty insurance stocks were beneficial, and we believe that many of our companies are well-positioned to benefit from gradual improvements in industry pricing conditions. We remain underweight in bank stocks, due to our concerns about deteriorating credit quality. However, our strategy of focusing on firms with large components of fee-based income and relatively little exposure to lending activities enhanced performance.

Our value bias in the Fund led us to an underweight position in Technology stocks, which was not favorable for performance. However, several of our holdings posted solid absolute gains, including Intel Corp., Cisco Systems and Oracle Corp. However, our exposure to certain telecommunication companies, particularly Lucent Technologies and Verizon Communications detracted from results. We were underweight in this industry due to our concerns about increased competition, and subsequently reduced our holdings during the period.

Portfolio Composition

Early in the reporting period we introduced more of a quality bias into the Growth and Income Fund portfolio. Through intensive fundamental research, we believe that we can identify companies that enjoy competitive advantage in their industry sectors, yet sell at attractive valuation levels. In addition to a quality bias, we believe our portfolio composition also reflects our mandate to add value through stock selection rather than sector bets.

Portfolio Highlights

Astute use of technology has become a determinant of success across many industries. As such, our portfolios have focused on the companies in all industries that are true beneficiaries of technological innovation. In particular, we seek firms that are using information-based tools and other resources to improve their cost positions, distribution to customers, product

GOLDMAN SACHS GROWTH AND INCOME FUND

development, or raw material costs. We also believe that many “old economy” companies will prove to be rewarding investments as they use new tools to drive shareholder value, and increase their competitive advantage.

• Convergys Corp. — Convergys utilizes state-of-the art technology to provide billing services and call centers to cellular phone businesses. The company was attractively valued relative to its Internet-based competitors, and was well positioned to benefit from growing demand in the telecommunications industry. We took profits from this position during the period, as its stock price reached our targets.
• Warner Lambert/Pfizer Inc. and Union Pacific Resources/Anadarko Petroleum — Our portfolio benefited from a trend towards increased merger and acquisition activity in the large cap sector. Warner Lambert Co. and Pfizer Inc. aided results and will, we believe, position the combined company (now known as Pfizer) with the industry’s deepest pipeline and largest R&D budget. Union Pacific Resources, one of the largest independent natural gas and oil exploration and production companies, rose substantially on news that the company has agreed to be acquired by Anadarko Petroleum. Anadarko is a well-managed, cost-advantaged company that we continued to own after the merger.
• XL Capital Ltd. and American International Group, Inc. — The past several years have been a difficult environment for the insurance industry, as a flood of excess capital drove prices downward. Among property insurance stocks, XL Capital and AIG are not only attractively valued, but have some of the strongest balance sheets, cash flows and competitive positioning in the industry.

  Portfolio Outlook

  We continue to believe that the current environment offers tremendous investment opportunity for large-cap value stocks. Improved absolute returns reflect not only a renewed interest in the extended market but, more importantly, a renaissance of value investing after a lengthy hiatus. In addition, several large-cap value companies were acquired, which helped to generate interest in the sector and benefited the Growth and Income Fund. We believe merger activity should continue to be a positive catalyst for the sector, as current prices offer large corporate buyers a very favorable return on investment.

       Signs of slower U.S. economic growth suggest a decreased likelihood of tightening by the Federal Reserve Board through year end. Going forward, reasonable growth in the U.S., stronger demand growth outside of the U.S. (particularly in Asia), and a moderation in energy prices could be beneficial to many of the traditional industrial and financial companies in the Fund.

  As always, we appreciate your investment and look forward to your continued confidence.

  Goldman Sachs Value Investment Team

  New York, September 15, 2000

GOLDMAN SACHS GROWTH AND INCOME FUND

The Goldman Sachs Advantage

Founded in 1869, Goldman, Sachs & Co. is a premier financial services firm traditionally known on Wall Street and around the world for its institutional expertise.

Today, the firm’s Investment Management Division provides individual investors the opportunity to tap the resources of a global institutional powerhouse — and put this expertise to work in their individual portfolios .

What Sets Goldman Sachs Funds Apart?

Our portfolio management teams are located on-site, around the world, in New York, London, Tokyo and Singapore. Their understanding of local economies, markets, industries and cultures helps deliver what many investors want: access to global investment opportunities and consistent, risk-adjusted performance.

Our portfolio management teams make on-site visits to hundreds of companies each month, then construct selective portfolios with an emphasis on their best ideas. Our teams also have access to Goldman, Sachs & Co.’s Global Investment Research Department.

In this, our institutional heritage is clear. Institutions, as well as many individual investors, often look to us to manage the risks of global investing over time in different market environments.

To learn more about the Goldman Sachs Funds, call your investment professional today.

The following graph shows the value, as of August 31, 2000, of a $10,000 investment made on February 5, 1993 (commencement of operations) in Class A Shares (maximum sales charge of 5.5%) of the Goldman Sachs Growth and Income Fund. For comparative purposes, the performance of the Fund’s benchmark (the Standard and Poor’s 500 Index with dividends reinvested (“S& P 500 Index”)) is shown. This performance data represents past performance and should not be considered indicative of future performance which will fluctuate with changes in market conditions. These performance fluctuations will cause an investor’s shares, when redeemed, to be worth more or less than their original cost. Performance of Class B, Class C, Institutional and Service Shares will vary from Class A due to differences in fees and loads.

Growth and Income Fund’s Lifetime Performance

Growth of a $10,000 Investment, Distributions Reinvested February 5, 1993 to August 31, 2000.

Average Annual Total Return through August 31, 2000		Since Inception		Five Years		One Year
Class A (commenced February 5, 1993)
Excluding sales charges		13.12%		11.96%		6.48%
Including sales charges		12.28%		10.71%		0.61%
Class B (commenced May 1, 1996)
Excluding contingent deferred sales charges		10.04%		n/a		5.70%
Including contingent deferred sales charges		9.61%		n/a		0.42%
Class C (commenced August 15, 1997)
Excluding contingent deferred sales charges		0.42%		n/a		5.67%
Including contingent deferred sales charges		0.42%		n/a		4.61%
Institutional Class (commenced June 3, 1996)		11.05%		n/a		7.05%
Service Class (commenced March 6, 1996)		10.59%		n/a		6.40%

Shares		Description		Value
Common Stocks – 100.0%
Airlines – 0.6%
224,200		Southwest Airlines Co.		$      5,072,525
Alcohol – 0.7%
66,400		Anheuser-Busch Cos., Inc.		5,233,150
Apparel – 0.5%
90,700		Nike, Inc. Class B		3,588,319
Banks – 6.0%
78,200		Bank One Corp.		2,756,550
391,200		Citigroup, Inc.		22,836,300
12,800		J.P. Morgan & Co., Inc.		2,140,000
146,000		Mellon Financial Corp.		6,606,500
27,100		PNC Financial Services Group		1,597,206
73,800		The Bank of New York Co., Inc.		3,869,888
48,150		The Chase Manhattan Corp.		2,690,381
108,100		Wells Fargo & Co.		4,668,569
				47,165,394
Chemicals – 2.3%
143,400		E.I. du Pont de Nemours & Co.		6,435,075
92,400		Minnesota Mining & Manufacturing Co.		8,593,200
105,300		The Dow Chemicals Co.		2,757,544
				17,785,819
Clothing – 0.1%
50,300		The Gap, Inc.		1,128,606
Computer Hardware – 9.3%
24,000		Apple Computer, Inc.*		1,462,500
424,100		Cisco Systems, Inc.*		29,103,862
180,900		Compaq Computer Corp.		6,161,906
191,100		Dell Computer Corp.*		8,336,738
136,400		EMC Corp.*		13,367,200
26,800		Hewlett-Packard Co.		3,236,100
17,900		Network Appliance, Inc.*		2,094,300
73,900		Sun Microsystems, Inc.*		9,380,681
				73,143,287
Computer Software – 7.2%
133,200		International Business Machines, Inc.		17,582,400
319,100		Microsoft Corp.*		22,277,169
152,500		Oracle Corp.*		13,867,969
25,650		VERITAS Software Corp.*		3,092,428
				56,819,966
Defense/Aerospace – 0.3%
68,600		Honeywell International, Inc.		2,645,388
Department Store – 2.3%
65,600		The May Department Stores Co.		1,504,700
352,500		Wal-Mart Stores, Inc.		16,721,719
				18,226,419
Drugs – 7.8%
64,100		Amgen, Inc.*		4,859,581
131,900		Bristol-Myers Squibb Co.		6,990,700
30,600		Eli Lilly & Co.		2,233,800

Shares		Description		Value
Common Stocks – (continued)
Drugs – (continued)
103,400		Merck & Co., Inc.		$      7,225,075
551,100		Pfizer, Inc.		23,835,075
82,598		Pharmacia Corp.		4,837,146
180,800		Schering-Plough Corp.		7,254,600
64,800		SmithKline Beecham PLC ADR		4,232,250
				61,468,227
Electrical Equipment – 4.3%
9,200		Corning, Inc.		3,017,025
22,100		Corvis Corp.*		2,294,256
134,800		Lucent Technologies, Inc.		5,636,325
196,200		Motorola, Inc.		7,075,462
162,500		Nortel Networks Corp.		13,253,906
44,700		QUALCOMM, Inc.*		2,676,413
				33,953,387
Electrical Utilities – 2.4%
36,700		Duke Energy Corp.		2,745,619
142,700		Entergy Corp.		4,343,431
97,300		FPL Group, Inc.		5,193,387
345,200		Niagara Mohawk Holdings, Inc.*		4,444,450
40,800		Unicom Corp.		1,864,050
				18,590,937
Energy Resources – 5.3%
157,066		Anadarko Petroleum Corp.		10,330,231
202,136		Exxon Mobil Corp.		16,499,351
117,300		Royal Dutch Petroleum Co.		7,177,294
124,300		Unocal Corp.		4,148,512
135,900		USX-Marathon Group		3,728,756
				41,884,144
Entertainment – 3.2%
370,100		Carnival Corp.		7,378,869
175,000		The Walt Disney Co.		6,814,062
166,963		Viacom, Inc. Class B*		11,238,697
				25,431,628
Financial Services – 5.5%
166,100		Federal Home Loan Mortgage Corp.		6,996,962
589,200		General Electric Co.		34,578,675
38,000		Household International, Inc.		1,824,000
				43,399,637
Food & Beverage – 2.0%
75,800		PepsiCo., Inc.		3,230,975
102,100		The Coca-Cola Co.		5,373,013
106,700		The Quaker Oats Co.		7,248,931
				15,852,919
Forest – 1.9%
123,100		Bowater, Inc.		6,324,262
36,700		Fort James Corp.		1,160,638
225,600		International Paper Co.		7,191,000
				14,675,900

Shares		Description		Value
Common Stocks – (continued)
Grocery – 1.4%
78,700		Safeway, Inc.*		$      3,880,894
297,500		The Kroger Co.*		6,749,531
				10,630,425
Heavy Electrical – 0.2%
18,900		Emerson Electric Co.		1,250,944
Heavy Machinery – 0.7%
145,000		Crane Co.		3,643,125
63,800		Deere & Co.		2,101,413
				5,744,538
Home Products – 0.6%
72,100		The Procter & Gamble Co.		4,456,681
Industrial Parts – 2.1%
83,700		Caterpillar, Inc.		3,075,975
100,600		Parker-Hannifin Corp.		3,502,138
104,400		Tyco International Ltd.		5,950,800
57,100		United Technologies Corp.		3,565,181
				16,094,094
Information Services – 0.6%
53,900		Automatic Data Processing, Inc.		3,213,787
36,600		Electronic Data Systems Corp.		1,823,138
				5,036,925
Internet – 1.1%
132,400		America Online, Inc.*		7,761,950
5,700		Juniper Networks, Inc.*		1,218,375
				8,980,325
Life Insurance – 0.8%
112,400		AFLAC, Inc.		6,069,600
Media – 3.1%
151,000		AT&T Corp.-Liberty Media Corp.*		3,227,625
31,100		Clear Channel Communications, Inc.*		2,250,862
162,700		Comcast Corp.*		6,060,575
30,800		The News Corp. Ltd. ADR		1,620,850
128,300		Time Warner, Inc.		10,969,650
				24,129,562
Medical Products – 2.0%
75,400		Abbott Laboratories		3,298,750
49,000		Baxter International, Inc.		4,079,250
89,600		Johnson & Johnson		8,237,600
				15,615,600
Mining – 0.5%
110,600		Alcoa, Inc.		3,677,450
Oil Refining – 0.2%
36,300		Texaco, Inc.		1,869,450
Oil Services – 2.5%
33,100		Baker Hughes, Inc.		1,210,219
37,200		Diamond Offshore Drilling, Inc.		1,667,025

Shares		Description		Value
Common Stocks – (continued)
Oil Services – (continued)
123,000		Halliburton Co.		$      6,519,000
66,800		Santa Fe International Corp.		2,626,075
45,500		Schlumberger Ltd.		3,881,718
59,100		Transocean Sedco Forex, Inc.		3,531,225
				19,435,262
Property Insurance – 5.8%
164,850		American International Group, Inc.		14,692,256
114,600		The Hartford Financial Services Group, Inc.*		7,635,225
49,700		The St. Paul Cos., Inc.*		2,366,962
296,100		XL Capital Ltd.		20,412,394
				45,106,837
Railroads – 0.5%
123,900		Canadian National Railway Co.		3,647,306
Restaurants – 0.4%
104,000		McDonald’s Corp.		3,107,000
Security/Asset Management – 1.3%
94,300		Morgan Stanley Dean Witter & Co.		10,143,144
Semiconductors – 7.2%
45,100		Advanced Micro Devices, Inc.*		1,696,888
38,800		Altera Corp.*		2,478,691
20,300		Analog Devices, Inc.*		2,015,506
34,000		Applied Materials, Inc.*		2,934,625
4,700		Broadcom Corp.*		1,175,000
458,000		Intel Corp.		34,292,750
13,100		KLA-Tencor Corp.*		859,688
16,400		Novellus Systems, Inc.*		1,009,625
97,600		Texas Instruments, Inc.		6,533,100
35,700		Xilinx, Inc.*		3,172,837
				56,168,710
Specialty Retail – 1.9%
21,300		Best Buy Co., Inc.*		1,315,275
115,200		CVS Corp.		4,276,800
20,300		RadioShack Corp.		1,197,700
160,800		The Home Depot, Inc.		7,728,450
				14,518,225
Telephone – 3.8%
25,100		NEXTLINK Communications, Inc.*		880,069
107,700		Qwest Communications International, Inc.*		5,560,012
136,669		SBC Communications, Inc.		5,705,931
60,900		Sprint Corp.		2,040,150
194,176		Verizon Communications		8,470,928
191,000		WorldCom, Inc.*		6,971,500
				29,628,590
Tobacco – 0.5%
140,300		Philip Morris Cos., Inc.		4,156,388

Shares		Description		Value
Common Stocks – (continued)
Wireless – 1.1%
18,800		ALLTEL Corp.		$          950,575
106,100		Sprint Corp. (PCS Group)*		5,324,894
48,100		Vodafone Group PLC ADR		1,969,094
				8,244,563
TOTAL COMMON STOCKS
(Cost $683,919,954)				$  783,777,271

Principal Amount		Interest Rate			Maturity Date		Value
Repurchase Agreement – 0.4%
Joint Repurchase Agreement Account II Ù
$3,500,000		6.66	%		09/01/2000		$      3,500,000
TOTAL REPURCHASE AGREEMENT
(Cost $3,500,000)							$      3,500,000
TOTAL INVESTMENTS
(Cost $687,419,954)							$  787,277,271

*

Non-income producing security.

Ù

Joint repurchase agreement was entered into on August 31, 2000.

The percentage shown for each investment category reflects the value of investments in that category as a percentage of total net assets.

Investment Abbreviations:

ADR—American Depositary Receipt

Assets:
Investment in securities, at value (identified cost $687,419,954)		$787,277,271
Cash		87,480
Receivables:
Investment securities sold		8,498,022
Dividends and interest		1,066,121
Fund shares sold		219,901
Other assets		2,827
Total assets		797,151,622
Liabilities:
Payables:
Investment securities purchased		9,766,761
Fund shares repurchased		2,379,786
Amounts owed to affiliates		853,052
Accrued expenses and other liabilities		56,370
Total liabilities		13,055,969
Net Assets:
Paid-in capital		740,492,952
Accumulated net realized loss from investment, futures and options transactions		(56,254,616	)
Net unrealized gain on investments, futures and options		99,857,317
NET ASSETS		$784,095,653
Net asset value, offering and redemption price per share: (a)
Class A		$24.78
Class B		$24.42
Class C		$24.37
Institutional		$24.91
Service		$24.77
Shares outstanding:
Class A		23,257,196
Class B		6,368,469
Class C		646,203
Institutional		1,146,056
Service		319,928
Total shares outstanding, $.001 par value (unlimited number of shares authorized)		31,737,852

(a)

Maximum public offering price per share (NAV per share multiplied by 1.0582) for Class A Shares is $26.22. At redemption, Class B and Class C Shares may be subject to a contingent deferred sales charge, assessed on the amount equal to the lesser of the current net asset value or the original purchase price of the shares.

Investment income:
Dividends (a)		$12,021,226
Interest		2,070,812
Total income		14,092,038
Expenses:
Management fees		6,580,727
Distribution and Service fees (b)		3,896,151
Transfer Agent fees (c)		1,727,745
Custodian fees		145,173
Registration fees		68,745
Professional fees		60,522
Service share fees		44,543
Trustee fees		8,729
Other		124,004
Total expenses		12,656,339
Less — expense reductions		(18,726	)
Net expenses		12,637,613
NET INVESTMENT INCOME		1,454,425
Realized and unrealized gain (loss) on investment, futures and options transactions:
Net realized gain (loss) from:
Investment transactions		(60,356,960	)
Options written		572,270
Futures transactions		5,268,671
Net change in unrealized gain (loss) on:
Investments		98,915,933
Options written		(202,732	)
Futures		1,429
Net realized and unrealized gain (loss) on investment, futures and options transactions		44,198,611
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS		$45,653,036

(a)

Foreign taxes withheld on dividends were $44,796.

(b)

Class A, Class B and Class C had Distribution and Service fees of $1,705,073, $1,977,417 and $213,661, respectively.

(c)

Class A, Class B, Class C, Institutional Class and Service Class had Transfer Agent fees of $1,295,854, $375,709, $40,596, $12,023 and $3,563, respectively.

		For the Year Ended August 31, 2000			For the Seven Months Ended August 31, 1999			For the Year Ended January 31, 1999
From operations:
Net investment income		$      1,454,425			$      8,748,029			$    12,713,525
Net realized gain (loss) from investment, futures and options transactions		(54,516,019	)		74,409,026			(79,720,615	)
Net change in unrealized gain (loss) on investment, futures and options transactions		98,714,630			(52,594,995	)		(91,067,228	)
Net increase (decrease) in net assets resulting from operations		45,653,036			30,562,060			(158,074,318	)
Distributions to shareholders:
From net investment income
Class A Shares		(1,750,861	)		(5,816,651	)		(9,893,876	)
Class B Shares		(187,991	)		(690,509	)		(555,085	)
Class C Shares		(20,602	)		(77,463	)		(98,749	)
Institutional Shares		(114,748	)		(244,239	)		(2,084,974	)
Service Shares		(18,316	)		(63,039	)		(80,841	)
In excess of net investment income
Class A Shares		(865,614	)		—			(473,558	)
Class B Shares		(92,941	)		—			(26,568	)
Class C Shares		(10,186	)		—			(4,727	)
Institutional Shares		(56,731	)		—			(99,795	)
Service Shares		(9,056	)		—			(3,869	)
From net realized gains
Class A Shares		(40,865,392	)		—			—
Class B Shares		(12,294,241	)		—			—
Class C Shares		(1,338,227	)		—			—
Institutional Shares		(1,708,729	)		—			—
Service Shares		(523,645	)		—			—
Total distributions to shareholders		(59,857,280	)		(6,891,901	)		(13,322,042	)
From share transactions:
Proceeds from sales of shares		47,866,453			114,124,273			1,026,751,116
Reinvestment of dividends and distributions		56,587,452			6,538,450			10,754,319
Cost of shares repurchased		(506,756,739	)		(649,333,927	)		(761,706,430	)
Net increase (decrease) in net assets resulting from share transactions		(402,302,834	)		(528,671,204	)		275,799,005
TOTAL INCREASE (DECREASE)		(416,507,078	)		(505,001,045	)		104,402,645
Net assets:
Beginning of period		1,200,602,731			1,705,603,776			1,601,201,131
End of period		$  784,095,653			$1,200,602,731			$1,705,603,776
Accumulated undistributed (distributions in excess of) net investment income		$                  —			$          634,990			$      (1,221,249	)

1.  ORGANIZATION

Goldman Sachs Trust (the “Trust”) is a Delaware business trust registered under the Investment Company Act of 1940 (as amended) as an open-end, management investment company. The Trust includes the Goldman Sachs Growth and Income Fund (the “Fund”). The Fund is a diversified portfolio offering five classes of shares — Class A, Class B, Class C, Institutional and Service.

2.  SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of the significant accounting policies consistently followed by the Fund. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that may affect the reported amounts. Actual results could differ from those estimates. Effective for fiscal year 1999, the Board of Trustees approved a change in the fiscal year-end of the Fund from January 31 to August 31. Accordingly, the Statements of Changes in Net Assets, Summary of Share Transactions and Financial Highlights of the Fund are included for the seven months ended August 31, 1999 and the year ended January 31, 1999.

A.  Investment Valuation — Investments in securities traded on a U.S. or foreign securities exchange or the NASDAQ system are valued daily at their last sale price on the principal exchange on which they are traded. If no sale occurs, securities are valued at the last bid price. Debt securities are valued at prices supplied by independent pricing services, broker/dealer-supplied valuations or matrix pricing systems. Unlisted equity and debt securities for which market quotations are available are valued at the last sale price on valuation date, or if no sale occurs, at the last bid price. Short-term debt obligations maturing in sixty days or less are valued at amortized cost, which approximates market value. Securities for which quotations are not readily available are valued at fair value using methods approved by the Board of Trustees of the Trust.

B.  Security Transactions and Investment Income — Security transactions are recorded as of the trade date. Realized gains and losses on sales of portfolio securities are calculated using the identified-cost basis. Dividend income is recorded on the ex-dividend date, net of foreign taxes where applicable. Dividends for which the Fund has the choice to receive either cash or stock are recognized as investment income in an amount equal to the cash dividend. Interest income is recorded on the basis of interest accrued, premium amortized and discount earned.

Net investment income (other than class-specific expenses) and unrealized and realized gains or losses are allocated daily to each class of shares of the Fund based upon the relative proportion of net assets of each class.

C.  Federal Taxes — It is the Fund’s policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute each year substantially all of its investment company taxable income and capital gains to its shareholders. Accordingly, no federal tax provision is required. Income distributions, if any, are declared and paid quarterly. Capital gains distributions, if any, are declared and paid annually.

The characterization of distributions to shareholders for financial reporting purposes is determined in accordance with income tax rules. Therefore, the source of the Fund’s distributions may be shown in the accompanying financial statements as either from or in excess of net investment income or net realized gain on investment transactions, or from paid-in capital, depending on the type of book/tax differences that may exist.

The Fund had approximately $48,213,000 at August 31, 2000, (the Fund’s tax year-end) of capital loss carryforward expiring in 2008 for federal tax purposes. This amount is available to be carried forward to offset future capital gains to the extent permitted by applicable laws or regulations.

At August 31, 2000, the aggregate cost of portfolio securities for federal income tax purposes is $690,086,222. Accordingly, the gross unrealized gain on investments was $157,315,148 and the gross unrealized loss on investments was $60,124,099 resulting in a net unrealized gain of $97,191,049.

2.  SIGNIFICANT ACCOUNTING POLICIES (continued)

D.  Expenses — Expenses incurred by the Trust that do not specifically relate to an individual Fund of the Trust are allocated to the Funds on a straight-line or pro rata basis depending upon the nature of the expense.

Class A, Class B and Class C Shares bear all expenses and fees relating to their respective Distribution and Service Plans. Shareholders of Service Shares bear all expenses and fees paid to service organizations for their services with respect to such shares. Each class of shares separately bears its respective class-specific Transfer Agency fees.

E.  Foreign Currency Translations — The books and records of the Fund are maintained in U.S. dollars. Amounts denominated in foreign currencies are translated into U.S. dollars on the following basis: (i) investment valuations, foreign currency and other assets and liabilities initially expressed in foreign currencies are converted each business day into U.S. dollars based upon current exchange rates; and (ii) purchases and sales of foreign investments, income and expenses are converted into U.S. dollars based upon currency exchange rates prevailing on the respective dates of such transactions.

Net realized and unrealized gain (loss) on foreign currency transactions will represent: (i) foreign exchange gains and losses from the sale and holdings of foreign currencies; (ii) currency gains and losses between trade date and settlement date on investment securities transactions and forward exchange contracts; and (iii) gains and losses from the difference between amounts of dividends and interest recorded and the amounts actually received.

F.  Repurchase Agreements — Repurchase agreements involve the purchase of securities subject to the seller’s agreement to repurchase them at a mutually agreed upon date and price. During the term of a repurchase agreement, the value of the underlying securities, including accrued interest, is required to equal or exceed the value of the repurchase agreement. The underlying securities for all repurchase agreements are held in safekeeping at the Fund’s custodian.

G.  Segregation Transactions — The Fund may enter into certain derivative transactions to seek to increase total return. Forward foreign currency exchange contracts, futures contracts, written options, when-issued securities and forward commitments represent examples of such transactions. As a result of entering into these transactions, the Fund is required to segregate liquid assets on the accounting records equal to or greater than the market value of the corresponding transactions.

Goldman Sachs Growth and Income Fund — Tax Information (unaudited)

For the year ended August 31, 2000, 45.31% of the dividends paid from net investment company taxable income by the Growth and Income Fund qualify for the dividends received deduction available to corporations.

Pursuant to Section 852 of the Internal Revenue Code, the Fund designated $13,430,900 as capital gains dividends paid during its year ended August 31, 2000.

3.  AGREEMENTS

Pursuant to the Investment Management Agreement (the “Agreement”), Goldman Sachs Asset Management (“GSAM”), a unit of the Investment Management Division of Goldman, Sachs & Co. (“Goldman Sachs”), serves as the investment adviser to the Fund. Under the Agreement, the adviser, subject to the general supervision of the Trust’s Board of Trustees, manages the Fund’s portfolio. As compensation for the services rendered pursuant to the Agreement, the assumption of the expenses related thereto and administering the Fund’s business affairs, including providing facilities, the adviser is entitled to a fee, computed daily and payable monthly, at an annual rate equal to 0.70% of the average daily net assets of the Fund.

The investment adviser has voluntarily agreed to limit certain “Other Expenses” of the Fund (excluding Management fees, Distribution and Service fees, Transfer Agent fees, taxes, interest, brokerage commissions, litigation, Service Share fees, indemnification costs and other extraordinary expenses) to the extent such expenses exceed, on an annual basis, 0.05% of the average daily net assets of the Fund. For the year ended August 31, 2000, there was no expense reimbursement. In addition, the Fund has entered into certain offset arrangements with the custodian resulting in a reduction in the Fund’s expenses. For the year ended August 31, 2000, custody fees were reduced by approximately $19,000.

The Trust, on behalf of the Fund, has adopted Distribution and Service Plans. Under the Distribution and Service Plans, Goldman Sachs and/or authorized dealers are entitled to a monthly fee from the Fund for distribution and shareholder maintenance services equal, on an annual basis, to 0.25%, 1.00% and 1.00% of the Fund’s average daily net assets attributable to Class A, Class B and Class C Shares, respectively.

Goldman Sachs serves as the distributor of shares of the Fund pursuant to a Distribution Agreement. Goldman Sachs may receive a portion of the Class A sales load and Class B and Class C contingent deferred sales charges and has advised the Fund that it retained approximately $102,000 during the year ended August 31, 2000.

Goldman Sachs also serves as the Transfer Agent of the Fund for a fee. The fees charged for such transfer agency services are calculated daily and payable monthly at an annual rate as follows: 0.19% of the average daily net assets for Class A, Class B and Class C Shares and 0.04% of the average daily net assets for Institutional and Service Shares.

The Trust, on behalf of the Fund, has adopted a Service Plan. This plan allows for Service Shares to compensate service organizations for providing varying levels of account administration and shareholder liaison services to their customers who are beneficial owners of such shares. The Service Plan provides for compensation to the service organizations in an amount up to 0.50% (on a annualized basis), of the average daily net asset value of the Service Shares.

As of August 31, 2000, the amounts owed to affiliates were approximately $465,000, $267,000 and $121,000 for Management, Distribution and Service and Transfer Agent fees, respectively.

4.  PORTFOLIO SECURITIES TRANSACTIONS

The cost of purchases and proceeds of sales and maturities of securities (excluding short-term investments, futures and options transactions) for the year ended August 31, 2000, were $783,581,050 and $1,157,676,958, respectively. For the year ended August 31, 2000, Goldman Sachs earned approximately $95,000 of brokerage commissions from portfolio transactions, including futures transactions executed on behalf of the Fund.

Futures Contracts — The Fund may enter into futures transactions to hedge against changes in interest rates, securities prices, currency exchange rates or to seek to increase total return. Upon entering into a futures contract, the Fund is required to deposit with a broker or the Fund’s custodian bank an amount of cash or securities equal to the minimum “initial margin” requirement of the associated futures exchange. Subsequent payments for futures contracts (“variation margin”) are paid or received by the Fund daily, depending on the daily fluctuations in the value of the contracts, and are recorded for financial reporting purposes as unrealized gains or losses. When contracts are closed, the Fund realizes a gain or loss which is reported in the Statement of Operations.

4.  PORTFOLIO SECURITIES TRANSACTIONS (continued)

The use of futures contracts involve, to varying degrees, elements of market risk which may exceed the amounts recognized in the Statement of Assets and Liabilities. Changes in the value of the futures contract may not directly correlate with changes in the value of the underlying securities. This risk may decrease the effectiveness of the Fund’s hedging strategies and potentially result in a loss. At August 31, 2000, the Fund had no open futures contracts.

Option Accounting Principles — When the Fund writes call or put options, an amount equal to the premium received is recorded as an asset and as an equivalent liability. The amount of the liability is subsequently marked-to-market to reflect the current market value of the option written. When a written option expires on its stipulated expiration date or the Fund enters into a closing purchase transaction, the Fund realizes a gain or loss without regard to any unrealized gain or loss on the underlying security, and the liability related to such option is extinguished. When a written call option is exercised, the Fund realizes a gain or loss from the sale of the underlying security, and the proceeds of the sale are increased by the premium originally received. When a written put option is exercised, the amount of the premium originally received will reduce the cost of the security which the Fund purchases upon exercise. There is a risk of loss from a change in value of such options which may exceed the related premiums received.

Upon the purchase of a call option or a protective put option by the Fund, the premium paid is recorded as an investment and subsequently marked-to-market to reflect the current market value of the option. If an option which the Fund has purchased expires on the stipulated expiration date, the Fund will realize a loss in the amount of the cost of the option. If the Fund enters into a closing sale transaction, the Fund will realize a gain or loss, depending on whether the sale proceeds for the closing sale transaction are greater or less than the cost of the option. If the Fund exercises a purchased put option, the Fund will realize a gain or loss from the sale of the underlying security, and the proceeds from such sale will be decreased by the premium originally paid. If the Fund exercises a purchased call option, the cost of the security which the Fund purchases upon exercise will be increased by the premium originally paid. At August 31, 2000, there were no open written option contracts.

For the year ended August 31, 2000, written call option transactions in the Fund were as follows:

Written Options		Number of Contracts			Premium Received
Balance outstanding, beginning of year		2,795			$  572,270
Options assigned		(1,442	)		(217,937	)
Options expired		(1,353	)		(354,333	)
Balance outstanding, end of year		—			$          —

5.  LINE OF CREDIT FACILITY

Effective May 31, 2000, the Fund participates in a $350,000,000 committed, unsecured revolving line of credit facility. Prior thereto, the Fund participated in a $250,000,000 uncommitted and a $250,000,000 committed unsecured revolving line of credit facility. Under the most restrictive arrangement the Fund must own securities having a market value in excess of 400% of the total bank borrowings. This facility is to be used solely for temporary or emergency purposes. The interest rate on borrowings is based on the Federal Funds rate. The committed facility also requires a fee to be paid by the Fund based on the amount of the commitment. During the year ended August 31, 2000, the Fund did not have any borrowings under any of these facilities.

6.  JOINT REPURCHASE AGREEMENT ACCOUNT

The Fund, together with other registered investment companies having management agreements with GSAM or its affiliates, transfers uninvested cash into joint accounts, the daily aggregate balance of which is invested in one or more repurchase agreements.

At August 31, 2000, the Fund had an undivided interest in the repurchase agreements in the joint account which equaled $3,500,000 in principal amount. At August 31, 2000, the following repurchase agreements held in this joint account were fully collateralized by Federal Agency obligations:

Repurchase Agreements		Principal Amount		Interest Rate			Maturity Date		Amortized Cost		Maturity Value
ABN/AMRO, Inc.		$  814,100,000		6.66	%		09/01/2000		$  814,100,000		$  814,250,608
Banc of America Securities LLC		900,000,000		6.67			09/01/2000		900,000,000		900,166,750
Barclays Capital, Inc.		500,000,000		6.67			09/01/2000		500,000,000		500,092,639
Bear Stearns Companies, Inc.		300,000,000		6.67			09/01/2000		300,000,000		300,055,583
Chase Securities, Inc.		450,000,000		6.67			09/01/2000		450,000,000		450,083,375
Donaldson, Lufkin & Jenrette, Inc.		1,000,000,000		6.67			09/01/2000		1,000,000,000		1,000,185,278
J.P. Morgan & Co., Inc.		800,000,000		6.65			09/01/2000		800,000,000		800,147,778
Morgan Stanley Dean Witter & Co.		750,000,000		6.65			09/01/2000		750,000,000		750,138,542
Morgan Stanley Dean Witter & Co.		300,000,000		6.60			09/01/2000		300,000,000		300,055,000
UBS Warburg LLC		800,000,000		6.65			09/01/2000		800,000,000		800,147,778
TOTAL JOINT REPURCHASE AGREEMENT ACCOUNT II									$6,614,100,000		$6,615,323,331

7.  CHANGE IN INDEPENDENT ACCOUNTANTS

On October 26, 1999, the Board of Trustees of the Fund, upon the recommendation of the Board’s audit committee, determined not to retain Arthur Andersen LLP and approved a change of the Fund’s independent accountants to PricewaterhouseCoopers LLP. For the period ended August 31, 1999 and the year ended January 31, 1999, Arthur Andersen LLP’s audit reports contained no adverse opinion or disclaimer of opinion; nor were their reports qualified or modified as to uncertainty, audit scope, or account principles. Further, there were no disagreements between the Fund and Arthur Andersen LLP on accounting principles or practices, financial statement disclosure or audit scope or procedure, which if not resolved to the satisfaction of Arthur Andersen LLP would have caused them to make reference to the disagreement in their reports.

8.  CERTAIN RECLASSIFICATIONS

In accordance with AICPA Statement of Position 93-2, the Fund reclassified $1,040,735 from accumulated distributions in excess of net investment income to paid-in capital and $3,104 from undistributed net investment income to accumulated net realized loss from investment, futures and options transactions. These reclassifications have no impact on the net asset value of the Fund and are designed to present the Fund’s capital accounts on a tax basis. Reclassifications result primarily from the difference in the tax treatment of foreign currency, net operating losses and organization costs.

9.  SUMMARY OF SHARE TRANSACTIONS

Share activity is as follows:

		For the Year Ended August 31, 2000						For the Seven Months Ended August 31, 1999						For the Year Ended January 31, 1999
		Shares			Dollars			Shares			Dollars			Shares			Dollars
Class A Shares
Shares sold		1,336,043			$  31,836,651			2,693,500			$  68,994,627			19,137,910			$508,921,386
Reinvestments of dividends and distributions		1,808,369			42,287,423			222,190			5,612,552			390,593			9,715,068
Shares repurchased		(14,540,480	)		(344,395,625	)		(14,386,320	)		(361,520,290	)		(20,323,258	)		(510,471,024	)
		(11,396,068	)		(270,271,551	)		(11,470,630	)		(286,913,111	)		(794,755	)		8,165,430
Class B Shares
Shares sold		354,447			8,333,880			532,909			13,448,149			7,059,564			191,017,805
Reinvestments of dividends and distributions		467,551			10,834,187			23,841			604,660			21,979			509,810
Shares repurchased		(5,569,557	)		(130,534,853	)		(3,930,139	)		(97,151,929	)		(4,555,733	)		(111,930,613	)
		(4,747,559	)		(111,366,786	)		(3,373,389	)		(83,099,120	)		2,525,810			79,597,002
Class C Shares
Shares sold		82,360			1,922,744			104,662			2,636,497			1,937,045			52,029,313
Reinvestments of dividends and distributions		51,899			1,200,022			2,859			72,208			4,364			105,648
Shares repurchased		(771,431	)		(18,113,626	)		(823,868	)		(20,529,279	)		(1,174,701	)		(28,489,276	)
		(637,172	)		(14,990,860	)		(716,347	)		(17,820,574	)		766,708			23,645,685
Institutional Shares
Shares sold		181,437			4,379,832			1,012,105			26,839,595			10,119,858			268,940,951
Reinvestments of dividends and distributions		74,291			1,738,712			7,373			189,388			14,004			346,705
Shares repurchased		(411,654	)		(9,765,648	)		(6,850,928	)		(165,722,925	)		(4,396,583	)		(108,988,620	)
		(155,926	)		(3,647,104	)		(5,831,450	)		(138,693,942	)		5,737,279			160,299,036
Service Shares
Shares sold		58,518			1,393,346			85,566			2,205,405			218,320			5,841,661
Reinvestments of dividends and distributions		22,542			527,108			2,354			59,642			3,132			77,088
Shares repurchased		(166,719	)		(3,946,987	)		(173,088	)		(4,409,504	)		(73,792	)		(1,826,897	)
		(85,659	)		(2,026,533	)		(85,168	)		(2,144,457	)		147,660			4,091,852
NET INCREASE (DECREASE)		(17,022,384	)		$(402,302,834	)		(21,476,984	)		$(528,671,204	)		8,382,702			$275,799,005

				Income from investment operations									Distributions to shareholders
		Net asset value, beginning of period		Net investment income (loss)			Net realized and unrealized gain (loss)			Total from investment operations			From net investment income			In excess of net investment income			From net realized gains
FOR THE YEAR ENDED AUGUST 31,
2000 - Class A Shares		$24.68		$  0.07	(c)		$1.44			$1.51			$(0.05	)		$(0.03	)		$(1.33	)
2000 - Class B Shares		24.46		(0.10	) (c)		1.42			1.32			(0.02	)		(0.01	)		(1.33	)
2000 - Class C Shares		24.41		(0.09	) (c)		1.40			1.31			(0.01	)		(0.01	)		(1.33	)
2000 - Institutional Shares		24.72		0.16	(c)		1.49			1.65			(0.09	)		(0.04	)		(1.33	)
2000 - Service Shares		24.68		0.05	(c)		1.44			1.49			(0.05	)		(0.02	)		(1.33	)
FOR THE SEVEN MONTHS ENDED AUGUST 31,
1999 - Class A Shares		24.33		0.19			0.31			0.50			(0.15	)		—			—
1999 - Class B Shares		24.13		0.08			0.31			0.39			(0.06	)		—			—
1999 - Class C Shares		24.08		0.08			0.30			0.38			(0.05	)		—			—
1999 - Institutional Shares		24.35		0.34			0.23			0.57			(0.20	)		—			—
1999 - Service Shares		24.33		0.17			0.32			0.49			(0.14	)		—			—
FOR THE YEARS ENDED JANUARY 31,
1999 - Class A Shares		25.93		0.20			(1.60	)		(1.40	)		(0.19	)		(0.01	)		—
1999 - Class B Shares		25.73		0.02			(1.58	)		(1.56	)		(0.04	)		—			—
1999 - Class C Shares		25.70		0.02			(1.59	)		(1.57	)		(0.05	)		—			—
1999 - Institutional Shares		25.95		0.29			(1.58	)		(1.29	)		(0.30	)		(0.01	)		—
1999 - Service Shares		25.92		0.17			(1.58	)		(1.41	)		(0.17	)		(0.01	)		—
1998 - Class A Shares		23.18		0.11			5.27			5.38			(0.11	)		—			(2.52	)
1998 - Class B Shares		23.10		0.04			5.14			5.18			—			(0.03	)		(2.52	)
1998 - Class C Shares (commenced August 15, 1997)		28.20		(0.01	)		0.06			0.05			—			(0.03	)		(2.52	)
1998 - Institutional Shares		23.19		0.27			5.23			5.50			(0.22	)		—			(2.52	)
1998 - Service Shares		23.17		0.14			5.23			5.37			(0.06	)		(0.04	)		(2.52	)
1997 - Class A Shares		19.98		0.35			5.18			5.53			(0.35	)		(0.01	)		(1.97	)
1997 - Class B Shares (commenced May 1, 1996)		20.82		0.17			4.31			4.48			(0.17	)		(0.06	)		(1.97	)
1997 - Institutional Shares (commenced June 3, 1996)		21.25		0.29			3.96			4.25			(0.30	)		(0.04	)		(1.97	)
1997 - Service Shares (commenced March 6, 1996)		20.71		0.28			4.50			4.78			(0.28	)		(0.07	)		(1.97	)
1996 - Class A Shares		15.80		0.33			4.75			5.08			(0.30	)		—			(0.60	)

(a)

Assumes investment at the net asset value at the beginning of the period, reinvestment of all dividends and distributions, a complete redemption of the investment at the net asset value at the end of the period and no sales or redemption charges. Total return would be reduced if a sales or redemption charge were taken into account. Total returns for periods less than one full year are not annualized.

(b)

Annualized.

(c)

Calculated based on the average shares outstanding methodology.

																Ratios assuming no expense reductions
Total distributions			Net asset value, end of period		Total return (a)			Net assets at end of period (in 000s)		Ratio of net expenses to average net assets			Ratio of net investment income (loss) to average net assets			Ratio of expenses to average net assets			Ratio of net investment income (loss) to average net assets			Portfolio turnover rate
$(1.41	)		$24.78		6.48	%		$    576,354		1.18	%		0.31	%		1.18	%		0.31	%		86.84	%
(1.36	)		24.42		5.70			155,527		1.93			(0.41	)		1.93			(0.41	)		86.84
(1.35	)		24.37		5.67			15,746		1.93			(0.40	)		1.93			(0.40	)		86.84
(1.46	)		24.91		7.05			28,543		0.78			0.69			0.78			0.69			86.84
(1.40	)		24.77		6.40			7,926		1.28			0.20			1.28			0.20			86.84
(0.15	)		24.68		2.05			855,174		1.19	(b)		1.26	(b)		1.20	(b)		1.25	(b)		55.43
(0.06	)		24.46		1.60			271,912		1.94	(b)		0.51	(b)		1.95	(b)		0.50	(b)		55.43
(0.05	)		24.41		1.58			31,328		1.94	(b)		0.51	(b)		1.95	(b)		0.50	(b)		55.43
(0.20	)		24.72		2.32			32,181		0.79	(b)		1.72	(b)		0.80	(b)		1.71	(b)		55.43
(0.14	)		24.68		2.01			10,008		1.29	(b)		1.16	(b)		1.30	(b)		1.15	(b)		55.43
(0.20	)		24.33		(5.40	)		1,122,157		1.22			0.78			1.32			0.68			125.79
(0.04	)		24.13		(6.07	)		349,662		1.92			0.09			1.92			0.09			125.79
(0.05	)		24.08		(6.12	)		48,146		1.92			0.10			1.92			0.10			125.79
(0.31	)		24.35		(5.00	)		173,696		0.80			1.25			0.80			1.25			125.79
(0.18	)		24.33		(5.44	)		11,943		1.30			0.72			1.30			0.72			125.79
(2.63	)		25.93		23.71			1,216,582		1.25			0.43			1.42			0.26			61.95
(2.55	)		25.73		22.87			307,815		1.94			(0.35	)		1.94			(0.35	)		61.95
(2.55	)		25.70		0.51			31,686		1.99	(b)		(0.48	) (b)		1.99	(b)		(0.48	) (b)		61.95
(2.74	)		25.95		24.24			36,225		0.83			0.76			0.83			0.76			61.95
(2.62	)		25.92		23.63			8,893		1.32			0.32			1.32			0.32			61.95
(2.33	)		23.18		28.42			615,103		1.22			1.60			1.43			1.39			53.03
(2.20	)		23.10		22.23			17,346		1.93	(b)		0.15	(b)		1.93	(b)		0.15	(b)		53.03
(2.31	)		23.19		20.77			193		0.82	(b)		1.36	(b)		0.82	(b)		1.36	(b)		53.03
(2.32	)		23.17		23.87			3,174		1.32	(b)		0.94	(b)		1.32	(b)		0.94	(b)		53.03
(0.90	)		19.98		32.45			436,757		1.20			1.67			1.45			1.42			57.93

To the Shareholders and Board of Trustees of Goldman Sachs Trust—Growth and Income Fund:

In our opinion, the accompanying statement of assets and liabilities, including the statement of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of Goldman Sachs Growth and Income Fund (“the Fund”), one of the portfolios constituting Goldman Sachs Trust, at August 31, 2000, the results of its operations, the changes in its net assets and the financial highlights for the year then ended, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as “financial statements”) are the responsibility of the Fund’s management; our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit of these financial statements in accordance with auditing standards generally accepted in the United States of America, which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audit, which included confirmation of securities at August 31, 2000 by correspondence with the custodian and brokers, provides a reasonable basis for our opinion. The statements of changes in net assets of the Fund for the period ended August 31, 1999 and the year ended January 31, 1999 and the financial highlights for each of the periods ended on or before August 31, 1999 were audited by other independent accountants whose report dated October 8, 1999 expressed an unqualified opinion thereon.

PricewaterhouseCoopers LLP

Boston, Massachusetts

October 23, 2000

GOLDMAN SACHS FUND PROFILE

Goldman Sachs Growth and Income Fund

An Investment Idea for the Long Term

Historically, stocks have demonstrated greater potential to build wealth over the long term than most other types of investments.

Goldman Sachs Growth and Income Fund provides investors access to the benefits associated with equity investing. The Fund seeks long-term capital growth and growth of income, primarily through equity securities that, in management’s view, offer favorable capital appreciation and/or dividend-paying ability.

Target Your Needs

The Goldman Sachs Growth and Income Fund has a distinct investment objective and a defined place on the risk/return spectrum. As your investment objectives change, you can exchange shares within the Goldman Sachs Funds family without an additional charge.* (Please note: in general, greater returns are associated with greater risk.)

For More Information

To learn more about the Goldman Sachs Growth and Income Fund and other Goldman Sachs Funds, call your investment professional today.

*The exchange privilege is subject to termination and its terms are subject to change.