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Atlas Funds
Semi-Annual Report
June 30, 1998
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[ATLAS FUNDS LOGO]
ATLAS FUNDS(R)
The investments you want from the people you trust.
<PAGE>
Table of Contents
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Letter from the President .............................................. 2
Atlas Stock and Bond Fund Total Returns ............................... 5
Statements of Investments in Securities and Net Assets ................ 6
Statements of Assets and Liabilities .................................. 34
Statements of Operations .............................................. 36
Statements of Changes in Net Assets .................................. 38
Financial Highlights ................................................. 42
Notes to Financial Statements ........................................ 52
<PAGE>
[ATLAS ANNUITIES LOGO]
ATLAS ANNUITIES(R)
From the office of Marion O. Sandler
President and Chief Executive Officer
Dear Valued Shareholder,
We are pleased to report that during the first half of 1998 all of
our funds provided solid returns, which are attributable, in part,
to continued strength in the stock and bond markets.
In general, the U.S. economy remained robust. The unemployment
rate stayed low, closing the second quarter at 4.5%. Consumer
confidence rose, and retail sales and personal consumption continued
to be strong. Sales of new and existing homes also increased, due
largely to a 30-year fixed mortgage rate that approached a low 7%.
The inflationary pressures created by a strong economy eased
during the second quarter, as the rate of economic growth decreased
and corporate earnings slowed. This slowdown translated into good
news for the stock market, because it allowed the Federal Reserve to
remain on the sidelines, with no increases in interest rates. For
the first six months of the year, the Consumer Price Index, one
measure of inflation, rose at an annualized rate of only 1.4%.
The Markets In Review, Year to Date
The overall economic environment contributed to the stock market's
continuing climb, though the market did experience its ups and
downs. On May 13th, the Dow Jones Industrial Average (DJIA) closed
above 9200 for the first time ever and, although it fell back
somewhat by June 30th, ended the first half of the year with a gain
of 13.2%.
Throughout the first six months of 1998, blue chip and other large
capitalization stocks outperformed medium sized and small companies.
Investors, responding to a slowing in earnings growth, directed more
money into the relative safety and predictability of larger
businesses, which usually perform better in a weaker economy.
In the bond market, money poured into U.S. Treasuries as American
investors anticipated falling interest rates and foreign buyers
sought a safe harbor from the turmoil in international markets. With
increased demand driving prices up, the yield on the benchmark
30-year Treasury bond reached a record low of 5.58% on June 15th.
The following sections provide an overview of the Atlas Funds for
the first half of 1998. The total returns discussed below are for
Class A shares (for complete performance information, please see
page 5). Of course, past performance is no guarantee of future
results, but the funds' track records are certainly worth noting.
Stock Funds
The Growth and Income Fund rewarded investors with a 15.52% total
return in the first half of the year, outdistancing the Lipper
average return for growth and income funds of 12.12%. For the 12
months ended June 30th, total return was 29.93%, ranking the fund in
the top 12% of its peer group.(1) Recent strong performance can be
attributed to the manager's ability to identify companies with
sustainable revenue and earnings growth in a slowing economy.
Investments in consumer cyclicals, selected technology sectors, and
financial stocks contributed to the impressive returns. As of June
30th, the portfolio contained 82% stocks, 8% convertible securities,
5% bonds, and 5% cash.
2
<PAGE>
The Global Growth Fund achieved a 14.74% gain for the first half
of the year, outperforming the Lipper average return for global
funds of 14.06%. The total return for the 12 months ended June 30,
1998 was 21.03%, placing Atlas in the top 23% of global funds.(2)
The fund's performance in 1998 was assisted by several factors: 1) a
low exposure to Japan and other Asian countries, 2) good performance
from several of its largest holdings in Europe, and 3) a meaningful
investment in U.S. zero-coupon Treasuries. At the end of the second
quarter, the countries where the fund maintained the largest
positions were the U.S. (25%), Great Britain (15%), France (12%),
Germany (8%), and Italy (4%).
The Strategic Growth Fund outperformed the Dow Jones Industrial
Average with a first half total return of 13.88%, despite the fact
that cash averaged more than 22% of the fund's portfolio, well above
the average for other growth funds. Performance was helped by
holdings in consumer cyclicals and consumer finance stocks. The
fund's manager anticipates that U.S. corporate earnings will slow
further over the near term. As a result, he expects to maintain a
defensive posture and an above-average cash position until
opportunities become available to buy stocks at better price levels.
The Emerging Growth Fund had a total return of 8.54% in the first
six months of the year, significantly outperforming the Lipper
average for small company funds of 6.46%. As a category, small
company stocks closed the first half well behind the large company
averages, and many analysts believe that the relative
underperformance of emerging companies has begun to create
attractive investment opportunities in this sector. The stocks which
contributed most positively to performance during the first half
were in technology, healthcare, and consumer products. On June 30th,
the fund was invested 85% in stocks and 15% in cash, a
higher-than-average cash level for small company funds. The manager
believes it prudent to hold some reserves in anticipation of better
opportunities.
The Balanced Fund generated a total return of 7.80% in the first
half. The total return for the 12 months ended June 30, 1998 was
21.19%, placing it in the top 20% of all balanced funds.(3) As our
most conservative stock fund, it continues to maintain a defensive
investment strategy, resulting in a large cash position and a focus
on high dividend paying equities. As of June 30th, the fund's
holdings were 35% in common stocks, 26% in bonds, 14% in convertible
securities, and 25% in cash. Stock groups that contributed to the
fund's 1998 performance were banks, as well as drug, retail, and
insurance company stocks.
Bond Funds
The Strategic Income Fund produced a total return of 3.34% in the
first six months of the year, which exceeded the Lipper average
return for multi-sector income funds of 2.71%. For the 12 months
ended June 30th, a total return of 8.67% placed the fund in the top
22% of its peers.(4) The fund's 1998 performance is attributed to a
rally in the Treasury bond market, as well as to large investments
in high yield and European securities. Throughout the first six
months of the year, the fund remained underweighted in bonds from
Asian and Latin American countries, which continued to experience
currency instability and slow growth. At the end of the first half,
the fund was invested 46% in U.S. Government securities, 29% in high
yield U.S. corporates, 19% in foreign fixed income debt, and 6% in
cash.
The U.S. Government and Mortgage Securities Fund generated a total
return of 2.99% during the first half of the year, as
mortgage-backed securities operated within a very challenging
investment environment. The lowest long-term interest rates that our
economy has experienced in a generation spurred a significant level
of mortgage refinancings, forcing the manager to replace older,
higher coupon securities with current market issues at lower yields.
Nonetheless, the Atlas U.S. Government and Mortgage Securities Fund
continues to offer a portfolio that contains only AAA rated
investments, with a 30-day yield on June 30th of 6.28% that is among
the highest in its peer group. In fact, the fund has ranked in the
top 15% of U.S. Government funds for yield in every month for the
past five years.(5)
The California Municipal Bond Fund produced a first half total
return of 2.45%, exceeding the Lipper average return for California
municipal debt funds of 2.28%. In order to generate higher yields
and total returns, the manager began a program of extending
maturities, which had been shorter than comparable municipal funds,
to a level that is closer to the peer group average, and has also
been selectively investing in A and BBB rated securities. However,
the fund continues to hold one of the highest quality portfolios in
its class, with 92% of its assets invested in bonds rated AAA and
AA, ranking it in the top 2% of its peers for credit quality.(6)
(continued on next page)
3
<PAGE>
The National Municipal Bond Fund experienced an above average
2.45% total return for the first half of the year. Similar to the
California Municipal Bond Fund, the manager sought to increase
yields and total returns by lengthening maturities, previously
shorter than average for comparable municipal funds, and selectively
investing in A and BBB investment grade securities. Even so, the
fund continues to hold one of the highest quality portfolios of its
type, with 78% of its assets invested in bonds with AAA and AA
credit ratings, placing it in the top 18% of general municipal debt
funds for credit quality.(6)
Money Funds
For the first half of the year, the Atlas money funds - U.S.
Treasury Money, National Municipal Money, and California Municipal
Money - have provided investors with attractive after-tax yields and
investment stability. As always, our money funds, unlike many of
their peers, hold only top quality securities. Additionally, our
municipal money funds have continued to avoid securities backed by
Japanese letters of credit (LOCs). Because of Japan's weak economy
and the pressure it has placed on the country's banks, issues backed
by Japanese LOCs still do not meet the stringent quality standards
that we have imposed on our money market portfolios.
The Atlas Advantage
When you invest in any Atlas Fund, you don't have to pay one cent
in sales charges.(7) And as an added benefit, your Atlas no load
mutual funds come with the knowledge and expertise of a friendly
Atlas Representative. Instead of doing business with some cold,
impersonal voice over the phone, you'll meet with your Atlas
Representative, person-to-person, in the comfort of a nearby branch
of our sister company - World Savings. Atlas offers you the kind of
personal attention and professional advice that most no load funds
simply do not provide.
The Investments You Want From the People You Trust
As a sister company of World Savings and a member of the $40
billion-strong Golden West Financial Corporation, Atlas is dedicated
to giving you the quality products, personal service and caring
professional advice you've come to expect from World. Your Atlas
Representative will be happy to answer any questions you have about
your funds, provide you with more information about Atlas annuities,
or prepare a complimentary review of your investment portfolio. For
an appointment, simply call 1-800-933-ATLAS (1-800-933-2852). We
appreciate the trust you've placed in Atlas, and we look forward to
serving you for many years to come.
Sincerely,
/s/ Marion O. Sandler
(Mrs.) Marion O. Sandler
President and Chief Executive Officer
(1) Lipper Analytical Services, Inc. ranked the Growth and Income
Fund 77 out of 669 for total return for one year, and 142 out of
275 for five years ended 6/30/98 for the Growth and Income Fund
category.
(2) Lipper Analytical Services, Inc. ranked the Global Growth Fund
42 out of 189 for total return for the one year period ended
6/30/98 for the Global Fund category.
(3) Lipper Analytical Services, Inc. ranked the Balanced Fund 73 out
of 373 for total return for the one year period ended 6/30/98
for the Balanced Fund category.
(4) Lipper Analytical Services, Inc. ranked the Strategic Income
Fund 18 out of 83 for total return for one year ended 6/30/98
for the Multi-Sector Income Fund category.
(5) Lipper Analytical Services, Inc. ranked the U.S. Government and
Mortgage Securities Fund 176 out of 181 for total return for one
year and 46 out of 96 for five years ended 6/30/98 for the
General U.S. Government Fund category. The source for yield
rankings is the Lipper Mutual Fund Yield Survey, June 30, 1998.
(6) Source: Lipper - Portfolio Analysis Report on Fixed Income Funds
(Tax-Exempt), March 31, 1998.
(7) No load pricing applies to Class A shares.
4
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<TABLE>
Atlas Stock and Bond Fund Total Returns for periods ended June 30, 1998
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<CAPTION>
Class A Shares Class B Shares
----------------------------------------- -------------------------------------------------------
12 Months 5 Years Inception To Date 12 Months Inception To Date
----------- --------- ------------------- --------------------- ---------------------------------
at at at inception without with without with inception
net net net date deferred deferred deferred deferred date
asset asset asset sales sales sales sales
value value value charge charge* charge charge*
% % % % % % %
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------
Stock Funds:
Emerging Growth_______________ 13.42 N.A. 34.31 4/97 12.64 9.64 33.33 30.88 4/97
Global Growth_________________ 21.03 N.A. 23.58 4/96 20.40 17.40 22.81 22.08 4/96
Strategic Growth______________ 23.96 N.A. 19.67 10/93 23.12 20.12 23.04 22.77 7/94
Growth and Income_____________ 29.93 19.24 18.38 12/90 29.48 26.48 24.63 24.37 7/94
Balanced______________________ 21.19 N.A. 14.39 10/93 20.52 17.52 17.51 17.21 7/94
Bond Funds:
Strategic Income______________ 8.67 N.A. 10.41 5/96 7.86 4.87 9.53 8.67 5/96
U.S. Government
and Mortgage
Securities____________________ 7.58 5.81 8.06 1/90 7.05 4.05 7.51 7.10 7/94
California
Municipal Bond________________ 7.97 5.44 7.71 1/90 7.34 4.34 6.24 5.82 7/94
National
Municipal Bond________________ 8.13 5.60 7.90 1/90 7.50 4.50 6.52 6.10 7/94
<FN>
* Assumes complete redemption at the end of the given period and imposition of the maximum Contingent Deferred Sales
Charge
</FN>
5
</TABLE>
<PAGE>
Statements of Investments in Securities and Net Assets
June 30, 1998 (unaudited)
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Atlas U.S. Treasury Money Fund
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value
face amount (note 1)
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United States Treasury Bills - 1.30%
4.95% due 10/08/98 ...................... $ 755,000 $ 744,723
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Total United States Treasury Bills (cost: $744,723) 744,723
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United States Treasury Notes - 98.79%
4.75% due 08/31/98 - 10/31/98 ........... 19,135,000 19,384,884
5.50% - 5.88% due 08/15/98 - 11/15/98 ... 19,045,000 19,238,642
6.00% - 6.13% due 08/31/98 - 09/30/98 ... 13,215,000 13,445,751
8.25% - 8.88% due 07/15/98 - 11/15/98 ... 4,170,000 4,325,955
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Total United States Treasury Notes (cost: $56,395,232) 56,395,232
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Total Securities (cost: $57,139,955) - 100.09% 57,139,955
Other Assets and Liabilities, Net - (0.09)% (52,151)
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Net Assets - 100.00% $ 57,087,804
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Atlas California Municipal Money Fund
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value
face amount (note 1)
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Tax-Exempt Commercial Paper - 6.01%
Los Angeles, Metro Transportation
Authority, 3.40% due 08/06/98 .......... $ 1,000,000 $ 1,000,000
Sacramento, Municipal Utility District,
Series I, 3.35% due 09/09/98 ........... 1,500,000 1,500,000
------------
Total Tax-Exempt Commercial Paper (cost: $2,500,000) 2,500,000
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Fixed Rate Bonds and Notes - 23.11%
Alameda County, Unified School District,
Tax and Revenue Anticipation Notes,
4% due 06/30/99 ........................ 2,000,000 2,005,760
Anaheim, Electrical Revenue,
4.50% due 10/01/98 ..................... 250,000 250,612
California State, General Obligation,
4% due 09/01/98 ........................ 100,000 100,025
Conejo Valley, Unified School District,
Tax and Revenue Anticipation Notes,
4.25% due 07/02/98 ..................... 1,000,000 1,000,000
Contra Costa Water District Revenue,
Series B, 7.625% due 10/01/98 ......... 1,000,000 1,029,373
Glendale Redevelopment Agency, Tax
Allocation Revenue, AMBAC Insured,
7.10% due 12/01/98 ..................... 1,385,000 1,431,175
Industry, FGIC Insured, 7% due 07/01/98 100,000 100,000
Los Angeles, Unified School District,
Tax and Revenue Anticipation Notes,
4.50% due 07/01/98 ..................... 1,000,000 1,000,000
Monterey County, COP, Natividad Medical
Center Improvement, Series E, MBIA
Insured, 4% due 08/01/98 ............... 245,000 245,061
Moreland, School District Refunding,
FSA Insured, 9% due 09/01/98 ........... 200,000 201,742
Atlas California Municipal Money Fund (continued)
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value
face amount (note 1)
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Northern California Power Agency
Public Power Revenue Refunding,
Hydroelectric Project 1, Series B,
8% due 07/01/98 .......................... $ 200,000 $ 200,000
Sacramento, Municipal Utility District
Electric Revenue, Series I, MBIA Insured,
4.90% due 01/01/99 ....................... 250,000 251,593
San Diego County,
Regional Transportation Commission
Sales Tax, Series A,
6.20% due 04/01/99 ....................... 500,000 509,585
San Diego County, Tax and
Revenue Anticipation Notes,
4.50% due 09/30/98 ....................... 1,000,000 1,001,719
Statewide Communities Development
Corp. Revenue, Industrial Development,
COP, Sutter Health Obligated Group,
AMBAC Insured, 5% due 08/15/98 ........... 180,000 180,298
Sunnyvale, COP, Parking Facilities
Refunding, Series A, AMBAC Insured,
4.50% due 10/01/98 ....................... 115,000 115,283
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Total Fixed Rate Bonds and Notes (cost: $9,622,226) 9,622,226
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Variable Rate Demand Notes* - 75.03%
Alameda County, Industrial Development
Agency, Tool Family Partnership, AMT,
Series A, 3.50% due 07/01/27 ............. 1,000,000 1,000,000
Alameda-Contra Costa, School Financing
Authority, 3.20% due 07/01/16 ............ 1,000,000 1,000,000
Eastern Municipal Water District, Water
and Sewer Revenue, COP, FGIC Insured,
3% due 07/01/20 .......................... 1,400,000 1,400,000
Fairfield, Industrial Development
Authority, Meyer Cookware Industries,
Inc. Project, Series A, AMT,
3.60% due 05/01/27 ....................... 400,000 400,000
Foothill/Eastern Corridor Agency
California Toll Road Revenue, Series C,
3.10% due 01/02/35 ....................... 700,000 700,000
Glendale, Revenue Reliance
Development, Public Parking,
3.70% due 12/01/14 ....................... 500,000 500,000
Imperial County, COP, Capital Projects,
3.10% due 09/01/17 ....................... 500,000 500,000
Lassen Municipal Utility District, Revenue
Refunding, Series A, AMT, FSA Insured,
3.45% due 05/01/08 ....................... 900,000 900,000
Los Angeles, Regional Airports
Improvement Corp. Lease Revenue,
American Airlines, Los Angeles
International Airport,
Series A, 4% due 12/01/24 ................ 600,000 600,000
Series D, 4% due 12/01/24 ................ 600,000 600,000
Series G, 4% due 12/01/24 ................ 400,000 400,000
Los Angeles County, Regional Airports
Improvement Corp.,
Terminal Facilities Completion Revenue,
Los Angeles International Airport, AMT,
4.05% due 12/01/25 ....................... 1,000,000 1,000,000
4% due 12/01/25 ......................... 2,000,000 2,000,000
6 The accompanying notes are an integral part of these financial statements.
<PAGE>
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Atlas California Municipal Money Fund (continued)
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value
face amount (note 1)
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Moorpark, Multi-Family Revenue,
LeClub Apartments Project, Series A,
3.05% due 11/01/15 ....................... $ 300,000 $ 300,000
Northern California Power Agency Public
Power Revenue Refunding, Geothermal
Project 3, Series A, AMBAC Insured,
3.10% due 07/01/05 ....................... 1,400,000 1,400,000
Oakland, Educational Development
Revenue, Allen Temple Family Life,
Series A, 3.30% due 08/01/27 ............. 1,000,000 1,000,000
Otay, Water District, COP, Capital
Projects, 3.15% due 09/01/26 ............. 700,000 700,000
Palm Springs, Community
Redevelopment Agency, COP,
Project #2, 3.25% due 12/01/14 ........... 300,000 300,000
Project #10, 3.25% due 12/01/14 .......... 400,000 400,000
Pasadena, COP, Rose Bowl Improvement
Project, 3.20% due 12/01/11 .............. 100,000 100,000
Riverside, Multi-Family Revenue
Refunding, Sierra Apartments, Series A,
3.15% due 06/01/05 ....................... 500,000 500,000
San Bernardino County, Industrial
Development Revenue, Tower Industries,
Series IV, AMT, 3.05% due 12/01/06 ....... 790,000 790,000
San Diego County, Multi-Family Housing
Revenue, Country Hills, Series A,
3% due 08/15/13 .......................... 280,000 280,000
San Jose, Multi-Family Mortgage Revenue,
Somerset Park, Series A, AMT,
3.30% due 11/01/17 ..................... 1,600,000 1,600,000
San Leandro, Multi-Family, Carlton Plaza
Project, Series A, 3.45% due 10/01/27 ... 1,000,000 1,000,000
State Educational Facilities Authority
Revenue, Foundation for Educational
Achievement, Series A,
3.30% due 07/01/26 ....................... 800,000 800,000
State Health Facilities Financing
Authority Revenue Refunding,
Catholic Healthcare West, Series D,
MBIA Insured, 3% due 07/01/18 ............ 1,000,000 1,000,000
State Housing Finance Agency
Revenue Refunding,
Catholic Healthcare, Series C,
3% due 07/01/22 .......................... 600,000 600,000
Multi-Family Housing III, Series B, AMT,
3.25% due 05/01/39 ....................... 1,600,000 1,600,000
Pool Program, Series 1990A,
3.10% due 09/01/20 ....................... 600,000 600,000
State Pollution Control Financing
Authority, Pollution Control
Revenue Refunding,
Chevron USA, Inc. Project,
3.65% due 05/15/02 ....................... 300,000 300,000
Pacific Gas & Electric Co., Series B, AMT,
3.25% due 12/01/16 ....................... 1,000,000 1,000,000
Statewide Communities Development,
Multi-Family, Sunrise of Moraga,
Series A, AMT, 4.10% due 07/01/27 ........ 500,000 500,000
Atlas California Municipal Money Fund (continued)
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value
face amount (note 1)
------------- ----------------
Statewide Communities Development
Corp. Revenue, Industrial Development,
COPS,
Citrus Valley Health, MBIA Insured,
3.55% due 04/01/28 ...................... $ 200,000 $ 200,000
Encore Video, AMT, 3.45% due 08/01/07 300,000 300,000
Florestone, AMT, 3.45% due 05/01/09 ... 785,000 785,000
Karcher Property Project, Series C, AMT,
3.25% due 12/01/19 ...................... 1,000,000 1,000,000
Setton Properties Project, AMT,
3.55% due 10/01/10 ...................... 900,000 900,000
Staub Project, Series A, AMT,
3.45% due 08/01/02 ...................... 580,000 580,000
Tri-Valley Industrial Development,
Series F, AMT, 3.25% due 12/01/10 ....... 700,000 700,000
Stockton, Multi-Family, Mariners
Pointe Association, Series A,
3.20% due 09/01/18 ...................... 1,000,000 1,000,000
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Total Variable Rate Demand Notes (cost: $31,235,000) 31,235,000
------------
Total Securities (cost: $43,357,226) - 104.15% 43,357,226
Other Assets and Liabilities, Net - (4.15)% (1,727,909)
------------
Net Assets - 100.00% $ 41,629,317
============
Atlas National Municipal Money Fund
- --------------------------------------------------------------------------------
value
face amount (note 1)
------------- -----------
Tax-Exempt Commercial Paper - 5.55%
West Virginia, Public Energy Authority,
Energy Revenue, Morgantown
Association Project, AMT,
3.55% due 08/03/98 ...................... $ 300,000 $ 300,000
----------
Total Tax-Exempt Commercial Paper (cost: $300,000) 300,000
----------
Fixed Rate Bonds and Notes - 26.01%
Austin, Texas Independent School District
Refunding, 6.10% due 08/01/98 ........... 150,000 150,272
Illinois, Health Facilities Authority,
Servantcor Project, Series A,
FSA Insured, 5.15% due 08/15/98 ......... 300,000 300,412
Logan, Utah, Water, Sewer & Solid Waste
Revenue, Series A, AMBAC Insured,
3.70% due 12/15/98 ...................... 180,000 179,996
Olathe, Kansas, Health Facility Revenue,
Olathe Medical Center Project, Series A,
AMBAC Insured, 4.75% due 09/01/98 ....... 135,000 135,191
Rhode Island, Clean Water Protection
Financing Agency, Water Pollution
Control Revenue Pooled Loan, MBIA
Insured, Series A, 5.45% due 10/01/98 ... 150,000 150,656
7
<PAGE>
Statements of Investments in Securities and Net Assets
June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Atlas National Municipal Money Fund (continued)
- --------------------------------------------------------------------------------
value
face amount (note 1)
------------- ------------
Shawnee County, Kansas, Unified School
District #437, Auburn-Washburn,
FGIC Insured, 5.50% due 09/01/98 ........... $ 90,000 $ 90,232
Washoe County, Nevada School District,
MBIA Insured, 4.90% due 08/01/98 ........... 200,000 200,200
Winslow Township, New Jersey, AMBAC
Insured, 7.80% due 07/01/98 ................ 100,000 100,000
Wisconsin State, Series 3,
4.125% due 11/01/98 ........................ 100,000 100,121
-----------
Total Fixed Rate Bonds and Notes (cost: $1,407,080) 1,407,080
-----------
Variable Rate Demand Notes* - 68.32%
Alachua County, Florida, Housing Finance
Authority, Shands Teaching Hospital,
MBIA Insured, Series B,
3.50% due 12/01/26 ......................... 100,000 100,000
Alaska Industrial Development and
Export Authority, Fairbanks Goldmining,
AMT, 3.65% due 05/01/09 .................... 100,000 100,000
Anchorage, Alaska, Higher Education,
Alaska Pacific University,
3.60% due 07/01/17 ......................... 100,000 100,000
Campbell County, Virginia, Industrial
Development and Export Authority,
Hadson Power, AMT,
4.05% due 04/01/15 ......................... 100,000 100,000
Chicago, Illinois, O'Hare International
Airport, Series B, AMT,
3.65% due 01/01/18 ......................... 200,000 200,000
Clark County, Nevada, Airport
Improvements, Series A-2, AMT,
3.65% due 07/01/25 ......................... 100,000 100,000
Dubuque, Iowa, Industrial
Development Revenue,
Swiss Valley Farms Co. Project,
AMT, 3.70% due 12/01/01 .................... 100,000 100,000
Duluth, Minnesota, Educational
Development Authority,
Health Care Facilities Revenue,
Miller Dwan, 4% due 06/01/19 ............... 200,000 200,000
Florida, Housing Finance Agency,
Multi-Family Refunding, Series E,
3.70% due 04/01/26 ........................ 200,000 200,000
Grapevine, Texas, Industrial
Development Corp.,
American Airlines, Series B4,
4% due 12/01/24 ........................... 100,000 100,000
Halifax County, North Carolina, Industrial
Facilities Agency & Pollution Control
Facilities Agency, Westmoreland, AMT,
4.05% due 12/01/19 ........................ 100,000 100,000
Illinois, Housing Finance Authority, Sisters
Service Hospital, Series E, MBIA Insured,
3.55% due 12/01/14 ......................... 200,000 200,000
Independence, Missouri, Industrial
Development Authority Revenue,
Groves & Graceland, Series A,
4% due 11/01/27 ............................ 200,000 200,000
Atlas National Municipal Money Fund (continued)
- --------------------------------------------------------------------------------
value
face amount (note 1)
------------- -------------
Indiana State, Employment Development
Commission, Triangle Ventures, AMT,
3.90% due 01/01/14 ................. $200,000 $ 200,000
Marion County, West Virginia,
County Commission Solid Waste
Disposal Facility Revenue, Granttown
Project, Series A, AMT,
3.65% due 10/01/17 ................. 100,000 100,000
Municipal Electric Authority,
Georgia, Project One, Series E,
3.40% due 01/01/26 ................. 200,000 200,000
Ohio State, Environmental Improvement
Revenue, Newark Group
Industries, Inc. Project, AMT,
3.60% due 12/01/26 ................. 300,000 300,000
South Carolina, Jobs Economic
Development Authority,
Series 1991, AMT,
4.05% due 04/01/17 ................. 200,000 200,000
St. Louis, Missouri, Industrial
Development Authority, Service
Merchandise Corp., Inc. Project,
3.65% due 09/15/98 ................. 100,000 100,000
Thornton, Colorado Industrial
Development Revenue, Service
Merchandise Corp., Inc. Project,
3.65% due 12/15/99 ................. 200,000 200,000
Utah State Board of Regents, Student
Loan Revenue, Series C, AMT,
AMBAC Insured, 3.50% due 11/01/13 200,000 200,000
Washington, Health Care Facilities
Authority, Fred Hutchinson
Cancer Center,
3.75% due 01/01/23 ................. 200,000 200,000
Winston-Salem, North Carolina, COP,
Risk Acceptance Management Corp.,
3.65% due 07/01/09 ................. 195,000 195,000
------------
Total Variable Rate Demand Notes (cost: $3,695,000) 3,695,000
------------
Total Securities (cost: $5,402,080) - 99.88% 5,402,080
Other Assets and Liabilities, Net - 0.12% 6,525
------------
Net Assets - 100.00% $ 5,408,605
============
Atlas California Municipal Bond Fund
- --------------------------------------------------------------------------------
value
face amount (note 1)
------------- -----------
Bonds - 97.89%
Anaheim Public Financing Authority,
Lease Revenue Capital Appreciation,
Series C, FSA Insured,
0% due 09/01/32 .................... $ 5,000,000 $ 842,550
8 The accompanying notes are an integral part of these financial statements.
<PAGE>
- --------------------------------------------------------------------------------
Atlas California Municipal Bond Fund (continued)
- --------------------------------------------------------------------------------
value
face amount (note 1)
------------- ------------
Anaheim Public Financing Authority,
Lease Revenue Public Improvements
Project, Series A, FSA Insured,
5% due 03/01/37 ........................ $6,000,000 $5,810,220
Brea, Public Finance Authority Revenue
Tax Allocation, Redevelopment Project
AB, Un-Refunded, Series A,
MBIA Insured, 6.75% due 08/01/22 ....... 660,000 719,618
Burbank, Glendale, Pasadena Airport
Authority, Airport Revenue Refunding,
AMBAC Insured, 6.40% due 06/01/10 ...... 2,000,000 2,149,920
Central Coast Water Authority, Revenue
Refunding, State Water Project, Regional
Facilities, Series A, AMBAC Insured,
5% due 10/01/22 ........................ 3,250,000 3,169,465
Contra Costa Water District, Water
Treatment Revenue Refunding, Series G,
MBIA Insured, 5.90% due 10/01/08 ....... 3,600,000 3,953,196
Cotati-Rohnert Park Unified School
District, Series A, FGIC Insured,
6% due 08/01/15 ........................ 905,000 945,227
Elk Grove Unified School District,
Special Tax Refunding, Community
Facilities District 1, AMBAC Insured,
6.50% due 12/01/24 .................. 1,500,000 1,829,130
Fresno Water System Revenue,
Water Remediation Project, Series A,
FGIC Insured,
7.50% due 06/01/05 ..................... 715,000 843,500
Kern High School District Refunding,
MBIA Insured, Series 1990-C,
6.25% due 08/01/12 ..................... 1,200,000 1,392,684
Long Beach Harbor Revenue, AMT,
MBIA Insured, 5.25% due 05/15/25 ....... 2,000,000 1,999,880
Los Angeles, Harbor Development
Revenue, 7.60% due 10/01/18 ............ 140,000 178,699
Los Angeles, Wastewater System
Revenue Refunding,
Series A, MBIA Insured,
5.875% due 06/01/24 .................... 2,250,000 2,390,940
Series B, AMBAC Insured,
6.25% due 06/01/12 ..................... 2,500,000 2,722,025
Los Angeles County, Public Works
Financing Authority, Lease Revenue
Refunding, Series B, MBIA Insured,
5.25% due 09/01/15 ..................... 1,000,000 1,018,070
Los Angeles County,
Transportation Commission,
Sales Tax Revenue, Proposition C,
Second Series A, MBIA Insured,
6.25% due 07/01/13 ..................... 8,980,000 9,870,277
Series B, AMBAC Insured,
6.50% due 07/01/13 ..................... 1,750,000 1,893,850
Los Angeles Department of Water and
Power, Electric Plant Revenue,
7.10% due 01/15/31 ..................... 500,000 546,620
7.125% due 05/15/30 .................... 1,875,000 2,013,994
MSR Public Power Agency, San Juan
Project Revenue, Series E, MBIA Insured,
6.75% due 07/01/11 ..................... 3,000,000 3,267,570
Atlas California Municipal Bond Fund (continued)
- --------------------------------------------------------------------------------
value
face amount (note 1)
------------- ------------
Manhattan Beach Unified School District,
Series A, FGIC Insured,
0% due 09/01/16 ........................ $2,690,000 $1,064,083
Marin Municipal Water District Water
Revenue, MBIA Insured,
5.65% due 07/01/23 ..................... 2,000,000 2,071,240
Maritime Infrastructure Authority,
Airport Revenue, San Diego University,
Port District Airport, AMT,
AMBAC Insured,
5% due 11/01/20 ........................ 9,500,000 9,250,055
Metropolitan Water District, Southern
California Waterworks Revenue,
5.50% due 07/01/19 ..................... 2,500,000 2,549,850
Series C, 5% due 07/01/27 .............. 4,000,000 3,894,880
Mountain View Capital Improvements
Financing Authority Revenue, City Hall
Community Theater, MBIA Insured,
6.25% due 08/01/12 ..................... 1,500,000 1,614,915
New Haven Unified School District
Refunding, MBIA Insured,
3.40% due 08/01/11 ..................... 925,000 971,990
Northern California Power Agency
Public Power Revenue Refunding,
Hydroelectric Project 1,
Series A, AMBAC Insured,
7.50% due 07/01/23 ..................... 50,000 65,487
Series A, MBIA Insured,
6.25% due 07/01/12 ..................... 1,500,000 1,632,390
Oakland Building Authority Lease
Revenue, Elihu M. Harris, Series A,
AMBAC Insured, 5% due 04/01/23 ......... 2,330,000 2,274,849
Oakland Redevelopment Agency,
Revenue Refunding, Pension Financing,
Series A, FGIC Insured,
7.60% due 08/01/21 ..................... 1,250,000 1,278,775
Orange County, Sanitation Districts,
COP Numbers 1, 2, 3, 5, 6, 7, and 11,
Series B, FGIC Insured,
6% due 08/01/16 ........................ 2,000,000 2,155,220
Oroville Hospital Revenue, Series A,
5.40% due 12/01/22 ..................... 1,000,000 1,018,430
Palm Springs Financing Authority,
Airport Passenger Facility Charge
Revenue, FSA Insured,
5.125% due 01/01/18 .................... 1,000,000 983,660
Palo Alto Unified School District,
Series B, 5.375% due 08/01/18 .......... 1,250,000 1,276,788
Pleasanton Unified School District,
Series F, FGIC Insured,
6.25% due 08/01/14 ..................... 570,000 594,533
6.25% due 08/01/15 ..................... 610,000 636,254
6.25% due 08/01/16 ..................... 650,000 677,976
Puerto Rico, Public Buildings Authority
Revenue, Gtd. Government Facilities,
Series A, AMBAC Insured,
6.25% due 07/01/14 ..................... 1,000,000 1,159,450
Puerto Rico Commonwealth, Highway &
Transportation Revenue, Series A,
5% due 07/01/38 ........................ 4,000,000 3,833,480
9
<PAGE>
Statements of Investments in Securities and Net Assets
June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Atlas California Municipal Bond Fund (continued)
- --------------------------------------------------------------------------------
value
face amount (note 1)
------------- ------------
Puerto Rico Commonwealth Refunding,
5% due 07/01/27 ........................... $1,000,000 $ 967,310
MBIA Insured, 6.25% due 07/01/12 .......... 1,000,000 1,155,480
Puerto Rico Electric Power Authority,
Power Revenue, Series EE,
4.75% due 07/01/24 ........................ 1,000,000 937,590
Puerto Rico Ports Authority, American
Airlines, Series A, 6.30% due 06/01/23 .... 1,800,000 1,911,636
Redding Joint Powers Financing Authority,
Electric Systems Revenue Refunding,
Series A, MBIA Insured,
5.25% due 06/01/15 ........................ 2,000,000 2,038,640
Riverside County, Asset Leasing Corp.,
Leasing Revenue, Series B,
MBIA Insured,
5.70% due 06/01/16 ........................ 2,000,000 2,163,000
Sacramento Municipal Utility District,
Electric Revenue Refunding,
Series Z, FGIC Insured,
6.45% due 07/01/10 ........................ 2,500,000 2,702,025
San Bernardino County, COP,
Medical Center Financing Project,
5% due 08/01/28 ........................... 1,500,000 1,454,520
San Bernardino County Transportation
Authority Sales Tax Revenue, Series A,
FGIC Insured, 6% due 03/01/10 ............. 2,500,000 2,701,250
San Diego Public Safety Communication
Project, 6.50% due 07/15/09 ............... 1,525,000 1,786,629
San Francisco City and County,
Series 95 A & B, FGIC Insured,
5.50% due 06/15/13 ........................ 1,145,000 1,191,911
Series E, 6.50% due 06/15/11 .............. 2,220,000 2,378,597
San Francisco City and County Airport
Commission, International Airport
Revenue Refunding, Second Series,
Issue 1, AMBAC Insured,
6.30% due 05/01/11 ........................ 3,000,000 3,250,860
Issue 1, AMBAC Insured,
6.50% due 05/01/13 ........................ 2,000,000 2,188,660
San Francisco City and County
Public Utilities Commission Water
Revenue Refunding, Series A,
6% due 11/01/15 ........................... 1,000,000 1,060,440
San Francisco City and County
Redevelopment Agency, Hotel Tax
Revenue, FSA Insured,
5% due 07/01/25 ........................... 3,750,000 3,657,750
San Francisco City and County Sewer
Revenue Refunding, AMBAC Insured,
6% due 10/01/11 ........................... 2,280,000 2,458,729
San Joaquin Hills Transportation Corridor
Agency, Toll Road Revenue,
0% due 01/01/07 ........................... 1,000,000 968,240
0% due 01/01/09 ........................... 1,000,000 1,002,810
San Jose Redevelopment Agency Tax
Allocation, Merged Area Redevelopment
Project Refunding, MBIA Insured,
5% due 08/01/20 ........................... 2,500,000 2,447,525
San Mateo County, Joint Powers
Authority, Lease Revenue Capital
Projects, Series A, 5.125% due 07/15/32 ... 2,145,000 2,112,653
Atlas California Municipal Bond Fund (continued)
- --------------------------------------------------------------------------------
value
face amount (note 1)
------------- ------------
Santa Barbara, Revenue COP, Retirement
Services, 5.75% due 08/01/20 .............. $2,000,000 $2,091,780
Santa Clara Electric Revenue,
1991, Series A, MBIA Insured,
6.25% due 07/01/19 ........................ 3,750,000 4,062,000
Santa Margarita, Dana Point Authority
Revenue Refunding, Improvement
District 3, 3A, 4, and 4A,
Series B, MBIA Insured,
7.25% due 08/01/07 ........................ 500,000 605,545
7.25% due 08/01/13 ........................ 2,000,000 2,521,620
Santa Monica, Malibu Unified School
District, Public School Facilities
Reconstruction Projects A,
6.90% due 08/01/11 ........................ 500,000 547,620
Saugus Unified School District, Series A,
MBIA Insured, 5.65% due 09/01/11 .......... 2,035,000 2,180,910
Southern California Public Power
Authority Power Project Revenue
Refunding, Hydroelectric Hoover
Uprating Project, Series A,
6.625% due 10/01/05 ....................... 600,000 657,708
Southern California Public Power
Authority Transmission Project Revenue
Refunding, Southern Transportation
System, 5.75% due 07/01/10 ................ 2,000,000 2,001,000
Southern California Rapid Transit District,
COP, Workers Compensation Fund,
MBIA Insured, 6% due 07/01/10 ............. 1,000,000 1,064,130
State, Refunding,
5% due 10/01/23 ........................... 3,000,000 2,932,440
AMBAC Insured, 5.25% due 06/01/21 ......... 1,000,000 1,001,490
FGIC Insured, 5% due 02/01/23 ............. 2,500,000 2,441,125
Series BH, AMT, 5.60% due 12/01/32 ........ 1,000,000 1,010,830
State, Various Purpose,
6.125% due 10/01/11 ....................... 1,000,000 1,141,420
State Department of Water Resources
Central Valley Project Revenue,
Series J-2, 6.125% due 12/01/13 ........... 2,225,000 2,354,606
Series J-3, 5.50% due 12/01/23 ............ 3,000,000 3,030,420
Series O, 5% due 12/01/15 ................. 2,000,000 1,995,300
State Educational Facilities Authority
Revenue Refunding,
Los Angeles College Chiropractic,
5.60% due 11/01/17 ........................ 1,810,000 1,865,024
Loyola Marymount University,
5% due 10/01/22 ........................... 700,000 683,599
Pepperdine University, MBIA Insured,
6.10% due 03/15/14 ........................ 2,595,000 2,852,502
Santa Clara University, MBIA Insured,
5.75% due 09/01/18 ........................ 3,255,000 3,400,336
University of Southern California,
Series C, 5.125% due 10/01/28 ............. 1,000,000 987,040
State Health Facilities Financing
Authority Revenue Refunding,
Stanford Health Care, Series A,
FSA Insured, 5% due 11/15/98 .............. 1,000,000 969,570
Stripps Health, Series C, MBIA Insured,
5% due 10/01/22 ........................... 500,000 486,940
Sutter Health Systems, Series A,
FSA Insured, 5% due 08/15/37 .............. 1,000,000 961,800
10 The accompanying notes are an integral part of these financial statements.
<PAGE>
- --------------------------------------------------------------------------------
Atlas California Municipal Bond Fund (continued)
- --------------------------------------------------------------------------------
value
face amount (note 1)
------------- --------------
State Housing Finance Agency Revenue
Home Mortgage, Multi-Family Program,
Series B, AMT, AMBAC Insured,
6.05% due 08/01/16 ....................... $2,000,000 $ 2,104,740
Series B, AMT, AMBAC Insured,
5.25% due 02/01/28 ....................... 2,000,000 1,965,400
Series H, AMT,
6.15% due 08/01/16 ....................... 2,020,000 2,144,594
Series I, AMT, MBIA Insured,
5.65% due 08/01/17 ....................... 2,400,000 2,479,776
Series K, MBIA Insured,
6.15% due 08/01/16 ....................... 3,000,000 3,185,040
Series L, AMT, MBIA Insured,
5.55% due 08/01/05 ....................... 300,000 315,573
Series Q, MBIA Insured,
5.85% due 08/01/16 ....................... 1,000,000 1,055,060
State Pollution Control Financing
Authority, Pollution Control Revenue,
MBIA Insured, Pacific Gas & Electric
Co., Series B, 5.85% due 12/01/23 ........ 2,000,000 2,096,640
State Public Works Board, Lease Revenue,
AMBAC Insured, Various University of
California Projects, Series C,
5.125% due 09/01/22 ...................... 1,475,000 1,457,772
State Rural Home Mortgage Finance
Authority, Single Family Revenue
Refunding, Series C, AMT,
7.50% due 08/01/27 ....................... 1,065,000 1,223,184
Statewide Communities Development
Authority, Apartment Development
Revenue, Irvine Apartments,
5.25% due 05/15/25 ....................... 1,000,000 1,004,860
Statewide Communities Development
Authority, Lease Revenue,
United Airlines, AMT, Series A,
5.70% due 10/01/33 ....................... 4,000,000 4,088,000
Stockton Health Facilities Revenue,
Dameron Hospital, Series A,
5.70% due 12/01/14 ....................... 200,000 204,028
Truckee, Donner Public Utility District,
COP, Water System Improvement Project,
MBIA Insured,
6.75% due 11/15/21 ....................... 1,000,000 1,106,140
Turlock Irrigation District Revenue
Refunding, Series A, MBIA Insured,
5.90% due 01/01/02 ....................... 80,000 84,782
6% due 01/01/10 .......................... 1,000,000 1,124,920
Upland, COP, San Antonio Community
Hospital, 5% due 01/01/18 ................ 3,195,000 3,060,618
Vallejo Revenue Water Improvement
Project, Series B, FGIC Insured,
6.50% due 11/01/14 ....................... 4,000,000 4,514,000
Watsonville Water Revenue Refunding,
Series A, MBIA Insured,
6% due 05/15/16 .......................... 1,915,000 2,026,319
Westside Unified School District
Refunding, Series C, AMBAC Insured,
6% due 08/01/14 .......................... 300,000 339,683
-------------
Total Bonds (cost: $192,907,280) .......... 206,525,879
-------------
Atlas California Municipal Bond Fund (continued)
- --------------------------------------------------------------------------------
value
face amount (note 1)
------------- ---------------
Variable Rate Demand Notes* - 0.66%
Alameda County Industrial Development
Authority, Dicon Fiberoptics, Inc.,
Series A, AMT, 3.50% due 05/01/03 ........... $100,000 $ 100,000
Contra Costa Home Mortgage,
Multi-Family Revenue, Lakeshore
Apartments, Series C, 3% due 11/15/12 ....... 295,000 295,000
Los Angeles, Regional Airports
Improvement Corp. Lease Revenue,
American Airlines - LAX,
Series A, 4% due 12/01/24 ................... 100,000 100,000
Series B, 4% due 12/01/24 ................... 400,000 400,000
Series C, 4% due 12/01/24 ................... 200,000 200,000
Los Angeles County, Pension Obligation,
Series C, AMBAC Insured,
3.10% due 06/30/07 .......................... 100,000 100,000
Los Angeles County, Regional
Airports Improvement Corp.,
Terminal Facilities Completion Revenue,
Los Angeles International Airport, AMT,
4.05% due 12/01/25 .......................... 200,000 200,000
--------------
Total Variable Rate Demand Notes (cost $1,395,000) 1,395,000
--------------
Total Securities (cost: $194,302,280) - 98.55% 207,920,879
Other Assets and Liabilities, Net - 1.45% 3,063,087
--------------
Net Assets - 100.00% $ 210,983,966
==============
Atlas National Municipal Bond Fund
- --------------------------------------------------------------------------------
value
face amount (note 1)
------------- -------------
Bonds - 97.24%
Alabama State Docks Department, Docks
Facilities Revenue, AMT, MBIA Insured,
6.10% due 10/01/13 ...................... $ 1,000,000 $ 1,089,840
Anchorage, Alaska, Electric Utility
Revenue Refunding, Senior Lien,
MBIA Insured, 8% due 12/01/10 ........... 985,000 1,294,714
Birmingham, Michigan, City School
District, FSA Insured,
4.75% due 11/01/24 ...................... 2,000,000 1,882,500
California State Public Works Board, Lease
Revenue, Department of Corrections,
California State Prison, Series B,
MBIA Insured,
5.375% due 12/01/19 ..................... 1,150,000 1,165,732
Central Coast Water Authority, California
Revenue Refunding State Water Project,
Regional Facilities, Series A,
AMBAC Insured, 5% due 10/01/22 .......... 1,000,000 975,220
Chicago, Illinois, Metropolitan Water
Reclamation District, Greater
Chicago Capital Improvement,
7.25% due 12/01/12 ...................... 1,500,000 1,880,985
11
<PAGE>
Statements of Investments in Securities and Net Assets
June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Atlas National Municipal Bond Fund (continued)
- --------------------------------------------------------------------------------
value
face amount (note 1)
------------- ------------
Chicago, Illinois, Park District
Aquarium & Museum, Series B,
6.50% due 11/15/13 ..................... $1,500,000 $1,707,795
Chicago, Illinois, Public Building
Commission Mortgage Revenue, Board
of Education, Series A, MBIA Insured,
7.125% due 01/01/15 .................... 125,000 133,076
Cleveland, Ohio, Waterworks Revenue
First Mortgage Refunding,
Series F-92B, AMBAC Insured,
6.25% due 01/01/16 ..................... 1,000,000 1,077,980
Colorado, Housing Finance Authority,
Single Family Program,
Senior Series A-1, AMT,
7.40% due 11/01/27 ..................... 1,000,000 1,127,010
Colorado, Public Highway Authority,
E-470, Capital Appreciation,
Series B, MBIA Insured,
0% due 09/01/21 ........................ 2,000,000 603,320
Colorado Springs, Colorado, Utilities
Revenue Refunding, Series A,
6.50% due 11/15/15 ..................... 2,000,000 2,174,020
Cook County, Illinois, MBIA Insured,
7.25% due 11/01/07 ..................... 620,000 747,441
Series C, FGIC Insured,
6% due 11/15/08 ........................ 500,000 562,925
Dallas, Fort Worth, Texas,
Regional Airport Revenue, Joint
Dallas-Fort Worth, AMT, MBIA Insured,
5.50% due 11/01/23 ..................... 1,500,000 1,538,415
Harris County, Texas Toll Road,
Senior Lien, FGIC Insured,
5.375% due 08/15/20 .................... 1,000,000 1,014,720
Hudsonville, Michigan, Public Schools,
FGIC Insured, 5.15% due 05/01/27 ....... 1,000,000 991,020
Illinois Development Finance Authority,
Pollution Control Revenue,
Public Service Co., Series C-2,
5.70% due 08/15/26 ..................... 1,000,000 1,031,490
Illinois Health Facilities Authority
Revenue Refunding,
Northwestern Medical Facilities
Foundation, AMT, MBIA Insured,
5.125% due 11/15/28 .................... 1,000,000 973,660
Sherman Hospital Project, MBIA Insured,
6.75% due 08/01/11 ..................... 1,000,000 1,095,830
Indiana State Office Building Commission,
Capital Complex Revenue,
Senate Avenue Parking, Series A,
MBIA Insured,
7.25% due 07/01/12 ..................... 50,000 54,122
Indianapolis, Indiana, Airport Authority
Revenue, Special Facilities,
Federal Express Corp., AMT,
7.10% due 01/15/17 ..................... 500,000 562,975
Jefferson County, Colorado, School
District, #R-001, MBIA Insured,
6.50% due 12/15/10 ..................... 400,000 471,872
Jones County, Mississippi Hospital
Revenue, South Central Regional Medical
Center, 5.50% due 12/01/17 ............. 1,000,000 997,110
Atlas National Municipal Bond Fund (continued)
- --------------------------------------------------------------------------------
value
face amount (note 1)
------------- ------------
Kansas City, Kansas, Utility System
Revenue Refunding and Improvement,
FGIC Insured, 6.375% due 09/01/23 ........ $1,500,000 $1,673,595
Kern, California High School District,
Series 1990-C Election, MBIA Insured,
6.25% due 08/01/10 ....................... 545,000 633,142
Lakota, Ohio, Local School District,
AMBAC Insured, 7% due 12/01/09 ........... 1,740,000 2,119,807
Long Island Power Authority, New York
Electric System Revenue, Series A,
5.25% due 12/01/26 ....................... 1,000,000 989,750
Maine State Housing Authority Mortgage
Purchase, Series A-1, AMT, AMBAC
Insured, 6.40% due 11/15/14 .............. 1,400,000 1,487,234
Maricopa County, Arizona, Unified School
District 69, Paradise Valley Refunding,
MBIA Insured,
6.35% due 07/01/10 ....................... 600,000 697,224
Massachusetts State Health and
Educational Facilities Authority Revenue,
Northeastern University, Series E,
MBIA Insured, 6.55% due 10/01/22 ......... 500,000 550,370
Massachusetts State Industrial
Financing Agency Revenue,
Wentworth Institute of Technology,
5.65% due 10/01/18 ....................... 500,000 507,020
Massachusetts State Turnpike Authority,
Metropolitan Highway System
Revenue, Series A, MBIA Insured,
5% due 01/01/27 .......................... 1,000,000 971,890
Metropolitan Pier & Exposition Authority,
Illinois, Dedicated State Tax Revenue,
McCormick Place Expansion Project,
Series A, 7.25% due 06/15/05 ............. 250,000 290,970
Metropolitan Transportation Authority,
New York, Transportation Facilities
Revenue, Series 8, Service Contract,
5.375% due 07/01/21 ...................... 1,000,000 1,005,360
Michigan State Hospital
Financing Authority Revenue,
Genesys Regional Medicine, Series A,
5.50% due 10/01/27 ....................... 1,000,000 989,860
Michigan State University Revenue,
Series A, 6.125% due 08/15/08 ............ 500,000 541,675
Mississippi Higher Education Assistance
Corp. Student Loan Revenue,
Series C, AMT, 6.05% due 09/01/07 ........ 860,000 904,101
Nevada Housing Division,
Single Family Mortgage, Series C, AMT,
6.60% due 04/01/14 ....................... 985,000 1,045,972
New York City, New York, Industrial
Development Authority, Special Facilities,
United Airlines, Inc., AMT,
5.65% due 10/01/32 ....................... 1,000,000 1,013,620
New York City, New York,
Municipal Water Finance Authority,
New York City, New York, Series F,
6% due 08/01/11 .......................... 500,000 541,405
New York City, New York, Series I,
5.875% due 03/15/14 ...................... 500,000 530,805
12 The accompanying notes are an integral part of these financial statements.
<PAGE>
- --------------------------------------------------------------------------------
Atlas National Municipal Bond Fund (continued)
- --------------------------------------------------------------------------------
value
face amount (note 1)
------------- ------------
New York City, New York,
Series L, 5.75% due 08/01/12 ............... $ 500,000 $ 531,035
New York State Dormitory
Authority Revenue,
City University System, FGIC Insured,
5% due 07/01/26 ............................ 1,500,000 1,460,325
Pooled Capital Program, FGIC Insured,
7.80% due 12/01/05 ......................... 130,000 134,423
New York State Highway Authority,
Service Contract Revenue, Local Highway
and Building, 5% due 04/01/17 .............. 1,000,000 969,160
New York State Urban Development Corp.
Revenue, Correctional Facilities, Series A,
5.50% due 01/01/16 ......................... 1,000,000 1,013,480
Northern California Power Agency, Public
Power Revenue Refunding, Hydroelectric
Project 1, Series A, MBIA Insured,
6.25% due 07/01/12 ......................... 750,000 816,195
Philadelphia, Authority for Industrial
Development Revenue, Franklin Institute
Project, 5.20% due 06/15/26 ................ 1,000,000 962,920
Pinal County, Arizona, Unified School
District 43, Apache JCT, Series A,
FGIC Insured, 6.80% due 07/01/09 ........... 425,000 508,198
Puerto Rico Commonwealth
Highway & Transportation Revenue,
Series A, 5% due 07/01/38 .................. 1,000,000 958,370
Red River Authority, Texas,
Pollution Control Revenue,
Hoechst Celanese Corp. Project, AMT,
6.875% due 04/01/17 ........................ 1,500,000 1,635,570
Sacramento, California, Municipal Utility
District Electric Revenue Refunding,
Series Z, FGIC Insured,
6.45% due 07/01/10 ......................... 600,000 648,486
Superior, Wisconsin, Limited Obligation
Revenue Refunding, Midwest Energy
Resources, Series E, FGIC Insured,
6.90% due 08/01/21 ......................... 500,000 618,985
Tallassee, Alabama, Industrial
Development Board Revenue Refunding,
Dow United Technologies Corp., Series B,
6.10% due 08/01/14 ......................... 1,000,000 1,085,440
Texas Health Facilities Development Corp.
Hospital Revenue, Cook-Fort Worth
Children's Center Refunding, FGIC
Insured, 6.25% due 12/01/12 ................ 1,000,000 1,101,490
Tulsa, Oklahoma, Airport Transportation
Revenue, American Airlines, Inc., AMT,
7.375% due 12/01/20 ........................ 2,000,000 2,151,160
University of Maryland, System Auxiliary
Facility and Tuition Revenue, Series A,
6.30% due 02/01/10 ......................... 500,000 536,865
Atlas National Municipal Bond Fund (continued)
- --------------------------------------------------------------------------------
value
face amount (note 1)
------------- --------------
Utah State Board of Regents Student Loan
Revenue, Series N, AMT,
AMBAC Insured, 5.90% due 11/01/07 .......... $1,000,000 $ 1,082,430
Vermont Educational & Health Buildings
Financing Agency, Norwich University
Project, 5.50% due 07/01/21 ................ 1,000,000 992,260
Washington State Public Power Supply
System Refunding Revenue,
Nuclear Project 2 Revenue Refunding,
Series A, 7.25% due 07/01/06 ............... 500,000 585,500
Nuclear Project 2 Revenue Refunding,
Series B, 7% due 07/01/12 .................. 140,000 150,678
West Virginia School Building Authority
Revenue, Series A, MBIA Insured,
7.25% due 07/01/15 ......................... 50,000 54,123
Wisconsin State Health and Educational
Facilities Authority Revenue,
Aurora Medical Group, Inc. Project,
FSA Insured,
5.75% due 11/15/07 ......................... 500,000 544,155
6% due 11/15/10 ............................ 1,000,000 1,131,940
-------------
Total Bonds (cost: $57,302,238) 61,320,760
-------------
Variable Rate Demand Notes* - 1.43%
Illinois Development Finance Authority
Revenue, Council for Jewish Elderly,
3.60% due 03/01/15 ......................... 200,000 200,000
Illinois, Housing Finance Authority, Sisters
Service Hospital, Series E, MBIA Insured,
3.55% due 12/01/14 ......................... 100,000 100,000
Indiana Employment Development
Commission, Double Eagle, AMT,
3.90% due 01/01/13 ......................... 200,000 200,000
Lone Star, Texas Airport, Series A-1,
4% due 12/01/14 ............................ 100,000 100,000
Morgan County, Utah, Solid Waste
Disposal, Holman, Inc. Project, AMT,
3.70% due 08/01/31 ......................... 100,000 100,000
South Carolina, Jobs Economic
Development Authority, Series 1991,
AMT, 4.05% due 04/01/17 .................... 100,000 100,000
Utah State Board of Regents Student Loan
Revenue, Series C, AMT,
AMBAC Insured, 3.50% due 11/01/03 .......... 100,000 100,000
-------------
Total Variable Rate Demand Notes (cost $900,000) 900,000
-------------
Total Securities (cost: $58,202,238) - 98.67% 62,220,760
Other Assets and Liabilities, Net - 1.33% 836,415
-------------
Net Assets - 100.00% $ 63,057,175
=============
13
<PAGE>
Statements of Investments in Securities and Net Assets
June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Atlas U.S. Government and Mortgage Securities Fund
- --------------------------------------------------------------------------------
value
face amount (note 1)
------------- -----------------
U.S. Government Agencies - 97.37%
Federal Home Loan Mortgage Corp.
7.00% due 2023 - 2027 .................. $ 8,764,950 $ 8,898,893
7.50% due 2023 - 2024 .................. 16,551,024 16,968,031
8.00% due 2024 - 2026 .................. 9,759,499 10,096,744
8.50% due 2010 - 2026 .................. 2,888,772 3,021,720
9.00% due 2017 - 2024 .................. 4,875,515 5,184,828
9.50% due 2016 - 2021 .................. 1,128,564 1,212,024
10.00% due 2015 - 2020 ................. 98,624 107,222
10.50% due 2018 - 2020 ................. 79,962 89,226
Federal National Mortgage Assn.
6.50% due 2023 - 2028 .................. 3,303,302 3,292,163
7.00% due 2026 - 2028 .................. 51,628,667 52,359,819
7.50% due 2025 - 2028 .................. 29,042,845 29,791,400
8.00% due 2024 - 2028 .................. 47,069,151 48,718,878
8.50% due 2014 - 2027 .................. 7,951,722 8,288,954
9.00% due 2021 - 2025 .................. 5,504,267 5,826,130
9.50% due 2020 ......................... 44,646 47,935
Government National Mortgage Assn.
7.50% due 2022 - 2024 .................. 6,537,605 6,727,566
8.00% due 2023 - 2025 .................. 2,338,096 2,426,458
8.50% due 2016 - 2020 .................. 88,605 94,003
-------------
Total U.S. Government Agencies (cost: $198,862,397) 203,151,994
-------------
Short-Term Investments - 16.06%
5.99% FNMA Floating Collateralized
Mortgage Obligation due 1998 .......... 111,879 112,054
6.09% FNMA Floating Collateralized
Mortgage Obligation due 1998 .......... 66,298 66,380
6.14% FHLMC Floating Collateralized
Mortgage Obligation due 1999 .......... 341,786 342,319
6.29% FNMA Floating Collateralized
Mortgage Obligation due 1999 .......... 504,510 506,241
Repurchase Agreement dated June 30,
1998 with Morgan Stanley & Co., Inc.,
effective yield of 5.53%, due July 14,
1998 with respect to $15,255,487
FHLMCs, 6.16%, July 1, 2034 with a
value of $15,306,161 (g) .............. 15,000,000 15,048,388
Repurchase Agreement dated June 30,
1998 with DLJ Securities Corp.,
effective yield of 5.53%,
due July 1, 1998 with respect to
$17,751,401 FHLMCS, 6%, June 1, 2025
with a value of $18,239,564 ........... 17,425,000 17,427,904
-------------
Total Short-Term Investments (cost: $33,502,867) 33,503,286
-------------
Total Securities (cost: $232,365,264) - 113.43% 236,655,280
Other Assets and Liabilities, Net - (13.43)% (28,014,729)
-------------
Net Assets - 100.00% $ 208,640,551
=============
Atlas Strategic Income Fund
- --------------------------------------------------------------------------------
face amount value
or units (m) (note 1)
-------------- -----------
Mortgage-Backed Obligations - 20.10%
Commercial - 3.39%
Asset Securitization Corp.,
Commercial Sub. Bonds,
Series 1997-D5, Cl. B2,
6.93% due 02/14/41 .................... $ 400,000 $ 356,625
CS First Boston Mortgage Securities
Corp., Series 1997-C1,
Cl. F, 7.50% due 06/20/13 (a)(c)(g) 50,000 50,375
Cl. G, 7.50% due 06/20/14 (a)(c)(g) 50,000 48,563
Cl. H, 7.50% due 08/20/14 (a)(c)(g) 30,000 24,122
First Chicago/Lennar Trust, Commercial
Collateral Strip Interest,
Series 1997-CHL1, Cl. D,
8.13% due 05/29/08 (a)(c)(g) .......... 100,000 102,281
Series 1997-CHL1, Cl. E,
8.11% due 02/28/11 (a)(c)(g) .......... 150,000 130,078
GMAC Commercial Mortgage Securities,
Inc., Series 1997-C1,
Cl. G, 7.414% due 09/30/06 ............ 120,000 114,075
Cl. X, 1.6287% due 07/15/27 ........... 975,000 94,148
GMAC Commercial Mortgage Securities,
Inc., Series 1997-C2,
Cl. F, 6.75% due 04/15/29 ............. 100,000 85,375
Morgan Stanley Capital I, Inc.,
Commercial Sub. Bonds,
Series 1997-RR, Cl. D, 7.739%
due 04/30/39 (a)(c)(g) ................ 200,000 193,000
Series 1997-RR, Cl. E, 7.67%
due 04/30/39 (a)(c)(g) ................ 75,000 71,297
Series 1997-HF1, Cl. F, 6.86%
due 02/15/10 (a)(c)(g) ................ 50,000 45,641
Series 1997-XL1, Cl. G, 7.695%
due 10/03/30 (a)(c)(g) ................ 60,000 58,631
Series 1997-RR, Cl. F, 7.74%
due 11/01/07 (a)(c)(g) ................ 175,000 140,109
Nykredit As,
6% Mortgage-Backed Security,
Series ANN, due 10/01/26 (DKK) ........ 754,000 113,967
8% Mortgage-Backed Security, due
10/01/26 (DKK) ........................ 1,780,000 264,951
Realkredit Danmark,
6% Mortgage-Backed Security
due 10/01/26 (DKK) .................... 736,000 111,363
Salomon Brothers Mortgage Securities
VII, Series 1996-C1, Cl. F,
9.18% due 02/20/26 .................... 250,000 220,156
Salomon Brothers, Inc.,
Commercial Mortgage Pass-Through
Certificates, Series 1998-1A,
5% due 12/15/00 ....................... 85,958 82,520
Structured Asset Securities Corp.,
Commercial Mtg. Pass-Through
Certificates, Series 1997-LL1, Cl. F,
7.30% due 04/12/12 (a) ................ 50,000 48,656
14 The accompanying notes are an integral part of these financial statements.
<PAGE>
- --------------------------------------------------------------------------------
Atlas Strategic Income Fund (continued)
- --------------------------------------------------------------------------------
face amount value
or units (m) (note 1)
-------------- -------------
Government Agency - 16.22%
Federal Home Loan Mortgage Corp.,
Interest-Only Stripped
Mortgage-Backed Security, Series 177,
9% due 07/01/26 (h) ...................... $ 1,854,100 $ 410,218
Series 5022, 15% due 02/23/00 ............ 1,279,000 110,690
Series 151, Cl. F, 9% due 05/15/21 ....... 500,000 523,067
Federal National Mortgage Assn.,
7% due 07/01/13 (j) ...................... 1,250,000 1,272,663
7% due 07/01/26 .......................... 796,888 809,084
7% due 01/01/28 .......................... 1,484,126 1,504,985
Government National Mortgage Assn.,
7% due 03/15/28 .......................... 3,336,513 3,391,100
7% due 07/01/28 (j) ...................... 3,220,000 3,271,327
Multi-Family - .49%
Criimi Mae, Inc., Trust I, Series
1996-C1, Cl. A2,
7.56% due 06/30/33 ....................... 100,000 100,125
Mortgage Capital Funding, Inc.,
Multifamily Mtg. Pass-Through
Certificates, Series 1996-MC1, Cl. G,
7.15% due 06/15/06 ....................... 250,000 239,493
------------
Total Mortgage-Backed Obligations (cost: $14,049,390) 13,988,685
------------
U.S. Government Obligations - 29.78%
U.S. Treasury Bonds:
11.875% due 11/15/03 (p) ................. 2,170,000 2,796,588
10.75% due 02/15/03 ...................... 1,310,000 1,583,052
9.375% due 02/15/06 (n) .................. 2,345,000 2,896,807
6.50% due 11/15/26 ....................... 2,000,000 2,221,250
6.125% due 11/15/27 ...................... 130,000 139,303
U.S. Treasury Notes:
5.50% due 01/31/03 (o) ................... 4,190,000 4,186,070
5.50% due 03/31/03 ....................... 900,000 899,438
10.75% due 05/15/03 ...................... 400,000 487,375
7.50% due 02/15/05 ....................... 700,000 775,031
6.50% due 08/15/05 ....................... 375,000 395,859
6.50% due 10/15/06 ....................... 2,260,000 2,400,543
6.125% due 08/15/07 ...................... 1,875,000 1,951,757
------------
Total U.S. Government Obligations (cost: $20,539,215) 20,733,073
------------
Foreign Government Obligations - 13.06%
Argentina - 1.94%
Argentina (Republic of),
Unsec. Unsub. Notes,
5.50% due 03/27/01 (JPY) ................. 40,000,000 294,352
Bonds, Bonos de Consolidacion
de Deudas, Series Previs 2,
5.635% due 04/01/01 (c) .................. 14,121 12,321
Unsec. Unsub. Notes,
8.75% due 07/10/02 (ARP) ................. 160,000 138,419
Bonds, 5% due 12/20/02 (JPY).............. 10,000,000 63,812
Past Due Interest Global Bearer Bonds,
6.625% Debentures due 03/31/05 (c) ....... 370,500 327,837
11% due 10/09/06 ......................... 10,000 10,600
Notes, 11.75% due 02/12/07 (ARP) ......... 80,000 74,810
Series Pro1, 2.996% Bonds
due 04/01/07 (ARP) (c) ................... 293,298 197,022
Atlas Strategic Income Fund (continued)
- --------------------------------------------------------------------------------
face amount value
or units (m) (note 1)
-------------- ----------
Unsec. Unsub. Notes,
11.375% due 01/30/17 .................... $ 90,000 $ 95,805
Par Bonds, 5.75% due 03/31/23 (e) ....... 180,000 133,425
Brazil - 1.58%
Brazil (Federal Republic of),
Capitalization Bonds,
8% due 04/15/14 (c) ..................... 929,240 681,830
Debt Conversion Bond, Series RG,
6.875% due 04/15/12 (c) ................. 250,000 172,363
18 years Debt Conversion Bond, Series L,
6.687% due 04/15/12 (c) ................. 350,000 243,040
Bulgaria - .14%
Bulgaria (Republic of),
Front-Loaded Interest Reduction
Bearer Bonds, Tranche A,
2.25% due 07/28/12 (e) .................. 120,000 72,300
Past Due Interest Bonds, 6.563%
Debentures due 07/28/11 (c) ............. 40,000 28,225
Canada - .56%
Canada (Government of) Bonds,
Series A-33, 11.50% Debentures
due 09/01/00 (CAD) ...................... 510,000 389,961
Ecuador - .12%
Ecuador (Republic of), Global Bearer
Past Due Interest Bonds,
3.25% Debentures due 02/27/15 (c) ....... 55,633 33,274
Ecuador (Republic of), 6.625% Gtd. 30
years Discount Bonds due 02/28/25 ....... 70,000 49,392
Germany - 2.72%
Bundesschatzanweisungen, Series 98,
4% Notes due 03/17/00 (DEM) ............. 1,175,000 651,050
Germany (Republic of) Bonds,
Series 97, 6% due 07/04/07 (DEM) ........ 660,000 397,967
Series 98, 5.25% due 01/04/08 (DEM) ..... 1,475,000 846,168
Great Britain - 1.25%
United Kingdom Treasuries,
9% Bonds due 08/06/12 (GBP) ............. 50,000 108,791
8.50% due 12/07/05 (GBP) ................ 400,000 764,434
Hungary - .07%
Hungary Government Bonds, Series
99/G, 16.50% due 07/24/99 (HUF) ......... 10,000,000 45,656
Italy - 1.03%
Italy (Republic of) Treasury Bonds,
Buoni del Tesoro Poliennali,
10.50% due 04/01/05 (ITL) ............... 40,000,000 29,640
9% due 10/01/03 (ITL) ................... 325,000,000 218,075
8.50% debentures due 01/01/04 (ITL) ..... 705,000,000 466,710
Ivory Coast - .07%
Ivory Coast ( Government of) Past Due
Interest, 4.8% Bonds due 03/29/18 (e) 141,000 51,465
Jordan - .05%
Hashemite ( Kingdom of Jordan) Bonds,
Series DEF, 5% due 12/23/23 (e) ......... 50,000 36,901
Mexico - .95%
United Mexican States Bonds,
10.375% due 01/29/03 (DEM) .............. 25,000 15,471
8.125%/10.875% Bonds
due 09/10/04 (DEM) ...................... 220,000 132,428
Series B, 6.25% Sec. Debentures
due 12/31/19 ............................ 250,000 206,563
Series W-A, 6.25% due 12/31/19 .......... 375,000 309,611
15
<PAGE>
Statements of Investments in Securities and Net Assets
June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Atlas Strategic Income Fund (continued)
- --------------------------------------------------------------------------------
face amount value
or units (m) (note 1)
-------------- ------------
New Zealand - .20%
New Zealand (Government of),
Bonds, 8% due 02/15/01 (NZD) ............ $ 25,000 $ 13,266
Bonds, 8% due 04/15/04 (NZD) ............ 225,000 124,133
Norway - .35%
Norwegian Government, Gtd. Bonds,
9.50% due 10/31/02 (NOK) ................ 1,630,000 244,169
Panama - .12%
Panama (Republic of),
Past Due Interest, 20 years,
4% Debentures due 07/17/16 (c) .......... 51,356 40,510
Pycsa Panama SA., 10.28% Sr. Sec. Bonds
due 12/15/12 (a) ........................ 45,000 42,581
Peru - .49%
Peru (Republic of) Trust, Zero Coupon
Sr. Notes due 02/28/16 .................. 812,238 341,140
Poland - .52%
Poland (Republic of),
Unsec. Non-U.S. Global Bearer Bond,
Series PDIB, 4% due 10/27/14 (e) ........ 400,000 365,000
Russia - .38%
Russia (Government of),
Principal Loans Debentures, 19 Years,
6.625% due 12/15/15 ..................... 65,000 36,156
City of St. Petersburg, 9.50% Sr. Unsec.
Unsub. Notes due 06/18/02 (a) ........... 50,000 38,750
Ministry of Finance (Russian
Government), 10% Unsec. Unsub. Bonds
due 06/26/07 (a) ........................ 80,000 60,200
Interest Notes, Series US,
15% debentures due 12/15/15 (c) ......... 2,017 1,117
CSFB Russian Swap,
29.8% Bond due 07/14/99 (RR) ............ 200,000 29,497
28.9% Bond due 07/14/99 (RR) ............ 370,000 54,569
23.20% Bond due 04/28/99 (RR) ........... 149,000 21,634
18.29% Bond due 04/28/99 (RR) ........... 160,000 23,231
South Africa - .39%
South Africa (Republic of) Bonds,
Series 153, 13% Consolidation Bonds
due 08/31/10 (ZAR) ...................... 1,800,000 269,750
Sweden - .09%
Sweden (Kingdom of) Bonds, Series
1037, 8% due 08/15/07 (SEK) ............. 400,000 61,218
Venezuela - .03%
Venezuela (Republic of),
9.25% Unsec. bonds due 09/15/27 ......... 30,000 23,250
Vietnam - .01%
Vietnam (Government of),
3% Par Bonds due 03/12/28 ............... 12,000 4,080
-----------
Total Foreign Government Obligations (cost: $9,444,127) 9,093,969
-----------
Loan Participations - 0.49%
Korea (Republic of) Restructured Loan
Participation Agreement,
8.281% due 04/08/00 (c) ................. 200,000 188,000
Atlas Strategic Income Fund (continued)
- --------------------------------------------------------------------------------
face amount value
or units (m) (note 1)
-------------- ----------
Morocco (Government of) Loan
Participation Agreement, Tranche A,
6.44% due 01/01/09 (c) ..................... $180,000 $153,450
---------
Total Loan Participations (cost: $347,239) 341,450
---------
Corporate Bonds and Notes - 34.09%
Aerospace - .05%
Greater Toronto Airport, 5.40%
Debentures due 12/03/02 (CAD) .............. 55,000 37,111
Air Travel - .34%
Trans World Airlines, Inc., 11.50% Sr.
Sec. Notes due 12/15/04 (a) ................ 125,000 131,250
Atlas Air, Inc., 12.25% Pass-Through
Certificates due 12/01/02 (g) .............. 50,000 54,748
10.75% Sr. Notes due 08/01/05 (a) .......... 50,000 53,000
Apparel & Textiles - .20%
Indorayon International Finance Co. BV,
10% Gtd. Unsec. Unsub. Notes
due 03/29/01 (g) ........................... 100,000 49,560
Unifrax Investment Corp.,
10.50% Sr. Notes due 11/01/03 (g) .......... 50,000 52,500
William Carter Co.,
10.375% Sr. Sub. Notes
due 12/01/06 (a) ........................... 35,000 37,275
Automotive - .84%
Cambridge Industries, Inc., 10.25% Sr.
Sub. Notes due 07/15/07 (a) ................ 50,000 50,500
Collins & Aikman Products Co.,
11.50% Gtd. Sr. Sub. Notes due 04/15/06 150,000 166,875
Hayes Wheels International, Inc.,
11% Unsec. Sr. Sub. Notes due 07/15/06 ..... 100,000 112,000
9.125% Sr. Sub. Notes due 07/15/07 (a) ..... 50,000 52,500
Oxford Automotive, Inc.,
10.125% Sr. Sub. Notes due 06/15/07 (a) 200,000 206,000
Banks - 2.80%
BanAmex,
11% Cv. Jr. Sub. Notes due 07/15/03 ........ 20,000 20,546
Bank Negara Indonesia,
7.625% Sr. Notes due 02/15/07 .............. 100,000 59,000
Bayerische Vereinsbank, Series 661,
5% Sec. Bonds due 07/28/04 (DEM) ........... 795,000 447,538
Deutsche Pfandbrief & Hypobank,
Series 452, 4.75% Sec. Notes
due 03/20/03 (DEM) ......................... 700,000 391,367
Export Credit Bank of Turkey, 8.35%
Bonds due 08/18/00 (g) ..................... 250,000 242,409
Hypothekenbank In Essen AG,
Series 478, 4.50% Sec. Bonds
due 05/02/03 (DEM) ......................... 140,000 77,404
Series 459, 5.50% Sec. Bonds
due 02/20/07 (DEM) ......................... 170,000 97,889
Series 502, 5.25% Sec. Bonds
due 01/22/08 (DEM) ......................... 220,000 124,044
Industrial Bank of Japan Preferred
Capital Co. (The) LLC,
8.79% Bonds due 12/29/49 (a)(c) ............ 125,000 114,219
16 The accompanying notes are an integral part of these financial statements.
<PAGE>
- --------------------------------------------------------------------------------
Atlas Strategic Income Fund (continued)
- --------------------------------------------------------------------------------
face amount value
or units (m) (note 1)
-------------- ----------
Kreditanstalt Fuer Wiederaufbau
International Finance, 5% Bonds
due 01/04/09 (DEM) .......................... $160,000 $ 89,052
Ongko International Finance Co. BV,
10.50% Gtd. Notes due 03/29/04 (a)(b) ....... 40,000 5,850
Shoshone Partners Trust, 8% Sr. Notes
due 05/31/02 (a)(g) ......................... 250,000 276,839
Broadcast, Radio & TV - 2.49%
Adelphia Communications Corp.,
10.50% Sr. Notes due 07/15/04 (a) ........... 50,000 54,875
9.25% Sr. Notes due 10/01/02 (a) ............ 50,000 51,875
8.375% Sr. Notes due 02/01/08 (a) ........... 25,000 24,875
Azteca Holdings SA,
11% Sr. Sec. Notes due 06/15/02 (a) ......... 35,000 35,088
Capstar Broadcasting Partners, Inc.,
9.25% Sr. Sub. Notes due 07/01/07 (a) ....... 200,000 210,000
Chancellor Radio Broadcasting Co.,
8.75% Sr. Sub. Notes due 06/15/07 (a) ....... 50,000 52,000
CSC Holdings, Inc.,
10.50% Sr. Sub. Debentures
due 05/15/16 ................................ 50,000 58,375
9.875% Sr. Sub. Debentures
due 04/01/23 ................................ 50,000 55,125
EchoStar Communications Corp.,
0%/12.875% Sr. Discount Notes
due 06/01/04 (d) ............................ 100,000 97,500
EchoStar DBS Corp., 12.50% Sr. Sec.
Notes due 07/01/02 (a) ...................... 100,000 111,250
EchoStar Satellite Broadcasting Corp.,
0%/13.125% Sr. Sec. Discount Notes
due 03/15/04 (d) ............................ 100,000 91,750
Falcon Holdings Group L.P., 0%/9.285%
Debentures due 04/15/10 (a)(d) .............. 100,000 64,750
Helicon Group LP/Helicon Capital Corp.,
Series B, 11% Sr. Sec. Notes
due 11/01/03 ................................ 100,000 107,000
Jacor Communications Co., 8% Sr. Sub.
Notes due 02/15/10 .......................... 125,000 126,250
Optel, Inc., 13% Sr. Notes due 02/15/05 ..... 85,000 93,500
Paxson Communications Corp.,
11.625% Sr. Sub. Notes due 10/01/02 ......... 100,000 107,250
Rogers Communication, Inc.,
8.75% Sr. Notes due 07/15/07(CAD) ........... 100,000 68,807
TeleWest Communications PLC,
0%/11% Sr. Discount Debentures
due 10/01/07 (d) ............................ 65,000 53,950
TV Azteca SA de CV, Series A,
10.125% Sr. Notes due 02/15/04 (a) .......... 100,000 99,500
United International Holdings, Inc.,
0%/10.75% Sr. Discount Notes
due 02/15/08 (a)(d) ......................... 25,000 15,375
Young Broadcasting, Inc.,
8.75% Sr. Sub. Debentures
due 06/15/07 (a) ............................ 100,000 103,727
Series B, 9% Sr. Sub. Notes
due 01/15/06 ................................ 50,000 52,000
Building & Construction - .55%
J. Ray McDermott, SA,
9.375% Sr. Sub. Notes due 07/15/06 .......... 70,000 75,250
Kaufman & Broad Home Corp.,
.75% Sr. Notes due 10/15/04 ................. 100,000 100,000
Atlas Strategic Income Fund (continued)
- --------------------------------------------------------------------------------
face amount value
or units (m) (note 1)
-------------- ----------
Nortek, Inc., 9.125% Sr. Notes
due 09/01/07 (a) .......................... $200,000 $204,500
Building Materials - .15%
Triangle Pacific Corp.,
10.50% Sr. Notes due 08/01/03 ............. 50,000 52,000
Falcon Building Products, Inc.,
9.50% Sr. Sub. Notes due 06/15/07 (a) ..... 50,000 49,250
Capital Goods - .32%
Aki Holdings, Inc.,
10.50% Sr. Notes due 07/01/08 (a) ......... 50,000 50,250
0%/13.50% Sr. Discount Debentures
due 07/01/09 (a)(d) ....................... 50,000 26,250
Eagle-Picher Industries, 9.375% Sr. Sub.
Notes due 03/01/08 (a) .................... 100,000 101,000
Paragon Corp. Holdings, Inc.,
9.625% Sr. Notes due 04/01/08 (a) ......... 45,000 41,625
Chemicals & Allied Products - 1.05%
ClimaChem, Inc., 10.75% Gtd. Sr. Sub.
Unsec. Bonds due 12/01/07 (a) ............. 50,000 51,875
Hydrochem Industrial Service, Inc.,
10.375% Sr. Sub. Notes
due 08/01/07 (a) .......................... 50,000 51,250
Laroche Industries, Inc., 9.50% Sr. Sub.
Notes due 09/15/07 (a) .................... 100,000 97,500
NL Industries, Inc., 11.75% Sr. Sec. Notes
due 10/15/03 .............................. 40,000 44,050
PCI Chemicals Canada, Inc., 9.25% Sr.
Sec. Notes due 10/15/07 (a) ............... 50,000 48,875
Pioneer Americas Acquisition Corp.,
9.25% Sr. Sec. Notes due 06/15/07 (a) ..... 75,000 74,250
Polymer Group, Inc., 9% Sr. Sub. Notes
due 07/01/07 (a) .......................... 50,000 50,563
Sovereign Specialty Chemicals, Inc.,
9.50% Sr. Sub. Notes due 08/01/07 (a) ..... 75,000 76,500
Sterling Chemicals, Inc., 11.75% Sr.
Unsec. Sub. Notes due 08/15/06 ............ 235,000 235,000
Commercial Services - .07%
Kindercare Learning Centers, Inc., 9.50%
Sr. Sub. Notes due 02/15/09 (a) ........... 50,000 50,375
Computers - .17%
Unisys Corp., 11.75% Sr. Notes
due 10/15/04 .............................. 100,000 115,375
Conglomerates - .01%
Mechala Group Jamaica, Ltd., 12.75%
Bonds due 12/30/99 (a) .................... 7,000 7,000
Consumer Products - .63%
Holmes Products Corp., 9.875% Gtd. Sr.
Sub. Unsec. Bonds due 11/15/07 (a) ........ 25,000 25,547
Icon Health & Fitness, Inc., Series B,
13% Sr. Sub. Notes due 07/15/02 ........... 100,000 103,500
IHF Holdings, Inc., Series B, 0%/15% Sr.
Sec. Discount Notes due 11/15/04 (d) ...... 25,000 18,750
Iron Mountain, Inc.,
10.125% Sr. Sub. Notes due 10/01/06 ....... 50,000 54,750
8.75% Sr. Sub. Notes due 09/30/09 (a) ..... 50,000 51,250
Revlon Consumer Products, Inc., 8.625%
Sr. Sub. Notes due 02/01/08 (a) ........... 50,000 50,063
Revlon Worldwide Corp., 11.16% Sr. Sec.
Discount Notes due 03/15/01 (a)(f) ........ 125,000 96,875
TAG Heuer International SA, 12% Sr.
Sub. Notes due 12/15/05 (g) ............... 33,000 39,765
17
<PAGE>
Statements of Investments in Securities and Net Assets
June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Atlas Strategic Income Fund (continued)
- --------------------------------------------------------------------------------
face amount value
or units (m) (note 1)
-------------- ----------
Diversified Financial - .33%
AMRESCO, Inc.,
Series 97-A, 10% Sr. Sub. Notes
due 03/15/04 ................................ $ 75,000 $ 77,063
Series 98-A, 9.875% Sr. Sub. Notes
due 03/15/05 ................................ 100,000 101,875
Veritas Capital Trust, 10% Gtd. Bonds
due 01/01/28 (a) ............................ 50,000 52,500
Diversified Media - .65%
Chancellor Media Corp.,
10.50% Sr. Sub. Notes due 01/15/07 (a) ...... 90,000 100,125
Series B, 8.75% Sr. Sub. Notes
due 12/15/07 (a) ............................ 50,000 50,625
Hollywood Theaters, Inc., 10.625% Sr.
Sub. Notes due 08/01/07 (a) ................. 25,000 25,875
IPC Magazines Group PLC, 9.625%
Bonds due 03/15/08 (a)(GBP) ................. 50,000 78,467
Lamar Advertising Co., 9.625% Unsec. Sr.
Sub. Notes due 12/01/06 ..................... 100,000 107,000
Sinclair Broadcast Group, Inc., 8.75% Sr.
Sub. Notes due 12/15/07 ..................... 50,000 51,500
TCI Satellite Entertainment, Inc.,
10.875% Sr. Sub. Notes
due 02/15/07 (a) ............................ 25,000 24,875
0%/12.25% Sr. Discount Notes
due 02/15/07 (a) (d) ........................ 25,000 16,875
Electrical Utilities - .32%
Calpine Corp.,
10.50% Sr. Notes due 05/15/06 ............... 50,000 54,500
8.75% Sr. Notes due 07/15/07 (a) ............ 115,000 118,163
Central Termica Guemes SA, 12% Unsec.
Bonds due 11/26/01 (a)(g) ................... 50,000 49,313
Electronics - .31%
Tracor, Inc., 8.50% Sr. Sub. Notes
due 03/01/07 (a) ............................ 100,000 108,500
Wavetek Corp., 10.125% Sr. Sub. Notes
due 06/15/07 (a) ............................ 100,000 104,000
Energy Services & Producers - 1.15%
Gothic Energy Corp., Units (each unit
consists of $1,000 principal amount of
0%/14.125% Sr. Discount Notes due
05/01/06 and 7.933 warrants to purchase
one ordinary share) (a)(d)(k) ............... 125,000 72,500
Gothic Production Corp.,
11.125% Sr. Sec. Notes due 05/01/05 (a) ..... 50,000 47,875
Grant Geophysical, Inc., 9.75% Sr. Notes
due 02/15/08 (a) ............................ 100,000 98,500
Great Lakes Carbon Corp., 10.25% Sr.
Sub. Notes due 05/15/08 (a) ................. 150,000 153,000
P&L Coal Holdings Corp., 9.625% Sr.
Sub. Notes due 05/15/08 (a) ................. 100,000 102,750
Ram Energy, Inc., 11.5% Sr. Notes
due 02/15/08 ................................ 200,000 201,000
Universal Compression, Inc., 0%/9.875%
Sec. Discount Notes due 02/15/08 (a) ........ 200,000 126,000
Environmental - .26%
Allied Waste Industries, Inc.,
0%/11.30% Sr. Discount Notes
due 06/01/07 (a)(d) ......................... 100,000 73,000
10.25% Sr. Sub. Notes due 12/01/06 (a) ...... 100,000 109,500
Atlas Strategic Income Fund (continued)
- --------------------------------------------------------------------------------
face amount value
or units (m) (note 1)
-------------- ----------
Financial - .87%
BankUnited Financial Corp.,
10.25% due 12/31/26 (a) .................... $100,000 $107,750
CB Richard Ellis Service, 8.875% Unsec.
Sr. Sub. Notes due 06/01/06 ................ 50,000 49,625
Ford Motor Credit Co.,
5.25% Bonds due 06/16/08 (DEM) ............. 360,000 198,817
Local Financial Corp.,
11% Sr. Notes due 09/08/04 (a) ............. 50,000 54,250
Netia Holdings BV, .........................
10.25% Sr. Gtd. Notes due 11/01/07 (a) ..... 25,000 24,031
0%11% Sr. Gtd. Discount Notes due
11/01/07 (a) (d) ........................... 50,000 18,699
Polytama International Finance BV,
11.25% Sec. Notes due 06/15/07 (b) ......... 50,000 21,063
SBS Agro Finance BV, 10.25% Bonds
due 07/21/00 ............................... 75,000 57,375
Southern Pacific Funding Corp.,
11.50% Sr. Notes due 11/01/04 .............. 75,000 74,250
Food & Beverages - .75%
Aurora Foods, Inc., 8.75% Sr. Sub. Notes
due 07/01/08 (a) ........................... 100,000 100,000
Del Monte Foods Co., 0%12.50% Sr.
Discount Notes due 12/15/07 (a)(d) ......... 50,000 32,500
Doane Products Co.,
10.625% Sr. Notes due 03/01/06 (g) ......... 100,000 109,000
Favorite Brands International, Inc.,
10.75% Sr. Notes due 05/15/06 (a) .......... 50,000 50,500
Purina Mills, Inc.,
9% Sr. Sub. Notes due 03/15/10 (a) ......... 50,000 51,375
Shoppers Food Warehouse Corp.,
9.75% Sr. Sec. Notes due 06/15/04 (a) ...... 20,000 22,100
Smithfield Foods, Inc.,
7.625% Sr. Sub. Notes due 02/15/08 (a) ..... 100,000 101,000
Sparkling Spring Water, 11.50% Sr. Sub.
Notes due 11/15/07 (a) ..................... 50,000 52,250
Gas Utilities - .08%
AmeriGas Partners, L.P., 10.125% Sr.
Notes due 04/15/07 (a) ..................... 50,000 54,063
Health Care/Supplies & Services -
1.11% Integrated Health Services,
9.50% Sr. Sub. Notes due 09/15/07 (a) ...... 125,000 130,625
Fresenius Medical Cap Trust II,
7.875% Gtd. Sec. Trust Preferred Bond
due 02/01/08 (a) ........................... 100,000 98,250
Fresenius Medical Cap Trust III,
7.375% Gtd. Sec. Trust Preferred Bonds
due 02/01/08 (a)(DEM) ...................... 100,000 54,572
Fresenius Medical Care AG,
9% Unsec. Trust Preferred due 12/01/06 ..... 120,000 124,800
Kinetic Concepts, Inc., Series B, 9.625%
Sr. Unsec. Sub. Notes due 11/01/07 (a) ..... 175,000 176,750
Oxford Health Plans,
11% Sr. Notes due 05/15/05 (a) ............. 100,000 102,500
Sun Healthcare Group, Inc.,
9.50% Sr. Sub. Notes due 07/01/07 (a) ...... 85,000 86,275
Homebuilders/Real Estate - .21% .............
Saul (B.F.) Real Estate Investment Trust,
9.75% Sr. Sec. Notes due 04/01/08 .......... 150,000 148,125
18 The accompanying notes are an integral part of these financial statements.
<PAGE>
- --------------------------------------------------------------------------------
Atlas Strategic Income Fund (continued)
- --------------------------------------------------------------------------------
face amount value
or units (m) (note 1)
-------------- ----------
Hotel/Gaming - 1.59%
Apcoa, Inc., 9.25% Sr. Sub. Notes
due 03/15/08 (a) ........................... $ 50,000 $ 49,625
Capstar Hotel Co., 8.75% Sr. Sub.
Notes due 08/15/07 (a) ..................... 25,000 25,938
Casino Magic of Louisiana Corp.,
Series B, 13% due 08/15/03 ................. 40,000 46,000
Empress Entertainment, Inc.,
8.125% Sr. Sub. Notes due 07/01/06 ......... 150,000 150,375
Grand Casinos, Inc., 10.125% Gtd.
First Mtg. Notes due 12/01/03 .............. 50,000 54,750
Hard Rock Hotel, Inc., 9.25% Sr. Sub.
Notes due 04/01/05 (a) ..................... 90,000 92,250
HMH Properties, Inc., 8.875% Sr.
Notes due 07/15/07 (a) ..................... 100,000 111,500
Horseshoe Gaming LLC, 9.375% Sr. Sub.
Notes due 06/15/07 (a) ..................... 75,000 79,406
Majestic Star Casino LLC (The),
12.75% Sec. Sr. Notes due 05/15/03 ......... 50,000 54,625
Mohegan Tribal Gaming Authority
(Connecticut), Series B,
13.50% Sr. Sec. Notes due 11/15/02 ......... 50,000 63,000
Rio Hotel and Casino, Inc., 9.50% Gtd.
Sr. Sub. Notes due 04/15/07 (a) ............ 100,000 104,750
Showboat Marina Casino
Partnership/Showboat
Marina Finance Corp.,
Series B, 13.50% First Mtg. Notes
due 03/15/03 ............................... 150,000 174,750
Venetian Casino Resort LLC/
Las Vegas Sands, Inc.,
12.25% First Mtg. Notes
due 11/15/04 (a) ........................... 50,000 51,625
10%/14.25% Sr. Sub. Notes
due 11/15/05 (a)(e) ........................ 50,000 46,250
Industrial - 1.68%
Federal-Mogul Corp.,
7.875% Notes due 07/01/10 .................. 125,000 124,693
Fleming Companies, Inc.,
10.50% Sr. Sub. Notes due 12/01/04 (a) ..... 75,000 78,000
10.625% Sr. Sub. Notes
due 07/31/07 (a) ........................... 200,000 208,500
Focal Communications, Inc.,
0%/12.125% Sr. Discount Notes
due 02/15/08 (a)(d) ........................ 300,000 178,875
Insilco Corp., 10.25% Sr. Sub.
Notes due 08/15/07 (a) ..................... 25,000 26,125
International Wire Group, Inc., Series B,
11.75% Sr. Sub. Notes
due 06/01/05 (a) ........................... 65,000 71,256
Key Plastics, Inc., 10.25% Sr. Sub. Notes
due 03/15/07 (a) ........................... 50,000 52,000
Outboard Marine Corp., 10.75% Sr.
Notes due 06/01/08 (a) ..................... 100,000 101,000
Pantry, Inc. (The), 10.25% Sr. Sub. Notes
due 10/15/07 (a) ........................... 50,000 51,000
Phillips Van-Huesen, 9.50% Sr. Sub.
Notes due 05/01/08 (a) ..................... 100,000 99,875
Roller Bearing Co. of America, Inc.,
9.625% Sr. Sub. Notes due 06/15/07 (a) ..... 25,000 25,563
Atlas Strategic Income Fund (continued)
- --------------------------------------------------------------------------------
face amount value
or units (m) (note 1)
-------------- ----------
Shaw Communications, Inc., 8.54%
Debentures due 09/30/27 (CAD) .............. $ 80,000 $ 54,509
Styling Technology Corp., 10.875% Sr.
Sub. Notes due 07/01/08 (a) ................ 50,000 50,750
Trico Marine Services, Inc., 8.50% Gtd.
Sr. Sub. Unsec. Bonds due 08/01/05 (a) ..... 20,000 19,450
UIH Australia/Pacific, Series B, 0%/14%
Sr. Discount Notes due 05/15/06 (d) ........ 50,000 30,563
Industrial Services - .22%
Comforce Operating, Inc.,
12% Sr. Notes due 12/01/07 (a) ............. 50,000 53,500
Fisher Scientific International, Inc.,
9% Sr. Sub. Notes due 02/01/08 (a) ......... 100,000 99,250
Information Technology - 3.34%
Amazon Communications, Inc., 0%/10%
Sr. Discount Notes due 05/01/08 (a)(d) ..... 100,000 60,750
American Mobile Satellite Corp./AMSC
Acquisition Co. Inc., Units (each unit
consists of $1,000 Principal amount of
12.25% Sr. Notes due 04/01/08 and one
warrant to purchase 3.75749 ordinary
shares) (a)(k) ............................. 50,000 47,000
Bell Technology Group, Units (each unit
consists of $1000 principal amount of
13% Sr. Notes due 05/01/05 and one
warrant to purhcase one ordinary
share) (a)(k) .............................. 50,000 50,500
Cellnet Data Systems, Inc.,
0%/14% Unsec. Sr. Discount Notes
due 10/01/07 (d) ........................... 50,000 27,750
Cellular Communications International,
Inc., 0%/9.50% Sr. Discount Notes
due 04/01/05 (ECU)(a)(d) ................... 250,000 179,375
Covad Communication Group, Inc.,
Units (each unit consists of $1,000
principal amount of 0%/13.50% Sr.
Discount Notes due 03/15/08 and one
warrant to purchase 6.4792 shares
of common stock) (a)(d)(k) ................. 100,000 52,000
Crown Castle International Corp.,
0%/10.625% Sr. Discount Notes
due 11/15/07 (a)(d) ........................ 75,000 51,188
CTI Holdings SA, 0%/11.50% Sr. Notes
due 04/15/08 (a)(d) ........................ 50,000 27,750
Details, Inc., 10% Sr. Sub. Notes
due 11/15/05 (a) ........................... 25,000 24,875
Exodus Communications, Inc., 11.25 Sr.
Notes due 07/01/08 (a) ..................... 100,000 100,000
Global Crossing Holdings, Ltd.,
9.625% Sr. Notes due 05/15/08 (a) .......... 100,000 104,125
GST Telecommunications, Inc./GST
Network Funding Inc., 75,000
0%/10.25% Sr. Discount Notes due
05/01/08 (a)(d) ............................ 75,000 45,000
ICG Services, Inc., 0%/10% Sr. Discount
Notes due 02/15/08 (a)(d) .................. 60,000 35,550
Iridium LLC/Iridium Capital Corp.,
11.25% Sr. Notes due 07/15/05 (a) .......... 15,000 15,038
13% Sr. Gtd. Notes due 07/15/05 (a) ........ 25,000 26,813
19
<PAGE>
Statements of Investments in Securities and Net Assets
June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Atlas Strategic Income Fund (continued)
- --------------------------------------------------------------------------------
face amount value
or units (m) (note 1)
-------------- ----------
KMC Telecom Holdings, Inc.,
Units (each unit consists of $1000
principal amount of 0%/12.50% Sr.
Discount Notes due 02/15/08 and
one warrant to purchase
.21785 Ordinary Share of Common
Stock) (a)(k) ............................. $100,000 $ 58,000
Nextel Communications, Inc.,
Sr. Discount Notes,
0%/10.65% due 09/15/07 (a)(d) ............. 600,000 403,500
0%/9.95% due 02/15/08 (a)(d) ............. 75,000 47,906
0%/9.75% due 10/31/07 (a)(d) ............. 125,000 81,250
Nextlink Communications, Inc.,
9.625% Sr. Notes due 10/01/07 ............. 125,000 128,125
9.% due 03/15/08 (a) ...................... 100,000 100,000
0%/ 9.45% Sr. Discount Notes
due 04/15/08 (a)(d) ....................... 100,000 61,125
Orbital Imaging Corp., Units (each unit
consists of $1,000 principal amount of
11.625% Sr. Notes due 03/01/05 and one
warrant to purchase 8.7516 ordinary
shares) (a)(k) ............................ 75,000 80,063
Pinnacle Holdings, Inc., 10% Sr.
Discount Notes due 03/15/08 (a) ........... 100,000 65,500
Psinet, Inc., 10% Senior Notes
due 02/15/05 (a) .......................... 150,000 153,000
Satelites Mexicanos SA, 10.125% Sr.
Notes due 11/01/04 (a) .................... 50,000 48,688
SBA Communications Corp., 0%/12% Sr.
Discount Notes due 03/01/08 (a)(d) ........ 200,000 125,000
Wam!Net, Inc., Units (each unit consists
of $1,000 principal amount of
0%/13.25% Sr. Discount Notes due
03/01/05 and three warrants to
purchase 6.03 ordinary shares of
common stock) (a)(d)(k) ................... 200,000 126,000
Insurance - .10%
Veritas Holdings, GMBH, 9.625% Sr.
Notes due 12/15/03 (a) .................... 65,000 68,413
Leisure & Entertainment - .42%
Premier Cruise, Ltd., 11% Sr. Notes due
03/15/08 (a) .............................. 50,000 33,250
Premier Parks, Inc., ......................
9.25% Sr. Notes due 04/01/06 .............. 50,000 51,625
0%/10% Sr. Discount Notes
due 04/01/08 (d) .......................... 50,000 33,188
SFX Entertainment, Inc., 9.125% Sr. Sub.
Notes due 02/01/08 (a) .................... 125,000 122,500
Six Flags Entertainment Corp., 8.875%
Sr. Notes due 04/01/06 .................... 50,000 50,938
Manufacturing - .37%
Grove Worldwide LLC, 9.25% Sr. Sub.
Notes due 05/01/08 (a) .................... 50,000 49,750
Moll Industries, Inc., 10.50% Sr. Sub.
Notes due 07/01/08 (a) .................... 100,000 102,000
SC International Services, Inc., 9.25% Sr.
Sub. Notes due 09/01/07 (a) ............... 100,000 103,500
Atlas Strategic Income Fund (continued)
- --------------------------------------------------------------------------------
face amount value
or units (m) (note 1)
-------------- ----------
Metals/Mining - .49%
Centaur Mining & Exploration, Ltd.,
11% Gtd. Sr. Notes due 12/01/07 (a)(g) ..... $ 25,000 $ 25,500
International Utility Structures, Inc.,
10.75% Sr. Sub. Notes due 02/01/08 (a) ..... 25,000 25,500
Kaiser Aluminum & Chemical Corp.,
12.75% Sr. Sub. Notes due 02/01/03 ......... 50,000 53,375
Metallurg, Inc., 11% Sr. Notes
due 12/01/07 (a) ........................... 225,000 235,125
Oil & Gas - 1.31%
Belden & Blake Energy Co. LP, 9.875%
Sr. Sub. Notes due 06/15/07 (a) ............ 100,000 97,750
Chesapeake Energy Corp., 9.625% Sr.
Notes due 05/01/05 (a) ..................... 100,000 100,250
Dailey International, Inc., 9.50% Sr.
Unsec. Notes due 02/15/08 (a) .............. 100,000 97,500
Denbury Management, Inc., 9% Sr. Sub.
Notes due 03/01/08 ......................... 150,000 143,250
DI Industries, Inc., 8.875% Sr. Notes
due 07/01/07 ............................... 20,000 19,400
Forcenergy, Inc.,
8.50% Sr. Sub. Notes due 02/15/07 (a) ...... 50,000 47,500
9.50% Unsec. Sr. Sub. Notes
due 11/01/06 ............................... 100,000 100,250
Ocean Rig Norway AS, 10.25% Sr. Sec.
Gtd. Notes due 06/01/08 (a) ................ 100,000 95,000
Parker Drilling Co., Series B, 9.75% Sr.
Notes due 11/15/06 ......................... 100,000 102,250
Stone Energy Corp., 8.75% Sr. Sub. Notes
due 09/15/07 (a) ........................... 110,000 110,825
Paper & Forest Products - .81%
Fletcher Challenge, Ltd.,
8.05% Bonds due 06/15/03(NZD) .............. 30,000 15,226
14.50% Cv. Sub. Notes
due 09/30/00(NZD) .......................... 85,000 49,207
10% Cv. Unsec. Sub. Notes
due 04/30/05(NZD) .......................... 5,000 2,799
Florida Coast Paper Co. LLC,
Series B, 12.75% First Mtg. Notes
due 06/01/03 ............................... 110,000 122,375
Four M Corp., 12% Sr. Sec. Notes
due 06/01/06 (a)(g) ........................ 25,000 26,750
Pacific Lumber Co., 10.50% Sr. Unsec.
Notes due 03/01/03 ......................... 50,000 51,375
Riverwood International Corp., 10.625%
Sr. Notes due 08/01/07 (a) ................. 100,000 104,000
SD Warren Co., Series B, 12% Sr. Sub.
Notes due 12/15/04 ......................... 150,000 165,938
U.S. Timberland Co. LP, 9.625% Sr.
Notes due 11/15/07 ......................... 25,000 25,781
Restaurants - .36%
Ameriking, Inc., 10.75% Sr. Unsec. Notes
due 12/01/06 ............................... 150,000 160,500
Carrols Corp., 11.50% Sr. Notes
due 08/15/03 ............................... 85,000 89,038
Retail - .14%
Boyd Collection, Ltd., 9% Sr. Sub. Notes
due 05/15/08 (a) ........................... 100,000 100,000
20 The accompanying notes are an integral part of these financial statements.
<PAGE>
- --------------------------------------------------------------------------------
Atlas Strategic Income Fund (continued)
- --------------------------------------------------------------------------------
face amount value
or units (m) (note 1)
-------------- ----------
Security Services - .25%
Borg-Warner Security Corp., 9.625% Sr.
Sub. Notes due 03/15/07 (a) ................ $ 50,000 $ 56,000
Protection One Alarm Monitoring, Inc.,
6.75% Cv. Gtd. Sr. Sub. Notes
due 09/15/03 ............................... 100,000 116,250
Specialty Retailing - .25%
Eye Care Centers of America, Inc.,
9.125% Sr. Sub. Notes due 05/01/08 (a) ..... 75,000 74,625
Finlay Fine Jewelry Corp., 8.375% Sr.
Notes due 05/01/08 ......................... 50,000 50,188
Home Interior & Gifts, Inc., 10.125% Sr.
Sub. Notes due 06/01/08 (a) ................ 50,000 51,063
Steel - .38%
AK Steel Corp., 9.125% Sr. Notes
due 12/15/06 ............................... 100,000 104,500
Algoma Steel, Inc., 12.375% Sec. First
Mtg. Notes due 07/15/05 .................... 25,000 28,000
Bar Technologies, Inc., 13.50% Sr. Sec.
Notes due 04/01/01 ......................... 25,000 26,813
Keystone Consolidated Industries, Inc.,
9.625% Sr. Sec. Notes due 08/01/07 (a) ..... 100,000 102,250
Supermarkets - .27%
Pathmark Stores, 0%/10.75% Jr. Sub.
Notes due 11/01/03 (d) ..................... 100,000 84,000
Randall's Food Markets, Inc., 9.375% Sr.
Sub. Notes due 07/01/07 (a) ................ 100,000 105,500
Telecommunications - 5.47%
Arch Communications, Inc., 12.75% Sr.
Notes due 07/01/17 (a) ..................... 100,000 100,625
Call-Net Enterprises, Inc.,
0%/9.27% Sr. Discount Notes
due 08/15/07 ............................... 50,000 35,000
Clearnet Communications, Inc.,
0%/14.75% Sr. Unsec. Discount Notes
due 12/15/05 (d) ........................... 75,000 62,813
Colt Telecom Group PLC,
Units (each unit consists of $1,000
principal amount of 0%/12% Unsec. Sr.
Discount Notes due 12/15/06 and one
warrant to purchase 7.80 ordinary
shares) (d)(k) ............................. 100,000 99,000
0%/12% Unsec. Sr. Discount Notes
due 12/15/06 ............................... 50,000 39,000
10.125% Sr. Notes due 11/30/07 (GBP) ....... 35,000 104,870
8.875% Sr. Notes due 11/30/07 (GBP) ........ 25,000 15,485
Comunicacion Celular SA, 0%/13.125%
Sr. Deferred Coupon Bonds
due 11/15/03 (d) ........................... 100,000 77,000
Convergent Communication, Inc., Units
(each unit consists of $1,000 principal
amount of Sr. Notes and four warrants
to purchase 10.8 shares of common
stock) (a)(k) .............................. 50,000 48,000
Diamond Cable Communications PLC,
0%/11.75% Sr. Discount Notes
due 12/15/05 (d) ........................... 200,000 165,000
E. Spire Communications, Inc., 13.75%
Unsec. Sr. Notes due 07/15/07 ............ 25,000 28,500
Facilicom International, Inc., 10.50% Sr.
Notes due 01/15/08 (a) ..................... 175,000 172,375
Atlas Strategic Income Fund (continued)
- --------------------------------------------------------------------------------
face amount value
or units (m) (note 1)
-------------- ----------
Firstworld Communication, Inc., Units
(each unit consists of $1,000 principal
amount of 13% Sr. Discount Notes
due 04/15/08 and one warrant to
purchase 7.9002 shares of Series B,
common stock) (a) ........................ $100,000 $ 44,000
GST USA, Inc., 0%/13.875% Gtd. Sr. Sec.
Discount Notes due 12/15/05 (d) .......... 75,000 60,750
Intermedia Communications, Inc.,
8.875% Sr. Notes due 11/01/07 (a) ........ 75,000 76,688
8.50% Sr. Notes due 01/15/08 (a) ......... 75,000 75,000
8.60% Sr. Notes due 06/01/08 (a) ......... 100,000 101,250
Level 3 Communications, Inc., 9.125%
Unsec. Sr. Notes due 05/01/08 (a) ........ 150,000 146,063
Long Distance International, Inc., Units
(each unit consists of $1,000 principal
amount of 12.25% Sr. Notes due
04/15/08 and one warrant to purchase
15.0874 shares of common stock) (a) ...... 50,000 49,500
McLeodUSA, Inc.,
0%/10.50% Sr. Discount Notes due
03/01/07 (a)(d) .......................... 50,000 37,500
8.375% Sr. Notes due 03/15/08 (a) ........ 100,000 100,250
9.25% Sr. Notes due 07/15/07 (a) ......... 40,000 41,500
Metrocall, Inc., 10.375% Sr. Sub. Notes
due 10/01/07 ............................. 50,000 51,750
Metronet Communications Corp.,
0%/10.75% Sr. Discount Notes
due 11/01/07 (a)(d) ...................... 75,000 49,219
0%/9.95% Sr. Discount Notes
due 06/15/08 (a)(d) ...................... 25,000 15,469
Microcell Telecommunications, Inc.,
0%/10.125% Sr. Discount Notes
due 10/15/07 (a)(d) CAD .................. 100,000 43,011
Millicom International Cellular SA,
0%/13.50% Sr. Discount Notes
due 06/01/06 (d) ......................... 60,000 46,350
NTL, Inc.,
10% Sr. Notes due 02/15/07 (a) ........... 100,000 107,500
0%/9.75% Sr. Notes due 04/01/08 (a) ...... 100,000 65,000
10.75% Sr. Unsec. Unsub. Notes
due 04/01/08 GBP ......................... 50,000 52,589
Onepoint Communication Corp., Units
(each unit consists of $1,000 principal
amount of 14.25% Sr. Notes due
06/01/08 and one warrant to purchase
.635 shares of common stock) (a)(k) ...... 50,000 47,000
Omnipoint Corp., Series A, 11.625% Sr.
Notes due 08/15/06 ....................... 150,000 157,875
ORBCOMM Global LP/ORBCOMM
Capital Corp., Series B, 14% Sr. Notes
due 08/15/04 ............................. 150,000 169,875
Orion Networks Systems, Inc.,
0%/12.50% Sr. Discount Notes due
01/15/07 (d) ............................. 200,000 153,000
Petersburg Long Distance, Inc., Units
(each unit consists of $1,000 principal
amount of 0%/14% Sr. Discount Notes
due 06/01/04 and one warrant to
purchase 34 ordinary shares) (a)(d)(k) 50,000 46,500
21
<PAGE>
Statements of Investments in Securities and Net Assets
June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Atlas Strategic Income Fund (continued)
- --------------------------------------------------------------------------------
face amount value
or units (m) (note 1)
-------------- -------------
Price Communication Cellular Holdings,
Inc., 0%/13.50% Sr. Discount Notes
due 08/01/07 (a)(d) ........................ $150,000 $ 104,625
Price Communication Wireless, Inc.,
9.125% Sec. Notes due 12/15/06 (a) ......... 100,000 99,875
11.75% Unsec. Sr. Sub. Notes
due 07/15/07 ............................... 50,000 55,000
PTC International Finance BV,
0%/10.75% Unsec. Sub. Notes
due 07/01/07 (a) ........................... 34,000 23,163
Qwest Communications International,
Inc., 0%/9.47% Sr. Sub. Notes
due 10/15/07 (a)(d) ........................ 150,000 112,125
RSL Communications PLC,
0%/10.125% Sr. Discount Notes
due 03/01/08 (a) (d) ....................... 100,000 59,500
0%/10% Bonds
due 03/15/08 (d) (DEM) ..................... 50,000 17,729
Rural Cellular Corp., 9.625% Sr. Sub.
Notes due 05/15/08 (a) ..................... 100,000 100,000
Spectrasite Holdings, Inc., 0%/12% Sr.
Discount Notes due 07/15/08 (a)(d) ......... 200,000 111,000
Teleport Communications Group, Inc.,
0%/11.125% Sr. Discount Notes
due 07/01/07 (d) ........................... 200,000 174,000
USA Mobile Communications, Inc. II,
9.50% Sr. Notes due 02/01/04 ............... 100,000 90,750
14% Sr. Notes due 11/01/04 ................. 65,000 71,500
Viatel, Inc., Units (each unit consists of
$1,000 principal amount of 11.25%
due 04/15/08 and .483 shares of
Series A, preferred stock) (a)(k) .......... 100,000 104,500
Telephone Utilities - .04%
Telecomunicacoes Brasileiras SA,
11.301% Medium-Term Notes
due 12/09/99 (a)(c)(g) ..................... 30,000 30,413
Textile/Apparel - .14%
Galey & Lord, Inc., 9.125% Sr. Sub.
Notes due 03/01/08 (a) ..................... 100,000 96,500
Transportation - .75%
American Communication Lines
LLC/ACL, 10.25% Bonds
due 06/30/08 (a) ........................... 50,000 50,000
Coach USA, Inc., 9.375% Sr. Sub. Notes
due 07/01/07 (a) ........................... 75,000 78,000
Navigator Gas Transportation PLC,
10.50% First Priority Ship Mtg. Notes
due 06/30/07 (a) ........................... 75,000 78,188
Units (each unit consists of $1,000
principal amount of 12% second priority
ship mtg. notes due 06/30/07 and
7.66 warrants) (k) ......................... 50,000 56,500
TFM SA de CV, 10.25 Sr. Gtd. Bonds
due 06/15/07 (a) ........................... 75,000 72,750
Transtar Holdings LP/Transtar Capital
Corp., Series B, 0%/13.375%
Sr. Discount Notes due 12/15/03 (d) ........ 200,000 186,000
------------
Total Corporate Bonds and Notes (cost: $23,407,157) 23,727,328
------------
Atlas Strategic Income Fund (continued)
- --------------------------------------------------------------------------------
face amount value
or units (m) (note 1)
-------------- ------------
Common Stocks - 0.00%
Optel, Inc. Exp 02/15/05 (b)(g) ........... 85 $ 1
-----------
Total Common Stocks (cost: $0) 1
-----------
Shares
------
Preferred Stock - 2.59%
CBS Radio, Inc., Series B,
11.375% Cum. Exchangeable (g)(i) ......... 752 89,300
Chesapeake Energy Corp., 7% (a) ........... 2,000 84,250
Concentrix Network Corp., 13.50% (a) ...... 50 49,750
E. Spire Communications, Inc., 12.75% ..... 51 55,463
Eagle-Picher Holdings,
0%/11.75% Cum. (a)(d)(g) ................. 1,000 58,000
Echostar Communications Corp.,
12.125% Exchangeable (a)(g)(i) ........... 52 57,980
El Paso Electric Co., Series A,
11.40% Cum. (i) .......................... 805 88,148
ICG Holdings, Inc., 14.25% (g)(i) ......... 27 32,805
Nebco Evans Holdings Co.,
11.25% (a)(i) ............................ 1,026 104,652
Nextel Communications, Inc., Series E,
11.125% (a)(i) ........................... 51 52,996
NEXTLINK Communications, Inc.,
14% Cum. Exchangeable (i) ................ 4,569 267,287
Paxson Communications Corp.,
13.25% (a) ............................... 50 49,250
Prime Retail, Inc., Series B, 8.50% Cv. 500 10,250
PRIMEDIA, Inc., ........................... 100
Series E, 9.20% (a) ...................... 100 10,150
Series G, 8.625% Exchangeable (a) ........ 3,000 291,750
Rural Cellular Corp., 11.375% (a)(g) ...... 50 50,125
S.D. Warren Co., Series B, 14% Cum.
Exchangeable (b) ......................... 5,500 275,000
S.F. Holdings Group, Inc., Units
(each Unit consist of one 13.75%
Preferred Stock and 37 Class C Shares of
Common Stock) (a)(g)(i)(k) ............... 10,000 87,750
SFX Broadcasting, Inc., Series E,
12.625% Cum. (i) ......................... 531 60,003
Spanish Broadcasting Systems, Inc.,
14.25% Cum. Exchangeable (a)(g)(i) ....... 27 28,418
-----------
Total Preferred Stocks (cost: $1,758,035) 1,803,327
-----------
22 The accompanying notes are an integral part of these financial statements.
<PAGE>
- --------------------------------------------------------------------------------
Atlas Strategic Income Fund (continued)
- --------------------------------------------------------------------------------
value
Units (note 1)
-------------- ----------
Rights, Warrants and Certificates - 0.04% (b)
Comunicacion Celular SA Wts.,
Exp. 11/03 (g) ......................... 100 $ 7,700
Gothic Energy Corp. Wts., Exp. 09/04 .... 1,400 1,400
Gothic Energy Corp. Wts., Exp. 09/04 .... 1,303 13
NEXTLINK Communications, Inc. Wts.,
Exp. 02/09 ............................. 1,235 0
Occidente Y Caribe Celular SA Wts.,
Exp. 03/04 (g) ......................... 400 8,000
Orbital Imaging Corp. Wts., Exp 03/05 75 -
Orion Network Systems, Inc. Wts.,
Exp 01/07 (g) .......................... 100 1,313
Price Communication Corp. Wts.,
Exp 08/07 (g) .......................... 516 7,805
Republic of Venezuela Wts., Exp 04/20 1,250 0
United Mexican States Bonds Wts.,
Exp. 06/03 ............................. 250,000 0
---------
Total Rights, Warrants and Certificates (cost: $12,264) 26,231
---------
face amount
or units (m)
-------------
Structured Instruments - 4.21%
Bear Stearns High Yield Composite Index
Linked Notes,
9% due 08/25/98 ........................ $ 250,000 250,000
9% due 10/13/98 ........................ 300,000 300,000
Deutsche Morgan Grenfell,
OFZ Linked Notes,
due 02/23/00 ........................... 80,000 51,858
due 10/25/00 ........................... 80,000 51,761
Lehman Brothers Holdings, Chilean
Peso/Japanese Yen Linked Notes,
18% due 07/28/98 ....................... 70,000 72,673
17.50% due 07/28/98 .................... 70,000 71,861
Lehman Brothers Holdings, Inc.,
Zero Coupon, Greek Drachma/European
Currency Unit Linked Notes,
due 03/22/99 ........................... 70,000 70,000
Zero Coupon, Greek Drachma/Swiss
Franc Linked Notes due 03/31/99 ........ 45,000 45,000
Lehman High Yield Index Notes,
8.4375% due 08/05/98 ................... 200,000 200,000
8.50% due 03/08/99 ..................... 400,000 400,000
Salomon Brothers, Inc.,
6% Brazil Linked Notes, due 04/02/03 150,000 123,315
10% Zero Coupon Russian Linked Notes
due 07/31/98 (f) ....................... 100,000 97,990
10% Zero Coupon Russian Linked Notes
due 08/07/98 (f) ....................... 330,000 320,265
12.02% United Mexican States 16' Linked
Notes, due 09/16/98 .................... 657,875 647,547
12.33% United Mexican States 26' Linked
Notes, due 09/16/98 .................... 97,477 97,058
Atlas Strategic Income Fund (continued)
- --------------------------------------------------------------------------------
face amount value
or units (m) (note 1)
-------------- ------------
Standard Chartered Bank,
20.25% Philippine Peso/Japanese Yen
Linked Notes due 11/09/98 ............ $70,000 $ 70,791
48% Thailand Baht/Japanese Yen Linked
Notes due 08/11/98 ................... 60,000 59,268
-----------
Total Structured Instruments (cost: $2,997,063) 2,929,387
-----------
strike
date price contracts/face
------- -------------- ---------------
Call Options Purchased - 0.03%
Deutsche Mark Call
Option .............. 10/98 0.840 DEM 250,000 1,221
U.S. Treasury Bonds,
6.125% due 11/15/27
Call Option ......... 11/98 $ 107.125 600 16,248
-------
Total Call Options Purchased (cost: $7,600) 17,469
-------
Put Options Purchased - 0.08%
Japanese Yen Put Option 09/98 136.000 JPY 105,410,000 49,437
Japanese Yen Put Option 09/98 145.400 JPY 51,220,000 5,737
U.S. Treasury Bonds,
6.125% due 11/15/27
Put Option ........... 07/98 $ 105.695 600 3,384
-------
Total Put Options Purchased (cost: $24,641) 58,558
-------
face amount (m)
----------------
Short-Term Securities - 1.00%
Triparty Repurchase Agreement dated June
30, 1998 with Prudential Securities, Inc.,
effective yield of 5.32%, due July 1, 1998,
collateralized by FHLMC, 6.773%, August
1, 2025 with a value of $712,749 ........... $ 698,512 698,512
------------
Total Short-Term Securities (cost: $698,512) 698,512
------------
Total Investments (cost: $73,285,243) - 105.47% 73,417,990
Other Assets and Liabilities, Net - (5.47)% (3,805,234)
------------
Net Assets - 100.00% $ 69,612,756
============
23
<PAGE>
Statements of Investments in Securities and Net Assets
June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Atlas Balanced Fund
- --------------------------------------------------------------------------------
shares or value
face amount (note 1)
------------- -------------------
Common Stocks - 34.95%
Aerospace/Defense - .01%
Raytheon Co., Cl. A .................... 191 $ 11,006
Automotive - .43%
Ford Motor Co. ......................... 4,000 236,000
General Motors Corp. ................... 2,000 133,625
Banks - 12.44%
Banc One Corp. ......................... 12,100 675,331
Bank of Boston Corp. ................... 14,000 778,750
BankAmerica Corp. ...................... 10,000 864,375
Capital One Financial Corp. ............ 6,000 745,125
Chase Manhattan Corp. .................. 14,000 1,057,000
Citicorp ............................... 5,000 746,250
Crestar Financial Corp. ................ 8,000 436,500
First Chicago Corp. .................... 8,000 709,000
First Union Corp. ...................... 21,000 1,223,250
Fleet Financial Group, Inc. ............ 7,000 584,500
Keycorp ................................ 8,000 285,000
Mellon Bank Corp. ...................... 10,000 696,250
National City Corp. .................... 4,000 284,000
NationsBank Corp. ...................... 8,312 635,868
PNC Bank Corp. ......................... 8,000 430,500
Summit Bancorp. ........................ 10,000 475,000
Chemicals & Allied Products - .90%
BetzDearborn, Inc. ..................... 5,000 210,938
Dexter Corp. ........................... 8,000 254,500
Lyondell Petrochemical Co. ............. 9,904 301,453
Consumer Goods & Services - .41%
Newell Co. ............................. 7,000 348,688
Drugs and Health Care - 1.77%
American Home Products Corp. ........... 4,000 207,000
Bristol-Myers Squibb Co. ............... 3,500 402,281
Crescendo Pharmaceuticals Corp. ........ 145 1,840
Merck & Co., Inc. ...................... 5,000 668,750
Pharmacia & Upjohn, Inc. ............... 5,000 230,625
Electrical Utilities - 2.23%
American Electric Power Co. ............ 2,500 113,438
Central & South West Corp. ............. 7,000 188,125
Florida Progress Corp. ................. 4,000 164,500
Illinova Corp. ......................... 12,000 360,000
New Century Energies, Inc. ............. 3,000 136,313
Potomac Electric Power Co. ............. 6,000 150,375
SCANA Corp. ............................ 6,000 178,875
Texas Utilities Co. .................... 8,000 333,000
Unicom Corp. ........................... 8,000 280,500
Electronics - .28%
AMP, Inc. .............................. 7,000 240,625
Financial Services - 3.04%
Associates First Capital Corp. ......... 1,048 80,565
Beneficial Corp. ....................... 6,000 919,125
FBR Asset Investment Corp. ............. 50,000 912,500
H & R Block, Inc. ...................... 7,000 294,875
Imperial Credit Commercial Mortgage
Investment Corp. ....................... 30,000 391,875
Food Wholesalers - .52%
SuperValu, Inc. ........................ 10,000 443,750
Gas Utilities - .70%
Enron Corp. ............................ 11,000 594,688
Atlas Balanced Fund (continued)
- --------------------------------------------------------------------------------
shares or value
face amount (note 1)
------------- -------------
Homebuilders\Real Estate - .69%
Anthracite Mortgage Capital, Inc. ...... 25,000 $ 346,875
Horizon Group Properties, Inc. ......... 1,000 6,594
Prime Retail, Inc. ..................... 20,000 238,750
Industrial Manufacturing - .51%
Sonoco Products Co. .................... 14,300 432,573
Insurance - 2.77%
Allstate Corp. ......................... 2,781 254,635
American General Corp. ................. 12,000 854,250
IPC Holdings, Ltd. ..................... 6,000 181,875
Reliance Group Holdings, Inc. .......... 30,000 525,000
St. Paul Companies, Inc. ............... 13,000 546,813
Machine Tools & Equipment - .79%
Cooper Industries, Inc. ................ 5,000 274,688
Snap-On, Inc. .......................... 11,000 398,750
Metals Mining - .20%
Reynolds Metals Co. .................... 3,000 167,813
Oil & Gas - 2.25%
Mobil Corp. ............................ 2,000 153,250
Occidental Petroleum Corp. ............. 4,000 108,000
Phillips Petroleum Co. ................. 3,000 144,563
Royal Dutch Petroleum Co., ADR ......... 4,000 219,250
Sempra Energy, Inc. .................... 7,519 208,650
Tenneco, Inc. .......................... 9,000 342,563
Ultramar Diamond Shamrock Corp. ........ 6,000 189,373
Unocal Corp. ........................... 6,000 214,500
USX-Marathon Group ..................... 10,000 343,125
Paper & Forest Products - 1.39%
Fort James Corp. ....................... 11,967 532,532
Union Camp Corp. ....................... 4,500 223,313
Westvaco Corp. ......................... 7,000 197,750
Weyerhaeuser Co. ....................... 5,000 230,938
Printing, Publishing & Allied Products - .68%
Dun & Bradstreet Corp. ................. 16,000 578,000
Retail Trade - 1.34%
Family Dollar Stores, Inc. ............. 22,000 407,000
J.C. Penney Company, Inc. .............. 6,000 433,875
Sears Roebuck & Co. .................... 5,000 305,313
Telecommunications - 1.38%
BCE, Inc. .............................. 6,000 256,125
GTE Corp. .............................. 8,000 445,000
SBC Communications, Inc. ............... 12,000 480,000
Telephone Utilities - .22%
Portugal Telecom SA, ADR ............... 3,500 185,281
------------
Total Common Stocks (cost: $20,774,408) 29,843,551
------------
Convertible Preferred Stocks - 12.98%
Banks - 2.38%
Bank of Portugal ....................... 4,000 416,000
National Australia Bank, Ltd. .......... 30,000 860,625
St. George Bank (a) .................... 8,000 382,000
Westpac Banking Corp. STRYPES .......... 12,400 374,325
Broadcast, Radio & TV - .52%
Merrill Lynch-Cox Communications
STRYPES ................................ 11,000 441,375
Consumer Goods & Services - 1.69%
Newell Co. ............................. 25,000 1,443,750
24 The accompanying notes are an integral part of these financial statements.
<PAGE>
- --------------------------------------------------------------------------------
Atlas Balanced Fund (continued)
- --------------------------------------------------------------------------------
shares or value
face amount (note 1)
------------- -------------
Electrical Utilities - .31%
Houston Industries, Inc. ACES ............ 3,500 $ 260,750
Electronics - .25%
Elsag Bailey Process
Automation N.V. (a) ...................... 5,000 210,625
Environmental Management - .29%
Browning-Ferris Industries, Inc. ACES .... 7,000 246,750
Financial Services - .76%
MCN Corp. PRIDES ......................... 8,000 189,500
MCN Financing III PRIDES ................. 10,000 458,750
Food & Related - .33%
Chiquita Brands .......................... 5,000 282,500
Gas Utilities - .23%
Enron Corp. ACES ......................... 10,000 200,000
Industrials - .19%
Owens Corning Capital LLC MIPS ........... 3,000 161,436
Insurance - 1.71%
American Heritage Life Investment Corp. .. 5,000 325,000
PLC CAP Trust II ........................ 11,500 713,000
Salomon, Inc.-FSA Holdings, Inc. DECS .... 9,000 425,250
Leisure & Entertainment - .67%
Premier Parks, Inc. PIES ................. 9,000 571,500
Printing, Publishing & Allied Products - .46%
Hollinger International .................. 25,000 393,750
Specialty Retailing - 1.25%
Merrill Lynch-Dollar General Corp.
STRYPES (b) .............................. 27,100 1,065,369
Telecommunications - 1.46%
IXC Communications, Inc. (a) ............. 3,221 691,115
U.S. West, Inc. .......................... 10,000 557,500
Transportation - .48%
Union Pacific Corp. ...................... 8,800 411,400
------------
Total Convertible Preferred Stocks (cost: $9,056,172) 11,082,270
------------
Convertible Bonds - 1.08%
Industrials - .30%
Alza Corp., 5% due 05/01/06 .............. $ 200,000 253,000
Insurance - .46%
Mutual Risk Management,
0% due 10/30/15 (a) ...................... $ 500,000 391,250
Metals Mining - .32%
Inco, Ltd., 5.75% due 07/01/04 ........... $ 300,000 275,250
------------
Total Convertible Bonds (cost: $702,047) 919,500
------------
Corporate Bonds - 3.79%
Automotive - .11%
General Motors Acceptance Corp.,
5.50% due 12/15/01 ....................... $ 100,000 97,993
Banks - 1.11%
First Chicago NBD Bancorp.,
7.25% due 08/15/04 ....................... $ 590,000 619,578
NationsBank Georgia,
8.50% due 03/01/99 ....................... $ 325,000 329,063
Atlas Balanced Fund (continued)
- --------------------------------------------------------------------------------
shares or value
face amount (note 1)
-------------- --------------
Broadcast, Radio & TV - .20%
Tele-Communications, Inc.,
7.25% due 08/01/05 ......................... $ 160,000 $ 168,671
Diversified Media - .10%
Time Warner, Inc., 7.95% due 02/01/00 ...... $ 80,000 82,070
Drugs and Health Care - .29%
R.P. Scherer Corp., 6.75% due 02/01/04 ..... $ 250,000 251,283
Financial Services - .30%
PaineWebber Group, Inc.,
7% due 03/01/00 ............................ $ 250,000 253,101
Food Processing - .31%
ConAgra, Inc., 7.40% due 09/15/04 .......... $ 250,000 263,708
Foreign Government - .18%
Treasury Corp. of Victoria, 9% due
09/04/02 ................................... $ 228,000 157,866
Gas Utilities - .39%
Enron Corp., 7.625% due 09/10/04 ........... $ 175,000 187,588
Enron Corp., 9.875% due 06/15/03 ........... $ 125,000 144,512
Hotel/Gaming - .14%
Circus Circus Enterprises, Inc.,
6.75% due 07/15/03 ......................... $ 125,000 120,798
Oil and Gas - .41%
Coastal Corp., 9.75% due 08/01/03 .......... $ 300,000 345,522
Paper & Forest Products - .25%
Fletcher Challenge Canada, Ltd.,
7.75% due 06/20/06 ......................... $ 200,000 214,305
-------------
Total Corporate Bonds (cost: $3,168,138) 3,236,058
-------------
United States Treasury Notes - 22.62%
6.125% due 08/31/98 ......................... $ 2,000,000 2,002,500
5.50% due 11/15/98 ......................... $ 1,990,000 1,990,620
5.875% due 08/31/99 ......................... $ 1,000,000 1,003,437
6.625% due 03/31/02 ......................... $ 4,000,000 4,142,500
Strip, 0% due 08/15/20 ...................... $ 36,000,000 10,182,924
-------------
Total United States Treasury Notes (cost: $17,482,139) 19,321,981
-------------
Short-Term Securities - 24.06%
Triparty Repurchase Agreement dated June
30, 1998 with Prudential Securities, Inc.,
effective yield of 5.32%, due July 1, 1998,
collateralized by FNMAs, 6.45%, April
23, 2001 with a value of $20,964,411 ....... $ 20,550,860 20,550,860
-------------
Total Short-Term Securities (cost: $20,550,860) 20,550,860
-------------
Total Securities (cost: $71,733,764) - 99.48% 84,954,220
Other Assets and Liabilities, Net - 0.52% 442,962
-------------
Net Assets - 100.00% $ 85,397,182
=============
25
<PAGE>
Statements of Investments in Securities and Net Assets
June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Atlas Growth and Income Fund
- --------------------------------------------------------------------------------
shares or value
face amount (note 1)
------------- ------------
Common Stocks - 81.41%
Advertising - .25%
Young and Rubicam, Inc. (b) ................. 18,300 $ 585,589
Aerospace/Defense - .61%
Precision Castparts Corp. ................... 27,000 1,441,125
Apparel & Textiles - 1.40%
Jones Apparel Group, Inc. (b) ............... 66,000 2,413,125
Wolverine World Wide, Inc. .................. 42,450 920,634
Automotive - 1.05%
Republic Industries, Inc. (b) ............... 100,000 2,500,000
Banks - 7.26%
Banc One Corp. .............................. 20,000 1,116,250
Chase Manhattan Corp. ....................... 20,000 1,510,000
Fifth Third Bancorp ......................... 50,000 3,150,000
First Tennessee National Corp. .............. 75,000 2,367,188
First Union Corp. ........................... 40,000 2,330,000
Fleet Financial Group, Inc. ................. 14,900 1,244,150
National City Corp. ......................... 15,000 1,065,000
National Commerce Bancorp ................... 25,000 1,046,875
US Bancorp .................................. 80,000 3,440,000
Chemicals & Allied Products - 1.04%
Goodrich (B. F.) Co. ........................ 50,000 2,481,250
Computer Hardware - 6.84%
BMC Software, Inc. (b) ...................... 50,000 2,596,875
CBT Group PLC (b) ........................... 35,000 1,872,500
Cisco Systems, Inc. (b) ..................... 16,500 1,519,031
Compuware Corp. (b) ......................... 50,000 2,556,250
Dell Computer Corp. (b) ..................... 30,000 2,784,375
EMC Corp. (b) ............................... 15,000 672,188
International Business Machines Corp. ....... 10,000 1,148,125
J. D. Edwards & Co. (b) ..................... 30,000 1,288,125
Microsoft Corp. (b) ......................... 6,000 650,250
PeopleSoft, Inc. (b) ........................ 25,000 1,175,000
Consumer Goods & Services - 1.88%
Maytag Corp. ................................ 35,000 1,728,125
Newell Co. .................................. 55,000 2,739,688
Cosmetics/Personal Care - .65%
Avon Products, Inc. ......................... 20,000 1,550,000
Diversified Financial - .83%
Health Care Properties Investment, Inc. ..... 54,600 1,969,013
Drugs & Health Care- 7.43%
American Home Products Corp. ................ 36,000 1,863,000
Bristol-Myers Squibb Co. .................... 32,000 3,678,000
Cardinal Health, Inc. ....................... 40,000 3,750,000
Healthsouth Corp. (b) ....................... 150,000 4,003,125
Merck & Co., Inc. ........................... 18,000 2,407,500
Orthodontic Centers of America, Inc. (b) 50,000 1,046,875
Pharmacia & Upjohn, Inc. .................... 20,000 922,500
Electrical Equipment - .43%
AMP, Inc. ................................... 30,000 1,031,250
Electrical Utilities - 1.51%
Edison International, Inc. .................. 50,000 1,478,125
Unicom Corp. ................................ 60,000 2,103,750
Energy Services & Producers - 1.41%
Halliburton Co. ............................. 75,000 3,342,188
Environmental Management - 1.24%
Allied Waste Industries, Inc. (b) ........... 50,000 1,200,000
USA Waste Services, Inc. .................... 35,524 1,753,998
Atlas Growth and Income Fund (continued)
- --------------------------------------------------------------------------------
shares or value
face amount (note 1)
------------- ------------
Financial Services - 8.59%
American Express Co. ........................ 28,000 $3,192,000
Associates First Capital Corp. .............. 45,000 3,459,375
Beneficial Corp. ............................ 5,000 765,938
Charles Schwab Corp. ........................ 30,000 975,000
Federal Home Loan Mortgage Corp. ............ 100,000 4,706,250
Heller Financial, Inc. (b) .................. 15,500 465,000
Household International, Inc. ............... 49,500 2,462,625
Morgan Stanley, Dean Witter,
Discover & Co. .............................. 20,000 1,827,500
SunAmerica, Inc. ............................ 45,000 2,584,688
Food & Beverage - .93%
Hormel Foods Corp. .......................... 15,000 518,438
Suiza Foods Corp. (b) ....................... 5,000 298,438
US Food Service (b) ......................... 40,000 1,402,500
Homebuilders/Real Estate - 1.23%
Correctional Properties Trust (b) ........... 25,000 506,250
INMC Mortgage Holdings, Inc. ................ 29,000 659,750
Kilroy Realty Corp. ......................... 70,600 1,765,000
Industrial Manufacturing - 3.41%
Sonoco Products Co. ......................... 60,000 1,815,000
Tyco International, Ltd. .................... 100,000 6,300,000
Industrial Services - .84%
ServiceMaster Co. (b) ....................... 52,200 1,986,863
Insurance - 3.52%
Allstate Corp. .............................. 15,000 1,373,438
American General Corp. ...................... 20,000 1,423,750
Hartford Financial Services Group, Inc. ..... 17,000 1,944,375
Travelers Group, Inc. ....................... 60,000 3,637,500
Leisure & Entertainment - 2.67%
Carnival Corp., Cl. A ....................... 80,000 3,170,000
Royal Caribbean Cruises, Ltd. ............... 40,000 3,180,000
Manufacturing - 1.82%
Ethan Allen Interiors, Inc. ................. 25,000 1,248,438
Owens-Illinois, Inc. ........................ 68,700 3,074,325
Medical Products - .96%
Guidant Corp. ............................... 32,000 2,282,000
Oil & Gas - 2.01%
Exxon Corp. ................................. 17,000 1,212,313
Stolt Comex Seaway SA (b) ................... 35,000 678,125
Tenneco, Inc. .............................. 20,000 761,250
USX-Marathon Group .......................... 62,000 2,127,375
Printing, Publishing & Allied Products -.96%
Dun & Bradstreet Corp. (b) .................. 25,000 903,125
R. R. Donnelley & Sons Co. .................. 30,000 1,372,500
Restaurants - 1.12%
Starbucks Corp. (b) ......................... 50,000 2,671,875
Retail Trade - 5.81%
Abercrombie & Fitch Co. (b) ................. 25,000 1,100,000
J. C. Penney Company, Inc. .................. 20,000 1,446,250
Kohl's Corp. (b) ............................ 60,000 3,112,500
Pier 1 Imports, Inc. ........................ 82,500 1,969,688
Stage Stores, Inc. (b) ...................... 55,000 2,488,750
Wal-Mart Stores, Inc. ....................... 61,000 3,705,750
Semi-Conductors - .79%
Uniphase Corp. (b) .......................... 30,000 1,883,436
26 The accompanying notes are an integral part of these financial statements.
<PAGE>
- --------------------------------------------------------------------------------
Atlas Growth and Income Fund (continued)
- --------------------------------------------------------------------------------
shares or value
face amount (note 1)
------------- --------------
Specialty Retailing - 6.16%
CVS Corp. ................................ 84,000 $ 3,270,750
General Nutrition Co. (b) ................ 65,000 2,023,125
Home Depot, Inc. (b) ..................... 45,000 3,737,813
Intimate Brands, Inc. .................... 50,000 1,378,125
Linens 'N Things, Inc. (b) ............... 80,000 2,445,000
Lowe's Cos., Inc. ........................ 44,000 1,784,750
Telecommunications - 6.76%
Airtouch Communications, Inc. (b) ........ 25,000 1,460,938
Bell Atlantic Corp. ...................... 64,000 2,920,000
Ciena Corp. (b) .......................... 24,000 1,671,000
GTE Corp. ................................ 16,500 917,813
Lucent Technologies, Inc. ................ 6,000 499,125
Nextel Communications, Inc. (b) .......... 55,000 1,368,125
Northern Telecom, Ltd. ................... 35,000 1,986,250
U.S. West Communications Group ........... 60,000 2,820,000
Worldcom, Inc. (b) ....................... 50,000 2,421,875
-------------
Total Common Stocks (cost: $146,521,155) 193,603,109
-------------
Convertible Preferred Stocks - 4.39%
Computer Software - 1.64%
Microsoft Corp. .......................... 41,000 3,895,000
Food & Beverages - .63%
Suiza Capital Trust ...................... 30,000 1,492,500
Insurance - .33%
Merrill Lynch-Sun America STRYPES ........ 11,000 797,500
Leisure & Entertainment - .75%
Premier Parks, Inc. ...................... 28,000 1,778,000
Manufacturing - .47%
Owens-Illinois, Inc. (b) ................. 21,400 1,115,475
Telecommunications - .57%
Winstar Communications, Inc. (a) ......... 25,000 1,353,125
-------------
Total Convertible Preferred Stocks (cost: $9,646,072) 10,431,600
-------------
Convertible Bonds - 3.92%
Computer Hardware - 1.32%
Affiliated Computer Services, Inc.,
4% due 03/15/05 ......................... $ 1,000,000 1,088,750
EMC Corp., 3.25% due 03/15/02 (a) ........ $ 1,000,000 2,058,750
Drugs & Health Care - .61%
Concentra Managed Care, Inc.,
4.50% due 03/15/03 ....................... $ 500,000 448,750
Healthsouth Corp., 3.25% due 04/01/03 .... $ 1,000,000 993,750
Electronics - .23%
Level One Communications, Inc.,
4% due 09/01/04 .......................... $ 500,000 559,375
Retail Trade - .58% .....................
Pier 1 Imports, Inc., 5.75% due 10/01/03 $ 700,000 1,374,625
Specialty Retailing - 1.18%
Home Depot, Inc., 3.25% due 10/01/01 ..... $ 1,500,000 2,793,750
-------------
Total Convertible Bonds (cost: $6,831,722) 9,317,750
-------------
Atlas Growth and Income Fund (continued)
- --------------------------------------------------------------------------------
shares or value
face amount (note 1)
-------------- ---------------
United States Treasury Notes - 5.15%
6.25% due 03/31/99 ......................... $ 1,500,000 $ 1,508,438
6% due 08/15/00 ............................ $ 500,000 504,688
5.75% due 11/15/00 ......................... $ 2,000,000 2,010,000
6% due 07/31/02 ............................ $ 500,000 508,438
5.875% due 09/30/02 ........................ $ 1,000,000 1,012,500
5.625% due 12/31/02 ........................ $ 2,000,000 2,008,124
6.50% due 05/15/05 ......................... $ 500,000 527,813
5.875% due 11/15/05 ........................ $ 2,000,000 2,038,750
6.125% due 08/15/07 ........................ $ 1,000,000 1,040,937
6.375% due 08/15/27 ........................ $ 1,000,000 1,098,437
--------------
Total United States Treasury Notes (cost: $11,954,825) 12,258,125
--------------
Short-Term Securities - 4.90%
Triparty Repurchase Agreement dated June
30, 1998 with Prudential Securities, Inc.,
effective yield of 5.32%, due July 1, 1998,
collateralized by FHLMC, 6.773%, August
1, 2025 with a value of $11,877,118 ....... $ 11,643,887 11,643,887
--------------
Total Short-Term Securities (cost: $11,643,887) 11,643,887
--------------
Total Securities (cost: $186,597,661) - 99.77% 237,254,471
Other Assets and Liabilities, Net - 0.23% 541,110
--------------
Net Assets - 100.00% $ 237,795,581
==============
Atlas Strategic Growth Fund
- --------------------------------------------------------------------------------
shares or value
face amount (note 1)
------------- ------------
Common Stocks - 78.32%
Air Freight - 1.08%
Federal Express Corp. (b) ............... 15,800 $ 991,450
Air Travel - 5.01% .......................
AMR Corp. ............................... 19,400 1,615,050
Delta Air Lines, Inc. ................... 10,900 1,408,825
Southwest Airlines, Inc. ................ 53,300 1,579,011
Apparel & Textiles - 5.08%
Dillard's, Inc., Cl. A (b) .............. 20,500 849,469
Federated Department Stores, Inc. (b) 27,500 1,479,844
TJX Companies, Inc. ..................... 69,200 1,669,450
VF Corp. ................................ 13,000 669,500
Automotive - 4.16%
Chrysler Corp. .......................... 25,600 1,443,200
Navistar International Corp. (b) ........ 35,900 1,036,611
Paccar, Inc. ........................... 25,800 1,343,213
Building Materials - 3.17%
Masco Corp. ............................. 22,600 1,367,300
Owens Corning ........................... 37,900 1,546,792
27
<PAGE>
Statements of Investments in Securities and Net Assets
June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Atlas Strategic Growth Fund (continued)
- --------------------------------------------------------------------------------
shares or value
face amount (note 1)
------------- ------------
Computer Hardware - 7.80%
Apple Computer, Inc. (b) ................ 39,900 $1,144,631
Compaq Computer Corp. (b) ............... 26,743 758,847
Dell Computer Corp. (b) ................. 20,400 1,893,375
Sun Microsystems, Inc. (b) .............. 32,000 1,390,000
Unisys Corp. (b) ........................ 70,200 1,983,150
Construction Services - 1.65%
Fluor Corp. ............................. 29,800 1,519,800
Consumer Goods & Services - 2.23%
Cendant Corp. (b) ....................... 33,600 701,400
Maytag Corp. ............................ 27,400 1,352,875
Drugs & Health Care - 1.17%
United Healthcare Corp. ................. 17,000 1,079,500
Electronics - 1.89%
KLA-Tencor Corp. (b) .................... 27,400 758,638
Tektronix, Inc. ......................... 27,600 976,350
Financial Services - 6.96%
Countrywide Credit Industries, Inc. ..... 27,700 1,405,775
Federal Home Loan Mortgage Corp. ........ 30,500 1,435,406
Federal National Mortgage Association 18,400 1,117,800
Lehman Brothers Holdings, Inc. .......... 16,800 1,303,050
State Street Corp. ...................... 16,300 1,132,850
Food & Beverages - .92%
Fleming Companies, Inc. ................. 48,000 843,000
Gold - 1.45%
Placer Dome, Inc. ....................... 113,800 1,337,150
Health Care/Supplies & Services - 1.57%
Shared Medical Systems Corp. ............ 19,600 1,439,375
Homebuilders/Real Estate - 6.70%
Centex Corp. ............................ 40,700 1,536,425
Fleetwood Enterprises, Inc. ............. 35,600 1,424,000
Kaufman & Broad Home Corp. .............. 48,900 1,552,575
Pulte Corp. ............................. 55,200 1,649,100
Insurance - 6.21%
Allstate Corp. .......................... 15,100 1,382,594
Conseco, Inc. ........................... 30,500 1,425,875
MBIA, Inc. .............................. 11,400 853,575
MGIC Investment Corp. ................... 15,400 878,763
St. Paul Companies, Inc. ................ 27,800 1,169,338
Leisure & Entertainment - 1.37%
Harrah's Entertainment, Inc. (b) ........ 54,200 1,260,150
Manufacturing - 4.06%
Cincinnatti Milacron, Inc. .............. 47,500 1,154,844
Ingersoll-Rand Co. ...................... 26,300 1,158,844
Owens-Illinois, Inc. (b) ................ 31,700 1,418,575
Oil & Gas - 2.90%
Armco, Inc. ............................. 261,600 1,667,700
Sun Company, Inc. ....................... 25,600 993,600
Printing, Publishing & Allied Products - 1.19%
Dun & Bradstreet Corp. .................. 30,300 1,094,588
Retail Trade - 4.16%
Costco Companies, Inc. (b) .............. 21,500 1,355,844
Dayton Hudson Corp. ..................... 33,200 1,610,200
K Mart Corp. ............................ 44,700 860,475
Specialty Retailing - 1.63%
Autozone, Inc. (b) ...................... 46,800 1,494,675
Steel - 4.44%
Bethlehem Steel Corp. ................... 116,100 1,443,994
Inland Steel Industries, Inc. ........... 52,200 1,471,388
USX-US Steel Group, Inc. ................ 35,300 1,164,900
Atlas Strategic Growth Fund (continued)
- --------------------------------------------------------------------------------
shares or value
face amount (note 1)
-------------- --------------
Telecommunications - 1.52%
Scientific-Atlanta, Inc. ................. 55,200 $ 1,400,700
-------------
Total Common Stocks (cost: $58,919,687) 71,995,409
-------------
Short-Term Securities - 21.62%
Triparty Repurchase Agreement dated June
30, 1998 with Prudential Securities, Inc.,
effective yield of 5.32%,
due July 1, 1998, collateralized
by FHLMCs, 6.218%, January 1, 2022
with a value of $6,972,952,
by FHLMCs, 6.773%, August 1, 2025
with a value of $987,777,
by FNMAs, 6.236%, December 1, 2017
with a value of $6,223,617, and
by FNMAs, 5.942%, August 1, 2027
with a value of $6,091,439 ............... $ 19,877,782 19,877,782
-------------
Total Short-Term Securities (cost: $19,877,782) 19,877,782
-------------
Total Securities (cost: $78,797,469) - 99.94% 91,873,191
Other Assets and Liabilities, Net - 0.06% 59,233
-------------
Net Assets - 100.00% $ 91,932,424
=============
Atlas Global Growth Fund
- --------------------------------------------------------------------------------
shares, units or value
face amount (note 1)
------------------ -----------
Common Stocks - 96.58%
Advertising - .77%
Publicis SA .............................. 2,000 $ 346,059
Aerospace/Defense - .76%
Rolls-Royce PLC .......................... 83,300 343,501
Air Travel - .79%
Ryanair Holdings PLC,
Sponsored ADR (b) ........................ 10,000 356,250
Automotive - 2.98%
Porsche AG, Preference ................... 300 864,290
Volkswagen AG ............................ 500 482,285
Banks - 15.92%
Absa Group, Ltd. ......................... 40,000 248,531
Banco Bradesco SA, Preference ............ 32,262,845 267,782
Banco Espirito Santo e Comercial de
Lisboa (b) ............................... 10,950 328,713
Banco Frances del Rio de la Plata SA,
Sponsored ADR ............................ 7,600 174,325
Banco Pinto & Sotto Mayor SA ............. 8,900 220,838
Banco Rio de la Plata, Sponsored ADR ..... 25,000 264,063
Bank Austria AG .......................... 3,000 244,021
Bank Handlowy W. Warszawie (b) ........... 15,000 286,063
Banque Libanaise Pour Le Comm SAL,
GDR, Cl. B ............................... 14,000 196,700
Barclays PLC ............................. 3,068 88,713
Bayerische Vereinsbank AG ................ 8,000 678,135
28 The accompanying notes are an integral part of these financial statements.
<PAGE>
- --------------------------------------------------------------------------------
Atlas Global Growth Fund (continued)
- --------------------------------------------------------------------------------
shares, units or value
face amount (note 1)
------------------ ------------
Credito Italiano SPA ...................... 114,500 $ 594,975
Deutsche Bank AG 6,000 507,272
Industrial Credit & Investment Corp. ......
of India, Ltd. GDR (a) .................... 9,300 84,933
Industrial Finance Corp. .................. 45,300 9,350
Istituto Bancario San Paolo di Torino ..... 20,000 291,811
National Westminster Bank PLC ............. 24,700 441,645
Northern Trust Corp. ...................... 2,800 213,500
PT Pan Indonesia Bank ..................... 552,000 13,188
Skandinaviska Enskilda Banken, Ser. A ..... 30,000 513,106
Uniao de Bancos Brasileiros SA,
Sponsored GDR ............................. 13,500 398,250
Union Bank of Switzerland ................. 3,000 1,116,095
Beer, Wine, & Distilled Alcohol - .64%
Companhia Cervejaria Brahma,
Preference ................................ 140,000 86,604
Remy Cointreau ............................ 6,126 117,944
South African Breweries, Ltd. ............. 4,050 83,887
Broadcast, Radio & TV - 7.84%
Canal Plus ................................ 7,851 1,466,143
Carlton Communications PLC ................ 100,000 893,183
Grupo Televisa SA, Sponsored GDR (b) ...... 12,500 470,313
Societe Television Francaise .............. 300 46,604
Television Broadcast, Ltd. (b) ............ 27,000 71,447
Telewest Communication PLC (b) ............ 250,000 590,293
Computer Hardware - 1.79%
Cisco Systems, Inc. (b) ................... 2,250 207,141
International Business Machines Corp. ..... 2,200 252,588
Sun Microsystems, Inc. (b) ................ 8,000 347,500
Computer Software - 4.53%
Cap Gemini Sogeti SA ...................... 5,410 849,364
Computer Associates, Inc. ................. 4,800 266,700
First Data Corp. .......................... 400 13,325
Microsoft Corp. (b) ....................... 2,000 216,750
Misys PLC ................................. 4,000 227,386
Nintendo Corp., Ltd. ...................... 5,000 469,587
Conglomerate - 2.16%
Kinnevik AB, Cl. B ........................ 30,000 975,466
Consumer Goods & Services - 2.23%
Callaway Golf Co. ......................... 17,000 334,688
Granada Group PLC ......................... 36,500 671,523
PT Citra Marga Nusaphala Persada .......... 60,000 1,229
Diversified Financial - 1.65%
American Express Co. ...................... 2,000 228,000
Compagnie Financiere de Paribas ........... 3,000 320,773
First NIS Regional Russia ................. 3,800 35,626
Grupo Financiero Banamex Accival SA
de CV, Cl. B (b) .......................... 83,900 158,907
Drugs & Health Care - 7.94%
Amgen, Inc. (b) ........................... 6,000 392,250
BioChem Pharma, Inc. (b) .................. 7,600 202,481
Fresenius AG, Preference .................. 2,000 378,958
Genset, Sponsored ADR (b) ................. 22,500 660,938
Genzyme Corp.-General Division (b) ........ 5,000 127,813
Genzyme Corp.-Tissue Repair (b) ........... 174 1,109
Gilead Sciences, Inc. (b) ................. 3,100 99,394
Glaxo Wellcome PLC, Sponsored ADR ......... 10,000 598,125
Novartis AG-Reg ........................... 200 332,982
Pfizer, Inc. .............................. 5,000 543,438
Pliva D. D., GDR (a)(b) ................... 15,000 243,750
Atlas Global Growth Fund (continued)
- --------------------------------------------------------------------------------
shares, units or value
face amount (note 1)
------------------ ----------
Electric Utilities - 1.15%
Beijing Datang Power
Generation Co., Ltd. .......................... 600,000 $168,452
Electricidade de Portugal SA .................. 15,000 348,577
Electronics - 5.14%
Advanced Micro Devices, Inc. (b) .............. 25,000 426,563
General Instrument Corp. (b) .................. 20,000 543,750
National Semiconductor Corp. (b) .............. 35,000 461,563
Philips Electronics NV ........................ 5,000 420,178
SGS-Thomson Microelectronics N.V. (b) ......... 1,700 118,788
Sony Corp. .................................... 4,000 346,126
Energy Services & Producers - .91%
Global Marine, Inc. (b) ....................... 7,000 130,813
Transocean Offshore, Inc. ..................... 3,400 151,300
Western Atlas, Inc. (b) ....................... 1,500 127,313
Environmental Management - 1.67%
Rentokil Initial PLC .......................... 105,000 755,532
Financial Services - 1.52%
Associates First Capital Corp. ................ 5,000 384,375
Federal National Mortgage Association ......... 5,000 303,750
Food & Beverages - 3.45%
Cadbury Schweppes Plc ......................... 60,000 929,077
Cresud SA, Sponsored ADR ...................... 5,000 81,250
Dairy Farm International Holdings, Ltd. ....... 364,458 389,970
Hellenic Bottling Co., SA ..................... 5,000 154,519
Health Care/Supplies & Services - 1.63%
Incyte Pharmaceuticals, Inc. (b) .............. 1,600 54,600
Millenium Pharmaceuticals, Inc. (b) ........... 5,000 70,625
Quintiles Transnational Corp. (b) ............. 5,000 245,938
United States Surgical Corp. .................. 8,000 365,000
Homebuilders/Real Estate - .89%
Brazil Realty SA, GDR (a) ..................... 3,000 66,141
IRSA Inversiones y Representaciones SA ........ 50,000 147,021
Solidere, GDR ................................. 15,000 186,000
Hotel/Gaming - 1.98%
International Game Technology ................. 14,100 341,925
Ladbroke Group PLC (b) ........................ 100,000 549,266
Industrial Services - 2.48%
Adecco SA ..................................... 400 180,475
Brisa-Auto Estradas de Portugal SA (b) ........ 4,800 205,217
IHC Caland NV ................................. 700 39,389
McDermott International, Inc. ................. 10,000 344,375
WPP Group PLC ................................. 52,900 346,853
Industrial Technology - .10%
Unova, Inc. (b) ............................... 2,000 43,000
Insurance - 1.95%
American International Group, Inc. ............ 1,100 160,600
Chubb Corp. ................................... 5,000 401,875
Mediolanum SpA (b) ............................ 10,000 319,094
Leisure & Entertainment - .48%
Corporacion Interamericana de
Entretenimiento SA, Cl. B (b) ................. 62,436 173,733
Corporacion Interamericana de
Entretenimiento SA, Cl. L (b) ................. 8,324 19,456
Resorts World Berhad .......................... 21,000 23,213
Manufacturing - 1.83%
Bic Corp. ..................................... 4,500 319,782
Bombardier, Inc., Cl. B ....................... 200 5,440
Powerscreen International PLC ................. 40,970 62,927
Raisio Group PLC .............................. 24,000 435,763
29
<PAGE>
Statements of Investments in Securities and Net Assets
June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Atlas Global Growth Fund (continued)
- --------------------------------------------------------------------------------
shares, units or value
face amount (note 1)
---------------- -----------
Metals Mining - .89%
Barrick Gold Corp. ............................ 10,000 $ 191,875
De Beers Centenary AG ......................... 6,100 106,750
Minerals Technologies, Inc. ................... 600 30,525
Newmont Mining Corp. .......................... 3,000 70,875
Oil & Gas - .14%
British Petroleum Co. PLC, ADR ................ 4,205 61,497
Printing, Publishing & Allied Products - .33%
Reed International PLC ........................ 1,400 12,668
Singapore Press Holdings, Ltd. ................ 20,000 134,364
Retail Trade - 1.05%
Credit Saison Co., Ltd. ....................... 10,000 199,131
Sonae Investimentos-SGPS SA ................... 5,000 273,000
Specialty Retailing - 3.69%
Borders Group, Inc. (b) ....................... 10,000 370,000
Circuit City Stores, Inc. ..................... 4,000 187,500
Giordano International, Ltd. .................. 100,000 20,266
Grupo Elektra SA .............................. 63,000 61,973
Luxottica Group, Sponsored ADR ................ 20,000 310,000
VBH-Vereinigter Baubeschlag
Handel AG ..................................... 2,000 42,660
Wella AG, Preference .......................... 600 671,487
Supermarkets - 2.31%
Carrefour Supermarche SA ...................... 600 379,276
Great Atlantic & Pacific Tea Co., Inc. ........ 20,000 661,250
Telecommunications - 9.41%
Alcatel Alsthom SA ............................ 4,500 915,469
Cable & Wireless Communications PLC ........... 20,000 202,677
Energis PLC ................................... 35,800 545,430
Hellenic Telecommunication
Organization SA ............................... 16,665 427,350
Pairgain Technologies, Inc. (b) ............... 5,200 90,675
QUALCOMM, Inc. (b) ............................ 8,000 449,500
Scientific - Atlanta, Inc. .................... 17,400 441,525
SK Telecom Co., Ltd. .......................... 618 192,647
Telerj Cellular SA, Preference B .............. 1,051,000 87,239
Videsh Sanchar Nigam .......................... 10,000 107,000
Worldcom, Inc. ................................ 16,200 784,688
Telephone Utilities - 2.05%
Portugal Telecom SA, ADR ...................... 7,000 370,873
Telecom Italia SpA ............................ 50,000 305,006
Telecomunicacoes de Sao Paulo SA,
Preference .................................... 1,051,000 250,769
Toys - 1.31%
Hasbro, Inc. .................................. 15,000 589,688
Transportation - .22%
Guangshen Railway Co., Ltd.,
Sponsored ADR ................................. 14,800 100,825
-----------
Total Common Stocks (cost: $36,698,390) 43,554,665
-----------
Rights, Warrants and Certificates - 0.00%
Adecco Sa, Exp. 07/15/98 ...................... 2,000 0
Bank Austria AG, Rights, Exp. 07/15/98 ........ 3,000 0
Kinnevik AB, Cl. B, Rights,
Exp. 08/18/98 ................................ 30,000 0
PT Panin Bank Rights, Exp. 08/25/98 ........... 429,333 0
PT Panin Bank Warrants, Exp. 06/26/00 ......... 78,936 248
Telecomunicacoes de Sao Paulo SA
Rights, Exp. 07/08/98 ........................ 49,395 0
-----------
Total Rights, Warrants and Certificates (Cost: $0) 248
-----------
Atlas Global Growth Fund (continued)
- --------------------------------------------------------------------------------
shares, units or value
face amount (note 1)
------------------ ---------------
Short-Term Securities - 4.59%
Triparty Repurchase Agreement dated June
30, 1998 with Prudential Securities, Inc.,
effective yield of 5.32%, due July 1, 1998,
collateralized by FHLMCs, 6.773%,
August 1, 2025 with a value of
$2,113,898 ................................. $ 2,071,935 $ 2,071,935
------------
Total Short-Term Securities (cost: $2,071,935) 2,071,935
------------
Total Securities (cost: $38,770,325) - 101.17% 45,626,848
Other Assets and Liabilities, Net - (1.17)% (528,860)
------------
Net Assets - 100.00% $ 45,097,988
============
Atlas Emerging Growth Fund
- --------------------------------------------------------------------------------
shares or value
face amount (note 1)
----------- --------
Common Stocks - 84.75%
Computer Hardware - 1.35%
Network Appliance, Inc. (b) .......... 7,000 $272,561
Computer Software - 20.02%
Acxiom Corp. (b) ..................... 12,000 299,250
Aspen Technologies, Inc. (b) ......... 10,000 505,000
Cambridge Technology Partners (b) .... 5,000 273,125
Documentum, Inc. (b) ................. 4,000 192,000
Engineering Animation, Inc. (b) ...... 13,000 793,000
JDA Software Group, Inc. (b) ......... 6,000 262,500
Medical Manager Corp. (b) ............ 7,000 193,375
Network Solutions, Inc. (b) .......... 5,000 225,000
New Era of Networks, Inc. (b) ........ 10,000 305,000
Saville System Ireland PLC ADR (b) ... 12,000 601,500
Visio Corp. (b) ...................... 8,000 382,000
Consumer Goods & Services - 7.40%
Cornell Corrections, Inc. (b) ........ 10,000 210,000
CORT Business Services Corp. (b) ..... 6,000 189,000
Group Maintenance America Corp. (b) .. 12,000 216,000
Renters Choice, Inc. (b) ............. 10,000 283,750
Service Experts, Inc. (b) ............ 10,000 345,000
US Foodservice, Inc. (b) ............. 7,000 245,438
Diversified Financial - 1.09%
NCO Group, Inc. (b) .................. 10,000 220,000
Drugs & Health Care - .88%
Renal Care Group, Inc. (b) ........... 4,000 176,250
Education - 2.71%
Education Management Corp. (b) ....... 10,000 328,750
Strayer Education, Inc. .............. 6,000 217,500
Electronics - 2.94%
Pittway Corp., Cl. A ................. 8,000 591,000
Energy - 2.93%
Cal Dive International, Inc. (b) ..... 12,000 330,750
Core Laboratories NV (b) ............. 12,000 259,500
Environmental Management - 4.89%
American Disposal Services, Inc. (b) . 8,000 375,000
Casella Waste Systems, Inc., Cl. A (b) 10,000 270,000
Eastern Environmental Co. (b) ........ 10,000 340,000
30 The accompanying notes are an integral part of these financial statements.
<PAGE>
- --------------------------------------------------------------------------------
Atlas Emerging Growth Fund (continued)
- --------------------------------------------------------------------------------
shares or value
face amount (note 1)
------------- ---------------
Financial Services - 4.31%
Investors Financial Services Corp. ......... 8,000 $ 424,000
Resource America, Inc., Cl. A .............. 15,000 444,375
Health Care/Supplies & Services - 6.63%
Concentra Managed Care, Inc. (b) ........... 5,000 130,000
Covance, Inc. (b) .......................... 14,000 315,000
Serologicals Corp. (b) ..................... 13,000 419,250
Ventana Medical Systems, Inc. (b) .......... 8,000 224,000
VWR Scientific Products Corp. (b) .......... 10,000 246,250
Home Builders/Real Estate - 1.75%
Fairfield Communities, Inc. (b) ............ 14,000 268,625
First Alliance Corp. (b) ................... 12,000 84,000
Industrial Manufacturing - 1.03%
Applied Power, Inc., Cl. A ................. 6,000 206,250
Industrial Services - 3.21%
Metzler Group, Inc. (b) .................... 7,500 274,688
US Rental, Inc. (b) ........................ 6,000 236,625
West Teleservices Corp. (b) ................ 11,200 135,800
Leisure & Entertainment - 1.47%
Cinar Films, Inc. (b) ...................... 16,000 296,000
Oil & Gas - 1.52%
Cross Timbers Oil Co. ...................... 16,000 305,000
Printing, Publishing & Allied Products - .68%
Applied Graphics Technologies, Inc. (b) .... 3,000 137,250
Restaurants - 1.23%
Star Buffet, Inc. (b) ...................... 30,000 247,500
Retail Trade - 2.13%
Pier 1 Imports, Inc. ....................... 18,000 429,750
Specialty Retailing - 6.06%
Central Garden & Pet Co. (b) ............... 7,000 217,875
Linens 'N Things, Inc. (b) ................. 16,000 489,000
Zebra Technologies Corp., Cl. A ............ 12,000 513,000
Telecommunications - 10.52%
Electric Lightwave, Inc., Cl. A (b) ........ 14,000 154,875
General Cable Corp. ........................ 7,500 216,563
Hyperion Telecom, Inc., Cl. A (b) .......... 10,000 156,875
ICG Communications, Inc. (b) ............... 6,000 219,375
Intermedia Communications, Inc. (b) ........ 6,000 251,625
Pacific Gateway Exchange, Inc. (b) ......... 4,000 160,250
RSL Communications, Ltd. (b) ............... 10,000 300,000
Star Telecommunications, Inc. (b) .......... 10,000 223,750
Telegroup, Inc. (b) ........................ 20,000 185,000
US Lec Corp., Cl. A (b) .................... 12,000 250,500
-----------
Total Common Stocks (cost: $14,971,306) ..... 17,065,300
-----------
Short-Term Securities - 16.88%
Triparty Repurchase Agreement dated June
30, 1998 with Prudential Securities, Inc.,
effective yield of 5.32%, due July 1, 1998,
collateralized by FHLMC, 6.70%, January
5, 2007 with a value of $3,473,332 ......... $ 3,399,839 3,399,839
------------
Total Short-Term Securities (cost: $3,399,839) 3,399,839
------------
Total Securities (cost: $18,371,145) - 101.63% 20,465,139
Other Assets and Liabilities, Net - (1.63)% (329,160)
------------
Net Assets - 100.00% $ 20,135,979
============
* Variable rate demand notes are tax-exempt obligations which contain a
floating or variable interest rate adjustment formula (computed daily
or weekly) and an unconditional right of demand to receive payment of
the unpaid principal balance plus accrued interest upon short notice
prior to specified dates. The interest rate may change on specified
dates in relationship with changes in a designated rate (such as the
prime interest or U.S. Treasury Bill rates).
(a) Restricted securities which are exempt from registration under Rule
144A of the Securities Act of 1933. These securities may be resold in
transactions exempt from registration, normally to qualified
institutional buyers. At the end of the period the value of these
securities amounted to $1,674,990 or 1.96% of net assets in the
Balanced Fund, $3,411,875 or 1.43% of net assets in the Growth and
Income Fund, $16,032,958 or 23.03% of net assets in the Strategic
Income Fund, and $394,824 or 0.88% of net assets in the Global Growth
Fund.
(b) Non-income producing security.
(c) Represents the current interest rate for a variable rate security.
(d) Denotes a step bond: a zero coupon bond that converts to a fixed
rate of interest at a designated future date.
(e) Represents the current interest rate for an increasing rate security.
(f) For zero coupon bonds, the interest rate shown is the effective
yield on the date of purchase.
(g) Identifies issues considered to be illiquid - See Note 12 to
Financial Statements.
(h) Interest-Only Strips represent the right to receive the monthly
interest payments on an underlying pool of mortgage loans. These
securities typically decline in price as interest rates decline. Most
other fixed-income securities increase in price when interest rates
decline. The principal amount of the underlying pool represents the
notional amount on which current interest is calculated. The price of
these securities is typically more sensitive to changes in prepayment
rates than traditional mortgage- backed securities (for example, GNMA
pass-throughs).
(i) Interest or dividend is paid in kind.
(j) When-issued security to be delivered and settled after June 30, 1998.
(k) Units may be comprised of several components, such as debt and equity
and/or warrants to purchase equity at some point in the future. For
units which represent debt securities, face amount disclosed
represents total underlying principal.
(l) Indexed instrument for which the principal amount and/or interest due
at maturity is affected by the relative value of a foreign currency.
(m) Face amount is reported in U.S. Dollars, except for those denoted in
the following currencies:
AUD - Australian Dollar INR - Indian Rupee
ARP - Argentine Peso ITL - Italian Lira
CAD - Canadian Dollar JPY - Japanese Yen
CHF - Swiss Franc KRW - South Korean Won
CNR - China Renminbi MYR- Malaysian Ringgit
CZK - Czech Koruna MXP - Mexican Peso
DEM - German Deutsche Mark NOK - Norwegian Krone
DKK - Danish Krone NZD - New Zealand Dollar
ECU- European Currency Unit PHP- Philippine Peso
ESP - Spanish Peseta PLZ - Polish Zloty
FIM - Finnish Markka PTE- Portuguese Escudo
FRF - French Franc RUR - Russian Ruble
GBP - British Pound Sterling SEK - Swedish Krona
GRD - Greek Drachma SGD- Singapore Dollar
IDR - Indonesian Rupiah SKK - Slovakian Koruna
IEP - Irish Punt ZAR - South African Rand
31
<PAGE>
Statements of Investments in Securities and Net Assets
June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Contracts/Face Expiration Exercise Premium Market Value-
Subject to Call/Put Date Price Received See Note 1
------------------- ---------- -------- -------- -------------
(n) A sufficient amount of securities has been designated to cover outstanding written call and put options, as follows:
<S> <C> <C> <C> <C> <C>
Strategic Income Fund:
- ----------------------
German Mark/Swiss Franc Put Option 250,000 10/22/98 0.8028 DEM $ 850 $ 141
U.S. Treasury Bonds, 6.125% due 11/27 Put Option 600 11/20/98 $ 98 6,750 1,608
------ ------
$ 7,600 $ 1,749
------ ------
<FN>
(o) Securities with an aggregate market value of $247,806 are held in
collateralized accounts to cover initial margin requirements on open
futures purchase contracts. See Note 10 of Notes to Financial Statements.
(p) A sufficient amount of securities has been designated to cover outstanding
forward currency exchange contracts. See Note 9 of Notes to Financial
Statements.
</FN>
</TABLE>
ACES=Automatic Common Exchange Securities
ADR=American Depositary Receipt
AMBAC=AMBAC Indemnity Corporation
AMT=Alternative Minimum Tax
BIG=Bond Investors Guarantee
COP=Certificate of Participation
DECS=Debt Exchangeable for Common Stock
ELKS=Equity-Linked Security Valuation
Debt Exchangeable for Stock
FGIC=Financial Guarantee Insurance Corporation
FLIRBs=Front Loaded Interest Reduction Bonds
FSA=Financial Security Assurance Inc.
GDR=Global Depositary Receipt
LYONS=Liquid Yield Option Notes
MBIA=Municipal Bond Investors Assurance
MIPS=Monthly Income Preferred Shares
PIES=Premium Income Equity Securities
PRIDES=Provisionally Redeemable Income
STRYPES=Structured Yield Product Exchangeable for Stock
32 The accompanying notes are an integral part of these financial statements.
<PAGE>
- --------------------------------------------------------------------------------
(This page has been left blank intentionally.)
33
<PAGE>
<TABLE>
Statements of Assets and Liabilities June 30, 1998 (unaudited)
- ----------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Money Funds Bond Funds
----------------------------------------------------------------------------
California National California National
U.S. Treasury Municipal Municipal Municipal Municipal
Money Fund Money Fund Money Fund Bond Fund Bond Fund
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Assets:
Investment in securities, at identified cost ...... $ 57,139,955 $ 43,357,226 $ 5,402,080 $ 194,302,280 $ 58,202,238
============= ============= ============= ============= =============
Investment in securities, at value ................ $ 57,139,955 $ 43,357,226 $ 5,402,080 $ 207,920,879 $ 62,220,760
Cash .............................................. 26,503 5,110 0 0 0
Receivables for:
Sales of investments ............................. 0 0 0 0 0
Sales of Fund's shares ........................... 156,916 500 300 93,690 134,000
Accrued interest and dividends ................... 0 346,352 37,837 3,505,949 895,791
Other ............................................ 0 0 0 0 0
Unrealized appreciation on forward foreign currency
exchange contracts (Note 9) ....................... 0 0 0 0 0
Variation margin on futures contracts (Note 10) ... 0 0 0 0 0
Unamortized organization costs (Note 2) ........... 718 0 0 718 718
------------- ------------- ------------- ------------- -------------
Total assets ...................................... 57,324,092 43,709,188 5,440,217 211,521,236 63,251,269
------------- ------------- ------------- ------------- -------------
Liabilities:
Payables for:
Purchases of investments ......................... 136,361 2,005,760 0 0 0
Redemptions of Fund's shares ..................... 64,043 46,000 0 42,231 19,726
Dividends ........................................ 9,934 4,124 1,150 240,130 53,682
Repurchases of investments under dollar roll
agreements ....................................... 0 0 0 0 0
Accrued expenses ................................. 25,950 23,987 3,012 247,272 74,511
Other liabilities ................................ 0 0 27,450 7,637 46,175
Options written, at value (premiums
received $7,600) (Note 11) ........................ 0 0 0 0 0
------------- ------------- ------------- ------------- -------------
Total liabilities .................................. 236,288 2,079,871 31,612 537,270 194,094
------------- ------------- ------------- ------------- -------------
Net Assets ......................................... $ 57,087,804 $ 41,629,317 $ 5,408,605 $ 210,983,966 $ 63,057,175
============= ============= ============= ============= =============
Net Assets Consist Of:
Net unrealized appreciation (Note 3) .............. $ 0 $ 0 $ 0 $ 13,618,599 $ 4,018,522
Accumulated net realized gain (loss) .............. (22,716) (85) (377) 1,762,804 560,606
Undistributed net investment income (loss) ........ 0 0 0 0 0
Paid in capital ................................... 57,110,520 41,629,402 5,408,982 195,602,563 58,478,047
------------- ------------- ------------- ------------- -------------
Net Assets ......................................... $ 57,087,804 $ 41,629,317 $ 5,408,605 $ 210,983,966 $ 63,057,175
============= ============= ============= ============= =============
Net Asset Value Per Share:
Class A
Net Assets ....................................... $ 56,884,870 $ 41,629,317 $ 5,408,605 $ 202,963,747 $ 59,895,752
Shares outstanding ............................... 56,907,534 41,629,402 5,408,982 17,716,278 5,182,785
Net asset value per share and maximum
offering price ................................... $ 1.00 $ 1.00 $ 1.00 $ 11.46 $ 11.56
Class B
Net Assets ....................................... $ 202,934 NA NA $ 8,020,219 $ 3,161,423
Shares outstanding ............................... 202,986 NA NA 699,674 273,409
Net asset value per share and
maximum offering price ........................... $ 1.00 NA NA $ 11.46 $ 11.56
Capital Shares Authorized: ......................... 125,000,000 350,000,000 130,000,000 50,000,000 20,000,000
============= ============= ============= ============= =============
<FN>
34 The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
- -------------------------------------------------------------------------------------------------------------------
Stock Funds
- -------------------------------------------------------------------------------------------------------------------
<CAPTION>
U.S. Government Strategic Emerging
and Mortgage Income Balanced Growth and Strategic Global Growth
Securities Fund Fund Fund Income Fund Growth Fund Growth Fund Fund
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$ 232,365,264 $73,285,243 $71,733,764 $186,597,661 $78,797,469 $38,770,325 $18,371,145
============= =========== =========== ============ =========== =========== ===========
$ 236,655,280 $73,417,990 $84,954,220 $237,254,471 $91,873,191 $45,626,848 $20,465,139
273 232,007 0 0 0 0 0
0 1,191,517 133,021 142,309 0 700,746 0
59,437 136,720 243,985 330,572 185,155 168,886 7,989
1,184,169 1,285,208 367,444 438,842 57,526 81,089 2,294
42,159 643 2,859 3,055 0 43,647 8,125
0 49,514 0 0 0 59,664 0
0 7,732 0 0 0 0 0
718 0 718 718 718 0 0
------------- ----------- ------------ ------------- ------------ ------------ -----------
237,942,036 76,321,331 85,702,247 238,169,967 92,116,590 46,680,880 20,483,547
------------- ----------- ------------ ------------- ------------ ------------ -----------
0 6,442,638 133,021 0 0 947,861 278,125
106,798 36,355 34,112 75,003 63,679 51,382 39,361
378,935 178,286 28,474 9,540 0 0 0
28,543,878 0 0 0 0 0 0
257,655 49,547 108,826 289,843 120,487 72,393 30,082
14,219 0 632 0 0 511,256 0
0 1,749 0 0 0 0 0
------------- ----------- ------------ ------------- ------------ ------------ -----------
29,301,485 6,708,575 305,065 374,386 184,166 1,582,892 347,568
------------- ----------- ------------ ------------- ------------ ------------ -----------
$ 208,640,551 $69,612,756 $85,397,182 $237,795,581 $91,932,424 $45,097,988 $20,135,979
============= =========== =========== ============ =========== =========== ===========
$ 4,290,016 $ 232,236 $13,219,824 $ 50,656,810 $13,075,722 $ 6,909,407 $ 2,102,119
(14,603,707) (201,291) 763,206 14,246,742 4,612,083 2,008,429 (290,420)
0 0 4,996 4,591 246,749 108,867 (99,076)
218,954,242 69,581,811 71,409,156 172,887,438 73,997,870 36,071,285 18,423,356
------------- ----------- ------------ ------------- ------------ ------------ -----------
$ 208,640,551 $69,612,756 $85,397,182 $237,795,581 $91,932,424 $45,097,988 $20,135,979
============= =========== =========== ============ =========== =========== ===========
$ 201,746,423 $61,733,774 $75,171,864 $217,502,971 $78,232,347 $38,878,553 $17,796,172
19,824,513 12,021,517 5,004,756 10,021,034 4,198,586 2,670,251 1,261,393
$ 10.18 $ 5.14 $ 15.02 $ 21.70 $ 18.63 $ 14.56 $ 14.11
$ 6,894,128 $ 7,878,982 $10,225,318 $ 20,292,610 $13,700,077 $ 6,219,435 $ 2,339,807
677,390 1,536,408 683,400 938,307 745,151 433,055 167,280
$ 10.18 $ 5.13 $ 14.96 $ 21.63 $ 18.39 $ 14.36 $ 13.99
50,000,000 50,000,000 20,000,000 20,000,000 10,000,000 15,000,000 15,000,000
============= =========== =========== ============ =========== =========== ===========
35
</TABLE>
<PAGE>
<TABLE>
Statements of Operations For the six months ended June 30, 1998 (unaudited)
- -----------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Money Funds Bond Funds
-----------------------------------------------------------------------------
California National California National
U.S. Treasury Municipal Municipal Municipal Municipal
Money Fund Money Fund Money Fund Bond Fund Bond Fund
-----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Investment Income:
Income:
Interest ......................................... $ 1,531,059 $ 762,827 $ 108,133 $ 5,623,114 $ 1,711,238
Dividends ........................................ 0 0 0 0 0
------------- ------------- ------------- ------------- -------------
Total income ...................................... 1,531,059 762,827 108,133 5,623,114 1,711,238
------------- ------------- ------------- ------------- -------------
Expenses:
Management fees (Note 6) ......................... 145,893 110,850 15,023 569,228 171,914
12b-1 fees: (Note 6)
Class A ......................................... 72,679 55,425 7,512 248,730 74,187
Class B ......................................... 802 0 0 30,030 11,868
Transfer agency fees and expenses ................ 57,742 15,478 4,553 59,709 26,377
Custodian fees and expenses ...................... 18,160 20,271 5,456 57,694 18,113
Directors' fees .................................. 1,521 1,155 157 5,389 1,628
Registration fees ................................ 902 1,175 565 2,223 1,092
Accounting and legal fees ........................ 8,452 7,882 7,703 9,147 8,471
Printing and postage ............................. 5,327 1,756 421 6,591 2,532
Other ............................................ 1,227 617 77 1,868 2,699
------------- ------------- ------------- ------------- -------------
Gross expenses .................................... 312,705 214,609 41,467 990,609 318,881
Waiver of management fees (Note 6) ............... (57,330) (16,128) (13,731) 0 0
Waiver of 12b-1 fees: (Note 6)
Class A ......................................... (72,679) (55,425) (7,512) 0 0
Class B ......................................... 0 0 0 0 0
Expense reimbursement (Note 6) .................... (8,140) 0 (243) (7,735) (7,956)
------------- ------------- ------------- ------------- -------------
Net expenses ...................................... 174,556 143,056 19,981 982,874 310,925
------------- ------------- ------------- ------------- -------------
Net investment income (loss) ...................... 1,356,503 619,771 88,152 4,640,240 1,400,313
------------- ------------- ------------- ------------- -------------
Realized Gain (Loss) and Unrealized
Appreciation (Depreciation) on Investments
and Foreign Currency:
Realized gain (loss):
Proceeds from sales (including premiums
on options exercised) ............................ 131,614,816 47,470,660 4,133,306 22,509,363 10,846,856
Cost of securities sold .......................... (131,617,400) (47,470,660) (4,133,306) (20,753,050) (10,314,313)
Loss on closing of future contracts .............. 0 0 0 0 0
Gain on closing and expiration of
options written .................................. 0 0 0 0 0
Gain (loss) on foreign currency
transactions ..................................... 0 0 0 0 0
------------- ------------- ------------- ------------- -------------
Net realized gain (loss) .......................... (2,584) 0 0 1,756,313 532,543
------------- ------------- ------------- ------------- -------------
Unrealized appreciation (depreciation):
Beginning of period .............................. 0 0 0 15,061,778 4,480,008
End of period .................................... 0 0 0 13,618,599 4,018,522
------------- ------------- ------------- ------------- -------------
Unrealized appreciation (depreciation) ............ 0 0 0 (1,443,179) (461,486)
------------- ------------- ------------- ------------- -------------
Net realized gain (loss) and unrealized
appreciation (depreciation) on investments
and foreign currency .............................. (2,584) 0 0 313,134 71,057
------------- ------------- ------------- ------------- -------------
Net increase in net assets resulting from
operations ........................................ $ 1,353,919 $ 619,771 $ 88,152 $ 4,953,374 $ 1,471,370
============= ============= ============= ============= =============
<FN>
36 The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
- -------------------------------------------------------------------------------------------------------------------
Stock Funds
- -------------------------------------------------------------------------------------------------------------------
<CAPTION>
U.S. Government Strategic Emerging
and Mortgage Income Balanced Growth and Strategic Global Growth
Securities Fund Fund Fund Income Fund Growth Fund Growth Fund Fund
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$ 7,611,812 $ 2,312,049 $ 972,497 $ 825,429 $ 463,756 $ 98,433 $ 62,438
0 38,254 621,912 1,215,934 291,949 325,825 5,121
------------- ------------- ------------ ------------- ------------- ------------- ------------
7,611,812 2,350,303 1,594,409 2,041,363 755,705 424,258 67,559
------------- ------------- ------------ ------------- ------------- ------------- ------------
571,445 220,783 253,947 691,479 288,173 162,598 65,029
250,906 63,589 78,180 242,945 86,148 43,182 17,420
26,526 30,017 37,544 73,015 50,314 22,889 8,704
108,079 39,177 34,394 82,459 39,911 27,796 21,345
93,488 64,568 20,302 56,066 20,908 56,718 15,953
5,413 1,526 1,881 5,553 2,136 1,055 420
1,548 6,644 6,514 4,961 4,867 2,180 2,488
9,151 9,458 8,517 9,177 8,563 8,369 8,255
11,776 4,295 6,419 15,059 8,178 4,485 3,162
8,158 2,201 2,062 8,359 2,429 1,522 605
------------- ------------- ------------ ------------- ------------- ------------- ------------
1,086,490 442,258 449,760 1,189,073 511,627 330,794 143,381
0 (144,054) 0 0 0 0 (607)
0 (63,589) 0 0 0 0 (9,028)
0 0 0 0 0 0 0
(7,493) (4,895) (4,954) (5,663) (2,975) (5,506) (5,757)
------------- ------------- ------------ ------------- ------------- ------------- ------------
1,078,997 229,720 444,806 1,183,410 508,652 325,288 127,989
------------- ------------- ------------ ------------- ------------- ------------- ------------
6,532,815 2,120,583 1,149,603 857,953 247,053 98,970 (60,430)
------------- ------------- ------------ ------------- ------------- ------------- ------------
35,552,018 77,741,170 3,847,854 78,391,097 27,905,525 13,297,105 6,405,266
(35,573,311) (77,907,572) (3,084,605) (64,097,359) (23,293,425) (10,880,480) (6,523,706)
0 (72,404) 0 0 0 (172,659) 0
0 20,320 0 0 0 0 0
0 81,901 0 0 0 (31,573) 0
------------- ------------- ------------ ------------- ------------- ------------- ------------
(21,293) (136,585) 763,249 14,293,738 4,612,100 2,212,393 (118,440)
------------- ------------- ------------ ------------- ------------- ------------- ------------
4,669,088 507,661 10,015,224 35,439,347 7,983,127 3,941,347 923,489
4,290,016 232,236 13,219,824 50,656,810 13,075,722 6,909,407 2,102,119
------------- ------------- ------------ ------------- ------------- ------------- ------------
(379,072) (275,425) 3,204,600 15,217,463 5,092,595 2,968,060 1,178,630
------------- ------------- ------------ ------------- ------------- ------------- ------------
(400,365) (412,010) 3,967,849 29,511,201 9,704,695 5,180,453 1,060,190
------------- ------------- ------------ ------------- ------------- ------------- ------------
$ 6,132,450 $ 1,708,573 $ 5,117,452 $ 30,369,154 $ 9,951,748 $ 5,279,423 $ 999,760
============= ============= ============ ============= ============= ============= ============
37
</TABLE>
<PAGE>
<TABLE>
Statements of Changes in Net Assets
- ----------------------------------------------------------------------------------
<CAPTION>
Money Funds
-------------------------------
U.S. Treasury Money Fund
-------------------------------
1998(1) 1997(2)
<S> <C> <C>
Operations:
Net investment income (loss) .................. $ 1,356,503 $ 3,022,156
Net realized gain (loss) on investments and
foreign currency .............................. (2,584) (9,954)
Net unrealized appreciation (depreciation) on
investments and foreign currency ............ 0 0
-------------- --------------
Net increase in net assets resulting from
operations .................................... 1,353,919 3,012,202
-------------- --------------
Distributions Paid to Shareholders:
Dividends from net investment income:
Class A .................................... (1,352,347) (3,016,389)
Class B .................................... (4,156) (5,767)
Distributions from net realized gain on
investments:
Class A .................................... 0 0
Class B .................................... 0 0
Distributions in excess of net realized gain on
investments:
Class A .................................... 0 0
Class B .................................... 0 0
-------------- --------------
Total distributions:
Class A .................................... (1,352,347) (3,016,389)
Class B .................................... (4,156) (5,767)
-------------- --------------
Capital Share Transactions: (Note 4)
Proceeds from shares sold:
Class A .................................... 24,527,810 68,097,818
Class B .................................... 174,008 516,184
Proceeds from shares issued in reinvestment
of net investment income dividends and
capital gain dividends:
Class A .................................... 1,282,491 2,850,286
Class B .................................... 3,866 5,656
Proceeds from shares issued in plan of
reorganization: (Note 7)
Class A .................................... NA NA
Class B .................................... NA NA
Cost of shares redeemed:
Class A .................................... (28,955,720) (76,384,832)
Class B .................................... (139,435) (477,242)
-------------- --------------
Net increase (decrease) in net assets resulting
from capital share transactions:
Class A .................................... (3,145,419) (5,436,728)
Class B .................................... 38,439 44,598
-------------- --------------
Net increase (decrease) in net assets ......... (3,109,564) (5,402,084)
Net Assets:
Beginning of period ........................... 60,197,368 65,599,452
-------------- --------------
End of period ................................. $ 57,087,804 $ 60,197,368
============== ==============
</TABLE>
<TABLE>
<CAPTION>
---------------------------------------------------------------
California Municipal Money National Municipal Money
Fund Fund
---------------------------------------------------------------
1998(1) 1997(2) 1998(1) 1997(2)
<S> <C> <C> <C> <C>
Operations:
Net investment income (loss) .................. $ 619,771 $ 1,360,691 $ 88,152 $ 211,211
Net realized gain (loss) on investments and
foreign currency .............................. 0 0 0 0
Net unrealized appreciation (depreciation) on
investments and foreign currency ............ 0 0 0 0
-------------- -------------- ------------- -------------
Net increase in net assets resulting from
operations .................................... 619,771 1,360,691 88,152 211,211
-------------- -------------- ------------- -------------
Distributions Paid to Shareholders:
Dividends from net investment income:
Class A .................................... (619,771) (1,360,691) (88,152) (211,211)
Class B .................................... NA NA NA NA
Distributions from net realized gain on
investments:
Class A .................................... 0 0 0 0
Class B .................................... NA NA NA NA
Distributions in excess of net realized gain on
investments:
Class A .................................... 0 0 0 0
Class B .................................... NA NA NA NA
-------------- -------------- ------------- -------------
Total distributions:
Class A .................................... (619,771) (1,360,691) (88,152) (211,211)
Class B .................................... NA NA NA NA
-------------- -------------- ------------- -------------
Capital Share Transactions: (Note 4)
Proceeds from shares sold:
Class A .................................... 16,758,443 35,349,812 1,297,080 4,627,679
Class B .................................... NA NA NA NA
Proceeds from shares issued in reinvestment
of net investment income dividends and
capital gain dividends:
Class A .................................... 593,061 1,301,283 80,933 195,422
Class B .................................... NA NA NA NA
Proceeds from shares issued in plan of
reorganization: (Note 7)
Class A .................................... NA NA NA NA
Class B .................................... NA NA NA NA
Cost of shares redeemed:
Class A .................................... (20,472,912) (29,255,049) (2,548,082) (5,758,124)
Class B .................................... NA NA NA NA
-------------- -------------- ------------- -------------
Net increase (decrease) in net assets resulting
from capital share transactions:
Class A .................................... (3,121,408) 7,396,046 (1,170,069) (935,023)
Class B .................................... NA NA NA NA
-------------- -------------- ------------- -------------
Net increase (decrease) in net assets ......... (3,121,408) 7,396,046 (1,170,069) (935,023)
Net Assets:
Beginning of period ........................... 44,750,725 37,354,679 6,578,674 7,513,697
-------------- -------------- ------------- -------------
End of period ................................. $ 41,629,317 $ 44,750,725 $ 5,408,605 $ 6,578,674
============== ============== ============= =============
<FN>
(1) For the six months ended June 30, 1998 (unaudited).
(2) For the year ended December 31, 1997.
38 The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
Bond Funds
- -----------------------------------------------------------------------------------------------------------------------------
U.S. Government and
California Municipal Bond Fund National Municipal Bond Fund Mortgage Securities Fund Strategic Income Fund
- -----------------------------------------------------------------------------------------------------------------------------
1998(1) 1997(2) 1998(1) 1997(2) 1998(1) 1997(2) 1998(1) 1997(2)
<S> <C> <C> <C> <C> <C> <C> <C>
$ 4,640,240 $ 8,653,134 $ 1,400,313 $ 2,410,172 $ 6,532,815 $ 14,286,324 $ 2,120,583 $ 2,830,078
1,756,313 1,474,622 532,543 398,550 (21,293) (244,092) (136,585) 444,741
(1,443,179) 3,988,877 (461,486) 1,449,106 (379,072) 2,749,954 (275,425) 45,160
- ------------- ------------- ------------ ------------ ------------- ------------- ------------ ------------
4,953,374 14,116,633 1,471,370 4,257,828 6,132,450 16,792,186 1,708,573 3,319,979
- ------------- ------------- ------------ ------------ ------------- ------------- ------------ ------------
(4,479,817) (8,385,957) (1,337,162) (2,307,579) (6,327,344) (13,901,440) (1,857,408) (2,432,367)
(160,423) (267,177) (63,151) (102,593) (205,471) (384,884) (263,175) (397,711)
61 (685,771) 15 (351,308) 0 0 0 (348,740)
0 (28,111) 0 (18,891) 0 0 0 (74,340)
0 0 0 0 0 0 0 (53,357)
0 0 0 0 0 0 0 (11,349)
- ------------- ------------- ------------ ------------ ------------- ------------- ------------ ------------
(4,479,756) (9,071,728) (1,337,147) (2,658,887) (6,327,344) (13,901,440) (1,857,408) (2,834,464)
(160,423) (295,288) (63,151) (121,484) (205,471) (384,884) (263,175) (483,400)
- ------------- ------------- ------------ ------------ ------------- ------------- ------------ ------------
18,262,310 13,919,901 4,238,009 3,123,494 17,757,215 13,088,394 29,780,296 27,268,285
154,747 2,370,366 88,090 998,091 123,051 1,753,314 253,261 5,458,885
3,098,157 6,400,559 1,027,885 2,097,782 4,007,774 8,705,129 1,020,284 1,398,356
119,037 223,688 55,293 106,431 141,856 264,317 144,725 298,986
NA 16,888,793 NA 9,809,295 NA 3,487,178 NA NA
NA 580,661 NA 250,984 NA 316,243 NA NA
(13,990,066) (24,081,818) (4,178,488) (7,289,081) (22,207,188) (49,439,078) (6,520,290) (8,718,703)
(289,803) (688,795) (146,340) (221,250) (583,239) (1,069,258) (532,431) (656,792)
- ------------- ------------- ------------ ------------ ------------- ------------- ------------ ------------
7,370,401 13,127,435 1,087,406 7,741,490 (442,199) (24,158,377) 24,280,290 19,947,938
(16,019) 2,485,920 (2,957) 1,134,256 (318,332) 1,264,616 (134,445) 5,101,079
- ------------- ------------- ------------ ------------ ------------- ------------- ------------ ------------
7,667,577 20,362,972 1,155,521 10,353,203 (1,160,896) (20,387,899) 23,733,835 25,051,132
203,316,389 182,953,417 61,901,654 51,548,451 209,801,447 230,189,346 45,878,921 20,827,789
- ------------- ------------- ------------ ------------ ------------- ------------- ------------ ------------
$210,983,966 $ 203,316,389 $63,057,175 $61,901,654 $ 208,640,551 $209,801,447 $69,612,756 $ 45,878,921
============= ============= ============ ============ ============= ============= ============ ============
39
</TABLE>
<PAGE>
Statements of Changes in Net Assets
- --------------------------------------------------------------------------------
Stock Funds
-----------------------------
Balanced Fund
-----------------------------
1998(1) 1997(2)
Operations:
Net investment income (loss) .................. $ 1,149,603 $ 1,603,695
Net realized gain (loss) on investments and
foreign currency .............................. 763,249 1,240,561
Net unrealized appreciation (depreciation) on
investments and foreign currency ............ 3,204,600 6,602,853
------------- ------------
Net increase in net assets resulting from
operations .................................... 5,117,452 9,447,109
------------- ------------
Distributions Paid to Shareholders:
Dividends from net investment income:
Class A .................................... (1,019,194) (1,386,825)
Class B .................................... (125,402) (216,881)
Distributions from net realized gain on
investments:
Class A .................................... (22) (1,038,635)
Class B .................................... 0 (201,932)
Distributions in excess of net realized gain on
investments:
Class A .................................... 0 0
Class B .................................... 0 0
------------- ------------
Total distributions:
Class A .................................... (1,019,216) (2,425,460)
Class B .................................... (125,402) (418,813)
------------- ------------
Capital Share Transactions: (Note 4)
Proceeds from shares sold:
Class A .................................... 25,848,908 17,048,097
Class B .................................... 257,691 3,970,037
Proceeds from shares issued in reinvestment
of net investment income dividends and
capital gain dividends:
Class A .................................... 981,699 2,319,578
Class B .................................... 114,802 393,826
Proceeds from shares issued in plan of
reorganization: (Note 7)
Class A .................................... NA NA
Class B .................................... NA NA
Cost of shares redeemed:
Class A .................................... (4,497,643) (4,835,402)
Class B .................................... (288,721) (582,207)
------------- ------------
Net increase (decrease) in net assets resulting
from capital share transactions:
Class A .................................... 22,332,964 14,532,273
Class B .................................... 83,772 3,781,656
------------- ------------
Net increase (decrease) in net assets ......... 26,389,570 24,916,765
Net Assets:
Beginning of period ........................... 59,007,612 34,090,847
------------- ------------
End of period ................................. $ 85,397,182 $ 59,007,612
============= ============
<TABLE>
<CAPTION>
--------------------------------------------------------------
Growth and Income Fund Strategic Growth Fund
--------------------------------------------------------------
1998(1) 1997(2) 1998(1) 1997(2)
<S> <C> <C> <C> <C>
Operations:
Net investment income (loss) .................. $ 857,953 $ 830,450 $ 247,053 $ 376,346
Net realized gain (loss) on investments and
foreign currency .............................. 14,293,738 30,340,392 4,612,100 4,898,258
Net unrealized appreciation (depreciation) on
investments and foreign currency ............ 15,217,463 9,147,300 5,092,595 4,495,615
------------- ------------- ------------ ------------
Net increase in net assets resulting from
operations .................................... 30,369,154 40,318,142 9,951,748 9,770,219
------------- ------------- ------------ ------------
Distributions Paid to Shareholders:
Dividends from net investment income:
Class A .................................... (821,803) (806,041) 0 (343,591)
Class B .................................... (31,330) (24,417) 0 (32,774)
Distributions from net realized gain on
investments:
Class A .................................... 0 (27,435,529) 0 (3,980,719)
Class B .................................... 0 (2,892,139) 0 (917,571)
Distributions in excess of net realized gain on
investments:
Class A .................................... 0 (42,719) 0 0
Class B .................................... 0 (4,479) 0 0
------------- ------------- ------------ ------------
Total distributions:
Class A .................................... (821,803) (28,284,289) 0 (4,324,310)
Class B .................................... (31,330) (2,921,035) 0 (950,345)
------------- ------------- ------------ ------------
Capital Share Transactions: (Note 4)
Proceeds from shares sold:
Class A .................................... 29,985,071 29,480,304 20,142,677 28,322,529
Class B .................................... 467,556 3,625,538 433,197 5,429,227
Proceeds from shares issued in reinvestment
of net investment income dividends and
capital gain dividends:
Class A .................................... 806,832 27,713,680 0 4,304,676
Class B .................................... 30,454 2,839,849 0 934,030
Proceeds from shares issued in plan of
reorganization: (Note 7)
Class A .................................... NA NA NA NA
Class B .................................... NA NA NA NA
Cost of shares redeemed:
Class A .................................... (13,882,288) (30,472,282) (4,533,914) (4,215,490)
Class B .................................... (1,150,854) (1,308,132) (714,953) (559,000)
------------- ------------- ------------ ------------
Net increase (decrease) in net assets resulting
from capital share transactions:
Class A .................................... 16,909,615 26,721,702 15,608,763 28,411,715
Class B .................................... (652,844) 5,157,255 (281,756) 5,804,257
------------- ------------- ------------ ------------
Net increase (decrease) in net assets ......... 45,772,792 40,991,775 25,278,755 38,711,536
Net Assets:
Beginning of period ........................... 192,022,789 151,031,014 66,653,669 27,942,133
------------- ------------- ------------ ------------
End of period ................................. $ 237,795,581 $ 192,022,789 $ 91,932,424 $ 66,653,669
============= ============= ============ ============
<FN>
(1)For the six months ended June 30, 1998 (unaudited).
(2)For the year ended December 31, 1997.
(3)For the period April 30, 1997 (inception of operations) to December 31, 1997.
40 The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
<PAGE>
- --------------------------------------------------------------------------------
- -----------------------------------------------------------------
Global Growth Fund Emerging Growth Fund
- -----------------------------------------------------------------
1998(1) 1997(2) 1998(1) 1997(3)
$ 98,970 $ 15,339 $ (60,430) $ (38,646)
2,212,393 2,239,705 (118,440) (171,980)
2,968,060 2,939,358 1,178,630 923,489
------------ ------------ ------------ -----------
5,279,423 5,194,402 999,760 712,863
------------ ------------ ------------ -----------
0 (179) 0 0
0 0 0 0
0 (1,858,023) 0 0
0 (363,901) 0 0
0 (170,942) 0 0
0 (33,022) 0 0
------------ ------------ ------------ -----------
0 (2,029,144) 0 0
0 (396,923) 0 0
------------ ------------ ------------ -----------
7,579,481 16,216,002 8,142,357 9,939,204
84,617 2,980,894 101,877 2,304,201
0 2,014,769 0 0
0 392,224 0 0
NA NA NA NA
NA NA NA NA
(2,640,397) (4,745,878) (1,198,051) (576,187)
(363,478) (230,205) (173,153) (116,892)
------------ ------------ ------------ -----------
4,939,084 13,484,893 6,944,306 9,363,017
(278,861) 3,142,913 (71,276) 2,187,309
------------ ------------ ------------ -----------
9,939,646 19,396,141 7,872,790 12,263,189
35,158,342 15,762,201 12,263,189 0
------------ ------------ ------------ -----------
$ 45,097,988 $ 35,158,342 $20,135,979 $12,263,189
============ ============ ============ ===========
41
<PAGE>
<TABLE>
Financial Highlights selected data for a share outstanding throughout each period
- -----------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Money Funds
--------------------------------------------------------------------------
U.S. Treasury Money Fund
Class A
--------------------------------------------------------------------------
1998(1) 1997(2) 1996(2) 1995(2) 1994(2) 1993(2)
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ............ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ---------- ----------
Income From Investment Operations:
Net investment income (loss) .................. 0.023 0.046 0.046 0.050 0.036 0.030
Net gain or loss on securities
(both realized and unrealized) .................. 0.000 0.000 0.000 0.000 0.000 0.000
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations ............... 0.023 0.046 0.046 0.050 0.036 0.030
---------- ---------- ---------- ---------- ---------- ----------
Less Distributions:
Dividends (from net investment income) ......... (0.023) (0.046) (0.046) (0.050) (0.036) (0.030)
Distributions (from realized capital gains) 0.000 0.000 0.000 0.000 0.000 0.000
Distributions (in excess of realized gains) ..... 0.000 0.000 0.000 0.000 0.000 0.000
---------- ---------- ---------- ---------- ---------- ----------
Total distributions ........................... (0.023) (0.046) (0.046) (0.050) (0.036) (0.030)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value, end of period .................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ========== ========== ========== ========== ==========
Total return(4) .................................. 2.35% 4.73% 4.74% 5.13% 3.67% 3.03%
Ratios/Supplemental Data:
Net assets, end of period (000's) ............... $ 56,885 $ 60,033 $ 65,479 $ 51,385 $ 33,448 $ 14,168
Ratio of expenses to average
net assets (annualized)(6) ..................... 0.60% 0.62% 0.52% 0.64% 0.46% 0.15%
Ratio of net investment income to average
net assets (annualized) ........................ 4.69% 4.63% 4.63% 4.99% 3.75% 2.98%
Portfolio turnover rate (Note 5) ............... -- -- -- -- -- --
Average commission rate paid(5) ................. -- -- -- -- -- --
</TABLE>
<TABLE>
<CAPTION>
Class B
--------------------------------------------------------------
1998(1) 1997(2) 1996(2) 1995(2) 1994(3)
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ............ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ----------
Income From Investment Operations:
Net investment income (loss) .................. 0.020 0.039 0.040 0.044 0.018
Net gain or loss on securities
(both realized and unrealized) .................. 0.000 0.000 0.000 0.000 0.000
---------- ---------- ---------- ---------- ----------
Total from investment operations ............... 0.020 0.039 0.040 0.044 0.018
---------- ---------- ---------- ---------- ----------
Less Distributions:
Dividends (from net investment income) ......... (0.020) (0.039) (0.040) (0.044) (0.018)
Distributions (from realized capital gains) .... 0.000 0.000 0.000 0.000 0.000
Distributions (in excess of realized gains) .... 0.000 0.000 0.000 0.000 0.000
---------- ---------- ---------- ---------- ----------
Total distributions ........................... (0.020) (0.039) (0.040) (0.044) (0.018)
---------- ---------- ---------- ---------- ----------
Net asset value, end of period .................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ========== ========== ========== ==========
Total return(4) .................................. 1.97% 3.95% 4.07% 4.45% 3.53%
Ratios/Supplemental Data:
Net assets, end of period (000's) ............... $ 203 $ 165 $ 120 $ 113 $ 28
Ratio of expenses to average
net assets (annualized)(6) ..................... 1.34% 1.37% 1.18% 1.24% 1.13%
Ratio of net investment income to average
net assets (annualized) ........................ 3.92% 3.90% 3.95% 4.34% 3.71%
Portfolio turnover rate (Note 5) ............... -- -- -- -- --
Average commission rate paid(5) ................. -- -- -- -- --
<FN>
(1) For the six months ended June 30, 1998 (unaudited).
(2) For the year ended December 31.
(3) For the period July 1, 1994 (inception of operations) to December 31, 1994.
(4) Total returns assume purchase at net asset value (without sales charge) at
the beginning of each period. Returns for periods less than a full year are
aggregate (non-annualized) returns.
(5) Initiating with fiscal year 1996, the Funds are required to disclose their
average commission rate per share for purchases and sales of equity
securities.
(6) Effective January 10, 1990, the Distributor and Adviser for the Atlas Funds
agreed to temporarily cap (or waive) their management and 12b-1 fees and to
absorb other operating expenses. Had such action not been taken, the ratio
of expenses to average net assets (annualized) would have been as follows:
</FN>
</TABLE>
<TABLE>
<CAPTION>
Class A Class B
Period Ended 1998(1) 1997 1996 1995 1994 1993 1998(1) 1997 1996 1995 1994
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
U.S. Treasury Money Fund ............ 1.05% 1.02% 1.02% 1.05% 1.08% 1.10% 3.25% 3.25% 3.25% 3.25% 3.25%
California Municipal Money Fund ..... 0.98% 0.97% 1.00% 1.00% 1.00% 0.98% NA NA NA NA NA
National Municipal Money Fund ...... 1.39% 1.31% 1.32% 1.29% 1.25% 1.28% NA NA NA NA NA
<FN>
42 The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
- -------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
California Municipal Money Fund National Municipal Money Fund
Class A Class A
- -------------------------------------------------------------------------------------------------------------------------------
1998(1) 1997(2) 1996(2) 1995(2) 1994(2) 1993(2) 1998(1) 1997(2) 1996(2) 1995(2)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
0.014 0.029 0.028 0.032 0.024 0.021 0.015 0.030 0.029 0.032
0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000
- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
0.014 0.029 0.028 0.032 0.024 0.021 0.015 0.030 0.029 0.032
- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
(0.014) (0.029) (0.028) (0.032) (0.024) (0.021) (0.015) (0.030) (0.029) (0.032)
0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000
0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000
- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
(0.014) (0.029) (0.028) (0.032) (0.024) (0.021) (0.015) (0.030) (0.029) (0.032)
- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
$ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ========== ========== ========== ========== ========== ========== ========== ========== ==========
1.41% 2.97% 2.82% 3.22% 2.47% 2.13% 1.48% 3.09% 2.96% 3.26%
$ 41,629 $ 44,751 $ 37,355 $ 39,439 $ 42,979 $ 45,784 $ 5,409 $ 6,579 $ 7,514 $ 7,860
0.65% 0.64% 0.63% 0.67% 0.46% 0.48% 0.67% 0.68% 0.68% 0.75%
2.82% 2.94% 2.78% 3.18% 2.44% 2.10% 2.96% 3.04% 2.92% 3.21%
-- -- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- -- --
</TABLE>
- ------------------------------
- ------------------------------
1994(2) 1993(2)
$ 1.00 $ 1.00
---------- ----------
0.026 0.022
0.000 0.000
---------- ----------
0.026 0.022
---------- ----------
(0.026) (0.022)
0.000 0.000
0.000 0.000
---------- ----------
(0.026) (0.022)
---------- ----------
$ 1.00 $ 1.00
========== ==========
2.60% 2.25%
$ 10,110 $ 9,424
0.49% 0.55%
2.57% 2.23%
-- --
-- --
43
<PAGE>
<TABLE>
Financial Highlights selected data for a share outstanding throughout each period
- ------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Bond Funds
--------------------------------------------------------------------
California Municipal Bond Fund
Class A
--------------------------------------------------------------------
1998(1) 1997(2) 1996(2) 1995(2) 1994(2)
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ............ $ 11.44 $ 11.15 $ 11.26 $ 10.31 $ 11.56
--------- --------- --------- --------- -----------
Income From Investment Operations:
Net investment income (loss) .................. 0.26 0.53 0.53 0.54 0.59
Net gain or loss on securities
(both realized and unrealized) ............... 0.02 0.33 (0.11) 0.95 (1.25)
--------- --------- --------- --------- -----------
Total from investment operations ............... 0.28 0.86 0.42 1.49 (0.66)
--------- --------- --------- --------- -----------
Less Distributions:
Dividends (from net investment income) ......... (0.26) (0.53) (0.53) (0.54) (0.59)
Distributions (from realized capital gains) .... 0.00 (0.04) 0.00 0.00 0.00
Distributions (in excess of realized gains) .... 0.00 0.00 0.00 0.00 0.00
--------- --------- --------- --------- -----------
Total distributions ........................... (0.26) (0.57) (0.53) (0.54) (0.59)
--------- --------- --------- --------- -----------
Net asset value, end of period .................. $ 11.46 $ 11.44 $ 11.15 $ 11.26 $ 10.31
========= ========= ========= ========= ===========
Total return(4) ................................. 2.45% 7.97% 3.90% 14.76% (5.83)%
Ratios/Supplemental Data:
Net assets, end of period (000's) .............. $ 202,964 $ 195,292 $ 177,593 $ 184,283 $ 171,768
Ratio of expenses to average
net assets (annualized)(6) ..................... 0.94% 0.95% 0.96% 0.93% 0.57%
Ratio of net investment income to average
net assets (annualized) ........................ 4.54% 4.76% 4.82% 4.98% 5.43%
Portfolio turnover rate (Note 5) ............... 11.10% 15.95% 29.28% 25.90% 30.32%
Average commission rate paid(5) ................. -- -- -- -- --
</TABLE>
<TABLE>
<CAPTION>
---------------------------------------------------------------------------
Class B
---------------------------------------------------------------------------
1993(2) 1998(1) 1997(2) 1996(2) 1995(2) 1994(3)
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ............ $ 10.74 $ 11.45 $ 11.15 $ 11.26 $ 10.32 $ 10.74
--------- ---------- ---------- ---------- ---------- ----------
Income From Investment Operations:
Net investment income (loss) .................. 0.59 0.23 0.48 0.48 0.48 0.25
Net gain or loss on securities
(both realized and unrealized) ............... 0.83 0.01 0.34 (0.11) 0.94 (0.42)
--------- ---------- ---------- ---------- ---------- ----------
Total from investment operations ............... 1.42 0.24 0.82 0.37 1.42 (0.17)
--------- ---------- ---------- ---------- ---------- ----------
Less Distributions:
Dividends (from net investment income) ......... (0.59) (0.23) (0.48) (0.48) (0.48) (0.25)
Distributions (from realized capital gains) ..... (0.01) 0.00 (0.04) 0.00 0.00 0.00
Distributions (in excess of realized gains) ..... 0.00 0.00 0.00 0.00 0.00 0.00
--------- ---------- ---------- ---------- ---------- ----------
Total distributions ........................... (0.60) (0.23) (0.52) (0.48) (0.48) (0.25)
--------- ---------- ---------- ---------- ---------- ----------
Net asset value, end of period .................. $ 11.56 $ 11.46 $ 11.45 $ 11.15 $ 11.26 $ 10.32
========= ========== ========== ========== ========== ==========
Total return(4) ................................. 13.52% 2.11% 7.53% 3.39% 14.05% (1.59)%
Ratios/Supplemental Data:
Net assets, end of period (000's) ............... $ 197,394 $ 8,020 $ 8,025 $ 5,360 $ 3,162 $ 1,416
Ratio of expenses to average
net assets (annualized)(6) ..................... 0.53% 1.44% 1.45% 1.46% 1.46% 1.23%
Ratio of net investment income to average
net assets (annualized) ........................ 5.25% 4.04% 4.24% 4.33% 4.42% 4.91%
Portfolio turnover rate (Note 5) ............... 7.44% 11.10% 15.95% 29.28% 25.90% 30.32%
Average commission rate paid(5) ................. -- -- -- -- -- --
<FN>
(1) For the six months ended June 30, 1998 (unaudited).
(2) For the year ended December 31.
(3) For the period July 1, 1994 (inception of operations) to December 31, 1994.
(4) Total returns assume purchase at net asset value (without sales charge) at
the beginning of each period. Returns for periods less than a full year are
aggregate (non-annualized) returns.
(5) Initiating with fiscal year 1996, the Funds are required to disclose their
average commission rate per share for purchases and sales of equity
securities.
(6) Effective January 10, 1990, the Distributor and Adviser for the Atlas Funds
agreed to temporarily cap (or waive) their management and 12b-1 fees and to
absorb other operating expenses. Had such action not been taken, the ratio
of expenses to average net assets (annualized) would have been as follows:
</FN>
</TABLE>
<TABLE>
<CAPTION>
Class A Class B
Period Ended 1998(1) 1997 1996 1995 1994 1993 1998(1) 1997 1996 1995 1994
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
California Municipal Bond Fund ...... 0.94% 0.95% 0.96% 0.96% 0.97% 0.98% 1.63% 1.70% 1.83% 2.24% 3.25%
National Municipal Bond Fund ........ 0.98% 1.00% 1.01% 1.05% 1.06% 1.06% 1.98% 2.13% 2.29% 3.25% 3.25%
<FN>
44 The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
National Municipal Bond Fund
Class A
- --------------------------------------------------------------------------------
1998(1) 1997(2) 1996(2) 1995(2) 1994(2) 1993(2)
$ 11.54 $ 11.21 $ 11.39 $ 10.41 $ 11.61 $ 10.80
- ---------- ---------- ---------- ---------- ------------ ----------
0.26 0.53 0.52 0.53 0.58 0.60
0.02 0.40 (0.12) 0.98 (1.20) 0.82
- ---------- ---------- ---------- ---------- ------------ ----------
0.28 0.93 0.40 1.51 (0.62) 1.42
- ---------- ---------- ---------- ---------- ------------ ----------
(0.26) (0.53) (0.52) (0.53) (0.58) (0.60)
0.00 (0.07) (0.06) 0.00 0.00 (0.01)
0.00 0.00 0.00 0.00 0.00 0.00
- ---------- ---------- ---------- ---------- ------------ ----------
(0.26) (0.60) (0.58) (0.53) (0.58) (0.61)
- ---------- ---------- ---------- ---------- ------------ ----------
$ 11.56 $ 11.54 $ 11.21 $ 11.39 $ 10.41 $ 11.61
========= ========== ========== ========== ============ ==========
2.45% 8.56% 3.58% 14.76% (5.41)% 13.39%
$ 59,896 $ 58,740 $ 49,597 $ 53,387 $ 50,037 $ 57,590
0.98% 1.00% 1.01% 0.91% 0.57% 0.50%
4.54% 4.72% 4.63% 4.79% 5.35% 5.29%
17.91% 21.80% 44.76% 53.43% 37.52% 3.72%
-- -- -- -- -- --
- --------------------------------------------------------------------------------
National Municipal Bond Fund
Class B
- --------------------------------------------------------------------------------
1998(1) 1998(1) 1997(2) 1996(2) 1995(2) 1994(3)
$ 11.54 $ 11.55 $ 11.21 $ 11.39 $ 10.41 $ 10.76
- ---------- ---------- ---------- ---------- ---------- -------------
0.26 0.23 0.48 0.46 0.47 0.24
0.02 0.01 0.41 (0.12) 0.98 (0.35)
- ---------- ---------- ---------- ---------- ---------- -------------
0.28 0.24 0.89 0.34 1.45 (0.11)
- ---------- ---------- ---------- ---------- ---------- -------------
(0.26) (0.23) (0.48) (0.46) (0.47) (0.24)
0.00 0.00 (0.07) (0.06) 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00
- ---------- ---------- ---------- ---------- ---------- -------------
(0.26) (0.23) (0.55) (0.52) (0.47) (0.24)
- ---------- ---------- ---------- ---------- ---------- -------------
$ 11.56 $ 11.56 $ 11.55 $ 11.21 $ 11.39 $ 10.41
========== ========== ========== ========== ========== =============
2.45% 2.11% 8.11% 3.07% 14.16% (0.99)%
$ 59,896 $ 3,161 $ 3,162 $ 1,952 $ 1,051 $ 342
0.98% 1.47% 1.50% 1.51% 1.44% 1.28%
4.54% 4.02% 4.21% 4.14% 4.22% 4.72%
17.91% 17.91% 21.80% 44.76% 54.30% 37.52%
-- -- -- -- -- --
45
<PAGE>
<TABLE>
Financial Highlights selected data for a share outstanding throughout each period
- ----------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Bond Funds
-------------------------------------------------------------------------
U.S. Government and Mortgage Securities Fund
Class A
-------------------------------------------------------------------------
1998(1) 1997(2) 1996(2) 1995(2) 1994(2) 1993(2)
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ............ $ 10.20 $ 10.07 $ 10.30 $ 9.55 $ 10.60 $ 10.57
-------- -------- -------- -------- ------------ --------
Income From Investment Operations:
Net investment income (loss) .................. 0.32 0.67 0.67 0.69 0.70 0.74
Net gain or loss on securities
(both realized and unrealized) ................. (0.02) 0.13 (0.23) 0.75 (1.05) 0.03
-------- -------- -------- -------- ------------ --------
Total from investment operations ............... 0.30 0.80 0.44 1.44 (0.35) 0.77
-------- -------- -------- -------- ------------ --------
Less Distributions:
Dividends (from net investment income) ......... (0.32) (0.67) (0.67) (0.69) (0.70) (0.74)
Distributions (from realized capital gains) ..... 0.00 0.00 0.00 0.00 0.00 0.00
Distributions (in excess of realized gains) ..... 0.00 0.00 0.00 0.00 0.00 0.00
-------- -------- -------- -------- ------------ --------
Total distributions ........................... (0.32) (0.67) (0.67) (0.69) (0.70) (0.74)
-------- -------- -------- -------- ------------ --------
Net asset value, end of period .................. $ 10.18 $ 10.20 $ 10.07 $ 10.30 $ 9.55 $ 10.60
======== ======== ======== ======== ============ ========
Total return(6) .................................. 2.99% 8.25% 4.50% 15.50% (3.30)% 7.49%
RatiosSupplemental Data:
Net assets, end of period (000's) ............... $201,746 $202,573 $224,301 $255,614 $ 245,715 $311,089
Ratio of expenses to average
net assets (annualized)(8) ..................... 1.03% 1.03% 1.03% 1.02% 0.80% 0.78%
Ratio of net investment income to average
net assets (annualized) ........................ 6.36% 6.67% 6.67% 6.90% 7.05% 6.93%
Portfolio turnover rate (Note 5) ............... 14.86% 5.59% 27.45% 48.39% 16.33% 25.63%
Average commission rate paid(7) ................. -- -- -- -- -- --
</TABLE>
<TABLE>
<CAPTION>
----------------------------------------------------------
Class B
----------------------------------------------------------
1998(1) 1997(2) 1996(2) 1995(2) 1994(3)
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ............ $ 10.20 $ 10.07 $ 10.30 $ 9.55 $ 9.80
--------- --------- --------- --------- ---------
Income From Investment Operations:
Net investment income (loss) .................. 0.30 0.62 0.62 0.64 0.32
Net gain or loss on securities
(both realized and unrealized) ................. (0.02) 0.13 (0.23) 0.75 (0.25)
--------- --------- --------- --------- ---------
Total from investment operations ............... 0.28 0.75 0.39 1.39 0.07
--------- --------- --------- --------- ---------
Less Distributions:
Dividends (from net investment income) .......... (0.30) (0.62) (0.62) (0.64) (0.32)
Distributions (from realized capital gains) ..... 0.00 0.00 0.00 0.00 0.00
Distributions (in excess of realized gains) ..... 0.00 0.00 0.00 0.00 0.00
--------- --------- --------- --------- ---------
Total distributions ........................... (0.30) (0.62) (0.62) (0.64) (0.32)
--------- --------- --------- --------- ---------
Net asset value, end of period .................. $ 10.18 $ 10.20 $ 10.07 $ 10.30 $ 9.55
========= ========= ========= ========= =========
Total return(6) .................................. 2.74% 7.72% 3.98% 14.93% 0.69%
RatiosSupplemental Data:
Net assets, end of period (000's) ............... $ 6,894 $ 7,228 $ 5,888 $ 3,799 $ 1,451
Ratio of expenses to average
net assets (annualized)(8) ..................... 1.53% 1.53% 1.53% 1.53% 1.43%
Ratio of net investment income to average
net assets (annualized) ........................ 5.86% 6.16% 6.19% 6.34% 6.82%
Portfolio turnover rate (Note 5) ............... 14.86% 5.59% 27.45% 48.39% 16.33%
Average commission rate paid(7) ................. -- -- -- -- --
<FN>
(1) For the six months ended June 30, 1998 (unaudited).
(2) For the year ended December 31.
(3) For the period July 1, 1994 (inception of operations) to December 31, 1994.
(4) For the period May 20, 1996 (inception of operations) to December 31, 1996.
(5) For the period October 1, 1993 (inception of operations) to December 31,
1993.
(6) Total returns assume purchase at net asset value (without sales charge) at
the beginning of each period. Returns for periods less than a full year are
aggregate (non-annualized) returns.
(7) Initiating with fiscal year 1996, the Funds are required to disclose their
average commission rate per share for purchases and sales of equity
securities.
(8) Effective January 10, 1990, the Distributor and Adviser for the Atlas Funds
agreed to temporarily cap (or waive) their management and 12b-1 fees and to
absorb other operating expenses. Had such action not been taken, the ratio
of expenses to average net assets (annualized) would have been as follows:
</FN>
</TABLE>
<TABLE>
<CAPTION>
Class A Class B
Period Ended 1998(1) 1997 1996 1995 1994 1993 1998(1) 1997 1996 1995 1994
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
U.S. Government and Mortgage Securities . 1.03% 1.03% 1.03% 1.04% 1.05% 1.05% 1.74% 1.76% 1.82% 2.27% 3.25%
Strategic Income Fund .................. 1.42% 1.51% 1.85 NA NA NA 2.06% 2.27% 3.25 NA NA
Balanced Fund .......................... 1.16% 1.20% 1.28% 1.53% 1.56% 2.04% 1.77% 1.91% 2.21% 3.25% 3.25%
<FN>
46 The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Strategic Income Fund
Class A Class B
- --------------------------------------------------------------------------------
1998(1) 1997(2) 1996(4) 1998(1) 1997(2) 1996(4)
$ 5.16 $ 5.16 $ 5.00 $ 5.15 $ 5.15 $ 5.00
- --------- --------- --------- --------- --------- ---------
0.19 0.42 0.25 0.17 0.38 0.23
(0.02) 0.06 0.18 (0.02) 0.06 0.17
- --------- --------- --------- --------- --------- ---------
0.17 0.48 0.43 0.15 0.44 0.40
- --------- --------- --------- --------- --------- ---------
(0.19) (0.42) (0.25) (0.17) (0.38) (0.23)
0.00 (0.05) (0.01) 0.00 (0.05) (0.01)
0.00 (0.01) (0.01) 0.00 (0.01) (0.01)
- --------- --------- --------- --------- --------- ---------
(0.19) (0.48) (0.27) (0.17) (0.44) (0.25)
- --------- --------- --------- --------- --------- ---------
$ 5.14 $ 5.16 $ 5.16 $ 5.13 $ 5.15 $ 5.15
========= ========= ========= ========= ========= =========
3.34% 9.57% 8.89% 2.95% 8.77% 8.25%
$ 61,734 $ 37,831 $ 17,863 $ 7,879 $ 8,048 $ 2,964
0.68% 0.41% 0.02% 1.42% 1.16% 0.74%
7.34% 8.04% 8.19% 6.63% 7.29% 7.47%
122.64% 221.42% 187.15% 122.64% 221.42% 187.15%
-- -- -- -- -- --
<TABLE>
- ------------------------------------------------------------------------------------------------------------------
Stock Funds
- ------------------------------------------------------------------------------------------------------------------
<CAPTION>
Balanced Fund
Class A Class B
- ------------------------------------------------------------------------------------------------------------------
1998(1) 1997(2) 1996(2) 1995(2) 1994(2) 1993(5) 1998(1) 1997(2) 1996(2)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$ 14.14 $ 12.18 $ 11.19 $ 9.23 $ 9.85 $ 10.00 $ 14.09 $ 12.15 $ 11.17
- --------- --------- --------- ---------- ------------ ------------- --------- --------- ---------
0.22 0.46 0.42 0.42 0.44 0.09 0.20 0.41 0.36
0.88 2.27 1.32 2.02 (0.62) (0.15) 0.85 2.24 1.32
- --------- --------- --------- ---------- ------------ ------------- --------- --------- ---------
1.10 2.73 1.74 2.44 (0.18) (0.06) 1.05 2.65 1.68
- --------- --------- --------- ---------- ------------ ------------- --------- --------- ---------
(0.22) (0.46) (0.42) (0.42) (0.44) (0.09) (0.18) (0.40) (0.37)
0.00 (0.31) (0.33) (0.06) 0.00 0.00 0.00 (0.31) (0.33)
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
- --------- --------- --------- ---------- ------------ ------------- --------- --------- ---------
(0.22) (0.77) (0.75) (0.48) (0.44) (0.09) (0.18) (0.71) (0.70)
- --------- --------- --------- ---------- ------------ ------------- --------- --------- ---------
$ 15.02 $ 14.14 $ 12.18 $ 11.19 $ 9.23 $ 9.85 $ 14.96 $ 14.09 $ 12.15
========= ========= ========= ========== ============ ============= ========= ========= =========
7.80% 22.72% 15.81% 26.76% (1.87)% (0.62)% 7.49% 22.05% 15.25%
$75,172 $49,456 $29,289 $13,547 $ 9,654 $ 5,638 $10,225 $ 9,552 $ 4,802
1.16% 1.20% 1.28% 1.48% 0.80% 0.00% 1.67% 1.69% 1.77%
3.26% 3.58% 3.86% 4.15% 4.85% 5.02% 2.75% 3.07% 3.37%
6.78% 14.71% 41.41% 25.84% 29.19% 0.00% 6.78% 14.71% 41.41%
$0.0594 $0.0591 $0.0591 -- -- -- $0.0594 $0.0591 $0.0591
</TABLE>
- -----------------------
1995(2) 1994(3)
$ 9.22 $ 9.41
- ---------- ---------
0.35 0.10
2.03 (0.07)
- ---------- ---------
2.38 0.03
- ---------- ---------
(0.37) (0.22)
(0.06) 0.00
0.00 0.00
- ---------- ---------
(0.43) (0.22)
- ---------- ---------
$ 11.17 $ 9.22
========== =========
26.08% 0.25%
$ 1,632 $ 586
1.99% 1.48%
3.66% 4.43%
25.84% 29.19%
-- --
47
<PAGE>
<TABLE>
Financial Highlights selected data for a share outstanding throughout each period
- -----------------------------------------------------------------------------------------------------------------------
<CAPTION>
Stock Funds
----------------------------------------------------------------
Growth and Income Fund
Class A
----------------------------------------------------------------
1998(1) 1997(2) 1996(2) 1995(2) 1994(2)
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ............... $ 18.86 $ 17.82 $ 15.91 $ 13.52 $ 14.01
--------- --------- --------- ---------- ----------
Income From Investment Operations:
Net investment income (loss) ..................... 0.08 0.10 0.14 0.20 0.16
Net gain or loss on securities
(both realized and unrealized) .................. 2.84 4.58 3.06 4.26 (0.34)
--------- --------- --------- ---------- ----------
Total from investment operations .................. 2.92 4.68 3.20 4.46 (0.18)
--------- --------- --------- ---------- ----------
Less Distributions:
Dividends (from net investment income) ............ (0.08) (0.10) (0.14) (0.20) (0.16)
Distributions (from realized capital gains) ........ 0.00 (3.53) (1.15) (1.87) (0.12)
Distributions (in excess of realized gains) ........ 0.00 (0.01) 0.00 0.00 (0.03)
--------- --------- --------- ---------- ----------
Total distributions .............................. (0.08) (3.64) (1.29) (2.07) (0.31)
--------- --------- --------- ---------- ----------
Net asset value, end of period ..................... $ 21.70 $ 18.86 $ 17.82 $ 15.91 $ 13.52
========= ========= ========= ========== ==========
Total return(5) .................................... 15.52% 26.32% 20.16% 33.06% (1.24)%
Ratios/Supplemental Data:
Net assets, end of period (000's) ................. $217,503 $173,796 $138,604 $ 93,061 $ 69,590
Ratio of expenses to average
net assets (annualized)(7) ......................... 1.07% 1.10% 1.16% 1.24% 1.04%
Ratio of net investment income to average
net assets (annualized) ........................... 0.85% 0.51% 0.82% 1.26% 1.21%
Portfolio turnover rate (Note 5) .................. 39.18% 118.26% 86.66% 125.28% 123.64%
Average commission rate paid(6) .................... $ 0.0600 $ 0.0601 $ 0.0602 -- --
Class B
-------------------------------------------------------------
1993(2) 1998(1) 1997(2) 1996(2) 1995(2)
Net asset value, beginning of period ............... $ 13.45 $ 18.80 $ 17.78 $ 15.89 $ 13.52
--------- -------- ------- -------- ---------
Income From Investment Operations:
Net investment income (loss) ..................... 0.22 0.03 0.04 0.06 0.10
Net gain or loss on securities
(both realized and unrealized) .................... 1.17 2.83 4.55 3.05 4.26
--------- -------- ------- -------- ---------
Total from investment operations .................. 1.39 2.86 4.59 3.11 4.36
--------- -------- ------- -------- ---------
Less Distributions:
Dividends (from net investment income) ............ (0.22) (0.03) (0.03) (0.07) (0.12)
Distributions (from realized capital gains) ........ (0.59) 0.00 (3.53) (1.15) (1.87)
Distributions (in excess of realized gains) ........ (0.02) 0.00 (0.01) 0.00 0.00
--------- -------- ------- -------- ---------
Total distributions .............................. (0.83) (0.03) (3.57) (1.22) (1.99)
--------- -------- ------- -------- ---------
Net asset value, end of period ..................... $ 14.01 $ 21.63 $ 18.80 $ 17.78 $ 15.89
========= ======== ======= ======== =========
Total return(5) .................................... 10.40% 15.23% 25.82% 19.60% 32.32%
Ratios/Supplemental Data:
Net assets, end of period (000's) .................. $ 59,392 $ 20,293 $18,227 $ 12,427 $ 4,292
Ratio of expenses to average
net assets (annualized)(7) ......................... 1.06% 1.57% 1.49% 1.66% 1.75%
Ratio of net investment income to average
net assets (annualized) ........................... 1.59% 0.36% 0.14% 0.29% 0.84%
Portfolio turnover rate (Note 5) .................. 178.91% 39.18% 118.26% 86.66% 125.28%
Average commission rate paid(6) .................... -- $ 0.0600 $0.0601 $ 0.0602 --
</TABLE>
1994(3)
Net asset value, beginning of period ............... $ 13.04
----------
Income From Investment Operations:
Net investment income (loss) ..................... 0.02
Net gain or loss on securities
(both realized and unrealized) .................... 0.67
----------
Total from investment operations .................. 0.69
----------
Less Distributions:
Dividends (from net investment income) ............ (0.06)
Distributions (from realized capital gains) ........ (0.12)
Distributions (in excess of realized gains) ........ (0.03)
----------
Total distributions .............................. (0.21)
----------
Net asset value, end of period ..................... $ 13.52
==========
Total return(5) .................................... 5.32%
Ratios/Supplemental Data:
Net assets, end of period (000's) .................. $ 1,460
Ratio of expenses to average
net assets (annualized)(7) ......................... 1.66%
Ratio of net investment income to average
net assets (annualized) ........................... 0.71%
Portfolio turnover rate (Note 5) .................. 123.64%
Average commission rate paid(6) .................... --
(1) For the six months ended June 30, 1998 (unaudited).
(2) For the year ended December 31.
(3) For the period July 1, 1994 (inception of operations) to December 31, 1994.
(4) For the period October 1, 1993 (inception of operations) to December 31,
1993
(5) Total returns assume purchase at net asset value (without sales charge) at
the beginning of each period. Returns for periods less than a full year are
aggregate (non-annualized) returns.
(6) Initiating with fiscal year 1996, the Funds are required to disclose their
average commission rate per share for purchases and sales of equity
securities.
(7) Effective January 10, 1990, the Distributor and Adviser for the Atlas Funds
agreed to temporarily cap (or waive) their management and 12b-1 fees and to
absorb other operating expenses. Had such action not been taken, the ratio
of expenses to average net assets (annualized) would have been as follows:
<TABLE>
<CAPTION>
Class A Class B
Period Ended 1998(1) 1997 1996 1995 1994 1993 1998(1) 1997 1996 1995 1994
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Growth and Income Fund ...... 1.07% 1.10% 1.16% 1.24% 1.28% 1.36% 1.63% 1.69% 1.83% 2.39% 3.25%
Strategic Growth Fund ...... 1.16% 1.21% 1.31% 1.65% 1.74% 2.23% 1.71% 1.82% 2.12% 3.25% 3.25%
<FN>
48 The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Strategic Growth Fund
Class A
- -------------------------------------------------------------------------------
1998(1) 1997(2) 1996(2) 1995(2) 1994(2) 1993(4)
$ 16.36 $ 14.01 $ 12.69 $ 10.00 $ 10.14 $ 10.00
- --------- --------- --------- --------- ---------- ---------
0.06 0.11 0.13 0.10 0.11 0.05
2.21 3.65 2.88 2.82 (0.14) 0.14
- --------- --------- --------- --------- ---------- ---------
2.27 3.76 3.01 2.92 (0.03) 0.19
- --------- --------- --------- --------- ---------- ---------
0.00 (0.11) (0.13) (0.09) (0.11) (0.05)
0.00 (1.30) (1.56) (0.14) 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00
- --------- --------- --------- --------- ---------- ---------
0.00 (1.41) (1.69) (0.23) (0.11) (0.05)
- --------- --------- --------- --------- ---------- ---------
$ 18.63 $ 16.36 $ 14.01 $ 12.69 $ 10.00 $ 10.14
========= ========= ========= ========= ========== =========
13.88% 26.89% 23.72% 29.14% (0.28)% 1.94%
$ 78,232 $ 54,310 $ 22,253 $ 12,223 $ 6,471 $ 4,168
1.16% 1.21% 1.31% 1.62% 1.17% 0.00%
0.68% 0.86% 1.08% 1.03% 1.25% 2.66%
44.04% 85.55% 119.87% 73.32% 54.01% 6.41%
$ 0.0588 $ 0.0582 $ 0.0597 -- -- --
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Class B
- -------------------------------------------------------------------------------
1998(1) 1997(2) 1996(2) 1995(2) 1994(2) 1993(4)
$ 16.36 $ 16.22 $ 13.92 $ 12.63 $ 9.98 $ 9.92
- --------- --------- --------- --------- ---------- ---------
0.06 0.02 0.05 0.07 0.03 (0.05)
2.21 2.15 3.60 2.85 2.82 0.21
- --------- --------- --------- --------- ---------- ---------
2.27 2.17 3.65 2.92 2.85 0.16
- --------- --------- --------- --------- ---------- ---------
0.00 0.00 (0.05) (0.07) (0.06) (0.10)
0.00 0.00 (1.30) (1.56) (0.14) 0.00
0.00 0.00 0.00 0.00 0.00 0.00
- --------- --------- --------- --------- ---------- ---------
0.00 0.00 (1.35) (1.63) (0.20) (0.10)
- --------- --------- --------- --------- ---------- ---------
$ 18.63 $ 18.39 $ 16.22 $ 13.92 $ 12.63 $ 9.98
========= ========= ========= ========= ========== =========
13.88% 13.38% 26.23% 23.13% 28.58% 1.57%
$ 78,232 $ 13,700 $ 12,344 $ 5,689 $ 2,332 $ 327
1.16% 1.66% 1.71% 1.81% 2.14% 1.80%
0.68% 0.19% 0.37% 0.59% 0.56% 0.82%
44.04% 44.04% 85.55% 119.87% 73.32% 54.01%
$ 0.0588 $ 0.0588 $ 0.0582 $ 0.0597 -- --
49
<PAGE>
<TABLE>
Financial Highlights selected data for a share outstanding throughout each period
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Stock Funds
----------------------------------------------------------------------------------
Global Growth Fund
Class A Class B
----------------------------------------------------------------------------------
1998(1) 1997(2) 1996(3) 1998(1) 1997(2) 1996(3)
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........... $ 12.69 $ 10.96 $ 10.14 $ 12.55 $ 10.91 $ 10.14
-------- -------- -------- -------- -------- --------
Income From Investment Operations:
Net investment income (loss) .................. 0.04 0.02 0.01 0.00 (0.05) (0.03)
Net gain or loss on securities
(both realized and unrealized) ................ 1.83 2.65 1.10 1.81 2.63 1.08
-------- -------- -------- -------- -------- --------
Total from investment operations .............. 1.87 2.67 1.11 1.81 2.58 1.05
-------- -------- -------- -------- -------- --------
Less Distributions:
Dividends (from net investment income) ........ 0.00 0.00 (0.01) 0.00 0.00 0.00
Distributions (from realized capital gains) ... 0.00 (0.84) (0.27) 0.00 (0.84) (0.27)
Distributions (in excess of realized gains) ... 0.00 (0.10) (0.01) 0.00 (0.10) (0.01)
-------- -------- -------- -------- -------- --------
Total distributions ........................... 0.00 (0.94) (0.29) 0.00 (0.94) (0.28)
-------- -------- -------- -------- -------- --------
Net asset value, end of period ................. $ 14.56 $ 12.69 $ 10.96 $ 14.36 $ 12.55 $ 10.91
======== ======== ======== ======== ======== ========
Total return(5) ................................ 14.74% 24.35% 10.89% 14.42% 23.64% 10.34%
Ratios/Supplemental Data:
Net assets, end of period (000's) ............. $ 38,879 $ 29,468 $ 13,552 $ 6,219 $ 5,691 $ 2,210
Ratio of expenses to average
net assets (annualized)(7) ................... 1.53% 1.62% 1.51% 2.04% 2.14% 2.24%
Ratio of net investment income to average
net assets (annualized) ....................... 0.57% 0.14% 0.13% 0.04% (0.40)% (0.75)%
Portfolio turnover rate (Note 5) .............. 34.71% 63.62% 64.89% 34.71% 63.62% 64.89%
Average commission rate paid(6) ............... $ 0.0232 $ 0.0029 $ 0.0052 $ 0.0232 $ 0.0029 $ 0.0052
<FN>
(1) For the six months ended June 30, 1998 (unaudited).
(2) For the year ended December 31.
(3) For the period April 30, 1996 (effective date of registration) to December
31, 1996.
(4) For the period April 30, 1997 (inception of operations) to December 31,
1997.
(5) Total returns assume purchase at net asset value (without sales charge) at
the beginning of each period. Returns for periods less than a full year are
aggregate (non-annualized) returns.
(6) Initiating with fiscal year 1996, the Funds are required to disclose their
average commission rate per share for purchases and sales of equity
securities.
(7) Effective January 10, 1990, the Distributor and Adviser for the Atlas Funds
agreed to temporarily cap (or waive) their management and 12b-1 fees and to
absorb other operating expenses. Had such action not been taken, the ratio
of expenses to average net assets (annualized) would have been as follows:
</FN>
</TABLE>
<TABLE>
<CAPTION>
Class A Class B
Period Ended 1998(1) 1997 1996 1995 1994 1993 1998(1) 1997 1996 1995 1994
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Global Growth Fund ......... 1.53% 1.66% 2.36% NA NA NA 2.22% 2.48% 3.25% NA NA
Emerging Growth Fund ...... 1.63% 1.88% NA NA NA NA 2.62% 3.25% NA NA NA
<FN>
50 The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
<PAGE>
- ---------------------------------------------------------------
Emerging Growth Fund
Class A Class B
- ---------------------------------------------------------------
1998(1) 1997(4) 1998(1) 1997(4)
$ 13.00 $ 10.00 $ 12.93 $ 10.00
- -------- -------- -------- --------
(0.05) (0.05) (0.09) (0.12)
1.16 3.05 1.15 3.05
- -------- -------- -------- --------
1.11 3.00 1.06 2.93
- -------- -------- -------- --------
0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00
- -------- -------- -------- --------
0.00 0.00 0.00 0.00
- -------- -------- -------- --------
$ 14.11 $ 13.00 $ 13.99 $ 12.93
======== ======== ======== ========
8.54% 30.00% 8.20% 29.30%
$ 17,796 $ 10,028 $ 2,340 $ 2,235
1.49% 1.49% 2.11% 2.23%
(0.66)% (0.59)% (1.28)% (1.35)%
45.79% 17.06% 45.79% 17.06%
$ 0.0600 $ 0.0600 $ 0.0600 $ 0.0600
51
<PAGE>
Notes to Financial Statements June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
1. Significant Accounting Policies
Atlas Assets, Inc., a Maryland corporation (the "Company"), is an open-end
management investment company registered under the Investment Company Act of
1940 ("1940 Act"), as amended, and offering twelve portfolios. The Company
currently consists of the Atlas U.S. Treasury Money Fund, the Atlas California
Municipal Money Fund, the Atlas National Municipal Money Fund, the Atlas
California Municipal Bond Fund, the Atlas National Municipal Bond Fund, the
Atlas U.S. Government and Mortgage Securities Fund, the Atlas Strategic Income
Fund, the Atlas Balanced Fund, the Atlas Growth and Income Fund, the Atlas
Strategic Growth Fund, the Atlas Global Growth Fund, and the Atlas Emerging
Growth Fund (a "Fund", or collectively, the "Funds"). All Funds are diversified
with the exception of the Atlas California Municipal Money Fund and the Atlas
California Municipal Bond Fund which are non-diversified. The Funds offer two
classes of shares, Class A and Class B, with the exception of Atlas California
Municipal Money Fund and Atlas National Municipal Money Fund which offer only
Class A shares. Class A shares are offered at net asset value at the time of
purchase while all Class B shares may be subject to a contingent deferred sales
charge. Both share classes have equal rights and privileges but have separate
distribution plans, class specific expenses and exclusive rights to vote on
matters affecting only individual classes. Class B shares will automatically
convert to Class A shares sixty months after purchase.
The investment objective of the Money and Bond Funds is to seek a high
level of current income consistent with prudent investment management. The Money
Funds seek short-term yields with liquidity and stability of principal. The Bond
Funds seek higher long-term yields for investors who can accept price
fluctuations. The Stock Funds seek a varying mix of long-term capital growth and
current income for investors who can accept price fluctuations.
The following is a summary of significant accounting policies consistently
followed by the Funds in the preparation of their financial statements. The
policies are in conformity with generally accepted accounting principles for
investment companies.
a. Investment Valuation: Bond Fund securities are valued by pricing
services. Valuations of portfolio securities furnished by the pricing
services are based upon a computerized matrix system and/or appraisals,
in each case, in reliance upon information concerning market
transactions and quotations from recognized securities dealers.
Securities for which quotations are readily available are valued based
upon those quotations. Securities for which quotations are not readily
available (which constitute the majority of the Bond Funds' securities)
are valued at their fair value based upon the information supplied by
the pricing services. The methods used by the pricing services and the
quality of valuations so established are reviewed by the Company's
officers under the general supervision of the Directors of the Company.
There are a number of pricing services available and the Directors, on
the basis of ongoing evaluation of these services, may use other
pricing services or discontinue the use of any pricing service in whole
or in part.
Money Fund securities have a remaining maturity of 13 months or less
and their entire portfolios have a weighted average maturity of 90 days
or less. As such, all of the Money Fund securities are valued at
amortized cost, which approximates value. If a Money Fund portfolio had
a remaining weighted average maturity of greater than 90 days, the
portfolios would be stated at value based on recorded closing sales on
a national securities exchange or, in the absence of a recorded sale,
at the mean between the bid and asked prices.
Stock Fund securities listed or traded on an exchange are valued at the
last sales price on the exchange, or lacking any sales on a particular
day, the security is valued at the mean between the closing bid and
asked prices on that day. Each security traded in the over-the-counter
market (but not including securities reported on the NASDAQ National
Market System) is valued at the mean between the last bid and asked
prices. Each security reported on the NASDAQ National Market System is
valued at the last sales price on the valuation date.
b. Security Credit Risk: The Atlas Strategic Income Fund may invest any
amount of its assets in higher yielding, lower-rated debt securities,
including defaulted securities, which may be subject to a greater
degree of credit risk, greater market fluctuations and risk of loss of
income and principal than lower yielding, investment grade fixed income
securities. The Atlas Global Growth Fund and the Atlas Emerging Growth
Fund may also invest in such lower-rated securities, but only to a much
more limited extent. As of June 30, 1998, Atlas Strategic Income Fund
holds securities in default with an aggregate market value of $26,913,
representing less than 0.04% of the Fund's net assets.
52
<PAGE>
- --------------------------------------------------------------------------------
c. Municipal Bonds or Notes with "Puts": The Funds have purchased
municipal bonds or notes with the right to resell the bonds or notes to
the seller at an agreed upon price or yield on a specified date or
within a specified period (which will be prior to the maturity date of
the bonds or notes). Such a right to resell is commonly known as a
"put". In determining the weighted average maturity of the Money Funds'
portfolios, municipal bonds and notes as to which the Funds hold a put
will be deemed to mature on the last day on which the put may be
exercisable.
d. Variable Rate Demand Notes: The Funds have invested in certain variable
interest rate demand notes with maturities greater than 90 days but
which are redeemable at specified intervals upon demand. The maturity
of these instruments for purposes of calculating the portfolio's
weighted average maturity is considered to be the greater of the period
until the interest rate is adjusted or until the principal can be
recovered by demand.
e. Federal Income Taxes: It is the Company's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute all of its net investment
income, including any net realized gain on investments, to its
shareholders. Accordingly, no provision for federal income or excise
tax is required.
f. Security Transactions: As is common in the industry, security
transactions are accounted for on the date securities are purchased or
sold (trade date). Realized gains and losses on security transactions
are determined on the basis of specific identification for both
financial statement and federal income tax purposes.
g. Allocation of Expenses, Income and Gains and Losses: Common expenses
incurred by the Company are allocated among the Funds based on the
ratio of net assets of each Fund to the combined net assets. Common
expenses, income and gains and losses are allocated daily among share
classes of each Fund based on the relative proportion of net assets
represented by each class. Other expenses are charged to each Fund as
incurred on a specific identification basis and then allocated amongst
the share classes or charged to the share class to which the expense is
directly attributable.
h. Investment Income, Expenses and Distributions: Interest income and
estimated expenses are accrued daily. Interest on payment-in-kind debt
securities is accrued as income at the coupon rate and a market
adjustment is made periodically. Dividends are recorded on the
ex-dividend date. Dividends-in-kind are recorded as income on the
ex-dividend date at the current market value of the underlying
security. The Money Funds declare and reinvest dividends daily and pay
them monthly. The Bond Funds declare dividends daily and reinvest and
pay them monthly. The Stock Funds, with the exception of the Atlas
Strategic Growth Fund, the Atlas Global Growth Fund and the Atlas
Emerging Growth Fund, which are on an annual schedule, declare, pay and
reinvest dividends quarterly. Income for the Atlas Balanced Fund, the
Atlas Growth and Income Fund and the Atlas Global Growth Fund for the
period ended June 30, 1998 are net of foreign withholding taxes of
$3,712, $394 and $34,343, respectively. Distributions of capital gains,
if any, will normally be declared and paid once a year.
i. To-Be-Announced Securities: The Atlas U.S. Government and Mortgage
Securities Fund and the Atlas Strategic Income Fund may trade portfolio
securities on a "to-be-announced" (TBA) basis. In a TBA transaction,
the Fund has committed to purchasing or selling securities for which
all specific information is not yet known at the time of the trade,
particularly the pool number and face amount. Securities purchased on a
TBA basis are not settled until they are delivered to the Fund,
normally 15 to 45 days later. These transactions are subject to market
fluctuations and their current value is determined in the same manner
as for other portfolio securities. Pursuant to regulation, the Fund
sets aside sufficient investment securities as collateral to meet these
commitments. TBA commitments as of June 30, 1998 were $28,185,111 for
Atlas Government and Mortgage Securities Fund and $4,555,517 for Atlas
Strategic Income Fund.
j. Options: Premiums received from call options written are recorded as a
liability. The amount of the liability is subsequently adjusted to
reflect the current market value of the option written. If the option
is not exercised, premiums received are realized as a gain at
expiration date. If the position is closed prior to expiration, a gain
or loss is realized based on premiums received less the cost of the
closing transaction. When an option is exercised, premiums received are
added to the proceeds from the sale of the underlying securities and a
gain or loss is realized accordingly. These same principles apply to
the sale of put options.
53
<PAGE>
Notes to Financial Statements June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
k. Forward Contracts: The Stock Funds and Atlas Strategic Income Fund may
enter into forward foreign currency exchange contracts (forward
contracts) to hedge specific transactions or portfolio positions and to
protect the value of the portfolio against future changes in currency
exchange rates. A forward contract is an obligation to purchase or sell
a specific currency at an agreed upon future date at a price set on the
day of the contract.
The valuation of forward contracts, which may be owned by the Stock
funds and Atlas Strategic Income Fund, is based on the daily closing
prices of the forward currency contract rates in the London foreign
exchange markets as provided by pricing services. Gains or losses are
realized upon the closing or settlement of the forward transaction.
Securities are held in segregated accounts to cover net exposure on
outstanding forward contracts. Unrealized appreciation or depreciation
on forward contracts is reported in the Statement of Assets and
Liabilities. Realized gains and losses are reported with all other
foreign currency gains and losses in the Fund's Statement of
Operations. The risks associated with forward contracts include the
potential default of the other party to the contract and unanticipated
movements in the value of a foreign currency relative to the U.S.
dollar.
l. Repurchase Agreements: The Funds may invest in repurchase agreements
secured by U.S. Government obligations or by other securities.
Securities pledged as collateral for repurchase agreements are held by
the Funds' custodian bank until maturity of the repurchase agreements.
Provisions of the agreements ensure that the market value of the
collateral is sufficient in the event of default; however, in the event
of default or bankruptcy by the other party to the agreements,
realization and/or retention of the collateral may be subject to legal
proceedings.
m. Dollar Roll Transactions: The Atlas U.S. Government and Mortgage
Securities Fund and the Atlas Strategic Income Fund may engage in
dollar reverse repurchase agreements ("dollar rolls"), which entail the
simultaneous sale of securities with an agreement to buy back
substantially similar securities at a future date at a price less than
the price at which the securities were originally sold. These
transactions are accounted for as financing transactions as opposed to
sales and purchases. The differential in price between the sale price
and repurchase price is recorded as deferred income and recognized
between the settlement dates of the sale and repurchase. Pursuant to
regulation, the funds set aside sufficient investment securities as
collateral to meet these commitments. Dollar roll transactions involve
risk that the market value of the securities sold by the Funds may
decline below the repurchase price of those securities.
n. Foreign Currency Translation: Amounts denominated in or expected to
settle in foreign currencies (FC) are translated into United States
dollars at rates reported by selected pricing services on the following
basis: Market value of investment, other assets and liabilities -- at
the closing rate of exchange at the balance sheet date; purchases and
sales of investment securities, income and expenses -- at the rate of
exchange prevailing on the respective dates such transactions are
recorded.
The Funds do not isolate that portion of the results of operations
resulting from changes in foreign exchange rates on investments from
the fluctuations arising from changes in market prices of securities
held. Such fluctuations are included with the net realized and
unrealized gain or loss from investments.
Net realized foreign exchange gains or losses arise from sales and
maturities of short-term securities, sales of FC's, currency gains or
losses realized between the trade and settlement dates on securities
transactions, the difference between the amounts of dividends, interest
and foreign withholding taxes recorded on the Funds' books, and the
U.S. dollar equivalent of the amounts actually received or paid. Net
unrealized foreign exchange gains and losses arise from changes in the
value of assets and liabilities other than investments in securities at
fiscal year end, resulting from changes in the exchange rates.
o. The Funds have previously adopted Statement of Position 93-2,
"Determination, Disclosure, and Financial Statement Presentation of
Income, Capital Gain, and Return of Capital Distributions by Investment
Companies." In accordance with the statement, distributions in excess
of realized gains have been reflected in the Statements of Changes in
Net Assets as follows: Atlas Strategic Income Fund -- $39,952 in 1997
resulting from the non-deductibility under Internal Revenue Service
regulations of certain wash sales and $24,754 resulting from
54
<PAGE>
- --------------------------------------------------------------------------------
a difference in the required distribution amount determined under
excise tax rules versus that determined under generally accepted
accounting principles; Atlas Growth and Income Fund -- $47,198 in 1997
resulting from the non-deductibility under Internal Revenue Service
regulations of certain wash sales; and Atlas Global Growth Fund --
$2,513 in 1997 resulting from the non-deductibility under Internal
Revenue Service regulations of certain wash sales and $201,451 in 1997
resulting from a difference in the required distribution amount
determined under excise tax rules versus that determined under
generally accepted accounting principles.
p. Use of Estimates: The preparation of financial statements in conformity
with generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of
assets and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
2. Unamortized Organization Costs
Organization costs of $35,906 incurred by the Company as of June 30, 1994
in the organization of the Class B Plan have been allocated equally to the Funds
existing at that date offering Class B shares. These costs have been deferred
and are being amortized on a straight line basis over a period of five years
from July 1994.
3. Unrealized Appreciation/Depreciation -- Tax Basis
<TABLE>
As of June 30, 1998, each Fund had the following unrealized appreciation
(depreciation) for federal income tax purposes (in 000's):
<CAPTION>
California National California National U.S. Government
U.S. Treasury Municipal Municipal Municipal Municipal and Mortgage
Money Fund Money Fund Money Fund Bond Fund Bond Fund Securities Fund
----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Unrealized appreciation ................ $ 0 $ 0 $ 0 $ 13,653 $ 4,035 $ 4,372
Unrealized depreciation ................ $ 0 $ 0 $ 0 $ (34) $ (16) $ (82)
----------------------------------------------------------------------------------------
Net unrealized appreciation ............ $ 0 $ 0 $ 0 $ 13,619 $ 4,019 $ 4,290
========================================================================================
Cost of securities for federal
income tax purposes .................... $ 57,140 $ 43,357 $ 5,402 $ 194,302 $ 58,202 $ 232,365
========================================================================================
Strategic Balanced Growth and Strategic Global Growth Emerging
Income Fund Fund Income Fund Growth Fund Fund Growth Fund
------------------------------------------------------------------------------------
Unrealized appreciation ................. $ 1,503 $ 13,984 $ 54,190 $ 14,389 $ 9,743 $ 2,952
Unrealized depreciation ................. $ (1,292) $ (764) $ (3,533) $ (1,313) $ (2,834) $ (850)
------------------------------------------------------------------------------------
Net unrealized appreciation ............. $ 211 $ 13,220 $ 50,657 $ 13,076 $ 6,909 $ 2,102
====================================================================================
Cost of securities for federal
income tax purposes ..................... $ 73,315 $ 71,734 $ 186,645 $ 78,797 $ 38,775 $ 18,371
====================================================================================
55
</TABLE>
<PAGE>
Notes to Financial Statements June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
4. Share Transactions
<TABLE>
The following is a summary of share transactions for the periods ended June
30, 1998 and December 31, 1997 (in 000's):
<CAPTION>
U.S. Treasury California Municipal National Municipal
Money Fund Money Fund Money Fund
Class A Class B Class A Class A
1998 1997 1998 1997 1998 1997 1998 1997
------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Sold ................................... 24,391 68,098 174 516 16,759 35,350 1,297 4,628
Issued in reinvestment of
dividends .............................. 1,283 2,850 4 5 593 1,301 81 195
Redeemed ............................... (28,819) (76,384) (140) (477) (20,473) (29,255) (2,548) (5,758)
------------------------------------------------------------------------------------
Net increase (decrease) ................ (3,145) (5,436) 38 44 (3,121) 7,396 (1,170) (935)
====================================================================================
California Municipal National Municipal
Bond Fund Bond Fund
Class A Class B Class A Class B
1998 1997 1998 1997 1998 1997 1998 1997
------------------------------------------------------------------------------------
Sold ................................... 1,596 1,246 14 212 367 276 8 88
Issued in reinvestment of
dividends ............................. 270 569 10 20 89 185 5 9
Issued in connection with a
reorganization (Note 7) ................ N/A 1,480 N/A 51 N/A 851 N/A 22
Redeemed ............................... (1,222) (2,155) (25) (62) (362) (647) (13) (19)
====================================================================================
Net increase (decrease) ................ 644 1,140 (1) 221 94 665 0 100
====================================================================================
U.S. Government and Mortgage
Securities Fund
Class A Class B
1998 1997 1998 1997
-------------------------------------------
Sold ................................... 1,742 1,295 12 173
Issued in reinvestment of
dividends ............................. 394 861 14 26
Issued in connection with a
reorganization (Note 7) ................ N/A 342 N/A 31
Redeemed ............................... (2,179) (4,897) (57) (106)
===========================================
Net increase (decrease) ................ (43) (2,399) (31) 124
===========================================
Strategic Income Fund Balanced Fund
Class A Class B Class A Class B
1998 1997 1998 1997 1998 1997 1998 1997
------------------------------------------------------------------------------------
Sold ................................... 5,750 5,282 49 1,057 1,746 1,293 18 299
Issued in reinvestment of
dividends .............................. 198 271 28 58 65 169 8 29
Redeemed ............................... (1,261) (1,680) (103) (128) (304) (368) (20) (45)
------------------------------------------------------------------------------------
Net increase (decrease) ................ 4,687 3,873 (26) 987 1,507 1,094 6 283
====================================================================================
Growth and Income Fund
Class A Class B
1998 1997 1998 1997
-------------------------------------------
Sold ................................... 1,455 1,523 23 185
Issued in reinvestment of
dividends ............................. 38 1,468 2 151
Redeemed ............................... (685) (1,554) (56) (65)
-------------------------------------------
Net increase (decrease) ................ 808 1,437 (31) 271
===========================================
Strategic Growth Fund Global Growth Fund
Class A Class B Class A Class B
1998 1997 1998 1997 1998 1997 1998 1997
------------------------------------------------------------------------------------
Sold ................................... 1,133 1,732 25 329 539 1,291 7 238
Issued in reinvestment of
dividends .............................. 0 263 0 58 0 159 0 31
Redeemed ............................... (253) (264) (41) (35) (191) (364) (27) (18)
------------------------------------------------------------------------------------
Net increase (decrease) ................ 880 1,731 (16) 352 348 1,086 (20) 251
====================================================================================
Emerging Growth Fund
Class A Class B
1998 1997(1) 1998 1997(1)
-------------------------------------------
Sold ................................... 577 816 7 182
Issued in reinvestment of
dividends ............................. 0 0 0 0
Redeemed ............................... (87) (44) (44) (9)
-------------------------------------------
Net increase (decrease) ................ 490 772 (6) 173
===========================================
<FN>
(1)For the period April 30, 1997 (inception of operations) to December 31,
1997.
</FN>
</TABLE>
56
<PAGE>
- --------------------------------------------------------------------------------
5. Purchases and Sales of Securities
<TABLE>
Aggregate purchases and sales of securities (excluding short-term
securities) for the period ended June 30, 1998 were as follows (in 000's):
<CAPTION>
California National California National U.S. Government
U.S. Treasury Municipal Municipal Municipal Municipal and Mortgage
Money Fund Money Fund Money Fund Bond Fund Bond Fund Securities Fund
------------- ---------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Purchases ........ $ 0 $ 0 $ 0 $ 30,836 $ 12,373 $ 30,792
Sales ............ $ 0 $ 0 $ 0 $ 22,509 $ 10,847 $ 35,552
------------- ---------- ------------- ------------- ------------- -------------
Strategic Balanced Growth and Strategic Global Emerging
Income Fund Fund Income Fund Growth Fund Growth Fund Growth Fund
------------- ---------- ------------- ------------- ------------- -------------
Purchases ........ $ 99,121 $ 13,813 $ 95,558 $ 38,011 $ 20,656 $ 11,851
Sales ............ $ 77,741 $ 3,848 $ 78,391 $ 27,906 $ 13,297 $ 6,405
------------- ---------- ------------- ------------- ------------- -------------
</TABLE>
<TABLE>
At June 30, 1998 the following Funds had capital loss carryovers
approximating these amounts for federal income tax purposes (in 000's):
<CAPTION>
Expiring December 31,
-----------------------------------------------------
2001 2002 2003 2004 2005
<S> <C> <C> <C> <C> <C>
U.S. Treasury Money Fund ........................... $ - $ - $ - $ 10 $ 5
National Municipal Bond Fund ..................... $ - $ 2 $ -- $ - $ -
U.S. Government and Mortgage Securities Fund ...... $ 487 $ 5,195 $ 7,507 $ 1,491 $ 280
Emerging Growth Fund .............................. $ - $ - $ - $ - $ 28
</TABLE>
Such amounts may be used to offset capital gains realized during the
subsequent periods indicated and thereby relieve these funds and their
shareholders of federal tax liability with respect to the capital gains that are
so offset. It is the intention of the Funds not to make distributions from
capital gains while they have a capital loss carryover.
6. Transactions With Affiliates and Related Parties
Atlas Advisers, Inc. (the "Adviser") provides portfolio management services
to the U.S. Government and Mortgage Securities Fund and the U.S. Treasury Money
Fund and supervises the provision of similar services to the Atlas Municipal
Funds by Boston Safe Advisers, Inc. and to the Atlas Stock Funds and Atlas
Strategic Income Fund by OppenheimerFunds, Inc. (together, the "Subadvisers").
Each Fund pays the Adviser a management fee for the investment management
services who, in turn, pays the Subadvisers. The management fee is based on an
annual rate, equal to a percentage of each Fund's average daily net assets, and
is paid monthly as follows: .50% of assets up to $500 million and .475% of
assets over $500 million for the Money Funds; .55% of assets up to $500 million
and .50% of assets over $500 million for the Bond Funds other than Atlas
Strategic Income Fund; .70% of assets up to $100 million, .60% of assets of the
next $400 million and .50% of assets over $500 million for the Stock Funds other
than Atlas Global Growth Fund and Atlas Emerging Growth Fund; .75% of assets up
to $100 million, .70% of assets of the next $400 million and .65% of assets over
$500 million for the Atlas Strategic Income Fund; and .80% of assets up to $100
million, .75% of assets of the next $400 million and .70% of assets over $500
million for the Atlas Global Growth Fund and the Atlas Emerging Growth Fund.
Atlas Securities, Inc. (the "Distributor") acts as principal underwriter
for all classes of shares of each Fund pursuant to a Principal Underwriting
Agreement which provides for a commission to be paid on the redemption of Class
B shares held less than five years of the Stock and Bond Funds and the U.S.
Treasury Money Fund. The Distributor also receives payments under separate
Distribution Plans (the "Class A Plan" and "Class B Plan") pursuant to Rule
12b-1 of the 1940 Act. Under the Class A Plan, the Company may reimburse the
Distributor up to a maximum of .25% per year of average daily Class A net assets
in each Fund, payable on a quarterly basis. Under the Class B Plan, the maximum
rate is .75% per year of average daily Class B net assets in each Fund and is
payable on a monthly basis.
Due to voluntary expense waivers in effect during the period ended June 30,
1998, 12b-1 fees relating to Class A shares were assessed and paid to the
Distributor at rates, varying by Fund, ranging from 0.00% to .25% per annum.
Such fees
57
<PAGE>
Notes to Financial Statements June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
under the Class B Plan were assessed and paid at a rate of .75% per annum. Class
A 12b-1 fees due the Distributor were reduced in the amount of $208,233.
Management fees due the Adviser were reduced by $231,850. The Adviser also
absorbed $61,317 of other Fund expenses during the period. During the period
ended June 30, 1998, the Distributor received $51,226 for contingent deferred
sales charges paid by sellers of Class B shares. Such sales charges are not an
expense of the Funds and thus are not reflected in the accompanying Statements
of Operations.
The Adviser and Distributor are wholly owned subsidiaries of Golden West
Financial Corporation. Certain officers and directors of the Company are also
officers and/or directors of the Adviser and the Distributor.
At June 30, 1998, Golden West Financial Corporation owned 80,862 Class A
shares in the California Municipal Bond Fund, 45,162 shares in the National
Municipal Bond Fund and 116,324 shares in the Emerging Growth Fund.
7. Reorganizations
<TABLE>
On December 5, 1997, California Municipal Bond Fund, National Municipal
Bond Fund and U.S. Government and Mortgage Securities Fund acquired all of the
assets of California Insured Intermediate Municipal Fund, National Insured
Intermediate Municipal Fund and U.S. Government Intermediate Fund, respectively,
pursuant to separate Agreements and Plans of Reorganization approved by the
shareholders of each acquired fund on November 24, 1997. Information relative to
the transfer of assets and exchange of shares is summarized below. The net
assets of California Insured Intermediate Fund, National Insured Intermediate
Fund and U.S. Government Intermediate Fund included net unrealized appreciation
(depreciation) of $403,011, $221,521 and $(13,671), respectively. The
transactions qualified as tax-free reorganizations for federal income tax
purposes.
<CAPTION>
Combined
Share Shares Value of Net Assets on
Merged Fund/Surviving Fund Class Issued Issued Shares December 5, 1997
- ------------------------------------------------------ ------- ----------- --------------- -----------------
<S> <C> <C> <C> <C>
California Insured Intermediate Municipal Fund/
California Municipal Bond Fund ..................... A 1,480,175 $ 16,888,793 $ 194,353,610
B 50,846 $ 580,661 $ 7,802,691
National Insured Intermediate Municipal Fund/
National Municipal Bond Fund ........................ A 850,763 $ 9,809,295 $ 58,188,472
B 21,768 $ 250,984 $ 3,134,813
U.S. Government Intermediate Fund/
U.S. Government and Mortgage Securities Fund ...... A 342,216 $ 3,487,178 $ 203,355,324
B 31,035 $ 316,243 $ 7,195,556
</TABLE>
8. Concentrations of Credit Risk
There are certain concentrations of credit risk, which may subject the
Funds more significantly to economic changes occurring in certain industries or
sectors as follows:
The California Municipal Money Fund and the California Municipal Bond Fund
have concentrations in California municipal securities.
The U.S. Government and Mortgage Securities Fund has a concentration in
Federal Home Loan Mortgage Corporation and Federal National Mortgage Association
securities.
The U.S. Treasury Money Fund has a concentration in United States Treasury
obligations.
Industry and sector concentrations greater than 10% of a Fund's net assets
at June 30, 1998 are as follows:
The California Municipal Money Fund has 15.09% in housing, 12.90% in
industrial development, 11.05% in airport/seaport and 10.33% in public power.
The National Municipal Money Fund has 21.00% in health, 16.64% in
industrial development and 10.00% in general obligation bonds.
58 The accompanying notes are an integral part of these financial statements.
<PAGE>
- --------------------------------------------------------------------------------
The California Municipal Bond Fund has 18.53% in water/sewer, 11.50% in
general obligation bonds, 10.92% in public power and 10.73% in airport/seaport.
The National Municipal Bond Fund has 20.02% in general obligation bonds,
14.20% in public power, 12.34% in education and 11.00% in health.
The Balanced Fund and Global Growth Fund have 15.93% and 15.92%,
respectively, in banks.
The Emerging Growth Fund has 20.02% in computer software and 10.52% in
telecommunications.
9. Forward Contracts
<TABLE>
Open forward contracts in the Funds to purchase and sell foreign currencies
as of June 30, 1998 were as follows:
<CAPTION>
Contract
Settlement Amount Valuation as Unrealized
Date (000's) of 6/30/98 Gain (Loss)
-------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Strategic Income Fund:
- ------------------------------
Contracts to Buy:
- ------------------------------
Australian Dollar ............ 07/20/98-07/22/98 550 AUD $ 341,471 $ (976)
British Pound Sterling ...... 07/01/98-07/06/98 891 GBP 1,486,435 8,574
European Currency Unit ...... 07/15/98 167 ECU 183,293 2,688
German Deutsche Mark ......... 06/29/98-07/15/98 2,157 DEM 1,195,188 (18,119)
Japanese Yen. ............... 07/10/98-07/31/98 58,270 JPY 422,904 15,058
Malaysian Ringgit ............ 08/28/98-09/21/98 584 MYR 137,166 (7,406)
New Zealand Dollar ......... 07/01/98-07/22/98 370 NZD 192,131 (2,101)
Philippine Peso ............ 07/10/98 3,031 PHP 72,804 (146)
Polish Zloty ............... 06/17/98 24 PLZ 6,883 353
------------ ---------
$ 4,038,275 (2,075)
============ ---------
Contracts to Sell:
- ------------------------------
Australian Dollar ............ 07/20/98-07/22/98 405 AUD $ 251,501 843
British Pound Sterling ...... 07/01/98-07/06/98 898 GBP 1,498,981 (8,751)
European Currency Unit ...... 07/15/98 167 ECU 183,293 (1,213)
German Deutsche Mark ......... 07/06/98-07/15/98 1,728 DEM 957,480 8,766
Greek Drachma ............... 07/17/98-07/20/98 35,000 GRD 114,620 (1,835)
Japanese Yen ............... 07/10/98-07/31/98 84,210 JPY 611,300 6,116
Malaysian Ringgit ............ 08/28/98-09/21/98 584 MYR 137,166 15,138
New Zealand Dollar ......... 07/01/98-07/22/98 1,020 NZD 529,970 2,325
Philippine Peso ............ 07/10/98 3,031 PHP 72,804 2,037
South African Rand ......... 07/06/98 1,202 ZAR 201,188 28,163
------------ ---------
$ 4,558,303 51,589
============ ---------
Net unrealized gain ......... $ 49,514
=========
Global Growth Fund:
- ------------------------------
Contracts to Buy:
- ------------------------------
French Franc ............... 7/31/98 1,002 FRF $ 165,906 $ 199
Japanese Yen ............... 06/29/98 790 JPY 5,718 (430)
Portuguese Escudo ............ 07/01/98 16,577 PTE 89,716 (182)
Singapore Dollar ............ 06/29/98 73 SGD 43,391 (788)
------------ ---------
$ 304,731 (1,201)
============ ---------
Contracts to Sell:
- ------------------------------
French Franc ............... 06/30/98 3,391 FRF $ 560,365 3,931
Swiss Franc .................. 07/06/98 1,429 CHF 943,066 56,934
------------ ---------
$ 1,503,431 60,865
============ ---------
Net unrealized gain ......... $ 59,664
=========
59
</TABLE>
<PAGE>
Notes to Financial Statements June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
10. Futures Contracts
The Bond and Stock Funds may purchase and sell futures contracts for
hedging their investments against changes in value, to manage cash flow, to
attempt to enhance income, or as a temporary substitute for purchases or sales
of actual securities. These Funds may also buy or write put or call options on
these futures contracts.
The purpose of the acquisition or sale of a futures contract is to protect
the involved Fund from adverse fluctuations in interest rates or in market or
currency indices and the resulting negative valuation effect on the Fund
investments without actually buying or selling securities.
Upon engaging in a futures contract, the Fund is required to deposit with
the broker an amount of cash or cash equivalents equal to a certain percentage
of the contract amount (initial margin). Subsequent payments (variation margins)
to and from the Fund or the broker, must be made daily as the price of the
security or the currency rate underlying the futures contract fluctuates, making
the long or short position in the futures contract more or less valuable. The
Fund recognizes a realized gain or loss when the contract is closed or expires.
Securities held in collateralized accounts to cover initial margin
requirements on open futures contracts are noted in the Statements of
Investments. The Statements of Assets and Liabilities reflects a receivable or
payable for the daily mark to market variation margin.
Futures contracts (and related options) involve risks to which the Bond and
Stock Funds would otherwise not be subject. Inherent risks include the
possibility of imperfect correlation between the price of the futures contract
or option and the price of the securities or indices being hedged and the
possible absence of a liquid secondary market for any particular instrument at
any time.
<TABLE>
As of June 30, 1998, the Atlas Strategic Income Fund had outstanding
futures contracts to purchase debt securities as follows:
<CAPTION>
Number of Unrealized
Expiration Futures Appreciation/
Contracts to Purchase: Date Contracts Valuation (Depreciation)
- -------------------------------- -------------------------------------------------------------
<S> <C> <C> <C> <C>
U.S. Treasury Bonds ......... 09/98 27 $ 3,337,031 $ 49,312
German Government Bonds ...... 09/98 1 $ 150,091 (71)
--------
$ 49,241
========
</TABLE>
11. Options Transactions
The Bond and Stock Funds may purchase and sell covered exchange listed put
and call options on securities, indices and currencies. These options my be on
debt securities, financial indices and foreign currencies (Bond Funds) and on
stocks, stock and financial indices, foreign government securities or foreign
currencies (Stock Funds).
A Fund may sell covered put options and call options for additional premium
income, buy put options in an effort to protect the value of a security in its
portfolio against decline in value and buy call options in an effort to protect
against a price increase of securities or currencies it intends to purchase. The
Bond and Stock Funds may also make offsetting transactions to close open
positions.
A Fund may write a put option as an alternative to purchasing a security. A
put option gives the holder the right to sell the underlying security to the
Fund at any time during the option period at a predetermined exercise price.
Writing a call option obligates the Fund to sell or deliver the option's
underlying security, in return for the strike price, upon exercise of the
option.
Premiums received are recorded as a liability which is marked to the market
daily to reflect the current value of the options. A Fund will realize a gain or
loss upon the expiration or closing of the option transaction. When an option is
exercised, the proceeds on sales for a written call option, the purchase cost
for a written put option, or the cost of the security for a purchased put or
call option is adjusted by the amount of the premium received or paid. If an
option expires or is canceled in a closing transaction, the Fund will realize a
gain or loss depending on whether the cost of the closing transaction, if any,
is lesser than or greater than the premium originally received.
60
<PAGE>
- --------------------------------------------------------------------------------
Securities designated to cover outstanding call options are noted in the
Statements of Investments where applicable. Shares subject to call, expiration
date, exercise price, premium received and market value are detailed in a
footnote to the Statements of Investments. Options written are reported as a
liability in the Statements of Assets and Liabilities. Gains and losses are
reported in the Statements of Operations. The risk in writing a call option is
that the Fund foregoes the opportunity for profit if the value of the underlying
security increases and the option is exercised.
The risk in writing a put option is that the Fund is exposed to a potential
loss if the value of the underlying security declines and the option is
exercised. Owning an option exposes the Fund to the risk of paying a premium
whether the option is exercised or not. Additional risk exists if an illiquid
secondary market does not allow for entering into a closing transaction.
<TABLE>
Written option transactions in the Funds for the period ended June 30, 1998
were as follows:
<CAPTION>
Call Options Put Options
-------------------------- -------------------------------
Number of Amount of Number of Amount of
Options Premiums Options Premiums
-----------------------------------------------------------
<S> <C> <C> <C> <C>
Strategic Income Fund:
- -----------------------------------------------
Options outstanding at December 31, 1997 ...... 0 $ 0 54,409,500 $ 7,319
Options written .............................. 776,500 6,119 136,031,600 32,502
Options closed or expired ..................... (776,500) (6,119) (190,190,500) (32,221)
Options exercised ........................... 0 0 0 0
--------- -------- ------------- ---------
Options outstanding at June 30, 1998 ......... 0 $ 0 250,600 $ 7,600
========= ======== ============= =========
</TABLE>
12. Illiquid and Restricted Securities
The Funds may invest in securities that are illiquid or restricted. These
securities are not registered under the Securities Act of 1933, may be acquired
in private placements that may have legal or contractual restrictions preventing
their ready disposition, or may be repurchase agreements or time deposits
maturing in more than seven days. No Fund will invest in illiquid or restricted
assets if, immediately after such purchase, the value thereof, as determined
under methods approved by the Board of Directors, would exceed 10% of its net
assets. At June 30, 1998, the value of these securities and the resulting
percentage of net assets amounted to $15,048,388 or 7.21% in the Atlas U.S.
Government and Mortgage Securities Fund and $2,275,380 or 3.27% in the Atlas
Strategic Income Fund. Certain Funds own restricted securities which have been
determined to be liquid. These securities are not included in the 10% limitation
mentioned above and are identified in the Statements of Investments.
61
<PAGE>
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63
