<PAGE>
[LOGO]
<PAGE>
EMERALD MONEY MARKETS FOR INSTITUTIONS
PRIME FUND
TREASURY FUND
TAX-EXEMPT FUND
Emerald Shares/Emerald Service Shares
Investment Portfolios Offered
by Emerald Funds
ANNUAL REPORT
NOVEMBER 30, 1995
[LOGO]
E M E R A L D
F U N D S
<PAGE>
This report is not authorized for distribution to prospective investors unless
preceded or accompanied by a current prospectus for one of the Emerald Funds
discussed within.
THE EMERALD FUNDS ARE NOT INSURED OR PROTECTED BY THE FDIC OR ANY OTHER
GOVERNMENT AGENCY, ARE NOT DEPOSITS OR OBLIGATIONS OF BARNETT BANK, ARE NOT
GUARANTEED BY THE BANK AND INVOLVE INVESTMENT RISK, INCLUDING THE POSSIBLE LOSS
OF PRINCIPAL.
Investments in the Prime, Treasury and Tax-Exempt Funds are neither insured nor
guaranteed by the U.S. Government, and yields will fluctuate. There can be no
assurance that the Funds will be able to maintain a stable net asset value of
$1.00 per share.
Barnett Banks Trust Company, N.A. serves as investment adviser to the Emerald
Funds, is paid a fee for its services and is unaffiliated with Emerald Asset
Management, Inc., the Funds' distributor.
The service contractors for the Emerald Funds may from time to time voluntarily
waive fees or reimburse Fund expenses, which temporarily increases the return to
investors. These fee waivers and reimbursements may be discontinued at any time,
which would reduce performance results.
The Emerald Funds prospectuses contain more complete information, including
charges and expenses. Please read the prospectus carefully before investing.
<PAGE>
ECONOMIC REPORT FROM THE INVESTMENT ADVISER
- --------------------------------------------------------------------------------
FED ENGINEERS "SOFT LANDING"
By raising short-term interest rates steadily throughout 1994 and into early
1995, the Federal Reserve Board was able to put the brakes on an economy that
had started to soar. Economic growth has slowed from a rate of 5.1% in the
fourth quarter of 1994 to an expected rate of about 2.5% for all of 1995 -- low
enough to keep inflation in check and just fast enough to keep corporate profits
growing. Despite the fact that this recovery is already longer than average, we
do not expect a recession in 1996. If the economy softens further, however, we
believe that the Fed would act quickly to cut short-term interest rates.
A FOUNDATION FOR CONTINUED GROWTH
While the Fed deserves a great deal of credit for prolonging the economic
expansion into its fifth year, there are other forces at work as well. The first
is the globalization of the economy. With the spread of capitalism comes new
markets. In addition, global competition has kept wages and prices at bay in the
U.S.
The second major force is the aging of the U.S. population. The first "baby
boomers" are about to turn 50, changing their spending patterns away from
consumption and more toward investment. Assets in savings accounts and mutual
funds are at record levels. This trend has been a positive force for the stock
and bond markets. And it has also been a major factor in holding interest rates
down -- as the cost of money responds like any other commodity to the forces of
supply and demand.
THE WORLD'S MOST EFFICIENT ECONOMY
A third factor is the boom in U.S. productivity, making ours the most efficient
economy in the world. Companies continue to restructure in response to foreign
competition. Employers continue to announce layoffs, which puts downward
pressure on wages and prices, particularly at the retail level. Meanwhile,
American innovation and technology are sought throughout the world -- which
helped fuel the surge in technology stocks in 1995. Although relatively slow,
U.S. economic growth still exceeds that of Japan and much of Europe.
As we enter 1996, presidential and congressional politics will also continue to
affect the economy and the financial markets. Although, as of this writing, the
President and Congress continue to battle over the budget, both sides agree at
least that a balanced budget in the near term is important. Investors will be
watching progress in Washington very closely. Generally speaking, meaningful
steps toward greater fiscal responsibility will be viewed favorably by the
financial markets.
PLEASE READ THE PORTFOLIO MANAGER INTERVIEWS TO
LEARN MORE ABOUT THE STRATEGIES USED TO MANAGE
EACH EMERALD FUND AND ITS PERFORMANCE DURING
THIS PERIOD. REMEMBER, INVESTMENT RETURNS AND
PRINCIPAL VALUE WILL VARY WITH MARKET
CONDITIONS. PAST PERFORMANCE IS NOT INDICATIVE
OF FUTURE RESULTS. ALTHOUGH THE PRIME, TREASURY
AND TAX-EXEMPT FUNDS SEEK TO MAINTAIN A STABLE
NET ASSET VALUE (NAV) OF $1.00 PER SHARE, THERE
IS NO ASSURANCE THAT THEY WILL BE ABLE TO DO SO.
1
<PAGE>
INVERVIEW (as of November 30, 1995)
- --------------------------------------------------------------------------------
EMERALD PRIME AND TREASURY FUNDS*
PHOTO Ms. Lunsford is responsible for more than $2 billion in
assets as portfolio manager for the Emerald Short-Term
Jacqueline R. Fixed Income Fund and Emerald Money Market Funds. Before
Lunsford, joining Barnett in 1988, she spent 9 years as a money
C.F.A. manager with the First Kentucky Trust Company in
PORTFOLIO MANAGER Louisville, Ky. Ms. Lunsford currently serves as
16 years of President of the Jacksonville Financial Analysts Society
investment and is a member of the Association for Investment
experience Management and Research and the Treasury Management
Association. She is a Chartered Financial Analyst and
holds a B.S. in Finance.
INVESTMENT GOAL
The Emerald Money Market Funds seek to provide a high
level of current income consistent with liquidity, the
preservation of capital and a stable net asset value.
Each Fund seeks its objective by investing in:
PRIME FUND
A broad range of U.S. Government, bank and corporate
short-term money- market obligations.
TREASURY FUND
Short-term U.S. Treasury securities and other government
obligations, which are guaranteed full faith and credit
by the U.S. Treasury, and repurchase agreements
collateralized by the same.
EMERALD TAX-EXEMPT FUND*
Joseph M. Fahey, Jr., C.F.A.
PORTFOLIO MANAGER
Rodney Square Management Corp.,
a subsidiary of Wilmington Trust Company
INVESTMENT SUB-ADVISER
INVESTMENT GOAL
The Emerald Tax-Exempt Fund seeks to provide a high level
of current income consistent with liquidity, the
preservation of capital and a stable net asset value. The
Fund seeks its objective by investing in short-term
municipal obligations.
Investors may be subject to certain state and local taxes
and the federal alternative minimum tax.
WHAT FACTORS AFFECTED THE PERFORMANCE OF THE FUNDS?
Two major factors affected performance during the past year: changes in the
direction of interest rates and supply and demand imbalances. In 1994, the
Federal Reserve Board boosted short-term rates six times to slow down a surging
economy, with the last increase in February 1995. Soon afterward, the economy
stabilized and then began to slow. In the spring of this year, economists began
to speculate that the Fed would need to lower short-term interest rates in order
to keep the economy moving at a moderate pace. This expectation drove down
longer-term rates, which are determined by market forces.
Although the Fed pushed short-term rates slightly lower in July and again in
December 1995, recent decreases have not been large enough to offset the
previous increases. As a result, yields on short-term
- ---------------
* Investments in the Emerald Prime, Treasury and Tax-Exempt Funds are neither
insured nor guaranteed by the U.S. Government, and yields will fluctuate.
Although these Funds seek to maintain a stable net asset value (NAV) of $1.00
per share, there is no assurance that they will be able to do so.
For 1995, the Emerald Treasury Fund qualified for exemption from the Florida
intangibles tax. Investors may want to consult with their tax adviser.
2
<PAGE>
EMERALD PRIME, TREASURY AND TAX-EXEMPT FUNDS (as of November 30, 1995)
- --------------------------------------------------------------------------------
investments are still higher than they were at the end of November 1994. Indeed,
as of November 30, 1995, the Prime and Treasury Funds were yielding
approximately .70 of a percentage point above their levels a year ago, and the
Tax-Exempt Fund was yielding approximately 1.3 percentage points more. The
performance of the Funds' Emerald Shares remains above industry averages as
tracked by Lipper Analytical Services. Emerald Shares of the Prime Fund returned
5.81%, the Treasury Fund returned 5.62%, and the Tax-Exempt Fund returned 3.61%,
for the 12 months ended November 30, 1995, compared to average returns of 5.73%,
5.52% and 3.57% for comparable funds in the respective Lipper categories.
Service Shares of the Prime Fund returned 5.49%, the Treasury Fund returned
5.25%, and the Tax-Exempt Fund returned 3.24%, for the 12 months ended November
30, 1995, compared to average returns of 5.73%, 5.52% and 3.57% for comparable
funds in the respective Lipper categories.*
We feel that our consistent performance is due to our active management style
and our ability to quickly adapt our strategies to changing economic and market
conditions.
WHAT STRATEGIES WERE EMPLOYED TO MAXIMIZE PERFORMANCE RESULTS?
As interest rates began to decline in the spring of 1995, we began to lengthen
the average maturities of the Funds by purchasing longer-term instruments.
However, the shortage of new issuance in the short-term market -- and the
resulting high prices of these securities -- has made it increasingly difficult
to pursue this strategy. As a result, the average maturities of the Prime,
Treasury and Tax-Exempt Funds will likely remain in their current ranges over
the next few months.
WHAT FACTORS COULD AFFECT THE FUNDS IN THE MONTHS AHEAD?
Since inflation seems to be under control and the economy continues to slowly
struggle forward, we feel that the most significant influence on the securities
markets is the balanced budget package. Will it be passed? In what form, and
when? Economists and investors throughout the world are watching this quite
closely. A long delay or a complete breakdown in negotiations could cause
interest rates to rise as investors lose confidence that a balanced budget might
become a reality. If a budget package is passed and interest rates fall, we feel
that there will be a more significant decline in yields in the short-term sector
than in the intermediate- and longer-term sectors, since the latter have already
fallen rapidly. If the budget package is delayed and interest rates rise, then
we would expect the opposite to occur: short-term yields would rise very little,
while intermediate-and longer-term rates could rise sharply. Therefore, yields
on money market funds would not be affected as much as the total returns on
intermediate- and long-term bond funds.
<TABLE>
<CAPTION>
7-DAY YIELDS AS OF 11/30/95**
EMERALD
EMERALD SERVICE
SHARES SHARES
<S> <C> <C>
Prime Fund 5.57% 5.23%
Treasury Fund 5.40% 5.05%
Tax-Exempt Fund 3.48% 3.13%
</TABLE>
- ---------------
* Returns are based on the total cumulative returns for the 12 months ended
November 30, 1995. For both classes of shares, the Prime Fund was ranked with
132 other institutional money market funds, the Treasury Fund with 82 other
institutional U.S. Treasury money market funds, and the Tax-Exempt fund with
67 other institutional tax-exempt money market funds. Past performance is not
predictive of future results.
** The service contractors are voluntarily waiving a portion of the expenses for
the Prime, Treasury and Tax-Exempt Funds. In addition, they are voluntarily
reimbursing a portion of the expenses for the Emerald and Emerald Service
Shares of the Treasury and Tax-Exempt Funds. If the service contractors had
not waived or reimbursed expenses, total returns and yields would have been
lower. Had these waivers and/or reimbursements not been in effect, the 7-day
yields would have been 5.36% and 5.02% for the Emerald and Emerald Service
Shares of the Treasury Fund, respectively. The 7-day yields would have been
3.47% and 2.95% for the Emerald and Emerald Service Shares of the Tax-Exempt
Fund, respectively. This voluntary waiver and reimbursement of expenses may
be modified or terminated at any time, which would reduce the performance.
3
<PAGE>
EMERALD PRIME FUND
- --------------------------------------------------------------------------------
Portfolio of Investments
November 30, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
S&P/MOODY'S PRINCIPAL AMORTIZED
RATING MATURITY AMOUNT COST
(UNAUDITED) RATE DATE (000) (NOTE 2)
------------ ---- -------- --------- --------------
<S> <C> <C> <C> <C> <C>
BANK NOTES -- 8.6%
Bank of America, Seattle First National Medium Term Note* .......... A1/P1 5.74% 12/29/95 $ 35,000 $ 35,000,000
Bank of New York (Delaware), Medium Term Note* ..................... A1/P1 5.88 10/25/96 38,000 38,000,000
Huntington National Bank-Floating Rate Bank Note* .................. A1/P1 5.82 12/1/95 35,000 35,000,000
Nations Bank Corp-Floating Rate Medium Term Note * ................. A1/P1 5.94 12/20/95 23,850 23,874,161
Nations Bank Texas-Floating Rate Medium Term Note * ................ A1/P1 5.87 12/1/95 25,000 25,000,000
--------------
TOTAL BANK NOTES (AMORTIZED COST $156,874,161)........................ 156,874,161
--------------
BANKERS ACCEPTANCES -- 1.4%
Fuji Bank, Ltd., Los Angeles Branch ................................ A1/P1 5.81 12/6/95 10,000 9,991,931
Fuji Bank, Ltd., Los Angeles Branch ................................ A1/P1 5.79 12/11/95 15,000 14,975,875
--------------
TOTAL BANKERS ACCEPTANCES (AMORTIZED COST $24,967,806)................ 24,967,806
--------------
YANKEE CERTIFICATES OF DEPOSIT -- 14.5%
Bank of Tokyo, Ltd., Portland, Oregon Branch ....................... A1/P1 5.95 12/29/95 25,000 25,000,000
Dai Ichi Kangyo Bank, Ltd., New York Branch ........................ A1/P1 5.83 12/20/95 35,000 34,999,722
Deutsche Bank, New York Branch ..................................... A1+/P1 6.05 7/25/96 35,000 35,000,000
Fuji Bank, Ltd., New York Branch ................................... A1/P1 5.96 12/7/95 55,000 55,000,631
Sanwa Bank, Ltd., New York Branch .................................. A1+/P1 5.94 12/7/95 12,000 12,000,138
Sanwa Bank, Ltd., New York Branch .................................. A1+/P1 5.92 12/11/95 25,000 25,000,069
Sumitomo Bank, Ltd., New York Branch ............................... A1/P1 5.87 12/11/95 30,000 30,000,166
Sumitomo Bank, Ltd., New York Branch ............................... A1/P1 5.82 12/13/95 20,000 20,000,066
Sumitomo Bank, Ltd., New York Branch ............................... A1/P1 5.86 12/27/95 25,000 25,000,180
--------------
TOTAL YANKEE CERTIFICATES OF DEPOSIT (AMORTIZED COST $262,000,972).... 262,000,972
--------------
COMMERCIAL PAPER -- 21.8%
DOMESTIC -- 15.7%
Alpine Securitization .............................................. A1+/P1 5.78 12/19/95 71,133 70,927,426
Bankers Trust-Floating Rate * ...................................... A1/P1 5.89 12/1/95 25,000 25,000,000
Bear Stearns ....................................................... A1/P1 5.72 12/22/95 20,000 19,933,267
Bridgestone/Firestone .............................................. A1/P1 5.80 12/4/95 14,000 13,993,233
Countrywide Funding ................................................ A1/F1** 5.75 12/8/95 23,000 22,974,285
Countrywide Funding ................................................ A1/F1** 5.77 12/12/95 22,000 21,961,213
Dakota SCCMT ....................................................... A1+/P1 5.73 12/6/95 35,000 34,972,146
Dynamic Funding .................................................... A1/P1 5.80 12/1/95 23,200 23,200,000
Enterprise Funding (c) ............................................. A1/P1 5.77 12/26/95 13,601 13,546,501
Ford Motor Credit Corp. ............................................ A1/P1 5.70 12/22/95 38,000 37,873,650
--------------
284,381,721
--------------
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
S&P/MOODY'S PRINCIPAL AMORTIZED
RATING MATURITY AMOUNT COST
(UNAUDITED) RATE DATE (000) (NOTE 2)
------------ ---- -------- --------- --------------
<S> <C> <C> <C> <C> <C>
FOREIGN -- 6.1%
Den Danske Bank .................................................... A1/P1 5.73% 12/29/95 $ 28,000 $ 27,875,213
Ontario Hydro ...................................................... A1+/P1 5.69 12/29/95 35,000 34,845,106
Yorkshire Building Society ......................................... A1/P1 5.71 12/29/95 48,000 47,786,827
--------------
110,507,146
--------------
TOTAL COMMERCIAL PAPER (AMORTIZED COST $394,888,867).................. 394,888,867
--------------
CORPORATE OBLIGATIONS -- 30.7%
Bankers Trust - Floating Rate Note * ............................... A1/P1 5.89 12/1/95 50,000 50,000,000
Beta Finance - Medium Term Corporate Note (a) ...................... A1+/P1 5.97 7/17/96 35,000 35,000,000
Beta Finance - Corporate Floating Rate Note * ...................... A1+/P1 5.90 12/1/95 40,000 40,000,000
C.S. First Boston Corp., - Medium Term Floating Rate Note *(a) ..... A1/P1 5.99 1/2/96 40,000 40,000,000
C.S. First Boston Corp., - Extendible Floating Rate Note (c) * ..... A1/P1 5.91 12/21/95 35,000 35,000,000
Ford Motor Credit Corp., - Medium Term Floating Rate Note * ........ A1/P1 6.06 1/15/96 40,000 40,084,758
Goldman Sachs & Co., - Floating Rate Note * ........................ A1+/P1 5.91 12/5/95 50,000 50,000,000
PHH Corp.,- Medium Term Floating Rate Note * ....................... A1/P1 5.86 12/1/95 50,000 49,989,380
SMM Trust 1995 B - Medium Term Floating Rate Note * ................ A1+/P1 5.88 12/4/95 30,000 30,000,000
SMM Trust 1995 N - Medium Term Floating Rate Note * ................ A1+/P1 5.93 2/15/96 35,000 35,000,000
Steers 1994-1st USA Bank - Medium Term Floating Rate Note *(a) ..... A1+/P1 5.81 12/15/95 50,000 50,000,000
Steers/Anagram - Floating Rate Note *(a) ........................... A1+/D1+** 5.86 12/26/95 35,000 35,000,000
Steers/Merrill Lynch - Floating Rate Note *(a) ..................... F1**/P1 5.86 12/18/95 65,000 64,999,387
--------------
TOTAL CORPORATE OBLIGATIONS (AMORTIZED COST $555,073,525)............. 555,073,525
--------------
MASTER NOTE -- 2.7%
Lehman Brothers PLC, Master Note (c) ............................... A1/D1** 5.91 12/20/95 50,000 50,000,000
--------------
TOTAL MASTER NOTES (AMORTIZED COST $50,000,000)....................... 50,000,000
--------------
TIME DEPOSITS -- 6.9%
Bank of Tokyo, Ltd., Grand Cayman Branch ........................... A1/P1 5.90 12/28/95 25,000 25,000,000
Bank of Tokyo, Ltd., Grand Cayman Branch ........................... A1/P1 5.97 12/29/95 30,000 30,000,000
Mitsubishi Bank, Ltd., London Branch ............................... A1+/P1 5.81 12/27/95 30,000 30,000,000
South Trust Bank Variable Rate, Grand Cayman Branch * .............. A1/P1 5.81 12/29/95 40,000 40,000,000
--------------
TOTAL TIME DEPOSITS (AMORTIZED COST $125,000,000)..................... 125,000,000
--------------
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
S&P/MOODY'S PRINCIPAL AMORTIZED
RATING MATURITY AMOUNT COST
(UNAUDITED) RATE DATE (000) (NOTE 2)
------------ ---- -------- --------- --------------
<S> <C> <C> <C> <C> <C>
U.S. GOVERNMENT AGENCY OBLIGATIONS -- 3.6%
Federal Home Loan Bank ............................................. AAA/Aaa*** 5.90% 7/25/96 $ 30,000 $ 30,000,000
Federal National Mortgage Assoc. Variable Rate Medium Term Note* ... AAA/Aaa*** 5.81 10/4/96 35,000 34,988,218
--------------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS (AMORTIZED COST
$64,988,218)........................................................ 64,988,218
--------------
TOTAL INVESTMENTS IN SECURITIES (AMORTIZED COST $1,633,793,549)....... 1,633,793,549
--------------
REPURCHASE AGREEMENTS -- 11.5%
Merrill Lynch Securities, Inc., dated 11/30/95 with a maturity value
of $103,755,219 (Collateralized by $164,243,682 various U.S.
Government Agencies, 3.63% - 13.90%, 3/15/97 - 11/25/23, market
value -- $105,813,665)............................................ 5.95 12/1/95 103,738 103,738,073
Salomon Brothers, dated 11/30/95, with a maturity value of
$103,755,219 (Collateralized by $135,515,984 various U.S.
Government agencies, 5.50% - 9.50%, 10/1/06 - 11/1/25, market
value -- $106,407,853)............................................ 5.95 12/1/95 103,738 103,738,073
--------------
TOTAL REPURCHASE AGREEMENTS (AMORTIZED COST $207,476,146)............. 207,476,146
--------------
TOTAL INVESTMENTS (AMORTIZED COST $1,841,269,695) (B) -- 101.7%....... 1,841,269,695
PAYABLE TO BROKERS FOR SECURITIES PURCHASED -- (1.9%)................. (35,090,411)
OTHER ASSETS IN EXCESS OF LIABILITIES -- 0.2%......................... 3,480,405
--------------
NET ASSETS -- 100.0%.................................................. $1,809,659,689
--------------
--------------
</TABLE>
- -------------
(a) 144a security which is restricted as to resale to institutional investors.
(b)Cost for federal income tax and financial reporting purposes are the same.
(c)Represents a restricted security.
* Variable rate security. Maturity date reflects the later of the next
interest rate change date or the next put date.
**Duff Phelps or Fitch Investors ratings.
***Long-Term rating.
See Notes to Financial Statements.
6
<PAGE>
EMERALD PRIME FUND
- --------------------------------------------------------------------------------
Statement of Assets and Liabilities
November 30, 1995
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments in securities (amortized cost $1,633,793,549)............................... $ 1,633,793,549
Repurchase agreements (amortized cost $207,476,146)..................................... 207,476,146
Cash.................................................................................... 194,531
Interest receivable..................................................................... 9,785,378
Prepaid expenses and other.............................................................. 5,910
---------------
Total assets.............................................................................. 1,851,255,514
---------------
LIABILITIES:
Dividends payable....................................................................... 5,545,108
Payable to brokers for securities purchased............................................. 35,090,411
Accrued expenses:
Investment Advisory fees.............................................................. 272,079
Administration fees................................................................... 131,661
Shareholder Services fees (Emerald Service Shares).................................... 429,903
Custodian and transfer agent fees..................................................... 71,679
Other................................................................................. 54,984
---------------
Total liabilities......................................................................... 41,595,825
---------------
NET ASSETS................................................................................ $ 1,809,659,689
---------------
---------------
Shares Outstanding ($0.001 par value, unlimited number of shares authorized):
Emerald Shares.......................................................................... 462,636,209
Emerald Service Shares.................................................................. 901,831,725
Investor Shares......................................................................... 444,841,816
---------------
Total Shares Outstanding.................................................................. 1,809,309,750
---------------
---------------
Net Asset Value, offering price and redemption price per share:
Emerald Shares.......................................................................... $ 1.00
Emerald Service Shares.................................................................. 1.00
Investor Shares......................................................................... 1.00
---------------
---------------
COMPOSITION OF NET ASSETS:
Shares of beneficial interest, at par................................................... $ 1,809,310
Additional paid-in capital.............................................................. 1,807,500,440
Accumulated net realized gains on investment transactions............................... 349,939
---------------
Net Assets, November 30, 1995............................................................. $ 1,809,659,689
---------------
---------------
</TABLE>
- ------------
See Notes to Financial Statements.
7
<PAGE>
EMERALD PRIME FUND
- --------------------------------------------------------------------------------
Statement of Operations
For the year ended November 30, 1995
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Interest...................................................................... $ 97,394,992
EXPENSES:
Investment Advisory fees...................................................... $ 4,036,274
Administration fees........................................................... 1,451,221
Shareholder Services fees (Emerald Service Shares)............................ 2,814,354
Distribution expenses (Investor Shares)....................................... 1,523,904
Transfer agent fees and expenses.............................................. 107,225
Custodian fees and expenses................................................... 501,967
Insurance expense............................................................. 47,414
Legal fees.................................................................... 18,603
Audit fees.................................................................... 39,423
Reports to shareholders (Investor Shares)..................................... 122,497
Reports to shareholders (Emerald Shares)...................................... 17,371
Reports to shareholders (Emerald Service Shares).............................. 12,162
Trustees' fees................................................................ 12,767
Registration fees............................................................. 50,203
Organization costs............................................................ 571
Other expenses................................................................ 47,358
-------------
10,803,314
Less: Fee waivers and expense reimbursements.................................. (392,096) 10,411,218
------------- -------------
Net Investment Income:.......................................................... 86,983,774
REALIZED GAINS ON INVESTMENTS:
Net realized gains on securities transactions................................. 410,900
-------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS............................ $ 87,394,674
-------------
-------------
</TABLE>
- ------------
See Notes to Financial Statements.
8
<PAGE>
EMERALD PRIME FUND
- --------------------------------------------------------------------------------
Statements of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEARS ENDED
----------------------------------
NOVEMBER 30, NOVEMBER 30,
1995 1994
--------------- ----------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
Operations
Net investment income............................................... $ 86,983,774 $ 51,203,807
Net realized gains (losses) on securities transactions.............. 410,900 (4,215,244)
--------------- ----------------
Net increase in net assets resulting from operations................ 87,394,674 46,988,563
--------------- ----------------
Dividends to shareholders from net investment income
Emerald Shares...................................................... (28,634,317) (20,344,804)
Emerald Service Shares.............................................. (42,688,668) (24,761,375)
Investor Shares..................................................... (15,660,789) (6,097,628)
--------------- ----------------
Total dividends to shareholders from net investment income............ (86,983,774) (51,203,807)
--------------- ----------------
Fund Share Transactions (at $1.00 per share)
Net proceeds from shares subscribed................................. 5,168,375,553 5,443,207,056
Net asset value of shares issued to shareholders in reinvestment of
dividends and distributions....................................... 21,301,269 10,425,249
Cost of shares redeemed............................................. (4,836,350,261) (5,308,737,968)
--------------- ----------------
Net increase in net assets from Fund share transactions............. 353,326,561 144,894,337
--------------- ----------------
Increase due to voluntary capital contribution........................ -- 4,257,069
--------------- ----------------
Total Increase........................................................ 353,737,461 144,936,162
NET ASSETS:
Beginning of period................................................. 1,455,922,228 1,310,986,066
--------------- ----------------
End of period....................................................... $ 1,809,659,689 $ 1,455,922,228
--------------- ----------------
--------------- ----------------
</TABLE>
- ------------
See Notes to Financial Statements.
9
<PAGE>
EMERALD TREASURY FUND
- --------------------------------------------------------------------------------
Portfolio of Investments
November 30, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL AMORTIZED
MATURITY AMOUNT COST
RATE DATE (000) (NOTE 2)
----------- --------- --------- -------------
<S> <C> <C> <C> <C>
SHORT-TERM INVESTMENTS -- 100.2%
U.S. GOVERNMENT OBLIGATIONS -- 41.2%
U.S. TREASURY BILLS -- 18.3%
U.S. Treasury Bill................................................. 5.64%+ 12/21/95 $ 50,000 $ 49,844,722
U.S. Treasury Bill................................................. 5.29+ 3/7/96 100,000 98,571,271
-------------
148,415,993
-------------
U.S. TREASURY NOTES -- 22.9%
U.S. Treasury Note................................................. 4.00 1/31/96 75,000 74,789,094
U.S. Treasury Note................................................. 4.63 2/15/96 35,000 34,927,637
U.S. Treasury Note................................................. 4.63 2/29/96 25,000 24,941,084
U.S. Treasury Note................................................. 9.38 4/15/96 50,000 50,676,676
-------------
185,334,491
-------------
TOTAL U.S. GOVERNMENT OBLIGATIONS
(AMORTIZED COST $333,750,484)...................................... 333,750,484
-------------
REPURCHASE AGREEMENTS -- 59.0%
CS First Boston Corp., dated 11/30/95, with a maturity value of
$40,006,556 (Collateralized by $36,545,000 U.S. Treasury Notes,
8.88%, 2/15/99, market value - $40,994,173)...................... 5.90 12/1/95 40,000 40,000,000
Fuji Securities, Inc., dated 11/30/95, with a maturity value of
$74,197,115 (Collateralized by $144,660,000 various U.S.
Government securities, 0.00% - 12.75% 4/30/96 - 2/15/23, market
value - $75,669,761)............................................. 5.90 12/1/95 74,185 74,184,957
J.P. Morgan Securities, dated 11/30/95, with a maturity value of
$40,006,556 (Collateralized by $37,218,000 U.S. Treasury Notes,
8.25%, 7/15/98, market value - $41,951,664)...................... 5.90 12/1/95 40,000 40,000,000
Merrill Lynch Securities, Inc., dated 11/30/95, with a maturity
value of $74,197,116 (Collateralized by $168,004,000 U.S.
Treasury Stripped Notes, 5.75% - 12.00%, 2/15/96 -2/15/20, market
value - $75,669,442)............................................. 5.90 12/1/95 74,185 74,184,958
Morgan Stanley & Co., dated 11/30/95, with a maturity value of
$150,096,833 (Collateralized by $184,699,338 Government National
Mortgage Assoc., 6.50% - 8.50%, 1/1/00 - 3/20/25, market value -
$154,946,737)................................................... 5.81 12/4/95 150,000 150,000,000
Prudential Securities, Inc., dated 11/30/95, with a maturity value
of $40,006,544 (Collateralized by $50,437,000 various U.S.
Treasury securities, 0.00% - 6.88%, 4/30/97 - 6/15/23, market
value - $40,800,025)............................................. 5.89 12/1/95 40,000 40,000,000
Sanwa BGK Securities, dated 11/30/95, with a maturity value of
$60,009,833 (Collateralized by $59,233,000 U.S. Treasury Notes
and Bills, 0.00% - 6.88%, 9/19/96 - 2/15/03, market value -
$61,200,163).................................................... 5.90 12/1/95 60,000 60,000,000
-------------
TOTAL REPURCHASE AGREEMENTS (AMORTIZED COST $478,369,915)............ 478,369,915
-------------
TOTAL INVESTMENTS (AMORTIZED COST $812,120,399) (A) -- 100.2%........ 812,120,399
LIABILITIES IN EXCESS OF ASSETS -- (0.2%)............................ (1,072,574)
-------------
NET ASSETS -- 100.0%................................................. $ 811,047,825
-------------
-------------
</TABLE>
- ---------------
+ Effective yield at date of issuance.
(a)Cost for federal income tax and financial reporting purposes are the same.
See Notes to Financial Statements.
10
<PAGE>
EMERALD TREASURY FUND
- --------------------------------------------------------------------------------
Statement of Assets and Liabilities
November 30, 1995
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments in securities (amortized cost $333,750,484)............................ $ 333,750,484
Repurchase agreements (amortized cost $478,369,915)................................ 478,369,915
Interest receivable................................................................ 2,449,984
Prepaid expenses and other......................................................... 20,572
-------------
Total assets......................................................................... 814,590,955
-------------
LIABILITIES:
Dividends payable.................................................................. 3,090,411
Accrued expenses and other payables:
Investment Advisory fees......................................................... 136,024
Administration fees.............................................................. 40,287
Shareholder Services fees (Emerald Service Shares)............................... 152,403
Distribution expenses (Investor Shares).......................................... 17,401
Custodian and transfer agent fees................................................ 46,207
Other............................................................................ 60,397
-------------
Total liabilities.................................................................... 3,543,130
-------------
NET ASSETS........................................................................... $ 811,047,825
-------------
-------------
Shares Outstanding ($0.001 par value, unlimited number of shares authorized):
Emerald Shares..................................................................... 236,482,130
Emerald Service Shares............................................................. 525,808,234
Investor Shares.................................................................... 49,065,263
-------------
-------------
Total Shares Outstanding............................................................. 811,355,627
-------------
-------------
Net Asset Value, offering price and redemption price per share:
Emerald Shares..................................................................... $ 1.00
Emerald Service Shares............................................................. 1.00
Investor Shares.................................................................... 1.00
-------------
-------------
COMPOSITION OF NET ASSETS:
Shares of beneficial interest, at par.............................................. $ 811,356
Additional paid-in capital......................................................... 810,544,271
Accumulated net realized losses on investment transactions......................... (307,802)
-------------
Net Assets, November 30, 1995........................................................ $ 811,047,825
-------------
-------------
</TABLE>
- -------------
See Notes to Financial Statements.
11
<PAGE>
EMERALD TREASURY FUND
- --------------------------------------------------------------------------------
Statement of Operations
For the year ended November 30, 1995
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME: $ 48,196,732
-------------
EXPENSES:
Investment Advisory fees............................................ $ 2,049,210
Administration fees................................................. 797,128
Shareholder Services fees (Emerald Service Shares).................. 1,898,193
Distribution expenses (Investor Shares)............................. 200,869
Transfer agent fees and expenses.................................... 81,992
Custodian fees and expenses......................................... 339,437
Insurance expense................................................... 50,294
Legal fees.......................................................... 17,344
Audit fees.......................................................... 29,474
Reports to shareholders (Emerald Shares)............................ 2,808
Reports to shareholders (Emerald Service Shares).................... 10,095
Reports to shareholders (Investor Shares)........................... 39,058
Trustees' fees...................................................... 12,448
Other expenses...................................................... 53,738
------------
5,582,088
Less: Fee waivers and expense reimbursements.......................... (225,991) 5,356,097
------------ -------------
Net Investment Income................................................. 42,840,635
REALIZED LOSSES ON INVESTMENTS:
Net realized losses on securities transactions...................... (195,517)
-------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.................. $ 42,645,118
-------------
-------------
</TABLE>
- ------------
See Notes to Financial Statements.
12
<PAGE>
EMERALD TREASURY FUND
- --------------------------------------------------------------------------------
Statements of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEARS ENDED
-----------------------------------
NOVEMBER 30, NOVEMBER 30,
1995 1994
---------------- ----------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
Operations
Net investment income......................................................... $ 42,840,635 $ 31,451,367
Net realized losses on securities transactions................................ (195,517) (71,013)
---------------- ----------------
Net increase in net assets resulting from operations.......................... 42,645,118 31,380,354
---------------- ----------------
Dividends to shareholders from net investment income
Emerald Shares................................................................ (13,077,345) (14,395,122)
Emerald Service Shares........................................................ (27,761,370) (16,162,692)
Investor Shares............................................................... (2,001,920) (893,553)
---------------- ----------------
Total dividends to shareholders from net investment income...................... (42,840,635) (31,451,367)
---------------- ----------------
Fund Share Transactions (at $1.00 per Share)
Net proceeds from shares subscribed........................................... 2,613,725,098 2,482,018,262
Net asset value of shares issued to shareholders in reinvestment of
dividends................................................................... 3,365,762 1,616,555
Cost of shares redeemed....................................................... (2,714,202,606) (2,501,757,721)
---------------- ----------------
Net decrease in net assets from Fund share transactions......................... (97,111,746) (18,122,904)
---------------- ----------------
Total Decrease.................................................................. (97,307,263) (18,193,917)
NET ASSETS:
Beginning of period........................................................... 908,355,088 926,549,005
---------------- ----------------
End of period................................................................. $ 811,047,825 $ 908,355,088
---------------- ----------------
---------------- ----------------
</TABLE>
- ------------
See Notes to Financial Statements.
13
<PAGE>
EMERALD TAX-EXEMPT FUND
- --------------------------------------------------------------------------------
Portfolio of Investments
November 30, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MOODY'S/S&P PRINCIPAL AMORTIZED
RATINGS+ MATURITY AMOUNT COST
(UNAUDITED) RATE DATE (000) (NOTE 2)
--------------- --------- --------- ----------- -------------
<S> <C> <C> <C> <C> <C>
MUNICIPAL SECURITIES -- 99.7%
ALABAMA -- 2.5%
Birmingham General Obligation (LC First Alabama
Bank)*............................................. VMIG1/Aa2 3.70% 12/7/95 $ 3,000 $ 3,000,000
A-1+/AA
Homewood Industrial Dev. Bd., Revenue Bonds, Keebler
Co. Proj. (LC Northern Trust)*..................... NR/NR 3.85 12/7/95 560 560,000
NR/NR
Montgomery Cnty, PC & Solid Waste Dis. Rev. Ref.
Bonds, General Electric Co. Proj., Series 1990..... P-1/Aaa 3.75 12/14/95 1,300 1,300,000
-------------
A-1+/AAA 4,860,000
-------------
ALASKA -- 2.0%
Anchorage Higher Educational Revenue, Alaska Pacific
Univ. (LC Seattle First National Bank)*............ NR/NR 3.90 12/7/95 3,900 3,900,000
-------------
A-1+/AA-
ARIZONA -- 3.3%
Salt River Project, Ag. Imp. & Pwr. Dist............. P-1/NR 3.80 12/8/95 2,450 2,450,000
A-1+/NR
Salt River Project, Ag. Imp. & Pwr. Dist............. P-1/NR 3.75 12/14/95 4,000 4,000,000
-------------
A-1+/NR 6,450,000
-------------
COLORADO -- 0.6%
Pitkin County, Industrial Development, Aspen Skiing
Co. Project, Ser. B (AMT) (LC First National Bank
Chicago)*.......................................... NR/NR 3.95 12/1/95 1,200 1,200,000
-------------
A-1/A+
DISTRICT OF COLUMBIA -- 1.1%
District of Columbia, American University (LC
National Westminster)*............................. VMIG1/Aa2 3.65 12/7/95 2,200 2,200,000
-------------
NR/NR
FLORIDA -- 4.8%
City of Jacksonville, Commercial Paper Notes......... P-1/NR 3.80 12/13/95 1,500 1,500,000
A-1/NR
City of Jacksonville Pollution Auth. Rev. Ref. Bonds,
Florida Pwr. & Light Co. Proj...................... P-1/A1 3.70 12/15/95 8,000 8,000,000
-------------
A-1/AA- 9,500,000
-------------
</TABLE>
14
<PAGE>
<TABLE>
<CAPTION>
MOODY'S/S&P PRINCIPAL AMORTIZED
RATINGS+ MATURITY AMOUNT COST
(UNAUDITED) RATE DATE (000) (NOTE 2)
--------------- --------- --------- ----------- -------------
<S> <C> <C> <C> <C> <C>
GEORGIA -- 5.2%
Burke County Development Auth. Adj. Tender PC Rev.
Ref. Bds., Ogelthorpe Power Corp. (LC - Credit
Suisse)*........................................... P-1/Aa1 3.75% 2/13/96 $ 3,300 $ 3,300,000
A-1+/AA+
Columbia County, Elderly Auth., Residential Care
Facility Rev., Augusta Residential Ctr. on Aging
(LC Trust Co. Bank, Atlanta)*...................... VMIG1/Aa3 3.75 12/7/95 3,000 3,000,000
NR/NR
Fulton County Development Auth. Rev., Georgia Tech.
Athletic Assn., Inc. (LC Trust Co. Bank,
Atlanta)*.......................................... NR/Aa3 3.75 12/7/95 3,000 3,000,000
NR/NR
Municipal Gas Auth. of Georgia, Gas Rev. Bonds, Ser.
B (LC Wachovia Bank)............................... VMIG1/Aa2 3.90 3/14/96 1,000 1,000,000
-------------
NR/NR 10,300,000
-------------
ILLINOIS -- 15.9%
Cook County General Obligation, Capital Equipment,
Ser. A*............................................ VMIG1/MIG1 3.80 12/7/95 1,800 1,800,000
A-1/A+
Illinois Educational Facs. Auth. Rev., DePaul Univ.,
Ser. 1992 CP-1 (LC Sanwa Bank, Chicago)*........... VMIG1/Aa3 4.05 12/7/95 2,300 2,300,000
A-1+/AA-
Illinois Educational Facs. Auth. Rev., Field Museum
Nat. Hist. (LC Sanwa Bank)*........................ VMIG1/Aa3 4.00 12/7/95 5,700 5,700,000
NR/NR
Illinois Health Fac. Auth., Revolving Fund,
University of Chicago.............................. VMIG1/Aaa 3.90 2/8/96 8,400 8,400,000
A-1+/AA
Illinois Health Fac. Auth. Rev., Franciscan Sisters
Health*............................................ VMIG1/A 4.10 12/1/95 2,850 2,850,000
NR/NR
Illinois Health Fac. Auth. Rev., Elmhurst Memorial
Hospital, Series B*................................ VMIG1/A1 4.10 12/1/95 1,950 1,950,000
NR/NR
Rockton Village Industrial Project Rev., Specialty
Equipment Co., Inc. Project, Ser. 1994, (AMT) (LC
Barclays Bank)*.................................... NR/NR 4.00 12/7/95 2,300 2,300,000
A-1+/AA
Village of Hillside, Econ. Dev. Rev., L&J
Technologies Proj., Ser. 94 (AMT) (LC Northern
Trust)*............................................ NR/NR 4.00 12/7/95 6,000 6,000,000
-------------
A-1+/AA- 31,300,000
-------------
INDIANA -- 6.4%
Evansville Industrial Dev. Auth., Keebler Co. Proj.,
Ser. 93 (LC - Northern Trust)*..................... NR/NR 3.85 12/7/95 505 505,000
NR/NR
Gary Environmental Improvement Rev., U.S. Steel
Corp., Ser. 84 (LC Bank of Nova Scotia)*........... P1/Aa3 3.90 12/15/95 1,000 1,000,000
A-1+/AA-
</TABLE>
15
<PAGE>
<TABLE>
<CAPTION>
MOODY'S/S&P PRINCIPAL AMORTIZED
RATINGS+ MATURITY AMOUNT COST
(UNAUDITED) RATE DATE (000) (NOTE 2)
--------------- --------- --------- ----------- -------------
<S> <C> <C> <C> <C> <C>
INDIANA -- 6.4% (CONT.)
Indiana Dev. Fin. Auth. Rev. Mid America Project.
(AMT) (LC Union Bank of Switzerland)*.............. NR/NR 4.10% 12/7/95 $ 5,000 $ 5,000,000
A-1+/AAA
Indiana Health Fac. Financing Auth. Rev. (LC Comerica
Bank)*............................................. VMIG1/A1 3.90 12/7/95 1,400 1,400,000
NR/NR
Indiana Hospital Equipment Financing Auth., Ser. 85-A
(MBIA Insured)*.................................... VMIG1/Aaa 3.90 12/7/95 4,800 4,800,000
-------------
A-1/AAA 12,705,000
-------------
KENTUCKY -- 1.0%
Kentucky Housing Corp., Housing Rev., Ser. E AMT*.... VMIG1/Aaa 3.70% 12/20/95 2,000 2,000,000
-------------
A-1+/AAA
LOUISIANA -- 14.4%
Calcasieu Parish Industrial Dev. Environmental Rev.,
Citgo Petroleum Corp. (AMT) (LC Banque Nationale de
Paris)*............................................ VMIG1/Aa3 3.90 12/1/95 1,000 1,000,000
NR/NR
Jefferson Parish Hospital Service Dist. No. 1, West
Jefferson Medical Center (LC Citibank, New
York)*............................................. VMIG1/Aa3 3.75 12/7/95 10,070 10,070,000
A-1/AA-
Lake Charles District Port. Fac. Rev., Citgo
Petroleum Corp., Ser. 1984 (LC West Deutsche
Landesbank)*....................................... P1/Aa1 3.65 12/7/95 3,300 3,300,000
NR/NR
Louisiana Public Facility Auth. Rev., College & Univ.
Equip. & Cap., Ser. A (FGIC Insured)*.............. VMIG1/Aaa 3.60 12/7/95 4,500 4,500,000
A-1/AAA
Louisiana Public Facility Auth. Rev., Multifamily
Mortgage, Edgewood, General Electric Capital
Guaranty*.......................................... NR/NR 3.70 12/7/95 2,200 2,200,000
A-1+/AAA
Plaquemines Port, Harbor & Terminal, Electro-Coal
Transfer Corp., Ser. 1985C......................... P1/NR 3.90 12/12/95 2,000 2,000,000
A-1/NR
Plaquemines Port, Harbor & Terminal, Electro-Coal
Transfer Corp., Ser. 1985C......................... P1/NR 3.90 2/23/96 5,275 5,275,000
-------------
A-1/NR 28,345,000
-------------
MARYLAND -- 2.8%
Baltimore County, Ser. 1995.......................... P-1/NR 3.80 12/11/95 5,500 5,500,000
-------------
A-1+/NR
MAINE -- 3.3%
Bailesyville PCR Bonds, Georgia Pacific Corp., (LC
Bank of Tokyo)*.................................... P-1/Aa3 3.88 12/7/95 6,500 6,500,000
-------------
NR/NR
</TABLE>
16
<PAGE>
<TABLE>
<CAPTION>
MOODY'S/S&P PRINCIPAL AMORTIZED
RATINGS+ MATURITY AMOUNT COST
(UNAUDITED) RATE DATE (000) (NOTE 2)
--------------- --------- --------- ----------- -------------
<S> <C> <C> <C> <C> <C>
MISSOURI -- 3.6%
Missouri Health & Education Fac. SSM Health Care (LC
Mitsubishi Bank, Ltd.)*............................ VMIG1/Aa3 4.00% 12/1/95 $ 5,000 $ 5,000,000
NR/NR
Missouri Hsg. Dev. Comm. Rev., Single Family Mtge.
Rev., Ser. 1995 D (AMT)............................ NR/NR 4.20 11/1/96 2,000 2,000,000
-------------
A-1+/AAA 7,000,000
-------------
MINNESOTA -- 0.7%
Becker Pollution Control Rev. Northern States Power
Co., Ser. 1993A.................................... VMIG1/NR 3.60 5/10/96 1,400 1,400,000
-------------
A-1/NR
NEBRASKA -- 1.0%
Nebraska Invt. Fin. Auth., Indl. Dev. Rev., Fremont
Beef Project (LC Sanwa Bank Ltd.)*................. P-1/NR 4.25 12/7/95 2,000 2,000,000
-------------
NR/NR
NEW YORK -- 4.9%
New York City General Obligation, Tax Anticipation
Notes, Ser. 1996A.................................. MIG1/NR 4.50 2/15/96 9,700 9,713,012
-------------
SP-1+/NR
NORTH DAKOTA -- 0.2%
Grand Forks Health Care Facs. United Hosp. Oblig.
Group Project (LC Fuji Bank Ltd., Chicago)*........ VMIG1/A1 4.10 12/1/95 500 500,000
-------------
NR/NR
OHIO -- 0.5%
Summit County Industrial Dev. Auth., Keebler Co.
Project, Ser. 93 (LC Northern Trust)*.............. NR/NR 3.85 12/7/95 995 995,000
-------------
NR/NR
PENNSYLVANIA -- 0.3%
Columbia County, Industrial Dev. Auth. Rev., Kleerdex
Co. Proj., (AMT) Ser. 90, (LC Bank of Tokyo)*...... NR/NR 4.30 12/7/95 700 700,000
-------------
A-1/A+
SOUTH CAROLINA -- 2.0%
South Carolina Public Service Commercial Paper
Notes.............................................. P-1/NR 3.80 12/13/95 4,000 4,000,000
-------------
A-1/NR
TENNESSEE -- 0.8%
Sullivan County Industrial Dev. Board Modern Forge
Project, (AMT), Ser. 90, (LC - Northern Trust)*.... NR/NR 4.00 12/7/95 1,500 1,500,000
-------------
A-1+/AA-
</TABLE>
17
<PAGE>
<TABLE>
<CAPTION>
MOODY'S/S&P PRINCIPAL AMORTIZED
RATINGS+ MATURITY AMOUNT COST
(UNAUDITED) RATE DATE (000) (NOTE 2)
--------------- --------- --------- ----------- -------------
<S> <C> <C> <C> <C> <C>
TEXAS -- 14.6%
Board of Regents of the University of Texas, Comm.
Paper Notes........................................ P-1/NR 3.80% 12/15/95 $ 9,800 $ 9,800,000
A-1+/NR
Brazos River Harbor Navigation, Dist. Harbor Rev.,
Dow Chemical Project 1992, Ser. A. (AMT)*.......... P1/A1 3.90% 12/1/95 500 500,000
A-1/A
City of Houston Ser. A, Commercial Paper Notes....... P-1/NR 3.75 3/7/96 3,700 3,700,000
A-1+/NR
City of Houston, Ser. 93-E*.......................... VMIG1/Aa 4.00 4/1/96 1,700 1,700,000
A-1+/AA-
Gulf Coast Industrial Dev. Auth., Marine Term. Rev.,
Ser. 1993, Amoco Oil Co. Project (AMT)*............ P-1/Aa1 3.80 12/1/95 1,100 1,100,000
A-1+/AAA
Gulf Coast Industrial Dev. Auth., Solid Waste
Disposal Rev., Citgo Petroleum Corp. (LC
NationsBank, Texas) (AMT)*......................... VMIG1/A1 3.85 12/1/95 1,100 1,100,000
NR/NR
San Antonio Water System Commercial Paper Notes, Ser.
1995............................................... P-1/NR 3.80 12/8/95 3,700 3,700,000
A-1/NR
Tarrant County Housing Fin. Corp., Multifamily
Hsg.-Sf. Apts. Projects (LC Societe Generale)*..... VMIG1/Aa2 3.65 12/7/95 4,050 4,050,000
NR/NR
Texas Tax & Revenue Anticipation Notes, Ser. A....... MIG1/NR 4.75 8/30/96 1,900 1,908,864
SP-1+/NR
Texas A & M University Board of Regents, Ser. B...... P-1/NR 3.90 2/28/96 1,200 1,200,000
-------------
A-1+/NR 28,758,864
-------------
UTAH -- 1.0%
Intermountain Power Agy., Pwr. Supply Rev., Ser. A
(Pre-Refunded on 7/1/96 @ 102)..................... AAA/NR 7.75 7/1/96 1,925 2,005,814
-------------
AA-/NR
VERMONT -- 3.5%
Vermont General Obligation, Commercial Paper Notes,
Ser. F............................................. P1/NR 3.85 12/13/95 6,900 6,900,000
-------------
A-1+/NR
VIRGINIA -- 2.5%
Louisa County, Industrial Development Auth. (LC
NationsBank, Virginia)*.............................. NR/NR 3.75 12/7/95 5,000 5,000,000
-------------
A-1/A+
</TABLE>
18
<PAGE>
<TABLE>
<CAPTION>
MOODY'S/S&P PRINCIPAL AMORTIZED
RATINGS+ MATURITY AMOUNT COST
(UNAUDITED) RATE DATE (000) (NOTE 2)
--------------- --------- --------- ----------- -------------
<S> <C> <C> <C> <C> <C>
WASHINGTON -- 0.8%
Pierce County Economic Dev. Corp., Dock & Wharf Fac.
Rev., SCS Industries Project (LC Bank of Tokyo,
Portland)*......................................... P1/NR 4.25% 12/7/95 $ 1,000 $ 1,000,000
NR/NR
Washington Health Care Facs. Auth. Rev., Fred
Hutchinson Cancer, Ser. A (LC Morgan Guaranty
Trust)*............................................ VMIG1/Aa1 3.90 12/1/95 600 600,000
-------------
NR/NR 1,600,000
-------------
TOTAL MUNICIPAL SECURITIES (AMORTIZED COST
$196,832,690)(A) -- 99.7%............................ 196,832,690
OTHER ASSETS IN EXCESS OF LIABILITIES -- 0.3%.......... 611,661
-------------
NET ASSETS -- 100.0%................................... $ 197,444,351
-------------
-------------
</TABLE>
- ---------------
+ The ratings provided consist of short-term and long-term ratings for both
Moody's and S&P. The rating consists of the short-term/long-term Moody's
ratings and the second consists of short-term/long-term S&P ratings.
* Variable rate security. Maturity date reflects the later of the next rate
change date or the next put date.
(a) Cost for federal income tax and financial reporting purposes are the same.
FGIC -- Financial Guaranty Insurance Corp.
LC -- Letter of credit.
AMT -- Interest on security is subject to Federal Alternative Minimum Tax.
NR -- Not rated.
See Notes to Financial Statements.
19
<PAGE>
EMERALD TAX-EXEMPT FUND
- --------------------------------------------------------------------------------
Statement of Assets and Liabilities
November 30, 1995
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investment in securities (amortized cost $196,832,690) ............................ $ 196,832,690
Cash .............................................................................. 74,687
Interest receivable ............................................................... 1,160,697
Prepaid expenses and other ........................................................ 8,494
-------------
Total assets ........................................................................ 198,076,568
-------------
LIABILITIES:
Dividends payable ................................................................. 479,529
Accrued expenses and other payables:
Investment Advisory fees ........................................................ 14,627
Administration fees ............................................................. 14,627
Distribution expenses (Investor Shares) ......................................... 13,830
Shareholder Services fees (Emerald Service Shares) .............................. 23,141
Custodian and transfer agent fees ............................................... 16,689
Other ........................................................................... 69,774
-------------
Total liabilities ................................................................... 632,217
-------------
NET ASSETS .......................................................................... $ 197,444,351
-------------
-------------
Shares Outstanding ($0.001 par value, unlimited number of shares authorized):
Emerald Shares .................................................................. 156,377,768
Emerald Service Shares .......................................................... 2,855,359
Investor Shares ................................................................. 38,242,869
-------------
Total Shares Outstanding ............................................................ 197,475,996
-------------
-------------
Net Asset Value, offering price and redemption price per share:
Emerald Shares .................................................................... $ 1.00
Emerald Service Shares ............................................................ 1.00
Investor Shares ................................................................... 1.00
-------------
-------------
COMPOSITION OF NET ASSETS:
Shares of beneficial interest, at par ............................................. $ 197,476
Additional paid-in capital ........................................................ 197,278,520
Accumulated net realized losses on investment transactions ........................ (31,645)
-------------
Net Assets, November 30, 1995 ....................................................... $ 197,444,351
-------------
-------------
</TABLE>
- ------------
See Notes to Financial Statements.
20
<PAGE>
EMERALD TAX-EXEMPT FUND
- --------------------------------------------------------------------------------
Statement of Operations
For the year ended November 30, 1995
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Interest ............................................................. $ 7,971,839
EXPENSES:
Investment Advisory fees ........................................... $ 506,689
Administration fees ................................................ 304,013
Distribution expenses (Investor Shares) ............................ 188,796
Shareholder Services fees (Emerald Service Shares) ................. 10,478
Transfer agent fees and expenses ................................... 61,637
Custodian fees and expenses ........................................ 85,061
Reports to shareholders (Emerald Shares) ........................... 4,269
Reports to shareholders (Emerald Service Shares) ................... 7,571
Reports to shareholders (Investor Shares) .......................... 40,796
Legal and audit fees ............................................... 53,387
Trustees' fees ..................................................... 12,266
Insurance expense .................................................. 6,684
Registration fees .................................................. 20,660
Organization fees .................................................. 571
Other expenses ..................................................... 11,281
-----------
1,314,159
Less: Fee waivers and expense reimbursements ......................... (309,650) 1,004,509
----------- -----------
Net Investment Income ................................................ 6,967,330
REALIZED LOSSES ON INVESTMENTS:
Net realized losses on securities transactions ..................... (903)
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ................. $ 6,966,427
-----------
-----------
</TABLE>
- ------------
See Notes to Financial Statements.
21
<PAGE>
EMERALD TAX-EXEMPT FUND
- --------------------------------------------------------------------------------
Statements of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEARS ENDED
---------------------------------
NOVEMBER 30, NOVEMBER 30,
1995 1994
-------------- ----------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
Operations
Net investment income ........................................................ $ 6,967,330 $ 4,494,772
Net realized losses on securities transactions ............................... (903) (3,430)
-------------- ----------------
Net increase in net assets resulting from operations ......................... 6,966,427 4,491,342
-------------- ----------------
Dividends to shareholders from net investment income
Emerald Shares ............................................................... (5,722,875) (3,682,883)
Emerald Service Shares ....................................................... (95,436) (61,167)
Investor Shares .............................................................. (1,149,019) (750,722)
-------------- ----------------
Total dividends to shareholders from net investment income ..................... (6,967,330) (4,494,772)
-------------- ----------------
Fund Share Transactions (at $1.00 per share)
Net proceeds from shares subscribed .......................................... 504,374,576 528,918,517
Net asset value of shares issued to shareholders in reinvestment of
dividends .................................................................. 1,626,585 856,850
Cost of shares redeemed ...................................................... (513,562,638) (518,386,286)
-------------- ----------------
Net increase (decrease) in net assets from Fund share transactions ........... (7,561,477) 11,389,081
-------------- ----------------
Total Increase (Decrease) ...................................................... (7,562,380) 11,385,651
NET ASSETS:
Beginning of period .......................................................... 205,006,731 193,621,080
-------------- ----------------
End of period ................................................................ $ 197,444,351 $ 205,006,731
-------------- ----------------
-------------- ----------------
</TABLE>
- ------------
See Notes to Financial Statements.
22
<PAGE>
EMERALD FUNDS
- --------------------------------------------------------------------------------
Notes to Financial Statements
- --------------------------------------------------------------------------------
NOTE 1 -- GENERAL
Emerald Funds (the "Trust") was organized as a Massachusetts business trust on
March 15, 1988. The Trust is registered under the Investment Company Act of
1940, as amended (the "Act"), as an open-end, management investment company. The
Trust operates as a series company currently comprising thirteen portfolios. The
accompanying financial statements and notes relate only to the Prime Fund,
Treasury Fund and Tax-Exempt Fund (the "Funds").
Barnett Banks Trust Company, N.A. ("Barnett") serves as the Funds'
investment adviser. Rodney Square Management Corporation (the "Sub-Adviser"), a
subsidiary of Wilmington Trust Company, serves as the Tax-Exempt Fund's
investment sub-adviser. Concord Holding Corporation ("Concord") serves as the
Funds' administrator and Emerald Asset Management, Inc. (the "Distributor")
serves as the distributor of the Funds' shares. Concord is a wholly owned
subsidiary of The BISYS Group, Inc. and the Distributor is a wholly owned
subsidiary of Concord.
The Funds each issue three classes of shares: Emerald Shares, Emerald
Service Shares and Investor Shares. Emerald Shares, Emerald Service Shares and
Investor Shares are substantially the same except that Emerald Service Shares
bear the fees that are payable under a Shareholder Services Plan (the "Service
Plan"), and Investor Shares bear the fees that are payable under a plan adopted
by the Board of Trustees pursuant to Rule 12b-1 under the Act (the "Distribution
Plan") and fees payable under a Shareholder and Administrative Services Plan
(the "Shareholder Plan"). In addition to fees paid pursuant to the Service Plan,
the Distribution Plan and the Shareholder Plan, each class of shares of each
Fund also bears the expenses associated with the printing of their shareholder
reports applicable to the particular class.
NOTE 2 -- SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by the
Funds in the preparation of their financial statements.
A)Security Valuation:
Portfolio securities are valued at amortized cost, which approximates market
value. The amortized cost method involves valuing a security at cost on the date
of purchase and thereafter assuming a constant amortization to maturity of the
difference between the principal amount due at maturity and initial cost. In
addition, the Funds may not (a) purchase any instrument with a remaining
maturity greater than thirteen months unless such instrument is subject to a
demand feature, or (b) maintain a dollar-weighted average maturity which exceeds
90 days.
B)Securities Transactions and Investment Income:
Securities transactions are recorded on the trade date. Realized gains and
losses on the sales of investments are calculated on the identified cost basis.
Interest income, including accretion of discount and amortization of premium on
investments, is accrued daily.
C)Dividends and Distributions to Shareholders:
Dividends from net investment income are declared daily to shareholders and are
paid monthly. Distributions of net realized gains, if any, will be paid at least
annually. However, to the extent that net realized gains of a Fund can be
reduced by any capital loss carryovers of that Fund, such gains will not be
distributed.
The amounts of dividends from net investment income and of distributions
from net realized gains are determined in accordance with federal income tax
regulations which may differ from generally accepted accounting principles.
These "book/tax" differences are either considered temporary or permanent in
nature. To the extent these differences are permanent in nature, such amounts
are reclassified within the composition of net assets based on their federal
tax-basis treatment; temporary differences do not require reclassification.
Dividends and distributions to shareholders which exceed net investment income
and net realized capital gains for financial reporting purposes but not for tax
purposes are reported as dividends in excess of net investment income or net
distributions in excess of net realized
23
<PAGE>
- --------------------------------------------------------------------------------
gains. To the extent they exceed net investment income and net realized gains
for tax purposes, they are reported as distributions of capital.
D)Repurchase Agreements:
The Funds' custodian and other banks acting in a sub-custodian capacity take
possession of the collateral pledged for investments in repurchase agreements.
The underlying collateral is valued daily on a mark-to-market basis to determine
that the value, including accrued interest, exceeds the repurchase price. In the
event of the seller's default of the obligation to repurchase, the Funds have
the right to liquidate the collateral and apply the proceeds in satisfaction of
the obligation. Under certain circumstances, in the event of default or
bankruptcy by the other party to the agreement, realization and/or retention of
the collateral may be subject to legal proceedings.
E)Lending Securities:
If the Prime Fund or the Treasury Fund lends its securities, the Fund receives
from the borrower collateral, in the form of cash or U.S. Government securities
or, in the case of the Prime Fund, securities of U.S. Government agencies or
instrumentalities or an irrevocable letter of credit issued by a bank that meets
the credit standards of the Prime Fund, in an amount at least equal at all times
to the market value of the securities loaned. The Fund continues to receive
interest on the securities loaned and may simultaneously earn interest on the
collateral held. The Fund records and values such collateral at its market value
on the date of receipt and marks-to-market such collateral on a daily basis
through maturity date. If the borrower defaults and the value of the collateral
declines or if bankruptcy proceedings are commenced with respect to the borrower
of the security, realization of the collateral by the Funds may be delayed or
limited.
F)Expenses:
The Trust accounts separately for the assets, liabilities and operations of each
Fund. Direct expenses of a Fund are charged to that Fund while general Trust
expenses are allocated among the Trust's respective portfolios.
The investment income and expenses of a Fund (other than expenses incurred
under the Service Plan, the Distributor Plan, the Shareholder Plan and the
reports to shareholders expense) and realized and unrealized gains and losses on
investments of a Fund are allocated to separate classes of shares based upon
their relative net asset value on the date income is earned or expenses and
realized and unrealized gains and losses are incurred.
All costs incurred by the Funds in connection with the organization of the
Trust and the initial public offering of shares of the Funds, principally
professional fees and printing costs, have been deferred. Upon commencement of
investment operations of each Fund, the deferred organization expenses are being
amortized on a straight-line basis over a period of five years.
G)Federal Income Taxes:
For federal income tax purposes, each Fund is treated as a separate entity for
the purpose of determining its qualification as a regulated investment company
under the Internal Revenue Code (the"Code"). It is the policy of each Fund to
meet the requirements of the Code applicable to regulated investment companies,
including the requirement that it distribute substantially all of its taxable
income to shareholders. Therefore, no federal income tax provision is required.
At November 30, 1995, the following Funds had the following capital loss
carryovers:
<TABLE>
<CAPTION>
EXPIRATION
AMOUNT DATE
--------- -----------
<S> <C> <C>
Treasury Fund.................... $ 4,829 2000
40,894 2001
70,799 2002
195,517 2003
---------
$ 312,039
---------
---------
Tax-Exempt Fund.................. $ 8,643 1997
14,779 1998
2,875 2000
1,015 2001
3,430 2002
903 2003
---------
$ 31,645
---------
---------
</TABLE>
These capital loss carryovers may be used to offset any future realized
gains on securities transactions to the extent provided in the regulations under
24
<PAGE>
- --------------------------------------------------------------------------------
the Code. To the extent utilized, each Fund will reduce amounts otherwise
payable to shareholders from net realized gains. For the fiscal year ended
November 30, 1995, the Prime Fund utilized $48,107 of capital loss carryovers.
NOTE 3 -- AGREEMENTS AND OTHER TRANSACTIONS WITH AFFILIATES
The Trust has entered into an Investment Advisory Agreement with Barnett,
Administration Agreements with Concord and a Distribution Agreement with the
Distributor. In addition, Barnett, has entered into a Sub-Advisory Agreement
with the Sub-Advisor with respect to the Tax-Exempt Fund.
As investment adviser, Barnett manages the investments of each Fund except
the Tax-Exempt Fund and is responsible for all purchases and sales of each
Fund's portfolio securities (except the Tax-Exempt Fund). The Sub-Adviser has
similar responsibilities for the Tax-Exempt Fund, subject to the general
supervision of both the Board of Trustees and Barnett. For its services, Barnett
is entitled to receive a fee based on each Fund's average daily net assets at
the following annual rates:
<TABLE>
<S> <C>
Prime Fund.......................... 0.25%
Treasury Fund....................... 0.25%
Tax-Exempt Fund..................... 0.25%
</TABLE>
Barnett has agreed to pay the Sub-Adviser a sub-advisory fee at an annual
rate of 0.15% of the average daily net assets of the Tax-Exempt Fund. Barnett
has also agreed to waive a portion of its fee from the Tax-Exempt Fund equal to
0.10% of the average daily net assets of the Fund. For the year ended November
30, 1995, Barnett waived fees of $202,676 from the Tax-Exempt Fund.
Barnett has voluntarily agreed to limit the fees it receives from the Prime
Fund and the Treasury Fund to the following annual rates: 0.25% of each Fund's
first $600 million of average daily net assets, 0.23% of the next $400 million
of each Fund's average daily net assets, 0.21% of the next $1 billion of each of
the Fund's average daily net assets and 0.19% of each Fund's average daily net
assets in excess of $2 billion. For the year ended November 30, 1995, Barnett
waived fees of $325,805 and $43,932 for the Prime Fund and Treasury Fund,
respectively.
As administrator, Concord assists in supervising the operations of the
Funds. For its services, Concord is entitled to a fee, accrued daily and payable
monthly, at the following annual rates:
PRIME FUND/TREASURY FUND
0.10% of each Fund's first $600 million of daily net assets
0.09% of each Fund's next $400 million of daily net assets
0.08% of each Fund's next $1 billion of daily net assets, and
0.07% of each Fund's daily net assets in excess of $2 billion
TAX-EXEMPT FUND
0.15% of the Fund's daily net assets
For the year ended November 30, 1995, there were no fees waived by Concord
for the Funds.
Barnett, Concord and the Sub-Adviser have voluntarily agreed to reimburse
fees payable to them with respect to each Fund to the extent a Fund's ordinary
operating expenses (including fees payable to Barnett, the Sub-Adviser and
Concord and excluding fees payable under the Service Plan, the Distribution Plan
and the Shareholder Plan) exceed 0.40% of such Fund's average daily net assets.
This voluntary reimbursement may be terminated at any time. For the year ended
November 30, 1995, Barnett and Concord each agreed to reimburse expenses in the
amount of $33,145 to the Prime Fund and $91,028 to the Treasury Fund for
expenses in excess of this limitation. For the year ended November 30, 1995,
Concord and the Sub-Adviser each reimbursed expenses in the amount of $53,487
for the Tax-Exempt Fund, pursuant to this voluntary agreement.
Under the Service Plan, institutions ("Service Organizations") agree to
provide support services to their clients who are beneficial owners of Emerald
Service Shares of the Funds. For these services, the Funds agreed to pay the
Service Organizations an annual fee of 0.35% of the average daily net asset
value of each Fund's Emerald Service Shares outstanding. These payments are
borne solely by Emerald Service Shares. Services are provided by Service
25
<PAGE>
- --------------------------------------------------------------------------------
Organizations which may include the Distributor, Barnett, the Sub-Adviser and
their affiliates. For the year ended November 30, 1995, the Prime Fund, Treasury
Fund and Tax-Exempt Fund incurred expenses of $2,814,354, $1,898,193 and
$10,478, respectively, pursuant to the Service Plan, substantially all of which
was earned by Barnett and its affiliates.
Under the Distribution Plan with respect to Investor Shares of the Funds,
each Fund pays the Distributor for distribution expenses incurred in connection
with the advertising and marketing of each Fund's Investor Shares and with the
implementation and operation of the Distribution Plan. Payments by each Fund for
distribution expenses under the Distribution Plan for Investor Shares may not
exceed an annual rate of 0.25% of the average daily net asset value of each
Fund's outstanding Investor Shares. In addition, the Shareholder Plan provides
for payments to the Administrator for certain administrative services that are
related to the distribution of Investor Shares. The Administrator is entitled to
payment for these services at the annual rate of 0.25% of the average daily net
asset value of each Fund's outstanding Investor Shares. For the year ended
November 30, 1995, the Prime Fund, Treasury Fund and Tax-Exempt Fund paid fees
of $1,523,904, $200,869 and $188,796, respectively pursuant to the Distribution
Plan and the Shareholder Plan.
Certain officers of the Trust are "affiliated persons" (as defined in the
Act) of Concord or the Distributor. Each Trustee receives an annual fee of
$14,000 and a meeting fee of $1,500 per meeting for services relating to all of
the portfolios constituting the Trust. Prior to June 1, 1995, each Trustee
received an annual fee of $9,000. For the year ended November 30, 1995, the
Funds incurred the following legal expenses of a law firm, a partner of which
serves as Secretary to the Trust:
<TABLE>
<S> <C>
Prime Fund......................... $ 18,603
Treasury Fund...................... 17,344
Tax-Exempt Fund.................... 16,925
</TABLE>
On June 30, 1994, Barnett purchased two securities from the Prime Fund at an
amount $4,257,069 in excess of the securities' fair market value. The Fund
recorded a realized loss on the sale and a capital contribution of an equal
amount from Barnett. Barnett received no shares of the Prime Fund or other
consideration in exchange for such contribution. For tax purposes, this capital
contribution was applied against the realized losses for the year ended November
30, 1994. Accordingly, this amount has been reclassified from additional paid-in
capital against accumulated net realized losses in the statement of assets and
liabilities.
NOTE 4 -- CAPITAL SHARE TRANSACTIONS
Transactions in shares of the Funds are summarized below:
PRIME FUND (000 OMITTED)
(AT $1.00 PER SHARE):
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
NOVEMBER 30, NOVEMBER 30,
1995 1994
------------ ------------
<S> <C> <C>
Emerald Shares
Shares sold............. 2,397,638 2,451,959
Shares issued to
shareholders in
reinvestment of
dividends and
distributions......... 1 342
Shares redeemed......... (2,348,560) (2,549,465)
------------ ------------
Net increase (decrease) in
Emerald Shares........... 49,079 (97,164)
------------ ------------
Emerald Service Shares
Shares sold............. 2,305,635 2,742,976
Shares issued to
shareholders in
reinvestment of
dividends and
distributions......... 5,644 3,558
Shares redeemed......... (2,243,151) (2,532,029)
------------ ------------
Net increase in Emerald
Service Shares........... 68,128 214,505
------------ ------------
Investor Shares
Shares sold............. 465,103 248,273
Shares issued to
shareholders in
reinvestment of
dividends and
distributions......... 15,656 6,525
Shares redeemed......... (244,639) (227,245)
------------ ------------
Net increase in Investor
Shares................... 236,120 27,553
------------ ------------
Total increase in Fund
shares................... 353,327 144,894
------------ ------------
------------ ------------
</TABLE>
26
<PAGE>
- --------------------------------------------------------------------------------
TREASURY FUND (000 OMITTED)
(AT $1.00 PER SHARE):
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
NOVEMBER 30, NOVEMBER 30,
1995 1994
------------ ------------
<S> <C> <C>
Emerald Shares
Shares sold............. 778,340 904,240
Shares redeemed......... (825,813) (1,121,685)
------------ ------------
Net decrease in Emerald
Shares................... (47,473) (217,445)
------------ ------------
Emerald Service Shares
Shares sold............. 1,705,061 1,489,756
Shares issued to
shareholders in
reinvestment of
dividends and
distributions......... 1,364 725
Shares redeemed......... (1,772,681) (1,302,244)
------------ ------------
Net increase (decrease) in
Emerald Service Shares... (66,256) 188,237
------------ ------------
Investor Shares
Shares sold............. 130,324 88,022
Shares issued to
shareholders in
reinvestment of
dividends and
distributions......... 2,002 891
Shares redeemed......... (115,709) (77,828)
------------ ------------
Net increase in Investor
Shares................... 16,617 11,085
------------ ------------
Total decrease in Fund
shares................... (97,112) (18,123)
------------ ------------
------------ ------------
</TABLE>
TAX-EXEMPT FUND (000 OMITTED)
(AT $1.00 PER SHARE):
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
NOVEMBER 30, NOVEMBER 30,
1995 1994
------------ ------------
<S> <C> <C>
Emerald Shares
Shares sold............. 411,931 414,315
Shares issued to
shareholders in
reinvestment of
dividends and
distributions......... 458 14
Shares redeemed......... (418,892) (398,994)
------------ ------------
Net increase (decrease) in
Emerald Shares........... (6,503) 15,335
------------ ------------
Emerald Service Shares
Shares sold............. 1,051 4,077
Shares issued to
shareholders in
reinvestment of
dividends and
distributions......... 20 9
Shares redeemed......... (2,244) (544)
------------ ------------
Net increase (decrease) in
Emerald Service Shares... (1,173) 3,542
------------ ------------
Investor Shares
Shares sold............. 91,392 110,526
Shares issued to
shareholders in
reinvestment of
dividends and
distributions......... 1,149 834
Shares redeemed......... (92,426) (118,848)
------------ ------------
Net increase (decrease) in
Investor Shares.......... 115 (7,488)
------------ ------------
Total increase (decrease)
in Fund shares........... (7,561) 11,389
------------ ------------
------------ ------------
</TABLE>
27
<PAGE>
- --------------------------------------------------------------------------------
NOTE 5 -- CONCENTRATION OF CREDIT RISK
The Prime Fund and Tax-Exempt Fund invest substantially all of their assets in a
diversified portfolio of high quality U.S. dollar denominated money market
instruments as disclosed in the Portfolio of Investments by security type or, in
the case of the Tax-Exempt Fund, by state of issuer. The issuers' ability to
meet their obligations may be affected by domestic and foreign economic,
regional and political developments.
The Prime Fund had the following concentrations by industry sector at November
30, 1995 (as a percentage of total investments):
<TABLE>
<CAPTION>
% OF
INDUSTRY CLASS PORTFOLIO
- -------------------------------------------- ----------
<S> <C>
Banks -- International...................... 21.7%
Financial Services.......................... 20.0
Repurchase Agreements....................... 11.3
Brokerage Services.......................... 10.6
Banks -- Regional........................... 8.6
Banks -- Money Center....................... 6.2
Financial Services -- Mortgage.............. 5.1
Automobiles................................. 4.2
U.S. Government Agency Securities........... 3.5
Financial Services -- Diversified........... 3.5
Finance Companies........................... 2.7
Utilities -- Electric....................... 1.9
Tire & Rubber............................... 0.7
-----
100.0%
-----
-----
</TABLE>
At November 30, 1995, the Tax-Exempt Fund had the following concentrations by
industry sector (as a percentage of total investments):
<TABLE>
<CAPTION>
% OF
INDUSTRY CLASS PORTFOLIO
- -------------------------------------------- ----------
<S> <C>
Health & Medical Facilities................. 16.9%
Pollution Control & Waste Management........ 13.5
Education Facilities........................ 11.7
General Obligations......................... 11.5
Miscellaneous............................... 7.1
Industrial Development Revenue.............. 6.5
Education................................... 6.3
Power Projects.............................. 6.0
Tax Revenue Anticipation Notes.............. 5.9
Public Facilities........................... 2.5
Housing Developments........................ 2.0
Water Projects.............................. 1.9
Revenue..................................... 1.5
Solid Waste................................. 1.2
Equipment Leasing........................... 1.2
Home Building and Land Development.......... 1.0
Pre-Refunded Securities..................... 1.0
Homebuilders................................ 1.0
Resource Recovery Facilities................ 0.8
Utility Projects............................ 0.5
-----
100.0%
-----
-----
</TABLE>
28
<PAGE>
EMERALD PRIME FUND
- --------------------------------------------------------------------------------
Financial Highlights
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEARS ENDED
------------------------------------------------------------------------
NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30,
1995 1994 1993 1992 1991
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
EMERALD SHARES:
NET ASSET VALUE, BEGINNING OF PERIOD............ $ 1.0000 $ 0.9999 $ 1.0001 $ 1.0000 $ 0.9999
------------ ------------ ------------ ------------ ------------
Income from investment operations:
Net investment income......................... 0.0566 0.0390 0.0316 0.0407 0.0637
Net realized gains (losses) on securities..... 0.0002 (0.0028) (0.0001) 0.0001 0.0001
------------ ------------ ------------ ------------ ------------
Total income from investment operations....... 0.0568 0.0362 0.0315 0.0408 0.0638
------------ ------------ ------------ ------------ ------------
Less dividends and distributions:
Dividends from net investment income.......... (0.0566) (0.0390) (0.0316) (0.0407) (0.0637)
Distributions from net realized gains on
securities.................................. (0.0000) (0.0000) (0.0001) (0.0000) (0.0000)
------------ ------------ ------------ ------------ ------------
Total dividends and distributions............... (0.0566) (0.0390) (0.0317) (0.0407) (0.0637)
------------ ------------ ------------ ------------ ------------
Voluntary capital contribution.................. 0.0000 0.0029 0.0000 0.0000 0.0000
------------ ------------ ------------ ------------ ------------
Net change in net asset value................... 0.0002 0.0001 (0.0002) 0.0001 0.0001
------------ ------------ ------------ ------------ ------------
NET ASSET VALUE, END OF PERIOD.................. $ 1.0002 $ 1.0000 $ 0.9999 $ 1.0001 $ 1.0000
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ ------------ ------------
Total return.................................... 5.81% 3.97% 3.21% 4.14% 6.56%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000s).............. $ 462,726 $ 413,541 $ 510,683 $1,947,016 $ 512,919
Ratio of expenses to average net assets....... 0.37% 0.37% 0.35% 0.37% 0.40%
Ratio of net investment income to average net
assets...................................... 5.66% 3.92% 3.21% 3.84% 6.27%
Ratio of expenses to average net assets*...... 0.39% (a) (a) (a) 0.42%
Ratio of net investment income to average net
assets*..................................... 5.64% (a) (a) (a) 6.25%
</TABLE>
- ---------------
* During the period, certain fees were voluntarily reduced and/or reimbursed.
If such voluntary fee reductions and/or reimbursements had not occurred, the
ratios would have been as indicated.
(a) There were no waivers or reimbursements during the period.
See Notes to Financial Statements.
29
<PAGE>
EMERALD PRIME FUND
- --------------------------------------------------------------------------------
Financial Highlights
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEARS ENDED
------------------------------------------------------------------------
NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30,
1995 1994 1993 1992 1991
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
EMERALD SERVICE SHARES:
NET ASSET VALUE, BEGINNING OF PERIOD.............. $ 1.0000 $ 0.9999 $ 1.0001 $ 1.0000 $ 0.9999
------------ ------------ ------------ ------------ ------------
Income from investment operations:
Net investment income........................... 0.0536 0.0355 0.0281 0.0371 0.0602
Net realized gains (losses) on securities....... 0.0002 (0.0028) (0.0001) 0.0001 0.0001
------------ ------------ ------------ ------------ ------------
Total income from investment operations......... 0.0538 0.0327 0.0280 0.0372 0.0603
------------ ------------ ------------ ------------ ------------
Less dividends and distributions:
Dividends from net investment income............ (0.0536) (0.0355) (0.0281) (0.0371) (0.0602)
Distributions from net realized gains on
securities.................................... (0.0000) (0.0000) (0.0001) (0.0000) (0.0000)
------------ ------------ ------------ ------------ ------------
Total dividends and distributions................. (0.0536) (0.0355) (0.0282) (0.0371) (0.0602)
------------ ------------ ------------ ------------ ------------
Voluntary capital contribution.................... 0.0000 0.0029 0.0000 0.0000 0.0000
------------ ------------ ------------ ------------ ------------
Net change in net asset value..................... 0.0002 0.0001 (0.0002) 0.0001 0.0001
------------ ------------ ------------ ------------ ------------
NET ASSET VALUE, END OF PERIOD.................... $ 1.0002 1.0000 $ 0.9999 $ 1.0001 $ 1.0000
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ ------------ ------------
Total return...................................... 5.49% 3.61% 2.85% 3.78% 6.19%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000s)................ $ 902,006 $ 833,667 $ 619,149 $ 548,622 $ 182,928
Ratio of expenses to average net assets......... 0.72% 0.72% 0.71% 0.72% 0.75%
Ratio of net investment income to average net
assets........................................ 5.31% 3.59% 2.80% 3.54% 5.63%
Ratio of expenses to average net assets*........ 0.74% (a) (a) (a) 0.77%
Ratio of net investment income to average net
assets*....................................... 5.29% (a) (a) (a) 5.61%
</TABLE>
- ---------------
* During the period, certain fees were voluntarily reduced and/or reimbursed.
If such voluntary fee reductions and/or reimbursements had not occurred, the
ratios would have been as indicated.
(a) There were no waivers or reimbursements during the period.
See Notes to Financial Statements.
30
<PAGE>
EMERALD PRIME FUND
- --------------------------------------------------------------------------------
Financial Highlights
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEARS ENDED
--------------------------------------------------------- PERIOD ENDED
NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30,
1995 1994 1993 1992 1991*
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
INVESTOR SHARES:
NET ASSET VALUE, BEGINNING OF PERIOD.............. $ 1.0000 $ 0.9999 $ 1.0001 $ 1.0000 $ 1.0000
------------ ------------ ------------ ------------ ------------
Income from investment operations:
Net investment income........................... 0.0515 0.0339 0.0266 0.0356 0.0181
Net realized gains (losses) on securities....... 0.0002 (0.0028) (0.0001) 0.0001 0.0000
------------ ------------ ------------ ------------ ------------
Total income from investment operations......... 0.0517 0.0311 0.0265 0.0357 0.0181
------------ ------------ ------------ ------------ ------------
Less dividends and distributions:
Dividends from net investment income............ (0.0515) (0.0339) (0.0266) (0.0356) (0.0181)
Distributions from net realized gains on
securities.................................... (0.0000) (0.0000) (0.0001) (0.0000) (0.0000)
------------ ------------ ------------ ------------ ------------
Total dividends and distributions................. (0.0515) (0.0339) (0.0267) (0.0356) (0.0181)
------------ ------------ ------------ ------------ ------------
Voluntary capital contribution.................... 0.0000 0.0029 0.0000 0.0000 0.0000
------------ ------------ ------------ ------------ ------------
Net change in net asset value..................... 0.0002 0.0001 (0.0002) 0.0001 0.0000
------------ ------------ ------------ ------------ ------------
NET ASSET VALUE, END OF PERIOD.................... $ 1.0002 $ 1.0000 $ 0.9999 $ 1.0001 $ 1.0000
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ ------------ ------------
Total return...................................... 5.27% 3.44% 2.70% 3.62% 1.82%++
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000s)................ $ 444,928 $ 208,714 $ 181,155 $ 96,730 $ 16,465
Ratio of expenses to average net assets......... 0.90% 0.88% 0.86% 0.87% 0.90%+
Ratio of net investment income to average net
assets........................................ 5.13% 3.40% 2.63% 3.33% 4.80%+
Ratio of expenses to average net assets**....... 0.93% (a) (a) (a) 0.91%+
Ratio of net investment income to average net
assets**...................................... 5.10% (a) (a) (a) 4.79%+
</TABLE>
- ---------------
* For the period July 29, 1991 (initial offering date) through November 30,
1991.
** During the period, certain fees were voluntarily reduced and/or reimbursed.
If such voluntary fee reductions and/or reimbursements had not occurred, the
ratios would have been as indicated.
+ Annualized
++ Unannualized
(a) There were no waivers or reimbursements during the period.
See Notes to Financial Statements.
31
<PAGE>
EMERALD TREASURY FUND
- --------------------------------------------------------------------------------
Financial Highlights
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEARS ENDED
------------------------------------------------------------------------
NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30,
1995 1994 1993 1992 1991
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
EMERALD SHARES:
NET ASSET VALUE, BEGINNING OF PERIOD.............. $ 0.9999 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
------------ ------------ ------------ ------------ ------------
Income from investment operations:
Net investment income........................... 0.0548 0.0368 0.0291 0.0368 0.0590
Net realized gains (losses) on securities....... (0.0003) (0.0001) 0.0000 0.0000 0.0000
------------ ------------ ------------ ------------ ------------
Total income from investment operations......... 0.0545 0.0367 0.0291 0.0368 0.0590
------------ ------------ ------------ ------------ ------------
Less dividends and distributions:
Dividends from net investment income............ (0.0548) (0.0368) (0.0291) (0.0368) (0.0590)
------------ ------------ ------------ ------------ ------------
Net change in net asset value................... (0.0003) (0.0001) 0.0000 0.0000 0.0000
------------ ------------ ------------ ------------ ------------
NET ASSET VALUE, END OF PERIOD.................... $ 0.9996 $ 0.9999 $ 1.0000 $ 1.0000 $ 1.0000
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ ------------ ------------
Total return...................................... 5.62% 3.74% 2.95% 3.75% 6.07%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000s)................ $ 236,392 $ 283,920 $ 501,377 $ 452,170 $ 575,103
Ratio of expenses to average net assets......... 0.40% 0.39% 0.40% 0.38% 0.40%
Ratio of net investment income to average net
assets........................................ 5.49% 3.73% 2.91% 3.74% 5.86%
Ratio of expenses to average net assets*........ 0.42% (a) (a) (a) 0.41%
Ratio of net investment income to average net
assets*....................................... 5.46% (a) (a) (a) 5.85%
</TABLE>
- ---------------
* During the period, certain fees were voluntarily reduced and/or reimbursed.
If such voluntary fee reductions and/or reimbursements had not occurred, the
ratios would have been as indicated.
(a) There were no waivers or reimbursements during the period.
See Notes to Financial Statements.
32
<PAGE>
EMERALD TREASURY FUND
- --------------------------------------------------------------------------------
Financial Highlights
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEARS ENDED
------------------------------------------------------------------------
NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30,
1995 1994 1993 1992 1991
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
EMERALD SERVICE SHARES:
NET ASSET VALUE, BEGINNING OF PERIOD.............. $ 0.9999 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
------------ ------------ ------------ ------------ ------------
Income from investment operations:
Net investment income........................... 0.0513 0.0331 0.0256 0.0333 0.0555
Net realized losses on securities............... (0.0003) (0.0001) 0.0000 0.0000 0.0000
------------ ------------ ------------ ------------ ------------
Total income from investment operations......... 0.0510 0.0330 0.0256 0.0333 0.0555
------------ ------------ ------------ ------------ ------------
Dividends from net investment income............ (0.0513) (0.0331) (0.0256) (0.0333) (0.0555)
------------ ------------ ------------ ------------ ------------
Net change in net asset value................... (0.0003) (0.0001) 0.0000 0.0000 0.0000
------------ ------------ ------------ ------------ ------------
Net asset value, end of period.................... $ 0.9996 $ 0.9999 $ 1.0000 $ 1.0000 $ 1.0000
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ ------------ ------------
Total return...................................... 5.25% 3.36% 2.59% 3.39% 5.70%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000s)................ $ 525,609 $ 591,991 $ 403,809 $ 372,691 $ 219,912
Ratio of expenses to average net assets......... 0.75% 0.74% 0.75% 0.73% 0.75%
Ratio of net investment income to average net
assets........................................ 5.13% 3.38% 2.56% 3.30% 5.09%
Ratio of expenses to average net assets*........ 0.77% (a) (a) (a) 0.76%
Ratio of net investment income to average net
assets*....................................... 5.11% (a) (a) (a) 5.08%
</TABLE>
- ---------------
* During the period, certain fees were voluntarily reduced and/or reimbursed.
If such voluntary fee reductions and/or reimbursements had not occurred, the
ratios would have been as indicated.
(a) There were no waivers or reimbursements during the period.
See Notes to Financial Statements.
33
<PAGE>
EMERALD TREASURY FUND
- --------------------------------------------------------------------------------
Financial Highlights
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEARS ENDED
------------------------------------------------------------------------
NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30,
1995 1994 1993 1992 1991*
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
INVESTOR SHARES:
NET ASSET VALUE, BEGINNING OF PERIOD........... $ 0.9999 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
------------ ------------ ------------ ------------ ------------
Income from investment operations:
Net investment income........................ 0.0498 0.0316 0.0241 0.0318 0.0162
Net realized losses on securities............ (0.0003) (0.0001) 0.0000 0.0000 0.0000
------------ ------------ ------------ ------------ ------------
Total income from investment operations...... 0.0495 0.0315 0.0241 0.0318 0.0162
------------ ------------ ------------ ------------ ------------
Dividends from net investment income......... (0.0498) (0.0316) (0.0241) (0.0318) (0.0162)
------------ ------------ ------------ ------------ ------------
Net change in net asset value................ (0.0003) (0.0001) 0.0000 0.0000 0.0000
------------ ------------ ------------ ------------ ------------
NET ASSET VALUE, END OF PERIOD................. $ 0.9996 $ 0.9999 $ 1.0000 $ 1.0000 $ 1.0000
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ ------------ ------------
Total return................................... 5.10% 3.21% 2.44% 3.23% 1.63%++
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000s)............. $ 49,047 $ 32,444 $ 21,362 $ 3,762 $ 1,099
Ratio of expenses to average net assets...... 0.90% 0.90% 0.90% 0.88% 0.90%+
Ratio of net investment income to average net
assets..................................... 4.98% 3.13% 2.42% 3.12% 4.34%+
Ratio of expenses to average net assets**.... 1.04% 1.00% (a) (a) 0.91%+
Ratio of net investment income to average net
assets**................................... 4.84% 3.03% (a) (a) 4.33%+
</TABLE>
- ---------------
* For the period July 29, 1991 (initial offering date) through November 30,
1991.
** During the period, certain fees were voluntarily reduced and/or reimbursed.
If such voluntary fee reductions and/or reimbursements had not occurred, the
ratios would have been as indicated.
+ Annualized.
++ Unannualized.
(a) There were no waivers or reimbursements during the period.
See Notes to Financial Statements.
34
<PAGE>
EMERALD TAX-EXEMPT FUND
- --------------------------------------------------------------------------------
Financial Highlights
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEARS ENDED
------------------------------------------------------------------------
NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30,
1995 1994 1993 1992** 1991
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
EMERALD SHARES:
NET ASSET VALUE, BEGINNING OF PERIOD.............. $ 0.9999 $ 0.9999 $ 0.9998 $ 0.9998 $ 0.9997
------------ ------------ ------------ ------------ ------------
Income from investment operations:
Net investment income........................... 0.0355 0.0242 0.0214 0.0290 0.0446
Net realized and unrealized gains (losses) on
securities.................................... (0.0003) 0.0000 0.0001 0.0000 0.0001
------------ ------------ ------------ ------------ ------------
Total income from investment operations......... 0.0352 0.0242 0.0215 0.0290 0.0447
------------ ------------ ------------ ------------ ------------
Dividends from net investment income............ (0.0355) (0.0242) (0.0214) (0.0290) (0.0446)
------------ ------------ ------------ ------------ ------------
Net change in net asset value................... (0.0003) 0.0000 0.0001 0.0000 0.0001
------------ ------------ ------------ ------------ ------------
NET ASSET VALUE, END OF PERIOD.................... $ 0.9996 $ 0.9999 $ 0.9999 $ 0.9998 $ 0.9998
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ ------------ ------------
Total return...................................... 3.61% 2.45% 2.16% 2.94% 4.55%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000s)................ $ 156,353 $ 162,856 $ 147,525 $ 158,692 $ 122,151
Ratio of expenses to average net assets......... 0.40% 0.40% 0.40% 0.40% 0.39%
Ratio of net investment income to average net
assets........................................ 3.53% 2.42% 2.13% 2.88% 4.46%
Ratio of expenses to average net assets*........ 0.52% 0.46% 0.56% 0.57% 0.54%
Ratio of net investment income to average net
assets*....................................... 3.41% 2.36% 1.97% 2.71% 4.31%
</TABLE>
- ---------------
* During the period, certain fees were voluntarily reduced and/or reimbursed.
If such voluntary fee reductions and/or reimbursements had not occurred, the
ratios would have been as indicated.
** Effective April 22, 1992, Rodney Square Management Corporation, a subsidiary
of Wilmington Trust Company, became the Fund's investment Sub-Adviser.
See Notes to Financial Statements.
35
<PAGE>
EMERALD TAX-EXEMPT FUND
- --------------------------------------------------------------------------------
Financial Highlights
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEARS ENDED
------------------------------------------------------------------------
NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30,
1995 1994 1993 1992** 1991
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
EMERALD SERVICE SHARES:
NET ASSET VALUE, BEGINNING OF PERIOD.............. $ 0.9999 $ 0.9999 $ 0.9998 $ 0.9998 $ 0.9997
------------ ------------ ------------ ------------ ------------
Income from investment operations:
Net investment income........................... 0.0319 0.0206 0.0179 0.0255 0.0411
Net realized and unrealized gains (losses) on
securities.................................... (0.0003) 0.0000 0.0001 0.0000 0.0001
------------ ------------ ------------ ------------ ------------
Total income from investment operations......... 0.0316 0.0206 0.0180 0.0255 0.0412
------------ ------------ ------------ ------------ ------------
Dividends from net investment income............ (0.0319) (0.0206) (0.0179) (0.0255) (0.0411)
------------ ------------ ------------ ------------ ------------
Net change in net asset value................... (0.0003) 0.0000 0.0001 0.0000 0.0001
------------ ------------ ------------ ------------ ------------
NET ASSET VALUE, END OF PERIOD.................... $ 0.9996 $ 0.9999 $ 0.9999 $ 0.9998 $ 0.9998
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ ------------ ------------
Total return...................................... 3.24% 2.08% 1.80% 2.58% 4.19%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000s)................ $ 2,855 $ 4,028 $ 487 $ 111 $ 11
Ratio of expenses to average net assets......... 0.75% 0.75% 0.75% 0.75% 0.75%
Ratio of net investment income to average net
assets........................................ 3.19% 2.17% 1.75% 2.65% 5.08%
Ratio of expenses to average net assets*........ 1.20% 1.59% 0.92% 0.92% 0.91%
Ratio of net investment income to average net
assets*....................................... 2.74% 1.33% 1.58% 2.48% 4.92%
</TABLE>
- ---------------
* During the period, certain fees were voluntarily reduced and/or reimbursed.
If such voluntary fee reductions and/or reimbursements had not occurred, the
ratios would have been as indicated.
** Effective April 22, 1992, Rodney Square Management Corporation, a subsidiary
of Wilmington Trust Company, became the Fund's investment Sub-Adviser.
See Notes to Financial Statements.
36
<PAGE>
EMERALD TAX-EXEMPT FUND
- --------------------------------------------------------------------------------
Financial Highlights
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEARS ENDED
------------------------------------------------------------------------
NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30,
1995 1994 1993 1992*** 1991*
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
INVESTOR SHARES:
NET ASSET VALUE, BEGINNING OF PERIOD........... $ 0.9999 $ 0.9999 $ 0.9998 $ 0.9998 $ 0.9998
------------ ------------ ------------ ------------ ------------
Income from investment operations:
Net investment income........................ 0.0305 0.0192 0.0164 0.0240 0.0126
Net realized and unrealized gains (losses) on
securities................................. (0.0003) 0.0000 0.0001 0.0000 0.0000
------------ ------------ ------------ ------------ ------------
Total income from investment operations...... 0.0302 0.0192 0.0165 0.0240 0.0126
------------ ------------ ------------ ------------ ------------
Dividends from net investment income......... (0.0305) (0.0192) (0.0164) (0.0240) (0.0126)
------------ ------------ ------------ ------------ ------------
Net change in net asset value................ (0.0003) 0.0000 0.0001 0.0000 0.0000
------------ ------------ ------------ ------------ ------------
NET ASSET VALUE, END OF PERIOD................. $ 0.9996 $ 0.9999 $ 0.9999 $ 0.9998 $ 0.9998
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ ------------ ------------
Total return................................... 3.09% 1.94% 1.65% 2.43% 0.96%++
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000s)............. $ 38,243 $ 38,123 $ 45,609 $ 16,477 $ 1,155
Ratio of expenses to average net assets...... 0.90% 0.90% 0.90% 0.90% 0.87%+
Ratio of net investment income to average net
assets..................................... 3.04% 1.90% 1.62% 2.21% 3.42%+
Ratio of expenses to average net assets**.... 1.15% 1.02% 1.06% 1.07% 0.97%+
Ratio of net investment income to average net
assets**................................... 2.79% 1.78% 1.46% 2.04% 3.32%+
</TABLE>
- ---------------
* For the period July 29, 1991 (initial offering date) through November 30,
1991.
** During the period, certain fees were voluntarily reduced and/or reimbursed.
If such voluntary fee reductions and/or reimbursements had not occurred, the
ratios would have been as indicated.
*** Effective April 22, 1992, Rodney Square Management Corporation, a subsidiary
of Wilmington Trust Company, became the Fund's investment Sub-Adviser.
+ Annualized
++ Unannualized
See Notes to Financial Statements.
37
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees
and Shareholders of
Emerald Funds
In our opinion, the accompanying statements of assets and liabilities, including
the portfolios of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of Emerald Prime Fund, Emerald
Treasury Fund and Emerald Tax-Exempt Fund (three of the portfolios constituting
the Emerald Funds, hereafter referred to as the "Funds") at November 30, 1995,
the results of each of their operations for the year then ended, the changes in
each of their net assets for each of the two years in the period then ended and
the financial highlights for each of the periods presented, in conformity with
generally accepted accounting principles. These financial statements and
financial highlights (hereafter referred to as "financial statements") are the
responsibility of the Funds' management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with generally accepted
auditing standards which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities at November 30, 1995 by
correspondence with the custodians and brokers and the application of
alternative auditing procedures where confirmations from brokers were not
received, provide a reasonable basis for the opinion expressed above.
PRICE WATERHOUSE LLP
New York, New York
January 24, 1996
FEDERAL INCOME TAX STATUS OF DIVIDENDS
(UNAUDITED)
Emerald Prime Fund and Emerald Treasury Fund have determined that all
dividends and distributions paid during the fiscal year ended November 30, 1995,
were paid from net investment income and are subject to Federal income tax.
Emerald Tax-Exempt Fund has determined that all dividends and distributions
paid during the fiscal year ended November 30, 1995, were paid from net
investment income and are exempt from Federal income tax. Additionally, a
portion of the income dividends were paid from income derived from securities
subject to the Alternative Minimum Tax.
38
<PAGE>
EMMMAN95
