<PAGE>
AMSOUTH MUTUAL FUNDS
====================
[LOGO of AMSOUTH]
AMSOUTH BANK
Investment Advisor
A N N U A L
R E P O R T
JULY 31, 1997
[LOGO of AMSOUTH
MUTUAL FUNDS]
BISYS Fund Services, Distributor
Not FDIC Insured
<PAGE>
TABLE OF CONTENTS
MESSAGE FROM THE CHAIRMAN AND INVESTMENT ADVISOR
PAGE 1
REPORT OF INDEPENDENT ACCOUNTANTS
PAGE 23
STATEMENTS OF ASSETS AND LIABILITIES
PAGE 24
STATEMENTS OF OPERATIONS
PAGE 27
STATEMENTS OF CHANGES IN NET ASSETS
PAGE 30
SCHEDULES OF PORTFOLIO INVESTMENTS
PAGE 34
NOTES TO FINANCIAL STATEMENTS
PAGE 65
FINANCIAL HIGHLIGHTS
PAGE 74
THE AMSOUTH MUTUAL FUNDS, LIKE ALL MUTUAL FUNDS, ARE
NOT FDIC INSURED OR INSURED BY ANY OTHER AGENCY AND
ARE NOT OBLIGATIONS OR DEPOSITS OF, OR ENDORSED OR
GUARANTEED BY, AMSOUTH BANK OR ANY OF ITS
AFFILIATES. INVESTMENT PRODUCTS INVOLVE INVESTMENT
RISK, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
<PAGE>
MESSAGE FROM THE CHAIRMAN AND INVESTMENT ADVISOR
Dear Shareholders:
We are pleased to send you this annual report for the AmSouth Mutual Funds.
The 12-month period ended July 31, 1997, was a rewarding period for investors
in both the equity and fixed-income markets. Stock investors who participated
for the full year saw their holdings rise in value significantly; two
performance benchmarks, the Dow Jones Industrial Average and the Standard &
Poor's 500 Index, were up 48.72% and 52.12%, respectively. Bond investors also
realized satisfactory gains, especially when one considers that "real returns"
(returns minus the very modest rate of inflation) were high by historical
standards.
A YEAR OF CHANGE
This last year also was a dynamic time for our family of funds. We would like
to share with you a number of important milestones:
FEBRUARY: We completed a $9 million common trust fund conversion from the
bank's equity portfolio to our Equity Fund.
MARCH: Our new Equity Income Fund was introduced, and AmSouth Bank immediately
assumed responsibility as custodian. The fund, subadvised by Rockhaven Asset
Management, is designed to take advantage of growth opportunities in the stock
market, while resolutely managing risk. Rockhaven's president and chief
investment officer, Christopher Wiles, has an excellent long-term track
record.
APRIL: AmSouth assumed responsibility as custodian for the remaining funds.
MAY: Dorothy Thomas, who has managed major portfolios of tax-free bonds since
1983, took over the management of the AmSouth Florida Tax-Free Fund.
JUNE: We completed another, larger common trust fund conversion, converting
$984 million from the bank's portfolios to three of our existing mutual funds:
Bond Fund, Limited Maturity Fund and Equity Fund. The conversion will help
launch the retail share class of the Municipal Bond Fund and raise combined
fund family assets to $3.2 billion. One benefit to you as shareholders is that
a larger fund complex may provide economies of scale that can help reduce
annual expenses--savings that could be reflected in nominally higher future
returns. In a separate action, the bank shortened its name from AmSouth Bank
of Alabama to simply "AmSouth Bank."
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JULY: As a result of the June common trust fund conversion, Ms. Thomas added
the AmSouth Municipal Bond Fund to her management portfolio.
AUGUST: We introduced a new fund, the AmSouth Capital Growth Fund. The Fund is
subadvised by Peachtree Asset Management, a division of Smith Barney. Dennis
Johnson, president and chief investment officer, is in charge of the Fund's
day-to-day decision making and has a long record of managing growth
portfolios.
SEPTEMBER: We will expand our share-class offerings to three separate classes:
Premier Shares (for trust accounts), Classic Shares (Retail Class A) and Class
B Shares (Retail Class B). This move will give shareholders more flexibility
when choosing the type of charge-and-expense arrangement most appropriate to
their investment needs.
STOCKS AND BONDS: A POSITIVE LONG-TERM OUTLOOK
In the following pages, you will find the Schedules of Portfolio Investments
for the AmSouth Mutual Funds, along with a report for each of the Funds for
the 12 months ended July 31, 1997. This information will give you a complete
perspective on how your fund (or funds) performed, along with our portfolio
managers' outlook for the next six to 12 months.
Overall, we feel that the long-term outlook for both stocks and bonds remains
positive. As we write this letter in the middle of August, the Federal Reserve
has again decided to leave interest rates unchanged; the Producer Price
Index/1/ has fallen for the seventh month in a row (a post-World War II
record); and the economy continues to grow at a pace that, while quite
respectable, does not give indications of imminent inflationary pressures.
This environment is very hospitable to both equities and fixed-income
investments.
At the same time, short-term volatility continues to make its presence felt.
On August 6, 1997, for example, the Dow peaked at an all-time high of 8259.
Over the following nine days, it plunged 564 points. Then it reversed course
again and streaked higher. At the same time, the bond market was anything but
tranquil, rising and falling nearly as dramatically over a three-week period
in late July and early August.
/1/Producer Price Index measures changes in the average prices of goods
received by producers of commodities and all stages of processing, in
primary or wholesale markets. It measures the change in prices paid by
businesses rather than by consumers.
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The lesson to be learned from this somewhat frenzied activity, against the
backdrop of the markets' strong, long-term performance is this: Investors who
formulate prudent strategies and stick to their plans throughout the markets'
ups-and-downs have the potential to realize the greatest possible gains from
the opportunities stocks and bonds afford them.
And this is our mission: To help you manage your investments and achieve your
goals as effectively as possible. We thank you for your continued trust.
Sincerely,
/s/ George Landreth
George Landreth AmSouth Bank
Chairman Investment Advisor
AmSouth Mutual Funds
For more complete information on any of the AmSouth Mutual Funds, including
charges and expenses, call 1-800-451-8382 for a prospectus, which you should
read carefully before you invest or send money. Shares are distributed by
BISYS Fund Services.
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THE AMSOUTH REGIONAL EQUITY FUND
Regional Equity Fund++
Value of a $10,000 Investment
<TABLE>
<CAPTION>
AmSouth Regional Lipper Capital
Equity Fund* S&P 500 Index Appreciation Index
<S> <C> <C> <C>
12/1/88 9,551 10,000 10,000
7/89 11,250 12,920 12,919
7/90 12,309 13,755 13,328
7/91 13,850 15,512 14,988
7/92 16,712 17,492 16,592
7/93 19,307 19,009 19,096
7/94 20,249 19,995 19,796
7/95 23,306 25,205 25,244
7/96 26,360 29,378 27,377
7/97 36,646 44,689 36,419
</TABLE>
Average Annual Total Return*
<TABLE>
<CAPTION>
Since
Inception
1 Year 5 Year (12/1/88)
<S> <C> <C> <C>
7/31/97 32.75% 15.93% 16.16%
</TABLE>
The performance of the AmSouth Regional Equity Fund is measured against the S&P
500 Index and the Lipper Capital Appreciation Index. The S&P 500 Index is an
unmanaged index generally representative of the U.S. stock market. The index
does not reflect the deduction of expenses associated with a mutual fund, such
as investment management and fund accounting fees. However, the Lipper Capital
Appreciation Index, a managed index, and the Fund's performance do reflect the
deduction of fees for these value-added services. During the period shown, the
Fund waived fees for various expenses. Had these waivers not been in place,
performance quoted would have been lower. Past performance is not predictive of
future results. The investment return and NAV will fluctuate, so that an
investor's shares, when redeemed, may be worth more or less that the original
cost.
* Reflects 4.50% sales charge.
The AmSouth Regional Equity Fund is managed by Pedro Verdu, CFA. Mr. Verdu has
more than 25 years of investment experience as an analyst and portfolio
manager. He holds an MBA in finance and a bachelor's degree in economics.
SOLID RETURNS, DESPITE LIMITING FACTORS
For the 12 months ended July 31, 1997, the AmSouth Regional Equity Fund
produced a total return of 39.02% (without the sales charge).+ In comparison,
the S&P 500 Index rose 52.12%, and the Lipper Capital Appreciation Index/1/
moved up 33.26%.
A number of factors restrained the Fund's total return, relative to the
performance of the S&P 500. First, most of the sectors that led the stock
market over the last 12 months--especially technology--are not widely available
in the Southeast. Second, the broader market was led by larger capitalization
stocks, which far outperformed medium- and small-cap equities. Our Fund,
because it invests in companies that are regional--rather than national or
international--in scope has a small- to medium-cap focus.
Nonetheless, while we trailed the S&P 500 somewhat, we were happy with our
overall performance. Longer term, this has been the best-performing fund in our
fund family.
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HEALTH CARE AND FINANCIAL SERVICES WERE WINNING SECTORS
Our investments in the health-care and financial services sectors worked well
for us. The four health-care stocks we have--Healthsouth Corp. (7.1% of net
assets),* Health Management Associates (3.2%), Coventry Corp. (2.8%) and
Medpartners/Mullikin, Inc. (2.4%)--all helped our performance. In financial
services, NationsBank (2.3%) did very well, as did First Union (2.4%). While
both banks are dominant players in the Southeast, they've also made smart
acquisitions outside the region. The two companies also are in the process of
diversifying out of traditional banking lines--buying interests in areas such
as brokerage and mutual fund management.
Another interesting holding of ours is Scientific Atlanta (2.5%), which makes
various types of communication hardware, mostly for the cable and wireless
industries. We're very positive on the company, and it's one of the few
equities in the Southeast you can actually call a technology stock.
As of July 31, 1997, the Fund's top five holdings were Healthsouth Corp. (7.1%
of net assets), Health Management Associates (3.2%), Stein Mart, Inc. (2.9%),
Coventry Corp. (2.8%) and Federal Express Corp. (2.6%).*
REGIONAL GROWTH: FAST AND FASTER
We believe that during the next six months, the Southeast economy will grow
roughly one percent faster than the national economy as a whole. Beyond that,
we see the region's economy picking up even more steam, growing at a rate
perhaps one-and-a-half percent faster than the U.S. economy. The only cloud on
the horizon could be that the regional labor market is pretty tight; there
isn't a large labor pool from which to draw. However, the South still is
seeing good migration from other parts of the country, and this should help
mitigate any potential problems.
+ The Fund's total return with a maximum 4.50% sales charge was 32.75% for the
period.
++ Regional Funds may be subject to additional risk, since the companies are
located in one geographical location.
* The composition of the Fund's holdings is subject to change.
/1/The Lipper Capital Appreciation Index is comprised of managed funds that
aim at maximum capital appreciation, frequently by means of 100% or more
portfolio turnover, leveraging, purchasing unregistered securities,
purchasing options, etc. The index may reflect large cash positions.
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THE AMSOUTH EQUITY FUND
Equity Fund
Value of a $10,000 Investment
<TABLE>
<CAPTION>
AmSouth Lipper Capital
Equity Fund* S&P 500 Index Appreciation Index
<S> <C> <C> <C>
12/1/88 9,551 10,000 10,000
7/89 11,849 12,980 12,919
7/90 12,046 13,822 13,328
7/91 13,065 15,577 14,988
7/92 14,757 17,555 16,592
7/93 16,794 19,084 19,096
7/94 18,121 20,069 19,796
7/95 21,613 25,307 25,244
7/96 24,010 29,378 27,377
7/97 34,178 44,689 36,419
</TABLE>
Average Annual Total Return*
<TABLE>
<CAPTION>
Since
Inception
1 Year 5 Year (12/1/88)
<S> <C> <C> <C>
7/31/97 35.95% 17.21% 15.23%
</TABLE>
The performance of the AmSouth Equity Fund is measured against the S&P
500 Index and the Lipper Capital Appreciation Index. The S&P 500 Index is an
unmanaged index generally representative of the U.S. stock market. The index
does not reflect the deduction of expenses associated with a mutual fund, such
as investment management and fund accounting fees. However, the Lipper Capital
Appreciation Index, a managed index, and the Fund's performance do reflect the
deduction of fees for these value-added services. During the period shown, the
Fund waived fees for various expenses. Had these waivers not been in place,
performance quoted would have been lower. Past performance is not predictive of
future results. The investment return and NAV will fluctuate, so that an
investor's shares, when redeemed, may be worth more or less that the original
cost.
* Reflects 4.50% sales charge.
The AmSouth Equity Fund is managed by Pedro Verdu, CFA. Mr. Verdu has more than
25 years of investment experience as an analyst and portfolio manager. He holds
an MBA in finance and a bachelor's degree in economics.
BIG RETURNS, LOTS OF VOLATILITY
For the 12 months ended July 31, 1997, the AmSouth Equity Fund produced a total
return of 42.35% (without the sales charge).+ In comparison, the S&P 500 Index
rose 52.12%, and the Lipper Capital Appreciation Index/1/ moved up 33.26%.
While remarkable for its continued upward surge, the market experienced
striking volatility--most notably a nearly 10% decline in March and April, and
a subsequent, explosive recovery.
FINANCIAL SERVICES AND RETAIL STOCKS PROPELLED THE FUND
The financial services sector performed very well and continues to do so. We
had an above-market weighting in that sector for much of the year and that
helped our performance quite a bit. Among financial stocks that did well for us
was Great Western (3.3% of net assets as of June 30, 1997),* which we owned
when it became part of a takeover battle between Washington Mutual and
Ahmanson.
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<PAGE>
The retail sector also ran ahead of the market and helped the Fund. We had a
weighting in that sector that was two to two-and-a-half times the market's
retail weighting. This represented a significant overweighting we made on
retail equities, starting in the second quarter of 1996. One stock that did
well for us was Wal-Mart (3.0%). We thought it was significantly undervalued
when the price was in the low 20s, so we bought it, and the stock is now
selling in the high 30s. We also made some very good money with CVS (2.5%),
the drugstore chain, which is leading a consolidation in the drugstore
industry.
As of July 31, 1997, the Fund's top five holdings were Wal-Mart Stores Inc.
(3.0% of net assets), Weyerhauser Co. (2.9%), AMP (2.8%), Sun Company, Inc.
(2.8%) and St. Paul Companies, Inc. (2.6%).*
TAKING PROFITS AND REINVESTING THEM
Recently, we've started to take some profits in the financial services area
and to move some of the money toward selected stocks in the consumer non-
durables area. For instance, we recently added a position in Rubbermaid
(1.8%). Over and above liking the stock's valuation characteristics, what we
found is a company that has a recognizable and valuable consumer franchise--a
good brand name and goodwill among its customers. On a short-term basis,
Rubbermaid suffered from skyrocketing costs for its single largest raw
material, plastic resins. Also, after many successful years, the company had
lacked strong management initiative. We think both problems are coming to an
end and that the stock has good upside potential.
OUR OUTLOOK IS FAIRLY CONSTRAINED
Over the last year and a half, we've had the greatest 18-month return ever for
the S&P 500 and its predecessor index, going back to 1927. Calculating price-
to-book, price-to-earnings, yield and other traditional valuation measures, we
come up with a market that certainly is fully valued at this time.
Historically, investors tend to talk about a "margin of safety" that can
provide some measure of protection against disappointments. We think that the
margin is very thin right now. That doesn't mean stocks can't go higher, but
we think there is very little room for error at this point.
+ The Fund's total return with a maximum 4.50% sales charge was 35.95% for the
period.
* The composition of the Fund's holdings is subject to change.
/1/ The Lipper Capital Appreciation Index is comprised of managed funds that aim
at maximum capital appreciation, frequently by means of 100% or more
portfolio turnover, leveraging, purchasing unregistered securities,
purchasing options, etc. The index may reflect large cash positions.
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<PAGE>
THE AMSOUTH EQUITY INCOME FUND
Equity Income Fund
Value of a $10,000 Investment
<TABLE>
<CAPTION>
AmSouth Equity Lipper Equity
Income Fund* S&P 500 Index Income Fund Index
<S> <C> <C> <C>
3/20/97 9,551 10,000 10,000
3/97 9,390 9,574 9,676
4/97 9,719 10,133 9,964
5/97 10,275 10,730 10,538
6/97 10,592 11,192 10,935
7/97 11,252 12,067 11,594
</TABLE>
Average Annual Total Return*
<TABLE>
<CAPTION>
Since
Inception
YTD (3/20/97)
<S> <C> <C>
7/31/97 12.52% 12.52%
</TABLE>
The performance of the AmSouth Equity Income Fund is measured against the S&P
500 Index and the Lipper Equity Income Fund Index. The S&P 500 Index is an
unmanaged index generally representative of the U.S. stock market. The index
does not reflect the deduction of expenses associated with a mutual fund, such
as investment management and fund accounting fees. However, the Lipper Equity
Income Fund Index, a managed index, and the Fund's performance do reflect the
deduction of fees for these value-added services. During the period shown, the
Fund waived fees for various expenses. Had these waivers not been in place,
performance quoted would have been lower. Past performance is not predictive of
future results. The investment return and NAV will fluctuate, so that an
investor's shares, when redeemed, may be worth more or less that the original
cost.
* Reflects 4.50% sales charge.
The AmSouth Equity Income Fund is managed by Christopher Wiles, CFA. Mr. Wiles
has more than 13 years of investment management experience. He holds an MBA and
a bachelor's degree in finance.
A VERY GOOD START
The AmSouth Equity Income Fund was opened to investors on March 20, 1997. For
the period ended July 31, 1997, which represented just over four months of
performance, the Fund produced a total return of 17.81% (without the sales
charge).+ In comparison, the S&P 500 Index rose 22.72%, and the Lipper Equity
Income Fund Index/1/ moved up 17.07%. The Fund was ahead of many of its peers
in the Lipper Equity Income Fund group. Although the Fund's performance trailed
the S&P 500 slightly--we are still pleased with its overall performance--our
equity income management style has done very well in this market.
ATTRACTIVE STOCKS CAN BE FOUND IN MANY SECTORS
One stock we especially like is Allegheny Teledyne (1.6% of net assets).* The
company produces specialty steels--high-end alloys, stainless steel, titanium--
that are used in the aerospace and defense industries. They have a strong niche
in their industry. Management has a great record of allocating capital and
being very shareholder-oriented and also owns more than 30% of the company's
stock.
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<PAGE>
Another favorite investment is a convertible bond, issued by Diamond Offshore
(1.6%), which provides equipment such as semi-submersible rigs to offshore
drilling and exploration companies. The day rates for such equipment have
risen sharply, as the drilling industry has been emerging from a true
depression. Also, a stock we like in the technology sector is Pitney Bowes
(2.7%). While not always thought of as a mainstream technology company, Pitney
Bowes dominates the market in postage meters and postage systems; they have
90% of the market share in their industry. They also have a history of solid
earnings and dividend growth.
As of July 31, 1997, the Fund's top five holdings were Banc One (3.3% of net
assets), National Australian Bank (3.2%), American Home Products (2.9%),
Sprint Corp. (2.8%) and Pitney Bowes, Inc. (2.7%).*
FORECAST: POTENTIAL FAVORABLE CONDITIONS
In the stock market, it's impossible to forecast the future; that's like
forecasting the weather. Since we are seven years into a bull market--by all
historical valuation measures, a market downturn is a distinct possibility.
While past performance cannot predict future results, equity income funds have
in the past fared better than more aggressive equity funds and may prove an
important investment tool in today's difficult and uncertain market
conditions.
+ The Fund's total return with a maximum 4.50% sales charge was 12.52% since
inception.
* The composition of the Fund's holdings is subject to change.
/1/ The Lipper Equity Income Fund Index is comprised of managed funds that seek
relatively high current income and growth of income through investing 60% or
more of the portfolio in equities.
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<PAGE>
THE AMSOUTH BALANCED FUND
Balanced Fund
Value of a $10,000 Investment
<TABLE>
<CAPTION>
Lehman Brothers
AmSouth Government/Corporate Lipper Balanced
Balanced Fund* S&P 500 Index Bond Index Fund Index
<S> <C> <C> <C> <C>
12/19/91 9,551 10,000 10,000 10,000
7/92 10,861 10,337 10,866 11,117
7/93 12,106 11,233 12,065 12,400
7/94 12,727 11,816 12,050 12,731
7/95 14,670 14,895 13,269 14,685
7/96 15,897 17,361 13,974 16,087
7/97 20,097 26,409 15,482 21,023
</TABLE>
Average Annual Total Return*
<TABLE>
<CAPTION>
Since
Inception
1 Year 5 Year (12/19/91)
<S> <C> <C> <C>
7/31/97 20.77% 12.07% 13.22%
</TABLE>
The performance of the AmSouth Balanced Fund is measured against the S&P 500
Index, an unmanaged index generally representative of the U.S. stock market, the
Lehman Brothers Government/Corporate Bond Index, an unmanaged broad-based index
representative of the total return of long-term government and corporate bonds,
and the Lipper Balanced Fund Index. The S&P 500 Index and the Lehman Brothers
Government/Corporate Bond Index. The indices do not reflect the deduction of
expenses associated with a mutual fund, such as investment management and fund
accounting fees. However, the Lipper Balanced Fund Index, a managed index, and
the Fund's performance do reflect the deduction of fees for these value-added
services. During the period shown, the Fund waived fees for various expenses.
Had these waivers not been in place, performance quoted would have been lower.
Past performance is not predictive of future results. The investment return and
NAV will fluctuate, so that an investor's shares, when redeemed, may be worth
more or less than the original cost.
* Reflects 4.50% sales charge.
The AmSouth Balanced Fund is managed by Pedro Verdu, CFA. Mr. Verdu has more
than 25 years of investment experience as an analyst and portfolio manager. He
holds an MBA in finance and a bachelor's degree in economics.
EQUITY PERFORMANCE FUELS SOLID RETURN
For the 12 months ended July 31, 1997, the AmSouth Balanced Fund produced a
total return of 26.42% (without the sales charge).+ In comparison, the S&P 500
Index rose 52.12%, while the Lehman Brothers Government/Corporate Bond Index
rose 10.79%. For the same period, the Lipper Balanced Fund Index/1/ gained
29.47%. To no one's surprise, most of the Fund's gain came from its equity
holdings. Any time the stock market's return approaches 20% for a year, it's
extremely unlikely that bonds will be able to keep up. Still, bonds did perform
modestly well, and they provided a certain stability that we think, looking
forward, could be important for shareholders.
50/50 ASSET ALLOCATION
We regularly change the allocation between our equity and fixed-income holdings
to reflect what we think is the best risk/reward relationship between the stock
and bond markets. As of July 31, we had roughly a 50/50 mixture of
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<PAGE>
stocks and bonds, which was our allocation for most of the prior 12 months.
Overall, this ratio served the Fund well. The equity portion continued to
perform well, mirroring the overall stock market's sustained rise. And with a
longer-than-average maturity in our bond portfolio, we benefited from a
significant decline in interest rates this spring.
STOCKS: HIGHER AND HIGHER
The stock market turned in another strong 12-month performance, and the equity
portion of our Fund participated in the advance. The financial services
sector, in particular, contributed to the Fund's equity gains. As of July 31,
1997, the Fund's top five equity holdings were AMP, Inc. (2.0% of net assets),
Sun Company, Inc. (1.7%), Baxter International, Inc. (1.6%), CVS Corp. (1.5%)
and Aetna Services, Inc. (1.5%).*
BONDS: WHEN RATES FELL, WE SOLD SOME LONG ISSUES
At the beginning of 1997, we thought interest rates were going to come down,
and they did fall sharply in the spring and early summer. In keeping with our
fixed-income strategy, we responded by reducing the portfolio's average
maturity. With our strong emphasis on quality, we hold more U.S. Treasury and
U.S. Government agency issues than corporate bonds. To mitigate concerns about
credit problems, we also make sure that our long-term bonds are Treasuries,
while our corporates have short- to intermediate-term maturities.
As of July 31, 1997, the fixed-income securities within the Fund maintained an
average credit quality of AAA, with an average maturity of 9.4 years.
CONTINUED GOOD FEELINGS ABOUT INTEREST RATES
As we've seen in recent months, interest rate moves can have a potent impact
on both stocks and bonds. Going forward, we think the path of least resistance
is for interest rates to go a little bit lower, though probably not a lot
lower. We don't think the Federal Reserve is going to raise interest rates in
the immediate future, for two reasons: First, we don't see any significant
pockets of inflation developing within the national economy. And second, we're
seeing from Congress and the President what is at least a credible attempt to
get the nation's fiscal house in order.
Do we feel more positive about stocks or about bonds? Since our portfolio is
split 50-50 between stocks and bonds, we're essentially neutral--although, on
a risk-adjusted basis, we favor bonds slightly.
+ The Fund's total return with a maximum 4.50% sales charge was 20.77% for the
period.
* The composition of the Fund's holdings is subject to change.
/1/ The Lipper Balanced Fund Index is comprised of managed funds whose primary
objective is to conserve principal by maintaining at all times a balanced
portfolio of both stocks and bonds. Typically, the stock/bond ratio ranges
around 60%/40%.
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<PAGE>
THE AMSOUTH BOND FUND
Bond Fund
Value of a $10,000 Investment
<TABLE>
<CAPTION>
Lehman Brothers Lipper Corporate
AmSouth Government/Corporate A-Rated Debt
Bond Fund* Bond Index Funds Index
<S> <C> <C> <C>
12/1/88 9,597 10,000 10,000
7/89 10,664 11,189 11,079
7/90 11,233 11,886 11,650
7/91 12,131 13,104 12,803
7/92 14,122 15,153 14,920
7/93 15,551 16,825 16,622
7/94 15,542 16,804 16,413
7/95 17,050 18,504 18,060
7/96 17,799 19,487 18,983
7/97 19,663 21,590 21,103
</TABLE>
Average Annual Total Return*
<TABLE>
<CAPTION>
Since
Inception
1 Year 5 Year (12/1/88)
<S> <C> <C> <C>
7/31/97 6.05% 5.98% 8.11%
</TABLE>
The performance of the AmSouth Bond Fund is measured against the Lehman Brothers
Government/Corporate Bond Index and the Lipper Corporate A-Rated Debt Funds
Index. The Lehman Brothers Government/Corporate Bond Index in an unmanaged index
generally representative of the total return of long-term government and
corporate bonds. The index does not reflect the deduction of expenses associated
with a mutual fund, such as investment management and fund accounting fees.
However, the Lipper Corporate A-Rated Debt Funds Index, a managed index, and the
Fund's performance do reflect the deduction of fees for these value-added
services. During the period shown, the Fund waived fees for various expenses.
Had these waivers not been in place, performance quoted would have been lower.
Past performance is not predictive of future results. The investment return and
NAV will fluctuate, so that an investor's shares, when redeemed, may be worth
more or less than the original cost.
* Reflects 4.00% sales charge.
The AmSouth Bond Fund is managed by Brian Sullivan, CFA. Mr. Sullivan is in
charge of fixed-income investments at AmSouth Bank and for the AmSouth Mutual
Funds. He has 13 years of fixed income investment management experience and
holds an MBA in finance and a bachelor's degree in economics.
MOST OF THE MONEY WAS MADE ON THE INCOME SIDE
For the 12 months ended July 31, 1997, the AmSouth Bond Fund produced a total
return of 10.48% (without the sales charge).+ In comparison, the Lehman
Brothers Government/Corporate Bond Index rose 10.79%, and the Lipper Corporate
A-Rated Debt Fund Index/1/ gained 11.17%. During the last year, the average
principal (capital gains) return provided by the bond market was rather small;
the bulk of the return was income or interest. Having a slightly longer-than-
average maturity portfolio enabled us to realize a little more principal
return.
ACTIVE MANAGEMENT PAID OFF
We followed our long-term strategy of buying longer bonds when interest rates
were high and shorter bonds when rates were low. We continued to lengthen the
portfolio's maturity through April, until interest rates started to go down.
Then we slowly shortened the maturity. In the three months from April to July,
long-term interest rates fell about 70 basis points (seven tenths of one
percent), a fairly sharp drop for such a short time frame.
-12-
<PAGE>
We are active managers; we try to take advantage of increases and decreases in
interest rates. This is important, because since World War II, the average
annual principal return has been larger than the average annual income (yield)
return. We try to gain some extra return for our investors by taking advantage
of fluctuations in principal return. We do that by lengthening and shortening
the Fund's average maturity.
A GREATER-THAN-AVERAGE WEIGHTING IN CORPORATES
As of July 31, we had about 60% of the portfolio invested in notes issued by
the U.S. Treasury and U.S. Government agencies, with the remaining 40% in
corporate issues.* Historically, that's more than we normally have in
corporates. As investors' money flowed into the Fund, we bought relatively
short corporate issues instead of increasing our maturity by buying longer
instruments. We felt that buying shorter term, high-quality corporates would
provide a little more return, without increasing the interest rate risk of
holding longer term bonds.
We don't feel our corporate holdings are unduly at risk in the event of a
recession. Our corporate portfolio is of very high quality--we generally buy
instruments that are A-rated or better and that have a relatively short
average maturity. That helps reduce risk in two ways: One, from the credit
standpoint, and two, from a scenario of rising interest rates.
As of July 31, 1997, the securities within the Fund maintained an average
credit quality of AAA, with an average maturity of 9.1 years.
A HOSPITABLE INTEREST-RATE ENVIRONMENT
We think the bond market offers attractive investment opportunities at this
time. We believe rates are likely to fall from here. Our outlook is that rates
will be flat to lower over the next six months--with a heavy emphasis on
lower. Our portfolio is still long, especially compared to the average
maturity of the Lehman Brothers Government/Corporate Bond Index. This will be
an advantage should interest rates in fact decline.
+ The Fund's total return with a maximum 4.00% sales charge was 6.05% for the
period.
* The composition of the Fund's holdings is subject to change.
/1/ The Lipper Corporate A-Rated Debt Fund Index is comprised of managed funds
that primarily invest 65% of their assets in corporate debt issues rated "A"
or better or government issues and reflects the deduction of fees for these
value-added services.
-13-
<PAGE>
THE AMSOUTH GOVERNMENT INCOME FUND
Government Income Fund
Value of a $10,000 Investment
<TABLE>
<CAPTION>
Lipper U.S.
AmSouth Government Lehman Brothers Mortgage
Income Fund* Mortgage Index Funds Index
<S> <C> <C> <C>
10/1/93 9,597 10,000 10,000
7/31/94 9,572 9,966 9,633
7/31/95 10,378 11,011 10,432
7/31/96 10,888 11,680 10,945
7/97 12,000 12,933 12,057
</TABLE>
Average Annual Total Return*
<TABLE>
<CAPTION>
Since
Inception
1 Year (10/1/93)
<S> <C> <C>
7/31/97 5.82% 4.87%
</TABLE>
The performance of the AmSouth Government Income Fund is measured against the
Lehman Brothers Mortgage Index and the Lipper U.S. Mortgage Fund Index. The
Lehman Brothers Mortgage Index is an unmanaged index generally representative of
the mortgage bond market as a whole. The index does not reflect the deduction of
expenses associated with a mutual fund, such as investment management and fund
accounting fees. However, the Lipper U.S. Mortgage Fund Index, a managed index,
and the Fund's performance do reflect the deduction of fees for these
value-added services. During the period shown, the Fund waived fees for various
expenses. Had these waivers not been in place, performance quoted would have
been lower. Past performance is not predictive of future results. The investment
return and NAV will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than the original cost.
* Reflects 4.00% sales charge.
The AmSouth Government Income Fund is managed by John Boston, CFA, Mr. Boston
has 9 years of experience as a fixed-income manager. He holds a bachelor's
degree in finance.
The AmSouth Government Income Fund is a mixture of mortgage-backed securities,
principally Ginnie Maes (GNMAs), and intermediate- to long-term U.S. Treasury
bonds. We favor GNMAs because they offer significantly higher yields than
Treasuries and are the highest quality bonds among mortgage-backed securities,
because they are the only type of mortgage security to be backed by the full
faith and credit of the U.S. Government.
For the 12 months ended July 31, 1997, the AmSouth Government Income Fund
produced a total return of 10.21% (without the sales charge).+ In comparison,
the Lehman Brothers Mortgage Index rose 10.73%, while the Lipper U.S. Mortgage
Fund Index/1/ gained 10.16%.
-14-
<PAGE>
HOLDING GINNIE MAES WAS A WINNING HAND
Throughout the last year, we emphasized mortgage-backed securities. This
strategy proved fruitful, as the mortgage sector was the best-performing
sector of the bond market for the last six months. We were able to maintain a
high level of income during a period of falling interest rates, and to add
appreciation to the net asset value of the share price.
During the last 12 months, we increased the proportion of Ginnie Maes in our
portfolio to 80% at the end of July--up from 74% in January and 68% last
summer.* At the same time, we shortened the average maturity of the Fund to
8.6 years at the end of July--down from 9.2 years in January and 9.8 years
last summer.
Prepayment risk is always a factor with mortgage securities; when interest
rates fall, debtors like to pay off their mortgages and refinance at lower
rates. Prepayment risk heightens in an environment of falling interest rates,
such as the one we've seen the last few months. One of the techniques we may
use to offset such risk is to buy noncallable U.S. Treasury securities, which
can help enhance returns and hedge against the increased prepayments that come
when interest rates decline.
BONDS SHOULD CONTINUE TO DO WELL
The economy grew erratically over the last year, which caused some
uncertainty--along with volatile interest rates. This set of circumstances
could continue for the foreseeable future. Nevertheless, we think we're in a
good environment for bonds, an environment of moderate economic growth coupled
with low inflation. Over the next year, this climate may well allow interest
rates to trend lower, which could enhance our returns. We're also quite
comfortable with the very high quality of our portfolio.
+ The Fund's total return with a maximum 4.00% sales charge was 5.82% for the
period.
* The composition of the Fund's holdings is subject to change.
/1/ The Lipper U.S. Mortgage Fund Index is comprised of managed funds that
invest at least 65% of their assets in mortgages/securities issued or
guaranteed as to principal and interest by the U.S. Government and certain
federal agencies.
-15-
<PAGE>
THE AMSOUTH LIMITED MATURITY FUND
Limited Maturity Fund
Value of a $10,000 Investment
<TABLE>
<CAPTION>
Merrill Lynch 1-5 Year Lipper Short
AmSouth Limited Government/Corporate Investment Grade
Maturity Fund* Bond Index Debt Index
<S> <C> <C> <C>
2/1/89 9,597 10,000 10,000
7/89 10,256 10,783 10,640
7/90 10,953 11,608 11,443
7/91 11,946 12,786 12,455
7/92 13,318 14,373 13,829
7/93 14,213 15,397 14,765
7/94 14,323 15,670 15,082
7/95 15,419 16,925 16,093
7/96 16,149 17,842 16,976
7/97 17,321 19,266 18,190
</TABLE>
Average Annual Total Return*
<TABLE>
<CAPTION>
Since
Inception
1 Year 5 Year (2/1/89)
<S> <C> <C> <C>
7/31/97 2.96% 4.54% 6.67%
</TABLE>
The performance of the AmSouth Limited Maturity Fund is measured against the
Merrill Lynch 1-5 Year Government/Corporate Bond Index and the Lipper Short
Investment Grade Debt Index. The Merrill Lynch 1-5 Year Government/Corporate
Bond Index is an unmanaged index generally representative of the total return of
short-term government and corporate bonds. The index does not reflect the
deduction of expenses associated with a mutual fund, such as investment
management and fund accounting fees. However, the Lipper Short Investment Grade
Debt Index, a managed index, and the Fund's performance do reflect the deduction
of fees for these value-added services. During the period shown, the Fund waived
fees for various expenses. Had these waivers not been in place, performance
quoted would have been lower. Past performance is not predictive of future
results. The investment return and NAV will fluctuate, so that an investor's
shares, when redeemed, may be worth more or less than the original cost.
* Reflects 4.00% sales charge.
The AmSouth Limited Maturity Fund is managed by John Boston, CFA. Mr. Boston
has 9 years of experience as a fixed-income portfolio manager. He holds a
bachelor's degree in finance.
For the 12 months ended July 31, 1997, the AmSouth Limited Maturity Fund
produced a total return of 7.25% (without the sales charge).+ In comparison,
the Merrill Lynch 1-5-Year Government/Corporate Bond Index rose 8.00%, and the
Lipper Short Investment Grade Debt Index/1/ gained 7.00%.
GOOD NEWS ON ALL FRONTS
Overall, the bond market turned in a good performance, and the Fund benefited
from the broader market's strength. One particularly advantageous factor was
our emphasis on one of the better-performing sectors of the bond market:
corporate bonds. During the last six months, corporates outperformed government
securities. That strategy paid off in helping to produce good returns.
We also lengthened the average maturity of the portfolio. At the end of July,
it was 3.3 years, up from 2.8 years in January and 2.0 years last summer, and
the average credit quality was AAA. We probably were a little early in
lengthening
-16-
<PAGE>
maturities. No one has perfect foresight in predicting interest-rate moves,
and as interest rates were rising, the longer structure didn't help us much.
But our extended maturities paid off handsomely when interest rates dropped
sharply this spring.
One result was that the Fund's net asset value (NAV) rose from $10.32 to
$10.42 a share during the six months ended July 31. Not only did we maintain a
good income stream, but our shareholders also benefited from the rising share
price.
PARING BACK ON CORPORATE BONDS
Having highlighted the contributions made by the corporate portion of our
portfolio, we should note that we've been getting progressively more selective
about the corporate bonds we add to our portfolio. We're in the sixth year of
an economic expansion, which is getting a little old at this point. Although
we're not forecasting a recession, we think this is a good time to be more
careful with corporate bonds; corporates carry some degree of credit risk,
especially during leaner economic times. Also the spread (the premium in yield
paid for corporate bonds over Treasury issues) is not what it was two or three
years ago. As of July 31, 1997, the proportion of corporate bonds in our
portfolio was 55%, down from 61% on January 31, 1997, and 84% last summer.*
A FAVORABLE CLIMATE FOR INTEREST RATES
We think there's room for interest rates to come down further. Inflation has
trended lower in recent months, to where the Consumer Price Index currently
(in mid-August) is rising at a tame 2.3% annual rate. And with long-term bonds
yielding about 6.5%, you have more than a 4% "real rate" spread over the
inflation rate; this is high by historical standards. If you believe that
inflation is going to remain near its current level, there is room for
interest rates to come down and close that gap, and to take real rates lower.
+ The Fund's total return with a maximum 4.00% sales charge was 2.96% for the
period.
* The composition of the Fund's holdings is subject to change.
/1/ The Lipper Short Investment Grade Debt Index is comprised of managed funds
that invest at least 65% of their assets in investment grade debt issues
(rated in top four grades) with dollar-weighted average maturities of less
than three years.
-17-
<PAGE>
THE AMSOUTH FLORIDA TAX-FREE FUND/1/
Florida Tax-Free Fund/1/
Value of a $10,000 Investment
<TABLE>
<CAPTION>
AmSouth Florida Merrill Lynch 3-7 Year
Tax-Free Fund* Municipal Bond Index
<S> <C> <C>
9/30/94 9,597 10,000
7/31/95 10,224 10,670
7/31/96 10,658 11,147
7/31/97 11,392 11,943
</TABLE>
Average Annual Total Return*
<TABLE>
<CAPTION>
Since
Inception
1 Year (9/30/94)
<S> <C> <C>
7/31/97 2.61% 4.70%
</TABLE>
The performance of the AmSouth Florida Tax-Free Fund is measured against the
Merrill Lynch 3-7 Year Municipal Bond Index, an unmanaged index generally
representative of intermediate-term municipal bonds. The index does not reflect
the deduction of expenses associated with a mutual fund, such as investment
management and fund accounting fees. However, the Fund's performance reflects
the deduction of fees for these value-added services. During the period shown,
the Fund waived fees for various expenses. Had these waivers not been in place,
performance quoted would have been lower. Past performance is not predictive of
future results. This investment return and NAV will fluctuate, so that an
investor's shares, when redeemed, may be worth more or less than the original
cost.
* Reflects 4.00% sales charge.
The AmSouth Florida Tax-Free Fund is managed by Dorothy Thomas, who has 14
years of experience as an investment portfolio manager for municipal bond
accounts, personal trusts and endowments. Ms. Thomas holds an MBA and a
bachelor's degree in economics.
RETURNS THAT WERE CONSISTENT WITH HISTORICAL PERFORMANCE
For the 12 months ended July 31, 1997, the AmSouth Florida Tax-Free Fund
produced a total return of 6.89% (without the sales charge).+ In comparison,
the Merrill Lynch 3-7-Year Municipal Bond Index rose 7.14%. In addition to
providing investors with current income exempt from federal income tax and
Florida intangibles taxes, the Fund produced a one-year return that was in line
with its historical return of 6.23% (without the sales charge).++
A CONTINUING EMPHASIS ON QUALITY
We continued to upgrade the quality of the bonds in our portfolio during the
last 12 months. We did this mainly because in the municipal bond market, the
so-called "quality spreads" (the extra yields that generally are available on
lower quality issues) have been narrowing; they are about as narrow as we've
seen for many years. When spreads are this modest, you're being paid very
little
-18-
<PAGE>
additional yield for taking on the risks of lower credit quality. In this
environment, we feel we're better off holding higher quality bonds.
A lot of the bonds in the portfolio also are insured. (Most of the time,
municipal bonds are insured when they are issued; the insurance is arranged by
the underwriter of the bond and its issuer.) Nevertheless, we always look at
the underlying credit of every issue we buy. That's another important aspect
of our emphasis on quality.
As of July 31, 1997, the securities within the Fund maintained an average
credit quality of AA, with an average maturity of 6.2 years.
NO BIG BETS ON INTEREST RATES
Over the last few months of the fiscal year, we extended our average maturity
to take advantage of the last quarter's sizable decline in interest rates.
However, at the end of July, we were not positioned for a further significant
decline in interest rates. We would benefit somewhat from a further decline,
but we haven't been extending our average maturity any further.
It is part of our overall strategy to make prudent changes to our portfolio
structure when we anticipate broad changes in market conditions. For example,
if we anticipated that the Federal Reserve were going to move interest rates
significantly in one direction or another over the next year or so, we would
try to position ourselves to benefit from that action. But we do not do that
on a short-term basis; we don't try to anticipate what the next month will
bring. For that reason, we will focus on maintaining a high-quality,
diversified portfolio that meets our investment criteria.
+ The Fund's total return with a maximum 4.00% sales charge was 2.61% for the
period.
++ The Fund's total return with a maximum 4.00% sales charge was 4.70% since
inception.
/1/ The Fund's income may be subject to the federal alternative minimum tax and
to certain state and local taxes.
-19-
<PAGE>
THE AMSOUTH MUNICIPAL BOND FUND
Municipal Bond Fund/1/
Value of a $10,000 Investment
<TABLE>
<CAPTION>
Lehman Brothers Municipal
AmSouth Municipal Lipper Intermediate Bond Index/Merrill Lynch
Bond Fund* Municipal Debt Index 3-7 Year Municipal Bond Index
<S> <C> <C> <C>
8/1/87 9,600 10,000 10,000
7/88 10,160 10,536 10,703
7/89 11,008 11,472 10,000
7/90 11,611 12,194 10,544
7/91 12,476 13,171 11,561
7/92 13,811 14,777 12,825
7/93 14,561 15,789 13,736
7/94 14,811 16,151 14,125
7/95 15,702 17,185 14,962
7/96 16,263 18,035 15,631
7/97 17,346 19,439 16,748
</TABLE>
Average Annual Total Return*
<TABLE>
<CAPTION>
1 Year 5 Year 10 Years
<S> <C> <C> <C>
7/31/97 2.39% 3.81% 5.66%
</TABLE>
The AmSouth Municipal Bond Fund's performance is measured against the Lehman
Brothers Municipal Bond Index from 7/31/87 to 7/31/89, prior to the creation of
the Merrill Lynch 3-7 Year Municipal Bond Index against which the performance is
measured. Both the Lehman Brothers and the Merrill Lynch 3-7 Year Municipal
indices are unmanaged indices that are generally representative of municipal
bonds with intermediate maturities. The Fund's performance is also measured
against the Lipper Intermediate Municipal Debt Funds Index. The Lehman Brothers
Municipal Bond Index and the Merrill Lynch 3-7 Year Municipal Index do not
reflect the deduction of fees associated with a mutual fund, such as investment
management and fund accounting fees. However, the Lipper Intermediate Municipal
Debt Funds Index, a managed index, and the Fund's performance do reflect the
deduction of fees for these value-added services. Past performance is not
indicative of future results. The investment return and NAV will fluctuate, so
that an investor's shares, when redeemed, may be worth more or less than their
original cost.
+ The quoted performance for the Municipal Bond Fund includes performance of
certain collective trust fund ("Commingled") accounts advised by AmSouth Bank,
for periods dating back to 8/1/75 and prior to the Municipal Bond Fund's
commencement of operations on 7/1/97, as adjusted to reflect the expenses
associated with the Fund. The Commingled accounts were not registered with the
Securities and Exchange Commission and, therefore, were not subject to the
investment restrictions imposed by law on registered mutual funds. If the
Commingled accounts had been registered, the Commingled accounts' performance
may have been adversely affected. The performance shown reflects the deduction
of fees for value-added services associated with a mutual fund, such as
investment management and fund accounting fees. The performance also reflects
reinvestment of all dividends and capital-gains distributions.
* Reflects 4.00% sales charge.
The AmSouth Municipal Bond Fund is managed by Dorothy Thomas, who has 14 years
of experience as an investment portfolio manager for municipal bond accounts,
personal trusts and endowments. Ms. Thomas holds an MBA and a bachelor's degree
in economics.
The AmSouth Municipal Bond Fund was opened to investors on July 1, 1997.
Performance of the Fund includes certain collective trust fund ("Commingled")
accounts advised by AmSouth Bank, for periods dating back to August 1, 1975.
The Fund produced a total return of 6.66% (without the sales charge)+ for the
one-year period and in comparison, the Merrill Lynch 3-7-Year Municipal Bond
Index rose 7.14%, while the Lipper Intermediate Municipal Debt Index/2/ gained
7.78% for the period.
-20-
<PAGE>
SEEKING A DIVERSIFIED PORTFOLIO
About 60% of the Fund is invested in municipal bonds issued within the state
of Alabama. The other 40% of the Fund is invested in a diversified portfolio
of bonds from other states; the portfolio is concentrated somewhat in the
Southeast but also includes selected bonds from nearly every region of the
country.* That makeup changes from time to time as we find opportunities to
buy bonds in states or regions that may represent a little more value.
We've emphasized Alabama bonds for the in-state tax advantage--many of our
shareholders are Alabama residents--but we also believe it's important to have
geographic and credit diversification by adding bonds from other states.
As of July 31, 1997, the securities within the Fund maintained an average
credit quality of AA, with an average maturity of 6.3 years.
BALANCING YIELD AND QUALITY
We can choose from a wide variety of municipal bond issues, and we continually
stress quality. In today's bond market, you don't get "paid" an excess
premium, or yield, for taking on extra credit risk, so we've been buying
strictly high-grade issues. We look at all types of general obligation and
revenue bonds--such as those issued by water systems, electric power
authorities, boards of education and state universities--and we want to be
comfortable with the sources of revenue that are pledged to service each
issuer's debt. Every instrument we consider is measured on its own terms and
credit quality. We also rely on reports from rating agencies.
Two factors, in particular, affect fund performance: interest rates and credit
quality.
Interest-rate movements have a larger effect on the value of the portfolio
than any other factor. Consequently, we are always reviewing the interest-rate
environment and considering whether we need to reposition our portfolio, based
on our interest-rate expectations. The next-most-important factor is a change
in a particular bond's credit quality. Presently, we are in a credit position
that is relatively low risk.
AN UNDER-UTILIZED OPPORTUNITY FOR LONG-TERM INVESTORS
The majority of our shareholders are most concerned with seeking current
income that is free from federal income taxes and often, to some extent, state
taxes. However, people investing for retirement also can find value in owning
shares of our Fund. Many of these investors are inclined to take advantage of
opportunities to earn returns that will grow tax-free, such as Individual
Retirement Accounts and 401(k) plans. For those investors who already have
contributed the maximum amount to their tax-advantaged plans, a municipal bond
fund such as ours, which invests in tax-exempt bonds, may represent one of the
few tax-sheltered vehicles still remaining.
* The composition of the Fund's holdings is subject to change.
+ The Fund's total return with a maximum 4.00% sales charge was 2.39% for the
period.
/1/ The Fund's income may be subject to the federal alternative minimum tax and
to certain state and local taxes.
/2/ The Lipper Intermediate Municipal Debt Index is comprised of managed funds
that invest in municipal debt issues with dollar-weighted average
maturities.
-21-
<PAGE>
THE AMSOUTH MONEY MARKET FUNDS
The AmSouth Money Market Funds are managed by John Boston, CFA, a vice-
president and trust investment officer with AmSouth Bank. In addition to
serving as a portfolio manager for the AmSouth Mutual Funds, Mr. Boston also
manages several large institutional portfolios within the AmSouth Trust
Department.
THE SOUND OF ONE SHOE FALLING
After much anxiety and speculation in the financial community, the Federal
Reserve finally raised short-term interest rates by 25 basis points (one-
quarter of one percent) in late March. Rates spiked up briefly--while the bond
and stock markets fell precipitously--but the reaction was short-lived, and
within a month, the markets had regained their equilibrium.
Since March, the Fed has declined to raise interest rates further, and we
don't believe any dramatic announcements are imminent. Inflation remains under
control, and most indicators point to an economy that continues to expand at a
modest, sustainable pace.
From a historical perspective, current short-term interest rates are
relatively high compared to the rate of inflation, meaning that "real"
(inflation-adjusted) money-market returns are considerable.
. As of July 31, 1997, the Prime Obligations Fund's average maturity was 48
days, compared to 74 days on January 31, 1997, and 60 days on July 31, 1996.
. As of July 31, 1997, the U.S. Treasury Fund's average maturity was 45 days,
compared to about 60 days on January 31, 1997, and 64 days on July 31, 1996.
. As of July 31, 1997, the Tax-Exempt Fund's average maturity was 63 days,
compared to about 69 days on January 31, 1997, and 67 days on July 31, 1996.
Investments in the Prime Obligations, the U.S. Treasury and the Tax-Exempt
Money Market Funds are neither insured nor guaranteed by the U.S. Government.
Yields will fluctuate, and there is no assurance that the Funds will be able
to maintain a stable net asset value of $1.00 per share.
The total return set forth may reflect the waiver of a portion of the fund's
advisory or administrative fees for certain periods since the inception date.
In such instances, and without waiver of fees, total return would have been
lower.
-22-
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Trustees of AmSouth Mutual Funds
We have audited the accompanying statements of assets and liabilities of
AmSouth Mutual Funds (comprising, respectively, Prime Obligations Fund, U.S.
Treasury Fund, Tax-Exempt Fund, Bond Fund, Limited Maturity Fund, Government
Income Fund, Florida Tax-Free Fund, Municipal Bond Fund, Equity Fund, Regional
Equity Fund, Equity Income Fund, and Balanced Fund), including the schedules
of portfolio investments, as of July 31, 1997, and the related statements of
operations, statements of changes in net assets, and the financial highlights
for each of the periods presented. These financial statements and financial
highlights are the responsibility of AmSouth Mutual Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of securities
owned as of July 31, 1997 by correspondence with the custodian and brokers or
other auditing procedures where confirmations from brokers were not received.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of each
of the respective funds comprising AmSouth Mutual Funds as of July 31, 1997,
and the results of their operations and the changes in their net assets and
the financial highlights for the periods referred to above in conformity with
generally accepted accounting principles.
COOPERS & LYBRAND L.L.P.
Columbus, Ohio
September 25, 1997
-23-
<PAGE>
AMSOUTH MUTUAL FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
July 31, 1997
(Amounts in Thousands, except Per Share Amounts)
<TABLE>
<CAPTION>
REGIONAL EQUITY
EQUITY EQUITY INCOME BALANCED
FUND FUND FUND FUND
-------- -------- ------- --------
<S> <C> <C> <C> <C>
ASSSETS:
Investments, at value (Cost $97,543;
$623,225; $20,222; and $282,535,
respectively).......................... $149,800 $975,756 $22,364 $370,529
Cash.................................... -- 1 -- 1
Interest and dividends receivable....... 214 2,173 76 3,449
Receivable for capital shares issued.... 70 233 92 49
Unamortized organizational costs........ -- -- 12 --
Prepaid expenses and other assets....... 1 1 8 3
-------- -------- ------- --------
Total Assets........................ 150,085 978,164 22,552 374,031
-------- -------- ------- --------
LIABILITIES:
Payable for capital shares redeemed..... 47 197 -- 67
Dividends payable....................... 71 768 36 885
Payable to brokers for investments
purchased.............................. -- 1,418 223 --
Accrued expenses and other payables:
Investment advisory fees.............. 103 642 14 256
Administration fees................... 5 32 1 12
Accounting fees....................... 1 5 -- 2
Transfer agent fees................... 11 23 -- 19
Custodian fees........................ -- 7 2 --
Printing fees......................... 2 27 -- 8
Other................................. 7 60 3 13
-------- -------- ------- --------
Total Liabilities................... 247 3,179 279 1,262
-------- -------- ------- --------
NET ASSETS:
Capital................................. 94,237 595,954 19,868 271,394
Undistributed (distributions in excess
of) net investment income.............. 4 308 15 (102)
Net unrealized appreciation
(depreciation) from investments........ 52,257 352,531 2,142 87,994
Accumulated undistributed net realized
gains from investment transactions..... 3,340 26,192 248 13,483
-------- -------- ------- --------
Net Assets.......................... $149,838 $974,985 $22,273 $372,769
======== ======== ======= ========
Outstanding units of beneficial interest
(shares)............................... 5,307 41,750 1,900 24,504
======== ======== ======= ========
Net asset value--redemption price per
share.................................. $ 28.23 $ 23.35 $ 11.72 $ 15.21
======== ======== ======= ========
Maximum sales charge.................... 4.50% 4.50% 4.50% 4.50%
-------- -------- ------- --------
Maximum offering price (100%/(100%--
maximum sales charge) of net asset
value rounded to the nearest cent) per
share.................................. $ 29.56 $ 24.45 $ 12.27 $ 15.93
======== ======== ======= ========
</TABLE>
See notes to financial statements.
-24-
<PAGE>
AMSOUTH MUTUAL FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
July 31, 1997
(Amounts in Thousands, except Per Share Amounts)
<TABLE>
<CAPTION>
FLORIDA
GOVERNMENT LIMITED TAX- MUNICIPAL
BOND INCOME MATURITY FREE BOND
FUND FUND FUND FUND FUND
-------- ---------- -------- ------- ---------
<S> <C> <C> <C> <C> <C>
ASSETS:
Investments, at value (Cost
$298,739; $11,386; $134,236;
$50,949; and $320,443,
respectively)............... $310,506 $11,622 $136,699 $53,231 $333,904
Interest and dividends
receivable.................. 6,547 94 2,737 703 5,381
Receivable from brokers for
investments sold............ 571 -- -- -- --
Unamortized organizational
costs....................... -- -- -- -- 20
Prepaid expenses and other
assets...................... -- -- -- 1 1
-------- ------- -------- ------- --------
Total Assets............. 317,624 11,716 139,436 53,935 339,306
-------- ------- -------- ------- --------
LIABILITIES:
Cash overdraft............... -- 1 -- -- --
Payable for capital shares
redeemed.................... 39 14 5 -- --
Dividends payable............ 1,544 66 674 200 1,201
Payable to brokers for
investments purchased....... 3,986 -- -- -- --
Accrued expenses and other
payables:
Investment advisory fees... 131 3 59 14 111
Administration fees........ 6 -- 3 1 7
Accounting fees............ 3 1 1 2 2
Transfer agent fees........ 15 3 7 6 3
Custodian fees............. 1 -- 2 -- 1
Printing fees.............. 6 -- 2 22 14
Organizational fees........ -- -- -- -- 20
Other...................... 12 6 8 2 14
-------- ------- -------- ------- --------
Total Liabilities........ 5,743 94 761 247 1,373
-------- ------- -------- ------- --------
NET ASSETS:
Capital...................... 300,421 11,938 138,318 51,281 324,456
Undistributed (distributions
in excess of) net investment
income...................... 384 (62) 33 (6) (5)
Net unrealized appreciation
(depreciation) from
investments................. 11,767 236 2,463 2,282 13,461
Accumulated undistributed net
realized gains
(losses) from investment
transactions................ (691) (490) (2,139) 131 21
-------- ------- -------- ------- --------
Net Assets............... $311,881 $11,622 $138,675 $53,688 $337,933
======== ======= ======== ======= ========
Outstanding units of
beneficial interest
(shares).................... 28,548 1,192 13,302 5,112 33,279
======== ======= ======== ======= ========
Net asset value--redemption
price per share............. $ 10.92 $ 9.75 $ 10.42 $ 10.50 $ 10.15
======== ======= ======== ======= ========
Maximum sales charge......... 4.00% 4.00% 4.00% 4.00% 4.00%
-------- ------- -------- ------- --------
Maximum offering price
(100%/(100%--maximum sales
charge) of net asset value
rounded to the nearest cent)
per share................... $ 11.38 $ 10.16 $ 10.85 $ 10.94 $ 10.57
======== ======= ======== ======= ========
</TABLE>
See notes to financial statements.
-25-
<PAGE>
AMSOUTH MUTUAL FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
July 31, 1997
(Amounts in Thousands, except Per Share Amounts)
<TABLE>
<CAPTION>
PRIME U.S. TAX-
OBLIGATIONS TREASURY EXEMPT
FUND FUND FUND
----------- -------- -------
<S> <C> <C> <C>
ASSETS:
Investments, at amortized cost................... $464,685 $208,924 $82,905
Repurchase agreements, at cost................... 64,263 110,452 --
-------- -------- -------
528,948 319,376 82,905
Interest receivable.............................. 1,628 1,199 710
Prepaid expenses and other assets................ 2 -- 1
-------- -------- -------
Total Assets................................. 530,578 320,575 83,616
-------- -------- -------
LIABILITIES:
Dividends payable................................ 2,316 1,177 225
Accrued expenses and other payables:
Investment advisory fees....................... 184 101 15
Administration fees............................ 18 10 3
Shareholder servicing fees..................... 10 1 2
Accounting fees................................ 4 2 3
Transfer agent fees............................ 27 13 5
Custodian fees................................. -- 4 --
Printing fees.................................. 6 5 --
Other.......................................... 20 16 8
-------- -------- -------
Total Liabilities............................ 2,585 1,329 261
-------- -------- -------
NET ASSETS:
Capital.......................................... 528,002 319,245 83,357
Accumulated undistributed net realized gains
(losses) from investment transactions........... (9) 1 (2)
-------- -------- -------
Net Assets................................... $527,993 $319,246 $83,355
======== ======== =======
Net Assets:
Classic Shares................................. $111,027 $ 9,885 $27,926
Premier Shares................................. 416,966 309,361 55,429
-------- -------- -------
$527,993 $319,246 $83,355
======== ======== =======
Outstanding units of beneficial interest (shares)
Classic Shares................................. 111,033 9,885 27,927
Premier Shares................................. 416,983 309,359 55,430
-------- -------- -------
528,016 319,244 83,357
======== ======== =======
Net asset value--offering and redemption price
per share
Classic Shares................................. $ 1.00 $ 1.00 $ 1.00
======== ======== =======
Premier Shares................................. $ 1.00 $ 1.00 $ 1.00
======== ======== =======
</TABLE>
See notes to financial statements.
-26-
<PAGE>
AMSOUTH MUTUAL FUNDS
STATEMENTS OF OPERATIONS
For the Year Ended July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
REGIONAL EQUITY
EQUITY EQUITY INCOME BALANCED
FUND FUND FUND (A) FUND
-------- -------- -------- --------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest income............................. $ -- $ 113 $ 59 $11,321
Dividend income............................. 2,443 11,902 96 4,868
------- -------- ------ -------
Total Income.............................. 2,443 12,015 155 16,189
------- -------- ------ -------
EXPENSES:
Investment advisory fees.................... 953 3,733 36 2,855
Administration fees......................... 239 934 9 714
Accounting fees............................. 37 142 13 118
Transfer agent fees......................... 41 83 2 75
Custodian fees.............................. 7 28 2 20
Legal and audit fees........................ 18 79 5 53
Trustees' fees and expenses................. 4 17 -- 14
Registration and filing fees................ 7 57 1 17
Printing fees............................... 8 42 -- 29
Organizational fees......................... -- -- 1 --
Other....................................... 2 9 -- 7
------- -------- ------ -------
Total Expenses............................ 1,316 5,124 69 3,902
Expenses voluntarily reduced................ (51) (188) (10) (165)
------- -------- ------ -------
Net Expenses.............................. 1,265 4,936 59 3,737
------- -------- ------ -------
Net Investment Income....................... 1,178 7,079 96 12,452
------- -------- ------ -------
REALIZED/UNREALIZED GAINS (LOSSES) FROM
INVESTMENTS:
Net realized gains (losses) from investment
transactions............................... 4,481 31,338 248 16,168
Change in unrealized
appreciation/depreciation from investments. 34,116 151,828 2,142 55,439
------- -------- ------ -------
Net realized gains (losses) from
investments................................ 38,597 183,166 2,390 71,607
------- -------- ------ -------
Change in net assets resulting from
operations................................. $39,775 $190,245 $2,486 $84,059
======= ======== ====== =======
</TABLE>
- --------
(a) For the period March 20, 1997 (commencement of operations) through July 31,
1997.
See notes to financial statements.
-27-
<PAGE>
AMSOUTH MUTUAL FUNDS
STATEMENTS OF OPERATIONS
For the Year Ended July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
GOVERNMENT LIMITED FLORIDA MUNICIPAL
BOND INCOME MATURITY TAX-FREE BOND
FUND FUND FUND FUND FUND (A)
------- ---------- -------- -------- ---------
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest income.................. $10,129 $ 913 $3,147 $2,495 $1,365
Dividend income.................. 77 11 33 82 28
------- ------ ------ ------ ------
Total Income................... 10,206 924 3,180 2,577 1,393
------- ------ ------ ------ ------
EXPENSES:
Investment advisory fees......... 969 90 322 340 181
Administration fees.............. 298 28 99 104 55
Accounting fees.................. 51 36 32 47 9
Transfer agent fees.............. 46 14 21 24 3
Custodian fees................... 11 1 5 4 1
Legal and audit fees............. 24 5 12 8 17
Trustees' fees and expenses...... 5 1 3 2 4
Registration and filing fees..... 17 1 3 17 5
Printing fees.................... 37 3 11 8 14
Organizational fees.............. -- -- -- -- --
Other............................ 3 -- 1 1 --
------- ------ ------ ------ ------
Total Expenses................. 1,461 179 509 555 289
Expenses voluntarily reduced..... (343) (84) (126) (256) (92)
------- ------ ------ ------ ------
Net Expenses................... 1,118 95 383 299 197
------- ------ ------ ------ ------
Net Investment Income............ 9,088 829 2,797 2,278 1,196
------- ------ ------ ------ ------
REALIZED/UNREALIZED GAINS
(LOSSES)
FROM INVESTMENTS:
Net realized gains (losses) from
investment transactions......... (340) 41 (639) 135 21
Change in unrealized
appreciation/depreciation
from investments................ 10,605 483 2,509 1,102 5,152
------- ------ ------ ------ ------
Net realized/unrealized gains
(losses) from investments....... 10,265 524 1,870 1,237 5,173
------- ------ ------ ------ ------
Change in net assets resulting
from operations................. $19,353 $1,353 $4,667 $3,515 $6,369
======= ====== ====== ====== ======
</TABLE>
- --------
(a) For the period July 1, 1997 (commencement of operations) through July 31,
1997.
See notes to financial statements.
-28-
<PAGE>
AMSOUTH MUTUAL FUNDS
STATEMENTS OF OPERATIONS
For the Year Ended July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
PRIME U.S. TAX-
OBLIGATIONS TREASURY EXEMPT
FUND FUND FUND
----------- -------- ------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest income................................... $32,939 $17,539 $2,910
------- ------- ------
Total Income.................................... 32,939 17,539 2,910
------- ------- ------
EXPENSES:
Investment advisory fees.......................... 2,367 1,325 322
Administration fees............................... 1,183 663 161
Shareholder servicing fees (Classic Shares)....... 305 28 50
Accounting fees................................... 189 109 43
Transfer agent fees............................... 91 74 27
Custodian fees.................................... 29 10 2
Legal and audit fees.............................. 72 43 11
Trustees' fees and expenses....................... 15 9 3
Registration and filing fees...................... 3 19 2
Printing fees..................................... 55 28 8
Other............................................. 15 11 1
------- ------- ------
Total Expenses.................................. 4,324 2,319 630
Expenses voluntarily reduced...................... (183) (17) (194)
------- ------- ------
Net Expenses.................................... 4,141 2,302 436
------- ------- ------
Net Investment Income............................. 28,798 15,237 2,474
------- ------- ------
REALIZED GAINS (LOSSES) FROM INVESTMENT
TRANSACTIONS:
Net realized gains (losses) from investment
transactions..................................... -- -- (2)
------- ------- ------
Change in net assets resulting from operations.... $28,798 $15,237 $2,472
======= ======= ======
</TABLE>
See notes to financial statements.
-29-
<PAGE>
AMSOUTH MUTUAL FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
(Amounts in Thousands)
<TABLE>
<CAPTION>
REGIONAL EQUITY EQUITY INCOME
FUND EQUITY FUND FUND BALANCED FUND
------------------ ------------------- ------------- ------------------
YEAR YEAR YEAR YEAR FOR THE YEAR YEAR
ENDED ENDED ENDED ENDED PERIOD ENDED ENDED ENDED
JULY 31, JULY 31, JULY 31, JULY 31, JULY 31, JULY 31, JULY 31,
1997 1996 1997 1996 1997 (A) 1997 1996
-------- -------- --------- -------- ------------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income.... $ 1,178 $ 1,090 $ 7,079 $ 6,319 $ 96 $ 12,452 $ 11,729
Net realized gains
(losses) from investment
transactions............ 4,481 1,891 31,338 20,434 248 16,168 14,292
Net change in unrealized
appreciation/depreciation
from investments........ 34,116 6,486 151,828 6,857 2,142 55,439 (568)
-------- ------- --------- -------- ------- -------- --------
Change in net assets
resulting from operations. 39,775 9,467 190,245 33,610 2,486 84,059 25,453
-------- ------- --------- -------- ------- -------- --------
DISTRIBUTIONS TO
SHAREHOLDERS:
From net investment
income.................. (1,196) (1,069) (7,031) (6,319) (81) (13,031) (11,648)
In excess of net
investment income....... -- -- -- (7) -- -- --
From net realized gains
from investment
transactions............ (2,315) (755) (21,737) (10,800) -- (15,072) (7,455)
-------- ------- --------- -------- ------- -------- --------
Change in net assets from
shareholder distributions. (3,511) (1,824) (28,768) (17,126) (81) (28,103) (19,103)
-------- ------- --------- -------- ------- -------- --------
CAPITAL TRANSACTIONS:
Proceeds from shares
issued (See Note 8)..... 34,563 26,244 556,310 140,796 20,123 79,422 93,191
Dividends reinvested..... 1,945 1,130 14,093 10,225 37 20,289 14,962
Cost of shares redeemed.. (16,518) (9,934) (131,517) (68,640) (292) (121,323) (71,587)
-------- ------- --------- -------- ------- -------- --------
Change in net assets from
share transactions........ 19,990 17,440 438,886 82,381 19,868 (21,612) 36,566
-------- ------- --------- -------- ------- -------- --------
Change in net assets....... 56,254 25,083 600,363 98,865 22,273 34,344 42,916
NET ASSETS:
Beginning of period...... 93,584 68,501 374,622 275,757 -- 338,425 295,509
-------- ------- --------- -------- ------- -------- --------
End of period............ $149,838 $93,584 $ 974,985 $374,622 $22,273 $372,769 $338,425
======== ======= ========= ======== ======= ======== ========
SHARE TRANSACTIONS:
Issued................... 1,439 1,277 26,434 8,082 1,923 5,836 7,104
Reinvested............... 84 55 773 597 4 1,523 1,148
Redeemed................. (683) (482) (6,713) (3,888) (27) (8,820) (5,449)
-------- ------- --------- -------- ------- -------- --------
Change in shares........... 840 850 20,494 4,791 1,900 (1,461) 2,803
======== ======= ========= ======== ======= ======== ========
</TABLE>
- --------
(a) For the period from March 20, 1997 (commencement of operations) to July 31,
1997.
See notes to financial statements.
-30-
<PAGE>
AMSOUTH MUTUAL FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
(Amounts in Thousands)
<TABLE>
<CAPTION>
GOVERNMENT INCOME
BOND FUND FUND LIMITED MATURITY FUND
------------------ ------------------ ----------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED YEAR ENDED YEAR ENDED
JULY 31, JULY 31, JULY 31, JULY 31, JULY 31, JULY 31,
1997 1996 1997 1996 1997 1996
-------- -------- -------- -------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income.... $ 9,088 $ 6,705 $ 829 $ 1,198 $ 2,797 $ 3,206
Net realized gains
(losses) from investment
transactions............ (340) (140) 41 (352) (639) (229)
Net change in unrealized
appreciation/depreciation
from investments........ 10,605 (2,348) 483 (9) 2,509 (275)
-------- -------- ------- ------- ---------- ----------
Change in net assets
resulting from operations. 19,353 4,217 1,353 837 4,667 2,702
-------- -------- ------- ------- ---------- ----------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment
income.................. (9,548) (6,517) (829) (1,089) (2,942) (3,206)
In excess of net
investment income....... -- -- -- -- -- (63)
In excess of net realized
gains................... -- (1,025) -- (10) -- --
-------- -------- ------- ------- ---------- ----------
Change in net assets from
shareholder distributions. (9,548) (7,542) (829) (1,099) (2,942) (3,269)
-------- -------- ------- ------- ---------- ----------
CAPITAL TRANSACTIONS:
Proceeds from shares
issued (See Note 8)..... 201,871 57,993 1,446 5,601 115,330 16,713
Dividends reinvested..... 5,240 5,036 412 574 865 1,563
Cost of shares redeemed.. (37,772) (21,638) (6,512) (6,840) (25,250) (31,502)
-------- -------- ------- ------- ---------- ----------
Change in net assets from
share transactions........ 169,339 41,391 (4,654) (665) 90,945 (13,226)
-------- -------- ------- ------- ---------- ----------
Change in net assets....... 179,144 38,066 (4,130) (927) 92,670 (13,793)
NET ASSETS:
Beginning of period...... 132,737 94,671 15,752 16,679 46,005 59,798
-------- -------- ------- ------- ---------- ----------
End of period............ $311,881 $132,737 $11,622 $15,752 $ 138,675 $ 46,005
======== ======== ======= ======= ========== ==========
SHARE TRANSACTIONS:
Issued................... 18,995 5,396 153 584 11,205 1,602
Reinvested............... 494 467 43 60 84 150
Redeemed................. (3,539) (2,005) (680) (715) (2,449) (3,036)
-------- -------- ------- ------- ---------- ----------
Change in shares........... 15,950 3,858 (484) (71) 8,840 (1,284)
======== ======== ======= ======= ========== ==========
</TABLE>
See notes to financial statements.
-31-
<PAGE>
AMSOUTH MUTUAL FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
(Amounts in Thousands)
<TABLE>
<CAPTION>
FLORIDA TAX-FREE MUNICIPAL
FUND BOND FUND
------------------ ---------
FOR THE
YEAR YEAR PERIOD
ENDED ENDED ENDED
JULY 31, JULY 31, JULY 31,
1997 1996 1997 (A)
-------- -------- ---------
<S> <C> <C> <C>
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income.......................... $ 2,278 $ 2,117 $ 1,196
Net realized gains (losses) from investment
transactions.................................. 135 97 21
Net change in unrealized
appreciation/depreciation from investments.... 1,102 (169) 5,152
------- -------- --------
Change in net assets resulting from operations... 3,515 2,045 6,369
------- -------- --------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income..................... (2,402) (2,107) (1,196)
In excess of net investment income............. -- -- (5)
From net realized gains from investment
transactions.................................. (74) (20) --
------- -------- --------
Change in net assets from shareholder
distributions................................... (2,476) (2,127) (1,201)
------- -------- --------
CAPITAL TRANSACTIONS:
Proceeds from shares issued (See Note 8)....... 12,780 10,538 342,930
Dividends reinvested........................... 213 134 --
Cost of shares redeemed........................ (9,213) (10,054) (10,165)
------- -------- --------
Change in net assets from share transactions..... 3,780 618 332,765
------- -------- --------
Change in net assets............................. 4,819 536 337,933
NET ASSETS:
Beginning of period............................ 48,869 48,333 --
------- -------- --------
End of period.................................. $53,688 $ 48,869 $337,933
======= ======== ========
SHARE TRANSACTIONS:
Issued......................................... 1,240 1,023 34,283
Reinvested..................................... 21 13 --
Redeemed....................................... (894) (974) (1,004)
------- -------- --------
Change in shares................................. 367 62 33,279
======= ======== ========
</TABLE>
- --------
(a) For the period from July 1, 1997 (commencement of operations) to July 31,
1997.
See notes to financial statements.
-32-
<PAGE>
AMSOUTH MUTUAL FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
(Amounts in Thousands)
<TABLE>
<CAPTION>
PRIME OBLIGATIONS FUND U.S. TREASURY FUND TAX-EXEMPT FUND
------------------------ ---------------------- --------------------
YEAR YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
JULY 31, JULY 31, JULY 31, JULY 31, JULY 31, JULY 31,
1997 1996 1997 1996 1997 1996
----------- ----------- --------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income. $ 28,798 $ 30,615 $ 15,237 $ 19,129 $ 2,474 $ 2,068
Net realized gains
(losses) from
investment
transactions......... -- -- -- -- (2) --
----------- ----------- --------- ----------- --------- ---------
Change in net assets
resulting from
operations............. 28,798 30,615 15,237 19,129 2,472 2,068
----------- ----------- --------- ----------- --------- ---------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment
income:
Classic Shares (a).... (5,860) (1,925) (497) (204) (605) (140)
Premier Shares (a).... (22,938) (28,690) (14,740) (18,925) (1,869) (1,928)
----------- ----------- --------- ----------- --------- ---------
Change in net assets
from shareholder
distributions.......... (28,798) (30,615) (15,237) (19,129) (2,474) (2,068)
----------- ----------- --------- ----------- --------- ---------
CAPITAL TRANSACTIONS:
Proceeds from shares
issued (See Note 8).. 1,618,418 1,554,362 861,771 1,097,998 201,701 138,969
Dividends reinvested.. 7,378 7,423 876 1,973 590 531
Cost of shares
redeemed............. (1,701,420) (1,575,841) (923,826) (1,042,485) (179,661) (136,413)
----------- ----------- --------- ----------- --------- ---------
Change in net assets
from share
transactions........... (75,624) (14,056) (61,179) 57,486 22,630 3,087
----------- ----------- --------- ----------- --------- ---------
Change in net assets.... (75,624) (14,056) (61,179) 57,486 22,628 3,087
NET ASSETS:
Beginning of period... 603,617 617,673 380,425 322,939 60,727 57,640
----------- ----------- --------- ----------- --------- ---------
End of period......... $ 527,993 $ 603,617 $ 319,246 $ 380,425 $ 83,355 $ 60,727
=========== =========== ========= =========== ========= =========
SHARE TRANSACTIONS:
Issued................ 1,618,418 1,554,362 861,771 1,097,998 201,701 138,969
Reinvested............ 7,378 7,423 876 1,973 590 531
Redeemed.............. (1,701,420) (1,575,841) (923,826) (1,042,485) (179,661) (136,413)
----------- ----------- --------- ----------- --------- ---------
Change in shares........ (75,624) (14,056) (61,179) 57,486 22,630 3,087
=========== =========== ========= =========== ========= =========
</TABLE>
- --------
(a) Effective April 1, 1996 the Funds' existing shares, which were previously
unclassified, were designated Premier Shares and the Fund commenced
offering Classic Shares.
See notes to financial statements.
-33-
<PAGE>
AMSOUTH MUTUAL FUNDS
REGIONAL EQUITY FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
------ ------------------------------------------------------------- --------
<C> <S> <C>
COMMON STOCKS (93.9%):
Air Freight (2.6%):
60 Federal Express Corp. (b).................................... $ 3,874
--------
Apparel (2.6%):
80 Delta Woodside Industries, Inc. (b).......................... 465
120 Russell Corp. ............................................... 3,503
--------
3,968
--------
Automotive Parts (3.4%):
105 Discount Auto Parts, Inc. (b)................................ 2,153
90 Genuine Parts Co. ........................................... 2,936
--------
5,089
--------
Banking (10.0%):
70 Deposit Guaranty Corp. ...................................... 2,293
50 First Commerce Corp. ........................................ 2,628
60 First Tennessee National Corp. .............................. 3,120
35 First Union Corp. ........................................... 3,550
48 NationsBank Corp. ........................................... 3,417
--------
15,008
--------
Building Materials (2.0%):
110 Interface, Inc. ............................................. 3,039
--------
Chemicals--Specialty (1.8%):
300 Ethyl Corp. ................................................. 2,719
--------
Construction--Manufactured Homes (2.3%):
215 Clayton Homes, Inc. ......................................... 3,413
--------
Electronic & Electrical (2.5%):
180 Scientific-Atlanta, Inc. .................................... 3,780
--------
Food Processing & Packaging (4.6%):
218 Flowers Industries, Inc. .................................... 3,793
155 Lance, Inc. ................................................. 3,061
--------
6,854
--------
Forest & Paper Products (3.8%):
80 Caraustar Industries, Inc. .................................. 2,440
80 James River Corp. of Virginia................................ 3,295
--------
5,735
--------
Furniture (0.9%):
105 Winsloew Furniture, Inc. (b)................................. 1,312
--------
Insurance (4.2%):
85 Equifax, Inc. ............................................... 2,885
</TABLE>
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
------ ------------------------------------------------------------- --------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
Insurance, continued:
63 Vesta Insurance Group, Inc. ................................. $ 3,355
--------
6,240
--------
Manufacturing (2.2%):
110 Wolverine Tube, Inc. (b)..................................... 3,231
--------
Medical Services (15.5%):
240 Coventry Corp. (b)........................................... 4,245
152 Health Management Assoc., Inc., Class A (b).................. 4,851
400 HEALTHSOUTH Corp. (b)........................................ 10,600
150 MedPartners, Inc. (b)........................................ 3,562
--------
23,258
--------
Oil & Gas Exploration, Production, & Services (3.2%):
40 Louisiana Land & Exploration Co. ............................ 2,825
26 Mobil Corp. ................................................. 1,989
--------
4,814
--------
Oilfield Equipment & Services (6.3%):
40 Camco International, Inc. ................................... 2,585
125 McDermott International, Inc. ............................... 3,820
150 Offshore Logistics, Inc. (b)................................. 2,963
--------
9,368
--------
Printing (1.3%):
100 John H. Harland Co. ......................................... 1,963
--------
Railroad (2.2%):
30 Norfolk Southern Corp. ...................................... 3,322
--------
Restaurants (2.5%):
130 Cracker Barrel Old Country Store, Inc. ...................... 3,721
--------
Retail (5.3%):
200 Books-A-Million, Inc. (b).................................... 975
190 Hancock Fabrics, Inc. ....................................... 2,482
150 Stein Mart, Inc. (b)......................................... 4,406
--------
7,863
--------
Services (Non-Financial) (0.2%):
17 Rollins, Inc. ............................................... 346
--------
Steel (4.0%):
125 Birmingham Steel Corp. ...................................... 2,273
60 Nucor Corp. ................................................. 3,724
--------
5,997
--------
</TABLE>
Continued
-34-
<PAGE>
AMSOUTH MUTUAL FUNDS
REGIONAL EQUITY FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
------ ------------------------------------------------------------- --------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
Temporary Services (2.3%):
125 AccuStaff, Inc. (b).......................................... $ 3,406
--------
Transportation Leasing & Trucking (2.2%):
90 Ryder System, Inc. .......................................... 3,223
--------
Utilities--Electric (3.8%):
80 Florida Progress Corp. ...................................... 2,575
145 Southern Co. ................................................ 3,181
--------
5,756
--------
Utilities--Telecommunications (2.2%):
70 BellSouth Corp. ............................................. 3,316
--------
Total Common Stocks (Cost--$88,357) 140,615
--------
</TABLE>
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
------ ------------------------------------------------------------- --------
<C> <S> <C>
INVESTMENT COMPANIES (6.1%):
7,056 AmSouth Prime Obligations Fund............................... $ 7,056
2,129 AmSouth U.S. Treasury Fund................................... 2,129
--------
Total Investment Companies (Cost--$9,185) 9,185
--------
Total (Cost--$97,543) (a) $149,800
========
</TABLE>
- --------
Percentages indicated are based on net assets of $149,838.
(a) Represents cost for federal income tax purposes and differs from value by
net unrealized appreciation of securities as follows:
<TABLE>
<S> <C>
Unrealized appreciation........ $55,621
Unrealized depreciation........ (3,364)
-------
Net unrealized appreciation.... $52,257
=======
</TABLE>
(b) Represents non-income producing securities.
See notes to financial statements.
-35-
<PAGE>
AMSOUTH MUTUAL FUNDS
EQUITY FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ---------------------------------------------------------- --------
<C> <S> <C>
COMMON STOCKS (96.7%):
Apparel (0.9%):
600 Phillips-Van Heusen Corp. ................................ $ 8,400
--------
Automobiles (2.3%)
550 Ford Motor Co. ........................................... 22,481
--------
Automotive Parts (1.4%):
392 Arvin Industries, Inc. ................................... 13,647
--------
Banking (6.7%):
150 J.P. Morgan & Co., Inc. .................................. 17,381
230 NationsBank Corp. ........................................ 16,373
450 Washington Mutual, Inc. .................................. 31,106
--------
64,860
--------
Chemicals--Specialty (2.0%):
930 Engelhard Corp. .......................................... 19,995
--------
Computers & Peripherals (1.7%):
156 International Business Machines Corp. .................... 16,497
--------
Construction (0.4%):
245 Ryland Group, Inc. ....................................... 4,043
--------
Consumer Goods (1.3%):
390 American Greetings Corp., Class A......................... 13,065
--------
Containers (1.8%):
660 Rubbermaid, Inc. ......................................... 17,201
--------
Electronic & Electrical (3.7%):
525 AMP, Inc. ................................................ 27,431
128 Avnet, Inc. .............................................. 8,391
--------
35,822
--------
Financial Services (3.4%):
181 American Express Co. ..................................... 15,159
660 Dun & Bradstreet Corp. ................................... 17,820
--------
32,979
--------
Food Processing & Packaging (4.5%):
544 Grand Metropolitan PLC, ADR............................... 21,778
510 Sara Lee Corp. ........................................... 22,344
--------
44,122
--------
Forest & Paper Products (2.9%):
460 Weyerhauser Co. .......................................... 28,635
--------
Health Care (3.5%):
205 Aetna, Inc. .............................................. 23,357
</TABLE>
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ---------------------------------------------------------- --------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
Health Care, continued:
185 United Healthcare Corp. .................................. $ 10,545
--------
33,902
--------
Insurance-Broker (1.9%):
240 Marsh & McLennan Cos., Inc. .............................. 18,585
--------
Insurance--Property, Casualty, Health & Other (2.6%):
325 St. Paul Cos., Inc. ...................................... 25,492
--------
Manufacturing (0.5%):
104 Kennametal, Inc. ......................................... 5,002
--------
Medical Supplies (3.0%):
270 Bard (C.R.), Inc. ........................................ 10,159
335 Baxter International, Inc. ............................... 19,367
--------
29,526
--------
Newspapers (4.2%):
467 Dow Jones & Co., Inc. .................................... 20,147
213 Gannett Co., Inc. ........................................ 21,154
--------
41,301
--------
Oil & Gas Exploration, Production & Services (8.5%):
275 Burlington Resources, Inc. ............................... 12,994
750 Sun Co., Inc. ............................................ 26,859
196 Texaco, Inc. ............................................. 22,748
630 USX--Marathon Group....................................... 20,278
--------
82,879
--------
Oilfield Equipment & Services (2.3%):
250 Dresser Industries, Inc. ................................. 10,438
385 McDermott International, Inc. ............................ 11,767
--------
22,205
--------
Pharmaceuticals (5.5%):
220 American Home Products Corp. ............................. 18,136
165 Bristol-Myers Squibb Co. ................................. 12,942
600 Pharmacia & Upjohn, Inc. ................................. 22,650
--------
53,728
--------
Pollution Control Services & Equipment (1.7%):
510 Waste Management, Inc. ................................... 16,320
--------
Railroad (1.8%):
290 CSX Corp. ................................................ 17,908
--------
</TABLE>
Continued
-36-
<PAGE>
AMSOUTH MUTUAL FUNDS
EQUITY FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ---------------------------------------------------------- --------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
Retail (14.2%):
435 CVS Corp. ................................................ $ 24,741
345 Dayton Hudson Corp. ...................................... 22,296
540 Dillard's, Inc., Class A.................................. 20,419
475 Gap, Inc. ................................................ 21,108
375 May Department Store, Inc. ............................... 20,953
770 Wal-Mart Stores, Inc. .................................... 28,923
--------
138,440
--------
Services (Non-Financial) (1.2%):
232 Cognizant Corp. .......................................... 9,889
75 Reynolds & Reynolds Co., Class A.......................... 1,453
--------
11,342
--------
Temporary Services (1.0%):
510 Olsten Corp. ............................................. 9,435
--------
Transportation Leasing & Trucking (2.4%):
435 Ryder System, Inc. ....................................... 15,578
243 USFreightways Corp. ...................................... 7,548
--------
23,126
--------
Transportation--Marine (0.2%):
120 Kirby Corp. (b)........................................... 2,250
--------
</TABLE>
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ---------------------------------------------------------- --------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
Utilities--Electric & Gas (2.8%):
515 Baltimore Gas & Electric Co. ............................. $ 14,323
590 Southern Co. ............................................. 12,943
--------
27,266
--------
Utilities--Telecommunications (6.4%):
425 AT&T Corp. ............................................... 15,645
356 BellSouth Corp. .......................................... 16,866
256 NYNEX Corp. .............................................. 14,192
315 Sprint Corp. ............................................. 15,593
--------
62,296
--------
Total Common Stocks (Cost--$590,219) 942,750
--------
COMMERCIAL PAPER (1.1%):
11,189 Merrill Lynch & Co., Inc., 5.50%, 8/1/97.................. 11,189
--------
Total Commercial Paper (Cost--$11,189) 11,189
--------
INVESTMENT COMPANIES (2.2%):
15,432 AmSouth Prime Obligations Fund............................ 15,432
6,385 AmSouth U.S. Treasury Fund................................ 6,385
--------
Total Investment Companies (Cost--$21,817) 21,817
--------
Total (Cost--$623,225) (a) $975,756
========
</TABLE>
- --------
Percentages indicated are based on net assets of $974,985.
(a) Represents cost for financial reporting purposes and differs from cost
basis for federal income tax reporting purposes by the amount of losses
recognized for financial reporting purposes in excess of federal income
tax reporting of approximately $177. Cost for federal income tax purposes
differs from value by net unrealized appreciation of securities as
follows:
<TABLE>
<S> <C>
Unrealized appreciation....... $356,163
Unrealized depreciation....... (3,632)
--------
Net unrealized appreciation... $352,531
========
</TABLE>
(b) Represents non-income producing securities.
ADR--American Depository Receipt
PLC--Public Limited Co.
See notes to financial statements.
-37-
<PAGE>
AMSOUTH MUTUAL FUNDS
EQUITY INCOME FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
July 31, 1997
Amounts in Thousands (except Shares)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ----------------------------------------------------------- -------
<C> <S> <C>
COMMON STOCKS (67.1%):
Aerospace/Defense (1.7%):
4,400 General Dynamics Corp. .................................... $ 389
-------
Aluminum (1.5%):
4,300 Reynolds Metals Co. ....................................... 335
-------
Automobiles (1.6%):
8,500 Ford Motor Co. ............................................ 347
-------
Banking (8.6%):
13,300 Banc One Corp. ............................................ 747
4,200 Bankers' Trust New York (b)................................ 425
3,200 J.P. Morgan & Co., Inc. ................................... 371
7,200 Mellon Bank Corp. ......................................... 363
-------
1,906
-------
Chemicals--Specialty (2.2%):
7,800 PPG Industries, Inc. ...................................... 499
-------
Computers & Peripherals (1.5%):
4,700 Hewlett-Packard Co. ....................................... 329
-------
Diversified (2.0%):
6,400 General Electric Co. ...................................... 449
-------
Electronic--Semiconductors (1.3%):
9,200 National Semiconductor Corp. (b)........................... 290
-------
Electrical Equipment (2.5%):
9,400 Emerson Electric Co. ...................................... 555
-------
Electronic & Electrical (1.7%):
5,800 Avnet, Inc. ............................................... 382
-------
Financial Services (0.5%):
2,500 Federal National Mortgage Assoc. .......................... 118
-------
Food Distributors & Wholesalers (0.6%):
5,000 International Multifoods Corp. ............................ 141
-------
Food Processing & Packaging (3.3%):
6,500 General Mills, Inc. ....................................... 449
6,200 H.J. Heinz Co. ............................................ 286
-------
735
-------
Health Care (2.2%):
7,700 Johnson & Johnson.......................................... 480
-------
Household Goods--Appliances, Furnishings, Etc. (2.6%):
19,700 Maytag Corp. .............................................. 575
-------
</TABLE>
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ----------------------------------------------------------- -------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
Office Equipment & Supplies (2.7%):
8,100 Pitney Bowes, Inc. ........................................ $ 609
-------
Oil--Integrated (4.6%):
4,250 Amoco Corp. ............................................... 400
5,100 Equitable Resources, Inc. ................................. 152
7,400 Exxon Corp. ............................................... 475
-------
1,027
-------
Pharmaceuticals (7.2%):
7,900 American Home Products Corp. .............................. 651
3,500 Glaxo Wellcome PLC ADR (b)................................. 149
4,200 Merck & Co., Inc. ......................................... 437
9,900 Pharmacia & Upjohn, Inc. .................................. 374
-------
1,611
-------
Railroad (1.3%):
3,900 Union Pacific Corp. ....................................... 280
-------
Restaurants (1.6%):
6,750 McDonald's Corp. .......................................... 363
-------
Retail (4.4%):
7,500 J.C. Penney Co., Inc. ..................................... 439
9,700 May Department Stores Co. ................................. 542
-------
981
-------
Soaps & Cleaning Agents (0.6%):
1,700 Colgate-Palmolive, Inc. ................................... 129
-------
Steel (1.6%):
11,500 Allegheny Teledyne, Inc. .................................. 358
-------
Tobacco & Tobacco Products (1.7%):
8,450 Philip Morris Cos., Inc. .................................. 381
-------
Utilities--Electric & Gas (2.3%):
3,335 Duke Energy Corp. (b)...................................... 169
10,100 Pacific Enterprises........................................ 338
-------
507
-------
Utilities--Telecommunications (5.3%):
3,099 SBC Communications, Inc. .................................. 183
12,700 Sprint Corp. .............................................. 629
10,000 U.S. West Communications Group............................. 366
-------
1,178
-------
Total Common Stocks (Cost--$13,794) 14,954
-------
</TABLE>
Continued
-38-
<PAGE>
AMSOUTH MUTUAL FUNDS
EQUITY INCOME FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
July 31, 1997
Amounts in Thousands (except Shares)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ----------------------------------------------------------- -------
<C> <S> <C>
CONVERTIBLE PREFERRED STOCKS (20.9%):
Banking (3.2%):
24,400 National Australia Bank, Callable 3/19/07
@ $25..................................................... $ 717
-------
Computers--Software (2.1%):
5,200 Microsoft Corp., Series A.................................. 459
-------
Fertilizer (2.0%):
12,800 Merrill Lynch & Co., Inc./IMC Global (STRYPES)**........... 449
-------
Financial Services (4.3%):
4,400 Jefferson Pilot/Nations Bank*.............................. 535
4,900 MCN Financing III.......................................... 268
1,700 Merrill Lynch & Co., Inc./MGIC (STRYPES)***................ 151
-------
954
-------
Food Processing & Packaging (4.3%):
12,900 Dole Food (TRACES)......................................... 522
7,000 Ralston Purina Group/Interstate Bakeries (b)............... 436
-------
958
-------
Machinery--Construction (1.6%):
2,400 Case Corp., Series A, Callable 7/1/99
@ $51.29 (c).............................................. 360
-------
Oil Refining & Marketing (1.5%):
5,600 Tosco Financial Trust (c).................................. 325
-------
Publishing--Newspapers (1.9%):
37,500 Hollinger International, Inc., Callable 8/1/99 @ $9.99..... 436
-------
Total Convertible Preferred Stocks (Cost--$3,916) 4,658
-------
</TABLE>
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ---------------------------------------------------------- -------
<C> <S> <C>
CONVERTIBLE BONDS (10.1%):
Electronic Components (3.9%):
$120 SCI Systems, Inc., 5.00%, 5/1/06, Callable 5/1/99 @ 103.5
(c)...................................................... $ 209
490 Solectron Corp., 6.00%, 3/1/06, Callable 3/3/99 @ 104.2
(c)...................................................... 658
-------
867
-------
Electronic--Semiconductors (1.2%):
260 National Semiconductor Corp., 6.50%, 10/1/02, Callable
10/3/98 @ 103.71 (c)..................................... 274
-------
Medical--Hospitals (1.9%):
350 Tenet Healthcare Corp., 6.00%, 12/1/05, Callable 1/15/99 @
103****.................................................. 424
-------
Oilfield Equipment & Services (3.1%):
270 Diamond Offshore Drilling, Inc., 3.75%, 2/15/07, Callable
2/22/01 @ 102.08......................................... 352
300 Parker Drilling Corp., 5.50%, 8/1/04, Callable 8/1/00 @
103.14................................................... 330
-------
682
-------
Total Convertible Bonds (Cost--$2,007) 2,247
-------
INVESTMENT COMPANY (2.3%):
504,942 AmSouth Prime Obligations Fund............................ 505
-------
Total Investment Company (Cost--$505) 505
-------
Total (Cost--$20,222) (a) $22,364
=======
</TABLE>
- --------
Percentages indicated are based on net assets of $22,273.
(a) Represents cost for federal income tax purposes and differs from value by
net unrealized appreciation of securities as follows:
<TABLE>
<S> <C>
Unrealized appreciation......... $2,223
Unrealized depreciation......... (81)
------
Net unrealized appreciation..... $2,142
======
</TABLE>
(b) Represents non-income producing security.
(c) Section 144A security which is restricted as to resale to institutional
investors.
* At maturity, convertible to shares of NationsBank common stock.
** At maturity, convertible to shares of IMC Global, Inc. common stock.
*** At maturity, convertible to shares of MGIC Investment Corp. common stock.
**** Convertible beginning 11/6/97 into common shares of Vencor, Inc.
ADR--American Depository Receipt
PLC--Public Limited Co.
STRYPES--Structured Yield Product Exchangeable for Stock
TRACES--Trust Automatic Common Exchange Securities
See notes to financial statements.
-39-
<PAGE>
AMSOUTH MUTUAL FUNDS
BALANCED FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- --------------------------------------------------------- --------
<C> <S> <C>
CORPORATE BONDS (20.0%):
Appliances (0.1%):
$ 500 Whirlpool Corp., 9.50%, 6/15/00.......................... $ 543
--------
Automotive (0.6%):
1,430 Ford Capital B.V., 9.13%, 5/1/98 (Guaranteed by Ford
Motor Co.).............................................. 1,467
700 General Motors Corp., 9.63%, 12/1/00..................... 770
--------
2,237
--------
Banking (3.3%):
930 BankAmerica Corp., 9.50%, 4/1/01......................... 1,026
1,000 Bankers Trust Co., 9.50%, 6/14/00........................ 1,084
2,500 Mellon Financial Co., 6.30%, 6/1/00 (Guaranteed By Mellon
Bank Corp.)............................................. 2,506
4,185 NationsBank Corp., 5.38%, 4/15/00........................ 4,107
2,000 SunTrust Banks, Inc., 7.38%, 7/1/06...................... 2,100
1,475 Wachovia Corp., 6.63%, 11/15/06.......................... 1,481
--------
12,304
--------
Brokerage Services (3.3%):
3,000 Bear Stearns & Co., Inc., 6.50%, 8/1/02.................. 3,004
4,000 Dean Witter Discover & Co., 6.00%, 3/1/98................ 4,011
2,000 Merrill Lynch & Co., Inc., 6.00%, 3/1/01................. 1,985
1,000 Morgan Stanley Group, Inc., 9.25%,
3/1/98.................................................. 1,021
2,000 Morgan Stanley Group, Inc., 8.10%, 6/24/02............... 2,145
--------
12,166
--------
Entertainment (0.3%):
1,000 Columbia Picture Entertainment, Inc., 9.88%, 2/1/98...... 1,017
--------
Financial--Commercial (1.1%):
4,000 Associates Corp. N. A., 6.75%, 7/15/01................... 4,070
--------
Financial Services (1.3%):
1,000 American General Finance Corp., 7.70%, 11/15/97.......... 1,006
500 Beneficial Corp., 9.90%, 11/17/97........................ 506
1,200 British Telecom Finance, Inc., 9.38%, 2/15/99 (Guaranteed
by British Telecommunications PLC)...................... 1,262
1,000 Commercial Credit Co., 7.88%, 7/15/04.................... 1,077
1,000 Ford Motor Credit Corp., 5.63%, 1/15/99.................. 998
--------
4,849
--------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- --------------------------------------------------------- --------
<C> <S> <C>
CORPORATE BONDS, CONTINUED:
Food Products (0.3%):
$ 1,000 H.J. Heinz Co., 6.75%, 10/15/99.......................... $ 1,017
--------
Forest & Paper Products (0.3%):
1,000 Mead Corp., 6.60%, 3/1/02................................ 1,010
--------
Industrial Goods & Services (3.9%):
500 Browning-Ferris Industries, Inc., 6.10%, 1/15/03......... 492
1,000 Dresser Industries, Inc., 6.25%, 6/1/00.................. 1,005
3,000 First Data Corp., 6.75%, 7/15/05......................... 3,053
2,000 Gannett Co., Inc., 5.85%, 5/1/00......................... 1,990
2,000 Honeywell, Inc., 6.75%, 3/15/02.......................... 2,032
3,000 Monsanto Co., 6.00%, 7/1/00.............................. 2,992
1,000 Waste Management, Inc., 8.25%, 11/15/99.................. 1,045
2,000 Waste Management, Inc., 7.70%, 10/1/02................... 2,105
--------
14,714
--------
Insurance (1.1%):
1,000 Allstate Corp., 5.88%, 6/15/98........................... 1,002
1,400 Capital Holding Corp., 9.20%, 4/17/01.................... 1,531
420 Chubb Corp., 8.75%, 11/15/99............................. 444
1,200 Torchmark Corp., 9.63%, 5/1/98........................... 1,233
--------
4,210
--------
Oil & Gas Exploration & Production Services (0.4%):
1,550 BP America, Inc., 9.38%, 11/1/00 (Guaranteed by British
Petroleum Co. PLC)...................................... 1,695
--------
Pharmaceuticals (0.3%):
1,000 McKesson Corp., 8.63%, 2/1/98............................ 1,013
--------
Retail Stores (1.1%):
2,000 J.C. Penney Co., Inc., 7.25%, 4/1/02..................... 2,070
2,000 Wal-Mart Stores, Inc., 6.75%, 5/15/02.................... 2,045
--------
4,115
--------
Telecommunications (0.5%):
1,730 Lucent Technologies, Inc., 6.90%, 7/15/01................ 1,769
--------
Utility--Electric (2.1%):
3,450 Duke Power Co., 7.00%, 6/1/00............................ 3,528
1,275 Georgia Power Co., 6.13%, 9/1/99......................... 1,277
2,000 Oklahoma Gas & Electric, 6.25%,
10/15/00................................................ 2,007
</TABLE>
Continued
-40-
<PAGE>
AMSOUTH MUTUAL FUNDS
BALANCED FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ---------------------------------------------------------- --------
<C> <S> <C>
CORPORATE BONDS, CONTINUED:
Utility--Electric, continued:
$ 900 Pennsylvania Power & Light Co., 6.00%, 6/1/00............. $ 897
--------
7,709
--------
Total Corporate Bonds (Cost--$73,650) 74,438
--------
U.S. TREASURY BONDS (11.2%):
11,000 7.50%, 11/15/16........................................... 12,387
10,000 7.25%, 8/15/22............................................ 11,074
18,500 6.25%, 8/15/23............................................ 18,230
--------
Total U.S. Treasury Bonds (Cost--$37,460) 41,691
--------
U.S. GOVERNMENT AGENCIES (2.4%):
7,000 Federal Home Loan Mortgage Corp., 5.83%, 2/9/06........... 6,797
2,000 Federal Home Loan Mortgage Corp., 7.10%, 4/10/07.......... 2,121
--------
Total U.S. Government Agencies (Cost--$8,386) 8,918
--------
U.S. TREASURY NOTES (7.5%):
3,000 6.25%, 6/30/02............................................ 3,041
13,300 5.75%, 8/15/03............................................ 13,178
12,000 5.88%, 11/15/05........................................... 11,863
--------
Total U.S. Treasury Notes (Cost--$27,349) 28,082
--------
U.S. TREASURY STRIPS (2.2%):
12,000 2/15/04................................................... 8,153
--------
Total U.S. Treasury Strips (Cost--$7,874) 8,153
--------
COMMON STOCKS (54.3%):
Apparel (0.5%):
140 Phillips-Van Heusen Corp. ................................ 1,960
--------
Automobiles (1.5%):
135 Ford Motor Co. ........................................... 5,518
--------
Automotive Parts (1.0%):
101 Arvin Industries, Inc. ................................... 3,516
--------
Banking (2.6%):
40 J.P. Morgan & Co., Inc. .................................. 4,635
70 NationsBank Corp. ........................................ 4,983
--------
9,618
--------
</TABLE>
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
------ ------------------------------------------------------------- --------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
Chemicals-Specialty (0.9%):
160 Engelhard Corp. ............................................. $ 3,440
--------
Computers & Peripherals (0.6%):
20 International Business Machines Corp. ....................... 2,115
--------
Consumer Goods (0.6%):
60 American Greetings Corp., Class A............................ 2,010
--------
Containers (0.9%):
125 Rubbermaid, Inc. ............................................ 3,258
--------
Electronic & Electrical (2.5%):
140 AMP, Inc. ................................................... 7,315
32 Avnet, Inc. ................................................. 2,106
--------
9,421
--------
Financial Services (3.5%):
45 American Express Co. ........................................ 3,769
110 Dun & Bradstreet Corp. ...................................... 2,970
90 Washington Mutual, Inc. ..................................... 6,221
--------
12,960
--------
Food Processing & Packaging (2.5%):
100 Grand Metropolitan PLC, ADR.................................. 4,000
120 Sara Lee Corp. .............................................. 5,258
--------
9,258
--------
Forest & Paper Products (1.5%):
90 Weyerhauser Co. ............................................. 5,602
--------
Health Care (2.1%):
50 Aetna, Inc. ................................................. 5,697
35 United Healthcare Corp. ..................................... 1,995
--------
7,692
--------
Insurance--Broker (0.8%):
40 Marsh & McLennan Cos., Inc. ................................. 3,097
--------
Insurance--Property, Casualty, Health & Other (1.4%):
65 St. Paul Cos., Inc. ......................................... 5,098
--------
Manufacturing (0.4%):
31 Kennametal, Inc. ............................................ 1,494
--------
Medical Supplies (1.6%):
45 Bard (C.R.), Inc. ........................................... 1,693
100 Baxter International, Inc. .................................. 5,781
--------
7,474
--------
</TABLE>
Continued
-41-
<PAGE>
AMSOUTH MUTUAL FUNDS
BALANCED FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
------ ------------------------------------------------------------- --------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
Newspapers (2.4%):
90 Dow Jones & Co., Inc. ....................................... $ 3,887
50 Gannett Co., Inc. ........................................... 4,966
--------
8,853
--------
Oil & Gas Exploration, Production, & Services (5.0%):
60 Burlington Resources, Inc. .................................. 2,835
180 Sun Co., Inc. ............................................... 6,446
40 Texaco, Inc. ................................................ 4,643
150 USX--Marathon Group.......................................... 4,828
--------
18,752
--------
Oilfield Equipment & Services (1.5%):
75 Dresser Industries, Inc. .................................... 3,131
75 McDermott International, Inc. ............................... 2,292
--------
5,423
--------
Pharmaceuticals (3.1%):
60 American Home Products Corp. ................................ 4,946
30 Bristol-Myers Squibb Co. .................................... 2,353
114 Pharmacia & Upjohn, Inc. .................................... 4,304
--------
11,603
--------
Pollution Control Services & Equipment (1.0%):
115 Waste Management, Inc. ...................................... 3,680
--------
Railroad (0.8%):
50 CSX Corp. ................................................... 3,088
--------
Retail (7.5%):
100 CVS Corp. ................................................... 5,688
54 Dayton Hudson Corp. ......................................... 3,490
105 Dillard Department Stores, Inc., Class A..................... 3,970
120 Gap, Inc. ................................................... 5,333
70 May Department Stores Co. ................................... 3,911
150 Wal-Mart Stores, Inc. ....................................... 5,634
--------
28,026
--------
</TABLE>
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
------ ------------------------------------------------------------- --------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
Services (Non-Financial) (0.6%):
48 Cognizant Corp. ............................................. $ 2,046
--------
Temporary Services (0.5%):
97 Olsten Corp. ................................................ 1,794
--------
Transportation Leasing & Trucking (1.3%):
85 Ryder Systems, Inc. ......................................... 3,044
55 US Freightways Corp. ........................................ 1,708
--------
4,752
--------
Transportation--Marine (0.2%):
30 Kirby Corp. (b).............................................. 563
--------
Utilities--Electric (1.5%):
110 Baltimore Gas & Electric Co. ................................ 3,059
115 Southern Co. ................................................ 2,523
--------
5,582
--------
Utilities--Telecommunications (4.0%):
60 AT&T Corp. .................................................. 2,209
90 BellSouth Corp. ............................................. 4,264
80 NYNEX Corp. ................................................. 4,435
80 Sprint Corp. ................................................ 3,960
--------
14,868
--------
Total Common Stocks (Cost--$121,130) 202,561
--------
INVESTMENT COMPANIES (1.8%):
6,681 AmSouth Prime Obligations Fund............................... 6,681
5 AmSouth U.S. Treasury Fund................................... 5
--------
Total Investment Companies (Cost--$6,686) 6,686
--------
Total (Cost--$282,535) (a) $370,529
========
</TABLE>
- --------
Percentages indicated are based on net assets of $372,769.
(a) Represents cost for federal income tax purposes and differs from value by
net unrealized appreciation of securities as follows:
<TABLE>
<S> <C>
Unrealized appreciation........ $89,043
Unrealized depreciation........ (1,049)
-------
Net unrealized appreciation.... $87,994
=======
</TABLE>
(b) Represents non-income producing securities.
ADR--American Depository Receipt
PLC--Public Limited Co.
See notes to financial statements.
-42-
<PAGE>
AMSOUTH MUTUAL FUNDS
BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- --------------------------------------------------------- --------
<C> <S> <C>
CORPORATE BONDS (38.3%):
Appliances (0.2%):
$ 500 Whirlpool Corp., 9.50%, 6/15/00.......................... $ 543
--------
Automotive (1.7%):
4,070 Ford Capital B.V., 9.13%, 5/1/98 (Guaranteed by Ford
Motor Co.).............................................. 4,175
908 General Motors Corp., 9.63%, 12/1/00..................... 999
--------
5,174
--------
Banking (6.3%):
1,475 Banc One Corp., 7.00%, 7/15/05........................... 1,507
1,150 BankAmerica Corp., 9.50%, 4/1/01......................... 1,269
7,000 Bankers Trust Co., 9.50%, 6/14/00........................ 7,586
2,356 J.P. Morgan & Co., 7.63%, 9/15/04........................ 2,515
4,306 NationsBank Corp., 5.38%, 4/15/00........................ 4,225
2,259 SunTrust Banks, Inc., 7.38%, 7/1/06...................... 2,372
--------
19,474
--------
Beverages (1.8%):
2,000 Coca-Cola Enterprises, Inc., 6.38%, 8/1/01............... 2,010
3,530 PepsiCo, Inc., 7.63%, 11/1/98............................ 3,598
--------
5,608
--------
Brokerage Services (2.5%):
1,000 Bear Stearns & Co., Inc., 6.50%, 6/15/00................. 1,009
3,000 Dean Witter Discover & Co., 6.50%, 11/1/05............... 2,974
1,035 Merrill Lynch & Co., Inc., 9.00%, 5/1/98................. 1,061
1,000 Merrill Lynch & Co., Inc., 6.38%, 3/30/99................ 1,006
750 Merrill Lynch & Co., Inc., 8.25%, 11/15/99............... 784
1,025 Morgan Stanley Group, Inc., 9.25%, 3/1/98................ 1,046
--------
7,880
--------
Entertainment (0.3%):
1,000 Columbia Picture Entertainment, Inc., 9.88%, 2/1/98...... 1,017
--------
Financial Services (5.8%):
2,000 American Express Credit Corp., 6.50%, 8/1/00............. 2,020
2,000 Associates Corp., 6.25%, 3/15/99......................... 2,010
2,950 Avco Financial Service Corp., 5.50%, 4/1/00.............. 2,909
500 Beneficial Corp., 9.90%, 11/17/97........................ 506
1,310 British Telecom Finance, Inc., 9.38%, 2/15/99 (Guaranteed
by British Telecommunications PLC)...................... 1,377
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- --------------------------------------------------------- --------
<C> <S> <C>
CORPORATE BONDS, CONTINUED:
Financial Services, continued:
$ 2,000 Commercial Credit Co., 7.38%, 3/15/02.................... $ 2,085
3,000 Commercial Credit Co., 6.50%, 8/1/04..................... 2,998
1,100 Ford Motor Credit Co., 6.25%, 12/8/05.................... 1,074
1,000 Margaretten Financial Corp., 6.75%, 6/15/00.............. 1,010
2,000 Norwest Financial, Inc., 6.63%, 7/15/04.................. 2,026
--------
18,015
--------
Forest & Paper Products (0.3%):
1,000 Mead Corp., 6.60%, 3/1/02................................ 1,010
--------
Industrial Goods & Services (4.4%):
2,655 Browning-Ferris Industries, Inc., 6.10%, 1/15/03......... 2,612
2,570 E. I. Dupont de Nemours & Co., 6.75%, 10/15/02........... 2,621
700 Exxon Capital Corp., 7.45%, 12/15/01..................... 734
2,000 First Data Corp., 6.75%, 7/15/05......................... 2,035
1,390 Illinois Tool Works, Inc., 5.88%, 3/1/00................. 1,383
1,156 Rockwell International Corp., 6.63%, 6/1/05.............. 1,175
1,200 Waste Management, Inc., 6.38%, 12/1/03................... 1,190
2,000 Waste Management, Inc., 7.00%, 5/15/05................... 2,050
--------
13,800
--------
Insurance (2.6%):
1,000 AON Corp., 6.88%, 10/1/99................................ 1,017
1,600 Capital Holding Corp., 9.20%, 4/17/01.................... 1,750
989 Chubb Corp., 8.75%, 11/15/99............................. 1,046
3,000 Hartford Life, Inc., 6.90%, 6/15/04...................... 3,064
1,300 Torchmark Corp., 9.63%, 5/1/98........................... 1,335
--------
8,212
--------
Oil & Gas Exploration & Production Services (0.5%):
1,464 BP America, Inc., 9.38%, 11/1/00 (Guaranteed by British
Petroleum Co. PLC)...................................... 1,601
--------
Pharmaceuticals (0.3%):
1,000 McKesson Corp., 8.63%, 2/1/98............................ 1,013
--------
Railroads (1.1%):
2,395 Union Pacific Corp., 6.25%, 3/15/99...................... 2,401
1,000 Union Pacific Corp., 7.00%, 6/15/00...................... 1,017
--------
3,418
--------
</TABLE>
Continued
-43-
<PAGE>
AMSOUTH MUTUAL FUNDS
BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ------------------------ --------
<C> <S> <C>
CORPORATE BONDS, CONTINUED:
Retail-Discount Stores (0.3%):
$ 1,000 Wal-Mart Stores, Inc.,
6.75%, 5/15/02......... $ 1,023
--------
Utility-Electric (4.5%):
2,000 Consolidated Edison Co.
of New York, Inc.,
6.63%, 2/1/02.......... 2,023
1,000 Northern States Power
Co., 5.50%, 2/1/99..... 994
2,500 Northern States Power
Co., 7.88%, 10/1/01.... 2,650
2,250 Oklahoma Gas & Electric
Co., 6.25%, 10/15/00... 2,258
500 Pacific Gas & Electric
Co., 5.38%, 6/1/98..... 498
1,000 Southern California
Edison Co., 5.60%,
12/15/98............... 996
2,000 Tampa Electric Co.,
6.13%, 5/1/03.......... 1,985
2,500 Virginia Electric &
Power Co., 8.00%,
3/1/04................. 2,713
--------
14,117
--------
Utility-Telephone (5.7%):
1,000 BellSouth
Telecommunications,
Inc., 6.25%, 5/15/03... 997
2,000 GTE California, Inc.,
5.63%, 2/1/01.......... 1,965
2,295 GTE Northwest, Inc.,
Series A, 7.38%,
5/1/01................. 2,381
1,600 GTE Southwest, Inc.,
Series A, 5.82%,
12/1/99................ 1,600
500 Michigan Bell Telephone,
5.88%, 9/15/99......... 501
2,000 Pacific Bell, 6.88%,
8/15/06................ 2,055
2,000 Southern New England
Telecommuni-
cations Corp., 6.50%,
2/15/02................ 2,020
2,000 Southwestern Bell
Telephone, 6.63%,
4/1/05................. 2,020
4,000 U.S. West Communications
Group,
6.63%, 9/15/05......... 4,045
--------
17,584
--------
Total Corporate Bonds (Cost--
$117,021) 119,489
--------
</TABLE>
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ---------------------------------------------------------- --------
<C> <S> <C>
U.S. GOVERNMENT AGENCIES (6.1%):
Federal National Mortgage Assoc.
4,000 7.05%, 11/12/02........................................... $ 4,177
1,500 7.40%, 7/1/04............................................. 1,602
8,200 8.50%, 2/1/05............................................. 8,646
2,300 5.88%, 2/2/06............................................. 2,241
Resolution Trust Funding Corp:
5,000 6.08%, 1/30/10............................................ 2,295
--------
Total U.S. Government Agencies (Cost--$18,480) 18,961
--------
U.S. TREASURY BONDS (52.4%):
5,000 7.50%, 11/15/01........................................... 5,301
29,000 6.38%, 8/15/02............................................ 29,599
36,000 5.75%, 8/15/03............................................ 35,669
21,000 5.88%, 11/15/05........................................... 20,761
6,000 6.50%, 10/15/06........................................... 6,180
2,021 3.38%, 1/15/07**.......................................... 1,987
18,000 7.50%, 11/15/16........................................... 20,270
4,000 7.25%, 8/15/22............................................ 4,429
39,700 6.25%, 8/15/23............................................ 39,122
--------
Total U.S. Treasury Bonds (Cost--$154,622) 163,318
--------
U.S. TREASURY STRIPS (1.7%):
8,000 02/15/04.................................................. 5,435
--------
Total U.S. Treasury Strips (Cost--$5,313) 5,435
--------
MEDIUM TERM NOTE (0.0%):
25 Associates Corp. N.A., 6.00%, 3/15/99..................... 25
--------
Total Medium Term Note (Cost--$25) 25
--------
INVESTMENT COMPANY (1.1%):
3,278 AmSouth Prime Obligations Fund............................ 3,278
--------
Total Investment Company (Cost--$3,278) 3,278
--------
Total (Cost--$298,739) (a) $310,506
========
</TABLE>
- --------
Percentages indicated are based on net assets of $311,881.
(a) Represents cost for financial reporting purposes and differs from cost
basis for federal income tax reporting purposes by the amount of losses
recognized for financial reporting purposes in excess of federal income
tax reporting of approximately $6. Cost for federal income tax purposes
differs from value by net unrealized appreciation of securities as
follows:
<TABLE>
<S> <C>
Unrealized appreciation........ $12,268
Unrealized depreciation........ (501)
-------
Net unrealized appreciation.... $11,767
=======
</TABLE>
**Inflation indexed bonds
PLC--Public Limited Co.
See notes to financial statements.
-44-
<PAGE>
AMSOUTH MUTUAL FUNDS
GOVERNMENT INCOME FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ------------------------------------------------------------ -------
<C> <S> <C>
U.S. GOVERNMENT AGENCIES (78.8%):
Government National Mortgage Assoc.:
$ 54 9.50%, 5/15/18, Pool #237970................................ $ 58
87 9.00%, 6/15/18, Pool #251674................................ 92
109 9.00%, 8/15/18, Pool #256195................................ 115
99 9.50%, 2/15/19, Pool #229511................................ 107
183 9.50%, 6/15/19, Pool #273497................................ 197
15 9.50%, 7/15/19, Pool #272490................................ 17
158 9.00%, 10/15/19, Pool #282314............................... 167
67 9.00%, 10/15/19, Pool #265423............................... 71
64 8.50%, 12/15/19, Pool #192962............................... 66
124 9.00%, 12/15/19, Pool #155126............................... 131
123 9.00%, 1/15/20, Pool #145478................................ 130
65 9.00%, 3/15/20, Pool #281980................................ 69
83 9.00%, 5/15/20, Pool #282467................................ 88
64 9.50%, 5/15/20, Pool #288952................................ 69
283 9.50%, 9/15/20, Pool #287187................................ 304
30 9.50%, 9/15/20, Pool #210730................................ 32
148 8.50%, 11/15/20, Pool #296517............................... 154
74 9.00%, 11/15/20, Pool #293865............................... 79
155 9.50%, 11/15/20, Pool #299157............................... 167
225 9.50%, 11/15/20, Pool #282659............................... 242
9 9.50%, 12/15/20, Pool #297517............................... 9
54 9.50%, 12/15/20, Pool #295078............................... 58
22 9.50%, 1/15/21, Pool #300061................................ 23
431 9.00%, 2/15/21, Pool #295094................................ 456
66 8.50%, 8/15/21, Pool #310782................................ 69
124 8.50%, 8/15/21, Pool #310287................................ 130
209 9.50%, 8/15/21, Pool #306082................................ 225
111 9.00%, 9/15/21, Pool #312637................................ 118
</TABLE>
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ----------------------------------------------------------- -------
<C> <S> <C>
U.S. GOVERNMENT AGENCIES, CONTINUED:
Government National Mortgage Assoc., continued:
$ 53 9.00%, 9/15/21, Pool #312960............................... $ 56
89 8.50%, 10/15/21, Pool #313828.............................. 93
95 9.00%, 10/15/21, Pool #309619.............................. 101
121 9.00%, 1/15/22, Pool #316246............................... 128
25 9.00%, 4/15/22, Pool #312880............................... 27
91 9.00%, 6/15/22, Pool #315171............................... 96
23 9.00%, 9/15/22, Pool #333385............................... 25
13 8.50%, 2/15/23, Pool #343166............................... 13
202 7.50%, 6/15/24, Pool #401000............................... 205
991 7.50%, 7/15/25, Pool #365408............................... 1,008
446 7.50%, 8/15/25, Pool #408478............................... 454
1,848 7.50%, 9/15/25, Pool #377615............................... 1,880
655 7.50%, 9/15/25, Pool #394478............................... 667
31 7.50%, 9/15/25, Pool #365435............................... 32
439 7.50%, 12/15/25, Pool #384943.............................. 446
472 8.00%, 7/15/26, Pool #391645............................... 488
-------
Total U.S. Government Agencies (Cost--$9,152) 9,162
-------
U.S. TREASURY BONDS (19.8%):
700 6.50%, 5/15/05............................................. 720
1,400 7.50%, 11/15/16............................................ 1,577
-------
Total U.S. Treasury Bonds (Cost--$2,071) 2,297
-------
INVESTMENT COMPANY (1.4%):
163 AmSouth U.S. Treasury Fund................................. 163
-------
Total Investment Company (Cost--$163) 163
-------
Total (Cost--$11,386) (a) $11,622
=======
</TABLE>
- --------
Percentages indicated are based on net assets of $11,622.
(a) Represents cost for federal income tax purposes and differs from value by
net unrealized appreciation of securities as follows:
<TABLE>
<S> <C>
Unrealized appreciation........... $269
Unrealized depreciation........... (33)
----
Net unrealized appreciation....... $236
====
</TABLE>
See notes to financial statements.
-45-
<PAGE>
AMSOUTH MUTUAL FUNDS
LIMITED MATURITY FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- --------------------------------------------------------- --------
<C> <S> <C>
CORPORATE BONDS (55.4%):
Banking (7.1%):
$ 2,000 Comerica Bank, 5.95%, 9/15/97............................ $ 2,001
2,000 NationsBank Corp., 5.38%, 4/15/00........................ 1,963
2,500 NationsBank Corp., 5.70%, 9/11/00........................ 2,466
2,500 Norwest Corp., 5.75%, 3/15/98............................ 2,500
900 Wachovia Bank, 6.30%, 3/15/01............................ 904
--------
9,834
--------
Beverages (1.1%):
1,500 PepsiCo, Inc., 5.46%, 7/1/98............................. 1,495
--------
Brokers (2.6%):
2,500 Bear Stearns & Co., Inc., 6.50%, 6/15/00................. 2,522
1,000 Bear Stearns & Co., Inc., 6.05%, 7/5/00.................. 1,009
--------
3,531
--------
Electric Utility (7.3%):
600 Baltimore Gas & Electric Co., 5.50%, 7/15/00............. 590
1,000 Florida Power & Light Co., Series B, 5.70%, 3/5/98....... 1,000
3,000 Florida Power Corp., 6.50%, 12/1/99...................... 3,030
1,000 Georgia Power Co., 5.50%, 4/1/98......................... 1,000
1,500 Georgia Power Co., 6.13%, 9/1/99......................... 1,502
3,000 SCANA Corp., 5.76%, 7/1/98............................... 3,008
--------
10,130
--------
Financial Services (20.0%):
2,000 Associates Corp. of North America, 6.63%, 11/15/97....... 2,007
1,200 Associates Corp. of North America, 7.50%, 5/15/99........ 1,230
3,000 Associates Corp. of North America, 7.25%, 9/1/99......... 3,068
500 Beneficial Corp., 7.32%, 11/17/99........................ 514
3,000 British Gas Finance, 8.75%, 3/15/98 (Guaranteed by
British Gas PLC)........................................ 3,052
1,000 Commercial Credit Co., 8.26%, 11/1/01.................... 1,073
2,000 Dean Witter Discover & Co., 6.26%, 3/15/00............... 2,007
2,000 Deere & Co., Series B, 8.73%, 4/14/98.................... 2,096
1,500 Ford Motor Credit Co., 6.00%, 3/24/98.................... 1,505
1,500 Ford Motor Credit Co., 8.38%, 1/15/00.................... 1,577
4,000 Ford Motor Credit Co., 8.20%, 2/15/02.................... 4,285
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- --------------------------------------------------------- --------
<C> <S> <C>
CORPORATE BONDS, CONTINUED:
Financial Services, continued:
$ 5,000 Household Finance Co., 8.95%, 9/15/99.................... $ 5,275
--------
27,689
--------
Food Products (2.1%):
2,850 Grand Metro Investment, 6.50%,
9/15/99, (Guaranteed by Grand
Metropolitan PLC)....................................... 2,878
--------
Forest & Paper Products (0.7%):
1,000 Mead Corp., 6.60%, 3/1/02................................ 1,010
--------
Gas Utility (1.3%):
1,770 Northern Illinois Gas Co., 5.88%, 5/1/00, Callable 5/1/98
@ 100................................................... 1,748
--------
Industrial Goods & Services (0.6%):
850 Honeywell, Inc., 6.75%, 3/15/02.......................... 864
--------
Insurance (9.0%):
2,625 Allstate Corp., 5.88%, 6/15/98........................... 2,631
2,000 American General Corp., 7.70%, 10/15/99.................. 2,068
1,500 AON Corp., 6.88%, 10/1/99................................ 1,526
2,000 Hartford Financial Services Group, Inc., 8.20%, 10/15/98. 2,056
1,000 St. Paul Cos., Inc., Series A, 6.17%, 1/15/01............ 997
1,000 Travelers, Inc., 6.13%, 6/15/00.......................... 1,000
2,200 USLife Corp., 6.38%, 6/15/00............................. 2,186
--------
12,464
--------
Leasing (2.2%):
1,000 USL Capital Corp., 7.00%, 11/1/97........................ 1,005
2,000 USL Capital Corp., 8.13%, 2/15/00........................ 2,085
--------
3,090
--------
Retail-Discount Store (0.7%):
1,000 Wal-Mart Stores, Inc., 5.50%, 3/1/98..................... 999
--------
Telecommunication Equipment (0.7%):
1,000 Lucent Technologies, Inc., 6.90%, 7/15/01................ 1,022
--------
Total Corporate Bonds (Cost--$75,262) 76,754
--------
U.S. GOVERNMENT AGENCY (1.4%):
1,000 Federal Home Loan Mortgage Corp., 5.75%, 11/16/98,
Continuously callable @ 100............................. 1,002
</TABLE>
Continued
-46-
<PAGE>
AMSOUTH MUTUAL FUNDS
LIMITED MATURITY FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ----------------------------------------------------- --------
<C> <S> <C>
U.S. GOVERNMENT AGENCY, CONTINUED:
$ 1,000 Federal Home Loan Mortgage Corp., 5.90%, 4/21/00,
Continuously
callable @ 100...................................... $ 990
--------
Total U.S. Government Agency (Cost--$1,999) 1,992
--------
U.S. TREASURY NOTES (41.6%):
9,000 6.63%, 7/31/01....................................... 9,236
500 5.88%, 11/30/01...................................... 499
8,700 6.13%, 12/31/01...................................... 8,776
27,500 6.38%, 8/15/02....................................... 28,068
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT SECURITY MARKET
OR SHARES DESCRIPTION VALUE
--------- ---------------------------------------------------------- --------
<C> <S> <C>
U.S. TREASURY NOTES, CONTINUED:
$11,200 5.88%, 2/15/04............................................ $ 11,153
--------
Total U.S. Treasury Notes (Cost--$56,754) 57,732
--------
INVESTMENT COMPANY (0.2%):
221 AmSouth Prime Obligations Fund............................ 221
--------
Total Investment Company (Cost--$221) 221
--------
Total (Cost--$134,236) (a) $136,699
========
</TABLE>
- --------
Percentages indicated are based on net assets of $138,675.
(a) Represents cost for federal income tax purposes and differs from value by
net unrealized appreciation of securities as follows:
<TABLE>
<S> <C>
Unrealized appreciation......... $2,629
Unrealized depreciation......... (166)
------
Net unrealized appreciation..... $2,463
======
</TABLE>
See notes to financial statements.
-47-
<PAGE>
AMSOUTH MUTUAL FUNDS
FLORIDA TAX-FREE FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ----------------------------------------------------------- -------
<C> <S> <C>
FLORIDA MUNICIPAL BONDS (97.7%):
$ 545 Altamonte Springs, Health Facilities Authority, Hospital
Revenue, ETM, 5.60%, 10/1/10.............................. $ 587
655 Brevard County, Solid Waste Disposal System Revenue, 5.63%,
4/1/08, Callable 4/1/03 @ 102............................. 681
1,000 Broward County Expressway Authority, Series A, GO, 6.50%,
7/1/04, Callable 9/26/97 @ 101............................ 1,012
1,500 Broward County School District, GO, 5.60%, 2/15/07,
Callable 2/15/03 @ 102.................................... 1,603
1,000 Cape Coral, Special Obligation Revenue, Wastewater
Assessment--Green Area, 5.50%, 7/1/99, FSA................ 1,027
1,000 Clearwater, Water & Sewer Revenue, 4.75%, 12/1/00, AMBAC... 1,023
1,000 Dade County, Aviation Authority, Series 1994 B, 6.25%,
10/1/04, AMBAC............................................ 1,117
725 Dade County, School Board, Certificates of Participation,
Series A, 5.20%, 5/1/06, AMBAC............................ 762
1,000 Dade County, Water & Sewer System Revenue, 4.70%, 10/1/04,
FGIC...................................................... 1,021
1,000 Davie, Water & Sewer Revenue, 5.20%, 10/1/99, AMBAC........ 1,024
1,000 Division of Bond Finance, Department of Natural Resources,
Preservation 2000, Series A, 5.40%, 7/1/07,
Callable 7/1/03 @ 101, FSA................................ 1,050
1,000 Division of Bond Finance, Department of Natural Resources,
Save Our Coast, 6.30%, 7/1/04,
Callable 7/1/01 @ 101, MBIA............................... 1,078
1,250 Ft. Lauderdale, Park Improvement Project, GO, 5.50%,
7/1/17, Callable 1/1/04 @ 101............................. 1,271
500 Gulf Breeze, Local Government, Series C, 5.90%, 12/1/10,
Callable 12/1/06 @ 101, FGIC.............................. 537
1,000 Hillsborough County, Capital Improvements, County Center
Project, Series B, 5.00%, 7/1/13,
Callable 7/1/06 @ 102, MBIA............................... 1,003
750 Hillsborough County, Environmental Land, 6.00%, 7/1/03 *,
Callable 7/1/02 @ 102, AMBAC-TCRS......................... 819
1,000 Hillsborough County, Solid Waste & Resource Recovery
Revenue, 5.30%, 10/1/03, MBIA............................. 1,056
1,000 Homestead, Special Insurance Assessment Revenue, 4.90%,
9/1/00, MBIA.............................................. 1,027
810 Housing Finance Agency, Homeowner Mortgages, Series 1995 A-
1, 5.65%, 1/1/09, Callable 1/1/06 @ 102................... 836
1,000 Indian River, Hospital District, Hospital Revenue, 5.50%,
10/1/11, Callable 10/1/06 @ 102, FSA...................... 1,051
1,000 Jacksonville, District Water & Sewer Revenue, ETM, 5.20%,
10/1/02, MBIA............................................. 1,048
500 Jacksonville, Electric Authority, St. John's River Power
Park, 6.95%, 10/1/04, Callable 10/1/99 @ 101.5............ 537
1,000 Jacksonville, Electric Authority, St. John's River Issue 2-
15, 4.75%, 10/1/07, Callable 4/1/06 @ 101................. 1,017
1,010 Jacksonville, Excise Tax Revenue, Series A, 5.50%, 10/1/05,
FGIC...................................................... 1,087
1,000 Lake County, Sales Tax Revenue, 5.13%, 12/1/98, FGIC....... 1,016
1,000 Lee County, Capital Improvements Revenue, Series B, 4.75%,
10/1/00, MBIA............................................. 1,021
1,000 Lee County, Local Option Gas Tax Revenue, 4.50%, 10/1/01,
MBIA...................................................... 1,016
500 Manatee County School Board, Certificates of Participation
5.75%, 7/1/09, Callable 7/1/06 @ 102, MBIA................ 547
1,000 Martin County, GO, 3.80%, 8/1/98........................... 1,000
1,000 Miami Beach, Water & Sewer Revenue, 5.38%, 9/1/08, Callable
9/1/05 @ 102, FSA......................................... 1,063
1,000 Orange County, Sales Tax Revenue, Series A, 4.38%, 1/1/01,
FGIC...................................................... 1,011
1,000 Orlando & Orange County Expressway Authority, Expressway
Revenue, Senior Lien, 4.80%, 7/1/01, AMBAC................ 1,026
1,500 Orlando Utilities Commission, Water & Electric Revenue,
Series B, 5.10%, 10/1/11, Callable 10/1/06 @ 100.......... 1,520
1,500 Orlando, Wastewater System Revenue, Series B, 4.90%,
10/1/06, Callable 10/1/03 @ 102, AMBAC.................... 1,541
1,000 Ormond Beach, Water & Sewer Revenue, 5.60%, 9/1/99, FGIC... 1,033
1,000 Pasco County, Water & Sewer Revenue, Series A, 5.50%,
10/1/03, Callable 10/1/02 @ 102, FGIC..................... 1,065
1,000 Pembroke Pines, Public Improvement, 4.63%, 10/1/00, AMBAC.. 1,018
1,000 Polk County, Capital Improvement, 4.30%, 12/1/02, FGIC..... 1,007
1,000 Port of Palm Beach, Revenue Bonds, 6.25%, 9/1/08, Callable
9/1/02 @ 102, MBIA........................................ 1,102
</TABLE>
Continued
-48-
<PAGE>
AMSOUTH MUTUAL FUNDS
FLORIDA TAX-FREE FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ---------------------------------------------------------- -------
<C> <S> <C>
FLORIDA MUNICIPAL BONDS, CONTINUED:
$1,000 Reedy Creek, Improvement District, Series C, 4.90%,
6/1/08, Callable 12/1/05 @ 101, AMBAC.................... $ 1,021
1,000 St. Johns River Management District, Land Acquisition,
5.10%, 7/1/09, Callable 7/1/05 @ 100, FSA................ 1,021
600 St. Lucie County, Sales Tax Revenue, 4.20%, 10/1/01, FGIC. 601
800 St. Lucie County, Sales Tax Revenue, 4.30%, 10/1/02, FGIC. 803
1,000 Seminole County, Local Option Gas Tax Revenue, 5.00%,
10/1/02, FGIC............................................ 1,039
1,000 Seminole County, School District, GO, 5.20%, 8/1/97, MBIA. 1,000
890 Senior Lien, Jacksonville Transportation Authority, GO,
6.25%, 7/1/06............................................ 1,011
1,000 Sunshine Skyway Revenue, 6.60%, 7/1/08 *, Callable 7/1/01
@ 101.................................................... 1,083
1,000 Tallahassee, Consolidated Utility System Revenue, 5.80%,
10/1/08, Callable 10/1/03 @ 102.......................... 1,082
550 Tampa, Solid Waste System Revenue, 4.90%, 10/1/02, FGIC... 568
1,000 Tampa Sports Authority, Local Option Sales Tax Revenue,
Stadium Project, 6.00%, 1/1/06, MBIA..................... 1,110
750 Tampa Water & Sewer Revenue, 5.25%, 10/1/12, Callable
10/1/05 @ 102, FGIC...................................... 770
1,000 Turnpike Authority, Turnpike Revenue, Series A, 5.50%,
7/1/11, Callable 7/1/05 @ 101, FGIC...................... 1,047
1,000 Volusia County School District, GO, 5.30%, 6/1/01, FSA.... 1,040
-------
Total Florida Municipal Bonds (Cost--$50,174)....................... 52,456
-------
INVESTMENT COMPANY (1.4%):
9 AmSouth Tax Exempt Fund................................... 9
766 Dreyfus Florida Money Market Fund......................... 766
-------
Total Investment Company (Cost--$775)............................... 775
-------
Total (Cost--$50,949) (a)........................................... $53,231
=======
</TABLE>
- --------
Percentages indicated are based on net assets of $53,688.
(a) Represents cost for federal income tax purposes and differs from value by
net unrealized appreciation of securities as follows:
<TABLE>
<S> <C>
Unrealized appreciation......... $2,301
Unrealized depreciation......... (19)
------
Net unrealized appreciation..... $2,282
======
</TABLE>
* Put and demand features exist allowing the Fund to require the repurchase of
the instrument within variable time periods including daily, weekly, monthly,
or semiannually.
AMBAC--Insured by AMBAC Indemnity Corp.
ETM--Escrowed to Maturity
FGIC--Insured by Financial Guaranty Insurance Corp.
FSA--Insured by Financial Security Assurance
GO--General Obligation
MBIA--Insured by Municipal Bond Insurance Assoc.
TCRS--Transferrable Custodial Receipts
See notes to financial statements.
-49-
<PAGE>
AMSOUTH MUTUAL FUNDS
MUNICIPAL BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ---------------------------------------------------------- --------
<C> <S> <C>
MUNICIPAL BONDS (95.5%):
Alabama (56.4%):
$3,700 Alabama State Judicial Building Authority, Judicial
Facilties Project, 4.75%, 1/1/05, AMBAC.................. $ 3,765
3,880 Alabama State Judicial Building Authority, Judicial
Facilties Project, 4.85%, 1/1/06, AMBAC.................. 3,969
2,640 Alabama State Mental Health Finance Authority, Special
Tax, 4.88%, 5/1/03, MBIA................................. 2,714
5,000 Alabama State, GO, 5.70%, 9/1/98.......................... 5,099
1,000 Alabama State Industrial Access Road & Bridge Corp.,
Capital Improvements, Series A, 4.40%, 6/1/02............ 1,000
1,520 Alabama State Industrial Access Road & Bridge Corp.,
Capital Improvements, Series A, 4.60%, 6/1/03............ 1,530
3,000 Alabama State Municipal Electric Authority, Power Supply
Revenue, Series A, 5.75%, 9/1/01, MBIA................... 3,180
7,000 Alabama State Public School & College Authority, 4.50%,
12/1/01.................................................. 7,107
7,350 Alabama State Public School & College Authority, 4.75%,
12/1/03, Callable 6/1/03 @ 103 .......................... 7,531
3,340 Alabama State Public School & College Authority, 5.00%,
12/1/05, Callable 6/1/03 @ 103 .......................... 3,462
5,000 Alabama State Public School & College Authority, Capital
Improvement, 4.75%, 11/1/06,
Callable 11/1/05 @ 101................................... 5,093
2,445 Alabama State Water Pollution Control Authority, Revolving
Fund, Series A, 4.60%, 8/15/02, AMBAC.................... 2,487
1,760 Alabama State Water Pollution Control Authority, Revolving
Fund, Series B, 5.25%, 8/15/08,
Callable 8/15/06 @ 100, AMBAC............................ 1,833
1,350 Alabama State Water Pollution Control Authority, Revolving
Fund, Series B, 5.38%, 8/15/10,
Callable 8/15/06 @ 100, AMBAC ........................... 1,398
2,495 Alabama State Water Pollution Control Authority, Revolving
Fund, Series B, 5.40%, 8/15/11,
Callable 8/15/06 @ 100, AMBAC ........................... 2,580
1,000 Auburn University, University Revenues, Athletic, Series
A, 6.70%, 4/1/99, Callable 10/1/97 @ 101 ................ 1,015
1,000 Auburn University, University Revenues, General Fee,
5.25%, 6/1/06, Callable 6/1/03 @ 102, MBIA .............. 1,048
1,500 Birmingham, GO, 4.90%, 7/1/06 ............................ 1,541
1,500 Birmingham, Series B, GO, 5.50%, 4/1/99 .................. 1,535
2,000 Birmingham, Series B, GO, 5.65%, 4/1/00 .................. 2,077
3,465 Birmingham, Industrial Water Board, Industrial Water
Supply, 6.20%, 7/1/08, Pre-refunded 1/1/07 @ 100 ........ 3,743
1,100 Birmingham, Industrial Water Board, Industrial Water
Supply, ETM, 5.30%, 3/1/04, Callable 3/1/03 @ 102 ....... 1,157
1,000 Birmingham, Industrial Water Board, Industrial Water
Supply, ETM, 5.40%, 3/1/05, Callable 3/1/03 @ 102 ....... 1,061
1,300 Birmingham, Industrial Water Board, Industrial Water
Supply, 5.50%, 3/1/06, Pre-refunded 3/1/05 @ 100 ........ 1,386
500 Birmingham Medical Clinic Board, Baptist Medical Centers,
ETM, 8.30%, 7/1/08, Callable 1/1/98 @ 100 ............... 607
1,375 Birmingham Waterworks & Sewer Board, Water & Sewer
Revenue, 5.90%, 1/1/03, Callable 1/1/02 @ 102 ........... 1,481
1,045 Clark & Mobile County, Gas District, 5.60%, 12/1/17,
Callable 12/1/06 @ 102, MBIA ............................ 1,084
9,500 Daphne, Special Care Facilities Financing Authority,
Presbyterian Retirement Corp., 7.30%, 8/15/18,
Pre-refunded 8/15/01 @ 100 .............................. 10,561
655 Decatur, Warrants, Series E, Limited GO, 4.85%, 8/1/03,
Callable 8/1/02 @ 102 ................................... 672
685 Decatur, Warrants, Series E, Limited GO, 5.00%, 8/1/04,
Callable 8/1/02 @ 102 ................................... 707
720 Decatur, Warrants, Series E, Limited GO, 5.10%, 8/1/05,
Callable 8/1/02 @ 102 ................................... 745
760 Decatur, Warrants, Series E, Limited GO, 5.20%, 8/1/06,
Callable 8/1/02 @ 102 ................................... 789
750 Decatur, Warrants, Series E, Limited GO, 5.25%, 8/1/08,
Callable 8/1/02 @ 102 ................................... 773
750 Decatur, Warrants, Series E, Limited GO, 5.30%, 8/1/09,
Callable 8/1/02 @ 102 ................................... 771
2,845 Florence, Warrants, Series A, GO, 4.65%, 9/1/03, MBIA .... 2,895
1,020 Florence, Warrants, Series B, GO, 4.45%, 9/1/02, AMBAC ... 1,032
1,065 Florence, Warrants, Series B, GO, 4.55%, 9/1/03, AMBAC ... 1,080
</TABLE>
Continued
-50-
<PAGE>
AMSOUTH MUTUAL FUNDS
MUNICIPAL BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- --------------------------------------------------------- --------
<C> <S> <C>
MUNICIPAL BONDS, CONTINUED:
Alabama, continued:
$4,700 Gadsden, East Alabama Medical Clinic Board, Baptist
Hospital of Gadsden, Inc., Series A, 7.80%, 11/1/21,
Pre-refunded 11/1/01 @ 102 ............................. $ 5,426
9,455 Hoover, Warrants, Series B, GO, 8.00%, 3/1/20, Pre-
refunded 3/1/00 @ 102, AMBAC ........................... 10,532
1,000 Houston County, Warrants, Series A, Limited GO, 5.00%,
7/1/02 ................................................. 1,033
2,500 Huntsville, Warrants, Limited GO, 6.95%, 2/1/02, Pre-
refunded 2/1/00 @ 102 .................................. 2,716
6,545 Huntsville, Warrants, Series A, GO, 4.50%, 2/1/02 ....... 6,619
2,780 Huntsville, Water System, Warrants, 5.00%, 5/1/02,
AMBAC .................................................. 2,866
3,125 Huntsville, Water System, Warrants, 5.05%, 5/1/03,
Callable 5/1/02 @ 102, AMBAC ........................... 3,233
1,370 Jefferson County, Warrants, GO, 6.75%, 4/1/00, Pre-
refunded 4/1/99 @ 102 .................................. 1,454
1,000 Jefferson County, Warrants, GO, 6.80%, 4/1/01, Pre-
refunded 4/1/99 @ 102 .................................. 1,062
1,000 Jefferson County, Warrants, GO, ETM, 6.50%, 4/1/99 ...... 1,040
5,000 Jefferson County, Warrants, GO, 5.00%, 4/1/04, Callable
4/1/03 @ 102 ........................................... 5,139
1,000 Jefferson County Board of Education, Capital Outlay,
5.40%, 2/15/10, Callable 2/15/03 @ 102, AMBAC .......... 1,040
1,500 Jefferson County, Sewer Revenue Warrants, ETM, 7.00%,
9/1/98 ................................................. 1,549
2,400 Jefferson County, Sewer Revenue Warrants, 5.40%, 9/1/04,
Pre-refunded 3/1/03 @ 102.5, MBIA ...................... 2,581
2,500 Mobile, Warrants, GO, Convention Center Project, 7.13%,
8/15/20, Pre-refunded 8/15/00 @ 102, AMBAC ............. 2,761
1,685 Mobile, Warrants, GO, 6.50%, 2/15/06, AMBAC ............. 1,923
1,000 Mobile, Water & Sewer Commissioners, Water & Sewer
Revenue, Series A, 7.10%, 1/1/99,
Callable 1/1/98 @ 101 .................................. 1,024
3,250 Mobile, Water & Sewer Commissioners, Water & Sewer
Revenue, 5.00%, 1/1/05, FGIC ........................... 3,358
1,350 Mobile County, Series A, GO, 5.00%, 2/1/04, Callable
2/1/03 @ 102 ........................................... 1,393
1,000 Mobile County, Warrants, Series A, Limited GO, 5.00%,
2/1/04, Callable 2/1/03 @ 102 .......................... 1,032
5,000 Mobile County, Warrants, Series A, Limited GO, 5.10%,
2/1/05, Callable 2/1/03 @ 102 .......................... 5,196
1,000 Mobile County, Warrants, GO, 6.35%, 2/1/04, Pre-refunded
2/1/00 @ 102 ........................................... 1,072
1,850 Mobile County, Warrants, GO, 6.55%, 2/1/06, Pre-refunded
2/1/00 @ 102 ........................................... 1,992
2,670 Mobile County Board of School Commissioners, Warrants,
Capital Outlay, 4.80%, 3/1/02, AMBAC ................... 2,734
1,040 Montgomery, Warrants, Series A, GO, 5.00%, 5/1/05,
Callable 5/1/03 @ 102 .................................. 1,074
1,000 Montgomery, Warrants, Series A, GO, 5.00%, 5/1/06,
Callable 5/1/03 @ 102 .................................. 1,030
1,000 Montgomery, Waterworks & Sanitary Sewer Board, 7.20%,
9/1/02, Pre-refunded 3/1/00 @ 102 ...................... 1,092
1,000 Montgomery, Waterworks & Sanitary Sewer Board, Series B,
5.45%, 9/1/00 .......................................... 1,037
1,410 Montgomery, Waterworks & Sanitary Sewer Board, Series B,
5.60%, 3/1/01 .......................................... 1,473
1,000 Montgomery, Waterworks & Sanitary Sewer Board, Series B,
5.70%, 9/1/02 .......................................... 1,063
560 Montgomery, Waterworks & Sanitary Sewer Board, Series B,
5.85%, 3/1/03 .......................................... 600
2,500 Montgomery, Waterworks & Sanitary Sewer Board, Series B,
6.25%, 9/1/08, Callable 9/1/02 @ 102 ................... 2,732
3,565 Montgomery, Waterworks & Sanitary Sewer Board, Series B,
6.30%, 9/1/10, Callable 9/1/02 @ 102 ................... 3,868
3,000 Montgomery, Waterworks & Sanitary Sewer Board, 5.50%,
9/1/08, Callable 9/1/06 @ 101, MBIA .................... 3,196
1,500 Montgomery County, Warrants, GO, 5.00%, 11/1/04, Callable
11/1/02 @ 102 .......................................... 1,553
1,510 Shelby County, Warrants, Series A, 5.60%, 2/1/02, AMBAC . 1,598
1,990 Shelby County, Warrants, Series A, 5.60%, 8/1/02, AMBAC . 2,118
1,830 Shelby County, Warrants, Series A, 5.70%, 2/1/03, AMBAC . 1,959
335 Talladega County, Industrial Development Board, Cyprus 1
Project, 9.75%, 12/1/13, Callable 8/30/97 @ 101.5 ...... 340
635 Tuscaloosa County, Warrants, GO, 5.45%, 10/1/02 ......... 672
</TABLE>
Continued
-51-
<PAGE>
AMSOUTH MUTUAL FUNDS
MUNICIPAL BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ----------------------------------------------------- --------
<C> <S> <C>
MUNICIPAL BONDS, CONTINUED:
Alabama, continued:
$ 600 Tuscaloosa County, Warrants, GO, 5.50%, 10/1/03 ..... $ 639
740 Tuscaloosa County, Warrants, GO, 5.60%, 10/1/04 ..... 795
1,000 University of Alabama, University Revenues, ETM,
6.90%, 10/1/99 ..................................... 1,060
2,185 University of South Alabama, University Revenues,
Tuition, 4.70%, 11/15/08, Callable 5/15/06 @ 102,
AMBAC .............................................. 2,184
650 Vestavia Hills, Warrants, GO, 4.60%, 4/1/02 ......... 659
680 Vestavia Hills, Warrants, GO, 4.70%, 4/1/03 ......... 691
--------
190,716
--------
Florida (3.1%):
6,500 Florida State Board of Education, Capital Outlay,
Series A, GO, 5.00%, 6/1/08 ........................ 6,759
3,625 Florida State Board of Education, Capital Outlay,
Series A, GO, 5.00%, 6/1/09 ........................ 3,759
--------
10,518
--------
Georgia (5.4%):
4,390 Cobb County, Detention Buildings & Facilities, GO,
5.30%, 1/1/07, Callable 1/1/03 @ 102 ............... 4,624
3,500 Cobb County School District, GO, 5.00%, 2/1/03 ...... 3,635
5,000 Georgia Municipal Electric Authority, Series Z, GO of
Participants, 4.50%, 1/1/00 ........................ 5,026
2,000 Georgia State Environmental Facilities Authority,
Water & Sewer, 6.20%, 7/1/02, Callable 7/1/99 @ 102,
State Guaranteed ................................... 2,112
2,500 Georgia State Tollway Authority, Georgia 400 Project,
6.50%, 7/1/04, Callable 7/1/01 @ 102, State
Guaranteed ......................................... 2,744
--------
18,141
--------
Maryland (1.7%):
3,000 Anne Arundel County, GO, 4.70%, 4/1/04 .............. 3,065
2,500 Montgomery County, Consolidated Public Improvements,
Series A, GO, 5.50%, 10/1/04 ....................... 2,689
--------
5,754
--------
Massachusetts (0.4%):
1,150 Massachusetts State Consolidated Loan, Series C, GO,
6.75%, 8/1/06, Pre-refunded 8/1/01 @ 102 ........... 1,280
--------
Minnesota (0.7%):
2,175 Centennial Independent School District, No. 12,
Series A, GO, 5.60%, 2/1/07, MBIA .................. 2,358
--------
Missouri (2.3%):
7,535 Missouri State, State Water Pollution, Series B, GO,
5.00%, 8/1/07, Callable 8/1/03 @ 102 ............... 7,832
--------
New Jersey (1.5%):
5,000 New Jersey State, Series E, GO, 5.00%, 7/15/04 ...... 5,208
--------
North Carolina (4.3%):
9,875 North Carolina State, Capital Improvements, Series A,
GO, 4.70%, 2/1/06, Callable 2/1/04 @ 101 ........... 10,133
4,250 Wake County, GO, 4.90%, 3/1/08, Callable 3/1/07 @
100.5 .............................................. 4,392
--------
14,525
--------
Rhode Island (0.8%):
2,565 Rhode Island State, Consolidated Development Capital
Loan, Series A, GO, 5.00%, 7/15/01, FGIC ........... 2,644
--------
</TABLE>
Continued
-52-
<PAGE>
AMSOUTH MUTUAL FUNDS
MUNICIPAL BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- --------------------------------------------------------- --------
<C> <S> <C>
MUNICIPAL BONDS, CONTINUED:
Tennessee (3.9%):
$3,000 Metropolitan Government, Nashville & Davidson County, GO,
5.25%, 5/15/06 ......................................... $ 3,182
1,000 Shelby County, Series A, GO, 5.60%, 5/1/04, Callable
5/1/98 @ 101.5 ......................................... 1,024
5,495 Tennessee State, Series B, GO, 4.60%, 5/1/07, Callable
5/1/06 @ 100 ........................................... 5,566
3,000 Tennessee State, Series B, GO, 6.40%, 6/1/02, Pre-
refunded 6/1/01 @ 101.5 ................................ 3,278
--------
13,050
--------
Texas (4.6%):
2,000 Dallas County, Unlimited Tax, Road Improvements, GO,
6.00%, 8/15/01 ......................................... 2,144
655 Dallas Independent School District, GO, 5.60%, 8/15/05,
Pre-refunded 8/15/03 @ 100 ............................. 700
1,845 Dallas Independent School District, GO, 5.60%, 8/15/05,
Callable 8/15/03 @ 100 ................................. 1,956
2,000 Texas State, Series A, GO, 5.60%, 10/1/02 ............... 2,133
5,000 Texas State, Series B, GO, 5.25%, 10/1/08, Callable
10/1/03 @ 100 .......................................... 5,153
3,575 University of Texas, 4.60%, 7/1/08, Callable 7/1/06 @ 100
........................................................ 3,578
--------
15,664
--------
Utah (1.1%):
3,810 Jordan School District, GO, 4.80%, 6/15/08, Callable
6/15/07 @ 100 .......................................... 3,870
--------
Virginia (4.1%):
3,200 Chesapeake, Public Improvements, GO, 5.00%, 5/1/04 ...... 3,320
5,165 Fairfax County, Public Improvements, Series A, GO, 4.75%,
6/1/04 ................................................. 5,307
5,000 Virginia State, GO, 5.00%, 6/1/08, Callable 6/1/07 @ 100
........................................................ 5,185
--------
13,812
--------
Washington (3.7%):
1,680 Washington State, Series A, GO, 6.00%, 3/1/02, Callable
3/1/01 @ 100 ........................................... 1,780
1,785 Washington State, Series B, GO, 6.40%, 6/1/03,
Prerefunded 6/1/01 @ 100 ............................... 1,927
6,500 Washington State, GO, 5.75%, 9/1/08 ..................... 7,155
1,570 Washington State, Unrefunded Balance, Series R-92-B,
Limited GO, 6.10%, 9/1/00 .............................. 1,661
--------
12,523
--------
Wisconsin (1.5%):
4,650 Wisconsin State, Series 1, GO, 5.30%, 11/1/03 ........... 4,907
--------
Total Municipal Bonds (Cost--$309,341) 322,802
--------
</TABLE>
Continued
-53-
<PAGE>
AMSOUTH MUTUAL FUNDS
MUNICIPAL BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ---------------------------------------------------------- --------
<C> <S> <C>
INVESTMENT COMPANIES (3.3%):
2,812 Federated Tax-Free Trust Mutual Fund ..................... $ 2,812
8,290 Goldman Sachs Tax-Free Fund .............................. 8,290
--------
Total Investment Companies (Cost--$11,102).......................... 11,102
--------
Total (Cost--$320,443) (a).......................................... $333,904
========
</TABLE>
- --------
Percentages indicated are based on net assets of $337,933.
(a) Represents cost for federal income tax purposes and differs from value by
net unrealized appreciation of securities as follows:
<TABLE>
<S> <C>
Unrealized appreciation... $13,548
Unrealized depreciation... (87)
-------
Net unrealized
appreciation.............. $13,461
=======
</TABLE>
AMBAC--Insured by AMBAC Indemnity Corp.
ETM--Escrowed to Maturity
FGIC--Insured by Financial Guaranty Insurance Corp.
GO--General Obligation
MBIA--Insured by Municipal Bond Insurance Assoc.
See notes to financial statements.
-54-
<PAGE>
AMSOUTH MUTUAL FUNDS
PRIME OBLIGATIONS FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
PRINCIPAL SECURITY AMORTIZED
AMOUNT DESCRIPTION COST
--------- --------------------------------------------------------- ---------
<C> <S> <C>
CERTIFICATES OF DEPOSIT (4.6%):
Domestic Certificate of Deposit (1.9%):
$10,000 Bankers' Trust, New York, 5.92%, 7/17/98................. $ 9,997
--------
Euro Certificate of Deposit (2.7%):
14,000 Toronto Dominion Bank, 5.78%, 1/13/98.................... 14,000
--------
Total Certificates of Deposit
(Amortized cost--$23,997) 23,997
--------
COMMERCIAL PAPER--DOMESTIC (59.9%):
Asset-Backed (0.6%):
3,000 Cooper River Funding, Inc., 5.61%, 8/1/97................ 3,000
--------
Automotive (10.9%):
7,000 Daimler-Benz North America Corp., 5.62%, 8/15/97......... 6,985
6,000 Daimler-Benz North America Corp., 5.51%, 9/10/97......... 5,963
6,000 Daimler-Benz North America Corp., 5.51%, 9/18/97......... 5,956
10,000 Ford Motor Credit Co., 5.55%, 8/6/97..................... 9,992
5,000 General Motors Acceptance Corp., 5.71%, 8/1/97........... 5,000
5,000 General Motors Acceptance Corp., 7.25%, 10/17/97......... 5,010
9,000 Mitsubishi Motor Credit, 5.65%, 9/8/97................... 8,947
10,000 Mitsubishi Motor Credit, 5.57%, 10/9/97.................. 9,893
--------
57,746
--------
Electronics (1.9%):
10,000 Sharp Electronics Corp., 5.50%, 9/12/97.................. 9,936
--------
Electric Utility (5.3%):
5,000 AES Shady Point, Inc., 5.57%, 10/9/97.................... 4,947
5,000 AES Shady Point, Inc., 5.82%, 10/14/97................... 4,940
1,900 Alabama Power Co., 5.45%, 8/5/97......................... 1,899
10,000 Alabama Power Co., 5.50%, 10/17/97....................... 9,882
6,180 Southern California Edison, 5.50%, 9/19/97............... 6,134
--------
27,802
--------
Financial Services (10.2%):
9,400 Cooperative Assoc. of Tractor Dealers, 5.65%, 8/5/97..... 9,394
5,000 Cooperative Assoc. of Tractor Dealers, 5.66%, 10/1/97.... 4,952
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL SECURITY AMORTIZED
AMOUNT DESCRIPTION COST
--------- --------------------------------------------------------- ---------
<C> <S> <C>
COMMERCIAL PAPER--DOMESTIC, CONTINUED:
Financial Services, continued:
$ 5,000 IBM Credit Corp., 5.55%, 8/13/97......................... $ 4,991
10,000 International Lease Finance Corp., 5.54%, 8/4/97......... 9,995
10,000 International Lease Finance Corp., 5.63%, 9/2/97......... 9,950
5,000 International Lease Finance Corp., 5.46%, 9/8/97......... 4,971
10,000 Island Financial Puerto Rico, 5.60%, 9/11/97............. 9,936
--------
54,189
--------
Food Processing (4.0%):
10,000 Cargill, Inc., 5.50%, 8/8/97............................. 9,989
6,000 Cargill, Inc., 5.47%, 8/22/97............................ 5,981
5,000 Cargill, Inc., 5.50%, 8/25/97............................ 4,982
--------
20,952
--------
Foreign Banking (1.9%):
10,000 Toronto Dominion Holdings, 5.40%, 10/7/97................ 9,900
--------
Hotels & Lodging (2.8%):
10,000 Accor SA, 5.58%, 9/19/97................................. 9,924
5,000 Accor SA, 5.55%, 10/8/97................................. 4,948
--------
14,872
--------
Insurance (6.8%):
10,000 Great West Life & Annuity Insurance Co., 5.55%, 9/4/97... 9,947
6,500 International Nederlanden Holdings, 5.50%, 8/18/97....... 6,483
10,000 International Nederlanden Holdings, 5.60%, 10/1/97....... 9,905
10,000 International Nederlanden Holdings, 5.53%, 11/3/97....... 9,856
--------
36,191
--------
Retail (5.1%):
9,000 Southland Corp., 5.55%, 8/12/97.......................... 8,985
8,000 Southland Corp., 5.51%, 8/13/97.......................... 7,985
10,000 Southland Corp., 5.55%, 9/3/97........................... 9,949
--------
26,919
--------
Security Brokers & Dealers (5.6%):
10,000 C.S. First Boston Corp., 5.53%, 10/27/97................. 9,866
</TABLE>
Continued
-55-
<PAGE>
AMSOUTH MUTUAL FUNDS
PRIME OBLIGATIONS FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
PRINCIPAL SECURITY AMORTIZED
AMOUNT DESCRIPTION COST
--------- -------------------------------------------------------- ---------
<C> <S> <C>
COMMERCIAL PAPER--DOMESTIC, CONTINUED:
Security Brokers & Dealers, continued:
$ 5,000 Merrill Lynch & Co., Inc., 5.51%, 8/27/97............... $ 4,980
5,000 Merrill Lynch & Co., Inc., 5.50%, 10/3/97............... 4,952
5,000 Merrill Lynch & Co., Inc., 5.73%, 12/1/97............... 4,903
5,000 Merrill Lynch & Co., Inc., 5.77%, 1/2/98................ 4,877
--------
29,578
--------
Telecommunications (4.8%):
12,500 BellSouth Telecom, Inc., 5.43%, 8/7/97.................. 12,489
13,000 SBC Communications, Inc., 5.45%, 10/16/97............... 12,850
--------
25,339
--------
Total Commercial Paper--Domestic
(Amortized cost--$316,424) 316,424
--------
COMMERCIAL PAPER--FOREIGN (7.0%):
Canada (0.9%):
5,000 Province of Quebec, 5.73%, 11/18/97..................... 4,913
--------
Mexico (1.9%):
10,000 Cemex, SA, 5.65%, 8/19/97............................... 9,972
--------
Norway (2.4%):
6,475 Eksportfinans A/S, 5.54%, 8/11/97....................... 6,465
6,350 Eksportfinans A/S, 5.58%, 9/9/97........................ 6,311
--------
12,776
--------
United Kingdom (1.8%):
9,500 Abbey National, NA, 5.75%, 10/10/97..................... 9,394
--------
Total Commercial Paper--Foreign
(Amortized cost--$37,055) 37,055
--------
CORPORATE BONDS (4.3%):
Automotive (1.0%):
5,000 Ford Capital B.V., 9.38%, 1/1/98 (Guaranteed by Ford
Motor Co.)............................................. 5,072
--------
Banking-Domestic (2.8%):
5,000 First Chicago NBD, 5.70%, 1/8/98........................ 4,999
10,000 PNC Bank, N.A., 5.64%*, 10/1/97......................... 9,999
--------
14,998
--------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL SECURITY AMORTIZED
AMOUNT DESCRIPTION COST
--------- -------------------------------------------------------- ---------
<C> <S> <C>
CORPORATE BONDS, CONTINUED:
Financial Services (0.5%):
$ 1,000 General Electric Capital Corp., 8.00%, 1/15/98.......... $ 1,009
1,500 General Electric Capital Corp., 7.95%, 2/2/98........... 1,515
--------
2,524
--------
Total Corporate Bonds (Amortized cost--$22,594) 22,594
--------
FLOATING RATE FUNDING AGREEMENTS (7.0%):
12,500 Commonwealth Life Insurance Co., 5.83%*, 8/1/97(b)...... 12,500
12,000 General American Life Insurance Co., 5.97%*, 8/1/97(b).. 12,000
12,500 Peoples Security Life Insurance Co., 5.78%*, 8/1/97(b).. 12,500
--------
Total Guaranteed Insurance Contracts
(Amortized cost--$37,000) 37,000
--------
MEDIUM TERM NOTES (1.4%):
Banking (1.4%):
7,590 Marshall & Ilsley, 7.38%, 10/31/97...................... 7,617
--------
Total Medium Term Notes
(Amortized cost--$7,617) 7,617
--------
TAXABLE MUNICIPAL BONDS (1.9%):
New York (1.9%):
10,000 New York City, GO, Series B-11, Taxable, 5.86%*,
8/21/97(b) FGIC........................................ 10,000
--------
Total Taxable Municipal Bonds
(Amortized cost--$10,000) 10,000
--------
U.S. GOVERNMENT AGENCIES (1.9%):
10,000 Federal Farm Credit Bank, 5.55%*, 10/29/97.............. 9,998
--------
Total U.S. Government Agencies
(Amortized cost--$9,998) 9,998
--------
Total Investments (Amortized cost--$464,685) 464,685
--------
</TABLE>
Continued
-56-
<PAGE>
AMSOUTH MUTUAL FUNDS
PRIME OBLIGATIONS FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
PRINCIPAL SECURITY AMORTIZED
AMOUNT DESCRIPTION COST
--------- -------------------------------------------------------- ---------
<C> <S> <C>
REPURCHASE AGREEMENT (12.2%):
$64,263 C.S. First Boston Corp. dated 7/31/97, 5.93%, due
8/1/97, proceeds at maturity $64,273 (Collateralized by
$69,279 U.S. Federal Home Loan Mortgage Corp. Discount
Notes, 8/5/97-10/31/97, market value--$67,478)......... $ 64,263
--------
Total Repurchase Agreement 64,263
--------
Total (Amortized cost--$528,948) (a) $528,948
========
</TABLE>
- --------
Percentages indicated are based on net assets of $527,993.
(a) Cost and value for federal income tax and financial reporting purposes are
the same.
(b) Put and demand features exist allowing the Fund to require the repurchase
of the instrument within variable time periods including daily, weekly,
monthly, quarterly, or semiannually.
*Variable rate security. Rate presented represents rate in effect at July
31,1997. Date presented reflects next rate change date.
GO--General Obligation
FGIC--Insured by Financial Guaranty Insurance Corp.
See notes to financial statements.
-57-
<PAGE>
AMSOUTH MUTUAL FUNDS
U.S. TREASURY FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
PRINCIPAL SECURITY AMORTIZED
AMOUNT DESCRIPTION COST
--------- --------------------------------------------------------- ---------
<C> <S> <C>
U.S. TREASURY BILLS (43.8%):
$20,000 8/7/97................................................... $ 19,984
13,000 8/14/97.................................................. 12,977
15,000 8/21/97.................................................. 14,959
10,000 8/28/97.................................................. 9,963
5,000 9/4/97................................................... 4,977
10,000 9/11/97.................................................. 9,945
17,000 9/18/97.................................................. 16,884
8,000 10/2/97.................................................. 7,930
10,000 10/16/97................................................. 9,891
6,000 10/23/97................................................. 5,926
5,000 11/6/97.................................................. 4,931
10,000 11/13/97................................................. 9,852
6,000 1/29/98.................................................. 5,846
6,000 2/5/98................................................... 5,839
--------
Total U.S. Treasury Bills
(Amortized cost--$139,904)........................................ 139,904
--------
U.S. TREASURY NOTES (21.6%):
11,000 6.50%, 8/15/97........................................... 11,005
5,000 6.00%, 8/31/97........................................... 5,000
10,000 5.50%, 9/30/97........................................... 10,002
10,000 5.75%, 9/30/97........................................... 10,004
5,000 5.63%, 10/31/97.......................................... 5,003
6,000 7.38%, 11/15/97.......................................... 6,031
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL SECURITY AMORTIZED
AMOUNT DESCRIPTION COST
--------- -------------------------------------------------------- ---------
<C> <S> <C>
U.S. TREASURY NOTES, CONTINUED:
$ 6,000 6.00%, 11/30/97......................................... $ 6,010
10,000 5.25%, 12/31/97......................................... 9,985
6,000 5.13%, 4/30/98.......................................... 5,980
--------
Total U.S. Treasury Notes
(Amortized cost--$69,020)........................................ 69,020
--------
Total Investments (Amortized cost--$208,924)...................... 208,924
--------
REPURCHASE AGREEMENTS (34.6%):
55,226 C.S. First Boston Corp., 5.77%, dated 7/31/97, due
8/1/97, proceeds at maturity of $55,235 (Collateralized
by $54,478 U.S. Treasury Notes, 6.63%-6.88%, 6/30/01-
5/15/06, market
value--$56,745)........................................ 55,226
55,226 Merrill Lynch & Co., 5.75%, dated 7/31/97, due 8/1/97,
proceeds at maturity of $55,234 (Collateralized by
$59,385 U.S. Treasury Bills, 7/23/98, market value--
$56,332)............................................... 55,226
--------
Total Repurchase Agreements....................................... 110,452
--------
Total (Amortized cost--$319,376) (a).............................. $319,376
========
</TABLE>
- --------
Percentages indicated are based on net assets of $319,246.
(a) Cost and value for federal income tax and financial reporting purposes are
the same.
See notes to financial statements.
-58-
<PAGE>
AMSOUTH MUTUAL FUNDS
TAX-EXEMPT FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
PRINCIPAL
SHARES OR VALUE OR
PRINCIPAL SECURITY AMORTIZED
AMOUNT DESCRIPTION COST
--------- -------------------------------------------------------- ---------
<C> <S> <C>
TAX ANTICIPATION NOTES (4.2%):
California (1.2%):
$1,000 Los Angeles County, Tax & Revenue Anticipation Note, GO,
Series A, 4.50%, 6/30/98, LOC:
Credit Suisse, NY & Morgan Guaranty.................... $ 1,006
-------
Colorado (1.8%):
1,500 Colorado General Fund, Tax & Revenue Anticipation Notes,
Series A, 4.50%, 6/26/98............................... 1,509
-------
Illinois (1.2%):
1,000 Metropolitan Pier & Exposition Authority, 5.00%, 6/1/98,
AMBAC.................................................. 1,009
-------
Total Tax Anticipation Notes (Amortized cost--$3,524) 3,524
-------
DEMAND NOTES (51.3%):
Alabama (17.8%):
2,000 Alabama State Housing Finance Authority, Multi-Family
Housing Revenue, Rime VLG Hoover Project,
Series A, 3.65%*, 8/6/97**, FNMA....................... 2,000
2,000 City of Birmingham, Series 1992A, GO, 3.65%*, 8/6/97**,
LOC: Regions Bank...................................... 2,000
2,500 Columbia, Industrial Development Board, PCR, Alabama
Power Co. Project, Series D, 3.65%*, 8/1/97**.......... 2,500
1,000 Jacksonville, Industrial Development Board, Parker
Hannifin Corp., 3.65%*, 8/7/97......................... 1,000
2,000 Mobile, Industrial Development Board, PCR, Alabama Power
Co. Project, Series B, 3.65%*, 8/7/97**................ 2,000
550 Montgomery, Industrial Development Board, Industrial
Partners Project, 3.80%*, 8/6/97**..................... 550
2,900 North Alabama Environmental Improvement Authority, PCR,
Reynolds Metals Co., 3.70%*, 8/1/97**,
LOC: Bank of Nova Scotia............................... 2,900
1,865 Stevenson, Industrial Development Board, Environmental
Improvement Revenue, Mead Corp. Project,
3.70%*, 8/1/97**, LOC: Credit Suisse................... 1,865
-------
14,815
-------
Arizona (1.2%):
1,000 Pima County, Industrial Development Authority, Tucson
Electric, Series A, 3.65%*, 8/6/97**,
LOC: Societe Generale, NY.............................. 1,000
-------
California (2.9%):
1,000 Los Angeles Regional Airports Improvement Corp.,
American Airlines--Los Angeles International--A,
3.70%*, 8/1/97**, LOC: Wachovia Bank................... 1,000
1,400 Los Angeles Regional Airports Improvement Corp., Los
Angeles International--LAX 2, 3.70%*,
8/1/97**, LOC: Societe Generale........................ 1,400
-------
2,400
-------
Florida (2.0%):
1,680 Laurel Club, Certificates of Participation, Series 96A,
3.80%*, 8/7/97**, LOC: Swiss Bank Corp. ............... 1,680
-------
Georgia (1.5%):
500 Savannah, Downtown Development Authority, Parking
Facilities Project, 3.65%*, 8/6/97, SPA: National
Westminster Bank PLC................................... 500
750 Savannah, Downtown Development Authority, Parking
Facilities Project, 3.65%*, 8/6/97**, SPA: National
Westminster Bank PLC................................... 750
-------
1,250
-------
</TABLE>
Continued
-59-
<PAGE>
AMSOUTH MUTUAL FUNDS
TAX-EXEMPT FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
PRINCIPAL
SHARES OR VALUE OR
PRINCIPAL SECURITY AMORTIZED
AMOUNT DESCRIPTION COST
--------- -------------------------------------------------------- ---------
<C> <S> <C>
DEMAND NOTES, CONTINUED:
Illinois (1.3%):
$1,100 Chicago, O'Hare International Airport, General Airport
2nd Lien, Series A, 3.65%*, 8/6/97**,
LOC: Societe Generale, NY.............................. $ 1,100
-------
Missouri (3.3%):
200 Kansas City, Industrial Development Authority, Hospital
Revenue, Resh Health Services System, 3.75%*, 8/1/97**,
MBIA, SPA: Bank of America............................. 200
535 Missouri State Industrial Development Board, John E.
Raidel, Lot 2, Series F, 3.75%*, 8/6/97**, LOC:
Credit Commerciale de France........................... 535
2,000 St. Charles County, Industrial Development Authority,
Sun River Village Apartments Project,
3.65%*, 8/7/97**, LOC: Bank of America................. 2,000
-------
2,735
-------
Nebraska (2.0%):
1,700 Nebraska Educational Facilities Authority, Educational
Equipment & Improvements, 3.65%*,
8/6/97**, FGIC, SPA: Mitsubishi Bank, NY............... 1,700
-------
New York (1.2%):
1,000 New York, GO, Sub-series E5, 3.70%*, 8/1/97, LOC: Morgan
Guaranty Trust......................................... 1,000
-------
Ohio (1.1%):
950 Hamilton County, Health Care System, West Park Issue,
3.70%*, 8/6/97, LOC: Fifth Third Bank.................. 950
-------
Pennsylvania (1.4%):
1,200 Schuylkill County, Industrial Development Authority,
Resource Recovery Revenue, Gilberton Power
Project, 3.65%*, 8/6/97**, LOC: Mellon Bank............ 1,200
-------
South Carolina (2.9%):
2,400 South Carolina State Jobs & Economic Development
Authority, Economic Development Revenue,
St. Francis Hospital, 3.70%*, 8/1/97**, LOC: Chase
Manhattan Bank......................................... 2,400
-------
Tennessee (4.1%):
1,900 Metropolitan Nashville Airport Authority, Special
Facilities Revenue, American Airlines PJ--Series A,
3.70%*, 8/1/97**, LOC: Credit Suisse................... 1,900
1,500 Sullivan County, Industrial Development Board, PCR, Mead
Corp. Project, 3.70%*, 8/1/97**,
LOC: Union Bank of Switzerland......................... 1,500
-------
3,400
-------
Texas ( 7.7%):
1,900 Grapevine, Industrial Development Corp., American
Airlines-A4, 3.70%*, 8/1/97**, LOC: Morgan Guaranty.... 1,900
900 Grapevine, Industrial Development Corp., American
Airlines-B4, 3.70%*, 8/1/97**, LOC: Morgan Guaranty.... 900
1,700 Lone Star Airport Improvement Authority, Series A3,
3.70%*, 8/1/97**, LOC: Royal Bank of Canada............ 1,700
1,900 Lone Star Airport Improvement Authority, Series B3,
3.70%*, 8/1/97**, LOC: Royal Bank of Canada............ 1,900
-------
6,400
-------
</TABLE>
Continued
-60-
<PAGE>
AMSOUTH MUTUAL FUNDS
TAX-EXEMPT FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
PRINCIPAL
SHARES OR VALUE OR
PRINCIPAL SECURITY AMORTIZED
AMOUNT DESCRIPTION COST
--------- -------------------------------------------------------- ---------
<C> <S> <C>
DEMAND NOTES, CONTINUED:
West Virginia (0.9%):
$ 700 Putnam County, Industrial Development Revenue, FMC
Corp., 3.80%*, 8/1/97**, LOC: Union Bank of
Switzerland............................................ $ 700
-------
Total Demand Notes (Amortized cost--$42,730)...................... 42,730
-------
MUNICIPAL BONDS (38.1%):
Alabama (2.2%):
1,850 University of Alabama, University Revenues, 6.80%,
10/1/97................................................ 1,859
-------
Arizona (1.3%):
1,000 Salt River Project, Agricultural Improvements & Power
District, 7.88%, 1/1/28, Pre-refunded 1/1/98 @ 102..... 1,037
50 Scottsdale, Industrial Development Authority, Hospital
Revenue, Scottsdale Memorial Hospital, Series A,
8.50%, 9/1/17, Pre-refunded 9/1/97 @ 102, AMBAC........ 51
-------
1,088
-------
California (1.7%):
400 Northern California Power Agency, Geothermal Project No.
3, Series B, 5.00%, 7/1/98, AMBAC...................... 403
1,000 Sacramento-Yolo Port District, Facilities Improvement,
Series A, 8.30%, 12/1/03, Pre-refunded 12/1/97
@ 102.................................................. 1,035
-------
1,438
-------
Florida (0.5%):
100 Bay County, Transportation Improvements, ETM, 7.00%,
9/1/97, AMBAC.......................................... 100
295 Henando County, Water & Sewer Revenue, 5.10%, 6/1/98,
FGIC................................................... 298
-------
398
-------
Georgia (1.2%):
1,000 Spalding County, Sales Tax, GO, 4.15%, 7/1/98, FSA...... 1,003
-------
Hawaii (2.6%):
1,000 Hawaii State, Dept. Budget & Finance, Special Purpose
Mortgage, Queens Medical Center Project, 6.90%, 7/1/04,
Pre-refunded 7/1/98 @ 102, FGIC........................ 1,047
400 Hawaii State, GO, Series BN, 7.10%, 6/1/09, Pre-refunded
6/1/98 @ 101.5......................................... 417
200 Hawaii State, GO, Series BO, 6.25%, 8/1/97.............. 200
500 Hawaii State, GO, Series BP, 6.00%, 8/1/04, Pre-refunded
8/1/97 @ 102........................................... 510
-------
2,174
-------
Illinois (0.4%):
255 Chicago, Metropolitan Water Reclamation District, GO,
4.20%, 12/1/97......................................... 255
100 Kane, Cook & DuPage Counties, School District No. 46,
GO, 5.90%, 1/2/98, FGIC................................ 101
-------
356
-------
</TABLE>
Continued
-61-
<PAGE>
AMSOUTH MUTUAL FUNDS
TAX-EXEMPT FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
PRINCIPAL
SHARES OR VALUE OR
PRINCIPAL SECURITY AMORTIZED
AMOUNT DESCRIPTION COST
--------- -------------------------------------------------------- ---------
<C> <S> <C>
MUNICIPAL BONDS, CONTINUED:
Kansas (1.3%):
$1,000 Olathe, Temporary Notes, GO, Series A, 4.50%, 6/1/98.... $ 1,006
100 Wichita, Hospital Revenues, St. Francis III-A-3, 5.00%,
10/1/97, MBIA.......................................... 100
-------
1,106
-------
Kentucky (0.4%):
300 Campbell & Kenton Counties, Sanitation District No. 1,
Series A, 7.75%, 8/15/05, Pre-refunded 8/15/97
@ 102.................................................. 307
-------
Louisiana (2.7%):
250 Louisiana State, Series A, GO, 7.00%, 8/1/02, Pre-
refunded 8/1/97 @ 102.................................. 255
1,000 Louisiana State, Series A, GO, 5.00%, 8/1/97, FGIC...... 1,000
1,000 Louisiana State, Recovery District, Sales Tax Revenue,
ETM, 4.25%, 7/1/98, MBIA............................... 1,005
-------
2,260
-------
Maryland (1.4%):
1000 Howard County, Series A, GO, 4.10%, 8/15/97............. 1,000
125 Northeast Maryland Waste Disposal Authority, Resource
Recovery Revenue, 6.75%, 1/1/98, MBIA.................. 127
-------
1,127
-------
Massachusetts (0.2%):
150 Mansfield, GO, 5.50%, 1/15/98, AMBAC.................... 151
-------
Michigan (1.2%):
200 Greater Detroit Resource Recovery Authority, Series A,
4.00%, 12/31/97, AMBAC................................. 200
775 Michigan State Hospital Finance Authority Revenue,
Sisters of Mercy, 4.00%, 8/15/97, MBIA................. 775
-------
975
-------
Minnesota (1.2%):
1,000 Minnesota State, GO, 6.40%, 8/1/97...................... 1,000
-------
Missouri (2.4%):
2,000 Missouri State Environmental Improvement & Energy, Union
Electric Project, Series A, 3.65%*, 10/2/97**.......... 2,000
-------
Montana (0.1%):
100 Great Falls, Tax Increment Urban Renewal, Series A, 102
7.40%, 8/15/03, Pre-refunded 8/15/97 @ 102, MBIA........
-------
Nevada (0.3%):
200 Nevada State, Hoover Uprating, Series B, Limited GO,
7.50%, 10/1/00, Pre-refunded 10/1/97 @ 102............. 205
-------
New York (0.2%):
165 New York City, 1996 Series A, GO, 8.00%, 11/1/00, Pre-
refunded 11/1/97 @ 101.5, AMBAC........................ 169
-------
North Carolina (0.1%):
100 North Carolina State, Municipal Power Agency, No.1
Catawba Electric, 4.20%, 1/2/98, MBIA.................. 100
-------
</TABLE>
Continued
-62-
<PAGE>
AMSOUTH MUTUAL FUNDS
TAX-EXEMPT FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
PRINCIPAL
SHARES OR VALUE OR
PRINCIPAL SECURITY AMORTIZED
AMOUNT DESCRIPTION COST
--------- -------------------------------------------------------- ---------
<C> <S> <C>
MUNICIPAL BONDS, CONTINUED:
Ohio (1.9%):
$ 275 Clermont County, Hospital Facilities Revenue, Mercy
Health System, Series B, 4.40%, 9/1/97, AMBAC.......... $ 275
1,000 Cleveland, Public Power System Revenue, Improvement--1st
Mortgage, 8.38%, 8/1/17, Pre-refunded
8/1/97 @ 102........................................... 1,020
275 Ohio State, Public Facility Commission, Higher Education
Facilities, Series II-C, 4.70%, 12/1/97................ 276
-------
1,571
-------
Oregon (1.2%):
1,000 Oregon State, Department of General Services, Series E,
Certificates of Participation, 6.50%, 9/1/97, AMBAC.... 1,003
-------
Pennsylvania (1.4%):
50 Allegheny County, Higher Education Building Authority,
Allegheny County Community College, 6.25%, 11/1/10,
Pre-refunded 11/1/97 @ 100, MBIA....................... 50
150 Berks County, Municipal Authority, 5.80%, 9/1/98, Pre-
refunded 9/1/97 @ 100.................................. 150
170 Mercer County, GO, 4.85%, 8/1/99, Pre-refunded 8/1/97 @
100, AMBAC............................................. 170
165 North Wales, Water Authority, 7.00%, 11/1/09, Pre-
refunded 11/1/97 @ 102, FGIC........................... 170
500 Pennsylvania State, First Series A, GO, 6.30%, 1/1/98,
AMBAC-TCRS............................................. 505
100 Philadelphia, Municipal Authority, Justice Lease, Series
B, 6.25%, 11/15/97, FGIC............................... 101
-------
1,146
-------
Rhode Island (1.2%):
1,000 Providence, GO, 8.25%, 1/15/98, MBIA.................... 1,020
-------
South Carolina (0.8%):
125 Greenville County, School District, GO, 6.50, 2/1/98.... 127
500 Greenville, Hospital System, Hospital Facilities
Revenue, 7.80%, 5/1/15, Pre-refunded 5/1/98 @ 102,
FGIC................................................... 523
-------
650
-------
South Dakota (0.1%):
100 South Dakota State, Building Authority, ETM, 5.90%,
9/1/97................................................. 100
-------
Tennessee (1.4%):
200 Fayette County, GO, 6.00%, 4/1/98, AMBAC................ 203
750 Johnson City, GO, 4.00%, 12/1/97, MBIA.................. 751
210 Metropolitan Government, Nashville & Davidson County,
10.63%, 12/1/07, Pre-refunded 12/1/97 @ 100............ 214
-------
1,168
-------
Texas (4.0%):
190 Corpus Christi, GO, 7.60%, 11/3/99, Pre-refunded 11/1/97
@ 100.................................................. 192
300 Dallas County, Series A, GO, 4.00%, 8/15/97............. 300
1,000 Harris County, Toll Road, Series B, 6.63%, 8/15/17, Pre-
refunded 8/15/97 @ 102, AMBAC.......................... 1,021
1,000 San Antonio, Electric & Gas Revenue, 10.50%, 2/1/13,
Pre-refunded 2/1/98 @ 102.............................. 1,052
100 San Antonio, GO, 6.30%, 8/1/97.......................... 100
</TABLE>
Continued
-63-
<PAGE>
AMSOUTH MUTUAL FUNDS
TAX-EXEMPT FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
July 31, 1997
(Amounts in Thousands)
<TABLE>
<CAPTION>
PRINCIPAL
SHARES OR VALUE OR
PRINCIPAL SECURITY AMORTIZED
AMOUNT DESCRIPTION COST
--------- -------------------------------------------------------- ---------
<C> <S> <C>
MUNICIPAL BONDS, CONTINUED:
Texas, continued:
$ 200 Tarrant County, Health Facilities Development Corp.,
Series B, 6.88%, 9/1/12, Pre-refunded 9/1/97
@ 102, FGIC............................................ $ 205
175 Texas State Municipal Power Agency, 6.88%, 9/1/07, Pre-
refunded 9/1/97 @ 102, AMBAC........................... 179
110 Texas State Municipal Power Agency, 6.25%, 9/1/10, Pre-
refunded 9/1/97 @ 102, BIG............................. 112
150 Texas State Municipal Power Agency, 6.50%, 9/1/97, BIG.. 150
-------
3,311
-------
Washington (2.3%):
100 Richland, Electric Revenue, 5.25%, 11/1/97, MBIA........ 100
1,700 Seattle, Municipal Light & Power Revenue, 4.10%,
11/1/97................................................ 1,702
100 Washington State, Series R-94A, GO, 3.90%, 8/1/97....... 100
-------
1,902
-------
Wisconsin (1.8%):
500 Milwaukee County, Series A, GO, 4.80%, 9/1/97........... 500
500 Wisconsin State, GO, 7.10%, 5/1/00, Pre-refunded 5/1/98
@ 100.................................................. 512
500 Wisconsin State Health Facilities Authority, Meriter
Hospital, Inc., ETM, 7.45%,12/1/97, FGIC............... 506
-------
1,518
-------
Wyoming (0.6%):
500 University of Wyoming, University Revenues, 4.50%,
6/1/98, MBIA........................................... 503
-------
Total Municipal Bonds (Amortized cost--$31,710)................... 31,710
-------
INVESTMENT COMPANIES (5.9%):
1,948 Federated Tax-Free Fund................................. 1,948
2,993 Goldman Sachs Tax-Free Fund............................. 2,993
-------
Total Investment Companies (Cost--$4,941)......................... 4,941
-------
Total (Amortized cost--$82,905) (a)............................... $82,905
=======
</TABLE>
- --------
Percentages indicated are based on net assets of $83,355.
(a) Cost for federal income tax and financial reporting purposes are the same.
* Variable rate security. Rate presented represents rate in effect at July
31, 1997. Date presented reflects next rate change date.
** Put and demand feastures exist allowing the Fund to require the repurchase
of the instrument within variable time periods including daily, weekly,
monthly and semiannually.
AMBAC--Insured by AMBAC Indemnity Corp. LOC--Letter of Credit
BIG--Bond Insurance Guaranty MBIA--Insured by Municipal Bond
ETM--Escrowed to Maturity Insurance Assoc.
FGIC--Insured by Financial Guaranty PCR--Pollution Control Revenue
Insurance Corp. PLC--Public Limited Co.
FNMA--Insured by Federal National SPA--Standby Purchase Agreement
Mortgage Assoc. TCRS--Transferable Custodial
FSA--Insured by Financial Security Receipts
Assurance
GO--General Obligation
See notes to financial statements.
-64-
<PAGE>
AMSOUTH MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS
July 31, 1997
1. ORGANIZATION:
AmSouth Mutual Funds (the "Trust") was organized on August 5, 1988, and is
registered under the Investment Company Act of 1940, as amended ("the 1940
Act"), as a diversified, open-end investment company established as a
Massachusetts business trust. Between the date of organization and the dates
of commencement of operations, the Trust had no operations other than
incurring organizational expenses and the sale of initial units of beneficial
interest ("shares").
The Trust is authorized to issue an unlimited number of shares without par
value. The Trust currently offers shares of the AmSouth Regional Equity Fund,
the AmSouth Equity Fund, the AmSouth Equity Income Fund, the AmSouth Balanced
Fund, the AmSouth Bond Fund, the AmSouth Government Income Fund, the AmSouth
Limited Maturity Fund, the AmSouth Florida Tax-Free Fund, the AmSouth
Municipal Bond Fund, the AmSouth Prime Obligations Fund, the AmSouth U.S.
Treasury Fund and the AmSouth Tax-Exempt Fund (collectively, "the Funds" and
individually "a Fund"). The AmSouth Alabama Tax-Free Fund and the AmSouth
Small Cap Fund have not yet commenced operations. The AmSouth Capital Growth
Fund commenced operations as of August 4, 1997. Sales of shares of the Funds
may be made to customers of AmSouth Bank, ("AmSouth") and its affiliates, to
all accounts of correspondent banks of AmSouth and to the general public.
The Prime Obligations Fund, the U.S. Treasury Fund and the Tax Exempt Fund
(the "money market funds") each offer two classes of shares: Classic Shares
and Premier Shares. Effective April 1, 1996, the existing shares of the money
market funds, which were previously unclassified, were designated Premier
Shares, and the money market funds commenced offering Classic Shares.
Effective September 2, 1997, the existing shares of the Regional Equity Fund,
the Equity Fund, the Equity Income Fund, the Balanced Fund, the Bond Fund,
the Government Income Fund, the Limited Maturity Fund, the Florida Tax-Free
Fund and the Municipal Bond Fund (the "variable funds") which were previously
unclassified, were designated Premier Shares, and the variable funds
commenced offering Classic Shares. Class B Shares also became effective on
September 2, 1997 in the AmSouth Prime Obligations Fund, the AmSouth Equity
Fund, the AmSouth Regional Equity Fund, the AmSouth Bond Fund, the AmSouth
Balanced Fund, the AmSouth Equity Income Fund and the AmSouth Capital Growth
Fund. Each class of shares in a Fund has identical rights and privileges
except with respect to fees paid under shareholder servicing or distribution
plans, expenses allocable exclusively to each class of shares, voting rights
on matters affecting a single class of shares, and the exchange privilege of
each class of shares.
The AmSouth Regional Equity Fund and the AmSouth Equity Fund seek growth of
capital. The AmSouth Equity Income Fund seeks above average income and
capital appreciation consistent with the preservation of capital. The AmSouth
Balanced Fund seeks to obtain long-term capital growth and to produce a
reasonable amount of current income. The AmSouth Bond Fund and AmSouth
Limited Maturity Fund seek current income, consistent with the preservation
of capital. The AmSouth Government Income Fund seeks to provide a high level
of current income consistent with prudent investment risk. The AmSouth
Florida Tax-Free Fund
Continued
-65-
<PAGE>
AMSOUTH MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS, CONTINUED
July 31, 1997
seeks to produce as high a level of current interest income exempt from
federal income taxes and Florida intangibles taxes as is consistent with the
preservation of capital. The AmSouth Municipal Bond Fund seeks a high level
of current income exempt from federal income taxes. The AmSouth Prime
Obligations Fund and AmSouth U.S. Treasury Fund seek current income with
liquidity and stability of principal. The AmSouth Tax-Exempt Fund seeks to
produce as high a level of current interest income exempt from federal income
taxes as is consistent with the preservation of capital and relative
stability of principal.
2. SIGNIFICANT ACCOUNTING POLICIES:
The following is a summary of significant accounting policies followed by the
Funds in the preparation of their financial statements. The policies are in
conformity with generally accepted accounting principles. The preparation of
financial statements requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of income and expenses for the
period. Actual results could differ from those estimates.
SECURITIES VALUATION:
Investments of the money market funds are valued at either amortized cost,
which approximates market value, or at original cost which, combined with
accrued interest, approximates market value. Under the amortized cost
method, discount or premium is amortized on a constant basis to the
maturity of the security. In addition, the money market 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.
Investments in common stocks, corporate bonds, municipal bonds, commercial
paper and U.S. Government securities of the variable net asset value funds
are valued at their market values determined on the basis of the mean
between the latest available bid and asked prices in the principal market
(closing sales prices if the principal market is an exchange) in which such
securities are normally traded. Investments in investment companies are
valued at their net asset values as reported by such companies. The
differences between cost and market values of such investments are
reflected as unrealized appreciation or depreciation.
SECURITIES TRANSACTIONS AND RELATED INCOME:
Securities transactions are accounted for on the date the security is
purchased or sold (trade date). Interest income is recognized on the
accrual basis and includes, where applicable, the pro rata amortization of
premium or discount. Dividend income is recorded on the ex-dividend date.
Realized gains or losses from sales of securities are determined by
comparing the identified cost of the security lot sold with the net sales
proceeds.
Continued
-66-
<PAGE>
AMSOUTH MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS, CONTINUED
July 31, 1997
REPURCHASE AGREEMENTS:
The Funds may acquire repurchase agreements from member banks of the
Federal Deposit Insurance Corporation and from registered broker/dealers
which AmSouth deems creditworthy under guidelines approved by the Board of
Trustees, subject to the seller's agreement to repurchase such securities
at a mutually agreed-upon date and price. The repurchase price generally
equals the price paid by the Funds plus interest negotiated on the basis of
current short-term rates, which may be more or less than the rate on the
underlying portfolio securities. The seller, under a repurchase agreement,
is required to maintain the value of collateral held pursuant to the
agreement at not less than the repurchase price (including accrued
interest). Securities subject to repurchase agreements are held by the
Funds' custodian or another qualified custodian or in the Federal
Reserve/Treasury book-entry system. Repurchase agreements are considered to
be loans by a Fund under the 1940 Act.
DIVIDENDS TO SHAREHOLDERS:
Dividends from net investment income are declared daily and paid monthly
for the money market funds. Dividends from net investment income are
declared and paid monthly for the variable net asset value funds.
Distributable net realized gains, if any, are declared and distributed
annually.
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 distributions in excess of net realized
gains. To the extent they exceed net investment income and net realized
gains for tax purposes, they are reported as distributions of capital.
As of July, 31 1997, the following reclassifications have been made to
increase (decrease) such amounts with offsetting adjustments made to paid-
in capital:
<TABLE>
<CAPTION>
UNDISTRIBUTED ACCUMULATED NET
NET INVESTMENT REALIZED GAINS
INCOME ON INVESTMENTS
-------------- ---------------
<S> <C> <C>
Regional Equity Fund.......................... $ 2,083 $ (1,037)
Balanced Fund................................. (181,583) 219,123
Bond Fund..................................... 356,959 (211,171)
Government Income............................. (62,440) 61,768
Limited Maturity.............................. 25,919 (32,203)
Florida Tax-Free Fund......................... 5,722 --
</TABLE>
Continued
-67-
<PAGE>
AMSOUTH MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS, CONTINUED
July 31, 1997
FEDERAL INCOME TAXES:
It is the policy of each Fund to qualify or to continue to qualify as a
regulated investment company by complying with the provisions available to
certain investment companies, as defined in applicable sections of the
Internal Revenue Code, and to make distributions of net investment income
and net realized capital gains sufficient to relieve it from all, or
substantially all, federal income taxes.
OTHER:
Expenses that are directly related to one of the Funds are charged directly
to that Fund. Other operating expenses for the Trust are prorated to the
Funds on the basis of relative net assets. Fees paid under a Fund's
shareholder servicing or distribution plans are borne by the specific class
of shares to which they apply.
UNAMORTIZED ORGANIZATIONAL COSTS:
Costs incurred by the Equity Income Fund and Municipal Bond Fund in
connection with their organization and registration of shares have been
deferred and are amortized using the straight-line method over a period of
five years from the commencement of the public offering of shares of the
Funds.
3. PURCHASES AND SALES OF SECURITIES:
Purchases and sales of securities (excluding short-term securities) for the
year ended July 31, 1997 were as follows:
<TABLE>
<CAPTION>
PURCHASES SALES
------------ ------------
<S> <C> <C>
Regional Equity Fund................................. $ 28,778,761 $ 11,284,612
Equity Fund.......................................... 127,511,045 108,826,149
Equity Income Fund (a)............................... 22,750,880 3,493,221
Balanced Fund........................................ 86,424,377 118,995,796
Bond Fund............................................ 56,943,084 50,189,680
Government Income Fund............................... 401,619 4,838,951
Limited Maturity Fund................................ 30,066,966 39,922,502
Florida Tax Free Fund................................ 17,778,771 11,832,457
Municipal Bond Fund (b).............................. 954,714 10,467,202
</TABLE>
- --------
(a) For the period from March 20, 1997 (commencement of operations) to July
31, 1997.
(b) For the period from July 1, 1997 (commencement of operations) to July 31,
1997.
Continued
-68-
<PAGE>
AMSOUTH MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS, CONTINUED
January 31, 1997
4. CAPITAL SHARE TRANSACTIONS:
Transactions in capital shares for the Funds which offer multiple classes of
shares for the year ended July 31, 1997 and the year ended July 31, 1996 were
as follows:
<TABLE>
<CAPTION>
PRIME OBLIGATIONS FUND TREASURY FUND TAX-EXEMPT FUND
------------------------- ------------------------ ------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED PERIOD ENDED YEAR ENDED PERIOD ENDED
JULY 31, JULY 31, JULY 31, JULY 31, JULY 31, JULY 31,
1997 1996 (A) 1997 1996 (A) 1997 1996 (A)
----------- ------------ ---------- ------------ ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
CAPITAL TRANSACTIONS:
CLASSIC SHARES:
Proceeds from shares
issued................ $ 568,041 $ 165,419 $ 24,470 $ 9,207 $ 36,497 $ 9,803
Dividends reinvested... 5,860 1,963 507 222 572 143
Shares redeemed........ (587,948) (191,139) (27,354) (13,986) (26,258) (9,019)
----------- ----------- --------- ----------- --------- ---------
Change in net assets
from investor share
transactions.......... $ (14,047) $ (23,757) $ (2,377) $ (4,557) $ 10,811 $ 927
=========== =========== ========= =========== ========= =========
PREMIER SHARES:
Proceeds from shares
issued................ $ 1,050,377 $ 1,388,943 $ 837,301 $ 1,088,791 $ 165,204 $ 129,166
Dividends reinvested... 1,518 5,460 369 1,751 18 388
Shares redeemed........ (1,113,472) (1,384,702) (896,472) (1,028,499) (153,403) (127,394)
----------- ----------- --------- ----------- --------- ---------
Change in net assets
from investor share
transactions.......... $ (61,577) $ 9,701 $ (58,802) $ 62,043 $ 11,819 $ 2,160
=========== =========== ========= =========== ========= =========
SHARE TRANSACTIONS:
CLASSIC SHARES:
Issued................. 568,041 165,419 24,470 9,207 36,497 9,803
Reinvested............. 5,860 1,963 507 222 572 143
Redeemed............... (587,948) (191,139) (27,354) (13,986) (26,258) (9,019)
----------- ----------- --------- ----------- --------- ---------
Change in Classic
Shares................ (14,047) (23,757) (2,377) (4,557) 10,811 927
=========== =========== ========= =========== ========= =========
PREMIER SHARES:
Issued................. 1,050,377 1,388,943 837,301 1,088,791 165,204 129,166
Reinvested............. 1,518 5,460 369 1,751 18 388
Redeemed............... (1,113,472) (1,384,702) (896,472) (1,028,499) (153,403) (127,394)
----------- ----------- --------- ----------- --------- ---------
Change in Premier
Shares................ (61,577) 9,701 (58,802) 62,043 11,819 2,160
=========== =========== ========= =========== ========= =========
</TABLE>
- --------
(a) Effective April 1, 1996, the Funds' existing shares, which were previously
unclassified, were designated Premier Shares, and the Funds commenced
offering Classic Shares.
Continued
-69-
<PAGE>
AMSOUTH MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS, CONTINUED
July 31, 1997
5. RELATED PARTY TRANSACTIONS:
Investment advisory services are provided to each of the Funds by AmSouth.
Under the terms of the investment advisory agreement, AmSouth is entitled to
receive fees based on a percentage of the average net assets of each of the
Funds.
BISYS Fund Services Limited Partnership d/b/a BISYS Fund Services ("BISYS"),
an Ohio Limited Partnership, and BISYS Fund Services Ohio, Inc. ("BISYS
Ohio") are subsidiaries of the BISYS Group, Inc.
ASO Services Company, a wholly-owned subsidiary of The BISYS Group, Inc.,
serves the Funds as administrator. Under the terms of the administration
agreement, ASO Services Company's fees are computed daily as 0.20% of the
average net assets of each of the Funds. AmSouth and BISYS, with whom certain
officers and trustees of the Trust are affiliated, serve as the Funds' sub-
administrator. Such officers and trustees are paid no fees directly by the
Funds for serving as officers and trustees of the Trust. Pursuant to its
current agreement with the Administrator, AmSouth has assumed certain of the
Administrator's duties, for which AmSouth receives a fee, paid by the
Administrator, calculated at an annual rate of 0.10% of each Fund's average
net assets. AmSouth became Custodian for the Trust on April 17, 1997.
Pursuant to the Custodian Agreement with the Trust, the Custodian receives
compensation from each Fund for such services in an amount equal to an asset-
based fee plux fixed fees charged for certain portfolio transactions and out-
of-pocket expenses. Prior to April 17, 1997 the Union Bank of California
served as the Funds' custodian. Pursuant to its agreement with the
Administrator, BISYS, as sub-administrator, is entitled to compensation as
mutually agreed from time to time by it and the Administrator. BISYS also
serves as the Funds' distributor and is entitled to receive commissions on
sales of shares of the variable net asset value funds. For the year ended
July 31, 1997, BISYS received $1,016,191 from commissions earned on sales of
shares of the Funds' variable net asset value funds of which the entire
amount was reallowed to AmSouth Investment Services, an investment dealer of
the Funds' shares and other dealers of the Funds' shares. BISYS receives no
fees from the Funds for providing distribution services to the Funds. BISYS
Ohio serves the Funds as Transfer Agent and Mutual Fund Accountant. Under the
terms of the Transfer Agent and Fund Accounting Agreement, BISYS Ohio's fees
are based on a percentage of average net assets.
Classic Shares of the Trust are subject to a Shareholder Servicing Plan (the
"Servicing Plan") permitting payment of compensation to financial
institutions that agree to provide certain administrative support services
for their customers or account holders. Each Fund has entered into a specific
arrangement with BISYS for the provision of such services and reimburses
BISYS for its cost of providing these services, subject to a maximum annual
rate 0.25% of the average daily net assets of the Classic Shares of each of
the Funds.
Continued
-70-
<PAGE>
AMSOUTH MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS, CONTINUED
January 31, 1997
Fees may be voluntarily reduced to assist the Funds in maintaining
competitive expense ratios. Information regarding these transactions is as
follows for the year ended July 31, 1997 (amounts in thousands):
<TABLE>
<CAPTION>
INVESTMENT ADVISORY FEES
---------------------------
ANNUAL FEE AS ADMINISTRATION SHAREHOLDER FUND TRANSFER
A PERCENTAGE OF FEES FEES SERVICING FEES ACCOUNTING FEES AGENT AND
AVERAGE DAILY VOLUNTARILY VOLUNTARILY VOLUNTARILY VOLUNTARILY CUSTODY
NET ASSETS REDUCED REDUCED REDUCED REDUCED FEES
--------------- ----------- -------------- -------------- --------------- ---------
<S> <C> <C> <C> <C> <C> <C>
Regional Equity Fund.... 0.80% $ -- $ 51 $-- $-- $ 48
Equity Fund............. 0.80% -- 188 -- -- 111
Equity Income Fund (a).. 0.80% -- -- -- 10 4
Balanced Fund........... 0.80% -- 165 -- -- 95
Bond Fund............... 0.65% 224 119 -- -- 57
Government Income Fund.. 0.65% 48 14 -- 22 15
Limited Maturity Fund... 0.65% $ 74 $40 $ -- $12 $ 26
Florida Tax-Free Fund... 0.65% 183 53 -- 20 28
Municipal Bond Fund (b). 0.65% 70 22 -- -- 4
Prime Obligations Fund.. 0.40% -- -- 183 -- 120
U.S. Treasury Fund...... 0.40% -- -- 17 -- 84
Tax-Exempt Fund......... 0.40% 161 -- 30 3 29
</TABLE>
--------
(a) For the period from March 20, 1997 (commencement of operations) to July
31, 1997.
(b) For the period from July 1, 1997 (commencement of operations) to July 31,
1997.
6. ELIGIBLE DISTRIBUTIONS (UNAUDITED):
The AmSouth Mutual Funds designates the following percentage of distributions
eligible for the dividends received deductions for corporations.
<TABLE>
<CAPTION>
FUND PERCENTAGE
---- ----------
<S> <C>
Regional Equity Fund............................................... 100.00%
Equity Fund........................................................ 100.00%
Equity Income Fund................................................. 13.72%
Balanced Fund...................................................... 34.82%
</TABLE>
7. EXEMPT-INTEREST INCOME DESIGNATIONS (UNAUDITED):
The AmSouth Mutual Funds designate the following exempt-interest dividends
for the taxable year ended July 31, 1997 (amounts in thousands):
<TABLE>
<CAPTION>
TAX-EXEMPT
DISTRIBUTION
------------
<S> <C>
Florida Tax-Free Fund............................................ $2,196
Tax-Exempt Fund.................................................. 2,392
</TABLE>
Continued
-71-
<PAGE>
AMSOUTH MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS, CONTINUED
July 31, 1997
8. FEDERAL INCOME TAX INFORMATION (UNAUDITED):
The accompanying table details distributions from long-term capital gains for
the following funds for the year ended July 31, 1997 (amounts in thousands):
<TABLE>
<CAPTION>
DISTRIBUTIONS
-------------
<S> <C>
Regional Equity Fund............................................ $ 2,165
Equity Fund..................................................... 21,231
Balanced Fund................................................... 14,640
Florida Tax-Free Fund........................................... 74
</TABLE>
At July 31, 1997, the following Funds have capital loss carryforwards which
are available to offset future capital gains, if any (amounts in thousands):
<TABLE>
<S> <C> <C>
CAPITAL LOSS EXPIRES
CARRYFORWARD -------
------------
Bond Fund................................................ $ 28 2004
Bond Fund................................................ 129 2005
Government Income Fund................................... 165 2003
Government Income Fund................................... 239 2004
Government Income Fund................................... 85 2005
Limited Maturity Fund.................................... 478 2002
Limited Maturity Fund.................................... 730 2003
Limited Maturity Fund.................................... 4 2004
Limited Maturity Fund.................................... 304 2005
Prime Obligations Fund................................... 9 2003
</TABLE>
Under current tax law, capital losses realized after October 31, within the
Fund's fiscal year may be deferred and treated as occuring on the first day
of the following fiscal year. The following deferred losses will be treated
as arising on the first day of the fiscal year ended July 31, 1998 (amounts
in thousands):
<TABLE>
<CAPTION>
POST-OCTOBER
CAPITAL LOSSES
--------------
<S> <C>
Bond Fund...................................................... $471
Limited Maturity Fund.......................................... 623
Tax-Exempt Fund................................................ 2
</TABLE>
Continued
-72-
<PAGE>
AMSOUTH MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS, CONTINUED
July 31, 1997
9. ACQUISITION OF AMSOUTH BANK FUNDS
On July 1, 1997, the Municipal Bond Fund issued shares to acquire the assets
and liabilities of AmSouth Bank Tax-Exempt Bond Fund. The following is a
summary of the shares issued, net assets acquired, net asset value per share
and unrealized appreciation as of the date acquired:
<TABLE>
<S> <C>
Shares............................................................ 33,487,807
Net assets........................................................ $334,878,065
Net asset value................................................... $10.00
Unrealized appreciation........................................... $8,309,234
</TABLE>
On July 1, 1997, the Bond Fund issued shares to acquire the assets and
liabilities of AmSouth Bank Fixed Income Fund. The following is a summary of
the shares issued, net assets acquired, net asset value per share and
unrealized appreciation as of the date acquired:
<TABLE>
<S> <C>
Shares............................................................ 15,021,955
Net assets........................................................ $159,533,158
Net asset value................................................... $10.62
Unrealized appreciation........................................... $2,058,965
</TABLE>
On July 1, 1997, the Limited Maturity Fund issued shares to acquire the
assets and liabilities of AmSouth Bank Limited Maturity Fund. The following
is a summary of the shares issued, net assets acquired, net asset value per
share and unrealized appreciation as of the date acquired:
<TABLE>
<S> <C>
Shares............................................................ 9,771,957
Net assets........................................................ $100,553,435
Net asset value................................................... $10.29
Unrealized appreciation........................................... $525,745
</TABLE>
On July 1, 1997, the Equity Fund issued shares to acquire the assets and
liabilities of AmSouth Bank Equity Fund. The following is a summary of the
shares issued, net assets acquired, net asset value per share and unrealized
appreciation as of the date acquired:
<TABLE>
<S> <C>
Shares............................................................ 18,847,588
Net assets........................................................ $408,427,224
Net asset value................................................... $21.67
Unrealized appreciation........................................... $141,393,274
</TABLE>
On February 28, 1997, the Equity Fund issued shares to acquire the assets and
liabilities of AmSouth Bank Florida Equity Fund. The following is a summary
of the shares issued, net assets acquired, net asset value per share and
unrealized appreciation as of the date acquired:
<TABLE>
<S> <C>
Shares............................................................ 474,143
Net assets........................................................ $9,231,567
Net asset value................................................... $19.47
Unrealized appreciation........................................... $5,217,365
</TABLE>
-73-
<PAGE>
AMSOUTH MUTUAL FUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
REGIONAL EQUITY FUND
--------------------------------------------
YEAR ENDED JULY 31,
--------------------------------------------
1997 1996 1995 1994 1993
-------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF
PERIOD.......................... $ 20.95 $ 18.94 $ 16.68 $ 16.74 $ 14.86
-------- ------- ------- ------- -------
INVESTMENT ACTIVITIES
Net investment income........... 0.24 0.26 0.23 0.23 0.19
Net realized and unrealized
gains from investments......... 7.77 2.20 2.26 0.58 2.09
-------- ------- ------- ------- -------
Total from Investment
Activities.................... 8.01 2.46 2.49 0.81 2.28
-------- ------- ------- ------- -------
DISTRIBUTIONS
Net investment income........... (0.24) (0.26) (0.23) (0.23) (0.20)
Net realized gains.............. (0.49) (0.19) -- (0.41) (0.20)
In excess of net realized gains. -- -- -- (0.23) --
-------- ------- ------- ------- -------
Total Distributions............ (0.73) (0.45) (0.23) (0.87) (0.40)
-------- ------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD... $ 28.23 $ 20.95 $ 18.94 $ 16.68 $ 16.74
======== ======= ======= ======= =======
Total Return (excludes sales
charge)......................... 39.02% 13.10% 15.10% 4.87% 15.53%
RATIOS/SUPPLEMENTAL DATA:
Net Assets at end of period
(000).......................... $149,838 $93,584 $68,501 $54,744 $41,347
Ratio of expenses to average net
assets......................... 1.06% 1.05% 1.07% 0.79% 0.80%
Ratio of net investment income
to
average net assets............. 0.99% 1.30% 1.35% 1.36% 1.17%
Ratio of expenses to average net
assets*........................ 1.10% 1.13% 1.15% 1.24% 1.28%
Ratio of net investment income
to
average net assets*............ 0.95% 1.22% 1.27% 0.90% 0.69%
Portfolio turnover............... 10.30% 8.22% 14.25% 5.83% 10.22%
Average commission rate paid (a). $ 0.0760 $0.0827 -- -- --
</TABLE>
- --------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Represents the dollar amount of commissions paid on portfolio transactions
divided by the total number of portfolio shares purchased and sold for
which commissions were charged. Disclosure is not required for periods
ending prior to September 1, 1996.
See notes to financial statements.
-74-
<PAGE>
AMSOUTH MUTUAL FUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
EQUITY FUND
------------------------------------------------
YEAR ENDED JULY 31,
------------------------------------------------
1997 1996 1995 1994 1993
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF
PERIOD...................... $ 17.62 $ 16.75 $ 14.82 $ 14.38 $ 13.40
-------- -------- -------- -------- --------
INVESTMENT ACTIVITIES
Net investment income....... 0.30 0.33 0.33 0.28 0.28
Net realized and unrealized
gains from investments..... 6.77 1.48 2.39 0.83 1.48
-------- -------- -------- -------- --------
Total from Investment
Activities................ 7.07 1.81 2.72 1.11 1.76
-------- -------- -------- -------- --------
DISTRIBUTIONS
Net investment income....... (0.30) (0.33) (0.32) (0.28) (0.29)
Net realized gains.......... (1.04) (0.61) (0.47) (0.39) (0.49)
-------- -------- -------- -------- --------
Total Distributions........ (1.34) (0.94) (0.79) (0.67) (0.78)
-------- -------- -------- -------- --------
NET ASSET VALUE, END OF
PERIOD...................... $ 23.35 $ 17.62 $ 16.75 $ 14.82 $ 14.38
======== ======== ======== ======== ========
Total Return (excludes sales
charge)..................... 42.35% 11.09% 19.27% 7.90% 13.81%
RATIOS/SUPPLEMENTAL DATA:
Net Assets at end of period
(000)...................... $974,985 $374,622 $275,757 $205,611 $153,074
Ratio of expenses to average
net assets................. 1.06% 1.02% 1.03% 0.94% 0.95%
Ratio of net investment
income to
average net assets......... 1.52% 1.86% 2.17% 1.93% 2.08%
Ratio of expenses to average
net assets*................ 1.10% 1.11% 1.11% 1.11% 1.13%
Ratio of net investment
income to
average net assets*........ 1.48% 1.77% 2.09% 1.76% 1.90%
Portfolio turnover........... 24.47% 19.11% 19.46% 11.37% 15.12%
Average commission rate (a).. $ 0.0657 $ 0.0700 -- -- --
</TABLE>
- --------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Represents the dollar amount of commissions paid on portfolio transactions
divided by the total number of portfolio shares purchased and sold for
which commissions were charged. Disclosure is not required for periods
ending prior to September 1, 1996.
See notes to financial statements.
-75-
<PAGE>
AMSOUTH MUTUAL FUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
EQUITY
INCOME
BALANCED FUND FUND
------------------------------------------------ --------------
YEAR ENDED JULY 31, MARCH 20, 1997
------------------------------------------------ TO JULY 31,
1997 1996 1995 1994 1993 1997 (A)
-------- -------- -------- -------- -------- --------------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD.... $ 13.03 $ 12.76 $ 11.81 $ 11.86 $ 11.12 $ 10.00
-------- -------- -------- -------- -------- -------
INVESTMENT ACTIVITIES
Net investment income.. 0.48 0.47 0.47 0.42 0.44 0.07
Net realized and
unrealized gains from
investments........... 2.78 0.58 1.24 0.18 0.80 1.71
-------- -------- -------- -------- -------- -------
Total from Investment
Activities........... 3.26 1.05 1.71 0.60 1.24 1.78
-------- -------- -------- -------- -------- -------
DISTRIBUTIONS
Net investment income.. (0.50) (0.47) (0.46) (0.42) (0.45) (0.06)
Net realized gain...... (0.58) (0.31) (0.30) (0.23) (0.05) --
-------- -------- -------- -------- -------- -------
Total Distributions... (1.08) (0.78) (0.76) (0.65) (0.50) (0.06)
-------- -------- -------- -------- -------- -------
NET ASSET VALUE, END OF
PERIOD................. $ 15.21 $ 13.03 $ 12.76 $ 11.81 $ 11.86 11.72
======== ======== ======== ======== ======== =======
Total Return (excludes
sales charge).......... 26.42% 8.37% 15.27% 5.13% 11.47% 17.81%(c)
RATIOS/SUPPLEMENTAL
DATA:
Net Assets at end of
period (000).......... $372,769 $338,425 $295,509 $236,306 $179,134 $22,273
Ratio of expenses to
average net assets.... 1.05% 0.98% 0.94% 0.84% 0.84% 1.30%(b)
Ratio of net investment
income to average net
assets................ 3.49% 3.61% 3.91% 3.56% 3.90% 2.13%(b)
Ratio of expenses to
average net assets*... 1.10% 1.11% 1.12% 1.11% 1.12% 1.51%(b)
Ratio of net investment
income to average net
assets*............... 3.44% 3.48% 3.73% 3.28% 3.62% 1.92%(b)
Portfolio turnover...... 25.00% 20.47% 16.97% 14.43% 11.09% 27.38%
Average commission rate
paid (d)............... $ 0.0734 $ 0.0773 -- -- -- $0.0600
</TABLE>
- --------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Annualized
(c) Not annualized.
(d) Represents the dollar amount of commissions paid on portfolio transactions
divided by the total number of portfolio shares purchased and sold for
which commissions were charged. Disclosure is not required for periods
ending prior to September 1, 1996.
See notes to financial statements.
-76-
<PAGE>
AMSOUTH MUTUAL FUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
BOND FUND
---------------------------------------------
YEAR ENDED JULY 31,
---------------------------------------------
1997 1996 1995 1994 1993
-------- -------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF
PERIOD......................... $ 10.54 $ 10.83 $ 10.59 $ 11.29 $ 11.29
-------- -------- ------- ------- -------
INVESTMENT ACTIVITIES
Net investment income.......... 0.65 0.65 0.69 0.69 0.71
Net realized and unrealized
gains (losses)
from investments.............. 0.42 (0.18) 0.28 (0.66) 0.33
-------- -------- ------- ------- -------
Total from Investment
Activities................... 1.07 0.47 0.97 0.03 1.04
-------- -------- ------- ------- -------
DISTRIBUTIONS
Net investment income.......... (0.69) (0.65) (0.69) (0.70) (0.71)
Net realized gains............. -- (0.11) (0.04) (0.03) (0.33)
-------- -------- ------- ------- -------
Total Distributions........... (0.69) (0.76) (0.73) (0.73) (1.04)
-------- -------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD.. $ 10.92 $ 10.54 $ 10.83 $ 10.59 $ 11.29
======== ======== ======= ======= =======
Total Return (excludes sales
charge)........................ 10.48% 4.40% 9.70% 0.23% 9.80%
RATIOS/SUPPLEMENTAL DATA:
Net Assets at end of period
(000)......................... $311,881 $132,737 $94,671 $79,472 $65,777
Ratio of expenses to average
net assets.................... 0.75% 0.75% 0.75% 0.78% 0.78%
Ratio of net investment income
to average
net assets.................... 6.10% 6.12% 6.63% 6.31% 6.37%
Ratio of expenses to average
net assets*................... 0.98% 0.98% 0.98% 1.01% 1.01%
Ratio of net investment income
to average
net assets*................... 5.87% 5.89% 6.40% 6.08% 6.14%
Portfolio turnover.............. 34.62% 9.60% 17.70% 30.90% 14.98%
</TABLE>
- --------
*During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
See notes to financial statements.
-77-
<PAGE>
AMSOUTH MUTUAL FUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
GOVERNMENT INCOME FUND
------------------------------------------
YEAR ENDED JULY 31, OCTOBER 1, 1993
------------------------- TO JULY 31,
1997 1996 1995 1994 (A)
------- ------- ------- ---------------
<S> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERI-
OD................................ $ 9.40 $ 9.54 $ 9.48 $ 10.00
------- ------- ------- -------
INVESTMENT ACTIVITIES
Net investment income............. 0.58 0.66 0.68 0.54
Net realized and unrealized gains
(losses) from
investments...................... 0.35 (0.20) 0.08 (0.57)
------- ------- ------- -------
Total from Investment Activities. 0.93 0.46 0.76 (0.03)
------- ------- ------- -------
DISTRIBUTIONS
Net investment income............. (0.58) (0.59) (0.70) (0.33)
Tax return of capital............. -- (0.01) -- (0.16)
------- ------- ------- -------
Total Distributions.............. (0.58) (0.60) (0.70) (0.49)
------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD..... $ 9.75 $ 9.40 $ 9.54 $ 9.48
======= ======= ======= =======
Total Return (excludes sales
charge)........................... 10.21% 4.91% 8.43% (0.26%)(c)
RATIOS/SUPPLEMENTAL DATA:
Net Assets at end of period (000). $11,622 $15,752 $16,679 $15,465
Ratio of expenses to average net
assets........................... 0.69% 0.65% 0.58% 0.37%(b)
Ratio of net investment income to
average net assets............... 5.98% 6.81% 7.18% 6.56%(b)
Ratio of expenses to average net
assets*.......................... 1.29% 1.10% 1.19% 1.22%(b)
Ratio of net investment income to
average net assets*.............. 5.38% 6.36% 6.57% 5.71%(b)
Portfolio turnover................. 2.96% 78.31% 27.32% 122.94%
</TABLE>
- --------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Annualized.
(c) Not annualized.
See notes to financial statements.
-78-
<PAGE>
AMSOUTH MUTUAL FUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
LIMITED MATURITY FUND
--------------------------------------------
YEAR ENDED JULY 31,
--------------------------------------------
1997 1996 1995 1994 1993
-------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD..... $ 10.31 $ 10.41 $ 10.23 $ 10.81 $ 10.81
-------- ------- ------- ------- -------
INVESTMENT ACTIVITIES
Net investment income... 0.58 0.58 0.58 0.54 0.60
Net realized and
unrealized gains
(losses)
from investments....... 0.14 (0.10) 0.17 (0.45) 0.09
-------- ------- ------- ------- -------
Total from Investment
Activities............ 0.72 0.48 0.75 0.09 0.69
-------- ------- ------- ------- -------
DISTRIBUTIONS
Net investment income... (0.61) (0.57) (0.57) (0.54) (0.61)
Net realized gains...... -- (0.01) -- -- (0.08)
In excess of net
realized gains......... -- -- -- (0.13) --
-------- ------- ------- ------- -------
Total Distributions.... (0.61) (0.58) (0.57) (0.67) (0.69)
-------- ------- ------- ------- -------
NET ASSET VALUE, END OF
PERIOD.................. $ 10.42 $ 10.31 $ 10.41 $ 10.23 $ 10.81
======== ======= ======= ======= =======
Total Return (excludes
sales charge)........... 7.25% 4.74% 7.65% 0.77% 6.72%
RATIOS/SUPPLEMENTAL DATA:
Net Assets at end of
period (000)........... $138,675 $46,005 $59,798 $51,660 $53,933
Ratio of expenses to
average
net assets............. 0.77% 0.76% 0.80% 0.79% 0.69%
Ratio of net investment
income to average
net assets............. 5.65% 5.48% 5.69% 5.05% 5.67%
Ratio of expenses to
average net assets*.... 1.02% 0.99% 1.03% 1.02% 1.03%
Ratio of net investment
income to average
net assets*............ 5.40% 5.25% 5.46% 4.82% 5.33%
Portfolio turnover....... 64.89% 29.56% 38.11% 48.06% 141.27%
</TABLE>
- --------
*During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
See notes to financial statements.
-79-
<PAGE>
AMSOUTH MUTUAL FUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
MUNICIPAL
FLORIDA TAX-FREE FUND FUND BOND
--------------------------------- ------------
YEAR YEAR SEPTEMBER 30,
ENDED ENDED 1994 TO JULY 1, 1997
JULY 31, JULY 31, JULY 31, TO JULY 31,
1997 1996 1995 (A) 1997 (A)
-------- -------- ------------- ------------
<S> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF
PERIOD......................... $ 10.30 $ 10.32 $ 10.00 $ 10.00
------- ------- ------- -------
INVESTMENT ACTIVITIES
Net investment income.......... 0.45 0.45 0.34 0.04
Net realized and unrealized
gains (losses) from
investments................... 0.24 (0.01) 0.30 0.15
------- ------- ------- -------
Total from Investment
Activities................... 0.69 0.44 0.64 0.19
------- ------- ------- -------
DISTRIBUTIONS
Net investment income.......... (0.48) (0.45) (0.32) (0.04)
Net realized gains............. (0.01) (0.01) -- --
------- ------- ------- -------
Total Distributions........... $ (0.49) (0.46) (0.32) (0.04)
------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD.. 10.50 $ 10.30 $ 10.32 10.15
======= ======= ======= =======
Total Return (excludes sales
charge)........................ 6.89% 4.24% 6.53%(c) 1.86%(c)
RATIOS/SUPPLEMENTAL DATA:
Net Assets at end of period
(000)......................... $53,688 $48,869 $48,333 337,933
Ratio of expenses to average
net assets.................... 0.57% 0.59% 0.70%(b) 0.71%(b)
Ratio of net investment income
to average net assets......... 4.36% 4.33% 4.16%(b) 4.31%(b)
Ratio of expenses to average
net assets*................... 1.06% 1.04% 1.01%(b) 1.04%(b)
Ratio of net investment income
to average net assets*........ 3.87% 3.88% 3.86%(b) 3.98%(b)
Portfolio turnover.............. 24.05% 12.21% 2.33% 0.31%
</TABLE>
- --------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Annualized.
(c) Not annualized.
See notes to financial statements.
-80-
<PAGE>
AMSOUTH MUTUAL FUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
PRIME OBLIGATIONS FUND
-----------------------------------------------------------------------------------
YEAR ENDED JULY 31,
-----------------------------------------------------------------------------------
1997 1996 1995 1994 1993
--------------------- ------------------------ -------- -------- --------
CLASSIC(A) PREMIER(A) CLASSIC(A) PREMIER(A)
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD..... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
-------- -------- -------- -------- -------- -------- --------
INVESTMENT ACTIVITIES
Net investment income... 0.048 0.049 0.016 0.050 0.050 0.029 0.027
-------- -------- -------- -------- -------- -------- --------
DISTRIBUTIONS
Net investment income... (0.048) (0.049) (0.016) (0.050) (0.050) (0.029) (0.027)
-------- -------- -------- -------- -------- -------- --------
NET ASSET VALUE,
END OF PERIOD........... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
======== ======== ======== ======== ======== ======== ========
Total Return............. 4.90% 5.00% 5.07%(d) 5.10% 5.14% 2.94% 2.76%
RATIOS/SUPPLEMENTAL DATA:
Net Assets at end of
period (000)........... $111,027 $416,966 $125,075 $478,542 $617,673 $577,331 $456,428
Ratio of expenses to
average
net assets............. 0.78% 0.68% 0.81%(b) 0.71% 0.69% 0.70% 0.71%
Ratio of net investment
income to average net
assets................. 4.79% 4.89% 4.61%(b) 5.00% 5.04% 2.92% 2.73%
Ratio of expenses to
average
net assets*............ 0.93% (c) 0.96%(b) (c) (c) (c) (c)
Ratio of net investment
income to average net
assets*................ 4.64% (c) 4.46%(b) (c) (c) (c) (c)
</TABLE>
- --------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Effective April 1, 1996, the Fund's existing shares, which were previously
unclassified, were designated as Premier Shares, and the Fund commenced
offering Classic Shares.
(b) Annualized.
(c) There were no waivers during the period.
(d) Represents total return for the Premier Shares for the period from August
1, 1995 to March 31, 1996 plus the total return for the Classic Shares for
the period from April 1, 1996 to July 31, 1996. Total return for the
Classic Shares for the period April 1, 1996 (commencement of operations)
to July 31, 1996 was 1.55%.
See notes to financial statements.
-81-
<PAGE>
AMSOUTH MUTUAL FUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
U.S. TREASURY FUND
-----------------------------------------------------------------------------------
YEAR ENDED JULY 31,
-----------------------------------------------------------------------------------
1997 1996 1995 1994 1993
--------------------- ------------------------ -------- -------- --------
CLASSIC(A) PREMIER(A) CLASSIC(A) PREMIER(A)
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD..... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
------- -------- ------- -------- -------- -------- --------
INVESTMENT ACTIVITIES
Net investment income... 0.045 0.046 0.015 0.048 0.048 0.028 0.027
------- -------- ------- -------- -------- -------- --------
DISTRIBUTIONS
Net investment income... (0.045) (0.046) (0.015) (0.048) (0.048) (0.028) (0.027)
------- -------- ------- -------- -------- -------- --------
NET ASSET VALUE, END OF
PERIOD.................. $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
======= ======== ======= ======== ======== ======== ========
Total Return............. 4.60% 4.70% 4.90%(d) 4.93% 4.90% 2.80% 2.69%
RATIOS/SUPPLEMENTAL DATA:
Net Assets at end of
period (000)........... $ 9,885 $309,361 $12,263 $368,162 $322,939 $300,603 $404,473
Ratio of expenses to
average
net assets............. 0.79% 0.69% 0.82%(b) 0.71% 0.70% 0.71% 0.72%
Ratio of net investment
income to average net
assets................. 4.50% 4.60% 4.44%(b) 4.82% 4.81% 2.77% 2.66%
Ratio of expenses to
average
net assets*............ 0.94% (c) 0.97%(b) (c) (c) (c) (c)
Ratio of net investment
income to average net
assets*................ 4.35% (c) 4.29%(b) (c) (c) (c) (c)
</TABLE>
- --------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Effective April 1, 1996, the Fund's existing shares, which were previously
unclassified, were designated as Premier Shares, and the Fund commenced
offering Classic Shares.
(b) Annualized.
(c) There were no waivers during the period.
(d) Represents total return for the Premier Shares for the period from August
1, 1995 to March 31, 1996 plus the total return for the Classic Shares for
the period from April 1, 1996 to July 31, 1996. Total return for the
Classic Shares for the period April 1, 1996 (commencement of operations)
to July 31, 1996 was 1.49%
See notes to financial statements.
-82-
<PAGE>
AMSOUTH MUTUAL FUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
TAX EXEMPT FUND
------------------------------------------------------------------------
YEAR ENDED JULY 31,
------------------------------------------------------------------------
1997 1996 1995 1994 1993
--------------------- ------------------------ ------- ------- -------
CLASSIC(A) PREMIER(A) CLASSIC(A) PREMIER(A)
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD.... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
------- ------- ------- ------- ------- ------- -------
INVESTMENT ACTIVITIES
Net investment income.. 0.030 0.031 0.010 0.031 0.032 0.019 0.021
------- ------- ------- ------- ------- ------- -------
DISTRIBUTIONS
Net investment income.. (0.030) (0.031) (0.010) (0.031) (0.032) (0.019) (0.021)
------- ------- ------- ------- ------- ------- -------
NET ASSET VALUE, END OF
PERIOD................. $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
======= ======= ======= ======= ======= ======= =======
Total Return............ 3.04% 3.15% 3.12%(c) 3.15% 3.22% 1.95% 2.16%
RATIOS/SUPPLEMENTAL
DATA:
Net Assets at end of
period (000).......... $27,926 $55,429 $17,116 $43,611 $57,640 $60,923 $48,151
Ratio of expenses to
average net assets.... 0.62% 0.52% 0.68%(b) 0.54% 0.54% 0.57% 0.49%
Ratio of net investment
income to average net
assets................ 3.00% 3.10% 2.82%(b) 3.11% 3.15% 1.93% 2.12%
Ratio of expenses to
average net assets*... 0.97% 0.72% 1.03%(b) 0.74% 0.74% 0.77% 0.78%
Ratio of net investment
income to average net
assets*............... 2.65% 2.90% 2.47%(b) 2.91% 2.95% 1.73% 1.83%
</TABLE>
- --------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Effective April 1, 1996, the Fund's existing shares, which were previously
unclassified, were designated as Premier Shares, and the Fund commenced
offering Classic Shares.
(b) Annualized.
(c) Represents total return for the Premier Shares for the period from August
1, 1995 to March 31, 1996 plus the total return for the Classic Shares for
the period from April 1, 1996 to July 31, 1996. Total return for the
period April 1, 1996 (commencement of operations) to July 31, 1996 was
0.95%.
See notes to financial statements.
-83-
<PAGE>
INVESTMENT ADVISOR
[LOGO OF AMSOUTH]
AmSouth Bank
1901 Sixth Avenue North
Birmingham, AL 35203
DISTRIBUTOR
BISYS Fund Services
3435 Stelzer Road
Columbus, OH 43219
LEGAL COUNSEL
Ropes & Gray
One Franklin Square
1301 K Street, N.W.
Suite 800 East
Washington, DC 20005
TRANSFER AGENT
BISYS Fund Services Ohio, Inc.
3435 Stelzer Road
Columbus, OH 43219
AUDITORS
Coopers & Lybrand L.L.P.
100 East Broad Street
Columbus, OH 43215
[LOGO OF AMSOUTH
MUTUAL FUNDS]
ANNUAL REPORT
July 31, 1997
[LOGO OF AMSOUTH]
AMSOUTH BANK
INVESTMENT ADVISOR
9/97
