[ACHIEVEMENT FUNDS LOGO OMITTED]
ANNUAL REPORT TO SHAREHOLDERS
JANUARY 31, 1998
[PHOTO OF MOUNTAINS OMITTED]
[PHOTO OF ARCH OF ROCK OMITTED]
[PHOTO OF GREEN MOUNTAINS OMITTED]
<PAGE>
TABLE OF CONTENTS
Letter to Shareholders ............................. 1
Fund Objectives .................................... 3
Performance Highlights ............................. 4
Investment Adviser's Report ........................ 5
Management's Discussion & Analysis ................. 8
Financial Statements ............................... 23
Notes to Financial Statements ...................... 51
- -------------------------------------------------------
The Achievement Funds
Annual Report
JANUARY 31, 1998
STOCK AND BALANCED FUNDS
The Achievement Equity Fund
The Achievement Balanced Fund
BOND FUNDS
The Achievement Intermediate Term Bond Fund
The Achievement Short Term Bond Fund
The Achievement Short Term Municipal Bond Fund
The Achievement Idaho Municipal Bond Fund
The Achievement Municipal Bond Fund
[LOGO OMITTED]
THE ACHIEVEMENT FUNDS
For Your Life's Journey
<PAGE>
LETTER TO SHAREHOLDERS
[PHOTO OF FREDERICK A. MORETON, JR., CHAIRMAN AND
JOHN L. RUDISILL, MANAGER OMITTED]
THE ACHIEVEMENT FUNDS CELEBRATED THEIR THREE-YEAR ANNIVERSARY IN DECEMBER 1997,
AND COMPLETED FISCAL 1997-1998 WITH ANOTHER YEAR OF SOLID PERFORMANCE. OUR FUNDS
HAVE BENEFITED GREATLY DURING OUR SHORT THREE-YEAR EXISTENCE FROM AN
UNPRECEDENTED MARKET AND, MORE FUNDAMENTALLY, FROM THE IMPACT OF THE EVER
GROWING INVESTING HABITS OF THE LARGEST POPULATION EXPLOSION IN THE 20TH CENTURY
- -- THE "BABY BOOMERS." THIS MASSIVE GROUP OF CONSUMERS IS MAKING A RADICAL SHIFT
IN HOW THEY USE DISPOSABLE INCOME FROM ONE OF "SPENDERS" TO ONE OF "INVESTORS."
AS THIS TREND CONTINUES INTO AND BEYOND THE YEAR 2000, EXPERTS IN THE FIELD
PREDICT THAT MORE AND MORE FUNDS WILL FLOW INTO THE INVESTMENT VEHICLE OF CHOICE
AMONG THE BABY BOOMERS -- MUTUAL FUNDS.
OUR FUNDS ARE MANAGED BY FIRST SECURITY INVESTMENT MANAGEMENT, INC. WITH AN EYE
TOWARD THESE LONG-TERM CONSUMER TRENDS AND WITH THE UNDERSTANDING THAT LONG-TERM
PERFORMANCE CAN ONLY BE SUSTAINED BY FOLLOWING A DISCIPLINED AND CONSISTENT
MANAGEMENT STYLE. EACH OF THE ACHIEVEMENT FUNDS IS MANAGED WITH A SPECIFIC
INVESTMENT OBJECTIVE IN MIND. THE ACCOMPANYING REPORT BY STERLING K. JENSON,
PRESIDENT OF FIRST SECURITY INVESTMENT MANAGEMENT, INC., PROVIDES MORE
INFORMATION ON EACH OF THE FUNDS AS WELL AS AN OUTLOOK FOR THE STOCK AND BOND
MARKETS.
AS THE ACHIEVEMENT FUNDS MOVE INTO THEIR FOURTH YEAR, WE CONTINUE TO LOOK FOR
WAYS TO IMPROVE AND EXPAND OUR PROGRAM. IN THIS REGARD, WE PLAN TO INTRODUCE A
SECOND RETAIL CLASS OF SHARES DURING THE SECOND QUARTER OF 1998 FOR THE CORE
EQUITY AND BOND FUNDS -- THE ACHIEVEMENT EQUITY FUND, THE ACHIEVEMENT BALANCED
FUND, THE ACHIEVEMENT IDAHO MUNICIPAL BOND FUND, AND THE ACHIEVEMENT MUNICIPAL
BOND FUND. THIS NEW RETAIL CLASS IS BEING DEVELOPED IN RESPONSE TO A GROWING
DEMAND OVER THE LAST YEAR OR TWO BY THE RETAIL CONSUMERS WHO WISH TO INVEST IN
FUNDS THAT DO NOT CHARGE A FRONT-END LOAD, YET WANT THE ABILITY TO RECEIVE
PROFESSIONAL INVESTMENT ADVICE. WE ARE EXCITED ABOUT THESE AND OTHER CHANGES
PLANNED FOR 1998.
1
<PAGE>
WE GREATLY APPRECIATE THE ONGOING SUPPORT OF YOU, OUR SHAREHOLDERS, AND THE
DIRECTION PROVIDED BY THE ACHIEVEMENT FUNDS BOARD OF TRUSTEES, AS WE ENJOY
CONTINUED SUCCESS IN THIS EXCITING MARKETPLACE AND THE MUTUAL FUND INDUSTRY.
YOUR COMMENTS AND QUESTIONS ARE ALWAYS WELCOME AND SHOULD BE DIRECTED TO YOUR
FINANCIAL ADVISER OR OUR SHAREHOLDER SERVICES PERSONNEL AT 1 (800) 472-0577.
/S/ SIGNATURE
FREDERICK A. MORETON, JR.
CHAIRMAN OF THE BOARD OF TRUSTEES
The Achievement Funds Trust
/S/ SIGNATURE
JOHN L. RUDISILL
SENIOR VICE PRESIDENT AND MANAGER
Mutual Fund Center
First Security Corporation
2
<PAGE>
FUND OBJECTIVES THE ACHIEVEMENT FUNDS
STOCK AND BALANCED FUNDS
- --------------------------------------------------------------------------------
THE ACHIEVEMENT EQUITY FUND
To provide long-term capital appreciation with current income as a secondary
consideration in selecting portfolio securities.
THE ACHIEVEMENT BALANCED FUND
To provide a total return (both income and capital appreciation) consistent with
prudent investment risk.
BOND FUNDS
- --------------------------------------------------------------------------------
THE ACHIEVEMENT INTERMEDIATE TERM BOND FUND
To provide income consistent with prudent investment risk and maintenance of
appropriate liquidity.
THE ACHIEVEMENT SHORT TERM BOND FUND
To preserve principal value and maintain a high degree of liquidity while
providing current income.
THE ACHIEVEMENT SHORT TERM MUNICIPAL BOND FUND
To provide as high a level of current income that is exempt from Federal income
tax as is consistent with preservation of capital.
THE ACHIEVEMENT IDAHO MUNICIPAL BOND FUND
To provide as high a level of current income exempt from Federal and Idaho State
income taxes as is consistent with preservation of capital.
THE ACHIEVEMENT MUNICIPAL BOND FUND
To provide as high a level of current income that is exempt from Federal income
tax as is consistent with preservation of capital.
================================================================================
TERMS YOU NEED TO KNOW
TOTAL RETURN is the change in value of an investment from the beginning to the
end of a period, assuming the reinvestment of all distributions.
NET ASSET VALUE (NAV) is the market worth of one share of a mutual fund. This
figure is derived by taking a fund's total assets - securities, cash and any
accrued earnings - deducting liabilities, and dividing by the number of shares
outstanding.
YIELD is the percentage rate at which a fund's portfolio earns income, based on
a formula set by the Securities and Exchange Commission.
3
<PAGE>
PERFORMANCE HIGHLIGHTS OF THE FUNDS
FOR THE PERIOD ENDED JANUARY 31, 1998
<TABLE>
<CAPTION>
===================================================================================================================================
TOTAL TOTAL RETURN NAV SHARE NAV SHARE
THE ACHIEVEMENT FUNDS NET ASSETS ANNUALIZED TOTAL RETURN PRICE PRICE 30-DAY DISTRIBUTIONS
(IN MILLIONS) SINCE INCEPTION ONE YEAR 1/31/97 1/31/98 SEC YIELD PER SHARE
===================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C>
EQUITY INSTITUTIONAL $195.5 24.90% 22.14% $14.03 $15.34 0.59% $1.78
FUND RETAIL CLASS A 9.8 24.25 21.78 14.04 15.34 0.34 1.74
- -----------------------------------------------------------------------------------------------------------------------------------
BALANCED INSTITUTIONAL 175.8 17.89 17.28 12.01 13.10 2.10 0.94
FUND RETAIL CLASS A 3.9 17.23 16.92 12.00 13.08 1.77 0.91
- -----------------------------------------------------------------------------------------------------------------------------------
INTERMEDIATE INSTITUTIONAL 161.7 8.35 8.82 10.37 10.63 5.19 0.62
TERM BOND FUND RETAIL CLASS A 2.8 7.68 8.60 10.40 10.66 4.77 0.60
- -----------------------------------------------------------------------------------------------------------------------------------
SHORT TERM INSTITUTIONAL 50.9 6.22 6.25 10.01 10.05 5.06 0.57
BOND FUND RETAIL CLASS A .2 5.82 6.04 10.00 10.04 4.74 0.55
- -----------------------------------------------------------------------------------------------------------------------------------
SHORT TERM INSTITUTIONAL 15.6 4.70 4.38 10.08 10.05 3.38 0.45
BOND FUND RETAIL CLASS A .2 4.52 4.08 10.10 10.08 3.09 0.42
- -----------------------------------------------------------------------------------------------------------------------------------
IDAHO MUNICIPAL INSTITUTIONAL 26.1 7.94 9.06 10.41 10.82 4.21 0.51
BOND FUND RETAIL CLASS A 9.3 7.22 8.84 10.44 10.85 3.81 0.49
- -----------------------------------------------------------------------------------------------------------------------------------
MUNICIPAL INSTITUTIONAL 63.0 8.99 9.90 10.02 10.38 4.69 0.60
BOND FUND RETAIL CLASS A 9.9 9.09 9.78 10.01 10.38 4.27 0.58
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
THE ACHIEVEMENT FUNDS TOTAL RETURN ANNUALIZED SINCE INCEPTION
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
EQUITY FUND INSTITUTIONAL (12/28/94) 24.90%
RETAIL CLASS A (3/6/95) 24.25%
- ---------------------------------------------------------------------------------------------------------------------------
BALANCED FUND INSTITUTIONAL (12/28/94) 17.89%
RETAIL CLASS A (3/6/95) 17.23%
- ---------------------------------------------------------------------------------------------------------------------------
INTERMEDIATE TERM INSTITUTIONAL (12/28/94) 8.35%
BOND FUND RETAIL CLASS A (3/6/95) 7.68%
- ---------------------------------------------------------------------------------------------------------------------------
SHORT TERM BOND FUND INSTITUTIONAL (12/28/94) 6.22%
RETAIL CLASS A (3/6/95) 5.82%
- ---------------------------------------------------------------------------------------------------------------------------
SHORT TERM MUNICIPAL INSTITUTIONAL (12/28/94) 4.70%
BOND FUND RETAIL CLASS A (3/6/95) 4.52%
- ---------------------------------------------------------------------------------------------------------------------------
IDAHO MUNICIPAL INSTITUTIONAL (12/28/94) 7.94%
BOND FUND RETAIL CLASS A (3/6/95) 7.22%
- ---------------------------------------------------------------------------------------------------------------------------
MUNICIPAL BOND FUND INSTITUTIONAL (11/1/96) 8.99%
RETAIL CLASS A (11/4/96) 9.09%
0 5 10 15 20 25 30
Percent (%)
<FN>
PERFORMANCE DATA REPRESENT PAST RESULTS AND ARE NO GUARANTEE OF FUTURE RESULTS. INVESTMENT RETURN AND PRINCIPAL VALUE
WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
YIELD FLUCTUATES. YIELD REFLECTS THE PORTFOLIO'S EARNING POWER, NET OF FUND EXPENSES.
</FN>
</TABLE>
4
<PAGE>
THE ACHIEVEMENT FUNDS
INVESTMENT ADVISER'S REPORT
[PHOTO OF STERLING K. JENSON OMITTED]
Have we finally arrived in Camelot? Is the investing landscape fundamentally
different now from any point in the past 50 years? The market completed its
third calendar year of plus 20 percent returns in December, 1997, an
unprecedented run.
Some say that these days you don't have bulls and bears, you have believers in
the "New Era" and people who don't think it's permanent. New Era thinking
provides for a continuation of the perplexing strong economic growth with modest
inflation. Over the last 50 years, it's been inflation and the strong economy
that's caused interest rates to go up, and in turn ended each bull market.
What's peculiar here is that with strong growth we are actually experiencing
some mild deflation.
The stock market actually peaked in August then struggled the remaining five
months. Cracks appeared in August with some high-profile earnings
disappointments. On October 27, a stunning meltdown in Hong Kong triggered a
correction which rolled around the world and into the United States. The Dow
plunged 554 points, or 7.2%, its biggest point-drop ever, triggering the New
York Stock Exchange's circuit breakers for the first time. With the industrial
average down that day 13.3% from its August 6th high, it was the first time
since the bull market began in 1990 that the average was off its closing high by
at least 10%, the decline most people consider a correction. Then, just as
abruptly, the stock market staged a sharp comeback the next day, soaring 4.7%.
For investors who braved the overseas stock markets, 1997 will certainly be a
year to remember. Those who turned to the Asian markets in search of high
returns suffered the most severe losses. By year end, Malaysia's stock-market
index had fallen 52%, Thailand 55%, Indonesia 37%, South Korea 42%, and Japan
21% in local currency terms.
In the U.S. the eye-popping index returns masked a two-tier market. The biggest
stocks were the leaders, leaving their smaller counterparts languishing in their
wake. The year's winners proved to be almost the same big companies that have
led the charge throughout the bull market; General Electric, Gillette, Coca-Cola
and IBM. Stocks that disappointed in any fashion were figuratively "taken out
behind the woodshed to be shot."
STOCK MARKET OUTLOOK FOR 1998
- -------------------------------------------------------------------------------
Perhaps the only certain prediction for 1998 is that lots of volatility should
continue and investors can expect to experience many sleepless nights. On nearly
a third of the trading sessions in 1997, the Dow rose or fell more than 1%, one
of the most volatile years in history. Expect more of the same in 1998. In 1998
avoiding the losers will almost be more important than picking the winners. At
year end, the market traded at 19 times estimated 1998 earnings, a year-end
record and up from 16 times earnings a year earlier. This suggests that New Era
or not, the stock market isn't well positioned to absorb any disappointment.
5
<PAGE>
[LINE GRAPH DEPICTING THE S&P 500 INDEX OMITTED]
Index Level
1/31/97 786.16
4/30/97 801.34
7/31/97 954.29
10/31/97 914.62
1/31/98 980.28
The fundamentals of the past, though a bit stretched, should continue to
favorably impact the stock market into the foreseeable future. I would like to
highlight four factors that should keep the positive direction intact.
POSITIVE CASH FLOW
- -------------------------------------------------------------------------------
Merger mania continues. In 1997 an amazing 10,700 transactions valued at $919
billion were announced in the U.S., up 47% from last year's $626 billion.
Blockbuster deals included the acquisition of companies like Dean Witter, MCI
Communications, Barnett Banks, CoreStates Financial, U.S. Bancorp, Salomon, and
ITT. This megatrend of mergers should continue into 1998 as corporations search
for ways to grow top line revenues. This shrinkage of stocks outstanding and
bidding up of acquired company stock prices should be positive for the markets.
In addition, stocks should continue to be the investment of choice for Baby
Boomer 401(k) investors, safe haven seekers from overseas, and asset allocation
decision makers who view bond and money market returns as tepid at best.
FAVORABLE FISCAL AND MONETARY POLICY
- -------------------------------------------------------------------------------
Trends in Washington have never been better for the stock market. Tax rates have
been lowered for capital gains and we may see further reductions in estate and
inheritance taxes. Deregulation, with competitive free markets, continues to be
in vogue. Trade barriers and restrictions continue to be reduced. And finally,
no major income packages such as mandatory health care are coming forth. These
favorable trends, coupled with the potential for the first budget surplus since
1969, should be friendly for the markets in 1998.
[LINE GRAPH DEPICTING LEHMAN AGGREGATE BOND INDEX OMITTED]
Index Level
1/31/97 607.53
4/30/97 611.93
7/31/97 646.8
10/31/97 662.25
1/31/98 683.4
6
<PAGE>
THE ACHIEVEMENT FUNDS
LOW INFLATION AND INTEREST RATES
- -------------------------------------------------------------------------------
With inflation remaining under 2 percent and the 30-year Treasury average yield
pegged at 6% or lower, market price/earnings ratios should be able to hold
constant at above the 20 times level throughout the coming year. Future streams
of corporate earnings should become much more valuable in a present-value
analysis, providing a strong underpinning to individual stock values.
CORPORATE EARNINGS GROWTH
- -------------------------------------------------------------------------------
Market strategists' forecasts for earnings growth for 1998 range from a decline
of 10% to a modest increase of 4% to 5%. We feel that innovative measures from
corporate managements, coupled with enhanced worker productivity, cost cutting
measures, reduced debt costs, and further merger and downsizing activities
should provide a higher-than-expected 8% to 10% profit growth for the year.
This, however, would be the weakest profit growth rate since 1991.
MARKET FORECAST
- -------------------------------------------------------------------------------
Stocks aren't cheap, but that doesn't mean they won't go higher. Given the
favorable conditions I have outlined, the Dow has the potential of finishing
1998 at the 9000 level for a 14 percent price increase. Throughout the year it
is possible that the 9500 level will be tested on the upside and the 7000 level
on the downside. Expect volatility to become commonplace with 100 point swings
in the Dow becoming more the norm than the exception.
Risks to the forecast include the potential for conflict in Asia or the Middle
East, unexpected recessionary forces taking hold in the U.S., unexpected wage
rate acceleration in the U.S. driving inflation higher, a short-term violent
correction in the stock market damaging investors' optimism, or most
importantly, a slowdown or reduction in corporate earnings growth.
BOND MARKET OUTLOOK FOR 1998
- -------------------------------------------------------------------------------
With Treasury bond yield falling from 6.64% to 5.92% in 1997, a stellar year was
indeed enjoyed by bond investors. The Lehman Brothers aggregate bond index, a
benchmark used by most investment managers, scored an impressive 9.4% total
return, which includes interest income and price moves. Limited inflation, a
strong dollar, and favorable prospects for the balanced budget have set the
stage for a Treasury bond rate to remain in the 51/2 to 6 percent range. Bonds
should, therefore, provide positive returns of coupon income plus some slight
price appreciation throughout 1998.
SUMMARY
- -------------------------------------------------------------------------------
Following three years of far above-average stock market performance, we believe
investors should anticipate more moderate returns in 1998. We do foresee
opportunities for investors to generate returns exceeding 15% from a diversified
portfolio of stocks. However, we believe the risk of loss will increase for
individual stock selections where potential for earnings disappointments exist.
/S/ SIGNATURE
Sterling K. Jenson
PRESIDENT
First Security Investment Management, Inc.
7
<PAGE>
MANAGEMENT'S DISCUSSION & ANALYSIS
OF FUND PERFORMANCE
THE ACHIEVEMENT EQUITY FUND
- -------------------------------------------------------------------------------
The Achievement Equity Fund seeks long-term capital appreciation with current
income as a secondary consideration. The Fund should interest investors who seek
capital appreciation over the long-term to satisfy a future goal.
For the fiscal year ending January 31, 1998, the Fund's Institutional Class
provided a total return of 22.1%; since inception on December 28, 1994 total
cumulative return was 98.9%*. The S&P 500 Index returned 26.9% for the year
ending January 31, 1998. As an additional comparison, the Dow Jones Industrial
Average returned 18.2%.
The Fund invests in medium to large capitalization companies that are seasoned
in their businesses through many economic cycles. Selected stocks show good
growth in earnings yet are priced attractively in relation to those earnings.
The only derivative action allowed in the portfolio is covered-call writing as
described in the prospectus. The Fund may write covered-call options as a means
of increasing the yield of the portfolio and as a way to provide limited
protection against decreases in the market value of portfolio securities. No
other derivative products are utilized in managing the Fund.
The portfolio is diversified with the average weighting per stock at less than
2% of the total. Sector weightings are moderately over- or under-weighted to the
S&P 500 Index based on our economic and market outlook. Performance differences
between the Fund and the Index should, therefore, be determined by the sector
weighting differences and individual stock selections.
Presently, the Achievement Equity Fund is weighted by sector in line with the
weightings of the S&P 500 Index, with the exception of a modest under-weighting
in consumer staples and a modest overweighting in health care.
*The Retail Class of the Achievement Equity Fund produced a total return of
21.78%. Including the maximum sales charge of 4.50%, the total return of the
Fund's Retail Class was 16.31%.
8
<PAGE>
THE ACHIEVEMENT FUNDS
ACHIEVEMENT EQUITY FUND -- INSTITUTIONAL CLASS
[LINE GRAPH DEPICTING GROWTH OF $10,000 INVESTMENT OMITTED]
ACHIEVEMENT EQUITY FUND, STANDARD & POOR'S 500
INSTITUTIONAL CLASS COMPOSITE INDEX
12/31/94 $10,000 $10,000
1/31/95 10,291 10,259
1/31/96 13,641 14,221
1/31/97 16,369 17,965
1/31/98 19,993 22,800
AVERAGE ANNUAL TOTAL RETURN
ONE YEAR ANNUALIZED ANNUALIZED INCEPTION
RETURN THREE YEAR RETURN TO DATE
22.14% 24.78% 24.90%
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
ACHIEVEMENT EQUITY FUND -- RETAIL CLASS A
[LINE GRAPH DEPICTING GROWTH OF $10,000 INVESTMENT OMITTED]
ACHIEVEMENT EQUITY FUND, STANDARD & POOR'S 500
RETAIL CLASS A COMPOSITE INDEX
3/31/95 $ 9,550 $10,000
1/31/96 11,982 12,961
1/31/97 14,345 16,373
1/31/98 17,470 20,779
AVERAGE ANNUAL TOTAL RETURN
ONE YEAR RETURN ANNUALIZED INCEPTION TO DATE
21.78% 24.25%
16.31%* 22.28%*
*with load
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
9
<PAGE>
THE ACHIEVEMENT BALANCED FUND
- -------------------------------------------------------------------------------
The Achievement Balanced Fund seeks both income and capital appreciation
consistent with prudent investment risk. The Fund attempts to "walk the line"
between income and growth by taking advantage of the potential for growth
offered by stocks and income offered by bonds.
For the fiscal year ending January 31, 1998, the Institutional Class of the Fund
produced a total return of 17.28%*. Its benchmark, the weighted average of the
Lehman Intermediate Government/Corporate Bond Index and the S&P 500 Index had a
total return of 17.87%.
The difference in performance between the Fund and its benchmark can be
attributed to stock selection. The absence in the Fund of some of the larger and
more expensive stocks that make up the index impacted the Fund's performance as
those stocks again performed very well over the last year. The Fund invests in
medium to large capitalization companies that demonstrate good growth in
earnings yet are priced attractively in relation to those earnings. Some of the
best performing stocks in the market last year did not fit the Fund's investment
parameters.
The Fund maintained its bond allocation with a slightly longer maturity and
duration than the Lehman Index. With an average bond allocation of 35% the
longer maturity and duration helped increase the Fund's yield in an otherwise
flat year for bonds.
Looking forward, we expect both the bond and stock markets to have positive
returns this year. Inflation should remain under control and interest rates
should continue their downward trend under this scenario. We do expect the
growth rate of earnings to moderate this year, but with a decline in interest
rates the moderation in earnings should not be enough to put downward pressure
on the stock market. The Fund is positioned for a rising stock market with
almost 65% of its assets in equity. The equity portion of the Fund is highly
diversified with the average weighting in any individual stock between 1% and
2%. Sector weightings are also conservative with slight variations relative to
the S&P 500 Index. The bond portion of the Fund continues to maintain a maturity
and duration that is slightly longer than the Lehman Index. This is also a
result of our expectation for flat to declining interest rates. The Achievement
Balanced Fund will actively change both its asset class allocation and
individual security positions in response to any changes in the market or
economy.
*The Retail Class of the Achievement Balanced Fund produced a total return of
16.92% for the period. Including the maximum sales charge of 4.50%, the total
return of the Fund's Retail Class was 11.62%.
10
<PAGE>
THE ACHIEVEMENT FUNDS
ACHIEVEMENT BALANCED FUND -- INSTITUTIONAL CLASS
[LINE GRAPH DEPICTING GROWTH OF $10,000 INVESTMENT OMITTED]
ACHIEVEMENT BALANCED STANDARD & POOR'S LEHMAN INTERMEDIATE
FUND, INSTITUTIONAL 500 COMPOSITE GOVERNMENT/CORPORATE
CLASS INDEX BOND INDEX
12/31/94 $10,000 $10,000 $10,000
1/31/95 10,231 10,259 10,168
1/31/96 12,702 14,221 11,630
1/31/97 14,230 17,965 12,045
1/31/98 16,689 22,800 13,113
AVERAGE ANNUAL TOTAL RETURN
ONE YEAR ANNUALIZED ANNUALIZED INCEPTION
RETURN THREE YEAR RETURN TO DATE
17.28% 17.72% 17.89%
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
ACHIEVEMENT BALANCED FUND -- RETAIL CLASS A
[LINE GRAPH DEPICTING GROWTH OF $10,000 INVESTMENT OMITTED]
ACHIEVEMENT BALANCED STANDARD & POOR'S LEHMAN INTERMEDIATE
FUND, RETAIL 500 COMPOSITE GOVERNMENT/CORPORATE
CLASS A INDEX BOND INDEX
3/31/95 $ 9,550 $10,000 $10,000
1/31/96 11,377 12,961 11,142
1/31/97 12,720 16,373 11,540
1/31/98 14,872 20,779 12,562
AVERAGE ANNUAL TOTAL RETURN
ONE YEAR RETURN ANNUALIZED INCEPTION TO DATE
16.92% 17.23%
11.62%* 15.38%*
*with load
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
11
<PAGE>
THE ACHIEVEMENT INTERMEDIATE TERM BOND FUND
- -------------------------------------------------------------------------------
The Achievement Intermediate Term Bond Fund seeks to provide income consistent
with prudent investment risk and maintenance of appropriate liquidity. Fund
volatility is managed based upon economic, capital market, and interest
expectations. The Fund should be considered by investors desiring a relatively
stable income-producing investment with managed volatility and investment grade
securities.
The total return for the Institutional Class of the Fund for the fiscal year
ending January 31, 1998 was 8.82%*. The Fund performed in line with the Lehman
Intermediate Government/ Corporate Bond Index, which had a total return of 8.86%
for the same period. Treasury yields are likely to continue to be volatile in
the first half of the year, reacting to news on the Asian markets and domestic
economic strength. The 30-year Treasury is likely to trade in a range of 5.50%
to 6.25% through the first half of the year.
Individual bond purchases are based upon credit quality, liquidity, and
historical and relative yield comparisons. Additionally, bonds are analyzed for
their individual impact on the Fund as a whole in regards to average maturity,
duration, allocation, sector weighting and diversification.
Despite tight labor markets and good economic growth, interest rates fell in
1997 causing the domestic bond market to rally. Interest rates as measured by
U.S. Treasury bonds fell from 6.64% to 5.92% for the thirty year bond, from
6.42% to 5.71% for the ten year bond and from 5.87% to 5.64% for the two year
bond. The rally was based upon concern over the Asian economic crisis, flight to
quality, and evidence of continued price/inflation stability. Year-over-year
inflation for 1997 as measured by the Consumer Price Index (CPI) was up only
1.7%, the lowest increase since 1985 and the more stable core CPI was up only
2.2%, the smallest increases since 1965. Even though interest rates have dropped
considerably, the "real" rate of interest (the difference between the inflation
rate and current bond yields) is still historically quite high. The current
"real" rate of interest is around 4% compared to a long-term average of around
3%.
Duration and average maturity have been maintained somewhat longer than the
comparative Lehman Intermediate Government/Corporate Bond Index and "spread
product" has been overweighted on a relative basis. These positions were
positive total return influences in 1997. Based on our continued outlook for a
slower growth economy and the desire for attractive income levels these
positions are expected to be maintained.
*The Retail Class of the Achievement Intermediate Term Bond Fund produced a
total return of 8.60% for the period. Including the maximum sales charge of
3.50%, the total return of the Fund's Retail Class was 4.77%.
12
<PAGE>
THE ACHIEVEMENT FUNDS
ACHIEVEMENT INTERMEDIATE TERM BOND FUND -- INSTITUTIONAL CLASS
[LINE GRAPH DEPICTING GROWTH OF $10,000 INVESTMENT OMITTED]
ACHIEVEMENT INTERMEDIATE-TERM LEHMAN
BOND FUND, INTERMEDIATE
INSTITUTIONAL CLASS GOVERNMENT/CORPORATE BOND INDEX
12/31/94 $10,000 $10,000
1/31/95 10,147 10,168
1/31/96 11,529 11,630
1/31/97 11,767 12,045
1/31/98 12,804 13,113
AVERAGE ANNUAL TOTAL RETURN
ONE YEAR ANNUALIZED ANNUALIZED INCEPTION
RETURN THREE YEAR RETURN TO DATE
8.82% 8.06% 8.35%
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
ACHIEVEMENT INTERMEDIATE TERM BOND FUND -- RETAIL CLASS A
[LINE GRAPH DEPICTING GROWTH OF $10,000 INVESTMENT OMITTED]
ACHIEVEMENT INTERMEDIATE-TERM LEHMAN
BOND FUND, INTERMEDIATE
RETAIL CLASS A GOVERNMENT/CORPORATE BOND INDEX
3/31/95 $10,000 $10,000
1/31/96 10,693 11,142
1/31/97 10,886 11,540
1/31/98 11,822 12,562
AVERAGE ANNUAL TOTAL RETURN
ONE YEAR RETURN ANNUALIZED INCEPTION TO DATE
8.60% 7.68%
1.77%* 6.36%*
*with load
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
13
<PAGE>
THE ACHIEVEMENT SHORT TERM BOND FUND
- -------------------------------------------------------------------------------
The objective of The Achievement Short Term Bond Fund is to preserve principal
value and maintain a high degree of liquidity while providing current income.
The Fund should be considered by investors who seek a high quality, relatively
stable income-producing investment and are willing to accept a moderate degree
of risk.
The Fund seeks to achieve a total return over time greater than that of the
average money market fund. The Institutional Class of the Fund had a return of
6.25% for the fiscal year ending January 31, 1998*. Using the 3-month T-bill as
a proxy, the average money market fund produced a total return of 5.55% for the
same time period. As an additional comparison, the Salomon One-Year Treasury
benchmark returned 6.27%.
Individual bond purchases are based upon credit quality, liquidity, and
historical and relative yield comparisons. Additionally, bonds are analyzed for
their individual impact on the Fund as a whole in regards to average maturity,
duration, allocation, sector weighting and diversification.
Despite tight labor markets and good economic growth, interest rates fell in
1997 causing the domestic bond market to rally. Interest rates as measured by
U.S. Treasury bonds fell from 6.64% to 5.92% for the thirty year bond, from
6.42% to 5.71% for the ten year bond and from 5.87% to 5.64% for the two year
bond. The rally was based upon concern over the Asian economic crisis, flight to
quality, and evidence of continued price/inflation stability. Year-over-year
inflation for 1997 as measured by the Consumer Price Index (CPI) was up only
1.7%, the lowest increase since 1985 and the more stable core CPI was up only
2.2%, the smallest increases since 1965. Even though interest rates have dropped
considerably, the "real" rate of interest (the difference between the inflation
rate and current bond yields) is still historically quite high. The current
"real" rate of interest is around 4% compared to a long-term average of around
3%. Treasury yields are likely to continue to be volatile in the first half of
the year, reacting to news on the Asian markets and domestic economic strength.
The 30-year Treasury is likely to trade in a range of 5.50% to 6.25% through the
first half of the year.
Benefits of holding the Short Term Bond Fund remain the same. Because of the
short term nature of the portfolio volatility should generally be low while at
the same time income generated should be competitive with or superior to money
market yields.
*The Retail Class of the Achievement Short Term Bond Fund produced a total
return of 6.04% for the period. Including the maximum sales charge of 1.50%,
the total return of the Fund's Retail Class was 4.48%.
14
<PAGE>
THE ACHIEVEMENT FUNDS
ACHIEVEMENT SHORT TERM BOND FUND -- INSTITUTIONAL CLASS
[LINE GRAPH DEPICTING GROWTH OF $10,000 INVESTMENT OMITTED]
ACHIEVEMENT SHORT-TERM SALOMON 1-3 YEAR SALOMON 1-YEAR
BOND FUND, TREASURY/GOVERNMENT TREASURY BENCHMARK
INSTITUTIONAL CLASS /CORPORATE INDEX ON-THE-RUN
12/31/94 $10,000 $10,000 $10,000
1/31/95 10,062 10,138 10,101
1/31/96 10,847 11,182 10,879
1/31/97 11,324 11,718 11,478
1/31/98 12,032 12,559 12,198
AVERAGE ANNUAL TOTAL RETURN
ONE YEAR ANNUALIZED ANNUALIZED INCEPTION
RETURN THREE YEAR RETURN TO DATE
6.25% 6.14% 6.22%
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
ACHIEVEMENT SHORT TERM BOND FUND -- RETAIL CLASS A
[LINE GRAPH DEPICTING GROWTH OF $10,000 INVESTMENT OMITTED]
ACHIEVEMENT SHORT-TERM SALOMON 1-3 YEAR SALOMON 1-YEAR
BOND FUND, TREASURY/GOVERNMENT TREASURY BENCHMARK
RETAIL CLASS A /CORPORATE INDEX ON-THE-RUN
3/31/95 $ 9,850 $10,000 $10,000
1/31/96 10,460 10,821 10,613
1/31/97 10,883 11,340 11,198
1/31/98 11,540 12,154 11,900
AVERAGE ANNUAL TOTAL RETURN
ONE YEAR RETURN ANNUALIZED INCEPTION TO DATE
6.01% 5.82%
4.48%* 5.28%*
*with load
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
15
<PAGE>
THE ACHIEVEMENT SHORT TERM MUNICIPAL BOND FUND
- -------------------------------------------------------------------------------
The investment objective of the Achievement Short Term Municipal Bond Fund is to
provide as high a level of current income that is exempt from Federal income tax
as is consistent with preservation of capital. The Institutional Class of the
Fund returned 4.38% for the fiscal year ended January 31, 1998*. In comparison,
the Lehman Brothers 1-Year Municipal Bond Index returned 4.58% for the same
period.
The Fund holds only municipal bonds with maturities of 4 years or less. The
current average maturity is 2.6 years, slightly below the maximum allowed of 3
years. Holdings due in 1999 comprised 3.3% of the fund while 62.4% mature in
2000 and 33.8% in 2001. Over 90% of the securities are non-callable.
As of January 31, 1998 the current structure of the Fund by quality is as
follows: AAA 55.6%; AA 23.1%; A 8.4%; and BBB 5.3%. The Fund may own BBB-rated
issues up to 20% of the assets in the portfolio. Security holdings subject to
the Alternative Minimum Tax (AMT) are not permitted. The Fund is a national fund
and owns issues representing 22 states. Eight states represent more than 5% of
the total: Texas 9.5%; Indiana 9.3%; Alabama 7.5%; Illinois 7.2%; Ohio 7.0%;
Pennsylvania 6.6%; Minnesota 6.7%; and New York 6.5%.
Yields on 3-year A-rated general obligation municipal bonds declined over 40
basis points during the past year and nearly 70 basis points from the peak
reached in late April. This contributed to total return in excess of the coupon
earned for the year. The yield on the Fund also dropped over the year but
considerably less than the Index at just over 15 basis points. The yield spread
for 2-year high-grade municipals relative to U.S. treasuries ranged from just
under 62% to over 72% and ended near the highs at 71%. This tightening of
spreads can largely be attributed to a flight to quality as investors throughout
the world sought refuge from the Asian crisis by purchasing U.S. treasury
securities. Since U.S. investors purchase mostly municipals the drop in rates
was less severe. A related reason for the narrower spread is that U.S. treasury
securities have been rallying into dwindling supply as the Federal budget has
come into balance. In contrast, municipal bonds have rallied into increasing
supply. We look for spreads to return to normal as new municipal supply subsides
and as investors look beyond the current global difficulties.
Individual municipal bond purchases are based primarily on value and credit
quality. We continue to strive to achieve the Fund's investment goals of
providing shareholders with tax-exempt income and preservation of principal. The
Fund continues to be able to maintain its record of never having had a negative
quarter based on its total return.
*The Retail Class of the Achievement Short Term Municipal Bond Fund produced a
total return of 4.08% for the period. Including the maximum sales charge of
1.50%, the total return of the Fund's Retail Class was 2.55%.
16
<PAGE>
THE ACHIEVEMENT FUNDS
ACHIEVEMENT SHORT TERM MUNICIPAL BOND FUND -- INSTITUTIONAL CLASS
[LINE GRAPH DEPICTING GROWTH OF $10,000 INVESTMENT OMITTED]
ACHIEVEMENT SHORT-TERM LEHMAN BROTHERS
MUNICIPAL BOND FUND, 1-YEAR MUNICIPAL
INSTITUTIONAL CLASS BOND INDEX
12/31/94 $10,000 $10,000
1/31/95 10,040 10,051
1/31/96 10,714 10,709
1/31/97 11,038 11,175
1/31/98 11,522 11,687
AVERAGE ANNUAL TOTAL RETURN
ONE YEAR ANNUALIZED ANNUALIZED INCEPTION
RETURN THREE YEAR RETURN TO DATE
4.38% 4.69% 4.70%
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
ACHIEVEMENT SHORT TERM MUNICIPAL BOND FUND -- RETAIL CLASS A
[LINE GRAPH DEPICTING GROWTH OF $10,000 INVESTMENT OMITTED]
ACHIEVEMENT SHORT-TERM LEHMAN BROTHERS
MUNICIPAL BOND FUND, 1-YEAR MUNICIPAL
RETAIL CLASS A BOND INDEX
3/31/95 $ 9,850 $10,000
1/31/96 10,382 10,513
1/31/97 10,669 10,971
1/31/98 11,104 11,473
AVERAGE ANNUAL TOTAL RETURN
ONE YEAR RETURN ANNUALIZED INCEPTION TO DATE
4.08% 4.52%
2.55%* 3.98%*
*with load
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
17
<PAGE>
THE ACHIEVEMENT IDAHO MUNICIPAL BOND FUND
- -------------------------------------------------------------------------------
The Achievement Idaho Municipal Bond Fund continues to pursue an investment
objective to provide investors as high a level of current income exempt from
Federal and Idaho State income taxes as is consistent with the preservation of
capital. The Institutional Class of the Fund had a total return of 9.06% for the
fiscal year ended January 31, 1998*. In comparison the Lehman 5-Year and 10-Year
Municipal Bond Indexes produced total returns of 6.98% and 10.02% respectively
for the same period.
Interest rate trends were favorable to fixed income investors over the past
twelve months as price appreciation due to declining rates added to regular
coupon interest income to produce strong returns for investors. In general,
municipal market interest rates declined 0.50% to 0.70% as market participants
recognized neutral Federal Reserve monetary policy in a low inflation, moderate
growth economic environment.
Diversification and credit quality remain as key issues in the management of the
Fund. Approximately 100 individual issues from all geographic areas of the state
comprise the Fund. Bond maturities range from 4 years to 32 years with almost
75% of the Fund's maturities in the 10 to 20 year range. All of the securities
are rated A or better by a national rating agency with 2/3 of the holdings rated
AAA. The Fund has maintained a weighted average maturity near 15 years for most
of the past fiscal year to take advantage of declining interest rates and to
maintain an attractive tax-free yield.
We expect supply constraints to continue in the Idaho Municipal marketplace.
Stable interest rates should help the Fund maintain current income levels with
minimal volatility in the net asset value (NAV). We intend to maintain a fully
invested position with the Fund while identifying market opportunities to
increase yield consistent with the diversification and quality orientation of
the Fund.
*The Retail Class of the Achievement Idaho Municipal Bond Fund produced a total
return of 8.84% for the period. Including the maximum sales charge of 4.00%,
the total return of the Fund's Retail Class was 4.44%.
18
<PAGE>
THE ACHIEVEMENT FUNDS
ACHIEVEMENT IDAHO MUNICIPAL BOND FUND -- INSTITUTIONAL CLASS
[LINE GRAPH DEPICTING GROWTH OF $10,000 INVESTMENT OMITTED]
ACHIEVEMENT IDAHO LEHMAN 5-YEAR LEHMAN 10-YEAR
MUNICIPAL BOND FUND, MUNICIPAL BOND MUNICIPAL BOND
INSTITUTIONAL CLASS INDEX INDEX
12/31/94 $10,000 $10,000 $10,000
1/31/95 10,179 10,124 10,259
1/31/96 11,470 11,275 11,835
1/31/97 11,620 11,676 12,296
1/31/98 12,673 12,492 13,528
AVERAGE ANNUAL TOTAL RETURN
ONE YEAR ANNUALIZED ANNUALIZED INCEPTION
RETURN THREE YEAR RETURN TO DATE
9.06% 7.58% 7.94%
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE
ACHIEVEMENT IDAHO MUNICIPAL BOND FUND -- RETAIL CLASS A
[LINE GRAPH DEPICTING GROWTH OF $10,000 INVESTMENT OMITTED]
ACHIEVEMENT IDAHO LEHMAN 5-YEAR LEHMAN 10-YEAR
MUNICIPAL BOND FUND, MUNICIPAL BOND MUNICIPAL BOND
RETAIL CLASS A INDEX INDEX
3/31/95 $ 9,600 $10,000 $10,000
1/31/96 10,566 10,835 11,069
1/31/97 10,677 11,221 11,500
1/31/98 11,620 12,004 12,653
AVERAGE ANNUAL TOTAL RETURN
ONE YEAR RETURN ANNUALIZED INCEPTION TO DATE
8.84% 7.22%
4.44%* 5.71%*
*with load
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
19
<PAGE>
THE ACHIEVEMENT MUNICIPAL BOND FUND
- -------------------------------------------------------------------------------
The investment objective of the Achievement Municipal Bond Fund is to provide as
high a level of current income that is exempt from Federal income tax as is
consistent with preservation of capital.
The Fund commenced operation as a mutual fund on November 1, 1996, and recently
completed its first full year of operation. The Institutional Class of the Fund
produced a total return of 9.90% for the fiscal year ended January 31, 1998*.
The Fund performed in line with the benchmark Lehman Municipal Bond Index which
produced a return of 10.12% for the same period.
As of January 31, 1998, the current structure of the Fund by quality is as
follows: AAA 38.4%; AA 31.2%; A 11.7%; and BBB 15.4%. The Fund may own BBB-rated
issues up to 20% of the assets in the portfolio. Average option-adjusted
maturity for the Fund is 12.2 years with 31.2% of the maturities within 1 to 10
years, 66.0% within 10 to 20 years and 2.5% more than 20 years. The Fund may
hold up to 20% of the assets in issues subject to the Alternative Minimum Tax
(AMT). Current AMT holdings comprise 16.1% of the portfolio. The Fund is a
national fund and owns issues representing 41 states including the District of
Columbia and Puerto Rico. Only four states represent more than 5% of the total:
Pennsylvania 8.8%; Illinois 8.7%; Alaska 6.7% and New York 5.1%. Individual
municipal bond purchases are based primarily on value and credit quality. Value
may originate in the municipal market due to a variety of factors, some of which
include: the unique supply/demand characteristics of specific municipal
districts or sectors, buyer preferences for particular coupon structures,
underlying credit uncertainties, or investor unwillingness to analyze special
redemption language or prepayment probabilities. In addition, we may emphasize
different sectors or maturity structures of the municipal market depending on
their attractiveness relative to historical norms or current opportunities. We
believe the unique nature of the municipal market lends itself to analyzing
securities one at a time and adding only those securities that can add value to
the overall portfolio.
Yields on 10-year A-rated general obligation municipal bonds declined over 60
basis points during the past year. This contributed to strong total return
(income plus appreciation) for the Fund but makes it more difficult to maintain
high levels of income going forward. Nevertheless, we are pleased that the
current yield for the Fund ended the year within a few basis points of where it
began, while projected current income actually rose due to the higher share
price achieved throughout the period. The yield spread for 10-year high-grade
municipals relative to U.S. treasuries ranged from 72% to 79% and ended near the
highs at 78%. This tighten-
20
<PAGE>
THE ACHIEVEMENT FUNDS
ing of spreads can largely be attributed to a flight to quality as investors
throughout the world sought refuge from the Asian crisis by purchasing U.S.
treasury securities. Since U.S. investors purchase most municipals the drop in
rates in the municipal market was less severe. A related reason for the narrower
spread is that U.S. treasury securities have been rallying into dwindling supply
as the budget has come into balance. In contrast, municipal bonds have rallied
into increasing supply. We look for spreads to return to normal as new municipal
supply subsides and investors look beyond the current global difficulties.
We begin the New Year with a relatively flat yield curve. This should continue
until either inflation expectations rise and push up the long end of the curve
or economic growth wanes pushing down the short end. We continue to strive to
achieve the Fund's investment goals to provide shareholders with stable, high
levels of tax-exempt income. The size of the Fund enables us to capture
inefficiencies in the market that are unavailable to larger funds. As market
conditions change, we will adjust the Fund's investment strategy.
*The Retail Class of the Achievement Municipal Bond Fund produced a total return
of 9.78% for the period. Including the maximum sales charge of 4.00%, the total
return of the Fund's Retail Class was 5.36%.
21
<PAGE>
THE ACHIEVEMENT FUNDS
ACHIEVEMENT MUNICIPAL BOND FUND -- INSTITUTIONAL CLASS
[LINE GRAPH DEPICTING GROWTH OF $10,000 INVESTMENT OMITTED]
ACHIEVEMENT MUNICIPAL LEHMAN LIPPER GENERAL
BOND FUND, MUNICIPAL BOND MUNICIPAL DEBT
INSTITUTIONAL CLASS INDEX FUNDS AVERAGE
10/31/96 $10,000 $10,000 $10,000
1/31/97 10,135 10,159 10,131
1/31/98 11,138 11,188 11,157
AVERAGE ANNUAL TOTAL RETURN
ONE YEAR ANNUALIZED INCEPTION
RETURN TO DATE
9.90% 8.99%
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
ACHIEVEMENT MUNICIPAL BOND FUND -- RETAIL CLASS A
[LINE GRAPH DEPICTING GROWTH OF $10,000 INVESTMENT OMITTED]
ACHIEVEMENT MUNICIPAL LEHMAN LIPPER GENERAL
BOND FUND, MUNICIPAL BOND MUNICIPAL DEBT
RETAIL CLASS A INDEX FUNDS AVERAGE
11/31/96 $ 9,600 $10,000 $10,000
1/31/97 9,540 9,977 9,957
1/31/98 10,474 10,987 10,965
AVERAGE ANNUAL TOTAL RETURN
ONE YEAR RETURN ANNUALIZED INCEPTION TO DATE
9.78% 9.09%
5.36%* 5.54%*
*with load
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
22
<PAGE>
THE ACHIEVEMENT FUNDS TRUST
JANUARY 31, 1998
STATEMENT OF NET ASSETS
- -------------------------------------------------------------------------------
EQUITY FUND
- -------------------------------------------------------------------------------
[PIE CHART OMITTED]
RETAIL 2.9%
UTILITIES 7.6%
CONSUMER PRODUCTS 7.6%
OIL-ENERGY 9.4%
FINANCIAL 13.2%
OTHER 11.5%
DURABLE GOODS 34.1%
CHEMICALS AND DRUGS 13.7%
% OF TOTAL PORTFOLIO INVESTMENTS
- ---------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------
COMMON STOCKS -- 98.1%
AEROSPACE -- 2.5%
Boeing 50,000 $ 2,378
Lockheed Martin 27,000 2,810
--------
5,188
--------
AGRICULTURE -- 0.8%
Dole Food 33,000 1,534
--------
AUTOMOTIVE -- 1.9%
Borg-Warner Automotive 37,000 1,982
Ford Motor 38,000 1,938
--------
3,920
--------
BANKS -- 7.9%
Banc One 50,000 2,794
BankAmerica 27,000 1,919
Chase Manhattan Bank 17,000 1,822
NationsBank 45,000 2,700
Norwest 50,000 1,825
Summit Bancorp 55,000 2,750
U.S. Bancorp 22,000 2,409
--------
16,219
--------
BEAUTY PRODUCTS -- 2.3%
Gillette 23,000 2,271
Procter & Gamble 30,000 2,351
--------
4,622
--------
- ---------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------
CAPITAL GOODS -- 5.0%
Case 26,000 $ 1,516
General Electric 94,000 7,285
Harnischfeger Industries 40,000 1,400
--------
10,201
--------
CHEMICALS -- 2.3%
B.F. Goodrich 50,000 2,097
Monsanto 55,000 2,609
--------
4,706
--------
COMMUNICATIONS EQUIPMENT -- 3.9%
Allen Telecom* 98,229 1,842
Ascend Communications* 75,996 2,247
GTE 34,000 1,855
Pairgain Technologies* 110,328 2,027
--------
7,971
--------
COMPUTER SOFTWARE -- 1.9%
Microsoft* 15,500 2,312
Oracle Systems* 67,500 1,569
--------
3,881
--------
COMPUTERS & SERVICES -- 4.6%
Cisco Systems* 60,000 3,784
Hewlett Packard 33,000 1,980
International Business Machines 37,000 3,651
--------
9,415
--------
CONCRETE & MINERAL PRODUCTS -- 0.9%
Armstrong World Industries 25,000 1,781
--------
CONGLOMERATE -- 1.2%
Tyco International 54,000 2,396
--------
DRUGS -- 9.5%
Abbott Laboratories 24,600 1,742
Eli Lilly 33,000 2,227
Genzyme* 43,000 1,148
Merck 30,000 3,517
Mylan Laboratories 138,000 2,475
Pfizer 28,000 2,294
Schering Plough 35,000 2,533
SmithKline Beecham, ADR 57,000 3,595
--------
19,531
--------
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
23
<PAGE>
JANUARY 31, 1998
STATEMENT OF NET ASSETS
EQUITY FUND (CONCLUDED)
- ---------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------
ELECTRICAL UTILITIES -- 1.8%
FPL Group 27,000 $ 1,549
Texas Utilities 54,000 2,221
--------
3,770
--------
ENTERTAINMENT -- 1.3%
Walt Disney 25,000 2,664
--------
FINANCIAL SERVICES -- 3.5%
American Express 26,000 2,176
Federal National Mortgage
Association 53,000 3,273
Imperial Credit Industries* 92,724 1,698
--------
7,147
--------
FOOD, BEVERAGE & TOBACCO -- 3.2%
Coca Cola 40,000 2,590
ConAgra 61,000 1,929
PepsiCo 57,000 2,056
--------
6,575
--------
HOTELS & LODGING -- 1.9%
Hilton Hotels 71,000 2,010
ITT* 25,000 2,000
--------
4,010
--------
INSURANCE -- 2.0%
American International Group 21,600 2,383
General Re 8,200 1,707
--------
4,090
--------
MEDICAL PRODUCTS & SERVICES-- 4.5%
Boston Scientific* 41,000 2,081
Genesis Health Ventures* 120,000 3,270
Johnson & Johnson 27,000 1,807
Quorum Health Group* 82,500 2,062
--------
9,220
--------
METALS & MINING -- 2.1%
Aluminum Company of America 25,000 1,909
Titanium Metals* 90,000 2,391
--------
4,300
--------
OFFICE EQUIPMENT -- 0.6%
Corporate Express* 150,000 1,327
--------
PAPER & PAPER PRODUCTS -- 1.0%
Kimberly-Clark 40,000 2,088
--------
- --------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------
PETROLEUM PRODUCTS & SERVICES-- 10.2%
Amoco 31,000 $ 2,523
Coastal 60,000 3,480
Exxon 66,000 3,915
Mobil 50,000 3,406
Phillips Petroleum 22,368 984
Royal Dutch Petroleum 32,000 1,640
Schlumberger 44,000 3,242
Texaco 34,000 1,770
--------
20,960
--------
PRINTING & PUBLISHING -- 1.2%
McGraw-Hill 34,000 2,374
--------
RAILROADS -- 0.9%
Union Pacific 31,000 1,860
--------
REAL ESTATE INVESTMENT TRUSTS -- 2.3%
Innkeepers USA Trust 148,578 2,275
Security Capital
Industrial Trust 94,400 2,413
--------
4,688
--------
RETAIL -- 3.0%
Eagle Hardware & Garden* 100,000 1,863
Sears Roebuck 35,000 1,612
Wal-Mart Stores 70,000 2,791
--------
6,266
--------
SEMI-CONDUCTORS/INSTRUMENTS-- 4.0%
Analog Devices* 74,000 2,183
Intel 56,000 4,536
Micron Technology* 42,455 1,470
--------
8,189
--------
TELEPHONES & TELECOMMUNICATION-- 8.8%
AT&T 34,000 2,129
LCI International* 75,000 2,152
Lucent Technologies 20,000 1,770
MCI Communications 80,000 3,715
Motorola 70,000 4,161
SBC Communications 25,000 1,944
Worldcom* 60,000 2,149
--------
18,020
--------
TRUCKING -- 1.1%
US Freightways 67,000 2,345
--------
TOTAL COMMON STOCKS
(Cost $146,962) 201,258
--------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
24
<PAGE>
THE ACHIEVEMENT FUNDS TRUST
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
CASH EQUIVALENTS -- 1.9%
SEI Daily Income Trust Money
Market Portfolio $ 2,407 $ 2,407
SEI Daily Income Trust Prime
Obligation Portfolio 1,503 1,503
--------
TOTAL CASH EQUIVALENTS
(Cost $3,910) 3,910
--------
TOTAL INVESTMENTS -- 100.0%
(Cost $150,872) 205,168
--------
OTHER ASSETS AND LIABILITIES, NET-- 0.0% 88
--------
NET ASSETS:
Portfolio Shares of Institutional Class
(unlimited authorization -- no par value)
based on 12,742,551 outstanding shares
of beneficial interest 134,707
Portfolio Shares of Retail Class
(unlimited authorization -- no par value)
based on 635,829 outstanding shares
of beneficial interest 9,108
Overdistributed net investment income (12)
Accumulated net realized gain on investments 7,157
Net unrealized appreciation on investments 54,296
--------
TOTAL NET ASSETS-- 100.0% $205,256
========
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE-- INSTITUTIONAL CLASS $15.34
========
NET ASSET VALUE AND REDEMPTION
PRICE PER SHARE-- RETAIL CLASS $15.34
========
MAXIMUM OFFERING PRICE PER SHARE --
RETAIL CLASS ($15.34 / 95.5%) $16.06
========
- ---------------------------------------------------------
* NON-INCOME PRODUCING SECURITY
ADR -- AMERICAN DEPOSITORY RECEIPT
- ---------------------------------------------------------
BALANCED FUND
- ---------------------------------------------------------
[PIE CHART OMITTED]
OTHER 4.9%
CORPORATE SECURITIES 12.0%
TREASURY OBLIGATIONS 15.4%
MORTGAGE-BACKED SECURITIES 2.4%
COMMON STOCKS 65.3%
% OF TOTAL PORTFOLIO INVESTMENTS
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
U.S. TREASURY OBLIGATIONS -- 15.3%
U.S. Treasury Notes
8.125%, 02/15/98 $2,000 $ 2,002
7.000%, 04/15/99 2,500 2,547
8.000%, 08/15/99 2,000 2,076
7.750%, 11/30/99 2,500 2,603
7.750%, 02/15/01 2,500 2,665
7.875%, 08/15/01 2,500 2,694
7.500%, 05/15/02 2,500 2,696
5.875%, 09/30/02 2,000 2,036
6.250%, 02/15/03 2,500 2,589
7.250%, 05/15/04 2,500 2,735
7.875%, 11/15/04 2,500 2,832
--------
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $26,048) 27,475
--------
CORPORATE BONDS -- 11.9%
FINANCE -- 9.0%
Aetna Services
7.125%, 08/15/06 1,500 1,571
Associates of North America, MTN
8.420%, 01/05/00 2,000 2,097
Banc One
7.250%, 08/01/02 1,500 1,567
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
25
<PAGE>
JANUARY 31, 1998
STATEMENT OF NET ASSETS
BALANCED FUND (CONTINUED)
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
FINANCE (CONTINUED)
BankAmerica, MTN
7.125%, 05/12/05 $2,000 $ 2,102
Chase Manhattan
6.500%, 01/15/09 2,000 2,015
First Union
7.500%, 07/15/06 2,000 2,157
Ford Motor Credit
7.750%, 10/01/99 2,000 2,060
6.250%, 11/08/00 1,000 1,011
Safeco
6.875%, 07/15/07 1,500 1,558
--------
16,138
--------
INDUSTRIAL -- 2.9%
Lucent Technologies
7.250%, 07/15/06 2,000 2,152
Philip Morris
7.250%, 09/15/01 2,000 2,070
Seagram, YB
6.500%, 04/01/03 1,000 1,015
--------
5,237
--------
TOTAL CORPORATE BONDS
(Cost $20,469) 21,375
--------
ASSET-BACKED SECURITIES -- 0.7%
Olympic Automobile Receivables Trust,
Series 1995-E, Class A5
5.950%, 11/15/01 1,325 1,328
--------
TOTAL ASSET-BACKED SECURITIES
(Cost $1,333) 1,328
--------
MORTGAGE-BACKED SECURITIES -- 2.4%
American Southwest Financial Securities,
Series 1996-FHA1, Class A2
7.000%, 11/25/38 1,500 1,541
Citicorp Mortgage Securities,
Series 1997-2, Class A5 (A)
7.250%, 05/25/27 1,355 1,365
Donaldson Lufkin Jenrette
Mortgage Association,
Series 1997-CF1, Class A1B (B)
7.600%, 04/15/07 1,200 1,306
--------
TOTAL MORTGAGE-BACKED SECURITIES
(Cost $4,063) 4,212
--------
- ---------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------
COMMON STOCKS -- 65.0%
AEROSPACE -- 2.0%
Boeing 30,000 $ 1,427
Lockheed Martin 20,000 2,081
--------
3,508
--------
AGRICULTURE -- 0.5%
Dole Food 20,000 930
--------
AUTOMOTIVE -- 1.3%
Borg-Warner Automotive 21,500 1,152
Ford Motor 22,000 1,122
--------
2,274
--------
BANKS -- 5.3%
Banc One 36,059 2,015
BankAmerica 18,000 1,279
Chase Manhattan Bank 8,000 857
NationsBank 24,000 1,440
Norwest 30,000 1,095
Summit Bancorp 30,000 1,500
U.S. Bancorp 12,000 1,314
--------
9,500
--------
BEAUTY PRODUCTS -- 1.4%
Gillette 11,500 1,136
Procter & Gamble 18,000 1,411
--------
2,547
--------
CAPITAL GOODS -- 3.3%
Case 20,000 1,166
General Electric 50,000 3,875
Harnischfeger Industries 23,750 831
--------
5,872
--------
CHEMICALS -- 1.5%
B.F. Goodrich 21,100 885
Monsanto 37,500 1,779
--------
2,664
--------
COMMUNICATIONS EQUIPMENT -- 2.2%
Allen Telecom* 54,595 1,024
Ascend Communications* 33,248 983
GTE 19,000 1,037
Pairgain Technologies* 49,273 905
--------
3,949
--------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
26
<PAGE>
THE ACHIEVEMENT FUNDS TRUST
- ---------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------
COMPUTER SOFTWARE -- 1.3%
Microsoft* 9,000 $ 1,343
Oracle Systems* 39,000 907
--------
2,250
--------
COMPUTERS & SERVICES -- 3.3%
Cisco Systems* 41,837 2,638
Hewlett Packard 18,000 1,080
International Business Machines 21,400 2,112
--------
5,830
--------
CONCRETE & MINERAL PRODUCTS-- 0.6%
Armstrong World Industries 14,000 997
--------
CONGLOMERATE -- 0.8%
Tyco International 34,000 1,509
--------
DRUGS -- 6.5%
Abbott Laboratories 17,500 1,239
Eli Lilly 18,600 1,255
Genzyme* 28,000 747
Merck 18,000 2,111
Mylan Laboratories 70,000 1,256
Pfizer 15,000 1,229
Schering Plough 19,000 1,375
SmithKline Beecham, ADR 39,000 2,459
--------
11,671
--------
ELECTRICAL UTILITIES -- 1.5%
FPL Group 17,000 975
Texas Utilities 40,000 1,645
--------
2,620
--------
ENTERTAINMENT -- 0.8%
Walt Disney 13,000 1,385
--------
FINANCIAL SERVICES -- 1.9%
American Express 16,000 1,339
Federal National Mortgage
Association 20,500 1,266
Imperial Credit Industries* 46,276 847
--------
3,452
--------
FOOD, BEVERAGE & TOBACCO -- 2.3%
Coca Cola 30,000 1,943
ConAgra 34,000 1,075
PepsiCo 32,000 1,154
--------
4,172
--------
- ---------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------
HOTELS & LODGING -- 0.5%
ITT* 12,000 $ 960
--------
INSURANCE -- 1.3%
American International Group 12,000 1,324
General Re 5,000 1,041
--------
2,365
--------
MEDICAL PRODUCTS & SERVICES-- 2.8%
Boston Scientific* 22,000 1,117
Genesis Health Ventures* 64,000 1,744
Johnson & Johnson 15,000 1,004
Quorum Health Group* 45,000 1,125
--------
4,990
--------
METALS & MINING -- 1.3%
Aluminum Company of America 16,000 1,222
Titanium Metals* 43,000 1,142
--------
2,364
--------
OFFICE EQUIPMENT -- 0.4%
Corporate Express* 70,000 619
--------
PAPER & PAPER PRODUCTS -- 0.6%
Kimberly-Clark 22,000 1,148
--------
PETROLEUM PRODUCTS & SERVICES -- 6.8%
Amoco 20,000 1,628
Coastal 46,000 2,668
Exxon 39,000 2,313
Mobil 24,000 1,635
Phillips Petroleum 10,088 444
Royal Dutch Petroleum 20,000 1,025
Schlumberger 20,000 1,474
Texaco 18,000 937
--------
12,124
--------
PRINTING & PUBLISHING -- 1.2%
McGraw-Hill 30,000 2,094
--------
RAILROADS -- 0.6%
Union Pacific 17,500 1,050
--------
REAL ESTATE INVESTMENT TRUST -- 1.6%
Innkeepers USA Trust 89,142 1,365
Security Capital
Industrial Trust 55,927 1,430
--------
2,795
--------
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
27
<PAGE>
JANUARY 31, 1998
STATEMENT OF NET ASSETS
BALANCED FUND (CONCLUDED)
- ---------------------------------------------------------
FACE AMOUNT MARKET
DESCRIPTION (000)/SHARES VALUE (000)
- ---------------------------------------------------------
RETAIL -- 1.9%
Eagle Hardware & Garden* 56,000 $ 1,043
Sears Roebuck 20,000 921
Wal-Mart Stores 36,000 1,436
--------
3,400
--------
SEMI-CONDUCTORS/INSTRUMENTS -- 2.6%
Analog Devices* 42,333 1,249
Intel 32,000 2,592
Micron Technology* 23,545 815
--------
4,656
--------
TELEPHONES & TELECOMMUNICATION -- 6.3%
AT&T 19,000 1,190
Bellsouth 23,000 1,393
LCI International* 45,000 1,291
Lucent Technologies 11,000 974
MCI Communications 51,000 2,368
Motorola 40,000 2,378
SBC Communications 14,000 1,089
Worldcom* 15,000 537
--------
11,220
--------
TRUCKING -- 1.0%
US Freightways 50,000 1,750
--------
TOTAL COMMON STOCKS
(Cost $84,636) 116,665
--------
CASH EQUIVALENTS -- 4.2%
SEI Daily Income Trust
Money Market Portfolio $6,094 6,094
SEI Daily Income Trust Prime
Obligation Portfolio 1,498 1,498
--------
TOTAL CASH EQUIVALENTS
(Cost $7,592) 7,592
--------
TOTAL INVESTMENTS -- 99.5%
(Cost $144,141) 178,647
--------
OTHER ASSETS AND LIABILITIES, NET-- 0.5% 973
--------
- ---------------------------------------------------------
MARKET
DESCRIPTION VALUE (000)
- ---------------------------------------------------------
NET ASSETS:
Portfolio Shares of Institutional Class
(unlimited authorization -- no par value)
based on 13,415,427 outstanding shares
of beneficial interest $137,620
Portfolio Shares of Retail Class
(unlimited authorization -- no par value)
based on 295,707 outstanding shares
of beneficial interest 3,515
Undistributed net investment income 299
Accumulated net realized gain on investments 3,680
Net unrealized appreciation on investments 34,506
--------
TOTAL NET ASSETS-- 100.0% $179,620
========
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE-- INSTITUTIONAL CLASS $13.10
========
NET ASSET VALUE AND REDEMPTION
PRICE PER SHARE-- RETAIL CLASS $13.08
========
MAXIMUM OFFERING PRICE PER SHARE --
RETAIL CLASS ($13.08 / 95.5%) $13.70
========
- -------------------------------------------------------
* NON-INCOME PRODUCING SECURITY
ADR -- AMERICAN DEPOSITORY RECEIPT
MTN -- MEDIUM TERM NOTE
YB -- YANKEE BOND
(A) FLOATING RATE SECURITY -- THE RATE REPORTED ON THE STATEMENT OF NET ASSETS
IS THE RATE IN EFFECT ON JANUARY 31, 1998.
(B) PRIVATE PLACEMENT
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
28
<PAGE>
THE ACHIEVEMENT FUNDS TRUST
- ---------------------------------------------------------
INTERMEDIATE TERM BOND FUND
- ---------------------------------------------------------
[PIE CHART OMITTED]
ASSET BACKED SECURITIES 3.8%
CASH EQUIVALENTS 3.1%
MORTGAGE-BACKED SECURITIES 8.0%
CORPORATE SECURITIES 35.1%
U.S. GOVERNMENT SECURITIES 50.0%
% OF TOTAL PORTFOLIO INVESTMENTS
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
U.S. TREASURY OBLIGATIONS -- 43.0%
U.S. Treasury Bonds
7.625%, 02/15/07 $1,000 $ 1,071
7.125%, 02/15/23 2,000 2,317
6.250%, 08/15/23 2,000 2,093
U.S. Treasury Notes
6.500%, 04/30/99 2,000 2,027
6.750%, 05/31/99 4,000 4,070
6.750%, 06/30/99 5,000 5,094
6.875%, 07/31/99 4,000 4,086
7.125%, 09/30/99 4,000 4,110
7.750%, 01/31/00 1,500 1,567
7.125%, 02/29/00 4,000 4,137
6.750%, 04/30/00 3,000 3,086
6.250%, 08/31/00 4,000 4,083
7.750%, 02/15/01 2,500 2,665
6.375%, 03/31/01 2,000 2,056
7.875%, 08/15/01 1,500 1,617
7.500%, 11/15/01 1,000 1,070
6.250%, 02/15/03 5,000 5,178
7.250%, 08/15/04 5,000 5,480
7.500%, 02/15/05 1,000 1,113
6.500%, 08/15/05 1,000 1,058
6.875%, 05/15/06 1,000 1,086
7.000%, 07/15/06 2,000 2,189
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
U.S. TREASURY OBLIGATIONS (CONTINUED)
6.500%, 10/15/06 $6,000 $ 6,376
6.125%, 08/15/07 3,000 3,131
--------
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $68,759) 70,760
--------
U.S. GOVERNMENT AGENCY OBLIGATIONS -- 6.3%
Federal Home Loan Bank
7.190%, 04/27/01 1,000 1,047
7.280%, 07/25/01 1,000 1,052
7.390%, 08/22/01 1,000 1,057
Federal Home Loan Mortgage
Corporation
6.795%, 12/01/03 1,000 1,053
Federal National Mortgage
Association
7.050%, 12/10/98 1,000 1,011
6.850%, 04/05/04 1,000 1,055
Federal National Mortgage
Association, MTN
6.625%, 04/18/01 1,000 1,030
7.520%, 08/24/05 1,000 1,006
7.500%, 10/26/06 2,000 2,015
--------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS
(Cost $10,243) 10,326
--------
CORPORATE BONDS -- 34.6%
FINANCE -- 16.2%
Aetna Services
6.750%, 08/15/01 2,000 2,060
American General Finance
7.250%, 04/15/00 1,000 1,029
Associates of North America, MTN
6.810%, 08/03/01 1,000 1,030
7.540%, 04/14/04 1,000 1,074
BankAmerica
7.125%, 05/01/06 2,000 2,110
Chase Manhattan
8.125%, 06/15/02 1,000 1,079
Citicorp
7.125%, 06/01/03 1,000 1,045
Commercial Credit
6.875%, 05/01/02 1,000 1,036
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
29
<PAGE>
JANUARY 31, 1998
STATEMENT OF NET ASSETS
INTERMEDIATE TERM BOND FUND (CONCLUDED)
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000 VALUE (000)
- ---------------------------------------------------------
FINANCE (CONTINUED)
First Union
7.050%, 08/01/05 $1,000 $ 1,050
Ford Motor Credit
8.000%, 06/15/02 1,000 1,075
7.750%, 03/15/05 1,000 1,086
General Electric Capital, MTN
6.840%, 04/26/98 1,000 1,003
General Motors Acceptance, MTN
7.250%, 05/15/03 1,000 1,052
Grand Metro
7.125%, 09/15/04 1,000 1,052
Household Finance
7.650%, 05/15/07 1,000 1,090
J.P. Morgan
7.250%, 01/15/02 1,000 1,044
Kerr-McGee
6.625%, 10/15/07 500 521
Lehman Brothers Holdings, MTN
7.110%, 09/27/99 1,000 1,018
NationsBank
7.625%, 04/15/05 1,000 1,081
Salomon, MTN
7.000%, 05/15/99 1,000 1,014
Sears Roebuck Acceptance
6.950%, 05/15/02 1,000 1,035
Sears Roebuck Acceptance, MTN
6.580%, 11/20/03 1,000 1,020
Society National Bank
7.250%, 06/01/05 1,000 1,061
US West Capital Funding, MTN
6.850%, 01/15/02 1,000 1,027
--------
26,692
--------
INDUSTRIAL -- 16.5%
American Home Products
7.700%, 02/15/00 1,000 1,036
AT&T
6.750%, 04/01/04 1,000 1,041
AT&T, MTN
7.140%, 07/02/99 1,000 1,018
CSR America
6.875%, 07/21/05 2,000 2,082
CSX Transportation
7.540%, 03/15/03 1,000 1,066
Dayton Hudson
7.500%, 07/15/06 2,000 2,152
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
Dow Capital, YB
7.125%, 01/15/03 $1,000 $ 1,045
Hertz
7.000%, 07/01/04 2,000 2,078
International Lease
7.000%, 06/01/98 1,000 1,005
J.C. Penney, MTN
7.050%, 05/23/05 1,000 1,044
John Deere Capital
7.140%, 09/15/98 1,000 1,009
MCI Communications
7.125%, 01/20/00 1,000 1,023
Nabisco
6.700%, 06/15/02 1,000 1,024
Norfolk Southern
6.950%, 05/01/02 1,000 1,039
Pacific Bell
7.000%, 07/15/04 1,000 1,046
Ryder Systems
7.340%, 11/01/00 1,040 1,080
Sara Lee, MTN
7.400%, 03/22/02 1,000 1,050
Southwestern Bell Telephone, MTN
6.250%, 03/12/01 1,150 1,164
Texas Instruments, MTN
6.875%, 07/15/00 1,000 1,028
Wal-Mart Stores
6.500%, 06/01/03 1,000 1,029
Walt Disney
6.750%, 03/30/06 2,000 2,090
Waste Management
7.700%, 10/01/02 1,000 1,064
--------
27,213
--------
UTILITIES -- 1.9%
Philadelphia Electric
6.625%, 03/01/03 1,000 1,029
Telstra
6.500%, 07/31/03 1,000 1,021
Union Electric
6.750%, 10/15/99 1,000 1,016
--------
3,066
--------
TOTAL CORPORATE BONDS
(Cost $55,642) 56,971
--------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
30
<PAGE>
THE ACHIEVEMENT FUNDS TRUST
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
ASSET-BACKED SECURITIES -- 3.7%
Champion Home Equity Trust,
Series 1997-Z, Class A3
6.770%, 03/25/15 $2,000 $ 2,034
Olympic Automobile Receivables
Trust, Series 1995-E, Class A5
5.950%, 11/15/01 2,000 2,004
Olympic Automobile Receivables
Trust, Series 1996-B, Class A5
6.900%, 02/15/04 2,000 2,063
--------
TOTAL ASSET-BACKED SECURITIES
(Cost $6,011) 6,101
--------
MORTGAGE-BACKED SECURITIES -- 8.0%
American Southwest Financial Securities,
Series 1996-FHA1, Class A2
7.000%, 11/25/38 3,000 3,082
Citicorp Mortgage Securities,
Series 1997-2, Class A5 (A)
7.250%, 05/25/27 2,710 2,730
Donaldson Lufkin Jenrette
Mortgage Association,
Series 1996-CF2, Class A1B (B)
7.290%, 11/12/21 3,000 3,199
Donaldson Lufkin Jenrette
Mortgage Association,
Series 1997-CF1, Class A1B (B)
7.600%, 04/15/07 2,000 2,177
Nomura Asset Securities,
Series 1994-MD1, Class A1B (A)
7.524%, 03/15/18 1,827 1,893
--------
TOTAL MORTGAGE-BACKED SECURITIES
(Cost $12,680) 13,081
--------
CASH EQUIVALENTS -- 3.0%
SEI Daily Income Trust
Money Market Portfolio 4,882 4,882
SEI Daily Income Trust Prime
Obligation Portfolio 92 92
--------
TOTAL CASH EQUIVALENTS
(Cost $4,974) 4,974
--------
- ---------------------------------------------------------
MARKET
DESCRIPTION VALUE (000)
- ---------------------------------------------------------
TOTAL INVESTMENTS -- 98.6%
(Cost $158,309) $162,213
--------
OTHER ASSETS AND LIABILITIES, NET-- 1.4% 2,305
--------
NET ASSETS:
Portfolio Shares of Institutional Class
(unlimited authorization -- no par value)
based on 15,221,834 outstanding shares of
beneficial interest 160,457
Portfolio Shares of Retail Class
(unlimited authorization -- no par value)
based on 260,504 outstanding shares
of beneficial interest 2,714
Overdistributed net investment income (1)
Accumulated net realized loss on investments (2,556)
Net unrealized appreciation on investments 3,904
--------
TOTAL NET ASSETS-- 100.0% $164,518
========
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE-- INSTITUTIONAL CLASS $10.63
========
NET ASSET VALUE AND REDEMPTION
PRICE PER SHARE-- RETAIL CLASS $10.66
========
MAXIMUM OFFERING PRICE PER SHARE --
RETAIL CLASS ($10.66 / 96.5%) $11.05
========
- ---------------------------------------------------------
MTN -- MEDIUM TERM NOTE
YB -- YANKEE BOND
(A) FLOATING RATE SECURITY -- THE RATE REPORTED ON THE STATEMENT OF NET ASSETS
IS THE RATE IN EFFECT ON JANUARY 31, 1998.
(B) PRIVATE PLACEMENT
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
31
<PAGE>
JANUARY 31, 1998
STATEMENT OF NET ASSETS
- ---------------------------------------------------------
SHORT TERM BOND FUND
- ---------------------------------------------------------
[PIE CHART OMITTED]
CASH EQUIVALENTS 0.6%
MORTGAGE-BACKED SECURITIES 4.6%
U.S. GOVERNMENT SECURITIES 32.4%
CORPORATE SECURITIES 62.4%
% OF TOTAL PORTFOLIO INVESTMENTS
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
U.S. TREASURY OBLIGATIONS -- 18.0%
U.S. Treasury Notes
6.750%, 05/31/99 $2,000 $ 2,035
6.875%, 07/31/99 2,000 2,043
6.875%, 08/31/99 2,000 2,045
6.125%, 07/31/00 1,000 1,017
6.250%, 08/31/00 2,000 2,042
--------
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $9,115) 9,182
--------
U.S. GOVERNMENT AGENCY OBLIGATIONS -- 13.8%
Federal Home Loan Bank
6.500%, 03/24/00 2,000 2,001
5.950%, 01/29/01 1,000 1,000
Federal National Mortgage
Association, MTN
6.120%, 08/25/00 2,000 2,017
6.310%, 09/14/00 2,000 2,035
--------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS
(Cost $7,000) 7,053
--------
CORPORATE BONDS -- 61.2%
FINANCE -- 29.5%
Associates of North America
6.250%, 03/15/99 1,000 1,006
6.375%, 08/15/99 1,000 1,008
Bankers Trust New York
6.625%, 07/30/99 1,000 1,011
Barnett Bank, MTN
6.250%, 07/28/98 1,000 1,003
CIT Group Holdings, MTN
6.625%, 09/13/99 1,400 1,417
Comerica Bank
6.750%, 05/12/98 1,500 1,504
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
Ford Motor Credit
5.625%, 01/15/99 $1,000 $ 1,000
Ford Motor Credit, MTN
6.950%, 05/15/00 1,000 1,027
General Motors Acceptance, MTN
6.700%, 07/02/99 1,000 1,011
7.125%, 05/10/00 1,000 1,029
Goldman Sachs
6.200%, 12/15/00 1,000 1,006
Household Bank FSB
6.250%, 04/01/99 1,000 1,006
Morgan Stanley Group, MTN
6.375%, 01/18/00 1,000 1,013
Travelers Property & Casualty
6.750%, 09/01/99 1,000 1,015
--------
15,056
--------
INDUSTRIAL -- 21.8%
Albertson's
6.375%, 06/01/00 1,000 1,015
Coca Cola Enterprises
7.000%, 11/15/99 1,000 1,023
CSC Enterprises
6.800%, 04/15/99 1,000 1,013
CSX Transport
5.740%, 03/15/99 1,000 1,000
Ingersoll Rand, MTN
6.450%, 08/28/98 1,000 1,003
6.510%, 08/09/99 1,000 1,013
International Business Machines
6.375%, 06/15/00 1,000 1,016
J.C. Penny, MTN
6.375%, 09/15/00 1,000 1,016
John Deere Capital, MTN
6.150%, 08/01/00 1,000 1,010
Sears Roebuck Acceptance, MTN
6.400%, 09/25/00 1,000 1,013
Southwestern Bell Capital, MTN
7.000%, 11/22/99 1,000 1,020
--------
11,142
--------
UTILITIES -- 9.9%
Detroit Edision, MTN
6.390%, 03/15/00 1,000 1,012
Georgia Power
6.125%, 09/01/99 2,000 2,010
Midwest Power
6.750%, 02/01/00 1,000 1,021
Portland General Electric, MTN
5.650%, 05/15/98 1,000 1,000
--------
5,043
--------
TOTAL CORPORATE BONDS
(Cost $31,147) $ 31,241
--------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
32
<PAGE>
THE ACHIEVEMENT FUNDS TRUST
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
ASSET-BACKED SECURITIES -- 4.5%
Key Auto Finance Trust,
Series 1997-2, Class A1
5.835%, 01/05/99 $ 938 $ 938
WFS Financial Owner Trust,
Series 1997-A, Class A2
6.150%, 12/20/99 1,383 1,386
--------
TOTAL ASSET-BACKED SECURITIES
(Cost $2,324) 2,324
--------
CASH EQUIVALENTS -- 0.6%
SEI Daily Income Trust
Money Market Portfolio 287 287
SEI Daily Income Trust Prime
Obligation Portfolio 19 19
--------
TOTAL CASH EQUIVALENTS
(Cost $306) 306
--------
TOTAL INVESTMENTS -- 98.1%
(Cost $49,892) 50,106
--------
OTHER ASSETS AND LIABILITIES, NET-- 1.9% 951
--------
NET ASSETS:
Portfolio Shares of Institutional Class
(unlimited authorization -- no par value)
based on 5,061,072 outstanding shares
of beneficial interest 52,965
Portfolio Shares of Retail Class
(unlimited authorization -- no par value)
based on 20,300 outstanding shares
of beneficial interest 206
Accumulated net realized loss on investments (2,328)
Net unrealized appreciation on investments 214
--------
TOTAL NET ASSETS-- 100.0% $ 51,057
========
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- INSTITUTIONAL CLASS $10.05
========
NET ASSET VALUE AND REDEMPTION
PRICE PER SHARE-- RETAIL CLASS $10.04
========
MAXIMUM OFFERING PRICE PER SHARE --
RETAIL CLASS ($10.04 / 98.5%) $10.19
========
- ---------------------------------------------------------
MTN -- MEDIUM TERM NOTE
- ---------------------------------------------------------
SHORT TERM MUNICIPAL
BOND FUND
- ---------------------------------------------------------
[PIE CHART OMITTED]
REVENUE BONDS 55.8%
GENERAL OBLIGATIONS 43.1%
CASH EQUIVALENTS 1.1%
% OF TOTAL PORTFOLIO INVESTMENTS
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
MUNICIPAL BONDS -- 97.8%
ALABAMA -- 7.5%
Alabama State Water Pollution
Control Authority RB, AMBAC
5.250%, 08/15/00 $500 $ 516
Jasper, Waterworks & Sewer
Board RB, AMBAC
5.050%, 06/01/01 50 52
Mobile County GO
6.050%, 02/01/01 65 69
Mobile County, Public Improvements
GO, AMBAC
7.125%, 08/15/10 500 547
--------
1,184
--------
ARIZONA -- 1.8%
Arizona State Educational
Marketing Loan Review
RB, Series A, MBIA
6.900%, 09/01/00 265 281
--------
CALIFORNIA -- 3.2%
Oxnard, Special Assessment RB
4.900%, 09/02/00 500 506
--------
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
33
<PAGE>
JANUARY 31, 1998
STATEMENT OF NET ASSETS
SHORT TERM MUNICIPAL BOND FUND (CONTINUED)
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
CONNECTICUT -- 3.6%
Connecticut State Development
Authority RB, Gross
Health Care Project
8.500%, 04/01/21 $500 $ 575
--------
HAWAII -- 3.3%
Hawaii State GO, Series C, FGIC
6.000%, 03/01/01 500 528
--------
ILLINOIS -- 7.2%
Du Page, Water Commission GO
5.850%, 03/01/00 500 519
Illinois State Health Facilities
Authority RB, Loyola University
Health Systems, Series A, MBIA
4.550%, 07/01/01 300 304
Illinois State Tax Increment RB,
Hoffman Estates
6.500%, 05/15/01 300 320
--------
1,143
--------
INDIANA -- 9.3%
Indiana State Educational Facility
Authority RB, University of
Evansville Project
8.125%, 11/01/10 300 338
Indiana State School Building
Corporation RB, Kokomo Center,
AMBAC, STAID
6.750%, 07/15/00 500 532
Indiana University RB, Series H
6.600%, 08/01/01 550 600
--------
1,470
--------
IOWA -- 3.2%
Sioux City, Public Improvements GO
4.800%, 06/01/00 500 511
--------
MARYLAND -- 3.2%
Prince George County, Public
Improvements GO, Series A, MBIA
5.100%, 03/01/00 500 513
--------
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
MINNESOTA -- 6.7%
Owatonna, Independent School
District # 761 GO
5.100%, 02/01/00 $500 $ 513
Rochester, Health Care Facilities RB,
Mayo Medical Center, Series C
7.100%, 11/15/00 500 541
--------
1,054
--------
MISSISSIPPI -- 2.3%
Mississippi State Higher Education
RB, Series B
6.100%, 07/01/01 350 365
--------
NEBRASKA -- 0.7%
Nebraska State Building Lease RB,
Data Processing Center
5.800%, 06/15/01 100 105
--------
NEVADA -- 4.1%
Nevada State Housing Division RB,
Single Family Program, Series A-1
5.200%, 10/01/01 95 97
Washoe County, Public Improvements
GO, MBIA
8.250%, 06/01/00 500 547
--------
644
--------
NEW YORK -- 6.5%
New York State Thruway Authority RB,
Local Highway & Bridges
Services Contract
5.000%, 04/01/01 500 511
North Hempstead GO, Series A, FGIC
5.500%, 02/15/01 500 524
--------
1,035
--------
NORTH DAKOTA -- 3.2%
Fargo RB, AMBAC
5.000%, 01/01/01 500 513
--------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
34
<PAGE>
THE ACHIEVEMENT FUNDS TRUST
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
OHIO -- 7.0%
Cincinnati, City School District Tax
Anticipation Note, Series C, AMBAC
5.250%, 12/01/00 $500 $ 518
Montgomery County GO,
Issue I, Series A
6.750%, 09/01/10 100 109
Ohio State School District GO
5.250%, 04/15/01 455 474
--------
1,101
--------
PENNSYLVANIA -- 6.6%
Allegheny County, Hospital
Development Authority RB,
Saint Francis Medical Center Project
4.800%, 05/15/00 395 400
Pennsylvania State GO
9.000%, 10/01/00 190 192
9.000%, 10/01/01 90 92
Philadelphia, Hospitals & Higher
Education Facilities Authority RB,
Temple University Hospital, Series A
6.000%, 11/15/00 350 366
--------
1,050
--------
SOUTH CAROLINA -- 3.3%
Pickens County, School District
GO, FGIC
5.250%, 05/01/00 500 515
--------
TEXAS -- 9.5%
Amarillo, Independent School District
GO, PSFG
7.000%, 02/01/00 500 529
Dallas, Housing RB, Corporate
Capital Projects
7.450%, 08/01/00 140 148
Northeast Texas Independent School
District GO, PSFG
7.000%, 02/01/00 500 529
Tarrant County, Health Facilities
Development RB, Health Resources
Systems, Series A, MBIA
5.000%, 02/15/01 300 308
--------
1,514
--------
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
UTAH -- 3.2%
Utah State Water Finance Agency RB,
Series A, MBIA
5.000%, 10/01/00 $500 $ 513
--------
WASHINGTON -- 1.6%
Washington State Public Power
Supply RB, Nuclear
Project # 1, Series B
5.000%, 07/01/01 250 256
--------
WISCONSIN -- 0.8%
Wisconsin State Housing & Economic
Development Authority RB, Series C
4.800%, 11/01/00 125 127
--------
TOTAL MUNICIPAL BONDS
(Cost $15,353) 15,503
--------
CASH EQUIVALENTS -- 1.1%
SEI Institutional
Tax-Free Portfolio 55 55
SEI Tax-Free Portfolio 115 115
--------
TOTAL CASH EQUIVALENTS
(Cost $170) 170
--------
TOTAL INVESTMENTS -- 98.9%
(Cost $15,523) 15,673
--------
OTHER ASSETS AND LIABILITIES, NET-- 1.1% 176
--------
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
35
<PAGE>
JANUARY 31, 1998
STATEMENT OF NET ASSETS
SHORT TERM MUNICIPAL BOND FUND (CONCLUDED)
- ----------------------------------------------------------
MARKET
DESCRIPTION VALUE (000)
- ---------------------------------------------------------
NET ASSETS:
Portfolio Shares of Institutional Class
(unlimited authorization -- no par
value) based on 1,554,562
outstanding shares of
beneficial interest $ 15,455
Portfolio Shares of Retail Class
(unlimited authorization -- no par
value) based on 22,103 outstanding
shares of beneficial interest 227
Undistributed net investment income 8
Accumulated net realized gain on investments 9
Net unrealized appreciation on investments 150
--------
TOTAL NET ASSETS-- 100.0% $15,849
========
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- INSTITUTIONAL CLASS $10.05
========
NET ASSET VALUE AND REDEMPTION
PRICE PER SHARE-- RETAIL CLASS $10.08
========
MAXIMUM OFFERING PRICE PER SHARE --
RETAIL CLASS ($10.08 / 98.5%) $10.23
========
- ---------------------------------------------------------
GO -- GENERAL OBLIGATION
RB -- REVENUE BOND
THE FOLLOWING ORGANIZATIONS HAVE PROVIDED UNDERLYING CREDIT SUPPORT FOR
SECURITIES LISTED ABOVE.
AMBAC -- AMERICAN MUNICIPAL BOND ASSURANCE CORPORATION
FGIC -- FINANCIAL GUARANTY INSURANCE CORPORATION
MBIA -- MUNICIPAL BOND INSURANCE ASSOCIATION
PSFG -- PERMANENT SCHOOL FUND GUARANTEED
STAID -- STATE AID WITHHOLDING
- ---------------------------------------------------------
IDAHO MUNICIPAL BOND FUND
- ---------------------------------------------------------
[PIE CHART OMITTED]
CASH EQUIVALENTS 1.9%
REVENUE BONDS 25.7%
GENERAL OBLIGATIONS 72.4%
% OF TOTAL PORTFOLIO INVESTMENTS
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
MUNICIPAL BONDS -- 96.8%
IDAHO -- 93.1%
Ada & Canyon Counties,
Joint School District # 2,
Meridian GO
5.350%, 07/30/09 $ 750 $ 802
5.500%, 07/30/10 205 220
5.500%, 07/30/11 270 289
5.500%, 07/30/14 500 529
5.625%, 07/30/16 500 531
Ammon, Urban Renewal Agency
RB, Series B
6.000%, 08/01/14 125 132
Bannock & Caribou Counties,
Joint School District # 21,
Marsh VY GO
5.300%, 09/01/04 100 104
Bannock County GO, FGIC
5.250%, 08/01/15 500 513
Bingham County, School
District # 055, Blackfoot
GO, MBIA
5.650%, 08/01/15 560 591
Boise City RB
5.100%, 02/01/11 500 517
Boise City, Airport RB, Package
Facility Project, Series A, AMBAC
5.400%, 08/01/11 1,000 1,052
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
36
<PAGE>
THE ACHIEVEMENT FUNDS TRUST
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
Boise City, Independent School
District # 1 GO, AMBAC
5.400%, 07/30/14 $ 500 $ 521
Boise, Independent School
District GO
5.375%, 07/30/10 250 265
5.500%, 07/30/16 1,250 1,306
Boise State University Student
Housing System RB
5.250%, 04/01/17 160 164
Bonneville & Bingham Counties,
School District # 93 GO, FGIC
5.750%, 07/30/07 500 552
5.500%, 07/30/10 850 914
Bonneville County, Jail Bonds
GO, FSA
5.500%, 08/01/16 590 616
Bonneville County, School
District # 91, Idaho Falls GO
5.200%, 08/01/05 500 517
5.450%, 08/01/08 500 517
5.500%, 08/01/09 300 310
Canyon County, School
District # 131, Nampa GO, MBIA
5.500%, 07/30/11 500 521
5.500%, 07/30/12 500 521
Canyon County, School
District # 132 GO, FSA
5.400%, 07/30/12 400 419
5.450%, 07/30/15 900 940
Canyon County, School
District # 132 GO, FSA
5.400%, 07/30/11 200 209
5.450%, 07/30/14 470 492
Canyon County, School
District # 139 GO
5.100%, 08/01/09 500 513
5.200%, 08/01/10 1,000 1,026
5.200%, 08/01/11 320 328
5.200%, 08/01/12 110 112
Caribou & Bonneville Counties,
School District # 150 GO
5.500%, 09/01/06 200 206
Cassia & Twin Falls Counties,
Joint School District # 151
GO, FGIC
5.375%, 08/01/14 1,000 1,041
5.375%, 08/01/16 1,000 1,037
City of Sun Valley GO
5.050%, 08/01/08 195 203
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
Coeur D'Alene GO, AMBAC
5.350%, 03/01/11 $ 240 $ 248
Elmore County, School District # 193,
Mountain Home GO, AMBAC
5.000%, 07/31/10 400 413
Fremont & Madison Counties,
School District # 215,
St. Anthony GO, FSA
5.600%, 08/01/14 125 131
5.600%, 08/01/15 765 799
Gooding & Lincoln Counties,
Joint School District # 231
GO, FSA
6.300%, 02/01/15 535 597
Gooding & Lincoln Counties,
Joint School District # 231
GO, FSA
6.250%, 02/01/12 130 145
Gooding County, School District
# 232, Wendell GO, AMBAC
5.000%, 08/01/11 100 101
Idaho State Building Authority
RB, MBIA
5.600%, 09/01/05 100 107
5.800%, 09/01/05 100 108
Idaho State Health Facility
Authority RB, Magic
Valley Regional
Medical Center, AMBAC
5.200%, 12/01/04 250 266
5.625%, 12/01/13 200 210
Idaho State Health Facility
Authority RB, Mercy
Medical Center
6.200%, 11/15/12 130 144
Idaho State Health Facility
Authority RB, St. Alphonsus
Regional Medical Center
6.100%, 12/01/07 100 110
Idaho State Health Facility
Authority RB, St. Joseph's
Regional Medical Center, MBIA
5.000%, 07/01/07 500 529
Idaho State Housing & Finance
Association RB, AMT
6.150%, 01/01/28 1,000 1,061
Jefferson County, School
District # 253 GO, MBIA
5.500%, 08/01/15 240 254
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
37
<PAGE>
JANUARY 31, 1998
STATEMENT OF NET ASSETS
IDAHO MUNICIPAL BOND FUND (CONCLUDED)
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
Jerome County, School
District # 262 GO, AMBAC
5.150%, 08/01/04 $ 200 $ 206
Jerome, Lincoln & Gooding
Counties GO
5.000%, 07/31/12 290 293
Kootenai County, Consolidated
Free Library District GO, FSA
5.000%, 08/01/06 160 170
Latah & Clearwater Counties,
School District # 286 GO, AMBAC
5.500%, 02/01/07 200 210
5.600%, 02/01/08 200 209
Lewiston Orchards, District Water RB
5.000%, 06/01/08 110 114
Madison County GO, FSA
5.400%, 08/01/15 420 437
Madison County, School District
# 321, Rexburg GO, AMBAC
5.300%, 02/01/03 200 208
McCall, Water RB, Parity Lien, FSA
5.750%, 03/01/07 215 238
5.850%, 03/01/16 500 540
Meridian GO, FSA
5.000%, 08/01/15 290 295
Nez Perce County, Pollution
Control RB, Potlatch
Corporation Project
6.000%, 10/01/24 1,000 1,070
Oneida County, School District
# 351 GO, MBIA
5.000%, 07/31/15 375 381
Payette County, School District
# 372 GO, Asset Guaranty
6.750%, 07/31/09 100 111
Southern Idaho Regional Solid
Waste Project COP
5.450%, 11/01/13 500 523
Teton County, School District
# 401 GO, FSA
5.300%, 08/01/07 225 243
5.500%, 08/01/10 400 429
Twin Falls & Cassia Counties,
Joint School District # 418
GO, MBIA
5.450%, 08/01/15 145 152
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
Twin Falls County, School District
# 413 GO, Class A, AMBAC
5.250%, 07/30/09 $ 200 $ 210
5.250%, 07/30/13 400 413
5.250%, 07/30/14 420 432
Twin Falls County, School
District # 415 GO, Asset Guaranty
5.500%, 08/01/15 195 204
University of Idaho, Refunding &
Improvements Facility RB
5.100%, 04/01/07 200 210
University of Idaho, Refunding
Student Building Fee RB
5.350%, 04/01/10 250 260
University of Idaho,
Student Fee RB
5.650%, 04/01/22 500 530
University of Idaho, Student Fee
Telecommunications RB, FSA
5.850%, 04/01/11 500 548
Washington County, School
District # 431 GO, AMBAC
5.300%, 08/01/04 200 211
5.400%, 08/01/05 100 106
5.500%, 08/01/06 200 212
--------
32,918
--------
PUERTO RICO -- 3.7%
Puerto Rico Commonwealth GO
5.750%, 07/01/17 250 265
Puerto Rico Municipal Finance
Agency RB, Series A
5.250%, 07/01/10 1,000 1,056
--------
1,321
--------
TOTAL MUNICIPAL BONDS
(Cost $32,456) 34,239
--------
CASH EQUIVALENT -- 1.9%
SEI Institutional
Tax-Free Portfolio 663 663
--------
TOTAL CASH EQUIVALENT
(Cost $663) 663
--------
TOTAL INVESTMENTS -- 98.7%
(Cost $33,119) 34,902
--------
OTHER ASSETS AND LIABILITIES, NET-- 1.3% 472
--------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
38
<PAGE>
THE ACHIEVEMENT FUNDS TRUST
- ---------------------------------------------------------
MARKET
DESCRIPTION VALUE (000)
- ---------------------------------------------------------
NET ASSETS:
Portfolio Shares of Institutional Class
(unlimited authorization-- no par value)
based on 2,411,630 outstanding shares
of beneficial interest $ 24,629
Portfolio Shares of Retail Class
(unlimited authorization -- no par value)
based on 855,756 outstanding shares
of beneficial interest 8,937
Accumulated net realized gain on investments 25
Net unrealized appreciation on investments 1,783
--------
TOTAL NET ASSETS-- 100.0% $ 35,374
========
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- INSTITUTIONAL CLASS $10.82
========
NET ASSET VALUE AND REDEMPTION
PRICE PER SHARE-- RETAIL CLASS $10.85
========
MAXIMUM OFFERING PRICE PER SHARE --
RETAIL CLASS ($10.85 / 96%) $11.30
========
- ---------------------------------------------------------
AMT -- ALTERNATIVE MINIMUM TAX
COP-- CERTIFICATE OF PARTICIPATION
GO -- GENERAL OBLIGATION
RB -- REVENUE BOND
THE FOLLOWING ORGANIZATIONS HAVE PROVIDED UNDERLYING CREDIT SUPPORT FOR
SECURITIES LISTED ABOVE.
ASSET GUARANTY -- ASSET GUARANTY
AMBAC -- AMERICAN
MUNICIPAL BOND ASSURANCE CORPORATION
FGIC -- FINANCIAL GUARANTY INSURANCE CORPORATION
FSA -- FINANCIAL SECURITY ASSURANCE
MBIA -- MUNICIPAL BOND INSURANCE ASSOCIATION
- ---------------------------------------------------------
MUNICIPAL BOND FUND
- ---------------------------------------------------------
[PIE CHART OMITTED]
CASH EQUIVALENTS 0.3%
GENERAL OBLIGATIONS 18.1%
REVENUE BONDS 81.6%
% OF TOTAL PORTFOLIO INVESTMENTS
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
MUNICIPAL BONDS -- 98.7%
ALABAMA -- 2.3%
Alabama State Housing Finance
Authority RB, Series B,
AMT, GNMA
6.100%, 10/01/20 $ 125 $ 131
Birmingham GO
5.700%, 06/01/15 1,000 1,055
Valley, Special Care Facilities RB,
Lanier Memorial Hospital, Series A
5.650%, 11/01/22 500 501
--------
1,687
--------
ALASKA -- 6.7%
Alaska State Housing Finance Authority
RB, MBIA
6.100%, 12/01/37 370 392
Alaska State Housing Finance Authority
RB, Series A
5.700%, 12/01/29 500 511
Alaska State Student Loan RB,
Series A, AMBAC
5.750%, 07/01/14 400 419
Alaska State Veterans Housing RB,
1st Series, GNMA
5.400%, 12/01/23 455 457
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
39
<PAGE>
JANUARY 31, 1998
STATEMENT OF NET ASSETS
MUNICIPAL BOND FUND (CONTINUED)
- ----------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
ALASKA (CONTINUED)
Valdez, Marine Term RB,
Mobil Pipeline Project
5.750%, 11/01/28 $1,000 $ 1,032
Valdez, Marine Term RB,
Mobil Pipeline Project, Series A
5.850%, 08/01/25 1,000 1,037
Valdez, Marine Term RB,
Mobil Pipeline Project, Series B
5.500%, 10/01/28 1,000 1,010
--------
4,858
--------
ARIZONA -- 2.2%
Maricopa County, Elementary
School District # 068
GO, AMBAC
5.100%, 07/01/11 500 515
Tucson GO, Series 1994-B
5.750%, 07/01/19 1,000 1,054
--------
1,569
--------
ARKANSAS -- 0.7%
Independence County, Pollution
Control RB, Power & Light Project
6.250%, 01/01/21 500 532
--------
CALIFORNIA -- 3.7%
California State Housing Finance
Agency RB, Series I, AMT, MBIA
5.750%, 02/01/29 250 260
California State Tri-City Hospital
District RB, Series A, MBIA
5.625%, 02/15/17 1,010 1,067
Los Angeles, Department of
Water & Power RB
6.000%, 07/15/32 190 201
Northern California Power Agency
RB, AMBAC,
Pre-refunded @ 100 (A)
7.500%, 07/01/21 530 704
San Francisco, Airport Improvement
RB, United Airlines, ETM
8.000%, 07/01/13 290 356
San Francisco, City & County RB,
Series A, GNMA
7.125%, 10/01/16 105 117
--------
2,705
--------
COLORADO -- 1.5%
Colorado State Board of Agriculture
RB, University of
Southern Colorado
8.250%, 05/01/03 100 105
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
Denver, City & County RB,
The Boston Loft Project,
Series A, AMT, FHA
5.750%, 10/01/27 $ 500 $ 510
Summit County, Sports Facilities RB,
Keystone Resorts Project
7.375%, 09/01/10 420 504
--------
1,119
--------
CONNECTICUT -- 0.7%
Waterbury, Housing Authority RB,
Section 8, Project A, GNMA
5.850%, 02/01/37 500 524
--------
DISTRICT OF COLUMBIA -- 0.2%
District of Columbia Housing
Finance RB, Congress Park II
Apartments, MBIA (B)
0.000%, 11/01/25 2,255 140
--------
FLORIDA -- 1.5%
Boynton Beach, Housing RB,
Clipper Cove Apartments
6.450%, 01/01/27 505 552
Florida State Housing Finance
Agency RB, Glen Oaks Apartments
Project, AMT, FNMA
5.900%, 02/01/30 500 521
--------
1,073
--------
GEORGIA -- 1.4%
Georgia State Housing & Finance Authority
RB, Subseries B2, AMT
5.850%, 12/01/28 1,000 1,036
--------
HAWAII -- 2.5%
Hawaii State Department of
Budget & Finance RB,
Wahawa General Hospital Project
7.500%, 07/01/12 250 277
Hawaii State GO, Series CN, FGIC
5.500%, 03/01/16 1,000 1,056
Hawaii State Housing Finance
& Development RB,
Series A, FNMA
5.750%, 07/01/30 500 508
--------
1,841
--------
IDAHO -- 1.3%
Idaho State Health Facilities Authority
RB, Bannock Regional
Medical Center Project
6.125%, 05/01/25 465 496
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
40
<PAGE>
THE ACHIEVEMENT FUNDS TRUST
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
Nez Perce County, Pollution
Control RB, Potlatch
Corporation Project
6.000%, 10/01/24 $ 450 $ 481
--------
977
--------
ILLINOIS -- 8.7%
Bryant, Pollution Control RB,
Central Illinois Light Company
5.900%, 08/01/23 1,000 1,044
Chicago, Board of Education
GO, MBIA
6.000%, 12/01/26 150 162
Chicago, Housing Authority RB,
Bryne Mawr/Belle Project,
AMT, GNMA
6.125%, 06/01/39 500 533
Cook County RB, Series B, FGIC,
Pre-refunded @ 102 (A)
6.000%, 11/15/02 200 219
Illinois State Housing Development
Authority RB, HUD Section 8
7.000%, 07/01/17 90 91
Illinois State Toll Highway Priority
RB, Series A, FGIC
6.200%, 01/01/16 1,000 1,084
Kane, Cook & Du Page Counties,
School District # 46 GO, FSA
5.550%, 01/01/11 1,000 1,065
McHenry County, Community Unit
School District # 200 GO,
Series A, FSA
5.850%, 01/01/16 1,000 1,070
Rockford, Faust Landmark
Apartments RB, Series A, MBIA
6.750%, 01/01/18 1,000 1,109
--------
6,377
--------
INDIANA -- 2.0%
Ball State University Student Fee
RB, Series G, FGIC
6.125%, 07/01/14 500 539
Hammond, Multi-School Building
RB, FGIC
6.125%, 07/15/19 720 779
Indiana State Toll Financial
Authority RB
6.000%, 07/01/13 25 25
Petersburg, Pollution Control RB,
Indianapolis Power & Light
6.625%, 12/01/24 105 118
--------
1,461
--------
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
IOWA -- 2.1%
Iowa City, Sewer RB, MBIA
5.750%, 07/01/21 $1,000 $ 1,049
Iowa State Finance Authority RB,
Series F, GNMA
5.700%, 01/01/27 500 514
--------
1,563
--------
KANSAS -- 0.4%
Newton, Hospital RB,
Newton Healthcare, Series A
7.375%, 11/15/14 250 278
--------
KENTUCKY -- 0.9%
Kentucky State Economic Development
RB, Appalachian Hospital System
5.875%, 10/01/22 500 516
University of Louisville Consolidated
Educational Building RB, Series H
5.875%, 05/01/11 100 107
--------
623
--------
MAINE -- 4.2%
Maine State Health & Higher Education
Facilities RB, Series B, AMBAC
5.750%, 07/01/26 1,000 1,061
Maine State Housing Authority
RB, Series D2, AMT
5.900%, 11/15/25 1,000 1,029
Maine State Housing Authority
RB, Series F1
5.500%, 11/15/29 1,000 1,007
--------
3,097
--------
MASSACHUSETTS -- 0.3%
Massachusetts State Health &
Educational Facilities Authority
RB, Melrose-Wakefield Hospital,
Series B, ETM, GOH
5.875%, 07/01/18 200 224
--------
MICHIGAN -- 4.4%
Lake Orion, Community School
District GO, AMBAC
5.800%, 05/01/15 1,000 1,068
Michigan State Housing Development
Authority RB, FHA
5.700%, 07/01/06 115 115
Plymouth-Canton, Community School
District GO, Series A, QSBLF
6.625%, 05/01/16 400 430
Romulus, Community School
Capital Appreciation RB,
Series II, FGIC,
Pre-refunded @ 36.70 (A) (B)
0.000%, 05/01/07 2,305 562
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
41
<PAGE>
JANUARY 31, 1998
STATEMENT OF NET ASSETS
MUNICIPAL BOND FUND (CONTINUED)
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
MICHIGAN (CONTINUED)
Ypsilanti, School District
GO, FGIC
5.750%, 05/01/20 $1,000 $ 1,060
--------
3,235
--------
MISSISSIPPI -- 0.7%
Mississippi State Hospital
Equipment & Facility RB,
Magnolia Hospital Project
7.375%, 10/01/21 500 535
--------
MISSOURI -- 1.0%
Missouri State Health & Education
Facilities RB, SSM Health Care
Projects, Series B, ETM, MBIA
7.000%, 06/01/15 650 732
--------
NEVADA -- 2.2%
Nevada State Housing
Division RB, Issue C-1, FHA
6.500%, 10/01/16 200 214
Nevada State Housing
Division RB, Saratoga
Palms, FNMA
6.250%, 10/01/16 280 298
Nevada State Municipal
Bond Bank GO,
Project 52, Series A
6.000%, 05/15/24 1,000 1,086
--------
1,598
--------
NEW HAMPSHIRE -- 0.9%
New Hampshire State Higher
Education & Health Facilities RB,
Nashua Memorial Hospital
6.250%, 10/01/08 630 675
--------
NEW MEXICO -- 2.7%
Bernalillo County, Gross
Receipts Tax
RB, Series A
5.750%, 04/01/21 1,000 1,095
Carlsbad, Housing RB,
Colonial Hillcrest
7.375%, 08/01/27 375 404
Southeastern New Mexico
Affordable Housing RB,
Casa Hermosa Apartments
7.250%, 12/01/27 430 436
--------
1,935
--------
NEW YORK -- 5.1%
New York State Dormitory Authority RB,
Menorah Campus, FHA
6.100%, 02/01/37 1,000 1,063
New York State Ideal
Senior Living
Center Housing RB
5.900%, 08/01/26 500 526
New York State Local Government
Assistance RB, Series A
6.000%, 04/01/24 100 108
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
New York State Metropolitan Transit
Authority RB, Series C1
5.625%, 07/01/27 $1,000 $ 1,025
United Nations Development
RB, Series B
5.600%, 07/01/26 1,000 1,004
--------
3,726
--------
NORTH CAROLINA -- 2.5%
North Carolina State Eastern
Municipal Power Agency RB,
Catawba Electric, Series B
6.000%, 01/01/20 945 951
North Carolina State Eastern
Municipal Power Agency RB,
Series A, Pre-refunded @ 100 (A)
6.000%, 01/01/22 480 558
North Carolina State Eastern
Municipal Power Agency
RB, Series B
5.500%, 01/01/21 310 310
--------
1,819
--------
NORTH DAKOTA -- 1.3%
Fargo, Housing RB
7.125%, 02/01/26 255 261
North Dakota State Housing Finance
Agency RB, Series C, AMT
5.950%, 07/01/17 280 298
6.100%, 07/01/28 365 381
--------
940
--------
OHIO -- 2.5%
Johnstown, Waterworks System RB
6.000%, 12/01/17 250 261
Montgomery, Special Assessment
RB, Montgomery Woods Project
6.000%, 12/01/17 76 81
Oak Hills, Local School District
GO, Series A
5.700%, 12/01/25 500 520
University of Cincinnati General
Receipts RB, Series AA1
5.000%, 06/01/18 1,000 981
--------
1,843
--------
OREGON -- 1.5%
Lincoln County, School District
GO, FGIC
5.600%, 06/15/10 1,000 1,096
--------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
42
<PAGE>
THE ACHIEVEMENT FUNDS TRUST
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
PENNSYLVANIA -- 8.8%
Allegheny County, Hospital
Development Authority RB,
Ohio Valley General Hospital
5.875%, 04/01/11 $ 500 $ 517
Allentown, Hospital Authority
RB, Sacred Heart Hospital
of Allentown, Series A
6.750%, 11/15/14 500 548
Delaware County, Health Care
Authority RB, Mercy Health
Corporation, Series B,
Pre-refunded @ 100 (A)
6.000%, 11/15/05 500 556
Delaware County, Hospital
Authority RB, Crozer-Chester
Medical Center
6.000%, 12/15/09 500 529
6.000%, 12/15/20 500 519
Pennsylvania State Housing
Finance Agency RB, Series 39B
6.875%, 10/01/24 750 817
Pennsylvania State Housing
Finance Agency RB, Series
59A, AMT
5.800%, 10/01/29 1,250 1,298
Philadelphia, Hospital
Facilities Authority RB,
Friends Hospital
6.200%, 05/01/11 500 528
Scranton-Lackawanna, Health &
Welfare Authority RB, Moses
Taylor Hospital Project
6.250%, 07/01/20 500 536
Warren County, Hospital
Authority
RB, Series A
6.900%, 04/01/11 500 553
--------
6,401
--------
PUERTO RICO -- 1.5%
Puerto Rico Commonwealth GO
5.750%, 07/01/17 1,000 1,060
--------
RHODE ISLAND -- 2.1%
Rhode Island State Health &
Education Building RB
5.700%, 07/01/15 500 503
Rhode Island State Housing &
Mortgage Finance Authority RB,
Series 23, AMT
5.950%, 04/01/29 1,000 1,036
--------
1,539
--------
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
SOUTH CAROLINA -- 2.9%
Peidmont, Municipal Power Agency
RB, Series A
5.750%, 01/01/24 $1,050 $ 1,051
University of South Carolina
RB, MBIA
5.750%, 06/01/26 1,000 1,060
--------
2,111
--------
SOUTH DAKOTA -- 0.8%
South Dakota State Health &
Education Facilities RB,
Huron Regional Medical Center
7.250%, 04/01/20 500 555
--------
TEXAS -- 1.2%
Harris County, Industrial Development
RB, Gatx Terminals Project
6.950%, 02/01/22 500 548
Texarkana, Health Facilities RB,
Wadley Regional Medical Center,
Series B, MBIA
6.000%, 10/01/17 160 179
Victoria County, Hospital RB,
Citizens Medical Center, AMBAC
6.250%, 01/01/16 100 109
--------
836
--------
UTAH -- 3.5%
Provo City, Housing Authority RB,
Lookout Pointe Apartments, GNMA
5.800%, 07/20/22 500 516
Salt Lake County, Westminster
College Project RB
5.750%, 10/01/27 250 258
Utah State Building Ownership
Authority Lease RB, State
Facilities Master Lease,
Series A, AMBAC
5.750%, 05/15/18 300 316
Utah State Housing Finance
Agency RB, FHA
6.800%, 01/01/12 315 337
Utah State Intermountain Power
Agency RB, Series C
5.750%, 07/01/20 105 105
Weber County, Municipal
Building Authority RB, MBIA
5.750%, 12/15/19 1,000 1,055
--------
2,587
--------
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
43
<PAGE>
JANUARY 31, 1998
STATEMENT OF NET ASSETS
MUNICIPAL BOND FUND (CONCLUDED)
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
VERMONT -- 2.0%
Vermont State Housing Finance
Agency RB, Series 9, AMT, MBIA
6.000%, 05/01/37 $ 595 $ 620
Vermont State Student Assistance
Financing RB, Series B, AMT, FSA
6.700%, 12/15/12 800 873
--------
1,493
--------
WASHINGTON -- 1.6%
Bellingham, Housing Authority RB,
Cascade Meadows Project
7.100%, 11/01/23 200 216
7.000%, 11/01/25 200 219
Bellingham, Housing Authority RB,
Pacific Rim Project
6.500%, 10/01/22 100 106
Washington State Development RB,
Tramco Project
6.000%, 08/01/23 510 529
Washington State Health Facilities
RB, Puget Sound Group
Health Co-op, MBIA
6.250%, 12/01/21 100 105
--------
1,175
--------
WISCONSIN -- 3.3%
Wisconsin State GO, Series D, AMT
5.800%, 05/01/20 145 151
Wisconsin State Health & Education
Facilities RB, Franciscan
Skemp Medical Center
6.125%, 11/15/15 1,000 1,084
Wisconsin State Health & Education
Facilities RB, Hess Memorial
Hospital Association
7.875%, 11/01/22 500 580
Wisconsin State Housing & Economic
Development RB, Series A
6.000%, 09/01/15 550 580
--------
2,395
--------
WYOMING -- 2.9%
Jackson, National Rural Utilities
Co-op RB, AMT
5.875%, 05/01/26 500 524
Wyoming State Community
Development Authority RB,
Series 4, AMT
5.850%, 06/01/28 500 518
Wyoming State Community
Development Authority RB,
Series A, FHA
6.000%, 06/01/23 1,000 1,043
--------
2,085
--------
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
TOTAL MUNICIPAL BONDS
(Cost $69,815) $ 72,055
--------
CASH EQUIVALENT -- 0.3%
SEI Institutional
Tax-Free Portfolio $182 182
--------
TOTAL CASH EQUIVALENT
(Cost $182) 182
--------
TOTAL INVESTMENTS -- 99.0%
(Cost $69,997) 72,237
--------
OTHER ASSETS AND LIABILITIES, NET-- 1.0% 734
--------
NET ASSETS:
Portfolio Shares of Institutional Class
(unlimited authorization -- no par value)
based on 6,069,188 outstanding shares
of beneficial interest 60,867
Portfolio Shares of Retail Class
(unlimited authorization -- no par value)
based on 957,984 outstanding shares
of beneficial interest 9,595
Accumulated net realized gain on investments 269
Net unrealized appreciation on investments 2,240
--------
TOTAL NET ASSETS-- 100.0% $ 72,971
========
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE-- INSTITUTIONAL CLASS $10.38
========
NET ASSET VALUE AND REDEMPTION
PRICE PER SHARE-- RETAIL CLASS $10.38
========
MAXIMUM OFFERING PRICE PER SHARE --
RETAIL CLASS ($10.38 / 96%) $10.81
========
- ---------------------------------------------------------
(A) PRE-REFUNDED SECURITY. THE PRE-REFUNDED DATE IS SHOWN AS THE MATURITY DATE
ON THE STATEMENT OF NET ASSETS.
(B) ZERO COUPON SECURITY
AMT -- ALTERNATIVE MINIMUM TAX
ETM -- ESCROWED TO MATURITY
GO -- GENERAL OBLIGATION
RB -- REVENUE BOND
THE FOLLOWING ORGANIZATIONS HAVE PROVIDED UNDERLYING CREDIT SUPPORT FOR
SECURITIES LISTED ABOVE.
AMBAC -- AMERICAN MUNICIPAL BOND ASSURANCE CORPORATION
FGIC -- FINANCIAL GUARANTY INSURANCE CORPORATION
FHA -- FEDERAL HOUSING ADMINISTRATION
FNMA -- FEDERAL NATIONAL MORTGAGE ASSOCIATION
FSA -- FINANCIAL SECURITY INSURANCE
GNMA -- GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
GOH -- GENERAL OBLIGATION OF HOSPITAL
HUD -- DEPARTMENT OF HOUSING & URBAN DEVELOPMENT
MBIA -- MUNICIPAL BOND INSURANCE ASSOCIATION
QSBLF -- QUALIFIED-SCHOOL BOND LOAN FUND
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
44
<PAGE>
FOR THE YEAR ENDED JANUARY 31, 1998 THE ACHIEVEMENT FUNDS TRUST
STATEMENTS OF OPERATIONS (000)
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------
SHORT
SHORT TERM IDAHO
INTERMEDIATE TERM MUNICIPAL MUNICIPAL MUNICIPAL
EQUITY BALANCED TERM BOND BOND BOND BOND BOND
FUND FUND FUND FUND FUND FUND FUND
======= ======= ============ ===== ========= ========= =========
INCOME:
<S> <C> <C> <C> <C> <C> <C> <C>
Dividend Income $ 2,684 $ 1,585 $ -- $ -- $ -- $ -- $ --
Interest Income 285 4,148 9,988 3,673 887 1,797 3,705
------- ------- ------- ------ ---- ------ ------
Total Income 2,969 5,733 9,988 3,673 887 1,797 3,705
------- ------- ------- ----- ---- ------ ------
EXPENSES:
Administrative Fees 389 339 296 114 100 100 135
Less: Waiver of Administrative Fees -- -- -- -- (61) (31) --
Investment Advisory Fees 1,440 1,253 888 343 119 207 406
Less: Waiver of Investment
Advisory Fees (199) (213) (179) (115) (56) (100) (205)
Custodian/Transfer Agent Fees 55 53 52 46 44 45 47
Professional Fees 52 30 39 17 5 9 22
Pricing Fees 5 5 4 2 1 4 3
Registration & Filing Fees (39) 12 (25) 2 (12) 14 76
Printing Fees 30 26 22 9 3 6 11
Trustee Fees 9 7 7 3 1 2 3
Distribution Fees (1) 15 8 6 1 1 22 23
Interest and Other Expenses 3 -- -- -- -- -- 1
Amortization of Deferred
Organizational Costs 9 10 6 7 3 2 8
------- ------- ------- ----- ---- ------ ------
Total Expenses 1,769 1,530 1,116 429 148 280 530
------- ------- ------- ----- ---- ------ ------
Net Income 1,200 4,203 8,872 3,244 739 1,517 3,175
------- ------- ------- ----- ---- ------ ------
Net Realized Gain (Loss) on
Investments 18,358 10,936 (389) (253) 65 70 1,138
Net Change in Unrealized
Appreciation/(Depreciation)
of Investments 19,189 11,733 4,245 426 6 1,413 2,226
------- ------- ------- ----- ---- ------ ------
Net Realized and Unrealized Gain
on Investments 37,547 22,669 3,856 173 71 1,483 3,364
------- ------- ------- ----- ---- ------ -----
Increase in Net Assets Resulting
from Operations $38,747 $26,872 $12,728 $3,417 $810 $3,000 $6,539
======= ======= ======= ====== ==== ====== ======
<FN>
(1) ALL DISTRIBUTION FEES ARE INCURRED IN RETAIL CLASS A.
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
</FN>
</TABLE>
45
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS (000)
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
EQUITY BALANCED INTERMEDIATE
FUND FUND TERM BOND FUND
===================== ===================== ===================
2/1/97 2/1/96 2/1/97 2/1/96 2/1/97 2/1/96
TO TO TO TO TO TO
1/31/98 1/31/97 1/31/98 1/31/97 1/31/98 1/31/97
-------- -------- -------- -------- -------- --------
INVESTMENT ACTIVITIES:
<S> <C> <C> <C> <C> <C> <C>
Net Investment Income $ 1,200 $ 1,328 $ 4,203 $ 4,368 $ 8,872 $ 7,450
Net Realized Gain (Loss) on Investments 18,358 20,025 10,936 9,456 (389) (558)
Net Change in Unrealized
Appreciation (Depreciation) of Investments 19,189 9,415 11,733 3,898 4,245 (4,069)
-------- -------- -------- -------- -------- --------
Increase in Net Assets
Resulting From Operations 38,747 30,768 26,872 17,722 12,728 2,823
-------- -------- -------- -------- -------- --------
DISTRIBUTIONS TO SHAREHOLDERS:
Net Investment Income:
Institutional Class (1,184) (1,384) (3,878) (4,369) (8,727) (7,349)
Retail Class A (26) (20) (67) (64) (146) (101)
Capital Gains:
Institutional Class (20,133) (11,493) (8,323) (9,727) -- --
Retail Class A (852) (261) (176) (166) -- --
-------- -------- -------- -------- -------- --------
Total Distributions (22,195) (13,158) (12,444) (14,326) (8,873) (7,450)
-------- -------- -------- -------- -------- --------
CAPITAL SHARE TRANSACTIONS:
Institutional Class:
Proceeds from Shares Issued 32,263 30,191 14,194 14,417 44,870 42,280
Reinvestment of Cash Distributions 6,033 3,338 12,192 14,012 1,565 1,500
Cost of Shares Redeemed (36,401) (24,484) (21,130) (22,812) (23,136) (19,835)
-------- -------- -------- -------- -------- --------
Total Institutional Class Transactions 1,895 9,045 5,256 5,617 23,299 23,945
-------- -------- -------- -------- -------- --------
Retail Class A:
Proceeds from Shares Issued 6,827 2,796 968 1,788 757 2,819
Reinvestment of Cash Distributions 843 254 239 225 139 82
Cost of Shares Redeemed (2,194) (1,098) (461) (857) (907) (1,114)
-------- -------- -------- -------- -------- --------
Total Retail Class A Transactions 5,476 1,952 746 1,156 (11) 1,787
-------- -------- -------- -------- -------- --------
Net Increase (Decrease) in Net
Assets from Share Transactions 7,371 10,997 6,002 6,773 23,288 25,732
-------- -------- -------- -------- -------- --------
Total Increase (Decrease) in Net Assets 23,923 28,607 20,430 10,169 27,143 21,105
NET ASSETS:
Beginning of Period 181,333 152,726 159,190 149,021 137,375 116,270
-------- -------- -------- -------- -------- --------
End of Period $205,256 $181,333 $179,620 $159,190 $164,518 $137,375
======== ======== ======== ======== ======== ========
SHARES ISSUED AND REDEEMED:
Institutional Class
Shares Issued 2,097 2,308 1,102 1,240 4,313 4,075
Shares Issued in Lieu of Cash Distributions 388 253 950 1,201 151 145
Shares Redeemed (2,373) (1,871) (1,650) (1,931) (2,228) (1,919)
-------- -------- -------- -------- -------- --------
Total Institutional Class Share Transactions 112 690 402 510 2,236 2,301
-------- -------- -------- -------- -------- --------
Retail Class A
Shares Issued 434 216 74 152 72 273
Shares Issued in Lieu of Cash Distributions 54 19 19 19 13 8
Shares Redeemed (144) (83) (36) (73) (87) (107)
-------- -------- -------- -------- -------- --------
Total Retail Class A Share Transactions 344 152 57 98 (2) 174
-------- -------- -------- -------- -------- --------
Net Increase (Decrease) in Share Transactions 456 842 459 608 2,234 2,475
======== ======== ======== ======== ======== ========
<FN>
(1) COMMENCED OPERATIONS ON NOVEMBER 1, 1996.
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
</FN>
</TABLE>
46 & 47
<PAGE>
THE ACHIEVEMENT FUNDS TRUST
<TABLE>
<CAPTION>
SHORT TERM SHORT TERM
BOND FUND MUNICIPAL BOND FUND
=================== ===================
2/1/97 2/1/96 2/1/97 2/1/96
TO TO TO TO
1/31/98 1/31/97 1/31/98 1/31/97
-------- -------- ------- --------
INVESTMENT ACTIVITIES:
<S> <C> <C> <C> <C>
Net Investment Income $ 3,244 $ 4,266 $ 739 $ 1,034
Net Realized Gain (Loss) on Investments (253) (40) 65 130
Net Change in Unrealized
Appreciation (Depreciation) of Investments 426 (1,241) 6 (441)
-------- -------- ------- --------
Increase in Net Assets
Resulting From Operations 3,417 2,985 810 723
-------- -------- ------- --------
DISTRIBUTIONS TO SHAREHOLDERS:
Net Investment Income:
Institutional Class (3,230) (4,239) (740) (1,031)
Retail Class A (14) (27) (8) (8)
Capital Gains:
Institutional Class -- -- (125) (152)
Retail Class A -- -- (2) (2)
-------- -------- ------- --------
Total Distributions (3,244) (4,266) (875) (1,193)
-------- -------- ------- --------
CAPITAL SHARE TRANSACTIONS:
Institutional Class:
Proceeds from Shares Issued 12,725 23,170 2,668 2,746
Reinvestment of Cash Distributions 1,122 1,276 6 3
Cost of Shares Redeemed (28,495) (33,471) (8,830) (11,740)
-------- -------- ------- --------
Total Institutional Class Transactions (14,648) (9,025) (6,156) (8,991)
-------- -------- ------- --------
Retail Class A:
Proceeds from Shares Issued 122 789 65 53
Reinvestment of Cash Distributions 9 6 10 10
Cost of Shares Redeemed (370) (389) (79) (44)
-------- -------- ------- --------
Total Retail Class A Transactions (239) 406 (4) 19
-------- -------- ------- --------
Net Increase (Decrease) in Net
Assets from Share Transactions (14,887) (8,619) (6,160) (8,972)
-------- -------- ------- --------
Total Increase (Decrease) in Net Assets (14,714) (9,900) (6,225) (9,442)
NET ASSETS:
Beginning of Period 65,771 75,671 22,074 31,516
-------- -------- ------- --------
End of Period $ 51,057 $ 65,771 $15,849 $ 22,074
======== ======== ======= ========
SHARES ISSUED AND REDEEMED:
Institutional Class
Shares Issued 1,273 2,307 266 272
Shares Issued in Lieu of Cash Distributions 112 127 1 --
Shares Redeemed (2,852) (3,334) (879) (1,164)
-------- -------- ------- --------
Total Institutional Class Share Transactions (1,467) (900) (612) (892)
-------- -------- ------- --------
Retail Class A
Shares Issued 12 78 6 5
Shares Issued in Lieu of Cash Distributions 1 1 1 1
Shares Redeemed (37) (39) (8) (4)
-------- -------- ------- --------
Total Retail Class A Share Transactions (24) 40 (1) 2
-------- -------- ------- --------
Net Increase (Decrease) in Share Transactions (1,491) (860) (613) (890)
======== ======== ======= ========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
</TABLE>
47
<PAGE>
THE ACHIEVEMENT FUNDS TRUST
<TABLE>
<CAPTION>
IDAHO MUNICIPAL
MUNICIPAL BOND BOND FUND
=================== ====================
2/1/97 2/1/96 2/1/97 11/1/96(1)
TO TO TO TO
1/31/98 1/31/97 1/31/98 1/31/97
------- ------- ------- ----------
INVESTMENT ACTIVITIES:
<S> <C> <C> <C> <C>
Net Investment Income $ 1,517 $ 1,303 $ 3,175 $ 626
Net Realized Gain (Loss) on Investments 70 151 1,138 10
Net Change in Unrealized
Appreciation (Depreciation) of Investments 1,413 (1,032) 2,226 14
------- ------- ------- -------
Increase in Net Assets
Resulting From Operations 3,000 422 6,539 650
------- ------- ------- -------
DISTRIBUTIONS TO SHAREHOLDERS:
Net Investment Income:
Institutional Class (1,132) (1,190) (2,761) (605)
Retail Class A (385) (119) (414) (21)
Capital Gains:
Institutional Class (90) (158) (763) --
Retail Class A (34) (17) (116) --
------- ------- ------- -------
Total Distributions (1,641) (1,484) (4,054) (626)
------- ------- ------- -------
CAPITAL SHARE TRANSACTIONS:
Institutional Class:
Proceeds from Shares Issued 5,810 7,141 16,991 57,201
Reinvestment of Cash Distributions 24 15 11 --
Cost of Shares Redeemed (8,204) (4,601) (9,182) (4,154)
------- ------- ------- -------
Total Institutional Class Transactions (2,370) 2,555 7,820 53,047
------- ------- ------- -------
Retail Class A:
Proceeds from Shares Issued 4,939 4,886 7,604 5,553
Reinvestment of Cash Distributions 385 130 530 21
Cost of Shares Redeemed (1,901) (2,529) (3,430) (683)
------- ------- ------- -------
Total Retail Class A Transactions 3,423 2,487 4,704 4,891
------- ------- ------- -------
Net Increase (Decrease) in Net
Assets from Share Transactions 1,053 5,042 12,524 57,938
------- ------- ------- -------
Total Increase (Decrease) in Net Assets 2,412 3,980 15,009 57,962
NET ASSETS:
Beginning of Period 32,962 28,982 57,962 --
------- ------- ------- -------
End of Period $35,374 $32,962 $72,971 $57,962
======= ======= ======= =======
SHARES ISSUED AND REDEEMED:
Institutional Class
Shares Issued 551 683 1,673 5,709
Shares Issued in Lieu of Cash Distributions 2 2 1 --
Shares Redeemed (782) (440) (901) (413)
------- ------- ------- -------
Total Institutional Class Share Transactions (229) 245 773 5,296
------- ------- ------- -------
Retail Class A
Shares Issued 474 467 757 555
Shares Issued in Lieu of Cash Distributions 37 12 52 2
Shares Redeemed (179) (242) (340) (68)
------- ------- ------- -------
Total Retail Class A Share Transactions 332 237 469 489
------- ------- ------- -------
Net Increase (Decrease) in Share Transactions 103 482 1,242 5,785
======= ======= ======= =======
<FN>
(1) COMMENCED OPERATIONS ON NOVEMBER 1, 1996.
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
</FN>
</TABLE>
47
<PAGE>
FINANCIAL HIGHLIGHTS
- -------------------------------------------------------------------------------
For a Share Outstanding Throughout the Period or Year
<TABLE>
<CAPTION>
NET
ASSET DISTRIBUTIONS DISTRIBUTIONS REALIZED AND NET NET
VALUE, NET FROM NET FROM UNREALIZED ASSET VALUE, ASSETS, END
BEGINNING INVESTMENT INVESTMENT CAPITAL GAINS (LOSSES) END TOTAL OF PERIOD
OF PERIOD INCOME INCOME GAINS ON INVESTMENTS OF PERIOD RETURN+ (000)
--------- ---------- ------------- ------------- -------------- ------------ ------- ----------
EQUITY FUND
===========
INSTITUTIONAL CLASS:
For the years ended
<S> <C> <C> <C> <C> <C> <C> <C> <C>
January 31, 1998 $14.03 0.10 (0.10) (1.68) 2.99 $15.34 22.14% $195,500
January 31, 1997 $12.64 0.11 (0.11) (0.94) 2.33 $14.03 20.00% $177,234
January 31, 1996 $10.24 0.17 (0.17) (0.72) 3.12 $12.64 32.55% $150,957
For the period ended
January 31, 1995(1)** $10.00 0.01 -- -- 0.23 $10.24 2.40% $ 97,052
RETAIL CLASS A:
For the years ended
January 31, 1998 $14.04 0.06 (0.06) (1.68) 2.98 $15.34 21.78% $ 9,756
January 31, 1997 $12.65 0.08 (0.08) (0.94) 2.33 $14.04 19.72% $ 4,099
For the period ended
January 31, 1996(2)** $10.52 0.14 (0.15) (0.72) 2.86 $12.65 32.34%* $ 1,769
BALANCED FUND
=============
INSTITUTIONAL CLASS:
For the years ended
January 31, 1998 $12.01 0.32 (0.30) (0.64) 1.71 $13.10 17.28% $175,751
January 31, 1997 $11.79 0.34 (0.35) (0.78) 1.01 $12.01 12.03% $156,315
January 31, 1996 $10.20 0.39 (0.39) (0.42) 2.01 $11.79 24.15% $147,357
For the period ended
January 31, 1995(1)** $10.00 0.04 -- -- 0.16 $10.20 2.00%* $112,896
RETAIL CLASS A:
For the years ended
January 31, 1998 $12.00 0.28 (0.27) (0.64) 1.71 $13.08 16.92% $ 3,869
January 31, 1997 $11.78 0.31 (0.32) (0.78) 1.01 $12.00 11.81% $ 2,875
For the period ended
January 31, 1996(2)** $10.34 0.32 (0.31) (0.42) 1.85 $11.78 23.88%* $ 1,664
</TABLE>
<TABLE>
<CAPTION>
RATIO RATIO OF
OF EXPENSES NET INCOME
RATIO TO AVERAGE RATIO OF TO AVERAGE
OF EXPENSES NET ASSETS NET INCOME NET ASSETS PORTFOLIO AVERAGE
TO AVERAGE (EXCLUDING TO AVERAGE (EXCLUDING TURNOVER COMMISSION
NET ASSETS WAIVERS) NET ASSETS WAIVERS) RATE RATE(5)
----------- ----------- ----------- ---------- --------- -------
EQUITY FUND
===========
INSTITUTIONAL CLASS:
For the years ended
<S> <C> <C> <C> <C> <C> <C>
January 31, 1998 0.90% 1.00% 0.63% 0.53% 36.68% $0.0603
January 31, 1997 0.90% 1.07% 0.81% 0.64% 97.14% $0.0603
January 31, 1996 0.90% 1.14% 1.43% 1.19% 103.85% n/a
For the period ended
January 31, 1995(1)** 0.90% 1.26% 1.22% 0.86% 6.03% n/a
RETAIL CLASS A:
For the years ended
January 31, 1998 1.15% 1.28% 0.33% 0.20% 36.68% $0.0603
January 31, 1997 1.15% 1.31% 0.52% 0.36% 97.14% $0.0603
For the period ended
January 31, 1996(2)** 1.15% 1.37% 0.99% 0.77% 103.85% n/a
BALANCED FUND
=============
INSTITUTIONAL CLASS:
For the years ended
January 31, 1998 0.90% 1.02% 2.49% 2.37% 30.91% $0.0600
January 31, 1997 0.90% 1.07% 2.90% 2.73% 68.11% $0.0601
January 31, 1996 0.90% 1.14% 3.48% 3.24% 59.74% n/a
For the period ended
January 31, 1995(1)** 0.90% 1.26% 3.61% 3.25% 1.70% n/a
RETAIL CLASS A:
For the years endeD
January 31, 1998 1.15% 1.27% 2.23% 2.11% 30.91% $0.0600
January 31, 1997 1.15% 1.32% 2.64% 2.47% 68.11% $0.0601
For the period ended
January 31, 1996(2)** 1.15% 1.38% 3.06% 2.83% 59.74% n/a
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF FINANCIAL STATEMENTS.
48
<PAGE>
THE ACHIEVEMENT FUNDS TRUST
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NET
ASSET DISTRIBUTIONS DISTRIBUTIONS REALIZED AND NET NET
VALUE, NET FROM NET FROM UNREALIZED ASSET VALUE, ASSETS, END
BEGINNING INVESTMENT INVESTMENT CAPITAL GAINS (LOSSES) END TOTAL OF PERIOD
OF PERIOD INCOME INCOME GAINS ON INVESTMENTS OF PERIOD RETURN+ (000)
--------- ---------- ------------- ------------- -------------- ------------ ------- -----------
INTERMEDIATE TERM
BOND FUND
=================
INSTITUTIONAL CLASS:
For the years ended
<S> <C> <C> <C> <C> <C> <C> <C>
January 31, 1998 $10.37 0.62 (0.62) -- 0.26 $10.63 8.82% $161,742
January 31, 1997 $10.79 0.62 (0.62) -- (0.42) $10.37 2.06% $134,645
January 31, 1996 $10.09 0.71 (0.70) -- 0.69 $10.79 13.62% $115,307
For the period ended
January 31, 1995(1)** $10.00 0.05 (0.06) -- 0.10 $10.09 1.54%* $ 65,633
RETAIL CLASS A:
For the years ended
January 31, 1998 $10.40 0.60 (0.60) -- 0.26 $10.66 8.60% $ 2,776
January 31, 1997 $10.82 0.60 (0.60) -- (0.42) $10.40 1.80% $ 2,730
For the period ended
January 31, 1996(2)** $10.16 0.56 (0.55) -- 0.65 $10.82 13.49%* $ 963
SHORT TERM
BOND FUND
===========
INSTITUTIONAL CLASS:
For the years ended
January 31, 1998 $10.01 0.57 (0.57) -- 0.04 $10.05 6.25% $ 50,853
January 31, 1997 $10.18 0.60 (0.60) -- (0.17) $10.01 4.40% $ 65,328
January 31, 1996 $10.02 0.67 (0.65) -- 0.14 $10.18 7.80% $ 75,632
For the period ended
January 31, 1995(1)** $10.00 0.04 (0.06) -- 0.04 $10.02 0.79%* $ 70,380
RETAIL CLASS A:
For the years ended
January 31, 1998 $10.00 0.55 (0.55) -- 0.04 $10.04 6.04% $ 204
January 31, 1997 $10.18 0.57 (0.58) -- (0.17) $10.00 4.04% $ 443
For the period ended
January 31, 1996(2)** $10.03 0.53 (0.52) -- 0.14 $10.18 7.55%* $ 39
</TABLE>
<TABLE>
<CAPTION>
RATIO RATIO OF
OF EXPENSES NET INCOME
RATIO TO AVERAGE RATIO OF TO AVERAGE
OF EXPENSES NET ASSETS NET INCOME NET ASSETS PORTFOLIO AVERAGE
TO AVERAGE (EXCLUDING TO AVERAGE (EXCLUDING TURNOVER COMMISSION
NET ASSETS WAIVERS) NET ASSETS WAIVERS) RATE RATE(5)
----------- ----------- ----------- ---------- --------- ----------
INTERMEDIATE TERM
BOND FUND
=================
INSTITUTIONAL CLASS:
For the years ended
<S> <C> <C> <C> <C> <C> <C>
January 31, 1998 0.75% 0.87% 5.99% 5.87% 20.91% n/a
January 31, 1997 0.75% 0.95% 6.02% 5.82% 21.23% n/a
January 31, 1996 0.75% 1.02% 6.14% 5.87% 85.16% n/a
For the period ended
January 31, 1995(1)** 0.75% 1.13% 5.60% 5.22% 10.57% n/a
RETAIL CLASS A:
For the years ended
January 31, 1998 1.00% 1.11% 5.75% 5.64% 20.91% n/a
January 31, 1997 1.00% 1.18% 5.76% 5.58% 21.23% n/a
For the period ended
January 31, 1996(2)** 1.00% 1.26% 5.74% 5.48% 85.16% n/a
SHORT TERM
BOND FUND
===========
INSTITUTIONAL CLASS:
For the years ended
January 31, 1998 0.75% 0.95% 5.68% 5.48% 48.90% n/a
January 31, 1997 0.75% 0.96% 6.00% 5.79% 40.80% n/a
January 31, 1996 0.75% 0.99% 6.11% 5.87% 83.64% n/a
For the period ended
January 31, 1995(1)** 0.75% 1.13% 4.21% 3.83% 11.95% n/a
RETAIL CLASS A:
For the years ended
January 31, 1998 1.00% 1.18% 5.43% 5.25% 48.90% n/a
January 31, 1997 1.00% 1.20% 5.74% 5.54% 40.80% n/a
For the period ended
January 31, 1996(2)** 1.00% 1.23% 5.75% 5.52% 83.64% n/a
<FN>
* RETURNS ARE FOR THE PERIOD INDICATED AND HAVE NOT BEEN ANNUALIZED.
** RATIOS FOR THE PERIOD HAVE BEEN ANNUALIZED.
+ RETURNS DO NOT REFLECT ANY SALES LOAD THAT MAY BE APPLICABLE.
(1) COMMENCED OPERATIONS ON DECEMBER 28, 1994.
(2) COMMENCED OPERATIONS ON MARCH 6, 1995.
(3) COMMENCED OPERATIONS ON NOVEMBER 1, 1996.
(4) COMMENCED OPERATIONS ON NOVEMBER 4, 1996.
(5) AVERAGE COMMISSION RATE PAID PER SHARE FOR SECURITY PURCHASES AND
SALES DURING THE PERIOD. PRESENTATION OF THE RATE IS ONLY REQUIRED FOR
FISCAL YEARS BEGINNING AFTER SEPTEMBER 1, 1995.
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
</FN>
</TABLE>
49
<PAGE>
FINANCIAL HIGHLIGHTS
- -------------------------------------------------------------------------------
For a Share Outstanding Throughout the Period or Year
<TABLE>
<CAPTION>
NET
ASSET DISTRIBUTIONS DISTRIBUTIONS REALIZED AND NET NET
VALUE, NET FROM NET FROM UNREALIZED ASSET VALUE, ASSETS, END
BEGINNING INVESTMENT INVESTMENT CAPITAL GAINS (LOSSES) END TOTAL OF PERIOD
OF PERIOD INCOME INCOME GAINS ON INVESTMENTS OF PERIOD RETURN+ (000)
--------- ---------- ------------- ------------- -------------- ------------ ------- -----------
SHORT TERM
MUNICIPAL
BOND FUND
==========
INSTITUTIONAL CLASS:
For the years ended
<S> <C> <C> <C> <C> <C> <C> <C> <C>
January 31, 1998 $10.08 0.37 (0.38) (0.07) 0.05 $10.05 4.38% $15,626
January 31, 1997 $10.23 0.39 (0.39) (0.07) (0.08) $10.08 3.03% $21,846
January 31, 1996 $10.01 0.43 (0.42) (0.05) 0.26 $10.23 6.71% $31,304
For the period ended
January 31, 1995(1)** $10.00 0.03 (0.03) -- 0.01 $10.01 0.43%* $33,682
RETAIL CLASS A:
For the years ended
January 31, 1998 $10.10 0.35 (0.35) (0.07) 0.05 $10.08 4.08% $ 223
January 31, 1997 $10.25 0.36 (0.36) (0.07) (0.08) $10.10 2.76% $ 228
For the period ended
January 31, 1996(2)** $10.01 0.33 (0.33) (0.05) 0.29 $10.25 6.99%* $ 212
IDAHO MUNICIPAL
BOND FUND
===============
INSTITUTIONAL CLASS:
For the years ended
January 31, 1998 $10.41 0.47 (0.47) (0.04) 0.45 $10.82 9.06% $26,093
January 31, 1997 $10.80 0.46 (0.46) (0.06) (0.33) $10.41 1.31% $27,487
January 31, 1996 $10.13 0.52 (0.51) (0.12) 0.78 $10.80 12.68% $25,873
For the period ended
January 31, 1995(1)** $10.00 0.04 (0.04) -- 0.13 $10.13 1.74%* $25,894
RETAIL CLASS A:
For the years ended
January 31, 1998 $10.44 0.45 (0.45) (0.04) 0.45 $10.85 8.84% $ 9,281
January 31, 1997 $10.83 0.44 (0.44) (0.06) (0.33) $10.44 1.05% $ 5,475
For the period ended
January 31, 1996(2)** $10.21 0.41 (0.40) (0.12) 0.73 $10.83 12.60%* $ 3,109
MUNICIPAL
BOND FUND
=========
INSTITUTIONAL CLASS:
For the year ended
January 31, 1998 $10.02 0.48 (0.48) (0.12) 0.48 $10.38 9.90% $63,028
For the period ended
January 31, 1997(3)** $10.00 0.12 (0.12) -- 0.02 $10.02 1.34%* $53,067
RETAIL CLASS A:
For the year ended
January 31, 1998 $10.01 0.46 (0.46) (0.12) 0.49 $10.38 9.78% $ 9,943
For the period ended
January 31, 1997(4)** $10.01 0.15 (0.15) -- -- $10.01 1.48%* $ 4,895
</TABLE>
<TABLE>
<CAPTION>
RATIO RATIO OF
OF EXPENSES NET INCOME
RATIO TO AVERAGE RATIO OF TO AVERAGE
OF EXPENSES NET ASSETS NET INCOME NET ASSETS PORTFOLIO
TO AVERAGE (EXCLUDING TO AVERAGE (EXCLUDING TURNOVER
NET ASSETS WAIVERS) NET ASSETS WAIVERS) RATE
----------- ----------- ----------- ---------- ---------
SHORT TERM
MUNICIPAL
BOND FUND
==========
INSTITUTIONAL CLASS:
For the years ended
<S> <C> <C> <C> <C> <C>
January 31, 1998 0.75% 1.34% 3.74% 3.15% 64.76%
January 31, 1997 0.75% 1.26% 3.79% 3.28% 41.11%
January 31, 1996 0.75% 1.30% 3.88% 3.33% 114.09%
For the period ended
January 31, 1995(1)** 0.75% 1.26% 3.67% 3.16% 11.80%
RETAIL CLASS A:
For the years ended
January 31, 1998 1.00% 1.59% 3.49% 2.90% 64.76%
January 31, 1997 1.00% 1.51% 3.56% 3.05% 41.11%
For the period ended
January 31, 1996(2)** 1.00% 1.54% 3.49% 2.95% 114.09%
IDAHO MUNICIPAL
BOND FUND
===============
INSTITUTIONAL CLASS:
For the years ended
January 31, 1998 0.75% 1.10% 4.47% 4.12% 17.64%
January 31, 1997 0.75% 1.24% 4.40% 3.91% 29.13%
January 31, 1996 0.75% 1.35% 4.52% 3.92% 58.94%
For the period ended
January 31, 1995(1)** 0.75% 1.38% 4.21% 3.58% 5.66%
RETAIL CLASS A:
For the years ended
January 31, 1998 1.00% 1.37% 4.22% 3.85% 17.64%
January 31, 1997 1.00% 1.47% 4.15% 3.68% 29.13%
For the period ended
January 31, 1996(2)** 1.00% 1.58% 4.18% 3.60% 58.94%
MUNICIPAL
BOND FUND
=========
INSTITUTIONAL CLASS:
For the year ended
January 31, 1998 0.75% 1.05% 4.72% 4.42% 93.18%
For the period ended
January 31, 1997(3)** 0.75% 1.07% 4.58% 4.26% 19.21%
RETAIL CLASS A:
For the year ended
January 31, 1998 1.00% 1.32% 4.48% 4.16% 93.18%
For the period ended
January 31, 1997(4)** 1.00% 1.29% 4.35% 4.06% 19.21%
<FN>
* RETURNS ARE FOR THE PERIOD INDICATED AND HAVE NOT BEEN ANNUALIZED.
** RATIOS FOR THE PERIOD HAVE BEEN ANNUALIZED.
+ RETURNS DO NOT REFLECT ANY SALES LOAD THAT MAY BE APPLICABLE.
(1) COMMENCED OPERATIONS ON DECEMBER 28, 1994.
(2) COMMENCED OPERATIONS ON MARCH 6, 1995.
(3) COMMENCED OPERATIONS ON NOVEMBER 1, 1996.
(4) COMMENCED OPERATIONS ON NOVEMBER 4, 1996.
(5) AVERAGE COMMISSION RATE PAID PER SHARE FOR SECURITY PURCHASES AND
SALES DURING THE PERIOD. PRESENTATION OF THE RATE IS ONLY REQUIRED FOR
FISCAL YEARS BEGINNING AFTER SEPTEMBER 1, 1995.
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
</FN>
</TABLE>
50
<PAGE>
JANUARY 31, 1998 THE ACHIEVEMENT FUNDS TRUST
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION
===============================================================================
The Achievement Funds Trust (the "Trust"), formerly the FSB Funds, was
organized as an unincorporated business trust under the laws of the Commonwealth
of Massachusetts pursuant to a Master Trust Agreement dated December 16, 1988,
which agreement was amended and restated on October 7, 1994 and further amended
on December 1, 1994.
The Trust is registered under the Investment Company Act of 1940, as
amended, as an open-end, management investment company. The Trust presently
consists of a series of seven funds (the "Funds") which includes the Equity
Fund and the Balanced Fund (the "Stock Funds") and the Intermediate Term Bond
Fund, the Short Term Bond Fund, the Short Term Municipal Bond Fund, the Idaho
Municipal Bond Fund and the Municipal Bond Fund (the "Bond Funds"). The Funds'
prospectuses provide a description of each Fund's investment objective,
policies and strategies. The Trust is registered to offer two classes of
shares, Institutional and Retail Class A. The Trust's declaration of trust
permits the Board of Trustees to create additional funds in the future. The
assets of each Fund are segregated, and a shareholder's interest is limited to
the Fund in which shares are held.
2. SIGNIFICANT ACCOUNTING POLICIES
===============================================================================
The following is a summary of significant accounting policies followed by
the Funds.
SECURITY VALUATION -- Investments in equity securities that are traded on a
national securities exchange (or reported on the NASDAQ national market system)
are stated at the last quoted sales price, if readily available for such equity
securities on each business day; other equity securities traded in the
over-the-counter market and listed equity securities for which no sale was
reported on that date are stated at the last quoted bid price. Option contracts
are valued at the last quoted bid price as quoted on the primary exchange or
board of trade on which such option contracts are stated. Debt obligations
exceeding sixty days to maturity for which market quotations are readily
available are valued at the most recently quoted bid price. Debt obligations
with sixty days or less remaining until maturity may be valued at their
amortized cost. Restricted securities for which quotations are not readily
available are valued at fair value using methods approved by the Board of
Trustees.
SECURITY TRANSACTIONS AND INVESTMENT INCOME -- Security transactions are
accounted for on the trade date of the security purchase or sale. For the Equity
Fund, the Balanced Fund, the Intermediate Term Bond Fund and the Short Term Bond
Fund, costs used in determining net realized capital gains and losses on the
sale of securities are those of the specific securities sold, adjusted for the
accretion of the purchase discounts during the respective holding period, which
is calculated using the effective interest method. For the Short Term Municipal
Bond Fund, the Idaho Municipal Bond Fund and the Municipal Bond Fund, costs used
in determining net realized capital gains and losses on the sale of securities
are those of the specific securities sold, adjusted for the accretion and
amortization of the purchase discounts and premiums during the respective
holding period, which is calculated using the effective interest method.
Interest income is recorded on the accrual basis. Dividend income is recorded on
ex-date.
(CONTINUED)
51
<PAGE>
JANUARY 31, 1998
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
OPTIONS TRANSACTIONS -- In order to produce incremental earnings, protect gains,
and facilitate buying and selling of securities for investment purposes, the
Equity Fund and the Balanced Fund may write covered call options. A risk in
writing a call option is that the Fund gives up the opportunity of profit if the
market price of the underlying security increases. The Fund realizes a gain upon
the expiration of a written call option. When a written call option is closed
prior to expiration by being exercised, the proceeds of the sale are increased
by the amount of original premium received.
EXPENSES -- Expenses that are directly related to one of the Funds are charged
directly to that Fund. Other operating expenses of the Trust are prorated to the
Funds on the basis of relative net assets. Class specific expenses, such as
12b-1 fees, are borne by that class. Income, other expenses and accumulated
realized and unrealized gains and losses of a Fund are allocated to the
respective class on the basis of the relative net assets each day.
MANAGEMENT ESTIMATES -- The preparation of financial statements in accordance
with generally accepted accounting principles requires management to make
certain estimates and assumptions that may affect the reported amounts and
disclosures in the financial statements. Actual results could differ from those
estimates.
DISTRIBUTIONS TO SHAREHOLDERS -- Distributions from net investment income are
declared and paid on a quarterly basis for the Equity Fund. The Balanced Fund
declares and pays its dividend on a monthly basis. The Bond Funds declare
dividends on a daily basis and pay them on the first business day of the
following month. Any net realized capital gains on sales of securities for a
Fund are distributed to its shareholders at least annually.
Income distributions and capital gain distributions are determined in
accordance with U.S. federal income tax regulations, which may differ from
generally accepted accounting principles. These book/tax differences are either
temporary or permanent in nature. To the extent these differences are permanent,
they are reclassified for book purposes. As of January 31, 1998, $11,618 has
been reclassified in the Equity Fund from undistributed net investment income to
accumulated net realized gain. This reclassification has no effect on net assets
or net assets per share.
FEDERAL INCOME TAXES -- It is the Trust's intention to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Accordingly, no provision for Federal income taxes is required in the financial
statements.
ORGANIZATION COSTS -- Organizational costs have been capitalized by the Funds
and are being amortized over sixty months commencing with operations. In the
event any of the initial shares of a Fund are redeemed by any holder thereof
during the period that the Fund is amortizing its organizational costs, the
redemption proceeds payable to the holder thereof by the Fund will be reduced by
the unamortized organizational costs in the same ratio as the number of initial
shares being redeemed bears to the number of initial shares outstanding at the
time of redemption.
52
<PAGE>
THE ACHIEVEMENT FUNDS TRUST
3. INVESTMENT ADVISORY AND CUSTODIAL SERVICES
===============================================================================
Pursuant to an investment advisory agreement dated December 27, 1994, as
amended, investment advisory services are provided to the Funds by First
Security Investment Management, Inc. (the "Adviser"). The Adviser is entitled to
receive an annual fee of 0.74% of the average daily net assets of the Stock
Funds and 0.60% of the average daily net assets of the Bond Funds. Such fee is
computed daily and paid monthly. During the year ended January 31, 1998, the
Adviser voluntarily waived a portion of its fees in order to limit operating
expenses.
The Trust and CoreStates Bank (the "Custodian") are parties to a custodial
agreement dated December 27, 1994, under which the Custodian holds cash,
securities and other assets of the Trust, as required by the Investment Company
Act of 1940. In its capacity as custodian to the Trust, the Custodian plays no
role in determining the investment policies of the Trust or which securities are
to be purchased or sold by the Funds.
4. ADMINISTRATIVE, TRANSFER AGENT AND DISTRIBUTION SERVICES
===============================================================================
Pursuant to an administrative agreement dated December 27, 1994, SEI Fund
Resources ("SFR") acts as the Trust's Administrator. Under the terms of such an
agreement, SFR is entitled to receive an annual fee of 0.20% of the average
daily net assets of the Equity Fund, Balanced Fund, Intermediate Term Bond Fund,
Short Term Bond Fund and the Municipal Bond Fund. The Administrator is entitled
to a fee from the Short Term Municipal Bond Fund and the Idaho Municipal Bond
Fund in an amount equal to the greater of 0.20% of their daily net assets or
$100,000 per annum. The Administrator has voluntarily agreed to waive a portion
of its fee for the year ended January 31, 1998 for the Short Term Municipal Bond
Fund and the Idaho Municipal Bond Fund in order to limit operating expenses.
Pursuant to an agreement dated December 27, 1994, DST Systems, Inc. ("DST")
acts as the Transfer Agent of the Trust. As such, DST provides transfer agency,
dividend disbursing, shareholder servicing and administrative services for the
Trust.
SEI Investments Distribution Co. (the "Distributor"), a wholly owned
subsidiary of SEI Investments Company, acts as the Trust's Distributor pursuant
to a distribution agreement dated December 27, 1994. The Distributor receives no
fee for its services in connection with distribution of the Institutional
shares. The Trust has adopted a Distribution Plan (the "Plan") on behalf of the
Retail Class A shares pursuant to Rule 12b-1 under the Investment Company Act of
1940. The Plan provides for the payment by the Trust to the Distributor of up to
.25% of the average daily net assets of the Retail Class A shares.
Certain officers of the Trust are also officers of the Administrator. Such
officers are paid no fees by the Trust.
(CONTINUED)
53
<PAGE>
JANUARY 31, 1998
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
5. INVESTMENT TRANSACTIONS
===============================================================================
The cost of security purchases and the proceeds from the sale of
securities, other than short-term investments for the year ended January 31,
1998, are presented below for the Funds. On January 31, 1998 the total cost of
securities and the net realized gains and losses on securities sold for federal
income tax purposes was not materially different from amounts reported for
financial reporting purposes. The aggregate gross unrealized gain or loss on
securities at January 31, 1998 for each Fund is as follows:
FUND INVESTMENT TRANSACTIONS (000)
<TABLE>
<CAPTION>
SHORT TERM IDAHO
INTERMEDIATE SHORT MUNICIPAL MUNICIPAL MUNICIPAL
EQUITY BALANCED TERM BOND TERM BOND BOND BOND BOND
FUND FUND FUND FUND FUND FUND FUND
========= ======== ============ ========= ========== ========= =========
Purchases
<S> <C> <C> <C> <C> <C> <C> <C>
U.S. Government
Securities $ -- $ 3,493 $25,400 $12,010 $ -- $ -- $ --
Other 69,134 46,101 21,678 14,116 12,324 8,178 71,254
Sales
U.S. Government
Securities -- 7,129 24,212 16,124 -- -- --
Other 78,775 50,535 5,191 25,998 18,366 5,878 60,557
Aggregate gross
unrealized gain 56,310 35,597 4,233 294 173 1,783 2,285
Aggregate gross
unrealized loss (2,014) (1,091) (329) (80) (23) -- (45)
-------- ------- ------- ------- ------- ------- -------
Net unrealized gain $ 54,296 $34,506 $ 3,904 $ 214 $ 150 $ 1,783 $ 2,240
======== ======= ======= ======= ======= ======= =======
</TABLE>
At January 31, 1998, the Intermediate Term Bond Fund and the Short Term
Bond Fund had capital loss carryforwards for federal tax purposes. The losses in
the Funds can be carried forward for a maximum of eight years to offset any net
realized capital gains. Such capital loss carryforwards will expire as listed
below:
INTERMEDIATE SHORT
TERM BOND TERM BOND
FUND FUND
============ ==========
Carryforwards to Expire in 2004 $1,567,931 $2,034,615
Carryforwards to Expire in 2005 519,195 8,234
Carryforwards to Expire in 2006 468,346 226,204
54
<PAGE>
THE ACHIEVEMENT FUNDS TRUST
6. CONCENTRATION OF CREDIT RISK
===============================================================================
The Short Term Municipal Bond Fund, the Idaho Municipal Bond Fund and the
Municipal Bond Fund invest in debt instruments of municipal issuers. The
issuer's ability to meet their obligations may be affected by economic
developments in a specific state or region. The Idaho Municipal Bond Fund
invests primarily in obligations of municipalities located in Idaho. The Short
Term Municipal Bond Fund, the Idaho Municipal Bond Fund and the Municipal Bond
Fund invest in securities which include revenue bonds, tax exempt commercial
paper, tax and revenue anticipation notes, and general obligation bonds. At
January 31, 1998, the percentage of total value of investments by each revenue
source was as follows:
SHORT TERM IDAHO
MUNICIPAL MUNICIPAL MUNICIPAL
BOND FUND BOND FUND BOND FUND
========== ========= =========
Cash Equivalents 1% 2% 1%
Education Bonds 17% 5% 11%
General Obligation 46% 71% 18%
Hospital Bonds 13% 4% 13%
Housing Bonds 4% 4% 28%
Public Facility Bonds 4% 3% 3%
Other Revenue Bonds 7% 5% 13%
Transportation Bonds 3% 3% 4%
Utility Bonds 5% 3% 9%
------ ------ ------
100% 100% 100%
====== ====== ======
(CONTINUED)
55
<PAGE>
JANUARY 31, 1998
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
Many municipalities insure their obligations with insurance underwritten by
insurance companies that undertake to pay a holder, when due, the interest and
principal amount on an obligation if the issuer defaults on its obligation.
Although bond insurance reduces the risk of loss due to default by the issuer,
there is no assurance that the insurance company will meet its obligations.
Also, some of the securities have credit enhancements (letters of credit or
guarantees issued by third party domestic or foreign banks or other
institutions). At January 31, 1998, 55%, 68% and 44% of the total value of the
Short Term Municipal Bond Fund, Idaho Municipal Bond Fund and the Municipal Bond
Fund, respectively, were insured or had credit enhancements.
The ratings of debt holdings by Standard & Poor's or Moody's as a
percentage of total value of investments at January 31, 1998 are as follows:
<TABLE>
<CAPTION>
IDAHO
SHORT TERM MUNICIPAL MUNICIPAL
INTERMEDIATE TERM SHORT TERM MUNICIPAL BOND BOND BOND
BOND FUND BOND FUND FUND FUND FUND
================= ========== ============== ========= =========
<S> <C> <C> <C> <C> <C>
AAA 65% 36% 56% 67% 38%
AA+ -- -- 7% -- 6%
AA 3% -- 5% 11% 23%
AA- 4% 6% 11% 6% 2%
A+ 4% 27% -- 2% 2%
A 12% 19% 4% 11% 5%
A- 4% 10% 4% 3% 5%
BBB+ 5% 2% -- -- 6%
BBB 3% -- 3% -- 7%
BBB- -- -- 2% -- 2%
Not rated -- -- 8% -- 4%
---- ---- ---- ---- ----
100% 100% 100% 100% 100%
==== ==== ==== ==== ====
</TABLE>
7. LINE OF CREDIT
===============================================================================
Pursuant to a credit agreement dated October 9, 1997, as amended, Morgan
Guaranty Trust Company of New York provides revolving credit loans to the Funds
for short-term or emergency purposes, such as funding shareholder redemptions.
These loans are for the respective benefit of and repayable from the respective
assets of the Funds. The aggregate principal amount over all Funds in the Trust
may not exceed $10,000,000. The aggregate amount of all loans outstanding to an
individual Fund shall not exceed 5% of the total net assets of that Fund. As of
January 31, 1998, none of the Funds had loans outstanding. For the period ended
January 31, 1998, the maximum amount borrowed was $2,500,000, the average
outstanding was $41,989, and the daily weighted average interest rate was 8.50%.
56
<PAGE>
THE ACHIEVEMENT FUNDS TRUST
INDEPENDENT AUDITORS' REPORT
The Shareholders and Board of Trustees of the Achievement Funds Trust:
We have audited the accompanying statements of net assets of The Achievement
Funds Trust (the "Trust"), including the Equity Fund, the Balanced Fund, the
Intermediate Term Bond Fund, the Short Term Bond Fund, the Short Term Municipal
Bond Fund, the Idaho Municipal Bond Fund and the Municipal Bond Fund as of
January 31, 1998, the related statements of operations for the year then ended,
changes in net assets and the financial highlights for the periods presented.
These financial statements and the financial highlights are the responsibility
of the Trust'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 audits to obtain
reasonable assurance about whether the financial statements and the 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
January 31, 1998 by correspondence with the custodian and brokers. 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, such financial statements and financial highlights present
fairly, in all material respects, the financial position of The Achievement
Funds Trust as of January 31, 1998, the results of their operations, the changes
in their net assets, and the financial highlights for the respective stated
periods in conformity with generally accepted accounting principles.
Deloitte & Touche LLP
Princeton, New Jersey
March 20, 1998
57
<PAGE>
NOTICE TO SHAREHOLDERS
(UNAUDITED)
For shareholders that do not have a January 31, 1998 tax year end, this
notice is for informational purposes only. For shareholders with a January 31,
1998 tax year-end, please consult your tax adviser as to the pertinence of this
notice.
For the fiscal year ended January 31, 1998, each fund is designating
the following items with regard to distributions paid during the year.
<TABLE>
<CAPTION>
LONG-TERM MID-TERM ORDINARY
CAPITAL GAIN CAPITAL GAIN INCOME
FUND DISTRIBUTION DISTRIBUTION DISTRIBUTION
- --------------------------------------- -------------- ------------ ------------
<S> <C> <C> <C>
Equity Fund 16.12% 31.00% 52.88%
Balanced Fund 24.38% 16.68% 58.94%
Intermediate Term Bond Fund 0.00% 0.00% 100.00%
Short Term Bond Fund 0.00% 0.00% 100.00%
Short Term Municipal Bond Fund 2.65% 10.81% 2.49%
Idaho Municipal Bond Fund 1.31% 6.00% 0.30%
Municipal Bond Fund 14.90% 0.14% 7.12%
TAX EXEMPT
INCOME QUALIFYING
FUND DISTRIBUTION TOTAL DIVIDENDS(1)
- --------------------------------------- ------------ ----- ------------
Equity Fund 0.00% 100% 59.32%
Balanced Fund 0.00% 100% 17.75%
Intermediate Term Bond Fund 0.00% 100% 0.00%
Short Term Bond Fund 0.00% 100% 0.00%
Short Term Municipal Bond Fund 84.05% 100% 0.00%
Idaho Municipal Bond Fund 92.39% 100% 0.00%
Municipal Bond Fund 77.84% 100% 0.00%
</TABLE>
(1) Qualifying dividends represent dividends which qualify for the corporate
dividends received deduction.
None of the Funds qualify in California, Connecticut, or New York to pass
through exempt interest dividends from U.S. government obligations.
None of the Funds qualify for Foreign Tax Credit.
58
<PAGE>
NOTES
59
<PAGE>
NOTES
60
<PAGE>
------------------------------------------
The Achievement Funds
BOARD OF TRUSTEES
Frederick A. Moreton, Jr.
Robert G. Love
August Glissmeyer, Jr.
Carl S. Minden
George L. Denton, Jr.
Kent H. Murdock
James H. Gardner
Blaine Huntsman
INVESTMENT ADVISER
First Security Investment Management, Inc.
Salt Lake City, UT 84111
ADMINISTRATOR
SEI Fund Resources
Oaks, PA 19456
DISTRIBUTOR
SEI Investment Distribution Co.
Oaks, PA 19456
LEGAL COUNSEL
Ballard Spahr Andrews & Ingersoll
Philadelphia, PA 19103
INDEPENDENT ACCOUNTANTS
Deloitte & Touche LLP
Princeton, NJ 08540
CUSTODIAN
CoreStates Bank, N.A.
Philadelphia, PA 19101
<PAGE>
[LOGO OMITTED]
THE ACHIEVEMENT FUNDS For Your Life's Journey
Shares of any of The Achievement Funds are:
[BULLET] not obligations or deposits of, or guaranteed by First Security
Corporation or any of its banks or non-bank subsidiaries;
[BULLET] not federally insured by the FDIC, the Federal Reserve Board or any
other government agency;
[BULLET] subject to investment risk, including the possible loss of principal.
This report and the financial statements contained herein are submitted for the
general information of the shareholders of the Funds. This report is not
authorized for distribution to prospective investors in a Fund unless preceded
or accompanied by a current prospectus.
FOR MORE INFORMATION, INCLUDING A PROSPECTUS,
CALL 1-800-472-0577.
ACH-F-014-04
