[LOGO OMITTED]
THE
ACHIEVEMENT
FUNDS(R)
FOR YOUR LIFE'S JOURNEY(R)
[COVER GRAPHIC OMITTED] MOUNTAIN SCENE
ANNUAL
REPORT TO SHAREHOLDERS
- ----------------------
JANUARY 31, 1999
<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 ....... 52
- ---------------------
The Achievement Funds
Annual Report
JANUARY 31, 1999
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(R)
FOR YOUR LIFE'S JOURNEY(R)
<PAGE>
- --------------------------------------------------------------------------------
Letter to Shareholders
[GRAPHIC OMITTED]
FREDERICK A. MORETON, JR. JOHN L. RUDISILL
Chairman Manager
IT WOULD APPEAR THAT A MAJOR THEME IN 1998 WAS ONE OF UNCERTAINTY - NOT ONLY
WITH REGARD TO THE U.S. MARKETS, BUT ALSO FROM A GLOBAL PERSPECTIVE. A NATURAL
REACTION TO THIS OVERALL STATE OF UNCERTAINTY IS TO QUESTION THE FUNDAMENTAL
PRINCIPLES WHICH MANY BELIEVE HAVE FUELED THE U.S. ECONOMY OVER THE LAST SEVERAL
YEARS. DURING 1998, EVERYTHING FROM CUSTOMER SPENDING AND OVERALL CONFIDENCE TO
MONETARY POLICY, AS GOVERNED BY THE FED, TO SUCH ISSUES AS YEAR 2000 COMPUTER
CONCERNS AND THE HONESTY AND INTEGRITY OF OUR ELECTED GOVERNMENT OFFICIALS HAS
COME UNDER CLOSE EXAMINATION. IT SEEMS TO HAVE BEEN A YEAR OF RE-EXAMINATION AND
RE-VALIDATING OUR BELIEFS IN THE STRENGTH OF THE U.S. ECONOMY AND THE DIRECTION
OF THE STOCK MARKET. AS WE SIT AT THE DOORSTEP OF A DOW JONES INDUSTRIAL AVERAGE
LEVEL OF 10000 (AT LEAST AT THIS WRITING), THE UNCERTAINTY CONTINUES. HOWEVER,
THE VOLATILITY OF 1998 ALSO PROVIDED AN OPPORTUNITY FOR THE BOARD OF TRUSTEES OF
THE ACHIEVEMENT FUNDS AND OUR INVESTMENT ADVISER, FIRST SECURITY INVESTMENT
MANAGEMENT, INC. TO TEST OUR CORE INVESTMENT PHILOSOPHY UNDER A VARIETY OF
MARKET CONDITIONS. AS DISCUSSED IN THE ACCOMPANYING INVESTMENT ADVISER'S REPORT,
STERLING K. JENSON AND HIS TEAM OF PROFESSIONALS PROVIDED ANOTHER YEAR OF SOLID
RETURNS FOR OUR SHAREHOLDERS. WE CONTINUE TO LOOK TOWARD REASONABLE RETURNS OVER
THE LONG RUN, AT ACCEPTABLE RISK LEVELS RATHER THAN REACTING SOLELY TO
SHORT-TERM MARKET TRENDS. THIS PHILOSOPHY AGAIN SERVED US WELL IN 1998.
YOU WILL NOTE IN THE ACCOMPANYING MATERIALS THAT WE WERE SUCCESSFUL IN
INTRODUCING A NEW RETAIL CLASS B SHARE FOR SEVERAL OF OUR FUNDS DURING 1998.
THIS CLASS B OFFERING HAS GENERATED NEW INTEREST IN THE ACHIEVEMENT FUNDS BY A
SEGMENT OF OUR RETAIL MARKET WHO SEEK PROFESSIONAL INVESTMENT ADVICE WITHOUT
PAYING A FRONT END LOAD FEE.
1
<PAGE>
WE ARE CURRENTLY IN THE PROCESS OF BUILDING THE ACHIEVEMENT FUND'S WEB SITE AND
HOPE TO HAVE IT COMPLETED BY MID 1999. WE ARE VERY EXCITED ABOUT THIS PROJECT AS
IT WILL GIVE OUR CURRENT SHAREHOLDERS AROUND THE CLOCK ACCESS TO CURRENT FUND
AND ACCOUNT LEVEL INFORMATION AND WILL GIVE PROSPECTIVE INVESTORS VALUABLE
INFORMATION ABOUT OUR FUND FAMILY.
AS ALWAYS, WE APPRECIATE YOU, OUR FELLOW SHAREHOLDERS, AND WELCOME YOUR COMMENTS
AND QUESTIONS. YOU CAN REACH OUR SHAREHOLDER SERVICES PERSONNEL BY CALLING 1
(800) 472-0577 OR CONTACT YOUR FINANCIAL ADVISER.
/s/ signature omitted
FREDERICK A. MORETON, JR.
CHAIRMAN OF THE BOARD OF TRUSTEES
The Achievement Funds Trust
/s/ signature omitted
JOHN L. RUDISILL
SENIOR VICE PRESIDENT AND MANAGER
Mutual Fund Center
First Security Corporation
MARCH 12, 1999
2
<PAGE>
THE ACHIEVEMENT FUNDS
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FUND OBJECTIVES
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, 1999
<TABLE>
- ----------------------------------------------------------------------------------------------------------------------------
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 1/31/98 1/31/99 SEC Yield Per Share
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Institutional $270,397 24.70% 24.06% $15.34 $18.03 -- $0.79
EQUITY Retail Class A 12,064 24.09 23.64 15.34 18.01 -- 0.75
FUND Retail Class B 2,185 10.97* 10.97* 17.26** 17.93 -- 0.73
- ----------------------------------------------------------------------------------------------------------------------------
Institutional $214,939 17.61% 16.75% $13.10 $13.99 1.33% $1.15
BALANCED Retail Class A 4,339 17.04 16.50 13.08 13.97 1.04 1.12
FUND Retail Class B 1,481 7.99* 7.99* 14.09** 13.95 0.37 0.98
- ----------------------------------------------------------------------------------------------------------------------------
INTERMEDIATE Institutional $168,545 8.08% 7.25% $10.63 $10.77 4.68% $0.61
TERMBONDFUND Retail Class A 1,743 7.48 6.91 10.66 10.79 4.27 0.59
- ----------------------------------------------------------------------------------------------------------------------------
SHORTTERM Institutional $37,951 6.00% 5.33% $10.05 $10.02 4.73% $0.55
BONDFUND Retail Class A 148 5.59 4.94 10.04 10.00 4.41 0.53
- ----------------------------------------------------------------------------------------------------------------------------
SHORTTERM
MUNICIPAL Institutional $4,816 4.34% 3.26% $10.05 $ 9.98 3.18% $0.40
BONDFUND Retail Class A 481 4.17 3.18 10.08 10.02 2.90 0.37
- ----------------------------------------------------------------------------------------------------------------------------
Institutional $26,961 7.40% 5.76% $10.82 $10.91 4.03% $0.52
IDAHOMUNICIPAL Retail Class A 11,695 6.76 5.43 10.85 10.93 3.61 0.50
BONDFUND Retail Class B 1,346 5.37* 5.37* 10.69** 10.94 3.04 0.32
- ----------------------------------------------------------------------------------------------------------------------------
Institutional $68,239 7.60% 5.88% $10.38 $10.30 4.71% $0.67
MUNICIPAL Retail Class A 7,226 7.47 5.48 10.38 10.29 4.29 0.65
BONDFUND Retail Class B 2,235 4.87* 4.87* 10.27** 10.30 3.72 0.47
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
THE ACHIEVEMENT FUNDS TOTAL RETURN ANNUALIZED SINCE INCEPTION
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Equity Fund Institutional (12/28/94) 24.70%
Retail Class A (3/6/95) 24.09%
Retail Class B* (5/8/98) 10.97%
- ----------------------------------------------------------------------------------------------------------------------------
Balanced Fund Institutional (12/28/94) 17.61%
Retail Class A (3/6/95) 17.04%
Retail Class B* (5/8/98) 7.99%
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Intermediate Term Institutional (12/28/94) 8.08%
Bond Fund Retail Class A (3/6/95) 7.48%
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Short Term Bond Fund Institutional (12/28/94) 6.00%
Retail Class A (3/6/95) 5.59%
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Short Term Municipal Institutional (12/28/94) 4.34%
Bond Fund Retail Class A (3/6/95) 4.17%
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Idaho Municipal Institutional (12/28/94) 7.40%
Bond Fund Retail Class A (3/6/95) 6.76%
Retail Class B* (5/8/98) 5.37%
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Municipal Bond Fund Institutional (11/1/96) 7.60%
Retail Class A (11/4/96) 7.47%
Retail Class B* (5/8/98) 4.87%
0 5 10 15 20 25 30
Percent (%)
</TABLE>
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.
*CUMULATIVE INCEPTION TO DATE. **NAV ON INCEPTION DATE, 5/8/98
4
<PAGE>
THE ACHIEVEMENT FUNDS
INVESTMENT ADVISER'S REPORT
[GRAPHIC OMITTED]
STERLING K. JENSON
Led by the phenomenal, sky-rocketing internet stocks, the market pulled out of
its cataclysmic crash in late August and early October to post a fourth year of
stellar investment returns. By many measures the past year was the most volatile
since 1987, the year of the crash. As recently as October, stocks seemed headed
for a bear market. But then, the Federal Reserve pushed money into the economy
by lowering interest rates and a small group of big stocks posted explosive
gains, propelling the big stock indexes to a record-setting fourth straight year
of strong gains. Many less popular stocks continued to trail.
The more exposure one had to internet and high technology stocks, the greater
the performance. For example, the Standard & Poor's 500 Index far outpaced the
Dow Industrials due to high-octane technology names like Microsoft, Intel, and
Dell Computer.
For most long-term market watchers, the most worrisome aspect of the 1998 gains
was the concentration in such a narrow group of stocks. Many of the
less-prominent issues were left behind. Despite its own late-year gains, the
Russell 2000 Index of small stocks still finished down for the year.
Investors who use traditional valuation techniques often missed the big gains
which came in stocks that looked vastly over priced. Having a good memory and a
sound background have been disadvantages in terms of performance. When you find
that America Online (AOL) now has a higher market value than American Home
Products or Abbott Labs it can be disturbing.
Throughout last year, investors worried about every imaginable trouble: sagging
Asian economies, inflation driving up interest rates, then deflation leading to
recession, Russia defaulting on its debt and devaluing the Ruble, impeachment
proceedings, Year 2000 computer problems, Japanese banking troubles, weather
patterns, Iraqi bombings, and the Brazilian bailout by the International
Monetary Fund. The big unknown for 1999 is what we should worry about next.
Even bonds shed their reputation for safety and security. For the first time
since 1990, safe bonds roundly trounced risky bonds last year, amid falling
interest rates, low inflation and a late-summer flight from bonds with any risk
attached to them.
STOCK MARKET OUTLOOK FOR 1999
- --------------------------------------------------------------------------------
Many analysts of the market are convinced there is really no way stocks can
sparkle yet another year. The wall-of-worry that must be climbed appears huge.
Valuation levels based on revenues, earnings, or book value are at record
levels; the S&P 500 is trading at over 29 times 1999 earnings estimates, up from
last year's 19 times earnings level.
Some say that public expectations are astronomical with respect to returns from
stocks and that this priming over several years has set us up for a significant
bearish experience.
5
<PAGE>
S&P 500 Index
[GRAPHIC OMITTED]
Plot points are as follows:
S&P 500
1/31/98 920.28
4/30/98 1,111.75
7/31/98 1,120.67
10/31/98 1,098.67
1/31/99 1,279.64
FACTORS INFLUENCING A CONTINUATION OF THE BULL MARKET
In spite of these rational reasons for investor skittishness, we remain
optimistic for the coming year. I would like to highlight four factors that
should keep the positive direction intact.
1. LOW INFLATION AND INTEREST RATES.
Starting in September we had three interest rate cuts; Greenspan's gift to the
markets to avoid a financial meltdown. The drop of over one percent in interest
rates over the past year has been the major tonic for the market's rise in the
face of slowing corporate profits. The rise in the price-to-earnings ratio has
been a direct cause-effect of falling rates.
We expect inflation to remain below 2%, helped by excess commodity capacity and
the Internet. The Federal Reserve Board most likely will keep interest rates
constant over the course of the coming year in spite of the strong growth in the
United States, due to overseas weakness.
2. FAVORABLE POLICY ENVIRONMENT.
Since August, the partisan Congress funded the IMF, allowing significant
participation in turning around the weakness in Brazil. The Japanese bureaucracy
surprised consensus thought by implementing banking legislation to stimulate
their economy and by injecting more than 40 trillion yen into the banking
system. Also, the Clinton investigation has ended. The third year of a
presidential term is generally favorable for the market because expectations for
any major, new legislation is usually
[GRAPHIC OMITTED]
Plot points are as follows:
Lehman Aggregate Bond Index
1/31/98 683.4
4/30/98 689.6
7/31/98 703.85
10/31/98 733.42
1/31/99 746.66
low. That is particularly the case with our current President and Congress. The
market loves stalemate in Washington.
3. CORPORATE RESTRUCTURING AND POSITIVE CASH FLOW.
The whole mentality of corporate America is merger and acquisition driven right
now. If you're not consolidating, you're not in the game. Companies are
scrambling to enter lines of business, expand
6
<PAGE>
THE ACHIEVEMENT FUNDS
geographically, plug holes in product lines, or grow by swallowing up smaller,
faster-growing competitors. Mergers and acquisitions worldwide totaled over $2.5
trillion last year. This shrinkage of stocks outstanding and bidding up of
acquired company stock prices will be positive for the markets.
Cash flow into stocks will continue from Baby Boomer 401k investors, safe haven
seekers from overseas, and asset allocation decision makers who view bond and
money market returns as tepid at best.
4. CORPORATE EARNINGS GROWTH.
Consensus expectations are for earnings to continue to slow in a
non-inflationary, slow growth environment. We think that earnings growth may
actually be somewhat better than the 0% to 3% forecasts prevalent today. Despite
much concern over margins, pretax margins in the mid-1960's were more than 300
basis points (3%) higher than the 8.5% level today and inflation 30 years ago
was also 2% or less. Thus, margins can get better in spite of limited pricing.
Earnings for 1998 were significantly impaired by declines in three of the
largest sectors: technology in the first half as inventories were being purged,
financials in the second half due to Russia write-downs and a poor underwriting
calendar, and energy all year because of poor demand.
During 1999 we do not expect financials and technology to experience the profit
hits absorbed in 1998 nor do we look for energy earnings to plunge again by 30%.
Also, a weaker dollar should favorably benefit multinational corporation
earnings. Earnings growth of 7% to 8%, therefore, should provide the fundamental
fuel to take stock prices up.
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
1999 at the 10500 level for a 15% total return. Momentum could actually take the
market to the 11000 level during the year, most likely sometime in the first two
quarters. We expect volatility to remain common place with potential violent
swings in the late summer or early fall period as we witnessed this past year.
SUMMARY
- --------------------------------------------------------------------------------
Following four years of extraordinary returns in the stock market, we at First
Security Investment Management expect 1999 to produce another year of double
digit percentage growth in stock values due to a favorable interest rate and
inflation outlook, a positive fiscal and monetary environment, continued demand
for equity securities, and growing corporate profits.
Bonds should provide favorable returns for the year with range-bound interest
rates; corporate bonds should out perform Treasuries.
\s\ signature omitted
STERLING K. JENSON
PRESIDENT
First Security Investment Management, Inc.
Investment Adviser
March 19, 1999
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 ended January 31, 1999, the Fund's Institutional Class
provided a total return of 24.06%*; since inception on December 28, 1994 it is
up 146.2%. The Dow Jones Industrial Average and S&P 500 Index returned 20.4% and
32.5%, respectively for the year ended January 31, 1999.
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.
Through our proprietary models and analysis we continually search the universe
of stocks for the best managed companies with proven historical records of
earnings growth and future growth potential. We then monitor the companies
continually to be sure expectations are tracking favorably. 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.
The portfolio is diversified with the average weighting per stock at about 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 overweighted in sectors with favorable
earning prospects such as technology, communications, healthcare and consumer
cyclicals. Underweight sectors include basic materials and energy where stocks
are dependent on commodity prices and utilities where earnings growth is low.
*The Retail Class a of the Achievement Equity Fund produced a total return of
23.64%. including the maximum sales charge of 4.50%, the total return of the
fund's Retail Class A was 18.10%. the Retail Class B of the Achievement Equity
Fund produced a cumulative inception to date return of 10.97%. including the
maximum sales charge of 5.00%, the cumulative inception to date return of the
fund's retail class b was 5.97%.
8
<PAGE>
THE ACHIEVEMENT FUNDS
ACHIEVEMENT EQUITY FUND -- INSTITUTIONAL CLASS
[Graphic omitted]
Plot points are as follows:
Achievement Equity Fund,
Institutional Class S&P 500
12/31/94 10,000 10,000
1/31/96 10,291 10,259
1/31/97 13,641 14,221
1/31/98 16,369 17,965
1/31/99 19,993 22,798
1/31/99 24,803 30,210
Average Annual Total Return
One Year Annualized Annualized Inception
Return Three Year Return to Date
- -------------------------------------------------------------------
Institutional 24.06% 22.06% 24.70%
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
ACHIEVEMENT EQUITY FUND -- RETAIL CLASS A & B
[Graphic omitted]
Plot points are as follows:
<TABLE>
Achievement Equity Fund, Achievement Equity Fund,
Retail Class A S&P 500 Retail Class B S&P Composite Index
<S> <C> <C> <C> <C>
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 20,778
5/31/98 10,000 10,000
1/31/99 21,600 27,533 10,871 11,844
</TABLE>
Average Annual Total Return
One Year Annualized Annualized Inception
Return Three Year Return to Date
- ---------------------------------------------------------------------------
RETAIL A 23.64% 21.70% 24.09%
RETAIL A with load 18.10% 19.84% 22.63%
RETAIL B N/A N/A 10.97%
RETAIL B with load N/A N/A 5.97%
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
*CUMULATIVE INCEPTION TO DATE
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 ended January 31, 1999, the Institutional Class of the Fund
produced a total return of 16.75%*. Its benchmark, the weighted average of the
Lehman Intermediate Government/ Corporate Bond Index and the S&P 500 Index, had
a total return of 20.06%.
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 portfolio's bond allocation maintained a slightly longer maturity and
duration than the Lehman Index. With an average bond allocation of 30%, the
longer maturity and duration helped increase the Fund's yield and overall
performance in a year that saw surprisingly good returns 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 stabilize at current levels under this scenario. We expect the growth
rate of earnings to re-accelerate this year as Asia stabilizes and the affect of
three interest rate cuts by the Federal Reserve starts to hit the economy.
Inflation should remain at low levels and allow the stock market another
positive performance year. 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 currently has a maturity and
duration that is slightly longer than the Lehman Index. This is also a result of
our expectation for flat 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 A of the Achievement Balanced Fund produced a total return of
16.50% for the period. Including the maximum sales charge of 4.50%, the total
return of the Fund's Retail Class A was 11.22%. The Retail Class B of the
Achievement Balanced Fund produced a cumulative inception to date return of
7.99%. Including the maximum sales charge of 5.00%, the cumulative inception to
date return of the Fund's Retail Class B was 2.99%.
10
<PAGE>
THE ACHIEVEMENT FUNDS
[Graphic omitted]
Plot points are as follows:
ACHIEVEMENT BALANCED FUND, INSTITUTIONAL CLASS
Achievement Balanced Fund,
Institutional Class S&P 500 Lehman
1/31/94 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 22,798 13,113
1/31/99 19,484 30,210 14,109
Average Annual Total Return
One Year Annualized Annualized Inception
Return Three Year Return to Date
- ------------------------------------------------------------------------
Institutional 16.75% 15.33% 17.61%
Past performance of the Fund is not predictive of future performance.
ACHIEVEMENT BALANCED FUND, RETAIL CLASS A & B
[GRAPHIC OMITTED]
Plot points are as follows:
Achievement Balanced Fund, S&P 500 Lehman Intermediate Gov't
Retail Class A Composite Index Corp 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 20,778 12,562
5/31/98
1/31/99 17,326 27,533 13,517
Achievement Balanced Fund, S&P 500 Lehman Intermediate Gov't
Retail Class B Composite Index Corp Index
3/31/95
1/31/96
1/31/97
1/31/98
5/31/98 10,000 10,000 10,000
1/31/99 10,496 11,844 10,604
Average Annual Total Return
One Year Annualized Annualized Inception
Return Three Year Return to Date
- --------------------------------------------------------------------------
RETAIL A 16.50% 15.05% 17.04%
RETAIL A with load 11.22% 13.29% 15.66%
RETAIL B N/A N/A 7.99%
RETAIL B with load N/A N/A 2.99%
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
*Cumulative inception to date
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 rate
expectations. The Fund should be considered by investors desiring a relatively
stable income-producing investment with managed volatility and investment grade
securities.
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.
The total return for the Institutional Class of the Fund for the fiscal year
ended January 31, 1999 was 7.25%*. The comparative Lehman Intermediate
Government/Corporate Bond Index had a total return of 7.62% for the same period.
U.S. Treasury securities outperformed other fixed income securities during the
period due to a "flight to quality" move by investors. Due to international
economic and yield concerns, investors moved funds from foreign fixed income
securities and from lower credit quality domestic fixed income securities into
the U.S. Treasury market causing prices to increase and yields to decline.
Approximately 54% of the Lehman Index consists of Treasury securities compared
to approximately 35% currently for the Achievement Intermediate Term Bond Fund.
This difference accounted for a large portion of the total return variation.
Volatility in the fixed income markets has been quite high, not only due to
"flight to quality" issues, but also due to investors moving funds in and out of
the equity markets. We expect this pattern to continue in 1999. The 30-year
Treasury is likely to trade in a range of 5.00% to 5.50% through the first half
of the year. We expect that economic growth will slow sufficiently later in the
year to allow interest rates to have a downward bias.
Inflation as measured by the Consumer Price Index in 1998 was a low 1.6%. This
coupled with three Fed Funds rate cuts, totaling 75 basis points (0.75%), has
had the impact of setting the stage for a general reduction in interest rates
across the Treasury Yield Curve by a similar amount for the twelve months ended
January 31, 1999. Interest rates as measured by U.S. Treasury bonds fell from
5.81% to 5.09% for the 30-year bond, from 5.51% to 4.65% for the 10-year bond
and from 5.31% to 4.56% for the two year bond.
Duration and average maturity have been maintained somewhat longer than the
comparative Lehman Intermediate Government/Corporate Bond Index. This position
was a positive influence on total return in the past year and is being
maintained based upon our expectation for slower economic growth and a bias
towards slightly lower interest rates later in the year.
*The Retail Class A of the Achievement Intermediate Term Bond Fund produced a
total return of 6.91% for the period. Including the maximum sales charge of
3.50%, the total return of the Fund's Retail Class A was 3.13%.
12
<PAGE>
THE ACHIEVEMENT FUNDS
ACHIEVEMENT INTERMEDIATE TERM BOND FUND -- INSTITUTIONAL CLASS
[Graphic omitted]
Plot points are as follows:
Achievement Intermediate-Term Bond Fund, Lehman Intermediate Government/
Institutional Class 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
1/31/99 13,733 14,109
Average Annual Total Return
One Year Annualized Annualized Inception
Return Three Year Return to Date
- -------------------------------------------------------------------
Institutional 7.25% 6.01% 8.08%
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
ACHIEVEMENT INTERMEDIATE TERM BOND FUND -- RETAIL CLASS A
[Graphic omitted]
Plot points are as follows:
Achievement Intermediate-Term Bond Fund, Lehman Intermediate Government/
Retail Class A Corporate Bond Index
3/31/95 9,660 10,000
1/31/96 10,704 11,142
1/31/97 10,897 11,540
1/31/98 11,834 12,562
1/31/99 12,652 13,517
Average Annual Total Return
One Year Annualized Annualized Inception
Return Three Year Return to Date
- ----------------------------------------------------------------------
RETAIL A 6.91% 5.73% 7.48%
RETAIL A with load 3.13% 4.49% 6.50%
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.
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.
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
5.33%* for the fiscal year ended January 31, 1999. Using the 3-month T-bill as a
proxy, the average money market fund produced a total return of 5.21% for the
same time period. As an additional comparison, the Salomon One-Year Treasury
benchmark returned 5.60%.
Volatility in the fixed income markets has been quite high, not only due to
"flight to quality" issues, but also due to investors moving funds in and out of
the equity markets. We expect this pattern to continue in 1999. The 30-year
Treasury is likely to trade in a range of 5.00% to 5.50% through the first half
of the year. We expect that economic growth will slow sufficiently later in the
year to allow interest rates to have a downward bias.
Inflation as measured by the Consumer Price Index in 1998 was a low 1.6%. This
coupled with three Fed Funds rate cuts, totaling 75 basis points (0.75%), has
had the impact of setting the stage for a general reduction in interest rates
across the Treasury Yield Curve by a similar amount for the twelve months ended
January 31, 1999. Interest rates as measured by U.S. Treasury bonds fell from
5.81% to 5.09% for the 30-year bond, from 5.51% to 4.65% for the 10-year bond
and from 5.31% to 4.56% for the two year bond.
The 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 A of the Achievement Short Term Bond Fund produced a total
return of 4.94% for the period. Including the maximum sales charge of 1.50%,
the total return of the Fund's Retail Class A was 3.40%.
14
<PAGE>
THE ACHIEVEMENT FUNDS
ACHIEVEMENT SHORT TERM BOND FUND -- INSTITUTIONAL CLASS
[Graphic omitted]
Plot points are as follows:
Achievement Salomon 1-3 Year Salomon 1-Year
Short-Term Bond Fund, 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
1/31/99 12,673 13,362 12,881
Average Annual Total Return
One Year Annualized Annualized Inception
Return Three Year Return to Date
- --------------------------------------------------------------------------------
Institutional 5.33% 5.32% 6.00%
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
THE ACHIEVEMENT FUNDS
ACHIEVEMENT SHORT TERM BOND FUND -- RETAIL CLASS A
[GRAPHIC OMITTED]
Plot points are as follows:
Achievement Salomon 1-3 Year Salomon 1-Year
Short-Term Bond Fund, 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
1/31/99 12,110 12,930 12,567
Average Annual Total Return
One Year Annualized Annualized Inception
Return Three Year Return to Date
- -------------------------------------------------------------------------
RETAIL A 4.94% 5.00% 5.59%
RETAIL A with load 3.40% 4.46% 5.19%
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. At the end of the fiscal year
ended January 31, 1999, the Institutional Class of the Fund had a total return
of 3.26%*. In comparison, the Lehman Brothers One Year Municipal Bond Index
returned 4.78% for the same period. As an additional comparison, the Lipper
Short Term Municipal Bond Index had a return of 4.55%.
The Fund holds only municipal bonds with maturities of 4 years or less. The
current average maturity is 2.03 years. Holdings due in 1999 comprise 15.1% of
the Fund, with 37.0% maturing in 2000, 41.2% maturing in 2001, and 6.7% maturing
in 2002.
As of January 31, 1999, the structure of the Fund by quality is as follows: AAA
37%; AA 20%; A 19%; and BBB 16%. The Fund may own up to 20% of the assets in the
portfolio in BBB-rated issues. Securities subject to the Alternative Minimum Tax
(AMT) are not permitted in the portfolio. The Fund is a nationally diversified
fund and owns issues representing 19 states. Nine states each represent more
than 5% of the total: Hawaii 10.0%, Maryland 9.9%, New York 9.9%, South Carolina
9.9%, Kansas 6.7%, Mississippi 7.0%, Indiana 6.3%, Illinois 6.0%, and Arizona
5.3%. The bond market in 1998 rewarded fixed income investors. Concern over
global economic crises and a resulting flight to quality, low inflation, and a
solid domestic economy all contributed to a rally in the bond market, which
drove U.S. Treasury bond yields to record lows. The Federal Open Market
Committee (the Fed) acted aggressively to counterattack the crises by lowering
short rates a total of 75 basis points (0.75%) over a two-month period. Inspired
by the resulting increase in liquidity, stock and bond markets reached record
levels. Municipals did not participate in the bond market rally to the extent of
Treasury bonds. International investors seeking a refuge from global turmoil
were not buyers of municipal bonds. During the height of the crisis, it was
possible to invest in municipal bonds with yields that offered 99% to 100% of
the yield on U.S. Treasury bonds, making municipals a good buy relative to
Treasuries. The low interest rates and attractive spreads to Treasuries prompted
a flurry of refundings and new issues of municipal bonds in 1998. The yield on a
3-year A-rated general obligation bond dropped 45 basis points (0.45%) during
the year, from 4.10% to 3.65%.
The Achievement Short Term Municipal Bond Fund will be liquidating and closing
early in the first fiscal quarter of 1999.
*The Retail Class A of the Achievement Short Term Municipal Bond Fund produced a
total return of 3.18% for the period. Including the maximum sales charge of
1.50%, the total return of the Fund's Retail Class A was 1.66%.
16
<PAGE>
THE ACHIEVEMENT FUNDS
ACHIEVEMENT SHORT TERM MUNICIPAL BOND FUND -- INSTITUTIONAL CLASS
[GRAPHIC OMITTED]
Plot points are as follows:
Achievement Short-Term
Municipal Bond Fund, Lehman Brothers
Institutional Class 1-Year Municipal 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
1/31/99 11,897 12,246
Average Annual Total Return
One Year Annualized Annualized Inception
Return Three Year Return to Date
- ---------------------------------------------------------------
Institutional 3.26% 3.55% 4.34%
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
ACHIEVEMENT SHORT TERM MUNICIPAL BOND FUND -- RETAIL CLASS A
[GRAPHIC OMITTED]
Plot points are as follows:
Achievement Short-Term
Municipal Bond Fund, Lehman Brothers
Retail Class A 1-Year Municipal 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
1/31/99 11,457 12,021
Average Annual Total Return
One Year Annualized Annualized Inception
Return Three Year Return to Date
- -----------------------------------------------------------------------------
RETAIL A 3.18% 3.34% 4.17%
RETAIL A with load 4.66% 2.81% 3.78%
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
17
<PAGE>
THE ACHIEVEMENT IDAHO MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
The investment objective of the Achievement Idaho Municipal Bond Fund is to
provide as high a level of current income that is exempt from Federal and Idaho
state income tax as is consistent with preservation of capital. At the end of
the fiscal year ended January 31, 1999, the Institutional Class of the Fund had
a total return of 5.76%*. In comparison, the Lehman 5-Year and 10-Year Municipal
Bond Indexes produced total returns of 6.00% and 7.20% respectively for the same
period. As an additional comparison, the Lipper General Municipal Bond Index,
returned 5.73%.
As of January 31, 1999, the structure of the Fund by quality is as follows: AAA
70%; AA 17%; A 8.0%; BBB 4.0%. The Fund may own up to 20% of the assets in the
portfolio in BBB-rated issues. Average option-adjusted maturity for the Fund is
10.8 years, with 19.6% of the maturities within 1 to 10 years, 66.4% within 10
to 20 years, and 14.0% scheduled to mature in more than 20 years. The Fund may
hold up to 20% of assets in issues subject to the Alternative Minimum Tax (AMT).
Current AMT holdings comprise 3.8% of the portfolio. The Fund is a single state
fund, with issues representing 57 issuers in all parts of the state; 6.8% of the
Fund (4 issuers) is invested in investment grade Puerto Rico bonds, which are
also exempt from Federal and Idaho state income tax.
Buying bonds in the Idaho municipal market can be challenging at times as Idaho
residents only reluctantly approve new debt. Combine this with a relatively high
tax-rate, and many Idaho investors find Idaho municipals to be an attractive
investment. As we analyze bonds for the Fund, we focus on credit quality and how
well the bond meets the needs of our investors by contributing both income and
structure to the overall portfolio.
The bond market in 1998 rewarded fixed income investors. Concern over global
economic crises and a resulting flight to quality, low inflation, and a solid
domestic economy all contributed to a rally in the bond market which drove U.S.
Treasury bond yields to record lows. The Federal Open Market Committee (the Fed)
acted aggressively to counter attack the crisis by lowering short term rates a
total of 75 basis points (0.75%) over a two-month period. Inspired by the
resulting increase in liquidity, stock and bond markets reached record levels.
Municipals did not participate in the bond market rally to the extent of
Treasury bonds as international investors seeking a refuge from global turmoil
were not buyers of municipal bonds. During the height of the crisis, it was
possible to invest in municipal bonds with yields that offered 99% to 100% of
the yield on U.S. Treasury bonds, making municipals a good buy relative to
Treasuries. The low interest rates and attractive spreads to Treasuries prompted
a flurry of refundings and new issues of municipal bonds in 1998. The yield on a
10-year A-rated general obligation bond dropped 35 basis points (0.35%) during
the year, from 4.60% to 4.25%.
*The Retail Class A of the Achievement Idaho Municipal Bond Fund produced a
total return of 5.43% for the period. Including the maximum sales charge of
4.00%, the total return of the Fund's Retail Class A was 1.23%. The Retail
Class B of the Achievement Idaho Municipal Bond Fund produced a cumulative
inception to date return of 5.37%. Including the maximum sales charge of 5.00%,
the cumulative inception to date return of the Fund's Retail Class B was 0.37%.
18
<PAGE>
THE ACHIEVEMENT FUNDS
ACHIEVEMENT IDAHO MUNICIPAL BOND FUND -- INSTITUTIONAL CLASS
[GRAPHIC OMITTED]
Plot points are as follows:
Achievement Idaho Lehman 10-Year
Municipal Bond Fund, Lehman 5-Year Lehman Municipal
Institutional Class Municipal Bond Index Bond 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
1/31/99 13,403 13,241 14,502
Average Annual Total Return
One Year Annualized Annualized Inception
Return Three Year Return to Date
- --------------------------------------------------------------------
Institutional 5.76% 5.33% 7.40%
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
[GRAPHIC OMITTED]
Plot points are as follows:
ACHIEVEMENT IDAHO MUNICIPAL BOND FUND -- RETAIL CLASS A & B
<TABLE>
ACHIEVEMENT ACHIEVEMENT
IDAHO MUNICIPAL LEHMAN 5-YEAR LEHMAN 10-YEAR IDAHO MUNICIPAL LEHMAN 5-YEAR LEHMAN 10-YEAR
BOND FUND, MUNICIPAL BOND MUNICIPAL BOND BOND FUND, MUNICIPAL BOND MUNICIPAL BOND
RETAIL CLASS A INDEX INDEX RETAIL CLASSB INDEX INDEX
<S> <C> <C> <C> <C> <C> <C>
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
5/31/98 10,000 10,000 10,000
1/31/99 12,251 12,725 13,564 9,913 10,493 10,608
</TABLE>
Average Annual Total Return
One Year Annualized Annualized Inception
Return Three Year Return to Date
- ------------------------------------------------------------------------------
RETAIL A 5.43% 5.06% 6.76%
RETAIL A with load 4.23% 3.64% 5.64%
RETAIL B N/A N/A 5.37%
RETAIL B with load N/A N/A 0.37%
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
*Cumulative inception to date
19
<PAGE>
The Achievement Idaho Municipal Bond Fund (concluded)
- --------------------------------------------------------------------------------
The Idaho economy turned in another solid performance of steady growth in 1998.
Signs of life in the PC and DRAM computer chip markets gave the high-tech sector
a boost as employers and employees alike anticipate profitability for the first
time in several quarters. On the downside, commodity prices have reached levels
not seen in more than two decades, prompted by deflationary forces arising from
global economic turmoil. This has created a dire situation for Idaho's
agricultural economy as many farmers are hit with the lowest prices for their
crops in decades combined with excess global supply. While the agriculture
crisis is a concern for Idahoans in general, we do not anticipate that the Fund
will be impacted. We will monitor bonds of issuers located in some of the areas
with weaker economies.
Heading into the New Year, the U.S. economy continues to surprise investors.
After facing the global crisis head-on, comments early this year suggest that
the Fed may now regret having added quite so much fuel to the fire. Despite the
early strength in the economy in January, we believe that over time, more
domestic weakness will emerge as low inflation continues, and more low-priced
goods are imported by countries struggling to stabilize economies decimated by
1998's turmoil. Year 2000 (Y2K) uncertainty may add further concerns at some
time during the year. We will continue to strive to achieve the Fund's
investment goals to provide shareholders with stable, high-levels of income
exempt from Federal and Idaho state income tax. As conditions in the market
change, we will adjust the investment strategy of the Fund accordingly.
20
<PAGE>
THE ACHIEVEMENT FUNDS
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 Institutional Class of the Fund
produced a total return of 5.88%* for the fiscal year ended January 31, 1999. In
comparison, the Lehman Municipal Bond Index produced a return of 6.65% for the
same period. As an additional comparison, the Lipper General Municipal Bond
Index returned 5.73%.
As of January 31, 1999, the structure of the Fund by quality is as follows: AAA
32%; AA 22%; A 16%; BBB 15%. The Fund may own up to 20% of the assets in the
portfolio in BBB-rated issues. Average option-adjusted maturity for the Fund is
12.8 years, with 25.5% of the maturities within 1 to 10 years, 67.8% within 10
to 20 years, and 6.6% more than 20 years. The Fund may hold up to 20% of assets
in issues subject to the Alternative Minimum Tax (AMT). Current AMT holdings
comprise 19.4% of the portfolio. The Fund is a nationally diversified fund and
owns issues representing 41 states, including the District of Columbia and
Puerto Rico. Five states each represent more than 5% of the total: New York
8.0%; Pennsylvania 8.0%; Alaska 6.2%; Ohio 6.2%; and Illinois 5.7%.
In analyzing bonds for the Fund, individual bonds are examined as unique assets
based on credit quality, structure, liquidity, and historical performance. From
this analysis, a decision is then made if a specific situation will enhance the
overall characteristics of the Fund. This kind of in-depth review can help find
sectors or maturity structures which may be undervalued relative to the rest of
the market and add value to the portfolio.
The bond market in 1998 rewarded fixed income investors. Concern over global
economic crises and a resulting flight to quality, low inflation, and a solid
domestic economy all contributed to a rally in the bond market which drove U.S.
Treasury bond yields to record lows. The Federal Open Market Committee (the Fed)
acted aggressively to counter attack the crisis by lowering short term rates a
total of 75 basis points (0.75%) over a two-month period. Inspired by the
resulting increase in liquidity, stock and bond markets reached record levels.
Municipals did not participate in the bond market rally to the extent of U.S.
Treasury bonds as international investors seeking a refuge from global turmoil
were not buyers of municipal bonds. During the height of the crisis, it was
possible to invest in municipal bonds with yields that offered 99% to 100% of
the yield on U.S. Treasury bonds, making municipals a good buy relative to
Treasuries. The low interest rates and attractive spreads to Treasuries prompted
a flurry of refundings and new issues of municipal bonds in 1998. The yield on a
10-year A-rated general obligation bond dropped 35 basis points (0.35%) during
the year, from 4.60% to 4.25%.
Heading into 1999, the U.S. economy continues to surprise investors. After
facing the global crisis head-on, comments early this year suggest that the Fed
may now regret having added quite so much fuel to the fire. Despite the early
strength in the economy in January, we believe that over time, more domestic
weakness will emerge as low inflation continues, and more low-priced goods are
imported by countries struggling to stabilize economies decimated by 1998's
turmoil. Year 2000 (Y2K) uncertainty may add further concerns at some time
during the year. We will continue to strive to achieve the Fund's investment
goals to provide shareholders with stable, high-levels of tax-exempt income. As
conditions in the market change, we will adjust the investment strategy of the
Fund accordingly.
*The Retail Class A of the Achievement Municipal Bond Fund produced a total
return of 5.48% for the period. Including the maximum sales charge of 4.00%, the
total return of the Fund's Retail Class A was 1.29%. The Retail Class B of the
Achievement Municipal Bond Fund produced a cumulative inception to date return
of 4.87%. Including the maximum sales charge of 5.00%, cumulative inception to
date return of the Fund's Retail Class B was -0.13%.
21
<PAGE>
ACHIEVEMENT MUNICIPAL BOND FUND -- INSTITUTIONAL CLASS
[GRAPHIC OMITTED]
Plot points are as follows:
Achievement Lehman Lehman
Municipal Bond Fund, Municipal General Municipal
Institutional Class Bond Index Debt Funds Average
10/31/96 10,000 10,000 10,000
1/31/97 10,135 10,159 10,132
1/31/98 11,138 11,188 11,165
1/31/99 11,793 11,932 11,778
Average Annual Total Return
One Year Annualized Inception
Return to Date
- -----------------------------------------------------------------------
Institutional 5.88% 7.60%
Past performance of the Fund is not predictive of future performance.
ACHIEVEMENT MUNICIPAL BOND FUND -- RETAIL CLASS A & B
[GRAPHIC OMITTED]
Plot points are as follows:
<TABLE>
Achievement Lehman Lipper Achievement Lehman Lipper
Municipal Bond Fund, Municipal General Municipal Municipal Bond Fund, Municipal General Municipal
Retail Retail Class A Bond Fund Index Debt Funds Average Retail Class B Bond Fund Index Debt Funds Average
<S> <C> <C> <C> <C> <C> <C>
11/30/96 9,600 10,000 10,000
1/31/97 9,540 9,977 9,957
1/31/98 10,474 10,987 10,972
5/31/98 10,000 10,000 10,000
1/31/99 11,047 11,717 11,574 9,883 10,534 10,450
</TABLE>
Average Annual Total Return
One Year Annualized Inception
Return to Date
- ------------------------------------------------------------------------
RETAIL A 5.48% 7.47%
RETAIL A with load 4.29% 5.52%
RETAIL B N/A 4.87%
RETAIL B with load N/A -0.13%
PAST PERFORMANCE OF THE FUND IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
*Cumulative inception to date
22
<PAGE>
JANUARY 31, 1999 THE ACHIEVEMENT FUNDS
Statement of Net Assets
- -------------------------------------------------------------
EQUITY FUND
- -------------------------------------------------------------
[PIE CHART OMITTED]
Plot points are as follows:
Oil-Energy 5.5%
Retail 9.7%
Chemical and Drugs 11.4%
Financial 12.9%
Real Estate Investment Trust 0.5%
Technologies 33.3%
Other 13.8%
Consumer Products 12.9%
% of Total Portfolio Investments
- --------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------
COMMON STOCKS -- 98.8%
AIR TRANSPORTATION -- 0.9%
AMR* 45,000 $ 2,644
--------
AUTOMOTIVE -- 1.0%
General Motors 33,000 2,962
--------
BANKS -- 4.6%
Bank One 100,000 5,237
BankAmerica 75,000 5,016
Wells Fargo 80,000 2,795
--------
13,048
--------
BEAUTY PRODUCTS -- 2.1%
Gillette 100,000 5,875
--------
CAPITAL GOODS -- 4.1%
General Electric 110,000 11,536
--------
CHEMICALS -- 1.2%
Monsanto 75,000 3,567
--------
COMPUTER SOFTWARE -- 3.4%
Microsoft* 55,000 9,625
--------
COMPUTERS & SERVICES -- 11.7%
Cisco Systems* 71,500 7,977
Dell Computer* 100,000 10,000
Hewlett-Packard 90,000 7,054
International Business
Machines 45,000 8,246
--------
33,277
--------
- --------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------
CONGLOMERATE -- 3.0%
Tyco International 110,000 $ 8,477
--------
CONTAINERS & PACKAGING -- 1.7%
Newell 116,000 4,821
--------
DRUGS -- 9.4%
Abbott Laboratories 49,200 2,285
American Home Products 100,000 5,869
Merck 40,000 5,870
Pfizer 28,000 3,601
Schering Plough 75,000 4,088
Warner Lambert 72,000 5,198
--------
26,911
--------
ENTERTAINMENT -- 3.0%
Carnival 112,000 5,495
Walt Disney 98,000 3,234
--------
8,729
--------
FINANCIAL SERVICES -- 5.4%
American Express 40,000 4,115
Capital One Financial 55,000 7,281
Federal National Mortgage
Association 55,000 4,008
--------
15,404
--------
FOOD, BEVERAGE & TOBACCO -- 2.7%
Coca-Cola 35,000 2,290
PepsiCo 135,000 5,273
--------
7,563
--------
HOLDING COMPANY -- 1.9%
Berkshire Hathaway, Cl B* 2,520 5,418
--------
INSURANCE -- 2.9%
American International Group 54,000 5,559
Citigroup 50,000 2,803
--------
8,362
--------
MEDICAL PRODUCTS & SERVICES -- 0.8%
Johnson & Johnson 27,000 2,295
--------
PETROLEUM & FUEL PRODUCTS -- 0.4%
R & B Falcon* 150,000 1,059
--------
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
23
<PAGE>
JANUARY 31, 1999
STATEMENT OF NET ASSETS
EQUITY FUND (CONCLUDED)
- --------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------
PETROLEUM PRODUCTS & SERVICES-- 5.1%
Coastal 100,000 $ 2,981
Exxon 66,000 4,649
Mobil 45,000 3,946
Schlumberger 60,000 2,858
--------
14,434
--------
PRINTING & PUBLISHING -- 1.3%
McGraw-Hill 34,000 3,676
--------
RETAIL -- 9.7%
American Stores 100,000 3,625
Dayton-Hudson 107,000 6,821
Dollar Tree Stores* 66,000 2,850
Home Depot 70,000 4,226
Rite Aid 85,000 4,176
Wal-Mart Stores 70,000 6,020
--------
27,718
--------
SEMI-CONDUCTORS/INSTRUMENTS-- 7.2%
Altera* 85,000 5,344
Analog Devices* 150,000 4,463
Intel 75,000 10,570
--------
20,377
--------
TELEPHONES & TELECOMMUNICATION -- 11.0%
AT&T 80,000 7,260
Lucent Technologies 55,000 6,191
MCI WorldCom 100,000 7,975
Qwest Communications
International* 125,000 7,492
SBC Communication 43,000 2,322
--------
31,240
--------
WATER TREATMENT SYSTEMS -- 1.6%
U.S. Filter* 200,000 4,638
--------
WHOLESALE -- 2.7%
McKesson Hboc 66,600 5,003
U.S. Foodservice* 50,000 2,625
--------
7,628
--------
TOTAL COMMON STOCKS
(Cost $179,367) 281,284
--------
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
CASH EQUIVALENTS -- 0.5%
SEI Daily Income Trust
Money Market Portfolio $648 $ 648
SEI Daily Income Trust Prime
Obligation Portfolio 705 705
--------
TOTAL CASH EQUIVALENTS
(Cost $1,353) 1,353
--------
TOTAL INVESTMENTS -- 99.3%
(Cost $180,720) 282,637
--------
OTHER ASSETS AND LIABILITIES,
NET-- 0.7% 2,009
--------
NET ASSETS:
Portfolio Shares of Institutional
Class (unlimited authorization
-- no par value) based on
14,996,928 outstanding shares
of beneficial interest 168,134
Portfolio Shares of Retail Class A
(unlimited authorization -- no
par value) based on 669,897
outstanding shares of beneficial
interest 9,684
Portfolio Shares of Retail Class B
(unlimited authorization -- no
par value) based on 121,888
outstanding shares of beneficial
interest 1,988
Overdistributed net investment income (9)
Accumulated net realized gain on
investments 2,932
Net unrealized appreciation on
investments 101,917
--------
TOTAL NET ASSETS -- 100.0% $284,646
========
NET ASSET VALUE, OFFERING
AND REDEMPTION PRICE PER
SHARE -- INSTITUTIONAL CLASS $18.03
========
NET ASSET VALUE AND REDEMPTION PRICE
PER SHARE -- RETAIL CLASS A $18.01
========
MAXIMUM OFFERING PRICE PER SHARE --
RETAIL CLASS A ($18.01 / 95.5%) $18.86
========
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE
-- RETAIL CLASS B $17.93
========
- --------------------------------------------------------------------------------
* NON-INCOME PRODUCING SECURITY
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
24
<PAGE>
THE ACHIEVEMENT FUNDS
- --------------------------------------------------------
BALANCED FUND
- --------------------------------------------------------
[PIE CHART OMITTED]
Plot points are as follows:
Other 4.1%
Corporate Securities 12.1%
Treasuries Obligations 13.9%
Non-Agency Mortgage-Backed Securities 0.6%
Common Stocks 63.3%
% of Total Portfolio Investments
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
U.S. TREASURY OBLIGATIONS -- 10.6%
U.S. Treasury Notes
7.000%, 04/15/99 $2,500 $ 2,512
8.000%, 08/15/99 2,000 2,036
7.750%, 11/30/99 2,500 2,562
7.750%, 02/15/01 2,500 2,649
7.875%, 08/15/01 2,500 2,690
7.500%, 05/15/02 2,500 2,712
6.250%, 02/15/03 2,500 2,642
7.250%, 05/15/04 2,500 2,798
7.875%, 11/15/04 2,500 2,895
--------
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $22,054) 23,496
--------
U.S. GOVERNMENT AGENCY OBLIGATIONS -- 3.3%
Federal Home Loan
Mortgage Corporation
5.750%, 07/15/03 2,000 2,059
5.750%, 04/15/08 2,500 2,590
Federal National Mortgage
Association
6.000%, 05/15/08 2,500 2,642
--------
TOTAL U.S. GOVERNMENT AGENCY
OBLIGATIONS
(Cost $6,979) 7,291
--------
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
ASSET-BACKED SECURITIES -- 1.3%
American Southwest Financial
Securities, Series 1996-FHA1,
Class A2
7.000%, 11/25/38 $1,458 $ 1,453
Olympic Automobile Receivables
Trust, Series 1995-E, Class A5
5.950%, 11/15/01 1,325 1,330
--------
TOTAL ASSET-BACKED SECURITIES
(Cost $2,791) 2,783
--------
CORPORATE BONDS -- 10.8%
ENTERTAINMENT -- 1.0%
Walt Disney, MTN
5.125%, 12/15/03 2,255 2,241
--------
FINANCE -- 7.4%
Aetna Services
7.125%, 08/15/06 1,500 1,597
Associates of North America, MTN
8.420%, 01/05/00 2,000 2,054
Banc One
7.250%, 08/01/02 1,500 1,588
BankAmerica, MTN
7.125%, 05/12/05 2,000 2,150
Chase Manhattan
6.500%, 01/15/09 2,000 2,092
First Union
7.500%, 07/15/06 2,000 2,217
Ford Motor Credit
7.750%, 10/01/99 2,000 2,035
6.250%, 11/08/00 1,000 1,014
Safeco
6.875%, 07/15/07 1,500 1,556
--------
16,303
--------
INDUSTRIAL -- 2.4%
Lucent Technologies
7.250%, 07/15/06 2,000 2,233
Philip Morris
7.250%, 09/15/01 2,000 2,080
Seagram, YB
6.500%, 04/01/03 1,000 1,018
--------
5,331
--------
TOTAL CORPORATE BONDS
(Cost $22,719) 23,875
--------
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
25
<PAGE>
JANUARY 31, 1999
STATEMENT OF NET ASSETS
BALANCED FUND (CONTINUED)
- --------------------------------------------------------
FACE AMOUNT MARKET
DESCRIPTION (000) SHARES VALUE (000)
- --------------------------------------------------------
MORTGAGE-BACKED SECURITY -- 0.6%
Donaldson Lufkin Jenrette Mortgage
Association, Series 1997-CF1,
Class A1B (B)
7.600%, 04/15/07 $ 1,200 $ 1,317
--------
TOTAL MORTGAGE-BACKED SECURITY
(Cost $1,208) 1,317
--------
COMMON STOCKS -- 69.3%
AUTOMOTIVE -- 1.0%
General Motors 25,000 2,244
--------
BANKS -- 3.3%
Bank One 59,664 3,125
BankAmerica 37,368 2,499
Wells Fargo 50,000 1,747
--------
7,371
--------
BEAUTY PRODUCTS -- 1.3%
Gillette 47,000 2,761
--------
CAPITAL GOODS -- 2.8%
General Electric 58,000 6,083
--------
CHEMICALS -- 0.6%
Monsanto 30,000 1,427
--------
COMPUTER SOFTWARE -- 3.0%
Microsoft* 38,000 6,650
--------
COMPUTERS & SERVICES -- 8.7%
Cisco Systems* 45,248 5,048
Dell Computer* 56,000 5,600
Hewlett Packard 40,000 3,135
International Business
Machines 29,000 5,314
--------
19,097
--------
CONGLOMERATE -- 1.9%
Tyco International 54,000 4,161
--------
CONTAINERS & PACKAGING -- 0.8%
Newell 44,000 1,829
--------
- ---------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------
DRUGS -- 8.3%
Abbott Laboratories 35,000 $ 1,625
American Home Products 54,000 3,169
Merck 29,000 4,256
Pfizer 13,000 1,672
Schering Plough 50,000 2,725
SmithKline Beecham, ADR 32,000 2,170
Warner Lambert 38,000 2,743
--------
18,360
--------
ENTERTAINMENT -- 1.9%
Carnival 54,000 2,649
Walt Disney 49,000 1,617
--------
4,266
--------
FINANCIAL SERVICES -- 4.7%
American Express 23,000 2,366
Capital One Financial 31,000 4,104
Federal National Mortgage
Association 40,000 2,915
Imperial Credit Industries* 38,984 302
Starwood Hotels and Resorts
World Wide 28,516 713
--------
10,400
--------
HOLDING COMPANY -- 1.3%
Berkshire Hathaway, Cl B* 1,365 2,935
--------
FOOD, BEVERAGE & TOBACCO -- 1.8%
Coca-Cola 20,000 1,309
PepsiCo 67,000 2,617
--------
3,926
--------
INSURANCE -- 1.7%
American International Group 36,000 3,706
--------
MEDICAL PRODUCTS & SERVICES -- 0.6%
Johnson & Johnson 15,000 1,275
--------
PETROLEUM PRODUCTS & SERVICES-- 2.8%
Coastal 52,000 1,550
Exxon 36,000 2,536
Mobil 24,000 2,105
--------
6,191
--------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
26
<PAGE>
THE ACHIEVEMENT FUNDS
- --------------------------------------------------------
FACE AMOUNT MARKET
DESCRIPTION (000) SHARES VALUE (000)
- --------------------------------------------------------
PRINTING & PUBLISHING -- 1.0%
McGraw-Hill 20,000 $ 2,163
--------
RAILROADS -- 0.4%
Union Pacific 17,500 900
--------
RETAIL -- 6.5%
American Stores 55,000 1,994
Dayton-Hudson 52,000 3,315
Dollar Tree Stores* 34,000 1,468
Home Depot 42,000 2,536
Rite Aid 44,000 2,162
Wal-Mart Stores 33,000 2,838
--------
14,313
--------
SEMI-CONDUCTORS/INSTRUMENTS -- 2.7%
Intel 42,000 5,919
--------
TELEPHONES & TELECOMMUNICATION -- 9.7%
AT&T 55,000 4,991
Lucent Technologies 40,000 4,503
MCI WorldCom* 45,000 3,589
Qwest Communications
International* 75,000 4,495
SBC Communications 42,000 2,268
U.S. West 24,000 1,481
--------
21,327
--------
WATER TREATMENT SYSTEMS -- 1.2%
U.S. Filter* 117,000 2,713
--------
WHOLESALE -- 1.3%
McKesson Hboc 38,850 2,919
--------
TOTAL COMMON STOCKS
(Cost $98,878) 152,936
--------
CASH EQUIVALENTS -- 3.7%
SEI Daily Income Trust Money
Market Portfolio 4,604 4,604
SEI Daily Income Trust Prime
Obligation Portfolio 3,640 3,640
--------
TOTAL CASH EQUIVALENTS
(Cost $8,244) 8,244
--------
TOTAL INVESTMENTS -- 99.6%
(Cost $162,873) 219,942
--------
OTHER ASSETS AND LIABILITIES, NET -- 0.4% 817
--------
- ---------------------------------------------------------
MARKET
DESCRIPTION VALUE (000)
- ---------------------------------------------------------
NET ASSETS:
Portfolio Shares of Institutional
Class (unlimited authorization--
no par value) based on
15,360,784 outstanding shares
of beneficial interest $162,550
Portfolio Shares of Retail Class A
(unlimited authorization --
no par value) based on 310,447
outstanding shares of beneficial
interest 3,738
Portfolio Shares of Retail Class B
(unlimited authorization --
no par value) based on 106,145
outstanding shares of beneficial
interest 1,422
Undistributed net investment income 242
Accumulated net realized loss on
investments (4,262)
Net unrealized appreciation on
investments 57,069
--------
TOTAL NET ASSETS -- 100.0% $220,759
========
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE --
INSTITUTIONAL CLASS $13.99
========
NET ASSET VALUE AND REDEMPTION PRICE
PER SHARE -- RETAIL CLASS A $13.97
========
MAXIMUM OFFERING PRICE PER SHARE --
RETAIL CLASS A ($13.97 / 95.5%) $14.63
========
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE --
RETAIL CLASS B $13.95
========
- ------------------------------------------------------
* NON-INCOME PRODUCING SECURITY
ADR -- AMERICAN DEPOSITORY RECEIPT
CL -- CLASS
MTN -- MEDIUM TERM NOTE
YB -- YANKEE BOND
(B) PRIVATE PLACEMENT
(CONCLUDED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
27
<PAGE>
JANUARY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
INTERMEDIATE TERM BOND FUND
- --------------------------------------------------------------------------------
[PIE CHART OMITTED]
Plot points are as follows:
Non-Agency Mortgage-Backed Securities 6.7%
Asset-Backed Securities 4.8%
Cash Equivalents 1.8%
Other 1.2%
Corporate Securites 38.6%
U.S. Government Securities 46.9%
% of Total Portfolio Investments
- --------------------------------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------------------------------
CORPORATE BONDS -- 38.6%
BANKS -- 0.6%
First Tennessee National Bank
5.750%, 12/01/08 $1,000 $ 997
--------
ELECTRICAL UTILITIES -- 1.2%
Consolidated Edison
6.150%, 07/01/08 1,000 1,056
Scana, MTN
6.250%, 07/08/03 1,000 1,028
--------
2,084
--------
FINANCE -- 15.5%
Aetna Services
6.750%, 08/15/01 2,000 2,055
American General Finance
7.250%, 04/15/00 1,000 1,021
Associates of North America, MTN
6.810%, 08/03/01 1,000 1,034
7.540%, 04/14/04 1,000 1,091
BankAmerica
7.125%, 05/01/06 2,000 2,155
Chase Manhattan
8.125%, 06/15/02 1,000 1,074
6.375%, 02/15/08 1,000 1,040
Citicorp
7.125%, 06/01/03 1,000 1,056
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
FINANCE (CONTINUED)
Commercial Credit
6.875%, 05/01/02 $1,000 $ 1,040
First Union
7.050%, 08/01/05 1,000 1,072
Ford Motor Credit
8.000%, 06/15/02 1,000 1,074
7.750%, 03/15/05 1,000 1,107
General Motors Acceptance, MTN
7.250%, 05/15/03 1,000 1,060
Grand Metro
7.125%, 09/15/04 1,000 1,071
Household Finance
7.650%, 05/15/07 1,000 1,108
J.P. Morgan
7.250%, 01/15/02 1,000 1,051
Lehman Brothers Holdings
6.125%, 07/15/03 1,000 989
Lehman Brothers Holdings, MTN
7.110%, 09/27/99 1,000 1,009
NationsBank
7.625%, 04/15/05 1,000 1,094
Salomon, MTN
7.000%, 05/15/99 1,000 1,005
Sears Roebuck Acceptance
6.950%, 05/15/02 1,000 1,039
Sears Roebuck Acceptance, MTN
6.580%, 11/20/03 1,000 1,041
Society National Bank
7.250%, 06/01/05 1,000 1,080
--------
26,366
--------
INDUSTRIAL -- 13.7%
American Home Products
7.700%, 02/15/00 1,000 1,024
AT&T
6.750%, 04/01/04 1,000 1,064
CSR America
6.875%, 07/21/05 2,000 2,155
CSX Transportation
7.540%, 03/15/03 1,000 1,060
Dayton Hudson
7.500%, 07/15/06 2,000 2,228
Dow Capital, YB
7.125%, 01/15/03 1,000 1,055
Hertz
7.000%, 07/01/04 2,000 2,065
J.C. Penney, MTN
7.050%, 05/23/05 1,000 1,055
Kerr-McGee
6.625%, 10/15/07 1,000 1,060
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
28
<PAGE>
THE ACHIEVEMENT FUNDS
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
INDUSTRIAL (CONTINUED)
MCI Communications
7.125%, 01/20/00 $1,000 1,015
Nabisco
6.700%, 06/15/02 1,000 1,014
Pacific Bell
7.000%, 07/15/04 1,000 1,073
Ryder Systems
7.340%, 11/01/00 1,040 1,066
Sara Lee, MTN
7.400%, 03/22/02 1,000 1,059
Texas Instruments, MTN
6.875%, 07/15/00 1,000 1,021
Wal-Mart Stores
6.500%, 06/01/03 1,000 1,053
Walt Disney
6.750%, 03/30/06 2,000 2,165
Waste Management
7.700%, 10/01/02 1,000 1,059
--------
23,291
--------
TELEPHONES & TELECOMMUNICATION -- 2.1%
GTE California
5.500%, 01/15/09 1,000 998
Southwestern Bell Telephone, MTN
5.750%, 09/01/04 1,000 1,005
U.S. West Communications
5.625%, 11/15/08 1,000 1,009
Worldcom
6.125%, 08/15/01 500 508
--------
3,520
--------
UTILITIES -- 5.5%
Consolidated Edison
6.375%, 04/01/03 1,000 1,044
Norfolk Southern
6.950%, 05/01/02 1,000 1,041
Pacific Gas & Electric, MTN
6.680%, 03/19/03 1,000 1,041
Philadelphia Electric
6.625%, 03/01/03 1,000 1,046
Public Service Electric & Gas
6.500%, 05/01/04 1,000 1,045
Rochester Gas & Electric, MTN
6.375%, 07/30/03 1,000 1,027
Southwestern Bell Telephone, MTN
6.250%, 03/12/01 1,150 1,174
Telstra
6.500%, 07/31/03 1,000 1,043
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
UTILITIES (CONTINUED)
Union Electric
6.750%, 10/15/99 $1,000 $ 1,010
--------
9,471
--------
TOTAL CORPORATE BONDS
(Cost $63,716) 65,729
--------
U.S. TREASURY OBLIGATIONS -- 34.8%
U.S. Treasury Bonds
7.625%, 02/15/07 1,000 1,081
7.125%, 02/15/23 2,000 2,476
6.250%, 08/15/23 2,000 2,246
6.500%, 11/15/26 1,000 1,169
U.S. Treasury Notes
7.125%, 02/29/00 4,000 4,101
6.750%, 04/30/00 3,000 3,073
6.250%, 08/31/00 4,000 4,093
7.750%, 02/15/01 2,500 2,649
7.875%, 08/15/01 1,500 1,614
6.375%, 09/30/01 4,000 4,169
7.500%, 11/15/01 1,000 1,073
6.250%, 08/31/02 4,000 4,200
6.250%, 02/15/03 1,000 1,057
5.500%, 05/31/03 2,000 2,063
5.375%, 06/30/03 2,000 2,056
7.500%, 02/15/05 1,000 1,144
6.500%, 08/15/05 2,000 2,196
6.875%, 05/15/06 1,000 1,129
7.000%, 07/15/06 2,000 2,274
6.500%, 10/15/06 6,000 6,650
6.250%, 02/15/07 3,000 3,290
6.125%, 08/15/07 3,000 3,276
5.625%, 05/15/08 2,000 2,129
--------
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $56,506) 59,208
--------
U.S. GOVERNMENT AGENCY OBLIGATIONS -- 12.1%
Federal Home Loan Bank
7.190%, 04/27/01 1,000 1,047
7.280%, 07/25/01 1,000 1,054
7.390%, 08/22/01 1,000 1,058
5.600%, 10/28/03 1,000 989
7.380%, 08/05/04 2,000 2,215
5.450%, 01/12/09 2,000 2,009
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
29
<PAGE>
JANUARY 31, 1999
STATEMENT OF NET ASSETS
INTERMEDIATE TERM BOND FUND (CONCLUDED)
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
U.S. GOVERNMENT AGENCY OBLIGATIONS (CONTINUED)
Federal Home Loan Mortgage Corporation
5.750%, 07/15/03 $2,000 $ 2,059
6.795%, 12/01/03 1,000 1,072
6.000%, 06/23/04 1,000 999
5.125%, 10/15/08 1,000 991
Federal National Mortgage Association
5.750%, 04/15/03 2,000 2,058
4.750%, 11/14/03 2,000 1,978
6.850%, 04/05/04 1,000 1,078
6.440%, 05/01/08 993 1,035
Federal National Mortgage Association, MTN
6.625%, 04/18/01 1,000 1,035
--------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS
(Cost $20,467) 20,677
--------
ASSET-BACKED SECURITIES -- 4.8%
Champion Home Equity Trust,
Series 1997-Z, Class A3
6.770%, 03/25/15 2,000 2,043
Olympic Automobile Receivables
Trust, Series 1995-E, Class A5
5.950%, 11/15/01 2,000 2,008
Olympic Automobile Receivables
Trust, Series 1996-B, Class A5
6.900%, 02/15/04 2,000 2,060
WFS Financial Owner Trust,
Series 1998-B, Class A4
6.050%, 04/20/03 2,000 2,041
--------
TOTAL ASSET-BACKED SECURITIES
(Cost $8,011) 8,152
--------
NON-AGENCY MORTGAGE-BACKED SECURITIES -- 6.7%
American Southwest Financial
Securities, Series 1996-FHA1,
Class A2
7.000%, 11/25/38 2,915 2,907
Donaldson Lufkin Jenrette Mortgage
Association, Series 1996-CF2,
Class A1B (B)
7.290%, 11/12/21 3,000 3,275
Donaldson Lufkin Jenrette Mortgage
Association, Series 1997-CF1,
Class A1B (B)
7.600%, 04/15/07 2,000 2,195
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
NON-AGENCY MORTGAGE-BACKED SECURITIES (CONTINUED)
Lehman Brothers Commercial
Conduit Mortgage Trust,
Series 1998-C1, Cl B
6.590%, 01/18/08 $3,000 $ 3,097
--------
TOTAL NON-AGENCY MORTGAGE-BACKED
SECURITIES
(Cost $11,004) 11,474
--------
CASH EQUIVALENTS -- 1.8%
SEI Daily Income Trust
Money Market Portfolio 1,162 1,162
SEI Daily Income Trust Prime
Obligation Portfolio 1,851 1,851
--------
TOTAL CASH EQUIVALENTS
(Cost $3,013) 3,013
--------
TOTAL INVESTMENTS -- 98.8%
(Cost $162,717) 168,253
--------
OTHER ASSETS AND LIABILITIES, NET -- 1.2% 2,035
--------
NET ASSETS:
Portfolio Shares of Institutional
Class (unlimited authorization
-- no par value) based on
15,654,528 outstanding shares of
beneficial interest 165,027
Portfolio Shares of Retail Class A
(unlimited authorization --
no par value) based on 161,511
outstanding shares of beneficial
interest 1,650
Accumulated net realized loss on
investments (1,925)
Net unrealized appreciation on
investments 5,536
--------
TOTAL NET ASSETS -- 100.0% $170,288
========
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE --
INSTITUTIONAL CLASS $10.77
========
NET ASSET VALUE AND REDEMPTION PRICE
PER SHARE -- RETAIL CLASS A $10.79
========
MAXIMUM OFFERING PRICE PER SHARE --
RETAIL CLASS A ($10.79 / 96.5%) $11.18
========
- ------------------------------------------------------
(B) PRIVATE PLACEMENT
MTN -- MEDIUM TERM NOTE
YB -- YANKEE BOND
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
30
<PAGE>
THE ACHIEVEMENT FUNDS
- --------------------------------------------------------
SHORT TERM BOND FUND
- --------------------------------------------------------
[PIE CHART OMITTED]
Plot points are as follows:
Cash Equivalents 1.0%
U.S. Government Securities 25.4%
Corporate Securites 73.6%
% of Total Portfolio Investments
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
CORPORATE BONDS -- 76.3%
FINANCE -- 38.1%
Associates of North America
6.250%, 03/15/99 $1,000 $ 1,001
6.375%, 08/15/99 1,000 1,007
Bankers Trust New York
6.625%, 07/30/99 1,000 1,003
Beneficial, Series H, MTN
6.330%, 12/18/00 1,000 1,011
CIT Group Holdings, MTN
6.625%, 09/13/99 1,400 1,414
Ford Motor Credit, MTN
6.950%, 05/15/00 1,000 1,019
General Motors Acceptance, MTN
6.700%, 07/02/99 1,000 1,006
7.125%, 05/10/00 1,000 1,020
Goldman Sachs
6.200%, 12/15/00 1,000 1,010
Household Bank FSB
6.250%, 04/01/99 1,000 1,001
International Lease Finance,
Series J, MTN
6.030%, 04/05/01 1,000 1,011
Morgan Stanley Group, MTN
6.375%, 01/18/00 1,000 1,010
Salomon Smith Barney
6.500%, 03/01/00 1,000 1,009
Travelers Property & Casualty
6.750%, 09/01/99 1,000 1,008
--------
14,530
--------
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
FINANCIAL SERVICES -- 2.7%
Merrill Lynch
6.500%, 04/01/01 $1,000 $ 1,020
--------
GAS/NATURAL GAS -- 1.0%
Northern Illinois Gas
6.450%, 08/01/01 375 384
--------
INDUSTRIAL -- 23.9%
Albertsons
6.375%, 06/01/00 1,000 1,014
Coca-Cola Enterprises
7.000%, 11/15/99 1,000 1,014
CSC Enterprises
6.800%, 04/15/99 1,000 1,003
CSX Transport
5.740%, 03/15/99 1,000 1,000
Ingersoll Rand, MTN
6.510%, 08/09/99 1,000 1,006
J.C. Penney, 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 1,015
Southwestern Bell Capital, MTN
7.000%, 11/22/99 1,000 1,013
--------
9,091
--------
UTILITY -- 10.6%
Detroit Edison, MTN
6.390%, 03/15/00 1,000 1,014
Georgia Power
6.125%, 09/01/99 2,000 2,013
Midwest Power
6.750%, 02/01/00 1,000 1,014
--------
4,041
--------
TOTAL CORPORATE BONDS
(Cost $28,983) 29,066
--------
U.S. GOVERNMENT AGENCY OBLIGATIONS -- 26.3%
Federal Home Loan Bank
5.950%, 01/29/01 1,000 1,000
5.230%, 11/16/01 1,000 992
5.435%, 01/29/02 1,000 1,000
Federal Home Loan Mortgage Corporation
5.890%, 02/02/01 1,000 1,000
5.500%, 01/07/02 1,000 998
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
31
<PAGE>
JANUARY 31, 1999
STATEMENT OF NET ASSETS
SHORT TERM BOND FUND (CONCLUDED)
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
U.S. GOVERNMENT AGENCY OBLIGATIONS (CONTINUED)
Federal National Mortgage Association, MTN
6.120%, 08/25/00 $2,000 $ 2,012
6.310%, 09/14/00 2,000 2,016
5.410%, 02/04/02 1,000 1,000
--------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS
(Cost $10,000) 10,018
--------
CASH EQUIVALENTS -- 1.0%
SEI Daily Income Trust
Money Market Portfolio 276 276
SEI Daily Income Trust
Prime Obligation Portfolio 92 92
--------
TOTAL CASH EQUIVALENTS
(Cost $368) 368
--------
TOTAL INVESTMENTS -- 103.6%
(Cost $39,351) 39,452
--------
OTHER ASSETS AND LIABILITIES, NET-- (3.6%) (1,353)
--------
NET ASSETS:
Portfolio Shares of Institutional Class
(unlimited authorization -- no par value)
based on 3,789,266. outstanding shares
of beneficial interest 40,212
Portfolio Shares of Retail Class A
(unlimited authorization -- no par value)
based on 14,829 outstanding
shares of beneficial interest 151
Accumulated net realized loss
on investments (2,365)
Net unrealized appreciation
on investments 101
--------
TOTAL NET ASSETS -- 100.0% $38,099
========
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE --
INSTITUTIONAL CLASS $10.02
========
NET ASSET VALUE AND REDEMPTION PRICE
PER SHARE -- RETAIL CLASS A $10.00
========
MAXIMUM OFFERING PRICE PER SHARE --
RETAIL CLASS A ($10.00 / 98.5%) $10.15
========
- ------------------------------------------------------
MTN - MEDIUM TERM NOTE
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
- --------------------------------------------------------
SHORT TERM MUNICIPAL
BOND FUND
- --------------------------------------------------------
[PIE CHART OMITTED]
Plot points are as follows:
Revenue Bonds 58.9%
General Obligations 41.1%
% of Total Portfolio Investments
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
MUNICIPAL BONDS -- 101.0%
ALABAMA -- 2.3%
Jasper, Waterworks & Sewer
Board RB, AMBAC
5.050%, 06/01/01 $ 50 $ 52
Mobile County GO
6.050%, 02/01/01 65 68
--------
120
--------
ALASKA -- 2.6%
Anchorage, Hospital RB, Sisters of
Providence Project
6.750%, 10/01/01 125 135
--------
ARIZONA -- 5.2%
Arizona State Educational Marketing
Loan Review RB, Series A, MBIA
6.900%, 09/01/00 265 275
--------
COLORADO -- 3.6%
Colorado State Housing Finance
Authority GO, Series A
6.900%, 05/01/01 185 191
--------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
32
<PAGE>
THE ACHIEVEMENT FUNDS
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
DISTRICT OF COLUMBIA -- 1.9%
District of Columbia, Georgetown
University RB, MBIA
3.750%, 04/01/99 $100 $ 100
--------
HAWAII -- 9.9%
Hawaii State GO, Series C, FGIC
6.000%, 03/01/01 500 526
--------
ILLINOIS -- 6.0%
Illinois State Tax Increment RB,
Hoffman Estates
6.500%, 05/15/01 300 316
--------
INDIANA -- 6.2%
Indiana State Educational Facility
Authority RB, University of
Evansville Project
8.125%, 11/01/10 300 330
--------
KANSAS -- 6.7%
Colby, Health Facility RB, Citizens
Medical Center
4.450%, 08/15/02 355 354
--------
MARYLAND -- 9.6%
Prince George County, Public
Improvements GO, Series A, MBIA
5.100%, 03/01/00 500 511
--------
MISSISSIPPI -- 6.8%
Mississippi State Higher
Education RB, Series B
6.100%, 07/01/01 350 361
--------
NEBRASKA -- 2.0%
Nebraska State Building Lease RB,
Data Processing Center
5.800%, 06/15/01 100 105
--------
NEVADA -- 1.7%
Nevada State Housing Division RB,
Single Family Program, Series A-1
5.200%, 10/01/01 90 92
--------
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
NEW MEXICO -- 2.2%
Santa Fe, Municipal Recreational
Facility RB
4.600%, 12/01/01 $115 $ 115
--------
NEW YORK -- 9.7%
New York State Thruway Authority RB,
Local Highway & Bridges
Services Contract
5.000%, 04/01/01 500 514
--------
OHIO -- 2.0%
Montgomery County GO,
Issue I, Series A
6.750%, 09/01/10 100 108
--------
PENNSYLVANIA -- 5.3%
Pennsylvania State GO
9.000%, 10/01/00 190 192
9.000%, 10/01/01 90 91
--------
283
--------
SOUTH CAROLINA -- 9.7%
Pickens County, School
District GO, FGIC
5.250%, 05/01/00 500 512
--------
TEXAS -- 2.7%
Dallas, Housing RB, Corporate
Capital Projects
7.450%, 08/01/00 140 145
--------
WASHINGTON -- 4.9%
Washington State Public Power
Supply RB, Nuclear Project # 1,
Series B
5.000%, 07/01/01 250 259
--------
TOTAL MUNICIPAL BONDS
(Cost $5,294) 5,352
--------
TOTAL INVESTMENTS -- 101.0%
(Cost $5,294) 5,352
--------
OTHER ASSETS AND LIABILITIES,
NET -- (1.0%) (55)
--------
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
33
<PAGE>
JANUARY 31, 1999
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 482,672 outstanding
shares of beneficial interest $4,727
Portfolio Shares of Retail Class A
(unlimited authorization --
no par value) based on 48,018
outstanding shares of beneficial
interest 487
Undistributed net investment income 1
Accumulated net realized gain on
investments 24
Net unrealized appreciation on
investments 58
--------
TOTAL NET ASSETS-- 100.0% $5,297
========
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE --
INSTITUTIONAL CLASS $9.98
========
NET ASSET VALUE AND REDEMPTION PRICE
PER SHARE -- RETAIL CLASS A $10.02
========
MAXIMUM OFFERING PRICE PER SHARE --
RETAIL CLASS A ($10.02 / 98.5 $10.17
========
- ------------------------------------------------------
AMBAC -- AMERICAN MUNICIPAL BOND ASSURANCE CORPORATION
FGIC -- FINANCIAL GUARANTY INSURANCE CORPORATION
GO -- GENERAL OBLIGATION
MBIA -- MUNICIPAL BOND INVESTORS ASSURANCE
RB -- REVENUE BOND
- --------------------------------------------------------
IDAHO MUNICIPAL BOND FUND
- --------------------------------------------------------
[PIE CHART OMITTED]
Plot points are as follows:
Cash Equivalents 1.2%
Revenue Bonds 41.4%
General Obligations 57.4%
% of Total Portfolio Investments
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
MUNICIPAL BONDS -- 99.4%
IDAHO -- 92.6%
Ada & Canyon Counties, Joint School
District # 2, Meridian GO
5.500%, 07/30/04 $ 500 $ 549
5.350%, 07/30/05 750 824
5.500%, 07/30/05 205 227
5.500%, 07/30/05 270 299
5.625%, 07/30/05 500 557
5.500%, 07/30/16 500 549
Ammon, Urban Renewal Agency RB,
Series B
6.000%, 08/01/14 125 134
Bannock County, School
District # 25,
Pocatello GO, FGIC
5.250%, 08/01/15 500 521
Bingham County, School
District # 055,
Blackfoot GO, MBIA
5.650%, 08/01/15 560 594
Boise City RB
5.100%, 02/01/11 500 525
Boise City, Airport RB,
Package Facility Project,
Series A, AMBAC
5.400%, 08/01/11 1,000 1,064
Boise City, Independent School
District # 1 GO, AMBAC
5.400%, 07/30/14 500 521
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
34
<PAGE>
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
IDAHO (CONTINUED)
Boise State University Student
Housing System RB
5.250%, 04/01/17 $ 160 $ 164
Boise State University Idaho RB, FSA
5.000%, 04/01/23 1,000 1,009
Boise, Independent School
District GO
5.375%, 07/30/10 250 271
5.500%, 07/30/16 1,250 1,339
Bonneville & Bingham Counties,
School District #93 GO, FGIC
5.750%, 07/30/07 500 557
5.500%, 07/30/10 850 919
Bonneville County, Jail
Bonds GO, FSA
5.500%, 08/01/16 590 619
Bonneville County, School
District #91, Idaho Falls GO
5.450%, 08/01/08 500 518
5.500%, 08/01/09 300 311
Canyon County, School
District # 131,
Nampa GO, MBIA
5.500%, 07/30/11 500 540
5.500%, 07/30/12 500 540
Canyon County, School
District #132 GO, FSA
5.450%, 07/30/04 470 497
5.400%, 07/30/11 200 214
5.400%, 07/30/12 400 427
5.450%, 07/30/15 900 951
Canyon County, School
District #139 GO
5.200%, 08/01/12 110 116
Cassia & Twin Falls
Counties, Joint
School District
#151 GO, FGIC
5.375%, 08/01/14 1,000 1,050
5.375%, 08/01/16 1,000 1,040
City of Sun Valley GO
5.050%, 08/01/08 195 205
Coeur D'Alene GO, AMBAC
5.350%, 03/01/11 240 250
Elks, Health Facility
Authority RB,
Hospital Rehab Project
5.000%, 07/15/08 250 251
5.125%, 07/15/13 500 496
5.450%, 07/15/23 280 281
Elmore County, School
District #193,
Mountain Home GO, AMBAC
5.000%, 07/31/10 400 421
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
IDAHO (CONTINUED)
Fremont & Madison Counties,
School District # 215,
St. Anthony GO, FSA
5.600%, 08/01/14 $ 125 $ 132
5.600%, 08/01/15 765 808
Gooding & Lincoln Counties,
Joint School District
#231 GO, FSA,
Pre-refunded @ 100
6.250%, 02/01/04 130 145
6.300%, 02/01/04 535 599
Gooding County, School
District # 232,
Wendell GO, AMBAC
5.000%, 08/01/11 100 103
Idaho State Building
Authority RB, MBIA
5.600%, 09/01/05 100 108
5.800%, 09/01/05 100 109
Idaho State Building
Authority RB, Series A
5.000%, 09/01/21 1,150 1,153
Idaho State Health Facility
Authority RB, Magic Valley
Regional Medical Center, AMBAC
5.200%, 12/01/04 250 269
5.625%, 12/01/13 200 215
Idaho State Health Facility
Authority RB, Mercy Medical
Center, Pre-refunded @ 102 (A)
6.200%, 11/15/02 130 144
Idaho State Health Facility
Authority RB, St. Alphonsus
Regional Medical Center,
Pre-refunded @ 102 (A)
6.100%, 12/01/02 100 111
Idaho State Health Facility
Authority RB, St. Joseph's
Regional Medical Center, MBIA
5.000%, 07/01/07 500 538
Idaho State Health Facility
Authority RB, Bannock
Regional Medical Draft
5.250%, 05/01/14 250 252
Idaho State Housing & Finance
Association RB, AMT
6.150%, 01/01/28 1,000 1,056
Idaho State Housing & Finance
Association RB, SFM
4.950%, 07/01/11 365 370
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
35
<PAGE>
JANUARY 31, 1999
STATEMENT OF NET ASSETS
IDAHO MUNICIPAL BOND FUND (CONCLUDED)
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
IDAHO (CONTINUED)
Idaho State Housing and Finance
Association RB, SFM
Mezz Series I-2
5.200%, 07/01/20 $ 500 $ 500
Idaho State University RB,
Student Facility Fee
4.900%, 04/01/17 500 501
Jefferson County, School
District #253 GO, MBIA
5.500%, 08/01/15 240 254
Jerome, Lincoln & Gooding
Counties GO
5.000%, 07/31/12 290 297
Kootenai County, Consolidated
Free Library District GO, FSA
5.000%, 08/01/06 160 172
Kootenai County, Idaho
School District #273 GO, AMBAC
5.000%, 07/30/17 170 171
Latah & Clearwater Counties,
School District #286 GO, AMBAC
5.500%, 02/01/07 200 209
5.600%, 02/01/08 200 209
Lewis-Clark State College,
Refunding Improvements RB
5.200%, 04/01/17 250 256
Madison County GO, FSA
5.400%, 08/01/15 420 437
Madison County, Idaho Memorial
Hospital Board RB
5.000%, 12/01/18 250 247
McCall, Water RB, Parity Lien, FSA
5.750%, 03/01/07 215 242
5.850%, 03/01/16 500 551
Meridian GO, FSA
5.000%, 08/01/15 290 301
Nez Perce County, Pollution
Control RB, Potlatch
Corporation Project
6.000%, 10/01/24 1,000 1,076
Oneida County, School
District #351 GO, MBIA
5.000%, 07/31/15 375 385
Payette County, School
District #372 GO
6.250%, 07/30/10 365 432
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
IDAHO (CONTINUED)
Payette County, School District
# 372 GO, Asset Guaranty,
Pre-refunded @ 100
6.750%, 07/31/03 $ 100 $ 113
Southern Idaho Regional Solid
Waste Project COP
5.450%, 11/01/13 500 525
Teton County, School
District #401
GO, FSA
5.300%, 08/01/07 225 245
5.500%, 08/01/10 400 439
Twin Falls & Cassia Counties,
Joint School District
#418 GO, MBIA
5.450%, 08/01/15 145 152
Twin Falls County,
School District #413 GO,
Class A, AMBAC
5.250%, 07/30/09 200 211
5.250%, 07/30/13 400 415
5.250%, 07/30/14 420 434
Twin Falls County,
School District
#415 GO, Asset Guaranty
5.500%, 08/01/15 195 206
University of Idaho,
Refunding &
Improvements RB
5.100%, 04/01/07 200 209
University of Idaho,
Student Fee RB
5.350%, 04/01/10 250 260
6.500%, 04/01/15 865 1,022
5.650%, 04/01/22 500 539
University of Idaho,
Student Fee RB, FSA
5.850%, 04/01/11 500 553
--------
37,025
--------
PUERTO RICO -- 6.8%
Puerto Rico Commonwealth GO
5.750%, 07/01/17 250 270
Puerto Rico Commonwealth Highway
and Transportation Authority
Highway RB
6.250%, 07/01/13 400 480
6.250%, 07/01/16 735 880
Puerto Rico Municipal Finance
Agency RB, Series A
5.250%, 07/01/10 1,000 1,093
--------
2,723
--------
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
36
<PAGE>
THE ACHIEVEMENT FUNDS
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
TOTAL MUNICIPAL BONDS
(Cost $37,661) $ 39,748
--------
CASH EQUIVALENT -- 1.2%
SEI Tax-Exempt Trust
Tax-Free Portfolio $487 487
--------
TOTAL CASH EQUIVALENT
(Cost $487) 487
--------
TOTAL INVESTMENTS -- 100.6%
(Cost $38,148) 40,235
--------
OTHER ASSETS AND LIABILITIES, NET -- (0.6%) (233)
--------
NET ASSETS:
Portfolio Shares of Institutional
Class (unlimited authorization
-- no par value) based on
2,471,935 outstanding shares of
beneficial interest 25,298
Portfolio Shares of Retail Class A
(unlimited authorization -- no
par value) based on 1,069,639
outstanding shares of beneficial
interest 11,257
Portfolio Shares of Retail Class B
(unlimited authorization -- no
par value) based on 122,996
outstanding shares of beneficial
interest 1,331
Undistributed net investment income 1
Accumulated net realized gain on
investments 28
Net unrealized appreciation on
investments 2,087
--------
TOTAL NET ASSETS -- 100.0% $40,002
========
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE --
INSTITUTIONAL CLASS $10.91
========
NET ASSET VALUE AND REDEMPTION PRICE
PER SHARE -- RETAIL CLASS A $10.93
========
MAXIMUM OFFERING PRICE PER SHARE --
RETAIL CLASS A ($10.93 / 96%) $11.39
========
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE --
RETAIL CLASS B $10.94
========
- ------------------------------------------------------
(A) PRE-REFUNDED SECURITY. THE PRE-REFUNDED DATE IS
SHOWN AS THE MATURITY DATE ON THE STATEMENT
OF NET ASSETS.
AMBAC -- AMERICAN MUNICIPAL BOND ASSURANCE
COMPANY AMT -- ALTERNATIVE MINIMUM TAX
FGIC -- FEDERAL GUARANTY INSURANCE CORPORATION
FSA -- FINANCIAL SECURITY ASSURANCE
GO -- GENERAL OBLIGATION
MBIA -- MUNICIPAL BOND INSURANCE ASSOCIATION
RB -- REVENUE BOND
SFM -- SINGLE FAMILY MORTGAGE
- ------------------------------------------------------
MUNICIPAL BOND FUND
- ------------------------------------------------------
[PIE CHART OMITTED]
Plot points are as follows:
General Obligations 6.9%
Cash Equivalents 9.1%
Revenue Bonds 84.0%
% of Total Portfolio Investments
- --------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------
MUNICIPAL BONDS -- 93.1%
ALABAMA -- 0.2%
Alabama State Housing Finance
Authority RB, Series B, AMT, GNMA
6.100%, 10/01/20 $ 120 $ 126
--------
ALASKA -- 6.2%
Alaska State Housing
Finance RB, MBIA
6.100%, 12/01/37 370 391
Alaska State Housing
Finance RB, Series A, GO
5.700%, 12/01/29 500 518
Alaska State Student Loan RB,
Series A, AMBAC
5.750%, 07/01/14 400 417
Alaska State Veterans Housing
RB, 1st Series, GNMA
5.400%, 12/01/23 415 420
Valdez, Marine Term RB,
Mobil Pipeline Project
5.750%, 11/01/28 1,000 1,034
Valdez, Marine Term RB, Mobil
Pipeline Project, Series A
5.850%, 08/01/25 1,000 1,039
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
37
<PAGE>
JANUARY 31, 1999
STATEMENT OF NET ASSETS
MUNICIPAL BOND FUND (CONTINUED)
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
ALASKA (CONTINUED)
Valdez, Marine Term RB, Mobil
Pipeline Project, Series B
5.500%, 10/01/28 $1,000 $ 1,020
--------
4,839
--------
ARIZONA -- 1.2%
Maricopa County, Health Facilities
Authority RB, Catholic
Healthcare West Project
5.000%, 07/01/16 400 399
Maricopa County, Elementary
School District # 068 GO,
Alhambra, AMBAC
5.100%, 07/01/11 500 524
--------
923
--------
ARKANSAS -- 1.4%
Arkansas State Student Loan
Authority RB
7.250%, 06/01/09 500 579
Independence County, Pollution
Control RB, Power & Light Project
6.250%, 01/01/21 500 536
--------
1,115
--------
CALIFORNIA -- 3.4%
California State Tri-City Hospital
District RB, Series A, MBIA
5.625%, 02/15/17 1,010 1,088
Los Angeles, Wastewater System
RB, Series A
5.875%, 06/01/24 160 173
Northern California Power Agency RB,
AMBAC, Pre-refunded @ 100 (A)
7.500%, 07/01/21 530 709
Sacramento, Municipal Utility
RB, Serial E, AMBAC
5.750%, 05/15/22 130 138
San Francisco, Airport Improvement
RB, United Airlines, ETM
8.000%, 07/01/13 290 369
San Francisco, City & County RB,
Series A, GNMA
7.125%, 10/01/16 130 143
--------
2,620
--------
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
COLORADO -- 1.4%
Colorado State Board of
Agriculture RB, University
of Southern Colorado
8.250%, 05/01/03 $ 100 $ 101
Denver,
City & County RB, The Boston
Loft Project, Series A, AMT,
FHA
5.750%, 10/01/27 500 518
Summit County, Sports
Facilities RB,
Keystone Resorts Project
7.375%, 09/01/10 420 506
--------
1,125
--------
CONNECTICUT -- 1.1%
Connecticut State, Health
& Educational Facilities
Authority RB, Trinity
College, Series E, MBIA
5.875%, 07/01/26 155 170
Connecticut State, Health & Elder
Facility Revenue New Britain
General Hospital, Series
B, Loc: AMBAC
6.000%, 07/01/24 115 125
Waterbury, Housing Authority RB,
Section 8, Project A, GNMA
5.850%, 02/01/37 500 531
--------
826
--------
DISTRICT OF COLUMBIA -- 0.2%
District of Columbia Housing Finance
RB, Congress Park II Apartments,
MBIA (B)
0.000%, 11/01/25 2,255 151
--------
FLORIDA -- 1.9%
Boynton Beach, Housing RB, Clipper
Cove Apartments
6.450%, 01/01/27 505 555
Florida State Housing Finance
Agency RB, Glen Oaks Apartment
Project, AMT, FNMA
5.900%, 02/01/30 500 529
Florida State University Housing
Facility RB, MBIA
5.875%, 05/01/14 100 108
Largo, Suncoast Health
System RB, GOH
6.200%, 03/01/13 295 298
--------
1,490
--------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
38
<PAGE>
The Achievement Funds
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
GEORGIA -- 2.4%
Georgia State Housing &
Finance Authority RB,
Homeownership Opportunity
Program, Series C, FHA
6.500%, 12/01/11 $ 310 $ 331
Georgia State Housing &
Finance Authority RB,
Subseries B2, AMT
5.850%, 12/01/28 1,000 1,044
Smyra, Hospital Authority RB,
Ridgeview Institute Project
6.000%, 11/01/28 500 502
--------
1,877
--------
HAWAII -- 1.0%
Hawaii State Department of
Budget & Finance RB,
Wahawa General
Hospital Project
7.500%, 07/01/12 250 272
Hawaii State Housing Finance &
Development RB, Series A,
FNMA, AMT
5.750%, 07/01/30 500 520
--------
792
--------
IDAHO -- 1.4%
Idaho State Health Facilities
Authority RB, Bannock Regional
Medical Center Project
6.125%, 05/01/25 465 497
Nez Perce County, Pollution
Control RB, Potlatch
Corporation Project
6.000%, 10/01/24 545 587
--------
1,084
--------
ILLINOIS -- 5.7%
Bryant, Pollution Control RB,
Central Illinois
Light Company
5.900%, 08/01/23 1,000 1,049
Chicago, Board of Education
GO, MBIA
6.000%, 12/01/26 150 165
Chicago, Housing RB, Bryne
Mawr/Belle Project,
AMT, GNMA
6.125%, 06/01/39 500 542
Illinois State Housing
Development Authority
RB, Section 8, HUD
7.000%, 07/01/17 145 147
Illinois State, Sales Tax
RB, Series P
6.500%, 06/15/22 255 306
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
ILLINOIS (CONTINUED)
Illinois State Toll Highway
Priority RB, Series A, FGIC
6.200%, 01/01/16 $1,000 $ 1,109
Rockford, Faust Landmark
Apartments RB,
Series A, MBIA
6.750%, 01/01/18 1,000 1,117
--------
4,435
--------
INDIANA -- 1.9%
Ball State University
Student Fee RB,
Series G, FGIC,
Pre-refunded @ 102, (A)
6.125%, 07/01/02 500 541
Hammond, Multi-School
Building RB, FGIC
6.125%, 07/15/19 720 777
Indiana State Toll Financial
Authority RB
6.000%, 07/01/13 25 25
Petersburg, Pollution Control
RB, Indianapolis Power
& Light
6.625%, 12/01/24 105 119
--------
1,462
--------
IOWA -- 2.3%
Iowa City, Sewer RB, MBIA
5.750%, 07/01/21 1,000 1,064
Iowa State Finance Authority
RB, Series F, GNMA
5.700%, 01/01/27 500 518
Iowa State Hospital Facility
RB, Series N, FSA
6.250%, 02/15/22 200 214
--------
1,796
--------
KENTUCKY -- 0.8%
Kentucky State Economic
Development RB, Appalachian
Hospital System
5.875%, 10/01/22 500 519
University of Louisville
Consolidated Educational
Building RB, Series H
5.875%, 05/01/11 100 106
--------
625
--------
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
39
<PAGE>
JANUARY 31, 1999
Statement of Net Assets
Municipal Bond Fund (continued)
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
LOUISIANA -- 1.3%
Louisiana State, Stadium &
Expo District RB,
Series B, FGIC
5.000%, 07/01/26 $1,000 $ 985
--------
MAINE -- 1.3%
Maine State Housing Authority
RB, Series D2, AMT
5.900%, 11/15/25 1,000 1,040
--------
MASSACHUSETTS -- 0.3%
Massachusetts State Health &
Educational Facilities
Authority RB, Melrose-
Wakefield Hospital,
Series B, ETM, GOH
5.875%, 07/01/18 200 227
--------
MICHIGAN -- 0.1%
Michigan State Housing
Development Authority
RB, FHA
5.700%, 07/01/06 115 115
--------
MISSOURI -- 2.5%
Boone County, Waterworks
System RB, Public Water
Supply District No. 07
5.500%, 05/01/29 1,000 1,000
Missouri State Health &
Education Facilities RB,
SSM Health Care
Projects, Series B,
ETM, MBIA
7.000%, 06/01/15 650 722
Springfield, Public Building
Leasehold RB, FSA
5.900%, 11/01/14 200 222
--------
1,944
--------
NEVADA -- 2.0%
Nevada State GO, Project
# 32, ETM
7.000%, 08/01/10 1,000 1,069
Nevada State Housing Division
RB, Issue C-1, FHA
6.500%, 10/01/16 200 212
Nevada State Housing Division
RB, Saratoga Palms, AMT,
E172 FNMA
6.250%, 10/01/16 280 302
--------
1,583
--------
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
NEW JERSEY -- 0.2%
New Jersey State Health
Care Facility
Financing Authority RB,
Raritan Bay Center
7.250%, 07/01/27 $ 140 $ 148
--------
NEW MEXICO -- 1.5%
Carlsbad, Housing RB,
Colonial Hillcrest
7.375%, 08/01/27 375 398
Rio Rancho, Water and
Waste RB, FSA
6.000%, 05/15/22 315 344
Southeastern New Mexico
Affordable
Housing RB, Casa
Hermosa Apartments
7.250%, 12/01/27 430 455
--------
1,197
--------
NEW YORK -- 8.0%
New York City Industrial
Development Agency RB
11.250%, 07/01/04 400 435
New York State Dorm Authority
RB, FHA
6.000%, 08/01/36 875 950
New York State Dorm Authority
RB, Menorah Campus, FHA
6.100%, 02/01/37 1,000 1,094
New York State Ideal Senior
Living Center Housing
RB, FHA
5.900%, 08/01/26 500 527
New York State Local
Government Assistance
RB, Series A, GO
6.000%, 04/01/24 280 308
New York State Medical Care
Facilities RB,
Series E, MBIA
6.500%, 08/15/24 100 112
New York State Metropolitan
Transit Authority RB,
Series C1
5.625%, 07/01/27 1,000 1,050
New York State Unrefunded
Balance GO, Series E
6.000%, 08/01/26 170 185
Newark-Wayne, Community
Hospital RB
7.600%, 09/01/15 500 548
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
40
<PAGE>
THE ACHIEVEMENT FUNDS
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
NEW YORK (CONTINUED)
United Nations Development
RB, Series B
5.600%, 07/01/26 $1,000 $ 1,005
--------
6,214
--------
NORTH CAROLINA -- 2.2%
North Carolina State Eastern
Municipal Power Agency
RB, Series A, ETM
4.000%, 01/01/18 375 334
North Carolina State Eastern
Municipal Power Agency RB,
Catawba Electric, Series B
6.000%, 01/01/20 660 666
North Carolina State Eastern
Municipal Power Agency RB,
Series A, Pre-refunded
@ 100 (A)
6.000%, 01/01/22 580 676
--------
1,676
--------
NORTH DAKOTA -- 1.2%
Fargo, Housing RB
7.125%, 02/01/26 255 260
North Dakota State Housing
Finance Agency RB,
Series C, AMT
5.950%, 07/01/17 270 288
6.100%, 07/01/28 350 367
--------
915
--------
OHIO -- 6.9%
Akron Bath Copley, Joint
Township Hospital Facilities
RB, Series A, Suma Hospital
5.375%, 11/15/24 750 727
Butler County, Hospital
Facility RB,
Middletown Hospital
5.000%, 11/15/28 500 481
Erie County, Franciscan
Service RB,
Providence Hospital
6.000%, 01/01/13 1,000 1,056
Johnstown, Waterworks
System RB
6.000%, 12/01/17 250 261
Mason, Tax Increment Fing RB,
J. W. Harris Development
Project
5.300%, 12/01/18 600 600
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
OHIO (CONTINUED)
Montgomery County, Hospital
RB, Grandview Hospital &
Medical Center
5.250%, 12/01/00 $ 675 $ 656
Montgomery County, Special
Assessment RB, Montgomery
Woods Project
6.000%, 12/01/17 76 84
Oak Hills, Local School
District GO, Series A
5.700%, 12/01/25 500 544
Perrysburg, School District
GO, Exempt Village
School District
5.350%, 12/01/25 400 414
Wyoming, School District GO
5.250%, 12/01/22 500 507
--------
5,330
--------
OKLAHOMA -- 0.7%
Oklahoma State Industrial
Authority RB, Deaconess
Health Care, Series A
5.750%, 10/01/17 500 514
--------
PENNSYLVANIA -- 8.0%
Allentown, Hospital Authority
RB, Sacred Heart Hospital of
Allentown, Series A
6.750%, 11/15/14 500 543
Dauphin County, General
Authority Office RB,
Forum Pl, Series A
6.000%, 01/15/25 500 507
Delaware County, Hospital
Authority RB, Crozer-Chester
Medical Center
6.000%, 12/15/20 500 522
Monroeville, Hospital RB
6.250%, 10/01/15 1,000 887
Pennsylvania State GO
9.000%, 10/01/00 100 101
Pennsylvania State Housing
Finance Agency RB,
Series 39B
6.875%, 10/01/24 750 804
Pennsylvania State Housing
Finance Agency RB,
Series 59A, AMT
5.800%, 10/01/29 1,250 1,294
Scranton-Lackawanna, Health &
Welfare Authority RB, Moses
Taylor Hospital Project
6.250%, 07/01/20 500 526
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
41
<PAGE>
JANUARY 31, 1999
Statement of Net Assets
Municipal Bond Fund (continued)
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
PENNSYLVANIA (CONTINUED)
Warren County, Hospital
Authority RB, Series A
6.900%, 04/01/11 $ 500 $ 553
Washington County, Canonsburg
General Hospital
Authority RB
7.350%, 06/01/13 500 521
--------
6,258
--------
PUERTO RICO -- 1.4%
Puerto Rico Commonwealth GO
5.750%, 07/01/17 1,000 1,079
--------
RHODE ISLAND -- 1.5%
Rhode Island State, Convention
Center Authority RB,
Series A, AMBAC
5.750%, 05/15/20 150 160
Rhode Island State Housing &
Mortgage Finance RB,
Series 23, AMT
5.950%, 04/01/29 1,000 1,043
--------
1,203
--------
SOUTH CAROLINA -- 3.0%
Piedmont, Municipal Power
Agency RB, Series A
5.750%, 01/01/24 1,185 1,186
South Carolina State
Connector 2000 Association
RB, Toll Road Project, (B)
0.000%, 01/01/31 500 75
University of South Carolina
RB, MBIA
5.750%, 06/01/26 1,000 1,076
--------
2,337
--------
SOUTH DAKOTA -- 0.7%
South Dakota State Health &
Education Facilities RB,
Huron Regional
Medical Center
7.250%, 04/01/20 500 551
--------
TEXAS -- 3.2%
Beaumont, Multi-Family Housing
RB, Park Shadows Project, FHA
6.450%, 06/15/22 500 541
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
TEXAS (CONTINUED)
Socorro, Independent School
District GO
5.750%, 02/15/21 $ 200 $ 223
Denison, Hospital Authority
RB, Texoma Medical
Center Project
6.125%, 08/15/17 700 718
Frisco, Independent School
District GO, PSFG
5.400%, 08/15/23 270 276
Harris County, Industrial
Development RB, Gatx
Terminals Project
6.950%, 02/01/22 500 542
Texarkana, Health Facilities
RB, Wadley Regional
Medical Center,
Series B, MBIA
6.000%, 10/01/17 160 182
--------
2,482
--------
UTAH -- 3.0%
Provo City, Housing Authority
RB, Lookout Pointe
Apartments, GNMA
5.800%, 07/20/22 500 524
Salt Lake City, Water RB, FGIC
4.100%, 08/01/04 275 238
Salt Lake County, Westminster
College Project RB
5.750%, 10/01/27 250 257
Utah State Housing Finance
Agency RB, FHA
6.800%, 01/01/12 200 212
Weber County, Municipal
Building Authority RB, MBIA
5.750%, 12/15/19 1,000 1,078
--------
2,309
--------
VERMONT -- 1.8%
Vermont State Housing
Finance Agency RB,
Series 9, AMT, MBIA
6.000%, 05/01/37 365 383
Vermont State Student
Assistance Financing RB,
Series B, AMT, FSA
6.700%, 12/15/12 900 993
--------
1,376
--------
WASHINGTON -- 3.8%
King County, GO, MBIA
6.125%, 01/01/33 110 119
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
42
<PAGE>
The Achievement Funds
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
WASHINGTON (CONTINUED)
Pilchuck Dev. Pub. Corp.
WA. RB
6.000%, 08/01/23 $ 820 $ 854
Seattle, Low Income Housing
Assistance Authority RB,
Kin On Project, Series A,
GNMA
7.400%, 11/20/36 1,000 1,166
Snohomish County, Public
Utility RB, District
# 001, FGIC
6.000%, 01/01/18 220 235
Stevens County, Water Power
RB, Kettle Project
6.000%, 12/01/23 110 116
Washington State Health Care
Facilities Authority RB,
Sweedish Health System,
AMBAC
5.500%, 11/15/13 200 217
Washington State, Housing
Finance RB, Seattle University
Auxiliary Services Project,
BANKAM
5.300%, 07/01/31 250 251
--------
2,958
--------
WEST VIRGINIA -- 0.2%
West Virginia State, Hospital
Financing Authority RB,
Fairmont General Hospital,
GOH
6.750%, 03/01/14 140 153
--------
WISCONSIN -- 3.1%
Wisconsin State GO,
Series D, AMT
5.800%, 05/01/20 145 156
Wisconsin State Health &
Education Facilities RB,
Franciscan Skemp
Medical Center
6.125%, 11/15/15 1,000 1,090
Wisconsin State Health &
Education Facilities RB,
Hess Memorial
Hospital Association
7.875%, 11/01/22 500 573
Wisconsin State Housing &
Economic Development RB,
Series A, GO
6.000%, 09/01/15 550 580
--------
2,399
--------
- ---------------------------------------------------------
FACE MARKET
DESCRIPTION AMOUNT (000) VALUE (000)
- ---------------------------------------------------------
WYOMING -- 2.7%
Jackson, National Rural
Utilities RB, Gas Supply,
Series B, AMT
5.875%, 05/01/26 $ 500 $ 529
Wyoming State Community
Development Authority RB,
Series 4, AMT
5.850%, 06/01/28 485 510
Wyoming State Community
Development Authority
RB, Series A, FHA
6.000%, 06/01/23 1,000 1,044
--------
2,083
--------
TOTAL MUNICIPAL BONDS
(Cost $70,584) 72,362
--------
MUTUAL FUNDS -- 3.0%
Greenwich Street Municipal
Fund 50,000 538
Managed Municipals Portfolio
Fund 55,000 615
Morgan Stanley Dean Witter
Municipal Income II 25,000 236
Morgan Stanley Dean Witter
Municipal Premium Income 50,000 459
Nuveen Municipal Value Fund 50,000 491
--------
TOTAL MUTUAL FUNDS
(Cost $2,305) 2,339
--------
CASH EQUIVALENTS -- 6.3%
SEI Institutional
Tax-Free Portfolio 3,028 3,028
SEI Tax-Free Portfolio 1,831 1,831
--------
TOTAL CASH EQUIVALENTS
(Cost $4,859) 4,859
--------
TOTAL INVESTMENTS -- 102.4%
(Cost $77,748) 79,560
--------
OTHER ASSETS AND LIABILITIES, NET-- (2.4%) (1,860)
--------
(CONTINUED)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
43
<PAGE>
JANUARY 31, 1999
Statement of Net Assets
Municipal Bond Fund (concluded)
- ---------------------------------------------------------
MARKET
DESCRIPTION VALUE (000)
- ---------------------------------------------------------
NET ASSETS:
Portfolio Shares of Institutional Class
(unlimited authorization-- no par value)
based on 6,625,899 outstanding
shares of beneficial interest $ 66,565
Portfolio Shares of Retail Class A
(unlimited authorization -- no par value)
based on 701,952 outstanding shares
of beneficial interest 6,936
Portfolio Shares of Retail Class B
(unlimited authorization -- no par value)
based on 217,061 outstanding shares
of beneficial interest 2,248
Undistributed net investment income 13
Accumulated net realized gain on investments 126
Net unrealized appreciation on investments 1,812
--------
TOTAL NET ASSETS-- 100.0% $77,700
=======
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE-- INSTITUTIONAL CLASS $10.30
=======
NET ASSET VALUE AND REDEMPTION PRICE
PER SHARE -- RETAIL CLASS A $10.29
=======
MAXIMUM OFFERING PRICE PER SHARE --
RETAIL CLASS A ($10.29 / 96%) $10.72
=======
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE RETAIL CLASS B $10.30
=======
- ---------------------------------------------------------
(A) PRE-REFUNDED SECURITY. THE PRE-REFUNDED DATE IS SHOWN
AS THE MATURITY DATE ON THE STATEMENT OF NET ASSETS.
(B) ZERO COUPON SECURITY
AMBAC -- AMERICAN MUNICIPAL BOND ASSURANCE CORPORATION
AMT -- ALTERNATIVE MINIMUM TAX
BANKAM -- BANK OF AMERICA
ETM -- ESCROWED TO MATURITY
FGIC -- FINANCIAL GUARANTY INSURANCE CORPORATION
FHA -- FEDERAL HOUSING AUTHORITY
FSA -- FINANCIAL SECURITY ASSURANCE
GNMA -- GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
GO -- GENERAL OBLIGATION
GOH -- GENERAL OBLIGATION OF HOSPITAL
HUD -- DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
MBIA -- MUNICIPAL BOND INSURANCE ASSOCIATION
PSFG -- PERMANENT SCHOOL FUND GUARANTEED
RB -- REVENUE BOND
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
44
<PAGE>
<TABLE>
<CAPTION>
FOR THE YEAR ENDED JANUARY 31, 1999 The Achievement Funds
Statements of Operations (000)
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 $ 2,617 $ 1,539 $ -- $ -- $ -- $ -- $ --
Interest Income 306 4,151 10,749 2,867 589 1,891 3,995
------- ------- ------- ------ ---- ------ ------
Total Income 2,923 5,690 10,749 2,867 589 1,891 3,995
------- ------- ------- ------ ---- ------ ------
EXPENSES:
Administrative Fees 471 375 333 94 100 100 144
Less: Waiver of Administrative Fees -- -- -- -- (73) (26) --
Investment Advisory Fees 1,743 1,386 997 275 81 222 433
Less: Waiver of Investment
Advisory Fees (372) (283) (272) (117) (74) (95) (141)
Custodian/Transfer Agent Fees 55 51 52 47 54 46 47
Professional Fees 50 41 37 11 2 8 15
Pricing Fees 9 8 7 2 1 2 3
Registration & Filing Fees 60 49 45 13 4 10 19
Printing Fees 38 31 28 8 2 6 12
Trustee Fees 14 12 11 3 1 2 4
Distribution Fees - Retail A 27 10 6 -- 1 26 22
Distribution Fees - Retail B (1) 11 6 -- -- -- 6 10
Interest and Other Expenses 2 1 1 -- -- -- 1
Amortization of Deferred
Organizational Costs 11 12 7 8 3 3 3
------- ------- ------- ------ ---- ------ ------
Total Expenses 2,119 1,699 1,252 344 102 310 572
------- ------- ------- ------ ---- ------ ------
Net Income 804 3,991 9,497 2,523 487 1,581 3,423
------- ------- ------- ------ ---- ------ ------
Net Realized Gain (Loss) on
Investments 7,176 4,336 631 (37) 51 175 1,093
Net Change in Unrealized
Appreciation (Depreciation)
of Investments 47,621 22,563 1,632 (113) (92) 304 (428)
------- ------- ------- ------ ---- ------ ------
Net Realized and Unrealized Gain
(Loss) on Investments 54,797 26,899 2,263 (150) (41) 479 665
------- ------- ------- ------ ---- ------ ------
Increase in Net Assets Resulting
from Operations $55,601 $30,890 $11,760 $2,373 $446 $2,060 $4,088
======= ======= ======= ====== ==== ====== ======
<FN>
(1) COMMENCED OPERATIONS ON MAY 8, 1998.
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0. THE
ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
45
<PAGE>
</FN>
</TABLE>
<TABLE>
<CAPTION>
Statements of Changes in Net Assets (000) THE ACHIEVEMENT FUNDS
- ------------------------------------------------------------------------------------------------------------------------------------
EQUITY BALANCED INTERMEDIATE
FUND FUND TERM BOND FUND
================== ================== ===================
2/1/98 2/1/97 2/1/98 2/1/97 2/1/98 2/1/97
TO TO TO TO TO TO
1/31/99 1/31/98 1/31/99 1/31/98 1/31/99 1/31/98
-------- -------- -------- -------- -------- --------
INVESTMENT ACTIVITIES:
<S> <C> <C> <C> <C> <C> <C>
Net Investment Income $ 804 $ 1,200 $ 3,991 $ 4,203 $ 9,497 $ 8,872
Net Realized Gain (Loss) on Investments 7,176 18,358 4,336 10,936 631 (389)
Net Change in Unrealized
Appreciation (Depreciation) of Investments 47,621 19,189 22,563 11,733 1,632 4,245
-------- -------- -------- -------- -------- --------
Increase in Net Assets
Resulting From Operations 55,601 38,747 30,890 26,872 11,760 12,728
-------- -------- -------- -------- -------- --------
DISTRIBUTIONS TO SHAREHOLDERS:
Net Investment Income:
Institutional Class (898) (1,184) (3,959) (3,878) (9,367) (8,727)
Retail Class A (20) (26) (81) (67) (129) (146)
Retail Class B (1) (1) -- (7) -- -- --
Capital Gains:
Institutional Class (10,727) (20,133) (11,946) (8,323) -- --
Retail Class A (476) (852) (260) (176) -- --
Retail Class B (1) (80) -- (73) -- -- --
-------- -------- -------- -------- -------- --------
Total Distributions (12,202) (22,195) (16,326) (12,444) (9,496) (8,873)
-------- -------- -------- -------- -------- --------
CAPITAL SHARE TRANSACTIONS:
Institutional Class:
Proceeds from Shares Issued 67,365 32,263 26,031 14,194 41,264 44,870
Reinvestment of Cash Distributions 3,277 6,033 15,867 12,192 1,585 1,565
Cost of Shares Redeemed (37,215) (36,401) (16,968) (21,130) (38,279) (23,136)
-------- -------- -------- -------- -------- --------
Total Institutional Class Transactions 33,427 1,895 24,930 5,256 4,570 23,299
-------- -------- -------- -------- -------- --------
Retail Class A:
Proceeds from Shares Issued 3,075 6,827 910 968 903 757
Reinvestment of Cash Distributions 491 843 335 239 126 139
Cost of Shares Redeemed (2,990) (2,194) (1,022) (461) (2,093) (907)
-------- -------- -------- -------- -------- --------
Total Retail Class A Transactions 576 5,476 223 746 (1,064) (11)
-------- -------- -------- -------- -------- --------
Retail Class B (1):
Proceeds from Shares Issued 1,985 -- 1,364 -- -- --
Reinvestment of Cash Distributions 79 -- 80 -- -- --
Cost of Shares Redeemed (76) -- (22) -- -- --
-------- -------- -------- -------- -------- --------
Total Retail Class B Transactions 1,988 -- 1,422 -- -- --
-------- -------- -------- -------- -------- --------
Net Increase (Decrease) in Net
Assets from Share Transactions 35,991 7,371 26,575 6,002 3,506 23,288
-------- -------- -------- -------- -------- --------
Total Increase (Decrease) in Net Assets 79,390 23,923 41,139 20,430 5,770 27,143
NET ASSETS:
Beginning of Period 205,256 181,333 179,620 159,190 164,518 137,375
-------- -------- -------- -------- -------- --------
End of Period $284,646 $205,256 $220,759 $179,620 $170,288 $164,518
======== ======== ======== ======== ======== ========
SHARES ISSUED AND REDEEMED:
Institutional Class
Shares Issued 4,301 2,097 1,965 1,102 3,873 4,313
Shares Issued in Lieu of Cash Distributions 228 388 1,238 950 149 151
Shares Redeemed (2,275) (2,373) (1,257) (1,650) (3,589) (2,228)
-------- -------- -------- -------- -------- --------
Total Institutional Class Share Transactions 2,254 112 1,946 402 433 2,236
-------- -------- -------- -------- -------- --------
Retail Class A
Shares Issued 191 434 67 74 85 72
Shares Issued in Lieu of Cash Distributions 34 54 26 19 12 13
Shares Redeemed (191) (144) (79) (36) (196) (87)
-------- -------- -------- -------- -------- --------
Total Retail Class A Share Transactions 34 344 14 57 (99) (2)
-------- -------- -------- -------- -------- --------
Retail Class B (1)
Shares Issued 121 -- 102 -- -- --
Shares Issued in Lieu of Cash Distributions 6 -- 6 -- -- --
Shares Redeemed (5) -- (2) -- -- --
-------- -------- -------- -------- -------- --------
Total Retail Class B Share Transactions 122 -- 106 -- -- --
-------- -------- -------- -------- -------- --------
Net Increase (Decrease) in Share Transactions 2,410 456 2,066 459 334 2,234
======== ======== ======== ======== ======== ========
</TABLE>
<TABLE>
<CAPTION>
SHORT TERM SHORT TERM IDAHO MUNICIPAL
BOND FUND MUNICIPAL BOND FUND MUNICIPAL BOND BOND FUND
=================== =================== ================== ===================
2/1/98 2/1/97 2/1/98 2/1/97 2/1/98 2/1/97 2/1/98 2/1/97
TO TO TO TO TO TO TO TO
1/31/99 1/31/98 1/31/99 1/31/98 1/31/99 1/31/98 1/31/99 1/31/98
-------- -------- ------- -------- -------- -------- -------- --------
INVESTMENT ACTIVITIES:
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net Investment Income $ 2,523 $ 3,244 $ 487 $ 739 $ 1,581 $ 1,517 $ 3,423 $ 3,175
Net Realized Gain (Loss) on Investments (37) (253) 51 65 175 70 1,093 1,138
Net Change in Unrealized
Appreciation (Depreciation) of Investments (113) 426 (92) 6 304 1,413 (428) 2,226
-------- -------- ------- -------- -------- -------- -------- --------
Increase in Net Assets
Resulting From Operations 2,373 3,417 446 810 2,060 3,000 4,088 6,539
-------- -------- ------- -------- -------- -------- -------- --------
DISTRIBUTIONS TO SHAREHOLDERS:
Net Investment Income:
Institutional Class (2,515) (3,230) (479) (740) (1,139) (1,132) (2,984) (2,761)
Retail Class A (8) (14) (14) (8) (420) (385) (389) (414)
Retail Class B (1) -- -- -- -- (21) -- (37) --
Capital Gains:
Institutional Class -- -- (35) (125) (115) (90) (1,076) (763)
Retail Class A -- -- (2) (2) (52) (34) (126) (116)
Retail Class B (1) -- -- -- -- (5) -- (34) --
-------- -------- ------- -------- -------- -------- -------- --------
Total Distributions (2,523) (3,244) (530) (875) (1,752) (1,641) (4,646) (4,054)
-------- -------- ------- -------- -------- -------- -------- --------
CAPITAL SHARE TRANSACTIONS:
Institutional Class:
Proceeds from Shares Issued 10,145 12,725 593 2,668 9,011 5,810 16,704 16,991
Reinvestment of Cash Distributions 1,135 1,122 1 6 22 24 31 11
Cost of Shares Redeemed (24,033) (28,495) (11,322) (8,830) (8,364) (8,204) (11,037) (9,182)
-------- -------- ------- -------- -------- -------- -------- --------
Total Institutional Class Transactions (12,753) (14,648) (10,728) (6,156) 669 (2,370) 5,698 7,820
-------- -------- ------- -------- -------- -------- -------- --------
Retail Class A:
Proceeds from Shares Issued 42 122 400 65 3,022 4,939 851 7,604
Reinvestment of Cash Distributions 7 9 14 10 465 385 514 530
Cost of Shares Redeemed (104) (370) (154) (79) (1,167) (1,901) (4,024) (3,430)
-------- -------- ------- -------- -------- -------- -------- --------
Total Retail Class A Transactions (55) (239) 260 (4) 2,320 3,423 (2,659) 4,704
-------- -------- ------- -------- -------- -------- -------- --------
Retail Class B (1):
Proceeds from Shares Issued -- -- -- -- 1,419 -- 2,195 --
Reinvestment of Cash Distributions -- -- -- -- 15 -- 68 --
Cost of Shares Redeemed -- -- -- -- (103) -- (15) --
-------- -------- ------- -------- -------- -------- -------- --------
Total Retail Class B Transactions -- -- -- -- 1,331 -- 2,248 --
-------- -------- ------- -------- -------- -------- -------- --------
Net Increase (Decrease) in Net
Assets from Share Transactions (12,808) (14,887) (10,468) (6,160) 4,320 1,053 5,287 12,524
-------- -------- ------- -------- -------- -------- -------- --------
Total Increase (Decrease) in Net Assets (12,958) (14,714) (10,552) (6,225) 4,628 2,412 4,729 15,009
NET ASSETS:
Beginning of Period 51,057 65,771 15,849 22,074 35,374 32,962 72,971 57,962
-------- -------- ------- -------- -------- -------- -------- --------
End of Period $ 38,099 $ 51,057 $ 5,297 $ 15,849 $ 40,002 $ 35,374 $ 77,700 $ 72,971
======== ======== ======= ======== ======== ======== ======== ========
SHARES ISSUED AND REDEEMED:
Institutional Class
Shares Issued 1,012 1,273 59 266 835 551 1,620 1,673
Shares Issued in Lieu of Cash Distributions 113 112 -- 1 2 2 3 1
Shares Redeemed (2,397) (2,852) (1,131) (879) (777) (782) (1,066) (901)
-------- -------- ------- -------- -------- -------- -------- --------
Total Institutional Class Share Transactions (1,272) (1,467) (1,072) (612) 60 (229) 557 773
-------- -------- ------- -------- -------- -------- -------- --------
Retail Class A
Shares Issued 4 12 40 6 279 474 82 757
Shares Issued in Lieu of Cash Distributions 1 1 1 1 43 37 50 52
Shares Redeemed (10) (37) (15) (8) (108) (179) (388) (340)
-------- -------- ------- -------- -------- -------- -------- --------
Total Retail Class A Share Transactions (5) (24) 26 (1) 214 332 (256) 469
-------- -------- ------- -------- -------- -------- -------- --------
Retail Class B (1)
Shares Issued -- -- -- -- 131 -- 212 --
Shares Issued in Lieu of Cash Distributions -- -- -- -- 1 -- 7 --
Shares Redeemed -- -- -- -- (9) -- (2) --
-------- -------- ------- -------- -------- -------- -------- --------
Total Retail Class B Share Transactions -- -- -- -- 123 -- 217 --
-------- -------- ------- -------- -------- -------- -------- --------
Net Increase (Decrease) in Share Transactions (1,277) (1,491) (1,046) (613) 397 103 518 1,242
======== ======== ======= ======== ======== ======== ======== ========
<FN>
(1) COMMENCED OPERATIONS ON MAY 8, 1998.
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>
<TABLE>
<CAPTION>
Financial Highlights
- ------------------------------------------------------------------------------------------------------------------------------------
For a Share Outstanding Throughout the Period or Year
NET
ASSET DISTRIBUTIONS DISTRIBUTIONS REALIZED AND NET NET RATIO
VALUE, NET FROM NET FROM UNREALIZED ASSET VALUE, ASSETS,END OF EXPENSES
BEGINNING INVESTMENT INVESTMENT CAPITAL GAINS (LOSSES) END TOTAL OF PERIOD TO AVERAGE
OF PERIOD INCOME INCOME GAINS ON INVESTMENTS OF PERIOD RETURN+ (000) NET ASSETS
--------- ---------- ------------ ------------- -------------- ---------- ------- ---------- -----------
EQUITY FUND
===========
INSTITUTIONAL CLASS:
For the years ended
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 31, 1999 $15.34 0.06 (0.07) (0.72) 3.42 $18.03 24.06% $270,397 0.90%
January 31, 1998 $14.03 0.10 (0.10) (1.68) 2.99 $15.34 22.14% $195,500 0.90%
January 31, 1997 $12.64 0.11 (0.11) (0.94) 2.33 $14.03 20.00% $177,234 0.90%
January 31, 1996 $10.24 0.17 (0.17) (0.72) 3.12 $12.64 32.55% $150,957 0.90%
For the period ended
January 31, 1995(1)** $10.00 0.01 -- -- 0.23 $10.24 2.40%* $ 97,052 0.90%
RETAIL CLASS A:
For the year ended
January 31, 1999 $15.34 0.02 (0.03) (0.72) 3.40 $18.01 23.64% $ 12,064 1.15%
January 31, 1998 $14.04 0.06 (0.06) (1.68) 2.98 $15.34 21.78% $ 9,756 1.15%
January 31, 1997 $12.65 0.08 (0.08) (0.94) 2.33 $14.04 19.72% $ 4,099 1.15%
For the period ended
January 31, 1996(2)** $10.52 0.14 (0.15) (0.72) 2.86 $12.65 32.34%* $ 1,769 1.15%
RETAIL CLASS B:
For the period ended
January 31, 1999(3)** $17.26 (0.07) (0.01) (0.72) 1.47 $17.93 10.97%* $ 2,185 1.90%
BALANCED FUND
=============
INSTITUTIONAL CLASS:
For the years ended
January 31, 1999 $13.10 0.29 (0.29) (0.86) 1.75 $13.99 16.75% $214,939 0.90%
January 31, 1998 $12.01 0.32 (0.30) (0.64) 1.71 $13.10 17.28% $175,751 0.90%
January 31, 1997 $11.79 0.34 (0.35) (0.78) 1.01 $12.01 12.03% $156,315 0.90%
January 31, 1996 $10.20 0.39 (0.39) (0.42) 2.01 $11.79 24.15% $147,357 0.90%
For the period ended
January 31, 1995(1)** $10.00 0.04 -- -- 0.16 $10.20 2.00%* $112,896 0.90%
RETAIL CLASS A:
For the years ended
January 31, 1999 $13.08 0.25 (0.26) (0.86) 1.76 $13.97 16.50% $ 4,339 1.15%
January 31, 1998 $12.00 0.28 (0.27) (0.64) 1.71 $13.08 16.92% $ 3,869 1.15%
January 31, 1997 $11.78 0.31 (0.32) (0.78) 1.01 $12.00 11.81% $ 2,875 1.15%
For the period ended
January 31, 1996(2)** $10.34 0.32 (0.31) (0.42) 1.85 $11.78 23.88%* $ 1,664 1.15%
RETAIL CLASS B:
For the period ended
January 31, 1999(3)** $14.09 0.11 (0.12) (0.87) 0.74 $13.95 7.99%* $ 1,481 1.90%
</TABLE>
RATIO RATIO OF
OF EXPENSES NET INCOME
TO AVERAGE RATIO OF TO AVERAGE
NET ASSETS NET INCOME NET ASSETS PORTFOLIO
(EXCLUDING TO AVERAGE (EXCLUDING TURNOVER
WAIVERS) NET ASSETS WAIVERS) RATE
----------- ---------- ---------- ---------
EQUITY FUND
===========
INSTITUTIONAL CLASS:
For the years ended
January 31, 1999 1.06% 0.36% 0.20% 74.99%
January 31, 1998 1.00% 0.63% 0.53% 36.68%
January 31, 1997 1.07% 0.81% 0.64% 97.14%
January 31, 1996 1.14% 1.43% 1.19% 103.85%
For the period ended
January 31, 1995(1)** 1.26% 1.22% 0.86% 6.03%
RETAIL CLASS A:
For the year ended
January 31, 1999 1.31% 0.12% (0.04)% 74.99%
January 31, 1998 1.28% 0.33% 0.20% 36.68%
January 31, 1997 1.31% 0.52% 0.36% 97.14%
For the period ended
January 31, 1996(2)** 1.37% 0.99% 0.77% 103.85%
RETAIL CLASS B:
For the period ended
January 31, 1999(3)** 2.10% (0.85)% (1.05)% 74.99%
BALANCED FUND
============
INSTITUTIONAL CLASS:
For the years ended
January 31, 1999 1.05% 2.14% 1.99% 54.88%
January 31, 1998 1.02% 2.49% 2.37% 30.91%
January 31, 1997 1.07% 2.90% 2.73% 68.11%
January 31, 1996 1.14% 3.48% 3.24% 59.74%
For the period ended
January 31, 1995(1)** 1.26% 3.61% 3.25% 1.70%
RETAIL CLASS A:
For the years ended
January 31, 1999 1.30% 1.90% 1.75% 54.88%
January 31, 1998 1.27% 2.23% 2.11% 30.91%
January 31, 1997 1.32% 2.64% 2.47% 68.11%
For the period ended
January 31, 1996(2)** 1.38% 3.06% 2.83% 59.74%
RETAIL CLASS B:
For the period ended
January 31, 1999(3)** 2.07% 1.00% 0.83% 54.88%
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
48
<PAGE>
<TABLE>
<CAPTION>
THE ACHIEVEMENT FUNDS
NET NET NET
ASSET DISTRIBUTIONS DISTRIBUTIONS REALIZED AND ASSET ASSETS, RATIO
VALUE, NET FROM NET FROM UNREALIZED VALUE, END OF EXPENSES
BEGINNING INVESTMENT INVESTMENT CAPITAL GAINS (LOSSES) END TOTAL OF PERIOD TO AVERAGE
OF PERIOD INCOME INCOME GAINS ON INVESTMENTS OF PERIOD RETURN+ (000) NET ASSETS
--------- ---------- ------------ ------------- -------------- ---------- ------- ---------- -----------
INTERMEDIATE TERM
BOND FUND
- ------------
- ------------
INSTITUTIONAL CLASS:
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
For the years ended
January 31, 1999 $10.63 0.61 (0.61) -- 0.14 $10.77 7.25% $168,545 0.75%
January 31, 1998 $10.37 0.62 (0.62) -- 0.26 $10.63 8.82% $161,742 0.75%
January 31, 1997 $10.79 0.62 (0.62) -- (0.42) $10.37 2.06% $134,645 0.75%
January 31, 1996 $10.09 0.71 (0.70) -- 0.69 $10.79 13.62% $115,307 0.75%
For the period ended
January 31, 1995(1)** $10.00 0.05 (0.06) -- 0.10 $10.09 1.54%* $ 65,633 0.75%
RETAIL CLASS A:
For the years ended
January 31, 1999 $10.66 0.58 (0.59) -- 0.14 $10.79 6.91% $ 1,743 1.00%
January 31, 1998 $10.40 0.60 (0.60) -- 0.26 $10.66 8.60% $ 2,776 1.00%
January 31, 1997 $10.82 0.60 (0.60) -- (0.42) $10.40 1.80% $ 2,730 1.00%
For the period ended
January 31, 1996(2)** $10.16 0.56 (0.55) -- 0.65 $10.82 13.49%* $ 963 1.00%
SHORT TERM
BOND FUND
- ------------
- ------------
INSTITUTIONAL CLASS:
For the years ended
January 31, 1999 $10.05 0.55 (0.55) -- (0.03) $10.02 5.33% $ 37,951 0.75%
January 31, 1998 $10.01 0.57 (0.57) -- 0.04 $10.05 6.25% $ 50,853 0.75%
January 31, 1997 $10.18 0.60 (0.60) -- (0.17) $10.01 4.40% $ 65,328 0.75%
January 31, 1996 $10.02 0.67 (0.65) -- 0.14 $10.18 7.80% $ 75,632 0.75%
For the period ended
January 31, 1995(1)** $10.00 0.04 (0.06) -- 0.04 $10.02 0.79%* $ 70,380 0.75%
RETAIL CLASS A:
For the years ended
January 31, 1999 $10.04 0.52 (0.52) -- (0.04) $10.00 4.94% $ 148 1.00%
January 31, 1998 $10.00 0.55 (0.55) -- 0.04 $10.04 6.04% $ 204 1.00%
January 31, 1997 $10.18 0.57 (0.58) -- (0.17) $10.00 4.04% $ 443 1.00%
For the period ended
January 31, 1996(2)** $10.03 0.53 (0.52) -- 0.14 $10.18 7.55%* $ 39 1.00%
</TABLE>
OF EXPENSES NET INCOME
TO AVERAGE RATIO OF TO AVERAGE
NET ASSETS NET INCOME NET ASSETS PORTFOLIO
(EXCLUDING TO AVERAGE (EXCLUDING TURNOVER
WAIVERS) NET ASSETS WAIVERS) RATE
----------- ---------- ---------- ---------
INTERMEDIATE TERM
BOND FUND
- ------------
- ------------
INSTITUTIONAL CLASS:
For the years ended
January 31, 1999 0.91% 5.72% 5.55% 28.03%
January 31, 1998 0.87% 5.99% 5.87% 20.91%
January 31, 1997 0.95% 6.02% 5.82% 21.23%
January 31, 1996 1.02% 6.14% 5.87% 85.16%
For the period ended
January 31, 1995(1)** 1.13% 5.60% 5.22% 10.57%
RETAIL CLASS A:
For the years ended
January 31, 1999 1.15% 5.48% 5.34% 28.03%
January 31, 1998 1.11% 5.75% 5.64% 20.91%
January 31, 1997 1.18% 5.76% 5.58% 21.23%
For the period ended
January 31, 1996(2)** 1.26% 5.74% 5.48% 85.16%
SHORT TERM
BOND FUND
- ------------
- ------------
INSTITUTIONAL CLASS:
For the years ended
January 31, 1999 1.01% 5.50% 5.24% 26.51%
January 31, 1998 0.95% 5.68% 5.48% 48.90%
January 31, 1997 0.96% 6.00% 5.79% 40.80%
January 31, 1996 0.99% 6.11% 5.87% 83.64%
For the period ended
January 31, 1995(1)** 1.13% 4.21% 3.83% 11.95%
RETAIL CLASS A:
For the years ended
January 31, 1999 1.25% 5.25% 5.00% 26.51%
January 31, 1998 1.18% 5.43% 5.25% 48.90%
January 31, 1997 1.20% 5.74% 5.54% 40.80%
For the period ended
January 31, 1996(2)** 1.23% 5.75% 5.52% 83.64%
* 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 MAY 8, 1998.
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
49
<PAGE>
Financial Highlights
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
For a Share Outstanding Throughout the Period or Year
NET
ASSET DISTRIBUTIONS DISTRIBUTIONS REALIZED AND NET NET RATIO
VALUE, NET FROM NET FROM UNREALIZED ASSET VALUE, ASSETS,END OF EXPENSES
BEGINNING INVESTMENT INVESTMENT CAPITAL GAINS (LOSSES) END TOTAL OF PERIOD TO AVERAGE
OF PERIOD INCOME INCOME GAINS ON INVESTMENTS OF PERIOD RETURN+ (000) NET ASSETS
--------- ---------- ------------ ------------- -------------- ---------- ------- ---------- -----------
SHORT TERM
MUNICIPAL
BOND FUND
- ----------
- ----------
INSTITUTIONAL CLASS:
For the years ended
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 31, 1999 $10.05 0.36 (0.37) (0.03) (0.03) $ 9.98 3.26% $ 4,816 0.75%
January 31, 1998 $10.08 0.37 (0.38) (0.07) 0.05 $10.05 4.38% $15,626 0.75%
January 31, 1997 $10.23 0.39 (0.39) (0.07) (0.08) $10.08 3.03% $21,846 0.75%
January 31, 1996 $10.01 0.43 (0.42) (0.05) 0.26 $10.23 6.71% $31,304 0.75%
For the period ended
January 31, 1995(1)**$10.00 0.03 (0.03) -- 0.01 $10.01 0.43%* $33,682 0.75%
RETAIL CLASS A:
For the years ended
January 31, 1999 $10.08 0.34 (0.34) (0.03) (0.03) $10.02 3.18% $ 481 1.00%
January 31, 1998 $10.10 0.35 (0.35) (0.07) 0.05 $10.08 4.08% $ 223 1.00%
January 31, 1997 $10.25 0.36 (0.36) (0.07) (0.08) $10.10 2.76% $ 228 1.00%
For the period ended
January 31, 1996(2)**$10.01 0.33 (0.33) (0.05) 0.29 $10.25 6.99%* $ 212 1.00%
IDAHO MUNICIPAL
BOND FUND
- --------------
- --------------
INSTITUTIONAL CLASS:
For the years ended
January 31, 1999 $10.82 0.47 (0.47) (0.05) 0.14 $10.91 5.76% $26,961 0.75%
January 31, 1998 $10.41 0.47 (0.47) (0.04) 0.45 $10.82 9.06% $26,093 0.75%
January 31, 1997 $10.80 0.46 (0.46) (0.06) (0.33) $10.41 1.31% $27,487 0.75%
January 31, 1996 $10.13 0.52 (0.51) (0.12) 0.78 $10.80 12.68% $25,873 0.75%
For the period ended
January 31, 1995(1)**$10.00 0.04 (0.04) -- 0.13 $10.13 1.74%* $25,894 0.75%
RETAIL CLASS A:
For the years ended
January 31, 1999 $10.85 0.45 (0.45) (0.05) 0.13 $10.93 5.43% $11,695 1.00%
January 31, 1998 $10.44 0.45 (0.45) (0.04) 0.45 $10.85 8.84% $ 9,281 1.00%
January 31, 1997 $10.83 0.44 (0.44) (0.06) (0.33) $10.44 1.05% $ 5,475 1.00%
For the period ended
January 31, 1996(2)**$10.21 0.41 (0.40) (0.12) .73 $10.83 12.60%* $ 3,109 1.00%
RETAIL CLASS B:
For the period ended
January 31, 1999(3)**$10.69 0.27 (0.27) (0.05) 0.30 $10.94 5.37%* $ 1,346 1.75%
</TABLE>
RATIO RATIO OF
OF EXPENSES NET INCOME
TO AVERAGE RATIO OF TO AVERAGE
NET ASSETS NET INCOME NET ASSETS PORTFOLIO
(EXCLUDING TO AVERAGE (EXCLUDING TURNOVER
WAIVERS) NET ASSETS WAIVERS) RATE
----------- ---------- ---------- ---------
SHORT TERM
MUNICIPAL
BOND FUND
- ----------
- ----------
INSTITUTIONAL CLASS:
For the years ended
January 31, 1999 1.29% 3.61% 3.07% 15.38%
January 31, 1998 1.34% 3.74% 3.15% 64.76%
January 31, 1997 1.26% 3.79% 3.28% 41.11%
January 31, 1996 1.30% 3.88% 3.33% 114.09%
For the period ended
January 31, 1995(1)** 1.26% 3.67% 3.16% 11.80%
RETAIL CLASS A:
For the years ended
January 31, 1999 1.76% 3.39% 2.63% 15.38%
January 31, 1998 1.59% 3.49% 2.90% 64.76%
January 31, 1997 1.51% 3.56% 3.05% 41.11%
For the period ended
January 31, 1996(2)** 1.54% 3.49% 2.95% 114.09%
IDAHO MUNICIPAL
BOND FUND
- --------------
- --------------
INSTITUTIONAL CLASS:
For the years ended
January 31, 1999 1.00% 4.35% 4.10% 12.90%
January 31, 1998 1.10% 4.47% 4.12% 17.64%
January 31, 1997 1.24% 4.40% 3.91% 29.13%
January 31, 1996 1.35% 4.52% 3.92% 58.94%
For the period ended
January 31, 1995(1)** 1.38% 4.21% 3.58% 5.66%
RETAIL CLASS A:
For the years ended
January 31, 1999 1.25% 4.10% 3.85% 12.90%
January 31, 1998 1.37% 4.22% 3.85% 17.64%
January 31, 1997 1.47% 4.15% 3.68% 29.13%
For the period ended
January 31, 1996(2)** 1.58% 4.18% 3.60% 58.94%
RETAIL CLASS B:
For the period ended
January 31, 1999(3)** 2.05% 3.32% 3.02% 12.90%
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
50
<PAGE>
<TABLE>
<CAPTION>
THE ACHIEVEMENT FUNDS
NET
ASSET DISTRIBUTIONS DISTRIBUTIONS REALIZED AND NET NET RATIO
VALUE, NET FROM NET FROM UNREALIZED ASSET VALUE, ASSETS,END OF EXPENSES
BEGINNING INVESTMENT INVESTMENT CAPITAL GAINS (LOSSES) END TOTAL OF PERIOD TO AVERAGE
OF PERIOD INCOME INCOME GAINS ON INVESTMENTS OF PERIOD RETURN+ (000) NET ASSETS
--------- ---------- ------------ ------------- -------------- ---------- ------- ---------- -----------
MUNICIPAL
BOND FUND
- ----------
- ----------
INSTITUTIONAL CLASS:
For the years ended
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 31, 1999 $10.38 0.49 (0.49) (0.18) 0.10 $10.30 5.88% $68,239 0.75%
January 31, 1998 $10.02 0.48 (0.48) (0.12) 0.48 $10.38 9.90% $63,028 0.75%
For the period ended
January 31, 1997(4)** $10.00 0.12 (0.12) -- 0.02 $10.02 1.34%* $53,067 0.75%
RETAIL CLASS A:
For the years ended
January 31, 1999 $10.38 0.47 (0.47) (0.18) 0.09 $10.29 5.48% $ 7,226 1.00%
January 31, 1998 $10.01 0.46 (0.46) (0.12) 0.49 $10.38 9.78% $ 9,943 1.00%
For the period ended
January 31, 1997(5)** $10.01 0.15 (0.15) -- -- $10.01 1.48%* $ 4,895 1.00%
RETAIL CLASS B:
For the period ended
January 31, 1999(3)** $10.27 0.30 (0.30) (0.18) 0.21 $10.30 4.87%* $ 2,235 1.75%
</TABLE>
RATIO RATIO OF
OF EXPENSES NET INCOME
TO AVERAGE RATIO OF TO AVERAGE
NET ASSETS NET INCOME NET ASSETS PORTFOLIO
(EXCLUDING TO AVERAGE (EXCLUDING TURNOVER
WAIVERS) NET ASSETS WAIVERS) RATE
----------- ---------- ---------- ---------
MUNICIPAL
BOND FUND
- ----------
- ----------
INSTITUTIONAL CLASS:
For the years ended
January 31, 1999 0.95% 4.79% 4.59% 46.00%
January 31, 1998 1.05% 4.72% 4.42% 93.18%
For the period ended
January 31, 1997(4)** 1.07% 4.58% 4.26% 19.21%
RETAIL CLASS A:
For the years ended
January 31, 1999 1.19% 4.53% 4.34% 46.00%
January 31, 1998 1.32% 4.48% 4.16% 93.18%
For the period ended
January 31, 1997(5)** 1.29% 4.35% 4.06% 19.21%
RETAIL CLASS B:
For the period ended
January 31, 1999(3)** 1.98% 3.84% 3.61% 46.00%
* 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 MAY 8, 1998.
(4) COMMENCED OPERATIONS ON NOVEMBER 1, 1996.
(5) COMMENCED OPERATIONS ON NOVEMBER 4, 1996.
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
51
<PAGE>
JANUARY 31, 1999
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 three classes of shares,
Institutional, Retail Class A and Retail Class B. 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 traded. 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.
52
<PAGE>
The Achievement Funds
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, 1999, $117,726 and
$1,441 have been reclassified in the Equity Fund and Balanced Fund respectively
between undistributed net investment income and 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.
(CONTINUED)
53
<PAGE>
JANUARY 31, 1999
Notes to Financial Statements (continued)
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 each of the Stock
Funds and 0.60% of the average daily net assets each of the Bond Funds. Such fee
is computed daily and paid monthly. During the period ended January 31, 1999,
the Adviser voluntarily waived a portion of its fees in order to limit operating
expenses.
The Trust and First Union National 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
Investments Mutual Fund Services ("SIMFS") acts as the Trust's Administrator.
Under the terms of such an agreement, SIMFS 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 period ended January 31, 1999 for
the Short Term Municipal Bond Fund and the Idaho Municipal Bond Fund in order to
limit operating expenses.
Certain officers of the Trust are also officers of the Administrator. Such
officers are paid no fees by the Trust.
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 "Class A Plan") on behalf
of the Retail Class A shares pursuant to Rule 12b-1 under the Investment Company
Act of 1940. The Class A Plan provides for the payment by the Trust to the
Distributor of up to 0.25% of the average daily net assets of the Retail Class A
shares. The Retail Class B shares have adopted a Distribution Plan (the "Class B
Plan") pursuant to Rule 12b-1 under the Investment Company Act of 1940. The
Class B Plan provides for payment to the Distributor of a distribution fee of up
to 0.75% of the average daily net assets of the Class B shares and a
54
<PAGE>
The Achievement Funds
shareholder servicing fee up to 0.25% of the average daily net assets of
the Class B shares. The Distributor has elected to collect a distribution fee
for the Class B shares of the Municipal Bond Fund and Idaho Municipal Bond Fund
of 0.65% per annum, but reserves the right to collect the full distribution fee
payable under the Class B Plan at any time.
A contingent deferred sales charge (CDSC) is imposed on certain redemptions
of Retail Class B shares. The CDSC varies depending on the number of years from
the time of payment for the purchase of Retail Class B shares until the
redemption of such shares.
YEARS SINCE CONTINGENT DEFERRED
PURCHASE MADE SALES CHARGE
-----------------------------------------------
First ...................... 5%
Second ..................... 4%
Third ...................... 4%
Fourth ..................... 3%
Fifth ...................... 2%
Sixth ...................... 1%
Seventh and Following ...... None
5. INVESTMENT TRANSACTIONS
- ----------------------------------------------------------------------------
- ----------------------------------------------------------------------------
The cost of security purchases and the proceeds from the sale of
securities, other than short-term investments for the period ended January 31,
1999, are presented on the next page for the Funds. On January 31, 1999 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, 1999 for each Fund is as follows on the
next page:
55
<PAGE>
JANUARY 31, 1999
Notes to Financial Statements (continued)
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
====== ======= ============ ======== ========== ========= =========
<S> <C> <C> <C> <C> <C> <C> <C>
Purchases
U.S. Government
Securities $ -- $ 6,978 $36,935 $ 7,000 $ -- $ -- $ --
Other 198,677 107,782 18,159 4,416 1,994 9,733 34,331
Sales
U.S. Government
Securities -- 4,026 39,662 15,158 -- -- --
Other 172,125 94,859 5,130 6,509 12,026 4,696 31,801
Aggregate gross
unrealized gain 105,146 59,030 5,820 143 68 2,094 2,053
Aggregate gross
unrealized loss (3,229) (1,961) (284) (42) (10) (7) (241)
-------- -------- ------- ------ ------ ------ -------
Net unrealized gain $101,917 $ 57,069 $ 5,536 $ 101 $ 58 $2,087 $ 1,812
======== ======== ======= ====== ====== ====== =======
</TABLE>
At January 31, 1999, 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 $937,377 $2,034,615
Carryforwards to Expire in 2005 519,195 8,234
Carryforwards to Expire in 2006 468,346 226,204
Carryforwards to Expire in 2007 -- 95,977
The Balanced Fund incurred losses in the amount of $4,259,940 from November
1, 1998 to January 31, 1999. As permitted by tax regulations, the Fund intends
to elect to defer and treat these losses as arising in the fiscal year ending
January 31, 2000.
(CONTINUED)
56
<PAGE>
The Achievement Funds
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
issuers' 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, 1999, 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% 9%
Education Bonds 20% 13% 6%
General Obligation 41% 56% 7%
Hospital Bonds 9% 7% 22%
Housing Bonds 10% 5% 26%
Public Facility Bonds 4% 3% 3%
Other Revenue Bonds --% 7% 14%
Transportation Bonds 10% 6% 3%
Utility Bonds 6% 2% 10%
---- ---- ----
100% 100% 100%
==== ==== ====
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, 1999, 40%, 72% and 38% 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.
57
<PAGE>
JANUARY 31, 1999
Notes to Financial Statements (conCLUDed)
The ratings of debt holdings by Standard & Poor's or Moody's as a
percentage of total value of investments at January 31, 1999 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 57% 25% 37% 70% 32%
AA+ -- -- -- -- 5%
AA 4% 1% 6% 10% 14%
AA- 5% 13% 14% 7% 3%
A+ 4% 27% -- 1% 2%
A 14% 26% 13% 4% 6%
A- 8% 8% 6% 3% 8%
BBB+ 5% -- -- 1% 5%
BBB 1% -- 10% 3% 7%
BBB- -- -- 6% -- 3%
B -- -- -- -- 1%
Not rated 2% -- 8% 1% 14%
---- ---- ---- ---- ----
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 $20,000,000. 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, 1999, none of the Funds had loans outstanding. For the period ended
January 31, 1999, the maximum amount borrowed was $500,000, the average
outstanding was $9,589, and the daily weighted average interest rate
was 8.50%.
8. SUBSEQUENT EVENT
As of February 5, 1999, investors are no longer able to purchase
Institutional or Retail Class shares of the Short Term Municipal Bond Fund.
58
<PAGE>
The Achievement Funds
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, 1999, and the related statements of operations for the year then
ended, the statements of 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 and financial highlights. Our procedures included confirmation of
securities owned as of January 31, 1999 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, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of The
Achievement Funds Trust as of January 31, 1999, 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 19, 1999
59
<PAGE>
Notice to Shareholders
(unaudited)
For shareholders that do not have a January 31, 1999 tax year end, this
notice is for informational purposes only. For shareholders with a January 31,
1999 tax year-end, please consult your tax adviser as to the pertinence of this
notice.
For the fiscal year ended January 31, 1999, each fund is designating
the following items with regard to distributions paid during the year.
<TABLE>
<CAPTION>
LONG-TERM ORDINARY TAX EXEMPT
CAPITAL GAIN INCOME INCOME
FUND DISTRIBUTION DISTRIBUTION DISTRIBUTION
- ------------------------------------------------------ -------------- -------------- --------------
<S> <C> <C> <C>
Equity Fund 70.70% 29.30% 0.00%
Balanced Fund 69.15% 30.85% 0.00%
Intermediate Term Bond Fund 0.00% 100.00% 0.00%
Short Term Bond Fund 0.00% 100.00% 0.00%
Short Term Municipal Bond Fund 5.29% 1.18% 93.53%
Idaho Municipal Bond Fund 9.59% 0.43% 89.98%
Municipal Bond Fund 18.02% 8.73% 73.25%
</TABLE>
<TABLE>
QUALIFYING
FUND TOTAL DIVIDENDS(1)
- ------------------------------------------------------ -------------- --------------
<S> <C> <C>
Equity Fund 100% 68.74%
Balanced Fund 100% 30.50%
Intermediate Term Bond Fund 100% 0.00%
Short Term Bond Fund 100% 0.00%
Short Term Municipal Bond Fund 100% 0.00%
Idaho Municipal Bond Fund 100% 0.00%
Municipal Bond Fund 100% 0.00%
<FN>
(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.
</FN>
</TABLE>
60
<PAGE>
The Achievement Funds
BOARD OF TRUSTEES
George L. Denton, Jr.
James H. Gardner
August Glissmeyer, Jr.
Blaine Huntsman
Robert G. Love
Carl S. Minden
Frederick A. Moreton, Jr.
Kent Murdock
John L. Rudisill
INVESTMENT ADVISER
First Security Investment Management, Inc.
Salt Lake City, UT 84111
ADMINISTRATOR
SEI Investments Mutual Funds Services
Oaks, PA 19456
DISTRIBUTOR
SEI Investments Distribution Co.
Oaks, PA 19456
LEGAL COUNSEL
Ballard Spahr Andrews & Ingersoll
Philadelphia, PA 19103
INDEPENDENT ACCOUNTANTS
Deloitte & Touche LLP
Princeton, NJ 08540
CUSTODIAN
First Union Corporation
Philadelphia, PA 19101
<PAGE>
[Achievement Logo Omitted]
THE
ACHIEVEMENT
FUNDS(R)
FOR YOUR LIFE'S JOURNEY(R)
Shares of any of The Achievement Funds are:
o not obligations or deposits of, or guaranteed by First Security
Corporation or any of its banks or non-bank subsidiaries;
o not federally insured by the FDIC, the Federal Reserve Board or any other
government agency;
o 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-014-05
