<PAGE>
AH&H PARTNERS FUND LIMITED PARTNERSHIP
Report on Financial Statements
For three months ending September 30, 1997
(Unaudited)
<PAGE>
AH&H PARTNERS FUND LIMITED PARTNERSHIP
Report on Financial Statements
For three months ending Sept. 30, 1997
(Unaudited)
CONTENTS
PAGE
Investment Portfolio
as of Sept. 30,1997 (Unaudited) 3-4
Statement of Assets and Liabilities
as of Sept. 30,1997 (Unaudited) 5
Statement of Operations
for three months ended Sept. 30, 1997
(Unaudited) 6
Statement of Changes in Net Assets
for three months ended Sept. 30, 1997
(Unaudited) 7
Notes to Financial Statements 8-9
<PAGE>
AH&H PARTNERS FUND LIMITED PARTNERSHIP
Investment Portfolio
As of Sept. 30, 1997
(Unaudited)
<TABLE>
<CAPTION>
INDUSTRY & COMPANY Shares Value
<S> <C> <C>
EQUITY SECURITIES - COMMON STOCK 88.2%
COMMUNICATIONS 11.3%
Alpha Industries 20,000 $370,000
Dynatech 48,500 $1,991,531
Natural Microsystems Corp. 60,000 $2,280,000
CONSUMER - Electronics 7.6%
CompUSA, Inc. 90,000 $3,150,000
CONSUMER - General 7.7%
A.T. Cross 60,100 $582,249
Just for Feet 60,000 $948,750
Party City 50,000 $1,312,500
Safety First 62,000 $329,375
CONTRACT MANUFACTURING 2.4%
ACT Manufacturing Co. 30,000 $997,500
DIVERSIFIED INDUSTRIES 2.6%
Nashua Corp. 95,000 $1,086,563
ELECTRONIC COMPONENTS 15.9%
CP Clare Corp. 100,000 $1,975,000
PCD, Inc. 106,500 $2,635,875
Unitrode 26,500 $1,964,312
ENERGY 3.2%
Energy Research Corp. 93,000 $1,313,625
FACTORY AUTOMATION 7.0%
Concentra 150,000 $900,000
Parametric Technology Corp. 44,600 $1,967,975
INTERNET 5.8%
CMG Information Services 90,000 $2,216,250
Lycos 5,625 $191,250
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
AH&H PARTNERS FUND LIMITED PARTNERSHIP
Investment Portfolio
As of Sept. 30, 1997
(Unaudited)
<TABLE>
<CAPTION>
INDUSTRY & COMPANY Shares Value
<S> <C> <C>
Equity Securities - Common Stock 88.2%
MEDICAL 5.3%
Ascent Pediatrics 153,846 $1,209,614
IMNET Systems 36,396 $978,143
Natural Products 5.9%
AMBI 100,000 $250,000
Opta Food Ingredients, Inc. 239,000 $1,493,750
Weider Nutrition 60,000 $690,000
Semiconductors 5.8%
Aseco Corp. 139,820 $2,394,417
Software 7.7%
INSO Corp 70,000 $875,000
Xionics 133,200 $2,314,350
Total Common Stock (Cost $24,701,113) $36,418,029
PRIVATE HOLDINGS 7.5%
Advanced UroScience, Inc. 275,000 $1,100,000
Asymetrix Corp. 52,307 $233,208
Cerulean Technology 255,546 $250,000
Marathon Technologies 52,083 $625,000
Sys-Tech Solutions (Pfd. Stock - Ser A) 2,777 $277,700
Sys-Tech Solutions (Pfd. Stock - Ser B) 1,020 $102,075
Sys-Tech Solutions (Com. Stock) 149,965 $14,996
Tier Technologies 95,238 $500,000
Total Private Holdings (Cost $3,212,220) $3,102,980
CASH & EQUIVALENTS 4.3%
Fidelity Daily Money Market Fund $994,323
Fidelity US Treasury Income Fund $789,767
Total Cash & Equivalents (Cost $1,784,090) $1,784,090
TOTAL INVESTMENT PORTFOLIO 100% $41,305,099
(Cost $29,697,423)
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
AH&H PARTNERS FUND LIMITED PARTNERSHIP
Statement of Assets and Liabilities
As of Sept. 30, 1997
(Unaudited)
<TABLE>
<CAPTION>
Quarter Ending
Sept. 30, 1997
--------------
ASSETS
<S> <C>
Investments at value (Cost Basis $30,003,610) $41,611,286
Cash $100
Notes Receivable $10,070
Due from AH&H $16,289
-------------
Total Assets $41,637,745
-------------
-------------
LIABILITIES
Accrued Management Fees $101,413
Accrued Capital Withdrawals $905,246
Accrued BOD Fees $2,500
Payable to AH&H for Investments Purchases $322,476
Prepaid Q4'97 Contributions $750,000
-------------
Total Liabilities $2,081,635
-------------
NET ASSETS $39,556,110
-------------
-------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
AH&H PARTNERS FUND LIMITED PARTNERSHIP
Statement of Operations
For three months ending Sept. 30, 1997
(Unaudited)
<TABLE>
<CAPTION>
Quarter Ending
Sept. 30, 1997
----------------
INVESTMENT INCOME
<S> <C>
Income:
Dividends $15,015
Interest $70
----------------
Total Income $15,085
Expenses:
Management Fees $101,413
Other expenses $4,916
---------------
Total expenses $106,329
Net investment loss ($91,244)
---------------
---------------
NET REALIZED & UNREALIZED GAIN(LOSS)
Net realized loss ($126,638)
Net unrealized appreciation $5,893,041
Net gain on investments $5,766,403
---------------
NET INCREASE IN NET ASSETS $5,675,159
---------------
---------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
6
<PAGE>
AH&H PARTNERS FUND LIMITED PARTNERSHIP
Statement of Changes in Net Assets
For three months ending Sept. 30, 1997
(Unaudited)
<TABLE>
<CAPTION>
Quarter Ending
Sept. 30, 1997
------------------
INCREASE IN NET ASSETS
<S> <C>
Operations:
Net investment loss ($91,244)
Net realized Gain $126,638
Net unrealized depreciation $5,893,041
----------------
Net increase in net assets from operations $5,675,159
Contributions to capital $520,000
Withdrawals from capital ($905,246)
-----------------
INCREASE IN NET ASSETS $5,289,913
Net assets at beginning of period $34,266,197
NET ASSETS AT END OF PERIOD $39,556,110
-----------------
-----------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
7
<PAGE>
AH&H PARTNERS FUND LIMITED PARTNERSHIP
Notes to Financial Statements
For three months ending Sept. 30, 1997
(Unaudited)
1 - SIGNIFICANT ACCOUNTING POLICIES
The AH&H Partners Fund Limited Partnership(the "Partnership")was
organized June 8,1990 as a Massachusetts limited partnership and
is registered with the Securities and Exchange Commission as a
closed-end, non-diversified management investment company. The
Agreement of Limited Partnership was amended and restated on
September 13,1990, April 1,1992 and January 1,1996. The Partner-
ship operates under the Investment Company Act of 1940(the "1940 Act")
as an interval fund. The Partnership's interests are not registered
under the Securities Act of 1933.
Adams, Harkness & Hill, Inc., a Massachusetts Corporation, serves as
Managing General Partner. The Managing General Partner must maintain
a capital account balance equal to the lesser of 1% of the sum of all
the positive capital account balances of all the Partners or the
greater of $500,000 or 0.2% of the sum of the positive capital account
balances of all the Partners.
The policies described below are followed consistently by the Partner-
ship in preparation of its financial statements in conformity with
generally accepted accounting principles.
Security Valuation
Portfolio securities which are traded on U.S. stock exchanges are
valued at the most recent sale price reported on the exchange on
which the security is traded most extensively. If no sale occurred,
the security is valued at the mean between the closing bid and asked
prices. Securities for which market quotations are not readily
available are valued at "fair value" as determined in good faith by
the general partner.
Securities Sold Short
The Partnership is engaged in selling securities short, which
obligates the Partnership to replace a security borrowed by purchas-
ing the same security at current market value. The Partnership would
incur a loss if the price of the security increases between the date
of the short sale and the date on which the Partnership replaces the
borrowed security. The Partnership would realize a gain if the price
of the security declines between those dates.
Securities Transactions and Investment Income
Securities transactions are recorded on a trade-date basis. Securities
gains or losses are determined on the identified cost basis. Dividend
income is recorded on the ex-dividend date. Interest income, includ-
ing original issue discount, where applicable, is recorded on an accrual
basis, except for bonds trading "flat", in which case interest is recorded
when received.
8
<PAGE>
AH&H PARTNERS FUND LIMITED PARTNERSHIP
Notes to Financial Statements
For three months ending Sept. 30, 1997
(Unaudited)
1 - SIGNIFICANT ACCOUNTING POLICIES (Continued)
Federal and State Income Taxes
No federal or state income tax is imposed on the Partnership
as an entity. The Partnership's income, gains, losses, deductions
and credits flow through to the Partners. Each partner must
include his or her share of partnership income in his or her
tax returns.
2 - INVESTMENT ADVISORY AGREEMENTS & TRANSACTIONS WITH AFFILIATED PERSONS
The Partnership has an investment advisory agreement with the
Managing General Partner. Certain individuals who are executive
officers and directors of the Managing General Partner are also
Limited Partners of the Partnership.
For the three months ended Sept. 30, 1997, the Managing
General Partner received fees of $101,413 for investment and
advisory services under the agreement. The fee is paid quarterly
with an annual fee basis of 1%. In addition, the Partnership
Agreement provides for a performance allocation from the Limited
Partners to the General Partner, equal to 15% of the return which
exceeds a cumulative 6% annual return. The performance allocation,
if there is one, is determined after the close of the calendar year.
3 - INVESTMENT TRANSACTIONS
Purchases and proceeds from sales of investment securities (excluding
short term investments) for the three months ended Sept. 30, 1997
aggregated $4,666,461 and $3,728,764 respectively.
4 - SIGNIFICANT SUBSEQUENT EVENT
The Partnership agreement provides for a Partnership termination
date of December 31, 2050.
9
