<PAGE>
ACCESSOR FUNDS, INC.
ANNUAL REPORT
AUDITED DECEMBER 31, 1998
GROWTH PORTFOLIO
VALUE AND INCOME PORTFOLIO
SMALL TO MID CAP PORTFOLIO
INTERNATIONAL EQUITY PORTFOLIO
INTERMEDIATE FIXED-INCOME PORTFOLIO
SHORT-INTERMEDIATE FIXED-INCOME PORTFOLIO
MORTGAGE SECURITIES PORTFOLIO
U.S. GOVERNMENT MONEY PORTFOLIO
ACCESSOR
<PAGE>
ACCESSOR FUNDS, INC.
1420 FIFTH AVENUE, SUITE 3600
SEATTLE, WASHINGTON 98101
TEL 206 224 7420
FAX 206 224 4274
February 28, 1999
Dear Shareholder:
It is our pleasure to provide you with the 1998 Annual Report for Accessor
Funds. It explains in detail how your investments performed last year and covers
several important issues, including fees and portfolio management. However,
before we review 1998 results, we'd like to first thank you for your investment
in the Portfolios and take a closer look at what we think makes Accessor Funds
special.
With three domestic equity, one international equity and four fixed-income
investment options, you, as shareholders in the Accessor Funds, have a wide
range of risk and return alternatives to structure an investment solution
designed to meet your specific needs. We believe our eight Portfolios offer more
then just a broad spectrum of equity and fixed-income investment choices. We
think they offer a better way of managing mutual fund assets. Each of the
Portfolios, except the U.S. Government Money Portfolio, is run by an external
money manager specializing in that Portfolio's asset class. Each of those money
managers is governed by strict investment mandates to run the Portfolios in a
style pure fashion. In laymen's terms this means the Growth Portfolio can only
invest in growth stocks, and so on. Finally, after five calendar quarters, money
managers are paid on a performance fee basis. The fee is based on the money
manager's performance compared to an unmanaged index of securities with similar
risk and investment characteristics. We believe this structure and approach
offers the best chance for above average performance at lower than average risk.
For a complete description of the fee structure, the manager and money managers,
and the indices, please refer to the Prospectuses and Statement of Additional
Information of Accessor Funds. If you have any questions about these or other
sections of the report, please call our shareholders services department at
800-759-3504. They'll be happy to help you.
In closing, on behalf of everyone at Accessor, I'd like to thank you again
for your confidence in us. We take the responsibility of managing your money
very seriously and will continue to work toward delivering style pure funds that
offer superior performance at below average risk.
Ravindra A. Deo
Treasurer
accessor 1
<PAGE>
ACCESSOR FUNDS, INC.
GROWTH PORTFOLIO
The Growth Portfolio ("Portfolio") commenced operations on August 24, 1992.
The Growth Portfolio seeks capital growth through investing primarily in equity
securities with greater than average growth characteristics selected from the
500 issuers which make up the Standard & Poor's 500 Composite Stock Price Index
("S&P 500"). The Portfolio is designed to have risk characteristics similar to
its benchmark, the S&P 500/BARRA Growth Index ("Index"). The money manager of
the Portfolio is Geewax Terker & Company.
On May 1, 1998, a multi-class structure was established for the Portfolio
and a new class of shares, the Investor Class Shares, was introduced. The
Investor Class Shares are primarily available through financial institutions,
retirement plans, broker-dealers, depository institutions, institutional
shareholders of record, registered investment advisers, and other financial
intermediaries. The original shares that existed prior to May 1, 1998 were
re-designated as the Advisor Class Shares. The Investor Class Shares of the
Growth Portfolio were first issued on July 1, 1998.
For the Advisor Class Shares, total annualized returns for the five-year
and since inception periods ended December 31, 1998 were 26.74% and 24.90%,
respectively. For the year ended December 31, 1998, the Portfolio had a total
return of 46.65%, as compared to 42.16% for the S&P 500/BARRA Growth Index.
For the Investor Class Shares, total returns for the three-month and since
inception periods ended December 31, 1998 were 27.49% and 16.96%, respectively.
The Growth Portfolio intends to add value over the benchmark through a
disciplined investment process which is designed to avoid the riskiest growth
stocks in the S&P 500/BARRA Growth Index and to overweight stocks with the
highest appreciation potential. In 1998, the large cap growth stocks such as
Microsoft, General Electric, and Cisco Systems were the best performing segment
of the U.S. stock market. The Growth Portfolio achieved its remarkable
performance, both in absolute terms and relative to the benchmark, mainly
through superior stock selection in consumer nondurables, consumer services, and
financial sectors.
accessor 2
<PAGE>
ACCESSOR FUNDS, INC.
GROWTH PORTFOLIO
GROWTH OF $10,000 - ADVISOR CLASS SHARES
GROWTH PORTFOLIO VS. UNMANAGED S&P 500/BARRA GROWTH INDEX
Historical Rates of Return*
Periods Ending December 31, 1998
One Year........46.65%
Five Years......26.74%
**Inception.....24.90%
<TABLE>
<CAPTION>
ACCESSOR GROWTH
DATE 10,000 IN FUND 10,000 IN INDEX
<S> <C> <C>
31-Aug-92 10,000 10,000
30-Sep-92 10,089 10,118
30-Oct-92 10,345 10,270
30-Nov-92 10,933 10,679
31-Dec-92 10,892 10,763
29-Jan-93 11,017 10,633
26-Feb-93 10,909 10,547
31-Mar-93 11,446 10,695
30-Apr-93 11,087 10,202
28-May-93 11,438 10,565
30-Jun-93 11,378 10,475
31-Jul-93 11,114 10,259
31-Aug-93 11,701 10,634
30-Sep-93 11,726 10,471
29-Oct-93 12,179 10,861
30-Nov-93 12,222 10,853
31-Dec-93 12,440 10,929
31-Jan-94 12,615 11,163
28-Feb-94 12,413 10,963
31-Mar-94 11,969 10,456
30-Apr-94 12,039 10,504
31-May-94 12,259 10,675
30-Jun-94 12,059 10,447
29-Jul-94 12,342 10,781
31-Aug-94 12,996 11,356
30-Sep-94 12,810 11,194
31-Oct-94 12,996 11,455
30-Nov-94 12,659 11,079
31-Dec-94 12,936 11,271
31-Jan-95 13,233 11,550
28-Feb-95 13,710 12,001
31-Mar-95 14,118 12,376
28-Apr-95 14,650 12,698
31-May-95 15,281 13,153
30-Jun-95 15,747 13,656
31-Jul-95 16,273 14,092
31-Aug-95 16,137 14,046
29-Sep-95 16,710 14,739
31-Oct-95 16,937 14,857
30-Nov-95 17,410 15,392
29-Dec-95 17,375 15,566
31-Jan-96 18,051 16,161
29-Feb-96 18,388 16,308
29-Mar-96 18,283 16,241
30-Apr-96 18,709 16,556
31-May-96 18,981 17,165
28-Jun-96 19,053 17,379
31-Jul-96 18,123 16,578
30-Aug-96 18,509 16,823
30-Sep-96 19,557 17,991
31-Oct-96 20,063 18,381
29-Nov-96 21,512 19,754
31-Dec-96 20,821 19,298
31-Jan-97 22,304 20,809
28-Feb-97 22,431 20,984
31-Mar-97 21,419 19,987
30-Apr-97 22,938 21,600
30-May-97 24,275 22,881
30-Jun-97 25,557 24,041
31-Jul-97 27,497 25,945
29-Aug-97 25,751 24,220
30-Sep-97 27,051 25,455
31-Oct-97 26,142 24,689
28-Nov-97 27,554 26,028
31-Dec-97 27,741 26,348
30-Jan-98 28,732 27,234
27-Feb-98 30,815 29,126
31-Mar-98 32,201 30,633
30-Apr-98 32,150 30,889
29-May-98 31,777 30,270
30-Jun-98 34,297 32,427
31-Jul-98 34,256 32,408
31-Aug-98 29,573 28,192
30-Sep-98 31,871 30,078
30-Oct-98 34,188 32,600
30-Nov-98 36,687 34,809
30-Dec-98 40,682 37,456
</TABLE>
* Annualized.
** Since inception rate of return assumes initial investment on August 24, 1992.
Comparison with the S&P 500/BARRA Growth Index assumes initial investment on
August 31, 1992.
PERFORMANCE DATA QUOTED IS HISTORICAL AND ASSUMES REINVESTMENT OF ALL DIVIDENDS
AND CAPITAL GAINS. PERFORMANCE HERE IS FOR THE ADVISOR CLASS SHARES ONLY.
INVESTOR CLASS SHARES HAVE DIFFERENT EXPENSES WHICH WILL CAUSE PERFORMANCE TO BE
DIFFERENT THAN THAT SHOWN HERE. INVESTMENT RETURN AND PRINCIPAL VALUE WILL
FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS
THAN WHEN PURCHASED. PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE RESULTS.
MONTHLY TOTAL RETURNS OF THE GROWTH PORTFOLIO
SINCE INCEPTION OF THE INVESTOR CLASS THROUGH DECEMBER 1998
<TABLE>
<CAPTION>
JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Advisor Class -0.12% -13.67% 7.77% 7.27% 7.31% 10.89%
Investor Class -1.33% -13.72% 7.75% 7.23% 7.24% 10.86%
</TABLE>
accessor 3
<PAGE>
ACCESSOR FUNDS, INC.
VALUE AND INCOME PORTFOLIO
The Value and Income Portfolio ("Portfolio") commenced operations on August
24, 1992. The Value and Income Portfolio seeks generation of current income and
capital growth by investing primarily in income-producing equity securities
selected from the 500 issuers which make up the S&P 500 Index. The Portfolio is
designed to have risk characteristics similar to its current benchmark, the S&P
500/BARRA Value Index ("Index"). Martingale Asset Management L.P. is the money
manager of the Portfolio.
On May 1, 1998, a multi-class structure was established for the Portfolio
and a new class of shares, the Investor Class Shares, was introduced. The
Investor Class Shares are primarily available through financial institutions,
retirement plans, broker-dealers, depository institutions, institutional
shareholders of record, registered investment advisers, and other financial
intermediaries. The original shares that existed prior to May 1, 1998 were
re-designated as the Advisor Class Shares. The Investor Class Shares of the
Value and Income Portfolio were first issued on July 1, 1998.
For the Advisor Class Shares, total annualized returns for the five-year
and since inception periods ended December 31, 1998 were 19.44% and 18.57%,
respectively. For the year ended December 31, 1998, the Portfolio had a total
return of 12.89%, as compared to 14.67% for the S&P 500/BARRA Value Index.
For the Investor Class Shares, total returns for the three-month and since
inception periods ended December 31, 1998 were 18.82% and -1.09%, respectively.
Relative to the broad market, value stocks had a more challenging year in
1998, despite the fact that they still produced respectable returns (please
refer to the return for S&P 500/BARRA Value Index cited above). Investors have
been greatly rewarded in recent years for following earnings momentum and price
momentum, and so have paid less attention to the valuation of stocks in general.
The money manager for the Value and Income Portfolio uses sophisticated
quantitative methods to pick those stocks in the S&P 500 Index that have
attractive long term growth prospects yet are selling at reasonable valuations.
The market environment in 1998 proved to be difficult for this strategy, and
therefore the Value and Income Portfolio lagged its performance benchmark. A
market environment in which investors pay more attention to the valuation of
stocks in general would be more favorable to the strategy used in the Value and
Income Portfolio.
accessor 4
<PAGE>
ACCESSOR FUNDS, INC.
VALUE AND INCOME PORTFOLIO
GROWTH OF $10,000 - ADVISOR CLASS SHARES
VALUE AND INCOME PORTFOLIO VS. UNMANAGED S&P 500/BARRA VALUE INDEX
Historical Rates of Return*
Periods Ending December 31, 1998
One Year........12.89%
Five Years......19.44%
**Inception.....18.57%
<TABLE>
<CAPTION>
ACCESSOR VALUE & INCOME
DATE 10,000 IN FUN 10,000 IN INDEX
<S> <C> <C>
31-Aug-92 10,000 10,000
30-Sep-92 10,056 10,110
30-Oct-92 9,973 10,027
30-Nov-92 10,331 10,300
31-Dec-92 10,539 10,493
29-Jan-93 10,841 10,775
26-Feb-93 11,176 11,146
31-Mar-93 11,462 11,454
30-Apr-93 11,318 11,408
28-May-93 11,503 11,621
30-Jun-93 11,645 11,775
31-Jul-93 11,730 11,921
31-Aug-93 12,120 12,388
30-Sep-93 12,044 12,383
29-Oct-93 12,146 12,450
30-Nov-93 11,942 12,227
31-Dec-93 12,087 12,435
31-Jan-94 12,577 13,014
28-Feb-94 12,163 12,543
31-Mar-94 11,739 12,028
30-Apr-94 11,828 12,282
31-May-94 11,918 12,485
30-Jun-94 11,654 12,140
29-Jul-94 11,970 12,550
31-Aug-94 12,285 12,905
30-Sep-94 11,920 12,451
31-Oct-94 12,137 12,722
30-Nov-94 11,702 12,207
31-Dec-94 11,850 12,357
31-Jan-95 12,123 12,692
28-Feb-95 12,597 13,184
31-Mar-95 12,928 13,547
28-Apr-95 13,304 13,993
31-May-95 13,963 14,615
30-Jun-95 13,995 14,726
31-Jul-95 14,382 15,235
31-Aug-95 14,557 15,364
29-Sep-95 14,958 15,899
31-Oct-95 14,866 15,651
30-Nov-95 15,542 16,471
29-Dec-95 15,791 16,927
31-Jan-96 16,256 17,433
29-Feb-96 16,455 17,597
29-Mar-96 16,758 18,009
30-Apr-96 17,017 18,191
31-May-96 17,247 18,465
28-Jun-96 17,142 18,376
31-Jul-96 16,437 17,601
30-Aug-96 17,029 18,086
30-Sep-96 17,760 18,861
31-Oct-96 18,466 19,500
29-Nov-96 19,922 20,992
31-Dec-96 19,571 20,650
31-Jan-97 20,630 21,599
28-Feb-97 20,751 21,757
31-Mar-97 19,847 21,013
30-Apr-97 20,809 21,801
30-May-97 22,160 23,168
30-Jun-97 22,920 24,053
31-Jul-97 25,040 25,977
29-Aug-97 24,106 24,803
30-Sep-97 25,673 26,256
31-Oct-97 24,777 25,290
28-Nov-97 25,493 26,254
31-Dec-97 26,018 26,837
30-Jan-98 25,844 26,506
27-Feb-98 27,699 28,494
31-Mar-98 29,392 29,938
30-Apr-98 29,630 30,292
29-May-98 29,230 29,866
30-Jun-98 29,130 30,093
31-Jul-98 28,195 29,439
31-Aug-98 23,588 24,705
30-Sep-98 24,690 26,206
30-Oct-98 26,961 28,259
30-Nov-98 28,320 29,731
30-Dec-98 29,371 30,775
</TABLE>
* Annualized.
** Since inception rate of return assumes initial investment on August 24, 1992.
Comparison with the S&P 500/BARRA Value Index assumes initial investment on
August 31, 1992.
PERFORMANCE DATA QUOTED IS HISTORICAL AND ASSUMES REINVESTMENT OF ALL DIVIDENDS
AND CAPITAL GAINS. PERFORMANCE HERE IS FOR THE ADVISOR CLASS SHARES ONLY.
INVESTOR CLASS SHARES HAVE DIFFERENT EXPENSES WHICH WILL CAUSE PERFORMANCE TO BE
DIFFERENT THAN THAT SHOWN HERE. INVESTMENT RETURN AND PRINCIPAL VALUE WILL
FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS
THAN WHEN PURCHASED. PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE RESULTS.
MONTHLY TOTAL RETURNS OF THE VALUE AND INCOME PORTFOLIO
SINCE INCEPTION OF THE INVESTOR CLASS THROUGH DECEMBER 1998
<TABLE>
<CAPTION>
JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Advisor Class -3.21% -16.34% 4.67% 9.20% 5.04% 3.71%
Investor Class -4.87% -16.34% 4.60% 9.15% 5.04% 3.63%
</TABLE>
accessor 5
<PAGE>
ACCESSOR FUNDS, INC.
SMALL TO MID CAP PORTFOLIO
The Small to Mid Cap Portfolio ("Portfolio") commenced operations on August
24, 1992. The Portfolio seeks capital growth through investing primarily in
equity securities of small to medium capitalization issuers. The Portfolio is
designed to have risk characteristics similar to its benchmark, the Wilshire
4500 Index. In September 1995, the investment objective of the Portfolio was
changed by a vote of the shareholders. The performance for periods prior to
October 1995 shows performance of the Portfolio before the restatement of the
investment objective. The BARRA Institutional Small Index was used and is
provided in the first graph only for comparative depiction of the prior period.
The money manager of the Portfolio is Symphony Asset Management L.L.C.
On May 1, 1998, a multi-class structure was established for the Portfolio
and a new class of shares, the Investor Class Shares, was introduced. The
Investor Class Shares are primarily available through financial institutions,
retirement plans, broker-dealers, depository institutions, institutional
shareholders of record, registered investment advisers, and other financial
intermediaries. The original shares that existed prior to May 1, 1998 were
re-designated as the Advisor Class Shares. The Investor Class Shares of the
Small to Mid Cap Portfolio were first issued on June 24, 1998.
For the Advisor Class Shares, total annualized returns for the five-year
and since inception periods ended December 31, 1998 were 20.07% and 20.28%,
respectively. For the year ended December 31, 1998, the Portfolio had a total
return of 15.98%, as compared to 8.63% for the Wilshire 4500 Index.
For the Investor Class Shares, total returns for the three-month and since
inception periods ended December 31, 1998 were 24.05% and 3.32%, respectively.
Small and mid cap stocks significantly lagged behind large cap stocks in
1998. Nevertheless, the Small to Mid Cap Portfolio produced very respectable
returns and again outperformed its benchmark by a wide margin. The money manager
for the Small to Mid Cap Portfolio uses sophisticated quantitative tools to
select stocks and construct portfolios. Its investment process combines screens
on liquidity, profitability, valuation, and other characteristics of the stocks
in the Wilshire 4500 Index, as well as earnings estimates of Wall Street
analysts (the money manager gives more weight to those analysts who they know
from past experience give more accurate forecasts). Information on corporate
insider transactions is also considered. This strategy has proven to be
especially suited for small to mid cap stocks as a vast quantity of information
can be quickly and efficiently processed on thousands of stocks. In addition,
the money manager tries to enhance performance by controlling the transaction
costs via electronic trading networks.
RESULTS OF PROXY SOLICITATION
At a special meeting of shareholders held on April 30, 1998, shareholders
of the Small to Mid Cap Portfolio voted to approve a new money manager agreement
with Symphony Asset Management L.L.C. The results of the voting were as follows:
<TABLE>
<CAPTION>
FOR AGAINST ABSTAIN
<S> <C> <C>
5,216,088.64 19,603.85 8,485.99
</TABLE>
accessor 6
<PAGE>
ACCESSOR FUNDS, INC.
SMALL TO MID CAP PORTFOLIO
PERFORMANCE DATA QUOTED IN THE FOLLOWING CHARTS IS HISTORICAL AND ASSUMES
REINVESTMENT OF ALL DIVIDENDS AND CAPITAL GAINS. PERFORMANCE HERE IS FOR THE
ADVISOR CLASS SHARES ONLY. INVESTOR CLASS SHARES HAVE DIFFERENT EXPENSES WHICH
WILL CAUSE PERFORMANCE TO BE DIFFERENT THAN THAT SHOWN HERE. INVESTMENT RETURN
AND PRINCIPAL VALUE WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED,
MAY BE WORTH MORE OR LESS THAN WHEN PURCHASED. PAST PERFORMANCE IS NOT
PREDICTIVE OF FUTURE RESULTS.
GROWTH OF $10,000 - ADVISOR CLASS SHARES
SMALL TO MID CAP PORTFOLIO VS. UNMANAGED BARRA INSTITUTIONAL SMALL INDEX
Historical Rates of Return*
Periods Ending December 31, 1998
One Year........15.98%
Five Years......20.07%
**Inception.....20.28%
<TABLE>
<CAPTION>
ACCESSOR SMALL TO MID CAP
SEPARATE PERIODS
DATE 10,000 IN FUND 10,000 IN INDEX
<S> <C> <C>
31-Aug-92 10,000 10,000
30-Sep-92 10,096 10,196
30-Oct-92 10,408 10,458
30-Nov-92 11,091 11,208
31-Dec-92 11,452 11,597
29-Jan-93 11,765 11,967
26-Feb-93 11,587 11,785
31-Mar-93 11,986 12,204
30-Apr-93 11,538 11,781
28-May-93 11,960 12,179
30-Jun-93 12,027 12,269
30-Jul-93 12,171 12,488
31-Aug-93 12,620 13,046
30-Sep-93 12,842 13,394
29-Oct-93 13,037 13,787
30-Nov-93 12,664 13,308
31-Dec-93 13,101 13,722
31-Jan-94 13,499 14,077
28-Feb-94 13,304 13,949
31-Mar-94 12,630 13,200
29-Apr-94 12,692 13,165
31-May-94 12,452 13,059
30-Jun-94 12,113 12,734
29-Jul-94 12,300 12,984
31-Aug-94 12,957 13,676
30-Sep-94 12,904 13,676
31-Oct-94 12,877 13,625
30-Nov-94 12,335 13,107
30-Dec-94 12,568 13,320
31-Jan-95 12,505 13,278
28-Feb-95 12,880 13,808
31-Mar-95 13,124 14,101
28-Apr-95 13,401 14,382
31-May-95 13,615 14,632
30-Jun-95 14,319 15,453
31-Jul-95 15,314 16,428
31-Aug-95 15,538 16,815
29-Sep-95 15,916 17,227
</TABLE>
* Annualized.
** Since inception rate of return assumes initial investment on August 24, 1992.
Comparison with BARRA Institutional Small Index assumes initial investment on
August 31, 1992 and through the period ended September 15, 1995. The investment
objective and comparable index was changed by a vote of the Fund's shareholders.
Beginning in September 1995, the Wilshire 4500 Index is used as the Portfolio's
benchmark.
GROWTH OF $10,000 - ADVISOR CLASS SHARES
SMALL TO MID CAP PORTFOLIO VS. UNMANAGED WILSHIRE 4500 INDEX
Historical Rates of Return*
Periods Ending December 31, 1998
One Year........15.98%
Five Years......20.07%
**Inception.....20.28%
<TABLE>
<CAPTION>
ACCESSOR SMALL TO MID CAP
SEPARATE PERIODS
DATE 10,000 IN FUND 10,000 IN INDEX
<S> <C> <C>
29-Sep-95 10,000 10,000
31-Oct-95 9,667 9,732
30-Nov-95 10,135 10,145
29-Dec-95 10,421 10,273
31-Jan-96 10,379 10,379
29-Feb-96 10,811 10,716
29-Mar-96 10,957 10,880
30-Apr-96 11,472 11,386
31-May-96 11,732 11,752
28-Jun-96 11,479 11,383
31-Jul-96 10,788 10,528
30-Aug-96 11,583 11,097
30-Sep-96 12,215 11,626
31-Oct-96 12,270 11,455
29-Nov-96 12,895 11,938
31-Dec-96 13,010 12,046
31-Jan-97 13,362 12,435
28-Feb-97 12,996 12,172
31-Mar-97 12,472 11,536
30-Apr-97 12,950 11,564
30-May-97 14,099 12,715
30-Jun-97 14,691 13,318
31-Jul-97 16,041 14,235
31-Aug-97 16,181 14,364
30-Sep-97 17,651 15,359
31-Oct-97 16,944 14,774
28-Nov-97 17,223 14,779
31-Dec-97 17,714 15,140
30-Jan-98 17,780 14,924
27-Feb-98 19,355 16,065
31-Mar-98 20,321 16,896
30-Apr-98 20,695 17,110
29-May-98 19,745 16,311
30-Jun-98 20,307 16,565
31-Jul-98 18,870 15,626
31-Aug-98 15,586 12,598
30-Sep-98 16,539 13,508
30-Oct-98 17,048 14,276
30-Nov-98 18,260 15,164
30-Dec-98 20,433 16,447
</TABLE>
* Annualized.
** Since inception rate of return assumes initial investment on August 24, 1992.
Comparison with BARRA Institutional Small Index assumes initial investment on
August 31, 1992 and through the period ended September 15, 1995. The investment
objective and comparable index was changed by a vote of the Fund's shareholders.
Beginning in September 1995, the Wilshire 4500 Index is used as the Portfolio's
benchmark.
accessor 7
<PAGE>
ACCESSOR FUNDS, INC.
SMALL TO MID CAP PORTFOLIO
GROWTH OF $10,000 - ADVISOR CLASS SHARES
SMALL TO MID CAP PORTFOLIO VS. UNMANAGED SMALL TO MID CAP COMPOSITE INDEX*
Historical Rates of Return**
Periods Ending December 31, 1998
One Year........15.98%
Five Years......20.07%
***Inception....20.28%
<TABLE>
<CAPTION>
ACCESSOR SMALL TO MID CAP
TOTAL HISTORY
DATE 10,000 IN FUND 10,000 IN INDEX
<S> <C> <C>
31-Aug-92 10,000 10,000
30-Sep-92 10,096 10,196
30-Oct-92 10,408 10,458
30-Nov-92 11,091 11,208
31-Dec-92 11,452 11,597
29-Jan-93 11,765 11,967
26-Feb-93 11,587 11,785
31-Mar-93 11,986 12,204
30-Apr-93 11,538 11,781
28-May-93 11,960 12,179
30-Jun-93 12,027 12,269
30-Jul-93 12,171 12,488
31-Aug-93 12,620 13,046
30-Sep-93 12,842 13,394
29-Oct-93 13,037 13,787
30-Nov-93 12,664 13,308
31-Dec-93 13,101 13,722
31-Jan-94 13,499 14,077
28-Feb-94 13,304 13,949
31-Mar-94 12,630 13,200
29-Apr-94 12,692 13,165
31-May-94 12,452 13,059
30-Jun-94 12,113 12,734
29-Jul-94 12,300 12,984
31-Aug-94 12,957 13,676
30-Sep-94 12,904 13,676
31-Oct-94 12,877 13,625
30-Nov-94 12,335 13,107
30-Dec-94 12,568 13,320
31-Jan-95 12,505 13,278
28-Feb-95 12,880 13,808
31-Mar-95 13,124 14,101
28-Apr-95 13,401 14,382
31-May-95 13,615 14,632
30-Jun-95 14,319 15,453
31-Jul-95 15,314 16,428
31-Aug-95 15,538 16,815
29-Sep-95 15,916 17,227
31-Oct-95 15,386 16,766
30-Nov-95 16,131 17,478
29-Dec-95 16,586 17,698
31-Jan-96 16,520 17,880
29-Feb-96 17,207 18,462
29-Mar-96 17,439 18,744
30-Apr-96 18,259 19,616
31-May-96 18,673 20,246
28-Jun-96 18,270 19,611
31-Jul-96 17,170 18,138
30-Aug-96 18,435 19,118
30-Sep-96 19,442 20,029
31-Oct-96 19,529 19,733
29-Nov-96 20,524 20,566
31-Dec-96 20,706 20,752
31-Jan-97 21,267 21,422
28-Feb-97 20,685 20,969
31-Mar-97 19,851 19,874
30-Apr-97 20,611 19,923
30-May-97 22,440 21,905
30-Jun-97 23,382 22,943
31-Jul-97 25,531 24,523
31-Aug-97 25,753 24,745
30-Sep-97 28,094 26,460
31-Oct-97 26,967 25,453
28-Nov-97 27,412 25,460
31-Dec-97 28,193 26,083
30-Jan-98 28,298 25,710
27-Feb-98 30,805 27,676
31-Mar-98 32,342 29,107
30-Apr-98 32,937 29,476
29-May-98 31,425 28,099
30-Jun-98 32,321 28,537
31-Jul-98 30,033 26,920
31-Aug-98 24,807 21,704
30-Sep-98 26,323 23,271
30-Oct-98 27,133 24,593
30-Nov-98 29,063 26,123
30-Dec-98 32,521 28,334
</TABLE>
* The Small to Mid Cap Composite Index is a hypothetical index constructed by
Accessor Capital Management, which links the BARRA Institutional Small Index and
the Wilshire 4500 Index. Prior to October 1995, the BARRA Institutional Small
Index was used. Starting in October 1995, the Wilshire 4500 Index is used. The
performance for periods starting prior to October 1995 and running past
September 1995 links the returns for each index for the periods referenced in
the previous sentences.
** Annualized.
*** Since inception rate of return assumes initial investment on August 24,
1992. Comparison with BARRA Institutional Small Index assumes initial investment
on August 31, 1992 and through the period ended September 15, 1995. The
investment objective and comparable index was changed by a vote of the Fund's
shareholders. Beginning in September 1995, the Wilshire 4500 Index is used as
the Portfolio's benchmark.
MONTHLY TOTAL RETURNS OF THE SMALL TO MID CAP PORTFOLIO
SINCE INCEPTION OF THE INVESTOR CLASS THROUGH DECEMBER 1998
<TABLE>
<CAPTION>
JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Advisor Class -7.08% -17.40% 6.11% 3.08% 7.11% 12.52%
Investor Class -7.10% -17.46% 6.12% 3.03% 7.02% 12.50%
</TABLE>
accessor 8
<PAGE>
ACCESSOR FUNDS, INC.
INTERNATIONAL EQUITY PORTFOLIO
The International Equity Portfolio ("Portfolio") commenced operations on
October 3, 1994. The International Equity Portfolio seeks capital growth by
investing primarily in equity securities of companies domiciled in countries
other than the United States and traded in foreign stock exchanges. The
Portfolio is designed to have risk characteristics similar to its benchmark, the
Morgan Stanley Capital International ("MSCI") EAFE-Registered Trademark-+EMF
Index ("Index"). Performance for periods prior to May 1996 show comparisons with
the previous benchmark index, the MSCI EAFE Index. The MSCI EAFE Index is
provided in the first graph only for comparative depiction of the prior period.
The money manager of the Portfolio is Nicholas-Applegate Capital Management.
On May 1, 1998, a multi-class structure was established for the Portfolio
and a new class of shares, the Investor Class Shares, was introduced. The
Investor Class Shares are primarily available through financial institutions,
retirement plans, broker-dealers, depository institutions, institutional
shareholders of record, registered investment advisers, and other financial
intermediaries. The original shares that existed prior to May 1, 1998 were
re-designated as the Advisor Class Shares. The Investor Class Shares of the
International Equity Portfolio were first issued on July 6, 1998.
For the Advisor Class Shares, total annualized return since inception to
December 31, 1998 was 10.60%. For the year ended December 31, 1998, the
Portfolio had a total return of 16.07% as compared to 15.23% for the MSCI
EAFE-Registered Trademark-+EMF Index.
For the Investor Class Shares, total returns for the three-month and since
inception periods ended December 31, 1998 were 14.27% and -4.01%, respectively.
Like the U. S. market, there was much volatility in the international stock
markets. European stock markets rallied strongly, in anticipation of the
introduction of the Euro, the new single currency for 11 European Economic &
Monetary Union (EMU) member countries. Stock markets in the Pacific region were
lackluster, as the Japanese economy remained depressed. Emerging markets
continued to suffer, with Russia and Brazil becoming the latest casualties.
Despite this challenging market environment, the International Equity Portfolio
produced impressive performance relative to its benchmark. The money manager of
the Portfolio achieved this mainly through astute stock selections and country
exposures. Selective and defensive currency hedging also made a positive
contribution. Among the best performing stocks in the Portfolio were Nokia, the
Finnish cellular phone maker, and Mannesmann, the German industrial and
telecommunication giant.
accessor 9
<PAGE>
ACCESSOR FUNDS, INC.
INTERNATIONAL EQUITY PORTFOLIO
PERFORMANCE DATA QUOTED IN THE FOLLOWING CHARTS IS HISTORICAL AND ASSUMES
REINVESTMENT OF ALL DIVIDENDS AND CAPITAL GAINS. PERFORMANCE HERE IS FOR THE
ADVISOR CLASS SHARES ONLY. INVESTOR CLASS SHARES HAVE DIFFERENT EXPENSES WHICH
WILL CAUSE PERFORMANCE TO BE DIFFERENT THAN THAT SHOWN HERE. INVESTMENT RETURN
AND PRINCIPAL VALUE WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED,
MAY BE WORTH MORE OR LESS THAN WHEN PURCHASED. PAST PERFORMANCE IS NOT
PREDICTIVE OF FUTURE RESULTS. INVESTMENTS IN SECURITIES OF NON-U.S. ISSUERS AND
FOREIGN CURRENCIES INVOLVE RISKS DIFFERENT FROM THOSE OF U.S. ISSUERS. THE
PROSPECTUS CONTAINS FURTHER INFORMATION AND DETAILS REGARDING THESE RISKS.
GROWTH OF $10,000 - ADVISOR CLASS SHARES
INTERNATIONAL EQUITY PORTFOLIO VS. UNMANAGED MSCI
EAFE-REGISTERED TRADEMARK- INDEX
Historical Rates of Return*
Periods Ending December 31, 1998
One Year........16.07%
**Inception.....10.60%
<TABLE>
<CAPTION>
ACCESSOR INTERNATIONAL EQUITY
SEPARATE PERIODS
DATE 10,000 IN FUND 10,000 IN INDEX
<S> <C> <C>
31-Oct-94 10,000 10,000
30-Nov-94 9,491 9,519
31-Dec-94 9,589 9,579
31-Jan-95 9,030 9,211
28-Feb-95 8,998 9,183
31-Mar-95 9,211 9,755
28-Apr-95 9,482 10,122
31-May-95 9,343 10,002
30-Jun-95 9,293 9,826
31-Jul-95 9,942 10,438
31-Aug-95 10,033 10,040
29-Sep-95 10,221 10,236
31-Oct-95 9,959 9,960
30-Nov-95 10,090 10,304
29-Dec-95 10,320 10,719
31-Jan-96 10,304 10,763
29-Feb-96 10,533 10,800
29-Mar-96 10,886 11,029
30-Apr-96 11,313 11,350
</TABLE>
* Annualized.
** Inception assumes initial investment on October 3, 1994. Comparison with the
MSCI EAFE-Registered Trademark- Index assumes initial investment on October 31,
1994 and through the period ended April 30, 1996. Beginning in May 1996, the
MSCI EAFE-Registered Trademark-+EMF Index is used as the Portfolio's benchmark.
GROWTH OF $10,000 - ADVISOR CLASS SHARES
INTERNATIONAL EQUITY PORTFOLIO VS. UNMANAGED MSCI
EAFE-REGISTERED TRADEMARK-+EMF INDEX
Historical Rates of Return*
Periods Ending December 31, 1998
One Year........16.07%
**Inception.....10.60%
<TABLE>
<CAPTION>
Accessor International Equity
Separate Periods
Date 10,000 in Fund 10,000 in Index
<S> <C> <C>
30-Apr-96 10,000 10,000
31-May-96 10,015 9,840
28-Jun-96 10,182 9,898
31-Jul-96 9,674 9,569
30-Aug-96 9,769 9,609
30-Sep-96 9,907 9,828
31-Oct-96 9,907 9,700
29-Nov-96 10,321 10,057
31-Dec-96 10,380 9,948
31-Jan-97 10,387 9,733
28-Feb-97 10,424 9,927
31-Mar-97 10,499 9,933
30-Apr-97 10,552 10,010
30-May-97 11,227 10,618
30-Jun-97 11,828 11,220
31-Jul-97 12,533 11,424
29-Aug-97 11,684 10,514
30-Sep-97 12,508 11,081
31-Oct-97 11,395 10,117
28-Nov-97 11,320 10,002
31-Dec-97 11,517 10,111
30-Jan-98 11,882 10,433
27-Feb-98 12,472 11,121
31-Mar-98 13,031 11,487
30-Apr-98 13,435 11,571
29-May-98 13,558 11,359
30-Jun-98 13,481 11,336
31-Jul-98 14,041 11,481
31-Aug-98 12,123 9,895
30-Sep-98 11,680 9,667
30-Oct-98 12,022 10,678
30-Nov-98 12,636 11,255
30-Dec-98 13,368 11,652
</TABLE>
* Annualized.
** Inception assumes initial investment on October 3, 1994. Comparison with the
MSCI EAFE-Registered Trademark- Index assumes initial investment on October 31,
1994 and through the period ended April 30, 1996. Beginning in May 1996, the
MSCI EAFE-Registered Trademark-+EMF Index is used as the Portfolio's benchmark.
accessor 10
<PAGE>
ACCESSOR FUNDS, INC.
INTERNATIONAL EQUITY PORTFOLIO
GROWTH OF $10,000 - ADVISOR CLASS SHARES
INTERNATIONAL EQUITY PORTFOLIO VS. UNMANAGED INTERNATIONAL COMPOSITE INDEX*
Historical Rates of Return**
Periods Ending December 31, 1998
One Year........16.07%
***Inception....10.60%
<TABLE>
<CAPTION>
ACCESSOR INTERNATIONAL EQUITY
TOTAL HISTORY
DATE 10,000 IN FUND 10,000 IN INDEX
<S> <C> <C>
31-Oct-94 10,000 10,000
30-Nov-94 9,491 9,519
31-Dec-94 9,589 9,579
31-Jan-95 9,030 9,211
28-Feb-95 8,998 9,183
31-Mar-95 9,211 9,755
28-Apr-95 9,482 10,122
31-May-95 9,343 10,002
30-Jun-95 9,293 9,826
31-Jul-95 9,942 10,438
31-Aug-95 10,033 10,040
29-Sep-95 10,221 10,236
31-Oct-95 9,959 9,960
30-Nov-95 10,090 10,304
29-Dec-95 10,320 10,719
31-Jan-96 10,304 10,763
29-Feb-96 10,533 10,800
29-Mar-96 10,886 11,029
30-Apr-96 11,313 11,350
31-May-96 11,330 11,168
28-Jun-96 11,519 11,234
31-Jul-96 10,944 10,861
30-Aug-96 11,052 10,906
30-Sep-96 11,207 11,154
31-Oct-96 11,207 11,009
29-Nov-96 11,676 11,414
31-Dec-96 11,742 11,291
31-Jan-97 11,751 11,047
28-Feb-97 11,793 11,267
31-Mar-97 11,878 11,274
30-Apr-97 11,937 11,361
30-May-97 12,701 12,051
30-Jun-97 13,381 12,735
31-Jul-97 14,178 12,966
29-Aug-97 13,218 11,933
30-Sep-97 14,150 12,576
31-Oct-97 12,891 11,482
28-Nov-97 12,806 11,352
31-Dec-97 13,029 11,476
30-Jan-98 13,442 11,841
27-Feb-98 14,110 12,623
31-Mar-98 14,742 13,038
30-Apr-98 15,199 13,133
29-May-98 15,339 12,893
30-Jun-98 15,251 12,866
31-Jul-98 15,884 13,030
31-Aug-98 13,714 11,231
30-Sep-98 13,214 10,971
30-Oct-98 13,601 12,119
30-Nov-98 14,295 12,775
30-Dec-98 15,124 13,224
</TABLE>
* The International Composite Index is a hypothetical index constructed by
Accessor Capital Management, which links the MSCI EAFE Index and the MSCI
EAFE+EMF Index. Prior to May 1996, the MSCI EAFE Index was used. Starting in May
1996, the MSCI EAFE+EMF Index is used. The performance for periods starting
prior May 1996 and running past April 1996 links the returns for each index for
the periods referenced in the previous sentences.
** Annualized.
*** Inception assumes initial investment on October 3, 1994. Comparison with the
MSCI EAFE-Registered Trademark- Index assumes initial investment on October 31,
1994 and through the period ended April 30, 1996. Beginning in May 1996, the
MSCI EAFE-Registered Trademark-+EMF Index is used as the Portfolio's benchmark.
MONTHLY TOTAL RETURNS OF THE INTERNATIONAL EQUITY
PORTFOLIO SINCE INCEPTION OF THE INVESTOR CLASS THROUGH DECEMBER 1998
<TABLE>
<CAPTION>
AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Advisor Class -13.66% -3.65% 2.93% 5.10% 5.80%
Investor Class -13.72% -3.66% 2.93% 4.98% 5.75%
</TABLE>
accessor 11
<PAGE>
ACCESSOR FUNDS, INC.
INTERMEDIATE FIXED-INCOME PORTFOLIO
The Intermediate Fixed-Income Portfolio ("Intermediate Portfolio" or
"Portfolio") commenced operations on June 15, 1992. The Intermediate Portfolio
seeks generation of current income by investing primarily in fixed-income
securities with durations of between three and ten years. Under normal market
conditions, the Portfolio will have a dollar-weighted average duration of not
less than three years and not more than ten years. The Intermediate Portfolio is
designed to have risk characteristics similar to its benchmark, the Lehman
Brothers Government/Corporate Index ("Index"). The money manager of the
Portfolio is Cypress Asset Management. Effective on April 30, 1998, Smith Barney
Capital Management was terminated as the money manager of the Intermediate
Portfolio. Cypress Asset Management was hired as the money manager of the
Intermediate Portfolio on September 21, 1998. Accessor Capital Management acted
as the Portfolio manager from May 1 to September 20.
On May 1, 1998, a multi-class structure was established for the Portfolio
and a new class of shares, the Investor Class Shares, was introduced. The
Investor Class Shares are primarily available through financial institutions,
retirement plans, broker-dealers, depository institutions, institutional
shareholders of record, registered investment advisers, and other financial
intermediaries. The original shares that existed prior to May 1, 1998 were
re-designated as the Advisor Class Shares. The Investor Class Shares of the
Intermediate Portfolio were first issued on July 14, 1998.
For the Advisor Class Shares, total annualized returns for the five-year
and since inception periods ended December 31, 1998 were 6.23% and 6.87%,
respectively. For the year ended December 31, 1998, the Portfolio had a total
return of 8.38% as compared to 9.47% for the Lehman Brothers
Government/Corporate Index. Deviation from the benchmark is principally due to
the payment of operating expenses by the Portfolio, whereas the Index results do
not include expenses of any kind.
For the Investor Class Shares, total returns for the three-month and since
inception periods ended December 31, 1998 were 0.09% and 4.29%, respectively.
Cypress has developed a highly disciplined approach to managing
fixed-income portfolios. It intends to tightly control the interest rate risk
characteristics of the Portfolio to match that of the benchmark index and to
strive to provide added value mainly through security selection. In the few
months since it took over the management of the Intermediate Portfolio, Cypress
has taken advantage of the extraordinary opportunity during the financial panic
caused by the Russian default and outperformed the benchmark for that period.
accessor 12
<PAGE>
ACCESSOR FUNDS, INC.
INTERMEDIATE FIXED-INCOME PORTFOLIO
GROWTH OF $10,000 - ADVISOR CLASS SHARES
INTERMEDIATE PORTFOLIO VS. UNMANAGED LEHMAN GOVT/CORP INDEX
Historical Rates of Return*
Periods Ending December 31, 1998
One Year.........8.38%
Five Years.......6.23%
**Inception......6.87%
<TABLE>
<CAPTION>
ACCESSOR INTERMEDIATE FIXED INCOME
DATE 10,000 IN FUND 10,000 IN INDEX
<S> <C> <C>
30-Jun-92 10,000 10,000
31-Jul-92 10,213 10,228
31-Aug-92 10,339 10,324
30-Sep-92 10,483 10,465
30-Oct-92 10,303 10,316
30-Nov-92 10,222 10,292
31-Dec-92 10,371 10,450
29-Jan-93 10,598 10,665
26-Feb-93 10,787 10,860
31-Mar-93 10,840 10,900
30-Apr-93 10,923 10,986
28-May-93 10,922 10,971
30-Jun-93 11,123 11,182
31-Jul-93 11,163 11,231
31-Aug-93 11,372 11,449
30-Sep-93 11,414 11,493
29-Oct-93 11,449 11,532
30-Nov-93 11,321 11,434
31-Dec-93 11,359 11,486
31-Jan-94 11,507 11,658
28-Feb-94 11,228 11,404
31-Mar-94 10,959 11,125
30-Apr-94 10,856 11,032
31-May-94 10,831 11,012
30-Jun-94 10,785 10,987
29-Jul-94 10,969 11,207
31-Aug-94 10,965 11,211
30-Sep-94 10,809 11,042
31-Oct-94 10,779 11,030
30-Nov-94 10,728 11,010
31-Dec-94 10,764 11,083
31-Jan-95 10,941 11,296
28-Feb-95 11,171 11,558
31-Mar-95 11,253 11,635
28-Apr-95 11,391 11,797
31-May-95 11,859 12,291
30-Jun-95 11,942 12,389
31-Jul-95 11,888 12,341
31-Aug-95 12,040 12,499
29-Sep-95 12,169 12,627
31-Oct-95 12,342 12,812
30-Nov-95 12,535 13,024
29-Dec-95 12,730 13,215
31-Jan-96 12,794 13,297
29-Feb-96 12,535 13,015
29-Mar-96 12,439 12,906
30-Apr-96 12,352 12,817
31-May-96 12,335 12,795
28-Jun-96 12,489 12,966
31-Jul-96 12,508 12,996
30-Aug-96 12,462 12,965
30-Sep-96 12,673 13,196
31-Oct-96 12,943 13,503
29-Nov-96 13,204 13,752
31-Dec-96 13,055 13,599
31-Jan-97 13,055 13,615
28-Feb-97 13,080 13,641
31-Mar-97 12,923 13,479
30-Apr-97 13,108 13,676
30-May-97 13,206 13,803
30-Jun-97 13,369 13,968
31-Jul-97 13,774 14,396
29-Aug-97 13,615 14,235
30-Sep-97 13,821 14,458
31-Oct-97 14,012 14,689
28-Nov-97 14,027 14,767
31-Dec-97 14,181 14,922
30-Jan-98 14,388 15,133
27-Feb-98 14,331 15,103
31-Mar-98 14,374 15,149
30-Apr-98 14,411 15,225
29-May-98 14,576 15,388
30-Jun-98 14,713 15,545
31-Jul-98 14,720 15,557
31-Aug-98 14,980 15,861
30-Sep-98 15,334 16,314
30-Oct-98 15,207 16,199
30-Nov-98 15,309 16,296
30-Dec-98 15,370 16,335
</TABLE>
* Annualized.
** Since inception rate of return assumes initial investment on June 15, 1992.
Comparison with Lehman Brothers Government/Corporate Index assumes initial
investment on June 30, 1992.
PERFORMANCE DATA QUOTED IS HISTORICAL AND ASSUMES REINVESTMENT OF ALL DIVIDENDS
AND CAPITAL GAINS. PERFORMANCE HERE IS FOR THE ADVISOR CLASS SHARES ONLY.
INVESTOR CLASS SHARES HAVE DIFFERENT EXPENSES WHICH WILL CAUSE PERFORMANCE TO BE
DIFFERENT THAN THAT SHOWN HERE. INVESTMENT RETURN AND PRINCIPAL VALUE WILL
FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS
THAN WHEN PURCHASED. PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE RESULTS.
MONTHLY TOTAL RETURNS OF THE INTERMEDIATE
PORTFOLIO SINCE INCEPTION OF THE INVESTOR CLASS THROUGH DECEMBER 1998
<TABLE>
<CAPTION>
AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Advisor Class 1.77% 2.36% -0.83% 0.67% 0.40%
Investor Class 1.75% 2.31% -0.88% 0.63% 0.35%
</TABLE>
accessor 13
<PAGE>
ACCESSOR FUNDS, INC.
SHORT-INTERMEDIATE FIXED-INCOME PORTFOLIO
The Short-Intermediate Fixed-Income Portfolio ("Short-Intermediate
Portfolio" or "Portfolio") commenced operations on May 18, 1992. The
Short-Intermediate Portfolio seeks preservation of capital and generation of
current income by investing primarily in fixed-income securities with durations
of between one and five years. Under normal market conditions, the Portfolio
will have a dollar-weighted average duration of not less than two years and not
more than five years. The Portfolio is designed to have risk characteristics
similar to its benchmark, the Lehman Brothers Government/Corporate 1-5 Year
Index ("Index"). The money manager of the Short-Intermediate Portfolio is
Cypress Asset Management. Effective on April 30, 1998, Bankers Trust Company
resigned as the money manager of the Short-Intermediate Portfolio. Cypress Asset
Management was hired as the money manager of the Short-Intermediate Portfolio on
September 21, 1998. Accessor Capital Management acted as the Portfolio manager
from May 1 to September 20.
On May 1, 1998, a multi-class structure was established for the Portfolio
and a new class of shares, the Investor Class Shares, was introduced. The
Investor Class Shares are primarily available through financial institutions,
retirement plans, broker-dealers, depository institutions, institutional
shareholders of record, registered investment advisers, and other financial
intermediaries. The original shares that existed prior to May 1, 1998 were
re-designated as the Advisor Class Shares. The Investor Class Shares of the
Short-Intermediate Portfolio were first issued on July 14, 1998.
For the Advisor Class Shares, total annualized returns for the five-year
and since inception periods ended December 31, 1998 were 5.28% and 5.46%,
respectively. For the year ended December 31, 1998, the Portfolio had a total
return of 6.87% as compared to 7.64% for the Lehman Brothers
Government/Corporate 1-5 Year Index. Deviation from the benchmark is principally
due to the payment of operating expenses by the Portfolio, whereas the Index
results do not include expenses of any kind.
For the Investor Class Shares, total returns for the three-month and since
inception periods ended December 31, 1998 were 0.44% and 3.55%, respectively.
Cypress has developed a highly disciplined approach to managing
fixed-income portfolios. It intends to tightly control the interest rate risk
characteristics of the Portfolio to match that of the benchmark index and to
strive to provide added value mainly through security selection. In the few
months since it took over the management of the Short-Intermediate Portfolio,
Cypress has taken advantage of the extraordinary opportunity during the
financial panic caused by the Russian default and outperformed the benchmark for
that period.
accessor 14
<PAGE>
ACCESSOR FUNDS, INC.
SHORT-INTERMEDIATE FIXED-INCOME PORTFOLIO
GROWTH OF $10,000 - ADVISOR CLASS SHARES
SHORT-INTERMEDIATE PORTFOLIO VS. UNMANAGED LEHMAN GOVT/CORP 1-5 YEAR INDEX
Historical Rates of Return*
Periods Ending December 31, 1998
One Year.........6.87%
Five Years.......5.28%
**Inception......5.46%
<TABLE>
<CAPTION>
ACCESSOR SHT INTER FIXED INCOME
DATE 10,000 IN FUND 10,000 IN INDEX
<S> <C> <C>
29-May-92 10,000 10,000
30-Jun-92 10,119 10,130
31-Jul-92 10,265 10,287
31-Aug-92 10,349 10,388
30-Sep-92 10,462 10,510
30-Oct-92 10,362 10,406
30-Nov-92 10,321 10,373
31-Dec-92 10,421 10,489
29-Jan-93 10,555 10,653
26-Feb-93 10,667 10,781
31-Mar-93 10,703 10,821
30-Apr-93 10,781 10,905
28-May-93 10,749 10,872
30-Jun-93 10,848 10,991
31-Jul-93 10,863 11,013
31-Aug-93 10,965 11,145
30-Sep-93 10,989 11,182
29-Oct-93 11,009 11,211
30-Nov-93 10,971 11,188
31-Dec-93 11,006 11,234
31-Jan-94 11,095 11,330
28-Feb-94 10,977 11,216
31-Mar-94 10,858 11,104
30-Apr-94 10,800 11,040
31-May-94 10,807 11,052
30-Jun-94 10,825 11,071
29-Jul-94 10,917 11,195
31-Aug-94 10,947 11,232
30-Sep-94 10,880 11,172
31-Oct-94 10,886 11,186
30-Nov-94 10,835 11,129
31-Dec-94 10,849 11,153
31-Jan-95 11,006 11,324
28-Feb-95 11,181 11,520
31-Mar-95 11,237 11,585
28-Apr-95 11,341 11,707
31-May-95 11,580 11,978
30-Jun-95 11,630 12,049
31-Jul-95 11,648 12,078
31-Aug-95 11,727 12,164
29-Sep-95 11,784 12,233
31-Oct-95 11,883 12,351
30-Nov-95 11,989 12,482
29-Dec-95 12,088 12,590
31-Jan-96 12,186 12,706
29-Feb-96 12,103 12,620
29-Mar-96 12,052 12,580
30-Apr-96 12,030 12,570
31-May-96 12,031 12,579
28-Jun-96 12,130 12,690
31-Jul-96 12,160 12,736
30-Aug-96 12,181 12,767
30-Sep-96 12,313 12,909
31-Oct-96 12,468 13,090
29-Nov-96 12,578 13,215
31-Dec-96 12,529 13,181
31-Jan-97 12,592 13,242
28-Feb-97 12,600 13,268
31-Mar-97 12,551 13,226
30-Apr-97 12,666 13,354
30-May-97 12,740 13,452
30-Jun-97 12,837 13,558
31-Jul-97 13,007 13,758
29-Aug-97 12,967 13,739
30-Sep-97 13,091 13,867
31-Oct-97 13,215 13,992
28-Nov-97 13,217 14,018
31-Dec-97 13,320 14,121
30-Jan-98 13,463 14,284
27-Feb-98 13,445 14,284
31-Mar-98 13,483 14,334
30-Apr-98 13,540 14,405
29-May-98 13,622 14,493
30-Jun-98 13,681 14,574
31-Jul-98 13,742 14,635
31-Aug-98 13,924 14,840
30-Sep-98 14,153 15,117
30-Oct-98 14,180 15,160
30-Nov-98 14,172 15,148
30-Dec-98 14,236 15,199
</TABLE>
* Annualized.
** Since inception rate of return assumes initial investment on May 18, 1992.
Comparison with Lehman Brothers Government/Corporate 1-5 Year Index assumes
initial investment on May 31, 1992.
PERFORMANCE DATA QUOTED IS HISTORICAL AND ASSUMES REINVESTMENT OF ALL DIVIDENDS
AND CAPITAL GAINS. PERFORMANCE HERE IS FOR THE ADVISOR CLASS SHARES ONLY.
INVESTOR CLASS SHARES HAVE DIFFERENT EXPENSES WHICH WILL CAUSE PERFORMANCE TO BE
DIFFERENT THAN THAT SHOWN HERE. INVESTMENT RETURN AND PRINCIPAL VALUE WILL
FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS
THAN WHEN PURCHASED. PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE RESULTS.
MONTHLY TOTAL RETURNS OF THE SHORT-INTERMEDIATE
PORTFOLIO SINCE INCEPTION OF THE INVESTOR CLASS THROUGH DECEMBER 1998
<TABLE>
<CAPTION>
AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Advisor Class 1.32% 1.65% 0.19% -0.06% 0.45%
Investor Class 1.30% 1.61% 0.13% -0.10% 0.41%
</TABLE>
accessor 15
<PAGE>
ACCESSOR FUNDS, INC.
MORTGAGE SECURITIES PORTFOLIO
The Mortgage Securities Portfolio ("Mortgage Portfolio" or "Portfolio")
commenced operations on May 18, 1992. The Portfolio seeks generation of current
income by investing primarily in mortgage-related securities. The Portfolio is
designed to have risk characteristics similar to its benchmark, the Lehman
Brothers Mortgage-Backed Securities Index ("Index"). The money manager of the
Mortgage Portfolio is BlackRock, Inc.
On May 1, 1998, a multi-class structure was established for the Portfolio
and a new class of shares, the Investor Class Shares, was introduced. The
Investor Class Shares are primarily available through financial institutions,
retirement plans, broker-dealers, depository institutions, institutional
shareholders of record, registered investment advisers, and other financial
intermediaries. The original shares that existed prior to May 1, 1998 were
re-designated as the Advisor Class Shares. The Investor Class Shares of the
Mortgage Portfolio were first issued on July 10, 1998.
For the Advisor Class Shares, total annualized returns for the five-year
and since inception periods ended December 31, 1998 were 6.90% and 6.91%,
respectively. For the year ended December 31, 1998, the Portfolio had a total
return of 6.43% as compared to 6.97% for the Lehman Brothers Mortgage-Backed
Securities Index. Deviation from the benchmark is principally due to the payment
of operating expenses by the Portfolio, whereas the Index results do not include
expenses of any kind.
For the Investor Class Shares, total returns for the three-month and since
inception periods ended December 31, 1998 were 1.00% and 2.46%, respectively.
Wide swings in interest rates and yield spreads provide a very challenging
environment for mortgage-backed securities. In addition to the credit crisis
precipitated by the Russian default, the rapid growth of non-federal debt and a
net reduction of federal debt also contributed to the widening credit spread
(the yield spread between Treasury bonds and corporate and mortgage bonds).
Nevertheless, the money manager of the Mortgage Portfolio produced satisfactory
performance through its disciplined and quantitatively sophisticated investment
process.
accessor 16
<PAGE>
ACCESSOR FUNDS, INC.
MORTGAGE SECURITIES PORTFOLIO
GROWTH OF $10,000 - ADVISOR CLASS SHARES
MORTGAGE PORTFOLIO VS. UNMANAGED LEHMAN MORTGAGE-BACKED INDEX
Historical Rates of Return*
Periods Ending December 31, 1998
One Year.........6.43%
Five Years.......6.90%
**Inception......6.91%
<TABLE>
<CAPTION>
ACCESSOR MORTGAGE SECURITIES
DATE 10,000 IN FUND 10,000 IN INDEX
<S> <C> <C>
29-May-92 10,000 10,000
30-Jun-92 10,095 10,118
31-Jul-92 10,271 10,207
31-Aug-92 10,356 10,340
30-Sep-92 10,413 10,420
30-Oct-92 10,259 10,329
30-Nov-92 10,244 10,361
31-Dec-92 10,379 10,494
29-Jan-93 10,545 10,632
26-Feb-93 10,662 10,739
31-Mar-93 10,705 10,805
30-Apr-93 10,754 10,861
28-May-93 10,773 10,923
30-Jun-93 10,922 11,006
31-Jul-93 10,981 11,050
31-Aug-93 11,049 11,102
30-Sep-93 11,062 11,112
29-Oct-93 11,089 11,144
30-Nov-93 11,067 11,122
31-Dec-93 11,133 11,212
31-Jan-94 11,240 11,323
28-Feb-94 11,133 11,244
31-Mar-94 10,998 10,951
30-Apr-94 10,910 10,870
31-May-94 10,899 10,914
30-Jun-94 10,867 10,890
29-Jul-94 11,076 11,107
31-Aug-94 11,071 11,143
30-Sep-94 10,917 10,985
31-Oct-94 10,902 10,978
30-Nov-94 10,861 10,944
31-Dec-94 10,949 11,032
31-Jan-95 11,176 11,268
28-Feb-95 11,445 11,555
31-Mar-95 11,509 11,609
28-Apr-95 11,650 11,774
31-May-95 12,010 12,145
30-Jun-95 12,089 12,214
31-Jul-95 12,086 12,235
31-Aug-95 12,197 12,362
29-Sep-95 12,297 12,471
31-Oct-95 12,398 12,582
30-Nov-95 12,563 12,726
29-Dec-95 12,705 12,885
31-Jan-96 12,775 12,981
29-Feb-96 12,653 12,874
29-Mar-96 12,596 12,827
30-Apr-96 12,560 12,791
31-May-96 12,531 12,754
28-Jun-96 12,684 12,930
31-Jul-96 12,720 12,978
30-Aug-96 12,713 12,978
30-Sep-96 12,932 13,195
31-Oct-96 13,171 13,453
29-Nov-96 13,408 13,646
31-Dec-96 13,337 13,575
31-Jan-97 13,411 13,675
28-Feb-97 13,461 13,720
31-Mar-97 13,306 13,591
30-Apr-97 13,548 13,808
30-May-97 13,693 13,943
30-Jun-97 13,848 14,106
31-Jul-97 14,086 14,371
29-Aug-97 14,058 14,337
30-Sep-97 14,249 14,519
31-Oct-97 14,423 14,680
28-Nov-97 14,455 14,728
31-Dec-97 14,608 14,862
30-Jan-98 14,789 15,010
27-Feb-98 14,776 15,041
31-Mar-98 14,829 15,104
30-Apr-98 14,920 15,190
29-May-98 15,023 15,291
30-Jun-98 15,090 15,364
31-Jul-98 15,161 15,442
31-Aug-98 15,290 15,583
30-Sep-98 15,374 15,771
30-Oct-98 15,362 15,751
30-Nov-98 15,472 15,830
30-Dec-98 15,547 15,898
</TABLE>
* Annualized.
** Since inception rate of return assumes initial investment on May 18, 1992.
Comparison with Lehman Brothers Mortgage-Backed Index assumes initial investment
on May 31, 1992.
PERFORMANCE DATA QUOTED IS HISTORICAL AND ASSUMES REINVESTMENT OF ALL DIVIDENDS
AND CAPITAL GAINS. PERFORMANCE HERE IS FOR THE ADVISOR CLASS SHARES ONLY.
INVESTOR CLASS SHARES HAVE DIFFERENT EXPENSES WHICH WILL CAUSE PERFORMANCE TO BE
DIFFERENT THAN THAT SHOWN HERE. INVESTMENT RETURN AND PRINCIPAL VALUE WILL
FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS
THAN WHEN PURCHASED. PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE RESULTS.
MONTHLY TOTAL RETURNS OF THE MORTGAGE PORTFOLIO SINCE INCEPTION OF THE
INVESTOR CLASS THROUGH DECEMBER 1998
<TABLE>
<CAPTION>
AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Advisor Class 0.85% 0.55% -0.08% 0.72% 0.48%
Investor Class 0.82% 0.51% -0.12% 0.68% 0.44%
</TABLE>
accessor 17
<PAGE>
ACCESSOR FUNDS, INC.
U.S. GOVERNMENT MONEY PORTFOLIO
The U.S. Government Money Portfolio ("Portfolio") commenced operations on
April 9, 1992. The Portfolio seeks maximum current income consistent with the
preservation of principal and liquidity by investing primarily in short-term
obligations issued or guaranteed by the U.S. Government, its agencies or
instrumentalities. The U.S. Government Money Portfolio is managed by Accessor
Capital Management L.P.
On May 1, 1998, a multi-class structure was established for the Portfolio
and a new class of shares, the Investor Class Shares, was introduced. The
Investor Class Shares are primarily available through financial institutions,
retirement plans, broker-dealers, depository institutions, institutional
shareholders of record, registered investment advisers, and other financial
intermediaries. The original shares that existed prior to May 1, 1998 were
re-designated as the Advisor Class Shares. The Investor Class Shares of the U.S.
Government Money Portfolio were first issued on July 29, 1998.
For the Advisor Class Shares, total annualized returns for the five-year
and since inception periods ended December 31, 1998 were 4.77% and 4.32%,
respectively. For the year ended December 31, 1998, the Portfolio had a total
return of 5.00%.
For the Investor Class Shares, total returns for the three-month and since
inception periods ended December 31, 1998 were 1.07% and 1.83%, respectively.
A healthy U.S. economy, low inflation, low interest rates, and high
consumer confidence continued to fuel the booming housing market in 1998. As a
result, there were high levels of discount note issuance by the government
agencies such as Fannie Mae, Freddie Mac, and Federal Home Loan Bank. As these
agency discount notes offered attractive yield spreads over Treasury Bills of
similar maturities, the bulk of the assets in the U.S. Government Money
Portfolio were invested in these securities. The assets in the U.S. Government
Money Portfolio more than tripled in 1998, with the majority of the cash inflows
received during the second half of the year. The timing of the cash inflows
proved to be beneficial to the Portfolio, since we were able to take advantage
of the extraordinarily wide yield spread between the agency discount notes and
T-bills during the aforementioned credit crunch precipitated by the Russian debt
default. The competitive yield of the U.S. Government Money Portfolio compared
favorably with other U.S. Government money funds as ranked by IBC's Money Fund
Report.
accessor 18
<PAGE>
ACCESSOR FUNDS, INC.
U.S. GOVERNMENT MONEY PORTFOLIO
GROWTH OF $10,000 - ADVISOR CLASS SHARES
U.S. GOVERNMENT MONEY PORTFOLIO
Historical Rates of Return*
Periods Ending December 31, 1998
One Year.........5.00%
Five Years.......4.77%
**Inception......4.32%
<TABLE>
<CAPTION>
ACCESSOR US GOVERNMENT MONEY
DATE 10,000 IN FUND
<S> <C>
9-Apr-92 10,000
29-May-92 10,030
30-Jun-92 10,060
31-Jul-92 10,091
31-Aug-92 10,120
30-Sep-92 10,144
30-Oct-92 10,169
30-Nov-92 10,192
31-Dec-92 10,217
29-Jan-93 10,242
26-Feb-93 10,263
31-Mar-93 10,286
30-Apr-93 10,309
28-May-93 10,332
30-Jun-93 10,354
30-Jul-93 10,378
31-Aug-93 10,402
30-Sep-93 10,425
29-Oct-93 10,449
30-Nov-93 10,473
31-Dec-93 10,505
31-Jan-94 10,529
28-Feb-94 10,551
31-Mar-94 10,576
29-Apr-94 10,604
31-May-94 10,634
30-Jun-94 10,665
29-Jul-94 10,699
31-Aug-94 10,734
30-Sep-94 10,769
31-Oct-94 10,807
30-Nov-94 10,846
31-Dec-94 10,893
31-Jan-95 10,940
28-Feb-95 10,984
31-Mar-95 11,034
28-Apr-95 11,084
31-May-95 11,135
30-Jun-95 11,185
31-Jul-95 11,235
31-Aug-95 11,285
29-Sep-95 11,333
31-Oct-95 11,379
30-Nov-95 11,415
29-Dec-95 11,462
31-Jan-96 11,490
29-Feb-96 11,532
29-Mar-96 11,576
30-Apr-96 11,620
31-May-96 11,667
28-Jun-96 11,708
31-Jul-96 11,755
30-Aug-96 11,803
30-Sep-96 11,846
31-Oct-96 11,896
29-Nov-96 11,935
31-Dec-96 11,978
31-Jan-97 12,027
28-Feb-97 12,071
31-Mar-97 12,121
30-Apr-97 12,170
30-May-97 12,222
30-Jun-97 12,272
31-Jul-97 12,325
31-Aug-97 12,377
30-Sep-97 12,429
31-Oct-97 12,482
28-Nov-97 12,533
31-Dec-97 12,585
30-Jan-98 12,638
27-Feb-98 12,686
31-Mar-98 12,740
30-Apr-98 12,792
29-May-98 12,846
30-Jun-98 12,897
31-Jul-98 12,951
31-Aug-98 13,006
30-Sep-98 13,059
30-Oct-98 13,115
30-Nov-98 13,165
30-Dec-98 13,216
</TABLE>
* Annualized.
** Since inception rate of return assumes initial investment on April 9, 1992.
PERFORMANCE DATA QUOTED IS HISTORICAL AND ASSUMES REINVESTMENT OF ALL DIVIDENDS
AND CAPITAL GAINS. PERFORMANCE HERE IS FOR THE ADVISOR CLASS SHARES ONLY.
INVESTOR CLASS SHARES HAVE DIFFERENT EXPENSES WHICH WILL CAUSE PERFORMANCE TO BE
DIFFERENT THAN THAT SHOWN HERE. INVESTMENT RETURN AND PRINCIPAL VALUE WILL
FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS
THAN WHEN PURCHASED. PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE RESULTS. AN
INVESTMENT IN THE U.S. GOVERNMENT MONEY FUND IS NEITHER INSURED NOR GUARANTEED
BY THE U.S. GOVERNMENT AND THERE CAN BE NO ASSURANCE THAT THE FUND WILL BE ABLE
TO MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.
MONTHLY TOTAL RETURNS OF THE U.S. GOVERNMENT MONEY PORTFOLIO
SINCE INCEPTION OF THE INVESTOR CLASS THROUGH DECEMBER 1998
<TABLE>
<CAPTION>
AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Advisor Class 1.32% 1.65% 0.19% -0.06% 0.45%
Investor Class 1.30% 1.61% 0.13% -0.10% 0.41%
</TABLE>
accessor 19
<PAGE>
ACCESSOR FUNDS, INC.
GROWTH PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK (98.9%)
ADVERTISING (1.0%)
Interpublic Group Companies, Inc. 12,200 $ 972,946
Omnicom Group 14,100 817,800
-------------------
1,790,746
AIR TRAVEL (0.3%)
Southwest Airlines Company 25,950 582,253
-------------------
582,253
APPAREL (0.9%)
Gap, Inc. 29,550 1,662,188
-------------------
1,662,188
BANKS/SAVINGS & LOANS (4.0%)
Chase Manhattan Corporation 33,800 2,300,512
Fifth Third Bancorp 17,050 1,215,878
MBNA Corporation 42,675 1,064,208
National City Corporation 23,400 1,696,500
US Bancorporation 24,900 883,950
-------------------
7,161,048
BEVERAGES - SOFT DRINKS (2.7%)
Coca-Cola Company 71,600 4,788,250
-------------------
4,788,250
BREWERY (0.9%)
Anheuser Busch Companies, Inc. 24,300 1,594,688
-------------------
1,594,688
BROKERAGES (0.2%)
Charles Schwab Cp New 6,600 370,838
-------------------
370,838
BUSINESS SERVICES (1.7%)
Automatic Data Processing 20,100 1,611,768
Equifax, Inc. 17,000 581,188
Paychex, Inc. 16,100 828,144
-------------------
3,021,100
COMMERCIAL SERVICES (1.3%)
Ecolab, Inc. 21,800 788,887
Pitney-Bowes, Inc. 23,900 1,578,894
-------------------
2,367,781
COMPUTER SOFTWARE & SERVICES (13.6%)
America Online, Inc. 31,700 4,588,574
Cisco Systems, Inc.* 90,600 8,408,813
Microsoft Corporation* 83,000 11,511,063
-------------------
24,508,450
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 20
<PAGE>
ACCESSOR FUNDS, INC.
GROWTH PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
COMPUTER SYSTEMS & SERVICES (6.0%)
Ascend Communications, Inc. 14,200 $ 933,650
Computer Sciences Corporation 7,100 457,506
Dell Computer Corporation* 55,100 4,032,631
EMC Corporation 23,300 1,980,500
International Business Machines Corporation 18,000 3,325,500
-------------------
10,729,787
COSMETICS & TOILETRIES (0.5%)
Colgate-Palmolive Company 10,300 956,613
-------------------
956,613
DRUGS & PHARMACEUTICALS (17.2%)
Abbott Laboratories 78,050 3,824,450
American Home Products Corporation 36,100 2,032,880
Bristol-Myers Squibb Company 36,000 4,817,250
Eli Lilly & Company 26,900 2,390,738
Johnson & Johnson 30,800 2,583,350
Merck & Company 14,200 2,097,163
Pfizer, Inc. 39,885 5,003,075
Schering-Plough Corporation 65,200 3,602,300
Warner Lambert Company 61,700 4,639,069
-------------------
30,990,275
ELECTRONICS (3.9%)
Intel Corporation 58,800 6,995,188
-------------------
6,995,188
FINANCE (2.8%)
Capital One Financial 10,025 1,152,875
Federal Home Loan Association 59,600 3,840,475
------------------
4,993,350
FOODS (2.5%)
Bestfoods, Inc. 16,400 873,300
Campbell Soup Company 9,400 517,000
ConAgra, Inc. 15,300 481,950
General Mills, Inc. 4,400 342,100
H.J. Heinz Company 12,300 696,487
Quaker Oats Company 11,200 666,400
SYSCO Corporation 20,500 562,469
Wrigley Wm. Jr. Company 4,600 411,988
--------------------
4,551,694
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 21
<PAGE>
ACCESSOR FUNDS, INC.
GROWTH PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
HOSPITAL MANAGEMENT (0.8%)
Cardinal Health, Inc. 18,000 $ 1,365,750
-------------------
1,365,750
HOUSEHOLD PRODUCTS (1.6%)
Clorox Company 12,000 1,401,750
Unilever NV 17,300 1,434,819
-------------------
2,836,569
INSURANCE (2.6%)
Berkshire Hathaway Class B 1,397 3,282,950
Providian Financial Corporation 18,900 1,417,500
-------------------
4,700,450
MANUFACTURING - DIVERSIFIED (7.1%)
General Electric Company 112,100 11,441,206
Illinois Tool Works 13,300 771,400
United Technologies Corporation 5,400 587,250
-------------------
12,799,856
MEDIA (0.7%)
Comcast Corporation Class A 22,600 1,326,338
-------------------
1,326,338
MEDICAL SUPPLIES (2.1%)
Amgen, Inc.* 11,200 1,171,100
Biomet, Inc. 12,000 483,000
Guidant Corporation 19,100 2,105,775
-------------------
3,759,875
OFFICE EQUIPMENT & SUPPLIES (1.4%)
Staples, Inc. 42,000 1,834,875
Xerox Corporation 5,900 696,200
-------------------
2,531,075
PRINTING & PUBLISHING (0.1%)
Meredith Corporation 5,900 223,463
-------------------
223,463
PUBLISHING NEWS (0.6%)
Gannett Company, Inc. 15,300 1,012,669
-------------------
1,012,669
RETAIL - GROCERY (1.0%)
Kroger Company 7,400 447,700
Safeway, Inc. 23,000 1,401,563
-------------------
1,849,263
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 22
<PAGE>
ACCESSOR FUNDS, INC.
GROWTH PORTFOLIO
SCHEDULE OF INVESTMENTS - concluded
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
RETAIL - TRADE (8.8%)
Costco Companies, Inc.* 13,000 $ 938,437
Dayton Hudson Corporation 17,000 922,250
Home Depot, Inc. 71,200 4,356,550
Kohls Corporation 16,600 1,019,863
TJX Companies, Inc. 37,500 1,087,500
Wal-Mart Stores, Inc. 83,100 6,767,456
Walgreen Company 13,200 773,025
-------------------
15,865,081
STOCK EQUIVALENT (3.2%)
Standard & Poors Depository Receipts 46,300 5,694,900
-------------------
5,694,900
TELECOMMUNICATIONS (9.4%)
AirTouch Communications, Inc.* 20,000 1,442,500
Ameritech Corporation 33,000 2,091,375
Lucent Technologies, Inc. 34,500 3,795,000
MCI WorldCom, Inc. 89,000 6,385,750
SBC Communications, Inc. 57,300 3,072,713
-------------------
16,787,338
TOTAL INVESTMENTS (98.9%) (IDENTIFIED COST $125,354,904)(1) 177,816,876
OTHER ASSETS LESS LIABILITIES (1.1%) 2,059,489
-------------------
NET ASSETS (100.0%) $ 179,876,365
-------------------
-------------------
</TABLE>
* Non-income producing security.
(1) See Note 6 for important tax information.
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 23
<PAGE>
ACCESSOR FUNDS, INC.
VALUE AND INCOME PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK (98.6%)
ADVERTISING (0.3%)
Interpublic Group of Companies, Inc. 5,600 $ 446,600
---------------------
446,600
AEROSPACE - DEFENSE (1.4%)
General Dynamics Corporation 1,800 105,523
Goodrich (B.F.) Company 35,300 1,266,388
Lockheed Martin Corporation 5,200 440,700
---------------------
1,812,611
AIR TRAVEL (1.3%)
AMR Corporation* 10,500 623,435
Delta Air Lines, Inc. 19,000 988,000
---------------------
1,611,435
AUTOMOBILES (2.1%)
Ford Motor Company 36,800 2,159,700
General Motors Corporation 7,900 565,344
---------------------
2,725,044
BANKS/SAVINGS & LOANS (14.2%)
Bank One Corporation 64,200 3,278,211
BankAmerica Corporation 40,423 2,430,433
Chase Manhattan Corporation 10,300 701,044
Citigroup, Inc. 39,100 1,935,450
Comerica, Inc. 22,200 1,513,763
First Union Corporation 48,900 2,973,731
Fleet Financial Group, Inc. 45,100 2,015,406
PNC Bank Corporation 32,500 1,759,063
Republic Of New York Corporation 15,200 692,550
Washington Mutual, Inc. 19,700 752,294
---------------------
18,051,945
BROKERAGES (2.3%)
Lehman Brothers Holdings, Inc. 22,100 973,781
Morgan Stanley Dean Witter & Company 28,100 1,995,100
---------------------
2,968,881
BUILDING & CONSTRUCTION (0.7%)
Centex Corporation 12,600 567,788
Fleetwood Enterprises 8,200 284,950
---------------------
852,738
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 24
<PAGE>
ACCESSOR FUNDS, INC.
VALUE AND INCOME PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
BUSINESS SERVICES (0.4%)
Shared Medical Systems 10,700 $ 533,663
---------------------
533,663
CHEMICALS (1.7%)
Engelhard Corporation 55,000 1,072,500
Grace (WR) & Company 66,000 1,035,375
---------------------
2,107,875
COMPUTER SOFTWARE & SERVICES (1.9%)
Adobe Systems, Inc. 2,000 93,500
Autodesk, Inc. 16,000 683,000
BMC Software, Inc. 7,400 329,762
Computer Associates 14,700 626,588
Sun Microsystems, Inc.* 7,900 676,438
---------------------
2,409,288
COMPUTER SYSTEMS & SERVICES (4.5%)
Apple Computer, Inc.* 39,000 1,596,562
Cabletron Systems, Inc. 7,900 66,163
Compaq Computer Company 32,500 1,362,969
Gateway 2000 1,200 61,425
Hewlett Packard Company 12,100 826,581
International Business Machines Corporation 9,700 1,792,075
---------------------
5,705,775
DRUGS & PHARMACEUTICALS (1.6%)
Amgen, Inc.* 18,700 1,955,319
Warner Lambert 1,500 112,781
---------------------
2,068,100
ELECTRICAL UTILITIES (3.5%)
DTE Energy Company 30,800 1,320,550
FirstEngery Corporation 42,000 1,367,625
GPU, Inc. 11,100 490,481
Houston Industries 4,600 147,775
Public Service Enterprise Group 29,400 1,176,000
---------------------
4,502,431
ELECTRONICS (1.2%)
Advanced Micro Devices 5,500 159,156
Tandy Corporation 18,900 778,444
Texas Instrument, Inc. 7,700 658,831
---------------------
1,596,431
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 25
<PAGE>
ACCESSOR FUNDS, INC.
VALUE AND INCOME PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
ENTERTAINMENT & LEISURE (0.8%)
Brunswick Corporation 18,000 $ 445,500
The Walt Disney Company 18,400 552,000
---------------------
997,500
FINANCE (3.2%)
Countrywide Credit Industry, Inc. 21,400 1,074,012
Federal National Mortgage Company 14,300 1,058,200
Household International 35,800 1,418,575
MBNA Corporation 19,300 481,294
---------------------
4,032,081
FOODS (1.0%)
Fleming Companies, Inc. 41,900 434,713
Quaker Oats Company 8,700 517,650
Supervalu, Inc. 11,700 327,600
---------------------
1,279,963
HOSPITAL MANAGEMENT (0.4%)
HEALTHSOUTH Corporation 33,800 521,788
---------------------
521,788
HOUSEHOLD PRODUCTS (2.1%)
Clorox 9,300 1,086,356
Fort James Corporation 31,100 1,244,000
Owens Illinois, Inc.* 13,400 410,375
---------------------
2,740,731
INSURANCE (6.4%)
Allstate Corporation 52,100 2,012,363
CIGNA Corporation 24,700 1,909,619
Conseco, Inc. 45,200 1,381,425
Jefferson Pilot Company 10,000 750,000
Loews Corporation 7,400 727,050
MGIC Investment Corporation 31,700 1,262,056
Provident Companies 3,500 145,250
---------------------
8,187,763
MACHINERY (2.4%)
Caterpillar, Inc. 12,100 556,600
Dana Corporation 25,200 1,030,050
Ingersoll-Rand Company 31,000 1,455,063
---------------------
3,041,713
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 26
<PAGE>
ACCESSOR FUNDS, INC.
VALUE AND INCOME PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
MANUFACTURING - DIVERSIFIED (2.8%)
Crane Company 31,900 $ 962,981
Eastman Kodak 16,000 1,152,000
FMC Corporation* 3,600 201,600
Honeywell, Inc. 9,200 692,875
Johnson Controls, Inc. 9,600 566,400
---------------------
3,575,856
MEDIA (3.7%)
King World Productions 43,200 1,271,700
Mallinckrodt, Inc. 32,200 992,163
Time Warner, Inc. 18,400 1,141,950
Viacom Class B* 18,500 1,369,000
---------------------
4,774,813
METALS (1.3%)
Barrick Gold Corporation 27,600 538,200
Reynolds Metals Company 22,000 1,159,125
---------------------
1,697,325
OIL & GAS (13.8%)
Apache Corporation 55,600 1,407,372
Ashland, Inc. 25,100 1,214,213
Chevron Corporation 6,200 514,213
Coastal Corporation 41,800 1,460,388
Exxon Corporation 83,900 6,135,188
Helmerich & Payne, Inc. 45,600 883,500
Mobil Corporation 12,400 1,080,350
Phillips Petroleum Company 7,500 319,688
Royal Dutch Petroleum Company 54,300 2,599,613
Texaco, Inc. 29,900 1,580,963
USX-Marathon Group 16,100 485,013
---------------------
17,680,501
PRINTING & PUBLISHING (1.6%)
Meredith Corporation 21,600 818,100
Tribune Company 18,900 1,247,400
---------------------
2,065,500
PUBLISHING NEWS (1.1%)
Gannett Company, Inc. 20,500 1,356,844
---------------------
1,356,844
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 27
<PAGE>
ACCESSOR FUNDS, INC.
VALUE AND INCOME PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
RETAIL - TRADE (3.5%)
Federated Department Stores* 19,100 $ 832,044
Kmart Corporation* 60,700 929,469
Sears, Roebuck & Company 35,000 1,487,500
TJX Companies, Inc. 44,200 1,281,800
---------------------
4,530,813
RESTAURANTS (0.7%)
McDonalds Corporation 2,800 214,550
Ryan's Steak House, Inc.* 51,400 636,075
---------------------
850,625
TECHNOLOGY (1.0%)
Intel Corporation 11,300 1,339,756
---------------------
1,339,756
TELECOMMUNICATIONS (11.1%)
AT&T Company 71,100 5,350,274
AirTouch Communications 1,300 93,763
Bell Atlantic Corporation 90,400 4,508,700
GTE Corporation 8,100 546,244
General Instrument Corporation* 15,000 509,063
MCI Worldcom, Inc. 31,400 2,252,950
SBC Communications, Inc. 16,400 879,450
---------------------
14,140,444
TELECOMMUNICATION - EQUIPMENT (0.6%)
Andrew Corporation* 39,900 658,350
Lucent Technologies, Inc. 800 88,000
---------------------
746,350
TRANSPORATION (1.1%)
Burlington Nothern Santa Fe 9,600 324,000
Laidlaw, Inc. 28,800 289,800
Navistar International 26,800 763,800
---------------------
1,377,600
TRUCKING (0.5%)
Ryder Systems, Inc. 24,700 642,200
---------------------
642,200
UTILITIES (2.4%)
Columbia Energy Group 24,300 1,403,325
Peco Energy Company 39,300 1,635,863
---------------------
3,039,188
TOTAL COMMON STOCK (IDENTIFIED COST $110,910,278) 126,012,171
---------------------
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 28
<PAGE>
ACCESSOR FUNDS, INC.
VALUE AND INCOME PORTFOLIO
SCHEDULE OF INVESTMENTS - concluded
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
INTEREST MATURITY
DESCRIPTION RATE DATE VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
SHORT-TERM INVESTMENTS (1.3%)
U.S. Treasury Bills(1)(2) 4.320% 03/18/99 $ 604,619
Fifth Third Bank Repurchase Agreement dated 4.220% 01/04/99 1,005,791
12/31/98 (collateralized by 998,000 U.S. FHLMC ---------------------
#G10657, 7.50%, 02/01/12 market value $1,026,068)
TOTAL SHORT-TERM INVESTMENTS 1,610,410
(IDENTIFIED COST $1,610,448) ---------------------
TOTAL INVESTMENTS (99.9%) (IDENTIFIED COST $112,520,726)(3) 127,622,581
OTHER ASSETS LESS LIABILITIES (0.1%) 92,633
---------------------
NET ASSETS (100.0%) $ 127,715,214
---------------------
---------------------
</TABLE>
OUTSTANDING FUTURES CONTRACTS
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
UNITS PER CURRENT UNREALIZED
TYPE EXPIRATION CONTRACTS CONTRACT VALUE APPRECIATION
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
S&P 500 Futures 03/22/99 6 250 $1,868,250 $93,750
</TABLE>
* Non-income producing security.
(1) Yield at time of purchase.
(2) Security has been segregated with the custodian to cover margin requirements
for the open futures contracts at December 31, 1998 as collateral.
(3) See Note 6 for important tax information.
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 29
<PAGE>
ACCESSOR FUNDS, INC.
SMALL TO MID CAP PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK (98.8%)
ADVERTISING (1.1%)
Valassis Communications* 59,500 $ 3,071,864
---------------------
3,071,864
AEROSPACE - DEFENSE (1.9%)
Gulfstream Aerospace Corporation* 98,700 5,255,775
---------------------
5,255,775
AIR TRAVEL (1.0%)
Alaska Air Group, Inc. 14,500 641,915
Midwest Express Holdings* 48,100 1,265,631
UAL Corporation* 13,700 817,719
---------------------
2,725,265
APPAREL (5.6%)
Abercrombie & Fitch, Class A* 96,200 6,806,150
American Eagle Outfitters 26,900 1,792,271
Ann Taylor Stores Corporation 17,500 690,156
The Buckle, Inc.* 65,250 1,566,000
Fossil, Inc.* 78,250 2,249,748
Intimate Brands, Inc. 74,100 2,213,947
Jones Apparel Group, Inc. 15,100 333,144
---------------------
15,651,416
AUTOMOTIVE PARTS & EQUIPTMENT (1.2%)
Arvin Industries, Inc. 73,500 3,064,031
Borg-Warner Automotive, Inc. 5,700 318,246
---------------------
3,382,277
BANKS/SAVINGS & LOANS (8.5%)
AmSouth Bancorporation 134,600 6,141,221
City National Corporation 115,700 4,816,125
Commerce Bancorp Inc. New Jersey 15,125 794,063
Commerce Bancshares, Inc. 21,840 928,200
Dime Bancorp Inc. 134,200 3,548,665
First Citizens Bancshares, Corporation 1,400 126,000
FirstFed Financial Corporation* 72,200 1,290,575
M & T Bank Corporation 2,200 1,141,670
North Fork Bancorporation 75,552 1,808,830
Old Kent Financial Corporation 35,800 1,664,914
Popular, Inc. 31,600 1,074,400
T R Financial Corporation 11,200 441,000
---------------------
23,775,663
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 30
<PAGE>
ACCESSOR FUNDS, INC.
SMALL TO MID CAP PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
BROKERAGES (0.8%)
A.G. Edwards, Inc. 56,400 $ 2,100,900
Paine Webber Group, Inc. 4,900 189,263
---------------------
2,290,163
BUILDING & CONSTRUCTION (3.0%)
Dycom Industries, Inc. 15,800 902,575
DR Horton, Inc. 67,700 1,557,100
Lafarge Corporation 21,500 870,750
Lennar Corporation 35,500 896,375
Martin Marietta Materials 9,100 565,906
NVR, Inc.* 16,100 767,769
USG Corporation 53,200 2,709,875
---------------------
8,270,350
BUSINESS SERVICES (5.9%)
Advo Inc.* 36,700 967,960
American Management Systems, Inc.* 48,200 1,928,000
Comdisco, Inc. 190,900 3,221,438
MAXIMUS, Inc. 8,700 322,074
Metzler Group 26,600 1,295,140
National Data Corporation 5,100 248,408
Omnicare 86,100 2,991,975
Personnel Group Of America, Inc.* 49,900 873,250
Robert Half International, Inc.* 75,900 3,391,781
Sabre Group Holdings, Inc.* 21,600 961,294
StaffMark, Inc.* 20,900 467,638
---------------------
16,668,958
CHEMICALS (2.1%)
Waters Corporation* 66,600 5,810,888
---------------------
5,810,888
COMMERCIAL SERVICES (3.6%)
Arrow Electronics 64,800 1,729,850
Hertz Corporation 120,700 5,506,935
US Foodservice 13,200 646,800
Viad Corporation 76,100 2,311,538
---------------------
10,195,123
COMPUTER SOFTWARE & SERVICES (5.3%)
Citrix Systems, Inc. 11,200 1,087,436
CIBER, Inc.* 58,400 1,631,550
Compuware Corporation 14,300 1,117,188
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 31
<PAGE>
ACCESSOR FUNDS, INC.
SMALL TO MID CAP PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
COMPUTER SOFTWARE & SERVICES (CONTINUED)
Electronic Arts, Inc. 8,700 $ 488,288
Hyperion Solutions Corporation 21,500 387,645
IMRglobal Corporation 34,700 1,021,481
Keane, Inc.* 152,700 6,098,540
New Era Of Networks, Inc. 12,300 541,200
Siebel Systems, Inc. 28,000 950,250
Sterling Software, Inc.* 9,200 248,975
VERITAS Software Corporation 2,400 143,914
Yahoo!, Inc. 4,400 1,042,657
---------------------
14,759,124
COMPUTER SYSTEMS & SERVICES (1.3%)
Adaptec, Inc. 25,600 501,556
Comverse Technology, Inc. 17,800 1,263,800
Network Appliance Inc. 40,000 1,800,000
Semtech Corporation* 3,300 118,388
---------------------
3,683,744
COSMETICS (0.1%)
Estee Lauder Companies Class A 1,600 136,832
---------------------
136,832
DRUGS & PHARMACEUTICALS (4.9%)
Alpharma Class A, Inc. 44,700 1,578,468
Bindley Western Industries, Inc. 73,866 3,637,901
McKesson Corporation 74,800 5,913,875
Medicis Pharmaceutical 5,300 316,013
MedImune, Inc. 24,100 2,396,444
---------------------
13,842,701
ELECTRICAL EQUIPMENT (0.4%)
C&D Technologies, Inc. 39,600 1,089,000
---------------------
1,089,000
ELECTRICAL UTILITIES (3.4%)
Allegheny Energy, Inc. 20,200 696,900
Energy East Corporation 83,400 4,712,100
Florida Progress Corporation 19,100 855,919
OGE Energy Corporation 43,800 1,270,200
UtiliCorp United, Inc. 55,100 2,021,985
------------------------
9,557,104
ELECTRONICS (3.5%)
Altera Corporation 33,000 2,009,604
Jabil Circuit, Inc.* 21,100 1,572,372
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 32
<PAGE>
ACCESSOR FUNDS, INC.
SMALL TO MID CAP PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
ELECTRONICS (CONTINUED)
QLogic Corporation 34,700 $ 4,541,363
Sanmina Corporation* 27,100 1,693,750
---------------------
9,817,089
ENTERTAINMENT & LEISURE (0.5%)
Harley-Davidson, Inc. 12,200 577,975
Pixar, Inc. 26,500 927,779
---------------------
1,505,754
FINANCE (0.2%)
FIRSTPLUS Financial Group, Inc. 12,900 35,475
FINOVA Group, Inc. 9,800 528,588
---------------------
564,063
FOODS (2.2%)
Earthgrains Company 26,100 807,469
Fleming Companies, Inc. 21,000 217,875
IBP, Inc. 179,400 5,225,137
---------------------
6,250,481
FURNITURE & FIXTURES (0.3%)
La-Z-Boy, Inc. 52,300 931,594
---------------------
931,594
HOSPITAL MANAGEMENT (0.2%)
Total Renal Care Holdings 21,600 638,550
---------------------
638,550
HOUSEHOLD PRODUCTS (0.3%)
Dial Corporation 32,700 944,213
---------------------
944,213
INSURANCE (9.9%)
AFLAC, Inc. 23,400 1,029,600
Ambac Financial Group, Inc. 28,600 1,721,360
Berkshire Hathaway, Inc.* 113 7,910,000
Fidelity National Financial, Inc. 122,320 3,731,005
Financial Security Assurance Holdings 40,900 2,218,825
First American Financial 170,200 5,467,761
Hartford Life Class A 34,900 2,032,925
Stewart Information Services 34,600 2,006,800
Wellpoint Health Networks, Inc.* 17,700 1,539,900
---------------------
27,658,176
MACHINERY (2.2%)
Applied Power, Inc. Class A 5,400 202,608
Gardner Denver, Inc.* 51,900 765,647
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 33
<PAGE>
ACCESSOR FUNDS, INC.
SMALL TO MID CAP PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
MACHINERY (CONTINUED)
Manitowoc Company, Inc. 45,900 $ 2,036,883
Terex Corporation* 91,700 2,619,288
Trinity Industries, Inc. 11,300 435,050
---------------------
6,059,476
MANAGED CARE (1.9%)
Trigon Healthcare Inc.* 52,200 1,947,737
PacifiCare Health Systems, Inc. 40,800 3,243,768
---------------------
5,191,505
MANUFACTURING - DIVERSIFIED (2.6%)
Carlisle Companies Inc. 21,500 1,109,984
General Cable Corporation 44,700 916,546
Pentair, Inc. 14,400 573,300
Smith (A.O.) Corporation 11,350 278,784
SPS Technologies, Inc.* 18,200 1,030,575
Tredegar Industries, Inc. 47,100 1,059,750
YORK International Corporation New 55,500 2,265,192
---------------------
7,234,131
MEDIA (0.1%)
Cox Communications, Inc. 300 20,738
Jacor Communications 1,600 103,000
---------------------
123,738
MEDICAL SUPPLIES (1.1%)
Bergen Brunswig Corporation 19,600 683,550
Visx, Inc.* 28,800 2,518,200
---------------------
3,201,750
METALS (0.6%)
Precision Castparts Corporation 30,500 1,349,625
Texas Industries, Inc. 16,200 436,388
---------------------
1,786,013
OFFICE EQUIPMENT & SUPPLIES (2.3%)
Lexmark International Group, Inc. Class A* 62,800 6,311,400
---------------------
6,311,400
OIL & GAS (2.3%)
Houston Exploration Company* 64,500 1,281,938
MCN Energy Group, Inc. 7,700 146,781
National Fuel Gas 2,900 131,044
Pool Energy Services* 13,400 144,888
Seacor Smit, Inc.* 16,900 835,520
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 34
<PAGE>
ACCESSOR FUNDS, INC.
SMALL TO MID CAP PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
OIL & GAS (CONTINUED)
Tesoro Petroleum Corporation* 42,400 $ 514,100
Tidewater, Inc. 114,500 2,655,295
Vastar Resources Inc. 15,800 682,361
---------------------
6,391,927
OTHER DURABLE GOODS (2.4%)
Avondale Industries, Inc.* 30,000 870,040
Vulcan Materials Company 43,800 5,762,506
---------------------
6,632,546
PRINTING & PUBLISHING (0.4%)
Mail - Well, Inc.* 89,600 1,024,800
---------------------
1,024,800
RAILROADS (0.2%)
Kansas City Southern 13,500 664,031
---------------------
664,031
RETAIL - GROCERY (0.0%)
Whole Foods Market, Inc. 1,300 62,888
---------------------
62,888
RETAIL - TRADE (2.8%)
Best Buy Company* 65,900 4,044,613
Department 56, Inc.* 29,600 1,111,850
Hillenbrand Industries, Inc. 20,600 1,171,625
Linens `n Things, Inc.* 10,000 396,250
Herman Miller, Inc. 12,700 341,312
Russ Berrie & Company, Inc. 33,200 780,200
---------------------
7,845,850
RESTAURANTS (1.5%)
Brinker International, Inc.* 110,700 3,196,463
Foodmaker, Inc. (New)* 48,800 1,076,874
---------------------
4,273,337
TECHNOLOGY (0.4%)
CMGI, Inc. 5,800 617,874
Hutchinson Technology 5,400 192,375
Network Solutions, Inc. Class A 2,100 274,899
Novellus Systems, Inc. 2,500 123,750
---------------------
1,208,898
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 35
<PAGE>
ACCESSOR FUNDS, INC.
SMALL TO MID CAP PORTFOLIO
SCHEDULE OF INVESTMENTS - concluded
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
TELECOMMUNICATIONS (3.0%)
Century Telephone Enterprises 92,050 $ 6,213,368
Cincinnati Bell 7,000 264,688
Superior Telecom, Inc. 42,150 1,991,588
---------------------
8,469,644
TEXTILES (1.8%)
Mohawk Industries, Inc. 66,100 2,780,331
Shaw Industries, Inc. 93,600 2,269,800
---------------------
5,050,131
TOBACCO (0.6%)
Universal Corporation 50,200 1,763,275
---------------------
1,763,275
TRANSPORATION (1.6%)
Avis Rent A Car, Inc. 139,900 3,383,906
USFreightways Corporation 23,700 690,263
Varlen Corporation 14,978 345,419
---------------------
4,419,588
UTILITIES (3.6%)
American Water Works, Inc. 23,500 793,125
Conectiv, Inc. 10,425 255,412
El Paso Energy 34,200 1,190,588
IPALCO Enterprises, Inc. 66,000 3,658,875
KeySpan Energy Company 38,400 1,190,400
Minnesota Power, Inc. 30,400 1,337,600
Montana Power Company 10,700 605,219
Pinnacle West Capital 14,000 593,250
Western Resources 11,800 392,350
---------------------
10,016,819
WASTE MANAGEMENT (0.2%)
Allied Waste Industries 22,100 522,112
Waste Management, Inc. 1,100 51,288
---------------------
573,400
TOTAL INVESTMENTS (98.8%) (IDENTIFIED COST $235,451,977)
OTHER ASSETS LESS LIABILITIES (1.2%) 276,781,314
NET ASSETS (100.0%) 3,377,877
---------------------
$ 280,159,191
---------------------
---------------------
</TABLE>
* Non-income producing security.
(1) See Note 6 for important tax information.
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 36
<PAGE>
ACCESSOR FUNDS, INC.
INTERNATIONAL EQUITY PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK (99.8%)
ARGENTINA (0.9%)
Banco De Galicia Y Bueno ADR 49,595 $ 874,111
Telefonica De Argentina 23,400 653,738
---------------------
1,527,849
BELGIUM (2.2%)
Barco Industries NV 6,200 1,750,939
Mobistar Sa 38,400 1,939,389
---------------------
3,690,328
BERMUDA (0.7%)
Global Crossing Limited 27,000 1,218,375
---------------------
1,218,375
BRAZIL (1.1%)
Tele Norte Leste Part S ADR 59,200 736,300
Telesp Participacoes Preferred 53,300,000 1,213,170
---------------------
1,949,470
DENMARK (2.0%)
Tele Danmark A/S `B' 25,000 3,374,185
---------------------
3,374,185
FINLAND (4.0%)
Nokia Corporation 44,600 5,371,513
Raision Tehtaat Oy V Shares 120,500 1,332,914
---------------------
6,704,427
FRANCE (11.6%)
Banque Paribas A (New) 19,000 1,652,125
Cap Gemini 14,000 2,248,943
Casino Guichard Perrachon 20,200 2,105,155
Castorama Dubois 8,000 1,826,209
Dessault Systemes 57,500 2,704,175
Sanofi 9,900 1,631,012
Stmicroelectronics NV ADR 20,600 1,608,088
Suez Lyonnaise Des Eaux 8,100 1,664,514
Television Francaise 13,600 2,422,640
Valeo 20,400 1,608,572
---------------------
19,471,433
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 37
<PAGE>
ACCESSOR FUNDS, INC.
INTERNATIONAL EQUITY PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
GERMANY (5.6%)
Bayer Hypo Unvereinsbankstamm 19,700 $ 1,558,928
Bayer Motoren Werke (New*) 1 767
Daimlerchrysler 27,135 2,696,294
Mannesmann AG 25,000 2,893,084
Volkswagen AG 28,700 2,322,691
---------------------
9,471,764
GREAT BRITAIN (17.4%)
Abbey National 112,600 2,411,116
Arm Holding 86,300 1,866,617
British Aerospace PLC 324,600 2,757,055
British Energy PLC 138,600 1,585,393
British Tel-Com PLC 108,000 1,627,097
Cable And Wireless Communications 202,000 1,845,121
Capita Group PLC 173,500 1,599,228
Colt Telecom Group PLC 158,000 2,356,723
Dixons Group 146,200 2,046,933
Gallaher Group (Common) 154,300 1,046,152
Kingfisher PLC 108,874 1,178,345
Lloyds TSB Group 124,701 1,769,783
National Grid (Group PLC) 112,900 901,177
Shire Pharmaceuticals ADR 69,900 1,415,475
Smithkline Beecham PLC 122,500 1,712,050
Somerfield PLC 136,400 912,308
Vodafone Group PLC 142,021 2,306,235
---------------------
29,336,808
GREECE (1.0%)
National Bank Of Greece 7,760 1,745,688
---------------------
1,745,688
HONG KONG (2.8%)
China Resources 652,000 1,018,316
Citic Pacific 415,000 894,570
HSBC Holdings 62,000 1,544,538
Sun Hung Kai (Properties) 173,000 1,261,665
---------------------
4,719,089
HUNGARY (0.6%)
Magyar Tavkozlesi 35,500 1,058,344
---------------------
1,058,344
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 38
<PAGE>
ACCESSOR FUNDS, INC.
INTERNATIONAL EQUITY PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
IRELAND (1.7%)
Elan PLC ADR 16,200 $ 1,126,913
Global Telesystems Group, Inc. 30,500 1,700,375
---------------------
2,827,288
ISRAEL (0.8%)
Gilat Satellite Networks 24,700 1,361,588
---------------------
1,361,588
ITALY (3.8%)
Cellular Communications International, Inc. 42,000 2,856,000
Telecom Italia Mobile SPA 251,600 1,861,533
Unicredito Italiano SPA 279,200 1,658,512
---------------------
6,376,045
JAPAN (21.6%)
Advantest 18,000 1,142,553
Banyu Pharmaceutical 87,000 1,619,681
Bridgestone 49,000 1,114,229
Fuji Soft ABC, Inc. 43,000 2,191,933
Fujitsu Limited 118,000 1,574,379
Hoya Corporation 30,000 1,462,766
Kao Corporation 104,000 2,351,064
Mabuchi Motor 16,500 1,265,293
Minebea Company 129,000 1,479,840
Mitsui Fudosan 202,000 1,531,117
National House Industries 123,000 1,047,899
Nippon Telephone & Telegraph 40 309,220
NTT Mobile Communications 45 1,855,053
Olympus Optical Company 110,000 1,266,755
Orix Corporation 16,700 1,249,539
Ryohin Keikaku Company Limited 14,300 1,907,934
Shohkoh Fund & Company Limited 4,900 1,581,206
Softbank Corporation 29,500 1,778,369
Sony Chemicals 55,400 2,455,674
Sony Corporation 24,400 1,780,248
Sumitomo Mar & Fire 133,000 844,220
Sumitomo Trust & Banking 351,000 933,511
Taiyo Yuden 68,000 806,596
TDK Corporation 14,000 1,282,092
Terumo Corporation 64,400 1,518,652
---------------------
36,349,823
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 39
<PAGE>
ACCESSOR FUNDS, INC.
INTERNATIONAL EQUITY PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
MEXICO (0.8%)
Fomento Economic Mexicano ADR 48,000 $ 1,278,000
---------------------
1,278,000
NETHERLANDS (4.8%)
Ahold (Kon) NV 45,100 1,667,683
Asm Lithography Holding 45,100 1,375,550
OCE Van Der NV 252 9,064
Ver Ned Uitgeversbedr 53,700 2,026,046
Wolters Kluwer CVA 13,900 2,976,030
---------------------
8,054,373
PORTUGAL (1.0%)
Brisa Auto Estradas D PT 29,500 1,736,537
---------------------
1,736,537
SINGAPORE (3.3%)
DBS Land 922,000 1,357,855
Natsteel Electronics Limited 619,000 1,575,636
Overseas-Chinese Bk 237,000 1,608,727
Singapore Technology Engineering 1,052,550 982,380
---------------------
5,524,598
SOUTH AFRICA (0.6%)
Dimension Data Holdings Company 225,273 957,337
---------------------
957,337
SPAIN (5.2%)
Argentaria Corporation 67,400 1,748,316
Centros Comer Continente 29,400 998,067
Grupo Acciona SA 27,000 2,208,255
Tabacalera Series `A' 82,200 2,077,201
Telefonica SA ADR 12,750 1,726,031
---------------------
8,757,870
SWEDEN (0.8%)
Europolitan Holdings AB 13,000 1,275,013
---------------------
1,275,013
SWITZERLAND (5.0%)
Baer Holdings AG 540 1,794,758
Novartis (Reg) 1,120 2,201,675
Swisscom AG 6,700 2,804,878
UBS AG 5,300 1,628,395
---------------------
8,429,706
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 40
<PAGE>
ACCESSOR FUNDS, INC.
INTERNATIONAL EQUITY PORTFOLIO
SCHEDULE OF INVESTMENTS - concluded
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
DESCRIPTION SHARES VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
TAIWAN (0.5%)
Taiwan Semiconductor 55,000 $ 780,313
---------------------
780,313
TOTAL COMMON STOCK (IDENTIFIED COST $134,056,925) 167,976,251
---------------------
</TABLE>
SHORT-TERM INVESTMENTS (2.1%)
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
INTEREST MATURITY PRINCIPAL
DESCRIPTION RATE DATE AMOUNT VALUE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
COMMERCIAL PAPER
Northern States Power Commercial Paper(1) 5.05% 01/04/99 $ 3,581,000 3,581,000
---------------------
TOTAL SHORT-TERM INVESTMENTS 3,581,000
(IDENTIFIED COST $3,581,000) ---------------------
TOTAL INVESTMENTS (101.9%) (IDENTIFIED COST $137,637,925)(2) 171,557,251
OTHER ASSETS LESS LIABILITIES (-1.9%) (3,203,333)
---------------------
NET ASSETS (100.0%) $ 168,353,918
---------------------
---------------------
FORWARD CURRENCY CONTRACTS
</TABLE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
UNREALIZED
EXCHANGE CONTRACT APPRECIATION/ DELIVERY
CURRENCY RATE(3) VALUE (DEPRECIATION) DATE
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
LIABILITIES
Great British Pounds (Buy) 0.5933 $ 18,907 $ (242) 1/4/99
Great British Pounds (Buy) 0.5933 431,509 (5,288) 1/4/99
Great British Pounds (Buy) 0.5941 63,198 (721) 1/5/99
Great British Pounds (Buy) 0.5941 188,665 (2,187) 1/6/99
Japanese Yen (Buy) 114.0900 1,255,649 14,360 1/4/99
-----------
$ 5,922
-----------
-----------
</TABLE>
*Non-income producing security.
(1) Yield at time of purchase.
(2) See Note 6 for important tax information.
(3) Contract Rate.
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 41
<PAGE>
ACCESSOR FUNDS, INC.
INTERMEDIATE FIXED-INCOME PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
INTEREST MATURITY PRINCIPAL
DESCRIPTION RATE DATE AMOUNT VALUE
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
COLLATERALIZED MORTGAGE OBLIGATIONS (0.9%)
Collateralized Mortgage Securities Corporation 9.450% 02/01/17 $ 385,170 $ 411,400
Merrill Lynch Mortgage Investments, Inc., Series 1992-D 8.150% 07/15/17 100,000 102,902
------------
TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS 514,302
(IDENTIFIED COST $598,873) ------------
ASSET-BACKED SECURITIES (9.9%)
Bridgestone/Firestone Master Trust, Series 1996-1 6.170% 07/01/03 1,000,000 1,012,410
Captiva CBO 6.860% 11/30/09 1,200,000 1,256,784
Carco Automotive 6.689% 08/15/04 1,000,000 1,004,280
CPS 1997-4 A1 6.070% 03/15/03 424,794 426,557
Ford Credit Auto Loan Master Trust, Series 1995-1 6.500% 08/15/02 500,000 509,220
ONYX 1996-2 A 6.400% 10/15/01 473,330 477,264
World Financial Network Credit Card Master Trust, Ser 1996-A 6.700% 02/15/04 1,000,000 1,030,644
------------
TOTAL ASSET-BACKED SECURITIES (IDENTIFIED COST $5,586,897) 5,717,159
------------
CORPORATE BONDS (60.2%)
BANKS AND SAVINGS & LOANS (7.8%)
ABN Amro Bank 7.300% 12/01/26 250,000 253,443
Bank One 7.625% 10/15/26 500,000 573,180
Bank America 7.125% 03/01/09 500,000 547,273
Citicorp 7.000% 01/02/04 500,000 520,829
Midland Bank PLC 0.000% 09/29/49 200,000 152,980
JP Morgan & Company, Inc. 7.625% 09/15/04 500,000 546,003
Nations Bank Corporation 8.570% 11/15/24 1,000,000 1,235,391
Standard Fed Bancorporation 7.750% 07/17/06 600,000 662,081
------------
4,491,180
INDUSTRIALS (17.7%)
Anheuser Busch Companies 6.750% 06/01/05 500,000 516,250
Archer Daniels Midland Company 6.250% 05/15/03 1,000,000 1,033,017
Coca Cola Enterprises 6.950% 11/15/26 500,000 531,862
EI Dupont de Nemours & Company 8.800% 01/25/01 500,000 534,507
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 42
<PAGE>
ACCESSOR FUNDS, INC.
INTERMEDIATE FIXED-INCOME PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
INTEREST MATURITY PRINCIPAL
DESCRIPTION RATE DATE AMOUNT VALUE
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INDUSTRIALS (CONTINUED)
Eli Lilly & Company 7.125% 06/01/25 $ 592,000 $ 671,734
Fortune Brands 6.250% 04/01/08 455,000 475,865
General Motors Corporation 8.100% 06/15/24 1,000,000 1,108,459
IBM Corporation 8.375% 11/01/19 1,000,000 1,263,230
John Deere & Company 8.950% 06/15/19 500,000 628,331
Kaiser Foundation Hospitals 8.750% 08/11/03 1,200,000 1,351,681
McDonalds Corporation 6.625% 09/01/02 500,000 518,444
McDonnell Douglas Corporation 6.875% 11/01/06 500,000 535,153
Sony Corporation 6.125% 03/04/03 500,000 512,791
Weyerhauser Company 7.125% 07/15/23 500,000 519,652
------------
10,200,976
NON-BANK FINANCIALS (21.3%)
American Express Corporation 8.625% 05/15/22 500,000 542,428
Aetna 7.125% 08/15/06 1,000,000 1,050,272
Bear Stearns 6.125% 02/01/03 500,000 501,597
Bear Stearns 6.500% 07/05/00 500,000 506,341
Chrysler Financial LLC 5.875% 02/07/01 315,000 318,371
Ford Motor Credit Corporation 6.125% 01/09/06 1,000,000 1,019,960
General Electric Capital Corporation 7.260% 04/29/02 500,000 527,781
General Motors Acceptance Corporation 6.625% 10/15/05 1,000,000 1,054,632
Household Financial Company 6.375% 08/01/10 1,000,000 1,026,398
Jefferson Pilot 8.140% 01/15/46 1,000,000 1,082,622
MBIA, Inc. 8.200% 10/01/22 500,000 543,172
MIC Financing Trust 8.375% 02/01/27 1,000,000 1,041,494
Merrill Lynch 6.000% 02/12/03 500,000 504,640
Morgan Stanley Group, Inc. 7.000% 10/01/13 738,000 779,855
Nynex Capital Funding 8.750% 12/01/04 1,000,000 1,151,172
Sears Roebuck Acceptance Corporation 6.000% 03/20/03 600,000 606,010
------------
12,256,745
PUBLIC UTILITIES (13.4%)
Bellsouth Telecommunications 7.875% 08/01/32 500,000 552,266
Carolina Telephone & Telecommunications 6.750% 08/15/13 375,000 401,349
Central Power & Light 6.625% 07/01/05 1,000,000 1,055,254
Chesapeake & Potomac Telephone Company VA 7.625% 12/01/12 865,000 1,017,527
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 43
<PAGE>
ACCESSOR FUNDS, INC.
INTERMEDIATE FIXED-INCOME PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
INTEREST MATURITY PRINCIPAL
DESCRIPTION RATE DATE AMOUNT VALUE
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PUBLIC UTILITIES (CONTINUED)
Entergy Corporation 6.450% 04/01/08 $ 1,000,000 $ 1,032,044
GTE North, Inc. 6.375% 02/15/10 500,000 532,847
Idaho Power 8.750% 03/15/27 400,000 446,430
Pacificorp 8.250% 11/01/22 500,000 551,188
National Rural Utilities 6.750% 09/01/01 1,000,000 1,035,557
Wisconsin Electric Power 7.250% 08/01/04 1,000,000 1,088,390
------------
7,712,852
TOTAL CORPORATE BONDS (IDENTIFIED COST $33,721,854) 34,661,753
------------
U.S. GOVERNMENT AND AGENCY SECURITIES (26.7%)
U.S. TREASURY BONDS (3.3%)
United States Treasury Bond 8.750% 08/15/20 500,000 712,657
United States Treasury Bond 6.125% 11/15/27 1,050,000 1,176,000
------------
1,888,657
U.S. TREASURY NOTES (5.4%)
United States Treasury Note 6.250% 02/15/03 200,000 211,375
United States Treasury Note 5.625% 02/15/06 1,000,000 1,054,688
United States Treasury Note 6.125% 08/15/07 250,000 273,203
United States Treasury Note 5.500% 02/15/08 500,000 530,000
United States Treasury Note 5.625% 05/15/08 1,000,000 1,066,875
------------
3,136,141
FEDERAL FARM CREDIT CORPORATION (FFCB) (0.2%)
FFCB 6.190% 01/14/08 100,000 102,111
------------
102,111
FEDERAL HOME LOAN BANK (FHLB) (5.1%)
FHLB 5.750% 03/03/08 245,000 251,825
FHLB 5.125% 09/15/03 500,000 498,902
FHLB 6.010% 04/22/08 100,000 104,661
FHLB 6.185% 05/06/08 1,000,000 1,059,445
FHLB 6.095% 03/16/05 1,000,000 1,011,288
------------
2,926,121
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 44
<PAGE>
ACCESSOR FUNDS, INC.
INTERMEDIATE FIXED-INCOME PORTFOLIO
SCHEDULE OF INVESTMENTS - concluded
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
INTEREST MATURITY PRINCIPAL
DESCRIPTION RATE DATE AMOUNT VALUE
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC) (5.5%)
FHLMC 5.900% 02/15/06 $ 100,000 $ 103,892
FHLMC 6.980% 01/22/07 75,000 80,340
FHLMC 5.750% 07/15/03 1,000,000 1,027,800
FHLMC 5.865% 07/16/01 1,000,000 1,003,216
FHLMC 5.125% 10/15/08 1,000,000 980,676
------------
3,195,924
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) (7.2%)
FNMA 6.000% 05/15/08 2,000,000 2,110,344
FNMA 6.770% 09/01/05 480,000 521,852
FNMA 6.690% 02/02/11 500,000 512,101
FNMA 6.350% 05/18/05 500,000 511,514
FNMA 6.460% 06/26/08 500,000 509,974
------------
4,165,785
TOTAL U.S. GOVERNMENT AND AGENCY SECURITIES 15,414,739
(IDENTIFIED COST $15,341,672) ------------
SHORT-TERM INVESTMENTS (0.0%)
Fifth Third Bank Repurchase Agreement dated 12/31/98 4.220% 01/04/99 21,525 21,525
(collateralized by 22,000 US Treasury Note, 7.50%, ------------
10/31/99, market value $22,491)
TOTAL SHORT-TERM INVESTMENTS 21,525
(IDENTIFIED COST $21,525) ------------
TOTAL INVESTMENTS (97.7%) (IDENTIFIED COST $55,270,821)(1) 56,329,478
OTHER ASSETS LESS LIABIALTIES (2.3%) 1,305,799
------------
NET ASSETS (100%) $ 57,635,277
------------
------------
</TABLE>
(1) See Note 6 for important tax information.
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 45
<PAGE>
ACCESSOR FUNDS, INC.
SHORT-INTERMEDIATE FIXED-INCOME PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
INTEREST MATURITY PRINCIPAL
DESCRIPTION RATE DATE AMOUNT VALUE
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
CORPORATE BONDS (46.9%)
BANKS AND SAVINGS & LOANS (5.8%)
BAC Security Pacific 10.300% 05/15/01 $ 125,000 $ 137,137
Bank of Boston 6.380% 08/11/00 245,000 246,745
Chase Manhattan Corporation 8.625% 05/01/02 400,000 435,303
First Bank NA 6.250% 08/15/05 500,000 502,154
First USA Bank 6.625% 12/03/01 1,115,000 1,147,290
Texas National Bank 9.500% 06/01/04 285,000 335,178
-----------------
2,803,807
INDUSTRIALS (18.5%)
Amoco 7.250% 12/01/02 500,000 531,060
Anheuser Busch Companies 8.750% 12/01/99 270,000 278,227
Anheuser Busch Companies 6.750% 06/01/05 500,000 516,250
Baxter International Incorporated 9.250% 12/15/99 200,000 207,139
EI Dupont de Nemours & Company 8.800% 01/25/01 1,000,000 1,069,013
Englehard Corporation 6.500% 09/01/00 445,000 451,858
General Motors Corporation 9.125% 07/15/01 1,085,000 1,177,646
JC Penney Company 7.375% 06/15/04 500,000 524,663
John Deere & Company 5.350% 10/23/01 500,000 494,847
McDonalds Corporation 6.625% 09/01/02 500,000 518,444
Norstrom CR Incorporated 6.700% 07/01/05 500,000 527,705
Sears Roebuck Acceptance Corporation 6.400% 10/11/00 350,000 355,032
Sears Roebuck Acceptance Corporation 6.630% 07/09/02 542,000 556,965
Sears Roebuck Acceptance Corporation 6.360% 12/04/01 525,000 534,191
Shell Oil Company 6.625% 07/01/99 250,000 251,845
Sony Corporation 6.125% 03/04/03 1,000,000 1,025,582
-----------------
9,020,467
NON-BANK FINANCIAL (15.7%)
AM General Finance 6.200% 03/15/03 460,000 468,162
AIG International Lease Finacial 5.780% 03/01/01 350,000 350,456
Associates Corporation 6.750% 08/01/01 1,130,000 1,165,218
Bear Stearns 6.750% 04/15/03 500,000 513,276
Bear Stearns 6.500% 07/05/00 500,000 506,341
Chrysler Financial Corporation 6.110% 07/28/99 310,000 311,336
Dean Witter Discover & Company 6.875% 03/01/03 400,000 415,744
Ford Motor Credit Corporation 6.250% 11/08/00 650,000 659,660
General Motors Acceptance Corporation 6.700% 04/30/01 395,000 405,720
General Motors Acceptance Corporation 5.375% 09/30/02 500,000 497,036
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 46
<PAGE>
ACCESSOR FUNDS, INC.
SHORT-INTERMEDIATE FIXED-INCOME PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
INTEREST MATURITY PRINCIPAL
DESCRIPTION RATE DATE AMOUNT VALUE
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
NON-BANK FINANCIALS (CONTINUED)
Grand Metro Investment 6.500% 09/15/99 $ 500,000 $ 503,611
IBM Credit Corporation 5.875% 08/25/99 300,000 300,733
International Lease Finance 6.875% 05/01/01 535,000 549,802
Merrill Lynch 6.000% 03/01/01 500,000 503,776
Merrill Lynch 6.000% 02/12/03 500,000 504,640
-----------------
7,655,511
PUBLIC UTILITIES (5.7%)
Baltimore Gas & Electric Company 8.375% 08/15/01 300,000 321,342
Iowa Electric 8.625% 05/15/01 395,000 423,457
Metropolitian 7.220% 01/30/03 500,000 527,601
Pacificorp 6.310% 07/28/03 550,000 565,487
Penn Power & Light 6.000% 06/01/00 750,000 757,220
Southern California Education 5.875% 01/15/01 90,000 90,813
US West Telecommunications 8.875% 06/01/31 100,000 112,264
-----------------
2,798,184
TRANSPORTATION (1.2%)
Southwest Airlines 8.750% 10/15/03 500,000 568,331
-----------------
568,331
TOTAL CORPORATE BONDS (IDENTIFIED COST $22,688,715) 22,846,300
-----------------
FOREIGN GOVERNMENT ISSUES (0.7%)
YANKEE (0.7%)
Province of Manitoba 9.500% 10/01/00 300,000 320,973
-----------------
TOTAL FOREIGN GOVERNMENT ISSUES (IDENTIFIED COST $316,275) 320,973
-----------------
U.S. GOVERNMENT AND AGENCY SECURITIES (50.6%)
U.S. TREASURY BONDS (2.1%)
United States Treasury Bond 6.875% 07/31/99 200,000 202,500
United States Treasury Bond 6.250% 10/31/01 800,000 833,250
-----------------
1,035,750
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 47
<PAGE>
ACCESSOR FUNDS, INC.
SHORT-INTERMEDIATE FIXED-INCOME PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
INTEREST MATURITY PRINCIPAL
DESCRIPTION RATE DATE AMOUNT VALUE
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
U.S. TREASURY NOTES (18.1%)
United States Treasury Note 6.000% 10/15/99 $ 565,000 $ 570,827
United States Treasury Note 7.125% 09/30/99 650,000 661,578
United States Treasury Note 8.000% 08/15/99 1,820,000 1,856,967
United States Treasury Note 5.625% 02/28/01 500,000 510,157
United States Treasury Note 6.375% 03/31/01 35,000 36,280
United States Treasury Note 6.500% 08/31/01 500,000 522,657
United States Treasury Note 5.875% 11/15/99 565,000 570,827
United States Treasury Note 6.250% 01/31/02 1,400,000 1,461,688
United States Treasury Note 6.250% 02/28/02 1,300,000 1,358,500
United States Treasury Note 6.625% 03/31/02 40,000 42,275
United States Treasury Note 6.500% 05/31/02 430,000 454,053
United States Treasury Note 5.625% 12/31/02 250,000 258,203
United States Treasury Note 5.500% 03/31/03 500,000 515,000
-----------------
8,819,012
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC) (8.4%)
FHLMC 6.150% 03/06/03 1,250,000 1,260,819
FHLMC 5.750% 07/15/03 1,750,000 1,798,650
FHLMC Pool E30447 8.500% 02/01/06 6,366 6,590
FHLMC Pool E39980 8.500% 08/01/06 5,068 5,247
FHLMC 7.214% 03/19/07 500,000 526,873
FHLMC 6.540% 11/06/07 250,000 258,025
FHLMC Pool E43681 7.500% 01/01/08 201,045 206,921
-----------------
4,063,125
Federal National Mortgage Association (FNMA) (15.3%)
FNMA 8.500% 02/01/05 200,000 207,232
FNMA 7.900% 09/20/06 150,000 152,984
FNMA 7.000% 12/01/08 170,835 174,638
FNMA 6.850% 09/25/07 1,000,000 1,030,859
FNMA 6.860% 10/16/07 2,140,000 2,206,826
FNMA 6.350% 05/15/05 500,000 511,514
FNMA 6.430% 05/23/05 500,000 507,622
FNMA 6.500% 07/07/08 585,000 595,195
FNMA 5.800% 08/13/01 2,000,000 2,013,396
FNMA Pool 185550 7.000% 11/01/07 68,457 69,977
-----------------
7,470,243
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 48
<PAGE>
ACCESSOR FUNDS, INC.
SHORT-INTERMEDIATE FIXED-INCOME PORTFOLIO
SCHEDULE OF INVESTMENTS - concluded
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
INTEREST MATURITY PRINCIPAL
DESCRIPTION RATE DATE AMOUNT VALUE
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
FEDERAL HOME LOAN BANK (FHLB) (6.7%)
FHLB 6.095% 03/16/05 $ 2,000,000 $ 2,022,576
FHLB 6.400% 05/26/05 125,000 126,428
FHLB 6.250% 04/06/05 50,000 50,799
FHLB 6.000% 03/27/02 1,000,000 1,009,026
FHLB 7.330% 04/02/07 50,000 53,400
-----------------
3,262,229
TOTAL U.S. GOVERNMENT AND AGENCY SECURITIES 24,650,359
(IDENTIFIED COST $24,335,215) -----------------
SHORT-TERM INVESTMENTS (0.1%)
Fifth Third Bank Repurchase Agreement dated 12/31/98 4.220% 01/04/99 50,251 50,251
(collateralized by 51,000 US Treasury Note, 7.50%, ------------------
10/31/99, market value $52,139)
TOTAL SHORT-TERM INVESTMENTS 50,251
(IDENTIFIED COST $50,251) ------------------
TOTAL INVESTMENTS (98.3%) (IDENTIFIED COST $47,390,456)(1) 47,867,883
OTHER ASSETS LESS LIABILITIES (1.7%) 840,980
-----------------
NET ASSETS (100.0%) $ 48,708,863
-----------------
-----------------
</TABLE>
(1) See Note 6 for important tax information.
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 49
<PAGE>
ACCESSOR FUNDS, INC.
MORTGAGE SECURITIES PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
INTEREST MATURITY PRINCIPAL
DESCRIPTION RATE DATE AMOUNT VALUE
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
CORPORATE BONDS (18.0%)
ASSET-BACKED (7.2%)
AFC Home Equity Loan 1998-2 5.774% 07/25/08 $ 1,738,334 $ 1,714,432
Chevy Chase Auto Receivables Trust - 1996-2 5.900% 07/15/03 343,531 344,847
First Plus Home Loan Trust 1998-4 6.240% 05/11/15 1,000,000 1,007,500
Green Tree Home Improvement Loan Trust-GTHIL 1998-B 5.755% 11/15/29 1,082,273 1,067,002
Green Tree Financial Corporation - 1994-D(1) 9.050% 01/15/15 1,000,000 1,035,968
Green Tree Financial Corporation - 1998-E 6.660% 08/15/17 1,600,000 1,593,500
Green Tree Financial Corporation 1997-I 7.290% 03/15/28 800,000 852,485
Merrill Lynch FHA 42 7.430% 09/01/22 1,229,802 1,270,765
Mortgage Capital Funding 6.000% 11/18/31 1,600,000 1,607,000
--------------
10,493,499
PROJECT LOANS (10.8%)
Arbors of Little Rock 7.450% 11/01/38 1,520,368 1,629,768
Chapel Hill Assisted Living 7.750% 06/01/37 515,000 516,553
CLC Excelsior II Apartments 7.875% 02/01/39 1,000,000 1,010,491
Country Club Village 7.660% 09/01/38 1,675,000 1,819,741
Desert Mirage Apartments 7.250% 11/25/37 1,500,000 1,509,617
Enclave at Quail Crossing 7.750% 08/31/38 1,000,000 1,003,014
Enclave at Stonebrook 7.500% 11/01/38 1,028,984 1,107,848
Evergreen Towers 7.375% 01/01/39 1,004,700 1,069,686
Hillsboro Bay Club 7.950% 03/01/37 75,812 83,642
Orchard Park Inn 7.840% 03/01/28 1,019,310 1,114,053
Poplar Towers Apartments 7.750% 06/01/37 404,664 405,884
Prairie District Lofts 7.405% 05/01/39 945,000 1,007,298
River Bluff Apartments 7.750% 06/01/37 68,044 74,552
Rosewood 8.000% 07/01/37 1,001,967 1,106,277
Sunshine Gardens West 7.470% 11/01/38 53,929 57,572
Triangle Point 7.750% 09/01/39 983,331 1,073,706
Villages at Clear Springs 7.625% 09/30/38 1,095,600 1,189,511
--------------
15,779,213
TOTAL CORPORATE BONDS (IDENTIFIED COST $25,416,427) 26,272,712
--------------
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 50
<PAGE>
ACCESSOR FUNDS, INC.
MORTGAGE SECURITIES PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
INTEREST MATURITY PRINCIPAL
DESCRIPTION RATE DATE AMOUNT VALUE
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
COLLATERALIZED MORTGAGE OBLIGATIONS (17.0%)
CS First Boston Mortgage Securities Corporation 1998-C2 5.960% 12/15/07 $ 900,000 $ 910,071
DLJ Mortgage Acceptance 1998-2 CL A1 6.750% 06/19/28 1,570,076 1,582,455
GMAC Commercial Mortgage Securities Incorporated 0.000% 08/15/23 16,620,000 715,983
GS Mortgage Securities Corporation 1998-1 CL A (2) 8.000% 09/20/27 1,661,243 1,734,961
GS Mortgage Securities Corporation 1998-2 CL A (2) 7.750% 05/19/27 1,482,410 1,537,537
Merit Securities Corporation 11 CL 1-A1 6.580% 07/28/22 474,351 474,275
Morgan Stanley Capital I-1998-CF1-A1 6.330% 10/15/07 1,152,076 1,181,316
Morgan Stanley Capital I-1998-CF1-A1 (2) 0.000% 12/15/12 12,813,000 675,491
Norwest Intgrated Structured Assets Incorporated 1998-1 A1 7.000% 05/25/28 1,898,571 1,908,862
Residential Asset Securitization Trust 1998-A8 6.750% 08/25/28 1,391,347 1,398,276
Residential Asset Securitization Trust 1998-A5 6.750% 07/25/28 1,872,602 1,881,122
Residential Asset Securitization Trust 1998-A8 6.750% 03/01/28 1,558,826 1,567,509
Residential Asset Securitization Trust 1998-A12 6.750% 11/25/28 1,540,610 1,550,377
Residential Accredit Loans Incorporated 1997-QS10 7.250% 10/25/27 1,171,827 1,180,170
Residential Accredit Loans Incorporated 1997-QS12 7.250% 11/25/27 1,188,797 1,214,574
Residential Accredit Loans Incorporated 1998-QS4 6.500% 03/25/28 1,001,759 1,001,869
Residential Accredit Loans Incorporated 1998-QA5 6.750% 04/25/28 1,496,909 1,503,135
Rural Housing Trust 1987-1 - Rural 2C 6.830% 04/01/26 732,582 741,649
Ryland Mortgage Securities Corporation 1994-7A A2 7.000% 08/25/25 1,009,150 1,024,570
Union Planters Mortgage Finance Corporation 1998-1 6.350% 01/25/28 1,106,156 1,119,827
--------------
24,904,029
TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS 24,904,029
(IDENTIFIED COST $24,852,417) --------------
U.S. GOVERNMENT AND AGENCY BONDS (64.9%)
U.S. TREASURY NOTES (1.3%)
United States Treasury Note 5.250% 11/15/28 550,000 563,750
United States Treasury Note (CPI) 3.625% 04/15/28 1,318,473 1,284,687
--------------
1,848,437
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) (21.0%)
GNMA Pool 000571 8.200% 05/15/13 43,508 45,240
GNMA Pool 000572 8.200% 06/15/12 30,291 31,487
GNMA Pool 171468 8.000% 08/15/16 147,515 154,654
GNMA Pool 175724 8.000% 08/15/16 138,309 145,003
GNMA Pool 178457 8.000% 03/15/17 88,864 93,161
GNMA Pool 206767 8.000% 04/15/17 77,086 80,814
GNMA Pool 317527 8.000% 02/15/22 336,900 350,783
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 51
<PAGE>
ACCESSOR FUNDS, INC.
MORTGAGE SECURITIES PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
INTEREST MATURITY PRINCIPAL
DESCRIPTION RATE DATE AMOUNT VALUE
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) (CONTINUED)
GNMA Pool 337121 6.500% 12/15/23 $ 216,694 $ 218,794
GNMA Pool 344185 7.500% 12/15/22 1,060,247 1,093,051
GNMA Pool 346900 6.500% 11/15/23 430,691 434,864
GNMA Pool 352000 6.500% 12/15/23 1,172,331 1,183,691
GNMA Pool 352001 6.500% 12/15/23 393,597 397,754
GNMA Pool 353847 7.500% 09/15/27 779,191 803,299
GNMA Pool 354711 6.500% 12/15/23 441,861 446,143
GNMA Pool 354721 6.500% 12/15/23 238,859 241,174
GNMA Pool 355067 6.500% 01/15/24 845,620 853,815
GNMA Pool 355616 7.500% 05/15/23 832,813 858,614
GNMA Pool 355829 6.500% 11/15/23 231,311 233,552
GNMA Pool 364402 6.500% 12/15/23 255,663 258,140
GNMA Pool 365974 6.500% 11/15/23 218,987 221,107
GNMA Pool 366252 6.500% 03/15/24 73,714 74,428
GNMA Pool 369258 6.500% 10/15/23 235,834 238,119
GNMA Pool 369280 6.500% 01/15/24 709,934 716,813
GNMA Pool 370962 6.500% 12/15/23 239,712 242,035
GNMA Pool 371250 6.500% 01/15/24 44,622 45,055
GNMA Pool 371611 6.500% 01/15/24 77,206 77,954
GNMA Pool 372083 6.500% 04/15/24 785,968 793,584
GNMA Pool 374886 6.500% 12/15/23 201,515 203,467
GNMA Pool 374888 6.500% 01/15/24 50,972 51,465
GNMA Pool 375305 8.000% 09/15/25 51,594 53,564
GNMA Pool 380252 6.500% 03/15/24 153,970 155,462
GNMA Pool 382387 6.500% 01/15/24 53,923 54,445
GNMA Pool 384262 6.500% 02/15/24 464,950 469,455
GNMA Pool 384289 6.500% 02/15/24 212,667 214,728
GNMA Pool 385638 6.500% 04/15/24 45,125 45,562
GNMA Pool 386578 7.000% 12/15/27 876,744 896,951
GNMA Pool 386952 6.500% 04/15/24 412,958 416,959
GNMA Pool 387022 8.000% 05/15/25 13,370 13,880
GNMA Pool 390326 8.000% 02/15/25 41,288 42,865
GNMA Pool 397911 8.000% 09/15/25 161,027 167,177
GNMA Pool 404645 8.000% 07/15/25 14,033 14,568
GNMA Pool 405188 8.000% 11/15/25 10,750 11,160
GNMA Pool 405528 8.000% 11/15/25 479,365 497,673
GNMA Pool 413357 8.000% 05/15/25 24,935 25,887
GNMA Pool 413462 8.000% 08/15/25 18,851 19,571
GNMA Pool 415323 8.000% 07/15/25 565,408 587,001
GNMA Pool 416844 8.000% 08/15/25 40,955 42,520
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 52
<PAGE>
ACCESSOR FUNDS, INC.
MORTGAGE SECURITIES PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
INTEREST MATURITY PRINCIPAL
DESCRIPTION RATE DATE AMOUNT VALUE
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) (CONTINUED)
GNMA Pool 427768 7.500% 11/15/27 $ 107,177 $ 110,493
GNMA Pool 428537 7.500% 08/15/26 99,001 102,016
GNMA Pool 430230 7.500% 09/15/27 840,768 866,782
GNMA Pool 447986 7.000% 06/15/28 5,882,492 6,018,577
GNMA Pool 448687 7.500% 09/15/27 802,252 827,074
GNMA Pool 449183 7.500% 10/15/27 916,586 944,945
GNMA Pool 450585 7.500% 08/15/27 918,718 947,143
GNMA Pool 451843 7.500% 06/15/27 481,957 496,898
GNMA Pool 454301 7.000% 10/15/27 923,717 945,007
GNMA Pool 454969 7.500% 08/15/27 841,152 867,177
GNMA Pool 457249 7.000% 11/15/27 883,539 903,903
GNMA Pool 457485 7.500% 11/15/27 416,524 429,411
GNMA Pool 457817 7.000% 09/15/28 938,054 959,755
GNMA Pool 459094 7.500% 10/15/27 458,030 472,202
GNMA Pool 460603 7.000% 11/15/27 941,792 963,499
GNMA Pool 780487 7.250% 12/15/26 400,027 413,372
GNMA Pool 780651 7.000% 10/15/27 156,160 159,759
--------------
30,745,501
FEDERAL HOUSING AUTHORITY (FHA) (0.1%)
FHA - Blair Project 10.875% 08/01/28 152,582 152,634
--------------
152,634
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC)(26.5%)
FHLMC Pool 1563 8.522% 08/15/08 251,638 256,507
FHLMC Pool 230105 8.750% 12/01/14 12,524 13,213
FHLMC Pool A00892 9.000% 09/01/18 299,755 320,672
FHLMC Pool C00262 7.000% 10/01/23 2,287,935 2,335,919
FHLMC Pool C00516 8.000% 05/01/27 425,034 439,967
FHLMC Pool C00676 6.500% 11/01/28 457,473 460,908
FHLMC Pool C00689 6.500% 12/01/28 1,102,744 1,111,024
FHLMC Pool C16094 6.500% 10/01/28 92,232 92,924
FHLMC Pool C17320 6.500% 11/01/28 599,546 604,048
FHLMC Pool C17819 6.500% 12/01/28 544,032 548,117
FHLMC Pool C18650 6.500% 12/01/28 501,850 505,618
FHLMC Pool C18816 6.500% 12/01/28 252,225 254,119
FHLMC Pool C18841 6.500% 12/01/28 347,785 350,396
FHLMC Pool C18842 6.500% 12/01/28 890,115 896,799
FHLMC Pool C18843 6.500% 12/01/28 561,894 566,113
FHLMC Pool C19158 6.500% 12/01/28 856,260 862,690
FHLMC Pool C19218 6.500% 12/01/28 30,678 30,908
FHLMC Pool C19460 6.500% 12/01/28 3,485,000 3,511,169
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 53
<PAGE>
ACCESSOR FUNDS, INC.
MORTGAGE SECURITIES PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
INTEREST MATURITY PRINCIPAL
DESCRIPTION RATE DATE AMOUNT VALUE
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC)(CONTINUED)
FHLMC Pool C19481 6.500% 12/01/28 $ 1,465,000 $ 1,476,001
FHLMC Pool C19582 6.500% 12/01/28 341,866 344,433
FHLMC Pool C19588 6.500% 12/01/28 267,125 269,131
FHLMC Pool C80409 8.000% 06/01/26 359,723 372,453
FHLMC Pool D54041 7.000% 06/01/24 30,375 31,006
FHLMC Pool D55805 8.000% 08/01/24 208,076 215,629
FHLMC Pool D61603 8.000% 07/01/25 848,855 880,364
FHLMC Pool D71143 7.000% 05/01/26 386,673 394,696
FHLMC Pool E00478 7.500% 03/01/12 407,292 419,000
FHLMC Pool E00523 6.500% 12/15/12 3,286,973 3,340,583
FHLMC Pool E00543 6.000% 04/01/13 5,629,626 5,652,546
FHLMC Pool E20190 6.500% 08/01/10 324,420 329,650
FHLMC Pool E20193 6.500% 09/01/10 325,994 331,249
FHLMC Pool E61583 6.500% 10/01/10 366,613 372,523
FHLMC Pool E61633 6.500% 11/01/10 312,340 317,375
FHLMC Pool E61643 6.500% 10/01/10 328,769 334,069
FHLMC Pool E62414 6.500% 01/01/11 265,508 269,788
FHLMC Pool E62838 6.500% 01/01/11 134,976 137,152
FHLMC Pool E63081 6.500% 02/01/11 340,238 345,722
FHLMC Pool E63833 6.500% 04/01/11 289,110 293,781
FHLMC Pool E63846 6.500% 04/01/11 270,084 274,438
FHLMC Pool E63924 6.500% 04/01/11 271,178 275,550
FHLMC Pool E67224 7.000% 07/01/12 128,520 131,475
FHLMC Pool E67294 7.000% 07/01/12 289,523 296,180
FHLMC Pool E69095 6.500% 02/01/13 267,997 272,368
FHLMC Pool E69799 6.500% 04/01/13 25,459 25,849
FHLMC Pool E70508 6.500% 05/01/13 548,661 557,610
FHLMC Pool E70930 5.500% 06/01/13 44,759 44,219
FHLMC Pool E71047 6.500% 06/01/13 725,556 736,673
FHLMC Pool E73386 5.500% 11/01/13 79,727 78,764
FHLMC Pool E73540 5.500% 12/01/13 821,391 811,468
FHLMC Pool E73667 5.500% 12/01/13 88,882 87,808
FHLMC Pool E73746 5.500% 12/01/13 65,497 64,706
FHLMC Pool E73762 5.500% 06/01/13 879,744 869,116
FHLMC Pool G00246 8.000% 07/01/24 109,202 113,166
FHLMC Pool G00514 8.000% 12/01/25 203,700 211,261
FHLMC Pool G00924 8.000% 03/01/28 4,332,909 4,486,252
FHLMC Pool G00983 6.500% 11/01/28 84,178 84,810
--------------
38,709,975
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 54
<PAGE>
ACCESSOR FUNDS, INC.
MORTGAGE SECURITIES PORTFOLIO
SCHEDULE OF INVESTMENTS - continued
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
INTEREST MATURITY PRINCIPAL
DESCRIPTION RATE DATE AMOUNT VALUE
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA)(16.0%)
FNMA Pool 250641 7.500% 08/01/26 $ 39,539 $ 40,606
FNMA Pool 252257 5.500% 12/01/13 353,397 349,058
FNMA Pool 303751 8.000% 10/01/09 302,378 312,949
FNMA Pool 303752 8.000% 05/01/22 189,803 196,952
FNMA Pool 320761 7.500% 11/01/25 31,966 32,835
FNMA Pool 321059 7.500% 08/01/25 164,253 168,719
FNMA Pool 323057 6.500% 03/01/13 331,577 336,345
FNMA Pool 392410 6.500% 02/01/13 1,381,920 1,401,793
FNMA Pool 402979 7.500% 11/01/27 25,186 25,866
FNMA Pool 409230 6.500% 01/01/28 187,289 188,591
FNMA Pool 414469 7.000% 03/01/28 262,581 267,669
FNMA Pool 417923 6.500% 03/01/13 33,150 33,627
FNMA Pool 418129 6.500% 04/01/28 936,388 942,834
FNMA Pool 419124 6.500% 04/01/13 23,279 23,613
FNMA Pool 419972 6.500% 04/01/28 936,137 942,582
FNMA Pool 420499 6.000% 03/01/28 2,958,865 2,920,664
FNMA Pool 420712 6.500% 05/01/28 307,522 309,639
FNMA Pool 425974 7.500% 05/01/28 431,196 442,830
FNMA Pool 426675 6.500% 05/01/13 24,141 24,488
FNMA Pool 426854 8.000% 11/01/10 1,030,572 1,077,592
FNMA Pool 433673 6.000% 11/01/28 1,001,869 988,934
FNMA Pool 436867 6.500% 08/01/28 559,030 562,878
FNMA Pool 439594 6.500% 08/01/28 387,140 389,805
FNMA Pool 440675 6.000% 10/01/28 3,016,191 2,977,250
FNMA Pool 440857 5.500% 10/01/13 3,005,836 2,968,934
FNMA Pool 445982 5.500% 12/01/13 340,023 335,849
FNMA Pool 445985 5.500% 12/01/13 296,580 292,939
FNMA Pool 446492 5.500% 12/01/13 67,885 67,052
FNMA Pool 449045 5.500% 12/01/13 1,214,813 1,199,899
FNMA Pool 449048 5.500% 12/01/13 1,244,145 1,228,871
FNMA Pool 450464 5.500% 12/01/13 443,157 437,716
FNMA Pool 453123 5.500% 12/01/13 490,000 483,984
FNMA Pool 453271 6.500% 11/01/28 990,018 996,833
FNMA Pool 455502 5.500% 12/01/13 500,000 493,862
--------------
23,464,058
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 55
<PAGE>
ACCESSOR FUNDS, INC.
MORTGAGE SECURITIES PORTFOLIO
SCHEDULE OF INVESTMENTS - concluded
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
INTEREST MATURITY PRINCIPAL
DESCRIPTION RATE DATE AMOUNT VALUE
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
TOTAL U.S. GOVERNMENT AND AGENCY BONDS $ 94,920,605
(IDENTIFIED COST $93,893,950) --------------
SHORT-TERM INVESTMENTS AND CASH EQUIVALENTS (2.6%)
Fifth Third Bank Repurchase Agreement dated 12/31/98 4.220% 01/04/99 3,735,000 3,735,000
collateralized by 3,706,000 FHMLC Pool #G10657, 7.50%, --------------
02/01/12, market value $3,810,231)
TOTAL SHORT-TERM INVESTMENTS AND CASH EQUIVALENTS
(IDENTIFIED COST $3,735,000) 3,735,000
--------------
TOTAL INVESTMENTS (102.5%) (IDENTIFIED COST $147,897,794)(3) 149,832,346
OTHER ASSETS LESS LIABILITIES (-2.5%) (3,675,341)
--------------
NET ASSETS (100.0%) $ 146,157,005
--------------
--------------
</TABLE>
FORWARD COMMITMENTS
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
PRINCIPAL DELIVERY COUPON MARKET
AGENCY AMOUNT DATE RATE VALUE
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
TBA SALE COMMITMENTS AT DECEMBER 31, 1998
(Proceeds receivable $1,512,193)
FNMA $ 1,500,000 1/14/99 6.50% $ 1,512,193
--------------
--------------
</TABLE>
See Note 2 for more information regarding forward committments.
OUTSTANDING FUTURES CONTRACTS
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
UNREALIZED
UNITS PER CURRENT APPRECIATION
TYPE EXPIRATION CONTRACT CONTRACT VALUE (DEPRECIATION)
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
5 Year Note Future 03/19/99 11 1,000 $ (1,246,781) $ 14,964
10 Year Note Future 03/19/99 81 1,000 (9,651,656) 12,853
30 Year Bond Future 03/19/99 21 2,500 (2,683,406) 20,249
-----------
$ 48,066
-----------
-----------
</TABLE>
(1) Security has been segregated with the custodian to cover margin requirements
for the open futures contracts at December 31, 1998.
(2) Security exempt from registration under Rule 144(a) of the Securities Act of
1933. These securities may be resold in transactions exempt from registration,
normally to qualified institutional buyers.
(3) See Note 6 for important tax information.
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 56
<PAGE>
ACCESSOR FUNDS, INC.
U.S. GOVERNMENT MONEY PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------
INTEREST MATURITY PRINCIPAL
DESCRIPTION RATE DATE AMOUNT VALUE
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
U.S. AGENCY BONDS (87.3%)
FEDERAL AGRICULTURAL MORTGAGE CORPORATION (FAMCK) (1.9%)
FAMCK Discount Note 5.070% 01/19/99 $ 2,994,000 $ 2,986,410
----------------
2,986,410
FEDERAL MORTGAGE CORPORATION (FMC) (50.3%)
FMC Discount Note 5.110% 01/08/99 10,000,000 9,990,132
FMC Discount Note 5.060% 01/11/99 5,000,000 4,992,972
FMC Discount Note 5.050% 01/15/99 5,000,000 4,990,181
FMC Discount Note 5.080% 01/20/99 5,000,000 4,986,594
FMC Discount Note 5.025% 01/22/99 5,000,000 4,985,344
FMC Discount Note 5.030% 01/29/99 5,000,000 4,980,439
FMC Discount Note 5.030% 02/10/99 5,000,000 4,972,056
FMC Discount Note 5.060% 02/11/99 5,000,000 4,971,186
FMC Discount Note 5.050% 02/19/99 5,000,000 4,965,632
FMC Discount Note 5.060% 02/25/99 5,000,000 4,961,347
FMC Discount Note 4.940% 02/26/99 5,000,000 4,961,578
FMC Discount Note 4.980% 03/08/99 5,000,000 4,954,350
FMC Discount Note 4.990% 03/12/99 5,000,000 4,951,486
FMC Discount Note 4.880% 03/18/99 5,000,000 4,948,489
FMC Discount Note 4.850% 04/01/99 5,000,000 4,939,375
----------------
79,551,161
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) (20.7%)
FNMA Discount Note 5.005% 01/04/99 5,000,000 4,997,915
FNMA Discount Note 5.355% 01/15/99 3,000,000 2,993,753
FNMA Discount Note 4.870% 02/02/99 5,000,000 4,978,356
FNMA Discount Note 5.070% 02/05/99 5,000,000 4,975,354
FNMA Discount Note 5.210% 02/12/99 5,000,000 4,969,608
FNMA Discount Note 4.870% 03/02/99 3,000,000 2,975,650
FNMA Discount Note 5.230% 03/05/99 2,000,000 1,981,695
FNMA Discount Note 4.895% 03/15/99 5,000,000 4,950,370
----------------
32,822,701
FEDERAL HOME LOAN BANK (FHLB) (14.4%)
FHLB Discount Note 5.355% 01/08/99 3,000,000 2,996,876
FHLB Discount Note 5.350% 01/20/99 2,000,000 1,994,353
FHLB Discount Note 5.350% 01/29/99 3,000,000 2,987,517
FHLB Discount Note 4.930% 03/22/99 5,000,000 4,945,222
FHLB Discount Note 4.920% 03/25/99 5,000,000 4,943,283
FHLB Discount Note 4.920% 03/30/99 5,000,000 4,939,866
----------------
22,807,117
</TABLE>
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 57
<PAGE>
ACCESSOR FUNDS, INC.
U.S. GOVERNMENT MONEY PORTFOLIO
SCHEDULE OF INVESTMENTS - concluded
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------
INTEREST MATURITY PRINCIPAL
DESCRIPTION RATE DATE AMOUNT VALUE
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
TOTAL U.S. AGENCY BONDS
(IDENTIFIED COST $138,167,389) $ 138,167,389
----------------
SHORT-TERM INVESTMENTS (12.2%)
Fifth Third Bank Repurchase Agreement dated 12/31/98
(collateralized by 19,409,000 FNMA Pool #323020, 4.220% 01/04/99 $ 19,306,947 19,306,947
6.50%, 02/01/13, market value $19,694,079) ----------------
TOTAL SHORT-TERM INVESTMENTS
(IDENTIFIED COST $19,306,947) 19,306,947
----------------
TOTAL INVESTMENTS (99.5%) (IDENTIFIED COST $157,474,336)(1)
OTHER ASSETS LESS LIABILITIES (0.5%) 157,474,336
NET ASSETS (100%) 744,810
----------------
$ 158,219,146
----------------
----------------
</TABLE>
(1) The identified cost for Federal Tax purposes is the same as shown above.
PLEASE SEE "NOTES TO FINANCIAL STATEMENTS" FOR FURTHER INFORMATION.
accessor 58
<PAGE>
ACCESSOR FUNDS, INC.
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
VALUE AND SMALL TO INTERNATIONAL
GROWTH INCOME MID CAP EQUITY
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS
Investments, at value (Note 2) $ 177,816,876 $ 126,616,790 $ 276,781,314 $ 171,557,251
Repurchase agreements, at cost - 1,005,791 - -
-------------- -------------- -------------- --------------
TOTAL INVESTMENTS* 177,816,876 127,622,581 276,781,314 171,557,251
Cash - - - 6,436
Receivable for investments sold 4,814,801 - 21,457,216 -
Receivable for capital shares sold 1,727,331 803,490 3,452,445 491,365
Dividends and interest receivable 190,098 164,350 143,946 204,372
Open forward currency contracts - - - 5,922
Receivable for futures contract settlement - - - -
Other assets - - - 22,849
-------------- -------------- -------------- --------------
TOTAL ASSETS 184,549,106 128,590,421 301,834,921 172,288,195
LIABILITIES
Cash overdraft 2,005,887 - 2,442,261 -
Distributions payable - - - -
Payable for investments purchased 2,257,247 - 17,935,523 1,963,874
Payable for capital shares repurchased 158,698 642,008 828,395 1,462,268
Payable due to Accessor Capital (Note 3) 70,775 52,677 143,222 79,414
Money managers fee payable (Note 3) 78,487 106,919 239,775 222,563
Payable for futures contract settlement - 5,456 - -
TBA sale commitments, at value - - - -
Accrued expenses and other liabilities 101,647 68,147 86,554 206,158
-------------- -------------- -------------- --------------
TOTAL LIABILITIES 4,672,741 875,207 21,675,730 3,934,277
-------------- -------------- -------------- --------------
NET ASSETS $ 179,876,365 $ 127,715,214 $ 280,159,191 $ 168,353,918
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
NET ASSETS CONSIST OF
Paid-in capital $ 126,057,469 $ 113,488,376 $ 235,450,667 $ 133,048,687
Net unrealized appreciation of investments,
receivables, payables, and futures contracts 52,461,972 15,195,605 41,329,337 33,903,274
Undistributed net investment income - - - -
Accumulated distributions in excess of realized
gain on investments, futures contracts, and
foreign currencies - (968,767) - -
Accumulated net realized gain (loss) on invest-
ments, futures contracts, options, and foreign
currencies 1,356,924 - 3,379,187 1,401,957
-------------- -------------- -------------- --------------
NET ASSETS $ 179,876,365 $ 127,715,214 $ 280,159,191 $ 168,353,918
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
NET ASSETS
Advisor class $ 157,798,977 $ 114,728,013 $ 260,791,950 $ 149,391,158
Investor class 22,077,388 12,987,201 19,367,241 18,962,760
-------------- -------------- -------------- --------------
TOTAL $ 179,876,365 $ 127,715,214 $ 280,159,191 $ 168,353,918
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
OUTSTANDING SHARES:
Advisor class 5,463,342 5,452,700 11,083,430 8,841,563
Investor class 766,061 617,263 825,357 1,125,107
-------------- -------------- -------------- --------------
TOTAL 6,229,403 6,069,963 11,908,787 9,966,670
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
NET ASSET VALUE, OFFERING
AND REDEMPTION PRICE PER SHARE
Advisor class $ 28.88 $ 21.04 $ 23.53 $ 16.90
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
Investor class $ 28.82 $ 21.04 $ 23.47 $ 16.85
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
* Investments, at cost (Note 6) $ 125,354,904 $ 112,520,726 $ 235,451,977 $ 137,637,925
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
SHORT- U.S.
INTERMEDIATE INTERMEDIATE MORTGAGE GOVERNMENT
FIXED-INCOME FIXED-INCOME SECURITIES MONEY
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS
Investments, at value (Note 2) $ 56,307,953 $ 47,817,632 $ 146,097,346 $ 138,167,389
Repurchase agreements, at cost 21,525 50,251 3,735,000 19,306,947
-------------- -------------- -------------- --------------
TOTAL INVESTMENTS* 56,329,478 47,867,883 149,832,346 157,474,336
Cash - - 2,414 -
Receivable for investments sold - - 1,518,236 -
Receivable for capital shares sold 424,218 30,322 189,659 1,403,877
Dividends and interest receivable 961,171 904,212 960,746 2,263
Open forward currency contracts - - - -
Receivable for futures contract settlement - - 5,328 -
Other assets - - - -
-------------- -------------- -------------- --------------
TOTAL ASSETS 57,714,867 48,802,417 152,508,729 158,880,476
LIABILITIES
Cash overdraft - - - -
Distributions payable - - - 565,669
Payable for investments purchased - - 4,565,561 -
Payable for capital shares repurchased 9,913 29,075 50,105 14,893
Payable due to Accessor Capital (Note 3) 19,378 16,435 49,375 -
Money managers fee payable (Note 3) 5,884 6,970 86,881 31,060
Payable for futures contract settlement - - - -
TBA sale commitments, at value - - 1,512,193 -
Accrued expenses and other liabilities 44,415 41,074 87,609 49,708
-------------- -------------- -------------- --------------
TOTAL LIABILITIES 79,590 93,554 6,351,724 661,330
-------------- -------------- -------------- --------------
NET ASSETS $ 57,635,277 $ 48,708,863 $ 146,157,005 $ 158,219,146
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
NET ASSETS CONSIST OF
Paid-in capital $ 56,328,765 $ 48,166,753 $ 143,769,745 $ 158,221,520
Net unrealized appreciation of investments,
receivables, payables, and futures contracts 1,058,657 477,427 1,982,618 -
Undistributed net investment income 3,185 18,764 111,203 -
Accumulated distributions in excess of realized
gain on investments, futures contracts, and
foreign currencies - - - -
Accumulated net realized gain (loss) on invest-
ments, futures contracts, options, and foreign
currencies 244,670 45,919 293,439 (2,374)
-------------- -------------- -------------- --------------
NET ASSETS $ 57,635,277 $ 48,708,863 $ 146,157,005 $ 158,219,146
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
NET ASSETS
Advisor class $ 48,489,231 $ 42,453,685 $ 128,788,321 $ 153,147,924
Investor class 9,146,046 6,255,178 17,368,684 5,071,222
-------------- -------------- -------------- --------------
TOTAL $ 57,635,277 $ 48,708,863 $ 146,157,005 $ 158,219,146
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
OUTSTANDING SHARES:
Advisor class 3,889,269 3,444,188 10,228,363 153,150,703
Investor class 733,633 507,497 1,379,488 5,071,047
-------------- -------------- -------------- --------------
TOTAL 4,622,902 3,951,685 11,607,851 158,221,750
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
NET ASSET VALUE, OFFERING
AND REDEMPTION PRICE PER SHARE
Advisor class $ 12.47 $ 12.33 $ 12.59 $ 1.00
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
Investor class $ 12.47 $ 12.33 $ 12.59 $ 1.00
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
* Investments, at cost (Note 6) $ 55,270,821 $ 47,390,456 $ 147,897,794 $ 157,474,336
</TABLE>
Please see notes to financial statements for further information.
accessor 59
<PAGE>
ACCESSOR FUNDS, INC.
STATEMENTS OF OPERATIONS
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
VALUE AND SMALL TO INTERNATIONAL
GROWTH INCOME MID CAP EQUITY
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividends (net of foreign withholding taxes
of $244,115 for International Equity Portfolio,
and $1,939 for Growth Portfolio) $ 1,238,413 $ 1,983,416 $ 1,639,994 $ 1,937,967
Interest 75,128 425,419 371,675 346,768
-------------- -------------- -------------- --------------
TOTAL INVESTMENT INCOME 1,313,541 2,408,835 2,011,669 2,284,735
EXPENSES:
Management fees (Note 3) 555,738 521,474 1,226,679 930,916
Money managers fees (Note 3) 238,320 370,779 768,350 1,015,548
Transfer agent and administration fees (Note 3) 170,256 154,636 270,131 220,474
Fund accounting fees 40,041 40,211 58,387 71,856
Legal fees 31,005 20,313 50,202 31,421
Audit fees 12,989 18,755 19,159 23,232
Custodian fees 12,308 9,180 19,122 310,808
Amortization of deferred organizational expenses - - - 13,984
Registration fees 50,378 42,573 41,097 50,609
Directors fees 3,071 2,969 2,944 2,969
Printing/Postage expense 1,614 4,851 10,615 2,072
Other 9,385 7,627 8,535 11,280
Investor Class only (Notes 2 & 3):
Distribution and shareholder service fees 22,491 13,942 20,941 21,312
Administrative services fees 22,491 13,942 20,941 21,312
-------------- -------------- -------------- --------------
NET EXPENSES 1,170,087 1,221,252 2,517,103 2,727,793
-------------- -------------- -------------- --------------
NET INVESTMENT INCOME (LOSS) 143,454 1,187,583 (505,434) (443,058)
REALIZED AND UNREALIZED GAINS (LOSSES)
Net realized gains (losses) on:
Investments 13,472,712 10,807,315 15,196,539 4,703,972
Foreign exchange - - - (1,304,280)
Options - - - -
Change in net unrealized appreciation (depreciation)
of investments 36,852,522 763,235 18,018,953 21,065,999
Change in net unrealized depreciation of foreign currency - - - (46,299)
-------------- -------------- -------------- --------------
NET REALIZED AND UNREALIZED GAINS 50,325,234 11,570,550 33,215,492 24,419,392
-------------- -------------- -------------- --------------
NET INCREASE RESULTING FROM OPERATIONS $ 50,468,688 $ 12,758,133 $ 32,710,058 $ 23,976,334
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
SHORT- U.S.
INTERMEDIATE INTERMEDIATE MORTGAGE GOVERNMENT
FIXED-INCOME FIXED-INCOME SECURITIES MONEY
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividends (net of foreign withholding taxes
of $244,115 for International Equity Portfolio,
and $1,939 for Growth Portfolio) $ - $ - $ - $ -
Interest 3,282,869 2,800,536 8,865,162 3,762,484
-------------- -------------- -------------- --------------
TOTAL INVESTMENT INCOME 3,282,869 2,800,536 8,865,162 3,762,484
EXPENSES:
Management fees (Note 3) 190,353 170,642 495,210 175,048
Money managers fees (Note 3) 33,951 27,358 316,386 -
Transfer agent and administration fees (Note 3) 73,608 65,493 182,510 95,356
Fund accounting fees 37,121 34,065 74,141 30,896
Legal fees 12,485 16,426 28,784 9,542
Audit fees 18,402 18,755 22,100 16,863
Custodian fees 4,525 4,414 37,439 5,327
Amortization of deferred organizational expenses - - - -
Registration fees 30,591 30,021 38,380 24,646
Directors fees 2,973 3,080 2,980 2,584
Printing/Postage expense 2,707 4,843 5,242 6,661
Other 7,130 9,821 7,971 4,896
Investor Class only (Notes 2 & 3):
Distribution and shareholder service fees 6,826 3,764 20,108 5,390
Administrative services fees 6,826 3,764 20,108 5,390
-------------- -------------- -------------- --------------
NET EXPENSES 427,498 392,446 1,251,359 382,599
-------------- -------------- -------------- --------------
NET INVESTMENT INCOME (LOSS) 2,855,371 2,408,090 7,613,803 3,379,885
REALIZED AND UNREALIZED GAINS (LOSSES)
Net realized gains (losses) on:
Investments 1,805,578 615,501 1,204,713 2,662
Foreign exchange - - - -
Options - - (25,810) -
Change in net unrealized appreciation (depreciation)
of investments (618,921) 87,741 (454,778) -
Change in net unrealized depreciation of foreign currency - - - -
-------------- -------------- -------------- --------------
NET REALIZED AND UNREALIZED GAINS 1,186,657 703,242 724,125 2,662
-------------- -------------- -------------- --------------
NET INCREASE RESULTING FROM OPERATIONS $ 4,042,028 $ 3,111,332 $ 8,337,928 $ 3,382,547
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
</TABLE>
Please see notes to financial statements for further information.
accessor 60
<PAGE>
ACCESSOR FUNDS, INC.
STATEMENTS OF CHANGES IN NET ASSETS
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
GROWTH PORTFOLIO VALUE AND INCOME PORTFOLIO
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DEC. 31, 1998 DEC. 31, 1997 DEC. 31, 1998 DEC. 31, 1997
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment income $ 143,454 $ 461,988 $ 1,187,583 $ 816,667
Net realized gain on investments 13,472,712 16,907,790 10,807,315 9,186,661
Change in net unrealized appreciation of investments 36,852,522 4,574,902 763,235 7,639,735
-------------- -------------- -------------- --------------
NET INCREASE RESULTING FROM OPERATIONS 50,468,688 21,944,680 12,758,133 17,643,063
From Distributions:
Net investment income (157,895) (406,271) (1,171,149) (816,408)
Advisor Class - - (28,451) -
Investor Class -------------- -------------- -------------- --------------
(157,895) (460,271) (1,199,600) (816,408)
Net realized gain on investments
Advisor Class (13,128,264) (15,608,927) (10,936,917) (8,426,264)
Investor Class (1,458,188) - (1,071,932) -
-------------- -------------- -------------- --------------
(14,586,452) (15,608,927) (12,008,849) (8,426,264)
In excess of net realized gain on investments
Advisor Class - - (882,256) -
Investor Class - - (86,511) -
-------------- -------------- -------------- --------------
- - (968,767) -
-------------- -------------- -------------- --------------
NET DECREASE RESULTING FROM DISTRIBUTIONS (14,744,347) (16,069,198) (14,177,216) (9,242,672)
Capital share transactions (Note 4):
Proceeds from subscriptions 105,180,652 42,600,128 84,974,025 45,978,728
Reinvestment of distributions 10,503,938 11,189,025 8,519,703 6,614,169
Cost of redemptions (59,439,572) (32,343,403) (45,486,053) (16,233,640)
-------------- -------------- -------------- --------------
NET INCREASE RESULTING FROM CAPITAL SHARE TRANSACTIONS 56,245,018 21,445,750 48,007,675 36,359,257
TOTAL INCREASE IN NET ASSETS 91,969,359 27,321,232 46,588,592 44,759,648
NET ASSETS:
Beginning of year 87,907,006 60,585,774 81,126,622 36,366,974
-------------- -------------- -------------- --------------
End of year $ 179,876,365 $ 87,907,006 $ 127,715,214 $ 81,126,622
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
Undistributed Net Investment Income $ - $ 1,717 $ - $ 259
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
</TABLE>
Please see notes to financial statements for further information.
accessor 61
<PAGE>
ACCESSOR FUNDS, INC.
STATEMENTS OF CHANGES IN NET ASSETS
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
SMALL TO MID CAP PORTFOLIO INTERNATIONAL EQUITY PORTFOLIO
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DEC. 31, 1998 DEC. 31, 1997 DEC. 31, 1998 DEC. 31, 1997
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment loss $ (505,434) $ (3,818) $ (443,058) $ (236,704)
Net realized gain on investments, options,
and foreign currency 15,196,539 24,033,927 3,399,692 4,905,193
Change in net unrealized appreciation of investments 18,018,953 14,019,209 21,019,700 4,620,705
-------------- -------------- -------------- --------------
NET INCREASE ASSETS RESULTING FROM OPERATIONS 32,710,058 38,049,318 23,976,334 9,289,194
From Distributions:
Net realized gain on investments
Advisor Class (16,858,274) (19,306,498) (2,754,762) (4,905,193)
Investor Class (1,270,675) - (344,546) -
-------------- -------------- -------------- --------------
(18,128,949) (19,306,498) (3,099,308) (4,905,193)
In excess of net investment income - Advisor Class - (102,695) - -
In excess of net realized gain on investments - Advisor Class - - - (202,707)
-------------- -------------- -------------- --------------
NET DECREASE RESULTING FROM DISTRIBUTIONS (18,128,949) (19,409,193) (3,099,308) (5,107,900)
Capital share transactions (Note 4):
Proceeds from subscriptions 229,596,797 114,006,085 126,134,699 93,636,071
Reinvestment of distributions 8,422,677 11,867,758 1,671,525 3,517,461
Cost of redemptions (97,662,830) (84,771,366) (131,770,463) (22,913,075)
-------------- -------------- -------------- --------------
NET INCREASE (DECREASE) RESULTING FROM CAPITAL
SHARE TRANSACTIONS 140,356,644 41,102,477 (3,964,239) 74,240,457
TOTAL INCREASE IN NET ASSETS 154,937,753 59,742,602 16,912,787 78,421,751
NET ASSETS:
Beginning of year 125,221,438 65,478,836 151,441,131 73,019,380
-------------- -------------- -------------- --------------
End of year $ 280,159,191 $ 125,221,438 $ 168,353,918 $ 151,441,131
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
Undistributed Net Investment Income $ - $ - $ - $ -
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
</TABLE>
Please see notes to financial statements for further information.
accessor 62
<PAGE>
ACCESSOR FUNDS, INC.
STATEMENTS OF CHANGES IN NET ASSETS
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
INTERMEDIATE FIXED-INCOME PORTFOLIO SHORT-INTERMEDIATE FIXED-INCOME PORTFOLIO
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DEC. 31, 1998 DEC. 31, 1997 DEC. 31, 1998 DEC. 31, 1997
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment income $ 2,855,371 $ 2,899,193 $ 2,408,090 $ 2,097,549
Net realized gain on investments 1,805,578 36,784 615,501 6,148
Change in net unrealized appreciation
(depreciation) of investments (618,921) 1,080,463 87,741 412,603
------------- ------------- ------------- -------------
NET INCREASE RESULTING FROM OPERATIONS 4,042,028 4,016,440 3,111,332 2,516,300
From Distributions:
Net investment income
Advisor Class (2,691,289) (2,900,522) (2,311,435) (2,098,114)
Investor Class (140,300) - (76,102) -
------------- ------------- ------------- -------------
(2,831,589) (2,900,522) (2,387,537) (2,098,114)
Net realized gain on investments
Advisor Class (172,760) - (455,892) -
Investor Class (32,535) - (66,763) -
------------- ------------- ------------- -------------
(205,295) - (522,655) -
In excess of net investment income - Advisor Class - - - (4,419)
------------- ------------- ------------- -------------
NET DECREASE RESULTING FROM DISTRIBUTIONS (3,036,884) (2,900,522) (2,910,192) (2,102,533)
Capital share transactions (Note 4):
Proceeds from subscriptions 44,151,859 22,943,316 24,488,550 20,305,381
Reinvestment of distributions 998,916 1,033,657 669,137 249,894
Cost of redemptions (43,717,552) (22,143,716) (17,592,006) (16,727,519)
------------- ------------- ------------- -------------
NET INCREASE RESULTING FROM CAPITAL SHARE TRANSACTIONS 1,433,223 1,833,257 7,565,681 3,827,756
TOTAL INCREASE IN NET ASSETS 2,438,367 2,949,175 7,766,821 4,241,523
NET ASSETS:
Beginning of year 55,196,910 52,247,735 40,942,042 36,700,519
------------- ------------- ------------- -------------
End of year $ 57,635,277 $ 55,196,910 $ 48,708,863 $ 40,942,042
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
Undistributed Net Investment Income $ 3,185 $ - $ 18,764 $ -
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
</TABLE>
Please see notes to financial statements for further information.
accessor 63
<PAGE>
ACCESSOR FUNDS, INC.
STATEMENTS OF CHANGES IN NET ASSETS
DECEMBER 31, 1998
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
MORTGAGE SECURITIES PORTFOLIO U.S. GOVERNMENT MONEY PORTFOLIO
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DEC. 31, 1998 DEC. 31, 1997 DEC. 31, 1998 DEC. 31, 1997
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment income $ 7,613,803 $ 5,380,667 $ 3,379,885 $ 2,774,101
Net realized gain (loss) on investments 1,178,903 1,115,943 2,662 (5,036)
Change in net unrealized appreciation
(depreciation) of investments (454,778) 1,939,701 - -
-------------- -------------- -------------- --------------
NET INCREASE RESULTING FROM OPERATIONS 8,337,928 8,436,311 3,382,547 2,769,065
From Distributions:
Net investment income
Advisor Class (7,113,868) (5,380,667) (3,286,631) (2,774,283)
Investor Class (434,773) - (93,249) -
-------------- -------------- -------------- --------------
(7,548,641) (5,380,667) (3,379,880) (2,774,283)
Net realized gain on investments
Advisor Class (1,038,630) (408,792) - -
Investor Class (98,940) - - -
-------------- -------------- -------------- --------------
(1,137,570) (408,792) - -
In excess of net investment income - Advisor Class - (37,546) - -
-------------- -------------- -------------- --------------
NET DECREASE RESULTING FROM DISTRIBUTIONS (8,686,211) (5,827,005) (3,379,880) (2,774,283)
Capital share transactions (Note 4):
Proceeds from subscriptions 74,612,172 46,306,046 276,126,293 93,789,512
Reinvestment of distributions 1,725,139 1,482,818 151,860 59,844
Cost of redemptions (39,579,070) (14,513,511) (168,971,567) (104,606,175)
-------------- -------------- -------------- --------------
NET INCREASE (DECREASE) RESULTING FROM CAPITAL
SHARE TRANSACTIONS 36,758,241 33,275,353 107,306,586 (10,756,819)
TOTAL INCREASE (DECREASE) IN NET ASSETS 36,409,958 35,884,659 107,309,253 (10,762,037)
NET ASSETS:
Beginning of year 109,747,047 73,862,388 50,909,893 61,671,930
-------------- -------------- -------------- --------------
End of year $ 146,157,005 $ 109,747,047 $ 158,219,146 $ 50,909,893
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
Undistributed Net Investment Income $ 111,203 $ - $ - $ -
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
</TABLE>
Please see notes to financial statements for further information.
accessor 64
<PAGE>
ACCESSOR FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
FOR YEAR ENDING DECEMBER 31, 1998
1. ORGANIZATION
Accessor Funds, Inc. (the "Fund") is registered under the Investment
Company Act of 1940, as amended, as an open-end management investment
company consisting of eight diversified investment portfolios: Growth
Portfolio, Value and Income Portfolio, Small to Mid Cap Portfolio (the
"Equity Portfolios"), International Equity Portfolio (the "International
Portfolio"), Intermediate Fixed-Income Portfolio, Short-Intermediate
Fixed-Income Portfolio, Mortgage Securities Portfolio (the "Bond
Portfolios"), and U.S. Government Money Portfolio (the "Money Portfolio")
(individually, a "Portfolio", collectively, the "Portfolios"). The Fund was
incorporated in Maryland on June 10, 1991. Each Portfolio offers two
classes of shares, Advisor Class Shares and Investor Class Shares. Both
classes of shares have identical rights and privileges except with respect
to expenses specific to each class, and voting rights on matters affecting
a single class, including distribution, shareholder service and
administrative services arrangements.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by
the Portfolios.
SECURITY VALUATION
Equity securities listed and traded principally on a national securities
exchange are valued on the basis of last sale price on such exchange on the
day of valuation or, if no sale occurred on such day, at the closing bid
price on the primary exchange on which the security is traded. Domestic
over-the-counter equity and fixed income securities and options are valued
on the basis of the closing bid price. International securities traded
over-the-counter are valued on the basis of the mean of bid prices. Futures
contracts are valued on the basis of the last sales price.
Domestic fixed-income securities and other assets for which market
quotations are readily available (other than obligations with remaining
maturities of 60 days or less) are valued on the basis of quotations
obtained from dealers or pricing services with consideration of such
factors as institutional-sized trading in similar groups of securities,
quality, yield, coupon rate, maturity, type of issue, trading
characteristics and other market data.
Investments in the Money Portfolio and short-term investments maturing in
60 days or less are valued at amortized cost, which approximates market
value.
Investments for which market quotations are not readily available are
valued at their fair value as determined in good faith in accordance with
procedures adopted by the Board of Directors.
SECURITY TRANSACTIONS AND INVESTMENT INCOME
Securities transactions are accounted for on the date the securities are
purchased or sold (trade date). Interest income is recorded on the accrual
basis. All premiums and discounts are amortized or accreted for both
financial statement and tax reporting purposes as required by Federal
Income Tax regulations. Dividend income, less foreign tax withheld, is
recorded on the ex-dividend date or upon receipt of ex-dividend
notification in the case of certain foreign securities. Realized gains and
losses on the sale of investments are determined on the identified cost
basis.
FOREIGN CURRENCY TRANSACTIONS
The books and records of the Portfolios are maintained in U.S. dollars. The
Bond Portfolios may purchase debt obligations that are payable in a foreign
currency, and the International Portfolio and Equity Portfolios may
purchase equity securities that are payable in a foreign currency. For
these Portfolios, investment securities, other assets and liabilities
denominated in a foreign currency are translated into U.S. dollars at the
exchange rate on the day of valuation. Purchases and sales of securities,
income receipts and expense payments are translated into U.S. dollars at
the rate on the dates of the transactions.
Reported net realized foreign exchange gains or losses arise from sales of
securities denominated in foreign currencies, purchases and sales of
foreign currencies, currency gains or losses realized between the trade and
settlement dates of securities transactions, and the difference between the
amount of expenses recorded on each of the Portfolio's books and the U.S.
dollar equivalent of the amounts actually received or paid. Net unrealized
foreign exchange gains or losses arise from changes in the value of assets
and liabilities, including investments in securities, resulting from
changes in the exchange rates.
The Portfolios (other than the Money Portfolio) report certain foreign
currency related security transactions as components of realized gains or
losses in the statements of operations for financial reporting purposes,
whereas such components are treated as ordinary income for Federal income
tax purposes. The Portfolios isolate that portion of the results of
operations resulting from changes in the foreign exchange rates on
investments from the fluctuation arising from changes in market prices of
equity securities.
Foreign security and currency transactions may involve certain
considerations and risks not typically associated with those of U.S. dollar
denominated transactions. These risks include political or economic
instability in the country of the issuer, the
accessor 65
<PAGE>
ACCESSOR FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
FOR YEAR ENDING DECEMBER 31, 1998
difficulty of predicting international trade patterns, the possibility of
imposition of exchange controls and the risk of currency fluctuations.
OFF-BALANCE SHEET RISK
The Portfolios may trade financial instruments with off-balance sheet risk
in the normal course of investing activities and to assist in managing
exposure to market risks such as interest rates and foreign currency
exchange rates. These financial instruments include forward foreign
currency exchange contracts, futures contracts and options transactions.
The notional or contractual amounts of these instruments represent the
investment the Portfolios have in particular classes of financial
instruments and do not necessarily represent the amounts potentially
subject to risk. The measurement of the risks associated with these
instruments is meaningful only when all related and offsetting transactions
are considered.
FUTURES CONTRACTS
The Portfolios (other than the Money Portfolio) are permitted to enter into
financial futures contracts and stock index futures contracts in accordance
with their investment objectives. The International Portfolio may also
purchase and write futures contracts on foreign currencies. A Portfolio is
required to deposit either in cash or securities an amount equal to a
certain percentage of the contract amount. Subsequent payments are made or
received by a Portfolio each day, dependent on daily fluctuations in the
value of the contract. Such payments or receipts are known as variation
margin and are recorded for financial statement purposes as unrealized
gains or losses by a Portfolio. Should interest rates move unexpectedly, a
Portfolio may not achieve the anticipated benefits of the financial futures
contracts and may realize a loss. When the contract is closed, a Portfolio
records a realized gain or loss equal to the difference between the value
of the contract at the time it was opened and the value at the time it was
closed. The potential risk to the Portfolios is that the change in the
value of the underlying securities may not correlate to the change in value
of the contracts.
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
The International Portfolio will generally enter into forward foreign
currency exchange contracts as a way of managing foreign exchange rate
risk. It may enter into these contracts to fix the U.S. dollar value of a
security that it has agreed to buy or sell for the period between the date
the trade was entered into and the date the security is delivered and paid
for. The International Portfolio may also use these contracts to hedge the
U.S. dollar value of securities it already owns denominated in foreign
currencies. Forward foreign currency contracts are valued at the forward
rate and are marked-to-market daily. The change in value is recorded as an
unrealized gain or loss until the contract settlement date, at which time
the Portfolio records a realized gain or loss equal to the difference
between the value of the contract at the time it was opened and the value
at the time it was closed.
The use of forward foreign currency contracts does not eliminate
fluctuations in the underlying prices of the International Portfolio's
securities, but it does establish a rate of exchange that can be achieved
in the future. Although forward foreign currency contracts limit the risk
of loss due to a decline in the value of the hedged currency, they also
limit any potential gain that might result should the value of the currency
increase. In addition, the International Portfolio could be exposed to
risks if the counterparties to the contracts are unable to meet the terms
of their contracts.
OPTIONS TRANSACTIONS
The Portfolios (other than the Money Portfolio) may purchase and sell call
and put options on securities and securities indices, provided such options
are traded on a national securities exchange or in an over-the-counter
market. These Portfolios may also purchase and sell call and put options on
foreign currencies. The Equity Portfolios may utilize options to equitize
liquidity reserve balances.
When any of the Portfolios writes a covered call or put option, an amount
equal to the premium received is included in that Portfolio's statement of
assets and liabilities as a liability. The amount of the liability is
subsequently marked-to-market to reflect the current market value of the
option. If an option expires on its stipulated expiration date or if the
Portfolio enters into a closing purchase transaction, a gain or loss is
realized. If a written call option is exercised, a gain or loss is realized
for the sale of the underlying security and the proceeds from the sale are
increased by the premium originally received. If a written put option is
exercised, the cost of the security acquired is decreased by the premium
originally received. As writer of an option, the Portfolio has no control
over whether the underlying securities are subsequently sold (call) or
purchased (put) and, as a result, bears the market risk of an unfavorable
change in the price of the security underlying the written option.
When any of the Portfolios purchases a call or put option, an amount equal
to the premium paid is included in that Portfolio's statement of assets and
liabilities as an investment, and is subsequently marked-to-market to
reflect the current market value of the option. If an option expires on the
stipulated expiration date or if a Portfolio enters into a closing sale
transaction, a gain or loss is realized. If a Portfolio exercises a call,
the cost of the security acquired is increased by the premium paid for the
call. If a Portfolio exercises a put option, a gain or loss is realized
from the sale of the underlying security, and the proceeds from such sale
are decreased by the premium originally paid. Written and purchased options
are non-income producing securities.
accessor 66
<PAGE>
ACCESSOR FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
FOR YEAR ENDING DECEMBER 31, 1998
The option techniques utilized are to hedge against changes in interest
rates, foreign currency exchange rates or securities prices in order to
establish more definitely the effective return on securities or currencies
held or intended to be acquired by a Portfolio, to reduce the volatility of
the currency exposure associated with investment in non-U.S. securities, or
as an efficient means of adjusting exposure to the bond, equity and
currency markets and not for speculation.
REPURCHASE AGREEMENTS
The Portfolios may enter into repurchase agreements (agreements to purchase
U.S. Treasury notes and bills, subject to the seller's agreement to
repurchase them at a specified time and price) with well-established
dealers or institutions that the Portfolios' management has determined to
be creditworthy. It is the Portfolios' policy to take possession of the
underlying securities and, on a daily basis, mark-to-market such securities
to ensure that the market value including accrued interest is at least
equal to the amount owed to the Portfolios under each repurchase agreement.
DISTRIBUTIONS TO SHAREHOLDERS
Distributions from net investment income are declared daily and paid
monthly for the Money Portfolio; declared and paid monthly for the Bond
Portfolios; declared and paid quarterly for the Equity Portfolios; declared
and paid annually for the International Portfolio. Distributions of net
realized gains, if any, will be declared and paid at least annually for all
Portfolios. Distributions to shareholders are recorded on the ex-dividend
date.
Income distributions and capital gain distributions are determined in
accordance with income tax regulations which may differ from generally
accepted accounting principles.
FEDERAL INCOME TAXES
It is each Portfolio's intention to comply with the requirements of the
Internal Revenue Code (the "Code") to qualify as a regulated investment
company and distribute all of its taxable income and realized gains, if
any, to shareholders. In addition, by distributing all of its taxable
income and realized gains to shareholders, the Portfolios will not be
subject to a Federal excise tax. Accordingly, no provision for Federal
income taxes is required in the financial statements.
Each Portfolio files a tax return annually using tax accounting methods
required under provisions of the Code which may differ from generally
accepted accounting principles, the basis on which these financial
statements are prepared. The differences arise primarily from the treatment
of foreign currency transactions and futures contracts and the deferral of
certain losses under Federal income tax regulations. Accordingly, the
amount of net investment income and net realized gains or losses reported
in these financial statements may differ from that reported in each
Portfolio's tax return and, consequently, the character of distributions to
shareholders reported in the financial highlights may differ from that
reported to shareholders for Federal income tax purposes. Distributions
which exceed net investment income and net realized gains for financial
reporting purposes but not for tax purposes, if any, are shown as
distributions in excess of net investment income and net realized gains in
the accompanying financial statements. Net investment losses, for tax
purposes, are reclassified to paid-in capital.
FORWARD COMMITMENTS
The Portfolios may contract to purchase securities for a fixed price at a
future date beyond the customary settlement period (i.e. "when issued,"
"delayed delivery," "forward commitment" or "TBA") consistent with a
Portfolio's ability to manage its investment portfolio and meet redemption
requests. These transactions involve a commitment by a Portfolio to
purchase or sell securities for a predetermined price or yield with payment
and delivery taking place more than three days in the future, or after a
period longer than the customary settlement period for that type of
security. No interest will be earned by a Portfolio on such purchases until
the securities are delivered; however the market value may change prior to
delivery.
Unsettled TBA sale commitments are valued at the current market value of
the underlying securities, generally according to the procedures described
under "Security Valuation" above. The contract is "marked-to-market" daily
and the change in market value is recorded by the portfolio as an
unrealized gain or loss. If the TBA sale commitment is closed through the
acquisition of an offsetting purchase commitment, the Portfolio realizes a
gain or loss from the sale of the securities based upon the unit price
established at the date the commitment was entered into.
ORGANIZATIONAL EXPENSES
Organizational expenses are being amortized on a straight-line basis over a
period not to exceed 60 months.
OTHER
Shared expenses incurred by the Fund are allocated among the Portfolios
based on each Portfolio's ratio of relative net assets to the combined net
assets. Specifically identified direct expenses are charged to each
Portfolio as incurred. Investment
accessor 67
<PAGE>
ACCESSOR FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
FOR YEAR ENDING DECEMBER 31, 1998
income, realized and unrealized gains and losses and Portfolio expenses
not specific to any class of shares are prorated among the classes based
upon the relative net assets of each class. Specifically identified
direct expenses of each class are charged to that class as incurred to
the extent practicable.
ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
3. RELATED PARTY TRANSACTIONS
MANAGER
The Fund has a management agreement with Accessor Capital Management LP
("Accessor Capital"), formerly Bennington Capital Management L.P. Pursuant
to this agreement, Accessor Capital operates and administers the provision
of all general management, investment advisory and portfolio management
services. Accessor Capital also manages the U.S. Government Money
Portfolio. Fees paid to Accessor Capital are computed monthly based on the
following annualized rates calculated on the average daily net assets of
each Portfolio:
<TABLE>
<CAPTION>
PORTFOLIO ANNUAL MANAGEMENT FEE
------------------------------------------------------------
<S> <C>
Growth 0.45%
Value and Income 0.45
Small to Mid Cap 0.60
International Equity 0.55
Intermediate Fixed-Income 0.36
Short-Intermediate Fixed-Income 0.36
Mortgage Securities 0.36
U.S. Government Money 0.25
</TABLE>
MONEY MANAGERS
Each Portfolio's assets (other than the U.S. Government Money Portfolio)
are invested by an investment management organization (individually, a
"Money Manager"; collectively, the "Money Managers"), researched and
recommended by Accessor Capital. For the first five complete calendar
quarters of investment operations for a Portfolio, each Portfolio will pay
its respective Money Manager on a quarterly basis an annual fee based on
the average daily net assets of the Portfolio managed by such Money
Manager. This fee has two components, the Basic Fee and the Portfolio
Management Fee. Commencing with the sixth calendar quarter of investment
operations for each Portfolio, the Money Manager fee consists of two
components, the Basic Fee and the Performance Fee.
The Performance Fee component is adjusted each quarter based on the
annualized investment performance of each Money Manager relative to the
annualized investment performance of the following benchmark indices, which
may be changed only with the approval of the Fund's Board of Directors:
<TABLE>
<CAPTION>
PORTFOLIO INDEX
-----------------------------------------------------------------------------------------------------
<S> <C>
Growth S&P 500/BARRA Growth Index
Value and Income S&P 500/BARRA Value Index
Small to Mid Cap Wilshire 4500 Index
International Equity Morgan Stanley Capital International EAFE-R- + EMF Index
Intermediate Fixed-Income Lehman Brothers Government/Corporate Index
Short-Intermediate Fixed-Income Lehman Brothers Government/Corporate 1-5 Year Index
Mortgage Securities Lehman Brothers Mortgage-Backed Securities Index
</TABLE>
accessor 68
<PAGE>
ACCESSOR FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
FOR YEAR ENDING DECEMBER 31, 1998
For the year ended December 31, 1998, the following Basic Fees, Portfolio
Management Fees and Performance Fees were calculated based on the average
daily net assets of the Portfolios:
<TABLE>
<CAPTION>
PORTFOLIO
BASIC MANAGEMENT PERFORMANCE TOTAL
PORTFOLIO QUARTER FEE FEE FEE FEE
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
GROWTH 1st Quarter 0.10% 0.10% - 0.20%
2nd Quarter 0.10% 0.10% - 0.20%
3rd Quarter 0.10% 0.10% - 0.20%
4th Quarter 0.10% 0.10% - 0.20%
VALUE AND INCOME 1st Quarter 0.10% - 0.22% 0.32%
2nd Quarter 0.10% - 0.22% 0.32%
3rd Quarter 0.10% - 0.22% 0.32%
4th Quarter 0.10% - 0.22% 0.32%
SMALL TO MID CAP 1st Quarter 0.10% - 0.22% 0.32%
2nd Quarter 0.10% - 0.22% 0.32%
3rd Quarter 0.00% - 0.42% 0.42%
4th Quarter 0.00% - 0.42% 0.42%
INTERNATIONAL 1st Quarter 0.20% - 0.40% 0.60%
EQUITY 2nd Quarter 0.20% - 0.40% 0.60%
3rd Quarter 0.20% - 0.40% 0.60%
4th Quarter 0.20% - 0.40% 0.60%
INTERMEDIATE 1st Quarter 0.07% - 0.08% 0.15%
FIXED-INCOME 2nd Quarter 0.07% - 0.08% 0.15%
3rd Quarter* 0.00% - 0.00% 0.00%
4th Quarter 0.02% 0.02% 0.00% 0.04%
SHORT- 1st Quarter 0.07% - 0.08% 0.15%
INTERMEDIATE 2nd Quarter 0.07% - 0.08% 0.15%
FIXED-INCOME 3rd Quarter* 0.00% - 0.00% 0.00%
4th Quarter 0.02% 0.02% 0.00% 0.04%
MORTGAGE 1st Quarter 0.07% - 0.16% 0.23%
SECURITIES 2nd Quarter 0.07% - 0.16% 0.23%
3rd Quarter 0.07% - 0.16% 0.23%
4th Quarter 0.07% - 0.16% 0.23%
</TABLE>
* ACCESSOR CAPITAL DIRECTLY MANAGED THE ASSETS OF THESE PORTFOLIOS. THUS,
NO MONEY MANAGER FEES ASSOCIATED WITH THESE PORTFOLIOS WERE INCURRED DURING
3RD QUARTER.
DISTRIBUTION AND SHAREHOLDER SERVICE PLANS
The Fund has adopted a Distribution Plan under Rule 12b-1 of the Investment
Company Act of 1940 with respect to the Investor Class Shares of each
Portfolio to reimburse third party intermediaries or other service
organizations each month for distribution-related expenses incurred. Under
the terms of the Distribution Plan, the Fund will reimburse third party
selling and distribution agents responsible for sales and promotional
efforts including printing of prospectuses and reports used for sales
purposes. The Fund has adopted a Shareholder Service Plan with respect to
the Investor Class Shares of each Portfolio to reimburse third party
service organizations who provide account maintenance services.
The maximum amount payable to service organizations under the Distribution
Plan and Shareholder Service Plan, in aggregate, may not exceed on an
annual basis 0.25% of the average daily net assets of each Portfolio
attributable to Investor Class Shares. No 12b-1 fees were incurred during
1998. All shareholder service fees were paid to third party service
organizations.
ADMINISTRATIVE SERVICES PLAN
The Fund has adopted an Administrative Services Plan with respect to the
Investor Class Shares of each Portfolio to reimburse third party service
organizations who provide administrative and support services. The maximum
amount payable to service organizations under the Administrative Services
Plan for these expenses on an annual basis is 0.25% of the average daily
net assets of each Portfolio attributable to Investor Class Shares,
provided, however, that no Portfolio shall directly or indirectly pay any
distribution-related amounts that will be allocated under the Fund's
Distribution Plan. All administrative services fees were paid to third
party service organizations.
accessor 69
<PAGE>
ACCESSOR FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
FOR YEAR ENDING DECEMBER 31, 1998
TRANSFER AGENT AND ADMINISTRATION
The Fund has a Transfer Agency and Administrative Agreement with Accessor
Capital. Pursuant to this agreement, Accessor Capital acts as transfer
agent and administrator to the Fund, performing all transfer agent and
certain compliance services. The fees are computed at the annual rate of
0.13% expressed as a percentage of the average daily net assets per
Portfolio.
4. SHARES OF STOCK
The Fund, incorporated in Maryland on June 10, 1991, is authorized to issue
15,000,000,000 shares of Common Stock, $.001 par value. Transactions in
shares of the Portfolios were as follows:
<TABLE>
<CAPTION>
Growth Portfolio Growth Portfolio
(Advisor Class) (Investor Class)
Shares Amount Shares Amount
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1998
Shares subscribed 3,402,974 $ 85,951,964 732,542 $19,228,688
Shares issued on reinvestment
of distributions 321,041 9,129,445 47,659 1,374,493
Shares redeemed (2,335,317) (59,072,350) (14,140) (367,222)
------------ ------------- ------- -----------
Net increase (decrease) 1,388,698 $ 36,009,059 766,061 $20,235,959
YEAR ENDED DECEMBER 31, 1997
Shares subscribed 1,828,825 $ 42,600,128
Shares issued on reinvestment
of distributions 511,145 11,189,025
Shares redeemed (1,370,970) (32,343,403)
------------ -------------
Net increase (decrease) 969,000 $ 21,445,750
<CAPTION>
VALUE AND INCOME PORTFOLIO VALUE AND INCOME PORTFOLIO
(ADVISOR CLASS) (INVESTOR CLASS)
SHARES AMOUNT SHARES AMOUNT
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1998
Shares subscribed 3,235,994 $ 71,808,692 575,624 $13,165,333
Shares issued on reinvestment
of distributions 351,229 7,460,324 50,458 1,059,379
Shares redeemed (2,019,203) (45,293,298) (8,819) (192,755)
------------ ------------- ------- -----------
Net increase (decrease) 1,568,020 $ 33,975,718 617,263 $14,031,957
YEAR ENDED DECEMBER 31, 1997
Shares subscribed 2,267,839 $ 45,978,728
Shares issued on reinvestment
of distributions 317,161 6,614,169
Shares redeemed (749,022) (16,233,640)
------------ -------------
Net increase (decrease) 1,835,978 $ 36,359,257
<CAPTION>
SMALL TO MID CAP PORTFOLIO SMALL TO MID CAP PORTFOLIO
(ADVISOR CLASS) (INVESTOR CLASS)
SHARES AMOUNT SHARES AMOUNT
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1998
Shares subscribed 9,320,690 $210,763,396 787,121 $18,833,401
Shares issued on reinvestment
of distributions 308,678 7,185,331 53,104 1,237,346
Shares redeemed (4,285,782) (97,340,937) (14,868) (321,893)
------------ ------------- ------- -----------
Net increase (decrease) 5,343,586 $120,607,790 825,357 $19,748,854
YEAR ENDED DECEMBER 31, 1997
Shares subscribed 5,314,273 $ 114,006,085
Shares issued on reinvestment
of distributions 544,550 11,867,758
Shares redeemed (3,598,865) (84,771,366)
------------ -------------
Net increase (decrease) 2,259,958 $ 41,102,477
</TABLE>
accessor 70
<PAGE>
ACCESSOR FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
FOR YEAR ENDING DECEMBER 31, 1998
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY PORTFOLIO INTERNATIONAL EQUITY PORTFOLIO
(ADVISOR CLASS) (INVESTOR CLASS)
SHARES AMOUNT SHARES AMOUNT
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1998
Shares subscribed 6,463,056 $106,249,826 1,122,863 $19,884,873
Shares issued on reinvestment
of distributions 79,349 1,335,439 20,017 336,086
Shares redeemed (7,914,102) (131,480,826) (17,773) (289,637)
------------ ------------- --------- -----------
Net increase (decrease) (1,371,697) $(23,895,561) 1,125,107 $19,931,322
YEAR ENDED DECEMBER 31, 1997
Shares subscribed 6,193,641 $93,636,071
Shares issued on reinvestment
of distributions 235,796 3,517,461
Shares redeemed (1,497,678) (22,913,075)
------------ -------------
Net increase (decrease) 4,931,759 $74,240,457
<CAPTION>
INTERMEDIATE FIXED-INCOME INTERMEDIATE FIXED-INCOME
PORTFOLIO PORTFOLIO
(ADVISOR CLASS) (INVESTOR CLASS)
SHARES AMOUNT SHARES AMOUNT
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1998
Shares subscribed 2,812,050 $ 34,756,600 758,860 $ 9,395,259
Shares issued on reinvestment
of distributions 72,912 899,472 7,981 99,444
Shares redeemed (3,524,161) (43,301,432) (33,208) (416,120)
------------ ------------- --------- -----------
Net increase (decrease) (639,199) ($7,645,360) 733,633 $ 9,078,583
YEAR ENDED DECEMBER 31, 1997
Shares subscribed 1,908,703 $ 22,943,316
Shares issued on reinvestment
of distributions 86,534 1,033,657
Shares redeemed (1,855,513) (22,143,716)
------------ -------------
Net increase (decrease) 139,724 $ 1,833,257
<CAPTION>
SHORT-INTERMEDIATE FIXED-INCOME SHORT-INTERMEDIATE FIXED-INCOME
PORTFOLIO PORTFOLIO
(ADVISOR CLASS) (INVESTOR CLASS)
SHARES AMOUNT SHARES AMOUNT
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1998
Shares subscribed 1,468,493 $ 18,169,344 506,360 $ 6,319,206
Shares issued on reinvestment
of distributions 49,077 600,883 5,534 68,254
Shares redeemed (1,410,917) (17,537,006) (4,397) (55,000)
------------ ------------- --------- -----------
Net increase (decrease) 106,653 $ 1,233,221 507,497 $ 6,332,460
YEAR ENDED DECEMBER 31, 1997
Shares subscribed 1,669,600 $ 20,305,381
Shares issued on reinvestment
of distributions 20,522 249,894
Shares redeemed (1,370,087) (16,727,519)
------------ -------------
Net increase (decrease) 320,035 $ 3,827,756
</TABLE>
accessor 71
<PAGE>
ACCESSOR FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
FOR YEAR ENDING DECEMBER 31, 1998
<TABLE>
<CAPTION>
MORTGAGE SECURITIES PORTFOLIO MORTGAGE SECURITIES PORTFOLIO
(ADVISOR CLASS) (INVESTOR CLASS)
SHARES AMOUNT SHARES AMOUNT
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1998
Shares subscribed 4,501,044 $ 57,136,825 1,378,173 $17,475,347
Shares issued on reinvestment
of distributions 127,522 1,611,774 9,003 113,365
Shares redeemed (3,112,328) (39,481,462) (7,688) (97,608)
------------ ------------- --------- -----------
Net increase (decrease) 1,516,238 $ 19,267,137 1,379,488 $17,491,104
YEAR ENDED DECEMBER 31, 1997
Shares subscribed 3,723,266 $ 46,306,046
Shares issued on reinvestment
of distributions 119,485 1,482,818
Shares redeemed (1,168,546) (14,513,511)
------------ -------------
Net increase (decrease) 2,674,205 $ 33,275,353
<CAPTION>
U.S. GOVERNMENT MONEY U.S. GOVERNMENT MONEY
PORTFOLIO PORTFOLIO
(ADVISOR CLASS) (INVESTOR CLASS)
SHARES AMOUNT SHARES AMOUNT
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1998
Shares subscribed 268,676,066 $ 268,676,067 7,450,226 $ 7,450,226
Shares issued on reinvestment
of distributions 151,613 151,613 247 247
Shares redeemed (166,592,141) (166,592,141) (2,379,426) (2,379,426)
------------ -------------- ---------- -----------
Net increase (decrease) 102,235,538 $ 102,235,539 5,071,047 $ 5,071,047
YEAR ENDED DECEMBER 31, 1997
Shares subscribed 93,789,699 $ 93,789,512
Shares issued on reinvestment
of distributions 59,844 59,844
Shares redeemed (104,606,175) (104,606,175)
------------- --------------
Net increase (decrease) (10,756,632) $ (10,756,819)
</TABLE>
5. SECURITIES TRANSACTIONS
During the year ended December 31, 1998, purchases and sales of
investments, other than short-term investments and U.S. Government
securities aggregated, were as follows:
<TABLE>
<CAPTION>
PORTFOLIO PURCHASES SALES
-----------------------------------------------------------------------------------------
<S> <C> <C>
Growth $176,071,252 $136,919,267
Value and Income 149,190,409 110,679,541
Small to Mid Cap 357,867,650 236,321,068
International Equity 320,490,666 329,141,944
Intermediate Fixed-Income 34,131,438 12,832,737
Short-Intermediate Fixed-Income 18,320,250 1,170,000
Mortgage Securities 36,791,923 23,236,056
</TABLE>
During the year ended December 31, 1998, purchases and sales of long-term
U.S. Government securities, were as follows:
<TABLE>
<CAPTION>
PORTFOLIO PURCHASES SALES
-----------------------------------------------------------------------------------------
<S> <C> <C>
Intermediate Fixed-Income $ 26,304,509 $ 42,978,143
Short-Intermediate Fixed-Income 20,561,643 30,390,223
Mortgage Securities 342,965,330 337,622,220
</TABLE>
accessor 72
<PAGE>
ACCESSOR FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
FOR YEAR ENDING DECEMBER 31, 1998
6. IDENTIFIED COST
The identified cost for federal income tax purposes of investments owned by
each Portfolio, their respective gross unrealized appreciation/
(depreciation), and resulting net unrealized appreciation/(depreciation)
as applicable at December 31, 1998 were as follows:
<TABLE>
<CAPTION>
IDENTIFIED GROSS UNREALIZED GROSS UNREALIZED NET UNREALIZED
COST APPRECIATION (DEPRECIATION) APPRECIATION
--------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Growth $ 125,273,653 $ 52,927,501 $ (384,279) $ 52,543,222
Value and Income 113,491,930 19,576,341 (5,351,940) 14,224,401
Small to Mid Cap 235,550,497 48,161,067 (6,930,250) 41,230,817
International Equity 137,998,069 36,136,398 (2,577,216) 33,559,182
Intermediate Fixed-Income 55,271,892 1,212,518 (154,932) 1,057,586
Short-Intermediate Fixed-Income 47,390,456 550,761 (73,334) 477,427
Mortgage Securities 147,940,388 2,197,647 (257,623) 1,940,024
</TABLE>
7. DIVIDENDS
The following dividends were declared from net investment income with an
ex-date of January 29, 1999, payable on February 1, 1999, to the
shareholders of record on January 28, 1999:
<TABLE>
<CAPTION>
PORTFOLIO ADVISOR CLASS INVESTOR CLASS
-----------------------------------------------------------------------------------------
<S> <C> <C>
Intermediate Fixed- Income $0.053438 $0.048417
Short-Intermediate Fixed-Income 0.050539 0.045481
Mortgage Securities 0.057049 0.051973
</TABLE>
accessor 73
<PAGE>
ACCESSOR FUNDS, INC.
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
INVESTOR(1)
ADVISOR CLASS CLASS
GROWTH PORTFOLIO 1998 1997 1996 1995 1994 1998
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, beginning of period $ 21.57 $ 19.51 $ 17.99 $ 14.37 $ 14.16 $ 26.38
---------- ---------- ---------- ---------- ---------- -----------
Net investment income (loss) 0.04 0.13 0.19 0.15 0.13 (0.05)
Net realized and unrealized gain on
investments 9.91 6.31 3.35 4.76 0.42 4.52
---------- ---------- ---------- ---------- ---------- -----------
Total from investment operations 9.95 6.44 3.54 4.91 0.55 4.47
---------- ---------- ---------- ---------- ---------- -----------
Distributions from net investment
income (0.03) (0.13) (0.19) (0.15) (0.13) -
Distributions from capital gains (2.61) (4.25) (1.83) (1.14) (0.21) (2.03)
---------- ---------- ---------- ---------- ---------- -----------
Total distributions (2.64) (4.38) (2.02) (1.29) (0.34) (2.03)
---------- ---------- ---------- ---------- ---------- -----------
Net Asset Value, end of period $ 28.88 $ 21.57 $ 19.51 $ 17.99 $ 14.37 $ 28.82
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Total return (2) 46.65 % 33.24 % 19.83 % 34.32 % 3.99 % 16.96 %
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Net assets, end of period (in thousands) $ 157,799 $ 87,907 $ 60,586 $ 48,532 $ 23,534 $ 22,077
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Ratios of expenses to average net
assets:
After Accessor Capital fee waivers 0.92 % 0.93 % 1.13 % 1.26 % 1.76 % 1.41 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Before Accessor Capital fee
waivers 0.92 % 0.93 % 1.13 % 1.26 % 1.83 % 1.41 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Ratio of net investment income
(loss) to average net assets
After Accessor Capital fee
waivers 0.16 % 0.56 % 0.97 % 0.97 % 1.02 % (0.40)%*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Before Accessor Capital fee
waivers 0.16 % 0.56 % 0.97 % 0.97 % 0.95 % (0.40)%*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Portfolio turnover rate 112.42 % 131.75 % 81.79 % 99.73 % 57.71 % 112.42 %
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
</TABLE>
(1) Class commenced operations on July 01, 1998.
(2) Total return is calculated assuming a purchase of shares at net asset
value per share on the first day and a sale at net asset value per share
on the last day of each period reported. Distributions are assumed, for
purposes of this calculation, to be reinvested at the net asset value per
share on the respective payment dates of each class.
* Annualized
Please see notes to financial statements for further information
accessor 74
<PAGE>
ACCESSOR FUNDS, INC.
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
INVESTOR(1)
ADVISOR CLASS CLASS
VALUE AND INCOME PORTFOLIO 1998 1997 1996 1995 1994 1998
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, beginning of period $ 20.88 $ 17.75 $ 15.91 $ 13.01 $ 13.58 $ 23.41
---------- ---------- ---------- ---------- ---------- -----------
Net investment income 0.24 0.26 0.24 0.33 0.25 0.05
Net realized and unrealized gain
(loss) on investments 2.45 5.54 3.51 3.96 (0.51) (0.31)
---------- ---------- ---------- ---------- ---------- -----------
Total from investment operations 2.69 5.80 3.75 4.29 (0.26) (0.26)
---------- ---------- ---------- ---------- ---------- -----------
Distributions from net investment
income (0.24) (0.26) (0.24) (0.33) (0.25) (0.06)
Distributions from capital gains (2.12) (2.41) (1.67) (1.06) (0.05) (1.90)
Distributions in excess of
capital gains (0.17) - - - (0.01) (0.15)
---------- ---------- ---------- ---------- ---------- -----------
Total distributions (2.53) (2.67) (1.91) (1.39) (0.31) (2.11)
---------- ---------- ---------- ---------- ---------- -----------
Net Asset Value, end of period $ 21.04 $ 20.88 $ 17.75 $ 15.91 $ 13.01 $ 21.04
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Total return (2) 12.89 % 32.94 % 23.94 % 33.25 % (1.93) % (1.09) %
---------- ---------- ---------- ---------- ---------- -----------
Net assets, end of period (in thousands) $ 114,728 $ 81,127 $ 36,367 $ 24,915 $ 19,999 $ 12,987
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Ratios of expenses to average net assets:
After Accessor Capital fee waivers 1.03 % 1.05 % 1.21 % 1.40 % 1.77 % 1.55 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Before Accessor Capital fee waivers 1.03 % 1.05 % 1.21 % 1.40 % 1.85 % 1.55 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Ratio of net investment income to
average net assets
After Accessor Capital fee waivers 1.06 % 1.32 % 1.43 % 2.18 % 2.00 % 0.44 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Before Accessor Capital fee waivers 1.06 % 1.32 % 1.43 % 2.18 % 1.92 % 0.44 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Portfolio turnover rate 104.85 % 68.14 % 93.54 % 100.88 % 54.26 % 104.85 %
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
</TABLE>
(1) Class commenced operations on July 01, 1998.
(2) Total return is calculated assuming a purchase of shares at net asset
value per share on the first day and a sale at net asset value per share
on the last day of each period reported. Distributions are assumed, for
purposes of this calculation, to be reinvested at the net asset value
per share on the respective payment dates of each class.
* Annualized
Please see notes to financial statements for further information
accessor 75
<PAGE>
ACCESSOR FUNDS, INC.
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
INVESTOR(1)
ADVISOR CLASS CLASS
SMALL TO MID CAP PORTFOLIO 1998 1997 1996 1995 1994 1998
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, beginning of period $ 21.82 $ 18.82 $ 17.60 $ 14.08 $ 14.79 $ 24.44
---------- ---------- ---------- ---------- ---------- -----------
Net investment income (loss) (0.05) - 0.07 0.06 (0.01) (0.09)
Net realized and unrealized gain
(loss) on investments 3.50 6.75 4.22 4.42 (0.59) 0.86
---------- ---------- ---------- ---------- ---------- -----------
Total from investment operations 3.45 6.75 4.29 4.48 (0.60) 0.77
---------- ---------- ---------- ---------- ---------- -----------
Distributions from net investment
income - - (0.07) (0.06) - -
Distributions from capital gains (1.74) (3.73) (3.00) (0.90) (0.10) (1.74)
Distribution in excess of net
investment income - (0.02) - - - -
Return of capital distributions - - - - (0.01) -
---------- ---------- ---------- ---------- ---------- -----------
Total distributions (1.74) (3.75) (3.07) (0.96) (0.11) (1.74)
---------- ---------- ---------- ---------- ---------- -----------
Net Asset Value, end of period $ 23.53 $ 21.82 $ 18.82 $ 17.60 $ 14.08 $ 23.47
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Total return (2) 15.98 % 36.14 % 24.85 % 31.98 % (4.07)% 3.32 %
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Net assets, end of period (in thousands) $ 260,792 $ 125,221 $ 65,479 $ 49,803 $ 24,148 $ 19,367
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Ratios of expenses to average net assets:
After Accessor Capital fee waivers 1.22 % 1.15 % 1.17 % 1.31 % 1.98 % 1.77 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Before Accessor Capital fee waivers 1.22 % 1.15 % 1.17 % 1.31 % 2.38 % 1.77 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Ratio of net investment income to average
net assets
After Accessor Capital fee waivers (0.22)% - % 0.37 % 0.41 % (0.18)% (0.84)%*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Before Accessor Capital fee waivers (0.22)% - % 0.37 % 0.41 % (0.58)% (0.84)%*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Portfolio turnover rate 110.07 % 129.98 % 113.44 % 84.26 % 30.14 % 110.07 %
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
</TABLE>
(1) Class commenced operations on June 24, 1998.
(2) Total return is calculated assuming a purchase of shares at net asset
value per share on the first day and a sale at net asset value per share
on the last day of each period reported. Distributions are assumed, for
purposes of this calculation, to be reinvested at the net asset value
per share on the respective payment dates of each class.
* Annualized
Please see notes to financial statements for further information
accessor 76
<PAGE>
ACCESSOR FUNDS, INC.
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
INVESTOR(2)
ADVISOR CLASS CLASS
INTERNATIONAL EQUITY PORTFOLIO 1998 1997 1996 1995 1994(1) 1998
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, beginning of period $ 14.83 $ 13.83 $ 12.55 $ 11.67 $ 12.00 $ 17.88
---------- ---------- ---------- ---------- ---------- -----------
Net investment income (loss) (0.03) (0.02) (0.06) 0.05 0.01 (0.06)
Net realized and unrealized gain
(loss) on investments 2.41 1.54 1.80 0.83 (0.34) (0.66)
---------- ---------- ---------- ---------- ---------- -----------
Total from investment operations 2.38 1.52 1.74 0.88 (0.33) (0.72)
---------- ---------- ---------- ---------- ---------- -----------
Distributions from capital gains (0.31) (0.50) (0.44) - - (0.31)
Distributions in excess of
capital gains - (0.02) (0.02) - - -
---------- ---------- ---------- ---------- ---------- -----------
Total distributions (0.31) (0.52) (0.46) - - (0.31)
---------- ---------- ---------- ---------- ---------- -----------
Net Asset Value, end of period $ 16.90 $ 14.83 $ 13.83 $ 12.55 $ 11.67 $ 16.85
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Total return (3) 16.07 % 10.96 % 13.78 % 7.63 % (2.75)% (4.01)%
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Net assets, end of period (in thousands) $ 149,391 $ 151,441 $ 73,019 $ 39,102 $ 7,566 $ 18,963
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Ratios of expenses to average net assets:
After Accessor Capital fee waivers 1.59 % 1.55 % 1.52 % 1.83 % 1.86 %* 2.05 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Before Accessor Capital fee waivers 1.59 % 1.55 % 1.52 % 1.93 % 4.06 %* 2.05 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Ratio of net investment income (loss) to
average net assets
After Accessor Capital fee waivers (0.24)% (0.20)% (0.26)% 0.10 % 0.38 %* (0.68)%*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Before Accessor Capital fee waivers (0.24)% (0.20)% (0.26)% - % (1.82)%* (0.68)%*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Portfolio turnover rate 196.37 % 196.66 % 157.66 % 84.85 % 0.82 % 196.37 %
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
</TABLE>
(1) For the period of October 3, 1994 (commencement of operations) through
December 31, 1994.
(2) Class commenced operations on July 06, 1998.
(3) Total return is calculated assuming a purchase of shares at net asset
value per share on the first day and a sale at net asset value per share
on the last day of each period reported. Distributions are assumed, for
purposes of this calculation, to be reinvested at the net asset value per
share on the respective payment dates of each class.
* Annualized.
Please see notes to financial statements for further information
accessor 77
<PAGE>
ACCESSOR FUNDS, INC.
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
INVESTOR(1)
ADVISOR CLASS CLASS
INTERMEDIATE FIXED-INCOME PORTFOLIO 1998 1997 1996 1995 1994 1998
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, beginning of period $ 12.19 $ 11.90 $ 12.29 $ 11.04 $ 12.34 $ 12.29
---------- ---------- ---------- ---------- ---------- -----------
Net investment income 0.67 0.71 0.67 0.71 0.65 0.28
Net realized and unrealized gain
(loss) on investments 0.32 0.29 (0.39) 1.25 (1.28) 0.24
---------- ---------- ---------- ---------- ---------- -----------
Total from investment operations 0.99 1.00 0.28 1.96 (0.63) 0.52
---------- ---------- ---------- ---------- ---------- -----------
Distributions from net investment
income (0.67) (0.71) (0.67) (0.71) (0.65) (0.30)
Distributions from capital gains (0.04) - - - (0.02) (0.04)
---------- ---------- ---------- ---------- ---------- -----------
Total distributions (0.71) (0.71) (0.67) (0.71) (0.67) (0.34)
---------- ---------- ---------- ---------- ---------- -----------
Net Asset Value, end of period $ 12.47 $ 12.19 $ 11.90 $ 12.29 $ 11.04 $ 12.47
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Total return (2) 8.38 % 8.62 % 2.56 % 18.26 % (5.24)% 4.29 %
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Net assets, end of period (in thousands) $ 48,489 $ 55,197 $ 52,248 $ 36,878 $ 31,405 $ 9,146
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Ratios of expenses to average net assets:
After Accessor Capital fee waivers 0.79 % 0.84 % 0.88 % 0.96 % 1.24 % 1.27 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Before Accessor Capital fee waivers 0.79 % 0.84 % 0.88 % 0.96 % 1.28 % 1.27 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Ratio of net investment income to average
net assets
After Accessor Capital fee waivers 5.46 % 5.88 % 5.79 % 6.07 % 5.65 % 4.75 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Before Accessor Capital fee waivers 5.46 % 5.88 % 5.79 % 6.07 % 5.61 % 4.75 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Portfolio turnover rate 113.00 % 84.35 % 94.69 % 187.62 % 255.11 % 113.00 %
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
</TABLE>
(1) Class commenced operations on July 14, 1998.
(2) Total return is calculated assuming a purchase of shares at net asset
value per share on the first day and a sale at net asset value per share
on the last day of each period reported. Distributions are assumed, for
purposes of this calculation, to be reinvested at the net asset value per
share on the respective payment dates of each class.
* Annualized
Please see notes to financial statements for further information
accessor 78
<PAGE>
ACCESSOR FUNDS, INC.
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
INVESTOR(1)
SHORT-INTERMEDIATE ADVISOR CLASS CLASS
FIXED-INCOME PORTFOLIO 1998 1997 1996 1995 1994 1998
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, beginning of period $ 12.27 $ 12.16 $ 12.32 $ 11.62 $ 12.29 $ 12.32
---------- ---------- ---------- ---------- ---------- -----------
Net investment income 0.68 0.64 0.59 0.60 0.50 0.27
Net realized and unrealized gain
(loss) on investments 0.14 0.11 (0.16) 0.70 (0.67) 0.17
---------- ---------- ---------- ---------- ---------- -----------
Total from investment operations 0.82 0.75 0.43 1.30 (0.17) 0.44
---------- ---------- ---------- ---------- ---------- -----------
Distributions from net investment
income (0.63) (0.64) (0.59) (0.60) (0.50) (0.30)
Distributions from capital gains (0.13) - - - - (0.13)
---------- ---------- ---------- ---------- ---------- -----------
Total distributions (0.76) (0.64) (0.59) (0.60) (0.50) (0.43)
---------- ---------- ---------- ---------- ---------- -----------
Net Asset Value, end of period $ 12.33 $ 12.27 $ 12.16 $ 12.32 $ 11.62 $ 12.33
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Total return (2) 6.87 % 6.33 % 3.63 % 11.42 % (1.42)% 3.55 %
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Net assets, end of period (in thousands) $ 42,454 $ 40,942 $ 36,701 $ 35,272 $ 32,233 $ 6,255
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Ratios of expenses to average net assets:
After Accessor Capital fee waivers 0.82 % 0.86 % 0.93 % 0.94 % 1.18 % 1.31 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Before Accessor Capital fee waivers 0.82 % 0.86 % 0.93 % 0.94 % 1.22 % 1.31 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Ratio of net investment income to average
net assets
After Accessor Capital fee waivers 5.12 % 5.20 % 4.89 % 4.99 % 4.17 % 4.57 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Before Accessor Capital fee waivers 5.12 % 5.20 % 4.89 % 4.99 % 4.13 % 4.57 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Portfolio turnover rate 69.64 % 53.30 % 31.12 % 41.93 % 36.54 % 69.64 %
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
</TABLE>
(1) Class commenced operations on July 14, 1998.
(2) Total return is calculated assuming a purchase of shares at net asset
value per share on the first day and a sale at net asset value per share
on the last day of each period reported. Distributions are assumed, for
purposes of this calculation, to be reinvested at the net asset value per
share on the respective payment dates of each class.
* Annualized
Please see notes to financial statements for further information
accessor 79
<PAGE>
ACCESSOR FUNDS, INC.
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
INVESTOR(1)
ADVISOR CLASS CLASS
MORTGAGE SECURITIES PORTFOLIO 1998 1997 1996 1995 1994 1998
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, beginning of period $ 12.60 $ 12.23 $ 12.38 $ 11.36 $ 12.17 $ 12.67
---------- ---------- ---------- ---------- ---------- -----------
Net investment income 0.70 0.72 0.73 0.76 0.60 0.31
Net realized and unrealized gain
(loss) on investments 0.09 0.42 (0.15) 1.02 (0.80) 0.01
---------- ---------- ---------- ---------- ---------- -----------
Total from investment operations 0.79 1.14 0.58 1.78 (0.20) 0.32
---------- ---------- ---------- ---------- ---------- -----------
Distributions from net investment
income (0.70) (0.72) (0.73) (0.76) (0.60) (0.33)
Distributions from capital gains (0.10) (0.05) - - (0.01) (0.07)
---------- ---------- ---------- ---------- ---------- -----------
Total distributions (0.80) (0.77) (0.73) (0.76) (0.61) (0.40)
---------- ---------- ---------- ---------- ---------- -----------
Net Asset Value, end of period $ 12.59 $ 12.60 $ 12.23 $ 12.38 $ 11.36 $ 12.59
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Total return (2) 6.43 % 9.53 % 4.95 % 16.03 % (1.65)% 2.46 %
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Net assets, end of period (in thousands) $ 128,788 $ 109,747 $ 73,862 $ 49,830 $ 32,975 $ 17,369
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Ratios of expenses to average net assets:
After Accessor Capital fee waivers 0.88 % 0.84 % 0.95 % 1.03 % 1.31 % 1.41 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Before Accessor Capital fee waivers 0.88 % 0.84 % 0.95 % 1.03 % 1.35 % 1.41 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Ratio of net investment income to average
net assets
After Accessor Capital fee waivers 5.59 % 5.93 % 6.08 % 6.41 % 5.18 % 5.09 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Before Accessor Capital fee waivers 5.59 % 5.93 % 6.08 % 6.41 % 5.14 % 5.09 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Portfolio turnover rate 278.18 % 211.66 % 356.23 % 422.56 % 603.51 % 278.18 %
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
</TABLE>
(1) Class commenced operations on July 10, 1998.
(2) Total return is calculated assuming a purchase of shares at net asset
value per share on the first day and a sale at net asset value per share
on the last day of each period reported. Distributions are assumed, for
purposes of this calculation, to be reinvested at the net asset value per
share on the respective payment dates of each class.
* Annualized
Please see notes to financial statements for further information
accessor 80
<PAGE>
ACCESSOR FUNDS, INC.
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
INVESTOR(1)
ADVISOR CLASS CLASS
U.S. GOVERNMENT MONEY PORTFOLIO 1998 1997 1996 1995 1994 1998
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ---------- -----------
Net investment income 0.05 0.05 0.05 0.05 0.04 0.02
---------- ---------- ---------- ---------- ---------- -----------
Distributions from net investment
income (0.05) (0.05) (0.05) (0.05) (0.04) (0.02)
---------- ---------- ---------- ---------- ---------- -----------
Net Asset Value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Total return (2) 5.00 % 5.07 % 4.78 % 5.33 % 3.70 % 1.83 %
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Net assets, end of period (in thousands) $ 153,148 $ 50,910 $ 61,672 $ 41,882 $ 12,008 $ 5,071
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Ratios of expenses to average net assets:
After Accessor Capital fee waivers 0.53 % 0.54 % 0.59 % 0.53 % 0.45 % 1.03 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Before Accessor Capital fee waivers 0.53 % 0.54 % 0.59 % 0.78 % 1.27 % 1.03 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Ratio of net investment income to average
net assets
After Accessor Capital fee waivers 4.83 % 4.96 % 4.73 % 5.14 % 3.51 % 4.40 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
Before Accessor Capital fee waivers 4.83 % 4.96 % 4.73 % 4.89 % 2.69 % 4.40 %*
---------- ---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- ---------- -----------
</TABLE>
(1) Class commenced operations on July 29, 1998.
(2) Total return is calculated assuming a purchase of shares at net asset
value per share on the first day and a sale at net asset value per share
on the last day of each period reported. Distributions are assumed, for
purposes of this calculation, to be reinvested at the net asset value per
share on the respective payment dates of each class.
Please see notes to financial statements for further information
accessor 81
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Shareholders and Board of Directors
Accessor Funds, Inc.
We have audited the accompanying statements of assets and liabilities, including
the schedules of investments, of Accessor Funds, Inc., including the Growth
Portfolio, Value and Income Portfolio, Small to Mid Cap Portfolio, International
Equity Portfolio, Intermediate Fixed-Income Portfolio, Short-Intermediate
Fixed-Income Portfolio, Mortgage Securities Portfolio, and U.S. Government Money
Portfolio (the "Funds"), as of December 31, 1998, the related statements of
operations for the year then ended, the statements of changes in net assets for
each of the years in the two year period then ended and the financial highlights
for the periods presented. These financial statements and financial highlights
are the responsibility of the Funds' management. Our responsibility is to
express an opinion on these financial statements and financial highlights based
on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned at December
31, 1998 by correspondence with the Funds' custodians and brokers. An audit also
includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of each of the Funds as
of December 31, 1998, the results of their operations, the changes in their net
assets and their financial highlights for the periods presented in conformity
with the generally accepted accounting principles.
DELOITTE & TOUCHE LLP
New York, New York
February 15, 1999
accessor 82
<PAGE>
TAX YEAR 1998
(UNAUDITED)
The following is provided for your information. Some states allow you to reduce
the amount of income you report on state income taxes by the proportion to which
such income was earned from investments in U.S. Government obligations. All
income shown is taxable for federal income tax purposes.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------
PERCENT OF INCOME FROM
PERCENT OF INCOME FROM OTHER U.S. GOVERNMENT
ACCESSOR PORTFOLIO NAME TREASURY OBLIGATIONS OBLIGATIONS
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Growth 0% 0%
Value and Income 1.11% 0%
Small to Mid Cap 0% 0%
International Equity 0% 0%
Intermediate Fixed-Income 27.51% 5.95%
Short-Intermediate Fixed-Income 61.92% 10.77%
Mortgage Securities 12.80% 83.52%
U.S. Government Money 1.40% 84.29%
</TABLE>
The following represents the percent of the income generated in the Accesor
Portfolios that are designated as qualifying dividends. This breakdown may
have tax benefits to certain corporate shareholders of the Accessor
Portfolios. Please consult your tax advisor.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------
ACCESSOR PORTFOLIO NAME PERCENT OF QUALIFYING DIVIDENDS
- --------------------------------------------------------------------------------------------------------------
<S> <C>
Growth 83.67%
Value and Income 72.48%
Small to Mid Cap 67.89%
International Equity 0%
Intermediate Fixed-Income 0%
Short-Intermediate Fixed-Income 0%
Mortgage Securities 0%
U.S. Government Money 0%
</TABLE>
accessor 83
<PAGE>
ACCESSOR FUNDS, INC.
DIRECTORS AND OFFICERS
George G. Cobean, III, Director
Geoffrey C. Cross, Director
J. Anthony Whatley, III, Director, President and Principal Executive Officer
Ravindra A. Deo, Treasurer, Vice President, Principal Financial and
Accounting Officer
Robert J. Harper, Vice President
Christine J. Stansbery, Secretary
Linda V. Whatley, Vice President
INVESTMENT ADVISOR AND ADMINISTRATOR
Accessor Capital Management L.P.
1420 Fifth Avenue, Suite 3600
Seattle, Washington 98101
CUSTODIAN
The Fifth Third Bank
Fifth Third Center
38 Fountain Square Plaza
Cincinnati, Ohio 45263
TRANSFER AGENT
Accessor Capital Management
P.O. Box 1748
Seattle, Washington 98111
LEGAL COUNSEL
Kirkpatrick & Lockhart
One International Place
13th Floor
Boston, Massachusetts 02110
INDEPENDENT AUDITORS
Deloitte & Touche LLP
Two World Financial Center
New York, New York 10281
This report, including the financial statements herein, is transmitted to the
shareholders of Accessor Funds, Inc. for their information. This is not a
prospectus, circular or representation intended for use in the purchase of
share of Accessor Funds, Inc., or any securities mentioned in this report.
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