THE WACHOVIA FUNDS
WACHOVIA EQUITY FUND
WACHOVIA QUANTITATIVE EQUITY FUND
WACHOVIA GROWTH AND INCOME FUND
WACHOVIA EQUITY INDEX FUND
WACHOVIA SPECIAL VALUES FUND
WACHOVIA EMERGING MARKETS FUND
WACHOVIA BALANCED FUND
WACHOVIA FIXED INCOME FUND
WACHOVIA INTERMEDIATE FIXED INCOME FUND
WACHOVIA SHORT-TERM FIXED INCOME FUND
THE WACHOVIA MUNICIPAL FUNDS
WACHOVIA GA MUNICIPAL BOND FUND
WACHOVIA NC MUNICIPAL BOND FUND
WACHOVIA SC MUNICIPAL BOND FUND
WACHOVIA VA MUNICIPAL BOND FUND
Combined Semi-Annual Report
May 31, 1999
[LOGO OF WACHOVIA FUNDS]
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
President's Message
Dear Shareholder:
I am pleased to present the combined Semi-Annual Report to Shareholders for The
Wachovia Funds and The Wachovia Municipal Funds. This report covers the
six-month period from December 1, 1998 through May 31, 1999, and includes a
complete listing of fund holdings and the funds' financial statements.+ The
following fund-by-fund highlights cover performance activity in Class A Shares,
Class B Shares, and Class Y Shares.
The Wachovia Funds
Wachovia Equity Fund pursues growth by focusing on stocks issued by companies
that are both undervalued and have good growth opportunities. At the end of the
reporting period, the fund's portfolio included blue-chip stocks issued by some
of America's largest, best-known companies such as American Express, AT&T, Black
& Decker, Coca-Cola, DuPont, General Electric, Intel, Merrill Lynch, Pfizer,
Time Warner, and Wal-Mart. Fund net assets reached $303.7 million at the end of
the reporting period.
<TABLE>
<CAPTION>
Total Return*
Based on NAV Income Capital Gains Share Price Change
------------- ------ ------------- ------------------
<S> <C> <C> <C> <C>
Class A Share 11.12% $0.05 $1.89 $15.91 to $15.60
Class B Shares 10.76% $0.00** $1.89 $15.87 to $15.55
Class Y Shares 11.26% $0.06 $1.89 $15.92 to $15.61
</TABLE>
Wachovia Quantitative Equity Fund pursues growth and income by investing in a
portfolio of stocks issued by large, established companies across the entire
industrial spectrum. On the last day of the reporting period, the fund's
portfolio included quality names like Anheuser-Busch, Exxon, General Electric,
GTE, Harley Davidson, IBM, Johnson & Johnson, PaineWebber, Procter & Gamble, and
Wal-Mart. Fund net assets reached $333.8 million at the end of the reporting
period.
<TABLE>
<CAPTION>
Total Return*
Based on NAV Income Capital Gains Share Price Change
------------- ------ ------------- ------------------
<S> <C> <C> <C> <C>
Class A Shares 8.22% $0.07 $0.74 $20.29 to $21.11
Class B Shares 7.94% $0.00** $0.74 $20.23 to $21.06
Class Y Shares 8.45% $0.10 $0.74 $20.31 to $21.15
</TABLE>
Wachovia Growth & Income Fund pursues total return through growth of capital and
income. At the end of the reporting period, the fund's holdings included such
names as AT&T, Bell Atlantic, Colgate-Palmolive, DuPont, General Electric,
General Motors, Merrill Lynch, PepsiCo, and Sears. Fund net assets ended the
reporting period at $329.1 million.
<TABLE>
<CAPTION>
Total Return*
Based on NAV Income Capital Gains Share Price Change
------------- ------ ------------- ------------------
<S> <C> <C> <C> <C>
Class A Shares 9.63% $0.06 $2.89 $23.54 to $22.66
Class Y Shares 9.76% $0.08 $2.89 $23.55 to $22.67
</TABLE>
Wachovia Equity Index Fund pursues a total return that approximates that of the
Standard & Poor's 500 Index--a classic benchmark of stock market performance.***
As a result, the fund's extensive portfolio contained stocks issued across the
entire spectrum of American business and industry. Fund net assets reached
$506.5 million at the end of the reporting period.
<TABLE>
<CAPTION>
Total Return*
Based on NAV Income Capital Gains Share Price Change
------------- ------ ------------- ------------------
<S> <C> <C> <C> <C>
Class A Shares 12.12% $0.13 $0.37 $22.41 to $24.59
Class Y Shares 12.28% $0.16 $0.37 $22.44 to $24.63
</TABLE>
+ The composition and holdings of the funds are subject to change. Past
performance is no guarantee of future results.
* Performance quoted represents past performance and is not indicative of
future results. Investment return and principal value will fluctuate, so
that an investor's shares, when redeemed, may be worth more or less than
their original cost.
** Less than $0.01 per share.
*** The Standard & Poor's 500 Index is an unmanaged index comprised of common
stocks in industry, transportation, and financial and public utility
companies. Investments cannot be made in an index.
Wachovia Special Values Fund pursues growth by investing in a diversified
portfolio of small-company stocks.* Unlike many other funds that invest in
small-company stocks through a high-flying approach, this fund is managed
through a highly disciplined approach. Its manager seeks stocks issued by
well-capitalized, and well-run small companies that are selling at less than
their estimated long-term values. Fund net assets reached $169.1 million at the
end of the reporting period.
<TABLE>
<CAPTION>
Total Return**
Based on NAV Income Capital Gains Share Price Change
-------------- ------ ------------- ------------------
<S> <C> <C> <C> <C>
Class A Shares 6.79% $0.16 $0.75 $16.13 to $16.24
Class B Shares (period
from March 26, 1999
through May 31, 1999) 11.37% -- -- $14.60 to $16.26
Class Y Shares 6.86% $0.20 $0.75 $16.18 to $16.26
</TABLE>
Wachovia Emerging Markets Fund pursues growth over the long term by investing in
stocks of foreign companies located in emerging market countries.*** The fund's
managers uses a unique "two-tier, equal weighting" approach to selecting stocks
for the fund that offers greater diversification than most emerging market
funds, with the opportunity for better protection from unexpected negative
developments in any one country. At the end of the reporting period, the fund's
portfolio contained stocks issued by companies from 33 countries. Fund net
assets reached $169.4 million at the end of the reporting period.
<TABLE>
<CAPTION>
Total Return**
Based on NAV Income Share Price Change
-------------- ------ ------------------
<S> <C> <C> <C>
Class A Shares 19.90% $0.05 $8.43 to $10.05
Class Y Shares 20.08% $0.07 $8.44 to $10.05
</TABLE>
Wachovia Balanced Fund pursues a popular investment objective--long-term growth
and current income--by investing in a quality combination of stocks and bonds.
Fund net assets ended the reporting period at $384.3 million.
<TABLE>
<CAPTION>
Total Return**
Based on NAV Income Capital Gains Share Price Change
-------------- ------ ------------- ------------------
<S> <C> <C> <C> <C>
Class A Shares 5.98% $0.16 $1.26 $13.72 to $13.07
Class B Shares 5.54% $0.11 $1.26 $13.69 to $13.03
Class Y Shares 6.10% $0.18 $1.26 $13.74 to $13.09
</TABLE>
Wachovia Fixed Income Fund pursues a high level of total return from a
diversified portfolio of income-producing securities. At the end of the
reporting period, the fund's $284.1 million in net assets were invested across
government agency securities (37.9%), corporate bonds (27.1%), U.S. Treasury
securities (12.6%), closed-end investment companies (7.1%), a repurchase
agreement (5.4%), asset-backed securities (6.8%) collateralized mortgage
obligations (3.1%), and foreign bonds (0.7%).
<TABLE>
<CAPTION>
Total Return**
Based on NAV Income Capital Gains Share Price Change
-------------- ------ ------------- ------------------
<S> <C> <C> <C> <C>
Class A Shares (1.02%) $0.25 $0.04 $10.14 to $9.75
Class B Shares (1.38%) $0.22 $0.04 $10.14 to $9.75
Class Y Shares (0.90%) $0.27 $0.04 $10.14 to $9.75
</TABLE>
Wachovia Intermediate Fixed Income Fund pursues current income consistent with
preservation of capital from a diversified portfolio of intermediate-term,
income-producing securities. At the end of the reporting period, the fund's
$83.3 million in net assets were invested across government agency securities
(37.5%), corporate bonds (34.8%), U.S. Treasury securities (11.8%), asset-
backed securities (10.1%), closed-end investment companies (6.3%), a repurchase
agreement (0.4%) and collateralized mortgage obligations (0.4%).
<TABLE>
<CAPTION>
Total Return**
Based on NAV Income Capital Gains Share Price Change
-------------- ------ ------------- ------------------
<S> <C> <C> <C> <C>
Class A Shares (1.28%) $0.25 $0.20 $10.38 to $9.80
Class Y Shares (1.14%) $0.27 $0.20 $10.38 to $9.80
</TABLE>
* Small-company stocks have historically experienced greater volatility than
average.
** Performance quoted represents past performance and is not indicative of
future results. Investment return and principal value will fluctuate, so
that an investor's shares, when redeemed, may be worth more or less than
their original cost.
*** Foreign investing involves special risks including currency risk, increased
volatility of foreign securities, and differences in auditing and other
financial standards. Emerging markets economic structures may be less
diverse and mature, and their political systems may be less stable than
those of established markets.
Wachovia Short-Term Fixed Income Fund pursues a high level of income from a
diversified portfolio that, at the end of the reporting period, consisted
primarily of corporate bonds (45.2%), U.S. government agency obligations
(27.8%), U.S. Treasury obligations (17.6%), closed-end investment companies
(4.4%), asset-backed securities (2.3%) and a repurchase agreement (1.5%). These
short-term, income-producing securities are managed to provide an income stream
and cushion shareholders against volatility during periods of interest rate
increases. Fund net assets ended the reporting period at $44.2 million.
<TABLE>
<CAPTION>
Total Return*
Based on NAV Income Share Price Change
------------- ------ ------------------
<S> <C> <C> <C>
Class A Shares 0.75% $0.28 $9.92 to $9.71
Class Y Shares 0.88% $0.30 $9.92 to $9.71
</TABLE>
The Wachovia Municipal Funds
Wachovia Georgia Municipal Bond Fund pursues monthly income exempt from federal
regular income tax and Georgia state income tax.** The fund invests in a
portfolio of bonds issued by municipalities across Georgia that are rated A or
higher by nationally recognized rating agencies. Fund net assets reached $26.8
million at the end of the reporting period.
<TABLE>
<CAPTION>
Total Return*
Based on NAV Income Capital Gain Share Price Change
------------- ------ ------------ ------------------
<S> <C> <C> <C> <C>
Class A Shares (0.15%) $0.21 $0.03 $11.38 to $11.13
Class Y Shares (0.02%) $0.22 $0.03 $11.38 to $11.13
</TABLE>
Wachovia North Carolina Municipal Bond Fund pursues monthly income exempt from
federal regular income tax and North Carolina state income tax.** At the end of
the reporting period, the fund's $79.2 million in net assets were invested in 93
bonds issued by municipalities across North Carolina. All holdings are rated A
or higher at the time of purchase by nationally recognized rating agencies.
<TABLE>
<CAPTION>
Total Return*
Based on NAV Income Capital Gains Share Price Change
------------- ------ ------------- ------------------
<S> <C> <C> <C> <C>
Class A Shares (0.14%) $0.21 $0.06 $11.46 to $11.18
Class Y Shares (0.02%) $0.22 $0.06 $11.46 to $11.18
</TABLE>
Wachovia South Carolina Municipal Bond Fund pursues monthly income exempt from
federal regular income tax and South Carolina state income tax.** The fund
invests in a portfolio of bonds issued by South Carolina municipalities that are
rated A or higher by nationally recognized rating agencies at the time of
purchase. Fund net assets reached $131.3 million at the end of the reporting
period.
<TABLE>
<CAPTION>
Total Return*
Based on NAV Income Capital Gains Share Price Change
------------- ------ ------------- ------------------
<S> <C> <C> <C> <C>
Class A Shares 0.06% $0.25 $0.02 $11.36 to $11.10
Class Y Shares 0.19% $0.26 $0.02 $11.36 to $11.10
</TABLE>
Wachovia Virginia Municipal Bond Fund pursues monthly income exempt from federal
regular income tax and Virginia state income tax.** The fund invests in a
portfolio of bonds issued by Virginia municipalities that are rated A or higher
by nationally recognized rating agencies at the time of purchase. Fund net
assets ended the reporting period at $104.3 million.
<TABLE>
<CAPTION>
Total Return*
Based on NAV Income Share Share Price Change
------------- ------------ ------------------
<S> <C> <C> <C>
Class A Shares 0.31% $0.22 $10.49 to $10.30
Class Y Shares 0.43% $0.24 $10.49 to $10.30
</TABLE>
* Performance quoted represents past performance and is not indicative of
future results. Investment return and principal value will fluctuate, so
that an investor's shares, when redeemed, may be worth more or less than
their original cost.
** Income may be subject to the federal alternative minimum tax.
Thank you for pursuing your financial goals through one or more of the Wachovia
Funds and the Wachovia Municipal Funds. We look forward to keeping you
up-to-date on your investment progress.
Sincerely,
/s/ John W. McGonigle
John W. McGonigle
President
July 15, 1999
Total returns for the period adjusted for the maximum sales charge or deferred
sales charge are as follows:
Wachovia Equity Fund, Class A Shares, 6.12%; Class B Shares, 5.86% Wachovia
Quantitative Equity Fund, Class A Shares, 3.34%; Class B Shares, 2.94% Wachovia
Growth and Income Fund, Class A Shares, 4.70% Wachovia Equity Index Fund, Class
A Shares, 7.05% Wachovia Special Values Fund, Class A Shares, 1.98%; Class B
Shares, 6.37% Wachovia Emerging Markets Fund, Class A Shares, 14.47% Wachovia
Balanced Fund, Class A Shares, 1.18%; Class B Shares, 0.78% Wachovia Fixed
Income Fund, Class A Shares, (5.49%); Class B Shares, (6.19%) Wachovia
Intermediate Fixed Income Fund, Class A Shares, (5.73%) Wachovia Short-Term
Fixed Income Fund, Class A Shares, (1.73%) Wachovia Georgia Municipal Bond Fund,
Class A Shares, (4.67%) Wachovia North Carolina Municipal Bond Fund, Class A
Shares, (4.64%) Wachovia South Carolina Municipal Bond Fund, Class A Shares,
(4.48%) Wachovia Virginia Municipal Bond Fund, Class A Shares, (4.17%)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Equity Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Shares Value
- ----------------------------------------------------------------------------
<C> <S> <C>
Common Stocks--86.1%
Basic Materials--4.1%
34,171 Air Products & Chemicals, Inc. $ 1,401,011
56,496 Du Pont (E.I.) de Nemours & Co. 3,696,957
18,460 Potash Corporation of Saskatchewan, Inc. 1,003,763
67,173 Rohm & Haas Co. 2,695,317
58,251 Weyerhaeuser Co. 3,615,203
------------
Total 12,412,251
------------
Capital Goods--6.5%
65,974 General Electric Co. 6,708,731
38,388 Ingersoll-Rand Co. 2,444,836
59,930 Tyco International Ltd. 5,236,384
64,344 United Technologies Corp. 3,993,350
27,161 Waste Management, Inc. 1,436,138
------------
Total 19,819,439
------------
Communication Services--6.3%
98,538 AT&T Corp. 5,468,859
16,100 (1)Airtouch Communications, Inc. 1,618,050
109,312 (1)MCI Worldcom, Inc. 9,441,824
65,138 (1)Qwest Communications International, Inc. 2,764,294
------------
Total 19,293,027
------------
Consumer Cyclical--5.5%
40,783 Black & Decker Corp. 2,322,082
17,550 Carnival Corp. 719,550
41,465 Lowe's Cos., Inc. 2,153,588
18,019 Magna International, Inc., Class A 1,091,276
60,319 McGraw-Hill Cos., Inc. 3,129,048
55,235 Nordstrom, Inc. 1,960,843
22,544 Tandy Corp. 1,859,880
81,405 Wal-Mart Stores, Inc. 3,469,888
------------
Total 16,706,155
------------
Consumer Staples--10.7%
15,561 (1)AT&T Corp.-Liberty Media Group, Inc., Class A 1,033,834
30,339 Avon Products, Inc. 1,499,884
66,938 CBS Corp. 2,794,662
43,136 CVS Corp. 1,984,256
39,053 (1)Clear Channel Communications, Inc. 2,579,939
46,469 Coca Cola Enterprises, Inc. 1,684,501
80,922 Comcast Corp., Class A 3,115,497
</TABLE>
<TABLE>
<CAPTION>
Shares Value
- ------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Consumer Staples--continued
52,015 (1)Kroger Co., Inc. $ 3,046,128
39,376 (1)Outback Steakhouse, Inc. 1,412,614
49,902 PepsiCo, Inc. 1,787,115
43,417 Procter & Gamble Co. 4,054,062
45,924 (1)Safeway, Inc. 2,135,466
78,352 Time Warner, Inc. 5,332,833
------------
Total 32,460,791
------------
Energy--4.6%
17,584 BP Amoco PLC, ADR 1,883,686
26,568 Chevron Corp. 2,462,522
66,696 Conoco, Inc., Class A 1,809,129
78,926 Exxon Corp. 6,304,214
25,954 Schlumberger Ltd. 1,562,106
------------
Total 14,021,657
------------
Finance--16.6%
43,382 American Express Co. 5,257,356
15,551 American General Corp. 1,123,560
47,263 American International Group, Inc. 5,402,752
32,286 Associates First Capital Corp., Class A 1,323,726
47,202 Bank One Corp. 2,669,863
72,231 Bank of America Corp. 4,672,443
30,577 Bank of New York Co., Inc. 1,093,128
44,917 Chase Manhattan Corp. 3,256,483
110,473 Citigroup, Inc. 7,318,836
27,092 Fannie Mae 1,842,256
55,522 Freddie Mac 3,237,627
27,772 First Union Corp. 1,279,248
27,747 MBIA, Inc. 1,895,467
55,897 MBNA Corp. 1,544,155
19,138 Marsh & McLennan Cos., Inc. 1,392,290
14,472 Merrill Lynch & Co., Inc. 1,215,648
37,942 SunTrust Banks, Inc. 2,561,085
82,463 Wells Fargo Co. 3,298,520
------------
Total 50,384,443
------------
Healthcare--10.1%
52,561 Abbott Laboratories 2,375,100
56,088 American Home Products Corp. 3,232,071
57,247 Bristol-Myers Squibb Co. 3,928,575
7,988 (1)Elan Corp. PLC, ADR 431,352
33,160 Johnson & Johnson 3,071,445
39,649 Lilly (Eli) & Co. 2,832,425
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Equity Fund
<TABLE>
<CAPTION>
Shares Value
- -----------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Healthcare--continued
13,872 Medtronic, Inc. $ 984,912
59,004 Merck & Co., Inc. 3,982,770
40,961 Pfizer, Inc. 4,382,827
40,370 Pharmacia & Upjohn, Inc. 2,238,012
27,678 Schering Plough Corp. 1,247,240
30,202 Warner-Lambert Co. 1,872,524
------------
Total 30,579,253
------------
Technology--18.6%
35,088 (1)America Online, Inc. 4,188,630
21,307 (1)Applied Materials, Inc. 1,170,553
25,932 (1)Ascend Communications, Inc. 2,403,572
63,115 (1)Cisco Systems, Inc. 6,879,630
30,122 (1)Dell Computer Corp. 1,037,326
32,216 (1)EMC Corp. 3,209,519
87,220 Intel Corp. 4,715,331
53,996 International Business Machines Corp. 6,280,410
28,748 Lucent Technologies, Inc. 1,635,043
123,227 (1)Microsoft Corp. 9,942,879
22,292 Nokia Oyj, Class A, ADR 1,582,732
70,233 (1)Sun Microsystems, Inc. 4,196,422
36,231 Texas Instruments, Inc. 3,962,766
17,558 (1)Uniphase Corp. 2,352,772
31,807 (1)Veritas Software Corp. 2,806,968
------------
Total 56,364,553
------------
</TABLE>
<TABLE>
<CAPTION>
Shares or
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Transportation--1.3%
72,666 Burlington Northern Santa Fe $ 2,252,646
56,177 Southwest Airlines Co. 1,801,175
------------
Total 4,053,821
------------
Utilities--1.8%
22,633 Duke Energy Corp. 1,365,053
36,039 Enron Corp. 2,572,284
51,952 Southern Co. 1,474,133
------------
Total 5,411,470
------------
Total Common Stocks
(identified cost $198,905,298) 261,506,860
------------
U.S. Government Agency--6.5%
$20,000,000 (2)Federal Home Loan Mortgage Corp., Discount Bond,
9/9/1999 (identified cost $19,732,778) 19,733,400
------------
U.S. Treasury Obligation--1.2%
3,500,000 (2)United States Treasury Bill, 6/17/1999
(identified cost $3,493,082) 3,493,000
------------
(3) Repurchase Agreement--6.5%
19,779,054 Goldman Sachs Group, LP, 4.50%, dated 5/28/1999,
due 6/1/1999 (at amortized cost) 19,779,054
------------
Total Investments
(identified cost $241,910,212) $304,512,314
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Quantitative Equity Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Shares Value
- -----------------------------------------------------------
<C> <S> <C>
Common Stocks--89.0%
Basic Materials--3.1%
40,000 Cyprus Amax Minerals $ 502,500
10,000 Du Pont (E.I.) de Nemours & Co. 654,375
110,000 Ecolab, Inc. 4,675,000
7,000 (1)FMC Corp. 463,313
10,000 Georgia-Pacific Corp. 864,375
20,000 Sigma-Aldrich Corp. 640,000
40,000 Weyerhaeuser Co. 2,482,500
------------
Total 10,282,063
------------
Capital Goods--7.2%
10,000 Ball Corp. 486,875
95,000 Corning, Inc. 5,189,375
63,000 General Electric Co. 6,406,313
65,000 Ingersoll-Rand Co. 4,139,688
30,000 Rockwell International Corp. 1,655,625
60,000 Tyco International Ltd. 5,242,500
14,000 United Technologies Corp. 868,875
------------
Total 23,989,251
------------
Communication Services--7.6%
92,000 Ameritech Corp. 6,054,750
75,000 Bell Atlantic Corp. 4,106,250
120,000 BellSouth Corp. 5,662,500
50,000 GTE Corp. 3,153,125
72,000 SBC Communications, Inc. 3,681,000
50,000 U.S. West, Inc. 2,703,125
------------
Total 25,360,750
------------
Consumer Cyclical--8.2%
60,000 Arvin Industries, Inc. 2,355,000
40,000 (1)Best Buy Co., Inc. 1,820,000
30,000 Carnival Corp. 1,230,000
40,000 Dayton-Hudson Corp. 2,520,000
20,000 Ennis Business Forms, Inc. 172,500
25,000 Gannett Co., Inc. 1,806,250
45,000 Knight-Ridder, Inc. 2,370,938
40,000 Leggett and Platt, Inc. 1,055,000
40,000 Maytag Corp. 2,822,500
80,000 (1)Sybron International Corp. 2,010,000
100,000 TJX Cos., Inc. 3,000,000
55,000 Times Mirror Co., Class A 3,241,563
70,000 Wal-Mart Stores, Inc. 2,983,750
------------
Total 27,387,501
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
- ---------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Consumer Staples--11.8%
40,000 American Stores Co. $ 1,320,000
50,000 Anheuser-Busch Cos., Inc. 3,653,125
70,000 Bergen Brunswig Corp., Class A 1,540,000
60,000 Fortune Brands, Inc. 2,452,500
10,000 Harley Davidson, Inc. 510,625
50,000 Heinz (H.J.) Co. 2,415,625
140,000 IBP, Inc. 3,001,250
120,000 (1)King World Productions, Inc. 4,005,000
75,000 PepsiCo, Inc. 2,685,938
60,000 Philip Morris Cos., Inc. 2,313,750
70,000 Premark International, Inc. 2,506,875
40,000 Procter & Gamble Co. 3,735,000
40,000 Quaker Oats Co. 2,642,500
70,000 (1)Safeway, Inc. 3,255,000
100,000 SUPERVALU Inc. 2,425,000
35,000 SYSCO Corp. 1,039,063
------------
Total 39,501,251
------------
Energy--3.9%
20,000 Chevron Corp. 1,853,750
43,000 Exxon Corp. 3,434,625
48,000 Mobil Corp. 4,860,000
40,000 Royal Dutch Petroleum Co., ADR 2,262,500
35,000 Union Pacific Resources Group, Inc. 487,813
------------
Total 12,898,688
------------
Finance--14.4%
24,000 AEGON NV, ADR 1,947,000
30,000 Allstate Corp. 1,093,125
95,000 Ambac Financial Group, Inc. 5,539,688
40,000 American General Corp. 2,890,000
135,000 Amsouth Bancorporation 3,830,625
70,000 Chase Manhattan Corp. 5,075,000
60,000 Citigroup, Inc. 3,975,000
75,000 Freddie Mac 4,373,438
20,000 J.P. Morgan & Co., Inc. 2,786,250
25,000 Lincoln National Corp. 2,543,750
40,000 Marsh & McLennan Cos., Inc. 2,910,000
40,000 PaineWebber Group, Inc. 1,880,000
65,000 PNC Bank Corp. 3,721,250
50,000 Reliastar Financial Corp. 2,078,125
91,500 SouthTrust Corp. 3,562,781
------------
Total 48,206,032
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Quantitative Equity Fund
<TABLE>
<CAPTION>
Shares Value
- -------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Healthcare--9.4%
75,000 Abbott Laboratories $ 3,389,063
30,000 (1)Amgen, Inc. 1,897,500
70,000 (1)Boston Scientific Corp. 2,655,625
80,000 Bristol-Myers Squibb Co. 5,490,000
100,000 Guidant Corp. 5,000,000
25,000 Johnson & Johnson 2,315,625
20,000 Lilly (Eli) & Co. 1,428,750
38,000 Merck & Co., Inc. 2,565,000
120,000 Schering Plough Corp. 5,407,500
20,000 Warner-Lambert Co. 1,240,000
------------
Total 31,389,063
------------
Technology--18.0%
25,000 (1)Apple Computer, Inc. 1,101,563
75,000 (1)Ascend Communications 6,951,563
50,000 (1)Cisco Systems, Inc. 5,450,000
130,000 Comdisco, Inc. 3,168,750
50,000 Compaq Computer Corp. 1,184,375
80,000 Computer Associates International, Inc. 3,785,000
34,000 (1)EMC Corp. 3,387,250
60,000 Intel Corp. 3,243,750
60,000 International Business Machines Corp. 6,978,750
65,000 (1)Lexmark International Group, Class A 8,848,125
80,000 Lucent Technologies, Inc. 4,550,000
50,000 (1)Microsoft Corp. 4,034,375
85,000 (1)Sun Microsystems, Inc. 5,078,750
40,000 Xerox Corp. 2,247,500
------------
Total 60,009,751
------------
</TABLE>
<TABLE>
<CAPTION>
Shares or
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Transportation--1.0%
55,000 GATX Corp. $ 2,134,688
20,000 Union Pacific Corp. 1,141,250
------------
Total 3,275,938
------------
Utilities--4.4%
150,000 Coastal Corp. 5,784,375
60,000 DQE, Inc. 2,565,000
30,000 Enron Corp. 2,141,250
45,000 GPU, Inc. 1,960,313
45,000 Williams Cos., Inc. (The) 2,331,555
------------
Total 14,782,493
------------
Total Common Stocks
(identified cost $190,214,189) 297,082,781
------------
U.S. Government Agency--3.0%
$10,000,000 (2)Federal Home Loan Mortgage Corp., Discount Bond,
9/9/1999 (identified cost $9,866,389) 9,866,700
------------
U.S. Treasury Obligation--0.7%
2,500,000 (2)United States Treasury Bill, 6/17/1999
(identified cost $2,495,011) 2,495,000
------------
(3) Repurchase Agreement--7.0%
23,465,655 Goldman Sachs Group, LP, 4.50%, dated 5/28/1999,
due 6/1/1999 (at amortized cost) 23,465,655
------------
Total Investments
(identified cost $226,041,244) $332,910,136
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Growth & Income Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Shares Value
- --------------------------------------------------------------
<C> <S> <C>
Common Stocks--92.2%
Basic Materials--4.5%
53,094 Air Products & Chemicals, Inc. $ 2,176,854
110,405 Du Pont (E.I.) de Nemours & Co. 7,224,627
87,226 Weyerhaeuser Co. 5,413,464
------------
Total 14,814,945
------------
Capital Goods--7.0%
36,466 Allied-Signal, Inc. 2,117,307
76,211 General Electric Co. 7,749,706
79,346 Tyco International Ltd. 6,932,857
103,440 United Technologies Corp. 6,419,745
------------
Total 23,219,615
------------
Communication Services--6.2%
50,820 AT&T Corp. 2,820,510
75,000 Alltel Corp. 5,376,563
60,000 Bell Atlantic Corp. 3,285,000
102,905 (1)MCI Worldcom, Inc. 8,888,419
------------
Total 20,370,492
------------
Consumer Cyclical--6.8%
834 Black & Decker Corp. 47,486
58,733 (1)Delphi Automotive Systems Corp. 1,152,635
84,033 General Motors Corp. 5,798,277
64,269 Goodyear Tire & Rubber Co. 3,836,056
755 Magna International, Inc.,
Class A 45,725
1,168 McGraw-Hill Cos., Inc. 60,590
75,000 Sears, Roebuck & Co. 3,585,937
104,141 (1)Tommy Hilfiger Corp. 7,817,084
1,234 Wal-Mart Stores, Inc. 52,599
------------
Total 22,396,389
------------
Consumer Staples--10.4%
31,102 Anheuser-Busch Cos., Inc. 2,272,390
50,193 Avon Products, Inc. 2,481,416
895 CBS Corp. 37,366
64,352 Campbell Soup Co. 2,839,532
47,197 (1)Clear Channel
Communications, Inc. 3,117,952
53,255 Colgate-Palmolive Co. 5,318,843
44,176 Comcast Corp., Class A 1,700,776
141,100 PepsiCo, Inc. 5,053,144
70,834 Procter & Gamble Co. 6,614,125
40,944 (1)Safeway, Inc. 1,903,896
</TABLE>
<TABLE>
<CAPTION>
Shares Value
- --------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Consumer Staples--continued
40,094 Time Warner, Inc. $ 2,728,898
------------
Total 34,068,338
------------
Energy--5.5%
61,899 Chevron Corp. 5,737,382
108,026 Exxon Corp. 8,628,576
62,366 Schlumberger Ltd. 3,753,654
------------
Total 18,119,612
------------
Finance--18.3%
25,878 American Express Co. 3,136,090
242 American General Corp. 17,484
29,660 American International Group, Inc. 3,390,509
772 Bank One Corp. 43,666
883 Bank of America Corp. 57,119
124,000 Bank of New York Co., Inc. 4,433,000
831 Chase Manhattan Corp. 60,248
136,421 Citigroup, Inc. 9,037,891
185,714 Freddie Mac 10,829,448
155,000 Franklin Resources, Inc. 6,742,500
493 MBIA, Inc. 33,678
298 Marsh & McLennan Cos., Inc. 21,679
30,400 Merrill Lynch & Co., Inc. 2,553,600
120,432 Morgan Stanley,
Dean Witter & Co. 11,621,688
30,000 Progressive Corp., 4,211,250
680 SunTrust Banks, Inc. 45,900
100,000 Wells Fargo Co. 4,000,000
------------
Total 60,235,750
------------
Healthcare--10.7%
153,703 Abbott Laboratories 6,945,454
30,086 American Home Products Corp. 1,733,706
1,272 Bristol-Myers Squibb Co. 87,291
259 (1)Elan Corp. PLC, ADR 13,986
75,489 Johnson & Johnson 6,992,169
602 Lilly (Eli) & Co. 43,005
114,632 Merck & Co., Inc. 7,737,660
15,929 Pfizer, Inc. 1,704,403
220,944 Schering Plough Corp. 9,956,289
------------
Total 35,213,963
------------
Technology--19.5%
24,549 (1)America Online, Inc. 2,930,537
67,794 (1)Cisco Systems, Inc. 7,389,601
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Growth & Income Fund
<TABLE>
<CAPTION>
Shares Value
- --------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Technology--continued
50,335 (1)EMC Corp. $ 5,014,624
162,556 Intel Corp. 8,788,184
75,934 International Business
Machines Corp. 8,832,073
96,300 Lucent Technologies, Inc. 5,477,062
77,440 (1)Microsoft Corp. 6,248,440
57,400 Nokia Oyj, Class A, ADR 4,075,400
166,198 (1)Sun Microsystems, Inc. 9,930,330
50,872 Texas Instruments, Inc. 5,564,125
------------
Total 64,250,376
------------
Transportation--1.4%
146,433 Burlington Northern Santa Fe 4,539,423
------------
Utilities--1.9%
55,506 Duke Energy Corp. 3,347,706
646 Enron Corp. 46,108
34,947 FPL Group, Inc. 2,033,479
16,696 GPU, Inc. 727,319
</TABLE>
<TABLE>
<CAPTION>
Shares or
Principal
Amount Value
- ------------------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Utilities--continued
1,887 Southern Co. $ 53,544
------------
Total 6,208,156
------------
Total Common Stocks (identified cost $161,184,010) 303,437,059
------------
U.S. Government Agency--3.0%
Finance--3.0%
$10,000,000 Federal Home Loan Mortgage Corp., Discount Bond,
9/8/1999 (identified cost $9,867,725) 9,866,900
------------
U.S. Treasury Obligation--0.7%
2,250,000 (2)United States Treasury Bill, 6/17/1999
(identified cost $2,245,609) 2,245,500
------------
(3) Repurchase Agreement--4.0%
13,102,984 Goldman Sachs Group, LP, 4.50%, dated 5/28/1999,
due 6/1/1999 (at amortized cost) 13,102,984
------------
Total Investments (identified cost $186,400,328) $328,652,443
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Equity Index Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Shares Value
- ------------------------------------------------------------------------
<C> <S> <C>
Common Stocks--88.3%
Basic Materials--2.9%
1,666 ASARCO, Inc. $ 26,760
9,722 Air Products & Chemicals, Inc. 398,602
9,562 Alcan Aluminum, Ltd. 267,736
15,422 Alcoa, Inc. 848,210
8,241 Allegheny Teledyne, Inc. 168,425
1,681 Armstrong World Industries, Inc. 97,918
15,669 Barrick Gold Corp. 270,290
9,654 Battle Mountain Gold Co. 23,532
2,200 Bemis Co., Inc. 83,050
5,460 (1)Bethlehem Steel Corp. 45,386
2,366 Boise Cascade Corp. 93,753
4,015 Champion International Corp. 205,769
3,820 Cyprus Amax Minerals 47,989
9,298 Dow Chemical Co. 1,129,707
47,294 Du Pont (E.I.) de Nemours & Co. 3,094,801
3,329 Eastman Chemical Co. 168,531
5,435 Ecolab, Inc. 230,988
5,317 Engelhard Corp. 107,669
1,390 (1)FMC Corp. 92,001
6,954 Freeport-McMoRan Copper & Gold, Inc., Class B 98,225
3,696 Georgia-Pacific Corp. 319,473
3,123 Goodrich (B.F.) Co. 126,482
3,088 (1)Grace (W.R.) & Co. 55,005
2,483 Great Lakes Chemical Corp. 112,201
4,225 Hercules, Inc. 147,611
10,041 Homestake Mining Co. 78,445
6,976 Inco Ltd. 99,408
4,457 International Flavors & Fragrances, Inc. 183,294
17,224 International Paper Co. 861,250
4,565 Louisiana-Pacific Corp. 92,441
4,316 Mead Corp. 161,311
26,317 Monsanto Co. 1,092,156
5,097 Morton International, Inc. 198,783
2,751 Nalco Chemical Co. 92,159
7,024 Newmont Mining Corp. 125,115
3,679 Nucor Corp. 183,720
7,443 PPG Industries, Inc. 451,697
2,434 Phelps Dodge Corp. 126,112
10,148 Pioneer Hi-Bred International, Inc. 380,550
13,753 Placer Dome, Inc. 153,002
1,219 Potlatch Corp. 47,998
6,627 Praxair, Inc. 323,480
2,708 Reynolds Metals Co. 144,032
6,993 Rohm & Haas Co. 280,594
</TABLE>
<TABLE>
<CAPTION>
Shares Value
- ---------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Basic Materials--continued
4,227 Sigma-Aldrich Corp. $ 135,264
2,336 Temple-Inland, Inc. 156,512
3,711 USX-U.S. Steel Group, Inc. 99,965
5,582 Union Carbide Corp. 286,426
4,252 Westvaco Corp. 121,448
8,359 Weyerhaeuser Co. 518,780
4,661 Willamette Industries, Inc. 197,510
3,884 Worthington Industries, Inc. 49,764
------------
Total 14,901,330
------------
Capital Goods--7.2%
23,526 Allied-Signal, Inc. 1,365,978
4,884 Avery Dennison Corp. 292,430
1,295 Ball Corp. 63,050
39,572 Boeing Co. 1,671,900
977 Briggs & Stratton Corp. 61,063
6,499 Browning-Ferris Industries, Inc. 269,709
3,060 Case Corp. 143,820
15,067 Caterpillar, Inc. 826,802
4,346 Cooper Industries, Inc. 215,399
9,711 Corning, Inc. 530,463
2,883 Crane Co. 86,670
5,139 Crown Cork & Seal Co., Inc. 161,236
5,618 Danaher Corp. 339,538
10,019 Deere & Co. 381,348
9,372 Dover Corp. 353,207
2,999 Eaton Corp. 261,475
18,502 Emerson Electric Co. 1,181,815
3,029 (1)Fruit of the Loom, Inc., Class A 31,237
5,323 General Dynamics Corp. 349,987
137,650 General Electric Co. 13,997,284
3,989 Grainger (W.W.), Inc. 211,666
2,008 Harnischfeger Industries, Inc. 14,433
5,290 Honeywell, Inc. 500,566
10,504 Illinois Tool Works, Inc. 806,182
6,907 Ingersoll-Rand Co. 439,890
3,557 Johnson Controls, Inc. 224,313
13,853 Laidlaw, Inc. 96,971
16,488 Lockheed Martin Corp. 666,734
14,250 Masco Corp. 407,016
1,615 Milacron, Inc. 34,420
1,848 Millipore Corp. 61,677
16,859 Minnesota Mining & Manufacturing Co. 1,445,659
344 NACCO Industries, Inc., Class A 25,671
1,742 National Service Industries, Inc. 64,127
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Equity Index Fund
<TABLE>
<CAPTION>
Shares Value
- -------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Capital Goods--continued
2,891 Northrop Grumman, Corp. $ 195,143
6,526 (1)Owens-Illinois, Inc. 199,043
5,205 Pall Corp. 104,425
4,575 Parker-Hannifin Corp. 199,870
11,453 Pitney Bowes, Inc. 730,129
3,330 Raychem Corp. 115,718
8,031 Rockwell International Corp. 443,211
3,504 (1)Sealed Air Corp. 217,686
7,147 Tenneco, Inc. 166,614
6,656 Textron, Inc. 592,800
6,672 (1)Thermo Electron Corp. 127,602
2,384 Thomas & Betts Corp. 102,065
2,609 Timken Co. 53,648
34,365 Tyco International Ltd. 3,002,642
18,972 United Technologies Corp. 1,177,450
24,928 Waste Management, Inc. 1,318,068
------------
Total 36,329,850
------------
Communication Services--7.8%
132,912 AT&T Corp. 7,376,611
24,031 (1)Airtouch Communications, Inc. 2,415,116
11,528 Alltel Corp. 826,414
46,344 Ameritech Corp. 3,050,015
65,207 Bell Atlantic Corp. 3,570,083
82,149 BellSouth Corp. 3,876,406
5,775 CenturyTel, Inc. 221,255
7,209 Frontier Corp. 379,374
40,541 GTE Corp. 2,556,617
77,017 (1)MCI Worldcom, Inc. 6,652,386
12,076 (1)NEXTEL Communications, Inc., Class A 445,303
82,166 SBC Communications, Inc. 4,200,737
18,494 Sprint Corp. 2,085,199
17,450 (1)Sprint Corp. (PCS Group) 785,250
21,109 U.S. West, Inc. 1,141,205
------------
Total 39,581,971
------------
Consumer Cyclical--7.9%
2,976 American Greetings Corp., Class A 85,188
6,416 (1)AutoZone, Inc. 185,663
3,691 Black & Decker Corp. 210,156
4,223 Block (H&R), Inc. 203,496
25,712 Carnival Corp. 1,054,192
35,835 (1)Cendant Corp. 660,708
2,496 Centex Corp. 92,508
4,215 Circuit City Stores, Inc. 302,690
4,349 Clorox Co. 438,977
4,599 (1)Consolidated Stores Corp. 158,091
</TABLE>
<TABLE>
<CAPTION>
Shares Value
- -----------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Consumer Cyclical--continued
3,184 Cooper Tire & Rubber Co. $ 75,620
1,760 Cummins Engine Co., Inc. 89,100
6,954 Dana Corp. 359,000
18,481 Dayton-Hudson Corp. 1,164,303
23,665 (1)Delphi Automotive Systems Corp. 464,426
3,379 Deluxe Corp. 121,855
4,487 Dillards, Inc., Class A 157,606
9,204 Dollar General Corp. 244,475
5,705 Donnelley (R.R.) & Sons Co. 206,806
3,943 Dow Jones & Co. 207,008
7,020 Dun & Bradstreet Corp. 245,700
9,008 (1)Federated Department Stores, Inc. 490,936
1,458 Fleetwood Enterprises, Inc. 37,088
3,183 Fluor Corp. 118,567
50,829 Ford Motor Co. 2,900,430
1,710 Foster Wheeler Corp. 23,513
11,829 Gannett Co., Inc. 854,645
23,942 Gap (The), Inc. 1,497,871
27,493 General Motors Corp. 1,897,017
7,557 Genuine Parts Co. 254,576
6,548 Goodyear Tire & Rubber Co. 390,834
2,983 Harcourt General, Inc. 146,726
8,242 Hasbro, Inc. 235,942
10,954 Hilton Hotels Corp. 150,618
62,009 Home Depot, Inc. 3,526,762
13,456 IMS Health, Inc. 331,354
4,360 ITT Industries, Inc. 164,590
5,838 Interpublic Group Cos., Inc. 442,229
1,484 Jostens, Inc. 31,350
20,707 (1)K Mart Corp. 318,370
2,008 Kaufman & Broad Homes Corp. 48,443
3,296 Knight-Ridder, Inc. 173,658
6,645 (1)Kohl's Corp. 453,106
9,572 Limited, Inc. 467,832
2,713 Liz Claiborne, Inc. 97,668
14,808 Lowe's Cos., Inc. 769,091
10,107 Marriott International, Inc., Class A 384,698
14,721 May Department Stores Co. 637,603
3,779 Maytag Corp. 266,656
2,479 McDermott International, Inc. 63,524
8,266 McGraw-Hill Cos., Inc. 428,799
2,198 Meredith Corp. 76,793
2,816 (1)Navistar International Corp. 139,040
7,661 New York Times Co., Class A 261,432
12,027 Nike, Inc., Class B 732,895
5,857 Nordstrom, Inc. 207,924
7,086 Omnicom Group, Inc. 496,020
2,279 Owens Corning 89,736
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Equity Index Fund
<TABLE>
<CAPTION>
Shares Value
- -----------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Consumer Cyclical--continued
3,282 PACCAR, Inc. $ 184,818
10,305 Paychex, Inc. 305,286
11,068 Penney (J.C.) Co., Inc. 572,077
2,280 Pep Boys-Manny Moe & Jack 43,035
1,813 Pulte Corp. 43,172
2,371 (1)Reebok International Ltd. 47,124
1,518 Russell Corp. 35,578
16,093 Sears, Roebuck & Co. 769,447
10,832 Service Corp. International 207,839
7,223 Sherwin-Williams Co. 222,559
2,473 Snap-On, Inc. 89,492
753 Springs Industries, Inc., Class A 29,838
3,730 Stanley Works 121,458
19,241 (1)Staples, Inc. 553,179
13,533 TJX Cos., Inc. 405,990
5,030 TRW, Inc. 251,814
4,158 Tandy Corp. 343,035
3,343 Times Mirror Co., Class A 197,028
10,577 (1)Toys "R' Us, Inc. 243,932
4,989 Tribune Co. 393,819
2,420 Tupperware Corp. 53,845
5,038 V.F. Corp. 231,748
186,872 Wal-Mart Stores, Inc. 7,965,419
3,194 Whirlpool Corp. 206,013
------------
Total 39,853,449
------------
Consumer Staples--11.7%
2,315 Alberto-Culver Co., Class B 61,203
10,314 Albertsons, Inc. 551,799
11,532 American Stores Co. 380,556
20,076 Anheuser-Busch Cos., Inc. 1,466,803
24,921 Archer-Daniels-Midland Co. 373,815
11,035 Avon Products, Inc. 545,543
12,004 BestFoods 600,200
2,885 Brown-Forman Corp., Class B 192,393
3,635 Brunswick Corp. 87,240
29,662 CBS Corp. 1,238,389
16,381 CVS Corp. 753,526
18,819 Campbell Soup Co. 830,388
11,068 (1)Clear Channel Communications, Inc. 731,180
17,764 Coca-Cola Enterprises, Inc. 643,945
103,552 Coca-Cola Co. 7,073,896
12,300 Colgate-Palmolive Co. 1,228,463
31,012 Comcast Corp., Class A 1,193,962
20,555 ConAgra, Inc. 535,715
1,537 Coors Adolph Co., Class B 73,008
9,094 (1)Costco Cos., Inc. 659,315
</TABLE>
<TABLE>
<CAPTION>
Shares Value
- -----------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Consumer Staples--continued
5,838 Darden Restaurants, Inc. $ 124,422
86,459 Disney (Walt) Co. 2,518,118
9,261 Fort James Corp. 339,184
7,184 Fortune Brands, Inc. 293,646
6,424 General Mills, Inc. 516,329
46,599 Gillette Co. 2,376,549
1,608 Great Atlantic & Pacific Tea Co., Inc. 52,662
5,304 (1)Harrah's Entertainment, Inc. 114,699
15,209 Heinz (H.J.) Co. 734,785
6,013 Hershey Foods Corp. 326,205
17,026 Kellogg Co. 590,589
22,763 Kimberly-Clark Corp. 1,335,904
3,074 (1)King World Productions, Inc. 102,595
17,253 (1)Kroger Co., Inc. 1,010,379
1,634 Longs Drug Stores Corp. 56,884
16,383 Mattel, Inc. 433,126
56,840 McDonald's Corp. 2,188,340
25,494 (1)MediaOne Group, Inc. 1,883,369
8,212 (1)Mirage Resorts, Inc. 168,346
11,798 Newell Rubbermaid, Inc. 477,819
61,634 PepsiCo, Inc. 2,207,268
102,273 Philip Morris Cos., Inc. 3,943,903
55,736 Procter & Gamble Co. 5,204,349
5,724 Quaker Oats Co. 378,142
13,645 RJR Nabisco Holdings Corp. 422,142
13,515 Ralston Purina Co. 368,284
10,858 Rite Aid Corp. 271,450
20,424 (2)Safeway, Inc. 949,716
38,371 Sara Lee Corp. 920,904
16,559 Seagram Co. Ltd. 860,033
5,062 SUPERVALU, Inc. 122,754
14,034 SYSCO Corp. 416,634
51,541 Time Warner, Inc. 3,508,009
6,407 (1)Tricon Global Restaurants, Inc. 373,208
7,812 UST, Inc. 238,266
24,009 Unilever NV, ADR 1,568,141
29,222 (1)Viacom, Inc., Class B 1,125,047
41,898 Walgreen Co. 974,129
5,228 Wendy's International, Inc. 142,463
6,239 Winn-Dixie Stores, Inc. 223,434
4,882 Wrigley (Wm.), Jr. Co. 425,039
------------
Total 59,508,604
------------
Energy--5.4%
3,796 Amerada-Hess Corp. 227,523
5,055 Anadarko Petroleum Corp. 189,563
4,106 Apache Corp. 147,816
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Equity Index Fund
<TABLE>
<CAPTION>
Shares Value
- -------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Energy--continued
3,212 Ashland, Inc. $ 130,889
13,493 Atlantic Richfield Co. 1,129,195
13,734 Baker Hughes, Inc. 427,471
27,407 Chevron Corp. 2,540,286
102,129 Exxon Corp. 8,157,554
18,469 Halliburton Co. 764,155
2,113 Helmerich & Payne, Inc. 49,259
3,627 Kerr-McGee Corp. 168,695
32,759 Mobil Corp. 3,316,849
14,531 Occidental Petroleum Corp. 306,967
10,696 Phillips Petroleum Co. 560,872
3,522 (1)Rowan Cos., Inc. 59,434
90,076 Royal Dutch Petroleum Co., ADR 5,094,924
22,932 Schlumberger Ltd. 1,380,220
10,082 Sempra Energy 216,763
3,929 Sunoco, Inc. 119,589
22,454 Texaco, Inc. 1,470,737
12,921 USX Corp. 386,822
10,544 Union Pacific Resources Group, Inc. 146,957
10,139 Unocal Corp. 403,025
------------
Total 27,395,565
------------
Finance--14.3%
10,716 AON Corp. 460,788
6,005 Aetna, Inc. 545,329
10,850 AFLAC, Inc. 553,350
34,466 Allstate Corp. 1,255,855
18,991 American Express Co. 2,301,472
10,588 American General Corp. 764,983
51,503 American International Group, Inc. 5,887,437
7,530 Amsouth Bancorporation 213,664
30,356 Associates First Capital Corp., Class A 1,244,596
13,057 BB&T Corp. 476,581
49,590 Bank One Corp. 2,804,934
72,700 Bank of America Corp. 4,702,781
31,953 Bank of New York Co., Inc. 1,142,320
12,376 BankBoston Corp. 586,313
4,003 Bankers Trust Corp. 370,528
4,565 Bear Stearns Cos., Inc. 202,572
8,674 CIGNA Corp. 808,851
2,755 Capital One Financial Corp. 415,144
35,529 Chase Manhattan Corp. 2,575,853
6,845 Chubb Corp. 479,578
7,014 Cincinnati Financial Corp. 288,889
95,039 Citigroup, Inc. 6,296,334
</TABLE>
<TABLE>
<CAPTION>
Shares Value
- -------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Finance--continued
6,534 Comerica, Inc. $ 394,899
13,609 Conseco, Inc. 415,925
4,699 Countrywide Credit Industries, Inc. 193,246
43,557 Fannie Mae 2,961,876
28,506 Freddie Mac 1,662,256
11,206 Fifth Third Bancorp 764,109
28,986 Firstar Corp. 835,159
41,619 First Union Corp. 1,917,075
23,874 Fleet Financial Group, Inc. 981,818
10,629 Franklin Resources, Inc. 462,362
2,391 Golden West Financial Corp. 226,846
9,806 Hartford Financial Services Group, Inc. 620,230
20,281 Household International, Inc. 879,688
8,866 Huntington Bancshares, Inc. 306,985
7,344 J.P. Morgan & Co., Inc. 1,023,111
4,452 Jefferson-Pilot Corp. 301,345
19,121 KeyCorp 664,455
4,872 Lehman Brothers Holdings, Inc. 266,133
4,244 Lincoln National Corp. 431,827
4,776 Loews Corp. 388,349
4,173 MBIA, Inc. 285,068
33,681 MBNA Corp. 930,451
4,600 MGIC Investment Corp. 221,375
10,809 Marsh & McLennan Cos., Inc. 786,355
21,940 Mellon Bank Corp. 782,984
6,610 Mercantile Bancorporation, Inc. 386,272
14,900 Merrill Lynch & Co., Inc. 1,251,600
24,266 Morgan Stanley, Dean Witter & Co. 2,341,669
13,894 National City Corp. 919,609
4,665 Northern Trust Corp. 421,599
12,639 PNC Bank Corp. 723,583
3,045 Progressive Corp. 427,442
5,681 Provident Cos., Inc. 221,914
5,948 Providian Financial Corp. 570,636
9,290 Regions Financial Corp. 351,859
4,506 Republic New York Corp. 306,126
5,724 SAFECO Corp. 251,498
6,961 SLM Holding Corp. 288,882
16,842 Schwab (Charles) Corp. 1,782,094
6,730 SouthTrust Corp. 262,049
9,902 St. Paul Cos., Inc. 352,140
6,742 State Street Corp. 514,078
7,293 Summit Bancorp 298,557
13,350 SunTrust Banks, Inc. 901,125
11,229 Synovus Financial Corp. 225,984
5,892 Torchmark Corp. 196,646
5,240 Transamerica Corp. 384,485
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Equity Index Fund
<TABLE>
<CAPTION>
Shares Value
- -----------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Finance--continued
30,485 U.S. Bancorp, Inc. $ 990,763
5,813 UNUM Corp. 312,812
5,716 Union Planters Corp. 236,142
8,517 Wachovia Corp. 751,625
24,921 Washington Mutual, Inc. 951,671
68,732 Wells Fargo Co. 2,749,280
------------
Total 72,454,219
------------
Healthcare--9.6%
63,751 Abbott Laboratories 2,880,748
2,772 Allergan, Inc. 257,796
3,660 (1)Alza Corp. 130,616
55,366 American Home Products Corp. 3,190,466
21,382 (1)Amgen, Inc. 1,352,412
2,252 Bard (C.R.), Inc. 102,888
2,356 Bausch & Lomb, Inc. 179,940
12,014 Baxter International, Inc. 775,654
10,385 Becton, Dickinson & Co. 402,419
4,713 Biomet, Inc. 188,225
16,505 (1)Boston Scientific Corp. 626,158
83,474 Bristol-Myers Squibb Co. 5,728,403
8,432 Cardinal Health, Inc. 509,082
27,116 Columbia/HCA Healthcare Corp. 638,921
12,656 Guidant Corp. 632,800
4,656 (1)HCR Manor Care, Inc. 124,548
17,771 (1)HEALTHSOUTH, Corp. 237,687
7,031 (1)Humana, Inc. 88,327
56,486 Johnson & Johnson 5,232,017
46,195 Lilly (Eli) & Co. 3,300,055
2,997 Mallinckrodt, Inc. 103,771
11,400 McKesson HBOC, Inc. 388,313
20,599 Medtronic, Inc. 1,462,529
100,066 Merck & Co., Inc. 6,754,455
2,092 PE Corp.-PE Biosystems Group 233,650
54,516 Pfizer, Inc. 5,833,212
21,342 Pharmacia & Upjohn, Inc. 1,183,147
61,734 Schering Plough Corp. 2,781,888
3,535 (1)St. Jude Medical, Inc. 119,527
13,007 (1)Tenet Healthcare Corp. 318,673
7,823 United Healthcare Corp. 455,690
34,505 Warner-Lambert Co. 2,139,310
4,060 (1)Watson Pharmaceuticals, Inc. 155,549
------------
Total 48,508,876
------------
Technology--17.9%
15,064 (1)3Com Corp. 411,436
2,760 Adobe System, Inc. 204,585
6,082 (1)Advanced Micro Devices, Inc. 112,517
</TABLE>
<TABLE>
<CAPTION>
Shares Value
- -------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Technology--continued
43,190 (1)America Online, Inc. $ 5,155,806
3,617 (1)Andrew Corp. 56,064
5,656 (1)Apple Computer, Inc. 249,218
15,524 (1)Applied Materials, Inc. 852,850
9,113 (1)Ascend Communications, Inc. 844,661
1,948 Autodesk, Inc. 53,814
25,781 Automatic Data Processing, Inc. 1,061,855
9,054 (1)BMC Software, Inc. 447,607
7,319 (1)Cabletron Systems, Inc. 108,870
6,010 (1)Ceridian Corp. 198,330
66,331 (1)Cisco Systems, Inc. 7,230,079
71,012 Compaq Computer Corp. 1,682,097
22,611 Computer Associates International, Inc. 1,069,783
6,657 (1)Computer Sciences Corp. 430,625
15,438 (1)Compuware Corp. 479,543
2,079 (1)Data General Corp. 27,287
106,992 (1)Dell Computer Corp. 3,684,537
1,878 EG & G, Inc. 55,753
21,081 (1)EMC Corp. 2,100,195
13,608 Eastman Kodak Co. 920,241
20,699 Electronic Data Systems Corp. 1,164,319
6,194 Equifax, Inc. 222,984
18,594 First Data Corp. 835,568
6,565 (1)Gateway 2000, Inc. 399,234
7,032 (1)General Instrument Corp. 272,051
3,362 Harris Corp. 127,126
42,766 Hewlett-Packard Co. 4,033,368
5,694 IKON Office Solutions, Inc. 79,360
140,052 Intel Corp. 7,571,561
77,590 International Business Machines Corp. 9,024,687
3,672 (1)KLA-Tencor Corp. 167,076
5,934 (1)LSI Logic Corp. 219,929
111,278 Lucent Technologies, Inc. 6,328,936
8,969 Micron Technology, Inc. 340,261
211,894 (1)Microsoft Corp. 17,097,197
25,212 Motorola, Inc. 2,087,869
6,980 (1)National Semiconductor Corp. 135,238
27,794 Nortel Networks Corp. 2,084,550
13,990 (1)Novell, Inc. 328,765
60,440 (1)Oracle Corp. 1,499,668
11,035 (1)Parametric Technology Corp. 153,111
9,788 (1)PeopleSoft, Inc. 158,443
1,842 Polaroid Corp. 38,912
14,155 Raytheon Co., Class B 963,425
3,148 Scientific-Atlanta, Inc. 111,164
10,302 (1)Seagate Technology, Inc. 310,992
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Equity Index Fund
<TABLE>
<CAPTION>
Shares Value
- -----------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Technology--continued
1,117 Shared Medical Systems Corp. $ 73,443
7,874 (1)Silicon Graphics, Inc. 97,441
10,286 (1)Solectron Corp. 563,159
31,974 (1)Sun Microsystems, Inc. 1,910,447
1,988 Tektronix, Inc. 46,097
16,320 (1)Tellabs, Inc. 954,720
16,379 Texas Instruments, Inc. 1,791,453
11,120 (1)Unisys Corp. 421,865
27,550 Xerox Corp. 1,547,966
------------
Total 90,600,138
------------
Transportation--0.9%
7,660 (1)AMR Corp. 498,379
19,705 Burlington Northern Santa Fe 610,855
9,169 CSX Corp. 430,370
5,998 Delta Air Lines, Inc. 344,135
12,396 (1)FDX Corp. 682,555
4,920 Kansas City Southern Industries, Inc. 276,750
15,929 Norfolk Southern Corp. 521,675
3,011 Ryder Systems, Inc. 72,264
14,129 Southwest Airlines Co. 453,011
3,672 (1)US Airways Group, Inc. 178,322
10,392 Union Pacific Corp. 592,994
------------
Total 4,661,310
------------
Utilities--2.7%
7,574 (1)AES Corp. 376,806
5,764 Ameren Corp. 235,963
8,038 American Electric Power Co., Inc. 348,648
7,445 Burlington Resources, Inc. 319,669
4,300 CMS Energy Corp. 199,950
6,357 Carolina Power & Light Co. 278,118
8,931 Central & SouthWest Corp. 229,973
6,662 Cinergy Corp. 227,340
8,934 Coastal Corp. 344,517
3,505 Columbia Energy Group 187,517
9,795 Consolidated Edison Co. 475,669
4,026 Consolidated Natural Gas Co. 239,295
6,269 Constellation Energy Group 195,514
6,094 DTE Energy Co. 265,469
8,207 Dominion Resources, Inc. 354,439
15,205 Duke Energy Corp. 917,051
945 Eastern Enterprises 32,779
14,816 Edison International 407,440
14,693 Enron Corp. 1,048,712
</TABLE>
<TABLE>
<CAPTION>
Shares or
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Utilities--continued
10,359 Entergy Corp. $ 336,020
7,598 FPL Group, Inc. 442,108
9,959 FirstEnergy Corp. 316,820
5,375 GPU, Inc. 234,148
2,001 NICOR, Inc. 75,287
4,802 New Century Energies, Inc. 194,181
7,871 Niagara Mohawk Holdings, Inc. 117,081
6,409 Northern States Power Co. 167,034
1,324 ONEOK, Inc. 39,720
16,068 P G & E Corp. 542,295
6,354 P P & L Resources, Inc. 190,620
12,490 Pacificorp 227,161
9,412 PECO Energy Co. 460,599
1,487 Peoples Energy Corp. 57,249
9,187 Public Service Enterprises Group, Inc. 385,279
11,950 Reliant Energy, Inc. 364,475
4,622 Sonat, Inc. 163,792
29,289 Southern Co. 831,062
11,860 Texas Utilities Co. 533,700
9,123 Unicom Corp. 386,016
17,969 Williams Cos., Inc. (The) 931,018
------------
Total 13,680,534
------------
Total Common Stocks (identified
cost $210,781,307) 447,475,846
------------
U.S. Government Agency--3.9%
$20,000,000 (2)Federal Home Loan Mortgage Corp., Discount Bond,
9/9/1999 (identified cost $19,732,778) 19,733,400
------------
U.S. Treasury Obligations--0.7%
2,700,000 (2)United States Treasury Bill, 6/17/1999 2,694,600
900,000 (2)United States Treasury Bill, 9/16/1999 887,778
------------
Total U.S. Treasury Obligations (identified cost
$3,582,542) 3,582,378
------------
(3) Repurchase Agreement--7.1%
35,792,504 Goldman Sachs Group, LP, 4.50%, dated 5/28/1999,
due 6/1/1999 (at amortized cost) 35,792,504
------------
Total Investments (identified cost $269,889,131) $506,584,128
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Special Values Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Shares Value
- -------------------------------------------------------------
<C> <S> <C>
Common Stocks--83.9%
Basic Materials--9.3%
15,000 AK Steel Holding Corp. $ 360,000
85,000 (1)American Pacific Corp. 685,313
6,000 (1)Bush Boake Allen, Inc. 172,875
54,400 Barrick Gold Corp. 938,400
153,000 Battle Mountain Gold Co. 372,938
67,800 Cleveland Cliffs, Inc. 2,508,600
33,600 Consolidated Tomoka Co. 508,200
66,000 Deltic Timber Corp. 1,641,750
53,500 Greif Brothers Corp., Class A 1,377,625
101,000 Homestake Mining Co. 789,063
76,400 LTV Corp. 467,950
65,000 (1)Midwest Grain Products, Inc. 625,625
34,000 Mississippi Chemical Corp. 327,250
14,500 NCH Corp. 795,688
94,000 Roanoke Electric Corp. 1,492,250
84,000 Rock-Tenn Co. 1,270,500
37,800 Texas Industries, Inc. 1,374,975
------------
Total 15,709,002
------------
Capital Goods--10.2%
100,600 Amcast Industrial Corp. 1,691,338
88,500 Ampco-Pittsburgh Corp. 1,106,250
150,000 (1)Ansaldo Signal NV 534,375
28,000 (1)BFC Construction Corp. 208,250
55,450 Butler Manufacturing Co. 1,559,531
113,100 (1)EMCOR Group, Inc. 2,558,888
10,100 Franklin Electric, Inc. 627,463
69,000 (1)Harding Lawson Associates Group 595,125
52,900 Millipore Corp. 1,765,538
119,700 Morrison Knudsen Corp. 1,189,519
65,350 Smith (A.O.) Corp. 1,592,906
14,000 Smith Investment Co. 686,000
139,875 (1)Supreme Industries, Inc. 1,355,039
100,000 (1)Todd Shipyards Corp. 537,500
62,800 Twin Disc, Inc. 1,193,200
------------
Total 17,200,922
------------
Consumer Cyclical--12.7%
16,000 Allen Organ Co., Class B 576,000
78,000 Boston Acoustics, Inc. 1,443,000
63,000 (1)Buckhead America Corp. 385,875
13,800 Cadmus Communications Corp. 179,400
7,100 Capital Southwest Corp. 551,138
168,900 Cavalier Homes, Inc. 1,530,656
</TABLE>
<TABLE>
<CAPTION>
Shares Value
- ------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Consumer Cyclical--continued
35,500 Cordiant Communications Group PLC, ADR $ 443,750
50,000 Enesco Group, Inc. 1,146,875
4,000 Grey Advertising, Inc. 1,204,000
22,700 (1)GTECH Holdings Corp. 560,406
122,300 GP Strategies Corp. 1,223,000
179,400 Intermet Corp. 2,489,175
96,000 Johns Manville Corp. 1,260,000
56,000 (1)K Mart Corp. 861,000
33,600 Lone Star Industries, Inc. 1,197,000
3,400 Lone Star Industries, Inc.--Warrants 179,350
275,000 (1)Oneita Industries, Inc. 8,250
32,100 (1)Powerhouse Technologies, Inc. 593,850
90,900 (1)Racing Champions Corp. 1,556,663
43,100 Raven Industries, Inc. 689,600
21,600 Russell Corp. 506,250
41,700 Skyline Corp. 1,300,519
32,700 (1)Sport-Haley, Inc. 139,997
115,000 Velcro Industries NV 1,372,813
------------
Total 21,398,567
------------
Consumer Staples--7.9%
87,400 (1)800-JR Cigar, Inc. 797,525
75,500 (1)Alltrista Corp. 2,066,813
18,500 Ascent Entertainment Group, Inc. 210,438
42,147 (1)Chris Craft Industries, Inc. 1,944,030
32,000 Coastcast Corp. 384,000
21,000 (1)Craig Corp. 158,813
137,000 (1)Craig Corp., Pfd. 1,027,500
13,500 (1)Emmis Communications, Corp., Class A 631,125
29,000 (1)GC Cos., Inc. 1,047,625
185,000 (1)Host Marriott Services Corp. 1,445,313
201,900 (1)M & F Worldwide Corp. 1,564,725
32,500 National Presto Industries, Inc. 1,212,656
65,200 (1)On Command Corp. 912,800
------------
Total 13,403,363
------------
Energy--4.7%
25,400 (1)Atwood Oceanics, Inc. 736,600
69,700 Berry Petroleum Co., Class A 993,227
112,765 (1)Forest Oil Corp. 1,191,080
131,000 (1)Global Marine, Inc. 1,842,188
57,000 Holly Corp. 726,750
190,300 Kaneb Services, Inc. 844,456
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Special Values Fund
<TABLE>
<CAPTION>
Shares Value
- ----------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Energy--continued
186,550 (2)Santa Fe Snyder Corp. $ 1,585,675
------------
Total 7,919,976
------------
Finance--18.1%
66,000 Argonaut Group, Inc. 1,773,750
54,000 CNA Surety Corp. 783,000
122,800 Capital Re Corp. 2,003,175
134,100 Charter Municipal Mortgage Acceptance Co. 1,726,538
193,400 (1)Danielson Holding Corp. 1,027,438
11,500 Duff & Phelps Credit Rating 707,969
60,800 Eaton Vance Corp. 1,862,000
47,100 Financial Security Assurance Holdings Ltd. 2,672,925
17,700 Fund American Enterprises, Inc. 2,637,300
195,400 (1)Healthcare Recoveries, Inc. 793,813
87,600 IPC Holdings Ltd. 1,768,425
58,500 John Nuveen & Co., Inc., Class A 2,464,313
25,600 LaSalle Re Holdings Ltd. 361,600
80,000 Leucadia National Corp. 1,670,000
22,600 Liberty Corp. 1,168,138
62,600 Liberty Financial Cos., Inc. 1,635,425
50,000 Merchants Group, Inc. 1,093,750
82,000 PXRE Corp. 1,527,250
60,000 (1)Standard Management Corp. 378,750
89,000 Stewart Information Services Corp. 1,729,938
39,600 Unico American Corp. 420,750
30,000 Virginia Capital Bancshares, Inc. 420,000
------------
Total 30,626,247
------------
Healthcare--2.8%
79,500 (1)America Service Group, Inc. 944,063
10,000 (1)Astrosystems, Inc. 27,815
29,700 (1)Hanger Orthopedic Group, Inc. 486,338
19,950 (1)Healthcare Services Group, Inc. 189,525
257,200 (1)Medaphis Corp. 1,286,000
5,000 Mine Safety Appliances Co. 312,500
91,400 (1)Sunrise Medical, Inc. 759,763
99,350 (1)Thermotrex Corp. 813,428
------------
Total 4,819,432
------------
Real Estate--2.5%
68,100 Aegis Realty, Inc. 681,000
72,300 Forest City Enterprises, Inc., Class A 2,001,812
</TABLE>
<TABLE>
<CAPTION>
Shares Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Real Estate--continued
84,000 Lexford Residential Trust $ 1,485,750
------------
Total 4,168,562
------------
Technology--13.1%
45,000 (1)4Front Software, International, Inc. 450,000
49,000 (1)Anacomp, Inc. 921,813
149,500 (1)Cypress Semiconductor Corp. 1,663,188
122,200 (1)ESCO Electronics Corp. 1,474,038
40,800 (1)Eagle Point Software Corp. 275,400
72,300 (1)Electroglas, Inc. 1,048,350
47,500 (1)Evans & Sutherland Computer Co. 748,125
60,000 (1)Exar Corp. 1,252,500
73,900 (1)FSI International, Inc. 605,056
7,500 (1)Intuit, Inc. 610,313
50,400 (1)Kulicke & Soffa Industries, Inc. 1,064,700
34,000 Moore Products Co. 782,000
111,400 Nam Tai Electronics, Inc. 1,009,563
70,000 (1)National Semiconductor Corp. 1,356,250
56,000 (1)Novell, Inc. 1,316,000
115,212 (1)Phoenix Technology, Ltd. 1,245,735
57,000 (1)Remedy Corp. 1,083,000
72,000 Salient 3 Communications, Inc., Class A 589,500
92,500 (1)Silicon Valley Group, Inc. 1,271,875
127,200 United Industrial Corp. 1,462,800
37,700 (1)Vertex Communications Corp. 558,431
47,000 (1)Wang Laboratories, Inc. 1,360,063
------------
Total 22,148,700
------------
Transportation--1.6%
113,300 (1)Consolidated Freightways Corp. 1,515,388
30,000 (1)Kirby Corp. 566,250
64,000 Pittston BAX Group 692,000
------------
Total 2,773,638
------------
Utilities--1.0%
84,950 UGI Corp. 1,672,440
------------
Total Common Stocks (identified cost $134,460,698) 141,840,849
------------
Preferred Stock--0.4%
40,000 Price Enterprises, Inc., Cumulative Pfd., Series A,
$1.40 (identified cost $0) 602,500
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Special Values Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Corporate Bonds--0.3%
Healthcare--0.2%
$ 600,000 Medaphis Corp., Company Guarantee, Series B, 9.50%,
2/15/2005 $ 429,000
------------
Industrial Services--0.1%
250,000 American Rice, Inc., Mtg. Bond, 13.00%, 7/31/2002 112,500
------------
Total Corporate Bonds (identified cost $663,875) 541,500
------------
U.S. Treasury Obligations--0.3%
550,000 United States Treasury Bill, 6/17/1999 (identified
cost $548,922) 548,922
------------
</TABLE>
<TABLE>
<CAPTION>
Shares or
Principal
Amount Value
- ------------------------------------------------------------------------------
<C> <S> <C>
Closed-End Investment Company--0.4%
130,000 Royce Focus Trust, Inc. (identified cost $604,500)
(at net asset value) $ 633,750
------------
(3) Repurchase Agreement--14.6%
$24,726,309 Goldman Sachs Group, LP, 4.50%, dated 5/28/1999,
due 6/1/1999 (at amortized cost) 24,726,309
------------
Total Investments (identified cost $161,004,304) $168,893,830
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Emerging Markets Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Value in
Shares U.S. Dollars
<C> <S> <C>
- -----------------------------------------------------------------------------
Common Stocks--86.2%
Argentina--4.1%
200,000 Acindar-Industria Argentina de Aceros SA $ 240,190
48,150 Banco de Galicia y Buenos Aires SA de CV, Class B,
ADR 1,008,141
249,730 Compania Naviera Perez Companc SA, Class B 1,499,564
11,195 IRSA Inversiones y Representaciones SA, GDR 323,256
20,000 Importadora y Exportadora de la Patagonia 136,108
50,000 Quilmes Industrial SA, ADR 565,625
300,000 Siderca SA, Class A 414,327
50,000 Telecom Argentina SA, ADR 1,425,000
31,000 YPF Sociedad Anonima, ADR 1,305,875
------------
Total 6,918,086
------------
Brazil--5.8%
35,000 Aracruz Cellulose, ADR 673,750
20,000 Companhia Brasileira de Distribuicao Grupo Pao de
Acucar, ADR 362,500
60,000 Companhia Cervajaria Brahma, ADR 615,000
5,000,000 Companhia Paulista de Forca e Luz 336,180
57,000 Companhia Vale do Rio Doce 770,306
110,000 (1)Embratel Participacoes SA, ADR 1,512,500
23,000 (1)Tele Centro Sul Participacoes SA, ADR 1,242,000
130,000 (1)Tele Norte Leste Participacoes SA, ADR 2,128,750
15,000 (1)Tele Sudeste Celular Participacoes SA, ADR 365,625
29,000 (1)Telesp Celular Participacoes SA, ADR 676,063
50,000 (1)Unibanco-Uniao de Bancos Brasileiros SA, GDR 1,128,125
------------
Total 9,810,799
------------
Chile--3.2%
50,000 Banco de A. Edwards, ADR 712,500
</TABLE>
<TABLE>
<CAPTION>
Value in
Shares U.S. Dollars
<C> <S> <C>
- -----------------------------------------------------------------------------
Common Stocks--continued
Chile--continued
25,800 Compania Cervecerias Unidas SA, ADR $ 722,400
47,000 Compania Telecomunicacion de Chile, ADR 1,022,250
20,600 Cristalerias de Chile, ADR 328,313
25,000 (1)Distribucion y Servicio D&S SA, ADR 421,875
32,000 Embotelladora Andina SA, Class B, ADR 500,000
48,542 Gener SA, ADR 919,264
40,000 (1)Quinenco SA, ADR 420,000
10,578 Sociedad Quimica Y Minera de Chile, ADR 368,908
------------
Total 5,415,510
------------
China--0.8%
1,500,000 Guangshen Railway Co. Ltd., Class H 174,084
1,100,000 GZI Transportation Ltd. 198,585
2,200,000 Harbin Power Equipment Co., Class H 133,335
11,500 (1)Huaneng Power International, Inc., Class N, ADR 143,031
2,000,000 Maanshan Iron & Steel Co., Class H 100,582
2,350,000 Qingling Motors Co., Class H 303,036
1,000,000 Shanghai Petrochemical Co. Ltd., Class H 153,452
1,000,000 Yizheng Chemcial Fibre Co. 149,584
------------
Total 1,355,689
------------
Colombia--0.1%
20,000 Bancolombia SA, ADR 100,000
4,751 Banco de Bogota 15,707
------------
Total 115,707
------------
Croatia--1.3%
120,000 (1)(4)Pliva D.D., GDR 1,883,820
33,250 (1)(4)Zagrebacka Banka, GDR 328,344
------------
Total 2,212,164
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Emerging Markets Fund
<TABLE>
<CAPTION>
Value in
Shares U.S. Dollars
<C> <S> <C>
- ----------------------------------------------------------------------
Common Stocks--continued
Czech Republic--1.3%
50,000 Ceska Sporitelna AS $ 242,701
14,100 (1)(4)Ceske Radiokomunikace, GDR 521,700
70,000 (1)SPT Telecom AS 1,163,105
150,000 (1)Unipetrol 208,565
------------
Total 2,136,071
------------
Dominican Republic--0.2%
40,000 (1)Tricom SA, ADR 357,500
------------
Egypt--1.7%
47,000 (1)Al-Ahram Beverages Co., GDR 1,535,561
50,000 (1)Commercial International Bank Egypt, GDR 456,250
6,000 Egypt International Pharmaceuticals 314,703
23,000 (1)(4)MI Bank, GDR 246,100
20,000 Suez Cement Co., Class S, GDR 297,000
------------
Total 2,849,614
------------
Estonia--0.2%
55,000 (1)(4)Eesti Uhispank, GDR 298,375
1,000 (1)(4)Estonian Telecom Ltd., GDR 22,400
------------
Total 320,775
------------
Greece--5.3%
11,222 Alpha Credit Bank 761,295
8,750 Commercial Bank of Greece 1,580,116
14,360 Goody's SA 404,870
27,500 Hellenic Bottling Co. SA 802,688
60,000 (1)Hellenic Petroleum SA 544,641
34,800 Hellenic Technodomiki 724,988
79,188 Hellenic Telecommunication Organization SA 1,714,493
11,256 National Bank of Greece 785,264
39,230 Sarantis SA 644,260
11,700 Titan Cement Co. SA 1,080,814
------------
Total 9,043,429
------------
Hong Kong--2.8%
77,000 CLP Holdings Ltd. 371,355
50,000 Cheung Kong 406,197
300,000 (1)China Telecom (Hong Kong) Ltd. 632,507
240,000 Citic Pacific Ltd. 623,610
1,100,000 Cosco Pacific Ltd. 648,948
130,000 Dao Heng Bank Group Ltd. 504,587
24,300 HSBC Holdings PLC 795,915
</TABLE>
<TABLE>
<CAPTION>
Value in
Shares U.S. Dollars
<C> <S> <C>
- ---------------------------------------------------------------------
Common Stocks--continued
Hong Kong--continued
55,000 Hong Kong Electric Holdings Ltd. $ 172,344
50,000 Hutchison Whampoa 417,481
20,000 Sun Hung Kai Properties 159,900
------------
Total 4,732,844
------------
Hungary--3.5%
25,900 (1)Antenna Hungaria 499,471
10,000 (1)(4)BorsodChem RT, GDR 242,500
8,000 Danubius Hotels RT 133,383
35,000 (1)Euronet Services, Inc., ADR 71,094
20,000 (4)Gedeon Richter, GDR 741,000
20,000 (1)(4)MOL Magyar Olay, GDR 488,438
80,000 (1)Matav RT, ADR 2,240,000
15,000 OTP Bank RT, GDR 656,250
7,000 Pick Szeged RT 206,218
60,000 (1)Synergon Information Systems 750,909
------------
Total 6,029,263
------------
India--0.8%
14,200 Bajaj Auto Ltd., GDR 243,530
13,800 BSES, GDR 136,275
16,500 Indian Hotels Co. Ltd., GDR 117,563
24,500 Larsen & Toubro Ltd., GDR 305,638
22,000 Ranbaxy Labs, GDR 291,500
26,000 (1)(4)Reliance Industries Ltd., GDR 228,800
------------
Total 1,323,306
------------
Indonesia--2.1%
700,000 PT Daya Guna Samudera 456,615
225,000 PT Gudang Garam 434,769
1,142,115 PT Indah Kiat Pulp & Paper Corp. 527,130
517,500 PT Indosat 1,050,923
419,345 PT Semen Gresik 701,919
835,000 PT Telekomunikasi Indonesia 387,954
------------
Total 3,559,310
------------
Israel--4.1%
520,000 Bank Hapoalim 1,317,446
910,000 Bank Leumi Le-Israel 1,711,481
155,000 Bezeq Israeli Telecommunication Corp. Ltd. 664,656
9,250 Koor Industries Ltd. 998,920
16,500 Matav-Cable Systems Media Ltd., ADR 622,875
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Emerging Markets Fund
<TABLE>
<CAPTION>
Value in
Shares U.S. Dollars
<C> <S> <C>
- ----------------------------------------------------------------------------
Common Stocks--continued
Israel--continued
32,500 (1)NICE-Systems Ltd., ADR $ 828,750
70,000 (1)Supersol Ltd. 186,861
14,500 Teva Pharmaceutical Industries Ltd. 710,802
------------
Total 7,041,791
------------
Korea, Republic of--8.2%
52,500 Dongwon Securities 1,135,578
73,500 Hanjin Heavy Industries 384,281
70,000 Housing & Commercial Bank, Korea 1,918,455
70,000 Kookmin Bank 1,059,577
40,000 Korea Electric Power Corp. 1,224,438
3,000 (1)Korea Telecom, ADR 95,438
21,559 LG Electronics, Inc. 410,873
23,303 LG Information & Communication Ltd. 953,068
7,500 Pohang Iron and Steel Co. Ltd. 690,328
376 SK Telecom Co. Ltd. 474,023
18,875 Samsung Display Devices 907,261
36,999 Samsung Electronics Co. 2,574,033
3,915 Samsung Fire & Marine Insurance 2,010,571
------------
Total 13,837,924
------------
Lebanon--0.5%
40,000 (1)(4)Banque Libanaise Pour Le Comm, Class B, GDR 538,000
25,000 (1)(4)Solidere, GDR 263,125
------------
Total 801,125
------------
Lithuania--0.2%
50,000 Vilniaus Bankas AB, GDR 350,000
------------
Malaysia--1.3%
200,000 Berjaya Sports 418,421
110,000 Genting Berhad 390,789
200,000 Resorts World Berhad 389,474
50,000 Rothmans of Pall Mall (Malaysia) Berhad 368,421
165,000 Telekom Malaysia Berhad 564,474
------------
Total 2,131,579
------------
Mexico--9.5%
150,000 Carso Global Telecom, Class A-1 827,798
356,600 Cemex SA 1,567,072
550,000 Cifra SA de CV 893,715
260,000 (1)Corporacion GEO, SA de CV, Class B 983,137
</TABLE>
<TABLE>
<CAPTION>
Value in
Shares U.S. Dollars
<C> <S> <C>
- ------------------------------------------------------------------------------
Common Stocks--continued
Mexico--continued
20,310 Desc SA de CV, Class C, ADR $ 454,436
45,000 (1)Fomento Economico Mexicano, SA de CV, ADR 1,501,875
249,800 Grupo Carso SA de CV 1,021,155
600,000 Grupo Elektra 324,987
650,000 Grupo Financiero Banamex Accival, SA de CV, Class O 1,301,992
200,000 Grupo Mexico SA, Class B 676,546
30,000 Grupo Televisa SA, GDR 1,254,375
200,000 Kimberly-Clark de Mexico 654,062
90,000 Organizacion Soriana SA de CV, Class B 337,098
50,000 Telefonos de Mexico, Class L, ADR 3,996,875
60,000 Vitro SA, ADR 356,250
------------
Total 16,151,373
------------
Morocco--0.1%
10,000 (4)Banque Marocaine du Commerce Exterieur, GDR 217,491
------------
Peru--1.8%
400,000 Banco Continental 207,995
55,000 CPT Telefonica del Peru SA, Class B, ADR 797,500
27,721 Cementos Lima SA 462,433
619,661 Cervecer Backus & Johnston, Class T 270,066
70,000 Cia de Minas Buenaventura SA 336,640
48,721 Credicorp Ltd. 540,803
450,000 Luz Del Sur Servicos SA, Class B 281,334
64,936 Minsur SA 131,746
------------
Total 3,028,517
------------
Philippines--3.0%
2,167,812 Ayala Land, Inc. 697,916
7,000,000 (1)Belle Corp. 408,410
430,000 Manila Electric Co., Class B 1,480,420
100,800 Metro Bank and Trust Co. 973,561
48,500 Philippine Long Distance Telephone Co., ADR 1,400,438
7,100,000 Solid Group, Inc. 132,484
------------
Total 5,093,229
------------
Poland--2.4%
20,000 (1)Art Marketing Syndicate SA 233,994
6,500 Bank Slaski SA 310,068
54,756 (1)Budimex SA 295,570
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Emerging Markets Fund
<TABLE>
<CAPTION>
Value in
Shares U.S. Dollars
<C> <S> <C>
- ---------------------------------------------------------------
Common Stocks--continued
Poland--continued
75,000 Elektrim SA $ 875,596
55,000 (1)Okocimskie Zaklady Piwowarskie SA 276,174
49,660 (1)Orbis SA 415,184
15,000 Prokom Software, GDR 245,250
15,000 Softbank SA 436,857
60,000 (1)(4)Telekomunikacja Polska SA, GDR 361,500
50,000 WBK (Weilkopolski Bank Kreditowy SA) 292,493
40,000 (1)Zalady Metali Lekkich Kety 384,635
------------
Total 4,127,321
------------
Romania--0.1%
15,039 (1)Alro Slatina 66,412
35,000 (1)LaFarge Romcim 109,760
301,965 (1)Sanex SA 10,822
158,826 (1)Terapia SA 51,841
------------
Total 238,835
------------
Russia--1.6%
702,000 Aeroflot 96,174
34,142 Kubanelectrosvyaz, RDC 247,329
25,000 Lukoil Holding Co., ADR 930,000
120,000 Sun Interbrew Ltd., RDC 348,000
140,000 Surgutneftegaz, ADR 1,076,600
16,000 (1)Udmurt Telecom 16,400
------------
Total 2,714,503
------------
Slovakia--0.4%
225,000 (4)Slovakopharma AS, GDR 647,600
------------
South Africa--7.0%
150,000 ABSA Group Ltd. 688,360
45,000 (1)Anglo American PLC 2,040,531
50,000 Barlow Ltd. 232,663
70,000 Bidvest Group Ltd. 497,015
50,000 (1)DataTec Ltd. 674,722
45,000 De Beers Consolidated Mines, ADR 964,688
70,000 Dimension Data Holdings Ltd. 280,800
30,000 Impala Platinum Holdings Ltd. 719,168
40,000 Imperial Holdings Ltd. 326,049
90,000 Johnnies Industries Corp. 517,714
30,000 Nedcor Ltd. 600,751
500,000 Protea Furnishers Ltd. 308,880
</TABLE>
<TABLE>
<CAPTION>
Value in
Shares U.S. Dollars
<C> <S> <C>
- -------------------------------------------------------------------------
Common Stocks--continued
South Africa--continued
1,000,000 (1)Sanlam Ltd. $ 962,742
100,000 Sappi Ltd. 609,737
100,000 Sasol Ltd. 561,599
225,000 (1)South African Breweries PLC 1,808,751
------------
Total 11,794,170
------------
Taiwan, Republic of
China--1.3%
22,084 (1)Advanced Semiconductor Engineering, GDR 345,063
29,967 Asia Cement Corp., GDR 254,717
30,674 (1)GVC Corp., GDR 88,188
34,560 (1)President Enterprises, GDR 293,760
20,000 (1)Taiwan Semiconductor Manufacturing Co., ADR 523,750
68,600 (1)Yageo Corp., GDR 369,068
37,179 (1)Yang Ming Marine Transport, GDR 288,137
------------
Total 2,162,683
------------
Thailand--4.2%
220,000 BEC World Public Co. Ltd. 1,097,035
300,000 Bangkok Bank Public Co., Ltd. 929,919
120,000 Electricity Generating PLC 255,526
350,000 Hana Microelectronics Co., Ltd. 603,773
135,000 PTT Exploration and Production Public Co. 1,098,922
328,600 Shin Corp. 1,071,714
35,000 Siam Cement Co., Ltd. 909,434
400,000 Thai Farmers Bank Co. 1,099,730
------------
Total 7,066,053
------------
Turkey--5.4%
72,443,828 Akbank T.A.S 1,191,730
27,840,000 Aksigorta 888,616
9,700,000 Alcatel Teletas 702,579
18,000,000 Arcelik AS 618,731
4,900,000 Aygaz 517,328
45,240,000 Eregli Demir Ve Celik Fabrikalari T.A.S 866,400
7,745,468 Koc Holding AS 599,045
179,100 Migros Turk 228,665
2,500,000 Petrol Ofisi AS 782,622
47,375,000 Sabanci Holding 1,163,190
25,420,214 T Sise Cam 318,313
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Emerging Markets Fund
<TABLE>
<CAPTION>
Value in
Shares U.S. Dollars
<C> <S> <C>
- ------------------------------------------------------------------------------
Common Stocks--continued
Turkey--continued
5,720,000 Tupras Turkiye Petrol Rafinerileri AS $ 400,260
29,360,378 Turk Sise ve Cam Fabrikalari 367,649
26,400,000 Turkiye Is Bankasi 518,556
------------
Total 9,163,684
------------
Venezuela--1.9%
65,000 Compania Anonima Nacional Telefonos de Venezuela,
Class D, ADR 1,515,313
2,903,032 Electricadade de Caracas 1,284,770
70,000 Mavesa SA, ADR 249,375
30,000 Siderurgica Venezolana Sivensa, ADR 119,322
------------
Total 3,168,780
------------
Total Common Stocks (identified cost $132,686,820) 145,916,725
------------
Preferred Stocks--3.8%
Brazil--3.7%
50,000,000 Centrais Eletricas Brasileiras SA, Preference,
Series B 1,046,451
55,251,630 Companhia Energetica de Minas Gerais, Preference 1,154,450
80,000,000 Companhia Paranaense de Energia-Copel, Preference,
Series B 604,732
65,000,000 Gerdau SA, Preference 975,188
9,000,000 Petroleo Brasileiro SA, Preference 1,272,360
10,000,000 Telecomunicacoes de Sao Paulo SA, Preference 1,217,542
------------
Total 6,270,723
------------
Russia--0.1%
550 (1)Karelia Electrosvyaz, Pfd. 15,510
2,000,000 Surgutneftegaz, Pfd. 89,328
------------
Total 104,838
------------
Total Preferred Stocks (identified cost $6,542,017) 6,375,561
------------
Rights--0.1%
Greece--0.1%
11,222 Alpha Credit Bank 38,335
21,256 National Bank of Greece 61,362
------------
Total 99,697
------------
</TABLE>
<TABLE>
<CAPTION>
Shares or
Principal Value in
Amount U.S. Dollars
<C> <S> <C>
- -----------------------------------------------------------------------------
Rights--continued
Korea, Republic of--0.0%
3,028 Samsung Electronics Co. $ 32,173
------------
Total Rights (identified cost $8,307) 131,870
------------
Warrants--0.0%
Indonesia--0.0%
109,374 (1)PT Bank Dagang Nasional Indonesia 0
131,754 (1)PT Bank Internasional Indonesia 340
109,284 (1)PT Bank Pan Indonesia 4,035
163,544 (1)Indah Kiat Pulp & Paper Corp. 50,321
------------
Total 54,696
------------
Philippines--0.0%
500,000 (1)Belle Corp. 1,248
------------
Thailand--0.0%
9,375 (1)Thai Farmers Bank Co. 1,466
------------
Total Warrants (identified cost $19,946) 57,410
------------
Convertible Bonds--0.0%
Brazil--0.0%
$ 53,500 Companhia Vale do Rio Doce, Conv. Deb., 12/31/1999
(identified cost $417) 309
------------
Closed-End Investment Companies--5.7%
Bulgaria--0.2%
65,000 Framlington Bulgaria Fund 300,625
------------
India--2.0%
35,000 India Fund Inc. 304,063
20,000 India Investment Trust Fund 497,500
300,000 (1)The Morgan Stanley India Investment Fund, Inc. 2,531,250
------------
Total 3,332,813
------------
Korea, Republic of--1.1%
800 Korea Europe Fund, GDR 1,840,000
------------
Romania--0.5%
2,200 (1)Romanian Investment Fund Ltd. 825,000
------------
South Africa--1.2%
20,000 ASA Ltd. 330,000
150,000 Southern Africa Fund, Inc. 1,668,750
------------
Total 1,998,750
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Emerging Markets Fund
<TABLE>
<CAPTION>
Value in
Shares U.S. Dollars
<C> <S> <C>
- ----------------------------------------------------------------------------
Closed-End Investment Companies--continued
Taiwan, Republic of
China--0.6%
50,000 Taiwan Fund, Inc. $ 740,625
50,000 ROC Taiwan Fund 346,875
------------
Total 1,087,500
------------
Ukraine--0.1%
6,667 (1)Societe Generale Ukraine Fund 270,014
------------
Total Closed-End Investment Companies (identified
cost $10,284,697) 9,654,702
------------
</TABLE>
<TABLE>
<CAPTION>
Shares or
Principal Value in
Amount U.S. Dollars
<C> <S> <C>
- -------------------------------------------------------------------------------
Open-End Investment Company--2.6%
United States--2.6%
4,546,846 Bank of New York Co., Inc. (at market value) $ 4,546,846
------------
(3) Repurchase Agreement--1.3%
United States--1.3%
$2,142,176 Goldman Sachs Group, LP, 4.50%, dated 5/28/1999, due
6/1/1999 (at amortized cost) 2,142,176
------------
Total Investments (identified cost $156,231,226) $168,825,599
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Balanced Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Shares Value
- ----------------------------------------------------------------------------
<C> <S> <C>
Common Stocks--53.7%
Basic Materials--2.6%
27,132 Air Products & Chemicals, Inc. $ 1,112,412
44,601 Du Pont (E.I.) de Nemours & Co. 2,918,578
14,661 Potash Corporation of Saskatchewan, Inc. 797,192
53,349 Rohm & Haas Co. 2,140,629
45,984 Weyerhaeuser Co. 2,853,882
------------
Total 9,822,693
------------
Capital Goods--4.1%
52,094 General Electric Co. 5,297,309
30,307 Ingersoll-Rand Co. 1,930,177
47,314 Tyco International Ltd. 4,134,061
50,798 United Technologies Corp. 3,152,651
21,447 Waste Management, Inc. 1,134,010
------------
Total 15,648,208
------------
Communication Services--4.0%
78,197 AT&T Corp. 4,339,906
12,780 (1)Airtouch Communications, Inc. 1,284,390
86,345 (1)MCI Worldcom, Inc. 7,458,049
51,704 (1)Qwest Communications International, Inc. 2,194,188
------------
Total 15,276,533
------------
Consumer Cyclical--3.5%
32,374 Black & Decker Corp. 1,843,295
13,931 Carnival Corp. 571,171
32,740 Lowe's Cos., Inc. 1,700,434
16,424 Magna International, Inc., Class A 994,678
47,644 McGraw-Hill Cos., Inc. 2,471,532
43,736 Nordstrom, Inc. 1,552,628
17,895 Tandy Corp. 1,476,337
64,376 Wal-Mart Stores, Inc. 2,744,027
------------
Total 13,354,102
------------
Consumer Staples--6.7%
12,355 (1)AT&T Corp.-Liberty Media Group, Inc., Class A 820,835
24,059 Avon Products, Inc. 1,189,417
52,879 CBS Corp. 2,207,698
34,269 CVS Corp. 1,576,374
30,969 (1)Clear Channel Communications, Inc. 2,045,890
36,878 Coca-Cola Enterprises, Inc. 1,336,827
64,324 Comcast Corp., Class A 2,476,474
</TABLE>
<TABLE>
<CAPTION>
Shares Value
- -------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Consumer Staples--continued
41,075 (1)Kroger Co., Inc. $ 2,405,455
31,224 (1)Outback Steakhouse, Inc. 1,120,179
39,420 PepsiCo, Inc. 1,411,729
34,465 Procter & Gamble Co. 3,218,169
36,418 (1)Safeway, Inc. 1,693,437
62,043 Time Warner, Inc. 4,222,802
------------
Total 25,725,286
------------
Energy--2.5%
13,881 BP Amoco PLC, ADR 1,487,002
21,014 Chevron Corp. 1,947,735
52,968 Conoco, Inc., Class A 1,436,757
44,226 Exxon Corp. 3,532,552
20,503 Schlumberger Ltd. 1,234,024
------------
Total 9,638,070
------------
Finance--10.4%
34,403 American Express Co. 4,169,214
12,294 American General Corp. 888,242
37,480 American International Group, Inc. 4,284,432
25,513 Associates First Capital Corp., Class A 1,046,033
37,331 Bank One Corp. 2,111,535
57,279 Bank of America Corp. 3,705,235
24,246 Bank of New York Co., Inc. 866,794
35,619 Chase Manhattan Corp. 2,582,377
87,606 Citigroup, Inc. 5,803,897
21,441 Fannie Mae 1,457,988
43,942 Freddie Mac 2,562,368
21,932 First Union Corp. 1,010,243
21,920 MBIA, Inc. 1,497,410
44,174 MBNA Corp. 1,220,307
15,130 Marsh & McLennan Cos., Inc. 1,100,707
11,437 Merrill Lynch & Co., Inc. 960,708
29,985 SunTrust Banks, Inc. 2,023,987
65,262 Wells Fargo Co. 2,610,480
------------
Total 39,901,957
------------
Healthcare--6.3%
41,479 Abbott Laboratories 1,874,332
44,450 American Home Products Corp. 2,561,431
45,468 Bristol-Myers Squibb Co. 3,120,242
6,298 (1)Elan Corp. PLC, ADR 340,092
26,336 Johnson & Johnson 2,439,372
31,312 Lilly (Eli) & Co. 2,236,851
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Balanced Fund
<TABLE>
<CAPTION>
Shares or
Principal
Amount Value
- ------------------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Healthcare--continued
11,060 Medtronic, Inc. $ 785,260
46,643 Merck & Co., Inc. 3,148,403
32,325 Pfizer, Inc. 3,458,775
31,859 Pharmacia & Upjohn, Inc. 1,766,183
21,982 Schering Plough Corp. 990,564
23,987 Warner-Lambert Co. 1,487,194
------------
Total 24,208,699
------------
Technology--11.7%
27,784 (1)America Online, Inc. 3,316,715
16,828 (1)Applied Materials, Inc. 924,488
20,507 (1)Ascend Communications, Inc. 1,900,743
49,982 (1)Cisco Systems, Inc. 5,448,093
23,795 (1) Dell Computer Corp. 819,440
27,227 (1) EMC Corp. 2,712,490
68,880 Intel Corp. 3,723,825
42,642 International Business Machines Corp. 4,959,798
22,711 Lucent Technologies, Inc. 1,291,688
97,309 (1)Microsoft Corp. 7,851,620
17,604 Nokia Oyj, Class A, ADR 1,249,884
57,986 (1)Sun Microsystems, Inc. 3,464,664
28,612 Texas Instruments, Inc. 3,129,438
13,866 (1)Uniphase Corp. 1,858,044
27,922 (1)Veritas Software Corp. 2,464,117
------------
Total 45,115,047
------------
Transportation--0.8%
57,697 Burlington Northern Santa Fe 1,788,607
44,604 Southwest Airlines Co. 1,430,116
------------
Total 3,218,723
------------
Utilities--1.1%
17,921 Duke Energy Corp. 1,080,860
28,536 Enron Corp. 2,036,757
41,136 Southern Co. 1,167,234
------------
Total 4,284,851
------------
Total Common Stocks (identified cost $148,898,662) 206,194,169
------------
Corporate Bonds--13.9%
Asset Backed Securities--0.8%
$ 1,000,000 American Express Credit Account Master Trust 1997-
1, Class A, 6.40%, 4/15/2005 1,005,930
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Corporate Bonds--continued
Asset Backed Securities--continued
$ 1,250,000 DLJ Commercial Mortgage Corp. 1999-CG1, Class A1B,
6.46%, 1/10/2009 $ 1,226,550
575,000 Ford Credit Auto Owner Trust 1999-B, Class A4,
5.80%, 6/15/2002 573,741
226,926 Prudential Home Mortgage Securities 1993-60, Class
A1, 6.75%, 12/25/2023 227,564
------------
Total 3,033,785
------------
Basic Materials--0.2%
800,000 Nalco Chemical Co., Bond, 6.25%, 5/15/2008 763,016
------------
Communication Services--1.4%
1,550,000 AT&T Corp., Global Bond, 6.00%, 3/15/2009 1,484,497
3,980,000 New York Telephone Co., Deb., 6.00%, 4/15/2008 3,809,258
------------
Total 5,293,755
------------
Consumer Cyclical--1.3%
2,000,000 Tribune Co., Note, 6.25%, 11/10/2026 1,982,760
3,000,000 Wal-Mart Stores, Inc., Note, 5.85%, 6/1/2000 3,007,440
------------
Total 4,990,200
------------
Consumer Staples--0.2%
750,000 Archer-Daniels-Midland Co., Note, 6.625%, 5/1/2029 702,878
------------
Finance--8.7%
2,500,000 Aon Capital Trust A, Company Guarantee, 8.205%,
1/1/2027 2,714,725
1,100,000 Associates Corp. of North America, Sr. Note, 6.50%,
7/15/2002 1,105,863
865,000 Bankers Trust Corp., Sub. Note, 7.375%, 5/1/2008 887,784
2,000,000 CIT Group, Inc., Sr. Note, 6.375%, 10/1/2002 1,996,380
2,250,000 Caterpillar Financial Services Corp., Note, 6.50%,
2/1/2002 2,265,053
3,000,000 Chase Manhattan Corp., Sr. Note, 5.15%, 12/15/2000 2,962,560
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Balanced Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Corporate Bonds--continued
Finance--continued
$ 1,000,000 First Union National Bank, 6.36%, 6/15/2008 $ 993,030
890,000 Ford Motor Credit Corp., Sr. Unsub., 6.55%,
9/10/2002 895,767
1,000,000 Hartford Life, Inc., Note, 7.10%, 6/15/2007 1,010,810
825,000 Household Finance Corp., Note, 6.00%, 5/1/2004 803,492
2,750,000 IBM Credit Corp., Sr. Note, 5.79%, 3/20/2010
(Callable 3/20/2000 @ 100) 2,756,298
1,500,000 KFW International Finance, Note, 7.00%, 3/1/2013 1,543,635
735,000 Landeskreditbank B-W, Sub. Note, 7.875%, 4/15/2004 775,601
2,000,000 Lehman Brothers Holdings, Inc., Bond, 6.20%,
1/15/2002 1,971,400
2,500,000 Merrill Lynch & Co., Inc., Bond, 6.00%, 7/15/2005 2,426,050
1,000,000 Morgan Stanley, Dean Witter & Co., Sr. Note, Series
MTNC, 5.875%, 2/28/2001 996,940
1,000,000 NationsBank Corp., MTN, 6.94%, 4/12/2002 1,017,370
3,500,000 Norwest Financial, Inc., Sr. Note, 6.375%,
9/15/2002 3,504,550
1,365,000 Sears Roebuck Acceptance Corp., MTN, 7.03%,
6/4/2003 1,392,737
1,550,000 Union Planters Corp., Sub. Note, 6.50%, 3/15/2018 1,492,526
------------
Total 33,512,571
------------
Industrial Services--0.5%
2,000,000 WMX Technologies, Inc., Note, 8.00%, 4/30/2004 2,118,640
------------
Telecommunications--0.8%
1,660,000 National Fuel Gas Co., Note, 6.303%, 5/27/2008 1,597,418
1,500,000 Ontario Hydro, Sr. Note, 6.10%, 1/30/2008 1,454,595
------------
Total 3,052,013
------------
Total Corporate Bonds (identified cost $54,034,069) 53,466,858
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
- --------------------------------------------------------------------------
<C> <S> <C>
Mortgage Backed Securities--13.8%
Federal Home Loan Mortgage Corporation--0.3%
$ 157,662 6.50%, 12/1/2008 $ 157,648
37,587 6.50%, 2/1/2009 37,584
504,718 6.50%, 3/1/2009 504,692
40,919 6.50%, 4/1/2009 40,917
198,578 6.50%, 6/1/2009 198,568
209,336 6.50%, 7/1/2010 209,334
------------
Total 1,148,743
------------
Federal National Mortgage Association--8.2%
734,390 6.00%, 12/1/2010 717,867
1,224,646 6.00%, 4/1/2011 1,197,092
5,415,910 6.00%, 12/1/2012 5,283,870
1,736,351 6.00%, 1/1/2013 1,694,019
1,709,481 6.11%, 9/1/2008 1,675,582
1,114,570 6.50%, 1/1/2028 1,089,135
7,864,202 6.50%, 2/1/2029 7,684,741
2,200,000 6.50%, 6/1/2099 2,149,796
3,250,000 6.57%, 8/22/2007 3,301,805
250,000 7.16%, 5/11/2005 261,093
4,920,000 7.375%, 3/28/2005 5,185,237
86,912 7.50%, 4/1/2007 89,275
475,826 7.50%, 9/1/2022 486,232
112,237 8.00%, 6/1/2022 116,972
172,887 8.00%, 1/1/2023 179,965
21,726 8.50%, 8/1/2016 22,885
22,469 8.50%, 6/1/2024 23,578
191,053 8.50%, 7/1/2024 200,545
12,397 8.50%, 10/1/2024 13,009
251,946 8.50%, 12/1/2024 264,384
------------
Total 31,637,082
------------
Government National Mortgage Association--4.7%
7,142,518 6.00%, 2/15/2029 6,770,038
4,324,481 6.00%, 3/15/2029 4,098,786
710,784 6.50%, 10/15/2008 711,310
944,798 6.50%, 12/15/2012 944,798
2,527,732 6.50%, 2/15/2013 2,527,732
549,078 7.00%, 5/15/2023 550,275
1,468,235 7.00%, 8/15/2023 1,471,436
665,295 7.00%, 12/20/2025 663,013
316,934 7.50%, 3/15/2023 324,658
------------
Total 18,062,046
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Balanced Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- ------------------------------------------------------------------------------
<C> <S> <C>
Mortgage Backed Securities--continued
Tennessee Valley Authority--0.6%
$ 2,200,000 Tennessee Valley Authority, Bond, 5.28%, 9/14/2001 $ 2,180,750
------------
Total Mortgage Backed Securities (identified cost
$54,036,483) 53,028,621
------------
(2) U.S. Treasury Obligations--11.4%
U.S. Treasury Bill--0.5%
2,000,000 6/17/1999 1,996,080
------------
U.S. Treasury Bonds--4.4%
3,000,000 6.125%, 11/15/2027 3,035,160
12,234,000 7.125%, 2/15/2023 13,801,420
------------
Total 16,836,580
------------
U.S. Treasury Notes--6.5%
9,000,000 5.50%, 5/31/2000 9,025,290
8,000,000 5.875%, 11/15/2005 8,037,520
1,000,000 6.50%, 8/15/2005 1,036,560
3,500,000 6.50%, 10/15/2006 3,641,085
2,955,000 7.875%, 11/15/2004 3,244,029
------------
Total 24,984,484
------------
Total U.S. Treasury Obligations (identified cost
$45,310,289) 43,817,144
------------
</TABLE>
<TABLE>
<CAPTION>
Shares or
Principal
Amount Value
- -----------------------------------------------------------------------------
<C> <S> <C>
Closed-End Investment Companies--1.4%
233,301 Blackrock 2001 Term Trust, $ 2,114,290
164,200 Blackrock Strategic Term Trust 1,518,850
97,211 Blackrock Target Term Trust 947,807
153,700 Templeton Global Income Fund 1,008,656
------------
Total Closed-End Investment Companies (identified
cost $5,335,944) 5,589,603
------------
(3) Repurchase Agreement--5.6%
$21,342,538 Goldman Sachs Group, LP, 4.50%, dated 5/28/1999,
due 6/1/1999 (at amortized cost) 21,342,538
------------
Total Investments (identified cost $328,957,985) $383,438,933
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Fixed Income Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Asset-Backed Securities--6.9%
Banking & Finance--0.7%
$ 2,000,000 First Union National Bank, 6.36% 6/15/2008 $ 1,986,060
------------
Finance--6.2%
3,575,000 American Express Credit Account Master Trust 1997- 1, Class A,
6.40%, 4/15/2005 3,596,200
2,300,000 Circuit City Credit Card Master Trust 1995-1, Class
A, 6.34%, 8/15/2005 2,321,574
3,250,000 Distribution Financial Services RV Trust 1999-1, Class A5, 5.97%,
8/15/2013 3,225,170
2,500,000 DLJ Commercial Mortgage Corp. 1999-CG1, Class A1B,
6.46%, 1/10/2009 2,453,100
1,885,000 First USA Credit Card Master Trust 1997-6, Class A,
6.42%, 3/17/2005 1,899,138
3,975,000 Ford Credit Auto Owner Trust 1999-B, Class A4,
5.80%, 6/15/2002 3,966,295
------------
Total 17,461,477
------------
Total Asset-Backed Securities (identified cost
$19,560,624) 19,447,537
------------
Collateralized Mortgage Obligations--3.1%
Finance--3.1%
2,000,000 Commercial Mortgage Asset Trust, Series 1999-C1,
Class C, 7.35%, 8/17/2013 1,905,960
2,000,000 Criimi Mae CMBS Corp., Series 1998-1, Class A2,
6.01%, 2/20/2005 1,903,120
1,275,000 Deutsche Mortgage and Asset Receiving Corp., Series 1998-C1, Class
D, 7.23%, 6/15/2031 1,155,163
14,038,228 Deutsche Mortgage and Asset Receiving Corp., Series 1998-C1, Class
X, 1.25%, 2/15/2023 789,650
36,042,586 Nomura Asset Securities Corp., Series 1998-D6,
Class ACS1, 1.65%, 3/17/2028 1,074,898
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
- ------------------------------------------------------------------------------
<C> <S> <C>
Collateralized Mortgage Obligations--continued
Finance--continued
$ 2,000,000 Nomura Asset Securities Corp., Series 1998-D6,
Class A3, 6.98%, 3/17/2028 $ 1,935,220
------------
Total Collateralized Mortgage Obligations
(identified cost $9,299,713) 8,764,011
------------
Corporate Bonds--27.1%
Banking & Finance--1.7%
1,340,000 BB&T Corp., Sub. Note, 7.25%, 6/15/2007 1,360,127
2,135,000 Landeskreditbank B-W, Sub. Note, 7.88%, 4/15/2004 2,252,937
1,250,000 NationsBank Corp., 6.13%, 7/15/2004 1,229,775
------------
Total 4,842,839
------------
Basic Materials--0.4%
1,000,000 Du Pont (E.I.) de Nemours & Co., Unsecd. Note,
Series G, 6.47%, 9/26/2002 1,012,060
------------
Communication Services--1.2%
2,350,000 AT&T Corp., Global Bond, 6.00%, 3/15/2009 2,250,689
1,200,000 Sprint Capital Corp., Company Guarantee, 6.88%,
11/15/2028 1,124,124
------------
Total 3,374,813
------------
Finance--19.9%
2,135,000 Abbey National Bank PLC, London, Sub., 6.69%,
10/17/2005 2,119,265
1,000,000 American Express Co., 12/12/2000 904,222
1,000,000 Bankers Trust Corp., Sr. Note, 6.75%, 10/3/2001 1,011,390
1,880,000 Bankers Trust Corp., Sub. Note, 7.375%, 5/1/2008 1,929,519
4,000,000 BankUnited Financial Corp., Note, 5.40%, 2/2/2004 3,828,280
1,250,000 Bear Stearns Cos., Inc., Sr. Note, 6.70%, 8/1/2003 1,247,837
2,000,000 Caterpillar Financial Services Corp., Note, 6.50%,
2/1/2002 2,013,380
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Fixed Income Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Corporate Bonds--continued
Finance--continued
$ 3,000,000 Distribution Financial Services RV Trust, Series
1992-2, Class A4, 6.48%, 10/15/2013 $ 2,985,240
755,000 First Union Corp., Sub. Note, 6.824%, 8/1/2026 783,931
3,000,000 Hanson Overseas B.V., Sr. Note, 7.375%, 1/15/2003 3,094,950
3,750,000 IBM Credit Corp., Sr. Note, 5.79%, 3/20/2010
(Callable 3/20/2000 @ 100) 3,758,587
2,000,000 Inter-American Development Bank, Deb., 8.88%,
6/1/2009 2,366,180
2,145,000 International Lease Finance Corp., Note, 5.625%,
4/15/2002 2,111,645
2,665,000 Lehman Brothers Holdings, Inc., Note, 6.90%,
3/30/2001 2,684,774
1,000,000 Lehman Brothers Holdings, Inc., Sr. Note, 8.75%,
3/15/2005 1,077,810
1,375,000 Mercantile Bancorporation, Inc., 6.80%, 6/15/2001 1,390,689
2,000,000 Merrill Lynch & Co., Inc., Bond, 6.00%, 7/15/2005 1,940,840
1,100,000 Metropolitan Life Insurance Co., 7.00%, 11/1/2005 1,098,086
2,090,000 Morgan Stanley Group, Inc., Note, 6.88%, 3/1/2007 2,099,990
2,250,000 National Rural Utilities Cooperative Finance Corp.,
Collateral Trust, 5.75%, 11/1/2008 2,114,865
2,100,000 Salomon, Inc., Note, 6.38%, 10/1/2004 2,080,785
4,250,000 Smithkline Beecham Corp., Company Guarantee, 6.75%,
9/5/2000 4,296,546
2,200,000 Union Planters Corp., Sub. Note, 6.50%, 3/15/2018 2,118,424
2,000,000 Wells Fargo Co., Sr. Note, Series H, 6.75%,
6/15/2007 2,005,840
2,615,000 World Bank, Note, 5.00%, 11/28/2000 2,580,856
3,000,000 Xerox Capital Trust I, Company Guarantee, 8.00%,
2/1/2027 3,089,670
------------
Total 56,733,601
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Corporate Bonds--continued
Machinery & Equipment--0.9%
$ 2,670,000 Ingersoll-Rand Co., Note, 6.13%, 11/18/2027 $ 2,657,611
------------
Producer Manufacturing--0.1%
240,000 Armstrong World Industries, Inc., Deb., 9.75%,
4/15/2008 279,187
------------
Retail Trade--0.8%
840,000 Archer-Daniels-Midland Co., Note, 6.63%, 5/1/2029 787,223
1,405,000 Penney (J.C.) Co., Inc., Note, 7.60%, 4/1/2007 1,435,784
------------
Total 2,223,007
------------
Utilities--2.1%
3,000,000 National Fuel Gas Co., Note, 6.30%, 5/27/2008 2,886,900
1,135,000 Ontario Hydro, Sr. Note, 6.10%, 1/30/2008 1,100,644
2,000,000 SCANA Corp., Sr. Note, Series B, 6.25%, 7/8/2003 1,987,200
------------
Total 5,974,744
------------
Total Corporate Bonds (identified cost $78,662,135) 77,097,862
------------
Foreign Bonds--0.7%
Finance--0.7%
1,000,000 Israel AID, 5.63%, 9/15/2003 979,330
1,005,000 Province of Manitoba, 9.00%, 12/15/2000 1,050,305
------------
Total Foreign Bonds (identified cost $2,032,807) 2,029,635
------------
U.S. Government Agencies--37.9%
Federal Farm Credit
Bank--0.6%
1,700,000 5.73%, 7/28/2003 1,681,402
------------
Federal Home Loan
Bank--4.3%
4,300,000 5.765%, 6/11/2003 4,259,021
2,000,000 5.720%, 8/25/2003 1,976,880
1,500,000 5.625%, 6/2/2000 1,503,045
4,550,000 5.625%, 3/19/2001 4,542,174
------------
Total 12,281,120
------------
Federal Home Loan Mortgage Corporation--2.7%
2,091 12.50%, 2/1/2010 2,342
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Fixed Income Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -----------------------------------------------------------------------------
<C> <S> <C>
U.S. Government Agencies--continued
Federal Home Loan Mortgage Corporation--continued
$ 6,780 12.50%, 7/1/2011 $ 7,625
2,932 12.50%, 3/1/2014 3,314
1,541 11.00%, 10/1/2010 1,681
9,965 11.00%, 10/1/2015 10,898
16,393 9.50%, 7/1/2016 17,400
1,641 9.50%, 2/1/2019 1,747
6,539 9.00%, 5/15/2016 7,005
2,140 9.00%, 1/1/2019 2,273
5,568 8.50%, 7/1/2017 5,890
1,056 8.50%, 8/1/2017 1,116
15,406 8.00%, 1/1/2008 15,972
10,275 8.00%, 12/1/2008 10,596
531 8.00%, 1/1/2009 550
5,230 8.00%, 2/1/2009 5,394
31,977 8.00%, 4/1/2009 33,072
1,177 8.00%, 7/1/2017 1,234
1,357 8.00%, 1/1/2019 1,424
30,346 7.50%, 9/1/2007 31,228
500,519 7.50%, 2/1/2023 511,936
511,621 7.00%, 6/1/2008 519,081
499,175 6.50%, 4/1/2009 499,150
1,359,456 6.50%, 11/1/2011 1,356,479
1,772,048 6.50%, 8/1/2013 1,765,952
3,000,000 5.75%, 7/15/2003 2,973,270
------------
Total 7,786,629
------------
Federal National Mortgage Association--20.0%
184 12.50%, 9/1/2013 208
1,596 9.50%, 7/1/2016 1,705
307 9.00%, 1/1/2017 326
150 8.50%, 2/1/2019 158
2,494 8.00%, 11/1/2008 2,579
4,960 8.00%, 1/1/2009 5,141
22,721 8.00%, 9/1/2009 23,552
438,449 7.50%, 1/1/2023 448,121
814,260 7.50%, 5/1/2026 831,059
2,606,686 7.00%, 11/1/2028 2,608,302
5,236,234 6.50%, 9/1/2012 5,213,299
1,811,649 6.50%, 7/1/2013 1,803,714
2,400,000 6.50%, 1/25/2014 2,373,744
2,482,290 6.50%, 1/1/2028 2,425,644
15,885,687 6.50%, 2/1/2029 15,523,176
2,948,819 6.50%, 3/1/2029 2,881,527
4,000,000 6.50%, 6/1/2099 3,908,720
2,968,074 6.29%, 4/1/2008 2,940,255
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
- ----------------------------------------------------------------------------
<C> <S> <C>
U.S. Government Agencies--continued
Federal National Mortgage Association--continued
$ 993,069 6.20%, 9/1/2008 $ 977,736
1,974,511 6.10%, 3/1/2008 1,933,377
2,520,931 6.10%, 8/1/2008 2,466,441
882,846 6.00%, 1/1/2009 867,114
1,372,681 6.00%, 4/1/2011 1,341,795
7,478,652 6.00%, 4/1/2013 7,296,323
900,000 5.44%, 1/29/2001 896,481
------------
Total 56,770,497
------------
Government National Mortgage Association--10.3%
6,575 11.00%, 9/15/2015 7,266
1,130 11.00%, 11/15/2015 1,254
1,247 10.50%, 10/15/2000 1,283
1,027 10.50%, 11/15/2000 1,057
11,727 10.50%, 8/15/2017 12,753
13,200 9.50%, 5/15/2016 14,189
25,104 9.50%, 6/15/2016 26,987
9,426 9.50%, 7/15/2016 10,133
106,623 9.50%, 12/15/2016 114,619
12,000 9.50%, 9/15/2017 12,899
10,030 9.50%, 10/15/2017 10,780
1,556 9.50%, 7/15/2018 1,673
43,193 9.50%, 4/15/2020 46,410
11,663 9.50%, 6/15/2020 12,532
26,011 9.50%, 9/15/2020 27,948
59,797 9.50%, 10/15/2020 64,250
16,135 9.50%, 11/15/2020 17,337
22,482 9.00%, 5/15/2016 24,124
22,390 9.00%, 6/15/2016 23,982
8,155 9.00%, 7/15/2016 8,736
1,185 9.00%, 8/15/2016 1,270
60,983 9.00%, 9/15/2016 65,326
38,333 9.00%, 10/15/2016 41,065
21,764 9.00%, 11/15/2016 23,396
2,168 9.00%, 12/15/2016 2,322
101,334 9.00%, 1/15/2017 108,642
10,133 9.00%, 5/15/2017 10,853
7,533 9.00%, 6/15/2017 8,095
295 9.00%, 7/15/2017 316
3,020 9.00%, 4/15/2018 3,243
21,595 9.00%, 5/15/2018 23,197
12,497 9.00%, 6/15/2018 13,424
25,218 9.00%, 10/15/2019 27,078
14,651 9.00%, 11/15/2019 15,732
23,129 9.00%, 12/15/2019 24,834
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Fixed Income Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
U.S. Government Agencies--continued
Government National Mortgage Association--continued
$ 18,358 9.00%, 1/15/2020 $ 19,700
20,014 9.00%, 11/15/2020 21,477
102,558 9.00%, 1/15/2021 109,992
14,599 8.50%, 5/15/2016 15,507
94,442 8.50%, 6/15/2016 100,314
7,092 8.50%, 7/15/2016 7,533
4,147 8.50%, 6/15/2017 4,402
1,368 8.50%, 9/15/2017 1,452
24,881 8.50%, 5/15/2021 26,334
9,150 8.50%, 9/15/2021 9,684
100,887 8.50%, 11/15/2021 106,783
32,544 8.50%, 12/15/2021 34,446
3,185 8.50%, 4/15/2022 3,371
61,178 8.50%, 5/15/2022 64,753
33,096 8.50%, 6/15/2022 35,030
8,563 8.00%, 2/15/2017 8,957
7,571 8.00%, 6/15/2017 7,918
96,584 8.00%, 4/15/2022 100,719
225,620 8.00%, 5/15/2022 235,279
188,335 8.00%, 9/15/2022 196,398
189,735 7.50%, 2/15/2022 194,359
154,516 7.50%, 8/15/2022 158,281
116,085 7.50%, 10/15/2022 118,914
103,639 7.50%, 11/15/2022 106,165
396,209 7.50%, 12/15/2022 405,864
196,627 7.50%, 2/15/2023 201,419
55,420 7.50%, 3/15/2023 56,771
661,902 7.50%, 1/15/2024 677,827
610,055 7.00%, 6/15/2023 611,385
1,030,945 6.50%, 5/15/2009 1,031,800
674,361 6.50%, 5/15/2011 674,780
2,290,032 6.50%, 4/15/2024 2,240,659
9,938,461 6.50%, 1/15/2029 9,693,080
3,496,371 6.50%, 3/15/2029 3,410,046
1,058,889 6.00%, 5/15/2009 1,042,339
6,973,383 6.00%, 1/15/2029 6,609,443
------------
Total 29,152,186
------------
Total U.S. Government Agencies (identified cost
$109,533,157) 107,671,834
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount
or Shares Value
- -----------------------------------------------------------------------------
<C> <S> <C>
U.S. Treasury Obligations--12.6%
United States Treasury Note--3.2%
$ 550,000 5.375%, 2/15/2001 $ 549,653
4,500,000 5.75%, 8/15/2003 4,509,135
4,000,000 5.875%, 11/15/2005 4,018,760
------------
Total 9,077,548
------------
U.S. Treasury Bonds--9.4%
5,600,000 6.125%, 11/15/2027 5,665,632
19,400,000 6.75%, 8/15/2026 21,158,028
------------
Total 26,823,660
------------
Total U.S. Treasury Obligations (identified cost
$37,426,902) 35,901,208
------------
Closed-End Investment Companies--7.1%
153,200 2002 Target Term Trust, Inc. 2,183,100
222,100 Blackrock 1999 Term Trust 2,221,000
357,200 Blackrock 2001 Term Trust, Inc. 3,237,125
387,800 Blackrock Strategic Term Trust, Inc. 3,587,150
548,500 Blackrock Target Term Trust 5,347,875
157,600 RCM Strategic Global Government Fund 1,536,600
296,300 Templeton Global Income Fund 1,944,469
------------
Total Closed-End Investment Companies (identified
cost $19,101,780) 20,057,319
------------
(3) Repurchase Agreement--5.4%
$15,446,707 Goldman Sachs Group, LP, 4.50%, dated 5/28/1999,
due 6/1/1999 (at amortized cost) 15,446,707
------------
Total Investments (identified cost $291,063,825) $286,416,113
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Intermediate Fixed Income Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Asset-Backed Securities--10.1%
Banking & Finance--1.2%
$ 1,000,000 First Union National Bank, 1999-C2, Class A1, 6.36%,
6/15/2008 $ 993,030
-----------
Finance--8.9%
760,000 DLJ Commercial Mortgage Corp. 1999-CG1, Class A1B,
6.46%, 1/10/2009 745,742
1,135,000 Discover Card Master Trust I 1998-7, Class A, 5.60%,
5/16/2006 1,108,089
1,475,000 Distribution Financial Services RV Trust, 1999-1,
Class A5, 5.97%, 8/15/2013 1,463,731
2,000,000 Heller Equipment Asset Receivables Trust 1999-1, Class A4, 5.62%,
12/13/2004 1,959,280
2,140,000 Premier Auto Trust 1998-1, Class A4, 5.70%,
10/6/2002 2,131,975
-----------
Total 7,408,817
-----------
Total Asset-Backed Securities (identified cost
$8,541,030) 8,401,847
-----------
Collateralized Mortgage Obligations--0.4%
10,410,550 Nomura Asset Securities Corp. 1998-D6, Class ACS1,
1.65%, 3/17/2028 (identified cost $310,474) 310,474
-----------
Corporate Bonds--34.8%
Basic Materials--1.2%
1,000,000 Monsanto Co., Note, 6.00%, 7/1/2000 1,002,320
-----------
Communication Services--1.0%
900,000 AT&T Corp., Global Bond, 6.00%, 3/15/2009 861,966
-----------
Consumer Cyclical--1.2%
1,000,000 Ford Motor Co., Note, 7.25%, 10/1/2008 1,029,680
-----------
Consumer Non-Durables--1.2%
1,000,000 Philip Morris Cos., Inc., 7.65%, 7/1/2008 1,040,880
-----------
Finance--13.6%
1,000,000 BankBoston, N.A., Sub. Note, 6.50%, 12/19/2007 969,960
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Corporate Bonds--continued
Finance--continued
$ 1,000,000 CIGNA Corp., Note, 7.40%, 5/15/2007 $ 1,021,370
2,350,000 Ford Motor Credit Corp., Unsecd. Note, 6.25%,
11/8/2000 2,360,176
1,000,000 J.P. Morgan & Co., Inc., Sub. Note, 6.00%, 1/15/2009 937,110
1,000,000 J.P. Morgan & Co., Inc., Sub. Note, 7.625%,
9/15/2004 1,047,050
1,000,000 Morgan Guaranty Trust Co., New York, 5.75%,
10/8/1999 1,000,390
1,000,000 Pitney Bowes Credit Corp., MTN, 6.78%, 7/16/2001 1,013,630
1,000,000 Sears Roebuck Acceptance Corp., 6.95%, 5/15/2002 1,018,310
1,000,000 State Street Boston Corp., 5.95%, 9/15/2003 974,560
1,000,000 Union Planters Corp., Sub. Note, 6.50%, 3/15/2018 962,920
-----------
Total 11,305,476
-----------
Financial Services--8.4%
2,000,000 CIT Group, Inc., Sr. Note, 5.80%, 3/26/2002 1,971,840
1,000,000 Lehman Brothers Holdings, Inc., Note, 6.89%,
10/10/2000 1,009,730
1,000,000 Lehman Brothers Holdings, Inc., Note, 7.375%,
5/15/2004 1,010,240
1,000,000 Merrill Lynch & Co., Inc., Note, 6.00%, 2/12/2003 986,130
1,000,000 Merrill Lynch & Co., Inc., Bond, 6.00%, 7/15/2005 970,420
1,000,000 Salomon, Inc., Sr. Note, 7.30%, 5/15/2002 1,024,990
-----------
Total 6,973,350
-----------
Healthcare--1.2%
1,000,000 Bristol-Myers Squibb Co., Deb., 6.80%, 11/15/2026 989,520
-----------
Recreation--3.0%
2,500,000 Disney (Walt) Co., Bond, Series B, 6.75%, 3/30/2006 2,518,850
-----------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Intermediate Fixed Income Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- ------------------------------------------------------------------------------
<C> <S> <C>
Corporate Bonds--continued
Retail--1.5%
$ 265,000 Archer-Daniels-Midland Co., Note, 6.625%, 5/1/2029 $ 248,350
1,000,000 Wal-Mart Stores, Inc., Note, 5.875%, 10/15/2005 972,430
-----------
Total 1,220,780
-----------
Transportation--2.5%
1,000,000 Burlington Northern, Inc., Equip. Trust, Series
96AA, 7.46%, 9/24/2011 1,036,770
1,000,000 CSX Corp., Deb., 7.05%, 5/1/2002 1,012,390
-----------
Total 2,049,160
-----------
Total Corporate Bonds (identified cost $28,983,259) 28,991,982
-----------
U.S. Government Agencies--37.5%
Federal Farm Credit--2.4%
2,080,000 5.750%, 9/1/2005 2,028,000
-----------
Federal Home Loan Bank
System--1.2%
1,000,000 5.280%, 1/6/2004 965,780
-----------
Federal National Mortgage Association--26.5%
2,986,736 7.000%, 9/1/2027 2,988,588
150,000 6.550%, 9/12/2005 152,367
1,200,000 6.500%, 12/1/1999 1,172,616
3,330,529 6.500%, 7/1/2013 3,315,941
3,809,065 6.500%, 8/1/2028 3,722,143
4,423,613 6.500%, 2/1/2029 4,322,667
2,625,000 6.350%, 6/10/2005 2,640,986
3,857,267 6.000%, 8/1/2013 3,763,227
-----------
Total 22,078,535
-----------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount
or Shares Value
- -------------------------------------------------------------------------------
<C> <S> <C>
U.S. Government Agencies--continued
Government National Mortgage Association--7.4%
$ 4,033,980 6.000%, 2/15/2029 $ 3,823,610
2,442,398 6.000%, 3/15/2029 2,314,929
-----------
Total 6,138,539
-----------
Total U.S. Government Agencies (identified cost
$31,884,588) 31,210,854
-----------
U.S. Treasury Obligations--11.8%
United States Treasury
Bonds--11.8%
3,470,000 6.125%, 11/15/2027 3,510,668
1,600,000 7.125%, 2/15/2023 1,804,992
1,175,000 7.250%, 5/15/2016 1,314,343
2,600,000 8.000%, 11/15/2021 3,190,694
-----------
Total U.S. Treasury Obligations (identified cost
$10,140,375) 9,820,697
-----------
Closed-End Investment Companies--6.3%
7,200 2002 Target Term Trust, Inc. 102,600
32,900 Blackrock Target Term Trust 320,775
228,000 TCW/DW Term Trust 2000 2,194,500
50,000 TCW/DW Term Trust 2002 487,500
224,600 TCW/DW Term Trust 2003 2,119,663
-----------
Total Closed-End Investment Companies (identified
cost $5,196,212) 5,225,038
-----------
(3) Repurchase Agreement--0.4%
$ 362,640 Goldman Sachs Group, LP, 4.50%, dated 5/28/1999, due
6/1/1999 (at amortized cost) 362,640
-----------
Total Investments (identified cost $85,418,578) $84,323,532
-----------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Short Term Fixed Income Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Principal
Amount Value
- ------------------------------------------------------------------------------
<C> <S> <C>
Asset-Backed Securities--2.3%
$1,000,000 Distribution Financial Services RV Trust, Series
1999-2, Class A4, 6.48%, 10/15/2013 (identified cost
$999,780) $ 995,080
-----------
Collateralized Mortgage Obligations--4.0%
Federal National Mortgage Association, Series 1993-
137, Class B, 5.85%, 7/25/2000 (identified cost
$1,759,573) 1,760,952
-----------
Corporate Bonds--45.2%
Banking & Finance--5.6%
2,500,000 NationsBank Corp., 5.750%, 3/15/2001 2,488,550
-----------
Finance--19.2%
2,000,000 Bankers Trust Corp., 5.850%, 5/11/2000 2,004,760
1,000,000 First National Bank of Chicago, 7.000%, 5/8/2000 1,008,365
2,500,000 General Motors Acceptance Corp., 5.630%, 2/25/2000 2,496,500
1,000,000 Household Finance Corp., 6.125%, 7/15/2002 993,030
2,000,000 Merrill Lynch & Co., Inc., 6.020%, 5/11/2001 1,997,580
-----------
Total 8,500,235
-----------
Health Services--5.7%
2,500,000 McKesson Corp., 6.600%, 3/1/2000 2,511,475
-----------
Retail--3.4%
1,500,000 Wal-Mart Stores, Inc., 5.850%, 6/1/2000 1,503,720
-----------
Technology--6.8%
3,000,000 Xerox Corp., 5.750%, 7/21/2000 2,998,716
-----------
Utilities-Electric--4.5%
2,000,000 Kansas City Power & Light Co., 6.370%, 10/15/1999 2,007,180
-----------
Total Corporate Bonds (identified cost $20,051,885) 20,009,876
-----------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount
or Shares Value
- -------------------------------------------------------------------------------
<C> <S> <C>
U.S. Government Agencies--23.8%
Federal Home Loan Bank System--13.4%
$6,000,000 5.735%, 7/22/2003 $ 5,935,320
-----------
Federal National Mortgage Association--10.4%
4,731,094 6.000%, 9/1/2013 4,615,750
-----------
Total U.S. Government Agencies (identified cost
$10,638,841) 10,551,070
-----------
U.S. Treasury Obligations--17.6%
United States Treasury Notes--17.6%
2,000,000 5.625%, 12/31/2002 1,998,440
3,000,000 5.750%, 4/30/2003 3,007,020
1,000,000 5.750%, 8/15/2003 1,002,030
1,750,000 6.250%, 8/31/2002 1,781,710
-----------
Total 7,789,200
-----------
Total U.S. Treasury Obligations (identified cost
$7,947,422) 7,789,200
-----------
Closed-End Investment Company--4.4%
192,301 Blackrock 1999 Term Trust (identified cost
$1,785,515) 1,923,010
-----------
(3) Repurchase Agreement--1.5%
$ 684,523 Goldman Sachs Group, LP, 4.500%, dated 5/28/1999, due
6/1/1999 (at amortized cost) 684,523
-----------
Total Investments (identified cost $43,867,539) $43,713,711
-----------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Georgia Municipal Bond Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--96.9%
Georgia--96.6%
$ 330,000 Alpharetta, GA Development Authority,
University and College Improvement Revenue
Bonds, 4.80% (Original Issue Yield: 4.925%),
11/1/2018 AA $ 314,939
600,000 Americus-Sumter County, GA Hospital
Authority, Revenue Bonds, 5.125% (AMBAC INS),
12/1/2018 Aaa 584,832
100,000 Atlanta, GA Downtown Development Authority,
Refunding Revenue Bonds, 6.25% (Original
Issue Yield: 6.435%), 10/1/2016 AA 108,505
200,000 Atlanta, GA, GO UT (Series A), 6.125%
(Original Issue Yield: 6.18%), 12/1/2023 AA 222,828
510,000 Atlanta, GA, Urban Residential Finance
Authority, Dorm Facility Revenue Refunding
Bonds, 5.70% (Morehouse College)/(MBIA INS),
12/1/2010 AAA 546,052
80,000 Brunswick, GA, Water & Sewer Refunding
Revenue Bonds, 6.10% (MBIA INS)/(Original
Issue Yield: 6.27%), 10/1/2019 AAA 90,431
60,000 Burke County, GA Development Authority, PCR
Bonds, 7.50% (Oglethorpe Power Corp.)/(MBIA
INS), 1/1/2003 AAA 63,581
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- ------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
Georgia--continued
$ 50,000 Chatham County, GA School District, GO UT,
6.75% (MBIA INS), 8/1/2018 AAA $ 56,176
300,000 Cherokee County, GA Water & Sewer Authority,
Revenue Bonds, 4.75% (Original Issue Yield:
4.99%), 8/1/2028 AAA 277,077
500,000 Cherokee County, GA Water & Sewer Authority,
Water Utility & Sewer Improvement Revenue
Bonds, 5.00% (FGIC INS)/(Original Issue
Yield: 5.25%), 8/1/2027 AAA 482,750
790,000 Clayton County & Clayton County, GA Water
Authority, Refunding Revenue Bonds, 5.20%
(MBIA INS)/(Original Issue Yield: 5.30%),
5/1/2005 AAA 830,819
325,000 Clayton County, GA, GO UT Correctional
Facilities and Public Improvements Bonds,
4.50%, 8/1/2001 AA 330,473
100,000 Cobb County, GA Solid Waste Management
Authority, Revenue Bonds, 6.35%, 1/1/2009 AAA 110,873
750,000 Cobb County, GA, GO UT, 5.375% (Original
Issue Yield: 5.50%), 1/1/2010 AAA 785,108
1,000,000 Cobb County, GA, Refunding Revenue Bonds
(Series A), 5.20% (Original Issue Yield:
5.25%), 7/1/2005 AA 1,052,940
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Georgia Municipal Bond Fund
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
Georgia--continued
$ 500,000 Coweta County, GA Development Authority,
School Improvements, 3.70% (AMBAC LOC)/
(Original Issue Yield: 3.85%), 12/1/1999 AAA $ 500,960
500,000 Coweta County, GA School System, GO UT Bonds,
5.00%, 8/1/2009 AA- 518,340
1,000,000 Dalton, GA, Refunding Revenue Bonds, 5.00%
(MBIA INS), 1/1/2004 AAA 1,038,770
150,000 De Kalb County, GA Development Authority, GO UT Bonds, 5.50%
(Original Issue Yield:
5.60%), 1/1/2016 AA+ 156,228
200,000 De Kalb County, GA School District, GO UT
Bonds (Series A), 6.25%, 7/1/2011 AA 228,038
1,000,000 De Kalb County, GA Water & Sewer, Refunding
Revenue Bonds, 5.125% (Original Issue Yield:
5.25%), 10/1/2011 AA 1,014,580
500,000 De Kalb County, GA Water & Sewer, Refunding Revenue Bonds, 5.25%
(Original Issue Yield:
5.42%), 10/1/2023 AA 495,825
500,000 De Kalb County, GA, Refunding Revenue Bonds
(Series A), 5.375% (Emory University),
11/1/2005 AA 534,360
100,000 Decatur, GA Housing Authority, Mortgage
Refunding Revenue Bonds, 6.45% (FHA and MBIA
INS)/(Original Issue Yield: 6.524%), 7/1/2025 AAA 104,935
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
Georgia--continued
$ 500,000 Downtown Savannah, GA, Refunding Revenue
Bonds (Series A), 4.95% (Original Issue
Yield: 5.05%), 1/1/2006 AA $ 515,355
160,000 Fayette County, GA, Water Revenue Bonds
(Series B), 6.20% (FGIC INS)/(Original Issue
Yield: 6.30%), 10/1/2022 AAA 174,571
60,000 Forsyth County, GA School District, GO UT
Bonds, 6.70%, 7/1/2012 AA- 70,694
25,000 Fulton County, GA School District, GO UT
Bonds, 5.60% (Original Issue Yield: 5.65%),
1/1/2011 AA 26,952
1,950,000 Fulton County, GA Water & Sewage System,
4.75%, 1/1/2020 AA- 1,826,916
475,000 Fulton County, GA Water & Sewage System,
6.25% (FGIC INS)/ (Original Issue Yield:
6.425%), 1/1/2007 AAA 530,033
300,000 Fulton County, GA Water & Sewage System,
Revenue Refunding Bonds, 5.625% (FGIC
INS)/(Original Issue Yield: 5.75%), 1/1/2001 AAA 308,952
500,000 Fulton De Kalb, GA Hospital Authority,
Revenue Bonds, 5.50% (MBIA INS)/(Original
Issue Yield: 5.85%), 1/1/2012 AAA 522,435
400,000 Gainsville & Hall County, GA Hospital
Authority, Revenue Anticipation Certificates,
5.75% (Northeast GA Healthcare Project)/
(MBIA INS)/(Original Issue Yield: 5.98%),
10/1/2017 AAA 416,768
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Georgia Municipal Bond Fund
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
Georgia--continued
$ 300,000 Georgia Medical Center Hospital Authority,
Refunding Revenue Anticipation Certificates
(Series C), 5.90% (Columbus Regional
Healthcare System)/
(MBIA INS)/(Original Issue Yield: 5.95%),
8/1/2001 AAA $ 313,290
285,000 Georgia Municipal Electric Authority,
Electric Power Refunding Revenue Bonds
(Series B), 6.125% (FGIC INS)/(Original Issue
Yield: 6.30%), 1/1/2014 AAA 306,574
500,000 Georgia State HFA, Refunding Revenue SFM
Bonds (Subseries A-2), 6.55% (FHA/VA mtgs
GTD), 12/1/2027 AAA 529,475
200,000 Georgia State, GO UT Bonds (Series B), 7.20%,
3/1/2006 AAA 233,826
500,000 Georgia State, GO UT Bonds (Series D), 6.80%,
8/1/2000 AAA 519,940
200,000 Georgia State, GO UT Bonds (Series F), 6.50%,
12/1/2007 AAA 230,076
500,000 Georgia State, GO UT Refunding Bonds, 5.80%
(Original Issue Yield: 5.50%), 3/1/2000 AAA 509,855
1,480,000 Georgia State, GO UT, 5.25% (Original Issue
Yield: 3.75%), 10/1/2007 AAA 1,575,993
430,000 Georgia State, GO UT, 6.25%, 4/1/2007 AAA 483,612
500,000 Georgia State, GO UT, 6.50% (Original Issue
Yield: 6.63%), 4/1/2006 AAA 565,675
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
Georgia--continued
$ 100,000 Gwinnett County, GA, Water & Sewage Utility
Certificates of Participation, 8.40%,
8/1/2001 AAA $ 109,663
600,000 Henry County, GA & Henry County Water & Sewer
Authority, Revenue Bond, 5.00% (AMBAC
INS)/(Original Issue Yield: 5.32%), 2/1/2026 AAA 579,810
400,000 Marietta, GA Development Authority, Revenue
Bonds (Series B), 5.75% (Life College,
Inc.)/(FGIC INS)/
(Original Issue Yield: 5.91%), 9/1/2014 AAA 423,528
500,000 Marietta, GA, GO UT (Series A) School
Improvement Bonds, 4.50% (Original Issue
Yield: 4.88%), 2/1/2019 AA- 453,450
500,000 Meriwether County, GA School District, GO UT
Bonds, 7.00% (FSA INS), 2/1/2007 AAA 581,205
400,000 Newton County School District, GA, GO UT Bonds, 5.625% (FGIC
INS)/(Original Issue
Yield: 5.70%), 2/1/2013 AAA 422,724
100,000 Peach County, GA School District, GO UT
Bonds, 6.30% (MBIA INS)/(Original Issue
Yield: 6.35%), 2/1/2014 AAA 112,106
250,000 Private Colleges & Universities Facilities of
GA, Refunding Revenue Bonds, 5.625% (Agnes
Scott College Project)/
(Original Issue Yield: 5.70%), 6/1/2023 AA 258,743
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Georgia Municipal Bond Fund
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
Georgia--continued
$1,400,000 Private Colleges & Universities Facilities of
GA, University and College Improvements,
4.75% (Agnes Scott College Project)/(MBIA
INS)/(Original Issue Yield: 5.079%), 6/1/2028 AAA $ 1,293,376
685,000 Richmond County, GA Water & Sewage, Refunding
Revenue Bonds, 5.25% (FGIC INS)/(Original
Issue Yield: 5.491%), 10/1/2021 AAA 688,213
200,000 Rockdale County, GA School District, GO UT
Bonds, 6.30%, 1/1/2007 A1 221,256
150,000 Savannah, GA Resources Recovery Development
Authority, Refunding Revenue Bonds, 5.95%
(Savannah Energy Systems Co.), 12/1/2002 A+ 157,638
335,000 Savannah, GA Resources Recovery Development
Authority, Revenue Bonds, 6.30% (Savannah
Energy Systems Co.), 12/1/2006 A+ 354,353
110,000 Savannah, GA Water & Sewage, Revenue Bonds,
5.10% (Original Issue Yield: 5.55%),
12/1/2010 AA- 111,873
-----------
Total 25,878,350
-----------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Credit
or Shares Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
Puerto Rico--0.3%
$ 25,000 Puerto Rico Commonwealth Infrastructure
Financing Authority, Revenue Bonds (Series
A), 5.00% (AMBAC LOC)/(Original Issue Yield:
5.28%), 7/1/2028 AAA $ 24,345
5,000 Puerto Rico Electric Power Authority, Revenue
Bonds (Series DD), 5.00% (MBIA INS)/(Original
Issue Yield: 5.28%), 7/1/2028 AAA 4,869
45,000 Puerto Rico Highway and Transportation
Authority, Refunding Revenue Bonds (Series A), 5.00% (AMBAC
LOC)/(Original Issue Yield:
5.16%), 7/1/2028 AAA 43,820
-----------
Total 73,034
-----------
Total Long-Term Municipals (identified cost
$25,328,815) 25,951,384
-----------
Open-End Investment Companies--1.7%
8,690 Dreyfus Tax Exempt Money Market Fund 8,690
450,440 Fidelity Tax Exempt Money Market Fund 450,440
-----------
Total Open-End Investment Companies (at net
asset value) 459,130
-----------
Total Investments (identified cost
$25,787,945) $26,410,514
-----------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia North Carolina Municipal Bond Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--94.0%
North Carolina--93.9%
$1,030,000 Buncombe County, NC, GO UT Bonds, 4.90%
(Original Issue Yield: 5.15%), 4/1/2014 AA $ 1,028,321
1,400,000 Carteret County, NC, GO UT Bonds, 5.40% (MBIA
INS)/(Original Issue Yield: 5.60%), 5/1/2015 AAA 1,451,856
1,000,000 Centennial Authority, NC, Revenue Bonds,
4.85% (FSA INS)/(Original Issue Yield:
4.95%), 9/1/2009 AAA 1,018,960
100,000 Charlotte, NC, GO UT Bonds, 5.70%, 2/1/2007 AAA 108,134
1,500,000 Charlotte, NC, GO UT Refunding Bonds, 5.00%
(Original Issue Yield: 3.95%), 2/1/2001 AAA 1,534,305
1,250,000 Charlotte, NC, GO UT Refunding Bonds, 5.00%
(Original Issue Yield: 5.10%), 2/1/2009 AAA 1,302,000
840,000 Charlotte, NC, GO UT Refunding Bonds, 5.00%
(Original Issue Yield: 5.15%), 2/1/2012 AAA 862,596
900,000 Charlotte, NC, GO UT Water & Sewer Bonds
(Series A), 5.30%, 4/1/2008 AAA 951,984
1,120,000 Charlotte, NC, GO UT Water & Sewer Bonds,
5.50%, 5/1/2005 AAA 1,197,146
2,000,000 Charlotte, NC, GO UT Water & Sewer Bonds,
5.80%, 2/1/2014 AAA 2,179,400
1,000,000 Charlotte, NC, GO UT Water & Sewer Bonds,
5.90%, 2/1/2018 AAA 1,093,920
960,000 Charlotte-Mecklenburg Hospital Authority, NC,
Health System Refunding Revenue Bonds, 5.75%
(Original Issue Yield: 6.498%), 1/1/2012 AA 1,013,251
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
North Carolina--continued
$1,000,000 Charlotte-Mecklenburg Hospital Authority, NC,
Revenue Bonds, 5.60% (Original Issue Yield:
5.70%), 1/15/2009 AA $ 1,073,090
250,000 Concord, NC, (Series A) Multiple Utility
Improvement Revenue Bonds, 5.00% (MBIA INS),
12/1/2022 AAA 242,435
345,000 Concord, NC, Certificate of Participation,
5.60% (MBIA INS)/(Original Issue Yield:
5.70%), 6/1/2005 AAA 368,056
445,000 Concord, NC, Certificate of Participation,
5.40% (MBIA INS)/(Original Issue Yield:
5.50%), 6/1/2003 AAA 466,013
1,000,000 Concord, NC, Revenue Bonds (Series A), 5.00%
(MBIA INS), 12/1/2017 AAA 986,340
2,000,000 Cumberland County, NC Hospital Facilities,
Refunding Revenue Bonds, 4.00%, 10/1/2002 A- 1,987,860
210,000 Cumberland County, NC Hospital Facilities,
Revenue Bonds, 6.00% (MBIA INS)/
(Original Issue Yield: 6.84%), 10/1/2021 AAA 220,704
1,100,000 Cumberland County, NC Industrial Facilities &
Pollution Control Financing Authority,
Revenue Bonds Weekly VRDNs (Monsanto Co.) A2 1,100,000
100,000 Cumberland County, NC, Certificate of
Participation (Series A), 6.375% (Cumberland
County, NC Civic Center Project)/(AMBAC
INS)/(Original Issue Yield: 6.50%), 12/1/2010 AAA 112,900
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia North Carolina Municipal Bond Fund
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
North Carolina--continued
$ 615,000 Currituck County, NC, GO UT Bonds, 5.40%
(MBIA INS), 4/1/2009 AAA $ 651,396
100,000 Durham County, NC, GO UT Bonds, 5.75%
(Original Issue Yield: 5.95%), 2/1/2009 AAA 106,330
50,000 Durham, NC Water & Sewer Utility System,
Revenue Bonds, 5.80% (Original Issue Yield:
5.85%), 12/1/2003 AA 53,775
100,000 Durham, NC, GO UT Revenue Bonds, 5.80%
(Original Issue Yield: 5.95%), 2/1/2012 AAA 108,809
100,000 East Carolina University, NC, Revenue Bonds,
5.50% (Original Issue Yield: 5.60%), 5/1/2018 A 101,229
1,500,000 Fayetteville, NC Public Works Commission,
Refunding Revenue Bonds, 4.75% (FGIC
INS)/(Original Issue Yield: 5.23%), 3/1/2014 AAA 1,464,900
1,000,000 Forsyth County, NC, GO UT, 4.75%, 2/1/2005 AAA 1,032,300
160,000 Franklin County, NC, Certificates of Participation, 6.10% (Jail &
School Project)/(FGIC INS)/(Original Issue Yield:
6.20%), 6/1/2003 AAA 172,667
310,000 Fremont, NC Housing Development Corp., First
Lien Revenue Refunding Bonds, 6.75% (Torhunta
Apts)/
(FNMA COL), 7/15/2022 Aaa 326,101
2,025,000 Gastonia, NC Combined Utilities System,
Revenue Bonds, 4.75% (MBIA INS)/ (Original
Issue Yield: 4.98%), 5/1/2015 AAA 1,964,371
100,000 Gastonia, NC Combined Utilities System,
Revenue Bonds, 6.00% (MBIA INS)/
(Original Issue Yield: 6.10%), 5/1/2014 AAA 110,195
500,000 Gastonia, NC, GO UT Bonds, 5.30% (FGIC
INS)/(Original Issue Yield: 5.40%), 6/1/2009 AAA 527,555
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
North Carolina--continued
$ 500,000 Gastonia, NC, GO UT, 5.40% (MBIA INS),
5/1/2011 AAA $ 527,485
1,000,000 Greensboro, NC, Certificate of Participation
(Series A), 5.625% (Original Issue Yield:
6.05%), 12/1/2015 AA 1,048,760
105,000 Greensboro, NC, Certificates
of Participation, 6.65% (Coliseum Arena
Expansion Project)/(Original Issue Yield:
6.70%), 12/1/2004 AA 113,400
2,535,000 Greensboro, NC, GO UT Bonds, 4.70% (Original
Issue Yield: 4.90%), 4/1/2016 AAA 2,441,408
100,000 Greenville, NC Combined Enterprise System,
Revenue Bonds, 5.70% (Original Issue Yield:
5.75%), 9/1/2006 A+ 108,044
75,000 Harnett County, NC, Certificates of
Participation, 5.90% (AMBAC INS), 12/1/2000 AAA 77,698
500,000 Harnett County, NC, Certificates of
Participation, 6.20% (AMBAC INS), 12/1/2009 AAA 551,985
600,000 High Point, NC, GO UT Revenue Bonds, 5.60%,
3/1/2008 AA 642,126
600,000 Lee County, NC, GO UT, 5.00% (MBIA
INS)/(Original Issue Yield: 5.05%), 4/1/2009 AAA 621,918
100,000 Martin County, NC IFA, PCR Bonds, 6.80%
(Weyerhaeuser Co.), 5/1/2024 A 108,672
850,000 Martin County, NC IFA, Revenue Bonds, 5.65%
(Weyerhaeuser Co.), 12/1/2023 A 857,582
1,925,000 Mecklenburg County, NC, GO UT (Series B),
4.40% (Original Issue Yield: 4.60%), 2/1/2013 AAA 1,842,186
1,705,000 Mecklenburg County, NC, GO UT Bonds, 4.80%
(Original Issue Yield: 4.90%), 3/1/2009 AAA 1,746,960
3,670,000 Mecklenburg County, NC, GO UT, 4.40%
(Original Issue Yield: 4.45%), 2/1/2011 AAA 3,570,763
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia North Carolina Municipal Bond Fund
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
North Carolina--continued
$1,000,000 Mecklenburg County, NC, GO UT, 4.40%,
2/1/2010 AAA $ 984,630
150,000 Moore County, NC, GO UT Bonds, 4.60% (MBIA
INS)/
(Original Issue Yield: 4.65%), 6/1/2011 AAA 147,810
675,000 Moore County, NC, GO UT Public Improvements,
4.90% (MBIA INS)/(Original Issue Yield:
4.95%), 6/1/2015 AAA 667,109
600,000 Moore County, NC, GO UT Public Improvement,
4.90% (MBIA INS)/(Original Issue Yield:
4.90%), 6/1/2014 AAA 597,792
350,000 New Hanover County, NC, GO UT Bonds, 4.80%,
2/1/2017 AA- 337,011
350,000 New Hanover County, NC, GO UT Bonds, 4.90%,
2/1/2018 AA- 340,252
100,000 North Carolina Educational Facilities Finance
Agency, Refunding Revenue Bonds, 6.00%
(Davidson College)/
(Original Issue Yield: 6.20%), 12/1/2012 AA 107,697
450,000 North Carolina Educational Facilities Finance
Agency, Revenue Bonds (Series B), 4.25% (Duke
University)/
(Original Issue Yield: 4.30%), 10/1/2003 AA+ 456,664
1,000,000 North Carolina Educational Facilities Finance
Agency, Revenue Bonds (Series C), 6.75% (Duke
University)/
(Original Issue Yield: 6.769%), 10/1/2021 AA+ 1,078,740
20,000 North Carolina HFA, Multi-family Refunding
Revenue Bonds (Series B), 6.90% (FHA INS),
7/1/2024 Aa2 21,394
85,000 North Carolina HFA, Revenue Bonds (Series Z),
6.60%, 9/1/2026 AA 90,368
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
North Carolina--continued
$ 750,000 North Carolina HFA, Revenue Bonds, 6.20%,
3/1/2018 AA $ 791,895
2,000,000 North Carolina Medical Care Commission,
Refunding Revenue Bonds, 5.00% BANs, 6/1/2013 AAA 1,983,100
50,000 North Carolina Medical Care Commission,
Refunding Revenue Bonds, 6.125% (Rex
Hospital)/(Original Issue Yield: 6.219%),
6/1/2010 A+ 54,782
1,000,000 North Carolina Medical Care Commission,
Revenue Bonds (Series C), 5.25% (Duke
University Hospital)/(Original Issue Yield:
5.65%), 6/1/2017 AA 1,000,280
3,500,000 North Carolina Medical Care Commission,
Revenue Bonds, 4.75% (FirstHealth of the Carolina's, Inc.)/(Original
Issue Yield:
5.14%), 10/1/2026 AA- 3,137,575
525,000 North Carolina Medical Care Commission,
Revenue Bonds, 5.20% (Moore Regional
Hospital)/(FGIC INS)/(Original Issue Yield:
5.30%), 10/1/2013 AAA 533,888
1,500,000 North Carolina Medical Care Commission,
Revenue Bonds, 5.375% (Wake County Hospital
Systems)/(MBIA INS)/(Original Issue Yield:
5.75%), 10/1/2026 AAA 1,510,530
1,000,000 North Carolina Medical Care Commission,
Revenue Bonds, 7.00% (Duke University
Hospital)/(Original Issue Yield: 7.08%),
6/1/2021 NR 1,081,930
1,095,000 North Carolina Medical Care Commission,
Refunding Revenue Bonds, 5.10% (Wilson
Memorial Hospital)/(AMBAC INS)/(Original
Issue Yield: 5.25%), 11/1/2009 AAA 1,131,682
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia North Carolina Municipal Bond Fund
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
North Carolina--continued
$1,525,000 North Carolina Medical Care Commission,
Refunding Revenue Bonds, 5.20% (Wilson
Memorial Hospital)/(AMBAC INS)/(Original
Issue Yield: 5.35%), 11/1/2010 AAA $ 1,573,312
850,000 North Carolina Medical Care Commission,
Refunding Revenue, 7.375% (Presbyterian
Hospital)/(United States Treasury
PRF)/(Original Issue Yield: 7.417%),
10/1/2000 (Callable @ 102) AAA 909,908
115,000 North Carolina Municipal Power Agency No. 1,
Catawba Electric Revenue Refunding Bonds,
5.90% (Original Issue Yield: 5.95%), 1/1/2003 A- 120,778
1,200,000 North Carolina State, GO UT (Series A), 6.00%
(Original Issue Yield: 5.85%), 3/1/2000 AAA 1,225,428
1,000,000 North Carolina State, GO UT Refunding Bonds
(Series C), 4.80% (North Carolina Prison
Facilities)/(Original Issue Yield: 4.85%),
3/1/2009 AAA 1,024,610
575,000 Onslow County, NC, GO UT Bonds, 5.70% (MBIA
INS)/
(Original Issue Yield: 5.85%), 3/1/2013 AAA 610,995
635,000 Pitt County, NC, Refunding Revenue Bonds,
5.20% (Pitt County Memorial Hospital)/
(Original Issue Yield: 5.30%), 12/1/2008 NR 668,718
350,000 Raleigh, NC, Certificate Participation
Refunding Bonds, 5.00% (Cabarrus Street
Parking Facilities Project)/(Original Issue
Yield: 5.10%), 12/1/2009 AA 357,910
230,000 Raleigh, NC, Certificate Participation
Refunding Bonds, 5.10% (Cabarrus Street
Parking Facilities Project)/(Original Issue
Yield: 5.20%), 12/1/2010 AA 234,692
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
North Carolina--continued
$ 400,000 Raleigh, NC, GO UT Refunding Bonds, 6.40%,
3/1/2006 AAA $ 426,104
500,000 Raleigh, NC, Revenue Bonds, 4.75% (Original
Issue Yield: 5.04%), 3/1/2024 AA+ 465,215
300,000 Raleigh, NC, Water Utility Improvement
Revenue Bonds, 5.125% (Original Issue Yield:
5.61%), 3/1/2022 AA+ 294,834
800,000 Randolph County, NC, Certificates of
Participation, 4.875% (MBIA INS)/(Original
Issue Yield: 5.05%), 6/1/2006 AAA 826,352
500,000 Robeson County, NC, GO UT Refunding Bonds,
4.90% (AMBAC INS), 2/1/2007 AAA 516,930
1,025,000 Sanford, NC, GO UT Bonds, 4.90% (MBIA INS),
3/1/2009 AAA 1,054,172
1,095,000 Shelby, NC Housing Development Corp.,
Mortgage Revenue Bonds, 6.10% (Hickory Creek
Apartments)/
(FHA INS), 2/1/2023 AAA 1,156,123
1,500,000 Wake County, NC Industrial Facilities & PCFA,
(Series 1990A) Daily VRDNs (Carolina Power &
Light Co.)/(Fuji Bank, Ltd., Tokyo LOC) AA- 1,500,000
500,000 Wake County, NC, GO UT Refunding Bonds, 4.60%
(Original Issue Yield: 4.70%), 4/1/2004 AAA 513,085
650,000 Wake County, NC, GO UT Refunding Bonds, 4.70%
(Original Issue Yield: 4.80%), 4/1/2005 AAA 669,188
1,000,000 Wake County, NC, GO UT, 4.50% (Original Issue
Yield: 4.62%), 3/1/2009 AAA 1,002,680
500,000 Wake County, NC, GO UT, 4.90%, 3/1/2004 AAA 519,625
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia North Carolina Municipal Bond Fund
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
North Carolina--continued
$1,375,000 Wake County, NC, Hospital Revenue Bonds,
5.125% (MBIA INS)/(Original Issue Yield:
5.35%), 10/1/2026 AAA $ 1,385,395
75,000 Wilmington, NC, GO UT Revenue Bonds, 5.60%
(Original Issue Yield: 5.75%), 6/1/2010 A+ 79,325
-----------
Total 74,368,394
-----------
Puerto Rico--0.1%
25,000 Puerto Rico Commonwealth Infrastructure Financing Authority, Revenue
Bonds (Series A), 5.00% (AMBAC LOC)/(Original Issue Yield:
5.28%), 7/1/2028 AAA 24,345
25,000 Puerto Rico Electric Power Authority, Revenue
Bonds (Series DD), 5.00% (MBIA INS)/(Original
Issue Yield: 5.28%), 7/1/2028 AAA 24,345
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Credit
or Shares Rating* Value
- ------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
Puerto Rico--continued
$ 25,000 Puerto Rico Highway and Transportation Authority, Refunding
Revenue Bonds (Series A), 5.00% (AMBAC LOC)/(Original Issue Yield:
5.16%), 7/1/2028 AAA $ 24,345
-----------
Total 73,035
-----------
Total Long-Term Municipals (identified cost
$72,353,681) 74,441,429
-----------
Open-End Investment Companies--9.8%
3,984,903 AIM Global Management Money Market Fund 3,984,903
118,000 Dreyfus Tax Exempt Money Market Fund 118,000
3,691,213 Fidelity Tax Exempt Money Market Fund 3,691,213
-----------
Total Open-End Investment Companies
(at net asset value) 7,794,116
-----------
Total Investments (identified cost
$80,147,797) $82,235,545
-----------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia South Carolina Municipal Bond Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--92.5%
South Carolina--91.6%
$ 540,000 Barnwell County, SC School District No. 45,
GO UT Refunding Bonds, 5.60% (AMBAC
INS)/(State Aid Withholding LOC)/(Original
Issue Yield: 5.65%), 2/1/2012 AAA $ 566,681
570,000 Barnwell County, SC School District No. 45,
GO UT Refunding Bonds, 5.60% (AMBAC
INS)/(State Aid Withholding LOC)/(Original
Issue Yield: 5.70%), 2/1/2013 AAA 596,824
1,300,000 Beaufort County, SC School District, GO UT,
4.70%, 3/1/2006 AA 1,329,913
500,000 Beaufort County, SC, Certificate of
Participation, 5.00% (Hilton Head Airport),
7/1/2001 A2 510,775
675,000 Beaufort County, SC, Certificates of
Participation, 7.125% (AMBAC INS)/
(Original Issue Yield: 7.45%), 6/1/2012 AAA 713,583
855,000 Beaufort-Jasper, SC Water & Sewer Authority,
Waterworks and Sewer System Revenue Bonds,
5.90% (FGIC INS)/
(Original Issue Yield: 6.00%), 3/1/2016 AAA 909,275
750,000 Berkeley County, SC Pollution Control
Facilities, Revenue Bonds 6.50% (South
Carolina Electric and Gas), 10/1/2014 A 815,513
1,500,000 Berkeley County, SC, Water & Sewer Refunding
Revenue Bonds, 5.50% (MBIA INS)/
(Original Issue Yield: 5.55%), 6/1/2013 AAA 1,566,570
1,000,000 Camden, SC Public Utility, Revenue Refunding
Bonds, 5.50% (MBIA INS)/(Original Issue
Yield: 5.80%), 3/1/2022 AAA 1,031,530
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$1,105,000 Charleston County, SC Airport District,
Airport System Refunding Revenue Bonds,
4.75% (MBIA INS), 7/1/2015 AAA $ 1,064,601
3,000,000 Charleston County, SC School District, GO UT
School Improvement, 4.00%, 2/1/2002 AA 3,015,390
1,260,000 Charleston, SC Waterworks and Sewer
Refunding Revenue Bonds, 5.00% (MBIA INS),
1/1/2022 AAA 1,212,901
1,000,000 Charleston, SC Waterworks and Sewer
Refunding Revenue Bonds, 6.00% (Original
Issue Yield: 6.242%), 1/1/2012 AA- 1,060,280
3,000,000 Charleston, SC Waterworks and Sewer, Revenue
Refunding Bonds, 4.50% (FGIC LOC)/(Original
Issue Yield: 5.03%), 1/1/2024 AAA 2,666,490
1,900,000 Charleston, SC, Certificates of
Participation, 5.00% (AMBAC INS)/(Original
Issue Yield: 5.39%), 9/1/2015 AAA 1,859,511
1,000,000 Charleston, SC, Certificates of
Participation, 7.10% (MBIA INS)/(United
States Treasury PRF), 6/1/2001 (Callable
@ 102) AAA 1,083,480
250,000 Charleston, SC, GO Bonds (Series A), 6.30%,
9/1/2005 AA 267,583
875,000 Chester County, SC School District, GO UT,
6.85% (United States Treasury PRF)/(Original
Issue Yield: 6.95%), 2/1/2012 AA 913,001
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia South Carolina Municipal Bond Fund
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$1,125,000 Chester County, SC School District, GO UT,
6.85% (United States Treasury PRF)/(Original
Issue Yield: 6.90%), 2/1/2000 (Callable
@ 102) AA $ 1,173,859
1,500,000 Columbia, SC Waterworks & Sewer System,
Refunding Revenue Bonds, 5.70%, 2/1/2010 AA 1,630,590
1,000,000 Columbia, SC, Parking Facilities Refunding
Revenue Bonds, 5.875% (AMBAC INS)/(Original
Issue Yield: 6.007%), 12/1/2013 AAA 1,082,840
1,065,000 Dorchester County, SC School District No.
002, GO UT Bonds, 5.125% (FGIC
INS)/(Original Issue Yield: 5.25%), 2/1/2012 AAA 1,079,335
1,500,000 Dorchester County, SC School District No.
002, GO UT Bonds, 5.20% (FGIC INS), 2/1/2018 AAA 1,501,980 2,250,000
Dorchester County, SC School District No.
002, GO UT Bonds, 5.20% (FGIC INS)/(Original
Issue Yield: 5.35%), 2/1/2017 AAA 2,254,995
600,000 Dorchester County, SC School District No.
002, GO UT Bonds, 6.65% (MBIA INS)/(United States Treasury
PRF)/(Original Issue Yield:
6.85%), 7/1/1999 (Callable @ 102) AAA 613,758
870,000 Edgefield County, SC School District, GO UT
Bonds, 6.40% (FSA INS)/(Original Issue
Yield: 6.60%), 2/1/2009 AAA 957,418
1,155,000 Fairfield County, SC School District,
Certificates of Participation, 5.50%
(Fairfield Primary Geiger)/(Asset Guaranty
GTD)/(Original Issue Yield: 5.60%), 3/1/2007 AA 1,215,557
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$2,000,000 Fairfield County, SC, PCR Bonds, 6.50%
(South Carolina Electric and Gas), 9/1/2014 A+ $ 2,181,620
500,000 Florence County, SC, Hospital Revenue Bonds,
6.75% (Mcleod Regional Medical Center)/(FGIC
INS)/(Original Issue Yield: 7.00%),
11/1/2010 AAA 532,460
1,500,000 Florence County, SC, Revenue Bonds, 4.75%
(Mcleod Regional Medical Center)/(MBIA
INS)/(Original Issue Yield: 4.75%),
11/1/2027 AAA 1,362,120
2,805,000 Grand Strand Water & Sewage Authority, SC,
Revenue Refunding Bonds, 6.375% (South
Carolina Waterworks & Sewer System)/(MBIA
INS)/(Original Issue Yield: 6.508%),
6/1/2012 AAA 3,236,157
800,000 Grand Strand Water & Sewage Authority, SC,
Waterworks & Sewer System Revenue Refunding
Bonds, 6.00% (MBIA INS)/(Original Issue
Yield: 6.595%), 6/1/2019 AAA 839,256
500,000 Greenville County, SC, IRB, 7.10% (Lockheed
Aeromod Center Incorporated Project),
11/1/2011 BBB+ 532,130
5,250,000 Greenville, SC Hospital System Facilities,
Refunding Revenue Bonds (Series B), 5.25%
(Original Issue Yield: 6.125%), 5/1/2023 AA 5,052,653
600,000 Greenville, SC Hospital System Facilities,
Refunding Revenue Bonds, 5.75% (Original
Issue Yield: 5.95%), 5/1/2013 AA 632,274
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia South Carolina Municipal Bond Fund
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$1,500,000 Greenville, SC Hospital System Facilities,
Revenue Bonds (Series B), 5.25% (Original
Issue Yield: 6.076%), 5/1/2017 AA $ 1,478,535
760,000 Greenville, SC Hospital System Facilities,
Revenue Bonds, 7.00% (Greenville Health
Corp.)/(Original Issue Yield: 7.454%),
5/1/2017 AAA 799,930
2,000,000 Greenville, SC Waterworks Revenue, Revenue
Bonds, 5.50% (Original Issue Yield: 5.60%),
2/1/2022 AA 2,039,680
1,000,000 Hilton Head Island, SC Public Facilities
Corp., Certificates of Participation, 5.40%
(AMBAC INS)/(Original Issue Yield: 5.599%),
3/1/2009 AAA 1,042,480
980,000 Horry County, SC, GO UT Refunding Bonds
(Series B), 4.65% (MBIA INS), 12/1/2005 AAA 1,006,176
1,960,000 Lancaster County, SC School District, GO UT,
6.50% (MBIA INS)/(Original Issue Yield:
6.599%), 7/1/2008 AAA 2,145,690
655,000 Lexington & Richland Counties, SC School
District No. 005, GO UT Bonds, 5.05% (MBIA
INS), 3/1/2005 AAA 683,682
175,000 Lexington County, SC, IRB, (Series C), 8.00%
(J.B. White & Co. Project), 1/1/2011 NR 184,678
2,000,000 Lexington County, SC Health Services
District, Inc., Refunding Revenue Bonds,
5.125% (FSA INS)/(Original Issue Yield:
5.50%), 11/1/2021 AAA 1,945,360
2,500,000 Lexington County, SC Health Services
District, Inc., Revenue Bonds, 5.125% (FSA
INS)/(Original Issue Yield: 5.53%),
11/1/2026 AAA 2,414,250
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$ 805,000 Medical University of South Carolina,
Hospital Facilities Revenue Bonds, 5.25%
(MBIA INS)/(Original Issue Yield: 5.25%),
7/1/2004 AAA $ 846,176
2,000,000 North Charleston, SC Sewer District,
Refunding Revenue Bonds (Series A), 6.00%
(MBIA INS)/(Original Issue Yield: 6.593%),
7/1/2018 AAA 2,100,600
500,000 North Charleston, SC Sewer District, Revenue
Bonds (Series B), 6.00% (MBIA INS)/(Original
Issue Yield: 6.593%), 7/1/2018 AAA 531,255
275,000 Oconee County, SC School District, GO UT
Bonds, 5.10% (MBIA INS)/(Original Issue
Yield: 5.50%), 9/1/2013 AAA 277,321
2,500,000 Oconee County, SC, PCR Refunding Revenue
Bonds, 5.80% (Duke Energy Corp.), 4/1/2014 AA- 2,627,800
590,000 Piedmont Municipal Power Agency, SC,
Electricity Refunding Revenue Bonds, 6.85%
(FGIC INS), 1/1/2007 AAA 628,149
970,000 Piedmont Municipal Power Agency, SC,
Refunding Revenue Bonds (Series A), 6.375%
(FGIC LOC)/
(Original Issue Yield: 6.45%), 1/1/2006 AAA 1,075,614
1,000,000 Piedmont Municipal Power Agency, SC,
Refunding Revenue Bonds, 6.50% (FGIC
INS)/(Original Issue Yield: 6.88%), 1/1/2011 AAA 1,057,710
1,325,000 Richland-Lexington Airport District, Airport
& Marina Revenue Bonds, 6.125% (Columbia
Metropolitan Airport)/(AMBAC INS)/
(Original Issue Yield: 6.40%), 1/1/2025 AAA 1,411,814
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia South Carolina Municipal Bond Fund
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$ 600,000 Richland County, SC Hospital Facilities,
Revenue Bonds (Series PG-A), 7.10%
(Community Provider Pooled Loan
Program)/(FSA INS), 7/1/2005 AAA $ 671,682
1,500,000 Richland County, SC School District No. 001,
GO UT, 4.625%, 3/1/2022 AA 1,366,020
650,000 Richland County, SC Solid Waste Disposal
Facilities, Revenue Bonds (Series A), 7.45%
(Union Camp Corp. Project)/(Original Issue
Yield: 7.513%), 4/1/2021 A- 698,848
1,390,000 Richland County, SC, GO UT Refunding Bonds
(Series B), 6.25% (State Aid Withholding
LOC), 3/1/2001 AA 1,449,895
135,000 Rock Hill, SC Housing Development Corp.,
Multi-family Refunding Revenue Bonds, 7.50%,
7/1/2010 Aaa 143,899
1,000,000 South Carolina Job Development Authority,
Revenue Bonds, 5.25% (Anderson Area Medical
Center, Inc.)/(MBIA INS)/(Original Issue
Yield: 5.63%), 2/1/2015 AAA 1,002,340
500,000 South Carolina Resources Authority, Local
Government Program, Revenue Bonds (Series
A), 7.00%, 6/1/2003 A+ 526,245
1,000,000 South Carolina State Educational Assistance
Authority, Refunding Revenue Bonds (Series
A-3), 5.80% (Original Issue Yield: 5.90%),
9/1/2004 AAA 1,060,670
1,000,000 South Carolina State Educational Assistance
Authority, Refunding Revenue Bonds (Series
B), 5.70% (Original Issue Yield: 5.75%),
9/1/2005 A 1,053,260
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$ 975,000 South Carolina State Housing Finance &
Development Authority, Refunding Revenue
Bonds (Series A), 6.15%, 7/1/2008 AA $ 1,035,821
1,200,000 South Carolina State Housing Finance &
Development Authority, Revenue Bonds (Series
A), 7.30% (FHA/VA mtgs GTD), 7/1/2011 AA 1,275,000
1,000,000 South Carolina State Housing Finance &
Development Authority, Revenue Bonds (Series
A-1), 6.45% (FHA/VA mtgs GTD), 7/1/2017 Aa2 1,064,150
500,000 South Carolina State Housing Finance &
Development Authority, Revenue Bonds (Series
C), 7.70% (FHA/VA mtgs GTD), 7/1/2011 AA 517,865
520,000 South Carolina State Housing Finance &
Development Authority, Revenue Bonds (Series
C), 7.75% (FHA/VA mtgs GTD), 7/1/2022 AA 540,056
30,000 South Carolina State Housing Finance &
Development Authority, Refunding Revenue
Bonds (Series A), 7.50% (FHA/VA mtgs GTD),
7/1/2011 AA 30,920
1,000,000 South Carolina State Ports Authority,
Revenue Bonds, 6.50% (AMBAC INS)/
(Original Issue Yield: 6.75%), 7/1/2006 AAA 1,058,600
1,000,000 South Carolina State Ports Authority,
Revenue Bonds, 6.625% (AMBAC INS)/
(Original Issue Yield: 6.823%), 7/1/2011 AAA 1,068,240
525,000 South Carolina State Ports Authority,
Revenue Bonds, 6.75% (AMBAC INS)/
(Original Issue Yield: 6.90%), 7/1/2021 AAA 561,251
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia South Carolina Municipal Bond Fund
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$2,495,000 South Carolina State Public Service
Authority, (Series C) Refunding Revenue
Bonds, 5.125% (Original Issue Yield: 5.47%),
1/1/2032 AAA $ 2,392,031
2,500,000 South Carolina State Public Service Authority, Revenue Refunding
Bonds, 5.00% (MBIA INS)/(Original Issue Yield: 5.20%),
1/1/2025 AAA 2,400,550
2,000,000 South Carolina State Public Service
Authority, Revenue Bond, 5.00% (MBIA INS)/
(Original Issue Yield: 5.20%), 1/1/2015 AAA 1,986,000
1,950,000 South Carolina State Public Service
Authority, Revenue Bonds (Series D), 6.50%
(Santee Cooper)/(AMBAC INS)/(Original Issue
Yield: 6.553%), 7/1/2014 AAA 2,134,743
1,000,000 South Carolina State Public Service
Authority, Refunding Revenue Bonds, 5.00%
(FGIC INS)/(Original Issue Yield: 5.30%),
1/1/2018 AAA 974,560
1,040,000 South Carolina State, (Series A) GO UT
Highway Improvement Bonds, 4.50%, 4/1/2020 AAA 958,537
1,000,000 South Carolina State, GO UT (Series A),
6.20% (Original Issue Yield: 4.75%),
2/1/2000 AAA 1,020,170
1,210,000 South Carolina State, GO UT Bonds (Series
A), 4.50% (State Highway), 4/1/2023 AAA 1,103,726
4,500,000 South Carolina State, GO UT Revenue Bonds
(Series A), 5.00% (Original Issue Yield:
5.45%), 3/1/2008 AAA 4,680,045
1,150,000 South Carolina State, GO UT, 4.50% (State
Highway), 4/1/2022 AAA 1,052,388
1,000,000 South Carolina State, GO UT, 5.75% (Original
Issue Yield: 4.70%), 8/1/2003 AAA 1,071,580
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$ 590,000 South Carolina State, State Capital
Improvement (Series B), 5.75%, 8/1/2000 AAA $ 606,632
2,000,000 South Carolina Transportation Infrastructure
Bank, Revenue Bonds, 4.50% (MBIA INS),
10/1/2014 AAA 1,890,560
1,500,000 Spartanburg County, SC Health Services
District, Inc., Refunding Revenue Bonds,
5.50% (AMBAC INS)/
(Original Issue Yield: 5.70%), 4/15/2015 AAA 1,543,830
1,500,000 Spartanburg County, SC Health Services
District, Inc., Revenue Bonds, 5.50% (MBIA
INS)/(Original Issue Yield: 6.00%),
4/15/2027 AAA 1,534,920
1,000,000 Spartanburg County, SC Hospital Facilities,
Revenue Refunding Bonds, 6.55% (Spartanburg
General Hospital System)/(FSA INS),
4/15/2010 AAA 1,078,550
450,000 Spartanburg, SC Leased Housing Corp.,
Refunding Revenue Bonds, 7.50%, 10/1/2011 A2 481,901
1,000,000 Spartanburg, SC Waterworks, Refunding
Revenue Bonds, 5.00% (FGIC INS), 6/1/2027 AAA 958,580
1,000,000 Sumter County, SC Hospital Facilities,
Refunding Revenue Bonds, 6.625% (Tuomey
Regional Medical Center)/
(MBIA INS)/(Original Issue Yield: 6.98%),
11/15/2004 AAA 1,117,540
1,000,000 University South Carolina, Parking
Facilities Refunding Revenue Bonds, 5.00%
(MBIA INS)/(Original Issue Yield: 5.40%),
5/1/2015 AAA 992,910
1,465,000 University of South Carolina, Revenue Bonds,
5.70% (MBIA INS), 6/1/2020 AAA 1,534,646
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia South Carolina Municipal Bond Fund
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$1,300,000 Western Carolina Regional Sewer Authority,
SC, Sewer System Revenue Bonds, 5.50% (FGIC
INS)/(Original Issue Yield: 5.627%),
3/1/2010 AAA $ 1,368,575
1,000,000 York County, SC, GO UT Refunding Bonds,
4.90% (AMBAC INS)/(Original Issue Yield:
5.10%), 6/1/2010 AAA 1,006,390
------------
Total 120,373,929
------------
Puerto Rico--0.9%
10,000 Puerto Rico Commonwealth Infrastructure Financing Authority, Revenue
Bonds (Series A), 5.00% (AMBAC LOC)/(Original Issue Yield:
5.28%), 7/1/2028 AAA 9,738
1,080,000 Puerto Rico Electric Power Authority,
Revenue Bonds (Series DD), 5.00% (MBIA
INS)/(Original Issue Yield: 5.28%), 7/1/2028 AAA 1,051,682
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Credit
or Shares Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
Puerto Rico--continued
$ 60,000 Puerto Rico Highway and Transportation Authority, Refunding
Revenue Bonds (Series A), 5.00% (AMBAC LOC)/(Original Issue Yield:
5.16%), 7/1/2028 AAA $ 58,427
------------
Total 1,119,847
------------
Total Long-Term Municipals (identified cost
$116,301,753) 121,493,776
------------
Open-End Investment Companies--6.4%
1,263,078 AIM Global Management Money Market Fund 1,263,078
819,258 Dreyfus Tax Exempt Money Market Fund 819,258
6,258,296 Fidelity Tax Exempt Money Market Fund 6,259,296
------------
Total Open-End Investment Companies
(at net asset value) 8,341,632
------------
Total Investments (identified cost
$124,643,385) $129,835,408
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Virginia Municipal Bond Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--96.8%
Virginia--96.7%
$ 500,000 Albemarle County, VA, Refunding Revenue
Bonds, 5.50% (Original Issue Yield: 5.634%),
8/1/2006 A+ $ 528,940
850,000 Arlington County, VA, GO UT Refunding Bonds,
6.00%, 6/1/2004 AAA 926,262
1,000,000 Arlington County, VA, GO UT, 5.40% (Original
Issue Yield: 5.55%), 6/1/2015 AAA 1,031,790
1,455,000 Arlington County, VA, Refunding Bonds, 4.70%
(Original Issue Yield: 4.75%), 6/1/2006 AAA 1,498,505
2,080,000 Arlington, VA IDA, Revenue Bonds, 5.45% (The
Nature Conservancy)/(Original Issue Yield:
5.57%), 7/1/2027 Aa1 2,126,051
1,100,000 Arlington, VA IDA, Refunding Revenue Bonds,
5.30% (Arlington Hospital)/(United States
Treasury PRF)/(Original Issue Yield: 5.47%),
9/1/2003 A1 1,106,127
2,000,000 Augusta County, VA IDA, Revenue Bonds,
6.625% (Augusta Hospital Corp.)/ (AMBAC
INS)/(Original Issue Yield: 6.817%),
9/1/2012 AAA 2,161,620
1,000,000 Chesapeake Bay Bridge & Tunnel District, VA,
Refunding Revenue Bonds, 5.50% (MBIA LOC)/
(Original Issue Yield: 4.86%), 7/1/2025 AAA 1,052,100
1,000,000 Chesapeake Bay Bridge & Tunnel District, VA,
Revenue Bonds, 5.30% (FGIC INS)/(Original
Issue Yield: 5.40%), 7/1/2003 AAA 1,049,540
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
Virginia--continued
$3,000,000 Chesapeake, VA, GO UT, 5.00% (State Aid
Withholding GTD)/ (Original Issue Yield:
5.53%), 12/1/2025 AA $ 2,895,360
1,750,000 Chesapeake, VA, GO UT, 5.40% (Original Issue
Yield: 5.50%), 5/1/2008 AA 1,860,110
485,000 Chesterfield County, VA GO UT, 4.50%
(Original Issue Yield: 4.75%), 1/1/2019 AAA 449,479
1,000,000 Chesterfield County, VA, GO UT, 5.60%
(Original Issue Yield: 5.65%), 7/15/2006 AAA 1,064,870
600,000 Danville, VA, GO UT, 6.40% (Original Issue
Yield: 6.45%), 5/1/2009 A3 652,218
500,000 Danville, VA, GO UT, 6.40% (Original Issue
Yield: 6.50%), 5/1/2010 A3 543,515
1,000,000 Fairfax County, VA IDA, Refunding Revenue
Bonds, 5.00% (Inova Health System)/(AMBAC
INS)/ (Original Issue Yield: 5.30%),
8/15/2013 AAA 1,016,750
1,250,000 Fairfax County, VA IDA, Refunding Revenue
Bonds, 5.25% (Inova Health System)/(FSA
INS)/ (Original Issue Yield: 5.35%),
8/15/2019 AAA 1,269,425
1,000,000 Fairfax County, VA IDA, Refunding Revenue
Bonds, 5.25% (Inova Health System)/(Original
Issue Yield: 5.35%), 8/15/2019 AA 1,015,540
1,265,000 Fairfax County, VA Water Authority,
Refunding Revenue Bonds, 6.00% (Original
Issue Yield: 6.281%), 4/1/2022 AA 1,375,801
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Virginia Municipal Bond Fund
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
Virginia--continued
$ 735,000 Fairfax County, VA Water Authority,
Refunding Revenue Bonds, 6.00% (Original
Issue Yield: 6.281%), 4/1/2022 AAA $ 825,030
500,000 Fairfax County, VA Water Authority,
Refunding Revenue Bonds, 5.00% (Original
Issue Yield: 5.375%), 4/1/2016 AA 494,080
1,500,000 Fairfax County, VA Water Authority,
Refunding Revenue Bonds, 5.00% (Original
Issue Yield: 5.22%), 4/1/2021 AA 1,479,300
2,000,000 Fairfax County, VA Water Authority,
Refunding Revenue Bonds, 5.00% (Original
Issue Yield: 5.30%), 4/1/2029 AA 1,935,140
1,000,000 Fairfax County, VA, GO UT Refunding Bonds,
6.00% (State Aid Withholding GTD)/(Original
Issue Yield: 6.10%), 5/1/2007 AAA 1,030,790
500,000 Fairfax County, VA, GO UT, 4.50% (Original
Issue Yield: 4.426%), 6/1/2010 495,080
2,000,000 Fairfax County, VA, GO UT, 4.50% (Original
Issue Yield: 4.73%), 6/1/2014 AAA 1,912,600
1,000,000 Hampton, VA, GO UT, 5.90% (Original Issue
Yield: 6.00%), 1/15/2007 AA 1,098,370
1,000,000 Hanover County, VA IDA, Revenue Bonds, 5.50%
(Bon Secours Health System)/ (MBIA
INS)/(Original Issue Yield: 5.93%),
8/15/2025 AAA 1,019,430
1,000,000 Hanover County, VA IDA, Revenue Bonds, 5.50%
(Memorial Regional Medical Center)/(MBIA
INS)/ (Original Issue Yield: 6.00%),
8/15/2025 AAA 1,019,430
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
Virginia--continued
$1,000,000 Hanover County, VA IDA, Revenue Bonds,
6.375% (Memorial Regional Medical
Center)/(MBIA INS), 8/15/2018 AAA $ 1,154,230
2,000,000 Henrico County, VA, GO UT Refunding Bonds,
5.30% (Original Issue Yield: 5.45%),
1/15/2010 AAA 2,078,900
1,000,000 Henrico County, VA, Refunding Revenue Bonds,
6.25% (Original Issue Yield: 6.65%),
5/1/2013 AA- 1,053,160
1,000,000 James City County, VA, GO UT, 5.20% (State Aid Withholding
GTD)/(FGIC INS)/(Original
Issue Yield: 5.35%), 12/15/2010 AAA 1,034,910
500,000 Loudoun County, VA Sanitation Authority,
Revenue Bonds, 4.75% (MBIA INS), 1/1/2021 AAA 468,220
1,000,000 Loudoun County, VA Sanitation Authority,
Revenue Bonds, 4.75% (MBIA INS)/(Original
Issue Yield: 5.04%), 1/1/2030 AAA 916,420
1,000,000 Manassas, VA, GO UT, 5.00% (Original Issue
Yield: 5.05%), 1/1/2012 AA- 1,009,380
1,000,000 Newport News, VA, GO UT (Series A), 5.20%
(Original Issue Yield: 5.35%), 1/15/2018 AA 1,014,170
1,000,000 Newport News, VA, GO UT (Series A), 6.00%
(Original Issue Yield: 6.05%), 6/1/2006 AA 1,068,700
1,000,000 Newport News, VA, GO UT (Series A), 6.00%
(Original Issue Yield: 6.10%), 6/1/2007 AA 1,070,930
1,900,000 Norfolk, VA IDA, Refunding Revenue Bonds,
5.50% (Sentara Hospitals), 11/1/2017 AA 1,935,245
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Virginia Municipal Bond Fund
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- ------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
Virginia--continued
$1,000,000 Norfolk, VA IDA, Refunding Revenue Bonds,
6.50% (Daughter's Charity-DePaul Hospital),
12/1/2007 AA+ $ 1,092,270
2,500,000 Norfolk, VA IDA, Refunding Revenue Bonds,
6.50% (Sentara Hospitals), 11/1/2013 AA 2,779,400
1,000,000 Norfolk, VA IDA, Revenue Bonds, 6.50%
(Children's Hospital King's Group)/
(AMBAC INS)/(Original Issue Yield: 7.043%),
6/1/2021 AAA 1,063,610
500,000 Norfolk, VA Water Revenue, Revenue Bonds,
5.90% (MBIA INS)/
(Original Issue Yield: 6.194%), 11/1/2025 AAA 536,500
1,000,000 Norfolk, VA, GO UT (Series A), 5.90%
(Original Issue Yield: 6.00%), 2/1/2006 AA 1,054,360
1,000,000 Norfolk, VA, GO UT Refunding Bonds (Series
A), 6.00% (Original Issue Yield: 6.20%),
2/1/2008 AA 1,055,970
1,000,000 Norfolk, VA, GO UT Refunding Bonds, 5.25%
(Original Issue Yield: 5.35%), 2/1/2006 AA 1,046,050
2,000,000 Norfolk, VA, GO UT Refunding Bonds, 5.50%
(Original Issue Yield: 5.55%), 2/1/2008 AA 2,098,540
1,000,000 Prince William County, VA, GO UT Refunding
Bonds, 5.90% (Original Issue Yield: 6.00%),
12/1/2003 AA 1,054,790
2,000,000 Richmond, VA Public Utility, Refunding
Revenue Bonds (Series A), 5.125% (Original
Issue Yield: 5.31%), 1/15/2028 A+ 1,938,580
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- ------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
Virginia--continued
$1,500,000 Richmond, VA, GO UT Bonds, 5.50% (State Aid
Withholding INS)/(Original Issue Yield:
5.72%), 7/15/2023 AA $ 1,532,340
1,000,000 Richmond, VA, GO UT Refunding Bonds (Series B), 5.00% (FGIC
INS)/(Original Issue Yield:
5.259%), 1/15/2021 AAA 972,250
1,000,000 Rivanna Water & Sewer Authority, Refunding
Revenue Bonds, 4.80% (Original Issue Yield:
5.10%), 10/1/2015 Aa3 971,800
500,000 Roanoke County, VA Water System, Refunding
Revenue Bonds, 5.00% (FGIC INS), 7/1/2021 AAA 483,425
2,000,000 Roanoke, VA IDA, 5.25% (Roanoke Memorial
Hospital Project--Carilion Health
System)/(MBIA INS)/(Original Issue Yield:
5.65%), 7/1/2025 AAA 1,967,800
3,475,000 Roanoke, VA, GO UT Bonds, 5.25% (Original
Issue Yield: 5.30%), 8/1/2024 AA 3,462,699
1,000,000 Roanoke, VA, GO UT Bonds, 6.20%, 8/1/2005 AA 1,060,630
1,250,000 Roanoke, VA, GO UT Bonds, 6.30% (Original
Issue Yield: 6.35%), 8/1/2007 AA 1,334,150
1,000,000 Spotsylvania County, VA, GO UT Bonds, 5.50%
(Original Issue Yield: 5.55%), 7/15/2005 A+ 1,063,630
1,000,000 Spotsylvania County, VA, GO UT Bonds, 5.70%
(Original Issue Yield: 5.75%), 7/15/2007 A+ 1,069,470
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Virginia Municipal Bond Fund
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
Virginia--continued
$1,500,000 University of Virginia, Refunding Revenue
Bonds (Series A), 5.20% (Original Issue
Yield: 5.45%), 6/1/2015 AA+ $ 1,511,295
3,800,000 Upper Occoquan Sewage Authority, VA, (Series
A), 4.75% (MBIA LOC)/
(Original Issue Yield: 5.30%), 7/1/2029 AAA 3,511,314
1,000,000 Virginia Beach, VA, GO UT Bonds (Series C),
6.10% (Original Issue Yield: 6.15%),
8/1/2002 AA 1,064,450
1,000,000 Virginia Beach, VA, GO UT Bonds, 5.70%,
7/15/2006 AA 1,071,000
1,000,000 Virginia Beach, VA, GO UT Bonds, 5.80%,
7/15/2007 AA 1,073,920
1,000,000 Virginia Beach, VA, GO UT Refunding Bonds,
6.20% (State Aid Withholding INS)/(Original
Issue Yield: 6.25%), 9/1/2014 AA 1,113,750
1,000,000 Virginia College Building Authority,
Refunding Revenue Bonds, 5.80% (Washington &
Lee University Project), 1/1/2024 AAA 1,086,390
1,500,000 Virginia Polytechnical Institute & State
University, Refunding Revenue Bonds (Series
C), 5.50% (Original Issue Yield: 5.70%),
6/1/2016 AA 1,547,820
500,000 Virginia State Housing Development
Authority, Refunding Revenue Bonds, 6.10%,
1/1/2007 AA+ 528,545
500,000 Virginia State Housing Development
Authority, Refunding Revenue Bonds, 6.20%,
1/1/2008 AA+ 532,940
500,000 Virginia State Housing Development
Authority, Refunding Revenue Bonds, 6.30%,
1/1/2009 AA+ 533,615
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
Virginia--continued
$ 400,000 Virginia State Housing Development
Authority, Refunding Revenue Bonds, 6.45%,
5/1/2001 AA+ $ 411,528
990,000 Virginia State Housing Development
Authority, Revenue Bonds (Series A), 6.40%,
7/1/2017 AA+ 1,042,203
1,000,000 Virginia State Housing Development
Authority, Revenue Bonds (Series B), 6.35%,
1/1/2015 AA+ 1,074,200
1,000,000 Virginia State Housing Development
Authority, Revenue Bonds (Series B), 6.55%,
1/1/2011 AA+ 1,075,580
875,000 Virginia State Housing Development
Authority, Revenue Bonds (Series F), 6.40%,
7/1/2017 AA+ 919,966
1,000,000 Virginia State Public School Authority,
Refunding Revenue Bonds, 6.25% (Original
Issue Yield: 6.30%), 1/1/2004 AA 1,071,850
300,000 Virginia State Public School Authority,
School Financing Revenue Bonds (Series B),
5.75% (State Aid Withholding COL), 1/1/2008 AA 321,132
250,000 Virginia State Resource Authority Sewer
System, Refunding Revenue Bonds, 5.00%
(Original Issue Yield: 5.182%), 5/1/2022 AA 241,230
1,000,000 Virginia State Resources Authority Water and
Sewer System, Refunding Revenue Bonds, 5.25%
(Appomattox River Water Authority)/
(Original Issue Yield: 5.70%), 10/1/2013 AA 1,022,370
1,000,000 Virginia State Resources Authority Water and
Sewer System, Revenue Bonds (Series A),
5.60% (Original Issue Yield: 5.75%),
10/1/2025 AA 1,082,600
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Virginia Municipal Bond Fund
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
Virginia--continued
$ 690,000 Virginia State Resources Authority Water and
Sewer System, Revenue Bonds, 5.50% (Original
Issue Yield: 5.80%), 10/1/2022 AA $ 704,407
1,000,000 Virginia State, GO UT Bonds, 5.50% (Original
Issue Yield: 5.55%), 6/1/2006 AAA 1,063,850
1,000,000 Virginia State, GO UT Bonds, 6.00%, 6/1/2006 AAA 1,060,960
690,000 Washington County, VA IDA, Refunding Revenue
Bonds, 6.00% (Original Issue Yield: 6.16%),
7/1/2014 A2 761,525
------------
Total 100,804,222
------------
Puerto Rico--0.1%
45,000 Puerto Rico Commonwealth Infrastructure Financing Authority, Revenue
Bonds (Series A), 5.00% (AMBAC LOC)/(Original Issue Yield:
5.28%), 7/1/2028 AAA 43,820
40,000 Puerto Rico Electric Power Authority,
Revenue Bonds (Series DD), 5.00% (MBIA
INS)/(Original Issue Yield: 5.28%), 7/1/2028 AAA 38,951
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Credit
or Shares Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
Puerto Rico--continued
$ 45,000 Puerto Rico Highway and Transportation Authority, Refunding
Revenue Bonds (Series A), 5.00% (AMBAC LOC)/(Original Issue Yield:
5.16%), 7/1/2028 AAA $ 43,820
------------
Total 126,591
------------
Total Long-Term Municipals (identified cost
$96,120,734) 100,930,813
------------
Open-End Investment Companies--3.8%
57,288 Dreyfus Tax Exempt Money Market 57,288
3,909,487 Fidelity Tax Exempt Money Market 3,909,487
------------
Total Open-End Investment Companies (at net
asset value) 3,966,775
------------
Total Investments (identified cost
$100,087,509) $104,897,588
------------
</TABLE>
(See Notes to Portfolios of Investments)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Notes to Portfolios of Investments
* Please refer to the Appendix of the Statement of Additional Information for
an explanation of the credit ratings. Current credit ratings are unaudited.
(1) Non-income producing.
(2) Represents securities held as collateral within a margin account, used to
ensure the fund is able to satisfy the obligations of its outstanding long
futures contracts.
(3) The repurchase agreements are fully collateralized by U.S. Government and/or
agency obligations based on market prices at the date of the portfolio.
(4) Denotes a restricted security which is subject to restrictions on resale
under federal securities laws. These securities have been deemed liquid
based upon criteria approved by the fund's Board of Trustees. At May 31,
1999, Emerging Markets Fund held restricted securities amounting to
$5,883,743, which represents 3.5% of net assets.
The following abbreviations are used in these portfolios:
ADR--American Depository Receipt INS--Insured
AMBAC--American Municipal Bond LOC--Letter of Credit
Assurance Corporation LT--Limited Tax
AMT--Alternative Minimum Tax LTD--Limited
CGIC--Capital Guaranty Insurance MBIA--Municipal Bond Investors
Corporation Assurance
COL--Collateralized MTN--Medium Term Note
FGIC--Financial Guaranty Insurance PCFA--Pollution Control Finance
Corporation Authority
FHA--Federal Housing Administration PCR--Pollution Control Revenue
FNMA--Federal National Mortgage PO--Principal Only
Association PRF--Prerefunded
FSA--Financial Security Assurance REMIC--Real Estate Mortgage
GDR--Global Depository Receipt Investment Conduit
GO--General Obligation SFM--Single Family Mortgage
GTD--Guaranteed UT--Unlimited Tax
HFA--Housing Finance Authority VA--Veterans Administration
IDA--Industrial Development VRDNs--Variable Rate Demand Notes
Authority
IFA--Industrial Finance Authority
<TABLE>
<CAPTION>
Net Unrealized Gross Gross
Cost of Appreciation/ Unrealized Unrealized
Investments (Depreciation) Appreciation Depreciation
for Federal for Federal for Federal for Federal Total Net
Fund Tax Purposes Tax Purposes Tax Purposes Tax Purposes Assets**
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Equity Fund 241,910,212 62,602,102 66,000,073 3,397,971 303,722,426
Quantitative Equity Fund 226,041,244 106,868,892 110,867,504 3,998,612 333,766,377
Growth & Income Fund 186,400,328 142,252,115 143,650,431 1,398,316 329,087,500
Equity Index Fund 269,889,131 236,694,997 241,483,205 4,788,208 506,502,378
Special Value Fund 161,004,304 7,889,526 22,360,177 14,470,651 169,080,943
Emerging Markets Fund 156,231,226 12,578,855 35,015,108 22,436,253 169,359,927
Balanced Fund 328,957,985 54,480,948 59,990,675 5,509,727 384,311,764
Fixed Income Fund 291,063,825 (4,647,712) 1,519,895 6,167,607 284,108,479
Intermediate Fixed
Income Fund 85,418,578 (1,095,046) 543,598 1,638,644 83,278,313
Short-Term Fixed Income
Fund 43,867,539 (153,828) 189,859 343,687 44,223,539
Georgia Municipal Bond
Fund 25,787,945 622,569 780,184 157,615 26,779,814
North Carolina Municipal
Bond Fund 80,147,797 2,087,748 2,390,389 302,641 79,204,277
South Carolina Municipal
Bond Fund 124,643,385 5,192,023 5,613,262 421,239 131,347,079
Virginia Municipal Bond
Fund 100,087,509 4,810,079 5,104,800 294,721 104,260,153
</TABLE>
** The categories of investments are shown as a percentage of net assets at May
31, 1999.
At May 31, 1999, the following funds had investments that were subject to
alternative minimum tax:
<TABLE>
<CAPTION>
Percentage of total market value
Fund subject to alternative minimum tax
- ------------------------------------------------------------
<S> <C>
Georgia Municipal Bond
Fund 1.98%
North Carolina Municipal
Bond Fund 1.84%
South Carolina Municipal
Bond Fund 7.97%
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds and The Wachovia Municipal Funds
Statements of Assets and Liabilities
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Wachovia Wachovia Wachovia Wachovia Wachovia Wachovia
Wachovia Quantitative Growth & Equity Index Special Values Emerging Balanced
Equity Fund Equity Fund Income Fund Fund Fund Markets Fund Fund
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments in
securities, at
value $284,733,260 $309,444,481 $315,549,459 $470,791,624 $144,167,521 $166,683,423 $362,096,395
Investments in
repurchase agree-
ments 19,779,054 23,465,655 13,102,984 35,792,504 24,726,309 2,142,176 21,342,538
Cash denominated
in foreign cur-
rencies -- -- -- -- -- 631,241 --
Income receivable 301,436 403,278 226,424 721,838 230,047 444,040 2,348,041
Receivable for
investments sold 2,667,687 5,494,236 2,595,721 66,023 594,217 726,518 3,552,004
Receivable for
shares sold 14,282,474 1,409,156 318,251 729,565 236,574 25,722 657,960
Receivable for
daily variation
margin 248,700 204,100 102,842 516,642 25,000 -- 75,013
Deferred organi-
zational costs -- -- -- -- -- 8,894 --
Other assets -- -- -- -- -- 4,775 --
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total assets 322,012,611 340,420,906 331,895,681 508,618,196 169,979,668 170,666,789 390,071,951
------------ ------------ ------------ ------------ ------------ ------------ ------------
Liabilities:
Payable for in-
vestments pur-
chased 3,532,755 5,447,577 2,426,390 693,118 518,041 870,534 5,003,765
Payable for
shares redeemed 14,505,596 908,842 72,820 939,357 195,455 32,123 339,369
Accrued expenses 251,834 298,110 308,971 483,343 185,229 404,205 417,053
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total liabili-
ties 18,290,185 6,654,529 2,808,181 2,115,818 898,725 1,306,862 5,706,187
------------ ------------ ------------ ------------ ------------ ------------ ------------
Net Assets Con-
sist of:
Paid in capital 236,075,893 204,005,562 145,400,938 263,037,861 152,861,040 189,167,157 318,350,271
Net unrealized
appreciation
(depreciation)
of investments,
futures
contracts, and
translation of
assets and
liabilities in
foreign currency 63,197,520 107,447,029 142,943,860 235,999,108 8,562,876 12,583,358 54,773,766
Accumulated net
realized gain
(loss) on
investments,
futures, and
foreign currency
transactions 4,336,509 22,086,319 40,520,992 6,501,560 6,090,035 (32,907,913) 9,661,852
Undistributed net
investment income 112,504 227,467 221,710 963,849 1,566,992 517,325 1,525,875
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total Net Assets $303,722,426 $333,766,377 $329,087,500 $506,502,378 $169,080,943 $169,359,927 $384,311,764
------------ ------------ ------------ ------------ ------------ ------------ ------------
Net Assets
Class A Shares $107,766,555 $ 85,941,105 $139,008,724 $166,027,246 $ 68,761,790 $ 14,485,091 $194,237,155
------------ ------------ ------------ ------------ ------------ ------------ ------------
Class B Shares $ 7,101,452 $ 22,843,641 -- -- $ 114,286 -- $ 18,035,685
------------ ------------ ------------ ------------ ------------ ------------ ------------
Class Y Shares $188,854,419 $224,981,631 $190,078,776 $340,475,132 $100,204,867 $154,874,836 $172,038,924
------------ ------------ ------------ ------------ ------------ ------------ ------------
Shares Outstand-
ing
Class A Shares 6,907,801 4,071,917 6,135,896 6,751,737 4,235,158 1,441,223 14,860,746
Class B Shares 456,782 1,084,947 -- -- 7,029 -- 1,383,855
Class Y Shares 12,100,166 10,639,745 8,386,445 13,825,725 6,162,890 15,414,051 13,147,797
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total Shares
Outstanding 19,464,749 15,796,609 14,522,341 20,577,462 10,405,077 16,855,274 29,392,398
------------ ------------ ------------ ------------ ------------ ------------ ------------
Net Asset Value
Per Share
Class A Shares $ 15.60 $ 21.11 $ 22.66 $ 24.59 $ 16.24 $ 10.05 $ 13.07
------------ ------------ ------------ ------------ ------------ ------------ ------------
Class B Shares $ 15.55 $ 21.06 -- -- $ 16.26 -- $ 13.03
------------ ------------ ------------ ------------ ------------ ------------ ------------
Class Y Shares $ 15.61 $ 21.15 $ 22.67 $ 24.63 $ 16.26 $ 10.05 $ 13.09
------------ ------------ ------------ ------------ ------------ ------------ ------------
Offering Price
Per Share*
Class A Shares $ 16.34** $ 22.10** $ 23.73** $ 25.75** $ 17.01** $ 10.52** $ 13.69**
------------ ------------ ------------ ------------ ------------ ------------ ------------
Class B Shares $ 15.55 $ 21.06 -- -- $ 16.26 -- $ 13.03
------------ ------------ ------------ ------------ ------------ ------------ ------------
Class Y Shares $ 15.61 $ 21.15 $ 22.67 $ 24.63 $ 16.26 $ 10.05 $ 13.09
------------ ------------ ------------ ------------ ------------ ------------ ------------
Redemption Pro-
ceeds Per Share*
Class A Shares $ 15.60 $ 21.11 $ 22.66 $ 24.59 $ 16.24 $ 10.05 $ 13.07
------------ ------------ ------------ ------------ ------------ ------------ ------------
Class B Shares $ 14.77*** $ 20.01*** -- -- $ 15.45*** -- $ 12.38***
------------ ------------ ------------ ------------ ------------ ------------ ------------
Class Y Shares $ 15.61 $ 21.15 $ 22.67 $ 24.63 $ 16.26 $ 10.05 $ 13.09
------------ ------------ ------------ ------------ ------------ ------------ ------------
Investments, at
identified cost 241,910,212 226,041,244 186,400,328 269,889,131 161,004,304 156,231,226 328,957,985
------------ ------------ ------------ ------------ ------------ ------------ ------------
Investments, at
tax cost 241,910,212 226,041,244 186,400,328 269,889,131 161,004,304 156,231,226 328,957,985
------------ ------------ ------------ ------------ ------------ ------------ ------------
</TABLE>
* See "What do Shares Cost?" in the Prospectus.
** Computation of Offering Price: 100\95.50 of net asset value.
*** Computation of Redemption Proceeds: 95\100 of net asset value.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds and The Wachovia Municipal Funds
Statements of Assets and Liabilities--Continued
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Wachovia Wachovia
Wachovia Wachovia Wachovia North South Wachovia
Wachovia Intermediate Short Term Georgia Carolina Carolina Virginia
Fixed Income Fixed Income Fixed Income Municipal Municipal Municipal Municipal
Fund Fund Fund Bond Fund Bond Fund Bond Fund Bond Fund
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments in
securities, at
value $270,969,406 $83,960,892 $43,029,188 $26,410,514 $82,235,545 $129,835,408 $104,897,588
Investments in
repurchase
agreements 15,446,707 362,640 684,523 -- -- -- --
Income receivable 3,682,308 436,462 528,414 459,654 536,242 2,092,777 1,856,832
Receivable for
investments sold -- 341,087 -- -- -- -- --
Receivable for
shares sold 649,107 79,962 71,564 109,553 20,000 2,296 --
Receivable for
daily variation
margin 20,464 -- -- -- -- -- --
Deferred
organizational
costs -- -- -- 4,822 8,168 -- --
Other assets 3,467 -- -- 7,735 6,190 -- --
------------ ----------- ----------- ----------- ----------- ------------ ------------
Total assets 290,771,459 85,181,043 44,313,689 26,992,278 82,806,145 131,930,481 106,754,420
------------ ----------- ----------- ----------- ----------- ------------ ------------
Liabilities:
Payable for
investments
purchased 5,008,975 1,761,903 -- -- -- -- --
Payable for
shares redeemed 539,572 13,650 300 100,005 181,124 4,610 43,796
Income
distribution
payable -- -- -- 84,784 249,575 487,086 400,805
Payable to bank -- -- -- -- 3,124,886 -- 1,988,119
Payable for daily
variation margin -- 1,938 -- -- -- -- --
Accrued expenses 1,114,433 125,239 89,850 27,675 46,283 91,706 61,547
------------ ----------- ----------- ----------- ----------- ------------ ------------
Total
liabilities 6,662,980 1,902,730 90,150 212,464 3,601,868 583,402 2,494,267
------------ ----------- ----------- ----------- ----------- ------------ ------------
Net Assets
Consist of:
Paid in capital 288,487,130 83,796,833 47,310,254 26,113,844 77,104,020 126,084,394 100,605,502
Net unrealized
appreciation
(depreciation)
of investments,
futures
contracts, and
translation of
assets and
liabilities in
foreign currency (4,456,498) (1,070,390) (153,828) 622,569 2,087,748 5,192,023 4,810,079
Accumulated net
realized gain
(loss) on
investments,
futures, and
foreign currency
transactions 96,243 471,705 (3,021,543) 44,618 12,017 70,347 (1,148,160)
Undistributed
(distributions
in excess of)
net investment
income (18,396) 80,165 88,656 (1,217) 492 315 (7,268)
------------ ----------- ----------- ----------- ----------- ------------ ------------
Total Net
Assets $284,108,479 $83,278,313 $44,223,539 $26,779,814 $79,204,277 $131,347,079 $104,260,153
------------ ----------- ----------- ----------- ----------- ------------ ------------
Net Assets
Class A Shares $ 66,760,986 $ 3,997,875 $10,140,341 $ 6,668,042 $ 9,698,377 $ 66,459,689 $ 8,559,583
------------ ----------- ----------- ----------- ----------- ------------ ------------
Class B Shares $ 842,436 -- -- -- -- -- --
------------ ----------- ----------- ----------- ----------- ------------ ------------
Class Y Shares $216,505,057 $79,280,438 $34,083,198 $20,111,772 $69,505,900 $ 64,887,390 $ 95,700,570
------------ ----------- ----------- ----------- ----------- ------------ ------------
Shares
Outstanding
Class A Shares 6,845,452 408,050 1,043,909 599,069 867,302 5,985,805 831,431
Class B Shares 86,408 -- -- -- -- -- --
Class Y Shares 22,207,808 8,090,674 3,508,946 1,806,671 6,216,352 5,844,393 9,295,830
------------ ----------- ----------- ----------- ----------- ------------ ------------
Total Shares
Outstanding 29,139,668 8,498,724 4,552,855 2,405,740 7,083,654 11,830,198 10,127,261
------------ ----------- ----------- ----------- ----------- ------------ ------------
Net Asset Value
Per Share
Class A Shares $ 9.75 $ 9.80 $ 9.71 $ 11.13 $ 11.18 $ 11.10 $ 10.30
------------ ----------- ----------- ----------- ----------- ------------ ------------
Class B Shares $ 9.75 -- -- -- -- -- --
------------ ----------- ----------- ----------- ----------- ------------ ------------
Class Y Shares $ 9.75 $ 9.80 $ 9.71 $ 11.13 $ 11.18 $ 11.10 $ 10.30
------------ ----------- ----------- ----------- ----------- ------------ ------------
Offering Price
Per Share*
Class A Shares $ 10.21** $ 10.26** $ 9.96*** $ 11.65** $ 11.71** $ 11.62** $ 10.79**
------------ ----------- ----------- ----------- ----------- ------------ ------------
Class B Shares $ 9.75 -- -- -- -- -- --
------------ ----------- ----------- ----------- ----------- ------------ ------------
Class Y Shares $ 9.75 $ 9.80 $ 9.71 $ 11.13 $ 11.18 $ 11.10 $ 10.30
------------ ----------- ----------- ----------- ----------- ------------ ------------
Redemption
Proceeds Per
Share*
Class A Shares $ 9.75 $ 9.80 $ 9.71 $ 11.13 $ 11.18 $ 11.10 $ 10.30
------------ ----------- ----------- ----------- ----------- ------------ ------------
Class B Shares $ 9.26**** -- -- -- -- -- --
------------ ----------- ----------- ----------- ----------- ------------ ------------
Class Y Shares $ 9.75 $ 9.80 $ 9.71 $ 11.13 $ 11.18 $ 11.10 $ 10.30
------------ ----------- ----------- ----------- ----------- ------------ ------------
Investments, at
identified cost 291,063,825 85,418,578 43,867,539 25,787,945 80,147,797 124,643,385 100,087,509
------------ ----------- ----------- ----------- ----------- ------------ ------------
Investments, at
tax cost 291,063,825 85,418,578 43,867,539 25,787,945 80,147,797 124,643,385 100,087,509
------------ ----------- ----------- ----------- ----------- ------------ ------------
</TABLE>
* See "What do Shares Cost?" in the Prospectus.
** Computation of Offering Price: 100\95.50 of net asset value.
*** Computation of Offering Price: 100\97.50 of net asset value.
**** Computation of Redemption Proceeds: 95\100 of net asset value.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds
The Wachovia Municipal Funds
Statements of Operations
Six Months Ended May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Wachovia Wachovia Wachovia Wachovia Wachovia
Wachovia Quantitative Growth & Equity Special Emerging Wachovia
Equity Equity Income Index Values Markets Balanced
Fund Fund Fund Fund Fund Fund Fund
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment Income:
Dividends $ 1,269,394 $ 1,924,035 $ 1,995,474 $ 2,909,414 $ 2,014,837 $ 1,746,392 $ 1,302,469
Interest 924,067 884,467 362,858 1,310,699 551,780 123,832 5,726,589
----------- ----------- ------------ ----------- ----------- ----------- -----------
Total income 2,193,461 2,808,502 2,358,332 4,220,113 2,566,617 1,870,224 7,029,058
----------- ----------- ------------ ----------- ----------- ----------- -----------
Expenses:
Investment advisory fee 970,275 1,155,137 1,163,395 715,042 613,939 744,158 1,482,944
Administrative personnel
and services fee 123,539 146,135 148,249 212,457 68,356 66,323 188,992
Custodian fees 27,019 30,817 31,163 41,899 15,331 184,053 38,010
Transfer and dividend
disbursing agent fees
and expenses 12,507 24,010 18,724 13,213 17,315 21,468 12,501
Directors'/Trustees'
fees 1,906 2,266 5,444 4,188 859 3,584 3,056
Auditing fees 7,619 7,449 7,690 7,759 7,362 9,031 7,127
Legal fees 2,043 3,316 9,544 4,114 3,243 12,055 5,970
Portfolio accounting
fees 716 419 9,584 2,109 317 2,836 3,940
Distribution services
fee--Class B Shares 24,626 81,240 -- -- 67 -- 61,178
Shareholder services
fee--Class A Shares 95,659 107,379 171,510 191,815 78,244 14,081 232,306
Shareholder services
fee--Class B Shares 8,209 27,080 -- -- 22 -- 20,392
Share registration costs 13,467 13,744 18,591 17,730 7,769 14,763 8,800
Printing and postage 7,239 7,211 10,311 4,586 5,351 6,594 7,069
Insurance premiums 2,244 2,360 2,388 2,244 1,745 2,151 2,390
Miscellaneous 686 10,600 6,299 4,490 4,611 8,783 7,145
----------- ----------- ------------ ----------- ----------- ----------- -----------
Total expenses 1,297,754 1,619,163 1,602,892 1,221,646 824,531 1,089,880 2,081,820
----------- ----------- ------------ ----------- ----------- ----------- -----------
Waivers and
reimbursements--
Waiver of investment
advisory fee -- -- -- -- -- (4,364) (152,051)
----------- ----------- ------------ ----------- ----------- ----------- -----------
Net expenses 1,297,754 1,619,163 1,602,892 1,221,646 824,531 1,085,516 1,929,769
----------- ----------- ------------ ----------- ----------- ----------- -----------
Net investment income 895,707 1,189,339 755,440 2,998,467 1,742,086 784,708 5,099,289
----------- ----------- ------------ ----------- ----------- ----------- -----------
Realized and Unrealized
Gain (Loss) on
Investments:
Net realized gain (loss)
on investments, futures
contracts and foreign
currency transactions 10,543,321 25,960,519 42,413,155 13,910,426 7,595,651 (3,273,439) 15,885,407
Net change in unrealized
appreciation
(depreciation) of
investments, futures
contracts and
translation of assets
and liabilities in
foreign currency 16,256,570 (1,171,999) (12,166,623) 35,387,803 1,537,510 30,372,244 5,212,342
----------- ----------- ------------ ----------- ----------- ----------- -----------
Net realized and
unrealized gain (loss)
on investments,
futures contracts and
foreign currency 26,799,891 24,788,520 30,246,532 49,298,229 9,133,161 27,098,805 21,097,749
----------- ----------- ------------ ----------- ----------- ----------- -----------
Change in net assets
resulting from
operations $27,695,598 $25,977,859 $ 31,001,972 $52,296,696 $10,875,247 $27,883,513 $26,197,038
----------- ----------- ------------ ----------- ----------- ----------- -----------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds
The Wachovia Municipal Funds
Statements of Operations--Continued
Six Months Ended May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Wachovia Wachovia
Wachovia Wachovia Wachovia North South Wachovia
Wachovia Intermediate Short Term Georgia Carolina Carolina Virginia
Fixed Income Fixed Income Fixed Income Municipal Municipal Municipal Municipal
Fund Fund Fund Bond Fund Bond Fund Bond Fund Bond Fund
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment Income:
Dividends $ 403,510 $ 143,722 $ 44,317 $ -- $ -- $ -- $ --
Interest 7,461,201 2,550,478 1,858,266 615,259 1,666,583 3,276,726 2,775,938
----------- ----------- ----------- --------- ----------- ----------- -----------
Total income 7,864,711 2,694,200 1,902,583 615,259 1,666,583 3,276,726 2,775,938
----------- ----------- ----------- --------- ----------- ----------- -----------
Expenses:
Investment advisory fee 774,188 267,345 181,157 96,368 262,929 468,144 393,098
Administrative personnel
and services fee 114,417 39,762 29,491 11,456 30,979 55,661 47,380
Custodian fees 25,486 8,911 6,588 2,570 7,011 12,484 10,624
Transfer and dividend
disbursing agent fees
and expenses 8,640 7,153 5,161 3,627 5,247 8,043 8,353
Directors'/Trustees'
fees 2,597 1,369 1,443 819 519 1,392 1,900
Auditing fees 7,642 3,793 7,651 7,730 7,401 7,637 4,398
Legal fees 5,172 1,216 3,065 3,289 2,929 3,049 5,566
Portfolio accounting
fees 8,732 165 2,206 4,265 7,345 3,811 387
Distribution services
fee--Class B Shares 2,741 -- -- -- -- -- --
Shareholder services
fee--Class A Shares 55,969 5,527 12,814 8,528 12,071 84,200 11,017
Shareholder services
fee--Class B Shares 914 -- -- -- -- -- --
Share registration costs 12,661 11,586 9,596 9,383 11,111 10,552 16,057
Printing and postage 4,889 9,400 6,374 5,256 6,371 6,181 7,995
Insurance premiums 2,244 1,208 1,745 1,496 1,745 1,745 1,402
Miscellaneous 4,978 2,351 1,636 4,623 5,185 2,652 3,609
----------- ----------- ----------- --------- ----------- ----------- -----------
Total expenses 1,031,270 359,786 268,927 159,410 360,843 665,551 511,786
----------- ----------- ----------- --------- ----------- ----------- -----------
Waivers and
reimbursements--
Waiver of investment
advisory fee (27,801) (24,520) (48,609) (33,623) (51,063) (220,649) (133,547)
----------- ----------- ----------- --------- ----------- ----------- -----------
Net expenses 1,003,469 335,266 220,318 125,787 309,780 444,902 378,239
----------- ----------- ----------- --------- ----------- ----------- -----------
Net investment income 6,861,242 2,358,934 1,682,265 489,472 1,356,803 2,831,824 2,397,699
----------- ----------- ----------- --------- ----------- ----------- -----------
Realized and Unrealized
Gain (Loss) on
Investments:
Net realized gain (loss)
on investments, futures
contracts and foreign
currency transactions 199,782 472,821 534,603 59,361 32,152 72,688 456,333
Net change in unrealized
appreciation
(depreciation) of
investments, futures
contracts and
translation of assets
and liabilities in
foreign currency (9,546,147) (3,826,351) (1,249,838) (562,932) (1,462,948) (2,721,024) (2,472,485)
----------- ----------- ----------- --------- ----------- ----------- -----------
Net realized and
unrealized gain (loss)
on investments,
futures contracts and
foreign currency (9,346,365) (3,353,530) (715,235) (503,571) (1,430,796) (2,648,336) (2,016,152)
----------- ----------- ----------- --------- ----------- ----------- -----------
Change in net assets
resulting from
operations $(2,485,123) $ (994,596) $ 967,030 $ (14,099) $ (73,993) $ 183,488 $ 381,547
----------- ----------- ----------- --------- ----------- ----------- -----------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds and The Wachovia Municipal Funds
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
Wachovia
Wachovia Wachovia Growth &
Equity Fund Quantitative Equity Fund Income Fund
-------------------------- -------------------------- ---------------------------
Six-Months Six-Months Six-Months
Ended Year Ended Year Ended Year
(unaudited) Ended (unaudited) Ended (unaudited) Ended
May 31, November 30, May 31, November 30, May 31, November 30,
1999 1998 1999 1998 1999 1998
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Increase
(Decrease) in Net
Assets:
Operations--
Net investment
income $ 895,707 $ 2,562,164 $ 1,189,339 $ 3,010,939 $ 755,440 $ 2,327,051
Net realized gain
on investments,
futures
contracts and
foreign currency
transactions 10,543,321 25,423,254 25,960,519 8,106,935 42,413,155 39,310,322
Net change in
unrealized
appreciation
(depreciation)
of investments,
futures
contracts and
translation of
assets and
liabilities in
foreign currency 16,256,570 9,686,441 (1,171,999) 34,370,766 (12,166,623) 20,725,093
------------ ------------ ------------ ------------ ------------ -------------
Change in net
assets
resulting from
operations 27,695,598 37,671,859 25,977,859 45,488,640 31,001,972 62,362,466
------------ ------------ ------------ ------------ ------------ -------------
Distributions to
Shareholders--
Distributions
from net
investment
income
Class A Shares (170,886) (434,085) (290,213) (550,325) (315,992) (1,096,382)
Class B Shares (361) (9,956) (973) (38,995) -- --
Class Y Shares (796,849) (2,078,302) (993,411) (2,433,040) (716,280) (847,829)
Distributions
from net
realized gain on
investments,
futures
contracts and
foreign currency
Class A Shares (6,402,895) (4,382,604) (3,015,352) (3,354,334) (15,960,122) (16,598,781)
Class B Shares (682,857) (386,343) (720,001) (633,226) -- --
Class Y Shares (23,090,623) (17,186,819) (7,541,802) (16,891,130) (25,242,363) --
------------ ------------ ------------ ------------ ------------ -------------
Change in net
assets from
distributions
to shareholders (31,144,471) (24,478,109) (12,561,752) (23,901,050) (42,234,757) (18,542,992)
------------ ------------ ------------ ------------ ------------ -------------
Share
Transactions--
Proceeds from
sale of shares 88,045,550 79,804,293 23,186,928 85,542,784 14,524,572 228,486,710
Net asset value
of shares issued
to shareholders
in payment of
dividends
declared 24,137,409 18,768,160 11,386,420 21,884,659 20,112,915 9,768,460
Cost of shares
redeemed (64,164,674) (51,792,656) (23,779,966) (44,449,005) (30,798,931) (284,316,544)
------------ ------------ ------------ ------------ ------------ -------------
Change in net
assets from
share
transactions 48,018,285 46,779,797 10,793,382 62,978,438 3,838,556 (46,061,374)
------------ ------------ ------------ ------------ ------------ -------------
Change in net
assets 44,569,412 59,973,547 24,209,489 84,566,028 (7,368,022) (2,241,900)
Net Assets:
Beginning of
period 259,153,014 199,179,467 309,556,888 224,990,860 336,481,729 338,723,629
------------ ------------ ------------ ------------ ------------ -------------
End of period $303,722,426 $259,153,014 $333,766,377 $309,556,888 $329,087,500 $ 336,481,729
------------ ------------ ------------ ------------ ------------ -------------
Undistributed net
investment
income included
in net assets at
end of period $ 112,504 $ 184,893 $ 227,467 $ 322,725 $ 221,710 $ 498,542
------------ ------------ ------------ ------------ ------------ -------------
Net gain as
computed for
federal tax
purposes $ 10,543,321 $ 29,886,669 $ 25,960,519 $ 11,277,361 $ 42,413,155 $ 41,201,605
------------ ------------ ------------ ------------ ------------ -------------
<CAPTION>
Wachovia
Equity Index Fund
---------------------------
Six-Months
Ended Year
(unaudited) Ended
May 31, November 30,
1999 1998
- ------------------------------------------------
<S> <C> <C>
Increase
(Decrease) in Net
Assets:
Operations--
Net investment
income $ 2,998,467 $ 5,003,197
Net realized gain
on investments,
futures
contracts and
foreign currency
transactions 13,910,426 421,731
Net change in
unrealized
appreciation
(depreciation)
of investments,
futures
contracts and
translation of
assets and
liabilities in
foreign currency 35,387,803 68,214,882
------------- -------------
Change in net
assets
resulting from
operations 52,296,696 73,639,810
------------- -------------
Distributions to
Shareholders--
Distributions
from net
investment
income
Class A Shares (790,640) (3,814,497)
Class B Shares -- --
Class Y Shares (2,046,878) (945,159)
Distributions
from net
realized gain on
investments,
futures
contracts and
foreign currency
Class A Shares (2,179,495) (5,186,506)
Class B Shares -- --
Class Y Shares (4,801,448) (1,188,632)
------------- -------------
Change in net
assets from
distributions
to shareholders (9,818,461) (11,134,794)
------------- -------------
Share
Transactions--
Proceeds from
sale of shares 84,754,787 134,592,835
Net asset value
of shares issued
to shareholders
in payment of
dividends
declared 9,359,078 10,713,271
Cost of shares
redeemed (53,391,478) (83,275,340)
------------- -------------
Change in net
assets from
share
transactions 40,722,387 62,030,766
------------- -------------
Change in net
assets 83,200,622 124,535,782
Net Assets:
Beginning of
period 423,301,756 298,765,974
------------- -------------
End of period $506,502,378 $423,301,756
------------- -------------
Undistributed net
investment
income included
in net assets at
end of period $ 963,849 $ 802,900
------------- -------------
Net gain as
computed for
federal tax
purposes $ 13,910,426 $ 7,032,936
------------- -------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds and The Wachovia Municipal Funds
Statements of Changes in Net Assets--Continued
<TABLE>
<CAPTION>
Wachovia Wachovia Wachovia
Special Values Fund Emerging Markets Fund Balanced Fund
-------------------------- -------------------------- ---------------------------
Six-Months Six-Months Six-Months
Ended Year Ended Year Ended Year
(unaudited) Ended (unaudited) Ended (unaudited) Ended
May 31, November 30, May 31, November 30, May 31, November 30,
1999 1998 1999 1998 1999 1998
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Increase (Decrease) in
Net Assets:
Operations--
Net investment income $ 1,742,086 $ 1,701,412 $ 784,708 $ 1,727,317 $ 5,099,289 $ 11,937,638
Net realized gain
(loss) on investments,
futures contracts and
foreign currency
transactions 7,595,651 5,464,983 (3,273,439) (26,904,345) 15,885,407 34,803,316
Net change in
unrealized
appreciation
(depreciation) of
investments, futures
contracts and
translation of assets
and liabilities in
foreign currency 1,537,510 (15,392,292) 30,372,244 (16,292,727) 5,212,342 5,465,835
------------ ------------ ------------ ------------ ------------- ------------
Change in net assets
resulting from
operations 10,875,247 (8,225,897) 27,883,513 (41,469,755) 26,197,038 52,206,789
------------ ------------ ------------ ------------ ------------- ------------
Distributions to
Shareholders--
Distributions from net
investment income
Class A Shares (598,382) (273,707) (48,950) (79,885) (2,112,494) (2,395,836)
Class B Shares -- -- -- -- (131,445) (210,069)
Class Y Shares (1,141,203) (656,635) (1,079,581) (1,627,997) (3,119,956) (9,025,669)
Distributions from net
realized gain on
investments, futures
contracts and foreign
currency
Class A Shares (2,756,346) (3,883,188) -- -- (10,883,830) (3,838,968)
Class B Shares -- -- -- -- (1,304,941) (425,121)
Class Y Shares (4,194,343) (7,685,327) -- -- (27,272,639) (16,816,255)
------------ ------------ ------------ ------------ ------------- ------------
Change in net assets
from distributions to
shareholders (8,690,274) (12,498,857) (1,128,531) (1,707,882) (44,825,305) (32,711,918)
------------ ------------ ------------ ------------ ------------- ------------
Share Transactions--
Proceeds from sale of
shares 35,355,623 70,849,082 18,747,592 59,662,218 184,214,329 167,115,147
Net asset value of
shares issued to
shareholders in
payment of dividends
declared 7,363,140 11,067,462 385,980 616,589 42,106,334 30,283,351
Cost of shares redeemed (25,780,645) (33,500,251) (16,103,585) (25,222,374) (247,270,023) (99,971,459)
------------ ------------ ------------ ------------ ------------- ------------
Change in net assets
from share
transactions 16,938,118 48,416,293 3,029,987 35,056,433 (20,949,360) 97,427,039
------------ ------------ ------------ ------------ ------------- ------------
Change in net assets 19,123,091 27,691,539 29,784,969 (8,121,204) (39,577,627) 116,921,910
Net Assets:
Beginning of period 149,957,852 122,266,313 139,574,958 147,696,162 423,889,391 306,967,481
------------ ------------ ------------ ------------ ------------- ------------
End of period $169,080,943 $149,957,852 $169,359,927 $139,574,958 $ 384,311,764 $423,889,391
------------ ------------ ------------ ------------ ------------- ------------
Undistributed net
investment income
included in net assets
at end of period $ 1,566,992 $ 1,564,491 $ 517,325 $ 861,148 $ 1,525,875 $ 1,790,481
------------ ------------ ------------ ------------ ------------- ------------
Net gain (loss) as
computed for federal
tax purposes $ 7,595,651 $ 6,952,058 $ (3,273,439) $(25,282,206) $ 15,885,407 $ 39,461,216
------------ ------------ ------------ ------------ ------------- ------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds and The Wachovia Municipal Funds
Statements of Changes in Net Assets--Continued
<TABLE>
<CAPTION>
Wachovia Wachovia
Wachovia Intermediate Short-Term
Fixed Income Fund Fixed Income Fund Fixed Income Fund
-------------------------- --------------------------- --------------------------
Six-Months Six-Months Six-Months
Ended Year Ended Year Ended Year
(unaudited) Ended (unaudited) Ended (unaudited) Ended
May 31, November 30, May 31, November 30, May 31, November 30,
1999 1998 1999 1998 1999 1998
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Increase (Decrease) in
Net Assets:
Operations--
Net investment income $ 6,861,242 $ 12,119,208 $ 2,358,934 $ 5,108,991 $ 1,682,265 $ 5,662,695
Net realized gain on
investments 199,782 3,568,877 472,821 4,965,732 534,603 536,985
Net change in
unrealized
appreciation
(depreciation) of
investments, futures
contracts and
translation of assets
and liabilities in
foreign currency (9,546,147) 2,972,507 (3,826,351) (1,521,439) (1,249,838) 920,118
------------ ------------ ------------ ------------- ------------ ------------
Change in net assets
resulting from
operations (2,485,123) 18,660,592 (994,596) 8,553,284 967,030 7,119,798
------------ ------------ ------------ ------------- ------------ ------------
Distributions to
Shareholders--
Distributions from net
investment income
Class A Shares (1,142,954) (940,460) (109,779) (2,130,033) (296,287) (502,454)
Class B Shares (16,394) (16,381) -- -- -- --
Class Y Shares (5,655,839) (11,358,420) (2,230,858) (3,157,720) (1,821,023) (5,081,639)
Distributions from net
realized gain on
investments
Class A Shares (111,220) -- (92,052) -- -- --
Class B Shares (2,141) -- -- -- -- --
Class Y Shares (741,375) -- (1,701,080) -- -- --
------------ ------------ ------------ ------------- ------------ ------------
Change in net assets
from distributions to
shareholders (7,669,923) (12,315,261) (4,133,769) (5,287,753) (2,117,310) (5,584,093)
------------ ------------ ------------ ------------- ------------ ------------
Share Transactions--
Proceeds from sale of
shares 106,865,200 81,647,518 9,398,214 99,110,496 10,766,272 28,878,718
Net asset value of
shares issued to
shareholders in
payment of
distributions declared 4,837,544 7,498,622 409,710 592,995 1,930,016 5,384,024
Cost of shares redeemed (55,482,238) (53,025,914) (13,991,063) (107,004,830) (76,191,951) (25,225,385)
------------ ------------ ------------ ------------- ------------ ------------
Change in net assets
from share
transactions 56,220,506 36,120,226 (4,183,139) (7,301,339) (63,495,663) 9,037,357
------------ ------------ ------------ ------------- ------------ ------------
Change in net assets 46,065,460 42,465,557 (9,311,504) (4,035,808) (64,645,943) 10,573,062
Net Assets:
Beginning of period 238,043,019 195,577,462 92,589,817 96,625,625 108,869,482 98,296,420
------------ ------------ ------------ ------------- ------------ ------------
End of period $284,108,479 $238,043,019 $ 83,278,313 $ 92,589,817 $ 44,223,539 $108,869,482
------------ ------------ ------------ ------------- ------------ ------------
Undistributed net
investment
income/(distributions
in excess of net
investment income)
included in net assets
at end of period $ (18,396) -- $ 80,165 $ 61,868 $ 88,656 $ 523,701
------------ ------------ ------------ ------------- ------------ ------------
Net gain as computed
for federal tax
purposes $ 199,782 $ 3,793,537 $ 472,821 $ 4,972,877 $ 534,603 $ 531,738
------------ ------------ ------------ ------------- ------------ ------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds and The Wachovia Municipal Funds
Statements of Changes in Net Assets--Continued
<TABLE>
<CAPTION>
Wachovia Wachovia Wachovia
Georgia Muncipal North Carolina South Carolina
Bond Fund Municipal Bond Fund Municipal Bond Fund
------------------------- ------------------------- --------------------------
Six-Months Six-Months Six-Months
Ended Year Ended Year Ended Year
(unaudited) Ended (unaudited) Ended (unaudited) Ended
May 31, November 30, May 31, November 30, May 31, November 30,
1999 1998 1999 1998 1999 1998
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Increase
(Decrease) in Net
Assets:
Operations--
Net investment
income $ 489,472 $ 825,254 $ 1,356,803 $ 2,437,336 $ 2,831,824 $ 5,366,704
Net realized gain
on investments 59,361 61,857 32,152 327,825 72,688 209,185
Net change in
unrealized
appreciation
(depreciation)
of investments,
futures
contracts and
translation of
assets and
liabilities in
foreign currency (562,932) 428,018 (1,462,948) 1,360,515 (2,721,024) 2,123,645
----------- ----------- ----------- ----------- ------------ ------------
Change in net
assets
resulting from
operations (14,099) 1,315,129 (73,993) 4,125,676 183,488 7,699,534
----------- ----------- ----------- ----------- ------------ ------------
Distributions to
Shareholders--
Distributions
from net
investment
income
Class A Shares (124,453) (251,879) (176,504) (393,274) (1,490,253) (2,984,948)
Class B Shares -- -- -- -- -- --
Class Y Shares (366,733) (573,430) (1,179,855) (2,044,014) (1,344,264) (2,379,402)
Distributions
from net
realized gain on
investments
Class A Shares (17,546) (2,076) (48,350) (6,494) (117,285) (5,753)
Class B Shares -- -- -- -- -- --
Class Y Shares (44,251) (3,949) (287,849) (25,032) (94,242) (4,021)
----------- ----------- ----------- ----------- ------------ ------------
Change in net
assets from
distributions
to shareholders (552,983) (831,334) (1,692,558) (2,468,814) (3,046,044) (5,374,124)
----------- ----------- ----------- ----------- ------------ ------------
Share
Transactions--
Proceeds from
sale of shares 5,678,933 6,541,536 17,718,590 17,216,738 17,569,769 23,937,897
Net asset value
of shares issued
to shareholders
in payment of
distributions
declared 136,206 271,955 401,669 527,425 977,902 2,037,672
Cost of shares
redeemed (2,398,652) (2,205,784) (3,443,190) (8,774,593) (6,565,753) (14,650,172)
----------- ----------- ----------- ----------- ------------ ------------
Change in net
assets from
share
transactions 3,416,487 4,607,707 14,677,069 8,969,570 11,981,918 11,325,397
----------- ----------- ----------- ----------- ------------ ------------
Change in net
assets 2,849,405 5,091,502 12,910,518 10,626,432 9,119,362 13,650,807
Net Assets:
Beginning of
period 23,930,409 18,838,907 66,293,759 55,667,327 122,227,717 108,576,910
----------- ----------- ----------- ----------- ------------ ------------
End of period $26,779,814 $23,930,409 $79,204,277 $66,293,759 $131,347,079 $122,227,717
----------- ----------- ----------- ----------- ------------ ------------
Undistributed net
investment
income/(distributions
in excess of net
investment
income) included
in net assets
at end of period $ (1,217) $ 497 $ 492 $ 48 $ 315 $ 3,008
----------- ----------- ----------- ----------- ------------ ------------
Net gain as
computed for
federal tax
purposes $ 59,361 $ 61,164 $ 32,152 $ 327,826 $ 72,688 $ 207,167
----------- ----------- ----------- ----------- ------------ ------------
<CAPTION>
Wachovia
Virginia Municipal
Bond Fund
----------------------------
Six-Months
Ended Year
(unaudited) Ended
May 31, November 30,
1999 1998
- ----------------------------------------------------
<S> <C> <C>
Increase
(Decrease) in Net
Assets:
Operations--
Net investment
income $ 2,397,699 $ 4,906,389
Net realized gain
on investments 456,333 723,926
Net change in
unrealized
appreciation
(depreciation)
of investments,
futures
contracts and
translation of
assets and
liabilities in
foreign currency (2,472,485) 1,656,976
------------- --------------
Change in net
assets
resulting from
operations 381,547 7,287,291
------------- --------------
Distributions to
Shareholders--
Distributions
from net
investment
income
Class A Shares (187,772) (2,135,085)
Class B Shares -- --
Class Y Shares (2,209,938) (3,026,800)
Distributions
from net
realized gain on
investments
Class A Shares -- --
Class B Shares -- --
Class Y Shares -- --
------------- --------------
Change in net
assets from
distributions
to shareholders (2,397,710) (5,161,885)
------------- --------------
Share
Transactions--
Proceeds from
sale of shares 6,774,695 110,194,596
Net asset value
of shares issued
to shareholders
in payment of
distributions
declared 153,207 341,749
Cost of shares
redeemed (8,640,940) (115,832,370)
------------- --------------
Change in net
assets from
share
transactions (1,713,038) (5,296,025)
------------- --------------
Change in net
assets (3,729,201) (3,170,619)
Net Assets:
Beginning of
period 107,989,354 111,159,973
------------- --------------
End of period $104,260,153 $ 107,989,354
------------- --------------
Undistributed net
investment
income/(distributions
in excess of net
investment
income) included
in net assets
at end of period $ (7,268) $ --
------------- --------------
Net gain as
computed for
federal tax
purposes $ 456,333 $ 723,926
------------- --------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds and The Wachovia Municipal Funds
Financial Highlights--Class A Shares
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Net Realized Distributions
and Unrealized from Net
Gain/(Loss) on Realized
Investments, Gain on
Futures Investments,
Net Asset Contracts, and Distributions Futures
Value, Net Foreign Total from from Net Contracts and
Period Ended beginning Investment Currency Investment Investment Foreign Total
November 30, of period Income Transactions Operations Income Currency Distributions
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Wachovia Equity Fund
1994 $10.28 0.20 0.12 0.32 (0.20) (0.08) (0.28)
1995 $10.32 0.23 2.64 2.87 (0.25) (0.23) (0.48)
1996 $12.71 0.22(6) 2.83 3.05 (0.22) (0.73) (0.95)
1997 $14.81 0.14(6) 2.43 2.57 (0.13) (1.86) (1.99)
1998 $15.39 0.13(6) 2.21 2.34 (0.14) (1.68) (1.82)
1999(4) $15.91 0.04(6) 1.59 1.63 (0.05) (1.89) (1.94)
Wachovia Quantitative Equity Fund
1994(1) $10.00 0.12 (0.43) (0.31) (0.09) -- (0.09)
1995 $ 9.60 0.22 3.51 3.73 (0.22) -- (0.22)
1996 $13.11 0.24(6) 2.77 3.01 (0.21) (0.24) (0.45)
1997 $15.67 0.18(6) 4.14 4.32 (0.20) (0.79) (0.99)
1998 $19.00 0.11(6) 3.12 3.23 (0.19) (1.75) (1.94)
1999(4) $20.29 0.06 1.57 1.63 (0.07) (0.74) (0.81)
Wachovia Growth & Income Fund
1994 $10.20 0.17 (0.40) (0.23) (0.17) -- (0.17)
1995 $ 9.80 0.17 3.09 3.26 (0.18) -- (0.18)
1996 $12.88 0.15 3.67 3.82 (0.15) (0.14) (0.29)
1997 $16.41 0.13 4.44 4.57 (0.13) (0.25) (0.38)
1998 $20.60 0.11 3.94 4.05 (0.10) (1.01) (1.11)
1999(4) $23.54 0.04 2.03 2.07 (0.06) (2.89) (2.95)
Wachovia Equity Index Fund
1994 $10.47 0.25 (0.19) 0.06 (0.24) (0.02) (0.26)
1995 $10.27 0.28 3.37 3.65 (0.27) (0.03) (0.30)
1996 $13.62 0.32(6) 3.13 3.45 (0.31) (0.78) (1.09)
1997 $15.98 0.25(6) 3.85 4.10 (0.28) (0.91) (1.19)
1998 $18.89 0.26(6) 3.90 4.16 (0.24) (0.40) (0.64)
1999(4) $22.41 0.13(6) 2.55 2.68 (0.13) (0.37) (0.50)
Wachovia Special Values Fund
1994 $10.24 0.06 (0.22) (0.16) (0.05) (0.28) (0.33)
1995 $ 9.75 0.09 2.42 2.51 (0.02) (0.06) (0.08)
1996 $12.18 0.35 4.13 4.48 (0.08) (0.91) (0.99)
1997 $15.67 0.13(6) 4.53 4.66 (0.08) (1.61) (1.69)
1998 $18.64 0.19(6) (0.87) (0.68) (0.12) (1.71) (1.83)
1999(4) $16.13 0.16 0.86 1.02 (0.16) (0.75) (0.91)
Wachovia Emerging Markets Fund
1995(7) $10.00 0.05 0.36 0.41 -- -- --
1996 $10.41 0.09(6) 1.20 1.29 (0.03) -- (0.03)
1997 $11.67 0.03(6) (0.47) (0.44) (0.11) -- (0.11)
1998 $11.12 0.09(6) (2.68) (2.59) (0.10) -- (0.10)
1999(4) $ 8.43 0.04(6) 1.63 1.67 (0.05) -- (0.05)
Wachovia Balanced Fund
1994 $10.33 0.35 (0.38) (0.03) (0.33) (0.04) (0.37)
1995 $ 9.93 0.40 2.13 2.53 (0.38) (0.16) (0.54)
1996 $11.92 0.38(6) 1.72 2.10 (0.38) (0.34) (0.72)
1997 $13.30 0.34(6) 1.40 1.74 (0.34) (1.44) (1.78)
1998 $13.26 0.24(6) 1.50 1.74 (0.38) (0.90) (1.28)
1999(4) $13.72 0.16(6) 0.61 0.77 (0.16) (1.26) (1.42)
</TABLE>
(1) Reflects operations for the period from March 28, 1994 (date of initial
public investment) to November 30, 1994.
(2) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(3) As a result of contractual obligations, certain fees were waived or
reimbursed. If such waivers or reimbursements had not occurred, the ratios
would have been as indicated.
(4) For six-months ended May 31, 1999 (unaudited). (5) Computed on an annualized
basis. (6) Per share information is based on average shares outstanding.
(7) Reflects operations for the period from December 26, 1994 (date of initial
public investment) to November 30, 1995.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds and The Wachovia Municipal Funds
Financial Highlights--Class A Shares--Continued
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Ratios to Average Net Assets
---------------------------------------------------------
Net Investment
Net Asset Net Expense Income Net Assets, end Portfolio Period
Ended Value, end Total Investment (after waivers/ (after waivers/ of period (000
Turnover November 30, of period Return(2) Expenses(3) Income(3) reimbursements)
reimbursements) omitted) Rate
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Wachovia Equity Fund
1994 $10.32 3.10% 1.03% 1.82% 0.87% 1.98% $ 87,022 35%
1995 $12.71 28.74% 0.97% 1.92% 0.90% 1.99% $130,150 65%
1996 $14.81 25.56% 1.05% 1.47% 0.90% 1.62% $ 20,774 64%
1997 $15.39 20.22% 1.21% 0.88% 1.14% 0.95% $ 39,494 124%
1998 $15.91 17.34% 1.12% 0.91% 1.12% 0.91% $ 53,103 150%
1999(4) $15.60 11.12% 1.10%(5) 0.50%(5) 1.10%(5) 0.50%(5) $107,767 39%
Wachovia Quantitative Equity Fund
1994(1) $ 9.60 (3.08%) 1.00%(5) 1.73%(5) 0.90%(5) 1.83%(5) $ 91,979 64%
1995 $13.11 39.33% 0.97% 1.83% 0.87% 1.93% $121,895 63%
1996 $15.67 23.74% 1.02% 1.55% 0.87% 1.70% $ 15,742 44%
1997 $19.00 29.38% 1.18% 1.02% 1.11% 1.09% $ 35,413 74%
1998 $20.29 18.98% 1.11% 0.95% 1.11% 0.95% $ 82,682 38%
1999(4) $21.11 8.22% 1.11%(5) 0.61%(5) 1.11%(5) 0.61%(5) $ 85,941 26%
Wachovia Growth & Income Fund
1994 $ 9.80 (2.26%) 1.75% 1.35% 1.35% 1.75% $103,140 30%
1995 $12.88 33.59% 1.71% 1.22% 1.35% 1.58% $119,484 30%
1996 $16.41 30.10% 1.66% 0.73% 1.35% 1.04% $186,147 12%
1997 $20.60 28.50% 1.60% 0.40% 1.30% 0.70% $338,724 13%
1998 $23.54 20.77% 1.29% 0.51% 1.21% 0.59% $130,306 24%
1999(4) $22.66 9.63% 1.11%(5) 0.31%(5) 1.11%(5) 0.31%(5) $139,009 14%
Wachovia Equity Index Fund
1994 $10.27 0.56% 0.54% 2.36% 0.46% 2.44% $183,852 9%
1995 $13.62 36.15% 0.53% 2.34% 0.48% 2.39% $186,841 60%
1996 $15.98 27.19% 0.61% 2.10% 0.48% 2.23% $ 18,154 12%
1997 $18.89 27.55% 0.74% 1.44% 0.72% 1.46% $ 50,917 4%
1998 $22.41 22.74% 0.70% 1.23% 0.70% 1.23% $131,594 29%
1999(4) $24.59 12.12% 0.68%(5) 1.09%(5) 0.68%(5) 1.09%(5) $166,027 3%
Wachovia Special Values Fund
1994 $ 9.75 (1.61%) 2.22% (0.46%) 1.13% 0.63% $ 17,431 62%
1995 $12.18 25.91% 1.87% 0.22% 1.29% 0.80% $ 24,093 57%
1996 $15.67 39.78% 1.50% 0.18% 1.21% 0.47% $ 6,642 38%
1997 $18.64 33.08% 1.36% 0.73% 1.35% 0.74% $ 37,766 46%
1998 $16.13 (3.86%) 1.25% 0.98% 1.25% 0.98% $ 59,408 20%
1999(4) $16.24 6.79% 1.22%(5) 2.12%(5) 1.22%(5) 2.12%(5) $ 68,762 18%
Wachovia Emerging Markets Fund
1995(7) $10.41 4.10% 2.08%(5) 0.57%(5) 1.80%(5) 0.85%(5) $ 71,276 17%
1996 $11.67 12.45% 1.78% 0.64% 1.69% 0.73% $ 5,488 30%
1997 $11.12 (3.82%) 1.79% 0.26% 1.79% 0.26% $ 7,996 60%
1998 $ 8.43 (23.46%) 1.68% 0.90% 1.68% 0.90% $ 8,677 51%
1999(4) $10.05 19.90% 1.69%(5) 0.82%(5) 1.69%(5) 0.82%(5) $ 14,485 31%
Wachovia Balanced Fund
1994 $ 9.93 (0.39%) 0.92% 3.29% 0.75% 3.46% $194,430 74%
1995 $11.92 26.32% 0.92% 3.42% 0.76% 3.58% $207,421 102%
1996 $13.30 18.55% 1.00% 2.81% 0.76% 3.05% $ 18,619 99%
1997 $13.26 15.17% 1.18% 2.61% 1.02% 2.77% $ 50,968 143%
1998 $13.72 14.36% 1.10% 2.79% 1.01% 2.88% $119,093 124%
1999(4) $13.07 5.98% 1.08%(5) 2.23%(5) 1.01%(5) 2.30%(5) $194,237 38%
</TABLE>
(1) Reflects operations for the period from March 28, 1994 (date of initial
public investment) to November 30, 1994.
(2) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(3) As a result of contractual obligations, certain fees were waived or
reimbursed. If such waivers or reimbursements had not occurred, the ratios
would have been as indicated.
(4) For six-months ended May 31, 1999 (unaudited). (5) Computed on an annualized
basis. (6) Per share information is based on average shares outstanding.
(7) Reflects operations for the period from December 26, 1994 (date of initial
public investment) to November 30, 1995.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds and The Wachovia Municipal Funds
Financial Highlights--Class A Shares--Continued
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Net Realized Distributions
and Unrealized from Net
Gain/(Loss) on Realized
Investments, Gain on
Futures Investments,
Net Asset Contracts, and Distributions Futures
Value, Net Foreign Total from from Net Contracts and
Period Ended beginning Investment Currency Investment Investment Foreign Total
November 30, of period Income Transactions Operations Income Currency Distributions
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Wachovia Fixed Income Fund
1994 $10.00 0.56 (0.98) (0.42) (0.55) (0.06) (0.61)
1995 $ 8.97 0.58 0.92 1.50 (0.57) -- (0.57)
1996 $ 9.90 0.61(5) (0.09) 0.52 (0.59) -- (0.59)
1997 $ 9.83 0.54(5) 0.04 0.58 (0.56) -- (0.56)
1998 $ 9.85 0.53(5) 0.30 0.83 (0.54) -- (0.54)
1999(3) $10.14 0.25 (0.35) (0.10) (0.25) (0.04) (0.29)
Wachovia Intermediate Fixed Income Fund
1994 $10.20 0.44 (0.79) (0.35) (0.43) -- (0.54)
1995 $ 9.31 0.55 0.76 1.31 (0.54) -- (0.55)
1996 $10.07 0.55 (0.11) 0.44 (0.55) -- (0.55)
1997 $ 9.96 0.54 0.06 0.60 (0.53) -- (0.53)
1998 $10.03 0.47 0.40 0.87 (0.52) -- (0.52)
1999(3) $10.38 0.25 (0.38) (0.13) (0.25) (0.20) (0.45)
Wachovia Short-Term Fixed Income Fund
1994 $ 9.91 0.45 (0.33) 0.12 (0.45) -- (0.45)
1995 $ 9.58 0.59 0.24 0.83 (0.52) -- (0.52)
1996 $ 9.89 0.56(5) (0.06) 0.50 (0.60) -- (0.60)
1997 $ 9.79 0.50(5) (0.01) 0.49 (0.51) -- (0.51)
1998 $ 9.77 0.52(5) 0.14 0.66 (0.51) -- (0.51)
1999(3) $ 9.92 0.20 (0.13) 0.07 (0.28) -- (0.28)
Wachovia Georgia Municipal Bond Fund
1995(6) $10.00 0.41 0.96 1.37 (0.41) -- (0.41)
1996 $10.96 0.47 0.05 0.52 (0.47) (0.01) (0.48)
1997 $11.00 0.44 0.13 0.57 (0.44) (0.02) (0.46)
1998 $11.11 0.42 0.27 0.69 (0.42) (0.00)(7) (0.42)
1999(3) $11.38 0.21 (0.22) (0.01) (0.21) (0.03) (0.24)
Wachovia North Carolina Municipal Bond Fund
1995(6) $10.00 0.43 0.99 1.42 (0.43) -- (0.43)
1996 $10.99 0.45 0.09 0.54 (0.45) (0.05) (0.50)
1997 $11.03 0.43 0.14 0.57 (0.43) (0.02) (0.45)
1998 $11.15 0.43 0.32 0.75 (0.43) (0.01) (0.44)
1999(3) $11.46 0.21 (0.22) (0.01) (0.21) (0.06) (0.27)
Wachovia South Carolina Municipal Bond Fund
1994 $11.12 0.56 (1.04) (0.48) (0.56) (0.03) (0.59)
1995 $10.05 0.56 1.10 1.66 (0.56) (0.10) (0.66)
1996 $11.05 0.55 0.03 0.58 (0.55) (0.03) (0.58)
1997 $11.05 0.53 0.11 0.64 (0.52) (0.05) (0.57)
1998 $11.12 0.51 0.24 0.75 (0.51) (0.00)(7) (0.51)
1999(3) $11.36 0.25 (0.24) 0.01 (0.25) (0.02) (0.27)
Wachovia Virginia Municipal Bond Fund
1994 $10.31 0.38 (0.90) (0.52) (0.39) -- (0.39)
1995 $ 9.40 0.42 0.85 1.27 (0.42) -- (0.42)
1996 $10.25 0.44 (0.10) 0.34 (0.44) -- (0.44)
1997 $10.15 0.46 0.13 0.59 (0.45) -- (0.45)
1998 $10.29 0.48 0.14 0.62 (0.48) -- (0.42)
1999(3) $10.49 0.22 (0.19) 0.03 (0.22) -- (0.22)
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(2) As a result of contractual obligations, certain fees were waived or
reimbursed. If such waivers or reimbursements had not occurred, the ratios
would have been as indicated.
(3) For six-months ended May 31, 1999 (unaudited). (4) Computed on an annualized
basis. (5) Per share information is based on average shares outstanding.
(6) Reflects operations for the period from December 26, 1994 (date of initial
public investment) to November 30, 1995.
(7) Less than $0.01 per share.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds and The Wachovia Municipal Funds
Financial Highlights--Class A Shares--Continued
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Ratios to Average Net Assets
--------------------------------------------------------
Net Investment
Net Asset Net Expense Income Net Assets, end Portfolio Period
Ended Value, end Total Investment (after waivers/ (after waivers/ of period (000
Turnover November 30, of period Return(1) Expenses(2) Income(2) reimbursements)
reimbursements) omitted) Rate
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Wachovia Fixed Income Fund
1994 $ 8.97 (4.30%) 0.84% 5.77% 0.71% 5.90% $148,751 148%
1995 $ 9.90 17.20% 0.84% 5.97% 0.74% 6.07% $169,846 155%
1996 $ 9.83 5.51% 0.92% 5.87% 0.74% 6.05% $ 4,853 181%
1997 $ 9.85 6.14% 1.09% 5.54% 0.98% 5.65% $ 10,039 174%
1998 $10.14 8.65% 1.02% 5.25% 0.97% 5.30% $ 24,624 111%
1999(3) $ 9.75 (1.02%) 1.00%(4) 5.09%(4) 0.97%(4) 5.11%(4) $ 66,761 35%
Wachovia Intermediate Fixed Income Fund
1994 $ 9.31 (3.51%) 1.49% 4.06% 1.09% 4.46% $ 48,730 55%
1995 $10.07 14.44% 1.51% 5.19% 1.10% 5.60% $ 35,796 44%
1996 $ 9.96 4.46% 1.40% 5.31% 1.09% 5.62% $ 43,277 84%
1997 $10.03 6.32% 1.34% 5.20% 1.04% 5.50% $ 96,626 81%
1998 $10.38 9.39% 1.20% 5.25% 1.06% 5.39% $ 4,759 57%
1999(3) $ 9.80 (1.28%) 1.04%(4) 5.00%(4) 0.99%(4) 5.05%(4) $ 3,998 60%
Wachovia Short-Term Fixed Income Fund
1994 $ 9.58 1.27% 0.78% 4.44% 0.60% 4.62% $148,326 151%
1995 $ 9.89 8.82% 0.81% 5.65% 0.63% 5.83% $124,720 147%
1996 $ 9.79 5.29% 0.90% 5.23% 0.63% 5.50% $ 1,675 145%
1997 $ 9.77 5.10% 1.06% 5.30% 0.87% 5.49% $ 7,233 215%
1998 $ 9.92 6.93% 0.98% 5.12% 0.88% 5.22% $ 10,437 135%
1999(3) $ 9.71 0.75% 1.02%(4) 4.78%(4) 0.88%(4) 4.92%(4) $ 10,140 14%
Wachovia Georgia Municipal Bond Fund
1995(6) $10.96 13.93% 2.80%(4) 2.43%(4) 0.92%(4) 4.30%(4) $ 10,220 14%
1996 $11.00 4.97% 2.50% 2.79% 0.89% 4.40% $ 7,531 14%
1997 $11.11 5.41% 2.25% 2.92% 1.14% 4.03% $ 6,531 25%
1998 $11.38 6.35% 1.51% 3.38% 1.17% 3.72% $ 6,900 14%
1999(3) $11.13 (0.15%) 1.42%(4) 3.37%(4) 1.16%(4) 3.63%(4) $ 6,668 10%
Wachovia North Carolina Municipal Bond Fund
1995(6) $10.99 14.40% 2.04%(4) 3.21%(4) 0.85%(4) 4.40%(4) $ 18,679 19%
1996 $11.03 5.17% 1.61% 3.47% 0.84% 4.24% $ 13,752 7%
1997 $11.15 5.36% 1.51% 3.47% 1.07% 3.91% $ 11,563 17%
1998 $11.46 6.82% 1.26% 3.64% 1.10% 3.80% $ 9,533 9%
1999(3) $11.18 (0.14%) 1.25%(4) 3.50%(4) 1.10%(4) 3.65%(4) $ 9,698 4%
Wachovia South Carolina Municipal Bond Fund
1994 $10.05 (4.52%) 1.19% 4.63% 0.60% 5.22% $ 75,995 23%
1995 $11.05 16.97% 1.13% 4.68% 0.58% 5.23% $ 93,725 15%
1996 $11.05 5.54% 1.16% 4.51% 0.57% 5.10% $ 65,981 20%
1997 $11.12 6.01% 1.29% 4.31% 0.81% 4.79% $ 64,696 12%
1998 $11.36 6.88% 1.19% 4.16% 0.83% 4.52% $ 67,458 6%
1999(3) $11.10 0.06% 1.18%(4) 4.07%(4) 0.83%(4) 4.42%(4) $ 66,460 5%
Wachovia Virginia Municipal Bond Fund
1994 $ 9.40 (5.17%) 1.56% 3.38% 1.04% 3.90% $ 39,978 87%
1995 $10.25 13.79% 1.51% 3.87% 1.05% 4.33% $ 54,041 78%
1996 $10.15 3.50% 1.44% 4.05% 1.04% 4.45% $ 70,378 37%
1997 $10.30 5.97% 1.36% 4.10% 0.96% 4.50% $111,160 15%
1998 $10.49 6.76% 1.28% 4.02% 0.95% 4.35% $ 8,835 15%
1999(3) $10.30 0.31% 1.19%(4) 4.03%(4) 0.93%(4) 4.28%(4) $ 8,560 12%
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(2) As a result of contractual obligations, certain fees were waived or
reimbursed. If such waivers or reimbursements had not occurred, the ratios
would have been as indicated.
(3) For six-months ended May 31, 1999 (unaudited). (4) Computed on an annualized
basis. (5) Per share information is based on average shares outstanding.
(6) Reflects operations for the period from December 26, 1994 (date of initial
public investment) to November 30, 1995.
(7) Less than $0.01 per share.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds and The Wachovia Municipal Funds
Financial Highlights--Class B Shares
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Net Realized and
Unrealized Gain/ Distributions from
(Loss) on Net Realized Gain
Net Asset Investments, Distributions on Investments,
Value, Net Investment Futures Contracts and Total From from Net Futures Contracts
Period Ended beginning Income/ Foreign Currency Investment Investment and Foreign Total
November 30, of period (Operating Loss) Transactions Operations Income Currency Distributions
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Wachovia Equity Fund
1996(1) $12.43 0.02 2.37 2.39 (0.03) -- (0.03)
1997 $14.79 0.04 2.42 2.46 (0.04) (1.86) (1.90)
1998 $15.35 0.03 2.20 2.23 (0.03) (1.68) (1.71)
1999(4) $15.87 (0.02) 1.59 1.57 (0.00)(6) (1.89) (1.89)
Wachovia Quantitative Equity Fund
1996(1) $13.09 0.04 2.56 2.60 (0.04) -- (0.04)
1997 $15.65 0.08 4.10 4.18 (0.09) (0.79) (0.88)
1998 $18.95 0.05 3.04 3.09 (0.06) (1.75) (1.81)
1999(4) $20.23 (0.01) 1.58 1.57 (0.00)(6) (0.74) (0.74)
Wachovia Special Values Fund
1999(7) $14.60 0.17 1.49 1.66 -- -- --
Wachovia Balanced Fund
1996(1) $11.68 0.09 1.59 1.68 (0.07) -- (0.07)
1997 $13.29 0.26 1.38 1.64 (0.26) (1.44) (1.70)
1998 $13.23 0.28 1.37 1.65 (0.29) (0.90) (1.19)
1999(4) $13.69 0.10 0.61 0.71 (0.11) (1.26) (1.37)
Wachovia Fixed Income Fund
1996(1) $ 9.45 0.15 0.40 0.55 (0.17) -- (0.17)
1997 $ 9.83 0.48 0.01 0.49 (0.48) -- (0.48)
1998 $ 9.84 0.47 0.30 0.77 (0.47) -- (0.47)
1999(4) $10.14 0.22 (0.35) (0.13) (0.22) (0.04) (0.26)
</TABLE>
(1) Reflects operations for the period from July 22, 1996 (date of initial
public investment) to November 30, 1996.
(2) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(3) As a result of contractual obligations, certain fees were waived or
reimbursed. If such waivers or reimbursements had not occurred, the ratios
would have been as indicated.
(4) For six-months ended May 31, 1999 (unaudited). (5) Computed on an annualized
basis.
(6) Less than $0.01 per share.
(7) Reflects operations for the period from March 26, 1999 (date of initial
public investment) to May 31, 1999.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds and The Wachovia Municipal Funds
Financial Highlights--Class B Shares--Continued
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Ratios to Average Net Assets
---------------------------------------------------------
Net Investment
Net Expense Income Net Assets, Portfolio
Period Ended Net Asset Value, Total Investment (after waivers/ (after waivers/
end of period Turnover November 30, end of period Return(2) Expenses(3)
Income(3) reimbursements) reimbursements) (000 omitted) Rate
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Wachovia Equity Fund
1996(1) $14.79 19.25% 2.10%(5) (0.18%)(5) 1.90%(5) 0.02%(5) $ 976 64%
1997 $15.35 19.27% 1.96% 0.12% 1.90% 0.18% $ 3,448 124%
1998 $15.87 16.52% 1.87% 0.17% 1.87% 0.17% $ 5,725 150%
1999(4) $15.55 10.76% 1.85%(5) (0.25%)(5) 1.85%(5) (0.25%)(5) $ 7,101 39%
Wachovia Quantitative Equity Fund
1996(1) $15.65 19.90% 1.98%(5) 0.35%(5) 1.87%(5) 0.46%(5) $ 1,414 44%
1997 $18.95 28.33% 1.92% 0.24% 1.85% 0.31% $ 6,564 74%
1998 $20.23 18.15% 1.86% 0.20% 1.86% 0.20% $19,532 38%
1999(4) $21.06 7.94% 1.86%(5) (0.14%)(5) 1.86%(5) (0.14%)(5) $22,844 26%
Wachovia Special Values Fund
1999(7) $16.26 11.37% 1.97%(5) 1.37%(5) 1.97%(5) 1.37%(5) $ 114 18%
Wachovia Balanced Fund
1996(1) $13.29 14.47% 1.92%(5) 1.77%(5) 1.76%(5) 1.93%(5) $ 1,821 99%
1997 $13.23 14.19% 1.94% 1.85% 1.78% 2.01% $ 5,916 143%
1998 $13.69 13.56% 1.85% 2.04% 1.76% 2.13% $13,963 124%
1999(4) $13.03 5.54% 1.83%(5) 1.48%(5) 1.76%(5) 1.55%(5) $18,036 38%
Wachovia Fixed Income Fund
1996(1) $ 9.83 5.83% 1.87%(5) 5.07%(5) 1.74%(5) 5.20%(5) $ 113 181%
1997 $ 9.84 5.21% 1.86% 4.78% 1.75% 4.89% $ 140 174%
1998 $10.14 7.97% 1.77% 4.50% 1.72% 4.55% $ 533 111%
1999(4) $ 9.75 (1.38%) 1.75%(5) 4.34%(5) 1.72%(5) 4.36%(5) $ 842 35%
</TABLE>
(1) Reflects operations for the period from July 22, 1996 (date of initial
public investment) to November 30, 1996.
(2) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(3) As a result of contractual obligations, certain fees were waived or
reimbursed. If such waivers or reimbursements had not occurred, the ratios
would have been as indicated.
(4) For six-months ended May 31, 1999 (unaudited). (5) Computed on an annualized
basis.
(6) Less than $0.01 per share.
(7) Reflects operations for the period from March 26, 1999 (date of initial
public investment) to May 31, 1999.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds and The Wachovia Municipal Funds
Financial Highlights--Class Y Shares
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Net Realized and
Unrealized Gain/
(Loss) on Distributions from
Investments, Net Realized Gain
Net Asset Futures Distributions on Investments,
Value, Net Contracts, and Total From from Net Futures Contracts
Period Ended beginning Investment Foreign Currency Investment Investment and Foreign Total
November 30, of period Income Transactions Operations Income Currency Distributions
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Wachovia Equity Fund
1996(1) $12.43 0.03 2.40 2.43 (0.05) -- (0.05)
1997 $14.81 0.17 2.43 2.60 (0.16) (1.86) (2.02)
1998 $15.39 0.17 2.21 2.38 (0.17) (1.68) (1.85)
1999(4) $15.92 0.06(6) 1.58 1.64 (0.06) (1.89) (1.95)
Wachovia Quantitative Equity Fund
1996(1) $13.09 0.04 2.60 2.64 (0.06) -- (0.06)
1997 $15.67 0.23 4.12 4.35 (0.23) (0.79) (1.02)
1998 $19.00 0.23 3.06 3.29 (0.23) (1.75) (1.98)
1999(4) $20.31 0.10 1.58 1.68 (0.10) (0.74) (0.84)
Wachovia Growth & Income Fund
1998(7) $22.31 0.09 1.24 1.33 (0.09) -- (0.09)
1999(4) $23.55 0.06 2.03 2.09 (0.08) (2.89) (2.97)
Wachovia Equity Index Fund
1996(1) $13.37 0.09(6) 2.60 2.69 (0.08) -- (0.08)
1997 $15.98 0.29 3.86 4.15 (0.31) (0.91) (1.22)
1998 $18.91 0.30 3.92 4.22 (0.29) (0.40) (0.69)
1999(4) $22.44 0.17 2.55 2.72 (0.16) (0.37) (0.53)
Wachovia Special Values Fund
1996(1) $13.62 0.03 2.02 2.05 -- -- --
1997 $15.67 0.16 4.53 4.69 (0.08) (1.61) (1.69)
1998 $18.67 0.21 (0.84) (0.63) (0.15) (1.71) (1.86)
1999(4) $16.18 0.17 0.86 1.03 (0.20) (0.75) (0.95)
Wachovia Emerging Markets Fund
1996(1) $11.92 0.01(6) (0.26) (0.25) -- -- --
1997 $11.67 0.07 (0.50) (0.43) (0.11) -- (0.11)
1998 $11.13 0.13 (2.69) (2.56) (0.13) -- (0.13)
1999(4) $ 8.44 0.05(6) 1.63 1.68 (0.07) -- (0.07)
Wachovia Balanced Fund
1996(1) $11.68 0.08 1.63 1.71 (0.09) -- (0.09)
1997 $13.30 0.38 1.39 1.77 (0.37) (1.44) (1.81)
1998 $13.26 0.42 1.37 1.79 (0.41) (0.90) (1.31)
1999(4) $13.74 0.16 0.63 0.79 (0.18) (1.26) (1.44)
Wachovia Fixed Income Fund
1996(1) $ 9.45 0.17 0.40 0.57 (0.19) -- (0.19)
1997 $ 9.83 0.57 0.03 0.60 (0.58) -- (0.58)
1998 $ 9.85 0.56 0.29 0.85 (0.56) -- (0.56)
1999(4) $10.14 0.27 (0.35) (0.08) (0.27) (0.04) (0.31)
Wachovia Intermediate Fixed Income Fund
1998(7) $10.12 0.42 0.25 0.67 (0.41) -- (0.41)
1998(4) $10.38 0.27 (0.38) (0.11) (0.27) (0.20) (0.47)
Wachovia Short-Term Fixed Income Fund
1996(1) $ 9.67 0.11(6) 0.18 0.29 (0.17) -- (0.17)
1997 $ 9.79 0.56 (0.05) 0.51 (0.53) -- (0.53)
1998 $ 9.77 0.54 0.14 0.68 (0.53) -- (0.53)
1999(4) $ 9.92 0.22 (0.13) 0.09 (0.30) -- (0.30)
</TABLE>
(1) Reflects operations for the period from July 22, 1996 (date of initial
public investment) to November 30, 1996.
(2) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(3) As a result of contractual obligations, certain fees were waived or
reimbursed. If such waivers or reimbursements had not occurred, the ratios
would have been as indicated.
(4) For six-months ended May 31, 1999 (unaudited). (5) Computed on an annualized
basis. (6) Per share information is based on average shares outstanding.
(7) Reflects operations for the period from March 29, 1998 (date of initial
public offering) to November 30, 1998.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds and The Wachovia Municipal Funds
Financial Highlights--Class Y Shares--Continued
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Ratios to Average Net Assets
--------------------------------------------------------
Net Investment
Net Expense Income Net Assets, Portfolio
Period Ended Net Asset Value, Total Investment (after waivers/ (after waivers/
end of period Turnover November 30, end of period Return(2) Expenses(3)
Income(3) reimbursements) reimbursements) (000 omitted) Rate
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Wachovia Equity Fund
1996(1) $14.81 19.57% 1.09%(5) 0.72%(5) 0.90%(5) 0.91%(5) $129,205 64%
1997 $15.39 20.44% 0.97% 1.11% 0.90% 1.18% $156,238 124%
1998 $15.92 17.69% 0.90% 1.13% 0.90% 1.13% $200,324 150%
1999(4) $15.61 11.26% 0.85%(5) 0.75%(5) 0.85%(5) 0.75%(5) $188,854 39%
Wachovia Quantitative Equity Fund
1996(1) $15.67 20.19% 0.98%(5) 1.08%(5) 0.87%(5) 1.19%(5) $152,571 44%
1997 $19.00 29.60% 0.95% 1.27% 0.87% 1.35% $183,019 74%
1998 $20.31 19.38% 0.87% 1.21% 0.87% 1.21% $207,343 38%
1999(4) $21.15 8.45% 0.86%(5) 0.86%(5) 0.86%(5) 0.86%(5) $224,982 26%
Wachovia Growth & Income Fund
1998(7) $23.55 6.03% 0.94%(5) 0.82%(5) 0.86%(5) 0.90%(5) $206,176 24%
1999(4) $22.67 9.76% 0.86%(5) 0.56%(5) 0.86%(5) 0.56%(5) $190,079 14%
Wachovia Equity Index Fund
1996(1) $15.98 20.14% 0.54%(5) 1.86%(5) 0.48%(5) 1.92%(5) $213,833 12%
1997 $18.91 27.91% 0.49% 1.70% 0.47% 1.72% $248,030 4%
1998 $22.44 23.05% 0.45% 1.46% 0.45% 1.46% $291,708 29%
1999(4) $24.63 12.28% 0.43%(5) 1.34%(5) 0.43%(5) 1.34%(5) $340,475 3%
Wachovia Special Values Fund
1996(1) $15.67 15.05% 1.39%(5) 1.52%(5) 1.15%(5) 1.76%(5) $ 58,697 38%
1997 $18.67 33.29% 1.13% 0.86% 1.11% 0.88% $ 84,501 46%
1998 $16.18 (3.59%) 1.00% 1.26% 1.00% 1.26% $ 90,550 20%
1999(4) $16.26 6.86% 0.97%(5) 2.37%(5) 0.97%(5) 2.37%(5) $100,205 18%
Wachovia Emerging Markets Fund
1996(1) $11.67 0.00% 0.76%(5) 0.32%(5) 0.63%(5) 0.45%(5) $123,036 30%
1997 $11.13 (3.73%) 1.54% 0.54% 1.54% 0.54% $139,700 60%
1998 $ 8.44 (23.34%) 1.44% 1.04% 1.44% 1.04% $130,898 51%
1999(4) $10.05 20.08% 1.44%(5) 1.07%(5) 1.44%(5) 1.07%(5) $154,875 31%
Wachovia Balanced Fund
1996(1) $13.30 14.69% 0.92%(5) 2.69%(5) 0.76%(5) 2.85%(5) $235,791 99%
1997 $13.26 15.37% 0.93% 2.86% 0.77% 3.02% $250,083 143%
1998 $13.74 14.77% 0.85% 3.06% 0.76% 3.15% $290,833 124%
1999(4) $13.09 6.10% 0.83%(5) 2.48%(5) 0.76%(5) 2.55%(5) $172,039 38%
Wachovia Fixed Income Fund
1996(1) $ 9.83 6.12% 0.89%(5) 6.19%(5) 0.75%(5) 6.33%(5) $175,836 181%
1997 $ 9.85 6.38% 0.85% 5.80% 0.74% 5.91% $185,398 174%
1998 $10.14 8.92% 0.77% 5.50% 0.72% 5.55% $212,886 111%
1999(4) $ 9.75 (0.90%) 0.75%(5) 5.34%(5) 0.72%(5) 5.36%(5) $216,505 35%
Wachovia Intermediate Fixed Income Fund
1998(7) $10.38 7.11% 0.88%(5) 5.25%(5) 0.74%(5) 5.39%(5) $ 87,831 57%
1999(4) $ 9.80 (1.14%) 0.79%(5) 5.25%(5) 0.74%(5) 5.30%(5) $ 79,280 60%
Wachovia Short-Term Fixed Income Fund
1996(1) $ 9.79 3.00% 0.83%(5) 5.58%(5) 0.64%(5) 5.77%(5) $116,138 145%
1997 $ 9.77 5.33% 0.83% 5.43% 0.63% 5.63% $ 91,063 215%
1998 $ 9.92 7.19% 0.73% 5.37% 0.63% 5.47% $ 98,433 135%
1999(4) $ 9.71 0.88% 0.77%(5) 5.03%(5) 0.63%(5) 5.17%(5) $ 34,083 14%
</TABLE>
(1) Reflects operations for the period from July 22, 1996 (date of initial
public investment) to November 30, 1996.
(2) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(3) As a result of contractual obligations, certain fees were waived or
reimbursed. If such waivers or reimbursements had not occurred, the ratios
would have been as indicated.
(4) For six-months ended May 31, 1999 (unaudited). (5) Computed on an annualized
basis. (6) Per share information is based on average shares outstanding.
(7) Reflects operations for the period from March 29, 1998 (date of initial
public investment) to November 30, 1998.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds and The Wachovia Municipal Funds
Financial Highlights--Class Y Shares--Continued
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Net Realized and
Unrealized Gain/
(Loss) on Distributions from
Investments, Net Realized Gain
Net Asset Futures Distributions on Investments,
Value, Net Contracts, and Total From from Net Futures Contracts
Period Ended beginning Investment Foreign Currency Investment Investment and Foreign Total
November 30, of period Income Transactions Operations Income Currency Distributions
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Wachovia Georgia Municipal Bond Fund
1996(1) $10.71 0.17 0.29 0.46 (0.17) -- (0.17)
1997 $11.00 0.47 0.13 0.60 (0.47) (0.02) (0.49)
1998 $11.11 0.45 0.27 0.72 (0.45) (0.00)(7) (0.45)
1999(4) $11.38 0.22 (0.22) 0.00 (0.22) (0.03) (0.25)
Wachovia North Carolina Municipal Bond Fund
1996(1) $10.71 0.16 0.32 0.48 (0.16) -- (0.16)
1997 $11.03 0.46 0.13 0.59 (0.45) (0.02) (0.47)
1998 $11.15 0.46 0.32 0.78 (0.46) (0.01) (0.47)
1999(4) $11.46 0.22 (0.22) 0.00 (0.22) (0.06) (0.28)
Wachovia South Carolina Municipal Bond Fund
1996(1) $10.73 0.20 0.32 0.52 (0.20) -- (0.20)
1997 $11.05 0.55 0.12 0.67 (0.55) (0.05) (0.60)
1998 $11.12 0.54 0.24 0.78 (0.54) (0.00)(7) (0.54)
1999(4) $11.36 0.26 (0.24) 0.02 (0.26) (0.02) (0.28)
Wachovia Virginia Municipal Bond Fund
1998(6) $10.34 0.32 0.15 0.47 (0.32) -- (0.32)
1999(4) $10.49 0.24 (0.19) 0.05 (0.24) -- (0.24)
</TABLE>
(1) Reflects operations for the period from July 22, 1996 (date of initial
public investment) to November 30, 1996.
(2) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(3) As a result of contractual obligations, certain fees were waived or
reimbursed. If such waivers or reimbursements had not occurred, the ratios
would have been as indicated.
(4) For six-months ended May 31, 1999 (unaudited). (5) Computed on an annualized
basis.
(6) Reflects operations for the period from March 29, 1998 (date of initial
public offering) to November 30, 1998.
(7) Less than $0.01 per share.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds and The Wachovia Municipal Funds
Financial Highlights--Class Y Shares--Continued
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Ratios to Average Net Assets
--------------------------------------------------------
Net Investment
Net Expense Income Net Assets, Portfolio
Period Ended Net Asset Value, Total Investment (after waivers/ (after waivers/
end of period Turnover November 30, end of period Return(2) Expenses(3)
Income(3) reimbursements) reimbursements) (000 omitted) Rate
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Wachovia Georgia Municipal Bond Fund
1996(1) $11.00 4.31% 2.46%(5) 3.27%(5) 0.89%(5) 4.84%(5) $ 6,803 14%
1997 $11.11 5.63% 1.98% 3.18% 0.92% 4.24% $ 12,308 25%
1998 $11.38 6.62% 1.25% 3.62% 0.91% 3.96% $ 17,030 14%
1999(4) $11.13 (0.02%) 1.17%(5) 3.61%(5) 0.91%(5) 3.87%(5) $ 20,112 10%
Wachovia North Carolina Municipal Bond Fund
1996(1) $11.03 4.55% 1.49%(5) 3.51%(5) 0.84%(5) 4.16%(5) $ 28,283 7%
1997 $11.15 5.57% 1.27% 3.74% 0.85% 4.16% $ 44,104 17%
1998 $11.46 7.09% 1.01% 3.89% 0.85% 4.05% $ 56,760 9%
1999(4) $11.18 (0.02%) 1.00%(5) 3.75%(5) 0.85%(5) 3.90%(5) $ 69,506 4%
Wachovia South Carolina Municipal Bond Fund
1996(1) $11.05 4.86% 1.11%(5) 5.02%(5) 0.57%(5) 5.56%(5) $ 36,511 20%
1997 $11.12 6.23% 1.06% 4.53% 0.58% 5.01% $ 43,881 12%
1998 $11.36 7.15% 0.94% 4.41% 0.58% 4.77% $ 54,770 6%
1999(4) $11.10 0.19% 0.93%(5) 4.32%(5) 0.58%(5) 4.67%(5) $ 64,887 5%
Wachovia Virginia Municipal Bond Fund
1998(6) $10.49 4.61% 1.01%(5) 4.29%(5) 0.68%(5) 4.62%(5) $ 99,154 15%
1999(4) $10.30 0.43% 0.94%(5) 4.28%(5) 0.68%(5) 4.53%(5) $ 95,701 12%
</TABLE>
(1) Reflects operations for the period from July 22, 1996 (date of initial
public investment) to November 30, 1996.
(2) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(3) As a result of contractual obligations, certain fees were waived or
reimbursed. If such waivers or reimbursements had not occurred, the ratios
would have been as indicated.
(4) For six-months ended May 31, 1999 (unaudited). (5) Computed on an annualized
basis.
(6) Reflects operations for the period from March 29, 1998 (date of initial
public investment) to November 30, 1998.
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
The Wachovia Funds
The Wachovia Municipal Funds
Combined Notes to Financial Statements
May 31, 1999 (unaudited)
(1) Organization
The Wachovia Funds and The Wachovia Municipal Funds (individually referred to as
the "Trust" or collectively as the "Trusts") are registered under the Investment
Company Act of 1940, as amended (the "Act") as open-end management investment
companies. The Trusts consist of eighteen portfolios. The financial statements
of the following portfolios (individually referred to as the "Fund" or
collectively as the "Funds") are presented herein:
The Wachovia Funds*
<TABLE>
<CAPTION>
Portfolio Name Investment Objective
-------------- --------------------
<C> <S>
Wachovia Equity Fund ("Equity Fund") To produce
growth of principal and income.
Wachovia Quantitative Equity Fund To provide growth of principal and
("Quantitative Equity Fund") income. Wachovia Growth & Income Fund To provide
total return through ("Growth & Income Fund") growth of capital and current
income. Wachovia Equity Index Fund To provide a total return that ("Equity
Index Fund") approximates that of the stock market
as measured by the S&P 500 Index.
Wachovia Special Values Fund To produce growth of principal.
("Special Values Fund")
Wachovia Emerging Markets Fund To produce long-term capital
("Emerging Markets Fund") appreciation.
Wachovia Balanced Fund ("Balanced Fund") To provide long-term growth of
principal and current income.
Wachovia Fixed Income Fund To seek a high level of total return. ("Fixed Income
Fund") Wachovia Intermediate Fixed Income Fund To seek current income
consistent ("Intermediate Fixed Income Fund") with preservation of capital.
Wachovia Short-Term Fixed Income Fund To produce a high level of current
("Short-Term Fixed Income Fund") income.
</TABLE>
The Wachovia Municipal Funds
<TABLE>
<CAPTION>
Portfolio Name Investment Objective
-------------- --------------------
<C> <S>
Wachovia Georgia Municipal Bond Fund To provide current income which is
("Georgia Municipal Bond Fund")** exempt from federal regular income tax
and the income taxes imposed by the
State of Georgia.
Wachovia North Carolina Municipal Bond To provide current income which is Fund
("North Carolina Municipal Bond exempt from federal regular income tax Fund")**
and the income taxes imposed by the
State of North Carolina.
Wachovia South Carolina Municipal Bond To provide current income which is Fund
("South Carolina Municipal Bond exempt from federal regular income tax Fund")**
and South Carolina state income taxes.
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
The Wachovia Funds
The Wachovia Municipal Funds
The Wachovia Municipal Funds (continued)
<TABLE>
<CAPTION>
Portfolio Name Investment Objective
-------------- --------------------
<C> <S>
Wachovia Virginia Municipal Bond Fund To provide a high level of current
("Virginia Municipal Bond Fund")** income that is exempt from federal
regular income tax and the income tax
imposed by the Commonwealth of Virginia
as is consistent with the preservation of
capital.
</TABLE>
* In addition, The Wachovia Funds offer the following money market portfolios,
each having distinctive investment objectives and policies: Wachovia Money
Market Fund, Wachovia Prime Cash Management Fund, Wachovia Tax-Free Money
Market Fund, and Wachovia U.S. Treasury Money Market Fund. The financial
statements of the money market portfolios are presented separately.
** Non-diversified portfolio.
The assets of each portfolio are segregated and a shareholder's interest is
limited to the portfolio in which shares are held.
Three portfolios of the MarketWatch Funds (MarketWatch Equity Fund, MarketWatch
Intermediate Fixed Income Fund and MarketWatch Virginia Municipal Bond Fund)
were merged into Class A Shares of new portfolios of the Trusts to create,
respectively, the Growth & Income Fund, the Intermediate Fixed Income Fund and
the Virginia Municipal Bond Fund (the "New Funds"). The New Funds offer two
classes of shares: Class A Shares and Class Y Shares. Simultaneous with the
merger, Class A Shares held by certain shareholders of the New Funds were
exchanged for Class Y Shares.
(2) Significant Accounting Policies
The following is a summary of significant accounting policies consistently
followed by the Funds in the preparation of their financial statements. These
policies are in conformity with generally accepted accounting principles.
Investment Valuations--Municipal bonds are valued by an independent pricing
service, taking into consideration yield, liquidity, risk, credit quality,
coupon, maturity, type of issue, and any other factors or market data the
pricing service deems relevant. U.S. government securities, listed corporate
bonds, other fixed income and asset-backed securities, unlisted securities and
private placement securities are generally valued at the latest bid prices as
furnished by an independent pricing service. Listed equity securities and
investments in closed-end investment companies are valued at the last sale
price reported on a national securities exchange. Short-term securities are
valued at the prices provided by an independent pricing service. However,
short-term securities with remaining maturities of sixty days or less at the
time of purchase may be valued at amortized cost, which approximates fair
market value. Investments in other open-end regulated investment companies are
valued at net asset value. With respect to valuation of foreign securities,
trading in foreign cities may be completed at times which vary from the
closing of the New York Stock Exchange. Therefore, foreign securities are
valued at the latest closing price on the exchange on which they are traded
prior to the closing of the New York Stock Exchange. Foreign securities quoted
in foreign currencies are translated into U.S. dollars at the foreign exchange
rate in effect at noon, eastern time, on the day the value of the foreign
security is determined.
Repurchase Agreements--It is the policy of the Funds to require the custodian
bank to take possession, to have legally segregated in the Federal Reserve
Book Entry System, or to have segregated within the custodian bank's vault,
all securities held as collateral under repurchase agreement transactions.
Additionally, procedures have been established by the Funds to monitor, on a
daily basis, the market value of each repurchase agreement's collateral to
ensure that the value of collateral at least equals the repurchase price to be
paid under the repurchase agreement transaction.
The Funds will only enter into repurchase agreements with banks and other
recognized financial institutions, such as broker/dealers, which are deemed by
the Funds' adviser to be creditworthy pursuant to the guidelines and/or
standards reviewed or established by the Boards of Trustees (the "Trustees").
Risks may arise from the potential inability of counterparties to honor the
terms of the repurchase agreement. Accordingly, the Funds could receive less
than the repurchase price on the sale of collateral securities.
Investment Income, Expenses and Distributions--Interest income and expenses
are accrued daily. Bond premium and discount, if applicable, are amortized as
required by the Internal Revenue Code, as amended (the "Code").
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
The Wachovia Funds
The Wachovia Municipal Funds
Dividend income and distributions to shareholders are recorded on the ex-
dividend date. Certain dividends from foreign securities may be recorded after
the ex-dividend date based upon when the Fund is reasonably able to obtain
information.
Federal Taxes--It is the Funds' policy to comply with the provisions of the
Code applicable to regulated investment companies and to distribute to
shareholders each year substantially all of their income. Accordingly, no
provisions for federal tax are necessary.
Withholding taxes on foreign interest and dividends of $116,543 have been
provided for in accordance with the Emerging Markets Fund's understanding of
the applicable country's tax rules and rates.
At November 30, 1998, the Funds listed below, for federal tax purposes, had
capital loss carryforwards, as noted, which will reduce each Fund's taxable
income arising from future net realized gain on investments, if any, to the
extent permitted by the Code, and thus will reduce the amount of the
distributions to shareholders which would otherwise be necessary to relieve
the Funds of any liability for federal tax.
<TABLE>
<CAPTION>
Total Amount Amount Amount Amount Amount
Tax Loss Expiring Expiring Expiring Expiring Expiring
Fund Carryforward In 2002 In 2003 In 2004 In 2005 In 2006
---- ------------ ---------- ---------- -------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C>
Emerging Markets Fund $28,870,640 -- -- -- $3,405,307 $25,465,333
Short-Term Fixed
Income Fund $ 3,556,146 $2,752,111 $ 250,580 $467,184 $ 86,271 --
Virginia Municipal
Bond Fund $ 1,604,493 -- $1,119,966 -- $ 484,527 --
</TABLE>
When-Issued and Delayed Delivery Transactions--The Funds may engage in
when-issued or delayed delivery transactions. The Funds record when-issued
securities on the trade date and maintain security positions such that
sufficient liquid assets will be available to make payment for the securities
purchased. Securities purchased on a when-issued or delayed delivery basis are
marked to market daily and begin earning interest on the settlement date.
Futures Contracts--The Funds listed below purchase stock index or bond futures
contracts to manage cashflows, enhance yield, and to potentially reduce
transaction costs. Upon entering into a futures contract with a broker, the
Funds listed below are required to deposit in a segregated account a specified
amount of cash or U.S. government securities. Futures contracts are valued
daily and unrealized gains or losses are recorded in a "variation margin"
account. Daily, the Funds receive from or pay to the broker a specified amount
of cash based upon changes in the variation margin account. When a contract is
closed, the Funds recognize a realized gain or loss.
For the period ended May 31, 1999, the following Funds had realized
gains/losses on futures contracts as follows:
<TABLE>
<CAPTION>
Realized Gain (Loss)
Fund on Futures Contracts
---- --------------------
<S> <C>
Equity Fund $ 9,423,784
Quantitative Equity Fund 7,795,628
Growth & Income Fund 3,612,616
Equity Index Fund 12,418,456
Special Values Fund 1,810,865
Balanced Fund 6,732,246
Fixed Income Fund (7,497)
Intermediate Fixed Income Fund 54,183
</TABLE>
Futures contracts have market risks, including the risk that the change in the
value of the contract may not correlate with changes in the value of the
underlying securities.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds
The Wachovia Municipal Funds
At May 31,1999, the Funds had outstanding futures contracts as set forth
below:
Equity Fund
<TABLE>
<CAPTION>
Unrealized
Contracts to Appreciation/
Expiration Date Deliver/Receive Position (Depreciation)
--------------- --------------- -------- --------------
<S> <C> <C> <C>
June 1999 74 S&P 500 Index Futures Long $ (84,018)
June 1999 83 S&P Midcap 400 Futures Long 679,436
---------
$ 595,418
Quantitative Equity Fund
<CAPTION>
Unrealized
Contracts to Appreciation/
Expiration Date Deliver/Receive Position (Depreciation)
--------------- ---------------- -------- --------------
<S> <C> <C> <C>
June 1999 57 S&P 500 Index Futures Long $(110,526)
June 1999 89 S&P Midcap 400 Futures Long 688,663
---------
$ 578,137
Growth & Income Fund
<CAPTION>
Unrealized
Contracts to Appreciation/
Expiration Date Deliver/Receive Position (Depreciation)
--------------- --------------- -------- --------------
<S> <C> <C> <C>
June 1999 22 S&P 500 Index Futures Long $ (53,127)
June 1999 91 S&P Midcap 400 Futures Long 744,872
---------
$ 691,745
Equity Index Fund
<CAPTION>
Contracts to Unrealized
Expiration Date Deliver/Receive Position (Depreciation)
--------------- --------------- -------- --------------
<S> <C> <C> <C>
June 1999 183 S&P 500 Index Futures Long $(695,889)
Special Values Fund
<CAPTION>
Contracts to Unrealized
Expiration Date Deliver/Receive Position Appreciation
--------------- --------------- -------- --------------
<S> <C> <C> <C>
June 1999 50 S&P Midcap 400 Futures Long $ 673,350
Balanced Fund
<CAPTION>
Unrealized
Contracts to Appreciation/
Expiration Date Deliver/Receive Position (Depreciation)
--------------- --------------- -------- --------------
<S> <C> <C> <C>
June 1999 19 S&P 500 Index Futures Long $(248,262)
June 1999 57 S&P Midcap 400 Futures Long 441,169
June 1999 49 5-Year U.S. Treasury Notes Futures Long (58,535)
June 1999 10 5-Year U.S. Treasury Notes Futures Long 8,835
June 1999 28 10-Year U.S. Treasury Notes Futures Long 57,395
June 1999 40 U.S. Treasury Bond Futures Long 92,216
---------
$ 292,818
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
The Wachovia Funds
The Wachovia Municipal Funds
Fixed Income Fund
<TABLE>
<CAPTION>
Unrealized
Contracts to Appreciation/
Expiration Date Deliver/Receive Position (Depreciation)
--------------- --------------- -------- --------------
<S> <C> <C> <C>
June 1999 30 Euro Bond Futures Long $ 19,486
June 1999 20 5 Year U.S. Treasury Notes Futures Long 17,671
June 1999 98 10 Year U.S. Treasury Notes Futures Long 243,679
June 1999 59 U.S. Treasury Bond Futures Long (92,200)
September 1999 40 CAN 10 Year Bond Futures Long 4,589
September 1999 40 CAN 10 Year Bond Futures Long (2,011)
--------
$191,214
Intermediate Fixed Income Fund
<CAPTION>
Contracts to Unrealized
Expiration Date Deliver/Receive Position Appreciation
--------------- --------------- -------- --------------
<S> <C> <C> <C>
June 1999 10 5-Year U.S. Treasury Notes Futures Short $ 8,835
June 1999 6 10-Year U.S. Treasury Notes Futures Short 5,582
June 1999 6 20-Year U.S. Treasury Bond Futures Short 10,239
--------
$ 24,656
</TABLE>
Foreign Exchange Contracts--Emerging Markets Fund may enter into foreign
currency exchange contracts as a way of managing foreign exchange rate risk.
The Fund may enter into these contracts for the purchase or sale of a specific
foreign currency at a fixed price on a future date as a hedge or cross hedge
against either specific transactions or portfolio positions. The objective of
the Fund's foreign currency hedging transactions is to reduce the risk that
the U.S. dollar value of the Fund's foreign currency denominated securities
will decline in value due to changes in foreign currency exchange rates. All
foreign currency exchange contracts are "marked to market" daily at the
applicable translation rates resulting in unrealized gains or losses. Realized
gains or losses are recorded at the time the foreign currency exchange
contract is offset by entering into a closing transaction or by the delivery
or receipt of the currency. Risk may arise upon entering into these contracts
from the potential inability of counterparties to meet the terms of their
contracts and from unanticipated movements in the value of a foreign currency
relative to the U.S. dollar. At May 31, 1999, Emerging Markets Fund had no
outstanding foreign currency contracts.
Foreign Currency Translation--The accounting records of Emerging Markets Fund
are maintained in U.S. dollars. All assets and liabilities denominated in
foreign currencies ("FC") are translated into U.S. dollars based on the rate
of exchange of such currencies against U.S. dollars on the date of valuation.
Purchases and sales of securities, income and expenses are translated at the
rate of exchange quoted on the respective date that such transactions are
recorded. Differences between income and expense amounts recorded and
collected or paid are adjusted when reported by the custodian bank. The Fund
does not isolate that portion of the results of operations resulting from
changes in foreign exchange rates on investments from the fluctuations arising
from changes in market prices of securities held. Such fluctuations are
included with the net realized and unrealized gain or loss from investments.
Reported net realized foreign exchange gains or losses arise from sales of
portfolio securities, sales and maturities of short-term securities, sales of
FCs, currency gains or losses realized between the trade and settlement dates
on securities transactions, the difference between the amounts of dividends,
interest, and foreign withholding taxes recorded on the Fund's books, and the
U.S. dollar equivalent of the amounts actually received or paid. Net
unrealized foreign exchange gains and losses arise from changes in the value
of assets and liabilities other than investments in securities at fiscal year
end, resulting from changes in the exchange rate.
Restricted Securities--Restricted securities are securities that may only be
resold upon registration under federal securities laws or in transactions
exempt from such registration. Many restricted securities may be resold in the
secondary market in transactions exempt from registration. Such restricted
securities may be determined to be liquid under criteria established by the
Trustees. The Funds will not incur any registration costs upon such resales.
The Funds' restricted securities are valued at the price provided by dealers
in the secondary market or, if no market prices are available, at the fair
value as determined by the Funds' pricing committee.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
The Wachovia Funds
The Wachovia Municipal Funds
Use of Estimates--The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the amounts of assets, liabilities, expenses and
revenues reported in the financial statements. Actual results could differ
from those estimated. Other--Investment transactions are accounted for on the
trade date.
(3) Shares of Beneficial Interest
The Declaration of Trust of both The Wachovia Funds and The Wachovia Municipal
Funds permits the Trustees to issue an unlimited number of full and fractional
shares of beneficial interest (without par value). Transactions in shares were
as follows: <TABLE> <CAPTION>
Equity Fund Quantitative Equity Fund
-------------------------------------------------- ------------------------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
May 31, 1999 November 30, 1998 May 31, 1999 November 30, 1998
Class A Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars
- ----------------------------------------------------------------------- ------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 3,592,818 $ 56,344,101 924,716 $ 13,703,327 563,627 $ 11,709,669 2,588,389 $ 48,886,094
Shares issued to
shareholders in
payment
of distributions
declared 449,942 6,534,315 353,528 4,797,366 161,201 3,250,235 222,235 3,819,153
Shares redeemed (473,189) (7,435,786) (506,801) (7,457,571) (727,706) (15,198,715) (599,567) (11,284,446)
---------- ------------ ---------- ------------ -------- ------------ ---------- ------------
Net change re-
sulting from
Class A Shares
transactions 3,569,571 $ 55,442,630 771,443 $ 11,043,122 (2,878) $ (238,811) 2,211,057 $ 41,420,801
---------- ------------ ---------- ------------ -------- ------------ ---------- ------------
<CAPTION>
Six Months Ended Year Ended Six Months Ended Year Ended
May 31, 1999 November 30, 1998 May 31, 1999 November 30, 1998
Class B Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars
- ----------------------------------------------------------------------- ------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 65,535 $ 1,023,273 139,205 $ 2,092,971 135,027 $ 2,798,704 633,822 $ 12,088,957
Shares issued to
shareholders in
payment
of distributions
declared 46,508 673,905 29,176 393,654 35,264 708,822 39,020 665,947
Shares redeemed (16,024) (249,892) (32,270) (471,352) (50,878) (1,063,932) (53,666) (995,247)
---------- ------------ ---------- ------------ -------- ------------ ---------- ------------
Net change re-
sulting from
Class B Shares
transactions 96,019 $ 1,447,286 136,111 $ 2,015,273 119,413 $ 2,443,594 619,176 $ 11,759,657
---------- ------------ ---------- ------------ -------- ------------ ---------- ------------
<CAPTION>
Six Months Ended Year Ended Six Months Ended Year Ended
May 31, 1999 November 30, 1998 May 31, 1999 November 30, 1998
Class Y Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars
- ----------------------------------------------------------------------- ------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 1,975,867 $ 30,678,176 4,380,401 $ 64,007,995 420,009 $ 8,678,555 1,326,703 $ 24,567,733
Shares issued to
shareholders in
payment
of distributions
declared 1,165,689 16,929,189 1,000,056 13,577,140 368,067 7,427,363 1,014,452 17,399,559
Shares redeemed (3,627,257) (56,478,996) (2,944,530) (43,863,733) (359,692) (7,517,319) (1,761,030) (32,169,312)
---------- ------------ ---------- ------------ -------- ------------ ---------- ------------
Net change re-
sulting from
Class Y Shares
transactions (485,701) $ (8,871,631) 2,435,927 $ 33,721,402 428,384 $ 8,588,599 580,125 $ 9,797,980
---------- ------------ ---------- ------------ -------- ------------ ---------- ------------
Net change re-
sulting from fund
shares transac-
tions 3,179,889 $ 48,018,285 3,343,481 $ 46,779,797 544,919 $ 10,793,382 3,410,358 $ 62,978,438
---------- ------------ ---------- ------------ -------- ------------ ---------- ------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds
The Wachovia Municipal Funds
<TABLE>
<CAPTION>
Growth & Income Fund
----------------------------------------------------
Six Months Ended Year Ended
May 31, 1999 November 30, 1998
Class A Shares Shares Dollars Shares Dollars
- --------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 140,781 $ 3,140,750 500,103 $ 10,555,907
Shares issued to
shareholders in payment
of distributions
declared 749,086 15,902,669 484,959 9,614,799
Exchange into Class Y
shares -- -- (9,553,829) (213,145,727)
Shares redeemed (290,380) (6,549,509) (2,336,814) (48,594,932)
---------- ------------ ----------- -------------
Net change resulting
from Class A Shares
transactions 599,487 $ 12,493,910 (10,905,581) $(241,569,953)
---------- ------------ ----------- -------------
<CAPTION>
Six Months Ended Period Ended
May 31, 1999 November 30, 1998(1)
Class Y Shares Shares Dollars Shares Dollars
- --------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 511,380 $ 11,383,822 215,719 $ 4,785,076
Exchange from Class A
shares -- -- 9,553,829 213,145,727
Shares issued to
shareholders in payment
of distributions
declared 198,174 4,210,246 7,342 153,661
Shares redeemed (1,078,572) (24,249,422) (1,021,427) (22,575,885)
---------- ------------ ----------- -------------
Net change resulting
from Class Y Shares
transactions (369,018) $ (8,655,354) 8,755,463 $ 195,508,579
---------- ------------ ----------- -------------
Net change resulting
from fund shares trans-
actions 230,469 $ 3,838,556 (2,150,118) $ (46,061,374)
---------- ------------ ----------- -------------
</TABLE>
(1) Reflects operations for the period from March 29, 1998 (date of initial
public investment) to November 30, 1998.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds
The Wachovia Municipal Funds
<TABLE>
<CAPTION>
Equity Index Fund Special Values Fund
---------------------------------------------------- ---------------------------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
May 31, 1999 November 30, 1998 May 31, 1999 November 30, 1998
Class A Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars
---------------------------------------------------------------------- ---------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 1,516,923 $ 36,355,682 3,701,907 $ 76,535,465 1,180,684 $ 18,022,444 2,610,113 $ 45,663,955
Shares issued to
shareholders in
payment of dis-
tributions de-
clared 127,455 2,928,715 109,762 2,088,409 221,666 3,320,559 248,937 4,102,490
Shares redeemed (763,890) (18,436,602) (636,039) (13,107,910) (849,522) (13,036,200) (1,202,936) (19,509,112)
---------- ------------- ---------- ------------- --------- ------------- ----------- ------------
Net change re-
sulting from
Class A Shares
transactions 880,488 $ 20,847,795 3,175,630 $ 65,515,964 552,828 $ 8,306,803 1,656,114 $ 30,257,333
---------- ------------- ---------- ------------- --------- ------------- ----------- ------------
<CAPTION>
Six Months Ended Year Ended Period Ended Year Ended
May 31, 1999 November 30, 1998 May 31, 1999(1) November 30, 1998
Class B Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars
---------------------------------------------------------------------- ---------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold -- -- -- -- 7,029 $ 108,359 -- --
Shares issued to
shareholders in
payment of dis-
tributions de-
clared -- -- -- -- -- -- -- --
Shares redeemed -- -- -- -- -- -- -- --
---------- ------------- ---------- ------------- --------- ------------- ----------- ------------
Net change re-
sulting from
Class B Shares
transactions -- -- -- -- -- -- -- --
---------- ------------- ---------- ------------- --------- ------------- ----------- ------------
Net change
resulting from
fund shares
transactions -- -- -- -- 7,029 $ 108,359 -- --
---------- ------------- ---------- ------------- --------- ------------- ----------- ------------
<CAPTION>
Six Months Ended Year Ended Six Months Ended Year Ended
May 31, 1999 November 30, 1998 May 31, 1999 November 30, 1998
Class Y Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars
---------------------------------------------------------------------- ---------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 1,996,431 $ 48,399,105 2,854,402 $ 58,057,370 1,113,573 $ 17,224,820 1,475,771 $ 25,185,127
Shares issued to
shareholders in
payment of dis-
tributions de-
clared 279,390 6,430,363 454,689 8,624,862 269,855 4,042,581 422,376 6,964,972
Shares redeemed (1,447,919) (34,954,876) (3,418,715) (70,167,430) (817,956) (12,744,445) (827,147) (13,991,139)
---------- ------------- ---------- ------------- --------- ------------- ----------- ------------
Net change re-
sulting from
Class Y Shares
transactions 827,902 $ 19,874,592 (109,624) $ (3,485,198) 565,472 $ 8,522,956 1,071,000 $ 18,158,960
---------- ------------- ---------- ------------- --------- ------------- ----------- ------------
Net change
resulting from
fund shares
transactions 1,708,390 $ 40,722,387 3,066,006 $ 62,030,766 1,125,329 $ 16,938,118 2,727,114 $ 48,416,293
---------- ------------- ---------- ------------- --------- ------------- ----------- ------------
</TABLE>
(1) Reflects operations for the period from March 26, 1999 (date of initial
public investment) to May 31, 1999.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds
The Wachovia Municipal Funds
<TABLE>
<CAPTION>
Emerging Markets Fund Balanced Fund
-------------------------------------------------- ----------------------------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
May 31, 1999 November 30, 1998 May 31, 1999 November 30, 1998
Class A Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars
-------------------------------------------------------------------- ----------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 1,009,740 $ 9,048,544 692,384 $ 6,536,524 12,021,714 $ 158,740,796 5,764,174 $ 75,056,038
Shares issued to
shareholders
in payment of
distributions
declared 5,838 48,574 7,323 79,306 1,006,791 12,815,614 490,771 6,104,654
Shares redeemed (603,341) (5,604,271) (389,449) (3,539,372) (6,845,971) (90,283,038) (1,421,643) (18,503,796)
---------- ------------ ---------- ------------ ----------- ------------- ---------- ------------
Net change
resulting from
Class A Shares
transactions 412,237 $ 3,492,847 310,258 $ 3,076,458 6,182,534 $ 81,273,372 4,833,302 $ 62,656,896
---------- ------------ ---------- ------------ ----------- ------------- ---------- ------------
<CAPTION>
Six Months Ended Year Ended Six Months Ended Year Ended
May 31, 1999 November 30, 1998 May 31, 1999 November 30, 1998
Class B Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars
-------------------------------------------------------------------- ----------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold -- -- -- -- 300,246 $ 3,940,970 593,884 $ 7,769,427
Shares issued to
shareholders
in payment of
distributions
declared -- -- -- -- 111,639 1,415,288 50,089 621,444
Shares redeemed -- -- -- -- (47,723) (629,562) (71,305) (925,661)
---------- ------------ ---------- ------------ ----------- ------------- ---------- ------------
Net change
resulting from
Class B Shares
transactions -- -- -- -- 364,162 $ 4,726,696 572,668 $ 7,465,210
---------- ------------ ---------- ------------ ----------- ------------- ---------- ------------
<CAPTION>
Six Months Ended Year Ended Six Months Ended Year Ended
May 31, 1999 November 30, 1998 May 31, 1999 November 30, 1998
Class Y Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars
-------------------------------------------------------------------- ----------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 1,040,146 $ 9,699,048 5,272,409 $ 53,125,694 1,613,439 $ 21,532,563 6,639,501 $ 84,289,682
Shares issued to
shareholders in
payment of dis-
tributions de-
clared 40,602 337,406 49,656 537,283 2,195,046 27,875,432 1,895,507 23,557,253
Shares redeemed (1,173,527) (10,499,314) (2,367,712) (21,683,002) (11,828,236) (156,357,423) (6,222,414) (80,542,002)
---------- ------------ ---------- ------------ ----------- ------------- ---------- ------------
Net change
resulting from
Class Y Shares
transactions (92,779) $ (462,860) 2,954,353 $ 31,979,975 (8,019,751) $(106,949,428) 2,312,594 $ 27,304,933
---------- ------------ ---------- ------------ ----------- ------------- ---------- ------------
Net change
resulting from
fund shares
transactions 319,458 $ 3,029,987 3,264,611 $ 35,056,433 (1,473,055) $ (20,949,360) 7,718,564 $ 97,427,039
---------- ------------ ---------- ------------ ----------- ------------- ---------- ------------
<CAPTION>
Intermediate
Fixed Income Fund Fixed Income Fund
-------------------------------------------------- ----------------------------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
May 31, 1999 November 30, 1998 May 31, 1999 November 30, 1998
Class A Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars
-------------------------------------------------------------------- ----------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 4,947,161 $ 49,196,032 1,958,828 $ 19,573,923 3,015 $ 30,125 432,820 $ 4,395,676
Shares issued to
shareholders in
payment of dis-
tributions de-
clared 123,484 1,227,016 89,113 890,891 17,939 181,027 36,581 370,365
Exchange from
Class Y shares -- -- -- -- -- -- (8,913,728) (89,493,831)
Shares redeemed (654,326) (6,515,407) (638,391) (6,425,094) (71,456) (717,574) (732,895) (7,416,845)
---------- ------------ ---------- ------------ ----------- ------------- ---------- ------------
Net change
resulting from
Class A Shares
transactions 4,416,319 $ 43,907,641 1,409,550 $ 14,039,720 (50,502) $ (506,422) (9,177,222) $(92,144,635)
---------- ------------ ---------- ------------ ----------- ------------- ---------- ------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds
The Wachovia Municipal Funds
<TABLE>
<CAPTION>
Intermediate Fixed
Fixed Income Fund (continued) Income Fund (continued)
---------------------------------------------------- -------------------------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
May 31, 1999 November 30, 1998 May 31, 1999 November 30, 1998
Class B Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars
---------------------------------------------------------------------- -------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 32,995 $ 331,227 39,258 $ 390,310 -- -- -- --
Shares issued to
shareholders
in payment of
distributions
declared 1,349 13,435 1,271 12,687 -- -- -- --
Shares redeemed (525) (5,234) (2,161) (21,523) -- -- -- --
----------- ------------ ----------- ------------ ---------- ------------ --------- ------------
Net change
resulting from
Class B Shares
transactions 33,819 $ 339,428 38,368 $ 381,474 -- -- -- --
----------- ------------ ----------- ------------ ---------- ------------ --------- ------------
<CAPTION>
Six Months Ended Year Ended Period Ended Period Ended
May 31, 1999 November 30, 1998 May 31, 1999 November 30, 1998(1)
Class Y Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars
---------------------------------------------------------------------- -------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 5,734,254 $ 57,337,941 6,174,243 $ 61,683,285 927,248 $ 9,368,089 512,332 $ 5,220,989
Exchange from
Class A shares -- -- -- -- -- -- 8,913,728 89,493,831
Shares issued to
shareholders
in payment of
distributions
declared 360,761 3,597,093 661,726 6,595,044 22,687 228,683 21,849 222,630
Shares redeemed (4,890,677) (48,961,597) (4,662,142) (46,579,297) (1,320,986) (13,273,489) (986,184) (10,094,154)
----------- ------------ ----------- ------------ ---------- ------------ --------- ------------
Net change
resulting from
Class Y Shares
transactions 1,204,338 $ 11,973,437 2,173,827 $ 21,699,032 (371,051) $ (3,676,717) 8,461,725 $ 84,843,296
----------- ------------ ----------- ------------ ---------- ------------ --------- ------------
Net change
resulting from
fund shares
transactions 5,654,476 $ 56,220,506 3,621,745 $ 36,120,226 (421,553) $ (4,183,139) (715,497) $ (7,301,339)
----------- ------------ ----------- ------------ ---------- ------------ --------- ------------
(1) Reflects operations for the period from March 29, 1998 (date of initial
public investment) to November 30, 1998.
<CAPTION>
Short-Term Fixed Income Fund
----------------------------------------------------
Six Months Ended Year Ended
May 31, 1999 November 30, 1998
Class A Shares Shares Dollars Shares Dollars
- -----------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 182,433 $ 1,801,893 728,996 $ 7,145,299
Shares issued to
shareholders in
payment of dis-
tributions
declared 28,980 284,467 48,837 478,947
Shares redeemed (219,781) (2,174,449) (465,982) (4,580,525)
----------- ------------ ----------- ------------
Net change
resulting from
Class A Shares
transactions (8,368) $ (88,089) 311,851 $ 3,043,721
----------- ------------ ----------- ------------
<CAPTION>
Six Months Ended Year Ended
May 31, 1999 November 30, 1998
Class Y Shares Shares Dollars Shares Dollars
- ---------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 909,342 $ 8,964,379 2,210,120 $ 21,733,419
Shares issued to
shareholders
in payment of
distributions
declared 167,234 1,645,549 500,524 4,905,077
Shares redeemed (7,490,898) (74,017,502) (2,109,395) (20,644,860)
----------- ------------ ----------- ------------
Net change
resulting from
Class Y Shares
transactions (6,414,322) $(63,407,574) 601,249 $ 5,993,636
----------- ------------ ----------- ------------
Net change
resulting from
fund shares
transactions (6,422,690) $(63,495,663) 913,100 $ 9,037,357
----------- ------------ ----------- ------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds
The Wachovia Municipal Funds
<TABLE>
<CAPTION>
Georgia Municipal Bond Fund North Carolina Municipal Bond Fund
---------------------------------------------- ----------------------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
May 31, 1999 November 30, 1998 May 31, 1999 November 30, 1998
Class A Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars
<S> <C> <C> <C> <C> <C> <C> <C> <C>
------------------------ --------- ----------- --------- ----------- --------- ----------- --------- -----------
Shares sold 21,125 $ 239,735 65,313 $ 734,230 57,845 $ 656,192 73,195 $ 827,761
Shares issued to share-
holders
in payment of distribu-
tions
declared 9,055 102,498 18,608 209,598 13,989 159,240 28,831 326,515
Shares redeemed (37,672) (426,630) (65,246) (732,153) (36,762) (416,781) (308,552) (3,504,406)
--------- ----------- --------- ----------- --------- ----------- --------- -----------
Net change resulting
from Class A Shares
transactions (7,492) $ (84,397) 18,675 $ 211,675 35,072 $ 398,651 (206,526) $(2,350,130)
--------- ----------- --------- ----------- --------- ----------- --------- -----------
<CAPTION>
Six Months Ended Year Ended Six Months Ended Year Ended
May 31, 1999 November 30, 1998 May 31, 1999 November 30, 1998
Class Y Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars
<S> <C> <C> <C> <C> <C> <C> <C> <C>
------------------------ --------- ----------- --------- ----------- --------- ----------- --------- -----------
Shares sold 480,638 $ 5,439,198 514,361 $ 5,807,306 1,506,651 $17,062,398 1,450,528 $16,388,977
Shares issued to share-
holders
in payment of distribu-
tions
declared 2,978 33,708 5,535 62,357 21,284 242,429 17,718 200,910
Shares redeemed (174,130) (1,972,022) (130,688) (1,473,631) (266,329) (3,026,409) (465,404) (5,270,187)
--------- ----------- --------- ----------- --------- ----------- --------- -----------
Net change resulting
from
Class Y Shares transac-
tions 309,486 $ 3,500,884 389,208 $ 4,396,032 1,261,606 $14,278,418 1,002,842 $11,319,700
--------- ----------- --------- ----------- --------- ----------- --------- -----------
Net change resulting
from
fund shares transactions 301,994 $ 3,416,487 407,883 $ 4,607,707 1,296,678 $14,677,069 796,316 $ 8,969,570
--------- ----------- --------- ----------- --------- ----------- --------- -----------
<CAPTION>
South Carolina Municipal Bond Fund
----------------------------------------------
Six Months Ended Year Ended
May 31, 1999 November 30, 1998
Class A Shares Shares Dollars Shares Dollars
- ----------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 304,067 $ 3,428,213 742,299 $ 8,356,816
Shares issued to share-
holders in payment of
distributions declared 78,664 888,358 167,413 1,887,761
Shares redeemed (336,946) (3,799,002) (786,074) (8,835,765)
--------- ----------- --------- -----------
Net change resulting
from Class A Shares
transactions 45,785 $ 517,569 123,638 $ 1,408,812
--------- ----------- --------- -----------
<CAPTION>
Six Months Ended Year Ended
May 31, 1999 November 30, 1998
Class Y Shares Shares Dollars Shares Dollars
- ----------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 1,258,933 $14,141,556 1,382,049 $15,581,081
Shares issued to share-
holders in payment of
distributions declared 7,926 89,544 13,296 149,911
Shares redeemed (245,267) (2,766,751) (517,410) (5,814,407)
--------- ----------- --------- -----------
Net change resulting
from Class Y Shares
transactions 1,021,592 $11,464,349 877,935 $ 9,916,585
--------- ----------- --------- -----------
Net change resulting
from fund shares
transactions 1,067,377 $11,981,918 1,001,573 $11,325,397
--------- ----------- --------- -----------
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
The Wachovia Funds
The Wachovia Municipal Funds
<TABLE>
<CAPTION>
Virginia Municipal Bond Fund
------------------------------------------------
Six Months Ended Year Ended
May 31, 1999 November 30, 1998
Class A Shares Shares Dollars Shares Dollars
- -----------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 19,328 $ 202,445 293,734 $ 3,057,205
Shares issued to share-
holders in payment of
distributions declared 11,540 120,709 29,282 304,418
Exchange into Class Y
shares -- -- (9,794,711) (101,277,312)
Shares redeemed (41,747) (435,863) (488,052) (5,071,444)
-------- ----------- ---------- -------------
Net change resulting
from Class A
Shares transactions (10,879) $ (112,709) (9,959,747) $(102,987,133)
-------- ----------- ---------- -------------
<CAPTION>
Six Months Ended Period Ended
May 31, 1999(1) November 30, 1998(1)
Class Y Shares Shares Dollars Shares Dollars
- -----------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 628,848 $ 6,572,250 561,359 $ 5,860,078
Exchange from Class A
shares -- -- 9,794,711 101,277,312
Shares issued to share-
holders in payment of
distributions declared 3,108 32,498 3,580 37,331
Shares redeemed (784,802) (8,205,077) (910,974) (9,483,614)
-------- ----------- ---------- -------------
Net change resulting
from Class Y Shares
transactions (152,846) $(1,600,329) 9,448,676 $ 97,691,108
-------- ----------- ---------- -------------
Net change resulting
from fund shares
transactions (163,725) $(1,713,038) (511,071) $ (5,296,025)
-------- ----------- ---------- -------------
</TABLE>
(1) Reflects operations for the period from March 29, 1998 (date of initial
public investment) to November 30, 1998.
(4) Investment Advisory Fee and Other Transactions with Affiliates Investment
Advisory Fee--Wachovia Asset Management, the Funds' investment adviser (the
"Adviser"), receives for its services an annual investment advisory fee based on
a percentage of each Fund's average daily net assets as listed below. As a
result of contractual obligations, the Adviser may be required to waive a
portion of its fee. The Adviser can modify or terminate this waiver at its sole
discretion at any time after January 31, 2000.
<TABLE>
<CAPTION>
Fund Annual Rate
---- -----------
<S> <C>
Equity Fund 0.70%
Quantitative Equity Fund 0.70%
Growth & Income Fund 0.70%*
Equity Index Fund 0.30%
Special Values Fund 0.80%
Emerging Markets Fund 1.00%
Balanced Fund 0.70%
Fixed Income Fund 0.60%
Intermediate Fixed Income Fund 0.60%*
Short-Term Fixed Income Fund 0.55%
Georgia Municipal Bond Fund 0.75%
North Carolina Municipal Bond Fund 0.75%
South Carolina Municipal Bond Fund 0.75%
Virginia Municipal Bond Fund 0.74%
</TABLE>
* Prior to March 29, 1998, the annual investment advisory fee based on a
percentage of the Fund's average daily net assets for Growth & Income Fund,
and Intermediate Fixed Income Fund was 1.00% and 0.74%, respectively.
Effective March 29, 1998, Growth & Income Fund, Intermediate Fixed Income
Fund, and Virginia Municipal Bond Fund changed investment advisors from
Central Fidelity National Bank to Wachovia Asset Management.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
The Wachovia Funds
The Wachovia Municipal Funds
Sub Advisory Fee--The Adviser has entered into a sub-advisory agreement with
Twin Capital Management, Inc. (the "Sub-Adviser"). The Sub-Adviser furnishes
certain advisory services to the Adviser for Quantitative Equity Fund, including
investment research, quantitative analysis, statistical and other factual
information, and recommendations based on the Sub-Adviser's analysis, and
assists the Adviser in identifying securities for potential purchase and/or
sale. The Sub-Adviser is entitled to receive an annual fee of $55,000 payable by
the Adviser. The Sub-Adviser may elect to waive some or all of its fee.
Administrative Fee, and Transfer and Dividend Disbursing Agent and Portfolio
Accounting Fees--Federated Services Company ("FServ") provides the Funds with
certain administrative personnel and portfolio accounting services. FServ,
through its subsidiary Federated Shareholder Services Company ("FSSC"), serves
as transfer and dividend disbursing agent for the Funds. The fee paid to FServ
is based on the level of average aggregate net assets of the Trusts (excluding
Wachovia Prime Cash Management Fund) for the period. Effective March 29, 1998,
Growth & Income Fund, Intermediate Fixed Income Fund, and Virginia Municipal
Bond Fund changed administrators, transfer agents, and portfolio accountants
from BISYS Fund Services, L.P. to FServ.
Distribution Services Fee--Equity Fund, Quantitative Equity Fund, Balanced Fund,
and Fixed Income Fund have adopted a Distribution Plan (the "Plan") pursuant to
Rule 12b-1 under the Act. Under the terms of the Plan, the Funds will compensate
Federated Securities Corp. ("FSC"), the principal distributor, from their
respective net assets to finance certain activities intended to result in the
sale of Class B Shares. The Plan provides that each Fund may incur distribution
expenses up to 0.75% of the average daily net assets of each Fund's Class B
Shares, annually, to compensate FSC. FSC may voluntarily choose to waive any
portion of its fee and/or reimburse certain operating expenses of the Funds. FSC
can modify or terminate this voluntary waiver and/or reimbursement at any time
at its sole discretion. Effective March 29, 1998, Growth & Income Fund,
Intermediate Fixed Income Fund, and Virginia Municipal Bond Fund changed
distributors from BISYS Fund Services to FSC.
Prior to March 29, 1998, Growth & Income Fund, Intermediate Fixed Income Fund,
and Virginia Municipal Bond Fund could incur distribution expenses up to 0.25%
of the average daily net assets of each Fund's Class A Shares. Effective March
29,1998, Class A Shares no longer incur distribution expenses.
Shareholder Services Fee--Under the terms of a Shareholder Services Agreement
with Federated Administrative Services, ("FAS"), the Fund will pay FAS up to
0.25% of average daily net assets of each Fund's Class A Shares and Class B
Shares for the period. The fee paid to FAS is used to finance certain services
for shareholders and to maintain shareholder accounts. FAS may voluntarily
choose to waive any portion of its fee. FAS can modify or terminate this
voluntary waiver at any time at its sole discretion.
Custodian Fees--Wachovia Bank, N.A. is the Funds' custodian. The fee is based on
the level of each Fund's average daily net assets for the period, plus
out-of-pocket expenses. Effective March 29, 1998, Growth & Income Fund,
Intermediate Fixed Income Fund, and Virginia Municipal Bond Fund changed
custodians from Central Fidelity National Bank to Wachovia Bank N.A.
Organizational Expenses--Organizational expenses were borne initially by FAS.
The Funds have agreed to reimburse FAS for the organizational expenses during
the five year period following the effective date of each Fund. For the period
ended May 31, 1999, the Funds made the following reimbursements to FAS pursuant
to this agreement: <TABLE> <CAPTION>
Organizational Organizational
Fund Expenses Expenses Paid
- ---- -------------- --------------
<S> <C> <C>
Emerging Markets Fund $40,764 $8,894
Georgia Municipal Bond Fund 30,000 4,569
North Carolina Municipal Bond Fund 30,000 294
</TABLE>
General--Certain of the Officers of the Trusts are Officers and Directors or
Trustees of the above companies.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
The Wachovia Funds
The Wachovia Municipal Funds
(5) Investment Transactions
Purchases and sales of investments, excluding short-term securities, for the
period ended May 31, 1999, were as follows:
<TABLE>
<CAPTION>
Fund Purchases Sales
- ---- ------------ ------------
<S> <C> <C>
Equity Fund $ 98,783,632 $ 72,912,313
Quantitative Equity Fund 78,912,434 77,459,570
Growth & Income Fund 44,496,551 88,838,625
Equity Index Fund 50,902,933 14,897,564
Special Values Fund 27,913,883 23,518,041
Emerging Markets Fund 47,455,141 43,208,426
Balanced Fund 150,707,084 180,149,848
Fixed Income Fund 134,831,656 85,879,947
Intermediate Fixed Income Fund 52,218,366 54,756,045
Short-Term Fixed Income Fund 9,143,966 67,821,017
Georgia Municipal Bond Fund 5,490,956 2,395,751
North Carolina Municipal Bond Fund 12,680,045 2,762,938
South Carolina Municipal Bond Fund 10,391,927 5,446,231
Virginia Municipal Bond Fund 11,930,859 13,863,893
</TABLE>
(6) Concentration of Credit Risk
Emerging Markets Fund invests in securities of non-U.S. issuers. Although the
Fund maintains a diversified investment portfolio, the political or economic
developments within a particular country or region may have an adverse effect on
the ability of domiciled issuers to meet their obligations. Additionally,
political or economic developments may have an effect on the liquidity and
volatility of portfolio securities and currency holdings. At May 31, 1999, the
diversification of the industries for the Emerging Markets Fund was as follows:
<TABLE> <CAPTION>
% of Net
Industry Assets
-------- --------
<S> <C>
Financial Services 23.7%
Communication Services 19.1%
Consumer Staples 9.7%
Basic Materials 9.7%
Energy 6.1%
Technology 6.0%
Closed-End Funds 5.7%
Utilities 5.1%
Consumer Cyclicals 4.3%
Health Care 2.7%
Multi-Industry 2.6%
Open-End Funds 2.6%
Capital Goods 2.4%
Transportation 1.1%
</TABLE>
Since The Wachovia Municipal Funds invest a substantial portion of their assets
in issuers located in one state, they will be more susceptible to factors
adversely affecting issuers of that state than would be a comparable tax-exempt
mutual fund that invests nationally. In order to reduce the credit risk
associated with such factors, at May 31, 1999, the securities in the portfolio
of investments are backed by letters of credit or bond insurance of various
financial institutions and financial guaranty assurance agencies, as indicated
below. The largest percentage of investments insured by or supported (backed) by
a letter of credit from any one institution or agency is also indicated below.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
The Wachovia Funds
The Wachovia Municipal Funds
<TABLE>
<CAPTION>
% of Portfolio % of Portfolio Backed by
Fund Guaranteed/Insured Largest Guarantor/Insurer
- ---- ------------------ -------------------------
<S> <C> <C>
Georgia Municipal Bond
Fund 43.86% 20.42%
North Carolina Municipal
Bond Fund 27.02% 16.91%
South Carolina Municipal
Bond Fund 56.35% 23.85%
Virginia Municipal Bond
Fund 24.66% 10.69%
</TABLE>
(7) Year 2000
Similar to other financial organizations, the Trusts could be adversely affected
if the computer systems used by the Trusts' service providers do not properly
process and calculate date-related information and data from and after January
1, 2000. The Trusts' Adviser and administrator are taking measures that they
believe are reasonably designed to address the Year 2000 issue with respect to
computer systems that they use and to obtain reasonable assurances that
comparable steps are being taken by each of the Trusts' other service providers.
At this time, however, there can be no assurance that these steps will be
sufficient to avoid any adverse impact to the Trusts.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Trustees Officers
James A. Hanley John W. McGonigle
Samuel E. Hudgins President and Treasurer
J. Berkley Ingram, Jr. Charles L. Davis, Jr.
D. Dean Kaylor Vice President and Assistant Treasurer
Alvin J. Schexnider Peter J. Germain
Charles S. Way, Jr. Secretary
Gail Cagney
Assistant Secretary
Mutual funds are not bank deposits or obligations, are not guaranteed by any
bank, and are not insured or guaranteed by the U.S. government, the Federal
Deposit Insurance Corporation, the Federal Reserve Board, or any other
government agency. Investment in mutual funds involves risk, including possible
loss of principal.
This report is authorized for distribution to prospective investors only when
preceded or accompanied by the fund's prospectus which contains facts concerning
its investment objective and policies, management fees, expenses and other
information.
Cusips
929901734 929901601 929901401
929901742 929901502 929901302
929901759 929901692 929902500
929901809 929901718 929902609
929901882 929901726 929902104
929901700 929901650 929902203
929901676 929901643 929902708
929901668 929901783 929902807
929901767 929901791
929901775 929901817 G01715-01 (7/99)
929901841 929901866
929901858 929901874
Federated Securities Corp., Distributor
831-27 (7/99)
WACHOVIA MONEY MARKET FUND
WACHOVIA TAX-FREE
MONEY MARKET FUND
WACHOVIA U.S. TREASURY
MONEY MARKET FUND
INVESTMENT SHARES
Semi-Annual Report
May 31, 1999
[LOGO]
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
President's Message
Dear Shareholder:
I am pleased to present the Semi-Annual Report to Shareholders of the Wachovia
Money Market Funds--Investment Shares, for the six-month period from December 1,
1998 through May 31, 1999. This report includes a listing of each fund's
holdings and complete financial information.*
Each Wachovia Money Market Fund continued to provide investors with daily income
on their accessible cash, while maintaining a stable $1.00 share value.** The
fund-by-fund highlights are as follows:
Wachovia Money Market Fund
The fund's portfolio of high-quality money market securities provided
shareholders with dividends totaling $0.02 per share, while maintaining a stable
share value of $1.00.** Assets in the fund's Investment Shares totaled $547.1
million at the end of the reporting period.
Wachovia Tax-Free Money Market Fund
The fund's portfolio of tax-free money market securities were invested among
securities issued by municipalities across the U.S. The fund provided
shareholders with federally tax-free*** dividends totaling $0.01 per share,
while maintaining a stable share value of $1.00.** Assets in the fund's
Investment Shares totaled $165.4 million at the end of the reporting period.
Wachovia U. S. Treasury Money Market Fund
The fund's portfolio of U.S. Treasury money market securities paid dividends
totaling $0.02 per share, while maintaining a stable share value of $1.00.**
Assets in the fund's Investment Shares totaled $186.6 million at the end of the
reporting period.
Thank you for choosing the Wachovia Money Market Funds to keep your invested
cash working and accessible--every day.
Sincerely,
[LOGO]
John W. McGonigle
President
July 15, 1999
* The composition and holdings of the funds are subject to change. Past
performance is no guarantee of future results.
** An investment in money market funds is neither insured nor guaranteed by the
Federal Deposit Insurance Corporation or any other government agency.
Although money market funds seek to preserve the value of your investment at
$1.00 per share, it is possible to lose money by investing in the funds.
*** Income may be subject to the federal alternative minimum tax and state and
local taxes.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Principal
Amount Value
- -----------------------------------------------------------------------------
<C> <S> <C>
(1) Bank Notes--5.7%
Banking & Finance--5.7%
$40,000,000 First National Bank of Chicago, 4.910%-5.020%,
6/2/1999-11/18/1999 $ 40,000,007
10,000,000 LaSalle National Bank, Chicago, 5.130%, 4/25/2000 9,996,528
------------
Total Bank Notes 49,996,535
------------
(1) Time Deposit--4.0%
Banking--4.0%
35,000,000 Citibank, Toronto, 4.900%-4.950%, 8/19/1999-
10/7/1999 35,000,000
------------
(1) Certificates of Deposit--32.3%
10,000,000 ABN AMRO Bank NV, Amsterdam, 4.905%, 10/12/1999 10,001,189
30,000,000 Barclays Bank PLC, London, 4.940%, 9/15/1999 30,000,861 40,000,000
CIBC Bank, New York, Yankee CD, 4.830%-5.710%,
6/17/1999-6/21/1999 39,999,475
20,000,000 Deutsche Bank, AG, 4.860%, 8/25/1999 20,000,000
15,000,000 Deutsche Bank, AG, 5.030%, 1/12/2000 15,000,901
25,000,000 Morgan Guaranty Trust Co., London, 4.870%,
7/16/1999 25,000,000
10,000,000 National Westminster Bank, PLC, London, 5.030%,
1/10/2000 9,997,054
35,000,000 NationsBank, 4.890%-5.000%, 9/15/1999-9/23/1999 35,000,000
30,000,000 Rabobank Nederland, 4.920%, 7/14/1999 30,000,000
25,000,000 Toronto Dominion Holdings (USA), Inc., 4.990%,
1/6/2000 24,995,659
20,000,000 UBS AG, 4.980%, 11/15/1999 20,000,905
15,000,000 Union Bank of Switzerland, Zurich, 5.750%,
8/17/1999 14,998,331
10,000,000 Westdeutsche Landesbank Girozentrale, 5.180%,
1/19/2000 10,008,001
------------
Total Certificates of Deposit 285,002,376
------------
(1) Commercial Paper--21.5%
Chemical & Allied Products--1.7%
15,000,000 Du Pont (E.I.) de Nemours & Co., 4.810%, 7/7/1999 14,927,850
------------
Consumer Non-Durables--2.8%
25,000,000 Coca-Cola Co., 4.800%, 6/23/1999 24,926,667
------------
Finance--5.1%
20,000,000 BellSouth Capital Funding Corp., 4.820%, 8/4/1999 19,828,622
25,000,000 CIT Group, Inc., 4.800%, 7/14/1999 24,856,667
------------
Total 44,685,289
------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
(1) Commercial Paper--continued
Finance-Automotive--1.1%
$10,000,000 Ford Motor Credit Corp., 4.810%, 8/10/1999 $ 9,906,472
------------
Finance-Commercial--10.8%
15,000,000 General Electric Capital Services Corp., 4.840%,
8/10/1999 14,858,833
20,000,000 General Electric Capital Services Corp., 4.880%,
6/9/1999 19,978,311
35,000,000 AI Credit Corp., 4.800%, 7/1/1999 34,860,000
25,000,000 Associates Corp. of North America, 4.879%,
6/16/1999 24,949,948
------------
Total 94,647,092
------------
Total Commercial Paper 189,093,370
------------
(1) Government Agencies--4.3%
Federal Home Loan Bank System--2.2%
20,000,000 4.470%, Discount Note, 10/29/1999 19,627,500
------------
Federal National Mortgage Association--2.2%
20,000,000 4.490%, Discount Note, 10/28/1999 19,628,328
------------
Total Government Agencies 39,255,828
------------
(2) Notes-Variable--24.3%
Banking--2.8%
25,000,000 PNC Bank, NA, 4.801%, 6/1/1999 24,996,294
------------
Banking & Finance--14.1%
30,000,000 Amsouth Bank, 4.823%, 6/15/1999 29,992,918
20,000,000 First Union National Bank, Charlotte, N.C., 4.910%,
6/1/1999 20,000,000
15,000,000 First Union National Bank, Charlotte, N.C., 4.930%,
7/21/1999 15,000,000
25,000,000 Mellon Bank, NA, Pittsburgh, 4.900%, 6/18/1999 24,997,368
25,000,000 SouthTrust Bank, NA, 4.820%, 6/7/1999 24,996,616
10,000,000 SouthTrust Bank, NA, 4.800%, 6/14/1999 9,995,756
------------
Total 124,982,658
------------
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
(2) Notes-Variable--continued
Chemical & Allied Products--1.7%
$15,000,000 Texaco Capital, Inc., 4.845%, 8/3/1999 $ 14,987,740
------------
Finance-Commercial--2.3%
20,000,000 General Electric Capital Corp., 4.978%, 8/23/1999 20,000,000
------------
Student Loan Marketing Association--3.4%
10,000,000 5.201%, 7/15/1999 10,000,000
20,000,000 5.271%, 2/11/2000 19,994,822
------------
Total 29,994,822
------------
Total Notes-Variable 214,961,514
------------
(3) Repurchase Agreements--7.5%
33,281,628 First Boston, Inc., 4.850%, dated 5/28/1999, due
6/1/1999 33,281,628
7,500,000 Merrill Lynch, Pierce, Fenner and Smith, 4.790%,
dated 5/28/1999, due 6/1/1999 7,500,000
25,400,000 Morgan Stanley Group, Inc., 4.890%, dated
5/28/1999, due 6/1/1999 25,400,000
------------
Total Repurchase Agreements 66,181,628
------------
Total Investments (at amortized cost and values)(4) $879,491,251
------------
</TABLE>
(1) Each issue shows the rate of discount at the time of purchase for discount
issues, or the coupon for interest bearing issues.
(2) Current rate and next reset date shown.
(3) The repurchase agreements are fully collateralized by U.S. Treasury and/or
agency obligations based on market prices at the date of the portfolio.
(4) Also represents cost for federal tax purposes.
Note: The categories of investments are shown as a percentage of net assets
($881,740,692) at May 31, 1999.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
Statement of Assets and Liabilities
May 31, 1999 (unaudited)
<TABLE>
<S> <C> <C>
Assets:
Total investments in securities, at
amortized cost and value $879,491,251
Income receivable 5,977,620
Receivable for shares sold 1,002
------------
Total assets 885,469,873
Liabilities:
Payable for shares redeemed $ 501
Income distribution payable 3,259,902
Accrued expenses 468,778
----------
Total liabilities 3,729,181
------------
Net Assets for 881,740,692 shares
outstanding $881,740,692
------------
Net Asset Value, Offering Price and
Redemption Proceeds Per Share:
Institutional Shares:
$334,547,537/334,547,537 shares
outstanding $1.00
------------
Investment Shares:
$547,193,155/547,193,155 shares
outstanding $1.00
------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
Statement of Operations
Six Months Ended May 31, 1999 (unaudited)
<TABLE>
<S> <C> <C>
Investment Income:
Interest $20,254,809
Expenses:
Investment advisory fee $2,024,503
Administrative personnel and services fee 360,727
Custodian fees 59,189
Transfer and dividend disbursing agent fees and
expenses 2,246
Directors'/Trustees' fees 5,745
Auditing fees 7,743
Legal fees 1,657
Portfolio accounting fees 157
Distribution services fee--Investment Shares 1,056,972
Share registration costs 25,474
Printing and postage 14,598
Insurance premiums 2,743
Miscellaneous 3,827
----------
Total expenses 3,565,581
Waiver of investment advisory fee (971,117)
----------
Net expenses 2,594,464
-----------
Net investment income $17,660,345
-----------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Six Months Ended
(unaudited) Year Ended
May 31, 1999 November 30, 1998
- ------------------------------------------------------------------------------
<S> <C> <C>
Increase (Decrease) in Net Assets:
Operations--
Net investment income $ 17,660,345 $ 28,120,423
------------- -------------
Distributions to Shareholders--
Distributions from net investment income
Institutional Shares (6,497,531) (9,265,013)
Investment Shares (11,162,814) (18,855,410)
------------- -------------
Change in net assets resulting from
distributions to
shareholders (17,660,345) (28,120,423)
------------- -------------
Share Transactions--
Proceeds from sale of shares 798,663,247 958,837,233
Net asset value of shares issued to
shareholders in payment of distributions
declared 294,005 568,444
Cost of shares redeemed (580,626,355) (773,913,879)
------------- -------------
Change in net assets resulting from share
transactions 218,330,897 185,491,798
------------- -------------
Change in net assets 218,330,897 185,491,798
Net Assets:
Beginning of period 663,409,795 477,917,997
------------- -------------
End of period $ 881,740,692 $ 663,409,795
------------- -------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Fund
Financial Highlights--Institutional Shares
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months
Ended
(unaudited) Year Ended November 30,
May 31, ------------------------------------------------
1999 1998 1997 1996 1995 1994
- ------------------------------------------------------------------------------------------
<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
Income from investment
operations
Net investment income 0.02 0.05 0.05 0.05 0.06 0.04
Less distributions
Distributions from net
investment income (0.02) (0.05) (0.05) (0.05) (0.06) (0.04)
-------- -------- -------- -------- -------- --------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- --------
Total return (1) 2.32% 5.33% 5.37% 5.25% 5.75% 3.77%
Ratios to average net
assets
Expense (2) 0.62%(3) 0.64% 0.66% 0.69% 0.72% 0.78%
Net investment income
(2) 4.38%(3) 4.94% 4.96% 4.82% 5.27% 3.34%
Expenses (after waivers) 0.38%(3) 0.38% 0.38% 0.37% 0.38% 0.38%
Net investment income
(after waivers) 4.62%(3) 5.20% 5.24% 5.14% 5.61% 3.74%
Supplemental Data
Net assets, end of
period (000 omitted) $334,548 $181,282 $157,438 $135,748 $126,042 $129,233
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(2) As a result of contractual obligations, certain fees were waived. If such
waivers had not occurred, the ratios would have been as indicated.
(3) Computed on an annualized basis.
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Fund
Financial Highlights--Investment Shares
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months
Ended
(unaudited) Year Ended November 30,
May 31, -----------------------------------------------
1999 1998 1997 1996 1995 1994
- ----------------------------------------------------------------------------------------
<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
Income from investment
operations
Net investment income 0.02 0.05 0.05 0.05 0.05 0.03
Less distributions
Distributions from net
investment income (0.02) (0.05) (0.05) (0.05) (0.05) (0.03)
-------- -------- -------- -------- -------- -------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- -------
Total return (1) 2.12% 4.92% 4.95% 4.83% 5.40% 3.46%
Ratios to average net
assets
Expense (2) 1.02%(3) 1.04% 1.06% 1.09% 1.12% 1.18%
Net investment
income (2) 3.98%(3) 4.54% 4.57% 4.42% 4.87% 2.94%
Expenses (after
waivers) 0.78%(3) 0.78% 0.78% 0.77% 0.72% 0.68%
Net investment
income (after waivers) 4.22%(3) 4.80% 4.85% 4.74% 5.27% 3.44%
Supplemental data
Net assets, end of
period (000 omitted) $547,193 $482,128 $320,480 $230,263 $165,636 $56,105
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(2) As a result of contractual obligations, certain fees were waived. If such
waivers had not occurred, the ratios would have been as indicated.
(3) Computed on an annualized basis.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--93.1%
Alabama--9.0%
$ 2,200,000 Alabama HFA, Refunding Revenue Bonds (Series B)
Weekly VRDNs $ 2,200,000
1,000,000 Birmingham, AL, (Series A) Weekly VRDNs (First
Alabama Bank, Memphis LOC) 1,000,000
3,320,000 Birmingham, AL, GO (Series 1992A) Weekly VRDNs
(Regions Bank, Alabama LOC) 3,320,000
20,700,000 Daphne-Villa Mercy, AL Special Care Facilities,
Health, Hospital, Nursing Home Improvement Revenue
Bonds Weekly VRDNs (Mercy Medical Center)/(Amsouth
Bancorporation LOC) 20,700,000
10,300,000 The Board of Trustees of the University of Alabama,
University & College Improvements (Series B) Weekly
VRDNs 10,300,000
375,000 Tuscaloosa County, AL Port Authority, (Series
1989A) Weekly
VRDNs (Capstone Hotel Ltd.)/(SouthTrust Bank of
Alabama, Birmingham LOC) 375,000
------------
Total 37,895,000
------------
Alaska--4.7%
20,000,000 Alaska State Housing Finance Corp., Revenue Bonds
(Series 1991C) Weekly VRDNs (Swiss Bank Capital
Markets LOC) 20,000,000
------------
Arizona--2.3%
9,500,000 Arizona School District, (Series A), 4.10% TANs,
7/30/1999 9,510,241
100,000 Phoenix, AZ, GO UT Bonds Daily VRDNs 100,000
------------
Total 9,610,241
------------
Delaware--1.1%
4,455,000 Delaware State, GO UT Public Improvement Refunding Bonds (Series
A), 4.50%, 2/1/2000 4,501,168
------------
Florida--8.1%
5,000,000 Alachua County, FL Health Facilities Authority, Health Facilities
Revenue Bonds (Series 1996B) Weekly VRDNs (Shands Teaching Hospital
and Clinics, Inc.)/(MBIA INS)/(SunTrust Bank, Central Florida
LIQ) 5,001,925
5,000,000 Broward County, FL HFA, Revenue Bonds Weekly VRDNs
(Welleby Apartments) 5,000,000
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
Florida--continued
$ 6,600,000 Collier County, FL HFA, Multi-family Revenue Bonds
(Series 1985) Weekly VRDNs (River Reach Project) $ 6,600,000
1,600,000 Escambia County, FL Health Facilities Authority,
IDRB (Series A) Monthly VRDNs (Florida Convalescent
Centers, Inc.)/(Toronto-Dominion Bank LOC) 1,600,000
2,830,000 Eustis Health Facilities Authority, FL, (Series
1985) Weekly VRDNs (Waterman Medical
Center)/(Paribas, Paris LOC) 2,830,000
600,000 Polk County, FL IDA, Refunding Revenue Bonds
Monthly VRDNs (Florida Convalescent Centers,
Inc.)/(Toronto-Dominion Bank LOC) 600,000
1,000,000 Polk County, FL IDA, Refunding Revenue Bonds Weekly
VRDNs (IMC Fertilizer, Inc. Project)/(Rabobank
Nederland, Utrecht LOC) 1,000,000
4,600,000 Southeast Volusia Hospital District FL, Revenue
Bonds (Series 1995) Weekly VRDNs (Bert Fish Medical
Center (FL))/(SouthTrust Bank of Alabama,
Birmingham LOC) 4,600,000
7,000,000 St. Lucie County, FL PCR, 2.75% CP, Mandatory
Tender 6/10/1999 7,000,000
------------
Total 34,231,925
------------
Georgia--6.0%
8,600,000 De Kalb Private Hospital Authority, GA, Revenue
Anticipation Certificates (Series 1994B) Weekly
VRDNs (Egleston Children's Hospital at Emory
University, Inc.)/(SunTrust Bank, Atlanta LOC) 8,600,000
5,000,000 De Kalb Private Hospital Authority, GA, Revenue
Anticipation Certificates (Series 1995B) Weekly
VRDNs (Egleston Children's Hospital at Emory
University, Inc.)/(SunTrust Bank, Atlanta LOC) 4,999,999
2,500,000 Georgia State, GO UT (Series E), 6.70% Bonds,
7/1/1999 2,506,238
2,900,000 Lowndes County, GA Residential Care Facilities for
the Elderly Authority Weekly VRDNs (South Georgia
Health Alliance Project) 2,900,000
845,000 Macon-Bibb County, GA Urban Development Authority,
Refunding Revenue Bonds (Series 1995) Weekly VRDNs
(Macon Hotel Investors Project)/(NBD Bank, Michigan
LOC) 845,000
500,000 Monroe County, GA Development Authority IDRB,
Refunding
Revenue Bonds Weekly VRDNs (Forsyth Inns,
Inc.)/(NBD Bank,
Michigan LOC) 500,000
5,120,000 Richmond County, GA Board of Education, GO UT
Refunding
Revenue Bonds, 4.50%, 3/1/2000 5,179,651
------------
Total 25,530,888
------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
Illinois--9.3%
$ 5,000,000 Chicago, IL, 2.85% TOBs (Morgan Guaranty Trust Co.,
New York LOC), Mandatory Tender 10/28/1999 $ 5,000,000
11,900,000 Illinois Development Finance Authority Weekly VRDNs 11,900,000
740,000 Illinois Development Finance Authority, Revenue
Bonds Weekly VRDNs (Aurora Central Catholic High
School) 740,000
1,000,000 Illinois Development Finance Authority, Revenue
Bonds Weekly VRDNs (Lake Forest Academy)/(Northern
Trust Corp. LOC) 1,000,000
1,155,000 Illinois Development Finance Authority, Revenue
Bonds Weekly VRDNs (Little City Foundation) 1,155,000
3,800,000 Illinois Development Finance Authority, Revenue
Bonds Weekly VRDNs (St. Ignatius College) 3,800,000
1,525,000 Illinois Development Finance Authority, Revenue
Bonds Weekly VRDNs (St. Paul's House)/(LaSalle
National Bank, Chicago LOC) 1,525,000
4,500,000 Illinois Development Finance Authority, (Series A)
Weekly VRDNs (Presbyterian Home Lake)/(LaSalle
National Bank, Chicago LOC) 4,500,000
8,600,000 Jackson-Union Counties, IL Regional Port District
Facilities Weekly VRDNs (Enron Transportation
Services) 8,600,000
1,000,000 Orland Hills, IL, Multi-family Mortgage Revenue
Bonds Weekly VRDNs (LaSalle National Corp. LOC) 1,000,000
------------
Total 39,220,000
------------
Iowa--1.2%
5,000,000 Iowa School Corporations, (Series B), 3.50% Bonds,
1/28/2000 (FSA INS) 5,016,969
------------
Kentucky--0.9%
3,100,000 Clark County, KY Pollution Control, (Series J-2)
VRDNs (East Kentucky Power Cooperative,
Inc.)/(National Rural Utilities Cooperative Finance
Corp. GTD) 3,100,000
600,000 Georgetown, KY Educational Institution, Revenue
Bonds Weekly VRDNs (Georgetown College) 600,000
------------
Total 3,700,000
------------
Louisiana--1.1%
1,700,000 Calcasieu Parish, LA, IDB, PCR Bonds Weekly VRDNs
(Citgo Petroleum Corp.) 1,700,000
2,800,000 Lake Charles, LA Harbor & Terminal District,
Revenue Bonds Weekly VRDNs (Citgo Petroleum Corp.) 2,800,000
------------
Total 4,500,000
------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
Massachusetts--6.3%
$20,000,000 Commonwealth of Massachusetts, (Series B) Weekly
VRDNs (Toronto-Dominion Bank LOC) $ 20,000,000
100,000 Massachusetts HEFA, (Series P-1) Weekly VRDNs
(Partners Healthcare Systems)/(FSA SA) 100,000
6,500,000 Massachusetts Municipal Wholesale Electric Co.,
Power Supply System Revenue Bonds (Series 1994C)
Weekly VRDNs (Canadian Imperial Bank of Commerce
LOC) 6,500,000
------------
Total 26,600,000
------------
Mississippi--0.5%
2,340,000 Jackson County, MS, 2.90% TOBs, Optional Tender
8/1/1999 (Chevron Corp. GTD) 2,340,000
------------
Missouri--0.4%
1,800,000 Kansas City, MO IDA, IDRB Weekly VRDNs (Mid-
American Health Services) 1,800,000
------------
New Mexico--1.7%
7,000,000 New Mexico State, 4.25% TRANs, 6/30/1999 7,003,490
------------
New York--8.1%
6,510,000 Monroe County, NY, GO UT Refunding Bonds, 5.00%,
3/1/2000 6,609,694
100,000 New York City, NY, (Subseries B-4) Daily VRDNs (MBIA INS)/(National
Westminster Bank, PLC, London LIQ) 100,000
4,225,000 New York City, NY, GO UT Bonds Daily VRDNs 4,225,000
11,400,000 New York City, NY, GO UT Refunding Bonds (Subseries
E-3) Daily VRDNs 11,400,000
11,700,000 New York City, NY, (Subseries E-2) Daily VRDNs
(Morgan Guaranty Trust Co., New York LOC) 11,700,000
------------
Total 34,034,694
------------
North Carolina--3.1%
1,500,000 Alamance County, NC Industrial Facilities &
Pollution Control Financing Authority, Revenue
Bonds Weekly VRDNs (SCI Systems, Inc.) 1,500,000
2,000,000 North Carolina Educational Facilities Finance
Agency Weekly VRDNs (Gardner Webb
University)/(First Union National Bank, Charlotte,
NC LOC) 2,000,000
9,700,000 North Carolina Medical Care Commission, Revenue
Bonds (Series A) Weekly VRDNs (Pooled Financing
Program) 9,700,000
------------
Total 13,200,000
------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
Ohio--4.2%
$ 945,000 Centerville, OH, Health Care Revenue Bonds Weekly
VRDNs (Bethany Lutheran Village) $ 945,000
1,900,000 Columbus, OH, GO UT (Series 1) Weekly VRDNs 1,900,000
10,000,000 Lorain County, OH, (Series A), 2.75% CP, Mandatory
Tender 6/10/1999 10,000,000
5,000,000 Lorain County, OH, (Series A), 3.30% CP, Mandatory
Tender 6/3/1999 5,000,000
------------
Total 17,845,000
------------
Oklahoma--1.0%
4,300,000 Tulsa County, OK ISD Number 001, School
Improvements, 5.00% Bonds, 2/1/2000 4,357,424
------------
Oregon--4.6%
10,000,000 Multnomah County, OR, Cash Flow Management Revenue
Notes, 4.50% TRANs, 6/30/1999 10,007,286
4,400,000 Oregon State, Veteran's Welfare Bonds (Series 73-E)
Weekly VRDNs (Morgan Guaranty Trust Co., New York
LOC) 4,400,000
5,000,000 Oregon State, Veteran's Welfare Bonds (Series 73-F)
Weekly VRDNs (Morgan Guaranty Trust Co., New York
LOC) 5,000,000
------------
Total 19,407,286
------------
Pennsylvania--1.9%
4,900,000 Allegheny County, PA IDA, Revenue Bonds (Series A)
Weekly VRDNs (United Jewish Federation of Greater
Pittsburgh VRDB)/(PNC Bank, NA LOC) 4,900,000
3,000,000 Philadelphia, PA School District, (Series B), 4.25%
TRANs (PNC Bank, NA LOC), 6/30/1999 3,000,000
------------
Total 7,900,000
------------
South Carolina--0.9%
4,000,000 South Carolina State, GO UT (Series B), 5.75%
Bonds, 8/1/1999 4,014,276
------------
Tennessee--5.4%
4,250,000 Clarksville, TN Public Building Authority,
Adjustable Rate Pooled Financing Revenue Bonds
(Series 1997) Weekly VRDNs (Tennessee Municipal
Bond Fund)/(Nationsbank, NA, Charlotte LOC) 4,250,000
1,300,000 Clarksville, TN Public Building Authority, Public
Improvement Revenue Bonds Weekly VRDNs 1,300,000
7,395,000 Knox County, TN, GO UT Refunding Bonds, 4.50%,
3/1/2000 7,481,156
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
Tennessee--continued
$ 3,000,000 Metropolitan Government Nashville & Davidson
County, TN IDB, Multi-family Housing Revenue Bonds
(Series B) Weekly VRDNs (Arbor Crest LP)/(Chase
Manhattan Bank N.A., New York and LaSalle National
Corp. LOCs) $ 3,000,000
4,600,000 Metropolitan Nashville Tennessee AA, (Series 1993) Weekly VRDNs
(FGIC INS)/(Societe Generale, Paris LIQ)/(Societe Generale, Paris
LOC) 4,600,000
2,000,000 Montgomery County, TN Public Building Authority
Weekly VRDNs 2,000,000
------------
Total 22,631,156
------------
Texas--6.0%
10,600,000 Lower Neches Valley, TX, Refunding Revenue Bonds,
3.45% TOBs (Chevron U.S.A., Inc.), Optional Tender
8/16/1999 10,600,000
3,900,000 Richardson, TX ISD, (Series A) Weekly VRDNs (PSFG
GTD)/(Union Bank of Switzerland, Zurich SA) 3,900,000
10,500,000 Texas State, GO UT, 7.125% Bonds, 4/1/2000
(Callable @102) 11,031,451
------------
Total 25,531,451
------------
Virginia--1.5%
300,000 Roanoke, VA IDA, (Series B) Daily VRDNs (Carillion
Health System) 300,000
6,190,000 Virginia College Building Authority, University and
College Improvement Revenue Bonds, 5.00%, 2/1/2000 6,274,494
------------
Total 6,574,494
------------
Washington--2.4%
10,000,000 Port Anacortes, WA Industrial Development Corp.
VRDNs (Texaco, Inc.) 10,000,000
100,000 Washington Health Care Facilities Authority,
Variable Rate Demand Revenue Bonds (Series 1997B)
Daily VRDNs (Virginia Mason Medical Center)/(MBIA
INS)/(Credit Suisse First Boston LIQ) 99,998
------------
Total 10,099,998
------------
West Virginia--1.4%
6,000,000 West Virginia State Hospital Finance Authority,
(Series A) Weekly VRDNs (Oak Hill, WV)/(First
National Bank of Chicago COL) 6,000,000
------------
Total Short-Term Municipals 393,545,460
------------
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Shares Value
- ------------------------------------------------------------------------------
<C> <S> <C>
Open-End Investment Companies--6.5%
76,057 AIM Global Management Short Term Investments Money
Market Fund $ 76,057
7,532,830 Dreyfus Tax Exempt Money Market Fund 7,532,830
904,487 Federated Investors Tax-Free Obligations Fund 904,487
18,778,173 Fidelity Tax Exempt Money Market Fund 18,778,174
------------
Total Open-End Investment Companies 27,291,548
------------
Total Investments, at amortized cost and value (1) $420,837,008
------------
</TABLE>
(1) Also represents cost for federal tax purposes.
Note: The categories of investments are shown as a percentage of net assets
($422,417,507) at May 31, 1999.
The following acronyms are used throughout this portfolio:
COL--Collateralized LIQ--Liquidity Agreement
CP--Commercial Paper LOCs--Letter(s) of Credit
FGIC--Financial Guaranty Insurance Company MBIA--Municipal Bond Investors
FSA--Financial Security Assurance Assurance
GO--General Obligation PCR--Pollution Control Revenue
GTD--Guaranteed PSFG--Permanent School Fund
Guarantee
HEFA--Health and Education
Facilities Authority
HFA--Housing Finance Authority SA--Support Agreement
IDA--Industrial Development Authority TANs--Tax Anticipation Notes
IDB--Industrial Development Bond TOBs--Tender Option Bonds
IDRB--Industrial Development Revenue Bond TRANs--Tax and Revenue Anticipation
INS--Insured Notes
ISD--Independent School District UT--Unlimited Tax
VRDB--Variable Rate Demand Bond
VRDNs--Variable Rate Demand Notes
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
Statements of Assets and Liabilities
May 31, 1999 (unaudited)
<TABLE>
<S> <C> <C>
Assets:
Total investments in securities, at
amortized cost and value $420,837,008
Income receivable 1,759,126
Receivable for shares sold 19,806
Receivable for investments sold 1,237,150
------------
Total assets 423,853,090
Liabilities:
Income distribution payable $1,108,467
Accrued expenses 327,116
----------
Total liabilities 1,435,583
------------
Net Assets for 422,417,507 shares
outstanding $422,417,507
------------
Net Asset Value, Offering Price and
Redemption Proceeds Per Share:
Institutional Shares:
$256,978,889/256,978,889 shares
outstanding $1.00
------------
Investment Shares:
$165,438,618/165,438,618 shares
outstanding $1.00
------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
Statement of Operations
Six Months Ended May 31, 1999 (unaudited)
<TABLE>
<S> <C> <C>
Investment Income:
Interest $6,659,240
Expenses:
Investment advisory
fee $1,058,302
Administrative
personnel and
services fee 188,633
Custodian fees 37,982
Transfer and
dividend disbursing
agent fees and
expenses 2,102
Directors'/Trustees'
fees 3,669
Auditing fees 7,879
Legal fees 2,779
Portfolio accounting
fees 404
Distribution
services fee--
Investment Shares 292,256
Share registration
costs 17,049
Printing and postage 12,567
Insurance premiums 2,195
Miscellaneous 8,059
----------
Total expenses 1,633,876
Waiver of investment
advisory fee (839,381)
----------
Net expenses 794,495
----------
Net investment income $5,864,745
----------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Six Months Ended
(unaudited) Year Ended
May 31, 1999 November 30, 1998
- ------------------------------------------------------------------------------
<S> <C> <C>
Increase (Decrease) in Net Assets:
Operations--
Net investment income $ 5,864,745 $ 11,680,208
------------- -------------
Distributions to Shareholders--
Distributions from net investment income
Institutional Shares (4,026,276) (8,367,231)
Investment Shares (1,838,469) (3,312,977)
------------- -------------
Change in net assets resulting from
distributions
to shareholders (5,864,745) (11,680,208)
------------- -------------
Share Transactions--
Proceeds from sale of shares 375,503,471 743,274,021
Cost of shares redeemed (361,619,573) (603,065,021)
------------- -------------
Change in net assets resulting from share
transactions 13,883,898 140,209,000
------------- -------------
Change in net assets 13,883,898 140,209,000
Net Assets:
Beginning of period 408,533,609 268,324,609
------------- -------------
End of period $ 422,417,507 $ 408,533,609
------------- -------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
Financial Highlights--Institutional Shares
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months
Ended
(unaudited) Year Ended November 30,
May 31, ----------------------------------------------
1999 1998 1997 1996 1995 1994
- ---------------------------------------------------------------------------------------
<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
Income from investment
operations
Net investment income 0.01 0.03 0.03 0.03 0.04 0.02
Less distributions
Distributions from net
investment income (0.01) (0.03) (0.03) (0.03) (0.04) (0.02)
-------- -------- -------- -------- ------- -------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- ------- -------
Total return (1) 1.47% 3.29% 3.41% 3.24% 3.59% 2.42%
Ratios to average net
assets
Expense (2) 0.64%(3) 0.66% 0.69% 0.72% 0.78% 0.83%
Net investment
income (2) 2.51%(3) 2.82% 2.89% 2.79% 3.09% 1.96%
Expenses (after
waivers) 0.24%(3) 0.24% 0.24% 0.29% 0.32% 0.38%
Net investment
income (after waivers) 2.91%(3) 3.24% 3.34% 3.22% 3.55% 2.41%
Supplemental data
Net assets, end of
period (000 omitted) $256,979 $275,323 $182,473 $118,877 $80,274 $93,867
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(2) As a result of contractual obligations, certain fees were waived. If such
waivers had not occurred, the ratios would have been as indicated.
(3) Computed on an annualized basis.
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
Financial Highlights--Investment Shares
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months
Ended
(unaudited) Year Ended November 30,
May 31, ---------------------------------------------
1999 1998 1997 1996 1995 1994
- --------------------------------------------------------------------------------------
<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
Income from investment
operations
Net investment income 0.01 0.03 0.03 0.03 0.03 0.02
Less distributions
Distributions from net
investment income (0.01) (0.03) (0.03) (0.03) (0.03) (0.02)
-------- -------- ------- ------- ------- -------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- ------- ------- ------- -------
Total return (1) 1.27% 2.88% 2.99% 2.83% 3.25% 2.11%
Ratios to average net
assets
Expenses (2) 1.04%(3) 1.05% 1.09% 1.12% 1.18% 1.23%
Net investment
income (2) 2.11%(3) 2.42% 2.48% 2.41% 2.67% 1.56%
Expense (after waivers) 0.64%(3) 0.64% 0.64% 0.69% 0.66% 0.68%
Net investment income
(after waivers) 2.51%(3) 2.83% 2.93% 2.84% 3.19% 2.11%
Supplemental data
Net assets, end of
period (000 omitted) $165,439 $133,211 $85,852 $74,922 $55,733 $42,820
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(2) As a result of contractual obligations, certain fees were waived. If such
waivers had not occurred, the ratios would have been as indicated.
(3) Computed on an annualized basis.
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia U.S. Treasury Money Market Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
U.S. Government Obligations--42.8%
U.S. Treasury Bills--5.6%
$ 35,000,000 7/29/1999-9/23/1999 $ 34,623,798
------------
U.S. Treasury Notes--37.2%
230,000,000 5.375%-6.875%, 5/31/1999-1/31/2000 230,803,564
------------
Total U.S. Government Obligations 265,427,362
------------
(1) Repurchase Agreements--57.0%
28,139,297 Goldman Sachs Group, LP, 4.500%, dated 5/28/1999,
due
6/1/1999 28,139,297
28,240,000 First Boston, 4.850%, dated 5/28/1999, due
6/1/1999 28,240,000
148,340,000 Merrill Lynch, Pierce, Fenner and Smith, 4.790%,
dated
5/28/1999, due 6/1/1999 148,340,000
148,340,000 Morgan Stanley Group, Inc., 4.800%, dated
5/28/1999, due
6/1/1999 148,340,000
------------
Total Repurchase Agreements 353,059,297
------------
Total Investments, at amortized cost and value (2) $618,486,659
------------
</TABLE>
(1) The repurchase agreements are fully collateralized by U.S. Treasury and/or
agency obligations based on market prices at the date of the portfolio.
(2) Also represents cost for federal tax purposes.
Note: The categories of investments are shown as a percentage of net assets
($619,701,798) at May 31, 1999.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia U.S. Treasury Money Market Fund
Statement of Assets and Liabilities
May 31, 1999 (unaudited)
<TABLE>
<S> <C> <C>
Assets:
Investments in repurchase agreements $353,059,297
Investments in securities 265,427,362
------------
Total investments in securities, at amortized
cost and value $618,486,659
Income receivable 4,011,533
------------
Total assets 622,498,192
Liabilities:
Income distribution payable 2,637,198
Accrued expenses 159,196
------------
Total liabilities 2,796,394
------------
Net Assets for 619,701,798 shares outstanding $619,701,798
------------
Net Asset Value, Offering Price and Redemption
Proceeds Per Share:
Institutional Shares:
$433,009,775/433,009,775 shares outstanding $1.00
------------
Investment Shares:
$186,692,023/186,692,023 shares outstanding $1.00
------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia U.S. Treasury Money Market Fund
Statement of Operations
Six Months Ended May 31, 1999 (unaudited)
<TABLE>
<S> <C> <C>
Investment Income:
Interest $16,242,803
Expenses:
Investment advisory fee $ 1,686,979
Administrative personnel and services fee 300,985
Custodian fees 52,445
Transfer and dividend disbursing agent fees and
expenses 2,291
Directors'/Trustees' fees 8,228
Auditing fees 7,427
Legal fees 571
Portfolio accounting fees 213
Distribution services fee--Investment Shares 384,200
Share registration costs 22,217
Printing and postage 12,858
Insurance premiums 3,429
Miscellaneous 4,976
-----------
Total expenses 2,486,819
Waiver of investment advisory fee (1,292,699)
-----------
Net expenses 1,194,120
-----------
Net investment income $15,048,683
-----------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia U.S. Treasury Money Market Fund
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Six Months Ended
(unaudited) Year Ended
May 31, 1999 November 30, 1998
- ------------------------------------------------------------------------------
<S> <C> <C>
Increase (Decrease) in Net Assets:
Operations--
Net investment income $ 15,048,683 $ 34,194,612
------------- ---------------
Distributions to Shareholders--
Distributions from net investment income
Institutional Shares (11,014,099) (27,082,585)
Investment Shares (4,034,584) (7,112,027)
------------- ---------------
Change in net assets resulting from
distributions to shareholders (15,048,683) (34,194,612)
------------- ---------------
Share Transactions--
Proceeds from sale of shares 709,853,610 1,496,501,247
Net asset value of shares issued to
shareholders in payment of distributions
declared 15,523 27,832
Cost of shares redeemed (755,476,721) (1,459,037,222)
------------- ---------------
Change in net assets resulting from share
transactions (45,607,588) 37,491,857
------------- ---------------
Change in net assets (45,607,588) 37,491,857
Net Assets:
Beginning of period 665,309,386 627,817,529
------------- ---------------
End of period $ 619,701,798 $ 665,309,386
------------- ---------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia U.S. Treasury Money Market Fund
Financial Highlights--Institutional Shares
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months
Ended
(unaudited) Year Ended November 30,
May 31, -----------------------------------------------
1999 1998 1997 1996 1995 1994
- ----------------------------------------------------------------------------------------
<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
Income from investment
operations
Net investment income 0.02 0.05 0.05 0.05 0.06 0.04
Less distributions
Distributions from net
investment income (0.02) (0.05) (0.05) (0.05) (0.06) (0.04)
-------- -------- -------- -------- -------- -------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- -------
Total return (1) 2.26% 5.25% 5.31% 5.18% 5.66% 3.70%
Ratios to average net
assets
Expenses (2) 0.62%(3) 0.64% 0.65% 0.69% 0.72% 0.87%
Net investment
income (2) 4.19%(3) 4.75% 4.79% 4.68% 5.14% 3.21%
Expenses
(after waivers) 0.24%(3) 0.24% 0.24% 0.30% 0.32% 0.36%
Net investment income
(after waivers) 4.57%(3) 5.15% 5.20% 5.07% 5.54% 3.72%
Supplemental data
Net assets, end of
period (000 omitted) $433,010 $466,538 $510,323 $302,306 $214,356 $87,531
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(2) As a result of contractual obligations, certain fees were waived. If such
waivers had not occurred, the ratios would have been as indicated.
(3) Computed on an annualized basis.
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia U.S. Treasury Money Market Fund
Financial Highlights--Investment Shares
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months
Ended
(unaudited) Year Ended November 30,
May 31, ----------------------------------------------
1999 1998 1997 1996 1995 1994
- ----------------------------------------------------------------------------------------
<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
Income from investment
operations
Net investment income 0.02 0.05 0.05 0.04 0.05 0.03
Less distributions
Distributions from net
investment income (0.02) (0.05) (0.05) (0.04) (0.05) (0.03)
-------- -------- -------- -------- ------- -------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- ------- -------
Total return (1) 2.06% 4.83% 4.89% 4.77% 5.30% 3.39%
Ratios to average net
assets
Expenses (2) 1.02%(3) 1.03% 1.05% 1.09% 1.12% 1.27%
Net investment
income (2) 3.79%(3) 4.34% 4.39% 4.29% 4.75% 2.81%
Expenses (after waivers) 0.64%(3) 0.63% 0.64% 0.70% 0.66% 0.66%
Net investment income
(after waivers) 4.17%(3) 4.74% 4.80% 4.68% 5.21% 3.42%
Supplemental data
Net assets, end of
period (000 omitted) $186,692 $198,771 $117,495 $104,336 $81,739 $46,396
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(2) As a result of contractual obligations, certain fees were waived. If such
waivers had not occurred, the ratios would have been as indicated.
(3) Computed on an annualized basis.
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Funds
Combined Notes to Financial Statements
May 31, 1999 (unaudited)
1. Organization
The Wachovia Funds (the "Trust") is registered under the Investment Company Act
of 1940, as amended (the "Act"), as an open-end, management investment company.
The Trust consists of fourteen portfolios. The following portfolios are included
herein (individually referred to as the "Fund", or collectively as the "Funds"):
<TABLE> <S> <C>
Portfolio Investment Objective
- ------------------------------------------------------------------------------
Wachovia Money Market Fund To provide current income consistent
("Money Market Fund") with stability of principal and
liquidity.
- ------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund To provide current income exempt from
("Tax-Free Fund") federal regular income tax consistent
with stability of principal and
liquidity.
- ------------------------------------------------------------------------------
Wachovia U.S. Treasury Money Market To provide current income consistent
Fund ("U.S. Treasury Fund") with stability of principal and
liquidity.
</TABLE>
The financial statements of the other portfolios are presented separately. The
assets of each portfolio are segregated and a shareholder's interest is limited
to the portfolio in which shares are held. The Funds offer two classes of
shares: Institutional Shares and Investment Shares. Investment Shares are
identical in all respects to Institutional Shares except that Investment Shares
are sold pursuant to a distribution plan (the "Plan") adopted in accordance with
Rule 12b-1 under the Act.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently
followed by the Funds in the preparation of their financial statements. These
policies are in conformity with generally accepted accounting principles.
Investment Valuations--The Funds' use of the amortized cost method to value
their portfolio securities is in accordance with Rule 2a-7 under the Act.
Investments in other open-end regulated investment companies are valued at net
asset value.
Repurchase Agreements--It is the policy of the Funds to require the custodian
bank to take possession, to have legally segregated in the Federal Reserve
Book Entry System, or to have segregated within the custodian bank's vault,
all securities held as collateral under repurchase agreement transactions.
Additionally, procedures have been established by the Funds to monitor, on a
daily basis, the market value of each repurchase agreement's collateral to
ensure that the value of collateral at least equals the repurchase price to be
paid under the repurchase agreement transaction.
The Funds will only enter into repurchase agreements with banks and other
recognized financial institutions, such as broker/dealers, which are deemed by
the Funds' adviser to be creditworthy pursuant to the guidelines and/or
standards reviewed or established by the Board of Trustees (the "Trustees").
Risks may arise from the potential inability of counterparties to honor the
terms of the repurchase agreement. Accordingly, the Funds could receive less
than the repurchase price on the sale of collateral securities.
Investment Income, Expenses and Distributions--Interest income and expenses
are accrued daily. Bond premium and discount, if applicable, are amortized as
required by the Internal Revenue Code, as amended (the "Code"). Distributions
to shareholders are recorded on the ex-dividend date.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Funds
Federal Taxes--It is the Funds' policy to comply with the provisions of the
Code applicable to regulated investment companies and to distribute to
shareholders each year substantially all of their income. Accordingly, no
provisions for federal tax are necessary.
When-Issued and Delayed Delivery Transactions--The Funds may engage in
when-issued or delayed delivery transactions. The Funds record when-issued
securities on the trade date and maintain security positions such that
sufficient liquid assets will be available to make payment for the securities
purchased. Securities purchased on a when-issued or delayed delivery basis are
marked to market daily and begin earning interest on the settlement date.
Use of Estimates--The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the amounts of assets, liabilities, expenses and
revenues reported in the financial statements. Actual results could differ
from those estimated.
Other--Investment transactions are accounted for on the trade date.
3. Shares of Beneficial Interest
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value) for each
class of shares. At May 31, 1999, capital paid-in aggregated $881,740,692,
$422,417,507 and $619,701,798 for Money Market Fund, Tax-Free Fund, and U.S.
Treasury Fund, respectively.
Transactions in shares were as follows:
<TABLE>
<CAPTION>
Money Market Fund Tax-Free Fund U.S. Treasury Fund
-------------------------- -------------------------- ----------------------------
Six Months Six Months Six Months
Ended Year Ended Ended Year Ended Ended Year Ended
May 31, November 30, May 31, November 30, May 31, November 30,
1999 1998 1999 1998 1999 1998
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Institutional Shares
- -----------------------
Shares sold 407,532,408 369,619,728 162,297,035 367,947,784 539,713,595 1,162,773,272
Shares redeemed (254,266,765) (345,776,210) (180,640,591) (275,098,274) (573,241,736) (1,206,558,183)
- ----------------------- ------------ ------------ ------------ ------------ ------------ --------------
Net change resulting
from Institutional
Shares transactions 153,265,643 23,843,518 (18,343,556) 92,849,510 (33,528,141) (43,784,911)
------------ ------------ ------------ ------------ ------------ --------------
Investment Shares
- -----------------------
Shares sold 391,130,839 589,217,508 213,206,436 375,326,237 170,140,015 333,727,978
Shares issued to
shareholders in payment
of distributions
declared 294,005 568,441 -- -- 15,523 27,829
Shares redeemed (326,359,590) (428,137,669) (180,978,982) (327,966,747) (182,234,985) (252,479,039)
- ----------------------- ------------ ------------ ------------ ------------ ------------ --------------
Net change resulting
from Investment Shares
transactions 65,065,254 161,648,280 32,227,454 47,359,490 (12,079,447) 81,276,768
------------ ------------ ------------ ------------ ------------ --------------
Net change resulting
from share transactions 218,330,897 185,491,798 13,883,898 140,209,000 (45,607,588) 37,491,857
------------ ------------ ------------ ------------ ------------ --------------
</TABLE>
4. Investment Advisory Fee and Other Transactions with Affiliates
Investment Advisory Fee--Wachovia Asset Management, the Funds' investment
adviser (the "Adviser"), receives for its services an annual investment advisory
fee equal to 0.50% of each Fund's average daily net assets. As a result of
contractual obligations, the Adviser may be required to waive a portion of its
fee. The Adviser can modify or terminate this waiver at its sole discretion at
any time after January 31, 2000.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Funds
Administrative Fee--Federated Services Company ("FServ") provides the Funds with
certain administrative personnel and services. This fee is based on the level of
average aggregate net assets of the Trust (excluding Wachovia Prime Money Market
Fund) and The Wachovia Municipal Funds for the period. FServ may voluntarily
waive a portion of its fee. Prior to December 4, 1997, the administrative fee
during any fiscal year for the Funds aggregated at least $75,000. After that
date, FServ ceased imposing a minimum administrative fee.
Distribution Services Fee--Under the terms of the Plan, each Fund will
compensate Federated Securities Corp. ("FSC"), the principal distributor, from
its net assets to finance activities intended to result in the sale of each
Fund's Investment Shares. The Plan provides that each Fund may incur
distribution expenses up to 0.40% of the average daily net assets of its
Investment Shares, annually, to compensate FSC.
Transfer Agent and Dividend Disbursing Agent Fees--FServ, through its
subsidiary, Federated Shareholder Services Company ("FSSC") serves as transfer
and dividend disbursing agent for the Funds. The fee paid to FSSC is based on
the size, type, and number of accounts and transactions made by shareholders.
FSSC may voluntarily waive any portion of its fee.
Portfolio Accounting Fees--FServ, through its subsidiary, FSSC, maintains the
Funds' accounting records for which it receives a fee. The fee is based on the
level of each Fund's average daily net assets for the period, plus out-of-pocket
expenses.
Custodian Fees--Wachovia Bank, N.A. is the Funds' custodian for which it
receives a fee. The fee is based on the level of each Fund's average daily net
assets for the period, plus out-of-pocket expenses.
General--Certain of the Officers and Trustees of the Trust are Officers and
Directors or Trustees of the above companies.
5. Year 2000
Similar to other financial organizations, the Funds could be adversely affected
if the computer systems used by the Funds' service providers do not properly
process and calculate date-related information and data from and after January
1, 2000. The Funds' Adviser and administrator are taking measures that they
believe are reasonably designed to address the Year 2000 issue with respect to
computer systems that they use and to obtain reasonable assurances that
comparable steps are being taken by each of the Funds' other service providers.
At this time, however, there can be no assurance that these steps will be
sufficient to avoid any adverse impact to the Funds.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Trustees Officers
James A. Hanley John W. McGonigle
Samuel E. Hudgins President and Treasurer
J. Berkley Ingram, Jr. Charles L. Davis, Jr.
D. Dean Kaylor Vice President and Assistant
Alvin J. Schexnider Treasurer
Charles S. Way, Jr. Peter J. Germain
Secretary
Gail Cagney
Assistant Secretary
Mutual funds are not bank deposits or obligations, are not guaranteed by any
bank, and are not insured or guaranteed by the U.S. government, the Federal
Deposit Insurance Corporation, the Federal Reserve Board, or any other
government agency. Investment in mutual funds involves risk, including the
possible loss of principal.
This report is authorized for distribution to prospective investors only when
preceded or accompanied by the funds' prospectus which contain facts concerning
their investment objectives and policies, management fees, expenses and other
information.
Federated Securities Corp., Distributor
831-21 (7/99)
Cusip 929901106
Cusip 929901203
Cusip 929901304
Cusip 929901403
Cusip 929901833
Cusip 929901825
3062501 (7/99)
WACHOVIA PRIME CASH
MANAGEMENT FUND
WACHOVIA TAX-FREE
MONEY MARKET FUND
WACHOVIA U.S. TREASURY
MONEY MARKET FUND
INSTITUTIONAL SHARES
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
President's Message
Dear Shareholder:
I am pleased to present the Semi-Annual Report to Shareholders of the Wachovia
Money Market Funds--Institutional Shares, for the six-month period from December
1, 1998 through May 31, 1999. This report includes a listing of each fund's
holdings and complete financial information.*
Each Wachovia Money Market Fund continued to provide investors with daily income
on their accessible cash, while maintaining a stable $1.00 share value.** The
fund-by-fund highlights are as follows:
Wachovia Prime Cash Management Fund
The fund's portfolio of high-quality money market securities provided
shareholders with dividends totaling $0.02 per share, while maintaining a stable
share value of $1.00.** The fund's Institutional Shares net assets totaled $1.9
billion at the end of the reporting period.
Wachovia Tax-Free Money Market Fund
The fund's portfolio of tax-free money market securities were invested among
securities issued by municipalities across the U.S. The fund provided
shareholders with federally tax-free*** dividends totaling $0.01 per share,
while maintaining a stable share value of $1.00.** The fund's Institutional
Shares net assets totaled $257.0 million at the end of the reporting period.
Wachovia U. S. Treasury Money Market Fund
The fund's portfolio of U.S. Treasury money market securities paid dividends of
$0.02 per share, while maintaining a stable share value of $1.00.** The fund's
Institutional Shares net assets totaled $433.0 million at the end of the
reporting period.
Thank you for choosing the Wachovia Money Market Funds to keep your invested
cash working and accessible--every day.
Sincerely,
John W. McGonigle
President
July 15, 1999
* The composition and holdings of the funds are subject to change. Past
performance is no guarantee of further results.
** An investment in money market funds is neither insured nor guaranteed by the
Federal Deposit Insurance Corporation or any other government agency.
Although money market funds seek to preserve the value of your investment at
$1.00 per share, it is possible to lose money by investing in the funds.
*** Income may be subject to the federal alternative minimum tax and state and
local taxes.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Prime Cash Management Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
(1) Bank Notes--7.0%
$25,000,000 First National Bank, 4.900%, 9/2/1999 $ 25,000,316
20,000,000 LaSalle National Bank, Chicago, 5.130%, 4/25/2000 19,993,057
90,000,000 NationsBank NA, 4.840%-4.930%, 6/8/1999-7/7/1999 90,000,000
--------------
Total Bank Notes 134,993,373
--------------
(1) Certificates of Deposit--30.1%
62,000,000 ABN AMRO Bank N.V., Amsterdam, 4.905%-4.990%,
10/12/1999-11/10/1999 62,004,038
90,000,000 Barclays Bank PLC, London, 4.940%,
9/15/1999-9/16/1999 90,002,591
50,000,000 CIBC Bank, New York, Yankee CD, 4.860%, 7/22/1999 50,000,000
75,000,000 Deutsche Bank, AG, 4.875%, 8/4/1999 75,000,656
50,000,000 Morgan Guaranty Trust Co., London, 4.870%,
7/16/1999 50,000,000
55,000,000 National Westminster Bank, PLC, London, 5.030%-
5.620%, 7/26/1999-1/10/2000 54,990,166
15,000,000 Toronto Dominion Bank, New York, Yankee CD,
5.020%, 1/6/2000 14,997,395
50,000,000 Toronto-Dominion Bank, 5.780%, 6/9/1999 49,999,580
25,000,000 UBS AG, 4.970%, 11/15/1999 25,001,131
20,000,000 Union Bank of Switzerland, Zurich, 5.630%,
8/17/1999 19,997,774
90,000,000 Westdeutsche Landesbank Girozentrale, 4.890%-
5.115%, 6/2/1999-12/7/1999 90,002,525
--------------
Total Certificates of Deposit 581,995,856
--------------
(1) Commercial Paper--23.2%
Basic Materials--1.1%
21,800,000 Rio Tinto America, Inc., 4.830%, 6/15/1999-
6/24/1999 21,749,392
--------------
Chemical & Allied Products--2.1%
40,000,000 Du Pont (E.I.) de Nemours & Co., 4.913%,
6/23/1999 39,881,689
--------------
Consumer Non-Durables--2.6%
50,000,000 Coca-Cola Co., 4.863%, 6/22/1999 49,860,000
--------------
Finance--Automotive--4.6%
90,000,000 Ford Motor Credit Corp., 4.858%-4.878%, 6/8/1999-
8/19/1999 89,455,627
--------------
Finance--Commercial--6.9%
55,000,000 Associates Corp. of North America, 4.820%,
6/16/1999 54,889,542
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Prime Cash Management Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
(1) Commercial Paper--continued
$45,000,000 General Electric Capital Corp., 4.810%-4.840%,
7/22/1999-8/12/1999 $ 44,622,367
$35,000,000 General Electric Capital Services, 4.840%,
7/22/1999 34,760,017
--------------
Total 134,271,926
--------------
Healthcare--3.4%
64,900,000 Pfizer, Inc., 4.800%, 6/2/1999 64,891,401
--------------
Technology--2.5%
49,600,000 Xerox Credit Corp., 4.848%, 7/12/1999 49,329,418
--------------
Total Commercial Paper 449,439,453
--------------
(1) Corporate Notes--5.2%
35,000,000 Associates Corp. of North America, 4.790%,
7/13/1999 34,804,408
40,000,000 First Union National Bank, Charlotte, NC, 4.910%,
7/26/1999 40,000,000
25,000,000 PNC Bank, NA, 4.801%, 3/1/2000 24,996,294
--------------
Total Corporate Notes 99,800,702
--------------
(2) Notes-Variable--18.4%
Finance--Banks--13.7%
30,000,000 First National Bank of Chicago, 4.960%, 6/1/1999 29,998,134
30,000,000 First National Bank of Chicago, 4.880%, 8/9/1999 29,994,909
75,000,000 Mellon Bank NA, Pittsburgh, 4.900%, 6/18/1999 74,992,102
15,000,000 SouthTrust Bank, NA, 4.800%, 6/14/1999 14,993,634
75,000,000 SouthTrust Bank, NA, 4.823%, 6/7/1999 74,989,849
40,000,000 Texaco Capital, Inc., 4.845%, 8/3/1999 39,967,589
--------------
Total 264,936,217
--------------
Student Loan Marketing Association--4.7%
30,000,000 Student Loan Marketing Association, 5.201%,
7/15/1999 30,000,000
60,000,000 Student Loan Marketing Association, 5.271%,
2/11/2000 59,984,467
--------------
Total 89,984,467
--------------
Total Notes-Variable 354,920,684
--------------
(1) Time Deposits--7.0%
90,000,000 Citibank, Toronto, 4.900%-4.950%, 9/8/1999-
10/7/1999 90,000,000
45,000,000 First Union National Bank, Charlotte, NC, 4.920%,
11/18/1999 45,000,000
--------------
Total Time Deposits 135,000,000
--------------
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Prime Cash Management Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- ------------------------------------------------------------------------------
<C> <S> <C>
(3) Repurchase Agreements--8.8%
$65,705,808 Credit Suisse First Boston, Inc., 4.850%, dated
5/28/1999, due 6/1/1999 $ 65,705,808
46,860,000 Merrill Lynch, Pierce, Fenner and Smith, 4.790%,
dated 5/28/1999, due 6/1/1999 46,860,000
58,360,000 Morgan Stanley Group, Inc., 4.890%, dated
5/28/1999, due 6/1/1999 58,360,000
--------------
Total Repurchase Agreements 170,925,808
--------------
Total Investments (at amortized cost)(4) $1,927,075,876
--------------
</TABLE>
(1) Each issue shows the rate of discount at the time of purchase for discount
issues or the coupon for interest bearing securities.
(2) Current rate and next reset date shown.
(3) The repurchase agreements are fully collateralized by U.S. Treasury and/or
agency obligations based on market prices at the date of the portfolio.
(4) Also represents cost for federal tax purposes.
Note: The categories of investments are shown as a percentage of net assets
($1,933,251,504) at May 31, 1999.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Prime Cash Management Fund
Statement of Assets and Liabilities
May 31, 1999 (unaudited)
<TABLE>
<S> <C> <C>
Assets:
Total investments in securities, at
amortized cost and value $1,927,075,876
Income receivable 14,508,416
--------------
Total assets 1,941,584,292
Liabilities:
Income distribution payable $8,010,687
Accrued expenses 322,101
----------
Total liabilities 8,332,788
--------------
Net Assets for 1,933,251,504 shares
outstanding $1,933,251,504
--------------
Net Asset Value, Offering Price and
Redemption Proceeds Per Share:
$1,933,251,504 / 1,933,251,504 shares
outstanding $1.00
--------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Prime Cash Management Fund
Statement of Operations
Six Months Ended May 31, 1999 (unaudited)
<TABLE>
<S> <C> <C> <C>
Investment Income:
Interest $48,153,915
Expenses:
Investment advisory
fee $ 2,871,335
Administrative
personnel and
services fee 478,556
Custodian fees 114,410
Transfer and dividend
disbursing agent fees
and expenses 1,050
Directors'/Trustees'
fees 23,438
Auditing fees 7,329
Legal fees 8,804
Share registration
costs 69,547
Printing and postage 6,268
Insurance premiums 5,735
Miscellaneous 4,938
-----------
Total expenses 3,591,410
Waiver of
investment advisory
fee (1,866,686)
-----------
Net expenses 1,724,724
-----------
Net investment income $46,429,191
-----------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Prime Cash Management Fund
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Six Months Ended
(unaudited) Year Ended
May 31, 1999 November 30, 1998
- ------------------------------------------------------------------------------
<S> <C> <C>
Increase (Decrease) in Net Assets:
Operations--
Net investment income $ 46,429,191 $ 92,391,044
-------------- --------------
Distributions to Shareholders--
Distributions from net investment income (46,429,191) (92,391,044)
-------------- --------------
Share Transactions--
Proceeds from sale of shares 1,743,584,122 4,606,987,634
Cost of shares redeemed (1,639,543,853) (4,227,971,062)
-------------- --------------
Change in net assets resulting from share
transactions 104,040,269 379,016,572
-------------- --------------
Change in net assets 104,040,269 379,016,572
Net Assets:
Beginning of period 1,829,211,235 1,450,194,663
-------------- --------------
End of period $1,933,251,504 $1,829,211,235
-------------- --------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Prime Cash Management Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months
Ended
(unaudited) Year Ended November 30,
May 31, ------------------------------------------------------
1999 1998 1997 1996 1995 1994(1)
- --------------------------------------------------------------------------------------------------
<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
Income from investment
operations
Net investment income 0.02 0.05 0.05 0.05 0.06 0.04
Less distributions
Distributions from net
investment income (0.02) (0.05) (0.05) (0.05) (0.06) (0.04)
---------- ---------- ---------- ---------- -------- --------
Net asset value,
end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- -------- --------
Total return (2) 2.44% 5.54% 5.55% 5.44% 5.95% 4.02%
Ratios to average
net assets
Expense (3) 0.38%(4) 0.37% 0.43% 0.45% 0.45% 0.46%(4)
Net investment
income (3) 4.65%(4) 5.21% 5.18% 5.07% 5.53% 4.03%(4)
Expenses (after
waivers) 0.18%(4) 0.18% 0.18% 0.18% 0.18% 0.18%(4)
Net investment income
(after waivers) 4.85%(4) 5.40% 5.43% 5.34% 5.80% 4.31%(4)
Supplemental data
Net assets,
end of period
(000 omitted) $1,933,252 $1,829,211 $1,450,195 $1,176,855 $879,603 $816,008
</TABLE>
(1) Reflects operations for the period from December 2, 1993 (date of initial
public investment) to November 30, 1994.
(2) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(3) As a result of contractual obligations, certain fees were waived. If such
waivers had not occurred, the ratios would have been as indicated.
(4) Computed on an annualized basis.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--93.1%
Alabama--9.0%
$ 2,200,000 Alabama HFA, Refunding Revenue Bonds (Series B)
Weekly VRDNs $ 2,200,000
1,000,000 Birmingham, AL, (Series A) Weekly VRDNs (First
Alabama Bank, Memphis LOC) 1,000,000
3,320,000 Birmingham, AL, GO (Series 1992A) Weekly VRDNs
(Regions Bank, Alabama LOC) 3,320,000
20,700,000 Daphne-Villa Mercy, AL Special Care Facilities,
Health, Hospital, Nursing Home Improvement Revenue
Bonds Weekly VRDNs (Mercy Medical Center)/(Amsouth
Bancorporation LOC) 20,700,000
10,300,000 The Board of Trustees of the University of Alabama,
University & College Improvements (Series B) Weekly
VRDNs 10,300,000
375,000 Tuscaloosa County, AL Port Authority, (Series
1989A) Weekly
VRDNs (Capstone Hotel Ltd.)/(SouthTrust Bank of
Alabama, Birmingham LOC) 375,000
------------
Total 37,895,000
------------
Alaska--4.7%
20,000,000 Alaska State Housing Finance Corp., Revenue Bonds
(Series 1991C) Weekly VRDNs (Swiss Bank Capital
Markets LOC) 20,000,000
------------
Arizona--2.3%
9,500,000 Arizona School District, (Series A), 4.10% TANs,
7/30/1999 9,510,241
100,000 Phoenix, AZ, GO UT Bonds Daily VRDNs 100,000
------------
Total 9,610,241
------------
Delaware--1.1%
4,455,000 Delaware State, GO UT Public Improvement Refunding Bonds (Series
A), 4.50%, 2/1/2000 4,501,168
------------
Florida--8.1%
5,000,000 Alachua County, FL Health Facilities Authority, Health Facilities
Revenue Bonds (Series 1996B) Weekly VRDNs (Shands Teaching Hospital
and Clinics, Inc.)/(MBIA INS)/(SunTrust Bank, Central Florida
LIQ) 5,001,925
5,000,000 Broward County, FL HFA, Revenue Bonds Weekly VRDNs
(Welleby Apartments) 5,000,000
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
Florida--continued
$ 6,600,000 Collier County, FL HFA, Multi-family Revenue Bonds
(Series 1985) Weekly VRDNs (River Reach Project) $ 6,600,000
1,600,000 Escambia County, FL Health Facilities Authority,
IDRB (Series A) Monthly VRDNs (Florida Convalescent
Centers, Inc.)/(Toronto-Dominion Bank LOC) 1,600,000
2,830,000 Eustis Health Facilities Authority, FL, (Series
1985) Weekly VRDNs (Waterman Medical
Center)/(Paribas, Paris LOC) 2,830,000
600,000 Polk County, FL IDA, Refunding Revenue Bonds
Monthly VRDNs (Florida Convalescent Centers,
Inc.)/(Toronto-Dominion Bank LOC) 600,000
1,000,000 Polk County, FL IDA, Refunding Revenue Bonds Weekly
VRDNs (IMC Fertilizer, Inc. Project)/(Rabobank
Nederland, Utrecht LOC) 1,000,000
4,600,000 Southeast Volusia Hospital District, FL, Revenue
Bonds (Series 1995) Weekly VRDNs (Bert Fish Medical
Center (FL))/(SouthTrust Bank of Alabama,
Birmingham LOC) 4,600,000
7,000,000 St. Lucie County, FL PCR, 2.75% CP, Mandatory
Tender 6/10/1999 7,000,000
------------
Total 34,231,925
------------
Georgia--6.0%
8,600,000 De Kalb Private Hospital Authority, GA, Revenue
Anticipation Certificates (Series 1994B) Weekly
VRDNs (Egleston Children's Hospital at Emory
University, Inc.)/(SunTrust Bank, Atlanta LOC) 8,600,000
5,000,000 De Kalb Private Hospital Authority, GA, Revenue
Anticipation Certificates (Series 1995B) Weekly
VRDNs (Egleston Children's Hospital at Emory
University, Inc.)/(SunTrust Bank, Atlanta LOC) 4,999,999
2,500,000 Georgia State, GO UT (Series E), 6.70% Bonds,
7/1/1999 2,506,238
2,900,000 Lowndes County, GA Residential Care Facilities for
the Elderly Authority Weekly VRDNs (South Georgia
Health Alliance Project) 2,900,000
845,000 Macon-Bibb County, GA Urban Development Authority,
Refunding Revenue Bonds (Series 1995) Weekly VRDNs
(Macon Hotel Investors Project)/(NBD Bank, Michigan
LOC) 845,000
500,000 Monroe County, GA Development Authority IDRB,
Refunding
Revenue Bonds Weekly VRDNs (Forsyth Inns,
Inc.)/(NBD Bank,
Michigan LOC) 500,000
5,120,000 Richmond County, GA Board of Education, GO UT
Refunding
Revenue Bonds, 4.50%, 3/1/2000 5,179,651
------------
Total 25,530,888
------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
Illinois--9.3%
$ 5,000,000 Chicago, IL, 2.85% TOBs (Morgan Guaranty Trust Co.,
New York LOC), Mandatory Tender 10/28/1999 $ 5,000,000
11,900,000 Illinois Development Finance Authority Weekly VRDNs 11,900,000
740,000 Illinois Development Finance Authority, Revenue
Bonds Weekly VRDNs (Aurora Central Catholic High
School) 740,000
1,000,000 Illinois Development Finance Authority, Revenue
Bonds Weekly VRDNs (Lake Forest Academy)/(Northern
Trust Corp. LOC) 1,000,000
1,155,000 Illinois Development Finance Authority, Revenue
Bonds Weekly VRDNs (Little City Foundation) 1,155,000
3,800,000 Illinois Development Finance Authority, Revenue
Bonds Weekly VRDNs (St. Ignatius College) 3,800,000
1,525,000 Illinois Development Finance Authority, Revenue
Bonds Weekly VRDNs (St. Paul's House)/(LaSalle
National Bank, Chicago LOC) 1,525,000
4,500,000 Illinois Development Finance Authority, (Series A)
Weekly VRDNs (Presbyterian Home Lake)/(LaSalle
National Bank, Chicago LOC) 4,500,000
8,600,000 Jackson-Union Counties, IL Regional Port District
Facilities Weekly VRDNs (Enron Transportation
Services) 8,600,000
1,000,000 Orland Hills, IL, Multi-family Mortgage Revenue
Bonds Weekly VRDNs (LaSalle National Corp. LOC) 1,000,000
------------
Total 39,220,000
------------
Iowa--1.2%
5,000,000 Iowa School Corporations, (Series B), 3.50% Bonds,
1/28/2000 (FSA INS) 5,016,969
------------
Kentucky--0.9%
3,100,000 Clark County, KY Pollution Control, (Series J-2)
VRDNs (East Kentucky Power Cooperative,
Inc.)/(National Rural Utilities Cooperative Finance
Corp. GTD) 3,100,000
600,000 Georgetown, KY Educational Institution, Revenue
Bonds Weekly VRDNs (Georgetown College) 600,000
------------
Total 3,700,000
------------
Louisiana--1.1%
1,700,000 Calcasieu Parish, LA, IDB, PCR Bonds Weekly VRDNs
(Citgo Petroleum Corp.) 1,700,000
2,800,000 Lake Charles, LA Harbor & Terminal District,
Revenue Bonds Weekly VRDNs (Citgo Petroleum Corp.) 2,800,000
------------
Total 4,500,000
------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
Massachusetts--6.3%
$20,000,000 Commonwealth of Massachusetts, (Series B) Weekly
VRDNs (Toronto-Dominion Bank LOC) $ 20,000,000
100,000 Massachusetts HEFA, (Series P-1) Weekly VRDNs
(Partners Healthcare Systems)/(FSA SA) 100,000
6,500,000 Massachusetts Municipal Wholesale Electric Co.,
Power Supply System Revenue Bonds (Series 1994C)
Weekly VRDNs (Canadian Imperial Bank of Commerce
LOC) 6,500,000
------------
Total 26,600,000
------------
Mississippi--0.5%
2,340,000 Jackson County, MS, 2.90% TOBs, Optional Tender
8/1/1999 (Chevron Corp. GTD) 2,340,000
------------
Missouri--0.4%
1,800,000 Kansas City, MO IDA, IDRB Weekly VRDNs (Mid-
American Health Services) 1,800,000
------------
New Mexico--1.7%
7,000,000 New Mexico State, 4.25% TRANs, 6/30/1999 7,003,490
------------
New York--8.1%
6,510,000 Monroe County, NY, GO UT Refunding Bonds, 5.00%,
3/1/2000 6,609,694
100,000 New York City, NY, (Subseries B-4) Daily VRDNs (MBIA INS)/(National
Westminster Bank, PLC, London LIQ) 100,000
4,225,000 New York City, NY, GO UT Bonds Daily VRDNs 4,225,000
11,400,000 New York City, NY, GO UT Refunding Bonds (Subseries
E-3) Daily VRDNs 11,400,000
11,700,000 New York City, NY, (Subseries E-2) Daily VRDNs
(Morgan Guaranty Trust Co., New York LOC) 11,700,000
------------
Total 34,034,694
------------
North Carolina--3.1%
1,500,000 Alamance County, NC Industrial Facilities &
Pollution Control Financing Authority, Revenue
Bonds Weekly VRDNs (SCI Systems, Inc.) 1,500,000
2,000,000 North Carolina Educational Facilities Finance
Agency Weekly VRDNs (Gardner Webb
University)/(First Union National Bank, Charlotte,
NC LOC) 2,000,000
9,700,000 North Carolina Medical Care Commission, Revenue
Bonds (Series A) Weekly VRDNs (Pooled Financing
Program) 9,700,000
------------
Total 13,200,000
------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
Ohio--4.2%
$ 945,000 Centerville, OH, Health Care Revenue Bonds Weekly
VRDNs (Bethany Lutheran Village) $ 945,000
1,900,000 Columbus, OH, GO UT (Series 1) Weekly VRDNs 1,900,000
10,000,000 Lorain County, OH, (Series A), 2.75% CP, Mandatory
Tender 6/10/1999 10,000,000
5,000,000 Lorain County, OH, (Series A), 3.30% CP, Mandatory
Tender 6/3/1999 5,000,000
------------
Total 17,845,000
------------
Oklahoma--1.0%
4,300,000 Tulsa County, OK ISD Number 001, School
Improvements, 5.00% Bonds, 2/1/2000 4,357,424
------------
Oregon--4.6%
10,000,000 Multnomah County, OR, Cash Flow Management Revenue
Notes, 4.50% TRANs, 6/30/1999 10,007,286
4,400,000 Oregon State, Veteran's Welfare Bonds (Series 73-E)
Weekly VRDNs (Morgan Guaranty Trust Co., New York
LOC) 4,400,000
5,000,000 Oregon State, Veteran's Welfare Bonds (Series 73-F)
Weekly VRDNs (Morgan Guaranty Trust Co., New York
LOC) 5,000,000
------------
Total 19,407,286
------------
Pennsylvania--1.9%
4,900,000 Allegheny County, PA IDA, Revenue Bonds (Series A)
Weekly VRDNs (United Jewish Federation of Greater
Pittsburgh VRDB)/(PNC Bank, NA LOC) 4,900,000
3,000,000 Philadelphia, PA School District, (Series B), 4.25%
TRANs (PNC Bank, NA LOC), 6/30/1999 3,000,000
------------
Total 7,900,000
------------
South Carolina--0.9%
4,000,000 South Carolina State, GO UT (Series B), 5.75%
Bonds, 8/1/1999 4,014,276
------------
Tennessee--5.4%
4,250,000 Clarksville, TN Public Building Authority,
Adjustable Rate Pooled Financing Revenue Bonds
(Series 1997) Weekly VRDNs (Tennessee Municipal
Bond Fund)/(Nationsbank, NA, Charlotte LOC) 4,250,000
1,300,000 Clarksville, TN Public Building Authority, Public
Improvement Revenue Bonds Weekly VRDNs 1,300,000
7,395,000 Knox County, TN, GO UT Refunding Bonds, 4.50%,
3/1/2000 7,481,156
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
Tennessee--continued
$ 3,000,000 Metropolitan Government Nashville & Davidson
County, TN IDB, Multi-family Housing Revenue Bonds
(Series B) Weekly VRDNs (Arbor Crest LP)/(Chase
Manhattan Bank N.A., New York and LaSalle National
Corp. LOCs) $ 3,000,000
4,600,000 Metropolitan Nashville Tennessee AA, (Series 1993) Weekly VRDNs
(FGIC INS)/(Societe Generale, Paris LIQ)/(Societe Generale, Paris
LOC) 4,600,000
2,000,000 Montgomery County, TN Public Building Authority
Weekly VRDNs 2,000,000
------------
Total 22,631,156
------------
Texas--6.0%
10,600,000 Lower Neches Valley, TX, Refunding Revenue Bonds,
3.45% TOBs (Chevron U.S.A., Inc.), Optional Tender
8/16/1999 10,600,000
3,900,000 Richardson, TX ISD, (Series A) Weekly VRDNs (PSFG
GTD)/(Union Bank of Switzerland, Zurich SA) 3,900,000
10,500,000 Texas State, GO UT, 7.125% Bonds, 4/1/2000
(Callable @102) 11,031,451
------------
Total 25,531,451
------------
Virginia--1.5%
300,000 Roanoke, VA IDA, (Series B) Daily VRDNs (Carillion
Health System) 300,000
6,190,000 Virginia College Building Authority, University and
College Improvement Revenue Bonds, 5.00%, 2/1/2000 6,274,494
------------
Total 6,574,494
------------
Washington--2.4%
10,000,000 Port Anacortes, WA Industrial Development Corp.
VRDNs (Texaco, Inc.) 10,000,000
100,000 Washington Health Care Facilities Authority,
Variable Rate Demand Revenue Bonds (Series 1997B)
Daily VRDNs (Virginia Mason Medical Center)/(MBIA
INS)/(Credit Suisse First Boston LIQ) 99,998
------------
Total 10,099,998
------------
West Virginia--1.4%
6,000,000 West Virginia State Hospital Finance Authority,
(Series A) Weekly VRDNs (Oak Hill, WV)/(First
National Bank of Chicago COL) 6,000,000
------------
Total Short-Term Municipals 393,545,460
------------
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Shares Value
- ------------------------------------------------------------------------------
<C> <S> <C>
Open-End Investment Companies--6.5%
76,057 AIM Global Management Short Term Investments Money
Market Fund $ 76,057
7,532,830 Dreyfus Tax Exempt Money Market Fund 7,532,830
904,487 Federated Investors Tax-Free Obligations Fund 904,487
18,778,173 Fidelity Tax Exempt Money Market Fund 18,778,174
------------
Total Open-End Investment Companies 27,291,548
------------
Total Investments, at amortized cost and value (1) $420,837,008
------------
</TABLE>
(1) Also represents cost for federal tax purposes.
Note: The categories of investments are shown as a percentage of net assets
($422,417,507) at May 31, 1999.
The following acronyms are used throughout this portfolio:
COL--Collateralized LOCs--Letter(s) of Credit
CP--Commercial Paper MBIA--Municipal Bond Investors
FGIC--Financial Guaranty Insurance Company Assurance
FSA--Financial Security Assurance PCR--Pollution Control Revenue
GO--General Obligation PSFG--Permanent School Fund
GTD--Guaranteed Guarantee
SA--Support Agreement
HEFA--Health and Education Facilities Authority
HFA--Housing Finance Authority TANs--Tax Anticipation Notes
IDA--Industrial Development Authority TOBs--Tender Option Bonds
IDB--Industrial Development Bond TRANs--Tax and Revenue Anticipation
IDRB--Industrial Development Revenue Bond Notes
INS--Insured UT--Unlimited Tax
ISD--Independent School District VRDB--Variable Rate Demand Bond
LIQ--Liquidity Agreement VRDNs--Variable Rate Demand Notes
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
Statements of Assets and Liabilities
May 31, 1999 (unaudited)
<TABLE>
<S> <C> <C>
Assets:
Total investments in securities, at
amortized cost and value $420,837,008
Income receivable 1,759,126
Receivable for shares sold 19,806
Receivable for investments sold 1,237,150
------------
Total assets 423,853,090
Liabilities:
Income distribution payable $1,108,467
Accrued expenses 327,116
----------
Total liabilities 1,435,583
------------
Net Assets for 422,417,507 shares
outstanding $422,417,507
------------
Net Asset Value, Offering Price and
Redemption Proceeds Per Share:
Institutional Shares:
$256,978,889/256,978,889 shares
outstanding $1.00
------------
Investment Shares:
$165,438,618/165,438,618 shares
outstanding $1.00
------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
Statement of Operations
Six Months Ended May 31, 1999 (unaudited)
<TABLE>
<S> <C> <C>
Investment Income:
Interest $6,659,240
Expenses:
Investment advisory fee $1,058,302
Administrative personnel and services fee 188,633
Custodian fees 37,982
Transfer and dividend disbursing agent fees and
expenses 2,102
Directors'/Trustees' fees 3,669
Auditing fees 7,879
Legal fees 2,779
Portfolio accounting fees 404
Distribution services fee--Investment Shares 292,256
Share registration costs 17,049
Printing and postage 12,567
Insurance premiums 2,195
Miscellaneous 8,059
----------
Total expenses 1,633,876
Waiver of investment advisory fee (839,381)
----------
Net expenses 794,495
----------
Net investment income $5,864,745
----------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Six Months Ended
(unaudited) Year Ended
May 31, 1999 November 30, 1998
- ------------------------------------------------------------------------------
<S> <C> <C>
Increase (Decrease) in Net Assets:
Operations--
Net investment income $ 5,864,745 $ 11,680,208
------------ ------------
Distributions to Shareholders--
Distributions from net investment income
Institutional Shares (4,026,276) (8,367,231)
Investment Shares (1,838,469) (3,312,977)
------------ ------------
Change in net assets resulting from
distributions
to shareholders (5,864,745) (11,680,208)
------------ ------------
Share Transactions--
Proceeds from sale of shares 375,503,471 743,274,021
Cost of shares redeemed (361,619,573) (603,065,021)
------------ ------------
Change in net assets resulting from share
transactions 13,883,898 140,209,000
------------ ------------
Change in net assets 13,883,898 140,209,000
Net Assets:
Beginning of period 408,533,609 268,324,609
------------ ------------
End of period $422,417,507 $408,533,609
------------ ------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
Financial Highlights--Institutional Shares
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months
Ended
(unaudited) Year Ended November 30,
May 31, ----------------------------------------------
1999 1998 1997 1996 1995 1994
- ---------------------------------------------------------------------------------------
<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
Income from investment
operations
Net investment income 0.01 0.03 0.03 0.03 0.04 0.02
Less distributions
Distributions from net
investment income (0.01) (0.03) (0.03) (0.03) (0.04) (0.02)
-------- -------- -------- -------- ------- -------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- ------- -------
Total return (1) 1.47% 3.29% 3.41% 3.24% 3.59% 2.42%
Ratios to average net
assets
Expense (2) 0.64%(3) 0.66% 0.69% 0.72% 0.78% 0.83%
Net investment
income (2) 2.51%(3) 2.82% 2.89% 2.79% 3.09% 1.96%
Expenses (after
waivers) 0.24%(3) 0.24% 0.24% 0.29% 0.32% 0.38%
Net investment
income (after waivers) 2.91%(3) 3.24% 3.34% 3.22% 3.55% 2.41%
Supplemental data
Net assets, end of
period (000 omitted) $256,979 $275,323 $182,473 $118,877 $80,274 $93,867
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(2) As a result of contractual obligations, certain fees were waived. If such
waivers had not occurred, the ratios would have been as indicated.
(3) Computed on an annualized basis.
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
Financial Highlights--Investment Shares
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months
Ended
(unaudited) Year Ended November 30,
May 31, ---------------------------------------------
1999 1998 1997 1996 1995 1994
- --------------------------------------------------------------------------------------
<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
Income from investment
operations
Net investment income 0.01 0.03 0.03 0.03 0.03 0.02
Less distributions
Distributions from net
investment income (0.01) (0.03) (0.03) (0.03) (0.03) (0.02)
-------- -------- ------- ------- ------- -------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- ------- ------- ------- -------
Total return (1) 1.27% 2.88% 2.99% 2.83% 3.25% 2.11%
Ratios to average net
assets
Expenses (2) 1.04%(3) 1.05% 1.09% 1.12% 1.18% 1.23%
Net investment
income (2) 2.11%(3) 2.42% 2.48% 2.41% 2.67% 1.56%
Expense (after waivers) 0.64%(3) 0.64% 0.64% 0.69% 0.66% 0.68%
Net investment income
(after waivers) 2.51%(3) 2.83% 2.93% 2.84% 3.19% 2.11%
Supplemental data
Net assets, end of
period (000 omitted) $165,439 $133,211 $85,852 $74,922 $55,733 $42,820
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(2) As a result of contractual obligations, certain fees were waived. If such
waivers had not occurred, the ratios would have been as indicated.
(3) Computed on an annualized basis.
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia U.S. Treasury Money Market Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
U.S. Government Obligations--42.8%
U.S. Treasury Bills--5.6%
$ 35,000,000 7/29/1999-9/23/1999 $ 34,623,798
------------
U.S. Treasury Notes--37.2%
230,000,000 5.375%-6.875%, 5/31/1999-1/31/2000 230,803,564
------------
Total U.S. Government Obligations 265,427,362
------------
(1) Repurchase Agreements--57.0%
28,139,297 Goldman Sachs Group, LP, 4.500%, dated 5/28/1999,
due
6/1/1999 28,139,297
28,240,000 First Boston, 4.850%, dated 5/28/1999, due
6/1/1999 28,240,000
148,340,000 Merrill Lynch, Pierce, Fenner and Smith, 4.790%,
dated
5/28/1999, due 6/1/1999 148,340,000
148,340,000 Morgan Stanley Group, Inc., 4.800%, dated
5/28/1999, due
6/1/1999 148,340,000
------------
Total Repurchase Agreements 353,059,297
------------
Total Investments, at amortized cost and value (2) $618,486,659
------------
</TABLE>
(1) The repurchase agreements are fully collateralized by U.S. Treasury and/or
agency obligations based on market prices at the date of the portfolio.
(2) Also represents cost for federal tax purposes.
Note: The categories of investments are shown as a percentage of net assets
($619,701,798) at May 31, 1999.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia U.S. Treasury Money Market Fund
Statement of Assets and Liabilities
May 31, 1999 (unaudited)
<TABLE>
<S> <C> <C>
Assets:
Investments in repurchase agreements $353,059,297
Investments in securities 265,427,362
------------
Total investments in securities, at amortized
cost and value $618,486,659
Income receivable 4,011,533
------------
Total assets 622,498,192
Liabilities:
Income distribution payable 2,637,198
Accrued expenses 159,196
------------
Total liabilities 2,796,394
------------
Net Assets for 619,701,798 shares outstanding $619,701,798
------------
Net Asset Value, Offering Price and Redemption
Proceeds Per Share:
Institutional Shares:
$433,009,775/433,009,775 shares outstanding $1.00
------------
Investment Shares:
$186,692,023/186,692,023 shares outstanding $1.00
------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia U.S. Treasury Money Market Fund
Statement of Operations
Six Months Ended May 31, 1999 (unaudited)
<TABLE>
<S> <C> <C>
Investment Income:
Interest $16,242,803
Expenses:
Investment advisory fee $ 1,686,979
Administrative personnel and services fee 300,985
Custodian fees 52,445
Transfer and dividend disbursing agent fees and
expenses 2,291
Directors'/Trustees' fees 8,228
Auditing fees 7,427
Legal fees 571
Portfolio accounting fees 213
Distribution services fee--Investment Shares 384,200
Share registration costs 22,217
Printing and postage 12,858
Insurance premiums 3,429
Miscellaneous 4,976
-----------
Total expenses 2,486,819
Waiver of investment advisory fee (1,292,699)
-----------
Net expenses 1,194,120
-----------
Net investment income $15,048,683
-----------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia U.S. Treasury Money Market Fund
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Six Months Ended
(unaudited) Year Ended
May 31, 1999 November 30, 1998
- ------------------------------------------------------------------------------
<S> <C> <C>
Increase (Decrease) in Net Assets:
Operations--
Net investment income $ 15,048,683 $ 34,194,612
------------- ---------------
Distributions to Shareholders--
Distributions from net investment income
Institutional Shares (11,014,099) (27,082,585)
Investment Shares (4,034,584) (7,112,027)
------------- ---------------
Change in net assets resulting from
distributions to shareholders (15,048,683) (34,194,612)
------------- ---------------
Share Transactions--
Proceeds from sale of shares 709,853,610 1,496,501,247
Net asset value of shares issued to
shareholders in payment of distributions
declared 15,523 27,832
Cost of shares redeemed (755,476,721) (1,459,037,222)
------------- ---------------
Change in net assets resulting from share
transactions (45,607,588) 37,491,857
------------- ---------------
Change in net assets (45,607,588) 37,491,857
Net Assets:
Beginning of period 665,309,386 627,817,529
------------- ---------------
End of period $ 619,701,798 $ 665,309,386
------------- ---------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia U.S. Treasury Money Market Fund
Financial Highlights--Institutional Shares
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months
Ended
(unaudited) Year Ended November 30,
May 31, -----------------------------------------------
1999 1998 1997 1996 1995 1994
- ----------------------------------------------------------------------------------------
<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
Income from investment
operations
Net investment income 0.02 0.05 0.05 0.05 0.06 0.04
Less distributions
Distributions from net
investment income (0.02) (0.05) (0.05) (0.05) (0.06) (0.04)
-------- -------- -------- -------- -------- -------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- -------
Total return (1) 2.26% 5.25% 5.31% 5.18% 5.66% 3.70%
Ratios to average net
assets
Expenses (2) 0.62%(3) 0.64% 0.65% 0.69% 0.72% 0.87%
Net investment
income (2) 4.19%(3) 4.75% 4.79% 4.68% 5.14% 3.21%
Expenses
(after waivers) 0.24%(3) 0.24% 0.24% 0.30% 0.32% 0.36%
Net investment income
(after waivers) 4.57%(3) 5.15% 5.20% 5.07% 5.54% 3.72%
Supplemental data
Net assets, end of
period (000 omitted) $433,010 $466,538 $510,323 $302,306 $214,356 $87,531
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(2) As a result of contractual obligations, certain fees were waived. If such
waivers had not occurred, the ratios would have been as indicated.
(3) Computed on an annualized basis.
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia U.S. Treasury Money Market Fund
Financial Highlights--Investment Shares
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months
Ended
(unaudited) Year Ended November 30,
May 31, ----------------------------------------------
1999 1998 1997 1996 1995 1994
- ----------------------------------------------------------------------------------------
<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
Income from investment
operations
Net investment income 0.02 0.05 0.05 0.04 0.05 0.03
Less distributions
Distributions from net
investment income (0.02) (0.05) (0.05) (0.04) (0.05) (0.03)
-------- -------- -------- -------- ------- -------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- ------- -------
Total return (1) 2.06% 4.83% 4.89% 4.77% 5.30% 3.39%
Ratios to average net
assets
Expenses (2) 1.02%(3) 1.03% 1.05% 1.09% 1.12% 1.27%
Net investment
income (2) 3.79%(3) 4.34% 4.39% 4.29% 4.75% 2.81%
Expenses (after waivers) 0.64%(3) 0.63% 0.64% 0.70% 0.66% 0.66%
Net investment income
(after waivers) 4.17%(3) 4.74% 4.80% 4.68% 5.21% 3.42%
Supplemental data
Net assets, end of
period (000 omitted) $186,692 $198,771 $117,495 $104,336 $81,739 $46,396
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(2) As a result of contractual obligations, certain fees were waived. If such
waivers had not occurred, the ratios would have been as indicated.
(3) Computed on an annualized basis.
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Funds
Combined Notes to Financial Statements
May 31, 1999 (unaudited)
1. Organization
The Wachovia Funds (the "Trust") is registered under the Investment Company Act
of 1940, as amended (the "Act"), as an open-end, management investment company.
The Trust consists of fourteen portfolios. The following portfolios are included
herein (individually referred to as the "Fund", or collectively as the "Funds"):
<TABLE> <S> <C>
Portfolio Investment Objective
- -------------------------------------------------------------------------------
Wachovia Prime Cash Management Fund To provide current income consistent
("Prime Cash Fund") with stability of principal and
liquidity.
- -------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund To provide current income exempt from
("Tax-Free Fund") federal regular income tax consistent
with stability of principal and
liquidity.
- -------------------------------------------------------------------------------
Wachovia U.S. Treasury Money Market Fund To provide current income consistent
("U.S. Treasury Fund") with stability of principal and
liquidity.
</TABLE>
The financial statements of the other portfolios are presented separately. The
assets of each portfolio are segregated and a shareholder's interest is limited
to the portfolio in which shares are held. The Funds, except for Prime Cash
Fund, offer two classes of shares: Institutional Shares and Investment Shares.
Prime Cash Fund only offers Institutional Shares. Investment Shares are
identical in all respects to Institutional Shares except that Investment Shares
are sold pursuant to a distribution plan (the "Plan") adopted in accordance with
Rule 12b-1 under the Act.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently
followed by the Funds in the preparation of their financial statements. These
policies are in conformity with generally accepted accounting principles.
Investment Valuations--The Funds' use of the amortized cost method to value
their portfolio securities is in accordance with Rule 2a-7 under the Act.
Investments in other open-end regulated investment companies are valued at net
asset value. Repurchase Agreements--It is the policy of the Funds to require
the custodian bank to take possession, to have legally segregated in the
Federal Reserve Book Entry System, or to have segregated within the custodian
bank's vault, all securities held as collateral under repurchase agreement
transactions. Additionally, procedures have been established by the Funds to
monitor, on a daily basis, the market value of each repurchase agreement's
collateral to ensure that the value of collateral at least equals the
repurchase price to be paid under the repurchase agreement transaction. The
Funds will only enter into repurchase agreements with banks and other
recognized financial institutions, such as broker/dealers, which are deemed by
the Funds' adviser to be creditworthy pursuant to the guidelines and/or
standards reviewed or established by the Board of Trustees (the "Trustees").
Risks may arise from the potential inability of counterparties to honor the
terms of the repurchase agreement. Accordingly, the Funds could receive less
than the repurchase price on the sale of collateral securities. Investment
Income, Expenses and Distributions--Interest income and expenses are accrued
daily. Bond premium and discount, if applicable, are amortized as required by
the Internal Revenue Code, as amended (the "Code"). Distributions to
shareholders are recorded on the ex-dividend date.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Funds
Federal Taxes--It is the Funds' policy to comply with the provisions of the
Code applicable to regulated investment companies and to distribute to
shareholders each year substantially all of their income. Accordingly, no
provisions for federal tax are necessary. When-Issued and Delayed Delivery
Transactions--The Funds may engage in when-issued or delayed delivery
transactions. The Funds record when-issued securities on the trade date and
maintain security positions such that sufficient liquid assets will be
available to make payment for the securities purchased. Securities purchased
on a when-issued or delayed delivery basis are marked to market daily and
begin earning interest on the settlement date. Use of Estimates--The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the amounts of assets, liabilities, expenses and revenues reported
in the financial statements. Actual results could differ from those estimated.
Other--Investment transactions are accounted for on the trade date.
3. Shares of Beneficial Interest
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value) for each
class of shares. At May 31, 1999, capital paid-in aggregated $1,933,251,504,
$422,417,507 and $619,701,798, for Prime Cash Fund, Tax-Free Fund, and U.S.
Treasury Fund, respectively.
Transactions in shares were as follows:
<TABLE>
<CAPTION>
Prime Cash Fund Tax-Free Fund U.S. Treasury Fund
------------------------------ -------------------------- ----------------------------
Six Months Six Months Six Months
Ended Year Ended Ended Year Ended Ended Year Ended
May 31, November 30, May 31, November 30, May 31, November 30,
1999 1998 1999 1998 1999 1998
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Institutional Shares
- ------------------------
Shares sold 1,743,584,122 4,606,987,634 162,297,035 367,947,784 539,713,595 1,162,773,272
Shares redeemed (1,639,543,853) (4,227,971,062) (180,640,591) (275,098,274) (573,241,736) (1,206,558,183)
- ------------------------ -------------- -------------- ------------ ------------ ------------ --------------
Net change resulting
from Institutional
Shares transactions 104,040,269 379,016,572 (18,343,556) 92,849,510 (33,528,141) (43,784,911)
-------------- -------------- ------------ ------------ ------------ --------------
Investment Shares
- ------------------------
Shares sold -- -- 213,206,436 375,326,237 170,140,015 333,727,978
Shares issued to
shareholders in payment
of distributions
declared -- -- -- -- 15,523 27,829
Shares redeemed -- -- (180,978,982) (327,966,747) (182,234,985) (252,479,039)
- ------------------------ -------------- -------------- ------------ ------------ ------------ --------------
Net change resulting
from Investment Shares
transactions -- -- 32,227,454 47,359,490 (12,079,447) 81,276,768
-------------- -------------- ------------ ------------ ------------ --------------
Net change resulting
from share transactions 104,040,269 379,016,572 13,883,898 140,209,000 (45,607,588) 37,491,857
-------------- -------------- ------------ ------------ ------------ --------------
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Funds
4. Investment Advisory Fee and Other Transactions with Affiliates Investment
Advisory Fee--Wachovia Asset Management, the Funds' investment adviser (the
"Adviser"), receives for its services an annual investment advisory fee based on
each Fund's average daily net assets. As a result of contractual obligations,
the Adviser may be required to waive a portion of its fee. The Adviser can
modify or terminate this waiver at its sole discretion anytime after January 31,
2000. <TABLE> <CAPTION>
Fund Annual rate
---- -----------
<S> <C>
Prime Cash Fund 0.30%
Tax-Free Fund 0.50%
U.S.Treasury Fund 0.50%
</TABLE>
Administrative Fee--Federated Services Company ("FServ") provides the Funds with
certain administrative personnel and services. This fee is based on the level of
average aggregate net assets of the Trust (excluding Prime Cash Fund) and The
Wachovia Municipal Funds for the period. FServ's fee with respect to Prime Cash
Fund is based upon its average net assets. FServ may voluntarily waive a portion
of its fee. Prior to December 4, 1997, the administrative fee during any fiscal
year for the Funds aggregated at least $75,000. After that date, FServ ceased
imposing a minimum administrative fee. Distribution Services Fee--Under the
terms of the Plan, each Fund will compensate Federated Securities Corp. ("FSC"),
the principal distributor, from its net assets to finance activities intended to
result in the sale of each Fund's Investment Shares. The Plan provides that each
Fund may incur distribution expenses up to 0.40% of the average daily net assets
of its Investment Shares, annually, to compensate FSC. Transfer Agent and
Dividend Disbursing Agent Fees--FServ, through its subsidiary, Federated
Shareholder Services Company ("FSSC") serves as transfer and dividend disbursing
agent for the Funds. The fee paid to FSSC is based on the size, type, and number
of accounts and transactions made by shareholders. FSSC may voluntarily waive
any portion of its fee. Portfolio Accounting Fees--FServ, through its subsidiary
FSSC, maintains the Funds' accounting records for which it receives a fee. The
fee is based on the level of each Fund's average daily net assets for the
period, plus out-of-pocket expenses. Custodian Fees--Wachovia Bank, N.A. is the
Funds' custodian for which it receives a fee. The fee is based on the level of
each Fund's average daily net assets for the period, plus out-of-pocket
expenses. General--Certain of the Officers and Trustees of the Trust are
Officers and Directors or Trustees of the above companies.
5. Year 2000
Similar to other financial organizations, the Funds could be adversely affected
if the computer systems used by the Funds' service providers do not properly
process and calculate date-related information and data from and after January
1, 2000. The Funds' Adviser and administrator are taking measures that they
believe are reasonably designed to address the Year 2000 issue with respect to
computer systems that they use and to obtain reasonable assurances that
comparable steps are being taken by each of the Funds' other service providers.
At this time, however, there can be no assurance that these steps will be
sufficient to avoid any adverse impact to the Funds.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Trustees Officers
James A. Hanley John W. McGonigle
Samuel E. Hudgins President and Treasurer
J. Berkley Ingram, Jr. Charles L. Davis, Jr.
D. Dean Kaylor Vice President and Assistant
Alvin J. Schexnider Treasurer
Charles S. Way, Jr. Peter J. Germain
Secretary
Gail Cagney
Assistant Secretary
Mutual funds are not bank deposits or obligations, are not guaranteed by any
bank, and are not insured or guaranteed by the U.S. government, the Federal
Deposit Insurance Corporation, the Federal Reserve Board, or any other
government agency. Investment in mutual funds involves risk, including the
possible loss of principal.
This report is authorized for distribution to prospective investors only when
preceded or accompanied by the funds' prospectus which contains facts concerning
their objectives and policies, management fees, expenses and other information.
Semi-Annual Report
May 31, 1999
Cusip 929901684
Cusip 929901304
Cusip 929901403
Cusip 929901833
Cusip 929901825
G01144-04 (7/99)
Federated Securities Corp., Distributor
831-30 (7/99)
WACHOVIA MONEY MARKET FUND
INSTITUTIONAL SHARES
Semi-Annual Report
May 31, 1999
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
President's Message
Dear Shareholder:
I am pleased to present the Semi-Annual Report to Shareholders of the Wachovia
Money Market Fund--Institutional Shares, for the six-month period from December
1, 1998 through May 31, 1999. This report includes a listing of the fund's
holdings and complete financial information.*
During the reporting period, the fund's portfolio of high-quality money market
securities provided shareholders with dividends totaling $0.02 per share while
maintaining a stable share value of $1.00.** The fund's Institutional Shares
assets reached $334.5 million at the end of the reporting period.
Thank you for selecting Wachovia Money Market Fund to keep your invested cash
working and accessible--every day.
Sincerely,
/s/ John W. McGonigle
John W. McGonigle
President
July 15, 1999
* The composition and holdings of the fund are subject to change. Past
performance is no guarantee of future results.
** An investment in money market funds is neither insured nor guaranteed by the
Federal Deposit Insurance Corporation or any other government agency.
Although money market funds seek to preserve the value of your investment at
$1.00 per share, it is possible to lose money by investing in the fund.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
Portfolio of Investments
May 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Principal
Amount Value
- -----------------------------------------------------------------------------
<C> <S> <C>
(1) Bank Notes--5.7%
Banking & Finance--5.7%
$40,000,000 First National Bank of Chicago, 4.910%-5.020%,
6/2/1999-11/18/1999 $ 40,000,007
10,000,000 LaSalle National Bank, Chicago, 5.130%, 4/25/2000 9,996,528
------------
Total Bank Notes 49,996,535
------------
(1) Time Deposit--4.0%
Banking--4.0%
35,000,000 Citibank, Toronto, 4.900%-4.950%, 8/19/1999-
10/7/1999 35,000,000
------------
(1) Certificates of Deposit--32.3%
10,000,000 ABN AMRO Bank NV, Amsterdam, 4.905%, 10/12/1999 10,001,189
30,000,000 Barclays Bank PLC, London, 4.940%, 9/15/1999 30,000,861 40,000,000
CIBC Bank, New York, Yankee CD, 4.830%-5.710%,
6/17/1999-6/21/1999 39,999,475
20,000,000 Deutsche Bank, AG, 4.860%, 8/25/1999 20,000,000
15,000,000 Deutsche Bank, AG, 5.030%, 1/12/2000 15,000,901
25,000,000 Morgan Guaranty Trust Co., London, 4.870%,
7/16/1999 25,000,000
10,000,000 National Westminster Bank, PLC, London, 5.030%,
1/10/2000 9,997,054
35,000,000 NationsBank, 4.890%-5.000%, 9/15/1999-9/23/1999 35,000,000
30,000,000 Rabobank Nederland, 4.920%, 7/14/1999 30,000,000
25,000,000 Toronto Dominion Holdings (USA), Inc., 4.990%,
1/6/2000 24,995,659
20,000,000 UBS AG, 4.980%, 11/15/1999 20,000,905
15,000,000 Union Bank of Switzerland, Zurich, 5.750%,
8/17/1999 14,998,331
10,000,000 Westdeutsche Landesbank Girozentrale, 5.180%,
1/19/2000 10,008,001
------------
Total Certificates of Deposit 285,002,376
------------
(1) Commercial Paper--21.5%
Chemical & Allied Products--1.7%
15,000,000 Du Pont (E.I.) de Nemours & Co., 4.810%, 7/7/1999 14,927,850
------------
Consumer Non-Durables--2.8%
25,000,000 Coca-Cola Co., 4.800%, 6/23/1999 24,926,667
------------
Finance--5.1%
20,000,000 BellSouth Capital Funding Corp., 4.820%, 8/4/1999 19,828,622
25,000,000 CIT Group, Inc., 4.800%, 7/14/1999 24,856,667
------------
Total 44,685,289
------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
(1) Commercial Paper--continued
Finance-Automotive--1.1%
$10,000,000 Ford Motor Credit Corp., 4.810%, 8/10/1999 $ 9,906,472
------------
Finance-Commercial--6.8%
15,000,000 General Electric Capital Services Corp., 4.840%,
8/10/1999 14,858,833
20,000,000 General Electric Capital Services Corp., 4.880%,
6/9/1999 19,978,311
35,000,000 AI Credit Corp., 4.800%, 7/1/1999 34,860,000
25,000,000 Associates Corp. of North America, 4.879%,
6/16/1999 24,949,948
------------
Total 94,647,092
------------
Total Commercial Paper 189,093,370
------------
(1) Government Agencies--4.3%
Federal Home Loan Bank System--2.2%
20,000,000 4.470%, Discount Note, 10/29/1999 19,627,500
------------
Federal National Mortgage Association--2.2%
20,000,000 4.490%, Discount Note, 10/28/1999 19,628,328
------------
Total Government Agencies 39,255,828
------------
(2) Notes-Variable--24.3%
Banking--2.8%
25,000,000 PNC Bank, NA, 4.801%, 6/1/1999 24,996,294
------------
Banking & Finance--14.1%
30,000,000 Amsouth Bank, 4.823%, 6/15/1999 29,992,918
20,000,000 First Union National Bank, Charlotte, N.C., 4.910%,
6/1/1999 20,000,000
15,000,000 First Union National Bank, Charlotte, N.C., 4.930%,
7/21/1999 15,000,000
25,000,000 Mellon Bank, NA, Pittsburgh, 4.900%, 6/18/1999 24,997,368
25,000,000 SouthTrust Bank, NA, 4.820%, 6/7/1999 24,996,616
10,000,000 SouthTrust Bank, NA, 4.800%, 6/14/1999 9,995,756
------------
Total 124,982,658
Chemical & Allied Products--1.7%
15,000,000 Texaco Capital, Inc., 4.845%, 8/3/1999 14,987,740
------------
Finance-Commercial--2.3%
20,000,000 General Electric Capital Services Corp., 4.978%,
8/23/1999 20,000,000
------------
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
(2) Notes-Variable--continued
Student Loan Marketing Association--3.4%
$10,000,000 5.201%, 7/15/1999 $ 10,000,000
20,000,000 5.271%, 2/11/2000 19,994,822
------------
Total 29,994,822
------------
Total Notes-Variable 214,961,514
------------
(3) Repurchase Agreements--7.5%
33,281,628 First Boston, Inc., 4.850%, dated 5/28/1999, due
6/1/1999 33,281,628
7,500,000 Merrill Lynch, Pierce, Fenner and Smith, 4.790%,
dated 5/28/1999, due 6/1/1999 7,500,000
25,400,000 Morgan Stanley Group, Inc., 4.890%, dated
5/28/1999, due 6/1/1999 25,400,000
------------
Total Repurchase Agreements 66,181,628
------------
Total Investments (at amortized cost and values)(4) $879,491,251
------------
</TABLE>
(1) Each issue shows the rate of discount at the time of purchase for discount
issues, or the coupon for interest bearing issues.
(2) Current rate and next reset date shown.
(3) The repurchase agreements are fully collateralized by U.S. Treasury and/or
agency obligations based on market prices at the date of the portfolio.
(4) Also represents cost for federal tax purposes.
Note: The categories of investments are shown as a percentage of net assets
($881,740,692) at May 31, 1999.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
Statement of Assets and Liabilities
May 31, 1999 (unaudited)
<TABLE>
<S> <C> <C>
Assets:
Total investments in securities, at
amortized cost and value $879,491,251
Income receivable 5,977,620
Receivable for shares sold 1,002
------------
Total assets 885,469,873
Liabilities:
Payable for shares redeemed $ 501
Income distribution payable 3,259,902
Accrued expenses 468,778
----------
Total liabilities 3,729,181
------------
Net Assets for 881,740,692 shares
outstanding $881,740,692
------------
Net Asset Value, Offering Price and
Redemption Proceeds Per Share:
Institutional Shares:
$334,547,537 / 334,547,537 shares
outstanding $1.00
------------
Investment Shares:
$547,193,155 / 547,193,155 shares
outstanding $1.00
------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
Statement of Operations
Six Months Ended May 31, 1999 (unaudited)
<TABLE>
<S> <C> <C>
Investment Income:
Interest $20,254,809
Expenses:
Investment advisory fee $2,024,503
Administrative personnel and services fee 360,727
Custodian fees 59,189
Transfer and dividend disbursing agent fees and
expenses 2,246
Directors'/Trustees' fees 5,745
Auditing fees 7,743
Legal fees 1,657
Portfolio accounting fees 157
Distribution services fee--Investment Shares 1,056,972
Share registration costs 25,474
Printing and postage 14,598
Insurance premiums 2,743
Miscellaneous 3,827
----------
Total expenses 3,565,581
Waiver of investment advisory fee (971,117)
----------
Net expenses 2,594,464
-----------
Net investment income $17,660,345
-----------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Six Months Ended
(unaudited) Year Ended
May 31, 1999 November 30, 1998
- ------------------------------------------------------------------------------
<S> <C> <C>
Increase (Decrease) in Net Assets:
Operations--
Net investment income $ 17,660,345 $ 28,120,423
------------- -------------
Distributions to Shareholders--
Distributions from net investment income
Institutional Shares (6,497,531) (9,265,013)
Investment Shares (11,162,814) (18,855,410)
------------- -------------
Change in net assets resulting from
distributions
to shareholders (17,660,345) (28,120,423)
------------- -------------
Share Transactions--
Proceeds from sale of shares 798,663,247 958,837,233
Net asset value of shares issued to
shareholders in payment of distributions
declared 294,005 568,444
Cost of shares redeemed (580,626,355) (773,913,879)
------------- -------------
Change in net assets resulting from share
transactions 218,330,897 185,491,798
------------- -------------
Change in net assets 218,330,897 185,491,798
Net Assets:
Beginning of period 663,409,795 477,917,997
------------- -------------
End of period $ 881,740,692 $ 663,409,795
------------- -------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Fund
Financial Highlights--Institutional Shares
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months
Ended
(unaudited) Year Ended November 30,
May 31, ------------------------------------------------
1999 1998 1997 1996 1995 1994
- -----------------------------------------------------------------------------------------
<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
Income from investment
operations
Net investment income 0.02 0.05 0.05 0.05 0.06 0.04
Less distributions
Distributions from net
investment income (0.02) (0.05) (0.05) (0.05) (0.06) (0.04)
-------- -------- -------- -------- -------- --------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- --------
Total return (1) 2.32% 5.33% 5.37% 5.25% 5.75% 3.77%
Ratios to average net
assets
Expense (2) 0.62%(3) 0.64% 0.66% 0.69% 0.72% 0.78%
Net investment
income (2) 4.38%(3) 4.94% 4.96% 4.82% 5.27% 3.34%
Expenses (after
waivers) 0.38%(3) 0.38% 0.38% 0.37% 0.38% 0.38%
Net investment income
(after waivers) 4.62 %(3) 5.20% 5.24% 5.14% 5.61% 3.74%
Supplemental data
Net assets, end of
period (000 omitted) $334,548 $181,282 $157,438 $135,748 $126,042 $129,233
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(2) As a result of contractual obligations, certain fees were waived. If such
waivers had not occurred, the ratios would have been as indicated.
(3) Computed on an annualized basis.
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Fund
Financial Highlights--Investment Shares
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months
Ended
(unaudited) Year Ended November 30,
May 31, -----------------------------------------------
1999 1998 1997 1996 1995 1994
- ----------------------------------------------------------------------------------------
<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
Income from investment
operations
Net investment income 0.02 0.05 0.05 0.05 0.05 0.03
Less distributions
Distributions from net
investment income (0.02) (0.05) (0.05) (0.05) (0.05) (0.03)
-------- -------- -------- -------- -------- -------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- -------
Total return (1) 2.12% 4.92% 4.95% 4.83% 5.40% 3.46%
Ratios to average net
assets
Expense (2) 1.02%(3) 1.04% 1.06% 1.09% 1.12% 1.18%
Net investment
income (2) 3.98%(3) 4.54% 4.57% 4.42% 4.87% 2.94%
Expenses
(after waivers) 0.78%(3) 0.78% 0.78% 0.77% 0.72% 0.68%
Net investment income
(after waivers) 4.22%(3) 4.80% 4.85% 4.74% 5.27% 3.44%
Supplemental data
Net assets, end of
period (000 omitted) $547,193 $482,128 $320,480 $230,263 $165,636 $56,105
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. Results represent past
performance and do not guarantee future results.
(2) As a result of contractual obligations, certain fees were waived. If such
waivers had not occurred, the ratios would have been as indicated.
(3) Computed on an annualized basis.
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Fund
Notes to Financial Statements
May 31, 1999 (unaudited)
1. Organization
The Wachovia Funds (the "Trust") is registered under the Investment Company Act
of 1940, as amended (the "Act") as an open-end, management investment company.
The Trust consists of fourteen portfolios. The financial statements included
herein are only those of Wachovia Money Market Fund (the "Fund"), a diversified
portfolio. The financial statements of the other portfolios are presented
separately. The assets of each portfolio are segregated and a shareholder's
interest is limited to the portfolio in which shares are held. The Fund offers
two classes of shares: Institutional Shares and Investment Shares. Investment
Shares are identical in all respects to Institutional Shares except that
Investment Shares are sold pursuant to a distribution plan (the "Plan") adopted
in accordance with Rule 12b-1 under the Act. The investment objective of the
Fund is to provide income consistent with stability of principal and liquidity.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. These
policies are in conformity with generally accepted accounting principles.
Investment Valuations--The Fund uses the amortized cost method to value its
portfolio securities in accordance with Rule 2a-7 under the Act.
Repurchase Agreements--It is the policy of the Fund to require the custodian
bank to take possession, to have legally segregated in the Federal Reserve
Book Entry System, or to have segregated within the custodian bank's vault,
all securities held as collateral under repurchase agreement transactions.
Additionally, procedures have been established by the Fund to monitor, on a
daily basis, the market value of each repurchase agreement's collateral to
ensure that the value of collateral at least equals the repurchase price to be
paid under the repurchase agreement transaction.
The Fund will only enter into repurchase agreements with banks and other
recognized financial institutions, such as broker/dealers, which are deemed by
the Fund's adviser to be creditworthy pursuant to the guidelines and/or
standards reviewed or established by the Board of Trustees (the "Trustees").
Risks may arise from the potential inability of counterparties to honor the
terms of the repurchase agreement. Accordingly, the Fund could receive less
than the repurchase price on the sale of collateral securities.
Investment Income, Expenses and Distributions--Interest income and expenses
are accrued daily. Bond premium and discount, if applicable, are amortized as
required by the Internal Revenue Code, as amended (the "Code"). Distributions
to shareholders are recorded on the ex-dividend date.
Federal Taxes--It is the Fund's policy to comply with the provisions of the
Code applicable to regulated investment companies and to distribute to
shareholders each year substantially all of its income. Accordingly, no
provisions for federal tax are necessary.
When-Issued and Delayed Delivery Transactions--The Fund may engage in when-
issued or delayed delivery transactions. The Fund records when-issued
securities on the trade date and maintains security positions such that
sufficient liquid assets will be available to make payment for the securities
purchased. Securities purchased on a when-issued or delayed delivery basis are
marked to market daily and begin earning interest on the settlement date.
Use of Estimates--The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Fund
amounts of assets, liabilities, expenses and revenues reported in the
financial statements. Actual results could differ from those estimated.
Other--Investment transactions are accounted for on the trade date.
3. Shares of Beneficial Interest
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value) for each
class of shares. At May 31, 1999, capital paid-in aggregated $881,740,692.
Transactions in shares were as follows:
<TABLE>
<CAPTION>
Six Months Ended Year Ended
May 31, 1999 November 30, 1998
- ----------------------------------------------------------------------------
<S> <C> <C>
Institutional Shares
- -----------------------------------------
Shares sold 407,532,408 369,619,728
Shares redeemed (254,266,765) (345,776,210)
- ----------------------------------------- ------------ ------------
Net change resulting from Institutional
Shares transactions 153,265,643 23,843,518
------------ ------------
<CAPTION>
Six Months Ended Year Ended
May 31, 1999 November 30, 1998
- ----------------------------------------------------------------------------
<S> <C> <C>
Investment Shares
- -----------------------------------------
Shares sold 391,130,839 589,217,508
Shares issued to shareholders in payment
of distributions declared 294,005 568,441
Shares redeemed (326,359,590) (428,137,669)
- ----------------------------------------- ------------ ------------
Net change resulting from Investment
Shares transactions 65,065,254 161,648,280
------------ ------------
Net change resulting from Shares
transactions 218,330,897 185,491,798
------------ ------------
</TABLE>
4. Investment Advisory Fee and Other Transactions with Affiliates
Investment Advisory Fee--Wachovia Asset Management, the Fund's investment
adviser (the "Adviser"), receives for its services an annual investment advisory
fee equal to 0.50% of the Fund's average daily net assets. As a result of
contractual obligations, the Adviser may be required to waive a portion of its
fee. The Adviser can modify or terminate this waiver at its sole discretion
anytime after January 31, 2000.
Administrative Fee--Federated Services Company ("FServ") provides the Fund with
certain administrative personnel and services. This fee is based on the level of
average aggregate net assets of the Trust (excluding Wachovia Prime Cash
Management Fund) and The Wachovia Municipal Funds for the period. FServ may
voluntarily waive a portion of its fee. Prior to December 4, 1997, the
administrative fee during any fiscal year for the Funds aggregated at least
$75,000. After that date, FServ ceased imposing a minimum administrative fee.
Distribution Services Fee--The Fund has adopted a Distribution Plan (the "Plan")
pursuant to Rule 12b-1 under the Act. Under the terms of the Plan, the Fund will
compensate Federated Securities Corp. ("FSC"), the principal distributor, from
its net assets to finance activities intended to result in the sale of the
Fund's Investment Shares. The Plan provides that the Fund may incur distribution
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Fund
expenses up to 0.40% of the average daily net assets of its Investment Shares,
annually, to compensate FSC.
Transfer Agent and Dividend Disbursing Agent Fees--FServ, through its
subsidiary, Federated Shareholder Services Company ("FSSC") serves as transfer
and dividend disbursing agent for the Fund. The fee paid to FSSC is based on the
size, type, and number of accounts and transactions made by shareholders.
FSSC may voluntarily waive any portion of its fee.
Portfolio Accounting Fees--FServ, through its subsidiary, FSSC, maintains the
Fund's accounting records for which it receives a fee. The fee is based on the
level of the Fund's average daily net assets for the period, plus out-of-pocket
expenses.
Custodian Fees--Wachovia Bank, N.A. is the Fund's custodian for which it
receives a fee. The fee is based on the level of the Fund's average daily net
assets for the period, plus out-of-pocket expenses.
General--Certain of the Officers and Trustees of the Trust are Officers and
Directors or Trustees of the above companies.
5. Year 2000
Similar to other financial organizations, the Fund could be adversely affected
if the computer systems used by the Fund's service providers do not properly
process and calculate date-related information and data from and after January
1, 2000. The Fund's Adviser and administrator are taking measures that they
believe are reasonably designed to address the Year 2000 issue with respect to
computer systems that they use and to obtain reasonable assurances that
comparable steps are being taken by each of the Fund's other service providers.
At this time, however, there can be no assurance that these steps will be
sufficient to avoid any adverse impact to the Fund.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Trustees Officers
James A. Hanley John W. McGonigle
Samuel E. Hudgins President and Treasurer
J. Berkley Ingram, Jr. Charles L. Davis, Jr.
D. Dean Kaylor Vice President and Assistant
Alvin J. Schexnider Treasurer
Charles S. Way, Jr. Peter J. Germain
Secretary
Gail Cagney
Assistant Secretary
Mutual funds are not bank deposits or obligations, are not guaranteed by any
bank, and are not insured or guaranteed by the U.S. government, the Federal
Deposit Insurance Corporation, the Federal Reserve Board, or any other
government agency. Investment in mutual funds involves risk, including the
possible loss of principal.
This report is authorized for distribution to prospective investors only when
preceded or accompanied by the fund's prospectuses which contain facts
concerning its investment objective and policies, management fees, expenses and
other information.
Cusip 929901684
Cusip 929901304
Cusip 929901403
Cusip 929901833
Federated Securities Corp., Distributor Cusip 929901825
831-30 (7/99) G01144-04 (7/99)
