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 personal equity 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 Annual Report
November 30, 1999
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Wachovia Table of Contents
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<TABLE>
<S> <C>
President's Message 1
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Overview 5
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Wachovia Equity Fund Information 8
Line Graphs 8
Portfolio of Investments 11
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Wachovia Quantitative Equity Fund Information 13
Line Graphs 13
Portfolio of Investments 16
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Wachovia Growth and Income Fund Information 18
Line Graphs 18
Portfolio of Investments 20
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Wachovia Equity Index Fund Information 22
Line Graphs 22
Portfolio of Investments 24
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Wachovia Special Values Fund Information 31
Line Graphs 31
Portfolio of Investments 34
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Wachovia Emerging Markets Fund Information 37
Line Graphs 37
Portfolio of Investments 39
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Wachovia Personal Equity Fund Information 44
Line Graphs 44
Portfolio of Investments 46
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Wachovia Balanced Fund Information 48
Line Graphs 48
Portfolio of Investments 51
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Wachovia Fixed Income Fund Information 56
Line Graphs 56
Portfolio of Investments 59
</TABLE>
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<TABLE>
<S> <C>
Wachovia Intermediate Fixed Income Fund Information 66
Line Graphs 66
Portfolio of Investments 68
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Wachovia Short-Term Fixed Income Fund Information 71
Line Graphs 71
Portfolio of Investments 73
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Wachovia Georgia Municipal Bond Fund Information 74
Line Graphs 74
Portfolio of Investments 76
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Wachovia North Carolina Municipal Bond Fund Information 81
Line Graphs 81
Portfolio of Investments 83
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Wachovia South Carolina Municipal Bond Fund Information 92
Line Graphs 92
Portfolio of Investments 94
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Wachovia Virginia Municipal Bond Fund Information 107
Line Graphs 107
Portfolio of Investments 109
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Notes to Portfolio of Investments 117
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Statements of Assets and Liabilities 118
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Statements of Operations 121
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Statements of Changes in Net Assets 124
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Financial Highlights--Class A Shares 130
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Financial Highlights--Class B Shares 134
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Financial Highlights--Class Y Shares 136
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Combined Notes to Financial Statements 138
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Auditors Report 154
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Officer and Trustees Table 155
</TABLE>
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President's Message
Dear Shareholder:
I am pleased to present the Combined Annual Report to Shareholders for The
Wachovia Funds and The Wachovia Municipal Funds. This Report covers the 12-month
period from December 1, 1998 through November 30, 1999, and includes commentary
by portfolio management, a complete list of fund holdings and the fund's
financial statements. The following fund-by-fund highlights cover performance
activity in Class A Shares, Class B Shares, and Class Y Shares. It was a
continued positive environment for stocks, while bond returns were weak due to
the negative impact of rising interest rates. I urge you to read the portfolio
manager commentary for additional information about your fund's performance.
Fund-by fund performance highlights are as follows. The Wachovia Funds Wachovia
Equity Fund pursues growth through a portfolio of blue-chip stocks issued by
some of America's largest and best-known companies. In particular, the fund's
manager seeks stocks issued by companies that are both undervalued and have good
growth opportunities. At the end of the reporting period, the fund's extensive
stock holdings included such well-known names as AT&T, American Express, DuPont,
Exxon, General Electric, Intel, Microsoft, Time Warner and Wal-Mart. Fund net
assets reached $351.8 million at the end of the reporting period.
<TABLE>
<CAPTION>
Total Return* Income Capital Gains
Based on NAV Distributions Distributions Share Price Change
------------- ------------- ------------- ------------------
<S> <C> <C> <C> <C>
Class A Share 24.31% $0.07 $1.89 $15.91 to $17.42
Class B Shares 23.37% $0.00** $1.89 $15.87 to $17.32
Class Y Shares 24.52% $0.11 $1.89 $15.92 to $17.42
</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 portfolio
included quality names like Anheuser-Busch, DuPont, Ford, Home Depot, Intel,
J.P. Morgan, Merck, Pepsi Co, Procter & Gamble, and Sprint. Fund net assets
ended the reporting period at $712.2 million.
<TABLE>
<CAPTION>
Total Return* Income Capital Gains
Based on NAV Distributions Distributions Share Price Change
------------- ------------- ------------- ------------------
<S> <C> <C> <C> <C>
Class A Shares 16.60% $0.11 $2.43 $20.29 to $21.00
Class B Shares 15.85% $0.00 $2.43 $20.23 to $20.91
Class Y Shares 16.97% $0.16 $2.43 $20.31 to $21.04
</TABLE>
Wachovia Growth and 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 America Online, AT&T, Bank of America, Colgate-Palmolive, General
Motors, IBM, Johnson & Johnson, and Wal-Mart. Fund net assets totaled $349.6
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 20.40% $0.08 $2.89 $23.54 to $24.86
Class Y Shares 20.73% $0.14 $2.89 $23.55 to $24.88
</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 a "who's who" of
well-known, quality American companies. Fund net assets increased substantially
to reach $544.6 million at the end of the reporting period.
<TABLE>
<CAPTION>
Total Return* Income Capital Gains
Based on NAV Distributions Distributions Share Price Change
------------- ------------- ------------- ------------------
<S> <C> <C> <C> <C>
Class A Shares 19.97% $0.26 $0.37 $22.41 to $26.18
Class Y Shares 20.24% $0.32 $0.37 $22.44 to $26.21
</TABLE>
*Performance quoted represents past performance and is no guarantee of future
results. Investment return and principal value will fluctuate, so that an
investor's shares, when redeemed, may be worth more or less than their
original cost.
**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. The fund's positive returns reflected an
improved environment for small cap stocks. At the end of the reporting period,
the fund's net assets reached $175.7 million. Class B Shares performance is from
March 26, 1999, when it began operation, through November 30, 1999.
<TABLE>
<CAPTION>
Total Return** Income Capital Gains
Based on NAV Distributions Distributions Share Price Change
-------------- ------------- ------------- ------------------
<S> <C> <C> <C> <C>
Class A Shares 5.40% $0.16 $0.75 $16.13 to $16.03
Class B Shares 9.52% $0.00 $0.00 $14.60 to $15.99
Class Y Shares 5.61% $0.20 $0.75 $16.18 to $16.07
</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 use 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. The fund's strong returns reflect a positive
environment for international stocks. Fund net assets ended the reporting period
at $194.4 million. <TABLE> <CAPTION>
Total Return** Income
Based on NAV Distributions Share Price Change
-------------- ------------- ------------------
<S> <C> <C> <C>
Class A Shares 40.07% $0.05 $8.43 to $11.74
Class Y Shares 40.39% $0.07 $8.44 to $11.75
</TABLE>
Wachovia Personal Equity Fund, the latest addition to the Wachovia Funds,
pursues growth of principal and income by investing in a portfolio of high
quality companies. This fund is specifically managed to minimize the unpleasant
tax consequence of capital gains distributions through a long-term, buy-and-hold
strategy that avoids short-term trading, as well as offsetting or minimizing
capital gains by selling securities that have declined in value, have the
highest cost basis, or have not met expectations for growth. Fund net assets
ended the reporting period at $444.6 million. The following performance is for
the period from July 30, 1999, when the fund began operation, through November
30, 1999. <TABLE> <CAPTION>
Total Return** Income
Based on NAV Distributions Share Price Change
-------------- ------------- ------------------
<S> <C> <C> <C>
Class A Shares 6.75% $0.01 $10.00 to $10.67
Class Y Shares 6.85% $0.01 $10.00 to $10.68
</TABLE>
Wachovia Balanced Fund pursues a popular investment objective--long-term growth
and current income--by investing in a quality combination of stocks (60.5% of
net assets at the end of the reporting period) and bonds. Bond holdings were
diversified across corporate bonds (14.9% of net assets), mortgage-backed
securities (13.2% of net assets), U.S. Treasury securities (7.7% of net assets),
closed end investment companies (1.8%) and a repurchase agreement (1.5%). At the
end of the reporting period, fund assets totaled $650.6 million.
<TABLE>
<CAPTION>
Total Return** Income Capital Gains
Based on NAV Distributions Distributions Share Price Change
-------------- ------------- ------------- ------------------
<S> <C> <C> <C> <C>
Class A Shares 13.95% $0.31 $1.69 $13.72 to $13.45
Class B Shares 13.08% $0.21 $1.69 $13.69 to $13.41
Class Y Shares 14.21% $0.34 $1.69 $13.74 to $13.47
</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 $558.3 million in net assets were invested across
government agency securities (39.0%), corporate bonds (26.1%), U.S. Treasury
obligations (12.7%), closed-end investment companies (7.3%), asset-backed
securities (7.3%), collateralized mortgage obligations (1.9%), foreign bonds
(1.9%), a repurchase agreement (1.3%), and corporate notes (1.3%).
<TABLE>
<CAPTION>
Total Return** Income Capital Gains
Based on NAV Distributions Distributions Share Price Change
-------------- ------------- ------------- ------------------
<S> <C> <C> <C> <C>
Class A Shares (0.77%) $0.51 $0.04 $10.14 to $9.52
Class B Shares (1.51%) $0.43 $0.04 $10.14 to $9.52
Class Y Shares (0.53%) $0.53 $0.04 $10.14 to $9.52
</TABLE>
*Small cap stocks have historically experienced greater volatility than
average.
** Performance quoted represents past performance and is no guarantee of
future results. Investment return and principal value will fluctuate, so
that an investor's shares, when redeemed, may be worth more or less than
their original cost.
*** 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 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
$141.7 million in net assets was invested across U.S. government agency
securities (32.8%), corporate bonds (32.4%), U.S. Treasury obligations (16.7%),
asset-backed securities (6.7%), closed-end investment companies (5.9%),
collateralized mortgage obligations (1.3%), and a repurchase agreement (2.9%).
<TABLE>
<CAPTION>
Total Return* Capital Gains
Based on NAV Income Distributions Share Price Change
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<S> <C> <C> <C> <C>
Class A Shares (1.03%) $0.50 $0.20 3$10.38 to $9.57
Class Y Shares (0.77%) $0.53 $0.20 $10.38 to $9.57
</TABLE>
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 (35.7% of net assets), U.S. government agency
obligations, (20.6% of net assets), U.S. Treasury obligations (25.4% of net
assets). These short-term, income-producing securities are managed to provide an
income stream and cushion shareholders against volatility during periods of
interest rate increases. Net assets totaled $48.7 million on the last day of the
reporting period.
<TABLE>
<CAPTION>
Total Return* Income
Based on NAV Distributions Share Price Change
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<S> <C> <C> <C>
Class A Shares 2.44% $0.52 $9.92 to $9.63
Class Y Shares 2.70% $0.55 $9.92 to $9.63
</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. Total net assets reached $114.2
million on the last day of the reporting period.
<TABLE>
<CAPTION>
Total Return* Income Capital Gains
Based on NAV Distributions Distributions Share Price Change
------------- ------------- ------------- ------------------
<S> <C> <C> <C> <C>
Class A Shares (2.83%) $0.43 $0.03 $11.38 to $10.61
Class Y Shares (2.59%) $0.45 $0.03 $11.38 to $10.61
</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 net assets of $443.2 million were invested in
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* Income Capital Gains
Based on NAV Distributions Distributions Share Price Change
------------- ------------- ------------- ------------------
<S> <C> <C> <C> <C>
Class A Shares (2.34%) $0.42 $0.06 $11.46 to $10.72
Class Y Shares (2.09%) $0.45 $0.06 $11.46 to $10.72
</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 municipalities across South Carolina
that are rated A or higher at the time of purchase by nationally recognized
rating agencies. Total net assets reached $348.5 million at the reporting
period's end.
<TABLE>
<CAPTION>
Total Return* Income Capital Gains
Based on NAV Distributions Distributions Share Price Change
------------- ------------- ------------- ------------------
<S> <C> <C> <C> <C>
Class A Shares (2.49%) $0.50 $0.02 $11.36 to $10.57
Class Y Shares (2.24%) $0.52 $0.02 $11.36 to $10.57
</TABLE>
*Performance quoted represents past performance and is no guarantee of future
results. Investment return and principal value will fluctuate, so that an
investor's shares, when redeemed, may be worth more or less than their original
cost.
+Income may be subject to the federal alternative minimum tax.
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
at the time of purchase by nationally recognized rating agencies. Total net
assets reached $137.5 million at the period's end.
<TABLE>
<CAPTION>
Total Return* Income
Based on NAV Distributions Share Price Change
------------- ------------- ------------------
<S> <C> <C> <C>
Class A Shares (2.01%) $0.45 $10.49 to $9.84
Class Y Shares (1.76%) $0.47 $10.49 to $9.84
</TABLE>
Thank you for pursuing your financial goals through the diversification and
professional management of the Wachovia Funds. As we begin a new millennium, we
renew our commitment to keep you up-to-date on your investment progress through
the highest level of service. Sincerely, [logo] John W. McGonigle President
January 15, 2000
*Performance quoted represents past performance and is no guarantee of future
results. Investment return and principal value will fluctuate, so that an
investor's shares, when redeemed, may be worth more or less than their original
cost.
+Income may be subject to the federal alternative minimum tax.
Total returns for the period adjusted for the sales charge (Class A Shares) or
deferred sales charge (Class B Shares) are as follows:
Wachovia Equity Fund, Class A Shares, 18.71%; Class B Shares, 18.37% Wachovia
Quantitative Equity Fund, Class A Shares, 11.33%; Class B Shares, 10.85%
Wachovia Growth & Income Fund, Class A Shares, 14.98% Wachovia Equity Index
Fund, Class A Shares, 14.56% Wachovia Special Values Fund, Class A Shares,
0.66%; Class B Shares, 4.52% Wachovia Emerging Markets Fund, Class A Shares,
33.72% Wachovia Personal Equity Fund, Class A Shares, 1.96% Wachovia Balanced
Fund, Class A Shares, 8.80%; Class B Shares, 8.18% Wachovia Fixed Income Fund,
Class A Shares, (5.26%); Class B Shares, (6.21%) Wachovia Intermediate Fixed
Income Fund, Class A Shares, (5.50%) Wachovia Short-Term Fixed Income Fund,
Class A Shares, (0.08%) Wachovia Georgia Municipal Bond Fund, Class A Shares,
(7.23%) Wachovia North Carolina Municipal Bond Fund, Class A Shares, (6.73%)
Wachovia South Carolina Municipal Bond Fund, Class A Shares, (6.91%) Wachovia
Virginia Municipal Bond Fund, Class A Shares, (6.38%)
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Overview
Equity Market
Markets around the world experienced solid returns during 1999 as the revival of
Asian economies and the arrival of the euro contributed to growth overseas. In
the U.S., the Standard & Poor's 500 Index Common Stocks (the "S&P 500")*
delivered a total return in excess of 20 percent for the fifth consecutive
year--the first time in history such a streak has continued for such a long
period of time. The NASDAQ Composite Index (the "NASDAQ Composite")**, dominated
by large technology names, performed very well, returning in excess of 85
percent for the year. The growth style of investing outperformed value investing
for the fifth consecutive year as investors continued to focus on innovative
companies that deliver on the promise of accelerating growth despite interest
rate concerns. Large-capitalization names performed better, on average, than
small-cap issues, with the very largest companies delivering the best
performances. Only the top two market capitalization deciles delivered results
that were higher than the index as a whole, highlighting the fact that the
larger companies drove performance. On a sector basis, those S&P 500 sectors
that were heavily leveraged to the new knowledge economy delivered exceptional
results, while the growth sectors of past years (consumer staples and health
care, in particular) struggled with slowing revenue growth and political
uncertainties.
Wachovia Equity Fund Shareholder:
The Wachovia Equity Fund outperformed the benchmark S&P 500 Index behind strong
stock selection, especially in technology, financials, and utilities. The
technology sector focused on Internet infrastructure, including companies
leveraged to bandwidth, storage, and servers. The Fund's financial sector
holdings benefited from strong earnings gains and an improving global economy.
Despite the rising interest rates, questionable mergers, and warmer weather that
drove the utilities index downward, the Fund's stocks performed well.
Wachovia Quantitative Equity Fund Shareholder:
The Wachovia Quantitative Equity Fund underperformed the benchmark S&P 500 Index
in 1999. The increase in the market's volatility more negatively impacted the
Fund's stock selection with the value-oriented factors than with the
growth-oriented factors. While the index returns were impressive, the lack of
market breadth was nearly unprecedented in 1999. The Fund's sector neutral
approach weighed down the total return as four of the eleven S&P 500 Sector
indices (Health, Transports, Utilities, and Consumer Staples) suffered
substantial declines for the year, and were only partially offset with the
outperformance in the Technology and Communication Services sectors. The
quantitative model has clearly provided discrimination between the best and
worst performing stocks over the long term. The Fund's returns should more
closely track the market's returns as the breadth widens and the volatility
subsides with more rational valuations.
Wachovia Growth & Income Fund Shareholder:
The Wachovia Growth and Income Fund returned 23.5 percent in 1999, outperforming
the S&P 500 by nearly three percentage points. The fund benefited substantially
from strong returns in the financial and technology sectors. The Fund's
technology sector holdings focused primarily on Internet infrastructure,
including companies leveraged to bandwidth, storage, and servers. The Fund's
financial sector holdings benefited from strong earnings gains and an improving
global economy.
* The S&P 500 is a composite index of common stocks in industry,
transportation, and financial and public utility companies. In addition, the
S&P 500 assumes reinvestment of all dividends paid by stocks listed on the
index. Taxes due on any of the distributions are not included, nor are
brokerage or other fees calculated in index figures. Investments cannot be
made in an index.
** NASDAQ Composite is an unmanaged index that measures all NASDAQ domestic and
non-U.S.-based common stocks listed on the NASDAQ Stock Market.
Investments cannot be made in an index.
Wachovia Equity Index Fund Shareholder:
While the equity market performed strongly in 1999, the breadth of the market
was narrow, with the larger capitalization companies driving market performance.
This pronounced capitalization effect saw the largest 100 companies in the S&P
500 Index significantly outperforming the rest of the market. Growth-style
investing outperformed value investing, and those sectors that were connected
with the technology based knowledge economy significantly outperformed the
growth sectors of past years such as consumer staples and health care. The
transportation and utilities sectors struggled with rising oil prices, higher
interest rates, and a number of other difficulties.
Wachovia Special Values Fund Shareholder:
Similar to bio-tech companies of the early 1990's, a promising new profitless
corner of the equity market captured investor enthusiasm and attracted capital
to the small-cap arena. The IPO market responded with an increasing number of
offerings as investor money followed performance. In fact, the result was a
record year in the IPO market, with nearly $80 billion being raised. Although
the benchmark Russell 2000 Index* posted respectable returns for the year, over
half of the stocks currently in the Index are down for the year, with one-fourth
being down 30 percent or more. Extraordinary performance by a narrow leadership
of names explains the divergence. The Special Values Fund's performance
experienced a similar phenomenon, with performance being driven by a relatively
small number of names in semiconductors and energy. A cyclical semiconductor
rebound and higher oil prices helped fuel returns in these sectors and benefited
the Fund substantially. In addition, media/entertainment companies fared well as
the group's assets garnered increased investor attention. Value investing rests
on the premise of holding businesses that are believed to be trading well below
their perceived fair market value. Strong returns occur when other investors
realize that a company is, indeed, undervalued. This realization can occur
through increased merger/acquisition activity or simply when a stock is
discovered in the marketplace and its price rises. Although 1999 was not a year
of significant discovery and value realization, the fund did experience a
substantial amount of merger activity that benefited performance, with twelve
portfolio holdings undergoing merger/acquisition activity.
Wachovia Emerging Markets Fund Shareholder:
The market recovery that began in the fourth quarter of 1998 continued
throughout 1999. Prompt actions taken during the year by central bankers around
the globe helped to avert a global recession and formed the basis for the
impressive resurgence of emerging markets in 1999. Investor confidence in a
growth world economy allowed commodity prices to stabilize and improve, thereby
improving the export picture for many emerging countries that had been hit hard
by the falling prices of raw materials. The high interest rates that were
necessary to defend the value of many currencies began to decline and took
pressure off of local economies. Furthermore, the positive side of currency
weakness began to show in the improved competitiveness of many industries in
global export markets, thus turning what were once trade deficits into trade
surpluses. The return of capital flows to these countries meant that many
emerging market currencies ultimately strengthened from their undervalued
levels, adding significantly to U.S. dollar returns. The Wachovia Emerging
Markets Fund performed well during the year despite employing a style that
appeared to be out of favor. The fund employs a unique style that emphasizes
portfolio diversification, controlling risk by limiting the exposure to any
single market to a maximum of ten percent of the portfolio. The net effect of
this approach is to have less exposure to the largest markets and more exposure
to the smaller markets. In a year in which larger emerging markets outperformed
the smaller ones, the fund allocated close to maximum levels in most of the
larger markets such as South Korea and Mexico, while getting very strong
performance from overweight positions in smaller markets such as Russia and
Turkey. The result was performance that was competitive with the averages, while
staying true to a style that recognizes that investing heavily in any single
emerging market can exceed our clients' risk tolerance.
Wachovia Personal Equity Fund Shareholder:
The Wachovia Personal Equity Fund was officially launched in August 1999. In its
initial stages, the Fund's returns have been driven by strong stock selection in
the technology, financial, and utilities sectors. The Fund's technology sector
holdings focused primarily on Internet infrastructure, including companies
leveraged to bandwidth, storage, and servers, while its financial sector
holdings benefited from strong earnings gains and an improving global economy.
Despite an environment of rising interest rates, questionable mergers, and
warmer weather that drove the utilities index downward, the Fund's utilities
holdings performed well.
* The Russell 2000 Index is a broadly diversified index consisting of
approximately 2,000 capitalization common stocks that can be used to compare
the total returns of funds whose portfolios are invested primarily in small
capitalization common stocks. Investments cannot be made in an index.
Wachovia Balanced Fund Shareholder:
The Wachovia Balanced significantly outperformed the Lipper Balanced Funds
Average, returning 15.05 percent for the year compared to the Lipper Average
return of 8.69 percent. Allocation remained relatively stable throughout the
year, with approximately 59 percent in equities, 40 percent in fixed income
securities, and a 1 percent cash position.
Fixed Income Market
With regard to the fixed income component of the fund's portfolio, interest
rates increased steadily over the course of 1999, moving higher in ten out of
twelve months during the year. Long-term treasuries recorded their worst
absolute performance since the government began auctioning them almost 22 years
ago. The corporate bond market experienced a year of improving liquidity,
generally stable spreads, and higher new issue volume. Most of the 10 percent
1999 increase in corporate volume was over by the end of the 3rd quarter as
companies locked in financing before the Y2K conversion. The mortgage market was
the best performing major sector in the Lehman Brothers Aggregate Bond Index*,
and the only sector to record an absolute positive return for the year, while
spreads improved with declining prepayment risk and rising rates. Agency sector
spreads ended the year approximately where they began 1999. Allocation remained
relatively stable throughout the year, with 59 percent in equities, 40 percent
in fixed income securities, and a 1 percent cash position.
Wachovia Fixed Income Fund Shareholder:
Interest rates increased steadily over the course of 1999, moving higher in ten
out of twelve months during the year. Long-term treasuries recorded their worst
absolute performance since the government began auctioning them almost 22 years
ago. The corporate bond market experienced a year of improving liquidity,
generally stable spreads, and higher new issue volume. Most of the 10 percent
1999 increase in corporate volume was over by the end of the 3rd quarter as
companies locked in financing before the Y2K conversion. The mortgage market was
the best performing major sector in the Lehman Brothers Aggregate Bond Index*,
and the only sector to record an absolute positive return for the year, while
spreads improved with declining prepayment risk and rising rates. Agency sector
spreads ended the year approximately where they began 1999.
Wachovia Intermediate Fixed-Income Fund/Short Term Fixed Income Fund
Shareholders: For securities maturing inside of 5 years, interest rates
increased by 0.60 percent for the 4th quarter of 1999 and 1.75 percent for the
year. In fact, rates increased in 10 out of 12 months for 1999, which was driven
by strong domestic economic activity, an Asian economic rebound, higher
commodity prices, and three Federal Reserve rate increases. Corporate bond
yields increased by roughly the same amount as Treasuries and still appear
attractive on a relative basis. The expectation is for at least 0.50 percent
rate increase by the Fed in the 1st quarter of 2000, and if economic activity
remains strong then more rate hikes could follow.
Municipal Bond Market
Wachovia Georgia Municipal Bond Fund
Wachovia North Carolina Municipal Bond Fund
Wachovia South Carolina Municipal Bond Fund
Wachovia Virginia Municipal Bond Fund
The municipal market in 1999 was characterized by a nearly uninterrupted rise in
interest rates, the unfortunate consequence being a seemingly relentless decline
in bond prices. Early in the year the fund's portfolio manager anticipated a
rising interest rate environment and endeavored to respond by taking defensive
measures early and often. Primarily, efforts were made to sell longer dated,
lower coupon bonds to reinvest into shorter dated, higher coupon bonds. The
objective of repositioning the fund into higher income, more defensive bonds was
accomplished. Additionally, the fund manager sought to improve credit quality by
generally selling lesser quality bonds and replacing them with better quality
bonds. These measures served the fund well in the face of a bond year arguably
as difficult as any experienced in the past twenty years.
* The Lehman Brothers Aggregate Bond Index (LBABI) is an unmanaged index
measuring both the capital price changes and income provided by the
underlying universe of securities, comprised of U.S. Treasury obligations,
U.S. agency obligations, foreign obligations, U.S. investment-grade
corporate debt and mortgage-backed obligations. The LBABI is not adjusted
to reflect sales charges, expenses, or other fees that the SEC requires to
be reflected in the Fund's performance. Investments cannot be made in an
index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Equity Fund (Class A Shares)
Growth of $10,000 Invested in Wachovia Equity Fund (Class A Shares) The
graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Equity Fund (Class A Shares) (the "Fund") from May 7, 1993 (start of
performance) to November 30, 1999 compared to the Standard and Poor's 500 Index
(S&P 500).+
[Please see Appendix A1]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund after deducting
the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge
= $9,550). The Fund's performance assumes the reinvestment of all dividends
and distributions. The S&P 500 has been adjusted to reflect reinvestment of
dividends on securities in the index.
** Total returns quoted reflect all applicable sales charges and contingent
deferred sales charges.
+ The S&P 500 is an unmanaged index comprised of common stocks in industry,
transportation, and financial and public utility companies. The S&P 500 is
not adjusted to reflect sales charges, expenses, or other fees that the SEC
requires to be reflected in the Fund's performance. Investments cannot be
made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Equity Fund (Class B Shares)
Growth of $10,000 Invested in Wachovia Equity Fund (Class B Shares) The
graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Equity Fund (Class B Shares) (the "Fund") from July 23, 1996 (start of
performance) to November 30, 1999 compared to the Standard and Poor's 500 Index
(S&P 500).+
[Please see Appendix A2]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund. The ending value
reflects a 3.00% contingent deferred sales charge on any redemption less than
four years from the purchase date. The maximum contingent deferred sales
charge is 5.00% on any redemption less than one year from the purchase date.
The Fund's performance assumes the reinvestment of all dividends and
distributions. The S&P 500 has been adjusted to reflect reinvestment of
dividends on securities in the index.
** Total returns quoted reflect all applicable sales charges and contingent
deferred sales charges.
+ The S&P 500 is an unmanaged index comprised of common stocks in industry,
transportation, and financial and public utility companies. The S&P 500 is
not adjusted to reflect sales charges, expenses, or other fees that the SEC
requires to be reflected in the Fund's performance. Investments cannot be
made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Equity Fund (Class Y Shares)
Growth of $10,000 Invested in Wachovia Equity Fund (Class Y Shares) The
graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Equity Fund (Class Y Shares) (the "Fund") from July 23, 1996 (start of
performance) to November 30, 1999 compared to the Standard and Poor's 500 Index
(S&P 500).+
[Please see Appendix A3]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* The Fund's performance assumes the reinvestment of all dividends and
distributions. The S&P 500 has been adjusted to reflect reinvestment of
dividends on securities in the index.
+ The S&P 500 is an unmanaged index comprised of common stocks in industry,
transportation, and financial and public utility companies. The S&P 500 is not
adjusted to reflect sales charges, expenses, or other fees that the SEC
requires to be reflected in the Fund's performance. Investments cannot be made
in an index.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Equity Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Shares Value
- ----------------------------------------------------------------------------
<C> <S> <C>
Common Stocks--83.8%
Basic Materials--3.4%
34,171 Air Products & Chemicals, Inc. $ 1,106,286
23,975 Alcoa, Inc. 1,570,363
11,161 Dow Chemical Co. 1,307,231
15,876 Du Pont (E.I.) de Nemours & Co. 943,630
49,279 Rohm & Haas Co. 1,804,843
84,425 Weyerhaeuser Co. 5,171,031
------------
Total 11,903,384
------------
Capital Goods--5.6%
65,974 General Electric Co. 8,576,620
38,388 Ingersoll-Rand Co. 1,859,419
125,366 Tyco International Ltd. 5,022,475
72,649 United Technologies Corp. 4,104,669
------------
Total 19,563,183
------------
Communication Services--5.6%
101,413 AT&T Corp. 5,666,451
115,178 (1)MCI Worldcom, Inc. 9,523,781
33,121 (1)Nextel Communications, Inc., Class A 3,283,119
24,020 Vodafone AirTouch PLC, ADR 1,133,444
------------
Total 19,606,795
------------
Consumer Cyclicals--5.2%
54,446 Black & Decker Corp. 2,443,264
41,907 Carnival Corp. 1,849,146
18,471 (1)Federated Department Stores, Inc. 869,291
51,997 Lowe's Cos., Inc. 2,590,101
51,327 McGraw-Hill Cos., Inc. 2,909,598
38,917 Nordstrom, Inc. 1,082,379
24,384 Tandy Corp. 1,868,424
81,405 Wal-Mart Stores, Inc. 4,690,963
------------
Total 18,303,166
------------
Consumer Staples--8.0%
64,737 (1)AT&T Corp.-Liberty Media Group, Inc., Class A 2,706,816
73,252 CBS Corp. 3,809,104
93,557 CVS Corp. 3,713,043
39,053 (1)Clear Channel
Communications, Inc. 3,138,885
80,922 Comcast Corp., Class A 3,656,662
185,889 (1)Kroger Co., Inc. 3,961,759
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
Common Stocks--continued
Consumer Staples--continued
96,775 (1)Outback Steakhouse, Inc. $ 2,280,261
78,352 Time Warner, Inc. 4,833,339
------------
Total 28,099,869
------------
Energy--4.9%
53,638 BP Amoco PLC, ADR 3,268,566
61,090 Baker Hughes, Inc. 1,542,523
129,792 Conoco, Inc., Class A 3,415,152
68,635 Exxon Corp. 5,443,613
34,494 Schlumberger Ltd. 2,071,796
25,988 Texaco, Inc. 1,583,644
------------
Total 17,325,294
------------
Finance--14.0%
37,505 American Express Co. 5,674,975
12,166 American General Corp. 891,920
65,061 American International
Group, Inc. 6,717,548
17,753 Associates First Capital Corp., Class A 590,287
42,285 Bank One Corp. 1,490,546
65,852 Bank of America Corp. 3,852,342
30,577 Bank of New York Co., Inc. 1,219,258
41,533 Chase Manhattan Corp. 3,208,424
159,211 Citigroup, Inc. 8,577,493
27,092 Fannie Mae 1,805,005
55,522 Freddie Mac 2,741,399
21,865 First Union Corp. 845,902
25,255 MBIA, Inc. 1,262,750
55,897 MBNA Corp. 1,411,399
19,138 Marsh & McLennan Cos., Inc. 1,504,725
14,472 Merrill Lynch & Co., Inc. 1,166,805
37,942 SunTrust Banks, Inc. 2,651,197
82,463 Wells Fargo Co. 3,834,530
------------
Total 49,446,505
------------
Healthcare--9.1%
31,854 Abbott Laboratories 1,210,452
28,228 (1)Amgen, Inc. 1,286,138
69,230 Bristol-Myers Squibb Co. 5,058,117
16,402 Guidant Corp. 820,100
59,630 Johnson & Johnson 6,186,613
33,701 Lilly (Eli) & Co. 2,418,047
54,996 Medtronic, Inc. 2,137,970
59,004 Merck & Co., Inc. 4,631,814
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Equity Fund
<TABLE>
<CAPTION>
Shares Value
- -------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Healthcare--continued
101,676 Pfizer, Inc. $ 3,679,400
17,856 Pharmacia & Upjohn, Inc. 976,500
16,764 Schering Plough Corp. 857,060
30,183 Warner-Lambert Co. 2,707,038
------------
Total 31,969,249
------------
Technology--24.0%
70,176 (1)America Online, Inc. 5,100,918
126,230 (1)Cisco Systems, Inc. 11,258,138
2 Computer Associates International, Inc. 130
81,674 (1)EMC Corp. 6,824,884
80,808 Intel Corp. 6,196,964
42,315 International Business
Machines Corp. 4,361,090
35,116 (1)JDS Uniphase Corp. 8,032,785
71,535 Lucent Technologies, Inc. 5,226,526
108,726 (1)Microsoft Corp. 9,899,163
25,030 (1)Network Appliance, Inc. 2,945,718
22,292 Nokia Oyj, Class A, ADR 3,080,476
70,233 (1)Sun Microsystems, Inc. 9,288,314
61,420 Texas Instruments, Inc. 5,900,159
71,501 (1)Veritas Software Corp. 6,546,810
------------
Total 84,662,075
------------
Transportation--1.0%
37,866 Burlington Northern Santa Fe 1,098,114
148,700 Southwest Airlines Co. 2,425,661
------------
Total 3,523,775
------------
</TABLE>
<TABLE>
<CAPTION>
Shares or
Principal
Amount Value
<C> <S> <C>
Common Stocks--continued
Utilities--3.0%
24,736 Burlington Resources, Inc. $ 831,748
36,517 Consolidated Edison Co. 1,259,837
65,538 Duke Energy Corp. 3,321,957
72,078 Enron Corp. 2,743,469
102,366 Southern Co. 2,392,806
------------
Total 10,549,817
------------
Total Common Stocks
(identified cost $200,599,010) 294,953,112
------------
U.S.Government Agency--5.7%
$20,000,000 (2)Federal National Mortgage Association, Discount
Note, 12/10/1999 (identified cost $19,973,700) 19,973,700
------------
U.S. Treasury Obligation--0.9%
3,100,000 (2)United States Treasury Bill, 12/16/1999
(identified cost $3,094,020) 3,094,020
------------
Repurchase Agreement (3)--9.7%
34,173,073 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999,
due 12/1/1999 (at amortized cost) 34,173,073
------------
Total Investments
(identified cost $257,839,803) $352,193,905
------------
</TABLE>
(See Notes to Portfolios of Investments)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Quantitative Equity Fund (Class A Shares)
Growth of $10,000 Invested in Wachovia Quantitative Equity Fund (Class A
Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Quantitative Equity Fund (Class A Shares) (the "Fund") from March 25,
1994 (start of performance) to November 30, 1999 compared to the Standard and
Poor's 500 Index (S&P 500).+
[Please see Appendix A4]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund after deducting
the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge
= $9,550). The Fund's performance assumes the reinvestment of all dividends
and distributions. The S&P 500 has been adjusted to reflect the reinvestment
of dividends on securities in the index.
** Total returns quoted reflect all applicable sales charges and contingent
deferred sales charges.
+ The S&P 500 is an unmanaged index comprised of common stocks in industry,
transportation, and financial and public utility companies. The S&P 500 is
not adjusted to reflect sales charges, expenses, or other fees that the SEC
requires to be reflected in the Fund's performance. Investments cannot be
made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Quantitative Equity Fund (Class B Shares)
Growth of $10,000 Invested in Wachovia Quantitative Equity Fund (Class B
Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Quantitative Equity Fund (Class B Shares) (the "Fund") from July 23,
1996 (start of performance) to November 30, 1999 compared to the Standard and
Poor's 500 Index (S&P 500).+
[Please see Appendix A5]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund. The ending value
of the Fund reflects a 3.00% contingent deferred sales charge on any
redemption less than four years from the purchase date. The maximum
contingent deferred sales charge is 5.00% on any redemption less than one
year from the purchase date. The Fund's performance assumes the reinvestment
of all dividends and distributions. The S&P 500 has been adjusted to reflect
the reinvestment of dividends on securities in the index.
** Total returns quoted reflect all applicable sales charges and contingent
deferred sales charges.
+ The S&P 500 is an unmanaged index comprised of common stocks in industry,
transportation, and financial and public utility companies. The S&P 500 is
not adjusted to reflect sales charges, expenses, or other fees that the SEC
requires to be reflected in the Fund's performance. Investments cannot be
made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Quantitative Equity Fund (Class Y Shares)
Growth of $10,000 Invested in Wachovia Quantitative Equity Fund (Class Y
Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Quantitative Equity Fund (Class Y Shares) (the "Fund") from July 23,
1996 (start of performance) to November 30, 1999 compared to the Standard and
Poor's 500 Index (S&P 500).+
[Please see Appendix A6]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* The Fund's performance assumes the reinvestment of all dividends and
distributions. The S&P 500 has been adjusted to reflect the reinvestment of
dividends on securities in the index.
+ The S&P 500 is an unmanaged index comprised of common stocks in industry,
transportation, and financial and public utility companies. The S&P 500 is not
adjusted to reflect sales charges, expenses, or other fees that the SEC
requires to be reflected in the Fund's performance. Investments cannot be made
in an index.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Quantitative Equity Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Shares Value
- -----------------------------------------------------------
<C> <S> <C>
Common Stocks--97.7%
Basic Materials--2.9%
60,000 Du Pont (E.I.) de Nemours & Co. $ 3,566,250
220,000 Ecolab, Inc. 7,617,500
80,000 Georgia-Pacific Corp. 3,185,000
100,000 Weyerhaeuser Co. 6,125,000
------------
Total 20,493,750
------------
Capital Goods--9.4%
110,000 Ball Corp. 4,090,625
178,000 Corning, Inc. 16,676,375
173,000 General Electric Co. 22,490,000
129,296 Illinois Tool Works, Inc. 8,371,916
95,000 Ingersoll-Rand Co. 4,601,562
240,000 Tyco International Ltd. 9,615,000
25,000 United Technologies Corp. 1,412,500
------------
Total 67,257,978
------------
Communication Services--7.8%
70,500 AT&T Corp. 3,939,187
45,000 Alltel Corp. 3,892,500
100,000 Bell Atlantic Corp. 6,331,250
240,000 BellSouth Corp. 11,085,000
85,000 GTE Corp. 6,205,000
326,760 SBC Communications, Inc. 16,971,098
60,000 Sprint Corp. 4,162,500
50,000 U.S. West, Inc. 3,103,125
------------
Total 55,689,660
------------
Consumer Cyclicals--7.4%
170,000 Arvin Industries, Inc. 4,515,625
40,000 (1)Best Buy Co., Inc. 2,500,000
120,000 Dayton-Hudson Corp. 8,467,500
50,000 Ford Motor Co. 2,525,000
80,000 Gannett Co., Inc. 5,725,000
25,000 Home Depot, Inc. 1,976,562
70,000 Knight-Ridder, Inc. 3,819,375
245,000 TJX Cos., Inc. 6,415,938
100,000 Times Mirror Co., Class A 6,456,250
175,000 Wal-Mart Stores, Inc. 10,084,375
------------
Total 52,485,625
------------
Consumer Staples--10.2%
130,000 Albertsons, Inc. 4,151,875
78,000 Anheuser-Busch Cos., Inc. 5,835,375
40,000 BestFoods 2,192,500
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
Common Stocks--continued
Consumer Staples--continued
158,760 CBS Corp. $ 8,255,520
40,000 CVS Corp. 1,587,500
210,000 IBP, Inc. 4,633,125
195,000 PepsiCo, Inc. 6,739,688
192,000 Philip Morris Cos., Inc. 5,052,000
75,000 Procter & Gamble Co. 8,100,000
115,000 Quaker Oats Co. 7,503,750
194,000 (1)Safeway, Inc. 7,153,750
266,000 SUPERVALU Inc. 5,170,375
170,000 SYSCO Corp. 6,470,625
------------
Total 72,846,083
------------
Energy--5.8%
100,000 BP Amoco PLC, ADR 6,093,750
40,000 Chevron Corp. 3,542,500
154,200 Exxon Corp. 12,229,987
77,000 Mobil Corp. 8,032,063
180,000 Royal Dutch Petroleum Co., ADR 10,440,000
20,000 Texaco, Inc. 1,218,750
------------
Total 41,557,050
------------
Finance--13.9%
24,000 AEGON NV, ADR 2,163,000
200,000 Ambac Financial Group, Inc. 10,900,000
95,000 American General Corp. 6,964,687
30,000 American National Insurance Co. 1,991,250
270,000 AmSouth Bancorporation 6,091,875
75,000 Bank of America Corp. 4,387,500
140,000 Bank of New York Co., Inc. 5,582,500
40,000 CIGNA Corp. 3,290,000
170,000 Chase Manhattan Corp. 13,132,500
420,000 Citigroup, Inc. 22,627,500
20,000 J.P. Morgan & Co., Inc. 2,630,000
47,000 Marsh & McLennan Cos., Inc. 3,695,375
125,000 PNC Bank Corp. 6,968,750
216,600 SouthTrust Corp. 8,406,788
------------
Total 98,831,725
------------
Health Care--10.8%
85,000 Abbott Laboratories 3,230,000
120,000 (1)Amgen, Inc. 5,467,500
38,000 Baxter International, Inc. 2,567,375
205,200 Bristol-Myers Squibb Co. 14,992,425
150,000 Guidant Corp. 7,500,000
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Quantitative Equity Fund
<TABLE>
<CAPTION>
Shares Value
- -------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Health Care--continued
75,000 Johnson & Johnson $ 7,781,250
110,000 Lilly (Eli) & Co. 7,892,500
69,200 Merck & Co., Inc. 5,432,200
150,000 Pfizer, Inc. 5,428,125
319,200 Schering Plough Corp. 16,319,100
------------
Total 76,610,475
------------
Technology--25.1%
50,000 (1)America Online, Inc. 3,634,375
244,000 (1)Cisco Systems, Inc. 21,761,750
295,000 Comdisco, Inc. 7,116,875
200,000 Computer Associates International, Inc. 13,000,000
135,000 (1)Dell Computer Corp. 5,805,000
279,000 (1)EMC Corp. 23,313,937
90,000 Intel Corp. 6,901,875
128,000 International Business Machines Corp. 13,192,000
215,000 (1)Lexmark International Group, Class A 17,845,000
303,000 Lucent Technologies, Inc. 22,137,938
185,000 (1)Microsoft Corp. 16,843,672
205,000 (1)Sun Microsystems, Inc. 27,111,250
------------
Total 178,663,672
------------
</TABLE>
<TABLE>
<CAPTION>
Shares or
Principal
Amount Value
<C> <S> <C>
Common Stocks--continued
Transportation--0.5%
50,000 GATX Corp. $ 1,643,750
40,000 Union Pacific Corp. 1,882,500
------------
Total 3,526,250
------------
Utilities--3.9%
230,000 Coastal Corp. 8,107,500
112,500 DQE, Inc. 4,141,406
57,442 Duke Energy Corp. 2,911,591
60,000 Enron Corp. 2,283,750
155,000 GPU, Inc. 4,960,000
65,000 Southern Co. 1,519,375
125,000 Williams Cos., Inc. (The) 4,218,750
------------
Total 28,142,372
------------
Total Common Stocks (identified cost $345,624,827) 696,104,640
------------
U.S. Treasury Obligation--0.3%
$ 2,000,000 (2)United States Treasury Bill, 12/16/1999
(identified cost $1,996,142) 1,996,142
------------
Repurchase Agreement (3)--2.0%
14,096,935 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999,
due 12/1/1999 (at amortized cost) 14,096,935
------------
Total Investments (identified cost $361,717,904) $712,197,717
------------
</TABLE>
(See Notes to Portfolios of Investments)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Growth and Income Fund (Class A Shares)
Growth of $10,000 Invested in Wachovia Growth and Income Fund (Class A Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Growth and Income Fund (Class A Shares) (the "Fund") from January 29,
1993 (start of performance) to November 30, 1999 compared to the Standard and
Poor's 500 Index ( S&P 500).+
[Please see Appendix A7]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund after deducting
the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge
= $9,550). The Fund's performance assumes the reinvestment of all dividends
and distributions. The S&P 500 has been adjusted to reflect the reinvestment
of dividends on securities in the index.
** Total returns quoted reflect all applicable sales charges and contingent
deferred sales charges.
+ The S&P 500 is an unmanaged index comprised of common stocks in industry,
transportation, and financial and public utility companies. The S&P 500 is
not adjusted to reflect sales charges, expenses, or other fees that the SEC
requires to be reflected in the Fund's performance. Investments cannot be
made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Growth and Income Fund (Class Y Shares)
Growth of $10,000 Invested in Wachovia Growth and Income Fund (Class Y Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Growth and Income Fund (Class Y Shares) (the "Fund") from March 29,
1998 (start of performance) to November 30, 1999 compared to the Standard and
Poor's 500 Index ( S&P 500).+
[Please see Appendix A8]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* The Fund's performance assumes the reinvestment of all dividends and
distributions. The S&P 500 has been adjusted to reflect the reinvestment of
dividends on securities in the index.
+ The S&P 500 is an unmanaged index comprised of common stocks in industry,
transportation, and financial and public utility companies. The S&P 500 is not
adjusted to reflect sales charges, expenses, or other fees that the SEC
requires to be reflected in the Fund's performance. Investments cannot be made
in an index.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Growth & Income Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Shares Value
- -----------------------------------------------------------------------------
<C> <S> <C>
Common Stocks--93.8%
Basic Materials--3.6%
121,127 Du Pont (E.I.) de Nemours & Co. $ 7,199,486
87,226 Weyerhaeuser Co. 5,342,593
------------
Total 12,542,079
------------
Capital Goods--7.0%
81,389 General Electric Co. 10,580,570
177,824 Tyco International Ltd. 7,124,074
118,293 United Technologies Corp. 6,683,555
------------
Total 24,388,199
------------
Communication Services--6.3%
50,820 AT&T Corp. 2,839,567
75,000 Alltel Corp. 6,487,500
130,281 (1)MCI Worldcom, Inc. 10,772,610
57,417 (1)Qwest Communications International, Inc. 1,962,944
------------
Total 22,062,621
------------
Consumer Cyclicals--7.1%
64,046 (1)Federated Department Stores, Inc. 3,014,165
47,836 Gannett Co., Inc. 3,423,264
33,157 General Motors Corp. 2,387,304
57,960 Lowe's Cos., Inc. 2,887,132
116,433 Marriott International, Inc., Class A 3,791,350
54,149 McGraw-Hill Cos., Inc. 3,069,571
54,711 (1)Tommy Hilfiger Corp. 1,347,258
85,186 Wal-Mart Stores, Inc. 4,908,843
------------
Total 24,828,887
------------
Consumer Staples--9.3%
41,631 (1)AT&T Corp.--Liberty Media Group, Inc., Class A 1,740,696
20,644 Anheuser-Busch Cos., Inc. 1,544,429
61,933 CBS Corp. 3,220,516
18,032 CVS Corp. 715,645
47,197 (1)Clear Channel Communications, Inc. 3,793,459
106,510 Colgate-Palmolive Co. 5,844,736
44,176 Comcast Corp., Class A 1,996,203
105,312 PepsiCo, Inc. 3,639,846
70,834 Procter & Gamble Co. 7,650,072
40,094 Time Warner, Inc. 2,473,299
------------
Total 32,618,901
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
Common Stocks--continued
Energy--6.6%
138,224 Exxon Mobil Corp. $ 10,962,891
112,140 Royal Dutch Petroleum Co., ADR 6,504,120
95,461 Schlumberger Ltd. 5,733,626
------------
Total 23,200,637
------------
Finance--16.5%
25,878 American Express Co. 3,915,665
242 American General Corp. 17,742
37,075 American International Group, Inc. 3,827,994
883 Bank of America Corp. 51,655
124,000 Bank of New York Co., Inc. 4,944,500
831 Chase Manhattan Corp. 64,195
204,631 Citigroup, Inc. 11,024,495
185,714 Freddie Mac 9,169,629
155,000 Franklin Resources, Inc. 4,872,812
298 Marsh & McLennan Cos., Inc. 23,430
30,400 Merrill Lynch & Co., Inc. 2,451,000
84,709 Morgan Stanley, Dean Witter & Co. 10,218,023
30,000 Progressive Corp. 2,416,875
680 SunTrust Banks, Inc. 47,515
100,000 Wells Fargo Co. 4,650,000
------------
Total 57,695,530
------------
Healthcare--10.1%
153,703 Abbott Laboratories 5,840,714
40,978 Bristol-Myers Squibb Co. 2,993,955
75,489 Johnson & Johnson 7,831,984
114,632 Merck & Co., Inc. 8,998,612
187,654 Schering Plough Corp. 9,593,811
------------
Total 35,259,076
------------
Technology--25.6%
49,098 (1)America Online, Inc. 3,568,811
135,589 (1)Cisco Systems, Inc. 12,092,844
100,670 (1)EMC Corp. 8,412,237
102,524 Intel Corp. 7,862,309
64,316 International Business Machines Corp. 6,628,568
96,300 Lucent Technologies, Inc. 7,035,919
104,481 (1)Microsoft Corp. 9,512,669
38,105 Nokia Oyj, Class A, ADR 5,265,635
145,163 (1)Sun Microsystems, Inc. 19,197,807
101,744 Texas Instruments, Inc. 9,773,783
------------
Total 89,350,582
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Growth & Income Fund
<TABLE>
<CAPTION>
Shares or
Principal
Amount Value
- ------------------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Utilities--1.7%
117,752 Duke Energy Corp. $ 5,968,554
------------
Total Common Stocks (identified cost $171,566,453) 327,915,066
------------
U.S. Government Agency--2.9%
Federal National Mortgage Association--2.9%
$10,000,000 Discount Note, 12/10/1999 (identified cost
$9,986,850) 9,986,300
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
U.S. Treasury Obligation--0.4%
$ 1,500,000 (2)United States Treasury Bill, 12/16/1999
(identified cost $1,497,106) $ 1,498,140
------------
(3) Repurchase Agreement--2.9%
10,292,097 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999,
due 12/1/1999 (at amortized cost) 10,292,097
------------
Total Investments (identified cost $193,342,506) $349,691,603
------------
</TABLE>
(See Notes to Portfolios of Investments)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Equity Index Fund (Class A Shares)
Growth of $10,000 Invested in Wachovia Equity Index Fund (Class A Shares) The
graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Equity Index Fund (Class A Shares) (the "Fund") from May 7, 1993 (start
of performance) to November 30, 1999 compared to the Standard and Poor's 500
Index (S&P 500).+
[Please see Appendix A9]
Past performance is no guarantee of future results. investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund after deducting
the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge
= $9,550). The Fund's performance assumes the reinvestment of all dividends
and distributions. The S&P 500 has been adjusted to reflect the reinvestment
of dividends on securities in the index.
** Total returns quoted reflect all applicable sales charges and contingent
deferred sales charges.
+ The S&P 500 is an unmanaged index comprised of common stocks in industry,
transportation, and financial and public utility companies. The S&P 500 is
not adjusted to reflect sales charges, expenses, or other fees that the SEC
requires to be reflected in the Fund's performance. Investments cannot be
made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Equity Index Fund (Class Y Shares)
Growth of $10,000 Invested in Wachovia Equity Index Fund (Class Y Shares) The
graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Equity Index Fund (Class Y Shares) (the "Fund") from July 23, 1996
(start of performance) to November 30, 1999 compared to the Standard and Poor's
500 Index (S&P 500).+
[Please see Appendix A10]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* The Fund's performance assumes the reinvestment of all dividends and
distributions. The S&P 500 has been adjusted to reflect the reinvestment of
dividends on securities in the index.
+ The S&P 500 is an unmanaged index comprised of common stocks in industry,
transportation, and financial and public utility companies. The S&P 500 is not
adjusted to reflect sales charges, expenses, or other fees that the SEC
requires to be reflected in the Fund's performance. Investments cannot be made
in an index.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Equity Index Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Shares Value
- -------------------------------------------------------------------------
<C> <S> <C>
Common Stocks--88.8%
Basic Materials--2.5%
9,722 Air Products & Chemicals, Inc. $ 314,750
9,562 Alcan Aluminum, Ltd. 325,108
15,422 Alcoa, Inc. 1,010,141
1,681 Armstrong World Industries, Inc. 56,313
16,579 Barrick Gold Corp. 298,422
2,200 Bemis Co., Inc. 69,300
5,460 (1)Bethlehem Steel Corp. 34,125
2,366 Boise Cascade Corp. 81,923
4,015 Champion International Corp. 222,582
9,298 Dow Chemical Co. 1,089,028
44,105 Du Pont (E.I.) de Nemours & Co. 2,621,491
3,329 Eastman Chemical Co. 129,415
5,435 Ecolab, Inc. 188,187
5,317 Engelhard Corp. 89,392
1,390 (1)FMC Corp. 67,415
6,954 Freeport-McMoRan Copper & Gold, Inc., Class B 109,960
7,392 Georgia-Pacific Corp. 294,294
4,603 Goodrich (B.F.) Co. 103,855
2,638 (1)Grace (W.R.) & Co. 35,943
2,483 Great Lakes Chemical Corp. 82,405
4,225 Hercules, Inc. 100,344
10,041 Homestake Mining Co. 82,838
7,426 Inco Ltd. 136,453
4,457 International Flavors & Fragrances, Inc. 164,073
17,224 International Paper Co. 898,877
4,565 Louisiana-Pacific Corp. 55,921
4,316 Mead Corp. 154,027
26,317 Monsanto Co. 1,110,248
7,024 Newmont Mining Corp. 166,381
3,679 Nucor Corp. 185,560
7,443 PPG Industries, Inc. 435,881
3,771 Phelps Dodge Corp. 196,092
13,753 Placer Dome, Inc. 156,440
1,219 Potlatch Corp. 49,293
6,627 Praxair, Inc. 295,730
2,708 Reynolds Metals Co. 169,419
8,872 Rohm & Haas Co. 324,937
4,227 Sigma-Aldrich Corp. 120,998
2,336 Temple-Inland, Inc. 133,736
3,711 USX-U.S. Steel Group, Inc. 93,935
5,582 Union Carbide Corp. 326,547
4,250 Vulcan Materials Co. 171,063
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
Common Stocks--continued
Basic Materials--continued
4,252 Westvaco Corp. $ 128,357
9,879 Weyerhaeuser Co. 605,089
4,661 Willamette Industries, Inc. 192,849
3,884 Worthington Industries, Inc. 62,144
------------
Total 13,741,281
------------
Capital Goods--7.2%
23,526 Allied-Signal, Inc. 1,407,149
7,650 (1)Allied Waste Industries, Inc. 62,156
4,884 Avery Dennison Corp. 289,987
1,295 Ball Corp. 48,158
40,942 Boeing Co. 1,670,929
977 Briggs & Stratton Corp. 52,208
15,067 Caterpillar, Inc. 698,732
4,346 Cooper Industries, Inc. 186,606
9,711 Corning, Inc. 909,799
2,883 Crane Co. 52,975
5,139 Crown Cork & Seal Co., Inc. 104,707
5,618 Danaher Corp. 275,984
9,569 Deere & Co. 410,869
8,922 Dover Corp. 386,992
2,999 Eaton Corp. 232,235
18,502 Emerson Electric Co. 1,054,614
8,523 General Dynamics Corp. 439,467
137,650 General Electric Co. 17,894,500
3,989 Grainger (W.W.), Inc. 187,982
5,290 Honeywell, Inc. 592,149
12,629 Illinois Tool Works, Inc. 817,728
6,907 Ingersoll-Rand Co. 334,558
4,360 ITT Industries, Inc. 152,055
3,557 Johnson Controls, Inc. 193,856
13,853 Laidlaw, Inc. 84,850
16,488 Lockheed Martin Corp. 327,699
18,250 Masco Corp. 460,812
1,615 Milacron, Inc. 23,518
1,848 Millipore Corp. 60,637
16,859 Minnesota Mining & Manufacturing Co. 1,611,088
6,500 Molex, Inc. 328,250
344 NACCO Industries, Inc., Class A 16,663
1,742 National Service Industries, Inc. 51,498
2,891 Northrop Grumman Corp. 162,438
6,526 (1)Owens-Illinois, Inc. 156,216
7,147 (1)Pactiv Corp. 73,257
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Equity Index Fund
<TABLE>
<CAPTION>
Shares Value
- -------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Capital Goods--continued
5,205 Pall Corp. $ 121,992
4,575 Parker-Hannifin Corp. 215,311
11,453 Pitney Bowes, Inc. 549,028
8,031 Rockwell International Corp. 398,538
3,504 (1)Sealed Air Corp. 164,688
11,286 (1)Solectron Corp. 929,684
6,206 Textron, Inc. 441,014
6,672 (1)Thermo Electron Corp. 100,080
2,384 Thomas & Betts Corp. 97,744
2,609 Timken Co. 49,897
71,334 Tyco International Ltd. 2,857,818
20,247 United Technologies Corp. 1,143,956
25,378 Waste Management, Inc. 412,393
------------
Total 39,295,464
------------
Communication Services--8.5%
134,282 AT&T Corp. 7,503,007
11,978 Alltel Corp. 1,036,097
65,207 Bell Atlantic Corp. 4,128,418
79,869 BellSouth Corp. 3,688,949
5,775 CenturyTel, Inc. 265,650
32,678 (1)Global Crossing Ltd. 1,425,578
40,991 GTE Corp. 2,992,343
77,927 (1)MCI Worldcom, Inc. 6,443,589
25,494 (1)MediaOne Group, Inc. 2,020,399
15,076 (1)NEXTEL Communications, Inc., Class A 1,494,408
6,320 (1)Qualcomm, Inc. 2,289,815
143,604 SBC Communications, Inc. 7,458,433
35,618 Sprint Corp. 2,470,999
17,450 (1)Sprint Corp. (PCS Group) 1,601,038
21,109 U.S. West, Inc. 1,310,077
------------
Total 46,128,800
------------
Consumer Cyclicals--8.0%
2,976 American Greetings Corp., Class A 70,122
6,416 (1)AutoZone, Inc. 176,841
5,880 (1)Bed Bath & Beyond, Inc. 183,750
8,560 (1)Best Buy Co., Inc. 535,000
3,691 Black & Decker Corp. 165,634
4,223 Block (H&R), Inc. 181,589
25,712 Carnival Corp. 1,134,542
33,835 (1)Cendant Corp. 560,392
2,496 Centex Corp. 59,280
8,430 Circuit City Stores, Inc. 408,855
8,698 Clorox Co. 387,605
4,599 (1)Consolidated Stores Corp. 72,434
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
Common Stocks--continued
Consumer Cyclicals--continued
3,184 Cooper Tire & Rubber Co. $ 47,760
9,094 Costco Cos., Inc. 833,806
1,760 Cummins Engine Co., Inc. 71,280
6,954 Dana Corp. 192,974
18,481 Dayton-Hudson Corp. 1,304,066
23,665 Delphi Automotive Systems Corp. 372,724
3,379 Deluxe Corp. 88,488
4,487 Dillards, Inc., Class A 84,692
9,203 Dollar General Corp. 225,474
5,705 Donnelley (R.R.) & Sons Co. 136,920
3,943 Dow Jones & Co. 239,044
7,020 Dun & Bradstreet Corp. 189,540
9,008 (1)Federated Department Stores, Inc. 423,939
1,458 Fleetwood Enterprises, Inc. 30,618
3,183 Fluor Corp. 133,885
50,829 Ford Motor Co. 2,566,864
1,710 Foster Wheeler Corp. 17,421
11,829 Gannett Co., Inc. 846,513
35,913 Gap (The), Inc. 1,454,476
27,043 General Motors Corp. 1,947,096
7,557 Genuine Parts Co. 194,593
6,548 Goodyear Tire & Rubber Co. 220,995
2,983 Harcourt General, Inc. 98,812
8,242 Hasbro, Inc. 177,718
15,454 Hilton Hotels Corp. 155,506
62,459 Home Depot, Inc. 4,938,165
13,456 IMS Health, Inc. 317,057
11,676 Interpublic Group Cos., Inc. 548,772
1,484 Jostens, Inc. 27,268
20,707 (1)K Mart Corp. 205,776
2,008 Kaufman & Broad Homes Corp. 44,427
3,296 Knight-Ridder, Inc. 179,838
6,645 (1)Kohl's Corp. 479,686
8,260 Leggett & Platt, Inc. 177,074
8,802 Limited, Inc. 373,535
2,713 Liz Claiborne, Inc. 101,568
14,808 Lowe's Cos., Inc. 737,623
10,557 Marriott International, Inc., Class A 343,762
14,271 May Department Stores Co. 479,862
3,779 Maytag Corp. 180,211
2,479 McDermott International, Inc. 21,226
8,266 McGraw-Hill Cos., Inc. 468,579
2,198 Meredith Corp. 83,112
2,816 (1)Navistar International Corp. 104,720
7,211 New York Times Co., Class A 277,173
12,027 Nike, Inc., Class B 553,242
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Equity Index Fund
<TABLE>
<CAPTION>
Shares Value
- -----------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Consumer Cyclicals--continued
5,857 Nordstrom, Inc. $ 162,898
15,600 (1)Office Depot, Inc. 173,550
7,536 Omnicom Group, Inc. 664,110
2,279 Owens Corning 35,894
3,282 PACCAR, Inc. 134,972
10,305 Paychex, Inc. 411,556
11,068 Penney (J.C.) Co., Inc. 246,955
2,280 Pep Boys-Manny Moe & Jack 22,088
1,813 Pulte Corp. 36,373
2,371 (1)Reebok International Ltd. 21,339
1,518 Russell Corp. 19,829
16,093 Sears, Roebuck & Co. 550,179
10,832 Service Corp. International 81,917
7,223 Sherwin-Williams Co. 154,843
2,473 Snap-On Inc. 74,808
753 Springs Industries, Inc., Class A 30,120
3,730 Stanley Works 116,096
19,241 (1)Staples, Inc. 452,164
13,533 TJX Cos., Inc. 354,395
5,030 TRW, Inc. 262,503
8,316 Tandy Corp. 637,214
3,343 Times Mirror Co., Class A 215,832
10,577 (1)Toys 'R' Us, Inc. 185,098
9,978 Tribune Co. 479,568
2,420 Tupperware Corp. 43,106
5,038 V.F. Corp. 150,510
186,872 Wal-Mart Stores, Inc. 10,768,499
2,825 (1)Wellpoint Health Networks, Inc. 162,614
3,194 Whirlpool Corp. 194,834
------------
Total 43,477,788
------------
Consumer Staples--10.0%
2,315 Alberto-Culver Co., Class B 60,913
17,579 Albertsons, Inc. 561,429
20,076 Anheuser-Busch Cos., Inc. 1,501,936
25,694 Archer-Daniels-Midland Co. 319,569
11,035 Avon Products, Inc. 402,088
11,554 BestFoods 633,304
2,885 Brown-Forman Corp., Class B 180,853
3,635 Brunswick Corp. 79,288
32,151 CBS Corp. 1,671,852
16,381 CVS Corp. 650,121
18,369 Campbell Soup Co. 819,717
13,868 (1)Clear Channel Communications, Inc. 1,114,640
17,764 Coca Cola Enterprises, Inc. 376,375
103,552 Coca-Cola Co. 6,970,344
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
Common Stocks--continued
Consumer Staples--continued
24,600 Colgate-Palmolive Co. $ 1,349,925
31,012 Comcast Corp., Class A 1,401,355
20,555 ConAgra, Inc. 495,889
1,537 Coors Adolph Co., Class B 76,466
5,838 Darden Restaurants, Inc. 103,989
86,459 Disney (Walt) Co. 2,410,045
9,261 Fort James Corp. 266,254
7,184 Fortune Brands, Inc. 245,603
12,848 General Mills, Inc. 484,209
46,599 Gillette Co. 1,872,697
1,608 Great Atlantic & Pacific Tea Co., Inc. 40,903
5,304 (1)Harrah's Entertainment, Inc. 146,523
15,209 Heinz (H.J.) Co. 636,877
6,013 Hershey Foods Corp. 295,389
17,026 Kellogg Co. 576,756
22,313 Kimberly-Clark Corp. 1,425,243
34,506 (1)Kroger Co., Inc. 735,409
1,634 Longs Drug Stores Corp. 41,054
16,383 Mattel, Inc. 234,482
56,840 McDonald's Corp. 2,557,800
8,212 (1)Mirage Resorts, Inc. 105,216
13,650 Nabisco Group Holdings Corp. 157,828
11,798 Newell Rubbermaid, Inc. 387,122
62,084 PepsiCo, Inc. 2,145,778
101,363 Philip Morris Cos., Inc. 2,667,114
55,736 Procter & Gamble Co. 6,019,488
5,724 Quaker Oats Co. 373,491
13,515 Ralston Purina Co. 401,227
10,858 Rite Aid Corp. 82,114
20,874 (1)Safeway, Inc. 769,729
37,921 Sara Lee Corp. 919,584
16,559 Seagram Co. Ltd. 721,351
5,862 SUPERVALU, Inc. 113,943
14,034 SYSCO Corp. 534,169
54,171 Time Warner, Inc. 3,341,674
6,407 (1)Tricon Global Restaurants, Inc. 265,891
7,362 UST, Inc. 196,013
24,009 Unilever NV, ADR 1,306,990
29,222 (1)Viacom, Inc., Class B 1,453,795
41,898 Walgreen Co. 1,220,279
5,228 Wendy's International, Inc. 115,343
6,239 Winn-Dixie Stores, Inc. 163,384
4,882 Wrigley (Wm.), Jr. Co. 406,121
------------
Total 54,606,941
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Equity Index Fund
<TABLE>
<CAPTION>
Shares Value
- -------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Energy--5.2%
3,796 Amerada-Hess Corp. $ 219,931
4,605 Anadarko Petroleum Corp. 138,726
4,106 Apache Corp. 147,046
3,212 Ashland, Inc. 108,405
13,493 Atlantic Richfield Co. 1,300,388
13,734 Baker Hughes, Inc. 346,784
9,185 Burlington Resources, Inc. 308,846
27,407 Chevron Corp. 2,427,232
26,321 Conoco, Inc., Class B 689,281
102,129 Exxon Corp. 8,100,106
18,469 Halliburton Co. 714,519
2,113 Helmerich & Payne, Inc. 47,807
3,627 Kerr-McGee Corp. 207,646
32,759 Mobil Corp. 3,417,173
14,531 Occidental Petroleum Corp. 318,774
10,696 Phillips Petroleum Co. 511,403
3,522 (1)Rowan Cos., Inc. 60,314
90,076 Royal Dutch Petroleum Co., ADR 5,224,408
22,932 Schlumberger Ltd. 1,377,353
10,082 Sempra Energy 186,517
3,929 Sunoco, Inc. 100,435
22,454 Texaco, Inc. 1,368,291
10,544 Union Pacific Resources Group, Inc. 137,731
10,139 Unocal Corp. 336,488
12,921 USX Corp. 341,599
------------
Total 28,137,203
------------
Finance--12.9%
10,716 AON Corp. 382,427
6,275 Aetna, Inc. 342,772
10,850 AFLAC, Inc. 519,444
34,016 Allstate Corp. 890,794
18,991 American Express Co. 2,873,576
10,588 American General Corp. 776,233
64,941 American International Group, Inc. 6,705,158
16,610 AmSouth Bancorporation 374,763
30,356 Associates First Capital Corp., Class A 1,009,337
13,057 BB&T Corp. 419,456
50,040 Bank One Corp. 1,763,910
73,150 Bank of America Corp. 4,279,275
31,953 Bank of New York Co., Inc. 1,274,126
4,793 Bear Stearns Cos., Inc. 195,625
7,804 CIGNA Corp. 641,879
8,265 Capital One Financial Corp. 384,839
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
Common Stocks--continued
Finance--continued
35,529 Chase Manhattan Corp. $ 2,744,615
7,445 Chubb Corp. 398,773
7,014 Cincinnati Financial Corp. 234,969
142,108 Citigroup, Inc. 7,656,069
6,534 Comerica, Inc. 346,302
13,609 Conseco, Inc. 275,582
4,699 Countrywide Credit Industries, Inc. 132,159
43,107 Fannie Mae 2,872,004
29,416 Freddie Mac 1,452,415
12,496 Fifth Third Bancorp 874,720
40,709 First Union Corp. 1,574,929
41,437 Firstar Corp. 1,077,362
38,532 Fleet Boston Financial Corp. 1,456,991
10,629 Franklin Resources, Inc. 334,149
2,391 Golden West Financial Corp. 241,342
9,356 Hartford Financial Services Group, Inc. 436,808
20,281 Household International, Inc. 802,367
9,752 Huntington Bancshares, Inc. 270,008
7,344 J.P. Morgan & Co., Inc. 965,736
4,452 Jefferson-Pilot Corp. 302,179
18,671 KeyCorp 504,117
5,322 Lehman Brothers Holdings, Inc. 406,468
8,488 Lincoln National Corp. 353,843
4,776 Loews Corp. 305,664
4,173 MBIA, Inc. 208,650
33,681 MBNA Corp. 850,445
4,600 MGIC Investment Corp. 259,900
11,259 Marsh & McLennan Cos., Inc. 885,239
21,940 Mellon Bank Corp. 799,439
15,350 Merrill Lynch & Co., Inc. 1,237,594
23,816 Morgan Stanley, Dean Witter & Co. 2,872,805
26,888 National City Corp. 670,519
4,665 Northern Trust Corp. 451,630
6,000 PaineWebber Group, Inc. 235,125
12,639 PNC Bank Corp. 704,624
4,400 Price (T. Rowe) Associates 158,400
3,045 Progressive Corp. 245,313
5,948 Providian Financial Corp. 470,636
9,290 Regions Financial Corp. 254,894
4,506 Republic New York Corp. 318,518
5,724 SAFECO Corp. 135,587
6,961 SLM Holding Corp. 345,005
34,584 Schwab (Charles) Corp. 1,312,031
6,730 SouthTrust Corp. 261,208
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Equity Index Fund
<TABLE>
<CAPTION>
Shares Value
- ------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Finance--continued
9,452 St. Paul Cos., Inc. $ 285,332
6,742 State Street Corp. 495,116
7,293 Summit Bancorp 237,934
13,350 SunTrust Banks, Inc. 932,831
11,679 Synovus Financial Corp. 233,580
5,442 Torchmark Corp. 172,784
30,485 U.S. Bancorp, Inc. 1,042,206
9,960 UNUM Corp. 324,323
5,716 Union Planters Corp. 243,645
8,517 Wachovia Corp. 659,535
24,921 Washington Mutual, Inc. 722,709
69,182 Wells Fargo Co. 3,216,963
------------
Total 70,097,705
------------
Health Care--9.5%
63,751 Abbott Laboratories 2,422,538
2,772 Allergan, Inc. 272,695
3,660 (1)Alza Corp. 158,066
54,916 American Home Products Corp. 2,855,632
42,764 (1)Amgen, Inc. 1,948,435
2,252 Bard (C.R.), Inc. 122,312
2,356 Bausch & Lomb, Inc. 129,138
12,014 Baxter International, Inc. 811,696
10,385 Becton, Dickinson & Co. 282,991
4,713 Biomet, Inc. 149,343
16,505 (1)Boston Scientific Corp. 348,668
83,474 Bristol-Myers Squibb Co. 6,098,819
11,212 Cardinal Health, Inc. 586,528
23,926 Columbia/HCA Healthcare Corp. 651,983
12,656 Guidant Corp. 632,800
17,321 (1)HEALTHSOUTH, Corp. 98,513
7,031 (1)Humana, Inc. 49,217
56,486 Johnson & Johnson 5,860,422
46,195 Lilly (Eli) & Co. 3,314,491
2,997 Mallinckrodt, Inc. 99,650
4,656 (1)Manor Care, Inc. 93,411
11,400 McKesson HBOC, Inc. 266,475
49,078 Medtronic, Inc. 1,907,907
99,156 Merck & Co., Inc. 7,783,746
4,184 PE Corp.-PE Biosystems Group 341,519
163,548 Pfizer, Inc. 5,918,393
21,342 Pharmacia & Upjohn, Inc. 1,167,141
4,840 (1)Quintiles Transnational Corp. 106,783
61,734 Schering Plough Corp. 3,156,151
3,535 (1)St. Jude Medical, Inc. 93,898
13,007 (1)Tenet Healthcare Corp. 290,219
7,373 United Healthcare Corp. 382,935
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
Common Stocks--continued
Health Care--continued
35,875 Warner-Lambert Co. $ 3,217,539
412 (1)Water Pik Technologies, Inc. 3,039
4,060 (1)Watson Pharmaceuticals, Inc. 150,981
------------
Total 51,774,074
------------
Technology--22.2%
15,064 (1)3Com Corp. 599,736
5,500 (1)ADC Telecommunications, Inc. 293,219
5,520 Adobe System, Inc. 379,155
4,330 (1)Adaptec, Inc. 233,279
6,082 (1)Advanced Micro Devices, Inc. 171,817
4,121 Allegheny Technologies Inc. 103,785
92,940 (1)America Online, Inc. 6,755,576
7,500 (1)Analog Devices, Inc. 430,781
3,617 (1)Andrew Corp. 50,412
6,631 (1)Apple Computer, Inc. 649,009
15,524 (1)Applied Materials, Inc. 1,512,620
1,948 Autodesk, Inc. 57,101
25,781 Automatic Data Processing, Inc. 1,272,937
9,054 (1)BMC Software, Inc. 659,244
7,319 (1)Cabletron Systems, Inc. 167,880
6,010 (1)Ceridian Corp. 129,966
136,682 (1)Cisco Systems, Inc. 12,190,326
3,720 (1)Citrix Systems, Inc. 352,935
71,462 Compaq Computer Corp. 1,746,353
22,611 Computer Associates International, Inc. 1,469,715
6,657 (1)Computer Sciences Corp. 434,369
15,438 (1)Compuware Corp. 521,997
2,930 (1)Comverse Technology, Inc. 354,164
106,542 (1)Dell Computer Corp. 4,581,306
43,261 (1)EMC Corp. 3,614,997
13,608 Eastman Kodak Co. 841,995
20,699 Electronic Data Systems Corp. 1,331,204
6,194 Equifax, Inc. 153,301
18,144 First Data Corp. 784,728
13,130 (1)Gateway 2000, Inc. 1,002,804
7,482 (1)General Instrument Corp. 490,071
42,766 Hewlett-Packard Co. 4,057,424
5,694 Ikon Office Solutions, Inc. 38,079
139,142 Intel Corp. 10,670,452
76,220 International Business Machines Corp. 7,855,424
3,672 (1)KLA-Tencor Corp. 310,513
5,934 (1)LSI Logic Corp. 358,636
5,400 (1)Lexmark International Group, Class A 448,200
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Equity Index Fund
<TABLE>
<CAPTION>
Shares Value
- -----------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Technology--continued
127,684 Lucent Technologies, Inc. $ 9,328,912
10,769 Micron Technology, Inc. 722,869
214,174 (1)Microsoft Corp. 19,499,873
25,212 Motorola, Inc. 2,880,471
6,980 (1)National Semiconductor Corp. 296,650
3,000 (1)Network Appliance, Inc. 353,062
55,588 Nortel Networks Corp. 4,113,512
13,990 (1)Novell, Inc. 273,679
60,440 (1)Oracle Corp. 4,098,588
11,035 (1)Parametric Technology Corp. 250,357
10,238 (1)PeopleSoft, Inc. 192,602
1,878 PerkinElmer, Inc. 77,233
1,842 Polaroid Corp. 35,459
14,155 Raytheon Co., Class B 434,382
3,148 Scientific-Atlanta, Inc. 183,568
8,742 (1)Seagate Technology, Inc. 323,454
1,117 Shared Medical Systems Corp. 48,869
7,874 (1)Silicon Graphics, Inc. 74,311
31,974 (1)Sun Microsystems, Inc. 4,228,562
1,988 Tektronix, Inc. 67,592
7,150 (1)Teradyne, Inc. 311,472
1,177 (1)Teledyne Technologies Inc. 10,372
16,320 (1)Tellabs, Inc. 1,058,760
32,758 Texas Instruments, Inc. 3,146,815
11,570 (1)Unisys Corp. 332,638
28,000 Xerox Corp. 757,750
6,700 (1)Xilinx, Inc. 599,650
------------
Total 120,776,972
------------
Transportation--0.7%
6,290 (1)AMR Corp. 382,904
19,705 Burlington Northern Santa Fe 571,445
9,169 CSX Corp. 326,073
5,998 Delta Air Lines, Inc. 295,402
12,396 (1)FDX Corp. 522,956
4,920 Kansas City Southern Industries, Inc. 293,047
15,929 Norfolk Southern Corp. 340,482
2,701 Ryder Systems, Inc. 60,941
21,193 Southwest Airlines Co. 345,711
3,222 (1)US Airways Group, Inc. 90,015
10,392 Union Pacific Corp. 489,074
------------
Total 3,718,050
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
Common Stocks--continued
Utilities--2.1%
8,574 (1)AES Corp. $ 496,756
5,764 Ameren Corp. 199,578
8,038 American Electric Power Co., Inc. 252,192
6,657 Carolina Power & Light Co. 200,542
8,931 Central & South West Corp. 178,620
6,662 Cinergy Corp. 168,632
4,300 CMS Energy Corp. 142,975
8,934 Coastal Corp. 314,924
3,505 Columbia Energy Group 219,939
9,345 Consolidated Edison Co. 322,402
6,269 Constellation Energy Group 184,544
4,026 Consolidated Natural Gas Co. 258,167
6,094 DTE Energy Co. 201,483
8,207 Dominion Resources, Inc. 372,393
15,205 Duke Energy Corp. 770,703
945 Eastern Enterprises 53,629
14,816 Edison International 392,624
9,622 El Paso Energy Corp. 370,447
29,386 Enron Corp. 1,118,505
10,359 Entergy Corp. 285,520
4,100 Florida Progress Corp. 175,275
7,598 FPL Group, Inc. 332,413
9,959 FirstEnergy Corp. 232,169
5,375 GPU, Inc. 172,000
4,802 New Century Energies, Inc. 150,963
7,871 Niagara Mohawk Holdings, Inc. 118,065
2,001 NICOR, Inc. 69,410
6,409 Northern States Power Co. 130,984
1,324 ONEOK, Inc. 35,665
16,068 P G & E Corp. 359,522
6,804 P P & L Resources, Inc. 156,917
8,042 PECO Energy Co. 264,883
1,487 Peoples Energy Corp. 54,647
3,570 Pinnacle West Capital Corp. 118,479
9,187 Public Service Enterprises Group, Inc. 321,545
12,400 Reliant Energy, Inc. 307,675
29,289 Southern Co. 684,630
11,860 Texas Utilities Co. 424,736
6,400 Tosco Corp. 173,200
9,123 Unicom Corp. 291,366
17,969 Williams Cos., Inc. (The) 606,454
------------
Total 11,685,573
------------
Total Common Stocks (identified cost $219,457,860) 483,439,851
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Equity Index Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- ------------------------------------------------------------------------------
<C> <S> <C>
U.S. Government Agency--3.7%
$20,000,000 (2)Federal National Mortgage Association, Discount
Bond, 12/10/1999 (identified cost $19,973,701) $ 19,972,600
------------
U.S. Treasury Obligation--0.8%
4,400,000 (2)United States Treasury Bill, 12/16/1999
(identified cost $4,391,520) 4,394,544
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
(3) Repurchase Agreement--6.9%
$37,901,020 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999,
due 12/1/1999 (at amortized cost) $ 37,901,020
------------
Total Investments (identified cost $281,724,101) $545,708,015
------------
</TABLE>
(See Notes to Portfolios of Investments)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Special Values Fund (Class A Shares)
Growth of $10,000 Invested in Wachovia Special Values Fund (Class A Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Special Values Fund (Class A Shares) (the "Fund") from May 7, 1993
(start of performance) to November 30, 1999 compared to the Russell 2000 Small
Stock Index (Russell 2000 Index).+
[Please see Appendix A11]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund after deducting
the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge
= $9,550). The Fund's performance assumes the reinvestment of all dividends
and distributions. The Russell 2000 Index has been adjusted to reflect the
reinvestment of dividends on securities in the index.
** Total returns quoted reflect all applicable sales charges and contingent
deferred sales charges.
+ The Russell 2000 Index is an unmanaged capitalization-weighted index
consisting of 2,000 small capitalization common stocks. The Russell 2000
Index is not adjusted to reflect sales charges, expenses, or other fees that
the SEC requires to be reflected in the Fund's performance. Investments
cannot be made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Special Values Fund (Class B Shares)
Growth of $10,000 Invested in Wachovia Special Values Fund (Class B Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Special Values Fund (Class B Shares) (the "Fund") from March 26, 1999
(start of performance) to November 30, 1999 compared to the Russell 2000 Small
Stock Index (Russell 2000 Index).+
[Please see Appendix A12]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund. The ending value
of the Fund reflects the maximum 5.0% contingent deferred sales charge on any
redemption less than one year from the purchase date. The Fund's performance
assumes the reinvestment of all dividends and distributions. The Russell 2000
Index has been adjusted to reflect the reinvestment of dividends on
securities in the index.
** Total returns quoted reflect all applicable sales charges and contingent
deferred sales charges.
+ The Russell 2000 Index is an unmanaged capitalization-weighted index
consisting of 2,000 small capitalization common stocks. The Russell 2000
Index is not adjusted to reflect sales charges, expenses, or other fees that
the SEC requires to be reflected in the Fund's performance. Investments
cannot be made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Special Values Fund (Class Y Shares)
Growth of $10,000 Invested in Wachovia Special Values Fund (Class Y Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Special Values Fund (Class Y Shares) (the "Fund") from July 23, 1996
(start of performance) to November 30, 1999 compared to the Russell 2000 Small
Stock Index (Russell 2000 Index).+
[Please see Appendix A13]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* The Fund's performance assumes the reinvestment of all dividends and
distributions. The Russell 2000 Index has been adjusted to reflect the
reinvestment of dividends on securities in the index.
+ The Russell 2000 Index is an unmanaged capitalization-weighted index
consisting of 2,000 small capitalization common stocks. The Russell 2000
Index is not adjusted to reflect sales charges, expenses, or other fees that
the SEC requires to be reflected in the Fund's performance.
Investments cannot be made in an index.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Special Values Fund
Portfolio of Investments
November 30, 1999
Shares Value
- ----------------
<TABLE>
<CAPTION>
<S> <C> <C>
Common Stocks--78.6%
Basic Materials--11.1%
90,000 (1)American Pacific Corp. $ 658,125
30,400 Barrick Gold Corp. 547,200
17,500 (1)Bush Boake Allen, Inc. 439,687
59,600 (1)Chase Industries, Inc. 525,225
79,300 Cleveland Cliffs, Inc. 2,319,525
73,300 Deltic Timber Corp. 1,887,475
55,500 Greif Brothers Corp., Class A 1,637,250
64,400 Lafarge Corp. 1,738,800
14,900 NCH Corp. 694,713
108,650 Roanoke Electric Corp. 1,765,563
88,000 Rock-Tenn Co. 1,364,000
48,900 Southdown, Inc. 2,258,569
33,900 Texas Industries, Inc. 1,228,875
92,000 Universal Corp. 2,363,250
------------
Total 19,428,257
------------
Capital Goods--10.0%
119,600 Amcast Industrial Corp. 1,674,400
104,600 Ampco-Pittsburgh Corp. 1,287,887
28,000 (1)BFC Construction Corp. 252,000
90,050 Butler Manufacturing Co. 1,930,447
85,900 (1)EMCOR Group, Inc. 1,503,250
10,500 Franklin Electronics, Inc. 752,062
99,300 Granite Construction, Inc. 1,886,700
31,000 (1)Harding Lawson Associates Group 232,500
28,500 Millipore Corp. 935,156
127,400 (1)Morrison Knudsen Corp. 1,106,788
96,450 Smith (A.O.) Corp. 2,121,900
14,000 Smith Investment Co. 861,000
159,558 (1)Supreme Industries, Inc. 1,196,685
95,000 (1)Todd Shipyards Corp. 831,250
29,800 Twin Disc, Inc. 415,338
16,170 Westinghouse Air Brake, Co. 293,081
39,800 World Fuel Services Corp. 318,400
------------
Total 17,598,844
------------
Consumer Cyclicals--10.1%
15,800 Allen Organ Co., Class B 601,387
192,700 (1)Barnett, Inc. 1,692,147
81,500 Boston Acoustics, Inc. 1,181,750
63,000 (1)Buckhead America Corp. 374,062
6,000 Capital Southwest Corp. 417,000
62,300 Cavalier Homes, Inc. 268,669
33,100 (1)Coastcast Corp. 430,300
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
Common Stocks--continued
Consumer Cyclicals--continued
34,850 Cordiant Communications Group PLC, ADR $ 694,822
12,900 Enesco Group, Inc. 157,219
4,200 Grey Advertising, Inc. 1,454,775
32,750 (1)GTECH Holdings Corp. 687,750
106,300 GP Strategies Corp. 837,112
210,550 Intermet Corp. 2,131,819
137,000 Johns Manville Corp. 1,566,937
145,000 (1)Oneita Industries, Inc. 290
126,400 (1)Racing Champions Corp. 628,050
44,800 Raven Industries, Inc. 638,400
27,600 Russell Corp. 360,525
136,200 (1)SPR, Inc. 612,900
56,700 Skyline Corp. 1,406,869
32,700 (1)Sport-Haley, Inc. 128,756
119,500 Velcro Industries NV 1,568,438
------------
Total 17,839,977
------------
Consumer Staples--7.0%
99,000 (1)800-JR Cigar, Inc. 822,937
98,100 (1)Alltrista Corp. 2,109,150
33,300 (1)Ascent Entertainment Group, Inc. 403,762
39,247 (1)Chris Craft Industries, Inc. 2,722,761
23,400 (1)Craig Corp. 140,400
13,000 (1)Emmis Communications, Corp., Class A 1,053,000
30,000 (1)GC Cos., Inc. 845,625
42,000 (1)Lone Star Steakhouse & Saloon, Inc. 316,969
217,450 (1)M & F Worldwide Corp. 1,195,975
33,800 National Presto Industries, Inc. 1,191,450
231,400 (1)Omega Protein Corp. 607,425
55,300 (1)On Command Corp. 832,956
------------
Total 12,242,410
------------
Energy--3.6%
26,400 (1)Atwood Oceanics, Inc. 887,700
73,200 Berry Petroleum Co., Class A 1,015,650
68,328 (1)Forest Oil Corp. 781,501
77,000 (1)Global Marine, Inc. 1,179,062
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Special Values Fund
<TABLE>
<CAPTION>
Shares Value
- ----------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Energy--continued
243,150 (1)Kaneb Services, Inc. $ 1,063,781
171,020 (1)(4)Santa Fe Snyder Corp. 1,368,160
------------
Total 6,295,854
------------
Finance--21.6%
93,900 Aegis Realty, Inc. 874,444
57,500 Argonaut Group, Inc. 1,329,687
76,400 CNA Surety Corp. 849,950
29,000 Cameron Financial Corp. 366,125
55,800 Capital Re Corp. 767,250
141,600 Charter Municipal Mortgage Acceptance Co. 1,708,050
200,100 (1)Danielson Holding Corp. 1,000,500
11,900 Duff & Phelps Credit Rating 947,537
47,100 Eaton Vance Corp. 1,692,656
71,400 Enhance Financial Services Group, Inc. 1,222,725
46,994 Equity Residential
Properties Trust 1,888,571
50,879 Financial Security Assurance Holdings Ltd. 2,687,047
137,800 First Union Real Estate Equity & Mortgage
Investments 706,225
88,550 Forest City Enterprises, Inc., Class A 2,197,147
202,500 (1)Healthcare Recoveries, Inc. 658,125
58,631 (1)HomeFed Corp. 28,143
122,500 IPC Holdings Ltd. 2,227,969
66,000 John Nuveen & Co., Inc., Class A 2,466,750
127,000 LaSalle Re Holdings Ltd. 1,524,000
83,500 Leucadia National Corp. 1,821,344
20,300 Liberty Corp. 928,725
101,800 Liberty Financial Cos., Inc. 2,392,300
157,000 Meditrust Cos. 1,030,313
50,500 Merchants Group, Inc. 1,148,875
83,000 (1)Standard Management Corp. 503,188
116,400 Stewart Information
Services Corp. 1,571,400
55,000 Unico American Corp. 378,125
43,200 Virginia Capital
Bancshares, Inc. 702,000
20,100 White Mountain Insurance Group, Inc. 2,371,800
------------
Total 37,990,971
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
Common Stocks--continued
Healthcare--2.4%
82,700 (1)America Service Group, Inc. $ 1,147,463
10,000 (1)Astrosystems, Inc. 28,750
60,600 (1)Hanger Orthopedic
Group, Inc. 621,150
20,850 (1)Healthcare Services
Group, Inc. 166,800
3,500 Mine Safety Appliances Co. 222,250
94,067 (1)Per-Se Technologies, Inc. 711,379
98,500 (1)Sunrise Medical, Inc. 591,000
92,950 (1)Thermotrex Corp. 755,219
------------
Total 4,244,011
------------
Technology--9.9%
32,250 (1)4Front Software,
International, Inc. 685,312
51,260 (1)Anacomp, Inc. 925,884
13,000 (1)Cypress Semiconductor Corp. 354,250
121,500 (1)ESCO Electronics Corp. 1,177,031
53,400 (1)Eagle Point Software Corp. 287,025
52,700 (1)Electroglas, Inc. 1,500,303
22,000 (1)Exar Corp. 1,069,750
39,300 (1)Kulicke & Soffa Industries, Inc. 1,402,519
36,700 Moore Products Co. 1,236,331
64,200 Nam Tai Electronics, Inc. 818,550
28,500 (1)National Semiconductor Corp. 1,211,250
13,800 (1)Novell, Inc. 269,963
62,000 (1)Parametric Technology Corp. 1,406,625
50,449 (1)Phoenix Technology, Ltd. 725,204
50,000 (1)Remedy Corp. 1,743,750
70,000 (1)Silicon Valley Group, Inc. 1,001,875
132,100 United Industrial Corp. 1,147,619
16,300 (1)Vertex Communications Corp. 346,375
------------
Total 17,309,616
------------
Transportation--1.5%
52,500 (1)A.C.L.N. Ltd. 958,125
121,800 (1)Consolidated Freightways Corp. 1,111,425
31,500 (1)Kirby Corp. 578,813
------------
Total 2,648,363
------------
Utilities--1.4%
124,600 UGI Corp. 2,437,488
------------
Total Common Stocks (identified cost $132,199,706) 138,035,791
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Special Values Fund
<TABLE>
<CAPTION>
Shares or
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Preferred Stocks--0.9%
Consumer Staples--0.5%
151,300 (1)Craig Corp., Pfd., Class A $ 869,975
------------
Finance--0.4%
52,000 Price Enterprises, Inc., Cumulative Pfd., Series A,
$1.40 754,000
------------
Total Preferred Stocks
(identified cost $1,544,693) 1,623,975
------------
Corporate Bond--0.3%
Healthcare--0.3%
$ 600,000 Medaphis Corp., Company Guarantee, Series B, 9.50%,
2/15/2005 (identified cost $432,000) 444,000
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount
or Shares Value
<C> <S> <C>
U.S. Treasury Obligations--0.3%
$ 600,000 United States Treasury Bill, 12/16/1999 (identified
cost $598,843) $ 599,256
------------
Closed-End Investment Company--0.4%
138,400 (1)Royce FocusTrust, Inc. (identified cost
$643,560) 666,050
------------
(3) Repurchase Agreement--19.5%
$34,226,952 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999,
due 12/1/1999 (at amortized cost) 34,226,952
------------
Total Investments
(identified cost $169,645,754) $175,596,024
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Emerging Markets Fund (Class A Shares)
Growth of $10,000 Invested in Wachovia Emerging Markets Fund (Class A Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Emerging Markets Fund (Class A Shares) (the "Fund") from December 23,
1994 (start of performance) to November 30, 1999 compared to the International
Finance Corporation Investable Index (Total Return Series) (IFCI).+
[Please see Appendix A14]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund after deducting
the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge
= $9,550). The Fund's performance assumes the reinvestment of all dividends
and distributions. The IFCI has been adjusted to reflect the reinvestment of
dividends on securities in the index.
** Total returns quoted reflect all applicable sales charges and contingent
deferred sales charges.
+ The IFCI is an unmanaged market capitalization-weighted index of over 1,000
securities in 26 emerging market countries. The IFCI is not adjusted to
reflect sales charges, expenses, or other fees that the SEC requires to be
reflected in the Fund's performance. Investments cannot be made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Emerging Markets Fund (Class Y Shares)
Growth of $10,000 Invested in Wachovia Emerging Markets Fund (Class Y Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Emerging Markets Fund (Class Y Shares) (the "Fund") from July 23, 1996
(start of performance) to November 30, 1999 compared to the International
Finance Corporation Investable Index (Total Return Series) (IFCI).+
[Please see Appendix A15]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* The Fund's performance assumes the reinvestment of all dividends and
distributions. The IFCI has been adjusted to reflect the reinvestment of
dividends on securities in the index.
+ The IFCI is an unmanaged market capitalization-weighted index of over 1,000
securities in 26 emerging market countries. The IFCI is not adjusted to
reflect sales charges, expenses, or other fees that the SEC requires to be
reflected in the Fund's performance. Investments cannot be made in an index.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Emerging Markets Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Shares Value
- ------------------------------------------------------------------------------
<C> <S> <C>
Common Stocks--85.4%
Argentina--1.8%
34,680 Banco de Galicia y Buenos Aires SA de CV, Class B,
ADR $ 708,772
120,000 Compania Naviera Perez Companc SA, Class B 637,296
25,000 Quilmes Industrial SA, ADR 290,625
150,000 Siderca SA, Class A 298,545
50,000 Telecom Argentina SA, ADR 1,468,750
------------
Total 3,403,988
------------
Brazil--6.3%
35,000 Aracruz Cellulose, ADR 713,125
15,000 Companhia Brasileira de Distribuicao Groupo Pao de
Acucar, ADR 400,312
60,000 Companhia Cervajaria Brahma, ADR 780,000
57,000 Companhia Vale Do Rio Doce 1,101,743
120,000 (1)Embratel Participacoes SA, ADR 2,235,000
23,000 (1)Tele Centro Sul Participacoes SA, ADR 1,569,750
140,000 Tele Norte Leste Participacoes SA, ADR 2,493,750
29,000 (1)Telesp Celular Participacoes SA, ADR 831,938
90,000 Unibanco-Uniao de Bancos Brasileiros SA, GDR 2,120,625
------------
Total 12,246,243
------------
Chile--2.0%
30,000 Banco de A. Edwards, ADR 468,750
25,800 Compania Cervecerias Unidas SA, ADR 722,400
47,000 Compania Telecomunicacion de Chile, ADR 863,625
10,000 Cristalerias de Chile, ADR 130,625
25,000 (1)Distribucion y Servicio D&S SA, ADR 443,750
48,542 Gener SA, ADR 749,367
30,000 (1)Quinenco SA, ADR 266,250
10,578 Sociedad Quimica Y Minera de Chile, ADR 300,812
------------
Total 3,945,579
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
Common Stocks--continued
Croatia--0.7%
90,000 (1)(5)Pliva D.D., GDR $ 1,076,193
33,250 (1)(5)Zagrebacka Banka, GDR 308,394
------------
Total 1,384,587
------------
Czech Republic--1.2%
24,100 (1)(5)Ceske Radiokomunikace, GDR 731,257
115,710 Ceska Sporitelna AS 553,630
50,000 (1)SPT Telecom AS 714,625
250,000 (1)Unipetrol 352,427
------------
Total 2,351,939
------------
Egypt--1.0%
64,000 (1)Al-Ahram Beverages Co., GDR 1,027,200
50,000 (1)Commercial International Bank Egypt, GDR 615,000
20,000 Suez Cement Co., Class S, GDR 323,000
------------
Total 1,965,200
------------
Greece--4.1%
9,124 Alpha Credit Bank SA 732,930
13,875 Commercial Bank of Greece 1,020,987
22,976 Goody's SA 697,406
27,500 Hellenic Bottling Co., SA 657,663
40,000 (1)Hellenic Petroleum SA 596,036
7,800 Hellenic Technodomiki SA 308,504
57,188 Hellenic Telecommunication Organization SA 1,225,626
8,881 National Bank of Greece SA 634,172
25,000 (1)STET Hellas Telecommunications SA, ADR 493,750
16,730 Sarantis SA 646,312
8,700 Titan Cement Co. SA 1,024,298
------------
Total 8,037,684
------------
Hong Kong--7.6%
500,000 Amoy Properties Ltd. 386,274
117,000 CLP Holdings Ltd. 545,342
60,000 Cheung Kong 675,980
300,000 (1)China Telecom (Hong Kong) Ltd. 1,603,039
340,000 Citic Pacific Ltd. 921,522
1,600,000 Cosco Pacific Ltd. 1,308,183
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Emerging Markets Fund
<TABLE>
<CAPTION>
Shares Value
- ----------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Hong Kong--continued
230,000 Dao Heng Bank Group Ltd. $ 1,311,917
172,900 HSBC Holdings PLC 2,281,884
100,000 Henderson Land Development Co., Ltd. 540,784
55,000 Hong Kong Electric Holdings Ltd. 173,502
100,000 Hutchison Whampoa Ltd. 1,232,859
120,000 Johnson Electric Holdings Ltd. 853,666
348,000 Li & Fung Ltd. 799,820
20,000 Sun Hung Kai Properties Ltd. 182,193
200,000 Swire Pacific Ltd., Class A 1,151,098
125,000 Television Broadcasts Ltd. 812,786
------------
Total 14,780,849
------------
Hungary--3.1%
25,354 (1)Antenna Hungaria RT 461,878
15,000 (1)(5)BorsodChem RT, GDR 458,750
15,000 Danubius Hotels RT 260,756
17,000 EGIS RT 532,346
10,000 (1)(5)MOL Magyar Olay, GDR 194,375
80,000 (1)Matav RT, ADR 2,415,000
22,000 OTP Bank RT, GDR 1,038,400
14,000 Pick Szeged RT 522,861
25,000 (1)Synergon Information Systems 183,561
------------
Total 6,067,927
------------
India--1.2%
23,800 BSES Ltd., GDR 311,780
18,000 (5)Hindalco Industries Ltd., GDR 427,500
26,500 Indian Hotels Co. Ltd., GDR 225,913
24,500 Larsen & Toubro Ltd., GDR 551,250
22,000 Ranbaxy Laboratories Ltd., GDR 502,700
26,000 (1)(5)Reliance Industries Ltd., GDR 350,350
------------
Total 2,369,493
------------
Indonesia--1.7%
770,000 PT Daya Guna Samudera 247,368
225,000 PT Gudang Garam 535,202
1,742,115 PT Indah Kiat Pulp & Paper Corp. 619,207
517,500 PT Indosat 723,368
419,345 PT Semen Gresik 624,861
1,333,800 PT Telekomunikasi Indonesia 569,805
------------
Total 3,319,811
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
Common Stocks--continued
Israel--2.3%
270,000 Bank Hapoalim Ltd. $ 712,863
560,000 Bank Leumi Le-Israel 1,032,057
2,200 Blue Square Chain Stores Investments & Properties
Ltd. 26,950
9,250 Koor Industries Ltd. 916,925
10,500 Matav-Cable Systems Media Ltd., ADR 518,438
18,500 (1)NICE-Systems Ltd., ADR 757,344
9,500 Teva Pharmaceutical Industries Ltd. 525,917
------------
Total 4,490,494
------------
Korea, Republic Of--11.0%
42,500 Dongwon Securities 1,195,169
70,000 (1)(5)Housing & Commercial Bank, GDR 1,939,000
49,520 Kookmin Bank 824,443
40,000 Korea Electric Power Corp. 1,587,233
13,000 (1)Korea Telecom, ADR 689,000
40,000 Korean Air Co. Ltd. 546,905
43,118 (1)LG Electronics, Inc., GDR 965,203
19,069 LG Information & Communication Ltd. 2,253,572
12,500 Pohang Iron and Steel Co. Ltd. 1,710,373
237 SK Telecom Co. Ltd. 547,702
16,511 SK Telecom Co. Ltd., ADR 391,104
27,875 Samsung Display Devices Co. Ltd. 1,486,025
25,027 Samsung Electronics Co. 5,181,350
14,650 Samsung Fire & Marine Insurance 650,830
12,000 Shinsegae Department Store Co. 740,134
27,000 Ssangyong Oil Refining Co. 663,791
------------
Total 21,371,834
------------
Lithuania--0.2%
50,000 Vilniaus Bankas AB, GDR 300,000
------------
Malaysia--3.4%
40,200 APM Automotive Holdings Berhad 0
110,000 Genting Berhad 382,105
375,000 Malayan Banking Berhad 1,282,895
150,000 Malaysian International Shipping Berhad 223,026
375,000 Petronas Gas Berhad 759,868
950,000 Public Bank Berhad 950,000
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Emerging Markets Fund
<TABLE>
<CAPTION>
Shares Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Malaysia--continued
200,000 Resorts World Berhad $ 536,842
100,000 Rothmans of Pall Mall (Malaysia) Berhad 710,526
268,000 Tan Chong Motor Holdings Berhad 114,958
180,000 Tanjong PLC 350,526
165,000 Telekom Malaysia Berhad 521,053
350,000 Tenaga Nasional Berhad 773,684
13,400 Warisan Tc Holdings Berhad 0
------------
Total 6,605,483
------------
Mexico--10.5%
150,000 Carso Global Telecom, Class A-1 1,178,219
370,299 Cemex SA de CV 1,811,993
550,000 Cifra SA de CV 969,112
30,000 Coca-Cola Femsa SA, ADR 461,250
260,000 (1)Corporacion GEO, SA de CV, Class B 883,133
20,310 Desc SA de CV, Class C, ADR 350,347
45,000 (1)Fomento Economico Mexicano, SA de CV, ADR 1,704,375
300,000 GPO Continental SA 445,176
249,800 Grupo Carso SA de CV 1,161,367
600,000 Grupo Elektra, SA de CV 401,231
650,000 Grupo Financiero Banamex Accival, SA de CV, Class O 2,190,585
200,000 Grupo Mexico SA, Class B 827,938
35,000 Grupo Televisa SA, GDR 1,708,437
200,000 Kimberly-Clark de Mexico, SA de CV 750,451
90,000 Organizacion Soriana SA de CV, Class B 415,561
55,000 Telefonos de Mexico SA, Class L, ADR 5,090,938
------------
Total 20,350,113
------------
Peru--1.3%
448,738 Banco Continental 268,767
35,000 CPT Telefonica del Peru SA, Class B, ADR 452,813
27,721 Cementos Lima SA 434,940
684,685 Cervecer Backus & Johnston, Class T 270,774
45,000 Cia de Minas Buenaventura SA, Class B 371,400
48,721 Credicorp Ltd. 526,187
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
Common Stocks--continued
Peru--continued
69,185 Minsur SA $ 144,734
------------
Total 2,469,615
------------
Philippines--2.0%
2,167,811 Ayala Land, Inc. 512,872
7,000,000 (1)Belle Corp. 341,463
430,000 Manila Electric Co., Class B 1,101,220
110,880 Metro Bank and Trust Co. 797,795
48,500 Philippine Long Distance Telephone Co., ADR 994,250
7,100,000 Solid Group, Inc. 207,805
------------
Total 3,955,405
------------
Poland--1.8%
20,000 (1)Agora SA 204,393
25,000 Bank Handlowy W. Warszawie 358,276
6,500 Bank Slaski SA 369,552
54,756 (1)Budimex SA 322,889
75,000 Elektrim Spolka Akcyina SA 560,320
55,000 KGHM Polska Miedz SA 301,069
25,000 (1)Orbis SA 192,059
15,000 (5)Polski Koncern Naftowy SA, GDR 154,875
15,000 Prokom Software SA, GDR 186,000
8,000 Softbank SA 232,116
50,000 (1)(5)Telekomunikacja Polska SA, GDR 281,250
50,000 WBK (Wielkopolski Bank Kreditowy SA) 279,572
------------
Total 3,442,371
------------
Romania--0.1%
15,039 (1)Alro Slatina 80,746
35,000 (1)LaFarge Romcin 68,512
341,254 (1)Sanex SA 10,879
158,826 (1)Terapia SA 39,973
------------
Total 200,110
------------
Russia--1.9%
702,000 Aeroflot 58,266
34,142 Kubanelectrosvyaz 200,472
50,000 Lukoil Holding Co. Class B, ADR 1,680,000
30,000 (1)Sun Interbrew Ltd., Class A 30,000
90,000 (1)Sun Interbrew Ltd., Class B 279,000
140,000 Surgutneftegaz 1,326,500
16,000 (1)Udmurt Telecom 9,600
------------
Total 3,583,838
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Emerging Markets Fund
<TABLE>
<CAPTION>
Shares Value
- --------------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Slovakia--0.4%
275,000 (1)(5)Slovakofarma AS, GDR $ 776,875
------------
South Africa--6.9%
75,000 ABSA Group Ltd. 282,836
40,000 ASA Ltd. 765,000
20,000 (1)Anglo American PLC 1,172,453
70,504 Bidvest Group Ltd. 600,228
50,000 (1)DataTec Ltd. 679,777
45,000 De Beers Consolidated Mines, ADR 1,209,375
70,763 Dimension Data Holdings Ltd. 366,499
30,000 Impala Platinum Holdings Ltd. 1,092,498
40,464 Imperial Holdings Ltd. 412,597
90,000 Johnnies Industries Corp. 808,449
30,000 Nedcor Ltd. 549,648
500,000 Profurn Ltd. 493,647
1,000,000 (1)Sanlam Ltd. 1,170,187
100,000 Sappi Ltd. 896,658
100,000 Sasol Ltd. 758,275
225,000 (1)South African Breweries PLC 2,112,163
------------
Total 13,370,290
------------
Taiwan, Republic Of China--1.4%
24,446 Advanced Semiconductor Engineering Inc., GDR 545,146
36,685 Asia Cement Corp., GDR 274,979
32,207 (1)GVC Corp., GDR 116,750
24,600 (1)Taiwan Semiconductor Manufacturing Co., ADR 880,988
38,016 (1)Uni-President Enterprises Co., GDR 251,856
76,146 (1)Yageo Corp., GDR 369,308
37,179 (1)Yang Ming Marine Transport, GDR 284,419
------------
Total 2,723,446
------------
Thailand--4.4%
220,000 BEC World Public Co., Ltd. 1,354,367
300,000 Bangkok Bank Public Co., Ltd. 642,555
120,000 Electricity Generating PLC 153,905
350,000 Hana Microelectronics Co., Ltd. 1,436,450
135,000 PTT Exploration and Production Public Co. 831,089
328,600 Shin Corp. PLC 2,090,363
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
Common Stocks--continued
Thailand--continued
35,000 Siam Cement Co. Ltd. $ 1,016,288
800,000 Thai Farmers Bank Co. 1,077,337
------------
Total 8,602,354
------------
Turkey--5.9%
172,443,828 Akbank T.A.S. 2,729,463
29,350,000 Akcansa Cimento AS 441,894
27,840,000 Aksigorta 1,115,072
9,700,000 Alcatel Teletas 1,085,964
15,240,000 Eregli Demir Ve Celik Fabrikalari T.A.S. 426,549
7,745,468 Koc Holding AS 986,750
537,300 Migros Turk 220,390
122,375,000 Sabanci Holding 3,956,610
7,720,000 Tupras Turkiye Petrol Rafinerileri AS 543,909
------------
Total 11,506,601
------------
Venezuela--1.2%
50,000 Compania Anonima Nacional Telefonos de Venezuela,
Class D, ADR 1,196,875
2,903,032 La Electricidad de Caracas 973,141
70,000 Mavesa SA, ADR 210,000
------------
Total 2,380,016
------------
Total Common Stocks (identified cost $132,357,245) 166,002,145
------------
Preferred Stocks--4.2%
Brazil--4.1%
50,000,000 Centrais Eletricas Brasileiras SA, Preference,
Series B 1,035,380
55,251,630 Companhia Energetica de Minas Gerais, Preference 1,039,490
120,000,000 Companhia Paranaense de Energia-Copel, Preference,
Series B 927,159
65,000,000 Gerdau SA, Preference 1,285,120
14,000,000 Petroleo Brasileiro SA, Preference 2,829,865
66,740 Telecomunicacoes de Minas Gerais, Preference,
Series B 2,049
10,000,000 Telecomunicacoes de Sao Paulo SA, Preference 962,539
------------
Total 8,081,602
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Emerging Markets Fund
<TABLE>
<CAPTION>
Principal or
Shares Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Preferred Stocks--continued
Russia--0.1%
1,540,550 (1)Karelia Electrosvyaz, Pfd. $ 19,257
2,000,000 Surgutneftegaz, Pfd. 110,938
------------
Total 130,195
------------
Total Preferred Stocks (identified cost
$7,676,535) 8,211,797
------------
Rights--0.1%
Korea, Republic Of--0.1%
3,649 (1)SK Telecom Co. Ltd., Rights 54,045
2,096 (1)Shinsegae Department Store Co., Rights 48,449
------------
Total 102,494
------------
Greece--0.0%
7,800 (1)Hellenic Technodomiki, Rights 30,013
------------
Total Rights (identified cost $0) 132,507
------------
Warrants--0.0%
Indonesia--0.0%
109,374 (1)PT Bank Dagang Nasional Indonesia 0
148,486 (1)PT Bank Internasional Indonesia 20
233,350 (1)PT Bank Pan Indonesia 5,423
163,544 (1)PT Indah Kiat Pulp & Paper Corp. 33,536
------------
Total 38,979
------------
Philippines--0.0%
500,000 (1)Belle Corp. 3,537
------------
Thailand--0.0%
9,375 (1)Thai Farmers Bank Co. 1,996
------------
Total Warrants (identified cost $12,455) 44,512
------------
Convertible Bond--0.0%
Brazil--0.0%
$ 53,500 Companhia Vale do Rio Doce, Conv. Deb., 12/31/1999
(identified cost $417) 278
------------
</TABLE>
<TABLE>
<CAPTION>
Principal or
Shares Value
<C> <S> <C>
Closed-End Investment Companies--6.0%
Bulgaria--0.2%
65,000 Framlington Bulgaria Fund $ 284,375
------------
India--1.7%
35,000 (1)India Fund, Inc. 492,188
10,000 (1)India I.T. Fund 477,500
175,000 (1)The Morgan Stanley India Investment Fund, Inc. 2,362,500
------------
Total 3,332,188
------------
Romania--0.5%
2,200 (1)Romania Investment Fund Ltd. 962,500
------------
South Africa--0.7%
102,457 Southern Africa Fund, Inc. 1,363,959
------------
Taiwan, Republic Of China--2.8%
90,000 Formosa Growth Fund Ltd. 2,009,700
185,000 (1)ROC Taiwan Fund 1,480,000
110,000 Taiwan Fund, Inc. 2,028,125
------------
Total 5,517,825
------------
Ukraine--0.1%
6,667 (1)Societe Generale Ukraine Fund 243,346
------------
Total Closed-End Investment Companies (identified
cost $11,239,866) 11,704,193
------------
Open-End Investment Company--0.9%
United States--0.9%
1,795,485 (1)Bank of New York Cash Reserve Fund (at cost) 1,795,485
------------
(3) Repurchase Agreement--3.2%
$ 6,189,219 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999,
due 12/1/1999 (at amortized cost) 6,189,219
------------
Total Investments (identified cost $159,271,222) $194,080,136
------------
</TABLE>
(See Notes to Portfolios of Investments)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Personal Equity Fund (Class A Shares)
Growth of $10,000 Invested in Wachovia Emerging Markets Fund (Class A Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Personal Equity Fund (Class A Shares) (the "Fund") from July 30, 1999
(start of performance) to November 30, 1999 compared to the Standard & Poor's
500 Index (S&P 500).+
[Please see Appendix A16]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund after deducting
the maximum sales charge of 4.50% ($10,000 investment minus $450 sales
charge = $9,550). The Fund's performance assumes the reinvestment of
dividends on securities in the indices.
** Total return quoted reflects all applicable sales charges and contingent
deferred sales charges.
+ The S&P 500 is an unmanaged index comprised of common stocks in industry,
transportation, and financial and public utility companies. The S&P 500 is
not adjusted to reflect sales charges, expenses, or other fees than the SEC
requires to be reflected in the Fund's performance. Investments cannot be
made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Personal Equity Fund (Class Y Shares)
Growth of $10,000 Invested in Wachovia Personal Equity Fund (Class Y Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Personal Equity Fund (Class Y Shares) (the "Fund") from July 30, 1999
(start of performance) to November 30, 1999 compared to the Standard & Poor's
500 Index (S&P 500).+
[Please see Appendix A17]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* The Fund's performance assumes the reinvestment of all dividends and
distributions. The S&P 500 has been adjusted to reflect the reinvestment of
dividends on securities in the index.
+ The S&P 500 is an unmanaged index comprised of common stocks in industry,
transportation, and financial and public utility companies. The S&P 500 is
not adjusted to reflect sales charges, expenses, or other fees that the SEC
requires to be reflected in the Fund's performance. Investments cannot be
made in an index.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Personal Equity Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Shares Value
- -----------------------------------------------------------------------
<C> <S> <C>
Common Stocks--93.8%
Basic Materials--3.6%
153,436 Du Pont (E.I.) de Nemours & Co. $ 9,119,852
114,980 Weyerhaeuser Co. 7,042,525
------------
Total 16,162,377
------------
Capital Goods--7.9%
114,754 General Electric Co. 14,918,020
260,996 Tyco International Ltd. 10,456,152
169,033 United Technologies Corp. 9,550,365
------------
Total 34,924,537
------------
Communication Services--6.0%
94,765 AT&T Corp. 5,294,994
204,992 (1)MCI Worldcom, Inc. 16,950,276
43,151 (1)Qwest Communications International, Inc. 1,475,225
65,955 Vodafone AirTouch PLC, ADR 3,112,252
------------
Total 26,832,747
------------
Consumer Cyclicals--6.4%
71,145 Carnival Corp. 3,139,273
44,664 Circuit City Stores, Inc. 2,166,204
38,307 (1)Federated Department Stores, Inc. 1,802,823
21,771 Gannett Co., Inc. 1,557,987
44,466 Home Depot, Inc. 3,515,593
27,801 Lowe's Cos., Inc. 1,384,837
48,741 Marriott International, Inc., Class A 1,587,129
33,364 McGraw-Hill Cos., Inc. 1,891,322
194,722 Wal-Mart Stores, Inc. 11,220,855
------------
Total 28,266,023
------------
Consumer Staples--8.4%
85,954 CBS Corp. 4,469,608
63,325 CVS Corp. 2,513,211
71,498 (1)Clear Channel Communications, Inc. 5,746,652
126,785 Comcast Corp., Class A 5,729,097
166,332 (1)Kroger Co. 3,544,951
143,652 PepsiCo, Inc. 4,964,972
12,704 Procter & Gamble Co. 1,372,032
76,564 (1)Safeway, Inc. 2,823,298
102,597 Time Warner, Inc. 6,328,952
------------
Total 37,492,773
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
Common Stocks--continued
Energy--6.5%
175,183 Exxon Mobil Corp. $ 13,894,202
141,969 Royal Dutch Petroleum Co., ADR 8,234,202
112,073 Schlumberger Ltd. 6,731,384
------------
Total 28,859,788
------------
Finance--16.7%
78,020 American Express Co. 11,805,401
111,177 American International Group, Inc. 11,479,025
59,304 Bank One Corp. 2,090,466
61,481 Bank of New York Co., Inc. 2,451,555
79,627 Chase Manhattan Corp. 6,151,185
261,387 Citigroup, Inc. 14,082,225
48,987 Fannie Mae 3,263,759
153,000 Freddie Mac 7,554,375
41,931 MBIA, Inc. 2,096,550
32,411 Marsh & McLennan Cos., Inc. 2,548,315
11,532 Merrill Lynch & Co., Inc. 929,768
43,937 SunTrust Banks, Inc. 3,070,098
145,826 Wells Fargo Co. 6,780,909
------------
Total 74,303,631
------------
Healthcare--10.7%
121,486 Abbott Laboratories 4,616,468
154,988 Bristol-Myers Squibb Co. 11,323,811
57,269 Johnson & Johnson 5,941,658
50,139 Lilly (Eli) & Co. 3,597,473
102,128 Merck & Co., Inc. 8,017,048
265,671 Pfizer, Inc. 9,613,969
84,418 Schering Plough Corp. 4,315,870
------------
Total 47,426,297
------------
Technology--24.9%
85,098 (1)America Online, Inc. 6,185,561
200,030 (1)Cisco Systems, Inc. 17,840,176
131,765 (1)EMC Corp. 11,010,613
120,000 Intel Corp. 9,202,500
81,072 International Business Machines Corp. 8,355,483
112,936 Lucent Technologies, Inc. 8,251,386
174,755 (1)Microsoft Corp. 15,910,897
43,259 Nokia Oyj, Class A, ADR 5,977,853
129,980 (1)Sun Microsystems, Inc. 17,189,855
111,288 Texas Instruments, Inc. 10,690,604
------------
Total 110,614,928
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Personal Equity Fund
<TABLE>
<CAPTION>
Shares or
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Utilities--2.7%
95,300 Duke Energy Corp. $ 4,830,519
104,900 Enron Corp. 3,992,756
145,580 Southern Co. 3,402,933
------------
Total 12,226,208
------------
Total Common Stocks (identified cost $233,368,167) 417,109,309
------------
U.S. Government Agency--4.5%
Finance--4.5%
$20,000,000 (2)Federal Home Loan Mortgage Corp., Discount Bond,
12/17/1999 (identified cost $19,953,778) 19,953,778
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
U.S. Treasury Obligation--0.4%
$ 2,000,000 (2)United States Treasury Bill, 12/16/1999
(identified cost $1,996,046) $ 1,996,046
------------
(3) Repurchase Agreement--1.6%
7,169,987 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999,
due 12/1/1999 (at amortized cost) 7,169,987
------------
Total Investments (identified cost $262,487,978) $446,229,120
------------
</TABLE>
(See Notes to Portfolios of Investments)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Balanced Fund (Class A Shares)
Growth of $10,000 Invested in Wachovia Balanced Fund (Class A Shares) The
graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Balanced Fund (Class A Shares) (the "Fund") from May 7, 1993 (start of
performance) to November 30, 1999 compared to the Standard and Poor's 500 Index
(S&P 500)+ and the Lehman Brothers Aggregate Bond Index (LBABI).+
[Please see Appendix A18]
Past performance is no guarantee of future results. Your 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. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund after deducting
the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge
= $9,550). The Fund's performance assumes the reinvestment of all dividends
and distributions. The S&P 500 and the LBABI have been adjusted to reflect
the reinvestment of dividends on securities in the indices.
** Total returns quoted reflect all applicable sales charges and contingent
deferred sales charges.
+ The S&P 500 is an unmanaged index comprised of common stocks in industry,
transportation, and financial and public utility companies. The LBABI is an
unmanaged index measuring both the capital price changes and income provided
by the underlying universe of securities, comprised of U.S. Treasury
obligations, U.S. agency obligations, foreign obligations, U.S. investment-
grade corporate debt and mortgage-backed obligations. The S&P 500 and the
LBABI are not adjusted to reflect sales charges, expenses, or other fees
that the SEC requires to be reflected in the Fund's performance. Investments
cannot be made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Balanced Fund (Class B Shares)
Growth of $10,000 Invested in Wachovia Balanced Fund (Class B Shares) The
graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Balanced Fund (Class B Shares) (the "Fund") from July 23, 1996 (start
of performance) to November 30, 1999 compared to the Standard and Poor's 500
Index (S&P 500)+ and the Lehman Brothers Aggregate Bond Index (LBABI).+
[Please see Appendix A19]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund. The ending
value of the Fund reflects a 3.00% contingent deferred sales charge on any
redemption less than four years from the purchase date. The maximum
contingent deferred sales charge is 5.00% on any redemption less than one
year from the purchase date. The Fund's performance assumes the reinvestment
of all dividends and distributions. The S&P 500 and the LBABI have been
adjusted to reflect the reinvestment of dividends on securities in the
indices.
** Total returns quoted reflect all applicable sales charges and contingent
deferred sales charges.
+ The S&P 500 is an unmanaged index comprised of common stocks in industry,
transportation, and financial and public utility companies. The LBABI is an
unmanaged index measuring both the capital price changes and income provided
by the underlying universe of securities, comprised of U.S. Treasury
obligations, U.S. agency obligations, foreign obligations, U.S. investment-
grade corporate debt and mortgage-backed obligations. The S&P 500 and the
LBABI are not adjusted to reflect sales charges, expenses, or other fees
that the SEC requires to be reflected in the Fund's performance. Investments
cannot be made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Balanced Fund (Class Y Shares)
Growth of $10,000 Invested in Wachovia Balanced Fund (Class Y Shares) The
graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Balanced Fund (Class Y Shares) (the "Fund") from July 23, 1996 (start
of performance) to November 30, 1999 compared to the Standard and Poor's 500
Index (S&P 500)+ and the Lehman Brothers Aggregate Bond Index (LBABI).+
[Please see Appendix A20]
Past performance is no guarantee of future results. Your 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. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* The Fund's performance assumes the reinvestment of all dividends and
distributions. The S&P 500 and the LBABI have been adjusted to reflect the
reinvestment of dividends on securities in the indices.
+ The S&P 500 is an unmanaged index comprised of common stocks in industry,
transportation, and financial and public utility companies. The LBABI is an
unmanaged index measuring both the capital price changes and income provided
by the underlying universe of securities, comprised of U.S. Treasury
obligations, U.S. agency obligations, foreign obligations, U.S. investment-
grade corporate debt and mortgage-backed obligations. The S&P 500 and the
LBABI are not adjusted to reflect sales charges, expenses, or other fees
that the SEC requires to be reflected in the Fund's performance. Investments
cannot be made in an index.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Balanced Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Shares Value
- ----------------------------------------------------------------------------
<C> <S> <C>
Common Stocks--60.5%
Basic Materials--2.4%
45,614 Air Products & Chemicals, Inc. $ 1,476,753
32,004 Alcoa, Inc. 2,096,262
14,898 Dow Chemical Co. 1,744,928
21,193 Du Pont (E.I.) de Nemours & Co. 1,259,658
65,782 Rohm & Haas Co. 2,409,266
112,696 Weyerhaeuser Co. 6,902,630
------------
Total 15,889,497
------------
Capital Goods--4.0%
88,067 General Electric Co. 11,448,710
51,243 Ingersoll-Rand Co. 2,482,082
167,348 Tyco International Ltd. 6,704,379
96,977 United Technologies Corp. 5,479,201
------------
Total 26,114,372
------------
Communication Services--4.0%
135,354 AT&T Corp. 7,562,877
153,725 (1)MCI Worldcom, Inc. 12,711,136
44,207 (1)NEXTEL Communications, Inc., Class A 4,382,019
32,059 Vodafone AirTouch PLC, ADR 1,512,784
------------
Total 26,168,816
------------
Consumer Cyclicals--3.8%
72,681 Black & Decker Corp. 3,261,560
55,949 Carnival Corp. 2,468,750
24,657 (1)Federated Department Stores, Inc. 1,160,420
69,047 Lowe's Cos., Inc. 3,439,403
68,515 McGraw-Hill Cos., Inc. 3,883,944
51,949 Nordstrom, Inc. 1,444,832
32,555 Tandy Corp. 2,494,526
108,665 Wal-Mart Stores, Inc. 6,261,821
------------
Total 24,415,256
------------
Consumer Staples--5.8%
86,402 (1)AT&T Corp.--Liberty Media Group, Inc., Class A 3,612,684
97,782 CBS Corp. 5,084,664
124,820 CVS Corp. 4,953,794
52,131 (1)Clear Channel Communications, Inc. 4,190,029
108,020 Comcast Corp., Class A 4,881,153
248,006 (1)Kroger Co., Inc. 5,285,628
129,164 (1)Outback Steakhouse, Inc. 3,043,415
104,590 Time Warner, Inc. 6,451,896
------------
Total 37,503,263
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
Common Stocks--continued
Energy--3.7%
71,600 BP Amoco PLC, ADR $ 4,363,125
81,547 Baker Hughes, Inc. 2,059,062
33,019 Burlington Resources, Inc. 1,110,264
173,255 Conoco, Inc., Class A 4,558,772
91,619 Exxon Corp. 7,266,532
46,045 Schlumberger Ltd. 2,765,578
34,691 Texaco, Inc. 2,113,983
------------
Total 24,237,316
------------
Finance--10.1%
50,058 American Express Co. 7,574,401
16,240 American General Corp. 1,190,595
86,836 American International Group, Inc. 8,965,817
23,698 Associates First Capital Corp., Class A 787,958
56,445 Bank One Corp. 1,989,686
87,904 Bank of America Corp. 5,142,384
40,816 Bank of New York Co., Inc. 1,627,538
55,441 Chase Manhattan Corp. 4,282,817
212,526 Citigroup, Inc. 11,449,838
36,164 Fannie Mae 2,409,426
74,115 Freddie Mac 3,659,428
29,187 First Union Corp. 1,129,172
33,712 MBIA Inc. 1,685,600
74,615 MBNA Corp. 1,884,028
25,547 Marsh & McLennan Cos., Inc. 2,008,633
19,318 Merrill Lynch & Co., Inc. 1,557,514
50,648 SunTrust Banks, Inc. 3,539,029
110,077 Wells Fargo Co. 5,118,581
------------
Total 66,002,445
------------
Healthcare--6.6%
42,521 Abbott Laboratories 1,615,798
37,680 (1)Amgen, Inc. 1,716,795
92,413 Bristol-Myers Squibb Co. 6,751,925
21,891 Guidant Corp. 1,094,550
79,589 Johnson & Johnson 8,257,359
44,980 Lilly (Eli) & Co. 3,227,315
73,412 Medtronic, Inc. 2,853,892
78,763 Merck & Co., Inc. 6,182,894
135,706 Pfizer, Inc. 4,910,861
23,832 Pharmacia & Upjohn, Inc. 1,303,313
22,378 Schering Plough Corp. 1,144,075
40,297 Warner-Lambert Co. 3,614,137
------------
Total 42,672,914
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Balanced Fund
<TABLE>
<CAPTION>
Shares or
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Common Stocks--continued
Technology--17.4%
93,676 (1)America Online, Inc. $ 6,809,074
168,502 (1)Cisco Systems, Inc. 15,028,272
109,002 (1)EMC Corp. 9,108,479
107,727 Intel Corp. 8,261,314
56,485 International Business Machines Corp. 5,821,485
46,875 (1)JDS Uniphase Corp. 10,722,656
95,491 Lucent Technologies, Inc. 6,976,778
144,942 (1)Microsoft Corp. 13,196,516
33,405 (1)Network Appliance, Inc. 3,931,351
29,757 Nokia Oyj, Class A, ADR 4,112,045
93,752 (1)Sun Microsystems, Inc. 12,398,702
81,881 Texas Instruments, Inc. 7,865,693
95,424 (1)Veritas Software Corp. 8,737,260
------------
Total 112,969,625
------------
Transportation--0.7%
50,535 Burlington Northern Santa Fe 1,465,515
198,447 Southwest Airlines Co. 3,237,167
------------
Total 4,702,682
------------
Utilities--2.0%
48,683 Consolidated Edison Co. 1,679,564
87,372 Duke Energy Corp. 4,428,668
96,214 Enron Corp. 3,662,145
136,645 Southern Co. 3,194,077
------------
Total 12,964,454
------------
Total Common Stocks (identified cost $266,202,281) 393,640,640
------------
Asset Backed Securities--2.0%
$4,000,000 American Express Credit Account Master Trust 1997-1,
Class A, 6.40%, 4/15/2005 3,976,240
1,000,000 AT&T Universal Card Master Trust 1995-2, Class A,
5.95%, 10/17/2002 996,560
2,025,000 Carco Auto Loan Master Trust 1999-4, Class A, 6.43%,
11/15/2004 2,012,850
1,350,000 Chase Credit Card Master Trust, Class A, 6.30%,
4/15/2003 1,349,568
7,938,170 Deutsche Mortgage and Asset Receiving Corp. 1998-C1,
Class X, 1.242%, 2/15/2023 401,870
629,500 Deutsche Mortgage and Asset Receiving Corp. 1998-C1,
Class D, 7.23%, 6/15/2031 547,124
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
Asset Backed Securities--continued
$2,100,000 DLJ Commercial Mortgage Corp. 1999-CG1, Class A1B,
6.46%, 1/10/2009 $ 1,992,417
1,000,000 First Omni Bank Credit Card Master Trust 1996-A,
Class A, 6.65%, 9/15/2003 1,000,000
628,028 First Plus Home Loan Trust 1997-1, Class A4, 6.60%,
7/10/2010 627,079
138,558 Prudential Home Mortgage Securities 1993-60, Class
A1, 6.75%, 12/25/2023 138,212
------------
Total Asset Backed Securities (identified cost
$13,581,010) 13,041,920
------------
Corporate Bonds--12.9%
Basic Materials--0.5%
1,365,000 Du Pont (E.I.) de Nemours & Co., Note, 6.75%,
10/15/2004 1,357,806
1,330,000 Nalco Chemical Co., Bond, 6.25%, 5/15/2008 1,175,946
750,000 Temple-Inland, Inc., Unsecd. Note, 7.25%, 9/15/2004 734,753
------------
Total 3,268,505
------------
Communication Services--1.2%
2,500,000 AT&T Corp., Global Bond, 6.00%, 3/15/2009 2,295,275 1,000,000 New
England Telephone & Telegraph, Note, 5.875%,
4/15/2009 909,220
3,980,000 New York Telephone Co., Deb., 6.00%, 4/15/2008 3,685,958
1,300,000 Southwestern Bell Telephone Co., Note, 7.00%,
8/26/2002 1,307,501
------------
Total 8,197,954
------------
Consumer Cyclicals--0.3%
2,000,000 Tribune Co., Note, 6.25%, 11/10/2026 1,970,880
------------
Consumer Staples--0.1%
750,000 Archer-Daniels-Midland Co., Note, 6.625%, 5/1/2029 652,388
------------
Finance--8.1%
1,000,000 American General Finance Corp., Sr. Note, 6.52%,
6/23/2000 1,001,610
2,500,000 Aon Capital Trust A, Company Guarantee, 8.205%,
1/1/2027 2,555,025
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Balanced Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Corporate Bonds--continued
Finance--continued
$ 1,100,000 Associates Corp. of North America, Sr. Note, 6.50%,
7/15/2002 $ 1,092,553
1,000,000 Associates Corp. of North America, Sr. Note, 6.50%,
10/15/2002 992,170
750,000 Bank of America Corp., Note, 6.625%, 6/15/2004 737,783
865,000 Bankers Trust Corp., Sub. Note, 7.375%, 5/1/2008 854,352
1,000,000 Bear Stearns Cos., Inc., Sr. Note, 6.50%, 7/5/2000 999,180
2,000,000 CIT Group, Inc., Sr. Note, 6.375%, 10/1/2002 1,968,600
500,000 Caterpillar Financial Services Corp., MTN, 6.50%,
10/15/2002 495,875
3,000,000 Chase Manhattan Corp., Sr. Note, 5.15%, 12/15/2000 2,962,290
1,605,000 Chase Manhattan Corp., Sr. Note, 6.75%, 12/1/2004 1,590,074
1,492,839 Chase Manhattan Bank First Union National, Class
A1, 7.134%, 7/15/2007 1,488,003
1,075,000 Commercial Credit Co., Deb., 8.70%, 6/15/2010 1,182,704
1,000,000 Commercial Credit Co., Note, 6.50%, 8/1/2004 978,060
1,000,000 Countrywide Home Loans, Inc., Company Guarantee,
6.05%, 3/1/2001 992,510
1,000,000 DaimlerChrysler North America Holding Corp. ,
6.63%, 9/21/2001 999,200
1,000,000 Distribution Financial Services RV Trust, 6.48%,
10/15/2013 989,250
1,937,174 Federal National Mortgage Association, Class J,
7.00%, 2/25/2021 1,940,196
1,000,000 Ford Motor Credit Corp., Note, 7.00%, 9/25/2001 1,004,110
1,500,000 General Motors Acceptance Corp., Note, 6.625%,
10/1/2002 1,491,345
1,000,000 Goldman Sachs Group, Inc., Sr. Unsub., 6.65%,
5/15/2009 946,750
1,500,000 Hartford Life, Inc., Note, 7.10%, 6/15/2007 1,472,280
1,295,000 Household Finance Corp., Note, 6.00%, 5/1/2004 1,240,468
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
Corporate Bonds--continued
Finance--continued
$ 2,750,000 IBM Credit Corp., MTN, 5.79%, 3/20/2010 (Callable
3/20/2000 @100) $ 2,746,645
1,000,000 KFW International Finance, Company Guarantee,
8.25%, 11/30/2004 1,057,682
1,500,000 KFW International Finance, Note, 7.00%, 3/1/2013 1,452,840
735,000 Landeskreditbank B-W, Sub. Note, 7.875%, 4/15/2004 758,300
2,000,000 Lehman Brothers Holdings, Inc., Bond, 7.00%,
5/15/2003 1,974,840
1,000,000 Lehman Brothers Holdings, Inc., Note, 6.125%,
7/15/2003 960,690
2,500,000 Merrill Lynch & Co., Inc., Bond, 6.00%, 7/15/2005 2,372,900
500,000 Merrill Lynch & Co., Inc., Note, 7.375%, 5/15/2006 505,155
1,000,000 Morgan Stanley, Dean Witter & Co., Sr. Note, Series
C, MTN, 5.875%, 2/28/2001 989,560
750,000 Morgan Stanley, Dean Witter & Co., Unsecd. Note,
Series I, 7.07%, 2/10/2014 723,945
750,000 National Rural Utilities Cooperative Finance Corp.,
Collateral Trust, 5.75%, 11/1/2008 678,818
1,000,000 NationsBank Corp., MTN, 6.94%, 4/12/2002 1,003,580
1,000,000 NationsBank Corp., Sub. Note, 6.875%, 2/15/2005 989,230
3,500,000 Norwest Financial, Inc., Sr. Note, 6.375%,
9/15/2002 3,462,795
1,000,000 Norwest Financial, Inc., Sr. Note, 6.625%,
7/15/2004 985,820
2,380,000 Union Planters Corp., Sub. Note, 6.50%, 3/15/2018 2,136,621
------------
Total 52,773,809
------------
Industrial Services--0.2%
1,335,000 WMX Technologies, Inc., Note, 8.00%, 4/30/2004 1,240,896
------------
Technology--0.9%
4,250,000 Eastman Kodak Co., Note, 6.50%, 8/15/2001 4,227,050
1,500,000 Motorola, Inc., Sr. Deb., 6.50%, 9/1/2025 1,469,580
------------
Total 5,696,630
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Balanced Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Corporate Bonds--continued
Utilities--1.6%
$ 680,000 GTE California, Inc. , Deb., Series G, 5.50%,
1/15/2009 $ 602,949
1,750,000 General Electric Capital Corp., 6.81%, 11/3/2003 1,755,863
1,956,367 General Services Administration--Rosecliff Realty,
Note, 8.00%, 11/15/2008 2,025,661
3,060,000 National Fuel Gas Co., Series D, MTN, 6.303%,
5/27/2008 2,845,219
1,500,000 Ontario Hydro, Sr. Note, 6.10%, 1/30/2008 1,410,000
1,500,000 Virginia Electric Power Co., 1st Ref. Mtg., Series
B, 6.625%, 4/1/2003 1,486,665
------------
Total 10,126,357
------------
Total Corporate Bonds (identified cost $86,880,925) 83,927,419
------------
Mortgage Backed Securities--13.2%
Federal Home Loan Bank--0.1%
1,000,000 5.40%, 3/1/2004 954,690
------------
Federal Home Loan Mortgage Corporation--0.5%
575,399 6.00%, 10/1/2000 572,913
1,364,191 6.00%, 8/1/2013 1,307,059
139,376 6.50%, 12/1/2008 137,347
32,407 6.50%, 2/1/2009 31,935
439,188 6.50%, 3/1/2009 432,793
36,704 6.50%, 4/1/2009 36,170
177,724 6.50%, 6/1/2009 175,136
185,441 6.50%, 7/1/2010 182,469
388,700 7.00%, 2/1/2023 381,898
------------
Total 3,257,720
------------
Federal National Mortgage Association--8.1%
5,869,000 5.13%, 2/13/2004 5,559,058
688,719 6.00%, 12/1/2010 663,533
1,120,970 6.00%, 4/1/2011 1,077,880
5,038,794 6.00%, 12/1/2012 4,835,630
1,624,423 6.00%, 1/1/2013 1,558,926
3,313,211 6.00%, 4/1/2013 3,179,622
2,009,736 6.00%, 7/1/2013 1,924,946
1,699,171 6.13%, 9/1/2008 1,595,641
2,378,111 6.50%, 7/1/2013 2,325,341
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
Mortgage Backed Securities--continued
Federal National Mortgage Association--continued
$ 1,040,709 6.50%, 1/1/2028 $ 992,576
12,335,055 6.50%, 2/1/2029 11,764,559
5,437,924 6.50%, 8/1/2029 5,186,420
5,432,997 6.50%, 10/1/2029 5,181,721
490,569 6.54%, 12/1/2007 473,739
1,855,157 6.56%, 12/1/2007 1,793,525
2,425,777 7.06%, 8/1/2006 2,418,385
816,427 7.50%, 4/1/2007 824,592
422,576 7.50%, 9/1/2022 423,434
111,329 8.00%, 6/1/2022 113,278
151,374 8.00%, 1/1/2023 153,928
16,757 8.50%, 8/1/2016 17,342
10,118 8.50%, 6/1/2024 10,424
124,763 8.50%, 7/1/2024 128,544
10,454 8.50%, 10/1/2024 10,770
186,446 8.50%, 12/1/2024 192,096
20,094 10.50%, 6/1/2001 20,195
------------
Total 52,426,105
------------
Government National Mortgage Association--4.2%
3,682,982 6.00%, 2/15/2029 3,402,155
3,139,879 6.00%, 2/15/2029 2,900,463
3,029,143 6.00%, 2/15/2029 2,795,263
5,990,335 6.00%, 3/15/2029 5,533,572
650,471 6.50%, 10/15/2008 641,065
884,910 6.50%, 12/15/2012 866,654
856,861 6.50%, 2/15/2013 839,449
792,438 6.50%, 2/15/2013 776,336
710,062 6.50%, 2/15/2013 695,413
347,871 6.50%, 3/15/2024 333,413
1,985,631 6.50%, 4/15/2029 1,888,832
1,903,209 6.50%, 4/15/2029 1,810,428
516,030 7.00%, 5/15/2023 506,674
1,099,648 7.00%, 8/15/2023 1,079,712
254,338 7.00%, 8/15/2023 249,727
608,113 7.00%, 12/20/2025 591,390
280,835 7.50%, 3/15/2023 281,186
985,701 7.50%, 8/15/2027 983,543
414,769 8.00%, 10/15/2022 422,674
162,864 8.00%, 6/15/2023 165,968
51,281 9.00%, 3/15/2009 54,073
39,343 9.00%, 11/15/2016 41,531
79,869 9.00%, 11/15/2019 84,361
242,616 9.00%, 12/15/2019 256,260
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Balanced Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- ------------------------------------------------------------------------------
<C> <S> <C>
Mortgage Backed Securities--continued
Government National Mortgage Association--
continued
$ 134,506 9.00%, 1/15/2021 $ 141,734
27,462 9.00%, 4/15/2021 28,938
------------
Total 27,370,814
------------
Tennessee Valley Authority--0.3%
2,200,000 Tennessee Valley Authority, Bond, 5.28%, 9/14/2001 2,161,852
------------
Total Mortgage Backed Securities (identified cost
$89,336,514) 86,171,181
------------
(2) U.S. Treasury Obligations--7.7%
U.S. Treasury Bill--0.2%
1,100,000 12/16/1999 1,098,636
------------
U.S. Treasury Bonds--5.5%
5,400,000 6.125%, 11/15/2027 5,141,826
11,625,000 6.375%, 8/15/2027 11,423,423
16,079,000 (2)7.125%, 2/15/2023 17,144,234
1,900,000 8.125%, 8/15/2019 2,212,018
------------
Total 35,921,501
------------
U.S. Treasury Notes--2.0%
1,000,000 5.50%, 5/31/2000 999,370
8,210,000 5.875%, 11/15/2005 8,076,588
1,000,000 5.875%, 9/30/2002 995,160
2,955,000 7.875%, 11/15/2004 3,161,850
------------
Total 13,232,968
------------
Total U.S. Treasury Obligations (identified cost
$52,125,657) 50,253,105
------------
</TABLE>
<TABLE>
<CAPTION>
Shares or
Principal
Amount Value
<C> <S> <C>
Closed-End Investment Companies--1.8%
44,000 2002 Target Term Trust, Inc. $ 596,750
338,501 Blackrock 2001 Term Trust, Inc. 3,004,196
30,600 Blackrock Advantage Term Trust 277,313
222,900 Blackrock Strategic Term Trust, Inc. 1,964,306
329,711 Blackrock Target Term Trust 3,152,861
55,900 RCM Strategic Global Government Fund 492,619
12,500 TCW/DW Term Trust 2002 116,406
124,800 TCW/DW Term Trust 2003 1,138,800
153,700 Templeton Global Income Fund 941,413
------------
Total Closed-End Investment Companies (identified
cost $11,640,672) 11,684,664
------------
(3) Repurchase Agreement--1.5%
$9,709,927 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999,
due 12/1/1999 (at amortized cost) 9,709,927
------------
Total Investments (identified cost $529,476,986) $648,428,856
------------
</TABLE>
(See Notes to Portfolios of Investments)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Fixed Income Fund (Class A Shares)
Growth of $10,000 Invested in Wachovia Fixed Income Fund (Class A Shares) The
graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Fixed Income Fund (Class A Shares) (the "Fund") from May 7, 1993 (start
of performance) to November 30, 1999 compared to the Lehman Brothers Aggregate
Bond Index (LBABI).+
[Please see Appendix A21]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund after deducting
the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge
= $9,550). The Fund's performance assumes the reinvestment of all dividends
and distributions. The LBABI has been adjusted to reflect the reinvestment of
dividends on securities in the index.
** Total returns quoted reflect all applicable sales charges and contingent
deferred sales charges.
+ The LBABI is an unmanaged index measuring both the capital price changes and
income provided by the underlying universe of securities, comprised of U.S.
Treasury obligations, U.S. agency obligations, foreign obligations, U.S.
investment-grade corporate debt and mortgage-backed obligations. The LBABI is
not adjusted to reflect sales charges, expenses, or other fees that the SEC
requires to be reflected in the Fund's performance. Investments cannot be
made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Fixed Income Fund (Class B Shares)
Growth of $10,000 Invested in Wachovia Fixed Income Fund (Class B Shares) The
graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Fixed Income Fund (Class B Shares) (the "Fund") from July 23, 1996
(start of performance) to November 30, 1999 compared to the Lehman Brothers
Aggregate Bond Index (LBABI).+
[Please see Appendix A22]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund. The ending value
of the Fund reflects a 3.00% contingent deferred sales charge on any
redemption less than four years from the purchase date. The maximum
contingent deferred sales charge is 5.00% on any redemption less than one
year from the date of purchase. The Fund's performance assumes the
reinvestment of all dividends and distributions. The LBABI has been adjusted
to reflect the reinvestment of dividends on securities in the index.
** Total returns quoted reflect all applicable sales charges and contingent
deferred sales charges.
+ The LBABI is an unmanaged index measuring both the capital price changes and
income provided by the underlying universe of securities, comprised of U.S.
Treasury obligations, U.S. agency obligations, foreign obligations, U.S.
investment-grade corporate debt and mortgage-backed obligations. The LBABI is
not adjusted to reflect sales charges, expenses, or other fees that the SEC
requires to be reflected in the Fund's performance. Investments cannot be
made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Fixed Income Fund (Class Y Shares)
Growth of $10,000 Invested in Wachovia Fixed Income Fund (Class Y Shares) The
graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Fixed Income Fund (Class Y Shares) (the "Fund") from July 23, 1996
(start of performance) to November 30, 1999 compared to the Lehman Brothers
Aggregate Bond Index (LBABI).+
[Please see Appendix A23]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* The Fund's performance assumes the reinvestment of all dividends and
distributions. The LBABI has been adjusted to reflect the reinvestment of
dividends on securities in the index.
+ The LBABI is an unmanaged index measuring both the capital price changes and
income provided by the underlying universe of securities, comprised of U.S.
Treasury obligations, U.S. agency obligations, foreign obligations, U.S.
investment-grade corporate debt and mortgage-backed obligations. The LBABI is
not adjusted to reflect sales charges, expenses, or other fees that the SEC
requires to be reflected in the Fund's performance. Investments cannot be
made in an index.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Fixed Income Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Asset-Backed Securities--7.3%
Finance--7.3%
$11,575,000 American Express Credit Account Master Trust,
Series 1997-1, Class A, 6.40%, 4/15/2005 $ 11,506,245
8,020,000 Carco Auto Loan Master Trust, Series 1999-4, Class
A, 6.43%, 11/15/2004 7,971,880
640,000 Chase Manhattan Credit Card Master Trust, Series
1996-3, Class A, 7.04%, 2/15/2005 643,597
2,300,000 Circuit City Credit Card Master Trust, Series 1995-
1, Class A, 6.375%, 8/15/2005 2,298,114
4,880,000 DLJ Commercial Mortgage Corp., Series 1999-CG1,
Class A1B, 6.46%, 1/10/2009 4,629,998
3,250,000 Distribution Financial Services RV Trust, Series 1999-1, Class A5,
5.97%, 8/15/2013 3,187,893
2,905,762 Federal National Mortgage Association, Class J,
7.00%, 2/25/2021 2,910,295
942,042 First Plus Home Loan Trust, Series 1996-4, Class
A4, 6.60%, 7/10/2010 940,619
1,885,000 First USA Credit Card Master Trust, Series 1997-6, Class A, 6.42%,
3/17/2005 1,876,744
5,000,000 Prime Credit Card Master Trust, Series 1996-1,
Class A, 6.70%, 7/15/2004 5,003,100
------------
Total Asset-Backed Securities (identified cost
$41,520,603) 40,968,485
------------
Collateralized Mortgage Obligations--1.9%
Finance--1.9%
2,000,000 Commercial Mortgage Asset Trust, Series 1999-C1,
Class C, 7.35%, 8/17/2013 1,878,880
2,000,000 Criimi Mae CMBS Corp., Series 1998-1, Class A2,
6.01%, 2/20/2005 1,847,030
2,825,000 Deutsche Mortgage and Asset Receiving Corp., Series 1998-C1, Class
D, 7.23%, 6/15/2031 2,455,321
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
Collateralized Mortgage Obligations--continued
Finance--continued
$33,712,723 Deutsche Mortgage and Asset Receiving Corp., Series
1998-C1, Class X, 1.254%, 2/15/2023 $ 1,706,707
2,000,000 Nomura Asset Securities Corp., Series 1998-D6,
Class A3, 6.98%, 3/17/2028 1,846,040
31,818,483 Nomura Asset Securities Corp., Series 1998-D6,
Class ACS1, 1.65%, 3/17/2028 782,098
------------
Total Collateralized Mortgage Obligations
(identified cost $15,534,930) 10,516,076
------------
Corporate Bonds--26.1%
Banking & Finance--2.4%
1,340,000 BB&T Corp., Sub. Note, 7.25%, 6/15/2007 1,299,733
3,559,087 Chase Manhattan Bank--First Union National, Series
1999-1, Class A1, 7.13%, 7/15/2007 3,547,556
500,000 First Colony Corp., Sr. Note, 6.625%, 8/1/2003 490,575
3,000,000 First National Bank of Commerce, Sr. Note, 6.50%,
1/14/2000 3,002,010
4,915,000 Landeskreditbank B-W, Sub. Note, 7.88%, 4/15/2004 5,070,806
------------
Total 13,410,680
------------
Basic Materials--0.9%
240,000 Armstrong World Industries, Inc., Deb., 9.75%,
4/15/2008 266,364
1,405,000 Du Pont (E.I.) de Nemours & Co., Note, 6.875%,
10/15/2009 1,383,293
500,000 Du Pont (E.I.) de Nemours & Co., Sr. Note, 6.75%,
9/1/2007 490,580
1,000,000 Du Pont (E.I.) de Nemours & Co., Unsecd. Note,
Series G, 6.47%, 9/26/2002 997,440
1,320,000 Nalco Chemical Co., Bond, 6.25%, 5/15/2008 1,167,104
750,000 Temple-Inland, Inc., Unsecd. Note, 7.25%, 9/15/2004 734,753
------------
Total 5,039,534
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Fixed Income Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- ------------------------------------------------------------------------------
<C> <S> <C>
Corporate Bonds--continued
Capital Goods--1.0%
$ 5,670,000 Ingersoll-Rand Co., Note, 6.13%, 11/18/2027 $ 5,595,099
------------
Communication Services--1.0%
5,100,000 AT&T Corp., Global Bond, 6.00%, 3/15/2009 4,682,361
1,200,000 Sprint Capital Corp., Company Guarantee, 6.88%,
11/15/2028 1,087,836
------------
Total 5,770,197
------------
Consumer Cyclicals--0.7%
500,000 General Motors Corp., Unsecd. Note, 7.10%,
3/15/2006 499,010
3,000,000 Tribune Co., Note, 6.25%, 11/10/2026 2,956,320
500,000 Wal-Mart Stores, Inc., Unsecd. Note, 6.75%,
5/15/2002 501,120
------------
Total 3,956,450
------------
Consumer Staples--0.6%
500,000 Anheuser-Busch Cos., Inc., Unsecd. Note, 6.90%,
10/1/2002 498,295
840,000 Archer-Daniels-Midland Co., Note, 6.625%, 5/1/2029 730,674
2,000,000 McDonald's Corp., Sr. Note, 6.00%, 6/23/2012 1,971,660
------------
Total 3,200,629
------------
Finance--14.4%
2,135,000 Abbey National Bank PLC, London, Sub., 6.69%,
10/17/2005 2,077,120
1,000,000 American Express Co., Discount Note, 12/12/2000 930,557
1,250,000 Bank of America Corp., Note, 6.625%, 6/15/2004 1,229,638
1,000,000 Bank of America Corp., Sub. Note, 6.625%, 8/1/2007 962,260
1,000,000 Bankers Trust Corp., Sr. Note, 6.75%, 10/3/2001 999,990
1,220,000 Bankers Trust Corp., Sub. Note, 7.25%, 10/15/2011 1,170,871
1,880,000 Bankers Trust Corp., Sub. Note, 7.375%, 5/1/2008 1,856,857
1,975,000 Bear Stearns Cos., Inc., Sr. Note, 6.70%, 8/1/2003 1,939,450
1,000,000 Beneficial Corp., Note, 6.20%, 12/4/2000 998,680
2,500,000 Commercial Credit Co., Unsecd. Note, 7.375%,
4/15/2005 2,494,450
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
Corporate Bonds--continued
Finance--continued
$ 185,000 Deutsche Bank Financial, Inc., Bank Guarantee,
7.50%, 4/25/2009 $ 184,193
5,000,000 Distribution Financial Services RV Trust, Series 1999-2, Class A4,
6.480%, 10/15/2013 4,946,250
755,000 First Union Corp., Sub. Note, 6.824%, 8/1/2026 753,724
800,000 General Motors Acceptance Corp., Note, 6.30%,
7/8/2002 789,712
3,000,000 Hanson Overseas B.V., Sr. Note, 7.375%, 1/15/2003 3,028,890
2,000,000 Hartford Life, Inc., Note, 7.10%, 6/15/2007 1,963,040
500,000 Heller Financial, Inc., Unsecd. Note, 5.625%,
3/15/2000 499,015
500,000 Household Finance Corp., 6.40%, 6/17/2008 469,600
3,750,000 IBM Credit Corp., Sr. Note, 5.79%, 3/20/2010
(Callable 3/20/2000 @100) 3,745,425
3,000,000 Ikon Capital Resources, Note, 6.94%, 5/21/2001 3,001,350
2,000,000 Inter-American Development Bank, Deb., 8.88%,
6/1/2009 2,274,900
2,145,000 International Lease Finance Corp., Note, 5.625%,
5/1/2002 2,087,964
7,165,000 Lehman Brothers Holdings, Inc., Bond, 7.00%,
5/15/2003 7,074,864
1,000,000 Lehman Brothers Holdings, Inc., Sr. Note, 8.75%,
3/15/2005 1,053,060
1,375,000 Mercantile Bancorporation, Inc., 6.80%, 6/15/2001 1,373,708
2,000,000 Merrill Lynch & Co., Inc., Bond, 6.00%, 7/15/2005 1,898,320
500,000 Merrill Lynch & Co., Inc., Sr. Note, 7.00%,
4/27/2008 491,655
2,000,000 Merrill Lynch & Co., Inc., Sr. Note, Series B,
6.80%, 4/26/2001 2,006,820
1,100,000 Metropolitan Life Insurance Co., 7.00%, 11/1/2005 1,075,591
2,090,000 Morgan Stanley Group, Inc., Note, 6.88%, 3/1/2007 2,054,407
4,000,000 Morgan Stanley, Dean Witter & Co., Sr. MTN, Series
C, 5.875%, 2/28/2001 3,958,240
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Fixed Income Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- ------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
Corporate Bonds--continued
Finance--continued
$ 1,500,000 Morgan Stanley, Dean Witter & Co., Unsecd.
Note, Series I, 7.07%, 2/10/2014 $ 1,447,890
2,250,000 National Rural Utilities Cooperative
Finance Corp., Collateral Trust, 5.75%,
11/1/2008 2,036,453
2,100,000 Salomon, Inc., Note, 6.38%, 10/1/2004 2,035,341
4,250,000 Smithkline Beecham Corp., Company
Guarantee, 6.75%, 9/5/2000 4,262,627
4,700,000 Union Planters Corp., Sub. Note, 6.50%,
3/15/2018 4,219,378
2,000,000 Wells Fargo & Co., Sr. Note, Series H,
6.75%, 6/15/2007 1,934,360
2,615,000 World Bank, Note, 5.00%, 11/28/2000 2,581,439
3,000,000 Xerox Capital Trust I, Company Guarantee,
8.00%, 2/1/2027 2,772,060
------------
Total 80,680,149
------------
Technology--1.8%
3,000,000 Electronic Data Systems Corp., Note,
7.125%, 10/15/2009 2,962,290
3,370,000 Motorola, Inc., Deb., 5.22%, 10/1/2097 2,170,819
5,000,000 Motorola, Inc., Sr. Deb., 6.50%, 9/1/2025 4,898,600
------------
Total 10,031,709
------------
Utilities--3.3%
500,000 Baltimore Gas & Electric Co., 1st Ref.
Mtg., 6.50%, 2/15/2003 495,575
1,000,000 General Electric Capital Corp., 6.81%,
11/3/2003 1,003,350
2,500,000 General Electric Capital Corp., Note,
8.85%, 4/1/2005 2,706,125
4,469,372 General Services Administration--Rosecliff
Realty, Note, 8.00%, 11/15/2008 4,648,316
5,000,000 National Fuel Gas Co., Note, 6.303%,
5/27/2008 4,649,050
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C> <C> <C>
Corporate Bonds--continued
Utilities--continued
$ 1,135,000 Ontario Hydro, Sr. Note, 6.10%, 1/30/2008 $ 1,066,900
250,000 Public Service Electric & Gas Co., 1st Ref.
Mtg., Series FF, 7.875%, 11/1/2001 254,005
3,000,000 SCANA Corp., Sr. Note, Series B, 6.25%,
7/8/2003 2,942,190
500,000 Union Electric Co., 1st Mtg. Bond, 6.875%,
8/1/2004 497,740
------------
Total 18,263,251
------------
Total Corporate Bonds (identified cost
$147,425,190) 145,947,698
------------
Foreign Bonds--1.9%
Finance--1.5%
1,000,000 Israel AID, 5.63%, 9/15/2003 963,800
1,590,000 Israel AID, 6.125%, 3/15/2003 1,562,286
5,000,000 Israel AID, 8.00%, 11/15/2001 5,129,550
1,005,000 Province of Manitoba, 9.00%, 12/15/2000 1,030,788
------------
Total 8,686,424
------------
Utilities--0.4%
500,000 GTE California, Inc. , Deb., Series A,
5.625%, 2/1/2001 494,890
1,820,000 GTE California, Inc. , Deb., Series G,
5.50%, 1/15/2009 1,613,776
------------
Total 2,108,666
------------
Total Foreign Bonds (identified cost
$10,764,592) 10,795,090
------------
Corporate Notes--1.3%
Finance--1.3%
5,000,000 BankUnited Financial Corp., Note, 5.40%,
2/2/2004 4,699,850
1,000,000 Caterpillar Financial Services Corp., MTN,
6.50%, 10/15/2002 991,750
1,750,000 Norwest Financial, Inc., Sr. Note, 6.625%,
7/15/2004 1,725,185
------------
Total Corporate Notes (identified cost
$7,692,103) 7,416,785
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Fixed Income Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- ------------------------------------------------------------------------
<C> <S> <C>
U.S. Government Agencies--39.0%
Federal Farm Credit Bank--0.3%
$ 1,700,000 5.730%, 7/28/2003 $ 1,654,576
------------
Federal Home Loan Bank--2.2%
1,000,000 6.520%, 4/2/2003 998,750
1,000,000 6.050%, 11/26/2001 994,840
4,300,000 5.765%, 6/11/2003 4,194,521
2,000,000 5.720%, 8/25/2003 1,945,320
1,500,000 5.625%, 6/2/2000 1,495,305
500,000 5.500%, 1/21/2003 485,235
2,000,000 5.485%, 3/23/2004 1,914,680
------------
Total 12,028,651
------------
Federal Home Loan Mortgage Corporation--2.1%
6,682 12.50%, 7/1/2011 7,367
2,438 12.50%, 3/1/2014 2,711
1,762 12.50%, 2/1/2010 1,932
8,355 11.00%, 10/1/2015 8,963
1,504 11.00%, 10/1/2010 1,614
13,828 9.50%, 7/1/2016 14,591
737 9.50%, 2/1/2019 781
403 9.50%, 2/1/2019 427
5,612 9.00%, 5/15/2016 5,938
821 9.00%, 1/1/2019 852
1,010 9.00%, 1/1/2019 1,049
811 8.50%, 8/1/2017 833
5,497 8.50%, 7/1/2017 5,646
6,348 8.25%, 10/1/2007 6,468
28,956 8.00%, 4/1/2009 29,327
795,592 8.00%, 2/1/2017 805,783
4,309 8.00%, 2/1/2009 4,355
8,296 8.00%, 12/1/2008 8,385
1,342 8.00%, 1/1/2019 1,359
472 8.00%, 1/1/2009 477
13,377 8.00%, 1/1/2008 13,548
500,000 7.75%, 11/7/2001 512,810
25,341 7.50%, 9/1/2007 25,674
95,997 7.50%, 2/1/2023 96,237
62,564 7.50%, 2/1/2023 62,720
187,073 7.50%, 2/1/2023 187,541
54,359 7.50%, 2/1/2023 54,495
72,423 7.50%, 2/1/2023 72,604
487,570 7.00%, 6/1/2008 487,277
693,471 7.00%, 2/1/2023 681,335
171,695 7.00%, 1/1/2023 168,690
1,653,286 6.50%, 8/1/2013 1,616,599
107,218 6.50%, 7/1/2008 105,656
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
U.S. Government Agencies--continued
Federal Home Loan Mortgage
Corporation--continued
$ 217,715 6.50%, 6/1/2008 $ 214,545
75,562 6.50%, 6/1/2008 74,461
11,193 6.50%, 6/1/2008 11,047
405,241 6.50%, 6/1/2008 399,937
427,023 6.50%, 5/1/2008 421,433
446,768 6.50%, 4/1/2009 440,263
1,198,571 6.50%, 11/1/2011 1,173,473
1,000,000 6.05%, 9/15/2022 975,930
304,961 6.00%, 10/1/2000 303,644
3,000,000 5.75%, 7/15/2003 2,926,410
------------
Total 11,935,187
------------
Federal National Mortgage Association--24.7%
179 12.50%, 9/1/2013 198
190 9.50%, 7/1/2016 202
1,342 9.50%, 7/1/2016 1,415
299 9.00%, 1/1/2017 313
149 8.50%, 2/1/2019 154
20,890 8.00%, 9/1/2009 21,283
1,188,632 8.00%, 7/1/2025 1,206,830
31,072 8.00%, 6/1/2022 31,616
2,240 8.00%, 11/1/2008 2,282
4,451 8.00%, 1/1/2009 4,535
182,126 7.50%, 6/1/2023 182,410
260,612 7.50%, 6/1/2023 261,018
703,973 7.50%, 5/1/2026 703,311
371,103 7.50%, 4/1/2007 374,814
414,354 7.50%, 12/1/2022 415,000
624,784 7.50%, 1/1/2023 625,952
184,913 7.50%, 1/1/2023 185,288
262,073 7.50%, 1/1/2023 262,482
89,362 7.50%, 1/1/2023 89,501
84,908 7.50%, 1/1/2023 85,080
3,554,808 7.10%, 12/1/2006 3,550,638
4,985,435 7.00%, 8/1/2029 4,871,667
2,272,411 7.00%, 11/1/2028 2,220,555
14,985,389 7.00%, 10/1/2029 14,643,422
4,394,220 6.94%, 4/1/2004 4,373,699
6,282,644 6.90%, 4/1/2006 6,217,654
2,112,232 6.50%, 9/1/2012 2,066,671
2,555,395 6.50%, 9/1/2012 2,500,275
865,498 6.50%, 8/1/2013 846,293
1,000,000 6.50%, 7/29/2002 991,250
1,689,244 6.50%, 7/1/2013 1,651,759
6,886,331 6.50%, 7/1/2013 6,733,523
</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 National Mortgage Association--continued
$ 2,844,350 6.50%, 3/1/2029 $ 2,712,799
29,594,680 6.50%, 2/1/2029 28,225,926
2,400,000 6.50%, 1/25/2014 2,321,232
2,317,793 6.50%, 1/1/2028 2,210,595
2,952,485 6.29%, 4/1/2008 2,805,467
1,000,000 6.29%, 1/22/2008 940,000
2,526,272 6.28%, 6/1/2009 2,385,089
2,765,396 6.26%, 6/1/2009 2,530,338
987,661 6.20%, 9/1/2008 931,398
2,508,606 6.10%, 8/1/2008 2,352,217
3,435,195 6.10%, 3/1/2008 3,229,223
3,520,940 6.00%, 8/1/2013 3,372,392
8,976,633 6.00%, 7/1/2013 8,597,909
2,664,707 6.00%, 7/1/2013 2,552,283
1,748,288 6.00%, 6/1/2013 1,674,528
3,000,000 6.00%, 5/15/2008 2,852,820
10,353,790 6.00%, 4/1/2013 9,936,325
1,256,472 6.00%, 4/1/2011 1,208,173
845,705 6.00%, 1/1/2009 819,124
900,000 5.44%, 1/29/2001 892,827
------------
Total 137,671,755
------------
Government National Mortgage Association--9.7%
8 12.25%, 5/15/2014 9
6,437 11.00%, 9/15/2015 7,096
107 11.00%, 11/15/2015 118
1,010 11.00%, 11/15/2015 1,115
841 10.50%, 8/15/2017 913
469 10.50%, 11/15/2000 472
181 10.50%, 11/15/2000 185
744 10.50%, 10/15/2000 750
22,082 9.50%, 9/15/2020 23,486
8,729 9.50%, 9/15/2017 9,288
2,632 9.50%, 7/15/2021 2,799
1,370 9.50%, 7/15/2018 1,457
4,491 9.50%, 7/15/2016 4,779
2,279 9.50%, 7/15/2016 2,425
9,501 9.50%, 6/15/2020 10,105
67,325 9.50%, 6/15/2020 71,604
20,145 9.50%, 6/15/2016 21,436
906 9.50%, 5/15/2016 965
1,062 9.50%, 5/15/2016 1,130
10,806 9.50%, 5/15/2016 11,498
11,005 9.50%, 4/15/2020 11,704
15,695 9.50%, 4/15/2020 16,693
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
U.S. Government Agencies--continued
Government National Mortgage
Association--continued
$ 15,209 9.50%, 12/15/2020 $ 16,176
98,323 9.50%, 12/15/2016 104,621
2,273 9.50%, 12/15/2016 2,419
14,014 9.50%, 11/15/2020 14,905
12,989 9.50%, 10/15/2020 13,814
6,323 9.50%, 10/15/2020 6,725
39,965 9.50%, 10/15/2020 42,505
8,773 9.50%, 10/15/2017 9,333
19,221 9.00%, 9/15/2022 20,206
161,720 9.00%, 9/15/2020 170,613
90,076 9.00%, 9/15/2019 95,142
18,342 9.00%, 9/15/2016 19,409
13,151 9.00%, 9/15/2016 13,916
1,025 9.00%, 9/15/2016 1,085
11,989 9.00%, 9/15/2016 12,656
8,235 9.00%, 9/15/2016 8,693
45,301 9.00%, 8/15/2021 47,736
5,707 9.00%, 8/15/2020 6,021
860 9.00%, 8/15/2016 910
71 9.00%, 8/15/2016 76
4,201 9.00%, 7/15/2022 4,416
68,426 9.00%, 7/15/2021 72,104
22,843 9.00%, 7/15/2021 24,070
58,032 9.00%, 7/15/2021 61,150
8,119 9.00%, 7/15/2018 8,581
235 9.00%, 7/15/2017 249
1,401 9.00%, 7/15/2016 1,482
7,628 9.00%, 7/15/2016 8,071
9,980 9.00%, 7/15/2016 10,535
9,985 9.00%, 6/15/2018 10,553
2,316 9.00%, 6/15/2017 2,449
6,323 9.00%, 6/15/2017 6,686
3,089 9.00%, 6/15/2016 3,261
11,996 9.00%, 6/15/2016 12,693
58,617 9.00%, 5/15/2022 61,621
8,275 9.00%, 5/15/2017 8,751
10,829 9.00%, 5/15/2016 11,431
5,340 9.00%, 5/15/2016 5,651
66,112 9.00%, 4/15/2022 69,501
1,939 9.00%, 4/15/2018 2,050
121,220 9.00%, 3/15/2020 127,886
156,087 9.00%, 3/15/2017 165,060
64,690 9.00%, 2/15/2021 68,166
12,467 9.00%, 2/15/2020 13,152
68,340 9.00%, 2/15/2017 72,269
15,821 9.00%, 12/15/2019 16,711
</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
$ 2,111 9.00%, 12/15/2016 $ 2,234
50,995 9.00%, 11/15/2020 53,799
7,896 9.00%, 11/15/2020 8,330
16,403 9.00%, 11/15/2020 17,305
10,182 9.00%, 11/15/2019 10,755
21,537 9.00%, 11/15/2016 22,789
21,497 9.00%, 11/15/2016 22,693
29,107 9.00%, 10/15/2020 30,707
21,135 9.00%, 10/15/2019 22,323
269 9.00%, 10/15/2016 284
17,084 9.00%, 10/15/2016 18,077
29,751 9.00%, 10/15/2016 31,406
15,688 9.00%, 10/15/2016 16,561
23,152 9.00%, 1/15/2021 24,396
48,066 9.00%, 1/15/2021 50,649
10,883 9.00%, 1/15/2021 11,468
23,924 9.00%, 1/15/2021 25,210
17,267 9.00%, 1/15/2021 18,195
18,363 9.00%, 1/15/2021 19,350
14,956 9.00%, 1/15/2020 15,778
43,665 9.00%, 1/15/2017 46,176
2,247 9.00%, 1/15/2017 2,376
16,559 9.00%, 1/15/2017 17,511
5,866 9.00%, 1/15/2017 6,186
133,983 9.00%, 1/15/2017 141,685
20,424 9.00%, 1/15/2017 21,598
269,928 8.50%, 9/15/2022 279,626
380,692 8.50%, 9/15/2022 394,370
653 8.50%, 9/15/2017 679
1,989 8.50%, 7/15/2016 2,069
16,745 8.50%, 6/15/2022 17,347
3,425 8.50%, 6/15/2017 3,560
54,626 8.50%, 6/15/2016 56,817
11,825 8.50%, 6/15/2016 12,300
7,515 8.50%, 6/15/2016 7,817
53,363 8.50%, 5/15/2022 55,280
19,412 8.50%, 5/15/2021 20,109
14,489 8.50%, 5/15/2016 15,070
3,060 8.50%, 4/15/2022 3,170
27,302 8.50%, 12/15/2021 28,283
203,613 8.50%, 11/15/2022 210,928
33,198 8.50%, 11/15/2021 34,391
12,695 8.50%, 11/15/2021 13,151
41,210 8.50%, 11/15/2021 42,691
88,695 8.00%, 9/15/2022 90,385
97,509 8.00%, 9/15/2022 99,367
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
U.S. Government Agencies--continued
Government National Mortgage
Association--continued
$ 193,129 8.00%, 9/15/2022 $ 196,810
687,649 8.00%, 6/15/2023 700,755
7,459 8.00%, 6/15/2017 7,637
8,036 8.00%, 6/15/2004 8,157
198,855 8.00%, 5/15/2022 202,645
71,588 8.00%, 4/15/2022 72,952
463,242 8.00%, 4/15/2017 474,239
6,691 8.00%, 2/15/2017 6,849
128,188 7.50%, 8/15/2022 128,387
49,988 7.50%, 3/15/2023 50,051
92,871 7.50%, 2/15/2023 92,987
90,181 7.50%, 2/15/2023 90,294
84,675 7.50%, 2/15/2022 84,807
74,278 7.50%, 2/15/2022 74,394
118,283 7.50%, 12/15/2022 118,467
47,740 7.50%, 12/15/2022 47,815
83,574 7.50%, 12/15/2022 83,705
85,473 7.50%, 12/15/2022 85,606
95,177 7.50%, 11/15/2022 95,325
109,349 7.50%, 10/15/2022 109,519
623,927 7.50%, 1/15/2024 624,507
4,991,227 7.00%, 9/15/2029 4,874,233
571,702 7.00%, 6/15/2023 561,336
600,566 6.50%, 5/15/2011 589,240
939,891 6.50%, 5/15/2009 924,909
2,091,454 6.50%, 4/15/2024 2,004,533
3,475,341 6.50%, 3/15/2029 3,305,918
695,741 6.50%, 3/15/2024 666,826
3,434,975 6.50%, 11/20/2027 3,256,803
9,622,570 6.50%, 1/15/2029 9,153,470
978,801 6.00%, 5/15/2009 947,293
5,951,505 6.00%, 3/15/2029 5,497,702
3,659,109 6.00%, 2/15/2029 3,380,102
3,119,526 6.00%, 2/15/2029 2,881,662
3,009,508 6.00%, 2/15/2029 2,777,143
6,825,691 6.00%, 1/15/2029 6,305,231
------------
Total 54,183,097
------------
Total U.S. Government Agencies (identified
cost $224,965,219) 217,473,266
------------
U.S. Treasury Obligations--12.7%
United States Treasury Notes--0.8%
550,000 (2)5.75%, 8/15/2003 543,296
4,000,000 (2)5.875%, 11/15/2005 3,935,000
------------
Total 4,478,296
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Fixed Income Fund
<TABLE>
<CAPTION>
Principal
Amount
or Shares Value
- ----------------------------------------------------------------------------
<C> <S> <C>
U.S. Treasury Obligations--continued
U.S. Treasury Bonds--11.9%
$13,195,000 6.375%, 8/15/2027 $ 12,966,199
40,100,000 6.75%, 8/15/2026 41,240,444
10,720,000 8.00%, 11/15/2021 12,451,923
------------
Total 66,658,566
------------
Total U.S. Treasury Obligations (identified cost
$74,632,993) 71,136,862
------------
Closed-End Investment Companies--7.3%
265,250 2002 Target Term Trust, Inc. 3,597,453
356,845 Blackrock 1999 Term Trust 3,613,056
780,100 Blackrock 2001 Term Trust, Inc. 6,923,388
28,400 Blackrock Advantage Term Trust 257,375
570,900 Blackrock Strategic Term Trust, Inc. 5,031,056
1,379,000 Blackrock Target Term Trust 13,186,688
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount
or Shares Value
<C> <S> <C>
Closed-Ended Investment Companies--continued
3,200 Nations Government Income Term Trust 2003 $ 28,600
652,500 RCM Strategic Global Government Fund 5,750,156
14,400 TCW/DW Term Trust 2002 134,100
58,400 TCW/DW Term Trust 2003 532,900
296,300 Templeton Global Income Fund 1,814,838
------------
Total Closed-End Investment Companies (identified
cost $40,990,930) 40,869,610
------------
(3) Repurchase Agreement--1.3%
$ 7,355,266 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999,
due 12/1/1999 (at amortized cost) 7,355,266
------------
Total Investments (identified cost $570,881,826) $552,479,138
------------
</TABLE>
(See Notes to Portfolios of Investments)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Intermediate Fixed Income Fund (Class A Shares)
Growth of $10,000 Invested in Wachovia Intermediate Fixed Income Fund (Class A
Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Intermediate Fixed Income Fund (Class A Shares) (the "Fund") from
January 29, 1993 (start of performance) to November 30, 1999 compared to the
Lehman Brothers Govt./Corp. Intermediate Index (LBGCII).+
[Please see Appendix A24]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund after deducting
the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge
= $9,550). The Fund's performance assumes the reinvestment of all dividends
and distributions. The LBGCII has been adjusted to reflect the reinvestment of
dividends on securities in the index.
**Total returns quoted reflect all applicable sales charges and contingent
deferred sales charges.
+ The LBGCII is an unmanaged index generally representative of the performance
of government and corporate bonds with maturities between 1 and 10 years. The
LBGCII is not adjusted to reflect sales charges, expenses, or other fees that
the SEC requires to be reflected in the Fund's performance. Investments cannot
be made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Intermediate Fixed Income Fund (Class Y Shares)
Growth of $10,000 Invested in Wachovia Intermediate Fixed Income Fund (Class Y
Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Intermediate Fixed Income Fund (Class Y Shares) (the "Fund") from March
29, 1998 (start of performance) to November 30, 1999 compared to the Lehman
Brothers Govt./Corp. Intermediate Index (LBGCII).+
[Please see Appendix A25]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* The Fund's performance assumes the reinvestment of all dividends and
distributions. The LBGCII has been adjusted to reflect the reinvestment of
dividends on securities in the index.
+ The LBGCII is an unmanaged index generally representative of the performance
of government and corporate bonds with maturities between 1 and 10 years. The
LBGCII is not adjusted to reflect sales charges, expenses, or other fees that
the SEC requires to be reflected in the Fund's performance. Investments
cannot be made in an index.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Intermediate Fixed Income Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Principal
Amount Value
- -----------------------------------------------------------------------------
<C> <S> <C>
Asset-Backed Securities--6.7%
Finance--6.7%
$2,000,000 AT&T Universal Card Master Trust 1995-2, Class A,
5.950%, 10/17/2002 $ 1,993,120
2,000,000 Chase Credit Card Owner Trust 1999-3, Class A,
6.660%, 10/15/2004 1,981,780
760,000 DLJ Commercial Mortgage Corp. 1999-CG1, Class A1B,
6.460%, 1/10/2009 721,065
1,135,000 Discover Card Master Trust I 1998-7, Class A,
5.600%, 5/16/2006 1,086,047
1,475,000 Distribution Financial Services RV Trust 1999-1,
Class A5, 5.970%, 8/15/2013 1,446,813
100,000 MBNA Master Credit Card Trust II 1995-D, Class A,
6.050%, 11/15/2002 99,906
2,140,000 Premier Auto Trust 1998-1, Class A4, 5.700%,
10/6/2002 2,119,263
------------
Total Asset-Backed Securities (identified cost
$9,626,843) 9,447,994
------------
Collateralized Mortgage Obligations--1.3%
1,581,817 Chase Manhattan Bank N.A., New York, Class A1,
7.134%, 8/15/2031 1,576,692
9,190,459 Nomura Asset Securities Corp. 1998-D6, Class ACS1,
1.650%, 3/17/2028 225,902
------------
Total Collateralized Mortgage Obligations
(identified cost $1,815,349) 1,802,594
------------
Corporate Bonds--32.4%
Bank--0.9%
750,000 Citicorp, Sr. MTN, Series C, 6.650%, 5/15/2000 751,455
500,000 Dresdner Bank AG, Frankfurt, Sub. Note, 6.625%,
9/15/2005 481,665
------------
Total 1,233,120
------------
Basic Materials--1.2%
750,000 Du Pont (E.I.) de Nemours & Co., Unsecd. Note,
6.750%, 10/15/2002 752,828
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
Corporate Bonds--continued
Basic Materials--continued
$1,000,000 Monsanto Co., Note, 6.000%, 7/1/2000 $ 997,460
------------
Total 1,750,288
------------
Communication Services--0.6%
900,000 AT&T Corp., Global Bond, 6.000%, 3/15/2009 826,299
------------
Consumer Cyclicals--2.0%
750,000 Coca Cola Enterprises, Inc., 5.750%, 11/1/2008 677,355
1,000,000 Ford Motor Co., Note, 7.250%, 10/1/2008 998,200
1,300,000 Hasbro, Inc., 5.600%, 11/1/2005 1,188,382
------------
Total 2,863,937
------------
Consumer Non-Durables--0.7%
1,000,000 Philip Morris Cos., Inc., 7.650%, 7/1/2008 968,530
------------
Finance--8.7%
1,000,000 BankBoston, N.A., Sub. Note, 6.500%, 12/19/2007 944,730
1,000,000 CIGNA Corp., Note, 7.400%, 5/15/2007 988,140
2,350,000 Ford Motor Credit Corp., Unsecd. Note, 6.250%,
11/8/2000 2,343,162
750,000 General Electric Capital Corp., Note, 5.500%,
4/15/2002 730,523
1,000,000 General Electric Capital Corp., Sr. Note, Series
MTNA, 5.960%, 5/14/2001 992,130
1,000,000 General Electric Capital Corp., Sr. Note, Series
MTNA, 6.875%, 4/15/2000 1,002,930
1,000,000 J.P. Morgan & Co., Inc., Sub. Note, 6.000%,
1/15/2009 912,260
1,000,000 J.P. Morgan & Co., Inc., Sub. Note, 7.625%,
9/15/2004 1,021,940
500,000 McDonnell Douglas Finance Corp., Sr. Note, Series
MTN, 6.830%, 5/21/2001 501,480
1,000,000 Pitney Bowes Credit Corp., MTN, 6.780%, 7/16/2001 1,005,600
1,000,000 State Street Boston Corp., 5.950%, 9/15/2003 958,920
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Intermediate Fixed Income Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Corporate Bonds--continued
Finance--continued
$1,000,000 Union Planters Corp., Sub. Note, 6.500%, 3/15/2018 $ 897,740
------------
Total 12,299,555
------------
Financial Services--11.6%
2,000,000 CIT Group, Inc., Sr. Note, 5.800%, 3/26/2002 1,949,520
1,180,000 Chase Manhattan Corp., Sr. Note, 6.750%, 12/1/2004 1,169,026
2,000,000 Countrywide Home Loans, Inc., Company Guarantee,
6.050%, 3/1/2001 1,985,020
1,500,000 First Union Corp., Note, 6.625%, 6/15/2004 1,468,215
2,000,000 Fleet Credit Card LLC, Sub. Note, 7.000%, 8/1/2003 1,982,580
1,000,000 KFW International Finance, Company Guarantee,
8.250%, 11/30/2004 1,057,682
1,000,000 Lehman Brothers Holdings, Inc., Note, 6.890%,
10/10/2000 1,001,530
1,000,000 Lehman Brothers Holdings, Inc., Note, 7.375%,
5/15/2004 996,960
1,000,000 Merrill Lynch & Co., Inc., Bond, 6.000%, 7/15/2005 949,160
1,000,000 Merrill Lynch & Co., Inc., Note, 6.000%, 2/12/2003 974,920
1,000,000 Merrill Lynch & Co., Inc., Sr. MTN, Series B,
5.710%, 1/15/2002 979,280
1,000,000 Norwest Financial, Inc., Sr. Note, Series 2002,
7.875%, 2/15/2002 1,022,750
1,000,000 Salomon, Inc., Sr. Note, 7.300%, 5/15/2002 1,007,910
------------
Total 16,544,553
------------
Healthcare--0.7%
1,000,000 Bristol-Myers Squibb Co., Deb., 6.800%, 11/15/2026 940,920
------------
Recreation--2.3%
3,250,000 Disney (Walt) Co., Bond, Series B, 6.750%, 3/30/2006 3,198,715
------------
Retail--0.8%
265,000 Archer-Daniels-Midland Co., Note, 6.625%, 5/1/2029 230,510
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
Corporate Bonds--continued
Retail--continued
$1,000,000 Wal-Mart Stores, Inc., Note, 5.875%, 10/15/2005 $ 953,530
------------
Total 1,184,040
------------
Technology--0.3%
500,000 First Data Corp., Sr. MTN, Series D, 6.610%,
6/9/2000 500,855
------------
Transportation--1.4%
1,000,000 Burlington Northern, Inc., Equip. Trust, Series
96AA, 7.460%, 9/24/2011 985,742
1,000,000 CSX Corp., Deb., 7.050%, 5/1/2002 999,340
------------
Total 1,985,082
------------
Utilities--1.2%
730,000 National Rural Utilities Cooperative Finance Corp.,
Collateral Trust, 5.750%, 11/1/2008 660,716
1,000,000 SCANA Corp., MTN Note, Series B, 7.440%, 10/19/2004 1,018,910
------------
Total 1,679,626
------------
Total Corporate Bonds (identified cost $48,349,435) 45,975,520
------------
U.S. Government Agencies--32.8%
Federal Farm Credit--1.4%
2,080,000 5.750%, 9/1/2005 1,983,467
------------
Federal Home Loan
Bank System--5.2%
1,000,000 5.280%, 1/6/2004 952,340
2,000,000 6.250%, 8/13/2004 1,970,940
1,500,000 6.405%, 4/10/2001 1,503,750
1,890,000 7.010%, 4/19/2000 1,894,725
1,030,000 8.090%, 12/28/2004 1,096,785
------------
Total 7,418,540
------------
Federal Home Loan Mortgage Corporation--1.7%
2,524,298 7.000%, 7/1/2029 2,468,284
------------
Federal National Mortgage Association--19.9%
2,958,000 5.125%, 2/13/2004 2,801,788
2,000,000 5.460%, 11/3/2003 1,915,320
3,683,796 6.000%, 8/1/2013 3,528,377
1,000,000 6.240%, 9/7/2000 1,000,620
3,184,481 6.500%, 7/1/2013 3,113,818
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Intermediate Fixed Income Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- ---------------------------------------------------------------------------
<C> <S> <C>
U.S. Government Agencies--continued
Federal National Mortgage Association--continued
$3,585,697 6.500%, 8/1/2028 $ 3,419,859
7,089,112 6.500%, 2/1/2029 6,761,241
1,500,000 6.710%, 7/24/2001 1,508,430
1,467,136 6.740%, 1/1/2004 1,452,435
2,746,682 7.000%, 9/1/2027 2,687,436
------------
Total 28,189,324
------------
Government National Mortgage Association--4.2%
1,485,940 6.000%, 2/15/2029 1,372,637
1,266,819 6.000%, 2/15/2029 1,170,224
1,222,141 6.000%, 2/15/2029 1,127,780
2,416,867 6.000%, 3/15/2029 2,232,581
------------
Total 5,903,222
------------
Other--0.4%
600,000 Israel AID, Note, Series 3-C, 6.60%, 2/15/2008 592,932
------------
Total U.S. Government Agencies (identified cost
$46,779,143) 46,555,769
------------
U.S. Treasury Obligations--16.7%
United States Treasury
Bonds--4.1%
3,470,000 (2)6.125%, 11/15/2027 3,304,099
1,600,000 7.125%, 2/15/2023 1,706,000
675,000 7.250%, 5/15/2016 718,139
------------
Total 5,728,238
------------
United States Treasury
Notes--12.6%
1,000,000 5.250%, 5/15/2004 966,090
1,000,000 5.625%, 5/15/2008 956,720
474,000 5.750%, 10/31/2000 473,630
335,000 5.750%, 8/15/2003 330,916
455,000 5.875%, 11/30/2001 453,935
1,000,000 5.875%, 9/30/2002 995,160
2,000,000 6.250%, 2/15/2003 2,008,120
3,705,000 6.375%, 8/15/2002 3,733,936
680,000 6.500%, 5/31/2002 687,439
900,000 6.500%, 8/15/2005 911,529
1,500,000 6.875%, 5/15/2006 1,547,805
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount
or Shares Value
<C> <S> <C>
U.S. Treasury Obligations--continued
United States Treasury
Notes--continued
$4,150,000 7.000%, 7/15/2006 $ 4,310,813
500,000 7.750%, 2/15/2001 510,310
------------
Total 17,886,403
------------
Total U.S. Treasury Obligations (identified cost
$23,951,998) 23,614,641
------------
Closed-End Investment Companies--5.9%
26,155 2002 Target Term Trust, Inc. 354,727
98,427 Blackrock 1999 Term Trust, Inc. 996,573
235,965 Blackrock 2001 Term Trust, Inc. 2,094,189
146,167 Blackrock Strategic Term Trust, Inc. 1,288,097
104,905 Blackrock Target Term Trust, Inc. 1,003,154
50,000 TCW/DW Term Trust 2002 465,625
228,550 TCW/DW Term Trust 2003 2,085,519
------------
Total Closed-End Investment Companies (identified
cost $8,118,517) 8,287,884
------------
(3) Repurchase Agreement--2.9%
$4,155,232 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999,
due 12/1/1999 (at amortized cost) 4,155,232
------------
Total Investments (identified cost $142,796,517) $139,839,634
------------
</TABLE>
(See Notes to Portfolios of Investments)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Short-Term Fixed Income Fund (Class A Shares)
Growth of $10,000 Invested in Wachovia Short-Term Fixed Income Fund (Class A
Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Short-Term Fixed Income Fund (Class A Shares) (the "Fund") from May 7,
1993 (start of performance) to November 30, 1999 compared to the Merrill Lynch
1-3 Year U.S. Treasury Index.+
[Please see Appendix A26]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund after deducting
the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge
= $9,550) that was in effect prior to February 1, 1995. As of February 1,
1995, the Fund's maximum sales charge is 2.50%. The Fund's performance
assumes the reinvestment of all dividends and distributions. The Merrill
Lynch 1-3 Year U.S. Treasury Index has been adjusted to reflect the
reinvestment of dividends on securities in the index.
** Total returns quoted reflect all applicable sales charges and contingent
deferred sales charges.
+ The Merrill Lynch 1-3 Year U.S. Treasury Index is an unmanaged index tracking
short-term U.S. government securities with maturities between 1 and 2.99
years. The index is produced by Merrill Lynch & Co., Inc. The Merrill Lynch
1-3 Year U.S. Treasury Index is not adjusted to reflect sales charges,
expenses, or other fees that the SEC requires to be reflected in the Fund's
performance. Investments cannot be made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Short-Term Fixed Income Fund (Class Y Shares)
Growth of $10,000 Invested in Wachovia Short-Term Fixed Income Fund (Class Y
Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Short-Term Fixed Income Fund (Class Y Shares) (the "Fund") from July
23, 1996 (start of performance) to November 30, 1999 compared to the Merrill
Lynch 1-3 Year U.S. Treasury Index.+
[Please see Appendix A27]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* The Fund's performance assumes the reinvestment of all dividends and
distributions. The Merrill Lynch 1-3 Year U.S. Treasury Index has been
adjusted to reflect the reinvestment of dividends on securities in the
index.
+ The Merrill Lynch 1-3 Year U.S. Treasury Index is an unmanaged index tracking
short-term U.S. government securities with maturities between 1 and 2.99
years. The index is produced by Merrill Lynch & Co., Inc. The Merrill Lynch
1-3 Year U.S. Treasury Index is not adjusted to reflect sales charges,
expenses, or other fees that the SEC requires to be reflected in the Fund's
performance. Investments cannot be made in an index.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Short-Term Fixed Income Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Principal
Amount Value
- ------------------------------------------------------------------------------
<C> <S> <C>
Asset-Backed Securities--2.0%
$1,000,000 Distribution Financial Services RV Trust, Series
1999-2, Class A4, 6.48%, 10/15/2013 (identified cost
$999,781) $ 989,250
-----------
Collateralized Mortgage Obligations--2.0%
969,323 Federal National Mortgage Association, Series 1993- 137, Class B,
5.85%, 7/25/2000 (identified cost $966,143) 963,866
-----------
Corporate Bonds--35.7%
Banking & Finance--7.1%
1,000,000 Bank One, NA, 7.000%, 5/8/2000 1,001,570
2,500,000 NationsBank Corp., 5.750%, 3/15/2001 2,471,900
-----------
Total 3,473,470
-----------
Finance--14.3%
2,000,000 Bankers Trust Corp., MTN, 5.850%, 5/11/2000 1,996,980
2,000,000 General Motors Acceptance Corp., 6.850%, 6/17/2004 1,988,520
1,000,000 Household Finance Corp., MTN, 6.125%, 7/15/2002 977,930
2,000,000 Merrill Lynch & Co., Inc., 6.020%, 5/11/2001 1,982,020
-----------
Total 6,945,450
-----------
Health Services--5.1%
2,500,000 McKesson Corp., 6.600%, 3/1/2000 2,500,550
-----------
Technology--9.2%
1,500,000 Eastman Kodak Co., 6.500%, 8/15/2001 1,491,900
3,000,000 Xerox Corp., 5.750%, 7/21/2000 2,991,573
-----------
Total 4,483,473
-----------
Total Corporate Bonds (identified cost $17,523,395) 17,402,943
-----------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount or
Shares Value
<C> <S> <C>
U.S. Government Agencies--20.6%
Federal Home Loan Bank System--12.0%
$6,000,000 5.735%, 7/22/2003 $ 5,842,500
-----------
Federal National Mortgage Association--8.6%
4,390,031 6.000%, 9/1/2013 4,204,816
-----------
Total U.S. Government Agencies (identified cost
$10,346,202) 10,047,316
-----------
U.S. Treasury Obligations--25.4%
United States Treasury Notes--25.4%
1,000,000 5.500%, 12/31/2000 995,470
1,000,000 5.500%, 1/31/2003 983,280
2,000,000 5.625%, 12/31/2002 1,975,320
3,000,000 5.750%, 4/30/2003 2,967,660
2,000,000 5.750%, 8/15/2003 1,975,620
200,000 6.250%, 8/31/2000 200,624
750,000 6.250%, 10/31/2001 753,165
500,000 6.250%, 8/31/2002 502,420
1,000,000 6.375%, 3/31/2001 1,005,000
1,000,000 6.500%, 5/31/2001 1,007,500
-----------
Total U.S. Treasury Obligations (identified
cost $12,621,687) 12,366,059
-----------
Closed-End Investment Company--4.0%
192,301 Black Rock 1999 Term Trust (identified cost
$1,785,515) 1,947,048
-----------
(3) Repurchase Agreement--9.0% $4,397,275 Goldman Sachs Group, LP, 5.600%,
dated
11/30/1999, due 12/1/1999 (at amortized cost) 4,397,275
-----------
Total Investments (identified cost $48,639,998) $48,113,757
-----------
</TABLE>
(See Notes to Portfolios of Investments)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Georgia Municipal Bond Fund (Class A Shares)
Growth of $10,000 Invested in Wachovia Georgia Municipal Bond Fund (Class A
Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Georgia Municipal Bond Fund (Class A Shares) (the "Fund") from December
23, 1994 (start of performance) to November 30, 1999 compared to the Lehman
Brothers State General Obligation Bond Index (LBSGOBI) and the Lehman Brothers
Municipal Bond Index (LBMBI).+
[Please see Appendix A28]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund after deducting
the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge
= $9,550). The Fund's performance assumes the reinvestment of all dividends
and distributions. The LBSGOBI and the LBMBI has been adjusted to reflect the
reinvestment of dividends on securities in the index.
** Total returns quoted reflect all applicable sales charges and contingent
deferred sales charges.
+ The LBSGOBI is an unmanaged index comprised of all state general obligation
debt issues and is compiled without regard to maturities. These bonds are
rated A or better and represent a variety of coupon ranges. The LBMBI is an
unmanaged index generally representative of the performance of the municipal
bond market as a whole. The investment adviser has elected to change the
benchmark from LBSGOBI to LBMBI. The LBMBI is more representative of the
securities typically held by the Fund. The indices are not adjusted to
reflect sales charges, expenses, or other fees that the SEC requires to be
reflected in the Fund's performance. Investments cannot be made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Georgia Municipal Bond Fund (Class Y Shares)
Growth of $10,000 Invested in Wachovia Georgia Municipal Bond Fund (Class Y
Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Georgia Municipal Bond Fund (Class Y Shares) (the "Fund") from July 23,
1996 (start of performance) to November 30, 1999 compared to the Lehman Brothers
State General Obligation Bond Index (LBSGOBI) and the Lehman Brothers Municipal
Bond Index (LBMBI).+
[Please see Appendix A28]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* The Fund's performance assumes the reinvestment of all dividends and
distributions. The LBSGOBI and the LBMBI has been adjusted to reflect the
reinvestment of dividends on securities in the index.
+ The LBSGOBI is an unmanaged index comprised of all state general obligation
debt issues and is compiled without regard to maturities. These bonds are
rated A or better and represent a variety of coupon ranges. The LBMBI is an
unmanaged index generally representative of the performance of the municipal
bond market as a whole. The investment adviser has elected to change the
benchmark from LBSGOBI to LBMBI. The LBMBI is more representative of the
securities typically held by the Fund. The indices are not adjusted to
reflect sales charges, expenses, or other fees that the SEC requires to be
reflected in the Fund's performance. Investments cannot be made in an index.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Georgia Municipal Bond Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--97.0%
Georgia--96.8%
$1,530,000 Alpharetta, GA Development Authority,
University and College Improvement Revenue
Bonds, 4.80% (Original Issue Yield: 4.925%),
11/1/2018 AA $ 1,339,454
2,000,000 Atlanta, GA Downtown Development Authority,
Refunding Bonds, 6.00% (Original Issue
Yield: 6.10%), 10/1/2006 AA 2,096,380
100,000 Atlanta, GA Downtown Development Authority,
Refunding Revenue Bonds, 6.25% (Original
Issue Yield: 6.435%), 10/1/2016 AA 102,562
1,500,000 Atlanta, GA Downtown Development Authority,
Revenue Bonds, 6.75% (Trust Co. Bank
LOC)/(Original Issue Yield: 6.95%),
11/1/2014 Aa3 1,639,785
3,500,000 Atlanta, GA, GO UT (Series A), 6.125%
(Original Issue Yield: 6.18%), 12/1/2023 AA 3,786,160
510,000 Atlanta, GA, Urban Residential Finance
Authority, Dorm Facility Refunding Revenue
Bonds, 5.70% (Morehouse College)/(MBIA INS),
12/1/2010 AAA 528,039
80,000 Brunswick, GA, Water & Sewer Refunding
Revenue Bonds, 6.10% (MBIA INS)/(Original
Issue Yield: 6.27%), 10/1/2019 AAA 83,522
1,490,000 Burke County, GA Development Authority, PCR
Bonds, 7.50% (Oglethorpe Power Corp.)/(MBIA
INS), 1/1/2003 AAA 1,558,346
50,000 Chatham County, GA School District, GO UT,
6.75% (MBIA INS), 8/1/2018 AAA 54,620
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
Georgia--continued
$ 500,000 Cherokee County, GA Water & Sewer Authority, Refunding
Bonds, 6.90% (MBIA INS)/(Original
Issue Yield: 6.982%), 8/1/2018 AAA $ 528,220
1,400,000 Cherokee County, GA Water & Sewer Authority,
Revenue Bonds, 4.75% (Original Issue Yield:
4.99%), 8/1/2028 AAA 1,149,456
1,835,000 Cherokee County, GA Water & Sewer Authority,
Revenue Bonds, 5.20% (MBIA INS)/(Original
Issue Yield: 5.30%), 8/1/2025 AAA 1,683,282
1,790,000 Clayton County & Clayton County, GA Water
Authority, Refunding Revenue Bonds, 5.20%
(MBIA INS)/(Original Issue Yield: 5.30%),
5/1/2005 AAA 1,828,449
100,000 Cobb County, GA Solid Waste Management
Authority, Revenue Bonds, 6.35%, 1/1/2009 AAA 107,688
3,750,000 Cobb County, GA, GO UT, 5.375% (Original
Issue Yield: 5.50%), 1/1/2010 AAA 3,801,375
2,915,000 Cobb County, GA, Refunding Revenue Bonds
(Series A), 5.20% (Original Issue Yield:
5.25%), 7/1/2005 AA 2,979,305
1,000,000 Cobb County, GA, Refunding Revenue Bonds,
5.125% (Original Issue Yield: 5.55%),
7/1/2008 AA 1,010,530
2,000,000 Cobb-Marietta, GA Coliseum & Exhibit Hall
Authority, Refunding Revenue Bonds, 5.625%
(MBIA LOC)/(Original Issue Yield: 5.70%),
10/1/2026 AAA 1,945,860
500,000 Coweta County, GA Development Authority,
School Improvements, 3.70% (AMBAC)/(Original
Issue Yield: 3.85%), 12/1/1999 AAA 499,995
</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
$1,140,000 Coweta County, GA School System, GO UT
Refunding Bonds, 5.40% (Original Issue
Yield: 5.50%), 2/1/2003 AAA $ 1,170,427
1,000,000 Dalton, GA, Refunding Revenue Bonds, 5.00%
(MBIA INS), 1/1/2004 AAA 1,014,150
2,000,000 Dalton, GA, Revenue Bonds, 5.00%, 1/1/2004 AAA 2,027,560
150,000 De Kalb County, GA Development Authority, GO UT Bonds, 5.50%
(Original Issue Yield:
5.60%), 1/1/2016 AA+ 146,782
3,075,000 De Kalb County, GA Development Authority,
Refunding Bonds (Series A), 6.00% (Original
Issue Yield: 6.086%), 10/1/2014 AA 3,178,136
2,000,000 De Kalb County, GA School District, GO UT
Bonds (Series A), 6.25%, 7/1/2010 AA 2,192,260
200,000 De Kalb County, GA School District, GO UT
Bonds (Series A), 6.25%, 7/1/2011 AA 219,464
1,000,000 De Kalb County, GA School District, GO UT
Refunding Bonds, 5.60% (Original Issue
Yield: 5.70%), 7/1/2008 AA 1,032,080
3,055,000 De Kalb County, GA Water & Sewer, Refunding
Revenue Bonds, 5.25% (Original Issue Yield:
5.42%), 10/1/2023 AA 2,793,950
500,000 De Kalb County, GA, Refunding Revenue Bonds
(Series A), 5.375% (Emory University),
11/1/2005 AA 518,160
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 102,417
500,000 Downtown Savannah, GA, Refunding Revenue
Bonds (Series A), 4.95% (Original Issue
Yield: 5.05%), 1/1/2006 AA 502,095
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
Georgia--continued
$1,995,000 Fayette County, GA School District, GO UT
Bonds, 6.25%, 3/1/2005 A+ $ 2,132,974
160,000 Fayette County, GA, Water Revenue Bonds
(Series B), 6.20% (FGIC INS)/(Original Issue
Yield: 6.30%), 10/1/2022 AAA 170,528
60,000 Forsyth County, GA School District, GO UT
Bonds, 6.70%, 7/1/2012 AA- 67,458
1,000,000 Forsyth County, GA School District, GO UT
Bonds, 6.75%, 7/1/2016 AA- 1,117,010
1,000,000 Forsyth County, GA School District, GO,
Revenue Bond, 5.00%, 2/1/2004 AA- 1,014,390
1,880,000 Fulton County, GA Building Authority,
Refunding Bonds (Series A), 5.80% (Original
Issue Yield: 5.90%), 1/1/2005 AA 1,968,604
25,000 Fulton County, GA School District, GO UT
Bonds, 5.60% (Original Issue Yield: 5.65%),
1/1/2011 AA 26,302
5,250,000 Fulton County, GA Water & Sewage System,
Revenue Bonds, 4.75%, 1/1/2020 AA- 4,503,293
475,000 Fulton County, GA Water & Sewage System,
6.25% (FGIC INS)/(Original Issue Yield:
6.425%), 1/1/2007 AAA 512,240
1,000,000 Fulton County, GA Water & Sewage System,
Refunding Revenue Bonds, 5.25% (FGIC
LOC)/(Original Issue Yield: 4.974%),
1/1/2014 AAA 973,270
300,000 Fulton County, GA Water & Sewage System,
Revenue Refunding Bonds, 5.625% (FGIC
INS)/(Original Issue Yield: 5.75%), 1/1/2001 AAA 304,560
2,000,000 Fulton De Kalb, GA Hospital Authority,
Revenue Bonds, 5.50% (MBIA INS)/(Original
Issue Yield: 5.85%), 1/1/2012 AAA 2,010,860
</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 $ 307,755
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 295,668
500,000 Georgia Municipal Electric Authority,
Refunding Bonds (Series B), 6.375% (Original
Issue Yield: 6.45%), 1/1/2016 A 509,725
1,000,000 Georgia Municipal Electric Authority,
Refunding Bonds (Series EE), 6.00% (AMBAC
INS)/(Original Issue Yield: 6.47%), 1/1/2020 AAA 1,001,700
505,000 Georgia State HFA, Refunding Revenue Bonds
(Series A), 7.50% (FHA/VA mtgs GTD),
6/1/2017 AA+ 519,155
500,000 Georgia State HFA, Refunding Revenue SFM Bonds (Subseries A-2),
6.55% (FHA/VA mtgs
GTD), 12/1/2027 AAA 507,965
500,000 Georgia State Municipal Gas Authority,
Revenue Bonds, 6.00%, 7/1/2004 A- 524,935
1,000,000 Georgia State Municipal Gas Authority,
Revenue Bonds, 6.30% (Original Issue Yield:
6.40%), 7/1/2009 A- 1,018,510
2,000,000 Georgia State, GO UT (Series D), 6.80%,
8/1/2005 AAA 2,212,080
1,000,000 Georgia State, GO UT Bonds (Series A), 6.00%
(Original Issue Yield: 6.40%), 2/1/2007 AAA 1,038,060
1,300,000 Georgia State, GO UT Bonds (Series A),
6.25%, 4/1/2008 AAA 1,418,352
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
Georgia--continued
$1,000,000 Georgia State, GO UT Bonds (Series B),
5.95%, 3/1/2004 AAA $ 1,054,490
200,000 Georgia State, GO UT Bonds (Series B),
7.20%, 3/1/2006 AAA 225,954
765,000 Georgia State, GO UT Bonds (Series C),
7.25%, 7/1/2004 AAA 848,852
500,000 Georgia State, GO UT Bonds (Series D),
6.80%, 8/1/2000 AAA 509,520
200,000 Georgia State, GO UT Bonds (Series F),
6.50%, 12/1/2007 AAA 221,742
1,430,000 Georgia State, GO UT Bonds (Series A),
6.25%, 4/1/2007 AAA 1,553,609
500,000 Georgia State, GO UT Bonds (Series C), 6.50%
(Original Issue Yield: 6.63%), 4/1/2006 AAA 547,495
1,895,000 Gwinnett County, GA Housing Authority,
Refunding Revenue Bonds (Series A), 5.50%
(FNMA COL), 4/1/2026 AAA 1,915,030
1,100,000 Gwinnett County, GA, Water & Sewage Utility
Certificates of Participation, 8.40%,
8/1/2001 AAA 1,173,469
1,000,000 Hall County, GA School District, GO UT
Refunding Bonds, 4.50% (Original Issue
Yield: 5.20%), 11/1/2014 Aa3 869,970
1,000,000 Hart County, GA School District, GO UT,
4.25%, 4/1/2001 Aa2 1,000,020
3,600,000 Henry County, GA Water & Sewer Authority,
Revenue Bond, 5.00% (AMBAC INS)/(Original
Issue Yield: 5.32%), 2/1/2026 AAA 3,125,304
1,000,000 Henry County, GA School District, GO UT
Bonds (Series A), 6.45%, 8/1/2011 A+ 1,095,750
1,000,000 Henry County, GA School District, GO UT
Bonds, 5.625% (MBIA INS), 8/1/2007 AAA 1,039,880
1,000,000 Macon-Bibb County, GA Hospital Authority,
Refunding Revenue Bond (Series A), 5.30%
(FGIC INS), 8/1/2011 AAA 1,013,400
</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 Macon-Bibb County, GA Hospital Authority,
Refunding Revenue Bond (Series C), 5.25%
(FGIC INS), 8/1/2011 AAA $ 504,525
400,000 Marietta, GA Development Authority, Revenue Bonds (Series B), 5.75%
(Life College, Inc.)/(CGIC LOC)/(Original Issue Yield:
5.91%), 9/1/2014 AAA 404,320
3,425,000 Marietta, GA, GO UT (Series A) School
Improvement Bonds, 4.50% (Original Issue
Yield: 4.88%), 2/1/2019 AA- 2,842,476
500,000 Meriwether County, GA School District, GO UT
Bonds, 7.00% (FSA INS), 2/1/2007 AAA 561,025
4,000,000 Metropolitan Atlanta GA Rapid Transit
Authority, Refunding Revenue Bonds (Series
A), 6.90% (MBIA LOC), 7/1/2020 AAA 4,440,000
400,000 Newton County School District, GA, GO UT Bonds, 5.625% (FGIC
INS)/(Original Issue
Yield: 5.70%), 2/1/2013 AAA 405,980
1,000,000 Paulding County, GA School District, GO UT,
(Series A), 6.625% (Original Issue Yield:
6.75%), 2/1/2009 A 1,112,430
100,000 Peach County, GA School District, GO UT Bonds, 6.30% (MBIA
INS)/(Original Issue
Yield: 6.35%), 2/1/2014 AAA 108,809
2,000,000 Private Colleges & Universities Facilities
of GA, Refunding Revenue Bonds, 5.625%
(Agnes Scott College Project)/(Original
Issue Yield: 5.70%), 6/1/2023 AA 1,921,960
1,500,000 Private Colleges & Universities Facilities
of GA, Revenue Bonds, 5.00% (Agnes Scott
College Project)/(MBIA LOC)/(Original Issue
Yield: 5.06%), 6/1/2024 AAA 1,313,070
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
Georgia--continued
$2,800,000 Private Colleges & Universities Facilities
of GA, University and College Improvements,
4.75% (Agnes Scott College Project)/(MBIA
LOC)/ (Original Issue Yield: 5.079%),
6/1/2028 AAA $ 2,300,228
1,500,000 Rockdale County, GA School District, GO UT
Bonds, 6.30%, 1/1/2007 A1 1,611,990
1,000,000 Rockdale County, GA School District, GO UT,
6.20%, 1/1/2006 A1 1,071,290
3,000,000 Rockdale County, GA Water & Sewer, (Series
A), 5.375% (MBIA LOC), 7/1/2029 AAA 2,755,230
150,000 Savannah, GA Resources Recovery Development
Authority, Refunding Revenue Bonds, 5.95%
(Savannah Energy Systems Co.), 12/1/2002 A+ 155,450
2,335,000 Savannah, GA Resources Recovery Development
Authority, Revenue Bonds, 6.30% (Savannah
Energy Systems Co. Project), 12/1/2006 A+ 2,424,617
110,000 Savannah, GA Water & Sewage, Revenue Bonds,
5.10% (Original Issue Yield: 5.55%),
12/1/2010 AA- 109,205
5,000,000 Upper Oconee Basin, GA Water Authority,
Revenue Bonds, 5.25% (FGIC LOC)/(Original
Issue Yield: 5.41%), 7/1/2027 AAA 4,512,600
------------
Total 110,525,593
------------
Puerto Rico--0.2%
35,000 Puerto Rico Commonwealth Infrastructure Financing Authority, Revenue
Bonds (Series A), 5.00% (AMBAC LOC)/(Original Issue Yield:
5.28%), 7/1/2028 AAA 30,751
30,000 Puerto Rico Electric Power Authority,
Revenue Bonds (Series DD), 5.00% (MBIA
INS)/(Original Issue Yield: 5.28%), 7/1/2028 AAA 26,358
</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
Puerto Rico--continued
$ 265,000 Puerto Rico Highway and Transportation Authority, Refunding
Revenue Bonds (Series A), 5.00% (AMBAC LOC)/(Original Issue Yield:
5.16%), 7/1/2028 AAA $ 232,826
------------
Total 289,935
------------
Total Long-Term Municipals (identified cost
$112,241,382) 110,815,528
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C> <C>
Open-End Investment Companies--1.4%
17,221 AIM Global Management S\T Investments $ 17,221
617 Dreyfus Tax Exempt Money Market Fund 617
152,086 Federated Tax-Free Obligations Fund 152,086
1,440,557 Fidelity Tax Exempt Money Market Fund 1,440,557
------------
Total Open-End Investment Companies (at cost) 1,610,481
------------
Total Investments (identified cost $113,851,863) $112,426,009
------------
</TABLE>
(See Notes to Portfolios of Investments)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia North Carolina Municipal Bond Fund (Class A Shares)
Growth of $10,000 Invested in Wachovia North Carolina Municipal Bond Fund
(Class A Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia North Carolina Municipal Bond Fund (Class A Shares) (the "Fund") from
December 23, 1994 (start of performance) to November 30, 1999 compared to the
Lehman Brothers State General Obligation Bond Index (LBSGOBI) and the Lehman
Brothers Municipal Bond Index (LBMBI).+
[Please see Appendix A30]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund after deducting
the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge
= $9,550). The Fund's performance assumes the reinvestment of all dividends
and distributions. The LBSGOBI and the LBMBI has been adjusted to reflect the
reinvestment of dividends on securities in the index.
** Total returns quoted reflect all applicable sales charges and contingent
deferred sales charges.
+ The LBSGOBI is an unmanaged index comprised of all state general obligation
debt issues and is compiled without regard to maturities. These bonds are
rated A or better and represent a variety of coupon ranges. The LBMBI is an
unmanaged index generally representative of the performance of the municipal
bond market as a whole. The investment adviser has elected to change the
benchmark from LBSGOBI to LBMBI. The LBMBI is more representative of the
securities typically held by the Fund. The indices are not adjusted to
reflect sales charges, expenses, or other fees that the SEC requires to be
reflected in the Fund's performance. Investments cannot be made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia North Carolina Municipal Bond Fund (Class Y Shares)
Growth of $10,000 Invested in Wachovia North Carolina Municipal Bond Fund
(Class Y Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia North Carolina Municipal Bond Fund (Class Y Shares) (the "Fund") from
July 23, 1996 (start of performance) to November 30, 1999 compared to the Lehman
Brothers State General Obligation Bond Index (LBSGOBI) and the Lehman Brothers
Municipal Bond Index (LBMBI).+
[Please see Appendix A31]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* The Fund's performance assumes the reinvestment of all dividends and
distributions. The LBSGOBI and the LBMBI has been adjusted to reflect the
reinvestment of dividends on securities in the index.
+ The LBSGOBI is an unmanaged index comprised of all state general obligation
debt issues and is compiled without regard to maturities. These bonds are
rated A or better and represent a variety of coupon ranges. The LBMBI is an
unmanaged index generally representative of the performance of the municipal
bond market as a whole. The investment adviser has elected to change the
benchmark from LBSGOBI to LBMBI. The LBMBI is more representative of the
securities typically held by the Fund. The indices are not adjusted to
reflect sales charges, expenses, or other fees that the SEC requires to be
reflected in the Fund's performance. Investments cannot be made in an index.
- --------------------------------------------------------------------------------
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Wachovia North Carolina Municipal Bond Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--96.8%
North Carolina--95.3%
$8,650,000 Appalachian State University, NC,
Electricity, Light, Power, University and
College Improvement Revenue Bonds, 6.20%
(MBIA LOC)/(Original Issue Yield: 6.27%),
5/15/2024 AAA $ 9,348,660
1,030,000 Buncombe County, NC, GO UT Bonds, 4.90%
(Original Issue Yield: 5.15%), 4/1/2014 AA 964,420
1,400,000 Carteret County, NC, GO UT Bonds, 5.40%
(MBIA INS)/ (Original Issue Yield: 5.60%),
5/1/2015 AAA 1,373,386
1,150,000 Carteret County, NC, GO UT School
Improvements, 5.40% (MBIA LOC)/(Original
Issue Yield: 5.50%), 5/1/2012 AAA 1,164,386
1,300,000 Carteret County, NC, GO UT School
Improvements, 5.40% (MBIA LOC)/(Original
Issue Yield: 5.55%), 5/1/2013 AAA 1,304,498
1,305,000 Carteret County, NC, GO UT School
Improvements, 5.40% (MBIA LOC)/(Original
Issue Yield: 5.55%), 5/1/2014 AAA 1,296,544
1,000,000 Centennial Authority, NC, Revenue Bonds,
4.85% (FSA INS)/(Original Issue Yield:
4.95%), 9/1/2009 AAA 977,220
1,000,000 Charlotte, NC, (Series A) GO UT, 5.50%,
7/1/2005 AAA 1,034,630
1,960,000 Charlotte, NC, GO UT Bonds, 5.70%, 2/1/2007 AAA 2,066,291
2,000,000 Charlotte, NC, GO UT Refunding Bonds (Series
A), 5.50%, 7/1/2004 AAA 2,065,320
1,500,000 Charlotte, NC, GO UT Refunding Bonds, 5.00%
(Original Issue Yield: 3.95%), 2/1/2001 AAA 1,515,150
1,250,000 Charlotte, NC, GO UT Refunding Bonds, 5.00%
(Original Issue Yield: 5.10%), 2/1/2009 AAA 1,253,100
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
North Carolina--continued
$ 840,000 Charlotte, NC, GO UT Refunding Bonds, 5.00%
(Original Issue Yield: 5.15%), 2/1/2012 AAA $ 824,561
3,000,000 Charlotte, NC, GO UT Refunding Bonds, 5.40%,
6/1/2012 AAA 3,048,840
2,205,000 Charlotte, NC, GO UT Refunding Bonds, 5.50%
(Original Issue Yield: 5.55%), 7/1/2004 AAA 2,277,015
900,000 Charlotte, NC, GO UT Water & Sewer Bonds
(Series A), 5.30%, 4/1/2008 AAA 925,263
3,110,000 Charlotte, NC, GO UT Water & Sewer Bonds,
4.75%, 2/1/2001 AAA 3,132,610
9,200,000 Charlotte, NC, GO UT Water & Sewer Bonds,
5.60%, 5/1/2018 AAA 9,745,652
1,000,000 Charlotte, NC, GO UT, 5.00% (Original Issue
Yield: 4.45%), 6/1/2003 AAA 1,019,770
1,000,000 Charlotte, NC, GO UT, 5.00% (Original Issue
Yield: 5.10%), 2/1/2020 AAA 902,770
1,755,000 Charlotte, NC, GO UT, 5.00% (Original Issue
Yield: 5.15%), 6/1/2024 AAA 1,554,790
3,675,000 Charlotte, NC, GO UT, 5.25% (Original Issue
Yield: 4.35%), 2/1/2006 AAA 3,778,929
1,120,000 Charlotte, NC, GO UT, 5.50%, 5/1/2005 AAA 1,163,198
5,050,000 Charlotte, NC, GO UT, 5.80%, 2/1/2014 AAA 5,363,706
1,000,000 Charlotte, NC, GO UT, 5.90%, 2/1/2018 AAA 1,065,870
3,500,000 Charlotte, NC, Public Improvements, 5.375%
(Original Issue Yield: 5.50%), 6/1/2013 AA 3,460,310
</TABLE>
(See Notes to Portfolios of Investments)
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- --------------------------------------------------------------------------------
Wachovia North Carolina Municipal Bond Fund
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
North Carolina--continued
$2,000,000 Charlotte, NC, Refunding Bonds, 5.25% (AMBAC
LOC)/(Original Issue Yield: 5.70%),
12/1/2020 AAA $ 1,852,560
960,000 Charlotte-Mecklenburg Hospital Authority,
NC, Health System Refunding Revenue Bonds,
5.75% (Original Issue Yield: 6.498%),
1/1/2012 AA 969,149
1,140,000 Charlotte-Mecklenburg Hospital Authority,
NC, Refunding Bonds, 5.75% (Original Issue
Yield: 6.50%), 1/1/2012 AA 1,150,864
860,000 Charlotte-Mecklenburg Hospital Authority,
NC, PRF, 5.75% (Original Issue Yield:
6.50%), 1/1/2012 AA 899,010
1,190,000 Charlotte-Mecklenburg Hospital Authority,
NC, Refunding Bonds, 6.00% (Original Issue
Yield: 6.25%), 1/1/2005 AA 1,237,231
3,950,000 Charlotte-Mecklenburg Hospital Authority,
NC, Refunding Revenue Bonds, 5.00% (Original
Issue Yield: 5.05%), 1/15/2012 AA 3,764,903
1,500,000 Charlotte-Mecklenburg Hospital Authority,
NC, Refunding Revenue Bonds, 5.00% (Original
Issue Yield: 5.30%), 1/15/2017 AA 1,338,525
735,000 Charlotte-Mecklenburg Hospital Authority,
NC, Refunding Revenue Bonds, 6.00% (Original
Issue Yield: 6.25%), 1/1/2005 AA 771,963
1,000,000 Charlotte-Mecklenburg Hospital Authority,
NC, Revenue Bonds, 5.60% (Original Issue
Yield: 5.70%), 1/15/2009 AA 1,023,170
2,250,000 Concord, NC, (Series A) Multiple Utility
Improvement Revenue Bonds, 5.00% (MBIA INS),
12/1/2022 AAA 1,985,535
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
North Carolina--continued
$ 345,000 Concord, NC, Certificate of Participation, 5.60% (MBIA
INS)/(Original Issue Yield:
5.70%), 6/1/2005 AAA $ 356,609
445,000 Concord, NC, Certificate of Participation,
5.40% (MBIA INS)/(Original Issue Yield:
5.50%), 6/1/2003 AAA 455,747
2,600,000 Concord, NC, Revenue Bonds (Series A), 5.00%
(MBIA INS), 12/1/2017 AAA 2,362,724
2,250,000 Cumberland County, NC Civic Center Project,
(Series A), 6.40% (AMBAC INS)/(Original
Issue Yield: 6.62%), 12/1/2024 AAA 2,466,585
2,000,000 Cumberland County, NC Hospital Facilities,
Refunding Revenue Bonds, 4.00%, 10/1/2002 A- 1,950,960
1,000,000 Cumberland County, NC Hospital Facilities,
Refunding Revenue Bonds, 4.20% (Original
Issue Yield: 4.25%), 10/1/2004 A- 958,530
210,000 Cumberland County, NC Hospital Facilities,
Revenue Bonds, 6.00% (MBIA INS)/(Original
Issue Yield: 6.84%), 10/1/2021 AAA 216,430
2,000,000 Cumberland County, NC Hospital Facilities,
Refunding Revenue Bonds, 4.10%, 10/1/2003 A- 1,933,360
1,000,000 Cumberland County, NC, Certificate of
Participation (Series A), 6.375%, Civic
Center Project)/(AMBAC INS)/(Original Issue
Yield: 6.50%), 12/1/2010 AAA 1,095,160
615,000 Currituck County, NC, GO UT Bonds, 5.40%
(MBIA INS), 4/1/2009 AAA 632,896
100,000 Durham County, NC, GO UT Bonds, 5.75%
(Original Issue Yield: 5.95%), 2/1/2009 AAA 104,202
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
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Wachovia North Carolina Municipal Bond Fund
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--continued
North Carolina--continued
$2,820,000 Durham County, NC, GO UT Bonds, 5.75%
(Original Issue Yield: 5.95%), 2/1/2010 AAA $ 2,938,496
4,400,000 Durham County, NC, GO UT Public Improvement
Bonds, 5.90%, 4/1/2012 AAA 4,582,512
1,810,000 Durham County, NC, Refunding Bonds, 5.00%,
5/1/2004 AA 1,835,340
2,130,000 Durham County, NC, Refunding Bonds, 5.00%,
5/1/2005 AA 2,153,579
2,235,000 Durham County, NC, Refunding Bonds, 5.00%,
5/1/2006 AA 2,251,383
1,000,000 Durham County, NC, Refunding Bonds, 5.00%,
5/1/2007 AA 1,002,110
1,500,000 Durham County, NC, Refunding Bonds, 5.00%
(Original Issue Yield: 5.18%), 5/1/2014 AA 1,415,235
1,550,000 Durham, NC, GO UT Bonds, 5.20% (Original
Issue Yield: 5.30%), 2/1/2008 AAA 1,582,457
2,000,000 Durham, NC, GO UT Revenue Bonds, 5.80%
(Original Issue Yield: 5.95%), 2/1/2012 AAA 2,084,760
8,950,000 Fayetteville, NC Public Works Commission,
Refunding Revenue Bonds, 4.75% (FGIC
INS)/(Original Issue Yield: 5.23%), 3/1/2014 AAA 8,114,965
3,140,000 Forsyth County, NC, GO UT Bonds, 4.90%
(Original Issue Yield: 5.00%), 3/1/2007 AAA 3,155,951
2,510,000 Forsyth County, NC, GO UT Bonds, 5.40%
(Original Issue Yield: 5.65%), 6/1/2006 AAA 2,594,813
1,000,000 Forsyth County, NC, GO UT, 4.75%, 2/1/2005 AAA 1,006,090
160,000 Franklin County, NC, Certificates of Participation, 6.10% (Jail &
School Project)/(FGIC INS)/(Original Issue Yield:
6.20%), 6/1/2003 AAA 168,290
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
North Carolina--continued
$ 310,000 Fremont, NC Housing Development Corp., First
Lien Refunding Revenue Bonds, 6.75%
(Torhunta Apts)/(FNMA COL), 7/15/2022 NR $ 318,764
1,050,000 Gaston County, NC, GO UT Bonds, 5.20% (AMBAC
INS)/(Original Issue Yield: 5.35%), 3/1/2014 AAA 1,022,805
1,600,000 Gaston County, NC, GO UT Bonds, 5.20% (AMBAC
INS)/(Original Issue Yield: 5.40%), 3/1/2015 AAA 1,538,432
2,115,000 Gaston County, NC, GO UT Bonds, 5.20% (AMBAC
INS)/(Original Issue Yield: 5.40%), 3/1/2016 AAA 2,017,266
2,025,000 Gastonia, NC Combined Utilities System,
Refunding Revenue Bonds, 4.75% (Original
Issue Yield: 4.98%), 5/1/2015 AAA 1,805,368
2,000,000 Gastonia, NC Combined Utilities System,
Refunding Revenue Bonds, 6.10% (MBIA
INS)/(Original Issue Yield: 6.15%), 5/1/2019 AAA 2,152,620
100,000 Gastonia, NC Combined Utilities System,
Revenue Bonds, 6.00% (MBIA INS)/(Original
Issue Yield: 6.10%), 5/1/2014 AAA 107,235
500,000 Gastonia, NC, GO UT Bonds, 5.30% (FGIC
INS)/(Original Issue Yield: 5.40%), 6/1/2009 AAA 511,045
500,000 Gastonia, NC, GO UT, 5.40% (MBIA INS),
5/1/2011 AAA 510,190
3,485,000 Greensboro, NC, Certificate of Participation
(Series A), 5.625% (Original Issue Yield:
6.05%), 12/1/2015 AA 3,683,959
105,000 Greensboro, NC, Certificates of
Participation, 6.65% (Coliseum Arena
Expansion Project)/ (Original Issue Yield:
6.70%), 12/1/2004 AA 111,562
</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
$2,200,000 Greensboro, NC, GO UT Bonds, 4.70% (Original
Issue Yield: 4.80%), 4/1/2014 AAA $ 2,006,664
2,535,000 Greensboro, NC, GO UT Bonds, 4.70% (Original
Issue Yield: 4.90%), 4/1/2016 AAA 2,253,032
2,455,000 Greensboro, NC, GO UT Bonds, 4.75% (Original
Issue Yield: 4.95%), 4/1/2017 AAA 2,176,554
1,465,000 Greensboro, NC Enterprise System, Revenue
Bonds, 6.50%, 6/1/2006 AA- 1,601,421
1,000,000 Greensboro, NC Enterprise System, Water &
Sewer Improvements (Series A), 5.30% (MBIA
INS)/(Original Issue Yield: 5.518%),
6/1/2015 AAA 964,070
2,500,000 Greensboro, NC Enterprise System, Water &
Sewer Improvements (Series A), 5.375%
(Original Issue Yield: 5.594%), 6/1/2019 AA- 2,361,550
1,000,000 Guilford County, NC, GO UT, 6.10%, 2/1/2000 AA+ 1,003,680
1,400,000 Guilford County, NC, GO UT, 6.10%, 2/1/2001 AA+ 1,431,304
1,735,000 Harnett County, NC, Certificates of
Participation, 5.90% (AMBAC INS), 12/1/2000 AAA 1,768,173
500,000 Harnett County, NC, Certificates of
Participation, 6.20% (AMBAC INS), 12/1/2009 AAA 532,405
600,000 High Point, NC, GO UT Revenue Bonds, 5.60%,
3/1/2008 AA 625,746
1,980,000 Iredell County, NC Iredell Memorial
Hospital, 5.125% (AMBAC INS)/(Original Issue
Yield: 5.30%), 10/1/2013 AAA 1,907,651
5,000,000 Iredell County, NC, Certificates of
Participation, 6.125% (FGIC INS)/(Original
Issue Yield: 6.23%), 6/1/2007 AAA 5,267,550
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
North Carolina--continued
$1,130,000 Lee County, NC, GO UT, 5.00% (MBIA
INS)/(Original Issue Yield: 5.05%), 4/1/2009 AAA $ 1,129,503
1,725,000 Lee County, NC, GO UT, 5.00% (MBIA
INS)/(Original Issue Yield: 5.15%), 4/1/2010 AAA 1,714,581
2,700,000 Lee County, NC, GO UT, 5.00% (MBIA
INS)/(Original Issue Yield: 5.20%), 4/1/2011 AAA 2,664,225
100,000 Martin County, NC IFA, PCR Bonds, 6.80%
(Weyerhaeuser Co.), 5/1/2024 A 103,398
1,925,000 Mecklenburg County, NC, GO UT (Series B),
4.40% (Original Issue Yield: 4.60%),
2/1/2013 AAA 1,717,466
2,000,000 Mecklenburg County, NC, GO UT Bonds (Series
A), 4.40% (Original Issue Yield: 4.65%),
2/1/2014 AAA 1,754,560
8,435,000 Mecklenburg County, NC, GO UT Bonds (Series
B), 4.90% (Original Issue Yield: 5.10%),
3/1/2011 AAA 8,252,382
3,500,000 Mecklenburg County, NC, GO UT Bonds, 4.10%
(Original Issue Yield: 4.25%), 4/1/2003 AAA 3,462,130
4,405,000 Mecklenburg County, NC, GO UT Bonds, 4.80%
(Original Issue Yield: 4.90%), 3/1/2009 AAA 4,330,115
4,000,000 Mecklenburg County, NC, GO UT Bonds, 5.00%,
4/1/2008 AAA 4,030,920
10,000,000 Mecklenburg County, NC, GO UT Bonds, 5.40%,
4/1/2007 AAA 10,307,400
3,670,000 Mecklenburg County, NC, GO UT, 4.40%
(Original Issue Yield: 4.45%), 2/1/2011 AAA 3,379,703
13,000,000 Mecklenburg County, NC, GO UT, 4.40%,
2/1/2010 AAA 12,157,470
1,000,000 Moore County, NC, GO UT Bonds, 4.60% (MBIA
INS)/(Original Issue Yield: 4.65%), 6/1/2011 AAA 940,370
</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
$1,675,000 Moore County, NC, GO UT Public Improvements, 4.90% (MBIA
INS)/(Original Issue Yield:
4.95%), 6/1/2015 AAA $ 1,544,601
1,600,000 Moore County, NC, GO UT Public Improvement,
4.90% (MBIA INS)/(Original Issue Yield:
4.90%), 6/1/2014 AAA 1,497,472
3,225,000 New Hanover County, NC Hospital, Revenue
Bond, 4.75% (New Hanover Regal Medical)/
(Original Issue Yield: 5.23%), 10/1/2023 AAA 2,704,517
750,000 New Hanover County, NC PCR Financial
Authority, Revenue Bond, 6.90% (Carolina
Power & Light Co.), 4/1/2009 A 767,460
1,195,000 New Hanover County, NC, Certificate
Participation, 4.80% (Original Issue Yield:
4.90%), 12/1/2009 AAA 1,161,982
1,250,000 New Hanover County, NC, Certificate
Participation, 4.90% (MBIA LOC)/(Original
Issue Yield: 5.00%), 12/1/2010 AAA 1,215,925
1,315,000 New Hanover County, NC, Certificate
Participation, 5.00% (MBIA LOC)/(Original
Issue Yield: 5.05%), 12/1/2011 AAA 1,286,570
2,475,000 New Hanover County, NC, GO UT Bonds, 4.80%,
2/1/2017 AA- 2,193,914
2,475,000 New Hanover County, NC, GO UT Bonds, 4.90%,
2/1/2018 AA- 2,205,967
1,000,000 North Carolina Eastern Municipal Power
Agency, (Series B), 7.00% (Original Issue
Yield: 6.25%), 1/1/2008 A 1,098,840
1,650,000 North Carolina Eastern Municipal Power
Agency, Refunding Revenue Bond (Series A), 5.75% (FSA LOC)/(Original
Issue Yield:
6.734%), 1/1/2019 AAA 1,611,637
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
North Carolina--continued
$ 100,000 North Carolina Educational Facilities
Finance Agency, Refunding Revenue Bonds,
6.00% (Davidson College)/ (Original Issue
Yield: 6.20%), 12/1/2012 AA $ 104,356
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+ 446,211
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+ 1,056,250
20,000 North Carolina HFA, Multi-family Refunding
Revenue Bonds (Series B), 6.90% (FHA INS),
7/1/2024 NR 20,968
85,000 North Carolina HFA, Revenue Bonds (Series
Z), 6.60%, 9/1/2026 AA 86,890
750,000 North Carolina HFA, Revenue Bonds, 6.20%,
3/1/2018 AA 757,140
2,275,000 North Carolina HFA, Single Family Revenue
Bonds, 6.45%, 9/1/2014 AA 2,339,382
1,000,000 North Carolina Medical Care Commission,
Refunding Revenue Bond, 5.00% (Original
Issue Yield: 5.03%), 10/1/2004 AA 1,000,570
4,000,000 North Carolina Medical Care Commission,
Refunding Revenue Bond, 5.40% (Original
Issue Yield: 5.75%), 2/15/2011 A+ 3,972,120
6,335,000 North Carolina Medical Care Commission,
Refunding Revenue Bond, 5.50% (Original
Issue Yield: 6.10%), 5/1/2015 AA 6,164,715
1,355,000 North Carolina Medical Care Commission,
Refunding Revenue Bonds, 4.625% (Rex
Healthcare)/(Original Issue Yield: 4.93%),
6/1/2011 AAA 1,239,215
</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
$2,000,000 North Carolina Medical Care Commission,
Refunding Revenue Bonds, 5.00% BANs,
6/1/2013 AAA $ 1,882,840
50,000 North Carolina Medical Care Commission,
Refunding Revenue Bonds, 6.125% (Rex
Hospital)/(Original Issue Yield: 6.219%),
6/1/2010 A+ 53,420
6,240,000 North Carolina Medical Care Commission,
Revenue Bond (Series C), 5.25% (Duke
University Hospital)/(Original Issue Yield:
5.72%), 6/1/2021 AA 5,696,309
8,000,000 North Carolina Medical Care Commission,
Revenue Bond, 5.25% (Original Issue Yield:
5.72%), 5/1/2026 AA 7,098,400
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 936,380
5,000,000 North Carolina Medical Care Commission,
Revenue Bonds, 4.75% (Firsthealth of the
Carolina's)/(Original Issue Yield: 5.14%),
10/1/2026 AA- 4,049,050
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 504,483
1,000,000 North Carolina Medical Care Commission,
Revenue Bonds, 7.00% (Duke University
Hospital)/(Original Issue Yield: 7.08%),
6/1/2021 NR 1,058,480
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 1,094,365
</TABLE>
<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 $ 1,525,030
850,000 North Carolina Medical Care Commission,
Refunding Revenue Bonds, 7.375%
(Presbyterian Hospital)/(United States
Treasury PRF)/(Original Issue Yield:
7.417%), 10/1/2000 (Callable @102) AAA 890,171
3,680,000 North Carolina Municipal Power Agency No. 1,
Refunding Revenue Bonds, 6.25% (Original
Issue Yield: 6.477%), 1/1/2017 BBB+ 3,917,176
3,500,000 North Carolina State, (Series A), 4.70%
(Original Issue Yield: 4.30%), 2/1/2003 AAA 3,534,160
2,225,000 North Carolina State, Capital Inprovement GO
UT Bonds (Series A), 4.70%, 2/1/2006 AAA 2,221,685
5,000,000 North Carolina State, GO (Series A), 4.50%,
5/1/2006 AAA 4,924,550
3,000,000 North Carolina State, GO (Series B), 4.50%
(Original Issue Yield: 4.55%), 6/1/2005 AAA 2,980,530
2,140,000 North Carolina State, GO UT (Series A),
6.10%, 3/1/2001 AAA 2,190,996
1,675,000 North Carolina State, GO UT (Series A),
4.50%, 5/1/2005 AAA 1,664,213
5,000,000 North Carolina State, GO UT (Series A),
5.20% (Original Issue Yield: 5.45%),
3/1/2015 AAA 4,822,550
700,000 North Carolina State, GO UT (Series A),
6.00% (Original Issue Yield: 5.85%),
3/1/2000 AAA 703,675
7,260,000 North Carolina State, GO UT Bonds (Series
A), 4.70%, 2/1/2005 AAA 7,286,354
</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
$5,000,000 North Carolina State, GO UT Bonds (Series
A), 4.75%, 4/1/2006 AAA $ 5,009,200
5,000,000 North Carolina State, GO UT Bonds, 5.00%,
5/1/2011 AAA 4,950,500
1,000,000 North Carolina State, GO UT Bonds, 5.10%,
3/1/2003 AAA 1,021,690
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 983,000
2,850,000 North Carolina State, GO UT (Series A),
4.75% (Original Issue Yield: 5.00%),
2/1/2012 AAA 2,701,943
4,575,000 North Carolina State, GO UT, 4.60% (Original
Issue Yield: 3.72%), 4/1/2003 AAA 4,604,966
3,500,000 North Carolina State, GO UT, 4.60% (Original
Issue Yield: 3.82%), 4/1/2004 AAA 3,511,410
1,000,000 North Carolina State, GO UT, 5.10%, 3/1/2008 AAA 1,014,380
575,000 Onslow County, NC, GO UT Bonds, 5.70% (MBIA
INS)/(Original Issue Yield: 5.85%), 3/1/2013 AAA 592,905
2,500,000 Orange County, NC, GO UT Bonds, 5.50%
(Original Issue Yield: 5.75%), 2/1/2013 AA+ 2,524,325
1,000,000 Piedmont Triad Airport Authority, NC, Bonds
(Series A), 6.50% (MBIA INS)/ (Original
Issue Yield: 6.55%), 7/1/2000 AAA 1,014,790
4,845,000 Piedmont Triad Airport Authority, NC, Bonds,
5.00% (MBIA INS), 7/1/2008 AAA 4,846,114
1,250,000 Pitt County, NC, GO UT Bonds, 6.10%
(Original Issue Yield: 6.25%), 6/1/2009 AA- 1,322,413
3,000,000 Pitt County, NC, Refunding Bonds, 5.25%
(Pitt County Memorial Hospital)/(Original
Issue Yield: 5.85%), 12/1/2021 NR 2,780,580
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
North Carolina--continued
$3,000,000 Pitt County, NC, Refunding Bonds, 5.30%
(Pitt County Memorial Hospital)/(Original
Issue Yield: 5.40%), 12/1/2009 Aaa $ 3,055,800
2,380,000 Pitt County, NC, Refunding Revenue Bonds,
5.10% (Pitt County Memorial Hospital)/
(Original Issue Yield: 5.20%), 12/1/2007 NR 2,413,558
3,635,000 Pitt County, NC, Refunding Revenue Bonds,
5.20% (Pitt County Memorial Hospital)/
(Original Issue Yield: 5.30%), 12/1/2008 NR 3,698,031
350,000 Raleigh, NC, Certificate Participation
Refunding Bonds, 5.00% (Cabarrus Street
Parking Facilities Project)/(Original Issue
Yield: 5.10%), 12/1/2009 AA 343,658
230,000 Raleigh, NC, Certificate Participation
Refunding Bonds, 5.10% (Cabarrus Street
Parking Facilities Project)/(Original Issue
Yield: 5.20%), 12/1/2010 AA 226,033
400,000 Raleigh, NC, GO UT Refunding Bonds, 6.40%,
3/1/2006 AAA 418,336
2,945,000 Raleigh, NC, Refunding Bonds, 5.00%,
4/1/2005 AAA 2,997,892
2,905,000 Raleigh, NC, Revenue Bonds, 4.75% (Original
Issue Yield: 5.04%), 3/1/2024 AA+ 2,442,204
2,000,000 Raleigh, NC, Water Utility Improvement
Revenue Bonds, 5.125% (Original Issue Yield:
5.61%), 3/1/2022 AA+ 1,801,140
800,000 Randolph County, NC, Certificates of
Participation, 4.875% (MBIA INS)/(Original
Issue Yield: 5.05%), 6/1/2006 AAA 802,208
500,000 Robeson County, NC, GO UT Refunding Revenue
Bonds, 4.90% (AMBAC INS), 2/1/2007 AAA 501,615
1,025,000 Sanford, NC, GO UT Bonds, 4.90% (MBIA INS),
3/1/2009 AAA 1,015,232
</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
$1,085,000 Shelby, NC Housing Development Corp.,
Mortgage Revenue Bonds, 6.10% (Hickory Creek
Apartments)/ (FHA INS), 2/1/2023 AAA $ 1,088,841
2,500,000 University of North Carolina at Chapel Hill,
Hospital Revenue Bonds, 5.25%, 2/15/2026 AA 2,219,050
6,220,000 University of North Carolina at Chapel Hill,
Refunding Bonds, 5.00% (Original Issue
Yield: 5.65%), 8/1/2011 AA 6,135,781
8,200,000 University of North Carolina at Chapel Hill,
Utility Refunding Bonds, 5.00% (Original
Issue Yield: 5.60%), 8/1/2010 AA 8,149,242
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
1,000,000 Wake County, NC, GO UT Bonds, 4.50%
(Original Issue Yield: 4.52%), 3/1/2008 AAA 968,760
3,000,000 Wake County, NC, GO UT Bonds, 4.50%
(Original Issue Yield: 4.72%), 3/1/2010 AAA 2,837,940
4,000,000 Wake County, NC, GO UT Bonds, 4.50%,
3/1/2002 AAA 4,020,360
7,925,000 Wake County, NC, GO UT Bonds, 4.60%
(Original Issue Yield: 4.87%), 3/1/2012 AAA 7,372,945
500,000 Wake County, NC, GO UT Refunding Bonds,
4.60% (Original Issue Yield: 4.70%),
4/1/2004 AAA 501,630
650,000 Wake County, NC, GO UT Refunding Bonds,
4.70% (Original Issue Yield: 4.80%),
4/1/2005 AAA 652,425
7,400,000 Wake County, NC, GO UT, 4.50% (Original
Issue Yield: 4.62%), 3/1/2009 AAA 7,088,386
</TABLE>
<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 $ 1,259,308
825,000 Winston-Salem, NC Water & Sewer System,
Refunding Bonds, 5.00%, 6/1/2012 AA+ 800,745
2,745,000 Winston-Salem, NC Water & Sewer System,
Revenue Bonds, 4.80% (Original Issue Yield:
4.90%), 6/1/2013 AA+ 2,544,533
3,350,000 Winston-Salem, NC Water & Sewer System,
Revenue Bonds, 4.875% (Original Issue Yield:
4.95%), 6/1/2014 AA+ 3,093,725
3,725,000 Winston-Salem, NC Water & Sewer System,
Revenue Bonds, 5.00% (Original Issue Yield:
5.03%), 6/1/2016 AA+ 3,435,381
------------
Total 422,436,746
------------
Puerto Rico--1.5%
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 39,537
400,000 Puerto Rico Electric Power Authority,
(Series W), 5.00% (MBIA LOC)/(Original Issue
Yield: 5.05%), 7/1/2004 AAA 408,604
2,955,000 Puerto Rico Electric Power Authority,
Revenue Bonds (Series DD), 5.00% (MBIA
INS)/(Original Issue Yield: 5.28%), 7/1/2028 AAA 2,596,233
4,045,000 Puerto Rico Highway and Transportation
Authority, Refunding Revenue Bonds (Series A), 5.00% (AMBAC
LOC)/(Original Issue Yield:
5.16%), 7/1/2028 AAA 3,553,897
------------
Total 6,598,271
------------
Total Long-Term Municipals (identified cost
$432,684,518) 429,035,017
------------
</TABLE>
(See Notes to Portfolios of Investments)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia North Carolina Municipal Bond Fund
<TABLE>
<CAPTION>
Shares Value
- ---------------------------------------------------------------------
<C> <S> <C> <C>
Open-End Investment Companies--2.0%
3,836,588 AIM Global Management Money Market Fund $ 3,836,588
1,030,665 Dreyfus Tax Exempt Money Market Fund 1,030,665
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C> <C>
Open-End Investment Companies--continued
278,230 Federated Tax-Free Obligations Fund $ 278,230
3,796,045 Fidelity Tax Exempt Money Market Fund 3,796,045
------------
Total Open-End Investment Companies (at cost) 8,941,528
------------
Total Investments (identified cost $441,626,046) $437,976,545
------------
</TABLE>
(See Notes to Portfolios of Investments)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia South Carolina Municipal Bond Fund (Class A Shares)
Growth of $10,000 Invested in Wachovia South Carolina Municipal Bond Fund
(Class A Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia South Carolina Municipal Bond Fund (Class A Shares) (the "Fund") from
January 11, 1991 (start of performance) to November 30, 1999 compared to the
Lehman Brothers State General Obligation Bond Index (LBSGOBI) and the Lehman
Brothers Municipal Bond Index (LBMBI).+
[Please see Appendix A32]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund after deducting
the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge
= $9,550). The Fund's performance assumes the reinvestment of all dividends
and distributions. The LBSGOBI and the LBMBI has been adjusted to reflect the
reinvestment of dividends on securities in the index.
** Total returns quoted reflect all applicable sales charges and contingent
deferred sales charges.
+ The LBSGOBI is an unmanaged index comprised of all state general obligation
debt issues and is compiled without regard to maturities. These bonds are
rated A or better and represent a variety of coupon ranges. The LBMBI is an
unmanaged index generally representative of the performance of the municipal
bond market as a whole. The investment adviser has elected to change the
benchmark from LBSGOBI to LBMBI. The LBMBI is more representative of the
securities typically held by the Fund. The indices are not adjusted to
reflect sales charges, expenses, or other fees that the SEC requires to be
reflected in the Fund's performance. Investments cannot be made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia South Carolina Municipal Bond Fund (Class Y Shares)
Growth of $10,000 Invested in Wachovia South Carolina Municipal Bond Fund
(Class Y Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia South Carolina Municipal Bond Fund (Class Y Shares) (the "Fund") from
July 23, 1996 (start of performance) to November 30, 1999 compared to the Lehman
Brothers State General Obligation Bond Index (LBSGOBI) and the Lehman Brothers
Municipal Bond Index (LBMBI).+
[Please see Appendix A33]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* The Fund's performance assumes the reinvestment of all dividends and
distributions. The LBSGOBI and the LBMBI has been adjusted to reflect the
reinvestment of dividends on securities in the index.
+ The LBSGOBI is an unmanaged index comprised of all state general obligation
debt issues and is compiled without regard to maturities. These bonds are
rated A or better and represent a variety of coupon ranges. The LBMBI is an
unmanaged index generally representative of the performance of the municipal
bond market as a whole. The investment adviser has elected to change the
benchmark from LBSGOBI to LBMBI. The LBMBI is more representative of the
securities typically held by the Fund. The indices are not adjusted to
reflect sales charges, expenses, or other fees that the SEC requires to be
reflected in the Fund's performance. Investments cannot be made in an index.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia South Carolina Municipal Bond Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--98.4%
South Carolina--98.1%
$ 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 $ 548,710
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 575,478
850,000 Barnwell County, SC School District No. 45,
GO UT, 5.40% (Original Issue Yield: 5.45%),
2/1/2009 AAA 866,881
1,600,000 Beaufort County, SC School District, GO UT,
(Series B), 4.85% (MBIA INS), 3/1/2004 AAA 1,614,880
1,300,000 Beaufort County, SC School District, GO UT,
4.70%, 3/1/2006 AA 1,289,288
500,000 Beaufort County, SC, Certificate of
Participation, 5.00% (Hilton Head Airport),
7/1/2001 NR 503,575
675,000 Beaufort County, SC, Certificates of
Participation, 7.125% (AMBAC INS)/
(Original Issue Yield: 7.45%), 6/1/2012 AAA 698,976
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$ 2,855,000 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 $ 2,884,035
750,000 Berkeley County, SC Pollution Control
Facilities, 6.50% (South Carolina Electric
and Gas), 10/1/2014 A 784,920
1,500,000 Berkeley County, SC Water & Sewer,
Refunding Revenue Bonds, 5.50% (MBIA
INS)/(Original Issue Yield: 5.55%),
6/1/2013 AAA 1,507,410
2,420,000 Berkeley County, SC Water & Sewer,
Refunding Revenue Bonds, 5.55% (MBIA
INS)/(Original Issue Yield: 5.60%),
6/1/2014 AAA 2,411,651
1,040,000 Berkeley County, SC Water & Sewer,
Refunding Revenue Bonds, 6.55% (MBIA INS),
6/1/2002 AAA 1,091,574
1,000,000 Camden, SC Public Utility, Revenue
Refunding Bonds, 5.50% (MBIA INS)/
(Original Issue Yield: 5.80%), 3/1/2022 AAA 946,550
2,000,000 Cayce SC, Water and Sewer, Refunding
Revenue Bond, 5.25% (AMBAC INS)/ (Original
Issue Yield: 5.65%), 7/1/2015 AAA 1,906,760
</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
$ 1,105,000 Charleston County, SC Airport District,
Airport System Refunding Revenue Bonds,
4.75% (MBIA INS), 7/1/2015 AAA $ 981,240
1,950,000 Charleston County, SC Park & Recreational
Community, Go UT, 5.20% (Original Issue
Yield: 5.25%), 2/1/2002 AA- 1,984,573
1,000,000 Charleston County, SC School District,
Certificate of Participation, 5.625%
(Original Issue Yield: 5.761%), 2/1/2003 A 1,018,150
3,000,000 Charleston County, SC School District, GO
UT School Improvement, 4.00%, 2/1/2002 AA 2,976,990
5,500,000 Charleston County, SC, 5.50% (Charleston
Public Facilities Corp.)/(MBIA INS)/
(Original Issue Yield: 5.70%), 12/1/2015 AAA 5,394,015
3,495,000 Charleston County, SC, 6.00% (MBIA LOC)/
(Original Issue Yield: 5.40%), 12/1/2009 AAA 3,734,827
500,000 Charleston County, SC, 7.05%, 2/1/2002 A 512,205
3,260,000 Charleston, SC Waterworks and Sewer, 5.00%
(MBIA INS), 1/1/2022 AAA 2,865,540
1,000,000 Charleston, SC Waterworks and Sewer, 6.00%
(Original Issue Yield: 6.242%), 1/1/2012 AA- 1,032,580
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$ 2,000,000 Charleston, SC Waterworks and Sewer,
Refunding Revenue Bond, 5.50% (Original
Issue Yield: 6.10%), 1/1/2008 AA- $ 2,018,900
7,030,000 Charleston, SC Waterworks and Sewer,
Refunding Revenue Bond, 6.00% (AMBAC
INS)/(Original Issue Yield: 6.201%),
1/1/2016 AAA 7,127,717
2,000,000 Charleston, SC Waterworks and Sewer,
Refunding Revenue Bond, 6.00% (Original
Issue Yield: 6.285%), 1/1/2018 AA- 2,013,160
4,295,000 Charleston, SC Waterworks and Sewer,
Refunding Revenue Bonds, 5.125%, 1/1/2013 AA- 4,196,773
9,500,000 Charleston, SC Waterworks and Sewer,
Revenue Refunding Bonds, 4.50% (FGIC
LOC)/(Original Issue Yield: 5.03%),
1/1/2024 AAA 7,568,460
1,900,000 Charleston, SC, Certificates of
Participation, 5.00% (AMBAC INS)/ (Original
Issue Yield: 5.39%), 9/1/2015 AAA 1,741,483
1,000,000 Charleston, SC, Certificates of
Participation, 7.10% (MBIA INS)/(United
States Treasury PRF), 6/1/2001
(Callable @102) AAA 1,059,710
250,000 Charleston, SC, GO Bonds (Series A), 6.30%,
9/1/2005 AA 262,367
</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
$ 1,155,000 Chester County, SC School District, GO UT, 5.30% (AMBAC
INS)/(Original Issue Yield:
5.45%), 2/1/2011 AAA $ 1,157,957
875,000 Chester County, SC School District, GO UT,
6.85% (United States Treasury PRF)/
(Original Issue Yield: 6.95%), 2/1/2012 AA 896,665
1,140,000 Chester County, SC School District, GO UT,
5.30% (AMBAC INS)/(Original Issue Yield:
5.50%), 2/1/2012 AAA 1,130,743
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 1,152,855
1,000,000 Clover, SC School District No 2 York
County, GO UT, 6.00%, 2/1/2001 AA 1,019,700
2,785,000 Clover, SC School District No 2 York
County, GO UT, 6.10%, 2/1/2002 AA 2,881,974
840,000 College Francis Marion SC, Revenue State
College Board Trustees, Refunding Revenue
Bond, 7.00%, 4/1/2001 864,998
1,000,000 Columbia, SC Waterworks & Sewer System,
Refunding Revenue Bond, 5.30% (Original
Issue Yield: 5.50%), 2/1/2006 AA 1,021,430
1,705,000 Columbia, SC Waterworks & Sewer System,
Refunding Revenue Bond, 6.50% (Original
Issue Yield: 6.55%), 2/1/2002 AA 1,778,213
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$ 2,970,000 Columbia, SC Waterworks & Sewer System,
Refunding Revenue Bonds, 5.70%, 2/1/2010 AA $ 3,115,797
2,160,000 Columbia, SC Waterworks & Sewer System,
Revenue Bonds, 5.00%, 2/1/2003 AA 2,193,026
2,000,000 Columbia, SC, Parking Facilities Refunding
Revenue Bonds, 5.875% (AMBAC INS)/
(Original Issue Yield: 6.007%), 12/1/2013 AAA 2,055,380
1,250,000 Dillon County SC, Health Facilities,
Refunding Revenue Bond, 6.25% (MBIA INS),
6/1/2008 AAA 1,326,812
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 1,042,294
3,000,000 Dorchester County, SC School District No.
002, GO UT Bonds, 5.20% (FGIC INS),
2/1/2018 AAA 2,783,340
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 2,104,965
1,000,000 Dorchester County, SC School District No.
002, GO UT, 5.50% (AMBAC INS)/ (Original
Issue Yield: 5.55%), 1/1/2005 AAA 1,028,450
870,000 Edgefield County, SC School District, GO UT
Bonds, 6.40% (FSA INS)/(Original Issue
Yield: 6.60%), 2/1/2009 AAA 933,762
</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
$ 1,155,000 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 $ 1,170,396
2,000,000 Fairfield County, SC, PCR Bonds, 6.50%
(South Carolina Electric and Gas), 9/1/2014 A+ 2,130,840
1,000,000 Fairfield County, SC, PCR Bond, 6.50%
(South Carolina Electric and Gas)/ (MBIA
INS), 9/1/2014 AAA 1,068,110
1,000,000 Florence County, SC Hospital, Refunding
Revenue Bond, 5.25% (FGIC INS)/(Original
Issue Yield: 5.457%), 11/1/2009 AAA 1,001,720
1,500,000 Florence County, SC Hospital, Revenue
Bonds, 4.75% (Mcleod Regional Medical
Center)/(MBIA INS)/ (Original Issue Yield:
4.75%), 11/1/2027 AAA 1,206,345
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 522,275
1,485,000 Florence County, SC, Law Enforcement
Control Project, 5.70% (AMBAC INS)/
(Original Issue Yield: 5.90%), 3/1/2003 AAA 1,537,242
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$ 1,220,000 Florence County, SC, Law Enforcement
Control Project, 6.00% (AMBAC INS)/
(Original Issue Yield: 6.15%), 3/1/2006 AAA $ 1,278,218
1,600,000 Florence, SC Water & Sewer, Refunding
Revenue Bond, 5.20% (AMBAC INS)/ (Original
Issue Yield: 5.35%), 3/1/2007 AAA 1,620,016
3,805,000 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 4,203,003
1,800,000 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 1,805,994
1,230,000 Greenville County, SC, Certificate of
Participation, PRF, 6.80% (AMBAC INS),
3/1/2005 AAA 1,292,140
500,000 Greenville County, SC, IRB, 7.10% (Lockheed
Aeromod Center Incorporated Project),
11/1/2011 BBB- 518,855
1,000,000 Greenville, SC Hospital System Facilities,
Refunding Revenue Bond, (Series A), 5.75%
(Original Issue Yield: 6.00%), 5/1/2014 AA 998,490
</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
$10,250,000 Greenville, SC Hospital System Facilities,
Refunding Revenue Bonds (Series B), 5.25%
(Original Issue Yield: 6.125%), 5/1/2023 AA $ 9,129,983
600,000 Greenville, SC Hospital System Facilities,
Refunding Revenue Bonds, 5.75% (Original
Issue Yield: 5.95%), 5/1/2013 AA 603,348
10,480,000 Greenville, SC Hospital System Facilities,
Revenue Bonds (Series B), 5.25% (Original
Issue Yield: 6.076%), 5/1/2017 AA 9,621,269
760,000 Greenville, SC Hospital System Facilities,
Revenue Bonds, 7.00% (Greenville Health
Corp.)/(Original Issue Yield: 7.454%),
5/1/2017 AAA 784,464
2,000,000 Greenville, SC Waterworks Revenue, Revenue
Bonds, 5.50% (Original Issue Yield: 5.60%),
2/1/2022 AA 1,902,540
1,020,000 Greenwood County, SC Hospital, Refunding
Revenue Bond, 5.875% (Self Memorial
Hospital)/(MBIA INS)/ (Original Issue
Yield: 6.112%), 10/1/2017 1,017,674
1,400,000 Greenwood SC, Combined Public Utility,
Refunding Revenue Bond, 5.35% (AMBAC INS)/
(Original Issue Yield: 5.45%), 12/1/2005 AAA 1,445,276
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$ 1,320,000 Greenwood SC, Combined Public Utility,
Refunding Revenue Bond, 5.70% (AMBAC INS),
12/1/2010 AAA $ 1,354,069
1,125,000 Greer, SC Combined Utility System, Revenue
Bonds, 4.75% (AMBAC LOC)/(Original Issue
Yield: 4.85%), 9/1/2011 AAA 1,064,227
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 1,020,040
2,000,000 Hilton Head Public Services District No. 1,
SC, Water Workes & Sewer Refunding Revenue
Bond, 5.50% (MBIA INS)/(Original Issue
Yield: 5.80%), 8/1/2015 AAA 1,971,980
4,000,000 Hilton Head Public Services District No. 1,
SC, Waterworks and Sewer Systems Revenue
Bonds, 5.50% (MBIA INS)/(Original Issue
Yield: 5.85%), 8/1/2020 AAA 3,821,480
2,350,000 Lancaster County, SC School District, GO
UT, 5.25% (FSA INS)/ (Original Issue Yield:
5.39%), 3/1/2014 AAA 2,277,597
1,960,000 Lancaster County, SC School District, GO UT, 6.50% (MBIA
INS)/(Original Issue Yield:
6.599%), 7/1/2008 AAA 2,096,259
</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
$ 3,650,000 Lancaster County, SC Water & Sewer
District, Refunding Revenue Bond, 5.20%
(FGIC INS)/(Original Issue Yield: 5.32%),
5/1/2015 AAA $ 3,459,580
1,030,000 Laurens County, SC Health Care Systems, GO
UT, 5.70% (MBIA INS), 1/1/2008 AAA 1,055,287
1,025,000 Laurens County, SC School District Number
055, GO UT, 5.50% (FGIC INS), 3/1/2016 AAA 1,006,027
1,395,000 Laurens, SC Public Utility, Refunding
Revenue Bond, 5.00% (FGIC INS)/(Original
Issue Yield: 5.393%), 1/1/2018 AAA 1,251,468
655,000 Lexington & Richland Counties, SC School
District No. 005, GO UT Bonds, 5.05% (MBIA
INS), 3/1/2005 AAA 664,753
4,000,000 Lexington County, SC Health Services District, Inc., Refunding
Revenue Bonds, 5.125% (FSA INS)/(Original Issue Yield:
5.50%), 11/1/2021 AAA 3,516,400
1,210,000 Lexington County, SC Health Services
District, Inc., Revenue Bond, 6.60% (FSA
INS)/(Original Issue Yield: 6.65%),
10/1/2001 AAA 1,260,167
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$ 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 $ 2,157,475
370,000 Lexington County, SC School Distict Number
001, Prerefunded Certificate
Participation,, 6.90% (MBIA INS), 9/1/2003 AAA 393,162
805,000 Medical University of South Carolina,
Hospital Facilities Revenue Bonds, 5.25%
(MBIA INS)/(Original Issue Yield: 5.25%),
7/1/2004 AAA 824,875
3,750,000 North Charleston, SC Sewer District,
Refunding Revenue Bond, 6.375% (MBIA
INS)/(Original Issue Yield: 6.508%),
7/1/2012 AAA 4,143,900
3,100,000 North Charleston, SC Sewer District,
Refunding Revenue Bonds (Series A), 6.00%
(MBIA INS)/ (Original Issue Yield: 6.593%),
7/1/2018 AAA 3,113,392
500,000 North Charleston, SC Sewer District,
Revenue Bonds (Series B), 6.00% (MBIA INS)/
(Original Issue Yield: 6.593%), 7/1/2018 AAA 519,765
2,075,000 North Charleston, SC, Certificate of
Participation, 5.50% (FGIC INS)/(Original
Issue Yield: 5.65%), 1/1/2002 AAA 2,122,227
</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
$ 1,670,000 North Charleston, SC, GO UT, 5.50%
(Original Issue Yield: 5.60%), 8/1/2006 AA- $ 1,725,210
1,000,000 North Charleston, SC, GO UT, 5.50%,
8/1/2005 AA- 1,038,080
275,000 Oconee County, SC School District, GO UT Bonds, 5.10% (MBIA
INS)/(Original Issue
Yield: 5.50%), 9/1/2013 AAA 265,309
1,000,000 Oconee County, SC School District, GO UT,
5.00% (Original Issue Yield: 5.35%),
9/1/2010 AAA 986,440
1,155,000 Oconee County, SC School District, GO UT,
5.10% (Original Issue Yield: 5.40%),
9/1/2011 AAA 1,140,355
1,090,000 Oconee County, SC School District, GO UT,
5.10% (Original Issue Yield: 5.45%),
9/1/2012 AAA 1,065,246
2,500,000 Oconee County, SC, PCR Refunding Bonds,
5.80% (Duke Energy Corp.), 4/1/2014 AA- 2,515,125
590,000 Piedmont Municipal Power Agency, SC,
Electricity Refunding Revenue Bonds, 6.85%
(FGIC INS), 1/1/2007 AAA 615,813
290,000 Piedmont Municipal Power Agency, SC,
Escrowed to Maturity, Refunding Revenue
Bond, 6.50% (FGIC INS)/(Original Issue
Yield: 6.625%), 1/1/2014 AAA 320,409
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$ 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 $ 1,038,404
695,000 Piedmont Municipal Power Agency, SC,
Refunding Revenue Bonds, 5.50% (MBIA
INS)/(Original Issue Yield: 5.60%),
1/1/2013 AAA 706,322
1,000,000 Piedmont Municipal Power Agency, SC,
Refunding Revenue Bonds, 6.50% (FGIC
INS)/(Original Issue Yield: 6.88%),
1/1/2011* AAA 1,040,080
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 1,323,225
1,000,000 Richland County, SC Hospital Facilities,
Refunding Revenue Bond, (Series B), 5.00%
(Richland Memoral Hospital)/(MBIA INS)/
(Original Issue Yield: 5.15%), 6/1/2005 AAA 1,032,330
1,000,000 Richland County, SC Hospital Facilities,
Refunding Revenue Bond, 4.90% (Richland
Memoral Hospital)/ (MBIA INS)/(Original
Issue Yield: 5.05%), 6/1/2004 AAA 1,029,120
</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
$ 2,435,000 Richland County, SC Hospital Facilities,
Revenue Bonds (Series PG-A), 7.10%
(Community Provider Pooled Loan Program)/
(CGIC INS), 7/1/2005 AAA $ 2,646,090
3,175,000 Richland County, SC School District No.
001, GO UT, 4.625%, 3/1/2022 AA 2,631,504
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 BBB+ 684,158
1,390,000 Richland County, SC, GO UT Refunding Bonds
(Series B), 6.25% (State Aid Withholding
LOC), 3/1/2001 AA 1,424,416
1,645,000 Richland County, SC, GO UT, (Series C),
5.80% (Original Issue Yield: 5.85%),
3/1/2007 AA 1,708,958
1,000,000 Richland County, SC, Refunding Revenue
Bond, (Series C), 6.10%, 11/1/2004 BBB+ 1,040,990
1,000,000 Richland County, SC, Refunding Revenue
Bond, (Series C), 6.20%, 11/1/2005 BBB+ 1,041,330
1,000,000 Richland County, SC, Refunding Revenue
Bond, (Series C), 6.30%, 11/1/2006 BBB+ 1,040,120
130,000 Rock Hill, SC Housing Development Corp.,
Multi-family Refunding Revenue Bonds,
7.50%, 7/1/2010 NR 135,265
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$ 2,630,000 Rock Hill, SC Utility System, Refunding
Revenue Bond, 5.25% (AMBAC INS)/ (Original
Issue Yield: 5.40%), 1/1/2008 AAA $ 2,659,666
2,190,000 South Carolina Job Development Authority,
(Series A) Refunding Bonds, 5.20% (South
Carolina Baptist Hospital)/ (AMBAC LOC)/
(Original Issue Yield: 5.30%), 8/1/2006 AAA 2,217,528
2,000,000 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 1,888,880
500,000 South Carolina Resources Authority, Local
Government Program, Revenue Bonds (Series
A), 7.00%, 6/1/2003 A+ 516,565
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 1,038,950
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 1,030,000
</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
$ 3,475,000 South Carolina State Housing Finance &
Development Authority, Refunding Revenue
Bonds (Series A), 6.15%, 7/1/2008 AA $ 3,548,184
1,200,000 South Carolina State Housing Finance &
Development Authority, Revenue Bonds
(Series A), 7.30% (FHA/VA mtgs GTD),
7/1/2011 AA 1,250,592
1,000,000 South Carolina State Housing Finance &
Development Authority, Revenue Bonds
(Series A-1), 6.45% (FHA/VA mtgs GTD),
7/1/2017 NR 1,023,570
500,000 South Carolina State Housing Finance &
Development Authority, Revenue Bonds
(Series C), 7.70% (FHA/VA mtgs GTD),
7/1/2011 AA 512,480
520,000 South Carolina State Housing Finance &
Development Authority, Revenue Bonds
(Series C), 7.75% (FHA/VA mtgs GTD),
7/1/2022 AA 533,910
1,000,000 South Carolina State Ports Authority,
Revenue Bonds, 6.50% (AMBAC INS)/ (Original
Issue Yield: 6.75%), 7/1/2006 AAA 1,052,540
1,000,000 South Carolina State Ports Authority,
Revenue Bonds, 6.625% (AMBAC INS)/(Original
Issue Yield: 6.823%), 7/1/2011 AAA 1,054,440
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$ 525,000 South Carolina State Ports Authority,
Revenue Bonds, 6.75% (AMBAC INS)/ (Original
Issue Yield: 6.90%), 7/1/2021 AAA $ 554,568
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 2,128,135
5,000,000 South Carolina State Public Service
Authority, (Series D) Electric Light and
Power Improvements, 6.625% (Original Issue
Yield: 6.70%), 7/1/2031 AAA 5,362,700
5,000,000 South Carolina State Public Service
Authority, Electric, Light, & Power
Improvement Refunding Revenue Bonds, 7.10%,
7/1/2021 AAA 5,310,500
2,200,000 South Carolina State Public Service
Authority, Refunding Revenue Bond, (Series
B), 5.875% (FGIC INS)/(Original Issue
Yield: 6.19%), 1/1/2023 AAA 2,161,698
2,500,000 South Carolina State Public Service
Authority, Refunding Revenue Bond, (Series
C), 5.00% (AMBAC INS)/(Original Issue
Yield: 5.25%), 1/1/2014 AAA 2,346,950
</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
$ 2,585,000 South Carolina State Public Service
Authority, Refunding Revenue Bond, 5.125%
(MBIA INS)/(Original Issue Yield: 5.40%),
1/1/2021 AAA $ 2,289,741
2,250,000 South Carolina State Public Service Authority, Refunding Revenue
Bond, 5.50% (AMBAC INS)/ (Original Issue Yield:
5.834%), 1/1/2023 AAA 2,093,040
2,500,000 South Carolina State Public Service
Authority, Refunding Revenue Bonds(Series
A), 5.125% (MBIA INS)/(Original Issue
Yield: 5.35%), 1/1/2032 AAA 2,132,400
1,000,000 South Carolina State Public Service
Authority, Refunding Revenue Bonds, 5.00%
(MBIA INS)/(Original Issue Yield: 5.15%),
1/1/2014 AAA 938,780
2,500,000 South Carolina State Public Service Authority, Refunding Revenue
Bonds, 5.00% (MBIA LOC)/(Original Issue Yield: 5.20%),
1/1/2025 AAA 2,136,100
1,000,000 South Carolina State Public Service
Authority, Revenue Bond, (Series D), 5.80%
(Santee Cooper), 7/1/2000 AA- 1,009,970
2,000,000 South Carolina State Public Service
Authority, Revenue Bond, 5.00% (MBIA
INS)/(Original Issue Yield: 5.20%),
1/1/2015 AAA 1,850,900
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$ 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 $ 2,085,564
2,500,000 South Carolina State Public Service
Authority, Revenue Refunding Bonds, 5.00%
(FGIC INS)/ (Original Issue Yield: 5.30%),
1/1/2018 AAA 2,242,775
1,040,000 South Carolina State, (Series A) GO UT
Highway Improvement Bonds, 4.50%, 4/1/2020 AAA 863,938 2,540,000
South Carolina State, GO UT (Series A)
Highway Improvement Bonds, 4.50% (Original
Issue Yield: 4.90%), 2/1/2010 AAA 2,401,748
2,625,000 South Carolina State, GO UT (Series A)
Highway Improvement Bonds, 4.50% (Original
Issue Yield: 4.95%), 2/1/2011 AAA 2,446,343
800,000 South Carolina State, GO UT (Series A)
Highway Improvement Bonds, 4.50%, 4/1/2021 AAA 659,528
1,000,000 South Carolina State, GO UT (Series A),
6.20% (Original Issue Yield: 4.75%),
2/1/2000 AAA 1,003,840
1,400,000 South Carolina State, GO UT (Series B)
Highway Improvement Bonds, 5.625%, 7/1/2008 AAA 1,470,882
</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
$ 1,000,000 South Carolina State, GO UT (Series W),
6.00% (Medical University of South
Carolina), 5/1/2000 AAA $ 1,008,780
1,210,000 South Carolina State, GO UT Bonds (Series
A), 4.50% (State Highway), 4/1/2023 AAA 986,816
3,900,000 South Carolina State, GO UT Bonds (Series
A), 4.60% (Original Issue Yield: 4.93%),
5/1/2019 AAA 3,313,908
4,500,000 South Carolina State, GO UT Revenue Bonds (Series A), 5.00%
(Original Issue Yield:
5.45%), 3/1/2008 AAA 4,528,215
1,150,000 South Carolina State, GO UT, 4.50% (State
Highway), 4/1/2022 AAA 942,241
1,000,000 South Carolina State, GO UT, 5.75%
(Original Issue Yield: 4.70%), 8/1/2003 AAA 1,045,670
325,000 South Carolina State, GO UT, 6.00% (Medical
University of South Carolina)/ (Original
Issue Yield: 6.05%), 3/1/2002 AAA 333,050
350,000 South Carolina State, GO UT, 6.00% (Medical
University of South Carolina)/ (Original
Issue Yield: 6.15%), 3/1/2003 AAA 358,670
375,000 South Carolina State, GO UT, 6.00% (Medical
University of South Carolina)/ (Original
Issue Yield: 6.25%), 3/1/2004 AAA 384,289
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$ 975,000 South Carolina State, Revenue Bond, 4.00%
(Columbia Mill Building)/(MBIA INS)/
(Original Issue Yield: 5.10%), 2/1/2007 AAA $ 904,829
3,200,000 South Carolina State, Revenue Bonds, GO UT,
(Series A), 6.35%, 3/1/2001 AAA 3,285,152
1,000,000 South Carolina State, Series A) GO UT,
4.25% (Original Issue Yield: 5.60%),
3/1/2009 AAA 938,910
590,000 South Carolina State, State Capital
Improvement (Series B), 5.75%, 8/1/2000 AAA 597,263
10,900,000 South Carolina Transportation
Infrastructure Bank, Revenue Bonds (Series
A), 4.50% (MBIA INS), 10/1/2016 AAA 9,248,214
1,640,000 South Carolina Transportation
Infrastructure Bank, Revenue Bonds (Series
A), 5.00% (MBIA LOC), 10/1/2007 AAA 1,647,806
6,000,000 South Carolina Transportation
Infrastructure Bank, Revenue Bonds, 4.50%
(MBIA INS), 10/1/2014 AAA 5,222,400
1,000,000 Spartanburg County, SC Health Services
District, Inc., Refunding Revenue Bond,
(Series B), 5.125% (MBIA INS)/ (Original
Issue Yield: 5.55%), 4/15/2022 AAA 876,790
</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
$ 2,595,000 Spartanburg County, SC Health Services District, Inc.,
Refunding Revenue Bond, 5.00% (AMBAC INS)/(Original Issue Yield:
5.60%), 4/15/2011 AAA $ 2,530,047
3,000,000 Spartanburg County, SC Health Services District, Inc., Refunding
Revenue Bonds, 5.50% (AMBAC INS)/(Original Issue Yield:
5.70%), 4/15/2015 AAA 2,943,390
1,125,000 Spartanburg County, SC Hospital Facilities,
Revenue Bond, (Series B), 6.20%
(Spartanburg General Hospital System)/(FSA
INS), 4/15/2002 AAA 1,167,683
955,000 Spartanburg County, SC Hospital Facilities,
Revenue Bond, (Series B), 6.30%
(Spartanburg General Hospital System)/(FSA
INS), 4/15/2003 AAA 1,012,768
3,000,000 Spartanburg County, SC Hospital Facilities,
Revenue Refunding Bonds, 6.55% (Spartanburg
General Hospital System)/(FSA INS),
4/15/2010 AAA 3,167,130
450,000 Spartanburg, SC Leased Housing Corp.,
Refunding Revenue Bonds, 7.50%, 10/1/2011 NR 471,510
1,000,000 Spartanburg, SC Waterworks, Refunding
Revenue Bonds, 5.00% (FGIC INS), 6/1/2027 AAA 861,690
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
South Carolina--continued
$ 1,755,000 Sumter County, SC Hospital Facilities,
Refunding Revenue Bond, 6.45% (Tuomey
Regional Medical Center)/(MBIA INS)/
(Original Issue Yield: 6.55%), 11/15/2000 AAA $ 1,793,084
2,000,000 Sumter County, SC Hospital Facilities,
Refunding Revenue Bond, 6.50% (Tuomey
Regional Medical Center)/(MBIA INS)/
(Original Issue Yield: 6.80%), 11/15/2002 AAA 2,109,300
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 1,081,710
2,295,000 University South Carolina, Parking
Facilities Refunding Revenue Bonds, 5.00%
(MBIA INS)/(Original Issue Yield: 5.40%),
5/1/2015 AAA 2,132,652
1,015,000 University of South Carolina, Revenue Bond,
5.60% (AMBAC INS)/(Original Issue Yield:
5.70%), 6/1/2017 996,689
3,465,000 University of South Carolina, Revenue
Bonds, 5.70% (MBIA INS), 6/1/2020 AAA 3,385,201
</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
$ 2,000,000 Western Carolina Regional Sewer Authority, SC, Partially
Prerefunded Revenue Bond, 7.00% (AMBAC INS)/(Original Issue Yield:
7.125%), 3/1/2002 AAA $ 2,053,980
1,000,000 Western Carolina Regional Sewer Authority,
SC, Refunding Revenue Bond, 5.10% (FGIC
INS)/(Original Issue Yield: 5.20%),
3/1/2004 AAA 1,018,080
2,090,000 Western Carolina Regional Sewer Authority,
SC, Refunding Revenue Bond, 5.40% (FGIC
INS)/(Original Issue Yield: 5.465%),
3/1/2007 AAA 2,135,290
4,800,000 Western Carolina Regional Sewer Authority,
SC, Sewer System Revenue Bonds, 5.50% (FGIC
INS)/ (Original Issue Yield: 5.627%),
3/1/2010 AAA 4,867,248
1,830,000 York County, SC PCR, Refunding Revenue
Bond, (Series A), 7.40%, 1/1/2010 BBB 1,890,536
1,000,000 York County, SC, GO UT Refunding Bonds,
4.90% (AMBAC INS)/ (Original Issue Yield:
5.10%), 6/1/2010 AAA 973,670
3,050,000 York County, SC, GO UT, 4.70% (AMBAC
INS)/(Original Issue Yield: 4.85%),
6/1/2006 AAA 3,024,899
------------
Total 341,811,331
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Credit
or Shares Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
Puerto Rico--0.3%
$ 35,000 Puerto Rico Commonwealth Infrastructure
Financing Authority, Revenue Bonds (Series
A), 5.00% (AMBAC LOC)/(Original Issue
Yield: 5.28%), 7/1/2028 AAA $ 30,751
1,115,000 Puerto Rico Electric Power Authority,
Revenue Bonds (Series DD), 5.00% (MBIA
INS)/(Original Issue Yield: 5.28%),
7/1/2028 AAA 979,628
150,000 Puerto Rico Highway and Transportation
Authority, Refunding Revenue Bonds (Series
A), 5.00% (AMBAC LOC)/(Original Issue
Yield: 5.16%), 7/1/2028 AAA 131,789
------------
Total 1,142,168
------------
Total Long-Term Municipals (identified cost
$345,009,437) 342,953,499
------------
Open-End Investment Companies--0.4%
255,903 AIM Global Management Money Market Fund 255,903
140,598 Dreyfus Tax Exempt Money Market Fund 140,598
817,013 Fidelity Tax Exempt Money Market Fund 817,013
------------
Total Open-End Investment Companies (at cost) 1,213,514
------------
Total Investments (identified cost $346,222,951) $344,167,013
------------
</TABLE>
(See Notes to Portfolios of Investments)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Virginia Municipal Bond Fund (Class A Shares)
Growth of $10,000 Invested in Wachovia Virginia Municipal Bond Fund (Class A
Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Virginia Municipal Bond Fund (Class A Shares) (the "Fund") from
February 1, 1993 (start of performance) to November 30, 1999 compared to the
Lehman Brothers Municipal Bond Index (LBMBI),+ and the Lehman Brothers Municipal
Bond 7-Year Index (LBMB7YI).+
[Please see Appendix A34]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* Represents a hypothetical investment of $10,000 in the Fund after deducting
the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge
= $9,550). The Fund's performance assumes the reinvestment of all dividends
and distributions. The LBMBI and LBMB7YI have been adjusted to reflect the
reinvestment of dividends on securities in the indices.
** Total returns quoted reflect all applicable sales charges and contingent
deferred sales charges.
+ The LBMBI is an unmanaged index generally representative of the performance
of the municipal bond market as a whole. The LBMB7YI is an unmanaged index
representative of municipal bonds with remaining maturities of seven years.
The indices do not reflect sales charges, expenses, or other fees that the
SEC requires to be reflected in the Fund's performance. Investments cannot be
made in an index.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Virginia Municipal Bond Fund (Class Y Shares)
Growth of $10,000 Invested in Wachovia Virginia Municipal Bond Fund (Class Y
Shares)
The graph below illustrates the hypothetical investment of $10,000* in the
Wachovia Virginia Municipal Bond Fund (Class Y Shares) (the "Fund") from March
29, 1998 (start of performance) to November 30, 1999 compared to the Lehman
Brothers Municipal Bond Index (LBMBI)+ and Lehman Brothers Municipal Bond 7-
Year Index (LBMB7YI).+
[Please see Appendix A35]
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Mutual funds are not obligations
of or guaranteed by any bank and are not federally insured.
* The Fund's performance assumes the reinvestment of all dividends and
distributions. The LBMBI and LBMB7YI have been adjusted to reflect the
reinvestment of dividends on securities in the indices.
+ The LBMBI is an unmanaged index generally representative of the performance
of the municipal bond market as a whole. The LBMB7YI is an unmanaged index
representative of municipal bonds with remaining maturities of seven years.
The indices do not reflect sales charges, expenses, or other fees that the
SEC requires to be reflected in the Fund's performance. Investments cannot be
made in an index.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Virginia Municipal Bond Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
- -------------------------------------------------------------------------------
<C> <S> <C> <C>
Long-Term Municipals--95.4%
Virginia--94.3%
$ 500,000 Albemarle County, VA, Refunding Revenue
Bonds, 5.50% (Original Issue Yield: 5.634%),
8/1/2006 A+ $ 512,665
250,000 Alexandria, VA, GO UT, 5.65% (Original Issue
Yield: 5.70%), 12/1/2001 AAA 257,073
850,000 Arlington County, VA, GO UT Refunding Bonds,
6.00%, 6/1/2004 AAA 901,272
500,000 Arlington County, VA, GO UT, 5.00%,
7/15/2000 AAA 503,475
1,000,000 Arlington County, VA, GO UT, 5.40% (Original
Issue Yield: 5.55%), 6/1/2015 AAA 988,120
1,255,000 Arlington County, VA, Refunding Bonds, 4.70%
(Original Issue Yield: 4.75%), 6/1/2006 AAA 1,253,820
2,080,000 Arlington, VA IDA, Revenue Bonds, 5.45% (The
Nature Conservancy)/(Original Issue Yield:
5.57%), 7/1/2027 Aa1 1,937,915
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 1,020,327
200,000 Augusta County, VA IDA, Refunding Revenue
Bond, 6.30% (AMBAC INS)/(Original Issue
Yield: 6.40%), 9/1/2002 AAA 210,572
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 2,116,580
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
Virginia--continued
$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 $ 956,990
1,750,000 Chesapeake, VA, GO UT, 5.40% (Original Issue
Yield: 5.50%), 5/1/2008 AA 1,803,008
1,485,000 Chesterfield County, VA, 4.50% (Original
Issue Yield: 4.75%), 1/1/2019 AAA 1,246,464
1,000,000 Chesterfield County, VA, GO UT, 5.60%
(Original Issue Yield: 5.65%), 7/15/2006 AAA 1,043,660
250,000 Culpeper, VA IDA, Refunding Revenue Bond,
6.40% (FHA INS), 1/15/2003 AA- 254,078
600,000 Danville, VA, GO UT, 6.40% (Original Issue
Yield: 6.45%), 5/1/2009 A3 638,100
500,000 Danville, VA, GO UT, 6.40% (Original Issue
Yield: 6.50%), 5/1/2010 A3 531,750
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 957,320
400,000 Fairfax County, VA IDA, Refunding Revenue
Bonds, 5.00% (Inova Health System)/(Original
Issue Yield: 5.10%), 8/15/2008 AA 393,188
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 1,166,287
</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 Fairfax County, VA IDA, Refunding Revenue
Bonds, 5.25% (Inova Health System)/(Original
Issue Yield: 5.35%), 8/15/2019 AA $ 924,210
2,735,000 Fairfax County, VA Water Authority,
Refunding Revenue Bonds, 6.00% (Original
Issue Yield: 6.281%), 4/1/2022 AAA 2,968,159
1,265,000 Fairfax County, VA Water Authority,
Refunding Revenue Bonds, 6.00% (Original
Issue Yield: 6.281%), 4/1/2022 AA 1,276,840
500,000 Fairfax County, VA Water Authority, Revenue
Bonds, 5.00% (Original Issue Yield: 5.375%),
4/1/2016 AA 461,325
3,800,000 Fairfax County, VA Water Authority,
Refunding Revenue Bonds, 5.00% (Original
Issue Yield: 5.22%), 4/1/2021 AA 3,402,520
1,000,000 Fairfax County, VA Water Authority,
Refunding Revenue Bonds, 5.00% (Original
Issue Yield: 5.30%), 4/1/2029 AA 863,290
570,000 Fairfax County, VA, (Series B) GO UT, 6.00%
(Original Issue Yield: 6.10%), 5/1/2007 AAA 582,323
2,000,000 Fairfax County, VA, GO UT Refunding Bonds
(Series A), 4.50% (Original Issue Yield:
4.68%), 6/1/2013 AAA 1,803,180
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
Virginia--continued
$ 500,000 Fairfax County, VA, GO UT, (Series A), 5.00%
(Original Issue Yield: 5.07%), 6/1/2018 AAA $ 457,365
850,000 Fairfax County, VA, GO UT, 4.50% (Original
Issue Yield: 4.426%), 6/1/2010 801,984
5,000,000 Fairfax County, VA, GO UT, 4.50% (Original
Issue Yield: 4.73%), 6/1/2014 AAA 4,438,200
500,000 Hampton, VA Sanitation District, Refunding
Revenue Bond, 4.30% (Original Issue Yield:
4.40%), 10/1/2000 AA 501,565
1,000,000 Hampton, VA, GO UT, 5.90% (Original Issue
Yield: 6.00%), 1/15/2007 AA 1,068,610
500,000 Hanover County, VA IDA, Revenue Bond, 4.50%
(Original Issue Yield: 4.60%), 8/15/2000 AAA 501,475
500,000 Hanover County, VA IDA, Revenue Bond, 5.375%
(Original Issue Yield: 5.55%), 5/1/2004 Aa 509,610
250,000 Hanover County, VA IDA, Revenue Bond, 6.00%
(MBIA INS)/(Original Issue Yield: 6.10%),
10/1/2001 AAA 257,520
1,000,000 Hanover County, VA IDA, Revenue Bonds, 6.375%
(Memorial Regional Medical Center)/(MBIA
INS), 8/15/2018 AAA 1,059,000
</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
$ 250,000 Harrisonburg, VA Redevelopment & Housing
Authority, Refunding Revenue Bond, 6.60%
(Original Issue Yield: 6.70%), 9/1/2002 A2 $ 264,337
2,000,000 Henrico County, VA, GO UT Refunding Bonds,
5.30% (Original Issue Yield: 5.45%),
1/15/2010 AAA 2,023,560
1,000,000 Henrico County, VA, Refunding Revenue Bonds,
6.25% (Original Issue Yield: 6.65%),
5/1/2013 AA- 1,026,840
250,000 Henry County, VA Public Service Authority,
Refunding Revenue Bond, 6.00% (FGIC
INS)/(Original Issue Yield: 6.05%),
11/15/2003 AAA 259,525
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 1,008,150
250,000 Loudoun County, VA Sanitation Authority,
Refunding Revenue Bond, 6.00% (FGIC
INS)/(Original Issue Yield: 6.05%), 1/1/2003 AAA 260,937
1,000,000 Loudoun County, VA Sanitation Authority,
Revenue Bonds, 4.75% (MBIA INS), 1/1/2021 AAA 849,920
1,000,000 Loudoun County, VA Sanitation Authority,
Revenue Bonds, 4.75% (MBIA INS)/(Original
Issue Yield: 5.04%), 1/1/2030 AAA 817,880
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
Virginia--continued
$ 250,000 Loudoun County, VA, Refunding Revenue Bond,
6.875%, 3/1/2001 AA $ 256,782
1,000,000 Manassa, VA, GO UT, 5.00% (Original Issue
Yield: 5.05%), 1/1/2012 AA- 972,130
50,000 Metropolitan Washington, DC Airports
Authority, Refunding Revenue Bond, 4.90%
(MBIA INS)/(Original Issue Yield: 5.00%),
10/1/2005 AAA 50,489
1,000,000 Newport News, VA, GO UT (Series A), 5.20%
(Original Issue Yield: 5.35%), 1/15/2018 AA 931,060
1,000,000 Newport News, VA, GO UT (Series A), 6.00%
(Original Issue Yield: 6.05%), 6/1/2006 AA 1,046,620
1,000,000 Newport News, VA, GO UT (Series A), 6.00%
(Original Issue Yield: 6.10%), 6/1/2007 AA 1,048,860
500,000 Newport News, VA, GO UT Bonds (Series A),
5.80% (Original Issue Yield: 5.85%),
6/1/2004 AA 518,720
500,000 Norfolk, VA IDA, Refunding Bonds (Series A),
4.20% (Sentara Hospitals), 11/1/2000 AA 500,515
900,000 Norfolk, VA IDA, Refunding Revenue Bonds,
5.50% (Sentara Hospitals), 11/1/2017 AA 859,977
1,000,000 Norfolk, VA IDA, Refunding Revenue Bonds,
6.50% (Daughter's Charity-DePaul Hospital),
12/1/2007 AA+ 1,076,050
</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
$2,500,000 Norfolk, VA IDA, Refunding Revenue Bonds,
6.50% (Sentara Hospitals), 11/1/2013 AA $ 2,688,925
100,000 Norfolk, VA IDA, Revenue Bonds (Series A),
6.75% (Children's Hospital King's Group),
6/1/2001 103,257
250,000 Norfolk, VA IDA, Revenue Bonds, 6.80%
(Sentara Hospitals)/(Original Issue Yield:
6.85%), 11/1/2002 AA 266,055
500,000 Norfolk, VA Water System, Revenue Bonds,
5.90% (MBIA INS)/(Original Issue Yield:
6.194%), 11/1/2025 AAA 497,275
1,000,000 Norfolk, VA, GO UT (Series A), 5.90%
(Original Issue Yield: 6.00%), 2/1/2006 AA 1,038,670
1,000,000 Norfolk, VA, GO UT Refunding Bonds (Series
A), 6.00% (Original Issue Yield: 6.20%),
2/1/2008 AA 1,039,790
125,000 Norfolk, VA, GO UT Refunding Bonds, 5.00%
(FGIC INS), 7/1/2009 AAA 124,759
500,000 Norfolk, VA, GO UT Refunding Bonds, 5.00%
(FGIC INS)/(Original Issue Yield: 5.05%),
7/1/2015 AAA 465,855
1,000,000 Norfolk, VA, GO UT Refunding Bonds, 5.25%
(Original Issue Yield: 5.35%), 2/1/2006 AA 1,019,170
3,000,000 Norfolk, VA, GO UT Refunding Bonds, 5.25%
(Virginia State GTD)/(Original Issue Yield:
5.35%), 6/1/2008 AA 3,036,420
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
Virginia--continued
$2,000,000 Norfolk, VA, GO UT Refunding Bonds, 5.50%
(Original Issue Yield: 5.55%), 2/1/2008 AA $ 2,045,360
500,000 Peumansend Creek Regional Jail Authority,
VA, Revenue Bonds, 5.00% (MBIA
INS)/(Original Issue Yield: 5.05%), 6/1/2006 AAA 504,835
250,000 Portsmouth, VA, GO UT Refunding Bonds,
6.25%, 11/1/2002 AA- 262,447
500,000 Prince William County, VA, Certificate
Participation Refunding Bonds, 5.20% (MBIA
INS)/(Original Issue Yield: 5.35%),
12/1/2005 AAA 509,410
500,000 Prince William County, VA, GO UT Bonds (Series C), 5.00% (Original
Issue Yield:
5.10%), 8/1/2006 AA 505,995
1,000,000 Prince William County, VA, GO UT Refunding
Bonds, 5.90% (Original Issue Yield: 6.00%),
12/1/2003 AA 1,038,390
1,980,000 Richmond, VA Metropolitan Authority,
Refunding Revenue Bonds, 5.25% (FGIC LOC),
7/15/2022 AAA 1,826,055
1,000,000 Richmond, VA Public Utility, Refunding
Revenue Bonds, 5.125% (FGIC LOC)/(Original
Issue Yield: 5.31%), 1/15/2028 AAA 879,420
1,500,000 Richmond, VA, GO UT Bonds, 5.50% (State Aid
Withholding INS)/(Original Issue Yield:
5.72%), 7/15/2023 AA 1,419,375
</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 Richmond, VA, GO UT Refunding Bonds (Series B), 5.00% (FGIC
INS)/(Original Issue Yield:
5.259%), 1/15/2021 AAA $ 885,990
1,000,000 Rivanna Water & Sewer Authority, Refunding
Revenue Bonds, 4.80% (Original Issue Yield:
5.10%), 10/1/2015 A+ 897,900
500,000 Roanoke County, VA Water System, Refunding
Revenue Bonds, 5.00% (FGIC INS), 7/1/2021 AAA 442,380
250,000 Roanoke, VA IDA, Refunding Bonds (Series B),
5.80% (Roanoke Memorial Hospital)/(Original
Issue Yield: 5.90%), 7/1/2005 AA- 257,012
250,000 Roanoke, VA, GO UT Bonds (Series B), 6.00%,
8/1/2003 AA 258,147
2,225,000 Roanoke, VA, GO UT Bonds, 5.25% (Original
Issue Yield: 5.30%), 8/1/2024 AA 2,007,417
1,000,000 Roanoke, VA, GO UT Bonds, 6.20%, 8/1/2005 AA 1,040,440
1,250,000 Roanoke, VA, GO UT Bonds, 6.30% (Original
Issue Yield: 6.35%), 8/1/2007 AA 1,308,375
500,000 Southeastern Public Service Authority, VA,
Refunding Bonds (Series A), 4.90% (MBIA
INS)/(Original Issue Yield: 4.95%), 7/1/2006 AAA 500,675
500,000 Spotsylvania County, VA, GO UT Bonds, 5.40%
(Original Issue Yield: 5.45%), 7/15/2004 A+ 515,940
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
Virginia--continued
$1,000,000 Spotsylvania County, VA, GO UT Bonds, 5.50%
(Original Issue Yield: 5.55%), 7/15/2005 A+ $ 1,044,140
1,000,000 Spotsylvania County, VA, GO UT Bonds, 5.70%
(Original Issue Yield: 5.75%), 7/15/2007 A+ 1,049,040
1,500,000 University of Virginia, Refunding Revenue
Bonds (Series A), 5.20% (Original Issue
Yield: 5.45%), 6/1/2015 AA+ 1,433,880
6,010,000 Upper Occoquan Sewage Authority, VA, (Series
A), 4.75% (MBIA LOC)/(Original Issue Yield:
5.30%), 7/1/2029 AAA 4,922,010
250,000 Upper Occoquan Sewage Authority, VA,
Refunding Bonds, 5.45% (AMBAC INS)/(Original
Issue Yield: 5.55%), 7/1/2003 AAA 257,900
250,000 Virginia Beach, VA IDA, Hospital Facilities
Revenue Bonds, 6.30% (Sentara Bayside
Hospital)/(Sentara Bayside Hospital
LOC)/(Original Issue Yield: 6.35%),
11/1/2004 AA 263,833
500,000 Virginia Beach, VA IDA, Refunding Bonds,
5.00% (AMBAC INS)/(Original Issue Yield:
5.15%), 2/15/2007 AAA 501,010
250,000 Virginia Beach, VA, Certificate of
Participation, 6.90% (FGIC INS)/(Original
Issue Yield: 6.95%), 9/1/2000 AAA 255,465
1,250,000 Virginia Beach, VA, GO UT Bonds (Series C),
6.10% (Original Issue Yield: 6.15%),
8/1/2002 AA 1,304,125
</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 Virginia Beach, VA, GO UT Bonds, 5.70%,
7/15/2006 AA $ 1,049,810
250,000 Virginia Beach, VA, GO UT Bonds, 5.80%,
2/1/2003 AA 259,820
1,000,000 Virginia Beach, VA, GO UT Bonds, 5.80%,
7/15/2007 AA 1,052,260
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 1,082,520
860,000 Virginia College Building Authority, (Series
A), 5.00% (Original Issue Yield: 5.275%),
9/1/2016 AA 790,710
1,000,000 Virginia College Building Authority,
Refunding Revenue Bonds, 5.80% (Washington &
Lee University Project), 1/1/2024 AAA 1,059,840
815,000 Virginia College Building Authority, Revenue
Bonds (Series A), 4.625%, 9/1/2014 AA 725,317
500,000 Virginia College Building Authority, Revenue
Bonds, 5.00%, 8/1/2008 AA 500,835
500,000 Virginia Commonwealth Transportation Board,
Revenue Bonds (Series A), 5.00%, 5/15/2004 AA 508,270
1,500,000 Virginia Polytechnical Institute & State
University, Refunding Revenue Bonds (Series
C), 5.50% (Original Issue Yield: 5.70%),
6/1/2016 AA 1,468,965
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
Virginia--continued
$ 500,000 Virginia State Housing Development
Authority, Refunding Revenue Bonds, 6.10%,
1/1/2007 AA+ $ 506,560
500,000 Virginia State Housing Development
Authority, Refunding Revenue Bonds, 6.20%,
1/1/2008 AA+ 513,090
500,000 Virginia State Housing Development
Authority, Refunding Revenue Bonds, 6.30%,
1/1/2009 AA+ 515,205
400,000 Virginia State Housing Development
Authority, Refunding Revenue Bonds, 6.45%,
5/1/2001 AA+ 405,472
985,000 Virginia State Housing Development
Authority, Revenue Bonds (Series A), 6.40%,
7/1/2017 AA+ 1,004,139
1,000,000 Virginia State Housing Development
Authority, Revenue Bonds (Series B), 6.35%,
1/1/2015 AA+ 1,026,610
1,000,000 Virginia State Housing Development
Authority, Revenue Bonds (Series B), 6.55%,
1/1/2011 AA+ 1,028,580
500,000 Virginia State Housing Development
Authority, Revenue Bonds (Series C), 5.45%,
7/1/2002 AA+ 505,165
710,000 Virginia State Housing Development
Authority, Revenue Bonds (Series F), 6.40%,
7/1/2017 AA+ 722,553
2,000,000 Virginia State Public Building Authority,
(Series A) Refunding Bonds, 5.40%, 8/1/2012 AA 2,006,320
515,000 Virginia State Public Building Authority,
(Series B), 5.50% (Original Issue Yield:
5.63%), 8/1/2014 AA 514,186
</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
$ 300,000 Virginia State Public Building Authority,
Refunding Bonds (Series A), 5.00%, 8/1/2004 AA $ 304,656
3,000,000 Virginia State Public Building Authority,
Refunding Revenue Bonds, 5.00% (Original
Issue Yield: 4.64%), 8/1/2009 AA 2,982,750
500,000 Virginia State Public Building Authority,
Revenue Bonds (Series C), 5.20% (Original
Issue Yield: 5.30%), 8/1/2003 AA 511,600
2,500,000 Virginia State Public School Authority,
(Series A) Revenue Bonds, 6.00% (State Aid
Withholding LOC), 8/1/2006 AA 2,665,625
2,550,000 Virginia State Public School Authority,
(Series B), 5.25% (Original Issue Yield:
5.58%), 1/1/2010 AA 2,567,697
2,000,000 Virginia State Public School Authority,
Refunding Revenue Bonds, 5.00% (Original
Issue Yield: 5.10%), 8/1/2012 AA+ 1,942,300
250,000 Virginia State Public School Authority,
Revenue Bonds (Series A), 6.30% (Original
Issue Yield: 6.40%), 8/1/2001 AA 258,178
1,000,000 Virginia State Public School Authority,
Refunding Revenue Bonds, 6.25% (Original
Issue Yield: 6.30%), 1/1/2004 AA 1,051,220
</TABLE>
<TABLE>
<CAPTION>
Principal Credit
Amount Rating* Value
<C> <S> <C> <C>
Long-Term Municipals--continued
Virginia--continued
$ 300,000 Virginia State Public School Authority,
School Financing Revenue Bonds (Series B),
5.75% (State Aid Withholding COL), 1/1/2008 AA $ 309,708
250,000 Virginia State Resource Authority Solid
Waste Disposal Systems, Revenue Bonds
(Series B), 5.20%, 5/1/2003 AA 255,440
225,000 Virginia State Resources Authority Water and
Sewer System, Refunding Bonds, 5.65%
(Original Issue Yield: 5.75%), 10/1/2004 AA 234,875
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 980,190
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 1,046,020
690,000 Virginia State Resources Authority Water and
Sewer System, Revenue Bonds, 5.50% (Original
Issue Yield: 5.80%), 10/1/2022 AA 654,320
500,000 Virginia State Transportation Board, Revenue
Bonds, 5.80%, 5/15/2001 AA 510,800
</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
$ 250,000 Virginia State, GO UT Bonds (Series A),
5.90% (Original Issue Yield: 5.95%),
6/1/2000 AAA $ 252,523
250,000 Virginia State, GO UT Bonds (Series C),
5.80%, 6/1/2004 AAA 257,445
1,000,000 Virginia State, GO UT Bonds, 5.50% (Original
Issue Yield: 5.55%), 6/1/2006 AAA 1,038,150
1,000,000 Virginia State, GO UT Bonds, 6.00%, 6/1/2006 AAA 1,038,370
750,000 Washington County, VA IDA, Refunding Revenue
Bonds, 6.00% (Original Issue Yield: 6.16%),
7/1/2014 A2 802,635
------------
Total 129,670,063
------------
Puerto Rico--1.1%
1,595,000 Puerto Rico Commonwealth Infrastructure Financing Authority, Revenue
Bonds (Series A), 5.00% (AMBAC LOC)/(Original Issue Yield:
5.28%), 7/1/2028 AAA 1,401,352
40,000 Puerto Rico Electric Power Authority,
Revenue Bonds (Series DD), 5.00% (MBIA
INS)/(Original Issue Yield: 5.28%), 7/1/2028 AAA 35,144
</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 $ 39,537
------------
Total 1,476,033
------------
Total Long-Term Municipals (identified cost
$131,915,377) 131,146,096
------------
Open-End Investment Companies--3.8%
2,065,841 AIM Global Management Short Term Investments 2,065,841
364 Dreyfus Tax Exempt Money Market 364
3,145,179 Fidelity Tax Exempt Money Market 3,145,179
------------
Total Open-End Investment Companies (at
cost) 5,211,384
------------
Total Investments (identified cost
$137,126,761) $136,357,480
------------
</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) Current rate and next demand date shown.
(5) 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 Directors. At November
30, 1999, Emerging Markets Fund held restricted securities amounting to
$6,698,819, which represents 3.4% of net assets.
The following abbreviations are used in these portfolios:
ADR--American Depositary Receipt IFA--Industrial Finance Authority
AMBAC--American Municipal Bond INS--Insured
Assurance Corporation IRB--Industrial Revenue Bond
BAN--Bank Anticipation Note LOC--Letter of Credit
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 PRF--Prerefunded
Association SFM--Single Family Mortgage
FSA--Financial Security Assurance UT--Unlimited Tax
GDR--Global Depositary Receipt VA--Veterans Administration
GO--General Obligation VRDN-Variable Rate Demand Note
GTD--Guaranteed
HFA--Housing Finance Authority
IDA--Industrial Development
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 258,746,673 93,447,232 101,666,353 8,219,121 351,836,262
Quantitative Equity Fund 361,717,904 350,479,813 354,674,568 4,194,755 712,212,696
Growth and Income Fund 193,510,223 156,181,380 156,923,599 742,219 349,593,378
Equity Index Fund 281,729,436 263,978,579 273,810,716 9,832,137 544,631,351
Special Value Fund 169,706,043 5,889,981 21,257,438 15,367,457 175,667,583
Emerging Markets Fund 160,489,346 33,590,790 51,781,705 18,190,915 194,449,828
Personal Equity Fund 262,487,978 183,741,142 187,810,827 4,069,685 444,562,356
Balanced Fund 531,063,252 117,365,604 136,570,399 19,204,795 650,598,794
Fixed Income Fund 570,897,953 (18,418,815) 2,153,392 20,572,207 558,275,832
Intermediate Fixed In-
come Fund 142,796,517 (2,956,883) 773,980 3,730,863 141,712,691
Short-Term Fixed Income
Fund 48,639,998 (526,241) 203,673 729,914 48,732,245
Georgia Municipal Bond
Fund 113,851,863 (1,425,854) 1,509,477 2,935,331 114,205,551
North Carolina Municipal
Bond Fund 441,637,516 (3,638,031) 6,538,634 10,176,665 443,167,488
South Carolina Municipal
Bond Fund 346,222,951 (2,048,965) 6,255,568 8,304,533 348,455,611
Virginia Municipal Bond
Fund 137,126,761 (769,281) 2,425,864 3,195,145 137,493,589
</TABLE>
** The categories of investments are shown as a percentage of net assets at
November 30, 1999.
At November 30, 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 0.5%
North Carolina Municipal
Bond Fund 0.3%
South Carolina Municipal
Bond Fund 2.3%
</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
November 30, 1999
<TABLE>
<CAPTION>
Wachovia Wachovia Wachovia Wachovia
Wachovia Quantitative Growth & Equity Index Special
Equity Fund Equity Fund Income Fund Fund Values Fund
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Assets:
Investments in
securities, at value $318,020,832 $698,100,782 $339,399,506 $507,806,995 $141,369,072
Investments in
repurchase agreements 34,173,073 14,096,935 10,292,097 37,901,020 34,226,952
Income receivable 351,759 690,994 315,716 622,389 215,112
Receivable for
investments sold 2,224,723 -- -- 250,728 752,916
Receivable for shares
sold 538,693 1,473,383 247,375 415,485 595,901
------------ ------------ ------------ ------------ ------------
Total assets 355,309,080 714,362,094 350,254,694 546,996,617 177,159,953
------------ ------------ ------------ ------------ ------------
Liabilities:
Payable for
investments purchased 2,348,838 -- -- 726,691 972,364
Payable for shares
redeemed 101,334 1,285,315 80,217 490,760 292,774
Payable to adviser 179,328 393,733 213,790 134,049 114,001
Payable for daily
variation margin 727,650 195,107 289,515 835,841 21,250
Accrued expenses 115,668 275,243 77,794 177,925 91,981
------------ ------------ ------------ ------------ ------------
Total liabilities 3,472,818 2,149,398 661,316 2,365,266 1,492,370
------------ ------------ ------------ ------------ ------------
Net Assets Consist of:
Paid in capital 248,138,610 361,639,339 133,971,417 268,552,475 161,177,709
Net unrealized
appreciation of
investments, futures
contracts, and
translation of assets
and liabilities in
foreign currency 95,227,495 351,352,262 156,642,309 264,852,798 6,115,370
Accumulated net
realized gain (loss)
on investments,
futures, and foreign
currency transactions 8,120,549 (873,668) 58,786,756 10,132,224 5,654,239
Undistributed net
investment income 349,608 94,763 192,896 1,093,854 2,720,265
------------ ------------ ------------ ------------ ------------
Total Net Assets $351,836,262 $712,212,696 $349,593,378 $544,631,351 $175,667,583
------------ ------------ ------------ ------------ ------------
Net Assets
Class A Shares $118,967,111 $ 89,140,198 $ 94,674,157 $182,697,398 $ 65,348,415
------------ ------------ ------------ ------------ ------------
Class B Shares $ 8,991,592 $ 24,652,354 -- -- $ 350,021
------------ ------------ ------------ ------------ ------------
Class Y Shares $223,877,559 $598,420,144 $254,919,221 $361,933,953 $109,969,147
------------ ------------ ------------ ------------ ------------
Shares Outstanding
Class A Shares 6,830,417 4,244,152 3,807,705 6,979,128 4,077,085
Class B Shares 519,148 1,178,965 -- -- 21,890
Class Y Shares 12,850,672 28,441,672 10,244,607 13,807,435 6,843,214
------------ ------------ ------------ ------------ ------------
Total Shares
Outstanding 20,200,237 33,864,789 14,052,312 20,786,563 10,942,189
------------ ------------ ------------ ------------ ------------
Net Asset Value Per
Share
Class A Shares $ 17.42 $ 21.00 $ 24.86 $ 26.18 $ 16.03
------------ ------------ ------------ ------------ ------------
Class B Shares $ 17.32 $ 20.91 -- -- $ 15.99
------------ ------------ ------------ ------------ ------------
Class Y Shares $ 17.42 $ 21.04 $ 24.88 $ 26.21 $ 16.07
------------ ------------ ------------ ------------ ------------
Offering Price Per
Share*
Class A Shares $ 18.24** $ 21.99** $ 26.03** $ 27.41** $ 16.79**
------------ ------------ ------------ ------------ ------------
Class B Shares $ 17.32 $ 20.91 -- -- $ 15.99
------------ ------------ ------------ ------------ ------------
Class Y Shares $ 17.42 $ 21.04 $ 24.88 $ 26.21 $ 16.07
------------ ------------ ------------ ------------ ------------
Redemption Proceeds
Per Share*
Class A Shares $ 17.42 $ 21.00 $ 24.86 $ 26.18 $ 16.03
------------ ------------ ------------ ------------ ------------
Class B Shares $ 16.45*** $ 19.86*** -- -- $ 15.19***
------------ ------------ ------------ ------------ ------------
Class Y Shares $ 17.42 $ 21.04 $ 24.88 $ 26.21 $ 16.07
------------ ------------ ------------ ------------ ------------
Investments, at
identified cost $257,839,803 $361,717,904 $193,342,506 $281,724,101 $169,645,754
------------ ------------ ------------ ------------ ------------
Investments, at tax
cost $258,746,673 $361,717,904 $193,510,223 $281,729,436 $169,706,043
------------ ------------ ------------ ------------ ------------
</TABLE>
* See "What do Shares Cost" in the Prospectus.
** Computation of Offering Price: 100\95.50 of net asset value.
*** Computation of Redemption Price: 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
November 30, 1999
<TABLE>
<CAPTION>
Wachovia Wachovia Wachovia
Emerging Personal Wachovia Wachovia Intermediate
Markets Equity Balanced Fixed Income Fixed Income
Fund Fund Fund Fund Fund
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Assets:
Investments in
securities, at value $187,890,917 $439,059,133 $638,718,929 $545,123,872 $135,684,402
Investments in
repurchase agreements 6,189,219 7,169,987 9,709,927 7,355,266 4,155,232
Cash denominated in
foreign currencies 1,083,997 -- -- -- --
Income receivable 337,281 423,196 2,975,783 5,221,210 1,503,498
Receivable for
investments sold 275,631 2,854 2,971,567 549,571 440,767
Receivable for shares
sold 441,553 -- 535,212 921,028 81,095
------------ ------------ ------------ ------------ ------------
Total assets 196,218,598 446,655,170 654,911,418 559,170,947 141,864,994
------------ ------------ ------------ ------------ ------------
Liabilities:
Payable for
investments purchased 3,436 -- 3,132,722 219,294 23,825
Payable for shares
redeemed 1,086,511 1,317,342 523,996 84,376 1,000
Payable for capital
gains taxes withheld 368,894 -- -- -- --
Payable for daily
variation margin -- 344,925 9,016 132,329 10,031
Payable to adviser 153,608 256,520 340,191 271,878 68,374
Accrued expenses 156,321 174,027 306,699 187,238 49,073
------------ ------------ ------------ ------------ ------------
Total liabilities 1,768,770 2,092,814 4,312,624 895,115 152,303
------------ ------------ ------------ ------------ ------------
Net Assets Consist of:
Paid in capital 185,713,595 252,555,395 527,490,709 578,280,790 144,472,220
Net unrealized
appreciation
(depreciation) of
investments, futures
contracts, and
translation of assets
and liabilities in
foreign currency 34,796,120 183,948,683 118,981,957 (18,537,915) (2,910,922)
Accumulated net
realized gain (loss)
on investments,
futures, and foreign
currency transactions (27,440,055) 7,806,983 2,066,625 (2,059,929) 33,824
Undistributed net
investment income 1,380,168 251,295 2,059,503 592,886 117,569
------------ ------------ ------------ ------------ ------------
Total Net Assets $194,449,828 $444,562,356 $650,598,794 $558,275,832 $141,712,691
------------ ------------ ------------ ------------ ------------
Net Assets
Class A Shares $ 16,006,640 $ 109,744 $205,166,649 $ 69,475,002 $ 3,205,137
------------ ------------ ------------ ------------ ------------
Class B Shares -- -- $ 20,926,567 $ 819,074 --
------------ ------------ ------------ ------------ ------------
Class Y Shares $178,443,188 $444,452,612 $424,505,578 $487,981,756 $138,507,554
------------ ------------ ------------ ------------ ------------
Shares Outstanding
Class A Shares 1,363,725 10,285 15,250,570 7,298,488 334,959
Class B Shares -- -- 1,560,350 86,077 --
Class Y Shares 15,180,508 41,629,797 31,520,188 51,280,029 14,473,236
------------ ------------ ------------ ------------ ------------
Total Shares
Outstanding 16,544,233 41,640,082 48,331,108 58,664,594 14,808,195
------------ ------------ ------------ ------------ ------------
Net Asset Value Per
Share
Class A Shares $ 11.74 $ 10.67 $ 13.45 $ 9.52 $ 9.57
------------ ------------ ------------ ------------ ------------
Class B Shares -- -- $ 13.41 $ 9.52 --
------------ ------------ ------------ ------------ ------------
Class Y Shares $ 11.75 $ 10.68 $ 13.47 $ 9.52 $ 9.57
------------ ------------ ------------ ------------ ------------
Offering Price Per
Share*
Class A Shares $ 12.29** $ 11.17** $ 14.08** $ 9.97** $ 10.02**
------------ ------------ ------------ ------------ ------------
Class B Shares -- -- $ 13.41 $ 9.52 --
------------ ------------ ------------ ------------ ------------
Class Y Shares $ 11.75 $ 10.68 $ 13.47 $ 9.52 $ 9.57
------------ ------------ ------------ ------------ ------------
Redemption Proceeds
Per Share*
Class A Shares $ 11.74 $ 10.67 $ 13.45 $ 9.52 $ 9.57
------------ ------------ ------------ ------------ ------------
Class B Shares -- -- $ 12.74*** $ 9.04*** --
------------ ------------ ------------ ------------ ------------
Class Y Shares $ 11.75 $ 10.68 $ 13.47 $ 9.52 $ 9.57
------------ ------------ ------------ ------------ ------------
Investments, at
identified cost $159,271,222 $262,487,978 $529,476,986 $570,881,826 $142,796,517
------------ ------------ ------------ ------------ ------------
Investments, at tax
cost $160,489,346 $262,487,978 $531,063,252 $570,897,953 $142,796,517
------------ ------------ ------------ ------------ ------------
</TABLE>
*See "What do Shares Cost" in the Prospectus.
**Computation of Offering Price: 100\95.50 of net asset value.
***Computation of Redemption Price: 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
November 30, 1999
<TABLE>
<CAPTION>
Wachovia Wachovia
Wachovia Wachovia North South Wachovia
Short Term Georgia Carolina Carolina Virginia
Fixed Income Municipal Municipal Municipal Municipal
Fund Bond Fund Bond Fund Bond Fund Bond Fund
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Assets:
Investments in
securities, at value $43,716,482 $112,426,009 $437,976,545 $344,167,013 $136,357,480
Investments in
repurchase agreements 4,397,275 -- -- -- --
Income receivable 616,771 2,141,141 6,564,286 6,031,642 2,539,742
Receivable for shares
sold 82,342 150,000 524,992 -- --
Deferred
organizational costs -- -- 8,168 -- --
Other assets -- -- 6,190 -- --
----------- ------------ ------------ ------------ ------------
Total assets 48,812,870 114,717,150 445,080,181 350,198,655 138,897,222
----------- ------------ ------------ ------------ ------------
Liabilities:
Payable for shares
redeemed 26,620 2,181 -- 246,722 785,315
Income distribution
payable -- 425,164 1,577,384 1,244,309 516,121
Payable to adviser 18,640 30,905 142,607 109,826 47,215
Accrued expenses 35,365 53,349 192,702 142,187 54,982
----------- ------------ ------------ ------------ ------------
Total liabilities 80,625 511,599 1,912,693 1,743,044 1,403,633
----------- ------------ ------------ ------------ ------------
Net Assets Consist of:
Paid in capital 52,188,521 116,191,310 446,542,980 350,448,958 139,690,732
Net unrealized
appreciation
(depreciation) of
investments, futures
contracts, and
translation of assets
and liabilities in
foreign currency (526,241) (1,425,854) (3,649,501) (2,055,938) (769,281)
Accumulated net
realized gain (loss)
on investments,
futures, and foreign
currency transactions (3,064,915) (575,481) 245,432 63,977 (1,435,169)
Undistributed net
investment income 134,880 15,576 28,577 (1,386) 7,307
----------- ------------ ------------ ------------ ------------
Total Net Assets $48,732,245 $114,205,551 $443,167,488 $348,455,611 $137,493,589
----------- ------------ ------------ ------------ ------------
Net Assets
Class A Shares $10,408,947 $ 5,450,288 $ 8,644,277 $ 59,655,366 $ 7,682,572
----------- ------------ ------------ ------------ ------------
Class Y Shares $38,323,298 $108,755,263 $434,523,211 $288,800,245 $129,811,017
----------- ------------ ------------ ------------ ------------
Shares Outstanding
Class A Shares 1,080,626 513,760 806,163 5,646,106 780,367
Class Y Shares 3,978,997 10,251,540 40,522,854 27,333,816 13,185,478
----------- ------------ ------------ ------------ ------------
Total Shares
Outstanding 5,059,623 10,765,300 41,329,017 32,979,922 13,965,845
----------- ------------ ------------ ------------ ------------
Net Asset Value Per
Share
Class A Shares $ 9.63 $ 10.61 $ 10.72 $ 10.57 $ 9.84
----------- ------------ ------------ ------------ ------------
Class Y Shares $ 9.63 $ 10.61 $ 10.72 $ 10.57 $ 9.84
----------- ------------ ------------ ------------ ------------
Offering Price Per
Share*
Class A Shares $ 9.88*** $ 11.11** $ 11.23** $ 11.07** $ 10.30**
----------- ------------ ------------ ------------ ------------
Class Y Shares $ 9.63 $ 10.61 $ 10.72 $ 10.57 $ 9.84
----------- ------------ ------------ ------------ ------------
Redemption Proceeds
Per Share*
Class A Shares $ 9.63 $ 10.61 $ 10.72 $ 10.57 $ 9.84
----------- ------------ ------------ ------------ ------------
Class Y Shares $ 9.63 $ 10.61 $ 10.72 $ 10.57 $ 9.84
----------- ------------ ------------ ------------ ------------
Investments, at
identified cost $48,639,998 $113,851,863 $441,626,046 $346,222,951 $137,126,761
----------- ------------ ------------ ------------ ------------
Investments, at tax
cost $48,639,998 $113,851,863 $441,637,516 $346,222,951 $137,126,761
----------- ------------ ------------ ------------ ------------
</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.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds and The Wachovia Municipal Funds
Statements of Operations
Year Ended November 30, 1999
<TABLE>
<CAPTION>
Wachovia Wachovia
Wachovia Quantitative Wachovia Wachovia Special
Equity Equity Growth & Equity Values
Fund Fund Income Fund Index Fund Fund
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Investment Income:
Dividends $ 2,554,864 $ 5,462,963 $ 3,540,389 $ 5,817,702 $ 3,317,159
Interest 2,181,840 1,553,806 948,653 2,961,887 1,358,375
----------- ----------- ----------- ----------- -----------
Total income 4,736,704 7,016,769 4,489,042 8,779,589 4,675,534
----------- ----------- ----------- ----------- -----------
Expenses:
Investment adviser fee 2,103,351 3,185,116 2,356,482 1,507,843 1,322,706
Administrative personnel
and services fee 250,356 370,364 281,898 419,626 137,842
Custodian fees 57,567 77,415 62,996 87,126 33,068
Transfer and dividend
disbursing agent fees and
expenses 25,597 56,460 44,721 11,083 34,647
Trustees' fees 5,180 6,509 8,860 8,407 3,589
Auditing fees 15,520 14,955 15,245 15,165 14,899
Legal fees 5,185 8,784 10,684 8,436 4,236
Portfolio accounting fees 3,003 3,025 2,470 7,107 3,534
Distribution services
fee--Class B Shares 54,300 171,432 -- -- 940
Shareholder services
fee--Class A Shares 236,058 217,413 340,460 411,379 164,684
Shareholder services
fee--Class B Shares 18,100 57,144 -- -- 313
Share registration costs 41,905 153,695 27,951 52,279 37,484
Printing and postage 13,177 14,861 13,992 10,590 20,526
Insurance premiums 1,243 2,146 1,870 2,701 1,218
Miscellaneous 5,169 10,441 10,047 8,177 5,318
----------- ----------- ----------- ----------- -----------
Total expenses 2,835,711 4,349,760 3,177,676 2,549,919 1,785,004
----------- ----------- ----------- ----------- -----------
Waivers and
reimbursements--
Waiver of investment
adviser fee -- -- -- -- (3,432)
----------- ----------- ----------- ----------- -----------
Net expenses 2,835,711 4,349,760 3,177,676 2,549,919 1,781,572
----------- ----------- ----------- ----------- -----------
Net investment income 1,900,993 2,667,009 1,311,366 6,229,670 2,893,962
----------- ----------- ----------- ----------- -----------
Realized and Unrealized
Gain (Loss) on
Investments:
Net realized gain on
investments, futures
contracts and foreign
currency transactions 14,330,020 29,407,587 60,678,778 17,541,090 7,161,252
Net change in unrealized
appreciation
(depreciation) of
investments, futures
contracts and
translation of assets
and liabilities in
foreign currency 48,286,545 31,769,230 1,531,826 64,241,493 (1,650,644)
----------- ----------- ----------- ----------- -----------
Net realized and
unrealized gain (loss)
on investments,
futures contracts and
foreign currency 62,616,565 61,176,817 62,210,604 81,782,583 5,510,608
----------- ----------- ----------- ----------- -----------
Change in net assets
resulting from
operations $64,517,558 $63,843,826 $63,521,970 $88,012,253 $ 8,404,570
----------- ----------- ----------- ----------- -----------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds and The Wachovia Municipal Funds
Statements of Operations--Continued
Year Ended November 30, 1999
<TABLE>
<CAPTION>
Wachovia Wachovia Wachovia
Emerging Personal Wachovia Wachovia Intermediate
Markets Equity Balanced Fixed Fixed
Fund Fund(1) Fund Income Fund Income Fund
- --------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Investment Income:
Dividends $ 2,981,450* $ 1,334,495 $ 3,147,886 $ 1,351,671 $ 339,693
Interest 269,832 406,438 12,899,497 21,605,090 6,224,225
----------- ----------- ----------- ----------- -----------
Total income 3,251,282 1,740,933 16,047,383 22,956,761 6,563,918
----------- ----------- ----------- ----------- -----------
Expenses:
Investment adviser fee 1,655,474 990,713 3,422,031 2,163,987 635,402
Administrative personnel
and services fee 137,802 104,036 402,347 291,783 86,913
Custodian fees 313,931 25,760 83,589 65,590 21,180
Transfer and dividend
disbursing agent fees
and expenses 36,847 11,000 18,331 17,629 14,772
Trustees' fees 4,874 3,500 7,652 6,342 2,110
Auditing fees 15,968 15,000 14,867 15,121 14,864
Legal fees 9,115 2,000 9,308 10,090 4,311
Portfolio accounting
fees 8,191 500 9,641 13,194 1,235
Distribution services
fee--Class B Shares -- -- 134,080 5,854 --
Shareholder services
fee--Class A Shares 33,617 16 480,755 139,078 9,931
Shareholder services
fee--Class B Shares -- -- 44,693 1,951 --
Share registration costs 32,014 125,922 97,685 99,016 24,139
Printing and postage 15,223 5,000 11,456 14,264 15,279
Insurance premiums 2,382 4,500 3,014 1,310 1,027
Miscellaneous 4,182 5,000 13,399 8,068 4,302
----------- ----------- ----------- ----------- -----------
Total expenses 2,269,620 1,292,947 4,752,848 2,853,277 835,465
----------- ----------- ----------- ----------- -----------
Waivers and
reimbursements--
Waiver of investment
adviser fee -- (15,909) (372,597) (110,201) (42,003)
----------- ----------- ----------- ----------- -----------
Net expenses 2,269,620 1,277,038 4,380,251 2,743,076 793,462
----------- ----------- ----------- ----------- -----------
Net investment income 981,662 463,895 11,667,132 20,213,685 5,770,456
----------- ----------- ----------- ----------- -----------
Realized and Unrealized
Gain (Loss) on
Investments:
Net realized gain (loss)
on investments, futures
contracts and foreign
currency transactions 2,891,987** 7,806,983 21,074,744 (1,975,659) 35,200
Net change in unrealized
appreciation
(depreciation) of
investments, futures
contracts and
translation of assets
and liabilities in
foreign currency 52,585,006 20,381,700 37,368,946 (16,216,784) (5,768,480)
----------- ----------- ----------- ----------- -----------
Net realized and
unrealized gain (loss)
on investments,
futures contracts and
foreign currency 55,476,993 28,188,683 58,443,690 (18,192,443) (5,733,280)
----------- ----------- ----------- ----------- -----------
Change in net assets
resulting from
operations $56,458,655 $28,652,578 $70,110,822 $ 2,021,242 $ 37,176
----------- ----------- ----------- ----------- -----------
</TABLE>
*Net of foreign taxes withheld of $221,723.
**Net of foreign capital gain taxes of $243,267.
(1)Reflects operations for the period from July 30, 1999 (date of initial public
investment) to November 30, 1999.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Wachovia Funds and The Wachovia Municipal Funds
Statements of Operations--Continued
Year Ended November 30, 1999
<TABLE>
<CAPTION>
Wachovia Wachovia
Wachovia Wachovia North South Wachovia
Short Term Georgia Carolina Carolina Virginia
Fixed Municipal Municipal Municipal Municipal
Income Fund Bond Fund Bond Fund Bond Fund Bond Fund
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Investment Income:
Dividends $ 82,738 $ -- $ -- $ -- $ --
Interest 3,236,702 2,837,197 9,635,223 10,846,610 6,259,975
----------- ----------- ------------ ------------ -----------
Total income 3,319,440 2,837,197 9,635,223 10,846,610 6,259,975
----------- ----------- ------------ ------------ -----------
Expenses:
Investment adviser fee 310,181 415,853 1,466,791 1,507,188 876,247
Administrative personnel
and services fee 47,798 43,476 151,115 160,810 98,127
Custodian fees 11,279 11,089 35,897 38,504 23,682
Transfer and dividend
disbursing agent fees and
expenses 6,534 11,891 18,169 8,773 15,611
Trustees' fees 2,607 2,386 2,677 2,960 2,987
Auditing fees 15,099 15,394 15,245 15,022 13,368
Legal fees 6,010 5,777 5,138 5,917 5,203
Portfolio accounting fees 3,019 9,316 17,834 15,110 12,793
Shareholder services
fee--Class A Shares 25,565 15,941 23,325 162,729 21,071
Share registration costs 15,451 45,425 115,004 86,928 31,895
Printing and postage 10,816 11,275 18,712 26,018 24,825
Insurance premiums 1,049 1,000 891 1,120 833
Miscellaneous 4,175 11,283 16,542 4,980 6,347
----------- ----------- ------------ ------------ -----------
Total expenses 459,583 600,106 1,887,340 2,036,059 1,132,989
----------- ----------- ------------ ------------ -----------
Waivers and
reimbursements--
Waiver of investment
adviser fee (78,764) (198,440) (568,554) (709,176) (344,472)
----------- ----------- ------------ ------------ -----------
Net expenses 380,819 401,666 1,318,786 1,326,883 788,517
----------- ----------- ------------ ------------ -----------
Net investment income 2,938,621 2,435,531 8,316,437 9,519,727 5,471,458
----------- ----------- ------------ ------------ -----------
Realized and Unrealized
Gain (Loss) on
Investments:
Net realized gain (loss)
on investments, futures
contracts and foreign
currency transactions 491,231 (561,411) 263,247 64,300 169,324
Net change in unrealized
appreciation
(depreciation) of
investments, futures
contracts and
translation of assets
and liabilities in
foreign currency (1,634,947) (3,747,837) (13,454,369) (15,832,915) (7,994,414)
----------- ----------- ------------ ------------ -----------
Net realized and
unrealized gain (loss)
on investments,
futures contracts and
foreign currency (1,143,716) (4,309,248) (13,191,122) (15,768,615) (7,825,090)
----------- ----------- ------------ ------------ -----------
Change in net assets
resulting from
operations $ 1,794,905 $(1,873,717) $ (4,874,685) $ (6,248,888) $(2,353,632)
----------- ----------- ------------ ------------ -----------
</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
Equity Fund Quantitative Equity Fund Growth & Income Fund
-------------------------------------------------------------------------------------
Year Year Year Year Year Year
Ended Ended Ended Ended Ended Ended
November 30, November 30, November 30, November 30, November 30, November 30,
1999 1998 1999 1998 1999 1998
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Increase (Decrease) in
Net Assets:
Operations--
Net investment income $ 1,900,993 $ 2,562,164 $ 2,667,009 $ 3,010,939 $ 1,311,366 $ 2,327,051
Net realized gain
(loss) on investments
and futures contracts 14,330,020 25,423,254 29,407,587 8,106,935 60,678,778 39,310,322
Net change in
unrealized
appreciation
(depreciation) of
investments and
futures contracts 48,286,545 9,686,441 31,769,230 34,370,766 1,531,826 20,725,093
------------ ------------ ------------ ------------ ------------ ------------
Change in net assets
resulting from
operations 64,517,558 37,671,859 63,843,826 45,488,640 63,521,970 62,362,466
------------ ------------ ------------ ------------ ------------ ------------
Distributions to
Shareholders--
Distributions from net
investment income
Class A Shares (362,278) (434,085) (504,434) (550,325) (456,714) (1,096,382)
Class B Shares (293) (9,956) (10,684) (38,995) -- --
Class Y Shares (1,373,680) (2,078,302) (2,379,853) (2,433,040) (1,160,298) (847,829)
Distributions from net
realized gain on
investments and
futures contracts
Class A Shares (6,403,780) (4,382,604) (9,777,137) (3,354,334) (15,960,065) (16,598,781)
Class B Shares (682,925) (386,343) (2,553,864) (633,226) -- --
Class Y Shares (23,092,487) (17,186,819) (25,353,209) (16,891,130) (25,242,279) --
------------ ------------ ------------ ------------ ------------ ------------
Change in net assets
from distributions to
shareholders (31,915,443) (24,478,109) (40,579,181) (23,901,050) (42,819,356) (18,542,992)
------------ ------------ ------------ ------------ ------------ ------------
Share Transactions--
Proceeds from sale of
shares 126,213,398 79,804,293 45,216,048 85,542,784 79,304,120 228,486,710
Proceeds from shares
issued in connection
with the tax-free
transfer of assets
from a Common Trust
Fund -- -- 373,318,412 -- -- --
Net asset value of
shares issued
to shareholders in
payment of dividends
declared 24,618,584 18,768,160 36,090,601 21,884,659 20,328,598 9,768,460
Cost of shares redeemed (90,750,849) (51,792,656) (75,233,898) (44,449,005) (107,223,683) (284,316,544)
------------ ------------ ------------ ------------ ------------ ------------
Change in net assets
from
share transactions 60,081,133 46,779,797 379,391,163 62,978,438 (7,590,965) (46,061,374)
------------ ------------ ------------ ------------ ------------ ------------
Change in net assets 92,683,248 59,973,547 402,655,808 84,566,028 13,111,649 (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 $351,836,262 $259,153,014 $712,212,696 $309,556,888 $349,593,378 $336,481,729
------------ ------------ ------------ ------------ ------------ ------------
Undistributed net
investment
income included in net
assets at end of period $ 349,608 $ 184,893 $ 94,763 $ 322,725 $ 192,896 $ 498,542
------------ ------------ ------------ ------------ ------------ ------------
Net gain as computed for
federal tax purposes $ 10,259,620 $ 29,886,669 $ 26,412,197 $ 11,277,361 $ 59,248,423 $ 41,201,605
------------ ------------ ------------ ------------ ------------ ------------
</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
Equity Index Fund Special Values Fund
---------------------------------------------------------
Year Year Year Year
Ended Ended Ended Ended
November 30, November 30, November 30, November 30,
1999 1998 1999 1998
- ---------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Increase (Decrease) in
Net Assets:
Operations--
Net investment income $ 6,229,670 $ 5,003,197 $ 2,893,962 $ 1,701,412
Net realized gain on
investments and
futures contracts 17,541,090 421,731 7,161,252 5,464,983
Net change in
unrealized
appreciation
(depreciation) of
investments
and futures contracts 64,241,493 68,214,882 (1,650,644) (15,392,292)
------------ ------------ ------------ ------------
Change in net assets
resulting from
operations 88,012,253 73,639,810 8,404,570 (8,225,897)
------------ ------------ ------------ ------------
Distributions to
Shareholders--
Distributions from net
investment income
Class A Shares (1,667,787) (945,159) (597,826) (273,707)
Class B Shares -- -- -- --
Class Y Shares (4,270,929) (3,814,497) (1,140,362) (656,635)
Distributions from net
realized gain on
investments and
futures contracts
Class A Shares (2,179,495) (1,188,632) (2,756,902) (3,883,188)
Class B Shares -- -- -- --
Class Y Shares (4,801,448) (5,186,506) (4,195,184) (7,685,327)
------------ ------------ ------------ ------------
Change in net assets
from distributions to
shareholders (12,919,659) (11,134,794) (8,690,274) (12,498,857)
------------ ------------ ------------ ------------
Share Transactions--
Proceeds from sale of
shares 148,792,010 134,592,835 55,734,701 70,849,082
Proceeds from shares
issued in connection
with the tax-free
transfer of assets
from a Common Trust
Fund -- -- 6,217,889 --
Net asset value of
shares issued to
shareholders in
payment of dividends
declared 12,226,266 10,713,271 7,362,549 11,067,462
Cost of shares redeemed (114,781,275) (83,275,340) (43,319,704) (33,500,251)
------------ ------------ ------------ ------------
Change in net assets
from share
transactions 46,237,001 62,030,766 25,995,435 48,416,293
------------ ------------ ------------ ------------
Change in net assets 121,329,595 124,535,782 25,709,731 27,691,539
Net Assets:
Beginning of period 423,301,756 298,765,974 149,957,852 122,266,313
------------ ------------ ------------ ------------
End of period $544,631,351 $423,301,756 $175,667,583 $149,957,852
------------ ------------ ------------ ------------
Undistributed net
investment income
included in net assets
at end of period $ 1,093,854 $ 802,900 $ 2,752,766 $ 1,564,491
------------ ------------ ------------ ------------
Net gain as computed for
federal tax purposes $ 11,284,463 $ 7,032,936 $ 5,879,628 $ 6,952,058
------------ ------------ ------------ ------------
</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 Personal Wachovia
Emerging Markets Fund Equity Fund Balanced Fund
-----------------------------------------------------------------------
Year Year Period Year Year
Ended Ended Ended Ended Ended
November 30, November 30, November 30, November 30, November 30,
1999 1998 1999(1) 1999 1998
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Increase (Decrease) in
Net Assets:
Operations--
Net investment income $ 981,662 $ 1,727,317 $ 463,895 $ 11,667,132 $ 11,937,638
Net realized gain
(loss) on investments,
futures contracts and
foreign currency
transactions 2,891,987 (26,904,345) 7,806,983 21,074,744 34,803,316
Net change in
unrealized
appreciation
(depreciation) of
investments, futures
contracts and
translation of assets
and liabilities in
foreign currency 52,585,006 (16,292,727) 20,381,700 37,368,946 5,465,835
------------ ------------ ------------ ------------ ------------
Change in net assets
resulting from
operations 56,458,655 (41,469,755) 28,652,578 70,110,822 52,206,789
------------ ------------ ------------ ------------ ------------
Distributions to
Shareholders--
Distributions from net
investment income
Class A Shares (48,950) (79,885) -- (4,340,110) (2,395,836)
Class B Shares -- -- -- (276,558) (210,069)
Class Y Shares (1,079,581) (1,627,997) (212,600) (6,781,441) (9,025,669)
Distributions from net
realized gain on
investments, futures
contracts and foreign
currency
Class A Shares -- -- -- (17,377,408) (3,838,968)
Class B Shares -- -- -- (1,929,181) (425,121)
Class Y Shares -- -- -- (32,938,534) (16,816,255)
------------ ------------ ------------ ------------ ------------
Change in net assets
from distributions to
shareholders (1,128,531) (1,707,882) (212,600) (63,643,232) (32,711,918)
------------ ------------ ------------ ------------ ------------
Share Transactions--
Proceeds from sale of
shares 35,132,998 59,662,218 2,244,187 216,793,701 167,115,147
Proceeds from shares
issued in connection
with the tax-free
transfer of assets
from a Common Trust
Fund -- -- 428,394,696 249,842,105 --
Net asset value of
shares issued to
shareholders in
payment of dividends
declared 384,631 616,589 63 57,849,606 30,283,351
Cost of shares redeemed (35,972,883) (25,222,374) (14,516,568) (304,243,599) (99,971,459)
------------ ------------ ------------ ------------ ------------
Change in net assets
from
share transactions (455,254) 35,056,433 416,122,378 220,241,813 97,427,039
------------ ------------ ------------ ------------ ------------
Change in net assets 54,874,870 (8,121,204) 444,562,356 226,709,403 116,921,910
Net Assets:
Beginning of period 139,574,958 147,696,162 -- 423,889,391 306,967,481
------------ ------------ ------------ ------------ ------------
End of period $194,449,828 $139,574,958 $444,562,356 $650,598,794 $423,889,391
------------ ------------ ------------ ------------ ------------
Undistributed net
investment
income included in net
assets at end of period $ 1,380,168 $ 861,148 $ 251,295 $ 2,059,503 $ 1,790,481
------------ ------------ ------------ ------------ ------------
Net gain (loss) as
computed for
federal tax purposes $ 2,465,582 $(25,282,206) $ 8,014,524 $ 17,205,726 $ 39,461,216
------------ ------------ ------------ ------------ ------------
</TABLE>
(1) Reflects operations for the period from July 30, 1999 (date of initial
public investment) to November 30, 1999.
(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 Short-
Fixed Income Fund Intermediate Fixed Income Fund Term Fixed Income Fund
-------------------------------------------------------------------------------------------
Year Year Year Year Year Year
Ended Ended Ended Ended Ended Ended
November 30, November 30, November 30, November 30, November 30, November 30,
1999 1998 1999 1998 1999 1998
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Increase (Decrease) in
Net Assets:
Operations--
Net investment income $ 20,213,685 $ 12,119,208 $ 5,770,456 $ 5,108,991 $ 2,938,621 $ 5,662,695
Net realized gain
(loss) on investments
and futures contracts (1,975,659) 3,568,877 35,200 4,965,732 491,231 536,985
Net change in
unrealized
appreciation
(depreciation) of
investments and
futures contracts (16,216,784) 2,972,507 (5,768,480) (1,521,439) (1,634,947) 920,118
------------- ------------ -------------- --------------- ------------ ------------
Change in net assets
resulting from
operations 2,021,242 18,660,592 37,176 8,553,284 1,794,905 7,119,798
------------- ------------ -------------- --------------- ------------ ------------
Distributions to
Shareholders--
Distributions from net
investment income
Class A Shares (2,884,514) (940,460) (202,679) (2,130,033) (547,972) (502,454)
Class B Shares (35,054) (16,381) -- -- -- --
Class Y Shares (16,617,132) (11,358,420) (5,512,076) (3,157,720) (2,779,470) (5,081,639)
Distributions from net
realized gain on
investments and
futures contracts
Class A Shares (111,279) -- (92,062) -- -- --
Class B Shares (2,141) -- -- -- -- --
Class Y Shares (741,696) -- (1,701,330) -- -- --
------------- ------------ -------------- --------------- ------------ ------------
Change in net assets
from distributions to
shareholders (20,391,816) (12,315,261) (7,508,147) (5,287,753) (3,327,442) (5,584,093)
------------- ------------ -------------- --------------- ------------ ------------
Share Transactions--
Proceeds from sale of
shares 165,467,506 81,647,518 20,483,149 99,110,496 13,979,811 28,878,718
Proceeds from shares
issued in connection
with the tax-free
transfer of assets
from a Common Trust
Fund 265,851,176 -- 59,122,769 -- 7,116,836 --
Net asset value of
shares issued to
shareholders in
payment of
distributions declared 9,617,907 7,498,622 651,094 592,995 2,803,311 5,384,024
Cost of shares redeemed (102,333,202) (53,025,914) (23,663,167) (107,004,830) (82,504,658) (25,225,385)
------------- ------------ -------------- --------------- ------------ ------------
Change in net assets
from share
transactions 338,603,387 36,120,226 56,593,845 (7,301,339) (58,604,700) 9,037,357
------------- ------------ -------------- --------------- ------------ ------------
Change in net assets 320,232,813 42,465,557 49,122,874 (4,035,808) (60,137,237) 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 $ 558,275,832 $238,043,019 $ 141,712,691 $ 92,589,817 $ 48,732,245 $108,869,482
------------- ------------ -------------- --------------- ------------ ------------
Undistributed net
investment income
included in net assets
at
end of period $ 592,886 $ -- $ 117,569 $ 61,868 $ 134,880 $ 523,701
------------- ------------ -------------- --------------- ------------ ------------
Net gain (loss) as
computed for federal
tax purposes $ (2,177,586) $ 3,793,537 $ 79,785 $ 4,972,877 $ 491,231 $ 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
Georgia Municipal North Carolina Municipal
Bond Fund Bond Fund
-------------------------------------------------------
Year Year Year Year
Ended Ended Ended Ended
November 30, November 30, November 30, November 30,
1999 1998 1999 1998
- ---------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Increase (Decrease) in
Net Assets:
Operations--
Net investment income $ 2,435,531 $ 825,254 $ 8,316,437 $ 2,437,336
Net realized gain (loss)
on investments (561,411) 61,857 263,247 327,825
Net change in unrealized
appreciation
(depreciation)
of investments (3,747,837) 428,018 (13,454,369) 1,360,515
------------ ----------- ------------ -----------
Change in net assets
resulting from
operations (1,873,717) 1,315,129 (4,874,685) 4,125,676
------------ ----------- ------------ -----------
Distributions to
Shareholders--
Distributions from net
investment income
Class A Shares (245,913) (251,879) (354,496) (393,274)
Class Y Shares (2,174,539) (573,430) (7,981,753) (2,044,014)
Distributions from net
realized gain on
investments
Class A Shares (17,469) (2,076) (47,957) (6,494)
Class Y Shares (43,655) (3,949) (279,986) (25,032)
------------ ----------- ------------ -----------
Change in net assets
from distributions to
shareholders (2,481,576) (831,334) (8,664,192) (2,468,814)
------------ ----------- ------------ -----------
Share Transactions--
Proceeds from sale of
shares 13,513,690 6,541,536 40,895,769 17,216,738
Proceeds from shares
issued in connection
with the tax-free
transfer of assets from
a Common Trust Fund 88,191,199 -- 366,043,958 --
Net asset value of
shares issued to
shareholders in
payment of distributions
declared 290,940 271,955 717,052 527,425
Cost of shares redeemed (7,365,394) (2,205,784) (17,244,173) (8,774,593)
------------ ----------- ------------ -----------
Change in net assets
from share
transactions 94,630,435 4,607,707 390,412,606 8,969,570
------------ ----------- ------------ -----------
Change in net assets 90,275,142 5,091,502 376,873,729 10,626,432
Net Assets:
Beginning of period 23,930,409 18,838,907 66,293,759 55,667,327
------------ ----------- ------------ -----------
End of period $114,205,551 $23,930,409 $443,167,488 $66,293,759
------------ ----------- ------------ -----------
Undistributed net
investment income
included in net assets
at end of period $ 15,576 $ 497 $ 28,577 $ 48
------------ ----------- ------------ -----------
Net gain (loss) as
computed for federal tax
purposes $ (575,481) $ 61,164 $ 257,307 $ 327,826
------------ ----------- ------------ -----------
</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
South Carolina Municipal Virginia Municipal
Bond Fund Bond Fund
-----------------------------------------------------------
Year Year Year Year
Ended Ended Ended Ended
November 30, November 30, November 30, November 30,
1999 1998 1999 1998
- ---------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Increase (Decrease) in
Net Assets:
Operations--
Net investment income $ 9,519,727 $ 5,366,704 $ 5,471,458 $ 4,906,389
Net realized gain on
investments 64,300 209,185 169,324 723,926
Net change in
unrealized
appreciation
(depreciation)
of investments (15,832,915) 2,123,645 (7,994,414) 1,656,976
------------ ------------ ------------ -------------
Change in net assets
resulting from
operations (6,248,888) 7,699,534 (2,353,632) 7,287,291
------------ ------------ ------------ -------------
Distributions to
Shareholders--
Distributions from net
investment income
Class A Shares (2,932,843) (2,984,948) (366,695) (2,135,085)
Class Y Shares (6,591,278) (2,379,402) (5,090,199) (3,026,800)
Distributions from net
realized gain on
investments
Class A Shares (116,632) (5,753) -- --
Class Y Shares (92,877) (4,021) -- --
------------ ------------ ------------ -------------
Change in net assets
from distributions to
shareholders (9,733,630) (5,374,124) (5,456,894) (5,161,885)
------------ ------------ ------------ -------------
Share Transactions--
Proceeds from sale of
shares 37,278,910 23,937,897 26,296,082 110,194,596
Proceeds from shares
issued in connection
with the tax-free
transfer of assets
from a Common Trust
Fund 225,809,305 -- 32,818,769 --
Net asset value of
shares issued to
shareholders in
payment
of distributions
declared 2,188,807 2,037,672 555,659 341,749
Cost of shares redeemed (23,066,610) (14,650,172) (22,355,749) (115,832,370)
------------ ------------ ------------ -------------
Change in net assets
from share
transactions 242,210,412 11,325,397 37,314,761 (5,296,025)
------------ ------------ ------------ -------------
Change in net assets 226,227,894 13,650,807 29,504,235 (3,170,619)
Net Assets:
Beginning of period 122,227,717 108,576,910 107,989,354 111,159,973
------------ ------------ ------------ -------------
End of period $348,455,611 $122,227,717 $137,493,589 $ 107,989,354
------------ ------------ ------------ -------------
Undistributed net
investment income
included in net assets
at end of period $ (1,386) $ 3,008 $ 7,307 $ (7,257)
------------ ------------ ------------ -------------
Net gain (loss) as
computed for federal
tax purposes $ 64,300 $ 207,167 $ 169,324 $ 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>
Distributions
from Net
Net Realized and Realized Gain on
Net Asset Unrealized Gain/(Loss) on Distributions Investment Transactions and
Value, Net Investments and Futures Total from from Net Futures Contracts
Year Ended beginning Investment Contracts, and Foreign Investment Investment and
Foreign Total
November 30, of period Income Currency Transactions Operations Income Currency Transactions
Distributions
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
<C>
Wachovia Equity Fund
1995 $10.32 0.23 2.64 2.87 (0.25)
(0.23) (0.48)
1996 $12.71 0.22(4) 2.83 3.05 (0.22)
(0.73) (0.95)
1997 $14.81 0.14(4) 2.43 2.57 (0.13)
(1.86) (1.99)
1998 $15.39 0.13(4) 2.21 2.34 (0.14)
(1.68) (1.82)
1999 $15.91 0.06 3.41 3.47 (0.07)
(1.89) (1.96)
Wachovia Quantitative Equity Fund
1995 $ 9.60 0.22 3.51 3.73 (0.22)
- -- (0.22)
1996 $13.11 0.24(4) 2.77 3.01 (0.21)
(0.24) (0.45)
1997 $15.67 0.18(4) 4.14 4.32 (0.20)
(0.79) (0.99)
1998 $19.00 0.11(4) 3.12 3.23 (0.19)
(1.75) (1.94)
1999 $20.29 0.09 3.16 3.25 (0.12)
(2.42) (2.54)
Wachovia Growth & Income Fund
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 $23.54 0.05 4.24 4.29 (0.08)
(2.89) (2.97)
Wachovia Equity Index Fund
1995 $10.27 0.28 3.37 3.65 (0.27)
(0.03) (0.30)
1996 $13.62 0.32(4) 3.13 3.45 (0.31)
(0.78) (1.09)
1997 $15.98 0.25(4) 3.85 4.10 (0.28)
(0.91) (1.19)
1998 $18.89 0.26(4) 3.90 4.16 (0.24)
(0.40) (0.64)
1999 $22.41 0.27 4.13 4.40 (0.26)
(0.37) (0.63)
Wachovia Special Values Fund
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(4) 4.53 4.66 (0.08)
(1.61) (1.69)
1998 $18.64 0.19(4) (0.87) (0.68) (0.12)
(1.71) (1.83)
1999 $16.13 0.25 0.56 0.81 (0.16)
(0.75) (0.91)
Wachovia Emerging Markets Fund
1995(1) $10.00 0.05 0.36 0.41 --
- -- --
1996 $10.41 0.09(4) 1.20 1.29 (0.03)
- -- (0.03)
1997 $11.67 0.03(4) (0.47) (0.44) (0.11)
- -- (0.11)
1998 $11.12 0.09(4) (2.68) (2.59) (0.10)
- -- (0.10)
1999 $ 8.43 0.04(4) 3.32 3.36 (0.05)
- -- (0.05)
Wachovia Personal Equity Fund
1999(6) $10.00 0.01 0.67 0.68 (0.01)
- -- (0.01)
</TABLE>
(1) Reflects operations for the period from December 26, 1994 (date of initial
public investment) to November 30, 1995.
(2) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.
(3) This contractual expense decrease is reflected in both the expense and net
investment income ratios.
(4) Per share information is based on average shares outstanding. (5) Computed
on an annualized basis. (6) Reflects operations for the period from July 30,
1999 (date of initial
public investment) to November 30, 1999.
(7) Less then 0.01%.
(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>
Ratios to Average Net Assets
---------------------------------------
Net Asset Net Net Assets, Portfolio
Year Ended Value, end Total Investment Expense Waiver/ end of period Turnover
November 30, of period Return(2) Expenses Income Reimbursement(3) (000 omitted) Rate
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Wachovia Equity Fund
1995 $12.71 28.74% 0.90% 1.99% 0.07% $130,150 65%
1996 $14.81 25.56% 0.90% 1.62% 0.15% $ 20,774 64%
1997 $15.39 20.22% 1.14% 0.95% 0.07% $ 39,494 124%
1998 $15.91 17.34% 1.12% 0.91% -- $ 53,103 150%
1999 $17.42 24.31% 1.09% 0.49% -- $118,967 45%
Wachovia Quantitative
Equity Fund
1995 $13.11 39.33% 0.87% 1.93% 0.10% $121,895 63%
1996 $15.67 23.74% 0.87% 1.70% 0.15% $ 15,742 44%
1997 $19.00 29.38% 1.11% 1.09% 0.07% $ 35,413 74%
1998 $20.29 18.98% 1.11% 0.95% -- $ 82,682 38%
1999 $21.00 16.60% 1.11% 0.48% -- $ 89,140 34%
Wachovia Growth &
Income Fund
1995 $12.88 33.59% 1.35% 1.58% 0.36% $119,484 30%
1996 $16.41 30.10% 1.35% 1.04% 0.31% $186,147 12%
1997 $20.60 28.50% 1.30% 0.70% 0.30% $338,724 13%
1998 $23.54 20.77% 1.21% 0.59% 0.08% $130,306 24%
1999 $24.86 20.40% 1.09% 0.24% -- $ 94,674 44%
Wachovia Equity Index
Fund
1995 $13.62 36.15% 0.48% 2.39% 0.05% $186,841 60%
1996 $15.98 27.19% 0.48% 2.23% 0.13% $ 18,154 12%
1997 $18.89 27.55% 0.72% 1.46% 0.02% $ 50,917 4%
1998 $22.41 22.74% 0.70% 1.23% -- $131,594 29%
1999 $26.18 19.97% 0.69% 1.07% -- $182,697 11%
Wachovia Special Values
Fund
1995 $12.18 25.91% 1.29% 0.80% 0.58% $ 24,093 57%
1996 $15.67 39.78% 1.21% 0.47% 0.29% $ 6,642 38%
1997 $18.64 33.08% 1.35% 0.74% 0.01% $ 37,766 46%
1998 $16.13 (3.86%) 1.25% 0.98% -- $ 59,408 20%
1999 $16.03 5.40% 1.23% 1.61% 0.00%(7) $ 65,348 44%
Wachovia Emerging
Markets Fund
1995(1) $10.41 4.10% 1.80%(5) 0.85%(5) 0.28%(5) $ 71,276 17%
1996 $11.67 12.45% 1.69% 0.73% 0.09% $ 5,488 30%
1997 $11.12 (3.82%) 1.79% 0.26% -- $ 7,996 60%
1998 $ 8.43 (23.46%) 1.68% 0.90% -- $ 8,677 51%
1999 $11.74 40.07% 1.60% 0.37% -- $ 16,007 56%
Wachovia Personal
Equity Fund
1999(6) $10.67 6.75% 1.15%(5) 0.39%(5) 0.01%(5) $ 110 11%
</TABLE>
(1) Reflects operations for the period from December 26, 1994 (date of initial
public investment) to November 30, 1995.
(2) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.
(3) This contractual expense decrease is reflected in both the expense and net
investment income ratios.
(4) Per share information is based on average shares outstanding. (5) Computed
on an annualized basis. (6) Reflects operations for the period from July 30,
1999 (date of initial
public investment) to November 30, 1999.
(7) Less than 0.01%.
(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>
Distributions
Net Asset Net Realized and Distributions from Net
Value, Net Unrealized Gain/(Loss) Total from from Net Realized Gain on
Year Ended beginning Investment on Investments Investment Investment Investment Transaction
Total
November 30, of period Income and Futures Contracts Operations Income and Futures Contracts
Distributions
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Wachovia Balanced Fund
1995 $ 9.93 0.40 2.13 2.53 (0.38) (0.16)
(0.54)
1996 $11.92 0.38(4) 1.72 2.10 (0.38) (0.34)
(0.72)
1997 $13.30 0.34(4) 1.40 1.74 (0.34) (1.44)
(1.78)
1998 $13.26 0.24(4) 1.50 1.74 (0.38) (0.90)
(1.28)
1999 $13.72 0.29 1.44 1.73 (0.31) (1.69)
(2.00)
Wachovia Fixed Income Fund
1995 $ 8.97 0.58 0.92 1.50 (0.57) --
(0.57)
1996 $ 9.90 0.61(4) (0.09) 0.52 (0.59) --
(0.59)
1997 $ 9.83 0.54(4) 0.04 0.58 (0.56) --
(0.56)
1998 $ 9.85 0.53(4) 0.30 0.83 (0.54) --
(0.54)
1999 $10.14 0.51 (0.58) (0.07) (0.51) (0.04)
(0.55)
Wachovia Intermediate Fixed
Income Fund
1995 $ 9.31 0.55 0.76 1.31 (0.55) --
(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 $10.38 0.50 (0.61) (0.11) (0.50) (0.20)
(0.70)
Wachovia Short-Term Fixed Income
Fund
1995 $ 9.58 0.59 0.24 0.83 (0.52) --
(0.52)
1996 $ 9.89 0.56(4) (0.06) 0.50 (0.60) --
(0.60)
1997 $ 9.79 0.50(4) (0.01) 0.49 (0.51) --
(0.51)
1998 $ 9.77 0.52(4) 0.14 0.66 (0.51) --
(0.51)
1999 $ 9.92 0.48 (0.25) 0.23 (0.52) --
(0.52)
Wachovia Georgia Municipal Bond
Fund
1995(1) $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)(6)
(0.42)
1999 $11.38 0.43 (0.74) (0.31) (0.43) (0.03)
(0.46)
Wachovia North Carolina Municipal Bond Fund
1995(1) $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 $11.46 0.42 (0.68) (0.26) (0.42) (0.06)
(0.48)
Wachovia South Carolina Municipal Bond Fund
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)(6)
(0.51)
1999 $11.36 0.50 (0.77) (0.27) (0.50) (0.02)
(0.52)
Wachovia Virginia Municipal Bond
Fund
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 $10.49 0.45 (0.65) (0.20) (0.45) --
(0.45)
</TABLE>
(1) Reflects operations for the period from December 26, 1994 (date of initial
public investment) to November 30, 1995.
(2) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.
(3) This contractual expense decrease is reflected in both the expense and net
investment income ratios.
(4) Per share information is based on average shares outstanding. (5) Computed
on an annualized basis.
(6) 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
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Ratios to Average Net Assets
---------------------------------------
Net Asset Net Net Assets, Portfolio
Year Ended Value, end Total Investment Expense Waiver/ end of period Turnover
November 30, of period Return(2) Expenses Income Reimbursement(3) (000 omitted) Rate
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Wachovia Balanced Fund
1995 $11.92 26.32% 0.76% 3.58% 0.16% $207,421 102%
1996 $13.30 18.55% 0.76% 3.05% 0.24% $ 18,619 99%
1997 $13.26 15.17% 1.02% 2.77% 0.16% $ 50,968 143%
1998 $13.72 14.36% 1.01% 2.88% 0.09% $119,093 124%
1999 $13.45 13.95% 1.01% 2.26% 0.08% $205,167 66%
Wachovia Fixed Income
Fund
1995 $ 9.90 17.20% 0.74% 6.07% 0.10% $169,846 155%
1996 $ 9.83 5.51% 0.74% 6.05% 0.18% $ 4,853 181%
1997 $ 9.85 6.14% 0.98% 5.65% 0.11% $ 10,039 174%
1998 $10.14 8.65% 0.97% 5.30% 0.05% $ 24,624 111%
1999 $ 9.52 (0.77)% 0.97% 5.34% 0.03% $ 69,475 49%
Wachovia Intermediate
Fixed Income Fund
1995 $10.07 14.44% 1.10% 5.60% 0.41% $ 35,796 44%
1996 $ 9.96 4.46% 1.09% 5.62% 0.31% $ 43,277 84%
1997 $10.03 6.32% 1.04% 5.50% 0.30% $ 96,626 81%
1998 $10.38 9.39% 1.06% 5.39% 0.14% $ 4,759 57%
1999 $ 9.57 (1.03)% 0.99% 5.16% 0.04% $ 3,205 89%
Wachovia Short-Term
Fixed Income Fund
1995 $ 9.89 8.82% 0.63% 5.83% 0.18% $124,720 147%
1996 $ 9.79 5.29% 0.63% 5.50% 0.27% $ 1,675 145%
1997 $ 9.77 5.10% 0.87% 5.49% 0.19% $ 7,233 215%
1998 $ 9.92 6.93% 0.88% 5.22% 0.10% $ 10,437 135%
1999 $ 9.63 2.44% 0.88% 4.97% 0.14% $ 10,409 25%
Wachovia Georgia
Municipal Bond Fund
1995(1) $10.96 13.93% 0.92%(5) 4.30%(5) 1.88%(5) $ 10,220 14%
1996 $11.00 4.97% 0.89% 4.40% 1.61% $ 7,531 14%
1997 $11.11 5.41% 1.14% 4.03% 1.11% $ 6,531 25%
1998 $11.38 6.35% 1.17% 3.72% 0.34% $ 6,900 14%
1999 $10.61 (2.83)% 1.07% 3.87% 0.30% $ 5,450 48%
Wachovia North Carolina Municipal
Bond Fund
1995(1) $10.99 14.40% 0.85%(5) 4.40%(5) 1.19%(5) $ 18,679 19%
1996 $11.03 5.17% 0.84% 4.24% 0.77% $ 13,752 7%
1997 $11.15 5.36% 1.07% 3.91% 0.44% $ 11,563 17%
1998 $11.46 6.82% 1.10% 3.80% 0.16% $ 9,533 9%
1999 $10.72 (2.34)% 1.02% 3.73% 0.20% $ 8,644 11%
Wachovia South Carolina Municipal
Bond Fund
1995 $11.05 16.97% 0.58% 5.23% 0.55% $ 93,725 15%
1996 $11.05 5.54% 0.57% 5.10% 0.59% $ 65,981 20%
1997 $11.12 6.01% 0.81% 4.79% 0.48% $ 64,696 12%
1998 $11.36 6.88% 0.83% 4.52% 0.36% $ 67,458 6%
1999 $10.57 (2.49)% 0.83% 4.50% 0.35% $ 59,655 9%
Wachovia Virginia
Municipal Bond Fund
1995 $10.25 13.79% 1.05% 4.33% 0.46% $ 54,041 78%
1996 $10.15 3.50% 1.04% 4.45% 0.40% $ 70,378 37%
1997 $10.30 5.97% 0.96% 4.50% 0.40% $111,160 15%
1998 $10.49 6.76% 0.95% 4.35% 0.33% $ 8,835 15%
1999 $ 9.84 (2.01)% 0.90% 4.36% 0.29% $ 7,682 29%
</TABLE>
(1) Reflects operations for the period from December 26, 1994 (date of initial
public investment) to November 30, 1995.
(2) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.
(3) This contractual expense decrease is reflected in both the expense and net
investment income ratios.
(4) Per share information is based on average shares outstanding. (5) Computed
on an annualized basis.
(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 The period)
<TABLE>
<CAPTION>
Net Realized and Distributions
Unrealized Gain/ from Net
Net Asset (Loss) on Total Distributions Realized Gain
Value, Net Investment from from Net on Investment
Year Ended beginning Investment and Futures Investment Investment Transaction and Total
November 30, of period Income/(Loss) Contracts Operations Income Futures Contracts 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 $15.87 (0.04) 3.38 3.34 (0.00)(3) (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 $20.23 (0.05) 3.16 3.11 (0.01) (2.42) (2.43)
Wachovia Special Values Fund
1999(5) $14.60 0.17 1.22 1.39 -- -- --
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 $13.69 0.20 1.42 1.62 (0.21) (1.69) (1.90)
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 $10.14 0.43 (0.58) (0.15) (0.43) (0.04) (0.47)
</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.
(3) Less than $0.01 per share. (4) Computed on an annualized basis.
(5) Reflects operations for the period from March 26, 1999 (date of initial
public investment) to November 30, 1999.
(6) This contractual expense decrease is reflected in both the expense and net
investment income ratios.
(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 the period)
<TABLE>
<CAPTION>
Ratios to Average Net Assets
-----------------------------------------
Net Asset Net Expense Net Assets, Portfolio
Year Ended Value, end Total Investment Waiver/ end of period Turnover
November 30, of period Return(2) Expenses Income/(Loss) Reimbursement(6) (000 omitted) Rate
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Wachovia Equity Fund
1996(1) $14.79 19.25% 1.90%(4) 0.02%(4) 0.20%(4) $ 976 64%
1997 $15.35 19.27% 1.90% 0.18% 0.06% $ 3,448 124%
1998 $15.87 16.52% 1.87% 0.17% -- $ 5,725 150%
1999 $17.32 23.37% 1.84% (0.26)% -- $ 8,992 45%
Wachovia Quantitative Equity Fund
1996(1) $15.65 19.90% 1.87%(4) 0.46%(4) 0.11%(4) $ 1,414 44%
1997 $18.95 28.33% 1.85% 0.31% 0.07% $ 6,564 74%
1998 $20.23 18.15% 1.86% 0.20% -- $19,532 38%
1999 $20.91 15.85% 1.86% (0.27)% -- $24,652 34%
Wachovia Special Values Fund
1999(5) $15.99 9.52% 1.98%(4) 0.93%(4) 0.01%(4) $ 350 44%
Wachovia Balanced Fund
1996(1) $13.29 14.47% 1.76%(4) 1.93%(4) 0.16%(4) $ 1,821 99%
1997 $13.23 14.19% 1.78% 2.01% 0.16% $ 5,916 143%
1998 $13.69 13.56% 1.76% 2.13% 0.09% $13,963 124%
1999 $13.41 13.08% 1.76% 1.50% 0.08% $20,927 66%
Wachovia Fixed Income Fund
1996(1) $ 9.83 5.83% 1.74%(4) 5.20%(4) 0.13%(4) $ 113 181%
1997 $ 9.84 5.21% 1.75% 4.89% 0.11% $ 140 174%
1998 $10.14 7.97% 1.72% 4.55% 0.05% $ 533 111%
1999 $ 9.52 (1.51)% 1.72% 4.57% 0.03% $ 819 49%
</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.
(3) Less than $0.01 per share. (4) Computed on an annualized basis.
(5) Reflects operations for the period from March 26, 1999 (date of initial
public investment) to November 30, 1999.
(6) This contractual expense decrease is reflected in both the expense and net
investment income ratios.
(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>
Distributions
Net Realized and from Net
Net Asset Unrealized Gain/(Loss) on Distributions Realized Gain on
Value Net Investments, Futures Total from from Net Investment
Transactions,
Year Ended beginning Investment Contracts, and Foreign Investment Investment Futures Contracts and
November 30, of period Income Currency Transactions Operations Income Foreign Currency
Transactions
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Wachovia Equity Fund
1996(1) $12.43 0.03 2.40 2.43 (0.05) --
1997 $14.81 0.17 2.43 2.60 (0.16) (1.86)
1998 $15.39 0.17 2.21 2.38 (0.17) (1.68)
1999 $15.92 0.12 3.38 3.50 (0.11) (1.89)
Wachovia Quantitative Equity Fund
1996(1) $13.09 0.04 2.60 2.64 (0.06) --
1997 $15.67 0.23 4.12 4.35 (0.23) (0.79)
1998 $19.00 0.23 3.06 3.29 (0.23) (1.75)
1999 $20.31 0.18 3.14 3.32 (0.17) (2.42)
Wachovia Growth & Income Fund
1998(6) $22.31 0.09 1.24 1.33 (0.09) --
1999 $23.55 0.12 4.24 4.36 (0.14) (2.89)
Wachovia Equity Index Fund
1996(1) $13.37 0.09(5) 2.60 2.69 (0.08) --
1997 $15.98 0.29 3.86 4.15 (0.31) (0.91)
1998 $18.91 0.30 3.92 4.22 (0.29) (0.40)
1999 $22.44 0.33 4.13 4.46 (0.32) (0.37)
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)
1998 $18.67 0.21 (0.84) (0.63) (0.15) (1.71)
1999 $16.18 0.30 0.54 0.84 (0.20) (0.75)
Wachovia Emerging Markets Fund
1996(1) $11.92 0.01(5) (0.26) (0.25) -- --
1997 $11.67 0.07 (0.50) (0.43) (0.11) --
1998 $11.13 0.13 (2.69) (2.56) (0.13) --
1999 $ 8.44 0.04 3.34 3.38 (0.07) --
Wachovia Personal Equity Fund
1996(3) $10.00 0.02 0.67 0.69 (0.01) --
Wachovia Balanced Fund
1996(1) $11.68 0.08 1.63 1.71 (0.09) --
1997 $13.30 0.38 1.39 1.77 (0.37) (1.44)
1998 $13.26 0.42 1.37 1.79 (0.41) (0.90)
1999 $13.74 0.32 1.44 1.76 (0.34) (1.69)
Wachovia Fixed Income Fund
1996(1) $ 9.45 0.17 0.40 0.57 (0.19) --
1997 $ 9.83 0.57 0.03 0.60 (0.58) --
1998 $ 9.85 0.56 0.29 0.85 (0.56) --
1999 $10.14 0.53 (0.58) (0.05) (0.53) (0.04)
Wachovia Intermediate Fixed Income
Fund
1998(6) $10.12 0.42 0.25 0.67 (0.41) --
1999 $10.38 0.53 (0.61) (0.08) (0.53) (0.20)
Wachovia Short-Term Fixed Income Fund
1996(1) $ 9.67 0.11(5) 0.18 0.29 (0.17) --
1997 $ 9.79 0.56 (0.05) 0.51 (0.53) --
1998 $ 9.77 0.54 0.14 0.68 (0.53) --
1999 $ 9.92 0.51 (0.25) 0.26 (0.55) --
Wachovia Georgia Municipal Bond Fund
1996(1) $10.71 0.17 0.29 0.46 (0.17) --
1997 $11.00 0.47 0.13 0.60 (0.47) (0.02)
1998 $11.11 0.45 0.27 0.72 (0.45) (0.00)(7)
1999 $11.38 0.45 (0.74) (0.29) (0.45) (0.03)
Wachovia North Carolina Municipal Bond Fund
1996(1) $10.71 0.16 0.32 0.48 (0.16) --
1997 $11.03 0.46 0.13 0.59 (0.45) (0.02)
1998 $11.15 0.46 0.32 0.78 (0.46) (0.01)
1999 $11.46 0.45 (0.68) (0.23) (0.45) (0.06)
Wachovia South Carolina Municipal Bond Fund
1996(1) $10.73 0.20 0.32 0.52 (0.20) --
1997 $11.05 0.55 0.12 0.67 (0.55) (0.05)
1998 $11.12 0.54 0.24 0.78 (0.54) (0.00)(7)
1999 $11.36 0.52 (0.77) (0.25) (0.52) (0.02)
Wachovia Virginia Municipal Bond Fund
1998(6) $10.34 0.32 0.15 0.47 (0.32) --
1999 $10.49 0.47 (0.65) (0.18) (0.47) --
<CAPTION>
Year Ended Total
November 30, Distributions
- ----------------------------------------------------------------------------------------------------------------------
<S> <C>
Wachovia Equity Fund
1996(1) (0.05)
1997 (2.02)
1998 (1.85)
1999 (2.00)
Wachovia Quantitative Equity Fund
1996(1) (0.06)
1997 (1.02)
1998 (1.98)
1999 (2.59)
Wachovia Growth & Income Fund
1998(6) (0.09)
1999 (3.03)
Wachovia Equity Index Fund
1996(1) (0.08)
1997 (1.22)
1998 (0.69)
1999 (0.69)
Wachovia Special Values Fund
1996(1) --
1997 (1.69)
1998 (1.86)
1999 (0.95)
Wachovia Emerging Markets Fund
1996(1) --
1997 (0.11)
1998 (0.13)
1999 (0.07)
Wachovia Personal Equity Fund
1996(3) (0.01)
Wachovia Balanced Fund
1996(1) (0.09)
1997 (1.81)
1998 (1.31)
1999 (2.03)
Wachovia Fixed Income Fund
1996(1) (0.19)
1997 (0.58)
1998 (0.56)
1999 (0.57)
Wachovia Intermediate Fixed Income
Fund
1998(6) (0.41)
1999 (0.73)
Wachovia Short-Term Fixed Income Fund
1996(1) (0.17)
1997 (0.53)
1998 (0.53)
1999 (0.55)
Wachovia Georgia Municipal Bond Fund
1996(1) (0.17)
1997 (0.49)
1998 (0.45)
1999 (0.48)
Wachovia North Carolina Municipal Bond Fund
1996(1) (0.16)
1997 (0.47)
1998 (0.47)
1999 (0.51)
Wachovia South Carolina Municipal Bond Fund
1996(1) (0.20)
1997 (0.60)
1998 (0.54)
1999 (0.54)
Wachovia Virginia Municipal Bond Fund
1998(6) (0.32)
1999 (0.47)
</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.
(3) Reflects operations for the period from July 30, 1999 (date of initial
public investment) to November 30, 1999.
(4) Computed on an annualized basis.
(5) Per share information is based on average shares outstanding. (6) Reflects
operations for the period from March 30, 1998 (date of initial
public investment) to November 30, 1998.
(7) Less than $0.01 per share.
(8) This contractual expense decrease is reflected in both the expense and net
investment income ratios.
(9) Less than 0.01%.
(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>
Ratios to
Average Net Assets
---------------------------------------
Net Asset Net Net Assets, Portfolio
Year Ended Value, end Total Investment Expense Waiver/ end of period Turnover
November 30, of period Return(2) Expenses Income Reimbursement(8) (000 omitted) Rate
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Wachovia Equity Fund
1996(1) $14.81 19.57% 0.90%(4) 0.91%(4) 0.19%(4) $129,205 64%
1997 $15.39 20.44% 0.90% 1.18% 0.07% $156,238 124%
1998 $15.92 17.69% 0.90% 1.13% -- $200,324 150%
1999 $17.42 24.52% 0.84% 0.73% -- $223,878 45%
Wachovia Quantitative Equity Fund
1996(1) $15.67 20.19% 0.87%(4) 1.19%(4) 0.11(4) $152,571 44%
1997 $19.00 29.60% 0.87% 1.35% 0.08% $183,019 74%
1998 $20.31 19.38% 0.87% 1.21% -- $207,343 38%
1999 $21.04 16.97% 0.86% 0.67% -- $598,420 34%
Wachovia Growth & Income Fund
1998(6) $23.55 6.03% 0.86%(4) 0.90%(4) 0.08%(4) $206,176 24%
1999 $24.88 20.73% 0.84% 0.49% -- $254,919 44%
Wachovia Equity Index Fund
1996(1) $15.98 20.14% 0.48%(4) 1.92%(4) 0.06%(4) $213,833 12%
1997 $18.91 27.91% 0.47% 1.72% 0.02% $248,030 4%
1998 $22.44 23.05% 0.45% 1.46% -- $291,708 29%
1999 $26.21 20.24% 0.44% 1.32% -- $361,934 11%
Wachovia Special Values Fund
1996(1) $15.67 15.05% 1.15%(4) 1.76%(4) 0.24%(4) $ 58,697 38%
1997 $18.67 33.29% 1.11% 0.88% 0.02% $ 84,501 46%
1998 $16.18 (3.59%) 1.00% 1.26% -- $ 90,550 20%
1999 $16.07 5.61% 0.98% 1.85% 0.00%(9) $109,969 44%
Wachovia Emerging Markets Fund
1996(1) $11.67 0.00% 0.63%(4) 0.45%(4) 0.13%(4) $123,036 30%
1997 $11.13 (3.73%) 1.54% 0.54% -- $139,700 60%
1998 $ 8.44 (23.34%) 1.44% 1.04% -- $130,898 51%
1999 $11.75 40.39% 1.35% 0.61% -- $178,443 56%
Wachovia Personal Equity Fund
1999(3) $10.68 6.85% 0.90%(4) 0.33%(4) 0.01%(4) $444,453 11%
Wachovia Balanced Fund
1996(1) $13.30 14.69% 0.76%(4) 2.85%(4) 0.16%(4) $235,791 99%
1997 $13.26 15.37% 0.77% 3.02% 0.16% $250,083 143%
1998 $13.74 14.77% 0.76% 3.15% 0.09% $290,833 124%
1999 $13.47 14.21% 0.76% 2.50% 0.08% $424,506 66%
Wachovia Fixed Income Fund
1996(1) $ 9.83 6.12% 0.75%(4) 6.33%(4) 0.14%(4) $175,836 181%
1997 $ 9.85 6.38% 0.74% 5.91% 0.11% $185,398 174%
1998 $10.14 8.92% 0.72% 5.55% 0.05% $212,886 111%
1999 $ 9.52 (0.53%) 0.72% 5.65% 0.03% $487,982 49%
Wachovia Intermediate Fixed
Income Fund
1998(6) $10.38 7.11% 0.74%(4) 5.39%(4) 0.14%(4) $ 87,831 57%
1999 $ 9.57 (0.77%) 0.74% 5.46% 0.04% $138,508 89%
Wachovia Short-Term Fixed Income
Fund
1996(1) $ 9.79 3.00% 0.64%(4) 5.77%(4) 0.19%(4) $116,138 145%
1997 $ 9.77 5.33% 0.63% 5.63% 0.20% $ 91,063 215%
1998 $ 9.92 7.19% 0.63% 5.47% 0.10% $ 98,433 135%
1999 $ 9.63 2.70% 0.63% 5.26% 0.14% $ 38,323 25%
Wachovia Georgia Municipal Bond
Fund
1996(1) $11.00 4.31% 0.89%(4) 4.84%(4) 1.57%(4) $ 6,803 14%
1997 $11.11 5.63% 0.92% 4.24% 1.06% $ 12,308 25%
1998 $11.38 6.62% 0.91% 3.96% 0.34% $ 17,030 14%
1999 $10.61 (2.59%) 0.68% 4.46% 0.37% $108,755 48%
Wachovia North Carolina Municipal
Bond Fund
1996(1) $11.03 4.55% 0.84%(4) 4.16%(4) 0.65%(4) $ 28,283 7%
1997 $11.15 5.57% 0.85% 4.16% 0.42% $ 44,104 17%
1998 $11.46 7.09% 0.85% 4.05% 0.16% $ 56,760 9%
1999 $10.72 (2.09%) 0.66% 4.27% 0.30% $434,523 11%
Wachovia South Carolina Municipal
Bond Fund
1996(1) $11.05 4.86% 0.57%(4) 5.56%(4) 0.54%(4) $ 36,511 20%
1997 $11.12 6.23% 0.58% 5.01% 0.48% $ 43,881 12%
1998 $11.36 7.15% 0.58% 4.77% 0.36% $ 54,770 6%
1999 $10.57 (2.24%) 0.58% 4.85% 0.35% $288,800 9%
Wachovia Virginia Municipal Bond
Fund
1998(6) $10.49 4.61% 0.68%(4) 4.62%(4) 0.33%(4) $ 99,154 15%
1999 $ 9.84 (1.76%) 0.65% 4.64% 0.29% $129,811 29%
</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.
(3) Reflects operations for the period from July 30, 1999 (date of initial
public investment) to November 30, 1999.
(4) Computed on an annualized basis.
(5) Per share information is based on average shares outstanding. (6) Reflects
operations for the period from March 30, 1998 (date of initial
public investment) to November 30, 1998.
(7) Less than $0.01 per share.
(8) This contractual expense decrease is reflected in both the expense and net
investment income ratios.
(9) Less than 0.01%.
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
The Wachovia Funds
The Wachovia Municipal Funds
Combined Notes to Financial Statements
November 30, 1999
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 nineteen 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>
<C> <S>
Portfolio Investment Objective
--------- --------------------
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 Personal Equity Fund To produce growth of principal and
("Personal Equity Fund") income.
Wachovia Balanced Fund To provide long-term growth of ("Balanced Fund")
principal and current income.
Wachovia Fixed Income Fund To seek a high level of total
("Fixed Income Fund") return.
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.
The Wachovia Municipal Funds
Portfolio Investment Objective
--------- --------------------
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
exempt from federal regular income ("North Carolina Municipal Bond tax and
the income taxes imposed Fund")** by the State of North Carolina.
Wachovia South Carolina Municipal Bond To provide current income which is Fund
exempt from federal regular income ("South Carolina Municipal Bond Fund")**
tax and South Carolina state
income taxes.
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 Wachovia Funds
The Wachovia Municipal Funds
The assets of each portfolio are segregated and a shareholder's interest is
limited to the portfolio in which shares are held. Effective March 30, 1998, the
following events affected the organization of the Trusts. The Growth & Income
Fund, the Intermediate Fixed Income Fund, and the Virginia Municipal Bond Fund
converted into Class A Shares of the Trusts from the MarketWatch Funds. The
Equity Fund, formerly a portfolio of the MarketWatch Funds, changed its name to
the Growth & Income Fund upon conversion. The Growth & Income Fund, the
Intermediate Fixed Income Fund, and the Virginia Municipal Bond Fund added a
second class of shares, Class Y Shares. Class A Shares resulting from the
conversion of the MarketWatch Funds, were exchanged into Class Y Shares. On July
30, 1999, the following Funds received a tax-free transfer of assets from the
Wachovia Common Trust Funds. <TABLE> <CAPTION>
Common
Fund Trust Fund Unrealized
Shares Net Assets Appreciation/
Issued Received (Depreciation) (1)
---------- ------------ ------------------
<S> <C> <C> <C>
Quantitative Equity Fund 18,308,897 $373,318,412 $210,964,004
Special Values Fund 368,577 6,217,889 740,648
Personal Equity Fund 42,839,470 428,394,696 163,566,983
Balanced Fund 19,580,102 249,842,105 32,051,587
Fixed Income Fund 27,808,700 265,851,176 (7,410,780)
Intermediate Fixed Income Fund 6,139,436 59,122,769 101,597
Short-Term Fixed Income Fund 737,496 7,116,836 12,696
Georgia Municipal Bond Fund 8,083,520 88,191,199 1,136,482
North Carolina Municipal Bond Fund 33,367,726 366,043,958 6,254,172
South Carolina Municipal Bond Fund 20,754,532 225,809,305 5,863,930
Virginia Municipal Bond Fund 3,242,961 32,818,769 (57,431)
</TABLE>
(1) Unrealized appreciation/(depreciation) is included in the Common Trust Fund
net assets acquired above.
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 US 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"). 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. Non-cash dividends included in dividend income, if any, are
recorded at fair value. The Trusts offer multiple classes of shares, which
differ in their respective distribution and service fees. All shareholders
bear the common expenses of the Fund based on average daily net assets of each
class, without distinction between share classes. Dividends are declared
separately for each class. No class has preferential dividend rights;
differences in per share dividend rates are generally due to differences in
separate class expenses.
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
provision for federal tax is necessary.
Withholding taxes on foreign interest, dividends and capital gains in the
Emerging Markets Fund have been provided for in accordance with the applicable
country's tax rules and rates.
At November 30, 1999, 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 Amount
Tax Loss Expiring Expiring Expiring Expiring Expiring Expiring
Fund Carryforward In 2002 In 2003 In 2004 In 2005 In 2006 In 2007
---- ------------ ---------- -------- -------- -------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Emerging Markets Fund $26,221,931 $ -- $ -- $ -- $939,725 $25,282,206 $ --
Fixed Income Fund 2,177,586 -- -- -- -- -- 2,177,586
Short-Term Fixed Income Fund 3,064,915 2,260,880 250,580 467,184 86,271 -- --
Georgia Municipal Bond Fund 575,481 -- -- -- -- -- 575,481
Virginia Municipal Bond Fund 1,435,169 950,642 -- 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.
Losses may occur on these transactions due to changes in market conditions or
the failure of counterparties to perform under the contract.
Futures Contracts--The Funds listed below purchased 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 November 30, 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 $10,856,267
Quantitative Fund 8,641,991
Growth & Income Fund 4,553,978
Equity Index Fund 13,483,203
Special Values Fund 2,674,490
Personal Equity Fund (439,279)
Balanced Fund 7,746,562
Fixed Income Fund 615,573
Intermediate Fixed Income Fund 150,517
</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.
At November 30, 1999, the Funds had outstanding futures contracts as set forth
below:
Equity Fund
<TABLE>
<CAPTION>
Contract to Unrealized
Expiration Date Deliver/Receive Position Appreciation
--------------- --------------- -------- ------------
<S> <C> <C> <C>
December 1999 154 S&P 500 Index Futures Long $ 873,393
</TABLE>
Quantitative Equity Fund
<TABLE>
<CAPTION>
Contract to Unrealized
Expiration Date Deliver/Receive Position Appreciation
--------------- --------------- -------- ------------
<S> <C> <C> <C>
December 1999 45 S&P 500 Index Futures Long $ 872,449
</TABLE>
Growth & Income Fund
<TABLE>
<CAPTION>
Contract to Unrealized
Expiration Date Deliver/Receive Position Appreciation
--------------- --------------- -------- ------------
<S> <C> <C> <C>
December 1999 61 S&P 500 Index Futures Long $ 293,212
</TABLE>
Equity Index Fund
<TABLE>
<CAPTION>
Contract to Unrealized
Expiration Date Deliver/Receive Position Appreciation
--------------- --------------- -------- ------------
<S> <C> <C> <C>
December 1999 177 S&P 500 Index Futures Long $ 868,884
</TABLE>
Special Values FUND
<TABLE>
<CAPTION>
Contract to Unrealized
Expiration Date Deliver/Receive Position Appreciation
--------------- ------------------------------- -------- ------------
<S> <C> <C> <C>
December 1999 50 S&P Midcap 400 Index Futures Long $ 165,100
</TABLE>
Personal Equity Fund
<TABLE>
<CAPTION>
Contract to Unrealized
Expiration Date Deliver/Receive Position Appreciation
--------------- --------------- -------- ------------
<S> <C> <C> <C>
December 1999 73 S&P 500 Index Futures Long $ 207,541
</TABLE>
Balanced Fund
<TABLE>
<CAPTION>
Unrealized
Contract to Appreciation/
Expiration Date Deliver/Receive Position (Depreciation)
--------------- --------------- -------- --------------
<S> <C> <C> <C>
December 1999 39 5-Year U.S. Treasury Notes Futures Long $ (33,203)
December 1999 30 U.S. Treasury Bonds Futures Short 77,552
December 1999 17 10-Year U.S. Treasury Notes Futures Short (14,262)
---------
$ 30,087
</TABLE>
Fixed Income Fund
<TABLE>
<CAPTION>
Unrealized
Contract to Appreciation/
Expiration Date Deliver/Receive Position (Depreciation)
--------------- --------------- -------- --------------
<S> <C> <C> <C>
December 1999 40 CAN Gov't Bonds Futures Long $(110,129)
December 1999 19 5-Year U.S. Treasury Notes Futures Long (17,334)
December 1999 150 U.S. Treasury Bonds Futures Long (201,054)
December 1999 50 2-Year U.S. Treasury Notes Futures Short 56,491
December 1999 129 5-Year U.S. Treasury Notes Futures Short 138,214
---------
$(133,812)
</TABLE>
Intermediate Fixed Income Fund
<TABLE>
<CAPTION>
Contract to Unrealized
Expiration Date Deliver/Receive Position Appreciation
--------------- --------------- -------- ------------
<S> <C> <C> <C>
December 1999 20 5-Year U.S. Treasury Notes Futures Short $ 16,875
December 1999 17 U.S. Treasury Long Bond Futures Short 29,086
---------
$ 45,961
</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 November 30, 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. 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.
Reclassification--In accordance with Statement of Position 93-2 Determination,
Disclosure, and Financial Statement Presentation of Income, Capital Gain, and
Return of Capital by Investment Companies ("SOP 93-2"), permanent book and tax
differences have been reclassified to paid-in-capital. These differences are
primarily due to differing treatments for foreign currency transactions,
market discount and paydowns on certain debt instruments. Amounts for the
Funds, as of November 30, 1999, have been reclassified to reflect the
following:
<TABLE>
<CAPTION>
Increase (Decrease)
----------------------------------------------------------------------------
Undistributed Net Investment
Accumulated Income/Accumulated
Paid-In Net Realized Distributions in Excess of
Fund Name Capital Gain/Loss Net Investment Income
--------- ------- ------------ ----------------------------
<S> <C> <C> <C>
Equity Fund (131) 158 (27)
Emerging Market Fund 31,679 (697,568) 665,889
Balanced Fund 852 (851) (1)
Fixed Income Fund (1) 19,649 (19,648)
North Carolina Municipal
Bond Fund (42,405) (5,936) 48,341
</TABLE>
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 Fund will not incur any registration costs upon such resales.
The Fund's 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.
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 a trade date basis.
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
----------------------------------------------
- -----------------------------------------------
Year Ended Year Ended
November 30, November 30,
1999 1998 1999 1998
Class A Shares Shares Dollars Shares Dollars Shares Dollars Shares
Dollars
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 4,052,281 $63,873,580 924,716 $13,703,327 953,578 $19,776,828 2,588,389
$48,886,094
Shares issued to
shareholders in payment
of distributions
declared 461,898 6,725,775 353,528 4,797,366 485,602 10,032,446 222,235
3,819,153
Shares redeemed (1,021,992) (16,434,402) (506,801) (7,457,571) (1,269,823) (26,574,214) (599,567)
(11,284,446)
---------- ----------- -------- ----------- ---------- ----------- ---------
- -----------
Net change resulting
from Class A Shares
transactions 3,492,187 $54,164,953 771,443 $11,043,122 169,357 $ 3,235,060 2,211,057
$41,420,801
---------- ----------- -------- ----------- ---------- ----------- ---------
- -----------
</TABLE>
<TABLE>
<CAPTION>
Equity Fund continued Quantitative Equity Fund continued
----------------------------------------------------
- -------------------------------------------------
Year Ended Year Ended
November 30, November 30,
1999 1998 1999 1998
Class B Shares Dollars Shares Dollars Shares Dollars Shares
Dollars
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 143,892 $ 2,281,670 139,205 $ 2,092,971 210,364 $ 4,363,910 633,822
$12,088,957
Shares issued to
shareholders in
payment of
distributions
declared 46,508 673,905 29,176 393,654 122,061 2,518,535
39,020 665,947
Shares redeemed (32,015) (512,884) (32,270) (471,352) (118,994) (2,474,854) (53,666)
(995,247)
---------- ------------ ----------- ------------- ---------- ------------ ----------
- -----------
Net change
resulting from
Class B Shares
transactions 158,385 $ 2,442,691 136,111 $ 2,015,273 213,431 $ 4,407,591 619,176
$11,759,657
---------- ------------ ----------- ------------- ---------- ------------ ----------
- -----------
<CAPTION>
Year Ended Year Ended
November 30, November 30,
1999 1998 1999 1998
Class Y Shares Shares Dollars Shares Dollars Shares Dollars Shares
Dollars
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 3,776,292 $ 60,058,148 4,380,401 $ 64,007,995 1,025,164 $ 21,075,310 1,326,703
$24,567,733
Shares issued in
connection with
the tax-free
exchange of
assets from a
Common Trust
Fund -- -- -- -- 18,308,897 373,318,412
- -- --
Shares issued to
shareholders in
payment of
distributions
declared 1,183,674 17,218,904 1,000,056 13,577,140 1,137,268 23,539,620 1,014,452
17,399,559
Shares redeemed (4,695,161) (73,803,563) (2,944,530) (43,863,733) (2,241,018) (46,184,830) (1,761,030)
(32,169,312)
---------- ------------ ----------- ------------- ---------- ------------ ----------
- -----------
Net change
resulting from
Class Y Shares
transactions 264,805 $ 3,473,489 2,435,927 $ 33,721,402 18,230,311 $371,748,512 580,125 $
9,797,980
---------- ------------ ----------- ------------- ---------- ------------ ----------
- -----------
Net change
resulting from
fund shares
transactions 3,915,377 $ 60,081,133 3,343,481 $ 46,779,797 18,613,098 $379,391,163 3,410,358
$62,978,438
---------- ------------ ----------- ------------- ---------- ------------ ----------
- -----------
<CAPTION>
Growth & Income Fund
----------------------------------------------------
Year Ended
November 30,
1999 1998
Class A Shares Shares Dollars Shares Dollars
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 281,205 $ 6,454,877 500,103 $ 10,555,907
Shares issued to
shareholders in
payment of
distributions
declared 755,024 16,039,988 484,959 9,614,799
Exchange into
Class Y shares -- -- (9,553,829) (213,145,727)
Shares redeemed (2,764,933) (66,276,113) (2,336,814) (48,594,932)
---------- ------------ ----------- -------------
Net change
resulting from
Class A Shares
transactions (1,728,704) $(43,781,248) (10,905,581) $(241,569,953)
---------- ------------ ----------- -------------
</TABLE>
<TABLE>
<CAPTION>
Growth & Income Fund continued
-------------------------------------------------
Period Ended
November 30,
1999 1998 (1)
Class Y Shares Shares Dollars Shares Dollars
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 3,064,027 $72,849,243 215,719 $ 4,785,076
Exchange from
Class A shares -- -- 9,553,829 213,145,727
Shares issued to
shareholders in
payment of
distributions
declared 201,549 4,288,610 7,342 153,661
Shares redeemed (1,776,432) (40,947,570) (1,021,427) (22,575,885)
---------- ----------- ---------- ------------
Net change
resulting from
Class Y Shares
transactions 1,489,144 $36,190,283 8,755,463 $195,508,579
---------- ----------- ---------- ------------
Net change
resulting from
fund shares
transactions (239,560) $(7,590,965) (2,150,118) $(46,061,374)
---------- ----------- ---------- ------------
<CAPTION>
Equity Index Fund Special Values Fund
-------------------------------------------------
- ------------------------------------------------
Year Ended Year Ended
November 30, November 30,
1999 1998 1999 1998
Class A Shares Shares Dollars Shares Dollars Shares Dollars Shares
Dollars
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 2,433,185 $59,425,268 3,701,907 $ 76,535,465 1,648,997 $25,747,530 2,610,113
$45,663,955
Shares issued to
shareholders in
payment of
distributions
declared 161,487 3,783,553 109,762 2,088,409 221,638 3,320,559 248,937
4,102,490
Shares redeemed (1,486,793) (36,669,214) (636,039) (13,107,910) (1,475,880) (23,294,839) (1,202,936)
(19,509,112)
---------- ----------- ---------- ------------ ---------- ----------- ----------
- -----------
Net change
resulting from
Class A Shares
transactions 1,107,879 $26,539,607 3,175,630 $ 65,515,964 394,755 $ 5,773,250 1,656,114
$30,257,333
---------- ----------- ---------- ------------ ---------- ----------- ----------
- -----------
<CAPTION>
Year Ended Period Ended
November 30, November 30,
1999 1998 1999(2) 1998
Class B Shares Shares Dollars Shares Dollars Shares Dollars Shares
Dollars
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold -- -- -- -- 22,330 $360,128
- -- --
Shares redeemed -- -- -- -- (440) (7,001)
- -- --
---------- ----------- ---------- ------------ ---------- ----------- ----------
- -----------
Net change
resulting from
Class B Shares
transactions -- -- -- -- 21,890 $353,127
- -- --
---------- ----------- ---------- ------------ ---------- ----------- ----------
- -----------
</TABLE>
(1) Reflects operations for the period from March 30, 1998 (date of initial
public investment) to November 30, 1998.
(2) Reflects operations for the period from March 26, 1999 (date of initial
public investment) to November 30, 1999.
<TABLE>
<CAPTION>
Equity Index Fund continued Special Values Fund continued
--------------------------------------------------
- -------------------------------------------------
Year Ended Year Ended
November 30, November 30,
1999 1998 1999 1998
Class Y Shares Shares Dollars Shares Dollars Shares Dollars Shares
Dollars
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 3,624,816 $ 89,366,742 2,854,402 $ 58,057,370 1,866,656 $ 29,627,043 1,475,771 $
25,185,127 Shares issued in connection with the tax-free exchange of assets from
a Common
Trust Fund -- -- -- -- 368,577 6,217,889
- -- --
Shares issued to
shareholders in
payment of
distributions
declared 359,520 8,442,713 454,689 8,624,862 269,815 4,041,990 422,376
6,964,972
Shares redeemed (3,174,724) (78,112,061) (3,418,715) (70,167,430) (1,259,252) (20,017,864) (827,147)
(13,991,139)
---------- ------------ ---------- ------------ ---------- ------------ ---------
- ------------
Net change
resulting from
Class Y Shares
transactions 809,612 $ 19,697,394 (109,624) $ (3,485,198) 1,245,796 $ 19,869,058 1,071,000 $
18,158,960
---------- ------------ ---------- ------------ ---------- ------------ ---------
- ------------
Net change
resulting from
fund shares
transactions 1,917,491 $ 46,237,001 3,066,006 $ 62,030,766 1,662,441 $ 25,995,435 2,727,114 $
48,416,293
---------- ------------ ---------- ------------ ---------- ------------ ---------
- ------------
<CAPTION>
Emerging Markets Fund Personal Equity Fund
--------------------------------------------------
- -------------------------------------------------
Year Ended Period Ended
November 30, November 30,
1999 1998 1999(1) 1998
Class A Shares Shares Dollars Shares Dollars Shares Dollars Shares
Dollars
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 1,435,937 $ 13,700,861 692,384 $ 6,536,524 10,285 $ 108,394
- -- --
Shares issued to
shareholders in
payment of
distributions
declared 5,838 48,574 7,323 79,306 -- --
- -- --
Shares redeemed (1,107,036) (11,087,791) (389,449) (3,539,372) -- --
- -- --
---------- ------------ ---------- ------------ ---------- ------------ ---------
- ------------
Net change
resulting from
Class A Shares
transactions 334,739 $ 2,661,644 310,258 $ 3,076,458 10,285 $ 108,394
- -- --
---------- ------------ ---------- ------------ ---------- ------------ ---------
- ------------
<CAPTION>
Year Ended Period Ended
November 30, November 30,
1999 1998 1999(1) 1998
Class Y Shares Shares Dollars Shares Dollars Shares Dollars Shares
Dollars
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 2,120,687 $ 21,432,137 5,272,409 $ 53,125,694 212,717 $ 2,135,793
- -- --
Shares issued in
connection with
the tax-free
exchange of assets
from a Common
Trust Fund -- -- -- -- 42,839,470 428,394,696
- -- --
Shares issued to
shareholders in
payment of
distributions
declared 40,439 336,056 49,656 537,283 6 63
- -- --
Shares redeemed (2,487,448) (24,885,093) (2,367,712) (21,683,002) (1,422,396) (14,516,568)
- -- --
---------- ------------ ---------- ------------ ---------- ------------ ---------
- ------------
Net change
resulting from
Class Y Shares
transactions (326,322) $ (3,116,900) 2,954,353 $ 31,979,975 41,629,797 $416,013,984
- -- --
---------- ------------ ---------- ------------ ---------- ------------ ---------
- ------------
Net change
resulting from
fund shares
transactions 8,417 $ (455,254) 3,264,611 $ 35,056,433 41,640,082 $416,122,378
- -- --
---------- ------------ ---------- ------------ ---------- ------------ ---------
- ------------
</TABLE>
(1) Reflects operations for the period from July 30, 1999 (date of initial
public investment) to November 30, 1999.
<TABLE>
<CAPTION>
Balanced Fund Fixed Income Fund
--------------------------------------------------
- -------------------------------------------------
Year Ended Year Ended
November 30, November 30,
1999 1998 1999 1998
Class A Shares Shares Dollars Shares Dollars Shares Dollars Shares
Dollars
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 13,302,993 $175,398,809 5,764,174 $75,056,038 5,871,429 $ 58,049,075 1,958,828
$19,573,923
Shares issued to
shareholders in
payment of
distributions
declared 1,655,692 21,296,221 490,771 6,104,654 303,232 2,942,729 89,113
890,891
Shares redeemed (8,386,327) (110,347,891) (1,421,643) (18,503,796) (1,305,306) (12,764,043) (638,391)
(6,425,094)
----------- ------------ ---------- ----------- ---------- ------------ ----------
- -----------
Net change
resulting from
Class A Shares
transactions 6,572,358 $ 86,347,139 4,833,302 $62,656,896 4,869,355 $ 48,227,761 1,409,550
$14,039,720
----------- ------------ ---------- ----------- ---------- ------------ ----------
- -----------
<CAPTION>
Year Ended Year Ended
November 30, November 30,
1999 1998 1999 1998
Class B Shares Shares Dollars Shares Dollars Shares Dollars Shares
Dollars
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 482,978 $ 6,309,015 593,884 $ 7,769,427 34,614 $ 346,537 39,258 $
390,310
Shares issued to
shareholders in
payment of
distributions
declared 168,767 2,160,724 50,089 621,444 2,744 26,754
1,271 12,687
Shares redeemed (111,088) (1,451,271) (71,305) (925,661) (3,870) (37,172) (2,161)
(21,523)
----------- ------------ ---------- ----------- ---------- ------------ ----------
- -----------
Net change
resulting from
Class B Shares
transactions 540,657 $ 7,018,468 572,668 $ 7,465,210 33,488 $ 336,119 38,368 $
381,474
----------- ------------ ---------- ----------- ---------- ------------ ----------
- -----------
<CAPTION>
Year Ended Year Ended
November 30, November 30,
1999 1998 1999 1998
Class Y Shares Shares Dollars Shares Dollars Shares Dollars Shares
Dollars
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 2,668,388 $ 35,085,877 6,639,501 $84,289,682 10,929,844 $107,071,894 6,174,243
$61,683,285
Shares issued in
connection with
the tax-free
exchange of
assets from a
Common Trust Fund 19,580,102 249,842,105 -- -- 27,808,700 265,851,176
- -- --
Shares issued to
shareholders in
payment of
distributions
declared 2,693,593 34,392,661 1,895,507 23,557,253 680,497 6,648,424 661,726
6,595,044
Shares redeemed (14,589,443) (192,444,437) (6,222,414) (80,542,002) (9,142,482) (89,531,987) (4,662,142)
(46,579,297)
----------- ------------ ---------- ----------- ---------- ------------ ----------
- -----------
Net change
resulting from
Class Y Shares
transactions 10,352,640 $126,876,206 2,312,594 $27,304,933 30,276,559 $290,039,507 2,173,827
$21,699,032
----------- ------------ ---------- ----------- ---------- ------------ ----------
- -----------
Net change
resulting from
fund shares
transactions 17,465,655 $220,241,813 7,718,564 $97,427,039 35,179,402 $338,603,387 3,621,745
$36,120,226
----------- ------------ ---------- ----------- ---------- ------------ ----------
- -----------
</TABLE>
<TABLE>
<CAPTION>
Intermediate Fixed Income Fund Short-Term Fixed Income Fund
-------------------------------------------------
- -------------------------------------------------
Year Ended Year Ended
November 30, November 30,
1999 1998 1999 1998
Class A Shares Shares Dollars Shares Dollars Shares Dollars Shares
Dollars
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 9,273 $ 90,669 432,820 $ 4,395,676 334,823 $ 3,271,760 728,996 $
7,145,299
Shares issued to
shareholders in
payment of
distributions
declared 25,998 258,389 36,581 370,365 53,919 526,016 48,837
478,947
Exchange into
Class Y shares -- -- (8,913,728) (89,493,831) -- --
- -- --
Shares redeemed (158,864) (1,556,247) (732,895) (7,416,845) (360,394) (3,523,088) (465,982)
(4,580,525)
---------- ----------- ---------- ------------ ---------- ------------ ----------
- -----------
Net change
resulting from
Class A Shares
transactions (123,593) $(1,207,189) (9,177,222) $(92,144,635) 28,348 $ 274,688 311,851 $
3,043,721
---------- ----------- ---------- ------------ ---------- ------------ ----------
- -----------
<CAPTION>
Year Ended Year Ended
November 30, November 30,
1999 1998(1) 1999 1998
Class Y Shares Shares Dollars Shares Dollars Shares Dollars Shares
Dollars
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 2,073,597 $20,392,480 512,332 $ 5,220,989 1,090,901 $ 10,708,051 2,210,120
$21,733,419
Exchange from
Class A shares -- -- 8,913,728 89,493,831 -- --
- -- --
Shares issued in
connection with
the tax-free
exchange of
assets from a
Common Trust Fund 6,139,436 59,122,769 -- -- 737,496 7,116,836
- -- --
Shares issued to
shareholders in
payment of
distributions
declared 39,790 392,705 21,849 222,630 232,891 2,277,295 500,524
4,905,077
Shares redeemed (2,241,312) (22,106,920) (986,184) (10,094,154) (8,005,559) (78,981,570) (2,109,395)
(20,644,860)
---------- ----------- ---------- ------------ ---------- ------------ ----------
- -----------
Net change
resulting from
Class Y Shares
transactions 6,011,511 $57,801,035 8,461,725 $ 84,843,296 (5,944,271) $(58,879,388) 601,249 $
5,993,636
---------- ----------- ---------- ------------ ---------- ------------ ----------
- -----------
Net change
resulting from
fund shares
transactions 5,887,918 $56,593,845 (715,497) $ (7,301,339) (5,915,921) $(58,604,700) 913,100 $
9,037,357
---------- ----------- ---------- ------------ ---------- ------------ ----------
- -----------
(1) Reflects operations for the period from March 30, 1998 (date of initial
public investment) to November 30, 1998.
</TABLE>
<TABLE>
<CAPTION>
Georgia Municipal Bond Fund North Carolina Municipal Bond Fund
---------------------------------------- -------------------------------------------
Year Ended Year Ended
November 30, November 30,
1999 1998 1999 1998
Class A Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 33,237 $ 371,656 65,313 $734,230 90,928 $1,014,339 73,195 $ 827,761
Shares issued to
shareholders in
payment of distributions
declared 19,481 215,076 18,608 209,598 28,563 317,676 28,831 326,515
Shares redeemed (145,519) (1,595,698) (65,246) (732,153) (145,558) (1,600,626) (308,552) (3,504,406)
-------- ----------- ------- -------- -------- ---------- -------- -----------
Net change resulting
from
Class A Shares
transactions (92,801) $(1,008,966) 18,675 $211,675 (26,067) $ (268,611) (206,526) $(2,350,130)
-------- ----------- ------- -------- -------- ---------- -------- -----------
</TABLE>
<TABLE>
<CAPTION>
Georgia Municipal Bond Fund continued North Carolina Municipal Bond Fund
continued
------------------------------------------------
- ------------------------------------------------
Year Ended Year Ended
November 30, November 30,
1999 1998 1999 1998
Class Y Shares Shares Dollars Shares Dollars Shares Dollars
Shares Dollars
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
<C>
Shares sold 1,193,251 $ 13,142,034 514,361 $ 5,807,306 3,602,963 $ 39,881,430 1,450,528
$16,388,977
Shares issued in
connection with the
tax-free exchange of
assets from a Common
Trust Fund 8,083,520 88,191,199 -- -- 33,367,726 366,043,958
- -- --
Shares issued to
shareholders in payment
of distributions
declared 6,888 75,864 5,535 62,357 35,745 399,376
17,718 200,910
Shares redeemed (529,304) (5,769,696) (130,688) (1,473,631) (1,438,326) (15,643,547) (465,404)
(5,270,187)
---------- ------------ --------- ----------- ---------- ------------ ---------
- -----------
Net change resulting
from
Y Shares transactions 8,754,355 $ 95,639,401 389,208 $ 4,396,032 35,568,108 $390,681,219 1,002,842
$11,319,700
---------- ------------ --------- ----------- ---------- ------------ ---------
- -----------
Net change resulting
from
fund shares
transactions 8,661,554 $ 94,630,435 407,883 $ 4,607,707 35,542,041 $390,412,606 796,316
$ 8,969,570
---------- ------------ --------- ----------- ---------- ------------ ---------
- -----------
<CAPTION>
South Carolina Municipal Bond Fund
------------------------------------------------
Year Ended
November 30,
1999 1998
Class A Shares Shares Dollars Shares Dollars
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 499,667 $ 5,542,698 742,299 $ 8,356,816
Shares issued to
shareholders in payment
of distributions
declared 181,068 1,989,742 167,413 1,887,761
Shares redeemed (974,649) (10,649,307) (786,074) (8,835,765)
---------- ------------ --------- -----------
Net change resulting
from
Class A Shares
transactions (293,914) $ (3,116,867) 123,638 $ 1,408,812
---------- ------------ --------- -----------
<CAPTION>
Year Ended
November 30,
1999 1998
Class Y Shares Shares Dollars Shares Dollars
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 2,892,396 $ 31,736,212 1,382,049 $15,581,081
Shares issued in
connection with the
tax-free exchange of
assets from a Common
Trust Fund 20,754,532 225,809,305 -- --
Shares issued to
shareholders in payment
of distributions
declared 18,138 199,065 13,296 149,911
Shares redeemed (1,154,051) (12,417,303) (517,410) (5,814,407)
---------- ------------ --------- -----------
Net change resulting
from
Class Y Shares
transactions 22,511,015 $245,327,279 877,935 $ 9,916,585
---------- ------------ --------- -----------
Net change resulting
from
fund shares
transactions 22,217,101 $242,210,412 1,001,573 $11,325,397
---------- ------------ --------- -----------
</TABLE>
<TABLE>
<CAPTION>
Virginia Municipal Bond Fund
--------------------------------------------------
Year Ended
November 30,
1999 1998
Class A Shares Shares Dollars Shares Dollars
- ----------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 24,086 $ 251,062 293,734 $ 3,057,205
Shares issued to
shareholders in
payment of
distributions
declared 27,430 279,843 29,282 304,418
Exchange into
Class Y shares -- -- (9,794,711) (101,277,312)
Shares redeemed (113,459) (1,154,829) (488,052) (5,071,444)
---------- ----------- ---------- -------------
Net change
resulting from
Class A Shares
transactions (61,943) $ (623,924) (9,959,747) $(102,987,133)
---------- ----------- ---------- -------------
<CAPTION>
Period Ended
November 30,
1999 1998(1)
Class Y Shares Shares Dollars Shares Dollars
- ----------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 2,556,035 $26,045,020 561,359 $ 5,860,079
Shares issued in
connection with
the tax-free
exchange of
assets from a
Common Trust
Fund 3,242,961 32,818,769 -- --
Exchange from
Class A shares -- -- 9,794,711 101,277,312
Shares issued to
shareholders in
payment of
distributions
declared 27,283 275,816 3,580 37,331
Shares redeemed (2,089,477) (21,200,920) (910,974) (9,483,614)
---------- ----------- ---------- -------------
Net change
resulting from
Class Y Shares
transactions 3,736,802 $37,938,685 9,448,676 $ 97,691,108
---------- ----------- ---------- -------------
Net change
resulting from
fund shares
transactions 3,674,859 $37,314,761 (511,071) $ (5,296,025)
---------- ----------- ---------- -------------
</TABLE>
(1) Reflects operations for the period from March 30, 1998 (date of initial
public investment) to November 30, 1998.
4. Investment Adviser Fee and Other Transactions with Affiliates Investment
Adviser Fee--Wachovia Asset Management, a subsidiary of Wachovia Bank, N.A. and
the Funds' investment adviser (the "Adviser"), receives for its services an
annual investment adviser fee based on a percentage of each Fund's average daily
net assets as listed below.
<TABLE>
<CAPTION>
Annual Rate Fund
----------- ----
<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%
Personal Equity Fund 0.70%
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>
As a result of contractual obligations, the Adviser may be required to waive any
portion of its fee. The Adviser can modify or terminate this waiver at its sole
discretion at any time after January 31, 2001. * Prior to March 29, 1998, the
annual investment adviser 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.
Sub Adviser Fee--The Adviser has entered into a sub-advisory agreement with Twin
Capital Management, Inc. (the "Sub-Adviser"). The Sub-Adviser furnishes certain
adviser 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. Distribution Services
Fee--Equity Fund, Quantitative Equity Fund, Special Values 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. 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.
Organizational Expenses--Organizational expenses were borne initially by FAS.
The Funds have reimbursed FAS for the organizational expenses. These expenses
have been deferred and are being amortized over the five-year period following
each Fund's effective date. For the year ended November 30, 1999, the Funds
expensed the following amounts pursuant to this agreement:
<TABLE>
<CAPTION>
Organizational Organizational
Fund Expenses Expenses Paid
---- -------------- --------------
<S> <C> <C>
Emerging Markets Fund $40,764 $17,788
Georgia Municipal Bond Fund $30,000 $ 9,391
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.
5. Investment Transactions
Purchases and sales of investments, excluding short-term securities, for the
period ended November 30, 1999, were as follows:
<TABLE>
<CAPTION>
Fund Purchases Sales
- ---- ------------ ------------
<S> <C> <C>
Equity Fund $144,635,541 $119,428,961
Quantitative Equity Fund 144,082,605 151,133,803
Growth & Income Fund 140,984,246 180,637,704
Equity Index Fund 51,058,748 99,147,328
Special Values Fund 62,038,604 60,932,871
Emerging Markets Fund 86,988,003 87,303,268
Personal Equity Fund 45,991,790 74,705,882
Balanced Fund 305,133,992 354,886,877
Fixed Income Fund 246,207,093 166,264,291
Intermediate Fixed Income Fund 91,539,161 90,284,722
Short-Term Fixed Income Fund 14,124,900 77,256,318
Georgia Municipal Bond Fund 31,871,447 24,453,363
North Carolina Municipal Bond Fund 51,723,218 18,881,237
South Carolina Municipal Bond Fund 35,212,957 16,614,268
Virginia Municipal Bond Fund 32,884,704 44,235,101
</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 November 30, 1999,
the diversification of the industries for the Emerging Markets Fund was as
follows:
<TABLE>
<CAPTION>
Industry % of Net Assets
- -------- ---------------
<S> <C>
Communication Services 18.1%
Finance 16.9%
Basic Materials 10.8%
Technology 8.5%
Consumer Staples 7.8%
Multi-Industry 6.5%
Closed End Funds 6.1%
Energy 5.9%
Consumer Cyclicals 4.9%
Utilities 4.8%
Other 1.9%
Health Care 1.8%
Transportation 1.5%
Capital Goods 0.4%
</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 November 30, 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.
<TABLE>
<CAPTION>
% of Portfolio Backed by
% of Portfolio Largest
Fund Guaranteed/Insured Guarantor/Insurer
- ---- ------------------ ------------------------
<S> <C> <C>
Georgia Municipal Bond Fund 35.4% 9.6%
North Carolina Municipal Bond Fund 17.4% 7.2%
South Carolina Municipal Bond Fund 61.3% 25.3%
Virginia Municipal Bond Fund 21.5% 4.3%
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Report of Ernst & Young LLP, Independent Auditors
To the Trustees and Shareholders of THE WACHOVIA FUNDS and THE WACHOVIA
MUNICIPAL FUNDS:
We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of the 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
Personal Equity Fund, Wachovia Balanced Fund, Wachovia Fixed Income Fund,
Wachovia Intermediate Fixed Income Fund, and the Wachovia Short-Term Fixed
Income Fund (11 of the portfolios constituting The Wachovia Funds) and the
Wachovia Georgia Municipal Bond Fund, Wachovia North Carolina Municipal Bond
Fund, Wachovia South Carolina Municipal Bond Fund, and Wachovia Virginia
Municipal Bond Fund (the 4 portfolios constituting The Wachovia Municipal Funds)
as of November 30, 1999, and the related statements of operations for the year
then ended, the statements of changes in net assets for each of the two years in
the period then ended and the financial highlights for each of the periods
presented therein. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of securities
owned as of November 30, 1999, by correspondence with the custodian and brokers
or other appropriate auditing procedures where replies from brokers were not
received. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
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 Personal Equity Fund, Wachovia Balanced Fund,
Wachovia Fixed Income Fund, Wachovia Intermediate Fixed Income Fund, Wachovia
Short-Term Fixed Income Fund (portfolios of The Wachovia Funds) and the Wachovia
Georgia Municipal Bond Fund, Wachovia North Carolina Municipal Bond Fund,
Wachovia South Carolina Municipal Bond Fund, and Wachovia Virginia Municipal
Bond Fund (portfolios of The Wachovia Municipal Funds) at November 30, 1999, the
results of their operations for the year then ended, the changes in their net
assets for each of the two years in the period then ended, and the financial
highlights for each of the periods presented therein, in conformity with
accounting principles generally accepted in the United States.
Boston, Massachusetts
January 17, 2000
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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 Gail Cagney
Charles S. Way, Jr. Secretary
Timothy S. Johnson
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.
Federated Securities Corp., Distributor
831-27 (1/00)
G01512-17 (1/00)
WACHOVIA MONEY MARKET FUND
WACHOVIA TAX-FREE
MONEY MARKET FUND
WACHOVIA U.S. TREASURY
MONEY MARKET FUND
INVESTMENT SHARES
Annual Report
November 30, 1999
[LOGO OF WACHOVIA FUNDS]
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
(1) Bank Notes--7.7%
Banking & Finance--7.7%
$30,000,000 Bank of America, NA, 5.850%-5.870%, 1/20/2000-
4/19/2000 $ 30,000,000
10,000,000 Bank of America, NC, 6.000%, 3/22/2000 10,000,000
25,000,000 First National Bank of Chicago, 5.850%, 2/24/2000 25,000,575
10,000,000 LaSalle National Bank, Chicago, 5.130%, 4/25/2000 9,998,459
------------
Total Bank Notes 74,999,034
------------
(1) Certificates of Deposit--18.4%
Banking & Finance--18.4%
20,000,000 ABN AMRO Bank NV, Amsterdam, 5.860%, 5/23/2000 20,000,000
40,000,000 Bayerische Landesbank Girozentrale, 5.850%-5.870%,
3/9/2000-3/15/2000 40,001,099
15,000,000 Canadian Imperial Bank of Commerce, NY, 5.000%-
5.180%, 1/27/2000-3/15/2000 14,974,585
10,000,000 Credit Suisse First Boston, 5.660%, 2/2/2000 10,000,170
30,000,000 Deutsche Bank AG, 5.040%-5.940%, 1/12/2000-2/7/2000 30,000,448
10,000,000 National Westminster Bank, PLC, London, 4.980%,
1/10/2000 9,999,472
20,000,000 Rabobank Nederland, Utrecht, 5.300%, 12/16/1999 20,000,082
25,000,000 Toronto Dominion Holdings (USA), Inc., 4.990%,
1/6/2000 24,999,286
10,000,000 Westdeutsche Landesbank Girozentrale, 5.180%,
1/19/2000 10,001,690
------------
Total Certificates of Deposit 179,976,832
------------
(1) Commercial Paper--38.4%
Consumer Cyclical--1.0%
10,000,000 Walmart Stores, Inc., 5.300%, 12/7/1999 9,991,167
------------
Finance--26.3%
15,000,000 American General Finance Corp., 5.690%, 3/8/2000 14,767,658
15,000,000 Associates Corp. of North America, 5.330%-5.890%,
12/6/1999-3/16/2000 14,907,503
25,000,000 Associates First Capital Corp., 5.170%-5.705%,
12/17/1999-3/2/2000 24,819,739
30,000,000 CIT Group, Inc., 5.480%-5.730%, 12/1/1999-4/5/2000 29,797,700
20,000,000 Credit Suisse Zurich, 5.780%, 3/1/2000 19,707,789
40,000,000 General Motors Acceptance Corp., 5.310%-5.990%,
12/8/1999-2/15/2000 39,759,108
40,000,000 Household Finance Corp., 5.920%-6.050%, 1/19/2000-
2/3/2000 39,614,244
35,000,000 J.P. Morgan & Co., Inc., 5.400%-5.850%, 1/26/2000-
3/14/2000 34,621,000
40,000,000 Wells Fargo & Co., 5.850%-5.880%, 2/9/2000-
3/29/2000 39,383,767
------------
Total 257,378,508
------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
(1) Commercial Paper--continued
Finance - Automotive--4.0%
$40,000,000 Ford Motor Credit Corp., 5.070%-5.850%, 12/15/1999-
4/12/2000 $ 39,484,142
------------
Health Care--2.0%
20,000,000 Glaxo Wellcome Inc., 5.920%, 2/17/2000 19,743,467
------------
Industrial Services--3.1%
10,000,000 Rio Tinto America, Inc., 5.750%, 12/1/1999 10,000,000
20,000,000 Texaco, Inc., 5.840%-5.870%, 2/17/2000-3/22/2000 19,720,869
------------
Total 29,720,869
------------
Utilities - Electric--2.0%
20,000,000 General Electric Capital Services Corp., 5.830%,
3/20/2000 19,643,722
------------
Total Commercial Paper 375,961,875
------------
Corporate Bonds--10.2%
Banking & Finance--2.3%
1,000,000 American General Finance Corp., 5.875%, 7/1/2000 997,799
20,000,000 First Union National Bank, Charlotte, NC, 5.800%,
2/23/2000 20,000,000
1,750,000 Meridian Bancorp, Inc., 6.625%, 6/15/2000 1,754,362
------------
Total 22,752,161
------------
Finance--7.5%
20,000,000 General Electric Capital Corp., 5.730%-6.040%,
1/27/2000-5/17/2000 19,551,083
15,000,000 Prudential Funding Corp., 5.710%, 1/13/2000 14,897,696
40,000,000 Transamerica Finance Corp., 5.720%-5.900%,
1/25/2000-5/9/2000 39,311,278
------------
Total 73,760,057
------------
Technology--0.4%
3,995,000 International Business Machines Corp., 6.375%,
6/15/2000 4,002,839
------------
Total Corporate Bonds 100,515,057
------------
(1) Government Agencies--2.0%
Federal Home Loan Mortgage Corp.--1.0%
10,000,000 5.020%, Discount Notes, 12/10/1999 9,987,450
------------
Federal National Mortgage Association--1.0%
10,000,000 5.000%, Discount Notes, 12/3/1999 9,997,222
------------
Total Government Agencies 19,984,672
------------
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount
or Shares Value
- ------------------------------------------------------------------------------
<C> <S> <C>
Notes - Variable--16.9%
Banking--2.5%
$25,000,000 PNC Bank, NA, 5.310%, 3/1/2000 $ 24,998,769
------------
Banking & Finance--10.8%
30,000,000 AmSouth Bank, 5.348%, 12/15/1999 29,997,418
15,000,000 First Union National Bank, Charlotte, NC, 6.128%,
1/19/2000 15,000,000
25,000,000 Mellon Bank NA, Pittsburgh, 5.970%, 2/18/2000 24,999,206
35,000,000 SouthTrust Bank of Alabama, Birmingham, 5.325%,
2/7/2000-4/12/2000 34,997,297
------------
Total 104,993,921
------------
Chemical & Allied Products--1.5%
15,000,000 Texaco Capital, Inc., 6.011%, 2/3/2000 14,994,397
------------
Student Loan Marketing Association--2.1%
20,000,000 5.906%, 2/11/2000 19,998,538
------------
Total Notes - Variable 164,985,625
------------
Mutual Funds--3.7%
20,000,000 Aim Liquid Assets Portfolio 20,000,000
16,000,000 Federated Prime Obligations Fund 16,000,000
------------
Total Mutual Funds 36,000,000
------------
(2) Repurchase Agreements--2.6%
$ 8,506,882 Goldman Sachs Group, LP, 5.670%, dated 11/30/1999,
due 12/1/1999 8,506,882
8,518,000 Merrill Lynch, Pierce, Fenner and Smith, 5.640%,
dated 11/30/1999, due 12/1/1999 8,518,000
8,518,000 Morgan Stanley Group, Inc., 5.700%, dated
11/30/1999, due 12/1/1999 8,518,000
------------
Total Repurchase Agreements 25,542,882
------------
Total Investments, at amortized cost and value (3) $977,965,977
------------
</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) The repurchase agreements are fully collateralized by U.S. government and/or
agency obligations based on market prices at the date of the portfolio.
(3) Also represents cost for federal tax purposes.
Note: The categories of investments are shown as a percentage of net assets
($979,727,266) at November 30, 1999.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
Statement of Assets and Liabilities
November 30, 1999
<TABLE>
<S> <C> <C>
Assets:
Total investments in securities, at amortized
cost and value $977,965,977
Income receivable 6,213,615
Receivable for shares sold 4,537
------------
Total assets 984,184,129
Liabilities:
Payable for shares redeemed $ 34,467
Income distribution payable 3,887,395
Accrued expenses 535,001
-----------
Total liabilities 4,456,863
------------
Net Assets for 979,727,266 shares outstanding $979,727,266
------------
Net Asset Value, Offering Price and Redemption
Proceeds Per Share:
Institutional Shares: $365,749,632 (divided by)
365,749,632 shares outstanding $1.00
------------
Investment Shares: $613,977,634 (divided by)
613,977,634 shares outstanding $1.00
------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
Statement of Operations
Year Ended November 30, 1999
<TABLE>
<S> <C> <C>
Investment Income:
Interest $44,353,810
Expenses:
Investment adviser fee $ 4,298,578
Administrative personnel and services fee 715,029
Custodian fees 123,472
Transfer and dividend disbursing agent fees and
expenses 3,246
Directors'/Trustees' fees 14,347
Auditing fees 15,232
Legal fees 4,880
Portfolio accounting fees 1,009
Distribution services fee--Investment Shares 2,204,402
Share registration costs 89,631
Printing and postage 21,916
Insurance premiums 3,906
Miscellaneous 6,679
-----------
Total expenses 7,502,327
Waiver--
Waiver of investment adviser fee (2,031,498)
-----------
Net expenses 5,470,829
-----------
Net investment income $38,882,981
-----------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Year Ended November 30,
-------------------------------
1999 1998
- ---------------------------------------------------------------------------
<S> <C> <C>
Increase (Decrease) in Net Assets:
Operations--
Net investment income $ 38,882,981 $ 28,120,423
--------------- -------------
Distributions to Shareholders--
Distributions from net investment income
Institutional Shares (14,769,474) (9,265,013)
Investment Shares (24,113,507) (18,855,410)
--------------- -------------
Change in net assets resulting from
distributions to shareholders (38,882,981) (28,120,423)
--------------- -------------
Share Transactions--
Proceeds from sale of shares 1,434,253,801 958,837,233
Net asset value of shares issued to
shareholders in payment of distributions
declared 724,067 568,444
Cost of shares redeemed (1,118,660,397) (773,913,879)
--------------- -------------
Change in net assets resulting from share
transactions 316,317,471 185,491,798
--------------- -------------
Change in net assets 316,317,471 185,491,798
Net Assets:
Beginning of period 663,409,795 477,917,997
--------------- -------------
End of period $ 979,727,266 $ 663,409,795
--------------- -------------
</TABLE>
(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>
Year Ended November 30,
------------------------------------------------
1999 1998 1997 1996 1995
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Income from investment
operations
Net investment income 0.04 0.05 0.05 0.05 0.05
Less distributions
Distributions from net
investment income (0.04) (0.05) (0.05) (0.05) (0.05)
-------- -------- -------- -------- --------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- --------
Total return (1) 4.44% 4.92% 4.95% 4.83% 5.40%
Ratios to average net assets
Expenses 0.78% 0.78% 0.78% 0.77% 0.72%
Net investment income 4.38% 4.80% 4.85% 4.74% 5.27%
Expense waiver/reimbursement
(2) 0.24% 0.26% 0.28% 0.32% 0.40%
Supplemental data
Net assets, end of period
(000 omitted) $613,978 $482,128 $320,480 $230,263 $165,636
</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) This contractual expense decrease is reflected in both the expense and net
investment income ratios shown above.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--99.5%
Alabama--10.1%
$ 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
9,700,000 The Board of Trustees of the University of Alabama,
University & College Improvements (Series B) Weekly
VRDNs 9,700,000
375,000 Tuscaloosa County, AL, Port Authority, (Series
1989A) Weekly VRDNs (Capstone Hotel
Ltd.)/(SouthTrust Bank of Alabama, Birmingham LOC) 375,000
------------
Total 37,295,000
------------
California--1.4%
5,000,000 Los Angeles County, CA, (Series A), 4.00% TRANs,
6/30/2000 5,019,051
------------
Colorado--1.3%
5,000,000 Arapahoe County, CO, School District 005, GO UT, 4.25% Bonds,
6/30/2000 5,014,956
------------
Delaware--1.2%
4,455,000 Delaware State, GO UT, Public Improvement Refunding
Bonds (Series A), 4.50% Bonds, 2/1/2000 4,466,683
------------
Florida--7.9%
100,000 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) 100,038
5,000,000 Broward County, FL, HFA, Revenue Bonds Weekly VRDNs
(Welleby Apartments) 5,000,000
6,600,000 Collier County, FL, HFA, Multi-family Revenue Bonds
(Series 1985) Weekly VRDNs (River Reach Project) 6,600,000
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
Florida--continued
$ 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)/(Banque 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.)/(Rabobank
Nederland, Utrecht LOC) 1,000,000
4,500,000 Southeast Volusia Hospital District, FL, Revenue
Bonds (Series 1995) Weekly VRDNs (Bert Fish Medical
Center (FL))/(SouthTrust Bank of Alabama,
Birmingham LOC) 4,500,000
7,000,000 St. Lucie County, FL, PCR, 3.55% CP, Mandatory
Tender 12/8/1999 7,000,000
------------
Total 29,230,038
------------
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
4,450,000 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) 4,449,999
2,900,000 Lowndes County, GA, Residential Care Facilities for
the Elderly Authority Weekly VRDNs (South Georgia
Health Alliance Project) 2,900,000
770,000 Macon-Bibb County, GA, Urban Development Authority,
Refunding Revenue Bonds (Series 1995) Weekly VRDNs
(Macon Hotel Investors)/(Bank One, Michigan LOC) 770,000
500,000 Monroe County, GA, Development Authority IDRB,
Refunding Revenue Bonds Weekly VRDNs (Forsyth Inns,
Inc.)/(Bank One, Michigan LOC) 500,000
5,120,000 Richmond County, GA, Board of Education, GO UT
Refunding Bonds, 4.50% Bonds, 3/1/2000 5,139,811
------------
Total 22,359,810
------------
Idaho--1.4%
5,000,000 Idaho State, 4.25% Bonds, 6/30/2000 5,023,785
------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
Illinois--8.0%
$11,800,000 Illinois Development Finance Authority Weekly VRDNs $ 11,800,000
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
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 29,620,000
------------
Iowa--1.3%
5,000,000 Iowa School Corporations, (Series B), 3.50% Bonds
(FSA LOC), 1/28/2000 5,004,084
------------
Kentucky--5.6%
500,000 Georgetown, KY, Educational Institution, Revenue
Bonds Weekly VRDNs (Georgetown College) 500,000
20,000,000 Kentucky Interlocal School Transportation
Association, 4.00% Bonds, 6/30/2000 20,055,875
------------
Total 20,555,875
------------
Louisiana--1.2%
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
------------
Massachusetts--4.5%
10,000,000 Commonwealth of Massachusetts, (Series B) Weekly
VRDNs (Toronto-Dominion Bank LOC) 10,000,000
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
Massachusetts--continued
$ 100,000 Massachusetts HEFA, (Series P1) 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 16,600,000
------------
Mississippi--0.6%
2,340,000 Jackson County, MS, 2.90% TOBs (Chevron Corp. GTD)
11/1/2004 2,340,000
------------
Missouri--0.5%
1,800,000 Kansas City, MO, IDA, IDRB, Weekly VRDNs (Mid-
American Health Services) 1,800,000
------------
New Mexico--2.2%
8,000,000 New Mexico State, Revenue Notes, 4.00% Bonds,
6/30/2000 8,034,524
------------
New York--6.5%
10,000,000 Long Island Power Authority, NY, Revenue Bonds
Weekly VRDNs (Credit Suisse First Boston and MBIA
LOCs) 10,000,000
6,510,000 Monroe County, NY, GO UT Refunding Bonds, 5.00%
Bonds, 3/1/2000 6,543,110
100,000 New York City, NY, (Subseries B4) Daily VRDNs (MBIA INS)/(National
Westminster Bank, PLC, London LIQ) 100,000
2,850,000 New York City, NY, GO UT Bonds Daily VRDNs 2,850,000
4,300,000 New York City, NY, GO UT Refunding Bonds (Subseries
E3)
Daily VRDNs 4,300,000
100,000 New York City, NY, (Subseries E2) Daily VRDNs
(Morgan Guaranty Trust Co., New York LOC) 100,000
------------
Total 23,893,110
------------
North Carolina--0.9%
1,500,000 Alamance County, NC, Industrial Facilities &
Pollution Control Financing Authority, Revenue
Bonds Weekly VRDNs (SCI Systems, Inc.) 1,500,000
1,900,000 North Carolina Educational Facilities Finance
Agency Weekly VRDNs (Gardner Webb
University)/(First Union National Bank, Charlotte,
NC LOC) 1,900,000
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
North Carolina--continued
$ 115,000 North Carolina Medical Care Commission, Revenue
Bonds
(Series A) Weekly VRDNs (Pooled Financing Program) $ 115,000
------------
Total 3,515,000
------------
Ohio--5.1%
930,000 Centerville, OH, Health Care Revenue Bonds Weekly
VRDNs (Bethany Lutheran Village) 930,000
18,000,000 Lorain County, OH, (Series A), 3.55% CP, Mandatory
Tender 12/8/1999 18,000,000
------------
Total 18,930,000
------------
Oklahoma--1.2%
4,300,000 Tulsa County, OK, Independent School District 1,
School Improvements, 5.00% Bonds, 2/1/2000 4,314,532
------------
Oregon--5.0%
13,500,000 Oregon State, Veteran's Welfare Bonds (Series 73E)
Weekly VRDNs (Morgan Guaranty Trust Co., New York
LOC) 13,500,000
5,000,000 Oregon State, Veteran's Welfare Bonds (Series 73F)
Weekly VRDNs (Morgan Guaranty Trust Co., New York
LOC) 5,000,000
------------
Total 18,500,000
------------
Pennsylvania--1.3%
4,700,000 Allegheny County, PA, IDA, Revenue Bonds (Series A)
Weekly VRDNs (United Jewish Federation of Greater
Pittsburgh VRDB)/(PNC Bank, NA LOC) 4,700,000
------------
Tennessee--5.2%
4,150,000 Clarksville, TN, Public Building Authority,
Adjustable Rate Pooled Financing Revenue Bonds
(Series 1997) Weekly VRDNs (Tennessee Municipal
Bond Fund)/(Bank of America, NA, Charlotte LOC) 4,150,000
1,200,000 Clarksville, TN, Public Building Authority, Public
Improvement Revenue Bonds Weekly VRDNs 1,200,000
7,395,000 Knox County, TN, GO UT Refunding Bonds, 4.50%
Bonds, 3/1/2000 7,423,614
4,600,000 Metropolitan Nashville, TN AA, (Series 1993) Weekly
VRDNs (FGIC INS)/(Societe Generale, Paris
LIQ)/(Societe Generale, Paris LOC) 4,600,000
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
Tennessee--continued
$ 2,000,000 Montgomery Co, TN, Public Building Authority Weekly
VRDNs $ 2,000,000
------------
Total 19,373,614
------------
Texas--6.8%
10,600,000 Lower Neches Valley, TX, Refunding Revenue Bonds,
3.45% TOBs (Chevron U.S.A., Inc.), Optional Tender
2/16/2000 10,600,000
3,800,000 Richardson, TX, Independent School District,
(Series A) Weekly VRDNs (PSFG GTD)/(Union Bank of
Switzerland, Zurich SA) 3,800,000
10,500,000 Texas State, GO UT, 7.125% Bonds, 4/1/2000
(Callable @102) 10,720,853
------------
Total 25,120,853
------------
Virginia--1.8%
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% Bonds,
2/1/2000 6,211,382
------------
Total 6,511,382
------------
Washington--3.8%
14,000,000 Port Anacortes, WA Industrial Development Corp.
VRDNs
(Texaco, Inc.) 14,000,000
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 14,099,998
------------
West Virginia--1.6%
5,900,000 West Virginia State Hospital Finance Authority,
(Series A) Weekly VRDNs (Oak Hill, WV)/(Bank One,
NA COL) 5,900,000
------------
Wisconsin--7.1%
19,000,000 Wisconsin Health and Educational Facilities
Authority, (Series A) Revenue Bonds Weekly VRDNs
(Felician Health Care, Inc.)/(AMBAC INS) 19,000,000
7,320,000 Wisconsin State Health Facilities Authority,
Revenue Bonds
(Series A2) Weekly VRDNs (Franciscan Health Care) 7,320,000
------------
Total 26,320,000
------------
Total Short-Term Municipals 368,042,295
------------
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Shares Value
- -----------------------------------------------------------------------------
<C> <S> <C>
Mutual Funds--0.2%
612,207 AIM Global Management Short Term Investments Money
Market Fund $ 612,207
881 Dreyfus Tax Exempt Money Market Fund 880
346 Federated Investors Tax-Free Obligations Fund 346
59,368 Fidelity Tax Exempt Money Market Fund 59,368
------------
Total 672,801
------------
Total Investments, at amortized cost and value (1) $368,715,096
------------
</TABLE>
(1) Also represents cost for federal tax purposes.
Note: The categories of investments are shown as a percentage of net assets
($369,902,924) at November 30, 1999.
The following acronyms are used throughout this portfolio:
<TABLE>
<S> <C>
AMBAC--American Municipal Bond Assurance INS--Insured
Corporation LIQ--Liquidity Agreement
COL--Collateralized LOC--Letter 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
HEFA--Health and Education Facilities TOBs--Tender Option Bonds
Authority TRANs--Tax and Revenue Anticipation
HFA--Housing Finance Authority Notes
IDA--Industrial Development Authority UT--Unlimited Tax
IDB--Industrial Development Bond VRDB--Variable Rate Demand Bond
IDRB--Industrial Development Revenue Bond VRDNs--Variable Rate Demand Notes
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
Statement of Assets and Liabilities
November 30, 1999
<TABLE>
<S> <C> <C>
Assets:
Total investments in securities, at amortized cost
and value $368,715,096
Income receivable 2,376,025
------------
Total assets 371,091,121
Liabilities:
Income distribution payable $1,044,135
Accrued expenses 144,062
----------
Total liabilities 1,188,197
------------
Net Assets for 369,902,924 shares outstanding $369,902,924
------------
Net Asset Value, Offering Price and Redemption
Proceeds Per Share:
Institutional Shares: $225,466,430 (divided by)
225,466,430 shares outstanding $1.00
------------
Investment Shares: $144,436,494 (divided by)
144,436,494 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
Year Ended November 30, 1999
<TABLE>
<S> <C> <C>
Investment Income:
Interest $13,418,639
Expenses:
Investment adviser fee $ 2,104,651
Administrative personnel and services fee 353,303
Custodian fees 75,640
Transfer and dividend disbursing agent fees and
expenses 12,568
Directors'/Trustees' fees 9,246
Auditing fees 15,208
Legal fees 6,529
Portfolio accounting fees 892
Distribution services fee--Investment Shares 606,130
Share registration costs 12,703
Printing and postage 21,104
Insurance premiums 2,998
Miscellaneous 15,742
-----------
Total expenses 3,236,714
Waiver of investment adviser fee (1,626,095)
-----------
Net expenses 1,610,619
-----------
Net investment income $11,808,020
-----------
</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>
Year Ended November 30,
----------------------------
1999 1998
- -------------------------------------------------------------------------
<S> <C> <C>
Increase (Decrease) in Net Assets:
Operations--
Net investment income $ 11,808,020 $ 11,680,208
------------- -------------
Distributions to Shareholders--
Distributions from net investment income
Institutional Shares (7,932,704) (8,367,231)
Investment Shares (3,875,316) (3,312,977)
------------- -------------
Change in net assets resulting from
distributions
to shareholders (11,808,020) (11,680,208)
------------- -------------
Share Transactions--
Proceeds from sale of shares 671,733,491 743,274,021
Cost of shares redeemed (710,364,176) (603,065,021)
------------- -------------
Change in net assets resulting from share
transactions (38,630,685) 140,209,000
------------- -------------
Change in net assets (38,630,685) 140,209,000
Net Assets:
Beginning of period 408,533,609 268,324,609
------------- -------------
End of period $ 369,902,924 $ 408,533,609
------------- -------------
</TABLE>
(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>
Year Ended November 30,
-------------------------------------------------
1999 1998 1997 1996 1995
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Income from investment
operations
Net investment income 0.03 0.03 0.03 0.03 0.03
Less distributions
Distributions from net
investment income (0.03) (0.03) (0.03) (0.03) (0.03)
-------- -------- -------- -------- --------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- --------
Total return (1) 2.58% 2.88% 2.99% 2.83% 3.25%
Ratios to average net assets
Expenses 0.64% 0.64% 0.64% 0.69% 0.66%
Net investment income 2.56% 2.83% 2.93% 2.84% 3.19%
Expense waiver/reimbursement
(2) 0.39% 0.41% 0.45% 0.43% 0.52%
Supplemental data
Net assets, end of period
(000 omitted) $144,436 $133,211 $85,852 $74,922 $55,733
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.
(2) This contractual expense decrease is reflected in both the expense and the
net investment income ratios shown above.
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia U.S. Treasury Money Market Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Principal
Amount
or Shares Value
- -------------------------------------------------------------------------------
<C> <S> <C>
U.S. Government Obligations--43.8%
U.S. Treasury Bills--4.1%
$ 27,500,000 12/9/1999-1/20/2000 $ 27,363,596
------------
U.S. Treasury Notes--39.7%
260,000,000 5.375%-6.875%, 12/31/1999-6/30/2000 260,534,828
------------
Total U.S. Government Obligations 287,898,424
------------
(1) Repurchase Agreements--54.1%
30,000,000 First Boston, 5.600%, dated 11/30/1999, due
12/1/1999 30,000,000
146,809,289 Goldman Sachs Group, LP, 5.600%, dated 11/30/1999,
due 12/1/1999 146,809,288
30,000,000 Merrill Lynch, Pierce, Fenner and Smith, 5.640%,
dated 11/30/1999, due 12/1/1999 30,000,000
148,809,289 Morgan Stanley Group, Inc., 5.650%, dated
11/30/1999, due 12/1/1999 148,809,289
------------
Total Repurchase Agreements 355,618,577
------------
Mutual Fund--2.0%
13,000,000 Federated Treasury Obligations Fund 13,000,000
------------
Total Investments, at amortized cost and value (2) $656,517,001
------------
</TABLE>
(1) The repurchase agreements are fully collateralized by U.S. Treasury
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
($656,779,427) at November 30, 1999.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia U.S. Treasury Money Market Fund
Statement of Assets and Liabilities
November 30, 1999
<TABLE>
<S> <C> <C>
Assets:
Investments in repurchase agreements $ 355,618,577
Investments in securities 300,898,424
-------------
Total investments in securities, at amortized cost
and value $656,517,001
Income receivable 3,213,574
------------
Total assets 659,730,575
Liabilities:
Income distribution payable 2,732,724
Accrued expenses 218,424
-------------
Total liabilities 2,951,148
------------
Net Assets for 656,779,427 shares outstanding $656,779,427
------------
Net Asset Value, Offering Price and Redemption
Proceeds Per Share:
Institutional Shares: ($448,758,441 (divided by)
448,758,441 shares outstanding) $1.00
------------
Investment Shares: ($208,020,986 (divided by)
208,020,986 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
Year Ended November 30, 1999
<TABLE>
<S> <C> <C>
Investment Income:
Interest $33,485,781
Expenses:
Investment adviser fee $ 3,415,568
Administrative personnel and services fee 573,461
Custodian fees 105,818
Transfer and dividend disbursing agent fees and
expenses 7,654
Directors'/Trustees' fees 16,064
Auditing fees 14,981
Legal fees 6,107
Portfolio accounting fees 3,142
Distribution services fee--Investment Shares 789,762
Share registration costs 25,669
Printing and postage 29,977
Insurance premiums 3,703
Miscellaneous 9,920
-----------
Total expenses 5,001,826
Waiver of investment adviser fee (2,576,070)
-----------
Net expenses 2,425,756
-----------
Net investment income $31,060,025
-----------
</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>
Year Ended November 30,
--------------------------
1999 1998
- -----------------------------------------------------------------------------
<S> <C> <C>
Increase (Decrease) in Net Assets:
Operations--
Net investment income $ 31,060,025 $ 34,194,612
--------------- ---------------
Distributions to Shareholders--
Distributions from net investment income
Institutional Shares (22,602,956) (27,082,585)
Investment Shares (8,457,069) (7,112,027)
--------------- ---------------
Change in net assets resulting from
distributions
to shareholders (31,060,025) (34,194,612)
--------------- ---------------
Share Transactions--
Proceeds from sale of shares 1,484,059,570 1,496,501,247
Net asset value of shares issued to
shareholders in payment of distributions
declared 39,796 27,832
Cost of shares redeemed (1,492,629,325) (1,459,037,222)
--------------- ---------------
Change in net assets resulting from share
transactions (8,529,959) 37,491,857
--------------- ---------------
Change in net assets (8,529,959) 37,491,857
Net Assets:
Beginning of period 665,309,386 627,817,529
--------------- ---------------
End of period $ 656,779,427 $ 665,309,386
--------------- ---------------
</TABLE>
(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>
Year Ended November 30,
-------------------------------------------------
1999 1998 1997 1996 1995
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Income from investment
operations
Net investment income 0.04 0.05 0.05 0.04 0.05
Less distributions
Distributions from net
investment income (0.04) (0.05) (0.05) (0.04) (0.05)
-------- -------- -------- -------- --------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- --------
Total return (1) 4.35% 4.83% 4.89% 4.77% 5.30%
Ratios to average net assets
Expenses 0.64% 0.63% 0.64% 0.70% 0.66%
Net investment income 4.28% 4.74% 4.80% 4.68% 5.21%
Expense waiver/reimbursement
(2) 0.38% 0.40% 0.41% 0.39% 0.46%
Supplemental data
Net assets, end of period
(000 omitted) $208,021 $198,771 $117,495 $104,336 $81,739
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.
(2) This contractual expense decrease is reflected in both the expense and the
net investment income ratios shown above.
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Funds
Combined Notes to Financial Statements
November 30, 1999
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 fifteen portfolios. The following portfolios are included
herein (individually referred to as the "Fund", or collectively as the "Funds"):
<TABLE>
<CAPTION>
Portfolio Investment Objective
- ---------------------------------------------------------------------------------
<S> <C>
Wachovia Money Market Fund To provide current income consistent with ("Money
Market Fund") 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 with
Fund ("U.S. Treasury Fund") 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. The Trust offers
multiple classes of shares, which differ in their respective distribution and
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Funds
service fees. All shareholders bear the common expenses of the Funds based on
average daily net assets of each class, without distinction between share
classes. Dividends are declared separately for each class. No class has
preferential dividend rights; differences in per share dividend rates are
generally due to differences in separate class expenses.
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.
Losses may occur on these transactions due to changes in market conditions or
the failure of counterparties to perform under the contract.
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 a trade date basis.
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.
Transactions in shares were as follows:
<TABLE>
<CAPTION>
Money Market Fund Tax-Free Fund U.S. Treasury Fund
-------------------------- -------------------------- ------------------------------
Year Ended November 30, Year Ended November 30, Year Ended November 30,
1999 1998 1999 1998 1999 1998
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Institutional Shares
- -----------------------
Shares sold 699,311,820 369,619,728 307,834,572 367,947,784 1,142,479,883 1,162,773,272
Shares redeemed (514,844,082) (345,776,210) (357,690,587) (275,098,274) (1,160,259,358) (1,206,558,183)
- ----------------------- ------------ ------------ ------------ ------------ -------------- --------------
Net change resulting
from Institutional
Shares transactions 184,467,738 23,843,518 (49,856,015) 92,849,510 (17,779,475) (43,784,911)
------------ ------------ ------------ ------------ -------------- --------------
Investment Shares
- -----------------------
Shares sold 734,941,981 589,217,508 363,898,919 375,326,237 341,579,687 333,727,978
Shares issued to
shareholders in payment
of distributions
declared 724,067 568,441 -- -- 39,796 27,829
Shares redeemed (603,816,315) (428,137,669) (352,673,589) (327,966,747) (332,369,967) (252,479,039)
- ----------------------- ------------ ------------ ------------ ------------ -------------- --------------
Net change resulting
from Investment Shares
transactions 131,849,733 161,648,280 11,225,330 47,359,490 9,249,516 81,276,768
------------ ------------ ------------ ------------ -------------- --------------
Net change resulting
from share transactions 316,317,471 185,491,798 (38,630,685) 140,209,000 (8,529,959) 37,491,857
- ----------------------- ------------ ------------ ------------ ------------ -------------- --------------
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Funds
4. Investment Adviser Fee and Other Transactions with Affiliates
Investment Adviser Fee--Wachovia Asset Management, a subsidiary of Wachovia Bank
N.A. and the Funds' investment adviser (the "Adviser"), receives for its
services an annual investment adviser 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
voluntary waiver at its sole discretion at any time after January 31, 2001.
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 Cash
Management Fund) and The Wachovia Municipal Funds for the period. FServ may
voluntarily waive a portion of its 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 of the Trust are Officers and Directors or
Trustees of the above companies.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Report of Ernst & Young LLP, Independent Auditors
To the Trustees and Shareholders of THE WACHOVIA FUNDS:
We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of Wachovia Money Market Fund, Wachovia Tax-Free
Money Market Fund, and Wachovia U.S. Treasury Money Market Fund (three of the
portfolios constituting The Wachovia Funds) as of November 30, 1999, and the
related statements of operations for the year then ended, the statements of
changes in net assets for each of the two years in the period then ended and the
financial highlights for each of the five years in the period then ended. These
financial statements and financial highlights are the responsibility of the
Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of securities
owned as of November 30, 1999, by correspondence with the custodian. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Wachovia Money Market Fund, Wachovia Tax-Free Money Market Fund, and Wachovia
U.S. Treasury Money Market Fund of The Wachovia Funds at November 30, 1999, and
the results of their operations for the year then ended, changes in their net
assets for each of the two years in the period then ended, and the financial
highlights for each of the five years in the period then ended, in conformity
with accounting principles generally accepted in the United States.
/s/ Ernst & Young LLP
Boston, Massachusetts
January 17, 2000
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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
Charles S. Way, Jr. Treasurer
Alvin J. Schexnider Gail Cagney
Secretary
Peter J. Germain
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. Although money market funds seek to maintain a
stable net asset value of $1.00 per share, there is no assurance that they will
be able to do so.
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.
Cusip 929901203
Cusip 929901304
Cusip 929901403
Cusip 929901833
Federated Securities Corp., Distributor Cusip 929901825
831-21 (1/00) G01512-16 (1/00)
WACHOVIA MONEY MARKET FUND
INSTITUTIONAL SHARES
Annual Report
November 30, 1999
[wachovia logo]
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
(1) Bank Notes--7.7%
Banking & Finance--7.7%
$30,000,000 Bank of America, NA, 5.850%-5.870%, 1/20/2000-
4/19/2000 $ 30,000,000
10,000,000 Bank of America, NC, 6.000%, 3/22/2000 10,000,000
25,000,000 First National Bank of Chicago, 5.850%, 2/24/2000 25,000,575
10,000,000 LaSalle National Bank, Chicago, 5.130%, 4/25/2000 9,998,459
------------
Total Bank Notes 74,999,034
------------
(1) Certificates of Deposit--18.4%
Banking & Finance--18.4%
20,000,000 ABN AMRO Bank NV, Amsterdam, 5.860%, 5/23/2000 20,000,000
40,000,000 Bayerische Landesbank Girozentrale, 5.850%-5.870%,
3/9/2000-3/15/2000 40,001,099
15,000,000 Canadian Imperial Bank of Commerce, NY, 5.000%-
5.180%, 1/27/2000-3/15/2000 14,974,585
10,000,000 Credit Suisse First Boston, 5.660%, 2/2/2000 10,000,170
30,000,000 Deutsche Bank AG, 5.040%-5.940%, 1/12/2000-2/7/2000 30,000,448
10,000,000 National Westminster Bank, PLC, London, 4.980%,
1/10/2000 9,999,472
20,000,000 Rabobank Nederland, Utrecht, 5.300%, 12/16/1999 20,000,082
25,000,000 Toronto Dominion Holdings (USA), Inc., 4.990%,
1/6/2000 24,999,286
10,000,000 Westdeutsche Landesbank Girozentrale, 5.180%,
1/19/2000 10,001,690
------------
Total Certificates of Deposit 179,976,832
------------
(1) Commercial Paper--38.4%
Consumer Cyclical--1.0%
10,000,000 Walmart Stores, Inc., 5.300%, 12/7/1999 9,991,167
------------
Finance--26.3%
15,000,000 American General Finance Corp., 5.690%, 3/8/2000 14,767,658
15,000,000 Associates Corp. of North America, 5.330%-5.890%,
12/6/1999-3/16/2000 14,907,503
25,000,000 Associates First Capital Corp., 5.170%-5.705%,
12/17/1999-3/2/2000 24,819,739
30,000,000 CIT Group, Inc., 5.480%-5.730%, 12/1/1999-4/5/2000 29,797,700
20,000,000 Credit Suisse Zurich, 5.780%, 3/1/2000 19,707,789
40,000,000 General Motors Acceptance Corp., 5.310%-5.990%,
12/8/1999-2/15/2000 39,759,108
40,000,000 Household Finance Corp., 5.920%-6.050%, 1/19/2000-
2/3/2000 39,614,244
35,000,000 J.P. Morgan & Co., Inc., 5.400%-5.850%, 1/26/2000-
3/14/2000 34,621,000
40,000,000 Wells Fargo & Co., 5.850%-5.880%, 2/9/2000-
3/29/2000 39,383,767
------------
Total 257,378,508
------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
(1) Commercial Paper--continued
Finance - Automotive--4.0%
$40,000,000 Ford Motor Credit Corp., 5.070%-5.850%, 12/15/1999-
4/12/2000 $ 39,484,142
------------
Health Care--2.0%
20,000,000 Glaxo Wellcome Inc., 5.920%, 2/17/2000 19,743,467
------------
Industrial Services--3.1%
10,000,000 Rio Tinto America, Inc., 5.750%, 12/1/1999 10,000,000
20,000,000 Texaco, Inc., 5.840%-5.870%, 2/17/2000-3/22/2000 19,720,869
------------
Total 29,720,869
------------
Utilities - Electric--2.0%
20,000,000 General Electric Capital Services Corp., 5830%,
3/20/2000 19,643,722
------------
Total Commercial Paper 375,961,875
------------
Corporate Bonds--10.2%
Banking & Finance--2.3%
1,000,000 American General Finance Corp., 5.875%, 7/1/2000 997,799
1,750,000 Meridian Bancorp, Inc., 6.625%, 6/15/2000 1,754,362
20,000,000 First Union National Bank, Charlotte, NC, 5.800%,
2/23/2000 20,000,000
------------
Total 22,752,161
------------
Finance--7.5%
15,000,000 Prudential Funding Corp., 5.710%, 1/13/2000 14,897,696
20,000,000 General Electric Capital Corp., 5.730%-6.040%,
1/27/2000-5/17/2000 19,551,083
40,000,000 Transamerica Finance Corp., 5.720%-5.900%,
1/25/2000-5/9/2000 39,311,278
------------
Total 73,760,057
------------
Technology--0.4%
3,995,000 International Business Machines Corp., 6.375%,
6/15/2000 4,002,839
------------
Total Corporate Bonds 100,515,057
------------
(1) Government Agencies--2.0%
Federal Home Loan Mortgage Corp.--1.0%
10,000,000 5.020%, Discount Notes, 12/10/1999 9,987,450
------------
Federal National Mortgage Association--1.0%
10,000,000 5.000%, Discount Notes, 12/3/1999 9,997,222
------------
Total Government Agencies 19,984,672
------------
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount
or Shares Value
- ------------------------------------------------------------------------------
<C> <S> <C>
Notes - Variable--16.9%
Banking--2.5%
$25,000,000 PNC Bank, NA, 5.310%, 3/1/2000 $ 24,998,769
------------
Banking & Finance--10.8%
30,000,000 AmSouth Bank, 5.348%, 12/15/1999 29,997,418
15,000,000 First Union National Bank, Charlotte, NC, 6.128%,
1/19/2000 15,000,000
25,000,000 Mellon Bank NA, Pittsburgh, 5.970%, 2/18/2000 24,999,206
35,000,000 SouthTrust Bank of Alabama, Birmingham, 5.325%,
2/7/2000-4/12/2000 34,997,297
------------
Total 104,993,921
------------
Chemical & Allied Products--1.5%
15,000,000 Texaco Capital, Inc., 6.011%, 2/3/2000 14,994,397
------------
Student Loan Marketing Association--2.1%
20,000,000 5.906%, 2/11/2000 19,998,538
------------
Total Notes - Variable 164,985,625
------------
Mutual Funds--3.7%
20,000,000 Aim Liquid Assets Portfolio 20,000,000
16,000,000 Federated Prime Obligations Fund 16,000,000
------------
Total Mutual Funds 36,000,000
------------
(2) Repurchase Agreements--2.6%
$ 8,506,882 Goldman Sachs Group, LP, 5.670%, dated 11/30/1999,
due 12/1/1999 8,506,882
8,518,000 Merrill Lynch, Pierce, Fenner and Smith, 5.640%,
dated 11/30/1999, due 12/1/1999 8,518,000
8,518,000 Morgan Stanley Group, Inc., 5.700%, dated
11/30/1999, due 12/1/1999 8,518,000
------------
Total Repurchase Agreements 25,542,882
------------
Total Investments, at amortized cost and value (3) $977,965,977
------------
</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) The repurchase agreements are fully collateralized by U.S. government and/or
agency obligations based on market prices at the date of the portfolio.
(3) Also represents cost for federal tax purposes.
Note: The categories of investments are shown as a percentage of net assets
($979,727,266) at November 30, 1999.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
Statement of Assets and Liabilities
November 30, 1999
<TABLE>
<S> <C> <C>
Assets:
Total investments in securities, at amortized cost and value $977,965,977
Income receivable 6,213,615
Receivable for shares sold 4,537
------------
Total assets 984,184,129
Liabilities:
Payable for shares redeemed $ 34,467
Income distribution payable 3,887,395
Accrued expenses 535,001
-----------
Total liabilities 4,456,863
------------
Net Assets for 979,727,266 shares outstanding $979,727,266
------------
Net Asset Value, Offering Price and Redemption Proceeds Per Share:
Institutional Shares: $365,749,632 / 365,749,632 shares outstanding $1.00
------------
Investment Shares: $613,977,634 / 613,977,634 shares outstanding $1.00
------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
Statement of Operations
Year Ended November 30, 1999
<TABLE>
<S> <C> <C>
Investment Income:
Interest $44,353,810
Expenses:
Investment adviser fee $ 4,298,578
Administrative personnel and services fee 715,029
Custodian fees 123,472
Transfer and dividend disbursing agent fees and
expenses 3,246
Directors'/Trustees' fees 14,347
Auditing fees 15,232
Legal fees 4,880
Portfolio accounting fees 1,009
Distribution services fee--Investment Shares 2,204,402
Share registration costs 89,631
Printing and postage 21,916
Insurance premiums 3,906
Miscellaneous 6,679
-----------
Total expenses 7,502,327
Waiver--
Waiver of investment adviser fee (2,031,498)
-----------
Net expenses 5,470,829
-----------
Net investment income $38,882,981
-----------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Money Market Fund
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Year Ended November 30,
------------------------------
1999 1998
- ---------------------------------------------------------------------------
<S> <C> <C>
Increase (Decrease) in Net Assets:
Operations--
Net investment income $ 38,882,981 $ 28,120,423
--------------- -------------
Distributions to Shareholders--
Distributions from net investment income
Institutional Shares (14,769,474) (9,265,013)
Investment Shares (24,113,507) (18,855,410)
--------------- -------------
Change in net assets resulting from
distributions to shareholders (38,882,981) (28,120,423)
--------------- -------------
Share Transactions--
Proceeds from sale of shares 1,434,253,801 958,837,233
Net asset value of shares issued to
shareholders in payment of distributions
declared 724,067 568,444
Cost of shares redeemed (1,118,660,397) (773,913,879)
--------------- -------------
Change in net assets resulting from share
transactions 316,317,471 185,491,798
--------------- -------------
Change in net assets 316,317,471 185,491,798
Net Assets:
Beginning of period 663,409,795 477,917,997
--------------- -------------
End of period $ 979,727,266 $ 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>
Year Ended November 30,
-------------------------------------------------
1999 1998 1997 1996 1995
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Income from investment
operations
Net investment income 0.05 0.05 0.05 0.05 0.06
Less distributions
Distributions from net
investment income (0.05) (0.05) (0.05) (0.05) (0.06)
-------- -------- -------- -------- --------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- --------
Total return (1) 4.86% 5.33% 5.37% 5.25% 5.75%
Ratios to average net assets
Expenses 0.38% 0.38% 0.38% 0.37% 0.38%
Net investment income 4.79% 5.20% 5.24% 5.14% 5.61%
Expense waiver/reimbursement
(2) 0.24% 0.26% 0.28% 0.32% 0.34%
Supplemental data
Net assets, end of period
(000 omitted) $365,750 $181,282 $157,438 $135,748 $126,042
</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) This contractual expense decrease is reflected in both the expense and net
investment income ratios shown above.
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Fund
Notes to Financial Statements
November 30, 1999
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 fifteen 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. Investments
in other open-end regulated investment companies are valued at net asset
value.
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. The Fund offers multiple
classes of shares, which differ in their respective distribution and service
fees. All shareholders bear the common expenses of the Fund based on average
daily net assets of each class, without distinction between share classes.
Dividends are declared separately for each class. No class has preferential
dividend rights; differences in per share dividend rates are generally due to
differences in separate class expenses.
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
provision for federal tax is 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.
Losses may occur on these transactions due to changes in market conditions or
the failure of counterparties to perform under the contract.
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 a trade date basis.
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.
Transactions in shares were as follows:
<TABLE>
<CAPTION>
Year Ended November 30,
---------------------------
1999 1998
- ----------------------------------------------------------------------------
<S> <C> <C>
Institutional Shares
Shares sold 699,311,820 369,619,728
Shares redeemed (514,844,082) (345,776,210)
------------ ------------
Net change resulting from Institutional Shares
transactions 184,467,738 23,843,518
------------ ------------
</TABLE>
<TABLE>
<CAPTION>
Year Ended November 30,
---------------------------
1999 1998
- -----------------------------------------------------------------------------
<S> <C> <C>
Investment Shares
Shares sold 734,941,981 589,217,508
Shares issued to shareholders in payment of
distributions declared 724,067 568,441
Shares redeemed (603,816,315) (428,137,669)
------------ ------------
Net change resulting from Investment Shares
transactions 131,849,733 161,648,280
------------ ------------
Net change resulting from Shares transactions 316,317,471 185,491,798
------------ ------------
</TABLE>
4. Investment Adviser Fee and Other Transactions with Affiliates
Investment Adviser Fee--Wachovia Asset Management, a subsidiary of Wachovia Bank
N.A. and the Fund's investment adviser (the "Adviser"), receives for its
services an annual investment adviser 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 at any time after January 31, 2001.
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.
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
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 of the Trust are Officers and Directors or
Trustees of the above companies.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Report of Ernst & Young LLP, Independent Auditors
To the Trustees of The Wachovia Funds and Shareholders of WACHOVIA MONEY MARKET
FUND:
We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of Wachovia Money Market Fund (one of the
portfolios constituting The Wachovia Funds) as of November 30, 1999, and the
related statement of operations for the year then ended, the statement of
changes in net assets for each of the two years in the period then ended and
financial highlights for each of the five years in the period then ended. These
financial statements and financial highlights are the responsibility of the
Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of securities
owned as of November 30, 1999, by correspondence with the custodian. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Wachovia Money Market Fund of The Wachovia Funds at November 30, 1999, the
results of its operations for the year then ended, the changes in its net assets
for each of the two years in the period then ended, and the financial highlights
for each of the five years in the period then ended, in conformity with
accounting principles generally accepted in the United States.
/s/ Ernst & Young LLP
Boston, Massachusetts
January 17, 2000
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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
Charles S. Way, Jr. Treasurer
Alvin J. Schexnider Gail Cagney
Secretary
Peter J. Germain
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. Although money market funds seek to maintain a
stable net asset value of $1.00 per share, there is no assurance that they will
be able to do so.
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.
Federated Securities Corp., Distributor
831-16 (1/00)
Cusip 929901106
Cusip 929901205
G01512-05 (1/00)
WACHOVIA PRIME CASH
MANAGEMENT FUND
WACHOVIA TAX-FREE
MONEY MARKET FUND
WACHOVIA U.S. TREASURY
MONEY MARKET FUND
INSTITUTIONAL SHARES
Annual Report
November 30, 1999
[LOGO OF WACHOVIA FUNDS]
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Prime Cash Management Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
(1) Bank Notes--6.1%
$35,000,000 Bank of America, 5.510%-5.810%, 1/19/2000-
2/24/2000 $ 35,000,000
25,000,000 Bank One, NA, 5.850%, 2/24/2000 25,000,575
10,000,000 First Union Bank, 5.800%, 2/23/2000 10,000,000
20,000,000 LaSalle National Bank, Chicago, 5.130%, 4/25/2000 19,996,919
15,000,000 Morgan Guaranty Trust Co., NY, 5.530%, 1/20/2000 15,000,000
--------------
Total Bank Notes 104,997,494
--------------
(1) Time Deposit--1.5%
25,000,000 SunTrust Banks, Inc., 5.563%, 12/1/1999 25,000,000
--------------
(1) Certificates of Deposit--14.3%
25,000,000 Barclays Bank PLC, London, 5.950%, 1/18/2000 25,000,330
30,000,000 Bayerische Landesbank Girozentrale, 5.410%,
12/21/1999 30,000,164
20,000,000 Bayerische Landesbank--NY, 5.980%, 1/18/2000 20,000,264
25,000,000 Deutsche Bank AG, 5.900%, 1/18/2000 25,000,000
35,000,000 National Westminster Bank, PLC, London, 4.980%,
1/10/2000 34,998,150
30,000,000 Regions Bank, Alabama, 5.370%, 1/27/2000 30,000,000
15,000,000 Toronto Dominion Holdings (USA), Inc., 4.990%,
1/6/2000 14,999,572
50,000,000 Westdeutsche Landesbank Girozentrale, 5.125%,
12/7/1999 50,000,080
15,000,000 Westdeutsche Landesbank Girozentrale, 5.900%,
1/18/2000 15,000,000
--------------
Total Certificates of Deposit 244,998,560
--------------
(1) Commercial Paper--27.8%
Bank--1.4%
25,000,000 Credit Suisse First Boston, 5.780%, 2/18/2000 24,682,903
--------------
Basic Materials--2.9%
50,000,000 Rio Tinto America, Inc., 5.750%-5.930%,
12/1/1999-1/20/2000 49,794,097
--------------
Capital Goods--1.4%
25,000,000 General Electric Capital Corp., 5.910%, 3/9/2000 24,593,688
--------------
Consumer Cyclicals--1.5%
25,000,000 Gannett Co., Inc., 5.960%, 1/26/2000 24,768,222
--------------
Finance--17.4%
30,000,000 American General Finance Corp., 5.381%, 12/8/1999 29,969,025
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Prime Cash Management Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
(1) Commercial Paper--continued
Finance--continued
$50,000,000 Associates First Capital Corp., 5.170%-5.869%,
12/15/1999-2/15/2000 $ 49,798,822
25,000,000 CIT Group, Inc., 5.730%, 12/1/1999 25,000,000
40,000,000 General Motors Acceptance Corp., 5.851%-5.891%,
2/9/2000-2/16/2000 39,532,789
45,000,000 Household Finance Corp., 5.890%-5.960%, 2/3/2000-
2/18/2000 44,476,605
25,000,000 J.P. Morgan & Co., Inc., 5.580%, 1/25/2000 24,786,876
25,000,000 Prudential Funding Corp., 5.710%, 1/12/2000 24,833,458
60,000,000 Wells Fargo & Co., 5.850%-5.940%, 2/3/2000-
3/16/2000 59,068,558
--------------
Total 297,466,133
--------------
Finance-Commercial--3.2%
55,000,000 General Electric Capital Corp., 5.863%-5.930%,
2/2/2000-3/8/2000 54,320,052
--------------
Total Commercial Paper 475,625,095
--------------
(2) Notes - Variable--22.2%
Bank--1.5%
25,000,000 PNC Bank, NA, 5.310%, 3/1/2000 24,998,769
--------------
Finance-Banks--17.2%
30,000,000 Bank One, NA, 6.008%, 2/8/2000 29,998,606
30,000,000 Bank One, NA, 5.760%, 12/1/1999 29,999,638
30,000,000 First Union National Bank, Charlotte, NC, 5.469%,
12/17/1999 30,000,000
75,000,000 Mellon Bank NA, Pittsburgh, 5.970%, 2/18/2000 74,997,619
15,000,000 SouthTrust Bank of Alabama, Birmingham, 5.300%,
12/13/1999 14,997,321
75,000,000 SouthTrust Bank of Alabama, Birmingham, 5.325%,
12/7/1999 74,997,250
40,000,000 Texaco Capital, Inc., 6.011%, 2/3/2000 39,985,189
--------------
Total 294,975,623
--------------
Student Loan Marketing Association--3.5%
60,000,000 6.005%, 2/11/2000 59,995,614
--------------
Total Notes - Variable 379,970,006
--------------
(1) U.S. Government Agencies--2.1%
Federal Home Loan Mortgage Corp.--0.9%
15,000,000 5.020%, 12/10/1999 14,981,175
--------------
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Prime Cash Management Fund
<TABLE>
<CAPTION>
Principal
Amount
or Shares Value
- ------------------------------------------------------------------------------
<C> <S> <C>
(1) U.S. Government Agencies--continued
Federal National Mortgage Association--1.2%
$20,000,000 5.000%, 12/3/1999 $ 19,994,444
--------------
Total U.S. Government Agencies 34,975,619
--------------
Mutual Funds--8.5%
52,500,000 Aim Liquid Assets Portfolio 52,500,000
40,000,000 Dreyfus Cash Management 40,000,000
52,500,000 Federated Prime Obligations Fund 52,500,000
--------------
Total Mutual Funds 145,000,000
--------------
(3) Repurchase Agreements--17.4%
$50,000,000 Credit Suisse First Boston, Inc., 5.600%, dated
11/30/1999, due 12/1/1999 50,000,000
82,168,550 Goldman Sachs Group, LP, 5.670%, dated
11/30/1999, due 12/1/1999 82,168,550
82,353,000 Merrill Lynch, Pierce, Fenner and Smith, 5.640%,
dated 11/30/1999, due 12/1/1999 82,353,000
83,353,000 Morgan Stanley Group, Inc., 5.700%, dated
11/30/1999, due 12/1/1999 83,353,000
--------------
Total Repurchase Agreements 297,874,550
--------------
Total Investments, at amortized cost and
value (4) $1,708,441,324
--------------
</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. government 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
($1,710,005,316) at November 30, 1999.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Prime Cash Management Fund
Statement of Assets and Liabilities
November 30, 1999
<TABLE>
<S> <C> <C>
Assets:
Investments in repurchase agreements $ 297,874,550
Investments in securities 1,410,566,774
--------------
Total investments in securities,
at amortized cost and value $1,708,441,324
Income receivable 9,433,527
--------------
Total assets 1,717,874,851
Liabilities:
Income distribution payable 7,576,873
Accrued expenses 292,662
--------------
Total liabilities 7,869,535
--------------
Net Assets for 1,710,005,316 shares
outstanding $1,710,005,316
--------------
Net Asset Value, Offering Price and
Redemption Proceeds Per Share:
$1,710,005,316 (divided by)
1,710,005,316 shares outstanding $1.00
--------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Prime Cash Management Fund
Statement of Operations
Year Ended November 30, 1999
<TABLE>
<S> <C> <C>
Investment Income:
Interest $94,851,628
Expenses:
Investment adviser fee $ 5,565,471
Administrative personnel and services fee 927,578
Custodian fees 223,016
Transfer and dividend disbursing agent fees and expenses 4,070
Directors'/Trustees' fees 46,202
Auditing fees 14,921
Legal fees 16,427
Portfolio accounting fees 3,188
Share registration costs 36,775
Printing and postage 14,629
Insurance premiums 2,503
Miscellaneous 38,344
-----------
Total expenses 6,893,124
Waiver--
Waiver of investment adviser fee (3,551,920)
-----------
Net expenses 3,341,204
-----------
Net investment income $91,510,424
-----------
</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>
Year Ended November 30,
--------------------------------
1999 1998
- -----------------------------------------------------------------------------
<S> <C> <C>
Increase (Decrease) in Net Assets:
Operations--
Net investment income $ 91,510,424 $ 92,391,044
--------------- ---------------
Distributions to Shareholders--
Distributions from net investment income (91,510,424) (92,391,044)
--------------- ---------------
Share Transactions--
Proceeds from sale of shares 3,368,940,656 4,606,987,634
Cost of shares redeemed (3,488,146,575) (4,227,971,062)
--------------- ---------------
Change in net assets resulting from share
transactions (119,205,919) 379,016,572
--------------- ---------------
Change in net assets (119,205,919) 379,016,572
Net Assets:
Beginning of period 1,829,211,235 1,450,194,663
--------------- ---------------
End of period $ 1,710,005,316 $ 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>
Year Ended November 30,
-------------------------------------------------------
1999 1998 1997 1996 1995
- ----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Income from investment
operations
Net investment income 0.05 0.05 0.05 0.05 0.06
Less distributions
Distributions from net
investment income (0.05) (0.05) (0.05) (0.05) (0.06)
---------- ---------- ---------- ---------- --------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- --------
Total return (1) 5.05% 5.54% 5.55% 5.44% 5.95%
Ratios to average net
assets
Expenses 0.18% 0.18% 0.18% 0.18% 0.18%
Net investment income 4.93% 5.40% 5.43% 5.34% 5.80%
Expense waiver/
reimbursement (2) 0.19% 0.19% 0.25% 0.27% 0.27%
Supplemental data
Net assets, end of
period (000 omitted) $1,710,005 $1,829,211 $1,450,195 $1,176,855 $879,603
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.
(2) This contractual expense decrease is reflected in both the expense and net
income ratios shown above.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--99.5%
Alabama--10.1%
$ 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
9,700,000 The Board of Trustees of the University of Alabama,
University & College Improvements (Series B) Weekly
VRDNs 9,700,000
375,000 Tuscaloosa County, AL, Port Authority, (Series
1989A) Weekly VRDNs (Capstone Hotel
Ltd.)/(SouthTrust Bank of Alabama, Birmingham LOC) 375,000
------------
Total 37,295,000
------------
California--1.4%
5,000,000 Los Angeles County, CA, (Series A), 4.00% TRANs,
6/30/2000 5,019,051
------------
Colorado--1.3%
5,000,000 Arapahoe County, CO, School District 005, GO UT, 4.25% Bonds,
6/30/2000 5,014,956
------------
Delaware--1.2%
4,455,000 Delaware State, GO UT, Public Improvement Refunding
Bonds (Series A), 4.50% Bonds, 2/1/2000 4,466,683
------------
Florida--7.9%
100,000 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) 100,038
5,000,000 Broward County, FL, HFA, Revenue Bonds Weekly VRDNs
(Welleby Apartments) 5,000,000
6,600,000 Collier County, FL, HFA, Multi-family Revenue Bonds
(Series 1985) Weekly VRDNs (River Reach Project) 6,600,000
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
Florida--continued
$ 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)/(Banque 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.)/(Rabobank
Nederland, Utrecht LOC) 1,000,000
4,500,000 Southeast Volusia Hospital District, FL, Revenue
Bonds (Series 1995) Weekly VRDNs (Bert Fish Medical
Center (FL))/(SouthTrust Bank of Alabama,
Birmingham LOC) 4,500,000
7,000,000 St. Lucie County, FL, PCR, 3.55% CP, Mandatory
Tender 12/8/1999 7,000,000
------------
Total 29,230,038
------------
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
4,450,000 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) 4,449,999
2,900,000 Lowndes County, GA, Residential Care Facilities for
the Elderly Authority Weekly VRDNs (South Georgia
Health Alliance Project) 2,900,000
770,000 Macon-Bibb County, GA, Urban Development Authority,
Refunding Revenue Bonds (Series 1995) Weekly VRDNs
(Macon Hotel Investors)/(Bank One, Michigan LOC) 770,000
500,000 Monroe County, GA, Development Authority IDRB,
Refunding Revenue Bonds Weekly VRDNs (Forsyth Inns,
Inc.)/(Bank One, Michigan LOC) 500,000
5,120,000 Richmond County, GA, Board of Education, GO UT
Refunding Bonds, 4.50% Bonds, 3/1/2000 5,139,811
------------
Total 22,359,810
------------
Idaho--1.4%
5,000,000 Idaho State, 4.25% Bonds, 6/30/2000 5,023,785
------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
Illinois--8.0%
$11,800,000 Illinois Development Finance Authority Weekly VRDNs $ 11,800,000
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
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 29,620,000
------------
Iowa--1.3%
5,000,000 Iowa School Corporations, (Series B), 3.50% Bonds
(FSA LOC), 1/28/2000 5,004,084
------------
Kentucky--5.6%
500,000 Georgetown, KY, Educational Institution, Revenue
Bonds Weekly VRDNs (Georgetown College) 500,000
20,000,000 Kentucky Interlocal School Transportation
Association, 4.00% Bonds, 6/30/2000 20,055,875
------------
Total 20,555,875
------------
Louisiana--1.2%
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
------------
Massachusetts--4.5%
10,000,000 Commonwealth of Massachusetts, (Series B) Weekly
VRDNs (Toronto-Dominion Bank LOC) 10,000,000
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
Massachusetts--continued
$ 100,000 Massachusetts HEFA, (Series P1) 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 16,600,000
------------
Mississippi--0.6%
2,340,000 Jackson County, MS, 2.90% TOBs (Chevron Corp. GTD)
11/1/2004 2,340,000
------------
Missouri--0.5%
1,800,000 Kansas City, MO, IDA, IDRB, Weekly VRDNs (Mid-
American Health Services) 1,800,000
------------
New Mexico--2.2%
8,000,000 New Mexico State, Revenue Notes, 4.00% Bonds,
6/30/2000 8,034,524
------------
New York--6.5%
10,000,000 Long Island Power Authority, NY, Revenue Bonds
Weekly VRDNs (Credit Suisse First Boston and MBIA
LOCs) 10,000,000
6,510,000 Monroe County, NY, GO UT Refunding Bonds, 5.00%
Bonds, 3/1/2000 6,543,110
100,000 New York City, NY, (Subseries B4) Daily VRDNs (MBIA INS)/(National
Westminster Bank, PLC, London LIQ) 100,000
2,850,000 New York City, NY, GO UT Bonds Daily VRDNs 2,850,000
4,300,000 New York City, NY, GO UT Refunding Bonds (Subseries
E3) Daily VRDNs 4,300,000
100,000 New York City, NY, (Subseries E2) Daily VRDNs
(Morgan Guaranty Trust Co., New York LOC) 100,000
------------
Total 23,893,110
------------
North Carolina--0.9%
1,500,000 Alamance County, NC, Industrial Facilities &
Pollution Control Financing Authority, Revenue
Bonds Weekly VRDNs (SCI Systems, Inc.) 1,500,000
1,900,000 North Carolina Educational Facilities Finance
Agency Weekly VRDNs (Gardner Webb
University)/(First Union National Bank, Charlotte,
NC LOC) 1,900,000
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
North Carolina--continued
$ 115,000 North Carolina Medical Care Commission , Revenue
Bonds (Series A) Weekly VRDNs (Pooled Financing
Program) $ 115,000
------------
Total 3,515,000
------------
Ohio--5.1%
930,000 Centerville, OH, Health Care Revenue Bonds Weekly
VRDNs (Bethany Lutheran Village) 930,000
18,000,000 Lorain County, OH, (Series A), 3.55% CP, Mandatory
Tender 12/8/1999 18,000,000
------------
Total 18,930,000
------------
Oklahoma--1.2%
4,300,000 Tulsa County, OK, Independent School District 1,
School Improvements, 5.00% Bonds, 2/1/2000 4,314,532
------------
Oregon--5.0%
13,500,000 Oregon State, Veteran's Welfare Bonds (Series 73E)
Weekly VRDNs (Morgan Guaranty Trust Co., New York
LOC) 13,500,000
5,000,000 Oregon State, Veteran's Welfare Bonds (Series 73F)
Weekly VRDNs (Morgan Guaranty Trust Co., New York
LOC) 5,000,000
------------
Total 18,500,000
------------
Pennsylvania--1.3%
4,700,000 Allegheny County, PA, IDA, Revenue Bonds (Series A)
Weekly VRDNs (United Jewish Federation of Greater
Pittsburgh VRDB)/(PNC Bank, NA LOC) 4,700,000
------------
Tennessee--5.2%
4,150,000 Clarksville, TN, Public Building Authority,
Adjustable Rate Pooled Financing Revenue Bonds
(Series 1997) Weekly VRDNs (Tennessee Municipal
Bond Fund)/(Bank of America, NA, Charlotte LOC) 4,150,000
1,200,000 Clarksville, TN, Public Building Authority, Public
Improvement Revenue Bonds Weekly VRDNs 1,200,000
7,395,000 Knox County, TN, GO UT Refunding Bonds, 4.50%
Bonds, 3/1/2000 7,423,614
4,600,000 Metropolitan Nashville, TN AA, (Series 1993) Weekly
VRDNs (FGIC INS)/(Societe Generale, Paris
LIQ)/(Societe Generale, Paris LOC) 4,600,000
2,000,000 Montgomery Co, TN, Public Building Authority Weekly
VRDNs 2,000,000
------------
Total 19,373,614
------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Principal
Amount Value
- -------------------------------------------------------------------------------
<C> <S> <C>
Short-Term Municipals--continued
Texas--6.8%
$10,600,000 Lower Neches Valley, TX, Refunding Revenue Bonds,
3.45% TOBs (Chevron U.S.A., Inc.), Optional Tender
2/16/2000 $ 10,600,000
3,800,000 Richardson, TX, Independent School District,
(Series A) Weekly VRDNs (PSFG GTD)/(Union Bank of
Switzerland, Zurich SA) 3,800,000
10,500,000 Texas State, GO UT, 7.125% Bonds, 4/1/2000
(Callable @102) 10,720,853
------------
Total 25,120,853
------------
Virginia--1.8%
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% Bonds,
2/1/2000 6,211,382
------------
Total 6,511,382
------------
Washington--3.8%
14,000,000 Port Anacortes, WA Industrial Development Corp.
VRDNs (Texaco, Inc.) 14,000,000
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 14,099,998
------------
West Virginia--1.6%
5,900,000 West Virginia State Hospital Finance Authority,
(Series A) Weekly VRDNs (Oak Hill, WV)/(Bank One,
NA COL) 5,900,000
------------
Wisconsin--7.1%
19,000,000 Wisconsin Health and Educational Facilities
Authority, (Series A) Revenue Bonds Weekly VRDNs
(Felician Health Care, Inc.)/(AMBAC INS) 19,000,000
7,320,000 Wisconsin State Health Facilities Authority,
Revenue Bonds (Series A2) Weekly VRDNs (Franciscan
Health Care) 7,320,000
------------
Total 26,320,000
------------
Total Short-Term Municipals 368,042,295
------------
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
<TABLE>
<CAPTION>
Shares Value
- ------------------------------------------------------------------------------
<C> <S> <C>
Mutual Funds--0.2%
612,207 AIM Global Management Short Term Investments Money
Market Fund $ 612,207
881 Dreyfus Tax Exempt Money Market Fund 880
346 Federated Investors Tax-Free Obligations Fund 346
59,368 Fidelity Tax Exempt Money Market Fund 59,368
------------
Total 672,801
------------
Total Investments, at amortized cost and value (1) $368,715,096
------------
</TABLE>
(1) Also represents cost for federal tax purposes.
Note: The categories of investments are shown as a percentage of net assets
($369,902,924) at November 30, 1999.
The following acronyms are used throughout this portfolio:
AMBAC--American Municipal Bond Assurance INS--Insured
Corporation LIQ--Liquidity Agreement
COL--Collateralized LOC--Letter 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
HEFA--Health and Education Facilities TOBs--Tender Option Bonds
Authority TRANs--Tax and Revenue Anticipation
HFA--Housing Finance Authority Notes
IDA--Industrial Development Authority UT--Unlimited Tax
IDB--Industrial Development Bond VRDB--Variable Rate Demand Bond
IDRB--Industrial Development Revenue Bond VRDNs--Variable Rate Demand Notes
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia Tax-Free Money Market Fund
Statement of Assets and Liabilities
November 30, 1999
<TABLE>
<S> <C> <C>
Assets:
Total investments in securities, at amortized cost and value $368,715,096
Income receivable 2,376,025
------------
Total assets 371,091,121
Liabilities:
Income distribution payable $1,044,135
Accrued expenses 144,062
----------
Total liabilities 1,188,197
------------
Net Assets for 369,902,924 shares outstanding $369,902,924
------------
Net Asset Value, Offering Price and Redemption Proceeds
Per Share:
Institutional Shares: $225,466,430 (divided by) 225,466,430
shares outstanding $1.00
------------
Investment Shares: $144,436,494 (divided by) 144,436,494
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
Year Ended November 30, 1999
<TABLE>
<S> <C> <C>
Investment Income:
Interest $13,418,639
Expenses:
Investment adviser fee $ 2,104,651
Administrative personnel and services fee 353,303
Custodian fees 75,640
Transfer and dividend disbursing agent fees and
expenses 12,568
Directors'/Trustees' fees 9,246
Auditing fees 15,208
Legal fees 6,529
Portfolio accounting fees 892
Distribution services fee--Investment Shares 606,130
Share registration costs 12,703
Printing and postage 21,104
Insurance premiums 2,998
Miscellaneous 15,742
-----------
Total expenses 3,236,714
Waiver of investment adviser fee (1,626,095)
-----------
Net expenses 1,610,619
-----------
Net investment income $11,808,020
-----------
</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>
Year Ended November 30,
-----------------------------
1999 1998
- -------------------------------------------------------------------------
<S> <C> <C>
Increase (Decrease) in Net Assets:
Operations--
Net investment income $ 11,808,020 $ 11,680,208
------------- -------------
Distributions to Shareholders--
Distributions from net investment income
Institutional Shares (7,932,704) (8,367,231)
Investment Shares (3,875,316) (3,312,977)
------------- -------------
Change in net assets resulting from
distributions to shareholders (11,808,020) (11,680,208)
------------- -------------
Share Transactions--
Proceeds from sale of shares 671,733,491 743,274,021
Cost of shares redeemed (710,364,176) (603,065,021)
------------- -------------
Change in net assets resulting from share
transactions (38,630,685) 140,209,000
------------- -------------
Change in net assets (38,630,685) 140,209,000
Net Assets:
Beginning of period 408,533,609 268,324,609
------------- -------------
End of period $ 369,902,924 $ 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>
Year Ended November 30,
-----------------------------------------------
1999 1998 1997 1996 1995
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Income from investment
operations
Net investment income 0.03 0.03 0.03 0.03 0.04
-------- -------- -------- -------- -------
Less distributions
Distributions from net
investment income (0.03) (0.03) (0.03) (0.03) (0.04)
-------- -------- -------- -------- -------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- -------
Total return (1) 2.99% 3.29% 3.41% 3.24% 3.59%
Ratios to average net assets
Expenses 0.24% 0.24% 0.24% 0.29% 0.32%
Net investment income 2.95% 3.24% 3.34% 3.22% 3.55%
Expense waiver/reimbursement
(2) 0.39% 0.42% 0.45% 0.43% 0.46%
Supplemental data
Net assets, end of period
(000 omitted) $225,466 $275,323 $182,473 $118,877 $80,274
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.
(2) This contractual expense decrease is reflected in both the expense and net
investment income ratios shown above.
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia U.S. Treasury Money Market Fund
Portfolio of Investments
November 30, 1999
<TABLE>
<CAPTION>
Principal
Amount
or Shares Value
- -------------------------------------------------------------------------------
<C> <S> <C>
U.S. Government Obligations--43.8%
U.S. Treasury Bills--4.1%
$ 27,500,000 12/9/1999--1/20/2000 $ 27,363,596
------------
U.S. Treasury Notes--39.7%
260,000,000 5.375%-6.875%, 12/31/1999-6/30/2000 260,534,828
------------
Total U.S. Government Obligations 287,898,424
------------
(1) Repurchase Agreements--54.1%
30,000,000 First Boston, 5.600%, dated 11/30/1999, due
12/1/1999 30,000,000
146,809,289 Goldman Sachs Group, LP, 5.600%, dated 11/30/1999,
due 12/1/1999 146,809,288
30,000,000 Merrill Lynch, Pierce, Fenner and Smith, 5.640%,
dated 11/30/1999, due 12/1/1999 30,000,000
148,809,289 Morgan Stanley Group, Inc., 5.650%, dated
11/30/1999, due 12/1/1999 148,809,289
------------
Total Repurchase Agreements 355,618,577
------------
Mutual Fund--2.0%
13,000,000 Federated Treasury Obligations Fund 13,000,000
------------
Total Investments, at amortized cost and value (2) $656,517,001
------------
</TABLE>
(1) The repurchase agreements are fully collateralized by U.S. Treasury
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
($656,779,427) at November 30, 1999.
(See Notes which are an integral part of the Financial Statements)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Wachovia U.S. Treasury Money Market Fund
Statement of Assets and Liabilities
November 30, 1999
<TABLE>
<S> <C> <C>
Assets:
Investments in repurchase agreements $ 355,618,577
Investments in securities 300,898,424
-------------
Total investments in securities, at amortized cost and value $656,517,001
Income receivable 3,213,574
------------
Total assets 659,730,575
Liabilities:
Income distribution payable 2,732,724
Accrued expenses 218,424
-------------
Total liabilities 2,951,148
------------
Net Assets for 656,779,427 shares outstanding $656,779,427
------------
Net Asset Value, Offering Price and Redemption
Proceeds Per Share:
Institutional Shares: ($448,758,441 (divided by) 448,758,441
shares outstanding) $1.00
------------
Investment Shares: ($208,020,986 (divided by) 208,020,986
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
Year Ended November 30, 1999
<TABLE>
<S> <C> <C>
Investment Income:
Interest $33,485,781
Expenses:
Investment adviser fee $ 3,415,568
Administrative personnel and services fee 573,461
Custodian fees 105,818
Transfer and dividend disbursing agent fees and
expenses 7,654
Directors'/Trustees' fees 16,064
Auditing fees 14,981
Legal fees 6,107
Portfolio accounting fees 3,142
Distribution services fee--Investment Shares 789,762
Share registration costs 25,669
Printing and postage 29,977
Insurance premiums 3,703
Miscellaneous 9,920
-----------
Total expenses 5,001,826
Waiver of investment adviser fee (2,576,070)
-----------
Net expenses 2,425,756
-----------
Net investment income $31,060,025
-----------
</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>
Year Ended November 30,
---------------------------------
1999 1998
- -----------------------------------------------------------------------------
<S> <C> <C>
Increase (Decrease) in Net Assets:
Operations--
Net investment income $ 31,060,025 $ 34,194,612
--------------- ---------------
Distributions to Shareholders--
Distributions from net investment income
Institutional Shares (22,602,956) (27,082,585)
Investment Shares (8,457,069) (7,112,027)
--------------- ---------------
Change in net assets resulting from
distributions to shareholders (31,060,025) (34,194,612)
--------------- ---------------
Share Transactions--
Proceeds from sale of shares 1,484,059,570 1,496,501,247
Net asset value of shares issued to
shareholders in payment of distributions
declared 39,796 27,832
Cost of shares redeemed (1,492,629,325) (1,459,037,222)
--------------- ---------------
Change in net assets resulting from share
transactions (8,529,959) 37,491,857
--------------- ---------------
Change in net assets (8,529,959) 37,491,857
Net Assets:
Beginning of period 665,309,386 627,817,529
--------------- ---------------
End of period $ 656,779,427 $ 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>
Year Ended November 30,
------------------------------------------------
1999 1998 1997 1996 1995
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Income from investment
operations
Net investment income 0.05 0.05 0.05 0.05 0.06
Less distributions
Distributions from net
investment income (0.05) (0.05) (0.05) (0.05) (0.06)
-------- -------- -------- -------- --------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- --------
Total return (1) 4.77% 5.25% 5.31% 5.18% 5.66%
Ratios to average net assets
Expenses 0.24% 0.24% 0.24% 0.30% 0.32%
Net investment income 4.65% 5.15% 5.20% 5.07% 5.54%
Expense waiver/reimbursement
(2) 0.38% 0.40% 0.41% 0.39% 0.40%
Supplemental data
Net assets, end of period
(000 omitted) $448,758 $466,538 $510,323 $302,306 $214,356
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.
(2) This contractual expense decrease is reflected in both the expense and net
investment income ratios shown above.
(See Notes which are an integral part of the Financial Statements)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Funds
Combined Notes to Financial Statements
November 30, 1999
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 fifteen 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 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, 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 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
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Funds
Code, as amended (the "Code"). Distributions to shareholders are recorded on
the ex-dividend date. The Trust offers multiple classes of shares, which
differ in their respective distribution and service fees. All shareholders
bear the common expenses of the Funds based on average daily net assets of
each class, without distinction between share classes. Dividends are declared
separately for each class. No class has preferential dividend rights;
differences in per share dividend rates are generally due to differences in
separate class expenses.
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
provision for federal tax is 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.
Losses may occur on these transactions due to changes in market conditions or
the failure of counterparties to perform under the contract.
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 a trade date basis.
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.
Transactions in shares were as follows:
<TABLE>
<CAPTION>
Prime Cash Fund Tax-Free Fund U.S. Treasury Fund
------------------------------ --------------------------
- ------------------------------
Year Ended November 30, Year Ended November 30, Year Ended November 30,
1999 1998 1999 1998 1999 1998
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Institutional Shares
- -----------------------
Shares sold 3,368,940,656 4,606,987,634 307,834,572 367,947,784 1,142,479,883
1,162,773,272
Shares redeemed (3,488,146,575) (4,227,971,062) (357,690,587) (275,098,274) (1,160,259,358)
(1,206,558,183)
- ----------------------- -------------- -------------- ------------ ------------ --------------
- --------------
Net change resulting
from Institutional
Shares transactions (119,205,919) 379,016,572 (49,856,015) 92,849,510 (17,779,475)
(43,784,911)
-------------- -------------- ------------ ------------ --------------
- --------------
Investment Shares
- -----------------------
Shares sold -- -- 363,898,919 375,326,237 341,579,687
333,727,978
Shares issued to
shareholders in payment
of distributions
declared -- -- -- -- 39,796
27,829
Shares redeemed -- -- (352,673,589) (327,966,747) (332,369,967)
(252,479,039)
- ----------------------- -------------- -------------- ------------ ------------ --------------
- --------------
Net change resulting
from Investment Shares
transactions -- -- 11,225,330 47,359,490 9,249,516
81,276,768
-------------- -------------- ------------ ------------ --------------
- --------------
Net change resulting
from share transactions (119,205,919) 379,016,572 (38,630,685) 140,209,000 (8,529,959)
37,491,857
- ----------------------- -------------- -------------- ------------ ------------ --------------
- --------------
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Wachovia Money Market Funds
4. Investment Advisory Fee and Other Transactions with Affiliates
Investment Advisory Fee--Wachovia Asset Management, a subsidiary of Wachovia
Bank N.A. and the Funds' investment adviser (the "Adviser"), receives for its
services an annual investment adviser fee based on each Fund's average daily net
assets.
<TABLE>
<CAPTION>
Fund Annual rate
---- -----------
<S> <C>
Prime Cash Fund 0.30%
Tax-Free Fund 0.50%
U.S. Treasury Fund 0.50%
</TABLE>
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, 2001.
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.
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 of the Trust are Officers and Directors or
Trustees of the above companies.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Report of Ernst & Young LLP, Independent Auditors
To the Trustees and Shareholders of THE WACHOVIA FUNDS:
We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of Wachovia Prime Cash Management Fund, Wachovia
Tax-Free Money Market Fund, and Wachovia U.S. Treasury Money Market Fund (three
of the portfolios constituting The Wachovia Funds) as of November 30, 1999, and
the related statements of operations for the year then ended, the statements of
changes in net assets for each of the two years in the period then ended, and
the financial highlights for each of the five years in the period then ended.
These financial statements and financial highlights are the responsibility of
the Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of securities
owned as of November 30, 1999, by correspondence with the custodian. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Wachovia Prime Cash Management Fund, Wachovia Tax-Free Money Market Fund, and
Wachovia U.S. Treasury Money Market Fund of The Wachovia Funds at November 30,
1999, and the results of their operations for the year then ended, changes in
their net assets for each of the two years in the period then ended, and the
financial highlights for each of the five years in the period then ended, in
conformity with accounting principles generally accepted in the United States.
/s/ Ernst & Young LLP
Boston, Massachusetts
January 17, 2000
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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
Charles S. Way, Jr. Treasurer
Alvin J. Schexnider Gail Cagney
Secretary
Peter J. Germain
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. Although money market funds seek to maintain a
stable net asset value of $1.00 per share, there is no assurance that they will
be able to do so.
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.
Cusip 929901684
Cusip 929901684
Cusip 929901684
Cusip 929901684
Federated Securities Corp., Distributor Cusip 929901684
831-30 (1/00) G01512-18 (1/00)
WACHOVIA APPENDIX DOCUMENT
A1 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class A
Shares of Wachovia Equity Fund based on a 4.50% sales load are represented by a
solid line. The Standard & Poor's 500 Index (the "S&P 500") is represented by a
dotted line. The line graph is a visual representation of a comparison of change
in value of a $10,000 hypothetical investment in the Class A Shares of the fund,
and the S&P 500. The "x" axis reflects computation periods from 5/7/93 to
11/30/99. The "y" axis reflects the cost of the investment. The right margin
reflects the ending value of the hypothetical investment in the fund's Class A
Shares, based on a 4.50% sales load, as compared to the S&P 500. The ending
values were $28,936, and $36,086, respectively. The legend in the bottom
quadrant of the graphic presentation indicates the fund's Class A Shares Average
Annual Total Returns for the one-year and five-year periods ended 11/30/99 and
from the fund's start of performance (5/7/93) (cumulative) and start of
performance (5/7/93) to 11/30/99. The total returns were 18.71%, 22.03%, 189.36%
and 17.55%, respectively.
A2 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class B
Shares of Wachovia Equity Fund are represented by a solid line. The Standard &
Poor's 500 Index (the "S&P 500") is represented by a dotted line. The line graph
is a visual representation of a comparison of change in value of a $10,000
hypothetical investment in the Class A Shares of the fund, and the S&P 500. The
"x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis
reflects the cost of the investment. The right margin reflects the ending value
of the hypothetical investment in the fund's Class B Shares, as compared to the
S&P 500. The ending values were $20,147, and $23,397, respectively. The legend
in the bottom quadrant of the graphic presentation indicates the fund's Class B
Shares Average Annual Total Returns for the one-year period ended 11/30/99 and
from the fund's start of performance (7/23/96) (cumulative) and start of
performance (7/23/96) to 11/30/99. The total returns were 18.37%, 101.47% and
23.19%, respectively.
A3. The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class Y
Shares of Wachovia Equity Fund are represented by a solid line. The Standard &
Poor's 500 Index (the "S&P 500") is represented by a dotted line. The line graph
is a visual representation of a comparison of change in value of a $10,000
hypothetical investment in the Class Y Shares of the fund, and the S&P 500. The
"x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis
reflects the cost of the investment. The right margin reflects the ending value
of the hypothetical investment in the fund's Class A Shares, as compared to the
S&P 500. The ending values were $21,105, and $23,397, respectively. The legend
in the bottom quadrant of the graphic presentation indicates the fund's Class Y
Shares Average Annual Total Returns for the one-year period ended 11/30/99 and
from the fund's start of performance (7/23/96) (cumulative) and start of
performance (7/23/96) to 11/30/99. The total returns were 24.52%, 111.05% and
24.90%, respectively.
A4 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class A
Shares of Wachovia Quantitative Equity Fund based on a 4.50% sales load are
represented by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is
represented by a dotted line. The line graph is a visual representation of a
comparison of change in value of a $10,000 hypothetical investment in the Class
A Shares of the fund, and the S&P 500. The "x" axis reflects computation periods
from 3/25/94 to 11/30/99. The "y" axis reflects the cost of the investment. The
right margin reflects the ending value of the hypothetical investment in the
fund's Class A Shares, based on a 4.50% sales load, as compared to the S&P 500.
The ending values were $28,648, and $33,809, respectively. The legend in the
bottom quadrant of the graphic presentation indicates the fund's Class A Shares
Average Annual Total Returns for the one-year and five-year periods ended
11/30/99 and from the fund's start of performance (3/25/94) (cumulative) and
start of performance (3/25/94) to 11/30/99. The total returns were 11.33%,
24.21%, 186.48% and 20.33%, respectively.
A5 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class B
Shares of Wachovia Quantitative Equity Fund are represented by a solid line. The
Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line. The
line graph is a visual representation of a comparison of change in value of a
$10,000 hypothetical investment in the Class B Shares of the fund, and the S&P
500. The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y"
axis reflects the cost of the investment. The right margin reflects the ending
value of the hypothetical investment in the fund's Class A Shares, as compared
to the S&P 500. The ending values were $20,760, and $23,397, respectively. The
legend in the bottom quadrant of the graphic presentation indicates the fund's
Class B Shares Average Annual Total Returns for the one-year period ended
11/30/99 and from the fund's start of performance (7/23/96) (cumulative) and
start of performance (7/23/96) to 11/30/99. The total returns were 10.85%,
107.60% and 24.29%, respectively.
A6 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class Y
Shares of Wachovia Quantitative Equity Fund are represented by a solid line. The
Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line. The
line graph is a visual representation of a comparison of change in value of a
$10,000 hypothetical investment in the Class Y Shares of the fund, and the S&P
500. The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y"
axis reflects the cost of the investment. The right margin reflects the ending
value of the hypothetical investment in the fund's Class Y Shares, as compared
to the S&P 500. The ending values were $21,753, and $23,397, respectively. The
legend in the bottom quadrant of the graphic presentation indicates the fund's
Class Y Shares Average Annual Total Returns for the one-year period ended
11/30/99 and from the fund's start of performance (7/23/96) (cumulative) and
start of performance (7/23/96) to 11/30/99. The total returns were 16.97%,
117.53% and 26.03%, respectively.
A7 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class A
Shares of Wachovia Growth and Income Fund based on a 4.50% sales load are
represented by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is
represented by a dotted line. The line graph is a visual representation of a
comparison of change in value of a $10,000 hypothetical investment in the Class
A Shares of the fund, and the S&P 500. The "x" axis reflects computation periods
from 1/29/93 to 11/30/99. The "y" axis reflects the cost of the investment. The
right margin reflects the ending value of the hypothetical investment in the
fund's Class A Shares, based on a 4.50% sales load, as compared to the S&P 500.
The ending values were $31,357, and $36,674, respectively. The legend in the
bottom quadrant of the graphic presentation indicates the fund's Class A Shares
Average Annual Total Returns for the one-year and five-year periods ended
11/30/99 and from the fund's start of performance (1/29/93) (cumulative) and
start of performance (1/29/93) to 11/30/99. The total returns were 14.98%,
25.41%, 213.57% and 18.95%, respectively.
A8 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class Y
Shares of Wachovia Growth and Income Fund are represented by a solid line. The
Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line. The
line graph is a visual representation of a comparison of change in value of a
$10,000 hypothetical investment in the Class Y Shares of the fund, and the S&P
500. The "x" axis reflects computation periods from 3/29/98 to 11/30/99. The "y"
axis reflects the cost of the investment. The right margin reflects the ending
value of the hypothetical investment in the fund's Class Y Shares, as compared
to the S&P 500. The ending values were $12,801, and $12,974, respectively. The
legend in the bottom quadrant of the graphic presentation indicates the fund's
Class Y Shares Average Annual Total Returns for the one-year period ended
3/29/98 and from the fund's start of performance (3/29/98) (cumulative) and
start of performance (3/29/98) to 11/30/99. The total returns were 20.73%,
28.01% and 15.90%, respectively.
A9 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class A
Shares of Wachovia Equity Index Fund based on a 4.50% sales load are represented
by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is represented
by a dotted line.
The line graph is a visual representation of a comparison of change in value of
a $10,000 hypothetical investment in the Class A Shares of the fund, and the S&P
500. The "x" axis reflects computation periods from 5/7/93 to 11/30/99. The "y"
axis reflects the cost of the investment. The right margin reflects the ending
value of the hypothetical investment in the fund's Class A Shares, based on a
4.50% sales load, as compared to the S&P 500. The ending values were $33,050,
and $36,086, respectively. The legend in the bottom quadrant of the graphic
presentation indicates the fund's Class A Shares Average Annual Total Returns
for the one-year and five-year periods ended 11/30/99 and from the fund's start
of performance (5/7/93) (cumulative) and start of performance (5/7/93) to
11/30/99. The total returns were 14.56%, 25.45%, 230.50% and 19.96%,
respectively.
A10 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class Y
Shares of Wachovia Equity Index Fund are represented by a solid line. The
Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line. The
line graph is a visual representation of a comparison of change in value of a
$10,000 hypothetical investment in the Class Y Shares of the fund, and the S&P
500. The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y"
axis reflects the cost of the investment. The right margin reflects the ending
value of the hypothetical investment in the fund's Class Y Shares, as compared
to the S&P 500. The ending values were $22,738, and $23,397, respectively. The
legend in the bottom quadrant of the graphic presentation indicates the fund's
Class Y Shares Average Annual Total Returns for the one-year period ended
11/30/99 and from the fund's start of performance (7/23/93) (cumulative) and
start of performance (7/23/93) to 11/30/99. The total returns were 20.24%,
127.38% and 27.71%, respectively.
A11 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class A
Shares of Wachovia Special Values Fund based on a 4.50% sales load are
represented by a solid line. The Russell 2000 Index (the "Russell 2000") is
represented by a dotted line. The line graph is a visual representation of a
comparison of change in value of a $10,000 hypothetical investment in the Class
A Shares of the fund, and the Russell 2000. The "x" axis reflects computation
periods from 5/7/93 to 11/30/99. The "y" axis reflects the cost of the
investment. The right margin reflects the ending value of the hypothetical
investment in the fund's Class A Shares, based on a 4.50% sales load, as
compared to the Russell 2000. The ending values were $20,183, and $22,839,
respectively. The legend in the bottom quadrant of the graphic presentation
indicates the fund's Class A Shares Average Annual Total Returns for the
one-year and five-year periods ended 11/30/99 and from the fund's start of
performance (5/7/93) (cumulative) and start of performance (5/7/93) to 11/30/99.
The total returns were 0.66%, 17.78%, 128.39% and 13.39%, respectively.
A12 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class B
Shares of Wachovia Special Values Fund are represented by a solid line. The
Russell 2000 Index (the "Russell 2000") is represented by a dotted line. The
line graph is a visual representation of a comparison of change in value of a
$10,000 hypothetical investment in the Class A Shares of the fund, and the
Russell 2000. The "x" axis reflects computation periods from 3/26/99 to
11/30/99. The "y" axis reflects the cost of the investment. The right margin
reflects the ending value of the hypothetical investment in the fund's Class B
Shares, as compared to the Russell 2000. The ending values were $10,452, and
$11,633, respectively. The legend in the bottom quadrant of the graphic
presentation indicates the fund's Class B Shares Average Annual Total Returns
from the fund's start of performance (5/7/93) (cumulative) to 11/30/99. The
total returns was 4.52.
A13 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class Y
Shares of Wachovia Special Values are represented by a solid line. The Russell
2000 Index (the "Russell 2000") is represented by a dotted line. The line graph
is a visual representation of a comparison of change in value of a $10,000
hypothetical investment in the Class Y Shares of the fund, and the Russell 2000.
The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis
reflects the cost of the investment. The right margin reflects the ending value
of the hypothetical investment in the fund's Class Y Shares, as compared to the
Russell 2000. The ending values were $15,615, and $14,759, respectively. The
legend in the bottom quadrant of the graphic presentation indicates the fund's
Class Y Shares Average Annual Total Returns for the one-year period ended
11/30/99 and from the fund's start of performance (7/23/96) (cumulative) and
start of performance (7/23/96) to 11/30/99. The total returns were 5.61%, 56.15%
and 14.19%, respectively.
A14 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class A
Shares of Wachovia Emerging Markets Fund based on a 4.50% sales load are
represented by a solid line. The International Finance Corporation Investable
Index (the "IFCI") is represented by a dotted line. The line graph is a visual
representation of a comparison of change in value of a $10,000 hypothetical
investment in the Class A Shares of the fund, and the IFCA. The "x" axis
reflects computation periods from 12/23/94 to 11/30/99. The "y" axis reflects
the cost of the investment. The right margin reflects the ending value of the
hypothetical investment in the fund's Class A Shares, based on a 4.50% sales
load, as compared to the IFCA. The ending values were $11,529, and $9,767,
respectively. The legend in the bottom quadrant of the graphic presentation
indicates the fund's Class A Shares Average Annual Total Returns for the
one-year period ended 11/30/99 and from the fund's start of performance
(12/22/94) (cumulative) and start of performance (12/23/94) to 11/30/99. The
total returns were 33.72%, 15.29% and 2.92%, respectively.
A15 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class Y
Shares of Wachovia Emerging Markets Fund are represented by a solid line. The
International Finance Corporation Investable Index (the "IFCI") is represented
by a dotted line. The line graph is a visual representation of a comparison of
change in value of a $10,000 hypothetical investment in the Class Y Shares of
the fund, and the IFCA. The "x" axis reflects computation periods from 7/23/96
to 11/30/99. The "y" axis reflects the cost of the investment. The right margin
reflects the ending value of the hypothetical investment in the fund's Class Y
Shares, compared to the IFCA. The ending values were $10,153, and $9,859,
respectively. The legend in the bottom quadrant of the graphic presentation
indicates the fund's Class A Shares Average Annual Total Returns for the
one-year period ended 11/30/99 and from the fund's start of performance
(7/23/96) (cumulative) and start of performance (17/23/96) to 11/30/99. The
total returns were 40.39%, 1.53% and 0.45%, respectively.
A16 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class A
Shares of Wachovia Personal Equity Fund based on a 4.50% sales load are
represented by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is
represented by a dotted line. The line graph is a visual representation of a
comparison of change in value of a $10,000 hypothetical investment in the Class
A Shares of the fund, and the S&P 500. The "x" axis reflects computation periods
from 7/30/99 to 11/30/99. The "y" axis reflects the cost of the investment. The
right margin reflects the ending value of the hypothetical investment in the
fund's Class A Shares, based on a 4.50% sales load, as compared to the S&P500.
The ending values were $10,196 and $11,483, respectively. The legend in the
bottom quadrant of the graphic presentation indicates the fund's Class A Shares
Average Annual Total Returns for the fund's start of performance (12/22/94)
(cumulative) to 11/30/99. The total returns were 1.96%
A17 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class Y
Shares of Wachovia Personal Equity Fund are represented by a solid line. The
Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line. The
line graph is a visual representation of a comparison of change in value of a
$10,000 hypothetical investment in the Class Y Shares of the fund, and the S&P
500. The "x" axis reflects computation periods from 7/30/99 to 11/30/99. The "y"
axis reflects the cost of the investment. The right margin reflects the ending
value of the hypothetical investment in the fund's Class Y Shares, as compared
to the S&P500. The ending values were $10,685 and $11,483, respectively. The
legend in the bottom quadrant of the graphic presentation indicates the fund's
Class A Shares Average Annual Total Returns for the fund's start of performance
(12/22/94) (cumulative) to 11/30/99. The total returns were 6.85%.
A18 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class A
Shares of Wachovia Balanced Fund based on a 4.50% sales load are represented by
a solid line. The Standard & Poor's 500 Index (the "S&P 500") is represented by
a dotted line and the Lehman Brothers Aggregate Bond Index (the "LBABI"). The
line graph is a visual representation of a comparison of change in value of a
$10,000 hypothetical investment in the Class A Shares of the fund, the S&P 500
and the LBABI. The "x" axis reflects computation periods from 5/7/93 to
11/30/99. The "y" axis reflects the cost of the investment. The right margin
reflects the ending value of the hypothetical investment in the fund's Class A
Shares, based on a 4.50% sales load, as compared to the S&P 500, and the LBABI.
The ending values were $22,429, $36,086 and $14,730, respectively. The legend in
the bottom quadrant of the graphic presentation indicates the fund's Class A
Shares Average Annual Total Returns for the one-year and five-year periods ended
11/30/99 and from the fund's start of performance (5/7/93) (cumulative) and
start of performance (5/7/93) to 11/30/99. The total returns were 8.80%, 16.50%,
124.29% and 13.08%, respectively.
A19 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class B
Shares of Wachovia Balanced Fund are represented by a solid line. The Standard &
Poor's 500 Index (the "S&P 500") is represented by a dotted line and the Lehman
Brothers Aggregate Bond Index (the "LBABI"). The line graph is a visual
representation of a comparison of change in value of a $10,000 hypothetical
investment in the Class B Shares of the fund, the S&P 500 and the LBABI. The "x"
axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis
reflects the cost of the investment. The right margin reflects the ending value
of the hypothetical investment in the fund's Class B Shares, as compared to the
S&P 500, and the LBABI. The ending values were $16,485, $23,397 and $12,247,
respectively. The legend in the bottom quadrant of the graphic presentation
indicates the fund's Class A Shares Average Annual Total Returns for the
one-year period ended 11/30/99 and from the fund's start of performance
(7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total
returns were 8.18%, 64.85% and 16.05%, respectively.
A20 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class Y
Shares of Wachovia Balanced Fund are represented by a solid line. The Standard &
Poor's 500 Index (the "S&P 500") is represented by a dotted line and the Lehman
Brothers Aggregate Bond Index (the "LBABI"). The line graph is a visual
representation of a comparison of change in value of a $10,000 hypothetical
investment in the Class Y Shares of the fund, the S&P 500 and the LBABI. The "x"
axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis
reflects the cost of the investment. The right margin reflects the ending value
of the hypothetical investment in the fund's Class Y Shares, as compared to the
S&P 500, and the LBABI. The ending values were $17,344, $23,397 and $12,247,
respectively. The legend in the bottom quadrant of the graphic presentation
indicates the fund's Class A Shares Average Annual Total Returns for the
one-year period ended 11/30/99 and from the fund's start of performance
(7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total
returns were 14.21%, 73.44% and 17.82%, respectively.
A21 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class A
Shares of Wachovia Fixed Income Fund based on a 4.50% sales load are represented
by a solid line. The Lehman Brothers Aggregate Bond Index (the "LBABI") is
represented by a dotted line. The line graph is a visual representation of a
comparison of change in value of a $10,000 hypothetical investment in the Class
A Shares of the fund, and the LBABI. The "x" axis reflects computation periods
from 5/7/93 to 11/30/99. The "y" axis reflects the cost of the investment. The
right margin reflects the ending value of the hypothetical investment in the
fund's Class A Shares, based on a 4.50% sales load, as compared to the LBABI.
The ending values were, $13,323 and $14,730, respectively. The legend in the
bottom quadrant of the graphic presentation indicates the fund's Class A Shares
Average Annual Total Returns for the one-year and five-year periods ended
11/30/99 and from the fund's start of performance (5/7/93) (cumulative) and
start of performance (5/7/93) to 11/30/99. The total returns were (5.26)%,
6.21%, 33.23% and 4.46%, respectively.
A22 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class B
Shares of Wachovia Fixed Income Fund are represented by a solid line. The Lehman
Brothers Aggregate Bond Index (the "LBABI") is represented by a dotted line. The
line graph is a visual representation of a comparison of change in value of a
$10,000 hypothetical investment in the Class B Shares of the fund, and the
LBABI. The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The
"y" axis reflects the cost of the investment. The right margin reflects the
ending value of the hypothetical investment in the fund's Class B Shares, as
compared to the LBABI. The ending values were, $11,541 and $12,427,
respectively. The legend in the bottom quadrant of the graphic presentation
indicates the fund's Class B Shares Average Annual Total Returns for the
one-year period ended 11/30/99 and from the fund's start of performance
(7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total
returns were (6.21)%, 15.41% and 4.36%, respectively.
A23 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class Y
Shares of Wachovia Fixed Income Fund are represented by a solid line. The Lehman
Brothers Aggregate Bond Index (the "LBABI") is represented by a dotted line. The
line graph is a visual representation of a comparison of change in value of a
$10,000 hypothetical investment in the Class Y Shares of the fund, and the
LBABI. The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The
"y" axis reflects the cost of the investment. The right margin reflects the
ending value of the hypothetical investment in the fund's Class Y Shares, as
compared to the LBABI. The ending values were, $12,231 and $12,427,
respectively. The legend in the bottom quadrant of the graphic presentation
indicates the fund's Class Y Shares Average Annual Total Returns for the
one-year period ended 11/30/99 and from the fund's start of performance
(7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total
returns were (0.53)%, 22.31% and 6.18%, respectively.
A24 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class A
Shares of Wachovia Intermediate Fixed Income Fund based on a 4.50% sales load
are represented by a solid line. The Lehman Brothers Gov.t/ Corp. Intermediate
Index (the "LBGCII") is represented by a dotted line. The line graph is a visual
representation of a comparison of change in value of a $10,000 hypothetical
investment in the Class A Shares of the fund, and the LBGCII. The "x" axis
reflects computation periods from 1/29/93 to 11/30/99. The "y" axis reflects the
cost of the investment. The right margin reflects the ending value of the
hypothetical investment in the fund's Class A Shares, based on a 4.50% sales
load, as compared to the LBGCII. The ending values were, $13,338 and $14,616,
respectively. The legend in the bottom quadrant of the graphic presentation
indicates the fund's Class A Shares Average Annual Total Returns for the
one-year and five-year periods ended 11/30/99 and from the fund's start of
performance (1/29/93) (cumulative) and start of performance (1/29/93) to
11/30/99. The total returns were (5.50)%, 5.61%, 33.38% and 4.30%, respectively.
A25 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class Y
Shares of Wachovia Intermediate Fixed Income Fund are represented by a solid
line. The Lehman Brothers Gov.t/ Corp. Intermediate Index (the "LBGCII") is
represented by a dotted line. The line graph is a visual representation of a
comparison of change in value of a $10,000 hypothetical investment in the Class
Y Shares of the fund, and the LBGCII. The "x" axis reflects computation periods
from 3/29/98 to 11/30/99. The "y" axis reflects the cost of the investment. The
right margin reflects the ending value of the hypothetical investment in the
fund's Class Y Shares, as compared to the LBGCII. The ending values were,
$10,626 and $10,629, respectively. The legend in the bottom quadrant of the
graphic presentation indicates the fund's Class Y Shares Average Annual Total
Returns for the one-year period ended 11/30/99 and from the fund's start of
performance (3/29/98) (cumulative) and start of performance (3/29/9893) to
11/30/99. The total returns were (0.77)%, 6.28%, and 3.71%, respectively.
A26 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class A
Shares of Wachovia Short-Term Fixed Income Fund based on a 4.50% sales load are
represented by a solid line. The Merrill Lynch 1-3 Year U.S. Treasury Index is
represented by a dotted line. The line graph is a visual representation of a
comparison of change in value of a $10,000 hypothetical investment in the Class
A Shares of the fund, and the Merrill Lynch 1-3 Year U.S. Treasury Index. The
"x" axis reflects computation periods from 5/7/93 to 11/30/99. The "y" axis
reflects the cost of the investment. The right margin reflects the ending value
of the hypothetical investment in the fund's Class A Shares, based on a 4.50%
sales load, as compared to the Merrill Lynch 1-3 Year U.S. Treasury Index. The
ending values were, $12,973 and $14,090, respectively. The legend in the bottom
quadrant of the graphic presentation indicates the fund's Class A Shares Average
Annual Total Returns for the one-year and five-year periods ended 11/30/99 and
from the fund's start of performance (5/7/93) (cumulative) and start of
performance (5/7/93) to 11/30/99. The total returns were (0.08)%, 5.15%, 32.38%
and 4.36%, respectively.
A27 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class Y
Shares of Wachovia Short-Term Fixed Income Fund are represented by a solid line.
The Merrill Lynch 1-3 Year U.S. Treasury Index is represented by a dotted line.
The line graph is a visual representation of a comparison of change in value of
a $10,000 hypothetical investment in the Class Y Shares of the fund, and the
Merrill Lynch 1-3 Year U.S. Treasury Index. The "x" axis reflects computation
periods from 7/23/96 to 11/30/99. The "y" axis reflects the cost of the
investment. The right margin reflects the ending value of the hypothetical
investment in the fund's Class Y Shares, , as compared to the Merrill Lynch 1-3
Year U.S. Treasury Index. The ending values were, $11,943 and $12,144,
respectively. The legend in the bottom quadrant of the graphic presentation
indicates the fund's Class Y Shares Average Annual Total Returns for the
one-year period ended 11/30/99 and from the fund's start of performance
(7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total
returns were 2.70%, 19.43% and 5.43%, respectively.
A28 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class A
Shares of Wachovia Georgia Municipal Bond Fund based on a 4.50% sales load are
represented by a solid line. The Lehman Brothers State General Obligation Bond
Index (LBSGOBI) is represented by a dotted line and the Lehman Brothers
Municipal Bond Index (LBMBI) is represented by a dashed line. The line graph is
a visual representation of a comparison of change in value of a $10,000
hypothetical investment in the Class A Shares of the fund, and the LBSGOBI and
the LBMBI. The "x" axis reflects computation periods from 12/23/94 to 11/30/99.
The "y" axis reflects the cost of the investment. The right margin reflects the
ending value of the hypothetical investment in the fund's Class A Shares, based
on a 4.50% sales load, as compared to the LBSGOBI and the LBMBI. The ending
values were, $12,442, $13,942 and $14,383, respectively. The legend in the
bottom quadrant of the graphic presentation indicates the fund's Class A Shares
Average Annual Total Returns for the one-year period ended 11/30/99 and from the
fund's start of performance (12/23/94) (cumulative) and start of performance
(12/23/94) to 11/30/99. The total returns were (7.23)%, 24.42% and 4.52%,
respectively.
A29 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class Y
Shares of Wachovia Georgia Municipal Bond Fund are represented by a solid line.
The Lehman Brothers State General Obligation Bond Index (LBSGOBI) is represented
by a dotted line and the Lehman Brothers Municipal Bond Index (LBMBI) is
represented by a dashed line. The line graph is a visual representation of a
comparison of change in value of a $10,000 hypothetical investment in the Class
Y Shares of the fund, and the LBSGOBI and the LBMBI. The "x" axis reflects
computation periods from 7/23/96 to 11/30/99. The "y" axis reflects the cost of
the investment. The right margin reflects the ending value of the hypothetical
investment in the fund's Class Y Shares, as compared to the LBSGOBI and the
LBMBI. The ending values were, $11,443, $12,035 and $11,896, respectively. The
legend in the bottom quadrant of the graphic presentation indicates the fund's
Class Y Shares Average Annual Total Returns for the one-year period ended
11/30/99 and from the fund's start of performance (7/23/96) (cumulative) and
start of performance (7/23/96) to 11/30/99. The total returns were (2.59)%,
14.43% and 4.10%, respectively.
A30 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class A
Shares of Wachovia North Carolina Municipal Bond Fund based on a 4.50% sales
load are represented by a solid line. The Lehman Brothers State General
Obligation Bond Index (LBSGOBI) is represented by a dotted line and the Lehman
Brothers Municipal Bond Index (LBMBI) is represented by a dashed line. The line
graph is a visual representation of a comparison of change in value of a $10,000
hypothetical investment in the Class A Shares of the fund, and the LBSGOBI and
the LBMBI. The "x" axis reflects computation periods from 12/23/94 to 11/30/99.
The "y" axis reflects the cost of the investment. The right margin reflects the
ending value of the hypothetical investment in the fund's Class A Shares, based
on a 4.50% sales load, as compared to the LBSGOBI and the LBMBI. The ending
values were, $12,631, $13,942 and $14,383, respectively. The legend in the
bottom quadrant of the graphic presentation indicates the fund's Class A Shares
Average Annual Total Returns for the one-year period ended 11/30/99 and from the
fund's start of performance (12/23/94) (cumulative) and start of performance
(12/23/94) to 11/30/99. The total returns were (6.73)%, 26.31% and 4.84%,
respectively.
A31 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class Y
Shares of Wachovia North Carolina Municipal Bond Fund are represented by a solid
line. The Lehman Brothers State General Obligation Bond Index (LBSGOBI) is
represented by a dotted line and the Lehman brothers Municipal Bond Index
(LBMBI) is represented by a dashed line. The line graph is a visual
representation of a comparison of change in value of a $10,000 hypothetical
investment in the Class Y Shares of the fund, and the LBSGOBI and the LBMBI. The
"x" axis reflects computation periods from 12/23/94 to 11/30/99. The "y" axis
reflects the cost of the investment. The right margin reflects the ending value
of the hypothetical investment in the fund's Class Y Shares, as compared to the
LBSGOBI and the LBMBI. The ending values were, $11,573, $11,896 and $12,035,
respectively. The legend in the bottom quadrant of the graphic presentation
indicates the fund's Class A Shares Average Annual Total Returns for the
one-year period ended 11/30/99 and from the fund's start of performance
(7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total
returns were (2.09)%, 15.73% and 4.44%, respectively.
A32 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class A
Shares of Wachovia South Carolina Municipal Bond Fund based on a 4.50% sales
load are represented by a solid line. The Lehman Brothers State General
Obligation Bond Index (LBSGOBI) is represented by a dotted line and the Lehman
Brothers Municipal Bond Index (LBMBI) is represented by a dashed line. The line
graph is a visual representation of a comparison of change in value of a $10,000
hypothetical investment in the Class A Shares of the fund, and the LBSGOBI and
the LBMBI. The "x" axis reflects computation periods from 1/11/91 to 11/30/99.
The "y" axis reflects the cost of the investment. The right margin reflects the
ending value of the hypothetical investment in the fund's Class A Shares, based
on a 4.50% sales load, as compared to the LBSGOBI and the LBMBI. The ending
values were, $16,323, $17,869 and $18,827, respectively. The legend in the
bottom quadrant of the graphic presentation indicates the fund's Class A Shares
Average Annual Total Returns for the one-year and five-year periods ended
11/30/99 and from the fund's start of performance (1/11/91) (cumulative) and
start of performance (1/11/91) to 11/30/99. The total returns were (6.91)%, ,
5.44%, 63.23% and 5.67%, respectively.
A33 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class Y
Shares of Wachovia South Carolina Municipal Bond Fund are represented by a solid
line. The Lehman Brothers State General Obligation Bond Index (LBSGOBI) is
represented by a dotted line and the Lehman Brothers Municipal Bond Index
(LBMBI) is represented by a dashed line. The line graph is a visual
representation of a comparison of change in value of a $10,000 hypothetical
investment in the Class Y Shares of the fund, and the LBSGOBI and the LBMBI. The
"x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis
reflects the cost of the investment. The right margin reflects the ending value
of the hypothetical investment in the fund's Class Y Shares, as compared to the
LBSGOBI and the LBMBI. The ending values were, $11,668, $11,896 and $12,035,
respectively. The legend in the bottom quadrant of the graphic presentation
indicates the fund's Class A Shares Average Annual Total Returns for the
one-year period ended 11/30/99 and from the fund's start of performance
(7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total
returns were (2.24)%, 16.68% and 4.70%, respectively.
A34 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class A
Shares of Wachovia Virginia Municipal Bond Fund based on a 4.50% sales load are
represented by a solid line. The Lehman Municipal Bond Index (LBMBI) is
represented by a dotted line and the Lehman Brothers Municipal Bond 7-Year Index
(LBMB7YI) is represented by a dashed line. The line graph is a visual
representation of a comparison of change in value of a $10,000 hypothetical
investment in the Class A Shares of the fund, and the LBMBI and the LBMB7YI. The
"x" axis reflects computation periods from 2/1/93 to 11/30/99. The "y" axis
reflects the cost of the investment. The right margin reflects the ending value
of the hypothetical investment in the fund's Class A Shares, based on a 4.50%
sales load, as compared to the LBMBI and the LBMB7YI. The ending values were,
$12,515, $14,813 and $14,458, respectively. The legend in the bottom quadrant of
the graphic presentation indicates the fund's Class A Shares Average Annual
Total Returns for the one-year and five-year periods ended 11/30/99 and from the
fund's start of performance (2/1/93) (cumulative) and start of performance
(2/1/93) to 11/30/99. The total returns were (6.38)%, 4.52%, 25.15% and 3.34%,
respectively.
A35 The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class Y
Shares of Wachovia Virginia Municipal Bond Fund are represented by a solid line.
The Lehman Municipal Bond Index (LBMBI) is represented by a dotted line and the
Lehman Brothers Municipal Bond 7-Year Index (LBMB7YI) is represented by a dashed
line. The line graph is a visual representation of a comparison of change in
value of a $10,000 hypothetical investment in the Class Y Shares of the fund,
and the LBMBI and the LBMB7YI. The "x" axis reflects computation periods from
3/29/98 to 11/30/99. The "y" axis reflects the cost of the investment. The right
margin reflects the ending value of the hypothetical investment in the fund's
Class Y Shares, as compared to the LBMBI and the LBMB7YI. The ending values
were, $10,276, $10,388 and $10,531, respectively. The legend in the bottom
quadrant of the graphic presentation indicates the fund's Class Y Shares Average
Annual Total Returns for the one-year period ended 11/30/99 and from the fund's
start of performance (3/29/98) (cumulative) and start of performance (3/29/98)
to 11/30/99. The total returns were (1.76)%, 2.76% and 1.64%, respectively.
