<PAGE> 1
[PIC LOGO] P-I-C
INSTITUTIONAL
-------------------------
SMALL CAP FUND
GROWTH FUND-BALANCED FUND
-------------------------
Annual Report
October 31, 1996
<PAGE> 2
[PIC LOGO] P-I-C MESSAGE TO SHAREHOLDERS
INSTITUTIONAL
-------------------------
SMALL CAP FUND
GROWTH FUND-BALANCED FUND
-------------------------
- --------------------------------------------------------------------------------
THE FOLLOWING IS AN INTERVIEW WITH THE MEMBERS OF THE INVESTMENT TEAM AT
PROVIDENT INVESTMENT COUNSEL.
QUESTION: How did the P-I-C Institutional Balanced Fund perform relative to the
overall markets during the fiscal year ended October 31, 1996 as well as during
1996 through October 31?
ANSWER: The Lipper Balanced Fund Index, a group of several hundred balanced
mutual funds, rose 14.49% for the fiscal year and 9.32% from January 1, 1996
through October 31, while the Fund's total returns were 11.96% and 13.90% in the
same periods.
QUESTION: What are some of the factors that have caused volatility in the bond
market in 1996?
ANSWER: By way of background, we discussed in our Semi-Annual Report how the
year began with a very positive environment for the bond market because of
prospects for a slowly weakening economy. As we moved further along during the
year, the economy showed some signs of strength, causing volatility in the bond
market as investors feared inflationary pressures were growing. These fears led
to concerns that the Federal Reserve would be forced to raise interest rates if
further signs of strength were confirmed. However, although many of America's
fastest growing companies continued to post strong earnings results, the growth
of the economy as a whole showed signs of continued slowing in the third
quarter. This was confirmed with the release of the third quarter GDP growth
number of 2%.
QUESTION: Has the allocation between bonds and equities in the Balanced Fund
changed much during the year?
ANSWER: For the most part, the Fund has maintained an allocation of 70% of its
assets in equities and 30% in senior fixed income securities and cash
equivalents, in keeping with the Fund's objectives. We expect to maintain this
allocation, given our outlook for 1997 which includes relatively little change
upward or downward in the growth of the economy.
QUESTION: How did the P-I-C Institutional Growth Fund perform relative to the
overall markets during the fiscal year ended October 31, 1996 as well as during
1996 through October 31?
2
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[PIC LOGO] P-I-C MESSAGE TO SHAREHOLDERS
INSTITUTIONAL
-------------------------
SMALL CAP FUND
GROWTH FUND-BALANCED FUND
-------------------------
- --------------------------------------------------------------------------------
ANSWER: The Standard & Poor's 500 Stock Index, a broad measure of the market's
overall performance, rose 24.09% for the fiscal year and 16.63% for the calendar
year to date, while the Fund's total returns were 14.04% and 18.61%. The Lipper
Growth Fund Index, a database of several hundred growth oriented mutual funds,
rose 16.94% and 12.63% in the same periods.
QUESTION: Both the broad stock market and the Fund have continued to advance in
a meaningful way in 1996. What are some of the factors contributing to this
rise?
ANSWER: The combination of continued strong earnings reports in a broad range of
sectors, moderate levels of inflation and record inflows of new investment in
equity mutual funds has moved the market to higher levels. Currently, a majority
of the new cash flow into the equity markets is gravitating towards large
capitalization, "blue chip" companies.
QUESTION: What sectors have helped the Growth Fund outperform the broad market
in 1996?
ANSWER: The technology sector has been strong through 1996, with market leaders
such as Microsoft, Oracle and Computer Associates leading the way. The financial
services sector has also been consistently strong throughout the year, led by
credit card companies such as First USA and MBNA, and more recently by mortgage
industry leaders MGIC Investment Corporation and the Federal Home Loan Mortgage
Corporation. The Fund has also been helped along the way by consumer services
companies such as Hospitality Franchise System and CUC International, along with
Circus Circus and Mirage Resorts.
QUESTION: What are some of the companies that have been added to the Growth
Fund since the last report in April?
ANSWER: In the technology sector, the Fund has added Lucent Technologies, a
spin-off of AT&T's equipment-making operations, and Ascend Communications, a
developer of wide area network communications products. The Fund has also added
several retail concerns, such as Price/Costco, Walgreen's discount drug stores,
CVS Corporation -- also a retail chain operation, and Safeway Food Stores, which
is in the process of acquiring Von's Stores, another large retail food chain in
California. Other recent purchases include Nike Inc. and the oil refining and
services companies, Schlumberger and Tosco.
3
<PAGE> 4
[PIC LOGO] P-I-C MESSAGE TO SHAREHOLDERS
INSTITUTIONAL
-------------------------
SMALL CAP FUND
GROWTH FUND-BALANCED FUND
-------------------------
- --------------------------------------------------------------------------------
QUESTION: How did the P-I-C Institutional Small Cap. Fund perform relative to
the overall markets during the fiscal year ended October 31, 1996 as well as
during 1996 through October 31?
ANSWER: The Standard & Poor's 500 Stock Index, a broad measure of the market's
overall performance, rose 24.09% for the fiscal year and 16.63% for the calendar
year to date. The Small Cap. Fund did not commence operations until June 28,
1996, but it invests exclusively in the P-I-C Small Cap. Portfolio, which has
been operating since September 30, 1993. If the Small Cap. Fund had been in
existence, its total returns, based on the returns of the P-I-C Small Cap.
Portfolio, would have been 23.34% and 16.96%. (From June 28, 1996, the date the
Small Cap. Fund began operations, until October 31, 1996, the actual total
return of the Small Cap. Fund was -5.20%.)
The Russell 2000 Growth Index, a broad measure of smaller capitalization growth
stocks, rose 13.33% and 6.12% for those periods.
QUESTION: What has fueled the Small Cap. Fund's positive performance over the
last 12 months?
ANSWER: In addition to the strong earnings reports and lack of inflationary
pressure, which have been forces behind the broad market performance, there have
been record inflows of cash into equity mutual funds, especially those with a
small stock orientation.
QUESTION: What sectors have helped the Small Cap. Fund's performance during the
last 12 months?
ANSWER: The technology, healthcare/medical and financial sectors have been the
best performing for the Fund during the last year. The research process at PIC
is bottom-up, and we do not have any predetermined investment guidelines for
industry or sector weightings in the Fund. The percentages allocated to these
areas are simply the result of this stock selection approach.
QUESTION: Have there been any significant changes in the Fund's exposure to
certain sectors?
ANSWER: Again, as a result of our stock selection approach we have seen some
changes over the year including a reduction in the Fund's exposure to the
technology area and a modestly increased exposure to the consumer non-durable
and industrial areas.
4
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[PIC LOGO] P-I-C MESSAGE TO SHAREHOLDERS
INSTITUTIONAL
-------------------------
SMALL CAP FUND
GROWTH FUND-BALANCED FUND
-------------------------
- --------------------------------------------------------------------------------
QUESTION: What is the outlook for all three Funds in 1997?
ANSWER: We are generally optimistic for the year, because we expect 1997 to be
characterized by slower growth, low unemployment and little inflationary
pressure. Under this scenario, economic growth is expected to expand at an
overall rate of about 2%.
With this in mind, it is very likely that the Federal Reserve will leave
monetary policy unchanged. Until we see signs that current conditions are
changing, and barring some unexpected shock to the economy, we are maintaining a
duration-neutral policy for the fixed income portion of the Balanced Fund.
We are optimistic about the earnings valuations of the stocks held by all three
Funds, relative to their growth rates as compared to the broad market. We are
looking forward to an environment in 1997 that will place a higher premium on
the ability to select those companies that will continue to deliver strong sales
and earnings growth in any economic or market scenario. In past periods of
relatively slow economic growth, companies that have the ability to sustain high
rates of growth have been rewarded. As always, our focus will be on selecting
those companies that we believe will deliver consistent high rates of growth
under any economic circumstances.
5
<PAGE> 6
[PIC LOGO] P-I-C MESSAGE TO SHAREHOLDERS
INSTITUTIONAL
-------------------------
SMALL CAP FUND
GROWTH FUND-BALANCED FUND
-------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
P-I-C BALANCED PORTFOLIO (EQUITY HOLDINGS) VS. S&P 500*
- -----------------------------------------------------------------------------------------------------------------
3-YEAR SALES 3-YEAR EARNINGS 3-YEAR DIVIDEND PRETAX RETURN ON REINVEST. RATE
GROWTH PER SHARE PER SHARE MARGIN EQUITY
GROWTH GROWTH
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
P-I-C (equity holdings) 23.7% 31.1% 17.1% 17.5% 22.4% 20.3%
S&P 500 5.6% 16.3% 4.2% 9.3% 18.7% 10.8%
- -----------------------------------------------------------------------------------------------------------------
*As of 10/31/96
</TABLE>
<TABLE>
<CAPTION>
P-I-C GROWTH PORTFOLIO VS. S&P 500*
- -----------------------------------------------------------------------------------------------------------------
3-YEAR SALES 3-YEAR EARNINGS 3-YEAR DIVIDEND PRETAX RETURN ON REINVEST. RATE
GROWTH PER SHARE PER SHARE MARGIN EQUITY
GROWTH GROWTH
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
P-I-C (equity holdings) 23.7% 31.1% 17.1% 17.5% 22.4% 20.3%
S&P 500 5.6% 16.3% 4.2% 9.3% 18.7% 10.8%
- -----------------------------------------------------------------------------------------------------------------
*As of 10/31/96
</TABLE>
6
<PAGE> 7
[PIC LOGO] P-I-C MESSAGE TO SHAREHOLDERS
INSTITUTIONAL
-------------------------
SMALL CAP FUND
GROWTH FUND-BALANCED FUND
-------------------------
- --------------------------------------------------------------------------------
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN P-I-C
INSTITUTIONAL BALANCED FUND, THE S&P 500 STOCK INDEX AND A
COMPOSITE OF THE S&P 500 STOCK INDEX AND THE LEHMAN
GOVERNMENT/CORPORATE BOND INDEX
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
P-I-C Institutional Balanced Fund S&P 500 Composite
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
07/92 $10,000 $10,000 $10,000
10/92 $10,820 $10,300 $10,500
04/93 $10,785 $11,300 $11,000
10/93 $11,697 $11,900 $11,400
04/94 $10,996 $11,600 $11,000
10/94 $11,606 $12,400 $11,600
04/95 $11,697 $13,600 $12,700
10/95 $13,851 $15,600 $14,400
04/96 $14,371 $17,800 $15,400
10/96 $15,507 $19,400 $16,700
- --------------------------------------------------------------------------------
</TABLE>
<TABLE>
<S> <C>
One year 11.96%
Since inception 10.51%
</TABLE>
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN P-I-C
INSTITUTIONAL GROWTH FUND AND THE S&P 500 STOCK INDEX.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
P-I-C Institutional Growth Fund S&P 500
- --------------------------------------------------------------------------------
<S> <C> <C>
07/92 $10,000 $10,000
10/92 $10,810 $10,300
04/93 $10,349 $11,300
10/93 $11,610 $11,900
04/94 $10,950 $11,600
10/94 $11,710 $12,400
04/95 $11,710 $13,600
10/95 $14,263 $15,600
04/96 $14,883 $17,800
10/96 $16,265 $19,400
- --------------------------------------------------------------------------------
</TABLE>
<TABLE>
<S> <C>
One year 14.04%
Since inception 11.71%
</TABLE>
7
<PAGE> 8
[PIC LOGO] P-I-C MESSAGE TO SHAREHOLDERS
INSTITUTIONAL
-------------------------
SMALL CAP FUND
GROWTH FUND-BALANCED FUND
-------------------------
- --------------------------------------------------------------------------------
P-I-C SMALL CAP. PORTFOLIO VS. RUSSELL 2000 GROWTH*
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
3-YEAR SALES 3-YEAR EARNINGS PRETAX RETURN ON REINVEST. RATE
GROWTH PER SHARE MARGIN EQUITY
GROWTH
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
P-I-C 38.7% 39.1% 16.4% 23.0% 22.6%
RUSSELL 2000 GROWTH 27.9% 30.7% 13.9% 18.5% 16.9%
- ---------------------------------------------------------------------------------------------------
</TABLE>
Performance results reflect the total returns of the P-I-C Small Cap Growth Fund
(included in another report) managed by Provident Investment Council prior to
the effective date of the Fund's registration statement, which was 6/28/96.
P-I-C Small Cap Growth Fund returns are restated to reflect all fees and
expenses applicable to the P-I-C Institutional Small Cap Fund.
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN P-I-C
INSTITUTIONAL SMALL CAP. FUND AND THE RUSSELL 2000 GROWTH INDEX.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
P-I-C Institutional Small Cap. Fund S&P 500
- --------------------------------------------------------------------------------
<S> <C> <C>
10/01/93 $10,000 $10,000
04/94 $ 9,450 $ 9,900
10/94 $10,010 $10,200
04/95 $10,435 $10,700
10/95 $14,435 $12,300
04/96 $18,609 $14,900
10/96 $18,700 $13,900
- --------------------------------------------------------------------------------
</TABLE>
<TABLE>
<S> <C>
One Year 24.08%
Since inception 21.09%
</TABLE>
8
<PAGE> 9
[PIC LOGO] P-I-C STATEMENT OF ASSETS AND LIABILITIES
INSTITUTIONAL AS OF OCTOBER 31, 1996
-------------------------
SMALL CAP FUND
GROWTH FUND-BALANCED FUND
-------------------------
<TABLE>
<CAPTION>
BALANCED - FUND
================================================================================
ASSETS
- --------------------------------------------------------------------------------
<S> <C>
Investment in P-I-C Balanced Portfolio, at value $12,868,303
Receivables:
From Provident Investment Counsel (Note 3) 15,702
Fund shares sold 584
For investments sold in P-I-C
Balanced Portfolio 2,017
Deferred organization costs 4,576
- --------------------------------------------------------------------------------
Total assets 12,891,182
================================================================================
LIABILITIES
- --------------------------------------------------------------------------------
Payables:
Fund shares redeemed 2,017
For investments purchased in P-I-C
Balanced Portfolio 584
Deferred Trustees' compensation (Note 3) 5,405
Accrued expenses 14,972
- --------------------------------------------------------------------------------
Total liabilities 22,978
================================================================================
NET ASSETS
- --------------------------------------------------------------------------------
Applicable to 924,780 shares of beneficial interest
outstanding $12,868,204
================================================================================
NET ASSET VALUE PER SHARE $ 13.91
- --------------------------------------------------------------------------------
================================================================================
SOURCE OF NET ASSETS
- --------------------------------------------------------------------------------
Paid-in capital $ 9,405,969
Undistributed net investment income 10,589
Accumulated net realized gain on investments 943,127
Net unrealized appreciation on investments 2,508,519
================================================================================
NET ASSETS $12,868,204
- --------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
9
<PAGE> 10
[PIC LOGO] P-I-C STATEMENT OF OPERATIONS
INSTITUTIONAL Year ended October 31, 1996
-------------------------
SMALL CAP FUND
GROWTH FUND-BALANCED FUND
-------------------------
<TABLE>
<CAPTION>
BALANCED - FUND
================================================================================
INVESTMENT INCOME
- --------------------------------------------------------------------------------
<S> <C>
Net investment income from Portfolio $ 161,042
================================================================================
Expenses:
- --------------------------------------------------------------------------------
Administration fees (Note 3) 39,822
Trustees' fees 12,499
Auditing fee 11,001
Legal fee 673
Transfer agent's fee 12,202
Custody and accounting services fee 6,000
Report to shareholders 4,001
Registration fees 9,000
Amortization of organization costs 9,999
Miscellaneous 9,138
- --------------------------------------------------------------------------------
Total expenses 114,335
Less, reimbursement/waiver by Provident
Investment Counsel, Inc. (Note 3) (83,307)
- --------------------------------------------------------------------------------
Net expenses 31,028
================================================================================
Net investment income 130,014
- --------------------------------------------------------------------------------
================================================================================
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS
- --------------------------------------------------------------------------------
Net realized gain on investments 955,355
Change in net unrealized appreciation
on investments 375,579
- --------------------------------------------------------------------------------
Net gain on investments 1,330,934
================================================================================
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $ 1,460,948
- --------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
10
<PAGE> 11
[PIC LOGO] P-I-C STATEMENT OF CHANGES IN NET ASSETS
INSTITUTIONAL
-------------------------
SMALL CAP FUND
GROWTH FUND-BALANCED FUND
-------------------------
<TABLE>
<CAPTION>
BALANCED - FUND
=====================================================================================
INCREASE IN NET ASSETS
- -------------------------------------------------------------------------------------
<S> <C> <C>
Year Year
ended ended
From operations: October 31, 1996 October 31, 1995
- -------------------------------------------------------------------------------------
Net investment income $ 130,014 $ 169,929
Net realized gain on investments 955,355 1,041,048
Change in net unrealized appreciation
on investments 375,579 1,491,368
Net increase in net assets resulting
from operations 1,460,948 2,702,345
=====================================================================================
Dividends:
From net investment income (130,077) (168,227)
From net realized gains (595,121) (0)
- -------------------------------------------------------------------------------------
Total dividends (725,198) (168,227)
=====================================================================================
Transactions in shares of beneficial interest:
Purchases of 66,463 and 674,528
shares, respectively 853,581 7,543,312
Value of 58,018 and 13,617 shares
issued in payment of dividends,
respectively 717,579 160,830
Redemptions of 147,233 and 554,383
shares, respectively (1,983,749) (6,843,102)
- -------------------------------------------------------------------------------------
Net increase in net assets resulting
from share transactions (412,589) 861,040
=====================================================================================
Total increase in net assets 323,161 3,395,158
=====================================================================================
NET ASSETS:
- -------------------------------------------------------------------------------------
Beginning of year 12,545,043 9,149,885
- -------------------------------------------------------------------------------------
End of year $ 12,868,204 $ 12,545,043
- -------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
11
<PAGE> 12
[PIC LOGO] P-I-C FINANCIAL HIGHLIGHTS
INSTITUTIONAL
-------------------------
SMALL CAP FUND
GROWTH FUND-BALANCED FUND
-------------------------
<TABLE>
<CAPTION>
BALANCED - FUND
==============================================================================================================
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
- --------------------------------------------------------------------------------------------------------------
Year Year Year Year June 11, 1992*
ended ended ended ended through
Oct. 31, 1996 Oct. 31, 1995 Oct. 31, 1994 Oct. 31, 1993 Oct. 31, 1992
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning
of period $ 13.24 $ 11.24 $ 11.48 $ 10.82 $ 10.00
Income from investment operations:
Net investment income .14 .15 .15 .18 .04
Net realized and unrealized
gain (loss) on investments 1.34 2.00 (.24) .69 .78
- --------------------------------------------------------------------------------------------------------------
Total from investment operations 1.48 2.15 (.09) .87 .82
- --------------------------------------------------------------------------------------------------------------
Less:
Dividends from net investment
income (.14) (.15) (.15) (.21) .00
Dividends from net realized
gains (.67) .00 .00 .00 .00
- --------------------------------------------------------------------------------------------------------------
Total dividends (.81) (.15) (.15) (.21) .00
- --------------------------------------------------------------------------------------------------------------
Change in net asset value .67 2.00 (.24) .66 .82
- --------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 13.91 $ 13.24 $ 11.24 $ 11.48 $ 10.82
==============================================================================================================
Total return 11.96% 19.35% (.78%) 8.10% 21.14%++
==============================================================================================================
Ratios/supplemental data:
Net assets, end of period (millions) $ 12.9 $ 12.5 $ 9.1 $ 6.7 $ 1.2
- --------------------------------------------------------------------------------------------------------------
Ratios to average net assets:+**
Expenses 1.05% 1.05% 1.05% 1.05% 1.05%++
Net investment income 1.05% 1.32% 1.37% 1.79% 2.60%++
- --------------------------------------------------------------------------------------------------------------
</TABLE>
*Commencement of operations.
+Net of expense reimbursements.
**Includes the Fund's share of expenses, net of fee waivers and expense
reimbursements, allocated from P-I-C Balanced Portfolio. If the fee waivers and
expense reimbursements, with respect to the Fund and PUIUC Balanced Portfolio,
had not been made, the ratio of expenses to average net assets would have been
1.72%, 2.32%, 2.87%, 7.44% and 43.11%, respectively.
++Annualized.
See Notes to Financial Statements.
12
<PAGE> 13
P-I-C STATEMENT OF NET ASSETS
BALANCED as of October 31, 1996
PORTFOLIO
<TABLE>
<CAPTION>
===================================================================================
Percentage of
EQUITY SECURITIES - 72.1% Shares Value Net Assets
- -----------------------------------------------------------------------------------
<S> <C> <C> <C>
APPAREL AND SHOES - 0.9%
Nike, Inc. 2,000 $117,750 0.9%
===================================================================================
BIOTECHNOLOGY - 1.4%
- -----------------------------------------------------------------------------------
Amgen, Inc.* 3,000 183,937 1.4%
===================================================================================
BUSINESS SERVICES - 1.4%
- -----------------------------------------------------------------------------------
Accustaff, Inc.* 2,100 56,175 0.4%
Alco Standard Corp. 700 32,463 0.3%
Danka Business System, Plc,
Sponsored ADR 2,300 91,137 0.7%
Total Business Services 179,775
===================================================================================
BUILDING PRODUCTS - 0.4%
- -----------------------------------------------------------------------------------
Home Depot, Inc. 900 49,275 0.4%
===================================================================================
BUSINESS INFORMATION SERVICES - 2.0%
- -----------------------------------------------------------------------------------
Automatic Data Processing, Inc. 1,000 41,625 0.3%
Ceridian Corp.* 1,800 89,325 0.7%
Paychex, Inc. 2,150 122,550 1.0%
Total Business Information Services 253,500
===================================================================================
CHEMICALS - 0.8%
- -----------------------------------------------------------------------------------
Monsanto Company 2,700 106,987 0.8%
===================================================================================
COMPUTER SERVICES - 2.5%
- -----------------------------------------------------------------------------------
Computer Sciences Corp.* 2,000 148,500 1.1%
Electronic Data Systems Corp. 1,700 76,500 0.6%
Shared Medical Systems Corp. 500 24,125 0.2%
Sungard Data Systems, Inc.* 1,800 76,950 0.6%
- -----------------------------------------------------------------------------------
Total Computer Services 326,075
</TABLE>
13
<PAGE> 14
P-I-C STATEMENT OF NET ASSETS
BALANCED as of October 31, 1996
PORTFOLIO
<TABLE>
<CAPTION>
================================================================================
Percentage of
EQUITY SECURITIES - CONTINUED Shares Value Net Assets
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
COMPUTER SOFTWARE - 7.2%
- --------------------------------------------------------------------------------
Computer Associates International, Inc. 4,375 $258,672 2.0%
Microsoft Corp.* 3,434 471,317 3.7%
Oracle Systems Corp.* 4,750 200,984 1.5%
- --------------------------------------------------------------------------------
Total Computer Software 930,973
================================================================================
CONSTRUCTION - 0.3%
- --------------------------------------------------------------------------------
Flour Corp. 600 39,300 0.3%
================================================================================
COSMETICS AND SOAP - 1.9%
- --------------------------------------------------------------------------------
Estee Lauder Companies, Class A 500 21,500 0.2%
The Gillette Company 2,900 216,775 1.7%
- --------------------------------------------------------------------------------
Total Cosmetics and Soap 238,275
================================================================================
CREDIT AND FINANCE - 3.9%
- --------------------------------------------------------------------------------
Associate First Capital Corp. 2,100 91,087 0.7%
First USA, Inc. 2,300 132,250 1.0%
MBNA Corp. 7,310 275,953 2.2%
- --------------------------------------------------------------------------------
Total Credit and Finance 499,290
================================================================================
DISCOUNT STORES - 0.7%
- --------------------------------------------------------------------------------
Price Costco, Inc.* 4,600 91,425 0.7%
================================================================================
DIVERSIFIED - 2.0%
- --------------------------------------------------------------------------------
American Standard Company, Inc.* 600 22,575 0.2%
Thermo Electron Corp.* 2,800 102,200 0.8%
Tyco International Ltd. 2,600 129,025 1.0%
- --------------------------------------------------------------------------------
Total Diversified 253,800
</TABLE>
14
<PAGE> 15
P-I-C STATEMENT OF NET ASSETS
BALANCED as of October 31, 1996
PORTFOLIO
<TABLE>
<CAPTION>
================================================================================
Percentage of
EQUITY SECURITIES - CONTINUED Shares Value Net Assets
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
DRUGS - 6.4%
- --------------------------------------------------------------------------------
Elan Corp. PLC, ADR* 2,800 $ 77,700 0.6%
Eli Lilly & Company 1,900 133,950 1.0%
Merck & Co., Inc. 2,400 177,900 1.4%
Pfizer, Inc. 5,200 430,300 3.4%
- --------------------------------------------------------------------------------
Total Drugs 819,850
================================================================================
ELECTRIC COMPONENTS/SEMICONDUCTORS - 0.6%
- --------------------------------------------------------------------------------
Analog Devices, Inc.* 2,850 74,100 0.6%
================================================================================
ENERGY - 0.2%
- --------------------------------------------------------------------------------
AES Corp.* 700 30,712 0.2%
================================================================================
ENTERTAINMENT - 5.5%
- --------------------------------------------------------------------------------
Asia Satellite Telecommunication,
Sponsored ADR* 500 13,375 0.1%
British Sky Broadcasting Group Plc,
Sponsored ADR 3,400 190,825 1.5%
Hospitality Franchise System, Inc.* 4,900 358,925 2.8%
Walt Disney Company 2,254 148,482 1.1%
- --------------------------------------------------------------------------------
Total Entertainment 711,607
================================================================================
FINANCIAL SERVICES - 3.0%
- --------------------------------------------------------------------------------
First Data Corp. 4,866 388,064 3.0%
================================================================================
FUNERAL SERVICES - 0.7%
- --------------------------------------------------------------------------------
Service Corp. International 3,000 85,500 0.7%
================================================================================
GAMING - 1.5%
- --------------------------------------------------------------------------------
Circus Circus Enterprise, Inc.* 1,900 65,550 0.5%
Mirage Resorts, Inc.* 6,000 132,000 1.0%
- --------------------------------------------------------------------------------
Total Gaming 197,550
</TABLE>
15
<PAGE> 16
P-I-C STATEMENT OF NET ASSETS
BALANCED as of October 31, 1996
PORTFOLIO
<TABLE>
<CAPTION>
================================================================================
Percentage of
EQUITY SECURITIES - CONTINUED Shares Value Net Assets
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
HEALTH INDUSTRY SERVICES - 1.1%
- --------------------------------------------------------------------------------
Healthsouth Corp.* 3,900 $146,250 1.1%
================================================================================
HEALTH MAINTENANCE ORGANIZATIONS - 1.4%
- --------------------------------------------------------------------------------
Oxford Health Plans, Inc.* 4,000 182,000 1.4%
- --------------------------------------------------------------------------------
HOSPITALS - 0.5%
- --------------------------------------------------------------------------------
Columbia/HCA Healthcare 1,650 58,987 0.5%
================================================================================
INSURANCE - 2.2%
- --------------------------------------------------------------------------------
American International Group, Inc. 1,500 162,937 1.3%
MGIC Investment Corp. 1,700 116,662 0.9%
- --------------------------------------------------------------------------------
Total Insurance 279,599
================================================================================
MEDICAL INSTRUMENTS - 3.0%
- --------------------------------------------------------------------------------
Boston Scientific Corp.* 2,100 114,187 0.9%
Medtronic, Inc. 4,300 276,813 2.1%
- --------------------------------------------------------------------------------
Total Medical Instruments 391,000
================================================================================
MEDICAL SERVICES - 1.0%
- --------------------------------------------------------------------------------
Cardinal Health, Inc. 1,700 133,450 1.0%
================================================================================
MORTGAGE AND RELATED SERVICES - 4.2%
- --------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp. 1,200 121,200 1.0%
Federal National Mortgage
Association 10,560 413,160 3.2%
- --------------------------------------------------------------------------------
Total Mortgage and Related Services 534,360
================================================================================
NATURAL GAS PRODUCTS AND PIPELINES - 0.6%
- --------------------------------------------------------------------------------
Enron Corp. 1,640 76,260 0.6%
</TABLE>
16
<PAGE> 17
P-I-C STATEMENT OF NET ASSETS
BALANCED as of October 31, 1996
PORTFOLIO
<TABLE>
<CAPTION>
================================================================================
Percentage of
EQUITY SECURITIES - CONTINUED Shares Value Net Assets
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
NETWORKING - 1.9%
- --------------------------------------------------------------------------------
Cisco Systems* 3,900 $241,313 1.9%
================================================================================
OFFICE EQUIPMENT/SUPPLIES - 0.8%
- --------------------------------------------------------------------------------
Staples, Inc.* 5,800 108,025 0.8%
================================================================================
OIL & GAS PRODUCTION - 0.4%
- --------------------------------------------------------------------------------
Tosco Corp. 1,000 56,125 0.4%
================================================================================
OIL FIELD SERVICES - 0.8%
- --------------------------------------------------------------------------------
Schlumberger Ltd. 1,000 99,125 0.8%
================================================================================
POLLUTION CONTROL - 0.8%
- --------------------------------------------------------------------------------
Republic Industries, Inc.* 3,500 108,938 0.8%
================================================================================
SPECIALTY CHAINS - 1.9%
- --------------------------------------------------------------------------------
CUC International, Inc.* 5,100 124,950 1.0%
Kohls Corp.* 2,300 82,800 0.6%
Walgreen Co. 1,000 37,750 0.3%
- --------------------------------------------------------------------------------
Total Specialty Chains 245,500
================================================================================
SUPERMARKETS - 0.8%
- --------------------------------------------------------------------------------
Safeway, Inc.* 2,300 98,613 0.8%
================================================================================
TELEPHONE COMMUNICATIONS - 4.8%
- --------------------------------------------------------------------------------
ADC Telecommunications, Inc.* 1,200 82,050 0.6%
Andrew Corp.* 1,350 65,813 0.5%
L.M. Ericsson Telephone Co., ADR 10,900 301,113 2.4%
Lucent Technologies, Inc. 3,500 164,500 1.3%
- --------------------------------------------------------------------------------
Total Telephone Communications 613,476
</TABLE>
17
<PAGE> 18
P-I-C STATEMENT OF NET ASSETS
BALANCED as of October 31, 1996
PORTFOLIO
<TABLE>
<CAPTION>
================================================================================
Percentage of
EQUITY SECURITIES - CONTINUED Shares Value Net Assets
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
TELEPHONE - 1.5%
- --------------------------------------------------------------------------------
Frontier Corp. 2,900 $ 84,100 0.7%
Worldcom, Inc.* 4,400 107,250 0.8%
- --------------------------------------------------------------------------------
Total Telephone 191,350
================================================================================
TEXTILES AND SHOES - 1.1%
- --------------------------------------------------------------------------------
Gucci Group N.V. 600 41,400 0.3%
Tommy Hilfiger Corp.* 1,900 98,800 0.8%
- --------------------------------------------------------------------------------
Total Textiles and Shoes 140,200
- --------------------------------------------------------------------------------
Total Equity Securities (Cost $6,770,592) 9,282,316 72.1%
================================================================================
FIXED INCOME SECURITIES - 24.0%
- --------------------------------------------------------------------------------
CORPORATE BONDS - 5.6%
- --------------------------------------------------------------------------------
Ford Motor Credit Corp.,
7.250%, 5/15/1999 $ 175,000 179,375 1.4%
Hertz Corp., 6.000%, 1/15/2003 200,000 193,500 1.5%
Household Bank, 6.500%, 7/15/2003 175,000 173,906 1.3%
International Lease Finance,
6.125%, 11/1/1999 175,000 174,344 1.4%
- --------------------------------------------------------------------------------
Total Corporate Bonds (Cost $732,083) 721,125 5.6%
================================================================================
U.S. TREASURY OBLIGATIONS - 18.4%
- --------------------------------------------------------------------------------
U.S. Treasury Bond,
10.375%, 11/15/2012 500,000 648,610 5.0%
U.S. Treasury Bond,
9.875%, 11/15/2015 275,000 368,868 2.9%
U.S. Treasury Note,
5.625%, 1/31/1998 150,000 150,048 1.2%
U.S. Treasury Note,
6.875%, 7/31/1999 525,000 537,883 4.2%
</TABLE>
18
<PAGE> 19
P-I-C STATEMENT OF NET ASSETS
BALANCED as of October 31, 1996
PORTFOLIO
<TABLE>
<CAPTION>
================================================================================
Percentage of
EQUITY SECURITIES - CONTINUED Shares Value Net Assets
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. TREASURY OBLIGATIONS, CONTINUED
- --------------------------------------------------------------------------------
U.S. Treasury Note,
7.750%, 1/31/2000 $ 200,000 $ 210,528 1.6%
U.S. Treasury Note,
6.250%, 2/15/2003 450,000 452,030 3.5%
- --------------------------------------------------------------------------------
Total U.S. Treasury Obligations
(Cost $2,360,183) 2,367,967 18.4%
- --------------------------------------------------------------------------------
Total Investments (Cost $9,862,858) 12,371,408 96.1%
================================================================================
OTHER ASSETS - 4.1%
- --------------------------------------------------------------------------------
Cash 422,994
Receivables:
Dividends and interest 81,772
Investment securities sold 9,508
Shares of beneficial interest sold 584
Investment advisor 8,111
Deferred organization costs 4,538
Other assets 1,207
- --------------------------------------------------------------------------------
Total Other Assets 528,714 4.1%
================================================================================
LIABILITIES - (0.2%)
- --------------------------------------------------------------------------------
Shares of beneficial interest redeemed 2,017
Deferred Trustees' compensation (Note 3) 1,714
Accrued expenses 27,932
- --------------------------------------------------------------------------------
Total Liabilities 31,663 (0.2%)
================================================================================
TOTAL NET ASSETS - 100.0% $12,868,459 100.0%
- --------------------------------------------------------------------------------
</TABLE>
*Non-income producing security.
See Notes to Financial Statements.
19
<PAGE> 20
P-I-C STATEMENT OF OPERATIONS
BALANCED Year ended October 31, 1996
PORTFOLIO
<TABLE>
<S> <C>
- --------------------------------------------------------------------------------
INVESTMENT INCOME
- --------------------------------------------------------------------------------
Income:
- --------------------------------------------------------------------------------
Dividends $ 51,991
Interest 208,336
- --------------------------------------------------------------------------------
Total income 260,327
- --------------------------------------------------------------------------------
Expenses:
- --------------------------------------------------------------------------------
Investment advisory fee (Note 3) 74,462
Administration fee 12,410
Accounting services fee 67,300
Custodian fee 23,945
Auditing fee 16,001
Trustees' fees 3,799
Amortization of organization costs 9,999
Miscellaneous 2,946
- --------------------------------------------------------------------------------
Total expenses 210,862
Less, reimbursement/waiver by Advisor (Note 3) (111,580)
- --------------------------------------------------------------------------------
Net expenses 99,282
- --------------------------------------------------------------------------------
Net investment income 161,045
- --------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS
- --------------------------------------------------------------------------------
Net realized gain from security transactions 955,369
Change in net unrealized appreciation on
investments 375,580
- --------------------------------------------------------------------------------
Net gain on investments 1,330,949
- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $ 1,491,994
- --------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
20
<PAGE> 21
P-I-C
BALANCED STATEMENT OF CHANGES IN NET ASSETS
PORTFOLIO
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------
INCREASE IN NET ASSETS:
- ------------------------------------------------------------------------------------
<S> <C> <C>
Year Year
ended ended
From operations: October 31, 1996 October 31, 1995
- ------------------------------------------------------------------------------------
Net investment income $ 161,045 $ 202,082
Net realized gain on investments 955,369 1,041,070
Change in net unrealized appreciation
on investments 375,580 1,491,367
- ------------------------------------------------------------------------------------
Net increase in net assets resulting
from operations 1,491,994 2,734,519
- ------------------------------------------------------------------------------------
Transactions in interests:
Contributions by Holders 904,221 7,579,804
Withdrawals by Holders (2,068,351) (6,913,353)
- ------------------------------------------------------------------------------------
Net (decrease) increase in net assets
from transactions in interests (1,164,130) 666,451
- ------------------------------------------------------------------------------------
Total increase in net assets 327,864 3,400,970
- ------------------------------------------------------------------------------------
NET ASSETS:
- ------------------------------------------------------------------------------------
Beginning of year 12,540,595 9,139,625
- ------------------------------------------------------------------------------------
End of year $12,868,459 $ 12,540,595
- ------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
21
<PAGE> 22
[PIC Logo]
P-I-C
BALANCED SELECTED RATIO DATA
PORTFOLIO
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Year Year Year
ended ended ended ended
Oct. 31, 1996 Oct. 31, 1995 Oct. 31, 1994 Oct. 31, 1993
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Ratios to average net assets:++
Operating expenses 0.80% 0.80% 0.80% 0.80%
Net investment income 1.30% 1.57% 1.63% 2.05%
Portfolio turnover rate 54.24% 106.50% 116.63% 92.65%
Average commisson rate paid* $0.0406 - - -
</TABLE>
*For fiscal years beginning on or after September 1, 1995, a fund is required to
disclose its average commission rate per share for security trades on which
commissions are charged.
++Net of expense reimbursements equivalent to 0.90%, 0.78%, 1.16% and 4.68% of
average net assets, respectively.
22
<PAGE> 23
[PIC Logo]
P-I-C
INSTITUTIONAL STATEMENT OF ASSETS AND LIABILITIES
as of October 31, 1996
GROWTH FUND
- --------------------------------------------------------------------------------
ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Investment in P-I-C Growth Portfolio, at value $116,099,369
Receivables:
Fund shares sold 21,803
For investments sold in P-I-C
Growth Portfolio 32,348
Prepaid registration fees 14,982
Deferred organization costs 4,538
- --------------------------------------------------------------------------------
Total assets 116,173,040
- --------------------------------------------------------------------------------
LIABILITIES
- --------------------------------------------------------------------------------
Payables:
Fund shares redeemed 32,348
For investments purchased in P-I-C
Growth Portfolio 21,803
Deferred Trustees' compensation (Note 3) 5,405
Accrued expenses 28,604
- --------------------------------------------------------------------------------
Total liabilities 88,160
- --------------------------------------------------------------------------------
NET ASSETS
- --------------------------------------------------------------------------------
Applicable to 7,143,673 shares of beneficial interest
outstanding $116,084,880
- --------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE $ 16.25
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SOURCE OF NET ASSETS
- --------------------------------------------------------------------------------
Paid-in capital $ 72,728,741
Accumulated net realized gain on investments 15,972,035
Accumulated net investment loss (688,843)
Net unrealized appreciation on investments 28,072,947
- --------------------------------------------------------------------------------
Net assets $116,084,880
- --------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
23
<PAGE> 24
[PIC Logo]
P-I-C
INSTITUTIONAL STATEMENT OF OPERATIONS
Year ended October 31, 1996
GROWTH FUND
- --------------------------------------------------------------------------------
INVESTMENT INCOME
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Net investment loss from Portfolio $ (34,806)
- --------------------------------------------------------------------------------
Expenses:
- --------------------------------------------------------------------------------
Administration fees (Note 3) 251,785
Trustees' fees 12,669
Auditing fee 14,501
Legal fee 5,551
Transfer agent's fee 27,999
Custody and accounting services fee 6,000
Reports to shareholders 4,999
Registration fees 10,002
Amortization of organization costs 9,999
Miscellaneous 7,512
- --------------------------------------------------------------------------------
Total expenses 351,017
Less, reimbursement/waiver by Provident
Investment Counsel, Inc. (Note 3) (55,034)
- --------------------------------------------------------------------------------
Net expenses 295,983
- --------------------------------------------------------------------------------
Net investment loss (330,789)
- --------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS
- --------------------------------------------------------------------------------
Net realized gain on investments 17,650,636
Change in net unrealized depreciation on investments (1,600,474)
- --------------------------------------------------------------------------------
Net gain on investments 16,050,162
- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $15,719,373
- --------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
24
<PAGE> 25
[PIC Logo]
P-I-C
INSTITUTIONAL STATEMENT OF CHANGES IN NET ASSETS
GROWTH FUND
- --------------------------------------------------------------------------------
INCREASE (DECREASE) IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Year
ended ended
From operations: October 31, 1996 October 31, 1995
- ----------------------------------------------------------------------------------
<S> <C> <C>
Net investment loss $ (330,789) $ (189,686)
Net realized gain on investments 17,650,636 715,922
Change in net unrealized (depreciation)
appreciation on investments (1,600,474) 22,079,471
- ----------------------------------------------------------------------------------
Net increase in net assets resulting
from operations 15,719,373 22,605,707
- ----------------------------------------------------------------------------------
Transactions in shares of beneficial interest:
Purchases of 1,170,731 and 2,058,233
shares, respectively 17,592,972 25,480,815
Redemptions of 3,232,079 and 1,593,166
shares, respectively (48,366,887) (19,229,741)
- ----------------------------------------------------------------------------------
Net (decrease) increase in net assets
resulting from share transactions (30,773,915) 6,251,074
- ----------------------------------------------------------------------------------
Total increase (decrease) in net assets (15,054,542) 28,856,781
- ----------------------------------------------------------------------------------
NET ASSETS:
- ----------------------------------------------------------------------------------
Beginning of year 131,139,422 102,282,641
- ----------------------------------------------------------------------------------
End of year $116,084,880 $131,139,422
- ----------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
25
<PAGE> 26
[PIC Logo]
P-I-C
INSTITUTIONAL FINANCIAL HIGHLIGHTS
GROWTH FUND
- --------------------------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Year Year Year June 11, 1992*
ended ended ended ended through
Oct. 31, 1996 Oct. 31, 1995 Oct. 31,1994 Oct. 31, 1993 Oct. 31, 1992
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 14.25 $ 11.70 $ 11.60 $ 10.81 $ 10.00
- -----------------------------------------------------------------------------------------------------------------
Income from investment operations:
Net investment (loss) income (.06) (.02) .00 .00 .01
Net realized and unrealized
gain on investments 2.06 2.57 .10 .80 .80
- -----------------------------------------------------------------------------------------------------------------
Total from investment operations 2.00 2.55 .10 .80 .81
- -----------------------------------------------------------------------------------------------------------------
Less distributions:
Return of capital .00 .00 .00 (.01) .00
- -----------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 16.25 $ 14.25 $ 11.70 $ 11.60 $ 10.81
- -----------------------------------------------------------------------------------------------------------------
Total return 14.04% 21.79% 0.86% 7.40% 20.88%++
- -----------------------------------------------------------------------------------------------------------------
Ratios/supplemental data:
Net assets, end of period (millions) $116.1 $131.1 $102.3 $ 88.9 $ 5.7
- -----------------------------------------------------------------------------------------------------------------
Ratios to average net assets:**+
Expenses 1.25% 1.25% 1.25% 1.25% 1.25%++
Net investment (loss) income (.28%) (.17%) N/A N/A .25%++
- -----------------------------------------------------------------------------------------------------------------
</TABLE>
*Commencement of operations.
**Includes the Fund's share of expenses, net of expense reimbursements,
allocated from P-I-C Growth Portfolio. If the fee waivers and expense
reimbursements, with respect to the Fund and P-I-C Growth Portfolio, had not
been made, the ratio of expenses to average net assets would have been 1.30%,
1.30%, 1.53%, 1.54% and 4.12%, respectively.
+Net of expense reimbursements.
++Annualized.
See Notes to Financial Statements.
26
<PAGE> 27
[PIC Logo]
P-I-C
GROWTH STATEMENT OF NET ASSETS
PORTFOLIO as of October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Percentage of
EQUITY SECURITIES - 95.7% Shares Value Net Assets
- --------------------------------------------------------------------------------------
<S> <C> <C> <C>
APPAREL & SHOE - 1.4%
- --------------------------------------------------------------------------------------
Nike, Inc. 27,400 $ 1,613,175 1.4%
- --------------------------------------------------------------------------------------
BANKS - 0.1%
- --------------------------------------------------------------------------------------
Synovus Financial Corporation 5,723 170,975 0.1%
- --------------------------------------------------------------------------------------
BIOTECHNOLOGY - 1.9%
- --------------------------------------------------------------------------------------
Amgen, Inc.* 35,334 2,166,416 1.9%
- --------------------------------------------------------------------------------------
BUILDING PRODUCTS - 0.5%
- --------------------------------------------------------------------------------------
Home Depot, Inc. 10,292 563,487 0.5%
- --------------------------------------------------------------------------------------
BUSINESS INFORMATION SERVICE - 2.6%
- --------------------------------------------------------------------------------------
Automatic Data Processing, Inc. 12,223 508,782 0.5%
Ceridian Corp.* 21,090 1,046,591 0.9%
Paychex, Inc. 25,168 1,434,576 1.2%
- --------------------------------------------------------------------------------------
Total Business Information Service 2,989,949
- --------------------------------------------------------------------------------------
BUSINESS AND FINANCIAL SERVICES - 1.8%
- --------------------------------------------------------------------------------------
Accustaff, Inc.* 25,502 682,178 0.6%
Alco Standard Corporation 7,408 343,546 0.3%
Danka Business Systems PLC, ADR 25,279 1,001,680 0.9%
- --------------------------------------------------------------------------------------
Business and Financial Services 2,027,404
- --------------------------------------------------------------------------------------
CHEMICALS - 1.1%
- --------------------------------------------------------------------------------------
Monsanto Company 30,811 1,220,886 1.1%
- --------------------------------------------------------------------------------------
COMPUTER SERVICES - 3.3%
- --------------------------------------------------------------------------------------
Computer Sciences Corp.* 24,008 1,782,594 1.6%
Electronic Data Systems Corp. 20,614 927,630 0.8%
</TABLE>
27
<PAGE> 28
[PIC Logo]
P-I-C
GROWTH STATEMENT OF NET ASSETS
PORTFOLIO as of October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Percentage of
EQUITY SECURITIES, CONTINUED Shares Value Net Assets
- --------------------------------------------------------------------------------------
<S> <C> <C> <C>
COMPUTER SERVICES, CONTINUED
- --------------------------------------------------------------------------------------
Shared Medical Systems Corp. 5,553 $ 267,932 0.2%
Sungard Data Systems, Inc.* 20,100 859,275 0.7%
- --------------------------------------------------------------------------------------
Total Computer Services 3,837,431
- --------------------------------------------------------------------------------------
COMPUTER SOFTWARE - 9.8%
- --------------------------------------------------------------------------------------
Computer Associates International, Inc. 53,437 3,159,463 2.7%
Microsoft Corp.* 40,978 5,624,231 4.9%
Oracle Systems Corp.* 61,354 2,596,041 2.2%
- --------------------------------------------------------------------------------------
Total Computer Software 11,379,735
- --------------------------------------------------------------------------------------
CONSTRUCTION - 0.4%
- --------------------------------------------------------------------------------------
Flour Corp. 7,300 478,150 0.4%
- --------------------------------------------------------------------------------------
COSMETICS - 2.4%
- --------------------------------------------------------------------------------------
Estee Lauder Companies, Class A 5,728 246,304 0.2%
The Gillette Company 34,109 2,549,648 2.2%
- --------------------------------------------------------------------------------------
Total Cosmetics 2,795,952
- --------------------------------------------------------------------------------------
CREDIT AND FINANCE - 5.5%
- --------------------------------------------------------------------------------------
Associates First Capital Corp. 33,080 1,434,845 1.2%
First USA Inc. 27,486 1,580,445 1.4%
MBNA Corporation 89,295 3,370,886 2.9%
- --------------------------------------------------------------------------------------
Total Credit and Finance 6,386,176
- --------------------------------------------------------------------------------------
DISCOUNT - 0.9%
- --------------------------------------------------------------------------------------
Price/Costco, Inc.* 52,000 1,033,500 0.9%
</TABLE>
28
<PAGE> 29
[PIC Logo]
P-I-C
GROWTH STATEMENT OF NET ASSETS
PORTFOLIO as of October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Percentage of
EQUITY SECURITIES, CONTINUED Shares Value Net Assets
- --------------------------------------------------------------------------------------
<S> <C> <C> <C>
DIVERSIFIED - 2.3%
- --------------------------------------------------------------------------------------
Thermo Electron Corp.* 32,153 $ 1,173,585 1.0%
Tyco International Ltd. 31,205 1,548,548 1.3%
- --------------------------------------------------------------------------------------
Total Diversified 2,722,133
- --------------------------------------------------------------------------------------
DRUGS - 8.6%
- --------------------------------------------------------------------------------------
Elan Corp., PLC, ADR* 31,732 880,563 0.8%
Eli Lilly & Company 24,210 1,706,805 1.5%
Merck & Company, Inc. 29,164 2,161,782 1.8%
Pfizer, Inc. 63,042 5,216,726 4.5%
- --------------------------------------------------------------------------------------
Total Drugs 9,965,876
- --------------------------------------------------------------------------------------
ELECTRONIC COMPONENTS/SEMICONDUCTORS - 0.7%
- --------------------------------------------------------------------------------------
Analog Devices, Inc.* 32,997 857,922 0.7%
- --------------------------------------------------------------------------------------
ENERGY - 0.3%
- --------------------------------------------------------------------------------------
AES Corp.* 7,400 324,675 0.3%
- --------------------------------------------------------------------------------------
ENTERTAINMENT - 7.3%
- --------------------------------------------------------------------------------------
Asia Satellite Telecommunications,
Sponsored ADR* 6,200 165,850 0.1%
British Sky Broadcasting Group 39,274 2,204,253 1.9%
Hospitality Franchise System, Inc.* 59,797 4,380,130 3.8%
Walt Disney Company 26,990 1,777,966 1.5%
- --------------------------------------------------------------------------------------
Total Entertainment 8,528,199
- --------------------------------------------------------------------------------------
FINANCIAL SERVICES - 4.1%
- --------------------------------------------------------------------------------------
First Data Corp. 59,922 4,778,779 4.1%
- --------------------------------------------------------------------------------------
FUNERAL SERVICES - 0.9%
- --------------------------------------------------------------------------------------
Service Corp. International 37,518 1,069,263 0.9%
</TABLE>
29
<PAGE> 30
[PIC Logo]
P-I-C
GROWTH STATEMENT OF NET ASSETS
PORTFOLIO as of October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Percentage of
EQUITY SECURITIES, CONTINUED Shares Value Net Assets
- --------------------------------------------------------------------------------------
<S> <C> <C> <C>
GAMING - 2.0%
- --------------------------------------------------------------------------------------
Circus Circus Enterprises, Inc.* 22,620 $ 780,390 0.7%
Mirage Resorts, Inc.* 72,524 1,595,528 1.3%
- --------------------------------------------------------------------------------------
Total Gaming 2,375,918
- --------------------------------------------------------------------------------------
HEALTH MAINTENANCE ORGANIZATIONS - 1.9%
- --------------------------------------------------------------------------------------
Oxford Health Plans, Inc.* 48,667 2,214,349 1.9%
- --------------------------------------------------------------------------------------
HOSPITALS - 0.6%
- --------------------------------------------------------------------------------------
Columbia/HCA Healthcare 18,991 678,928 0.6%
- --------------------------------------------------------------------------------------
INSURANCE - 2.9%
- --------------------------------------------------------------------------------------
American International Group, Inc. 18,012 1,956,553 1.7%
MGIC Investment Corp. 19,844 1,361,795 1.2%
- --------------------------------------------------------------------------------------
Total Insurance 3,318,348
- --------------------------------------------------------------------------------------
MEDICAL INSTRUMENTS - 4.0%
- --------------------------------------------------------------------------------------
Boston Scientific Corp.* 23,896 1,299,345 1.1%
Medtronic, Inc. 52,477 3,378,207 2.9%
- --------------------------------------------------------------------------------------
Total Medical Instruments 4,677,552
- --------------------------------------------------------------------------------------
MEDICAL/DENTAL SERVICES - 1.3%
- --------------------------------------------------------------------------------------
Cardinal Health, Inc. 19,811 1,555,163 1.3%
- --------------------------------------------------------------------------------------
MORTGAGE AND RELATED SERVICES - 5.6%
- --------------------------------------------------------------------------------------
Federal Home Loan Mortgage
Association 14,229 1,437,129 1.2%
Federal National Mortgage
Association 129,319 5,059,606 4.4%
- --------------------------------------------------------------------------------------
Total Mortgage and Related
Services 6,496,735
</TABLE>
30
<PAGE> 31
[PIC Logo]
P-I-C
GROWTH STATEMENT OF NET ASSETS
PORTFOLIO as of October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Percentage of
EQUITY SECURITIES, CONTINUED Shares Value Net Assets
- --------------------------------------------------------------------------------------
<S> <C> <C> <C>
NATURAL GAS PRODUCTS AND PIPELINES - 0.7%
- --------------------------------------------------------------------------------------
Enron Corp. 18,356 $ 853,554 0.7%
- --------------------------------------------------------------------------------------
NETWORKING - 2.5%
- --------------------------------------------------------------------------------------
Cisco Systems* 46,860 2,899,462 2.5%
- --------------------------------------------------------------------------------------
OIL FIELD SERVICES - 1.1%
- --------------------------------------------------------------------------------------
Schlumberger Ltd. 12,500 1,239,063 1.1%
- --------------------------------------------------------------------------------------
OIL REFINING/MARKETING - 0.6%
- --------------------------------------------------------------------------------------
Tosco Corp. 12,100 679,113 0.6%
- --------------------------------------------------------------------------------------
OFFICE EQUIPMENT & SUPPLIES - 1.1%
- --------------------------------------------------------------------------------------
Staples, Inc.* 70,332 1,309,934 1.1%
- --------------------------------------------------------------------------------------
OUTPATIENT - HOME CARE - 1.5%
- --------------------------------------------------------------------------------------
Healthsouth Corp.* 46,065 1,727,437 1.5%
- --------------------------------------------------------------------------------------
POLLUTION CONTROL - 1.1%
- --------------------------------------------------------------------------------------
Republic Industries, Inc.* 39,826 1,239,584 1.1%
- --------------------------------------------------------------------------------------
SPECIALTY CHAINS - 2.5%
- --------------------------------------------------------------------------------------
CUC International, Inc.* 61,813 1,514,418 1.3%
Kohls Corp.* 26,154 941,544 0.8%
Walgreen Co. 11,500 434,125 0.4%
- --------------------------------------------------------------------------------------
Total Specialty Chains 2,890,087
- --------------------------------------------------------------------------------------
SUPERMARKETS - 1.0%
- --------------------------------------------------------------------------------------
Safeway, Inc.* 27,300 1,170,488 1.0%
</TABLE>
31
<PAGE> 32
P-I-C
-----
GROWTH STATEMENT OF NET ASSETS
------ as of October 31, 1996
PORTFOLIO
- ---------
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------
Percentage of
EQUITY SECURITIES, CONTINUED Shares Value Net Assets
- ----------------------------------------------------------------------------------
<S> <C> <C> <C>
TELECOMMUNICATIONS - 6.1%
- ----------------------------------------------------------------------------------
ADC Telecommunications, Inc.* 13,566 $ 927,575 0.8%
Andrew Corp.* 13,846 674,992 0.6%
Ericsson,(L.M.) Telephone Co., ADR 132,465 3,659,346 3.1%
Lucent Technologies, Inc. 39,500 1,856,500 1.6%
- ----------------------------------------------------------------------------------
Total Telecommunications 7,118,413
- ----------------------------------------------------------------------------------
TELEPHONE - 1.9%
- ----------------------------------------------------------------------------------
Frontier Corp. 35,186 1,020,394 0.9%
Worldcom, Inc.* 50,050 1,219,969 1.0%
- ----------------------------------------------------------------------------------
Total Telecommunications 2,240,363
- ----------------------------------------------------------------------------------
TEXTILES & SHOES - 1.4%
- ----------------------------------------------------------------------------------
Gucci Group N.V. 6,535 450,915 0.4%
Tommy Hilfiger Corp.* 21,509 1,118,468 1.0%
- ----------------------------------------------------------------------------------
Total Textiles & Shoes 1,569,383
- ----------------------------------------------------------------------------------
Total Equity Securities (Cost $83,054,588) 111,163,957 95.7%
- ----------------------------------------------------------------------------------
REPURCHASE AGREEMENT - 3.6%
- ----------------------------------------------------------------------------------
Lehman Brothers On-Line Repurchase
Agreement, 5.09%, dated 7/26/96, due
11/1/96 (Collateralized by $4,277,068
U.S. Treasury Bill, 5.09%, due 4/3/97)
(Cost $4,152,500) $4,152,500 4,152,500 3.6%
- ----------------------------------------------------------------------------------
Total Investments (Cost $87,207,088) 115,316,457 99.3%
</TABLE>
32
<PAGE> 33
P-I-C
-----
GROWTH STATEMENT OF NET ASSETS
------ as of October 31, 1996
PORTFOLIO
- ---------
<TABLE>
<CAPTION>
- --------------------------------------------------------------------
Percentage of
OTHER ASSETS - 0.8% Value Net Assets
- --------------------------------------------------------------------
<S> <C> <C>
Cash $ 64
Receivables:
Investment securities sold 826,933
Dividends and interest 71,512
Shares of beneficial interest sold 21,803
Deferred organization costs 5,010
Other assets 23,317
- --------------------------------------------------------------------
Total Assets 948,639 0.8%
- --------------------------------------------------------------------
LIABILITIES - (0.1%)
- --------------------------------------------------------------------
Investment securities purchased 32,348
Deferred Trustees' compensation (Note 3) 7,713
Accrued expenses 125,506
- --------------------------------------------------------------------
Total Liabilities 165,567 (0.1%)
- --------------------------------------------------------------------
TOTAL NET ASSETS - 100.0% $116,099,529 100.0%
- --------------------------------------------------------------------
</TABLE>
*Non-income producing security.
See Notes to Financial Statements
33
<PAGE> 34
P-I-C
-----
GROWTH STATEMENT OF NET ASSETS
------ Year ended October 31, 1996
PORTFOLIO
- ---------
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------
INVESTMENT INCOME
- ------------------------------------------------------------------------
<S> <C>
Income:
- ------------------------------------------------------------------------
Dividends $ 637,318
Interest 514,360
Other income 301
- ------------------------------------------------------------------------
Total income 1,151,979
- ------------------------------------------------------------------------
Expenses:
- ------------------------------------------------------------------------
Investment advisory fee (Note 3) 949,431
Administration fee (Note 3) 118,678
Accounting services fee 68,113
Custody fee 38,396
Auditing fees 30,597
Legal fees 5,708
Trustees' fees 16,122
Amortization of organization costs 9,415
Miscellaneous 14,726
- ------------------------------------------------------------------------
Total expenses 1,251,186
Less, reimbursement/waiver from Advisor (Note 3) (64,401)
- ------------------------------------------------------------------------
Net expenses 1,186,785
- ------------------------------------------------------------------------
Net investment loss (34,806)
- ------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS
- ------------------------------------------------------------------------
Net realized gain from security transactions 17,614,277
Change in net unrealized depreciation on investments (28,383,014)
- ------------------------------------------------------------------------
Net loss on investments (10,768,737)
- ------------------------------------------------------------------------
NET DECREASE IN NET ASSETS RESULTING
FROM OPERATIONS $(10,803,543)
- ------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
34
<PAGE> 35
P-I-C
-----
GROWTH STATEMENT OF CHANGES IN NET ASSETS
------
PORTFOLIO
- ---------
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------
(DECREASE) INCREASE IN NET ASSETS:
- ---------------------------------------------------------------------------------
Year Year
ended ended
From operations: October 31, 1996 October 31, 1995
- ---------------------------------------------------------------------------------
<S> <C> <C>
Net investment (loss) income $ (34,806) $ 149,206
Net realized gain on investments 17,614,277 3,599,901
Change in net unrealized (depreciation)
appreciation on investments (28,383,014) 36,436,183
- ---------------------------------------------------------------------------------
Net (decrease) increase in net assets
resulting from operations (10,803,543) 40,185,290
- ---------------------------------------------------------------------------------
Transactions in Interests:
Contributions by Holders 19,462,190 37,495,575
Withdrawals by Holders (122,401,366) (25,350,557)
- ---------------------------------------------------------------------------------
Net (decrease) increase in net assets
from transactions in interests (102,939,176) 12,145,018
- ---------------------------------------------------------------------------------
Total (decrease) increase in net assets (113,742,719) 52,330,308
- ---------------------------------------------------------------------------------
NET ASSETS
- ---------------------------------------------------------------------------------
Beginning of year 229,842,248 177,511,940
- ---------------------------------------------------------------------------------
End of year $116,099,529 $229,842,248
- ---------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
35
<PAGE> 36
P-I-C
-----
GROWTH SELECTED RATIO DATA
------
PORTFOLIO
- ---------
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------
Year Year Year Year
ended ended ended ended
Oct. 31, 1996 Oct. 31, 1995 Oct. 31, 1994 Oct. 31, 1993
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Ratios to average net assets:++
Operating expenses 1.00% 1.00% 1.00% 1.00%
Net investment (loss) income (0.04%) 0.08% 0.10% 0.17%
Portfolio turnover rate 64.09% 54.89% 68.26% 43.20%
Average commission rate paid* $0.0440 - - -
</TABLE>
- ----------
++Net of expense reimbursements equivalent to 0.04%, 0.01%, 0.01% and 0.09% of
average net assets, respectively.
*For fiscal years beginning on or after September 1, 1995, a fund is required to
disclose its average commission rate per share for security trades on which
commissions are charged.
36
<PAGE> 37
[ P-I-C LOGO ] P-I-C
INSTITUTIONAL
SMALL-CAP-FUND
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------
ASSETS
- -------------------------------------------------------------------------
<S> <C>
Investment in P-I-C Small Cap. Portfolio, at value $5,192,157
Receivables:
Investments sold in P-I-C Small Cap. Portfolio 53,637
Fund shares sold 7,219
From Provident Investment Counsel (Note 3) 16,814
- -------------------------------------------------------------------------
Total assets 5,269,827
- -------------------------------------------------------------------------
LIABILITIES
- -------------------------------------------------------------------------
Payables:
Fund shares redeemed 53,637
For Investments purchased in P-I-C Small Cap. Portfolio 7,219
Deferred Trustees' compensation (Note 3) 1,474
Accrued expenses 23,920
- -------------------------------------------------------------------------
Total liabilities 86,250
- -------------------------------------------------------------------------
NET ASSETS
- -------------------------------------------------------------------------
Applicable to 546,774 shares of beneficial interest
outstanding $5,183,577
- -------------------------------------------------------------------------
NET ASSET VALUE PER SHARE $ 9.48
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
SOURCE OF NET ASSETS
- -------------------------------------------------------------------------
Paid-in capital $5,280,636
Accumulated net investment loss (14,484)
Accumulated net realized loss on investments (500,014)
Net unrealized appreciation on investments 417,439
- -------------------------------------------------------------------------
Net Assets $5,183,577
- -------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
37
<PAGE> 38
[ P-I-C LOGO ] P-I-C STATEMENT OF OPERATIONS
INSTITUTIONAL Period ended October 31, 1996*
SMALL-CAP-FUND
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------
INVESTMENT INCOME
- ---------------------------------------------------------------------
<S> <C>
Net investment loss from Portfolio $ (7,499)
- ---------------------------------------------------------------------
Expenses
- ---------------------------------------------------------------------
Administration fees (Note 3) 8,104
Reports to shareholders 6,000
Trustees' fees 2,974
Auditing fee 11,000
Legal fee 2,517
Transfer agent's fee 6,500
Custody and accounting services fee 2,000
Registration fee 5,000
Miscellaneous 4,193
---------------------------------------------------------------
Total expenses 48,288
Less, reimbursement/waiver by Provident
Investment Counsel, Inc. (Note 3) (41,303)
---------------------------------------------------------------
Net expenses 6,985
- ---------------------------------------------------------------------
Net investment loss (14,484)
- ---------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
- ---------------------------------------------------------------------
Net realized loss on investments (500,014)
Change in net unrealized appreciation on investments 417,439
- ---------------------------------------------------------------------
Net loss on investments (82,575)
- ---------------------------------------------------------------------
NET DECREASE IN NET ASSETS RESULTING FROM
OPERATIONS $ (97,059)
- ---------------------------------------------------------------------
</TABLE>
*June 28, 1996 (commencement of operations) through October 31, 1996.
See Notes to Financial Statements.
38
<PAGE> 39
[ P-I-C LOGO ] P-I-C STATEMENT OF CHANGES IN NET ASSETS
INSTITUTIONAL Period ended October 31, 1996*
SMALL-CAP-FUND
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------
INCREASE IN NET ASSETS
- --------------------------------------------------------------------------
<S> <C>
From operations:
- --------------------------------------------------------------------------
Net investment loss $ (14,484)
Net realized loss on investments (500,014)
Change in unrealized appreciation of investments 417,439
- --------------------------------------------------------------------------
Net decrease in net assets resulting from operations (97,059)
- --------------------------------------------------------------------------
Transactions in shares of beneficial interest:
Purchases of 1,600,082 shares 15,762,982
Redemptions of 1,053,308 shares (10,482,346)
- --------------------------------------------------------------------------
Net increase in net assets resulting from share
transactions 5,280,636
- --------------------------------------------------------------------------
Total increase in net assets 5,183,577
- --------------------------------------------------------------------------
NET ASSETS
- --------------------------------------------------------------------------
Beginning of period 0
- --------------------------------------------------------------------------
End of period $ 5,183,577
- --------------------------------------------------------------------------
</TABLE>
*June 28, 1996 (commencement of operations) through October 31, 1996.
See Notes to Financial Statements.
39
<PAGE> 40
[ P-I-C LOGO ] P-I-C FINANCIAL HIGHLIGHTS
INSTITUTIONAL
SMALL-CAP-FUND
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
- --------------------------------------------------------------------------
June 28, 1996*
through
October 31, 1996
- --------------------------------------------------------------------------
<S> <C>
Net asset value, beginning of period $ 10.00
Income from investment operations:
Net investment loss (.03)
Net realized and unrealized
loss on investments (.49)
- --------------------------------------------------------------------------
Total from investment operations (.52)
- --------------------------------------------------------------------------
Net asset value, end of period $ 9.48
- --------------------------------------------------------------------------
Total return (5.20)%
- --------------------------------------------------------------------------
Ratios/supplemental data:
Net assets, end of period (millions) $ 5.2
- --------------------------------------------------------------------------
Ratios to average net assets:**
Expenses 1.43%++
Net investment loss (0.91)%++
</TABLE>
- ----------
*Commencement of operations.
**Includes the Fund's shares of expenses, net of expense reimbursements and
waivers, allocated from P-I-C Small Cap. Portfolio. If the expense
reimbursement and waivers, with respect to the Fund and P-I-C Small Cap.
Portfolio, had not been made, the ratio of expenses to average net assets
would have been 4.03%.
++Annualized.
40
<PAGE> 41
P-I-C
-----
SMALL CAP. STATEMENT OF NET ASSETS
---------- as of October 31, 1996
PORTFOLIO
---------
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------
Percentage of
EQUITY SECURITIES - 91.2% Shares Value Net Assets
- --------------------------------------------------------------------------
<S> <C> <C> <C>
AIR FREIGHT .. 0.9%
- --------------------------------------------------------------------------
Atlas Air, Inc.* 22,700 $ 837,062 0.4%
Eagle USA Airfreight, Inc.* 34,900 951,025 0.5%
- --------------------------------------------------------------------------
Total Air Freight 1,788,087
- --------------------------------------------------------------------------
APPAREL AND SHOE .. 1.5%
- --------------------------------------------------------------------------
Amercrombie & Fitch Co.* 27,400 602,800 0.3%
Hibbett Sporting Goods, Inc.* 11,600 237,800 0.1%
Just For Feet, Inc.* 37,450 969,019 0.5%
Kenneth Cole Productions* 68,000 1,122,000 0.6%
- --------------------------------------------------------------------------
Total Apparel and Shoe 2,931,619
- --------------------------------------------------------------------------
AUDIO/VIDEO .. 0.8%
- --------------------------------------------------------------------------
Harman International Industries, Inc. 32,195 1,654,018 0.8%
- --------------------------------------------------------------------------
AUTO PARTS .. 0.3%
- --------------------------------------------------------------------------
Gentex Corp.* 27,200 646,000 0.3%
- --------------------------------------------------------------------------
BIOTECHNOLOGY .. 0.4%
- --------------------------------------------------------------------------
Martek Biosciences Corp.* 13,300 285,950 0.1%
Neopath, Inc.* 26,700 435,544 0.2%
Neuromedical Systems, Inc.* 5,200 88,400 0.1%
- --------------------------------------------------------------------------
Total Biotechnology 809,894
- --------------------------------------------------------------------------
BUILDERS .. 0.9%
- --------------------------------------------------------------------------
Oakwood Homes Corp. 35,500 940,750 0.5%
Palm Harbor Homes, Inc.* 28,475 800,859 0.4%
- --------------------------------------------------------------------------
Total Builders 1,741,609
</TABLE>
41
<PAGE> 42
P-I-C
-----
SMALL CAP. STATEMENT OF NET ASSETS
---------- as of October 31, 1996
PORTFOLIO
---------
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Percentage of
EQUITY SECURITIES, CONTINUED Shares Value Net Assets
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
BUILDING PRODUCTS .. 2.5%
- --------------------------------------------------------------------------------
Diamond Home Services* 23,400 $ 538,200 0.3%
Fastenal Co.* 96,400 4,458,500 2.2%
- --------------------------------------------------------------------------------
Total Building Products 4,996,700
- --------------------------------------------------------------------------------
BUSINESS INFORMATION SERVICES .. 0.5%
- --------------------------------------------------------------------------------
Intelliquest Information Group, Inc.* 16,500 363,000 0.2%
M.A.I.D. PLC ADR* 31,100 553,969 0.3%
- --------------------------------------------------------------------------------
Total Business Information Services 916,969
- --------------------------------------------------------------------------------
BUSINESS SERVICES .. 4.8%
- --------------------------------------------------------------------------------
Accustaff Inc.* 95,000 2,541,250 1.3%
Apac Teleservices, Inc.* 32,400 1,494,450 0.7%
Career Horizons* 22,600 918,125 0.4%
Claremont Technology Group, Inc.* 15,000 457,500 0.2%
Dendrite International, Inc.* 6,100 162,412 0.1%
Health Management Systems, Inc.* 32,125 754,937 0.4%
Labor Ready, Inc.* 9,900 142,313 0.1%
Personnel Group of America* 26,800 740,350 0.4%
Protection One, Inc.* 23,500 264,375 0.1%
Romac International, Inc.* 23,200 667,000 0.3%
Rural Metro Corp.* 20,200 737,300 0.4%
Teletech Holdings, Inc.* 6,700 214,400 0.1%
U.S. Office Products Co.* 20,600 597,400 0.3%
- --------------------------------------------------------------------------------
Total Business Services 9,691,812
- --------------------------------------------------------------------------------
COMPUTER HARDWARE .. 1.1%
- --------------------------------------------------------------------------------
Brooktrout Technology, Inc.* 33,600 1,083,600 0.5%
International Network Services* 4,400 157,300 0.1%
National Techteam, Inc.* 36,300 980,100 0.5%
- --------------------------------------------------------------------------------
Total Computer Hardware 2,221,000
</TABLE>
42
<PAGE> 43
P-I-C
-----
SMALL CAP. STATEMENT OF NET ASSETS
---------- as of October 31, 1996
PORTFOLIO
---------
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------
Percentage of
EQUITY SECURITIES, CONTINUED Shares Value Net Assets
- ---------------------------------------------------------------------------
<S> <C> <C> <C>
COMPUTER SERVICES .. 4.4%
- ---------------------------------------------------------------------------
Cambridge Technology Partners, Inc.* 66,100 $ 2,181,300 1.1%
Datastream Systems, Inc.* 17,600 321,200 0.2%
Enterprise Systems, Inc.* 29,200 470,850 0.2%
Envoy Corp.* 23,300 856,275 0.4%
Fiserv, Inc.* 52,000 1,995,500 1.0%
Gartner Group, Inc., Class A* 36,000 1,107,000 0.6%
HBO & Co. 18,000 1,082,250 0.5%
Indus Group, Inc.* 15,500 313,875 0.2%
Renaissance Solutions, Inc.* 11,400 458,850 0.2%
- ---------------------------------------------------------------------------
Total Computer Services 8,787,100
- ---------------------------------------------------------------------------
COMPUTER SOFTWARE .. 14.3%
- ---------------------------------------------------------------------------
Aspen Technology, Inc.* 27,000 1,815,750 0.9%
Baan Company, N.V.* 15,800 584,600 0.3%
BDM International, Inc.* 23,900 1,200,975 0.6%
CCC Information Services Group* 15,000 281,250 0.1%
Casino Data System* 20,700 297,562 0.1%
Citrix Systems, Inc.* 14,600 806,650 0.4%
Cognos, Inc.* 18,800 589,850 0.3%
Electronics For Imaging, Inc.* 42,000 3,024,000 1.5%
Epic Design Technology, Inc.* 26,300 644,350 0.3%
Gemstar International Group Limited* 21,100 466,837 0.2%
HNC Software, Inc.* 16,700 526,050 0.3%
Integrated Systems, Inc.* 18,700 504,900 0.3%
Intelligroup, Inc.* 8,300 130,725 0.1%
Network General Corp.* 89,700 2,164,013 1.1%
Parametric Technology Corp.* 150,700 7,365,463 3.7%
Peoplesoft, Inc.* 23,700 2,127,075 1.1%
Pure Atria Corp.* 5,000 136,250 0.1%
Rational Software Corp.* 12,700 487,363 0.2%
Synopsys, Inc.* 55,500 2,497,500 1.2%
Transactions Systems Architects, Inc.* 55,700 2,311,550 1.1%
USCS International, Inc.* 22,300 401,400 0.2%
</TABLE>
43
<PAGE> 44
P-I-C
-----
SMALL CAP. STATEMENT OF NET ASSETS
---------- as of October 31, 1996
PORTFOLIO
---------
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------
Percentage of
EQUITY SECURITIES, CONTINUED Shares Value Net Assets
- ----------------------------------------------------------------------
<S> <C> <C> <C>
COMPUTER SOFTWARE, CONTINUED
- ----------------------------------------------------------------------
White Pine Software, Inc.* 9,100 $ 81,900 0.0%
Wind River Systems, Inc.* 8,800 374,000 0.2%
- ----------------------------------------------------------------------
Total Computer Software 28,820,013
- ----------------------------------------------------------------------
CONSUMER ELECTRICAL .. 0.2%
- ----------------------------------------------------------------------
Watsco, Inc. 17,300 335,188 0.2%
- ----------------------------------------------------------------------
COSMETICS .. 2.1%
- ----------------------------------------------------------------------
Blyth Industries, Inc.* 36,900 1,434,487 0.7%
Luxottica Group SPA Sponsored ADR 34,800 2,209,800 1.1%
USA Detergents, Inc.* 16,300 537,900 0.3%
- ----------------------------------------------------------------------
Total Cosmetics 4,182,187
- ----------------------------------------------------------------------
CREDIT & FINANCE .. 1.8%
- ----------------------------------------------------------------------
First USA Paymentech, Inc.* 29,100 1,076,700 0.6%
First USA, Inc. 43,000 2,472,500 1.2%
- ----------------------------------------------------------------------
Total Credit & Finance 3,549,200
- ----------------------------------------------------------------------
DISCOUNT STORES .. 1.3%
- ----------------------------------------------------------------------
Dollar Tree Stores, Inc.* 71,800 2,710,450 1.3%
- ----------------------------------------------------------------------
DRUGS .. 1.2%
- ----------------------------------------------------------------------
Biovail Corp. International* 29,200 854,100 0.4%
Jones Medical Industries, Inc. 16,675 725,363 0.4%
Medicis Pharmaceutical, Class A* 10,400 522,600 0.3%
NCS Healthcare, Inc., Class A* 8,800 267,300 0.1%
- ----------------------------------------------------------------------
Total Drugs 2,369,363
</TABLE>
44
<PAGE> 45
P-I-C
-----
SMALL CAP. STATEMENT OF NET ASSETS
---------- as of October 31, 1996
PORTFOLIO
---------
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------
Percentage of
EQUITY SECURITIES, CONTINUED Shares Value Net Assets
- ------------------------------------------------------------------------------
<S> <C> <C> <C>
EDUCATIONAL PROGRAMS .. 1.5%
- ------------------------------------------------------------------------------
Apollo Group, Inc., Class A* 77,722 $ 2,137,355 1.1%
Sylvan Learning Systems, Inc.* 18,500 781,625 0.4%
- ------------------------------------------------------------------------------
Total Educational Programs 2,918,980
- ------------------------------------------------------------------------------
ELECTRIC COMPONENTS/SEMICONDUCTORS .. 0.2%
- ------------------------------------------------------------------------------
SDL, Inc.* 29,600 503,200 0.2%
- ------------------------------------------------------------------------------
ELECTRICAL PRODUCTS .. 0.5%
- ------------------------------------------------------------------------------
Chicago Miniature Lamp, Inc.* 36,600 1,088,850 0.5%
- ------------------------------------------------------------------------------
ELECTRONICS .. 1.0%
- ------------------------------------------------------------------------------
Anicom, Inc.* 29,400 264,600 0.1%
Computer Products, Inc.* 12,000 237,000 0.1%
Gargoyles, Inc.* 16,200 214,650 0.1%
Sawtek, Inc.* 17,100 517,275 0.3%
Vitesse Semiconductor, Inc.* 20,300 647,063 0.3%
Xionics Document Technologies, Inc.* 8,400 107,100 0.1%
- ------------------------------------------------------------------------------
Total Electronics 1,987,688
- ------------------------------------------------------------------------------
ENTERTAINMENT & LEISURE ..5.8%
- ------------------------------------------------------------------------------
Ascent Entertainment Group, Inc.* 17,100 316,350 0.2%
Clear Channel Communications, Inc.* 26,600 1,941,800 1.0%
Dover Downs Entertainment* 22,900 460,862 0.2%
Extended Stay America* 49,000 992,250 0.5%
HFS, Inc.* 75,700 5,545,025 2.7%
Interstate Hotels Company* 17,100 461,700 0.2%
LodgeNet Entertainment Corp.* 35,200 554,400 0.3%
North Face, Inc.* 10,800 218,700 0.1%
StudioPLUS Hotels, Inc.* 40,950 721,744 0.4%
Suburban Lodges of America* 20,900 436,288 0.2%
- ------------------------------------------------------------------------------
Total Entertainment & Leisure 11,649,119
</TABLE>
45
<PAGE> 46
P-I-C
-----
SMALL CAP. STATEMENT OF NET ASSETS
---------- as of October 31, 1996
PORTFOLIO
---------
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------
Percentage of
EQUITY SECURITIES, CONTINUED Shares Value Net Assets
- ---------------------------------------------------------------------------
<S> <C> <C> <C>
ENVIRONMENTAL SERVICES .. 0.1%
- ---------------------------------------------------------------------------
Tetra Technologies* 4,300 $ 89,763 0.1%
- ---------------------------------------------------------------------------
EQUIPMENT & LEASING .. 0.5%
- ---------------------------------------------------------------------------
Oxford Resources Corp., Class A* 32,400 826,200 0.4%
Prime Service, Inc.* 11,600 272,600 0.1%
- ---------------------------------------------------------------------------
Total Equipment & Leasing 1,098,800
- ---------------------------------------------------------------------------
FINANCE COMPANIES .. 0.1%
- ---------------------------------------------------------------------------
Leasing Solution* 7,500 236,250 0.1%
- ---------------------------------------------------------------------------
FINANCIAL SERVICES .. 2.7%
- ---------------------------------------------------------------------------
Bisys Group, Inc.* 31,100 1,158,475 0.6%
Concord EFS, Inc.* 33,800 980,200 0.5%
NOVA Corp.* 1,700 36,975 0.0%
PMT Services, Inc.* 104,500 2,090,000 1.0%
Sirrom Capital Corp. 33,300 1,215,450 0.6%
- ---------------------------------------------------------------------------
Total Financial Services 5,481,100
- ---------------------------------------------------------------------------
FOOD AND RESTAURANTS .. 1.2%
- ---------------------------------------------------------------------------
Cooker Restaurant Corp. 21,000 231,000 0.1%
Landry's Seafood Restaurant* 41,400 848,700 0.4%
Outback Steakhouse, Inc.* 13,100 303,756 0.2%
Rainforest Cafe, Inc.* 29,700 965,250 0.5%
- ---------------------------------------------------------------------------
Total Food and Restaurants 2,348,706
- ---------------------------------------------------------------------------
GAMING .. 0.1%
- ---------------------------------------------------------------------------
Trump Hotels & Casino Resorts, Inc.* 18,600 295,275 0.1%
- ---------------------------------------------------------------------------
HEALTH MAINTENANCE ORGANIZATIONS .. 4.1%
- ---------------------------------------------------------------------------
Oxford Health Plans, Inc.* 183,400 8,344,700 4.1%
</TABLE>
46
<PAGE> 47
P-I-C
-----
SMALL CAP. STATEMENT OF NET ASSETS
---------- as of October 31, 1996
PORTFOLIO
---------
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------
Percentage of
EQUITY SECURITIES, CONTINUED Shares Value Net Assets
- ---------------------------------------------------------------------------
<S> <C> <C> <C>
HEALTH SERVICES .. 0.6%
- ---------------------------------------------------------------------------
Clintrials* 14,100 $ 523,462 0.3%
National Surgery Centers, Inc.* 17,400 469,800 0.2%
Superior Consultant Holdings Corp.* 11,000 269,500 0.1%
- ---------------------------------------------------------------------------
Total Health Services 1,262,762
- ---------------------------------------------------------------------------
INDUSTRIAL MACHINERY/COMPONENTS .. 0.2%
- ---------------------------------------------------------------------------
Rental Service Corp.* 20,900 480,700 0.2%
- ---------------------------------------------------------------------------
INSURANCE .. 1.9%
- ---------------------------------------------------------------------------
Amerin Corp.* 6,900 136,275 0.1%
Capmac Holdings, Inc. 21,000 700,875 0.3%
Enhance Financial Services Group, Inc. 10,800 360,450 0.2%
HCC Insurance Holdings, Inc. 89,100 2,272,050 1.1%
Meadowbrook Insurance Group, Inc. 13,300 339,150 0.2%
- ---------------------------------------------------------------------------
Total Insurance 3,808,800
- ---------------------------------------------------------------------------
MAJOR CHEMICALS .. 0.1%
- ---------------------------------------------------------------------------
Nuco2, Inc.* 20,100 266,325 0.1%
- ---------------------------------------------------------------------------
MEDICAL INSTRUMENTS .. 3.4%
- ---------------------------------------------------------------------------
IDEXX Laboratories, Inc.* 126,600 4,969,050 2.5%
Target Therapeutics, Inc.* 50,600 1,872,200 0.9%
- ---------------------------------------------------------------------------
Total Medical Instruments 6,841,250
- ---------------------------------------------------------------------------
MEDICAL/DENTAL PRODUCTS ..0.8%
- ---------------------------------------------------------------------------
Cohr, Inc.* 7,800 191,100 0.1%
Henry Schein, Inc.* 35,500 1,411,125 0.7%
- ---------------------------------------------------------------------------
Total Medical/Dental Products 1,602,225
</TABLE>
47
<PAGE> 48
P-I-C
-----
SMALL CAP. STATEMENT OF NET ASSETS
---------- as of October 31, 1996
PORTFOLIO
---------
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
Percentage of
EQUITY SECURITIES, CONTINUED Shares Value Net Assets
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
MEDICAL/DENTAL SERVICES .. 5.0%
- -------------------------------------------------------------------------------
Compdent Corp.* 34,100 $ 1,172,187 0.6%
Mecon, Inc.* 12,700 244,475 0.1%
Occusystems, Inc.* 30,800 843,150 0.4%
Omnicare, Inc. 29,500 803,875 0.4%
Orthodontic Centers of America, Inc.* 74,000 1,063,750 0.5%
Pediatrix Medical Group, Inc.* 21,300 838,688 0.4%
Phymatrix Corp.* 27,900 463,838 0.2%
Physicians Resource Group, Inc.* 20,300 548,100 0.3%
Quintiles Transnational Corp.* 28,100 1,847,575 0.9%
Renal Care Group, Inc.* 20,600 762,200 0.4%
Total Renal Care Holdings, Inc.* 34,600 1,349,400 0.7%
UroCor, Inc.* 19,000 223,250 0.1%
- -------------------------------------------------------------------------------
Total Medical/Dental Services 10,160,488
- -------------------------------------------------------------------------------
MID-SIZED BANKS .. 0.2%
- -------------------------------------------------------------------------------
Mentor Corp. / Minnesota 17,400 384,975 0.2%
- -------------------------------------------------------------------------------
MORTGAGE & RELATED SERVICES .. 2.6%
- -------------------------------------------------------------------------------
Cityscape Financial Corp.* 72,500 1,866,875 0.9%
ContiFinancial Corp.* 21,800 708,500 0.4%
IMC Mortgage Company* 9,500 356,250 0.2%
Insignia Financial Group, Inc., Class A* 107,000 2,313,875 1.1%
- -------------------------------------------------------------------------------
Total Mortgage & Related Services 5,245,500
- -------------------------------------------------------------------------------
NETWORKING .. 1.5%
- -------------------------------------------------------------------------------
Ascend Communications, Inc.* 28,100 1,837,037 0.9%
Fore Systems, Inc.* 30,700 1,220,325 0.6%
- -------------------------------------------------------------------------------
Total Networking 3,057,362
- -------------------------------------------------------------------------------
OFFICE AUTOMATION .. 0.1%
- -------------------------------------------------------------------------------
Lason Holdings, Inc.* 8,500 150,875 0.1%
</TABLE>
48
<PAGE> 49
P-I-C
-----
SMALL CAP. STATEMENT OF NET ASSETS
---------- as of October 31, 1996
PORTFOLIO
---------
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------
Percentage of
EQUITY SECURITIES, CONTINUED Shares Value Net Assets
- -----------------------------------------------------------------------------
<S> <C> <C> <C>
OFFICE EQUIPMENT/SUPPLIES .. 2.0%
- -----------------------------------------------------------------------------
Elbit Vision Systems* 35,600 $ 213,600 0.1%
Viking Office Products, Inc.* 130,200 3,792,075 1.9%
- -----------------------------------------------------------------------------
Total Office Equipment /Supplies 4,005,675
- -----------------------------------------------------------------------------
OIL & GAS PRODUCTION .. 0.5%
- -----------------------------------------------------------------------------
Swift Energy Co.* 41,700 1,021,650 0.5%
- -----------------------------------------------------------------------------
OIL FIELD SERVICES .. 0.9%
- -----------------------------------------------------------------------------
Chesapeake Energy Corp.* 31,950 1,861,087 0.9%
- -----------------------------------------------------------------------------
PHARMACEUTICALS .. 0.5%
- -----------------------------------------------------------------------------
Applied Analytical Industries, Inc.* 1,700 36,975 0.0%
Capstone Pharmacy Services* 23,600 275,825 0.1%
Dura Pharmaceuticals* 21,200 731,400 0.4%
- -----------------------------------------------------------------------------
Total Pharmaceuticals 1,044,200
- -----------------------------------------------------------------------------
POLLUTION CONTROL .. 3.3%
- -----------------------------------------------------------------------------
Continental Waste Industries, Inc.* 20,066 499,142 0.2%
Memtec Ltd. ADR 51,000 1,740,375 0.9%
Republic Industries, Inc.* 63,000 1,960,875 1.0%
United Waste Systems, Inc.* 41,100 1,412,813 0.7%
USA Waste Services, Inc.* 33,800 1,081,600 0.5%
- -----------------------------------------------------------------------------
Total Pollution Control 6,694,805
- -----------------------------------------------------------------------------
RECREATIONAL PRODUCTS .. 0.2%
- -----------------------------------------------------------------------------
Rockshox, Inc.* 13,600 173,400 0.1%
West Marine* 6,500 229,125 0.1%
- -----------------------------------------------------------------------------
Total Recreational Products 402,525
</TABLE>
49
<PAGE> 50
P-I-C
-----
SMALL CAP. STATEMENT OF NET ASSETS
---------- as of October 31, 1996
PORTFOLIO
---------
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------
Percentage of
EQUITY SECURITIES, CONTINUED Shares Value Net Assets
- ---------------------------------------------------------------------------
<S> <C> <C> <C>
SPECIALTY CHAINS .. 1.5%
- ---------------------------------------------------------------------------
Barnett, Inc.* 15,500 $ 366,187 0.2%
CDW Computers Centers, Inc.* 16,800 1,057,350 0.5%
Loehmann's Holdings, Inc.* 17,800 478,375 0.2%
Marks Brothers Jewelers, Inc.* 15,900 369,675 0.2%
Starbucks Corp.* 12,800 416,000 0.2%
Veterinary Centers of America* 19,300 354,638 0.2%
- ---------------------------------------------------------------------------
Total Specialty Chains 3,042,225
- ---------------------------------------------------------------------------
TELECOMMUNICATIONS .. 6.0%
- ---------------------------------------------------------------------------
Advanced Fibre Communication* 8,700 496,987 0.3%
Aspect Telecommunications Corp.* 19,300 1,148,350 0.6%
Cascade Communications Corp.* 44,400 3,224,550 1.6%
Coherent Communications System Corp.* 35,500 687,812 0.3%
Davox Corp.* 8,300 298,800 0.2%
DSP Communications, Inc.* 42,400 1,611,200 0.8%
Getty Communications PLC,
Sponsored ADR* 32,800 451,000 0.2%
Inter-Tel, Inc., Class A* 26,800 405,350 0.2%
McLeod, Inc.* 16,700 542,750 0.3%
MRV Communications, Inc.* 44,500 967,875 0.5%
P-Com, Inc.* 44,500 979,000 0.5%
Tel-Save Holdings, Inc.* 40,250 1,006,250 0.5%
- ---------------------------------------------------------------------------
Total Telecommunications 11,819,924
- ---------------------------------------------------------------------------
TEXTILES & SHOES .. 2.8%
- ---------------------------------------------------------------------------
Tommy Hilfiger Corp.* 108,500 5,642,000 2.8%
- ---------------------------------------------------------------------------
TOBACCO .. 0.3%
- ---------------------------------------------------------------------------
Consolidated Cigar Holdings, Inc.* 25,000 681,250 0.3%
- ---------------------------------------------------------------------------
Total Common Stock (Cost $110,918,705) 183,670,243
</TABLE>
50
<PAGE> 51
P-I-C
-----
SMALL CAP. STATEMENT OF NET ASSETS
---------- as of October 31, 1996
PORTFOLIO
---------
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------
Percentage of
SHORT-TERM SECURITIES - 8.6% Shares Value Net Assets
- ------------------------------------------------------------------------
<S> <C> <C> <C>
COMMERCIAL PAPER .. 7.5%
- ------------------------------------------------------------------------
American Express Credit Corp.,
5.26%, 11/14/96 $6,000,000 $ 6,000,000 3.0%
Ford Motor Credit Co., 5.26%,
11/14/96 6,000,000 6,000,000 3.0%
Prudential Funding Corp.,
5.30%, 11/12/96 3,000,000 3,000,000 1.5%
- ------------------------------------------------------------------------
Total Commercial Paper
(Cost $15,000,000) 15,000,000 7.5%
- ------------------------------------------------------------------------
REPURCHASE AGREEMENT .. 1.1%
- ------------------------------------------------------------------------
Lehman Brothers On-Line
Repurchase Agreement, 5.04%,
dated 12/13/93, due 11/1/96
(Collateralized by $2,193,996
U.S. Treasury Bill, 5.09%, due
4/3/97) (Cost $2,130,300) 2,130,300 2,130,300 1.1%
- ------------------------------------------------------------------------
Total Investments
(Cost $128,049,005) 200,800,543 99.8%
</TABLE>
51
<PAGE> 52
P-I-C
-----
SMALL CAP. STATEMENT OF NET ASSETS
---------- as of October 31, 1996
PORTFOLIO
---------
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------
Percentage of
OTHER ASSETS - 1.1% Value Net Assets
- ---------------------------------------------------------------------------
<S> <C> <C>
Cash $ 69
Receivables:
Investment securities sold 2,198,028
Dividends and interest 68,439
Shares of beneficial interest sold 7,218
Deferred organization costs 20,001
Other assets 13,254
- ---------------------------------------------------------------------------
Total other assets 2,307,009 1.1%
- ---------------------------------------------------------------------------
LIABILITIES - (0.9%)
- ---------------------------------------------------------------------------
Payable for investment securities purchased 1,534,102
Shares of beneficial interest redeemed 70,416
Deferred Trustees' compensation (Note 3) 7,713
Accrued expenses 194,645
- ---------------------------------------------------------------------------
Total liabilities 1,806,876 (0.9)%
- ---------------------------------------------------------------------------
TOTAL NET ASSETS - 100.0% $201,300,676 100.0%
- ---------------------------------------------------------------------------
</TABLE>
*Non-income producing security.
See Notes to Financial Statements.
52
<PAGE> 53
P-I-C
SMALL CAP STATEMENT OF OPERATIONS
PORTFOLIO Year ended October 31, 1996
<TABLE>
================================================================================
INVESTMENT INCOME
- --------------------------------------------------------------------------------
Income:
- --------------------------------------------------------------------------------
<S> <C>
Dividends $ 108,873
Interest 593,787
Other 4,857
- --------------------------------------------------------------------------------
Total income 707,517
================================================================================
Expenses:
- --------------------------------------------------------------------------------
Investment advisory fee (Note 3) 1,395,748
Administration fees 174,469
Accounting services fee 79,887
Custodian fee 55,572
Auditing fee 20,499
Trustees' fees 17,134
Legal fee 4,000
Amortization of organization costs 9,999
Miscellaneous 13,476
- --------------------------------------------------------------------------------
Total expenses 1,770,784
Less, reimbursement/waiver from Advisor (Note 3) (26,098)
- --------------------------------------------------------------------------------
Net expenses 1,744,686
================================================================================
Net investment loss (1,037,169)
================================================================================
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS
- --------------------------------------------------------------------------------
Net realized gain from security transactions 14,963,528
Change in net unrealized appreciation on
investments for the period 18,982,622
- --------------------------------------------------------------------------------
Net gain on investments 33,946,150
================================================================================
NET INCREASE IN NET ASSETS RESULTING FROM
OPERATIONS $ 32,908,981
- --------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
53
<PAGE> 54
P-I-C
SMALL CAP STATEMENT OF CHANGES IN NET ASSETS
PORTFOLIO
<TABLE>
<CAPTION>
================================================================================
INCREASE IN NET ASSETS
- --------------------------------------------------------------------------------
<S> <C> <C>
Year Year
ended ended
From operations: October 31, 1996 October 31, 1995
- --------------------------------------------------------------------------------
Net investment loss $ (1,037,169) $ (488,788)
Net realized gain (loss) on
investments 14,963,528 (792,768)
Change in net unrealized appreciation
on investments 18,982,622 39,983,109
- --------------------------------------------------------------------------------
Net increase in net assets resulting
from operations 32,908,981 38,701,553
================================================================================
Transactions in interests:
Contributions by Holders 57,035,094 12,662,902
Withdrawals by Holders (18,975,416) (5,287,514)
- --------------------------------------------------------------------------------
Net increase in net assets from
transactions in interests 38,059,678 7,375,388
================================================================================
Total increase in net assets 70,968,659 46,076,941
================================================================================
NET ASSETS:
- --------------------------------------------------------------------------------
Beginning of year 130,332,017 84,255,076
- --------------------------------------------------------------------------------
End of year $ 201,300,676 $ 130,332,017
- --------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
54
<PAGE> 55
P-I-C
SMALL CAP SELECTED RATIO DATA
PORTFOLIO
<TABLE>
<CAPTION>
==========================================================================================================
Year Year Year Sept. 30, 1993*
ended ended ended through
Oct. 31, 1996 Oct. 31, 1995 Oct. 31, 1994 Oct. 31, 1993
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Ratios to average net assets:++
Operating expenses 1.00% 1.00% 1.00% 1.00%+
Net investment loss (.59%) (.51%) (.49%) (.79%)+
Portfolio turnover rate 53.11% 45.45% 63.89% 6.06%
Average commission rate paid** $ 0.0307 -- -- --
</TABLE>
*Commencement of Operations.
++Net of expense reimbursements equivalent to 0.01%, 0.07%, 0.10% and 0.11% of
average net assets, respectively.
+Annualized.
**For fiscal years beginning on or after September 1, 1995, a fund is required
to disclose its average commission rate per share for security trades on which
commissions are charged.
55
<PAGE> 56
[ P-I-C LOGO ] P-I-C NOTES TO FINANCIAL STATEMENTS
INSTITUTIONAL
SMALL CAP FUND
GROWTH FUND - BALANCED FUND
================================================================================
1 - ORGANIZATION
- --------------------------------------------------------------------------------
P-I-C Investment Trust (the "Trust") was organized on December 11, 1991
as a Delaware business trust, with an unlimited number of shares of beneficial
interest of $.01 par value, and is registered under the Investment Company Act
of 1940 as an open-end, diversified management investment company. The Trust
currently offers four separate series: P-I-C Institutional Balanced Fund, P-I-C
Institutional Growth Fund, P-I-C Institutional Small Cap. Fund and P-I-C Small
Cap. Growth Fund (included in another report) (each a "Fund" and collectively
the "Funds"). The Funds invest substantially all of their assets in the
respective Portfolios, a separate registered management investment company
having the same investment objective as the Funds. The financial statements of
the Portfolios are included elsewhere in this report and should be read in
conjunction with the Funds' financial statements.
2 - SIGNIFICANT ACCOUNTING POLICIES
- --------------------------------------------------------------------------------
The following is a summary of significant accounting policies
consistently followed by the Funds. These policies are in conformity with
generally accepted accounting principles.
A. Investment Valuation. Each Fund reflects its investment in the
Portfolio at its proportionate interest in the value of the Portfolio's
net assets. Valuation of securities by the Portfolio is discussed at
Note 2A of the Portfolio's Notes to Financial Statements.
B. Investment Income and Dividends to Shareholders. Each Fund earns
income, net of the expenses of the Portfolio, daily on its investment
in the Portfolio. All net investment income and realized and unrealized
gains or losses on investments of the Portfolio are allocated pro rata
among the Fund and the other Holders of Interests in the Portfolio.
Dividends, if any, are paid annually to shareholders of the Fund and
recorded on the ex-dividend date.
C. Federal Income Taxes. Each Fund intends to comply with the requirements
of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its
shareholders. Therefore, no federal income tax provision is required.
D. Accounting Estimates. In preparing financial statements in conformity
with generally accepted accounting principles, management makes
56
<PAGE> 57
[ P-I-C LOGO ] P-I-C NOTES TO FINANCIAL STATEMENTS
INSTITUTIONAL CONTINUED
SMALL CAP FUND
GROWTH FUND - BALANCED FUND
================================================================================
estimates and assumptions that affect the reported amounts of assets
and liabilities at the date of the financial statements, as well as the
reported amounts of revenues and expenses during the period. Actual
results could differ from those estimates.
3 - TRANSACTIONS WITH AFFILIATES
- --------------------------------------------------------------------------------
The Trust has entered into administration agreements with Provident
Investment Counsel, Inc. ("PIC") and Investment Company Administration
Corporation ("ICAC"), pursuant to which agreements certain employees of these
entities serve as officers and/or trustees of the Trust and the Portfolio. PIC
and ICAC also provide management services necessary for the operations of the
Trust and the Portfolio and furnish office facilities. PIC receives a fee for
its services to the Fund at the rate of 0.20% of the average daily net assets of
the Fund.
P-I-C has voluntarily taken to limit the Funds' expenses, including
those expenses allocated from the Portfolios, to the following levels:
<TABLE>
<S> <C>
Balanced Fund 1.05%
Growth Fund 1.25%
Small Cap. Fund 1.45%
</TABLE>
The percentages are based on the Funds' average net assets. Fees waived
and expenses reimbursed by PIC for the fiscal year ended October 31, 1996, were
as follows:
<TABLE>
<CAPTION>
Waived Reimbursed
Fees Expenses
---- --------
<S> <C> <C>
Balanced Fund $24,822 $58,485
Growth Fund 55,034 0
Small Cap. Fund 3,105 38,198
</TABLE>
ICAC receives an annual fee for its services of $15,000 from each of
the Funds.
First Fund Distributors, Inc. (an affiliate of ICAC), a registered
broker-dealer, acts as the principal underwriter for the Trust in connection
with the offering of its shares, but receives no compensation for its services.
57
<PAGE> 58
[ P-I-C LOGO ] P-I-C NOTES TO FINANCIAL STATEMENTS
INSTITUTIONAL CONTINUED
SMALL CAP FUND
GROWTH FUND - BALANCED FUND
================================================================================
On December 19, 1995, the Trust approved a Deferred Compensation Plan
for Trustees (the "Plan"). Trustees are entitled to receive $2,500 per quarter
and $500 per meeting attended which is allocated amongst the Funds. Trustees can
elect to receive payment in cash or defer payments provided for in the plan.
4 - INVESTMENT TRANSACTIONS
- --------------------------------------------------------------------------------
Additions and reductions in the investments in the respective
Portfolios for the fiscal year ended October 31, 1996, were as follows:
<TABLE>
<CAPTION>
Additions Reductions
<S> <C> <C>
Balanced Fund $ 904,221 $ 2,068,351
Growth Fund 17,595,463 48,668,710
Small Cap. Fund 15,783,967 10,501,735
</TABLE>
58
<PAGE> 59
P-I-C
BALANCED NOTES TO FINANCIAL STATEMENTS
GROWTH
SMALL CAP
PORTFOLIOS
================================================================================
1 - ORGANIZATION
- --------------------------------------------------------------------------------
P-I-C Balanced and Growth Portfolios were organized on December 11,
1991 and P-I-C Small Cap. Portfolio was organized on March 22, 1993 as separate
trusts under the laws of the State of New York (each a "Portfolio" and
collectively the "Portfolios"). The beneficial interests in each Portfolio are
divided into an unlimited number of non-transferable interests, par value $.01
each. The Portfolios are registered under the Investment Company Act of 1940 as
open-end, diversified management investment companies.
2 - SIGNIFICANT ACCOUNTING POLICIES
- --------------------------------------------------------------------------------
The following is a summary of significant accounting policies
consistently followed by the Portfolios. These policies are in conformity with
generally accepted accounting principles.
A. Valuation of Securities. Equity securities listed on a national
securities exchange or traded on the NASDAQ system are valued at their
last sale price. Other equity securities and debt securities for which
market quotations are readily available are valued at the mean between
their bid and asked price, except that debt securities maturing within
60 days are valued on an amortized cost basis. Securities for which
market quotations are not readily available are valued at fair value as
determined in good faith by the Board of Trustees.
B. Federal Income Taxes. Each Portfolio intends to comply with the
requirements of the Internal Revenue Code applicable to it. Therefore,
no federal income tax provision is required.
C. Deferred Organization Expense. Organization costs of the Portfolios are
being amortized on a straight line basis over a period of sixty months.
During the amortization period the proceeds of any redemption of the
original Interests in a Portfolio by any Holder thereof will be reduced
by a pro rata portion of any then unamortized organization costs based
on the ratio of Interests redeemed to the total initial Interests
outstanding prior to the redemption.
D. Other. Securities transactions are recorded on the trade date basis.
Realized gains and losses from securities transactions are reported on
an identified cost basis. Interest is recorded as accrued, and dividend
income is recorded on the ex-dividend date.
59
<PAGE> 60
P-I-C
BALANCED NOTES TO FINANCIAL STATEMENTS
GROWTH CONTINUED
SMALL CAP
PORTFOLIOS
================================================================================
E. Accounting Estimates. In preparing financial statements in conformity
with generally accepted accounting principles, management makes
estimates and assumptions that affect the reported amounts of assets
and liabilities at the date of the financial statements, as well as the
reported amounts of revenues and expenses during the period. Actual
results could differ from those estimates.
3 - TRANSACTIONS WITH AFFILIATES
- --------------------------------------------------------------------------------
Each Portfolio has entered into an investment advisory agreement with
Provident Investment Counsel, Inc. ("PIC") and an administration agreement with
Investment Company Administration Corporation ("ICAC"), pursuant to which
agreements certain employees of these entities serve as officers and/or trustees
of the Portfolios. PIC and ICAC also provide management services necessary for
the operations of the Portfolios and furnish office facilities.
PIC receives from the Balanced Portfolio an investment advisory fee at
the annual rate of 0.60% of its average net assets and 0.80% from each of the
Growth and Small Cap. Portfolios. In addition, PIC has voluntarily taken to
limit the expenses of the Balanced Portfolio to 0.80% of its average net assets
and 1.00% for each of the Growth and Small Cap. Portfolios.
Fees waived and expenses reimbursed by PIC for the fiscal year ended
October 31, 1996, were as follows:
<TABLE>
<CAPTION>
Waived Reimbursed
Fees Expenses
---- --------
<S> <C> <C>
Balanced Fund $74,462 $37,118
Growth Fund 64,401 0
Small Cap. Fund 26,098 0
</TABLE>
ICAC receives for its services a fee at the annual rate of 0.10% of the
average net assets of the Portfolios. Fees paid to ICAC for the fiscal year
ended October 31, 1996 are stated on the respective Portfolios' Statement of
Operations.
On December 19, 1995, each Portfolio approved a Deferred Compensation
Plan for Trustees (the "Plan"). Trustees are entitled to receive $2,500 per
quarter and $500 per meeting attended which is allocated amongst the Portfolios.
Trustees can elect to receive payment in cash or defer payments provided for in
the plan.
60
<PAGE> 61
P-I-C
BALANCED NOTES TO FINANCIAL STATEMENTS
GROWTH CONTINUED
SMALL CAP
PORTFOLIOS
================================================================================
4 - INVESTMENT TRANSACTIONS
- --------------------------------------------------------------------------------
The aggregate purchases and sales of investment securities, other than
short-term obligations, for the fiscal year ended October 31, 1996, were as
follows:
<TABLE>
<CAPTION>
Purchases Sales
--------- -----
<S> <C> <C>
Balanced Portfolio $ 6,529,557 $ 7,457,719
Growth Portfolio 79,868,941 207,453,803
Small Cap. Portfolio 113,056,097 86,753,672
</TABLE>
The aggregate unrealized appreciation and depreciation of investment
securities at October 31, 1996, based on costs for federal income tax purposes,
were as follows:
<TABLE>
<CAPTION>
Tax Gross Gross
Costs of Unrealized Unrealized
Investments Appreciation Depreciation
----------- ------------ ------------
<S> <C> <C> <C>
Balanced Portfolio $ 9,872,096 $ 2,599,725 $ 100,413
Growth Portfolio 87,227,654 28,844,763 755,960
Small Cap. Portfolio 128,049,005 75,710,254 2,958,716
</TABLE>
61
<PAGE> 62
P-I-C
BALANCED INDEPENDENT AUDITOR'S REPORT
PORTFOLIO
================================================================================
To the Board of Trustees of,
and the holders of Interests in,
P-I-C Balanced Portfolio
We have audited the accompanying statement of net assets of P-I-C
Balanced Portfolio as of October 31, 1996, the related statement of operations
for the year then ended and the statement of changes in net assets for each of
the two years in the period then ended. These financial statements are the
responsibility of the Portfolio's management. Our responsibility is to express
an opinion on these financial statements based on our audit.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements 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 October 31, 1996 by correspondence with
the custodian and brokers. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of P-I-C Balanced
Portfolio as of October 31, 1996, the results of its operations and the changes
in its net assets for the periods indicated, in conformity with generally
accepted accounting principles.
/s/ McGladrey & Pullen, LLP
New York, New York
November 27, 1996
62
<PAGE> 63
P-I-C
GROWTH INDEPENDENT AUDITOR'S REPORT
PORTFOLIO
================================================================================
To the Board of Trustees of,
and the holders of Interests in,
P-I-C Growth Portfolio
We have audited the accompanying statement of net assets of P-I-C
Growth Portfolio as of October 31, 1996, the related statement of operations for
the year then ended and the statement of changes in net assets for each of the
two years in the period then ended. These financial statements are the
responsibility of the Portfolio's management. Our responsibility is to express
an opinion on these financial statements based on our audit.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements 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 October 31, 1996 by correspondence with
the custodian and brokers. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of P-I-C Growth
Portfolio as of October 31, 1996, the results of its operations and the changes
in its net assets for the periods indicated, in conformity with generally
accepted accounting principles.
/s/ McGladrey & Pullen, LLP
New York, New York
November 27, 1996
63
<PAGE> 64
P-I-C
SMALLCAP. INDEPENDENT AUDITOR'S REPORT
PORTFOLIO
================================================================================
To the Board of Trustees of,
and the holders of Interests in,
P-I-C Small Cap. Portfolio
We have audited the accompanying statement of net assets of P-I-C Small
Cap. Portfolio as of October 31, 1996, the related statement of operations for
the year then ended and the statement of changes in net assets for each of the
two years in the period then ended. These financial statements are the
responsibility of the Portfolio's management. Our responsibility is to express
an opinion on these financial statements based on our audit.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements 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 October 31, 1996 by correspondence with
the custodian and brokers. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of P-I-C Small Cap.
Portfolio as of October 31, 1996, the results of its operations and the changes
in its net assets for the periods indicated, in conformity with generally
accepted accounting principles.
/s/ McGladrey & Pullen, LLP
New York, New York
November 27, 1996
64
<PAGE> 65
P-I-C
[ P-I-C LOGO ] INSTITUTIONAL INDEPENDENT AUDITOR'S REPORT
SMALL CAP FUNDS
GROWTH FUND - BALANCED FUND
================================================================================
To the Board of Trustees of P-I-C Investment Trust and the Shareholders of:
P-I-C Institutional Balanced Fund
P-I-C Institutional Growth Fund
P-I-C Institutional Small Cap. Fund
We have audited the accompanying statements of assets and liabilities as of
October 31, 1996, and the related statements of operations, the statements of
changes in net assets and the financial highlights for each of the periods
indicated of P-I-C Institutional Balanced Fund, P-I-C Institutional Growth Fund,
and P-I-C Institutional Small Cap. Fund. These financial statements and
financial highlights are the responsibility of the Trust's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audit.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. 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 P-I-C
Institutional Balanced Fund, P-I-C Institutional Growth Fund and P-I-C
Institutional Small Cap. Fund as of October 31, 1996, the results of its
operations, the changes in its net assets and the financial highlights for the
periods indicated, in conformity with generally accepted accounting principles.
/s/ McGladrey & Pullen, LLP
New York, New York
November 27, 1996
65
<PAGE> 66
P-I-C
[ P-I-C LOGO ] INSTITUTIONAL TRUSTEES AND OFFICERS
SMALL CAP FUNDS
GROWTH FUND - BALANCED FUND
================================================================================
TRUSTEES AND OFFICERS - P-I-C INVESTMENT TRUST
- --------------------------------------------------------------------------------
Jeffrey J. Miller, Trustee and President
Jettie M. Edwards, Trustee
Bernard J. Johnson, Trustee
Jeffrey D. Lovell, Trustee
Wayne H. Smith, Trustee
Thad M. Brown, Vice President, Secretary and Treasurer
TRUSTEES AND OFFICERS - P-I-C PORTFOLIOS
- --------------------------------------------------------------------------------
Jeffrey J. Miller, Trustee and President
Richard N. Frank, Trustee
James Clayburn LaForce, Trustee
Angelo R. Mozilo, Trustee
Bernard J. Johnson, Trustee Emeritus
Thad M. Brown, Vice President, Secretary and Treasurer
LEGAL COUNSEL - P-I-C INVESTMENT TRUST
- --------------------------------------------------------------------------------
Shereff, Friedman, Hoffman & Goodman
LEGAL COUNSEL - P-I-C PORTFOLIOS
- --------------------------------------------------------------------------------
Heller, Ehrman, White & McAuliffe
INDEPENDENT AUDITORS
- --------------------------------------------------------------------------------
McGladrey & Pullen, LLP
This report is intended for the information of shareholders of P-I-C
Institutional Funds and should not be used as sales literature unless preceded
or accompanied by a current prospectus.
