<PAGE>
Message From The Investment Adviser Brenton Mutual Funds
- --------------------------------------------------------------------------------
Dear Shareholders:
The last year has truly been an extraordinary one, with dramatic gains in
common stock prices and stable to lower interest rates. Investor and consumer
confidence remains high with solid economic growth, little or no inflation, and
strong real income growth helping to fuel the party. Seven years of
uninterrupted economic growth has contributed to a strong turnaround in our
country's fiscal balance. It now appears we will see the first budget surplus
since 1969 and estimates range from $40 billion to $80 billion. As recently as
1992, the deficit was $290 billion. Perhaps more importantly, the economic
advance has been balanced and at this juncture there appears to be further
gains ahead.
Although conditions appear favorable for the foreseeable future, as always,
there are possible problems below the surface. Recession/Depression in Asia
increases the chances for an economic slow down worldwide and earnings
disappointments on a company specific basis. In addition, after seven years of
economic growth, most of the easy improvements in earnings have been realized
and double-digit earnings increases seem increasingly unlikely moving forward.
INTERMEDIATE U.S. GOVERNMENT SECURITIES FUND
Interest rates stayed in a fairly narrow range over the last six months with a
modest downward bias. The thirty-year treasury rate was 5.93% on March 31st
compared to 6.40% on September 30th. Signs of solid economic growth continue to
have little impact on interest rates as inflation trends lower. With positive
news on inflation, the federal budget surplus and economic growth, we look for
interest rates to continue to trade close to current levels over the next
several months. We have adopted a portfolio structure for the Fund with a
duration very close to the Merrill Lynch 3-7 year government index. As always,
we maintain excellent credit quality by limiting our investments to U.S.
Government or government agency securities.
On a longer-term basis, we continue to remain confident that we will sustain a
low inflation environment for the foreseeable future. That being the case, we
feel good about the prospect of achieving solid real or inflation adjusted
returns for shareholders.
[GRAPH APPEARS HERE]
Intermediate U.S. Government Securities Fund
Value of a $10,000 Investment
<TABLE>
<CAPTION>
Intermediate U.S. Government Intermediate U.S. Government Merrill Lynch
Securities Fund load* Securities Fund no load Government Index
<S> <C> <C> <C>
8/9/94 9,650 10,000 10,000
3/31/95 9,983 10,342 10,372
3/31/96 10,730 11,116 11,465
3/31/97 11,106 11,506 11,955
3/31/98 12,238 12,678 13,236
</TABLE>
Since
Inception
Date 1 Year (08/09/94)
03/31/98 6.34%* 5.70%*
*Reflects a 3.50% Sales Charge.
Past performance is not predictive of
future results.
The performance of the Brenton Intermediate U.S. Government Securities Fund is
measured against the Merrill Lynch 3-7 year Government Index, which is
generally representative of the performance of intermediate U.S. Government
securities. The index does not reflect the reduction of fees associated with a
mutual fund, such as investment management and fund accounting fees.
- --------------------------------------------------------------------------------
-1-
<PAGE>
Message From The Investment Adviser Brenton Mutual Funds
- -------------------------------------------------------------------------------
VALUE EQUITY FUND
We are generally pleased with the performance of the Fund over the last six
months. Despite the fact that our return (without load) of 13.63% trailed the
17.21% recorded by the Standard and Poor 500, we compared favorably with the
average return of growth funds followed by Lipper of 11.53%.
Investors continue to respond positively to the current environment of solid
economic growth, low and falling inflation rates, moderate earnings growth and
stable interest rates. The economic slowdown in Asia has had an effect on the
earnings of selected U.S. companies and has led to increased volatility in
stock prices. We see these fluctuations as an opportunity to acquire fine
companies at attractive prices. As always, we maintain our disciplined value
equity style while searching for new additions to the Fund.
Looking forward, we see an environment of solid but slowing economic growth
combined with low inflation and stable interest rates. We continue to avoid
new commitments to cyclical stocks and are focusing on firms positioned for
consistent growth. Over the last six months we have purchased a number of such
companies, including Burlington Resources, Mobil Corporation, Baker Hughes and
Tenet Healthcare.
Looking out longer term, we continue to stress themes related to demographics,
in particular the aging of the baby boom generation. We are confident that
these trends will continue and be particularly positive for financial stocks
as well as health care related firms.
[GRAPH APPEARS HERE]
Value Equity Fund
Value of a $10,000 Investment
<TABLE>
<CAPTION>
Equity Fund load* Equity Fund no load S&P 500 Index
<S> <C> <C> <C>
8/9/94 10,000 10,000 9,550
3/31/95 10,435 10,925 11,142
3/31/96 13,162 13,781 14,713
3/31/97 15,457 16,184 17,623
3/31/98 21,269 22,269 26,099
</TABLE>
Since
Date 1 Year Inception
(08/09/94)
03/31/98 31.38%* 23.01%*
* Reflects a 4.50% Sales Charge.
Past performance is not predictive of
future results.
The performance of the Brenton Value Equity Fund is measured against the
Standard & Poor's 500 Index, which is generally representative of the
performance of the stock market as a whole. The index does not reflect the
deduction of fees associated with a mutual fund, such as investment management
and fund accounting fees.
- -------------------------------------------------------------------------------
-2-
<PAGE>
Message From The Investment Adviser Brenton Mutual Funds
- -------------------------------------------------------------------------------
U.S. GOVERNMENT MONEY MARKET FUND(/1/)
The last six months have been a period of relative stability for short-term
interest rates as the Federal Reserve has held the fed funds rate steady at
5.50%. At this time we expect the federal funds rate will remain steady for
the next several months. That being the case, we expect to continue to focus
on maintaining high credit quality in the Fund while maintaining the average
maturity near current levels.
We appreciate the opportunity to serve your investment needs and will work
hard to continue to earn your confidence and support. If you have questions,
would like a prospectus or require any assistance, please contact your
investment representative or call 1-800-706-FUND.
Sincerely,
/s/ Douglas L. Brown
Douglas L. Brown
Vice President/Senior Portfolio Manager
FOR MORE COMPLETE INFORMATION ON ANY OF THE BRENTON MUTUAL FUNDS, INCLUDING
FEES, EXPENSES AND SALES CHARGES, PLEASE CALL 1-800-706-FUND FOR A FREE
PROSPECTUS. PLEASE READ THE PROSPECTUS CAREFULLY BEFORE INVESTING OR SENDING
MONEY.
THE INVESTMENT RETURN AND NET ASSET VALUE (NAV) WILL FLUCTUATE SO THAT AN
INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THE ORIGINAL
COST. THE COMPOSITION OF THE FUNDS' HOLDINGS IS SUBJECT TO CHANGE.
/1/An investment in the Fund is neither insured nor guaranteed by the U.S.
Government. Yields will fluctuate, and there can be no assurance that the Fund
will be able to maintain a stable Net Asset Value (NAV) of $1 per share.
SHARES OF THE FUNDS ARE NOT FDIC INSURED, NOR ARE THEY INSURED BY ANY
GOVERNMENT AGENCY. FUND SHARES ARE NOT DEPOSITS OR OTHER OBLIGATIONS OF, OR
GUARANTEED OR ENDORSED BY, BRENTON BANK OR ITS AFFILIATES. AN INVESTMENT IN
THE FUNDS INVOLVES INVESTMENT RISKS, INCLUDING THE POSSIBLE LOSS OF THE
PRINCIPAL AMOUNT INVESTED.
THE BRENTON MUTUAL FUNDS ARE A FAMILY OF MUTUAL FUNDS DISTRIBUTED BY BISYS
FUND SERVICES WHICH IS INDEPENDENT OF BRENTON BANK AND ITS AFFILIATES. BRENTON
BROKERAGE IS A REGISTERED BROKER-DEALER FROM WHOM SHARES OF THE BRENTON MUTUAL
FUNDS MAY BE PURCHASED.
- -------------------------------------------------------------------------------
-3-
<PAGE>
TABLE OF CONTENTS
Report of Independent Auditors
Page 5
Statements of Assets and Liabilities
Page 6
Statements of Operations
Page 7
Statements of Changes in Net Assets
Page 8
Schedules of Portfolio Investments
Page 10
Notes to Financial Statements
Page 14
Financial Highlights
Page 19
-4-
<PAGE>
Report of Independent Auditors Brenton Mutual Funds
- --------------------------------------------------------------------------------
To the Shareholders and Board of Trustees of
Brenton Mutual Funds of The Coventry Group
We have audited the accompanying statements of assets and liabilities,
including the portfolios of investments, of Brenton Mutual Funds (comprising,
respectively, Brenton U.S. Government Money Market Fund, Brenton Intermediate
U.S. Government Securities Fund, and Brenton Value Equity Fund) as of March 31,
1998, and the related statements of operations for the year then ended, the
statements of changes in net assets for each of the two years in the period
then ended, and the financial highlights for each of the periods indicated
therein. These financial statements and financial highlights are the
responsibility of the Funds' management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements and financial highlights. Our procedures included confirmation of
securities owned as of March 31, 1998, by correspondence with the custodian and
others. 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 each
of the respective portfolios constituting Brenton Mutual Funds as of March 31,
1998, the results of their operations for the year then ended, the changes in
their net assets for each of the two years in the period then ended, and their
financial highlights for each of the indicated periods, in conformity with
generally accepted accounting principles.
Ernst & Young LLP
Columbus, Ohio
May 1, 1998
- --------------------------------------------------------------------------------
-5-
<PAGE>
THE COVENTRY GROUP
BRENTON MUTUAL FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
MARCH 31, 1998
<TABLE>
<CAPTION>
INTERMEDIATE
U.S. GOVERNMENT U.S. GOVERNMENT
MONEY MARKET SECURITIES VALUE EQUITY
FUND FUND FUND
--------------- --------------- ------------
<S> <C> <C> <C>
ASSETS:
Investments, at value (cost
$45,295,830; $25,734,317;
$35,227,029, respectively)..... $45,295,830 $26,128,092 $57,000,086
Interest and dividends
receivable...................... 136,163 397,803 68,258
Prepaid expenses and other
assets......................... 21,267 6,190 15,299
----------- ----------- -----------
Total Assets................ 45,453,260 26,532,085 57,083,643
----------- ----------- -----------
LIABILITIES:
Dividends payable............... 175,394 160,464 67,288
Payable to brokers for
securities purchased........... 3,186,368 -- --
Accrued expenses and other
payables:
Investment advisory fees...... 9,492 12,752 33,203
Administration fees........... 870 359 1,550
Distribution and shareholder
service fees................. 999 812 2,519
Custodian, accounting and
transfer agent fees.......... 2,860 3,795 1,120
Legal and audit fees.......... 9,921 11,896 18,077
Printing fees................. 6,414 6,810 9,999
Other......................... 344 2,765 2,104
----------- ----------- -----------
Total Liabilities........... 3,392,662 199,653 135,860
----------- ----------- -----------
NET ASSETS:
Capital......................... 42,060,330 25,724,436 32,240,370
Undistributed (distribution in
excess of) net investment
income (loss).................. 626 21,102 (3,379)
Net unrealized appreciation
(depreciation) from
investments.................... -- 393,775 21,773,057
Accumulated undistributed net
realized gains (losses) from
investment transactions........ (358) 193,119 2,937,735
----------- ----------- -----------
Net Assets.................. 42,060,598 26,332,432 56,947,783
=========== =========== ===========
Outstanding units of beneficial
interest (shares).............. 42,060,016 2,555,646 2,875,310
=========== =========== ===========
Net asset value--redemption
price per share................ $1.00 $10.30 $19.81
=========== =========== ===========
Maximum Sales Charge............ -- 3.50% 4.50%
----------- ----------- -----------
Maximum Offering Price per share
(100%/(100%-Maximum Sales
Charge) of net asset value
adjusted to nearest cent)...... $1.00(a) $10.67 $20.74
=========== =========== ===========
</TABLE>
- ------
(a)Offering price and redemption price are the same for the Money Market Fund.
See notes to financial statements.
-6-
<PAGE>
THE COVENTRY GROUP
BRENTON MUTUAL FUNDS
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED MARCH 31, 1998
<TABLE>
<CAPTION>
INTERMEDIATE
U.S. GOVERNMENT U.S. GOVERNMENT
MONEY MARKET SECURITIES VALUE EQUITY
FUND FUND FUND
--------------- --------------- ------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest income................... $2,001,805 $2,212,499 $ --
Dividend income................... 4,597 78,014 919,370
---------- ---------- -----------
Total income.................... 2,006,402 2,290,513 919,370
---------- ---------- -----------
EXPENSES:
Investment advisory fees.......... 143,993 156,685 345,936
Administration fees............... 71,996 71,122 103,646
Distribution and shareholder
service fees...................... 179,990 177,804 259,112
Custodian fees.................... 13,870 8,030 10,169
Fund accounting fees.............. 30,364 33,158 32,690
Transfer agent fees............... 40,118 28,260 48,884
Trustees' fees.................... 1,694 2,190 2,842
Legal fees........................ 8,713 9,934 12,202
Audit fees........................ 5,260 9,122 16,395
Registration and filing fees...... 2,535 4,089 6,988
Printing fees..................... 8,439 9,083 13,918
Other............................. 1,782 1,593 2,011
---------- ---------- -----------
Total Expenses.................. 508,754 511,070 854,793
Less: Fee waivers and expense
reimbursements................... (250,092) (165,024) (233,202)
---------- ---------- -----------
Net expenses.................... 258,662 346,046 621,591
---------- ---------- -----------
Net Investment Income............. 1,747,740 1,944,467 297,779
---------- ---------- -----------
REALIZED/UNREALIZED GAINS (LOSSES)
FROM INVESTMENTS:
Net realized gains (losses) from
investment transactions.......... 8 295,619 4,467,710
Net change in unrealized
appreciation (depreciation) from
investments...................... -- 1,228,528 11,585,146
---------- ---------- -----------
Net realized/unrealized gains
(losses) from investments........ 8 1,524,147 16,052,856
---------- ---------- -----------
Change in net assets resulting
from operations.................. $1,747,748 $3,468,614 $16,350,635
========== ========== ===========
</TABLE>
See notes to financial statements.
-7-
<PAGE>
THE COVENTRY GROUP
BRENTON MUTUAL FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
U.S. GOVERNMENT MONEY INTERMEDIATE U.S. GOVERNMENT
MARKET FUND SECURITIES FUND
-------------------------- ------------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
MARCH 31, MARCH 31, MARCH 31, MARCH 31,
1998 1997 1998 1997
------------ ------------ -------------- --------------
<S> <C> <C> <C> <C>
FROM INVESTMENT
ACTIVITIES:
OPERATIONS:
Net investment income.. $ 1,747,740 $ 1,457,429 $ 1,944,467 $ 1,907,327
Net realized gains
(losses) from
investment
transactions.......... 8 30 295,619 25,161
Net change in
unrealized
appreciation
(depreciation) from
investments........... -- -- 1,228,528 (814,536)
------------ ------------ -------------- -------------
Change in net assets
resulting from
operations............. 1,747,748 1,457,459 3,468,614 1,117,952
------------ ------------ -------------- -------------
DISTRIBUTIONS TO
SHAREHOLDERS:
From net investment
income................ (1,747,740) (1,457,429) (1,961,357) (1,906,249)
In excess of net
investment income..... -- -- (19,724) --
Dividends to
shareholders from net
realized gains from
investment
transactions.......... -- -- (54,748) (25,161)
In excess of net
realized gains........ -- -- -- (6,612)
------------ ------------ -------------- -------------
Change in net assets
from shareholder
distributions.......... (1,747,740) (1,457,429) (2,035,829) (1,938,022)
------------ ------------ -------------- -------------
CAPITAL TRANSACTIONS:
Proceeds from shares
issued................ 105,475,648 89,015,767 7,155,148 9,073,851
Dividends reinvested... 280,061 177,120 550,903 430,122
Cost of shares
redeemed.............. (98,490,752) (89,833,623) (16,964,161) (8,916,346)
------------ ------------ -------------- -------------
Change in net assets
from capital share
transactions.......... 7,264,957 (640,736) (9,258,110) 587,627
------------ ------------ -------------- -------------
Change in net assets... 7,264,965 (640,706) (7,825,325) (232,443)
NET ASSETS:
Beginning of period.... 34,795,633 35,436,339 34,157,757 34,390,200
------------ ------------ -------------- -------------
End of period.......... $ 42,060,598 $ 34,795,633 $ 26,332,432 $34,157,757
============ ============ ============== =============
Accumulated
undistributed net
investment
income included in net
assets, end of year.... $ 626 $ 626 $ 21,102 $ 16,890
------------ ------------ -------------- -------------
SHARE TRANSACTIONS:
Issued................. 105,475,630 89,015,767 700,180 900,765
Reinvested............. 280,061 177,120 54,220 42,750
Redeemed............... (98,491,075) (89,833,639) (1,643,959) (888,437)
------------ ------------ -------------- -------------
Change in shares........ 7,264,616 (640,752) (889,559) 55,078
============ ============ ============== =============
</TABLE>
See notes to financial statements.
-8-
<PAGE>
THE COVENTRY GROUP
BRENTON MUTUAL FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
VALUE EQUITY FUND
-------------------------
YEAR ENDED YEAR ENDED
MARCH 31, MARCH 31,
1998 1997
------------ -----------
<S> <C> <C>
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income.............................. $ 297,779 $ 328,324
Net realized gains (losses) from investment
transactions...................................... 4,467,710 502,713
Net change in unrealized appreciation
(depreciation) from investments................... 11,585,146 5,121,200
------------ -----------
Change in net assets resulting from operations...... 16,350,635 5,952,237
------------ -----------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income......................... (291,610) (328,324)
In excess of net investment income................. (3,379) (6,955)
Dividends to shareholders from net realized gains
from
investment transactions........................... (1,209,608) (502,713)
In excess of net realized gains.................... -- (200,285)
------------ -----------
Change in net assets from shareholder distributions. (1,504,597) (1,038,277)
------------ -----------
CAPITAL TRANSACTIONS:
Proceeds from shares issued........................ 12,077,719 12,165,965
Dividends reinvested............................... 1,079,209 700,687
Cost of shares redeemed............................ (12,781,841) (8,406,836)
------------ -----------
Change in net assets from capital share
transactions...................................... 375,087 4,459,816
------------ -----------
Change in net assets............................... 15,221,125 9,373,776
NET ASSETS:
Beginning of period................................ 41,726,658 32,352,882
------------ -----------
End of period...................................... $ 56,947,783 $41,726,658
============ ===========
Accumulated undistributed (distribution in excess
of) net investment income included in net assets,
end of year........................................ $ (3,379) $ (6,169)
------------ -----------
SHARE TRANSACTIONS:
Issued............................................. 692,334 858,261
Reinvested......................................... 60,284 49,747
Redeemed........................................... (697,579) (586,543)
------------ -----------
Change in shares.................................... 55,039 321,465
============ ===========
</TABLE>
See notes to financial statements.
-9-
<PAGE>
THE COVENTRY GROUP
BRENTON U.S. GOVERNMENT MONEY MARKET FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
MARCH 31, 1998
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY AMORTIZED
AMOUNT DESCRIPTION COST
----------- ------------------------------------------------------ -----------
<C> <S> <C>
U.S. GOVERNMENT AGENCIES (107.7%):
Federal Farm Credit Bank:
$ 850,000 5.75%, 7/1/98......................................... $ 849,705
410,000 5.70%, 12/1/98........................................ 409,751
Federal Home Loan Bank:
10,888,000 5.86%*, 4/1/98........................................ 10,887,999
2,005,000 5.56%*, 4/7/98........................................ 2,003,145
1,100,000 5.49%*, 4/22/98....................................... 1,096,490
6,000,000 5.52%*, 4/24/98....................................... 5,978,944
3,200,000 5.50%*, 4/29/98....................................... 3,186,368
2,000,000 5.49%*, 5/1/98........................................ 1,990,936
1,000,000 5.47%*, 5/13/98....................................... 993,672
2,508,000 5.47%*, 5/15/98....................................... 2,491,363
6,466,000 5.48%*, 5/20/98....................................... 6,418,211
900,000 5.72%, 7/21/98........................................ 899,989
350,000 5.71%, 10/1/98........................................ 350,027
650,000 5.70%, 10/23/98....................................... 649,779
700,000 5.78%, 10/30/98....................................... 699,955
500,000 5.50%, 3/19/99........................................ 499,536
450,000 5.50%, 03/26/99....................................... 449,575
</TABLE>
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY AMORTIZED
AMOUNT DESCRIPTION COST
----------- ----------------------------------------------------- -----------
<C> <S> <C>
U.S. GOVERNMENT AGENCIES, CONTINUED:
Student Loan Marketing Association:
$ 640,000 5.85%, 6/10/98....................................... $ 639,832
500,000 5.86%, 6/10/98....................................... 499,906
900,000 5.79%, 9/16/98....................................... 899,711
1,400,000 5.82%, 9/16/98....................................... 1,400,382
250,000 5.72%, 11/20/98...................................... 249,934
250,000 5.72%, 11/20/98...................................... 249,893
1,500,000 5.74%, 12/17/98...................................... 1,498,931
-----------
Total U.S. Government Agencies 45,294,034
-----------
INVESTMENT COMPANIES:
1,796 Dreyfus Treasury Prime Money Market Portfolio........ 1,796
-----------
Total Investment Companies 1,796
-----------
Total (Cost--$45,295,830) (a) $45,295,830
===========
</TABLE>
- ------
*Effective yield at date of purchase.
Percentages indicated are based on net assets of $42,060,598.
(a) Cost and value for federal income tax and financial reporting purposes are
the same.
See notes to financial statements.
-10-
<PAGE>
THE COVENTRY GROUP
BRENTON INTERMEDIATE U.S. GOVERNMENT SECURITIES FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
MARCH 31, 1998
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
---------- ------------------------------------------------------- -----------
<C> <S> <C>
U.S. GOVERNMENT AGENCIES (84.1%):
Federal Home Loan Bank:
$1,000,000 5.97%, 11/8/99......................................... $ 1,002,950
2,000,000 6.50%, 06/5/02......................................... 2,048,540
1,000,000 6.89%, 4/6/04.......................................... 1,049,780
1,000,000 7.36%, 7/1/04.......................................... 1,075,080
1,000,000 7.32%, 4/21/05......................................... 1,075,810
3,000,000 6.32%, 06/28/05........................................ 3,057,750
1,000,000 6.15%, 11/28/05........................................ 1,010,190
Federal Home Loan Mortgage Corporation:
1,500,000 6.55%, 10/2/02......................................... 1,541,535
1,000,000 6.75%, 8/1/05.......................................... 1,045,020
1,042,743 6.50%, 7/1/08.......................................... 1,050,563
Federal National Mortgage Association:
1,500,000 6.40%, 10/24/02........................................ 1,507,605
1,500,000 6.74%, 7/9/07.......................................... 1,577,070
628,396 6.50%, 3/1/09.......................................... 633,109
</TABLE>
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
---------- ------------------------------------------------------ -----------
<C> <S> <C>
U.S. GOVERNMENT AGENCIES, CONTINUED:
Federal National Mortgage Association, continued:
$2,178,831 7.50%, 11/1/17........................................ $ 2,249,643
1,562,365 7.50%, 12/1/25........................................ 1,606,299
Government National Mortgage Association:
596,688 7.00%, 05/1/10........................................ 607,876
-----------
Total U.S. Government Agencies 22,138,820
-----------
U.S. TREASURY NOTES (11.5%):
1,000,000 6.38%, 1/15/00........................................ 1,012,390
2,000,000 5.88%, 9/30/02........................................ 2,013,240
-----------
Total U.S. Treasury Notes 3,025,630
-----------
INVESTMENT COMPANIES (3.7%):
963,642 Goldman Federal Portfolio Money Market Portfolio...... 963,642
-----------
Total Investment Companies 963,642
-----------
Total (Cost--$25,734,317) (a) $26,128,092
===========
</TABLE>
- ------
Percentages indicated are based on net assets of $26,332,432.
(a) Represents cost for federal income tax purposes and differs from market
value by net unrealized appreciation of securities as follows:
<TABLE>
<S> <C>
Unrealized appreciation..... $408,079
Unrealized depreciation..... (14,304)
--------
Net unrealized appreciation. $393,775
========
</TABLE>
See notes to financial statements.
-11-
<PAGE>
THE COVENTRY GROUP
BRENTON VALUE EQUITY FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
MARCH 31, 1998
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ------------------------------------------------------- -----------
<C> <S> <C>
COMMON STOCKS (99.0%):
Aerospace/Defense (0.9%):
11,000 General Motors Corp.--Class H.......................... $ 497,750
-----------
Auto Parts (1.1%):
12,000 TRW, Inc............................................... 661,500
-----------
Banks (8.4%):
14,850 Banc One Corp.......................................... 939,263
16,000 BankAmerica Corp....................................... 1,322,000
10,000 Chase Manhattan Corp................................... 1,348,749
3,500 Wells Fargo & Co....................................... 1,159,375
-----------
4,769,387
-----------
Beverages--Non-alcoholic (2.5%):
9,200 Coca-Cola Co........................................... 712,425
16,700 PepsiCo, Inc........................................... 712,881
-----------
1,425,306
-----------
Beverages--Wines & Spirits (1.4%):
17,400 Anheuser-Busch Cos., Inc............................... 805,838
-----------
Capital Equipment (2.3%):
20,000 Illinois Tool Works, Inc............................... 1,295,000
-----------
Chemicals--Diversified (1.0%):
8,600 Du Pont (E.I.) de Nemours & Co......................... 584,800
-----------
Chemicals--Specialty (1.4%):
21,000 Sigma-Aldrich Corp..................................... 782,250
-----------
Computer Software (1.7%):
21,000 Electronic Data Systems Corp........................... 963,375
-----------
Computers--Peripheral Equipment (0.4%):
11,000 Adaptec, Inc. (b)...................................... 215,875
-----------
Defense (1.8%):
18,186 Raytheon Co.--Class A.................................. 1,034,329
-----------
Diversified Operations (3.3%):
13,000 General Electric Co.................................... 1,120,437
8,100 Minnesota Mining & Manufacturing Co.................... 738,619
-----------
1,859,056
-----------
</TABLE>
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ------------------------------------------------------- -----------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
Electrical Equipment (3.0%):
18,000 AMP, Inc............................................... $ 788,625
14,000 Emerson Electric Co.................................... 912,625
-----------
1,701,250
-----------
Electronic Components (2.4%):
12,000 Intel Corp............................................. 936,750
7,000 Motorola, Inc.......................................... 424,375
-----------
1,361,125
-----------
Energy (1.5%):
22,500 Xilinx, Inc. (b)....................................... 842,344
-----------
Financial Services (3.3%):
15,000 Federal Home Loan Mortgage Corp........................ 711,563
17,800 MGIC Investment Corp................................... 1,169,237
-----------
1,880,800
-----------
Food Products & Services (3.8%):
31,200 ConAgra, Inc........................................... 1,002,300
19,300 Sara Lee Corp.......................................... 1,189,363
-----------
2,191,663
-----------
Health Care--Drugs (5.4%):
9,000 American Home Products Corp............................ 858,375
15,000 Bristol Myers Squibb Co................................ 1,564,688
5,000 Merck & Co., Inc....................................... 641,875
-----------
3,064,938
-----------
Health Care--General Products (1.9%):
15,100 Johnson & Johnson...................................... 1,107,019
-----------
Household--General Products (3.5%):
20,000 Newell Co.............................................. 968,750
12,000 Procter & Gamble Co.................................... 1,012,500
-----------
1,981,250
-----------
Insurance (6.7%):
7,000 Loews Corp............................................. 729,750
21,000 Reliastar Financial Corp............................... 967,313
19,300 Safeco Corp............................................ 1,054,865
19,200 UNUM Corp.............................................. 1,059,599
-----------
3,811,527
-----------
</TABLE>
Continued
-12-
<PAGE>
THE COVENTRY GROUP
BRENTON VALUE EQUITY FUND
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
MARCH 31, 1998
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ------------------------------------------------------- -----------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
Leisure & Recreation (1.5%):
25,000 Brunswick Corp......................................... $ 871,875
-----------
Medical-Hospital Management & Services (1.3%):
20,000 Tenet Healthcare Corp. (b)............................. 726,250
-----------
Natural Gas Utility (1.0%):
15,000 Baker Hughes, Inc...................................... 603,750
-----------
Office Supplies, Automation & Equipment (3.1%):
16,500 Avery Dennison......................................... 880,688
18,000 Pitney Bowes, Inc...................................... 903,375
-----------
1,784,063
-----------
Oil & Gas (1.7%):
20,000 Burlington Resources, Inc.............................. 958,750
-----------
Oil Companies--Integrated (5.0%):
8,800 Amoco Corp............................................. 760,100
12,800 Exxon Corp............................................. 865,600
16,000 Mobil Corp............................................. 1,226,000
-----------
2,851,700
-----------
Oil Field Services (2.1%):
16,000 Schlumberger Ltd....................................... 1,212,000
-----------
Paint & Related Products (1.9%):
29,800 Sherwin-Williams Co.................................... 1,057,900
-----------
Paper & Related Products (1.6%):
18,800 Kimberly-Clark Corp.................................... 942,350
-----------
Restaurants (1.6%):
15,000 McDonald's Corp........................................ 900,000
-----------
Retail--Convenience Stores (1.7%):
60,000 Casey's General Stores, Inc............................ 960,000
-----------
Retail--General Merchandise (2.1%):
22,000 Costco Cos., Inc. (b).................................. 1,177,000
-----------
</TABLE>
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ------------------------------------------------------- -----------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
Retail--Specialty Stores (1.2%):
10,500 Home Depot, Inc........................................ $ 708,094
-----------
Tobacco (1.5%):
20,300 Philip Morris Cos., Inc................................ 846,256
-----------
Utilities--Electric (4.1%):
15,000 AES Corp............................................... 786,563
19,000 Boston Edison Co....................................... 796,812
26,000 Houston Industries, Inc................................ 747,500
-----------
2,330,875
-----------
Utilities--Gas & Pipeline (1.2%):
15,300 Sonat, Inc............................................. 665,550
-----------
Utilities--Telephone (5.9%):
10,000 AT&T Corp.............................................. 656,250
14,800 GTE Corp............................................... 886,150
19,800 SBC Communications, Inc................................ 863,775
22,000 WorldCom, Inc. (b)..................................... 947,375
-----------
3,353,550
-----------
Wholesale (2.8%):
26,000 Arrow Electronics, Inc. (b)............................ 703,625
34,000 Sysco Corp............................................. 871,250
-----------
1,574,875
-----------
Total Common Stocks 56,361,220
-----------
INVESTMENT COMPANIES (1.1%):
638,866 Goldman Federal Money Market Portfolio................. 638,866
-----------
Total Investment Companies 638,866
-----------
Total (Cost--$35,227,029) (a) $57,000,086
===========
</TABLE>
- ------
Percentages indicated are based on net assets of $56,947,783.
(a) Represents cost for federal income tax purposes and differs from market
value by net unrealized appreciation of securities as follows:
<TABLE>
<S> <C>
Unrealized appreciation... $22,054,433
Unrealized depreciation... (281,376)
-----------
Net unrealized apprecia-
tion..................... $21,773,057
===========
</TABLE>
(b) Represents non-income producing securities.
See notes to financial statements.
-13-
<PAGE>
THE COVENTRY GROUP
BRENTON MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1998
1. ORGANIZATION:
The Coventry Group (the "Group") was organized on January 8, 1992 as a
Massachusetts business trust, and is registered under the Investment Company
Act of 1940, as amended (the "1940 Act"), as a diversified, open-end
management investment company. Between the date of organization and the date
of commencement of operations of the Brenton U.S. Government Money Market
Fund, the Brenton Intermediate U.S. Government Securities Fund, and the
Brenton Value Equity Fund, (individually, a "Fund"; collectively, the
"Funds"), a series of the Group, the Funds earned no investment income and
had no operations other than incurring organizational expenses.
The Brenton U.S. Government Money Market Fund's investment objective is to
seek current income consistent with maintaining liquidity and stability of
principal. The Fund invests exclusively in short-term U.S. Treasury bills
and notes and other short-term obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities ("U.S. Government
Obligations"). The investment objective of the Brenton Intermediate U. S.
Government Securities Fund is to seek total return consistent with the
production of current income and the preservation of capital. The Fund
invests primarily in U.S. Government Obligations and intends to maintain a
dollar-weighted average portfolio maturity of 3 to 10 years. The investment
objective of the Brenton Value Equity Fund is long-term capital
appreciation. The Fund invests primarily in a diversified portfolio of
equity securities.
The Group is authorized to issue an unlimited number of shares which are
equal units of beneficial interest with a par value of $0.01 per share.
Sales of Fund shares may be made to the general public.
2. SIGNIFICANT ACCOUNTING PRINCIPLES:
The following is a summary of significant accounting policies followed by
the Funds in the preparation of their financial statements. The policies are
in conformity with generally accepted accounting principles. The preparation
of financial statements requires management to make estimates and
assumptions that affect the reported amounts and disclosures. Actual amounts
could differ from those estimates.
SECURITIES VALUATION:
Investments of the Brenton U.S. Government Money Market Fund are valued
at either amortized cost, which approximates market value, or at original
cost which when combined with accrued interest approximates market value.
Under the amortized cost valuation method, discount or premium is
amortized on a constant basis to the maturity of the security. In
addition, the Brenton U.S. Government Money Market Fund may not (a)
purchase any instrument with a remaining maturity greater than thirteen
months unless such investment is subject to a demand feature, or (b)
maintain a dollar-weighted-average portfolio maturity which exceeds 90
days.
Continued
-14-
<PAGE>
THE COVENTRY GROUP
BRENTON MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS, CONTINUED
MARCH 31, 1998
Investments in common and preferred stocks, commercial paper, corporate
bonds, municipal bonds, U.S. Government securities and U.S. Government
agency securities of the Brenton Intermediate U.S. Government Securities
Fund and the Brenton Value Equity Fund (collectively "the variable net
asset value funds") are valued at their market values determined on the
basis of the latest available bid quotation in the principal market
(closing sales prices if the principal market is an exchange) in which
such securities are normally traded. Investments in investment companies
are valued at their respective net asset values as reported by such
companies. Securities, including restricted securities, for which market
quotations are not readily available, are valued at fair market value or
as determined in good faith by the investment adviser under the
supervision of the Group's Board of Trustees. The difference between the
cost and market values of investments held by the variable net asset
value funds is reflected as either unrealized appreciation or
depreciation.
SECURITY TRANSACTIONS AND RELATED INCOME:
Security transactions are accounted for on the date the security is
purchased or sold (trade date). Interest income is recognized on the
accrual basis and includes, where applicable, the pro rata amortization
of premium or discount. Dividend income is recorded on the ex-dividend
date. Gains or losses realized on sales of securities are determined by
comparing the identified cost of the security lot sold with the net sales
proceeds.
REPURCHASE AGREEMENTS:
The Funds may acquire repurchase agreements from financial institutions
such as bank, brokers, or dealers that the investment adviser deems
creditworthy under guidelines approved by the Group's Board of Trustees,
subject to the seller's agreement to repurchase such securities at a
mutually agreed-upon date and price. The repurchase price generally
equals the price paid by a Fund plus interest negotiated on the basis of
current short-term rates, which may be more or less than the rate on the
underlying portfolio securities. The seller, under an agreement to
repurchase, is required to maintain with the Fund's custodian, another
qualified custodian or in the Federal Reserve/Treasury book-entry system
the value of collateral held pursuant to the agreement at not less than
the repurchase price (including accrued interest). Repurchase agreements
are considered to be loans by a Fund under the 1940 Act.
DIVIDENDS TO SHAREHOLDERS:
Dividends from net investment income are declared daily and paid monthly
for the U.S. Government Money Market Fund. Dividends from net investment
income are declared and paid monthly for the Intermediate U.S. Government
Securities Fund. Dividends from net investment income are declared and
paid quarterly for the Value Equity Fund. Distributable net realized
capital gains, if any, are declared and distributed at least annually for
each Fund.
Continued
-15-
<PAGE>
THE COVENTRY GROUP
BRENTON MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS, CONTINUED
MARCH 31, 1998
Dividends from net investment income and from net realized capital gains
are determined in accordance with income tax regulations which may differ
from generally accepted accounting principles. These differences are
primarily due to expiring capital loss carry forwards and deferrals of
certain losses.
FEDERAL INCOME TAXES:
It is the policy of each of the Funds to qualify as a regulated
investment company by complying with the provisions available to certain
investment companies, as defined in applicable sections of the Internal
Revenue Code, and to make distributions of net investment income and net
realized capital gains sufficient to relieve each of the Funds from all,
or substantially all, federal income taxes. At March 31, 1998 the
following fund had capital loss carryforwards which are available to
offset future capital gains, if any.
<TABLE>
<CAPTION>
CAPITAL LOSS
CARRYFORWARD EXPIRES
------------ -------
<S> <C> <C>
U.S. Government Money Market Fund...................... $353 2005
U.S. Government Money Market Fund...................... 5 2006
</TABLE>
EXPENSES:
Expenses that are directly related to one of the Funds are charged
directly to that Fund. Expenses relating to the Funds collectively are
prorated to the Funds on the basis of each Fund's relative net assets.
Other expenses for the Group are prorated to the Funds and any other
portfolios of the Group on the basis of relative net assets.
3. PURCHASES AND SALES OF SECURITIES:
Purchases and sales of securities (excluding short-term securities) for the
year ended March 31, 1998 are as follows:
<TABLE>
<CAPTION>
PROCEEDS
PURCHASES FROM SALES
----------- -----------
<S> <C> <C>
Intermediate U.S. Government Securities Fund......... $20,153,300 $28,768,471
Value Equity Fund.................................... 16,562,070 16,594,424
</TABLE>
Continued
-16-
<PAGE>
THE COVENTRY GROUP
BRENTON MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS, CONTINUED
MARCH 31, 1998
4. RELATED PARTY TRANSACTIONS:
Investment advisory services are provided to the Group by Brenton Bank.
Under the terms of the investment advisory agreement, Brenton Bank is
entitled to receive fees computed daily based on a percentage of the average
net assets of each Fund. Brenton Bank also serves as custodian to the Funds.
The Northern Trust Company serves as sub-investment adviser to the U.S.
Government Money Market Fund. For such services, Brenton Bank (not the Fund)
pays the Northern Trust Company an annual fee of 0.08% of the U.S.
Government Money Market Fund's average daily net assets.
BISYS Fund Services Limited Partnership d/b/a BISYS Fund Services ("BISYS"),
an Ohio Limited Partnership, and BISYS Fund Services Ohio, Inc. ("BISYS
Ohio") are subsidiaries of the BISYS Group, Inc. BISYS, with whom certain
officers and trustees of the Group are affiliated, serves the Funds as
administrator. Such officers and trustees are paid no fees directly by the
Funds for serving as officers and trustees of the Group. Under the terms of
the administration agreement, BISYS' fees are computed daily as a percentage
of the average net assets of each of the Funds.
BISYS Ohio serves as transfer agent to the Funds. Under the terms of the
transfer agency agreement, BISYS Ohio is entitled to receive fees based upon
a specified amount per shareholder with specified minimum per portfolio
amounts and surcharges, plus certain out-of-pocket expenses. BISYS Ohio also
serves as fund accountant. Under the terms of the fund accounting agreement,
BISYS Ohio receives fees monthly at an annual rate of $30,000 for the U.S.
Government Money Market Fund, the Intermediate U.S. Government Securities
Fund, and the Value Equity Fund, plus certain out-of-pocket expenses.
The Funds have adopted a Distribution and Shareholder Services Plan in
accordance with Rule 12b-1 under the Investment Company Act of 1940,
pursuant to which the Funds are authorized to pay or reimburse BISYS, as
distributor, a periodic amount, calculated at an annual rate not to exceed
.50% of the average daily net asset value of the Funds. These fees are used
by BISYS to pay banks, including Brenton Bank, brokers, dealers and other
institutions, or to reimburse BISYS or its affiliates, for administration,
distribution and shareholder services in connection with the distribution of
Fund shares.
Continued
-17-
<PAGE>
THE COVENTRY GROUP
BRENTON MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS, CONTINUED
MARCH 31, 1998
Fees may be voluntarily reduced to assist the Funds in maintaining
competitive expense ratios. Information regarding these transactions is as
follows for the year ended March 31, 1998:
<TABLE>
<CAPTION>
U.S. INTERMEDIATE
GOVERNMENT U.S.
MONEY GOVERNMENT VALUE
MARKET SECURITIES EQUITY
FUND FUND FUND
---------- ------------ --------
<S> <C> <C> <C>
INVESTMENT ADVISOR FEES:
Annual fee before
voluntary fee
reductions
(percentage of average
net assets)............ 0.40% 0.44% 0.67%
Voluntary fee
reductions............. $ 85,936 NA NA
ADMINISTRATION FEES:
Annual fee before
voluntary fee
reductions
(percentage of average
net assets)............ 0.20% 0.20% 0.20%
Voluntary fee
reductions............. $1,353 $4,394 --
12B-1 FEES:
Annual fee before
voluntary fee
reductions
(percentage of average
net assets)............ 0.50% 0.50% 0.50%
Voluntary fee
reductions............. $162,803 $160,630 $233,202
CUSTODIAN AND ACCOUNTING
FEES:.................. $ 44,234 $ 41,188 $ 42,859
TRANSFER AGENT FEES:.... $ 40,118 $ 28,260 $ 48,884
</TABLE>
5.FEDERAL INCOME TAX INFORMATION (UNAUDITED):
During the year ended March 31, 1998, the following Fund declared long-term
capital gain distributions in the following amount:
<TABLE>
<CAPTION>
FUND AMOUNT
---- ----------
<S> <C>
Value Equity Fund.................................................. $1,209,608
</TABLE>
For the taxable year ended March 31, 1998, 75.09% of income dividends paid
by the Brenton Value Equity Fund qualify for the dividends received
deduction available to corporations.
-18-
<PAGE>
THE COVENTRY GROUP
BRENTON MUTUAL FUNDS
FINANCIAL HIGHLIGHTS
Selected data for a share of beneficial interest outstanding throughout the
period indicated:
<TABLE>
<CAPTION>
U.S. GOVERNMENT
MONEY MARKET FUND
---------------------------------------
YEAR YEAR YEAR AUGUST 9,
ENDED ENDED ENDED 1994 TO
MARCH 31, MARCH 31, MARCH 31, MARCH 31,
1998 1997 1996 1995 (A)
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF
PERIOD............................. $ 1.000 $ 1.000 $ 1.000 $ 1.000
------- ------- ------- -------
INVESTMENT ACTIVITIES
Net investment income.............. 0.048 0.046 0.050 0.028
------- ------- ------- -------
Total from Investment Activities.. 0.048 0.046 0.050 0.028
------- ------- ------- -------
DISTRIBUTIONS
Net investment income.............. (0.048) (0.046) (0.050) (0.028)
------- ------- ------- -------
Total Distributions............... (0.048) (0.046) (0.050) (0.028)
------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD...... $ 1.000 $ 1.000 $ 1.000 $ 1.000
======= ======= ======= =======
Total return (excludes sales
charge).......................... 4.96% 4.67% 5.12% 2.84%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets, End of Period (000).... $42,061 $34,796 $35,436 $27,810
Ratio of expenses to average net
assets............................ 0.72% 0.77% 0.75% 0.97%(c)
Ratio of net investment income to
average net assets................ 4.86% 4.57% 4.99% 4.37%(c)
Ratio of expenses to average net
assets (*)........................ 1.41% 1.47% 1.46% 1.66%(c)
Ratio of net investment income to
average net assets (*)............ 4.16% 3.87% 4.28% 3.68%(c)
</TABLE>
- --------
* During the period, certain fees were voluntarily reduced and/or reimbursed.
If such voluntary fee reductions had not occurred, the ratios would have
been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
See notes to financial statements.
-19-
<PAGE>
THE COVENTRY GROUP
BRENTON MUTUAL FUNDS
FINANCIAL HIGHLIGHTS
Selected data for a share of beneficial interest outstanding throughout the
period indicated:
<TABLE>
<CAPTION>
INTERMEDIATE U.S. GOVERNMENT
SECURITIES FUND
---------------------------------------
YEAR YEAR YEAR AUGUST 9,
ENDED ENDED ENDED 1994 TO
MARCH 31, MARCH 31, MARCH 31, MARCH 31,
1998 1997 1996 1995 (A)
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF
PERIOD............................. $ 9.91 $ 10.14 $ 9.99 $ 10.00
------- ------- ------- -------
INVESTMENT ACTIVITIES
Net investment income.............. 0.59 0.57 0.59 0.35
Net realized and unrealized gains
(losses) from investments......... 0.40 (0.22) 0.15 (0.02)
------- ------- ------- -------
Total from Investment
Activities..................... 0.99 0.35 0.74 0.33
------- ------- ------- -------
DISTRIBUTIONS
Net investment income.............. (0.58) (0.57) (0.59) (0.34)
Net realized gains from
investments....................... (0.02) (0.01) -- --
------- ------- ------- -------
Total Distributions............... (0.60) (0.58) (0.59) (0.34)
------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD...... $ 10.30 $ 9.91 $ 10.14 $ 9.99
======= ======= ======= =======
Total return (excludes sales
charge).......................... 10.21% 3.51% 7.48% 3.42%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets, End of Period (000).... $26,332 $34,158 $34,390 $16,438
Ratio of expenses to average net
assets............................ 0.97% 1.02% 1.07% 1.53%(c)
Ratio of net investment income to
average net assets................ 5.47% 5.64% 5.82% 5.71%(c)
Ratio of expenses to average net
assets (*)........................ 1.42% 1.47% 1.55% 2.03%(c)
Ratio of net investment income to
average net assets (*)............ 5.02% 5.19% 5.34% 5.21%(c)
Portfolio Turnover................. 61.25% 78.95% 30.85% 20.69%
</TABLE>
- --------
* During the period, certain fees were voluntarily reduced and/or reimbursed.
If such voluntary fee reductions had not occurred, the ratios would have
been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
See notes to financial statements.
-20-
<PAGE>
THE COVENTRY GROUP
BRENTON MUTUAL FUNDS
FINANCIAL HIGHLIGHTS
Selected data for a share of beneficial interest outstanding throughout the
period indicated:
<TABLE>
<CAPTION>
VALUE EQUITY
FUND
---------------------------------------
YEAR YEAR YEAR AUGUST 9,
ENDED ENDED ENDED 1994 TO
MARCH 31, MARCH 31, MARCH 31, MARCH 31,
1998 1997 1996 1995 (A)
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF
PERIOD............................. $ 14.80 $ 12.95 $ 10.83 $ 10.00
------- ------- ------- -------
INVESTMENT ACTIVITIES
Net investment income.............. 0.10 0.13 0.10 0.09
Net realized and unrealized gains
(losses) from investments......... 5.41 2.11 2.70 0.83
------- ------- ------- -------
Total from Investment Activities.. 5.51 2.24 2.80 0.92
------- ------- ------- -------
DISTRIBUTIONS
Net investment income.............. (0.10) (0.13) (0.10) (0.09)
Net realized gains from
investments....................... (0.40) (0.19) (0.58) --
In excess of net realized gains
from investments.................. -- (0.07) -- --
------- ------- ------- -------
Total Distributions............... (0.50) (0.39) (0.68) (0.09)
------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD...... $ 19.81 $ 14.80 $ 12.95 $ 10.83
======= ======= ======= =======
Total return (excludes sales
charges)......................... 37.59% 17.44% 26.13% 9.25%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets, End of Period (000).... $56,948 $41,727 $32,353 $15,628
Ratio of expenses to average net
assets............................ 1.20% 1.28% 1.45% 1.80%(c)
Ratio of net investment income to
average net assets................ 0.57% 0.88% 0.83% 1.39%(c)
Ratio of expenses to average net
assets (*)........................ 1.65% 1.73% 1.92% 2.30%(c)
Ratio of net investment income to
average net assets (*)............ 0.12% 0.43% 0.36% 0.89%(c)
Portfolio Turnover................. 33.20% 17.15% 43.80% 18.30%
Average commission rate paid (d)... $0.0801 0.0824 -- --
</TABLE>
- --------
* During the period, certain fees were voluntarily reduced and/or
reimbursed. If such voluntary fee reductions had not occurred, the ratios
would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Represents the total dollar amount of commissions paid on portfolio
transactions divided by total number of portfolio shares purchased and
sold for which commissions were charged. Disclosure is not required for
periods prior to the year ended March 31, 1997.
See notes to financial statements.
-21-
<PAGE>
INVESTMENT ADVISER
Brenton Bank
2840 Ingersoll
Des Moines, Iowa 50312
ADMINISTRATOR AND DISTRIBUTOR
BISYS Fund Services
3435 Stelzer Road
Columbus, Ohio 43219
LEGAL COUNSEL
Dechert Price & Rhoads
1775 Eye Street, N.W.
Washington, D.C. 20006
AUDITORS
Ernst & Young LLP
10 West Broad Street
Suite 2300
Columbus, Ohio 43215
5/98
LOGO
BRENTON
MUTUAL FUNDS
LOGO
BRENTON BANK
INVESTMENT ADVISER
ANNUAL REPORT
TO
SHAREHOLDERS
MARCH 31, 1998
