<PAGE>
- ----------------------------------------------------------
COLONIAL U.S. GROWTH & INCOME FUND SEMIANNUAL REPORT
- ----------------------------------------------------------
December 31, 1998
-------------------------------
Not FDIC May Lose Value
Insured No Bank Guarantee
-------------------------------
<PAGE>
COLONIAL U.S. GROWTH & INCOME FUND HIGHLIGHTS
JULY 1, 1998 - DECEMBER 31, 1998
INVESTMENT OBJECTIVE: Colonial U.S. Growth & Income Fund seeks long-term growth
and income.
THE FUND IS DESIGNED TO OFFER:
|X| Long-term growth potential
|X| Disciplined value investment strategy
|X| Expert portfolio management
PORTFOLIO MANAGER COMMENTARY: "The Fund benefited from the overall market
strength of U.S. large-capitalization stocks during the period. Broad
diversification among industry sectors, along with individual stock selection in
telecommunications, consumer staples and technology, enabled it to outperform
the Lipper Growth & Income Funds category average."1
-- Mark Stoeckle
COLONIAL U.S. GROWTH & INCOME FUND PERFORMANCE
CLASS A CLASS B CLASS C
- --------------------------------------------------------------------------------
Inception dates 7/1/92 7/1/92 7/1/94
- --------------------------------------------------------------------------------
Six-month distributions
declared per share $0.870 $0.870 $0.870
- --------------------------------------------------------------------------------
Six-month total returns, assuming 4.52% 4.14% 4.07%
reinvestment of all distributions and
no sales charge or contingent deferred
sales charge (CDSC)
- --------------------------------------------------------------------------------
Net asset value per share on 12/31/98 $20.03 $19.60 $19.69
- --------------------------------------------------------------------------------
TOP FIVE HOLDINGS2 TOP FIVE SECTORS2
(as of 12/31/98) (as of 12/31/98)
- ----------------------------------- -----------------------------------
1 Microsoft Corp. .......... 3.1% 1 Financials ............... 18.9%
2 Intel Corp. .............. 2.7% 2 Technologies ............. 17.4%
3 Philip Morris Cos. Inc. .. 2.5% 3 Consumer Cyclicals ....... 11.3%
4 MCI WorldCom Inc. ........ 2.1% 4 Health Care .............. 11.0%
5 General Electric Co. ..... 2.1% 5 Utilities ................ 10.8%
1 Please see page four for complete Lipper rankings.
2 Holdings and sector breakdowns are calculated as a percentage of total net
assets. Because the Fund is actively managed, holdings and sector weightings
will change. Industry sectors in the following financial statements are based
upon the standard industrial classifications (SIC) published by the U.S.
Office of Management and Budget. The sector classifications on this page are
based upon Colonial's defined criteria as used in the investment process.
<PAGE>
PRESIDENT'S MESSAGE
TO FUND SHAREHOLDERS
[Photo of Stephen E. Gibson]
I am pleased to present the semiannual report for Colonial U.S. Growth & Income
Fund, formerly Colonial U.S. Stock Fund, for the six months ended December 31,
1998.
Investors witnessed dramatic swings in stock prices during the second half of
1998. Following a market peak in mid-July, troubles in Russia -- most notably
the devalued currency -- helped trigger a dramatic correction in U.S. stock
prices that continued through the third quarter. In response to fears of a
global economic slowdown, the Federal Reserve announced a series of interest
rate cuts. With renewed investor confidence, the market turned around early in
the fourth quarter and kept climbing through year end. As 1998 came to a close,
the S&P 500 Index achieved double-digit gains for a record-setting fourth year
in a row.
Returns for the six-month period were impressive, but they were not consistent
throughout the market. Large-company stocks outperformed the market as a whole,
with the very largest companies driving the returns of the S&P 500. With its
large-cap bias and value-driven management style, the Fund's returns exceeded
those of the Lipper Growth & Income Funds category average.(1)
Our portfolio managers actively search out holdings with attractive valuations,
strong past performance and future upside growth potential. The Fund's managers
are committed to maintaining diversification across a variety of industries
rather than making bets on what is hot at the moment. This disciplined process
enables the Fund to stay consistent with its objective of long-term growth,
while avoiding excessive risk.
The following report will provide you with more specific information on your
Fund's performance and the market in which the Fund invests. Thank you for
choosing Colonial U.S. Growth & Income Fund and for giving us the opportunity to
serve your investment needs.
Respectfully,
/s/ Stephen E. Gibson
Stephen E. Gibson
President
February 11, 1999
(1) Please see page four for complete Lipper rankings.
Because market and economic conditions change, there can be no assurance that
the trends discussed above or on the following pages will continue.
<PAGE>
PORTFOLIO MANAGEMENT REPORT
MARK STOECKLE is portfolio manager of Colonial U.S. Growth & Income Fund and is
vice president of Colonial Management Associates, Inc. The following is a
discussion of the Fund's performance for the six-month period ended December 31,
1998.
MARKET DOMINANCE OF LARGE-CAPITALIZATION STOCKS CONTINUES
The six-month period continued a theme that has defined the market for several
years -- large-capitalization stocks outperformed small- and medium-cap stocks,
and the largest of the large performed the best. During the six months ended
December 31, 1998, much of the 9.24% total return in the S&P 500 Index, a proxy
for large-company U.S. stocks, can be attributed to the 20 largest companies.
Fourteen of these companies were either underweighted or not in the portfolio
because several appeared overpriced and did not meet our value-driven criteria.
While this environment created a challenge in outperforming the S&P 500 Index,
the Fund did perform well during the period, achieving success within the
parameters of its value orientation.
We see three reasons for the dominance of large-company stocks. First, amid an
uncertain global economic environment, investors have preferred the stability
and liquidity of large-company stocks. Second, consumers have invested heavily
in index-weighted portfolios, skewing demand to the larger companies. And third,
foreign investors, who now hold a fairly significant share of the U.S. market,
favor the large-company names they recognize.
BROAD DIVERSIFICATION AND SEARCH FOR VALUE REWARDED INVESTORS
For the six-month period, the Fund generated a total return of 4.52% for Class A
shares, based on net asset value. This compares favorably with the performance
of the Lipper Growth & Income Funds category, which averaged 3.09% during the
period.(1)
The Fund's strategy is to be well diversified among sectors -- much more so than
traditional large-cap value funds, which often concentrate on a narrow selection
of undervalued industries. The Fund looks at the value of a stock relative to
its industry sector, not to the market as a whole. One of the many value
measures we consider is a company's price-to-earnings ratio (P/E ratio), which
looks at a company's stock price relative to its annualized earnings per share.
In general, the lower a stock's P/E ratio is relative to its peers, the "less
expensive" the stock is to buy. The Fund had a P/E ratio of 24, compared to 29
for the S&P 500 Index (as of 12/31/98).
At first glance, some of the holdings in this portfolio may appear to be growth
stocks. However, we believe these stocks are good values because of their
attractive prices relative to other stocks in the same industry and because they
have delivered consistent earnings. Technology holdings such as Microsoft (3.1%
of net assets) are consistent with fund objectives, notwithstanding their
popularity among investors.
SEVERAL INDUSTRY SECTORS POST IMPRESSIVE RETURNS
The Fund benefited from strong sector performance in several areas, especially
telecommunications, consumer staples and technology, during this period.
Telecommunications stocks, including BellSouth (1.2% of net assets), MCI
WorldCom, Inc. (2.1%), Ameritech (1.1%) and US West (1.0%), climbed
significantly. Such stocks appear low in price in relation to their earnings and
therefore conform to the Fund's value orientation. This sector is sensitive to
interest rates, and as rates came down, the stocks' values went up. Merger
activity also helped boost the returns of telecommunications stocks.
The Fund's success in the consumer staples sector was due to strong individual
stock selection. Philip Morris (2.5% of net assets) stock climbed as Congress
developed a framework for agreement on Medicare-related legal liability and
because of prospects for a stock buyback. Safeway (1.0%), an undervalued stock,
grew through acquisitions and consistently delivered earnings.
The technology sector has remained strong, as corporate leaders see that
advances in automation can give their companies a competitive edge. Their
financial commitment to adopting computer advances, coupled with household
computer purchases, continues to build investor confidence in technology stocks.
Sun MicroSystems (1.0% of net assets), Intel (2.7%), EMC Corp. (0.6%) and Compaq
Computer (1.3%) all benefited from such expenditures and contributed noticeably
to the Fund's success.
On the other hand, the financial and energy sectors underperformed the overall
market. American Express (0.9% of net assets) and Morgan Stanley Dean Witter
(0.8%) were hurt by their exposure to emerging market debt. Stocks in the energy
sector were adversely affected by falling oil prices.
PROSPECTS APPEAR FAVORABLE FOR LARGE-CAP VALUE STOCKS
We remain optimistic about the outlook for large-company stocks. While economic
growth may slow in the coming year, the Federal Reserve Board has proven itself
willing to adjust interest rates in response to threats of recession. Because
the Fund holds only domestic companies, its direct exposure to the economic woes
of foreign countries is limited (though these problems may affect the large
multinationals to some degree).
Corporate management teams are optimistic about the first half of 1999. They
have pulled back from businesses outside their strongest competencies and have
installed new technologies to obtain management information on a more timely
basis. Strict cost control is also improving the bottom line.
1 Source: Lipper, Inc. Lipper rankings are based on the Lipper Growth & Income
Funds category. The Fund's Class A share ranking is in the second quartile for
the 6-month period (ranked 366th out of 851 funds); in the second quartile for
the 1-year period (ranked 265th out of 768 funds); and in the second quartile
for the 5-year period (ranked 96th out of 311 funds). Rankings do not include
any sales charges. Performance for different share classes will vary with fees
associated with each class. Past performance cannot guarantee future results.
<PAGE>
COLONIAL U.S. GROWTH & INCOME FUND INVESTMENT PERFORMANCE VS. THE S&P 500 INDEX
Change in Value of $10,000 from 7/1/92 - 12/31/98
Based on NAV and POP for Class A Shares
S&P 500 NAV POP
------- --- ---
Jun 30, 92 $10,000 $10,000 $10,000
Jul 31, 92 10,408 10,410 9,821
Aug 31, 92 10,196 10,140 9,557
Sep 30, 92 10,315 10,210 9,623
Oct 31, 92 10,351 10,290 9,698
Nov 30, 92 10,702 10,660 10,047
Dec 31, 92 10,834 10,957 10,327
Jan 31, 93 10,924 11,088 10,450
Feb 28, 93 11,073 11,078 10,441
Mar 31, 93 11,306 11,599 10,932
Apr 30, 93 11,033 11,358 10,705
May 31, 93 11,328 11,749 11,074
Jun 30, 93 11,361 11,890 11,206
Jul 31, 93 11,315 11,789 11,111
Aug 31, 93 11,743 12,232 11,528
Sep 30, 93 11,653 12,413 11,699
Oct 31, 93 11,894 12,493 11,775
Nov 30, 93 11,781 12,282 11,576
Dec 31, 93 11,923 12,512 11,793
Jan 31, 94 12,328 12,770 12,036
Feb 28, 94 11,994 12,471 11,754
Mar 31, 94 11,472 12,016 11,325
Apr 30, 94 11,619 12,037 11,345
May 31, 94 11,809 12,182 11,481
Jun 30, 94 11,520 11,896 11,212
Jul 31, 94 11,898 12,145 11,446
Aug 31, 94 12,384 12,685 11,955
Sep 30, 94 12,082 12,529 11,808
Oct 31, 94 12,353 12,695 11,965
Nov 30, 94 11,904 12,280 11,574
Dec 31, 94 12,080 12,469 11,752
Jan 31, 95 12,393 12,781 12,046
Feb 28, 95 12,875 13,382 12,612
Mar 31, 95 13,255 13,704 12,916
Apr 30, 95 13,645 14,005 13,199
May 31, 95 14,189 14,583 13,744
Jun 30, 95 14,518 14,851 13,997
Jul 31, 95 14,999 15,333 14,451
Aug 31, 95 15,037 15,243 14,366
Sep 30, 95 15,671 15,769 14,863
Oct 31, 95 15,615 15,668 14,768
Nov 30, 95 16,300 16,240 15,306
Dec 31, 95 16,614 16,147 15,218
Jan 31, 96 17,179 16,584 15,631
Feb 29, 96 17,338 16,852 15,883
Mar 31, 96 17,505 16,864 15,894
Apr 30, 96 17,763 17,483 16,478
May 31, 96 18,220 17,921 16,890
Jun 30, 96 18,290 17,651 16,636
Jul 31, 96 17,482 16,699 15,739
Aug 31, 96 17,852 17,224 16,233
Sep 30, 96 18,855 17,980 16,946
Oct 31, 96 19,375 18,444 17,383
Nov 30, 96 20,839 19,798 18,659
Dec 31, 96 20,426 19,327 18,215
Jan 31, 97 21,701 20,653 19,465
Feb 28, 97 21,872 20,693 19,503
Mar 31, 97 20,975 19,963 18,815
Apr 30, 97 22,226 21,170 19,953
May 31, 97 23,584 22,430 21,141
Jun 30, 97 24,633 23,322 21,981
Jul 31, 97 26,592 25,448 23,985
Aug 31, 97 25,104 24,492 23,083
Sep 30, 97 26,478 25,860 24,373
Oct 31, 97 25,595 24,624 23,208
Nov 30, 97 26,778 25,555 24,085
Dec 31, 97 27,238 26,125 24,623
Jan 31, 98 27,539 26,395 24,877
Feb 28, 98 29,524 28,313 26,685
Mar 31, 98 31,035 29,707 27,999
Apr 30, 98 31,352 29,692 27,985
May 31, 98 30,814 28,928 27,264
Jun 30, 98 32,065 30,007 28,281
Jul 31, 98 31,726 29,467 27,773
Aug 31, 98 27,142 24,701 23,281
Sep 30, 98 28,883 25,795 24,312
Oct 31, 98 31,228 27,923 26,318
Nov 30, 98 33,120 29,647 27,942
Dec 31, 98 35,028 31,364 29,561
VALUE OF A $10,000 INVESTMENT MADE ON 7/1/92
As of 12/31/98
CLASS A SHARES CLASS B SHARES CLASS C SHARES
NAV POP NAV W/CDSC NAV W/CDSC
- --------------------------------------------------------------------------------
$31,364 $29,561 $29,827 $29,827 $29,829 $29,829
AVERAGE ANNUAL TOTAL RETURNS
As of 12/31/98
- --------------------------------------------------------------------------------
CLASS A SHARES CLASS B SHARES CLASS C SHARES
INCEPTION 7/1/92 7/1/92 7/1/94
NAV POP NAV w/CDSC NAV w/CDSC
- --------------------------------------------------------------------------------
1 year 20.05% 13.15% 19.23% 14.23% 19.13% 18.13%
5 years 20.18 18.76 19.30 19.10 19.30 19.30
Life 19.20 18.12 18.29 18.29 18.29 18.29
- --------------------------------------------------------------------------------
Past performance cannot predict future results. Returns and value of an
investment will vary, resulting in a gain or loss on sale. All results shown
assume reinvestment of distributions. NAV returns do not include sales charges
or contingent deferred sales charges (CDSC). Public offering price (POP) returns
include the maximum sales charge of 5.75%. CDSC returns reflect the maximum
charges of 5% for one year and 2% for five years for Class B shares, and 1% for
one year for Class C shares. Performance for different share classes will vary
based on differences in sales charges and fees associated with each class.
Performance results reflect any voluntary waivers or reimbursement of Fund
expenses by the Advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Class C share performance information includes returns of the Fund's Class B
shares for periods prior to the Class C share inception date. These Class B
share returns are not restated to reflect any expense differential (e.g., Rule
12b-1 fees) between Class B shares and Class C shares.
The Standard & Poor's 500 Index is an unmanaged index that tracks the
performance of widely held, large-capitalization U.S. stocks. Unlike mutual
funds, indexes are not investments and do not incur fees or expenses. It is not
possible to invest directly in an index.
<PAGE>
INVESTMENT PORTFOLIO
DECEMBER 31, 1998 (UNAUDITED, IN THOUSANDS)
COMMON STOCKS - 95.2% SHARES VALUE
- --------------------------------------------------------------------------------
FINANCE, INSURANCE & REAL ESTATE - 20.8%
DEPOSITORY INSTITUTIONS - 4.2%
BankAmerica Corp. 25 $ 1,517
Chase Manhattan Corp. 337 22,964
Comerica, Inc. 124 8,442
Dime Bancorp, Inc. 173 4,568
Wells Fargo & Co. 271 10,823
----------
48,314
----------
INSURANCE CARRIERS - 11.3%
Allstate Corp. 225 8,683
Ambac Financial Group, Inc. 175 10,533
American General Corp. 154 11,988
American International Group, Inc. 107 10,368
CIGNA Corp. 207 16,004
Citigroup Inc. 344 17,043
Conseco, Inc. 162 4,939
Loews Corp. 108 10,611
Progressive Corp. 91 15,464
United Healthcare Corp. 203 8,755
Wellpoint Health Networks, Inc., Class A 162 14,050
----------
128,438
----------
NONDEPOSITORY CREDIT INSTITUTIONS - 4.2%
American Express Co. 103 10,573
Capital One Financial Corp. 46 5,290
Fannie Mae 234 17,279
Freddie Mac 222 14,273
----------
47,415
----------
SECURITY BROKERS & DEALERS - 1.1%
Bear Stearns Companies, Inc. 94 3,498
Morgan Stanley Dean Witter & Co. 133 9,471
----------
12,969
----------
................................................................................
MANUFACTURING - 44.2%
APPAREL - 0.8%
VF Corp. 204 9,558
----------
CHEMICALS & ALLIED PRODUCTS - 9.8%
American Home Products Corp. 97 5,488
Amgen, Inc. 35 3,660
Dow Chemical Co. 108 9,776
Eli Lilly & Co. 97 8,594
Goodrich (B.F.) Co. 98 3,512
Johnson & Johnson 57 4,764
Merck & Co., Inc. 75 11,047
Mylan Laboratories 81 2,558
Pfizer, Inc. 142 17,812
Pharmacia & Upjohn, Inc. 100 5,663
Procter & Gamble Co. 66 5,999
Rohm and Haas Co. 207 6,239
Schering-Plough Corp. 245 13,525
Warner-Lambert Co. 172 12,917
----------
111,554
----------
COMMUNICATIONS EQUIPMENT - 2.0%
Lucent Technologies, Inc. 151 16,608
Tellabs, Inc. 89 6,068
----------
22,676
----------
ELECTRICAL INDUSTRIAL EQUIPMENT - 2.1%
General Electric Co. 232 23,658
----------
ELECTRONIC COMPONENTS - 3.5%
Intel Corp. 255 30,222
Texas Instruments, Inc. 109 9,292
----------
39,514
----------
FABRICATED METAL - 0.7%
Crown Cork & Seal Co., Inc. 159 4,890
Danaher Corp. 65 3,525
----------
8,415
----------
FOOD & KINDRED PRODUCTS - 3.7%
Heinz (H.J.) Co. 98 5,549
Philip Morris Companies, Inc. 524 28,034
Quaker Oats Co. 96 5,730
Tyson Foods, Inc. 125 2,656
----------
41,969
----------
FURNITURE & FIXTURES - 1.8%
Herman Miller, Inc. 246 6,619
Johnson Controls, Inc. 78 4,626
Masco Corp. 335 9,640
----------
20,885
----------
HOUSEHOLD APPLIANCES - 0.4%
Maytag Corp. 68 4,208
----------
MACHINERY & COMPUTER EQUIPMENT - 9.0%
Applied Materials, Inc. 220 9,391
Baker Hughes, Inc. 266 4,707
Compaq Computer Corp. 357 14,985
EMC Corp. (a) 84 7,123
Ingersoll Rand Co. 253 11,880
International Business Machines Corp. 82 15,057
Sun Microsystems, Inc. (a) 135 11,594
Tyco International Ltd. 180 13,586
Unisys Corp. 381 13,134
Varco International, Inc. (a) 190 1,473
----------
102,930
----------
MEASURING & ANALYZING INSTRUMENTS - 0.8%
Eastman Kodak Co. 37 2,664
Honeywell, Inc. 80 6,002
----------
8,666
----------
PETROLEUM REFINING - 3.4%
Chevron Corp. 22 1,858
Exxon Corp. 168 12,277
Mobil Corp. 139 12,067
Texaco, Inc. 145 7,646
USX-Marathon Group 151 4,558
----------
38,406
----------
PRIMARY METAL - 0.5%
Aluminum Company of America 79 5,890
----------
TOBBACCO PRODUCTS - 0.5%
Fortune Brands, Inc. 176 5,566
----------
TRANSPORTATION EQUIPMENT - 5.2%
DaimlerChrysler AG 86 8,265
Ford Motor Co. 200 11,726
General Dynamics Corp. 150 8,805
General Motors Corp. 74 5,296
Lockheed Martin Corp. 119 10,043
United Technologies Corp. 138 14,986
----------
59,121
----------
................................................................................
MINING & ENERGY - 1.7%
CRUDE PETROLEUM AND NATURAL GAS - 0.2%
Burlington Resources, Inc. 73 2,614
----------
NONMETALLIC, EXCEPT FUELS - 0.4%
Vulcan Materials Co. 34 $ 4,486
----------
OIL & GAS EXTRACTION - 0.5%
Sonat Offshore Drilling Co. 194 5,191
----------
OIL & GAS FIELD SERVICES - 0.6%
Schlumberger Ltd. 156 7,172
----------
................................................................................
RETAIL TRADE - 9.3%
APPAREL & ACCESSORY STORES - 1.1%
TJX Companies, Inc. 442 12,812
----------
FOOD STORES - 2.7%
Albertson's, Inc. 205 13,043
Kroger Corp. 99 5,977
Safeway, Inc. (a) 188 11,459
----------
30,479
----------
GENERAL MERCHANDISE STORES - 4.4%
Dayton Hudson Corp. 237 12,841
Dillard Department Stores, Inc. 130 3,689
Family Dollar Stores, Inc. 146 3,201
Federated Department Stores, Inc. (a) 176 7,675
Kmart Corp. 353 5,404
Wal-Mart Stores, Inc. 210 17,110
----------
49,920
----------
MISCELLANEOUS RETAIL - 1.1%
Office Depot, Inc. (a) 167 6,154
Rite Aid Corp. 124 6,146
----------
12,300
----------
................................................................................
SERVICES - 5.4%
BUSINESS SERVICES - 0.3%
Omnicom Group, Inc. 65 3,747
----------
COMPUTER RELATED SERVICES - 1.4%
Cadence Design Systems, Inc. (a) 161 4,802
HBO & Co. 158 4,541
Teradyne, Inc. 162 6,852
----------
16,195
----------
COMPUTER SOFTWARE - 3.7%
Compuware Corp. 78 $ 6,102
Microsoft Corp. (a) 254 35,282
----------
41,384
----------
................................................................................
TRANSPORTATION, COMMUNICATION, ELECTRIC,
GAS & SANITARY SERVICES - 12.4%
AIR TRANSPORTATION - 1.2%
AMR Corp. (a) 31 1,817
Continental Airlines, Inc. Class B (a) 130 4,362
Delta Air Lines, Inc. 83 4,331
US Airways Group, Inc. (a) 63 3,250
----------
13,760
----------
ELECTRIC SERVICES - 3.8%
Consolidated Edison Co. of New York 104 5,504
Edison International 285 7,944
FPL Group, Inc. 122 7,500
GPU, Inc. 248 10,941
NIPSCO Industries, Inc. 181 5,512
PG&E Corp. 162 5,113
----------
42,514
----------
TELECOMMUNICATIONS - 7.1%
Ameritech Corp. 201 12,764
Bell Atlantic Corp. 119 6,737
BellSouth Corp. 269 13,416
GTE Corp. 177 11,923
MCI WorldCom, Inc. 333 23,925
US West Communications Group 182 11,729
----------
80,494
----------
WATER TRANSPORTATION - 0.3%
Carnival Corp. 80 3,850
----------
................................................................................
WHOLESALE TRADE - 1.4%
NONDURABLE GOODS
Bergen Brunswig Corp., Class A 213 7,428
Cardinal Health, Inc. 110 8,339
----------
15,767
----------
TOTAL COMMON STOCKS (cost of $804,241) 1,082,837
----------
- --------------------------------------------------------------------------------
CORPORATE FIXED INCOME BONDS & NOTES - 2.5%
- --------------------------------------------------------------------------------
FINANCE, INSURANCE & REAL ESTATE - 0.8%
DEPOSITORY INSTITUTIONS - 0.3%
Fleet/Norstar Financial Group, Inc.
8.625% 01/15/2007 $ 3,000 $ 3,535
----------
NONDEPOSITORY CREDIT INSTITUTIONS - 0.5%
General Motors Acceptance Corp.,
8.500% 01/01/2003 4,000 4,397
Household Finance Co.,
8.250% 02/15/2005 1,820 2,027
----------
6,424
----------
................................................................................
MANUFACTURING - 0.3%
MACHINERY & COMPUTER EQUIPMENT
Xerox Corp.
8.125% 04/15/2002 3,000 3,238
----------
................................................................................
MINING & ENERGY - 0.3%
CRUDE PETROLEUM & NATURAL GAS
Union Oil Co. of California,
7.200% 05/15/2005 3,000 3,095
----------
................................................................................
RETAIL TRADE - 0.3%
GENERAL MERCHANDISE STORES
Wal-Mart Stores, Inc.
8.625% 04/01/2001 3,000 3,215
----------
................................................................................
TRANSPORTATION, COMMUNICATION, ELECTRIC,
GAS & SANITARY SERVICES - 0.8%
ELECTRIC SERVICES - 0.3%
Texas Utilities Electric Co.
8.250% 04/01/2004 3,000 3,305
----------
GAS SERVICES - 0.2%
Southern Natural Gas Co.
8.625% 05/01/2002 2,500 2,711
----------
RAILROAD - 0.3%
Norfolk Southern Corp.
7.875% 02/15/2004 3,000 3,292
----------
TOTAL CORPORATE FIXED INCOME
BONDS & NOTES (cost of $28,188) 28,815
----------
TOTAL INVESTMENTS - 97.7% (cost of $832,429) (b) 1,111,652
----------
- --------------------------------------------------------------------------------
SHORT-TERM OBLIGATIONS - 2.0%
- --------------------------------------------------------------------------------
Repurchase agreement with ABN AMRO Chicago Corp., dated 12/31/98, due 1/04/99
at 4.750% collateralized by U.S. Treasury notes with various maturities to
2015, market value $23,284
(repurchase proceeds $22,894) $22,882 $ 22,882
----------
OTHER ASSETS & LIABILITIES, NET - 0.3% 3,391
- --------------------------------------------------------------------------------
NET ASSETS - 100.0% $1,137,925
----------
NOTES TO INVESTMENT PORTFOLIO:
- --------------------------------------------------------------------------------
(a) Non-incoming producing.
(b) Cost for federal income tax purposes is $833,100.
See notes to financial statements.
2<PAGE>
STATEMENT OF ASSETS & LIABILITIES
DECEMBER 31, 1998 (UNAUDITED)
(in thousands except for per share amounts and footnotes)
ASSETS
Investments at value (cost $832,429) $1,111,652
Short-term obligations 22,882
----------
1,134,534
Receivable for:
Fund shares sold $ 4,884
Dividends 1,054
Interest 680
Other 175 6,793
------- ----------
Total Assets 1,141,327
LIABILITIES
Payable for:
Fund shares repurchased 1,996
Investments purchased 1,340
Distributions 3
Accrued:
Deferred Trustees fees 7
Other 56
-------
Total Liabilities 3,402
----------
NET ASSETS $1,137,925
----------
Net asset value & redemption price per share - Class A
($323,985/16,173) $ 20.03(a)
----------
Maximum offering price per share - Class A
($20.03/0.9425) $ 21.25(b)
----------
Net asset value & offering price per share - Class B
($782,604/39,938) $ 19.60(a)
----------
Net asset value & offering price per share - Class C
($31,336/1,591) $ 19.69(a)
----------
COMPOSITION OF NET ASSETS
Capital paid in $ 826,905
Overdistributed net investment income (1,032)
Accumulated net realized gains 32,829
Net unrealized appreciation 279,223
----------
$1,137,925
----------
(a) Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
(b) On sales of $50,000 or more the offering price is reduced.
See notes to financial statements.
<PAGE>
STATEMENT OF OPERATIONS
FOR SIX MONTHS ENDED DECEMBER 31, 1998
(UNAUDITED)
(in thousands)
INVESTMENT INCOME
Dividends $ 6,419
Interest 2,101
---------
8,520
EXPENSES
Management fee $ 3,972
Service fee 1,266
Distribution fee - Class B 2,527
Distribution fee - Class C 104
Transfer agent 1,349
Bookkeeping fee 177
Trustees fee 21
Custodian fee 15
Audit fee 14
Legal fee 4
Registration fee 53
Reports to shareholders 11
Other 20 9,533
------- ---------
Net Investment Loss (1,013)
---------
NET REALIZED & UNREALIZED GAIN ON PORTFOLIO POSITIONS
Net realized gain 27,912
Change in net unrealized appreciation during
the period 22,632
---------
Net Gain 50,544
---------
Increase in Net Assets from Operations $ 49,531
---------
See notes to financial statements.
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
(Unaudited)
Six months
ended ear ended
(in thousands) December 31 June 30
----------------------------
INCREASE (DECREASE) IN NET ASSETS 1998 1998 (a)
Operations:
Net investment income (loss) $ (1,013) $ 133
Net realized gain 27,912 106,072
Net unrealized appreciation 22,632 82,936
---------- ----------
Net Increase from Operations 49,531 189,141
Distributions:
From net investment income - Class A - (133)
In excess of net investment income - Class A - (467)
From net realized gains - Class A (13,375) (28,096)
From net realized gains - Class B (32,785) (54,761)
From net realized gains - Class C (1,307) (1,472)
---------- ----------
2,064 104,212
---------- ----------
Fund Share Transactions:
Receipts for shares sold - Class A 58,886 101,316
Value of distributions reinvested - Class A 12,286 26,994
Cost of shares repurchased - Class A (53,745) (72,950)
---------- ----------
17,427 55,360
---------- ----------
Receipts for shares sold - Class B 153,575 211,504
Value of distributions reinvested - Class B 30,799 51,719
Cost of shares repurchased - Class B (64,478) (80,862)
---------- ----------
119,896 182,361
---------- ----------
Receipts for shares sold - Class C 5,355 19,023
Value of distributions reinvested - Class C 1,245 1,415
Cost of shares repurchased - Class C (3,465) (5,871)
---------- ----------
3,135 14,567
---------- ----------
Net Increase from Fund Share
Transactions 140,458 252,288
---------- ----------
Total Increase 142,522 356,500
NET ASSETS
Beginning of period 995,403 638,903
---------- ----------
End of period (net of overdistributed
net investment income of $1,032 and
$597, respectively) $1,137,925 $ 995,403
---------- ----------
(a) Class D shares were redesignated Class C shares on July 1, 1997.
See notes to financial statements.
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS - CONT.
(Unaudited)
Six months
ended Year ended
December 31 June 30
------------------------------
NUMBER OF FUND SHARES 1998 1998 (a)
Sold - Class A 3,079 5,358
Issued for distributions reinvested - Class A 632 1,536
Repurchased - Class A (2,865) (3,855)
------ ------
846 3,039
------ ------
Sold - Class B 8,294 11,217
Issued for distributions reinvested - Class B 1,617 2,981
Repurchased - Class B (3,532) (4,344)
------ ------
6,379 9,854
------ ------
Sold - Class C 287 1,003
Issued for distributions reinvested - Class C 65 81
Repurchased - Class C (189) (319)
------ ------
163 765
------ ------
(a) Class D shares were redesigned Class C shares on July 1, 1997.
See notes to financial statements.
<PAGE>
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 (UNAUDITED)
NOTE 1. INTERIM FINANCIAL STATEMENTS
................................................................................
In the opinion of Colonial U.S. Growth & Income Fund (the Fund), formerly known
as Colonial U.S. Stock Fund, the accompanying financial statements contain all
normal and recurring adjustments necessary for the fair presentation of the
financial position of the Fund at December 31, 1998, and the results of its
operations, the changes in its net assets and the financial highlights for the
six months then ended.
NOTE 2. ACCOUNTING POLICIES
................................................................................
ORGANIZATION: The Fund is a diversified portfolio of a Massachusetts business
trust, registered under the Investment Company Act of 1940, as amended, as an
open-end, management company. The Fund's investment objective is to seek
long-term growth and income. The Fund may issue an unlimited number of shares.
The Fund offers three classes of shares: Class A, Class B and Class C. Class A
shares are sold with a front-end sales charge and a 1.00% contingent deferred
sales charge on redemptions made within eighteen months on an original purchase
of $1 million to $5 million. Class B shares are subject to an annual
distribution fee and a contingent deferred sales charge and will convert to
Class A shares when they have been outstanding approximately eight years. Class
C shares are subject to an annual distribution fee and a contingent deferred
sales charge on redemptions made within one year after purchase.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates. The following is a summary of
significant accounting policies consistently followed by the Fund in the
preparation of its financial statements.
SECURITY VALUATION AND TRANSACTIONS: Equity securities generally are valued at
the last sale price or, in the case of unlisted or listed securities for which
there were no sales during the day, at current quoted bid prices.
Debt securities generally are valued by a pricing service based upon market
transactions for normal, institutional-size trading units of similar securities.
When management deems it appropriate, an over-the-counter or exchange bid
quotation is used.
Short-term obligations with a maturity of 60 days or less are valued at
amortized cost.
Portfolio positions for which market quotations are not readily available are
valued at fair value under procedures approved by the Trustees.
Security transactions are accounted for on the date the securities are
purchased, sold or mature.
Cost is determined and gains and losses are based upon the specific
identification method for both financial statement and federal income tax
purposes.
DETERMINATION OF CLASS NET ASSET VALUES AND FINANCIAL HIGHLIGHTS: All income,
expenses (other than the Class B and Class C distribution fees), and realized
and unrealized gains (losses) are allocated to each class proportionately on a
daily basis for purposes of determining the net asset value of each class.
Per share data was calculated using the average shares outstanding during the
period. In addition, Class B and Class C net investment income per share data
reflects the distribution fee per share applicable to Class B and Class C shares
only.
Class B and Class C ratios are calculated by adjusting the expense and net
investment income ratios for the Fund for the entire period by the distribution
fees applicable to Class B and Class C shares only.
FEDERAL INCOME TAXES: Consistent with the Fund's policy to qualify as a
regulated investment company and to distribute all of its taxable income, no
federal income tax has been accrued.
INTEREST INCOME, DEBT DISCOUNT AND PREMIUM: Interest income is recorded on the
accrual basis. Original issue discount is accreted to interest income over the
life of a security with a corresponding increase in the cost basis; premium and
market discount are not amortized or accreted.
DISTRIBUTIONS TO SHAREHOLDERS: Distributions to shareholders are recorded on the
ex-date.
The amount and character of income and gains to be distributed are determined in
accordance with income tax regulations which may differ from generally accepted
accounting principles. Reclassifications are made to the Fund's capital accounts
to reflect income and gains available for distribution (or available capital
loss carryforwards) under income tax regulations.
OTHER: Corporate actions are recorded on the ex-date.
The Fund's custodian takes possession through the federal book-entry system of
securities collateralizing repurchase agreements. Collateral is marked-to-market
daily to ensure that the market value of the underlying assets remains
sufficient to protect the Fund. The Fund may experience costs and delays in
liquidating the collateral if the issuer defaults or enters bankruptcy.
NOTE 3. FEES AND COMPENSATION PAID TO AFFILIATES
................................................................................
MANAGEMENT FEE: Colonial Management Associates, Inc. (the Advisor) is the
investment Advisor of the Fund and furnishes accounting and other services and
office facilities for a monthly fee equal to 0.80% annually of the Fund's
average net assets.
BOOKKEEPING FEE: The Advisor provides bookkeeping and pricing services for
$27,000 per year plus 0.035% of the Fund's average net assets over $50 million.
TRANSFER AGENT: Liberty Funds Services, Inc., formerly Colonial Investors
Service Center Inc., (the Transfer Agent), an affiliate of the Advisor, provides
shareholder services for a monthly fee equal to 0.236% annually of the Fund's
average net assets and receives reimbursement for certain out of pocket
expenses.
Effective October 1, 1997 and continuing through September 1998, the Transfer
Agent fee was reduced by 0.0012% in cumulative monthly increments, resulting in
a decrease in the fee from 0.25% to 0.236% annually.
UNDERWRITING DISCOUNTS, SERVICE AND DISTRIBUTION FEES: Liberty Funds
Distributor, Inc., formerly Liberty Financial Investments, Inc. (the
Distributor), a subsidiary of the Advisor, is the Fund's principal underwriter.
For the six months ended December 31, 1998, the Fund has been advised that the
Distributor retained net underwriting discounts of $571,748 on sales of the
Fund's Class A shares and received contingent deferred sales charges (CDSC) of
$6,998, $616,323 and $11,220 on Class A, Class B and Class C share redemptions,
respectively.
The Fund has adopted a 12b-1 plan which requires it to pay the Distributor a
service fee equal to 0.25% annually of the Fund's net assets as of the 20th of
each month. The plan also requires the payment of a distribution fee to the
Distributor equal to 0.75% annually of the average net assets attributable to
Class B shares and Class C shares, only.
The CDSC and the fees received from the 12b-1 plan are used principally as
repayment to the Distributor for amounts paid by the Distributor to dealers who
sold such shares.
OTHER: The Fund pays no compensation to its officers, all of whom
are employees of the Advisor.
The Fund's Trustees may participate in a deferred compensation plan which may be
terminated at any time. Obligations of the plan will be paid solely out of the
Fund's assets.
NOTE 4. PORTFOLIO INFORMATION
................................................................................
INVESTMENT ACTIVITY: During the six months ended December 31, 1998, purchases
and sales of investments, other than short-term obligations, were $518,033,567
and $392,708,666, respectively.
Unrealized appreciation (depreciation) at December 31, 1998 based on cost of
investments for federal income tax purposes was:
Gross unrealized appreciation $305,828,914
Gross unrealized depreciation (27,276,547)
------------
Net unrealized appreciation $278,552,367
------------
OTHER: The Fund may focus its investments in certain industries,
subjecting it to greater risk than a fund that is more diversified.
NOTE 5. LINE OF CREDIT
................................................................................
The Fund may borrow up to 33 1/3% of its net assets under a line of credit for
temporary or emergency purposes. Any borrowings bear interest at one of the
following options determined at the inception of the loan: (1) federal funds
rate plus 1/2 of 1%, (2) the lending bank's base rate or (3) IBOR offshore loan
rate plus 1/2 of 1%. There were no borrowings under the line of credit during
the six months ended December 31, 1998.
NOTE 6. RESULTS OF SPECIAL MEETING OF SHAREHOLDERS (UNAUDITED)
................................................................................
On October 30, 1998, a Special Meeting of Shareholders of the Fund was held to
approve the following items, all as described in the Proxy Statement for the
Meeting. On August 21, 1998, the record date for the Meeting, the Fund had
outstanding 52,524,363 shares of beneficial interest. The votes cast at the
Meeting were as follows:
Authority
For Withheld
----- ---------
To Elect a Board of Trustees.
Robert J. Birnbaum 25,593,327 1,128,932
Tom Bleasdale 25,602,427 1,119,832
John Carberry 25,597,805 1,124,454
Lora S. Collins 25,598,306 1,123,953
James E. Grinnell 25,596,809 1,125,450
Richard W. Lowry 25,599,032 1,123,227
Salvatore Macera 25,595,992 1,126,267
William E. Mayer 25,595,968 1,126,291
James L. Moody, Jr. 25,603,217 1,119,042
John J. Neuhauser 25,597,344 1,124,915
Thomas E. Stitzel 25,601,109 1,121,150
Robert L. Sullivan 25,597,151 1,125,108
Anne-Lee Verville 25,597,968 1,124,291
To amend fundamental investment policies regarding borrowing and lending.
For Against Abstain
--- ------- -------
18,212,721 812,097 1,498,292
To approve policies for a master fund/feeder fund structure.
For Against Abstain
--- ------- -------
18,091,966 827,505 1,603,637
<PAGE>
FINANCIAL HIGHLIGHTS
Selected data for a share of each class outstanding throughout each period are
as follows:
(Unaudited)
Six months ended December 31
--------------------------------------------
1998
Class A Class B Class C
-------- -------- --------
Net asset value -
Beginning of period $ 20.020 $ 19.680 $ 19.780
-------- -------- --------
INCOME FROM INVESTMENT OPERATIONS:
Net investment
income (loss) (a) 0.030 (0.039) (0.039)
Net realized and
unrealized gain 0.850 0.829 0.819
-------- -------- --------
Total from Investment
Operations 0.880 0.790 0.780
-------- -------- --------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS:
From net investment income -- -- --
In excess of net investment income -- -- --
From net realized
gains (0.870) (0.870) (0.870)
-------- -------- --------
Total Distributions Declared
to Shareholders (0.870) (0.870) (0.870)
-------- -------- --------
Net asset value -
End of period $ 20.030 $ 19.600 $ 19.690
-------- -------- --------
Total return (c) 4.52%(d) 4.14%(d) 4.07%(d)
-------- -------- --------
RATIOS TO AVERAGE NET ASSETS
Expenses (e) 1.38%(f) 2.13%(f) 2.13%(f)
Net investment income (e) 0.34%(f) (0.41)%(f) (0.41%(f)
Portfolio turnover 41%(d) 41%(d) 41%(d)
Net assets at end
of period (000) $323,985 $782,604 $ 31,336
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Class D shares were redesignated to Class C shares on July 1, 1997.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Not annualized.
(e) The benefits derived from custody credits and directed brokerage
arrangements had no impact. (f) Annualized.
<PAGE>
FINANCIAL HIGHLIGHTS - CONT.
Year ended June 30
- --------------------------------------------------------------------------------
1998 1997
Class A Class B Class C(b) Class A Class B Class C
- -------- -------- ------- -------- -------- --------
$ 17.550 $ 17.370 $17.440 $ 14.470 $ 14.360 $ 14.410
- -------- -------- ------- -------- -------- --------
0.097 (0.043) (0.044) 0.099 (0.015) (0.015)
4.620 4.553 4.584 4.314 4.275 4.295
- -------- -------- ------- -------- -------- --------
4.717 4.510 4.540 4.413 4.260 4.280
- -------- -------- ------- -------- -------- --------
(0.010) -- -- (0.072) -- --
(0.037) -- -- (0.011) -- --
(2.200) (2.200) (2.200) (1.250) (1.250) (1.250)
- -------- -------- ------- -------- -------- --------
(2.247) (2.200) (2.200) (1.333) (1.250) (1.250)
- -------- -------- ------- -------- -------- --------
$ 20.020 $ 19.680 $19.780 $ 17.550 $ 17.370 $ 17.440
- -------- -------- ------- -------- -------- --------
28.66% 27.67% 27.73% 32.13% 31.21% 31.24%
- -------- -------- ------- -------- -------- --------
1.41% 2.16% 2.16% 1.45% 2.20% 2.20%
0.53% (0.22)% (0.22)% 0.65% (0.10)% (0.10)%
53% 53% 53% 83% 83% 83%
$306,864 $660,305 $28,234 $215,680 $411,670 $ 11,553
<PAGE>
FINANCIAL HIGHLIGHTS - CONT.
Selected data for a share of each class outstanding throughout each period are
as follows:
Year ended June 30
--------------------------------------------
1996
Class A Class B Class C
-------- -------- --------
Net asset value -
Beginning of period $ 13.260 $ 13.180 $ 13.240
-------- -------- --------
INCOME FROM INVESTMENT OPERATIONS:
Net investment
income (loss) (a) 0.121 0.017 0.016
Net realized and
unrealized gain (loss) 2.292 2.265 2.268
-------- -------- --------
Total from Investment
Operations 2.413 2.282 2.284
-------- -------- --------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS:
From net investment income (0.118) (0.017) (0.029)
From net realized
gains (1.085) (1.085) (1.085)
-------- -------- --------
Total Distributions Declared
to Shareholders (1.203) (1.102) (1.114)
-------- -------- --------
Net asset value -
End of period $ 14.470 $ 14.360 $ 14.410
-------- -------- --------
Total return (b) 18.85% 17.91% 17.84%
-------- -------- --------
RATIOS TO AVERAGE NET ASSETS
Expenses 1.45% (c) 2.20% (c) 2.20% (c)
Net investment income 0.87% (c) 0.12% (c) 0.12% (c)
Portfolio turnover 89% 89% 89%
Net assets at end
of period (000) $168,554 $306,718 $ 8,458
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(c) The benefits derived from custody credits and directed brokerage
arrangements had no impact. Prior years' ratios are net of benfits received,
if any.
<PAGE>
FINANCIAL HIGHLIGHTS - CONT.
Year ended June 30
-----------------------------------------------------------------------
1995 1994
Class A Class B Class C Class A Class B
-------- -------- ------- -------- --------
$ 11.460 $ 11.400 $11.460 $ 11.820 $ 11.770
-------- -------- ------- -------- --------
0.165 0.075 0.074 0.142 0.053
2.530 2.513 2.534 (0.119) (0.122)
-------- -------- ------- -------- --------
2.695 2.588 2.608 0.023 (0.069)
-------- -------- ------- -------- --------
(0.160) (0.073) (0.093) (0.138) (0.056)
(0.735) (0.735) (0.735) (0.245) (0.245)
-------- -------- ------- -------- --------
(0.895) (0.808) (0.828) (0.383) (0.301)
-------- -------- ------- -------- --------
$ 13.260 $ 13.180 $13.240 $ 11.460 $ 11.400
-------- -------- ------- -------- --------
24.84% 23.94% 24.01% 0.05% (0.71%)
-------- -------- ------- -------- --------
1.46% 2.21% 2.21% 1.49% 2.24%
1.37% 0.62% 0.62% 1.19% 0.44%
84% 84% 84% 117% 117%
$124,171 $218,201 $ 3,028 $ 97,180 $150,121
<PAGE>
HOW TO REACH US
BY PHONE OR BY MAIL
BY TELEPHONE
CUSTOMER CONNECTION - 1-800-345-6611
For 24-hour account information, call from your touch-tone phone. (Rotary
callers will be automatically connected to a representative during business
hours.) A recorded message will guide you through the menu:
For fund prices, dividends and capital gains information ......... press [1]
For account information .......................................... press [2]
To speak to a service representative ............................. press [3]
For yield and total return information ........................... press [4]
For duplicate statements or new supply of checks ................. press [5]
To order duplicate tax forms and year-end statements ............. press [6]
(February through May)
To review your options at any time during your call .............. press [*]
To speak with a shareholder services representative about your account, call
Monday to Friday, 8:00 a.m. to 8:00 p.m. ET, and Saturdays from February through
mid-April, 10:00 a.m. to 2:00 p.m. ET.
TELEPHONE TRANSACTION DEPARTMENT - 1-800-422-3737
To purchase, exchange or sell shares by telephone, call Monday to Friday, 9:00
a.m. to 7:00 p.m. ET. Transactions received after the close of the New York
Stock Exchange will receive the next business day's closing price.
LITERATURE - 1-800-426-3750
To request literature on any fund distributed by Liberty Funds Distributor,
Inc., call Monday to Friday, 8:30 a.m. to 6:30 p.m. ET.
BY MAIL
LIBERTY FUNDS SERVICES, INC.
P.O. BOX 1722
BOSTON, MA 02105-1722
<PAGE>
IMPORTANT INFORMATION ABOUT THIS REPORT
The Transfer Agent for Colonial U.S. Growth & Income Fund is:
Liberty Funds Services, Inc.*
P.O. Box 1722
Boston, MA 02105-1722
1-800-345-6611
Colonial U.S. Growth & Income Fund mails one shareholder report to
each shareholder address. If you would like more than one report, please call
1-800-426-3750 and additional reports will be sent to you.
This report has been prepared for shareholders of Colonial U.S. Growth & Income
Fund. This report may also be used as sales literature when preceded or
accompanied by the current prospectus which provides details of sales charges,
investment objectives and operating policies of the Fund and by the most recent
copy of our Performance Update.
*Effective October 1, 1998, Colonial Investors Service Center, Inc. -- the
Transfer Agent for Colonial, Crabbe Huson, Newport and Stein Roe Advisor Funds
- -- changed its name to Liberty Funds Services, Inc.
<PAGE>
TRUSTEES
ROBERT J. BIRNBAUM
Consultant (formerly Special Counsel, Dechert, Price & Rhoads; President and
Chief Operating Officer, New York Stock Exchange, Inc.; President, American
Stock Exchange, Inc.)
TOM BLEASDALE
Retired (formerly Chairman of the Board and Chief Executive Officer, Shore Bank
& Trust Company)
JOHN CARBERRY
Senior Vice President of Liberty Financial Companies, Inc. (formerly Managing
Director, Salomon Brothers)
LORA S. COLLINS
Attorney (formerly Attorney, Kramer, Levin, Naftalis & Frankel)
JAMES E. GRINNELL
Private Investor (formerly Senior Vice President-Operations, The Rockport
Company)
RICHARD W. LOWRY
Private Investor (formerly Chairman and Chief Executive Officer, U.S. Plywood
Corporation)
SALVATORE MACERA
Private Investor (formerly Executive Vice President of Itek Corp. and President
of Itek Optical & Electronic Industries, Inc.)
WILLIAM E. MAYER
Partner, Development Capital, LLC (formerly Dean, College of Business and
Management, University of Maryland; Dean, Simon Graduate School of Business,
University of Rochester; Chairman and Chief Executive Officer, CS First Boston
Merchant Bank; and President and Chief Executive Officer, The First Boston
Corporation)
JAMES L. MOODY, JR.
Retired (formerly Chairman of the Board, Chief Executive Officer and Director,
Hannaford Bros. Co.)
JOHN J. NEUHAUSER
Dean, Boston College School of Management
THOMAS E. STITZEL
Professor of Finance, College of Business, Boise State University; Business
Consultant and Author
ROBERT L. SULLIVAN
Retired Partner, KPMG LLP (formerly Management Consultant, Saatchi and Saatchi
Consulting Ltd. and Principal and International Practice Director, Management
Consulting, Peat Marwick Main & Co.)
ANNE-LEE VERVILLE
Consultant (formerly General Manager, Global Education Industry, and President,
Applications Solutions Division, IBM Corporation)
[logo] L I B E R T Y
COLONIAL o CRABBE HUSON o NEWPORT o STEIN ROE ADVISOR
Liberty Funds Distributor, Inc. (C)1999
One Financial Center, Boston, MA 02111-2621 1-800-426-3750
Visit us at www.libertyfunds.com
GI-03/340G-1298 (2/99) 99/121
