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111 Corcoran
Bond Fund
Semi-Annual Report
November 30, 1994
FEDERATED SECURITIES CORP.
- ------------------------------------------------
Distributor
682365200
2122402(1/95)
PRESIDENT'S MESSAGE
- --------------------------------------------------------------------------------
Dear Shareholder:
I am pleased to present the Semi-Annual Report to the Shareholders of the 111
Corcoran Bond Fund (the "Fund"). This report covers the six-month period ended
November 30, 1994.
As a shareholder, you will find important information in this report, including
an Investment Review written by the Fund's portfolio manager, the Fund's
Portfolio of Investments and detailed Financial Statements.
To pursue its objective of achieving income, the Fund invests primarily in bonds
rated A or better by a nationally recognized rating agency. As of November 30,
1994, the Fund's portfolio was composed of government obligations (59.5%),
corporate bonds (37.7%), and short-term obligations (3.3%).
At the end of the reporting period, the Fund's net assets amounted to $85
million. It paid dividends of $3.3 million to shareholders, or $0.33 per share.
Thank you for your ongoing confidence in 111 Corcoran Bond Fund. We are pleased
to help you pursue income through bond investing.
Sincerely,
/s/Edward C. Gonzales
Edward C. Gonzales
President
January 15, 1995
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
Interest rates continued to increase during the last six months of 1994,
although at a slower pace. The total return (based on offering price) for the
111 Corcoran Bond Fund for the six-month period ended November 30, 1994 was
(5.20%)*, which was less than some of the popular intermediate maturity indices
as the portfolio has a longer duration. We have used this strategy in an attempt
to enhance the yield on the portfolio, however, it hurt the total return results
last year.
This has been one of the worst bond markets in recent history and we look
forward to a better 1995. The current economic recovery will soon be four years
old. The American consumer has taken on a tremendous amount of debt and may not
be able to finance the recovery at the current rate of growth.
There may be an additional rate increase by the Federal Reserve Board in
January, 1995 but, we feel the peak in rates is near. We believe the portfolio
should be well positioned for 1995.
* Performance quoted represents past performance. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed,
may be worth more or less than their original cost.
111 CORCORAN BOND FUND
PORTFOLIO OF INVESTMENTS
NOVEMBER 30, 1994
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- -------------------------------------------------------------------- -----------
<C> <S> <C>
LONG-TERM INVESTMENTS--97.2%
- ----------------------------------------------------------------------------------
CORPORATE BONDS--37.7%
- ----------------------------------------------------------------------------------
ASSET-BACKED SECURITIES--1.6%
--------------------------------------------------------------------
$ 1,000,000 Discover Card Master Trust, 6.20%, Series 1993A, 11/15/2003 $ 860,730
--------------------------------------------------------------------
500,000 Sears Credit Account Trust, 8.60%, 1991B, 5/15/98 503,780
-------------------------------------------------------------------- -----------
Total 1,364,510
-------------------------------------------------------------------- -----------
AUTO/TRUCK MANUFACTURER--1.2%
--------------------------------------------------------------------
1,000,000 Ford Motor Co., 9.00%, 9/15/2001 1,024,100
-------------------------------------------------------------------- -----------
BANKING--3.3%
--------------------------------------------------------------------
1,500,000 Bankers Trust NY Corp., 7.25%, 1/15/2003 1,374,720
--------------------------------------------------------------------
1,500,000 Boatmens Bancshares, Inc., 7.625%, 10/1/2004 1,399,860
-------------------------------------------------------------------- -----------
Total 2,774,580
-------------------------------------------------------------------- -----------
CHEMICALS--2.4%
--------------------------------------------------------------------
1,750,000 ICI Wilmington, Inc., 8.75%, 5/1/2001 1,778,018
--------------------------------------------------------------------
250,000 Dow Capital BV, 6.30%, 4/24/95 250,060
-------------------------------------------------------------------- -----------
Total 2,028,078
-------------------------------------------------------------------- -----------
CONSUMER PRODUCTS--8.1%
--------------------------------------------------------------------
1,000,000 American Brands, Inc., 7.50%, 5/15/99 973,700
--------------------------------------------------------------------
1,000,000 Joseph E. Seagram & Sons, Inc., 9.75%, 6/15/2000 1,026,610
--------------------------------------------------------------------
1,500,000 Joseph E. Seagram & Sons, Inc., 8.875%, 9/15/2011 1,493,970
--------------------------------------------------------------------
750,000 Philip Morris Cos., Inc., 9.00%, 5/15/98 765,802
--------------------------------------------------------------------
1,000,000 Philip Morris Cos., Inc., 9.00%, 1/1/2001 1,018,620
--------------------------------------------------------------------
1,000,000 Philip Morris Cos., Inc., 7.125%, 8/15/2002 915,450
--------------------------------------------------------------------
750,000 RJR Nabisco Inc., 8.00%, 1/15/2000 707,910
-------------------------------------------------------------------- -----------
Total 6,902,062
-------------------------------------------------------------------- -----------
</TABLE>
111 CORCORAN BOND FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- -------------------------------------------------------------------- -----------
<C> <S> <C>
CORPORATE BONDS--CONTINUED
- ----------------------------------------------------------------------------------
FINANCE--COMMERCIAL--2.7%
--------------------------------------------------------------------
$ 1,750,000 Ford Capital BV, 9.375%, 5/15/2001 $ 1,817,620
--------------------------------------------------------------------
500,000 ITT Financial Corp., 8.625%, 2/15/2005 498,730
-------------------------------------------------------------------- -----------
Total 2,316,350
-------------------------------------------------------------------- -----------
FINANCE--INSURANCE--2.4%
--------------------------------------------------------------------
500,000 AON Corp., 6.875%, 10/1/99 470,960
--------------------------------------------------------------------
500,000 Cigna Corp., 7.40%, 1/15/2003 460,650
--------------------------------------------------------------------
1,000,000 Continental Corp., 7.25%, 3/1/2003 888,710
--------------------------------------------------------------------
250,000 Kemper Corp., 8.80%, 11/1/98 248,132
-------------------------------------------------------------------- -----------
Total 2,068,452
-------------------------------------------------------------------- -----------
FINANCIAL SECURITIES--7.9%
--------------------------------------------------------------------
2,000,000 Bear Stearns Cos., Inc., 6.625%, 1/15/2004 1,719,380
--------------------------------------------------------------------
500,000 Merrill Lynch & Co., Inc., 4.75%, 6/24/96 479,760
--------------------------------------------------------------------
1,000,000 Merrill Lynch & Co., Inc., 6.25%, 10/15/2008 794,510
--------------------------------------------------------------------
1,250,000 Morgan Stanley Group, Inc., 6.375%, 12/15/2003 1,075,425
--------------------------------------------------------------------
1,000,000 Salomon Brothers, Inc., 6.875%, 12/15/2003 863,130
--------------------------------------------------------------------
2,000,000 Smith Barney Holdings, Inc., 5.50%, 1/15/99 1,791,360
-------------------------------------------------------------------- -----------
Total 6,723,565
-------------------------------------------------------------------- -----------
METALS--0.6%
--------------------------------------------------------------------
500,000 Reynolds Metals Co., 9.00%, 8/15/2003 502,085
-------------------------------------------------------------------- -----------
MULTI-INDUSTRY--0.9%
--------------------------------------------------------------------
750,000 Loews Corp., 8.875%, 4/15/2011 751,928
-------------------------------------------------------------------- -----------
OFFICE EQUIPMENT--0.7%
--------------------------------------------------------------------
610,000 Xerox Corp., 9.625%, 10/15/2000 620,443
-------------------------------------------------------------------- -----------
OIL--0.7%
--------------------------------------------------------------------
500,000 Pennzoil Co., conv. deb., 6.50%, 1/15/2003 560,000
-------------------------------------------------------------------- -----------
</TABLE>
111 CORCORAN BOND FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- -------------------------------------------------------------------- -----------
<C> <S> <C>
CORPORATE BONDS--CONTINUED
- ----------------------------------------------------------------------------------
RETAIL--1.2%
--------------------------------------------------------------------
$ 500,000 Sears Roebuck & Co., 9.47%, 1/23/96 $ 511,860
--------------------------------------------------------------------
500,000 Sears Roebuck & Co., medium term note, 6.70%, 7/14/97 483,065
-------------------------------------------------------------------- -----------
Total 994,925
-------------------------------------------------------------------- -----------
UTILITIES--4.0%
--------------------------------------------------------------------
1,000,000 Gulf States Utilities Co., 6.77%, 8/1/2005 866,460
--------------------------------------------------------------------
750,000 Hydro Quebec, 6.375%, 1/15/2002 668,093
--------------------------------------------------------------------
1,000,000 Pacific Gas & Electric Co., 7.75%, 6/30/2004 928,640
--------------------------------------------------------------------
1,000,000 West Penn Power Co., 7.875%, 12/1/2004 947,680
-------------------------------------------------------------------- -----------
Total 3,410,873
-------------------------------------------------------------------- -----------
TOTAL CORPORATE BONDS (IDENTIFIED COST, $34,367,240) 32,041,951
-------------------------------------------------------------------- -----------
GOVERNMENT OBLIGATIONS--59.5%
- ----------------------------------------------------------------------------------
FARM CREDIT SYSTEM FINANCIAL ASSIST CORP.--0.6%
--------------------------------------------------------------------
500,000 9.20%, 9/27/2005 519,795
-------------------------------------------------------------------- -----------
FEDERAL HOME LOAN BANK--4.0%
--------------------------------------------------------------------
500,000 5.00% Structured Note, 9/3/97 444,990
--------------------------------------------------------------------
1,000,000 4.06% Step-up, 5/11/98 936,700
--------------------------------------------------------------------
750,000 5.127% Structured Note, 6/2/98 667,237
--------------------------------------------------------------------
1,000,000 5.675% Structured Note, 2/23/99 904,120
--------------------------------------------------------------------
500,000 7.47%, 5/18/99 488,965
-------------------------------------------------------------------- -----------
Total 3,442,012
-------------------------------------------------------------------- -----------
FEDERAL HOME LOAN MORTGAGE CORPORATION--22.7%
--------------------------------------------------------------------
1,000,000 5.90%, 4/21/2000 898,390
--------------------------------------------------------------------
1,000,000 5.69%, 11/29/2000 880,970
--------------------------------------------------------------------
500,000 6.80%, 9/18/2002 455,530
--------------------------------------------------------------------
250,000 5.00%, Series 1194F, 11/15/2005 233,155
--------------------------------------------------------------------
1,500,000 7.50%, Series 1143VD, 1/15/2006 1,397,325
--------------------------------------------------------------------
1,000,000 8.00%, Series 1033G, 1/15/2006 957,550
--------------------------------------------------------------------
</TABLE>
111 CORCORAN BOND FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- -------------------------------------------------------------------- -----------
<C> <S> <C>
GOVERNMENT OBLIGATIONS--CONTINUED
- ----------------------------------------------------------------------------------
FEDERAL HOME LOAN MORTGAGE CORPORATION--CONTINUED
--------------------------------------------------------------------
$ 3,000,000 8.00%, Series 1171G, 11/15/2006 $ 2,905,800
--------------------------------------------------------------------
250,000 6.00%, Series 1337C, 12/15/2006 217,570
--------------------------------------------------------------------
1,000,000 7.00%, Series 1187H, 12/15/2006 898,160
--------------------------------------------------------------------
84,445 6.50%, Series 1422E, 2/15/2007 71,114
--------------------------------------------------------------------
1,000,000 7.00%, Series 1338J, 2/15/2007 912,100
--------------------------------------------------------------------
1,000,000 6.25%, Series 1553E, 4/15/2007 887,800
--------------------------------------------------------------------
1,000,000 7.00%, 8/15/2007 891,330
--------------------------------------------------------------------
1,000,000 7.00%, Series 1458J, 8/15/2007 905,160
--------------------------------------------------------------------
1,000,000 6.50%, Series 1551E, 9/15/2007 902,390
--------------------------------------------------------------------
176,459 6.50%, Series 1452C, 12/15/2007 145,707
--------------------------------------------------------------------
1,000,000 7.00%, Series 1465GA, 2/15/2008 878,950
--------------------------------------------------------------------
3,000,000 6.25%, Series 1544E, 6/15/2008 2,766,720
--------------------------------------------------------------------
400,000 7.00%, Series 1324VE, 8/15/2008 349,084
--------------------------------------------------------------------
1,000,000 7.00%, Series 1477ID, 11/15/2009 862,420
--------------------------------------------------------------------
500,000 7.00%, Series 1468M, 1/15/2010 438,140
--------------------------------------------------------------------
500,000 7.00%, Series 1228H, 2/15/2022 416,980
-------------------------------------------------------------------- -----------
Total 19,272,345
-------------------------------------------------------------------- -----------
FEDERAL NATIONAL MORTGAGE ASSOCIATION--13.8%
--------------------------------------------------------------------
1,700,000 7.417%, Structured Note, Inverse Floater, 12/2/96 1,648,490
--------------------------------------------------------------------
1,275,000 9.95%, Structured Note 12/29/97 1,309,565
--------------------------------------------------------------------
1,500,000 4.75%, 10/26/98 1,345,035
--------------------------------------------------------------------
250,000 0.00%, 11/22/2001 (Callable 11/22/96 @ 100) 205,433
--------------------------------------------------------------------
2,000,000 7.30%, 10/28/2002 1,876,320
--------------------------------------------------------------------
2,000,000 6.72%, 2/25/2003 1,809,200
--------------------------------------------------------------------
2,000,000 6.625%, 4/10/2003 1,796,660
--------------------------------------------------------------------
1,000,000 6.32%, 12/23/2003 872,000
--------------------------------------------------------------------
</TABLE>
111 CORCORAN BOND FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- -------------------------------------------------------------------- -----------
<C> <S> <C>
GOVERNMENT OBLIGATIONS--CONTINUED
- ----------------------------------------------------------------------------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION--CONTINUED
--------------------------------------------------------------------
$ 1,000,000 6.48%, 2/18/2004 $ 880,160
-------------------------------------------------------------------- -----------
Total 11,742,863
-------------------------------------------------------------------- -----------
FEDERAL NATIONAL MORTGAGE ASSOCIATION--REMICS--14.2%
--------------------------------------------------------------------
1,000,000 7.00%, REMIC, Series 199479G, 11/25/2004 914,490
--------------------------------------------------------------------
1,250,000 7.50%, REMIC, Series 199248G, 11/25/2005 1,202,875
--------------------------------------------------------------------
1,000,000 7.00%, REMIC, Series 199270H, 4/25/2006 921,120
--------------------------------------------------------------------
1,000,000 7.50%, REMIC, Series 199336J, 5/25/2006 920,240
--------------------------------------------------------------------
2,000,000 7.00%, REMIC, Series 1993139KD, 7/25/2006 1,774,100
--------------------------------------------------------------------
1,000,000 8.00%, REMIC, Series 1991150G, 11/25/2006 970,230
--------------------------------------------------------------------
1,000,000 7.25%, REMIC, Series 199250J, 12/25/2006 915,000
--------------------------------------------------------------------
1,000,000 7.00%, REMIC, Series 199253G, 4/25/2007 902,240
--------------------------------------------------------------------
1,000,000 6.00%, REMIC, Series 1993209H, 3/25/2008 840,530
--------------------------------------------------------------------
1,000,000 6.75%, REMIC, Series 199333H, 9/25/2008 871,060
--------------------------------------------------------------------
1,000,000 7.00%, REMIC, Series 1992124D, 4/25/2010 869,470
--------------------------------------------------------------------
1,000,000 8.00%, REMIC, Series 1993017C, 11/25/2010 933,130
-------------------------------------------------------------------- -----------
Total 12,034,485
-------------------------------------------------------------------- -----------
GOVERNMENT AGENCY--0.6%
--------------------------------------------------------------------
500,000 Private Expert Funding Corp., 8.90%, 3/15/95 504,135
-------------------------------------------------------------------- -----------
MORTGAGE-BACKED SECURITIES--1.4%
--------------------------------------------------------------------
1,250,000 CMC CMO, Floating Rate, Series 1994CA14, 3/25/2024 1,162,500
-------------------------------------------------------------------- -----------
SOVEREIGN GOVERNMENT--2.2%
--------------------------------------------------------------------
2,000,000 Ontario Province CDA, 7.375%, 1/27/2003 1,883,280
-------------------------------------------------------------------- -----------
TOTAL GOVERNMENT OBLIGATIONS (IDENTIFIED COST, $54,956,761) 50,561,415
-------------------------------------------------------------------- -----------
TOTAL LONG-TERM INVESTMENTS (IDENTIFIED COST, $89,324,001) 82,603,366
-------------------------------------------------------------------- -----------
</TABLE>
111 CORCORAN BOND FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES VALUE
- ----------- -------------------------------------------------------------------- -----------
<C> <S> <C>
SHORT-TERM INVESTMENTS--3.3%
- ----------------------------------------------------------------------------------
MUTUAL FUND SHARES--3.3%
- ----------------------------------------------------------------------------------
2,810,744 Goldman Sachs Money Market Fund $ 2,810,744
-------------------------------------------------------------------- -----------
TOTAL MUTUAL FUND SHARES (AT NET ASSET VALUE) 2,810,744
-------------------------------------------------------------------- -----------
TOTAL INVESTMENTS (IDENTIFIED COST, $92,134,745) $85,414,110+
-------------------------------------------------------------------- -----------
</TABLE>
+ The cost of investments for federal tax purposes amounts to $92,134,745. The
net unrealized depreciation of investments on a federal tax basis amounts to
$6,720,635, which is comprised of $45,511 appreciation and $6,766,146
depreciation at November 30, 1994.
Note: The categories of investments are shown as a percentage of net assets
($85,008,819) at November 30, 1994.
The following abbreviations are used in this portfolio:
<TABLE>
<S> <C>
CMO -- Collateralized Mortgage Obligation
REMIC -- Real Estate Mortgage Investment Conduit
</TABLE>
(See Notes which are an integral part of the Financial Statements)
111 CORCORAN BOND FUND
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 1994
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
ASSETS:
- ---------------------------------------------------------------------------------
Investments in securities, at value (identified and tax cost $92,134,745) $85,414,110
- ---------------------------------------------------------------------------------
Interest receivable 1,199,235
- ---------------------------------------------------------------------------------
Receivable for Fund shares sold 29,627
- ---------------------------------------------------------------------------------
Deferred expenses 12,426
- --------------------------------------------------------------------------------- -----------
Total assets 86,655,398
- ---------------------------------------------------------------------------------
LIABILITIES:
- ---------------------------------------------------------------------------------
Payable for Fund shares repurchased $1,101,776
- --------------------------------------------------------------------
Dividends payable 504,581
- --------------------------------------------------------------------
Accrued expenses 40,222
- -------------------------------------------------------------------- ----------
Total liabilities 1,646,579
- --------------------------------------------------------------------------------- -----------
NET ASSETS for 9,210,819 shares of beneficial interest outstanding $85,008,819
- --------------------------------------------------------------------------------- -----------
NET ASSETS CONSIST OF:
- ---------------------------------------------------------------------------------
Paid-in capital $95,466,491
- ---------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) of investments (6,720,635)
- ---------------------------------------------------------------------------------
Accumulated net realized gain (loss) on investments (3,738,308)
- ---------------------------------------------------------------------------------
Undistributed net investment income 1,271
- --------------------------------------------------------------------------------- -----------
Total Net Assets $85,008,819
- --------------------------------------------------------------------------------- -----------
NET ASSET VALUE and Redemption Proceeds Per Share:
(net assets of $85,008,819 / 9,210,819 shares of beneficial interest outstanding) $9.23
- --------------------------------------------------------------------------------- -----------
Computation of Offering Price (100/95.5 of $9.23) $9.66*
- --------------------------------------------------------------------------------- -----------
</TABLE>
* See "What Shares Cost" in the prospectus.
(See Notes which are an integral part of the Financial Statements)
111 CORCORAN BOND FUND
STATEMENT OF OPERATIONS
SIX MONTHS ENDED NOVEMBER 30, 1994
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C>
INVESTMENT INCOME:
- ------------------------------------------------------------------------------------
Interest income $ 3,431,463
- ------------------------------------------------------------------------------------
EXPENSES--
- ------------------------------------------------------------------------------------
Investment advisory fee $354,787
- ------------------------------------------------------------------------
Trustees' fees 2,727
- ------------------------------------------------------------------------
Administrative personnel and services fee 71,995
- ------------------------------------------------------------------------
Custodian fees 7,999
- ------------------------------------------------------------------------
Portfolio accounting, transfer and dividend disbursing agent fees and
expenses 48,728
- ------------------------------------------------------------------------
Fund share registration fees 6,874
- ------------------------------------------------------------------------
Auditing fees 7,273
- ------------------------------------------------------------------------
Legal fees 1,586
- ------------------------------------------------------------------------
Printing and postage 5,289
- ------------------------------------------------------------------------
Insurance premiums 3,438
- ------------------------------------------------------------------------
Miscellaneous 2,334
- ------------------------------------------------------------------------ --------
Total expenses 513,030
- ------------------------------------------------------------------------
Deduct--waiver of investment advisory fee 354,787
- ------------------------------------------------------------------------ --------
Net expenses 158,243
- ------------------------------------------------------------------------------------ -----------
Net investment income 3,273,220
- ------------------------------------------------------------------------------------ -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
- ------------------------------------------------------------------------------------
Net realized gain (loss) on investments (identified cost basis) (2,378,609)
- ------------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation) on investments (1,578,395)
- ------------------------------------------------------------------------------------ -----------
Net realized and unrealized gain (loss) on investments (3,957,004)
- ------------------------------------------------------------------------------------ -----------
Change in net assets resulting from operations ($683,784)
- ------------------------------------------------------------------------------------ -----------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
111 CORCORAN BOND FUND
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED MAY 31,
----------------------------
1995* 1994
------------ ------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
- -----------------------------------------------------------------
OPERATIONS--
- -----------------------------------------------------------------
Net investment income $ 3,273,220 $ 4,352,401
- -----------------------------------------------------------------
Net realized gain (loss) on investments ($2,378,609 and $48,353
net loss, respectively, as computed for federal tax purposes) (2,378,609) (1,343,931)
- -----------------------------------------------------------------
Net change in unrealized appreciation (depreciation) on
investments (1,578,395) (5,449,487)
- ----------------------------------------------------------------- ------------ ------------
Change in net assets resulting from operations (683,784) (2,441,017)
- ----------------------------------------------------------------- ------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS--
- -----------------------------------------------------------------
Dividends to shareholders from net investment income (3,273,220) (4,351,094)
- ----------------------------------------------------------------- ------------ ------------
FUND SHARE (PRINCIPAL) TRANSACTIONS--
- -----------------------------------------------------------------
Proceeds from sale of shares 5,095,342 83,855,494
- -----------------------------------------------------------------
Net asset value of shares issued to shareholders in payment of
dividends declared 146,939 202,267
- -----------------------------------------------------------------
Cost of shares redeemed (14,099,503) (11,370,872)
- ----------------------------------------------------------------- ------------ ------------
Change in net assets from Fund share transactions (8,857,222) 72,686,889
- ----------------------------------------------------------------- ------------ ------------
Change in net assets (12,814,226) 65,894,778
- -----------------------------------------------------------------
NET ASSETS:
- -----------------------------------------------------------------
Beginning of period 97,823,045 31,928,267
- ----------------------------------------------------------------- ------------ ------------
End of period (including undistributed net investment income of
$1,271 and $1,271, respectively) $ 85,008,819 $ 97,823,045
- ----------------------------------------------------------------- ------------ ------------
</TABLE>
*Six months ended November 30, 1994 (unaudited).
(See Notes which are an integral part of the Financial Statements)
111 CORCORAN BOND FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
<TABLE>
<CAPTION>
YEAR ENDED MAY 31,
---------------------------------
1995* 1994 1993**
------- ------- -------
<S> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 9.63 $10.13 $10.00
- -------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS
- -------------------------------------------------------------
Net investment income 0.33 0.63 0.49
- -------------------------------------------------------------
Net realized and unrealized gain (loss) on investments (0.40) (0.50) 0.13
- ------------------------------------------------------------- ------ ------ ------
Total from investment operations (0.07) 0.13 0.62
- -------------------------------------------------------------
LESS DISTRIBUTIONS
- -------------------------------------------------------------
Dividends to shareholders from net investment income (0.33) (0.63) (0.49)
- ------------------------------------------------------------- ------ ------ ------
NET ASSET VALUE, END OF PERIOD $ 9.23 $ 9.63 $10.13
- ------------------------------------------------------------- ------ ------ ------
TOTAL RETURN*** (0.77%) 1.21% 6.28%
- -------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
- -------------------------------------------------------------
Expenses 0.33%(b) 0.50% 0.70%(b)
- -------------------------------------------------------------
Net investment income 6.92%(b) 6.32% 6.00%(b)
- -------------------------------------------------------------
Expense waiver/reimbursement (a) 0.75%(b) 0.75% 0.78%(b)
- -------------------------------------------------------------
SUPPLEMENTAL DATA
- -------------------------------------------------------------
Net assets, end of period (000 omitted) $85,009 $97,823 $31,928
- -------------------------------------------------------------
Portfolio turnover rate 29% 76% 59%
- -------------------------------------------------------------
</TABLE>
* Six months ended November 30, 1994 (unaudited).
** Reflects operations for the period from July 15, 1992 (date of initial
public investment) to May 31, 1993.
*** Based on net asset value, which does not reflect the sales load or
contingent deferred sales charge, if applicable.
(a) This voluntary expense decrease is reflected in both the expense and net
investment income ratios shown above.
(b) Computed on an annualized basis.
(See Notes which are an integral part of the Financial Statements)
111 CORCORAN BOND FUND
NOTES TO FINANCIAL STATEMENTS
NOVEMBER 30, 1994
(UNAUDITED)
- --------------------------------------------------------------------------------
(1) ORGANIZATION
The 111 Corcoran Funds (the "Trust") is registered under the Investment Company
Act of 1940, as amended (the "Act"), as an open-end management investment
company. The Trust consists of one diversified portfolio and one non-diversified
portfolio. The financial statements included herein present only those of 111
Corcoran Bond Fund (the "Fund"), a diversified portfolio. The financial
statements of the other portfolio are presented separately. The assets of each
portfolio are segregated and a shareholder's interest is limited to the
portfolio in which shares are held.
(2) SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
policies are in conformity with generally accepted accounting principles.
<TABLE>
<S> <C>
A. INVESTMENT VALUATIONS--U.S. government obligations are generally valued at the mean
between the over-the-counter bid and asked prices as furnished by an independent pricing
service. Corporate bonds (and other fixed-income and asset backed securities) are valued
at the last sale price reported on national securities exchanges on that day, if
available. Otherwise, corporate bonds (and other fixed-income and asset backed
securities) and short-term securities are valued at the prices provided by an independent
pricing service. Investments in other regulated investment companies are valued at net
asset value. Short-term securities with remaining maturities of sixty days or less at the
time of purchase may be valued at amortized cost, which approximates fair market value.
B. INVESTMENT INCOME, EXPENSES AND DISTRIBUTIONS--Interest income and expenses are accrued
daily. Bond premium and discount, if applicable, are amortized as required by the
Internal Revenue Code, as amended (the "Code"). Distributions to shareholders are
recorded on the ex-dividend date.
C. FEDERAL TAXES--It is the Fund's policy to comply with the provisions of the Code
applicable to regulated investment companies and to distribute to shareholders each year
substantially all of its taxable income. Accordingly, no provisions for federal tax are
necessary.
Additionally, net capital losses of $15,652 attributable to security transactions
incurred after October 31, 1993, are treated as arising on June 1, 1994, the first day of
the Fund's next taxable year. At May 31, 1994 the Fund, for federal tax purposes, had a
capital loss carryforward of $48,353 which will reduce the Fund's taxable income arising
from future net realized gain on investments, if any, to the extent permitted by the
Code, and thus will reduce the amount of the distributions to shareholders which would
otherwise be necessary to relieve the Fund of any liability for federal tax.
</TABLE>
111 CORCORAN BOND FUND
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Pursuant to the Code, such capital loss carryforward will expire in 2002 ($48,353).
Additionally, net capital losses of $1,311,230 attributable to security transactions
incurred after October 31, 1993, are treated as arising on June 1, 1994, the first day of
the Fund's next taxable year.
D. WHEN-ISSUED AND DELAYED DELIVERY TRANSACTIONS--The Fund may engage in when-issued or
delayed delivery transactions. The Fund records when-issued securities on the trade date
and maintains security positions such that sufficient liquid assets will be available to
make payment for the securities purchased. Securities purchased on a when-issued or
delayed delivery basis are marked to market daily and begin earning interest on the
settlement date.
E. DEFERRED EXPENSES--The costs incurred by the Fund with respect to registration of its
shares in its first fiscal year, excluding the initial expense of registering the shares,
have been deferred and are being amortized using the straight-line method not to exceed a
period of five years from the Fund's commencement date.
F. OTHER--Investment transactions are accounted for on the trade date.
</TABLE>
(3) SHARES OF BENEFICIAL INTEREST
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value).
Transactions in Fund shares were as follows:
<TABLE>
<CAPTION>
YEAR ENDED MAY 31,
-------------------------
1995* 1994
- ------------------------------------------------------------- ---------- ----------
<S> <C> <C>
Shares sold 533,150 8,111,488
- -------------------------------------------------------------
Shares issued to shareholders in payment of dividends
declared 15,539 20,013
- -------------------------------------------------------------
Shares redeemed (1,498,518) (1,122,983)
- ------------------------------------------------------------- ---------- ----------
Net change resulting from Fund share transactions 949,829 7,008,518
- ------------------------------------------------------------- ---------- ----------
</TABLE>
* Six months ended November 30, 1994.
(4) INVESTMENT ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY FEE--Central Carolina Bank and Trust Company, the Fund's
investment adviser (the "Adviser"), receives for its services an annual
investment advisory fee equal to .75 of 1% of the Fund's average daily net
assets. The Adviser may voluntarily choose to waive its fee. The Adviser can
modify or terminate this voluntary waiver at any time at its sole discretion.
ADMINISTRATIVE FEE--Federated Administrative Services ("FAS") provides the Fund
with certain administrative personnel and services. The FAS fee is based on the
level of average aggregate net assets of the Trust for the period. FAS may
voluntarily choose to waive a portion of its fee.
111 CORCORAN BOND FUND
- --------------------------------------------------------------------------------
TRANSFER AND DIVIDEND DISBURSING AGENT AND PORTFOLIO ACCOUNTING FEES--Federated
Services Company ("FServ") serves as transfer and dividend disbursing agent for
the Fund. The FServ fee is based on the size, type and number of accounts and
transactions made by shareholders.
FServ also maintains the Fund's accounting records. The fee is based on the
level of the Fund's average net assets for the period, plus out-of-pocket
expenses.
ORGANIZATIONAL EXPENSES--Organizational expenses ($46,033) were borne initially
by FAS. The Fund has agreed to reimburse FAS for the organizational expenses
during the five year period following May 1, 1992 (date the Trust first became
effective). For the six months ended November 30, 1994, the Fund paid $4,672
pursuant to this agreement.
Certain of the Officers and Trustees of the Trust are Officers and Directors or
Trustees of the above companies.
(5) INVESTMENT TRANSACTIONS
Purchases and sales of investments, excluding short-term securities, for the six
months ended November 30, 1994 were as follows:
<TABLE>
<S> <C>
- -------------------------------------------------------------------------------
PURCHASES $26,286,781
- ------------------------------------------------------------------------------- -----------
SALES $33,487,609
- ------------------------------------------------------------------------------- -----------
</TABLE>
<TABLE>
<S> <C>
TRUSTEES OFFICERS
- ---------------------------------------------------------------------------------------------
John F. Donahue John F. Donahue
Thomas G. Bigley Chairman
John T. Conroy, Jr. Edward C. Gonzales
William J. Copeland President and Treasurer
James E. Dowd J. Christopher Donahue
Lawrence D. Ellis, M.D. Vice President
Edward L. Flaherty, Jr. Richard B. Fisher
Edward C. Gonzales Vice President
Peter E. Madden Joseph S. Machi
Gregor F. Meyer Vice President and Assistant Treasurer
Wesley W. Posvar John W. McGonigle
Marjorie P. Smuts Vice President and Secretary
David M. Taylor
Assistant Treasurer
C. Grant Anderson
Assistant Secretary
</TABLE>
Mutual funds are not bank deposits or obligations, are not guaranteed by any
bank, and are not insured or guaranteed by the U.S. government, the Federal
Deposit Insurance Corporation, the Federal Reserve Board, or any other
government agency. Investment in mutual funds involves investment risk,
including possible loss of principal.
This report is authorized for distribution to prospective investors only when
preceded or accompanied by the Fund's prospectus which contains facts concerning
its objective and policies, management fees, expenses and other information.
(LOGO)
111 Corcoran
North Carolina
Municipal
Securities Fund
Semi-Annual Report
November 30, 1994
FEDERATED SECURITIES CORP.
Distributor
682365101
2122402(1/95)
PRESIDENT'S MESSAGE
- --------------------------------------------------------------------------------
Dear Shareholder:
I am pleased to present the Semi-Annual Report to the Shareholders of the 111
Corcoran North Carolina Municipal Securities Fund (the "Fund"). This report
covers the six-month period ended November 30, 1994, and includes an Investment
Review written by the Fund's portfolio manager, the Fund's Portfolio of
Investments and detailed Financial Statements.
To pursue its objective of providing income which is exempt from federal regular
income tax and North Carolina state income tax, the Fund invests primarily in a
portfolio of North Carolina municipal securities. As of November 30, 1994,
long-term North Carolina municipal securities made up 95.5% of the Fund's
portfolio.
At the end of the reporting period, the Fund's net assets amounted to $39.7
million. It paid tax-free dividends of $1.09 million to shareholders, or $0.24
per share.*
Thank you for your confidence in 111 Corcoran North Carolina Municipal
Securities Fund. We look forward to continuing to help you pursue tax-free
income through the Fund.
Sincerely,
/s/Edward C. Gonzales
Edward C. Gonzales
President
January 15, 1995
* Income may be subject to the federal alternative minimum tax.
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
The municipal market continued to deteriorate in the last half of 1994 producing
a negative total return (based on offering price) for the portfolio of (9.07%).*
This figure was worse than some of the indices due to the longer duration of the
111 Corcoran North Carolina Municipal Securities Fund.
Despite the bad market we have continued to emphasize high-quality bonds with
intermediate maturities and still feel this is the proper course.
We are looking forward to a hopefully better year in 1995 and while we may get a
rate increase by the Federal Reserve Board in January, 1995, we feel rates are
close to their peak. We believe the portfolio should be well positioned to
participate in a stronger market.
* Performance quoted represents past performance. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed,
may be worth more or less than their original cost.
111 CORCORAN NORTH CAROLINA MUNICIPAL
SECURITIES FUND
PORTFOLIO OF INVESTMENTS
NOVEMBER 30, 1994
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CREDIT
RATING:
PRINCIPAL MOODY'S
AMOUNT ISSUE OR S&P* VALUE
- ---------- -------------------------------------------------------- ------- -----------
<C> <S> <C> <C>
LONG-TERM MUNICIPAL SECURITIES--97.1%
- ------------------------------------------------------------------------
NORTH CAROLINA--95.5%
--------------------------------------------------------
$ 250,000 Alamance County, NC, 5.90%, 5/1/2006
(Callable 5/1/2002 @ 102) AA $ 241,927
--------------------------------------------------------
500,000 Alamance County, NC, 4.70%, 4/1/2007
(Callable 4/1/2003 @ 102) AA 413,950
--------------------------------------------------------
550,000 Alamance County, NC, 4.90%, 4/1/2010
(Callable 4/1/2003 @ 102) AA 445,511
--------------------------------------------------------
350,000 Buncombe County, NC, 5.20% 5/1/2008
(Callable 5/1/2003 @ 102) AA 303,422
--------------------------------------------------------
500,000 Buncombe County, NC, 5.25% Sewer Revenue Bonds
(FGIC Insured), 7/1/2007 AAA 439,745
--------------------------------------------------------
865,000 Cabarrus County, NC, 4.80% (FGIC Insured), 3/1/2010
(Callable 3/1/2003 @ 102) AAA 686,853
--------------------------------------------------------
450,000 Caswell County, NC, 4.80% (FGIC Insured), 6/1/2010
(Callable 2/1/2003 @ 102) AAA 355,082
--------------------------------------------------------
500,000 Catawba County, NC, 5.70% GO Bonds, 6/1/2006
(Callable 6/1/2004 @ 101) AA- 473,750
--------------------------------------------------------
500,000 Catawba County NC, 5.75% GO Bonds, 6/1/2007
(Callable 6/1/2004 @ 101.5) AA- 470,680
--------------------------------------------------------
500,000 Catawba County, NC, 5.85% Hospital Revenue Bonds (AMBAC
Insured), 10/1/2004 (Callable 10/1/2002 @ 102) AAA 488,280
--------------------------------------------------------
500,000 Catawba County, NC, 5.95% Hospital Revenue Bonds (AMBAC
Insured), 10/1/2005 (Callable 10/1/2002 @ 102) AAA 487,115
--------------------------------------------------------
</TABLE>
111 CORCORAN NORTH CAROLINA MUNICIPAL
SECURITIES FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CREDIT
RATING:
PRINCIPAL MOODY'S
AMOUNT ISSUE OR S&P* VALUE
- ---------- -------------------------------------------------------- ------- -----------
<C> <S> <C> <C>
LONG-TERM MUNICIPAL SECURITIES--CONTINUED
- ------------------------------------------------------------------------
NORTH CAROLINA--CONTINUED
--------------------------------------------------------
$ 400,000 Charlotte-Mecklenburg Hospital Authority, NC, 6.375%
Health Care System Revenue Refunding Bonds (Original
Issue Discount: 6.449%)/(Callable 1/1/2002 @ 102) AA $ 390,008
--------------------------------------------------------
500,000 Charlotte, NC, 6.50% 2/1/2008 (Prerefunded 2/1/2001 @
102) AAA 522,520
--------------------------------------------------------
250,000 Charlotte, NC, 6.20% GO Bonds, 6/1/2015
(Callable 6/1/2002 @ 102) AAA 237,237
--------------------------------------------------------
750,000 Cleveland County, NC, 5.10% GO Bonds (FGIC Insured),
6/1/2006 (Callable 6/1/2003 @ 101.5) AAA 668,093
--------------------------------------------------------
225,000 Cleveland County, NC, 5.70% (AMBAC Insured),
3/1/2008 (Callable 3/1/2002 @ 102) AAA 208,955
--------------------------------------------------------
365,000 Craven County, NC, 6.20%, 6/1/99 A1 376,384
--------------------------------------------------------
600,000 Cumberland County, NC, 5.80% (MBIA Insured),
2/1/2007 (Callable 2/1/2003 @ 102) AAA 564,024
--------------------------------------------------------
470,000 Duplin County, NC, 5.30%, 4/1/2007
(Callable 6/1/2003 @ 102) AAA 415,301
--------------------------------------------------------
500,000 Durham & Wake Counties Special Airport District, NC,
5.75%, 4/1/2002 AAA 502,030
--------------------------------------------------------
500,000 Durham, NC, 7.10%, 2/1/95 AAA 502,915
--------------------------------------------------------
500,000 Fayetteville, NC, Public Works Commission, 4.60% Revenue
Bonds (FGIC Insured), 3/1/2005 (Callable 3/1/2003 @ 102) AAA 424,630
--------------------------------------------------------
250,000 Fayetteville, NC, Public Works Commission, 5.90% Revenue
Bonds (FSA Insured), 3/1/2007 (Callable 3/1/2002 @ 102) AAA 237,027
--------------------------------------------------------
600,000 Forsyth County, NC, 6.25%, 3/1/2005
(Callable 3/1/2001 @ 102) AA1 609,456
--------------------------------------------------------
500,000 Goldsboro, NC, 5.50%, 6/1/2008 (Callable 6/1/2003 @ 102) A1 444,375
--------------------------------------------------------
650,000 Goldsboro, NC, 5.50%, 6/1/2009 (Callable 6/1/2003 @ 102) A1 568,770
--------------------------------------------------------
</TABLE>
111 CORCORAN NORTH CAROLINA MUNICIPAL
SECURITIES FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CREDIT
RATING:
PRINCIPAL MOODY'S
AMOUNT ISSUE OR S&P* VALUE
- ---------- -------------------------------------------------------- ------- -----------
<C> <S> <C> <C>
LONG-TERM MUNICIPAL SECURITIES--CONTINUED
- ------------------------------------------------------------------------
NORTH CAROLINA--CONTINUED
--------------------------------------------------------
$ 500,000 Greensboro, NC, 6.30%, 3/1/2012 (Callable 3/1/2002 @
102) AA1 $ 485,620
--------------------------------------------------------
500,000 Greensboro, NC, 5.20%, 5/1/2006 (Callable 5/1/2003 @
101) AA 451,130
--------------------------------------------------------
475,000 Greenville, NC, 4.80%, 3/1/2003 AA 425,681
--------------------------------------------------------
525,000 Greenville, NC, 4.80%, 3/1/2005 (Callable 3/1/2003 @
101) AA 453,931
--------------------------------------------------------
750,000 Greenville, NC, 4.80%, 3/1/2006 AA 636,960
--------------------------------------------------------
1,000,000 Guilford County, NC, 4.90%, 4/1/2001 AA1 946,170
--------------------------------------------------------
500,000 Guilford County, NC, 5.40%, 4/1/2010 (Callable 4/1/2003
@ 102) AA1 438,680
--------------------------------------------------------
350,000 Henderson County, NC, 6.50%, 6/1/2007 (Callable 6/1/2001
@ 102) A1 355,386
--------------------------------------------------------
350,000 Iredell County, NC, 6.125% COP (Statesville School
Project)/(FGIC Insured)/(Original Issue Discount:
6.23%), 6/1/2007 (Callable 6/1/2002 @ 102) AAA 339,752
--------------------------------------------------------
675,000 Lee County, NC, 6.00%, 2/1/2004 (Callable 2/1/2002 @
101) A1 675,871
--------------------------------------------------------
475,000 Lincoln County, NC, 5.00% (FGIC Insured), 6/1/2006
(Callable 6/1/2001 @ 101) AAA 414,058
--------------------------------------------------------
500,000 Lincoln County, NC, 5.10% GO Bonds (FGIC Insured),
6/1/2007, (Callable 6/1/2004 @ 102) AAA 432,210
--------------------------------------------------------
750,000 Mecklenburg County, NC, 4.10%, 4/1/2002 AAA 647,017
--------------------------------------------------------
750,000 Mecklenburg County, NC, 4.10% Refunding Bonds, 4/1/2003 AAA 632,475
--------------------------------------------------------
750,000 Moore County, NC, 4.80%, (AMBAC Insured), 6/1/2006
(Callable 6/1/2003 @ 101.50) AAA 638,580
--------------------------------------------------------
250,000 Mooresville Grade School District, 6.30%, COP (AMBAC
Insured), 10/1/2009 (Callable 10/1/2002 @ 102) AAA 242,028
--------------------------------------------------------
</TABLE>
111 CORCORAN NORTH CAROLINA MUNICIPAL
SECURITIES FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CREDIT
RATING:
PRINCIPAL MOODY'S
AMOUNT ISSUE OR S&P* VALUE
- ---------- -------------------------------------------------------- ------- -----------
<C> <S> <C> <C>
LONG-TERM MUNICIPAL SECURITIES--CONTINUED
- ------------------------------------------------------------------------
NORTH CAROLINA--CONTINUED
--------------------------------------------------------
$ 200,000 New Hanover County, NC, 7.10%, 6/1/2008 (Prerefunded
6/1/99 @ 102) A+ $ 214,500
--------------------------------------------------------
300,000 North Carolina Educational Authority (Elon College
Project), 6.375% Revenue Bonds (Connie Lee Insured),
1/1/2007 (Callable 1/1/2002 @ 102) AAA 297,117
--------------------------------------------------------
200,000 North Carolina Medical Care Commission, 5.95% Revenue
Bonds (Presbyterian Hospital), 10/1/2007 (Callable
10/2/2002 @ 102) AA 189,170
--------------------------------------------------------
500,000 North Carolina Medical Care Commission, 5.50% Revenue
Bonds (Mission Hospital Project)/(MBIA Insured),
10/1/2011 AAA 430,430
--------------------------------------------------------
960,000 North Carolina Eastern Municipal Power Agency, 7.25%
Electric Revenue Refunding Bonds (Series A)/(Original
Issue Discount: 7.50%), 1/1/2021 (Callable 1/1/97 @ 102) A 961,248
--------------------------------------------------------
500,000 North Carolina Eastern Municipal Power Agency, Floating
Rate Revenue Bonds (RIB)/(FGIC Insured), 1/1/2025 AAA 363,750
--------------------------------------------------------
500,000 North Carolina Municipal Power Agency, 5.25% Revenue
Bonds (Original Issue Discount: 5.55%)/(AMBAC Insured),
1/1/2008 AAA 429,615
--------------------------------------------------------
1,250,000 North Carolina Municipal Power Agency Catawba, 5.50%
Electric Revenue Refunding Bonds, 1/1/2001 AAA 1,223,413
--------------------------------------------------------
750,000 North Carolina Municipal Power Agency Catawba, 6.00%
Revenue Bonds, 1/1/2004 A 721,538
--------------------------------------------------------
250,000 North Carolina Municipal Power Agency Catawba, 6.00%
Revenue Bonds (AMBAC Insured), 1/1/2008 AAA 236,135
--------------------------------------------------------
560,000 North Carolina Municipal Power Agency Catawba, 10.50%
Revenue Bonds (Escrowed to Maturity), 1/1/2010 AAA 744,554
--------------------------------------------------------
500,000 North Carolina State, 6.60%, 8/1/97 AAA 515,565
--------------------------------------------------------
</TABLE>
111 CORCORAN NORTH CAROLINA MUNICIPAL
SECURITIES FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CREDIT
RATING:
PRINCIPAL MOODY'S
AMOUNT ISSUE OR S&P* VALUE
- ---------- -------------------------------------------------------- ------- -----------
<C> <S> <C> <C>
LONG-TERM MUNICIPAL SECURITIES--CONTINUED
- ------------------------------------------------------------------------
NORTH CAROLINA--CONTINUED
--------------------------------------------------------
$ 500,000 North Carolina State, 4.70% (Series A), 2/1/2001 AAA $ 467,095
--------------------------------------------------------
535,000 North Carolina State, 6.20%, 3/1/2009 (Prerefunded
3/1/2002 @ 102) AAA 548,124
--------------------------------------------------------
500,000 Orange County, NC, 5.10%, 6/1/2007 (Callable 6/1/2003 @
102) AA+ 436,820
--------------------------------------------------------
520,000 Orange County, NC, 5.50%, 2/1/2008 (Callable 2/1/2004 @
102) AA+ 470,553
--------------------------------------------------------
500,000 Pender County, NC, 4.75% (AMBAC Insured), 6/1/2011
(Callable 6/1/2004 @ 102) AAA 392,980
--------------------------------------------------------
250,000 Person County, NC, 5.40%, 2/1/2009 (Callable 2/1/2003 @
102) A1 220,325
--------------------------------------------------------
250,000 Pitt County, NC, 6.05%, COP (FGIC Insured), 4/1/98 AAA 255,412
--------------------------------------------------------
500,000 Pitt County, NC, 5.10%, 2/1/2007 (Callable 2/1/2003 @
102) AA 438,640
--------------------------------------------------------
500,000 Randolph County, NC, 6.20%, 5/1/2005 (Callable 5/1/2002
@ 101.5) A1 499,205
--------------------------------------------------------
350,000 Randolph County, NC, 6.50%, 4/1/2007 (Callable 4/1/2001
@ 102) A+ 351,431
--------------------------------------------------------
1,000,000 Rocky Mount, NC, 6.30%, 5/1/2009 (Callable 5/1/2002 @
102) A+ 968,680
--------------------------------------------------------
500,000 Rowan County, NC, 6.25% COP, 12/1/2007 (Callable
12/1/2002 @ 100 Sinking Fund) A 484,880
--------------------------------------------------------
500,000 Rowan County, NC, 5.60% (FGIC Insured), 5/1/2010
(Callable 5/1/2004 @ 102) AAA 443,195
--------------------------------------------------------
500,000 Rowan County, NC, 5.60% (FGIC Insured), 5/1/2011
(Callable 5/1/2004 @ 102) AAA 439,365
--------------------------------------------------------
</TABLE>
111 CORCORAN NORTH CAROLINA MUNICIPAL
SECURITIES FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CREDIT
RATING:
PRINCIPAL MOODY'S
AMOUNT ISSUE OR S&P* VALUE
- ---------- -------------------------------------------------------- ------- -----------
<C> <S> <C> <C>
LONG-TERM MUNICIPAL SECURITIES--CONTINUED
- ------------------------------------------------------------------------
NORTH CAROLINA--CONTINUED
--------------------------------------------------------
$ 500,000 Rutherford County, NC, 5.10% (MBIA Insured), 6/1/2008,
(Callable 6/1/2003 @ 102) AAA $ 422,725
--------------------------------------------------------
450,000 Shelby, NC, 5.00%, 3/1/2010 AA 365,665
--------------------------------------------------------
500,000 Union County, NC, 6.50%, 4/1/2005 (Callable 4/1/2001 @
102) A+ 509,355
--------------------------------------------------------
500,000 Union County, NC, 5.80%, 3/1/2006 (Callable 3/1/2002 @
102) A1 476,135
--------------------------------------------------------
500,000 Union County, NC, 6.50%, 4/1/2006 (Callable 4/1/2001 @
102) NR 507,150
--------------------------------------------------------
500,000 University of North Carolina, 4.90% Utilities System
Revenue Refunding Bonds (Original Issue Discount:
4.95%), 8/1/2003 (Callable 8/1/2002 @ 102) AA 454,985
--------------------------------------------------------
500,000 University of North Carolina at Charlotte, 5.00% Revenue
Bonds (MBIA Insured), 1/1/2007 AAA 427,340
--------------------------------------------------------
500,000 Wake County, NC, 6.90% Revenue Bonds (Carolina Power &
Light Co.), 4/1/2009 (Callable 4/1/2000 @ 102) A2 500,785
--------------------------------------------------------
375,000 Watauga County, NC, 4.70%, 6/1/2012 (Callable 6/1/2003 @
102) AA 285,308
--------------------------------------------------------
500,000 Wilmington, NC, 6.30%, 3/1/2005 (Callable 3/1/2002 @
101.5) A1 502,935
--------------------------------------------------------
500,000 Wilmington, NC, 6.40% Water & Sewer GO Bonds, 3/1/2007
(Callable 3/1/2002 @ 102) A+ 497,840
--------------------------------------------------------
500,000 Winston-Salem, NC, 5.25%, COP (Series A), 10/1/96 AA1 502,825
-------------------------------------------------------- -----------
Total 37,890,377
-------------------------------------------------------- -----------
</TABLE>
111 CORCORAN NORTH CAROLINA MUNICIPAL
SECURITIES FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CREDIT
PRINCIPAL RATING:
AMOUNT MOODY'S
OR SHARES ISSUE OR S&P* VALUE
- ---------- -------------------------------------------------------- ------- -----------
<C> <S> <C> <C>
LONG-TERM MUNICIPAL SECURITIES--CONTINUED
- ------------------------------------------------------------------------
PUERTO RICO--1.6%
--------------------------------------------------------
$ 500,000 Puerto Rico Electric & Power, 5.75% Electric Revenue
Refunding Bonds (FSA Insured)/(Original Issue Discount:
6.00%), 7/1/2007 (Callable 7/1/2002 @ 101.5) AAA $ 474,230
--------------------------------------------------------
200,000 Puerto Rico, Floating Rate Revenue Bonds (RIB)/ (MBIA
Insured), 1/16/2015 AAA 137,750
-------------------------------------------------------- -----------
Total 611,980
-------------------------------------------------------- -----------
TOTAL LONG-TERM MUNICIPAL SECURITIES
(IDENTIFIED COST, $41,852,354) 38,502,357
-------------------------------------------------------- -----------
SHORT-TERM INVESTMENTS--0.5%
- ------------------------------------------------------------------------
MUTUAL FUND SHARES--0.5%
- ------------------------------------------------------------------------
37,199 North Carolina Daily Tax-Free Income Money Market Fund 37,199
--------------------------------------------------------
166,400 PNC North Carolina Money Market Fund 166,400
-------------------------------------------------------- -----------
TOTAL MUTUAL FUND SHARES (AT NET ASSET VALUE) 203,599
-------------------------------------------------------- -----------
TOTAL INVESTMENTS (IDENTIFIED COST, $42,055,953) $38,705,956+
-------------------------------------------------------- -----------
</TABLE>
* Please refer to the Appendix of the Statement of Additional Information for an
explanation of the credit ratings.
+ The cost of investments for federal tax purposes amounts to $42,055,953. The
net unrealized depreciation of investments on a federal tax basis amounts to
$3,349,997, which is comprised of $2,605 appreciation and $3,352,602
depreciation at November 30, 1994.
Note: The categories of investments are shown as a percentage of net assets
($39,663,729) at November 30, 1994.
111 CORCORAN NORTH CAROLINA MUNICIPAL
SECURITIES FUND
- --------------------------------------------------------------------------------
The following abbreviations are used in this portfolio:
<TABLE>
<S> <C>
AMBAC -- American Municipal Bond Assurance Corporation
COP -- Certificates of Participation
FGIC -- Financial Guaranty Insurance Co.
FSA -- Financial Security Assurance
GO -- General Obligation
MBIA -- Municipal Bond Investors Assurance
RIB -- Residual Interest Bond
</TABLE>
(See Notes which are an integral part of the Financial Statements)
111 CORCORAN NORTH CAROLINA MUNICIPAL
SECURITIES FUND
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 1994
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
ASSETS:
- --------------------------------------------------------------------------------
Investments in securities, at value (identified and tax cost $42,055,953) $38,705,956
- --------------------------------------------------------------------------------
Interest receivable 1,222,281
- --------------------------------------------------------------------------------
Receivable for investments sold 445,588
- --------------------------------------------------------------------------------
Receivable for Fund shares sold 48,700
- --------------------------------------------------------------------------------
Deferred expenses 11,850
- -------------------------------------------------------------------------------- -----------
Total assets 40,434,375
- --------------------------------------------------------------------------------
LIABILITIES:
- --------------------------------------------------------------------------------
Payable for Fund shares redeemed $601,274
- ---------------------------------------------------------------------
Dividends payable 151,627
- ---------------------------------------------------------------------
Accrued expenses 17,745
- --------------------------------------------------------------------- --------
Total liabilities 770,646
- -------------------------------------------------------------------------------- -----------
NET ASSETS for 4,197,866 shares of beneficial interest outstanding $39,663,729
- -------------------------------------------------------------------------------- -----------
NET ASSETS CONSIST OF:
- --------------------------------------------------------------------------------
Paid-in capital $43,557,179
- --------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) of investments (3,349,997)
- --------------------------------------------------------------------------------
Accumulated net realized gain (loss) on investments (543,453)
- -------------------------------------------------------------------------------- -----------
Total Net Assets $39,663,729
- -------------------------------------------------------------------------------- -----------
NET ASSET VALUE and Redemption Proceeds Per Share:
(net assets of $39,663,729 / 4,197,866 shares of beneficial interest
outstanding) $9.45
- -------------------------------------------------------------------------------- -----------
Computation of Offering Price (100/95.5 of $9.45) $9.90*
- -------------------------------------------------------------------------------- -----------
</TABLE>
* See "What Shares Cost" in the prospectus.
(See Notes which are an integral part of the Financial Statements)
111 CORCORAN NORTH CAROLINA MUNICIPAL
SECURITIES FUND
STATEMENT OF OPERATIONS
SIX MONTHS ENDED NOVEMBER 30, 1994
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
- --------------------------------------------------------------------------------
Interest income $ 1,211,567
- --------------------------------------------------------------------------------
EXPENSES--
- --------------------------------------------------------------------------------
Investment advisory fee $168,222
- ---------------------------------------------------------------------
Trustees' fees 1,388
- ---------------------------------------------------------------------
Administrative personnel and services fees 33,644
- ---------------------------------------------------------------------
Custodian fees 7,198
- ---------------------------------------------------------------------
Portfolio accounting, transfer and dividend disbursing agent fees
and expenses 47,118
- ---------------------------------------------------------------------
Fund share registration fees 9,956
- ---------------------------------------------------------------------
Auditing fees 8,148
- ---------------------------------------------------------------------
Legal fees 1,877
- ---------------------------------------------------------------------
Printing and postage 6,816
- ---------------------------------------------------------------------
Insurance premiums 2,963
- ---------------------------------------------------------------------
Miscellaneous 3,588
- --------------------------------------------------------------------- --------
Total expenses 290,918
- ---------------------------------------------------------------------
Deduct--waiver of investment advisory fee 168,222
- --------------------------------------------------------------------- --------
Net expenses 122,696
- -------------------------------------------------------------------------------- -----------
Net investment income 1,088,871
- -------------------------------------------------------------------------------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
- --------------------------------------------------------------------------------
Net realized gain (loss) on investments (identified cost basis) (534,713)
- --------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation) on investments (2,745,843)
- -------------------------------------------------------------------------------- -----------
Net realized and unrealized gain (loss) on investments (3,280,556)
- -------------------------------------------------------------------------------- -----------
Change in net assets resulting from operations ($2,191,685)
- -------------------------------------------------------------------------------- -----------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
111 CORCORAN NORTH CAROLINA MUNICIPAL
SECURITIES FUND
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED MAY 31,
--------------------------
1995* 1994
----------- -----------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
- ------------------------------------------------------------------
OPERATIONS--
- ------------------------------------------------------------------
Net investment income $ 1,088,871 $ 1,655,780
- ------------------------------------------------------------------
Net realized gain (loss) on investments ($534,713 net loss and
$30,153 net gain, respectively, as computed for federal tax
purposes) (534,713) 27,318
- ------------------------------------------------------------------
Net change in unrealized appreciation (depreciation) on
investments (2,745,843) (1,304,242)
- ------------------------------------------------------------------ ----------- -----------
Change in net assets resulting from operations (2,191,685) 378,856
- ------------------------------------------------------------------ ----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS--
- ------------------------------------------------------------------
Dividends to shareholders from net investment income (1,088,871) (1,656,604)
- ------------------------------------------------------------------
Distributions to shareholders from net realized gain on
investment transactions -- (29,434)
- ------------------------------------------------------------------ ----------- -----------
Change in net assets from distributions to shareholders (1,088,871) (1,686,038)
- ------------------------------------------------------------------ ----------- -----------
FUND SHARE (PRINCIPAL) TRANSACTIONS--
- ------------------------------------------------------------------
Proceeds from sale of shares 2,909,941 23,017,028
- ------------------------------------------------------------------
Net asset value of shares issued to shareholders in payment of
dividends declared 153,028 249,634
- ------------------------------------------------------------------
Cost of shares redeemed (5,983,088) (4,247,085)
- ------------------------------------------------------------------ ----------- -----------
Change in net assets from Fund share transactions (2,920,119) 19,019,577
- ------------------------------------------------------------------ ----------- -----------
Change in net assets (6,200,675) 17,712,395
- ------------------------------------------------------------------
NET ASSETS:
- ------------------------------------------------------------------
Beginning of period 45,864,404 28,152,009
- ------------------------------------------------------------------ ----------- -----------
End of period (including undistributed net investment income of
$0 and $0, respectively) $39,663,729 $45,864,404
- ------------------------------------------------------------------ ----------- -----------
</TABLE>
* Six months ended November 30, 1994 (unaudited).
(See Notes which are an integral part of the Financial Statements)
111 CORCORAN NORTH CAROLINA MUNICIPAL
SECURITIES FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
<TABLE>
<CAPTION>
YEAR ENDED MAY 31,
--------------------------------
1995* 1994 1993**
------ ------ ------
<S> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $10.17 $10.36 $10.00
- -------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS
- -------------------------------------------------------------------
Net investment income 0.24 0.47 0.37
- -------------------------------------------------------------------
Net realized and unrealized gain (loss) on investments (0.72) (0.18) 0.36
- ------------------------------------------------------------------- ------ ------ ------
Total from investment operations (0.48) 0.29 0.73
- -------------------------------------------------------------------
LESS DISTRIBUTIONS
- -------------------------------------------------------------------
Dividends to shareholders from net investment income (0.24) (0.47) (0.37)
- -------------------------------------------------------------------
Distributions to shareholders from net realized gain on
investment transactions -- (0.01) --
- ------------------------------------------------------------------- ------ ------ ------
Total distributions (0.24) (0.48) (0.37)
- ------------------------------------------------------------------- ------ ------ ------
NET ASSET VALUE, END OF PERIOD $ 9.45 $10.17 $10.36
- ------------------------------------------------------------------- ------ ------ ------
TOTAL RETURN*** (4.78%) 2.68% 7.37%
- -------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
- -------------------------------------------------------------------
Expenses 0.55%(b) 0.69% 0.70%(b)
- -------------------------------------------------------------------
Net investment income 4.85%(b) 4.42% 4.51%(b)
- -------------------------------------------------------------------
Expense waiver/reimbursement(a) 0.75%(b) 0.75% 0.99%(b)
- -------------------------------------------------------------------
SUPPLEMENTAL DATA
- -------------------------------------------------------------------
Net assets, end of period (000 omitted) $39,664 $45,864 $28,152
- -------------------------------------------------------------------
Portfolio turnover rate 24% 24% 17%
- -------------------------------------------------------------------
</TABLE>
* Six months ended November 30, 1994 (unaudited).
** Reflects operations for the period from July 22, 1992 (date of initial
public investment) to May 31, 1993.
*** Based on net asset value, which does not reflect the sales load or
contingent deferred sales charge, if applicable.
(a) This voluntary expense decrease is reflected in both the expense and net
investment income ratios shown above.
(b) Computed on an annualized basis.
(See Notes which are an integral part of the Financial Statements)
111 CORCORAN NORTH CAROLINA MUNICIPAL
SECURITIES FUND
NOTES TO FINANCIAL STATEMENTS
NOVEMBER 30, 1994
(UNAUDITED)
- --------------------------------------------------------------------------------
(1) ORGANIZATION
The 111 Corcoran Funds (the "Trust") is registered under the Investment Company
Act of 1940, as amended (the "Act"), as an open-end management investment
company. The Trust consists of one diversified portfolio and one non-diversified
portfolio. The financial statements included herein present only those of 111
Corcoran North Carolina Municipal Securities Fund (the "Fund"), a
non-diversified portfolio. The financial statements of the other portfolio are
presented separately. The assets of each portfolio are segregated and a
shareholder's interest is limited to the portfolio in which shares are held.
(2) SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. These
policies are in conformity with generally accepted accounting principles.
A. INVESTMENT VALUATIONS--Municipal bonds are valued by an independent pricing
service, taking into consideration yield, liquidity, risk, credit quality,
coupon, maturity, type of issue, and any other factors or market data it
deems relevant in determining valuations for normal institutional-size
trading units of debt securities. The independent pricing service does not
rely exclusively on quoted prices. Investments in other regulated investment
companies are valued at net asset value. Short-term securities with remaining
maturities of sixty days or less may be valued at amortized cost, which
approximates fair market value.
Since the Fund invests a substantial portion of its assets in issuers located
in one state, it will be more susceptible to factors adversely affecting
issuers of that state than would be a comparable general tax-exempt mutual
fund. In order to reduce the credit risk associated with such factors, at
November 30, 1994, 26.6% of the securities in the portfolio of investments
are backed by letters of credit or bond insurance of various financial
institutions and financial guaranty assurance agencies. The aggregate
percentages by financial institutions and agencies ranged from 0.8% to 13.6%
of total investments.
B. INVESTMENT INCOME, EXPENSES AND DISTRIBUTIONS--Interest income and expenses
are accrued daily. Bond premium and discount, if applicable, are amortized as
required by the Internal Revenue Code, as amended (the "Code"). Distributions
to shareholders are recorded on the ex-dividend date.
C. FEDERAL TAXES--It is the Fund's policy to comply with the provisions of the
Code applicable to regulated investment companies and to distribute to
shareholders each year substantially all of its
111 CORCORAN NORTH CAROLINA MUNICIPAL
SECURITIES FUND
- --------------------------------------------------------------------------------
tax-exempt income. Accordingly, no provisions for federal tax are necessary.
Additionally, net capital losses of $8,607 attributable to security
transactions incurred after October 31, 1993 are treated as arising on the
first day of the Fund's next taxable year.
D. WHEN-ISSUED AND DELAYED DELIVERY TRANSACTIONS--The Fund may engage in
when-issued or delayed delivery transactions. The Fund records when-issued
securities on the trade date and maintains security positions such that
sufficient liquid assets will be available to make payment for the securities
purchased. Securities purchased on a when-issued or delayed delivery basis
are marked to market daily and begin earning interest on the settlement date.
E. DEFERRED EXPENSES--The costs incurred by the Fund with respect to
registration of its shares in its first fiscal year, excluding the initial
expense of registering the shares, have been deferred and are being amortized
using the straight-line method not to exceed a period of five years from the
Fund's commencement date.
F. OTHER--Investment transactions are accounted for on the trade date.
(3) SHARES OF BENEFICIAL INTEREST
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value).
Transactions in Fund shares were as follows:
<TABLE>
<CAPTION>
YEAR ENDED MAY 31,
----------------------
1995* 1994
- ---------------------------------------------------------------------- -------- ---------
<S> <C> <C>
Shares sold 293,505 2,171,508
- ----------------------------------------------------------------------
Shares issued to shareholders in payment of dividends declared 15,497 23,762
- ----------------------------------------------------------------------
Shares redeemed (620,036) (402,568)
- ---------------------------------------------------------------------- -------- ---------
Net change resulting from Fund share transactions (311,034) 1,792,702
- ---------------------------------------------------------------------- -------- ---------
</TABLE>
* Six months ended November 30, 1994.
(4) INVESTMENT ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY FEE--Central Carolina Bank and Trust Company, the Fund's
investment Adviser (the "Adviser"), receives for its services an annual
investment advisory fee equal to .75 of 1% of the Fund's average daily net
assets. The Adviser may voluntarily choose to waive its fee. The Adviser can
modify or terminate this voluntary waiver at any time at its sole discretion.
ADMINISTRATIVE FEE--Federated Administrative Services ("FAS") provides the Fund
with certain administrative personnel and services. The FAS fee is based on the
level of average aggregate net assets of the Trust for the period. FAS may
voluntarily choose to waive a portion of its fee.
111 CORCORAN NORTH CAROLINA MUNICIPAL
SECURITIES FUND
- --------------------------------------------------------------------------------
TRANSFER AND DIVIDEND DISBURSING AGENT AND PORTFOLIO ACCOUNTING FEES--Federated
Services Company ("FServ") serves as transfer and dividend disbursing agent for
the Fund. The FServ fee is based on the size, type and number of accounts and
transactions made by shareholders.
FServ also maintains the Fund's accounting records. The fee is based on the
level of the Fund's average net assets for the period, plus out-of-pocket
expenses.
ORGANIZATIONAL EXPENSES--Organizational expenses ($43,033) were borne initially
by FAS. The Fund has agreed to reimburse FAS for the organizational expenses
during the five year period following the date the Fund first became effective.
For the six months ended November 30, 1994, the Fund paid $4,303 pursuant to
this agreement.
Certain of the Officers and Trustees of the Trust are Officers and Directors or
Trustees of the above companies.
(5) INVESTMENT TRANSACTIONS
Purchases and sales of investments, excluding short-term securities, for the six
months ended November 30, 1994 were as follows:
<TABLE>
<S> <C>
- -------------------------------------------------------------------------------
PURCHASES $10,443,488
- ------------------------------------------------------------------------------- -----------
SALES $11,967,138
- ------------------------------------------------------------------------------- -----------
</TABLE>
<TABLE>
<S> <C>
TRUSTEES OFFICERS
- ---------------------------------------------------------------------------------------------
John F. Donahue John F. Donahue
Thomas G. Bigley Chairman
John T. Conroy, Jr. Edward C. Gonzales
William J. Copeland President and Treasurer
James E. Dowd J. Christopher Donahue
Lawrence D. Ellis, M.D. Vice President
Edward L. Flaherty, Jr. Richard B. Fisher
Edward C. Gonzales Vice President
Peter E. Madden Joseph S. Machi
Gregor F. Meyer Vice President and Assistant Treasurer
Wesley W. Posvar John W. McGonigle
Marjorie P. Smuts Vice President and Secretary
David M. Taylor
Assistant Treasurer
C. Grant Anderson
Assistant Secretary
</TABLE>
Mutual funds are not bank deposits or obligations, are not guaranteed by any
bank, and are not insured or guaranteed by the U.S. government, the Federal
Deposit Insurance Corporation, the Federal Reserve Board, or any other
government agency. Investment in mutual funds involves investment risk,
including possible loss of principal.
This report is authorized for distribution to prospective investors only when
preceded or accompanied by the Fund's prospectus which contains facts concerning
its objective and policies, management fees, expenses and other information.
