ANNUAL
..............................................................................
FINANCIAL REPORT
..............................................................................
STI CLASSIC FUNDS
..............................................................................
A Family of Mutual Funds
..............................................................................
CLASSIC INSTITUTIONAL CASH MANAGEMENT MONEY MARKET FUND
CLASSIC INSTITUTIONAL U.S. GOVERNMENT SECURITIES MONEY MARKET FUND
CLASSIC INSTITUTIONAL U.S. TREASURY SECURITIES MONEY MARKET FUND
May 31, 2000
(LOGO) [GRAPHIC OMITTED]
<PAGE>
Dear Valued STI Classic Trust Shareholder:
The period corresponding to the STI Classic Funds' fiscal year ending May 31,
2000 is perhaps one of the most unusual in the history of modern financial
markets. The U.S. economy continued on its growth path, extending the longest
period of uninterrupted expansion. In fact, economic growth actually
accelerated, prompting the Federal Reserve (the "Fed") to announce a series of
rate increases. The capital markets responded by rewarding risk in equity
securities and punishing it in fixed income markets. On the equity side,
technology stocks were prominent, as evidenced by the 37.7% rise in the NASDAQ
Composite Index and even greater 59.1% appreciation in the larger stocks of the
NASDAQ 100 Index. Small cap stocks did well, predominantly because of technology
and biotechnology stocks; the S&P 600 Small Cap Index rose 14.2%. Mid-cap stocks
did even better, with the S&P 400 Mid-Cap Index up 21.5%, but again due to
technology. Overall, many stocks did not do well as Fed tightening weighed
heavily on performance. The broader S&P 500 Composite Index was up a more modest
10.5%, while the Dow Jones Industrial Average only achieved a 1.2% positive
return. Within style categories, growth stocks enjoyed a record advantage over
value stocks, a condition which began to reverse only in the last three months
of the STI Classic Funds fiscal year.
On the fixed income side, total returns in bonds were modest, as typified by the
1.9% gain in the Lehman U.S. Government/Corporate Bond Index for longer term
taxable bonds, the 3.5% return in the Merrill Lynch 1-5 Year U.S.
Corporate/Government Index, and very modest returns in short to
intermediate-term municipal bonds. Within the bond arena, investment grade and
high yield bonds were under pressure, while top quality Government bonds
prospered. There was a disconnect between risk/reward as equity investors were
very positive and bond investors were negative.
As the new fiscal year begins for the STI Classic Fund family, we are encouraged
by the broadening out of the equity market. Technology stocks have recently
corrected significantly and small and mid-caps have done better. Importantly,
value oriented stocks outperformed in March/April/May. Tight Fed policy and
rising money market rates due to rapid economic growth are not good for stocks.
Thus, recent signs of slower economic growth are welcome and stocks will do
better once the Fed suspends its tight monetary stance. We also believe the very
wide yield spreads available in non-Government fixed income securities will
prove rewarding over the next 12-24 months. The STI Classic Funds have never
been stronger in terms of product breadth and potential for long-term growth. We
thank all Fund shareholders for their confidence in the STI Classic Family. We
will work hard to deliver competitive results in the months and years ahead.
Sincerely
/s/signature omitted
Douglas S. Phillips
President and Chief Investment Officer
Trusco Capital Management, Inc.
1
<PAGE>
STATEMENT OF NET ASSETS
-------------------------------------------------------------------------------
STI CLASSIC FUNDS MAY 31, 2000
CLASSIC INSTITUTIONAL CASH MANAGEMENT MONEY MARKET FUND
-------------------------------------------------------------------------------
FACE
AMOUNT (000)VALUE (000)
-------------------------------------------------------------------------------
COMMERCIAL PAPER (22.0%)
FINANCE (2.2%)
Sigma Finance
5.750%, 07/20/00 $25,000 $ 25,000
7.400%, 05/25/01 25,000 25,000
----------
50,000
----------
INDUSTRIAL (2.8%)
DaimlerChrysler
6.040%, 06/21/00 30,000 29,899
General Electric Capital
5.730%, 08/01/00 35,000 34,660
----------
64,559
----------
INVESTMENT BANKERS/BROKER DEALERS (8.4%)
Bear Stearns
6.100%, 06/01/00 40,000 40,000
Credit Suisse First Boston
5.750%, 07/14/00 25,000 25,000
6.200%, 07/25/00 30,000 29,721
Morgan Stanley Dean Witter (B)
6.880%, 06/01/00 50,000 50,000
6.880%, 06/01/00 50,000 50,000
----------
194,721
----------
PERSONAL CREDIT INSTITUTIONS (8.6%)
Ford Motor Credit
6.410%, 06/28/00 100,000 99,519
GMAC
6.070%, 06/28/00 30,000 29,863
6.150%, 07/12/00 70,000 69,510
----------
198,892
----------
Total Commercial Paper
(Cost $508,172) 508,172
----------
CORPORATE OBLIGATIONS (44.7%)
BANKS (13.8%)
AmSouth Bank (B)
6.850%, 06/01/00 50,000 49,986
------------------------------------------------------------------------------
FACE
AMOUNT (000) VALUE (000)
------------------------------------------------------------------------------
BANKS--CONTINUED
Branch Banking & Trust (B)
6.870%, 06/01/00 $40,000 $ 40,000
6.880%, 06/01/00 35,000 34,989
Canadian Imperial Bank
7.070%, 05/03/01 40,000 39,997
First Union (B)
6.870%, 06/01/00 50,000 50,000
6.910%, 06/01/00 25,000 25,000
Key Bank (B)
6.910%, 06/01/00 39,000 38,998
Wachovia Bank, MTN (B)
6.119%, 06/05/00 40,000 39,997
----------
318,967
----------
ENTERTAINMENT (3.2%)
Tampa Bay Devil Rays (A) (B)
6.710%, 06/01/00 50,745 50,745
Walt Disney (A)
4.200%, 03/15/01 25,000 24,525
----------
75,270
----------
FINANCE (8.9%)
Beneficial, MTN (B)
6.181%, 06/01/00 10,000 10,000
Beta Finance, MTN
5.520%, 06/12/00 25,000 25,000
Beta Finance, MTN (B)
6.805%, 06/07/00 30,000 30,000
7.010%, 08/16/00 30,000 30,000
Household Finance, MTN (B)
7.050%, 06/01/00 30,000 29,995
Sigma Finance (A)
6.570%, 01/10/01 20,000 20,000
Sigma Finance, MTN
6.800%, 03/30/01 30,000 30,000
UBS Finance
6.475%, 01/08/01 30,000 29,994
----------
204,989
----------
2
<PAGE>
-----------------------------------------------------------------------------
FACE
AMOUNT (000) VALUE (000)
-----------------------------------------------------------------------------
INDUSTRIAL (1.7%)
Anheuser Busch (B)
6.440%, 06/16/00 $40,000 $ 39,999
----------
INVESTMENT BANKERS/BROKER DEALERS (15.8%)
Bear Stearns
6.500%, 07/05/00 25,000 25,008
Bear Stearns, MTN (B)
6.900%, 06/01/00 40,000 40,000
6.910%, 06/01/00 35,000 35,000
Credit Suisse First Boston,
MTN (A)
5.590%, 06/08/00 10,000 10,000
Credit Suisse First Boston,
MTN (A) (B)
6.900%, 06/01/00 35,000 35,000
Goldman Sachs, MTN,
Ser B (B)
7.080%, 06/01/00 30,000 30,013
Goldman Sachs, MTN
6.100%, 09/25/00 30,000 30,000
6.500%, 12/22/00 20,000 20,000
JP Morgan, MTN (B)
6.281%, 06/03/00 40,000 40,000
Merrill Lynch, MTN
6.735%, 02/28/01 25,000 24,997
7.260%, 05/15/01 50,000 49,995
Merrill Lynch, MTN (B)
6.985%, 06/01/00 25,000 24,999
----------
365,012
----------
LEASING COMPANY (1.3%)
Xerox Credit, MTN
5.635%, 07/14/00 30,000 29,999
----------
Total Corporate Obligations
(Cost $1,034,236) 1,034,236
----------
-------------------------------------------------------------------------------
FACE
AMOUNT (000) VALUE (000)
-------------------------------------------------------------------------------
CERTIFICATES OF DEPOSIT (8.4%)
Albertson's (A) (B)
6.503%, 06/14/00 $40,000 $ 39,998
Canadian Imperial Bank
6.670%, 02/12/01 40,000 39,987
First USA Bank
6.040%, 08/04/00 40,000 40,000
Royal Bank of Canada
6.180%, 10/25/00 35,000 34,991
6.470%, 01/10/01 40,000 39,988
----------
Total Certificates of Deposit
(Cost $194,964) 194,964
----------
TAXABLE MUNICIPAL BONDS (2.4%)
California Housing Finance Agency,
MBIA (B)
6.650%, 08/01/00 31,715 31,715
Mt. Vernon Multi-Family
Housing Notes (B)
6.700%, 07/01/00 23,000 23,000
----------
Total Taxable Municipal Bonds
(Cost $54,715) 54,715
----------
U.S. AGENCY MORTGAGE-BACKED OBLIGATIONS (5.2%)
FHLB (B)
6.168%, 06/07/00 50,000 50,000
FHLMC, MTN
6.255%, 01/12/01 20,000 19,983
FNMA, MTN, Ser B
6.320%, 02/02/01 50,000 49,968
----------
Total U.S. Agency Mortgage-Backed Obligations
(Cost $119,951) 119,951
----------
3
<PAGE>
STATEMENT OF NET ASSETS
-------------------------------------------------------------------------------
STI CLASSIC FUNDS MAY 31, 2000
CLASSIC INSTITUTIONAL CASH MANAGEMENT MONEY MARKET FUND--CONCLUDED
------------------------------------------------------------------------------
FACE
AMOUNT (000) VALUE (000)
------------------------------------------------------------------------------
BANK NOTES (3.5%)
American Express Centurion (B)
6.910%, 06/01/00 $35,000 $ 35,000
Branch Banking and Trust (B)
7.010%, 06/05/00 20,000 20,000
FCC National Bank
6.065%, 08/14/00 25,000 24,998
----------
Total Bank Notes
(Cost $79,998) 79,998
----------
REPURCHASE AGREEMENTS (10.2%)
ABN-Amro
6.440%, dated 05/31/00, matures
06/01/00, repurchase price
$63,011,270 (collateralized by
various FHLMC obligations: total
market value $64,260,000) (C) 63,000 63,000
Barclays
6.440%, dated 05/31/00, matures
06/01/00, repurchase price
$62,705,360 (collateralized by a
FNMA and SLMA obligations: total
market value $63,948,043) (C) 62,694 62,694
Deutsche Bank
6.440%, dated 05/31/00, matures
06/01/00, repurchase price
$42,016,473 (collateralized by a
FNMA obligation: total market
value $42,849,138) (C) 42,009 42,009
Merrill Lynch
6.440%, dated 05/31/00, matures
06/01/00, repurchase price
$30,618,206 (collateralized by
various FNMA obligations: total
market value $31,227,271) (C) 30,613 30,613
-------------------------------------------------------------------------------
SHARES/FACE
AMOUNT (000) VALUE (000)
-------------------------------------------------------------------------------
REPURCHASE AGREEMENTS--CONTINUED
Warburg Dillon
6.440%, dated 05/31/00, matures
06/01/00, repurchase price
$37,487,902 (collateralized by a
U.S. Treasury Note: total market
value 38,233,442) (C) $37,481 $ 37,481
----------
Total Repurchase Agreements
(Cost $235,797) 235,797
----------
CASH EQUIVALENT (4.3%)
Aim Liquid Assets Fund 100,000,000 100,000
----------
Total Cash Equivalent
(Cost $100,000) 100,000
----------
Total Investments (100.7%)
(Cost $2,327,833) 2,327,833
----------
OTHER ASSETS AND LIABILITIES, NET (-0.7%) (16,148)
----------
NET ASSETS:
Fund shares of Institutional Shares
(unlimited authorization -- no par value
based on 2,312,249,074 outstanding
shares of beneficial interest 2,312,249
Distributions in excess of net
investment income (565)
Accumulated net realized gain
on investments 1
----------
Total Net Assets (100.0%) $2,311,685
==========
Net Asset Value, Offering Redemption
Price Per Share -- Institutional Shares $ 1.00
==========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 9.
4
<PAGE>
-------------------------------------------------------------------------------
CLASSIC INSTITUTIONAL U.S. GOVERNMENT SECURITIES MONEY MARKET FUND
-------------------------------------------------------------------------------
FACE
AMOUNT (000 VALUE (000)
-------------------------------------------------------------------------------
U.S. AGENCY MORTGAGE-BACKED OBLIGATIONS (77.8%)
FHLB
5.810%, 09/15/00 $20,000 $ 19,677
5.965%, 12/01/00 20,000 19,982
4.950%, 12/04/00 20,000 19,868
6.580%, 02/09/01 15,000 15,000
FHLB (B)
6.083%, 09/01/00 35,000 35,000
6.750%, 09/22/00 40,000 39,996
6.168%, 12/20/00 50,000 50,000
FHLMCDN
6.090%, 07/13/00 35,000 34,751
6.115%, 03/16/01 15,000 14,266
6.730%, 05/24/01 15,000 13,999
FNMA
7.000%, 05/17/01 15,000 15,004
FNMA, MTN
5.460%, 06/21/00 30,000 29,999
6.445%, 02/23/01 10,00 09,989
6.625%, 03/01/01 15,000 14,999
FNMA, MTN (B)
6.770%, 09/29/00 50,000 49,995
6.735%, 11/06/00 25,000 24,990
6.449%, 11/22/00 30,000 29,989
FNMADN
5.785%, 07/07/00 20,000 19,890
5.485%, 08/11/00 20,000 19,785
5.900%, 10/06/00 20,000 19,606
6.700%, 05/10/01 10,000 9,362
-------
Total U.S. Agency Mortgage-Backed Obligations
(Cost $506,147) 506,147
--------
------------------------------------------------------------------------------
FACE
AMOUNT (000) VALUE (000)
------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (21.8%)
ABN-Amro
6.470%, dated 05/31/00, matures
06/01/00, repurchase price
$106,987,008 (collateralized by
various FNMA and FHLMC
obligations: total market value
$109,107,139) (C) $106,968 $106,968
Deutsche Bank 6.470%, dated
05/31/00, matures 06/01/00,
repurchase price $12,019,620
(collateralized by a FNMA
obligation: total market value
$12,257,810) (C) 12,017 12,017
Greenwich Capital
6.470%, dated 05/31/00, matures
06/01/00, repurchase price
$18,760,082 (collateralized by
various GNMA obligations: total
market value $19,132,971) (C) 18,757 18,757
JP Morgan
6.470%, dated 05/31/00, matures
06/01/00, repurchase price
$4,232,698 (collateralized by a
GNMA obligation: total market
value $4,316,577) (C) 4,232 4,232
-------
Total Repurchase Agreements
(Cost $141,974) 141,974
--------
Total Investments (99.6%)
(Cost $648,121) 648,121
--------
OTHER ASSETS AND LIABILITIES, NET (0.4%) 2,505
--------
5
<PAGE>
STATEMENT OF NET ASSETS
-------------------------------------------------------------------------------
STI CLASSIC FUNDS MAY 31, 2000
CLASSIC INSTITUTIONAL U.S. GOVERNMENT SECURITIES MONEY MARKET FUND--CONCLUDED
-------------------------------------------------------------------------------
VALUE (000)
-------------------------------------------------------------------------------
NET ASSETS:
Fund shares of Institutional Shares (unlimited
authorization -- no par value) based on
650,651,141 outstanding shares of beneficial
interest $650,651
Accumulated net realized loss
on investments (25)
--------
Total Net Assets (100.0%) $650,626
========
Net Asset Value, Offering and Redemption
Price Per Share -- Institutional Shares $ 1.00
========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF
THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF
ABBREVIATIONS, PLEASE SEE PAGE 9.
6
<PAGE>
-------------------------------------------------------------------------------
CLASSIC INSTITUTIONAL U.S. TREASURY SECURITIES MONEY MARKET FUND
-------------------------------------------------------------------------------
FACE
AMOUNT (000) VALUE (000)
-------------------------------------------------------------------------------
U.S. TREASURY OBLIGATIONS (19.8%)
U.S. Treasury Bills
5.980%, 08/10/00 $ 75,000 $ 74,216
5.605%, 10/12/00 190,000 186,051
U.S. Treasury Note
5.000%, 02/28/0 30,000 29,704
---------
Total U.S. Treasury Obligations
(Cost $289,971 289,971
---------
REPURCHASE AGREEMENTS (76.2%)
ABN-Amro
6.310%, dated 05/31/00, matures
06/01/00, repurchase price
$340,530,770 (collateralized by
various U.S. Treasury Notes and
U.S. Treasury Bonds: total market
value $347,289,622) (C) 340,471 340,471
Barclays
6.310%, dated 05/31/00, matures
06/01/00, repurchase price
$64,893,233 (collateralized by a
U.S. Treasury Bond: total market
value $66,180,031) (C) 64,882 64,882
Duetsche Bank
6.310%, dated 05/31/00, matures
06/01/00, repurchase price
$64,418,025 (collateralized by
various U.S. Treasury Bonds:
total market value
$65,695,776) (C) 64,407 64,407
Greenwich Capital
6.310%, dated 05/31/00, matures
06/01/00, repurchase price
$340,553,316 (collateralized by
various U.S. Treasury Notes and
U.S. Treasury Bonds: total market
value $347,305,585) (C) 340,494 340,494
--------------------------------------------------------------------------------
FACE
AMOUNT (000) VALUE (000)
--------------------------------------------------------------------------------
REPURCHASE AGREEMENTS--CONTINUED
JP Morgan
6.310%, dated 05/31/00, matures
06/01/00, repurchase price
$49,842,397 (collateralized
by a U.S. Treasury Note: total
market value $50,830,553) (C) $49,834 $ 49,834
Merrill Lynch
6.310%, dated 05/31/00, matures
06/01/00, repurchase price
$64,975,703 (collateralized by a
U.S. Treasury Bond: total market
value $66,263,648) (C) 64,964 64,964
Morgan Stanley Dean Witter
6.310%, dated 05/31/00, matures
06/01/00, repurchase price
$64,267,065 (collateralized by
various U.S. Treasury Notes
and U.S. Treasury Bonds: total
market value $65,659,713) (C) 64,256 64,256
Salomon Smith Barney
6.310%, dated 05/31/00, matures
06/01/00, repurchase price
$64,772,503 (collateralized by
various U.S. Treasury Bonds: total
market value $66,064,316) (C) 64,761 64,761
Warburg Dillon
6.310%, dated 05/31/00, matures
06/01/00, repurchase price
$64,487,731 (collateralized by a
U.S. Treasury Note: total market
value $65,768,430) (C) 64,476 64,476
---------
Total Repurchase Agreements
(Cost $1,118,545) 1,118,545
---------
7
<PAGE>
STATEMENT OF NET ASSETS
---------------------------------------------------------
STI CLASSIC FUNDS MAY 31, 2000
CLASSIC INSTITUTIONAL U.S. TREASURY SECURITIES
MONEY MARKET FUND--CONCLUDED
---------------------------------------------------------
SHARES VALUE (000)
---------------------------------------------------------
CASH EQUIVALENT (4.4%)
AIM Institutional Treasury
Fund 65,000,000 $ 65,000
----------
Total Cash Equivalent
(Cost $65,000) 65,000
----------
Total Investments (100.4%)
(Cost $1,473,516) 1,473,516
----------
OTHER ASSETS AND LIABILITIES, NET (-0.4%) (5,250)
----------
NET ASSETS:
Fund shares of Institutional Shares
(unlimited authorization -- no par value)
based on 329,699,333 outstanding shares of
beneficial interest 329,699
Fund shares of Corporate Trust Shares
(unlimited authorization -- no par value)
based on 1,138,531,073 outstanding shares
of beneficial interest 1,138,531
Undistributed net investment income 36
----------
Total Net Assets (100.0%) $1,468,266
==========
Net Asset Value, Offering and Redemption
Price Per Share -- Institutional Shares $ 1.00
==========
Net Asset Value, Offering and Redemption
Price Per Share -- Corporate Trust Shares $ 1.00
==========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 9.
8
<PAGE>
-------------------------------------------------------------------------------
KEY TO ABBREVIATIONS USED IN THE
STATEMENT OF NET ASSETS
FHLB Federal Home Loan Bank
FHLMC Federal Home Loan Mortgage Corporation
FHLMCDN Federal Home Loan Mortgage Corporation Discount Note
FNMA Federal National Mortgage Association
FNMADN Federal National Mortgage Association Discount Note
GNMA Government National Mortgage Association
MBIA Security insured by the Municipal Bond Investors Assurance
Corporation
MTN Medium Term Note
Ser Series
SLMA Student Loan Marketing Association
(A) Private Placement Security
(B) Adjustable Rate Security. The rate reported on the Statement of Net
Assets is the rate in effect on May 31,2000. The date shown is the
next scheduled reset date.
(C) Tri-Party Repurchase Agreement
9
This page intentionally left blank.
<PAGE>
<TABLE>
STATEMENTS OF OPERATIONS (000)
---------------------------------------------------------------------------------------------------------------------------
STI CLASSIC FUNDS FOR THE YEAR ENDED MAY 31, 2000
CLASSIC CLASSIC CLASSIC
INSTITUTIONAL INSTITUTIONAL INSTITUTIONAL
CASH MANAGEMENT U.S. GOVERNMENT U.S. TREASURY
MONEY MARKET SECURITIES MONEY SECURITIES MONEY
FUND MARKET FUND MARKET FUND
-------------- ----------------------------------
06/01/99- 06/01/99- 06/01/99-
05/31/00 05/31/00 05/31/00
---------- --------- ----------
<S> <C> <C> <C>
Income:
Interest Income $124,453 $37,419 $74,129
-------- ------- -------
Expenses:
Investment Advisory Fees ............................. 4,393 1,355 2,746
Less: Investment Advisory Fees Waived ................ (679) (181 (305)
Administrator Fees ................................... 1,554 486 972
Less: Administrator Fees Waived ...................... (439) (121) (275)
Transfer Agent Fees - Institutional Shares ........... 5 16 14
Transfer Agent Fees - Corporate Trust Shares ......... -- -- 15
Transfer Agent Out of Pocket Expenses ................ 156 40 1
Printing Fees ........................................ 153 43 39
Custody Fees ......................................... 102 10 7
Professional Fees .................................... 134 30 35
Trustee Fees ......................................... 21 6 5
Registration Fees .................................... 58 14 145
Shareholder Service Fee .............................. -- -- 2,182
Insurance and Other Fees ............................. 40 -- 3
--------- ------- -------
Total Expenses ....................................... 5,498 1,698 5,584
--------- ------- -------
Net Investment Income ................................ 118,955 35,721 68,545
--------- ------- -------
Net Realized Gain on Securities Sold ................. -- -- 3
--------- ------- -------
Increase in Net Assets Resulting from Operation ...... $118,955 $35,721 $68,548
========= ======= =======
Amounts designated as "--" are either $0 or round to $0.
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE
FINANCIAL STATEMENTS.
11
<PAGE>
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS (000)
---------------------------------------------------------------------------------------------------------------------------
STI CLASSIC FUNDS FOR THE PERIODS ENDED MAY 31, AND JANUARY 31,
CLASSIC CLASSIC CLASSIC
INSTITUTIONAL INSTITUTIONAL INSTITUTIONAL
CASH MANAGEMENT U.S. GOVERNMENT U.S. TREASURY
MONEY MARKET SECURITIES MONEY SECURITIES MONEY
FUND MARKET FUND MARKET FUND
-------------------------------- ----------------------------- ---------------------
06/01/99- 02/01/99- 02/01/98- 06/01/99- 02/01/99- 02/01/98- 06/01/99- 06/01/98-
05/31/00 05/31/99 01/31/99 05/31/00 05/31/99 01/31/99 05/31/00 05/31/99
--------- --------- --------- -------- --------- --------- --------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Operations:
Net Investment Income $ 118,955 $ 15,177 $ 42,861 $ 35,721 $ 10,264 $ 34,235 $ 68,545 $ 10,844
Net Realized Gain
on Investments -- 1 -- -- -- -- 3 25
---------- ---------- ---------- ---------- ---------- --------- ---------- ----------
Increase in Net Assets
from Operations 118,955 15,178 42,861 35,721 10,264 34,235 68,548 10,869
---------- ---------- ---------- ---------- ---------- --------- ---------- ----------
Distributions to Shareholders:
Net Investment Income:
Institutional Shares (119,528) (15,172) (42,874) (35,721) (10,249) (34,250) (14,676) (10,842)
Corporate Trust Shares -- -- -- -- -- -- (53,866) --
---------- ---------- ---------- ---------- ---------- --------- ---------- ----------
Total Distributions (119,528) (15,172) (42,874) (35,721) (10,249) (34,250) (68,542) (10,842)
---------- ---------- ---------- ---------- ---------- --------- ---------- ----------
Capital Transactions (1):
Institutional Shares:
Proceeds from
Shares Issued 7,310,322 2,243,802 7,764,540 1,986,992 1,958,641 6,897,369 1,631,329 1,267,762
Shares Issued in
Connection with Crestar
Arbor Merger -- 1,072,229 -- -- -- -- -- --
Reinvestments of
Cash Distributions 76,132 7,086 10,074 12,023 3,113 13,467 14,668 7,876
Cost of Shares
Repurchased (6,962,679)(2,319,130)(7,630,948) (1,965,478)(2,032,711)(7,012,200)(1,599,793)(1,132,474)
---------- ---------- ---------- ---------- ---------- --------- ---------- ----------
Increase (Decrease) in
Net Assets from
Institutional Share
Transactions 423,775 1,003,987 143,666 33,537 (70,957) (101,364) 46,204 143,164
---------- ---------- ---------- ---------- ---------- --------- ---------- ----------
Corporate Trust Shares:
Proceeds from
Shares Issued -- -- -- -- -- -- 3,577,647 --
Cost of Shares Repurchased -- -- -- -- -- (2,439,116) --
---------- ---------- ---------- ---------- ---------- --------- ---------- ----------
Increase in Net Assets
from Corporate
Trust Share
Transactions -- -- -- -- -- -- 1,138,531 --
---------- ---------- ---------- ---------- ---------- --------- ---------- ----------
Increase (Decrease) in
Net Assets from Share
Transactions 423,775 1,003,987 143,666 33,537 (70,957) (101,364) 1,184,735 143,164
---------- ---------- ---------- ---------- ---------- --------- ---------- ----------
Total Increase (Decrease)
in Net Assets 423,202 1,003,993 143,653 33,537 (70,942) (101,379) 1,184,741 143,191
---------- ---------- ---------- ---------- ---------- --------- ---------- ----------
Net Assets:
Beginning of Period 1,888,483 884,490 740,837 617,089 688,031 789,410 283,525 140,334
---------- ---------- ---------- ---------- ---------- --------- ---------- ----------
End of Period $2,311,685 $1,888,483 $ 884,490 $ 650,626 $ 617,089 $ 688,031 $1,468,266 $ 283,525
========== ========== ========== ========== ========== ========= ========== ==========
</TABLE>
12
<PAGE>
<TABLE>
-----------------------------------------------------------------------------------------------------------------------
CLASSIC CLASSIC CLASSIC
INSTITUTIONAL INSTITUTIONAL INSTITUTIONAL
CASH MANAGEMENT U.S. GOVERNMENT U.S. TREASURY
MONEY MARKET SECURITIES MONEY SECURITIES MONEY
FUND MARKET FUND MARKET FUND
------------------------------- ------------------------------ ---------------------
06/01/99- 02/01/99- 02/01/98- 06/01/99- 02/01/99- 02/01/98- 06/01/99- 06/01/98-
05/31/00 05/31/99 01/31/99 05/31/00 05/31/99 01/31/99 05/31/00 05/31/99
---------- --------- --------- --------- --------- --------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
(1) Shares Issued and Redeemed:
Institutional Shares:
Shares Issued 7,310,322 2,243,802 7,764,540 1,986,991 1,958,641 6,897,369 1,631,329 1,267,762
Shares Issued in
Connection with
Crestar Arbor Merger -- 1,072,211 -- -- -- -- -- --
Shares Issued in Lieu
of Cash Distributions 76,132 7,086 10,074 12,023 3,113 13,467 14,668 7,876
Shares Redeemed (6,962,679)(2,319,131)(7,630,948) (1,965,478)(2,032,711)(7,012,200)(1,599,793) (1,132,474)
---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Net Institutional
Share Transactions 423,775 1,003,968 143,666 33,536 (70,957) (101,364) 46,204 143,164
---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Corporate Trust Shares:
Shares Issued -- -- -- -- -- -- 3,577,647 --
Shares Redeemed -- -- -- -- -- -- (2,439,116) --
---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Net Corporate Trust
Share Transactions -- -- -- -- -- -- 1,138,531 --
---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Net Change in Capita
Shares 423,775 1,003,968 143,666 33,536 (70,957) (101,364) 1,184,735 143,164
========== ========== ========== ========== ========== ========== ========== ==========
Amounts designated as "--" are either $0 or round to $0.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE
FINANCIAL STATEMENTS.
</TABLE>
13
<PAGE>
<TABLE>
FINANCIAL HIGHLIGHTS
---------------------------------------------------------------------------------------------------------------
STI CLASSIC FUNDS FOR THE PERIODS ENDED MAY 31, (UNLESS OTHERWISE NOTED)
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
NET NET ASSET
NET ASSET VALUE INVESTMENT DISTRIBUTIONS FROM VALUE END TOTAL
BEGINNING OF PERIOD INCOME NET INVESTMENT INCOME OF PERIOD RETURN+
---------------------- ----------- ---------------------- ----------- ---------
CLASSIC INSTITUTIONAL CASH MANAGEMENT MONEY MARKET FUND (A)
Institutional Shares
<S> <C> <C> <C> <C> <C>
2000 $1.00 $0.05 $(0.05) $1.00 5.56%
1999* 1.00 0.02 (0.02) 1.00 1.58
For the years ended January 31:
1999 1.00 0.05 (0.05) 1.00 5.46
1998 1.00 0.06 (0.06 1.00 5.66
1997 1.00 0.05 (0.05) 1.00 5.45
1996(B) 1.00 0.02 (0.02) 1.00 1.42
CLASSIC INSTITUTIONAL U.S. GOVERNMENT SECURITIES MONEY MARKET FUND (C)
Institutional Shares
2000 $1.00 $0.05 $(0.05) $1.00 5.39%
1999 1.00 0.02 (0.02 1.00 1.56
For the years ended January 31:
1999 1.00 0.05 (0.05) 1.00 5.30
1998 1.00 0.05 (0.05) 1.00 5.52
1997 1.00 0.05 (0.05) 1.00 5.29
199 1.00 0.05 (0.06) 1.00 5.88
CLASSIC INSTITUTIONAL U.S. TREASURY SECURITIES MONEY MARKET FUND
Institutional Shares
2000 $1.00 $0.05 $(0.05) $1.00 5.25%
1999 1.00 0.05 (0.05) 1.00 4.97
1998 1.00 0.05 (0.05) 1.00 5.50
1997(D) 1.00 0.02 (0.02) 1.00 2.46
Corporate Trust Shares
2000 (E) $1.00 $0.05 $(0.05) $1.00 5.02%
(A) On May 17, 1999, the Arbor Prime Obligations Fund exchanged all of its
assets and certain liabilities for shares of the Classic Institutional Cash
Management Money Market Fund. The Arbor Prime Obligations Fund is the accounting
survivor in this transaction, and as a result, its basis of accounting for
assets and liabilities and its operating results for the periods prior to May
17, 1999 have been carried forward in these financial highlights.
(B) Commenced operations on October 25, 1995. All ratios for the period have been annualized.
(C) On May 24, 1999, the Arbor U.S. Government Securities Money Fund exchanged
all of its assets and certain liabilities for shares of the Classic
Institutional U.S. Government Securities Money Market Fund. The Arbor U.S.
Government Securities Money Fund is the accounting survivor in this transaction,
and as a result, its basis of accounting for assets and liabilities and its
operating results for the periods prior to May 24, 1999 have been carried
forward in these financial highlights.
</TABLE>
14
<PAGE>
<TABLE>
------------------------------------------------------------------------------------------------
RATIO OF
RATIO OF NET INVESTMENT
RATIO OF EXPENSES TO INCOME TO
NET ASSETS RATIO OF NET INVESTMENT AVERAGE NET ASSETS AVERAGE NET ASSETS
END OF EXPENSES TO INCOME TO (EXCLUDING WAIVERS (EXCLUDING WAIVERS
PERIOD (000) AVERAGE NET ASSETS AVERAGE NET ASSETS AND REIMBURSEMENTS) AND REIMBURSEMENTS)
------------ ------------------ ------------------ ------------------- -------------------
<S> <C> <C> <C> <C> <C>
$2,311,685 0.25% 5.42% 0.30% 5.37%
1,888,483 0.25 4.79 0.35 4.69
884,490 0.23 5.31 0.35 5.19
740,837 0.20 5.52 0.36 5.36
477,435 0.20 5.33 0.38 5.15
382,632 0.20 5.61 0.40 5.41
$ 650,626 0.25% 5.27% 0.29% 5.23%
617,089 0.25 4.73 0.36 4.62
688,031 0.23 5.18 0.36 5.05
789,410 0.20 5.39 0.37 5.22
586,731 0.20 5.17 0.37 5.00
514,870 0.20 5.72 0.37 5.55
$ 329,725 0.25% 5.17% 0.31% 5.11%
283,525 0.20 4.83 0.47 4.56
140,334 0.18 5.34 0.38 5.14
20,238 0.09 5.27 0.51 4.85
$1,138,541 0.45% 4.93% 0.49% 4.89%
(D) Commenced operations on December 12, 1996. All ratios for the period have
been annualized.
(E) Commenced operations on June 3, 1999. All ratios for the
period have been annualized.
+ Returns are for the period indicated and have not been annualized.
* For the period February 1, 1999 to May 31, 1999. All ratios for the period have been annualized.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
</TABLE>
15
<PAGE>
NOTES TO FINANCIAL STATEMENTS
-------------------------------------------------------------------------------
STI CLASSIC FUNDS MAY 31, 2000
1. Organization:
The STI Classic Funds (the "Trust") was organized as a Massachusetts business
trust under a Declaration of Trust dated January 15, 1992. The Trust is
registered under the Investment Company Act of 1940, as amended, as an open-end
management investment company with thirty-five funds as of May 31, 2000: the
Balanced Fund, the Capital Appreciation Fund (formerly the Capital Growth Fund),
the Core Equity Fund, the E-Commerce Opportunity Fund, the Growth and Income
Fund, the International Equity Fund, the International Equity Index Fund, the
Life Vision Aggressive Growth Fund (formerly Life Vision Maximum Growth
Portfolio), the Life Vision Growth and Income Fund (formerly Life Vision Growth
and Income Portfolio), the Life Vision Moderate Growth Fund (formerly Life
Vision Balanced Portfolio), the Mid-Cap Equity Fund, the Small Cap Growth Stock
Fund, the Small Cap Value Equity Fund (formerly Small Cap Equity Fund), the Tax
Sensitive Growth Stock Fund, the Value Income Stock Fund, (collectively the
"Equity Funds"), the Florida Tax-Exempt Bond Fund, the Georgia Tax-Exempt Bond
Fund, the High Income Fund, the Investment Grade Bond Fund, the Investment Grade
Tax-Exempt Bond Fund, the Limited-Term Federal Mortgage Securities Fund, the
Maryland Municipal Bond Fund, the Short-Term Bond Fund, the Short-Term U.S.
Treasury Securities Fund, and the U.S. Government Securities Fund, the Virginia
Intermediate Municipal Bond Fund, the Virginia Municipal Bond Fund,
(collectively the "Fixed Income Funds"), the Prime Quality Money Market Fund,
the Tax-Exempt Money Market Fund, the Tax-Free Money Market Fund, the U.S.
Government Securities Money Market Fund, the U.S. Treasury Money Market Fund
(collectively the "Retail Money Market Funds"), the Classic Institutional Cash
Management Money Market Fund, the Classic Institutional U.S. Government
Securities Money Market Fund and the Classic Institutional U.S. Treasury
Securities Money Market Fund, (collectively the "Institutional Money Market
Funds" or the "Funds"). The assets of each Fund are segregated, and a
shareholder's interest is limited to the fund in which shares are held. Each
Fund's prospectus provides a description of the Fund's investment objectives,
policies and strategies. The financial statements presented herein are those of
the Institutional Money Market Funds. The financial statements of the Equity
Funds, the Fixed Income Funds and the Retail Money Market Funds are not
presented herein, but are presented separately.
Effective May 1999, the Board of Trustees of the STI Classic Funds and Board of
Trustees of the Arbor Funds approved an Agreement and Plan of Reorganization
(the "Reorganization Agreement") providing for the transfer of all assets and
certain stated liabilities of the Arbor Funds in exchange for the issuance of
shares in the Funds in a tax-free reorganization (see Note 8).
2. Significant Accounting Policies:
The following is a summary of significant accounting policies followed by the
Trust:
BASIS OF PRESENTATION OF STATEMENTS -- As more fully described in Note 8
the STI Classic Funds acquired certain Arbor Funds in a tax-free business
combination. While each Fund now exists as a STI Classic Fund, both the
surviving funds for accounting purposes are Arbor Funds. In accordance with
generally accepted accounting principles, the financial statements
presented herein represent those of accounting survivors. Accordingly, the
Statements of Changes in Net Assets and Financial Highlights presented for
the periods prior to and ending on May 31, 1999 reflect activity beginning
on the first day of the accounting survivor's fiscal year.
16
<PAGE>
-------------------------------------------------------------------------------
SECURITY VALUATION -- Investment securities held by the Funds are stated at
amortized cost, which approximates market value.
FEDERAL INCOME TAXES -- It is each Fund's
intention to qualify as a regulated investment company for Federal income
tax purposes and distribute all of its taxable income and net capital
gains. Accordingly, no provisions for Federal income taxes are required.
SECURITY TRANSACTIONS AND INVESTMENT INCOME -- Security transactions are
accounted for on the date the security is purchased or sold (trade date).
Interest income is recognized on an accrual basis. Costs used in
determining net realized gains and losses on the sales of investment
securities are those of the specific securities sold adjusted for the
accretion and amortization of purchase discounts and premiums during the
respective holding period. Purchase discounts and premiums on securities
held by the Funds are accreted and amortized ratably to maturity and are
included in interest income.
REPURCHASE AGREEMENTS -- Securities pledged as collateral for repurchase
agreements are held by the custodian bank until the respective agreements
mature. Provisions of the repurchase agreements ensure that the market
value of the collateral, including accrued interest thereon, is sufficient
in the event of default of the counterparty. If the counterparty defaults
and the value of the collateral declines or if the counterparty enters into
an insolvency proceeding, realization of the collateral by the Funds may be
delayed or limited.
NET ASSET VALUE PER SHARE -- The net asset value per share of each Fund is
calculated each business day, by dividing the total value of each Fund's
assets, less liabilities, by the number of shares outstanding.
OTHER -- Expenses that are directly related to a specific Fund are charged to
that Fund. Class specific expenses are borne by that class. Other operating
expenses of the Trust are pro-rated to the Funds on the basis of relative
net assets. Fund expenses are pro-rated to the respective classes on the
basis of relative net assets.
DISTRIBUTIONS TO SHAREHOLDERS -- Distributions from net investment income
of each of the Funds are declared on each business day and paid to
shareholders on a monthly basis. Any net realized capital gains on sales of
securities are distributed to shareholders at least annually.
RECLASSIFICATION OF COMPONENTS OF NET ASSETS -- The timing and
characterization of certain income and capital gains distributions are
determined annually in accordance with federal tax regulations which may
differ from generally accepted accounting principles. As a result, net
investment income (loss) and net realized gain (loss) on investment
transactions for a reporting period may differ significantly from
distributions during such period. These book/tax differences may be
temporary or permanent in nature. To the extent these differences are
permanent, they are charged or credited to paid-in-capital or accumulated
net realized gain, as appropriate, in the period that the differences
arise. Accordingly, the Institutional Cash Management Money Market Fund and
the Institutional U.S. Treasury Securities Money Market Fund have
reclassified $9,970 and $26,668, respectively, from Undistributed Net
Investment Income to Accumulated Net Realized Gain. These reclassifications
are attributable to the classification of short-term capital gains and
ordinary income treatment for tax purposes. These reclassifications have no
effect on net assets or net asset value per share.
17
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued)
------------------------------------------------------------------------------
STI CLASSIC FUNDS MAY 31, 2000
USE OF ESTIMATES -- The preparation of the financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that effect the reported
amount of assets and liabilities, disclosure of contingent assets and
liabilities at the date of the financial statements, and reported amounts
of revenues and expenses during the reporting period. Actual amounts could
differ from these estimates.
3. Transactions with Affiliates:
Certain officers of the Trust are also officers of SEI Investments Mutual
Funds Services ("the Administrator") and/or SEI Investments Distribution Co.
(the "Distributor").Such officers are paid no fees by the Trust for
serving as officers of the Trust.
The Trust and the Distributor are parties to a Distribution Agreement dated
November 21, 1995. The Distributor does not receive any fees for its
distribution services provided under this agreement.
The Fund has entered into an agreement with the Distributor to manage the
investments of repurchase agreements for the Funds. For its services the
Distributor received $1,846,277 for the year ended May 31, 2000.
4. Administration, Shareholder, and Transfer Agency Servicing Agreements:
The Trust and the Administrator are parties to an Administration Agreement
dated May 29, 1995, as amended November 19, 1997 and March 1, 1999, under which
the Administrator provides administrative services for an annual fee (expressed
as a percentage of the combined average daily net assets of the Trust and STI
Classic Variable Trust) of: .12% up to $1 billion, .09% on the next $4 billion,
.07% on the next $3 billion, .065% on the next $2 billion and .06% for over $10
billion.
Prior to May 1999, administrative and accounting services were provided to
the Arbor U.S. Government Securities Money Fund and Arbor Prime Obligations Fund
by SEI Investments Mutual Funds Services who was entitled to receive a fee at an
annual rate of .08% of the average daily net assets of these funds. A portion of
these fees were voluntarily waived.
The Institutional U.S. Treasury Money Market Fund has adopted a Shareholder
Services Plan (the "Plan") for the Corporate Trust Shares. The Fund pays the
Distributor a monthly shareholder services fee at an annual rate of 0.20% of the
average daily net assets of the Fund's Corporate Trust Shares, which may be used
by the Distributor to provide compensation to service providers that have agreed
to provide shareholder support services for their customers who own Corporate
Trust Shares of the Fund.
The Trust and Federated Services Company are parties to a Transfer Agency
servicing agreement dated May 14, 1994 under which Federated Services Company
provides transfer agency services to the Trust.
5. Investment Advisory and Custodian Agreements:
The Trust and Trusco Capital Management, Inc. (the "Investment Adviser") have
entered into an advisory agreement dated July 15, 1993.
Under terms of the respective agreements, the Funds are charged the following
annual fees based upon average daily net assets:
18
<PAGE>
-------------------------------------------------------------------------------
MAXIMUM INSTITUTIONAL CORPORATE
ANNUAL SHARE TRUST SHARE
ADVISORY MAXIMUM MAXIMUM
FEE EXPENSE EXPENSE
--------- ------------ ------------
Classic Institutional
Cash Management
Money Market Fund .20% .25% --
Classic Institutional
U.S. Government
Securities Money
Market Fund .20% .25% --
Classic Institutional
U.S. Treasury
Money Market Fund .20% .25% .45%
The Investment Adviser and the Administrator have voluntarily agreed to waive
all or a portion of their fees (and to reimburse Funds' expenses) in order to
limit operating expenses to an amount as outlined in the table above. Fee
waivers and expense reimbursements are voluntary and may be terminated at any
time.
Prior to May 1999, Crestar Asset Management Company ("CAMCO") provided
Investment Advisory services to certain Arbor Funds. CAMCO was paid for advisory
services to each Fund at an annual rate of .10% and .11% of the average daily
net assets for Arbor U.S. Government Securities Money and Arbor Prime
Obligations Funds, respectively.
SunTrust Bank, Atlanta, acts as custodian for the Funds. Fees of the Custodian
are paid on the basis of the net assets of the Funds. The Custodian plays no
role in determining the investment policies of the Trust or which securities are
to be purchased or sold in the Funds.
6. Concentration of Credit Risk:
The Classic Institutional Cash Management Money Market Fund invests in high
quality money market instruments issued by corporations and the U.S. Government
and rated by one or more nationally recognized statistical rating organizations,
or, if not rated, are determined by the Adviser to be of comparable quality. The
Classic Institutional U.S. Government Securities Money Market Fund invests in
U.S. Treasury obligations, U.S. Government subsidiary corporation securities
which are backed by the full faith and credit of the U.S. government and
repurchase agreements with approved dealers collateralized by U.S. Treasury
securities and U.S. Government subsidiary corporation securities. The Classic
Institutional U.S. Treasury Securities Money Market Fund invests in U.S.
Treasury Obligations, which are backed by the full faith and credit of the U.S.
Government and repurchase agreements with approved dealers collateralized by
U.S. Treasury securities.
7. Investment Transactions:
Subsequent to October 31, 1999, the Funds recognized net capital losses for tax
purposes that have been deferred to 2000 and can be used to offset future
capital gains at May 31, 2000. The Funds also had capital loss carryforwards at
May 31, 2000 as follows:
CAPITAL LOSS POST 10/31
CARRYOVER EXPIRES EXPIRES DEFERRED
5/31/00 2003 2004 LOSS
FUND (000) 000) (000) (000)
------ ---------- ------- ------- ----------
Classic Institutional
U.S. Government
Securities Money
Market Fund $25 $11 $14 $--
Classic Institutional
U.S. Treasury Securities
Money Market Fund -- -- -- 3
For tax purposes, the losses in the Funds can be carried forward for a maximum
of eight years to offset any net realized capital gains.
19
<PAGE>
NOTES TO FINANCIAL STATEMENTS (concluded)
------------------------------------------------------------------------------
STI CLASSIC FUNDS MAY 31, 2000
8. Arbor Funds Merger:
The Board of Trustees and shareholders of certain of the Arbor Funds approved a
reorganization of certain of the Arbor Funds into the STI Classic Funds which
took place during May 1999.
The following table summarizes certain relevant information of the funds prior
to and immediately after the business combinations in May 1999 and is unaudited:
<TABLE>
SHARES
OUTSTANDING SHARES ISSUED NET ASSETS NAV
ON MERGER IN BUSINESS AFTER PER
ARBOR FUND DATE STI CLASSIC FUND COMBINATION COMBINATION SHARE
-------------------------- -------------- ----------------------------------- -------------- ------------ ---------
U.S. Government Securities 684,672,707 Classic Institutional U.S. Government 684,672,707 684,647,218 $1.00
Money Fund (1) Securities Money Market Fund
Prime Obligations Fund (1) 711,747,295 Classic Institutional Cash Management 711,747,295 1,783,974,148 1.00
Money Market Fund
(1) Represents the accounting survivor in this business combination.
9. Subsequent Event:
Effective June 30, 2000, SunTrustBanks, Inc. reorganized all of the investment
management functions of its three institutional money management units,
including SunTrust Bank, into Trusco Capital Management, Inc.
20
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
-------------------------------------------------------------------------------
STI CLASSIC FUNDS MAY 31, 2000
To the Shareholders and Board of Trustees of
STI Classic Funds:
We have audited the accompanying statements of net assets of the Classic
Institutional Cash Management Money Market, Classic Institutional U.S.
Government Securities Money Market, and Classic Institutional U.S. Treasury
Securities Money Market Funds of STI Classic Funds (the "Trust") as of May 31,
2000, and the related statements of operations, changes in net assets, and
financial highlights for the periods presented, excluding the periods indicated
below. These financial statements and financial highlights are the
responsibility of the Trust's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits. The statements of changes for the year ended January 31, 1999 and
financial highlights for the periods presented prior to May 31, 1999, for the
Classic Institutional Cash Management Money Market and Classic Institutional
U.S. Government Securities Money Market Funds, were audited by other auditors
whose report, dated March 15, 1999, expressed an unqualified opinion on this
information.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whe-ther the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements and financial highlights. Our procedures included
confirmation of securities owned as of May 31, 2000, by correspondence with the
custodian and the application of alternative auditing procedures with respect to
unsettled securities transactions. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights audited by us
present fairly, in all material respects, the financial position of the Classic
Institutional Cash Management Money Market, Classic Institutional U.S.
Government Securities Money Market, and Classic Institutional U.S. Treasury
Securities Money Market Funds, of STI Classic Funds as of May 31, 2000, the
results of their operations, changes in their net assets, and financial
highlights for each of the periods described in the first paragraph above, in
conformity with accounting principles generally accepted in the United States.
ARTHUR ANDERSEN LLP
Philadelphia, Pennsylvania
July 18, 2000
21
<PAGE>
NOTICE TO SHAREHOLDERS
------------------------------------------------------------------------------
STI CLASSIC FUNDS MAY 31, 2000UNAUDITED
For shareholders that do not have a May 31, 2000 tax year end, this notice is
for informational purposes only. For shareholders with a May 31, 2000, please
consult your tax adviser as to the pertinence of this notice. For the fiscal
year ended May 31, 2000, each portfolio is designating the following items with
regard to distributions paid during the year.
LONG TERM
(20% RATE) ORDINARY
CAPITAL GAIN INCOME TAX-EXEMPT TOTAL QUALIFYING
FUND DISTRIBUTIONS DISTRIBUTIONS INTEREST DISTRIBUTIONS DIVIDENDS (1)
-------------------------------------- --------------- -------------- ---------- -------------- --------------
Classic Institutional Cash Management
<S> <C> <C> <C> <C> <C>
Money Market Fund --% 100.00% --% 100.00% --%
Classic Institutional U.S. Treasury
Securities Money Market Fund --% 100.00% --% 100.00% --%
Classic Institutional U.S. Government
Money Market Fund --% 100.00% --% 100.00% --%
(1) Qualifying dividends represent dividends which qualify for the corporate
dividends received deduction and is reflected as a percentage of "OrdinaryIncome
Distributions".
</TABLE>
22
<PAGE>
NOTES
<PAGE>
NOTES
<PAGE>
NOTES
<PAGE>
INVESTMENT ADVISER
Trusco Capital Management, Inc.
STI Classic Funds are not deposits, are not insured or guaranteed by the FDIC or
any other government agency, and are not endorsed by and do not constitute
obligations of SunTrust Banks, Inc. or any other of its affiliates. Investment
in the Funds involves risk, including the possible loss of principal. There is
no guarantee that any STI Classic Fund will achieve its investment objective.
The STI Classic Funds are advised by affiliates of SunTrust Banks, Inc.
DISTRIBUTOR
SEI Investments Distribution Co.
This information must be preceded or
accompanied by a current prospectus for
each Fund described.
<PAGE>
