[PHOTO] New York Skyline
THE INSTITUTIONAL FUND
1998 Semi-Annual Report
June 30, 1998
Investment Adviser - R. Meeder & Associates
<PAGE>
THE INSTITUTIONAL FUND
[PHOTO] Philip A. Voelker, Portfolio Manager
7-DAY SIMPLE YIELD PORTFOLIO HOLDINGS
as of 6/30/98 5.40%
[GRAPH] The following was presented
7-DAY COMPOUND YIELD as a pie chart:
as of 6/30/98 5.54%
Commercial Paper 37%
Corporate Obligations 24%
PERIOD AND AVERAGE Repurchase Agreements 18%
ANNUAL TOTAL RETURNS Floating Rate Notes 18%
as of 6/30/98 U.S. Govt. Obligations 3%
Year to date 2.72%
1 year 5.58%
2 years 5.51%
3 years 5.55%
4 years 5.55%
Life of fund 5.54%
During the first half of 1998, The Institutional Fund continued to provide a
total return that exceeded the total return of the average institutional money
market fund.
For the twelve months ended June 30, 1998, The Institutional Fund provided a
total annual return of 5.58%, compared with the 5.45% total annual return of the
average institutional fund, according to IBC Financial Data, an independent
money market fund monitor.
As of the close of business June 30, 1998, The Institutional Fund's 6-month
total return was 2.72%. The Fund's 7-day simple yield as of that date was 5.40%,
while its 7-day compound yield was 5.54%.
MARKET PERSPECTIVE
We continued our neutral stance in regard to interest rates during the first
half of 1998. As a result, we continued to reduce the average maturity of
securities within the portfolio of The Institutional Fund during the second
quarter, from about 60 days at the beginning of April to 45 days in mid-June.
The trend in short-term interest rates through the last six months has been
relatively flat. The Federal Reserve Board continues to walk a tightrope between
raising rates to stave off inflation, and lowering rates to counter the
decelerating pressures of the Asian financial crisis.
When long-term interest rates are stable or falling - as they did slide slightly
toward the end of the second quarter - it gives us confidence that the Fed is
not going to raise short-term rates. At the same time, we are not aggressively
pursuing longer maturity investments, because there is very little difference
between six-month commercial paper and the Fed's overnight rate, which was 5.5%.
This is a conservative position, in case the Fed does move to increase rates or
external shocks lead to increased interest rates in the bond market. A shorter
maturity structure also allows us to move decisively if economic conditions do
change.
Currently, we do not expect to make a significant change to the portfolio for
some time. There is little economic reason to do so, with long-term bonds
trading at a lower rate than overnight Federal Reserve funds. There is only a
narrow advantage in owning riskier, long-term securities rather than safer,
short-term securities.
The total return data included in this report assumes reinvestment of all
dividends and capital gains distributions. All performance data represents past
performance and does not necessarily indicate future performance results. The
Investment Adviser waived a portion of its management fee to reduce the
operating expenses of the Institutional Fund for the periods shown. The
Institutional Fund will seek to maintain a constant net asset value of $1.00 per
share, although there is no guarantee it will be able to do so. Investments in
the Institutional Fund are neither insured nor guaranteed by the U.S.
Government. For more complete information, please call or write for a free
Institutional Fund prospectus. Read the prospectus carefully before investing.
2 The Institutional Fund 1998 Semi-Annual Report
<PAGE>
<TABLE>
MONEY MARKET PORTFOLIO
Portfolio of Investments as of June 30, 1998 (Unaudited)
<CAPTION>
COUPON/ AMORTIZED
YIELD MATURITY FACE AMOUNT COST
----- -------- ----------- ----
<S> <C> <C> <C> <C>
COMMERCIAL PAPER - 36.9%
American Honda Finance Corp. 5.51% 07/30/98 20,000,000 19,911,228
American Trading & Production Corp.*** 5.53% 07/07/98 2,000,000 1,998,157
Caterpillar Financial Services Corp. 5.47% 12/08/98 6,714,000 6,550,775
Credit Suisse First Boston 5.50% 08/10/98 25,000,000 24,847,222
Duff & Phelps Utility and Corporate Bond Trust, Inc.*** 5.65% 07/02/98 5,000,000 4,999,215
Duff & Phelps Utility and Corporate Bond Trust, Inc.*** 5.44% 09/10/98 5,000,000 4,946,356
Duff & Phelps Utility and Corporate Bond Trust, Inc.*** 5.43% 10/15/98 3,075,000 3,025,836
Eaton Corp. 5.49% 11/17/98 17,700,000 17,324,804
General Electric Capital Corp. 5.37% 08/26/98 20,000,000 19,832,933
General Electric Capital Corp. 5.40% 10/15/98 5,000,000 4,920,500
General Electric Capital Corp. 5.48% 12/04/98 12,000,000 11,715,040
Greenwich Asset Funding, Inc.*** 5.42% 10/09/98 5,300,000 5,220,205
Greenwich Asset Funding, Inc.*** 5.44% 10/09/98 20,000,000 19,697,778
J.P. Morgan & Co., Inc. 5.35% 07/15/98 35,000,000 34,927,181
LG&E Capital Corp.*** 5.43% 09/11/98 19,160,000 18,951,923
Merrill Lynch & Co., Inc. 5.30% 10/07/98 10,000,000 9,855,722
Merrill Lynch & Co., Inc. 5.52% 10/20/98 10,000,000 9,829,800
Monsanto Co. 5.50% 08/20/98 20,000,000 19,851,198
TECO Finance, Inc.*** 5.50% 08/07/98 6,215,000 6,179,868
TECO Finance, Inc.*** 5.50% 08/20/98 7,500,000 7,442,708
===============================================================================================================
TOTAL COMMERCIAL PAPER
(Cost$252,028,449 ) 252,028,449
- ---------------------------------------------------------------------------------------------------------------
CORPORATE OBLIGATIONS - 42.3%
ABT 95 Series A-3 5.65%* 07/15/98 20,000,000 20,000,000
American General Finance Corp. 8.50% 08/15/98 2,200,000 2,207,327
Associates Corp., N.A. 8.80% 08/01/98 1,000,000 1,002,572
Associates Corp., N.A. 5.25% 09/01/98 180,000 179,747
Associates Corp., N.A. 6.50% 09/09/98 5,225,000 5,234,282
Aquarium Holdings KY 5.67%* 07/02/98 12,000,000 12,000,000
Bankers Trust 5.53%* 07/07/98 3,000,000 2,999,955
Barnett Banks, Inc. 6.25% 07/28/98 1,500,000 1,500,412
Bear Stearns Corp. 5.73%* 07/07/98 20,000,000 20,000,000
Bear Stearns Corp. 5.70% 11/12/98 10,000,000 9,794,919
Bell Atlantic 5.30% 09/01/98 500,000 499,558
CIT Group Holdings, Inc. 5.88% 12/28/98 25,000,000 25,016,995
CPC International, Inc. 6.15% 09/18/98 8,197,000 8,207,625
Care Life Project 5.69%* 07/02/98 1,275,000 1,275,000
Carolina Power & Light 5.01% 09/15/98 1,000,000 998,553
Caterpillar Financial Services Corp. 6.07% 02/09/99 2,135,000 2,138,174
Chrysler Financial Corp. 7.85% 10/13/98 2,350,000 2,365,151
Clark Grave Vault Co. 5.67%* 07/02/98 2,850,000 2,850,000
Coughlin Family Properties, Inc. 5.67%* 07/02/98 4,470,000 4,470,000
D.E.D.E. Realty 5.67%* 07/02/98 3,850,000 3,850,000
Danis Construction Co. 5.67%* 07/02/98 1,000,000 1,000,000
Deere Capital 7.14% 09/15/98 9,800,000 9,831,591
Doren, Inc. 5.69%* 07/02/98 600,000 600,000
Espanola/Nambe 5.69%* 07/02/98 2,315,000 2,315,000
Ford Motor Credit Co. 5.63% 12/15/98 400,000 399,936
Franklin Universal Trust 5.63% 09/01/98 17,000,000 16,994,698
General Motors Acceptance Corp. 6.05% 10/09/98 1,850,000 1,851,371
General Motors Acceptance Corp. 6.00% 12/07/98 100,000 100,036
General Motors Acceptance Corp. 7.75% 01/15/99 100,000 100,968
Hartford Financial 8.20% 10/15/98 2,500,000 2,516,825
Hancor, Inc. 5.69%* 07/02/98 700,000 700,000
Huntington National Bank 6.15% 10/15/98 4,200,000 4,203,987
IBM Credit Corp. 5.90% 08/10/98 2,050,000 2,050,008
International Lease Finance Corp. 5.75% 07/01/98 100,000 100,000
Isaac Tire, Inc. 6.20%* 07/02/98 1,000,000 1,000,000
J.C. Penney Co., Inc. 5.38% 11/15/98 11,330,000 11,317,145
John Hancock Capital 6.43% 09/03/98 10,000,000 10,014,032
MCA Funding Corp. 5.15% 10/05/98 7,000,000 6,987,566
Mubea, Inc. 5.69%* 07/02/98 10,375,000 10,375,000
NationsBank Corp. 5.13% 09/15/98 1,840,000 1,837,964
NationsBank Corp. 8.50% 03/01/99 1,095,000 1,114,130
New England Education Loan Marketing Corp. 6.13% 07/17/98 23,200,000 23,205,561
New York Telephone Co. 5.25% 09/01/98 2,000,000 1,998,353
Norwest Corp. 5.75% 11/16/98 700,000 700,087
O.K.I. Supply Co. 5.67%* 07/02/98 2,150,000 2,150,000
Osco Industries, Inc. 5.69%* 07/02/98 3,000,000 3,000,000
Pacific Gas & Electric Co. 5.38% 08/01/98 305,000 304,895
Pepsico, Inc. 7.63% 12/18/98 2,000,000 2,019,102
Presrite Corp. 5.69%* 07/02/98 2,040,000 2,040,000
Pro Tire, Inc. 6.20%* 07/02/98 1,200,000 1,200,000
The Institutional Fund 1998 Semi-Annual Report 3
<PAGE>
COUPON/ AMORTIZED
YIELD MATURITY FACE AMOUNT COST
----- -------- ----------- ----
R.I. Lampus Co. 5.69%* 07/02/98 2,440,000 2,440,000
RSD Technology 5.69%* 07/02/98 4,400,000 4,400,000
Salomon, Inc. 6.04% 07/09/98 5,950,000 5,950,538
Salomon, Inc. 5.80% 07/12/98 1,000,000 999,856
Salomon, Inc. 5.90% 07/15/98 250,000 250,313
Salomon, Inc. 5.90% 08/24/98 1,000,000 1,000,194
Salomon, Inc. 5.97% 12/01/98 1,025,000 1,026,264
Seariver Maritime, Inc. 5.64%* 07/01/98 6,700,000 6,700,000
Surgery Financing Co. 5.69%* 07/02/98 6,585,000 6,585,000
Salomon Smith Barney Holding, Inc. 5.63% 11/15/98 260,000 259,968
Virginia Electric Power 9.35% 10/19/98 400,000 404,418
Wachovia Corp. 5.25% 07/13/98 1,000,000 999,897
White Castle Project 5.69%* 07/02/98 9,250,000 9,250,000
Wisconsin Public Service Corp. 5.25% 07/01/98 320,000 320,000
===============================================================================================================
TOTAL CORPORATE OBLIGATIONS
(Cost$289,204,973 ) 289,204,973
- ---------------------------------------------------------------------------------------------------------------
U.S. GOVERNMENT AGENCY OBLIGATIONS - 2.3%
Federal National Mortgage Assoc. 5.10% 07/22/98 1,000,000 999,626
Federal National Mortgage Assoc. 7.85% 09/10/98 100,000 100,375
Federal National Mortgage Assoc. 7.05% 12/10/98 100,000 100,527
FICO Strip 5.56%* 09/07/98 5,000,000 4,948,239
Student Loan Marketing Assoc. 5.30%* 07/07/98 5,000,000 5,000,000
Student Loan Marketing Assoc. 5.38%* 07/07/98 4,350,000 4,351,593
===============================================================================================================
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS
(Cost $15,500,360 ) 15,500,360
- ---------------------------------------------------------------------------------------------------------------
U.S. TREASURY OBLIGATIONS - 0.7%
** U.S. Treasury Bill 5.02% 01/07/99 63,100 61,428
U.S. Treasury Note 6.00% 09/30/98 5,000,000 5,003,281
================================================================================================================
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $5,064,709 ) 5,064,709
- ----------------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS - 17.8%
Merrill Lynch, (Collateralized by $118,722,000
various Commercial Paper, 07/07/98-09/25/98,
market value - $118,722,000) 6.30%* 07/01/98 115,932,000 115,932,000
State Street Bank, (Collateralized by $5,760,000
U.S. Treasury Note, 6.63%, 07/31/01
market value - $6,082,819) 5.25%* 07/01/98 5,960,000 5,960,000
================================================================================================================
TOTAL REPURCHASE AGREEMENTS
(Cost $121,892,000 ) 121,892,000
- ----------------------------------------------------------------------------------------------------------------
================================================================================================================
TOTAL INVESTMENTS - 100.0%
(Cost$683,690,491 )(a) $683,690,491
- ----------------------------------------------------------------------------------------------------------------
<FN>
(a) Cost for federal income tax and financial reporting purposes are the same.
* Variable rate security. Interest rate is as of June 30, 1998. Maturity date
reflects the next rate change date.
** Pledged as collateral on Letter of Credit.
*** Security is restricted as to resale to institutional investors, but has
been deemed liquid in accordance with guidelines approved by the Board of
Trustees.
</FN>
</TABLE>
See accompanying notes to financial statements.
4 The Institutional Fund 1998 Semi-Annual Report
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1998 (Unaudited)
THE INSTITUTIONAL FUND
Assets:
Investment in corresponding portfolio at value $538,693,815
Unamortized organization costs 3,155
Other assets 486,357
Total Assets 539,183,327
================================================================================
Liabilites:
Dividends payable 2,459,831
Accrued transfer agent and administrative fees 46,295
Other accrued liabilities 10,228
Total Liabilities 2,516,354
================================================================================
Net Assets 536,666,973
================================================================================
Net Assets:
Capital 536,666,973
Net Assets $536,666,973
================================================================================
Capital Stock Outstanding (indefinite shares authorized, 536,666,973
$0.100 par value)
================================================================================
Net Asset Value, Offering and Redemption Price Per Share $1.00
================================================================================
See accompanying notes to financial statements.
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1998 (Unaudited)
Net Investment Income from Corresponding Portfolio: THE INSTITUTIONAL FUND
================================================================================
Interest $14,915,697
Expenses (469,450)
Total Net Investment Income from Corresponding Portfolio 14,446,247
================================================================================
Fund Expenses:
================================================================================
Administrative fee 131,058
Transfer agent fees 157,273
Audit fees 2,209
Legal fees 1,725
Printing 541
Amortization of organizational costs 1,584
Distribution plan 48,981
Postage 1,382
Registration and filing fees 20,507
Insurance 314
Other expenses 6,191
Total Expenses 371,765
================================================================================
Expenses reimbursed by investment adviser (193,435)
Net Expenses 178,330
NET INVESTMENT INCOME 14,267,917
================================================================================
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $14,267,917
================================================================================
See accompanying notes to financial statements
The Institutional Fund 1998 Semi-Annual Report 5
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
FOR THE SIX MONTHS ENDED JUNE 30, 1998 (Unaudited)
AND YEAR ENDED DECEMBER 31, 1997
Six Months Ended Year Ended
June 30, 1998 Dec. 31, 1997
INCREASE (DECREASE) IN NET ASSETS:
================================================================================
OPERATIONS:
Net investment income $14,267,917 $20,394,527
Net increase in net assets
resulting from operations 14,267,917 20,394,527
================================================================================
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (14,267,917) (20,394,527)
Net decrease in net assets resulting
from dividends and distributions (14,267,917) (20,394,527)
================================================================================
CAPITAL TRANSACTIONS:
Issued 1,585,617,295 3,337,084,529
Reinvested 746,541 3,043,438
Redeemed (1,465,691,203) (3,156,276,005)
Net increase in net assets resulting from
capital share transactions 120,672,633 183,851,962
TOTAL INCREASE IN NET ASSETS 120,672,633 183,851,962
================================================================================
NET ASSETS - Beginning of period 415,994,340 232,142,378
NET ASSETS - End of period $536,666,973 $415,994,340
================================================================================
SHARE TRANSACTIONS:
Issued 1,585,617,295 3,337,084,529
Reinvested 746,541 3,043,438
Redeemed (1,465,691,203) (3,156,276,005)
Change in shares 120,672,633 183,851,962
See accompanying notes to financial statements
<TABLE>
FINANCIAL HIGHLIGHTS
<CAPTION>
Six Months Ended June 15, 1994*
June 30, 1998 Year Ended December 31, to
(unaudited) 1997 1996 1995 Dec. 31, 1994
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $1.000 $1.000 $1.000 $1.000 $1.000
Income from Investment Operations
Net Investment Income 0.027 0.054 0.053 0.059 0.026
Total From Investment Operations 0.027 0.054 0.053 0.059 0.026
Less Distributions
Dividends (from net investment income) (0.027) (0.054) (0.053) (0.059) (0.026)
Total Distributions (0.027) (0.054) (0.053) (0.059) (0.026)
Net Asset Value, End of Period $1.000 $1.000 $1.000 $1.000 $1.000
Total Return 2.72%(1) 5.53% 5.43% 6.01% 4.80%(2)
Ratios/Supplementary Data
===================================================================================================================
Net Assets, End of Period ($000) $536,667 $415,994 $232,142 $113,205 $59,494
Ratio of Expenses to Average Net Assets 0.25%(2) 0.25% 0.25% 0.25% 0.25%(2)
Ratio of Net Investment Income to
Average Net Assets 5.44%(2) 5.41% 5.30% 5.87% 4.51%(2)
Ratio of Expenses to Average Net Assets,
before waiver of fees(3) 0.44%(2) 0.47% 0.46% 0.55% 0.46%(2)
Ratio of Net Investment Income to Average
Net Assets, before waiver of fees(3) 5.25%(2) 5.19% 5.09% 5.57% 4.25%(2)
<FN>
(1) Not Annualized
(2) Annualized
(3) Ratio includes fees waived in corresponding portfolio
* Date of commencement of operations.
</FN>
</TABLE>
See accompanying notes to financial statements
6 The Institutional Fund 1998 Semi-Annual Report
<PAGE>
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1998 (UNAUDITED)
1. ORGANIZATION
The Flex-Partners Trust (the "Trust") was organized in 1992 and is registered
under the Investment Company Act of 1940, as amended (the "Act"), as a
diversified, open-end management investment company. The Trust offers five
series, and it is presently comprised of five separate funds as follows: Core
Equity Fund, Tactical Asset Allocation Fund, Utility Growth Fund, International
Equity Fund and Institutional Fund (collectively the "Funds"). The Institutional
Fund (the "Fund") invests all of its investable assets in a corresponding
open-end management investment company (the "Portfolio") having the same
investment objective as the Fund. The Fund, the Portfolio into which the Fund
invests and the percentage of the Portfolio owned by the Fund is as follows:
PERCENTAGE OF PORTFOLIO
OWNED BY FUND AS OF
FUND PORTFOLIO JUNE 30, 1998
- ---- --------- -------------
Institutional Fund Money Market Portfolio 78%
The financial statements of the Portfolio, including the Portfolio of
Investments, are included elsewhere in this report and should be read in
conjunction with the financial statements of the Fund. The financial statements
of the Core Equity Fund, Tactical Asset Allocation Fund, Utility Growth Fund and
International Equity Fund are separately reported.
2. SIGNIFICANT ACCOUNTING POLICES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
VALUATION OF INVESTMENTS
The Fund values its investment in the corresponding Portfolio at fair value.
Valuation of securities held by the Portfolio is further described at Note 2 of
the Portfolio's Notes to Financial Statements which are included on Page 11 of
this report.
INCOME TAXES
It is the Fund's policy to comply with the requirements of the Internal Revenue
Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income and net capital gains
to its shareholders. Therefore, no Federal income tax provision is required.
DISTRIBUTIONS TO SHAREHOLDERS
Dividends to shareholders are recorded on the ex-dividend date. The Fund
declares dividends from net investment income on a daily basis and pays such
dividends on a monthly basis. The Fund distributes net capital gains, if any, on
an annual basis.
Distributions from net investment income and from net capital gains are
determined in accordance with income tax regulations which may differ from
generally accepted accounting principles. Permanent book and tax basis
differences have been reclassified among the components of net assets.
ORGANIZATIONAL COSTS
The costs related to the organization of the Fund have been deferred and are
being amortized by the Fund on a straight-line basis over a five-year period.
EXPENSES
Expenses incurred by the Trust that do not specifically relate to an individual
Fund of the Trust are allocated to the Funds based on each Fund's relative net
assets or other appropriate basis.
3. AGREEMENTS AND TRANSACTIONS WITH AFFILIATES
R. Meeder & Associates (RMA), a wholly-owned subsidiary of Muirfield Investors,
Inc. (MII), provides the Portfolio with investment management, research,
statistical and advisory services.
Mutual Funds Service Co. ("MFSCo"), a wholly-owned subsidiary of MII, serves as
stock transfer, dividend disbursing and shareholder services agent for the Fund.
In compensation for such services, the Fund pays MFSCo an annual fee equal to
the greater of $20 per active shareholder account or 0.06% of the Fund's average
daily net assets. MFSCo is entitled to receive an annual minimum fee of $4,000
for the Fund.
The Institutional Fund 1998 Semi-Annual Report 7
<PAGE>
MFSCo provides the Trust with certain administrative services. In compensation
for such services, the Fund pays MFSCo an annual fee equal to 0.05% of the
Fund's average daily net assets.
RMA has voluntarily agreed to reimburse the Fund for the amount by which annual
expenses of the Fund including expenses allocated from its respective Portfolio
(excluding interest, taxes, brokerage fees, and extraordinary expenses) exceed
0.25% of average daily net assets of the Fund. Such reimbursement is limited to
the total of fees charged the Fund by RMA and MFSCo.
Pursuant to Rule 12b-1 of the Act, the Fund has adopted a Distribution Plan (the
"Plan"). Under the terms of the Plan, the Fund may incur certain expenses
associated with the distribution of fund shares in amounts not to exceed 0.03%
of the average daily net assets of the Fund on an annual basis.
Certain officers of the Fund and trustees of the Trust and the Portfolio are
also officers or directors of MII, RMA and MFSCo.
8 The Institutional Fund 1998 Semi-Annual Report
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
JUNE 30, 1998 (Unaudited)
MONEY MARKET
PORTFOLIO
Assets:
Investments at value* $561,798,491
Repurchase agreements, at cost* 121,892,000
Cash 91,710
Interest receivable 2,984,132
Prepaid/Other assets 5,467
Total Assets 686,771,800
=============================================================
Liabilites:
Payable to investment adviser 89,831
Accrued audit fees 8,619
Accrued legal fees 504
Accrued custodian fees 4,732
Accrued fund accounting fees 9,083
Other accrued liabilities 1,830
Total Liabilities 114,599
=============================================================
Net Assets $686,657,201
=============================================================
Net Assets:
=============================================================
Capital 686,657,201
Net Assets $686,657,201
=============================================================
*Securities at cost $683,690,491
See accompanying notes to financial statements
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1998 (Unaudited)
MONEY MARKET
PORTFOLIO
NET INVESTMENT INCOME
============================================================
Interest $19,532,846
Total Investment Income 19,532,846
Expenses:
============================================================
Investment advisory fees 934,598
Audit fees 8,795
Custodian fees 22,680
Trustees fees and expenses 5,160
Legal fees 1,709
Accounting fees 52,757
Insurance 3,136
Other expenses 4,385
Total Expenses 1,033,220
============================================================
Investment advisory fees waived (418,469)
Total Net Expenses 614,751
============================================================
NET INVESTMENT INCOME 18,918,095
============================================================
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $18,918,095
See accompanying notes to financial statements
The Institutional Fund 1998 Semi-Annual Report 9
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE SIX MONTHS ENDED JUNE 30, 1998 (Unaudited)
AND YEAR ENDED DECEMBER 31, 1997
Six Months Ended
June 30, 1998 Year Ended
(unaudited) Dec. 31, 1997
INCREASE (DECREASE) IN NET ASSETS:
================================================================================
OPERATIONS:
Net investment income $18,918,095 $28,315,164
Net increase in net assets
resulting from operations 18,918,095 28,315,164
TRANSACTIONS OF INVESTORS' BENEFICIAL INTERESTS:
================================================================================
Contributions 1,795,005,841 3,784,994,914
Withdrawals (1,714,285,382) (3,579,221,656)
Net increase in net assets resulting from
transactions of investors' beneficial
interests 80,720,459 205,773,258
TOTAL INCREASE IN NET ASSETS 99,638,554 234,088,422
================================================================================
NET ASSETS - Beginning of period 587,018,647 352,930,225
NET ASSETS - End of period $686,657,201 $587,018,647
See accompanying notes to financial statements
FINANCIAL HIGHLIGHTS
RATIOS/SUPPLEMENTARY DATA
<TABLE>
MONEY MARKET PORTFOLIO
<CAPTION>
Six Months Ended
June 30, 1998 Year Ended December 31,
(unaudited) 1997 1996 1995 1994 1993
<S> <C> <C> <C> <C> <C> <C>
Net Assets, End of Period ($000) $686,657 $587,019 $352,930 $256,126 $224,523 $200,148
Ratio of Expenses to Average Net Assets 0.18%(1) 0.18% 0.19% 0.21% 0.19% 0.19%
Ratio of Net Investment Income to
Average Net Assets 5.49%(1) 5.47% 5.34% 5.87% 4.28% 3.09%
Ratio of Expenses to Average Net Assets,
before waiver of fees 0.30%(1) 0.31% 0.33% 0.37% 0.39% 0.40%
Ratio of Net Investment Income to Average
Net Assets, before waiver of fees 5.37%(1) 5.34% 5.20% 5.70% 4.08% 2.88%
</TABLE>
(1) Annualized
See accompanying notes to financial statements
10 The Institutional Fund 1998 Semi-Annual Report
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NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1998 (UNAUDITED)
1. ORGANIZATION
The Institutional Fund (the "Fund") invests all of its investable assets in a
corresponding open-end management investment company (a "Portfolio") having the
same investment objective as the Fund. The Portfolio is registered under the
Investment Company Act of 1940, as amended (the "Act"), as a no-load, open-end
management investment company which was organized as a trust under the laws of
the State of New York. The Declaration of Trust permits the Trustees to issue
beneficial interests in the Portfolio. The Fund, the Portfolio into which the
Fund invests and the percentage of the Portfolio owned by the Fund is as
follows:
PERCENTAGE OF PORTFOLIO
OWNED BY FUND AS OF
FUND PORTFOLIO JUNE 30, 1998
- ---- --------- -------------
Institutional Fund Money Market Portfolio 78%
The investment objective of the Money Market Portfolio is to seek current income
and stable net asset values through investment in a portfolio of money market
instruments. The financial statements of the Funds are included elsewhere in
this report.
2. SIGNIFICANT ACCOUNTING POLICES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
INVESTMENTS
Money market securities held in the Portfolio are valued at amortized cost,
which approximates market value.
REPURCHASE AGREEMENTS
The Portfolio may engage in repurchase agreement transactions whereby the
Portfolio takes possession of an underlying debt instrument subject to an
obligation of the seller to repurchase the instrument from the Portfolio and an
obligation of the Portfolio to resell the instrument at an agreed upon price and
term. At all times, the Portfolio maintains the value of collateral, including
accrued interest, at least 100% of the amount of the repurchase agreement, plus
accrued interest. If the seller defaults or the fair value of the collateral
declines, realization of the collateral by the Portfolios may be delayed or
limited.
INCOME TAXES
It is the Portfolio's policy to comply with the requirements of the Internal
Revenue Code applicable to it. Therefore, no Federal income tax provision is
required.
SECURITIES TRANSACTIONS
The Portfolio records security transactions on the trade date. Interest income
(including amortization of premium and accretion of discount) is recognized as
earned.
3. AGREEMENTS AND TRANSACTIONS WITH AFFILIATES
R. Meeder & Associates (RMA), a wholly-owned subsidiary of Muirfield Investors,
Inc. (MII), provides the Portfolio with investment management, research,
statistical and advisory services. For such services the Portfolio pays monthly
a fee at the following annual rates: 0.40% of average daily net assets up to
$100 million and 0.25% of average daily net assets exceeding $100 million.
During the six months ended June 30, 1998, RMA voluntarily waived a portion of
its investment advisory fees in the Portfolio.
Mutual Funds Service Co. ("MFSCo"), a wholly-owned subsidiary of MII, serves as
accounting services agent for the Portfolio. In compensation for such services
the Portfolio pays MFSCo an annual fee equal to the greater of: a. 0.15% of the
first $10 million of average daily net assets, 0.10% of the next $20 million of
average daily net assets, 0.02% of the next $50 million of average daily net
assets, and 0.01% in excess of $80 million of average daily net assets, or b.
$30,000.
Certain officers and trustees of the Portfolio are also officers or directors of
MII, RMA and MFSCo.
4. SECURITIES TRANSACTIONS
As of June 30, 1998, the aggregate cost basis of investments for Federal income
tax was $683,690,491.
The Institutional Fund 1998 Semi-Annual Report 11
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THE INSTITUTIONAL FUND
R. Meeder & Associates P.O. Box 7177 Dublin OH 43017
