THE FLEX-PARTNERS
INTERNATIONAL EQUITY FUND
1999 ANNUAL REPORT
December 31, 1999
THE FLEX-PARTNERS
Distributed by Adviser Dealer Services, Inc.
P.O. Box 7177 Dublin OH 43017 (800)494-FLEX
<PAGE>
The Flex-Partners Funds 1999 Annual Report
INTERNATIONAL EQUITY FUND
[PHOTO] Charles Brand, Portfolio Manager
The International Equity Fund finished 1999 with a strong 4th Quarter return
of 20.57% before sales charges. For the year, the Fund returned 30.07% before
sales charges. This performance compares favorably against the MSCI EAFE Index*
which returned 16.99% for the quarter and 26.96% for the year.
International markets began the year mixed, but gradually gained strength as
recovery in Japan and the Far East took hold, and merger activity swept across
Europe and the United Kingdom. The key to the strong performance of the Fund was
stock selection and sector allocation. In Asia, large-cap stocks tended to
outperform, benefiting from a wave of restructuring across the region. Exposure
to capital equipment, electronics, telecommunications, and technology stocks
helped the Fund.
In Europe, merger activity and corporate restructuring aided the Fund
throughout the year. Technology and telecom stocks gained strength near the end
of the year and helped fund returns. Returns from European investments were
reduced by a 6% depreciation in the euro/dollar exchange rate, and U.K. markets
were hampered by interest rate worries.
For the year ahead we expect Europe and Asia to see further support from
economic recovery and corporate restructuring. The U.K. may continue to
underperform, constrained by rising interest rates and heavy pressure on
corporate profit margins. We also expect the strong technology rally to continue
in 2000.
IN EXCHANGE FOR GREATER POTENTIAL REWARDS, FOREIGN INVESTMENTS INVOLVE GREATER
RISK THAN U.S. INVESTMENTS. THESE RISKS INCLUDE POLITICAL AND ECONOMIC
UNCERTAINTIES OF FOREIGN COUNTRIES AND CURRENCY FLUCTUATIONS. THESE RISKS MAY BE
MAGNIFIED IN COUNTRIES WITH EMERGING MARKETS, SINCE THOSE COUNTRIES MAY HAVE
RELATIVELY UNSTABLE GOVERNMENTS AND LESS ESTABLISHED ECONOMIES.
* THE MSCI EAFE INDEX IS AN UNMANAGED INDEX, INCURRING NO SALES CHARGES,
EXPENSES, OR FEES. PAST PERFORMANCE OF AN INDEX IS NOT A GUARANTEE OF
FUTURE RESULTS. IT IS NOT POSSIBLE TO INVEST DIRECTLY IN AN INDEX.
PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. All performance figures
represents total returns and average annual total returns for the periods ended
12/31/99. Investment performance represents total return and assumes
reinvestment of all dividend and capital gain distributions. The investment
value and principal value of an investment will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original cost. The
Investment Adviser waived a portion of its management fees and/or reimbursed
expenses in order to reduce the operating expenses of The International Equity
Fund during each of the periods shown above. To obtain a prospectus containing
more complete information about The Flex-Partners Funds, including other fees
and expenses that apply to a continued investment in the Funds, you may call The
Flex-Partners at (800)494-3539 or write P.O. Box 7177, Dublin OH 43017. Please
read the prospectus carefully before investing.
1999 PERFORMANCE
Period & Average Annual Total Returns as of 12/31/99
- -----------------------------------------------------------
Before Sales Charges
- -----------------------------------------------------------
One Year 30.07%
Life of Fund* 19.65%
- -----------------------------------------------------------
- -----------------------------------------------------------
Net of Sales Charges**
- -----------------------------------------------------------
One Year 22.61%
Life of Fund* 16.65%
- -----------------------------------------------------------
* Inception Date 9/2/97.
** Reflects deduction of 5.75% maximum sales charge.
[GRAPH] The following information was presented as a pie chart:
REGIONAL HOLDINGS as of 12/31/99
1) Europe (ex. U.K.) 48.61%
2) Japan 27.01%
3) United Kingdom 18.67%
4) Pacific Rim (ex Japan) 3.33%
5) Australia/New Zealand 2.38%
<PAGE>
INTERNATIONAL EQUITY FUND
PORTFOLIO OF INVESTMENTS AS OF DECEMBER 31, 1999
<TABLE>
<CAPTION>
SHARES OR FACE
INDUSTRIES/CLASSIFICATIONS AMOUNT VALUE
-------------------------- ------ -----
<S> <C> <C>
COMMON STOCKS - 100.0%
ADVERTISING - 0.8%
Telefonica Publicidad e Informacion, SA# 2,800 $ 135,620
WPP Group PLC 2,620 41,525
177,145
AEROSPACE/DEFENSE - 0.6%
British Aerospace PLC 12,118 80,269
Finmeccanica Spa # 60,000 68,663
148,932
AIR TRANSPORT - 0.3%
Cathay Pacific Airways 6,000 10,690
Japan Airlines Co. 10,000 29,639
Singapore Airlines Ltd. 2,500 28,361
68,690
APPAREL - 0.2%
Alexon Group PLC # 3,181 5,910
Espirit Holdings Ltd. 12,000 12,967
Onward Kashiyama Co., Ltd. 2,000 27,389
46,266
AUTO & TRUCK - 3.2%
Autobacs Seven 300 9,831
Daimler Chrysler AG 1,700 131,575
GKN Ord. 2,934 46,217
Honda Motor Co., Ltd. 2,000 74,342
Nissan Motor Co., Ltd. 7,000 27,526
Toyota Motor Corp. 9,000 435,782
725,273
AUTOPARTS - 0.3%
Denso Corp. 3,000 71,603
BANKING - 12.6%
Abbey National PLC # 2,519 40,290
Allied Irish Banks PLC 7,632 86,727
Argentaria, Caja Postal y Banco 4,000 93,679
Hipotecario de Espana, SA
Asahi Bank Ltd. 5,000 30,813
Banca Nazionale del Lavoro # 31,440 104,467
Bank of Fukuoka Ltd. 4,000 27,741
Bank of Tokyo-Mitsubishi Ltd. 7,000 97,506
Bank of Yokohama Ltd. 5,000 23,036
Banque Nationale de Paris 750 68,965
Barclays PLC 3,548 102,147
Chiba Bank Ltd. 6,000 33,219
Christiania Bank Og Kreditkasse 19,100 93,931
Commonwealth Bank of Australia 2,050 35,325
Credit Lyonnais # 1,600 72,920
Credit Suisse Group 500 99,497
Dai-Ichi Kangyo Bank Ltd. 6,000 56,050
Daiwa Bank Ltd. 6,000 17,607
DBS Group Holdings Ltd. 2,395 39,246
Deutsche Bank AG 1,720 145,468
Entrium Direct Bankers AG # 4,700 71,715
Halifax PLC 3,230 35,824
Hang Seng Bank Ltd. 3,600 41,101
<PAGE>
SHARES OR FACE
INDUSTRIES/CLASSIFICATIONS AMOUNT VALUE
-------------------------- ------ -----
HSBC Holdings PLC 20,157 281,194
HypoVereinsbank AG 1,400 95,988
Industrial Bank of Japan Ltd. 6,000 57,811
ING Groep NV 2,796 168,238
Malayan Banking Bhd 2,000 7,106
Mitsubishi Trust 2,000 17,607
National Australia Bank Ltd. 3,190 48,829
National Bank of Greece SA 780 57,593
Overseas-Chinese Banking Corp., Ltd. 3,150 28,929
Royal Bank of Scotland Group PLC 2,063 36,596
San Paolo - IMI SpA 5,600 75,835
Sanwa Bank Ltd. 4,000 48,636
Schroders PLC 975 19,627
Softbank Corp. 200 191,333
Sumitomo Bank Ltd. 9,000 123,164
Sumitomo Trust 4,000 26,998
Tokai Bank Ltd. 5,000 31,498
Unicredito Italiano Spa 25,000 122,470
United Overseas Bank Ltd. 2,112 18,635
2,875,361
BEVERAGE -- ALCOHOLIC - 0.5%
Bass PLC 2,244 27,934
Diageo PLC 7,240 58,251
Foster's Brewing Group Ltd. 8,300 23,828
Fraser & Neave Ltd. 1,000 3,692
113,705
BROADCASTING -- CABLE TV - 0.7%
British Sky Broadcasting Group PLC 3,910 62,949
Reuters Holdings PLC 4,268 58,576
Television Broadcasts Ltd. 1,000 6,818
Tokyo Broadcasting System, Inc. 1,000 33,845
162,188
BROADCASTING & PUBLISHING - 0.4%
Austar United Communications Ltd. # 3,900 15,629
News Corporation Ltd. 8,660 84,143
99,772
BUILDING & CONSTRUCTION - 1.8%
Acciona SA 1,500 84,324
AMEC plc 3,000 11,972
Compagnie de Saint Gobain 400 74,968
CRH PLC 5,040 108,271
Obayashi Corp. 14,000 66,145
RMC Group PLC 1,684 23,126
Sekisui House 3,000 26,558
Tostem Corp. 1,000 17,950
413,314
BUILDING MATERIALS - 0.1%
Meyer International PLC 2,150 13,356
CHEMICALS - 1.6%
Clariant 215 102,600
Denki Kagaku Kogyu 7,000 20,884
Imperial Chemical Industries 2,150 22,769
Laporte 1,130 9,858
Nippon Sanso Corp. 4,000 11,738
SGL Carbon AG 1,000 66,254
Shin-Etsu Chemical Co., Ltd. # 3,000 129,121
363,224
<PAGE>
SHARES OR FACE
INDUSTRIES/CLASSIFICATIONS AMOUNT VALUE
-------------------------- ------ -----
CHEMICALS -- DIVERSIFIED - 1.5%
Aventis SA 4,550 262,281
BOC Group PLC 530 11,388
Dainippon Ink & Chemicals 3,000 8,892
Henkel KGaA 1,150 75,615
358,176
COMPUTERS & PERIPHERALS - 2.9%
Atos SA # 425 70,224
Fujitsu Ltd. 5,000 227,918
Itochu Techno-Science Corp. 100 62,310
Logica PLC 1,630 42,056
Misys PLC 2,982 46,491
NEC Corp. 3,000 71,457
Netcom AB # 1,150 81,060
The Sage Group PLC # 4,790 58,466
659,982
CONTAINERS -- PAPER & PLASTIC - 0.1%
Bunzl PLC 6,100 33,606
CONSUMER DURABLES - 0.2%
Unilever PLC 6,582 48,437
COSMETICS - 0.4%
Kao Corp. 3,000 85,542
DATA PROCESSING - 0.0%
Industri-Matematik International Corp. - 2,000 12,250
ADR #
DISTRIBUTION WHOLESALER - 0.3%
Marubeni Corp. 10,000 41,964
Mitsui & Co. 5,000 34,970
76,934
DIVERSIFIED - 2.8%
Arriva PLC 146 571
Bodycote International PLC 1,407 6,797
Brambles Industries Ltd. 1,050 29,056
Broken Hill Proprietary Co., Ltd. 3,850 50,588
Granada Group PLC 2,954 29,947
Hays PLC 900 14,337
Hutchison Whampoa Ltd. 8,000 116,293
Invensys PLC 8,738 47,575
Lagardere SCA 2,000 108,416
Mitsubishi Corp. 5,000 38,589
Swire Pacific Ltd. 3,000 17,714
Vivendi 2,000 179,990
639,873
DRUG - 2.1%
Pharmacia & Upjohn, Inc. 1,700 77,347
Rhodia SA 4,050 91,232
Roche Holdings AG 7 83,181
Sankyo Co., Ltd. 2,000 41,084
Smithkline Beecham PLC 13,842 176,669
469,513
ELECTRIC PRODUCTION -- MISCELLANEOUS - 1.5%
Chubu Electric Power Co., Inc. 1,800 29,316
CLP Holdings Ltd. 7,500 34,540
<PAGE>
SHARES OR FACE
INDUSTRIES/CLASSIFICATIONS AMOUNT VALUE
-------------------------- ------ -----
Hitachi Ltd. 11,000 176,465
Sanyo Electric Co., Ltd. 9,000 36,535
Scottish Power PLC 4,963 37,605
Tenaga Nasional Bhd 1,000 2,579
Tokyo Electric Power Co. 1,400 37,523
354,563
ELECTRONIC COMPONENT -- MISCELLANEOUS - 7.4%
Arm Holdings PLC # 220 14,846
Electrocomponents PLC 2,150 23,811
Epcos AG # 970 72,543
Hirose Electric Co., Ltd. 500 112,051
Idec Izumi Corp. 2,000 22,890
Johnson Electric Holdings Ltd. 2,000 12,838
Kyocera Corp. 700 181,454
Mabuchi Motor Co., Ltd. 900 156,970
Matsushita Electric Industrial Co., Ltd. 4,000 110,731
Minebea Co., Ltd. 2,000 34,295
Murata Manufacturing Co., Ltd. 1,000 234,765
Perlos Oyj # 4,000 140,539
Sony Corp. 1,000 296,390
STMicroelectronics NV 1,100 168,727
Sumitomo Electric Industries 4,000 46,210
Yakult Honsha Co., Ltd. 6,000 52,235
1,681,295
ENGINEERING RESEARCH & DEVELOPMENT - 0.1%
Sembcorp Industries Ltd. 3,000 4,088
Singapore Technologies Engineering Ltd. 6,000 9,292
13,380
ENTERTAINMENT/MEDIA - 0.3%
Pearson PLC 2,146 69,480
FINANCE - 1.8%
Acom Co., Ltd. 500 48,958
Lend Lease Corp., Ltd. 1,300 18,225
Lloyds TSB Group PLC 12,052 150,805
Nomura Securities Co., Ltd. 5,000 90,238
Orix Corp. 100 22,518
Takefuji Corp. 400 50,044
380,788
FINANCIAL SERVICES - 0.8%
Daiwa Securities Group, Inc. 4,000 62,565
Legal & General Group PLC 16,724 45,528
Unidanmark A/S 1,150 81,105
189,198
FOOD -- DIVERSIFIED - 2.7%
Cadbury Schweppes PLC 5,920 35,771
Carrefour SA 750 137,854
Danone 300 70,470
Nestle SA 100 183,401
Nippon Meat Packers, Inc. 2,000 25,922
Nissin Food Products 1,000 23,525
Royal Canin SA 1,300 91,285
Tesco PLC 16,517 50,234
618,462
HOTEL/GAMING - 0.7%
Accor SA 2,800 134,833
<PAGE>
SHARES OR FACE
INDUSTRIES/CLASSIFICATIONS AMOUNT VALUE
-------------------------- ------ -----
Genting Bhd 1,000 3,553
Hilton Group PLC 6,073 19,451
157,837
HOUSEHOLD PRODUCTS - 1.3%
Asahi Glass Co., Ltd. 5,000 38,687
Electrolux AB 4000 100,897
Hunter Douglas NV 2,714 73,560
Societe Europeenne des Satellites 500 72,779
285,923
INSURANCE -- MULTILINE - 0.6%
Allied Zurich AG # 3,516 41,439
Prudential Corp., PLC 3,625 71,450
Royal & Sun Alliance Insurance Group PLC 3,477 26,486
139,375
INSURANCE - 2.3%
Axa 1,050 145,879
Fortis AG 2,500 89,895
Muenchener Rueckversicherungs - 430 108,561
Gesellschaft AG
Skandia Forsakrings AB 4,500 136,317
Tokio Marine & Fire Insurance Co. 4,000 46,757
527,409
INTERNET -- SOFTWARE - 0.8%
Brokat Infosystems AG # 520 104,922
Freenet.de AG # 750 82,065
186,987
INVESTMENT COMPANIES - 0.5%
Amvescap PLC 1,100 12,796
NH Hoteles SA # 7,000 78,561
Parques Reunidos SA # 3,000 16,262
Sime Darby Bhd 1,000 1,269
108,888
MACHINERY - 3.0%
Amada Co., Ltd. 6,000 32,808
Kubota Corp. 11,000 42,072
Mannesmann AG 1,200 290,313
Schneider Electric SA 1,500 117,375
Sidel SA 750 77,171
Toshiba Machine Co., Ltd. 15,000 24,210
Usinor SA 5,000 93,609
677,558
MANUFACTURING - 2.0%
ABB Ltd. # 891 109,099
FKI PLC 4,770 18,495
Mitsubishi Heavy Industries Ltd. 9,000 30,021
NTN Corp. 8,000 23,633
Siemens AG 1,200 152,686
Veba AG 2,500 120,889
454,823
MEDICAL PRODUCTS - 3.6%
AstraZeneca Group PLC 4,068 168,776
Glaxo Wellcome PLC 7,537 213,094
Novartis AG 215 316,045
Takeda Chemical Industries 2,000 98,797
Terumo Corp. 1,000 26,704
823,416
<PAGE>
SHARES OR FACE
INDUSTRIES/CLASSIFICATIONS AMOUNT VALUE
-------------------------- ------ -----
MINING - 0.5%
Mitsui Mining & Smelting Co., Ltd. 5,000 23,623
Rio Tinto Ltd. 1,590 34,179
Rio Tinto PLC 2,260 54,586
112,388
NETWORKING PRODUCT - 0.5%
Equant NV # 1,000 113,134
OFFICE AUTOMATION & EQUIPMENT - 0.3%
Canon, Inc. 2,000 79,429
OIL & NATURAL GAS - 7.1%
Amp Ltd. 2,140 23,661
BG PLC 7,196 46,501
British Petroleum Co., PLC 44,658 449,130
Centrica PLC # 12,070 34,223
ENI SpA 16,650 91,259
Hong Kong & China Gas Co., Ltd. 8,800 12,056
LASMO PLC 6,900 13,126
Nippon Oil Co. 4,000 17,607
PowerGen PLC 1,900 13,660
Repsol - YPF, SA 6,500 150,206
Royal Dutch Petroleum Co. 5,250 320,692
Shell Transport & Trading Co. 1,618 13,449
Tokyo Gas Co. 23,000 56,021
Total Fina SA 2,748 365,512
1,607,103
OPTICAL SUPPLIES - 0.1%
Paris Miki, Inc. 400 28,720
PAPER & FOREST PRODUCTS - 1.5%
Nippon Paper Industries Co., Ltd. 2,000 11,014
Stora Kopparbergs Bergslags Aktiebolag 14,877 256,019
UPM - Kymmene Oyj 1,600 64,246
331,279
PRINTING -- COMMERCIAL - 0.2%
Dai Nippon Printing Co., Ltd. 3,000 47,833
PROTECTION -- SAFETY EQUIPMENT - 0.5%
Secom Co., Ltd. 1,000 110,046
PUBLISHING - 1.0%
Johnston Press PLC 2,046 12,065
Singapore Press Holdings Ltd. 946 20,499
South China Morning Post Holdings Ltd. 9,000 7,757
Verenigde Nederlandse Uitgeversbedrijven 3,400 178,095
Verenigd Bezit
218,416
REAL ESTATE MANAGEMENT & INVESTMENT - 1.5%
British Land Co., PLC 3,668 24,297
Chelsfield PLC 1,620 8,218
Cheung Kong Holdings Ltd. 6,000 76,221
City Developments Ltd. 4,000 23,409
DBS Land Ltd. 1,000 1,969
HKR International Ltd. 12,080 8,469
Land Securities PLC 2,094 23,478
Mitsubishi Estate Co., Ltd. 9,000 87,773
New World Development Co., Ltd. 4,000 9,005
Sun Hung Kai Properties Ltd. 5,000 52,100
Westfield Holdings Ltd. 4,200 26,157
341,096
<PAGE>
SHARES OR FACE
INDUSTRIES/CLASSIFICATIONS AMOUNT VALUE
-------------------------- ------ -----
RECREATION - 0.2%
TAB Ltd. 9,590 17,514
TABCORP Holdings Ltd. 2,800 18,972
36,486
RETAIL - 0.8%
Coles Myer Ltd. 3,200 16,540
Cycle & Carriage Ltd. 1,000 3,091
Isetan Co., Ltd. 7,000 51,355
Matalan PLC 600 16,503
Next PLC 2,200 21,113
Otsuka Kagu Ltd. 200 53,800
Ryohin Keikaku Co. Ltd. 100 20,063
182,465
RETAIL GROCERY - 0.7%
Ito-Yokado Co., Ltd. 1,000 108,579
Superdiplo SA # 3,000 57,219
165,798
RETAIL STORE - 0.2%
Debenhams PLC 1,627 5,099
Kingfisher PLC 3,277 36,372
41,471
SHIP BUILDING - 0.0%
Keppel Corp., Ltd. 2,000 5,234
STEEL -- INTEGRATED - 0.6%
Corus Group PLC 9,900 25,751
Kawasaki Steel Corp. 23,000 41,172
Nippon Steel Corp. 28,000 65,460
132,383
TELECOMMUNICATIONS - 5.9%
Cable & Wireless PLC 26,062 75,268
DDI Corp. 1 13,695
Deutsche Telekom AG 3,500 251,213
Europolitan Holdings AB 3,500 61,882
Fujikura 7,000 27,800
Nippon Telegraph & Telephone Corp. 27 462,193
Portugal Telecom SA 12,800 139,929
PT Multimedia # 1,250 70,859
Singapore Telecommunications Ltd. 12,000 24,778
Swisscom AG 170 68,834
Telecom Corporation of New Zealand Ltd. 7,300 34,249
Telestra Corp., Ltd. # 1,100 3,881
Versatel Telecom International NV # 3,000 105,404
1,339,985
TELECOMMUNICATION EQUIPMENT - 8.6%
Alcatel Alsthom 950 217,434
France Telecom SA 2,700 355,875
Marconi PLC 5,158 91,291
Nokia Oyj 2,850 514,975
Telefonaktiebolaget LM Ericsson 4,900 315,928
Teleste Corp. 6,325 102,859
Vodafone AirTouch PLC 72,805 360,811
1,959,173
TELECOMMUNICATION SERVICES - 4.1%
British Telecommunications PLC 14,574 356,247
<PAGE>
SHARES OR FACE
INDUSTRIES/CLASSIFICATIONS AMOUNT VALUE
-------------------------- ------ -----
China Telecom Ltd. # 2,000 12,504
KPNQwest NV # 2,500 165,886
Rank Group PLC 2,537 8,034
Sonera Group Oyj 2,500 170,780
Telekom Malaysia Bhd 1,000 3,869
Telestra Corp., Ltd. 11,300 61,467
Thus PLC # 2,000 12,537
United Pan-Europe Communications NV # 1,100 140,238
931,562
TEXTILE PRODUCTS - 0.1%
Toray Industries, Inc. 3,000 11,621
TOBACCO - 0.2%
British American Tobacco Bhd 200 1,527
British American Tobacco PLC 6,120 34,779
36,306
TRANSPORTATION - 1.6%
East Japan Railway Co. 9 48,508
Malaysia International Shipping Bhd 1,000 1,645
National Express Group PLC 989 11,664
Neptune Orient LNS # 2,000 2,677
Nippon Yusen KK 6,000 24,533
Peninsular and Oriental Steam Navigation Co. 2,449 40,872
Railtrack Group PLC 1,999 33,588
Stagecoach Holdings PLC 2,700 6,958
TNT Post Group NV 2,220 63,402
Tokyu Corp. 6,000 14,614
Yamato Transport Co., Ltd. 3,000 116,209
364,670
TRAVEL SERVICES - 0.8%
Airtours PLC 1,880 11,542
Amadeus Global Travel Distribution SA # 10,750 169,964
181,506
WATER UTILITY - 0.2%
Kurita Water Industries Ltd. 2,000 31,772
Severn Trent PLC 568 5,644
37,416
TOTAL COMMON STOCKS
(Cost $17,080,297 ) 22,748,044
TOTAL INVESTMENTS - 100.0%
(Cost $17,080,297 ) 22,748,044
TRUSTEE DEFERRED COMPENSATION*
Flex-funds Highlands Growth Fund 223 4,977
Flex-funds Muirfield Fund 348 2,200
Flex-funds Total Return Utilities Fund 74 1,497
Flex-Partners International Equity Fund 173 2,973
TOTAL TRUSTEE DEFERRED COMPENSATION
(Cost $10,980 ) $11,647
</TABLE>
<PAGE>
ADR: American Depositary Receipt
# Represents non-income producing securities.
* Assets of affiliates to the International Equity Fund held for the benefit
of the Portfolio's Trustees in connection with the Trustee Deferred
Compensation Plan.
Portfolio Composition by Country of Domicile as of 12/31/99.
Australia - 2.23% Malaysia - 0.09%
Belgium - 0.71% Netherlands - 5.35%
Denmark - 0.36% New Zealand - 0.15%
Finland - 4.36% Norway - 0.41%
France - 13.18% Portugal - 0.93%
Germany - 8.50% Singapore - 0.94%
Greece - 0.25% Spain - 2.79%
Hong Kong - 2.30% Sweden - 4.52%
Ireland - 0.86% Switzerland - 4.23%
Italy - 2.03% United Kingdom -
Japan - 27.01% United States - 0.13%
See accompanying notes to financial statements.
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
INTERNATIONAL
EQUITY
FUND
Assets:
Investments, at value (cost $17,080,297) $22,748,044
Cash 717,323
Receivable for capital stock issued 8,493
Dividends, interest and tax reclaims
receivable, at value 49,180
Receivable from investment adviser 10,190
Unamortized organization costs 15,553
Trustee Deferred Compensation Plan asset, 11,647
at value ($10,980)
Other assets 7,220
Total Assets 23,567,650
Liabilites:
Accrued management fees 18,652
Accrued fund accounting fees 2,361
Accrued transfer agent fees 1,787
Accrued administrative fees 1,359
Accrued 12b-1 distribution and shareholder service fees 27,506
Trustee Deferred Compensation Plan, at value 11,647
Other accrued liabilities 30,212
Total Liabilities 93,524
Net Assets $23,474,126
Components of Net Assets:
Capital $17,359,464
Accumulated undistributed net realized gains
from investment and foreign currency transactions 446,914
Net unrealized appreciation of
investments and foreign currency 5,667,748
Total Net Assets $23,474,126
Outstanding units of beneficial interest (shares): 1,351,211
Net asset value -- redemption price per share: $17.37
Maximum sales charge 5.75%
Maximum offering price per share
(100%/(100% - sales charge) of net asset value
adjusted to nearest cent) $18.43
See accompanying notes to financial statements.
<PAGE>
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1999
INTERNATIONAL
EQUITY
FUND
Investment Income:
Interest $2,759
Dividends 364,500
Foreign taxes withheld (38,471)
Total Investment Income 328,788
Expenses:
Investment management fees 191,375
Administration fees 9,569
Distribution (12b-1) fees 45,690
Fund accounting fees 29,999
Transfer agent fees 19,138
Audit fees 16,870
Legal fees 1,109
Custody fees 106,725
Trustees fees and expenses 9,570
Postage expense 1,233
Registration expense 8,731
Printing expense 3,248
Amortization of organizational costs 5,825
Other expenses 4,650
Total Expenses 453,732
Expenses reimbursed by investment adviser (70,780)
Net Expenses 382,952
NET INVESTMENT LOSS (54,164)
NET REALIZED AND UNREALIZED GAINS
FROM INVESTMENTS:
Net realized gains from investments
and foreign currency transactions 2,041,862
Net change in unrealized appreciation
of investments 3,448,137
NET GAIN FROM INVESTMENTS 5,489,999
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $5,435,835
See accompanying notes to financial statements.
STATEMENT OF CHANGES IN NET ASSETS
Year Ended Year Ended
12/31/99 12/31/98
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss) ($54,164) ($29,201)
Net realized gains from investment and
futures contract transactions 2,041,862 381,420
Net change in unrealized appreciation
of investments 3,448,137 2,333,615
Net increase in net assets
resulting from operations 5,435,835 2,685,834
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
In excess of net investment income --- (50,938)
From net realized gains (1,691,362) (98,118)
Net decrease in net assets resulting
from dividends and distributions (1,691,362) (149,056)
CAPITAL TRANSACTIONS:
Issued 1,527,830 5,048,139
Reinvested 1,622,117 149,026
Redeemed (1,693,662) (1,650,643)
Net increase (decrease) in net assets
resulting from capital share
transactions 1,456,285 3,546,522
TOTAL INCREASE IN NET ASSETS 5,200,758 6,083,300
NET ASSETS - Beginning of period 18,273,368 12,190,068
NET ASSETS - End of period $23,474,126 $18,273,368
SHARE TRANSACTIONS:
Issued 99,602 376,007
Reinvested 99,846 10,299
Redeemed (111,391) (123,624)
Change in shares 88,057 262,682
See accompanying notes to financial statements.
<PAGE>
FINANCIAL HIGHLIGHTS
INTERNATIONAL EQUITY FUND
Year ended Year ended 9/2/97* to
12/31/99 12/31/98 12/31/97
Net Asset Value, Beginning of Period $14.47 $12.18 $12.50
Income from Investment Operations:
Net investment loss (0.04) (0.02) (0.02)
Net gains (losses) from investments 4.31 2.43 (0.30)
Total from investment operations 4.27 2.41 (0.32)
Less Dividends and Distributions:
In excess of net investment income --- (0.04) ---
From net realized gains (1.37) (0.08) ---
Total distributions (1.37) (0.12) ---
Net Asset Value, End of Period $17.37 $14.47 $12.18
Total Return 30.07% 19.78% (2.56%)(1)
Ratios/Supplementary Data
Net assets, end of period ($000) $23,474 $18,273 $12,190
Ratio of expenses to
average net assets 2.00% 2.00% 2.00%(2)
Ratio of net investment loss to
average net assets -0.28% -0.18% (0.43%)(2)
Ratio of expenses to average net assets
before waiver of fees 2.37% 2.17% 2.68%(2)
Ratio of net investment loss to average
net assets before waiver of fees -0.65% -0.35% (1.11%)(2)
Portfolio turnover 72.52% 86.13% 12.71%
* Date of commencement of operations
(1) Not Annualized
(2) Annualized
See accompanying notes to financial statements.
<PAGE>
INTERNATIONAL EQUITY FUND ANNUAL REPORT
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
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. Only the financial
statements of The International Equity Fund (the "Fund") are in this report.
The investment objective of the Fund is to seek long-term growth from investing
primarily in equity securities of foreign issuers.
2. SIGNIFICANT ACCOUNTING POLICIES
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
Securities owned by the Fund are valued at 3:00 pm Eastern Time based on the
last sales price, or, lacking any sales, at the closing bid prices. The Fund
obtains prices from independent pricing services which use valuation techniques
approved by the Board of Trustees. If prices cannot be obtained through
independent pricing services, methods of valuation are used that have been
approved by the Board of Trustees.
REPURCHASE AGREEMENTS
The Fund may engage in repurchase agreement transactions whereby the Fund takes
possession of an underlying debt instrument subject to an obligation of the
seller to repurchase the instrument from the Fund and an obligation of the Fund
to resell the instrument at an agreed upon price and term. At all times, the
Fund 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 Fund may be delayed or limited.
DEFERRED TRUSTEE COMPENSATION
Under a Deferred Compensation Plan (the "Plan") non-interested Trustees may
elect to defer receipt of a portion of their annual compensation. Under the
Plan, deferred amounts are invested in the shares of the Flex-funds and
Flex-Partners Funds. Deferred amounts remain in the funds until distributed in
accordance with the Plan.
FOREIGN CURRENCY TRANSLATION
Accounting records of the Funds are maintained in U.S. dollars. The value of
securities, other assets and liabilities of the Fund denominated in foreign
currency are translated into U.S. dollars at the current exchange rate.
Purchases and sales of securities, income receipts and expense payments are
translated into U.S. dollars at the exchange rate on the dates of such
transactions. The Fund does not isolate that portion of the results of
operations resulting from changes in foreign exchange rates from those resulting
from changes in market prices of securities held.
FORWARD CURRENCY CONTRACTS
The Fund may enter into forward foreign currency exchange contracts ("forwards")
for purposes of hedging against either specific transactions or portfolio
positions. Forwards are agreements between two parties to exchange currencies at
a set price on a future date. The market value of forwards fluctuates with
changes in currency exchange rates. The forward is marked-to-market daily, and
the change in market value is recorded by the Fund as unrealized appreciation or
depreciation. When the forward is offset by entry into a closing transaction or
extinguished by delivery of the currency, the Fund records a realized gain or
loss equal to the fluctuation in value during the period the forward was open.
Risks may arise upon entering forwards from the potential inability of
counterparties to meet the terms of the forwards or from unanticipated
fluctuations in the value of the foreign currency relative to the U.S. dollar.
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 and distributes net capital gains,
if any, on an annual basis.
<PAGE>
Distributions from net investment income and from net capital gains are
determined in accordance with Federal income tax regulations which may differ
from generally accepted accounting principles. These differences are primarily
due to deferrals of certain losses, expiring capital loss carryforwards, and
differing treatment of gains and losses realized in transactions denominated in
foreign currency. Accordingly, timing differences relating to shareholder
distributions are reflected in the components of net assets and permanent book
and tax differences relating to shareholder distributions have been reclassified
to capital.
ORGANIZATIONAL COSTS
The costs related to the organization of the Fund have been deferred and are
being amortized on a straight-line basis over a five-year period.
EXPENSES
The Fund accrues its own expenses. Expenses incurred by the Trust that do not
specifically relate to an individual fund of the Trust are allocated to the Fund
based on its 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 Fund with investment management, research, statistical
and advisory services. For such services, the Fund pays monthly fees at the
annual rate of 1.00% of the average daily net asset value of the Fund. Under an
Investment Subadvisory Agreement with RMA, Commercial Union Investment
Management, Ltd serves as subadviser of the Fund. As subadviser, Commercial
Union Investment Management, Ltd. is paid 1.00% of the 1.00% of average daily
net assets up to $10 million, 0.30% of the 1.00% of average daily net assets
exceeding $10 million up to $20 million, and 0.65% of the 1.00% of average daily
net assets exceeding $20 million.
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 $15 per active shareholder account or 0.10% of the Fund's average
daily net assets. MFSCo is entitled to receive an annual minimum fee of $4,000
from the Fund.
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 (excluding interest, taxes, brokerage fees, and extraordinary expenses)
exceed certain limitations. Such reimbursement is limited to the total of fees
charged to the Fund by RMA and MFSCo. The Fund currently has a 2.00% annual
expense limitation as a percentage of average daily net assets.
Certain officers and trustees of the Fund are also officers or directors of MII,
RMA and MFSCo.
Pursuant to Rule 12b-1 of the Act, the Fund has adopted a Distribution Plan with
Adviser Dealer Services (the "Distributor"). Under the provisions of the
Distribution Plan, the Fund pays the Distributor an annual fee, at a maximum
rate of 0.25% of average daily net assets to aid in the distribution of Fund
shares. Additionally, the Fund has adopted a Service Plan with the Distributor.
Under the provisions of the Service Plan, the Fund pays the Distributor an
annual fee, at a maximum rate of 0.25% of average daily net assets to reimburse
securities dealers for personal services or maintenance of shareholder accounts.
4. SECURITIES TRANSACTIONS
For the year ended December 31, 1999, the cost of purchases and proceeds from
sales or maturities of long-term investments for the Fund were $13,730,741 and
$14,232,933, respectively. The cost of investments for Federal income tax
purposes and for financial reporting purposes is substantially the same.
5. FEDERAL TAX INFORMATION (Unaudited)
During the year ended December 31, 1999, the Fund declared long-term capital
gain distributions in the amount of $982,477.
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Shareholders and Board of Trustees
The Flex-Partners Trust
We have audited the accompanying statements of assets and liabilities of The
Flex-Partners Trust - International Equity Fund (Fund) including the portfolio
of investments, as of December 31, 1999, and the related statement of
operations, statements of changes in net assets and the financial highlights for
each of the periods indicated herein. These financial statements and the
financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included verification of securities owned as of
December 31, 1999, by confirmation with the custodian and other appropriate
audit procedures. 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 our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of The
Flex-Partners Trust - International Equity Fund at December 31, 1999, and the
results of its operations, the changes in its net assets and the financial
highlights for each of the periods indicated herein, in conformity with
generally accepted accounting principles.
KPMG LLP
Columbus, Ohio
February 11, 2000
