The Arbor Fund
Semi-Annual Report
---------------------
AS OF JULY 31, 1998
[LOGO OMITTED]
Golden Oak
Family of Funds
ADVISED BY
CITIZENS BANK
<PAGE>
TABLE OF CONTENTS
Letter to Shareholders ................................ 2
Statements of Net Assets .............................. 3
Statement of Operations ............................... 17
Statement of Changes in Net Assets .................... 18
Financial Highlights .................................. 20
Notes to Financial Statements ......................... 22
<PAGE>
Dear Shareholder:
The stock market and the economy have continued to forge ahead. Consumer
spending has grown at a rapid pace, reflecting the tight labor market and the
so-called wealth effect, which tends to result in more spending and less saving
when retirement accounts and personal investment portfolios exceed expectations.
At the same time, however, the export and manufacturing sectors of our economy
are slowing considerably as a result of Asian countries becoming better
suppliers to us and worse customers for our goods. Could we be catching the
"Asian flu"?
The stronger competition and reduced demand from the Far East is seriously
weakening the profit margins of U.S. companies, but analysts have expected this
to be a short-lived phenomenon. As corporate executives warn of more earnings
problems ahead, however, and the 3% growth of the first half is compared to a
consensus earnings forecast of 10 to 12% for the fourth quarter, confidence in
the forecast has begun to fade. The typical institutional investor has also lost
some confidence that the current level of stock prices offers adequate value.
While the schizophrenia in the economy has definitely increased the uncertainty
factor, long-term investors should resist the urge to "cut and run" -- even if
stocks move sharply lower. We firmly believe that patience and a willingness to
do some buying at "fire sale" prices will prove to be rewarding over time.
We are delighted to have the Golden Oak Growth Portfolio favorably featured in
recent interviews, research reports and rankings of top-performing funds. The
Value Line Mutual Fund Survey, Standard & Poor's Mutual Fund Reports and
Barron's have all included the Growth Portfolio in recent publications. In the
Lipper universe of 884 growth funds, for example, Golden Oak Growth (Class I
shares) was ranked 35th with a total investment return of 41.8% for the year
ended June 30, 1998. That's top 4% performance!
Once again we want to thank you for investing in the Golden Oak Funds. You have
our constant commitment to add value to that investment.
Sincerely,
/S/Signature Omitted
Dana A. Czmer
Senior Vice President & Trust Officer
Citizens Bank
2
<PAGE>
STATEMENT OF NET ASSETS GOLDEN OAK FAMILY OF FUNDS
July 31, 1998 Unaudited
GROWTH Value
PORTFOLIO Shares (000)
- -----------------------------------------------------
COMMON STOCKS -- 95.5%
AIR TRANSPORTATION -- 1.2%
AMR* ............................ 7,400 $ 529
------
AIRCRAFT -- 2.5%
General Dynamics ................ 18,200 866
United Technologies ............. 2,200 211
------
Total Aircraft .......... 1,077
------
APPAREL/TEXTILES -- 1.3%
Jones Apparel Group* ............ 21,200 554
------
AUTOMATION & CONTROL SYSTEMS -- 2.2%
Honeywell ....................... 11,500 964
------
AUTOMOTIVE -- 0.4%
Eaton ........................... 2,700 176
------
BANKS -- 1.7%
State Street Boston ............. 10,700 742
------
BEAUTY PRODUCTS -- 2.8%
Procter & Gamble ................ 15,500 1,230
------
BEVERAGES -- 2.1%
Pepsico ......................... 23,100 896
------
BROADCASTING, NEWSPAPERS & ADVERTISING -- 2.0%
Omnicom Group ................... 16,800 882
------
CHEMICALS -- 0.7%
Avery Dennison .................. 5,500 317
------
COMMUNICATIONS EQUIPMENT -- 2.7%
Lucent Technologies ............. 12,400 1,146
------
COMPUTER SOFTWARE -- 3.0%
Compuware* ...................... 15,400 829
Microsoft* ...................... 4,400 484
------
Total Computer Software . . 1,313
------
COMPUTERS & SERVICES -- 7.4%
Cisco Systems* .................. 4,800 460
Compaq Computer ................. 10,300 339
Dell Computer* .................. 17,700 1,922
EMC* ............................ 5,400 265
Sun Microsystems* ............... 5,000 236
------
Total Computers & Services 3,222
------
GROWTH Value
PORTFOLIO (continued) Shares (000)
- ----------------------------------------------------
COSMETICS -- 2.3%
Estee Lauder .................... 6,800 $ 437
Gillette ........................ 10,600 555
------
Total Cosmetics ......... 992
------
DRUGS -- 11.1%
Abbott Laboratories ............. 11,000 457
Eli Lilly ....................... 8,600 578
Pfizer .......................... 12,400 1,364
Schering Plough ................. 19,800 1,916
Warner Lambert .................. 6,900 521
------
Total Drugs ............. 4,836
------
ELECTRICAL & ELECTRONIC PRODUCTS -- 3.4%
General Electric ................ 16,500 1,474
------
ELECTRICAL UTILITIES -- 1.0%
AES* ............................ 9,800 449
------
ENTERTAINMENT -- 1.3%
Walt Disney ..................... 16,800 578
------
FINANCIAL SERVICES -- 7.8%
Capital One Financial ........... 7,300 847
Fannie Mae ...................... 20,000 1,240
Greenpoint Financial ............ 13,500 536
SLM Holding ..................... 16,800 777
------
Total Financial Services 3,400
------
FOOD, BEVERAGE & TOBACCO -- 4.7%
H.J. Heinz ...................... 3,500 193
Philip Morris ................... 17,800 780
Quaker Oats ..................... 16,800 888
Ralston Purina .................. 5,700 183
------
Total Food, Beverage & Tobacco 2,044
------
HEALTH SERVICES -- 5.7%
HBO & Company ................... 30,912 911
Health Management
Associates, Class A* 10,500 247
Healthsouth* .................... 7,200 181
McKesson ........................ 14,000 1,129
------
Total Health Services ... 2,468
------
INSURANCE -- 3.4%
Allstate ........................ 23,200 984
SunAmerica ...................... 4,800 295
The accompanying notes are an integral part of the financial statements.
3
<PAGE>
STATEMENT OF NET ASSETS (continued) GOLDEN OAK FAMILY OF FUNDS
July 31, 1998 Unaudited
GROWTH Value
PORTFOLIO (continued) Shares (000)
- -----------------------------------------------------
INSURANCE -- (CONTINUED)
Wellpoint Health Networks* ...... 3,200 $ 196
------
Total Insurance ......... 1,475
------
LUMBER & WOOD PRODUCTS -- 1.2%
Weyerhaeuser .................... 11,800 496
------
MACHINERY -- 1.3%
Caterpillar ..................... 11,500 558
------
MEDICAL SUPPLIES -- 1.5%
Becton Dickinson ................ 3,000 248
Guidant ......................... 5,500 409
------
Total Medical Supplies .. 657
------
PETROLEUM & FUEL PRODUCTS -- 2.5%
Exxon ........................... 6,600 463
Phillips Petroleum .............. 14,500 641
------
Total Petroleum & Fuel Products 1,104
------
PRINTING & PUBLISHING -- 2.7%
New York Times, Class A ......... 18,600 572
Tribune ......................... 8,900 598
------
Total Printing & Publishing 1,170
------
RETAIL -- 6.2%
Best Buy* ....................... 23,000 1,075
TJX ............................. 42,400 996
Wal-Mart Stores ................. 10,000 631
------
Total Retail ............ 2,702
------
SEMI-CONDUCTORS/INSTRUMENTS -- 2.6%
Intel ........................... 13,200 1,114
------
TELEPHONES & TELECOMMUNICATION-- 6.8%
A T & T ......................... 5,800 352
Airtouch Communications* ........ 21,000 1,235
America Online* ................. 3,200 374
Ameritech ....................... 5,600 275
BellSouth ....................... 4,900 335
Tellabs* ........................ 5,100 384
------
Total Telephones &
Telecommunication .... 2,955
------
Total Common Stocks
(Cost $31,547) ....... 41,520
------
Face
GROWTH Amount Value
PORTFOLIO (concluded) (000) (000)
- ------------------------------------------------------
REPURCHASE AGREEMENT -- 4.5%
J.P. Morgan (A)
5.58%, dated 07/31/98, matures
08/03/98, repurchase price
$1,979,418 (collateralized by
U.S. Treasury Bill: total market
value $2,018,144) ........... $1,978 $ 1,978
-------
Total Repurchase Agreement
(Cost $1,978) ........ 1,978
-------
Total Investments -- 100.0%
(Cost $33,525) ....... 43,498
-------
OTHER ASSETS AND LIABILITIES, NET-- 0.0% --
-------
NET ASSETS:
Portfolio Shares of Class I (unlimited
authorization -- no par value)
based on 2,845,631 outstanding
shares of beneficial interest 27,763
Portfolio Shares of Class A (unlimited
authorization -- no par value)
based on 30,640 outstanding
shares of beneficial interest 350
Undistributed net investment income 19
Accumulated net realized gain
on investments ............. 5,393
Net unrealized appreciation
on investments ............. 9,973
-------
Total Net Assets -- 100.0% ...... $43,498
=======
Net Asset Value, Offering and Redemption
Price Per Share -- Class I .. $15.13
=======
Net Asset Value and Redemption
Price Per Share -- Class A .. $14.94
=======
Maximum Offering Price Per Share --
Class A ($14.94 / 94.25%) $15.85
=======
- ---------------------------------------------------
* Non-income producing security
(A) Tri-Party Repurchase Agreement
Amounts designated as "--" are either $0 or have been rounded to $0.
The accompanying notes are an integral part of the financial statements.
4
<PAGE>
STATEMENT OF NET ASSETS GOLDEN OAK FAMILY OF FUNDS
July 31, 1998 Unaudited
VALUE Value
PORTFOLIO Shares (000)
- ----------------------------------------------------
COMMON STOCKS -- 96.6%
AIR TRANSPORTATION -- 2.0%
AMR* ............................ 10,000 $ 714
------
AIRCRAFT -- 2.6%
United Technologies ............. 10,000 958
------
AUTOMOTIVE -- 5.0%
Dana ............................ 12,520 623
Ford Motor ...................... 9,885 563
General Motors .................. 9,000 651
------
Total Automotive ........ 1,837
------
BANKS -- 13.7%
Chase Manhattan ................. 3,750 284
Citicorp ........................ 5,400 918
Dime Bancorp .................... 24,000 714
Fleet Financial Group ........... 7,800 670
Mellon Bank ..................... 11,320 763
NationsBank ..................... 8,300 662
Norwest ......................... 18,800 676
Peoples Heritage Financial Group 14,200 321
------
Total Banks ............. 5,008
------
BEAUTY PRODUCTS -- 1.5%
Procter & Gamble ................ 2,100 167
Johnson & Johnson ............... 4,700 363
------
Total Beauty Products ... 530
------
BUILDING & CONSTRUCTION -- 4.8%
American Standard Companies* .... 8,300 395
Lennar .......................... 10,000 276
Lone Star Industries ............ 8,300 604
Southdown ....................... 7,800 488
------
Total Building & Construction 1,763
------
CHEMICALS -- 1.1%
Millenium Chemicals ............. 14,500 391
------
COMPUTERS & SERVICES -- 10.9%
3Com* ........................... 12,000 297
Avid Technology* ................ 30,000 1,052
International Business
Machines ...................... 3,000 397
Lexmark International Group,
Class A* ...................... 13,000 865
Scitex Limited .................. 10,000 118
Sterling Software* .............. 12,500 326
Unisys* ......................... 32,600 899
------
Total Computers & Services 3,954
------
VALUE Value
PORTFOLIO (continued) Shares (000)
- ----------------------------------------------------
DRUGS -- 6.6%
Allergan ........................ 7,400 $ 387
ICN Pharmaceuticals ............. 13,800 391
Pharmacia & Upjohn .............. 16,600 786
Schering Plough ................. 8,500 822
------
Total Drugs ............. 2,386
------
ELECTRICAL UTILITIES -- 5.2%
Conectiv ........................ 26,250 538
FPL Group ....................... 10,000 608
Houston Industries .............. 12,500 349
Nipsco Industries ............... 15,720 419
------
Total Electrical Utilities 1,914
------
ELECTRICAL & ELECTRONIC PRODUCTS -- 2.7%
General Electric ................ 4,600 411
Philips Electronics ADR ......... 7,000 572
------
Total Electrical &
Electronic Products .. 983
------
ENTERTAINMENT -- 1.4%
Anchor Gaming* .................. 7,500 510
------
FINANCIAL SERVICES -- 7.6%
Bear Stearns .................... 6,500 366
Fannie Mae ...................... 11,830 733
First American Financial ........ 18,000 477
MBNA ............................ 10,482 351
Morgan Stanley, Dean Witter,
Discover ..................... 9,500 827
------
Total Financial Services 2,754
------
FOOD, BEVERAGE & TOBACCO -- 1.9%
Unilever ........................ 4,900 341
Universal ....................... 10,000 348
------
Total Food, Beverage & Tobacco 689
------
HEALTH SERVICES -- 1.2%
Columbia/HCA Healthcare ......... 15,600 445
------
INDUSTRIAL -- 2.0%
Textron ......................... 4,000 295
Tyco International Limited ...... 7,080 439
------
Total Industrial ........ 734
------
INSURANCE -- 2.5%
Sunamerica ...................... 14,700 903
------
The accompanying notes are an integral part of the financial statements.
5
<PAGE>
STATEMENT OF NET ASSETS (continued) GOLDEN OAK FAMILY OF FUNDS
July 31, 1998 Unaudited
VALUE Value
PORTFOLIO (continued) Shares (000)
- ----------------------------------------------------
MARINE TRANSPORTATION -- 1.2%
Royal Caribbean Cruises ......... 5,900 $ 438
------
MEASURING DEVICES -- 0.6%
Mettler-Toledo International* ... 10,000 211
------
OFFICE FURNITURE & FIXTURES -- 1.9%
Knoll* .......................... 20,000 707
------
PETROLEUM & FUEL PRODUCTS -- 1.3%
Apache Corp ..................... 10,000 265
Global Industries* .............. 17,500 218
------
Total Petroleum & Fuel Products 483
------
PETROLEUM REFINING -- 2.7%
Exxon ........................... 10,000 701
Mobil ........................... 4,000 279
------
Total Petroleum Refining 980
------
PROFESSIONAL SERVICES -- 1.1%
American Management Systems ..... 14,000 420
------
RETAIL -- 7.5%
Ann Taylor Stores* .............. 10,000 211
Dayton-Hudson ................... 15,000 717
Office Depot* ................... 25,000 813
Safeway* ........................ 8,800 390
TJX ............................. 25,000 588
------
Total Retail ............ 2,719
------
RUBBER & PLASTIC -- 1.1%
Rubbermaid ...................... 12,000 400
------
SEMI-CONDUCTORS/INSTRUMENTS -- 1.7%
Intel ........................... 2,500 211
LSI Logic* ...................... 20,000 414
------
Total Semi-Conductors/Instruments 625
------
TELEPHONES & TELECOMMUNICATION -- 4.8%
Aliant Communications ........... 15,000 405
Bell Atlantic ................... 10,940 496
Comverse Technology* ............ 7,000 357
U.S. West ....................... 9,560 510
------
Total Telephones &
Telecommunication .... 1,768
------
Total Common Stocks
(Cost $27,519) ....... 35,224
------
Face
VALUE Amount Value
PORTFOLIO (concluded) (000) (000)
- -----------------------------------------------------
REPURCHASE AGREEMENT -- 2.4%
Morgan Stanley (A)
5.25%, dated 07/31/98, matures
08/03/98, repurchase price
$866,845 (collateralized by
U.S. Treasury Note:
total market value $884,115) $ 863 $ 863
-------
Total Repurchase Agreement
(Cost $863) .......... 863
-------
Total Investments -- 99.0%
(Cost $28,382) ....... 36,087
-------
OTHER ASSETS AND LIABILITIES, NET-- 1.0% 360
-------
NET ASSETS:
Portfolio Shares of Class I (unlimited
authorization -- no par value)
based on 3,557,352 outstanding
shares of beneficial interest 22,464
Portfolio Shares of Class A (unlimited
authorization -- no par value)
based on 18,617 outstanding
shares of beneficial interest 196
Undistributed net investment income 26
Accumulated net realized gain
on investments .............. 6,056
Net unrealized appreciation
on investments .............. 7,705
-------
Total Net Assets -- 100.0% $36,447
=======
Net Asset Value, Offering and Redemption
Price Per Share -- Class I .. $10.19
=======
Net Asset Value and Redemption
Price Per Share -- Class A ... $10.19
=======
Maximum Offering Price Per Share --
Class A ($10.19 / 94.25%) ... $10.81
=======
- --------------------------------------------------
* Non-income producing securities
ADR -- American Depository Receipt
(A) Tri-Party Repurchase Agreement
The accompanying notes are an integral part of the financial statements.
6
<PAGE>
STATEMENT OF NET ASSETS GOLDEN OAK FAMILY OF FUNDS
July 31, 1998 Unaudited
Face
INTERMEDIATE-TERM INCOME Amount Value
PORTFOLIO (000) (000)
- ----------------------------------------------------
CORPORATE OBLIGATIONS -- 32.8%
BANKING -- 2.3%
Bank of Montreal
10.000%, 09/01/98 ........... $1,000 $ 1,002
Huntington National MTN
6.050%, 08/25/99 ............ 2,000 2,000
-------
Total Banking ........... 3,002
-------
FINANCIAL SERVICES -- 6.7%
Associates Corporation of North America
8.550%, 07/15/09 ............ 2,000 2,330
BHP Finance
8.500%, 12/01/12 ............ 3,917 4,495
Boeing Capital MTN
7.250%, 02/01/11 ............ 1,000 1,065
Chrysler Financial
13.250%, 10/15/99 ........... 1,000 1,083
-------
Total Financial Services 8,973
-------
INDUSTRIAL -- 14.2%
Cooper Industries MTN
6.375%, 05/08/08 ............ 2,000 2,007
Hertz
7.000%, 05/01/02 ............ 2,800 2,870
International Lease Finance
6.270%, 02/10/99 ............ 1,725 1,729
Philip Morris
7.000%, 07/15/05 ............ 1,500 1,536
RR Donnelley & Sons
6.700%, 07/05/05 ............ 1,000 1,036
TRW
7.370%, 04/18/07 ............ 4,500 4,826
Unocal
6.500%, 05/01/08 ............ 2,000 1,992
US Airways
6.760%, 04/15/08 ............ 939 963
WMX Technologies
7.000%, 05/15/05 ............ 2,000 2,050
-------
Total Industrial ........ 19,009
-------
RAILROADS -- 2.2%
CSX
6.400%, 06/15/09 ............ 2,000 1,981
Union Pacific,
Callable 01/15/01 @ 100
6.125%, 01/15/04 ............ 1,000 992
-------
Total Railroads ......... 2,973
-------
Face
INTERMEDIATE-TERM INCOME Amount Value
PORTFOLIO (continued) (000) (000)
- -----------------------------------------------------
TELEPHONES & TELECOMMUNICATION -- 5.2%
Cable & Wireless Communications
6.750%, 03/06/08 ............ $ 1,000 $ 1,003
GTE North
6.375%, 02/15/10 ............ 2,000 1,990
U.S. West Capital Funding
6.375%, 07/15/08 ............ 3,000 2,970
6.875%, 07/15/28 ............ 1,000 1,005
-------
Total Telephones &
Telecommunication .... 6,968
-------
WHOLESALE -- 2.2%
Supervalu MTN
6.640%, 06/09/06 ............ 3,000 2,996
-------
Total Corporate Obligations
(Cost $43,529) ....... 43,921
-------
U.S. GOVERNMENT AGENCY BONDS -- 4.9%
FHLB
5.740%, 02/25/05 ............ 3,500 3,487
FNMA MTN
6.580%, 05/14/08 ............ 3,000 3,012
-------
Total U.S. Government Agency Bonds
(Cost $6,445) ........ 6,499
-------
U.S. AGENCY MORTGAGE-BACKED OBLIGATIONS -- 5.5%
FNMA
7.040%, 08/01/15 ............ 1,409 1,520
FNMA, REMIC, Ser 1993-131, Cl B
5.750%, 06/25/06 ............ 639 638
FNMA, REMIC, Ser 1993-M1, Cl A
7.109%, 04/25/20 ............ 357 358
FNMA, Ser 1998-M2, Cl D
6.250%, 01/17/36 ............ 5,000 4,894
-------
Total U.S. Agency
Mortgage-Backed
Obligations
(Cost $7,292) ........ 7,410
-------
U.S. TREASURY OBLIGATIONS -- 42.7%
U.S. Treasury Bonds
7.500%, 11/15/16 ............ 14,500 17,245
6.250%, 08/15/23 ............ 2,000 2,117
U.S. Treasury Notes
7.750%, 02/15/01 ............ 5,375 5,655
The accompanying notes are an integral part of the financial statements.
7
<PAGE>
STATEMENT OF NET ASSETS (continued) GOLDEN OAK FAMILY OF FUNDS
July 31, 1998 Unaudited
Face
INTERMEDIATE-TERM INCOME Amount Value
PORTFOLIO (continued) (000) (000)
- ----------------------------------------------------
U.S. TREASURY OBLIGATIONS -- (CONTINUED)
6.250%, 04/30/01 ............ $ 6,000 $ 6,108
7.500%, 05/15/02 ............ 2,700 2,876
6.375%, 08/15/02 ............ 10,000 10,284
7.875%, 11/15/04 ............ 3,600 4,030
5.875%, 11/15/05 ............ 5,000 5,084
6.625%, 05/15/07 ............ 1,000 1,070
6.125%, 08/15/07 ............ 2,500 2,596
-------
Total U.S. Treasury Obligations
(Cost $55,943) ....... 57,065
-------
ASSET-BACKED SECURITIES -- 11.9%
BA Mortgage Securities, REMIC,
Ser 1998-1, Cl 2A6
6.500%, 05/28/13 ............ 2,127 2,100
Bay View Auto Trust,
Ser 1997-RA1, Cl A1,
6.290%, 12/15/01 ............ 530 531
First Union Residential
Securitization Trust,
Ser 1998-A, Cl B1
7.000%, 08/25/28 ............ 2,966 2,977
Homeside Mortgage
Securities, REMIC,
Ser 1998-2, Cl A4
7.000%, 06/25/28 ............ 2,669 2,634
PNC, Ser 1998-6, Cl A18
6.750%, 05/01/08 ............ 1,923 1,905
Residential Assistance
Securities Trust,
Ser 1998-A4, Cl A5
6.750%, 05/25/28 ............ 5,000 4,863
WFS Financial Owner Trust,
Ser 1996-B, Cl A3
6.650%, 08/20/00 ............ 911 913
-------
Total Asset-Backed Securities
(Cost $15,975) ....... 15,923
-------
REPURCHASE AGREEMENT -- 1.4%
Morgan Stanley (A)
5.57%, dated 07/31/98,
matures 08/03/98, repurchase
price $1,885,372 (collateralized
by U.S. Treasury Bill:
total market value $1,932,121) 1,884 1,884
-------
INTERMEDIATE-TERM INCOME Value
PORTFOLIO (concluded) (000)
- ----------------------------------------------------
Total Repurchase Agreement
(Cost $1,884) ........ $ 1,884
--------
Total Investments -- 99.2%
(Cost $131,069) ...... 132,702
--------
OTHER ASSETS AND LIABILITIES, NET -- 0.8% 1,110
--------
NET ASSETS:
Portfolio Shares of Class I (unlimited
authorization -- no par value)
based on 13,298,864 outstanding
shares of beneficial interest ....... 132,109
Portfolio Shares of Class A (unlimited
authorization -- no par value)
based on 39,621 outstanding
shares of beneficial interest ....... 408
Undistributed net investment income ..... 23
Accumulated net realized loss on investments (361)
Net unrealized appreciation on investments 1,633
--------
Total Net Assets-- 100.0% $133,812
========
Net Asset Value, Offering and Redemption
Price Per Share -- Class I $10.03
========
Net Asset Value and Redemption
Price Per Share -- Class A $10.03
========
Maximum Offering Price Per Share --
Class A ($10.03 / 95.5%) $10.50
========
- --------------------------------------------------------------------------------
Cl -- Class
FHLB -- Federal Home Loan Bank
FNMA -- Federal National Mortgage Association
MTN -- Medium Term Note
REMIC -- Real Estate Mortgage Investment Conduit
Ser -- Series
(A) Tri-Party Repurchase Agreement
The accompanying notes are an integral part of the financial statements.
8
<PAGE>
STATEMENT OF NET ASSETS GOLDEN OAK FAMILY OF FUNDS
July 31, 1998 Unaudited
Face
MICHIGAN TAX FREE BOND Amount Value
PORTFOLIO (000) (000)
- --------------------------------------------------------------------------------
MUNICIPAL BONDS -- 98.2%
MICHIGAN -- 98.2%
Alpena County, GO, AMBAC
5.450%, 06/01/01 ......... $ 250 $ 259
Anchor Bay, School
District, GO, MBIA
6.000%, 05/01/03 ......... 870 935
Ann Arbor, Water Supply
System, RB, MBIA
7.375%, 02/01/02 ......... 1,000 1,101
Auburn Hills, Finance
Authority, Tax Allocation,
RB, Series A (A)
7.000%, 05/01/00 ......... 300 305
Avondale, School District, GO
6.600%, 05/01/05 ......... 200 214
6.700%, 05/01/06 ......... 200 214
Big Rapids, Public School
District, GO, FGIC
7.300%, 05/01/05 ......... 250 292
Calhoun County, GO, AMBAC
4.950%, 07/01/03 ......... 1,000 1,031
Central Michigan State
University, RB, FGIC
5.200%, 10/01/09 ......... 860 900
Cheboygan, School District,
GO, MBIA
6.000%, 05/01/02 ......... 260 276
Chippewa Valley, School
District, GO,
Pre-refunded
@ 101.50, FGIC (B)
6.200%, 05/01/01 ......... 250 268
Clarkston, Community
Schools, GO, FGIC,
Pre-refunded @ 101
5.800%, 05/01/05 ......... 1,000 1,097
Clinton County, Building
Authority, GO,
Macomb County
Project, Series A,
Pre-refunded @ 102,
AMBAC (B)
6.400%, 11/01/01 ......... 250 272
De Witt, Public Schools,
GO, AMBAC
6.000%, 05/01/03 ......... 935 1,005
De Witt, Public Schools, GO,
Pre-refunded @ 101.5 (B)
6.600%, 05/01/01 ......... 300 324
Dearborn, Municipal
Building Authority,
GO, AMBAC
7.000%, 06/01/01 ......... 300 322
7.000%, 06/01/02 ......... 475 521
7.000%, 06/01/03 ......... 505 564
Face
MICHIGAN TAX FREE BOND Amount Value
PORTFOLIO (continued) (000) (000)
- --------------------------------------------------------------------------------
Detroit, Distributable
State Aid, GO, AMBAC
5.000%, 05/01/05 ......... $ 200 $ 207
Detroit, GO, Pre-refunded @ 102 (B)
8.000%, 04/01/01 ......... 1,000 1,119
Detroit, GO, Refunding
Bond, AMBAC
5.250%, 05/01/08 ......... 1,000 1,054
Detroit, School District, GO
6.250%, 05/01/12 ......... 850 904
Detroit, Sewer Disposal, RB,
Pre-refunded @ 101.5 (B)
7.250%, 07/01/99 ......... 200 209
Detroit, Water Supply
System, RB, FGIC
6.250%, 07/01/07 ......... 500 533
Detroit, Water Suppl
System, Second Lien,
RB, Series A, MBIA
5.100%, 07/01/07 ......... 500 519
East Lansing, Refunding
Bond, GO, Series B
4.850%, 10/01/07 ......... 315 317
Ferris State University,
RB, AMBAC,
Pre-refunded @ 101
5.400%, 04/01/07 ......... 675 728
Flat Rock, Community
School District,
GO, MBIA
7.750%, 05/01/04 ......... 675 791
Flint, Refunding Bond,
GO, MBIA
6.000%, 11/01/03 ......... 1,040 1,124
Fraser, Public School
District, GO, AMBAC
6.550%, 05/01/99 ......... 100 102
Grand Rapids, Building
Authority, RB
5.375%, 04/01/07 ......... 200 211
Grand Rapids, Downtown
Development Authority,
RB, MBIA
6.600%, 06/01/08 ......... 200 225
Grand Rapids, Water
Supply, RB, FGIC,
Escrowed to Maturity
6.400%, 01/01/05 ......... 1,000 1,064
Grand Valley, Michigan
State University,
RB, MBIA
4.300%, 10/01/01 ......... 500 503
Grandville, Public
School District, GO
4.000%, 05/01/99 ......... 345 346
The accompanying notes are an integral part of the financial statements.
9
<PAGE>
STATEMENT OF NET ASSETS (continued) GOLDEN OAK FAMILY OF FUNDS
July 31, 1998 Unaudited
Face
MICHIGAN TAX FREE BOND Amount Value
PORTFOLIO (continued) (000) (000)
- --------------------------------------------------------------------------------
MICHIGAN -- (CONTINUED)
Haslett, Public School
District, GO, MBIA
6.000%, 05/01/02 ......... $ 310 $ 329
6.000%, 05/01/03 ......... 310 333
Howell, Public Schools,
GO, FGIC
5.000%, 05/01/08 ......... 1,000 1,031
Ingham County, Proctor
Drain System
Project, GO
7.100%, 02/01/01 ......... 180 186
Iron Mountain, Finance
Authority, GO, AMBAC
5.000%, 05/01/05 ......... 250 258
Johannesburg-Lewiston,
Area Schools,
GO, AMBAC
6.750%, 05/01/02 ......... 280 304
6.750%, 05/01/03 ......... 320 354
6.000%, 05/01/04 ......... 365 396
Kalamazoo, City School
District, GO, FGIC
4.550%, 05/01/01 ......... 1,000 1,011
Kalamazoo, Hospital
Finance Authority,
Borgess Medical
Center, Series A,
RB, AMBAC
5.000%, 06/01/04 ......... 1,000 1,029
Kalamazoo, Water Supply
System Project, RB
6.000%, 09/01/07 ......... 425 455
Kent, Hospital Authority,
RB, Mary Free Bed
Project, Series A
6.250%, 04/01/03 ......... 250 263
Kent County, Building
Authority, GO
5.000%, 12/01/06 ......... 500 522
5.100%, 12/01/07 ......... 500 524
Kentwood, Public School
System, GO
5.900%, 05/01/04 ......... 380 407
Kentwood, Public School
System, GO,
Pre-refunded @ 102 (B)
5.900%, 05/01/02 ......... 370 399
Lansing, Building Authority, GO,
Escrowed to Maturity
7.100%, 06/01/02 ......... 100 110
Lansing, Finance Authority, GO
6.100%, 10/01/03 ......... 250 272
Lincoln, School District, GO, FGIC,
Escrowed to Maturity
5.750%, 05/01/09 ......... 900 964
Face
MICHIGAN TAX FREE BOND Amount Value
PORTFOLIO (continued) (000) (000)
- --------------------------------------------------------------------------------
Livonia, Municipal
Building Authority, RB
5.750%, 06/01/04 ......... $ 250 $ 267
Livonia, Public School
District, GO
5.450%, 05/01/01 ......... 200 207
Livonia, Water Supply
& Wastewater System,
RB, AMBAC
5.200%, 11/01/09 ......... 1,000 1,021
Macomb County, Community
College, GO
4.625%, 05/01/99 ......... 835 841
Montague, Public School
District, GO, FSA
5.125%, 05/01/06 ......... 300 314
5.125%, 05/01/08 ......... 300 312
Northville, Public
Schools, GO, FGIC
5.000%, 05/01/10 ......... 500 510
Oak Park, GO, ABMAC
5.200%, 05/01/06 ......... 250 261
Oakland County, Acacia
Park Drain District,
GO, MBIA
8.000%, 10/01/99 ......... 125 131
8.000%, 10/01/00 ......... 110 119
Oakland County, Birmingham
Drain District,
GO, Series C
7.500%, 10/01/99 ......... 230 239
7.500%, 10/01/00 ......... 325 348
7.500%, 10/01/01 ......... 325 357
Oakland County, Bloomfield
Drain District,
GO, Series C
8.000%, 10/01/98 ......... 200 201
7.500%, 10/01/99 ......... 200 208
7.500%, 10/01/00 ......... 300 321
7.500%, 10/01/01 ......... 275 302
Oakland County, Caddell
Drain District, GO
6.300%, 11/01/99 ......... 100 102
Oakland County,
Economic Development
Authority, Cranbrook
Elderly Community
Project, RB
6.375%, 11/01/14 ......... 1,000 1,112
Okemos, Public School
District, Series I, GO
6.300%, 05/01/00 ......... 750 779
Pewamo, Westphalia
School District,
GO, FGIC
5.000%, 05/01/06 ......... 275 285
The accompanying notes are an integral part of the financial statements.
10
<PAGE>
STATEMENT OF NET ASSETS (continued) GOLDEN OAK FAMILY OF FUNDS
July 31, 1998 Unaudited
Face
MICHIGAN TAX FREE BOND Amount Value
PORTFOLIO (continued) (000) (000)
- --------------------------------------------------------------------------------
MICHIGAN -- (CONTINUED)
Plymouth-Canton,
Community School
District, GO, Series B
6.250%, 05/01/02 ......... $1,400 $1,487
6.350%, 05/01/03 ......... 300 319
Plymouth-Canton,
Community School
District, GO, Series C
5.900%, 05/01/02 ......... 250 265
6.200%, 05/01/05 ......... 250 271
Pontiac, Building
Authority, GO, AMBAC
6.400%, 04/01/00 ......... 110 114
Pontiac, Building
Authority, GO, AMBAC,
Pre-refunded @ 101 (B)
6.875%, 04/01/01 ......... 200 217
Redford Township, GO, AMBAC
6.750%, 04/01/06 ......... 200 219
Riverview, Community
School District, GO,
Pre-refunded @ 101.50,
FGIC (B)
6.400%, 05/01/02 ......... 250 273
Rochester, Community
School District,
GO, MBIA
5.500%, 05/01/06 ......... 1,000 1,070
Rochester Hills, GO,
Refunding Bond
5.500%, 11/01/06 ......... 250 261
5.500%, 11/01/07 ......... 250 262
Romeo, Community
School District, GO,
Pre-refunded @ 101 (B)
6.900%, 05/01/00 ......... 100 106
Royal Oak, City
School District, GO,
Pre-refunded @ 101.50 (B)
6.500%, 05/01/01 ......... 230 248
Royal Oak, Hospital
Finance Authority, RB,
Pre-refunded @ 100 (B)
7.750%, 01/01/00 ......... 120 126
Saline, Building Authority,
GO, AMBAC
7.000%, 07/01/05 ......... 100 109
South Lyon, School District, GO
6.100%, 05/01/00 ......... 100 104
6.500%, 05/01/05 ......... 350 377
State, Building Authority,
Ferris State
University, Series 1, GO,
Pre-refunded @ 101.50 (B)
6.750%, 10/01/00 ......... 250 268
Face
MICHIGAN TAX FREE BOND Amount Value
PORTFOLIO (continued) (000) (000)
- --------------------------------------------------------------------------------
State, Building Authority,
RB, AMBAC
6.750%, 10/01/07 ......... $ 245 $ 266
State, Building Authority,
Series B, RB
5.000%, 04/01/01 ......... 500 512
State, Building Authority,
Series I, RB
6.400%, 10/01/04 ......... 650 702
6.500%, 10/01/05 ......... 500 542
State, Building Authority,
Series I, RB, AMBAC
6.000%, 10/01/02 ......... 300 321
5.500%, 10/01/07 ......... 1,000 1,073
State, Building Authority,
Series II, RB
5.900%, 10/01/99 ......... 100 103
6.000%, 10/01/00 ......... 100 104
6.500%, 10/01/05 ......... 120 130
State, Building Authority,
Series II, RB, AMBAC
6.250%, 10/01/04 ......... 300 322
State, Building Authority,
Series II, RB, FSA
6.200%, 10/01/02 ......... 250 269
State, Financial Assurance Authority,
Underground Storage Tank,
Series I, RB, AMBAC
5.000%, 05/01/01 ......... 1,000 1,023
State, Higher Education
Facilities Authority,
Thomas M. Cooley
College Project, RB (A)
4.500%, 05/01/04 ......... 750 750
State, Hospital Authority,
Detroit Medical
Center, Series A, RB
6.900%, 08/15/99 ......... 160 164
7.100%, 08/15/01 ......... 165 178
State, Hospital Authority,
Henry Ford Health
Center, Series A, RB
5.100%, 11/15/07 ......... 600 623
State, Hospital Authority, Oakwood
Hospital Group, RB, FGIC,
Pre-refunded @ 102 (B)
7.000%, 07/01/00 ......... 500 538
State, Hospital Finance
Authority, Botsford
Group, Series A, RB, MBIA
4.400%, 02/15/04 ......... 1,000 999
State, Hospital Finance
Authority, Detroit
Medical Center Project, RB
6.250%, 08/15/13 ......... 675 724
The accompanying notes are an integral part of the financial statements.
11
<PAGE>
STATEMENT OF NET ASSETS (continued) GOLDEN OAK FAMILY OF FUNDS
July 31, 1998 Unaudited
Face
MICHIGAN TAX FREE BOND Amount Value
PORTFOLIO (continued) (000) (000)
- --------------------------------------------------------------------------------
MICHIGAN -- (CONTINUED)
State, Hospital Finance
Authority, Detroit
Medical Group, Series A,
RB, AMBAC
5.000%, 08/15/05 ......... $ 2,180 $2,248
State, Hospital Finance
Authority, Mclaren
Group, Series A, RB
5.000%, 10/15/04 ......... 1,000 1,030
5.200%, 10/15/06 ......... 750 776
State, Hospital Finance
Authority, Mclaren
Group, Series A, RB,
Escrowed to Maturity
7.200%, 09/15/00 ......... 200 214
State, Hospital Finance
Authority, Mid Michigan
Group, Series A, RB, FSA
5.500%, 06/01/08 ......... 1,400 1,493
State, Hospital Finance
Authority, Sisters of
Mercy Project, RB, MBIA
4.900%, 08/15/05 ......... 1,000 1,026
State, Hospital Finance
Authority, Sparrow
Group, RB, MBIA
5.200%, 11/15/07 ......... 480 501
5.300%, 11/15/08 ......... 450 474
5.400%, 11/15/09 ......... 450 475
State, Hospital Finance
Authority, St. John
Hospital, Series A, RB, AMBAC
5.650%, 05/15/03 ......... 300 317
State, Hospital Finance
Authority, St. John
Hospital & Medical
Center, RB, AMBAC
5.000%, 05/15/04 ......... 750 772
State, Housing Development
Authority, Greenwood
Villa Project, RB, FSA
6.500%, 09/15/07 ......... 160 173
State, Municipal Bond Authority,
Revolving Fund, RB
5.500%, 10/01/06 ......... 810 867
5.150%, 10/01/08 ......... 1,000 1,038
State, Municipal Bond Authority,
Revolving Fund, Series A, RB
6.000%, 10/01/02 ......... 1,000 1,071
State, Municipal Bond Authority,
Series A, RB
6.500%, 05/01/07 ......... 250 273
State, Power Supply System, RB, MBIA
5.800%, 11/01/05 ......... 400 435
Face
MICHIGAN TAX FREE BOND Amount Value
PORTFOLIO (continued) (000) (000)
- --------------------------------------------------------------------------------
State, Public Power Agency,
Belle River
Project, Series A, RB
5.400%, 01/01/01 ......... $ 250 $ 258
5.200%, 01/01/04 ......... 300 312
State, Public Power
Agency, Campbell
Project, Series A, RB, AMBAC
5.000%, 01/01/03 ......... 500 516
5.500%, 01/01/06 ......... 500 532
State, Roseville School
District, GO, FSA
4.450%, 05/01/06 ......... 1,500 1,504
State, Sisters Mercy
Health System, RB, FSA
5.700%, 02/15/01 ......... 250 259
State, Strategic Fund,
Ford Motor Project,
Series A, RB
7.100%, 02/01/06 ......... 350 408
State, Strategic Fund,
NSF Internal Project,
Series A, RB (A)
5.400%, 08/01/10 ......... 1,105 1,144
5.500%, 08/01/11 ......... 1,065 1,104
State, Trunk Line, Series A, RB
5.625%, 10/01/03 ......... 500 533
State, Trunk Line, Series B-2, RB
5.750%, 10/01/04 ......... 350 377
State, University, Series A, RB,
Pre-refunded @ 101 (B)
6.125%, 08/15/02 ......... 1,250 1,353
State, Washtenaw
County Community
College, Series A, GO
4.350%, 04/01/05 ......... 1,375 1,375
Traverse City, Area
Public Schools,
Series I, GO, MBIA
7.250%, 05/01/05 ......... 950 1,106
Traverse City, Area
Public Schools,
Series I, GO,
Pre-refunded @ 102 (B)
7.000%, 05/01/01 ......... 100 109
Traverse City, Area
Public Schools,
Series II, GO,
Pre-refunded @ 101.50 (B)
7.000%, 05/01/01 ......... 200 218
Troy, City School District, GO
4.750%, 05/01/08 ......... 1,000 1,013
Troy, City School District, GO,
Pre-refunded @ 101.5 (B)
6.000%, 05/01/01 ......... 250 266
The accompanying notes are an integral part of the financial statements.
12
<PAGE>
STATEMENT OF NET ASSETS (continued) GOLDEN OAK FAMILY OF FUNDS
July 31, 1998 Unaudited
Face
MICHIGAN TAX FREE BOND Amount Value
PORTFOLIO (continued) (000) (000)
- --------------------------------------------------------------------------------
MICHIGAN -- (CONTINUED)
University of Michigan,
Hospital Revenue,
Series A, RB
5.800%, 12/01/05 ......... $ 400 $ 428
University of Michigan,
Major Capital
Projects, Series B, RB
5.300%, 04/01/05 ......... 250 265
Utica, Community Schools, GO
5.375%, 05/01/02 ......... 200 209
5.750%, 05/01/07 ......... 500 536
Walled Lake, School
District, GO, MBIA
5.500%, 05/01/02 ......... 500 523
Walled Lake, School
District, Series II,
GO, Pre-refunded @ 102 (B)
7.100%, 05/01/00 ......... 100 107
Warren, Building
Authority, RB,
Pre-refunded @ 102, FSA (B)
8.750%, 11/01/00 ......... 100 112
Warren Woods, Public
School System,
Pre-refunded @ 100.50 (B)
7.200%, 06/01/00 ......... 100 106
Washtenaw, Community College,
Series A, GO
4.900%, 04/01/06 ......... 1,200 1,230
Waterford Township,
School District, GO
4.850%, 06/01/10 ......... 1,450 1,461
Wayne County, Airport
Authority, Detroit
Metro Airport Project,
Series A, RB, MBIA
6.400%, 12/01/01 ......... 200 214
Wayne County, Building
Authority, Capital
Improvements, Series A,
GO, MBIA
5.625%, 06/01/04 ......... 1,000 1,068
Western Townships,
Utility Authority, GO,
FSA, Escrowed to Maturity
5.900%, 01/01/99 ......... 160 161
Face
MICHIGAN TAX FREE BOND Amount Value
PORTFOLIO (continued) (000) (000)
- --------------------------------------------------------------------------------
Wixon County, Public
Improvements, GO, AMBAC
4.750%, 05/01/11 ......... $1,000 $ 994
Wyandotte, Building Authority, RB,
Escrowed to Maturity
7.000%, 01/01/03 ......... 100 111
Wyandotte, Electric
Authority, RB, MBIA
6.250%, 10/01/08 ......... 1,700 1,910
Wyandotte, Finance Authority,
Tax Allocation, RB, MBIA
6.100%, 06/01/02 ......... 500 533
-------
Total Michigan ....... 88,217
-------
Total Municipal Bonds
(Cost $85,211) .... 88,217
-------
CASH EQUIVALENT -- 0.8%
SEI Institutional Tax Free Portfolio 687 687
-------
Total Cash Equivalent
(Cost $687) ....... 687
-------
Total Investments -- 98.9%
(Cost $85,898) .... 88,904
-------
OTHER ASSETS AND LIABILITIES, NET -- 1.1% 954
-------
The accompanying notes are an integral part of the financial statements.
13
<PAGE>
STATEMENT OF NET ASSETS (continued) GOLDEN OAK FAMILY OF FUNDS
July 31, 1998 Unaudited
MICHIGAN TAX FREE BOND Value
PORTFOLIO (concluded) (000)
- --------------------------------------------------------------------------------
NET ASSETS:
Portfolio Shares of Class I (unlimited
authorization -- no par value)
based on 8,846,345 outstanding
shares of beneficial interest ..... $86,753
Portfolio Shares of Class A (unlimited
authorization -- no par value)
based on 7,570 outstanding
shares of beneficial interest 76
Accumulated net realized gain ........ 23
Net unrealized appreciation on investments 3,006
-------
Total Net Assets -- 100.0% ........... $89,858
=======
Net Asset Value, Offering and Redemption
Price Per Share -- Class I ....... $10.15
=======
Net Asset Value and Redemption
Price Per Share -- Class A ....... $10.15
=======
Maximum Offering Price Per Share --
Class A ($10.15 / 95.5%) ......... $10.63
=======
- --------------------------------------------------------------------------------
AMBAC -- American Municipal Bond Assurance Corporation
FGIC -- Financial Guaranty Insurance Company
FSA -- Financial Security Assurance
GO -- General Obligation
MBIA -- Municipal Bond Insurance Association
RB -- Revenue Bond
(A) Security is held in connection with a letter of credit or standby bond
purchase agreement issued by a major commercial bank or other financial
institution.
(B) Pre-refunded Security. The pre-refunded date is shown as the
maturity date on the Statement of Net Assets.
The accompanying notes are an integral part of the financial statements.
14
<PAGE>
STATEMENT OF NET ASSETS GOLDEN OAK FAMILY OF FUNDS
July 31, 1998 Unaudited
Face
PRIME OBLIGATION MONEY Amount Value
MARKET PORTFOLIO (000) (000)
- --------------------------------------------------------------------------------
COMMERCIAL PAPER -- 60.1%
AEROSPACE & DEFENSE -- 0.8%
Lockheed Martin
5.690%, 08/14/98 ......... $1,000 $ 998
------
FINANCIAL SERVICES -- 56.5%
Aesop Funding
5.550%, 08/14/98 ......... 4,600 4,591
Apreco
5.560%, 08/17/98 ......... 3,500 3,491
Corporate Receivable
5.540%, 08/27/98 ......... 2,150 2,141
Countrywide Home Loans
5.570%, 08/05/98 ......... 4,687 4,684
Delaware Funding
5.550%, 08/07/98 ......... 3,011 3,008
Enterprise Funding
5.540%, 08/17/98 ......... 4,200 4,190
Eureka Securities
5.530%, 08/31/98 ......... 3,500 3,484
Falcon Asset Securitization
5.600%, 09/10/98 ......... 2,000 1,988
General Motors Acceptance
5.540%, 11/12/98 ......... 1,000 984
5.540%, 11/16/98 ......... 3,100 3,049
Goldman Sachs Group LP
5.540%, 08/26/98 ......... 4,200 4,184
Greenwich Funding
5.540%, 08/10/98 ......... 4,575 4,569
Greyhawk Funding
5.540%, 09/22/98 ......... 4,000 3,968
GTE Funding
5.550%, 08/12/98 ......... 4,200 4,193
Island Finance
5.570%, 08/04/98 ......... 1,100 1,099
Kitty Hawk Funding
5.600%, 08/26/98 ......... 4,017 4,001
Merrill Lynch & Company
5.560%, 09/11/98 ......... 4,000 3,975
Mont Blanc Capital
5.560%, 08/17/98 ......... 2,000 1,995
Park Avenue Receivable
5.560%, 08/12/98 ......... 3,000 2,995
Peacock Funding
5.520%, 11/09/98 ......... 4,200 4,136
Face
PRIME OBLIGATION MONEY Amount Value
MARKET PORTFOLIO(continued) (000) (000)
- --------------------------------------------------------------------------------
Prefco
5.570%, 08/13/98 ......... $4,200 $ 4,192
Quebec Province
5.520%, 12/22/98 ......... 500 489
Rose Funding
5.560%, 09/14/98 ......... 1,570 1,559
-------
Total Financial Services 72,965
-------
RETAIL -- 2.8%
Wal-Mart Stores
5.680%, 08/03/98 ......... 3,650 3,649
-------
Total Commercial Paper
(Cost $77,612) .... 77,612
-------
U.S. GOVERNMENT AGENCY OBLIGATION -- 7.0%
FNMA (A)
5.233%, 08/11/98 ......... 9,000 9,000
-------
Total U.S. Government Agency Obligation
(Cost $9,000) ..... 9,000
-------
FLOATING RATE INSTRUMENTS -- 4.6%
People's Security Life (A)
5.820%, 08/01/98 ......... 3,000 3,000
Travelers Insurance (A)
5.738%, 09/01/98 ......... 3,000 3,000
-------
Total Floating Rate Instruments
(Cost $6,000) ..... 6,000
-------
CERTIFICATES OF DEPOSIT -- 15.1%
Bank Nova Scotia
5.830%, 10/02/98 ......... 3,000 2,999
Canadian Imperial Bank
5.550%, 02/10/99 ......... 3,000 2,998
Rabobank Nederland
5.750%, 04/27/99 ......... 4,000 3,998
Societe Generale
5.795%, 04/27/99 ......... 3,500 3,499
Svenska Handels
5.740%, 06/01/99 ......... 2,000 1,999
The accompanying notes are an integral part of the financial statements.
15
<PAGE>
STATEMENT OF NET ASSETS (continued) GOLDEN OAK FAMILY OF FUNDS
July 31, 1998 Unaudited
Face
PRIME OBLIGATION MONEY Amount Value
MARKET PORTFOLIO (continued) (000) (000)
- --------------------------------------------------------------------------------
CERTIFICATES OF DEPOSIT -- (CONTINUED)
Unibank
5.950%, 12/01/98 ......... $4,000 $ 4,002
-------
Total Certificates of Deposit
(Cost $19,495) .... 19,495
-------
CORPORATE BOND -- 3.5%
Abbey National Treasury Service
5.875%, 12/22/98 ......... 4,500 4,502
-------
Total Corporate Bond
(Cost $4,502) ..... 4,502
-------
BANK NOTES -- 9.6%
American Express Centurion Bank (A)
5.596%, 08/26/98 ......... 4,200 4,200
Comerica Bank (A)
5.536%, 08/13/98 ......... 4,000 3,998
PNC Bank (A)
5.472%, 08/03/98 ......... 4,200 4,197
-------
Total Bank Notes
(Cost $12,395) .... 12,395
-------
Total Investments -- 99.8%
(Cost $129,004) ... 129,004
-------
OTHER ASSETS AND LIABILITIES, NET -- 0.2% 197
-------
PRIME OBLIGATION MONEY Value
MARKET PORTFOLIO (concluded) (000)
- --------------------------------------------------------------------------------
NET ASSETS:
Portfolio Shares of Class I (unlimited
authorization -- no par value)
based on 123,304,509 outstanding
shares of beneficial interest ...... $123,305
Portfolio Shares of Class A (unlimited
authorization -- no par value)
based on 5,909,806 outstanding
shares of beneficial interest ...... 5,910
Accumulated net realized loss on
investments ........................ (14)
--------
Total Net Assets -- 100.0% ............. $129,201
========
Net Asset Value, Offering and Redemption
Price Per Share -- Class I ......... $1.00
========
Net Asset Value and Redemption
Price Per Share -- Class A ......... $1.00
========
- --------------------------------------------------------------------------------
FNMA -- Federal National Mortgage Association
LP -- Limited Partnership
(A) Adjustable Rate Security. The rate reported on the Statement of Net Assets
is the rate in effect on July 31, 1998. The date shown is the next scheduled
reset date.
The accompanying notes are an integral part of the financial statements.
16
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS (000) GOLDEN OAK FAMILY OF FUNDS
For the Six Months Ended July 31, 1998 Unaudited
INTERMEDIATE-TERM MICHIGAN PRIME OBLIGATION
GROWTH VALUE INCOME TAX FREE BOND MONEY MARKET
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Investment Income:
Dividend Income .................. $ 206 $ 247 $ -- $ -- $ --
Interest Income .................. 60 24 4,017 2,190 3,872
- ---------------------------------------------------------------------------------------------------------------------------
Total Investment Income ........ 266 271 4,017 2,190 3,872
- ---------------------------------------------------------------------------------------------------------------------------
Expenses:
Investment Advisory Fees ......... 70 54 324 218 153
Less: Waiver of Investment
Advisory Fees .................. -- -- (92) (68) (131)
Investment Sub-Advisory Fees ..... 82 81 -- -- 51
Administration Fees .............. 41 36 129 87 136
Transfer Agent Fees .............. 14 14 19 17 20
Custodian Fees ................... 2 2 7 5 7
Professional Fees ................ 4 3 13 9 13
Registration Fees ................ 1 1 5 3 5
Distribution Fees(1) ............. -- -- -- -- 8
Amortization of Deferred
Organizational Costs ........... -- 2 -- 2 --
Trustee Fees ..................... 1 1 4 3 5
Printing Expenses ................ 3 2 9 6 10
Other Expenses ................... 2 1 3 2 3
- ---------------------------------------------------------------------------------------------------------------------------
Total Expenses, Net of Waivers . 220 197 421 284 280
- ---------------------------------------------------------------------------------------------------------------------------
Net Investment Income ............ 46 74 3,596 1,906 3,592
- ---------------------------------------------------------------------------------------------------------------------------
Net Realized Gain (Loss)
on Securities Sold ............. 3,242 3,819 624 20 (5)
Net Change in Unrealized
Appreciation (Depreciation)
on Investments ................. 3,933 (878) (726) (741) --
Net Realized and Unrealized
Gain on Investments ............ 7,175 2,941 (102) (721) (5)
Increase in Net Assets Resulting
From Operations ................ $7,221 $3,015 $3,494 $1,185 $3,587
============================================================================================================================
Amounts designated as "--" are either $0 or have been rounded to $0.
<FN>
(1) All distribution fees are incurred in the Class A Shares.
</FN>
</TABLE>
The accompanying notes are an integral part of the financial statements.
17
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS (000)
<TABLE>
<CAPTION>
For the Period Ended July 31, 1998 (Unaudited) and the Period Ended January 31, 1998
GROWTH VALUE
PORTFOLIO PORTFOLIO(1)
-------------------------- -----------------------
2/1/98 TO 2/1/97 TO 2/1/98 TO 6/23/97 TO
7/31/98 1/31/98 7/31/98 1/31/98
- ---------------------------------------------------------------------------------------------------------------------------
Investment Operations:
<S> <C> <C> <C> <C>
Net Investment Income $ 46 $ 9 $ 74 $ 124
Net Realized Gain (Loss) on Securities Sold 3,242 9,392 3,819 6,415
Net Change in Unrealized Appreciation
(Depreciation) on Investments ............. 3,933 (664) (878) (4,133)
- ----------------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets Resulting
from Investment Operations ................ 7,221 8,737 3,015 2,406
- ----------------------------------------------------------------------------------------------------------------------------
Distributions:
Net Investment Income
Class I ................................... (27) -- (72) (100)
Class A ................................... -- -- -- --
Realized Net Gain
Class I ................................... -- (7,682) -- (4,168)
Class A ................................... -- (63) -- (10)
- ----------------------------------------------------------------------------------------------------------------------------
Total Distributions ........................... (27) (7,745) (72) (4,278)
- ----------------------------------------------------------------------------------------------------------------------------
Capital Share Transactions:
Class I: ......................................
Proceeds from Shares Issued 6,670 10,958 5,914 10,911
Value from Shares Issued in Connection
with Acquisition of Common Trust Fund Assets
(See note 8) ............................... -- -- -- 26,599
--
Reinvestment of Cash Distributions -- 2 -- 8
Cost of Shares Redeemed ..................... (7,003) (8,688) (3,519) (4,733)
- ---------------------------------------------------------------------------------------------------------------------------
Total Class I Share Transactions .............. (333) 2,272 2,395 32,785
- ---------------------------------------------------------------------------------------------------------------------------
Class A:
Proceeds from Shares Issued ................. 123 43 136 53
Reinvestment of Cash Distributions .......... -- 63 -- 7
Cost of Shares Redeemed ..................... (33) (22) -- --
- ----------------------------------------------------------------------------------------------------------------------------
Total Class A Share Transactions .............. 90 84 136 60
- ----------------------------------------------------------------------------------------------------------------------------
Increase (Decrease) in Net Assets From
Capital Share Transactions .................. (243) 2,356 2,531 32,845
- ----------------------------------------------------------------------------------------------------------------------------
Total Increase (Decrease) in Net Assets ...... 6,951 3,348 5,474 30,973
- ----------------------------------------------------------------------------------------------------------------------------
Net Assets:
Beginning of Period ........................ 36,547 33,199 30,973 --
- ----------------------------------------------------------------------------------------------------------------------------
End of Period .............................. $43,498 $36,547 $36,447 $30,973
============================================================================================================================
Shares Issued and Redeemed
Class I:
Shares Issued .............................. 451 857 579 1,109
Shares Issued in Connection with Acquisition
of Common Trust Fund Assets (See note 8) . -- -- -- 2,660
Shares Issued in Lieu of Cash Distributions -- -- -- 1
Shares Redeemed ............................ (468) (600) (337) (455)
- ----------------------------------------------------------------------------------------------------------------------------
Total Class I Share Transactions ............. (17) 257 242 3,315
- ----------------------------------------------------------------------------------------------------------------------------
Class A
Shares Issued .............................. 8 3 13 5
Shares Issued in Lieu of Cash Distributions -- 6 -- 1
Shares Redeemed ............................ (2) (2) -- --
- ----------------------------------------------------------------------------------------------------------------------------
Total Class A Share Transactions ............. 6 7 13 6
- ----------------------------------------------------------------------------------------------------------------------------
Increase (Decrease) in Capital Shares ........ (11) 264 255 3,321
============================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
INTERMEDIATE-TERM MICHIGAN PRIME OBLIGATION
INCOME TAX FREE BOND MONEY MARKET
PORTFOLIO PORTFOLIO(1) PORTFOLIO
---------------------- ----------------------- ---------------------
2/1/98 TO 2/1/97 TO 2/1/98 TO 6/23/97 TO 2/1/98 TO 2/1/97 TO
7/31/98 1/31/98 7/31/98 1/31/98 7/31/98 1/31/98
- ---------------------------------------------------------------------------------------------------------------------
Investment Operations:
<S> <C> <C> <C> <C> <C> <C>
Net Investment Income ............ $ 3,596 $ 6,948 $ 1,906 $ 2,223 $ 3,592 $ 7,183
Net Realized Gain (Loss)
on Securities Sold ............. 624 (406) 20 137 (5) 8
Net Change in Unrealized
Appreciation (Depreciation)
on Investments ................. (726) 3,080 (741) 1,943 -- --
- ---------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets
Resulting from Investment
Operations ..................... 3,494 9,622 1,185 4,303 3,587 7,191
- ---------------------------------------------------------------------------------------------------------------------
Distributions:
Net Investment Income
Class I ........................ (3,592) (6,945) (1,905) (2,222) (3,429) (5,163)
Class A ........................ (4) (4) (1) (1) (163) (2,020)
Realized Net Gains
Class I ........................ -- -- -- (134) -- --
Class A ........................ -- -- -- -- -- --
- ---------------------------------------------------------------------------------------------------------------------
Total Distributions ................ (3,596) (6,949) (1,906) (2,357) (3,592) (7,183)
- ---------------------------------------------------------------------------------------------------------------------
Capital Share Transactions:
Class I:
Proceeds from Shares Issued ...... 16,267 31,561 15,691 13,619 86,456 220,104
Value from Shares Issued in
Connection with Acquisition of
Common Trust Fund Assets (See note 8) -- -- -- 77,580 -- --
Reinvestment of Cash Distributions 2 1 -- -- 1 4
Cost of Shares Redeemed .......... (8,688) (24,986) (10,746) (7,587) (91,137) (186,643)
- ---------------------------------------------------------------------------------------------------------------------
Total Class I Share Transactions ... 7,581 6,576 4,945 83,612 (4,680) 33,465
- ---------------------------------------------------------------------------------------------------------------------
Class A:
Proceeds from Shares Issued ...... 333 2 123 8 6,327 214,687
Reinvestment of Cash Distributions 3 3 1 -- 137 274
Cost of Shares Redeemed .......... (3) (27) (56) -- (6,936) (280,270)
- ---------------------------------------------------------------------------------------------------------------------
Total Class A Share Transactions ... 333 (22) 68 8 (472) (65,309)
- ---------------------------------------------------------------------------------------------------------------------
Increase (Decrease) in Net Assets
From Capital Share Transactions 7,914 6,554 5,013 83,620 (5,152) (31,844)
- ---------------------------------------------------------------------------------------------------------------------
Total Increase (Decrease) in Net Assets 7,812 9,227 4,292 85,566 (5,157) (31,836)
- ---------------------------------------------------------------------------------------------------------------------
Net Assets:
Beginning of Period .............. 126,000 116,773 85,566 -- 134,358 166,194
- ---------------------------------------------------------------------------------------------------------------------
End of Period .................... $133,812 $126,000 $89,858 $85,566 $129,201 $134,358
=====================================================================================================================
Shares Issued and Redeemed
Class I:
Shares Issued .................... 1,628 3,195 1,547 1,349 86,456 220,104
Shares Issued in Connection with
Acquisition of Common Trust
Fund Assets (See note 8) ....... -- -- -- 7,758 -- --
Shares Issued in Lieu of Cash
Distributions .................. -- -- -- -- 1 4
Shares Redeemed .................. (867) (2,527) (1,058) (750) (91,137) (186,643)
- ---------------------------------------------------------------------------------------------------------------------
Total Class I Share Transactions ... 761 668 489 8,357 (4,680) 33,465
- ---------------------------------------------------------------------------------------------------------------------
Class A:
Shares Issued .................... 33 -- 12 1 6,327 214,687
Shares Issued in Lieu of Cash
Distributions .................. -- -- -- -- 137 274
Shares Redeemed .................. -- (3) (5) -- (6,936) (280,270)
- ---------------------------------------------------------------------------------------------------------------------
Total Class A Share Transactions ... 33 (3) 7 1 (472) (65,309)
- ---------------------------------------------------------------------------------------------------------------------
Increase (Decrease) in Capital Shares 794 665 496 8,358 (5,152) (31,844)
=====================================================================================================================
Amounts designated as "--" are either $0 or have been rounded to $0.
<FN>
(1) Commenced operations on June 23, 1997
</FN>
</TABLE>
The accompanying notes are an integral part of the financial statements.
18 & 19
<PAGE>
FINANCIAL HIGHLIGHTS
For a Share Outstanding Throughout the Period
<TABLE>
<CAPTION>
For the Periods Ended July 31, 1998 (Unaudited) and the Periods Ended January 31,
NET REALIZED DISTRIBUTIONS NET NET
ASSET AND -------------------- ASSET ASSETS RATIO OF
VALUE NET UNREALIZED NET NET VALUE END EXPENSES
BEGINNING INVESTMENT GAIN (LOSS) INVESTMENT REALIZED END TOTAL OF PERIOD TO AVERAGE
OF PERIOD INCOME ON INVESTMENTS INCOME GAIN OF PERIOD RETURN+ (000) NET ASSETS
- -----------------------------------------------------------------------------------------------------------------------------
GROWTH PORTFOLIO CLASS I
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1998** $12.66 $ 0.02 $ 2.46 $(0.01) $ -- $15.13 19.59% $ 43,040 1.07%
1998 12.66 -- 3.12 -- (3.12) 12.66 25.85 36,240 1.07
1997 10.26 -- 2.44 (0.01) (0.03) 12.66 23.79 32,973 1.10
1996 10.00 0.07 1.74 (0.07) (1.48) 10.26 18.81 24,775 1.10
1995 10.82 0.08 (0.64) (0.08) (0.18) 10.00 (5.24) 32,931 1.10
1994(1) 10.00 0.08 0.82 (0.08) -- 10.82 9.08 24,955 1.10
GROWTH PORTFOLIO CLASS A
1998** $12.51 $ -- $ 2.43 $ -- $ -- $14.94 19.42% $ 458 1.32%
1998 12.57 (0.01) 3.07 -- (3.12) 12.51 25.56 307 1.32
1997 10.20 (0.03) 2.43 -- (0.03) 12.57 23.56 226 1.35
1996 9.96 0.04 1.72 (0.04) (1.48) 10.20 18.43 193 1.35
1995 10.81 0.05 (0.67) (0.05) (0.18) 9.96 (5.76) 125 1.35
1994(2) 9.54 0.02 1.27 (0.02) -- 10.81 22.00* 173 1.35*
VALUE PORTFOLIO CLASS I
1998** $ 9.33 $ 0.02 $ 0.86 $(0.02) $ -- $10.19 9.43% $ 36,258 1.10%
1998(3) 10.00 0.04 0.86 (0.04) (1.53) 9.33 9.15 30,922 1.10*
VALUE PORTFOLIO CLASS A
1998** $ 9.32 $ 0.02 $ 0.86 $(0.01) $ -- $10.19 9.45% $ 189 1.35%
1998(3) 10.00 0.02 0.86 (0.03) (1.53) 9.32 8.97 51 1.35*
INTERMEDIATE-TERM INCOME PORTFOLIO CLASS I
1998** $10.04 $ 0.28 $(0.01) $(0.28) $ -- $10.03 2.69% $133,415 0.65%
1998 9.83 0.56 0.21 (0.56) -- 10.04 8.07 125,936 0.65
1997 10.15 0.54 (0.32) (0.54) -- 9.83 2.31 116,689 0.65
1996 9.52 0.56 0.63 (0.56) -- 10.15 12.83 104,270 0.65
1995 10.19 0.50 (0.67) (0.50) -- 9.52 (1.61) 80,064 0.65
1994(1) 10.00 0.46 0.23 (0.46) (0.04) 10.19 6.99 64,329 0.65
INTERMEDIATE-TERM INCOME PORTFOLIO CLASS A
1998** $10.04 $ 0.26 $(0.01) $(0.26) $ -- $10.03 2.56% $ 397 0.90%
1998 9.83 0.53 0.21 (0.53) -- 10.04 7.78 64 0.90
1997 10.15 0.52 (0.32) (0.52) -- 9.83 2.05 84 0.90
1996 9.52 0.54 0.63 (0.54) -- 10.15 12.54 210 0.90
1995 10.19 0.48 (0.67) (0.48) -- 9.52 (1.85) 314 0.90
1994(2) 10.12 0.31 0.11 (0.31) (0.04) 10.19 6.72* 365 0.90*
MICHIGAN TAX FREE BOND PORTFOLIO CLASS I
1998** $10.24 $ 0.22 $(0.09) $(0.22) $ -- $10.15 1.29% $ 89,781 0.65%
1998(3) 10.00 0.27 0.26 (0.27) (0.02) 10.24 5.35 85,556 0.65*
MICHIGAN TAX FREE BOND PORTFOLIO CLASS A
1998** $10.24 $ 0.21 $(0.09) $(0.21) $ -- $10.15 1.16% $ 77 0.90%
1998(3) 10.00 0.27 0.26 (0.27) (0.02) 10.24 5.31 10 0.90*
=========================================================================================================================
RATIO OF RATIO OF
RATIO OF EXPENSES NET INCOME
NET TO AVERAGE TO AVERAGE
INCOME NET ASSETS NET ASSETS PORTFOLIO
TO AVERAGE (EXCLUDING (EXCLUDING TURNOVER
NET ASSETS WAIVERS) WAIVERS) RATE
- --------------------------------------------------------------------------------
GROWTH PORTFOLIO CLASS I
1998** 0.23% 1.07% 0.23% 31.03%
1998 0.03 1.07 0.03 131.54
1997 0.04 1.11 0.03 130.69
1996 0.62 1.17 0.55 189.48
1995 0.74 1.24 0.60 84.00
1994(1) 0.77 1.21 0.66 68.91
GROWTH PORTFOLIO CLASS A
1998** (0.02)% 1.32% (0.02)% 31.03%
1998 (0.21) 1.32 (0.21) 131.54
1997 (0.20) 1.36 (0.21) 130.69
1996 0.30 1.42 0.23 189.48
1995 0.49 1.49 0.35 84.00
1994(2) 0.33* 1.45* 0.23* 68.91
VALUE PORTFOLIO CLASS I
1998** 0.41% 1.10% 0.41% 68.38%
1998(3) 0.72* 1.28* 0.54* 90.97
VALUE PORTFOLIO CLASS A
1998** 0.16% 1.35% 0.16% 68.38%
1998(3) 0.31* 1.53* 0.13* 90.97
INTERMEDIATE-TERM INCOME PORTFOLIO CLASS I
1998** 5.56% 0.79% 5.42% 57.81%
1998 5.66 0.80 5.51 60.78
1997 5.48 0.80 5.33 34.67
1996 5.68 0.84 5.49 121.47
1995 5.21 0.86 5.00 141.51
1994(1) 4.47 0.83 4.29 71.73
INTERMEDIATE-TERM INCOME PORTFOLIO CLASS A
1998** 5.36% 1.04% 5.22% 57.81%
1998 5.40 1.05 5.25 60.78
1997 5.20 1.05 5.05 34.67
1996 5.49 1.09 5.30 121.47
1995 4.96 1.11 4.75 141.51
1994(2) 4.27* 1.08* 4.09* 71.73
MICHIGAN TAX FREE BOND PORTFOLIO CLASS I
1998** 4.37% 0.81% 4.21% 2.29%
1998(3) 4.41* 0.82* 4.24* 9.77
MICHIGAN TAX FREE BOND PORTFOLIO CLASS A
1998** 4.12% 1.06% 3.96% 2.29%
1998(3) 4.15* 1.07* 3.98* 9.77
================================================================================
<FN>
Amounts designated as "--" are either $0 or have been rounded to $0.
* Annualized
** For the period ended July 31, 1998 (Unaudited). All ratios for the period have been annualized. Total returns
are for the period indicated and have not been annualized.
+ Total return does not reflect the sales charge on Class A shares.
(1) Commenced operations February 1, 1993.
(2) Commenced operations June 18, 1993.
(3) Commenced operations June 23, 1997. Total return is for the period indicated and has not been annualized.
</FN>
</TABLE>
The accompanying notes are an integral part of the financial statements.
20
<PAGE>
<TABLE>
<CAPTION>
GOLDEN OAK FAMILY OF FUNDS
NET REALIZED DISTRIBUTIONS NET NET
ASSET AND -------------------- ASSET ASSETS RATIO OF
VALUE NET UNREALIZED NET NET VALUE END EXPENSES
BEGINNING INVESTMENT GAIN (LOSS) INVESTMENT REALIZED END TOTAL OF PERIOD TO AVERAGE
OF PERIOD INCOME ON INVESTMENTS INCOME GAIN OF PERIOD RETURN+ (000) NET ASSETS
- -----------------------------------------------------------------------------------------------------------------------------
PRIME OBLIGATION MONEY MARKET PORTFOLIO CLASS I
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1998** $ 1.00 $0.03 $ -- $(0.03) $ -- $ 1.00 5.42% $123,292 0.40%
1998 1.00 0.05 -- (0.05) -- 1.00 5.41 127,977 0.40
1997 1.00 0.05 -- (0.05) -- 1.00 5.21 94,508 0.40
1996 1.00 0.06 -- (0.06) -- 1.00 5.74 107,409 0.40
1995 1.00 0.04 -- (0.04) -- 1.00 4.21 109,076 0.40
1994(1) 1.00 0.03 -- (0.03) -- 1.00 2.87 117,188 0.40
PRIME OBLIGATION MONEY MARKET PORTFOLIO CLASS A
1998** $ 1.00 $0.02 $ -- $(0.02) $ -- $ 1.00 5.15% $ 5,909 0.65%
1998 1.00 0.05 -- (0.05) -- 1.00 5.15 6,381 0.65
1997 1.00 0.05 -- (0.05) -- 1.00 4.95 71,686 0.65
1996 1.00 0.05 -- (0.05) -- 1.00 5.47 75,293 0.65
1995 1.00 0.04 -- (0.04) -- 1.00 3.95 21,018 0.65
1994(2) 1.00 -- -- -- -- 1.00 2.90* 104 0.65*
===============================================================================================================================
RATIO OF RATIO OF
RATIO OF EXPENSES NET INCOME
NET TO AVERAGE TO AVERAGE
INCOME NET ASSETS NET ASSETS
TO AVERAGE (EXCLUDING (EXCLUDING
NET ASSETS WAIVERS) WAIVERS)
- --------------------------------------------------------------------------------
PRIME OBLIGATION MONEY MARKET PORTFOLIO CLASS I
1998** 5.29% 0.59% 5.10%
1998 5.29 0.59 5.10
1997 5.08 0.68 4.80
1996 5.60 0.70 5.30
1995 4.20 0.68 3.92
1994(1) 2.83 0.67 2.56
PRIME OBLIGATION MONEY MARKET PORTFOLIO CLASS A
1998** 5.04% 0.84% 4.85%
1998 4.99 0.84 4.80
1997 4.83 0.93 4.55
1996 5.31 0.95 5.01
1995 3.95 0.93 3.67
1994(2) 2.68* 0.93* 2.40
================================================================================
<FN>
Amounts designated as "--" are either $0 or have been rounded to $0.
* Annualized
** For the period ended July 31, 1998 (Unaudited). All ratios including total return for the period have been annualized.
+ Total return does not reflect the sales charge on Class A shares.
(1) Commenced operations February 1, 1993.
(2) Commenced operations January 20, 1994.
</FN>
</TABLE>
The accompanying notes are an integral part of the financial statements.
21
<PAGE>
NOTES TO FINANCIAL STATEMENTS GOLDEN OAK FAMILY OF FUNDS
July 31, 1998 Unaudited
1. Organization:
THE GOLDEN OAK FAMILY OF FUNDS are separate investment portfolios of The Arbor
Fund(the "Trust"). The Trust was organized as a Massachusetts business trust
under a Declaration of Trust dated July 24, 1992 and had no operations through
February 1, 1993 other than those related to organizational matters and the
sale of initial shares to SEI Investments Mutual Fund Services (the
"Administrator") on October 9, 1992. SEI Investments Management Corporation, a
wholly-owned subsidiary of SEI Investments Company, is the owner of all
beneficial interest in the Administrator. The Trust is registered under the
Investment Company Actof 1940, as amended (the "1940 Act") as an open-end
management company. These financial statements relate to the Trust's Golden Oak
Growth Portfolio (formerly Golden Oak Diversified Growth), Golden Oak Value
Portfolio, ("the Equity Portfolios"), Golden Oak Intermediate-Term Income
Portfolio, Golden Oak Michigan Tax Free Bond Portfolio, ("the Bond Portfolios"),
and Golden Oak Prime Obligation Money Market Portfolio ("the Money Market
Portfolio"), (together, the "Portfolios"). On August 11, 1997 the Trustees for
the Arbor Fund approved a name change for the Class A shares of each Portfolio
to the Institutional (Class I) shares, and the Class B shares to the Class A
shares. The Portfolios' prospectus provides a description of each Portfolio's
investment objectives, policies and strategies. The assets of each Portfolio are
segregated, and a shareholder's interest is limited to the Portfolio in which
shares are held. The financial statements have been prepared in accordance with
generally accepted accounting principles which require the use of management's
estimates. Actual results could differ from these estimates.
2. Significant Accounting Policies:
The following is a summary of the significant accounting policies followed by
the Portfolios.
SECURITY VALUATION -- Investments in equity securities which are traded on a
national securities exchange (or reported on the NASDAQ national market system)
are stated at the last quoted sales price if readily available for such equity
securities on each business day; other equity securities traded in the
over-the-counter market and listed equity securities for which no sale was
reported on that date are stated at the last quoted bid price. Debt obligations
exceeding sixty days to maturity for which market quotations are readily
available are valued at the most recently quoted bid price. Debt obligations
with sixty days or less remaining until maturity are valued at their amortized
cost. Restricted securities for which quotations are not readily available are
valued at fair value using methods determined in good faith under general
trustee supervision.
Investment securities held by the Money Market Portfolio are stated at amortized
cost which approximates market value. Under the amortized cost method, any
discount or premium is amortized ratably to the maturity of the security and is
included in interest income.
FEDERAL INCOME TAXES -- It is each Portfolio's intention to continue to qualify
as a regulated investment company for Federal income tax purposes by complying
with the appropriate provisions of the Internal Revenue Code of 1986, as
amended. Accordingly, no provision for Federal income taxes has been made in the
financial statements.
SECURITY TRANSACTIONS AND RELATED INCOME --Security transactions are accounted
for on the date the security is purchased or sold (trade date). Dividend income
is recognized on the ex-dividend date, and interest income is accrued as earned.
Costs used in determining realized gains and losses on sales of investment
securities are those of the specific securities sold. Purchase discounts and
premiums on securities held by the Bond Portfolios are accreted and amortized to
maturity using the effective interest
method.
22
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued) GOLDEN OAK FAMILY OF FUNDS
July 31, 1998 Unaudited
REPURCHASE AGREEMENTS -- The Portfolios invest in tri-party repurchase
agreements. It is the Trust's policy that securities held as collateral for
tri-party repurchase agreements are maintained in a segregated account by the
broker's custodian bank until maturity of the repurchase agreement. Provisions
of the repurchase agreements require 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 an insolvency proceeding, realization and/or retention of
the collateral by the Portfolios may be delayed or limited.
NET ASSET VALUE PER SHARE -- The net asset value per share of each Portfolio is
calculated each business day. In general, it is computed by dividing the assets
of each Portfolio, less its liabilities, by the number of outstanding shares of
the Portfolio.
CLASSES OF SHARES -- Class specific expenses are borne by that class. Income,
expenses and realized and unrealized gains and losses are allocated to the
respective classes on the basis of their relative daily net assets.
EXPENSES -- Expenses that are directly related to one of the Portfolios are
charged directly to that Portfolio. Other operating expenses of the Trust are
prorated to the Portfolios on the basis of relative net assets. Class A bears a
class specific 12b-1 fee.
DISTRIBUTIONS -- Distributions from net investment income are declared and paid
quarterly to Shareholders of the Equity Portfolios. Distributions from net
investment income for the Money Market Portfolio and the Bond Portfolios are
declared daily and paid to Shareholders on a monthly basis. Any net realized
capital gains on sales of securities are distributed to Shareholders at least
annually.
3. Administration and Distribution Agreements:
The Trust and the Administrator have entered into an Administration Agreement
(the "Administration Agreement"). Under terms of the Administration Agreement,
the Administrator is entitled to a fee that is calculated daily and paid monthly
at an annual rate of .20% of the average daily net assets of each of the
Portfolios. There is a minimum annual administration fee of $100,000 for each of
the Golden Oak Michigan Tax Free Bond Portfolio and the Golden Oak Value
Portfolio.
The Administrator serves as the shareholder servicing agent for the Portfolios.
Compensation for this service is paid under the Administration Agreement.
The Trust and SEI Investments Distribution Co.
(the "Distributor"), a wholly-owned subsidiary of SEI Investments Company, have
entered into a Distribution Agreement (the "Distribution Agreement"). The
Trustees have adopted a Distribution Plan pursuant to Rule 12b-1 of the 1940 Act
(the "Plan") on behalf of the Class A shares. The Plan provides for payment to
the Distributor at an annual rate of .25% of the average daily net assets for
the Class A shares of each Portfolio.
4. Investment Advisory Agreement:
The Trust has entered into an Investment Advisory Agreement with Citizens Bank
(the "Adviser") dated January 28, 1993 under which the Adviser receives an
annual fee equal to .34% of the average daily net assets of the Growth
Portfolio, .29% of the first $50 million, .39% of the next $50 million, and .34%
of any amount above $100 million of the average daily net assets of the Value
Portfolio, .50% of the average daily net assets of the Bond Portfolios and .225%
of the first $500 million and .28% of any amount above $500 million of the
average daily net assets of the Money Market Portfolio. The Adviser has
voluntarily agreed to waive all or a portion of its fees (and to
23
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued) GOLDEN OAK FAMILY OF FUNDS
July 31, 1998 Unaudited
reimburse each Portfolio's expenses) in order to limit operating expenses of the
Class I and Class A shares (exclusive of distribution expenses) to not more than
1.10% of the average daily net assets of the Equity Portfolios, .65% of the
average daily net assets of the Bond Portfolios and .40% of the average daily
net assets of the Money Market Portfolio. Fee waivers and expense reimbursements
are voluntary and may be terminated at any time.
Wellington Management Company, LLP serves as the investment sub-adviser for the
Money Market Portfolio pursuant to a sub-advisory agreement dated January 28,
1993 with the Trust and the Adviser and receives an annual fee, computed daily
and paid monthly, equal to .075% of the first $500 million and .02% of any
amount above $500 million of the average daily net assets of the Portfolio.
Nicholas-Applegate Capital Management serves as the investment sub-adviser for
the Growth Portfolio pursuant to a sub-advisory agreement dated August 31, 1995
with the Trust and the Adviser and receives an annual fee, computed daily and
paid monthly, equal to .40% of the average daily net assets of the Portfolio.
Systematic Financial Management, L.P. serves as the investment sub-adviser for
the Value Portfolio pursuant to a sub-advisory agreement dated June 23, 1997
with the Trust and the Adviser and receives an annual fee, computed daily and
paid monthly, equal to .45% of the first $50 million, .35% of the next $50
million, and .40% of any amount above $100 million of the average daily net
assets of the Portfolio.
5. Organizational Costs and Transactions with Affiliates:
Organizational costs have been capitalized by the Trust and are being amortized
over sixty months beginning with the commencement of operations. In the event
any of the initial shares of the Trust are redeemed by any holder thereof during
the period that the Trust is amortizing its organizational costs, the redemption
proceeds payable to the holder thereof by the Trust will be reduced by the
unamortized organizational costs in the same ratio as the number of initial
shares being redeemed bears to the number of initial shares outstanding at the
time of redemption. These costs include legal fees of approximately $14,400 for
organizational work performed by a law firm of which two officers of the Trust
and a trustee of the Trust are partners.
Certain officers and a trustee of the Trust are also officers of the
Administrator and/or Distributor. Such officers and trustee are not compensated
by the Trust for serving in their respective roles.
The Trust has paid legal fees to a law firm of which two officers of the Trust
and a trustee of the Trust are partners.
6. Investment Transactions:
The cost of security purchases and the proceeds from the sale of securities,
other than short-term investments during the period ended July 31, 1998, were as
follows:
24
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued) GOLDEN OAK FAMILY OF FUNDS
July 31, 1998 Unaudited
INTERMEDIATE- MICHIGAN
TERM TAX FREE
GROWTH VALUE INCOME BOND
(000) (000) (000) (000)
- --------------------------------------------------------------------------------
Purchases:
U.S. Government $ -- $ -- $40,717 $ --
Other ....... 12,442 26,446 35,119 6,866
Sales:
U.S. Government $ -- $ -- $45,680 $ --
Other ....... 12,056 23,783 20,610 1,957
At July 31, 1998, the total cost of securities and the net realized gains or
losses on securities sold for Federal income tax purposes were not materially
different from amounts for financial reporting purposes. The aggregate gross
unrealized appreciation and depreciation on investment securities at July 31,
1998 for the Equity and Bond Portfolios are as follows:
INTERMEDIATE- MICHIGAN
TERM TAX FREE
GROWTH VALUE INCOME BOND
(000) (000) (000) (000)
- ----------------------------------------------------
Aggregate Gross
Unrealized
Appreciation $10,550 $ 9,201 $1,740 $3,025
Aggregate Gross
Unrealized
Depreciation . (577) (1,496) (107) (19)
------ ------- ------ ------
Net Unrealized
Appreciation $ 9,973 $ 7,705 $1,633 $3,006
======= ======= ====== ======
7. Concentration of Credit Risk:
The Money Market Portfolio invests primarily in money market instruments
maturing in 397 days or less whose ratings are within the two highest ratings
categories assigned by a nationally recognized statistical rating organization
or, if not rated, are believed by the Sub-Adviser to be of comparable quality.
The Bond Portfolios invest primarily in marketable debt instruments. The market
value of these investments will change in response to interest rate changes
and other factors. During periods of falling interest rates, the values of debt
securities generally rise. Conversely, during periods of rising interest rates
the values of such securities generally decline. The ability of the issuers of
the securities held by these Portfolios to meet their obligations may be
affected by economic and political developments in a specific industry, state or
region. Changes by recognized rating organizations in the ratings of any debt
security and in the ability of an issuer to make payments of interest and
principal may also affect the value of these investments.
The Golden Oak Michigan Tax Free Bond Portfolio invests in debt instruments of
municipal issuers. The issuers' ability to meet their obligations may be
affected by economic developments in a specific state or region. The Golden Oak
Michigan Tax Free Bond invests primarily in obligations located in Michigan.
25
<PAGE>
NOTES TO FINANCIAL STATEMENTS (concluded) GOLDEN OAK FAMILY OF FUNDS
July 31, 1998 Unaudited
8. Common Trust Fund Conversions:
On June 23, 1997, certain Common Trust Funds of Citizens Bank and its affiliates
were converted into the Golden Oak Family of Funds. The Funds that were involved
in the conversion were as follows:
COMMON TRUST FUND GOLDEN OAK PORTFOLIO
- ------------------------------------------------
Tax Exempt Bond Fund Michigan Tax Free Bond
Portfolio
Value Equity Fund Value Portfolio
The assets which consisted of securities and related receivables, were converted
on a tax-free basis. The number of shares issued for each Fund and the net
assets (including unrealized appreciation) of each fund immediately before the
conversion were as follows:
COMMON NET UNREALIZED GOLDEN OAK
TRUST FUND ASSETS APPRECIATION SHARES ISSUED
- ----------------------------------------------------
Tax Exempt
Bond Fund $77,580,483 $ 1,803,730 7,758,048
Value Equity
Fund 26,599,230 12,716,514 2,659,923
26
<PAGE>
<PAGE>
THE GOLDEN OAK FAMILY OF FUNDS
GROWTH PORTFOLIO
VALUE PORTFOLIO
INTERMEDIATE-TERM INCOME PORTFOLIO
MICHIGAN TAX FREE BOND PORTFOLIO
PRIME OBLIGATION MONEY MARKET PORTFOLIO
INVESTMENT ADVISER:
CITIZENS BANK
328 SOUTH SAGINAW STREET
FLINT, MI 48502
DISTRIBUTOR:
SEI INVESTMENTS DISTRIBUTION CO.
OAKS, PA 19456
FOR INFORMATION, CALL:
1-800-545-6331
GOK-F-002-03
