<PAGE>
ABN-AMRO Funds
[LOGO APPEARS HERE]
[ARTWORK APPEARS HERE]
Annual
Report
December 31, 1998
<PAGE>
TABLE OF CONTENTS
Letter to Shareholders ............................1
Manager's Discussion and Analysis..................3
Report of Ernst & Young LLP,
Independent Auditors.........................21
Schedule of Investments...........................22
Statement of Assets and Liabilities...............56
Statement of Operations...........................59
Statement of Changes in Net Assets................62
Financial Highlights..............................68
Notes to Financial Statements.....................84
NOT FDIC INSURED . NO BANK GUARANTEE . MAY LOSE VALUE
ABN AMRO is a registered service mark of ABN AMRO Holding N.V., the ultimate
parent of ABN AMRO Asset Management (USA) Inc., the investment advisor to the
ABN AMRO Funds. All rights reserved. ABN AMRO Funds are distributed by First
Data Distributors, Inc. which is not a bank affiliate.
<PAGE>
Letter to Shareholders
Dear Shareholder:
What a year! 1998 was one of the most volatile periods the market has
experienced in recent times. So many factors were at play, from the Asian
currency crisis to the uncertainty in the White House to Russia's default. The
Federal Reserve's (the "Fed") bail out of a large hedge fund affected the
markets, as did its moves on interest rates. Also, the boom in Internet stocks
helped pull the stock market up toward the end of the year. A long-term outlook
and good securities selection helped to steady the course for the ABN AMRO
Funds. There were some exceptional bright spots, as well.
Rising disposable incomes, solid productivity gains and a confident consumer
helped along the strong U.S. economy and surging dollar. This environment
favored growth-oriented, earnings driven stocks. The ABN AMRO Growth Fund
bested the S&P 500 Index ("S&P 500") returning 30.23% (Common Shares Class) and
29.52% (Investor Shares Class), respectively, compared to 28.74% for the S&P
500 for the 1-year period ended 12/31/98. The Fund's focus on larger company
stocks with strong earnings growth put it on the upward path in 1998. It
continues to provide strong, consistent performance longer term. The Fund
(Common & Investor Shares) also carries a 4-STAR Morningstar* rating for the 3-
year and 5-year periods ended 12/31/98 in the Equity category (out of 2,802 and
1,702 funds, respectively). Keeping in mind the cyclical nature of growth and
value styles, the ABN AMRO Value Fund, with its focus on larger, undervalued
stocks, was out of favor this year and underperformed the market.
Small stocks again underperformed larger cap stocks, as has been the trend over
the past several years. The ABN AMRO Small Cap Growth Fund lagged its
benchmark, primarily due to Internet stocks. Many fledgling Internet firms
racked up stunning gains in 1998, but failed to record positive earnings. This
has made investments in these types of companies quite speculative, thus
limiting their entry into the portfolio. More broadly, small stocks have been
building attractive valuations compared to larger cap stocks, which could work
in their favor in 1999.
The U.S. Bond Market was certainly not immune to all the volatility. Falling
interest rates led to gains in bonds for the first half of the year. While the
economy remained strong, the Asian crisis and Russia's default contributed to
"safe haven" buying of U.S. Treasuries. The resulting liquidity and credit
crunch hurt the performance of non-Treasury sectors. ABN AMRO's Bond Funds were
competitive in 1998, as the Intermediate Government Fixed Income Fund ended the
year ranked #2 of 99 funds in Lipper's Short/Intermediate U.S. Government
category* (it is ranked 5 of 78 and 9 of 51 for the 3- and 5-year periods,
respectively, ended 12/31/98). The Fund outperformed its Lipper category
average 8.16% (Common Shares) and 7.56% (Investor Shares) to 6.58% for 1998 and
carries a 4-STAR Morningstar* rating (out of 1,488 funds) for the 3-year period
ended 12/31/98 in the Taxable Bond category. For the 5-year period, the Fund
received 3 stars, out of 987 funds. The ABN AMRO Money Market Funds provided
strong relative returns this year and continued to receive media attention.
Overseas markets were mixed. Europe started the year with a strong rally, then
went through a consolidation phase in the second quarter and sharp decline in
the third, and another rally in the fourth. Interest rate reductions helped
stocks despite the problems in Asia and Latin America, the weak economy in Japan
and the continuing conflict with Iraq. The ABN AMRO International Equity Fund
outperformed its benchmark Morgan Stanley's EAFE (Europe, Australia and Far
East) Index, 25.43% (Common Shares) and 24.87% (Investor Shares) to 20.00% for
the 1-year period ended 12/31/98. The EAFE Index is generally considered to be
representative of international markets outside the U.S. Like the Growth Fund,
ABN AMRO International Equity Fund has provided consistent long-term returns and
carries a 4-STAR Morningstar* rating (Common and Investor Shares) for the 3-year
and 5-year periods ended 12/31/98 in the Foreign Stock category (out of 862 and
407 funds, respectively). Look for ongoing reviews of the Fund in the various
Morningstar publications.
Asian economies continued to struggle in 1998 - the ongoing problem also proved
a shock to Latin markets. Russia's default on its debt impacted both regions
and capped the negative sentiment felt toward emerging markets during the year.
Both the ABN AMRO Asian Tigers and Latin America Equity Funds struggled, but
long-term prospects for both regions still appear positive.
We expect last year's volatility to continue in 1999, but we remain cautiously
optimistic for both stocks and bonds. Europe may mirror the U.S., with both
economies growing (but at a reduced rate) with low inflation.
In 1998, we addressed the ongoing year 2000 problem, also known as Y2K. Many
computer programs around the world use two digits instead of four to identify
the year, and assume the next century to be 1900 instead of 2000. If they
cannot distinguish the years, they may not function properly. This is,
essentially, what Y2K is all about.
1
<PAGE>
Letter to Shareholders (continued)
To provide shareholders with a smooth transition into the new millennium, the
Funds continue to work with their service providers (the Funds have no computer
systems of their own) to assess the adequacy of their own year 2000 readiness
efforts. Specifically, the Funds have asked their service providers (including
the investment adviser, administrator, distributor, transfer agent and
custodian) whether they expect to have their computer systems ready for the year
2000 transition. The Funds are seeking assurances from the service providers
that their computer systems will be ready for the transition. The Funds are
assessing all systems providing products or services to our shareholders, and
the Funds' service providers are taking steps to modify them where necessary.
Despite these efforts, however, shareholders may experience losses if the Funds'
service providers experience year 2000 difficulties. In addition, the Funds and
their shareholders may experience losses if issuers of portfolio securities or
third parties, such as custodians, banks, broker-dealers or others with which
the Funds do business, experience year 2000 difficulties.
Also of note, the first business day of 1999 saw the birth of the Euro.
Investors and borrowers immediately embraced this eagerly awaited currency and
the scheduled conversion of relevant ABN AMRO Fund holdings went smoothly.
Because this composite currency is a superior substitute for the 11 underlying
currencies, Euro bonds quickly accounted for 50% of all the international bonds
issued in January. This is a record by far. Stock investors in Europe showed
their approval by pushing prices up more than 4% on the first day. Since then,
the Euro has reached a disciplined equilibrium. We think it is likely that the
Euro will confound its skeptics. The efficiency arguments are strong, both for
Europeans and for the rest of us. Will the Euro be as strong as the Dollar?
Probably. Will it succeed? So far, so good. Will it hurt the Dollar? We
believe not any time soon.
Given the fast pace of the Internet, and the changing needs of our shareholders,
we introduced a new, sleeker version of the ABN AMRO Funds web site
"http://www.abnamrofunds-usa.com". We hope you find it easier to use, with
faster access to the information you need. We will be adding additional links
over time, to put more of ABN AMRO's global resources at your disposal.
Thank you for the opportunity to serve your investment needs. We truly value
your business.
Sincerely,
/s/ Timothy J. Leach,
Timothy J. Leach,
President President & CEO
ABN AMRO Funds ABN AMRO Asset Management (USA) Inc.
*Note: Past performance is no guarantee of future results. Lipper rankings are
based on average annual total returns only, for the periods noted. Morningstar
proprietary ratings are based on historical risk-adjusted performance and may
change monthly. Ratings are calculated using a fund's average annual total
returns in excess of 90-day Treasury bill returns with appropriate fee
adjustments and a risk factor that reflects fund performance below 90-day
Treasury bill returns. The top 10% of funds receive 5-stars; the next 22.5% of
funds receive 4-stars. The next 35% receive 3-stars.
2
<PAGE>
DECEMBER 31, 1998
Manager's Discussion and Analysis
Money Market Funds
In the beginning of the year the economy seemed to be growing strong. Concerns
that the Fed would have to raise rates caused havoc among the emerging markets.
Deteriorating economies in many Asian countries caused the dollar to strengthen
against those currencies as well as some European currencies. As the year
progressed, the Fed actually had to lower rates to provide liquidity to the
system helping to avoid a global recession. Federal Funds were lowered by 3/4
of 1% in three separate moves.
The flight-to-quality trade caused the Treasury market to do better affecting
credit spreads in all maturities within the fixed income market. The spreads
between short-term Government securities and commercial paper or bank
liabilities increased profoundly. Many investors sought refuge in both Treasury
and Government based funds because of the credit crunch experienced within the
marketplace.
By the fourth quarter, the market had priced in more rate cuts than the Advisor
believed were likely. The average maturity was shortened and cash balances
increased to take advantage of seasonal factors. As for the specifics on each
Fund:
Money Market Fund
The Fund's assets grew by 57% during 1998. This growth compares with a 29%
increase for all money market funds as reported by IBC Financial Money Fund
Report. The average maturity of the Fund was in a wide range for 1998. As it
became clearer that rates were not going up, but trending lower, the average
maturity was lengthened to 74 days, the longest it has ever been. We took
advantage of the spread widening in the Fund, greatly reducing government
holdings. Asset backed commercial paper was especially attractive close to
year-end.
Government Money Market Fund
The Fund's assets grew by 84% during 1998. The average maturity of the Fund was
in a wide range for 1998. As rates trended lower, the average maturity was
lengthened to 80 days, the longest it has ever been.
3
<PAGE>
MANAGER'S DISCUSSION AND ANALYSIS (continued)
Treasury Money Market Fund
The Fund's assets grew by 77% during 1998 and the Fund added the ability to buy
repurchase agreements as an investment. Like our other taxable Money Market
Funds, the average maturity of the Fund was in a wide range for the year.
Although it was clear that rates were coming down, the flight-to-quality trade
caused Treasury bill prices to soar, making it less attractive to maintain a
long average maturity.
Tax-Exempt Money Market Fund
The Fund experienced asset growth of 34% during 1998. The Fund's average
maturity fluctuated between 30-50 days reflecting not only the periodic cash
flows that occur, but also the lack of supply of short-term notes during most of
the year. The Fund purchased commercial paper throughout the curve to take
advantage of the Fed's early bias to raise rates. The Fund also acquired short
variable rate demand notes, which become attractive during tax time and year-end
due to liquidity needs. When the Fed eased rates during the 4th quarter, the
Fund acquired 30-day commercial paper and reduced some of its cash holdings.
Money Market Funds Outlook
Looking forward, we will continue to search for additional yield pick up over
the current Federal Funds level. We will seek investment opportunity in the
longer part of the curve for the taxable Money Market Funds, as the likelihood
of a rate reduction wanes and the yield curve steepens. For the Tax-Exempt
Money Market Fund, the Advisor expects to keep the maturity around 50 days, but
will extend it, if opportunities arise at the longer end of the yield curve.
4
<PAGE>
DECEMBER 31, 1998
Fixed Income Fund
For most bond investors, 1998 was a very tumultuous year. Interest rates fell
dramatically throughout the year. Long-term Treasury rates began the period at
5.90% and ended at 5.09%. Meanwhile, short-term rates also dropped
significantly. One-year Treasury rates began the year at 5.47% and ended at
4.50%. On the economic front, consensus expectations for a slowing economy due
to the drag from the Asian Crisis never materialized. U.S. consumers continued
to spend at a rapid pace supporting the domestic economy, while other major
industrialized economies languished. However, the U.S. Bond Market did not fare
as well during the third and fourth quarters. Russia's default resulted in a
tremendous liquidity and credit crunch that caused yields on non-Treasury
securities to rise to levels not seen since the last recession. The impact was
so great that it erased most of the reward bond investors had achieved through
the first half of the year, contributing significantly to the underperformance
of non-Treasury sectors relative to Treasuries for the year.
Performance of the Fixed Income Fund benefited from our overweight to duration
throughout the year. An overweight to duration should cause a bond portfolio to
appreciate in price faster than the benchmark. However, the Fund's exposure to
non-Treasury sectors limited returns. Corporate bonds had the worst performance
of all the sectors, followed by mortgage-backs and asset backs. We were
generally neutral to mortgage-backs throughout the year, but our overweight to
corporate securities hurt performance.
Looking forward, many themes and risks remain. Inflation is benign, the economy
remains subject to external shocks, and the dollar has increased competition
from the euro. Meanwhile, the bond market remains subject to liquidity scares.
As a result, we intend to focus on quality in our corporate credits and high
liquidity in our mortgage-backed sector. We remain cautiously optimistic about
the direction of interest rates, as the economy slows and inflation remains low.
COMMON SHARE CLASS
[CHART APPEARS HERE]
Comparison of Change in Value of a $10,000 Investment
Lipper Intermediate
ABN AMRO Lehman Brothers Investment-Grade Debt
Fixed Income Fund Aggregate Bond Index Funds Average Index
1/4/93* 10000 10000 10000
Dec-93 10982 10974 11023
Dec-94 10562 10654 10627
Dec-95 12434 12623 12448
Dec-96 12862 13081 12857
Dec-97 14048 14344 13964
Dec-98 15051 15590 15014
INVESTOR SHARE CLASS
[CHART APPEARS HERE]
Comparison of Change in Value of a $10,000 Investment
Lipper Intermediate
ABN AMRO Lehman Brothers Investment-Grade Debt
Fixed Income Fund Aggregate Bond Index Funds Average Index
3/12/93* 10000 10000 10000
Dec-93 10570 10583 10599
Dec-94 10151 10274 10221
Dec-95 11917 12172 11954
Dec-96 12302 12614 12349
Dec-97 13400 13832 13411
Dec-98 14313 15034 14416
* Inception Date
[CAPTION]
<TABLE>
Average Annual Average Annual
Class of Shares One-Year Return 5 Year Return Inception to Date
<S> <C> <C> <C>
Common 7.13% 6.50% 7.06%
Investor 6.81% 6.25% 6.37%
</TABLE>
For the period ended December 31, 1998. Past performance of the Fund does not
predict future results. Indexes are used for comparative performances only. All
indexes are not managed, are not available for investment and, unlike all mutual
funds, they do not assess fees.
5
<PAGE>
MANAGER'S DISCUSSION AND ANALYSIS (continued)
Intermediate Government Fixed Income Fund
Interest rates fell dramatically throughout the year, while on the economic
front, consensus expectations for a slowing economy due to the drag from the
Asian Crisis never materialized. U.S. consumers continued to spend at a rapid
pace supporting the domestic economy, while other major industrialized economies
languished. However, the U.S. Bond Market did not fare as well during the third
and fourth quarters. Russia's default resulted in a tremendous liquidity and
credit crunch that caused yield spreads on non-Treasury securities to rise to
levels not seen since the last recession.
Our shift away from mortgages during this year's volatility helped the
Intermediate Government Fixed Income Fund's performance by concentrating
holdings in sectors that would benefit from lower rates. Also, the decision to
use longer duration securities improved the price performance of the Fund as
rates moved downward.
As the rally dissipated in the fourth quarter and spreads of mortgage securities
widened out, the Advisor added to the mortgage position and emphasized income
return for the remainder of the year.
Most of the mortgage sector growth has come at the expense of agency debenture
sales to accommodate Fund liquidations. We expect to continue to increase the
allocation to mortgage securities, in anticipation of more stable interest
rates, and to capture more of the income return that the sector offers.
COMMON SHARE CLASS
[CHART APPEARS HERE]
Comparison of Change in Value of a $10,000 Investment
ABN AMRO Lipper Short/Intermediate
Intermediate Government Lehman Brothers U.S. Government
Fixed Income Fund Government Bond Index Funds Average Index
1/4/93* 10000 10000 10000
Dec-93 10598 11065 10705
Dec-94 10303 10692 10412
Dec-95 11732 12653 11752
Dec-96 12144 13004 12206
Dec-97 13107 14250 13042
Dec-98 14177 15654 13913
INVESTOR SHARE CLASS
[CHART APPEARS HERE]
Comparison of Change in Value of a $10,000 Investment
ABN AMRO Lipper Short/Intermediate
Intermediate Government Lehman Brothers U.S. Government
Fixed Income Fund Government Bond Index Funds Average Index
4/12/93* 10000 10000 10000
Dec-93 10244 10587 10364
Dec-94 9933 10230 10087
Dec-95 11283 12106 11396
Dec-96 11656 12441 11829
Dec-97 12549 13634 12642
Dec-98 13499 14978 13494
* Inception Date
[CAPTION]
<TABLE>
Average Annual Average Annual
Class of Shares One-Year Return 5 Year Return Inception to Date
<S> <C> <C> <C>
Common 8.16% 5.99% 6.00%
Investor 7.56% 5.67% 5.38%
</TABLE>
For the period ended December 31, 1998. Past performance of the Fund does not
predict future results. Indexes are used for comparative performances only. All
indexes are not managed, are not available for investment and, unlike all mutual
funds, they do not assess fees.
6
<PAGE>
December 31, 1998
Tax-Exempt Fixed Income Fund
The Fund's performance benefited from the Advisor's duration and sector exposure
during most of the year. The Advisor kept the Tax-Exempt Fixed Income Fund's
duration neutral to the market to begin the year, but soon extended duration as
signs of economic turmoil in Asia and domestic economic fundamentals showed only
trace amounts of inflation. These factors continued to transpire during the
second quarter as yields trended lower.
The third quarter saw dramatic changes within the Fund as well as in the
economy. The Fund extended its duration to the maximum during August due to very
strong underlying financial fundamentals present in the market at that time.
However, as world economic conditions appeared not as dire and domestic growth
showed signs of weakness, duration was reduced to a moderate overweight. With
Treasury yields at historic lows, housing bonds did not perform as well as other
sectors due to refinancing. The Fund sold a portion of these securities and
invested the proceeds into general obligation and revenue bonds. The Fed
implemented interest rate easing during the fourth quarter due to a softening
domestic economy. As a result, the short end of the curve out-performed the
longer end. However, the Fund held no securities less than five years, which
adversely affected performance during the fourth quarter.
Looking ahead to 1999, the Fund plans to continue to concentrate on securities
with maturities of 10-22 years as well as 1-5 years, due to the Fed's bias
toward lower rates. The Fund expects to continue to purchase essential service
and well-capitalized revenue bonds that provide performance and price return.
COMMON SHARE CLASS
ABN Tax-Exempt Fixed Income Lehman Brother Lipper General
12/31/92 10000 10000 10000
Dec - 93 10855 11228 11251
Dec - 94 10320 10648 10529
Dec - 95 11937 12506 12327
Dec - 96 12291 13060 12765
Dec - 97 13441 14261 13951
Dec - 98 14220 15185 14721
Comparison of Change in Value of a $10,000 Investment
INVESTOR SHARE CLASS
ABN Tax-Exempt Fixed Income Lehman Brother Lipper General
2/28/93 10000 10000 10000
Dec - 93 10442 10711 10697
Dec - 94 9892 10158 10006
Dec - 95 11419 11931 11714
Dec - 96 11727 12459 12126
Dec - 97 12795 13605 13251
Dec - 98 13475 14486 13978
Comparison of Change in Value of a $10,000 Investment
* Inception Date
Average Annual Average Annual
Class of Shares One-Year Return 5 Year Return Inception to Date
- -------------------------------------------------------------------------
Common 5.79% 5.55% 6.05%
- -------------------------------------------------------------------------
Investor 5.31% 5.23% 5.26%
- -------------------------------------------------------------------------
For the period ended December 31, 1998. Past performance of the Fund does not
predict future results. Indexes are used for comparative performances only. All
indexes are not managed, are not available for investment and, unlike all mutual
funds, they do not assess fees.
<PAGE>
MANAGER'S DISCUSSION AND ANALYSIS (continued)
International Fixed Income Fund
The ABN AMRO International Fixed Income Fund had a limited risk exposure during
1998. The Fund was not seriously hurt by the fall of credit markets and had no
emerging markets exposure. Also, it did not short currencies, but underweighted
currencies like the yen and, therefore, was not as hurt as those funds which
shorted the yen. Still, an underweighted yen position was the main reason for
the Fund's underperformance versus the benchmark, the J.P. Morgan Global
Government Non-U.S. Bond Index. The fall of the Australian and Canadian
currencies led to some underperformance as they were not fully hedged during the
year. Being overweight duration throughout the whole year proved helpful in most
of the regions where the Fund had bond allocations.
The absolute performance of the Fund was substantial after several poor years:
this reflected the fall of the dollar in the second half of the year versus both
the yen and most of the European currencies. Investors should keep in mind that
this Fund has limited exposure to the U.S. dollar and serves as a
diversification tool for those investors who seek non-U.S. dollar currency and
bond exposure in particular. For the latter part of 1998, this finally started
to pay off.
Looking ahead, a smaller version of the Asian crisis may unfold in Brazil, but
should not have a comparable impact: not only could this crisis be better
handled after all the experiences Asian financial institutions lived through,
the fundamental position of the Latin American region does not seem as serious.
In sum, we assume that this crisis might not endure and may be better managed.
The rest of the world, where most of the economic activity takes place, shows a
diverging trend: Japan is still trying to get out of recession and for 1999 that
could prove difficult despite massive stimulation programs.
Europe seems in a softening growth pattern, though some parts still show
vigorous growth (Ireland, Denmark and Holland). Larger countries like Germany,
France and Italy need structural changes, in particular in their rigid and often
too expensive labor markets, before they can show a revival. With very low
inflation numbers indeed, the European Central Bank felt confident enough to
lower money market rates in December. All members of the European Monetary Union
had similar money market rates, about 3%, at the end of 1998. The likely fall of
the U.S. dollar (the current account of $250-300 billion is not sustainable)
could exacerbate further downside pressure on European inflation. Even without
such a currency movement, inflation seems set to remain very low and most
probably even lower than in 1998 and lower than in the U.S. (1.5% versus about
2%). Generally duration may be kept overweighted in this environment.
Predicting the yen's movement seems the most hazardous job into the new year.
The recent intervention by the Bank of Japan, that sold yen for dollars, is an
indication of the perceived strength of the currency and strengthens our
underweight stance of the currency. Still we don't anticipate shorting the
currency, but may only underweight it versus the benchmark - at the end of 1998
the exposure to the yen was 16% versus 24% for the benchmark.
<PAGE>
December 31, 1998
International Fixed Income Fund
(continued)
COMMON SHARE CLASS
- --------------------------------------------------------------------------------
ABN International Fixed Income J.P. Morgan Lipper Int'l
- --------------------------------------------------------------------------------
1/31/93 10000 10000 10000
- --------------------------------------------------------------------------------
Dec - 93 11479 11302 11632
- --------------------------------------------------------------------------------
Dec - 94 11310 11859 10959
- --------------------------------------------------------------------------------
Dec - 95 13685 14364 12973
- --------------------------------------------------------------------------------
Dec - 96 14071 15121 14146
- --------------------------------------------------------------------------------
Dec - 97 13246 14550 14243
- --------------------------------------------------------------------------------
Dec - 98 15253 17210 16043
- --------------------------------------------------------------------------------
Comparison of Change in Value of a $10,000 Investment
INVESTOR SHARE CLASS
- --------------------------------------------------------------------------------
ABN International Fixed Income J.P. Morgan Lipper Int'l
- --------------------------------------------------------------------------------
4/30/93 10000 10000 10000
- --------------------------------------------------------------------------------
Dec - 93 10396 10544 11062
- --------------------------------------------------------------------------------
Dec - 94 10218 11063 10485
- --------------------------------------------------------------------------------
Dec - 95 12331 13400 12435
- --------------------------------------------------------------------------------
Dec - 96 12653 14106 13457
- --------------------------------------------------------------------------------
Dec - 97 11874 13574 13361
- --------------------------------------------------------------------------------
Dec - 98 13637 16055 15100
- --------------------------------------------------------------------------------
Comparison of Change in Value of a $10,000 Investment
* Inception Date
Average Annual Average Annual
Class of Shares One-Year Return 5 Year Return Inception to Date
Common 15.15% 5.85% 7.42%
Investor 14.84% 5.58% 5.61%
For the period ended December 31, 1998. Past performance of the Fund does not
predict future results. Indexes are used for comparative performances only. All
indexes are not managed, are not available for investment and, unlike all mutual
funds, they do not assess fees.
<PAGE>
MANAGER'S DISCUSSION AND ANALYSIS (continued)
Balanced Fund
1998 was a volatile year for the U.S. equity market. The market got off to a
shaky start in January, but managed to continue its record breaking upward
march. By February, the bulls were firmly back in control and the market logged
very solid returns in February and March. The market then went sideways for most
of the second quarter, staging a small rally in the final two weeks of the
quarter, which continued into the start of the third quarter. The market peaked
on July 17th and proceeded to fall through the rest of July and August. It
bottomed on August 31st, for a peak to trough decline of 19.3%, just short of an
official bear market. An attempt at a rally fizzled in September and the market
tested its August lows on October 8. The Fed surprised the market with a second
rate cut on October 16 and the market soared. The rally continued almost
uninterrupted through the end of the year. The S&P 500, which had ended the
third quarter up 5.8% for the year, tacked on a further 21.3% in the fourth
quarter to end the year up 28.7%.
The rally, however, was concentrated in the large capitalization growth stocks.
Small capitalization stocks were actually down for the year and value stocks
fell further and further behind growth stocks as the year progressed. Foreign
stocks mimicked the performance of the U.S. equity market, but only generated a
return of 18.6% for the year as measured by the EAFE Index. The U.S. fixed
income market had a decent year but the returns from bonds badly lagged stocks
at 8.7%.
Consequently, the Balanced Fund saw a very strong performance by the large cap
growth component, which was offset by weak performances by the large cap value
and small cap value allocations. While our foreign stocks and fixed income
components did reasonably well against their benchmarks, they did not contribute
significantly to the overall return in 1998.
<TABLE>
<CAPTION>
COMMON SHARE CLASS
Comparison of Change in Value of a $10,000 Investment
- -----------------------------------------------------------------------------------
Label A B C
- -----------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Label ABN Balanced Fund 60% S&P Com Lipper Flexible Por
- -----------------------------------------------------------------------------------
1 12/31/92 10000 10000 10000
- -----------------------------------------------------------------------------------
2 Dec-93 10767 10993 11178
- -----------------------------------------------------------------------------------
3 Dec-94 10540 10952 10963
- -----------------------------------------------------------------------------------
4 Dec-95 12853 14250 13770
- -----------------------------------------------------------------------------------
5 Dec-96 14532 16545 15710
- -----------------------------------------------------------------------------------
6 Dec-97 17743 20823 18699
- -----------------------------------------------------------------------------------
7 Dec-98 19513 25657 21778
- -----------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
INVESTOR SHARE CLASS
Comparison of Change in Value of a $10,000 Investment
- -----------------------------------------------------------------------------------
Label A B C
- -----------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Label ABN Balanced Fund 60% S&P Com Lipper Flexible Por
- -----------------------------------------------------------------------------------
1 2/28/93 10000 10000 10000
- -----------------------------------------------------------------------------------
2 Dec-93 19329 10693 10940
- -----------------------------------------------------------------------------------
3 Dec-94 10093 10665 10731
- -----------------------------------------------------------------------------------
4 Dec-95 12265 13871 13469
- -----------------------------------------------------------------------------------
5 Dec-96 13843 16113 15373
- -----------------------------------------------------------------------------------
6 Dec-97 16861 20292 18316
- -----------------------------------------------------------------------------------
7 Dec-98 18499 25014 21335
- -----------------------------------------------------------------------------------
8
- -----------------------------------------------------------------------------------
</TABLE>
* Inception Date
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------
Average Annual Average Annual
Class of Shares One-Year Return 5 Year Return Inception to Date
- ----------------------------------------------------------------------------
<S> <C> <C> <C>
Common 9.97% 12.63% 11.81%
- ----------------------------------------------------------------------------
Investor 9.72% 12.36% 11.16%
- ----------------------------------------------------------------------------
</TABLE>
For the period ended December 31, 1998. Past performance of the Fund does not
predict future results. Indexes are used for comparative performances only. All
indexes are not managed, are not available for investment and, unlike all mutual
funds, they do not assess fees.
10
<PAGE>
December 31, 1998
Value Fund
1998 was a volatile year for the U.S. equity market and one which favored growth
oriented stocks over value stocks. The market got off to a shaky start in
January, but managed to continue its record breaking upward march. By February,
the bulls were firmly back in control and the market logged very solid returns
in February and March. The market then went sideways for most of the second
quarter, staging as small rally in the final two weeks of the quarter, which
continued into the start of the third quarter. The market peaked on July 17th
and proceeded to fall through the rest of July and August. It bottomed on August
31st, for a peak to trough decline of 19.3%, just short of an official bear
market. An attempt at a rally fizzled in September and the market tested its
August lows on October 8. The Fed surprised the market with a second rate cut on
October 16 and the market soared. The rally continued almost uninterrupted
through the end of the year. The S&P 500, which had ended the third quarter up
5.8% for the year, tacked on a further 21.3% in the fourth quarter to end the
year up 28.7%.
The rally, however, was concentrated in the large capitalization growth stocks.
Small capitalization stocks were actually down for the year and value stocks
fell further and further behind growth stocks as the year progressed.
The best sectors were heavily dominated by the high flying growth stocks while
the worst sectors were primarily value stocks. The best performing sectors of
the S&P 500 were Technology, Communication Services, Health Care and Consumer
Cyclicals. The Fund's value style of investing tends not to include many stocks
in these sectors. As a result, the Fund significantly underperformed the Index.
For example, while Technology accounts for 19% of the S&P 500 it is only 10% of
the S&P Value Index and only 9% of the Value Fund's holdings at December 31,
1998. Similarly Health Care was 12% of the S&P 500 and only 2% of the S&P Value
Index and only 3% of the Value Fund's holdings at December 31, 1998. Conversely,
the worst performing sectors were Basic Materials, Transportation, Energy and
Financials. Financials, for example, are 15% of the S&P 500, 26% of the S&P
Value Index and 33% of the Value Fund's holdings at December 31, 1998. Energy is
6% of the S&P 500, 13% of the S&P Value Index and 9% of the Value Fund's
holdings at December 31, 1998. Any value manager who was true to a value
discipline did poorly relative to the S&P 500.
COMMON SHARE CLASS
Comparison of Change in Value of a $10,000 Investment
- ----------------------------------------------------------------------------
ABN Value Fund S&P Lipper
- ----------------------------------------------------------------------------
1 12/31/92 10000 10000 10000
- ----------------------------------------------------------------------------
2 Dec-93 10666 11007 11233
- ----------------------------------------------------------------------------
3 Dec-94 10666 11153 11152
- ----------------------------------------------------------------------------
4 Dec-95 14082 15344 14626
- ----------------------------------------------------------------------------
5 Dec-96 16959 18867 17690
- ----------------------------------------------------------------------------
6 Dec-97 22130 25162 22582
- ----------------------------------------------------------------------------
7 Dec-98 23340 32389 26060
- ----------------------------------------------------------------------------
INVESTOR SHARE CLASS
Comparison of Change in Value of a $10,000 Investment
- ----------------------------------------------------------------------------
ABN Value Fund S&P Lipper
- ----------------------------------------------------------------------------
1 3/31/98 10000 10000 10000
- ----------------------------------------------------------------------------
2 Dec-93 10176 10545 10706
- ----------------------------------------------------------------------------
3 Dec-94 10155 10683 10628
- ----------------------------------------------------------------------------
4 Dec-95 13377 14694 13943
- ----------------------------------------------------------------------------
5 Dec-96 16064 18065 16867
- ----------------------------------------------------------------------------
6 Dec-97 20916 24090 21552
- ----------------------------------------------------------------------------
7 Dec-98 21891 30980 24885
- ----------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Average Annual Average Annual
Class of Shares One-Year Return 5 Year Return Inception to Date
- ---------------------------------------------------------------------------
Common 5.47% 16.96% 15.20%
- ---------------------------------------------------------------------------
Investor 4.66% 16.56% 14.55%
- ---------------------------------------------------------------------------
* Inception Date
For the period ended December 31, 1998. Past performance of the Fund does not
predict future results. Indexes are used for comparative performances only. All
indexes are not managed, are not available for investment and, unlike all mutual
funds, they do not assess fees.
11
<PAGE>
MANAGER'S DISCUSSION AND ANALYSIS (continued)
Growth Fund
Capping a year of incredible volatility, the equity market rallied with the Dow
Jones Industrials Average posting double digit gains for a historic fourth year
in a row. Less than stellar corporate earnings, emerging market concerns, and
domestic political turmoil created a tough environment for equity securities.
Lower interest rates and reduced inflation expectations, however, helped
overcome these obstacles with large cap, growth oriented stocks leading the
rally.
Excellent sector selection fueled the Growth Fund's superior performance. An
overweighting in technology, the market's best performing group, was a major
contributor as was overexposure in health care which benefited from a low
inflationary environment and significant new drug launches. A heavy weighting in
consumer cyclicals also proved beneficial as American consumers enjoyed the
strongest growth in real purchasing power in over two decades. The Fund's
limited exposure in basic materials and energy was advantageous as these sectors
suffered due to falling commodity prices. Additionally enhancing the Fund's
strong return was favorable stock selection in capital goods, consumer services,
and consumer staples.
Despite the longest peacetime economic expansion, the economy continues to move
forward. While the overseas markets experience turmoil, U.S. Gross Domestic
Product ("GDP") continues to be bolstered by rising disposable income, solid
productivity gains, and a confident consumer. Although exports represent a
substantial portion of total GDP, the move by many U.S. companies to proprietary
products, particularly in the technology, health care, and finance sectors, has
alleviated some of the effects of the overseas downturn. Our outlook is for a 5-
6% increase in corporate profits with an inflation rate of roughly 2%. Such an
environment should bode well for growth oriented stocks, and we remain
comfortable with our overweighted positions in technology, consumer cyclicals,
and health care.
COMMON SHARE CLASS
Comparison of Change in Value of a $10,000 Investment
[Line graph appears here]
S&P 500 Lipper
ABN AMRO Composite Growth Funds
Growth Fund Index Average Index
----------- --------- -------------
1/4/93* 10,000 10,000 10,000
December 1993 10,501 11,007 11,132
December 1994 10,286 11,153 10,956
December 1995 13,536 15,344 14,473
December 1996 16,473 18,867 17,306
December 1997 19,623 25,162 21,893
December 1998 26,598 32,389 26,606
INVESTOR SHARE CLASS
Comparison of Change in Value of a $10,000 Investment
[Line graph appears here]
S&P 500 Lipper
ABN AMRO Composite Growth Funds
Growth Fund Index Average Index
----------- --------- -------------
3/8/93* 10,000 10,000 10,000
December 1993 10,020 10,545 11,139
December 1994 9,777 10,683 10,961
December 1995 12,837 14,694 14,465
December 1996 13,743 18,065 17,292
December 1997 19,271 24,090 21,843
December 1998 24,959 30,980 26,575
* Inception Date
Average Annual Average Annual
Class of Shares One-Year Return 5 Year Return Inception to Date
- --------------- --------------- -------------- -----------------
Common 30.23% 20.43% 17.74%
Investor 29.52% 20.03% 17.03%
For the period ended December 31, 1998. Past performance of the Fund does not
predict future results. Indexes are used for comparative performances only. All
indexes are not managed, are not available for investment and, unlike all mutual
funds, they do not assess fees.
12
<PAGE>
DECEMBER 31, 1998
International Equity Fund
1998 was a turbulent year for the stock markets in the EAFE Index. The best
performing industries were electronic components, electronics and electrical,
data processing, business and public services, merchandising, telecommunication
and insurance. Health care and consumer goods performed more in line with
markets, whereas materials, energy and energy related and transport industries
strongly underperformed. By focusing on the globalization trend, the quality of
life trend and information technology, the International Equity Fund was
overweighted in several of the best performing industries. The Sub-Advisor's
focus on these industries and corporate earnings led to an overweight in Europe
and an underweighted position in Asia which greatly enhanced returns for the
year.
Going forward, the Sub-Advisor is relatively positive on equity markets,
although it is believed that volatile times are ahead. For Europe, we anticipate
positive but declining economic growth, low inflation and stable, maybe even
declining interest rates. From an investment standpoint, the capital goods,
health care, services, and the financial sectors in Europe are interesting based
on earnings growth expectations. For Japan, the prospects for economic growth
and earnings growth are bleak. No support of even lower interest rates can be
expected here. In Japan, we stress the export industry as long-term earnings
prospects are relatively good, although a strong yen could develop into a
problem for this part of the economy. Our industry approach at the moment
mirrors 1998; with an overweight position in Europe, an underweight position in
Asia and a strong underweight position in Japan.
COMMON SHARE CLASS
[CHART APPEARS HERE]
Comparison of Change in Value of a $10,000 Investment
ABN AMRO International Morgan Stanley Lipper International
Equity Fund MSCI EAFE Index Funds Average Index
1/4/93* 10000 10000 10000
Dec-93 12626 13256 13612
Dec-94 13044 14287 13518
Dec-95 14874 15888 14957
Dec-96 16375 16849 16874
Dec-97 17121 17148 17858
Dec-98 21476 20577 20182
INVESTOR SHARE CLASS
[CHART APPEARS HERE]
Comparison of Change in Value of a $10,000 Investment
ABN AMRO International Morgan Stanley Lipper International
Equity Fund MSCI EAFE Index Funds Average Index
4/12/93* 10000 10000 10000
Dec-93 11542 11837 12565
Dec-94 11898 12757 12462
Dec-95 13539 14187 13774
Dec-96 14872 15045 15520
Dec-97 15508 15313 16439
Dec-98 19366 18375 18563
* Inception Date
[CAPTION]
<TABLE>
Average Annual Average Annual
Class of Shares One-Year Return 5 Year Return Inception to Date
<S> <C> <C> <C>
Common 25.43% 11.21% 13.61%
Investor 24.87% 10.90% 12.25%
</TABLE>
For the period ended December 31, 1998. Past performance of the Fund does not
predict future results. Indexes are used for comparative performances only. All
indexes are not managed, are not available for investment and, unlike all mutual
funds, they do not assess fees.
13
<PAGE>
MANAGER'S DISCUSSION AND ANALYSIS (continued)
Small Cap Growth Fund
For the fifth consecutive year, small cap stocks underperformed large cap
stocks. Overall market activity narrowed tremendously, with the largest of the
large cap stocks showing large gains, while the average small cap stock
performed poorly. In a year marked by extreme volatility, the Small Cap Growth
Fund posted nice double-digit gains in both the first and fourth quarter. These
gains were not enough to offset a down second quarter and a small cap bear
market in the third quarter.
During the year, the Fund benefited from a slightly overweighted position in the
technology sector and an underweighted position in the energy sector. An
underweighted position in the financial sector was a small detriment to the
Fund. In early October, the Fed announced a surprise interest rate cut. This
action helped cause a major psychological shift among investors as they began to
massively purchase Internet stocks. While the Internet has the potential to
significantly alter the economic landscape, most of these companies continue to
lose money. Since the Fund concentrates on investing in profitable companies,
not owning Internet stocks hindered performance during the year.
The Fund expects to maintain its emphasis on holding stocks that have a higher
degree of recurring revenue, superior earnings growth and lower valuations
relative to the Russell 2000 Growth Index. While an environment of low
inflation and low interest rates bode well for U.S. equities, it does appear
that the rate of economic growth is decelerating. Earnings estimates for small
cap growth stocks are being revised downward. However, small caps are very
attractively valued relative to large cap stocks.
COMMON SHARE CLASS
[CHART APPEARS HERE]
Comparison of Change in Value of a $10,000 Investment
ABN AMRO Small Cap Russell Russell 2000 Lipper Small Cap
Growth Fund 2000 Index Growth Index Funds Average Index
1/4/93* 10000 10000 10000 10000
Dec-93 10279 11887 11335 11762
Dec-94 9634 11671 11060 11673
Dec-95 12730 14991 14493 15370
Dec-96 15202 17464 16126 18045
Dec-97 17618 21370 18213 21650
Dec-98 16470 20825 18437 21676
INVESTOR SHARE CLASS
[CHART APPEARS HERE]
Comparison of Change in Value of a $10,000 Investment
ABN AMRO Small Cap Russell Russell 2000 Lipper Small Cap
Growth Fund 2000 Index Growth Index Funds Average Index
3/8/93* 10000 10000 10000 10000
Dec-93 10753 11400 11542 11494
Dec-94 10050 11192 11262 11403
Dec-95 13239 14377 14758 14982
Dec-96 15778 16748 16420 17616
Dec-97 18216 20494 18546 21061
Dec-98 16896 19972 18774 21060
* Inception Date
[CAPTION]
<TABLE>
Average Annual Average Annual
Class of Shares One-Year Return 5 Year Return Inception to Date
<S> <C> <C> <C>
Common -6.52% 9.89% 8.69%
Investor -7.25% 9.46% 9.60%
</TABLE>
For the period ended December 31, 1998. Past performance of the Fund does not
predict future results. Indexes are used for comparative performances only. All
indexes are not managed, are not available for investment and, unlike all mutual
funds, they do not assess fees.
14
<PAGE>
DECEMBER 31, 1998
Real Estate Fund
1998 was a tough year for real estate stocks and a time of reflection for the
industry. The NAREIT Equity Index decreased 17.5% during the year with the
greatest decline in the third quarter. The Morgan Stanley REIT Index had a
negative return of 16.9% for the year. Several factors led to the correction in
this sector including: slowing growth in the sector, concerns of excess
capacity, confusion over legislation which eventually impacted only a handful of
real estate investment trusts ("REIT"s), and poor capital planning. At the
beginning of the year, real estate stocks were at high valuations with P/E
ratios at near record levels and stocks trading at sizable premiums to the
underlying value of the company's real estate holdings. Equity issuance in 1997
had exceeded all prior year records and appeared to be unstoppable, however,
returns on acquisitions and development were decreasing and some property
markets showed signs of overbuilding. Investors remembering the late 1980's were
not anxious to repeat prior mistakes and were hesitant to invest new capital in
this sector. The result was that equity issuance literally stopped in February
and did not resume for the remainder of the year. Companies accustomed to
growing earnings through acquisition and development were faced with a shortage
of capital and had to rethink their strategy. Those sectors and companies that
bore the correction with less damage to their stock price were those: a) whose
management demonstrated innovation and flexibility in setting the course for
their company, b) that had healthy earnings growth from their existing
portfolios, and c) that had a well managed balance sheet.
The Real Estate Fund was not spared the turmoil in this sector. However, the
Fund succeeded in outperforming both the NAREIT Equity Index and the Morgan
Stanley REIT Index during 1998. Our strategy was to invest in property companies
we believed had predictable earnings growth, a well-structured balance sheet and
a solid dividend. During the year, we took advantage of pricing inconsistencies
to boost our stakes in these companies and move out of any stocks that did not
fit our criteria. Concentrations in the retail, industrial and residential
sectors benefited our performance with stocks such as Kimco Realty, CBL &
Associates, Centerpoint Properties, and Duke Realty returning positive total
returns for the year. Limited exposure to the hotel sector, which decreased
nearly 53 percent, was also a determining factor in our results.
We have a positive outlook for 1999. REITs are trading at relatively low
multiples, dividend yields average 7.5% and real estate fundamentals are strong
with new construction levels in check for the most part. These factors should
contribute to price increases in 1999. The major risk for 1999 is the slowing
economy and its impact on the real estate market. In the unlikely scenario of a
recession, demand could fall short of expectations and excess supply could
forestall earnings growth. Another concern for 1999 lies in the amount of equity
issuance. Since REITs were cut out of the equity markets in 1998, many are
starved for capital due to poor planning. If there is a significant amount of
new equity issued without a corresponding increase in demand, returns for the
sector could be capped. This is an unlikely scenario as prices for most REITs
would have to rise a minimum of 10% in order for the company to issue stock at
the same level as their last offering.
If prices do rise to levels that support new equity issuance, all is not lost.
This would trigger positive REIT returns, a welcome respite from 1998.
COMMON SHARE CLASS
Comparison of Change in Value of a $10,000 Investment
[Line graph appears here]
Lipper
ABN AMRO Real Estate NAREIT Morgan Stanley
Real Estate Fund Index Equity Index REIT Index
---------------- ------------ ------------- --------------
12/31/97* 10,000 10,000 10,000 10,000
March 1998 9,892 10,109 9,952 9,927
June 1998 9,516 9,538 9,496 9,491
September 1998 8,728 8,367 8,496 8,489
December 1998 8,720 8,461 8,248 8,304
* Inception Date
Average Annual Average Annual
Class of Shares One-Year Return 5 Year Return Inception to Date
- --------------- --------------- -------------- -----------------
Common -12.35 N/A -12.35%
Investor N/A N/A 7.35%**
For the period ended December 31, 1998. Past performance of the Fund does not
predict future results. Indexes are used for comparative performances only. All
indexes are not managed, are not available for investment and, unlike all mutual
funds, they do not assess fees.
** Not Annualized
15
<PAGE>
MANAGER'S DISCUSSION AND ANALYSIS (continued)
Asian Tigers Fund
Economic recession continued to be the key theme in Asia in 1998 as the region
struggled with poor industrial production, high unemployment, fragile banking
systems, political uncertainty and, for the first time in decades, deflation.
Investor sentiment towards emerging markets reached a low point during the third
quarter as the contagion from the Russian devaluation and Brazil spilled over
into credit markets around the world. The aggressive easing by the Fed in
September coupled with the sharp rebound in the Japanese yen enabled Asian
central banks to lower interest rates without running the risk of further
currency falls. This resulted in a significant recovery in most Asian equity
markets, a number of which ultimately managed to close the year on a respectable
basis. The star performer in Asia in 1998 was Korea which registered an increase
of over 110% in U.S. dollar terms. Thailand and the Philippines also managed to
close the year on a positive note with gains of 26.5% and 8.0%, respectively.
Most other markets recorded declines for the year, albeit at levels far better
than could have been anticipated during the third quarter. Indonesia registered
a drop of 31.5%, Malaysia fell by over 29% and Hong Kong saw a drop of 6%. The
worst performer was Shanghai which closed the year with a fall of over 48%.
The Asian Tigers Fund retained a defensive stance throughout the year with the
key overweights being Hong Kong, India, Singapore and Taiwan. Correspondingly,
Indonesia, Malaysia and Thailand were underweight for most of the year.
Malaysia, in particular, posed significant problems after it was removed from
the Morgan Stanley MSCI All Asia Free ex-Japan Index as a result of capital
controls imposed in September. Towards the end of the year, the defensive stance
was relaxed somewhat with a significant increase in weightings in Korea at the
expense of India and Hong Kong. Cash holdings were also reduced in the fourth
quarter as it became clear that lower interest rates would result in a
significant liquidity induced rebound in the equity markets.
The immediate prospects for both the Asian markets and economies appear
uncertain. The scale of the rebound has been surprising and the markets now seem
to be discounting the good news. However, while economies are expected to
stabilize in the second half of 1999, there are no clear signs of a sustainable
recovery given the myriad of problems such as, fragile banking systems, higher
domestic unemployment and excess production capacity. There are also numerous
external threats which may imperil economic recovery. These range from
persistent problems in Japan, a slowing Chinese economy, further problems in
Brazil and lower economic growth in the Organization for Economic Cooperation
and Development. As such, markets continue to remain vulnerable to sudden
changes in investor sentiment throughout 1999. In light of these views, added
nimbleness should provide opportunities in the short-term although a shift
towards more defensive markets may be warranted in the second half of the year.
<PAGE>
December 31, 1998
Asian Tigers Fund
(continued)
COMMON SHARE CLASS
Comparison of Change in Value of a $10,000 Investment
[Line graph appears here]
<TABLE>
<CAPTION>
Morgan Stanley Lipper Pacific
ABN AMRO Asian MSCI All Asia Free ex-Japan Funds
Tiger Fund ex-Japan Index Average Index
-------------- ------------------ --------------
<S> <C> <C> <C>
1/3/94* 10,000 10,000 10,000
December 1994 9,497 8,306 8,313
December 1995 10,599 8,638 8,900
December 1996 12,142 9,506 9,904
December 1997 7,773 5,674 5,992
December 1998 6,890 5,233 5,396
</TABLE>
* Inception Date
INVESTOR SHARE CLASS
Comparison of Change in Value of a $10,000 Investment
[Line graph appears here]
<TABLE>
<CAPTION>
Morgan Stanley Lipper Pacific
ABN AMRO Asian MSCI All Asia Free ex-Japan Funds
Tiger Fund ex-Japan Index Average Index
-------------- ------------------ --------------
<S> <C> <C> <C>
1/12/94* 10,000 10,000 10,000
December 1994 9,480 8,306 8,313
December 1995 10,540 8,638 8,900
December 1996 12,038 9,506 9,904
December 1997 7,675 5,674 5,992
December 1998 6,763 5,233 5,396
</TABLE>
* Inception Date
<TABLE>
<CAPTION>
Average Annual Average Annual
Class of Shares One-Year Return 5 Year Return Inception to Date
- --------------- --------------- -------------- -----------------
<S> <C> <C> <C>
Common -11.37% N/A -7.19%
Investor -11.89% N/A -7.57%
</TABLE>
For the period ended December 31, 1998. Past performance of the Fund does not
predict future results. Indexes are used for comparative performances only. All
indexes are not managed, are not available for investment and, unlike all mutual
funds, they do not assess fees.
17
<PAGE>
MANAGER'S DISCUSSION AND ANALYSIS (continued)
Latin America
Equity Fund
We can look back at 1998 as a difficult year for the Latin American region. The
equity market as measured by the Morgan Stanley MSCI Emerging Markets Latin
American Free Index dropped by 38%. In aggregate, the region's Gross Domestic
Product ("GDP") growth for 1998 should end with 2.5% and around 8% inflation.
The region's dependence on foreign capital flows made it susceptible to the
contagion effect of the Asian crisis. This loss of confidence caused substantial
outflows from the region. In Brazil, the government was able to privatize the
Telebras system and move forward with its ambitious privatization program. After
Russia devalued however, we witnessed a renewed negative sentiment towards the
region causing over U.S. $20 billion in capital outflows. This spurred a further
loss in confidence in Brazil's ability to tackle its current account and fiscal
account deficits running over 4.0% and 7.5%, respectively. The uncertain
presidential, congressional and governor elections of October did not help
either. The expedient financial support package from the G7 and IMF, and the
favorable outcome of the Brazilian elections reinstated the market's confidence.
The strong degree of confidence was short-lived as it proved difficult to pass
the necessary reforms before year end. In Mexico, GDP should end the year with
an expansion of 4%, despite high real interest rates. Inflation may be higher
than initially expected, at approximately 18%. The low oil prices pushed
Mexico's government to adjust its fiscal budget three times (oil represents 30%
of its total revenue). After much political wrangling, the Mexican government
was able to reach an agreement regarding the depositor's insurance commission,
which should improve Mexico's ailing banking system. Despite the negative
investment sentiment, Argentina's GDP should be around 4.0% with inflation
around 1.0%. Argentina was able to access the international debt markets and is
pushing forward with its privatization program. Chile meanwhile, has had a rough
time because of its large dependency on commodity exports (close to 40% of total
exports) where weak pricing has pushed its current account to below -5%.
However, the country should end up with GDP growth close to 2.5% and inflation
near 5.0%. Both Venezuela and Colombia elected new presidents in 1998. The
outlook for Venezuela remains linked to the development of oil prices (60% of
budget revenue), while the Columbian government seeks a solution to its current
and fiscal account deficits and social situation. Lastly, Peru had a tough year
hurt by the effects of "el Nino", which caused infra-structural damage in the
agricultural and fishing industries.
The Latin American governments should focus their priority towards reducing
current account deficits as well as fiscal deficits, which are imperative tasks
for Brazil. Assuming flat growth in exports and foreign direct investments,
regional GDP growth for 1999 could be close to 1%. Both Brazil and Venezuela may
experience a recession, while we believe Argentina, Chile, Colombia and Mexico
could register GDP growth around 2%. The Brazilian government's ability to push
the necessary set of fiscal reforms, which will help gain investor confidence,
is key to this outlook.
For 1999, we plan to concentrate our stock selection on companies with the best
valuation given their long-term outlook. Their ability to sustain their
operational margins, and the outlook for their businesses are key factors. In
Brazil, we expect to focus on the restructuring plays of the recently privatized
electricity and telecom sector. In Mexico, the consumer sector should receive
attention, while we concentrate on the real estate, telecom, and consumer
sectors in Argentina and Chile. In the Andean Countries, we focus on the most
liquid names with the most attractive valuation. We expect the first half of
1999 to reveal a slowdown in the region's GDP growth, however a gradual
restoration of confidence, driven by a continuation of reforms, could cause
interest rate spreads to narrow. Such an improvement in the debt market's risk
perception for Latin America could enhance a recovery of the equity markets as
we move towards the second half of 1999.
<PAGE>
December 31, 1998
Latin America
Equity Fund (continued)
COMMON SHARE CLASS
Comparison of Change in Value of a $10,000 Investment
[Line graph appears here]
ABN AMRO Morgan Stanley MSCI Lipper Latin America
Latin America Emerging Markets Latin Funds Average
Equity Fund America Free Index Fund Index
-------------- ---------------------- --------------------
7/1/96* 10,000 10,000 10,000
December 1996 10,240 10,397 10,405
December 1997 13,875 13,685 13,165
December 1998 8,835 8,881 8,024
* Inception Date
Average Annual Average Annual
Class of Shares One-Year Return 5 Year Return Inception to Date
- --------------- --------------- -------------- -----------------
Common -36.33 N/A -4.82%
For the period ended December 31, 1998. Past performance of the Fund does not
predict future results. Indexes are used for comparative performances only. All
indexes are not managed, are not available for investment and, unlike all mutual
funds, they do not assess fees.
<PAGE>
MANAGER'S DISCUSSION AND ANALYSIS (continued)
Small Cap Value Fund
The Small Cap Value Fund was launched on June 30, 1998, just prior to a period
of high volatility in world financial markets. Small cap stocks fell sharply
through October 8, then rebounded. From June 30-December 31, 1998, the Russell
2000 Value Index, the Fund's benchmark, was down 10.4%. The Fund declined by
12.8%.
U.S. equity investors in 1998 continued to demonstrate a preference for very
large stocks. The large cap S&P 500 outperformed the small cap Russell 2000
Index by 30 percentage points, by far its largest outperformance in the Russell
2000's 20-year history. In turbulent financial markets, investors sought safety
in size. The S&P 500 has beaten the Russell 2000 for an unprecedented five
consecutive years. This has left small cap stocks at their lowest valuation
levels, relative to large cap stocks, in 20 years.
We believe the stage has been set for a powerful small cap rally. After small
cap stocks' relative valuations reached low levels in 1978 and 1990, the stocks
staged strong rallies. In the late 1980s, small caps badly lagged larger stocks.
However, from 1991-93, the Russell 2000 rose 25% a year, versus 12% a year for
the S&P 500.
The Fund's underperformance in 1998 was the result of a poor third quarter. The
Fund was hurt by underweighting utilities, which remained steady during market
turmoil; the poor performance of small financial stocks; and some individual
stocks whose profits did not meet expectations. Industry conditions imposed
difficulties on some of the Fund's holdings which in turn hurt profits. For
example, constantly declining oil prices decreased demand for Veritas DGC's
seismic surveys, and Medicare changes reduced payments to nursing home operator
Sun Healthcare.
We believe there are many attractively valued small cap stocks which have the
potential for strong growth. The Fund plans to continue to purchase undervalued
stocks in industries conducive to expanding sales and profits. We remain
optimistic about companies which sell directly to American consumers, whose
spending keeps growing steadily. With extremely low unemployment, Americans are
enjoying wage and benefit increases and are very confident about their economic
situations. Those factors, plus low interest rates, have led to very high sales
levels of autos and new and existing homes. We expect those trends to continue
and to benefit Fund holdings such as home builders Lennar and Del Webb;
furniture maker Furniture Brands; carpet maker Mohawk Industries; and auto parts
maker Borg-Warner Automotive.
<TABLE>
<CAPTION>
COMMON SHARE CLASS
Comparison of Change in Value of a $10,000 Investment
ABN AMRO Russell Russell
Small Cap 2000 2000
Value Fund Value Index Index
<S> <C> <C> <C>
6/30/98 10,000 10,000 10,000
12/31/98 8,725 8,957 9,288
</TABLE>
<TABLE>
<CAPTION>
INVESTOR SHARE CLASS
Comparison of Change in Value of a $10,000 Investment
ABN AMRO Russell Russell
Small Cap 2000 2000
Value Fund Value Index Index
<S> <C> <C> <C>
6/30/98 10,000 10,000 10,000
12/31/98 8,541 8,957 9,288
</TABLE>
* Inception Date
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------
Average Annual Average Annual
Class of Shares One-Year Return 5 Year Return Inception to Date
- ---------------------------------------------------------------------------
<S> <C> <C> <C>
Common N/A N/A -12.68%
- ---------------------------------------------------------------------------
Investor N/A N/A -14.53%
- ---------------------------------------------------------------------------
</TABLE>
For the period ended December 31, 1998. Past performance of the Fund does not
predict future results. Indexes are used for comparative performances only. All
indexes are not managed, are not available for investment and, unlike all mutual
funds, they do not assess fees.
20
<PAGE>
December 31, 1998
Report of Ernst & Young LLP, Independent Auditors
To the Trustees and Shareholders of ABN AMRO Funds:
We have audited the accompanying statement of assets and liabilities of the
Treasury Money Market Fund, Government Money Market Fund, Money Market Fund,
Tax-Exempt Money Market Fund, Fixed Income Fund, Intermediate Government Fixed
Income Fund, Tax-Exempt Fixed Income Fund, International Fixed Income Fund,
Balanced Fund, Value Fund, Growth Fund, International Equity Fund, Small Cap
Growth Fund, Real Estate Fund, Asian Tigers Fund, Latin America Equity Fund, and
Small Cap Value Fund (the Trust), including the schedules of investments, as of
December 31, 1998, and the related statement of operations, the statement of
changes in net assets, and financial highlights for each of the periods
indicated therein. These financial statements and financial highlights are the
responsibility of the Trust's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
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 and financial highlights. Our procedures included confirmation of
securities owned as of December 31, 1998, by correspondence with the custodians
and brokers or by other appropriate auditing procedures where replies from
brokers were not received. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
Treasury Money Market Fund, Government Money Market Fund, Money Market Fund,
Tax-Exempt Money Market Fund, Fixed Income Fund, Intermediate Government Fixed
Income Fund, Tax-Exempt Fixed Income Fund, International Fixed Income Fund,
Balanced Fund, Value Fund, Growth Fund, International Equity Fund, Small Cap
Growth Fund, Real Estate Fund, Asian Tigers Fund, Latin America Equity Fund, and
Small Cap Value Fund at December 31, 1998, and the results of their operations,
the changes in their net assets and the financial highlights for each of the
periods indicated therein, in conformity with generally accepted accounting
principles.
/s/ Ernst & Young LLP
Boston, Massachusetts
February 12, 1999
21
<PAGE>
Schedule of Investments
Treasury Money Market Fund
Net Other Assets & Liabilities - (0.1)%
[Pie chart appears here]
Repurchase Agreements 47.9%
U.S. Treasury Obligations 52.2%
% of Total Net Assets
<TABLE>
<CAPTION>
Face Market
Description Amount (000) Value (000)
================================================================================
<S> <C> <C>
U.S. TREASURY OBLIGATIONS - 52.2%
U.S. Treasury Bills (A)
3.914%, 01/14/99 $10,000 $ 9,986
4.475%, 01/21/99 50,000 49,877
4.410%, 02/25/99 10,000 9,934
4.821%, 03/11/99 10,000 9,909
4.552%, 04/01/99 30,000 29,663
U.S. Treasury Notes
6.375%, 01/15/99 10,000 10,009
6.250%, 03/31/99 10,000 10,018
7.000%, 04/15/99 7,000 7,030
6.375%, 04/30/99 15,000 15,087
6.500%, 04/30/99 14,000 14,047
6.000%, 06/30/99 15,000 15,105
--------
Total U.S. Treasury Obligations
(Cost $180,665) 180,665
--------
REPURCHASE AGREEMENTS - 47.9%
J.P. Morgan
4.710%, dated 12/31/98, matures 01/04/99,
repurchase price $57,414,151 (collateralized
by U.S. Treasury Instruments, total market
value: $58,532,447) $57,384 $ 57,384
Morgan Stanley
4.650%, dated 12/31/98, matures 01/04/99,
repurchase price $15,105,850 (collateralized
by U.S. Treasury Instruments, total market
value: $15,476,890) 15,098 15,098
Prudential Securities
4.800%, dated 12/31/98, matures 01/04/99,
repurchase price $16,885,033 (collateralized
by U.S. Treasury Instruments, total market
value: $17,214,728) 16,876 16,876
Warburg
4.750%, dated 12/31/98, matures 01/04/99,
repurchase price $76,168,546 (collateralized
by U.S. Treasury Instruments, total market
value: $77,757,073) 76,129 76,129
--------
Total Repurchase Agreements
(Cost $165,487) 165,487
--------
Total Investments - 100.1%
(Cost $346,152) 346,152
--------
Net Other Assets and Liabilities - (0.1)% (305)
--------
Total Net Assets - 100.0% $345,847
========
</TABLE>
- ----------------------------------------
(A) Rate noted represents annualized yield at the time of purchase.
The accompanying notes are an integral part of the financial statements.
22
<PAGE>
DECEMBER 31, 1998
Schedule of Investments
Government Money Market Fund
[PIE CHART APPEARS HERE]
Repurchase Agreements and
Net Other Assets and Liabilities -- 30.3%
U.S. Government
Agency Obligations -- 69.7%
% of Total Net Assets
<TABLE>
<CAPTION>
Face Market
Description Amount (000) Value (000)
============================================================================
<S> <C> <C>
U.S. GOVERNMENT AGENCY OBLIGATIONS - 69.7%
Fannie Mae
5.580%, 01/15/99........................ $ 5,000 $ 5,000
5.380%, 02/09/99........................ 2,865 2,865
5.410%, 02/23/99........................ 3,000 2,999
Fannie Mae Discount Note(A)
4.838%, 01/25/99........................ 15,000 14,952
5.069%, 02/04/99........................ 20,000 19,906
5.080%, 03/01/99........................ 15,000 14,877
5.059%, 03/15/99........................ 20,000 19,798
5.059%, 03/18/99........................ 9,445 9,346
Fannie Mae MTN
5.450%, 04/15/99........................ 6,030 6,027
5.630%, 05/05/99........................ 4,000 3,999
5.625%, 05/06/99........................ 1,900 1,899
5.540%, 07/16/99........................ 5,000 4,998
5.490%, 08/03/99........................ 6,000 5,996
Federal Farm Credit Bank MTN
4.900%, 03/01/99........................ 5,000 5,000
Federal Home Loan Bank
5.555%, 03/16/99........................ 5,000 4,999
5.630%, 04/09/99........................ 4,995 4,994
5.450%, 03/24/99........................ 5,000 4,998
5.500%, 03/26/99........................ 10,000 9,998
5.540%, 07/13/99........................ 5,000 4,999
Federal Home Loan Bank Discount Note(A)
5.095%, 01/08/99........................ 10,000 9,990
5.093%, 01/11/99........................ 10,000 9,986
4.812%, 01/20/99........................ 15,873 15,833
4.897%, 01/27/99........................ 18,000 17,937
5.303%, 03/01/99........................ 5,000 4,957
5.313%, 03/04/99........................ 5,000 4,955
Federal Home Loan Mortgage Corporation
5.600%, 04/21/99........................ 5,000 4,999
Federal Home Loan Mortgage Corporation
Discount Note(A)
5.090%, 01/28/99........................ $15,000 $14,944
5.029%, 02/02/99........................ 16,350 16,278
4.907%, 02/12/99........................ 17,000 16,904
5.009%, 02/17/99........................ 15,000 14,903
5.009%, 02/19/99........................ 10,000 9,933
5.130%, 02/25/99........................ 15,000 14,884
5.090%, 02/26/99........................ 15,000 14,883
4.968%, 03/02/99........................ 5,000 4,959
5.049%, 03/17/99........................ 15,000 14,844
--------
Total U.S. Government Agency Obligations
(Cost $338,839)............................ 338,839
--------
REPURCHASE AGREEMENTS - 30.4%
J.P. Morgan
4.980%, dated 12/31/98, matures
01/04/99, repurchase price
$100,444,785 (collateralized by
U.S. Government Agency
Instruments, total market
value: $102,397,021).................... 100,389 100,389
Prudential Securities
5.100%, dated 12/31/98, matures
01/04/99, repurchase price
$42,415,994 (collateralized by
U.S. Government Agency
Instruments, total market
value: $43,240,915)..................... 42,393 42,393
Prudential Securities
5.100%, dated 12/31/98, matures
01/04/99, repurchase price
$5,134,126 (collateralized by
U.S. Government Agency
Instruments, total market
value: $5,233,963)...................... 5,131 5,131
--------
Total Repurchase Agreements
(Cost $147,913)............................ 147,913
--------
Total Investments - 100.1%
(Cost $486,752)............................ 486,752
--------
Net Other Assets and Liabilities - (0.1)%.... (458)
--------
Total Net Assets - 100.0%.................... $486,294
========
</TABLE>
- --------------------------------------------------------------------------
(A) Rate noted represents annualized yield at the time of purchase.
MTN Medium Term Note
The accompanying notes are an integral part of the financial statements.
23
<PAGE>
Schedule of Investments
Money Market Fund
Repurchase Agreements -- 20.3%
Net Other Assets and Liabilities -- 0.8%
Certificates of Deposit -- 44.7%
Commercial Paper -- 34.2%
% of Total Net Assets
<TABLE>
<CAPTION>
Face Market
Description Amount (000) Value (000)
===============================================================================
<S> <C> <C>
CERTIFICATES OF DEPOSIT - 44.7%
Banks - 44.7%
Bank of Nova Scotia (NY)
5.110%, 01/26/99........................ $20,000 $20,000
5.690%, 03/05/99........................ 10,000 9,999
5.200%, 03/09/99........................ 15,000 15,000
Barclays Bank (NY)
5.700%, 03/30/99........................ 24,000 24,018
Bayerische Landesbank (NY)
5.250%, 02/16/99........................ 15,000 15,000
5.755%, 04/02/99........................ 15,500 15,519
Canadian Imperial Bank of
Commerce (NY)
5.550%, 02/10/99........................ 10,000 9,999
5.635%, 03/02/99........................ 10,000 9,999
5.690%, 03/10/99........................ 10,000 9,999
5.700%, 06/14/99........................ 10,000 9,998
Chase Manhattan Bank
5.120%, 01/27/99........................ 20,000 20,000
5.200%, 02/02/99........................ 22,500 22,500
Commerzbank (NY)
5.370%, 02/24/99........................ 10,000 10,003
5.110%, 03/15/99........................ 20,000 20,000
Credit Suisse First Boston (NY)
5.740%, 01/07/99........................ 8,000 8,000
Deutsche Bank (NY)
5.600%, 02/16/99........................ 10,000 10,000
5.620%, 03/19/99........................ 10,000 9,999
5.700%, 03/30/99........................ 10,000 9,999
First National Bank of Chicago
5.215%, 02/04/99........................ 20,000 20,000
5.520%, 02/16/99........................ 7,000 6,998
First Union National Bank of North Carolina
5.170%, 03/29/99........................ 25,000 25,000
Harris Trust & Savings
5.350%, 01/19/99........................ 20,000 20,000
5.000%, 05/04/99........................ 15,000 15,000
Morgan Guaranty Trust
5.130%, 03/15/99........................ 15,000 14,997
National Westminster Bank (NY)
5.615%, 03/19/99........................ 10,000 9,999
5.700%, 03/30/99........................ 10,000 9,999
Rabobank Nederland (NY)
5.690%, 04/16/99........................ 10,000 9,998
5.740%, 05/19/99........................ 10,000 9,997
5.690%, 06/30/99........................ 10,000 9,997
Societe Generale (NY)
5.560%, 01/19/99........................ 7,000 7,001
5.750%, 04/06/99........................ 15,000 15,016
5.710%, 07/02/99........................ 15,000 15,037
Swiss Bank (NY)
5.525%, 02/10/99........................ 10,000 9,999
5.650%, 03/24/99........................ 10,000 9,999
5.720%, 04/05/99........................ 6,300 6,299
Toronto Dominion Bank (NY)
5.620%, 02/10/99........................ 10,000 10,000
5.700%, 06/15/99........................ 15,000 14,997
5.710%, 06/23/99........................ 13,000 12,998
United Bank of Switzerland (NY)
5.120%, 01/15/99........................ 15,000 15,000
-------
Total Certificates of Deposit
(Cost $518,363)............................ 518,363
-------
COMMERCIAL PAPER(A) - 34.2%
Financial Services - 34.2%
American Express Credit
6.185%, 01/08/99........................ 20,000 19,976
5.069%, 02/12/99........................ 25,000 24,854
Associates of North America
5.160%, 01/14/99........................ 15,000 14,972
5.302%, 02/09/99........................ 15,000 14,915
BankAmerica
5.140%, 02/04/99........................ 15,000 14,928
Centric Capital
5.353%, 01/08/99........................ 12,000 11,988
5.374%, 01/19/99........................ 10,000 9,974
5.323%, 02/03/99........................ 16,600 16,520
Enterprise Funding
5.607%, 01/22/99........................ 10,000 9,968
Ford Motor Credit
5.120%, 01/20/99........................ 30,000 29,920
5.303%, 02/19/99........................ 10,000 9,929
General Electric Capital
5.222%, 02/09/99........................ 25,000 24,861
Household Finance
5.323%, 01/28/99........................ 20,000 19,921
Merrill Lynch & Co.
5.424%, 01/22/99........................ 20,000 19,938
5.282%, 01/26/99........................ 25,000 24,910
Morgan (J.P.) & Co.
5.130%, 01/15/99........................ 15,500 15,469
5.140%, 01/27/99........................ 15,000 14,945
</TABLE>
The accompanying notes are an integral part of the financial statements.
24
<PAGE>
DECEMBER 31, 1998
Schedule of Investments
<TABLE>
<CAPTION>
Face Market
Description Amount (000) Value (000)
===============================================================================
<S> <C> <C>
Financial Services (continued)
Norwest
5.100%, 01/21/99 .......................... $ 20,000 $ 19,944
Quincy Capital
5.374%, 02/10/99 .......................... 10,000 9,941
Receivables Capital
5.293%, 01/25/99 .......................... 10,000 9,965
Republic of New York
5.120%, 03/04/99 .......................... 15,000 14,870
Scripps (E.W.)
5.130%, 02/09/99 .......................... 10,000 9,945
5.201%, 03/16/99 .......................... 15,000 14,841
Wells Fargo
5.303%, 02/25/99 .......................... 20,000 19,840
----------
Total Commercial Paper
(Cost $397,334) ................................. 397,334
----------
REPURCHASE AGREEMENTS - 20.3%
J.P. Morgan
4.960%, dated 12/31/98, matures 01/04/99,
repurchase price $203,854,790
(collateralized by U.S. Government Agency
Instruments, total market value:
$207,817,356) ............................. 203,743 203,743
Prudential Securities
5.100%, dated 12/31/98, matures 01/04/99,
repurchase price $32,301,967
(collateralized by U.S. Government Agency
and Treasury Instruments, total market
value: $32,929,937) ....................... 32,284 32,284
----------
Total Repurchase Agreements
(Cost $236,027) ................................. 236,027
----------
Total Investments - 99.2%
(Cost $1,151,724) ............................... 1,151,724
----------
Net Other Assets and Liabilities - 0.8% 9,147
----------
Total Net Assets - 100.0% ......................... $1,160,871
==========
</TABLE>
- ----------------------------------------
(A) Rate noted represents annualized yield at the time of purchase.
(NY) New York
The accompanying notes are an integral part of the financial statements.
25
<PAGE>
Schedule of Investments
Tax-Exempt Money Market Fund
Net Other Assets and Liabilities -- 0.3%
Repurchase Agreement -- 4.6%
Municipal Bonds -- 95.1%
% of Total Net Assets
<TABLE>
<CAPTION>
Face Market
Description Amount (000) Value (000)
================================================================================
<S> <C> <C>
MUNICIPAL BONDS - 95.1%
Alabama - 2.3%
Columbia County,
Pollution Control RB
Alabama Project, Series C
4.000%, 01/04/99 (1)........................ $ 7,900 $ 7,900
-------
Alaska - 4.4%
Valdez, Industrial Development
Authority, Exxon Pipeline Project
4.050%, 01/04/99 (1)........................ 15,000 15,000
-------
Arizona - 4.2%
Salt River Project
3.000%, 01/28/99............................ 7,000 7,000
3.050%, 02/03/99............................ 1,900 1,900
Tempe Excise Tax RB
4.100%, 01/04/99 (1)........................ 5,300 5,300
-------
14,200
-------
Colorado - 1.5%
Colorado State General Fund TRAN
4.000%, 06/25/99........................... 5,000 5,010
-------
Florida - 9.0%
Florida Municipal Power Agency
3.250%, 01/13/99............................ 6,000 6,000
Jacksonville Electric Authority
3.000%, 02/08/99............................ 9,750 9,750
Miami - Dade County, School District
4.000%, 06/30/99............................ 5,000 5,010
Sunshine State Governmental
Financing Commission TECP
3.000%, 01/12/99...................... 10,000 10,000
-------
30,760
Georgia - 3.8%
Monroe County, Pollution Authority
Control RB, Gulf Power Plant
Project, Series 2
4.000%, 01/04/99 (1)........................ 3,900 3,900
Putnam County Development Authority
Pollution Control RB
4.000%, 01/04/99 (1)........................ 9,100 9,100
-------
13,000
-------
Illinois - 0.9%
Chicago District
4.300%, 09/17/99............................ 3,000 3,015
Illinois State Development Finance
Authority RB
Saint Xavier University Project
4.050%, 01/06/99 (1)........................ 180 180
-------
3,195
-------
Indiana - 1.8%
Sullivan, Pollution Control
Project, TECP, Series L-5
3.250%, 01/21/99............................ 1,100 1,100
Sullivan, Pollution Control
Project, TECP, Series L-4
3.050%, 02/18/99............................ 5,100 5,100
-------
6,200
-------
Kentucky - 3.5%
Jefferson County
3.000%, 02/22/99...................... 8,050 8,050
3.050%, 03/11/99...................... 2,000 2,000
Jefferson County TECP
3.050%, 02/05/99...................... 2,000 2,000
-------
12,050
-------
Louisiana - 4.1%
Jefferson Parish Hospital Service
RB, District #2, FGIC
4.000%, 01/06/99 (1)........................ 5,000 5,000
Louisiana State District Sales Tax
Recovery RB, Series 88, MBIA
4.500%, 07/01/99............................ 9,000 9,038
-------
14,038
-------
Maryland - 3.1%
Maryland State Health & Higher
Education Facilities Agency,
Pooled Loan, Series D
3.750%, 01/06/99 (1)........................ 6,410 6,410
Maryland State Health & Higher
Education Facilities Authority RB
4.150%, 01/06/99 (1)........................ 4,100 4,100
-------
10,510
-------
</TABLE>
The accompanying notes are an integral part of the financial statements.
26
<PAGE>
DECEMBER 31, 1998
Schedule of Investments
<TABLE>
<CAPTION>
Face Market
Description Amount (000) Value (000)
- -------------------------------------------------------------------------------
<S> <C> <C>
Minnesota - 6.0%
Becker, Pollution Control, Northern States
Power Project
3.150%, 01/14/99 ............................ $ 3,000 $ 3,000
3.250%, 01/14/99 ............................ 5,000 5,000
Hennepin County RB, Series C
3.600%, 01/06/99 (1) ........................ 4,000 4,000
Minneapolis RB, Series A
3.600%, 01/06/99 (1) ........................ 1,500 1,500
Minneapolis RB, Series B
3.600%, 01/06/99 (1) ........................ 7,000 7,000
--------
20,500
--------
Mississippi - 3.0%
Jackson County, Ports Facilities RB
4.050%, 01/04/99 (1) ........................ 10,260 10,260
--------
Missouri - 4.5%
Missouri State Health & Education Facilities
Authority RB
4.100%, 01/04/99 (1) ........................ 15,300 15,300
--------
Nebraska - 3.4%
Omaha Public Power District, TECP
3.000%, 01/06/99 ............................ 2,900 2,900
3.250%, 01/06/99 ............................ 1,800 1,800
3.300%, 01/08/99 ............................ 6,800 6,800
--------
11,500
--------
Nevada - 1.8%
Las Vegas Valley, Water District
3.050%, 02/02/99 ............................ 3,000 3,000
3.000%, 02/09/99 ............................ 3,000 3,000
--------
6,000
--------
New Jersey - 1.5%
State of New Jersey
3.200%, 01/20/99 ............................ 5,000 5,000
--------
New York - 6.2%
Long Island Power Authority, Electric
3.150%, 01/13/99 ............................ 3,000 3,000
3.050%, 02/10/99 ............................ 2,000 2,000
3.000%, 03/10/99 ............................ 1,000 1,000
New York, Series B
5.000%, 01/04/99 (1) ........................ 8,025 8,025
New York, Series B-4
4.400%, 01/04/99 (1) ........................ 7,000 7,000
--------
21,025
--------
Ohio - 1.5%
Toledo-Lucas County, CSX Transportation
Project, TECP
3.150%, 01/07/99 ............................ 5,000 5,000
--------
Oklahoma - 1.8%
Muskogee, Industrial Pollution Control RB,
Series A
4.050%, 01/06/99 (1) ........................ 6,000 6,000
--------
South Carolina - 1.9%
Piedmont, Municipal Power Agency RB, Series C,
MBIA
3.850%, 01/06/99 (1) ........................ 6,400 6,400
--------
Texas - 11.2%
Austin, Travis / Williamson
3.450%, 01/22/99 ............................ 4,225 4,225
Austin, Travis, Series A, TECP
3.200%, 01/22/99 ............................ 7,000 7,000
3.000%, 02/04/99 ............................ 3,900 3,900
Board of Regents of the University of Texas,
TECP
3.050%, 02/11/99 ............................ 1,000 1,000
2.950%, 03/02/99 ............................ 2,000 2,000
City of Austin Texas, Utility, Series A, TECP
3.450%, 01/22/99 ............................ 250 250
Harris County, Health Facilities Development
Corp.
4.250%, 02/26/99 (1) ........................ 3,000 3,003
4.200%, 01/04/99 (1) ........................ 10,100 10,100
Texas State Higher Education Authority,
Series B
4.000%, 01/04/99 (1) ........................ 1,645 1,645
Texas State TRAN
4.500%, 08/31/99 ............................ 5,000 5,049
--------
38,172
--------
Virginia - 2.0%
Peninsula Ports Authority Coal Term RB
3.150%, 02/16/99 ............................ 7,000 7,000
--------
Wisconsin - 5.8%
Milwaukee TRAN, Series A
5.000%, 02/25/99 ............................ 5,000 5,011
State of Wisconsin Transportation TECP
3.000%, 01/19/99 ............................ 5,217 5,217
Wisconsin State GO
3.150%, 01/15/99 ............................ 2,170 2,170
Wisconsin State Operating Notes
4.500%, 06/15/99 ............................ 5,000 5,021
Wisconsin Transportation RB Series 1997-A
3.200%, 01/19/99 ............................ 2,242 2,242
--------
19,661
--------
</TABLE>
The accompanying notes are an integral part of the financial statements.
27
<PAGE>
Schedule of Investments
<TABLE>
<CAPTION>
Face Market
Description Amount (000) Value (000)
===============================================================================
<S> <C> <C>
Wyoming - 5.9%
Gillette, Pollution Control RB
3.200%, 01/05/99 ............................ $ 6,300 $ 6,300
Sweetwater County Pollution Control RB,
Series 1998-A
3.000%, 01/11/99 ............................ 7,600 7,600
3.250%, 01/11/99 ............................ 1,000 1,000
Wyoming State General Fund TRAN
4.000%, 06/25/99 ............................ 5,000 5,011
--------
19,911
--------
Total Municipal Bonds
(Cost $323,592) ................................. 323,592
--------
REPURCHASE AGREEMENT - 4.6%
J.P. Morgan
4.950%, dated 12/31/98, matures 01/04/99,
repurchase price $15,525,159 (collateralized
by U.S. Government Agency Instruments, total
market value: $15,826,957) .................... 15,516 15,516
--------
Total Repurchase Agreement
(Cost $15,516) .................................. 15,516
--------
Total Investments - 99.7%
(Cost $339,108) ................................. 339,108
--------
Net Other Assets and Liabilities - 0.3% ........... 1,206
--------
Total Net Assets - 100.0% ......................... $340,314
========
</TABLE>
- ----------------------------------------
(1) Variable rate instrument. The rate reported on the Schedule of Investments
is the rate in effect on December 31, 1998. The maturity date shown is the
next scheduled reset date.
GO General Obligation
RB Revenue Bond
TECP Tax-Exempt Commercial Paper
TRAN Tax & Revenue Anticipation Note
The following organizations have provided underlying credit support for certain
securities as defined in the Schedule of Investments:
FGIC Financial Guaranty Insurance Corporation
MBIA Municipal Bond Insurance Association
The accompanying notes are an integral part of the financial statements.
28
<PAGE>
DECEMBER 31, 1998
Schedule of Investments
Fixed Income Fund
[PIE CHART APPEARS HERE]
<TABLE>
<CAPTION>
% of Total Net Assets
<S> <C>
Repurchase Agreement and Net Other Assets and Liabilities 21%
U.S. Treasury Obligations 26.4%
U.S. Government Agency Obligations 10.6%
U.S. Government Mortgage-Backed Securities 16.4%
Asset Backed Securities 8.7%
Non-U.S. Government Mortgage-Backed Securities 5.6%
Corporate Notes and Bonds 30.2%
</TABLE>
<TABLE>
<CAPTION>
Face Market
Description Amount (000) Value (000)
================================================================================
<S> <C> <C>
U.S. TREASURY OBLIGATIONS - 26.4%
U.S. Treasury Notes
6.000%, 08/15/00.............................. $ 4,500 $ 4,595
6.375%, 09/30/01.............................. 4,000 4,176
5.750%, 08/15/03.............................. 2,200 2,297
7.000%, 07/15/06.............................. 3,000 3,423
6.125%, 08/15/07.............................. 3,500 3,829
U.S. Treasury Bonds
7.250%, 05/15/16.............................. 11,100 13,443
6.000%, 02/15/26.............................. 6,000 6,560
U.S. Treasury Strips
2.930%, 05/15/05.............................. 4,500 3,334
2.537%, 05/15/08.............................. 6,000 3,803
-----------
Total U.S. Treasury Obligations
(Cost $45,062).................................. 45,460
-----------
U.S. GOVERNMENT
AGENCY OBLIGATIONS - 10.6%
Federal Home Loan Mortgage Corporation
5.750%, 07/15/03.............................. 4,700 4,830
7.000%, 04/15/12.............................. 3,900 4,058
Federal National Mortgage Association
5.750%, 04/01/03.............................. 4,000 4,114
6.120%, 03/23/28, MTN......................... 4,965 5,213
-----------
Total U.S. Government Agency Obligations
(Cost $17,700).................................. 18,215
-----------
U.S. GOVERNMENT
MORTGAGE-BACKED SECURITIES - 16.4%
Federal Home Loan Mortgage Corporation
6.500%, 05/01/13
Pool # E00548................................ 3,700 3,756
6.250%, 05/15/20, CMO
Series 2020, Class B......................... 2,600 2,597
6.500%, 02/15/28, CMO
Series 2030, Class PC........................ 2,415 2,406
Federal Home Loan Mortgage Corporation
7.000%, 02/15/28, CMO
Series 2031, Class PG........................ 1,272 1,310
Federal National Mortgage Association
6.000%, 04/01/13
Pool # 425550................................ 4,060 4,072
7.000%, 02/25/20
Series 1993-2
Class PG, REMIC.............................. 2,300 2,316
6.500%, 10/21/21
Series 1993-87
Class H, REMIC............................... 5,220 5,285
6.500%, 10/01/23
Pool # 190249................................ 1,508 1,528
7.000%, 01/18/24
Series 1997-63
Class D, REMIC............................... 4,867 4,978
-----------
Total U.S. Government Mortgage-Backed Securities
(Cost $28,096).................................. 28,248
-----------
NON-U.S. GOVERNMENT
MORTGAGE-BACKED SECURITIES - 5.6%
Residential Accredit Loans
Series 1998-QS9, Class A1, CMO
6.750%, 07/25/28............................. 3,155 3,151
Residential Accredit Loans
Series 1998-QSR, Class A-3, CMO
6.750%, 07/25/28............................. 4,295 4,312
Residential Funding Mortgage
Securities 1, Series 1994-S1,
Class A-7
6.573%, 01/25/24............................. 2,101 2,101
-----------
Total Non-U.S. Government
Mortgage-Backed Securities
(Cost $9,553).................................. 9,564
-----------
ASSET-BACKED SECURITIES - 8.7%
Advanta Equipment Receivables
Series 1998-1, Class A2
5.820%, 12/15/06............................. 2,150 2,164
Advanta Equipment Receivables
Series 1998-1, Class B
6.100%, 12/15/06............................. 3,500 3,540
Asset Securitization
Series 1995-MD4, Class A1
7.100%, 08/13/29............................. 4,900 5,136
Case Equipment Loan Trust
Series 1998-B, Class A3
5.810%, 05/15/03............................. 2,050 2,062
</TABLE>
The accompanying notes are an integral part of the financial statements.
29
<PAGE>
Schedule of Investments
<TABLE>
<CAPTION>
Face Market
Description Amount (000) (Value (000)
- ------------------------------------------------------------------------
<S> <C> <C>
ASSET-BACKED SECURITIES (continued)
CIT Recreational Vehicle Owner Trust
Series 1996-A, Class A
5.400%, 12/15/11....................... $ 1,011 $ 1,012
The Money Store Home Equity Trust
Series 1993-C, Class A-3
5.750%, 10/15/22....................... 1,101 1,107
-------
Total Asset-Backed Securities
(Cost $14,947)............................ 15,021
-------
CORPORATE NOTES AND BONDS - 30.2%
Financial - 11.2%
Associates of North America
6.450%, 10/15/01....................... 6,300 6,458
Ford Motor Credit
5.125%, 10/15/01....................... 5,100 5,068
Goldman Sachs Mortgage
Securities Corp. II,
Series 1998-GLII, Class A2
6.562%, 04/13/31....................... 3,650 3,781
Paine Webber Group
6.550%, 04/15/08....................... 1,740 1,742
Sears Roebuck Acceptance
7.000%, 06/15/07....................... 2,000 2,153
-------
19,202
-------
Industrial - 9.4%
Belo (A.H.), Debenture
7.250%, 09/15/27....................... 4,500 4,641
Chesapeake
7.200%, 03/15/05....................... 5,205 5,595
Owens Corning
7.500%, 05/01/05....................... 3,175 3,274
Protection One Alarm
7.375%, 08/15/05 (A)................... 2,675 2,762
-------
16,272
-------
Technology - 3.0%
Seagate Technology, Senior Note
7.125%, 03/01/04....................... 5,000 5,156
-------
Telecommunications - 3.1%
MCI WorldCom
6.250%, 08/15/03....................... 5,130 5,271
-------
Utilities - 3.5%
Long Island Lighting
8.200%, 03/15/23....................... 2,020 2,225
National Rural Utilities
5.300%, 09/25/03....................... 3,795 3,804
-------
6,029
-------
Total Corporate Notes and Bonds
(Cost $51,014)............................ 51,930
-------
REPURCHASE AGREEMENT - 2.4%
J.P. Morgan
4.950%, dated 12/31/98, matures
01/04/99, repurchase price
$4,252,748 (collateralized by
U.S. Government Agency
Instruments, total market
value: $4,335,418).................... $ 4,250 $ 4,250
-------
Total Repurchase Agreement
(Cost $4,250)............................. 4,250
-------
Total Investments - 100.3%
(Cost $170,622)........................... 172,688
-------
Net Other Assets and Liabilities - (0.3)%.. (499)
-------
Total Net Assets - 100.0%.................. $ 172,189
=======
</TABLE>
________________________________________________
(A) Securities exempt from registration pursuant to Rule 144A under the
Securities Act of 1933, as amended. These securities may be resold, in
transactions exempt from registration, to qualified institutional buyers.
At December 31, 1998, these securities amounted to $2,761,938, or 1.6% of
net assets.
CMO Collateralized Mortgage Obligation
MTN Medium Term Note
REMIC Real Estate Mortgage Investment Conduit
The accompanying notes are an integral part of the financial statements.
30
<PAGE>
DECEMBER 31, 1998
Schedule of Investments
Intermediate Government
Fixed Income Fund
Repurchase Agreement -- 2.2%
Net Other Assets and Liabilities -- 0.2%
U.S. Treasury Obligations -- 37.2%
U.S. Government Agency Obligations -- 30.5%
U.S. Government Mortgage-Backed Securities -- 29.9%
% of Total Net Assets
<TABLE>
<CAPTION>
Face Market
Description Amount (000) Value (000)
===============================================================================
<S> <C> <C>
U.S. GOVERNMENT
AGENCY OBLIGATIONS - 30.5%
Fannie Mae
6.560%, 04/10/00............................. $2,000 $ 2,040
5.750%, 04/15/03............................. 3,000 3,085
Federal Farm Credit Bank
6.710%, 04/25/01, MTN........................ 2,650 2,754
Federal Home Loan Bank
5.820%, 08/07/03............................. 2,500 2,575
5.890%, 08/11/08............................. 2,600 2,704
-------
Total U.S. Government Agency Obligations
(Cost $12,821).................................. 13,158
-------
U.S. GOVERNMENT
MORTGAGE-BACKED SECURITIES - 29.9%
Fannie Mae
7.000%, 01/18/24, CMO
Series 1997-63, Class D...................... 3,356 3,432
Federal Home Loan Mortgage
Corporation, Pass Thru
7.000%, 04/15/12............................. 1,320 1,374
5.900%, 04/25/19
Series 23, Class PG......................... 2,100 2,091
6.750%, 04/15/20
Series 1443, Class F........................ 3,000 3,014
6.250% 05/15/20
Series 2020, Class B........................ 1,500 1,498
6.250% 07/15/23
Series 2020, Class C........................ 1,500 1,496
-------
Total U.S. Government Mortgage-Backed Securities
(Cost $12,891).................................. 12,905
-------
U.S. TREASURY OBLIGATIONS - 37.2%
U.S. Treasury Notes
6.000%, 08/15/00............................. 3,125 3,191
5.750%, 11/30/02............................. 1,250 1,297
5.875%, 11/15/05............................. 3,000 3,204
7.000%, 07/15/06............................. 5,000 5,705
6.125%, 08/15/07............................. 2,400 2,626
-------
Total U.S. Treasury Obligations
(Cost $15,445).................................. 16,023
-------
REPURCHASE AGREEMENT - 2.2%
J.P. Morgan
4.950%, dated 12/31/98, matures
01/04/99, repurchase price
$935,537 (collateralized by
U.S. Government Agency
Instruments, total market
value: $953,724)............................. 935 935
-------
Total Repurchase Agreement
(Cost $935).................................. 935
-------
Total Investments - 99.8%
(Cost $42,092)............................... 43,021
-------
Net Other Assets and Liabilities - 0.2%........... 104
-------
Total Net Assets - 100.0%......................... $43,125
=======
</TABLE>
________________________________________________
MTN Medium Term Note
CMO Collaterized Mortgage Obligation
The accompanying notes are an integral part of the financial statements.
31
<PAGE>
Schedule of Investments
Tax-Exempt Fixed Income Fund
[PIE CHART APPEARS HERE]
<TABLE>
<CAPTION>
% of Total Net Assets
<S> <C>
Net Other Assets and Liabilities 0.6%
Municipal Bonds 95.8%
Investment Company 3.6%
</TABLE>
<TABLE>
<CAPTION>
Face Market
Description Amount (000) Value (000)
- --------------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL BONDS - 95.8%
Arizona - 2.8%
Mesa, Utility System RB
4.900%, 07/01/16....................... $ 1,000 $ 995
--------
Arkansas - 6.1%
Arkansas State Development
Financial Authority,
Wastewater System RB, Series A
5.850%, 12/01/19....................... 1,000 1,053
Jefferson County,
Pollution Control RB
Arkansas Power & Light Co.
Project, AMBAC
6.300%, 06/01/18....................... 1,000 1,110
--------
2,163
--------
California - 2.9%
California State GO
4.750%, 09/01/11....................... 1,000 1,038
--------
Florida - 2.9%
Florida State Board
Outlay GO, Series F
5.500%, 06/01/19....................... 1,000 1,042
--------
Illinois - 6.1%
Chicago, Metropolitan Water
Reclamation District GO
5.500%, 12/01/12....................... 1,000 1,090
Cook County, Capital Improvement
GO, FGIC
5.750%, 11/15/12....................... 1,000 1,092
--------
2,182
--------
Indiana - 2.8%
Indianapolis Local Public Improvement
Bond Bank, RB, Series A
5.000%, 02/01/16....................... 1,000 1,014
--------
Maryland - 2.9%
Washington Suburban Sanitary
District GO
5.000%, 06/01/13....................... 1,000 1,039
--------
Massachusetts - 2.8%
Massachusetts State GO
Series C
5.000%, 08/01/17....................... 1,000 1,002
--------
Michigan - 2.9%
Hastings School District GO, FGIC
5.625%, 05/01/18....................... 1,000 1,046
--------
Mississippi - 3.1%
Mississippi State Hospital Equipment
& Facilities Authority RB
Baptist Medical
Center Project, MBIA
6.500%, 05/01/10....................... 1,000 1,126
--------
Missouri - 9.8%
Missouri State Health & Educational
Facilities Authority RB, BJC Health
Systems Project, Series A
6.750%, 05/15/10....................... 2,000 2,442
Missouri State University RB
5.500%, 11/10/12....................... 1,000 1,064
--------
3,506
--------
Minnesota - 2.9%
Rochester Health Care Facilities,
Mayo Clinic
5.375%, 11/15/18....................... 1,000 1,037
--------
Nevada - 9.2%
Clark County Refunding & Transit
Improvement RB, MBIA, Class A
6.200%, 06/01/19....................... 2,000 2,233
Nevada State Municipal Bond Bank
GO, Series A
5.500%, 11/01/17....................... 1,000 1,046
--------
3,279
--------
New York - 6.1%
New York State Highway & Bridge
Improvement Fund RB
MBIA, Series A
5.600%, 04/01/10....................... 2,000 2,168
--------
</TABLE>
The accompanying notes are an integral part of the financial statements.
32
<PAGE>
DECEMBER 31, 1998
Schedule of Investments
<TABLE>
<CAPTION>
Face Market
Description Amount (000) Value (000)
===============================================================================
<S> <C> <C>
New Jersey - 2.8%
New Jersey State Transportation Trust Fund RB,
Series A
5.000%, 06/15/15 ............................ $ 1,000 $ 1,019
--------
Ohio - 2.9%
Mentor, GO
5.250%, 12/01/17 ............................ 1,000 1,024
--------
Oklahoma - 3.0%
Tulsa, Industrial Authority RB, St. John's
Medical Center Project
6.250%, 02/15/17 ............................ 1,000 1,075
--------
Pennsylvania - 2.8%
Pennsylvania State Turnpike Common Oil
Franchise RB, Series B, AMBAC
5.000%, 12/01/18 ............................ 1,000 995
--------
Tennessee - 6.2%
Knox County Tennessee Public Improvement GO
5.250%, 04/01/14 ............................ 1,060 1,100
Shelby County School District GO, Series A
5.850%, 06/01/17 ............................ 1,000 1,111
--------
2,211
--------
Texas - 9.0%
Arlington, GO
5.750%, 08/15/14 ............................ 1,000 1,085
San Antonio, Electric & Gas Utilities RB, MBIA
5.375%, 02/01/18 ............................ 1,000 1,024
Victoria County, Hospital RB, AMBAC
6.250%, 01/01/16 ............................ 1,000 1,094
--------
3,203
--------
Washington - 3.0%
Washington State Public Power Supply System
RB, Nuclear Project #1, Series C, AMBAC
5.500%, 07/01/10 ............................ 1,000 1,081
--------
Wisconsin - 2.8%
Wisconsin State Transportation RB, Series B,
FGIC
5.000%, 07/01/16 ............................ 1,000 1,000
--------
Total Municipal Bonds
(Cost $32,123) .................................. 34,245
--------
INVESTMENT COMPANY - 3.6%
Provident Mutual Money Market ................... 1,276 1,276
--------
Total Investment Company
(Cost $1,276) ................................... 1,276
--------
Total Investments - 99.4%
(Cost $33,399) .................................. 35,521
--------
Net Other Assets and Liabilities - 0.6% 202
--------
Total Net Assets - 100.0% ......................... $ 35,723
========
</TABLE>
- ----------------------------------------
GO General Obligation
RB Revenue Bond
The following organizations have provided underlying credit support for certain
securities as defined in the Schedule of Investments:
AMBAC American Municipal Bond Assurance Corporation
FGIC Financial Guaranty Insurance Corporation
MBIA Municipal Bond Insurance Association
The accompanying notes are an integral part of the financial statements.
33
<PAGE>
Schedule of Investments
International Fixed Income Fund
Australia -- 3.1%
Austria -- 4.2%
Belgium -- 4.5%
Canada -- 8.0%
Denmark -- 8.6%
Finland -- 4.1%
France -- 8.3%
Germany -- 7.1%
Japan -- 10.2%
Netherlands -- 7.6%
Spain -- 2.4%
Supernational -- 12.6%
Sweden -- 7.1%
United States -- 7.5%
Net Other Assets and Liabilities -- 4.7%
% of Total Net Assets
<TABLE>
<CAPTION>
Face Market
Description Amount (000)(1) Value (000)
===============================================================================
<S> <C> <C>
FOREIGN BONDS - 95.3%
Australia - 3.1%
R&I Bank of Western Australia
7.250%, 09/29/03......................... 400 $ 262
Treasury Corp. Victoria
8.250%, 10/15/03......................... 400 275
------
537
------
Austria - 4.2%
Republic of Austria
4.500%, 09/28/05......................... JPY 70,000 736
------
Belgium - 4.5%
Kingdom of Belgium
9.000%, 03/25/03......................... 22,500 791
------
Canada - 8.0%
Canadian Government
8.750%, 12/01/05......................... 1,000 800
8.000%, 06/01/27......................... 650 596
------
1,396
------
Denmark - 8.6%
Kingdom of Denmark
7.000%, 12/15/04......................... 5,000 906
7.000%, 11/10/24......................... 3,000 603
------
1,509
------
Finland - 4.1%
Republic of Finland
8.250%, 06/25/02......................... DEM 1,050 727
------
France - 8.3%
Government of France
5.250%, 04/25/08......................... ECU 500 648
5.250%, 04/25/08......................... 1,950 386
8.500%, 04/25/23......................... 1,500 415
------
1,449
------
Germany - 7.1%
Bundesrepublic Deutschland
8.375%, 05/21/01......................... 1,000 670
Deutsche Finance BV
6.000%, 01/12/04......................... NLG 1,000 581
------
1,251
------
Japan - 10.2%
Export-Import Bank of Japan
2.875%, 07/28/05......................... 90,000 850
Japanese Government
3.000%, 09/20/05......................... 50,000 481
2.300%, 09/20/18......................... 55,000 450
------
1,781
------
Netherlands - 7.6%
International Nederland Bank
6.000%, 10/01/07......................... 1,000 586
Kingdom of Netherlands
8.250%, 06/15/02......................... 700 430
7.500%, Principal Strip (A)
01/15/23................................. 2,000 317
------
1,333
------
Spain - 2.4%
Kingdom of Spain
6.150%, 01/31/13......................... 50 415
------
Supernational - 12.6%
European Investment Bank
8.000%, 06/10/03......................... GBP 700 1,291
6.000%, 01/24/06......................... NLG 1,000 598
World Bank
2.000%, 02/18/08......................... JPY 37,000 329
------
2,218
------
Sweden - 7.1%
Kingdom of Sweden
13.000%, 06/15/01........................ 2,500 375
6.000%, 02/09/05......................... 6,400 873
------
1,248
------
</TABLE>
The accompanying notes are an integral part of the financial statements.
34
<PAGE>
DECEMBER 31, 1998
Schedule of Investments
<TABLE>
<CAPTION>
Face Market
Description Amount (000)(1) Value (000)
=================================================================================
<S> <C> <C>
United States - 7.5%
Phillip Morris Finance Euro
5.625%, 06/24/08 ............................ DEM 1,000 $ 632
Tennessee Valley Authority
6.375%, 09/18/06 ............................ DEM 1,000 689
--------
1,321
--------
Total Foreign Bonds
(Cost $15,484) .................................. 16,712
--------
Total Investments - 95.3%
(Cost $15,484) .................................. 16,712
--------
Net Other Assets and Liabilities - 4.7%............ 823
--------
Total Net Assets - 100.0% ......................... $ 17,535
========
</TABLE>
- ----------------------------------------
(1) In local currency unless otherwise noted.
(A) Zero coupon bond. Rate reflects effective yield to maturity.
DEM Deutche Mark
ECU European Currency Units
GBP Great Britain Pounds
JPY Japanese Yen
NLG Netherland Guilders
As of December 31, 1998, the Fund had entered into the following forward foreign
currency exchange contracts:
<TABLE>
<CAPTION>
Net Unrealized
Settlement Appreciation
Contracts to Deliver In Exchange For Date (Depreciation)(000)
- ----------------------------- ----------------------- ---------- -------------------
<S> <C> <C> <C>
Australian Dollars 500,000 U.S. Dollars 317,413 03/26/99 $ 11
Canadian Dollars 1,000,000 U.S. Dollars 643,959 02/10/99 (9)
U.S. Dollars 1,393,958 Deutche Mark 2,321,675 02/10/99 2
-----
$ 4
=====
</TABLE>
Investment Catergories as a percentage of Total Net Assets.
<TABLE>
<S> <C>
Government National 60.6%
Banks 22.3
Financial 6.9
Government Agencies 5.5
Net Other Assets and Liabilities 4.7
------
100.0%
======
</TABLE>
The accompanying notes are an integral part of the financial statements.
35
<PAGE>
Schedule of Investments
Balanced Fund
[PIE CHART APPEARS HERE]
<TABLE>
<CAPTION>
% of Total Net Assets
<S> <C>
Repurchase Agreements & Net Other Assets & Liabilities 3.0%
U.S. Treasury Obligations 5.8%
U.S. Government Agency Obligations 4.0%
U.S. Government Mortgage-Backed Securities 4.9%
Domestic Common Stocks 58.1%
Foreign Common Stocks 12.4%
Non-U.S. Government Mortgage-Backed Securities 1.2%
Corporate Notes and Bonds 8.3%
Asset-Backed Securities 2.3%
</TABLE>
<TABLE>
<CAPTION>
Market
Description Shares Value (000)
- --------------------------------------------------------------------------------
<S> <C> <C>
DOMESTIC COMMON STOCKS - 58.1%
Basic Materials - 1.9%
Dow Chemical................................ 3,600 $ 327
E.I. duPont de Nemours...................... 8,500 451
Lilly Industries, Class A................... 3,600 72
Mead........................................ 9,500 278
Phelps Dodge................................ 5,230 266
Southdown................................... 1,360 81
----------
1,475
----------
Capital Goods - 4.2%
Allied Signal............................... 3,500 155
Avery Dennison.............................. 6,800 306
Borg-Warner Automotive...................... 2,900 162
Caterpillar................................. 8,190 377
Esterline Technologies*..................... 3,500 76
Fibermark*.................................. 5,890 80
General Electric............................ 13,800 1,408
Kuhlman..................................... 2,300 87
Minnesota Mining & Manufacturing............ 5,200 370
Modern Controls............................. 11,400 66
Timken...................................... 15,500 293
----------
3,380
----------
Communication Services - 4.0%
AirTouch Communications*.................... 4,700 339
Ameritech................................... 9,800 621
AT&T........................................ 9,700 730
Bell Atlantic............................... 8,900 472
GTE......................................... 8,600 559
US West..................................... 6,600 426
----------
3,147
----------
Consumer Cyclicals - 7.1%
Advo Systems*............................... 3,600 95
American Greetings, Class A................. 8,860 364
Budget Group, Class A*...................... 6,900 110
Cendant*.................................... 11,300 215
Dayton-Hudson............................... 7,740 420
Ford Motor.................................. 10,500 616
Furniture Brands International.............. 2,700 74
Gerber Childrenswear........................ 4,750 41
Home Depot.................................. 8,700 532
Interpublic Group........................... 2,900 231
Lennar...................................... 2,100 53
Lone Star Industries........................ 5,000 184
Mattel...................................... 5,900 135
McGraw-Hill................................. 3,300 336
Mohawk Industries*.......................... 3,900 164
National Processing*........................ 7,800 43
Pillowtex................................... 2,900 78
Service International....................... 7,600 289
USG*........................................ 5,700 290
U.S. Home*.................................. 3,400 113
V.F......................................... 8,700 408
Wal Mart Stores............................. 9,500 774
Webb (Del E.)............................... 2,810 77
----------
5,642
----------
Consumer Staples - 7.1%
Albertson's................................. 2,300 147
Avon Products............................... 8,000 354
Coca-Cola................................... 10,500 702
Colgate-Palmolive........................... 4,500 418
ConAgra..................................... 7,100 224
Deluxe...................................... 7,700 282
General Nutrition*.......................... 2,600 42
Gillette.................................... 9,400 454
McDonald's.................................. 2,900 222
Merrill..................................... 5,800 112
Newell...................................... 6,500 268
Philip Morris............................... 9,200 492
Procter & Gamble............................ 8,200 749
Sara Lee.................................... 13,600 383
Supervalu................................... 10,550 295
Walt Disney................................. 18,100 543
----------
5,687
----------
Energy - 2.7%
Exxon....................................... 10,800 790
Halliburton................................. 1,900 56
Mobil....................................... 8,240 718
Newfield Exploration*....................... 3,200 67
Phillips Petroleum.......................... 8,000 341
Texaco...................................... 2,300 122
Veritas DGC*................................ 4,100 53
----------
2,147
----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
36
<PAGE>
December 31, 1998
<TABLE>
<CAPTION>
Schedule of Investments
Market
Description Shares Value (000)
- ------------------------------------------------------------------------------
<S> <C> <C>
Financial - 12.2%
Allstate..................................... 5,200 $ 201
American Express............................. 3,100 317
American International Group................. 2,850 275
Associated Banc-Corp......................... 1,200 41
Astoria Financial............................ 5,400 247
BankAmerica.................................. 12,260 737
Bear Stearns................................. 8,300 310
Chase Manhattan.............................. 9,400 640
Cigna........................................ 5,900 456
CitiGroup.................................... 18,000 891
Commonwealth Bancorp*........................ 6,100 95
Damen Financial.............................. 4,200 69
Equity Residential Properties Trust.......... 8,510 344
Federal National Mortgage
Association................................. 4,400 326
First Industrial Realty Trust................ 1,300 35
Fleet Financial Group........................ 8,900 398
Fremont General.............................. 13,200 327
Golden State Bancorp*........................ 16,800 279
Goldens State Bancorp WTS* (A)............... 15,736 72
GreenPoint Financial......................... 6,900 242
Hartford Financial Services Group............ 7,100 390
HUBCO........................................ 3,000 90
Imperial Credit Commercial................... 5,100 48
Independence Community Bank.................. 5,400 86
KeyCorp...................................... 5,300 170
Liberty Financial............................ 1,900 51
Merrill Lynch................................ 4,500 300
PBOC Holdings*............................... 12,600 129
Peoples Bancorp*............................. 13,800 150
Peoples Bancshares........................... 3,700 76
Peoples Bank Bridgeport...................... 930 26
Peoples Heritage Financial Group............. 4,600 92
Prosperity Bancshares*....................... 2,100 26
Reliance Bancorp............................. 3,900 108
Southbanc Shares............................. 4,800 89
Starwood Hotels & Resorts.................... 11,900 270
Staten Island Bancorp........................ 6,300 126
SunAmerica................................... 4,200 341
UCBH Holdings (C)............................ 36,735 487
US Bancorp (PA).............................. 2,940 58
UST.......................................... 3,520 83
Webster Financial............................ 1,900 52
WSFS Finanacial.............................. 8,300 140
-----------
9,690
-----------
Health Care - 6.1%
Abbott Labs.................................. 9,100 446
American Home Products....................... 9,200 518
Amgen*....................................... 2,200 230
Bristol-Myers Squibb......................... 4,800 642
Eli Lilly.................................... 4,600 409
Healthsouth*................................. 7,500 116
Johnson & Johnson............................ 7,300 612
Medtronic.................................... 3,800 282
Oec Medical Systems*......................... 6,400 201
Pfizer....................................... 6,000 753
Quorum Health Group*......................... 5,400 70
Schering-Plough.............................. 8,800 486
Sun Healthcare Group*........................ 10,200 67
-----------
4,832
-----------
Technology - 9.8%
Automatic Data Processing.................... 4,600 369
Cisco Systems*............................... 7,500 696
Comdisco..................................... 14,600 246
Eastman Kodak................................ 5,000 360
EMC*......................................... 2,100 179
Harris....................................... 10,500 385
Hewlett Packard.............................. 8,900 608
Hyperion Solutions*.......................... 2,070 37
Intel........................................ 7,100 842
International Business Machines.............. 4,000 739
Kronos*...................................... 1,200 53
Lucent Technologies.......................... 6,800 748
Microsoft*................................... 10,500 1,456
National Data................................ 3,600 175
Pioneer-Standard Electronics................. 11,700 110
Pitney Bowes................................. 1,100 73
Texas Instruments............................ 5,100 436
Xerox........................................ 2,500 295
-----------
7,807
-----------
Transportation - 1.2%
CNF Transportation........................... 7,580 285
Covenant Transport, Class A*................. 6,500 116
UAL*......................................... 5,390 322
US Freightways............................... 6,800 198
-----------
921
-----------
Utilities - 1.8%
Baltimore Gas & Electric..................... 11,800 364
E'Town....................................... 1,000 47
Columbia Energy Group........................ 6,400 370
Public Service Company
of New Mexco................................ 5,800 119
Southern..................................... 7,300 212
Utilicorp United............................. 9,000 330
-----------
1,442
-----------
Total Domestic Common Stocks
(Cost $37,797)................................ 46,170
-----------
FOREIGN COMMON STOCKS - 12.4%
Basic Materials - 1.0%
Akzo Nobel, ADR............................. 5,200 232
Broken Hill Proprietary, ADR................ 11,900 171
Ispat International
(VY reg. shares)*.......................... 2,500 19
Madeco, ADR................................. 8,800 74
Maderas y Sinteticos, ADR................... 7,500 48
Rhone Poulenc, ADR.......................... 4,300 216
</TABLE>....................................... -----------
760
-----------
The accompanying notes are an integral part of the financial statements.
37
<PAGE>
Schedule of Investments
<TABLE>
<CAPTION>
Shares/Face Market
Description Amount (000) Value (000)
- --------------------------------------------------------------------------------
<S> <C> <C>
Capital Goods - 0.8%
ABB, ADR ....................................... 18,000 $ 198
Empresas ICA, ADR* ............................. 7,100 32
Hitachi, ADR ................................... 4,500 272
Kyocera, ADR ................................... 2,200 114
--------
616
--------
Communication Services - 1.1%
Cable & Wireless, ADR .......................... 6,100 224
Grupo Televisa, GDR* ........................... 5,300 131
Telefonica de Espana, ADR ...................... 2,652 359
Telefonos de Mexico, ADR ....................... 3,700 180
--------
894
--------
Consumer Cyclicals - 1.3%
DaimlerChrysler AG* ............................ 2,814 270
Matsushita Electric Industrial, ADR ............ 1,900 332
Newscorp, ADR .................................. 9,600 254
Sony, ADR ...................................... 2,800 201
--------
1,057
--------
Consumer Staples - 2.0%
Bass, ADR ...................................... 13,191 190
Buenos Aires Embotellado, ADR* (B) ............. 4,500 --
Buenos Aires Embotellado, RTS* (B) ............. 220,500 --
Cadbury Schweppes, ADR ......................... 4,800 332
Koninklijke Ahold, ADR ......................... 8,400 311
Nestle, ADR .................................... 3,500 382
Unilever, ADR .................................. 4,300 357
--------
1,572
--------
Energy - 1.9%
Elf Aquitane, ADR* ............................. 4,600 260
Norsk Hydro ASA, ADR ........................... 3,700 127
Repsol, ADR .................................... 5,000 273
Royal Dutch Petroleum, ADR ..................... 8,800 421
Schlumberger ................................... 4,600 212
YPF, ADR ....................................... 8,400 235
--------
1,528
--------
Financial - 1.2%
Aegon, ADR ..................................... 4,000 489
Dresdner Bank, ADR ............................. 5,700 238
National Australia Bank, ADR ................... 3,000 223
--------
950
--------
Health Care - 1.2%
Novartis, ADR .................................. 4,159 410
Novo-Nordisk, ADR .............................. 2,900 193
Roche Holdings, ADR ............................ 2,700 330
--------
933
--------
Technology - 1.4%
Alcatel Alsthom CGE, ADR ....................... 7,300 178
Canon, ADR ..................................... 9,500 204
Ericsson Telecommunications, ADR ............... 11,200 268
Fuji Photo Film, ADR ........................... 6,000 220
Northern Telecom ............................... 4,500 226
--------
1,096
--------
Transportation - 0.4%
Canadian Pacific ............................... 8,900 168
KLM Royal Dutch Airlines ....................... 5,700 171
--------
339
--------
Utilities - 0.1%
Enersis, ADR ................................... 4,400 114
--------
Total Foreign Common Stocks
(Cost $6,474) .................................... 9,859
--------
U.S. TREASURY OBLIGATIONS - 5.8%
U.S. Treasury Notes
6.000%, 08/15/00 ............................... $ 1,295 1,322
6.125%, 08/15/07 ............................... 400 438
U.S. Treasury Bonds
7.250%, 05/15/16 ............................... 1,585 1,920
6.000%, 02/15/26 ............................... 600 656
U.S. Treasury Strips
2.537%, 05/15/08 ............................... 450 285
--------
Total U.S. Treasury Obligations
(Cost $4,618) .................................... 4,621
--------
U.S. GOVERNMENT AGENCY OBLIGATIONS - 4.0%
Federal Home Loan Mortgage Corporation
5.750%, 07/15/03 ............................... $ 710 730
7.000%, 04/15/12 ............................... 540 562
Federal National Mortgage Association
5.750%, 04/01/03 ............................... 1,150 1,183
6.120%, 03/23/28, MTN .......................... 655 688
--------
Total U.S. Government Agency Obligations
(Cost $3,077) .................................... 3,163
--------
U.S. GOVERNMENT
MORTGAGE-BACKED SECURITIES - 4.9%
Federal Home Loan Mortgage Corporation
6.500%, 05/01/13, Pool # E00548 .............. $ 467 474
6.750%, 04/15/20, CMO Series 1443, Class F ... 195 196
6.250%, 05/15/20, CMO Series 2020, Class B ... 400 399
6.500%, 02/15/28, CMO Series 2030, Class PC .. 475 473
7.000%, 02/15/28, CMO Series 2031, Class PG .. 400 412
</TABLE>
The accompanying notes are an integral part of the financial statements.
38
<PAGE>
DECEMBER 31, 1998
Schedule of Investments
<TABLE>
<CAPTION>
Face Market
Description Amount (000) Value (000)
- --------------------------------------------------------------------------------
<S> <C> <C>
U.S. GOVERNMENT
MORTGAGE-BACKED SECURITIES (continued)
Federal National Mortgage Association
6.000%, 04/01/13, Pool # 425550
Series 1992-197, Class A.................. $ 564 $ 565
7.000%, 02/25/20, REMIC
Series 1993-2, Class PG................... 300 302
6.500%, 10/21/21, REMIC
Series 1993-87, Class H................... 590 597
7.000%, 01/18/24, REMIC
Series 1997-63, Class D................... 472 483
-----------
Total U.S. Government
Mortgage-Backed Securities
(Cost $3,891)............................... 3,901
-----------
NON-U.S. GOVERNMENT
MORTGAGE-BACKED SECURITIES - 1.2%
Residential Accredit Loans, CMO
6.750%, 07/01/28........................... 600 602
Residential Funding Mortgage Securities
Series 1994-S1, Class A-7, CMO
6.573%, 01/25/24........................... 323 323
-----------
Total Non-U.S. Government
Mortgage-Backed Securities
(Cost $923)................................. 925
-----------
ASSET-BACKED SECURITIES - 2.3%
Advanta Equipment Receivables
Series 1998-1, Class A2
5.820%, 12/15/06............................ 300 302
Advanta Equipment Receivables
Series 1998-1, Class B
6.100%, 12/15/06............................ 438 443
Asset Securitization
Series 1995-MD4, Class A1
7.100%, 08/13/29............................ 400 419
Case Equipment Loan Trust
Series 1998-B, Class A3
5.810%, 05/15/03............................ 300 302
CIT Recreational Vehicle Owner Trust
Series 1996-2, Class A
5.400%, 12/15/11............................ 136 136
The Money Store Home Equity Trust
Series 1993-C, Class A-3
5.750%, 10/15/22............................ 227 228
-----------
Total Asset-Backed Securities
(Cost $1,817)................................ 1,830
-----------
CORPORATE NOTES AND BONDS - 8.3%
Financial - 3.0%
Associates of North America
6.450%, 10/15/01........................... 500 512
Ford Motor Credit
5.125%, 10/15/01........................... 600 596
Goldman Sachs Mortgage
Securities Corp. II
Series 1998-GLII, Class A2
6.562%, 04/13/31........................... 715 741
Paine Webber Group
6.550%, 04/15/08........................... 215 215
Sears Roebuck Acceptance
7.000%, 06/15/07........................... 300 323
-----------
2,387
-----------
Industrial - 2.7%
Belo (A.H.), Debenture
7.250%, 09/15/27........................... 620 639
Chesapeake
7.200%, 03/15/05........................... 700 753
Owens Corning
7.500%, 05/01/05........................... 420 433
Protection One Alarm
7.375%, 08/15/05 (C)....................... 325 336
-----------
2,161
-----------
Utilities - 0.8%
Long Island Lighting
8.200%, 03/15/23........................... 190 209
National Rural Utilities
5.300%, 09/25/03........................... 440 441
-----------
650
-----------
Technology - 0.9%
Seagate Technology, Senior Note
7.125%, 03/01/04........................... 700 722
-----------
Telecommunications - 0.9%
MCI WorldCom
6.250%, 08/15/03........................... 685 704
-----------
Total Corporate Notes and Bonds
(Cost $6,495)................................ 6,624
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
39
<PAGE>
Schedule of Investments
<TABLE>
<CAPTION>
Face Market
Description Amount (000) Value (000)
- --------------------------------------------------------------------------------
<S> <C> <C>
REPURCHASE AGREEMENT - 3.3%
J.P. Morgan
4.950%, dated 12/31/98, matures
01/04/99, repurchase price
$2,630,089 (collateralized by
U.S. Government Agency
Instruments, total market
value: $2,681,217).......................... $ 2,629 $ 2,629
-----------
Total Repurchase Agreement
(Cost $2,629)................................. 2,629
-----------
Total Investments - 100.3%
(Cost $67,721)................................ 79,722
-----------
Net Other Assets and Liabilities - (0.3)% (272)
-----------
Total Net Assets - 100.0%....................... $ 79,450
===========
</TABLE>
________________________________________________
* Non-income producing security
(A) Issuer Golden State Bancorp Litigation Warrants. Expiration
date set upon settlement of litigation.
(B) Less than $500 at market value.
(C) Securities exempt from registration pursuant to Rule 144A
under the Securities Act of 1933, as amended. These securi-
ties may be resold, in transactions exempt from registration,
to qualified institutional buyers. At December 31, 1998,
these securities amounted to $822,302, or 1.0% of net assets.
ADR American Despositary Receipt
CMO Collaterized Mortgage Obligation
GDR Global Depositary Receipt
MTN Medium Term Note
(PA) Pennsylvania
REMIC Real Estate Mortgage Investment Conduit
RTS Rights
WTS Warrants
The accompanying notes are an integral part of the financial statements.
40
<PAGE>
December 31, 1998
Schedule of Investments
Value Fund
[PIE CHART APPEARS HERE]
<TABLE>
<CAPTION>
% of Total Net Assets
<S> <C>
Utilities 5.7%
Transportation 2.8%
Technology 9.4%
Health Care 2.6%
Financial 32.5%
Basic Materials 4.3%
Capital Goods 5.1%
Communications Services 8.3%
Consumer Cyclicals 11.4%
Consumer Staples 6.5%
Energy 9.1%
Repurchase Agreement & Net Other Assets & Liabilities 2.3%
</TABLE>
<TABLE>
<CAPTION>
Market
Description Shares Value (000)
- --------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS - 97.7%
Basic Materials - 4.3%
Dow Chemical................................ 30,400 $ 2,765
Mead........................................ 81,000 2,374
Phelps Dodge................................ 44,300 2,254
----------
7,393
----------
Capital Goods - 5.1%
Caterpillar................................. 68,000 3,128
Minnesota Mining & Manufacturing............ 41,300 2,938
Modern Controls............................. 67,050 386
Timken...................................... 124,100 2,342
----------
8,794
----------
Communication Services - 8.3%
AT&T........................................ 84,100 6,329
GTE......................................... 70,100 4,556
US West..................................... 54,400 3,516
----------
14,401
----------
Consumer Cyclicals - 11.4%
American Greetings, Class A................. 62,600 2,570
Dayton-Hudson............................... 61,000 3,309
Ford Motor.................................. 89,800 5,270
McGraw-Hill................................. 27,200 2,771
USG*........................................ 46,700 2,379
V.F......................................... 70,300 3,295
----------
19,594
----------
Consumer Staples - 6.5%
ConAgra..................................... 67,900 2,139
Deluxe...................................... 62,200 2,274
Supervalu................................... 84,500 2,366
Walt Disney................................. 147,100 4,413
----------
11,192
----------
Energy - 9.1%
Exxon....................................... 86,400 6,318
Halliburton................................. 17,900 530
Mobil....................................... 60,300 5,254
Phillips Petroleum.......................... 57,800 2,464
Texaco...................................... 21,700 1,147
----------
15,713
----------
Financial - 32.5%
Allstate.................................... 50,800 1,962
Astoria Financial........................... 47,300 2,164
BankAmerica................................. 103,400 6,217
Bear Stearns................................ 58,400 2,183
Chase Manhattan............................. 79,800 5,431
Cigna....................................... 44,500 3,440
CitiGroup................................... 149,700 7,410
Equity Residential Properties Trust (A)..... 67,700 2,738
Fleet Financial Group....................... 72,500 3,240
Fremont General............................. 102,400 2,534
Golden State Bancorp*....................... 99,300 1,651
Golden State Bancorp, WTS*(B)............... 82,100 374
GreenPoint Financial........................ 56,100 1,971
Hartford Financial Services Group........... 59,300 3,254
KeyCorp..................................... 51,000 1,632
Merrill Lynch............................... 41,600 2,777
Starwood Hotels & Resorts (A)............... 101,900 2,312
UCBH Holdings (C)........................... 359,930 4,769
----------
56,059
----------
Health Care - 2.6%
American Home Products...................... 80,500 4,533
----------
Technology - 9.4%
Comdisco.................................... 135,200 2,282
Eastman Kodak............................... 40,900 2,945
Harris...................................... 61,900 2,267
Hewlett Packard............................. 74,000 5,055
Texas Instruments........................... 42,500 3,636
----------
16,185
----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
41
<PAGE>
Schedule of Investments
<TABLE>
<CAPTION>
Market
Description Shares Value (000)
- --------------------------------------------------------------------------------
<S> <C> <C>
Transportation - 2.8%
CNF Transportation.......................... 63,600 $ 2,389
UAL*........................................ 40,700 2,429
----------
4,818
----------
Utilities - 5.7%
Baltimore Gas & Electric.................... 80,900 2,498
Columbia Energy Group....................... 47,100 2,720
Southern.................................... 70,050 2,036
UtiliCorp United............................ 72,500 2,660
----------
9,914
----------
Total Common Stocks
(Cost $158,643)............................... 168,596
----------
Face Market
Description Amount (000) Value (000)
- --------------------------------------------------------------------------------
REPURCHASE AGREEMENT - 5.4%
J.P. Morgan
4.950%, dated 12/31/98, matures
01/04/98, repurchase price
$9,371,465 (collateralized by
U.S. Government Agency
Instruments, total market
value: $9,533,641)........................ $ 9,366 $ 9,366
----------
Total Repurchase Agreement
(Cost $9,366)................................. 9,366
----------
Total Investments - 103.1%
(Cost $168,009)............................... 177,962
----------
Net Other Assets and Liabilities - (3.1)% (5,393)
----------
Total Net Assets - 100.0%....................... $ 172,569
==========
</TABLE>
________________________________________________
* Non-income producing security
(A) Real Estate Investment Trust
(B) Issuer Golden State Bancorp Litigation Warrants. Expiration date set upon
settlement of litigation.
(C) Securities exempt from registration pursuant to Rule 144A under the
Securities Act of 1933, as amended. These securities may be resold, in
transactions exempt from registration, to qualified institutional buyers.
At December 31, 1998, these securities amounted to $4,769,073, or 2.8% of
net assets.
WTS Warrants
The accompanying notes are an integral part of the financial statements.
42
<PAGE>
DECEMBER 31, 1998
Schedule of Investments
Growth Fund
[Pie Chart Appears here]
Utilities
0.6%
Transportation
1.7%
Technology
19.9%
Health Care
15.8%
Financial
15.6%
Repurchase Agreement
& Net Other Assets & Liabilities
2.1%
Capital Goods
5.5%
Communications Services
6.1%
Consumer
Cyclicals
17.4%
Consumer
Staples
14.3%
Energy
1.0%
% of Total Net Assets
<TABLE>
<CAPTION>
Market
Description Shares Value (000)
=====================================================================
<S> <C> <C>
COMMON STOCKS - 97.9%
Capital Goods - 5.5%
General Electric.......................... 51,700 $ 5,277
Tyco International........................ 37,700 2,844
Waste Management.......................... 45,300 2,112
-------
10,233
-------
Communication Services - 6.1%
Ameritech................................. 58,000 3,676
BellSouth................................. 69,400 3,461
Century Telephone Enterprises............. 37,550 2,535
MCI WorldCom*............................. 25,500 1,830
-------
11,502
-------
Consumer Cyclicals - 17.4%
Carnival.................................. 106,400 5,107
Cendant*.................................. 127,200 2,425
Dollar General............................ 61,250 1,447
Federated Department Stores*.............. 40,000 1,743
Fred Meyer*............................... 31,400 1,892
Harley Davidson........................... 50,300 2,383
Home Depot................................ 64,800 3,965
Interpublic Group......................... 28,600 2,281
Jones Apparel Group*...................... 39,500 871
Lowe's Companies.......................... 45,300 2,319
Robert Half International*................ 37,600 1,680
Service Corp. International............... 57,200 2,177
Snyder Communications*.................... 47,500 1,603
Staples*.................................. 65,100 2,844
-------
32,737
-------
</TABLE>
<TABLE>
<CAPTION>
Market
Description Shares Value (000)
=====================================================================
<S> <C> <C>
Consumer Staples - 14.3%
Avon Products............................. 52,600 $ 2,328
Cardinal Health........................... 37,800 2,868
Clear Channel
Communications*.......................... 35,400 1,929
Coca-Cola................................. 30,700 2,053
Colgate-Palmolive......................... 26,000 2,415
Gillette.................................. 13,800 667
Newell.................................... 32,700 1,349
Procter & Gamble.......................... 18,100 1,653
Safeway*.................................. 76,800 4,680
Starbucks*................................ 30,200 1,695
Time Warner............................... 35,000 2,172
Wal-Mart Stores........................... 38,600 3,143
-------
26,952
-------
Energy - 1.0%
Mobil..................................... 20,700 1,803
-------
Financial - 15.6%
American International Group.............. 13,200 1,275
Banc One.................................. 62,530 3,193
Bank of New York.......................... 48,800 1,964
BankAmerica............................... 38,100 2,291
CitiGroup................................. 51,100 2,529
Fannie Mae................................ 24,000 1,776
First Union............................... 53,600 3,260
GreenPoint Financial...................... 52,400 1,841
Heller Financial.......................... 105,000 3,084
Morgan Stanley Dean Witter................ 16,300 1,157
SunAmerica................................ 39,200 3,180
Washington Mutual......................... 36,000 1,375
Wells Fargo............................... 62,000 2,476
-------
29,401
-------
Health Care - 15.8%
Abbott Laboratories....................... 61,600 3,018
Bristol-Myers Squibb...................... 24,300 3,252
First Health Group*....................... 26,600 441
Guidant................................... 18,800 2,073
Health Management Associates*............. 89,450 1,934
HEALTHSOUTH*.............................. 141,400 2,183
IMS Health................................ 26,000 1,962
Johnson & Johnson......................... 21,000 1,761
Medtronic................................. 30,600 2,272
Pfizer.................................... 37,600 4,716
Schering-Plough........................... 71,700 3,961
Watson Pharmaceuticals*................... 34,700 2,182
-------
29,755
-------
Technology - 19.9%
Ascend Communications*.................... 31,300 2,058
Cadence Design Systems*................... 74,200 2,207
Cisco Systems*............................ 52,625 4,884
</TABLE>
The accompanying notes are an integral part of the financial statements.
43
<PAGE>
Schedule of Investments
<TABLE>
<CAPTION>
Market
Description Shares Value (000)
====================================================================
<S> <C> <C>
Technology (continued)
EMC*.................................. 35,900 $ 3,052
Galileo International................. 46,700 2,032
HBO................................... 85,900 2,464
Intel................................. 14,800 1,755
International Business Machines....... 5,700 1,053
Microsoft*............................ 36,100 5,007
Network Associates*................... 39,600 2,624
Sterling Commerce*.................... 43,600 1,962
Sun Microsystems*..................... 19,200 1,644
Tellabs*.............................. 17,800 1,220
Texas Instruments..................... 14,300 1,224
Xerox................................. 35,900 4,236
-----------
37,422
-----------
Transportation - 1.7%
ComAir Holdings....................... 40,200 1,357
Southwest Airlines.................... 82,950 1,861
-----------
3,218
-----------
Utilities - 0.6%
AES*.................................. 24,600 1,165
-----------
Total Common Stocks
(Cost $127,853)....................... 184,188
-----------
</TABLE>
<TABLE>
<CAPTION>
Face Market
Description Value (000) Value (000)
====================================================================
<S> <C> <C>
REPURCHASE AGREEMENT - 4.2%
J.P. Morgan
4.950%, dated 12/31/98, matures
01/04/99, repurchase price
$7,821,752 (collateralized by
U.S. Government Agency
Instruments, total market
value: $7,973,802).................... $ 7,817 $ 7,817
-----------
Total Repurchase Agreement
(Cost $7,817)............................ 7,817
-----------
Total Investments - 102.1%
(Cost $135,670).......................... 192,005
-----------
Net Other Assets and Liabilities - (2.1)%.. (3,871)
-----------
Total Net Assets - 100.0%.................. $ 188,134
===========
</TABLE>
________________________________________________________
* Non-income producing security
The accompanying notes are an integral part of the financial statements.
44
<PAGE>
December 31, 1998
Schedule of Investments
International Equity Fund
[PIE CHART APPEARS HERE]
% of Total Net Assets
Capital Goods 4.5%
Commercial Services 2.3%
Technology 6.2%
Health Care 13.9%
Retail 4.8%
Consumer Cyclicals 9.7%
Net Other Assets and Liabilities 1.4%
Financial 22.5%
Consumer Staples 6.0%
Basic Materials 4.8%
Ultilities 15.1%
Energy 8.8%
<TABLE>
<CAPTION>
Market
Description Shares Value (000)
- -------------------------------------------------------------------------------
<S> <C> <C>
FOREIGN COMMON STOCKS - 98.6%
Australia - 3.5%
ANZ Banking Group............................ 187,376 $ 1,226
Brambles Industries.......................... 100,000 2,436
National Mutual Holdings..................... 760,222 1,370
--------
5,032
--------
Finland - 2.0%
Nokia Oyj, Class A........................... 24,000 2,918
--------
France - 14.0%
Alstom*...................................... 47,100 1,104
Axa.......................................... 15,000 2,173
Elf Aquitaine................................ 17,008 1,965
Groupe Danone................................ 7,500 2,146
L'Oreal...................................... 4,800 3,469
Sanofi....................................... 18,078 2,975
SGS-Thompson Microelectronics*............... 30,000 2,361
Total SA, Series B........................... 10,000 1,012
Vivendi...................................... 11,506 2,984
--------
20,189
--------
Germany - 9.3%
Allianz...................................... 7,200 2,640
Bayer........................................ 40,000 1,670
Bayerische Hypo-Und Vereinsbank.............. 20,000 1,566
Deutsche Bank................................ 25,000 1,471
Mannesmann................................... 22,000 2,522
SAP.......................................... 3,500 1,512
Volkswagen................................... 25,000 1,995
--------
13,376
--------
Hong Kong - 1.6%
HSBC Holdings................................ 62,368 1,554
Hutchison Whampoa............................ 110,000 777
--------
2,331
--------
Ireland - 2.4%
Allied Irish Banks........................... 101,180 1,803
CRH.......................................... 100,826 1,710
--------
3,513
--------
Italy - 3.7%
Assicurazioni Generali....................... 43,500 1,815
Telecom Italia............................... 230,000 1,961
Telecom Italia Moblie........................ 200,000 1,476
--------
5,252
--------
Japan - 11.0%
Canon........................................ 90,000 1,923
Ito-Yokado................................... 30,000 2,097
Nippon Telegraph & Telephone................. 222 1,713
Rohm......................................... 17,000 1,548
Orix......................................... 20,000 1,494
Sony......................................... 35,000 2,549
Takeda Chemical Industries................... 60,000 2,310
Toshiba...................................... 360,000 2,144
--------
15,778
--------
Malaysia - 0.5%
Genting...................................... 60,000 110
Malayan Banking.............................. 110,000 188
Sime Darby Malaysia.......................... 180,000 174
Telekom Malaysia............................. 90,000 200
--------
672
--------
Netherlands - 10.4%
Aegon........................................ 21,440 2,632
Akzo Nobel................................... 16,000 728
ASM Lithography Holding*..................... 55,000 1,680
Getronics.................................... 35,000 1,733
Ing Groep.................................... 40,000 2,438
Koninklijke Ahold............................ 70,247 2,595
Phillips Electronics......................... 16,000 1,073
Wolters Kluwer............................... 10,000 2,139
--------
15,018
--------
New Zealand - 1.1%
Telecom Corporation
of New Zealand.............................. 735,802 1,607
--------
Portugal - 2.8%
Jeronimo Martins & Filho..................... 38,997 2,134
Portugal Telecom, Registered................. 40,000 1,835
--------
3,969
--------
Spain - 4.5%
Banco Bilbao Vizcaya......................... 135,000 2,114
Endesa....................................... 75,000 1,984
Telefonica de Espana......................... 51,000 2,264
Telefonica de Espana, RTS*
(expires 2/15/99)............................ 51,000 45
--------
6,407
--------
</TABLE>
The accompanying notes are an integral part of the financial statements.
45
<PAGE>
Schedule of Investments
<TABLE>
<CAPTION>
Market
Description Shares Value (000)
- -----------------------------------------------------------------------------
<S> <C> <C>
Sweden - 3.5%
ABB, Class B............................... 140,000 $ 1,482
Ericsson LM, Class B....................... 80,000 1,900
WM - Data, Class B......................... 40,000 1,704
---------
5,086
---------
Switzerland - 7.7%
Adecco..................................... 3,500 1,601
Nestle, Registered......................... 1,200 2,612
Novartis, Registered....................... 1,103 2,168
Roche Holdings, Class GS................... 200 2,440
Zuerich Versicherungs-
Gesellschaft (F)*......................... 3,000 2,250
---------
11,071
---------
United Kingdom - 20.6%
BAA........................................ 114,880 1,340
BOC Group.................................. 44,734 639
British Petroleum.......................... 132,935 1,984
Cable & Wireless........................... 176,209 2,165
Glaxo Wellcome............................. 75,653 2,601
Lloyds TSB Group........................... 201,963 2,871
Prudential................................. 175,643 2,650
Rentokil Initial........................... 250,000 1,883
Shell Transport & Trading.................. 300,000 1,842
Smithkline Beecham......................... 193,898 2,708
Standard Chartered......................... 226,872 2,627
Unilever................................... 240,000 2,690
Vodafone................................... 100,000 1,623
Zeneca..................................... 45,000 1,958
---------
29,581
---------
Total Foreign Common Stocks
(Cost $97,539)................................ 141,800
---------
Total Investments - 98.6%
(Cost $97,539)................................ 141,800
---------
Net Other Assets and Liabilities - 1.4%......... 2,077
---------
Total Net Assets - 100.0%....................... $ 143,877
=========
</TABLE>
________________________________________________
* Non-income producing security
(F) Foreign Registry Shares
RTS Rights
The accompanying notes are an integral part of the financial statements.
46
<PAGE>
December 31, 1998
Schedule of Investments
SMALL CAP GROWTH FUND
[PIE CHART APPEARS HERE]
<TABLE>
<CAPTION>
<S> <C>
% of Total Net Assets
Basic Materials 3.8%
Capital Goods 10.8%
Communications Services 1.0%
Consumer Cyclicals 24.6%
Consumer Staples 9.8%
Energy 1.2%
Financial 7.6%
Health Care 13.4%
Technology 23.7%
Transportation 3.0%
Repurchase Agreement and
Net Other Assets and Liabilities 1.1%
</TABLE>
<TABLE>
<CAPTION>
Market
Description Shares Value (000)
==========================================================
<S> <C> <C>
COMMON STOCKS - 98.9%
Basic Materials - 3.8%
Cambrex........................... 23,000 $ 552
Citation*......................... 26,000 328
Spartech.......................... 29,550 650
Texas Industries.................. 9,500 256
-------
1,786
-------
Capital Goods - 10.8%
Applied Power..................... 17,400 657
Chart Industries.................. 32,250 246
Lancaster Colony.................. 13,300 427
NCI Building Systems*............. 27,700 779
Technitrol........................ 18,600 593
Teleflex.......................... 15,900 725
Tetra Tech*....................... 36,725 994
Zebra Technologies, Class A*...... 22,200 638
-------
5,059
-------
Communication Services - 1.0%
Transaction Network Service*...... 24,050 483
-------
Consumer Cyclicals - 24.6%
Acxiom*........................... 33,700 1,045
American Management Systems*...... 19,400 776
Catalina Marketing*............... 14,000 957
CCC Information Services Group*... 2,450 42
Daisytek International*........... 21,250 404
DeVry*............................ 18,200 557
Eagle Hardware & Garden*.......... 12,500 406
Gentex*........................... 53,500 1,070
Ha-Lo Industries*................. 23,300 877
Nautica Enterprises*.............. 30,600 459
NFO Worldwide*.................... 20,950 241
Profit Recovery Group
International*.................... 26,150 979
QRS*.............................. 15,500 744
Rental Service*................... 26,000 408
Superior Services*................ 23,150 464
Tarrant Apparel Group*............ 26,400 1,049
Tiffany & Company................. 8,850 459
United Stationers*................ 21,200 551
-------
11,488
-------
Consumer Staples - 9.8%
Casey's General Stores............ 30,500 398
Consolidated Graphics*............ 10,300 696
G & K Services, Class A........... 8,200 437
Helen of Troy*.................... 46,400 682
MSC Industrial Direct, Class A*... 18,800 425
Patterson Dental*................. 22,600 983
Suiza Foods*...................... 9,350 476
Whole Foods Market*............... 9,750 472
-------
4,569
-------
Energy - 1.2%
Atwood Oceanics*.................. 16,900 287
Tuboscope Vetco International*.... 33,800 275
-------
562
-------
Financial - 7.6%
Century Business Services*........ 32,400 466
CMAC Investment................... 6,300 289
Cousins Properties................ 11,800 381
HCC Insurance Holdings............ 24,400 430
Investors Financial Services...... 6,900 411
Lasalle Partners*................. 17,400 512
Sterling Bancshares (Texas)....... 50,800 756
Triad Guaranty*................... 13,000 287
-------
3,532
-------
Health Care - 13.4%
ABR Information Services*......... 34,800 683
American Oncology Resources*...... 39,500 575
Express Scripts, Class A*......... 18,750 1,259
IDEXX Laboratories*............... 20,050 539
KV Pharmaceutical, Class A*....... 11,550 239
PSS World Medical*................ 51,750 1,190
Serologicals*..................... 25,950 779
Universal Health Services,
Class B*.......................... 8,500 441
Veterinary Centers of America*.... 27,800 554
-------
6,259
-------
Technology - 23.7%
Aspen Technology*................. 21,200 307
Avant*............................ 23,150 368
Axent Technologies*............... 24,200 740
Billing Concepts*................. 33,400 367
</TABLE>
The accompanying notes are an integral part of the financial statements.
47
<PAGE>
Schedule of Investments
<TABLE>
<CAPTION>
Market
Description Shares Value (000)
- --------------------------------------------------------------------------------
<S> <C> <C>
Technology (continued)
BISYS Group*...................................... 14,000 $ 723
Cable Design Technologies*........................ 21,500 398
Ciber*............................................ 21,300 595
Documentum*....................................... 7,350 393
HNC Software*..................................... 16,900 683
Hyperion Solutions*............................... 11,300 203
Micros Systems*................................... 21,500 707
National Computer Systems......................... 12,650 468
National Data..................................... 19,000 925
Nova (Georgia)*................................... 13,000 451
PMC-Sierra*....................................... 16,400 1,035
QuadraMed*........................................ 15,550 319
Semtech*.......................................... 15,650 561
Systems & Computer Technology*.................... 14,500 199
Telxon............................................ 18,800 261
Visio*............................................ 27,000 987
Wind River Systems*............................... 8,800 414
-------
11,104
-------
Transportation - 3.0%
Coach USA*........................................ 11,650 404
Expeditors International of Washington............ 24,300 1,021
-------
1,425
-------
Total Common Stocks
(Cost $42,488)....................................... 46,267
-------
</TABLE>
<TABLE>
<CAPTION>
Face Market
Description Amount (000) Value (000)
- -------------------------------------------------------------------------------
<S> <C> <C>
REPURCHASE AGREEMENT - 1.3%
J.P. Morgan
4.950%, dated 12/31/98, matures
01/04/99, repurchase price
$582,084 (collateralized by
U.S. Government Agency
Instruments, total market
value: $593,400)............................ $ 582 $ 582
-------
Total Repurchase Agreement
(Cost $582).................................... 582
-------
Total Investments - 100.2%
(Cost $43,070)................................. 46,849
-------
Net Other Assets and Liabilities - (0.2)%........ (76)
-------
Total Net Assets - 100.0%........................ $46,773
=======
</TABLE>
____________________________________________________________________
* Non-income producing security
The accompanying notes are an integral part of the financial statements.
48
<PAGE>
DECEMBER 31, 1998
Schedule of Investments
Real Estate Fund
[PIE CHART APPEARS HERE]
<TABLE>
<CAPTION>
% of Total Net Assets
<S> <C>
Net Other Assets and Liabilities 0.3%
Repurchase Agreement 5.7%
Storage 2.0%
Retail 23.6%
Residential 18.5%
Diversified 4.0%
Healthcare Properties 0.4%
Hotels 3.3%
Industrial 13.1%
Land 2.1%
Office Properties 27.0%
</TABLE>
<TABLE>
<CAPTION>
Market
Description Shares Value (000)
- --------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS - 94.0%
Diversified - 4.0%
Colonial Properties Trust................. 7,500 $ 200
Pacific Gulf Properties................... 3,600 72
Reckson Service Industries................ 1,440 6
Vornado Operating*........................ 430 3
---------
281
---------
Healthcare Properties - 0.4%
Nationwide Health Properties.............. 1,200 26
---------
Hotels - 3.3%
Starwood Hotels & Resorts................. 10,100 229
---------
Industrial - 13.1%
Centerpoint Properties.................... 8,100 274
Duke Realty Investments................... 12,700 295
Liberty Property Trust.................... 4,000 99
Prologis Trust............................ 7,500 156
Weeks..................................... 3,500 99
---------
923
---------
Land - 2.1%
Catellus Development*..................... 10,600 152
---------
Office Properties - 27.0%
Alexandria Real Estate.................... 4,500 139
Arden Realty.............................. 4,900 114
Boston Properties......................... 8,000 244
Crescent Real Estate Equities............. 3,800 87
Equity Office Properties Trust............ 14,200 341
Highwoods Properties...................... 5,200 134
Parkway Properties........................ 5,600 175
Reckson Associates Realty................. 8,500 189
Spieker Properties........................ 6,300 218
Trizec Hahn............................... 12,800 262
---------
1,903
---------
Residential - 18.5%
Archstone Communities Trust............... 8,500 172
Avalon Bay Communities.................... 8,064 276
BRE Properties, Class A................... 7,600 188
Equity Residential Properties Trust....... 8,700 352
Manufactured Home Communities............. 6,900 173
Post Properties........................... 3,700 142
---------
1,303
---------
Retail - 23.6%
CBL & Associates Properties............... 2,800 72
Chelsea GCA Realty........................ 1,200 43
Developers Diversified Realty............. 9,500 169
Federal Realty Investment Trust........... 4,100 97
Kimco Realty.............................. 5,600 222
Mills Corporation......................... 7,000 139
Pan Pacific Retail Properties............. 5,000 100
Rouse..................................... 5,700 157
Simon DeBartolo Group..................... 8,700 248
Tanger Factory Outlet Centers............. 1,200 25
Vornado Realty Trust...................... 8,600 290
Weingarten Realty Investors............... 2,300 102
---------
1,664
---------
Storage - 2.0%
Shurgard Storage Centers.................. 5,400 139
---------
Face Market
Description Amount (000) Value (000)
- --------------------------------------------------------------------------------
Total Common Stocks
(Cost $7,185)................................ 6,620
---------
REPURCHASE AGREEMENT - 5.7%
Morgan Stanley
4.850%, dated 12/31/98, matures
01/05/99, repurchase price
$401,239 (collateralized by
U.S. Treasury Note, total
market value: $416,322)................... $ 401 401
---------
Total Repurchase Agreement
(Cost $401).................................. 401
---------
Total Investments - 99.7%
(Cost $7,586)................................ 7,021
---------
Net Other Assets and Liabilities - 0.3%........ 22
---------
Total Net Assets - 100.0%...................... $ 7,043
=========
</TABLE>
- ----------------------------------
* Non-income producing security.
The accompanying notes are an integral part of the financial statements.
49
<PAGE>
Schedule of Investments
Asian Tigers Fund
[PIE CHART APPEARS HERE]
<TABLE>
<CAPTION>
% of Total Net Assets
<S> <C>
Metals & Mining 1.6%
Manufacturing 3.3%
Consumer Staples 7.6%
Oil / Energy 7.4%
Financial 20.2%
Mutual Funds 5.4%
Real Estate 12.0%
Technology 14.4%
Transportation 6.1%
Utilities 16.3%
Net Other Assets and Liabilities 4.8%
Agriculture 0.9%
</TABLE>
<TABLE>
<CAPTION>
Market
Description Shares Value (000)
- --------------------------------------------------------------------------------
<S> <C> <C>
FOREIGN COMMON STOCKS - 94.5%
China - 0.9%
Eastern Communications Class B*............. 275,000 $ 118
Nanjing Post & Telecom
Equipments, Class B....................... 367,800 83
Shanghai Tyre & Rubber Class B*............. 536,734 54
------
255
------
Hong Kong - 37.5%
Bank of East Asia........................... 31,000 54
Cathay Pacific Airways...................... 220,000 219
Cheung Kong Holdings........................ 138,000 993
China Resources Beijing Land................ 500,000 125
China Resources Enterprises................. 190,000 297
China Telecom*.............................. 103,000 178
CLP Holdings................................ 166,000 827
Citic Pacific............................... 110,000 237
Hang Seng Bank.............................. 108,000 965
Henderson China Holdings.................... 250,000 104
Henderson Land Development.................. 82,000 424
Hong Kong & China Gas....................... 198,502 252
Hong Kong & China Gas, WTS*
(Expires 09/30/99)(A)...................... 11,159 --
Hong Kong Electric Holdings................. 110,000 334
Hong Kong Telecommunications................ 595,000 1,041
HSBC Holdings............................... 37,200 927
Hutchison Whampoa........................... 200,000 1,413
Hysan Development, WTS*
(Expires 04/30/99)(A)...................... 10,000 --
Johnson Electric Holdings................... 264,600 680
Shanghai Industrial Holdings................ 70,000 141
Sun Hung Kai Properties..................... 111,000 809
Swire Pacific, Class A...................... 81,000 363
Varitronix International.................... 145,000 271
------
10,654
------
India - 7.5%
EIH, GDR.................................... 15,000 75
Hindalco Industries, GDR (B)................ 10,000 117
ITC, GDR.................................... 35,000 770
Mahanagar Telephone Nigam, GDR*............. 31,000 378
Reliance Industries, GDR.................... 58,000 329
State Bank of India, GDR.................... 5,500 46
Tata Electric Power, GDR.................... 14,000 56
Videsh Sanchar Nigam, GDR................... 30,000 360
------
2,131
------
Indonesia - 0.8%
Gulf Indonesia Resources*................... 2,000 13
PT Gudang Garam............................. 60,000 87
PT Indah Kiat Pulp & Paper.................. 427,805 116
PT Indah Kiat Pulp & Paper
WTS* (Expires 07/11/02).................... 29,288 4
------
220
------
Malaysia - 4.2%
Malakoff.................................... 105,000 208
Nestle...................................... 22,000 74
Petronas Gas................................ 35,000 67
Puncak Niaga Holding*....................... 100,000 62
Rothmans of Pall Mall....................... 34,600 172
Sime Darby.................................. 300,000 291
Sime UEP Properties......................... 45,000 36
Tenaga Nasional............................. 160,000 277
------
1,187
------
Philippines - 3.0%
Ayala Land.................................. 200,000 56
Belle WTS* (Expires 10/06/00)(A)............ 100,000 --
Benpres Holdings*........................... 150,000 24
Manila Electric, Class B.................... 46,920 151
Phillipine Long Distance Telephone.......... 9,000 231
Phillipine Long Distance Telephone, ADR..... 6,000 156
San Miguel, Class B......................... 54,450 105
SM Prime Holdings........................... 700,000 133
------
856
------
Singapore - 16.6%
City Developments........................... 66,600 288
Creative Technology*........................ 15,000 212
DBS Land.................................... 140,000 206
Development Bank of Singapore (F)........... 54,800 494
Keppel Corporation.......................... 49,500 132
Nasteel Electronics......................... 86,000 219
Overseas Chinese Banking (F)................ 70,160 476
Singapore Airlines (F)...................... 61,000 447
Singapore Press Holdings*................... 82 1
Singapore Press Holdings.................... 51,000 553
</TABLE>
The accompanying notes are an integral part of the financial statements.
50
<PAGE>
December 31, 1998
Schedule of Investments
<TABLE>
<CAPTION>
Market
Description Shares Value (000)
- --------------------------------------------------------------------------------
<S> <C> <C>
Singapore (continued)
Singapore Tech Engineering................. 300,000 $ 280
Singapore Telecommunications............... 670,000 1,023
United Overseas Bank (F)................... 60,000 385
----------
4,716
----------
South Korea - 9.8%
Housing & Commercial
Bank, GDR (B).............................. 11,146 138
Kookmin Bank, GDR (B)...................... 36,719 300
Korea Electric Power, ADR.................. 35,100 551
Korea Fund*................................ 47,451 439
Pohang Iron & Steel, ADR................... 21,000 354
Samsung Electronics, GDR (B)............... 25,011 855
SK Telecom, ADR............................ 13,659 139
----------
2,776
----------
Taiwan - 12.4%
Accton Technology, GDR*.................... 89,608 272
Acer, GDR*................................. 50,000 283
Ase Test*.................................. 22,000 712
Evergreen Marine, GDR...................... 36,050 326
Standard Foods Taiwan, GDR*................ 20,000 190
Taiwan Fund................................ 37,500 469
Taiwan Index Fund*......................... 70,000 648
Taiwan Semiconductor Manufacturing, ADR*... 43,500 617
----------
3,517
----------
Thailand - 1.8%
Bangkok Expressway (F)*.................... 100,000 91
PTT Exploration & Production (F)*.......... 58,000 408
----------
499
----------
Total Foreign Common Stocks
(Cost $30,920)............................... 26,811
----------
Total Investments - 94.5%
(Cost $30,920)............................... 26,811
----------
Net Other Assets and Liabilities - 5.5%........ 1,569
----------
Total Net Assets - 100.0%...................... $ 28,380
==========
</TABLE>
- -----------------------
* Non-income producing security
(A) Less than $500 at market value.
(B) Securities exempt from registration pursuant to Rule 144A under the
Securities Act of 1933, as amended. These securities may be resold, in
transactions exempt from registration, to qualified institutional buyers.
At December 31, 1998, these securities amounted to $1,409,630, or 5.0% of
net assets.
ADR American Depositary Receipt
(F) Foreign Registry Shares
GDR Global Depositary Receipt
WTS Warrants
The accompanying notes are an integral part of the financial statements.
51
<PAGE>
Schedule of Investments
Latin America Equity Fund
[PIE CHART APPEARS HERE]
<TABLE>
<CAPTION>
% of Total Net Assets
<S> <C>
Financial 5.6%
Consumer Staples 24.5%
Basic Materials 12.4%
Utilities 25.0%
Consumer Cyclicals 11.2%
Energy 15.1%
Health Care 1.4%
Real Estate 4.9%
</TABLE>
Net Other Assets and Liabilities (0.1)%
<TABLE>
<CAPTION>
Market
Description Shares Value (000)
- --------------------------------------------------------------------------------
<S> <C> <C>
FOREIGN COMMON STOCKS - 71.6%
Argentina - 8.4%
Cresud*................................. 124,933 $ 150
Irsa Inversiones, Class B............... 88,210 242
Quilmes Industrial Quins, ADR........... 38,000 354
Telefonica de Argentina, ADR............ 20,000 559
YPF, ADR*............................... 7,500 209
-------
1,514
-------
Brazil - 20.1%
Bompreco Supermercado, GDR.............. 31,500 236
CIA Energetica de Minas................. 13,461,470 189
CIA Pao de Acucar, ADR.................. 20,961 325
CIA Paranaense de
Energia-Copel, ADR..................... 29,000 207
CIA Paulista de Forca e Luz*............ 1,800,000 130
CIA Riograndense
de Telecomunicacoes.................... 860,000 310
CIA Saneamento Basico
do Estado de Sao Paulo................. 3,000,000 227
CIA Saneamento Basico
do Estado de Sao Paulo, RTS*
(expires 1/4/99) (A)................... 15,824 --
Centrais Electricas Bras................ 41,000,000 706
Centrais Geradoras
do Sul do Brasil*...................... 265,000,000 347
Light Services de
Electricidade.......................... 1,051,206 128
Telesp Participacoes, ADR............... 18,000 398
Uniao de Bancos Brasileiros, GDR........ 28,500 411
-------
3,614
-------
Chile - 10.3%
CIA Telecommunicaciones
Chile, ADR............................. 12,625 261
Embotelladora Andina
ADR, Class A........................... 21,000 305
Embotelladora Andina
ADR, Class B........................... 9,000 117
Enersis, ADR............................ 22,000 568
Laboratorio Chile, ADR.................. 18,000 259
Santa Isabel, ADR....................... 15,000 99
Vina Concha y Toro, ADR................. 9,500 246
-------
1,855
-------
Peru - 3.0%
Minsur.................................. 155,590 242
Telefonica de Peru, ADR................. 23,000 292
-------
534
-------
Mexico - 28.4%
Cemex................................... 135,000 291
Coca-Cola Femsa, ADR.................... 25,700 340
Consorcio Ara*.......................... 58,000 146
Corporacion GEO......................... 175,000 486
Corporacion Interamerica
de Entretenimientos.................... 120,000 327
Fomento Economico
Mexicano, ADR*......................... 35,000 932
Grupo Continental....................... 170,000 411
Grupo Posadas, Series L*................ 597,000 253
Kimberly-Clark de Mexico................ 166,000 527
Organizacion Soriana, Class B........... 200,000 636
Sigma Alimentos, Series B*.............. 133,447 232
Telefonos de Mexico, ADR................ 11,000 536
-------
5,117
-------
Venezula - 1.4%
CIA Anonima Nacional Telefonos de
Venezuela, ADR......................... 14,000 249
-------
Total Foreign Common Stocks
(Cost $16,335)........................... 12,883
-------
FOREIGN PREFERRED STOCKS - 28.5%
Brazil - 28.5%
Banco do Estado de Sao Paulo............ 9,000,000 373
Banco Itau.............................. 1,220,000 596
Bompreco Supermercados
do Nordeste............................ 10,000
Cervejaria Brahma....................... 600,000 262
CIA Energetica de Minas................. 11,000,000 209
CIA Paulista de
Forca e Luz* (A)....................... 4,843 --
CIA Siderurgica de
Tubarao................................ 40,000,000 168
CIA Vale do Rio Doce
Class B (A)............................ 25,000 --
CIA Vale do Rio Doce
Debenture, Class A..................... 40,000 513
Petrol Brasileiros...................... 5,300,000 601
</TABLE>
The accompanying notes are an integral part of the financial statements.
52
<PAGE>
December 31, 1998
Schedule of Investments
<TABLE>
<CAPTION>
Market
Description Shares Value (000)
<S> <C> <C>
Brazil (continued)
Sadia Concordia........................... 520,000 $ 267
Tele Cellular Sul Participacoes........... 80,000,000 135
Tele Centro Sul Participacoes............. 60,000,000 521
Tele Norte Leste Participacoes............ 47,800,000 597
Telecomunicacoes do Parana................ 800,000 142
Telecomunicacoes do Parana
Cellular, Class B....................... 2,300,000 145
Telesp Participacoes...................... 16,000,000 364
Usinas Siderurgicas de Minas Gerais....... 110,000 243
----------
Total Foreign Preferred Stocks
(Cost $6,989)............................... 5,136
----------
Total Investments - 100.1%
(Cost $23,324).............................. 18,019
----------
Net Other Assets and Liabilities - (0.1)%..... (26)
----------
Total Net Assets - 100.0%..................... $ 17,993
==========
</TABLE>
________________________________________________
* Non-income producing security
(A) Less than $500 at market value.
ADR American Depositary Receipt
GDR Global Depositary Receipt
RTS Rights
The accompanying notes are an integral part of the financial statements.
53
<PAGE>
Schedule of Investments
Small Cap Value Fund
[PIE CHART APPEARS HERE]
<TABLE>
<CAPTION>
% of Total Net Assets
<S> <C>
Repurchase Agreement & Net Other Assets and Liabilities 3.5%
Utilities 2.8%
Transportation 5.5%
Technology 6.6%
Health Care 4.8%
Financial 35.1%
Unit Investment Trust 2.1%
Basic Materials 5.9%
Capital Goods 3.6%
Consumer Cyclicals 25.4%
Consumer Staples 2.0%
Energy 2.7%
</TABLE>
<TABLE>
<CAPTION>
Market
Description Shares Value (000)
- --------------------------------------------------------------------------------
<S> <C> <C>
Common Stocks - 94.4%
Basic Materials - 5.9%
Fibermark*................................... 7,100 $ 97
Lone Star Industries......................... 7,400 272
Southdown.................................... 2,300 136
----------
505
----------
Capital Goods - 3.6%
Esterline Technologies*...................... 6,600 144
Kuhlman...................................... 4,300 163
----------
307
----------
Consumer Cyclicals - 25.4%
Advo Systems*................................ 5,600 148
Borg Warner Automotive....................... 3,500 195
Budget Group*................................ 9,000 143
Dollar Thrifty Automotive*................... 2,000 26
Furniture Brands International*.............. 8,400 229
General Nutrition*........................... 8,900 145
Gerber Childrenswear*........................ 10,800 94
Lennar....................................... 8,400 212
Lilly Industries............................. 10,750 214
Mohawk Industries*........................... 6,550 276
National Processing*......................... 14,200 78
Pillowtex.................................... 4,500 120
US Home*..................................... 5,150 171
Webb (Del E.)................................ 5,110 141
----------
2,192
----------
Consumer Staples - 2.0%
Merrill...................................... 9,000 174
----------
Energy - 2.7%
Newfield Exploration*........................ 4,950 103
Veritas DGC*................................. 10,200 133
----------
236
----------
Financial - 35.1%
Associated Banc.............................. 4,400 150
Commonwealth Bancorp......................... 9,900 154
First Industrial Realty Trust REIT........... 2,300 62
Golden State Bancorp*........................ 6,800 113
Golden State Bancorp -
Litigation Warrants*(A).................... 3,800 17
Hubco........................................ 9,850 297
Imperial Credit Commercial REIT.............. 6,700 63
Independence Community Bank.................. 8,300 132
Liberty Financial............................ 5,900 159
PBOC Holdings*............................... 17,850 183
Peoples Bancorp.............................. 17,700 192
Peoples Bancshares........................... 3,491 72
Peoples Bank Bridgeport...................... 6,150 170
Peoples Heritage Financial Group............. 8,400 168
Prosperity Bancshares*....................... 8,000 99
Reliance Bancorp............................. 5,500 153
Southbanc Shares............................. 8,810 164
Staten Island Bancorp........................ 8,100 161
US Bancorp (PA).............................. 3,730 74
UST.......................................... 3,100 73
Webster Financial............................ 7,500 206
WSFS Finanacial.............................. 9,500 160
----------
3,022
----------
Health Care - 4.8%
OEC Medical Systems*......................... 7,000 220
Quorum Health Group*......................... 6,900 89
Sun Healthcare Group*........................ 15,800 104
----------
413
----------
Technology - 6.6%
Hyperion Solutions*.......................... 4,000 72
Kronos*...................................... 2,100 93
National Data................................ 5,300 258
Pioneer Standard Electronics................. 15,400 144
----------
567
----------
Transportation - 5.5%
Covenant Transport*.......................... 9,800 175
US Freightways............................... 10,250 299
----------
474
----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
54
<PAGE>
DECEMBER 31, 1998
Schedule of Investments
<TABLE>
<CAPTION>
Shares/ Market
Description Face Amount (000) Value (000)
- --------------------------------------------------------------------------------
<S> <C> <C>
Utilities - 2.8%
E' Town...................................... 1,900 $ 90
Public Service Company of New Mexico......... 7,500 153
----------
243
----------
Total Common Stocks
(Cost $8,371).................................. 8,133
----------
UNIT INVESTMENT TRUST - 2.1%
S & P 400 Mid-Cap Depositary Receipts.......... 2,500 182
----------
Total Unit Investment Trust
(Cost $139).................................... 182
----------
REPURCHASE AGREEMENT - 5.0%
J.P. Morgan
4.850%, dated 12/31/98, matures
01/05/99, repurchase price
$434,082 (collateralized by
U.S. Treasury Note, total
market value: $443,732)...................... $ 434 434
----------
Total Repurchase Agreement
(Cost $434).................................... 434
----------
Total Investments - 101.5%
(Cost $8,944).................................. 8,749
----------
Net Other Assets and Liabilities - (1.5)% (130)
----------
Total Net Assets - 100.0%........................ $ 8,619
==========
</TABLE>
________________________________________________
* Non-income producing security
REIT Real Estate Investment Trust
(A) Issuer Golden State Bancorp Litigation Warrants. Expiration date set upon
settlement of litigation.
(PA) Pennsylvania
The accompanying notes are an integral part of the financial statements.
55
<PAGE>
Statement of Assets and Liabilities (000)
December 31, 1998
<TABLE>
<CAPTION>
Treasury Government Tax-Exempt
Money Market Money Market Money Market Money Market
Fund Fund Fund Fund
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS
Investment securities at cost.......................................... $180,665 $338,839 $ 915,697 $323,592
Repurchase agreements.................................................. 165,487 147,913 236,027 15,516
Net unrealized appreciation............................................ -- -- -- --
-------- -------- ---------- --------
Investments at market value............................................ 346,152 486,752 1,151,724 339,108
Cash and foreign currency.............................................. -- -- -- --
Receivable for investments sold........................................ -- -- -- --
Receivable for appreciation on forward foreign currency contracts...... -- -- -- --
Receivable for portfolio shares sold................................... -- -- 506 2
Dividends and interest receivable...................................... 896 1,222 13,561 2,130
Tax reclaim receivable................................................. -- -- -- --
Deferred organizational cost........................................... -- -- -- --
Other assets........................................................... 5 8 22 6
-------- -------- ---------- --------
Total assets........................................................... 347,053 487,982 1,165,813 341,246
-------- -------- ---------- --------
LIABILITIES:
Distribution payable................................................... 1,109 1,325 3,854 737
Payable due to custodian............................................... 1 4 6 13
Payable for investment securities purchased............................ -- -- -- --
Payable for portfolio shares redeemed.................................. -- 124 391 --
Advisory fee payable................................................... 55 80 201 62
Administration fee payable............................................. 22 31 73 25
Trustees fee payable................................................... -- 1 2 --
Accrued expenses & other payables...................................... 19 123 415 95
-------- -------- ---------- --------
Total liabilites....................................................... 1,206 1,688 4,942 932
-------- -------- ---------- --------
NET ASSETS................................................................ $345,847 $486,294 $1,160,871 $340,314
======== ======== ========== ========
NET ASSETS consist of:
Paid in capital........................................................ 345,843 486,266 1,160,867 340,315
Undistributed (distribution in excess of)
net investment income............................................. 9 32 4 --
Accumulated net realized gain (loss) on investments
and foreign currency transactions................................. (5) (4) -- (1)
Net unrealized appreciation (depreciation) on investments
and foreign currency related transactions......................... -- -- -- --
-------- -------- ---------- --------
NET ASSETS................................................................ $345,847 $486,294 $1,160,871 $340,314
======== ======== ========== ========
SHARES OF BENEFICIAL INTEREST
Common Share Class:
Net Assets........................................................ $328,222 $396,797 $ 941,295 $272,834
======== ======== ========== ========
Shares of beneficial interest outstanding......................... 328,219 396,769 941,293 272,835
======== ======== ========== ========
Net Asset Value, Offering and Redemption - Price Per Share................ $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ========== ========
Investor Share Class:
Net Assets........................................................ $ 17,625 $ 89,497 $ 219,576 $ 67,480
======== ======== ========== ========
Shares of beneficial interest outstanding......................... 17,624 89,498 219,575 67,480
======== ======== ========== ========
Net Asset Value, Offering and Redemption - Price Per Share................ $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ========== ========
</TABLE>
The accompanying notes are an integral part of the financial statements.
56
<PAGE>
December 31, 1998
<TABLE>
<CAPTION>
Intermediate
Government Tax-Exempt International International Small Cap
Fixed Income Fixed Income Fixed Income Fixed Income Balanced Value Growth Equity Growth
Fund Fund Fund Fund Fund Fund Fund Fund Fund
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$ 166,372 $ 41,157 $ 33,399 $ 15,484 $ 65,092 $158,643 $127,853 $ 97,539 $ 42,488
4,250 935 -- -- 2,629 9,366 7,817 -- 582
2,066 929 2,122 1,228 12,001 9,953 56,335 44,261 3,779
- ------------ ------------ ------------ ------------- -------- -------- -------- ------------- ---------
172,688 43,021 35,521 16,712 79,722 177,962 192,005 141,800 46,849
-- -- -- 1,133 112 37 -- 1,436 --
-- -- -- -- -- 14,216 421 1,115 211
-- -- -- 4 -- -- -- -- --
-- -- -- -- -- 15 -- -- 514
2,038 605 382 463 326 269 83 86 4
-- -- -- 35 -- -- -- 74 --
-- -- -- -- -- -- -- -- --
3 1 1 -- 1 3 3 2 1
- ------------ ------------ ------------ ------------- -------- -------- -------- ------------- ---------
174,729 43,627 35,904 18,347 80,161 192,502 192,512 144,513 47,579
- ------------ ------------ ------------ ------------- -------- -------- -------- ------------- ---------
2,381 175 133 449 581 19,726 3,877 301 --
2 1 1 245 -- -- 2 -- 1
-- -- -- -- 13 -- -- -- 748
36 287 12 87 25 11 314 118 --
74 18 15 12 47 132 123 118 30
18 7 6 5 14 28 27 21 9
-- -- -- -- -- -- -- -- --
29 14 14 14 31 36 35 78 18
- ------------ ------------ ------------ ------------- -------- -------- -------- ------------- ---------
2,540 502 181 812 711 19,933 4,378 636 806
- ------------ ------------ ------------ ------------- -------- -------- -------- ------------- ---------
$ 172,189 $ 43,125 $ 35,723 $ 17,535 $ 79,450 $172,569 $188,134 $ 143,877 $ 46,773
============ ============ =========== ============= ======== ======== ======== ============= =========
170,012 43,765 34,976 16,445 66,561 158,000 128,971 101,645 45,227
2 (111) (5) (179) (1) (11) -- (875) --
109 (1,458) (1,370) 42 889 4,627 2,828 (1,185) (2,233)
2,066 929 2,122 1,227 12,001 9,953 56,335 44,292 3,779
- ------------ ------------ ------------ ------------- -------- -------- -------- ------------- ---------
$ 172,189 $ 43,125 $ 35,723 $ 17,535 $ 79,450 $172,569 $188,134 $ 143,877 $ 46,773
============ ============ =========== ============= ======== ======== ======== ============= =========
$ 171,753 $ 43,062 $ 35,161 $ 17,482 $ 75,793 $170,945 $184,601 $ 142,862 $ 45,899
============ ============ =========== ============= ======== ======== ======== ============= =========
16,579 4,171 3,338 1,616 6,406 13,866 10,798 7,531 3,757
============ ============ =========== ============= ======== ======== ======== ============= =========
$ 10.36 $ 10.32 $ 10.53 $ 10.82 $ 11.83 $ 12.33 $ 17.10 $ 18.97 $ 12.22
============ ============ =========== ============= ======== ======== ======== ============= =========
$ 436 $ 63 $ 562 $ 53 $ 3,657 $ 1,624 $ 3,533 $ 1,015 $ 874
============ ============ =========== ============= ======== ======== ======== ============= =========
42 6 53 5 308 132 207 54 73
============ ============ =========== ============= ======== ======== ======== ============= =========
$ 10.41 $ 10.31 $ 10.51 $ 10.80 $ 11.86 $ 12.32 $ 17.06 $ 18.91 $ 12.04
============ ============ =========== ============= ======== ======== ======== ============= =========
</TABLE>
57
<PAGE>
Statement of Assets and Liabilities (000)
December 31, 1998
<TABLE>
<CAPTION>
Latin America Small Cap
Real Estate Asian Tigers Equity Value
Fund Fund Fund Fund
==================================================================================================================================
<S> <C> <C> <C> <C>
ASSETS:
Investment securities at cost......................................... $ 7,185 $ 30,920 $ 23,324 $ 8,510
Repurchase agreements................................................. 401 -- -- 434
Net unrealized depreciation........................................... (565) (4,109) (5,305) (195)
----------- ------------ ------------- ---------
Investments at market value........................................... 7,021 26,811 18,019 8,749
Cash and foreign currency............................................. -- 1,788 70 --
Receivable for investments sold....................................... -- -- 210 --
Receivable for appreciation on forward foreign currency contracts..... -- -- -- --
Receivable for portfolio shares sold.................................. -- 51 -- --
Dividends and interest receivable..................................... 40 115 248 10
Tax reclaim receivable................................................ -- -- -- --
Deferred organizational cost.......................................... 20 -- -- --
Other assets.......................................................... 3 -- 6 --
----------- ------------ ------------- ---------
Total assets.......................................................... 7,084 28,765 18,553 8,759
----------- ------------ ------------- ---------
LIABILITIES:
Distribution payable.................................................. -- 19 305 --
Payable due to custodian.............................................. -- -- -- --
Payable for investment securities purchased........................... 31 -- 209 116
Payable for portfolio shares redeemed................................. -- 299 15 --
Advisory fee payable.................................................. 4 24 17 6
Administration fee payable............................................ 1 8 6 1
Trustees fee payable.................................................. -- -- -- --
Accrued expenses & other payables..................................... 5 35 8 17
----------- ------------ ------------- ---------
Total liabilites...................................................... 41 385 560 140
----------- ------------ ------------- ---------
NET ASSETS............................................................ $ 7,043 $ 28,380 $ 17,993 $ 8,619
=========== ============ ============= =========
NET ASSETS consist of:
Paid in capital....................................................... 7,696 44,229 27,211 9,478
Undistributed (distribution in excess of)
net investment income............................................ -- 15 19 --
Accumulated net realized gain (loss) on investments
and foreign currency transactions................................ (88) (11,742) (3,933) (664)
Net unrealized appreciation (depreciation) on investments
and foreign currency related transactions........................ (565) (4,122) (5,304) (195)
----------- ------------ ------------- ---------
NET ASSETS.............................................................. $ 7,043 $ 28,380 $ 17,993 $ 8,619
=========== ============ ============= =========
SHARES OF BENEFICIAL INTEREST
Common Share Class:
Net Assets......................................................... $ 7,022 $ 28,202 $ 17,993 $ 8,295
=========== ============ ============= =========
Shares of beneficial interest outstanding.......................... 838 4,189 2,217 951
=========== ============ ============= =========
Net Asset Value, Offering and Redemption - Price Per Share.............. $ 8.37 $ 6.73 $ 8.12 $ 8.72
=========== ============ ============= =========
Investor Share Class:
Net Assets......................................................... $ 21 $ 178 $ -- $ 324
=========== ============ ============= =========
Shares of beneficial interest outstanding.......................... 2 27 -- 38
=========== ============ ============= =========
Net Asset Value, Offering and Redemption - Price Per Share.............. $ 10.63 $ 6.67 $ -- $ 8.54
=========== ============ ============= =========
</TABLE>
The accompanying notes are an integral part of the financial statements.
58
<PAGE>
December 31, 1998
<TABLE>
<CAPTION>
Statement of Operations (000)
For the Year Ended December 31, 1998
Treasury Government Tax-Exempt
Money Market Money Market Money Market Money Market
Fund Fund Fund Fund
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Investment income:
Dividend............................................. $ 119 $ -- $ -- $ 511
Interest............................................. 11,816 20,146 56,002 10,616
------------ ------------ ------------ -------------
Total investment income.............................. 11,935 20,146 56,002 11,127
------------ ------------ ------------ -------------
Expenses:
Investment advisory fees (Note 5).................... 802 738 3,537 1,074
Administration fees (Note 3)......................... 347 553 1,516 475
Fund accounting fees (Note 3)........................ 31 32 31 32
Custody fees......................................... 12 14 56 19
Transfer agency fees................................. 28 32 87 34
Professional fees.................................... 43 66 176 54
Registration & filing fees........................... 42 40 101 35
Printing fees........................................ 29 47 121 37
Trustee fees......................................... 4 6 18 6
Distribution fees (Note 3) (1)....................... 35 145 370 114
Shareholder servicing fees (Note 3) (2).............. 35 146 373 114
Amortization of deferred organization costs.......... -- -- -- --
Miscellaneous........................................ 23 8 18 12
------------ ------------ ------------ -------------
Total expenses before waivers...................... 1,431 1,827 6,404 2,006
Less: Investment advisory fees waived (Note 5)..... (344) -- (1,516) (460)
Less: Administration fees waived (Note 3).......... (159) (263) (778) (220)
Less: Shareholder servicing fees waived (Note 3)... (35) (106) (208) (114)
------------ ------------ ------------ -------------
Net expenses......................................... 893 1,458 3,902 1,212
------------ ----------- ------------ -------------
Net investment income.................................. 11,042 18,688 52,100 9,915
------------ ------------ ------------ ------------
Net realized gain on investments:
Net realized gain from securities transactions..... 1 - - 6
------------ ------------ ------------ -------------
Net increase in net assets from operations............. $ 11,043 $ 18,688 $ 52,100 $ 9,921
============ ============ ============ =============
</TABLE>
(1) All distribution fees are incurred at the Investor Share Class level.
(2) All shareholder servicing fees are incurred at the Investor Share Class
level.
59
<PAGE>
Statement of Operations (000)
For the Year Ended December 31, 1998
<TABLE>
<CAPTION>
Intermediate
Government Tax-Exempt International
Fixed Income Fixed Income Fixed Income Fixed Income
Fund Fund Fund Fund
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Investment income:
Dividends....................................................... $ -- $ -- $ 23 $ --
Interest........................................................ 10,241 2,847 1,952 885
Less: foreign taxes withheld.................................... -- -- -- (10)
------------ ------------ ------------ ------------
Total investment income......................................... 10,241 2,847 1,975 875
------------ ------------ ------------ ------------
Expenses:
Investment advisory fees (Note 5)............................... 1,000 292 222 140
Administration fees (Note 3).................................... 250 73 56 26
Fund accounting fees (Note 3)................................... 37 33 36 37
Custody fees.................................................... 19 7 5 9
Transfer agency fees............................................ 35 17 15 12
Professional fees............................................... 32 10 8 3
Registration & filing fees...................................... 32 22 15 19
Printing fees................................................... 20 6 5 2
Trustee fees.................................................... 3 1 1 --
Distribution fees (Note 3)(1)................................... 1 -- 1 --
Shareholder servicing fees (Note 3) (2)......................... 1 -- 1 --
Amortization of deferred organization costs..................... -- -- -- --
Miscellaneous................................................... 8 4 1 1
------------ ------------ ------------ ------------
Total expenses before waivers................................. 1,438 465 366 249
Less: Investment advisory fees waived (Note 5)................ (167) (49) (37) --
Less: Administration fees waived (Note 3)..................... (71) (20) (15) (7)
Less: Shareholder servicing fees waived (Note 3).............. -- -- -- --
------------ ------------ ------------ ------------
Net expenses.................................................... 1,200 396 314 242
------------ ------------ ------------ ------------
Net investment income (loss)...................................... 9,041 2,451 1,661 633
------------ ------------ ------------ ------------
Net realized and unrealized gain (loss) on investments:
Net realized gain (loss) from securities transactions......... 2,974 1,003 673 (182)
Net realized gain (loss) from foreign currency transactions... -- -- -- 77
Net change in unrealized appreciation (depreciation)
on investments............................................... (798) 399 (216) 1,903
Net change in unrealized appreciation (depreciation) on
foreign currency and translation of other assets and
liabilities in foreign currencies............................ -- -- -- 6
------------ ------------ ------------ ------------
Net gain (loss) on investments.................................... 2,176 1,402 457 1,804
------------ ------------ ------------ ------------
Net increase (decrease) in net assets from operations............. $ 11,217 $ 3,853 $ 2,118 $ 2,437
============ ============ ============ ============
</TABLE>
(1) All distribution fees are incurred at the Investor Share Class level.
(2) All shareholder servicing fees are incurred at the Investor Share Class
level.
(3) Commenced operations on June 30, 1998.
The accompanying notes are an integral part of the financial statements.
60
<PAGE>
DECEMBER 31, 1998
<TABLE>
<CAPTION>
Latin
International Small Cap Asian America Small Cap
Balanced Value Growth Equity Growth Real Estate Tigers Equity Value
Fund Fund Fund Fund Fund Fund Fund Fund Fund(3)
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$ 900 $ 4,361 $ 1,321 $ 1,773 $ 55 $ 274 $ 802 $ 903 $ 40
1,518 413 395 90 106 23 17 6 20
(7) -- -- (201) -- -- (48) (8) --
- -------- -------- ------- ------------- --------- ----------- ------- -------- ---------
2,411 4,774 1,716 1,662 161 297 771 901 60
- -------- -------- ------- ------------- --------- ----------- ------- -------- ---------
546 1,674 1,280 1,183 390 49 298 288 28
117 314 240 177 73 7 45 43 5
46 33 35 40 35 2 41 37 1
17 21 19 126 11 2 74 91 3
22 43 35 27 18 8 14 10 9
15 35 30 21 9 1 6 6 1
26 36 28 34 26 12 13 17 8
10 27 20 14 6 1 4 4 --
1 4 3 2 1 -- 1 -- --
9 4 8 3 1 -- -- -- --
8 3 7 2 1 -- 1 -- --
-- -- -- -- 5 2 2 --
4 12 5 9 3 -- 2 5 2
- -------- -------- ------- ------------- --------- ----------- ------- -------- ---------
821 2,206 1,710 1,638 574 87 501 503 57
-- -- -- -- -- (15) -- -- --
-- -- -- -- -- (3) -- -- (3)
-- -- -- -- -- -- -- -- --
- -------- -------- ------- ------------- --------- ----------- ------- -------- ---------
821 2,206 1,710 1,638 574 69 501 503 54
- -------- -------- ------- ------------- --------- ----------- ------- -------- ---------
1,590 2,568 6 24 (413) 228 270 398 6
- -------- -------- ------- ------------- --------- ----------- ------- -------- ---------
4,860 33,525 13,906 (1,183) (2,200) (125) (6,341) (3,886) (664)
-- -- -- (465) -- -- (186) (62) --
1,217 (21,890) 29,876 27,554 (962) (550) 3,267 (8,584) (195)
-- -- -- 45 -- -- (12) 2 --
- -------- -------- ------- ------------- --------- ----------- ------- -------- ---------
6,077 11,635 43,782 25,951 (3,162) (675) (3,272) (12,530) (859)
- -------- -------- ------- ------------- --------- ----------- ------- -------- ---------
$ 7,667 $ 14,203 $43,788 $ 25,975 $ (3,575) $ (447) $(3,002) $(12,132) $ (853)
======== ======== ======= ============= ========= =========== ======= ======== =========
</TABLE>
61
<PAGE>
Statement of Changes in Net Assets (000)
For the Year Ended December 31,
<TABLE>
<CAPTION>
Treasury
Money Market
Fund
======================================================================================================================
1998 1997
======================================================================================================================
<S> <C> <C>
Operations:
Net investment income...................................................................... $ 11,042 $ 9,371
Net realized gain (loss) from security transactions........................................ 1 (4)
Net change in unrealized appreciation (depreciation) on investments
and foreign currency related transactions............................................... -- --
--------- ---------
Net increase in net assets resulting from operations....................................... 11,043 9,367
--------- ---------
Dividends distributed from:
Net investment income:
Common Share Class....................................................................... (10,402) (9,005)
Investor Share Class..................................................................... (640) (366)
Net realized gains:
Common Share Class....................................................................... -- --
Investor Share Class..................................................................... -- --
--------- ---------
Total dividends distributed............................................................ (11,042) (9,371)
--------- ---------
Capital share transactions:
Common Share Class:
Proceeds from shares issued.............................................................. 849,198 779,855
Shares issued in reinvestment of distributions........................................... 328 94
Cost of shares repurchased............................................................... (710,064) (747,639)
--------- ---------
Increase (decrease) in net assets derived from Common Share Class transactions........... 139,462 32,310
Investor Share Class:
Proceeds from shares issued.............................................................. 111,616 31,377
Shares issued in reinvestment of distributions........................................... 640 401
Cost of shares repurchased............................................................... (101,355) (35,966)
--------- ---------
Increase (decrease) in net assets derived from Investor Share Class transactions......... 10,901 (4,188)
--------- ---------
Increase in net assets derived from capital share transactions........................... 150,363 28,122
--------- ---------
Net increase in net assets................................................................. 150,364 28,118
Net Assets:
Beginning of year.......................................................................... 195,483 167,365
--------- ---------
End of year................................................................................ $ 345,847 $ 195,483
========= =========
Capital share transactions:
Common Share Class:
Shares issued............................................................................ 849,198 779,855
Shares issued in reinvestment of distributions........................................... 328 94
Shares repurchased....................................................................... (710,064) (747,639)
--------- ---------
Total Common Share Class transactions.................................................. 139,462 32,310
--------- ---------
Investor Share Class:
Shares issued............................................................................ 111,616 31,377
Shares issued in reinvestment of distributions........................................... 640 401
Shares repurchased....................................................................... (101,355) (35,966)
--------- ---------
Total Investor Share Class transactions................................................ 10,901 (4,188)
--------- ---------
Net increase in capital shares......................................................... 150,363 28,122
========= =========
</TABLE>
The accompanying notes are an integral part of the financial statements.
62
<PAGE>
DECEMBER 31, 1998
<TABLE>
<CAPTION>
Government Tax-Exempt
Money Market Money Market Money Market Fixed Income
Fund Fund Fund Fund
- ---------------------------------------------------------------------------------------------------------
1998 1997 1998 1997 1998 1997 1998 1997
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 18,688 $ 12,927 $ 52,100 $ 36,661 $ 9,915 $ 8,513 $ 9,041 $ 7,979
-- -- -- -- 6 (3) 2,974 2,841
-- -- -- -- -- -- (798) 1,292
--------- --------- ----------- ----------- --------- --------- -------- --------
18,688 12,927 52,100 36,661 9,921 8,510 11,217 12,112
--------- --------- ----------- ----------- --------- --------- -------- --------
(15,907) (12,639) (44,888) (36,562) (8,560) (8,421) (9,325) (7,944)
(2,781) (288) (7,212) (99) (1,355) (92) (23) (24)
-- -- -- -- -- -- (2,080) (69)
-- -- -- -- -- -- (5) --
--------- --------- ----------- ----------- --------- --------- -------- --------
(18,688) (12,927) (52,100) (36,661) (9,915) (8,513) (11,433) (8,037)
--------- --------- ----------- ----------- --------- --------- -------- --------
961,904 670,698 2,199,812 1,646,777 794,878 704,742 52,981 37,017
2,734 903 652 93 139 -- 2,615 749
(823,101) (672,734) (1,996,903) (1,507,850) (772,450) (642,108) (24,774) (24,610)
--------- --------- ----------- ----------- --------- --------- -------- --------
141,537 (1,133) 203,561 139,020 22,567 62,634 30,822 13,156
--------- --------- ----------- ----------- --------- --------- -------- --------
294,386 39,993 994,823 12,453 270,523 25,920 22 --
2,781 310 7,204 101 1,345 90 41 24
(216,601) (36,464) (783,735) (12,737) (207,365) (25,839) (56) (68)
--------- --------- ----------- ----------- --------- --------- -------- --------
80,566 3,839 218,292 (183) 64,503 171 7 (44)
--------- --------- ----------- ----------- --------- --------- -------- --------
222,103 2,706 421,853 138,837 87,070 62,805 30,829 13,112
--------- --------- ----------- ----------- --------- --------- -------- --------
222,103 2,706 421,853 138,837 87,076 62,802 30,613 17,187
264,191 261,485 739,018 600,181 253,238 190,436 141,576 124,389
--------- --------- ----------- ----------- --------- --------- -------- --------
$ 486,294 $ 264,191 $ 1,160,871 $ 739,018 $ 340,314 $ 253,238 $172,189 $141,576
========= ========= =========== =========== ========= ========= ======== ========
961,904 670,698 2,199,812 1,646,777 794,878 704,742 5,052 3,648
2,734 903 652 93 139 254 73
(823,101) (672,734) (1,996,903) (1,507,850) (772,450) (642,108) (2,362) (2,408)
--------- --------- ----------- ----------- --------- --------- -------- --------
141,537 (1,133) 203,561 139,020 22,567 62,634 2,944 1,313
--------- --------- ----------- ----------- --------- --------- -------- --------
294,386 39,993 994,824 12,453 270,523 25,920 2 --
2,781 310 7,204 101 1,345 90 4 2
(216,601) (36,464) (783,735) (12,737) (207,365) (25,839) (5) (6)
--------- --------- ----------- ----------- --------- --------- -------- --------
80,566 3,839 218,293 (183) 64,503 171 1 (4)
--------- --------- ----------- ----------- --------- --------- -------- --------
222,103 2,706 421,854 138,837 87,070 62,805 2,945 1,309
========= ========= =========== =========== ========= ========= ======== ========
</TABLE>
63
<PAGE>
Statement of Changes in Net Assets (000)
For the Year Ended December 31,
<TABLE>
<CAPTION>
Intermediate
Government Fixed
Income Fund
- ------------------------------------------------------------------------------------------------------------------
1998 1997
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Operations:
Net investment income............................................................. $ 2,451 $ 3,050
Net realized gain (loss) from security transactions............................... 1,003 975
Net change in unrealized appreciation (depreciation) on investments
and foreign currency related transactions........................................ 399 13
--------- --------
Net increase (decrease) in net assets resulting from operations................... 3,853 4,038
--------- --------
Dividends distributed from:
Net investment income:
Common Share Class............................................................... (2,454) (3,042)
Investor Share Class............................................................. (3) (7)
Net realized gains:
Common Share Class............................................................... -- (21)
Investor Share Class............................................................. -- --
--------- --------
Total dividends distributed.................................................... (2,457) (3,070)
--------- --------
Capital share transactions:
Common Share Class:
Proceeds from shares issued...................................................... 4,537 11,087
Shares issued in reinvestment of distributions................................... 116 66
Cost of shares repurchased....................................................... (14,919) (17,079)
--------- --------
Increase (decrease) in net assets derived from Common Share Class transactions... (10,266) (5,926)
--------- --------
Investor Share Class:
Proceeds from shares issued...................................................... -- 7
Shares issued in reinvestment of distributions................................... 3 7
Cost of shares repurchased....................................................... (46) (164)
--------- --------
Increase (decrease) in net assets derived from Investor Share Class transactions. (43) (150)
--------- --------
Increase (decrease) in net assets derived from capital share transactions........ (10,309) (6,076)
--------- --------
Net increase in net assets........................................................ (8,913) (5,108)
Net Assets:
Beginning of year................................................................. 52,038 57,146
--------- --------
End of year....................................................................... $ 43,125 $ 52,038
========= ========
Capital share transactions:
Common Share Class:
Shares issued.................................................................... 444 1,115
Shares issued in reinvestment of distributions................................... 12 7
Shares repurchased............................................................... (1,456) (1,723)
--------- --------
Total Common Share Class transactions.......................................... (1,000) (601)
--------- --------
Investor Share Class:
Shares issued.................................................................... -- 1
Shares issued in reinvestment of distributions................................... -- 1
Shares repurchase................................................................ (4) (17)
--------- --------
Total Investor Share Class transactions........................................ (4) (15)
--------- --------
Net increase (decrease) in capital shares...................................... (1,004) (616)
========= ========
</TABLE>
The accompanying notes are an integral part of the financial statements.
64
<PAGE>
<TABLE>
<CAPTION>
Tax-Exempt International
Fixed Income Fixed Income Balanced Value
Fund Fund Fund Fund
- -----------------------------------------------------------------------------------------
1998 1997 1998 1997 1998 1997 1998 1997
- -----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 1,661 $ 1,924 $ 633 $ 698 $ 1,590 $ 1,779 $ 2,568 $ 3,168
673 364 (105) (685) 4,860 7,701 33,525 43,782
(216) 1,246 1,909 (1,191) 1,217 3,720 (21,890) 5,882
-------- ------- ------- ------- -------- -------- -------- --------
2,118 3,534 2,437 (1,178) 7,667 13,200 14,203 52,832
-------- ------- ------- ------- -------- -------- -------- --------
(1,648) (1,897) (295) -- (1,535) (1,679) (2,568) (3,124)
(22) (26) (1) -- (60) (95) (13) (23)
-- -- (159) -- (9,809) (1,663) (67,685) (6,385)
-- -- -- -- (481) (101) (512) (55)
-------- ------- ------- ------- -------- -------- -------- --------
(1,670) (1,923) (455) -- (11,885) (3,538) (70,778) (9,587)
-------- ------- ------- ------- -------- -------- -------- --------
4,836 6,666 2,932 5,852 17,520 15,990 30,539 46,181
22 1 5 -- 10,179 2,033 20,219 1,761
(10,580) (7,571) (3,005) (6,666) (16,384) (13,135) (44,296) (34,888)
-------- ------- ------- ------- -------- -------- -------- --------
(5,722) (904) (68) (814) 11,315 4,888 6,462 13,054
-------- ------- ------- ------- -------- -------- -------- --------
102 -- -- 1 102 202 343 185
20 25 1 -- 538 194 529 76
(103) (190) (22) (40) (967) (522) (773) (359)
-------- ------- ------- ------- -------- -------- -------- --------
19 (165) (21) (39) (327) (126) 99 (98)
-------- ------- ------- ------- -------- -------- -------- --------
(5,703) (1,069) (89) (853) 10,988 4,762 6,561 12,956
-------- ------- ------- ------- -------- -------- -------- --------
(5,255) 542 1,893 (2,031) 6,770 14,424 (50,014) 56,201
40,978 40,436 15,642 17,673 72,680 58,256 222,583 166,382
-------- ------- ------- ------- -------- -------- -------- --------
$ 35,723 $40,978 $17,535 $15,642 $ 79,450 $ 72,680 $172,569 $222,583
======== ======= ======= ======= ======== ======== ======== ========
462 658 295 598 1,378 1,341 2,026 3,041
2 -- 1 -- 889 162 1,455 110
(1,010) (753) (296) (696) (1,245) (1,089) (2,974) (2,235)
-------- ------- ------- ------- -------- -------- -------- --------
(546) (95) -- (98) 1,022 414 507 916
-------- ------- ------- ------- -------- -------- -------- --------
9 -- -- -- 8 17 24 12
2 2 -- -- 47 16 38 5
(10) (18) (2) (4) (74) (44) (49) (24)
-------- ------- ------- ------- -------- -------- -------- --------
1 (16) (2) (4) (19) (11) 13 (7)
-------- ------- ------- ------- -------- -------- -------- --------
(545) (111) (2) (102) 1,003 403 520 909
======== ======= ======= ======= ======== ======== ======== ========
</TABLE>
65
<PAGE>
<TABLE>
<CAPTION>
Statement of Changes in Net Assets (000)
For the Year Ended December 31,
International
Growth Equity
Fund Fund
====================================================================================================================================
1998 1997 1998 1997
====================================================================================================================================
<S> <C> <C> <C> <C>
Operations:
Net investment income (loss).............................................. $ 6 $ 955 $ 24 $ 219
Net realized gain (loss) from security and foreign currency transactions.. 13,906 18,291 (1,648) 6,992
Net change in unrealized appreciation (depreciation) on investments
and foreign currency related transactions................................ 29,876 5,511 27,599 (1,435)
-------- -------- -------- --------
Net increase (decrease) in net assets resulting from operations........... 43,788 24,757 25,975 5,776
-------- -------- -------- --------
Dividends distributed from:
Net investment income:
Common Share Class...................................................... (188) (927) (696) (438)
Investor Share Class.................................................... - (19) (1) (3)
Net realized gains:
Common Share Class...................................................... (16,848) (12,320) (1,326) (5,820)
Investor Share Class.................................................... (320) (318) (10) (83)
Paid in capital:
Common Share class...................................................... - - - -
Investor Share class.................................................... - - - -
-------- -------- -------- --------
Total dividends distributed........................................... (17,356) (13,584) (2,033) (6,344)
-------- -------- -------- --------
Capital share transactions:
Common Share Class:
Proceeds from shares issued............................................. 42,338 37,264 48,964 25,978
Shares issued in reinvestment of distributions.......................... 10,985 8,048 608 2,329
Cost of shares repurchased.............................................. (27,254) (18,688) (15,857) (38,751)
-------- -------- -------- --------
Increase (decrease) in net assets derived from
Common Share Class transactions....................................... 26,069 26,624 33,715 (10,444)
-------- -------- -------- --------
Investor Share Class:
Proceeds from shares issued............................................. 333 139 32 266
Shares issued in reinvestment of distributions.......................... 320 335 12 83
Cost of shares repurchased.............................................. (1,154) (383) (509) (702)
-------- -------- -------- --------
Increase (decrease) in net assets derived from
Investor Share Class transactions..................................... (501) 91 (465) (353)
-------- -------- -------- --------
Increase (decrease) in net assets derived from capital share
transactions.......................................................... 25,568 26,715 33,250 (10,797)
-------- -------- -------- --------
Net increase (decrease) in net assets..................................... 52,000 37,888 57,192 (11,365)
Net Assets:
Beginning of year......................................................... 136,134 98,246 86,685 98,050
-------- -------- -------- --------
End of year............................................................... $188,134 $136,134 $143,877 $ 86,685
======== ======== ======== ========
Capital share transactions:
Common Share Class:
Shares issued........................................................... 2,692 2,520 2,880 1,544
Shares issued in reinvestment of distributions.......................... 697 561 36 151
Shares repurchased...................................................... (1,696) (1,265) (941) (2,232)
-------- -------- -------- --------
Total Common Share Class transactions................................. 1,693 1,816 1,975 (537)
-------- -------- -------- --------
Investor Share Class:
Shares issued........................................................... 21 9 2 15
Shares issued in reinvestment of distributions.......................... 20 23 1 5
Shares repurchased...................................................... (73) (25) (30) (41)
-------- -------- -------- --------
Total Investor Share Class transactions............................... (32) 7 (27) (21)
-------- -------- -------- --------
Net increase (decrease) in capital shares............................. 1,661 1,823 1,948 (558)
======== ======== ======== ========
</TABLE>
(1) Commenced operations on December 31, 1997.
(2) Commenced operations on June 30, 1998.
The accompanying notes are an integral part of the financial statements.
66
<PAGE>
December 31, 1998
<TABLE>
<CAPTION>
Small Cap
Growth Real Estate
Fund Fund
====================================================================================================================================
1998 1997 1998 1997/(1)/
====================================================================================================================================
<S> <C> <C> <C> <C>
Operations:
Net investment income (loss).............................................. $ (413) $ (288) $ 228 $ --
Net realized gain (loss) from security and foreign currency transactions.. (2,200) 4,939 (125) --
Net change in unrealized appreciation (depreciation) on investments
and foreign currency related transactions................................ (962) 631 (550) (15)
-------- -------- ------ ------
Net increase (decrease) in net assets resulting from operations........... (3,575) 5,282 (447) (15)
-------- -------- ------ ------
Dividends distributed from:
Net investment income:
Common Share Class...................................................... -- -- (191) --
Investor Share Class.................................................... -- -- -- --
Net realized gains:
Common Share Class...................................................... (837) (4,879) -- --
Investor Share Class.................................................... (9) (63) -- --
Paid in capital:
Common Share class...................................................... (3) -- (37) --
Investor Share class.................................................... -- -- -- --
-------- -------- ------ ------
Total dividends distributed........................................... (849) (4,942) (228) --
-------- -------- ------ ------
Capital share transactions:
Common Share Class:
Proceeds from shares issued............................................. 21,352 20,984 5,249 3,000
Shares issued in reinvestment of distributions.......................... 89 273 227 --
Cost of shares repurchased.............................................. (13,065) (16,009) (764) --
-------- -------- ------ ------
Increase (decrease) in net assets derived from
Common Share Class transactions....................................... 8,376 5,248 4,712 3,000
-------- -------- ------ ------
Investor Share Class:
Proceeds from shares issued............................................. 2,408 31 21 --
Shares issued in reinvestment of distributions.......................... 8 54 -- --
Cost of shares repurchased.............................................. (2,092) (130) -- --
-------- -------- ------ ------
Increase (decrease) in net assets derived from
Investor Share Class transactions..................................... 324 (45) 21 --
-------- -------- ------ ------
Increase (decrease) in net assets derived from capital share
transactions.......................................................... 8,700 5,203 4,733 3,000
-------- -------- ------ ------
Net increase (decrease) in net assets..................................... 4,276 5,543 4,058 2,985
Net Assets:
Beginning of year......................................................... 42,497 36,954 2,985 --
-------- -------- ------ ------
End of year............................................................... $ 46,773 $ 42,497 $7,043 $2,985
======== ======== ====== ======
Capital share transactions:
Common Share Class:
Shares issued........................................................... 1,633 1,495 597 300
Shares issued in reinvestment of distributions.......................... 9 21 26 --
Shares repurchased...................................................... (1,021) (1,171) (85) --
-------- -------- ------ ------
Total Common Share Class transactions................................. 621 345 538 300
-------- -------- ------ ------
Investor Share Class:
Shares issued........................................................... 214 2 2 --
Shares issued in reinvestment of distributions.......................... 1 4 -- --
Shares repurchased...................................................... (184) (9) -- --
-------- -------- ------ ------
Total Investor Share Class transactions............................... 31 (3) 2 --
-------- -------- ------ ------
Net increase (decrease) in capital shares............................. 652 342 540 300
======== ======== ====== ======
</TABLE>
<TABLE>
<CAPTION>
Latin
Asian America Small Cap
Tigers Equity Value
Fund Fund Fund
====================================================================================================================================
1998 1997 1998 1997 1998/(2)/
====================================================================================================================================
<S> <C> <C> <C> <C> <C>
Operations:
Net investment income (loss).............................................. $ 270 $ 191 $ 398 $ 145 $ 6
Net realized gain (loss) from security and foreign currency transactions.. (6,527) (5,525) (3,948) 1,914 (664)
Net change in unrealized appreciation (depreciation) on investments
and foreign currency related transactions................................ 3,255 (12,810) (8,582) 2,861 (195)
-------- -------- -------- ------- ------
Net increase (decrease) in net assets resulting from operations........... (3,002) (18,144) (12,132) 4,920 (853)
-------- -------- -------- ------- ------
Dividends distributed from:
Net investment income:
Common Share Class...................................................... (25) (68) (328) (84) (6)
Investor Share Class.................................................... -- -- -- -- --
Net realized gains:
Common Share Class...................................................... -- (54) (217) (1,686) --
Investor Share Class.................................................... -- (1) -- -- --
Paid in capital:
Common Share class...................................................... -- -- -- -- (2)
Investor Share class.................................................... -- -- -- -- --
-------- -------- -------- ------- ------
Total dividends distributed........................................... (25) (123) (545) (1,770) (8)
-------- -------- -------- ------- ------
Capital share transactions:
Common Share Class:
Proceeds from shares issued............................................. 24,987 31,613 12,201 24,480 9,241
Shares issued in reinvestment of distributions.......................... 6 25 15 9 6
Cost of shares repurchased.............................................. (28,451) (12,463) (14,817) (5,858) (120)
-------- -------- -------- ------- ------
Increase (decrease) in net assets derived from
Common Share Class transactions....................................... (3,458) 19,175 (2,601) 18,631 9,127
-------- -------- -------- ------- ------
Investor Share Class:
Proceeds from shares issued............................................. 201 15,971 -- -- 358
Shares issued in reinvestment of distributions.......................... -- 1 -- -- --
Cost of shares repurchased.............................................. (334) (16,324) -- -- (5)
-------- -------- -------- ------- ------
Increase (decrease) in net assets derived from
Investor Share Class transactions..................................... (133) (352) -- -- 353
-------- -------- -------- ------- ------
Increase (decrease) in net assets derived from capital share
transactions.......................................................... (3,591) 18,823 (2,601) 18,631 9,480
-------- -------- -------- ------- ------
Net increase (decrease) in net assets..................................... (6,618) 556 (15,278) 21,781 8,619
Net Assets:
Beginning of year......................................................... 34,998 34,442 33,271 11,490 --
-------- -------- -------- ------- ------
End of year............................................................... $ 28,380 $ 34,998 $ 17,993 $33,271 $8,619
======== ======== ======== ======= ======
Capital share transactions:
Common Share Class:
Shares issued........................................................... 4,093 3,045 1,167 1,841 965
Shares issued in reinvestment of distributions.......................... 1 3 2 1 1
Shares repurchased...................................................... (4,465) (1,310) (1,485) (430) (15)
-------- -------- -------- ------- ------
Total Common Share Class transactions................................. (371) 1,738 (316) 1,412 951
-------- -------- -------- ------- ------
Investor Share Class:
Shares issued........................................................... 31 1,419 -- -- 38
Shares issued in reinvestment of distributions.......................... -- -- -- -- --
Shares repurchased...................................................... (48) (1,446) -- -- --
-------- -------- -------- ------- ------
Total Investor Share Class transactions............................... (17) (27) -- -- 38
-------- -------- -------- ------- ------
Net increase (decrease) in capital shares............................. (388) 1,711 (316) 1,412 989
======== ======== ======== ======= ======
</TABLE>
67
<PAGE>
Financial Highlights
For a Share Outstanding for the Years Ended December 31,
<TABLE>
<CAPTION>
Net Asset Realized Dividends Distributions
Value Net and Unrealized from Net from
Beginning Investment Gains Investment Capital
of Period Income on Securties Income Gains
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Treasury Money Market Fund
- ------------------------------------------------------------------------------------------------------------------------
Common Share Class
1998 $1.00 $0.05 $0.00 $(0.05) $0.00
1997 1.00 0.05 0.00 (0.05) 0.00
1996 1.00 0.05 0.00 (0.05) 0.00
1995 1.00 0.05 0.00 (0.05) 0.00
1994 1.00 0.04 0.00 (0.04) 0.00
Investor Share Class
1998 $1.00 $0.05 $0.00 $(0.05) $0.00
1997 1.00 0.05 0.00 (0.05) 0.00
1996 1.00 0.04 0.00 (0.04) 0.00
1995 1.00 0.05 0.00 (0.05) 0.00
1994 1.00 0.03 0.00 (0.03) 0.00
- ------------------------------------------------------------------------------------------------------------------------
Government Money Market Fund
- ------------------------------------------------------------------------------------------------------------------------
Common Share Class
1998 $1.00 $0.05 $0.00 $(0.05) $0.00
1997 1.00 0.05 0.00 (0.05) 0.00
1996 1.00 0.05 0.00 (0.05) 0.00
1995 1.00 0.05 0.00 (0.05) 0.00
1994 1.00 0.04 0.00 (0.04) 0.00
Investor Share Class
1998 $1.00 $0.05 $0.00 $(0.05) $0.00
1997 1.00 0.05 0.00 (0.05) 0.00
1996 1.00 0.05 0.00 (0.05) 0.00
1995 1.00 0.05 0.00 (0.05) 0.00
1994 1.00 0.04 0.00 (0.04) 0.00
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
68
<PAGE>
December 31, 1998
<TABLE>
<CAPTION>
Ratio of Net
Investment
Ratio of Net Ratio of Expenses Income
Ratio of Investment to Average to Average
Net Asset Net Assets Expenses Income Net Assets Net Assets
Value End Total End of to Average to Average (Excluding (Excluding
of Period Return Period (000) Net Assets Net Assets Waivers) Waivers)
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------
$1.00 4.90% $328,222 0.37% 4.79% 0.59% 4.58%
1.00 4.97 188,761 0.33 4.86 0.57 4.62
1.00 4.80 156,455 0.44 4.70 0.59 4.55
1.00 5.28 110,475 0.44 5.16 0.59 5.01
1.00 3.58 111,545 0.45 3.50 0.61 3.34
$1.00 4.64% $ 17,625 0.62% 4.54% 1.09% 4.08%
1.00 4.70 6,722 0.58 4.60 0.88 4.30
1.00 4.54 10,910 0.69 4.45 0.84 4.30
1.00 5.02 7,931 0.69 4.89 0.84 4.74
1.00 3.32 3,231 0.70 3.52 0.86 3.36
- ------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------
$1.00 5.24% $396,797 0.35% 5.12% 0.42% 5.04%
1.00 5.33 255,259 0.32 5.21 0.40 5.13
1.00 5.08 256,392 0.44 4.96 0.44 4.96
1.00 5.59 207,615 0.42 5.45 0.42 5.45
1.00 3.89 157,140 0.42 3.81 0.42 3.81
$1.00 4.91% $ 89,497 0.67 4.80% 0.92% 4.54%
1.00 5.05 8,932 0.59 4.95 0.72 4.82
1.00 4.82 5,093 0.69 4.71 0.69 4.71
1.00 5.33 3,002 0.67 5.18 0.67 5.18
1.00 3.63 2,739 0.67 3.62 0.67 3.62
- ------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
69
<PAGE>
Financial Highlights
For a Share Outstanding for the Years Ended December 31,
<TABLE>
<CAPTION>
Net Asset Realized Dividends Distributions
Value Net and Unrealized from Net from
Beginning Investment Gains on Investment Capital
of Period Income Securities Income Gains
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Money Market Fund
- -------------------------------------------------------------------------------------------------------------------
Common Share Class
1998 $1.00 $0.05 $0.00 $(0.05) $0.00
1997 1.00 0.05 0.00 (0.05) 0.00
1996 1.00 0.05 0.00 (0.05) 0.00
1995 1.00 0.06 0.00 (0.06) 0.00
1994 1.00 0.04 0.00 (0.04) 0.00
Investor Share Class
1998 $1.00 $0.05 $0.00 $(0.05) $0.00
1997 1.00 0.05 0.00 (0.05) 0.00
1996 1.00 0.05 0.00 (0.05) 0.00
1995 1.00 0.05 0.00 (0.05) 0.00
1994 1.00 0.04 0.00 (0.04) 0.00
- -------------------------------------------------------------------------------------------------------------------
Tax-Exempt Money Market Fund
- -------------------------------------------------------------------------------------------------------------------
Common Share Class
1998 $1.00 $0.03 $0.00 $(0.03) $0.00
1997 1.00 0.03 0.00 (0.03) 0.00
1996 1.00 0.03 0.00 (0.03) 0.00
1995 1.00 0.03 0.00 (0.03) 0.00
1994 1.00 0.02 0.00 (0.02) 0.00
Investor Share Class
1998 $1.00 $0.03 $0.00 $(0.03) $0.00
1997 1.00 0.03 0.00 (0.03) 0.00
1996 1.00 0.03 0.00 (0.03) 0.00
1995 1.00 0.03 0.00 (0.03) 0.00
1994 1.00 0.02 0.00 (0.02) 0.00
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
70
<PAGE>
December 31, 1998
<TABLE>
<CAPTION>
Ratio of Net
Investment
Ratio of Net Ratio of Expenses Income
Ratio of Investment to Average to Average
Net Asset Net Assets Expenses Income Net Assets Net Assets
Value End Total End of to Average to Average (Excluding (Excluding
of Period Return Period (000) Net Assets Net Assets Waivers) Waivers)
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------
$1.00 5.33% $941,295 0.33% 5.21% 0.56% 4.98%
1.00 5.41 737,736 0.32 5.29 0.56 5.05
1.00 5.13 598,715 0.43 5.02 0.58 4.87
1.00 5.64 475,688 0.41 5.50 0.56 5.35
1.00 3.97 460,583 0.41 3.93 0.56 3.78
$1.00 4.97% $219,576 0.69% 4.85% 1.06% 4.48%
1.00 5.12 1,282 0.59 5.00 0.85 4.74
1.00 4.87 1,466 0.68 4.77 0.83 4.62
1.00 5.38 1,358 0.66 5.22 0.81 5.07
1.00 3.71 605 0.66 4.13 0.81 3.98
- ------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------
$1.00 3.21% $272,834 0.35% 3.17% 0.56% 2.95%
1.00 3.36 250,260 0.33 3.32 0.57 3.08
1.00 3.14 187,629 0.40 3.10 0.56 2.94
1.00 3.49 167,945 0.41 3.44 0.56 3.29
1.00 2.50 161,054 0.43 2.52 0.59 2.36
$1.00 2.96% $ 67,480 0.60% 2.92% 1.06% 2.45%
1.00 3.10 2,978 0.58 3.07 0.89 2.76
1.00 2.88 2,807 0.65 2.85 0.81 2.69
1.00 3.24 3,244 0.66 3.19 0.81 3.04
1.00 2.24 4,204 0.68 2.31 0.84 2.15
- ------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
71
<PAGE>
Financial Highlights
For a Share Outstanding Years Ended December 31,
<TABLE>
<CAPTION>
Net Asset Realized Dividends Distributions
Value Net and Unrealized from Net from
Beginning Investment Gains (Losses) Investment Capital
of Period Income on Securities Income Gains
- ----------------------------------------------------------------------------------------------------------
Fixed Income Fund
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Common Share Class
1998 $10.35 $0.57 $ 0.16 $(0.59) $(0.13)
1997 10.06 0.60 0.30 (0.60) (0.01)
1996 10.32 0.59 (0.26) (0.59) 0.00
1995 9.30 0.59 1.02 (0.59) 0.00
1994 10.23 0.54 (0.93) (0.54) 0.00
Investor Share Class
1998 $10.38 $0.53 $ 0.17 $(0.54) $(0.13)
1997 10.09 0.59 0.29 (0.58) (0.01)
1996 10.35 0.57 (0.26) (0.57) 0.00
1995 9.32 0.55 1.04 (0.56) 0.00
1994 10.24 0.50 (0.90) (0.52) 0.00
- ----------------------------------------------------------------------------------------------------------
Intermediate Government Fixed Income Fund
- ----------------------------------------------------------------------------------------------------------
Common Share Class
1998 $10.04 $0.52 $ 0.28 $(0.52) $ 0.00
1997 9.85 0.56 0.19 (0.56) 0.00
1996 10.06 0.54 (0.21) (0.54) 0.00
1995 9.33 0.54 0.73 (0.54) 0.00
1994 10.08 0.47 (0.75) (0.47) 0.00
Investor Share Class
1998 $10.04 $0.47 $ 0.27 $(0.47) $ 0.00
1997 9.85 0.57 0.16 (0.54) 0.00
1996 10.05 0.49 (0.18) (0.51) 0.00
1995 9.32 0.49 0.76 (0.52) 0.00
1994 10.07 0.43 (0.73) (0.45) 0.00
- ----------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
72
<PAGE>
DECEMBER 31, 1998
<TABLE>
<CAPTION>
Ratio of Net
Investment
Ratio of Net Ratio of Expenses Income
Ratio of Investment to Average to Average
Net Asset Net Assets Expenses Income Net Assets Net Assets Portfolio
Value End Total End of to Average to Average (Excluding (Excluding Turnover
of Period Return Period (000) Net Assets Net Assets Waivers) Waivers) Rate
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$10.36 7.13% $171,753 0.72% 5.43% 0.86% 5.28% 157%
10.35 9.22 141,148 0.71 5.95 0.81 5.85 233
10.06 3.42 123,930 0.73 5.92 0.83 5.82 194
10.32 17.75 125,563 0.74 5.97 0.84 5.87 59
9.30 (3.82) 92,402 0.72 5.45 0.82 5.35 126
$10.41 6.81% $ 436 1.18% 4.97% 1.32% 4.82% 157%
10.38 8.92 428 0.96 5.71 1.12 5.55 233
10.09 3.24 459 0.98 5.65 1.08 5.55 194
10.35 17.40 646 0.99 5.72 1.09 5.62 59
9.32 (3.97) 442 0.98 5.38 1.08 5.28 126
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
$10.32 8.16% $ 43,062 0.81% 5.04% 0.95% 4.90% 106%
10.04 7.93 51,934 0.71 5.69 0.81 5.59 283
9.85 3.51 56,895 0.74 5.38 0.84 5.28 179
10.06 13.86 73,466 0.73 5.48 0.83 5.38 115
9.33 (2.78) 91,002 0.74 4.88 0.84 4.78 124
$10.31 7.56% $ 63 1.26% 4.59% 1.40% 4.45% 106%
10.04 7.66 104 0.96 5.44 1.10 5.30 283
9.85 3.30 251 0.99 4.87 1.09 4.77 179
10.05 13.59 2,946 0.98 5.18 1.08 5.08 115
9.32 (3.03) 1,133 1.02 5.05 1.12 4.95 124
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
73
<PAGE>
Financial Highlights
For a Share Outstanding for the Years Ended December 31,
<TABLE>
<CAPTION>
Net Asset Realized Dividends Distributions
Value Net and Unrealized from Net from
Beginning Investment Gains (Losses) Investment Capital
of Period Income on Securities Income Gains
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Tax-Exempt Fixed Income Fund
- -------------------------------------------------------------------------------------------------------------------
Common Share Class
1998 $10.41 $0.47 $ 0.12 $(0.47) $ 0.00
1997 9.99 0.49 0.42 (0.49) 0.00
1996 10.20 0.50 (0.21) (0.50) 0.00
1995 9.26 0.48 0.94 (0.48) 0.00
1994 10.23 0.44 (0.94) (0.44) (0.03)
Investor Share Class
1998 $10.39 $0.42 $ 0.12 $(0.42) $ 0.00
1997 9.97 0.47 0.41 (0.46) 0.00
1996 10.18 0.43 (0.17) (0.47) 0.00
1995 9.24 0.43 0.97 (0.46) 0.00
1994 10.22 0.40 (0.93) (0.42) (0.03)
- -------------------------------------------------------------------------------------------------------------------
International Fixed Income Fund
- -------------------------------------------------------------------------------------------------------------------
Common Share Class
1998 $ 9.64 $0.39 $ 1.07 $(0.18) $(0.10)
1997 10.24 0.43 (1.03) 0.00 0.00
1996 10.58 0.48 (0.18) (0.64) 0.00
1995 9.54 0.62 1.38 (0.96) 0.00
1994 10.43 0.56 (0.72) (0.55) (0.18)
Investor Share Class
1998 $ 9.60 $0.38 $ 1.05 $(0.13) $(0.10)
1997 10.23 0.49 (1.12) 0.00 0.00
1996 10.56 0.54 (0.27) (0.60) 0.00
1995 9.53 0.52 1.45 (0.94) 0.00
1994 10.42 0.46 (0.64) (0.53) (0.18)
</TABLE>
The accompanying notes are an integral part of the financial statements.
74
<PAGE>
December 31, 1998
<TABLE>
<CAPTION>
Ratio of Net
Investment
Ratio of Net Ratio of Expenses Income (Loss)
Ratio of Investment to Average to Average
Net Asset Net Assets Expenses Income Net Assets Net Assets Portfolio
Value End Total End of to Average to Average (Excluding (Excluding Turnover
of Period Return Period (000) Net Assets Net Assets Waivers) Waivers) Rate
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------
$10.53 5.79% $35,161 0.83% 4.44% 0.97% 4.30% 41%
10.41 9.36 40,441 0.73 4.84 0.84 4.73 54
9.99 2.96 39,756 0.73 4.95 0.85 4.83 98
10.20 15.67 50,079 0.75 4.84 0.87 4.72 129
9.26 (4.93) 53,588 0.71 4.54 0.84 4.41 146
$10.51 5.31% $ 562 1.29% 3.98% 1.43% 3.84% 41%
10.39 9.11 537 0.98 4.59 1.14 4.43 54
9.97 2.70 680 0.98 4.70 1.10 4.58 98
10.18 15.43 1,131 1.00 4.59 1.12 4.47 129
9.24 (5.27) 1,059 0.97 4.35 1.10 4.22 146
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
$10.82 15.15% $17,482 1.38% 3.62% 1.42% 3.57% 79%
9.64 (5.86) 15,574 1.22 4.08 1.22 4.08 52
10.24 2.82 17,561 1.11 4.66 1.11 4.66 85
10.58 20.99 17,433 1.10 5.86 1.16 5.80 105
9.54 (1.47) 15,021 1.16 5.09 1.22 5.03 138
$10.80 14.84% $ 53 1.83% 3.17% 1.87% 3.12% 79%
9.60 (6.16) 68 1.47 3.83 1.51 3.78 52
10.23 2.62 112 1.36 4.43 1.36 4.43 85
10.56 20.68 125 1.35 5.57 1.41 5.51 105
9.53 (1.71) 87 1.41 5.03 7.54 (1.10) 138
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
75
<PAGE>
Financial Highlights
For a Share Outstanding for the Years Ended December 31,
<TABLE>
<CAPTION>
Net Asset Realized Dividends Distributions
Value Net and Unrealized from Net from
Beginning Investment Gains (Losses) Investment Capital
of Period Income on Securities Income Gains
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Balanced Fund
- -------------------------------------------------------------------------------------------------------------------
Common Share Class
1998 $12.73 $0.27 $ 0.82 $(0.27) $(1.72)
1997 10.98 0.32 2.06 (0.32) (0.31)
1996 10.75 0.35 1.02 (0.35) (0.79)
1995 9.53 0.39 1.65 (0.39) (0.43)
1994 10.04 0.30 (0.50) (0.30) (0.01)
Investor Share Class
1998 $12.73 $0.21 $ 0.85 $(0.21) $(1.72)
1997 10.98 0.30 2.06 (0.30) (0.31)
1996 10.75 0.30 1.04 (0.32) (0.79)
1995 9.53 0.34 1.67 (0.36) (0.43)
1994 10.03 0.27 (0.49) (0.27) (0.01)
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
76
<PAGE>
December 31, 1998
<TABLE>
<CAPTION>
Ratio of Net
Investment
Ratio of Net Ratio of Expenses Income
Ratio of Investment to Average to Average
Net Asset Net Assets Expenses Income Net Assets Net Assets Portfolio
Value End Total End of to Average to Average (Excluding (Excluding Turnover
of Period Return Period (000) Net Assets Net Assets Waivers) Waivers) Rate
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------------------
$11.83 9.97% $75,793 1.03% 2.06% 1.03% 2.06% 84%
12.73 22.10 68,523 0.93 2.68 0.93 2.68 111
10.98 13.15 54,546 0.94 3.14 0.94 3.14 104
10.75 21.85 49,899 0.92 3.74 0.92 3.74 85
9.53 (2.11) 72,086 0.94 3.11 0.94 3.11 85
$11.86 9.72% $ 3,657 1.49% 1.60% 1.49% 1.60% 84%
12.73 21.80 4,157 1.18 2.43 1.24 2.37 111
10.98 12.86 3,710 1.19 2.89 1.19 2.89 104
10.75 21.52 3,949 1.22 3.36 1.22 3.36 85
9.53 (2.29) 2,894 1.24 2.86 1.34 2.76 85
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
77
<PAGE>
Financial Highlights
For a Share Outstanding for the Years Ended December 31,
<TABLE>
<CAPTION>
Net Asset Realized Dividends Distributions
Value Net and Unrealized from Net from
Beginning Investment Gains (Losses) Investment Capital
of Period Income (Loss) on Securities Income Gains
- ----------------------------------------------------------------------------------------------------------
Value Fund
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Common Share Class
1998 $16.51 $ 0.19 $ 0.86 $(0.19) $(5.04)
1997 13.24 0.24 3.75 (0.24) (0.48)
1996 12.26 0.29 2.18 (0.29) (1.20)
1995 9.79 0.34 2.74 (0.35) (0.26)
1994 10.30 0.35 (0.35) (0.34) (0.17)
Investor Share Class
1998 $16.54 $ 0.12 $ 0.82 $(0.12) $(5.04)
1997 13.26 0.20 3.76 (0.20) (0.48)
1996 12.28 0.25 2.18 (0.25) (1.20)
1995 9.80 0.32 2.74 (0.32) (0.26)
1994 10.30 0.31 (0.33) (0.31) (0.17)
- ----------------------------------------------------------------------------------------------------------
Growth Fund
- ----------------------------------------------------------------------------------------------------------
Common Share Class
1998 $14.57 $ 0.00 $ 4.20 $(0.02) $(1.65)
1997 13.06 0.12 2.97 (0.12) (1.46)
1996 11.61 0.17 2.31 (0.17) (0.86)
1995 9.73 0.16 2.88 (0.16) (1.00)
1994 10.21 0.16 (0.36) (0.16) (0.12)
Investor Share Class
1998 $14.60 $(0.07) $ 4.18 $ 0.00 $(1.65)
1997 13.09 0.08 2.97 (0.08) (1.46)
1996 11.62 0.14 2.33 (0.14) (0.86)
1995 9.74 0.12 2.89 (0.13) (1.00)
1994 10.23 0.13 (0.37) (0.13) (0.12)
- ----------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
78
<PAGE>
DECEMBER 31, 1998
<TABLE>
<CAPTION>
Ratio of Net
Investment
Ratio of Net Ratio of Expenses Income (Loss)
Ratio of Investment to Average to Average
Net Asset Net Assets Expenses Income (Loss) Net Assets Net Assets Portfolio
Value End Total End of to Average to Average (Excluding (Excluding Turnover
of Period Return Period (000) Net Assets Net Assets Waivers) Waivers) Rate
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$12.33 5.47% $170,945 1.05% 1.23% 1.05% 1.23% 55%
16.51 30.49 220,618 1.01 1.57 1.01 1.57 79
13.24 20.43 164,710 1.03 2.19 1.03 2.19 58
12.26 32.02 131,243 1.05 3.07 1.05 3.07 37
9.79 0.00 61,557 1.06 3.45 1.06 3.45 38
$12.32 4.66% $ 1,624 1.50% 0.78% 1.50% 0.78% 55%
16.54 30.20 1,965 1.26 1.32 1.32 1.26 79
13.26 20.09 1,672 1.28 1.94 1.28 1.94 58
12.28 31.72 1,497 1.33 2.79 1.33 2.79 37
9.80 (0.21) ,731 1.37 3.13 1.37 3.13 38
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
$17.10 30.23% $184,601 1.06% 0.01% 1.06% 0.01% 65%
14.57 23.98 132,649 1.02 0.79 1.02 0.79 62
13.06 21.69 95,215 1.02 1.36 1.02 1.36 58
11.61 31.60 78,216 1.02 1.37 1.02 1.37 71
9.73 (2.05) 82,710 1.02 1.58 1.03 1.57 68
$17.06 29.52% $ 3,533 1.52% (0.45)% 1.52% (0.45)% 65%
14.60 23.65 3,485 1.27 0.54 1.33 0.48 62
13.09 21.41 3,031 1.27 1.11 1.27 1.11 58
11.62 31.29 2,681 1.31 1.10 1.31 1.10 71
9.74 (2.42) 1,530 1.33 1.30 1.33 1.30 68
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
79
<PAGE>
Financial Highlights
For a Share Outstanding for the Years Ended December 31,
<TABLE>
<CAPTION>
Net Asset Realized Divdends Distributions
Value Net and Unrealized from Net from Contribution
Beginning Investment Gains (Losses) Investment Capital (Return)
Of Period Income (Loss) on Securities Income Gains of Capital
- ------------------------------------------------------------------------------------------------------------------------------------
International Equity Fund
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Common Share Class
1998 $15.38 $ 0.01 $ 3.85 $(0.09) $(0.18) $0.00
1997 15.83 0.04 0.68 (0.08) (1.09) 0.00
1996 14.56 0.06 1.37 (0.04) (0.15) 0.03
1995 13.00 0.07 1.75 (0.06) (0.20) 0.00
1994 12.59 0.02 0.40 0.00 (0.01) 0.00
Investor Share Class
1998 $15.34 $(0.08) $ 3.86 $(0.03) $(0.18) $0.00
1997 15.79 0.01 0.66 (0.03) (1.09) 0.00
1996 14.52 0.04 1.35 0.00 (0.15) 0.03
1995 12.96 0.05 1.73 (0.02) (0.20) 0.00
1994 12.58 0.02 0.37 0.00 (0.01) 0.00
- ------------------------------------------------------------------------------------------------------------------------------------
Small Cap Growth Fund
- ------------------------------------------------------------------------------------------------------------------------------------
Common Share Class
1998 $13.38 $(0.11) $(0.82) $ 0.00 $(0.23) $0.00*
1997 13.03 (0.09) 2.07 0.00 (1.63) 0.00
1996 12.46 (0.03) 2.38 0.00 (1.78) 0.00
1995 9.57 0.02 3.05 (0.02) (0.16) 0.00
1994 10.24 0.03 (0.67) (0.03) 0.00 0.00
Investor Share Class
1998 $13.29 $(0.10) $(0.92) $ 0.00 $(0.23) $0.00*
1997 13.00 (0.13) 2.05 0.00 (1.63) 0.00
1996 12.46 (0.07) 2.39 0.00 (1.78) 0.00
1995 9.58 (0.01) 3.05 0.00 (0.16) 0.00
1994 10.25 0.00 (0.67) 0.00 0.00 0.00
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
*Per share was less than $0.005.
The accompanying notes are an integral part of the financial statements.
80
<PAGE>
DECEMBER 31, 1998
<TABLE>
<CAPTION>
Ratio of Net
Investment
Ratio of Net Ratio of Expenses Income (Loss)
Ratio of Investment to Average to Average
Net Asset Net Assets Expenses Income (Loss) Net Assets Net Assets Portfolio
Value End Total End of to Average to Average (Excluding) (Excluding Turnover
of Period Return Period (000) Net Assets Net Assets Waivers) Waivers) Rate
- ----------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$18.97 25.43% $142,862 1.38% 0.02% 1.38% 0.02% 31%
15.38 4.56 85,440 1.35 0.23 1.35 0.23 17
15.83 10.09(A) 96,442 1.36 0.44 1.36 0.44 9
14.56 14.03 77,519 1.38 0.70 1.38 0.70 11
13.00 3.32 41,324 1.43 0.21 1.46 0.18 6
$18.91 24.87% $ 1,015 1.83% (0.43)% 1.83% (0.43)% 31%
15.34 4.28 1,245 1.60 (0.05) 1.65 (0.10) 17
15.79 9.85(A) 1,608 1.61 0.20 1.61 0.20 9
14.52 13.79 1,686 1.68 0.42 1.68 0.42 11
12.96 3.08 1,179 1.73 0.03 2.22 (0.46) 6
- ----------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------
$12.22 (6.52)% $ 45,899 1.17% (0.84)% 1.17% (0.84)% 151%
13.38 15.89 41,945 1.04 (0.72) 1.04 (0.72) 170
13.03 19.42 36,375 1.05 (0.27) 1.05 (0.27) 158
12.46 32.13 23,844 1.10 0.18 1.10 0.18 142
9.57 (6.27) 31,527 1.06 0.27 1.06 0.27 43
$12.04 (7.25)% $ 874 1.63% (1.30)% 1.63% (1.30)% 151%
13.29 15.45 552 1.29 (0.97) 1.35 (1.03) 170
13.00 19.18 579 1.30 (0.52) 1.30 (0.52) 158
12.46 31.73 553 1.39 (0.08) 1.39 (0.08) 142
9.58 (6.54) 294 1.38 0.02 1.38 0.02 43
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
(A) The total return for the period ended December 31, 1996 includes the effect
of a capital contribution from an affiliate of the Advisor. Without the
capital contribution, the total return for the Common Class and the
Investor Class would have been 9.87% and 9.64%, respectively.
The accompanying notes are an integral part of the financial statements.
81
<PAGE>
Financial Highlights
For a Share Outstanding for the Years Ended December 31,
<TABLE>
<CAPTION>
Net Asset Realized Dividends Distributions
Value Net and Unrealized from Net from Contribution
Beginning Investment Gains (Losses) Investment Capital (Return)
of Period Income Securities Income Gains of Capital
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Real Estate Fund
- -----------------------------------------------------------------------------------------------------------------------------------
COMMON SHARE CLASS
1998 $ 9.95 $ 0.37 $(1.58) $(0.31) $ 0.00 $(0.06)
1997(1) 10.00 0.00 (0.05) 0.00 0.00 0.00
INVESTOR SHARE CLASS
1998(2) $10.00 $ 0.08 $ 0.66 $(0.11) $ 0.00 $ 0.00*
- -----------------------------------------------------------------------------------------------------------------------------------
Asian Tigers Fund
- -----------------------------------------------------------------------------------------------------------------------------------
COMMON SHARE CLASS
1998 $ 7.60 $ 0.07 $(0.93) $(0.01) $ 0.00 $ 0.00
1997 11.91 0.04 (4.32) (0.02) (0.01) 0.00
1996 10.45 0.02 1.48 (0.04) (0.02) 0.02
1995 9.47 0.12 0.98 (0.12) 0.00 0.00
1994(3) 10.00 0.03 (0.53) (0.02) (0.01) 0.00
INVESTOR SHARE CLASS
1998 $ 7.57 $ 0.04 $(0.94) $ 0.00 $ 0.00 $ 0.00
1997 11.89 0.05 (4.36) 0.00 (0.01) 0.00
1996 10.44 (0.02) 1.48 (0.01) (0.02) 0.02
1995 9.47 0.11 0.95 (0.09) 0.00 0.00
1994(4) 10.00 0.01 (0.53) 0.00 (0.01) 0.00
- -----------------------------------------------------------------------------------------------------------------------------------
Latin America Equity Fund
- -----------------------------------------------------------------------------------------------------------------------------------
COMMON SHARE CLASS
1998 $13.13 $ 0.18 $(4.96) $(0.15) $(0.08) $ 0.00
1997 10.24 0.05 3.54 (0.03) (0.67) 0.00
1996(5) 10.00 (0.02) 0.26 0.00 0.00 0.00
- -----------------------------------------------------------------------------------------------------------------------------------
Small Cap Value Fund
- -----------------------------------------------------------------------------------------------------------------------------------
COMMON SHARE CLASS
1998(6) $10.00 $ 0.01 $(1.28) $(0.01) $ 0.00 $ 0.00*
INVESTOR SHARE CLASS
1998(6) $10.00 $(0.01) $(1.44) $(0.01) $ 0.00 $ 0.00*
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Per share was less than $0.005.
1. Commenced operations on December 31, 1997. All ratios except the total
return for the period have been annualized.
2. Commenced operations on October 8, 1998. All ratios except the total
return for the period have been annualized.
3. Commenced operations on January 3, 1994. All ratios and the total return
for the period have been annualized.
4. Commenced operations on January 12, 1994. All ratios and the total return
for the period have been annualized.
5. Commenced operations on July 1, 1996. All ratios and the total return for
the period have been annualized.
6. Commenced operations on June 30, 1998. All ratios except the total return
for the period have been annualized.
The accompanying notes are an integral part of the financial statements.
82
<PAGE>
Financial Highlights
For a Share Outstanding for the Years Ended December 31,
<TABLE>
<CAPTION>
Ratio of Net Ratio of Expenses Income (Loss)
Ratio of Investment to Average to Average
Net Asset Net Assets Expenses Income (Loss) Net Assets Net Assets Portfolio
Value End Total End of to Average to Average (Excluding (Excluding Turnover
of Period Return Period (000) Net Assets Net Assets Waivers) Waivers) Rate
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Real Estate Fund
- ------------------------------------------------------------------------------------------------------------------------------------
COMMON SHARE CLASS
1998 $ 8.37 (12.35)% $ 7,022 1.41% 4.68% 1.78% 4.31% 13%
1997(1) 9.95 0.00 2,985 1.31 (1.31) 1.61 (1.61) 0*
INVESTOR SHARE CLASS
1998(2) $10.63 7.35% $ 21 1.91% 4.18% 2.28% 3.81% 13%*
- -----------------------------------------------------------------------------------------------------------------------------------
Asian Tigers Fund
- -----------------------------------------------------------------------------------------------------------------------------------
COMMON SHARE CLASS
1998 $ 6.73 (11.37)% $28,202 1.67% 0.91% 1.67% 0.91% 57%
1997 7.60 (35.98) 34,664 1.60 0.50 1.60 0.50 42
1996 11.91 14.55(B) 33,602 1.54 0.23 1.54 0.23 24
1995 10.45 11.61 23,145 1.52 1.38 1.60 1.30 28
1994(3) 9.47 (5.07) 17,860 1.60 0.45 1.71 0.34 13*
INVESTOR SHARE CLASS
1998 $ 6.67 (11.89)% $ 178 2.11% 0.47% 2.11% 0.47% 57%
1997 7.57 (36.25) 334 1.85 0.30 1.89 0.26 42
1996 11.89 14.21(B) 840 1.79 (0.15) 1.79 (0.15) 24
1995 10.44 11.18 733 1.81 1.05 1.88 0.98 28
1994(4) 9.47 (5.37) 705 1.90 0.15 2.75** (0.70)** 13*
- -----------------------------------------------------------------------------------------------------------------------------------
Latin America Equity Fund
- -----------------------------------------------------------------------------------------------------------------------------------
COMMON SHARE CLASS
1998 $ 8.12 (36.33)% $17,993 1.75% 1.38% 1.75% 1.38% 92%
1997 13.13 35.50 33,271 1.50 0.56 1.50 0.56 45
1996(5) 10.24 2.40 11,490 2.09 (0.55) 2.09 (0.55) 10*
- -----------------------------------------------------------------------------------------------------------------------------------
Small Cap Value Fund
- -----------------------------------------------------------------------------------------------------------------------------------
COMMON SHARE CLASS
1998(6) $ 8.72 (12.68)% $8,295 1.53% 0.20% 1.61% 0.12% 54%*
INVESTOR SHARE CLASS
1998(6) $ 8.54 (14.53)% $ 324 2.03% (0.30)% 2.11% (0.38)% 54%*
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Not Annualized.
** Ratios are high relative to subsequent years as a result of the low initial
asset levels during the Investor Share Class' initial year of operations.
(B) The total return for the period ended December 31, 1996 includes the effect
of a capital contribution from an affiliate of the Advisor.
Without the capital contribution, the total return for the Common Class and
Investor Class would have been 14.36% and 14.02 %, respectively.
The accompanying notes are an integral part of the financial statements.
83
<PAGE>
Notes to Financial Statements
1. Organization
ABN Amro Funds (the "Trust"), formerly the Rembrandt Funds, was organized as a
Massachusetts business trust under a Declaration of Trust dated September 17,
1992. The Trust is registered under the Investment Company Act of 1940, as
amended (the "1940 Act"), as an open-end management investment company with 19
funds: Treasury Money Market Fund, Government Money Market Fund, Money Market
Fund, Tax-Exempt Money Market Fund (collectively "the Money Market Funds"),
Fixed Income Fund, Intermediate Government Fixed Income Fund, Tax-Exempt Fixed
Income Fund, International Fixed Income Fund, Balanced Fund, Limited Volatility
Fixed Income Fund (collectively "the Fixed Income Funds"), Value Fund, Growth
Fund, International Equity Fund, Small Cap Growth Fund, Real Estate Fund,
TransEurope Fund, Asian Tigers Fund, Latin America Equity Fund and Small Cap
Value Fund (collectively "the Equity Funds")(all funds collectively "the
Funds"). The Limited Volatility Fixed Income Fund and TransEurope Fund had not
yet commenced operations as of December 31, 1998. The Trust prospectuses
describe each Fund's investment objectives, policies and strategies. The Small
Cap Value Fund is offered through two prospectuses, one for each class of
shares.
The assets of each Fund are segregated, and a shareholder's interest is
limited to the Fund in which shares are held. The Trust offers two classes of
shares: Common Share Class, previously the Trust Class, and Investor Share
Class.
2. Significant Accounting Policies
The following is a summary of the significant accounting policies followed by
the Funds.
Security Valuation--Investments in equity securities that are traded on a
national securities exchange (or reported on NASDAQ national market system) are
stated at the last quoted sales price, for the principal exchange, 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 for the principal exchange was reported on that date are
stated at the last quoted bid price. Debt obligations exceeding 60 days to
maturity for which market quotations are readily available are valued at the
most recently quoted bid price. Debt obligations with 60 days or less until
maturity may be valued at their amortized cost. Foreign securities are valued
based upon quotations as of the time of the net asset value calculation. The
value of securities for which no quotations are readily available (including
restricted securities that are not deemed to be liquid) is determined in good
faith at fair value under the supervision of the Board of Trustees.
Investment securities held by the Money Market Funds are stated at
amortized cost which approximates market value. Under the amortized cost method,
any discount or premium is accreted or amortized ratably to the maturity of the
security and is included in interest income.
Federal Income Taxes--It is each Fund's intention to qualify as a regulated
investment company for federal income tax purposes by complying with the
appropriate provisions of Subchapter M of the Internal Revenue Code of 1986, as
amended. Accordingly, no provisions for federal income taxes are required in the
accompanying 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
recognized on an accrual basis. Costs used in determining realized gains and
losses on the sales of investment securities are those of the specific
securities sold, adjusted for the accretion and amortization of purchase
discounts and premiums during the respective holding periods. Purchase discounts
and premiums on securities held by the Equity and Fixed Income Funds are
accreted and amortized to maturity using the interest method, which approximates
the effective interest method.
Securities purchased or sold on a when-issued or delayed-delivery basis may
be settled a month or more after the trade date; interest income is not accrued
until settlement date. Each Fund instructs the custodian to segregate assets
with a current value at least equal to the amount of its when-issued purchase
commitments.
Repurchase Agreements--Securities pledged as collateral for repurchase
agreements are held by the custodian bank until the respective agreements
mature. Provisions of the repurchase agreements ensure that the market value of
the collateral, including accrued interest thereon, is sufficient in the event
of default by the counterparty. If the counterparty defaults and the value of
the collateral declines or if the counterparty enters an insolvency proceeding,
realization of the collateral by the Funds may be delayed or limited.
Net Asset Value Per Share--The net asset value per share of each Fund or
class of shares is calculated each business day. In general, it is computed by
dividing the assets of each Fund or class of shares less its liabilities, by the
number of outstanding shares of the Fund or class.
Foreign Currency Translations--The books and records for the International
Fixed Income Fund, Asian Tigers Fund, International Equity Fund and Latin
America Equity Fund (the "International Funds") are maintained in U.S. dollars.
Foreign currency amounts are translated into U.S. dollars on the following
basis:
(i) market value of investment securities, assets and liabilities at the
current rate of exchange; and
(ii) purchases and sales of investment securities, income, and expenses at
the relevant rates of exchange prevailing on the respective dates of
such transactions.
84
<PAGE>
December 31, 1998
For foreign equity securities, the International Funds do not isolate the
portion of gains and losses on investments in equity securities that is due to
changes in the foreign exchange rates from that which is due to changes in
market prices of equity securities.
The International Funds do isolate the effect of fluctuations in foreign
currency rates when determining the gain or loss upon sale or maturity of
foreign currency denominated debt obligations for federal income tax purposes.
The International Funds report certain foreign currency-related
transactions as components of realized gains for financial reporting purposes,
whereas such components are treated as ordinary income for federal income tax
purposes.
Forward Foreign Currency Contracts--The International Funds may enter into
forward foreign currency contracts as hedges against fund positions. The
aggregate principal amounts of the contracts are not recorded as the Fund
intends to settle the contracts prior to delivery. All commitments are
"marked-to-market" daily at the applicable foreign exchange rate and any
resulting unrealized gains or losses are recorded currently. Gains or losses on
the purchase or sale of forward foreign currency contracts having the same
settlement date and broker are recognized on the date of offset, otherwise gains
or losses are recognized on the settlement date.
The use of forward foreign currency contracts does not eliminate the
fluctuations in the underlying prices of a Fund's securities, but it does
establish a rate of exchange that can be achieved in the future. Although
forward foreign currency contracts limit the risk of loss due to a decline in
the value of the hedged currency, they also limit any potential gain that might
result should the value of the currency increase. In addition, each Fund could
be exposed to risks if the counterparties to the contracts are unable to meet
the terms of their contracts.
Maturity Dates--Certain variable rate and floating rate securities of the
Funds are subject to "maturity shortening" devices such as put or demand
features. Under Rule 2a-7 of the 1940 Act, these securities are deemed to have
maturities shorter than the ultimate maturity dates. Accordingly, the maturity
dates reflected in the Schedule of Investments are the shorter of the effective
put/demand date or the ultimate maturity date.
Classes--Class-specific expenses are borne by that class. Income, expenses,
and realized and unrealized gains/losses are allocated to the respective classes
on the basis of relative daily net assets.
Expenses--Expenses that are directly related to one of the Funds are
charged directly to that Fund. Other operating expenses of the Fund are prorated
to the Funds on the basis of relative net assets.
Use of Estimates--The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the amounts reported in the financial
statements and accompanying notes. Actual results could differ from those
estimates.
Other--Dividends from net investment income for the Equity and Fixed Income
Funds are paid to shareholders on a periodic basis. Dividends from net
investment income for the Money Market Funds are declared to shareholders daily
and distributed monthly. Any net realized capital gains on sales of securities
are distributed to shareholders at least annually.
The amounts of dividends from net investment income and distributions from
net realized capital gains are determined in accordance with federal income tax
regulations, which may differ from those amounts recorded under generally
accepted accounting principles. These book/tax differences are either temporary
or permanent in nature. To the extent that these differences are permanent, they
are charged or credited to paid-in capital in the period that the difference
arises.
Due to the nature of the dividends that the Real Estate Fund receives from
REIT's, the Real Estate Fund anticipates it may have a tax basis return of
capital.
3. Administration and Distribution Agreements
Effective July 1, 1998, the Trust and ABN AMRO Fund Service, Inc. (the
"Administrator") entered into an administration agreement (the "Administration
Agreement"). Under the terms of the Administration Agreement, the Administrator
is entitled to a fee calculated daily and paid monthly at an annual rate .15% of
the average daily net assets of each Fund. The Administrator has agreed to
voluntarily waive a portion of its fee for certain Funds, for an indefinite
period of time. The Administrator may in its sole discretion terminate this
waiver at any time.
From March 1, 1998 to July 1, 1998, First Data Investor Services Group,
Inc. ("Investor Services Group") provided administrative services to the Funds
and voluntarily waived a portion of its fee for certain Funds. Prior to March 1,
1998, SEI Fund Resources provided administrative services to the Funds and
voluntarily waived a portion of its fee for certain Funds.
Investor Services Group provides fund accounting and related services to
the Funds. Investor Services Group has agreed to voluntarily waive a portion of
its fee for certain Funds, for an indefinite period of time. Investor Services
Group may in its sole discretion terminate this waiver at any time.
First Data Distributors, Inc. (the "Distributor"), a wholly-owned
subsidiary of Investor Services Group and an indirect wholly-owned subsidiary of
First Data Corporation, serves as the distributor of the Funds. The Trust has a
distribution plan with respect to Investor Share Class. The Distributor is paid
a fee of .25% of the average daily net assets of the Investor
85
<PAGE>
Notes to Financial Statements (continued)
Share Class of each Fund. Prior to March 1, 1998, Rembrandt Financial Services
Company provided these distribution services to the Funds.
In addition, the Trust has a shareholder servicing plan with respect to
Investor Share Class. The Distributor is paid a fee of .25% of the average daily
net assets of the Investor Share Class of each Fund for its efforts in
maintaining client accounts, arranging bank wires, responding to client
inquiries concerning services provided on investment and assisting clients in
purchase, redemption and exchange transactions, and changing their dividend
options, account designations and addresses. For the current period, the
distributor has waived a portion of this fee for an indefinite period of time.
Prior to March 1, 1998, Rembrandt Financial Services Company provided these
services to the Investor Share Class of the Funds. For the period January 1,
1998 through February 28, 1998, Rembrandt Financial Services Company waived
$3,245 for the Government Money Market Fund and $759 for the Money Market Fund.
4. Organizational Costs and Transactions with Affiliates
Organizational costs have been capitalized by the Funds and are being amortized
over 60 months, commencing with operations. In the event any of the initial
shares are redeemed by any holder thereof during the period that the Fund is
amortizing its organizational costs, the redemption proceeds payable to the
holder thereof by the Fund 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 the redemption. These
costs include legal fees for organizational work performed by a law firm of
which two officers of the Trust are partners.
Certain officers of the Trust are also employees of the Administrator, Sub-
Administrator, Distributor and/or Advisor. Such officers are paid no fees by the
Trust for serving in their roles as officers of the Trust.
5. Investment Advisory Agreement
The Trust has entered into an investment advisory agreement with ABN AMRO Asset
Management (USA) Inc., (the "Advisor"), under which the Advisor is entitled to
an annual fee equal to .60% of the average daily net assets of each of the Fixed
Income, Intermediate Government Fixed Income, Limited Volatility Fixed Income
and Tax-Exempt Fixed Income Funds; .80% of the average daily net assets of each
of the International Fixed Income, Value, Growth, Small Cap Growth, and Small
Cap Value Funds; 1.00% of the average daily net assets of each of the Real
Estate, International Equity, TransEurope, Latin America Equity and Asian Tigers
Funds; .70% of the average daily net assets of the Balanced Fund; .35% of the
average daily net assets of each of the Treasury Money Market, Money Market, and
Tax-Exempt Money Market Funds, and .20% of the average daily net assets of the
Government Money Market Fund. The Advisor has voluntarily agreed for an
indefinite period of time, to waive a portion of its fee in an amount equal to
.10% of the average daily net assets of each of the Fixed Income Funds, except
the International Fixed Income Fund. The Advisor has also voluntarily agreed for
an indefinite period of time, to waive a portion of its fee in an amount equal
to .15% of the average daily net assets of each of the Money Market Funds,
except the Government Money Market Fund. The Advisor has also agreed to for an
indefinite period of time, to waive a portion of its fee in an amount equal to
.30% of the average daily net assets of the Real Estate Fund. This waiver can be
discontinued anytime. ABN AMRO-NSM International Funds Management B.V. has
entered into a sub-advisory agreement with the Advisor and serves as Sub-Advisor
to the International Funds. Sub-Advisory fees are paid by the Advisor.
6. Investment Transactions
The cost of security purchases and the proceeds from the sale of securities
excluding U.S. Government securities, and temporary cash investments, during the
year ended December 31, 1998 were as follows:
<TABLE>
<CAPTION>
Purchases Sales
(000) (000)
--------- --------
<S> <C> <C>
Fixed Income $ 90,008 $ 70,941
Intermediate Government
Fixed Income -- --
Tax-Exempt Fixed Income 14,880 21,535
International Fixed Income 13,302 13,325
Balanced 37,974 38,013
Value 108,845 174,380
Growth 108,866 99,426
International Equity 67,035 35,700
Small Cap Growth 78,382 70,904
Real Estate 5,109 561
Asian Tigers 15,876 16,847
Latin America Equity 25,832 27,439
Small Cap Value 11,897 2,724
</TABLE>
The cost of security purchases and the proceeds from the sale of U.S.
Government securities during the year ended December 31, 1998 were as follows:
<TABLE>
<CAPTION>
Purchases Sales
(000) (000)
--------- --------
<S> <C> <C>
Fixed Income $190,518 $181,691
Intermediate Government
Fixed Income 49,790 59,929
Tax-Exempt Fixed Income -- --
International Fixed Income -- --
Balanced 26,025 24,019
Value -- --
Growth -- --
International Equity -- --
Small Cap Growth -- --
Real Estate -- --
Asian Tigers -- --
Latin America Equity -- --
Small Cap Value -- --
</TABLE>
<PAGE>
DECEMBER 31, 1998
The aggregate gross unrealized appreciation and depreciation, net
unrealized appreciation and depreciation, and cost for all securities as
computed on a Federal income tax basis, at December 31, 1998 for each Fund is as
follows:
<TABLE>
<CAPTION>
Net
Gross Gross Unrealized
Appreciated (Depreciated) Appreciation
Securities Securities (Depreciation) Cost
(000) (000) (000) (000)
------------------------------------------------------
<S> <C> <C> <C> <C>
Fixed Income $ 2,321 $ (263) $ 2,058 $170,630
Intermediate
Government
Fixed Income 954 (25) 929 42,092
Tax-Exempt Fixed
Income 2,130 (8) 2,122 33,399
International Fixed
Income 1,310 (82) 1,228 15,484
Balanced 15,433 (3,451) 11,982 67,740
Value 20,683 (11,040) 9,643 168,319
Growth 59,795 (3,460) 56,335 135,670
International Equity 47,419 (3,158) 44,261 97,539
Small Cap Growth 9,048 (5,302) 3,746 43,103
Real Estate 165 (733) (568) 7,589
Asian Tigers 2,597 (7,300) (4,703) 31,514
Latin America Equity 817 (7,348) (6,531) 24,550
Small Cap Value 691 (960) (269) 9,018
</TABLE>
At December 31, 1998 the following Funds had available realized capital
losses to offset future net capital gains through fiscal year ended:
<TABLE>
<CAPTION>
Amount Expiration
(000) Date
-------------------
<S> <C> <C>
Treasury Money Market 5 2006
Government Money Market 2 2002
2 2004
Tax-Exempt Money Market 1 2005
Intermediate Government Fixed Income 49 2002
447 2003
962 2004
Tax-Exempt Fixed Income 1,063 2002
307 2003
International Equity 1,190 2006
Small Cap Growth 1,482 2006
Real Estate 114 2006
Asian Tigers 3,176 2005
7,164 2006
Latin America Equity 2,398 2006
Small Cap Value 581 2006
</TABLE>
At December 31, 1998 the following Funds have elected to defer capital losses
attributable to Post-October Losses:
<TABLE>
<CAPTION>
Amount
(000)
------
<S> <C>
Fixed Income 18
Small Cap Growth 718
Asian Tigers 808
Latin America Equity 309
Small Cap Value 9
</TABLE>
7. Foreign Securities
Certain Funds may invest in foreign securities. Investing in securities of
foreign companies and foreign governments involves special risks and
considerations not typically associated with investing in the securities of U.S.
companies and the U.S. government. These risks include re-valuation of
currencies and future political and economic developments. Moreover, securities
of many foreign companies and foreign governments and their markets may be less
liquid and their prices more volatile than those of securities of comparable
U.S. companies and the U.S. government. For more detailed information please
consult the prospectus.
8. Tax Information (unaudited)
During the fiscal year ended December 31, 1998, the following Funds made
distributions from long-term capital gains:
<TABLE>
<CAPTION>
Amount
-----------
<S> <C>
Fixed Income $ 186,422
International Fixed Income 68,656
Balanced 9,569,124
Value 63,893,039
Growth 17,056,206
International Equity 1,314,479
Small Cap Growth 206,528
</TABLE>
<PAGE>
[LOGO APPEARS HERE] ABN.AMRO Funds
- --------------------
ANNUAL REPORT
- --------------------
December 31, 1998
Money Market Funds
Treasury Money Market Fund
Government Money Market Fund
Money Market Fund
Tax-Exempt Money Market Fund
Fixed Income Funds
Fixed Income Fund
Intermediate Government Fixed Income Fund
Tax-Exempt Fixed Income Fund
Limited Volatility Fixed Income Fund*
Balanced Fund
Balanced Fund
Equity Funds
Value Fund
Growth Fund
Small Cap Growth Fund
Real Estate Fund
Small Cap Value Fund
International Funds
International Fixed Income Fund
International Equity Fund
Asian Tigers Fund
Latin America Equity Fund
TransEurope Fund*
INVESTMENT ADVISOR
ABN AMRO Asset Management (USA) Inc.
208 South LaSalle Street
Fourth Floor
Chicago, IL 60604-1003
ADMINISTRATOR
ABN AMRO Fund Services, Inc.
208 South LaSalle Street
Fourth Floor
Chicago, IL 60604-1003
DISTRIBUTOR
First Data Distributors, Inc.
4400 Computer Drive
Westborough, MA 01581
LEGAL COUNSEL
Morgan, Lewis & Bockius LLP
2000 One Logan Square
Philadelphia, PA 19103
INDEPENDENT AUDITORS
Ernst & Young LLP
200 Clarendon Street
Boston, MA 02116-5072
- -----------
* As of the date of this annual report, these funds had not yet commenced
operations.
For more information, call 1-800-443-4725
http://www.abnamrofunds-usa.com
[LOGO APPEARS HERE] ABN.AMRO
This report and the financial statements contained herein are
for the general information of the shareholders of the funds named above.
This report is not authorized for distribution to prospective investors in a
fund unless preceded or accompanied by a currently effective prospectus.
