<PAGE> 1
[ARK FUNDS LOGO]
SEMI-ANNUAL REPORT
UNAUDITED
OCTOBER 31, 1995
- ---------------------------------------------
U.S. Treasury Money Market Portfolio
U.S. Government Money Market Portfolio
Money Market Portfolio
Tax-Free Money Market Portfolio
Income Portfolio
Growth and Income Portfolio
Capital Growth Portfolio
International Equity Portfolio
Special Equity Portfolio
----------------------------------------------------------------
<PAGE> 2
ARK FUNDS: U.S. TREASURY MONEY MARKET PORTFOLIO
PORTFOLIO OF INVESTMENTS / OCTOBER 31, 1995 (UNAUDITED)
(Showing Percentage of Total Value of Investments)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Annualized
Yield at
Due Time of Principal Value
Date Purchase Amount (Note 1)
- --------- ----------- ----------- ------------
<S> <C> <C>
U.S. TREASURY OBLIGATIONS - 100.0%
U.S. TREASURY BILLS
11/09/95 5.49-5.52% ....................... $ 820,000 $ 819,014
11/16/95 5.76-6.00 ....................... 25,895,000 25,833,109
11/30/95 5.37 ....................... 710,000 706,969
12/14/95 5.50 ....................... 205,000 203,680
01/04/96 5.55 ....................... 1,210,000 1,198,320
01/25/96 5.50 ....................... 930,000 918,241
02/08/96 5.48-5.63 ....................... 32,940,000 32,446,465
02/15/96 5.45-5.46 ....................... 46,545,000 45,818,957
05/02/96 5.41-5.48 ....................... 7,360,000 7,162,995
05/30/96 5.50 ....................... 19,010,000 18,417,247
07/25/96 5.71 ....................... 10,000,000 9,598,388
U.S. TREASURY NOTES
11/15/95 5.60 ....................... 75,000,000 74,985,164
11/15/95 5.50 ....................... 50,000,000 50,055,682
03/31/96 5.82 ....................... 25,000,000 25,190,525
04/15/96 5.59 ....................... 10,000,000 10,163,865
------------
TOTAL U.S. TREASURY OBLIGATIONS................ 303,518,621
------------
TOTAL INVESTMENTS -- 100%
(Cost $303,518,621).......................... $303,518,621
============
</TABLE>
INCOME TAX INFORMATION:
Total cost for income tax purposes -- $303,518,621
The accompanying notes are an integral part of the financial statements.
<PAGE> 3
U.S. TREASURY MONEY MARKET PORTFOLIO
FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
October 31, 1995
<TABLE>
<S> <C> <C>
ASSETS:
Investments (Note 1)........................ $303,518,621
Cash........................................ 2,947
Interest receivable......................... 3,951,905
Organization costs (Note 1)................. 10,674
Other assets................................ 5,338
------------
Total assets............................ 307,489,485
LIABILITIES:
Dividends payable........................... $1,385,069
Advisory fees payable....................... 66,026
Other payables and accrued expenses......... 36,618
----------
Total liabilities....................... 1,487,713
------------
NET ASSETS.................................. $306,001,772
============
Net Assets consist of:
Paid in capital............................. $306,001,452
Accumulated undistributed net realized gain
on investments............................ 320
------------
NET ASSET................................... $306,001,772
============
INSTITUTIONAL CLASS:
NET ASSET VALUE, offering price and
redemption price per share ($258,328,838 /
258,312,556 shares outstanding)........... $1.00
====
INSTITUTIONAL II CLASS:
NET ASSET VALUE, offering price and
redemption price per share ($47,672,934 /
47,677,050 shares outstanding)............ $1.00
====
</TABLE>
STATEMENT OF OPERATIONS
Six months ended October 31, 1995
<TABLE>
<S> <C> <C>
INTEREST INCOME................................ $8,134,941
EXPENSES:
Advisory fee (Note 2).......................... $ 356,471
Administration and distribution fees (Note
2)........................................... 213,883
Registration fees.............................. 21,152
Distribution fee: (Note 3)
Institutional II Class....................... 12,228
Custodian fees and expenses.................... 20,689
Trustees' compensation......................... 2,904
Audit.......................................... 4,570
Legal.......................................... 12,476
Miscellaneous.................................. 10,688
--------
Total expenses before waivers.............. 655,061
Waivers of expenses (Note 4)................... (144,662) 510,399
-------- ----------
Net interest income............................ 7,624,542
Net realized loss on investments............... (3,522)
----------
Net increase in net assets resulting from
operations................................... $7,621,020
==========
</TABLE>
- ---------------
The accompanying notes are an integral part of the financial statements.
<PAGE> 4
U.S. TREASURY MONEY MARKET PORTFOLIO
FINANCIAL STATEMENTS (UNAUDITED) - continued
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Six months ended
October 31, 1995 Year ended
(Unaudited) April 30, 1995
---------------- --------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net interest income......................................................................... $ 7,624,542 $ 7,946,304
Net realized gain (loss) on investments..................................................... (3,522) 20,730
------------ ------------
Net increase in net assets resulting from operations.......................................... 7,621,020 7,967,034
------------ ------------
DISTRIBUTIONS:
Net interest income:
Institutional Class......................................................................... (6,997,079) (7,946,304)
Institutional II Class...................................................................... (627,463) --
------------ ------------
Net decrease in net assets resulting from distributions....................................... (7,624,542) (7,946,304)
------------ ------------
SHARE TRANSACTIONS AT NET ASSET VALUE OF $1.00 PER SHARE(1):
Proceeds from sales of shares................................................................. 259,803,850 512,041,076
Reinvested dividends.......................................................................... 419 673
Cost of shares redeemed....................................................................... (174,868,210) (428,819,265)
------------ ------------
Net increase in net assets and shares resulting from share transactions....................... 84,936,059 83,222,484
------------ ------------
Total increase in net assets.............................................................. 84,932,537 83,243,214
NET ASSETS:
Beginning of period......................................................................... 221,069,235 137,826,021
------------ ------------
End of period............................................................................... $ 306,001,772 $ 221,069,235
============ ============
- ---------------------------------------------------------------------------------------------------------------------------------
(1) Dollars and shares issued and redeemed:
Institutional Class:
Issued...................................................................................... $ 178,181,779 $ 512,041,076
Distributions reinvested.................................................................... 419 673
Redeemed.................................................................................... (140,923,189) (428,819,265)
------------ ------------
Net Increase.................................................................................. $ 37,259,009 $ 83,222,484
============ ============
Institutional II Class:
Issued...................................................................................... $ 81,622,071 --
Distributions reinvested.................................................................... -- --
Redeemed.................................................................................... (33,945,021) --
------------ ------------
Net Increase.................................................................................. $ 47,677,050 --
============ ============
</TABLE>
- ---------------
The accompanying notes are an integral part of the financial statements.
<PAGE> 5
U.S. TREASURY MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
Institutional Class
---------------------------------------------------------
Six months ended Period from
October 31, 1995 Year ended June 14, 1993**
(Unaudited) April 30, 1995 to April 30, 1994
------------------- -------------- ------------------
<S> <C> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period.................................. $ 1.000 $ 1.000 $ 1.000
-------- -------- --------
Income from investment operations:
Net interest income................................................... 0.027 0.045 0.025
Distributions:
Net interest income................................................... (0.027) (0.045) (0.025)
-------- -------- --------
Net asset value, end of period........................................ $ 1.000 $ 1.000 $ 1.000
======== ======== ========
TOTAL RETURN.......................................................... 2.73%+# 4.60%+ 2.48%+#
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (thousands)................................. $ 258,329 $221,069 $138,826
Ratio of expenses to average daily net assets(1)...................... 0.35%* 0.38% 0.43%*
Ratio of net interest income to average daily net assets.............. 5.37%* 4.59% 2.80%*
- ---------------
(1) During the period, certain fees were voluntarily waived. The ratio
of expenses to average daily net assets had such waiver not
occurred is as follows:........................................... 0.45%* 0.47% 0.51%*
</TABLE>
<TABLE>
<CAPTION>
Institutional II
Class
-------------------
Period from
July 28, 1995**
to October 31, 1995
(Unaudited)
-------------------
<S> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period.................................. $ 1.000
-------
Income from investment operations:
Net interest income................................................... 0.014
Distributions:
Net interest income................................................... (0.014)
-------
Net asset value, end of period........................................ $ 1.000
=======
TOTAL RETURN.......................................................... 1.36%+#
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (thousands)................................. $47,673
Ratio of expenses to average daily net assets(1)...................... 0.45%*
Ratio of net interest income to average daily net assets.............. 5.13%*
- ---------------
* Annualized
** Commencement of operations
+ Total return would have been lower had certain fees not been
waived during the period.
# Total return for period of less than one year is not annualized.
(1) During the period, certain fees were voluntarily waived. The 0.55%*
ratio of expenses to average daily net assets had such waivers
not occurred is as follows:......................................
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 6
ARK FUNDS: U.S. GOVERNMENT MONEY MARKET PORTFOLIO
PORTFOLIO OF INVESTMENTS / OCTOBER 31, 1995 (UNAUDITED)
(Showing Percentage of Total Value of Investments)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Annualized
Yield at
Due Time of Principal Value
Date Purchase Amount (Note 1)
- --------- ----------- ------------ ------------
<S> <C> <C>
U.S. GOVERNMENT & AGENCY OBLIGATIONS - 54.2%
FEDERAL FARM CREDIT BANK
11/03/95 6.02% .................... $ 10,000,000 $ 9,996,755
02/09/96 5.95+ .................... 25,000,000 24,996,713
06/20/96 5.76+ .................... 25,000,000 24,989,984
08/01/96 5.73 .................... 10,000,000 9,991,714
FEDERAL HOME LOAN BANK
11/02/95 6.11 .................... 15,000,000 14,997,529
01/02/96 6.35 .................... 15,000,000 14,843,450
02/21/96 6.59-6.69 .................... 20,000,000 20,006,725
05/06/96 6.00+ .................... 8,000,000 8,005,001
05/15/96 5.80+ .................... 10,000,000 9,998,446
09/26/96 5.80 .................... 10,000,000 10,000,000
09/27/96 5.87 .................... 3,000,000 2,995,053
10/30/96 5.83 .................... 10,000,000 10,000,000
FEDERAL HOME LOAN MORTGAGE CORPORATION
11/01/95 5.85 .................... 50,000,000 50,000,000
12/01/95 5.64 .................... 25,000,000 24,884,167
12/11/95 5.62 .................... 25,000,000 24,846,111
08/01/96 5.61-5.92 .................... 20,000,000 19,977,615
FEDERAL NATIONAL MORTGAGE ASSOCIATION
12/20/95 6.15+ .................... 7,000,000 7,001,584
12/28/95 5.65 .................... 25,000,000 24,780,708
01/26/96 6.12+ .................... 12,000,000 12,006,948
02/01/96 5.66 .................... 10,000,000 9,859,445
03/11/96 5.65 .................... 25,000,000 24,500,563
04/26/96 5.61 .................... 22,000,000 21,410,492
04/30/96 5.61 .................... 25,000,000 24,314,965
08/16/96 5.65+ .................... 25,000,000 25,000,000
09/27/96 5.81 .................... 10,000,000 10,000,000
------------
TOTAL U.S. GOVERNMENT & AGENCY OBLIGATIONS....
439,403,968
------------
<CAPTION>
Maturity Value
Amount (Note 1)
------------ ------------
<S> <C> <C>
REPURCHASE AGREEMENTS - 45.8%
CS First Boston, Inc., 5.87%, dated 10/31/95,
due 11/01/95, collateralized by $79,542,000
U.S. Treasury Bond, 11.25% due 02/15/15..... $121,265,123 $121,245,353
Goldman Sachs, 5.89%, dated 10/31/95, due
11/01/95, collateralized by $63,673,000 U.S.
Treasury Notes, 4.625-9.50% due
11/15/95-10/31/96 and $89,344,000 U.S.
Treasury Bills due 11/24/95-7/25/96......... 150,024,542 150,000,000
Smith Barney, 5.88%, dated 10/31/95, due
11/01/95, collateralized by $4,494,000 U.S.
Treasury Notes, 6.88-7.75% due
8/31/99-11/30/99, $141,000 Student Loan
Marketing Association 0.0% due 5/15/96,
$9,095,000 Resolution Trust Funding
Corporation, 0.0% due 10/25/99-11/1/25,
$16,250,711 Government National Mortgage
Association 8.00% due 5/15/02-4/15/25,
$32,761,583 Federal National Mortgage
Association, 5.00-7.50% due 10/25/99-11/1/25
and $83,979,193 Federal Home Loan Mortgage
Corporation 6.44-8.02% due
8/15/97-11/1/25............................. 100,016,333 100,000,000
------------
TOTAL REPURCHASE AGREEMENTS................... 371,245,353
------------
TOTAL INVESTMENTS - 100%
(Cost $810,649,321)......................... $810,649,321
===========
</TABLE>
- ---------------
+ Floating rate security -- rate disclosed is as of October 31, 1995.
INCOME TAX INFORMATION:
Total cost for income tax purposes -- $810,649,321
Net capital losses incurred after October 31, 1994 and within the taxable year
are deemed to arise on the first business day of the next following taxable
year. U.S. Government Money Market Portfolio incurred, and elected to defer, net
capital losses of approximately $4,000.
The accompanying notes are an integral part of the financial statements.
<PAGE> 7
U.S. GOVERNMENT MONEY MARKET PORTFOLIO
FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
October 31, 1995
<TABLE>
<S> <C> <C>
ASSETS:
Investments, at value (including repurchase
agreements of $371,245,353) (Note 1)...... $810,649,321
Interest receivable......................... 2,021,170
Organization costs (Note 1)................. 10,673
Other assets................................ 14,947
------------
Total assets............................ 812,696,111
LIABILITIES:
Dividends payable........................... $3,831,169
Advisory fees payable....................... 164,169
Registration fees payable................... 27,150
Other payables and accrued expenses......... 40,607
----------
Total liabilities....................... 4,063,095
------------
NET ASSETS.................................. $808,633,016
===========
Net Assets consist of:
Paid in capital............................. $808,590,074
Accumulated undistributed net realized gain
on investments............................ 42,942
------------
NET ASSETS.................................. $808,633,016
===========
INSTITUTIONAL CLASS:
NET ASSET VALUE, offering price and
redemption price per share
($796,939,923 / 796,895,275 shares
outstanding).............................. $1.00
====
INSTITUTIONAL II CLASS:
NET ASSET VALUE, offering price and
redemption price per share
($11,693,093 / 11,692,734 shares
outstanding).............................. $1.00
====
</TABLE>
STATEMENT OF OPERATIONS
Six months ended October 31, 1995
<TABLE>
<S> <C> <C>
INTEREST INCOME............................. $21,311,400
EXPENSES:
Advisory fee (Note 2)....................... $ 892,178
Administration and distribution fees (Note
2)........................................ 535,307
Distribution fee: (Note 3)
Institutional II Class.................... 2,772
Custodian fees and expenses................. 69,089
Trustees' compensation...................... 5,991
Registration fees........................... 34,271
Audit....................................... 4,720
Legal....................................... 32,420
Miscellaneous............................... 41,975
-----------
Total expenses before waivers........... 1,618,723
Waivers of expenses (Note 4)................ (571,390) 1,047,333
----------- -----------
Net interest income......................... 20,264,067
Net realized gain on investments............ 2,923
-----------
Net increase in net assets resulting from
operations................................ $20,266,990
==========
</TABLE>
- ---------------
The accompanying notes are an integral part of the financial statements.
<PAGE> 8
U.S. GOVERNMENT MONEY MARKET PORTFOLIO
FINANCIAL STATEMENTS (UNAUDITED) - continued
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Six months ended
October 31, 1995 Year ended
(Unaudited) April 30, 1995
---------------- ---------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net interest income........................................................................ $ 20,264,067 $ 24,682,509
Net realized gain on investments........................................................... 2,923 40,097
------------ ------------
Net increase in net assets resulting from operations......................................... 20,266,990 24,722,606
------------ ------------
DISTRIBUTIONS:
Net Interest Income:
Institutional Class........................................................................ (20,111,614) (24,682,509)
Institutional II Class..................................................................... (152,453)
------------ ------------
Net decrease in net assets resulting from distributions...................................... (20,264,067) (24,682,509)
------------ ------------
SHARE TRANSACTIONS AT NET ASSET VALUE OF $1.00 PER SHARE(1):
Proceeds from sales of shares................................................................ 821,760,128 1,609,772,103
Reinvested dividends......................................................................... 447 733
Cost of shares redeemed...................................................................... (664,243,388) (1,230,136,992)
------------ ------------
Net increase in net assets and shares resulting from share transactions...................... 157,517,187 379,635,844
------------ ------------
Total increase in net assets............................................................. 157,520,110 379,675,941
NET ASSETS:
Beginning of period........................................................................ 651,112,906 271,436,965
------------ ------------
End of period.............................................................................. $ 808,633,016 $ 651,112,906
============ ============
- ---------------------------------------------------------------------------------------------------------------------------------
(1) Dollars and shares issued and redeemed:
Institutional Class:
Issued..................................................................................... $ 794,606,076 $ 1,609,772,103
Distributions reinvested................................................................... 447 733
Redeemed................................................................................... (648,782,070) (1,230,136,992)
------------ ------------
Net increase................................................................................. $ 145,824,453 $ 379,635,844
============ ============
Institutional II Class:
Issued..................................................................................... $ 27,154,052 --
Distributions reinvested................................................................... -- --
Redeemed................................................................................... (15,461,318) --
------------ ------------
Net increase................................................................................. $ 11,692,734 --
============ ============
</TABLE>
- ---------------
The accompanying notes are an integral part of the financial statements.
<PAGE> 9
U.S. GOVERNMENT MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
Institutional Class
---------------------------------------------------------
Six months ended Period from
October 31, 1995 Year ended June 14, 1993**
(Unaudited) April 30, 1995 to April 30, 1994
------------------- -------------- ------------------
<S> <C> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period.................................. $ 1.000 $ 1.000 $ 1.000
-------- -------- --------
Income from investment operations:
Net interest income................................................... 0.029 0.049 0.027
Distributions:
Net interest income................................................... (0.029) (0.049) (0.027)
-------- -------- --------
Net asset value, end of period........................................ $ 1.000 $ 1.000 $ 1.000
======== ======== ========
TOTAL RETURN.......................................................... 2.90%+# 5.00%+ 2.70%+#
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (thousands)................................. $ 796,940 $651,113 $271,437
Ratio of expenses to average daily net assets(1)...................... 0.29%* 0.25% 0.35%*
Ratio of net interest income to average daily net assets.............. 5.68%* 5.09% 3.03%*
- ---------------
(1) During the period, certain fees were voluntarily waived. The ratio
of expenses to average daily net assets had such waivers not
occurred is as follows............................................ 0.45%* 0.47% 0.62%*
</TABLE>
<TABLE>
<CAPTION>
Institutional II
Class
--------------------
Period from
July 28, 1995**
to October 31, 1995
(Unaudited)
--------------------
<S> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period................................. $ 1.000
-------
Income from investment operations:
Net interest income.................................................. 0.014
Distributions:
Net interest income.................................................. (0.014)
-------
Net asset value, end of period....................................... $ 1.000
=======
TOTAL RETURN......................................................... 1.45%+#
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (thousands)................................ $ 11,693
Ratio of expenses to average daily net assets(1)..................... 0.40%*
Ratio of net interest income to average daily net assets............. 5.50%*
- ---------------
* Annualized
** Commencement of operations
+ Total return would have been lower had certain fees not been
waived during the period.
# Total return for period of less than one year is not annualized.
(1) During the period, certain fees were voluntarily waived. The 0.56%*
ratio of expenses to average daily net assets had such waivers
not occurred is as follows.......................................
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 10
ARK FUNDS: MONEY MARKET PORTFOLIO
PORTFOLIO OF INVESTMENTS / OCTOBER 31, 1995 (UNAUDITED)
(Showing Percentage of Total Value of Investments)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Annualized
Yield at
Due Time of Principal Value
Date Purchase Amount (Note 1)
- --------- ----------- ----------- ------------
<S> <C> <C>
U.S. GOVERNMENT & AGENCY OBLIGATIONS - 23.7%
FEDERAL HOME LOAN BANK
11/22/95 6.55% ....................... $25,000,000 $ 24,908,999
12/18/95 6.53 ....................... 10,000,000 9,919,055
05/15/96 5.80+ ....................... 10,000,000 9,998,446
08/21/96 5.79 ....................... 5,510,000 5,507,902
FEDERAL HOME LOAN MORTGAGE CORPORATION
06/03/96 6.00+ ....................... 5,000,000 4,994,326
06/07/96 6.20+ ....................... 5,000,000 5,000,000
FEDERAL NATIONAL MORTGAGE ASSOCIATION
01/26/96 6.12+ ....................... 16,000,000 16,007,013
09/27/96 5.81 ....................... 10,000,000 10,000,000
STUDENT LOAN MARKETING ASSOCIATION
07/19/96 5.60+ ....................... 8,020,000 8,021,631
10/14/97 5.62+ ....................... 2,000,000 2,000,000
-----------
TOTAL U.S. GOVERNMENT & AGENCY
OBLIGATIONS.................................. 96,357,372
-----------
COMMERCIAL PAPER - 8.5%
ABBEY NATIONAL
11/07/95 5.76 ....................... 5,000,000 4,995,275
CIESCO
11/14/95 5.74 ....................... 5,000,000 4,989,763
FORD MOTOR CREDIT CORP.
12/12/95 5.71 ....................... 10,000,000 9,935,881
07/22/96 5.70 ....................... 5,000,000 4,799,580
GOLDMAN SACHS & CO.
11/24/95 5.73 ....................... 10,000,000 9,963,775
-----------
TOTAL COMMERCIAL PAPER......................... 34,684,274
-----------
BONDS & NOTES - 27.9%
BANK OF NEW YORK, DELAWARE
10/25/96 5.87 ....................... 5,000,000 5,000,000
BANK ONE COLUMBUS
09/12/96 6.00 ....................... 5,000,000 5,000,000
BETA FINANCE CORP.(A)
11/07/95 5.53+ ....................... 5,000,000 5,000,000
07/29/96 6.03 ....................... 5,000,000 4,995,570
BLUE CHIP PRODUCTS, INC.
06/08/19 5.88+ ....................... 1,000,000 1,000,000
CAPITAL ONE FUNDING CORP.
10/01/15 5.82+ ....................... 5,000,000 5,000,000
CIT GROUP HOLDINGS, INC.
04/29/96 5.95 ....................... 2,500,000 2,499,383
FIRST UNION
05/13/96 5.90+ ....................... 5,000,000 5,000,000
09/16/96 5.82+ ....................... 10,000,000 9,990,403
GENERAL ELECTRIC CAPITAL CORP.
02/15/96 6.10+ ....................... 5,000,000 5,000,000
01/01/06 5.91+ ....................... 1,962,021 1,962,021
GENERAL MOTORS ACCEPTANCE CORP.
02/08/96 6.47 ....................... 5,000,000 5,030,404
05/01/96 5.93 ....................... 5,000,000 5,063,666
06/07/96 5.90+ ....................... 5,000,000 5,000,000
MERRILL LYNCH
03/13/96 6.11+ ....................... 5,000,000 5,000,000
04/22/96 6.07+ ....................... 5,000,000 5,000,000
07/24/96 5.77+ ....................... 5,000,000 5,000,000
NATIONSBANK CORP.
08/15/96 5.79 ....................... 10,000,000 9,913,285
<CAPTION>
Annualized
Yield at
Due Time of Principal Value
Date Purchase Amount (Note 1)
- --------- ----------- ----------- ------------
<S> <C> <C>
PNC BANK N.A.
11/13/95 6.33 ....................... $ 5,000,000 $ 5,000,033
WACHOVIA CORP.
08/05/96 5.73 ....................... 10,000,000 10,025,350
WELLS FARGO
08/16/96 5.81+ ....................... 8,000,000 8,001,751
-----------
TOTAL BONDS & NOTES............................ 113,481,866
-----------
CERTIFICATES OF DEPOSIT - 3.7%
BAYERISCHE VEREINSBANK YANKEE
07/12/96 5.90 ....................... 10,000,000 10,000,000
DEUTSCHE YANKEE
08/21/96 6.15 ....................... 5,000,000 5,000,000
-----------
TOTAL CERTIFICATES OF DEPOSIT.................. 15,000,000
-----------
MUNICIPAL BONDS & NOTES - 9.6%
CALIFORNIA
Oakland Alameda County, California
01/10/96 5.87 ....................... 10,000,000 10,000,000
MASSACHUSETTS
Massachusetts Industrial Finance Agency
12/01/95 5.82 ....................... 15,000,000 15,000,000
NEW YORK
New York City General Obligation
11/21/95 6.02 ....................... 10,000,000 10,000,000
NORTH CAROLINA
Durham, NC, Taxable Certificates, Series B
07/01/03 5.92+ ....................... 1,500,000 1,500,000
PENNSYLVANIA
Pennsylvania State, Economic Development
Financing Authority Revenue Bonds, Series A1
08/01/04 5.85+ ....................... 800,000 800,000
Pennsylvania State, Economic Development
Financing Authority Revenue Bonds, Series A1
08/01/12 5.85+ ....................... 1,700,000 1,700,000
-----------
TOTAL MUNICIPAL BONDS & NOTES.................. 39,000,000
-----------
</TABLE>
<TABLE>
<CAPTION>
Maturity
Amount
-----------
<S> <C> <C>
REPURCHASE AGREEMENTS - 26.6%
CS First Boston, 5.87%, dated 10/31/95, due
11/01/95, collateralized by $38,769,000 U.S.
Treasury Bond, 11.25% due 02/15/15........... $58,354,151 58,344,638
Goldman Sachs, 5.89%, dated 10/31/95, due
11/01/95, collateralized by $21,224,000 U.S.
Treasury Notes, 4.625-9.50% due 11/15/95-
10/31/96 and $29,781,000 U.S. Treasury Bills
due 11/24/95-7/25/96......................... 50,008,181 50,000,000
------------
TOTAL REPURCHASE AGREEMENTS.................... 108,344,638
------------
TOTAL INVESTMENTS - 100%
(Cost $406,868,150).......................... $406,868,150
===========
</TABLE>
- ---------------
+ Floating rate security -- rate disclosed is as of October 31,
1995.
(a) Security exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in
transactions exempt from registration, normally to qualified
institutional buyers. At the year end, the value of these
securities amounted to approximately $9,995,570 or 2.5% of net
assets.
INCOME TAX INFORMATION:
Total cost for income tax purposes -- $406,868,150
The accompanying notes are an integral part of the financial statements.
<PAGE> 11
MONEY MARKET PORTFOLIO
FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
October 31, 1995
<TABLE>
<S> <C> <C>
ASSETS:
Investments, at value (including repurchase
agreements of $108,344,638) (Note 1)...... $406,868,150
Interest receivable......................... 2,422,375
Organization costs (Note 1)................. 10,782
Other assets................................ 7,802
-----------
Total assets............................ 409,309,109
LIABILITIES:
Dividends payable........................... $1,537,084
Advisory fees payable....................... 64,175
Registration fees payable................... 30,864
Other payables and accrued expenses......... 29,790
-----------
Total liabilities....................... 1,661,913
-----------
NET ASSETS.................................. $407,647,196
===========
Net Assets consist of:
Paid in capital............................. $407,619,100
Accumulated undistributed net realized gain
on investments............................ 28,096
-----------
NET ASSETS.................................. $407,647,196
===========
INSTITUTIONAL CLASS:
NET ASSET VALUE, offering price and
redemption price per share ($309,552,145 /
309,521,109 shares outstanding)........... $1.00
====
RETAIL CLASS:
NET ASSET VALUE, offering price and
redemption price per share ($77,736,148 /
77,729,773 shares outstanding)............ $1.00
====
INSTITUTIONAL II CLASS:
NET ASSET VALUE, offering price and
redemption price per share ($20,358,903 /
20,358,671 shares outstanding)............ $1.00
====
</TABLE>
STATEMENT OF OPERATIONS
Six months ended October 31, 1995
<TABLE>
<S> <C> <C>
INTEREST INCOME.............................. $11,546,408
EXPENSES:
Advisory fee (Note 2)........................ $ 476,081
Administration and distribution fees (Note
2)......................................... 285,649
Transfer agent fee (Note 2)
Retail Class............................... 8,921
Distribution fee: (Note 3)
Retail Class............................... 79,870
Institutional Il Class..................... 3,740
Shareholder servicing fee: (Note 3)
Retail Class............................... 47,920
Custodian fees and expenses.................. 35,377
Trustees' compensation....................... 4,702
Registration fees............................ 22,283
Audit........................................ 4,570
Legal........................................ 19,636
Miscellaneous................................ 26,502
Total expenses before waivers.............. 1,015,251
---------
Waivers of expenses (Note 4)................. (425,153) 590,098
--------- -----------
Net interest income.......................... 10,956,310
Net realized loss on investments............. (1,088)
Net increase in net assets resulting from -----------
operations................................. $10,955,222
===========
</TABLE>
- ---------------
The accompanying notes are an integral part of the financial statements.
<PAGE> 12
MONEY MARKET PORTFOLIO
FINANCIAL STATEMENTS (UNAUDITED) - continued
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Six months ended
October 31, 1995 Year ended
(Unaudited) April 30, 1995
---------------- --------------
<S> <C> <C>
INCREASE IN NET ASSETS:
OPERATIONS:
Net interest income....................................................................... $ 10,956,310 $ 13,830,132
Net realized gain (loss) on investments................................................... (1,088) 29,184
----------- -----------
Net increase in net assets resulting from operations........................................ 10,955,222 13,859,316
----------- -----------
DISTRIBUTIONS:
Net interest income:
Institutional Class....................................................................... (9,003,903) (12,863,420)
Retail Class.............................................................................. (1,742,280) (966,712)
Institutional II Class.................................................................... (210,127) --
----------- -----------
Net decrease in net assets resulting from distributions..................................... (10,956,310) (13,830,132)
----------- -----------
SHARE TRANSACTIONS AT NET ASSET VALUE OF $1.00 PER SHARE(1):
Proceeds from sales of shares............................................................... 441,741,684 707,640,605
Reinvested dividends........................................................................ 1,751,106 967,465
Cost of shares redeemed..................................................................... (364,784,481) (576,871,632)
----------- -----------
Net increase in net assets resulting from share transactions................................ 78,708,309 131,736,438
----------- -----------
Total increase in net assets............................................................ 78,707,221 131,765,622
NET ASSETS:
Beginning of period....................................................................... 328,939,975 197,174,353
----------- -----------
End of period............................................................................. $ 407,647,196 $ 328,939,975
=========== ===========
- ---------------------------------------------------------------------------------------------------------------------------------
(1) Dollars and shares issued and redeemed:
Institutional Class:
Issued.................................................................................... $ 364,590,086 $ 642,304,499
Distributions reinvested.................................................................. 460 753
Redeemed.................................................................................. (332,899,256) (561,628,177)
----------- -----------
Net increase................................................................................ $ 31,691,290 $ 80,677,075
=========== ===========
Retail Class:
Issued.................................................................................... $ 45,710,138 $ 65,336,106
Distributions reinvested.................................................................. 1,750,646 966,712
Redeemed.................................................................................. (20,802,436) (15,243,455)
----------- -----------
Net increase................................................................................ $ 26,658,348 $ 51,059,363
=========== ===========
Institutional II Class:
Issued.................................................................................... $ 31,441,460 --
Distributions reinvested.................................................................. -- --
Redeemed.................................................................................. (11,082,789) --
----------- -----------
Net increase................................................................................ $ 20,358,671 --
=========== ===========
</TABLE>
- ---------------
The accompanying notes are an integral part of the financial statements.
<PAGE> 13
MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
Institutional Class
---------------------------------------------------------
Six months ended Period from
October 31, 1995 Year ended June 14, 1994**
(Unaudited) April 30, 1995 to April 30, 1994
---------------- -------------- -----------------
<S> <C> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period.................................. $ 1.000 $ 1.000 $ 1.000
-------- -------------- --------
Income from investment operations:
Net interest income................................................... 0.029 0.050 0.028
Distributions:
Net interest income................................................... (0.029) (0.050) (0.028)
-------- -------------- --------
Net asset value, end of period........................................ $ 1.000 $ 1.000 $ 1.000
=============== ============ ==============
TOTAL RETURN.......................................................... 2.98%+# 5.13%+ 2.80%+#
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (thousands)................................. $309,552 $277,859 $ 197,162
Ratio of expenses to average daily net assets(1)...................... 0.25%* 0.20% 0.26%*
Ratio of net interest income to average daily net assets.............. 5.82%* 5.13% 3.16%*
- ---------------
(1) During the period, certain fees were voluntarily waived. The ratio
of expenses to average daily net assets had such waivers not
occurred is as follows:........................................... 0.46%* 0.46% 0.52%*
</TABLE>
<TABLE>
<CAPTION>
Retail Class
---------------------------------------------------------
Six months ended Period from
October 31, 1995 Year ended June 14, 1994**
(Unaudited) April 30, 1995 to April 30, 1994
---------------- -------------- -----------------
<S> <C> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period.................................. $ 1.000 $ 1.000 $ 1.000
-------- -------- --------
Income from investment operations:
Net interest income................................................... 0.028 0.046 0.004
Distributions:
Net interest income................................................... (0.028) (0.046) (0.004)
-------- -------- --------
Net asset value, end of period........................................ $ 1.000 $ 1.000 $ 1.000
======== ======== ========
TOTAL RETURN.......................................................... 2.80%+# 4.69%+ 0.42%+#
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (thousands)................................. $ 77,736 $ 51,081 $ 12
Ratio of expenses to average daily net assets(1)...................... 0.60%* 0.45% 1.16%*
Ratio of net interest income to average daily net assets.............. 5.45%* 4.88% 2.26%*
- ---------------
(1) During the period, certain fees were voluntarily waived. The ratio
of expenses to average daily net assets had such waivers not
occurred is as follows:........................................... 0.89%* 0.97% 592.55%*
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 14
MONEY MARKET PORTFOLIO - continued
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
Institutional II
Class
-------------------
Period from
July 21, 1995**
to October 31, 1995
(Unaudited)
-------------------
<S> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period...................................................................... $ 1.000
-------
Income from investment operations:
Net interest income....................................................................................... 0.016
Distributions:
Net interest income....................................................................................... (0.016)
-------
Net asset value, end of period............................................................................ $ 1.000
=======
TOTAL RETURN.............................................................................................. 1.61%+#
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (thousands)..................................................................... $20,359
Ratio of expenses to average daily net assets(1).......................................................... 0.35%*
Ratio of net interest income to average daily net assets.................................................. 5.62%*
- ---------------
* Annualized
** Commencement of operations
+ Total return would have been lower had certain fees not been waived during the period.
# Total return for periods of less than one year are not annualized.
(1) During the period, certain fees were voluntarily waived. The ratio of expenses to average daily net
assets had such waivers not occurred is as follows................................................... 0.57%*
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 15
ARK FUNDS: TAX-FREE MONEY MARKET PORTFOLIO
PORTFOLIO OF INVESTMENTS / OCTOBER 31, 1995 (UNAUDITED)
(Showing Percentage of Total Value of Investments)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Principal Value
Amount (Note 1)
--------- -----------
<S> <C> <C>
MUNICIPAL BONDS AND NOTES - 80.6%
ALASKA - 0.2%
Valdez, AK, Marine Terminal Revenue Bonds,
Exxon Pipeline Project, variable rate,
3.90%, 10/01/25........................... $ 200,000 $ 200,000
-----------
ARIZONA - 2.6%
Maricopa County, AZ, School District, Tax
Anticipation Notes, Series A, 4.45%,
07/31/96.................................. 2,700,000 2,710,632
-----------
COLORADO - 2.6%
Colorado Educational Facilities Authority
Revenue Bonds variable rate, 4.00%,
10/01/10.................................. 2,700,000 2,700,000
-----------
DELAWARE - 1.2%
Delaware State Health Facilities Authority
Revenue Bonds, variable rate, 3.75%,
03/01/00.................................. 1,300,000 1,300,000
-----------
FLORIDA - 6.1%
Dade County, FL, Special Obligation Revenue
Bonds, Fixed Capital Asset Acquisition,
variable rate, 4.15%, 10/01/10............ 1,600,000 1,600,000
Florida State Housing Authority, variable
rate, 3.95%, 06/15/25..................... 4,000,000 4,000,000
Indian Trace Community Development District,
FL, Series A, variable rate, 3.85%,
11/01/99.................................. 900,000 900,000
-----------
6,500,000
-----------
GEORGIA - 5.0%
Burke County, GA, Pollution Control Revenue
Bonds, Oglethorpe Power Corp., variable
rate, 3.90%, 01/01/16..................... 2,000,000 2,000,000
De Kalb County, GA, Development Authority
Revenue Bonds, variable rate, 4.15%,
02/01/98.................................. 700,000 700,000
De Kalb County, GA, Development Authority
Revenue Bonds, variable rate, 4.15%,
02/01/99.................................. 600,000 600,000
Fulton County, GA, Development Authority
Revenue Bonds, Metro Atlanta YMCA Project,
variable rate, 3.85%, 06/01/20............ 2,000,000 2,000,000
-----------
5,300,000
-----------
ILLINOIS - 8.2%
Du Page, IL, Water Commission General
Obligation Bonds, 7.50%, 03/01/00
(Prerefunded 03/01/96 at 102)............. 1,000,000 1,029,816
Illinois Health Facilities Authority Revenue
Bonds, Methodist Medical Center, Series B,
variable rate, 3.85%, 10/01/14............ 2,700,000 2,700,000
Illinois State Revenue Anticipation
Certificates, 4.50%, 06/10/96............. 3,000,000 3,011,442
Village of Lisle, IL, Multi-family Revenue
Bonds, variable rate, 3.85%, 12/15/25..... 1,900,000 1,900,000
-----------
8,641,258
-----------
IOWA - 3.3%
Iowa School Corps., Certificate
Participation Warrants, Series A, 4.75%,
06/28/96.................................. 1,000,000 1,005,679
Iowa School Corps., Certificate
Participation Warrants, Series B, 5.75%,
02/01/96.................................. 500,000 500,900
Iowa State Higher Education Facilities Loan
Authority Revenue Bonds, St. Ambrose
University Project, variable rate, 3.90%,
02/01/05.................................. 2,000,000 2,000,000
-----------
3,506,579
-----------
KENTUCKY - 0.5%
Pendleton County, KY, Insurance Funding
Revenue Bonds, variable rate, 4.00%,
07/01/96.................................. 500,000 500,000
-----------
<CAPTION>
Principal Value
Amount (Note 1)
--------- -----------
<S> <C> <C>
LOUISIANA - 1.1%
Louisiana State Hospital Public Facilities
Authority Revenue Bonds, Hospital
Equipment Financing & Refunding, variable
rate, Series A, 4.30%, 12/01/05........... $1,200,000 $ 1,200,000
-----------
MARYLAND - 7.4%
Baltimore, MD, Industrial Development
Authority Revenue Bonds, variable rate,
4.20%, 08/01/16........................... 4,000,000 4,000,000
Maryland State Health & Higher Education
Facilities Authority Revenue Bonds, Series
A, variable rate, 3.85%, 10/01/10......... 1,700,000 1,700,000
Maryland State Health & Higher Education
Facilities Authority Revenue Bonds, Series
A, variable rate, 3.85%, 04/01/35......... 1,100,000 1,100,000
Washington Suburban Sanitation District, MD,
General Obligation Bonds, 6.75%,
01/01/96.................................. 1,000,000 1,004,030
-----------
7,804,030
-----------
MICHIGAN - 2.8%
Michigan State Underground Storage Tank
Financial Assurance Authority Revenue
Bonds, Series I, variable rate, 3.90%,
12/01/04.................................. 3,000,000 3,000,000
-----------
MINNESOTA - 1.9%
Minneapolis, MN, General Obligation Bonds,
Series B, variable rate, 3.95%,
12/01/05.................................. 2,000,000 2,000,000
-----------
MISSISSIPPI - 1.6%
Jackson County, MS, Port Facility Revenue
Bonds, variable rate, 3.90%, 06/01/23..... 1,650,000 1,650,000
-----------
MISSOURI - 0.9%
City of Columbia, MO, Special Revenue Bonds,
Series A, variable rate, 3.95%,
06/01/08.................................. 1,000,000 1,000,000
-----------
MONTANA - 3.5%
Forsyth, MT, Pollution Control Revenue
Bonds, Portland General Electric Co.,
Series A, variable rate, 3.95%,
06/01/13.................................. 3,700,000 3,700,000
-----------
NEW HAMPSHIRE - 3.0%
New Hampshire State Business Finance
Authority Pollution Control Revenue Bonds,
Series A, variable rate, 3.95%,
12/01/22.................................. 3,200,000 3,200,000
-----------
NEW YORK - 3.8%
New York City, NY, General Obligation Bonds,
Series A, Subseries A9, variable rate,
4.05%, 08/01/18........................... 2,500,000 2,500,000
New York City, NY, General Obligation Bonds,
Series B, Subseries B3, variable rate,
4.00%, 08/15/04........................... 1,300,000 1,300,000
New York State Energy Resource and
Development Authority, Pollution Control
Revenue Bonds, Niagara Mohawk Power,
Series B, variable rate, 3.85%,
12/01/25.................................. 200,000 200,000
-----------
4,000,000
-----------
OREGON - 4.1%
Oregon State General Obligation Bonds,
Series 73-E, variable rate, 3.85%,
12/01/16.................................. 700,000 700,000
Port of St. Helens, OR, Pollution Control
Revenue Bonds, Series A, variable rate,
3.95%, 04/01/10........................... 3,600,000 3,600,000
-----------
4,300,000
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 16
TAX-FREE MONEY MARKET PORTFOLIO
PORTFOLIO OF INVESTMENTS / OCTOBER 31, 1995 (UNAUDITED) - continued
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Principal Value
Amount (Note 1)
--------- -----------
<S> <C> <C>
MUNICIPAL BONDS AND NOTES - continued
PENNSYLVANIA - 10.4%
Allegheny County, PA, Hospital Development
Authority Revenue Bonds, Presbyterian
University Hospital, Series C, variable
rate, 3.85%, 03/01/20..................... $ 400,000 $ 400,000
Allegheny County, PA, Hospital Development
Authority Revenue Bonds, Presbyterian
University Hospital, Series D, variable
rate, 3.85%, 03/01/20..................... 200,000 200,000
Allegheny County, PA, Series C-39, General
Obligation Bond, 4.40%, 05/01/96.......... 1,000,000 1,002,880
Bucks County, PA, Industrial Development
Authority Revenue Bonds, variable rate,
3.85%, 07/01/15........................... 2,200,000 2,200,000
Commonwealth of Pennsylvania, Higher
Education University Funding Obligations,
Temple University, 5.00%, 05/22/96........ 2,000,000 2,007,441
Delaware County, PA, Industrial Development
Authority Solid Waste Revenue Bonds, Scott
Paper Company, Series D, variable rate
3.95%, 12/01/18........................... 2,500,000 2,500,000
Lehigh County, PA, Industrial Development
Authority Pollution Control Revenue Bonds,
Allegheny Electric Coop, Inc., Series A,
variable rate 3.85%, 12/01/15............. 1,700,000 1,700,000
Philadelphia, PA, Hospital and Higher
Education, Facilities Authority Revenue
Bonds, 3.85%, 07/01/96.................... 1,000,000 1,000,000
-----------
11,010,321
-----------
RHODE ISLAND - 3.8%
Rhode Island State Tax Anticipation Notes,
4.50%, 06/28/96........................... 4,000,000 4,020,217
-----------
TENNESSEE - 1.4%
Jefferson County, TN, Industrial Development
Authority Revenue Bonds, variable rate,
4.15%, 04/01/98........................... 1,500,000 1,500,000
-----------
TEXAS - 4.1%
Texas State Tax & Revenue Anticipation
Notes, Series A, 4.75%, 08/30/96.......... 3,000,000 3,016,257
Texas State, Higher Education Authority
Revenue Bonds, Series B, variable rate,
3.90%, 12/01/25........................... 1,300,000 1,300,000
-----------
4,316,257
-----------
WYOMING - 1.1%
Lincoln County, WY, Pollution Control
Revenue Bonds, Exxon Project, variable
rate, 3.90%, 08/01/15..................... 900,000 900,000
Sublette County, WY, Pollution Control
Revenue Bonds, variable rate, 3.90%,
11/01/14.................................. 300,000 300,000
-----------
1,200,000
-----------
TOTAL MUNICIPAL BONDS AND NOTES............. 85,259,294
-----------
<CAPTION>
Principal Value
Amount (Note 1)
--------- -----------
<S> <C> <C>
COMMERCIAL PAPER - 19.4%
FLORIDA - 2.8%
Sunshine State, 3.75%, 11/15/95............. $3,000,000 $ 3,000,000
-----------
INDIANA - 2.8%
Sullivan, IN 3.75%, 12/01/95................ 1,000,000 1,000,000
Sullivan, IN 3.75%, 12/13/95................ 2,000,000 2,000,000
-----------
3,000,000
-----------
KENTUCKY - 2.4%
Jefferson County, KY 3.90%, 01/17/96........ 2,500,000 2,500,000
-----------
MARYLAND - 2.4%
Howard County, MD, 3.80%, 12/15/95.......... 2,500,000 2,500,000
-----------
MASSACHUSETTS - 0.9%
Massachusetts State Health and Education,
3.80%, 01/18/96........................... 1,000,000 1,000,000
-----------
SOUTH CAROLINA - 3.8%
South Carolina Public Service Authority,
3.75%, 12/13/95........................... 2,000,000 2,000,000
South Carolina Public Service Authority,
3.80%, 01/09/96........................... 2,000,000 2,000,000
-----------
4,000,000
-----------
TEXAS - 3.4%
Texas Municipal Power Agency, 4.05%,
11/03/95.................................. 1,000,000 1,000,000
Texas Municipal Power Agency, 3.85%,
01/31/96.................................. 2,600,000 2,600,000
-----------
3,600,000
-----------
WYOMING - 0.9%
Gillette County, WY, 3.70%, 12/07/95........ 1,000,000 1,000,000
-----------
TOTAL COMMERCIAL PAPER...................... 20,600,000
-----------
TOTAL INVESTMENTS - 100%
(Cost $105,859,294)....................... $105,859,294
===========
</TABLE>
INCOME TAX INFORMATION:
Total cost for income tax purposes -- $105,859,294
The accompanying notes are an integral part of the financial statements.
<PAGE> 17
TAX-FREE MONEY MARKET PORTFOLIO
FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
October 31, 1995
<TABLE>
<S> <C> <C>
ASSETS:
Investments, at value (Note 1)............... $105,859,294
Cash......................................... 13,337
Interest receivable.......................... 606,993
Organization costs (Note 1).................. 10,673
Other assets................................. 1,585
------------
Total assets............................. 106,491,882
LIABILITIES:
Dividends payable............................ $306,395
Advisory fees payable........................ 10,118
Registration fees payable.................... 6,840
Other payables and accrued expenses.......... 10,676
--------
Total liabilities........................ 334,029
------------
NET ASSETS................................... $106,157,853
============
Net Assets consist of:
Paid in capital.............................. $106,159,087
Accumulated net realized loss on
investments................................ (1,234)
------------
NET ASSETS................................... $106,157,853
============
INSTITUTIONAL CLASS:
NET ASSET VALUE, offering price and
redemption price per share ($89,106,813 /
89,108,101 shares outstanding)............. $1.00
====
RETAIL CLASS:
NET ASSET VALUE, offering price and
redemption price per share ($8,135,277 /
8,135,123 shares outstanding).............. $1.00
====
INSTITUTIONAL II CLASS:
NET ASSET VALUE, offering price and
redemption price per share ($8,915,763 /
8,915,863 shares outstanding).............. $1.00
====
</TABLE>
STATEMENT OF OPERATIONS
Six months ended October 31, 1995
<TABLE>
<S> <C> <C>
INTEREST INCOME................................ $1,768,579
EXPENSES:
Advisory fee (Note 2).......................... $ 114,546
Administration and distribution fees (Note
2)........................................... 68,727
Transfer agent fee (Note 2)
Retail Class................................. 8,762
Distribution fee: (Note 3)
Retail Class................................. 7,102
Institutional II Class....................... 1,495
Shareholder servicing fee: (Note 3)
Retail Class................................. 4,261
Custodian fees and expenses.................... 8,893
Trustees' compensation......................... 1,144
Registration fees.............................. 17,273
Audit.......................................... 3,480
Legal.......................................... 3,687
Miscellaneous.................................. 3,635
---------
Total expenses before waivers.............. 243,005
Waivers of expenses (Note 4)................... (136,696) 106,309
--------- ----------
Net interest income............................ 1,662,270
Net realized gain on investments............... 2,290
----------
Net increase in net assets resulting from
operations................................... $1,664,560
==========
</TABLE>
- ---------------
The accompanying notes are an integral part of the financial statements.
<PAGE> 18
TAX-FREE MONEY MARKET PORTFOLIO
FINANCIAL STATEMENTS (UNAUDITED) - continued
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Six months ended
October 31, 1995 Year ended
(Unaudited) April 30, 1995
---------------- --------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net interest income....................................................................... $ 1,662,270 $ 2,155,331
Net realized gain (loss) on investments................................................... 2,290 (2,904)
---------------- --------------
Net increase in net assets resulting from operations........................................ 1,664,560 2,152,427
---------------- --------------
DISTRIBUTIONS:
Net interest income:
Institutional Class....................................................................... (1,507,964) (2,125,707)
Retail Class.............................................................................. (101,856) (29,624)
Institutional II Class.................................................................... (52,450) --
---------------- --------------
Net decrease in net assets resulting from distributions..................................... (1,662,270) (2,155,331)
---------------- --------------
SHARE TRANSACTIONS AT NET ASSET VALUE OF $1.00 PER SHARE(1):
Proceeds from sales of shares............................................................... 107,219,610 96,671,046
Reinvested dividends........................................................................ 102,459 30,095
Cost of shares redeemed..................................................................... (67,769,457) (96,837,453)
---------------- --------------
Net increase (decrease) in net assets and shares resulting from share transactions.......... 39,552,612 (136,312)
---------------- --------------
Total increase (decrease) in net assets................................................. 39,554,902 (139,216)
NET ASSETS:
Beginning of period....................................................................... 66,602,951 66,742,167
---------------- --------------
End of period............................................................................. $106,157,853 $ 66,602,951
=============== ============
- ---------------------------------------------------------------------------------------------------------------------------------
(1) Dollars and shares issued and redeemed:
Institutional Class:
Issued.................................................................................... $ 84,114,367 $ 93,502,678
Distributions reinvested.................................................................. 280 471
Redeemed.................................................................................. (59,121,897) (96,080,845)
---------------- --------------
Net increase (decrease)..................................................................... $ 24,992,750 $ (2,577,696)
=============== ============
Retail Class:
Issued.................................................................................... $ 8,789,374 $ 3,168,368
Distributions reinvested.................................................................. 102,179 29,624
Redeemed.................................................................................. (3,247,554) (756,608)
---------------- --------------
Net increase................................................................................ $ 5,643,999 $ 2,441,384
=============== ============
Institutional II Class:
Issued.................................................................................... $ 14,315,869 --
Distributions reinvested.................................................................. -- --
Redeemed.................................................................................. (5,400,006) --
---------------- --------------
Net increase................................................................................ $ 8,915,863 --
=============== ============
</TABLE>
- ---------------
The accompanying notes are an integral part of the financial statements.
<PAGE> 19
TAX-FREE MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
Institutional Class
---------------------------------------------------------
Six months ended Period from
October 31, 1995 Year ended June 14, 1993**
(Unaudited) April 30, 1995 to April 30, 1994
---------------- -------------- -----------------
<S> <C> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period.................................. $ 1.000 $ 1.000 $ 1.000
------- ------- -------
Income from investment operations:
Net interest income................................................... 0.019 0.032 0.019
Distributions:
Net interest income................................................... (0.019) (0.032) (0.019)
------- ------- -------
Net asset value, end of period........................................ $ 1.000 $ 1.000 $ 1.000
======= ======= =======
TOTAL RETURN.......................................................... 1.87%+# 3.24%+ 1.87%+#
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (thousands)................................. $ 89,107 $ 64,112 $66,692
Ratio of expenses to average daily net assets(1)...................... 0.23%* 0.22% 0.35%*
Ratio of net interest income to average daily net assets.............. 3.64%* 3.21% 2.10%*
- ---------------
(1) During the period, certain fees were voluntarily waived. The ratio
of expenses to average daily net assets had such waivers not
occurred is as follows............................................ 0.48%* 0.47% 0.53%*
</TABLE>
<TABLE>
<CAPTION>
Retail Class
--------------------------------------------------------
Period from
Six months ended March 15, 1994**
October 31, 1995 Year ended to April 30,
(Unaudited) April 30, 1995 1994
---------------- -------------- ----------------
<S> <C> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period................................... $ 1.000 $ 1.000 $ 1.000
------- ------- -------
Income from investment operations:
Net interest income.................................................... 0.018 0.027 0.002
Distributions:
Net interest income.................................................... (0.018) (0.027) (0.002)
------- ------- -------
Net asset value, end of period......................................... $ 1.000 $ 1.000 $ 1.000
======= ======= =======
TOTAL RETURN........................................................... 1.84%+# 2.74%+ 0.20%+#
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (thousands).................................. $ 8,135 $ 2,491 $ 50
Ratio of expenses to average daily net assets(1)....................... 0.27%* 0.75% 1.25%*
Ratio of net interest income to average daily net assets............... 3.59%* 2.68% 1.20%*
- ---------------
(1) During the period, certain fees were voluntarily waived. The ratio
of expenses to average daily net assets had such waivers not
occurred is as follows............................................. 1.01%* 2.94% 32.17%*
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 20
TAX-FREE MONEY MARKET PORTFOLIO - continued
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
Institutional II
Class
-------------------
Period from
July 28, 1995
to October 31, 1995
(Unaudited)
-------------------
<S> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period...................................................................... $ 1.000
-------
Income from investment operations:
Net interest income....................................................................................... 0.009
Distributions:
Net interest income....................................................................................... (0.009)
-------
Net asset value, end of period............................................................................ $ 1.000
=======
TOTAL RETURN.............................................................................................. 0.94%+#
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (thousands)..................................................................... $ 8,916
Ratio of expenses to average daily net assets(1).......................................................... 0.31%*
Ratio of net interest income to average daily net assets.................................................. 3.51%*
- ---------------
* Annualized
** Commencement of operations
+ Total return would have been lower had certain fees not been waived during the period.
# Total return for periods of less than one year are not annualized.
(1) During the period, certain fees were voluntarily waived. The ratio of expenses to average daily net
assets had such waivers not occurred is as follows................................................... 0.57%*
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 21
ARK FUNDS: INCOME PORTFOLIO
PORTFOLIO OF INVESTMENTS / OCTOBER 31, 1995 (UNAUDITED)
(Showing Percentage of Total Value of Investments)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Ratings - Unaudited
Due ---------------------- Principal Value
Date Coupon (Moody's) (S&P) Amount (Note 1)
- --------- ------- ----------- ------- ---------- -----------
<S> <C>
U.S. GOVERNMENT & AGENCY OBLIGATIONS - 73.7%
U.S. TREASURY BONDS
11/15/21 8.00% N/R N/R $3,000,000 $ 3,585,179
11/15/22 7.63 N/R N/R 4,000,000 4,612,080
08/15/23 6.25 N/R N/R 2,000,000 1,954,700
U.S. TREASURY NOTES
02/28/97 6.88 N/R N/R 2,000,000 2,031,660
11/15/97 7.38 N/R N/R 3,000,000 3,098,220
05/15/98 6.13 N/R N/R 3,000,000 3,030,330
05/31/98 5.38 N/R N/R 3,000,000 2,977,410
09/30/99 7.13 N/R N/R 2,000,000 2,091,460
10/31/99 7.50 N/R N/R 2,000,000 2,119,820
11/30/99 7.75 N/R N/R 3,000,000 3,208,860
01/15/00 6.38 N/R N/R 3,000,000 3,063,570
02/15/01 7.75 N/R N/R 2,000,000 2,172,040
05/15/05 6.50 N/R N/R 3,000,000 3,103,590
FEDERAL HOME LOAN MORTGAGE CORPORATION, POOL 216072
01/01/02 9.00 Agy N/R 157,516 164,161
FEDERAL HOME LOAN MORTGAGE CORPORATION (GTD), SERIES B-78
09/15/08 9.00 Agy N/R 53,452 63,818
FEDERAL HOME LOAN MORTGAGE CORPORATION (GTD), SERIES D-79
09/15/09 12.45 Agy N/R 40,762 44,982
FEDERAL HOME LOAN MORTGAGE CORPORATION, POOL 170027
03/01/10 14.75 Agy N/R 63,441 72,442
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION, POOL 354677
10/15/23 7.50 Agy N/R 2,306,392 2,338,826
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION, POOL 354713
12/15/23 7.50 Agy N/R 1,994,068 2,022,109
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION, POOL 354765
02/15/24 7.00 Agy N/R 2,919,888 2,902,551
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION, POOL 354790
04/15/24 6.50 Agy N/R 5,117,510 4,975,179
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION, POOL 354827
05/15/24 7.00 Agy N/R 2,887,611 2,870,894
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION, POOL 385623
05/15/24 7.00 Agy N/R 2,909,487 2,892,212
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION, POOL 780035
07/15/24 6.50 Agy N/R 3,055,063 2,973,913
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION, POOL 369524
09/15/24 8.00 Agy N/R 2,435,128 2,508,182
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION, POOL 780075
03/15/25 8.00 Agy N/R 2,885,592 2,982,980
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION II, POOL 2077
09/20/25 7.00 Agy N/R 1,997,305 1,970,466
-----------
TOTAL U.S. GOVERNMENT & AGENCY OBLIGATIONS
(Cost $63,360,340)........................ 65,831,634
-----------
CORPORATE BONDS AND NOTES - 14.6%
CONSUMER NON-DURABLES - 2.2%
Nabisco, Inc.
07/15/07 7.05 Baa2 BBB 2,000,000 1,997,500
-----------
FINANCE - 9.9%
Bankers Trust of New York Subordinated Debt
03/15/97 8.00 A3 A 1,000,000 1,025,000
J.P. Morgan & Co.
11/15/98 7.63 Aa3 AA 1,500,000 1,569,375
Lehman Brothers
05/01/07 8.50 Baa1 A 3,500,000 3,850,000
Salomon Brothers
02/16/98 8.90 Baa1 BBB 2,300,000 2,397,750
-----------
TOTAL FINANCE............................... 8,842,125
-----------
TRANSPORTATION - 2.4%
AMR Corp.
08/13/98 9.27% Baa3 BB+ 1,000,000 1,053,750
GPA Delaware, Inc.
12/15/98 8.75 Caa CCC+ 1,250,000 1,117,188
-----------
<CAPTION>
Ratings - Unaudited
Due ---------------------- Principal Value
Date Coupon (Moody's) (S&P) Amount (Note 1)
- --------- ------- ----------- ------- ---------- -----------
<S> <C>
TOTAL TRANSPORTATION........................ $ 2,170,938
-----------
TOTAL CORPORATE BONDS AND NOTES
(Cost $12,737,163)........................ 13,010,563
-----------
COLLATERALIZED MORTGAGE OBLIGATIONS - 1.7%
FEDERAL HOME LOAN MORTGAGE CORPORATION, SERIES 40, CLASS E
06/15/19 10.00% Agy N/R $ 612,948 632,652
FEDERAL NATIONAL MORTGAGE ASSOCIATION, SERIES 1989-27, CLASS D
01/25/16 10.00 Agy N/R 449,037 463,337
GOLDMAN SACHS TRUST 2, SERIES B, CLASS 3
07/01/17 8.95 Aaa AAA 299,188 313,942
GOLDMAN SACHS TRUST 2, SERIES D, CLASS 3
08/01/17 9.20 Aaa AAA 92,957 98,143
MDC ASSET INVESTOR'S TRUST 2, SERIES V, CLASS 2
12/01/17 9.33 Aaa AAA 20,457 21,017
-----------
TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS
(Cost $1,564,796)......................... 1,529,091
-----------
FOREIGN BONDS - 1.9%
MEXICAN CETES, SERIES 960104
01/04/96 0.00 N/R N/R MXN 7,474,870 974,750
MEXICAN CETES, SERIES 960118
01/18/96 0.00 N/R N/R MXN 5,418,420 695,669
-----------
TOTAL FOREIGN BONDS
(Cost $2,003,741)......................... 1,670,419
-----------
YANKEE BONDS - 4.5%
Export-Import Bank of Korea
11/01/96 7.85 A1 AA- 1,000,000 1,015,000
Quebec Province
07/15/23 7.50 A2 A+ 3,000,000 3,007,500
-----------
TOTAL YANKEE BONDS
(Cost $3,991,611)......................... 4,022,500
-----------
Maturity
Amount
----------
REPURCHASE AGREEMENT - 3.6%
CS First Boston, Inc., 5.87%, dated
10/31/95, due 11/01/95, collateralized by
$2,121,000 U.S. Treasury Bond 11.25% due
02/15/15.................................. $3,239,904 3,239,376
-----------
TOTAL INVESTMENTS - 100%
(Cost $86,897,027)........................ $89,303,583
==========
- ---------------
MXN - Mexican Peso
N/R - Not Rated
INCOME TAX INFORMATION:
At October 31, 1995, the net unrealized appreciation
based on cost for income tax purposes of $86,897,027
was as follows:
Aggregate gross unrealized appreciation for all
investments in which there was an excess of value over
tax cost $ 2,831,608
Aggregate gross unrealized depreciation for all
investments in which there was an excess of tax cost
over value (425,052)
-----------
Net unrealized appreciation $ 2,406,556
==========
OTHER INFORMATION:
Purchases and sales of securities, other than short-term
securities and U.S. Government and Agency securities,
for the six months ended October 31, 1995 aggregated
$10,918,279 and $3,013,220, respectively.
Purchases and sales of U.S. Government and Agency
securities, other than short-term securities, for the
six months ended October 31, 1995 aggregated $32,536,833
and $23,600,778, respectively.
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 22
INCOME PORTFOLIO
FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
October 31, 1995
<TABLE>
<S> <C> <C>
ASSETS:
Investments, at value (Cost $86,897,027)
(Note 1)................................... $89,303,583
Receivable for Portfolio shares sold......... 366,745
Interest receivable.......................... 1,473,227
Organization costs (Note 1).................. 11,000
-----------
Total assets............................. 91,154,555
LIABILITIES:
Payable for investments purchased............ $1,007,792
Payable for Portfolio shares redeemed........ 4,000
Dividends payable............................ 524,255
Advisory fees payable........................ 35,833
Administration and distribution fees
payable.................................... 10,790
Other payables and accrued expenses.......... 10,420
----------
Total liabilities........................ 1,593,090
-----------
NET ASSETS................................... $89,561,465
===========
Net Assets consist of:
Paid in capital.............................. $88,422,897
Accumulated distributions in excess of net
interest income............................ (260,501)
Accumulated net realized loss on
investments................................ (1,007,487)
Net unrealized appreciation in value of
investments................................ 2,406,556
-----------
NET ASSETS................................... $89,561,465
===========
INSTITUTIONAL CLASS:
NET ASSET VALUE, offering price and
redemption price per share ($88,069,903 /
8,760,943 shares outstanding).............. $10.05
=====
RETAIL CLASS:
NET ASSET VALUE, offering price and
redemption price per share ($1,491,562 /
146,815 shares outstanding)................ $10.16
=====
</TABLE>
STATEMENT OF OPERATIONS
Six months ended October 31, 1995
<TABLE>
<S> <C> <C>
INTEREST INCOME................................ $2,918,603
EXPENSES:
Advisory fee (Note 2).......................... $185,755
Administration and distribution fees (Note
2)........................................... 55,726
Transfer agent fee:
Retail Class................................. 8,000
Registration fee............................... 6,300
Distribution fee: (Note 3)
Retail Class................................. 1,176
Shareholder servicing fee: (Note 3)
Retail Class................................. 588
Custodian fees and expenses.................... 7,631
Trustees' compensation......................... 895
Audit.......................................... 2,870
Legal.......................................... 3,840
Miscellaneous.................................. 11,012
--------
Total expenses before waivers.............. 283,793
Waivers of expenses (Note 4)................... (9,899) 273,894
-------- ----------
Net interest income............................ 2,644,709
Net realized gain on:
Investments.................................. 859,564
Foreign currency transactions................ 42,346
----------
Total net realized gain........................ 901,910
Change in net unrealized depreciation.......... 2,435,410
----------
Net increase in net assets resulting from
operations................................... $5,982,029
==========
</TABLE>
- ---------------
The accompanying notes are an integral part of the financial statements.
<PAGE> 23
INCOME PORTFOLIO
FINANCIAL STATEMENTS (UNAUDITED) - continued
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Six months ended
October 31, 1995 Year ended
(Unaudited) April 30, 1995
---------------- --------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net interest income......................................................................... $ 2,644,709 $ 3,367,811
Net realized gain (loss) on investments and foreign currency transactions................... 901,910 (2,171,763)
Change in net unrealized appreciation (depreciation)........................................ 2,435,410 2,393,128
------------ ------------
Net increase in net assets resulting from operations.......................................... 5,982,029 3,589,176
------------ ------------
DISTRIBUTIONS:
Net interest income:
Institutional Class......................................................................... (2,633,525) (3,384,094)
Retail Class................................................................................ (30,139) (5,711)
Net realized gain:
Institutional Class......................................................................... -- (166,407)
Retail Class................................................................................ -- (108)
------------ ------------
Net decrease in net assets resulting from distributions....................................... (2,663,664) (3,556,320)
------------ ------------
SHARE TRANSACTIONS(1):
Proceeds from sales of shares................................................................. 32,951,902 26,167,406
Reinvested dividends.......................................................................... 30,274 6,904
Cost of shares redeemed....................................................................... (13,476,184) (13,788,690)
------------ ------------
Net increase in net assets resulting from share transactions.................................. 19,505,992 12,385,620
------------ ------------
Total increase in net assets.............................................................. 22,824,357 12,418,476
NET ASSETS:
Beginning of period......................................................................... 66,737,108 54,318,632
------------ ------------
End of period (including distributions in excess of net interest income of $(260,501)
and $(241,546), respectively)............................................................. $ 89,561,465 $ 66,737,108
============ ============
- ---------------------------------------------------------------------------------------------------------------------------------
(1) Dollars issued and redeemed:
Institutional Class:
Issued...................................................................................... $ 31,727,011 $ 25,893,232
Distributions reinvested.................................................................... 563 993
Redeemed.................................................................................... (13,396,721) (13,773,379)
------------ ------------
Net increase.................................................................................. $ 18,330,853 $ 12,120,846
============ ============
Retail Class:
Issued...................................................................................... $ 1,224,891 $ 274,174
Distributions reinvested.................................................................... 29,711 5,911
Redeemed.................................................................................... (79,463) (15,311)
------------ ------------
Net increase.................................................................................. $ 1,175,139 $ 264,774
============ ============
Shares issued and redeemed:
Institutional Class:
Issued...................................................................................... 3,177,946 2,728,738
Distributions reinvested.................................................................... 57 105
Redeemed.................................................................................... (1,340,944) (1,452,298)
------------ ------------
Net increase.................................................................................. 1,837,059 1,276,545
============ ============
Retail Class:
Issued...................................................................................... 121,262 28,313
Distributions reinvested.................................................................... 2,943 614
Redeemed.................................................................................... (7,814) (1,599)
------------ ------------
Net increase.................................................................................. 116,391 27,328
============ ============
</TABLE>
- ---------------
The accompanying notes are an integral part of the financial statements.
<PAGE> 24
INCOME PORTFOLIO
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
Institutional Class
----------------------------------------------------------
Six months ended Period from
October 31, 1995 Year ended July 19, 1993**
(Unaudited) April 30, 1995 to April 30, 1994
---------------- -------------- ------------------
<S> <C> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period................................. $ 9.60 $ 9.61 $ 10.00
------- ------- -------
Income from investment operations:
Net interest income.................................................. 0.36 0.58 0.38
Net realized and unrealized gain (loss) on investments............... 0.44 0.02 (0.38)
------- ------- -------
Total from investment operations..................................... 0.80 0.60 0.00
------- ------- -------
Distributions:
Net interest income.................................................. (0.35) (0.58) (0.38)
Net realized gain.................................................... 0.00 (0.03) (0.01)
------- ------- -------
Total distributions.................................................. (0.35) (0.61) (0.39)
------- ------- -------
Net asset value, end of period....................................... $ 10.05 $ 9.60 $ 9.61
======= ======= =======
TOTAL RETURN......................................................... 8.53%# 6.53% (0.08)%#
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (thousands)................................ $ 88,070 $ 66,441 $ 54,289
Ratio of expenses to average daily net assets........................ 0.73%* 0.74% 0.77%*
Ratio of net interest income to average daily net assets............. 7.12%* 6.15% 4.90%*
Portfolio turnover rate.............................................. 76%* 73% 20%*
</TABLE>
<TABLE>
<CAPTION>
Retail Class
----------------------------------------------------------
Six months ended Year ended Period from
October 31, 1995 April 30, April 13, 1994**
(Unaudited) 1995++ to April 30, 1994
---------------- -------------- ------------------
<S> <C> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period................................. $ 9.72 $ 9.62 $ 9.69
------ ------ ------
Income from investment operations:
Net interest income.................................................. 0.34 0.55 0.02
Net realized and unrealized gain (loss) on investments............... 0.45 0.05 (0.06)
------ ------ ------
Total from investment operations..................................... 0.79 0.60 (0.04)
------ ------ ------
Distributions:
Net interest income.................................................. (0.35) (0.47) (0.03)
Net realized gain.................................................... 0.00 (0.03) 0.00
------ ------ ------
Total distributions.................................................. (0.35) (0.50) (0.03)
------ ------ ------
Net asset value, end of period....................................... $ 10.16 $ 9.72 $ 9.62
====== ====== ======
TOTAL RETURN......................................................... 8.21%+# 6.45%+ (0.41)%+#
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (thousands)................................ $ 1,491 $ 296 $ 30
Ratio of expenses to average daily net assets(1)..................... 1.22%* 1.23% 1.72%*
Ratio of net interest income to average daily net assets............. 6.63%* 5.66% 3.95%*
Portfolio turnover rate.............................................. 76%* 73% 20%*
- ---------------
* Annualized
** Commencement of operations
+ Total return does not include the one time sales charge. Total
return would have been lower had certain fees not been
reimbursed during the period.
++ Calculation is based on average shares outstanding.
# Total return for periods of less than one year are not
annualized.
(1) During the period, certain fees were voluntarily waived. The
ratio of expenses to average daily net assets had such waivers
not occurred is as follows...................................... 3.75%* 27.63% 55.35%*
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 25
ARK FUNDS: GROWTH AND INCOME PORTFOLIO
PORTFOLIO OF INVESTMENTS / OCTOBER 31, 1995 (UNAUDITED)
(Showing Percentage of Total Value of Investments)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Value
Shares (Note 1)
------- -----------
<S> <C> <C>
COMMON STOCKS - 55.7%
BASIC INDUSTRY - 4.5%
Dow Chemical Co................................ 9,000 $ 617,625
IMC Fertilizer Group, Inc...................... 8,000 560,000
International Paper Co......................... 18,000 666,000
Lukens, Inc.................................... 19,000 584,250
Minerals Technologies Inc...................... 15,000 598,125
Morton International, Inc...................... 25,000 762,500
Reynolds Metals Co............................. 5,000 251,875
W.R. Grace & Co................................ 8,500 473,875
---------
TOTAL BASIC INDUSTRY........................... 4,514,250
---------
BUSINESS SERVICES - 0.1%
Global DirectMail Corp......................... 5,000 136,250
---------
CAPITAL GOODS - 4.2%
Brenco, Inc.................................... 58,000 674,250
Browning-Ferris Industries, Inc................ 20,000 582,500
Caterpillar, Inc............................... 8,000 449,000
Fluor Corp..................................... 11,000 621,500
Handex Environmental Recovery, Inc.*........... 75,682 473,012
Keystone International, Inc.................... 23,500 522,875
Safety Kleen Corp.............................. 20,000 307,500
Trinity Industries............................. 15,000 444,375
WMX Technologies, Inc.......................... 6,600 185,625
---------
TOTAL CAPITAL GOODS............................ 4,260,637
---------
CONSUMER DURABLES - 2.5%
Ford Motor Co.................................. 17,200 494,500
Gentex Corp.*.................................. 15,000 333,750
Magna International Inc., Class A.............. 22,000 951,500
Top Source Technologies, Inc.*................. 100,000 731,250
---------
TOTAL CONSUMER DURABLES........................ 2,511,000
---------
CONSUMER NON-DURABLES - 9.6%
Borders Group, Inc............................. 15,000 256,875
Circus Circus Enterprises, Inc.*............... 25,000 665,625
Colgate-Palmolive Co........................... 12,000 831,000
Darden Restaurants, Inc........................ 50,000 568,750
Evergreen Media Corp., Class A*................ 20,000 545,000
Gap, Inc....................................... 18,000 708,750
General Mills, Inc............................. 15,000 860,625
Home Depot, Inc................................ 16,000 596,000
Nordstrom, Inc................................. 12,000 444,750
OfficeMax, Inc................................. 11,250 278,438
Philip Morris Cos., Inc........................ 7,500 633,750
Procter & Gamble Co............................ 460 37,260
Reebok International Ltd....................... 15,000 510,000
Showboat, Inc.................................. 40,000 960,000
Time Warner, Inc............................... 20,000 730,000
Warnaco Group, Inc............................. 45,000 1,046,250
---------
TOTAL CONSUMER NON-DURABLES.................... 9,673,073
---------
ENERGY - 7.9%
Amoco Co....................................... 9,000 574,875
Anadarko Petroleum Corp........................ 22,000 954,250
Baker Hughes, Inc.............................. 15,000 294,375
Burlington Resources, Inc...................... 22,000 792,000
Sonat, Inc..................................... 15,000 431,250
Sonat Offshore Drilling, Inc................... 12,500 396,875
Triton Energy Corp............................. 85,000 3,963,125
Unocal Corp.................................... 18,000 472,500
---------
TOTAL ENERGY................................... 7,879,250
---------
ENGINEERING & CONSTRUCTION - 0.5%
Empresas ICA S.A. ADR.......................... 48,000 456,000
---------
<CAPTION>
Value
Shares (Note 1)
------- -----------
<S> <C> <C>
FINANCE - 4.7%
Chubb Corp..................................... 7,000 $ 629,125
Federal Home Loan Mortgage Corp................ 7,500 519,375
Federal National Mortgage Association.......... 6,600 692,175
First Chicago Corp............................. 9,000 610,875
Fleet Financial Group, Inc..................... 12,000 465,000
Franklin Resources, Inc........................ 7,000 355,250
Marshall & Isley Corp.......................... 35,000 848,750
Norwest Corp................................... 20,000 590,000
---------
TOTAL FINANCE.................................. 4,710,550
---------
HEALTH CARE - 5.6%
Abbott Laboratories............................ 13,100 520,725
Alza Corp., Class A*........................... 30,000 660,000
American Home Products Corp.................... 5,500 487,438
AmeriSource Health Corp........................ 7,500 204,375
Bristol Myers Squibb Co........................ 6,000 457,500
Columbia/HCA Healthcare Corp................... 16,000 786,000
Humana, Inc.*.................................. 35,000 739,375
Pfizer, Inc.................................... 16,000 918,000
United Healthcare Corp......................... 15,000 796,875
---------
TOTAL HEALTH CARE.............................. 5,570,288
---------
TECHNOLOGY - 12.1%
Adaptec, Inc.*................................. 15,000 667,500
American Express 'DECS'........................ 12,000 658,500
Bay NetWorks, Inc.*............................ 15,000 993,750
Computer Associates International, Inc......... 8,000 440,000
Dataworks Corp................................. 7,500 104,063
Gasonics International Corp.*.................. 20,000 660,000
Hewlett-Packard Co............................. 10,000 926,250
Intel Corp..................................... 10,000 698,750
LeCroy Corp.................................... 50,000 612,500
LSI Logic Corp.*............................... 10,000 471,250
Motorola Inc................................... 11,000 721,875
Oracle System Corp.*........................... 8,000 349,000
Silicon Valley Group, Inc.*.................... 15,000 485,625
StorMedia, Inc................................. 12,000 552,000
Sun Microsystems, Inc.*........................ 10,000 780,000
Symantec Corp.*................................ 35,000 850,937
Teltrend, Inc.*................................ 28,500 840,750
Telxon Corp.................................... 30,000 693,750
Texas Instruments, Inc......................... 10,000 682,500
---------
TOTAL TECHNOLOGY............................... 12,189,000
---------
TRANSPORTATION - 1.8%
Atlas Air, Inc................................. 9,000 133,875
CSX Corp....................................... 5,000 418,750
Delta Air Lines, Inc........................... 5,000 328,125
Mesa Airlines, Inc.*........................... 50,000 475,000
Southwest Airlines Co.......................... 20,000 400,000
---------
TOTAL TRANSPORTATION........................... 1,755,750
---------
UTILITIES - 2.2%
AT&T Corp...................................... 14,000 896,000
SBC Communications, Inc........................ 14,000 782,250
Telefonos de Mexico S.A., Class L, ADR......... 20,500 563,750
---------
TOTAL UTILITIES................................ 2,242,000
---------
TOTAL COMMON STOCKS (Cost $51,699,221)......... 55,898,048
---------
CONVERTIBLE PREFERRED STOCKS - 0.3%
BASIC INDUSTRY - 0.3%
Reynolds Metals Co. 7.00% (Cost $336,350)...... 7,000 350,000
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 26
GROWTH AND INCOME PORTFOLIO
PORTFOLIO OF INVESTMENTS / OCTOBER 31, 1995 (UNAUDITED) - continued
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Value
Shares (Note 1)
------- -----------
<S> <C> <C>
OTHER INVESTMENTS - 1.4%
Fidelity Advisor Emerging Asia Fund, Inc....... 20,000 $ 237,500
France Growth Fund, Inc........................ 72,000 693,000
The India Fund, Inc............................ 30,000 251,250
Mexico Fund, Inc............................... 17,333 212,329
-----------
TOTAL OTHER INVESTMENTS
(Cost $1,883,657)............................ 1,394,079
-----------
</TABLE>
<TABLE>
<CAPTION>
Ratings - Unaudited
Due ---------------------- Principal
Date Coupon (Moody's) (S&P) Amount
- --------- ------- ----------- ------- ----------
<S> <C>
CORPORATE BONDS - 3.5%
CONSUMER NON-DURABLES - 1.0%
Nabisco, Inc.
07/15/07 7.05% Baa2 BBB $1,000,000 998,750
------------
FINANCE - 2.5%
Associates Corp.
05/01/97 9.70 Aa3 AA- 500,000 526,875
GPA Delaware, Inc.
12/15/98 8.75 Caa CCC 800,000 715,000
Inter-American
Development Bank
10/15/97 9.50 Aaa AAA 200,000 213,250
Lehman Brothers
05/01/07 8.50 Baa1 A 1,000,000 1,100,000
------------
TOTAL FINANCE............................... 2,555,125
------------
TOTAL CORPORATE BONDS & NOTES
(Cost $3,445,280)......................... 3,553,875
------------
CONVERTIBLE CORPORATE BONDS - 0.3%
OTHER - 0.3%
Consorcio Group
08/08/04 8.00% N/R N/R 852,000 323,760
(Cost $766,800) ------------
U.S. GOVERNMENT & AGENCY OBLIGATIONS - 30.9%
U.S. TREASURY BONDS
11/15/21 8.00 N/R N/R 3,000,000 3,585,179
11/15/22 7.63 N/R N/R 1,000,000 1,153,020
U.S. TREASURY NOTES
02/28/97 6.88 N/R N/R 1,500,000 1,523,745
11/15/97 7.38 N/R N/R 4,000,000 4,130,960
04/15/98 7.88 N/R N/R 1,500,000 1,574,415
10/31/99 7.50 N/R N/R 1,500,000 1,589,865
02/15/00 8.50 N/R N/R 1,500,000 1,650,675
02/15/01 7.75 N/R N/R 2,000,000 2,172,040
11/15/01 7.50 N/R N/R 1,500,000 1,621,815
05/15/05 6.50 N/R N/R 1,000,000 1,034,530
FEDERAL HOME LOAN MORTGAGE CORPORATION, POOL 200058
11/01/01 8.50 Agy N/R 72,049 74,211
FEDERAL HOME LOAN MORTGAGE CORPORATION, POOL 216072
01/01/02 9.00 Agy N/R 176,323 183,762
FEDERAL HOME LOAN MORTGAGE CORPORATION, POOL 380005
07/01/02 9.50 Agy N/R 16,906 17,672
FEDERAL HOME LOAN MORTGAGE CORPORATION, POOL E46188
04/01/08 6.50 Agy N/R 1,201,201 1,192,942
<CAPTION>
Ratings - Unaudited
Due ---------------------- Principal Value
Date Coupon (Moody's) (S&P) Amount (Note 1)
- --------- ------- ----------- ------- ---------- ------------
<S> <C>
FEDERAL HOME LOAN MORTGAGE CORPORATION, POOL 546392
02/01/20 10.00 Agy N/R $ 278,900 $ 301,735
FEDERAL NATIONAL MORTGAGE ASSOCIATION, POOL 2468
12/01/00 10.50 Agy N/R 14,025 14,849
FEDERAL NATIONAL MORTGAGE ASSOCIATION, POOL 124221
02/01/07 7.00 Agy N/R 546,872 551,145
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION, POOL 354677
10/15/23 7.50 Agy N/R 1,385,830 1,405,318
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION, POOL 354713
12/15/23 7.50 Agy N/R 1,327,560 1,346,227
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION, POOL 354765
02/15/24 7.00 Agy N/R 1,459,944 1,451,275
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION, POOL 354827
05/15/24 7.00 Agy N/R 1,443,806 1,435,447
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION, POOL 385623
05/15/24 7.00 Agy N/R 1,454,744 1,446,106
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION, POOL 369524
09/15/24 8.00 Agy N/R 1,497,459 1,542,383
------------
TOTAL U.S. GOVERNMENT & AGENCY
OBLIGATIONS (Cost $29,310,064)............ 30,999,316
------------
COLLATERALIZED MORTGAGE OBLIGATIONS - 0.7%
CMO TRUST, SERIES 57, CLASS C
09/01/16 9.90% Aaa AAA 119,465 121,821
FEDERAL NATIONAL MORTGAGE ASSOCIATION, SERIES 1988-23,
CLASS C
09/25/18 9.75 Agy N/R 345,602 366,520
GOLDMAN SACHS TRUST, SERIES D, CLASS 3
08/01/17 9.20 Aaa AAA 79,678 84,124
MDC ASSET INVESTOR'S TRUST CMO, SERIES XII, CLASS 3
03/01/18 8.94 N/R AAA 73,932 76,868
------------
TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS
(Cost $659,814)........................... 649,333
------------
FOREIGN BOND - 1.9%
MEXICAN CETES, SERIES 960104
01/04/96 0.00 Baa3 BBB+ MXN 14,949,750 1,949,502
------------
(Cost $2,246,828)
<CAPTION>
Maturity
Amount
----------
<S> <C> <C>
REPURCHASE AGREEMENT - 5.3%
CS First Boston, Inc., 5.87%, dated
10/31/95, due 11/01/95, collateralized by
$3,462,000 U.S. Treasury Bond 11.25% due
02/15/15.................................. $5,288,306 5,287,444
------------
TOTAL INVESTMENTS - 100%
(Cost $95,635,458)...................... $100,405,357
===========
</TABLE>
- ---------------
N/R - Not Rated
ADR - American Depositary Receipt
DECS - Debt Exchangable for Common Stock
MXN - Mexican Peso
* Non-income producing
The accompanying notes are an integral part of the financial statements.
<PAGE> 27
GROWTH AND INCOME PORTFOLIO
PORTFOLIO OF INVESTMENTS / OCTOBER 31, 1995 (UNAUDITED) - continued
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
INCOME TAX INFORMATION:
At October 31, 1995, the net unrealized appreciation
based on cost for income tax purposes of $95,635,458
was as follows:
Aggregate gross unrealized appreciation for all
investments in which there was an excess of value over
tax cost $ 8,637,962
Aggregate gross unrealized depreciation for all
investments in which there was an excess of tax cost
over value (3,868,063)
-----------
Net unrealized appreciation $ 4,769,899
==========
OTHER INFORMATION:
Purchases and sales of securities, other than short-term
securities and U.S. Government and Agency securities,
for the six months ended October 31, 1995 aggregated
$50,286,466 and $50,630,388, respectively.
Purchases and sales of U.S. Government and Agency
securities, other than short-term securities, for the
six months ended October 31, 1995 aggregated $3,838,468
and $5,527,507, respectively.
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 28
GROWTH AND INCOME PORTFOLIO
FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
October 31, 1995
<TABLE>
<S> <C> <C>
ASSETS:
Investments, at value (Cost $95,635,458)
(Note 1).................................. $100,405,357
Receivable for Portfolio shares sold........ 98,112
Receivable for investments sold............. 1,488,517
Interest receivable......................... 657,364
Dividends receivable........................ 54,784
Organization costs (Note 1)................. 11,000
------------
Total assets............................ 102,715,134
LIABILITIES:
Payable for investments purchased........... $1,238,572
Payable for Portfolio shares redeemed....... 3,500
Advisory fees payable....................... 47,274
Administration and distribution fees
payable................................... 12,604
Other payables and accrued expenses......... 11,280
----------
Total liabilities....................... 1,313,230
------------
NET ASSETS.................................. $101,401,904
============
Net Assets consist of:
Paid in capital............................. $ 93,211,304
Accumulated distributions in excess of net
investment income......................... (226,093)
Accumulated undistributed net realized gain
on investments............................ 3,646,794
Net unrealized appreciation in value of
investments............................... 4,769,899
------------
NET ASSETS.................................. $101,401,904
============
INSTITUTIONAL CLASS:
NET ASSET VALUE, offering price and
redemption price per share
($100,307,997 / 9,164,951 shares
outstanding).............................. $10.94
=====
RETAIL CLASS:
NET ASSET VALUE, offering price and
redemption price per share
($1,093,907 / 100,033 shares
outstanding).............................. $10.94
=====
</TABLE>
STATEMENT OF OPERATIONS
Six months ended October 31, 1995
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Dividends..................................... $ 453,755
Interest...................................... 1,839,664
-----------
Total investment income................... 2,293,419
EXPENSES:
Advisory fee (Note 2)......................... $272,602
Administration and distribution fees (Note
2).......................................... 74,346
Transfer agent fee:
Retail Class................................ 7,500
Registration fee.............................. 6,190
Distribution fee: (Note 3)
Retail Class................................ 1,445
Shareholder servicing fee: (Note 3)
Retail Class................................ 542
Custodian fees and expenses................... 15,716
Trustees' compensation........................ 836
Audit......................................... 3,330
Legal......................................... 4,580
Miscellaneous................................. 6,086
--------
Total expenses before waivers............. 393,173
Waivers of expenses (Note 4).................. (9,775) 383,398
-------- -----------
Net investment income......................... 1,910,021
Net realized gain on:
Investments................................. 5,768,068
Foreign currency transactions............... 88,350
-----------
Total net realized gain....................... 5,856,418
Change in net unrealized appreciation......... 2,379,389
-----------
Net increase in net assets resulting from
operations.................................. $10,145,828
===========
</TABLE>
- ---------------
The accompanying notes are an integral part of the financial statements.
<PAGE> 29
GROWTH AND INCOME PORTFOLIO
FINANCIAL STATEMENTS (UNAUDITED) - continued
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Six months ended
October 31, 1995 Year ended
(Unaudited) April 30, 1995
---------------- --------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income....................................................................... $ 1,910,021 $ 2,951,999
Net realized gain (loss) on investments and foreign currency transactions................... 5,856,418 (2,147,846)
Change in net unrealized appreciation (depreciation)........................................ 2,379,389 2,486,940
------------ ------------
Net increase in net assets resulting from operations.......................................... 10,145,828 3,291,093
------------ ------------
DISTRIBUTIONS:
Net investment income:
Institutional Class......................................................................... (2,006,188) (2,567,217)
Retail Class................................................................................ (13,186) (10,649)
Net realized gain:
Institutional Class......................................................................... -- (1,672,129)
Retail Class................................................................................ -- (5,985)
------------ ------------
Net decrease in net assets resulting from distributions....................................... (2,019,374) (4,255,980)
------------ ------------
SHARE TRANSACTIONS(1):
Proceeds from sales of shares................................................................. 10,124,003 20,945,032
Reinvested dividends.......................................................................... 13,524 18,249
Cost of shares redeemed....................................................................... (8,449,760) (16,784,738)
------------ ------------
Net increase in net assets resulting from share transactions.................................. 1,687,767 4,178,543
------------ ------------
Total increase in net assets.............................................................. 9,814,221 3,213,656
NET ASSETS:
Beginning of period......................................................................... 91,587,683 88,374,027
------------ ------------
End of period (including distributions in excess of net investment income of $(226,093)
and $(116,740), respectively)............................................................. $101,401,904 $ 91,587,683
============ ============
- ---------------------------------------------------------------------------------------------------------------------------------
(1) Dollars issued and redeemed:
Institutional Class:
Issued...................................................................................... $ 9,609,319 $ 20,507,711
Distributions reinvested.................................................................... 339 799
Redeemed.................................................................................... (8,418,985) (16,709,451)
------------ ------------
Net increase.................................................................................. $ 1,190,673 $ 3,799,059
============ ============
Retail Class:
Issued...................................................................................... $ 514,684 $ 437,321
Distributions reinvested.................................................................... 13,185 17,450
Redeemed.................................................................................... (30,775) (75,287)
------------ ------------
Net increase.................................................................................. $ 497,094 $ 379,484
============ ============
Shares issued and redeemed:
Institutional Class:
Issued...................................................................................... 878,872 2,073,212
Distributions reinvested.................................................................... 31 82
Redeemed.................................................................................... (777,736) (1,693,049)
------------ ------------
Net increase.................................................................................. 101,167 380,245
============ ============
Retail Class:
Issued...................................................................................... 47,001 44,196
Distributions reinvested.................................................................... 1,219 1,780
Redeemed.................................................................................... (2,849) (7,646)
------------ ------------
Net increase.................................................................................. 45,371 38,330
============ ============
</TABLE>
- ---------------
The accompanying notes are an integral part of the financial statements.
<PAGE> 30
GROWTH AND INCOME PORTFOLIO
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
Institutional Class
---------------------------------------------------------
Six months ended Period from
October 31, 1995 Year ended June 14, 1993**
(Unaudited) April 30, 1995 to April 30, 1994
------------------- -------------- ------------------
<S> <C> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period.................................. $ 10.04 $ 10.16 $ 10.00
-------- ------- -------
Income from investment operations:
Net investment income................................................. 0.21 0.33 0.19
Net realized and unrealized gain on investments and foreign currency
transactions........................................................ 0.91 0.03 0.17
-------- ------- -------
Total from investment operations...................................... 1.12 0.36 0.36
-------- ------- -------
Distributions:
Net investment income................................................. (0.22) (0.29) (0.19)
Net realized gain..................................................... 0.00 (0.19) (0.01)
-------- ------- -------
Total distributions................................................... (0.22) (0.48) (0.20)
-------- ------- -------
Net asset value, end of period........................................ $ 10.94 $ 10.04 $ 10.16
======== ======= =======
TOTAL RETURN.......................................................... 11.09%# 3.75% 3.56%#
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (thousands)................................. $ 100,308 $ 91,039 $ 88,208
Ratio of expenses to average daily net assets......................... 0.77%* 0.77% 0.81%*
Ratio of net interest income to average daily net assets.............. 3.86%* 3.32% 2.41%*
Portfolio turnover rate............................................... 116%* 81% 37%*
</TABLE>
<TABLE>
<CAPTION>
Retail Class
---------------------------------------------------------
Six months ended Period from
October 31, 1995 Year ended March 9, 1994**
(Unaudited) April 30, 1995 to April 30, 1994
------------------- -------------- ------------------
<S> <C> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period.................................. $ 10.04 $ 10.15 $ 10.62
------- ------ ------
Income from investment operations:
Net interest income................................................... 0.21 0.27 0.01
Net realized and unrealized gain (loss) on investments and foreign
currency transactions............................................... 0.89 0.05 (0.43)
------- ------ ------
Total from investment operations...................................... 1.10 0.32 (0.42)
------- ------ ------
Distributions:
Net interest income................................................... (0.20) (0.24) (0.05)
Net realized gain..................................................... 0.00 (0.19) 0.00
------- ------ ------
Total distributions................................................... (0.20) (0.43) (0.05)
------- ------ ------
Net asset value, end of period........................................ $ 10.94 $ 10.04 $ 10.15
======= ====== ======
TOTAL RETURN.......................................................... 10.89%+# 3.33%+ (3.95)%+#
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (thousands)................................. $ 1,094 $ 549 $ 166
Ratio of expenses to average daily net assets(1)...................... 1.26%* 1.26% 1.86%*
Ratio of net investment income to average daily net assets............ 3.37%* 2.83% 1.36%*
Portfolio turnover rate............................................... 116%* 81% 37%*
- ---------------
* Annualized
** Commencement of operations
+ Total return does not include the one time sales charge. Total
return would have been lower had certain fees not been waived
during the period.
# Total return for periods of less than one year are not
annualized.
(1) During the period, certain fees were voluntarily waived. The
ratio of expenses to average daily net assets had such waivers
not occurred is as follows....................................... 3.97%* 5.80% 15.08%*
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 31
ARK FUNDS: CAPITAL GROWTH PORTFOLIO
PORTFOLIO OF INVESTMENTS / OCTOBER 31, 1995 (UNAUDITED)
(Showing Percentage of Total Value of Investments)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Value
Shares (Note 1)
---------- ------------
<S> <C> <C>
COMMON STOCKS - 86.3%
BASIC INDUSTRY - 1.2%
Sanifill, Inc.*............................... 20,000 $ 630,000
-----------
BUSINESS SERVICES - 5.0%
Fair Isaac & Company, Inc..................... 10,000 270,000
HBO & Co...................................... 10,000 707,500
La Quinta Inns, Inc........................... 18,500 476,375
Measurex Corp................................. 35,000 1,076,250
-----------
TOTAL BUSINESS SERVICES....................... 2,530,125
-----------
CAPITAL GOODS - 3.0%
Baker Hughes, Inc............................. 40,000 785,000
Danaher Corp.................................. 15,000 465,000
International Paper Co........................ 7,500 277,500
-----------
TOTAL CAPITAL GOODS........................... 1,527,500
-----------
CONSUMER DURABLES - 3.6%
Brookstone, Inc.*............................. 45,000 298,125
Colgate-Palmolive Co.......................... 15,000 1,038,750
Dollar General Corp........................... 20,000 490,000
-----------
TOTAL CONSUMER DURABLES....................... 1,826,875
-----------
CONSUMER NON-DURABLES - 9.9%
General Mills, Inc............................ 30,000 1,721,250
Mirage Resorts, Inc.*......................... 15,000 491,250
PepsiCo, Inc.................................. 10,000 527,500
RJR Nabisco Holdings Corp..................... 55,000 1,691,250
Tracor, Inc................................... 35,000 560,000
-----------
TOTAL CONSUMER NON-DURABLES................... 4,991,250
-----------
ENERGY - 6.3%
Anadarko Petroleum Corp....................... 22,000 954,250
Burlington Resources, Inc..................... 35,000 1,260,000
Triton Energy Corp............................ 20,000 932,500
-----------
TOTAL ENERGY.................................. 3,146,750
-----------
ENGINEERING & CONSTRUCTION - 0.5%
Aluminum Company of America................... 5,000 255,000
-----------
FINANCE - 13.6%
Aetna Life & Casualty Co...................... 10,000 703,750
American International Group, Inc............. 10,000 843,750
Citicorp...................................... 15,000 973,125
Countrywide Credit Industries, Inc............ 30,000 663,750
Crestar Financial Corp........................ 10,000 570,000
Marshall & Isley Corp......................... 25,000 606,250
Norwest Corp.................................. 25,000 737,500
PNC Bank Corp................................. 30,000 787,500
Prudential Reinsurance Holdings, Inc.......... 5,000 101,875
Salomon, Inc.................................. 25,000 903,125
-----------
TOTAL FINANCE................................. 6,890,625
-----------
HEALTH CARE - 14.4%
American Home Products Corp................... 10,000 886,250
Guidant Corp.................................. 25,000 800,000
Health Management Associates, Inc., Class
A*.......................................... 25,000 537,500
Humana, Inc.*................................. 50,000 1,056,250
Johnson & Johnson............................. 15,000 1,222,500
Pfizer, Inc................................... 25,000 1,434,375
PhyCor, Inc.*................................. 20,000 735,000
United Dental Care, Inc....................... 20,000 610,000
-----------
TOTAL HEALTH CARE............................. 7,281,875
-----------
<CAPTION>
Value
Shares (Note 1)
---------- ------------
<S> <C> <C>
TECHNOLOGY - 21.4%
3Com Corp.*................................... 5,000 $ 235,000
Adaptec, Inc.*................................ 5,000 222,500
America OnLine, Inc.*......................... 10,000 800,000
Applied Materials, Inc.*...................... 5,000 250,625
Bay Net Works, Inc.*.......................... 5,000 331,250
Cisco Systems, Inc.*.......................... 5,000 387,500
Clear Channel Communications, Inc.*........... 5,000 410,000
DSC Communications Corp.*..................... 5,000 185,000
Intel Corp.................................... 24,000 1,677,000
International Business Machines Corp.......... 10,000 972,500
Microsoft, Inc.*.............................. 10,000 1,000,000
Motorola Inc.................................. 5,000 328,125
Sanmina Corp.................................. 15,566 840,564
Simware, Inc.................................. 10,000 93,750
Symantec Corp.*............................... 23,500 571,344
Texas Instruments, Inc........................ 7,000 477,750
Thermo Electron Corp.*........................ 25,000 1,150,000
United Technologies Corp...................... 10,000 887,500
-----------
TOTAL TECHNOLOGY.............................. 10,820,408
-----------
TRANSPORTATION - 2.3%
Lockheed Martin Corp.......................... 17,000 1,158,125
-----------
UTILITIES - 5.1%
AT&T Corp..................................... 10,000 640,000
Bell Atlantic Corp............................ 8,000 509,000
PacifiCorp.................................... 25,000 471,875
U.S. West, Inc................................ 20,000 952,500
-----------
TOTAL UTILITIES............................... 2,573,375
-----------
TOTAL COMMON STOCKS (Cost $43,934,334)........ 43,631,908
-----------
WARRANTS - 1.5%
Intel Corp., expiring 3/14/98* (Cost
$720,625)................................... 20,000 740,000
-----------
<CAPTION>
Maturity
Amount
(000)
----------
<S> <C> <C>
REPURCHASE AGREEMENT - 12.2%
CS First Boston, Inc., 5.87%, dated 10/31/95,
due 11/01/95, collateralized by $4,044,000
U.S. Treasury Bond 11.25% due 02/15/15...... $6,175,975 6,174,968
-----------
TOTAL INVESTMENTS - 100%
(Cost $50,829,927).......................... $ 50,546,876
===========
</TABLE>
- ---------------
* Non-income producing
<TABLE>
<S> <C>
INCOME TAX INFORMATION:
At October 31, 1995, the net unrealized depreciation
based on cost for income tax purposes of $50,829,927
was as follows:
Aggregate gross unrealized appreciation for all
investments in which there was an excess of value over
tax cost $ 1,311,089
Aggregate gross unrealized depreciation for all
investments in which there was an excess of tax cost
over value (1,594,140)
-----------
Net unrealized depreciation $ (283,051)
===========
OTHER INFORMATION:
Purchases and sales of securities, other than short-term
securities and U.S. Government and Agency securities,
for the six months ended October 31, 1995 aggregated
$157,506,941 and $156,126,102, respectively.
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 32
CAPITAL GROWTH PORTFOLIO
FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
October 31, 1995
<TABLE>
<S> <C> <C>
ASSETS:
Investments, at value (Cost $50,829,927)
(Note 1)................................... $50,546,876
Receivable for Portfolio shares sold......... 16,205
Receivable for investments sold.............. 2,047,514
Interest receivable.......................... 1,007
Dividends receivable......................... 92,775
Organization costs (Note 1).................. 11,000
-----------
Total assets............................. 52,715,377
LIABILITIES:
Payable for investment purchased............. $6,843,057
Payable for Portfolio shares redeemed........ 5,172
Administration and distribution fees
payable.................................... 6,141
Other payables and accrued expenses.......... 9,770
----------
Total liabilities........................ 6,864,140
-----------
NET ASSETS................................... $45,851,237
===========
Net Assets consist of:
Paid in capital.............................. $42,900,276
Undistributed net investment income.......... 318,634
Accumulated undistributed net realized gain
on investments............................. 2,915,378
Net unrealized depreciation in value of
investments................................ (283,051)
-----------
NET ASSETS................................... $45,851,237
===========
INSTITUTIONAL CLASS:
NET ASSET VALUE, offering price and
redemption price per share
($44,354,985 / 4,076,348 shares
outstanding)............................... $10.88
=====
RETAIL CLASS:
NET ASSET VALUE, offering price and
redemption price per share
($1,496,252 / 137,930 shares
outstanding)............................... $10.85
=====
</TABLE>
STATEMENT OF OPERATIONS
Six months ended October 31, 1995
<TABLE>
<S> <C> <C>
INVESTMENT INCOME
Dividends..................................... $ 278,087
Interest...................................... 99,210
-----------
Total Investment Income................... 377,297
EXPENSES:
Advisory fee (Note 2)......................... $ 143,435
Administration and distribution fees (Note
2).......................................... 35,859
Transfer agent fee:
Retail Class................................ 7,500
Registration.................................. 6,370
Distribution fee: (Note 3)
Retail Class................................ 1,615
Shareholder servicing fee: (Note 3)
Retail Class................................ 606
Custodian fees and expenses................... 12,796
Trustees' compensation........................ 396
Audit......................................... 2,870
Legal......................................... 2,428
Miscellaneous................................. 3,482
---------
Total expenses before waivers............. 217,357
Waivers of expenses (Note 4).................. (153,192) 64,165
--------- -----------
Net investment income......................... 313,132
Net realized gain on investments.............. 5,635,536
Change in net unrealized depreciation......... (2,949,156)
-----------
Net increase in net assets resulting from
operations.................................. $ 2,999,512
==========
</TABLE>
- ---------------
The accompanying notes are an integral part of the financial statements.
<PAGE> 33
CAPITAL GROWTH PORTFOLIO
FINANCIAL STATEMENTS (UNAUDITED) - continued
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Six months ended
October 31, 1995 Year ended
(Unaudited) April 30, 1995
---------------- --------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income..................................................................... $ 313,132 $ 610,651
Net realized gain (loss) on investments................................................... 5,635,536 (2,229,746)
Change in net unrealized appreciation (depreciation)...................................... (2,949,156) 2,592,805
----------- ------------
Net increase in net assets resulting from operations........................................ 2,999,512 973,710
----------- ------------
DISTRIBUTIONS:
Net investment income:
Institutional Class....................................................................... (251,781) (507,523)
Retail Class.............................................................................. (1,786) (1,684)
Net realized gain:
Institutional Class....................................................................... (41,963) (839,096)
Retail Class.............................................................................. (447) (3,616)
----------- ------------
Net decrease in net assets resulting from distributions..................................... (295,977) (1,351,919)
----------- ------------
SHARE TRANSACTIONS(1):
Proceeds from sales of shares............................................................... 7,621,352 8,972,863
Reinvested dividends........................................................................ 2,336 5,719
Cost of shares redeemed..................................................................... (6,049,618) (19,346,340)
----------- ------------
Net increase (decrease) in net assets resulting from share transactions..................... 1,574,070 (10,367,758)
----------- ------------
Total increase (decrease) in net assets................................................. 4,277,605 (10,745,967)
NET ASSETS:
Beginning of period....................................................................... 41,573,632 52,319,599
----------- ------------
End of period (including undistributed net investment income of $318,634 and $259,069,
respectively)........................................................................... $ 45,851,237 $ 41,573,632
=========== ============
- ---------------------------------------------------------------------------------------------------------------------------------
(1) Dollars issued and redeemed:
Institutional Class:
Issued.................................................................................... $ 6,469,809 $ 8,654,083
Distributions reinvested.................................................................. 103 418
Redeemed.................................................................................. (6,009,727) (19,330,180)
----------- ------------
Net increase (decrease)..................................................................... $ 460,185 $(10,675,679)
=========== ============
Retail Class:
Issued.................................................................................... $ 1,151,543 $ 318,780
Distributions reinvested.................................................................. 2,233 5,301
Redeemed.................................................................................. (39,891) (16,160)
----------- ------------
Net increase................................................................................ $ 1,113,885 $ 307,921
=========== ============
Shares issued and redeemed:
Institutional Class:
Issued.................................................................................... 580,254 882,812
Distributions reinvested.................................................................. 9 44
Redeemed.................................................................................. (540,949) (1,972,616)
----------- ------------
Net increase (decrease)..................................................................... 39,314 (1,089,760)
=========== ============
Retail Class:
Issued.................................................................................... 101,638 32,257
Distributions reinvested.................................................................. 203 555
Redeemed.................................................................................. (3,592) (1,663)
----------- ------------
Net increase................................................................................ 98,249 31,149
=========== ============
</TABLE>
- ---------------
The accompanying notes are an integral part of the financial statements.
<PAGE> 34
CAPITAL GROWTH PORTFOLIO
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
Institutional Class
--------------------------------------------------------
Period from
Six months ended July 19, 1993**
October 31, 1995 Year ended to April 30,
(Unaudited) April 30, 1995 1994
---------------- -------------- ----------------
<S> <C> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period................................... $ 10.20 $ 10.19 $ 10.00
------- ------- -------
Income from investment operations:
Net investment income.................................................. 0.07 0.14 0.06
Net realized and unrealized gain on investments........................ 0.68 0.16 0.21
------- ------- -------
Total from investment operations....................................... 0.75 0.30 0.27
------- ------- -------
Distributions:
Net investment income.................................................. (0.06) (0.11) (0.03)
Net realized gain...................................................... (0.01) (0.18) (0.05)
------- ------- -------
Total distributions.................................................... (0.07) (0.29) (0.08)
------- ------- -------
Net asset value, end of period......................................... $ 10.88 $ 10.20 $ 10.19
======= ======= =======
TOTAL RETURN........................................................... 7.13%+# 3.15%+ 2.66%+#
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (thousands).................................. $ 44,355 $ 41,170 $ 52,233
Ratio of expenses to average daily net assets(1)....................... 0.26%* 0.74% 0.87%*
Ratio of net investment income to average daily net assets............. 1.31%* 1.35% 0.78%*
Portfolio turnover rate................................................ 733%* 182% 41%*
- ---------------
(1) During the period, certain fees were voluntarily waived. The ratio
of expenses to average daily net assets had such waivers not
occurred is as follows............................................. 0.86%* 0.85% 0.87%*
</TABLE>
<TABLE>
<CAPTION>
Retail Class
--------------------------------------------------------
Period from
Six months ended March 9, 1994**
October 31, 1995 Year ended to April 30,
(Unaudited) April 30, 1995 1994
---------------- -------------- ----------------
<S> <C> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period................................... $ 10.18 $ 10.18 $ 10.89
------- ------- -------
Income from investment operations:
Net investment income.................................................. 0.06 0.08 0.00
Net realized and unrealized gain (loss) on investments................. 0.66 0.18 (0.71)
------- ------- -------
Total from investment operations....................................... 0.72 0.26 (0.71)
------- ------- -------
Distributions:
Net investment income.................................................. (0.04) (0.08) 0.00
Net realized gain...................................................... (0.01) (0.18) 0.00
------- ------- -------
Total distributions.................................................... (0.05) (0.26) 0.00
------- ------- -------
Net asset value, end of period......................................... $ 10.85 $ 10.18 $ 10.18
======== ======== ========
TOTAL RETURN........................................................... 6.85%+# 2.74%+ (6.52)%+#
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (thousands).................................. $ 1,496 $ 404 $ 87
Ratio of expenses to average daily net assets(1)....................... 0.75%* 1.23% 1.92%*
Ratio of net investment income to average daily net assets............. 0.82%* 0.86% (0.27)%*
Portfolio turnover rate................................................ 733%* 182% 41%*
- ---------------
* Annualized
** Commencement of operations
+ Total return does not include the one time sales charge for the
Retail Class.
Total return would have been lower had certain expenses not been
reimbursed during the period.
# Total return for periods of less than one year are not
annualized.
(1) During the period, certain fees were voluntarily waived. The
ratio of expenses to average daily net assets had such waivers
not occurred is as follows...................................... 3.77%* 9.73% 30.78%*
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 35
ARK FUNDS: INTERNATIONAL EQUITY PORTFOLIO
PORTFOLIO OF INVESTMENTS / OCTOBER 31, 1995 (UNAUDITED)
(Showing Percentage of Total Value of Investments)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Value
Shares (Note 1)
------- -----------
<S> <C> <C>
COMMON STOCKS - 94.0%
AUSTRALIA - 1.7%
BASIC INDUSTRY - 0.7%
Broken Hill Proprietary Co., Ltd................. 719 $ 9,735
Western Mining Corp. Holdings Ltd................ 1,971 12,638
-----------
TOTAL BASIC INDUSTRY............................. 22,373
-----------
CONSUMER NON-DURABLES - 0.6%
News Corp., Ltd.................................. 3,623 18,264
-----------
FINANCE - 0.4%
National Australia Bank Ltd...................... 1,366 11,691
-----------
TOTAL AUSTRALIA.................................. 52,328
-----------
DENMARK - 1.5%
UTILITIES - 1.5%
Tele Danmark A/S, Class B........................ 860 44,874
-----------
FRANCE - 5.7%
CONSUMER DURABLES - 2.4%
Groupe SEB S.A................................... 273 33,053
PSA Peugeot Citroen S.A.......................... 300 39,084
-----------
TOTAL CONSUMER DURABLES.......................... 72,137
-----------
CONSUMER NON-DURABLES - 1.6%
Accor S.A........................................ 402 47,768
-----------
ENERGY - 1.1%
Elf Aquitaine.................................... 500 34,052
-----------
FINANCE - 0.0%
Cie UAP.......................................... 14 364
-----------
UTILITIES - 0.6%
Cie Generale des Eaux............................ 202 18,777
-----------
TOTAL FRANCE..................................... 173,098
-----------
GERMANY - 4.3%
BASIC INDUSTRY - 1.0%
Bayer AG......................................... 112 29,610
-----------
FINANCE - 0.9%
Deutsche Bank AG................................. 610 27,528
-----------
TECHNOLOGY - 2.4%
Mannesmann AG.................................... 220 72,234
-----------
TOTAL GERMANY.................................... 129,372
-----------
HONG KONG - 2.2%
FINANCE - 2.2%
Cheung Kong Holdings Ltd......................... 2,606 14,696
First Pacific Co., Ltd........................... 18,000 20,721
Hong Kong & Shanghai Bank Holdings PLC........... 1,200 17,462
Swire Pacific Ltd., Class A...................... 1,736 13,024
-----------
TOTAL FINANCE.................................... 65,903
-----------
ITALY - 1.1%
CONSUMER DURABLES - 1.1%
Benetton Group S.p.A............................. 3,200 33,137
-----------
JAPAN - 43.2%
BASIC INDUSTRY - 3.2%
Asahi Chemical Industry Co., Ltd................. 5,000 35,100
Asahi Glass Co................................... 3,000 29,331
Yokohama Rubber Co., Ltd......................... 6,000 31,854
-----------
TOTAL BASIC INDUSTRY............................. 96,285
-----------
<CAPTION>
Value
Shares (Note 1)
------- -----------
<S> <C> <C>
BUSINESS SERVICES - 3.9%
Mitsui & Co...................................... 6,000 $ 47,751
Mitsui Trust & Banking........................... 4,000 31,991
Nagase & Co...................................... 5,000 39,597
-----------
TOTAL BUSINESS SERVICES.......................... 119,339
-----------
CAPITAL GOODS - 2.0%
Mitsubishi Heavy Industries Ltd.................. 8,000 61,713
-----------
CONSUMER DURABLES - 3.4%
Matsushita Electric Industries Ltd............... 3,000 42,530
Mizuno Corp...................................... 3,000 24,140
Toyota Motor Corp................................ 2,000 37,153
-----------
TOTAL CONSUMER DURABLES.......................... 103,823
-----------
CONSUMER NON-DURABLES - 7.0%
Chiyoda Co....................................... 3,000 58,956
Royal Ltd........................................ 1,000 34,220
Shimachu Co., Ltd................................ 2,000 52,796
Tokyo Dome Corp.................................. 1,000 15,155
Toppan Printing Co., Ltd......................... 4,000 52,796
-----------
TOTAL CONSUMER NON-DURABLES...................... 213,923
-----------
ENGINEERING & CONSTRUCTION - 3.2%
Chudenko Corp.................................... 1,000 36,468
Fukada Corp...................................... 2,000 18,576
Sekisui House Co., Ltd........................... 2,000 23,074
Sodick*.......................................... 2,000 18,968
-----------
TOTAL ENGINEERING & CONSTRUCTION................. 97,086
-----------
FINANCE - 6.6%
Akita Bank....................................... 2,000 13,199
Japan Securities Finance Co., Ltd................ 1,000 12,515
Nomura Securities Co............................. 2,000 36,566
Orix Corp........................................ 1,000 35,197
Sakura Bank Ltd.................................. 3,000 29,039
Taiko Bank Ltd................................... 5,000 21,998
Tokio Marine & Fire Insurance Co................. 3,000 30,798
Tokyo Tatemono Co., Ltd.......................... 5,000 20,141
-----------
TOTAL FINANCE.................................... 199,453
-----------
HEALTH CARE - 0.7%
Sankyo Co., Ltd.................................. 1,000 21,998
-----------
TECHNOLOGY - 10.1%
Asahi Diamond Industrial......................... 3,000 38,424
Hitachi Ltd...................................... 3,000 30,798
Hitachi Metals Ltd............................... 3,000 36,957
Nikon Corp....................................... 2,000 28,549
Olympus Optical Co., Ltd......................... 6,000 56,022
Sumitomo Electric Industries..................... 4,000 46,148
Toshiba Corp..................................... 8,000 57,959
Tsudakoma Corp................................... 2,000 11,361
-----------
TOTAL TECHNOLOGY................................. 306,218
-----------
TRANSPORTATION - 1.2%
Nippon Yusen..................................... 7,000 37,436
-----------
UTILITIES - 1.9%
DDI Corp......................................... 4 32,421
Nippon Telephone & Telegraph Corp................ 3 24,609
-----------
TOTAL UTILITIES.................................. 57,030
-----------
TOTAL JAPAN...................................... 1,314,304
-----------
MALAYSIA - 3.2%
BASIC INDUSTRY - 0.5%
Genting Bhd...................................... 2,000 17,241
-----------
CAPITAL GOODS - 0.2%
UMW Holdings Bhd................................. 2,266 5,396
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 36
INTERNATIONAL EQUITY PORTFOLIO
PORTFOLIO OF INVESTMENTS / OCTOBER 31, 1995 (UNAUDITED) - continued
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Value
Shares (Note 1)
------- -----------
<S> <C> <C>
COMMON STOCKS - continued
CONSUMER DURABLES - 0.7%
Renong Bhd....................................... 13,000 $ 19,854
-----------
ENGINEERING & CONSTRUCTION - 0.4%
United Engineers Ltd. (Malaysia)................. 2,000 12,439
-----------
FINANCE - 1.4%
Land & General Holdings Bhd...................... 4,500 10,451
Malayan Banking Bhd.............................. 4,000 32,277
-----------
TOTAL FINANCE.................................... 42,728
-----------
TOTAL MALAYSIA................................... 97,658
-----------
NETHERLANDS - 4.3%
BUSINESS SERVICES - 0.4%
Koninklijke PTT Nederland N.V.................... 297 10,451
-----------
FINANCE - 3.9%
ABN Amro Holdings N.V............................ 1,328 55,825
Aegon N.V........................................ 1,672 63,500
-----------
TOTAL FINANCE.................................... 119,325
-----------
TOTAL NETHERLANDS................................ 129,776
-----------
SINGAPORE - 2.1%
CONSUMER NON-DURABLES - 1.0%
Singapore Press Holdings Ltd..................... 2,000 31,292
-----------
FINANCE - 1.1%
Development Bank of Singapore Ltd................ 1,000 11,469
Keppel Corp., Ltd................................ 2,000 16,425
Malayan Credit Ltd............................... 3,000 5,501
-----------
TOTAL FINANCE.................................... 33,395
-----------
TOTAL SINGAPORE.................................. 64,687
-----------
SPAIN - 2.6%
ENERGY - 0.9%
Repsol S.A....................................... 887 26,509
-----------
FINANCE - 1.7%
Banco de Santander S.A. (Registered)............. 1,214 52,956
-----------
TOTAL SPAIN...................................... 79,465
-----------
SWEDEN - 2.6%
CAPITAL GOODS - 1.3%
Atlas Copco AB, Class A Free..................... 2,702 40,922
-----------
HEALTH CARE - 1.3%
Astra AB, Class A Free........................... 1,090 40,080
-----------
TOTAL SWEDEN..................................... 81,002
-----------
SWITZERLAND - 4.9%
CAPITAL GOODS - 1.7%
Roche Holding AG................................. 5 36,343
Saurer AG........................................ 46 16,617
-----------
TOTAL CAPITAL GOODS.............................. 52,960
-----------
CONSUMER NON-DURABLES - 1.9%
Nestle S.A. (Registered)......................... 55 57,665
-----------
ENERGY - 1.3%
Alusuisse-Lonza Holding AG (Registered).......... 50 38,106
-----------
TOTAL SWITZERLAND................................ 148,731
-----------
THAILAND - 1.1%
BUSINESS SERVICES - 0.0%
Total Access Communication Public Co., Ltd....... 3,500 842
-----------
<CAPTION>
Value
Shares (Note 1)
------- -----------
<S> <C> <C>
FINANCE - 1.1%
Finance One Co., Ltd............................. 3,000 $ 16,812
Land & House Co., Ltd. (Foreign)................. 999 16,121
-----------
TOTAL FINANCE.................................... 32,933
-----------
TOTAL THAILAND................................... 33,775
-----------
UNITED KINGDOM - 12.4%
BASIC INDUSTRY - 0.9%
BOC Group PLC.................................... 961 13,200
Hanson PLC....................................... 5,145 15,756
-----------
TOTAL BASIC INDUSTRY............................. 28,956
-----------
BUSINESS SERVICES - 0.9%
Reuters Holdings PLC............................. 2,995 27,835
-----------
CAPITAL GOODS - 0.6%
BTR PLC.......................................... 3,421 18,168
-----------
CONSUMER NON-DURABLES - 2.7%
Argyll Group PLC................................. 2,253 11,467
Guinness PLC..................................... 2,209 17,702
Marks & Spencer PLC.............................. 3,099 20,769
Sainsbury (J) PLC................................ 2,805 18,799
Unilever PLC..................................... 640 12,432
-----------
TOTAL CONSUMER NON-DURABLES...................... 81,169
-----------
ENERGY - 1.9%
British Petroleum Co. PLC........................ 4,183 30,777
Shell Transport & Trading Co. PLC................ 2,273 26,622
-----------
TOTAL ENERGY..................................... 57,399
-----------
ENGINEERING & CONSTRUCTION - 0.6%
General Electric Co. PLC......................... 3,707 18,398
-----------
FINANCE - 2.3%
Barclays PLC..................................... 1,296 15,220
Lloyds Bank PLC.................................. 1,615 19,885
National Westminster Bank PLC.................... 1,795 17,931
Prudential Corp. PLC............................. 2,843 17,795
-----------
TOTAL FINANCE.................................... 70,831
-----------
HEALTH CARE - 0.9%
SmithKline Beecham PLC, Class A.................. 1,620 16,913
Zeneca Group PLC................................. 614 11,437
-----------
TOTAL HEALTH CARE................................ 28,350
-----------
UTILITIES - 1.6%
Cable & Wireless PLC............................. 3,281 21,470
London Electricity PLC........................... 1,809 25,791
-----------
TOTAL UTILITIES.................................. 47,261
-----------
TOTAL UNITED KINGDOM............................. 378,367
-----------
UNITED STATES - 1.1%
TECHNOLOGY - 1.1%
Indosat ADR...................................... 1,000 33,125
-----------
TOTAL COMMON STOCKS (Cost $2,863,429)............ 2,859,602
-----------
PREFERRED STOCKS - 1.7%
GEA AG (Cost $55,598)............................ 160 52,306
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 37
INTERNATIONAL EQUITY PORTFOLIO
PORTFOLIO OF INVESTMENTS / OCTOBER 31, 1995 (UNAUDITED) - continued
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Annualized
Yield at
Due Time of Principal Value
Date Purchase Amount (Note 1)
- ----------- ---------- -------- ----------
<S> <C> <C>
CASH EQUIVALENTS - 4.3%
UNITED STATES - 4.3%
U.S. TREASURY BILL - 4.3%
11/02/95 4.95% $132,000 $ 131,982
(Cost $131,982) ----------
TOTAL INVESTMENTS - 100%
(Cost $3,051,009)...... $3,043,890
=========
</TABLE>
- ---------------
ADR - American Depositary Receipt
* Non-income producing
<TABLE>
<S> <C>
INCOME TAX INFORMATION:
At October 31, 1995, the net unrealized depreciation based
on cost for income tax purposes of $3,051,009 was as
follows:
Aggregate gross unrealized appreciation for all
investments in which there was an excess of value over
tax cost $ 177,201
Aggregate gross unrealized depreciation for all
investments in which there was an excess of tax cost
over value (184,320)
---------
Net unrealized depreciation $ (7,119)
========
OTHER INFORMATION:
Purchases and sales of securities, other than short-term
securities and U.S. Government and Agency securities,
for the six months ended October 31, 1995 aggregated
$720,397 and $618,207, respectively.
FOREIGN FORWARD CURRENCY CONTRACT INFORMATION:
Under the terms of forward foreign currency contracts open
at October 31, 1995, the Portfolio is obligated to
deliver or is to receive foreign currency in exchange for
U.S. dollars as indicated below:
</TABLE>
<TABLE>
<CAPTION>
In Net
Currency to Exchange Unrealized
Delivery Value Settlement For Value Gain (Loss)
- ------------------ ---------- -------- --------- -------- -----------
<S> <C> <C> <C> <C> <C> <C>
A$ 31,920 $ 24,307 11/1/95 $ 23,863 $ 23,863 $ (444)
$ 31,379 31,379 11/2/95 S $44,350 31,399 20
L 56,875 89,897 11/7/95 $ 89,607 89,607 (290)
Y 69,909,000 683,506 11/30/95 $700,000 700,000 16,494
---------- -------- -----------
$829,089 $844,869 $15,780
========= ======== ==========
</TABLE>
- ---------------
A$ - Australian Dollar
L - British Pounds
Y - Japanese Yen
S$ - Singapore Dollar
The accompanying notes are an integral part of the financial statements.
<PAGE> 38
INTERNATIONAL EQUITY PORTFOLIO
FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
October 31, 1995
<TABLE>
<S> <C> <C>
ASSETS:
Investments, at value (Cost $3,051,009) (Note
1)............................................ $3,043,890
Cash............................................ 573
Receivable from adviser (Note 4)................ 13,709
Receivable for investments sold................. 114,204
Net unrealized gain on foreign forward currency
contracts..................................... 15,780
Dividends receivable............................ 6,872
Foreign withholding tax reclaim................. 2,347
----------
Total assets................................ 3,197,375
LIABILITIES:
Payable for investments purchased............... $32,245
Custodian fees payable.......................... 2,000
Administration and distribution fees payable.... 405
Audit fees payable.............................. 5,220
Other payables and accrued expenses............. 5,020
-------
Total liabilities........................... 44,890
----------
NET ASSETS...................................... $3,152,485
=========
Net Assets consist of:
Paid in capital................................. $3,022,795
Undistributed net investment income............. 4,697
Accumulated undistributed net realized gain
on investments................................ 116,044
Net unrealized appreciation in value of
investments
and foreign currency related transactions..... 8,949
----------
NET ASSETS...................................... $3,152,485
=========
NET ASSET VALUE, offering price and redemption
price per
share ($3,152,485 / 305,749 shares
outstanding).................................. $10.31
=====
</TABLE>
STATEMENT OF OPERATIONS
Six months ended October 31, 1995
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Dividends........................................ $ 37,308
Less: Foreign taxes withheld..................... (4,682)
--------
Total Investment income...................... 32,626
EXPENSES:
Advisory fee (Note 2)............................ $ 12,422
Administration and distribution fees (Note 2).... 2,329
Transfer agent fee............................... 5,381
Registration fee................................. 2,584
Custodian fees and expenses...................... 215
Pricing & bookkeeping fees payable............... 23,017
Miscellaneous.................................... 4,249
--------
Total expenses before waivers................ 50,197
Waivers of expenses (Note 4)..................... (26,131) 24,066
-------- --------
Net investment income............................ 8,560
Net realized gain on:
Investments.................................... 70,822
Foreign currency transactions.................. 45,627
--------
Total net realized gain.......................... 116,449
Change in net unrealized appreciation
(depreciation)................................. (66,339)
--------
Net increase in net assets resulting from
operations..................................... $ 58,670
========
</TABLE>
- ---------------
The accompanying notes are an integral part of the financial statements.
<PAGE> 39
INTERNATIONAL EQUITY PORTFOLIO
FINANCIAL STATEMENTS (UNAUDITED) - continued
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Six months ended Period from
October 31, 1995 December 30, 1994*
(Unaudited) to April 30, 1995
---------------- ------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income................................................................. $ 8,560 $ 8,379
Net realized gain (loss) on investments and foreign currency transactions............. 116,449 (3,941)
Change in unrealized appreciation (depreciation)...................................... (66,339) 75,288
---------- ----------
Net increase in net assets resulting from operations.................................... 58,670 79,726
---------- ----------
DISTRIBUTIONS:
Net investment income................................................................... (8,706) --
---------- ----------
SHARE TRANSACTIONS(1):
Proceeds from sales of shares........................................................... 154,000 2,860,089
Reinvested dividends.................................................................... 8,706 --
---------- ----------
Net increase in net assets resulting from share transactions............................ 162,706 2,860,089
---------- ----------
Total increase in net assets........................................................ 212,670 2,939,815
NET ASSETS:
Beginning of period................................................................... 2,939,815 --
---------- ----------
End of period (including undistributed net investment income of $4,697 and $4,843,
respectively)....................................................................... $3,152,485 $2,939,815
========== ==========
- ---------------------------------------------------------------------------------------------------------------------------------
(1) Shares issued
Issued................................................................................ 14,672 290,197
Distributions reinvested.............................................................. 880 --
---------- ----------
Net increase............................................................................ 15,552 290,197
========== ==========
</TABLE>
- ---------------
* Commencement of operations
The accompanying notes are an integral part of the financial statements.
<PAGE> 40
INTERNATIONAL EQUITY PORTFOLIO
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
Six months ended Period from
October 31, 1995 December 30, 1994**
(Unaudited) to April 30, 1995
---------------- -------------------
<S> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period............................................. $10.13 $ 10.00
------ ------
Income from investment operations:
Net investment income............................................................ 0.03 0.03
Net realized gain on investments................................................. 0.18 0.10
------ ------
Total from investment operations................................................. 0.21 0.13
------ ------
Distributions:
Net investment income............................................................ (0.03) --
------ ------
Net asset value, end of period................................................... $10.31 $ 10.13
====== =======
TOTAL RETURN..................................................................... 1.78%+# 1.30%+#
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (thousands)............................................ $3,152 $ 2,940
Ratio of expenses to average daily net assets(1)................................. 1.55%* 1.55%*
Ratio of net investment income to average daily net assets....................... 0.55%* 0.97%*
Portfolio turnover rate.......................................................... 42%* 2%*
- ---------------
* Annualized
** Commencement of operations
Total return would have been lower had certain fees not been waived during
+ the period.
# Total return for periods of less than one year are not annualized.
During the period, certain fees were voluntarily waived. The ratio of
expenses to average daily net assets had
(1) such waivers not occurred is as follows..................................... 3.23%* 5.35%*
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 41
ARK FUNDS: SPECIAL EQUITY PORTFOLIO
PORTFOLIO OF INVESTMENTS / OCTOBER 31, 1995 (UNAUDITED)
(Showing Percentage of Total Value of Investments)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Value
Shares (Note 1)
------- -----------
<S> <C> <C>
COMMON STOCKS - 98.4%
BASIC INDUSTRY - 1.8%
Sanifill, Inc.*.................................. 4,000 $ 126,000
-----------
BUSINESS SERVICES - 2.5%
Employee Solutions, Inc.*........................ 5,000 76,875
National Data Corp. ............................. 3,500 92,750
-----------
TOTAL BUSINESS SERVICES.......................... 169,625
-----------
CONSUMER DURABLES - 6.9%
Gentex Corp.*.................................... 4,000 89,000
Lo-Jack Corp.*................................... 5,000 77,500
Nu-Kote Holding, Inc., Class A*.................. 4,000 83,000
Top Source Technologies, Inc.*................... 15,000 109,688
Tracor, Inc. .................................... 7,500 120,000
-----------
TOTAL CONSUMER DURABLES.......................... 479,188
-----------
CONSUMER NON-DURABLES - 19.3%
Acclaim Entertainment, Inc.*..................... 3,000 70,875
Applebee's International, Inc. .................. 2,000 56,250
Barnes & Noble Inc.*............................. 2,000 73,000
Borders Group, Inc.*............................. 2,000 34,250
Darden Restaurants, Inc. ........................ 15,000 170,625
De Rigo S.P.A. ADR............................... 5,000 103,125
First Brands Corp. .............................. 3,000 137,250
Jones Apparel Group, Inc.*....................... 3,500 119,875
Just For Feet, Inc. ............................. 2,500 59,062
Movie Gallery, Inc.*............................. 3,000 115,500
Papa John's International, Inc. ................. 500 19,250
Regis Corp. ..................................... 4,000 91,000
Showboat, Inc. .................................. 5,000 120,000
Warnaco Group, Inc. ............................. 4,000 93,000
Williams-Sonoma, Inc.*........................... 4,000 69,500
-----------
TOTAL CONSUMER NON-DURABLES...................... 1,332,562
-----------
ENERGY - 4.3%
Questar Corp. ................................... 3,500 105,438
Reading & Bates Corp.*........................... 8,000 92,000
Seitel, Inc.*.................................... 4,000 103,500
-----------
TOTAL ENERGY..................................... 300,938
-----------
ENGINEERING & CONSTRUCTION - 1.3%
UCAR International, Inc. ........................ 3,100 88,350
-----------
FINANCE - 10.3%
Finova Group, Inc. .............................. 2,500 113,125
Hibernia Corp., Class A.......................... 15,000 148,125
ISB Financial Corp. ............................. 6,000 100,500
MS Financial, Inc.*.............................. 7,500 84,375
NAC Re Corp. .................................... 2,000 70,250
Olympic Financial Ltd.*.......................... 4,000 73,000
Prudential Reinsurance Holdings, Inc. ........... 6,000 122,250
-----------
TOTAL FINANCE.................................... 711,625
-----------
HEALTH CARE - 11.1%
American Oncology Resources, Inc.*............... 2,000 70,000
IDEC Pharmaceuticals Corp. ...................... 10,000 118,750
Interneuron Pharmaceuticals, Inc. ............... 7,500 111,562
Mid Atlantic Medical Services, Inc.*............. 7,000 139,125
Sierra Health Services, Inc.*.................... 4,000 114,500
United Dental Care, Inc. ........................ 3,000 91,500
United Wisconsin Services, Inc. ................. 5,000 124,375
-----------
TOTAL HEALTH CARE................................ 769,812
-----------
<CAPTION>
Value
Shares (Note 1)
------- -----------
<S> <C> <C>
TECHNOLOGY - 39.6%
Checkfree Corp. ................................. 8,000 $ 169,000
Cooper & Chyan Technology, Inc. ................. 500 7,062
Cypress Semiconductor Corp.*..................... 3,000 105,750
Diamond Multimedia Systems, Inc. ................ 3,000 88,500
ESS Technology, Inc. ............................ 7,000 210,000
Harbinger Corp. ................................. 3,500 49,000
Gasonics International Corp.*.................... 3,500 115,500
Infinity Broadcasting Corp., Class A*............ 2,000 65,000
Integrated Measurement Systems, Inc. ............ 2,000 27,000
LeCroy Corp. .................................... 12,000 147,000
Logic Works, Inc. ............................... 5,000 76,250
MDL Information Systems, Inc.*................... 2,000 37,750
MEMC Electronic Materials, Inc. ................. 1,700 54,400
Netscape Communications Corp. ................... 2,000 176,000
Pairgain Technologies, Inc.*..................... 2,500 106,875
Platinum Technology, Inc.*....................... 1,000 18,250
Pure Software, Inc. ............................. 4,000 147,000
Remedy Corp. .................................... 2,000 86,000
Robotic Vision Systems, Inc.*.................... 1,500 34,313
Sanmina Corp. ................................... 934 50,436
Shiva Corp.*..................................... 2,000 120,000
Silicon Valley Group, Inc.*...................... 2,000 64,750
Simware, Inc. ................................... 3,000 28,125
Smith Micro Software, Inc. ...................... 5,000 61,250
StorMedia, Inc. ................................. 2,000 92,000
Symantec Corp.*.................................. 7,000 170,187
TelCom Semiconductor, Inc. ...................... 5,000 39,375
Teltrend, Inc. .................................. 5,500 162,250
UUNET Technologies, Inc. ........................ 3,000 182,250
Vantive Corp. ................................... 3,000 48,000
-----------
TOTAL TECHNOLOGY................................. 2,739,273
-----------
TRANSPORTATION - 1.3%
Atlas Air, Inc.*................................. 6,000 89,250
-----------
TOTAL COMMON STOCKS (Cost $6,346,298)............ 6,806,623
-----------
INVESTMENT COMPANIES - 0.9%
Templeton Global Utilities, Inc. (Cost
$67,225)....................................... 5,000 63,750
-----------
WARRANTS - 0.7%
Wang Labs, expiring 07/01/01* (Cost $59,375)..... 10,000 50,000
-----------
TOTAL INVESTMENTS - 100%
(Cost $6,472,898).............................. $ 6,920,373
=========
</TABLE>
- ---------------
ADR - American Depository Receipt
* Non-income producing
** Commencement of operations.
<TABLE>
<S> <C>
INCOME TAX INFORMATION:
At October 31, 1995, the net unrealized appreciation based
on cost for income tax purposes of $6,472,898 was as
follows:
Aggregate gross unrealized appreciation for all
investments in which there was an excess of value over
tax cost $ 627,459
---------
Aggregate gross unrealized depreciation for all
investments in which there was an excess of tax cost
over value (179,984)
Net unrealized appreciation $ 447,475
========
OTHER INFORMATION:
Purchases and sales of securities, other than short-term
securities and U.S. Government and Agency securities,
for the period from July 13, 1995** to October 31, 1995
aggregated $15,511,872 and $8,943,108, respectively.
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 42
SPECIAL EQUITY PORTFOLIO
FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
October 31, 1995
<TABLE>
<S> <C> <C>
ASSETS:
Investments, at value (Cost $6,472,898) (Note
1)........................................... $6,920,373
Receivable for investments sold................ 1,999,603
Dividends receivable........................... 17,694
----------
Total assets............................... 8,937,670
LIABILITIES:
Payable for investments purchased.............. $891,081
Investment advisory fees payable............... 3,758
Administration and distribution fees payable... 940
Other payables and accrued expenses............ 12,418
--------
Total liabilities.......................... 908,197
----------
NET ASSETS..................................... $8,029,473
=========
Net Assets consist of:
Paid in capital................................ $7,667,050
Undistributed net investment income............ 10,814
Accumulated net realized loss on investments... (95,866)
Net unrealized appreciation in value of
investments.................................. 447,475
----------
NET ASSETS..................................... $8,029,473
=========
NET ASSET VALUE, offering price and redemption
price per share ($8,029,473 / 721,640 shares
outstanding)................................. $11.13
=====
</TABLE>
STATEMENT OF OPERATIONS
Period from July 13, 1995* to October 31, 1995
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Dividends......................................... $ 33,385
EXPENSES:
Advisory fee (Note 2)............................. $10,858
Administration and distribution fees (Note 2)..... 2,714
Registration fee.................................. 1,525
Custodian fees and expenses....................... 4,082
Audit............................................. 1,980
Trustees' Compensation............................ 27
Miscellaneous..................................... 1,385
-------
Total expenses................................ 22,571
Net investment income............................. 10,814
Net realized loss on investments.................. (95,866)
Change in net unrealized appreciation............. 447,475
--------
Net increase in net assets resulting from
operations...................................... $362,423
========
</TABLE>
- ---------------
* Commencement of operations
The accompanying notes are an integral part of the financial statements.
<PAGE> 43
SPECIAL EQUITY PORTFOLIO
FINANCIAL STATEMENTS (UNAUDITED) - continued
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Period from
July 13, 1995*
to October 31, 1995
-------------------
<S> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income................................................................................... $ 10,814
Net realized loss on investments........................................................................ (95,866)
Change in unrealized appreciation....................................................................... 447,475
----------
Net increase in net assets resulting from operations...................................................... 362,423
----------
SHARE TRANSACTIONS(1):
Proceeds from sales of shares............................................................................. 7,758,671
Cost of shares redeemed................................................................................... (91,621)
----------
Net increase in net assets resulting from share transactions.............................................. 7,667,050
----------
Total increase in net assets.......................................................................... 8,029,473
NET ASSETS:
Beginning of period..................................................................................... --
----------
End of period (including undistributed net investment income of $10,814) $ 8,029,473
==========
- ---------------------------------------------------------------------------------------------------------------------------------
(1) Shares issued and redeemed
Issued.................................................................................................. 729,882
Redeemed................................................................................................ (8,242)
----------
Net increase.............................................................................................. 721,640
==========
</TABLE>
- ---------------
* Commencement of operations
The accompanying notes are an integral part of the financial statements.
<PAGE> 44
SPECIAL EQUITY PORTFOLIO
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
Period from
July 13, 1995**
to October 31, 1995
(Unaudited)
-------------------
<S> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period........................................................................ $ 10.00
------
Income from investment operations:
Net investment income....................................................................................... 0.01
Net realized and unrealized gain on investments............................................................. 1.12
------
Total from investment operations............................................................................ 1.13
------
Net asset value, end of period.............................................................................. $ 11.13
======
TOTAL RETURN................................................................................................ 11.30%#
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (thousands)....................................................................... $ 8,029
Ratio of expenses to average daily net assets............................................................... 1.25%*
Ratio of net investment income to average daily net assets.................................................. 0.60%*
Portfolio turnover rate..................................................................................... 737%*
</TABLE>
- ---------------
* Annualized
** Commencement of operations
# Total return for period of less than one year is not annualized.
The accompanying notes are an integral part of the financial statements.
<PAGE> 45
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING AND OPERATING POLICIES
The ARK Funds (the "Fund") is registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as an open-end management investment company
organized as a Massachusetts business trust pursuant to a Declaration of Trust
dated October 22, 1992 and amended and restated on March 19, 1993.
The Fund consists of nine diversified portfolios: U.S. Treasury Money Market
Portfolio, U.S. Government Money Market Portfolio, Money Market Portfolio,
Tax-Free Money Market Portfolio, Income Portfolio, Growth and Income Portfolio,
Capital Growth Portfolio, International Equity Portfolio and Special Equity
Portfolio (individually a "Portfolio" and collectively the "Portfolios") and may
issue an unlimited number of shares of each of its Portfolios. The Fund's
financial statements are prepared in accordance with generally accepted
accounting principles.
Each investment portfolio (with the exception of International Equity Portfolio)
offers both Institutional and Retail Class shares. In addition, each Money
Market Portfolio offers Institutional II Class shares. The International Equity
Portfolio offers only Institutional Class shares. Institutional Class shares
were originally offered with the commencement of each Portfolio's operations.
Retail Class shares commenced in April 1994 for Income Portfolio and in March
1994 for Tax-Free Money Market Portfolio, Money Market Portfolio, Growth and
Income Portfolio and Capital Growth Portfolio. Retail Class shares have not yet
been issued for U.S. Treasury Money Market Portfolio, U.S. Government Money
Market Portfolio and Special Equity Portfolio. Institutional II Class shares
commenced in July 1995 for U.S. Treasury Money Market Portfolio, U.S. Government
Money Market Portfolio, Money Market Portfolio and Tax-Free Money Market
Portfolio. Each Class of shares has equal rights as to earnings, assets and
voting privileges except that each Class bears different distribution,
shareholder service and transfer agent expenses. Each Class of shares has
exclusive voting rights with respect to matters that affect just that Class.
Income, expenses (other than expenses incurred under each Class' Distribution
and Shareholder Services Plan) and realized and unrealized gains or losses on
investments are allocated to each Class of shares based upon their relative net
assets.
The following is a summary of significant accounting policies for each
Portfolio:
Valuation of Securities. The securities of U.S. Treasury Money Market Portfolio,
U.S. Government Money Market Portfolio, Money Market Portfolio and Tax-Free
Money Market Portfolio are valued on the basis of amortized cost as permitted
under Rule 2a-7 of the 1940 Act and certain conditions therein. Under this
method, securities are valued initially at cost and thereafter assume a constant
amortization to maturity of any discount or premium.
With respect to Income Portfolio, Growth and Income Portfolio, Capital Growth
Portfolio, International Equity Portfolio, and Special Equity Portfolio,
securities that are traded on an exchange or on the over-the-counter market are
valued based upon the last sale price, or if no sale has occurred, at the
closing bid price. Securities for which market quotations are not readily
available are valued at their fair value as determined in good faith by a
committee acting at the direction of the Fund's Board of Trustees. Short-term
debt instruments with remaining maturities of 60 days or less at the time of
purchase are valued at amortized cost, if it approximates current market value.
Securities that are traded on a foreign exchange are valued at their closing
price and translated into U.S. dollars using current exchange rates.
Foreign Currency Translation. The accounting records of each of the Portfolios
are maintained in U.S. dollars. Investment securities and other assets and
liabilities denominated in a foreign currency are translated into U.S. dollars
at the prevailing rates of exchange at period end. Purchases and sales of
securities, income receipts and expense payments are translated into U.S.
dollars at the prevailing exchange rate on the respective dates of the
transactions.
Forward Foreign Currency Contracts. The ARK Non-Money Market Portfolios may
enter into forward foreign currency contracts to protect securities and related
receivables and payables against changes in future exchange rates. Risks may
arise upon entering into these contracts from the potential inability of
counterparties to meet the terms of their contracts and is generally limited to
the amount of unrealized gain on the contracts, if any, at the date of default.
Risk may also arise from unanticipated movements in the value of a foreign
currency relative to the U.S. dollar. Contracts are marked-to-market daily and
the change in market value is recorded as unrealized appreciation or
depreciation. Realized gains or losses arising from such transactions are
included in the realized gains or losses from foreign currency transactions.
Repurchase Agreements. Each Portfolio, except U.S. Treasury Money Market
Portfolio, and Tax-Free Money Market Portfolio may invest in repurchase
agreements. The repurchase price of the securities will generally equal the
amount paid by each Portfolio plus a negotiated interest amount. The seller
under the repurchase agreement will be required to provide securities
(collateral) to each Portfolio whose value is at least equal to the amount of
the agreed upon resale price. If the seller defaults, each Portfolio may suffer
a loss to the extent that the proceeds from the sale of the underlying
securities were less than the repurchase price. Repurchase agreements entered
into by each Portfolio will be limited to transactions with parties that the
investment adviser has determined are creditworthy.
Organization Costs. Costs incurred by the Fund in connection with its initial
share registration were deferred and are being amortized on a straight-line
basis over five years.
<PAGE> 46
NOTES TO FINANCIAL STATEMENTS - continued
- --------------------------------------------------------------------------------
Income Taxes. As a qualified regulated investment company under Subchapter M of
the Internal Revenue Code, each Portfolio is not subject to income taxes to the
extent that it distributes all of its taxable income for its fiscal year.
Accordingly, no provision for federal income taxes is required in the financial
statements.
At April 30, 1995, Tax-Free Money Market Portfolio and Income Portfolio had
approximately $3,500 and $230,000, respectively, in capital loss carryforwards
for Federal income tax purposes available to offset future gains, which will
expire on April 30, 2002.
Investment Income. Interest income is accrued as earned. Interest income
consists of interest accrued and discount earned (including original issue and
market discount), less amortization of premium. Dividend income is recorded on
the ex-dividend date.
Distributions to Shareholders. Dividends from net investment income are declared
daily and paid monthly for U.S. Treasury Money Market Portfolio, U.S. Government
Money Market Portfolio, Money Market Portfolio and Tax-Free Money Market
Portfolio. Income Portfolio declares and pays dividends monthly, Growth and
Income Portfolio declares and pays dividends quarterly and Capital Growth
Portfolio, International Equity Portfolio and Special Equity Portfolio declare
and pay dividends annually from net investment income. Distributions from net
capital gains, if any, are declared and paid annually by each Portfolio.
Dividends and distributions are determined in accordance with income tax
regulations which may differ from generally accepted accounting principles.
These differences are primarily due to deferral of losses on wash sales and
post-October losses and differing treatments of foreign currency transactions
under the income tax regulations.
Other. Investment security transactions are accounted for on trade date.
Realized gains and losses from securities transactions are determined using the
identified cost basis for both financial reporting and income tax purposes.
2. INVESTMENT ADVISORY AND ADMINISTRATIVE FEES
First National Bank of Maryland ("First Maryland") is the Investment Adviser to
the Fund, with the exception of the International Equity Portfolio, which is
advised by AIB Investment Managers Limited ("AIB I.M."), an affiliate of First
Maryland. Pursuant to an Investment Advisory Contract on behalf of each
Portfolio, First Maryland and AIB I.M. (in the case of the International Equity
Portfolio), are paid for their advisory services at the annual rates shown in
the table below based on the average net assets of each Portfolio.
<TABLE>
<CAPTION>
Portfolio Annual Rate
----------------------------------------------------------------------------------------------------------- -----------
<S> <C>
U.S. Treasury Money Market Portfolio....................................................................... .25%
U.S. Government Money Market Portfolio..................................................................... .25%
Money Market Portfolio..................................................................................... .25%
Tax-Free Money Market Portfolio............................................................................ .25%
Income Portfolio........................................................................................... .50%
Growth and Income Portfolio................................................................................ .55%
Capital Growth Portfolio................................................................................... .60%
International Equity Portfolio............................................................................. .80%
Special Equity Portfolio................................................................................... .60%
</TABLE>
Effective November 1, 1995, SEI Financial Management Corporation ("SFM") serves
as administrator and transfer agent to each Portfolio under an Administration
Agreement. SFM is entitled to receive an annual fee of .13% of each Portfolio's
average net assets, paid monthly, for services performed under the
Administration Agreement. SFM has voluntarily agreed to waive a portion of its
fee on certain Portfolios of the Fund in order to limit total operating expenses
of such Portfolios. The waiver is voluntary and may be discontinued at any time.
Effective November 1, 1995, SEI Financial Services Company ("SFS") acts as
distributor for the Portfolios pursuant to a General Distribution Agreement on
behalf of each Portfolio. Formerly, the administrator and distributor was
Fidelity Distributors Corporation ("Fidelity").
3. DISTRIBUTION PLAN AND SHAREHOLDER SERVICES PLAN
The Board has adopted a Distribution Plan on behalf of the Retail Class of each
Portfolio and the Institutional II Class of each Money Market Portfolio pursuant
to Rule 12b-1 under the 1940 Act ("Distribution Plan"). Under the Distribution
Plan, SFS is entitled to a fee of .75% of average net assets of the Portfolio.
However, the Trustees have authorized payment of a fee to SFS of .25% of average
net assets of the Retail Class of each Money Market Portfolio; .30% of average
net assets of the Retail Class of Income Portfolio and .40% of average net
assets of the Retail Class of each of Growth and Income Portfolio, Capital
Growth Portfolio and Special Equity Portfolio and .10% of the average net assets
of the Institutional II Class of each Money Market Portfolio.
Under a Shareholder Services Plan in effect with respect to the Retail Class,
each Portfolio pays shareholder servicing fees to investment professionals at an
annual rate of .15% of average net assets for providing ongoing shareholder
support services to their customers with accounts in such Class.
<PAGE> 47
NOTES TO FINANCIAL STATEMENTS - continued
- --------------------------------------------------------------------------------
4. WAIVER OF FEES
First Maryland voluntarily agreed to waive a portion of its advisory fees for
U.S. Treasury Money Market Portfolio, U.S. Government Money Market Portfolio,
Money Market Portfolio, and Tax-Free Money Market Portfolio and First Maryland
voluntarily agree to waive all of its advisory fees for Capital Growth
Portfolio. Additionally, AIB I.M. voluntarily agreed to temporarily waive a
portion of its advisory fees and reimburse expenses to the extent necessary for
International Equity Portfolio to maintain an annual expense ratio of not more
than 1.55%. For the six months ended October 31, 1995, First Maryland waived
fees totaling $99,479 for U.S. Treasury Money Market Portfolio, $338,943 for
U.S. Government Money Market Portfolio, $249,649 for Money Market Portfolio, and
$70,224 for Tax-Free Money Market Portfolio and $143,435 for Capital Growth
Portfolio. For the six months ended October 31, 1995, AIB I.M. waived advisory
fees of $12,422 and reimbursed expenses of $13,709 to maintain an annual expense
ratio of not more than 1.55% for International Equity Portfolio.
In addition, Fidelity voluntarily agreed to waive a portion of its
administration fees for U.S. Treasury Money Market Portfolio, U.S. Government
Money Market Portfolio, Money Market Portfolio and Tax-Free Money Market
Portfolio. For the period ended October 31, 1995, Fidelity waived fees totaling
$44,791 for U.S. Treasury Money Market Portfolio, $232,055 for U.S. Government
Money Market Portfolio, $150,259 for Money Market Portfolio, and $44,322 for
Tax-Free Money Market Portfolio. These expense limitations are temporary and may
be terminated or revised at any time.
Retail Class distribution fees were waived for all Portfolios, except for the
Retail Class of Money Market Portfolio. Retail Class shareholder service fees
were waived for Income Portfolio, Growth and Income Portfolio and Capital Growth
Portfolio. For Money Market Portfolio and Tax-Free Money Market Portfolio .09%
of .15% shareholder service fee was waived.
For the six months ended October 31, 1995, Retail Class distribution and
shareholder servicing fees waived totaled $24,853 for the Money Market
Portfolio, $9,685 for the Tax-Free Money Market Portfolio, $1,764 for the Income
Portfolio, $1,985 for the Growth and Income Portfolio and $2,221 for the Capital
Growth Portfolio.
Fidelity and Chase Global Funds Services Company ("CGFSC"), formerly Mutual
Funds Service Company ("MFSC"), the transfer and shareholder servicing agent
through October 31, 1995 voluntarily agreed to waive and reimburse certain
expenses for the Retail Class so that the difference in total expenses
(excluding amounts charged under the Distribution Plans and Shareholder
Servicing Plans) between the Retail Class and the Institutional Class of each
Portfolio does not exceed .50% (except for the Retail Class of Tax-Free Money
Market Portfolio, for which all transfer agency and shareholder servicing fees
were waived). For the six months ended October 31, 1995, Fidelity reimbursed
fees of $3,311 for Tax-Free Money Market Portfolio, $135 for Income Portfolio,
$290 for Growth and Income Portfolio and $36 for Capital Growth Portfolio. For
the six months ended October 31, 1995, CGFSC waived fees totaling $8,762 for
Tax-Free Money Market Portfolio, $8,000 for Income Portfolio and $7,500 each for
Growth and Income Portfolio and for Capital Growth Portfolio.
Fidelity has voluntarily agreed to reimburse all class level expenses for the
Institutional II Class shares. For the period ended October 31, 1995, Fidelity
reimbursed fees of $392 for U.S. Treasury Money Market Portfolio, $392 for U.S.
Government Money Market Portfolio, $392 for the Money Market Portfolio and $392
for the Tax-Free Money Market Portfolio.
5. OTHER MATTERS
Certain sales of Retail Class shares of Income Portfolio, Growth and Income
Portfolio and Capital Growth Portfolio are subject to a maximum sales charge of
4.50%, 4.75% and 4.75%, respectively, of the offering price. Effective March 1,
1994, sales loads have been waived for all purchases of the Retail Class. This
sales load waiver is in effect through the end of 1995.
Effective October 9, 1995, First Maryland serves as the custodian of each
portfolio's assets (except for International Equity Portfolio). For the period
September 1, 1995 through October 6, 1995, Chase Manhattan Bank, N.A., through a
merger, succeeded the United States Trust Company of New York as the Fund's
custodian.
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This report and the financial statements contained herein are submitted for the
general information of the shareholders of the Fund. The report is not
authorized for distribution to prospective investors in the Fund unless preceded
or accompanied by an effective prospectus. Shares of the ARK Funds are not
obligations of or guaranteed by The First National Bank of Maryland or any bank,
nor are they insured by the FDIC, the Federal Reserve Board, or any other
agency. Retail Class shares are offered through First Maryland Brokerage, Inc.
and Institutional Class and Institutional II Class shares are offered through
First National Bank of Maryland. Fidelity Distributors Corporation, which
distributes the ARK Funds, is not a bank and is not affiliated with The First
National Bank of Maryland. Investing in mutual funds involves risks, including
possible loss of principal amount invested. An investment in a money market
Portfolio is neither insured nor guaranteed by the U.S. government. There can be
no assurance that a money market Portfolio will maintain a stable $1.00 share
price.
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