<PAGE>
STAGECOACH FUNDS-Registered
Trademark-
Annual Report
MONEY MARKET
Fund
Class S
March 31, 1999
<PAGE>
Money Market Fund TABLE OF CONTENTS
- ------------------------------------------------------------------------
LETTER TO SHAREHOLDERS...........................................1
INVESTMENT ADVISOR COMMENTARY AND
PERFORMANCE AT A GLANCE
Money Market Fund............................................3
PORTFOLIO OF INVESTMENTS
Money Market Fund............................................5
STAGECOACH FUNDS
Statement of Assets and Liabilities.........................13
Statement of Operations.....................................14
Statements of Changes in Net Assets.........................15
Financial Highlights........................................16
Notes to Financial Statements...............................18
INDEPENDENT AUDITORS' REPORT....................................24
LIST OF ABBREVIATIONS...........................................26
NOT FDIC INSURED - NO BANK GUARANTEE - MAY LOSE VALUE
i
<PAGE>
THIS PAGE IS INTENTIONALLY LEFT BLANK --
ii
<PAGE>
LETTER TO SHAREHOLDERS Money Market Funds
- ------------------------------------------------------------------------
TO OUR SHAREHOLDERS
Thank you for investing in the Stagecoach Funds.
We're pleased to provide you with this annual report for the period ended
March 31, 1999. The report provides information about your investment over the
12-month period, including economic and market trends, a performance summary, a
portfolio review and a strategic outlook.
The Stagecoach Funds experienced another year of significant growth, with net
assets increasing from $25 billion to $29 billion during the 12-month period
ended March 31, 1999. We believe our success can be partly attributed to the
confidence and support of our shareholders generated by the continued positive
performance of many of the Funds. Of course, we'll do our best to provide
prudent management to maintain and earn that confidence.
The 12-month period that ended March 31, 1999 was marked by significant
volatility. Stocks marched steadily upward early in the period, but later
surrendered some of those gains during a sell-off in the stock market last
summer. Last summer and fall, global financial turmoil disrupted the U.S.
financial markets, but the economy still benefited from overseas flight to
capital and aggressive monetary easing by the Federal Reserve Board that drove
interest rates down to historic lows. By the end of the year, the stock market
had set new highs as broad stock indexes were propelled higher by a series of
upbeat earnings reports, and the economy's two-tiered performance produced solid
economic growth. Overall, bond yields are significantly lower than they were a
year ago, and fundamentals still point toward healthy growth during the balance
of 1999. The combination of subdued inflation, moderating economic growth and
strong foreign demand should set the stage for lower interest rates.
During the 12-month period ended March 31, 1999, stocks, as measured by the
S&P 500 Index,(1) returned 18.49%. The U.S. Government bond market increased
1
<PAGE>
Money Market Funds LETTER TO SHAREHOLDERS
- ------------------------------------------------------------------------
7.01% as measured by the Lehman Brothers Long Government Bond Index(2) during
the period. Most shorter-dated money market yields dropped late in the period,
while yields on longer-dated papers rose.
According to the Investment Company Institute, an estimated 44 million U.S.
households, or 77.3 million individual investors, owned mutual funds in 1998.
Many of these investors have benefited from unprecedented growth in the market.
While the latest signs of economic strength are positive, investors should
manage their expectations. The challenges of investing in today's markets make
mutual funds one of the most popular investment vehicles. We recommend that you
continually review your investment portfolio with your financial consultant to
determine an appropriate mix of investments to meet your ongoing needs.
Over the years, the Stagecoach Funds have built a reputation for innovation,
leadership and commitment to investors. We understand you have a variety of
investment options and we appreciate your confidence in selecting us to help you
meet your financial goals. Thank you again for your continued investment with
the Stagecoach Funds.
Sincerely,
/s/ Michael J. Hogan
Michael J. Hogan
Senior Vice President
Wells Fargo Bank,
Mutual Fund Group
/s/ R. Greg Feltus
R. Greg Feltus
Chairman and President of
Stagecoach Funds
1 The "S&P 500 Index" is a trademark of the Standard and Poor's Corporation. The
S&P 500 Index is an unmanaged index of 500 widely held common stocks
representing, among others, industrial, financial, utility and transportation
companies listed or traded on national exchanges or over-the-counter markets.
2 The Lehman Brothers Long Government Bond Index is an unmanaged index composed
of U.S. Treasury bonds with 20-year or longer maturities.
2
<PAGE>
INVESTMENT ADVISOR COMMENTARY Money Market Fund
- ------------------------------------------------------------------------
MONEY MARKET FUND - CLASS S
The Stagecoach Money Market Fund (the "Fund") seeks to provide investors with
a high level of income, while preserving capital and liquidity, by investing in
high-quality, short-term instruments.
The Fund is managed by Michael Neitzke of Wells Capital Management
Incorporated. Mr. Neitzke joined Wells Fargo Bank in 1996 from First Interstate
Capital Management. He has more than a decade of experience in managing taxable
money market mutual funds at First Interstate Bank and Union Capital Advisors.
He holds a B.A. in Finance from California State University, Los Angeles.
PERFORMANCE SUMMARY
For the 12-month period ending March 31, 1999, the Stagecoach Money Market
Fund's cumulative total return was 4.10%. The seven-day current yield for the
Fund as of March 31, 1999, was 3.60%.
Keep in mind that past performance is no guarantee of future results.
PORTFOLIO REVIEW
Throughout the period, there were several events that affected the financial
markets. Perhaps the most significant was the series of interest rate cuts by
the Federal Reserve Board (the Fed) late in 1998. These cuts were a result of
serious credit/liquidity problems overseas and problems with several large U.S.
hedge funds. It was clear the Fed was committed to maintaining liquidity in the
markets by lowering interest rates. By adding later-dated securities to our
portfolios, we were able to maintain competitive yields in the low interest rate
environment.
The Fund always maintains a core position in repurchase agreements and other
short-dated securities when they are trading at the upper end of their expected
range.
STRATEGIC OUTLOOK
With international and domestic markets relatively stable and inflation under
control, interest rates are
3
<PAGE>
Money Market Fund INVESTMENT ADVISOR COMMENTARY
- ------------------------------------------------------------------------
expected to remain in a fairly narrow trading range. However, as proven in late
1998, the Fed stands ready to provide necessary liquidity by further lowering
interest rates if global markets continue to experience credit/ liquidity
problems.
The Fund is well positioned given current international economic conditions
and low interest rates. We believe interest rates may remain unchanged at least
until year-end, and we will maintain the Fund's longer than average maturity
structure. We believe it's prudent to focus more on credit quality, stability,
capital preservation and liquidity, rather than purely on yield.
Figures quoted represent past performance, which is no guarantee of future
results. The Fund is neither insured nor guaranteed by the U.S. Government.
The Fund's manager has voluntarily waived all or a portion of its management
fees or assumed responsibility for other expenses, which reduces operating
expenses and increases total return to shareholders. Without these reductions,
the Fund's returns would have been lower. There is no guarantee such reductions
will continue.
An investment in the Fund is not insured or guaranteed by the Federal Deposit
Insurance Corporation or any other government agency. Although the Fund seeks to
preserve the value of your investment at $1.00 per share, it is possible to lose
money by investing in the Fund.
4
<PAGE>
PORTFOLIO OF INVESTMENTS - MARCH 31, 1999 Money Market Fund
- ------------------------------------------------------------------------
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL SECURITY NAME RATE DATE VALUE
<C> <S> <C> <C> <C> <C>
VARIABLE AND FLOATING RATE BONDS - 12.11%
$150,000,000 Abbey National Treasury Service 4.79 % 07/26/99 149,959,700
60,000,000 Abbey National Treasury Service 4.80 07/15/99 59,989,049
65,000,000 Abbey National Treasury Service 4.85 08/17/99 64,981,077
50,000,000 American Express 4.86 09/10/99 50,000,000
25,000,000 American Express 4.88 04/26/99 25,000,000
60,000,000 Bank of America Corporation 4.82 06/25/99 59,993,330
100,000,000 Bank of America Corporation 4.92 03/16/00 99,981,161
34,000,000 Commercial Bank 4.82 07/13/99 33,994,327
55,000,000 First Union National Bank 4.87 09/28/99 55,000,000
125,000,000 Key Bank 4.83 10/04/99 124,975,135
80,000,000 Key Bank 4.88 10/13/99 79,982,521
150,000,000 Key Bank 4.88 10/14/99 149,992,130
75,000,000 Pepsico Incorporated 4.81 08/19/99 74,966,118
75,000,000 Sigma Finance 5.13 08/23/99 75,000,000
65,000,000 Sigma Finance 5.20 08/26/99 65,000,000
78,000,000 Wachovia Bank 4.79 05/14/99 77,993,660
--------------
TOTAL VARIABLE AND FLOATING RATE BONDS $1,246,808,208
(Cost $1,246,808,208)
COMMERCIAL PAPER - 45.29%
$100,000,000 Abbey National Corporation of North America 4.83 %# 05/07/99 $ 99,517,000
51,000,000 Asset Securitization Corporation++ 4.87 # 04/05/99 50,972,403
39,160,000 Asset Securitization Corporation++ 4.95 # 04/16/99 39,079,233
103,000,000 Asset Securitization Corporation++ 5.00 # 04/15/99 102,799,722
40,000,000 Associates Corporation of North America 4.80 # 05/17/99 39,754,667
100,000,000 Associates First Capital Corporation 4.81 # 05/07/99 99,519,000
75,000,000 Associates First Capital Corporation 4.83 # 05/10/99 74,607,563
20,000,000 Atlantis One Funding Corporation 4.78 # 05/13/99 19,888,467
64,056,000 Atlantis One Funding Corporation 4.80 # 05/10/99 63,722,909
94,578,000 Atlantis One Funding Corporation 4.81 # 04/27/99 94,245,459
20,000,000 Atlantis One Funding Corporation 4.82 # 05/12/99 19,890,211
34,054,000 Atlantis One Funding Corporation 4.83 # 05/17/99 33,843,830
14,614,000 Atlantis One Funding Corporation 4.83 # 06/15/99 14,466,947
</TABLE>
5
<PAGE>
Money Market Fund PORTFOLIO OF INVESTMENTS - MARCH 31, 1999
- ------------------------------------------------------------------------
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL SECURITY NAME RATE DATE VALUE
<C> <S> <C> <C> <C> <C>
COMMERCIAL PAPER (CONTINUED)
$34,585,000 Atlantis One Funding Corporation 4.85 %# 06/23/99 $ 34,198,272
50,000,000 Atlantis One Funding Corporation 4.86 # 06/16/99 49,487,000
65,387,000 Atlantis One Funding Corporation 4.86 # 07/09/99 64,513,103
17,774,000 Atlantis One Funding Corporation 5.05 # 04/23/99 17,719,147
85,000,000 Bank of America Corporation 4.82 # 08/16/99 83,440,864
25,000,000 Bayerische Hypoverins Bank 5.10 # 04/01/99 25,000,000
34,000,000 CC USA Incorporated++ 4.86 # 05/17/99 33,788,860
30,000,000 Commercial Credit Corporation 4.86 # 04/23/99 29,910,900
75,000,000 Corporate Asset Funding Company Incorporated++ 4.82 # 05/24/99 74,467,792
75,000,000 Corporate Asset Funding Company Incorporated++ 4.83 # 04/16/99 74,849,063
50,000,000 Corporate Asset Funding Company Incorporated++ 4.83 # 04/22/99 49,859,125
75,000,000 Corporate Asset Funding Company Incorporated++ 4.85 # 06/04/99 74,353,333
50,000,000 Corporate Asset Funding Company Incorporated++ 4.86 # 05/10/99 49,736,750
75,000,000 Corporate Receivables Corporation++ 4.81 # 04/23/99 74,779,542
75,000,000 Corporate Receivables Corporation++ 4.82 # 04/16/99 74,849,375
50,000,000 Corporate Receivables Corporation++ 4.83 # 05/03/99 49,785,333
52,271,000 Corporate Receivables Corporation++ 4.85 # 05/26/99 51,883,686
60,000,000 Corporate Receivables Corporation++ 4.86 # 05/14/99 59,651,700
39,000,000 Dorada Finance Incorporated++ 4.85 # 06/15/99 38,605,938
13,744,000 Dorada Finance Incorporated++ 4.90 # 05/17/99 13,657,947
10,000,000 Dorada Finance Incorporated++ 4.90 # 05/19/99 9,934,667
15,238,000 Enterprise Funding Corporation++ 4.86 # 04/23/99 15,192,743
19,500,000 Eureka Securitization Incorporated++ 4.85 # 05/20/99 19,371,273
25,000,000 Eureka Securitization Incorporated++ 4.87 # 04/16/99 24,949,271
</TABLE>
6
<PAGE>
PORTFOLIO OF INVESTMENTS - MARCH 31, 1999 Money Market Fund
- ------------------------------------------------------------------------
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL SECURITY NAME RATE DATE VALUE
<C> <S> <C> <C> <C> <C>
COMMERCIAL PAPER (CONTINUED)
$50,000,000 Falcon Asset Securitization++ 4.85 %# 06/15/99 $ 49,494,792
100,775,000 Falcon Asset Securitization++ 4.89 # 04/06/99 100,706,557
78,634,000 Fleet Funding Corporation++ 4.85 # 05/07/99 78,252,625
150,000,000 Ford Motor Credit Company 4.80 # 04/27/99 149,480,000
75,000,000 Ford Motor Credit Company 4.81 # 05/14/99 74,569,104
100,000,000 Ford Motor Credit Company 4.83 # 06/15/99 98,993,750
150,000,000 Ford Motor Credit Company 4.84 # 04/09/99 149,838,667
20,000,000 General Electric Capital Services Incorporated 4.67 # 04/20/99 19,950,706
50,000,000 General Electric Capital Services Incorporated 4.78 # 07/14/99 49,309,556
120,000,000 General Electric Capital Services Incorporated 4.81 # 07/01/99 118,540,967
75,000,000 General Electric Capital Services Incorporated 4.85 # 06/08/99 74,312,917
30,000,000 General Electric Capital Services Incorporated 4.88 # 11/30/99 29,011,800
75,000,000 General Electric Capital Services Incorporated 4.90 # 06/28/99 74,101,667
70,000,000 General Electric Capital Services Incorporated 4.79 # 04/29/99 69,739,211
39,000,000 General Electric Financial Assurance
Corporation 4.80 # 08/09/99 38,324,000
70,000,000 Goldman Sachs Group LP 4.84 # 07/07/99 69,087,122
150,000,000 Goldman Sachs Group LP 4.85 # 07/09/99 147,999,375
50,000,000 Goldman Sachs Group LP 4.97 # 04/01/99 50,000,000
70,532,000 Greenwich Funding Corporation++ 4.90 # 04/01/99 70,532,000
56,243,000 International Securitization Corporation++ 4.88 # 04/26/99 56,052,399
50,000,000 Johnson & Johnson++ 4.75 # 04/05/99 49,973,611
70,000,000 Johnson & Johnson++ 4.84 # 06/28/99 69,171,822
75,000,000 Morgan Stanley Dean Witter & Company 4.85 # 05/26/99 74,444,271
50,000,000 National City Credit Corporation 4.82 # 05/04/99 49,779,083
49,000,000 National City Credit Corporation 4.85 # 04/13/99 48,920,783
</TABLE>
7
<PAGE>
Money Market Fund PORTFOLIO OF INVESTMENTS - MARCH 31, 1999
- ------------------------------------------------------------------------
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL SECURITY NAME RATE DATE VALUE
<C> <S> <C> <C> <C> <C>
COMMERCIAL PAPER (CONTINUED)
$47,139,000 Park Avenue Receivables Corporation++ 4.89 %# 04/06/99 $ 47,106,985
102,106,000 Receivables Capital Corporation 4.84 # 04/08/99 102,009,907
48,000,000 Rio Tinto America Incorporated 4.84 # 06/07/99 47,567,627
25,000,000 Riverwoods Funding 4.81 # 04/28/99 24,909,813
25,000,000 Sheffield Receivables Corporation++ 4.83 # 04/16/99 24,949,688
49,000,000 Sheffield Receivables Corporation++ 4.84 # 04/14/99 48,914,359
185,000,000 Sheffield Receivables Corporation++ 4.87 # 04/13/99 184,699,683
6,900,000 Sheffield Receivables Corporation++ 4.88 # 05/20/99 6,854,169
45,000,000 Sheffield Receivables Corporation++ 4.90 # 04/05/99 44,975,500
15,000,000 Sheffield Receivables Corporation++ 4.92 # 04/23/99 14,954,900
50,000,000 Sigma Finance Incorporated++ 4.82 # 04/15/99 49,906,278
20,000,000 Sigma Finance Incorporated++ 4.82 # 04/26/99 19,933,056
69,513,000 Thames Asset Global Securitization
Incorporated++ 4.86 # 06/30/99 68,668,417
50,000,000 Variable Funding Capital Corporation++ 4.85 # 06/17/99 49,481,319
50,000,000 Variable Funding Capital Corporation++ 4.89 # 04/05/99 49,972,833
50,000,000 WCP Funding Incorporation++ 4.86 # 04/22/99 49,858,250
25,000,000 Windmill Funding Corporation++ 4.84 # 05/19/99 24,838,833
21,209,000 Windmill Funding Corporation++ 4.87 # 05/07/99 21,105,712
75,000,000 Windmill Funding Corporation++ 4.88 # 04/05/99 74,959,333
--------------
TOTAL COMMERCIAL PAPER $4,662,546,542
(Cost $4,662,546,542)
CORPORATE BONDS & NOTES - 17.42%
$50,000,000 Abbey National Treasury Service 5.64 % 07/15/99 $ 50,042,885
70,000,000 American Express Centurion Bank 4.94 12/14/99 70,000,000
174,500,000 Bank of America Corporation 4.94 07/07/99 174,500,000
70,000,000 Bank of America Corporation 4.95 # 04/05/00 69,972,413
75,000,000 Beta Finance Incorporated 5.26 03/06/00 75,000,000
15,000,000 CC USA Incorporated 5.78 06/11/99 14,999,420
45,000,000 Centari Corporation 5.75 04/23/99 45,000,000
</TABLE>
8
<PAGE>
PORTFOLIO OF INVESTMENTS - MARCH 31, 1999 Money Market Fund
- ------------------------------------------------------------------------
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL SECURITY NAME RATE DATE VALUE
<C> <S> <C> <C> <C> <C>
CORPORATE BONDS & NOTES (CONTINUED)
$25,000,000 Comerica Bank 4.92 % 02/08/00 $ 24,990,494
150,000,000 Comerica Bank 4.94 01/10/00 149,965,529
75,000,000 FCC National Bank 5.14 03/22/00 74,975,430
50,000,000 FCC National Bank 5.67 06/01/99 49,990,002
120,000,000 First National Bank 5.05 04/08/99 120,000,000
70,000,000 First National Bank 5.73 05/19/99 69,992,949
46,000,000 First National Bank 5.75 05/10/99 45,997,647
75,000,000 First Union National Bank 5.25 09/17/99 75,000,000
180,000,000 First Union National Bank 5.35 09/09/99 180,000,000
48,000,000 Huntington National Bank 5.74 05/05/99 47,998,073
60,000,000 IBM Credit Corporation 4.67 10/29/99 59,985,259
95,500,000 IBM MTN 5.58 08/27/99 95,479,864
165,000,000 JP Morgan & Company Incorporated 4.86 09/15/99 165,000,000
55,000,000 Sigma Finance Incorporated 5.19 02/25/00 55,000,000
80,000,000 Sigma Finance Incorporated 5.23 03/29/00 80,000,000
--------------
TOTAL CORPORATE BONDS & NOTES $1,793,889,965
(Cost $1,793,889,965)
SHORT-TERM FEDERAL AGENCIES - 3.19%
$71,997,000 Federal Home Loan Banks 4.68 %# 07/02/99 71,135,915
7,500,000 Federal Home Loan Banks 4.79 02/04/00 7,480,800
26,000,000 Federal National Mortgage Association 4.97 08/19/99 25,992,670
50,000,000 Federal Home Loan Mortgage Corporation 4.77 # 04/06/99 49,966,875
99,100,000 Federal National Mortgage Association 4.67 # 07/15/99 97,750,175
25,000,000 Federal National Mortgage Association 4.70 # 06/23/99 24,729,097
50,000,000 Federal National Mortgage Association 4.75 # 06/14/99 49,511,805
2,000,000 Student Loan Mortgage Association 5.63 06/02/99 2,002,433
--------------
TOTAL SHORT-TERM FEDERAL AGENCIES $ 328,569,770
(Cost $328,569,770)
</TABLE>
9
<PAGE>
Money Market Fund PORTFOLIO OF INVESTMENTS - MARCH 31, 1999
- ------------------------------------------------------------------------
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL SECURITY NAME RATE DATE VALUE
<C> <S> <C> <C> <C> <C>
CERTIFICATES OF DEPOSIT - 20.19%
$50,000,000 American Express Centurion Bank 4.85 % 04/23/99 $ 50,000,000
75,000,000 American Express Credit Corporation 4.87 04/05/99 75,000,000
75,000,000 Branch Banking & Trust Company 5.01 01/10/00 75,005,219
50,000,000 Branch Banking & Trust Company 5.02 01/21/00 49,986,411
25,000,000 Canadian Imperial Bank of Commerce 5.10 02/22/00 24,991,367
145,000,000 Chase Manhattan Bank 4.87 04/21/99 145,000,000
120,000,000 Chase Manhattan Bank 5.06 05/12/99 120,000,000
100,000,000 Chase Manhattan Bank 5.10 04/20/99 100,000,000
175,000,000 CIBC 4.86 04/20/99 175,000,000
92,200,000 CIBC 5.07 04/13/99 92,200,000
75,000,000 CIBC 5.08 05/04/99 75,000,000
25,000,000 Commerz Bank 5.09 02/16/00 24,992,583
10,000,000 Deutsche Bank 4.85 07/22/99 10,000,000
190,000,000 Deutsche Bank 4.88 05/04/99 190,000,000
75,000,000 Deutsche Bank 4.89 05/11/99 75,000,000
50,000,000 Harris Trust & Savings 4.87 04/22/99 50,000,000
75,000,000 Harris Trust & Savings 5.05 05/05/99 75,000,000
80,000,000 National Westminster Bank 5.13 03/17/00 79,981,537
50,000,000 National Westminster Bank 5.14 04/14/00 49,975,044
50,000,000 Old Kent Bank 4.83 04/28/99 50,000,000
25,000,000 Old Kent Bank 4.83 04/28/99 25,000,000
50,000,000 Old Kent Bank 4.90 10/06/99 50,000,000
25,000,000 Old Kent Bank 5.04 08/13/99 25,000,000
50,000,000 Old Kent Bank 5.06 06/14/99 50,000,000
99,500,000 RaboBank Nederland 5.13 03/24/00 99,453,006
65,500,000 RaboBank Nederland 5.71 05/05/99 65,494,593
70,000,000 RaboBank Nederland 5.74 05/19/99 69,993,830
49,000,000 U.S. Bank N.A. 4.88 05/06/99 49,000,000
23,000,000 U.S. Bank N.A. 4.89 05/10/99 23,000,000
35,000,000 Wachovia Bank 4.85 07/28/99 35,000,000
--------------
TOTAL CERTIFICATES OF DEPOSIT $2,079,073,590
(Cost $2,079,073,590)
</TABLE>
10
<PAGE>
PORTFOLIO OF INVESTMENTS - MARCH 31, 1999 Money Market Fund
- ------------------------------------------------------------------------
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL SECURITY NAME RATE DATE VALUE
<C> <S> <C> <C> <C> <C>
REPURCHASE AGREEMENTS - 2.66%
$102,551,000 Goldman Sachs Pooled Repurchase Agreement -
102% Collateralized by U.S. Government
Securities 4.90 04/01/99 $ 102,551,000
76,976,000 JP Morgan Securities Incorporated Repurchase
Agreement - 102% Collateralized by U.S.
Government Securities 4.88 04/01/99 76,976,000
10,000,000 HSBC Securities Incorporated Repurchase
Agreement - 102% Collateralized by U.S.
Government Securities 4.90 04/01/99 10,000,000
84,293,000 Morgan Stanley & Company Repurchase Agreement -
102% Collateralized by U.S. Government
Securities 4.90 04/01/99 84,293,000
--------------
TOTAL REPURCHASE AGREEMENTS $ 273,820,000
(Cost $273,820,000)
TOTAL INVESTMENTS IN SECURITIES
</TABLE>
<TABLE>
<C> <S> <C> <C>
(Cost $10,384,708,075)* (Note 1) 100.86% $10,384,708,075
Other Assets and Liabilities, Net (0.86) (88,306,852)
------ --------------
TOTAL NET ASSETS 100.00% $10,296,401,223
------ --------------
------ --------------
- ----------------------------------------------------------------------------------------------------------
</TABLE>
++ REPRESENTS COMMERCIAL PAPER SOLD WITHIN TERMS OF PRIVATE PLACEMENT
MEMORANDUM, EXEMPT FROM REGISTRATION UNDER SECTION 4(2) OF THE
SECURITIES ACT OF 1933, THAT MAY BE RESOLD TO QUALIFIED INSTITUTIONAL
BUYERS. THIS SECURITY WAS DEEMED LIQUID BY THE INVESTMENT ADVISER IN
ACCORDANCE WITH PROCEDURES APPROVED BY THE FUND'S BOARD OF DIRECTORS.
# YIELD TO MATURITY.
* COST FOR FEDERAL INCOME TAX PURPOSES IS THE SAME AS FOR FINANCIAL
STATEMENT PURPOSES.
The accompanying notes are an integral part of these financial statements.
11
<PAGE>
THIS PAGE IS INTENTIONALLY LEFT BLANK --
12
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES - MARCH 31, 1999 Money Market Fund
- ------------------------------------------------------------------------
<TABLE>
<CAPTION>
MONEY MARKET
FUND
<S> <C>
ASSETS
INVESTMENTS:
In securities, at market value and
cost (includes repurchase
agreements of $273,820,000) $10,384,708,075
Cash 54,685
RECEIVABLES
Interest 74,808,168
Organization expenses, net of
amortization 5,253
Prepaid expenses 158,492
TOTAL ASSETS 10,459,734,673
LIABILITIES
Payables:
Investment securities purchased 119,947,457
Distribution to shareholders 36,228,067
Due to distributor (Note 2) 1,367,279
Due to adviser (Note 2) 5,660,873
Other 129,774
TOTAL LIABILITIES 163,333,450
TOTAL NET ASSETS $10,296,401,223
NET ASSETS CONSIST OF:
Paid-in capital $10,296,746,950
Undistributed net realized gain (loss)
on investments (345,727)
TOTAL NET ASSETS $10,296,401,223
COMPUTATION OF NET ASSET VALUE AND OFFERING PRICE PER SHARE
Net assets - Class A $ 9,137,811,733
Shares outstanding - Class A 9,137,415,984
Net asset value and offering price per
share - Class A $ 1.00
Net assets - Class S $ 1,158,589,490
Shares outstanding - Class S 1,158,539,945
Net asset value and offering price per
share - Class S $ 1.00
- ------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
13
<PAGE>
STATEMENT OF OPERATIONS - FOR THE YEAR
Money Market Fund ENDED MARCH 31, 1999
- ------------------------------------------------------------------------
<TABLE>
<CAPTION>
MONEY MARKET
FUND
<S> <C>
INVESTMENT INCOME
Interest $476,740,059
TOTAL INVESTMENT INCOME 476,740,059
EXPENSES (NOTE 2)
Advisory fees 35,120,430
Administration fees 6,146,075
Custody fees 1,471,777
Shareholder servicing fees 25,795,807
Portfolio accounting fees 1,817,516
Transfer agency fees 8,678,711
Distribution fees 8,216,099
Organization costs 4,503
Legal and audit fees 415,617
Registration fees 902,701
Directors' fees 2,746
Shareholder reports 538,487
Other 226,727
Total Expenses 89,337,196
Less:
Waived fees and reimbursed expenses (16,069,450)
NET EXPENSES 73,267,746
NET INVESTMENT INCOME 403,472,313
Net realized gain (loss) on sale of
investments 166,441
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $403,638,754
- ---------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
14
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS Money Market Fund
- ------------------------------------------------------------------------
<TABLE>
<CAPTION>
MONEY MARKET FUND
-----------------------------------
FOR THE FOR THE
YEAR ENDED YEAR ENDED
MARCH 31, 1999 MARCH 31, 1998
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS:
Net investment income $ $403,472,313 $ 304,465,191
Net realized gain (loss) on sale of
investments 166,441 495,081
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS 403,638,754 304,960,272
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income
CLASS A (359,769,107) (267,569,450)
INSTITUTIONAL CLASS N/A (188,647)(1)
CLASS S (43,703,206) (36,707,094)
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold - Class A 5,518,795,093 4,063,160,668
Reinvestment of dividends - Class A 351,157,967 255,837,441
Cost of shares redeemed - Class A (3,443,871,290) (2,247,997,951)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CAPITAL SHARE
TRANSACTIONS - CLASS A 2,426,081,770 2,071,000,158
Proceeds from shares sold -
Institutional Class N/A 2,301,111(1)
Reinvestment of dividends -
Institutional Class N/A 215,236(1)
Cost of shares redeemed -
Institutional Class N/A (11,839,183)(1)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CAPITAL SHARE
TRANSACTIONS - INSTITUTIONAL CLASS N/A (9,322,836)(1)
Proceeds from shares sold - Class S 2,191,020,851 1,708,294,353
Reinvestment of dividends - Class S 43,441,848 35,725,155
Cost of shares redeemed - Class S (2,027,066,523) (1,500,695,653)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CAPITAL SHARE
TRANSACTIONS - CLASS S 207,396,176 243,323,855
INCREASE (DECREASE) IN NET ASSETS 2,633,644,387 2,305,496,258
NET ASSETS:
Beginning net assets 7,662,756,836 5,357,260,578
ENDING NET ASSETS $10,296,401,223 $ 7,662,756,836
- --------------------------------------------------------------------------------
</TABLE>
(1) THE INSTITUTIONAL CLASS SHARES CEASED OPERATIONS ON SEPTEMBER 29, 1997.
The accompanying notes are an integral part of these financial statements.
15
<PAGE>
Money Market Fund FINANCIAL HIGHLIGHTS
- ------------------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD IS AS FOLLOWS:
<TABLE>
<CAPTION>
MONEY MARKET FUND
CLASS A
----------------------------------
SIX MONTHS
YEAR ENDED YEAR ENDED ENDED
MARCH 31, MARCH 31, MARCH 31,
1999 1998 1997 (1)
<S> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $1.00 $1.00 $1.00
---------- ---------- ----------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) 0.05 0.05 0.02
Net realized gain (loss) on investments 0.00 0.00 0.00
---------- ---------- ----------
TOTAL FROM INVESTMENT OPERATIONS 0.05 0.05 0.02
LESS DISTRIBUTIONS:
Dividends from net investment income (0.05) (0.05) (0.02)
Distributions from net realized gain 0.00 0.00 0.00
---------- ---------- ----------
TOTAL FROM DISTRIBUTIONS (0.05) (0.05) (0.02)
---------- ---------- ----------
NET ASSET VALUE, END OF PERIOD $1.00 $1.00 $1.00
---------- ---------- ----------
---------- ---------- ----------
TOTAL RETURN (NOT ANNUALIZED) 4.79% 5.07% 2.36%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000s) $9,137,812 $6,711,584 $4,640,148
RATIOS TO AVERAGE NET ASSETS (ANNUALIZED):
Ratio of expenses to average net assets 0.75% 0.75% 0.75%
Ratio of net investment income to average net assets 4.67% 4.95% 4.71%
- -----------------------------------------------------------------------------------------------
Ratio of expenses to average net assets prior to waived
fees and reimbursed expenses 0.93% 0.93% 0.90%
Ratio of net investment income to average net assets prior
to waived fees and reimbursed expenses 4.49% 4.77% 4.56%
- -----------------------------------------------------------------------------------------------
</TABLE>
(1) THE FUND CHANGED ITS FISCAL YEAR-END FROM SEPTEMBER 30 TO MARCH 31.
(2) THE FUND CHANGED ITS FISCAL YEAR-END FROM DECEMBER 31 TO SEPTEMBER 30.
(3) THIS CLASS OF SHARES COMMENCED OPERATIONS ON MAY 25, 1995.
The accompanying notes are an integral part of these financial statements.
16
<PAGE>
FINANCIAL HIGHLIGHTS Money Market Fund
- ------------------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD IS AS FOLLOWS:
<TABLE>
<CAPTION>
MONEY MARKET FUND (CONT.)
CLASS A (CONT.) CLASS S
---------------------------------- ----------------------------------------------------------
NINE NINE
MONTHS SIX MONTHS MONTHS PERIOD
ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED ENDED ENDED ENDED
SEPT. 30, DEC. 31, DEC. 31, MARCH 31, MARCH 31, MARCH 31, SEPT. 30, DEC. 31,
1996 (2) 1995 1994 1999 1998 1997 (1) 1996 (2) 1995 (3)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING
OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income
(loss) 0.03 0.05 0.04 0.04 0.04 0.02 0.03 0.03
Net realized gain (loss)
on investments 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
TOTAL FROM INVESTMENT
OPERATIONS 0.03 0.05 0.04 0.04 0.04 0.02 0.03 0.03
LESS DISTRIBUTIONS:
Dividends from net
investment income (0.03) (0.05) (0.04) (0.04) (0.04) (0.02) (0.03) (0.03)
Distributions from net
realized gain 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
TOTAL FROM DISTRIBUTIONS (0.03) (0.05) (0.04) (0.04) (0.04) (0.02) (0.03) (0.03)
---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
NET ASSET VALUE, END OF
PERIOD $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
TOTAL RETURN (NOT
ANNUALIZED) 3.55% 5.34% 3.74% 4.10% 4.37% 2.02% 3.03% 2.73%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(000s) $3,799,908 $2,892,621 $2,343,942 $1,158,589 $951,172 $707,781 $699,231 $618,899
RATIOS TO AVERAGE NET ASSETS
(ANNUALIZED):
Ratio of expenses to
average net assets 0.75% 0.75% 0.69% 1.42% 1.42% 1.43% 1.42% 1.43%
Ratio of net investment
income to average net
assets 4.66% 5.13% 4.12% 4.01% 4.28% 4.02% 3.98% 4.40%
- ----------------------------------------------------------------------------------------------------------------------------
Ratio of expenses to average
net assets prior to waived
fees and reimbursed
expenses 0.88% 0.83% 0.89% 1.62% 1.62% 1.56% 1.55% 1.53%
Ratio of net investment
income to average net
assets prior to waived
fees and reimbursed
expenses 4.53% 5.05% 3.92% 3.81% 4.08% 3.89% 3.85% 4.30%
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) THE FUND CHANGED ITS FISCAL YEAR-END FROM SEPTEMBER 30 TO MARCH 31.
(2) THE FUND CHANGED ITS FISCAL YEAR-END FROM DECEMBER 31 TO SEPTEMBER 30.
(3) THIS CLASS OF SHARES COMMENCED OPERATIONS ON MAY 25, 1995.
The accompanying notes are an integral part of these financial statements.
17
<PAGE>
Money Market Fund NOTES TO FINANCIAL STATEMENTS
- ------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION
Stagecoach Funds, Inc. (the "Company") is registered under the Investment
Company Act of 1940, as amended (the "1940 Act"), as an open-end series
management investment company. The Company commenced operations on January 1,
1992, and is currently comprised of thirty-one separate series. These financial
statements represent the Money Market Fund (the "Fund"), a diversified series of
the Company.
Prior to August 1, 1998 the Money Market Fund was known as the "Money Market
Mutual Fund".
Effective on September 6, 1996 the Pacifica Funds Trust was consolidated into
the Company in a tax-free exchange for shares of designated classes of the
corresponding Stagecoach fund.
The Fund offers Class A and Class S shares. The separate classes of shares
differ principally in the distribution fees, shareholder servicing fees and
transfer agency fees. Shareholders of each class also bear certain expenses that
pertain to that particular class. All shareholders bear the common expenses of
the Fund and earn income from the portfolio pro rata based on the average daily
net assets of each class, without distinction between share classes. Dividends
are determined separately for each class based on income and expenses allocable
to each class. Realized gains are allocated to each class pro rata based on the
net assets of each class on the date of distribution. No class has preferential
dividend rights. Differences in per share dividend rates generally result from
the relative weightings of pro rata income and realized gain and loss
allocations and from differences in separate class expenses, including
distribution, shareholder servicing and transfer agency fees.
The following significant accounting policies are consistently followed by the
Company in the preparation of its financial statements, and such policies are in
conformity with generally accepted accounting principles ("GAAP") for investment
companies.
The preparation of financial statements in conformity with GAAP requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities, disclosure of contingent assets and liabilities at
18
<PAGE>
NOTES TO FINANCIAL STATEMENTS Money Market Fund
- ------------------------------------------------------------------------
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.
SECURITY VALUATION
The Fund invests only in securities with remaining maturities not exceeding
397 days (thirteen months). Certain floating- and variable-rate instruments in
the portfolio may have maturities in excess of 397 days, but carry a demand
feature that permits the holder to tender the instruments back to the issuer at
par value prior to maturity.
The Fund uses the amortized cost method to value its portfolio securities. The
amortized cost method involves valuing a security at its cost, plus accretion of
discount or minus amortization of premium over the period until maturity, which
approximates market value. The Fund seeks to maintain a constant net asset value
of $1.00 per share, although there is no assurance that it will be able to do
so.
SECURITY TRANSACTIONS AND INCOME RECOGNITION
Securities transactions are recorded on a trade date basis. Interest income is
accrued daily. Realized gains or losses are reported on the basis of identified
cost of securities delivered.
REPURCHASE AGREEMENTS
Transactions involving purchases of securities under agreements to resell such
securities ("repurchase agreements") are treated as collateralized financing
transactions and are recorded at their contracted resale amounts. These
repurchase agreements, if any, are detailed in the Fund's Portfolio of
Investments. The Fund may participate in pooled repurchase agreement
transactions with other funds advised by Wells Fargo Bank, N.A. ("WFB"). The
repurchase agreements must be fully collateralized based on values that are
marked to market daily. The collateral may be held by an agent bank under a tri-
party agreement. It is the custodian's responsibility to value collateral daily
and to take action to obtain additional collateral as necessary to maintain
market value equal to or greater than the resale price. The repurchase
agreements held by the Fund are collateralized by instruments such as U.S.
Treasury or federal agency obligations.
19
<PAGE>
Money Market Fund NOTES TO FINANCIAL STATEMENTS
- ------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
Dividends to shareholders from net investment income, if any, are declared
daily and distributed monthly. Any distributions to shareholders from net
realized capital gains are declared and distributed at least annually.
FEDERAL INCOME TAXES
The Fund is treated as a separate entity for federal income tax purposes. It
is the policy of each Fund of the Company to continue to qualify as a regulated
investment company by complying with the provisions applicable to regulated
investment companies, as defined in the Code, and to make distributions of
substantially all of its investment company taxable income and any net realized
capital gains (after reduction for capital loss carryforwards) sufficient to
relieve it from all, or substantially all, federal income taxes. Accordingly, no
provision for federal income taxes was required at March 31, 1999.
The Fund had an estimated net capital loss carryforward at March 31, 1999 of
$345,727 that will expire in the year 2003. The Company's Board of Directors
intends to offset net capital gains with each capital loss carryforward, and no
capital gain distribution shall be made until each such carryforward has been
fully utilized or expires.
Due to the timing of dividend distributions and the differences in accounting
for income and realized gains (losses) for financial statement and federal
income tax purposes, the fiscal year in which amounts are distributed may differ
from the year in which the income and realized gains (losses) were recorded by
the Fund. The differences between the income or gains distributed on a book
versus tax basis are shown as excess distributions of net investment income and
net realized gain on sales of investments in the accompanying Statements of
Changes in Net Assets. The amount of distributions from net investment income
and net realized capital gains are determined in accordance with federal income
tax regulations, which may differ from GAAP. These "book/tax" differences are
either considered temporary or permanent in nature. To the extent that these
differences are permanent in nature, such amounts are reclassified within the
capital accounts based on their federal tax-basis treatment; temporary
differences do not require reclassifications.
20
<PAGE>
NOTES TO FINANCIAL STATEMENTS Money Market Fund
- ------------------------------------------------------------------------
DEFERRED ORGANIZATION COSTS
Certain costs incurred in connection with the organization of the Fund and its
initial registration with the Securities and Exchange Commission and with the
various states are amortized on a straight-line basis over 60 months from the
date the Fund commenced operations.
2. AGREEMENTS AND OTHER TRANSACTIONS WITH AFFILIATES
The Company has entered into an advisory contract on behalf of the Fund with
WFB. Pursuant to the contract, WFB has agreed to provide the Fund with daily
portfolio management. Under the contract, WFB is entitled to be paid a monthly
advisory fee at an annual rate of 0.40% of the Fund's average daily net assets.
On August 1, 1998, Wells Capital Management Incorporated ("WCM"), a wholly-owned
subsidiary of WFB, began acting as investment sub-advisor to the Fund. WCM is
entitled to receive from WFB, as compensation for its sub-advisory services to
the Fund, a monthly fee at the annual rate of 0.05% of the Fund's average daily
net assets up to $960 million and 0.04% of the Fund's average daily net assets
in excess of $960 million. WCM's minimum annual fee is $120,000 for the Fund.
This minimum annual fee does not increase the advisory fees paid by the Funds to
WFB.
The Company has entered into a contract on behalf of the Fund with WFB,
whereby WFB is responsible for providing custody and portfolio accounting
services for the Fund. Pursuant to the contract, WFB is entitled to certain
transaction charges plus a monthly fee for custody services at an annual rate of
0.0167% of the average daily net assets of the Fund. For portfolio accounting
services, WFB is entitled to a monthly base fee of $2,000 plus an annual fee of
0.07% of the first $50 million of the Fund's average daily net assets, 0.045% of
the next $50 million, and 0.02% of the Fund's average daily net assets in excess
of $100 million.
The Company has entered into a contract on behalf of the Fund with WFB,
whereby WFB provides transfer agency services for the Fund. Under the transfer
agency contract, WFB is entitled to receive transfer agency fees at an annual
rate of 0.10% of the average daily net assets of the Fund.
The transfer agency fees paid on behalf of the Fund for the year ended March
31, 1999 were $7,691,076 for Class A shares and $987,635 for Class S shares.
The Company has entered into a contract on behalf of the Fund with WFB,
whereby WFB has agreed to provide shareholder services for the Fund. Pursuant
21
<PAGE>
Money Market Fund NOTES TO FINANCIAL STATEMENTS
- ------------------------------------------------------------------------
to the contract, WFB is entitled to receive shareholder servicing fees at an
annual rate of 0.30% of the average daily net assets of the Class A shares of
the Fund and 0.25% of the average daily net assets of the Class S shares of the
Fund.
Shareholder servicing fees paid on behalf of the Fund for the year ended March
31, 1999 were $23,073,231 for Class A shares and $2,722,576 for Class S shares.
Prior to March 25, 1999, the Company had entered into administration
agreements on behalf of the Funds whereby WFB as administrator and Stephens Inc.
("Stephens") as co-administrator provided each Fund with administration
services. Under the prior arrangement, WFB and Stephens were entitled to receive
monthly fees at the annual rates of 0.03% and 0.04%, respectively, of each
Fund's average daily net assets.
On March 25, 1999, the Company entered into an Administration Agreement with
WFB on behalf of the Funds. Under the Administration Agreement, WFB will act as
the sole Administrator of the Funds and is entitled to receive monthly fees at
an annual rate of 0.15% of the average daily net assets of the Funds.
The Company has adopted separate Distribution Plans for Class A and Class S
shares of the Fund pursuant to Rule 12b-1 under the 1940 Act (each, a "Plan").
The Plan for Class A shares of the Fund provides that the Fund may defray all or
part of the cost of preparing, printing and distributing prospectuses and other
promotional materials by paying for costs incurred on an annual basis of up to
0.05% of the average daily net assets attributable to the Class A shares of the
Fund.
Under the Plan for Class S shares of the Fund, the Fund may pay to Stephens,
as compensation for distribution-related services or as reimbursement for
distribution-related expenses, a monthly fee at an annual rate of 0.75% of the
average daily net assets attributable to its Class S shares.
The Fund may participate in joint distribution activities with other Funds, in
which event, expenses reimbursed out of the assets of one of the Funds may be
attributable, in part, to the distribution-related activities of another Fund.
Generally, the expenses of joint distribution activities are allocated among the
Funds in proportion to their relative net asset sizes.
Distribution fees paid on behalf of the Fund for the year ended March 31, 1999
were $48,371 for Class A shares and $8,167,728 for Class S shares.
The registration fees paid on behalf of the Fund for the year ended March 31,
1999 were $797,850 for Class A shares and $104,851 for Class S shares.
22
<PAGE>
NOTES TO FINANCIAL STATEMENTS Money Market Fund
- ------------------------------------------------------------------------
WAIVED FEES AND REIMBURSED EXPENSES
The amount shown as waived fees and reimbursed expenses on the Statement of
Operations for the year ended March 31, 1999, was waived by WFB. Waived fees and
reimbursed expenses continue at the discretion of WFB.
Certain officers and one director of the Company are also officers of
Stephens. As of March 31, 1999, Stephens owned 13,060 shares of the Fund.
3. CAPITAL SHARE TRANSACTIONS
As of March 31, 1999, there were over 242 billion shares of $0.001 par value
capital stock authorized by the Company. As of March 31, 1999, the Fund was
authorized to issue 10 billion shares of $0.001 par value capital stock for each
class of shares. Capital shares are issued and redeemed at a constant $1.00 net
asset value as disclosed in the Statement of Changes in Net Assets.
Capital share transactions for the Funds were as follows:
<TABLE>
<CAPTION>
MONEY MARKET FUND
-----------------------------------
FOR THE FOR THE
YEAR ENDED YEAR ENDED
MARCH 31, 1999 MARCH 31, 1998
- -------------------------------------------------------------------------------------------------
<S> <C> <C>
SHARES ISSUED AND REDEEMED:
Shares sold -- Class A 5,518,795,093 4,063,073,840
Shares issued in reinvestment of dividends -- Class A 351,157,967 255,837,441
Shares redeemed -- Class A (3,443,871,290) (2,247,997,951)
NET INCREASE (DECREASE) IN SHARES OUTSTANDING -- CLASS A 2,426,081,770 2,070,913,330
Shares sold -- Class S 2,191,020,851 1,708,294,353
Shares issued in reinvestment of dividends -- Class S 43,441,848 35,725,154
Shares redeemed -- Class S (2,027,066,523) (1,500,695,653)
NET INCREASE (DECREASE) IN SHARES OUTSTANDING -- CLASS S 207,396,176 243,323,854
</TABLE>
4. SUBSEQUENT EVENTS
On March 25, 1999, the Board of Directors of the Company approved the
reorganization of the Funds into new portfolios of Wells Fargo Funds Trust. The
reorganization is part of a larger plan to consolidate the Stagecoach Family of
Funds with the Norwest Advantage Family of Funds following last November's
merger of Wells Fargo & Company and Norwest Corporation. The Company will
present the reorganization to Fund shareholders for their approval at a special
shareholders' meeting that is planned for August 1999.
23
<PAGE>
Equity Funds INDEPENDENT AUDITORS' REPORT
- ------------------------------------------------------------------------
INDEPENDENT AUDITORS' REPORT
To the Shareholders and Board of Directors
Stagecoach Funds, Inc.:
We have audited the accompanying statement of assets and liabilities,
including the portfolio of investments, of the Money Market Fund (one of the
funds comprising Stagecoach Funds, Inc.) as of March 31, 1999, and the related
statement of operations for the year then ended, the statement of changes in net
assets for each of the years in the two-year period then ended, and financial
highlights for the periods indicated herein. These financial statements and
financial highlights are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards required that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of March
31, 1999, by correspondence with the custodian and other appropriate audit
procedures. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
Money Market Fund of Stagecoach Funds, Inc. as of March 31, 1999, the results of
its operations, the changes in its net assets, and its financial highlights for
the periods indicated herein, in conformity with generally accepted accounting
principles.
[SIGNATURE]
San Francisco, California
May 7, 1999
24
<PAGE>
THIS PAGE IS INTENTIONALLY LEFT BLANK --
25
<PAGE>
LIST OF ABBREVIATIONS
- ------------------------------------------------------------------------
The following is a list of common abbreviations for terms and entities which
may have appeared in this report.
<TABLE>
<S> <C> <C>
ABAG -- Association of Bay Area Governments
ADR -- American Depository Receipts
AMBAC -- American Municipal Bond Assurance Corporation
AMT -- Alternative Minimum Tax
ARM -- Adjustable Rate Mortgages
BART -- Bay Area Rapid Transit
CDA -- Community Development Authority
CDSC -- Contingent Deferred Sales Charge
CGIC -- Capital Guaranty Insurance Company
CGY -- Capital Guaranty Corporation
CMT -- Constant Maturity Treasury
COFI -- Cost of Funds Index
CONNIE LEE -- Connie Lee Insurance Company
COP -- Certificate of Participation
CP -- Commercial Paper
DW&P -- Department of Water & Power
DWR -- Department of Water Resources
EDFA -- Education Finance Authority
FGIC -- Financial Guaranty Insurance Corporation
FHA -- Federal Housing Authority
FHLMC -- Federal Home Loan Mortgage Corporation
FNMA -- Federal National Mortgage Association
FRN -- Floating Rate Notes
FSA -- Financial Security Assurance, Inc
GNMA -- Government National Mortgage Association
GO -- General Obligation
HFA -- Housing Finance Authority
HFFA -- Health Facilities Financing Authority
IDA -- Industrial Development Authority
LIBOR -- London Interbank Offered Rate
LOC -- Letter of Credit
LP -- Limited Partnerships
MBIA -- Municipal Bond Insurance Association
MFHR -- Multi-Family Housing Revenue
MTN -- Medium Term Note
MUD -- Municipal Utility District
PCFA -- Pollution Control Finance Authority
PCR -- Pollution Control Revenue
PFA -- Public Finance Authority
PSFG -- Public School Fund Guaranty
RAW -- Revenue Anticipation Warrants
RDA -- Redevelopment Authority
RDFA -- Redevelopment Finance Authority
R&D -- Research & Development
SFMR -- Single Family Mortgage Revenue
TBA -- To Be Announced
TRAN -- Tax Revenue Anticipation Notes
USD -- Unified School District
V/R -- Variable Rate
</TABLE>
26
<PAGE>
Wells Fargo Bank, N.A. provides investment advisory services, shareholder
services and/or certain other services for the Stagecoach Funds. Wells
Capital Management Incorporated ("WCM") provides investment sub-advisory
services for certain Stagecoach Funds. The Funds are distributed by
STEPHENS INC., Member NYSE/SIPC. Wells Fargo Bank, N.A. and WCM are not
affiliated with Stephens Inc.
This report and the financial statements contained herein are submitted for
the general information of the shareholders of the Stagecoach Funds. If this
report is used for promotional purposes, distribution of the report must be
accompanied or preceded by a current prospectus. For a prospectus containing
more complete information, including charges and expenses, call
1-800-222-8222. Read the prospectus carefully before you invest or send money.
- -C- Stagecoach Funds
STAGECOACH FUNDS-Registered
Trademark-
P.O. Box 7066
San Francisco, CA 94120-7066
DATED MATERIAL
PLEASE EXPEDITE
SC MMS AR (5/99)
