<PAGE>
[LETTERHEAD OF KPMG]
Independent Auditors' Report
To the Board of Trustees of
Norwest Advantage Funds and:
We have examined management's assertion, included in the accompanying Management
Statement Regarding Compliance with Certain Provisions of the Investment Company
Act of 1940, that Cash Investment Fund, U.S. Government Fund, Treasury Fund,
Treasury Plus Fund, Ready Cash Investment Fund, Municipal Money Market Fund,
Stable Income Fund, Limited Term Government Income Fund, Intermediate Government
Income Fund, Diversified Bond Fund, Income Fund, Total Return Bond Fund,
Strategic Income Fund, Limited Term Tax-Free Fund, Tax-Free Income Fund,
Colorado Tax-Free Fund, Minnesota Intermediate Tax-Free Fund, Minnesota Tax-Free
Fund, Moderate Balanced Fund, Growth Balanced Fund, Aggressive Balanced-Equity
Fund, Index Fund, Income Equity Fund, ValuGrowth Stock Fund, Diversified Equity
Fund, Growth Equity Fund, Large Company Growth Fund, Diversified Small Cap Fund,
Small Company Stock Fund, Small Company Growth Fund, Small Cap Opportunities
Fund, International Fund, Performa Strategic Value Bond Fund, Performa
Disciplined Growth Fund, Performa Small Cap Value Fund, WealthBuilder II Growth
Portfolio, WealthBuilder II Growth and Income Portfolio and WealthBuilder II
Growth Balanced Portfolio, portfolios of Norwest Advantage Funds (the "Funds"),
complied with the requirements of subsections (b) and (c) of Rule 17f-2 under
the Investment Company Act of 1940 as of September 30, 1999. Management is
responsible for the Funds' compliance with those requirements. Our
responsibility is to express an opinion on management's assertion about the
Funds' compliance based on our examination.
Our examination was made in accordance with standards established by the
American Institute of Certified Public Accountants and, accordingly, included
examining, on a test basis, evidence about Funds' compliance with those
requirements and performing such other procedures as we considered necessary in
the circumstances. Included among our procedures were the following tests
performed as of September 30, 1999, and with respect to agreement of security
purchases and sales, for the period from May 31, 1999 (date of our last
examination) through September 30, 1999:
(1) Inspection of documentation of all securities located in the vault, if any,
of Norwest Bank Minneapolis, N.A., Custodian;
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[LOGO OF KPMG]
(2) Inspection of documentation of securities held in book entry form by
Participant Trust Company, Bankers Trust Company, Bank of New York, Morgan
Stanley Trust Company, Depository Trust Company, and the Federal Reserve
Bank and examination of selected security position reconciliations;
(3) Inspection of documentation of other securities held in safekeeping by the
Custodian but not included in (1) or (2) above and examination of selected
security position reconciliations;
(4) Confirmation or inspection of documentation of all securities purchased but
not received, hypothecated, pledged, placed in escrow, or out for transfer
with brokers, pledges and/or transfer agents;
(5) Reconciliation of all such securities to the books and records of the Funds
and the Custodian; and
(6) Tests of selected security transactions since the date of our last report.
We believe that our examination provides a reasonable basis for our opinion. Our
examination does not provide a legal determination on the Funds' compliance with
the specified requirements.
In our opinion, management's assertion that Norwest Advantage Funds complied
with the requirements of subsections (b) and (c) of Rule 17f-2 of the Investment
Company Act of 1940 as of September 30, 1999, with respect to securities
reflected in the investment account of Norwest Advantage Funds, is fairly
stated, in all material respects.
This report is intended solely for the information and use of management and the
Board of Trustees of Norwest Advantage Funds and the Securities and Exchange
Commission and is not intended to be and should not be used by anyone other than
these specified parties.
KPMG LLP
Boston, Massachusetts
December 22, 1999
<PAGE>
[LOGO OF WELLS FARGO FUNDS]
December 22, 1999
KPMG LLP
99 High Street
Boston, MA 02110-2317
RE: Management Statement Regarding Compliance with Certain Provisions of the
Investment Company Act of 1940
Ladies and Gentlemen:
We, as members of management of Cash Investment Fund, U.S. Government Fund,
Treasury Fund, Treasury Plus Fund, Ready Cash Investment Fund, Municipal Money
Market Fund, Stable Income Fund, Limited Term Government Income Fund,
Intermediate Government Income Fund, Diversified Bond Fund, Income Fund, Total
Return Bond Fund, Strategic Income Fund, Limited Term Tax-Free Fund, Tax-Free
Income Fund, Colorado Tax-Free Fund, Minnesota Intermediate Tax-Free Fund,
Minnesota Tax-Free Fund, Moderate Balanced Fund, Growth Balanced Fund,
Aggressive Balanced-Equity Fund, Index Fund, Income Equity Fund, ValuGrowth
Stock Fund, Diversified Equity Fund, Growth Equity Fund, Large Company Growth
Fund, Diversified Small Cap Fund, Small Company Stock Fund, Small Company Growth
Fund, Small Cap Opportunities Fund, International Fund, Performa Strategic Value
Bond Fund, Performa Small Cap Value Fund, WealthBuilder II Growth Portfolio,
WealthBuilder II Growth and Income Portfolio and WealthBuilder II Growth Balance
Portfolio, portfolios of Norwest Advantage Funds (the "Funds") are responsible
for complying with the requirements of subsections (b) and (c) of Rule 17f-2,
"Custody of Investments by Registered Management Investment Companies," of the
Investment Company Act of 1940. We are also responsible for establishing and
maintaining effective internal controls over compliance with those requirements.
We have performed an evaluation of the Funds' compliance with the requirements
of subsections (b) and (c) of Rule 17f-2 as of September 30, 1999 and for the
period from May 31, 1999 (date of your last examination) through September 30,
1999.
Based on this evaluation, we assert that the Funds were in compliance with the
requirements of subsections (b) and (c) of Rule 17f-2 of the Investment Company
Act of 1940 as of September 30, 1999 and for the period from May 31, 1999 (date
of your last examination) to September 30, 1999 with respect to securities
reflected in the investment accounts of the Norwest Advantage Funds.
Sincerely,
/s/ Karla M Rabusch
Karla Rasbusch
Vice President and
Chief Financial Officer
Wells Fargo Mutual Funds Group
<PAGE>
FORM ????
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OMB Number: 3235-0360
Expires: July 31, 1991
Estimated average burden
hours per response..0.05
------------------------
Certificate of Accounting of Securities and Similar
Investments in the Custody of
Management Investment Companies
Pursuant to Rule 17F-2 [17 CFR 270, 17F-2]
<TABLE>
<CAPTION>
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1. Investment Company Act File Number: Date examination completed:
811- 488 9/30/99
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2. State identification Number:
<S> <C> <C> <C> <C> <C>
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AL N/A AK 9904218 AZ 5003536 QUAL AR 91MO33423 CA 5057965 CO 109305936
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CT 5125881 DE N/A DC EXEMPT FL EXEMPT GA 56930783 HI N/A
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ID 46181 IL R9840128 IN 9103541IC IA 126950 KS 9480000039 KY M33347
------------------------------------------------------------------------------------------------------------------
LA 60364 ME MFR9913894 MD 5M941635 MA N/A MI 26539 MN R299251
------------------------------------------------------------------------------------------------------------------
MS MF 9307034 MO 000001020 MT 32165 NE N/A NV N/A NH N/A
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NJ EXEMPT NM 998093 NY 5255803 NC 1336 ND 13183 OH 16782
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OK SE2005441 OR 960586 PA 8803053MF RI N/A SC MF 8176 SD 8184
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TN RM991891 TX M43019 UT 29130006 VT 7/26/93 03 VA 1654 WA C36719
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WV MF17656 WI 2292203 WY 18986 PUERTO RICO NOT FILED
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Other (specify):
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3. Exact name of investment company as specified in registration statement:
Norwest Advantage Funds
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4. Name under which business is conducted, if different from above:
- -----------------------------------------------------------------------------------------------------------------------
5. Address of principal place of business (number, street, city, state, zip code):
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>
INSTRUCTIONS
This form must be completed by investment companies that have custody of
securities or similar investments.
Investment Company
1. All items must be completed by the investment company.
2. Give this Form the independent public accountant who, in compliance with Rule
17F-2 under the Act and applicable state law, examines securities and similar
investments in the custody or the investment company.
Accountant
3. Submit this Form to the Securities and Exchange Commission and appropriate
state securities administrators when filing the certificates of accounting
required by Rule 17f-2 under the Act and applicable state law. File the
original and one copy with the Securities and Exchange Commission's principal
office in Washington, D.C. one copy with the regional office for the region
in which the investment company's principal business operations are
conducted, and one copy with the appropriate state administrator(s), if
applicable.
THIS FORM MUST BE GIVEN TO YOUR INDEPENDENT PUBLIC ACCOUNTANT
NOTE: The estimated average burden hours are made solely for purposes of the
Paperwork Reduction Act, and are not derived from a comprehensive or even
a representative survey or study of the costs of SEC rules and forms.
Direct any comments concerning the accuracy of the estimated average
burden hours for compliance with SEC rules and forms to Kenneth A. Fogash,
Deputy Executive Director, U.S. Securities and Exchange Commission, 450
Fifth street, N.W., Washington, D.C. 20549 and Gary Waxman, Clearance
Officer, Office of Management and Budget, Room 3208 New Executive Office
Building, Washington, D.C. 20503.
