Annual
Report
[LOGO]
to Shareholders
May 31, 1999
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TABLE OF CONTENTS
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LETTER TO SHAREHOLDERS 1
PERFORMANCE HIGHLIGHTS 2
TERMS YOU NEED TO KNOW 4
FUND OBJECTIVES 5
INVESTMENT ADVISER'S REPORT 6
MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE 11
FINANCIAL STATEMENTS 26
REPORT OF INDEPENDENT ACCOUNTANTS 107
NOTICE TO SHAREHOLDERS 108
BOSTON 1784 FUNDS:
[ ] ARE NOT INSURED BY THE FDIC OR ANY OTHER GOVERNMENTAL AGENCY;
[ ] ARE NOT GUARANTEED BY BANKBOSTON, N.A. OR ANY OF ITS AFFILIATES;
[ ] ARE NOT DEPOSITS OR OBLIGATIONS OF BANKBOSTON, N.A. OR ANY
OF ITS AFFILIATES;
[ ] INVOLVE INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF THE PRINCIPAL
AMOUNT INVESTED.
BANKBOSTON, N.A. SERVES AS INVESTMENT ADVISER AND SHAREHOLDER
SERVICING AGENT FOR BOSTON 1784 FUNDS. BOSTON 1784 FUNDS ARE
DISTRIBUTED BY SEI INVESTMENTS DISTRIBUTION CO., A PARTY INDEPENDENT
OF BANKBOSTON, N.A. AND ITS AFFILIATES. INVESTMENT COUNSELORS
ARE REGISTERED REPRESENTATIVES OF BANKBOSTON INVESTOR SERVICES,INC.
(MEMBER NASD/SIPC), A WHOLLY-OWNED SUBSIDIARY OF BANKBOSTON, N.A.
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BOSTON 1784 FUNDS
LETTER TO SHAREHOLDERS
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[PHOTO] [PHOTO]
Catherine N. Thornton Robert Nesher
Managing Director President
It is a pleasure to provide this Annual Report on the strategies and performance
of Boston 1784 Funds for the fiscal year ended May 31, 1999.
Over the past year, the assets of the Boston 1784 Funds family continued to
grow, reaching nearly $9.6 billion in total assets as of May 31, 1999. Moreover,
several of our Funds performed well in the past year. Based on total return for
the year ended May 31, 1999:
[_] BOSTON 1784 MASSACHUSETTS TAX-EXEMPT INCOME FUND ranked 1st of 10 funds in
the Lipper Massachusetts Intermediate Municipal Funds category. Based on
five year total return, the Fund ranked 1st of 7 funds in that category.
[_] BOSTON 1784 FLORIDA TAX-EXEMPT INCOME FUND ranked 3rd of 15 funds in the
Lipper Florida Intermediate Municipal Funds category.
[_] BOSTON 1784 RHODE ISLAND TAX-EXEMPT INCOME FUND ranked 4th of 80 funds in
the Lipper Other States Intermediate Municipal Debt Funds category.
[_] BOSTON 1784 TAX-FREE MONEY MARKET FUND ranked 11th of 127 funds in the
Lipper Tax-Exempt Money Market Funds category. Based on five year total
return, the Fund ranked 10th of 104 funds in that category.
[_] BOSTON 1784 TAX-EXEMPT MEDIUM-TERM INCOME FUND ranked 20th of 134 funds in
the Lipper Intermediate Municipal Debt Funds category. Based on five year
total return, the Fund ranked 9th of 88 funds in that category.
You'll find detailed information on the performance of these and other Boston
1784 Funds in this report. Please remember that a Fund's performance in the past
is not necessarily an indication of how a Fund will do in the future. The Funds'
total returns and resulting rankings reflect advisory fee and expense waivers.
We would also like to call your attention to several changes that may occur in
the coming months. On March 14, 1999, BankBoston Corporation and Fleet Financial
Group, Inc. entered into an Agreement and Plan of Merger, under which the two
institutions will merge to form a new entity - Fleet Boston. BankBoston
Corporation is the parent company of BankBoston, N.A., the investment adviser or
co-investment adviser of Boston 1784 Funds. The proposed merger is subject to
regulatory and shareholder approval and other conditions, and is expected to be
effective in the last quarter of 1999. If the merger occurs, BankBoston, N.A.
will become a subsidiary of the merged company.
If you have questions about any Boston 1784 Fund, or about your overall
investment strategy, please feel free to contact your Investment Counselor.
Please remember that you can work with a representative to get information on
your account or buy Boston 1784 Funds by calling 1-800-BKB-1784, Monday through
Friday from 8 a.m. to 6 p.m. (Eastern time). If you prefer, you can use our
automated system at any time, 24 hours a day.
Thank you for your continued investment in Boston 1784 Funds.
Sincerely,
/s/ Robert Nesher /s/ Catherine N. Thornton
----------------- --------------------------------------
Robert Nesher Managing Director, Investment Services
President BankBoston, N.A.
Boston 1784 Funds
1
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<TABLE>
<CAPTION>
PERFORMANCE HIGHLIGHTS OF THE FUNDS
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FOR THE PERIOD JUNE 1, 1998 THROUGH MAY 31, 1999
TOTAL INCOME
TOTAL NET ASSETS RETURN NAV SHARE PRICE YIELD DISTRIBUTIONS
---------------------------------------------------------------------------------------------
5-31-99 5-31-99 HIGH LOW 30-DAY 7-DAY PER
(IN MILLIONS) SHARE
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MONEY MARKET FUNDS
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<S> <C> <C> <C> <C> <C> <C> <C> <C>
Boston 1784 Tax-Free Money Market $969.4 3.01% $ 1.00 $ 1.00 $ 1.00 N/A 3.02% $0.03
Boston 1784 U.S. Treasury Money Market 390.8 4.55 1.00 1.00 1.00 N/A 4.18 0.04
Boston 1784 Prime Money Market 165.2 4.78 1.00 1.00 1.00 N/A 4.23 0.05
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BOND FUNDS
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Boston 1784 Short-Term Income $176.0 4.70% $10.02 $10.28 $10.02 5.21% N/A $0.54
Boston 1784 Income 343.2 2.83 9.93 10.74 9.93 5.66 N/A 0.55
Boston 1784 U.S. Government
Medium-Term Income 276.8 3.73 9.45 10.03 9.45 5.17 N/A 0.51
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TAX-EXEMPT INCOME FUNDS
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Boston 1784 Tax-Exempt
Medium-Term Income $357.0 4.24% $10.33 $10.84 $10.33 4.15% N/A $0.45
Boston 1784 Connecticut
Tax-Exempt Income 187.7 3.72 10.67 11.11 10.67 4.09 N/A 0.48
Boston 1784 Florida
Tax-Exempt Income 68.8 3.88 10.12 10.60 10.12 4.05 N/A 0.44
Boston 1784 Massachusetts
Tax-Exempt Income 267.9 4.10 10.39 10.70 10.38 4.03 N/A 0.45
Boston 1784 Rhode Island
Tax-Exempt Income 102.1 4.11 10.50 10.90 10.50 4.21 N/A 0.47
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STOCK FUNDS
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Boston 1784 Asset Allocation $ 53.4 5.92% $14.97 $15.76 $13.95 N/A N/A $0.39
Boston 1784 Growth and Income 549.4 4.65 22.17 24.14 17.93 N/A N/A 0.03
Boston 1784 Growth 185.5 (3.54) 12.06 13.39 8.51 N/A N/A --
Boston 1784 International Equity 389.8 (4.85) 12.92 14.73 10.23 N/A N/A 0.03
</TABLE>
Performance data represents past results and is no guarantee of future results.
Investment return and principal value will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original cost. Yield
fluctuates. Yield reflects the portfolio's earning power, net of fund expenses.
An investment in a money market fund is not insured or guaranteed by the Federal
Deposit Insurance Corporation or any other government agency. Although money
market funds seek to preserve the value of your investment at $1.00 per share,
it is possible to lose money by investing in a money market fund.
2
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BOSTON 1784 FUNDS
TOTAL RETURN FOR THE FISCAL YEAR
ENDED MAY 31, 1999
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BOSTON
1784 FUNDS TOTAL RETURN FOR THE FISCAL YEAR ENDED MAY 31, 1999
Tax-Free Money Market 3.01
U.S. Treasury Money Market 4.55
Prime Money Market 4.78
Short-Term Income 4.70
Income 2.83
U.S. Government Medium-Term Income 3.73
Tax-Exempt Medium-Term Income 4.24
Connecticut Tax-Exempt Income 3.72
Florida Tax-Exempt Income 3.88
Massachusetts Tax-Exempt Income 4.10
Rhode Island Tax-Exempt Income 4.11
Asset Allocation 5.92
Growth and Income 4.65
Growth (3.54)
International Equity (4.85)
Percent (%) -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6
3
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TERMS YOU NEED TO KNOW
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Adviser is an organization employed by a mutual fund to give professional advice
on the fund's investments and asset management practices (also called the
investment adviser).
Assets are the investment holdings and cash owned by a mutual fund.
Average-Weighted-Maturity is an average of the maturity dates of the various
securities in a mutual fund based on the dollar value of those securities. It is
calculated by multiplying the market value of each portfolio security by the
time remaining to its maturity, adding these calculations and then dividing the
total by the market value of the portfolio.
Basis Point is one one-hundredth of a percentage point.
Capital Appreciation is the increase in the market value of a mutual fund's
securities, as reflected in the net asset value of the fund's shares. Capital
appreciation (or growth) is a specific long-term objective of many mutual funds.
Coupon Rate is the stated interest rate on a bond.
Diversification is the practice of investing broadly across a number of
securities to reduce risk; a hallmark of mutual fund investing.
Duration is a weighted average term-to-maturity of a mutual fund security's cash
flow.
Expense Ratio is a fund's cost of doing business -- disclosed in the prospectus
- -- as a percent of its assets.
Income is the dividends, interest, and/or short-term capital gains paid to a
mutual fund's shareholders. Income is earned on a fund's investment portfolio
after deducting operating expenses.
Investment Objective is the goal -- long-term capital growth or current income,
for example -- that an investor and mutual fund pursue together.
Liquidity is the ability to redeem (sell back) all or part of your mutual fund
shares on any business day and receive the current value (which may be more or
less than the original cost).
Management Fee is the amount paid by a mutual fund to the investment adviser for
its services.
Net Asset Value Per Share (NAV) is the market worth of one share of a mutual
fund. This figure is derived by taking a fund's total assets -- securities, cash
and any accrued earnings -- deducting liabilities, and dividing by the number of
shares outstanding.
Principal is the basic amount of money you invest, not to be confused with
reinvested dividends or capital gains.
Total Return is the change in value of an investment from the beginning to the
end of a period, assuming the reinvestment of all distributions. This is based
on a formula set by the Securities and Exchange Commission.
Yield is the percentage rate at which a fund's portfolio earns income for its
investors, based on a formula set by the Securities and Exchange Commission.
4
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BOSTON 1784 FUNDS
FUND OBJECTIVES
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MONEY MARKET FUNDS
[_] Boston 1784 Tax-Free Money Market Fund
To preserve the principal value of a shareholder's investment and maintain
a high degree of liquidity while providing current income that is exempt
from federal income tax.
[_] Boston 1784 U.S. Treasury Money Market Fund
To preserve the principal value of a shareholder's investment and maintain
a high degree of liquidity while providing current income.
[_] Boston 1784 Prime Money Market Fund
To preserve the principal value of a shareholder's investment and maintain
a high degree of liquidity while providing current income.
BOND FUNDS
[_] Boston 1784 Short-Term Income Fund
To provide investors with maximum current income, and, as a secondary goal,
to preserve investors' capital.
[_] Boston 1784 Income Fund
To provide investors with maximum current income, and, as a secondary goal,
to preserve investors' capital.
[_] Boston 1784 U.S. Government Medium-Term Income Fund
To provide investors with current income consistent with preservation of
capital.
TAX-EXEMPT FUNDS
[_] Boston 1784 Tax-Exempt Medium-Term Income Fund
To provide investors with current income, exempt from federal income tax,
consistent with preservation of capital.
<PAGE>
[_] Boston 1784 Connecticut Tax-Exempt Income Fund
To provide investors with current income exempt from both federal and
Connecticut personal income tax, with a secondary goal of preserving
capital.
[_] Boston 1784 Florida Tax-Exempt Income Fund
To provide investors with current income exempt from federal income tax
through Fund shares which are exempt from Florida intangible personal
property tax, with a secondary goal of preserving capital.
[_] Boston 1784 Massachusetts Tax-Exempt Income Fund
To provide investors with current income exempt from both federal and
Massachusetts personal income tax, consistent with preservation of capital.
[_] Boston 1784 Rhode Island Tax-Exempt Income Fund
To provide investors with current income exempt from federal income tax and
Rhode Island personal income and business corporation taxes, with a
secondary goal of preserving capital.
STOCK FUNDS
[_] Boston 1784 Asset Allocation Fund
To provide investors with a favorable total rate of return through current
income and capital appreciation consistent with preservation of capital,
derived from investing in fixed income and equity securities.
[_] Boston 1784 Growth and Income Fund
To provide investors with long-term growth of capital with a secondary goal
of income.
[_] Boston 1784 Growth Fund
To provide investors with capital appreciation. Dividend income, if any, is
incidental to this goal.
[_] Boston 1784 International Equity Fund
To provide investors with long-term growth of capital. Dividend income, if
any, is incidental to this goal.
5
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INVESTMENT ADVISER'S REPORT
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[PHOTO]
Edward G. Riley, Jr.
Chief Investment Officer
When investment advisers and fund managers discuss volatility, they typically
focus on the financial/statistical variety--the kind that can be measured by
numbers like "beta" and "standard deviation." The past year certainly had its
share of that sort of volatility, but it exhibited other varieties as well, as
the pendulum swung rapidly from deflation fears to inflation scares, crashing
foreign markets to recovering Asian economies, growth stocks leadership to
emerging cyclical strength...the list goes on and on. In short, it was one of
the most volatile years of the by-now-elderly economic expansion that has held
sway for 8 years.
Certainly, the U.S. economy continued to expand, growing at remarkable 4%,
6% and 4.3% rates for the calendar quarters ended September 1998, December 1998
and March 1999, respectively. Economic momentum was sustained in the beginning
of 1999 by a combination of factors: tax refunds and year-end bonuses fueled
spending; low unemployment and rising incomes, which grew faster than inflation,
supported high levels of consumer confidence. And the "Wealth Effect"--the
result of the unprecedented bull market and widespread 401(k) investing in the
stock market--was good for spending and confidence alike.
The "Wealth Effect" is perhaps the most significant variable in any
economic or investing forecast. Surging equity values have pushed stock market
wealth up $4 trillion in the past two years (from $7 trillion to $11 trillion).
Home equity (market price minus mortgage owed) has added another $1 trillion of
perceived wealth, rising from $5 trillion to $6 trillion in the past three
years. With more households now owning equities than ever before (50% today vs.
32% a decade ago), a market correction will affect many more investors. Will new
investors remain patient or will they sell en masse? Complicating matters
further, investor expectations seem to have been ratcheted up to unrealistic
levels by returns that have averaged about 30% over the last four years and
18.6% over the last 18 years--compared with about 10% for the past century.
Surveys show that investors expect annual equity returns in the 15% to 35%
range. What would a year of negative returns, no matter how slight, hold for the
economy?
So the fact that we remain immersed in longest peacetime recovery on record
is both good news and bad news. At this point, after eight years without a
recession, reversion to the mean--whether in the economy or the markets--may
prove very mean indeed.
To be sure, cyclical pressures are building, which forced the Federal
Reserve Board to raise short-term interest rates by .25% in June 1999. But our
long-term view of interest rates remains intact. We see secular disinflation
dominating over the long term for several reasons:
[_] Unit labor costs are declining--good news since 65% of the operating costs
for most companies is labor.
[_] The continued focus on productivity, advances in technology and the
determination to enhance shareholder value
6
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BOSTON 1784 FUNDS
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align management efforts with inflation containment.
[_] Global overcapacity in industries ranging from autos to chemicals should
keep deflationary pressures dominant.
[_] The Internet will force competitive pricing across virtually all goods and
services.
[_] The Federal Reserve Board's vigilant monetary policy--and the readiness of
the "Bond Vigilantes" to bid up interest rates at the first whiff of
inflation--should mitigate any dangerous inflationary tendencies.
STOCK MARKET REVIEW
During the twelve months ended May 31, 1999, the Standard & Poor's 500
Composite Index (the "S&P 500") has gained a very respectable 19%. But the
numbers do not reflect the bumpy ride that got us here. The Dow Jones Industrial
Average (the "Dow") started the Funds' fiscal year at 8952 on June 1, 1998. The
stock market showed signs of health until mid-July, when the Dow began a steep
descent from 9337 in July 1998 to a bottom of 7615 in September 1998. Federal
Reserve Board stimulation in the form of three Federal Funds rate reductions
(from 5.50% to 4.75%) sparked a dramatic eight-month rally. The result: the Dow
bulled its way into recordbreaking 11,000 territory in May 1999, while the S&P
500 rose from 1090 to 1301 during the twelve months ended May 31, 1999. As this
pattern reveals, the stock market had a skittish year. The stock market
initially reacted positively to the just-right Goldilocks mixture of low
interest rates and inflation coupled with strong growth. However, it tumbled
into a fall with weak foreign markets by summer's end, then revived with Federal
Reserve Board help, but recently showed signs of retreating as inflation fears
were rekindled by unexpected economic strength.
[GRAPHIC OMITTED]
In the printed version of the document, a line graph
appears which depicts the following plot points:
Dow Jones Industrial Average
May 31, 1998-May 31, 1999
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
May-98 Jun-98 Jul-98 Aug-98 Sep-98 Oct-98 Nov-98 Dec-98 Jan-99 Feb-99 Mar-99 Apr-99 May-99
8,952 8,883 7,539 7,842 8,592 9,116 9,181 9,358 9,306 9,786 10,789 10,559 10,594
</TABLE>
Despite the strong economic growth of the past three calendar quarters
ended March 1999, profits have increased only 3% among S&P 500 companies,
highlighting a real challenge that still faces U.S. companies. Despite a healthy
economy and strong demand, price-conscious consumers held increases in the
Consumer Price Index to a meager 1.5% over the past 12 months. Moreover, profit
gains were concentrated in a small segment of the market: the top 100 companies
of the S&P
7
<PAGE>
500. In the first quarter of 1999, these giants recorded earnings gains of about
8% on profit margins of 11.5%. By contrast, companies 401 to 500 registered a
small decline in earnings and a paltry profit margin of 5.5%.
That strong performance of large-cap companies has led to soaring
valuations and unrealistic expectations. The 100 largest companies in the S&P
500 boast price/earning ratios of about 32-times, while the bottom 100 trade for
about half that. Of perhaps greater concern, Wall Street consensus estimates are
for a 21% rate of earnings growth in the second half of the year--by our lights,
much too high. Companies are far leaner and more productive than just a few
years ago. Moreover, earnings windfalls created by lower corporate taxes and
declining interest costs are behind us. Consider that interest costs were 20% of
earnings (before income taxes and depreciation) in 1992; they were 8% in 1998.
Consequently, profit growth must start at the top line with revenues. Yet top
line growth is missing, with many big-name growth companies recording only small
single-digit revenue gains.
Continued global competition, sustained resistance to price increases and
tightening labor markets will continue to exert pressure on profits. That said,
however, while we had started 1999 expecting flat earnings, a strong first half
has led us to revise our forecast upward to perhaps a 5% increase.
We should note that despite the dominance of large-cap/growth stocks during
the period, leadership began to shift toward more cyclical stocks in
1999--stocks with performance linked more closely to economic strength.
Recently, we have seen also new signs of life in the small- and mid-cap areas of
the stock market. Some analysts see these trends as signaling a real change in
the market and the economy--a resurrection of the economic cycle of
growth-inflation-Federal Reserve Board intervention-recession. We disagree,
however, and expect large-cap growth issues to reassert their leadership as the
year develops.
Over the short term, we are likely to encounter some familiar hurdles:
overly optimistic earnings estimates, which exacerbate disappointment and price
declines; increasing day-trader activity, which destabilizes the market; and,
continued speculation in Internet issues, which has driven the stocks of
companies with no earnings to trade for hundreds of times sales, distorting the
rest of the market. Over the long term, however, we expect stocks to continue to
move upward. The interest rate environment
[GRAPHIC OMITTED]
In the printed version of the document, a line graph
appears which depicts the following plot points:
S&P 500 Index
May 31, 1998-May 31, 1999
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
May-98 Jun-98 Jul-98 Aug-98 Sep-98 Oct-98 Nov-98 Dec-98 Jan-99 Feb-99 Mar-99 Apr-99 May-99
1,133 1,120 957 1,017 1,098 1,163 1,229 1,279 1,238 1,286 1,335 1,301 1,301
</TABLE>
8
<PAGE>
should remain favorable. Lower inflation, slower growth, and further coordinated
interest rate cuts may induce the Federal Reserve Board to ease monetary policy
later in the year, enhancing market liquidity in a period when demand is already
high and the supply of stocks is declining due to buybacks and mergers.
BOND MARKET REVIEW
Despite the roller coaster ride in between, the 30-year U.S. Treasury rate is
about where it was twelve months ago: within a few basis points of 6.00%. That's
a far cry, however, from the 4.75% rate last fall. In the preceding weeks and
months, the Russian default, troubled Latin American markets, and the
near-failure of a major hedge fund operator had thoroughly unsettled the market,
and a flight to quality dramatically increased demand and bond prices (which
move in the opposite direction from interest rates).
With the financial markets extremely skittish in the fall of 1998, the
Federal Reserve Board reduced short-term interest rates from 5.50% to 4.75% to
provide liquidity. That stimulus--along with nearly 150 other central bank
easings around the world during the past twelve months--had the desired affect
of sustaining and accelerating widespread economic growth. Now, however, the
bond markets are focused on inflation and are pushing rates up.
Although we foresee little inflationary threat in the immediate future, the
Federal Reserve Board raised interest rates in June 1999 as concerns about
inflationary pressures and an overheated economy mounted. Despite the recent
intervention by the Federal Reserve Board, we expect rates to actually drift
lower in yield over the coming year, and the 30-year U.S. Treasury Bond to yield
between 5.00% and 5.75% by the end of 1999. Indeed, a number of other factors
also argue for lower rates over the next six to twelve months--despite the
current disquiet:
[_] U.S. economic growth is likely to slow during the summer and fall.
[_] Any inflationary spurt should prove short-lived, as secular deflationary
forces take hold (i.e. global overcapacity, declining crude oil prices,
labor insecurity sparked by merger-related layoffs, and additional
financial meltdowns in foreign countries).
[_] As long-term rates rise, some of the $1.7 trillion currently resting in
money market funds will move into bonds, moderating rate increases.
[GRAPHIC OMITTED]
In the printed version of the document, a line graph
appears which depicts the following plot points:
30-Year Treasury Bonds
May 31, 1998-May 31, 1999
May-98 Jul-98 Sep-98 Nov-98 Jan-99 Mar-99 May-99
5.93 5.68 5.20 5.25 5.09 5.63 5.84
9
<PAGE>
[_] Cash flows into bond mutual funds remain strong--about $7 billion to $8
billion per month.
[_] Asset allocation strategies are likely to focus more on bonds as stock
market volatility increases and small- and mid-cap investors move into a
(theoretically) more predictable asset class.
[_] Healthy tax receipts will eliminate the need for government borrowing, and
$100 billion in debt retirement will reduce supply and increase prices and
therefore decrease rates.
MONEY MARKET REVIEW
The year's declining short-term rate environment was no boon to money market
investors. The Federal Funds Rate stood at 5.50% on June 1, 1998. After three
interventions by the Federal Reserve Board in response to declining market and
economic conditions, the rate leveled at 4.75%, where it stood on May 31, 1999.
Short-term interest rates are influenced almost solely by the actions of
the Federal Reserve Board. By raising and lowering the rates that banks pay to
borrow from the government and from each other, they raise and lower the money
supply, thereby encouraging or weakening economic activity. With signs of
inflation on the horizon, the Federal Reserve Board intervened recently to raise
interest rates and slow the economy. We believe such higher rates will be a
short-lived phenomenon and will likely be reduced by subsequent Federal Reserve
Board action late in 1999 or early next year. As a result, while money market
investors may experience flat or weaker returns, equity and bond investors are
likely to discover that their favorable investment environment lives on.
[GRAPHIC OMITTED]
In the printed version of the document, a line graph
appears which depicts the following plot points:
Federal Funds Rate
May 1996-May 1999
May-96 Nov-96 May-97 Nov-97 May-98 Nov-98 May-99
5.24 5.31 5.50 5.50 5.50 4.75 4.75
/s/ Edward G. Riley, Jr.
- ------------------------
Edward G. Riley, Jr.
Chief Investment Officer
BankBoston, N.A.
10
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BOSTON 1784 FUNDS
MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE
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BOSTON 1784 TAX-FREE MONEY MARKET FUND
Objective: To preserve the principal value of a shareholder's investment and
maintain a high degree of liquidity while providing current income that is
exempt from federal income tax.
Boston 1784 Tax-Free Money Market Fund invests primarily in investment-grade
money market securities that pay interest that is exempt from federal income
tax. The Fund's investments include municipal general obligation securities,
which are backed by the taxing power of the issuer, and securities used to
finance a variety of municipal purposes such as hospitals, transportation,
housing, student loans, utilities and industrial development. As of May 31,
1999, the net assets of the Fund totaled $969.4 million compared to $1 billion
on May 31, 1998.
For the year ended May 31, 1999, the Fund had a total return of 3.01%,
compared with returns of 2.71% by the IBC/Financial Data Stockbroker & General
Purpose Tax-Free Average and 2.72% by the Lipper Tax-Exempt Money Market Funds
Average for the same period. Based on total return, the Fund rated among the top
10% (11 of 127) in the Lipper Tax-Exempt Money Market Funds Average for the
twelve months ended May 31, 1999.
The Fund outperformed its benchmarks due to the "barbelled" maturity
structure maintained during the year ended May 31, 1999. The Fund held both
issues with relatively long maturities to increase yield and a large cash
position to take advantage of any short-term market events.
The Fund continues to seek higher yields by purchasing securities issued in
states that have either low or no state income taxes. To lock in higher yields,
the Fund is currently focusing on attractively priced securities with longer
maturities.
BOSTON 1784 TAX-FEE MONEY MARKET FUND
Comparison of Change in the Value of a $10,000 Investment
in Boston 1784 Tax-Free Money Market Fund versus the
IBC/Financial Data Stockbroker & General Purpose Tax-Free
Average and the Lipper Tax-Exempt Money Market Funds Average
[GRAPHIC OMITTED]
In the printed version of the document, a line graph
appears which depicts the following plot points:
Annualized Annualized Annualized
One-Year 3 Year 5 Year Inception to
Return Return Return Date
-------- ----------- ---------- ------------
3.01% 3.19% 3.28% 3.14%
<TABLE>
<CAPTION>
Initial
Investment
Date
6/30/93 May 94 May 95 May 96 May 97 May 98 May 99
------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Boston 1784 Tax-Free Money Market Fund $10,000 $10,221 $10,557 $10,932 $11,284 $11,660 $12,011
IBC/Financial Data Stockholder & General Purpose Avg. $10,000 $10,176 $10,476 $10,807 $11,124 $11,468 $11,779
Lipper Tax-Exempt Money Market Funds Average $10,000 $10,177 $10,478 $10,812 $11,132 $11,477 $11,789
</TABLE>
Past performance of the Fund is not predictive of future performance
* Inception date 6/14/93
11
<PAGE>
BOSTON 1784 U.S. TREASURY MONEY MARKET FUND
Objective: To preserve the principal value of a shareholder's investment and
maintain a high degree of liquidity while providing current income.
Boston 1784 U.S. Treasury Money Market Fund invests primarily in U.S. government
agency securities, U.S. Treasury obligations and repurchase agreements fully
collateralized by U.S. Treasury obligations. The Fund's net assets increased
from $372.7 million on May 31, 1998 to $390.8 on May 31, 1999.
For the year ended May 31, 1999, the Fund had a total return of 4.55%,
compared with returns of 4.61% for the IBC/Financial Data U.S. Government &
Agencies Average and 4.36% for the Lipper U.S. Treasury Money Market Funds
Average for the same period. The 7-day yield as of May 31, 1999 was 4.18%. The
Fund's return reflects a waiver of certain management fees and expenses (see
Financial Highlights).
The Fund is rated AAAm by Standard and Poor's. The rating is based on an
analysis of the Fund's credit quality, market price exposure and management. The
rating signifies that, in the opinion of Standard and Poor's, the Fund offers
excellent safety of investment principal and superior capacity to maintain a
$1.00 per share net asset value at all times. The Fund attempts to maintain
these characteristics through conservative investment practices and strict
internal controls. The Fund is reviewed on a weekly basis by Standard and
Poor's.
The Federal Reserve Board lowered the Federal Funds rate three times in the
second half of 1998 from 5.50% to 4.75%. The interest rate environment therefore
did not favor money market investors during the year ended May 31, 1999.
However, the Fund's investments were concentrated in both shorter maturity U.S.
government agency securities and repurchase agreements and longer maturity U.S.
Treasury securities. The average maturity was from 35 to 45 days, which
positively affected the Fund's performance as interest rates declined.
The Federal Reserve Board tightened monetary policy in June 1999 by raising
short-term interest rates by .25%. Money market investors will benefit for a
period of time from this recent Federal Reserve Board intervention.
BOSTON 1784 U.S. TREASURY MONEY MARKET FUND
Comparison of Change in the Value of a $10,000 Investment
in Boston 1784 U.S. Treasury Money Market Fund versus the
IBC/Financial Data U.S. Government & Agencies Average and the
Lipper U.S. Treasury Money Market Funds Average
[GRAPHIC]
In the printed version of the document, a line graph
appears which depicts the following plot points:
Annualized Annualized Annualized
One-Year 3 Year 5 Year Inception to
Return Return Return Date
-------- ----------- ---------- ------------
4.55% 4.81% 4.88% 4.51%
<TABLE>
<CAPTION>
Initial
Investment
Date
6/30/93 May 94 May 95 May 96 May 97 May 98 May 99
------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Boston 1784 U.S. Treasury Money Market Fund $10,000 $10,249 $10,742 $10,296 $11,845 $12,440 $13,066
IBC/Financial Data U.S. Government & Agencies Avg. $10,000 $10,250 $10,726 $11,270 $11,810 $12,402 $12,973
Lipper U.S. Treasury Money Market Funds Average $10,000 $10,246 $10,716 $11,253 $11,783 $12,354 $12,893
</TABLE>
Past performance of the Fund is not predictive of future performance
* Inception date 6/7/93
12
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
BOSTON 1784 PRIME MONEY MARKET FUND
Objective: To preserve the principal value of a shareholder's investment and
maintain a high degree of liquidity while providing current income.
Boston 1784 Prime Money Market Fund invests primarily in high quality money
market instruments, including short-term U.S. government obligations, corporate
bonds, bank obligations (including certificates of deposit, bankers' acceptances
and fixed time obligations), commercial paper, variable rate demand notes,
taxable municipal securities and repurchase agreements. As of May 31, 1999, the
Fund's net assets grew to $165.2 million from $127.6 million in net assets on
May 31, 1998.
For the twelve months ended May 31, 1999, the Fund had a total return of
4.78%, compared with returns of 4.66% for the IBC/Financial Data First Tier
Money Market Average and 4.82% for the Lipper Money Market Funds Average for the
same period. The 7-day yield as of May 31, 1999 was 4.23%. The Fund's return
reflects a waiver of certain management fees and expenses (see Financial
Highlights).
Federal Reserve Board intervention in the form of three interest rate cuts
during the second half of 1998 did not favor money market investors. However,
the Fund outperformed its benchmarks for the twelve months ended May 31, 1999 by
maintaining a slightly longer average maturity of between 45-55 days, which
positively impacted the Fund's performance in a declining interest rate
environment.
In June 1999, the Federal Reserve Board intervened to tighten monetary
policy as a preemptive move against inflation. The .25% increase in short-term
interest rates will boost returns to money market investors.
BOSTON 1784 PRIME MONEY MARKET FUND
Comparison of Change in the Value of a $10,000 Investment
in Boston 1784 Prime Money Market Fund versus the
IBC/Financial Data First Tier Money Market Average
and the Lipper Money Market Funds Average
[GRAPHIC OMITTED]
In the printed version of the document, a line graph
appears which depicts the following plot points
Annualized Annualized Annualized
One-Year 3 Year 5 Year Inception to
Return Return Return Date
-------- ----------- ---------- ------------
4.78% 4.99% 5.02% 4.46%
<TABLE>
<CAPTION>
Initial
Investment
Date
6/30/91 May 92 May 93 May 94 May 95 May 96 May 97 May 98 May 99
------- ------- ------- ------- ------- ------- ------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Boston 1784 Prime Money Market Fund $10,000 $10,433 $10,745 $11,044 $11,577 $12,191 $12,803 $13,464 $14,107
IBC/Financial Data First Tier Average $10,000 $10,415 $10,711 $11,004 $11,529 $12,126 $12,716 $13,360 $13,982
Lipper Money Market Funds Average $10,000 $10,419 $10,718 $11,011 $11,533 $12,118 $12,696 $13,328 $13,939
</TABLE>
Past performance of the Fund is not predictive of future performance
* Inception date 6/6/91
13
<PAGE>
- --------------------------------------------------------------------------------
BOSTON 1784 SHORT-TERM INCOME FUND
Objective: To provide investors with maximum current income, and, as a secondary
goal, to preserve investors' capital.
Boston 1784 Short-Term Income Fund is designed for investors seeking a higher
yield than from a money market fund and more price stability than a longer-term
bond fund. The Fund invests primarily in debt securities of U.S. issuers,
although it can invest in non-U.S. issuers, including those in developing
countries. The Fund's net assets as of May 31, 1999 were $176.0 million compared
to $197.3 million on May 31, 1998.
The Fund's total return for the year ended May 31, 1999 was 4.70%, compared
to returns of 4.35% for the Lipper Short Investment-Grade Debt Average and
5.21% for the Lehman Mutual Fund 1-5 Year Government/ Corporate Bond Index for
the same period. Based on total return, the Fund placed in the second quartile
(47 of 112) in the Lipper Short Investment-Grade Debt Average for the year ended
May 31, 1999. The Fund's return and resulting ranking reflect a waiver of
certain management fees and expenses (see Financial Highlights).
The Fund achieved its goal of a higher yield than money market funds with
relatively low price volatility by selling higher quality U.S. Treasury issues
while adding higher-yielding short-term securities such as corporate bonds and
government agency securities. Rising inflationary pressures coupled with fears
of restrictive Federal Reserve Board monetary policy caused bond prices to
spiral downward over the quarter ended March 31, 1999. Since the Fund held
short-term debt obligations, it was able to avoid the volatility in the
long-term bond market.
In June 1999, the Federal Reserve Board tightened monetary policy by
raising short-term interest rates by .25% as a preemptive measure against
inflationary pressures. However, rates should trade in a narrow band. The Fund
will maintain its current maturity structure in an effort to avoid price
volatility.
BOSTON 1784 SHORT-TERM INCOME FUND
Comparison of Change in the Value of a $10,000 Investment
in Boston 1784 Short-Term Income Fund versus the
Lehman Mutual Fund 1-5 Year Gov't/Corp. Bond Index
and the Lipper Short Investment-Grade Debt Average
[GRAPHIC OMITTED]
In the printed version of the document, a line graph
appears which depicts the following plot points:
Annualized Annualized
One-Year 3 Year Inception to
Return Return Date
-------- ----------- ------------
4.70% 6.05% 6.03%
<TABLE>
<CAPTION>
Initial
Investment
Date
6/30/94 May 95 May 96 May 97 May 98 May 99
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Boston 1784 Short Term Income Fund $10,000 $10,601 $11,107 $11,826 $12,651 $13,246
Lehman Mutual Fund 1-5 Year Gov't/Corp. Index $10,000 $10,700 $11,236 $12,014 $12,944 $13,618
Lipper Short Investment-Grade Debt Average $10,000 $10,548 $11,080 $11,797 $12,572 $13,119
</TABLE>
Past performance of the Fund is not predictive of future performance
* Inception date 7/1/94
14
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
BOSTON 1784 INCOME FUND
Objective: To provide investors with maximum current income, and, as a secondary
goal, to preserve investors' capital.
Boston 1784 Income Fund is an actively managed portfolio of investment-grade,
intermediate- to long-term securities. The assets of the Fund are diversified
among government obligations, corporate securities, mortgaged-backed securities,
asset-backed securities and Yankee bonds (U.S. dollar-denominated bonds issued
in the U.S. by foreign borrowers). On May 31, 1999, the
average-weighted-maturity of the Fund was approximately 8.7 years and the Fund's
duration was about 5.3 years. The Fund's net assets declined from $392.6 million
on May 31, 1998 to $343.2 million in net assets on May 31, 1999.
For the year ended May 31, 1999, the Fund had a total return of 2.83%,
compared with returns of 4.34% for the Lehman Aggregate Bond Index and 2.52% for
the Lipper Corporate Debt A-Rated Average for the same period. The Fund's return
reflects a waiver of certain management fees and expenses (see Financial
Highlights).
During the past year, the bond market seesawed back and forth between
concerns over deflationary pressures exported from foreign countries and
concerns that strong domestic economic growth might lead to inflation. In the
second half of 1998, the Federal Reserve Board reduced short-term interest rates
by .75% to 4.75% to provide liquidity to skittish financial markets.
The Fund's performance was positively affected by its exposure to higher
quality credits over the course of the year. During the fourth fiscal quarter,
to enhance yields, the Fund reduced its exposure to U.S. Treasury securities and
increased its exposure to investment grade corporate bonds.
Although we foresee little inflationary threat in the immediate future, the
Federal Reserve Board raised short-term interest rates in June 1999 as concerns
about inflationary pressures mounted. We expect longer-term interest rates to
drift lower in yield over the coming year, and the 30-year U.S. Treasury Bond to
yield between 5.00% and 5.75%. Should rates rise, we plan to extend the maturity
structure of the Fund's portfolio. We will continue to focus on U.S. Treasury
securities and high quality domestic corporate debt, since we believe that the
yields offered by foreign corporate debt do not justify the additional risk.
BOSTON 1784 INCOME FUND
Comparison of Change in the Value of a $10,000 Investment
in Boston 1784 Income Fund versus the Lehman Aggregate Bond Index
and the Lipper Corporate Debt A-Rated Average
[GRAPHIC OMITTED]
In the printed version of the document, a line graph
appears which depicts the following plot points:
Annualized Annualized
One-Year 3 Year Inception to
Return Return Date
-------- ----------- ------------
2.83% 6.64% 6.70%
<TABLE>
<CAPTION>
Initial
Investment
Date
7/31/94 May 95 May 96 May 97 May 98 May 99
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Boston 1784 Income Fund $10,000 $10,934 $11,211 $12,143 $13,221 $13,596
Lehman Aggregate Bond Index . $10,000 $10,955 $11,435 $12,387 $13,739 $14,336
Lipper Corporate Debt A-Rated Average $10,000 $10,921 $11,301 $12,167 $13,490 $13,830
</TABLE>
Past performance of the Fund is not predictive of future performance
* Inception date 7/1/94
15
<PAGE>
BOSTON 1784 U.S. GOVERNMENT MEDIUM-TERM INCOME FUND
Objective: To provide investors with current income consistent with preservation
of capital.
Boston 1784 U.S. Government Medium-Term Income Fund is an actively managed
portfolio of U.S. Treasury and U.S. government agency short- to medium-term
securities. The Fund's assets are diversified on a sector basis among U.S.
Treasury, U.S. government agency and mortgaged-backed securities. The Fund's
securities are concentrated in the 2-year to 10-year maturity range. On May 31,
1999, the average-weighted-maturity of the Fund was approximately 5.97 years and
the Fund had a duration of 4.0 years. The Fund grew in net assets from $252.7
million on May 31, l998 to $276.8 million on May 31, 1999.
For the year ended May 31, 1999, the Fund had a total return of 3.73%,
compared with returns of 4.98% for the Lehman Intermediate Government Bond Index
and 3.44% for the Lipper Intermediate U.S. Government Funds Average for the same
period. The Fund's return reflects a waiver of certain management fees and
expenses (see Financial Highlights).
Factors that positively affected the Fund's performance included an
overweighting in both mortgage-backed securities and U.S. government agency
securities. Both sectors added to the income return of the Fund. At the same
time, the Fund maintained a slightly longer duration than the Lipper
Intermediate U.S. Government Funds Average and benefited from declining interest
rates.
During the year ended May 31, 1999, deflationary pressures exported from
foreign countries alternated with concerns that strong domestic economic growth
might lead to inflation. In the second half of 1998, the Federal Reserve Board
reduced short-term interest rates by .75% to 4.75% to provide liquidity to
financial markets. Although we foresee little inflationary threat in the
immediate future, the Federal Reserve Board raised short-term interest rates in
June 1999 by .25% in response to concerns about inflationary pressures. We
expect longer-term interest rates to drift downward over the coming year, and
the 30-year U.S. Treasury Bond to yield between 5.00% and 5.75%. We plan to
extend the maturity structure of the Fund's portfolio if interest rates rise,
primarily by adding intermediate-term U.S. Treasury securities and floating-rate
U.S. government agency securities.
BOSTON 1784 U.S. GOVERNMENT MEDIUM-TERM INCOME FUND
Comparison of Change in the Value of a $10,000 Investment
in Boston 1784 U.S. Government Medium-Term Income Fund versus the
Lehman Intermediate Government Bond Index and the
Lipper Intermediate U.S. Government Funds Average
[GRAPHIC OMITTED]
In the printed version of the document, a line graph
appears which depicts the following plot points:
Annualized Annualized Annualized
One-Year 3 Year 5 Year Inception to
Return Return Return Date
-------- ----------- ---------- ------------
3.73% 6.46% 6.33% 5.15%
<TABLE>
<CAPTION>
Initial
Investment
Date
6/30/93 May 94 May 95 May 96 May 97 May 98 May 99
------- ------ ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Boston 1784 U.S. Gov't. Medium-Term Income Fund $10,000 $9,787 $10,646 $11,024 $11,813 $12,824 $13,303
Lehman Intermediate Government Bond Index $10,000 $9,980 $10,887 $11,380 $12,189 $13,235 $13,894
Lipper Intermediate U.S. Government Funds Average $10,000 $9,826 $10,710 $11,066 $11,837 $12,929 $13,374
</TABLE>
Past performance of the Fund is not predictive of future performance
* Inception date 6/7/93
16
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
BOSTON 1784 TAX-EXEMPT MEDIUM-TERM INCOME FUND
Objective: To provide investors with current income, exempt from federal income
tax, consistent with preservation of capital.
Boston 1784 Tax-Exempt Medium-Term Income Fund is an actively managed,
diversified portfolio of high quality, intermediate-term municipal securities
selected for their potential to achieve maximum tax-free income, a competitive
rate of return and preservation of capital. The Fund attempts to achieve
incremental income yield and price stability by emphasizing both geographical
and sector diversification. On May 31, 1999, the Fund's net assets totaled
$357.0 million compared with $303.6 million on May 31, 1998. Of the Fund's total
assets, 57.3% were rated AAA, 25.1% were rated AA and 11.1% were rated A by
either Standard & Poor's or Moody's.
The Fund's total return for the year ended May 31, 1999 was 4.24%, compared
with a return of 3.72% for the Lipper Intermediate Municipal Debt Funds Average
for the same period, ranking the Fund in the top 15% (20 of 134) of its Lipper
peer group. For the same twelve month period, the total return of the Lehman
7-Year Municipal Bond Index was 4.73%. The Fund's return and resulting ranking
reflect a waiver of certain management fees and expenses (see Financial
Highlights).
The Fund outperformed the Lipper Intermediate Municipal Debt Funds Average
due to a focus on credit quality, premium coupon yields, and slightly longer
maturity and duration. The Fund's .49% total return lag compared to the Lehman
7-Year Municipal Bond Index primarily reflected the Fund's maturity structure
and duration, which adversely affected the Fund's total return during the last
two months of the year ended May 31, 1999.
After hitting historical lows in early October 1998, municipal bond yields
rose from .15% to .5% across all maturities, while Treasury yields rose from
.82% to 1.7% during the same time period. As a result, we believe that municipal
bonds are currently priced well below their fair market values. Continued
productivity gains, worldwide manufacturing overcapacity and deflationary
pressures, along with an anticipated slow-down in personal consumption and
domestic economic growth, will contain inflation and drive interest rates back
toward 5% on the 30-year U.S. Treasury Bond. We have positioned the Fund to
participate in any material bond rally while maintaining a defensive posture
with high quality, premium coupon bonds concentrated in particular states so
that investors can take advantage of their double tax-exempt status.
BOSTON 1784 TAX-EXEMPT MEDIUM-TERM INCOME FUND
Comparison of Change in the Value of a $10,000 Investment
in Boston 1784 Tax-Exempt Medium-Term Income Fund versus the
Lehman 7-Year Municipal Bond Index and the
Lipper Intermediate Municipal Debt Funds Average
[GRAPHIC OMITTED]
In the printed version of the document, a line graph
appears which depicts the following plot points:
Annualized Annualized Annualized
One-Year 3 Year 5 Year Inception to
Return Return Return Date
-------- ----------- ---------- ------------
4.24% 7.05% 6.59% 6.18%
<TABLE>
<CAPTION>
Initial
Investment
Date
6/30/93 May 94 May 95 May 96 May 97 May 98 May 99
------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Boston 1784 Tax-Exempt Medium-Term Income Fund $10,000 $10,212 $10,986 $11,449 $12,336 $13,474 $14,047
Lehman Brothers 7-Year Municipal Bond Index $10,000 $10,144 $10,972 $11,481 $12,267 $13,257 $13,884
Lipper Intermediate Municipal Debt Funds Average $10,000 $10,150 $10,874 $11,314 $12,037 $12,939 $13,420
</TABLE>
Past performance of the Fund is not predictive of future performance
* Inception date 6/14/93
17
<PAGE>
- --------------------------------------------------------------------------------
BOSTON 1784 CONNECTICUT TAX-EXEMPT INCOME FUND
Objective: To provide investors with current income exempt from both federal and
Connecticut personal income tax, with a secondary goal of preserving capital.
Boston 1784 Connecticut Tax-Exempt Income Fund is an actively managed,
state-specific portfolio of high quality, intermediate-term municipal securities
selected for their potential to achieve maximum tax-free income, a competitive
rate of return and preservation of capital. The Fund strives to increase yield
and maintain price stability by emphasizing diversification across sectors and
issuers in the State of Connecticut, and by trying to maximize tax-free income,
credit quality and market liquidity. On May 31, 1999, the Fund's net assets
totaled $187.7 million compared with $142.1 million on May 31, 1998. Of the
Fund's total assets, 47.0% were rated AAA, 36.4% were rated AA and 16.6% were
rated A by either Standard & Poor's or Moody's.
The Fund's total return for the year ended May 31, 1999 was 3.72%, compared
with a return of 3.41% for the Lipper Other States Intermediate Municipal Debt
Funds Average and 4.73% for the Lehman 7-Year Municipal Bond Index for the same
period. The Fund's return reflects a waiver of certain management fees and
expenses (see Financial Highlights).
The Fund outperformed its Lipper benchmark due to a focus on credit
quality, premium coupon yields, and a slightly longer average-weighted-maturity
and duration. The Fund lagged the total return of the Lehman 7-year Municipal
Bond Index by 1%, primarily due to the Fund's maturity structure and duration,
which adversely affected the Fund's total return during the last two months of
the year ended May 31, 1999.
Municipal bond yields rose from .15% to .5% across all maturities after
declining to historical lows in October 1998. In contrast, Treasury yields rose
from .82% to 1.7% during the same time period. Therefore, we believe that
municipal bonds are currently priced well below their fair market values. We
feel also that continued productivity gains, worldwide manufacturing
overcapacity and deflationary pressures, and an anticipated slowdown in personal
consumption and domestic economic growth will contain inflation and drive
interest rates back toward 5% on the 30-year U.S. Treasury Bond. Accordingly, we
have positioned the Fund to participate in any significant bond rally, while
maintaining a defensive posture with high quality, premium coupon bonds.
BOSTON 1784 CONNECTICUT TAX-EXEMPT INCOME FUND
Comparison of Change in the Value of a $10,000 Investment
in Boston 1784 Connecticut Tax-Exempt Income Fund versus the
Lehman 7-Year Municipal Bond Index and the
Lipper Other States Intermediate Municipal Debt Funds Average
[GRAPHIC OMITTED]
In the printed version of the document, a line graph
appears which depicts the following plot points:
Annualized Annualized
One-Year 3 Year Inception to
Return Return Date*
-------- ----------- ------------
3.72% 6.73% 6.57%
<TABLE>
<CAPTION>
Initial
Investment
Date
8/31/94 May 95 May 96 May 97 May 98 May 99
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Boston 1784 Connecticut Tax-Exempt Income Fund $10,000 $10,664 $11,103 $11,909 $13,015 $13,499
Lehman 7-Year Municipal Bond Index $10,000 $10,629 $11,123 $11,885 $12,844 $13,451
Lipper Other States Intmdt. Muni Debt Funds Average $10,000 $10,539 $10,924 $11,579 $12,387 $12,810
</TABLE>
Past performance of the Fund is not predictive of future performance
* Inception date 8/1/94
18
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
BOSTON 1784 FLORIDA TAX-EXEMPT INCOME FUND
Objective: To provide investors with current income exempt from federal income
tax through Fund shares which are exempt from Florida intangible personal
property tax, with a secondary goal of preserving capital.
Boston 1784 Florida Tax-Exempt Income Fund is an actively managed,
state-specific portfolio of primarily investment-grade, intermediate- to
longer-term securities. The Fund consists of a balance of prerefunded bonds,
intermediate bonds and longer-term securities. The majority of the Fund's assets
are invested in general obligation bonds issued by the State of Florida and
various municipalities, and revenue bonds issued to finance hospitals,
education, housing, transportation, utilities and industrial development. As of
May 31, 1999, 100% of the bonds in the Fund's portfolio were rated AA or higher
by either Moody's or Standard & Poor's. A portion of these assets were enhanced
with bond insurance.
The Fund's net assets increased from $51.8 million on May 31, 1998 to $68.8
million on May 31, 1999. For the twelve months ended May 31, 1999, the Fund had
a total return of 3.88%, compared with returns of 4.73% for the Lehman 7-Year
Municipal Bond Index and 3.45% for the Lipper Florida Intermediate Municipal
Debt Funds Average. As a result, the Fund ranked in the top 20% of its Lipper
peer group (3 of 15). The Fund's return and resulting ranking reflect a waiver
of certain management fees and expenses (see Financial Highlights).
Important factors that positively affected the Fund's performance during
the past fiscal year included the investment in high quality bonds. The Fund had
an average-weighted-maturity of 8.13 years and a duration of 6.37 years, both of
which were longer than the Lehman 7-Year Municipal Bond Index.
During the year ended May 31, 1999, the Fund focused on improving current
dividend yield while maintaining holdings with relatively high credit quality.
The Fund also increased its diversification by adding bonds of several new
issuers. Current income will continue to be a priority. In the coming months, we
expect to see a reduced supply of new municipal issues. We anticipate that bonds
will move within a narrow trading range and interest rates will eventually
decrease as economic growth slows and fears of inflation diminish.
BOSTON 1784 FLORIDA TAX-EXEMPT INCOME FUND
Comparison of Change in the Value of a $10,000 Investment
in Boston 1784 Florida Tax-Exempt Income Fund versus the
Lehman 7-Year Municipal Bond Index and the
Lipper Florida Intermediate Municipal Debt Funds Average
[GRAPHIC OMITTED]
In the printed version of the document, a line graph
appears which depicts the following plot points:
Annualized
One-Year Inception to
Return Date*
-------- ------------
3.88% 5.97%
<TABLE>
<CAPTION>
Initial
Investment
Date
6/30/97 May 98 May 99
------- ------- -------
<S> <C> <C> <C>
Boston 1784 Florida Tax-Exempt Income Fund $10,000 $10,759 $11,176
Lehman 7-Year Municipal Bond Index $10,000 $10,704 $11,211
Lipper Florida Intermediate Muni Debt Funds Average $10,000 $10,617 $10,983
</TABLE>
Past performance of the Fund is not predictive of future performance
* Inception date 6/30/97
19
<PAGE>
- --------------------------------------------------------------------------------
BOSTON 1784 MASSACHUSETTS TAX-EXEMPT INCOME FUND
Objective: To provide investors with current income, exempt from both federal
and Massachusetts personal income tax, consistent with preservation of capital.
Boston 1784 Massachusetts Tax-Exempt Income Fund is an actively managed,
state-specific portfolio of primarily investment-grade, intermediate- to
longer-term securities. The Fund consists of a balance of prerefunded bonds,
intermediate bonds and longer-term securities. The majority of the Fund's assets
are invested in general obligation bonds issued by the Commonwealth of
Massachusetts and various municipalities, and revenue bonds issued to finance
hospitals, education, housing, transportation, utilities and industrial
development. As of May 31, 1999, approximately 89.9% of the bonds in the Fund
were rated AA or higher by either Moody's or Standard & Poor's. A portion of
these assets were enhanced with bond insurance. On May 31, 1999, the Fund's
assets totaled $267.9 million compared with $206.1 million on May 31, 1998.
For the twelve months ended May 31, 1999, the Fund had a total return of
4.10%, compared with returns of 4.73% for the Lehman 7-Year Municipal Bond Index
and 3.35% for the Lipper Massachusetts Intermediate Municipal Funds Average. As
a result, the Fund ranked at the top of its Lipper peer group (1 of 10). The
Fund's return and resulting ranking reflect a waiver of certain management fees
and expenses (see Financial Highlights).
Several factors that positively affected the Fund's performance during the
past fiscal year included the investment in high quality bonds with current and
slight discount coupons. The Fund had an average-weighted-maturity of 8.66 years
and a duration of 6.55 years, both of which were longer than the Lehman 7-Year
Municipal Bond Index.
During the year ended May 31, 1999, the Fund focused on improving current
dividend yield while maintaining holdings with relatively high credit quality.
The Fund also attempted to increase diversification by adding bonds of new
issuers to its portfolio. Generating current income will continue to be a
priority. We expect to see a reduced supply of new municipal issues in the
coming months. We also expect bonds to move within a narrow trading range and
interest rates to eventually decline as economic growth slows and fears of
inflation diminish.
BOSTON 1784 MASSACHUSETTS TAX-EXEMPT INCOME FUND
Comparison of Change in the Value of a $10,000 Investment
in Boston 1784 Massachusetts Tax-Exempt Income Fund versus the
Lehman 7-Year Municipal Bond Index and the
Lipper Massachusetts Intermediate Municipal Funds Average
[GRAPHIC OMITTED]
In the printed version of the document, a line graph
appears which depicts the following plot points:
Annualized Annualized Annualized
One-Year 3 Year 5 Year Inception to
Return Return Return Date*
-------- ----------- ----------- ------------
4.10% 6.75% 5.96% 5.50%
<TABLE>
<CAPTION>
Initial
Investment
Date
6/30/93 May 94 May 95 May 96 May 97 May 98 May 99
------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Boston 1784 Massachusetts Tax-Exempt Income Fund $10,000 $10,126 $10,734 $11,116 $11,928 $12,990 $13,523
Lehman 7-Year Municipal Bond Index $10,000 $10,144 $10,972 $11,481 $12,267 $13,257 $13,884
Lipper Massachusetts Intermediate Municipal Average $10,000 $10,142 $10,766 $11,154 $11,824 $12,666 $13,088
</TABLE>
Past performance of the Fund is not predictive of future performance
* Inception date 6/14/93
20
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
BOSTON 1784 RHODE ISLAND TAX-EXEMPT INCOME FUND
Objective: To provide investors with current income exempt from federal income
tax and Rhode Island personal income and business corporation taxes, with a
secondary goal of preserving capital.
Boston 1784 Rhode Island Tax-Exempt Income Fund is an actively managed,
state-specific portfolio of high quality, intermediate-term municipal
securities. To increase yield and maintain price stability, the Fund emphasizes
diversification across sectors and issuers in the State of Rhode Island. The
Fund also attempts to maximize tax-free income, credit quality and market
liquidity. On May 31, 1999, the Fund's net assets totaled $102.1 million
compared with $76.8 million on May 31,1998. Of the Fund's total assets, 60% were
rated AAA, 20.8% were rated AA and 13% were rated A by either Standard & Poor's
or Moody's.
The Fund's total return for the year ended May 31, 1999 was 4.11%, compared
with a return of 3.41% for the Lipper Other States Intermediate Municipal Debt
Funds Average for the same period, ranking the Fund in the top 5% (4 of 80) of
its Lipper peer group. For the same twelve month period, the Lehman 7-Year
Municipal Bond Index's total return was 4.73%. The Fund's return and resulting
ranking reflect a waiver of certain management fees and expenses (see Financial
Highlights).
The Fund outperformed the Lipper Other States Intermediate Municipal Debt
Funds Average due to a focus on credit quality, premium coupon yields, and
slightly longer average-weighted-maturity and duration. The modest .62% total
return performance lag to the Lehman 7-Year Municipal Bond Index primarily
reflected the Fund's maturity structure and duration, which negatively impacted
the Fund's performance during the last two months of the year ended May 31,
1999.
After declining to historical lows in early October 1998, municipal bond
yields rose from .15% to .5% across all maturities in the following months. By
comparison, however, Treasury yields rose from .82% to 1.7% during the same time
period. Therefore, we believe that municipal bonds are currently priced below
their fair market values. We also believe that manufacturing overcapacity and an
anticipated slowdown in domestic economic growth will contain inflation and
drive interest rates back toward 5% on the 30-year U.S. Treasury Bond. We have
positioned the Fund to take advantage of a rise in bond prices, but will
maintain a defensive posture with high quality, premium coupon bonds.
BOSTON 1784 RHODE ISLAND TAX-EXEMPT INCOME FUND
Comparison of Change in the Value of a $10,000 Investment
in Boston 1784 Rhode Island Tax-Exempt Income Fund versus the
Lehman 7-Year Municipal Bond Index and the
Lipper Other States Intermediate Municipal Debt Funds Average
[GRAPHIC OMITTED]
In the printed version of the document, a line graph
appears which depicts the following plot points:
Annualized Annualized
One-Year 3 Year Inception to
Return Return Date*
-------- ----------- ------------
4.11% 6.65% 6.34%
<TABLE>
<CAPTION>
Initial
Investment
Date
8/31/94 May 95 May 96 May 97 May 98 May 99
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Boston 1784 Rhode Island Tax-Exempt Income Fund $10,000 $10,552 $11,033 $11,872 $12,855 $13,384
Lehman 7-Year Municipal Bond Index $10,000 $10,629 $11,123 $11,885 $12,844 $13,451
Lipper Other States Intmdt. Muni Debt Funds Average $10,000 $10,539 $10,924 $11,579 $12,387 $12,810
</TABLE>
<TABLE>
<CAPTION>
Initial
Investment
Date
8/31/94 May 95 May 96 May 97 May 98 May 99
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Boston 1784 Connecticut Tax-Exempt Income Fund $10,000 $10,664 $11,103 $11,909 $13,015 $13,499
Lehman 7-Year Municipal Bond Index $10,000 $10,629 $11,123 $11,885 $12,844 $13,451
Lipper Other States Intmdt. Muni Debt Funds Average $10,000 $10,539 $10,924 $11,579 $12,387 $12,810
</TABLE>
Past performance of the Fund is not predictive of future performance
* Inception date 8/1/94
21
<PAGE>
- --------------------------------------------------------------------------------
BOSTON 1784 ASSET ALLOCATION FUND
Objective: To provide investors with a favorable total rate of return through
current income and capital appreciation consistent with preservation of capital,
derived from investing in fixed income and equity securities.
Boston 1784 Asset Allocation Fund was allocated approximately 54% to common
stocks, 40% to bonds and 6% to money market instruments on May 31, 1999.
During the twelve months ended May 31, 1999, the Fund's net assets
increased from $50.3 million to $53.4 million. For the year ended May 31, 1999,
the Fund had a total return of 5.92%, compared with returns of 21.05% for the
Standard and Poor's 500 Composite Index (the "S&P 500"), 4.34% for the Lehman
Aggregate Bond Index and 8.71% for the Lipper Balanced Funds Average for the
same period. The Fund's return reflects a waiver of certain management fees and
expenses (see Financial Highlights).
The Fund's concentration of common stocks in the telecommunications
services and cable/media sectors was higher than the S&P 500 during much of the
fiscal year ended May 31, 1999, which positively affected the Fund's
performance. These sectors were beneficiaries of consumer spending,
consolidation and financial restructuring. Recently, the Fund added investments
in more economically sensitive sectors. Still, we believe the strength in these
cyclical sectors will be measured in months, not years, and we will watch
closely for signs of weakness. Foreign exposure will also remain primarily
limited to the developed markets.
The Fund's fixed income portfolio performed well in comparison to the
Lehman Aggregate Bond Index. Consisting of investment-grade, intermediate- to
long-term securities, the performance of the Fund's fixed income portfolio can
be attributed in part to a slightly longer duration than the Lehman Aggregate
Bond Index--an advantage in a period of declining interest rates. The Fund also
benefited from an underweighting in mortgaged-backed securities, many of which
were prepaid in the past year. The Fund's average credit quality improved
recently with an increase in U.S. Treasury securities holdings. On May 31, 1999,
the average-weighted-maturity of the Fund's fixed income portfolio was
approximately 7.9 years with a duration of approximately 5.2 years.
BOSTON 1784 ASSET ALLOCATION FUND
Comparison of Change in the Value of a $10,000 Investment
in Boston 1784 Asset Allocation Fund versus the
S&P 500 Composite Index, the Lehman Aggregate Bond Index
and the Lipper Balanced Funds Average
[GRAPHIC OMITTED]
In the printed version of the document, a line graph
appears which depicts the following plot points:
Annualized Annualized Annualized
One-Year 3 Year 5 Year Inception to
Return Return Return Date
-------- ----------- ---------- ------------
5.92% 13.61% 14.69% 12.15%
<TABLE>
<CAPTION>
Initial
Investment
Date
6/30/93 May 94 May 95 May 96 May 97 May 98 May 99
------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Boston 1784 Asset Allocation Fund $10,000 $10,016 $11,503 $13,554 $15,572 $18,765 $19,876
S&P 500 Composite Index $10,000 $10,395 $12,489 $16,039 $20,754 $27,119 $32,828
Lehman Aggregate Bond Index $10,000 $ 9,890 $11,028 $11,511 $12,469 $13,830 $14,430
Lipper Balanced Funds Average $10,000 $10,223 $11,471 $13,503 $15,715 $18,764 $20,398
</TABLE>
Past performance of the Fund is not predictive of future performance
* Inception date 6/14/93
22
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
BOSTON 1784 GROWTH AND INCOME FUND
Objective: To provide investors with long-term growth of capital with a
secondary goal of income.
Boston 1784 Growth and Income Fund is a diversified portfolio invested primarily
in stocks of large- and mid-capitalization companies. While the Fund invests
largely in U.S. companies, as of May 31, 1999, 12.27% of the Fund's assets were
invested in international equities. During the year ended May 31, 1999, the
Fund's net assets decreased to $549.4 million from $554.0 million on May 31,
1998.
For the year ended May 31, 1999, the Fund had a total return of 4.65%,
compared with returns of 21.05% for the Standard & Poor's 500 Composite Index
(the "S&P 500") and 11.48% for the Lipper Growth & Income Funds Average for
the same period. The Fund's return reflects a waiver of certain management fees
and expenses (see Financial Highlights.)
The Fund's performance closely mirrored or exceeded its benchmarks for much
of 1998. Early in the Fund's fiscal year, an overweighting in technology stocks,
primarily in Microsoft, Cisco and Intel, compared with the S&P 500 resulted in
returns that exceeded the S&P 500. In August and September 1998, however, the
Russian debt crisis, the near-failure of a large hedge fund and the sharp
decline in the price of oil drove markets lower. Technology stocks, energy
stocks and foreign holdings in particular were negatively impacted, and the Fund
lagged the S&P 500 due to overweightings in these areas. In October 1998, when
technology and growth stocks rebounded sharply, the Fund again outperformed the
S&P 500. At the beginning of 1999, oil prices also rebounded and the Fund's
overweighted position in this sector positively affected performance. The Fund's
foreign holdings, particularly J.D. Wetherspoon and PizzaExpress, also performed
strongly and boosted returns. At the same time, the Fund's performance was
negatively affected by a market sector shift to cyclical stocks. This shift
depressed the prices of growth stocks, especially in the drug and technology
sectors where the Fund was overweighted.
We believe the market's cyclical emphasis will be temporary and that we
will see a rebound in growth stocks as inflation fears abate and the interest
rate environment becomes more favorable. In the coming year, the Fund will
primarily focus on companies exhibiting growth rates of 20% or more.
BOSTON 1784 GROWTH AND INCOME FUND
Comparison of Change in the Value of a $10,000 Investment
in Boston 1784 Growth and Income Fund versus the S&P 500
Composite Index and the Lipper Growth & Income Funds Average
[GRAPHIC OMITTED]
In the printed version of the document, a line graph
appears which depicts the following plot points:
Annualized Annualized Annualized
One-Year 3 Year 5 Year Inception to
Return Return Return Date*
-------- ----------- ----------- ------------
4.65% 16.20% 18.34% 16.38%
<TABLE>
<CAPTION>
Initial
Investment
Date
6/30/93 May 94 May 95 May 96 May 97 May 98 May 99
------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Boston 1784 Growth and Income Fund $10,000 $10,854 $12,709 $16,054 $18,997 $24,070 $25,190
S&P 500 Composite Index $10,000 $10,395 $12,489 $16,039 $20,754 $27,119 $32,828
Lipper Growth & Income Average $10,000 $10,475 $12,011 $15,113 $18,621 $23,381 $26,065
</TABLE>
Past performance of the Fund is not predictive of future performance
* Inception date 6/7/93
23
<PAGE>
- --------------------------------------------------------------------------------
BOSTON 1784 GROWTH FUND
Objective: To provide investors with capital appreciation. Dividend income, if
any, is incidental to this goal.
Boston 1784 Growth Fund is a diversified portfolio invested primarily in stocks
of small- and mid-capitalization companies. During the past twelve months, the
Fund's net assets decreased to $185.5 million from $257.6 million on May 31,
1998.
For the year ended May 31, 1999, the Fund had a total return of -3.54%,
compared with returns of -2.69% for the Russell 2000 Index, 9.74% for the Lipper
Mid-Cap Funds Average and 16.21% for the Lipper Growth Funds Average for the
same period. Prior to the past fiscal year, the Fund used the Lipper Growth
Funds Average as a benchmark, which is heavily weighted toward
large-capitalization companies. The Lipper Mid-Cap Funds Average more closely
mirrors the composition of the Fund. The Fund's return reflects a waiver of
certain management fees and expenses (see Financial Highlights.)
The Fund's performance, compared to its benchmarks, varied during the
fiscal year ended May 31, 1999. While its significant overweighting in
technology stocks proved beneficial during June and July 1998, technology and
energy shares fell sharply in August. During that decline, small-cap stocks
suffered a more severe downturn than large-cap stocks. After rebounding slightly
in September 1998, the market and the value of the Fund's portfolio fell sharply
as fears of a credit crunch developed. An easing by the Federal Reserve Board in
late September had little impact, but a second easing in mid-October sparked a
significant rally. The Fund gained 49.24% between the stock market low in
October 1998 and January 1, 1999, outperforming its benchmarks by a wide margin.
The Fund dramatically reduced its holdings in the energy sector during this
period and focused increasingly on technology companies, particularly those in
the storage area networking (SAN) and fiber channel areas, such as Emulex and
QLogic. The Fund also bolstered its position in consumer cyclical companies,
such as Danaher and Fastenal. Early in 1999, however, large-cap companies
reemerged as market leaders, ending the rally in smaller companies. Weakness in
the software sector also impeded the Fund's performance. In May 1999, the Fund
performed strongly due to a rebound in foreign stocks and good results in the
SAN area.
In the year ahead, we expect improvements in the software industry, as well
as continued gains in the SAN and fiber channel industries, which represent 18%
of the Fund. The Fund will primarily maintain its focus on companies
demonstrating growth rates of 30% or higher.
[GRAPHIC OMITTED]
In the printed version of the document, a line graph
appears which depicts the following plot points:
Annualized Annualized
One-Year 5 Year Inception to
Return Return Date
-------- ---------- ------------
-3.54% 5.73% 9.45%
<TABLE>
<CAPTION>
Initial
Investment
Date
3/31/96 May 96 May 97 May 98 May 99
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Boston 1784 Growth Fund $10,000 $11,270 $12,258 $13,807 $13,319
Russell 2000 Index $10,000 $10,950 $11,713 $14,201 $13,819
Lipper Mid-Cap Funds Average $10,000 $10,847 $11,788 $14,586 $16,007
</TABLE>
24
<PAGE>
- --------------------------------------------------------------------------------
BOSTON 1784 INTERNATIONAL EQUITY FUND
Objective: To provide investors with long-term growth of capital. Dividend
income, if any, is incidental to this goal.
Boston 1784 International Equity Fund was invested in 23 countries with
positions in about 90 companies as of May 31, 1999. In addition, 81.7% of the
Fund was invested in the established markets included in the Morgan Stanley MSCI
EAFE Index. The emerging market positions amounted to about 6% of the Fund's
assets. Since May 31, 1998, the Fund's net assets have declined from $469.8
million to $389.8 million on May 31, 1999.
For the year ended May 31, 1999, the Fund had a total return of -4.85%,
compared to returns of 4.36% for the Morgan Stanley MSCI EAFE Index and -1.23%
for the Lipper International Funds Average for the same period. The Fund's
return reflects a waiver of certain management fees and expenses (see Financial
Highlights).
International equity markets recorded strong gains during the early months
of the Fund's fiscal year ended May 31, 1999, as investors believed the Asian
financial crisis, which started in Thailand one year earlier, was over. Europe
was also judged to be moving smoothly towards the launch of the Euro on January
1, 1999. However, high share valuations were severely tested by a prospective
currency crisis in Brazil and the international markets were increasingly
influenced by the volatile U.S. equity market. When U.S. stocks plunged 19% by
the end of August 1998, major international markets fell by comparable amounts
and adversely affected the Fund's performance. Just as quickly sentiment changed
and, with the help of a series of interest rate cuts in every major economy, the
international markets followed Wall Street to record a strong 1998 year-end
performance.
The focus on Eurozone equities faded in early 1999, when the strength of
the U.S. economy and shares attracted funds from other markets. This negatively
impacted the Fund. Then in March 1999, foreign investors, anxious to correct
underweighted portfolio positions, rewarded early signs of corporate
restructuring and an economic recovery in Japan. During the past six months, the
Fund increased its Japanese exposure from 10% to 20% and slightly increased
positions in other Pacific Basin countries to take advantage of the recovery.
Eurozone positions have been reduced accordingly.
Since the beginning of 1999, "value" stocks have generally outperformed
"growth" stocks. However, we expect corporate profits to rise and restore the
competitive attraction of the international equity markets. We will therefore
continue to emphasize the longer-term growth prospects for each company in the
Fund's portfolio.
BOSTON 1784 INTERNATIONAL EQUITY FUND
Comparison of Change in the Value of a $10,000 Investment
in Boston 1784 International Equity Fund versus the
Morgan Stanley MSCI EAFE Index and the
Lipper International Funds Average
[GRAPHIC OMITTED]
In the printed version of the document, a line graph
appears which depicts the following plot points:
Annualized Annualized
One-Year 3 Year Inception to
Return Return Date
-------- ----------- ------------
-4.85% 3.88% 7.74%
<TABLE>
<CAPTION>
Initial
Investment
Date
1/31/95 May 95 May 96 May 97 May 98 May 99
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Boston 1784 International Equity Fund $10,000 $11,040 $13,146 $14,583 $15,486 $14,735
Morgan Stanley EAFE Index $10,000 $10,862 $12,021 $12,928 $14,365 $14,991
Lipper International Funds Average $10,000 $10,774 $12,394 $13,918 $15,938 $15,742
</TABLE>
Past performance of the Fund is not predictive of future performance
* Inception date 1/3/95
25
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Tax-Free Money Market Fund
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
In the printed version of the document, a line graph appears which depicts the
following plot points:
Transportation Bonds 2%
Education Bonds 7%
Public Facility Bonds 3%
Health Care Bonds 10%
Alternative Minimum Tax Bonds 1%
Industrial Development & Pollution Control Bonds 13%
Bond Anticipation Notes 1%
Water & Sewer Bonds 7%
Housing Bonds 6%
Other Revenue Bonds 10%
Tax-Exempt Commercial Paper 3%
Cash Equivalents 18%
General Obligation Bonds 4%
Utility Bonds 15%
% of Total Portfolio Investments
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Municipal Bonds -- 81.2%
Alaska -- 1.0%
Valdez, Arco Transportation
Project RB, Series 1994-A
2.700%, 06/14/99 $ 9,500 $ 9,500
-------
Arizona -- 2.0%
Pima County, Industrial
Development Authority RB (A)
3.400%, 06/02/99 19,000 19,000
-------
California -- 2.8%
California School Cash Reserve
Program Authority TRAN,
Series A, AMBAC
4.500%, 07/02/99 15,000 15,009
California Student Education
Loan Marketing RB,
Series A LOC (A)
3.000%, 06/01/99 12,500 12,500
-------
27,509
-------
Colorado -- 2.4%
Colorado State Health Facility
Authority RB, LOC (A)
3.300%, 06/02/99 23,100 23,100
-------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Delaware -- 2.0%
Delaware State Health Facility
Authority RB, LOC (A)
3.250%, 06/02/99 $19,900 $19,900
-------
District of Columbia -- 2.1%
District of Columbia Tax &
Revenue GO, Series B
3.750%, 09/30/99 20,000 20,042
-------
Florida -- 3.1%
Miami-Dade County School
Board COP, Series C, FSA
4.000%, 08/01/99 4,360 4,367
Miami-Dade County Water &
Sewer System RB, Series 1994,
FGIC (A)
3.150%, 06/02/99 25,600 25,600
-------
29,967
-------
Georgia -- 8.7%
Burke County, Pollution
Control RB, Oglethorpe Power,
Series A, FGIC (A)
3.150%, 06/02/99 13,750 13,750
Burke County, Pollution Control
Development, Series 2 (A)
3.400%, 06/01/99 20,000 20,000
Georgia State Municipal Electric
Authority RB, LOC (A)
3.200%, 06/02/99 21,800 21,800
Georgia State Municipal Electric
Authority RB, Series B,
LOC (A) (B)
3.200%, 06/02/99 7,000 7,000
Georgia State Municipal Gas
Authority RB, Gas Portfolio II
Project, Series B (A)
3.150%, 06/02/99 9,375 9,375
Southern Georgia Hospital
Authority RB, Series A (A)
3.350%, 06/02/99 12,900 12,900
-------
84,825
-------
26
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Illinois -- 9.1%
Chicago GO, LOC (B)
2.850%, 01/31/00 $ 7,500 $ 7,500
Chicago, Multi-Family
Housing RB, Waveland
Associates Project C,
LOC (A) (B)
3.300%, 06/02/99 10,000 10,000
Illinois State Development
Finance Authority RB,
Chicago Symphony
Project, GOA (A)
3.200%, 06/02/99 26,000 26,000
Illinois State Development
Finance Authority RB,
Series 42A (A)
3.470%, 06/03/99 14,030 14,030
Illinois State Educational
Facility Authority RB,
Shedd Aquarium Society
Project, Series B,
LOC (A) (B)
3.700%, 07/20/99 6,000 6,000
Illinois State Toll Highway
Authority RB (A)
3.250%, 06/02/99 25,000 25,000
-------
88,530
-------
Indiana -- 0.5%
Indiana State Educational
Loan RB, Series E
4.200%, 06/01/00 4,400 4,438
-------
Iowa -- 1.6%
Polk County, Catholic Health
Center RB, Series B (A)
3.250%, 06/02/99 15,300 15,300
-------
Kentucky -- 3.0%
Boone County, Pollution Control
RB, Cincinnati Gas & Electric
Project, LOC (A) (B)
3.800%, 06/01/99 4,100 4,100
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Kentucky Rural Water Finance
RB, Public Project
Construction Notes
4.000%, 07/15/99 $25,080 $25,089
-------
29,189
-------
Louisiana -- 6.9%
De Soto Parish, Pollution
Control RB, Central Louisiana
Electric Company Project,
Series B, LOC (A)
3.200%, 06/02/99 10,000 10,000
Louisiana State Public Facilities
Authority RB, Willis Knighton
Medical Center, LOC (A) (B)
3.400%, 06/02/99 37,000 37,000
Plaquemines, Port Facilities RB,
International Marine Terminal
Project, Series B (A) (B)
3.050%, 03/15/00 10,900 10,900
Rapides Parish, Pollution
Control RB, Central Louisiana
Electric Company Project,
LOC (A) (B)
3.200%, 06/02/99 9,250 9,250
-------
67,150
-------
Maine -- 1.0%
Jay, Pollution Control RB,
Solid Waste Disposal Project,
AMT (A) (B)
4.000%, 06/01/99 10,000 10,000
-------
Massachusetts -- 3.2%
Massachusetts State GO
4.000%, 05/01/00 8,080 8,138
Massachusetts State Housing
Finance Authority RB,
Multi-Family Series A,
GNMA (A)
3.150%, 06/02/99 11,100 11,100
27
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Tax-Free Money Market Fund (continued)
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Massachusetts (continued)
Springfield, Massachusetts BAN
4.000%, 07/15/99 $10,000 $10,004
4.000%, 09/02/99 2,000 2,002
-------
31,244
-------
Michigan -- 1.3%
Kent, Hospital Finance
Authority RB, Spectrum
Health Series B, MBIA (A)
3.150%, 06/02/99 12,200 12,200
-------
Mississippi -- 1.6%
Jackson County RB, Chevron
USA Project, Series 93 (A)
3.400%, 06/01/99 11,600 11,600
Mississippi State GO
5.000%, 11/01/99 3,925 3,954
-------
15,554
-------
Missouri -- 0.9%
Missouri State Health &
Educational Facilities
Authority RB, Christian
Health Services,
Series B, LOC (A) (B)
3.200%, 06/02/99 6,150 6,150
Missouri State Higher Education
Loan Authority RB, Series CC
3.200%, 02/15/00 2,715 2,715
-------
8,865
-------
Nebraska -- 1.0%
Nebraska State Public Gas
Supply RB, Series C
3.550%, 03/01/00 3,195 3,202
Omaha, Electric Power
Distribution RB, Series A
4.850%, 02/01/00 6,245 6,314
-------
9,516
-------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
New Hampshire -- 2.9%
New Hampshire State Health &
Higher Education Facilities
Authority RB, Mary
Hitchcock Project,
Series 85D, FGIC (A) (B)
3.200%, 06/02/99 $12,600 $12,600
New Hampshire State
Health & Higher Education
Facilities Authority RB,
Mary Hitchcock Project,
Series 85H,
FGIC (A) (B)
3.200%, 06/02/99 9,600 9,600
New Hampshire State
Health & Higher Education
Facilities Authority RB,
Veterans Administration
Hospital, New England
Project, Series C,
AMBAC (A) (B)
3.350%, 06/02/99 4,000 4,000
New Hampshire State
Health & Higher Education
Facilities Authority RB,
Veterans Administration
Hospital, New England
Project, Series F,
AMBAC (A) (B)
3.350%, 06/02/99 2,000 2,000
-------
28,200
-------
New York -- 2.5%
New York State Housing
Finance Agency RB,
Series PA 423 (A)
3.370%, 06/03/99 9,105 9,105
New York State Municipal Water
Finance Authority RB,
Series G, FGIC (A) (B)
3.300%, 06/01/99 15,000 15,000
-------
24,105
-------
28
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
North Carolina -- 2.1%
Wake County, Industrial
Facilities & Pollution
Control RB, Carolina
Power & Light Project,
Series B, LOC (A) (B)
3.250%, 06/02/99 $ 8,600 $ 8,600
Wake County, Industrial
Facilities & Pollution
Control RB, Carolina
Power & Light Project,
Series C, LOC (A) (B)
3.250%, 06/02/99 12,250 12,250
-------
20,850
-------
Oklahoma -- 2.4%
Oklahoma State Water Resources
RB, Saint Loan Program,
LOC (A) (B)
3.550%, 09/01/99 23,710 23,710
-------
Pennsylvania -- 4.7%
Quakertown, General
Authority RB, Series A, LOC (A)
3.450%, 06/01/99 11,300 11,300
Quakertown, Hospital Facilities
Authority RB (A) (B)
3.450%, 06/01/99 34,200 34,200
-------
45,500
-------
South Carolina -- 0.6%
Piedmont, Municipal Power
Agency RB, Series B, MBIA (A)
3.300%, 06/02/99 5,400 5,400
-------
Tennessee -- 0.3%
Nashville & Davidson County,
Education & Health
Facilities RB, Metropolitan
Government Vanderbilt
University Series 85-A,
GOI (A)
3.100%, 01/15/00 2,500 2,500
-------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Texas -- 4.6%
Bexar County, Multi-Family
Housing RB, Altamonte
Apartments Project, FNMA (A)
3.400%, 06/02/99 $11,300 $11,300
Brazos, Industrial
Development RB, Badische
Corporate Port Authority,
LOC (A) (B)
3.850%, 06/01/99 6,300 6,300
Midlothian, Industrial
Development RB (A)
3.300%, 06/02/99 12,000 12,000
Texas, Lower Colorado River
Authority RB, Junior Lien 3rd
Supply Series, MBIA (A)
3.150%, 06/02/99 15,200 15,200
-------
44,800
-------
Utah -- 2.3%
Utah Intermountain Power
TECP, Series 97B
3.100%, 06/09/99 22,100 22,100
-------
Vermont -- 0.8%
Vermont Education & Health
Financing Agency RB,
Middlebury College
Project A (A)
3.100%, 11/01/99 1,500 1,500
Vermont State Health &
Educational Facilities
Authority RB, Series D,
AMBAC (A) (B)
3.350%, 06/02/99 5,900 5,900
-------
7,400
-------
Washington -- 1.5%
Washington State Health Care
Facilities Authority RB, Sisters
of Providence Project,
Series C, LOC (A) (B)
3.300%, 06/01/99 12,100 12,100
29
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Tax-Free Money Market Fund (concluded)
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Washington (continued)
Washington State Public Power
Supply RB, Series A
5.300%, 07/01/99 $ 2,400 $ 2,404
--------
14,504
--------
West Virginia -- 1.4%
West Virginia State Hospital
Finance Authority RB,
Oak Hill Hospital Project,
Series A (A)
3.150%, 06/03/99 13,285 13,285
--------
Wisconsin -- 0.9%
Pleasant Prairie, Industrial
Development Authority RB,
Wisconsin Electric Power
Project, LOC (A) (B)
3.250%, 06/03/99 9,000 9,000
--------
Total Municipal Bonds
(Cost $787,183) 787,183
--------
Tax-Exempt Municipal
Trust Certificate -- 0.6%
Municipal Tax-Exempt Trust
Certificate Class A1, MBIA
3.100%, 02/07/00 5,256 5,256
Total Tax-Exempt Municipal
Trust Certificate
(Cost $5,256) 5,256
--------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Cash Equivalents -- 4.5%
Clipper Caraval Tax-Exempt
Trust, Series 1998-1,
Class A-1, AMBAC
3.250%, 01/06/00 $ 22,825 $ 22,825
Clipper Tax-Exempt Trust,
Series A (A) (B)
3.370%, 06/03/99 20,641 20,641
--------
Total Cash Equivalents
(Cost $43,466) 43,466
--------
Repurchase Agreements -- 13.5%
J.P. Morgan
4.810%, dated 05/28/99, matures
06/01/99, repurchase price
$30,016,033 (collateralized by
U.S. Treasury Instruments:
total market value
$30,600,033) (C) 30,000 30,000
Paine Webber
4.800%, dated 05/28/99, matures
06/01/99, repurchase price
$101,135,185 (collateralized
by U.S. Treasury Instruments:
total market value
$103,104,898) (C) 101,081 101,081
--------
Total Repurchase Agreements
(Cost $131,081) 131,081
--------
Total Investments -- 99.8%
(Cost $966,986) 966,986
--------
Other Assets and Liabilities, Net -- 0.2% 2,394
--------
30
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Description Value (000)
- --------------------------------------------------------------------------------
Net Assets:
Capital Shares (unlimited
authorization -- no par value)
based on 969,493,152 outstanding
shares of beneficial interest $ 969,493
Accumulated net realized loss
on investments (113)
---------
Total Net Assets -- 100.0% $ 969,380
=========
Net Asset Value, Offering and
Redemption Price Per Share $ 1.00
=========
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(A) Variable Rate Security. The rate reported on the Statement of Net Assets is
the rate in effect on May 31, 1999. The date shown is the next scheduled
reset date.
(B) Put, demand or pre-refund feature exists requiring the issuer to repurchase
the instrument prior to maturity. The date shown is the lesser of the put,
demand or pre-refund date.
(C) Tri-Party Repurchase Agreement
AMT--Alternative Minimum Tax
BAN--Bond Anticipation Note
COP--Certificate of Participation
GO--General Obligation Bond
LOC--Securities are held in connection with a letter of credit issued by a major
commercial bank or other financial institution.
RB--Revenue Bond
TECP--Tax Exempt Commercial Paper
TRAN--Tax and Revenue Anticipation Note
The following organizations have provided underlying credit support for the
securities as set forth in the Statement of Net Assets.
AMBAC--American Municipal Bond Assurance Corporation
FGIC--Financial Guaranty Insurance Corporation
FNMA--Federal National Mortgage Association
FSA--Financial Security Assurance
GNMA--Government National Mortgage Association
GOA--General Obligation of Authority
GOI--General Obligation of Institution
MBIA--Municipal Bond Insurance Association
The accompanying notes are an integral part of the financial statements.
31
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 U.S. Treasury Money Market Fund
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
In the printed version of the document, a line graph appears which depicts the
following plot points:
U.S. Treasury Obligations 18%
U.S. Government Agency Obligations 33%
Cash Equivalents 49%
% of Total Portfolio Investments
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
U.S. Treasury Obligations -- 18.9%
U.S. Treasury Bills (A)
4.774%, 06/15/99 $ 15,000 $ 14,972
4.390%, 07/22/99 5,000 4,969
4.481%, 08/05/99 5,000 4,961
4.544%, 08/19/99 5,000 4,951
4.566%, 10/28/99 5,000 4,908
U.S. Treasury Notes
6.000%, 06/30/99 5,000 5,006
5.875%, 07/31/99 5,000 5,007
5.875%, 08/31/99 5,000 5,016
5.750%, 09/30/99 5,000 5,018
7.125%, 09/30/99 5,000 5,041
5.625%, 11/30/99 2,500 2,510
5.375%, 01/31/00 2,500 2,510
5.500%, 03/31/00 9,000 9,051
--------
Total U.S. Treasury Obligations
(Cost $73,920) 73,920
--------
U.S. Government Agency Obligations -- 33.9%
Federal Farm Credit Bank MTN (B)
5.121%, 06/01/99 5,000 4,998
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Federal Home Loan Bank
5.000%, 12/29/99 $ 5,000 $ 5,000
5.100%, 03/09/00 5,000 4,999
Federal Home Loan Bank (B)
5.161%, 06/01/99 5,000 5,000
4.721%, 06/08/99 5,000 4,999
Federal Home Loan Mortgage
Corporation (A)
4.773%, 06/08/99 7,500 7,493
4.737%, 06/10/99 5,000 4,994
4.826%, 06/11/99 5,000 4,993
4.835%, 06/25/99 7,000 6,978
4.828%, 06/28/99 5,000 4,982
4.830%, 06/29/99 3,000 2,989
4.754%, 07/23/99 10,000 9,932
4.827%, 09/08/99 2,123 2,095
4.856%, 09/24/99 5,000 4,924
Federal National Mortgage
Association (A)
4.754%, 06/03/99 2,700 2,699
4.721%, 06/11/99 8,000 7,990
4.742%, 06/18/99 10,000 9,978
4.874%, 09/09/99 5,000 4,934
4.846%, 09/22/99 9,750 9,605
4.800%, 10/15/99 5,000 4,912
Student Loan Marketing
Association (B)
4.881%, 06/01/99 3,950 3,934
5.101%, 06/01/99 14,000 13,994
--------
Total U.S. Government
Agency Obligations
(Cost $132,422) 132,422
--------
Repurchase Agreements -- 50.9%
Dean Witter
4.790%, dated 05/28/99, matures
06/01/99, repurchase price
$45,023,950 (collateralized
by U.S. Treasury Instruments:
total market value
$45,900,045) (C) 45,000 45,000
32
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Repurchase Agreements (continued)
First Boston
4.750%, dated 05/28/99, matures
06/01/99, repurchase price
$15,007,917 (collateralized
by U.S. Treasury Bonds: total
market value
$15,299,976) (C) $ 15,000 $ 15,000
Greenwich Capital
4.800%, dated 05/28/99,
matures 06/01/99, repurchase
price $40,021,333 (collateralized
by U.S. Treasury Instruments:
total market value
$40,800,036) (C) 40,000 40,000
J.P. Morgan
4.810%, dated 05/28/99, matures
06/01/99, repurchase price
$54,087,573 (collateralized
by U.S. Treasury Instruments:
total market value
$55,139,916) (C) 54,059 54,059
Prudential Securities
4.800%, dated 05/28/99,
matures 06/01/99, repurchase
price $45,024,000 (collateralized
by U.S. Treasury Instruments:
total market value
$45,898,144) (C) 45,000 45,000
---------
Total Repurchase Agreements
(Cost $199,059) 199,059
---------
Total Investments -- 103.7%
(Cost $405,401) 405,401
---------
Other Assets and Liabilities,
Net -- (3.7%) (14,626)
---------
- --------------------------------------------------------------------------------
Description Value (000)
- --------------------------------------------------------------------------------
Net Assets:
Capital Shares (unlimited
authorization -- no par value)
based on 390,753,172 outstanding
shares of beneficial interest $ 390,753
Undistributed net investment income 14
Accumulated net realized gain
on investments 8
---------
Total Net Assets -- 100.0% $ 390,775
==========
Net Asset Value, Offering and
Redemption Price Per Share $ 1.00
==========
(A) The rate reported on the Statement of Net Assets is the effective yield as
of May 31, 1999.
(B) Variable Rate Security. The rate reported on the Statement of Net Assets is
the rate in effect on May 31, 1999. The date shown is the next scheduled
reset date.
(C) Tri-Party Repurchase Agreement
MTN--Medium Term Note
The accompanying notes are an integral part of the financial statements.
33
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Prime Money Market Fund
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
In the printed version of the document, a line graph appears which depicts the
following plot points:
Municipal Bonds 14%
Cash Equivalents 15%
Corporate Bonds 7%
U.S. Government Agency Obligations 8%
Commercial Paper 56%
% of Total Portfolio Investments
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Commercial Paper -- 56.3%
Automotive -- 3.0%
Ford Motor (A)
4.833%, 08/05/99 $ 5,000 $ 4,957
-------
Financial Services -- 35.6%
American Express Credit (A)
4.826%, 06/14/99 3,000 2,995
4.826%, 06/16/99 1,300 1,297
Barton Capital (A)
4.840%, 06/09/99 2,000 1,998
Caterpillar (A)
4.807%, 06/01/99 1,400 1,400
4.829%, 06/30/99 5,000 4,981
CIT Group (A)
4.903%, 06/01/99 5,000 5,000
Concord Minuteman Capital (A)
4.927%, 06/18/99 5,000 4,989
General Electric Capital (A)
4.817%, 06/10/99 3,000 2,996
4.863%, 07/28/99 2,373 2,355
J.P. Morgan (A)
4.940%, 06/07/99 4,000 3,997
4.907%, 06/07/99 2,000 1,998
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Lexington Parker (A)
4.932%, 10/07/99 $ 4,000 $ 3,931
Monte Rosa (A)
4.857%, 06/17/99 2,000 1,996
Old Line Funding (A)
4.870%, 06/18/99 2,832 2,826
Prudential Funding (A)
4.810%, 06/04/99 5,000 4,998
Sigma Financial (A)
4.927%, 06/10/99 2,000 1,998
Triple A-1 Funding (A)
4.943%, 06/02/99 4,000 3,999
Wood Street Funding (A)
4.889%, 06/04/99 5,000 4,998
-------
58,752
-------
Food, Beverage & Tobacco -- 3.0%
Anheuser Busch (A)
4.903%, 06/01/99 5,000 5,000
-------
Taxable Municipals -- 5.7%
Dekalb County, Georgia,
Emory University
4.950%, 06/03/99 4,200 4,200
New York City, New York
4.900%, 06/03/99 1,000 1,000
4.950%, 06/03/99 1,000 1,000
4.850%, 06/09/99 1,350 1,350
4.900%, 07/22/99 1,800 1,800
-------
9,350
-------
Petroleum Refining -- 3.0%
BP America (A)
4.923%, 06/01/99 5,000 5,000
-------
Telephones &
Telecommunications -- 3.0%
AT&T (A)
4.772%, 06/08/99 5,000 4,995
-------
34
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Utilities -- 3.0%
Lower Colorado River
Authority
4.900%, 06/02/99 $ 3,000 $ 3,000
4.950%, 06/03/99 2,000 2,000
-------
5,000
-------
Total Commercial Paper
(Cost $93,054) 93,054
-------
Corporate Bonds -- 6.8%
American General
7.700%, 10/15/99 1,150 1,161
AVCO Financial Services
7.250%, 07/15/99 2,000 2,005
Chase Manhattan Bank
5.875%, 08/04/99 500 500
CIT Group, MTN
6.800%, 04/17/00 2,000 2,025
Ford Motor Credit
6.375%, 09/15/99 500 502
6.375%, 04/15/00 750 757
IBM Credit
5.575%, 08/27/99 1,000 1,001
Norwest Financial
6.000%, 03/15/00 2,755 2,772
Texaco Capital
6.875%, 07/15/99 500 501
-------
Total Corporate Bonds
(Cost $11,224) 11,224
-------
U.S. Government Agency Obligations -- 7.6%
Federal Home Loan Bank
5.100%, 03/09/00 5,000 5,000
5.100%, 05/17/00 2,500 2,496
Federal National Mortgage
Association, MTN
5.000%, 05/04/00 5,000 4,994
-------
Total U.S. Government
Agency Obligations
(Cost $12,490) 12,490
-------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Taxable Municipal Bonds -- 14.0%
Barton Healthcare (B)
4.950%, 06/02/99 $ 900 $ 900
Catholic Health Initiatives (B)
4.900%, 06/02/99 1,000 1,000
Community Health System,
LOC (B)
5.050%, 06/02/99 900 900
Kit Carson County, Colorado,
Agricultural Development RB,
LOC (B)
5.150%, 06/02/99 2,000 2,000
Los Angeles, California,
Community Redevelopment
Agency RB, FSA (B)
4.950%, 06/02/99 5,000 5,000
Maryland State Health & Higher
Education RB, LOC (B)
5.200%, 06/03/99 4,100 4,100
Maryland State Health & Higher
Education Facilities RB,
Series B, LOC (B)
5.100%, 06/02/99 2,300 2,300
Olathe, Kansas, Industrial RB,
LOC (B)
4.900%, 06/03/99 4,000 4,000
Union County, Arkansas,
Industrial RB, LOC (B)
4.950%, 06/02/99 3,000 3,000
-------
Total Taxable Municipal Bonds
(Cost $23,200) 23,200
-------
Repurchase Agreement -- 14.8%
J.P. Morgan
4.810%, dated 05/28/99,
matures 06/01/99, repurchase
price $24,394,061 (collateralized
by U.S. Treasury Instruments:
total market value
$24,868,679) (C) 24,381 24,381
-------
Total Repurchase Agreement
(Cost $24,381) 24,381
-------
35
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Prime Money Market Fund (concluded)
- --------------------------------------------------------------------------------
Description Value (000)
- --------------------------------------------------------------------------------
Total Investments -- 99.5%
(Cost $164,349) $ 164,349
---------
Other Assets and Liabilities,
Net -- 0.5% 829
---------
Net Assets:
Capital Shares (unlimited
authorization -- no par value)
based on 165,183,547 outstanding
shares of beneficial interest 165,167
Undistributed net investment income 35
Accumulated net realized loss
on investments (24)
---------
Total Net Assets -- 100.0% $ 165,178
=========
Net Asset Value, Offering and
Redemption Price Per Share $ 1.00
=========
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(A) The rate reported on the Statement of Net Assets is the effective yield as
of May 31,1999.
(B) Variable Rate Security. The rate reported on the Statement of Net Assets is
the rate in effect as of May 31, 1999. The date shown is the next scheduled
reset date.
(C) Tri-Party Repurchase Agreement
LOC--Securities are held in connection with a letter of credit issued by a major
commercial bank or other financial institution.
RB--Revenue Bond
The following organizations have provided underlying credit support for a
security listed above.
FSA--Financial Security Assurance
MTN--Medium Term Note
The accompanying notes are an integral part of the financial statements.
36
<PAGE>
BOSTON 1784 FUNDS
AS OF MAY 31, 1999
SCHEDULE OF INVESTMENTS
- --------------------------------------------------------------------------------
Boston 1784 Short-Term Income Fund
[GRAPHIC OMITTED]
In the printed version of the document, a line graph appears which depicts the
following plot points:
U.S. Treasury Obligations 13%
Cash Equivalents 4%
Taxable Municipal Bonds 5%
Asset-Backed Securities 14%
U.S. Government Agency Mortgage-Backed Bonds 1%
U.S. Government Agency Obligations 8%
Non-Agency Mortgage-Backed Bonds 8%
Corporate Bonds 47%
% of Total Portfolio Investments
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
U.S. Treasury Obligations -- 13.5%
U.S. Treasury Bond
5.500%, 03/31/03 $ 2,000 $ 1,988
U.S. Treasury Notes
7.750%, 11/30/99 4,000 4,056
7.125%, 02/29/00 1,200 1,219
5.500%, 05/31/00 2,500 2,507
6.375%, 09/30/01 6,000 6,114
6.250%, 01/31/02 2,000 2,034
6.625%, 03/31/02 2,000 2,053
7.250%, 08/15/04 2,000 2,133
-------
Total U.S. Treasury Obligations
(Cost $22,105) 22,104
-------
U.S. Government Agency
Obligations -- 7.6%
Federal Home Loan Bank
5.625%, 03/19/01 5,500 5,498
Federal Home Loan
Mortgage Corporation
5.000%, 02/15/01 5,000 4,950
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Federal National Mortgage
Association
5.750%, 04/15/03 $ 2,000 $ 1,984
-------
Total U.S. Government
Agency Obligations
(Cost $12,598) 12,432
-------
U.S. Government Agency Mortgage-
Backed Bonds -- 0.9%
Federal Deposit Insurance
Corporation, REMIC
6.750%, 05/25/26 761 757
Federal Home Loan Mortgage
Corporation
8.000%, 01/01/02 162 167
Federal Home Loan Mortgage
Corporation, REMIC
7.250%, 04/25/24 52 52
Federal National Mortgage
Association, REMIC
8.950%, 05/25/03 483 498
-------
Total U.S. Government Mortgage-
Backed Bonds
(Cost $1,473) 1,474
-------
Taxable Municipal Bonds -- 4.9%
Carondelet, California, Health
Systems RB, Daniel Freeman
Hospitals, MBIA
6.250%, 07/01/01 4,000 4,015
New York State Dormitory
Authority RB
6.550%, 04/01/00 2,500 2,509
Pennsylvania State Housing
Finance Agency RB, FHA
7.000%, 10/01/06 1,575 1,605
-------
Total Taxable Municipal Bonds
(Cost $8,073) 8,129
-------
37
<PAGE>
AS OF MAY 31, 1999
SCHEDULE OF INVESTMENTS
- --------------------------------------------------------------------------------
Boston 1784 Short-Term Income Fund (concluded)
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Non-Agency Mortgage-Backed
Bonds -- 7.8%
BankAmerica Manufactured
Contrast Trust III,
Series 1997-2, Class A5
6.390%, 12/10/12 $ 5,500 $ 5,539
CIT RV Owners Trust,
Series 1995-A, Class A
6.250%, 01/15/11 214 216
Citibank Credit Card Trust I
5.500%, 02/15/06 5,000 4,843
Crown Home Equity Loan Trust,
Series 1996-1, Class A3
6.810%, 06/25/11 2,000 1,967
Prudential Home Mortgage
Securities, Series 1993-31,
Class A7
6.000%, 08/25/00 219 219
-------
Total Non-Agency Mortgage-
Backed Bonds
(Cost $12,922) 12,784
-------
Asset-Backed Securities -- 14.0%
Auto Leasing Investors,
Series 1997, Class A-2
5.926%, 08/14/00 5,000 5,012
Centrex Auto Trust,
Series 1996-A, Class A
6.750%, 10/15/04 685 695
Discover Card Master Trust,
Series 1993-2, Class B
5.750%, 11/16/01 5,000 5,001
Fleetwood Credit Grantor Trust,
Series 1995-B, Class A
6.550%, 05/16/11 593 597
Green Tree Recreational,
Equipment & Consumer Trust,
Series 1996-A, Class A1
5.550%, 02/15/18 262 259
PNC Student Loan Trust I,
Series 1997-2, Class A-5
6.530%, 01/25/03 5,000 5,003
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Reliance Auto Receivables,
Series 1996-A, Class A
6.100%, 07/15/02 $ 282 $ 283
Sears Credit Account Master Trust,
Series 1996-4, Class A
6.450%, 10/16/06 1,000 998
University Support Services,
Series 1993-A, Class B (A)
7.330%, 06/20/99 42 43
WFS Financial Owner Trust,
Series 1997-C, Class A4
6.150%, 09/20/02 5,000 5,024
-------
Total Asset-Backed Securities
(Cost $22,859) 22,915
-------
Corporate Bonds -- 47.3%
Electrical Services -- 0.6%
Narragansett Electric
6.630%, 08/12/99 1,000 1,001
-------
Financial Services -- 31.7%
Aristar
6.000%, 05/15/02 5,000 4,946
Associates Corporation of
North America
5.750%, 11/01/03 5,000 4,856
BankAmerica Capital III (A)
5.570%, 07/15/99 5,000 4,843
Equitable Companies
Installment Bond
6.750%, 12/01/00 780 790
Finova Capital
6.500%, 07/28/02 5,000 5,000
Ford Motor Credit
6.000%, 01/14/03 5,000 4,931
General Motors Acceptance
7.875%, 03/07/01 2,000 2,063
5.875%, 01/22/03 2,000 1,965
General Motors Acceptance MTN
5.480%, 12/16/02 5,000 4,863
Heller Financial
6.460%, 10/27/00 5,000 5,053
MBNA America Bank (A)
5.125%, 08/07/99 5,000 5,003
38
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Financial Services (continued)
Nationsbank Capital
Trust III, YB (A)
5.550%, 07/15/99 $ 2,500 $ 2,450
Salomon Smith Barney Holdings
7.500%, 05/01/02 5,000 5,150
--------
51,913
--------
Food, Beverage & Tobacco -- 3.0%
Campbell Soup
6.150%, 12/01/02 5,000 5,006
--------
Industrial -- 12.0%
American General
7.700%, 10/15/99 5,000 5,047
McKesson
6.600%, 03/01/00 5,000 5,019
Ryder System MTN
7.620%, 09/15/99 3,500 3,518
Sears Roebuck
9.500%, 06/01/99 1,000 1,000
Williams
7.500%, 09/15/99 5,000 5,025
--------
19,609
--------
Total Corporate Bonds
(Cost $77,851) 77,529
--------
Repurchase Agreement -- 4.0%
Paine Webber
4.800%, dated 05/28/99, matures
06/01/99, repurchase price
$6,614,954 (collateralized
by U.S. Treasury Instruments:
total market value
$6,743,787) (B) 6,611 6,611
--------
Total Repurchase Agreement
(Cost $6,611) 6,611
--------
Total Investments -- 100.0%
(Cost $164,492) $163,978
========
- --------------------------------------------------------------------------------
Description
- --------------------------------------------------------------------------------
(A) Variable Rate Security. The rate reported on the Schedule of Investments is
the rate in effect on May 31, 1999. The date shown is the next scheduled
reset date.
(B) Tri-Party Repurchase Agreement
MTN--Medium Term Note
RB--Revenue Bond
REMIC--Real Estate Mortgage Investment Conduit
YB--Yankee Bond
The following organizations have provided underlying credit support for the
securities as set forth in the Schedule of Investments.
FHA--Federal Housing Administration
MBIA--Municipal Bond Insurance Association
The accompanying notes are an integral part of the financial statements.
39
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Income Fund
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
In the printed version of the document, a pie chart appears which depicts the
following plot points:
U.S. Treasury Obligations 18%
Yankee Bonds 4%
Cash Equivalents 5%
Asset-Backed Securities 3%
U.S. Government Agency Obligations 10%
Corporate Bonds 30%
Non-Agency Mortgage-Backed Bonds 5%
U.S. Government Agency Mortgage-Backed Bonds 25%
% of Total Portfolio Investments
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
U.S. Government Agency Obligations -- 9.7%
Fannie Mae MTN (A)
4.990%, 08/15/01 $ 4,000 $ 3,530
Federal Home Loan
Mortgage Corporation
7.740%, 06/01/04 2,000 2,000
Federal Home Loan Bank
5.625%, 03/19/01 4,000 3,999
5.125%, 09/15/03 1,070 1,034
5.800%, 09/02/08 6,000 5,791
Federal Home Loan
Mortgage Corporation
8.530%, 02/02/05 5,000 5,065
Federal National
Mortgage Association
5.750%, 04/15/03 1,000 992
5.750%, 06/15/05 10,000 9,845
5.750%, 02/15/08 1,000 970
-------
Total U.S. Government
Agency Obligations
(Cost $34,340) 33,226
-------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
U.S. Treasury Obligations -- 17.8%
U.S. Treasury Bonds
7.875%, 02/15/21 $ 4,260 $ 5,142
8.000%, 11/15/21 9,250 11,338
6.000%, 02/15/26 700 695
5.250%, 11/15/28 10,985 9,943
U.S. Treasury Notes
6.750%, 06/30/99 5,000 5,009
5.625%, 11/30/99 1,510 1,516
5.625%, 12/31/99 1,367 1,372
5.500%, 12/31/00 7,375 7,389
6.250%, 10/31/01 8,605 8,750
5.500%, 02/28/03 1,000 994
5.500%, 05/31/03 80 79
5.750%, 08/15/03 1,030 1,032
6.500%, 05/15/05 1,386 1,436
6.500%, 10/15/06 2,050 2,131
4.750%, 11/15/08 3,000 2,790
U.S. Treasury STRIPS (B)
10.824%, 02/15/19 5,000 1,487
-------
Total U.S. Treasury Obligations
(Cost $62,143) 61,103
-------
U.S. Government Agency Mortgage-Backed
Bonds -- 25.0%
Federal Home Loan
Mortgage Corporation
7.750%, 09/01/05 524 546
5.750%, 03/15/09 3,500 3,373
6.000%, 11/01/28 17,744 16,887
Federal National
Mortgage Association
6.500%, 05/01/11 3,185 3,170
6.000%, 03/01/13 894 873
6.000%, 04/01/13 894 873
6.000%, 05/01/13 1,890 1,844
6.000%, 06/01/13 11,966 11,671
6.500%, 06/01/28 4,532 4,430
40
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
U.S. Government Agency Mortgage-Backed
Bonds (continued)
Federal National
Mortgage Association, REMIC
7.000%, 09/18/14 $ 5,000 $ 5,045
6.000%, 12/25/16 1,704 1,643
Government National Mortgage
Association
7.000%, 10/15/23 1,193 1,195
8.000%, 06/15/25 127 132
8.000%, 10/15/25 209 217
8.000%, 01/15/26 90 94
8.000%, 02/15/26 124 129
7.500%, 04/15/26 2,772 2,835
8.000%, 05/15/26 152 160
7.000%, 06/15/26 4,922 4,930
8.000%, 06/15/26 420 437
7.500%, 02/15/27 54 55
8.000%, 03/15/27 1,162 1,208
6.500%, 05/15/28 8,609 8,403
6.500%, 06/15/28 10,553 10,300
7.125%, 01/15/29 5,081 5,245
-------
Total U.S. Government Agency Mortgage-
Backed Bonds
(Cost $86,016) 85,695
-------
Asset-Backed Securities -- 3.2%
Fleetwood Credit Grantor Trust,
Series 1995-B, Class A
6.550%, 05/16/11 889 895
Green Tree Financial,
Series 1995-5, Class M1
7.650%, 09/15/26 5,000 5,074
Nomura Asset Securities,
Series 1996-MD5, Class A1B
7.120%, 04/13/36 5,000 5,091
-------
Total Asset-Backed Securities
(Cost $10,899) 11,060
-------
Non-Agency Mortgage-
Backed Bonds -- 5.1%
AFC Home Equity Loan Trust,
Series 1996-3, Class 1A4
7.540%, 12/25/27 $ 4,999 $ 5,117
Merrill Lynch Mortgage Investors,
Series 1989-H, Class B (B)
10.000%, 01/15/10 2,782 2,796
Merrill Lynch Mortgage Investors,
Series 1994-G, Class A3
8.350%, 05/15/14 5,000 5,553
Oakwood Mortgage Investors,
Series 1995-B, Class A3
6.900%, 01/15/21 4,040 3,930
-------
Total Non-Agency Mortgage-
Backed Bonds
(Cost $16,811) 17,396
-------
Corporate Bonds -- 29.8%
Communications Equipment -- 1.5%
Lucent Technologies
5.500%, 11/15/08 1,000 930
Tele Communications
9.800%, 02/01/12 3,300 4,133
-------
5,063
-------
Entertainment -- 1.8%
Time Warner Entertainment
10.150%, 05/01/12 4,965 6,231
-------
Financial Services -- 10.7%
Citigroup
5.800%, 03/15/04 4,000 3,895
First Security
6.875%, 11/15/06 5,000 4,944
First Union (C)
6.550%, 10/15/05 6,000 5,812
Fleet Mortgage Group
6.500%, 09/15/99 3,400 3,410
Ford Motor Credit
6.625%, 06/30/03 6,395 6,435
41
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Income Fund (concluded)
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Financial Services (continued)
General Motors Acceptance
6.150%, 04/05/07 $ 5,000 $ 4,869
Heller Financial
5.875%, 11/01/00 2,770 2,777
J.P. Morgan
6.000%, 01/15/09 5,000 4,700
-------
36,842
-------
Industrial -- 8.0%
American Home Products
7.700%, 02/15/00 3,190 3,234
Burlington North
9.250%, 10/01/06 5,070 5,710
Fortune Brands
6.250%, 04/01/08 3,600 3,528
Masco
6.625%, 04/15/18 5,700 5,379
Mckesson
6.300%, 03/01/05 1,814 1,728
Northrop Grumman
7.000%, 03/01/06 2,750 2,722
Weyerhaeuser
7.500%, 03/01/13 5,000 5,244
-------
27,545
-------
Insurance -- 0.7%
Vesta Insurance Group (E)
8.750%, 07/15/25 3,855 2,535
-------
Paper & Paper Products -- 1.2%
Fort James
6.875%, 09/15/07 4,000 4,030
-------
Petroleum & Fuel Products -- 1.4%
Atlantic Richfield
5.900%, 04/15/09 1,900 1,810
Enron Oil & Gas
6.000%, 12/15/08 3,380 3,151
-------
4,961
-------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Printing & Publishing -- 0.5%
News America
6.625%, 01/09/08 $ 1,660 $ 1,610
--------
Retail -- 2.1%
Gap
6.900%, 09/15/07 3,685 3,773
Staples
7.125%, 08/15/07 3,300 3,321
--------
7,094
--------
Telephones &
Telecommunications -- 1.9%
AT&T
6.500%, 03/15/29 2,850 2,647
Cable and Wireless
Communications
6.625%, 03/06/05 600 589
MCI Worldcom
6.125%, 08/15/01 3,290 3,282
--------
6,518
--------
Total Corporate Bonds
(Cost $107,772) 102,429
--------
Yankee Bonds -- 4.0%
Endesa - Chile Overseas
7.200%, 04/01/06 3,000 2,831
Hydro-Quebec
8.625%, 05/20/02 3,395 3,598
Province of Ontario
7.375%, 01/27/03 3,395 3,522
Trans-Canada Pipelines
9.125%, 04/20/06 3,340 3,770
--------
Total Yankee Bonds
(Cost $13,816) $ 13,721
--------
42
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Repurchase Agreement -- 4.7%
Paine Webber
4.800%, dated 05/28/99, matures
06/01/99, repurchase price
$16,192,352 (collateralized by
U.S. Treasury Instruments:
total market value
$16,507,715) (D) $ 16,184 $ 16,184
---------
Total Repurchase Agreement
(Cost $16,184) 16,184
---------
Total Investments -- 99.3%
(Cost $347,981) 340,814
---------
Other Assets and Liabilities,
Net -- 0.7% 2,382
---------
Net Assets:
Capital Shares (unlimited
authorization -- no par value)
based on 34,548,286 outstanding
shares of beneficial interest 348,152
Undistributed net investment
income 775
Accumulated net realized gain
on investments 1,436
Net unrealized depreciation
on investments (7,167)
---------
Total Net Assets -- 100.0% $ 343,196
=========
Net Asset Value, Offering and
Redemption Price Per Share $ 9.93
=========
(A) Zero Coupon Security. The rate reported on the Statement of Net Assets is
the effective yield as of May 31,1999.
(B) 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 institutions.
(C) Mandatory Put Security. The mandatory put date is shown as the maturity
date on the Statement of Net Assets.
(D) Tri-Party Repurchase Agreement
(E) Security is thinly traded.
MTN--Medium Term Note
REMIC--Real Estate Mortgage Investment Conduit
STRIPS--Separately Traded Registered Interest and Principal Securities
The accompanying notes are an integral part of the financial statements.
43
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 U.S. Government Medium-Term Income Fund
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
In the printed version of the document, a pie chart appears which depicts the
following plot points:
U.S. Treasury Obligations 31%
Cash Equivalents 5%
U.S. Government Mortgage-Backed Bonds 14%
U.S. Government Agency Obligations 43%
Asset-Backed Securities 1%
U.S. Government Guaranted Bonds 6%
% of Total Portfolio Investments
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
U.S. Treasury Obligations -- 32.4%
U.S. Treasury Bonds
11.250%, 02/15/15 $ 700 $ 1,063
6.000%, 02/15/26 6,100 6,055
5.250%, 11/15/28 2,800 2,534
U.S. Treasury Notes
5.375%, 01/31/00 2,800 2,808
5.500%, 03/31/00 5,600 5,620
8.000%, 05/15/01 2,000 2,094
6.625%, 07/31/01 463 474
6.250%, 10/31/01 5,500 5,593
7.500%, 11/15/01 1,600 1,672
6.250%, 01/31/02 2,000 2,034
6.000%, 07/31/02 1,000 1,011
5.500%, 02/28/03 15,000 14,904
5.500%, 05/31/03 19,420 19,284
5.250%, 08/15/03 10,000 9,838
7.500%, 02/15/05 7,800 8,438
6.250%, 02/15/07 770 790
6.625%, 05/15/07 500 525
6.125%, 08/15/07 2,000 2,039
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
U.S. Treasury STRIPS (A)
10.390%, 08/15/10 $ 1,000 $ 511
10.824%, 02/15/19 3,000 892
12.269%, 05/15/20 5,000 1,385
-------
Total U.S. Treasury Obligations
(Cost $91,055) 89,564
-------
U.S. Government Agency
Obligations -- 43.8%
Agency of Housing and Urban
Development, Series 1995-A
8.240%, 08/01/02 2,000 2,113
Agency of Housing and Urban
Development, Series 1997-A
6.210%, 08/01/01 4,000 4,040
6.360%, 08/01/04 5,500 5,564
CABEI AID
6.620%, 10/29/12 10,000 9,900
Costa Rica AID
7.360%, 08/01/01 1,100 1,118
Federal Farm Credit Bank
8.650%, 10/01/99 1,900 1,922
7.350%, 03/24/05 350 370
Federal Farm Credit Bank (B)
5.137%, 06/01/99 10,000 9,998
Federal Home Loan Mortgage
Corporation
5.750%, 07/15/03 3,500 3,469
Federal Home Loan Bank
5.500%, 04/14/00 5,000 5,005
5.625%, 03/19/01 5,000 4,998
6.580%, 01/07/03 3,000 3,021
7.660%, 07/20/04 350 374
Federal Home Loan Bank (B)
5.161%, 06/01/99 7,000 7,000
Federal Home Loan Mortgage
Corporation
7.000%, 07/15/03 1,199 1,209
7.000%, 10/01/03 55 56
8.530%, 02/02/05 1,000 1,013
7.340%, 11/03/06 1,000 1,007
44
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
U.S. Government Agency
Obligations (continued)
Federal National Mortgage
Association
5.750%, 04/15/03 $ 12,400 $ 12,302
5.125%, 02/13/04 805 775
7.550%, 06/10/04 1,500 1,501
6.580%, 03/01/06 1,000 1,006
8.000%, 07/01/07 201 208
6.000%, 05/15/08 5,250 5,171
6.500%, 05/01/11 1,592 1,585
7.785%, 02/01/19 4,817 5,430
10.000%, 10/01/20 1,721 1,861
10.000%, 12/01/20 2,292 2,478
Federal National Mortgage
Association MTN (A)
4.990%, 08/15/01 4,000 3,530
Private Export Funding
Corporation
5.500%, 03/15/01 2,500 2,488
6.310%, 09/30/04 7,000 7,079
6.620%, 10/01/05 1,740 1,773
7.110%, 04/15/07 3,800 4,013
Student Loan Marketing
Association (B)
5.101%, 06/01/99 6,000 5,999
Tennessee Valley Authority
Principal STRIPS (A)
4.374%, 04/15/42 4,000 1,775
--------
Total U.S. Government Agency
Obligations
(Cost $120,885) 121,151
--------
U.S. Government Mortgage-
Backed Bonds -- 14.6%
Federal Deposit Insurance
Corporation, REMIC
6.750%, 05/25/26 1,903 1,893
Federal Home Loan Mortgage
Corporation Gold
7.000%, 12/01/10 1,199 1,218
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Federal Home Loan Mortgage
Corporation, REMIC
6.750%, 02/15/20 $ 1,080 $ 1,081
Federal National Mortgage
Association
6.000%, 04/01/13 10,605 10,344
6.000%, 06/01/13 141 138
Government National Mortgage
Association
8.500%, 10/15/04 72 76
8.500%, 01/15/06 56 59
9.000%, 11/15/17 832 898
7.000%, 10/15/23 673 674
7.500%, 02/15/27 1,493 1,528
6.500%, 03/15/29 19,959 19,480
Student Loan Marketing
Association (B)
5.161%, 06/01/99 3,014 3,002
-------
Total U.S. Government
Mortgage-Backed Bonds
(Cost $40,958) 40,391
-------
U.S. Government
Guaranteed Bonds -- 6.4%
Global Industries
7.250%, 07/15/22 11,587 12,219
Rochester, New York,
U.S. Government Note,
Series 1991-A
5.930%, 08/01/99 100 100
Secunda Atlantic Title XI
6.695%, 04/01/18 3,899 3,856
Sulphur Carriers
8.300%, 10/15/09 1,347 1,430
-------
Total U.S. Government
Guaranteed Bonds
(Cost $16,640) 17,605
-------
45
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 U.S. Government Medium-Term Income Fund (concluded)
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Asset-Backed Security -- 0.4%
PNC Student Loan Trust I,
Series 1997-2, Class A-2
6.138%, 01/25/00 $ 1,194 $ 1,196
---------
Total Asset-Backed Security
(Cost $1,195) 1,196
---------
Non-Agency Mortgage-
Backed Bond -- 0.0%
Ryland Acceptance Four,
Series 32, Class B
8.600%, 05/01/16 140 140
---------
Total Non-Agency Mortgage-
Backed Bond
(Cost $145) 140
---------
Repurchase Agreement -- 5.0%
Paine Webber
4.800%, dated 05/28/99, matures
06/01/99, repurchase price
$13,882,118 (collateralized
by U.S. Treasury Instruments:
total market value
$14,152,487) (C) 13,875 13,875
---------
Total Repurchase Agreement
(Cost $13,875) 13,875
---------
Total Investments -- 102.6%
(Cost $284,753) 283,922
---------
Other Assets and Liabilities,
Net -- (2.6%) (7,141)
---------
- --------------------------------------------------------------------------------
Description Value (000)
- --------------------------------------------------------------------------------
Net Assets:
Capital Shares (unlimited
authorization -- no par value)
based on 29,277,991 outstanding
shares of beneficial interest $ 283,326
Distributions in excess of net
investment income (536)
Accumulated net realized loss
on investments (5,178)
Net unrealized depreciation
on investments (831)
---------
Total Net Assets -- 100.0% $ 276,781
=========
Net Asset Value, Offering and
Redemption Price Per Share $ 9.45
=========
(A) Zero Coupon Security. The rate reported on the Statement of Net Assets is
the effective yield as of May 31, 1999.
(B) Variable Rate Security. The rate reported on the Statement of Net Assets is
the rate in effect on May 31,1999. The date shown is the next scheduled
reset date.
(C) Tri-Party Repurchase Agreement
AID--Agency for International Development
MTN--Medium Term Note
REMIC--Real Estate Mortgage Investment Conduit
STRIPS--Separately Traded Registered Interest and Principal Securities
The accompanying notes are an integral part of the financial statements.
46
<PAGE>
BOSTON 1784 FUNDS
AS OF MAY 31, 1999
SCHEDULE OF INVESTMENTS
- --------------------------------------------------------------------------------
Boston 1784 Tax-Exempt Medium-Term Income Fund
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
In the printed version of the document, a pie chart appears which depicts the
following plot points:
Alternative Minimum Tax-Bonds 2%
Health Care Bonds 5%
Cash Equivalents 4%
Transportation Bonds 13%
General Obligation Bonds 32%
Industrial Development & Pollution Control Bonds 1%
Other Revenue Bonds 5%
Resource Recovery Bonds 2%
Housing Bonds 8%
Education Bonds 4%
Public Facility Bonds 1%
Utility Bonds 23%
% of Total Portfolio Investments
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Municipal Bonds -- 96.4%
Alabama -- 0.7%
Alabama State Housing Finance
Authority RB, Series D-1, GNMA
6.000%, 10/01/16 $ 950 $ 993
Alabama State Water Pollution
Control Authority RB, AMBAC
5.000%, 02/15/13 1,500 1,506
-------
2,499
-------
Arkansas -- 0.3%
Arkansas State GO
5.000%, 06/01/15 1,000 986
-------
California -- 6.1%
Burbank, Wastewater
Treatment RB, Series A, FGIC
5.500%, 06/01/15 1,500 1,564
California State GO
5.250%, 10/01/09 1,500 1,597
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
California State GO,
Series BH, AMT, FSA
5.250%, 12/01/12 $ 4,350 $ 4,426
California State GO, FGIC
5.250%, 10/01/10 2,000 2,102
California State Home
Mortgage RB, Series A, MBIA
5.850%, 08/01/16 2,000 2,083
California State Housing
Finance Agency RB,
Home Mortgage, MBIA
5.950%, 08/01/10 1,830 1,919
California State Unlimited Tax GO
5.250%, 06/01/11 1,000 1,059
Los Angeles County,
Metropolitan Transportation
Authority RB, FSA
5.000%, 07/01/14 5,630 5,658
Los Angeles County,
Metropolitan Transportation
Authority RB, AMBAC
5.700%, 07/01/12 1,135 1,219
-------
21,627
-------
Colorado -- 1.8%
Colorado Springs, Sales &
Use Tax RB
5.000%, 12/01/12 4,320 4,348
Denver, Multi-Family Housing RB,
Section 8, Series A
5.350%, 10/01/12 2,000 2,025
-------
6,373
-------
Connecticut -- 2.4%
Connecticut State GO, Series C
5.250%, 10/15/11 4,000 4,190
Connecticut State Health &
Education Facilities
Authority RB, Series D, GOI
6.750%, 07/01/12 1,250 1,341
47
<PAGE>
AS OF MAY 31, 1999
SCHEDULE OF INVESTMENTS
- --------------------------------------------------------------------------------
Boston 1784 Tax-Exempt Medium-Term Income Fund (continued)
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Connecticut (continued)
Connecticut State Housing
Finance Authority RB,
Series A, GOA
6.100%, 05/15/17 $1,000 $1,047
Connecticut State Unlimited
Tax GO, Series D
5.000%, 12/01/12 2,000 2,032
------
8,610
------
District of Columbia -- 1.0%
District of Columbia GO,
Series A, MBIA
5.000%, 06/01/15 2,500 2,447
Georgetown University RB,
Series A, MBIA
5.950%, 04/01/14 1,000 1,101
------
3,548
------
Florida -- 2.6%
Dade County GO,
Series EE, FGIC
5.625%, 10/01/14 2,560 2,710
Florida State Board of
Education GO, Series A
5.000%, 01/01/15 3,250 3,234
Florida State Board of
Education GO, Series E
5.700%, 06/01/14 2,000 2,137
Village Center Community,
Florida Utility RB
5.250%, 10/01/15 1,000 1,017
------
9,098
------
Georgia -- 0.9%
Georgia State Municipal
Electric Authority RB, MBIA
5.125%, 01/01/12 3,000 3,056
------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Illinois -- 1.4%
Chicago, O'Hare International
Airport RB, AMBAC
5.625%, 01/01/12 $2,000 $2,105
Illinois State GO
5.000%, 04/01/12 2,750 2,768
------
4,873
------
Louisiana -- 0.6%
Louisiana State GO, FSA
5.000%, 04/15/14 2,000 1,992
------
Maine -- 2.2%
Maine Municipal Bond
Bank RB, FSA
5.150%, 11/01/13 1,250 1,270
Maine State Health & Higher
Educational Facilities
Authority RB, MBIA
5.000%, 07/01/11 1,680 1,703
4.750%, 07/01/13 1,500 1,457
Maine State Housing
Authority RB, Series C-1
5.700%, 11/15/15 2,000 2,058
Maine State Housing
Authority RB, Series F-1, HUD
5.125%, 11/15/15 1,300 1,285
------
7,773
------
Maryland -- 1.6%
Maryland State & Local
Facilities GO, 1st Series
5.000%, 03/01/10 1,500 1,545
Maryland State GO
5.000%, 07/15/10 4,000 4,125
------
5,670
------
48
<PAGE>
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Massachusetts -- 13.9%
Holyoke GO, Series A, FSA
5.600%, 06/15/10 $1,365 $1,450
Massachusetts State Bay
Transportation Authority RB,
Series C, FGIC
5.500%, 03/01/11 3,000 3,203
Massachusetts State GO, AMBAC
5.000%, 08/01/14 2,500 2,503
Massachusetts State GO, Series A
5.000%, 11/01/13 1,200 1,206
Massachusetts State GO,
Series A, MBIA
5.000%, 04/01/14 4,650 4,662
Massachusetts State GO,
Series B, FGIC
5.500%, 06/01/11 2,000 2,103
Massachusetts State GO, Series C
5.250%, 08/01/08 1,500 1,584
Massachusetts State GO,
Series D, FGIC
5.125%, 11/01/12 1,000 1,020
Massachusetts State Grant
Anticipation Note, Series A
5.250%, 12/15/08 3,000 3,161
Massachusetts State Health &
Educational Facilities
Authority RB, Dana Farber
Cancer Project, Series G-1
6.250%, 12/01/08 1,000 1,091
Massachusetts State Health &
Educational Facilities
Authority RB, Eye & Ear
Infirmary, Series B
5.250%, 07/01/11 1,000 1,018
Massachusetts State Health &
Educational Facilities
Authority RB, Harvard Pilgrim
Health, Series A, FSA
5.250%, 07/01/13 2,215 2,265
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Massachusetts State Health &
Educational Facilities
Authority RB, Medical,
Academic & Scientific
Project, Series A
6.250%, 01/01/05 $1,060 $1,154
Massachusetts State Health &
Educational Facilities
Authority RB, Partners
Healthcare System, Series B
5.000%, 07/01/07 2,090 2,145
Massachusetts State Health &
Educational Facilities
Authority RB, Suffolk
University Project,
Series C, CONLEE
5.850%, 07/01/16 1,000 1,064
Massachusetts State Housing
Finance Agency RB, Series 44
5.900%, 12/01/13 785 811
Massachusetts State Housing
Finance Agency RB,
Series A, MBIA
5.600%, 07/01/07 475 506
5.700%, 07/01/08 475 506
Massachusetts State Industrial
Finance Agency RB, College
Issue, CONLEE
5.875%, 07/01/11 1,090 1,179
Massachusetts State Industrial
Finance Agency RB, Resource
Recovery, Ogden Haverhill
Project, AMT
5.150%, 12/01/07 1,250 1,253
Massachusetts State Industrial
Finance Agency RB,
Resource Recovery
4.950%, 12/01/06 1,710 1,721
Massachusetts State Municipal
Wholesale Electric
Company RB, AMBAC
5.150%, 07/01/16 2,000 1,970
49
<PAGE>
AS OF MAY 31, 1999
SCHEDULE OF INVESTMENTS
- --------------------------------------------------------------------------------
Boston 1784 Tax-Exempt Medium-Term Income Fund (continued)
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Massachusetts (continued)
Massachusetts State Public
Improvements GO
5.000%, 01/01/12 $ 1,350 $ 1,358
Massachusetts State Resource
Recovery Authority RB,
Refusetech Project, Series A
6.150%, 07/01/02 1,595 1,663
6.300%, 07/01/05 3,220 3,437
Massachusetts State Turnpike
Authority RB, Highway
System, Series B
5.125%, 12/15/13 2,500 2,550
Massachusetts State Turnpike
Authority RB, Metropolitan
Highway System,
Sub-Series B, MBIA
5.250%, 01/01/17 1,000 1,005
Massachusetts State Turnpike
Authority RB, Metropolitan
Highway System,
Series C, MBIA (A)
5.400%, 01/01/16 1,000 429
Massachusetts State Turnpike
Authority RB, Series A
5.000%, 01/01/12 1,250 1,252
-------
49,269
-------
Minnesota -- 2.9%
Minnesota State GO
5.000%, 06/01/14 5,000 5,031
Northern Minnesota State
Municipal Power Agency RB,
Electric System, FSA
5.250%, 01/01/12 2,490 2,571
Southern Minnesota Municipal
Power Utility RB
5.000%, 01/01/13 2,715 2,732
-------
10,334
-------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Mississippi -- 1.9%
Mississippi State Capital
Imports GO, Series A
5.000%, 07/01/09 $1,000 $1,032
Mississippi State GO
5.000%, 06/01/15 3,645 3,622
Mississippi State GO, FGIC
5.000%, 11/01/09 2,000 2,070
------
6,724
------
Missouri -- 0.9%
St. Charles County, Public Water
Supply District #2 COP,
Series A, MBIA
5.500%, 12/01/14 3,000 3,086
------
Nebraska -- 2.7%
Nebraska Public Power
Distribution RB, Series A
5.125%, 01/01/15 3,000 3,012
Nebraska State Investment
Finance Authority RB,
Childrens Healthcare
Services, AMBAC
5.500%, 08/15/17 1,435 1,485
Nebraska State Public Gas
Supply System RB, American
Public Energy, Series A, AMBAC
5.250%, 06/01/11 5,000 5,169
------
9,666
------
Nevada -- 0.7%
Nevada State GO
5.000%, 05/15/15 2,500 2,484
------
New Hampshire -- 1.4%
New Hampshire State Higher
Education & Health Facilities
Authority RB, Dartmouth
Education Loan Remarketing
5.300%, 06/01/15 1,045 1,065
50
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
New Hampshire (continued)
New Hampshire State Higher
Education & Health Facilities
Authority RB, LOC
5.800%, 10/01/12 $1,000 $1,025
New Hampshire State Housing
Finance Authority RB,
Series B, FHA
5.850%, 07/01/10 945 978
New Hampshire State RB
5.000%, 08/15/13 2,050 2,055
------
5,123
------
New Jersey -- 1.0%
New Jersey State Transportation
Authority RB, Series A
5.000%, 06/15/12 3,500 3,520
------
New York -- 10.2%
Metropolitan Transportation
Authority RB
5.125%, 07/01/12 1,225 1,248
Metropolitan Transportation
Authority RB, Commuter
Facilities, Series A, FGIC
5.750%, 07/01/11 1,000 1,075
Metropolitan Transportation
Authority RB, Series C, FSA
5.125%, 07/01/13 5,000 5,100
Metropolitan Transportation
Authority RB, Transportation
Service Contract, Series R
5.500%, 07/01/14 1,740 1,803
New York City GO
5.000%, 08/01/14 4,000 3,940
5.000%, 08/15/14 1,000 985
New York City GO, Series C
5.250%, 08/15/11 2,080 2,129
New York City GO, Series D
6.000%, 02/15/09 1,000 1,078
6.000%, 02/15/12 660 704
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
New York City GO, Series D (B)
6.000%, 02/15/12 $ 630 $ 689
New York City GO, Series F
5.250%, 08/01/14 3,000 3,026
New York City Transitional
Finance Authority RB, Series A
5.000%, 08/15/13 1,350 1,352
New York Metropolitan Transit
Authority Commuter
Facilities RB, Series A, FSA
5.500%, 07/01/15 1,530 1,597
New York State Dormitory
Authority RB, City University
System Consolidated,
Third-1, FGIC
5.250%, 07/01/13 1,580 1,625
New York State Dormitory
Authority RB, Series A, STGTD
5.500%, 05/15/10 1,000 1,039
New York State GO
5.000%, 03/15/14 2,000 1,995
New York State GO,
Series C, AMBAC
5.375%, 10/01/11 3,000 3,116
New York State Housing Finance
Agency RB, Series A, FSA
5.800%, 11/01/09 1,720 1,830
New York State Urban
Development Authority RB,
Youth Facilities Project, MBIA
5.700%, 04/01/14 1,505 1,576
-------
35,907
-------
North Carolina -- 3.5%
North Carolina State, Eastern
Municipal Power
Agency RB, FGIC
6.000%, 01/01/13 2,000 2,148
North Carolina State, Eastern
Municipal Power Agency RB
6.000%, 01/01/14 4,000 4,130
5.600%, 01/01/16 2,000 1,998
51
<PAGE>
AS OF MAY 31, 1999
SCHEDULE OF INVESTMENTS
- --------------------------------------------------------------------------------
Boston 1784 Tax-Exempt Medium-Term Income Fund (continued)
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
North Carolina (continued)
North Carolina State, Eastern
Municipal Power
Agency RB, Series D
5.875%, 01/01/14 $ 1,035 $ 1,062
North Carolina State, Eastern
Municipal Power Agency RB,
Series D, ACA
5.600%, 01/01/16 3,000 3,105
-------
12,443
-------
Ohio -- 0.8%
Ohio State Public Facilities
Commission RB, Higher
Education Authority, Series II-A
5.000%, 05/01/08 2,900 2,983
-------
Pennsylvania -- 7.4%
Montgomery County GO
5.250%, 10/15/08 1,250 1,330
Pennsylvania State GO
5.250%, 06/15/12 2,155 2,203
Pennsylvania State GO,
1st Series, AMBAC
5.125%, 03/15/12 2,000 2,043
Pennsylvania State Higher
Education & Health
Services RB, Series A
5.750%, 01/01/12 1,300 1,352
Pennsylvania State Higher
Education Facilities
Authority RB, MBIA
5.250%, 01/01/13 2,000 2,050
Pennsylvania State Housing
Finance Agency RB, Single
Family Mortgages, Series A
6.000%, 10/01/13 2,000 2,090
Pennsylvania State Turnpike
Commission RB,
Series A, AMBAC
5.250%, 12/01/13 3,330 3,432
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Philadelphia, Water and
Wastewater Projects RB, FGIC
5.650%, 06/15/12 $ 5,000 $ 5,288
Southeastern Pennsylvania
Transportation Authority RB,
Series A, FGIC
5.125%, 03/01/08 1,450 1,513
Southeastern Pennsylvania
Transportation Authority RB,
Series B, FGIC
5.250%, 03/01/12 4,785 4,941
-------
26,242
-------
Puerto Rico -- 6.7%
Puerto Rico Commonwealth GO
5.250%, 07/01/10 1,000 1,049
5.500%, 07/01/12 2,000 2,153
5.750%, 07/01/17 2,000 2,133
Puerto Rico Electric Power
Authority RB
5.250%, 07/01/14 7,100 7,357
5.500%, 07/01/16 3,000 3,105
Puerto Rico Electric Power
Authority RB, Series CC, FSA
5.000%, 07/01/10 2,435 2,517
Puerto Rico Municipal Finance
Agency RB, Series A, FSA
5.250%, 07/01/10 4,000 4,200
Puerto Rico Public Education &
Health Facilities RB,
Series M, CGTD
5.750%, 07/01/15 1,000 1,044
-------
23,558
-------
Rhode Island -- 2.5%
Rhode Island State Depositors
Economic Protection RB,
Series A, MBIA
6.400%, 08/01/06 1,000 1,124
Rhode Island State Health &
Educational RB
5.100%, 07/01/07 1,520 1,495
52
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Rhode Island (continued)
Rhode Island State Housing &
Mortgage Finance RB,
Series 7B, AMT
6.700%, 10/01/12 $ 1,750 $ 1,848
Rhode Island State Housing &
Mortgage Finance RB,
Series 15B
6.200%, 10/01/06 1,110 1,177
Rhode Island State Housing &
Mortgage Finance RB,
Series 19A
5.700%, 04/01/15 2,500 2,547
Rhode Island State Housing &
Mortgage Finance RB,
Series A, AMBAC
5.700%, 07/01/07 685 731
-------
8,922
-------
South Carolina -- 1.5%
South Carolina State GO,
Highway System, Series A
4.600%, 05/01/12 4,000 3,925
South Carolina State Public
Service Authority RB,
Series B, FGIC
5.875%, 01/01/14 1,150 1,248
-------
5,173
-------
Texas -- 5.0%
Tarrant County, Health Facilities
Authority RB, Harris
Methodist Health System
Project, Series A, AMBAC
5.125%, 09/01/12 2,700 2,707
Texas A&M University RB
5.200%, 05/15/10 2,580 2,664
Texas State GO
5.125%, 10/01/09 4,000 4,175
5.125%, 10/01/14 8,000 8,085
-------
17,631
-------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Virginia -- 0.5%
Virginia State Housing
Development Authority RB,
Series H
5.700%, 11/01/07 $ 1,655 $ 1,761
-------
Washington -- 10.1%
Washington State Public
Power Supply RB
5.125%, 07/01/13 5,000 5,056
Washington State Public Power
Supply Systems RB, Nuclear
Power Project No. 1, Series B
5.125%, 07/01/14 3,000 2,993
Washington State Public Power
Supply Systems RB, Nuclear
Power Project No. 1, FSA
5.400%, 07/01/12 7,800 7,985
Washington State Public Power
Supply Systems RB, Nuclear
Power Project No. 3, Series A (A)
5.050%, 07/01/13 2,000 980
Washington State Public Power
Supply Systems RB, Nuclear
Power Project No. 3,
Series A, FSA
5.100%, 07/01/10 2,500 2,581
Washington State Public Power
Supply Systems RB, Nuclear
Project No. 2, Series A, FSA
5.000%, 07/01/11 10,115 10,305
Washington State Public Power
Supply Systems RB, Nuclear
Project No. 1, Series A
5.000%, 07/01/11 1,000 998
5.000%, 07/01/13 4,000 3,960
Washington State Public Power
Supply Systems RB, Nuclear
Project No. 2, Series A, FSA
5.125%, 07/01/11 1,000 1,026
-------
35,884
-------
53
<PAGE>
AS OF MAY 31, 1999
SCHEDULE OF INVESTMENTS
- --------------------------------------------------------------------------------
Boston 1784 Tax-Exempt Medium-Term Income Fund (concluded)
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
West Virginia -- 0.3%
West Virginia State GO
5.000%, 06/01/14 $ 1,000 $ 1,003
--------
Wisconsin -- 0.9%
Wisconsin State Housing &
Economic Development
Authority RB, Home
Ownership, Series E, GOA
5.900%, 09/01/16 1,000 1,034
Wisconsin State Housing &
Economic Development
Authority RB, Series C, GOA
5.800%, 11/01/13 2,125 2,199
--------
3,233
--------
Total Municipal Bonds
(Cost $334,384) 341,051
--------
Repurchase Agreement -- 3.6%
Paine Webber
4.800%, dated 05/28/99, matures
06/01/99, repurchase price
$12,682,963 (collateralized by
U.S. Treasury Instruments:
total market value
$12,929,977) (C) 12,676 12,676
--------
Total Repurchase Agreement
(Cost $12,676) 12,676
--------
Total Investments -- 100.0%
(Cost $347,060) $353,727
========
(A) Zero Coupon Bond. The rate reported on the Schedule of Investments is the
effective yield as of May 31,1999.
(B) Pre-refunded Security. The pre-refunded date is shown as the maturity date
on the Schedule of Investments.
(C) Tri-Party Repurchase Agreement
AMT--Alternative Minimum Tax
COP--Certificate of Participation
GO--General Obligation Bond
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
HUD--Department of Housing & Urban Development
LOC--Securities are held in connection with a letter of credit issued by a major
commercial bank or other financial institution.
RB--Revenue Bond
The following organizations have provided underlying credit support for the
securities as set forth in the Schedule of Investments.
ACA--American Capital Access
AMBAC--American Municipal Bond Assurance Company
CGTD--Commonwealth Guaranteed
CONLEE--College Construction Loan Insurance
FGIC--Financial Guaranty Insurance Corporation
FHA--Federal Housing Administration
FSA--Financial Security Assurance
GNMA--Government National Mortgage Association
GOA--General Obligation of Authority
GOI--General Obligation of Institution
MBIA--Municipal Bond Insurance Association
STGTD--State Guaranteed
The accompanying notes are an integral part of the financial statements.
54
<PAGE>
BOSTON 1784 FUNDS
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Connecticut Tax-Exempt Income Fund
[GRAPHIC OMITTED]
In the printed version of the document, a pie chart appears which depicts the
following plot points:
Water & Sewer Bonds 3%
Industrial Development & Pollution Control Bonds 2%
Health Care Bonds 16%
Other Revenue Bonds 3%
Resource Recovery Bonds 8%
Cash Equivalents 3%
Education Bonds 3%
Utility Bonds 3%
Housing Bonds 10%
Public Facility Bonds 1%
Alternative Minimum Tax Bonds 4%
Transportation Bonds 13%
General Obligation Bonds 31%
% of Total Portfolio Investments
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Municipal Bonds -- 96.0%
Connecticut -- 81.0%
Bridgeport GO, AMBAC
5.450%, 03/01/11 $1,550 $1,624
Bridgeport GO
6.500%, 09/01/08 1,435 1,659
Bristol, Resource Recovery RB,
Ogden Martin System Project
6.500%, 07/01/14 3,000 3,247
Connecticut State Airport RB,
Bradley International
Airport, FGIC
7.650%, 10/01/12 2,000 2,302
Connecticut State Development RB,
Duncaster Project
6.700%, 09/01/07 3,350 3,597
Connecticut State GO
5.250%, 03/15/14 9,500 9,797
Connecticut State GO, FGIC
5.000%, 09/01/14 880 884
Connecticut State GO, Series A
5.250%, 03/01/14 2,445 2,521
5.125%, 03/15/15 3,895 3,949
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Connecticut State GO, Series B
5.125%, 03/15/11 $1,000 $1,036
Connecticut State GO, Series C
5.800%, 08/15/08 1,500 1,614
Connecticut State GO, Series D
5.125%, 12/15/13 4,790 4,904
5.250%, 12/15/15 500 514
Connecticut State GO, University
of Connecticut Series A, MBIA
5.000%, 06/01/16 3,000 2,966
Connecticut State Health &
Education Facilities
Authority RB
4.650%, 07/01/11 1,390 1,347
Connecticut State Health &
Education Facilities
Authority RB, AMBAC
5.200%, 07/01/14 2,840 2,879
5.000%, 07/01/17 1,000 976
Connecticut State Health &
Education Facilities
Authority RB, Bridgeport
Hospital, Series C, CONLEE
5.250%, 07/01/15 1,615 1,633
Connecticut State Health &
Education Facilities
Authority RB, Greenwich
Hospital, Series A, MBIA
5.750%, 07/01/16 2,000 2,115
Connecticut State Health &
Education Facilities
Authority RB, Hospital For
Special Care
5.375%, 07/01/17 5,000 5,087
Connecticut State Health &
Education Facilities
Authority RB, New Britain
Hospital, Series B, AMBAC
6.000%, 07/01/09 500 545
55
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Connecticut Tax-Exempt Income Fund (continued)
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Connecticut (continued)
Connecticut State Health &
Education Facilities
Authority RB, New Haven
Hospital, Series H, MBIA
5.625%, 07/01/16 $1,000 $1,045
Connecticut State Health &
Education Facilities
Authority RB, New Horizons
Village Project, AMBAC
7.050%, 11/01/09 1,000 1,150
Connecticut State Health &
Education Facilities
Authority RB, Newington
Children's Hospital,
Series A, MBIA
5.850%, 07/01/07 1,110 1,199
Connecticut State Health &
Education Facilities
Authority RB, Series D, GOI
6.750%, 07/01/12 2,750 2,949
Connecticut State Health &
Education Facilities
Authority RB, Sharon Health
Care Project, AMBAC
6.000%, 11/01/09 1,000 1,097
Connecticut State Health &
Education Facilities
Authority RB, Stamford
Hospital, MBIA
5.400%, 07/01/09 2,000 2,125
Connecticut State Health &
Education Facilities
Authority RB, William W. Backus
Hospital, Series E, AMBAC
5.000%, 07/01/17 1,000 976
Connecticut State Health &
Education Facilities Authority
Sacred Heart University
Project, Series E
4.900%, 07/01/13 3,400 3,315
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Connecticut State Higher
Education RB, Family
Education Loan Program,
Series A, AMT
7.000%, 11/15/05 $1,095 $1,150
Connecticut State Housing
Finance Authority RB, GOA
6.200%, 05/15/14 430 457
Connecticut State Housing
Finance Authority RB, Mortgage
Finance Program, Series A, GOA
5.950%, 05/15/11 3,215 3,368
6.200%, 05/15/14 1,350 1,429
Connecticut State Housing
Finance Authority RB, Mortgage
Finance Program, Series B
6.050%, 11/15/03 500 537
Connecticut State Housing
Finance Authority RB, Mortgage
Finance Program,
Series C-1, GOA
6.000%, 11/15/10 1,010 1,060
Connecticut State Housing
Finance Authority RB, Mortgage
Finance Program, Series H-1
5.100%, 05/15/17 1,000 989
Connecticut State Housing
Finance Authority RB,
Mortgage Finance Program,
Sub-Series A-3, GOA
5.950%, 05/15/17 1,000 1,037
Connecticut State Housing
Finance Authority RB,
Mortgage Finance Program,
Sub-Series B1
6.000%, 11/15/15 2,000 2,085
Connecticut State Housing
Finance Authority RB,
Mortgage Finance Program,
Sub-Series B1, GOA
6.000%, 05/15/08 230 243
56
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Connecticut (continued)
Connecticut State Housing
Finance Authority RB,
Mortgage Finance Program,
Sub-Series E-1, GOA
5.900%, 05/15/15 $ 4,200 $ 4,378
Connecticut State Resource
Recovery Authority RB,
American Fuel Company,
Series A, MBIA
5.125%, 11/15/14 7,125 7,080
Connecticut State Resource
Recovery Authority RB,
Mid-Connecticut System
Project, Series A, AMT, MBIA
5.500%, 11/15/11 6,000 6,308
Connecticut State Resource
Recovery Authority RB,
Mid-Connecticut System
Project, Series A, MBIA
5.375%, 11/15/10 2,000 2,100
Connecticut State Special Tax RB
5.000%, 11/01/16 3,000 2,936
Connecticut State Special
Tax RB, AMBAC
5.250%, 01/01/11 500 516
Connecticut State Special
Tax RB, Transportation
Infrastructure, Series A
5.700%, 06/01/12 1,160 1,237
Connecticut State Special
Tax RB, Transportation
Infrastructure, Series A, FGIC
5.600%, 06/01/13 1,000 1,051
5.250%, 10/01/14 2,100 2,153
Connecticut State Special
Tax RB, Transportation
Infrastructure, Series B, FGIC
5.500%, 10/01/11 4,920 5,301
Connecticut State Transportation
Improvement RB
5.500%, 10/01/12 4,000 4,190
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Connecticut State Transportation
Infrastructure RB, Series B, FSA
5.250%, 11/01/15 $ 1,000 $ 1,019
Connecticut State Transportation
Infrastructure RB, Series C
5.000%, 10/01/13 2,455 2,458
Connecticut State Unlimited Tax GO
5.250%, 03/15/13 6,000 6,195
Connecticut State Unlimited
Tax GO, Series D
5.000%, 12/01/12 3,500 3,557
Connecticut State Water RB
5.250%, 07/15/11 3,000 3,124
Eastern Connecticut Resource
Recovery Authority RB,
Wheelabrator Libson
Project, Series A
5.500%, 01/01/14 2,775 2,751
Hartford GO, FGIC
5.700%, 10/01/12 500 536
5.750%, 10/01/13 1,000 1,074
4.700%, 01/15/15 1,340 1,300
New Haven GO, FGIC
4.700%, 02/01/15 1,875 1,819
South Central Connecticut
Regional Water Authority RB,
Series A, MBIA
6.000%, 08/01/09 985 1,065
6.000%, 08/01/10 1,045 1,126
Stamford GO
5.000%, 07/15/15 2,195 2,206
University of Connecticut RB,
Series A, MBIA
5.250%, 04/01/14 1,000 1,023
Waterbury, Connecticut
Unlimited Tax GO
4.800%, 02/15/12 1,400 1,372
4.900%, 02/15/13 1,470 1,444
5.000%, 02/15/14 1,395 1,378
--------
152,104
--------
57
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Connecticut Tax-Exempt Income Fund (continued)
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Guam -- 0.6%
Guam Power Authority RB,
Series A, AMBAC
5.900%, 10/01/08 $ 1,000 $ 1,106
--------
Puerto Rico -- 14.4%
Puerto Rico Commonwealth GO
5.250%, 07/01/10 1,250 1,311
5.750%, 07/01/17 2,700 2,879
Puerto Rico
Commonwealth GO (A)
5.061%, 07/01/14 4,500 2,121
Puerto Rico Commonwealth
Highway & Transportation
Infrastructure RB, MBIA
5.250%, 07/01/14 2,615 2,707
Puerto Rico Electric Power
Authority RB
5.250%, 07/01/14 2,650 2,746
5.500%, 07/01/14 1,000 1,045
5.500%, 07/01/16 1,000 1,035
Puerto Rico Highway &
Transportation RB, Series X
5.300%, 07/01/04 700 731
Puerto Rico Industrial, Tourist,
Educational, Medical, &
Environmental Control
Facilities RB, Abbott
Chemicals Project
6.500%, 07/01/09 500 501
Puerto Rico Industrial, Tourist,
Educational, Medical, &
Environmental Control
Facilities RB, International
American University,
Series A, MBIA
5.250%, 10/01/12 725 756
5.375%, 10/01/13 975 1,020
5.500%, 10/01/14 650 685
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Puerto Rico Industrial, Tourist,
Educational, Medical, &
Environmental Control
Facilities RB, PepsiCo Project
6.250%, 11/15/13 $2,750 $ 2,980
Puerto Rico Infrastructure
Financing Authority RB, AMBAC
5.250%, 07/01/10 2,500 2,638
Puerto Rico Municipal Finance
Agency RB, Series A, FSA
6.000%, 07/01/09 2,650 2,882
Puerto Rico Public Buildings
Authority RB, MBIA
5.000%, 07/01/11 1,000 1,028
--------
27,065
--------
Total Municipal Bonds
(Cost $176,285) 180,275
--------
Repurchase Agreement -- 3.0%
Paine Webber
4.800%, dated 05/28/99, matures
06/01/99, repurchase price
$5,611,881 (collateralized by
U.S. Treasury Instruments:
total market value
$5,721,179) (B) 5,609 5,609
--------
Total Repurchase Agreement
(Cost $5,609) 5,609
--------
Total Investments -- 99.0%
(Cost $181,893) 185,884
--------
Other Assets and Liabilities,
Net -- 1.0% 1,841
--------
58
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Description Value (000)
- --------------------------------------------------------------------------------
Net Assets:
Capital Shares (unlimited
authorization -- no par value)
based on 17,587,846 outstanding
shares of beneficial interest $182,859
Accumulated net realized gain
on investments 875
Net unrealized appreciation
on investments 3,991
--------
Total Net Assets -- 100.0% $187,725
========
Net Asset Value, Offering and
Redemption Price Per Share $ 10.67
========
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(A) Zero Coupon Bond. The rate reported on the Statement of Net Assets is the
effective yield as of May 31, 1999.
(B) Tri-Party Repurchase Agreement
AMT--Alternative Minimum Tax
GO--General Obligation Bond
RB--Revenue Bond
The following organizations have provided underlying credit support for the
securities as set forth in the Statement of Net Assets.
AMBAC--American Municipal Bond Assurance Corporation
CONLEE--College Construction Loan Insurance Association
FGIC--Financial Guaranty Insurance Corporation
FSA--Financial Security Assurance
GOA--General Obligation of Authority
GOI--General Obligation of Institution
MBIA--Municipal Bond Insurance Association
The accompanying notes are an integral part of the financial statements.
59
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Florida Tax-Exempt Income Fund
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
In the printed version of the document, a pie chart appears which depicts the
following plot points:
Participation Notes 1%
Transportation Bonds 9%
Public Facility Bonds 2%
Health Care Bonds 12%
Alternative Minimum Tax Bonds 4%
Housing Bonds 4%
Education Bonds 8%
Other Revenue Bonds 10%
Water & Sewer Bonds 17%
Cash Equivalents 7%
General Obligation Bonds 13%
Utility Bonds 13%
% of Total Portfolio Investments
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Municipal Bonds -- 92.4%
Florida -- 88.8%
Brevard County, Health Facility
Authority RB, Holmes Regional
Medical Center, MBIA
5.625%, 10/01/14 $1,000 $ 1,059
Brevard County, Housing &
Finance Authority RB,
Series B, FSA
7.000%, 03/01/13 220 230
Cape Coral, Water Improvement
RB, FSA
6.375%, 06/01/09 1,000 1,075
Dade County, Aviation RB, Series A
5.250%, 10/01/07 1,000 1,050
Dade County, Aviation RB,
Series A, AMT, MBIA
5.750%, 10/01/15 1,000 1,066
Dade County, Housing Finance
Authority RB, Series D, FSA
6.950%, 12/15/12 470 493
Dade County, Professional Sports
Franchise Facility RB, MBIA
5.250%, 10/01/12 1,385 1,427
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Dade County, Water & Sewer
System RB, FGIC
5.500%, 10/01/18 $3,000 $3,097
Escambia County, Housing
Finance Authority RB,
Series A, AMT, FHA
7.300%, 10/01/17 400 414
Florida State Board Educational
Lottery RB, Series C, FGIC
5.000%, 07/01/13 1,500 1,513
Florida State Board of Education
Capital Outlay GO, Series A
5.750%, 01/01/13 1,000 1,066
5.500%, 06/01/15 2,500 2,578
Florida State Board of Education
Capital Outlay GO,
Series B, MBIA
5.750%, 06/01/11 1,250 1,339
Florida State Board of
Education RB
5.125%, 07/01/11 1,170 1,202
Florida State Educational
Lottery RB, Series A
5.000%, 07/01/15 2,000 1,987
Florida State Finance
Department RB, MBIA
5.500%, 07/01/12 1,000 1,053
Florida State Finance
Department RB,
Series A, AMBAC
5.700%, 07/01/09 2,000 2,140
Florida State Gas Utilities
Project RB
5.000%, 12/01/08 1,000 1,043
Florida State Gulf
Breeze RB, FGIC
5.000%, 12/01/14 2,000 2,005
Florida State Housing
RB, MBIA
5.050%, 07/01/12 1,975 1,987
Florida State Turnpike
Authority RB, FGIC
5.250%, 07/01/11 2,000 2,053
Fort Lauderdale GO
5.500%, 07/01/15 1,000 1,025
60
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Florida (continued)
Gainesville, Utilities
System RB, Series B
5.500%, 10/01/13 $2,000 $2,075
Hillsborough County, Allegany
Health Systems RB, MBIA
6.375%, 12/01/12 1,300 1,427
Hillsborough County, Aviation
Authority, Tampa International
Airport RB, Series B, AMBAC
5.125%, 10/01/17 2,500 2,494
Indian Trace Community, Water
Management RB, MBIA
5.500%, 05/01/07 1,000 1,074
Lee County, Water & Sewer RB,
Series A, AMBAC
5.000%, 10/01/14 2,000 2,005
Manatee County, Florida School
Board COP, MBIA
4.950%, 07/01/14 1,000 993
Naples, Community Hospital
Project RB, MBIA
5.500%, 10/01/16 1,000 1,043
Orlando, Water & Electric
Utilities Commission RB
5.250%, 10/01/14 1,000 1,008
Pinellas County, Sewer RB, FGIC
5.000%, 10/01/13 1,990 2,007
Polk County, Utility
Systems RB, FGIC
5.250%, 10/01/17 1,500 1,513
Port St. Lucie, Special
Assessment, District 1, MBIA
5.850%, 10/01/11 3,070 3,285
Reedy Creek, Improvements GO,
Series A, MBIA
5.750%, 06/01/14 2,500 2,641
Sarasota County, Hospital
Facilities RB, Memorial Health
Systems Project, Series B, MBIA
5.000%, 10/01/10 1,250 1,280
Tampa Bay, Florida Water
Utility Systems RB,
Series B, FGIC
5.125%, 10/01/12 2,250 2,303
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Tampa Health Systems
Catholic Health RB, AMBAC
4.875%, 11/15/15 $1,000 $ 979
Tampa Health Systems
RB, AMBAC
4.875%, 11/15/14 1,000 984
Volusia County, Hospital
Facilities RB, Memorial
Health Systems Project,
AMBAC
5.500%, 11/15/16 1,250 1,298
Volusia County, Sales
Tax RB, MBIA
5.000%, 10/01/16 1,830 1,809
----------
61,120
----------
Puerto Rico -- 3.6%
Puerto Rico Commonwealth
Highway & Transportation
Authority RB, Sub- P R St
Infrastructure Bank, MBIA
5.250%, 07/01/13 1,375 1,423
Puerto Rico Industrial, Tourist,
Educational, Medical, &
Environmental Control
Facilities RB, International
American University,
Series A, MBIA
5.250%, 10/01/12 1,000 1,043
----------
2,466
----------
Total Municipal Bonds
(Cost $62,489) 63,586
----------
Repurchase Agreement -- 6.6%
Paine Webber
4.800%, dated 05/28/99, matures
06/01/99, repurchase price
$4,530,803 (collateralized by
U.S. Treasury Instruments: total
market value $4,619,045) (A) 4,528 4,528
----------
Total Repurchase Agreement
(Cost $4,528) 4,528
----------
61
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Florida Tax-Exempt Income Fund (concluded)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Description Value (000)
- --------------------------------------------------------------------------------
Total Investments -- 99.0%
(Cost $67,017) $68,114
----------
Other Assets and Liabilities,
Net -- 1.0% 682
----------
Net Assets:
Capital Shares (unlimited
authorization -- no par value)
based on 6,795,474 outstanding
shares of beneficial interest 67,699
Net unrealized appreciation
on investments 1,097
----------
Total Net Assets -- 100.0% $68,796
==========
Net Asset Value, Offering and
Redemption Price Per Share $10.12
==========
(A) Tri-Party Repurchase Agreement
AMT--Alternative Minimum Tax
GO--General Obligation Bond
RB--Revenue Bond
The following organizations have provided underlying credit support for the
securities as set forth in the Statement of Net Assets.
AMBAC--American Municipal Bond Assurance Corporation
FGIC--Financial Guaranty Insurance Corporation
FHA--Federal Housing Administration
FSA--Financial Security Assurance
MBIA--Municipal Bond Insurance Association
The accompanying notes are an integral part of
the financial statements.
62
<PAGE>
BOSTON 1784 FUNDS
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Massachusetts Tax-Exempt Income Fund
[GRAPHIC OMITTED]
In the printed version of the document, a pie chart appears which depicts the
following plot points:
Water & Sewer Bonds 9%
General Obligation Bonds 33%
Alternative Minimum Tax Bonds 4%
Health Care Bonds 14%
Housing Bonds 4%
Transportation Bonds 11%
Pre-Refunded Securities 3%
Education Bonds 11%
Utility Bonds 1%
Public Facility Bonds 1%
Resource Recovery Bonds 1%
Cash Equivalents 8%
% of Total Portfolio Investments
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Municipal Bonds -- 90.9%
Massachusetts -- 88.6%
Barnstable GO
5.000%, 03/15/12 $1,000 $ 1,010
Boston GO, Series A, AMBAC
5.650%, 02/01/09 1,500 1,582
Boston, Water and Sewer
Community RB, Series A, FGIC
5.125%, 11/01/15 3,320 3,328
Brockton GO, MBIA
5.125%, 04/01/15 1,500 1,511
Chelsea GO, School Loan
Project, AMBAC
6.000%, 06/15/04 650 707
5.700%, 06/15/06 1,000 1,079
Gloucester GO, FGIC
5.100%, 08/01/14 1,105 1,117
Haverhill GO, FGIC
5.300%, 06/15/12 1,500 1,549
Holyoke GO, FSA
5.200%, 08/01/17 690 696
Holyoke GO, Series A, FSA
5.600%, 06/15/11 1,000 1,059
5.500%, 06/15/16 1,195 1,237
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Lawrence GO, AMBAC
6.250%, 02/15/09 $1,475 $ 1,604
Lowell GO, AMBAC
5.500%, 08/01/11 2,740 2,863
5.500%, 08/01/12 1,720 1,802
Lowell GO, FSA
5.500%, 01/15/10 1,140 1,197
6.625%, 04/01/15 1,000 1,119
Lynn, Massachusetts Water &
Sewer Community RB,
Series A, FSA
5.000%, 12/01/14 1,375 1,370
Malden GO, AMBAC
5.000%, 10/01/14 1,000 1,002
Massachusetts Bay Transportation
Authority RB, GOA
5.500%, 03/01/07 1,500 1,613
6.000%, 03/01/12 4,000 4,311
Massachusetts State
Authority RB, Health &
Educational Facilities
Brandeis University Project,
Series I, MBIA
5.250%, 10/01/12 1,900 1,964
Massachusetts State Bay
Transportation Authority RB,
Series A, GOA
5.800%, 03/01/10 2,640 2,868
Massachusetts State Bay
Transportation Authority RB,
Series A, MBIA
5.000%, 03/01/18 3,000 2,929
5.750%, 03/01/18 710 762
Massachusetts State Bay
Transportation Authority RB,
Series A, MBIA (A)
5.750%, 03/01/18 2,615 2,857
Massachusetts State Bay
Transportation Authority RB,
Series D, GOA
5.600%, 03/01/08 1,885 2,036
Massachusetts State Development
Finance Agency,
Clark University RB
5.250%, 07/01/16 1,445 1,427
63
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Massachusetts Tax-Exempt Income Fund (continued)
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Massachusetts (continued)
Massachusetts State
Developmental Financial
Agency RB, Emerson College
Project, AMBAC
5.000%, 01/01/12 $1,455 $ 1,466
Massachusetts State Educational
Financing Authority RB,
Series A, AMT, MBIA
5.125%, 12/01/14 1,000 986
Massachusetts State Educational
Loan Authority RB, Issue E,
Series B, AMT, AMBAC
6.000%, 01/01/12 380 397
6.300%, 07/01/12 795 834
Massachusetts State Finance
Agency RB, Curry College,
Series A, ACA
5.000%, 03/01/13 1,640 1,615
Massachusetts State GO
5.250%, 05/01/12 1,000 1,033
5.250%, 05/01/14 1,000 1,024
5.250%, 08/01/14 5,000 5,106
5.000%, 11/01/14 2,000 2,002
Massachusetts State GO (A)
5.750%, 06/01/16 3,000 3,266
Massachusetts State GO, Series A
5.500%, 02/01/11 3,500 3,631
5.000%, 11/01/13 5,000 5,025
Massachusetts State GO,
Series A, MBIA
5.000%, 04/01/14 3,000 3,007
Massachusetts State GO, Series B
6.500%, 08/01/08 5,315 6,066
Massachusetts State GO,
Series B, FGIC
5.500%, 11/01/07 1,000 1,076
5.125%, 06/01/12 2,000 2,047
Massachusetts State GO,
Series B, FGIC (A)
5.875%, 08/01/10 2,000 2,195
Massachusetts State GO,
Series B, MBIA
5.400%, 11/01/07 2,000 2,140
Massachusetts State GO, Series C
5.250%, 08/01/15 1,750 1,783
5.000%, 08/01/17 2,000 1,957
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Massachusetts State Grant
Anticipation Note, Series A
5.250%, 12/15/11 $4,000 $ 4,145
Massachusetts State Health &
Educational Facilities
Authority RB, Amherst College,
Series G
5.250%, 11/01/15 1,125 1,136
Massachusetts State Health &
Educational Facilities
Authority RB, Baystate Medical
Center Project, Series D, FGIC
6.000%, 07/01/15 2,000 2,142
Massachusetts State Health &
Educational Facilities
Authority RB, Berklee College
of Music, Series E, MBIA
5.000%, 10/01/15 975 966
Massachusetts State Health &
Educational Facilities
Authority RB, Boston Medical
Center, Series A, MBIA
5.250%, 07/01/15 2,500 2,531
5.250%, 07/01/16 2,725 2,745
Massachusetts State Health &
Educational Facilities
Authority RB, Brandeis
University, MBIA
5.250%, 10/01/14 1,500 1,532
Massachusetts State Health &
Educational Facilities
Authority RB, Catholic
Health East, Series A, AMBAC
5.000%, 11/15/18 2,000 1,932
Massachusetts State Health &
Educational Facilities
Authority RB, Dana Farber
Cancer Project, Series G-1
6.250%, 12/01/09 1,175 1,278
Massachusetts State Health &
Educational Facilities
Authority RB, Emerson
Hospital Project,
Series D, FSA
5.800%, 08/15/18 3,000 3,116
64
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Massachusetts (continued)
Massachusetts State Health &
Educational Facilities
Authority RB, Eye & Ear
Hospital, Series B
5.250%, 07/01/09 $1,500 $ 1,551
Massachusetts State Health &
Educational Facilities
Authority RB, Hallmark
Health Systems, Series A, FSA
5.000%, 07/01/12 1,000 1,003
Massachusetts State Health &
Educational Facilities
Authority RB, Harvard Pilgrim
Health, Series A, FSA
5.000%, 07/01/14 2,500 2,478
Massachusetts State Health &
Educational Facilities
Authority RB, Harvard
University Project,
Series M, GOI
5.750%, 12/01/11 1,000 1,038
Massachusetts State Health &
Educational Facilities
Authority RB, Lahey Clinic
Medical Center Project,
Series B, MBIA
5.625%, 07/01/15 500 523
Massachusetts State Health &
Educational Facilities
Authority RB, Massachusetts
General Hospital,
Series G, AMBAC
5.375%, 07/01/11 2,000 2,050
Massachusetts State Health &
Educational Facilities
Authority RB, Newton-Wellesley
Hospital Project, Issue E, MBIA
5.875%, 07/01/15 3,000 3,195
Massachusetts State Health &
Educational Facilities
Authority RB, Partners
Healthcare System, Series B
5.250%, 07/01/10 4,670 4,804
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Massachusetts State Health &
Educational Facilities
Authority RB, Partners
Healthcare Systems,
Series A, MBIA
5.375%, 07/01/17 $2,465 $ 2,490
Massachusetts State Health &
Educational Facilities
Authority RB, Simmons College,
Series C, MBIA
5.000%, 10/01/14 1,000 996
Massachusetts State Health &
Educational Facilities
Authority RB, Smith College
Project, Series D, GOI
5.750%, 07/01/16 2,600 2,720
Massachusetts State Health &
Educational Facilities
Authority RB, Tufts University
Project, Series F, FGIC
5.950%, 08/15/18 3,000 3,169
Massachusetts State Health &
Educational Facilities
Authority RB, UMass Memorial
Issue, Series A, AMBAC
5.250%, 07/01/14 2,000 2,028
Massachusetts State Health &
Educational Facilities
Authority RB, Williams College,
Series F
5.750%, 07/01/19 1,000 1,036
Massachusetts State Health &
Educational Facilities Authority
RB, Partners Healthcare System
5.250%, 07/01/15 2,500 2,528
Massachusetts State Housing
Finance Agency RB, Rental
Mortgage, Series C, AMT, AMBAC
5.450%, 07/01/18 2,805 2,801
Massachusetts State Housing
Finance Agency RB, Residential
Development Project,
Series A, FNMA
6.875%, 11/15/11 1,750 1,890
65
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Massachusetts Tax-Exempt Income Fund (continued)
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Massachusetts (continued)
Massachusetts State Housing
Finance Agency RB,
Series A, AMBAC
6.300%, 10/01/13 $4,950 $ 5,241
Massachusetts State Housing
Finance Agency RB,
Series A, MBIA
5.850%, 12/01/08 1,245 1,323
6.100%, 07/01/15 1,590 1,685
Massachusetts State Housing
Finance Agency RB, Single
Family Housing Project,
Series 14, FHA
7.700%, 12/01/14 1,895 1,981
Massachusetts State Industrial
Finance Agency RB, Babson
College Project, Series A
5.375%, 10/01/17 1,000 1,005
Massachusetts State Industrial
Finance Agency RB, Babson
College Project, Series A, MBIA
6.375%, 10/01/09 1,000 1,096
5.750%, 10/01/15 1,000 1,058
Massachusetts State Industrial
Finance Agency RB, College
of Holy Cross, MBIA
5.500%, 03/01/16 1,500 1,545
Massachusetts State Industrial
Finance Agency RB, Worcester
Polytechnical Institution, MBIA
5.125%, 09/01/17 1,550 1,536
Massachusetts State Industrial
Finance Agency Resource
Recovery RB, Ogden Haverhill
Project A, AMT
5.200%, 12/01/08 1,500 1,498
Massachusetts State Municipal
Wholesale Electric
Company RB, Series D, MBIA
6.000%, 07/01/05 1,000 1,068
Massachusetts State Port
Authority RB, Series A, AMT
6.000%, 07/01/13 1,050 1,126
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Massachusetts State Port
Authority RB, Series B, AMT
5.000%, 07/01/13 $41,790 $ 1,783
5.250%, 07/01/14 1,385 1,402
Massachusetts State Port
Authority RB, Series E, AMT
5.250%, 07/01/13 1,000 1,016
Massachusetts State Resource
Recovery Authority RB,
Refusetech Project, Series A
6.150%, 07/01/02 900 938
6.300%, 07/01/05 1,000 1,068
Massachusetts State Special
Obligation RB, Series A
5.500%, 06/01/07 2,000 2,113
5.750%, 06/01/11 2,780 3,002
5.750%, 06/01/12 700 756
Massachusetts State Turnpike
Authority RB, Metropolitan
Highway System, Series A, MBIA
5.000%, 01/01/13 1,000 1,003
Massachusetts State Turnpike
Authority RB, Metropolitan
Highway System,
Sub-Series B, MBIA
5.250%, 01/01/17 1,000 1,005
Massachusetts State Turnpike
Authority RB, Western
Turnpike, Series A, MBIA
5.550%, 01/01/17 1,835 1,842
Massachusetts State Unlimited
Tax GO, Series D
5.000%, 11/01/11 5,000 5,069
Massachusetts State Water
Authority RB, Series B, MBIA
5.500%, 03/01/17 3,500 3,570
Massachusetts State Water
Pollution Abatement Trust RB,
Pooled Loan Program, Series 1
5.600%, 08/01/13 2,090 2,215
Massachusetts State Water
Pollution Abatement Trust RB,
Pooled Loan Program, Series 2
6.125%, 02/01/07 730 812
66
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Massachusetts (continued)
Massachusetts State Water
Pollution Abatement Trust RB,
Series A
5.450%, 02/01/13 $1,000 $ 1,043
5.250%, 08/01/14 1,000 1,016
Massachusetts State Water
Pollution RB
5.700%, 02/01/12 1,450 1,569
5.700%, 02/01/15 3,000 3,253
Massachusetts State Water
Resource Authority RB,
Series B, GOA
5.875%, 11/01/04 1,000 1,073
Massachusetts State Water
Resource Authority RB,
Series C, GOA
6.000%, 11/01/05 2,000 2,148
6.000%, 12/01/11 2,000 2,220
Mendon Upton Regional
School District GO, FGIC
5.500%, 06/01/15 1,405 1,466
5.500%, 06/01/17 1,500 1,553
Nantucket GO
6.800%, 12/01/11 1,425 1,546
Nantucket GO, MBIA
5.250%, 07/15/10 2,250 2,346
Northampton GO, MBIA
5.750%, 05/15/16 775 836
Palmer GO, MBIA
5.500%, 10/01/10 1,500 1,571
Peabody GO, Series A
5.000%, 08/01/13 310 313
5.000%, 08/01/14 510 512
Plymouth County, Partners
Correctional Facility
COP, AMBAC
5.125%, 10/01/13 2,165 2,195
Springfield GO, AMBAC
5.300%, 08/01/11 1,000 1,035
5.300%, 08/01/13 1,000 1,030
Springfield GO, FSA
5.000%, 09/01/11 1,885 1,909
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Springfield GO, State Qualified
Municipal Purpose Loan, FSA
5.250%, 11/15/11 $1,600 $ 1,660
University of Lowell Building
Authority RB, Fifth Series A,
AMBAC
5.625%, 11/01/14 3,000 3,158
Uxbridge GO, MBIA
5.400%, 11/15/16 750 769
West Springfield GO, FGIC
5.000%, 03/01/18 1,225 1,197
Worcester GO, Municipal
Purpose Loan Series B, MBIA
5.250%, 11/01/14 1,875 1,924
Worcester GO, Series G, MBIA
5.300%, 07/01/15 1,000 1,020
----------
237,196
----------
Puerto Rico -- 2.3%
Puerto Rico Commonwealth GO
5.000%, 07/01/08 1,710 1,774
Puerto Rico Commonwealth
GO, FSA
5.500%, 07/01/13 1,000 1,041
Puerto Rico Commonwealth
Highway & Transportation
Authority RB, Sub- P R St
Infrastructure Bank, MBIA
5.250%, 07/01/13 1,300 1,346
Puerto Rico Industrial, Tourist,
Educational, Medical, &
Environmental Control
Facilities RB, International
American University,
Series A, MBIA
5.250%, 10/01/12 1,000 1,043
Puerto Rico Refunding Public
Improvement GO
5.500%, 07/01/13 1,000 1,068
----------
6,272
----------
Total Municipal Bonds
(Cost $237,421) 243,468
----------
67
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Massachusetts Tax-Exempt Income Fund (concluded)
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Repurchase Agreement -- 8.0%
Paine Webber
4.800%, dated 05/28/99, matures
06/01/99, repurchase price
$21,360,902 (collateralized
by U.S. Treasury Instruments:
total market value
$21,776,928) (B) $21,350 $ 21,350
---------
Total Repurchase Agreement
(Cost $21,350) 21,350
---------
Total Investments -- 98.9%
(Cost $258,771) 264,818
---------
Other Assets and Liabilities,
Net-- 1.1% 3,053
---------
Net Assets:
Capital Shares (unlimited
authorization -- no par value)
based on 25,776,888 outstanding
shares of beneficial interest 261,898
Accumulated net realized loss
on investments (74)
Net unrealized appreciation
on investments 6,047
---------
Total Net Assets -- 100.0% $267,871
=========
Net Asset Value, Offering and
Redemption Price Per Share $10.39
=========
(A) Pre-refunded Security. The pre-refunded date is shown as the maturity
date on the Statement of Net Assets.
(B) Tri-Party Repurchase Agreement
AMT--Alternative Minimum Tax
COP--Certificate of Participation
GO--General Obligation Bond
RB--Revenue Bond
The following organizations have provided underlying credit support for the
securities as set forth in the Statement of Net Assets.
ACA--American Capital Access
AMBAC--American Municipal Bond Assurance Corporation
FGIC--Financial Guaranty Insurance Corporation
FHA--Federal Housing Administration
FNMA--Federal National Mortgage Association
FSA--Financial Security Assurance
GOA--General Obligation of Authority
GOI--General Obligation of Institution
MBIA--Municipal Bond Insurance Association
The accompanying notes are an integral part of the financial statements.
68
<PAGE>
BOSTON 1784 FUNDS
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Rhode Island Tax-Exempt Income Fund
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
In the printed version of the document, a pie chart appears which depicts the
following plot points:
Water & Sewer Bonds 4%
Industrial Development & Pollution Control Bonds 3%
Health Care Bonds 7%
Other Revenue Bonds 3%
Cash Equivalents 4%
Education Bonds 11%
Utility Bonds 7%
Housing Bonds 10%
Public Facility Bonds 9%
Alternative Minimum Tax Bonds 6%
Transportation Bonds 6%
General Obligation Bonds 30%
% of Total Portfolio Investments
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Municipal Bonds -- 95.7%
Rhode Island -- 79.9%
Bristol County, Water
Authority RB, MBIA
5.200%, 12/01/14 $1,000 $1,014
Bristol County, Water
Authority RB, Series A, MBIA
5.200%, 12/01/13 1,080 1,096
Central Falls RB,
Detention Facility
5.250%, 01/15/13 1,505 1,516
5.375%, 01/15/18 1,000 991
Central Falls RB, Detention
Facility, FSA
5.375%, 01/15/18 1,000 1,010
Cranston GO, MBIA
6.100%, 06/15/10 1,000 1,095
6.100%, 06/15/15 1,500 1,642
5.500%, 07/15/15 1,305 1,365
Cumberland GO, MBIA
5.100%, 09/01/14 500 506
Exeter West Greenwich
Regional School
District GO, MBIA
5.400%, 11/15/10 1,000 1,047
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Kent County, Water
Authority RB, MBIA
6.000%, 07/15/08 $ 500 $ 541
North Providence GO,
Series A, MBIA
6.000%, 07/01/12 1,100 1,207
6.050%, 07/01/13 500 549
Providence GO, FSA
5.050%, 01/15/05 1,090 1,135
5.100%, 01/15/06 1,085 1,134
Providence GO, Series A, FSA
5.700%, 07/15/12 1,825 1,941
Providence, Housing
Development Authority RB,
Barbara Jordan Apartments
Project, Series A, MBIA
6.500%, 07/01/09 395 424
Providence, Public Building
Authority GO, Series A, FSA
5.400%, 12/15/11 500 523
Providence, Public Building
Authority RB, FSA
5.250%, 12/15/14 1,500 1,537
Rhode Island State Airport
Economic Development RB
5.000%, 07/01/15 1,620 1,602
Rhode Island State Clean
Water Agency RB, Safe
Drinking Water Project,
Series A, AMBAC
6.500%, 01/01/09 500 554
Rhode Island State Clean
Water Agency RB, Water
Pollution Control, MBIA
5.875%, 10/01/15 435 470
Rhode Island State Clean Water
Agency RB, Water Pollution
Control, MBIA (A)
5.875%, 10/01/15 430 472
Rhode Island State Convention
Center Authority RB,
Series A, AMBAC
5.500%, 05/15/13 1,000 1,045
69
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Rhode Island Tax-Exempt Income Fund (continued)
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Rhode Island (continued)
Rhode Island State Depositor's
Economic Protection
Agency RB, Series A, FSA
6.500%, 08/01/07 $ 500 $ 569
Rhode Island State Depositor's
Economic Protection Agency RB,
Series B, MBIA
5.800%, 08/01/12 1,000 1,090
Rhode Island State Depositor's
Economic Protection
Agency RB, Special Obligation,
Series A, FSA
5.750%, 08/01/14 1,000 1,090
Rhode Island State GO
5.250%, 07/15/10 1,000 1,047
5.000%, 08/01/11 1,530 1,549
5.000%, 09/01/12 1,665 1,688
Rhode Island State GO, FGIC
5.000%, 09/01/14 2,680 2,687
5.000%, 09/01/16 2,425 2,395
Rhode Island State GO,
Reference Consolidation
Capital Development Loan,
Series A
5.125%, 07/15/13 3,000 3,060
Rhode Island State GO, Series A
5.125%, 07/15/12 1,735 1,776
Rhode Island State Health &
Educational Building RB
5.400%, 07/01/13 1,045 1,020
4.750%, 09/01/14 1,215 1,172
5.500%, 07/01/18 1,000 947
Rhode Island State Health &
Educational Building RB,
Brown University
5.000%, 09/01/15 1,000 983
5.000%, 09/01/16 1,000 979
5.000%, 09/01/17 1,000 971
Rhode Island State Health &
Educational Building RB,
Higher Education Facility,
AMBAC
5.125%, 11/15/14 2,000 2,015
5.000%, 11/15/18 1,000 968
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Rhode Island State Health &
Educational Building RB,
Higher Education Facility,
CONLEE
6.500%, 11/15/08 $ 180 $ 194
Rhode Island State Health &
Educational Building RB,
Kent Hospital Project, MBIA
7.000%, 07/01/10 500 535
Rhode Island State Health &
Educational Building RB,
Landmark Medical Project, FSA
5.600%, 10/01/12 2,000 2,083
Rhode Island State Health &
Educational Building RB,
New England Institutional
Project, CONLEE
5.900%, 03/01/10 400 421
Rhode Island State Health &
Educational Building RB,
Rhode Island School of
Design, MBIA
5.625%, 06/01/16 2,000 2,108
Rhode Island State Health &
Educational Building RB,
Roger Williams Hospital Project
7.750%, 07/01/16 1,000 1,047
5.250%, 11/15/16 1,000 1,004
Rhode Island State Housing &
Mortgage Finance RB
5.550%, 04/01/17 500 505
Rhode Island State Housing &
Mortgage Finance RB,
Series 13
6.700%, 10/01/15 2,000 2,115
Rhode Island State Housing &
Mortgage Finance RB,
Series 19A
5.700%, 04/01/15 1,500 1,528
Rhode Island State Housing &
Mortgage Finance RB, Series 2
7.700%, 10/01/10 500 516
Rhode Island State Housing &
Mortgage Finance RB,
Series 27-B, AMT
5.150%, 10/01/12 2,240 2,218
70
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Rhode Island (continued)
Rhode Island State Housing &
Mortgage Finance RB,
Series 30-A
4.900%, 10/01/14 $2,000 $ 1,970
Rhode Island State Housing &
Mortgage Finance RB,
Series 7B, AMT
6.700%, 10/01/12 750 792
Rhode Island State Housing &
Mortgage Finance RB,
Series A, LOC
5.650%, 10/01/07 1,000 1,033
Rhode Island State Housing &
Mortgage Finance RB,
Series E-1, AMT, FHA
7.500%, 10/01/11 905 948
Rhode Island State Industrial
Facilities RB
6.000%, 11/01/14 2,250 2,430
Rhode Island State Industrial
Facilities RB, AMT, LOC
6.500%, 03/01/14 500 528
Rhode Island State Port
Authority & Economic
Development RB, Shepard
Building Project, Series B,
AMBAC (A)
6.500%, 06/01/08 500 561
Rhode Island State Public
Projects RB, Series A
5.250%, 02/01/10 1,000 1,044
Rhode Island State Student
Loan Authority RB,
Series B, AMT
7.000%, 12/01/04 1,390 1,472
Rhode Island State Student Loan
Authority RB,
Series B, AMT, LOC
6.850%, 12/01/02 500 529
Rhode Island State Turnpike &
Bridge Authority RB
5.000%, 12/01/11 1,000 991
5.350%, 12/01/17 2,130 2,130
Rhode Island Water Protection
Finance Agency RB, MBIA
6.750%, 10/01/13 25 27
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Warwick GO, Series A, FGIC
5.000%, 03/01/15 $1,180 $ 1,176
5.000%, 03/01/16 1,205 1,193
-------
81,520
-------
Guam -- 1.0%
Guam Power Authority RB
5.250%, 10/01/11 1,000 1,042
-------
Puerto Rico -- 14.8%
Puerto Rico Commonwealth GO
5.750%, 07/01/17 1,000 1,066
Puerto Rico Commonwealth
GO (B)
5.013%, 07/01/14 3,500 1,649
Puerto Rico Electric Power
Authority RB
5.250%, 07/01/14 3,000 3,109
5.500%, 07/01/16 3,000 3,105
Puerto Rico Highway &
Transportation Authority RB,
Series V
6.375%, 07/01/07 1,135 1,209
Puerto Rico Industrial, Medical &
Environmental Pollution
Control RB, PepsiCo
Project, Series A
6.250%, 11/15/13 500 541
Puerto Rico Industrial, Tourist,
Educational, Medical, &
Environmental Control
Facilities RB, International
American University,
Series A, MBIA
5.250%, 10/01/12 360 375
5.375%, 10/01/13 1,550 1,622
5.500%, 10/01/14 350 369
Puerto Rico Public Education &
Health Facilities RB,
Series M, CGTD
5.750%, 07/01/15 2,000 2,087
-------
15,132
-------
Total Municipal Bonds
(Cost $95,835) 97,694
-------
71
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Rhode Island Tax-Exempt Income Fund (concluded)
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Repurchase Agreement -- 4.0%
Paine Webber
4.800%, dated 05/28/99, matures
06/01/99, repurchase price
$4,065,003 (collateralized by
U.S. Treasury Instruments:
total market value
$4,144,173) (C) $4,063 $ 4,063
--------
Total Repurchase Agreement
(Cost $4,063) 4,063
--------
Total Investments -- 99.7%
(Cost $99,898) 101,757
--------
Other Assets and Liabilities,
Net -- 0.3% 316
--------
Net Assets:
Capital Shares (unlimited
authorization -- no par value)
based on 9,722,031 outstanding
shares of beneficial interest 100,077
Accumulated net realized gain
on investments 137
Net unrealized appreciation
on investments 1,859
--------
Total Net Assets -- 100.0% $102,073
========
Net Asset Value, Offering and
Redemption Price Per Share $ 10.50
========
(A) Pre-refunded Security. The pre-refunded date is shown as the maturity date
on the Statement of Net Assets.
(B) Zero Coupon Bond. The rate reported on the Statement of Net Assets is the
effective yield as of May 31,1999.
(C) Tri-Party Repurchase Agreement
AMT--Alternative Minimum Tax
GO--General Obligation Bond
LOC--Securities are held in connection with a letter of credit issued by a major
commercial bank or other financial institution.
RB--Revenue Bond
The following organizations have provided underlying credit support for the
securities set forth in the Statement of Net Assets.
AMBAC--American Municipal Bond Assurance Corporation
CGTD--Commonwealth Guaranteed
CONLEE--College Construction Loan Insurance Association
FGIC--Financial Guaranty Insurance Corporation
FHA--Federal Housing Administration
FSA--Financial Security Assurance
MBIA--Municipal Bond Insurance Assurance
The accompanying notes are on integral part of the finanical statements.
72
<PAGE>
BOSTON 1784 FUNDS
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Asset Allocation Fund
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
In the printed version of the document, a pie chart appears which depicts the
following plot points:
U.S. Treasury Obligations 10%
U.S. Government Agency Obligations 6%
Cash Equivalents 4%
Common Stock 54%
Preferred Stock 1%
Asset-Backed Securities 3%
Corporate Bonds 14%
U.S Mortgage-Backed Bonds 8%
% of Total Portfolio Investments
- --------------------------------------------------------------------------------
Description Shares Value (000)
- --------------------------------------------------------------------------------
Common Stocks -- 53.5%
Aerospace & Defense -- 0.6%
Allied Signal 1,900 $ 110
General Motors Class H 4,200 230
------
340
------
Air Transportation -- 0.3%
AMR* 2,700 176
------
Automotive -- 0.2%
Rockwell International 1,900 105
------
Banks -- 1.1%
Bank of America 8,600 556
------
Beauty Products -- 1.6%
Colgate-Palmolive 2,200 220
Procter & Gamble 6,750 630
------
850
------
Broadcasting, Newspapers &
Advertising -- 2.8%
AT&T-Liberty Media, Class A* 5,850 389
Comcast, Class A 9,400 362
Mediaone Group* 3,400 251
- --------------------------------------------------------------------------------
Description Shares Value (000)
- --------------------------------------------------------------------------------
Omnicom Group 2,850 $ 199
Telewest Comm Plc-Spons ADR* 4,550 197
Univision Communications,
Class A* 1,750 104
------
1,502
------
Capital Goods/Construction -- 3.3%
Alcoa 750 41
Dii Group Inc* 7,600 250
General Electric 7,850 798
Mannesmann AG
Sponsored ADR* 800 110
Molex 5,500 168
Southdown 1,800 114
Tyco International 3,100 271
------
1,752
------
Chemicals -- 0.2%
Air Products & Chemicals 2,750 113
------
Drugs -- 2.0%
Centocor* 4,600 200
Medimmune* 1,900 121
Pfizer 2,550 273
Schering Plough 1,250 56
SmithKline Beecham ADR 3,150 207
Warner-Lambert 3,200 198
------
1,055
------
Electrical Services -- 0.3%
AES* 3,300 164
------
Energy -- 4.2%
Baker Hughes 16,200 504
El Paso Natural Gas 4,800 173
Exxon 4,200 335
Mobil 6,000 607
Schlumberger 10,000 602
------
2,221
------
Entertainment -- 0.6%
Time Warner 4,950 337
------
Financial Services -- 3.7%
American Express 1,300 158
Equitable 4,900 344
73
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Asset Allocation Fund (continued)
- --------------------------------------------------------------------------------
Description Shares Value (000)
- --------------------------------------------------------------------------------
Financial Services (continued)
Fannie Mae 5,500 $ 374
Wells Fargo 26,700 1,068
------
1,944
------
Food, Beverage &
Tobacco -- 1.7%
Coca Cola 3,000 205
Nestle, ADR 7,800 703
------
908
------
Health Care -- 4.7%
Cardinal Health 3,500 211
Genzyme* 13,200 535
Johnson & Johnson 9,500 880
Merck 13,200 891
------
2,517
------
Insurance -- 5.3%
Aflac 2,350 120
Allstate 12,300 448
American International Group 12,800 1,463
Citigroup 7,000 464
Unum 3,150 170
XL Capital, Class A 2,900 176
------
2,841
------
Leisure -- 0.2%
Mattel 4,500 119
------
Lumber & Wood
Products -- 0.4%
Georgia Pacific 700 61
Weyerhaeuser 2,300 143
------
204
------
Medical Products &
Services -- 2.7%
Allergan 1,250 116
Boston Scientific* 17,600 668
Elan, ADR* 7,050 381
Medtronic 3,950 280
------
1,445
------
- --------------------------------------------------------------------------------
Description Shares Value (000)
- --------------------------------------------------------------------------------
Miscellaneous Business
Services -- 1.2%
America Online* 1,200 $ 143
DST Systems* 5,500 297
Electronic Data Systems
Corporation 3,300 186
------
626
------
Retail -- 3.8%
Circuit City 1,900 136
Costco* 4,900 355
CVS 7,600 350
Estee Lauder 2,800 255
Home Depot 3,550 202
Kroger* 3,600 211
Lowe's Companies 2,500 130
Wal-Mart Stores 9,600 409
------
2,048
------
Technology -- 6.9%
Analog Devices* 8,000 307
Cisco Systems* 4,350 474
Computer Associates
International 7,400 350
IBM 3,400 395
Intel 4,400 238
Lucent Technologies 19,700 1,120
Microsoft* 4,350 351
Motorola 3,000 248
Texas Instruments 450 49
Vitesse Semiconductor* 2,450 135
------
3,667
------
Telephones &
Telecommunications -- 4.2%
ADC Telecommunications* 2,200 108
Alltel 3,350 240
Centurytel 4,950 190
MCI WorldCom* 3,000 259
Nippon Telegraph & Telephone* 3,900 190
NTL* 3,600 340
SBC Communications 14,000 716
Sprint 1,850 209
------
2,252
------
74
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
Description Shares/Par(000) Value (000)
- --------------------------------------------------------------------------------
Wholesale -- 1.5%
Safeway* 3,500 $ 163
Sysco 21,100 626
------
789
------
Total Common Stocks
(Cost $20,203) 28,531
------
Preferred Stocks -- 0.4%
Hartford Capital II 8 210
------
Total Preferred Stocks
(Cost $200) 210
------
U.S. Treasury Obligations -- 10.0%
U.S. Treasury Bonds
7.250%, 05/15/16 $ 1,100 1,229
7.125%, 02/15/23 300 338
6.125%, 11/15/27 310 313
5.250%, 11/15/28 390 353
U.S. Treasury Notes
5.500%, 04/15/00 200 201
6.250%, 05/31/00 500 505
6.125%, 07/31/00 400 404
6.125%, 09/30/00 590 596
5.625%, 11/30/00 365 366
5.750%, 11/30/02 275 276
5.500%, 05/31/03 750 745
------
Total U.S. Treasury Obligations
(Cost $5,353) 5,326
------
U.S. Government
Mortgage-Backed Bonds -- 8.0%
Federal Home Loan Mortgage
Corporation
5.750%, 03/15/09 500 482
6.000%, 11/01/28 2,464 2,345
Federal National Mortgage
Association
6.000%, 06/01/13 1,164 1,135
- --------------------------------------------------------------------------------
Description Par(000) Value (000)
- --------------------------------------------------------------------------------
Government National Mortgage
Association
6.000%, 04/15/13 $229 $ 224
7.500%, 06/15/23 102 105
------
Total U.S. Government
Mortgage-Backed Bonds
(Cost $4,417) 4,291
------
Corporate Bonds -- 14.3%
Banks -- 1.7%
Chase Manhattan
6.500%, 01/15/09 300 291
Citicorp
6.375%, 11/15/08 300 293
First Union
7.500%, 07/15/06 315 327
------
911
------
Capital Goods/Construction -- 0.9%
Hydro-Quebec, YB
8.625%, 05/20/02 220 233
Province of Ontario, YB
7.375%, 01/27/03 220 228
------
461
------
Communications Equipment -- 0.8%
Lucent Technologies
5.500%, 11/15/08 215 200
Tele Communications
9.800%, 02/01/12 200 251
------
451
------
Entertainment -- 0.5%
Time Warner Entertainment
10.150%, 05/01/12 210 264
------
Financial Services -- 3.3%
Chase Manhattan
8.000%, 06/15/99 200 200
Citigroup
5.800%, 03/15/04 220 214
75
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Asset Allocation Fund (concluded)
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Financial Services (continued)
Ford Motor Credit
6.625%, 06/30/03 $425 $ 428
6.750%, 05/15/05 100 100
General Motors Acceptance
6.625%, 10/01/02 200 202
6.150%, 04/05/07 245 239
J.P. Morgan
6.000%, 01/15/09 400 376
------
1,759
------
Industrial -- 3.1%
Burlington North
9.250%, 10/01/06 250 282
Ford Motor
7.250%, 10/01/08 250 258
Northrop Grumman
7.000%, 03/01/06 250 248
Sears Roebuck
6.250%, 01/15/04 500 496
Trans-Canada Pipelines, YB
9.125%, 04/20/06 310 350
------
1,634
------
Paper & Paper Products -- 0.7%
Fort James
6.875%, 09/15/07 360 363
------
Petroleum & Fuel Products -- 0.5%
Atlantic Richfield
5.900%, 04/15/09 100 95
Enron Oil & Gas
6.000%, 12/15/08 215 200
------
295
------
Printing & Publishing -- 0.5%
News America
6.625%, 01/09/08 275 267
------
Retail -- 1.4%
Gap
6.900%, 09/15/07 260 266
Staples
7.125%, 08/15/07 200 201
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Wal-Mart Eurobond
6.750%, 05/24/02 $260 $ 265
------
732
------
Telephones &
Telecommunications -- 0.9%
AT&T
6.500%, 03/15/29 200 186
Cable & Wireless
Communication
6.375%, 03/06/03 100 99
Worldcom
6.125%, 08/15/01 220 219
------
504
------
Total Corporate Bonds
(Cost $7,881) 7,641
------
Asset-Backed Securities -- 3.0%
PNC Student Loan Trust I,
Series 1997-2, Class A6
6.572%, 01/25/04 600 599
Sears Credit Account
Master Trust, Series 1996-4,
Class A
6.450%, 10/16/06 500 499
Sears Credit Account
Master Trust, Series 1997-1,
Class A
6.200%, 07/16/07 500 490
------
Total Asset-Backed Securities
(Cost $1,594) 1,588
------
U.S. Government Agency
Obligations -- 6.0%
Federal Home Loan Bank
5.800%, 09/02/08 250 241
Federal National Mortgage
Association
5.750%, 04/15/03 500 496
6.500%, 03/01/11 355 354
6.500%, 05/01/28 878 858
76
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
U.S. Government Agency
Obligations (continued)
Federal National Mortgage
Association, MTN
7.070%, 06/25/01 $ 500 $ 501
7.240%, 01/04/07 500 503
Private Export Funding
Corporation
8.400%, 07/31/01 25 26
Tennessee Valley Authority
Principal STRIPS (A)
4.337%, 04/15/42 500 222
-------
Total U.S. Government Agency
Obligations
(Cost $3,182) 3,201
-------
Repurchase Agreement -- 4.2%
Paine Webber
4.800%, dated 05/28/99, matures
06/01/99, repurchase price
$2,267,670 (collateralized by
U.S. Treasury Instruments:
total market value
$2,311,835) (B) 2,266 2,266
-------
Total Repurchase Agreement
(Cost $2,266) 2,266
-------
Total Investments -- 99.4%
(Cost $45,096) 53,054
-------
Other Assets and Liabilities,
Net -- 0.6% 317
-------
- --------------------------------------------------------------------------------
Description Value (000)
- --------------------------------------------------------------------------------
Net Assets:
Capital Shares (unlimited
authorization -- no par value)
based on 3,565,816 outstanding
shares of beneficial interest $44,500
Undistributed net investment income 293
Accumulated net realized gain
on investments 620
Net unrealized appreciation
on investments 7,958
-------
Total Net Assets -- 100.0% $53,371
=======
Net Asset Value, Offering and
Redemption Price Per Share $ 14.97
=======
* Non-income producing security
(A) Zero Coupon Security. The rate reported on the Statement of Net Assets is
the effective yield as of May 31,1999.
(B) Tri-Party Repurchase Agreement
ADR--American Depository Receipt
MTN--Medium Term Note
STRIPS--Separately Traded Registered Interest and Principal Securities
YB--Yankee Bond
The accompanying notes are an integral part of the financial statements.
77
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
Boston 1784 Growth and Income Fund
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
In the printed version of the document, a pie chart appears which depicts the
following plot points:
Capital Goods/Machinery 2%
Cash Equivalents 4%
Telephones & Telecommunications 2%
Technology 18%
Retail 12%
Restaurants 6%
Office Equipment 2%
Medical Products & Services 11%
Insurance 2%
Household Products 4%
Healthcare 11%
Financial Services 5%
Environmental Services 2%
Entertainment 4%
Energy 10%
Consumer Non-Durables 2%
Consumer Durables 3%
% of Total Portfolio Investments
- --------------------------------------------------------------------------------
Description Shares Value (000)
- --------------------------------------------------------------------------------
Common Stocks -- 96.2%
Capital Goods/Machinery -- 1.5%
General Electric 80,000 $ 8,135
-------
Computers & Services -- 2.1%
EMC* 30,000 2,989
Equant-NY Registered
Shares (NL)* 100,000 8,294
-------
11,283
-------
Consumer Durables -- 2.9%
Cintas 250,000 15,875
-------
Consumer Non-Durables -- 2.0%
Coca Cola 160,000 10,930
-------
Containers & Packaging -- 1.8%
Newell Rubbermaid 250,000 10,125
-------
Drugs -- 2.3%
Warner-Lambert 200,000 12,400
-------
- --------------------------------------------------------------------------------
Description Shares Value (000)
- --------------------------------------------------------------------------------
Energy -- 8.3%
Chevron 60,000 $ 5,561
Enron 250,000 17,844
Exxon 150,000 11,981
Mobil 100,000 10,125
-------
45,511
-------
Entertainment -- 2.5%
Time Warner 50,000 3,403
Walt Disney 360,000 10,485
-------
13,888
-------
Environmental Services -- 2.2%
Rentokil Initial (UK) 3,000,000 12,159
-------
Financial Services -- 4.8%
Fifth Third Bancorp 200,000 13,637
Firstar 450,000 12,966
-------
26,603
-------
Gas/Natural Gas -- 1.9%
The Williams Companies 200,000 10,362
-------
Health Care -- 11.7%
Abbott Laboratories 200,000 9,037
Cardinal Health 150,000 9,056
Eli Lilly 150,000 10,716
Johnson & Johnson 120,000 11,115
Omnicare 450,000 10,772
Pfizer 125,000 13,375
-------
64,071
-------
Household Products -- 1.7%
Maytag 135,000 9,526
-------
Insurance -- 2.6%
American International Group 125,000 14,289
-------
Media -- 1.5%
The News Corp ADR (AU) 250,000 8,297
-------
Medical Products & Services -- 8.7%
Biomet 200,000 7,987
Guidant 300,000 15,000
Medtronic 350,000 24,850
-------
47,837
-------
78
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
Description Shares Value (000)
- --------------------------------------------------------------------------------
Office Equipment -- 1.6%
Xerox 160,000 $ 8,990
--------
Restaurants -- 6.4%
J.D. Wetherspoon (UK) 3,525,000 17,665
Outback Steakhouse* 105,000 3,767
PizzaExpress (UK) 935,000 13,944
--------
35,376
--------
Retail -- 12.2%
Bed Bath & Beyond* 600,000 20,512
GrandVision (FR) 274,500 7,471
Home Depot 500,000 28,438
Staples* 375,000 10,781
--------
67,202
--------
Technology -- 15.7%
Cisco Systems* 200,000 21,800
Intel 380,000 20,544
Microsoft* 440,000 35,503
Texas Instruments 75,000 8,203
--------
86,050
--------
Telephones &
Telecommunications -- 1.8%
AT&T 150,000 8,325
MCI WorldCom* 15,000 1,296
--------
9,621
--------
Total Common Stocks
(Cost $298,094) 528,530
--------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Repurchase Agreement -- 3.7%
Paine Webber
4.80%, dated 05/28/99, matures
6/1/99, repurchase price
$20,523,137 (collateralized
by U.S. Treasury Instruments:
total market value
$20,922,846) (A) $20,512 $ 20,512
--------
Total Repurchase Agreement
(Cost $20,512) 20,512
--------
Total Investments -- 99.9%
(Cost $318,606) $549,042
--------
Other Assets and Liabilities,
Net -- 0.1% 374
--------
Net Assets:
Capital Shares (unlimited
authorization -- no par value)
based on 24,783,850 outstanding
shares of beneficial interest 277,966
Accumulated net realized gain
on investments 41,014
Net unrealized appreciation
on investments 230,436
--------
Total Net Assets -- 100.0% $549,416
========
Net Asset Value, Offering and
Redemption Price Per Share $ 22.17
========
* Non-income producing security
(A) Tri-Party Repurchase Agreements
ADR--American Depository Receipt
AU--Australian Equity
FR--French Equity
NL--Netherlands Equity
UK--United Kingdom Equity
The accompanying notes are an integral part of the financial statements.
79
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
BOSTON 1784 GROWTH FUND
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
In the printed version of the document, a pie chart appears which depicts the
following plot points:
Chemicals 2%
Computer Equipment and Services 16%
Consumer Durables 9%
Data Processing & Management 4%
Drugs 2%
Environmental Services 2%
Financial Services 5%
Health Care 4%
Leasing & Renting 1%
Medical Products & Services 8%
Miscellaneous Business Services 3%
Restaurants 10%
Retail 11%
Technology 13%
Telephones & Telecommunications 3%
Television Broadcasting 2%
Cash Equivalents 5%
% of Total Portfolio Investments
- --------------------------------------------------------------------------------
Description Shares Value (000)
- --------------------------------------------------------------------------------
Common Stocks -- 94.7%
Chemicals -- 1.9%
MacDermid 90,000 $ 3,622
---------
Communications Equipment -- 1.4%
American Tower, Class A* 115,000 2,587
---------
Computer Equipment & Services -- 16.2%
Brocade Communications
Systems* 500 32
Computer Network
Technology* 100,000 2,525
Cree Research* 52,500 2,891
Cypress Semiconductor* 175,000 1,947
Data General* 150,000 1,969
Emulex* 200,000 15,750
New Era of Networks* 80,000 3,560
Rambus* 10,000 775
Semtech 15,000 627
---------
30,076
---------
Consumer Durables -- 8.6%
Cintas 80,000 5,080
Danaher 100,000 6,044
- --------------------------------------------------------------------------------
Description Shares Value (000)
- --------------------------------------------------------------------------------
Jakks Pacific* 115,000 $ 3,184
Miller Herman 80,000 1,615
---------
15,923
---------
Data Processing & Management -- 4.5%
Concord EFS* 125,000 4,234
TSI International Software* 184,000 4,071
---------
8,305
---------
Drugs -- 2.4%
Millennium Pharmaceutical* 70,000 2,651
PharmaPrint* 225,000 1,730
---------
4,381
---------
Environmental Services -- 1.7%
Rentokil Initial (UK) 800,000 3,242
---------
Financial Services -- 5.4%
Fifth Third Bancorp 50,000 3,409
Firstar 127,800 3,682
Litchfield Financial 178,500 2,901
---------
9,992
---------
Health Care -- 4.2%
Omnicare 133,400 3,193
Sabratek* 150,000 3,394
World Heart* 100,000 1,156
---------
7,743
---------
Leasing & Renting -- 0.8%
Comdisco 60,000 1,462
---------
Media -- 0.4%
Source Media* 50,000 825
---------
Medical Products & Services -- 8.1%
Biomet 75,000 2,995
Guidant 100,000 5,000
Medtronic 41,289 2,932
Renal Care Group* 150,000 4,162
---------
15,089
---------
80
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Description Shares Value (000)
- --------------------------------------------------------------------------------
Miscellaneous Business Service -- 2.7%
VeriSign* 37,000 $ 4,385
WebTrends* 20,000 573
---------
4,958
---------
Restaurants -- 10.0%
Buca Inc* 2,000 35
J.D. Wetherspoon (UK) 2,500,000 12,528
P.F Changs China Bistro* 58,000 1,465
PizzaExpress (UK) 310,000 4,623
---------
18,651
---------
Retail -- 11.2%
Bebe Stores* 53,000 1,529
Bed Bath & Beyond* 200,000 6,838
Dollar Tree Stores* 75,000 2,522
Fastenal 80,000 4,100
GrandVision (FR) 100,000 2,722
Guitar Center* 200,000 3,050
---------
20,761
---------
Technology -- 12.4%
Legato Systems* 90,000 4,928
QLogic* 165,000 18,109
---------
23,037
---------
Telephones & Telecommunications -- 1.6%
RCN* 70,000 2,909
---------
Television Broadcasting -- 1.2%
Univision Communications,
Class A* 36,000 2,135
---------
Total Common Stocks
(Cost $120,157) 175,698
---------
- --------------------------------------------------------------------------------
Description Par (000) Value (000)
- --------------------------------------------------------------------------------
Repurchase Agreement -- 4.7%
Paine Webber, 4.80%, dated 05/28/99,
matures 6/1/99, repurchase
price $8,667,651 (collateralized
by U.S. Treasury Instruments:
total market value
$8,836,463) (A) $8,663 $ 8,663
---------
Total Repurchase Agreement
(Cost $8,663) 8,663
---------
Total Investments -- 99.4%
(Cost $128,820) 184,361
---------
Other Assets and Liabilities,
Net -- 0.6% 1,115
---------
Net Assets:
Capital Shares (unlimited
authorization -- no par value)
based on 15,377,172 outstanding
shares of beneficial interest 125,178
Accumulated net investment loss (8)
Accumulated net realized gain
on investments 4,765
Net unrealized appreciation
on investments 55,541
---------
Total Net Assets-- 100.0% $185,476
---------
---------
Net Asset Value, Offering and
Redemption Price Per Share $12.06
---------
---------
* Non-income producing security
(A) Tri-Party Repurchase Agreements
FR--French Equity
UK--United Kingdom Equity
The accompanying notes are an integral part of the financial statements.
81
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
BOSTON 1784 INTERNATIONAL EQUITY FUND
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
In the printed version of the document, a pie chart appears which depicts the
following plot points:
Australia 2%
Canada 4%
Cash Equivalents 5%
Finland 4%
France 15%
Germany 4%
Israel 1%
Japan 20%
Netherlands 5%
Other Europe 12%
Other Far East 4%
Other North & South America 5%
United Kingdom 19%
% of Total Portfolio Investments
- --------------------------------------------------------------------------------
Description Shares Value (000)
- --------------------------------------------------------------------------------
Foreign Common Stocks -- 91.0%
Australia -- 2.5%
Australia & New Zealand
Banking Group 565,000 $ 4,097
Broken Hill Proprietary 543,000 5,569
---------
9,666
---------
Brazil -- 0.5%
Aracruz Celulose ADR 100,000 1,925
---------
Canada -- 3.8%
George Weston Limited 63,000 2,598
Loblaw 113,000 2,973
Shaw Communications,
Series B 76,000 2,967
The Toronto Dominion Bank 122,000 6,444
---------
14,982
---------
Finland -- 3.4%
Nokia 159,948 11,380
UPM-Kymmene 71,000 2,081
---------
13,461
---------
- --------------------------------------------------------------------------------
Description Shares Value (000)
- --------------------------------------------------------------------------------
France -- 14.6%
Alstom* 138,000 $ 4,076
Axa 41,336 4,765
Banque National de Paris 52,000 4,383
Canal Plus 15,700 4,545
Cap Gemini 48,889 7,043
Carrefour 18,000 2,362
Elf Aquitane 19,000 2,751
Groupe Danone 15,700 4,324
Sanofi-Synthelabo 162,713 6,858
STMicroelectronics ADR 61,100 7,095
Total, Series B* 39,200 4,764
Vivendi 54,000 4,000
Vivendi Rights 54,000 56
---------
57,022
---------
Germany -- 2.5%
Mannesmann 72,700 9,935
---------
Hong Kong -- 1.6%
Cosco Pacific 3,200,000 1,888
HSBC Holdings 132,000 4,324
---------
6,212
---------
Ireland -- 2.7%
Bank of Ireland 198,629 3,678
CRH 213,972 3,655
Jefferson Smurfit Group 1,194,000 3,112
---------
10,445
---------
Israel -- 1.1%
Gilat Satellite Networks ADR* 78,000 4,114
---------
Italy -- 2.1%
Alleanza Assicurazioni 350,000 3,925
Mediaset 502,300 4,071
---------
7,996
---------
Japan -- 19.9%
Aeon Credit Service 29,700 2,318
Aiful 37,200 3,304
Chugai Pharmaceutical 215,000 2,412
Fujitsu 616,000 10,234
Funai Electric* 16,500 2,036
Kao 202,000 5,516
82
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Description Shares Value (000)
- --------------------------------------------------------------------------------
Kokusai Securities 193,000 $ 2,156
Matsushita Communications 45,000 2,872
Matsushita Electric 230,000 4,143
Mycal Card 32,200 1,083
Nippon System Development 46,600 2,142
Nippon Telegraph &
Telephone 473 4,590
NTT Mobile Communication
Network 173 9,405
Ryohin Keikaku 16,000 3,131
Secom 32,000 3,027
Shin-Etsu Chemical 202,000 6,230
Softbank 65,300 7,465
Sony 33,000 3,083
Yahoo Japan* 12 2,448
---------
77,595
---------
Mexico -- 1.5%
Telefonos de Mexico ADR,
Series L 71,000 5,676
---------
Netherlands -- 4.6%
Ahold 137,000 4,781
Benckiser, Series B 126 6
Equant-NY Registered Shares* 32,600 2,704
Getronics 883 34
Heineken 75,400 4,192
KPN 50,000 2,415
Philips Electronics* 22,080 1,981
Randstad Holding 45,800 1,918
---------
18,031
---------
Norway -- 0.9%
Tomra Systems 91,122 3,428
---------
Poland -- 0.0%
Mostostal-Export 2,740 3
---------
Portugal -- 1.0%
Banco Comercial Portugues 141,372 3,849
---------
South Korea -- 1.1%
Housing & Commercial
Bank GDR 166,000 4,461
---------
- --------------------------------------------------------------------------------
Description Shares Value (000)
- --------------------------------------------------------------------------------
Spain -- 2.4%
Banco Santander Central
Hispano 140,325 $ 2,928
Centros Comerciales
Continente 114,000 2,777
Telefonica* 75,464 3,620
---------
9,325
---------
Sweden -- 1.9%
Ericsson, Series B 143,000 3,819
Nordbanken Holding 567,000 3,497
---------
7,316
---------
Switzerland -- 1.7%
Roche Holding-Genusscheine 365 3,862
UBS-Registered 10,200 2,952
---------
6,814
---------
Taiwan -- 0.8%
Taiwan Semiconductor ADR 117,000 3,064
---------
United Kingdom -- 18.9%
Abbey National 95,000 1,956
Airtours 398,000 3,273
Allied Zurich 499,000 6,370
Bank of Scotland 311,300 4,338
Barclays 145,044 4,333
BOC Group 125,000 2,141
BP Amoco 254,000 4,546
British Telecommunications 458,878 7,660
CGU 271,000 3,963
COLT Telecom Group* 110,000 2,325
Glaxo Wellcome 276,276 7,762
Hanson 600,000 5,441
Lloyds TSB Group 2,478 33
Prudential 347,000 4,582
Shell Transportation &
Trading 1,047,000 7,585
Smithkline Beecham 1,871 24
Vodafone Group 380,784 7,260
---------
73,592
---------
83
<PAGE>
AS OF MAY 31, 1999
STATEMENT OF NET ASSETS
- --------------------------------------------------------------------------------
BOSTON 1784 INTERNATIONAL EQUITY FUND (concluded)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Description Shares/Par (000) Value (000)
- --------------------------------------------------------------------------------
United States -- 1.5%
Global TeleSystems Group* 77,200 $ 5,867
---------
Total Foreign Common Stocks
(Cost $302,795) 354,779
---------
Foreign Preferred Stocks -- 1.9%
Brazil -- 0.9%
Telebras ADR 41,000 3,423
---------
Germany -- 1.0%
Porsche 1,720 3,921
---------
Total Foreign Preferred Stocks
(Cost $8,191) 7,344
---------
Repurchase Agreements -- 5.1%
J.P. Morgan,
4.81%, dated 05/28/99, matures
06/01/99, repurchase price
$2,167,446 (collateralized by
U.S. Treasury Instruments: total
market value $2,209,616) (A) $ 2,166 2,166
Paine Webber,
4.80%, dated 05/28/99, matures
06/01/99, repurchase price
$17,886,048 (collateralized by
U.S. Treasury Instruments: total
market value $18,234,398) (A) 17,876 17,876
---------
Total Repurchase Agreements
(Cost $20,042) 20,042
---------
Total Investments -- 98.0%
(Cost $331,028) 382,165
---------
Other Assets and Liabilities,
Net -- 2.0% 7,588
---------
- --------------------------------------------------------------------------------
Description Value (000)
- --------------------------------------------------------------------------------
Net Assets:
Capital Shares (unlimited
authorization -- no par value)
based on 30,162,839 outstanding
shares of beneficial interest $ 307,757
Distributions in excess of net
investment income (3,103)
Accumulated net realized gain
on investments 34,025
Net unrealized appreciation
on investments 51,137
Net unrealized depreciation on
forward foreign currency contracts,
foreign currency and translation
of other assets and liabilities
in foreign currency (63)
---------
Total Net Assets -- 100.0% $ 389,753
=========
Net Asset Value, Offering and
Redemption Price Per Share $12.92
=========
* Non-income producing security
(A) Tri-Party Repurchase Agreement
ADR--American Depository Receipt
GDR--Global Depository Receipt
The accompanying notes are an integral part of
the financial statements.
84
<PAGE>
BOSTON 1784 FUNDS
AS OF MAY 31, 1999
STATEMENTS OF ASSETS AND LIABILITIES (000)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Boston 1784 Short-Term Boston 1784 Tax-Exempt
Income Fund Medium-Term Income Fund
----------------------- -----------------------
ASSETS:
<S> <C> <C>
Investments at value (cost $164,492 and
$347,060, respectively) $163,978 $353,727
Income Receivable 1,847 5,739
Investment Securities Sold 10,099 17,089
Capital Shares Sold 853 579
Other Assets 339 477
-------- --------
Total Assets 177,116 377,611
-------- --------
LIABILITIES:
Income Payable 787 1,274
Investment Securities Purchased -- 18,586
Capital Shares Redeemed 62 20
Accrued Expenses Payable 122 272
Other Liabilities 113 464
-------- --------
Total Liabilities 1,084 20,616
-------- --------
Total Net Assets 176,032 356,995
======== ========
NET ASSETS:
Capital Shares (unlimited authorization --
no par value) based on 17,564,887 and 34,562,022
outstanding shares of beneficial interest, respectively 188,380 346,550
Undistributed (Distributions in excess of) net
investment income 15 (3)
Accumulated net realized gain (loss) on investments (11,847) 3,781
Net unrealized appreciation (depreciation) on
investments (516) 6,667
-------- --------
Total Net Assets $176,032 $356,995
======== ========
Net Asset Value, Offering, and Redemption Price Per Share $ 10.02 $ 10.33
======== ========
</TABLE>
The accompanying notes are an integral part of
the financial statements.
85
<PAGE>
STATEMENTS OF OPERATIONS (000)
- --------------------------------------------------------------------------------
FOR THE YEAR ENDED MAY 31, 1999
<TABLE>
<CAPTION>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
Boston Boston
Boston Boston 1784 Boston 1784
1784 1784 Prime 1784 Boston U.S. Government
Tax-Free U.S. Treasury Money Short-Term 1784 Medium-Term
Money Market Money Market Market Income Income Income
Fund Fund Fund Fund Fund Fund
===========================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
INCOME:
Interest Income $36,785 $19,798 $ 8,398 $11,025 $ 23,016 $16,429
Dividend Income -- -- -- -- -- --
Less: Foreign Taxes Withheld -- -- -- -- -- --
------- ------- ------- ------- -------- -------
Total Income 36,785 19,798 8,398 11,025 23,016 16,429
------- ------- ------- ------- -------- -------
EXPENSES:
Investment Advisory Fees 4,228 1,553 633 929 2,760 2,010
Less: Waiver of Investment
Advisory Fees -- (256) (124) -- (224) (181)
Administrator Fees 705 259 106 124 249 181
Shareholder Servicing Fees -- 388 158 -- -- --
12b-1 Fees -- -- -- 464 932 679
Less: Waiver of 12b-1 Fees -- -- -- (464) (932) (679)
Transfer Agent Fees & Expenses 127 386 188 62 64 54
Registration Fees 36 17 12 8 15 21
Trustee Fees 30 11 4 5 11 8
Printing 78 29 12 13 26 20
Amortization of Deferred
Organizational Costs -- -- -- -- -- --
Professional Fees 96 36 14 17 34 25
Custodian Fees 57 34 25 15 26 20
Other Expenses 70 67 -- 8 23 14
------- ------- ------- ------- -------- -------
Total Expenses,
Net of Waivers 5,427 2,524 1,028 1,181 2,984 2,172
------- ------- ------- ------- -------- -------
Net Investment Income (Loss) 31,358 17,274 7,370 9,844 20,032 14,257
------- ------- ------- ------- -------- -------
Net Realized Gain
on Investments 24 6 -- 605 4,091 434
Net Realized Loss from
Forward Foreign
Currency Contracts
and Foreign
Currency Transactions -- -- -- -- -- --
Net Change in Unrealized
Depreciation on Investments -- -- -- (1,760) (12,468) (4,968)
Net Change in Unrealized
Depreciation on Forward Foreign
Currency Contracts, Foreign
Currencies and Translation
of Other Assets and
Liabilities in
Foreign Currency -- -- -- -- -- --
------- ------- ------- ------- -------- -------
Net Realized and Unrealized
Gain (Loss) on
Investments and
Foreign Currency 24 6 -- (1,155) (8,377) (4,534)
------- ------- ------- ------- -------- -------
Net Increase (Decrease) in
Net Assets Resulting
From Operations $31,382 $17,280 $ 7,370 $ 8,689 $ 11,655 $ 9,723
======= ======= ======= ======= ======== =======
</TABLE>
86
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Boston Boston Boston Boston Boston
1784 1784 1784 1784 1784 Boston
Tax-Exempt Connecticut Florida Massachusetts Rhode Island 1784
Medium-Term Tax-Exempt Tax-Exempt Tax-Exempt Tax-Exempt Asset
Income Income Income Income Income Allocation
Fund Fund Fund Fund Fund Fund
==========================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
INCOME:
Interest Income $16,722 $ 8,765 $ 2,974 $11,987 $4,622 $1,588
Dividend Income -- -- -- -- -- 235
Less: Foreign Taxes Withheld -- -- -- -- -- --
------- ------- ------- ------- ------- ------
Total Income 16,722 8,765 2,974 11,987 4,622 1,823
------- ------- ------- ------- ------- ------
EXPENSES:
Investment Advisory Fees 2,424 1,255 435 1,733 654 382
Less: Waiver of Investment
Advisory Fees (183) (116) (55) (159) (71) --
Administrator Fees 218 113 39 156 59 34
Shareholder Servicing Fees -- -- -- -- -- --
12b-1 Fees 819 424 147 585 221 129
Less: Waiver of 12b-1 Fees (819) (424) (147) (585) (221) (129)
Transfer Agent Fees & Expenses 48 32 19 52 21 49
Registration Fees 22 15 5 19 8 2
Trustee Fees 9 5 2 7 2 1
Printing 25 13 4 18 7 4
Amortization of Deferred
Organizational Costs -- -- 10 -- -- --
Professional Fees 31 16 5 22 8 5
Custodian Fees 23 13 6 17 9 19
Other Expenses 4 11 -- 9 10 1
------- ------- ------- ------- ------- ------
Total Expenses,
Net of Waivers 2,621 1,357 470 1,874 707 497
------- ------- ------- ------- ------- ------
Net Investment Income (Loss) 14,101 7,408 2,504 10,113 3,915 1,326
------- ------- ------- ------- ------- ------
Net Realized Gain
on Investments 6,046 1,143 331 1,109 721 1,850
Net Realized Loss from
Forward Foreign
Currency Contracts
and Foreign
Currency Transactions -- -- -- -- -- --
Net Change in Unrealized
Depreciation on Investments (7,281) (2,686) (821) (2,392) (1,395) (262)
Net Change in Unrealized
Depreciation on Forward Foreign
Currency Contracts, Foreign
Currencies and Translation
of Other Assets and
Liabilities in
Foreign Currency -- -- -- -- -- --
------- ------- ------- ------- ------- ------
Net Realized and Unrealized
Gain (Loss) on
Investments and
Foreign Currency (1,235) (1,543) (490) (1,283) (674) 1,588
------- ------- ------- ------- ------- ------
Net Increase (Decrease) in
Net Assets Resulting
From Operations $12,866 $ 5,865 $ 2,014 $ 8,830 $3,241 $2,914
======= ======= ======= ======= ======= ======
<CAPTION>
Boston Boston
1784 Boston 1784
Growth and 1784 International
Income Growth Equity
Fund Fund Fund
==================================================================================
<S> <C> <C> <C>
INCOME:
Interest Income $ 1,804 $ 518 $ 5,207
Dividend Income 3,929 580 697
Less: Foreign Taxes Withheld (100) (44) (451)
------- ------- --------
Total Income 5,633 1,054 5,453
------- ------- --------
EXPENSES:
Investment Advisory Fees 4,117 1,455 4,358
Less: Waiver of Investment
Advisory Fees -- -- --
Administrator Fees 371 131 291
Shareholder Servicing Fees -- -- --
12b-1 Fees 1,391 492 1,090
Less: Waiver of 12b-1 Fees (1,391) (492) (1,090)
Transfer Agent Fees & Expenses 218 100 75
Registration Fees 21 9 19
Trustee Fees 16 6 13
Printing 41 13 31
Amortization of Deferred
Organizational Costs -- 9 --
Professional Fees 51 18 39
Custodian Fees 90 46 358
Other Expenses 36 39 29
------- ------- --------
Total Expenses,
Net of Waivers 4,961 1,826 5,213
------- ------- --------
Net Investment Income (Loss) 672 (772) 240
------- ------- --------
Net Realized Gain
on Investments 52,160 4,766 35,279
Net Realized Loss from
Forward Foreign
Currency Contracts
and Foreign
Currency Transactions (25) (2) (1,927)
Net Change in Unrealized
Depreciation on Investments (28,015) (15,346) (50,485)
Net Change in Unrealized
Depreciation on Forward Foreign
Currency Contracts, Foreign
Currencies and Translation
of Other Assets and
Liabilities in
Foreign Currency -- -- (2,062)
------- -------- --------
Net Realized and Unrealized
Gain (Loss) on
Investments and
Foreign Currency 24,120 (10,582) (19,195)
------- -------- --------
Net Increase (Decrease) in
Net Assets Resulting
From Operations $24,792 $(11,354) $(18,955)
======= ======== ========
</TABLE>
The accompanying notes are an integral part of
the financial statements.
87
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS (000)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Boston Boston Boston Boston
1784 1784 1784 1784
Tax-Free U.S. Treasury Prime Short-Term
Money Market Money Market Money Market Income
Fund Fund Fund Fund
====================================================================================================================================
6/1/98 6/1/97 6/1/98 6/1/97 6/1/98 6/1/97 6/1/98 6/1/97
to to to to to to to to
5/31/99 5/31/98 5/31/99 5/31/98 5/31/99 5/31/98 5/31/99 5/31/98
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
INVESTMENT ACTIVITIES:
Net Investment Income $ 31,358 $ 31,912 $ 17,274 $ 18,222 $ 7,370 $ 6,157 $ 9,844 $ 10,879
Net Realized Gain (Loss) on Investments 24 (11) 6 3 -- (1) 605 837
Net Change in Unrealized Appreciation/
(Depreciation) on Investments -- -- -- -- -- -- (1,760) 1,278
--------- ---------- -------- -------- -------- -------- -------- --------
Net Increase in Net Assets Resulting
from Operations 31,382 31,901 17,280 18,225 7,370 6,156 8,689 12,994
--------- ---------- -------- -------- -------- -------- -------- --------
DISTRIBUTIONS TO
SHAREHOLDERS:
Net Investment Income (31,358) (31,912) (17,274) (18,208) (7,370) (6,157) (9,843) (10,880)
Realized Capital Gains -- -- -- (14) -- -- -- --
--------- ---------- -------- -------- -------- -------- -------- --------
Total Distributions (31,358) (31,912) (17,274) (18,222) (7,370) (6,157) (9,843) (10,880)
--------- ---------- -------- -------- -------- -------- -------- --------
SHARE TRANSACTIONS:
Value from Shares Issued in Connection with
Acquisition of Common Trust Fund Assets -- -- -- -- -- -- -- --
Proceeds from Shares Issued 1,562,128 1,710,272 911,957 731,609 309,603 334,675 42,172 47,498
Reinvestment of Cash Distributions 4,871 5,475 16,728 17,633 6,288 3,939 6,066 6,500
Cost of Shares Redeemed (1,605,367)(1,553,624) (910,573) (766,882) (278,301) (334,124) (68,308) (52,889)
--------- ---------- -------- -------- -------- -------- -------- --------
Increase (Decrease) in Net Assets from
Share Transactions (38,368) 162,123 18,112 (17,640) 37,590 4,490 (20,070) 1,109
--------- ---------- -------- -------- -------- -------- -------- --------
Total Increase (Decrease) in Net Assets (38,344) 162,112 18,118 (17,637) 37,590 4,489 (21,224) 3,223
NET ASSETS:
Beginning of Period 1,007,724 845,612 372,657 390,294 127,588 123,099 197,256 194,033
--------- ---------- -------- -------- -------- -------- -------- --------
NET ASSETS:
End of Period $ 969,380 $1,007,724 $390,775 $372,657 $165,178 $127,588 $176,032 $197,256
========= ========== ======== ======== ======== ======== ======== ========
CAPITAL SHARE TRANSACTIONS:
Shares Issued in Connection with
Acquisition of
Common Trust Fund Assets -- -- -- -- -- -- -- --
Shares Issued 1,562,128 1,710,272 911,957 731,609 309,603 334,675 4,164 4,714
Shares Issued in Lieu of
Cash Distributions 4,871 5,475 16,728 17,631 6,288 3,939 599 645
Shares Redeemed (1,605,367)(1,553,624) (910,573) (766,882) (278,301) (334,124) (6,746) (5,251)
--------- ---------- -------- -------- -------- -------- -------- --------
Net Increase (Decrease) in
Capital Shares (38,368) 162,123 18,112 (17,642) 37,590 4,490 (1,983) 108
========= ========== ======== ======== ======== ======== ======== ========
</TABLE>
(1) Boston 1784 Florida Tax-Exempt Income Fund commenced operations on
June 30, 1997.
88
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Boston Boston Boston
1784 1784 1784
Boston U.S. Government Tax-Exempt Connecticut
1784 Medium-Term Medium-Term Tax-Exempt
Income Income Income Income
Fund Fund Fund Fund
================================================================================================================================
6/1/98 6/1/97 6/1/98 6/1/97 6/1/98 6/1/97 6/1/98 6/1/97
to to to to to to to to
5/31/99 5/31/98 5/31/99 5/31/98 5/31/99 5/31/98 5/31/99 5/31/98
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
INVESTMENT ACTIVITIES:
Net Investment Income $20,032 $21,734 $14,257 $13,560 $14,101 $12,959 $ 7,408 $ 5,476
Net Realized Gain (Loss) on Investments 4,091 3,216 434 643 6,046 4,330 1,143 905
Net Change in Unrealized Appreciation/
(Depreciation) on Investments (12,468) 5,632 (4,968) 4,799 (7,281) 7,040 (2,686) 3,929
-------- -------- -------- -------- -------- -------- -------- --------
Net Increase in Net Assets Resulting
from Operations 11,655 30,582 9,723 19,002 12,866 24,329 5,865 10,310
-------- -------- -------- -------- -------- -------- -------- --------
DISTRIBUTIONS TO
SHAREHOLDERS:
Net Investment Income (20,031) (21,861) (14,256) (13,561) (14,101) (12,959) (7,408) (5,476)
Realized Capital Gains (2,223) -- -- -- (5,447) (2,598) (1,010) (193)
-------- -------- -------- -------- -------- -------- -------- --------
Total Distributions (22,254) (21,861) (14,256) (13,561) (19,548) (15,557) (8,418) (5,669)
-------- -------- -------- -------- -------- -------- -------- --------
SHARE TRANSACTIONS:
Value from Shares Issued in Connection with
Acquisition of Common Trust Fund Assets -- -- -- -- -- -- -- --
Proceeds from Shares Issued 69,930 97,384 71,574 66,378 88,484 69,083 68,008 48,673
Reinvestment of Cash Distributions 5,831 4,251 1,267 1,330 5,924 2,973 2,159 1,144
Cost of Shares Redeemed (114,522) (52,578) (44,246) (29,571) (34,309) (27,776) (21,996) (15,455)
-------- -------- -------- -------- -------- -------- -------- --------
Increase (Decrease) in Net Assets from
Share Transactions (38,761) 49,057 28,595 38,137 60,099 44,280 48,171 34,362
-------- -------- -------- -------- -------- -------- -------- --------
Total Increase (Decrease) in Net Assets (49,360) 57,778 24,062 43,578 53,417 53,052 45,618 39,003
NET ASSETS:
Beginning of Period 392,556 334,778 252,719 209,141 303,578 250,526 142,107 103,104
-------- -------- -------- -------- -------- -------- -------- --------
NET ASSETS:
End of Period $343,196 $392,556 $276,781 $252,719 $356,995 $303,578 $187,725 $142,107
======== ======== ======== ======== ======== ======== ======== ========
CAPITAL SHARE TRANSACTIONS:
Shares Issued in Connection with
Acquisition of
Common Trust Fund Assets -- -- -- -- -- -- -- --
Shares Issued 6,813 9,526 7,383 6,957 8,401 6,620 6,267 4,557
Shares Issued in Lieu of
Cash Distributions 565 415 130 139 563 287 198 107
Shares Redeemed (11,138) (5,145) (4,567) (3,093) (3,252) (2,663) (2,025) (1,449)
-------- -------- -------- -------- -------- -------- -------- --------
Net Increase (Decrease) in
Capital Shares (3,760) 4,796 2,946 4,003 5,712 4,244 4,440 3,215
======== ======== ======== ======== ======== ======== ======== ========
<CAPTION>
Boston Boston
1784 1784
Florida Massachusetts
Tax-Exempt Tax-Exempt
Income Income
Fund Fund
=========================================================================================
6/1/98 6/30/97 6/1/98 6/1/97
to to to to
5/31/99 5/31/98(1) 5/31/99 5/31/98
- -----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITIES:
Net Investment Income $ 2,504 $ 2,029 $ 10,113 $ 8,072
Net Realized Gain (Loss) on Investments 331 510 1,109 159
Net Change in Unrealized Appreciation/
(Depreciation) on Investments (821) 924 (2,392) 6,487
------- ------- -------- --------
Net Increase in Net Assets Resulting
from Operations 2,014 3,463 8,830 14,718
------- ------- -------- --------
DISTRIBUTIONS TO
SHAREHOLDERS:
Net Investment Income (2,504) (2,029) (10,113) (8,072)
Realized Capital Gains (755) (86) -- --
------- ------- -------- --------
Total Distributions (3,259) (2,115) (10,113) (8,072)
------- ------- -------- --------
SHARE TRANSACTIONS:
Value from Shares Issued in Connection with
Acquisition of Common Trust Fund Assets -- 41,223 -- --
Proceeds from Shares Issued 22,210 12,935 98,037 82,919
Reinvestment of Cash Distributions 767 91 3,049 2,261
Cost of Shares Redeemed (4,729) (3,804) (38,069) (33,148)
------- ------- -------- --------
Increase (Decrease) in Net Assets from
Share Transactions 18,248 50,445 63,017 52,032
------- ------- -------- --------
Total Increase (Decrease) in Net Assets 17,003 51,793 61,734 58,678
NET ASSETS:
Beginning of Period 51,793 -- 206,137 147,459
------- ------- -------- --------
NET ASSETS:
End of Period $68,796 $51,793 $267,871 $206,137
======= ======= ======== ========
CAPITAL SHARE TRANSACTIONS:
Shares Issued in Connection with
Acquisition of
Common Trust Fund Assets -- 4,122 -- --
Shares Issued 2,151 1,269 9,328 8,043
Shares Issued in Lieu of
Cash Distributions 74 9 291 219
Shares Redeemed (458) (372) (3,627) (3,213)
------- ------- -------- --------
Net Increase (Decrease) in
Capital Shares 1,767 5,028 5,992 5,049
======= ======= ======== ========
</TABLE>
The accompanying notes are an integral part of
the financial statements.
89
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS (000)
- ---------------------------------------------------------------------------------------------------------------------
Boston
1784 Boston Boston
Rhode Island 1784 1784
Tax-Exempt Asset Growth and
Income Allocation Income
Fund Fund Fund
=======================================================================
6/1/98 6/1/97 6/1/98 6/1/97 6/1/98 6/1/97
to to to to to to
5/31/99 5/31/98 5/31/99 5/31/98 5/31/99 5/31/98
-----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT ACTIVITIES:
Net Investment Income (Loss) $ 3,915 $ 2,992 $ 1,326 $ 1,143 $ 672 $ 1,853
Net Realized Gain on Investments 721 133 1,850 2,239 52,160 3,027
Net Realized Loss from Forward
Foreign Currency Contracts and Foreign
Currency Transactions -- -- -- -- (25) --
Net Change in Unrealized Appreciation
(Depreciation) on Investments (1,395) 1,822 (262) 4,325 (28,015) 116,058
Net Change in Unrealized Appreciation
(Depreciation) on Foreign Forward
Currency Contracts, Foreign Currencies
and Translation of Other Assets and
Liabilities in Foreign Currency -- -- -- -- -- --
-------- ------- ------- ------- -------- --------
Net Increase (Decrease) in Net Assets
Resulting from Operations 3,241 4,947 2,914 7,707 24,792 120,938
-------- ------- ------- ------- -------- --------
DISTRIBUTIONS TO
SHAREHOLDERS:
Net Investment Income (3,915) (2,992) (1,328) (1,113) (884) (2,391)
Realized Capital Gains (663) (230) (2,229) (1,519) (12,700) (9,315)
-------- ------- ------- ------- -------- --------
Total Distributions (4,578) (3,222) (3,557) (2,632) (13,584) (11,706)
-------- ------- ------- ------- -------- --------
SHARE TRANSACTIONS:
Proceeds from Shares Issued 38,895 26,731 13,741 18,164 228,857 174,666
Reinvestment of Cash Distributions 1,283 686 3,400 2,550 12,381 9,909
Cost of Shares Redeemed (13,565) (6,097) (13,410) (11,028) (257,027) (197,762)
-------- ------- ------- ------- -------- --------
Increase (Decrease) in Net Assets from
Share Transactions 26,613 21,320 3,731 9,686 (15,789) (13,187)
-------- ------- ------- ------- -------- --------
Total Increase (Decrease) in Net Assets 25,276 23,045 3,088 14,761 (4,581) 96,045
NETASSETS:
Beginning of Period 76,797 53,752 50,283 35,522 553,997 457,952
-------- ------- ------- ------- -------- --------
NETASSETS:
End of Period $102,073 $76,797 $53,371 $50,283 $549,416 $553,997
======== ======= ======= ======= ======== ========
CAPITALSHARE TRANSACTIONS:
Shares Issued 3,644 2,532 913 1,246 10,493 8,883
Shares Issued in Lieu of Cash Distributions 120 65 231 178 574 516
Shares Redeemed (1,272) (578) (894) (759) (11,791) (10,004)
-------- ------- ------- ------- -------- --------
Net Increase (Decrease) in Capital Shares 2,492 2,019 250 665 (724) (605)
======== ======= ======= ======= ======== ========
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS (000)
- ---------------------------------------------------------------------------------------------
Boston
Boston 1784
1784 International
Growth Equity
Fund Fund
===============================================
6/1/98 6/1/97 6/1/98 6/1/97
to to to to
5/31/99 5/31/98 5/31/99 5/31/98
-----------------------------------------------
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITIES:
Net Investment Income (Loss) $ (772) $ (986) $ 240 $ 172
Net Realized Gain on Investments 4,766 10,066 35,279 2,006
Net Realized Loss from Forward
Foreign Currency Contracts and Foreign
Currency Transactions (2) -- (1,927) (1,046)
Net Change in Unrealized Appreciation
(Depreciation) on Investments (15,346) 23,681 (50,485) 21,711
Net Change in Unrealized Appreciation
(Depreciation) on Foreign Forward
Currency Contracts, Foreign Currencies
and Translation of Other Assets and
Liabilities in Foreign Currency -- -- (2,062) 1,965
-------- -------- -------- --------
Net Increase (Decrease) in Net Assets
Resulting from Operations (11,354) 32,761 (18,955) 24,808
-------- -------- -------- --------
DISTRIBUTIONS TO
SHAREHOLDERS:
Net Investment Income -- -- (997) (5,351)
Realized Capital Gains (6,328) (17,945) (2,548) (5,264)
-------- -------- -------- --------
Total Distributions (6,328) (17,945) (3,545) (10,615)
-------- -------- -------- --------
SHARE TRANSACTIONS:
Proceeds from Shares Issued 181,224 147,413 403,221 188,204
Reinvestment of Cash Distributions 4,590 14,178 1,744 4,260
Cost of Shares Redeemed (240,206) (180,344) (462,531) (239,886)
-------- -------- -------- --------
Increase (Decrease) in Net Assets from
Share Transactions (54,392) (18,753) (57,566) (47,422)
-------- -------- -------- --------
Total Increase (Decrease) in Net Assets (72,074) (3,937) (80,066) (33,229)
NETASSETS:
Beginning of Period 257,550 261,487 469,819 503,048
-------- -------- -------- --------
NETASSETS:
End of Period $185,476 $257,550 $389,753 $469,819
======== ======== ======== ========
CAPITALSHARE TRANSACTIONS:
Shares Issued 16,196 11,199 31,211 14,285
Shares Issued in Lieu of Cash Distributions 417 1,107 137 351
Shares Redeemed (21,152) (13,815) (35,496) (18,447)
-------- -------- -------- --------
Net Increase (Decrease) in Capital Shares (4,539) (1,509) (4,148) (3,811)
======== ======== ======== ========
</TABLE>
The accompanying notes are an integral part of the financial statements.
90
<PAGE>
<TABLE>
<CAPTION>
BOSTON 1784 FUNDS
FINANCIAL HIGHLIGHTS
- ------------------------------------------------------------------------------------------------------------------------------------
BOSTON 1784 Money Market Funds
For a Share Outstanding Throughout Each Period
- ------------------------------------------------------------------------------------------------------------------------------------
Dis- Ratio of
tribu- Net Ratio Ratio Net
Net tions Net Asset of of Net Ratio Investment
Asset from Asset Value Expenses Investment of Expenses Income
Value Net Net Value End to Income to Average to Average
Beginning Invest- Invest- End of Average to Net Assets Net Assets
of ment ment of Total Period Net Average (Excluding (Excluding
Period Income Income Period Return (000) Assets Net Assets Waivers) Waivers)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Boston 1784 Tax-Free Money Market Fund
For the year ended
May 31, 1999 $1.00 0.03 (0.03) $1.00 3.01% $ 969,380 0.51% 2.97% 0.51% 2.97%
For the year ended
May 31, 1998 $1.00 0.03 (0.03) $1.00 3.33% $1,007,724 0.53% 3.28% 0.53% 3.28%
For the year ended
May 31, 1997 $1.00 0.03 (0.03) $1.00 3.22% $ 845,612 0.54% 3.17% 0.56% 3.15%
For the year ended
May 31, 1996 $1.00 0.03 (0.03) $1.00 3.55% $ 549,628 0.54% 3.49% 0.60% 3.43%
For the year ended
May 31, 1995 $1.00 0.03 (0.03) $1.00 3.29% $ 539,412 0.50% 3.28% 0.61% 3.17%
- ------------------------------------------------------------------------------------------------------------------------------------
Boston 1784 U.S. Treasury Money Market Fund
For the year ended
May 31, 1999 $1.00 0.04 (0.04) $1.00 4.55% $ 390,775 0.65% 4.45% 0.72% 4.38%
For the year ended
May 31, 1998 $1.00 0.05 (0.05) $1.00 5.02% $ 372,657 0.65% 4.91% 0.70% 4.86%
For the year ended
May 31, 1997 $1.00 0.05 (0.05) $1.00 4.86% $ 390,294 0.64% 4.76% 0.72% 4.68%
For the year ended
May 31, 1996 $1.00 0.05 (0.05) $1.00 5.16% $ 78,999 0.64% 5.02% 0.75% 4.91%
For the year ended
May 31, 1995 $1.00 0.05 (0.05) $1.00 4.81% $ 55,068 0.60% 5.13% 0.92% 4.81%
- ------------------------------------------------------------------------------------------------------------------------------------
Boston 1784 Prime Money Market Fund
For the year ended
May 31, 1999 $1.00 0.05 (0.05) $1.00 4.78% $ 165,178 0.65% 4.66% 0.73% 4.58%
For the year ended
May 31, 1998 $1.00 0.05 (0.05) $1.00 5.16% $ 127,588 0.65% 5.05% 0.70% 5.00%
For the period ended
May 31, 1997 (1) $1.00 0.02 (0.02) $1.00 2.07%* $ 123,099 0.65% 4.98% 0.75% 4.88%
For the year ended
December 31, 1996 $1.00 0.05 (0.05) $1.00 5.02% $ 93,229 0.66% 4.85% 0.66% 4.85%
For the year ended
December 31, 1995 $1.00 0.05 (0.05) $1.00 5.49% $ 156,532 0.62% 5.40% 0.62% 5.40%
For the year ended
December 31, 1994 $1.00 0.04 (0.04) $1.00 3.75% $ 136,923 0.65% 3.64% 0.69% 3.60%
- ------------------------------------------------------------------------------------------------------------------------------------
* Return is for the period indicated and has not been annualized.
(1) Boston 1784 Prime Money Market Fund changed its fiscal year end from December 31 to May 31. Reflects operations for the period
from January 1, 1997 to May 31, 1997.
The accompanying notes are an integral part of the financial statements.
91
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
- ------------------------------------------------------------------------------------------------------------------------------------
BOSTON 1784 Bond Funds
For a Share Outstanding Throughout Each Period
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio Ratio
of of Ratio
Realized Dis- Net Expenses of
and tribu- Ratio Invest- to Net
Net Unrealized tions Dis- Net Net of ment Average Investment
Asset Gains from tribu- Asset Asset Expenses Income Net Income Port-
Value Net or Net tions Value End to to Assets to Average folio
Beginning Invest- (Losses) Invest- from End of Average Average (Ex- Net Assets Turn-
of ment on ment Capital of Total Period Net Net cluding (Excluding over
Period Income Investments Income Gains Period Return (000) Assets Assets Waivers) Waivers) Rate
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Boston 1784 Short-Term Income Fund
For the year ended
May 31, 1999 $10.09 0.54 (0.07) (0.54) -- $10.02 4.70% $176,032 0.64% 5.30% 0.89% 5.05% 36.57%
For the year ended
May 31, 1998 $ 9.98 0.57 0.11 (0.57) -- $10.09 6.98% $197,256 0.64% 5.67% 0.89% 5.42% 83.84%
For the year ended
May 31, 1997 $ 9.93 0.58 0.05 (0.58) -- $ 9.98 6.47% $194,033 0.65% 5.78% 0.93% 5.50% 128.11%
For the year ended
May 31, 1996 $10.09 0.60 (0.12) (0.60) (0.04) $ 9.93 4.87% $ 86,383 0.63% 5.87% 1.06% 5.44% 95.06%
For the period ended
May 31, 1995(1) $10.00 0.56 0.09 (0.56) -- $10.09 6.74%* $ 52,581 0.48% 6.31% 1.27% 5.52% 84.54%
- ------------------------------------------------------------------------------------------------------------------------------------
Boston 1784 Income Fund
For the year ended
May 31, 1999 $10.25 0.55 (0.26) (0.55) (0.06) $ 9.93 2.83% $343,196 0.80% 5.37% 1.11% 5.06% 64.34%
For the year ended
May 31, 1998 $ 9.99 0.61 0.26 (0.61) -- $10.25 8.88% $392,556 0.80% 5.91% 1.11% 5.60% 79.09%
For the year ended
May 31, 1997 $ 9.90 0.63 0.17 (0.63) (0.08) $ 9.99 8.32% $334,778 0.80% 6.31% 1.15% 5.96% 78.63%
For the year ended
May 31, 1996 $10.39 0.65 (0.37) (0.65) (0.12) $ 9.90 2.64% $235,022 0.80% 6.17% 1.20% 5.77% 100.51%
For the period ended
May 31, 1995(1) $10.00 0.62 0.39 (0.62) -- $10.39 10.69%* $196,515 0.55% 7.01% 1.23% 6.33% 80.53%
- ------------------------------------------------------------------------------------------------------------------------------------
Boston 1784 U.S. Government Medium-Term Income Fund
For the year ended
May 31, 1999 $ 9.60 0.51 (0.15) (0.51) -- $ 9.45 3.73% $276,781 0.80% 5.25% 1.12% 4.93% 47.85%
For the year ended
May 31, 1998 $ 9.37 0.55 0.23 (0.55) -- $ 9.60 8.56% $252,719 0.80% 5.80% 1.12% 5.48% 73.65%
For the year ended
May 31, 1997 $ 9.31 0.59 0.06 (0.59) -- $ 9.37 7.16% $209,141 0.79% 6.30% 1.16% 5.93% 98.22%
For the year ended
May 31, 1996 $ 9.57 0.61 (0.26) (0.61) -- $ 9.31 3.65% $167,494 0.80% 6.23% 1.24% 5.79% 158.66%
For the year ended
May 31, 1995 $ 9.36 0.58 0.21 (0.58) -- $ 9.57 8.79% $130,081 0.80% 6.24% 1.27% 5.77% 142.14%
- ------------------------------------------------------------------------------------------------------------------------------------
* Returns are for the period indicated and have not been annualized.
(1) Boston 1784 Short-Term Income Fund and Boston 1784 Income Fund commenced operations on July 1, 1994. All ratios for the period
have been annualized.
The accompanying notes are an integral part of the financial statements.
92
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
BOSTON 1784 FUNDS
- ------------------------------------------------------------------------------------------------------------------------------------
BOSTON 1784 Tax-Exempt Income Funds (continued)
For a Share Outstanding Throughout Each Period
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio Ratio
of of Ratio
Realized Dis- Net Expenses of
and tribu- Ratio Invest- to Net
Net Unrealized tions Dis- Net Net of ment Average Investment
Asset Gains from tribu- Asset Asset Expenses Income Net Income Port-
Value Net or Net tions Value End to to Assets to Average folio
Beginning Invest- (Losses) Invest- from End of Average Average (Ex- Net Assets Turn-
of ment on ment Capital of Total Period Net Net cluding (Excluding over
Period Income Investments Income Gains Period Return (000) Assets Assets Waivers) Waivers) Rate
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Boston 1784 Tax-Exempt Medium-Term Income Fund
For the year ended
May 31, 1999 $10.52 0.45 (0.01) (0.45) (0.18) $10.33 4.24% $356,995 0.80% 4.31% 1.11% 4.00% 68.58%
For the year ended
May 31, 1998 $10.18 0.48 0.44 (0.48) (0.10) $10.52 9.24% $303,578 0.80% 4.62% 1.12% 4.30% 34.06%
For the year ended
May 31, 1997 $ 9.99 0.50 0.19 (0.50) -- $10.18 7.74% $250,526 0.80% 4.92% 1.17% 4.55% 33.24%
For the year ended
May 31, 1996 $10.14 0.51 (0.09) (0.51) (0.06) $ 9.99 4.31% $196,787 0.79% 4.90% 1.21% 4.48% 37.35%
For the year ended
May 31, 1995 $ 9.90 0.48 0.24 (0.48) -- $10.14 7.58% $176,345 0.80% 5.02% 1.26% 4.56% 74.74%
- -----------------------------------------------------------------------------------------------------------------------------------
Boston 1784 Connecticut Tax-Exempt Income Fund
For the year ended
May 31, 1999 $10.81 0.48 (0.08) (0.48) (0.06) $10.67 3.72% $187,725 0.80% 4.37% 1.12% 4.05% 19.10%
For the year ended
May 31, 1998 $10.38 0.50 0.45 (0.50) (0.02) $10.81 9.29% $142,107 0.80% 4.66% 1.14% 4.32% 16.81%
For the year ended
May 31, 1997 $10.17 0.51 0.21 (0.51) -- $10.38 7.26% $103,104 0.76% 4.94% 1.17% 4.53% 4.28%
For the year ended
May 31, 1996 $10.27 0.53 (0.10) (0.53) -- $10.17 4.20% $ 81,441 0.75% 5.02% 1.29% 4.48% 20.41%
For the period ended
May 31, 1995(1) $10.00 0.45 0.27 (0.45) -- $10.27 7.45%* $ 61,369 0.52% 5.44% 1.40% 4.56% 35.56%
- -----------------------------------------------------------------------------------------------------------------------------------
Boston 1784 Florida Tax-Exempt Income Fund
For the year ended
May 31, 1999 $10.30 0.44 (0.04) (0.44) (0.14) $10.12 3.88% $ 68,796 0.80% 4.25% 1.14% 3.91% 10.88%
For the period ended
May 31, 1998(2) $10.00 0.43 0.32 (0.43) (0.02) $10.30 7.63%* $ 51,793 0.80% 4.59% 1.19% 4.20% 21.35%
- -----------------------------------------------------------------------------------------------------------------------------------
* Returns are for the period indicated and have not been annualized.
(1) Boston 1784 Connecticut Tax-Exempt Income Fund commenced operations on August 1, 1994. All ratios for the period have been
annualized.
(2) Boston 1784 Florida Tax-Exempt Income Fund commenced operations on June 30, 1997. All ratios for the period have been
annualized.
The accompanying notes are an integral part of the financial statements.
93
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
- ------------------------------------------------------------------------------------------------------------------------------------
BOSTON 1784 Tax-Exempt Income Funds
For a Share Outstanding Throughout Each Period
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio Ratio
of of Ratio
Realized Dis- Net Expenses of
and tribu- Ratio Invest- to Net
Net Unrealized tions Dis- Net Net of ment Average Investment
Asset Gains from tribu- Asset Asset Expenses Income Net Income Port-
Value Net or Net tions Value End to to Assets to Average folio
Beginning Invest- (Losses) Invest- from End of Average Average (Ex- Net Assets Turn-
of ment on ment Capital of Total Period Net Net cluding (Excluding over
Period Income Investments Income Gains Period Return (000) Assets Assets Waivers) Waivers) Rate
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Boston 1784 Massachusetts Tax-Exempt Income Fund
For the year ended
May 31, 1999 $10.42 0.45 (0.03) (0.45) -- $10.39 4.10% $267,871 0.80% 4.32% 1.12% 4.00% 9.32%
For the year ended
May 31, 1998 $10.01 0.47 0.41 (0.47) -- $10.42 8.91% $206,137 0.80% 4.54% 1.14% 4.20% 6.45%
For the year ended
May 31, 1997 $ 9.78 0.47 0.23 (0.47) -- $10.01 7.30% $147,459 0.79% 4.74% 1.18% 4.35% 9.47%
For the year ended
May 31, 1996 $ 9.90 0.48 (0.12) (0.48) -- $ 9.78 3.64% $106,619 0.80% 4.73% 1.28% 4.25% 47.00%
For the year ended
May 31, 1995 $ 9.81 0.47 0.09 (0.47) -- $ 9.90 6.00% $ 82,058 0.80% 4.93% 1.35% 4.38% 34.59%
- ------------------------------------------------------------------------------------------------------------------------------------
Boston 1784 Rhode Island Tax-Exempt Income Fund
For the year ended
May 31, 1999 $10.62 0.47 (0.04) (0.47) (0.08) $10.50 4.11% $102,073 0.80% 4.42% 1.13% 4.09% 12.44%
For the year ended
May 31, 1998 $10.31 0.49 0.35 (0.49) (0.04) $10.62 8.28% $ 76,797 0.80% 4.64% 1.16% 4.28% 13.79%
For the year ended
May 31, 1997 $10.06 0.50 0.25 (0.50) -- $10.31 7.61% $ 53,752 0.79% 4.88% 1.21% 4.46% 8.18%
For the year ended
May 31, 1996 $10.13 0.53 (0.07) (0.53) -- $10.06 4.65% $ 37,904 0.77% 5.16% 1.35% 4.58% 19.68%
For the period ended
May 31, 1995(1) $10.00 0.45 0.13 (0.45) -- $10.13 6.09%* $ 32,495 0.54% 5.56% 1.60% 4.50% 57.51%
- ------------------------------------------------------------------------------------------------------------------------------------
* Return is for the period indicated and has not been annualized.
(1) Boston 1784 Rhode Island Tax-Exempt Income Fund commenced operations on August 1, 1994. All ratios for the period have been
annualized.
The accompanying notes are an integral part of the financial statements.
94
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
BOSTON 1784 FUNDS
- ------------------------------------------------------------------------------------------------------------------------------------
BOSTON 1784 Stock Funds (continued)
For a Share Outstanding Throughout Each Period
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio Ratio
of of Ratio
Dis- Net Expenses of
tribu- Ratio Invest- to Net
Net Realized tions Dis- Net Net of ment Average Investment
Asset and from tribu- Asset Asset Expenses Income Net Income Port-
Value Net Unrealized Net tions Value End to to Assets to Average folio
Beginning Invest- Gains Invest- from End of Average Average (Ex- Net Assets Turn-
of ment on ment Capital of Total Period Net Net cluding (Excluding over
Period Income Investments Income Gains Period Return (000) Assets Assets Waivers) Waivers) Rate
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Boston 1784 Asset Allocation Fund
For the year ended
May 31, 1999 $15.16 0.38 0.48 (0.39) (0.66) $14.97 5.92% $ 53,371 0.96% 2.57% 1.21% 2.32% 49.78%
For the year ended
May 31, 1998 $13.40 0.37 2.30 (0.38) (0.53) $15.16 20.51% $ 50,283 0.98% 2.66% 1.23% 2.41% 47.83%
For the year ended
May 31, 1997 $12.31 0.34 1.44 (0.33) (0.36) $13.40 14.89% $ 35,522 1.07% 2.87% 1.37% 2.57% 23.60%
For the year ended
May 31, 1996 $10.99 0.31 1.61 (0.31) (0.29) $12.31 17.83% $ 16,831 1.25% 2.86% 1.90% 2.21% 39.56%
For the year ended
May 31, 1995 $ 9.84 0.28 1.15 (0.27) (0.01) $10.99 14.84% $ 8,622 1.25% 2.88% 2.51% 1.62% 67.23%
- ------------------------------------------------------------------------------------------------------------------------------------
Boston 1784 Growth and Income Fund
For the year ended
May 31, 1999 $21.72 0.02 0.97 (0.04) (0.50) $22.17 4.65% $549,416 0.89% 0.12% 1.14% (0.13) %50.15%
For the year ended
May 31, 1998 $17.54 0.07 4.55 (0.09) (0.35) $21.72 26.71% $553,997 0.90% 0.36% 1.15% 0.11% 39.03%
For the year ended
May 31, 1997 $15.23 0.12 2.63 (0.11) (0.33) $17.54 18.33% $457,952 0.92% 0.77% 1.19% 0.50% 15.35%
For the year ended
May 31, 1996 $12.16 0.10 3.08 (0.11) (0.00) $15.23 26.32% $303,463 0.94% 0.78% 1.24% 0.48% 39.50%
For the year ended
May 31, 1995 $10.57 0.11 1.67 (0.10) (0.09) $12.16 17.09% $229,200 0.94% 1.05% 1.23% 0.76% 38.94%
- ------------------------------------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements.
95
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
- ------------------------------------------------------------------------------------------------------------------------------------
BOSTON 1784 Stock Funds (continued)
For a Share Outstanding Throughout Each Period
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio Ratio
of of Ratio
Realized Dis- Net Expenses of
and tribu- Ratio Invest- to Net
Net Unrealized tions Dis- Net Net of ment Average Investment
Asset Net Gains from tribu- Asset Asset Expenses Income Net Income Port-
Value Invest- or Net tions Value End to to Assets to Average folio
Beginning ment (Losses) Invest- from End of Average Average (Ex- Net Assets Turn-
of Income on ment Capital of Total Period Net Net cluding (Excluding over
Period (Loss) Investments Income Gains Period Return (000) Assets Assets Waivers) Waivers) Rate
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Boston 1784 Growth Fund
For the year ended
May 31, 1999 $12.93 (0.08) (0.41) -- (0.38) $12.06 (3.54)% $185,476 0.93% (0.39)% 1.18% (0.64)% 61.02%
For the year ended
May 31, 1998 $12.20 (0.05) 1.59 -- (0.81) $12.93 12.64% $257,550 0.91% (0.35)% 1.16% (0.60)% 48.60%
For the year ended
May 31, 1997 $11.27 0.02 0.96 (0.05) (0.00) $12.20 8.77% $261,487 0.77% 0.17% 1.15% (0.21)% 57.46%
For the period ended
May 31, 1996(1) $10.00 0.02 1.25 (0.00) (0.00) $11.27 12.70%* $ 46,026 0.20% 1.75% 1.73% 0.22% 0.00%
- -----------------------------------------------------------------------------------------------------------------------------------
Boston 1784 International Equity Fund
For the year ended
May 31, 1999 $13.69 -- (0.66) (0.03) (0.08) $12.92 (4.85)% $389,753 1.20% 0.06% 1.45% (0.19)% 115.83%
For the year ended
May 31, 1998 $13.20 (0.02) 0.80 (0.15) (0.14) $13.69 6.19% $469,819 1.24% 0.04% 1.49% (0.21)% 103.47%
For the year ended
May 31, 1997 $12.05 0.07 1.23 (0.09) (0.06) $13.20 10.93% $503,048 1.27% 0.41% 1.52% 0.16% 22.88%
For the year ended
May 31, 1996 $10.41 0.11 1.85 (0.27) (0.05) $12.05 19.08% $362,460 1.13% 0.76% 1.61% 0.28% 15.55%
For the period ended
May 31, 1995(2) $10.00 0.06 0.35 (0.00) (0.00) $10.41 4.73%* $148,439 0.89% 2.06% 1.70% 1.25% 11.03%
- ------------------------------------------------------------------------------------------------------------------------------------
* Returns are for the period indicated and have not been annualized.
(1) Boston 1784 Growth Fund commenced operations on March 28, 1996. All ratios for the period have been annualized.
(2) Boston 1784 International Equity Fund commenced operations on January 3, 1995. All ratios for the period have been annualized.
The accompanying notes are an integral part of the financial statements.
96
</TABLE>
<PAGE>
BOSTON 1784 FUNDS
MAY 31, 1999
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
1. Organization
Boston 1784 Tax-Free Money Market, Boston 1784 U.S. Treasury Money Market,
Boston 1784 Prime Money Market (the "Money Market Funds"), Boston 1784
Short-Term Income, Boston 1784 Income, Boston 1784 U.S. Government Medium-Term
Income (the "Bond Funds"), Boston 1784 Tax-Exempt Medium-Term Income, Boston
1784 Connecticut Tax-Exempt Income, Boston 1784 Florida Tax-Exempt Income,
Boston 1784 Massachusetts Tax-Exempt Income, Boston 1784 Rhode Island Tax-Exempt
Income (the "Tax-Exempt Income Funds"), Boston 1784 Asset Allocation, Boston
1784 Growth and Income, Boston 1784 Growth and Boston 1784 International Equity
Funds (the "Stock Funds") are portfolios offered by Boston 1784 Funds (the
"Trust"), an open-end investment company registered under the Investment Company
Act of 1940, as amended. The Trust is offering shares in 17 separate portfolios
(the "Funds") as of May 31, 1999:
MONEY MARKET FUNDS:
Boston 1784 Tax-Free Money Market Fund
Boston 1784 U.S. Treasury Money Market Fund
Boston 1784 Institutional U.S. Treasury
Money Market Fund
Boston 1784 Prime Money Market Fund
Boston 1784 Institutional Prime Money Market Fund
BOND FUNDS:
Boston 1784 Short-Term Income Fund
Boston 1784 Income Fund
Boston 1784 U.S. Government Medium-Term
Income Fund
TAX-EXEMPT INCOME FUNDS:
Boston 1784 Tax-Exempt Medium-Term Income Fund
Boston 1784 Connecticut Tax-Exempt Income Fund
Boston 1784 Florida Tax-Exempt Income Fund
Boston 1784 Massachusetts Tax-Exempt Income Fund
Boston 1784 Rhode Island Tax-Exempt Income Fund
STOCK FUNDS:
Boston 1784 Asset Allocation Fund
Boston 1784 Growth and Income Fund
Boston 1784 Growth Fund
Boston 1784 International Equity Fund
The Funds' prospectuses provide a description of each Fund's investment
objectives, policies and strategies. The financial statements of Boston 1784
Institutional U.S. Treasury Money Market Fund and Boston 1784 Institutional
Prime Money Market Fund are not presented herein but are presented separately.
The assets of each Fund are segregated, and a shareholder's interest is limited
to the Fund in which shares are held. The financial statements have been
prepared in accordance with generally accepted accounting principles which
require the use of management's estimates. Actual results could differ from
these estimates.
2. Significant Accounting Policies
The following is a summary of significant accounting policies followed by the
Funds.
Security Valuation --
In valuing each of the Stock, Bond and Tax-Exempt Income Fund's assets, bonds
and other fixed income securities are valued on the basis of valuations
furnished by a pricing service, use of which has been approved by
97
<PAGE>
MAY 31, 1999
NOTES TO FINANCIAL STATEMENTS (Continued)
- --------------------------------------------------------------------------------
the Board of Trustees of the Trust. In making such valuations, the pricing
services may employ methodologies that utilize actual market transactions,
broker-dealer supplied valuations or other electronic data processing
techniques.
Equity securities listed on a domestic securities exchange for which
quotations are readily available, including securities traded over the counter,
are valued by a pricing service at the last quoted sale price on the principal
exchange on which they are traded on valuation date, or, if there is no such
reported sale on the valuation date, at the most recent quoted bid price.
Equity securities which are primarily traded on a foreign exchange are
generally valued by a pricing service at the preceding closing value on the
exchange.
Securities for which market quotations are not readily available are valued
at their fair value as determined in good faith by the Board of Trustees of the
Trust, or pursuant to procedures adopted by the Board subject to review by the
Board of the resulting valuations.
Investment securities of the Money Market Funds are stated at amortized
cost, which approximates market value. Under this valuation method, purchase
discounts and premiums are accreted and amortized ratably to maturity and are
included in interest income.
Foreign Currency Transactions --
The books and records of the Funds are maintained in U.S. dollars. Foreign
currency amounts are translated into U.S. dollars on the following basis:
I. Market value of investment securities, assets and liabilities at the
current rate of exchange; and
II. Purchases and sales of investment securities, income and expenses at
the relevant rates of exchange prevailing on the respective dates of
such transactions.
The Funds do not isolate that portion of gains and losses on investment
securities that are due to changes in the foreign exchange rates from that due
to changes in market prices of such securities.
The Funds report certain foreign currency related transactions as
components of unrealized and realized gains for financial reporting purposes,
whereas such components are treated as ordinary income for federal income tax
purposes.
Security Transactions and Investment Income --
Security transactions are accounted for on the trade date of the security
purchase or sale. Costs used in determining net realized capital gains and
losses on the sale of securities are those of the specific securities sold,
adjusted for the accretion and amortization of the purchase discounts and
premiums during the respective holding period, with the exception of Boston 1784
U.S. Government Medium-Term Income Fund which does not accrete or amortize
purchase discounts and premiums. Interest income is recorded on the accrual
basis. Dividend income is recorded on ex-date.
Repurchase Agreements --
The Funds invest in tri-party repurchase agreements. Securities pledged as
collateral for tri-party repurchase agreements are
98
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
maintained in a segregated account by the broker's custodian bank until maturity
of the repurchase agreements. Provisions of the agreements and procedures
adopted by the Adviser ensure that the market value of the collateral, including
accrued interest thereon, is sufficient in the event of default by the
counterparty. If the counterparty defaults and the value of the collateral
declines or if the counterparty enters into insolvency proceedings, realization
on the collateral by the Fund may be delayed or limited.
Expenses --
Expenses that are directly related to one of the Funds are charged directly to
that Fund. Other operating expenses of the Trust are prorated to the Funds on
the basis of relative net assets.
Distributions to Shareholders --
The Money Market, Bond and Tax-Exempt Income Funds declare distributions from
net investment income on a daily basis, payable on the first business day of the
following month. Boston 1784 Asset Allocation and Boston 1784 Growth and Income
Funds declare and pay dividends on a quarterly basis. Boston 1784 Growth Fund
declares and pays dividends on a semi-annual basis. Boston 1784 International
Equity Fund declare and pays dividends on an annual basis. Any net realized
capital gains on sales of securities for a Fund are distributed to its
shareholders at least annually.
Federal Income Taxes --
The Trust's policy is to comply with the requirements of the Internal Revenue
Code applicable to regulated investment companies and to distribute all of its
taxable income to its shareholders. Accordingly, no provision for federal income
taxes is required in the financial statements. The Funds may be subject to taxes
imposed by countries in which they invest with respect to their investments in
issuers existing or operating in such countries. Such taxes are generally based
on either income earned or repatriated. The Funds accrue such taxes when related
income is earned. The timing and characterization of certain income and capital
gains distributions are determined annually in accordance with federal tax
regulations that may differ from generally accepted accounting principles. These
differences relate primarily to foreign currency-denominated investments,
paydowns on asset-backed securities and certain securities sold at a loss. As a
result, net investment income (loss) and net realized gain (loss) on investment
transactions for a reporting period may differ from distributions during such
period. Accordingly, the following permanent differences have been reclassified
to/from the following accounts:
Accumulated Undistributed
Net Net
Paid-in- Realized Investment
Capital Gain/(Loss) Income
Boston 1784 Funds (000) (000) (000)
================================================================================
Prime Money Market Fund $ (17) $ (19) $ 35
Short-Term Income Fund -- (5) 5
Income Fund -- (95) 95
U.S. Government Medium-Term
Income Fund -- (255) 255
Tax-Exempt Medium-Term
Income Fund -- 3 (3)
Growth and Income Fund -- (237) 237
Growth Fund (765) (2) 767
International Equity Fund (605) (3) 608
99
<PAGE>
MAY 31, 1999
NOTES TO FINANCIAL STATEMENTS (Continued)
- --------------------------------------------------------------------------------
Organizational Costs --
Organizational costs have been deferred in the accounts of the Funds and are
being amortized on a straight line basis over a period of sixty months
commencing with operations. In the event any of the initial shares of the Funds
are redeemed by any holder thereof during the period that the Funds are
amortizing their organizational costs, the redemption proceeds payable to the
holders thereof by the Funds will be reduced by the unamortized organizational
costs in the same ratio as the number of shares redeemed bears to the initial
shares outstanding at the time of redemption.
Other --
Some countries in which the Funds invest require governmental approval for the
repatriation of investment income, capital or the proceeds of sales of
securities by foreign investors. In addition, for various reasons, including a
deterioration in a country's balance of payments, a country may impose temporary
restrictions on foreign capital remittances abroad.
The security exchanges of certain foreign markets are substantially smaller,
less liquid and more volatile than the major securities markets in the United
States. Consequently, acquisition and disposition of securities by the Funds may
be inhibited.
3. Investment Advisory and Custodial Services
Pursuant to an investment advisory agreement dated June 1, 1993, investment
advisory services are provided to the Trust by Bank-Boston, N.A. (the
"Adviser"). The Adviser is entitled to receive a fee of 0.40% of the average
daily net assets of Boston 1784 Tax-Free Money Market, Boston 1784 U.S. Treasury
Money Market and Boston 1784 Prime Money Market Funds, 0.50% of the average
daily net assets of Boston 1784 Short-Term Income Fund, 0.74% of the average
daily net assets of Boston 1784 Income, Boston 1784 U.S. Government Medium-Term
Income, Boston 1784 Tax-Exempt Medium-Term Income, Boston 1784 Connecticut
Tax-Exempt Income, Boston 1784 Florida Tax-Exempt Income, Boston 1784
Massachusetts Tax-Exempt Income, Boston 1784 Rhode Island Tax-Exempt Income,
Boston 1784 Asset Allocation, Boston 1784 Growth and Income and Boston 1784
Growth Funds. Such fees are computed daily and paid monthly. The Adviser has
voluntarily agreed to waive a portion of its fee as necessary to assist the
Funds in maintaining competitive expense ratios. Boston 1784 International
Equity Fund has entered into separate investment advisory agreements (each an
"Advisory Agreement") with BankBoston, N.A. ("BankBoston") and with Kleinwort
Benson Investment Management Americas Inc. ("Kleinwort" and together with
BankBoston the "International Advisers"). The Advisory Agreement with BankBoston
is dated as of November 28, 1994; the Advisory Agreement with Kleinwort is dated
as of October 27, 1995. The International Advisers are entitled to receive an
aggregate fee of 1.00% of the average daily net assets of Boston 1784
International Equity Fund. Such fee is computed daily and paid monthly.
The Trust and BankBoston, N.A. were parties to a custodial agreement dated
June 1, 1993 under which BankBoston, N.A. held cash, securities and other assets
100
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
of the Trust as required by the Investment Company Act of 1940, as amended. For
the period June 1, 1998 to September 30, 1998, BankBoston, N.A. served as the
Funds' custodian and received an annual fee, paid monthly, of 0.01% for the
first $100 million in average daily net assets, 0.0075% for the next $100
million in average daily net assets and 0.005% for the average daily net assets
over $200 million of each of the Funds. On September 30, 1998, the Custodial
Agreement was amended and assigned to Investors Bank & Trust Company ("IBT").
Effective October 1, 1998, IBT is entitled to receive an annual fee, to be paid
monthly, of 0.005% of the market value of each Fund's assets. In the capacity as
custodian to the Trust, BankBoston, N.A. played and IBT plays no role in
determining the investment policies of the Trust or which securities are to be
purchased or sold by the Funds.
4. Administrative and Distribution Services
Pursuant to an administration agreement dated December 1, 1996, SEI Investments
Mutual Funds Services, a wholly-owned subsidiary of SEI Investments Company,
acts as the Trust's Administrator, and is entitled to receive an annual fee of
0.085% of the Trust's first $5 billion of average daily net assets and 0.045% of
the Trust's average daily net assets over $5 billion. Such fee is computed daily
and paid monthly.
SEI Investments Distribution Co. ("SEI Investments"), a wholly-owned
subsidiary of SEI Investments Company, became the Trust's Distributor pursuant
to a distribution agreement dated June 1, 1993, as amended and restated October
27, 1995. The Trust has adopted a distribution plan with respect to each of the
Bond, Tax-Exempt Income and stock Funds pursuant to Rule 12b-1 under the
Investment Company Act of 1940, as amended (collectively, the "Plan"). The
Distribution Agreement and the Plan provide that the Trust will pay the
Distributor a fee, calculated daily and paid monthly, at an annual rate of 0.25%
of the average daily net assets of each of the Bond, Tax-Exempt Income and Stock
Funds. The Distributor agreed to voluntarily waive all of its 12b-1 distribution
fee for the year ended May 31, 1999.
Pursuant to a Shareholder Services Agreement dated December 1, 1996,
BankBoston, N.A. provides certain shareholder services to Boston 1784 U.S.
Treasury Money Market Fund and Boston 1784 Prime Money Market Fund and receives
compensation, computed daily and paid monthly, at an annual rate of 0.10% of the
average daily net assets of each such Fund. BankBoston, N.A. provides
shareholder services to the other Boston 1784 Funds presented in this report,
for which it does not receive compensation.
Certain officers of the Trust are also officers of the Administrator. Such
officers are paid no fees by the Trust.
The Trust has paid legal fees to a law firm of which the Secretary of the
Trust is a member.
5. Investment Transactions
The cost of security purchases and the proceeds from the sale of securities,
other than temporary cash investments, for the year ended May 31, 1999, are as
presented below for the Bond, Tax-Exempt Income and Stock Funds.
101
<PAGE>
MAY 31, 1999
NOTES TO FINANCIAL STATEMENTS (Continued)
- --------------------------------------------------------------------------------
FUND INVESTMENT TRANSACTIONS (000):
<TABLE>
<CAPTION>
PURCHASES SALES
==================================================================
U.S. GOVERNMENT U.S. GOVERNMENT
FOR THE YEAR ENDED MAY 31, 1999 SECURITIES OTHER SECURITIES OTHER
==================================================================
<S> <C> <C> <C> <C>
Boston 1784 Short-Term Income Fund $ 27,693 $ 25,064 $ 37,640 $ 41,493
Boston 1784 Income Fund 119,345 106,598 169,691 91,021
Boston 1784 U.S. Government
Medium-Term Income Fund 136,773 -- 111,570 4,184
Boston 1784 Tax-Exempt Medium-Term Income Fund -- 262,622 -- 216,883
Boston 1784 Connecticut Tax-Exempt Income Fund -- 76,854 -- 30,443
Boston 1784 Florida Tax-Exempt Income Fund -- 21,876 -- 6,033
Boston 1784 Massachusetts Tax-Exempt Income Fund -- 71,839 -- 20,305
Boston 1784 Rhode Island Tax-Exempt Income Fund -- 38,558 -- 10,381
Boston 1784 Asset Allocation Fund 5,979 8,165 7,546 4,967
Boston 1784 Growth and Income Fund -- 263,013 -- 286,074
Boston 1784 Growth Fund -- 115,186 -- 182,409
Boston 1784 International Equity Fund -- 478,832 -- 549,407
</TABLE>
At May 31, 1999, the following Funds have capital loss carryforwards (000):
<TABLE>
<CAPTION>
EXPIRATION 2002 2003 2004 2005 2006 2007
========================================================================
<S> <C> <C> <C> <C> <C> <C>
Boston 1784 Tax-Free Money Market Fund $ -- $ -- $ -- $ 104 $ 9 $ --
Boston 1784 Prime Money Market Fund 23 -- -- -- -- 1
Boston 1784 Short-Term Income Fund 10,933 323 282 309 -- --
Boston 1784 U.S. Government Medium-Term Income Fund -- 3,311 -- 1,867 -- --
Boston 1784 Massachusetts Tax-Exempt Income Fund -- -- -- 74 -- --
</TABLE>
At May 31, 1999, the total cost of securities and the net realized gains or
losses on securities sold for federal income tax purposes was not materially
different from amounts reported for financial purposes.
102
<PAGE>
BOSTON 1784 FUNDS
- --------------------------------------------------------------------------------
The aggregate gross unrealized gains or losses on securities at May 31,
1999 for the Bond, Tax-Exempt Income and Stock Funds are as follows (000):
<TABLE>
<CAPTION>
AGGREGATE AGGREGATE
GROSS GROSS NET
UNREALIZED UNREALIZED UNREALIZED
GAINS LOSSES GAINS/(LOSSES)
=================================================
<S> <C> <C> <C>
Boston 1784 Short-Term Income Fund $ 490 $(1,006) $ (516)
Boston 1784 Income Fund 2,451 (9,618) (7,167)
Boston 1784 U.S. Government Medium-Term Income Fund 2,791 (3,622) (831)
Boston 1784 Tax-Exempt Medium-Term Income Fund 7,628 (961) 6,667
Boston 1784 Connecticut Tax-Exempt Income Fund 5,040 (1,049) 3,991
Boston 1784 Florida Tax-Exempt Income Fund 1,461 (364) 1,097
Boston 1784 Massachusetts Tax-Exempt Income Fund 6,958 (911) 6,047
Boston 1784 Rhode Island Tax-Exempt Income Fund 2,432 (573) 1,859
Boston 1784 Asset Allocation Fund 8,953 (995) 7,958
Boston 1784 Growth and Income Fund 235,646 (5,210) 230,436
Boston 1784 Growth Fund 59,278 (3,737) 55,541
Boston 1784 International Equity Fund 57,968 (6,831) 51,137
</TABLE>
6. Concentration of Credit Risk
Boston 1784 Tax-Free Money Market, Boston 1784 Tax-Exempt Medium-Term Income,
Boston 1784 Connecticut Tax-Exempt Income, Boston 1784 Florida Tax-Exempt
Income, Boston 1784 Massachusetts Tax-Exempt Income and Boston 1784 Rhode Island
Tax-Exempt Income Funds invest in debt instruments of municipal issuers. The
issuers' ability to meet their obligations may be affected by economic
developments in a specific state or region. Boston 1784 Connecticut Tax-Exempt
Income, Boston 1784 Florida Tax-Exempt Income, Boston 1784 Massachusetts
Tax-Exempt Income and Boston 1784 Rhode Island Tax-Exempt Income Funds invest
primarily in obligations located in Connecticut, Florida, Massachusetts and
Rhode Island, respectively.
7. Line of Credit
The Trust has entered into a Line of Credit Agreement.Pursuant to this
agreement, the Trust has access to a $50 million uncommitted line
of credit and a $20 committed secured line of credit. The Trust is charged a
commitment fee of .10% of the unused portion of the committed line of credit.
Borrowings under the line are charged interest at the current overnight Federal
Funds rate plus 0.50%. Each Fund is individually, and not jointly, liable for
its particular advances under the line. During the year ended May 31, 1999, the
following funds were borrowed under the agreement:
103
<PAGE>
MAY 31, 1999
NOTES TO FINANCIAL STATEMENTS (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WEIGHTED WEIGHTED
MAXIMUM AVERAGE INTEREST AVERAGE
FUND BORROWING LOAN BALANCE DATE PAID RATE
=================================================================================================================
<S> <C> <C> <C> <C> <C>
Growth Fund $1,800,000 $ 866,000 12/11/98-12/15/98 $687 5.60%
Growth Fund 257,000 257,000 12/24/98-12/27/98 146 5.20%
International Equity Fund 3,500,000 3,500,000 3/16/99 516 5.31%
International Equity Fund 4,500,000 4,500,000 4/19/99 648 5.19%
</TABLE>
At May 31, 1999, there were no borrowings outstanding under the agreement.
8. Common Trust Fund Conversion
On June 30, 1997, BankBoston's Florida Tax-Exempt Bond Common Trust Fund was
converted into Boston 1784 Florida Tax-Exempt Income Fund. The assets, which
consisted of securities and related receivables, were converted on a tax-free
basis. The net assets (including unrealized appreciation) of the Common Trust
Fund immediately before the conversion, and the number of shares issued, were as
follows:
Boston 1784
Florida Tax-Exempt
Unrealized Income Fund Shares
Net Assets Appreciation Issued
================================================================================
$41,223,322 $994,489 4,122,332
9. Forward Foreign Currency Contracts
Boston 1784 International Equity Fund enters into forward foreign currency
exchange contracts as hedges against specific transactions or portfolio
positions. The aggregate principal amounts of the contracts are not recorded, as
the Fund does not intend to hold the contracts to maturity. All commitments are
"marked-to-market" daily at the applicable foreign exchange rate and any
resulting unrealized gains or losses are recorded currently. The Fund realizes
gains and losses at the time the forward contracts are extinguished. Such
contracts, which protect the value of the Fund's investment securities against a
decline in value of the hedged currency, do not eliminate fluctuations in the
underlying prices of the securities. They simply establish an exchange rate at a
future date. Although such contracts tend to minimize the risk of loss due to a
decline in the value of a hedged currency, they also tend to limit any potential
gain that might be realized should the value of such foreign currency increase.
104
<PAGE>
- --------------------------------------------------------------------------------
The following forward foreign currency contracts were outstanding at
May 31, 1999:
- --------------------------------------------------------------------------------
BOSTON 1784 INTERNATIONAL EQUITY FUND
FOREIGN CURRENCY PURCHASES:
<TABLE>
<CAPTION>
CONTRACT TO IN EXCHANGE UNREALIZED
MATURITY RECEIVE FOR DEPRECIATION
DATE (000) (000) (000)
========================================================================================================
<S> <C> <C> <C> <C>
6/02/99 EUR 884 $ 936 $(14)
6/30/99 EUR 2,406 2,552 (37)
6/02/99 GBP 88 141 --
6/04/99 GBP 1,006 1,613 --
-------
$(51)
=======
- --------------------------------------------------------------------------------------------------------
</TABLE>
FOREIGN CURRENCY SALES:
<TABLE>
<CAPTION>
CONTRACT TO IN EXCHANGE UNREALIZED
MATURITY RECEIVE FOR DEPRECIATION
DATE (000) (000) (000)
========================================================================================================
<S> <C> <C> <C> <C>
6/03/99 GBP 5,270 $8,372 $(79)
6/01/99 JPY 228,223 1,865 (12)
-------
$(91)
=======
- --------------------------------------------------------------------------------------------------------
</TABLE>
Currency Legend
EUR -- Euro
GBP -- Great British Pounds
JPY -- Japanese Yen
105
<PAGE>
MAY 31, 1999
NOTES TO FINANCIAL STATEMENTS (Continued)
- --------------------------------------------------------------------------------
10. Year 2000 Readiness Disclosure
Boston 1784 Funds have been working to prepare for the Year 2000 transition and
have taken steps to provide seamless processing for all systems and applications
utilized by the Funds' service providers. We have sought and received assurances
from each service provider that their computer systems have been remediated for
Year 2000. We are continuing to monitor the progress of these service providers
with respect to the testing of modified systems, and have sought and received
assurances that such testing confirms Year 2000 readiness.
While we have received such assurances, the Funds and their shareholders may
experience losses if these assurances prove to be incorrect. Losses could also
arise as a result of Year 2000 computer difficulties experienced by issuers of
portfolio securities or third parties, such as custodians, banks, and
broker-dealers, with which the Funds do business.
An additional Year 2000 consideration is the readiness of the companies in which
Boston 1784 Funds have invested. The Year 2000, like any other market influence,
could quite possibly impact Fund performance. The impact could as easily be
positive (a company that benefits due to its preparedness)as negative (a company
that suffers from lack of preparedness). Boston 1784 Funds' investment advisers
consider the Year 2000 transition, like any other factor, in making investment
decisions.
It is important to understand that Boston 1784 Funds cannot warrant or guarantee
the Year 2000 readiness of any third party.
106
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
To the Shareholders and
Board of Trustees of Boston 1784 Funds:
In our opinion, the accompanying statements of assets and liabilities, including
the schedules of investments, of Boston 1784 Short-Term Income Fund and Boston
1784 Tax-Exempt Medium-Term Income Fund, and the statements of net assets of
Boston 1784 Tax-Free Money Market Fund, Boston 1784 U.S. Treasury Money Market
Fund, Boston 1784 Prime Money Market Fund, Boston 1784 Income Fund, Boston 1784
U.S. Government Medium-Term Income Fund, Boston 1784 Connecticut Tax-Exempt
Income Fund, Boston 1784 Florida Tax-Exempt Income Fund, Boston 1784
Massachusetts Tax-Exempt Income Fund, Boston 1784 Rhode Island Tax-Exempt Income
Fund, Boston 1784 Asset Allocation Fund, Boston 1784 Growth and Income Fund,
Boston 1784 Growth Fund, and Boston 1784 International Equity Fund of Boston
1784 Funds (referred to collectively herein as the "Funds"), and the related
statements of operations and of changes in net assets and the financial
highlights present fairly, in all material respects, the financial position of
the Funds at May 31, 1999, the results of their operations, changes in their net
assets and the financial highlights for each of the periods presented
(commencing January 1, 1996 for Boston 1784 Prime Money Market Fund) in
conformity with generally accepted accounting principles. These financial
statements and financial highlights (hereafter referred to as "financial
statements") are the responsibility of the Funds' management; our responsibility
is to express an opinion on these financial statements based on our audits. We
conducted our audits of these financial statements in accordance with generally
accepted auditing standards which require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities owned at May 31, 1999 by
correspondence with the custodian and brokers, provide a reasonable basis for
the opinion expressed above. The financial highlights of Boston 1784 Prime Money
Market Fund for the fiscal periods presented prior to the year ended December
31, 1996, were audited by other independent accountants whose report dated
February 6, 1996 expressed an unqualified opinion thereon.
PRICEWATERHOUSECOOPERS LLP
2400 Eleven Penn Center
Philadelphia, Pennsylvania
July 9, 1999
107
<PAGE>
NOTICE TO SHAREHOLDERS OF
BOSTON 1784 FUNDS (UNAUDITED)
- --------------------------------------------------------------------------------
For taxpayers filing on a calendar year basis,
this notice is for informational purposes only.
<TABLE>
<CAPTION>
(A)* (B)*
Long-Term Ordinary (D)**
Capital Gains Income Total (C)** Tax- (E)**
Distributions Distributions Distributions Qualifying Exempt Foreign
Fund (Tax Basis) (Tax Basis) (Tax Basis) Dividends (1) Interest Tax Credit
===================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Tax-Free Money Market Fund 0.00% 100.00% 100.00% 0.00% 85.18% 0.00%
U.S. Treasury Money Market Fund 0.00% 100.00% 100.00% 0.00% 0.00% 0.00%
Prime Money Market Fund 0.00% 100.00% 100.00% 0.00% 0.00% 0.00%
Short-Term Income Fund 0.00% 100.00% 100.00% 0.00% 0.00% 0.00%
Income Fund 7.25% 92.75% 100.00% 0.00% 0.00% 0.00%
U.S. Government Medium-Term
Income Fund 0.00% 100.00% 100.00% 0.00% 0.00% 0.00%
Tax-Exempt Medium-Term Income Fund 27.82% 72.18% 100.00% 0.00% 94.69% 0.00%
Connecticut Tax-Exempt Income Fund 7.29% 92.71% 100.00% 0.00% 88.99% 0.00%
Florida Tax-Exempt Income Fund 23.54% 76.46% 100.00% 0.00% 94.47% 0.00%
Massachusetts Tax-Exempt Income Fund 0.00% 100.00% 100.00% 0.00% 93.57% 0.00%
Rhode Island Tax-Exempt Income Fund 14.54% 85.46% 100.00% 0.00% 95.14% 0.00%
Asset Allocation Fund 56.75% 43.25% 100.00% 18.82% 0.00% 0.00%
Growth and Income Fund 93.49% 6.51% 100.00% 100.00% 0.00% 0.00%
Growth Fund 100.00% 0.00% 100.00% 0.00% 0.00% 0.00%
International Equity Fund 71.97% 28.03% 100.00% 0.00% 0.00% 0.00%
</TABLE>
(1) Qualifying dividends represent dividends which qualify for the corporate
dividends received deduction.
* Items (A) and (B) are based on a percentage of the Fund's total
distributions.
** Items (C), (D) and (E) are based on a percentage of ordinary income
distributions of the Fund.
Please consult your tax adviser for proper treatment of this information.
108
<PAGE>
MONEY MARKET FUNDS
[ ] Boston 1784 Tax-Free Money Market Fund
[ ] Boston 1784 U.S. Treasury Money Market Fund
[ ] Boston 1784 Institutional U.S. Treasury Money Market Fund*
[ ] Boston 1784 Prime Money Market Fund
[ ] Boston 1784 Institutional Prime Money Market Fund*
BOND FUNDS
[ ] Boston 1784 Short-Term Income Fund
[ ] Boston 1784 Income Fund
[ ] Boston 1784 U.S. Government Medium-Term Income Fund
TAX-EXEMPT INCOME FUNDS
[ ] Boston 1784 Tax-Exempt Medium-Term Income Fund
[ ] Boston 1784 Connecticut Tax-Exempt Income Fund
[ ] Boston 1784 Florida Tax-Exempt Income Fund
[ ] Boston 1784 Massachusetts Tax-Exempt Income Fund
[ ] Boston 1784 Rhode Island Tax-Exempt Income Fund
STOCK FUNDS
[ ] Boston 1784 Asset Allocation Fund
[ ] Boston 1784 Growth and Income Fund
[ ] Boston 1784 Growth Fund
[ ] Boston 1784 International Equity Fund
*Covered by Boston 1784 Institutional Money Market Funds Annual Report
BOARD OF TRUSTEES
David H. Carter
Tarrant Cutler
Kenneth A. Froot
Sara L. Johnson
Kathryn Flacke Muncil
Robert A. Nesher
Alvin J. Silk
INVESTMENT ADVISER
BankBoston, N.A.
Boston, MA 02110
CO-ADVISER FOR
BOSTON 1784 INTERNATIONAL
EQUITY FUND
Kleinwort Benson Investment
Management Americas Inc.
New York, NY 10005
ADMINISTRATOR
SEI Investments Mutual Funds Services
Oaks, PA 19456
DISTRIBUTOR
SEI Investments Distribution Co.
Oaks, PA 19456
LEGAL COUNSEL
Bingham Dana LLP
Boston, MA 02110
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP
Philadelphia, PA 19103
CUSTODIAN
Investors Bank & Trust Company
Boston, MA 02116
[Boston 1784 Funds GRAPHIC OMITTED]
Boston 1784 Funds
P.O. Box 8524
Boston, MA 02266-8524
1-800-BKB-1784
This report and the financial statements contained herein are for the general
information of the shareholders of the funds named above. This report is not
authorized for distribution to prospective investors in a fund unless preceded
or accompanied by a currently effective prospectus.
MF-0148
