<PAGE> 1
The Valiant Fund
Annual Report
August 31, 2000
<PAGE> 2
The Valiant Fund
Annual Report - August 31, 2000
Table of Contents
Page
----
U.S. TREASURY MONEY MARKET PORTFOLIO
Schedule of Portfolio Investments 1
Statement of Assets and Liabilities 2
Statement of Operations 2
Statement of Changes in Net Assets 3
Financial Highlights 4
U.S. TREASURY INCOME PORTFOLIO
Statement of Assets and Liabilities 6
Statement of Operations 6
Statement of Changes in Net Assets 7
Financial Highlights 8
GENERAL MONEY MARKET PORTFOLIO
Schedule of Portfolio Investments 9
Statement of Assets and Liabilities 11
Statement of Operations 11
Statement of Changes in Net Assets 12
Financial Highlights 13
TAX-EXEMPT MONEY MARKET PORTFOLIO
Schedule of Portfolio Investments 15
Statement of Assets and Liabilities 20
Statement of Operations 20
Statement of Changes in Net Assets 21
Financial Highlights 22
Notes to Financial Statements 23
Report of Independent Accountants 29
<PAGE> 3
<TABLE>
THE VALIANT FUND SCHEDULE OF PORTFOLIO INVESTMENTS
U.S. TREASURY MONEY MARKET PORTFOLIO AUGUST 31, 2000
<CAPTION>
U.S. Treasury Obligations - 57.2%
PRINCIPAL
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ------ -----
<S> <C> <C>
U.S. TREASURY BILLS* - 57.2%
6.13%, 9/7/00 $ 5,000,000 $ 4,995,163
6.18%, 9/14/00 5,000,000 4,989,456
5.86%, 9/21/00 5,000,000 4,984,097
6.29%, 9/21/00 150,000,000 149,477,500
6.32%, 9/21/00 20,000,000 19,930,000
6.35%, 9/21/00 10,000,000 9,964,833
6.40%, 9/21/00 15,000,000 14,946,875
5.87%, 10/5/00 10,000,000 9,946,072
6.20%, 10/12/00 5,000,000 4,966,972
6.22%, 10/12/00 10,000,000 9,933,773
6.07%, 10/19/00 10,000,000 9,923,867
6.12%, 10/19/00 5,000,000 4,961,600
6.14%, 11/9/00 5,000,000 4,944,800
6.50%, 11/9/00 5,000,000 4,941,542
6.20%, 11/16/00 10,000,000 9,872,806
------------
TOTAL U.S. TREASURY OBLIGATIONS (COST $268,779,356) 268,779,356
------------
REPURCHASE AGREEMENTS - 44.0%
Goldman Sachs Co., 6.64% due 9/1/00, with a 41,300,000 41,300,000
maturity value of $41,307,618
(collateralized by $42,800,969 GNMA,
5.00%-8.00%, 7/15/08-4/20/30, total
market value $42,126,000)
JP Morgan Co., 6.62% due 9/1/00, with a 55,000,000 55,000,000
maturity value of $55,010,114
(collateralized by $58,842,142 GNMA,
6.00%-7.00%, 8/15/28-5/20/30, total
market value $56,100,000)
Morgan Stanley Co., 6.62% due 9/1/00, with a 55,000,000 55,000,000
maturity value of $55,010,114
(collateralized by $56,558,756 GNMA,
7.50%, 2/15/27, total market value
$56,576,403)
Salomon Smith Barney Inc., 6.64% due 9/1/00, 55,000,000 55,000,000
with a maturity value of $55,010,144 ------------
(collateralized by $57,219,419 GNMA,
5.70%-8.50%, 10/20/18-11/15/29, total
market value $56,100,000)
TOTAL REPURCHASE AGREEMENTS (COST $206,300,000) 206,300,000
------------
TOTAL INVESTMENTS (Cost $475,079,356) (a) - 101.2% 475,079,356
LIABILITIES IN EXCESS OF OTHER ASSETS - (1.2)% (5,839,947)
------------
NET ASSETS - 100.0% $469,239,409
============
</TABLE>
------------
(a) Cost for federal income tax and financial reporting purposes is the
same.
* Rate disclosed represents effective yield at August 31, 2000.
GNMA - General National Mortgage Association
See notes to financial statements.
1
<PAGE> 4
<TABLE>
THE VALIANT FUND
U.S. TREASURY MONEY MARKET PORTFOLIO
<CAPTION>
STATEMENT OF ASSETS AND LIABILITIES
AUGUST 31, 2000
<S> <C> <C>
ASSETS:
Investments, at value $268,779,356
Repurchase agreements 206,300,000
------------
Total investments 475,079,356
Cash 27,798
Interest receivable 37,990
------------
TOTAL ASSETS 475,145,144
LIABILITIES:
Dividends payable $5,098,159
Accrued expenses and other liabilities:
Investment manager 169,214
Distribution and shareholder servicing 630,334
Other 8,028
----------
TOTAL LIABILITIES 5,905,735
------------
NET ASSETS $469,239,409
============
COMPOSITION OF NET ASSETS:
Capital $469,505,291
Undistributed net investment income 51,967
Accumulated net realized losses from
investment transactions (317,849)
------------
NET ASSETS $469,239,409
============
Class A Shares
Net Assets $ 15,724,623
Shares Outstanding 15,748,067
Net Asset Value, Offering Price and
Redemption Price per share $ 1.00
============
Class B Shares
Net Assets $ 41,892,658
Shares Outstanding 41,904,375
Net Asset Value, Offering Price and
Redemption Price per share $ 1.00
============
Class D Shares
Net Assets $269,929,161
Shares Outstanding 270,142,352
Net Asset Value, Offering Price and
Redemption Price per share $ 1.00
============
Class E Shares
Net Assets $141,692,967
Shares Outstanding 141,710,496
Net Asset Value, Offering Price and
Redemption Price per share $ 1.00
============
<CAPTION>
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED AUGUST 31, 2000
<S> <C> <C>
INVESTMENT INCOME:
Interest $ 25,624,410
------------
TOTAL INVESTMENT INCOME 25,624,410
EXPENSES:
Investment manager $ 876,565
Distribution and shareholder servicing:
Class B Shares 146,979
Class D Shares 1,322,918
Class E Shares 772,254
Other 16,229
----------
Total expenses before contractual
fee reimbursements 3,134,945
Contractual fee reimbursements (13,795)
------------
NET EXPENSES 3,121,150
------------
NET INVESTMENT INCOME 22,503,260
------------
NET REALIZED LOSSES FROM INVESTMENT
TRANSACTIONS (4,109)
------------
CHANGE IN NET ASSETS RESULTING FROM
OPERATIONS $ 22,499,151
============
</TABLE>
See notes to financial statements.
2
<PAGE> 5
<TABLE>
THE VALIANT FUND
U.S. TREASURY MONEY MARKET PORTFOLIO
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE FOR THE
YEAR ENDED YEAR ENDED
AUGUST 31, AUGUST 31,
2000 1999
------------ -------------
<S> <C> <C>
INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income $ 22,503,260 $ 20,640,794
Net realized losses from investment transactions (4,109) (256,840)
------------ -------------
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS 22,499,151 20,383,954
------------ -------------
DIVIDENDS:
Net investment income:
Class A Shares (1,017,876) (1,204,030)
Class B Shares (3,046,760) (11,523,371)
Class D Shares (13,316,424) (7,798,165)
Class E Shares (5,122,200) (115,228)
------------ -------------
CHANGE IN NET ASSETS FROM SHAREHOLDER DIVIDENDS (22,503,260) (20,640,794)
------------ -------------
CHANGE IN NET ASSETS FROM CAPITAL TRANSACTIONS 172,131,305 (222,392,400)
------------ -------------
CHANGE IN NET ASSETS 172,127,196 (222,649,240)
NET ASSETS:
Beginning of period 297,112,213 519,761,453
------------ -------------
End of period $469,239,409 $ 297,112,213
============ =============
</TABLE>
See notes to financial statements.
3
<PAGE> 6
<TABLE>
THE VALIANT FUND
U.S. TREASURY MONEY MARKET PORTFOLIO
<CAPTION>
FINANCIAL HIGHLIGHTS, CLASS A SHARES
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED.
FOR THE YEARS ENDED AUGUST 31,
---------------------------------------------------------------
2000 1999 1998 1997 1996
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------- ------- ------- ------- -------
INVESTMENT ACTIVITIES
Net investment income 0.06 0.05 0.05 0.05 0.05
Net realized gains/(losses) from investment transactions (0.00)* (0.00)* (0.00)* 0.00* (0.00)*
------- ------- ------- ------- -------
Total from investment activities 0.06 0.05 0.05 0.05 0.05
------- ------- ------- ------- -------
DIVIDENDS
Net investment income (0.06) (0.05) (0.05) (0.05) (0.05)
------- ------- ------- ------- -------
Total dividends (0.06) (0.05) (0.05) (0.05) (0.05)
------- ------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======= ======= ======= ======= =======
TOTAL RETURN 5.66% 4.77% 5.43% 5.30% 5.45%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $15,725 $15,088 $31,185 $23,063 $85,260
Ratio of expenses to average net assets 0.20% 0.20% 0.20% 0.20% 0.20%
Ratio of net investment income to average net assets 5.55% 4.69% 5.27% 5.12% 5.21%
Ratio of expenses to average net assets (a) 0.20% 0.20% 0.20% 0.20% 0.20%
<CAPTION>
FINANCIAL HIGHLIGHTS, CLASS B SHARES
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED.
FOR THE YEARS ENDED AUGUST 31,
----------------------------------------------------------------
2000 1999 1998 1997 1996
------- ------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------- ------- -------- -------- --------
INVESTMENT ACTIVITIES
Net investment income 0.05 0.04 0.05 0.05 0.05
Net realized gains/(losses) from investment transactions (0.00)* (0.00)* (0.00)* 0.00* (0.00)*
------- ------- -------- -------- --------
Total from investment activities 0.05 0.04 0.05 0.05 0.05
------- ------- -------- -------- --------
DIVIDENDS
Net investment income (0.05) (0.04) (0.05) (0.05) (0.05)
------- ------- -------- -------- --------
Total dividends (0.05) (0.04) (0.05) (0.05) (0.05)
------- ------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======= ======= ======== ======== ========
TOTAL RETURN 5.39% 4.51% 5.17% 5.04% 5.18%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $41,893 $64,266 $326,675 $300,437 $126,327
Ratio of expenses to average net assets 0.45% 0.45% 0.45% 0.45% 0.45%
Ratio of net investment income to average net assets 5.20% 4.42% 5.05% 4.93% 5.01%
Ratio of expenses to average net assets (a) 0.45% 0.45% 0.45% 0.45% 0.45%
</TABLE>
* Less than $0.005 per share.
(a) During the period, certain fees were contractually reimbursed. If such
fee reimbursements had not occurred, the ratio would have been as
indicated. Amounts reimbursed were less than 0.005%.
See notes to financial statements.
4
<PAGE> 7
<TABLE>
THE VALIANT FUND
U.S. TREASURY MONEY MARKET PORTFOLIO
<CAPTION>
FINANCIAL HIGHLIGHTS, CLASS D SHARES
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED.
FOR THE PERIOD
FOR THE YEARS ENDED AUGUST 31, MAY 1, 1996
-------------------------------------------------- TO AUGUST 31,
2000 1999 1998 1997 1996 (a)
-------- -------- -------- -------- --------------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- -------
INVESTMENT ACTIVITIES
Net investment income 0.05 0.04 0.05 0.05 0.02
Net realized gains/(losses) from investment transactions (0.00)* (0.00)* (0.00)* 0.00* (0.00)*
-------- -------- -------- -------- -------
Total from investment activities 0.05 0.04 0.05 0.05 0.02
-------- -------- -------- -------- -------
DIVIDENDS
Net investment income (0.05) (0.04) (0.05) (0.05) (0.02)
-------- -------- -------- -------- -------
Total dividends (0.05) (0.04) (0.05) (0.05) (0.02)
-------- -------- -------- -------- -------
NET ASSET VALUE, END OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======== =======
TOTAL RETURN 5.13% 4.25% 4.91% 4.78% 1.55%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $269,929 $204,713 $161,901 $101,401 $35,549
Ratio of expenses to average net assets 0.70% 0.70% 0.70% 0.70% 0.70%(c)
Ratio of net investment income to average net assets 5.04% 4.16% 4.79% 4.69% 4.68%(c)
Ratio of expenses to average net assets (d) 0.70% 0.70% 0.70% 0.70% 0.70%(c)
<CAPTION>
FINANCIAL HIGHLIGHTS, CLASS E SHARES
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED.
FOR THE FOR THE PERIOD
YEAR ENDED APRIL 6, 1999
AUGUST 31, TO AUGUST 31,
2000 1999 (a)
---------- --------------
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.00 $ 1.00
-------- -------
INVESTMENT ACTIVITIES
Net investment income 0.05 0.02
Net realized losses from investment transactions (0.00)* (0.00)*
-------- -------
Total from investment activities 0.05 0.02
-------- -------
DIVIDENDS
Net investment income (0.05) (0.02)
-------- -------
Total dividends (0.05) (0.02)
-------- -------
NET ASSET VALUE, END OF PERIOD $ 1.00 $ 1.00
======== =======
TOTAL RETURN 4.82% 1.54%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $141,693 $13,086
Ratio of expenses to average net assets 1.00% 0.99%(c)
Ratio of net investment income to average net assets 5.31% 3.81%(c)
Ratio of expenses to average net assets 1.01%(e) 0.99%(c),(d)
</TABLE>
* Less than $0.005 per share.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) During the period, certain fees were contractually reimbursed. If such
fee reimbursements had not occurred, the ratio would have been as
indicated. Amounts reimbursed were less than 0.005%
(e) During the period, certain fees were contractually reimbursed. If such
fee reimbursements had not occurred, the ratio would have been as
indicated.
See notes to financial statements.
5
<PAGE> 8
<TABLE>
THE VALIANT FUND
U.S. TREASURY INCOME PORTFOLIO
<CAPTION>
STATEMENT OF ASSETS AND LIABILITIES
AUGUST 31, 2000
<S> <C> <C>
ASSETS:
Cash $ 979
-----
TOTAL ASSETS 979
LIABILITIES:
Accrued expenses:
Investment manager $ 362
-----
TOTAL LIABILITIES 362
-----
NET ASSETS $ 617
=====
COMPOSITION OF NET ASSETS:
Capital $ 618
Undistributed net investment income 84
Accumulated net realized losses from
investment transactions (85)
-----
NET ASSETS $ 617
=====
Shares Outstanding 618
=====
Net Asset Value, Offering Price
and Redemption Price per share $1.00
=====
<CAPTION>
STATEMENT OF OPERATIONS
FOR THE PERIOD DECEMBER 7, 1999 TO JANUARY 19, 2000*
<S> <C> <C>
INVESTMENT INCOME:
Interest $377,376
--------
TOTAL INVESTMENT INCOME 377,376
EXPENSES:
Investment manager $ 17,142
--------
TOTAL EXPENSES 17,142
--------
NET INVESTMENT INCOME 360,234
--------
CHANGE IN NET ASSETS RESULTING FROM
OPERATIONS $360,234
========
</TABLE>
* The Portfolio operated from December 7, 1999 to January 19, 2000.
See notes to financial statements
6
<PAGE> 9
<TABLE>
THE VALIANT FUND
U.S. TREASURY INCOME PORTFOLIO
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE PERIOD FOR THE PERIOD
DECEMBER 7, DECEMBER 14,
1999 TO JANUARY 1998 TO JANUARY
19, 2000 (a) 22, 1999 (b)
--------------- ---------------
<S> <C> <C>
INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income $ 360,234 $ 368,777
------------- -------------
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS 360,234 368,777
------------- -------------
DIVIDENDS:
Net investment income (360,234) (368,700)
------------- -------------
CHANGE IN NET ASSETS FROM SHAREHOLDER DIVIDENDS (360,234) (368,700)
------------- -------------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares issued 129,146,313 121,187,913
Dividends reinvested 3 77
Cost of shares redeemed (129,146,313) (121,212,914)
------------- -------------
CHANGE IN NET ASSETS FROM CAPITAL TRANSACTIONS 3 (24,924)
------------- -------------
CHANGE IN NET ASSETS 3 (24,847)
NET ASSETS:
Beginning of period 614 25,461
------------- -------------
End of period $ 617 $ 614
============= =============
SHARE TRANSACTIONS:
Issued 129,146,313 121,187,913
Reinvested 3 77
Redeemed (129,146,313) (121,212,914)
------------- -------------
CHANGE IN SHARES 3 (24,924)
============= =============
</TABLE>
(a) The Portfolio operated from December 7, 1999 to January 19, 2000.
(b) The Portfolio operated from December 14, 1998 to January 22, 1999.
See notes to financial statements
7
<PAGE> 10
<TABLE>
THE VALIANT FUND
U.S. TREASURY INCOME PORTFOLIO
<CAPTION>
FINANCIAL HIGHLIGHTS, CLASS A SHARES
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED.
FOR THE PERIODS ENDED
----------------------------------------------------------------------
2000 (a) 1999 (b) 1998 (c) 1997 (d) 1996 (e)
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------ ------ ------ ------ ------
INVESTMENT ACTIVITIES
Net investment income 0.01 0.00* 0.01 0.01 0.00*
Net realized losses from investment transactions -- -- -- (0.00)* (0.00)*
------ ------ ------ ------ ------
Total from Investment Activities 0.01 0.00* 0.01 0.01 0.00*
------ ------ ------ ------ ------
DIVIDENDS
Net investment income (0.01) (0.00)* (0.01) (0.01) (0.00)*
------ ------ ------ ------ ------
Total Dividends (0.01) (0.00)* (0.01) (0.01) (0.00)*
------ ------ ------ ------ ------
NET ASSET VALUE, END OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
====== ====== ====== ====== ======
TOTAL RETURN 0.51%(f) 0.40%(f) 0.74%(f) 0.54%(f) 0.35%(f)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $ 1 $ 1 $ 25 $ 25 $ 25
Ratio of expenses to average net assets (g) 0.20% 0.20% 0.20% 0.20% 0.20%
Ratio of net investment income to average net assets (g) 4.21% 3.69% 4.83% 4.24% 4.15%
Ratio of expenses to average net assets (g) 0.20% 0.22%(h) 0.23%(h) 0.23%(h) 0.35%(h)
</TABLE>
* Less than $0.005 per share.
(a) The Portfolio operated from December 7, 1999 to January 19, 2000.
(b) The Portfolio operated from December 14, 1998 to January 22, 1999.
(c) The Portfolio operated from December 17, 1997 to February 11, 1998.
(d) The Portfolio operated from December 13, 1996 to January 30, 1997.
(e) The Portfolio operated from December 11, 1995 to January 10, 1996.
(f) Not annualized.
(g) Annualized.
(h) During the period, certain fees were contractually reimbursed. If such
fee reimbursements had not occurred, the ratio would have been as
indicated.
See notes to financial statements
8
<PAGE> 11
<TABLE>
THE VALIANT FUND SCHEDULE OF PORTFOLIO INVESTMENTS
GENERAL MONEY MARKET PORTFOLIO AUGUST 31, 2000
<CAPTION>
COMMERCIAL PAPER - 67.7%
MATURITY PRINCIPAL
SECURITY DESCRIPTION RATE* DATE AMOUNT VALUE
-------------------- ----- ---- ------ -----
<S> <C> <C> <C> <C>
BANKING - 15.6%
Banco Bradesco SA 6.72% 9/18/00 $15,000,000 $ 14,953,180
Banco Bradesco SA 7.16 6/14/01 10,000,000 9,469,311
Banco Continental SA 6.78 12/27/00 10,000,000 9,786,475
Banco Itau SA 6.74 2/1/01 15,000,000 14,583,075
Banco Rio de La Plata SA 7.12 3/8/01 10,000,000 9,647,500
Banco Santander Brazil SA 6.62 11/9/00 10,000,000 9,875,033
Bank Argentina SA 6.90 12/18/00 10,000,000 9,799,900
------------
78,114,474
------------
CHEMICALS - 5.8%
Du Pont (E.I.) Denemours & Co. 6.42 10/16/00 3,900,000 3,869,775
Formosa Plastics Corp. 6.84 10/10/00 15,000,000 14,891,450
Formosa Plastics Corp. 6.78 10/12/00 10,000,000 9,924,378
------------
28,685,603
------------
ELECTRICAL & ELECTRONIC - 1.0%
Electric Reliability Council of Texas 6.79 10/16/00 5,000,000 5,000,000
------------
FINANCIAL SERVICES - 10.0%
General Electric Capital Corp. 6.88 10/5/00 5,000,000 4,968,314
General Electric Capital Corp. 6.51 10/31/00 10,000,000 9,895,500
Paine Webber Group Inc. 6.76 10/10/00 10,000,000 9,927,959
Paine Webber Group Inc. 6.76 10/26/00 5,000,000 4,949,201
UBS Finance Inc. 6.65 9/1/00 20,000,000 20,000,000
------------
49,740,974
------------
FOOD & BEVERAGE - 4.4%
Anheuser-Busch Co. 6.34 9/25/00 12,000,000 11,950,801
Anheuser-Busch Co. 6.41 10/4/00 5,000,000 4,971,583
Anheuser-Busch Co. 6.41 10/5/00 5,000,000 4,970,722
------------
21,893,106
------------
NATIONAL BANKS - 5.7%
Island Finance SpA 6.66 10/11/00 14,500,000 14,394,311
Unibanco-Uniao de Bancos Brasileims SA 7.13 7/13/01 15,000,000 14,125,875
------------
28,520,186
------------
UTILITIES - 5.0%
National Rural Utilities Cooperative 6.64 10/23/00 25,000,000 24,764,556
------------
SPECIAL PURPOSE ENTITY - 20.2%
Asset Portfolio Funding Corp. 6.76 9/18/00 10,000,000 9,968,597
CSN Oversea Corp. 6.78 9/26/00 10,000,000 9,953,681
Forrestal Funding Master Trust 6.76 9/11/00 14,000,000 13,974,178
Great Lakes Funding Capital Corp. 6.58 10/4/00 23,000,000 22,862,325
Market Street Funding Corp. 6.77 9/6/00 20,000,000 19,981,500
MPF Ltd. 6.61 10/26/00 24,000,000 23,760,199
------------
100,500,480
------------
Total COMMERCIAL PAPER (Cost $337,219,379) 337,219,379
------------
CORPORATE OBLIGATIONS - 9.1%
BANKING - 1.3%
CMW Real Estate LLC 6.65%**, 9/7/00 2,520,000 2,520,000
El Dorado Enterprises of Miami FL, 6.68%**, 9/7/00 3,800,000 3,800,000
------------
6,320,000
------------
</TABLE>
Continued
9
<PAGE> 12
<TABLE>
THE VALIANT FUND SCHEDULE OF PORTFOLIO INVESTMENTS
GENERAL MONEY MARKET PORTFOLIO AUGUST 31, 2000
<CAPTION>
CORPORATE OBLIGATIONS, CONTINUED
PRINCIPAL
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ------ -----
<S> <C> <C>
CONSTRUCTION - 3.0%
Lexington Parker, 6.63%**, 9/25/00 $15,000,000 $ 15,000,000
------------
FINANCIAL SERVICES - 3.9%
Goldman Sachs Group LP, 6.87%, 11/15/00 15,000,000 15,000,000
Wyoming Steele Investment Ltd., 6.70%**, 9/7/00 4,300,000 4,300,000
------------
19,300,000
------------
REAL ESTATE - 0.9%
Aztec Properties LLC, 6.68%**, 9/7/00 2,775,000 2,775,000
Ordeal Properties LLC 6.65%**, 9/6/00 1,900,000 1,900,000
------------
4,675,000
------------
TOTAL CORPORATE OBLIGATIONS (COST $45,295,000) 45,295,000
------------
MUNICIPAL BONDS AND NOTES - 4.6%
ALABAMA - 1.5%
Auburn Al Taxable Revenue Series B, 6.60%, 9/6/00** 7,710,000 7,710,000
------------
NEBRASKA - 2.3%
Nebraska Public Power, 6.65%, 12/7/00 11,000,000 11,000,000
------------
NEW YORK - 0.4%
New York Metropolitan Transportation, 6.60%, 9/6/00 2,050,000 2,050,000
Authority** ------------
OHIO - 0.4%
Hopkins Waterhouse LLC, 6.71%, 9/7/00** 2,000,000 2,000,000
------------
TOTAL MUNICIPAL BONDS AND NOTES (COST $22,760,000) 22,760,000
------------
TIME DEPOSIT - 8.0%
NATIONAL BANKS, COMMERCIAL - 8.0%
Bank National de Paris, 6.65%, 9/1/00 20,000,000 20,000,000
Toronto-Dominion, 6.66%, 9/1/00 20,000,000 20,000,000
------------
TOTAL TIME DEPOSIT (COST $40,000,000) 40,000,000
------------
REPURCHASE AGREEMENTS - 11.1%
Goldman Sachs Co., 6.64% due 9/1/00, with a 55,500,000 55,500,000
maturity value of $55,510,237 (collateralized by ------------
$57,441,764 GNMA, 6.00%-8.50%, 7/15/08-8/20/30, total
market value $56,610,000)
TOTAL REPURCHASE AGREEMENTS (COST $55,500,000) 55,500,000
------------
TOTAL INVESTMENTS (COST $500,774,379) (a) - 100.5% 500,774,379
LIABILITIES IN EXCESS OF OTHER ASSETS - (0.5)% (2,472,407)
------------
NET ASSETS - 100.0% $498,301,972
============
</TABLE>
------------
(a) Cost for federal income tax and financial reporting purposes is the
same.
* Rate disclosed represents effective yield at August 31, 2000.
** Variable rate investment. The rate presented represents rate in effect
at August 31, 2000. The maturity date presented reflects next rate
change date.
GNMA - Government National Mortgage Association
LLC - Limited Liability Company
LP - Limited Partnership
SA - Societa Anonyme (French Corp.)
SpA - Societa per Azioni (Italian Corp.)
See notes to financial statements.
10
<PAGE> 13
<TABLE>
THE VALIANT FUND
GENERAL MONEY MARKET PORTFOLIO
<CAPTION>
STATEMENT OF ASSETS AND LIABILITIES
AUGUST 31, 2000
<S> <C> <C>
ASSETS:
Investments, at value $445,274,379
Repurchase agreements 55,500,000
------------
Total investments 500,774,379
Cash 82,182
Interest receivable 479,532
------------
TOTAL ASSETS 501,336,093
LIABILITIES:
Dividends payable $2,883,825
Accrued expenses and other liabilities:
Investment manager 84,454
Distribution and shareholder servicing 64,447
Other 1,395
----------
TOTAL LIABILITIES 3,034,121
------------
NET ASSETS $498,301,972
============
COMPOSITION OF NET ASSETS:
Capital $498,581,573
Accumulated net realized losses from
investment transactions (279,601)
------------
NET ASSETS $498,301,972
============
Class A Shares
Net Assets $394,118,304
Shares Outstanding 394,389,594
Net Asset Value, Offering Price
and Redemption Price per share $ 1.00
============
Class B Shares
Net Assets $ 4,792,933
Shares Outstanding 4,793,790
Net Asset Value, Offering Price
and Redemption Price per share $ 1.00
============
Class D Shares
Net Assets $ 10,121,233
Shares Outstanding 10,121,646
Net Asset Value, Offering Price
and Redemption Price per share $ 1.00
============
Class E Shares
Net Assets $ 89,269,502
Shares Outstanding 89,276,543
Net Asset Value, Offering Price
and Redemption Price per share $ 1.00
============
<CAPTION>
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED AUGUST 31, 2000
<S> <C> <C>
INVESTMENT INCOME:
Interest $24,570,929
-----------
TOTAL INVESTMENT INCOME 24,570,929
EXPENSES:
Investment manager $805,537
Distribution and shareholder servicing fees:
Class B Shares 2,163
Class D Shares 35,514
Class E Shares 514,252
Other 10,427
--------
Total expenses before contractual
fee reimbursements 1,367,893
Contractual fee reimbursements (7,535)
-----------
NET EXPENSES 1,360,358
-----------
NET INVESTMENT INCOME 23,210,571
-----------
NET REALIZED LOSSES FROM INVESTMENT
TRANSACTIONS (12,899)
-----------
CHANGE IN NET ASSETS RESULTING FROM
OPERATIONS $23,197,672
===========
</TABLE>
See notes to financial statements.
11
<PAGE> 14
<TABLE>
THE VALIANT FUND
GENERAL MONEY MARKET PORTFOLIO
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE FOR THE
YEAR ENDED YEAR ENDED
AUGUST 31, AUGUST 31,
2000 1999
------------ ------------
<S> <C> <C>
INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income $ 23,210,571 $ 15,885,876
Net realized losses from investment transactions (12,899) (17,877)
------------ ------------
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS 23,197,672 15,867,999
------------ ------------
DIVIDENDS:
Net investment income:
Class A Shares (19,440,893) (14,903,734)
Class B Shares (48,386) (634,426)
Class D Shares (a) (392,806) --
Class E Shares (b) (3,328,486) (347,716)
------------ ------------
CHANGE IN NET ASSETS FROM SHAREHOLDER DIVIDENDS (23,210,571) (15,885,876)
------------ ------------
CHANGE IN NET ASSETS FROM CAPITAL TRANSACTIONS 211,778,075 (4,027,090)
------------ ------------
CHANGE IN NET ASSETS 211,765,176 (4,044,967)
NET ASSETS:
Beginning of period 286,536,796 290,581,763
------------ ------------
End of period $498,301,972 $286,536,796
============ ============
</TABLE>
(a) Commencement of operations was September 27, 1999.
(b) Commencement of operations was May 5, 1999.
See notes to financial statements.
12
<PAGE> 15
<TABLE>
THE VALIANT FUND
GENERAL MONEY MARKET PORTFOLIO
<CAPTION>
FINANCIAL HIGHLIGHTS, CLASS A
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED.
FOR THE YEARS ENDED AUGUST 31,
------------------------------------------------------------------
2000 1999 1998 1997 1996
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- --------
INVESTMENT ACTIVITIES
Net investment income 0.06 0.05 0.05 0.05 0.05
Net realized gains/(losses) from investment transactions (0.00)* (0.00)* 0.00* 0.00* (0.00)*
-------- -------- -------- -------- --------
Total from investment activities 0.06 0.05 0.05 0.05 0.05
-------- -------- -------- -------- --------
DIVIDENDS
Net investment income (0.06) (0.05) (0.05) (0.05) (0.05)
-------- -------- -------- -------- --------
Total dividends (0.06) (0.05) (0.05) (0.05) (0.05)
-------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======== ========
TOTAL RETURN 5.97% 5.00% 5.54% 5.40% 5.52%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $394,118 $254,808 $272,980 $568,715 $334,069
Ratio of expenses to average net assets 0.20% 0.20% 0.20% 0.20% 0.20%
Ratio of net investment income to average net assets 5.89% 4.91% 5.40% 5.33% 5.36%
Ratio of expenses to average net assets (a) 0.20% 0.20% 0.20% 0.20% 0.20%
<CAPTION>
FINANCIAL HIGHLIGHTS, CLASS B
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED.
FOR THE YEARS ENDED AUGUST 31,
----------------------------------------------------------------
2000 1999 1998 1997 1996
------ ------ ------- ------ ------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------ ------ ------- ------ ------
INVESTMENT ACTIVITIES
Net investment income 0.06 0.05 0.05 0.05 0.05
Net realized gains/(losses) from investment transactions (0.00)* (0.00)* 0.00* 0.00* (0.00)*
------ ------ ------- ------ ------
Total from investment activities 0.06 0.05 0.05 0.05 0.05
------ ------ ------- ------ ------
DIVIDENDS
Net investment income (0.06) (0.05) (0.05) (0.05) (0.05)
------ ------ ------- ------ ------
Total dividends (0.06) (0.05) (0.05) (0.05) (0.05)
------ ------ ------- ------ ------
NET ASSET VALUE, END OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
====== ====== ======= ====== ======
TOTAL RETURN 5.71% 4.74% 5.28% 5.14% 5.26%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $4,793 $1,569 $17,602 $9,155 $8,734
Ratio of expenses to average net assets 0.45% 0.45% 0.45% 0.45% 0.45%
Ratio of net investment income to average net assets 5.61% 4.72% 5.16% 5.02% 5.11%
Ratio of expenses to average net assets 0.46%(b) 0.45%(a) 0.45%(a) 0.45%(a) 0.45%(a)
</TABLE>
* Less than $0.005 per share.
(a) During the period, certain fees were contractually reimbursed. If such
fee reimbursements had not occurred, the ratio would have been as
indicated. Amounts reimbursed were less than 0.005%.
(b) During the period, certain fees were contractually reimbursed. If such
fee reimbursements had not occurred, the ratio would have been as
indicated.
See notes to financial statements.
13
<PAGE> 16
<TABLE>
THE VALIANT FUND
GENERAL MONEY MARKET PORTFOLIO
<CAPTION>
FINANCIAL HIGHLIGHTS, CLASS D
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICTED.
FOR THE PERIOD
SEPTEMBER 27, 1999
TO AUGUST 31,
2000 (a)
------------------
<S> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.00
-------
INVESTMENT ACTIVITIES
Net investment income 0.05
Net realized losses from investment transactions (0.00)*
-------
Total from investment activities 0.05
-------
DIVIDENDS
Net investment income (0.05)
-------
Total dividends (0.05)
-------
NET ASSET VALUE, END OF PERIOD $ 1.00
=======
TOTAL RETURN 5.10%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $10,121
Ratio of expenses to average net assets 0.70%(c)
Ratio of net investment income to average net assets 5.53%(c)
Ratio of expenses to average net assets (d) 0.70%(c)
<CAPTION>
FINANCIAL HIGHLIGHTS, CLASS E
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED.
FOR THE FOR THE PERIOD
YEAR ENDED MAY 5, 1999
AUGUST 31, TO AUGUST 31,
2000 1999 (a)
---------- --------------
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.00 $ 1.00
------- -------
INVESTMENT ACTIVITIES
Net investment income 0.05 0.01
Net realized losses from investment transactions (0.00)* (0.00)*
------- -------
Total from investment activities 0.05 0.01
------- -------
DIVIDENDS
Net investment income (0.05) (0.01)
------- -------
Total dividends (0.05) (0.01)
------- -------
NET ASSET VALUE, END OF PERIOD $ 1.00 $ 1.00
======= =======
TOTAL RETURN 5.13% 1.31%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $89,270 $30,159
Ratio of expenses to average net assets 1.00% 0.99%(c)
Ratio of net investment income to average net assets 5.18% 4.00%(c)
Ratio of expenses to average net assets 1.00%(d) 1.00%(c),(e)
</TABLE>
* Less than $0.005 per share.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) During the period, certain fees were contractually reimbursed. If such
fee reimbursements had not occurred, the ratio would have been as
indicated. Amounts reimbursed were less than 0.005%
(e) During the period, certain fees were contractually reimbursed. If such
fee reimbursements had not occurred, the ratio would have been as
indicated.
See notes to financial statements.
14
<PAGE> 17
<TABLE>
THE VALIANT FUND SCHEDULE OF PORTFOLIO INVESTMENTS
TAX-EXEMPT MONEY MARKET PORTFOLIO AUGUST 31, 2000
<CAPTION>
COMMERCIAL PAPER - 14.3%
Maturity Principal
Security Description Rate Date Amount Value
-------------------- ---- ---- ------ -----
<S> <C> <C> <C> <C>
ARIZONA - 1.4%
Salt River Project, Series B 4.10% 10/5/00 $3,000,000 $ 3,000,000
------------
NEBRASKA - 1.3%
Omaha Republic Power Distribution 4.20 11/17/00 2,600,000 2,600,000
------------
TENNESSEE - 1.0%
Shelby County, Series 2000A 4.20 11/20/00 2,000,000 2,000,000
TEXAS - 7.0%
Dallas Area Rapid Transit Authority, Series 99C 4.20 11/13/00 2,300,000 2,300,000
Harris County, GO 4.20 9/6/00 5,600,000 5,600,000
Harris County, GO, Series B, 4.20 11/20/00 1,705,000 1,705,000
Houston Water & Sewer Authority Revenue Series A 4.30 11/9/00 2,000,000 2,000,000
Texas Public Finance Authority 4.20 11/17/00 3,000,000 3,000,000
------------
14,605,000
------------
WISCONSIN - 3.6%
State of Wisconsin, Series B 4.05 10/3/00 2,477,000 2,477,000
State of Wisconsin, Series B 4.25 11/6/00 5,000,000 5,000,000
------------
7,477,000
------------
TOTAL COMMERCIAL PAPER (COST $29,682,000) 29,682,000
------------
MUNICIPAL BONDS AND NOTES - 85.5%
COLORADO - 2.6%
Colorado Health Facilities Authority Revenue,
Catholic Health, Series B, 4.30%*, 9/6/00 (LIQ-Bank One) 3,000,000 3,000,000
Jefferson County School District GO, Series B
(FGIC Insured), 5.00%, 12/15/00 1,000,000 1,002,497
University of Colorado Regents, Series A,
4.45%*, 1/1/01, Mandatory Put 7/1/01@100 (LOC-Bayerische LandesBank) 1,300,000 1,300,000
------------
5,302,497
------------
DISTRICT OF COLUMBIA - 1.4%
District of Columbia, GO, Series B-3, 4.35%*,
9/1/00 (LOC-Bank of America) 3,000,000 3,000,000
------------
FLORIDA - 2.4%
Dade County, Water & Sewer Systems Revenue
(FGIC Insured), 4.25%*, 9/6/00 (SPA-Commerzbank A.G.) 2,000,000 2,000,000
Orange County, Housing Finance Authority
Revenue, Series B, 4.15%*, 9/6/00 (LOC-FNMA) 3,000,000 3,000,000
------------
5,000,000
------------
GEORGIA - 7.1%
Burke County Development Authority, Pollution
Control Revenue, Georgia Power Company
(Vogtle 3rd Series), 4.25%*, 9/1/00 2,100,000 2,100,000
Burke County Development Authority, Pollution
Control Revenue, Georgia Power Company
(Vogtle Project), 4.30%*, 9/1/00 1,750,000 1,750,000
Burke County Development Authority, Pollution
Control Revenue, Oglethorpe Power Corp., 4.30%*, 9/6/00 2,460,000 2,460,000
</TABLE>
Continued
15
<PAGE> 18
<TABLE>
THE VALIANT FUND SCHEDULE OF PORTFOLIO INVESTMENTS
TAX-EXEMPT MONEY MARKET PORTFOLIO AUGUST 31, 2000
<CAPTION>
MUNICIPAL BONDS AND NOTES, CONTINUED
GEORGIA, CONTINUED
PRINCIPAL
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ------ -----
<S> <C> <C>
De Kalb Private Hospital Authority Revenue,
Egelston Children's Hospital, Series A, 4.30%*,
9/6/00 (LOC-Suntrust Bank) $4,800,000 $ 4,800,000
Monroe County, Development Authority
Pollution Control Revenue, Georgia Power
Supply, 4.30%*, 9/1/00 2,200,000 2,200,000
Putnam County, Development Authority
Pollution Control Revenue, Georgia Power
Supply, 4.30%*, 9/1/00 1,500,000 1,500,000
------------
14,810,000
------------
ILLINOIS - 2.3%
City of Chicago GO, 2.95%, 1/26/01
(LOC-Westduetsche Landesbank) 2,000,000 2,000,000
Illinois Health Facilities Authority Revenue,
Northwestern Memorial Hospital, 4.35%*, 9/1/00
(SPA-Northern Trust) 1,300,000 1,300,000
Illinois Health Facilities Authority Revenue,
Resurrection Health, Series A, 4.35%*, 9/1/00 1,400,000 1,400,000
------------
4,700,000
------------
INDIANA - 1.8%
St. Joseph County, Indiana Educational Facilities
Revenue, University Notre Dame Du Lac,
4.20%*, 9/7/00 (LIQ-Bank of America) 3,700,000 3,700,000
------------
KANSAS - 3.0%
Kansas State Development Finance Authority
Revenue, Village of Shalom Obligation, Group BB,
4.30%*, 9/1/00 (LOC-LaSalle National Bank) 1,000,000 1,000,000
Wyandott County, Kansas City Unified
Government GO, Series 18, 4.70%, 8/1/01 1,600,000 1,601,868
Wyandott County, Kansas City Unified
Government GO, Series 19, 4.70%, 8/1/01 866,000 867,011
Wyandott County, Kansas City Unified
Government GO, Series 20, 4.70%, 8/1/01 2,667,000 2,670,115
------------
6,138,994
------------
MARYLAND - 4.3%
Howard County, Multifamily Revenue, Avalon
Meadows Project, 4.10%*, 9/6/00 (LOC-FNMA) 5,700,000 5,700,000
Maryland State Health & Higher Educational
Facilities Authority Revenue, Catholic Health
Initiative, Series B, 4.30%*, 9/6/00 (LOC-Morgan Guaranty) 3,300,000 3,300,000
------------
9,000,000
------------
MICHIGAN - 3.9%
Detroit Sewer Disposal Revenue, Series A, 4.20%*, 9/6/00 4,700,000 4,700,000
Michigan State Strategic Fund Pollution Control
Revenue, Consumers Power Project, (AMBAC
Insured), 4.30%*, 9/1/00 2,200,000 2,200,000
</TABLE>
Continued
16
<PAGE> 19
<TABLE>
THE VALIANT FUND SCHEDULE OF PORTFOLIO INVESTMENTS
TAX-EXEMPT MONEY MARKET PORTFOLIO AUGUST 31, 2000
<CAPTION>
MUNICIPAL BONDS AND NOTES, CONTINUED
MICHIGAN, CONTINUED
PRINCIPAL
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ------ -----
<S> <C> <C>
Royal Oak Hospital Finance Authority Hospital
Revenue, William Beaumont Hospital, Series L,
4.30%**, 9/1/00 (SPA-Bank of America) $1,200,000 $ 1,200,000
------------
8,100,000
------------
MISSOURI - 2.3%
Columbia Water & Electric Revenue, Series B,
4.30%*, 9/6/00 (LOC-Toronto Dominion Bank) 3,800,000 3,800,000
Missouri State Health & Education Facilities
Authority Education Facilities Revenue, The
Washington University, Series A, 4.35%*, 9/1/00
(SPA-Morgan Guaranty) 1,000,000 1,000,000
------------
4,800,000
------------
NEBRASKA - 4.8%
Lancaster County, Nebraska Hospital Authority
Health Facilities Revenue, Immanuel Health
Systems, Series A, 4.35%*, 9/1/00 (LOC-LaSalle Bank) 7,000,000 7,000,000
Sarpy County, Hospital Authority Number One
Health Facilities Revenue, Immanuel Health
Systems, Series B, 4.35%*, 9/1/00 (LOC-LaSalle Bank) 2,890,000 2,890,000
------------
9,890,000
------------
NEVADA - 2.3%
Clark County, Airport Improvement Revenue,
Series A-1, 4.25%*, 9/6/00 4,867,000 4,867,000
------------
NEW MEXICO - 2.5%
Albuquerque Airport Revenue, 4.25%*, 9/6/00 5,100,000 5,100,000
------------
NEW YORK - 5.5%
Koch Floating Rate Trust (AMBAC Insured),
4.54%*, 9/7/00 (LIQ-State Street) 7,845,000 7,845,000
New York City GO, Series B (FGIC Insured),
4.40%*, 9/1/00 (SPA-FGIC) 3,600,000 3,600,000
------------
11,445,000
------------
NORTH CAROLINA - 3.2%
Charlotte Airport Revenue, Series A (MBIA
Insured), 4.25%*, 9/6/00 (SPA-Commerzbank A.G.) 4,295,000 4,295,000
Raleigh Durham Airport Authority Special
Facilities Revenue, American Airlines, Series
B, 4.35%*, 9/1/00 (LOC-Bank of America) 2,350,000 2,350,000
------------
6,645,000
------------
OHIO - 2.7%
The Ohio State Building Authority Revenue, State
Facilities Administration Building Fund, Series A, 5.50%, 10/1/00 1,000,000 1,001,234
The Ohio State University General Receipts,
Series B, 4.20%*, 9/6/00 3,000,000 3,000,000
The Ohio State University Revenue, General
Receipts, Series A-2, 5.15%, 12/1/00 1,500,000 1,503,711
------------
5,504,945
------------
</TABLE>
Continued
17
<PAGE> 20
<TABLE>
THE VALIANT FUND SCHEDULE OF PORTFOLIO INVESTMENTS
TAX-EXEMPT MONEY MARKET PORTFOLIO AUGUST 31, 2000
<CAPTION>
MUNICIPAL BONDS AND NOTES, CONTINUED
PRINCIPAL
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ------ -----
<S> <C> <C>
OREGON - 1.0%
Multnomah County, School District Number 1J
Portland Tax & Revenue Notes, 5.00%, 6/29/01 $2,000,000 $ 2,009,467
------------
PENNSYLVANIA - 3.6%
Allegheny County, Higher Education Building
Authority University Revenue, Carnegie Mellon
University, 4.30%*, 9/1/00 (SPA-Landesbank Hessen) 2,300,000 2,300,000
Berks County, GO (FGIC Insured), 7.25%,
Prefunded 11/15/00 @ 102 5,000,000 5,131,609
------------
7,431,609
------------
RHODE ISLAND - 3.2%
State of Rhode Island GO, Capital Development
Loan, Series B, 4.20%*, 9/6/00 (SPA-Landesbank Hesson) 6,700,000 6,700,000
------------
SOUTH CAROLINA - 2.3%
Piedmont Municipal Power Agency South
Carolina Electric Revenue, Series B, 4.25%*, 9/6/00 4,800,000 4,800,000
------------
TEXAS - 6.9%
Angelina & Neches River Authority, Textile
Industrial Development Corp., Solid Waste
Revenue, Series B, 4.35%*, 9/1/00 (LOC-Bank of America) 3,800,000 3,800,000
Angelina & Neches River Authority, Textile
Industrial Development Corp., Solid Waste
Revenue, Series C, 4.35%*, 9/1/00 (LOC-Bank of America) 2,600,000 2,600,000
Angelina & Neches River Authority, Textile
Industrial Development Corp., Solid Waste
Revenue, Series D, 4.35%*, 9/1/00 (LOC-Bank of America) 1,500,000 1,500,000
Dallas Area Rapid Transit Authority, North
Central Light Rail Notes Revenue, 4.20%*, 9/6/00
(LOC-Credit Local de France) 2,000,000 2,000,000
Grapevine Industrial Development Corp.
Revenue, American Airlines, Series A4, 4.35%*,
9/1/00, (LOC-Bayerische Landesbank) 1,000,000 1,000,000
Grapevine Industrial Development Corp.
Revenue, American Airlines, Series B1, 4.35%*,
9/1/00 (LOC-Bayerische Landesbank) 400,000 400,000
Grapevine Industrial Development Corp.
Revenue, American Airlines, Series B4, 4.35%*,
9/1/00 (LOC-Bayerische Landesbank) 400,000 400,000
Lone Star Texas Airport Improvement Authority
Revenue, A-1, 4.35%*, 9/1/00 (LOC-Royal Bank of Canada) 600,000 600,000
Lone Star Texas Airport Improvement Authority
Revenue, A-4, 4.35%*, 9/1/00 (LOC-Royal Bank of Canada) 1,300,000 1,300,000
Lone Star Texas Airport Improvement Authority
Revenue, B-3, 4.35%*, 9/1/00 (LOC-Royal Bank of Canada) 600,000 600,000
------------
14,200,000
------------
</TABLE>
Continued
18
<PAGE> 21
<TABLE>
THE VALIANT FUND SCHEDULE OF PORTFOLIO INVESTMENTS
TAX-EXEMPT MONEY MARKET PORTFOLIO AUGUST 31, 2000
<CAPTION>
MUNICIPAL BONDS AND NOTES, CONTINUED
PRINCIPAL
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ------ -----
<S> <C> <C>
UTAH - 1.0%
State of Utah GO, Series A, 4.20%*, 9/6/00
(SPA-Toronto Dominion Bank) $ 2,000,000 $ 2,000,000
------------
VIRGINIA - 0.5%
Roanoke Virginia Industrial Development
Authority Hospital Revenue, Roanoke Memorial
Hospitals, Series B, 4.30%*, 9/1/00 1,000,000 1,000,000
------------
WASHINGTON - 6.3%
Seattle Municipal Light & Power Revenue,
4.25%*, 9/6/00 (SPA-Morgan Guaranty) 4,000,000 4,000,000
Washington State GO, Series 96B, 4.25%*, 9/6/00
(SPA-Landesbank Hessen) 2,000,000 2,000,000
Washington State GO, Series B, 6.70%,
Prefunded 6/1/01 @ 100 1,000,000 1,013,665
Washington State Health Care Facilities
Authority Revenue, Sisters Providence, Series D,
4.35%*, 9/1/00 (SPA-Rabobank Nederland) 2,100,000 2,100,000
Washington State Public Power Supply Systems
Nuclear Project Number One Revenue, Series
1A-1, 4.25%*, 9/6/00 (LOC-Bank of America) 4,000,000 4,000,000
------------
13,113,665
------------
WISCONSIN - 7.4%
Elkhorn Area School District, Tax & Revenue
Anticipation Promissory Note, 4.80%, 8/24/01 2,500,000 2,505,820
Racine Unified School District Tax & Revenue
Anticipation Notes, 4.65%, 7/6/01 5,000,000 5,010,074
Sheboygan Pollution Control Revenue, Wisconsin
Electric Power Company, 4.25%*, 9/7/00 1,400,000 1,400,000
Sheboygan Pollution Control Revenue, Wisconsin
Power and Light Company, 4.20%*, 9/6/00 6,400,000 6,400,000
------------
15,315,894
------------
WYOMING - 1.2%
Uinta County Pollution Control Revenue,
Chevron USA Incorporated Project, 4.30%*, 9/1/00 2,500,000 2,500,000
------------
TOTAL MUNICIPAL BONDS AND NOTES (Cost $177,074,071) 177,074,071
------------
TOTAL INVESTMENTS (Cost $206,756,071) (a) - 99.8% 206,756,071
OTHER ASSETS IN EXCESS OF LIABILITIES - 0.2% 501,927
------------
NET ASSETS - 100.0% $207,257,998
============
</TABLE>
------------
(a) Cost for federal income tax and financial reporting purposes is the
same.
* Variable rate investment. The rate presented represents rate in effect
at August 31, 2000. The maturity date presented reflects next rate
change date.
AMBAC - AMBAC Indemnity Corp.
FNMA - Federal National Mortgage Association
FGIC - Financial Guaranty Insurance Company
GO - General Obligation
LIQ - Liquidity Facilities
LOC - Line of Credit
MBIA - Municipal Bond Insurance Association
SPA - Standby Purchase Agreement
See notes to financial statements.
19
<PAGE> 22
<TABLE>
THE VALIANT FUND
TAX-EXEMPT MONEY MARKET PORTFOLIO
<CAPTION>
STATEMENT OF ASSETS AND LIABILITIES
AUGUST 31, 2000
<S> <C> <C>
ASSETS:
Investments, at value $206,756,071
Cash 159,797
Interest receivable 1,033,380
------------
TOTAL ASSETS 207,949,248
LIABILITIES:
Dividends payable $660,575
Accrued expenses and other liabilities:
Investment manager 30,066
Distribution and shareholder servicing 30
Other 579
--------
TOTAL LIABILITIES 691,250
------------
NET ASSETS $207,257,998
============
COMPOSITION OF NET ASSETS:
Capital $207,421,423
Accumulated net realized losses from
investment transactions (163,425)
------------
NET ASSETS $207,257,998
============
Class A Shares
Net Assets $207,182,619
Shares Outstanding 207,346,044
Net Asset Value, Offering Price
and Redemption Price per share $ 1.00
============
Class D Shares
Net Assets $ 75,379
Shares Outstanding 75,379
Net Asset Value, Offering Price
and Redemption Price per share $ 1.00
============
<CAPTION>
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED AUGUST 31, 2000
<S> <C> <C>
INVESTMENT INCOME:
Interest $7,681,464
----------
TOTAL INVESTMENT INCOME 7,681,464
EXPENSES:
Investment manager $408,253
Distribution and shareholder servicing:
Class D Shares 63
Other 5,093
--------
Total expenses before contractual
fee reimbursements 413,409
Contractual fee reimbursements (5,093)
----------
NET EXPENSES 408,316
----------
NET INVESTMENT INCOME 7,273,148
----------
NET REALIZED LOSSES FROM INVESTMENT
TRANSACTIONS (42,330)
----------
CHANGE IN NET ASSETS RESULTING FROM
OPERATIONS $7,230,818
==========
</TABLE>
See notes to financial statements.
20
<PAGE> 23
<TABLE>
THE VALIANT FUND
TAX-EXEMPT MONEY MARKET PORTFOLIO
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE FOR THE
YEAR ENDED YEAR ENDED
AUGUST 31, AUGUST 31,
2000 1999
------------ ------------
<S> <C> <C>
INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income $ 7,273,148 $ 7,460,994
Net realized gains/(losses) from investment transactions (42,330) 972
------------ ------------
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS 7,230,818 7,461,966
------------ ------------
DIVIDENDS:
Net investment income:
Class A Shares (7,272,713) (7,460,994)
Class D Shares (a) (435) --
------------ ------------
CHANGE IN NET ASSETS FROM SHAREHOLDER DIVIDENDS (7,273,148) (7,460,994)
------------ ------------
CHANGE IN NET ASSETS FROM CAPITAL TRANSACTIONS (81,042,324) 19,684,346
------------ ------------
CHANGE IN NET ASSETS (81,084,654) 19,685,318
NET ASSETS:
Beginning of period 288,342,652 268,657,334
------------ ------------
End of period $207,257,998 $288,342,652
============ ============
</TABLE>
(a) Commencement of operations was June 19, 2000
See notes to financial statements.
21
<PAGE> 24
<TABLE>
THE VALIANT FUND
TAX-EXEMPT MONEY MARKET PORTFOLIO
<CAPTION>
FINANCIAL HIGHLIGHTS, CLASS A
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED.
FOR THE YEARS ENDED AUGUST 31,
--------------------------------------------------------------------
2000 1999 1998 1997 1996
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- --------
INVESTMENT ACTIVITIES
Net investment income 0.04 0.03 0.03 0.03 0.03
Net realized gains/(losses) from investment transactions (0.00)* 0.00* 0.00* (0.00)* (0.00)*
-------- -------- -------- -------- --------
Total from investment activities 0.04 0.03 0.03 0.03 0.03
-------- -------- -------- -------- --------
DIVIDENDS
Net investment income (0.04) (0.03) (0.03) (0.03) (0.03)
-------- -------- -------- -------- --------
Total dividends (0.04) (0.03) (0.03) (0.03) (0.03)
-------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======== ========
TOTAL RETURN 3.67% 3.01% 3.41% 3.42% 3.43%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $207,183 $288,343 $268,657 $282,368 $279,867
Ratio of expenses to average net assets 0.20% 0.20% 0.20% 0.20% 0.20%
Ratio of net investment income to average net assets 3.57% 2.96% 3.35% 3.38% 3.34%
Ratio of expenses to average net assets (d) 0.20% 0.20% 0.20% 0.20% 0.20%
<CAPTION>
FINANCIAL HIGHLIGHTS, CLASS D SHARES
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED.
FOR THE PERIOD
JUNE 19, 2000
TO AUGUST, 31
2000 (a)
--------------
<S> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.00
------
INVESTMENT ACTIVITIES
Net investment income 0.01
Net realized losses from investments (0.00)*
------
Total from investment activities 0.010
------
DIVIDENDS
Net investment income (0.01)
------
Total dividends (0.01)
------
NET ASSET VALUE, END OF PERIOD $ 1.00
======
TOTAL RETURN 0.70%(b)
DIVIDENDS
Net Assets at end of period (000) $ 75
Ratio of expenses to average net assets 0.70%(c)
Ratio of net investment income to average net assets 3.45%(c)
Ratio of expenses to average net assets (e) 0.71%(c)
</TABLE>
* Less than $0.005 per share.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) During the period, certain fees were contractually reimbursed. If such
fee reimbursements had not occurred, the ratio would have been as
indicated. Amounts reimbursed were less than 0.005%.
(e) During the period, certain fees were contractually reimbursed. If such
fee reimbursements had not occurred, the ratio would have been as
indicated.
See notes to financial statements.
22
<PAGE> 25
THE VALIANT FUND
NOTES TO FINANCIAL STATEMENTS
AUGUST 31, 2000
1. ORGANIZATION:
The U.S. Treasury Money Market Portfolio, U.S. Treasury Income
Portfolio, General Money Market Portfolio and Tax-Exempt Money Market
Portfolio (referred to individually as a "Portfolio" and collectively
as the "Portfolios") are separate portfolios of The Valiant Fund. The
Valiant Fund (the "Trust") is a Massachusetts business trust, organized
on January 29, 1993 and is registered under the Investment Company Act
of 1940, as amended (the "Act"), as an open end management investment
company. The Trust is authorized to offer five classes of shares: Class
A, Class B, Class C (has not commenced operations), Class D and Class
E.
2. SIGNIFICANT ACCOUNTING POLICIES:
The following is a summary of significant accounting policies
followed by the Portfolios in the preparation of their financial
statements. The policies are in conformity with generally accepted
accounting principles in the United States of America. The preparation
of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities
at the date of the financial statements and the reported amounts of
income and expenses for the period. Actual results could differ from
those estimates.
SECURITY VALUATION:
Investments of the Portfolios are valued at amortized cost.
Under the amortized cost method, discount or premium, if any, is
accreted or amortized, respectively, on a constant (straight-line)
basis to the maturity of the security.
SECURITIES TRANSACTIONS AND RELATED INCOME:
Securities transactions are recorded on trade date. Security
gains and losses are calculated on the identified cost basis. Interest
income is recognized on the accrual basis and includes, where
applicable, the amortization or accretion of a premium or a discount.
REPURCHASE AGREEMENTS:
Each Portfolio, except the U.S. Treasury Income Portfolio,
may enter into repurchase agreements with an entity whose
creditworthiness has been reviewed and found satisfactory by the
Portfolios Sub-Advisor, Reich & Tang Asset Management L.P. The
repurchase price generally equals the price paid by a Portfolio plus
interest negotiated on the basis of current short-term rates, which may
be more or less than the rate on the underlying portfolio securities.
The seller, under a repurchase agreement, is required to maintain the
collateral held pursuant to the agreement, with a market value equal to
or greater than the repurchase price (including accrued interest).
Collateral subject to repurchase agreements is held by the Portfolios'
custodian, either physically or in book entry form.
EXPENSE ALLOCATION:
Expenses directly attributable to a Portfolio are charged to
that Portfolio. Trust expenses are allocated proportionately among each
Portfolio within the Trust in relation to the net assets of each
Portfolio or another reasonable basis. Expenses specific to a class are
charged to that class.
(Continued)
23
<PAGE> 26
THE VALIANT FUND
NOTES TO FINANCIAL STATEMENTS
AUGUST 31, 2000
DIVIDENDS TO SHAREHOLDERS:
The Portfolios' declare all net investment income daily as
dividends to their shareholders and distribute such dividends monthly.
Additional dividends are also paid to the Portfolios'
shareholders to the extent necessary to avoid the federal excise tax on
certain undistributed income and net realized gains of registered
investment companies.
The amount of dividends from net investment income and net
realized gains are determined in accordance with federal income tax
regulations which may differ from the generally accepted accounting
principles of the United States of America. These "book/tax"
differences are either considered temporary or permanent in nature. To
the extent these differences are permanent in nature, such amounts are
reclassified to capital; temporary differences do not require
reclassification. As of August 31, 2000, no reclassifications were made
to capital.
FEDERAL TAXES:
Each Portfolio is a separate taxable entity for federal tax
purposes. Each Portfolio has qualified and intends to qualify each year
as a "regulated investment company" under Subchapter M of the Internal
Revenue Code, as amended and distribute substantially all of their
taxable net investment income and net realized gains, if any, to their
shareholders. Accordingly, no provision for federal income excise tax
is required.
3. RELATED PARTY TRANSACTIONS:
INVESTMENT ADVISOR:
Integrity Management & Research, Inc. (the "Manager"), a
wholly owned subsidiary of Integrity Investments, Inc., serves as the
Investment Adviser to the Trust. The Trust pays the Manager a fee,
computed daily and paid monthly, at the annual rate of 0.20% of the
average daily net assets of each Portfolio.
Under terms of the Management Agreement, all expenses incurred
by the Portfolios are paid directly by the Manager, except for
distribution and shareholder servicing fees, trustee fees, and other
miscellaneous non-recurring fees.
DISTRIBUTION AND SHAREHOLDER SERVICING PLAN:
Integrity Investments, Inc. (the "Distributor") acts as
exclusive distributor of the Trust's shares. The Trust has adopted
distribution and shareholder servicing plans for each class of shares
offered (together, the "Plans") pursuant to Rule 12b-1 of the 1940 Act.
For its services, the Distributor is authorized to receive a fee,
computed daily and paid monthly, based on the average daily net assets
of each class, at the following annual percentage rates:
<TABLE>
<CAPTION>
NAME FEE RATE
---- --------
<S> <C>
Class B Shares 0.25%
Class C Shares 0.40
Class D Shares 0.50
Class E Shares 0.80
</TABLE>
(Continued)
24
<PAGE> 27
THE VALIANT FUND
NOTES TO FINANCIAL STATEMENTS
AUGUST 31, 2000
FEE REIMBURSEMENTS:
For the year ended August 31, 2000, fees reimbursed by the
Manager are listed below:
<TABLE>
<CAPTION>
CONTRACTUAL
PORTFOLIO FEE REIMBURSEMENTS
--------- ------------------
<S> <C>
U.S. Treasury Money Market $13,795
General Money Market 7,535
Tax-Exempt Money Market 5,093
</TABLE>
4. CAPITAL SHARE TRANSACTONS:
Each class is authorized to issue an unlimited number of
shares with no par value. Transactions in capital and shares of
beneficial interest by class for the Portfolios for the year ended
August 31, 2000:
<TABLE>
<CAPTION>
U.S. TREASURY MONEY MARKET GENERAL MONEY MARKET TAX-EXEMPT MONEY MARKET
PORTFOLIO PORTFOLIO PORTFOLIO
------------------------------------- -------------------------------- --------------------------------
FOR THE FOR THE FOR THE FOR THE FOR THE FOR THE
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31,
2000 1999 2000 1999 2000 1999
-------------------- ---------------- -------------- --------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
CAPITAL TRANSACTIONS:
CLASS A SHARES:
Proceeds from
shares issued $ 96,695,109 $ 53,480,150 $ 3,412,978,913 $ 3,044,081,955 $ 581,846,881 $ 1,122,783,416
Dividends
reinvested 326 415 1,354,083 2,607,904 34 161
Cost of shares
redeemed (96,050,414) (69,564,003) (3,275,008,997) (3,064,845,668) (662,964,618) (1,103,099,231)
--------------- --------------- --------------- --------------- --------------- ---------------
Class A shares
capital
transactions 645,021 (16,083,438) 139,323,999 (18,155,809) (81,117,703) 19,684,346
--------------- --------------- --------------- --------------- --------------- ---------------
CLASS B SHARES:
Proceeds from
shares issued 120,971,303 1,018,981,987 5,786,019 37,761,032 -- --
Cost of shares
redeemed (143,440,646) (1,281,291,723) (2,568,020) (53,794,425) -- --
--------------- --------------- --------------- --------------- --------------- ---------------
Class B shares
capital
transactions (22,469,343) (262,309,736) 3,217,999 (16,033,393) -- --
--------------- --------------- --------------- --------------- --------------- ---------------
CLASS D SHARES
Proceeds from
shares issued 1,346,010,697 1,106,797,543 47,332,825 -- 150,400 --
Cost of shares
redeemed (1,280,679,381) (1,063,882,954) (37,211,179) -- (75,021) --
--------------- --------------- --------------- --------------- --------------- ---------------
Class D shares
capital
transactions 65,331,316 42,914,589 10,121,646 -- 75,379 --
--------------- --------------- --------------- --------------- --------------- ---------------
CLASS E SHARES
Proceeds from
shares issued 2,446,602,487 19,605,953 184,924,778 37,384,570 -- --
Dividends
reinvested 47 12 50 10 -- --
Cost of shares
redeemed (2,317,978,223) (6,519,780) (125,810,397) (7,222,468) -- --
--------------- --------------- --------------- --------------- --------------- --------------
Class E shares
capital
transactions 128,624,311 13,086,185 59,114,431 30,162,112 -- --
--------------- --------------- --------------- --------------- --------------- --------------
CHANGE FROM CAPITAL
TRANSACTIONS $ 172,131,305 $ (222,392,400) $ 211,778,075 $ (4,027,090) $ (81,042,324) $ 19,684,346
=============== =============== =============== =============== =============== ==============
</TABLE>
(Continued)
25
<PAGE> 28
THE VALIANT FUND
NOTES TO FINANCIAL STATEMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
U.S. TREASURY MONEY MARKET GENERAL MONEY MARKET TAX-EXEMPT MONEY MARKET
PORTFOLIO PORTFOLIO PORTFOLIO
---------------------------------- ------------------------------ ------------------------------
FOR THE FOR THE FOR THE FOR THE FOR THE FOR THE
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31,
2000 1999 2000 1999 2000 1999
---------------- --------------- ------------- -------------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
SHARE TRANSACTIONS:
CLASS A SHARES:
Issued 96,695,109 53,480,150 3,412,978,913 3,044,081,955 581,846,881 1,122,783,416
Reinvested 326 415 1,354,083 2,607,904 34 161
Redeemed (96,050,414) (69,564,003) (3,275,008,997) (3,064,845,668) (662,964,618) (1,103,099,231)
-------------- -------------- -------------- -------------- -------------- --------------
Change in Class A
Shares 645,021 (16,083,438) 139,323,999 (18,155,809) (81,117,703) 19,684,346
-------------- -------------- -------------- -------------- -------------- --------------
CLASS B SHARES:
Issued 120,971,303 1,018,981,987 5,786,019 37,761,032 -- --
Redeemed (143,440,646) (1,281,291,723) (2,568,020) (53,794,425) -- --
-------------- -------------- -------------- -------------- -------------- --------------
Change in Class B
Shares (22,469,343) (262,309,736) 3,217,999 (16,033,393) -- --
-------------- -------------- -------------- -------------- -------------- --------------
CLASS D SHARES
Issued 1,346,010,697 1,106,797,543 47,332,825 -- 150,400 --
Redeemed (1,280,679,381) (1,063,882,954) (37,211,179) -- (75,021) --
-------------- -------------- -------------- -------------- -------------- --------------
Change in Class D
Shares 65,331,316 42,914,589 10,121,646 -- 75,379 --
-------------- -------------- -------------- -------------- -------------- --------------
CLASS E SHARES
Issued 2,446,602,487 19,605,953 184,924,778 37,384,570 -- --
Reinvested 47 12 50 10 -- --
Redeemed (2,317,978,223) (6,519,780) (125,810,397) (7,222,468) -- --
-------------- -------------- -------------- -------------- -------------- --------------
Change in Class E
Shares 128,624,311 13,086,185 59,114,431 30,162,112 -- --
-------------- -------------- -------------- -------------- -------------- --------------
CHANGE FROM SHARE
TRANSACTIONS 172,131,305 (222,392,400) 211,778,075 (4,027,090) (81,042,324) 19,684,346
============== ============== ============== ============== ============== ==============
</TABLE>
5. REALIZED LOSS CARRYFORWARD:
For federal income tax purposes, the following Portfolios have
realized loss carryforwards as of August 31, 2000, which are available
to offset future realized gains, if any:
<TABLE>
<CAPTION>
NAME AMOUNT EXPIRES
--------------------------------------------- ------------------------------------------------------------
<S> <C> <C>
U.S. Treasury Money Market $ 296,015 2008
================================
U.S. Treasury Income $ 7 2005
78 2007
--------------------------------
$ 85
================================
General Money Market $ 13,154 2003
30,898 2004
173,216 2005
51,799 2008
--------------------------------
$ 269,067
================================
Tax-Exempt Money Market $ 49,749 2003
54,799 2004
1,943 2005
12,059 2006
2,545 2008
--------------------------------
$ 121,095
================================
</TABLE>
(Continued)
26
<PAGE> 29
THE VALIANT FUND
NOTES TO FINANCIAL STATEMENTS
AUGUST 31, 2000
6. FEDERAL INCOME TAX INFORMATION (UNAUDITED)
During the fiscal year ended August 31, 2000, the Tax-Exempt
Money Market Portfolio paid tax-exempt income distributions in the
amount of $ 7,375,147.
Losses incurred after October 31, within the Portfolios fiscal
year are deemed to arise on the first business day of the following
fiscal year for tax purposes. The Portfolios have incurred and will
elect to defer the following realized losses:
<TABLE>
<CAPTION>
NAME AMOUNT
-------------------------- ------------------------
<S> <C>
U.S. Treasury Money Market $21,835
General Money Market 10,534
Tax-Exempt Money Market 42,330
</TABLE>
7. VOTING RESULTS OF A SPECIAL MEETING OF THE VALIANT FUND SHAREHOLDERS
(UNAUDITED)
A Special Meeting of Shareholders of The Valiant Fund was held
on September 14, 2000 to approve the following four proposals:
Proposal 1 states the shareholders were to approve or
disapprove the Sub-Advisory Agreement in respect of each of the
Portfolios between Integrity Management & Research, Inc. and Reich &
Tang Asset Management L.P.
Proposal 2 states the shareholders were to approve or
disapprove the Sub-Advisory Agreement in respect of each of the
Portfolios between Integrity Management & Research, Inc. and Reich &
Tang Asset Management L.P. to become effective following a proposed
change of control of Reich & Tang Asset Management L.P.
Proposal 3 states the shareholders of the Trust were asked to
elect six Trustees to the Board of Trustees.
Proposal 4 states the shareholders of the Trust were asked to
ratify the selection of independent auditors by the Board of Trustees.
Voting results of the aforementioned proposals were as
follows:
<TABLE>
PROPOSAL 1
<CAPTION>
PORTFOLIO VOTES IN FAVOR VOTES AGAINST VOTES ABSTAINED
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. Treasury Money Market 2,503,465,764.70 -- --
U.S. Treasury Income 618.28 -- --
General Money Market 335,365,458.07 -- --
Tax-Exempt Money Market 177,393,834.04 -- --
-------------------------------------------------------------------------
Total 3,016,225,675.09 -- --
=========================================================================
</TABLE>
(Continued)
27
<PAGE> 30
THE VALIANT FUND
NOTES TO FINANCIAL STATEMENTS
AUGUST 31, 2000
<TABLE>
PROPOSAL 2
<CAPTION>
PORTFOLIO VOTES IN FAVOR VOTES AGAINST VOTES ABSTAINED
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. Treasury Money Market 2,503,465,764.70 -- --
U.S. Treasury Income 618.28 -- --
General Money Market 335,365,458.07 -- --
Tax-Exempt Money Market 177,393,834.04 -- --
-------------------------------------------------------------------------
Total 3,016,225,675.09 -- --
=========================================================================
</TABLE>
<TABLE>
PROPOSAL 3
<CAPTION>
PORTFOLIO VOTES IN FAVOR VOTES AGAINST VOTES ABSTAINED
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. Treasury Money Market 2,503,465,764.70 -- --
U.S. Treasury Income 618.28 -- --
General Money Market 335,365,458.07 -- --
Tax-Exempt Money Market 177,393,834.04 -- --
-------------------------------------------------------------------------
Total 3,016,225,675.09 -- --
=========================================================================
</TABLE>
<TABLE>
PROPOSAL 4
<CAPTION>
PORTFOLIO VOTES IN FAVOR VOTES AGAINST VOTES ABSTAINED
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. Treasury Money Market 2,503,465,764.70 -- --
U.S. Treasury Income 618.28 -- --
General Money Market 335,365,458.07 -- --
Tax-Exempt Money Market 177,393,834.04 -- --
-------------------------------------------------------------------------
Total 3,016,225,675.09 -- --
=========================================================================
</TABLE>
28
<PAGE> 31
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Trustees of The Valiant Fund
In our opinion, the accompanying statement of assets and liabilities, including
the schedules of portfolio investments, 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 U.S. Treasury Money Market
Portfolio, U.S. Treasury Income Portfolio, General Money Market Portfolio, and
Tax-Exempt Money Market Portfolio (separate portfolios constituting The Valiant
Fund, hereafter referred to as the "Funds") at August 31, 2000, the results of
each of their operations for the periods then ended, the changes in each of
their net assets for the periods presented and the financial highlights for each
of the periods presented, in conformity with accounting principles generally
accepted in the United States of America. 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 auditing standards
generally accepted in the United States of America, 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 at August
31, 2000 by correspondence with the custodian and brokers, provide a reasonable
basis for the opinion expressed above.
PricewaterhouseCoopers LLP
Columbus, Ohio
October 18, 2000
29
