IOWA SCHOOLS JOINT
INVESTMENT TRUST
INTERIM FINANCIAL REPORT
DECEMBER 31, 1997
SPONSORED BY THE
IOWA ASSOCIATION OF SCHOOL BOARDS
<PAGE>
TRUSTEES' REPORT
- - ----------------
To Iowa Schools Joint Investment Trust Participants:
The Iowa Schools Joint Investment Trust (ISJIT) is pleased to present this
semi-annual report of Trust operations for the period ended December 31, 1997.
During 1997, market rates for short-term securities were relatively constant by
historical standards. ISJIT maintained a consistent focus upon its three
complementary investment objectives; protection of invested participant funds,
maintaining the necessary degree of liquidity to accommodate participant needs
and providing participants with an excellent market rate of return.
Included in this report is a summary of liquid rates for 1997 and each preceding
calendar year. Rates earned by ISJIT participants were reflective of the general
trend in interest rates throughout the year.
Participation in ISJIT's investment programs continues to grow and serve
additional participants. As of December 31, 1997, a total of 323 school
corporations and other eligible organizations formed under Iowa Code chapter 28E
were authorized to invest in ISJIT. During the period, total assets invested
within the liquid funds ranged from a low of $129,478,644 to a high of
$294,641,135. When fixed term securities are included, the respective figures
range from a low of $242,552,275 to a high of $430,165,621. Total funds invested
on each day in 1997 were greater than total funds invested on the same day for
all previous years.
The Board of Trustees is very pleased with the success of the ISJIT cash
management program and would welcome any comments or suggestions that you might
have. Our goal is to provide a cash management program that is always responsive
to its member's needs.
Respectfully,
Don Williams, Chair
Board of Trustees
<PAGE>
MANAGEMENT DISCUSSION
- - ---------------------
During the last half of the fiscal year, short-term interest rates were stable.
The domestic U.S. economy remains strong. The lowest unemployment rate since
1973 and wages rising at the fastest pace in a decade will likely keep consumer
spending vigorous. Home sales are at record levels due to the recent decline in
mortgage rates. Businesses continue to invest in technology to improve
efficiency in a competitive marketplace.
The turmoil in Asia, however, will likely dampen economic growth. The Federal
Reserve is unlikely to raise short-term interest rates until the impact of Asia
on the U.S. economy becomes more clear. Once Asia stabilizes, however, the
strength of the domestic economy will again be the focus of the Federal Reserve
and short-term interest rates may edge higher.
The rate on the ISJIT Diversified Fund exceeded five percent in each of the last
six months. The portfolio consistently provided a rate more than 0.20 percent
greater than the Donoghue Index of national money market funds.
The average maturity of the ISJIT Diversified Fund was 36 days on December 31,
1997. The average maturity is being maintained at a shorter level, since there
is little yield difference between overnight and six month investments.
The ISJIT program emphasizes three elements: safety, liquidity, and competitive
rates in that order. We look forward to serving you in 1998.
Sincerely,
Kathryn D. Beyer, CFA
Managing Director
Investors Management Group
<PAGE>
IOWA SCHOOLS JOINT INVESTMENT TRUST
DIVERSIFIED PORTFOLIO
STATEMENT OF NET ASSETS
DECEMBER 31, 1997
(SHOWING PERCENTAGE OF NET ASSETS)
- - ----------------------------------
<TABLE>
<CAPTION>
YIELD AT
TIME OF AMORTIZED
PAR VALUE DESCRIPTION PURCHASE DUE DATE COST
- - -------------- -------------------------------------------- -------- ---------- -------------
<S> <C> <C> <C> <C>
DISCOUNTED GOVERNMENT SECURITIES -- 10.38%
$ 8,185,000 Federal National Mtge. Assoc.-Disc. Note 5.63% 02/06/98 $ 8,140,105
5,000,000 Fed. Home Loan Mtge Corp.-Disc. Note 5.68% 02/12/98 4,967,742
5,000,000 Fed. Home Loan Mtge Corp.-Disc. Note 5.64% 02/12/98 4,967,975
-------------
TOTAL (cost-- $18,075,822) $ 18,075,822
-------------
COUPON SECURITIES -- 37.35%
$ 5,000,000 Federal National Mtge. Assoc., 6.05% 5.82% 01/12/98 $ 5,000,134
2,000,000 Federal National Mtge. Assoc., 6.02% 5.74% 01/20/98 2,000,165
5,000,000 Federal National Mtge. Assoc., 7.93% 5.97% 01/20/98 5,004,499
5,000,000 Student Loan Marketing Assoc., Variable Rate 5.30% 01/21/98 5,000,288
1,000,000 Federal Home Loan Bank, 5.60% 5.68% 01/23/98 999,896
1,500,000 Fed. Nat'l Mtge. Assoc., Variable Rate 5.89% 02/17/98 1,500,198
2,000,000 Federal Home Loan Bank, 5.14% 6.10% 02/20/98 1,997,456
2,000,000 Federal National Mtge. Assoc., 5.62% 5.84% 02/23/98 1,999,119
5,000,000 Federal Home Loan Bank, 7.32% 5.89% 02/24/98 5,009,317
1,278,000 Student Loan Marketing Assoc., 5.54% 5.94% 02/25/98 1,277,233
3,000,000 Student Loan Marketing Assoc., 7.00% 6.03% 03/03/98 3,004,616
1,000,000 Federal National Mtge. Assoc., 0.00% 5.65% 03/09/98 989,662
3,000,000 Federal National Mtge. Assoc., 8.20% 5.62% 03/10/98 3,013,904
1,000,000 Federal National Mtge. Assoc., 5.71% 5.88% 03/18/98 999,667
1,000,000 Federal National Mtge. Assoc., 5.71% 5.68% 03/18/98 1,000,055
1,000,000 Federal National Mtge. Assoc., 5.25% 6.10% 03/25/98 998,136
1,000,000 Federal National Mtge. Assoc., 5.25% 6.09% 03/25/98 998,153
1,500,000 Federal National Mtge. Assoc., 5.35% 5.71% 04/01/98 1,498,621
5,000,000 Fed. Nat'l Mtge. Assoc., Variable Rate 5.84% 04/15/98 4,999,439
2,050,000 Fed. Home Loan Mtge. Corp., 5.31% 5.69% 04/29/98 2,047,447
2,500,000 Federal National Mtge. Assoc., 5.40% 5.90% 05/28/98 2,495,053
1,500,000 Fed. Home Loan Mtge Corp., Variable Rate 5.90% 06/30/98 1,502,091
4,000,000 Federal Home Loan Bank, Variable Rate 5.72% 10/23/98 3,998,958
3,000,000 Student Loan Marketing Assoc., Variable Rate 5.75% 11/05/98 3,000,160
4,750,000 Student Loan Marketing Assoc., Variable Rate 5.71% 01/13/99 4,735,450
-------------
TOTAL (cost-- $65,069,717) $ 65,069,717
-------------
See Notes to Financial Statements.
<PAGE>
IOWA SCHOOLS JOINT INVESTMENT TRUST
DIVERSIFIED PORTFOLIO
STATEMENT OF NET ASSETS, CONTINUED
DECEMBER 31, 1997
(SHOWING PERCENTAGE OF NET ASSETS)
YIELD AT
TIME OF AMORTIZED
PAR VALUE DESCRIPTION PURCHASE DUE DATE COST
- - -------------- ---------------------------------------------- --------- ---------- -------------
CERTIFICATES OF DEPOSIT -- 17.15%
$ 250,000 Citizens Bank, Sac City 5.90% 01/05/98 $ 250,000
250,000 Citizens Bank, Sac City 5.95% 01/05/98 250,000
2,500,000 Bankers Trust, Des Moines 5.70% 01/05/98 2,500,000
2,000,000 First State Bank, Conrad 5.68% 01/06/98 2,000,000
1,000,000 Ottumwa Savings Bank, Ottumwa 5.80% 01/23/98 1,000,000
500,000 Peoples Bank & Trust, Rock Valley 5.95% 01/26/98 500,000
2,000,000 DeWitt Bank & Trust, DeWitt 5.90% 01/27/98 2,000,000
750,000 Farmers State Bank, Hawarden 5.75% 01/30/98 750,000
1,000,000 Ottumwa Savings Bank, Ottumwa 5.78% 02/11/98 1,000,000
250,000 Ft. Madison Bank & Tr, Ft. Madison 6.10% 02/18/98 250,000
2,500,000 Norwest Bank, Pleasant Hill 5.90% 02/18/98 2,500,000
500,000 American Bank, LeMars 5.90% 02/20/98 500,000
500,000 Union State Bank, Winterset 5.95% 02/20/98 500,000
300,000 First State Bank, Ida Grove 5.80% 03/02/98 300,000
500,000 American Bank, LeMars 5.90% 03/05/98 500,000
1,000,000 Mercantile Bank, Cedar Rapids 5.90% 03/06/98 1,000,000
500,000 Union State Bank, Monona 5.90% 03/09/98 500,000
1,500,000 St. Ansgar State Bank, St. Ansgar 5.90% 03/10/98 1,500,000
500,000 Peoples Bank, Elkader 5.85% 03/18/98 500,000
500,000 Peoples Bank & Trust, Rock Valley 6.05% 03/20/98 500,000
2,500,000 Bankers Trust, Des Moines 5.85% 03/23/98 2,500,000
500,000 Citizens Bank, Sac City 5.80% 04/13/98 500,000
500,000 St. Ansgar State Bank, St. Ansgar 5.90% 04/20/98 500,000
500,000 Premier Bank, Rock Valley 5.90% 05/18/98 500,000
675,000 Mercantile Bank, Mt. Pleasant 5.90% 05/20/98 675,000
300,000 First State Bank, Ida Grove 5.90% 06/01/98 300,000
500,000 Peoples State Bank, Elkader 5.90% 06/22/98 500,000
500,000 Peoples Savings Bank, Elma 5.95% 06/22/98 500,000
500,000 Peoples Savings Bank, Elma 5.95% 06/22/98 500,000
300,000 Community Bank, Miles 6.30% 08/10/98 300,000
See Notes to Financial Statements.
<PAGE>
IOWA SCHOOLS JOINT INVESTMENT TRUST
DIVERSIFIED PORTFOLIO
STATEMENT OF NET ASSETS, continued
DECEMBER 31, 1997
(SHOWING PERCENTAGE OF NET ASSETS)
YIELD AT
TIME OF AMORTIZED
PAR VALUE DESCRIPTION PURCHASE DUE DATE COST
- - -------------- ---------------------------------------------- -------- ---------- --------------
$ 250,000 Ft. Madison Bank & Tr, Ft. Madison 6.05% 08/21/98 $ 250,000
500,000 DeWitt Bank & Trust, DeWitt 6.05% 09/04/98 500,000
250,000 First Bank & Trust, Rock Rapids 6.10% 09/16/98 250,000
500,000 First American Bank, Ames 6.00% 09/18/98 500,000
2,500,000 Norwest Bank, Clive 6.10% 11/12/98 2,500,000
300,000 Community Bank, Miles 6.10% 12/11/98 300,000
-------------
TOTAL (cost-- $29,875,000) $ 29,875,000
-------------
REPURCHASE AGREEMENTS (collateralized by U.S. government securities) -- 34.73%
$ 30,257,000 Merrill Lynch, Repurchase Agreement 6.50% 01/02/98 $ 30,257,000
$ 30,256,000 J.P. Morgan, Repurchase Agreement 6.50% 01/02/98 $ 30,256,000
-------------
TOTAL (cost-- $60,513,000) $ 60,513,000
-------------
TOTAL INVESTMENTS-- 99.61% (cost-- $173,533,539) $ 173,533,539
EXCESS OF OTHER ASSETS OVER TOTAL LIABILITIES-- 0.39% $ 682,087
(Includes $37,106 payable to IMG and $772,577 -------------
dividends payable to unitholders)
NET ASSETS-- 100% $ 174,215,626
Applicable to 174,215,626 outstanding units =============
NET ASSET VALUE: $ 1.00
Offering and redemption price per unit ($174,215,626 =============
divided by 174,215,626 units outstanding)
</TABLE>
See Notes to Financial Statements.
<PAGE>
IOWA SCHOOLS JOINT INVESTMENT TRUST
DIRECT GOVERNMENT OBLIGATION PORTFOLIO
STATEMENT OF NET ASSETS
DECEMBER 31, 1997
(SHOWING PERCENTAGE OF NET ASSETS)
- - ----------------------------------
<TABLE>
<CAPTION>
YIELD AT
TIME OF AMORTIZED
PAR VALUE DESCRIPTION PURCHASE DUE DATE COST
- - -------------- ------------------------------------------------ --------- --------- --------------
<S> <C> <C> <C> <C>
COUPON SECURITIES -- 6.45%
$ 1,000,000 U. S. Treasury Note, 7.25% 5.75% 02/15/98 $ 1,001,841
1,000,000 U. S. Treasury Note, 6.13% 6.02% 03/31/98 1,000,253
------------
TOTAL (cost-- $2,002,094) $ 2,002,094
------------
REPURCHASE AGREEMENTS (collateralized by U.S. government securities) -- 93.87%
$ 29,130,000 SBC Warburg, Repurchase Agreement 6.40% 01/02/98 $ 29,130,000
------------
TOTAL (cost-- $29,130,000) $ 29,130,000
------------
TOTAL INVESTMENTS-- 100.32% (cost-- $31,132,094) $ 31,132,094
EXCESS OF OTHER ASSETS OVER TOTAL LIABILITIES-- (0.32%) ($ 98,210)
(Includes $3,944 payable to IMG and $130,477 ------------
dividends payable to unitholders)
NET ASSETS-- 100% $ 31,033,884
Applicable to 31,033,884 outstanding units ============
NET ASSET VALUE: $ 1.00
Offering and redemption price per unit ($31,033,884 ============
divided by 31,033,884 units outstanding)
</TABLE>
See Notes to Financial Statements.
<PAGE>
IOWA SCHOOLS JOINT INVESTMENT TRUST
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED DECEMBER 31, 1997
- - ------------------------------------------
DIRECT GOVERNMENT
DIVERSIFIED PORTFOLIO OBLIGATION PORTFOLIO
--------------------- --------------------
INVESTMENT INCOME:
Interest $ 4,259,677 $ 840,028
------------- -------------
EXPENSES:
Investment advisory and
program support fees 185,972 22,522
Custody and administrative fees 167,832 48,798
Distribution fees 75,040 15,015
Other fees and expenses 22,513 4,505
------------- -------------
TOTAL EXPENSES 451,357 90,840
------------- -------------
NET INVESTMENT INCOME $ 3,808,320 $ 749,188
============= =============
See Notes to Financial Statements.
<PAGE>
IOWA SCHOOLS JOINT INVESTMENT TRUST
STATEMENT OF CHANGES IN NET ASSETS
FOR THE SIX MONTHS ENDED DECEMBER 31, 1997 AND 1996
<TABLE>
<CAPTION>
DIRECT GOVERNMENT
DIVERSIFIED PORTFOLIO OBLIGATION PORTFOLIO
1997 1996 1997 1996
------------------------------------- ---------------------------------
<S> <C> <C> <C> <C>
From Investment Activities:
Net investment income
distributed to unitholders $ 3,808,320 $ 3,141,952 $ 749,188 $ 514,869
================ ================ ============== ===============
From Unit Transactions:
(at constant net asset
value of $1 per unit)
Units sold $ 490,976,151 $ 496,532,346 $ 16,331,362 $ 17,759,495
Units issued in reinvest-
ment of dividends from
net investment income 3,808,320 3,141,952 749,188 514,869
Units redeemed (515,820,286) (510,011,213) (16,026,647) (15,214,369)
---------------- ---------------- -------------- ---------------
Net increase/(decrease)
in net assets derived
from unit transactions (21,035,815) (10,336,915) 1,053,903 (3,059,995)
Net assets at
beginning of period 195,251,441 171,554,264 29,979,981 22,721,807
---------------- ---------------- -------------- ---------------
Net assets at end
of six months $ 174,215,626 $ 161,217,349 $ 31,033,884 $ 25,781,802
================ ================ ============== ===============
</TABLE>
See Notes to Financial Statements.
<PAGE>
IOWA SCHOOLS JOINT INVESTMENT TRUST
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
SELECTED DATA FOR A UNIT PORTFOLIO
OUTSTANDING THROUGH EACH PERIOD
- - -------------------------------
1997 1996 1995 1994 1993 1992 1991 1990 1989 1988
---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
IOWA SCHOOLS JOINT INVESTMENT
TRUST DIVERSIFIED PORTFOLIO
Net Asset Value,
Beginning of Period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
Net Investment Income .051 .049 .053 .043 .027 .031 .073 .073 .080 .073
Dividends Distributed (.051) (.049) (.053) (.043) (.027) (.031) (.073) (.073) (.080) (.073)
---------------------------------------------------------------------------------------------------
Net Asset Value,
End of Period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
===================================================================================================
Total Return 5.08% 4.85% 5.31% 4.33% 2.68% 3.11% 7.26% 7.27% 8.05% 7.26%
Ratio of Expenses
to Average Net Assets 0.60% 0.60% 0.59% 0.59% 0.58% 0.58% 0.62% 0.66% 0.67% 0.67%
Ratio of Net Income to
Average Net Assets 5.08% 4.85% 5.31% 4.33% 2.68% 3.11% 7.26% 7.27% 8.05% 7.26%
Net Assets,
End of Period
(000 Omitted) $174,215 $161,217 $166,018 $128,985 $143,987 $143,378 $110,353 $103,212 $ 60,102 $ 58,366
</TABLE>
See Notes to Financial Statements.
<PAGE>
IOWA SCHOOLS JOINT INVESTMENT TRUST
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
SELECTED DATA FOR A UNIT PORTFOLIO
OUTSTANDING THROUGH EACH PERIOD
- - -------------------------------
1997 1996 1995 1994 1993 1992 1991 1990 1989
----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
IOWA SCHOOLS JOINT INVESTMENT TRUST
DIRECT GOVERNMENT OBLIGATION PORTFOLIO
Net Asset Value,
Beginning of Period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
Net Investment Income .050 .047 .052 .042 .025 .030 .049 .073 .080
Dividends Distributed (.050) (.047) (.052) (.042) (.025) (.030) (.049) (.073) (.080)
-----------------------------------------------------------------------------------------
Net Asset Value,
End of Period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
=========================================================================================
Total Return 4.99% 4.68% 5.21% 4.23% 2.54% 2.98% 4.93% 7.28% 8.05%
Ratio of Expenses
to Average Net Assets .60% 0.60% 0.59% 0.59% 0.58% 0.58% 0.62% 0.65% 0.65%
Ratio of Net Income to
Average Net Assets 4.99% 4.68% 5.21% 4.23% 2.54% 2.98% 4.93% 7.28% 8.05%
Net Assets,
End of Period
(000 Omitted) $ 31,034 $ 25,781 $ 34,801 $ 27,743 $ 32,508 $ 28,713 $ 29,228 $ 27,443 $ 18,688
</TABLE>
See Notes to Financial Statements.
<PAGE>
IOWA SCHOOLS JOINT INVESTMENT TRUST
NOTES TO FINANCIAL STATEMENTS
- - -----------------------------
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION
Iowa Schools Joint Investment Trust (ISJIT) is a common law trust
established under Iowa law pursuant to Chapter 28E and Section 279.29, Iowa
Code (1985), as amended, which authorizes Iowa schools to jointly invest
moneys pursuant to a joint investment agreement. ISJIT is registered under
the Investment Company Act of 1940. ISJIT was established by the adoption
of a Joint Powers Agreement and Declaration of Trust as of October 1, 1986,
and commenced operations on December 16, 1986. The Joint Powers Agreement
and Declaration of Trust was amended September 22, 1988, and again on May
1, 1993. As amended, ISJIT is authorized and now operates three investment
programs: 1) the Diversified Portfolio, 2) the Direct Government Obligation
Portfolio, and 3) the Fixed Term Automated (FTA) Investment Program. The
objective of the portfolios is to maintain a high degree of liquidity and
safety of principal through investment in short-term securities as
permitted for Iowa schools under Iowa law. The objective of the FTA
Investment Program is to provide individual public agency ownership of
investments in legally permissible individual securities which offer fixed
rates of return and fixed maturities. Norwest Bank Iowa, N.A. serves as
ISJIT's Administrator and Custodian, and Investors Management Group serves
as the Investment Advisor.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of increase and decrease in
net assets from operations during the period. Actual results could differ
from those estimates.
INVESTMENTS IN SECURITIES
The Diversified and Direct Government Obligation Portfolios consist of cash
and short-term investments valued at amortized cost pursuant to Rule 2a-7
under the Investment Company Act of 1940. This involves valuing a portfolio
security at its original cost on the date of purchase, and thereafter
amortizing any premium or discount on a straight-line basis to maturity.
The amount of premium or discount amortized to income under the
straight-line method does not differ materially from the amount which would
be amortized to income under the interest method. Procedures are followed
to maintain a constant net asset value of $1.00 per unit for each
portfolio.
Security transactions are accounted for on the trade date. Interest income,
including the accretion of discount and amortization of premium, is
recorded on the accrual basis.
Under Governmental Accounting Standards as to custodial credit risk,
ISJIT's investments in securities are classified as category one. Category
one is the most secure investment category description.
Certificates of deposit amounts in excess of the $100,000 federal deposit
insurance are collateralized as required by Iowa law, including the
security provided by the State of Iowa's sinking fund for public deposits.
<PAGE>
IOWA SCHOOLS JOINT INVESTMENT TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- - -----------------------------------------
In connection with transactions in repurchase agreements, it is ISJIT's
policy that its Custodian take possession of the underlying collateral
securities, the value of which exceeds the principal amount of the
repurchase transaction, including accrued interest at all times. If the
seller defaults, and the value of the collateral declines, realization of
the collateral by ISJIT may be delayed or limited. At June 30, 1996 the
securities purchased under overnight agreements to resell were
collateralized by government agency securities with market values of
$61,735,942 and $29,713,312 for the Diversified Portfolio and the Direct
Government Obligation Portfolio, respectively.
UNIT ISSUES, REDEMPTIONS, AND DISTRIBUTIONS
ISJIT determines the net asset value of each portfolio account daily. Units
are issued and redeemed daily at the daily net asset value. Dividends from
net investment income for each portfolio is declared daily and distributed
monthly.
INCOME TAXES
ISJIT is exempt from federal and state income tax.
FEES AND EXPENSES
Under separate agreements with ISJIT, Investors Management Group (IMG), the
Investment Advisor and Program Support Provider, and Norwest Bank, Iowa,
N.A. (Norwest), the Custodian and Administrator are paid an annual fee for
operating the investment programs. For each of the portfolios, IMG receives
.150 percent of the average daily net asset value up to $150 million and
.125 percent exceeding $150 million for investment advisor fees. In
addition, IMG receives .10 percent of the average daily net asset value of
the Diversified Portfolio for program support fees. For the period ended
December 31, 1997, the Diversified Portfolio and the Direct Government
Obligation Portfolio paid $185,972 and $22,522, respectively to IMG for
services provided. For each of the portfolios, Norwest receives .050
percent of the average daily net asset value up to $150 million, .045
percent from $150 to $200 million, and .040 percent exceeding $200 million
for custodial services. For the Diversified Portfolio, Norwest receives
.175 percent of the average daily net asset value up to $150 million, .165
percent from $150 to $200 million, and .150 percent exceeding $200 million;
for the Direct Government Obligation Portfolio, Norwest receives .275
percent of the average daily net asset value up to $150 million, .265
percent from $150 to $200 million, and .250 percent exceeding $200 million
for administrative services. For the period ended December 31, 1997, the
Diversified Portfolio and the Direct Government Obligation Portfolio paid
$167,832 and $48,798 respectively to Norwest for services provided. Under a
distribution plan, the sponsoring association receives an annual fee of .10
percent of the daily net asset value of the portfolios. For the period
ended December 31, 1997, the Diversified Portfolio and the Direct
Government Obligation Portfolio paid $75,040 and $15,015 respectively to
the Iowa Association of School Boards. ISJIT is responsible for operating
expenses incurred directly by ISJIT. All fees are computed daily and paid
monthly.
(2) SECURITIES TRANSACTIONS
Purchases of portfolio securities for the Diversified Portfolio and Direct
Government Obligation Portfolio aggregated $6,218,633,605 and
$3,441,949,000 respectively for the six months ended December 31, 1997.
Proceeds from maturities of securities for the Diversified Portfolio and
Direct Government Obligation Portfolio aggregated $6,239,235,181 and
$3,440,761,000, respectively for the six months ended December 31, 1997.
<PAGE>
BOARD OF TRUSTEES
DON WILLIAMS, CHAIR, Villisca
DEAN BORG, VICE CHAIRPERSON, Mount Vernon
GARY D. BENGSTEN, TREASURER, Carroll
BARB GROHE, TRUSTEE, Iowa City
RICHARD VANDE KIEFT, TRUSTEE, Cedar Falls
CAROLYN JONS, TRUSTEE, Ames
SERVICE PROVIDERS
INVESTMENT ADVISOR:
Investors Management Group
2203 Grand Avenue
Des Moines, IA 50312-5338
CUSTODIAN AND ADMINISTRATOR:
Norwest Bank Iowa, N.A.
666 Walnut, P.O. Box 837
Des Moines, IA 50304
LEGAL COUNSEL:
Ahlers, Cooney, Dorweiler, Haynie,
Smith & Allbee, P.C.
100 Court Avenue
Des Moines, IA 50309
INDEPENDENT AUDITORS:
KPMG Peat Marwick LLP
2500 Ruan Center
Des Moines, IA 50309
FOR INVESTMENT INFORMATION . . .
c/o Norwest Bank Iowa, N.A.
666 Walnut, P.O. Box 837
Des Moines, Iowa 50304
Toll Free (800) 872-0140 or (515) 245-3245
