<PAGE>
THE
PARKSTONE
ADVANTAGE
[PHOTO APPEARS HERE]
Semi-Annual Report
June 30, 1997
Not FDIC Insured
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Table of Contents
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The Parkstone Advantage Fund June 30, 1997
<TABLE>
<S> <C>
Message From Your Chairman.................................................. 2
Message From Your Investment Adviser........................................ 2
Portfolio Performance Discussion............................................ 4
Statements of Assets and Liabilities........................................ 9
Statements of Operations.................................................... 10
Statements of Changes in Net Assets......................................... 11
Schedules of Portfolio Investments.......................................... 13
Notes to Financial Statements............................................... 22
Financial Highlights........................................................ 27
</TABLE>
1
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Message From Your Chairman and Investment Adviser
- -------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1997
Dear Shareholders:
We're pleased to report that the six months ended June 30, 1997, was a period
of strong growth for the financial markets, and for the Parkstone Advantage
Fund. Over the course of the six-month period ended June 30, 1997, the Dow
Jones Industrial Average gained over 1225 points. While bonds attracted less
attention and generated less excitement than stocks, they, too, posted posi-
tive returns for the period.
Much of this activity was fueled by investors who continued to invest in mu-
tual funds at record levels. During the first half of 1997 alone, net assets
under management in the Parkstone Advantage Funds grew by $10.4 million from
78.9 million to $89.3 million, an increase of 13.2%. Moreover, at the end of
March, assets under management by First of America Investment Corporation to-
taled some $14.3 billion dollars.
TURNING TO THE MARKETS . . .
After climbing relentlessly higher for two years, stocks took a dive in March
and April. Consensus opinion was that a substantial correction had begun. With
economic growth numbers so strong, the Federal Reserve had just raised inter-
est rates. Moreover, the expectation was that, somewhat like 1994, they would
continue to do so until the economy softened, and perhaps, to investors' way
of thinking, a recession ensued. But those glum feelings didn't last. Like a
phoenix rising from the ashes, the stock market went on to hit new all-time
record highs day after day throughout the second quarter of 1997.
In short, the market took a licking and kept right on ticking. Why? First and
foremost, after the 1/4% increase in March, the Federal Reserve reassessed its
position and has not moved since. This is most unusual for Alan Greenspan and
crew. But they have good reasons. Economic growth cooled from 5.9% in the
first quarter to a more moderate 2%-3% in the second. News on the inflation
front is also very good--the core Consumer Price Index rate of inflation for
the 12 months ending in May is now just 2.5%.
ABOUT AS GOOD AS IT GETS
Low inflation, declining interest rates, increasing corporate profits--why
shouldn't the stock market celebrate? Indeed, as things currently stand, cor-
porate profits have been substantially underestimated by the market. Not only
have companies failed to disappoint, they have, week after week, surprised
virtually everyone in the marketplace.
The bond market, too, has taken notice of strong corporate profits and the es-
sentially benign inflation environment. One year ago, 30-year Treasury bonds
were yielding 7.2%. Last week they yielded 6.63%. With the Federal deficit es-
timated to have continued to shrink to a level of under $100 billion--in fact,
perhaps as low as $50 billion in the current fiscal year--there may be room
for long-term and short-term interest rates to decline further. (Historically,
business cycles do not stop of their own accord, but tend to be subdued by
higher interest rates induced by the Federal Reserve and/or by some unforeseen
external event such as war or other cataclysmic event.) As a result, after
several years of fluctuating in response to every rumor, statistic and eco-
nomic bulletin, the bond markets experienced a relatively tranquil first half
of the year.
CAN IT GET BETTER?
All right, profits look good, inflation looks good, and stock market prices
have never been better. In fact, they are somewhat overvalued, aren't they?
Yes, from a fundamental perspective, things are a little scary. Dividend
yields are too low. Price/earnings ratios are hitting historic highs--and you
would think that, at some point, they will have to return to more realistic
ranges. Ah, that's the key--you would think.
There are times in stock market cycles when the dominant force is market psy-
chology, and, at the moment, psychology looks great. But, beware; it can shift
quickly, or it can buoy a market for years. During the entire decade of the
Sixties, the S&P 500 traded at a price/earnings ratio of between 15 and 20
times earnings. The entire decade--not six days, six months or six years, but
the entire decade!
HOW HIGH IS TOO HIGH?
The common denominator between then and now is a low inflation rate. During
the early Sixties, as measured by the Consumer Price Index, inflation was
4.5%. By
2
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Message From Your Chairman and Investment Adviser, continued
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The Parkstone Advantage Fund June 30, 1997
the mid to late Sixties, it was 3% or less. The conclusion is, although the
stock market may be near the higher end of historic valuations, it is not un-
precedented. With the current level of inflation and interest rates, this valu-
ation could continue for some time. Of course, there could be a nasty 10% to
15% market correction at any time, but there won't be a calamity unless senti-
ment shifts dramatically.
So how high could the market go? Some pundits think we've seen the high. Others
project the Dow at 10,000 by the middle of 1998, and 18,000 by 2005. The truth
of the matter is, no one really knows. But one thing we all do know is that
market sentiment can shift on a dime--for reasons big or very, very small.
IN CLOSING . . .
In the pages that follow, you will find a detailed discussion of the perfor-
mance of each of The Parkstone Advantage Funds during the six months ended June
30, 1997. We urge you to read this material closely.
Finally, we thank you for your continued confidence in us. We look forward to
providing you with superior investment management and to serving your needs now
and in the years ahead. As always, if you have any questions or require any as-
sistance, please don't hesitate to call us at 1-800-451-8377.
Sincerely,
/s/ John B. Rapp
John B. Rapp
Chairman
The Parkstone Advantage Fund
July 25, 1997
/s/ Richard A. Wolf, CFA
Richard A. Wolf, CFA
President and Chief Investment Officer
First of America Investment Corporation
3
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Portfolio Performance Discussion
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The Parkstone Advantage Fund June 30, 1997
MID CAPITALIZATION FUND
While the Dow average gained almost 1000 points during the six months ended
June 30, 1997, the advance was a relatively narrow one. As they have for some
time, investors continued to favor larger capitalization stocks--and often-
times, only the very biggest and best known of those. Moreover, investor senti-
ment also shifted away from growth stocks to value. As a result, many sound
mid-cap and small-cap growth stocks were overlooked--and left behind.
Even in this environment, however, the quality of several of the Fund holdings
won over investors. In the first half of '97 alone, Baan (2.0% of the portfo-
lio's assets), a company involved in enterprise resource planning systems,
soared 98%. McAfee rose 43%, and Tellabs climbed 48% over the same period.
Overall, however, the six months ended June 30, 1997, were frustrating ones as
mid-cap and small- cap companies labored in the shadow of the large- caps. For
the period, the Fund posted a return of 2.95% versus a return of 12.99% for the
S&P Mid-Cap 400, the industry benchmark.
OPPORTUNITIES ABOUND
Overlooked by investors as they stampeded to large-cap stocks over the past
year, small- and mid-cap stocks are now offering investors very real value. In
fact, in comparison to the blue chips, they can even be considered cheap. Obvi-
ously, there is the possibility that the larger stocks will experience a cor-
rection in the coming months--which would bring these stocks more in line with
the rest of the market.
But there is an equally strong possibility that we will see small- and mid-cap
stocks start to catch up with larger stocks. Given the valuations of the blue
chips, we believe it's only a matter of time before investors move to capital-
ize on many of the truly astounding bargains now available in other sectors of
the marketplace.
As of June 30, 1997, the top five holdings in the Fund's portfolio were
HEALTHSOUTH (3.6% of the Fund's assets), Service Corp. (3.2%), Hospitality
Franchise Systems, Inc. (3.1%), McAfee Associates (2.8%) and Sunamerica
(2.8%).*
- -------
* The portfolio's composition is subject to change.
[GRAPH APPEARS HERE]
Return on a $10,000 Investment
(9/93 to 6/97)
<TABLE>
<CAPTION>
Mid Capitalization Fund S&P Mid Cap 400 Index
<S> <C> <C>
9/23/93 $10,000 $10,000
6/94 8,900 9,517
6/95 11,010 11,644
6/96 14,150 14,157
6/97 15,030 17,459
</TABLE>
Average Annual Total Return
As of June 30, 1997
- ---------------------------
Since Inception
(9/23/93)
11.41%
- ---------------------------
One Year
6.22%
- ---------------------------
The Fund's performance is compared to the Standard & Poor's Mid-Cap 400 Index to
reflect the Fund's focus on the mid-cap sector of the U.S. stock market. The
index is unmanaged and does not reflect the deduction of fees associated with a
mutual fund, such as investment management and fund accounting fees. The
performance of the Parkstone Advantage Mid Capitalization Fund reflects the
deduction of fees for these value-added services. Past performance is not
predictive of future results. The total return of the Fund does not reflect the
effect of any insurance charges or the annual maintenance fee. Such charges and
expenses would reduce the performance quoted. The investment return and NAV will
fluctuate, so that an investor's shares, when redeemed, may be worth more or
less then the original cost.
4
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Portfolio Performance Discussion, continued
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The Parkstone Advantage Fund June 30, 1997
SMALL CAPITALIZATION FUND/+/
Very simply, the six months ended June 30, 1997, were frustrating ones for
small-cap growth investors. The market roared to record highs--but gains were
concentrated in a handful of the largest companies. And while all other sectors
of the market were left behind in the stampede, the small-cap sector was tram-
pled. Moreover, despite their fundamental strength and solid prospects, small-
cap growth stocks fared the worst, as what attention investors paid to the sec-
tor focused on value-oriented companies.
Invested primarily in growth-oriented small-cap stocks, the Fund's performance
was impacted by this shift in market sentiment. For the six months ended June
30, 1997, the Fund posted a total return of -4.07% versus a return of 10.20%
for the Russell 2000, which is heavily weighted in value-oriented small-cap
stocks.
LOOKING TOWARD THE FUTURE
Regardless of market sentiment, the prospects for the small-cap growth sector
are very bright indeed. Out of the market's spotlight for almost two years,
these companies have continued to plug away--many growing at a rate as high as
35% a year. Their balance sheets are strong. Their long-term prospects are sol-
id. Yet, many have seen their stock prices fall, or even plummet.
Consequently, valuations in the small-cap growth sector, in comparison to the
large-caps, are now very, very cheap. Attractive opportunities abound in indus-
tries across the market, from health care and technology to financial services
and entertainment companies. In the months ahead, as the economy slows and in-
vestors' infatuation with large-cap issues fades, we expect investors will re-
alize this and return to the sector, seeking growth.
As of June 30, 1997, the top five holdings in the Fund's portfolio were Sanmina
(3.3% of the Fund's assets), Dura Pharmaceuticals (3.3%), Omnicare (3.1%), Con-
cord EFS (2.8%) and Regal Cinemas (2.4%).*
- -------
* The portfolio's composition is subject to change.
/+/ Small-cap funds typically carry additional risks since smaller companies
generally have a higher risk of failure. Historically, stocks of smaller
companies have experienced a greater degree of market volatility than stocks
on average.
[GRAPH APPEARS HERE]
Return on a $10,000 Investment
(9/93 to 6/97)
<TABLE>
<CAPTION>
Small Capitalization Fund Russell 2000 Index
<S> <C> <C>
9/23/93 $10,000 $10,000
6/94 9,320 9,601
6/95 13,410 11,528
6/96 20,260 14,282
6/97 19,542 16,613
</TABLE>
Average Annual Total Return
As of June 30, 1997
- ---------------------------
Since Inception
(9/23/93)
19.43%
- ---------------------------
One Year
-3.55%
- ---------------------------
The Fund's performance is compared to the Russell 2000 Index, which represents
the performance of domestically traded common stocks of small to mid-sized
companies. The index is unmanaged and does not reflect the deduction of fees
associated with a mutual fund, such as investment management and fund accounting
fees. The performance of the Parkstone Advantage Small Capitalization Fund
reflects the deduction of fees for these value-added services. Past performance
is not predictive of future results. The total return of the Fund does not
reflect the effect of any insurance charges or the annual maintenance fee. Such
charges and expenses would reduce the performance quoted. The investment return
and NAV will fluctuate, so that an investor's shares, when redeemed, may be
worth more or less then the original cost.
5
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Portfolio Performance Discussion, continued
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The Parkstone Advantage Fund June 30, 1997
INTERNATIONAL DISCOVERY FUND/+/
Few markets worldwide could compete with the U.S stock market as it continued
the longest and strongest bull run in its history. Nonetheless, the six months
ended June 30, 1997, were very profitable ones for international investors.
Moreover, to the surprise of nearly everyone, the Japanese market proved to be
the best performing major market in U.S. dollars in the second quarter of
1997. With approximately 24% of its assets invested in Japan, the Fund bene-
fited handsomely from the rebound.
Investments in Continental Europe also made solid contributions to performance
as economic activity--helped by the low-interest-rate, low-inflation environ-
ment--continued to pick up. While smaller markets throughout the Pacific Basin
region produced mixed results, activity in any one market was not dramatic
enough to impact performance one way or another. Consequently, for the six
months ended June 30, 1997, the Fund posted a return of 10.92% versus its
benchmark, the EAFE (Morgan Stanley Capital International Europe, Australia
and Far East) Index, which posted a return of 11.21% for the same period.
PROSPECTS WORLDWIDE ARE BRIGHT
Overshadowed by the fantastic performance of the U.S. stock market, markets
worldwide have made solid progress over the past year. In Europe, the driving
force behind stocks has been the prospect of economic union. To be eligible to
join the union, countries have had to implement fiscal and monetary policies
that have led to a low-interest-rate, low-inflationary environment. Whether
the union will materialize or not is still problematic--nonetheless, the fi-
nancial markets on the Continent are beginning to experience some of the bene-
fits of a united Europe.
Also in the news during the period was the British handover of Hong Kong to
China. Clearly, this has created a good deal of uncertainty in the Pacific Ba-
sin markets. But, the success of Hong Kong has not been lost on the Chinese
people, or on the Chinese government. We strongly believe that Hong Kong will
have a much greater influence on China than China does on Hong Kong. Early in
the next century, we expect China to become one of the economic powerhouses of
the world--and to offer investors truly enormous growth potential.
As of June 30, 1997, the Fund was widely diversified, with 89 holdings in 25
different markets. Approximately 42% of the portfolio's assets were invested
in Continental Europe, 24% in Japan, 9% in the United Kingdom, 8% in Latin
America, 4% in Canada and 11% in other smaller markets around the world.
As of the same date, the Fund's top five holdings were Rohm (2.5% of the port-
folio's assets), Takeda Chemical (2.5%), Telebras-Spons (2.2%), TDK Corp.
(2.2%) and Oce-Van Der Grinten (2.0%).*
- -------
* The portfolio's composition is subject to change.
/+/ International investing involves increased risk and volatility.
[GRAPH APPEARS HERE]
Return on a $10,000 Investment
(9/93 to 6/97)
<TABLE>
<CAPTION>
International Discovery Fund MSCI EAFE Index
<S> <C> <C>
9/23/93 $10,000 $10,000
6/94 10,250 10,994
6/95 10,290 11,208
6/96 11,690 12,735
6/97 13,557 14,411
</TABLE>
Average Annual Total Return
As of June 30, 1997
- ---------------------------
Since Inception
(9/23/93)
8.40%
- ---------------------------
One Year
15.97%
- ---------------------------
The Fund's performance is compared to the Morgan Stanley Capital International
Europe, Australia and Far East (EAFE) Index, which represents the performance of
the major stock markets in those regions. The index is unmanaged and does not
reflect the deduction of fees associated with a mutual fund, such as investment
management and fund accounting fees. The performance of the Parkstone Advantage
International Discovery Fund reflects the deduction of fees for these value-
added services. Past performance is not predictive of future results. The total
return of the Fund does not reflect the effect of any insurance charges or the
annual maintenance fee. Such charges and expenses would reduce the performance
quoted. The investment return and NAV will fluctuate, so that an investor's
shares, when redeemed, may be worth more or less then the original cost.
6
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Portfolio Performance Discussion, continued
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The Parkstone Advantage Fund June 30, 1997
BOND FUND
The six months ended June 30, 1997, were relatively quiet in the fixed-income
markets. Growth over the course of the period was stronger than anticipated,
but inflation pressures remained benign. Moreover, the Federal Reserve's move
to increase rates modestly in early spring quickly stamped out any sparks that
might have been threatening to ignite. Rates spurted higher briefly, then
gradually fell back as the economy showed signs of softening as the period
drew to a close.
Rather than attempting to chase rates and call each turn, we focused on yield
enhancement instead of on price appreciation. Also, the average maturity of
the portfolio was maintained at a level slightly under the industry average.
Given the strength of corporate balance sheets, corporate bonds were strong
performers throughout the period, and the Fund benefited from its heavy
weighting in the sector. Mortgage-backed securities also made a solid contri-
bution to performance. As a result, for the six months ended June 30, 1997,
the Fund performed in line with its benchmark, the Salomon Brothers Broad In-
dex, and produced a total return of 2.32%.
SUNNY SKIES, FEW CLOUDS
Barring a major disruption in the economy, we expect the environment in the
fixed-income markets to continue to be relatively calm over the next several
months. While the rate of corporate profit growth may decline, in balance
sheets are in the best shape they've been for years. News from markets outside
the United States is good, too. Finally, the market is now beginning to recog-
nize and adjust for the possibility that Federal borrowing needs may decline,
the budget deficit does actually shrink in the months ahead, opening the door
for lower rates. And, with the surprise element taken out of the equation, the
result is likely to be simply a firmer market for government bonds in the fu-
ture.
As of June 30, 1997, approximately 37% of the Fund's assets were invested in
corporate bonds, 14% in mortgage-backed and asset-backed securities, 23% in
U.S. Treasuries, with the remainder invested in agency-backed securities and
cash & cash equivalents. As of the same date, the average credit quality of
the portfolio was Aaa; the average maturity, 9.5 years.*
- -------
* The portfolio's composition is subject to change.
[GRAPH APPEARS HERE]
Return on a $10,000 Investment
(9/93 to 6/97)
<TABLE>
<CAPTION>
Bond Fund Salomon Brothers Broad Index
<S> <C> <C>
9/23/93 $10,000 $10,000
6/94 9,470 9,628
6/95 10,462 10,836
6/96 10,793 11,375
6/97 11,487 12,304
</TABLE>
Average Annual Total Return
As of June 30, 1997
- ---------------------------
Since Inception
(9/23/93)
3.74%
- ---------------------------
One Year
6.43%
- ---------------------------
The Fund's performance is compared to the Salomon Brothers Broad Index, which
represents the performance of the overall bond market. The index is unmanaged
and does not reflect the deduction of fees associated with a mutual fund, such
as investment management and fund accounting fees. The performance of the
Parkstone Advantage Bond Fund reflects the deduction of fees for these value-
added services. Past performance is not predictive of future results. The total
return of the Fund does not reflect the effect of any insurance charges or the
annual maintenance fee. Such charges and expenses would reduce the performance
quoted. The investment return and NAV will fluctuate, so that an investor's
shares, when redeemed, may be worth more or less than the original cost.
7
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Portfolio Performance Discussion, continued
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The Parkstone Advantage Fund June 30, 1997
PRIME OBLIGATIONS FUND/+/
Stronger than expected economic growth caused investors to keep a wary watch on
inflation numbers during the six months ended June 30, 1997. But, contrary to
historical precedent, increased economic activity did not increase inflationary
pressures. Nevertheless, the Federal Reserve hiked interest rates 1/4% in the
first quarter. Whatever inflation anxiety lingered in the marketplace was ef-
fectively doused. As a result, while some sectors of the market were more ac-
tive than others, the overall environment was relatively stable.
Clearly, much of investors' apprehensiveness regarding inflation has dissipated
in recent months as growth has weakened slightly. In fact, there is growing
sentiment in the marketplace for a lowering of rates. But, Federal Reserve ac-
tion has always trailed rather than led the markets, so a dramatic change in
this direction seems somewhat unlikely in the very near term. Nonetheless, with
the economy softening and inflation anxieties disappearing, minus a major
change in the environment, rates may drift lower of their own accord in the
months ahead.
Yet, given the economy's strength over the past two years, we expect to ap-
proach the marketplace cautiously in the weeks prior to the Federal Reserve's
August meeting. Maturities have been lengthened slightly. At the same time, we
have maintained the flexibility to respond quickly to any surprise the economy
might offer, or to increase rates by the Federal Reserve.
As of June 30, 1997, approximately 52.4% of the Fund's assets were invested in
commercial paper, with the remainder invested in overnight securities. The av-
erage maturity of the Fund's holdings was 60 days.*
- -------
* The portfolio's composition is subject to change.
/+/ An investment in the Funds is neither insured nor guaranteed by the U.S.
Government. Yields will fluctuate, and there can be no assurance that the
Funds will be able to maintain a stable net asset value of $1.00 per share.
8
<PAGE>
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Statement of Assets and Liabilities
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1997
(Unaudited)
<TABLE>
<CAPTION>
PRIME MID SMALL INTERNATIONAL
OBLIGATIONS BOND CAPITALIZATION CAPITALIZATION DISCOVERY
FUND FUND FUND FUND FUND
----------- ----------- -------------- -------------- -------------
<S> <C> <C> <C> <C> <C>
ASSETS:
Total Investments, at
value (Total cost
$2,093,681;
$10,362,275;
$24,043,919;
$20,823,646; and
$15,232,056,
respectively).......... $2,093,681 $10,403,557 $27,837,428 $27,204,780 $20,228,461
Repurchase agreements,
at cost................ 1,324,000 -- -- -- --
---------- ----------- ----------- ----------- -----------
Total Investments....... 3,417,681 10,403,557 27,837,428 27,204,780 20,228,461
Cash.................... 240 -- 469 313 1,485
Interest and dividends
receivable............. 1,590 141,987 10,536 6,527 30,584
Reclaim receivable...... -- -- -- -- 8,927
Receivable from brokers
for investments sold... -- -- 68,254 71,297 123,058
Unamortized organization
costs.................. 3,308 2,972 2,356 2,356 1,579
Prepaid expenses and
other assets........... 4,953 1,016 4,017 6,177 8,878
---------- ----------- ----------- ----------- -----------
Total Assets............ 3,427,772 10,549,532 27,923,060 27,291,450 20,402,972
---------- ----------- ----------- ----------- -----------
LIABILITIES:
Dividends payable....... 9,532 -- -- -- --
Payable for investments
purchased.............. -- -- -- 136,180 45,626
Payable for foreign
exchange loss.......... -- -- -- -- 215
Other Payables.......... -- -- -- -- 3,323
Cash overdraft.......... -- 9,247 -- -- --
Accrued expenses and
other payables:
Investment advisory
fees................. 37 214 764 731 696
Administration fees... 557 1,716 4,461 4,237 3,277
Custodian fees........ -- 14 -- -- 18,587
Accounting and
transfer agent fees.. 7,752 7,752 7,752 7,752 11,858
Legal and audit fees.. -- 2,744 836 -- 7,005
Registration and
filing fees.......... -- 1,701 -- -- 1,828
Trustees' fees........ -- 510 820 729 2,289
Printing fees......... 1,156 3,986 7,512 8,040 6,035
Other................. 73 1,344 1,130 137 180
---------- ----------- ----------- ----------- -----------
Total Liabilities....... 19,107 29,228 23,275 157,806 100,919
---------- ----------- ----------- ----------- -----------
NET ASSETS:
Capital................. 3,408,633 10,040,326 21,319,561 21,581,016 15,789,725
Undistributed net
investment income
(loss)................. -- 690,306 (88,832) (135,371) (24,225)
Net unrealized
appreciation from
investments and
translation of assets
and liabilities in
foreign currencies..... -- 41,282 3,793,509 6,381,134 4,994,865
Accumulated
undistributed net
realized gain (loss)
from investment and
foreign currency
transactions........... 32 (251,610) 2,875,547 (693,135) (458,312)
---------- ----------- ----------- ----------- -----------
Net Assets.............. $3,408,665 $10,520,304 $27,899,785 $27,133,644 $20,302,053
========== =========== =========== =========== ===========
Outstanding units of
beneficial interest
(shares)............... 3,408,633 995,357 1,856,232 1,554,037 1,502,932
========== =========== =========== =========== ===========
Net asset value--
redemption price per
share.................. $ 1.00 $ 10.57 $ 15.03 $ 17.46 $ 13.51
========== =========== =========== =========== ===========
</TABLE>
See notes to financial statements.
9
<PAGE>
================================================================================
Statements of Operations
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund For the Six Month Period Ended June 30, 1997
(Unaudited)
<TABLE>
<CAPTION>
MID SMALL INTERNATIONAL
PRIME OBLIGATIONS BOND CAPITALIZATION CAPITALIZATION DISCOVERY
FUND FUND FUND FUND FUND
----------------- -------- -------------- -------------- -------------
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest income......... $86,359 $333,385 $ -- $ -- $ --
Dividend income......... 8,251 959 99,365 40,956 167,395
Foreign tax withholding. -- -- (325) -- (11,134)
------- -------- ---------- --------- ----------
Total Income.......... 94,610 334,344 99,040 40,956 156,261
------- -------- ---------- --------- ----------
EXPENSES:
Investment advisory
fees................... 6,902 37,160 124,466 114,758 112,414
Administration fees..... 3,451 10,043 24,894 22,952 17,986
Custodian and accounting
fees................... 4,824 6,442 7,672 7,835 19,298
Legal and audit fees.... 7,785 3,913 13,140 13,760 9,150
Organization costs...... 683 1,019 1,635 1,634 1,437
Registration and filing
fees................... 64 90 308 629 171
Trustees' fees and
expenses............... 1,959 1,117 2,897 2,815 1,332
Transfer agent fees..... 6,930 6,930 6,930 6,930 6,930
Printing costs.......... 1,422 1,632 5,849 4,878 3,293
Other................... 52 60 81 136 441
------- -------- ---------- --------- ----------
Total Expenses........ 34,072 68,406 187,872 176,327 172,452
------- -------- ---------- --------- ----------
Net Investment Income
(loss)................. 60,538 265,938 (88,832) (135,371) (16,191)
------- -------- ---------- --------- ----------
REALIZED/UNREALIZED GAIN
(LOSS) FROM INVESTMENTS:
Net realized gain (loss)
from investment
transactions and
foreign currency
transactions........... 32 (35,802) (1,132,697) (839,302) (99,419)
Net change in unrealized
appreciation
(depreciation) from
investments and
translation of assets
and liabilites in
foreign currencies..... -- 2,609 2,088,255 359,933 2,071,039
------- -------- ---------- --------- ----------
Net realized/unrealized
gain (loss) from
investments............ 32 (33,193) 955,558 (479,369) 1,971,620
------- -------- ---------- --------- ----------
Change in net assets
resulting from
operations............. $60,570 $232,745 $ 866,726 $(614,740) $1,955,429
======= ======== ========== ========= ==========
</TABLE>
See notes to financial statements.
10
<PAGE>
================================================================================
Statements of Changes in Net Assets
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund
<TABLE>
<CAPTION>
PRIME OBLIGATIONS FUND BOND FUND MID CAPITALIZATION FUND
-------------------------- -------------------------- --------------------------
SIX MONTH SIX MONTH SIX MONTH
PERIOD ENDED YEAR ENDED PERIOD ENDED YEAR ENDED PERIOD ENDED YEAR ENDED
JUNE 30, DECEMBER 31, JUNE 30, DECEMBER 31, JUNE 30, DECEMBER 31,
1997 1996 1997 1996 1997 1996
------------ ------------ ------------ ------------ ------------ ------------
FROM INVESTMENT
ACTIVITIES: (UNAUDITED) (UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Net investment income
(loss)................ $ 60,538 $ 183,779 $ 265,938 $ 426,491 $ (88,832) $ (145,500)
Net realized gain
(loss) from investment
transactions.......... 32 -- (35,802) (42,409) (1,132,697) 4,807,708
Net change in
unrealized
appreciation
(depreciation) from
investments........... -- -- 2,609 (172,949) 2,088,255 (1,870,062)
----------- ----------- ----------- ---------- ----------- -----------
Change in net assets re-
sulting from
operations............. 60,570 183,779 232,745 211,133 866,726 2,792,146
----------- ----------- ----------- ---------- ----------- -----------
DISTRIBUTIONS TO
SHAREHOLDERS:
From net investment
income................ (60,538) (183,779) -- (284,420) -- --
----------- ----------- ----------- ---------- ----------- -----------
Change in net assets
from shareholder
distributions.......... (60,538) (183,779) -- (284,420) -- --
----------- ----------- ----------- ---------- ----------- -----------
CAPITAL TRANSACTIONS:
Proceeds from shares
issued................ 1,369,281 5,468,338 1,234,903 3,655,094 4,738,211 8,192,553
Dividends reinvested... 65,309 189,429 -- 284,420 -- --
Cost of shares
redeemed.............. (1,605,160) (5,023,478) (701,774) (870,038) (1,745,740) (1,921,241)
----------- ----------- ----------- ---------- ----------- -----------
Change in net assets
from shares
transactions........... (170,570) 634,289 533,129 3,069,476 2,992,471 6,271,312
----------- ----------- ----------- ---------- ----------- -----------
Change in net assets.... (170,538) 634,289 765,874 2,996,189 3,859,197 9,063,458
NET ASSETS:
Beginning of period.... 3,579,203 2,944,914 9,754,430 6,758,241 24,040,588 14,977,130
----------- ----------- ----------- ---------- ----------- -----------
End of period.......... $ 3,408,665 $ 3,579,203 $10,520,304 $9,754,430 $27,899,785 $24,040,588
=========== =========== =========== ========== =========== ===========
</TABLE>
See notes to financial statements.
11
<PAGE>
================================================================================
Statements of Changes in Net Assets, continued
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund
<TABLE>
<CAPTION>
SMALL INTERNATIONAL
CAPITALIZATION FUND DISCOVERY FUND
-------------------------- --------------------------
SIX MONTH SIX MONTH
PERIOD ENDED YEAR ENDED PERIOD ENDED YEAR ENDED
JUNE 30, DECEMBER 31, JUNE 30, DECEMBER 31,
1997 1996 1997 1996
------------ ------------ ------------ ------------
FROM INVESTMENT ACTIVITIES: (UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment
income(loss)............ $ (135,371) $ (201,060) $ (16,191) $ (48,967)
Net realized gain (loss)
from investment
transactions and foreign
currency transactions... (839,302) 2,859,204 (99,419) 328,532
Net change in unrealized
appreciation
(depreciation) from
investments and
traslation of assets and
liabilities in foreign
currencies.............. 359,933 1,792,987 2,071,039 1,720,693
----------- ----------- ----------- -----------
Change in net assets
resulting from
operations............... (614,740) 4,451,131 1,955,429 2,000,258
----------- ----------- ----------- -----------
DISTRIBUTIONS TO
SHAREHOLDERS:
In excess of net
investment income....... -- -- -- (52,625)
From net realized gains
from investment
transactions............ -- (2,544,355) -- --
----------- ----------- ----------- -----------
Change in net assets from
shareholder
distributions............ -- (2,544,355) -- (52,625)
----------- ----------- ----------- -----------
CAPITAL TRANSACTIONS:
Proceeds from shares
issued.................. 4,842,403 8,508,014 2,904,249 4,585,372
Dividends reinvested..... -- 2,544,355 -- 52,625
Cost of shares redeemed.. (1,589,243) (1,736,482) (1,558,372) (1,230,083)
----------- ----------- ----------- -----------
Change in net assets from
shares transactions...... 3,253,160 9,315,887 1,345,877 3,407,914
----------- ----------- ----------- -----------
Change in net assets...... 2,638,420 11,222,663 3,301,306 5,355,547
----------- ----------- ----------- -----------
NET ASSETS:
Beginning of period...... 24,495,224 13,272,561 17,000,747 11,645,200
----------- ----------- ----------- -----------
End of period............ $27,133,644 $24,495,224 $20,302,053 $17,000,747
=========== =========== =========== ===========
</TABLE>
See notes to financial statements.
12
<PAGE>
Schedule of Portfolio Investments
- --------------------------------------------------------------------------------
THE PARKSTONE ADVANTAGE FUND JUNE 30, 1997
Prime Obligations Fund (UNAUDITED)
<TABLE>
<CAPTION>
Principal Security Amortized
Amount Description Cost
- ------------ ----------------------------------------------- --------------
<S> <C> <C>
Commercial Paper (52.4%):
Electric Utility (2.9%):
100,000 Electricite De France, 5.37%, 7/22/97.......... $ 99,687
--------------
Financial & Brokerage (2.9%):
100,000 Merrill Lynch, 5.67%, 11/4/97.................. 98,016
--------------
Financial & Insurance (17.5%):
100,000 General Electric Capital Corp., 5.57%, 7/9/97.. 99,876
100,000 Great Western Life, 5.64%, 7/21/97............. 99,687
100,000 International Lease, 5.65%, 8/6/97............. 99,435
100,000 SAFECO Credit, 5.60%, 8/4/97................... 99,471
100,000 Texas Agricultural Finance, 5.65%, 9/10/97..... 98,886
100,000 Toshiba Finance, 5.72%, 8/8/97................. 99,396
-------------
596,751
-------------
Foreign Banking & Financial Services (14.6%):
100,000 ABN Amro, 5.36%, 7/21/97....................... 99,702
100,000 Australian Wheat Board, 5.60%, 7/29/97......... 99,565
100,000 Eksportfinans, 5.38%, 7/7/97................... 99,910
100,000 Nordbanken, 5.67%, 10/1/97..................... 98,551
100,000 Svenska Handlesbanken, 5.40%, 7/23/97.......... 99,670
-------------
497,398
-------------
Governments (Foreign) (8.7%):
100,000 Cades, 5.45%, 10/3/97.......................... 98,590
100,000 Province Of British Columbia, 5.43%, 9/4/97.... 99,020
100,000 Province Of Quebec, 5.72%, 10/15/97............ 98,336
-------------
295,946
-------------
Trading (5.8%):
100,000 Goldman Sachs, 5.62%, 10/7/97.................. 98,470
100,000 Mitsui & Co., 5.75%, 8/12/97................... 99,329
-------------
197,799
-------------
Total Commercial Paper 1,785,597
-------------
Investment Companies (9.0%):
154,359 Federated Prime Money Market................... 154,359
153,725 Provident Fund Money Market.................... 153,725
-------------
Total Investment Companies 308,084
-------------
Repurchase Agreements (38.9%):
662,000 Goldman Sachs, 6.14%, 7/1/97, dated 6/30/97
(Collateralized by $705,810 Federal Home
Loan Mortgage Corp., 6.55%, 8/15/22, market
value--$671,705)............................ 662,000
662,000 Nomura Securities, 6.10%, 7/1/97, dated
6/30/97 (Collateralized by $690,000 Federal
Home Loan Mortgage Corp., 5.875%, 12/13/00,
market value--$676,433)..................... 662,000
-------------
Total Repurchase Agreements 1,324,000
-------------
Total Investments (100.3%) (Cost--$3,417,681)(a) $ 3,417,681
=============
</TABLE>
- --------------
Percentages indicated are based on net assets of $3,408,665.
(a) Cost for federal income tax and financial reporting purposes are the same.
See notes to financial statements.
----
13
----
<PAGE>
Schedule of Portfolio Investments
- --------------------------------------------------------------------------------
THE PARKSTONE ADVANTAGE FUND JUNE 30, 1997
Bond Fund (UNAUDITED)
<TABLE>
<CAPTION>
Shares or
Principal Security Market
Amount Description Value
---------- ---------------------------------------------- -------------
<S> <C> <C>
Asset Backed Bonds (12.5%):
Credit Cards (1.4%):
150,000 Sears Credit Account Master Trust, 6.50%,
10/15/03................................... $ 152,115
--------------
Financial Services (11.1%):
300,000 Banc One Auto Grantor Trust, 6.27%, 11/20/03.. 299,862
315,000 Discover Card Master Trust, 6.05%, 8/18/08.... 296,957
325,000 Fleet Capital Trust II, 7.92%, 12/11/26....... 322,156
100,000 Greentree Financial Corp., 6.90%, 4/15/19..... 100,937
53,349 Greentree Financial Corp., 5.90%, 1/15/21..... 53,443
92,514 Structured Asset Securities Co., 7.50%,
8/25/26.................................... 92,514
--------------
1,165,869
--------------
Total Asset Backed Bonds 1,317,984
--------------
Collateralized Mortgage Obligations (1.2%):
130,509 Lehman FHA - Title I Loan Trust, 6.78%,
3/25/08.................................... 130,825
--------------
Total Collateralized Mortgage Obligations 130,825
--------------
Corporate Bonds (36.8%):
Automotive Finance (5.0%):
250,000 Ford Motor Credit, 7.50%, 6/15/04............. 257,813
275,000 General Motors Acceptance Corp., 5.70%, 2/9/99 272,250
--------------
530,063
--------------
Banking (3.1%):
325,000 Swiss Bank Corp., 7.38%, 6/15/17.............. 322,563
--------------
Consumer Goods And Services (1.9%):
200,000 Nike, Inc., 6.38%, 12/1/03.................... 194,750
--------------
Finance (2.1%):
225,000 Associates Corp., 6.75%, 7/15/01.............. 225,000
--------------
Financial Services (13.5%):
285,000 Chase Capital II, 6.36%, 2/1/27............... 277,878
250,000 Cit Group Holdings, 6.25%, 3/22/99............ 250,000
125,000 General Electric Capital Corp., 7.62%, 5/8/00. 128,594
190,000 John Deere Capital, 6.00%, 2/1/99............. 189,288
275,000 Salomon, Inc., 7.20%, 2/1/04.................. 275,000
300,000 USF & G Capital II, 8.47%, 1/10/27............ 303,000
--------------
1,423,760
--------------
Governments(Foreign) (5.0%):
240,000 Province Of Ontario, 7.38%, 1/27/03........... 246,600
250,000 Quebec Province, 13.00%, 10/1/13.............. 279,688
--------------
526,288
--------------
Healthcare (2.4%):
250,000 Allegiance Corp., 7.00%, 10/15/26............. 250,313
--------------
Industrial Goods And Services (2.4%):
250,000 Honeywell, Inc., 6.75%, 3/15/02............... 249,375
--------------
Transportation & Shipping (1.4%):
150,000 Norfolk Southern Corp., 6.95%, 5/1/02......... 150,750
--------------
Total Corporate Bonds 3,872,862
--------------
U.S. Government Agencies (21.1%):
Federal National Mortgage Assoc.
325,000 7.55%, 3/27/07 .............................. 328,773
300,000 8.00%, 2/25/21 .............................. 309,797
163,526 8.00%, 11/1/23 , Pool #190251................. 167,767
Government National Mortgage Assoc.
228,582 6.50%, 9/15/23 .............................. 219,562
385,154 7.00%, 12/15/23 , Pool #780406................ 379,996
806,781 7.50%, 8/15/25 , Pool # 780213................ 812,241
--------------
Total U.S. Government Agencies 2,218,136
--------------
U.S. Treasury Notes (23.3%):
250,000 5.63%, 1/31/98................................ 249,978
90,000 5.13%, 2/28/98................................ 89,664
200,000 6.38%, 4/30/99................................ 200,980
150,000 5.63%, 11/30/00............................... 146,880
1,015,000 6.50%, 8/31/01................................ 1,019,374
350,000 6.63%, 5/15/07................................ 352,636
405,000 6.50%, 11/15/26............................... 387,851
--------------
Total U.S. Treasury Notes 2,447,363
--------------
Investment Companies (4.0%):
266,387 Federated Prime Money Market.................. 266,387
150,000 Provident Fund Money Market................... 150,000
--------------
Total Investment Companies 416,387
--------------
Total Investments (98.9%) (Cost--$10,362,275)(a) $ 10,403,557
==============
</TABLE>
- ------------------
Percentages indicated are based on net assets of $10,520,304.
(a) Represents cost for federal income tax purposes and differs from value by
net unrealized appreciation of securitites as follows:
<TABLE>
<S> <C>
Unrealized appreciation ............................ $ 78,317
Unrealized depreciation ............................ (37,035)
-----------
Net unrealized appreciation ....................... $ 41,282
===========
</TABLE>
See notes to financial statements.
- ----
14
- ----
<PAGE>
Schedule of Portfolio Investments
- --------------------------------------------------------------------------------
THE PARKSTONE ADVANTAGE FUND JUNE 30, 1997
Mid Capitalization Fund (UNAUDITED)
<TABLE>
<CAPTION>
Security Market
Shares Description Value
- ------------ ---------------------------------------------- ---------------
<S> <C> <C>
Common Stocks (92.6%):
Banking & Financial Services (7.8%):
4,200 ContiFinancial Corp.(b)....................... $ 153,300
10,000 Credit Acceptance Corp.(b).................... 128,750
5,500 Finova Group, Inc............................. 420,750
9,900 FIRSTPLUS Financial Group(b).................. 336,600
13,500 Green Tree Financial Corp..................... 480,938
9,100 Nationwide Financial Services................. 241,719
14,600 The Money Store Inc........................... 418,838
--------------
2,180,895
--------------
Building Products (1.0%):
10,400 Royal Plastics Group(b)....................... 275,600
--------------
Business Services (5.4%):
5,300 Cintas Corp................................... 364,375
20,350 Concord EFS, Inc.(b).......................... 526,556
16,387 Paychex....................................... 622,706
--------------
1,513,637
--------------
Commercial Goods & Services (2.2%):
4,400 Apollo Group Inc.(b).......................... 155,100
10,100 SunGard Data Systems Inc.(b).................. 469,650
--------------
624,750
--------------
Computer Software and Peripherals (17.5%):
7,900 Baan Co. Nv(b)................................ 544,113
10,700 BMC Software, Inc.(b)......................... 592,513
9,600 Cadence Design Systems, Inc.(b)............... 321,600
10,900 Cambridge Technology Partners Inc.(b)......... 348,800
5,800 CBT Group PLC(b).............................. 366,125
6,400 Computer Science Corp.(b)..................... 461,600
15,300 Fore Systems Inc.(b).......................... 208,463
12,375 McAfee Associates, Inc.(b).................... 781,172
9,600 Parametric Technology Corp.(b)................ 408,600
14,600 Peoplesoft Inc.(b)............................ 770,150
1,600 Veritas Software Corp.(b)..................... 80,400
--------------
4,883,536
--------------
Correctional Facilities (1.8%):
12,600 Corrections Corp. of America(b)............... 500,850
--------------
Data Processing & Reproduction (2.0%):
12,600 Fiserv, Inc.(b)............................... 562,275
--------------
Educational Services (0.7%):
5,500 Sylvan Learning Systems, Inc.(b).............. 187,000
--------------
Electrical & Electronic (2.4%):
10,833 Analog Devices, Inc.(b)....................... 287,752
10,750 Molex Inc..................................... 374,906
--------------
662,658
--------------
Entertainment (3.2%):
14,150 Carnival Cruise Lines......................... 583,688
8,000 Hollywood Entertainment Corp.(b).............. 183,000
4,200 Regal Cinemas, Inc.(b)........................ 138,600
--------------
905,288
--------------
Environmental Services (1.3%):
9,000 United Waste Systems, Inc.(b)................. 369,000
--------------
Food & Household Products (0.8%):
5,800 Sunbeam Corp.(b).............................. 218,950
--------------
Food Wholesaling (1.6%):
17,000 Richfood Holdings, Inc........................ 442,000
--------------
Funeral Services (4.3%):
26,800 Service Corp. International................... 881,049
7,750 Stewart Enterprises........................... 325,500
--------------
1,206,549
--------------
Health & Personal Care (0.7%):
7,900 Alberto-Culver Co............................. 184,169
--------------
Health Care Services (5.4%):
18,550 Health Management Associates Inc.(b).......... 528,675
39,800 HEALTHSOUTH Corp.(b).......................... 992,512
--------------
1,521,187
--------------
Hotels & Lodging (4.4%):
15,000 Hospitality Franchise Systems(b).............. 869,999
9,300 Sun International Hotel(b).................... 343,519
--------------
1,213,518
--------------
Industrial Goods & Equipment (1.4%):
9,500 MSC Industrial Direct Co., Inc.(b)............ 381,188
--------------
Insurance (3.7%):
9,100 HCC Insurance Holdings Inc.................... 242,856
16,200 Sunamerica Inc................................ 789,749
--------------
1,032,605
--------------
Manufacturing-Consumer Goods (1.8%):
12,700 Newell Co..................................... 503,238
--------------
Medical Equipment & Supplies (4.5%):
1,900 Guidant Corp.................................. 161,500
23,000 Omnicare, Inc................................. 721,625
10,650 Phycor, Inc.(b)............................... 366,759
--------------
1,249,884
--------------
Office Equipment & Services (1.2%):
11,300 U.S. Office Products Co.(b)................... 345,356
--------------
Pharmaceuticals (3.0%):
6,200 Biogen, Inc.(b)............................... 210,025
9,200 Dura Pharmaceuticals, Inc.(b)................. 366,850
3,700 Quintiles Transnational Corp.(b).............. 257,613
--------------
834,488
--------------
Radio/TV (2.3%):
4,100 Clear Channel Communications, Inc.(b)......... 252,406
8,500 Evergreen Media Corp.(b)...................... 379,313
--------------
631,719
--------------
Retail Stores (3.7%):
2,500 CDW Computer Center Inc.(b)................... 132,656
12,031 Consolidated Stores(b)........................ $ 418,086
</TABLE>
Continued
15
<PAGE>
Schedule of Portfolio Investments, continued
- --------------------------------------------------------------------------------
THE PARKSTONE ADVANTAGE FUND JUNE 30, 1997
Mid Capitalization Fund (UNAUDITED)
<TABLE>
<CAPTION>
Security Market
Shares Description Value
- ------------ ---------------------------------------------- ---------------
<S> <C> <C>
Common Stocks, continued:
Retail Stores, continued:
4,500 Dollar General................................ $ 168,750
4,000 Nine West Group, Inc.......................... 152,750
6,700 Saks Holdings Inc.(b)......................... 167,500
--------------
1,039,742
--------------
Technology (0.5%):
2,400 Sanmina Corp.(b).............................. 152,400
--------------
Telecommunications (1.4%):
26,100 CanWest Global Communications Corp............ 386,606
--------------
Telecommunications-Services And Equipment (4.0%):
3,500 Cascade Communications(b)..................... 96,688
5,900 Pairgain Technologies Inc.(b)................. 91,450
12,000 Tellabs, Inc.(b).............................. 670,500
17,500 West TeleServices Corp.(b).................... 258,125
--------------
1,116,763
--------------
Wholesale Distribution - Pharmaceuticals (2.6%):
12,450 Cardinal Health, Inc.......................... 712,763
--------------
Total Common Stocks 25,838,614
--------------
Investment Companies (7.2%):
1,134,816 Federated Prime Money Market.................. 1,134,815
864,000 Provident Fund Money Market................... 863,999
--------------
Total Investment Companies 1,998,814
--------------
Total Investments (99.8%) (Cost--$24,043,919)(a) $ 27,837,428
==============
</TABLE>
- ------------------
Percentages indicated are based on net assets of $27,899,785.
(a) Represents cost for federal income tax purposes and differs from value by
net unrealized appreciation of securitites as follows:
<TABLE>
<S> <C>
Unrealized appreciation ........................ $ 4,912,881
Unrealized depreciation ........................ (1,119,372)
-------------
Net unrealized appreciation ................... $ 3,793,509
=============
</TABLE>
(b) Represents non-income producing securities.
See notes to financial statements.
- ----
16
- ----
<PAGE>
Schedule of Portfolio Investments
- --------------------------------------------------------------------------------
THE PARKSTONE ADVANTAGE FUND JUNE 30, 1997
Small Capitalization Fund (UNAUDITED)
<TABLE>
<CAPTION>
Security Market
Shares Description Value
- ------------ ----------------------------------------------- --------------
<S> <C> <C>
Common Stocks (95.9%):
Advertising (1.3%):
14,387 Ha-Lo Industries Inc.(b)....................... $ 339,893
--------------
Automotive Parts & Equipment (1.5%):
25,500 Miller Industries, Inc.(b)..................... 408,000
--------------
Business Services (8.0%):
29,275 Concord EFS, Inc.(b)........................... 757,490
7,900 Intelliquest Information Group, Inc.(b)........ 177,750
8,200 International Telecommunications Data
Systems, Inc.(b)............................ 200,900
9,900 Iron Mountain, Inc.(b)......................... 297,000
7,400 Medquist Inc.(b)............................... 224,775
5,200 NCO Group, Inc.(b)............................. 152,750
15,650 Payment Services, Inc.(b)...................... 238,663
5,700 Staff Leasing, Inc.(b)......................... 106,875
--------------
2,156,203
--------------
Computer Services (0.8%):
14,600 Larscom, Inc.--Class A(b)...................... 156,950
900 Ontrack Data International(b).................. 20,700
2,700 RWD Technologies(b)............................ 46,575
--------------
224,225
--------------
Computer Software and Peripherals (14.3%):
7,700 Apex PC Solutions, Inc.(b)..................... 152,075
11,600 Aspen Technologies, Inc.(b).................... 436,450
19,050 Cambridge Technology Partners Inc.(b).......... 609,600
8,300 Discreet Logic, Inc.(b)........................ 136,950
8,800 INSO Corp.(b).................................. 180,950
11,500 JDA Software Group, Inc.(b).................... 392,438
5,600 Nova Corp (Georgia)(b)......................... 145,250
5,500 Scopus Technology, Inc.(b)..................... 123,063
20,800 Systemsoft Corp.(b)............................ 223,600
9,100 Veritas Software Corp.(b)...................... 457,275
7,800 VIASOFT, Inc.(b)............................... 395,850
9,000 Visio Corp.(b)................................. 634,500
--------------
3,888,001
--------------
Consumer Goods & Services (2.2%):
9,000 First Alliance Corp.(b)........................ 263,250
7,400 Registry Inc.(b)............................... 340,400
--------------
603,650
--------------
Correctional Facilities (1.6%):
14,900 Wackenhut Corrections Corp.(b)................. 433,963
--------------
Data Processing & Reproduction (2.5%):
10,200 Deltek Systems, Inc.(b)........................ 173,400
6,600 F.Y.I. Inc.(b)................................. 158,400
10,700 Pegasystems, Inc.(b)........................... 335,713
--------------
667,513
--------------
Electrical & Electronic (1.6%):
6,000 ACT Manufacturing, Inc.(b)..................... 250,500
7,200 Advanced Lighting Technologies, Inc.(b)........ 181,800
--------------
432,300
--------------
Entertainment (3.2%):
19,962 Regal Cinemas, Inc.(b)......................... 658,745
13,800 Vistana Inc.(b)................................ 213,900
--------------
872,645
--------------
Financial Services (5.5%):
7,300 Central Financial Acceptance Corp.(b).......... 81,213
26,650 Credit Acceptance Corp.(b)..................... 343,119
30,714 Imperial Credit Industries, Inc.(b)............ 631,557
8,500 Metris Cos. Inc................................ 278,906
4,800 Sirrom Capital Corp............................ 165,600
--------------
1,500,395
--------------
Food Products & Services (0.7%):
5,800 Fine Host Corp.(b)............................. 182,700
--------------
Funeral Services (1.0%):
11,600 Equity Corp. International(b).................. 280,575
--------------
Health Care--Services (7.9%):
8,100 American Oncology Resources, Inc.(b)........... 136,688
4,300 Envoy Corp.(b)................................. 142,975
12,500 NCS Healthcare, Inc.-Class A(b)................ 379,688
11,800 Occusystems Inc.(b)............................ 342,200
35,800 Orthodontic Centers Of America, Inc.(b)........ 651,112
12,150 Total Renal Care Holdings, Inc.(b)............. 488,278
--------------
2,140,941
--------------
Hotels & Resorts (1.5%):
12,100 Signature Resorts, Inc.(b)..................... 418,206
--------------
Insurance (1.7%):
12,400 Amerin Corp.(b)................................ 300,700
7,700 Healthcare Recoveries Inc.(b).................. 149,188
--------------
449,888
--------------
Machinery & Equipment (1.0%):
9,800 Rental Service Corp.(b)........................ 257,250
--------------
Medical Equipment & Supplies (11.1%):
10,250 Esc Medical Systems(b)......................... 261,375
14,100 Henry Schein, Inc.(b).......................... 440,625
9,100 Molecular Devices Corp.(b)..................... 159,250
26,400 Omnicare, Inc.................................. 828,299
15,875 Phycor, Inc.(b)................................ 546,695
5,500 Sabratek Corp.(b).............................. 154,000
14,150 Serologicals Corp.(b).......................... 325,450
5,200 Spine-Tech Inc.(b)............................. 193,050
18,100 UroHealth Systems, Inc.(b)..................... 108,317
--------------
3,017,061
--------------
Pharmaceuticals (8.5%):
8,400 American Medserve Corp.(b)..................... 109,200
22,200 Dura Pharmaceuticals, Inc.(b).................. 885,224
10,175 Jones Medical Industries, Inc.................. 483,313
14,500 Parexel International Corp.(b)................. 460,375
5,400 Quintiles Transnational Corp.(b)............... 375,975
--------------
$ 2,314,087
--------------
</TABLE>
Continued
17
<PAGE>
Schedule of Portfolio Investments, continued
- --------------------------------------------------------------------------------
THE PARKSTONE ADVANTAGE FUND JUNE 30, 1997
Small Capitalization Fund (UNAUDITED)
<TABLE>
<CAPTION>
Security Market
Shares Description Value
- ------------ ---------------------------------------------- -----------
<S> <C> <C>
Common Stocks, continued:
Restaurants (1.4%):
16,850 Landry's Seafood Restaurants(b)............... $ 387,550
-----------
Retail Stores (9.2%):
7,550 CDW Computer Center Inc.(b)................... 400,622
14,125 Just For Feet, Inc.(b)........................ 246,305
13,275 Petco Animal Supplies, Inc.(b)................ 398,250
12,400 Renter's Choice, Inc.(b)...................... 246,450
11,750 Rexall Sundown Inc.(b)........................ 458,250
12,750 The Men's Warehouse, Inc.(b).................. 401,625
13,800 West Marine Inc.(b)........................... 355,350
-----------
2,506,852
-----------
Technology (3.4%):
14,300 Sanmina Corp.(b).............................. 908,049
-----------
Telecommunications (2.9%):
10,300 Harmonic Lightwaves, Inc.(b).................. 176,388
7,400 Pacific Gateway Exchange, Inc.(b)............. 209,050
12,700 Telco Communications Group, Inc.(b)........... 412,750
-----------
798,188
-----------
Wholesale Distribution (3.1%):
8,000 Barnett, Inc.(b).............................. 196,000
19,400 Brightpoint, Inc.(b).......................... 631,713
-----------
827,713
-----------
Total Common Stocks 26,015,848
-----------
Investment Companies (4.4%):
876,933 Federated Prime Money Market.................. 876,932
312,000 Provident Fund Money Market................... 312,000
-----------
Total Investment Companies 1,188,932
-----------
Total Investments (100.3%) (Cost--$20,823,646)(a) $27,204,780
===========
</TABLE>
- ------------------
Percentages indicated are based on net assets of $27,133,644.
(a) Represents cost for federal income tax purposes and differs from value by
net unrealized appreciation of securitites as follows:
<TABLE>
<S> <C>
Unrealized appreciation ..................... $ 7,381,370
Unrealized depreciation ..................... (1,000,236)
-----------
Net unrealized appreciation ................. $ 6,381,134
===========
</TABLE>
(b) Represents non-income producing securities.
See notes to financial statements.
- ----
18
- ----
<PAGE>
Schedule of Portfolio Investments
- --------------------------------------------------------------------------------
THE PARKSTONE ADVANTAGE FUND JUNE 30, 1997
International Discovery Fund (UNAUDITED)
<TABLE>
<CAPTION>
Security Market
Shares Description Value
- ------------ ---------------------------------------------- --------------
<S> <C> <C>
Common Stocks (90.7%):
Australia (3.1%):
25,000 CSL Ltd....................................... $ 152,076
53,000 Foster's Brewing Group Ltd.................... 97,674
20,000 Leighton Holdings............................. 96,655
20,291 QBE Insurance Group Ltd....................... 121,607
16,933 Smith (Howard) Ltd............................ 159,834
--------------
Total Australia 627,846
--------------
Austria (0.5%):
550 VA Technologie AG............................. 100,672
--------------
Belgium (1.4%):
600 COLRUYT SA.................................... 292,907
--------------
Brazil (0.5%):
6,500 Companhia Cervejaria Brahma................... 99,531
--------------
Canada (2.5%):
12,500 Bombardier, Inc., Class B..................... 283,605
12,000 CAE Inc....................................... 95,683
5,000 Canadian Natural Resources Ltd................ 129,933
--------------
Total Canada 509,221
--------------
Denmark (1.2%):
4,000 Danisco A/S................................... 244,921
--------------
Finland (0.3%):
1,700 Huhtamaki Group............................... 73,148
--------------
France (6.1%):
520 Altran Technologies SA........................ 170,058
1,100 Clarins....................................... 146,518
3,000 Hermes International.......................... 281,045
3,500 Sidel SA...................................... 271,251
2,220 Societe BIC SA................................ 363,387
--------------
Total France 1,232,259
--------------
Germany (7.3%):
3,000 Adidas AG..................................... 335,718
1,200 Fresenius AG.................................. 272,706
725 Mannesmann AG................................. 324,111
4,700 Merck KGaA.................................... 204,989
3,200 Schering AG................................... 343,041
--------------
Total Germany 1,480,565
--------------
Hong Kong (2.1%):
11,000 Henderson Land Development Co. Ltd............ 97,615
100,700 Hong Kong & China Gas Co. Ltd................. 201,471
10,500 Sun Hung Kai Properties Ltd................... 126,383
--------------
Total Hong Kong 425,469
--------------
Indonesia (0.7%):
142,697 PT Bank International Indonesia............... 123,242
4,000 PT Hanjaya Mandala Sampoema(b)................ 15,258
--------------
Total Indonesia 138,500
--------------
Italy (1.3%):
32,000 Bulgari SPA................................... 180,923
2,800 Gewiss SPA.................................... 48,134
1,400 Safilo SPA.................................... 32,501
--------------
Total Italy 261,558
--------------
Japan (24.4%):
1,000 Autobacs Seven Co. Ltd........................ 79,350
13,000 Canon, Inc.................................... 354,452
16,000 Daiichi Pharmaceuticals Co.................... 282,443
20,000 Denki Kogyo Co. Ltd........................... 155,728
5,000 Fuji Photo Film Ltd........................... 201,433
5,000 Hirose Electric............................... 343,441
2,000 Hoya Corp..................................... 89,137
2,400 Keyence Corp.................................. 356,550
3,900 Matsumotokiyoshi.............................. 165,638
12,000 Matsushita Electric Works..................... 136,328
15,000 NEC Corp...................................... 209,735
3,000 Nichii Gakkan Co.............................. 167,788
1,300 Nintendo Co. Ltd.............................. 109,062
10,000 Omron Corp.................................... 212,357
16,000 Ricoh Company Ltd............................. 209,735
5,000 Rohm Co....................................... 515,600
9,000 Sankyo Co. Ltd................................ 302,805
18,000 Takasago International........................ 108,538
18,000 Takeda Chemical Industries.................... 506,511
6,000 TDK Corp...................................... 440,968
--------------
Total Japan 4,947,599
--------------
Malaysia (0.9%):
26,000 United Engineers (Malaysia) Ltd............... 187,480
--------------
Mexico (2.6%):
42,000 Formento Economico Mexicano SA de CV, Class B.
249,745
24,000 Grupo Carso SA de CV, Series A1............... 166,849
110,000 Grupo Industrial Maseca SA de CV, Class B..... 120,309
--------------
Total Mexico 536,903
--------------
Netherlands (6.2%):
2,640 Ahrend Groep NV............................... 178,531
13,000 Elsevier NV................................... 217,626
4,600 Hagemeyer NV.................................. 238,062
3,100 Oce-Van Der Grinten NV........................ 400,608
1,776 Wolters Kluwer NV............................. 216,638
--------------
Total Netherlands 1,251,465
--------------
New Zealand (1.1%):
35,000 Fernz Corp. Ltd............................... 118,603
27,837 Fisher & Paykel Industries Ltd................ 108,479
--------------
Total New Zealand $ 227,082
--------------
</TABLE>
Continued
19
<PAGE>
Schedule of Portfolio Investments, continued
- --------------------------------------------------------------------------------
THE PARKSTONE ADVANTAGE FUND JUNE 30, 1997
International Discovery Fund (UNAUDITED)
<TABLE>
<CAPTION>
Security Market
Shares Description Value
- ------------ ---------------------------------------------- --------------
<S> <C> <C>
Common Stocks, continued:
Norway (1.4%):
18,000 Nera ASA...................................... $ 105,726
9,000 Schibsted ASA................................. 178,259
--------------
Total Norway 283,985
--------------
Singapore (0.6%):
50,000 Singapore Technologies Industrial Corp........ 128,685
--------------
South Africa (0.8%):
18,000 Dimension Data Holdings Ltd.(b)............... 71,436
3,000 South African Breweries Ltd................... 92,106
--------------
Total South Africa 163,542
--------------
Spain (2.3%):
3,000 Cortefiel SA.................................. 131,162
19,000 Prosegur, Cia de Seguridad SA, Registered..... 232,542
1,800 Talbacalera SA................................ 96,811
--------------
Total Spain 460,515
--------------
Sweden (1.0%):
7,000 Sandvik AB, Class B........................... 198,710
--------------
Switzerland (3.7%):
200 Nestle SA..................................... 264,225
140 Novartis AG................................... 224,138
30 Roche Holdings AG............................. 271,736
--------------
Total Switzerland 760,099
--------------
United Kingdom (8.9%):
28,000 Compass Group Plc............................. 314,087
8,000 D.F.S. Furniture Co. Plc...................... 74,827
84,000 Halma Plc..................................... 228,575
14,100 Logica Plc.................................... 162,506
74,000 Polypipe Plc.................................. 256,169
33,000 Powerscreen International Plc................. 359,464
12,000 Siebe Plc..................................... 203,311
33,000 TT Group Plc.................................. 203,211
--------------
Total United Kingdom 1,802,150
--------------
United States (9.8%):
9,350 Cia De Telecomunicaciones de Chile SA (ADR)... 308,550
4,000 Newbridge Networks Corp. (ADR)................ 174,000
3,200 Oy Nokia AB, Class A (ADR).................... 236,000
9,000 Portugal Telecom SA (ADR)..................... 361,125
3,000 Telecommunicacoes Brasileiras S/A--Telebras
(ADR)...................................... 455,251
3,600 Teva Pharmaceutical Industries Ltd. (ADR)..... 233,100
7,000 YPF Sociedad Anonima (ADR).................... 215,250
--------------
Total United States 1,983,276
--------------
Total Common Stocks 18,418,088
--------------
Demand Deposit Account (3.5%):
(3.5%):
710,621 Parkstone Bank of California.................. 710,622
--------------
Total Demand Deposit Account 710,622
--------------
Preferred Stock (1.8%):
(1.8%):
1,800 DEM SAP AG.................................... 371,356
--------------
Total Preferred Stock 371,356
--------------
Investment Companies (3.6%):
178,395 Highmark Diversified Obligations Fund......... 178,395
300,000 Highmark US Government Obligations Fund....... 300,000
250,000 Highmark US Treasury Obligations Fund......... 250,000
--------------
Total Investment Companies 728,395
--------------
Total Investments (99.6%) (Cost--$15,232,056)(a) $ 20,228,461
==============
</TABLE>
At June 30, 1997, International Discovery Fund's investment concentration, by
industry, was as follows:
<TABLE>
<S> <C>
Basic Industries 4.3%
Conglomerates 5.0%
Consumer Goods & Services 18.9%
Electrical & Electronics 11.7%
Energy 2.7%
Engineering 5.8%
Financial & Business Services 10.9%
Health Care 13.9%
Retailing 2.5%
Telecommunications 10.0%
Other 14.3%
-----------
Total 100%
===========
</TABLE>
- ------------------
Percentages indicated are based on net assets of $20,302,053.
Continued
20
<PAGE>
Schedule of Portfolio Investments, continued
- --------------------------------------------------------------------------------
THE PARKSTONE ADVANTAGE FUND JUNE 30, 1997
International Discovery Fund (UNAUDITED)
(a) Represents cost for federal income tax purposes differs from value by net
unrealized appreciation of securities as follows:
<TABLE>
<S> <C>
Unrealized appreciation ....................... $ 5,171,294
Unrealized depreciation ....................... (174,889)
-------------
Net unrealized appreciation ................... $ 4,996,405
=============
</TABLE>
(b) Represents non-income producing securities.
ADR (American Depository Receipt)
At June 30, 1997, the Fund's open forward currency contracts were as follows:
<TABLE>
<CAPTION>
Unrealized
Delivery Contract Contract Contract Market Appreciation/
Currency Date Price Amount Value Value (Depreciation)
- -------- ---- ----- ------ ----- ----- --------------
<S> <C> <C> <C> <C> <C> <C>
Long Contracts:
Singapore Dollar ....... 07/02/97 $ 1.43 $ 65,239 $ 45,765 $ 45,625 $ (140)
Short Contracts:
Hong Kong Dollar ....... 07/03/97 7.75 (953,365) (122,983) (123,058) (75)
Japanese Yen ........... 07/01/97 114.70 (21,250) (186) (186) -
-------------------------------------------------
$ (77,404) $ (77,619) $ (215)
=================================================
</TABLE>
See notes to financial statements.
----
21
----
<PAGE>
================================================================================
Notes to Financial Statements
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1997
(Unaudited)
1. ORGANIZATION:
The Parkstone Advantage Fund (the "Company") is registered under the
Investment Company Act of 1940, as amended, as a diversified, open-end
investment company.
The Company is authorized to issue an unlimited number of shares which are
shares of beneficial interest without par value. The Company presently offers
series of shares of the Prime Obligations Fund, Bond Fund, Mid Capitalization
Fund (formerly known as the Equity Fund), Small Capitalization Fund and
International Discovery Fund (collectively, "the Funds" and individually, a
"Fund"). Sales of shares of the Fund may only be made to separate accounts of
various life insurance companies ("Participating Insurance Companies"). As of
June 30, 1997, the only Participating Insurance Company is Security Benefit
Life Insurance Company. First of America Investment Corp. ("FIC"), a wholly-
owned subsidiary of First of America Bank, serves as investment adviser to
the Company.
On April 30, 1997, the Board resolved that the name of the Trust's Equity
Fund portfolio be, and thereby was, changed to the Mid Capitalization Fund.
2. SIGNIFICANT ACCOUNTING POLICIES:
The following is a summary of significant accounting policies followed by the
Company in the preparation of its financial statements. The policies are in
conformity with generally accepted accounting principles. 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.
SECURITIES VALUATION:
Investments of the Prime Obligations Fund are valued at either amortized
cost, which approximates market value, or at original cost, which combined
with accrued interest approximates market value. Under the amortized cost
method, discount or premium is amortized on a constant basis to the
maturity of the security. In addition, the Prime Obligations Fund may not
(a) purchase any investment with a remaining maturity greater than thirteen
months unless such instrument is subject to a demand feature, or (b)
maintain a dollar-weighted average portfolio maturity which exceeds 90
days.
Investments in common and preferred stocks, corporate bonds, commercial
paper and foreign government bonds and U.S. Government securities of the
Bond Fund, Mid Capitalization Fund, Small Capitalization Fund and
International Discovery Fund (collectively, "the variable net asset value
funds"), are valued at their market values determined on the basis of the
mean between the latest available bid and asked prices in the principal
market (closing sales prices if the principal market is an exchange) in
which such securities are normally traded. Amortization of premium or
discount is recognized on the sale or maturity of the security for the Bond
Fund. Investments in foreign securities in the International Discovery Fund
are valued based on quotations from the primary market in which they are
traded. Investments in investment companies are valued at their net asset
values as reported by such investment companies. The differences between
the cost and market values of investments held by the variable net asset
value funds are reflected as either unrealized appreciation or
depreciation.
Continued
22
<PAGE>
================================================================================
Notes to Financial Statements, continued
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1997
(Unaudited)
SECURITIES TRANSACTIONS AND RELATED INCOME:
Securities transactions are accounted for on the date the security is
purchased or sold (trade date). Interest income is recognized on the
accrual basis. Dividend income is recorded on the ex-dividend date. Gains
or losses realized from sales of securities are determined by comparing the
identified cost of the security lot sold with the net sales proceeds.
FOREIGN CURRENCY TRANSLATION:
The market value of investment securities, other assets and liabilities of
the International Discovery Fund denominated in a foreign currency are
translated into U.S. dollars at the current exchange rate. Purchases and
sales of securities, income receipts and expense payments are translated
into U.S. dollars at the exchange rate on the date of each transaction.
Reported net realized foreign exchange gains or losses arise from sales and
maturities of portfolio securities, sales of foreign currencies, currency
exchange fluctuations between the trade and settlement dates of securities
transactions, and the difference between the amounts of assets and
liabilities recorded and the U.S. dollars equivalent of the amounts
actually received or paid. Net unrealized foreign exchange gains and losses
arise from changes in the value of assets and liabilities, including
investments in securities, resulting from changes in currency exchanges
rates.
REPURCHASE AGREEMENTS:
The Funds may acquire repurchase agreements from member banks of the
Federal Deposit Insurance Corporation with capital, surplus and undivided
profits in excess of $100,000,000 (as of the date of their most recently
published financial statements) and from registered broker/dealers which
FIC deems creditworthy under guidelines approved by the Board of Trustees,
subject to the seller's agreement to repurchase the underlying securities
at a mutually agreed-upon date and price. The repurchase price generally
equals the price paid by the Fund plus interest negotiated on the basis of
current short-term rates, which may be more or less than the rate on the
underlying collateral. The seller, under a repurchase agreement, is
required to maintain the value of collateral held pursuant to the agreement
at not less than the repurchase price (including accrued interest).
Securities subject to repurchase agreements are held by the Funds'
custodian or another qualified custodian or in the Federal Reserve/Treasury
book-entry system. Repurchase agreements are considered to be loans by a
Fund under the 1940 Act.
DIVIDENDS TO SHAREHOLDERS:
For the Prime Obligations Fund, dividends of net investment income are
declared daily and paid monthly and distributable net realized capital
gains are declared and distributed at least annually.
Dividends from net investment income and distributable realized capital
gains are declared and paid at least annually for the variable net asset
value funds. The character of distributions made during the year from net
investment income or net realized gains may differ from their ultimate
characterization for federal income tax purposes. These differences are
primarily due to the recharacterization of foreign currency gains and
losses.
Continued
23
<PAGE>
================================================================================
Notes to Financial Statements, continued
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1997
(Unaudited)
FEDERAL INCOME TAXES:
It is the policy of each of the Funds to continue to qualify as a regulated
investment company by complying with the provisions available to certain
investment companies, as defined in applicable sections of the Internal
Revenue Code, and to make distributions of net investment income and net
realized capital gains sufficient to relieve it from all, or substantially
all, federal income taxes.
OTHER:
Expenses that are directly related to one of the Funds are charged directly
to that Fund. Other operating expenses for the Company are prorated to the
Funds on the basis of relative net assets.
3. INVESTMENT RISKS:
The International Discovery Fund's investment in foreign securities may
involve risks not present in domestic investments. Since foreign securities
are denominated in foreign currencies and pay interest or dividends in
foreign currencies, changes in the relationship of these currencies to the
U.S. dollar can significantly affect the value of the investment and
operations of the Fund. Foreign investments may also subject the Fund to
foreign government exchange restrictions, expropriation, taxation or other
political, social or economic developments, all of which could affect the
market and/or credit risk of the investments.
4. PURCHASES AND SALES OF SECURITIES:
Purchases and sales of securities (excluding short-term securities) for the
six month period ended June 30, 1997, are as follows:
<TABLE>
<CAPTION>
PURCHASES SALES
---------- ----------
<S> <C> <C>
Bond Fund.............................................. $9,531,375 $8,276,020
Equity Fund............................................ 7,046,742 4,282,558
Small Capitalization Fund.............................. 8,273,686 4,839,490
International Discovery Fund........................... 4,011,881 2,396,124
</TABLE>
5. CAPITAL SHARE TRANSACTIONS
<TABLE>
<CAPTION>
PRIME
OBLIGATIONS FUND BOND FUND
----------------------- -------------------
AMOUNT SHARES AMOUNT SHARES
----------- ---------- ---------- -------
<S> <C> <C> <C> <C>
Semi annual period ended June
30, 1997:
Shares sold................ $ 1,369,281 1,369,281 $1,234,903 119,124
Dividends reinvested....... 65,309 65,309 -- --
Shares redeemed............ (1,605,160) (1,605,160) (701,774) (67,725)
----------- ---------- ---------- -------
Net increase (decrease).... $ (170,570) (170,570) $ 533,129 51,399
=========== ========== ========== =======
Year ended December 31, 1996:
Shares sold................ $ 5,468,338 5,468,338 $3,655,094 356,077
Dividends reinvested....... 189,429 189,429 284,420 28,528
Shares redeemed............ (5,023,478) (5,023,478) (870,038) (84,465)
----------- ---------- ---------- -------
Net increase (decrease).... $ 634,289 634,289 $3,069,476 300,140
=========== ========== ========== =======
</TABLE>
Continued
24
<PAGE>
================================================================================
Notes to Financial Statements, continued
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1997
(Unaudited)
<TABLE>
<CAPTION>
INTERNATIONAL
MID CAPITALIZATION SMALL CAPITALIZATION DISCOVERY
FUND FUND FUND
--------------------- --------------------- ---------------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
----------- -------- ----------- -------- ----------- --------
<S> <C> <C> <C> <C> <C> <C>
Semi annual period ended
June 30, 1997:
Shares sold........... $ 4,738,211 333,118 $ 4,842,403 310,376 $ 2,904,249 234,083
Dividends reinvested.. -- -- -- -- -- --
Shares redeemed....... (1,745,740) (124,015) (1,589,243) (102,337) (1,558,372) (126,504)
----------- -------- ----------- -------- ----------- --------
Net increase (de-
crease).............. $ 2,992,471 209,103 $ 3,253,160 208,039 $ 1,345,877 107,579
=========== ======== =========== ======== =========== ========
Year ended December 31, 1996:
Shares sold........... $ 8,192,553 579,034 $ 8,508,014 452,500 $ 4,585,372 398,934
Dividends reinvested.. -- -- 2,544,355 140,962 52,625 4,568
Shares redeemed ...... (1,921,241) (136,089) (1,736,482) (92,463) (1,230,083) (107,563)
----------- -------- ----------- -------- ----------- --------
Net increase (de-
crease).............. $ 6,271,312 442,945 $ 9,315,887 500,999 $ 3,407,914 295,939
=========== ======== =========== ======== =========== ========
</TABLE>
6. RELATED PARTY TRANSACTIONS:
Investment advisory services are provided to the Funds by FIC. Gulfstream
Global Investors, Ltd. ("Gulfstream") serves as the sub-adviser for the
International Discovery Fund. Under the terms of the investment advisory
agreement, FIC is entitled to receive fees based on a percentage of the
average daily net assets of the Funds. Under the terms of the sub-investment
advisory agreement, Gulfstream is entitled to receive fees from FIC based on
a percentage of the average daily net assets of the International Discovery
Fund.
BISYS Fund Services Limited Partnership d/b/a BISYS Fund Services ("BISYS")
is an Ohio limited partnership. BISYS Fund Services Ohio, Inc. ("BISYS
Ohio"), and BISYS are subsidiaries of The BISYS Group, Inc.
BISYS, with whom certain officers of the Company are affiliated, serves the
Company as Administrator. Such officers are paid no fees directly by the
Company for serving as officers of the Company. Under the terms of the
Management and Administration Agreement between BISYS and the Company,
BISYS's fees are computed daily as a percentage of the average net assets of
each of the Funds. BISYS also serves as Distributor, Mutual Fund Accountant
and Transfer Agent.
<TABLE>
<CAPTION>
PRIME MID SMALL INTERNATIONAL
OBLIGATIONS BOND CAPITALIZATION CAPITALIZATION DISCOVERY
FUND FUND FUND FUND FUND
----------- ------- -------------- -------------- -------------
<S> <C> <C> <C> <C> <C>
INVESTMENT ADVISORY
FEES:
Annual fee (percentage
of Average net assets). 0.40% 0.74% 1.00% 1.00% Varies(a)
ADMINISTRATION FEES:
Annual fee (percentage
of Average net assets). 0.20% 0.20% 0.20% 0.20% 0.20%
ANNUAL ACCOUNTING &
TRANSFER AGENT FEE(B)... $11,122 $11,889 $11,889 $11,889 $12,649
</TABLE>
-------
(a) For International Discovery Fund, FIC receives 1.25% of the first $50
million of the International Discovery Fund's average daily net assets,
1.20% of the average daily net assets between $50 million and $100
million, 1.15% of average daily net assets between $100 and $400; and
1.05% of all average daily net assets above $400 million.
Continued
25
<PAGE>
================================================================================
Notes to Financial Statements, continued
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1997
(Unaudited)
(b) Transfer Agent receives an annual fee for its transfer agency services
equal to $15,000 per Fund. Fund Accounting receives an annual fee for its
fund accounting services equal to $10,000 per Fund. The Prime Obligations
Fund pays an additional annual fee of 0.016% of its average daily net
assets. Each of the Small Capitalization Fund, Mid Capitalization Fund
and Bond Fund pays an additional annual fee of 0.022% of its average
daily net assets and the International Discovery Fund pays an additional
annual fee of 0.035% of its average daily net assets.
Fees may be voluntarily reduced or reimbursed to assist the Funds in
maintaining competitive expense ratios.
26
<PAGE>
================================================================================
Financial Highlights
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund
<TABLE>
<CAPTION>
PRIME OBLIGATIONS FUND
-------------------------------------------------------------------
FOR A SHARE OUTSTANDING SIX MONTH SEPTEMBER 23
THROUGHOUT PERIOD ENDED YEAR ENDED YEAR ENDED YEAR ENDED 1993 TO
THE PERIOD JUNE 30, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1997 1996 1995 1994 1993 (A)
------------ ------------ ------------ ------------ ------------
(UNAUDITED)
<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.. 0.017 0.044 0.041 0.023 0.009
---------- ---------- ---------- ---------- ----------
Total from Investment
Activities.............. 0.017 0.044 0.041 0.023 0.009
---------- ---------- ---------- ---------- ----------
DISTRIBUTIONS
From net investment
income.................. (0.017) (0.044) (0.041) (0.023) (0.009)
---------- ---------- ---------- ---------- ----------
Total Distributions... (0.017) (0.044) (0.041) (0.023) (0.009)
---------- ---------- ---------- ---------- ----------
NET ASSET VALUE, END OF
PERIOD.................. $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
========== ========== ========== ========== ==========
Total Return............ 1.75% (b) 4.46% 4.19% 2.29% 0.88% (b)
RATIOS / SUPPLEMENTARY
DATA:
Net Assets at end of
period.................. $3,408,665 $3,579,203 $2,944,914 $2,231,991 $2,028,251
Ratio of expenses to
average net assets...... 1.97% (c) 1.01% 1.64% 1.90% 1.79% (c)
Ratio of net investment
income to average net
assets.................. 3.51% (c) 4.34% 4.15% 2.29% 1.53% (c)
</TABLE>
- -------
(a) Period from commencement of operations.
(b) Not Annualized
(c) Annualized
See notes to financial statements.
27
<PAGE>
================================================================================
Financial Highlights
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund
<TABLE>
<CAPTION>
BOND FUND
----------------------------------------------------------------------
FOR A SHARE OUTSTANDING SIX MONTH SEPTEMBER 23,
THROUGHOUT PERIOD ENDED YEAR ENDED YEAR ENDED YEAR ENDED 1993 TO
THE PERIOD JUNE 30, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1997 1996 1995 1994 1993 (A)
------------ ------------ ------------ ------------ -------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD.... $ 10.33 $ 10.50 $ 9.35 $ 9.96 $ 10.00
----------- ---------- ---------- ---------- ----------
Investment Activities
Net investment income
(loss)................. 0.24 0.36 0.40 0.42 0.10
Net realized and
unrealized gains
(losses) from
investments........... -- (0.18) 1.17 (0.96) (0.14)
----------- ---------- ---------- ---------- ----------
Total from Investment
Activities............. 0.24 0.18 1.57 (0.54) (0.04)
----------- ---------- ---------- ---------- ----------
Distributions
From net investment
income................. -- (0.35) (0.42) (0.07) --
----------- ---------- ---------- ---------- ----------
Total Distributions.... -- (0.35) (0.42) (0.07) --
----------- ---------- ---------- ---------- ----------
NET ASSET VALUE, END OF
PERIOD.................. $ 10.57 $ 10.33 $ 10.50 $ 9.35 $ 9.96
=========== ========== ========== ========== ==========
Total Return............ 2.32%(b) 1.83% 16.98% (5.38%) (0.40%)(b)
RATIOS/SUPPLEMENTARY
DATA:
Net Assets at end of
period.................. $10,520,304 $9,754,430 $6,758,241 $4,651,157 $3,216,233
Ratio of expenses to
average net assets...... 1.36%(c) 1.29% 1.57% 1.80% 2.03%(c)
Ratio of net investment
income to average net
assets.................. 5.30%(c) 5.32% 5.31% 5.27% 5.23%(c)
Portfolio Turnover...... 86% 492% 178% 159% 101%
</TABLE>
- -------
(a) Period from commencement of operations.
(b) Not Annualized
(c) Annualized
See notes to financial statements.
28
<PAGE>
================================================================================
Financial Highlights
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund
<TABLE>
<CAPTION>
MID CAPITALIZATION FUND
---------------------------------------------------------------------------
FOR A SHARE OUTSTANDING SIX MONTH SEPTEMBER 23,
THROUGHOUT PERIOD ENDED YEAR ENDED YEAR ENDED YEAR ENDED 1993 TO
THE PERIOD JUNE 30, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1997 1996 1995 1994 1993 (A)
------------ ------------ ------------ ------------ -------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD..... $ 14.60 $ 12.44 $ 9.64 $ 10.17 $ 10.00
----------- ----------- ----------- ---------- ----------
Investment Activities
Net investment income
(loss)................. (0.05) (0.09) (0.08) (0.07) (0.02)
Net realized and
unrealized gains
(losses) from
investments............ 0.48 2.25 2.88 (0.46) 0.19
----------- ----------- ----------- ---------- ----------
Total from Investment
Activities.............. 0.43 2.16 2.80 (0.53) 0.17
----------- ----------- ----------- ---------- ----------
Distributions
From net investment
income.................. -- -- -- -- --
----------- ----------- ----------- ---------- ----------
Total Distributions..... -- -- -- -- --
----------- ----------- ----------- ---------- ----------
NET ASSET VALUE, END OF
PERIOD................... $ 15.03 $ 14.60 $ 12.44 $ 9.64 $ 10.17
=========== =========== =========== ========== ==========
Total Return............. 2.95%(b) 17.36% 29.05% (5.21%) 1.70%(b)
RATIOS/SUPPLEMENTARY
DATA:
Net Assets at end of
period................... $27,899,785 $24,040,588 $14,977,130 $9,095,015 $3,893,346
Ratio of expenses to
average net assets....... 1.51%(c) 1.42% 1.62% 1.86% 2.11%(c)
Ratio of net investment
income to average net
assets................... (0.71%)(c) (0.73%) (0.84%) (0.92%) (1.09%)(c)
Portfolio Turnover....... 19% 127% 44% 51% 45%
Average commission rate
paid(d).................. $ 0.0800
</TABLE>
- -------
(a) Period from commencement of operations.
(b) Not Annualized
(c) Annualized
(d) Represents the total dollar amount of commissions paid on portfolio
security transactions divided by total number of shares purchased and sold
by the Fund for which commissions were charged.
See notes to financial statements.
29
<PAGE>
================================================================================
Financial Highlights
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund
<TABLE>
<CAPTION>
SMALL CAPITALIZATION FUND
---------------------------------------------------------------------------
FOR A SHARE OUTSTANDING SIX MONTH SEPTEMBER 23,
THROUGHOUT THE PERIOD PERIOD ENDED YEAR ENDED YEAR ENDED YEAR ENDED 1993 TO
JUNE 30, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1997 1996 1995 1994 1993 (A)
------------ ------------ ------------ ------------ -------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD... $ 18.20 $ 15.71 $ 11.58 $ 11.00 $ 10.00
----------- ----------- ----------- ---------- ----------
Investment Activities
Net investment income
(loss)................ (0.09) (0.15) (0.15) (0.13) (0.03)
Net realized and
unrealized gains
(losses) from
investments.......... (0.65) 4.79 4.28 0.71 1.03
----------- ----------- ----------- ---------- ----------
Total from Investment
Activities........... (0.74) 4.64 4.13 0.58 1.00
----------- ----------- ----------- ---------- ----------
Distributions
In excess of net
investment income.... -- -- -- -- --
From of net realized
gains................ -- (2.15) -- -- --
----------- ----------- ----------- ---------- ----------
Total Distributions... -- (2.15) -- -- --
----------- ----------- ----------- ---------- ----------
NET ASSET VALUE, END OF
PERIOD................. $ 17.46 $ 18.20 $ 15.71 $ 11.58 $ 11.00
=========== =========== =========== ========== ==========
Total Return........... (4.07%)(b) 29.66% 35.66% 5.27% 10.00%(b)
RATIOS/SUPPLEMENTARY
DATA:
Net Assets at end of
period................. $27,133,644 $24,495,224 $13,272,561 $7,476,444 $3,064,765
Ratio of expenses to
average net assets.... 1.54%(c) 1.40% 1.64% 1.98% 1.87%(c)
Ratio of net investment
income (loss) to
average net assets.... (1.18%)(c) (1.06%) (1.29%) (1.66%) (1.40%)(c)
Ratio of expenses to
average net assets*... 2.23%(c)
Ratio of net investment
income to average net
assets*............... (1.76%)(c)
Portfolio Turnover..... 22% 60% 64% 39% 23%
Average commission rate
paid(d)............... $ 0.0800
</TABLE>
- -------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not Annualized
(c) Annualized
(d) Represents the total dollar amount of commissions paid on portfolio
security transactions divided by total number of shares purchased and sold
by the Fund for which commissions were charged.
See notes to financial statements.
30
<PAGE>
================================================================================
Financial Highlights
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund
<TABLE>
<CAPTION>
INTERNATIONAL DISCOVERY FUND
--------------------------------------------------------------------------
FOR A SHARE SIX MONTH FEBRUARY 1,
OUTSTANDING PERIOD ENDED YEAR ENDED YEAR ENDED YEAR ENDED 1993 TO
THROUGHOUT THE JUNE 30, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
PERIOD 1997 1996 1995 1994 1993 (A)
------------ ------------ ------------ ------------ ------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF
PERIOD............. $ 12.18 $ 10.59 $ 9.65 $ 10.35 $ 10.00
----------- ----------- ----------- ---------- ----------
Investment
Activities
Net investment
income (loss)...... (0.01) (0.04) (0.03) (0.07) (0.03)
Net realized and
unrealized gains
(losses) from
investments....... 1.34 1.67 0.97 (0.63) 0.38
----------- ----------- ----------- ---------- ----------
Total from
Investment
Activities........ 1.33 1.63 0.94 (0.70) 0.35
----------- ----------- ----------- ---------- ----------
Distributions
In excess of net
investment income. -- (0.04) -- -- --
From of net
realized gains.... -- -- -- -- --
----------- ----------- ----------- ---------- ----------
Total
Distributions...... -- (0.04) -- -- --
----------- ----------- ----------- ---------- ----------
NET ASSET VALUE, END
OF PERIOD........... $ 13.51 $ 12.18 $ 10.59 $ 9.65 $ 10.35
=========== =========== =========== ========== ==========
Total Return........ 10.92%(b) 15.41% 9.74% (6.76%) 3.50%(b)
RATIOS/SUPPLEMENTARY
DATA:
Net Assets at end of
period.............. $20,302,053 $17,000,747 $11,645,200 $9,537,019 $6,334,523
Ratio of expenses to
average net assets. 1.92%(c) 2.00% 2.38% 2.34% 2.51%(c)
Ratio of net
investment income
(loss) to average
net assets......... (0.18%)(c) (0.35%) (0.39%) (1.13%) (1.38%)(c)
Portfolio Turnover.. 15% 65% 86% 87% 13%
Average commission
rate paid(d)....... $ 0.0296
</TABLE>
- -------
(a) Period from commencement of operations.
(b) Not Annualized
(c) Annualized
(d) Represents the total dollar amount of commissions paid on portfolio
security transactions divided by total number of shares purchased and sold
by the Fund for which commissions were charged.
See notes to financial statements
31
<PAGE>
The Parkstone Advantage Fund
. Mid Capitalization Fund
. Small Capitalization Fund
. International Discovery Fund
. Bond Fund
. Prime Obligations Fund
Not FDIC Insured
This report is submitted for the general information of the shareholders of the
Funds. The report is not authorized for distribution to prospective investors
in the Funds unless preceded or accompanied by an effective prospectus, which
contains details concerning the sales charges and other pertinent information.
-------------------------------
-------------- Bulk Rate
-------------- U.S. Postage
-------------- PAID
-------------- Columbus, Ohio
-------------- Permit No. 2443
-------------------------------
8/97
