<PAGE>
[LOGO OF THE PARKSTONE ADVANTAGE APPEARS HERE]
[GRAPHIC APPEARS HERE]
Semi-Annual Report
June 30, 1998
Not FDIC Insured
<PAGE>
Table of Contents
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The Parkstone Advantage Fund June 30, 1998
<TABLE>
<S> <C>
Message From Your Chairman.................................................. 2
Message From Your Investment Adviser........................................ 3
Portfolio Performance Discussion............................................ 5
Statements of Assets and Liabilities........................................ 9
Statements of Operations.................................................... 10
Statements of Changes in Net Assets......................................... 11
Statements of Cash Flows.................................................... 13
Schedules of Portfolio Investments.......................................... 14
Notes to Financial Statements............................................... 23
Financial Highlights........................................................ 29
</TABLE>
1
<PAGE>
Message From Your Chairman
- -------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1998
Dear Shareholders:
We are pleased to report that during the six months ended June 30, 1998, the
financial markets continued to make strong gains. Over the course of the peri-
od, the Dow Jones Industrial Average moved 1044 points higher. With the pros-
pect of the first government budget surplus in decades and no prospect of in-
flation, the fixed-income markets gained ground as well. As a result, the pe-
riod was a good one for the financial markets and for investors.
A BROADER TALENT POOL AND MORE OPTIONS
It was also an eventful period for the Parkstone Advantage Fund. On March 31,
1998, the merger of National City and First of America Bank Corporation was
completed. As of that date, First of America Investment Corporation became
part of National City, which greatly expands distribution opportunities for
the Parkstone Advantage Fund.
In addition, as a direct result of the merger of National City and First of
America, our funds will be advised and managed by a larger team of investment
professionals.
This team, which includes many Parkstone Advantage managers, places a high
premium on disciplined investment management, quality performance and respon-
siveness to client service. The depth and breadth of expertise and experience
this team brings to our funds will enhance our ability to meet our clients'
objectives--as well as offer a broad array of investment products, strong in-
vestment performance and a comprehensive package of investment advice.
IN CLOSING . . .
In the pages that follow, you will find a detailed discussion of the perfor-
mance of each of the portfolios of the Parkstone Advantage Fund during the six
months ended June 30, 1998. You will also find a letter from our Investment
Adviser, which includes an economic outlook for the coming months. We urge you
to read this material closely.
Finally, we thank you for your continued confidence in us. As always, if you
have any questions or require any assistance, 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
-----------------------------------------------------------------------
NOTICE TO SHAREHOLDERS
PLEASE BE ADVISED OF THE FOLLOWING FACTS ABOUT MUTUAL FUNDS:
. YOUR PRINCIPAL IS AT RISK.
. NOT AN OBLIGATION OF FIRST OF AMERICA OR NATIONAL
CITY.
. NO FDIC COVERAGE.
-----------------------------------------------------------------------
2
<PAGE>
Message From Your Investment Adviser
- -------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1998
Dear Shareholders:
Benign inflation, low interest rates, an economy growing steadily--as Alan
Greenspan recently noted, domestic economic conditions have never been more
positive. In its eighth consecutive year of expansion, our economy is moving
along briskly--and there are few indications that a significant change in this
environment is in the offing. However, is this really the case?
FLU SYMPTOMS
While personal consumption and investment in the United States remain strong,
economies abroad, with the exception of Europe, are considerably weaker--and,
as a result of the situation in Asian markets and the sheer strength of the
dollar, may grow even weaker. Consequently, U.S. exports are slowing, and our
trade deficit is exploding. In fact, the deficit is now estimated to have sub-
tracted 2.2% from growth in the first quarter alone--and will likely dampen
growth over the next several quarters as a wave of imports from distressed
Asian manufacturers reaches our shores.
Of course, as the Federal Reserve has preached for several years, a slower
rate of growth is not necessarily negative. In fact, minutes from the March
meeting of the Federal Open Market Committee (FOMC) showed that the Fed
changed its bias from a neutral stance to one of tightening. At that meeting,
the members agreed that should the strength of the economic expansion and the
firming of the labor markets persist, policy tightening likely would be needed
at some point to head off imbalances that might undermine economic growth. But
the markets then--and now--clearly did not agree. The fed fund and Eurodollar
futures have yet to show a tightening priced in for 1998.
HIGHER OR LOWER INTEREST RATES?
Looking ahead, we believe the Fed will not tighten rates anytime soon. In
fact, we expect to see the economy growing in the range of 2.5% to 3.0% in the
second half of the year, with consumption and housing remaining strong, in-
vestment slowing and trade finally stabilizing, albeit at record deficit lev-
els. We believe inflation should remain calm given the continued decline in
goods prices, the strength of the dollar and the extremely competitive pricing
environment.
Consequently, while a case can be made for both higher and lower interest
rates, we believe the Fed will hold course through, at least, the summer.
Moreover, given the environment, consistently good news on inflation and the
continued turmoil in Asian and other markets, we believe the long bond has yet
to see its low. What then is the reason for concern?
THE BIGGER PICTURE . . .
In short, after eight years of uninterrupted expansion and increasing produc-
tivity, the U.S. economy and some corporations are now facing new and very
real pressures at home and abroad. In markets around the world, the strength
of the dollar is making U.S. goods prohibitively expensive for potential con-
sumers. At the same time, at home, with imports from markets with devalued
currencies entering the marketplace at record levels, corporations have very
little, if any, pricing power. This, coupled with increasing wage pressures
from a tight domestic labor market, is beginning to squeeze profit margins--
and should soon impact corporate profits and growth.
Previously, increases in productivity have more or less offset many of these
pressures. At this point, however, productivity has slowed. Consequently, af-
ter years of simply fantastic performance, we expect to see corporate profit
growth slow to lower--albeit very respectable by historic norms--levels. Thus,
earnings estimates may appear overly optimistic even while stocks are valued
at peak multiples and profits.
. . . AND WHAT IT SHOWS.
Consequently, we believe now is the time to approach the markets cautiously.
Looking out longer term, we are extremely optimistic regarding the markets. It
is our view that our economy has never been stronger, our corporations have
never been leaner, and the potential has never been as bright. Over the short
term, however, upside potential is somewhat limited, and downside risk is in-
creasing.
3
<PAGE>
Message From Your Investment Adviser, continued
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1998
In short, many trends that have fueled our past advances may be running out of
steam now. So, rather than seeing another year of double-digit gains in stock
prices, we would not be surprised to see the market return to its historic norm
of 9%.
Sincerely,
/s/ Mark R. Kummerer
Mark R. Kummerer
Director
4
<PAGE>
Portfolio Performance Discussion
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The Parkstone Advantage Fund June 30, 1998
MID CAPITALIZATION FUND
Investors' attention continued to focus on liquidity during the six months
ended June 30, 1998. As a result, the largest and best-known names performed
well during the period. Nonetheless, because the vast majority of mid- and
smaller capitalization stocks were overlooked and undervalued in comparison,
several of the portfolio's holdings made impressive gains.
Over the course of the period, Health Management Associates (3.2% of the port-
folio's net assets), Sun America (3.1%) and Finova (2.1%) all gained 50% or
more. Chancellor Media Corp. (2.9%)* rose an astonishing 112%. Nevertheless,
with market sentiment clearly favoring larger capitalization issues, mid-cap
stocks lagged, and smaller capitalization issues more or less wilted from ne-
glect. Focused on these sectors, and with a sizable portion of its assets in-
vested in small-cap issues, the Fund's performance lagged as well. For the six
months ended June 30, 1998, the Fund posted a total return of 13.21%.**
SENTIMENTAL FAVORITES
We remain very optimistic about the Fund's prospects in the year ahead. True
to any growth strategy, the portfolio is heavily weighted in health care and
technology: two sectors that we believe have more growth potential than many
others. In addition, the Fund has sizable positions in consumer cyclicals; due
to the economy's strong growth and high consumer confidence, we expect to see
this sector produce strong results in the coming year.
At the same time, however, investors still clearly favor larger capitalization
issues, and they may continue to outperform over the near-term. Nonetheless,
at some point, sentiment will shift. And, when it does, a correction would not
be surprising. At the very least, we could see a very choppy market. As a re-
sult, we expect to approach the market cautiously and maintain our highly dis-
ciplined earnings-growth approach to investing in mid-cap securities.
As of June 30, 1998, the top five holdings in the Fund's portfolio were Health
Management Associates (3.2% of the portfolio's net assets), Sun America
(3.1%), Chancellor Media Corp. (2.9%), Paychex (2.8%) and Omnicare (2.7%).*
- -------
* Portfolio composition is subject to change.
** Past performance is not indicative of future results.
- --------------------------------------------------------------------------------
Mid Capitalization Fund
Average Annual Total Return
As of June 30, 1998
- ----------------------------------
Since Inception
(9/23/93)
13.91%
- ----------------------------------
One Year
23.81%
- ----------------------------------
Return on a $10,000 Investment
(9/93 to 6/98)
[LINE GRAPH APPEARS HERE]
Mid Capitalization S&P MidCap 400
Fund Index
12/93 10,170 11,108
12/94 9,640 10,710
12/95 12,440 14,095
12/96 14,600 16,801
12/97 15,030 17,459
06/98 18,608 22,190
- --------------------------------------------------------------------------------
The Fund's performance is compared to the Standard & Poor's MidCap 400 Index
to better 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 indicative 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.
5
<PAGE>
Portfolio Performance Discussion, continued
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The Parkstone Advantage Fund June 30, 1998
SMALL CAPITALIZATION FUND+
Despite the strength of many companies in this sector, market sentiment con-
tinued to favor larger cap issues over the six months ended June 30, 1998. As
a result, while the earnings and profits of many of our holdings increased at
a rate double or triple that of large-cap issues, the stock prices of most re-
mained stable--or, in the case of health-care stocks, weakened.
Given the lack of interest in the sector, bright moments were few. Neverthe-
less, there were some, and they were impressive. With fundamentals simply too
attractive to be ignored, Omni Energy Services (0.6% of the portfolio's net
assets), Envoy (1.9%) and Staff Leasing (1.8%)* soared 40% or more over the
course of the period. Overall, however, the period was a discouraging one for
small-cap growth investors. For the six months ended June 30, 1998, the Fund
produced a total return of 7.30%.**
OUTSTANDING VALUES
Very simply, the continued and persistent underperformance of smaller compa-
nies is confounding. Clearly, the increase in acquisition activity, which ben-
efited the portfolio in the period just ended, is a strong sign that larger
companies see the depressed valuations of smaller companies, but, as yet, this
realization has not spread to investors more generally. We believe it will,
but timing is problematic.
With smaller companies showing better earnings growth than larger companies,
the valuations at a discount to their larger cap counterparts and with acqui-
sition activity heating up, we expect to see a change in sentiment toward
smaller companies as the year progresses. While this is our expectation, our
continued focus will be on individual sector and security selection. As in the
past, our success there will determine long-term returns, whatever the back-
ground markets trend.
- -------
+ Small-capital funds typically carry additional risks since smaller companies
generally have a higher risk of failure and, historically, their stocks have
experienced a greater degree of market volatility than stocks on average.
* Portfolio composition is subject to change.
** Past performance is not indicative of future results.
- --------------------------------------------------------------------------------
Small Capitalization Fund
Average Annual Total Return
As of June 30, 1998
- -------------------------------
Since Inception
(9/23/93)
16.44%
- -------------------------------
One Year
5.73%
- -------------------------------
Return on a $10,000 Investment
(9/93 to 6/98)
Small Capitalization Russell 2000
Fund Index
12/93 11,000 11,092
12/94 11,580 10,890
12/95 15,710 13,987
12/96 20,370 16,299
12/97 19,542 16,613
06/98 20,661 19,356
- --------------------------------------------------------------------------------
The Fund's performance is compared to the Russell 2000 Stock 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 indicative 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.
6
<PAGE>
Portfolio Performance Discussion, continued
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The Parkstone Advantage Fund June 30, 1998
INTERNATIONAL DISCOVERY FUND+
To put it simply, markets around the world were extraordinarily turbulent over
the six months ended June 30, 1998. As currency problems continued to plague
Asian markets, investors worried that this crisis would seriously reduce
global economic growth. At the same time, profound structural changes were
taking place in Europe as markets there moved closer toward monetary union.
These changes created a very positive environment for growth in the region.
Due to the fact that both Japanese and Southeast Asian stocks were de-empha-
sized in the portfolio, the Fund was less impacted by events in Asian markets,
or by the continuing declines in the Japanese economy. Continental European
and the United Kingdom's middle- and smaller capitalization stocks comprised a
much greater portion of the Fund's holdings. Here, however, much like the sit-
uation in the U.S. domestic market, investors favored larger capitalization
issues. Smaller and mid-cap issues--despite their fundamental strength--
lagged. Consequently, for the six months ended June 30, 1998, the Fund posted
a total return of 12.66%,* versus its benchmark, the Morgan Stanley Capital
International Europe, Australia and Far East (EAFE) Index, which produced a
total return of 16.08%.
GOING FORWARD
The environment for equities worldwide is uncertain as repercussions of events
in Asia are felt around the globe. However, we believe selected markets are
priced to perform well. In particular, we continue to believe Europe's markets
are attractive due to economic growth, corporate restructuring and a benign
interest rate outlook. Although share prices have risen, valuation is not
problematic relative to world equity averages or bond yields. Consequently, we
believe this region offers investors very real opportunity in the coming
months and year.
As of June 30, 1998, the top five holdings in the Fund's portfolio were Altran
Technologies (3.0% of the portfolio's net assets), SAP Preferred (2.9%), Oce
Van Grinten (2.9%), Mannesmann AG (2.9%) and Nestles Reg. (2.6%).**
- -------
+ International investing involves increased risk and volatility.
* Past performance is not indicative of future results.
** Portfolio composition is subject to change.
- --------------------------------------------------------------------------------
International Discovery Fund
Average Annual Total Return
As of June 30, 1998
- --------------------------------
Since Inception
(9/23/93)
7.41%
- --------------------------------
One Year
3.74%
- --------------------------------
Return on a $10,000 Investment
(9/93 to 6/98)
[LINE GRAPH APPEARS HERE]
International Discovery MSCI EAFE
Fund Index
12/93 10,350 9,037
12/94 9,650 9,740
12/95 10,590 10,832
12/96 12,222 11,486
12/97 13,557 14,411
06/98 14,063 15,330
- --------------------------------------------------------------------------------
The Fund's performance is compared to the Morgan Stanley Capital International
Europe, Australia and Far East (MSCI 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 indicative 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
<PAGE>
Portfolio Performance Discussion, continued
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The Parkstone Advantage Fund June 30, 1998
BOND FUND
In short, the six-month period ended June 30, 1998, was relatively quiet, yet
positive in the fixed-income markets. Solid economic growth, benign inflation
and a neutral Federal Reserve continued to put downward pressure on interest
rates. In addition, turmoil in Asian markets prompted investors to seek qual-
ity and safety--and many found it in the U.S. fixed-income markets. As a re-
sult, rates fluctuated narrowly throughout the period.
Because the Fund was conservatively positioned, events in Asia did not signif-
icantly or noticeably impact the Fund compared to many of its peers. In addi-
tion, throughout the period, we moved quickly to capitalize on a number of ex-
tremely attractive opportunities in the corporate sector as these bonds suf-
fered a bout of the "Asian flu." As a result, the Fund performed strongly over
the course of the six months ended June 30, 1998, producing a total return of
3.27%.*
A LONG-TERM PERSPECTIVE
Given the environment, the months ahead may be even quieter for bond invest-
ors--which, we believe, will significantly reduce opportunities to implement
short-term strategies. Longer-term sector strategies seem to hold the greatest
prospect for success, and consequently, in the coming months, barring any sig-
nificant change in the environment, we expect to focus our efforts in this ar-
ea.
As of June 30, 1998, approximately 40.7% of the Fund's net assets were in-
vested in corporate bonds, 25.9% in U.S. Treasury and agency securities, 16.8%
in asset-backed securities and 16.7% in mortgage-backed securities, with the
remainder invested in a range of government securities.** As of the same date,
the average maturity of the portfolio's holdings was 9.3 years; the average
credit quality, AAA.
- -------
* Past performance is not indicative of future results.
** Portfolio composition is subject to change.
The Parkstone Advantage Fund is a family of mutual funds distributed by BISYS
Fund Services. For more complete information on the Parkstone Advantage Fund,
including fees, expenses and sales charges, please call 1-800-451-8377 for a
free prospectus. Please read the prospectus carefully before investing or
sending money.
THIS MATERIAL IS AUTHORIZED FOR DISTRIBUTION TO PROSPECTIVE INVESTORS ONLY
WHEN PRECEDED OR ACCOMPANIED BY A PROSPECTUS.
- --------------------------------------------------------------------------------
Bond Fund
Average Annual Total Return
As of June 30, 1998
- ------------------------------
Since Inception
(9/23/93)
4.76%
- ------------------------------
One Year
8.69%
- ------------------------------
Return on a $10,000 Investment
(9/93 to 6/98)
[LINE GRAPH APPEARS HERE]
Salomon Brothers
Bond Fund Broad Index
12/93 9,960 10,010
12/94 9,424 9,725
12/95 11,024 11,531
12/96 11,226 11,948
12/97 11,487 12,304
06/98 12,481 13,607
- --------------------------------------------------------------------------------
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.
8
<PAGE>
Statements of Assets and Liabilities
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1998
(Unaudited)
<TABLE>
<CAPTION>
MID SMALL INTERNATIONAL
BOND CAPITALIZATION CAPITALIZATION DISCOVERY
FUND FUND FUND FUND
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
ASSETS:
Investments in securities, at value (Cost $12,346,831; $24,925,701;
$20,345,413; and $15,153,688, respectively)...................... $12,508,740 $33,513,254 $26,512,543 $19,838,108
Repurchase agreements, at cost..................................... -- 5,901,071 -- --
----------- ----------- ----------- -----------
Total Investments.................................................. 12,508,740 39,414,325 26,512,543 19,838,108
Foreign currency................................................... -- -- -- 12,536
Interest and dividends receivable.................................. 162,565 9,290 2,983 26,227
Reclaim receivable................................................. -- -- -- 12,579
Receivable for currency contracts.................................. -- -- -- 12,174
Receivable for investments sold.................................... 149,984 364,344 553,927 --
Unamortized organization costs..................................... 1,011 609 530 --
Prepaid expenses and other assets.................................. 4,277 4,253 3,132 4,852
----------- ----------- ----------- -----------
Total Assets....................................................... 12,826,577 39,792,821 27,073,115 19,906,476
----------- ----------- ----------- -----------
LIABILITIES:
Payable for return of collateral received for securities on loan... -- 7,400,800 -- --
Payable for investments purchased.................................. 152,159 -- 176,243 --
Payable for foreign currency contracts............................. -- -- -- 12,536
Accrued expenses and other payables:
Investment advisory fees......................................... 1,021 3,439 2,866 2,771
Administration fees.............................................. 2,209 5,471 4,516 3,480
Custodian fees................................................... 91 198 167 7,433
Accounting and transfer agent fees............................... -- 1,002 831 856
Legal and audit fees............................................. 3,663 13,981 13,163 8,488
Trustees' fees................................................... 129 446 195 297
Printing fees.................................................... 3,391 11,673 10,405 9,431
Other............................................................ 867 42 38 1,906
----------- ----------- ----------- -----------
Total Liabilities.................................................. 163,530 7,437,052 208,424 47,198
----------- ----------- ----------- -----------
NET ASSETS:
Capital............................................................ 11,634,116 23,180,165 19,808,320 14,718,778
Accumulated undistributed net investment income (loss)............. 910,450 (179,363) (176,984) (91,239)
Net unrealized appreciation from investments and translation of
assets and liabilities in foreign currencies...................... 161,909 8,587,553 6,167,130 4,551,413
Accumulated undistributed net realized gain (loss) from
investment and foreign currency transactions...................... (43,428) 767,414 1,066,225 680,326
----------- ----------- ----------- -----------
Net Assets......................................................... $12,663,047 $32,355,769 $26,864,691 $19,859,278
=========== =========== =========== ===========
Outstanding units of beneficial interest (shares).................. 1,145,721 2,007,899 1,462,798 1,422,387
=========== =========== =========== ===========
Net asset value -- redemption price per share...................... $ 11.05 $ 16.11 $ 18.37 $ 13.96
=========== =========== =========== ===========
</TABLE>
See notes to financial statements.
9
<PAGE>
Statements of Operations
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund For the Six Months Ended June 30, 1998
(Unaudited)
<TABLE>
<CAPTION>
MID SMALL INTERNATIONAL
BOND CAPITALIZATION CAPITALIZATION DISCOVERY
FUND FUND FUND FUND
-------- -------------- -------------- -------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest income.......... $388,062 $ -- $ 94 $ --
Dividend income.......... 17,268 55,283 37,565 189,654
Securities lending in-
come.................... -- 9,677 -- --
Foreign tax withholding.. -- -- -- (18,994)
-------- ---------- ---------- ----------
Total Income........... 405,330 64,960 37,659 170,660
-------- ---------- ---------- ----------
EXPENSES:
Investment advisory fees. 45,056 157,277 134,510 121,484
Administration fees...... 12,177 31,456 26,902 19,438
Custodian and accounting
fees.................... 9,206 11,799 11,176 24,999
Legal and audit fees..... 4,115 17,739 17,374 11,034
Organization costs....... 957 742 821 895
Registration and filing
fees.................... 199 1,172 1,529 193
Trustees' fees and ex-
penses.................. 1,107 3,288 2,868 1,896
Transfer agent fees...... 7,220 7,220 7,228 7,220
Printing costs........... 2,851 13,390 11,887 7,261
Other.................... 87 240 348 1,269
-------- ---------- ---------- ----------
Total Expenses......... 82,975 244,323 214,643 195,689
-------- ---------- ---------- ----------
Net Investment Income
(Loss).................. 322,355 (179,363) (176,984) (25,029)
-------- ---------- ---------- ----------
REALIZED/UNREALIZED GAIN
(LOSS) FROM INVESTMENTS
AND FOREIGN CURRENCIES:
Net realized gain (loss)
from investment
transactions and foreign
currency transactions... 120,105 831,122 1,760,690 706,968
Net change in unrealized
appreciation
(depreciation) from
investments and
translation of assets
and liabilites in
foreign currencies...... (47,708) 3,237,435 281,354 1,629,138
-------- ---------- ---------- ----------
Net realized/unrealized
gain (loss) from
investments............. 72,397 4,068,557 2,042,044 2,336,106
-------- ---------- ---------- ----------
Change in net assets re-
sulting from operations. $394,752 $3,889,194 $1,865,060 $2,311,077
======== ========== ========== ==========
</TABLE>
See notes to financial statements.
10
<PAGE>
Statements of Changes in Net Assets
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund
<TABLE>
<CAPTION>
BOND FUND MID CAPITALIZATION FUND
----------------------------- -----------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
JUNE 30, DECEMBER 31, JUNE 30, DECEMBER 31,
1998 1997 1998 1997
---------------- ------------ ---------------- ------------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C>
FROM INVESTMENT ACTIVI-
TIES:
OPERATIONS:
Net investment income
(loss)................ $ 322,355 $ 569,913 $ (179,363) $ (244,850)
Net realized gain
(loss) from investment
transactions.......... 120,105 63,027 831,122 21,346
Net change in
unrealized
appreciation
(depreciation) from
investments........... (47,708) 170,944 3,237,435 3,644,864
----------- ----------- ----------- -----------
Change in net assets re-
sulting from opera-
tions.................. 394,752 803,884 3,889,194 3,421,360
----------- ----------- ----------- -----------
DISTRIBUTIONS TO SHARE-
HOLDERS:
From net investment in-
come.................. -- (416,938) -- --
From net realized gains
from investment trans-
actions............... -- -- -- (4,029,590)
In excess of net real-
ized gains from in-
vestment transactions. -- -- -- (37,172)
----------- ----------- ----------- -----------
Change in net assets
from shareholder dis-
tributions............. -- (416,938) -- (4,066,762)
----------- ----------- ----------- -----------
CAPITAL TRANSACTIONS:
Proceeds from shares
issued................ 2,279,884 2,700,591 2,615,037 9,574,756
Dividends reinvested... -- 416,938 -- 4,066,762
Cost of shares re-
deemed................ (1,867,776) (1,402,718) (5,207,641) (5,977,525)
----------- ----------- ----------- -----------
Change in net assets
from shares transac-
tions.................. 412,108 1,714,811 (2,592,604) 7,663,993
----------- ----------- ----------- -----------
Change in net assets.... 806,860 2,101,757 1,296,590 7,018,591
NET ASSETS:
Beginning of period.... 11,856,187 9,754,430 31,059,179 24,040,588
----------- ----------- ----------- -----------
End of period.......... $12,663,047 $11,856,187 $32,355,769 $31,059,179
=========== =========== =========== ===========
CAPITAL SHARE TRANSAC-
TIONS:
Issued................. 210,227 257,089 169,985 667,987
Reinvested............. -- 40,323 -- 291,943
Redeemed............... (172,122) (133,754) (345,414) (423,731)
----------- ----------- ----------- -----------
Change in shares....... 38,105 163,658 (175,429) 536,199
=========== =========== =========== ===========
</TABLE>
See notes to financial statements.
11
<PAGE>
Statements of Changes in Net Assets, continued
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund
<TABLE>
<CAPTION>
SMALL CAPITALIZATION FUND INTERNATIONAL DISCOVERY FUND
-------------------------------- -------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
JUNE 30, DECEMBER 31, JUNE 30, DECEMBER 31,
1998 1997 1998 1997
---------------- ------------- ---------------- ------------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C>
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income (loss).................................... $ (176,984) $ (307,909) $ (25,029) $ (87,819)
Net realized gain (loss) from investment transactions
and foreign currency transactions.............................. 1,760,690 (687,260) 706,968 377,500
Net change in unrealized appreciation (depreciation) from
investments and translation of assets and liabilities in
foreign currencies............................................. 281,354 (135,425) 1,629,138 (1,551)
----------- ----------- ----------- -----------
Change in net assets resulting from operations................... 1,865,060 (1,130,594) 2,311,077 288,130
----------- ----------- ----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS:
From net realized gains from investment transactions............ -- (139,967) (80,360) --
----------- ----------- ----------- -----------
Change in net assets from shareholder distributions.............. -- (139,967) (80,360) --
----------- ----------- ----------- -----------
CAPITAL TRANSACTIONS:
Proceeds from shares issued..................................... 2,183,658 9,004,859 1,138,692 5,616,329
Dividends reinvested............................................ -- 139,967 80,244
Cost of shares redeemed......................................... (4,044,499) (5,509,017) (2,374,736) (4,120,845)
----------- ----------- ----------- -----------
Change in net assets from shares transactions.................... (1,860,841) 3,635,809 (1,155,800) 1,495,484
----------- ----------- ----------- -----------
Change in net assets............................................. 4,219 2,365,248 1,074,917 1,783,614
NET ASSETS:
Beginning of period............................................. 26,860,472 24,495,224 18,784,361 17,000,747
----------- ----------- ----------- -----------
End of period................................................... $26,864,691 $26,860,472 $19,859,278 $18,784,361
=========== =========== =========== ===========
CAPITAL SHARE TRANSACTIONS:
Issued.......................................................... 122,349 547,940 85,550 443,342
Reinvested...................................................... -- 7,665 5,619 --
Redeemed........................................................ (228,431) (332,723) (179,220) (328,257)
----------- ----------- ----------- ----------
Change in shares................................................ (106,082) 222,882 (88,051) 115,085
=========== =========== =========== ==========
</TABLE>
See notes to financial statements.
12
<PAGE>
Statements of Cash Flows
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1998
(Unaudited)
<TABLE>
<CAPTION>
MID
CAPITALIZATION
FUND
--------------
<S> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Total investment income....................................... $ 64,960
Net expenses.................................................. (244,323)
------------
Net investment income (loss)................................. (179,363)
Adjustments to reconcile net investment income to net cash pro-
vided (used) by operating activities:
Change in interest and dividend receivable.................... (5,089)
Change in accrued expenses and other assets................... (2,435)
------------
Total adjustments............................................. (7,524)
------------
Net cash provided (used) by operating activities............. (186,887)
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sales of investments............................ 14,305,767
Purchases of investments...................................... (11,526,306)
Net purchases of short-term investments....................... 7,400,800
------------
Net cash provided (used) by investing activities............. 10,180,261
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from shares issued................................... 2,615,037
Cost of shares redeemed....................................... (5,207,641)
Net proceeds received from short-term borrowings.............. (7,400,800)
------------
Net cash provided (used) by financing activities............. (9,993,404)
Net increase (decrease) in cash................................. (30)
Cash at beginning of period..................................... 30
------------
Cash at end of period........................................... $ --
============
</TABLE>
See notes to financial statements.
13
<PAGE>
Schedule of Portfolio Investments
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1998
Bond Fund (Unaudited)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
---------- ----------------------------------------------------- -----------
<C> <S> <C>
ASSET BACKED SECURITIES (13.0%):
$ 194,482 Banc One Auto Grantor Trust,
Series A, 6.27%, 11/20/03........................... $ 195,420
185,867 Banc One Auto Grantor Trust, Series B, 6.29%,
7/20/04............................................. 187,348
315,000 Discover Card Master Trust,
6.05%, 8/18/08...................................... 316,849
300,000 First Plus Home Loan Trust,
6.27%, 5/10/13...................................... 300,656
100,000 Green Tree Financial Corp.,
6.90%, 4/15/19...................................... 101,311
36,210 Lehman FHA--Title 1 Loan Trust, 6.78%, 3/25/08....... 36,401
150,000 Sears Credit Account Master Trust, 6.50%, 10/15/03... 151,078
370,000 UCFC Home Equity Loan 98-B A8, 6.18%, 10/15/29....... 368,671
-----------
Total Asset Backed Securities 1,657,734
-----------
MORTGAGE-BACKED SECURITIES (4.8%):
250,000 First Union, 6.56%, 11/18/08......................... 257,578
300,000 Sequoia Trust 3A, 6.35%, 6/25/28..................... 299,625
47,699 Structured Asset Securities Co.,
7.50%, 8/25/26...................................... 47,892
-----------
Total Mortgage-Backed Securities 605,095
-----------
CORPORATE BONDS (41.9%):
Automotive Finance (2.1%):
250,000 Ford Motor Credit, 8.20%, 2/15/02.................... 267,188
-----------
Banking (3.0%):
325,000 Swiss Bank, 7.75%, 9/1/26............................ 375,375
-----------
Consumer Goods & Services (2.4%):
300,000 Nike, Inc., 6.38%, 12/1/03........................... 304,125
-----------
Financial Services (15.1%):
250,000 Associates Corp., 6.00%, 4/15/03..................... 248,750
285,000 Chase Capital II, 6.36%, 2/1/27...................... 278,593
250,000 Countrywide Home, 6.84%, 10/22/04.................... 257,188
125,000 General Electric Capital Corp.,
7.62%, 5/8/00....................................... 128,750
370,000 General Electric Capital Corp.,
6.18%, 6/25/15...................................... 369,132
275,000 Salomon Smith Barney,
6.25%, 1/15/05...................................... 272,594
325,000 Travelers Capital, Series II,
7.75%, 12/1/36...................................... 347,344
-----------
1,902,351
-----------
Food & Household Products (2.7%):
350,000 Nabisco, Inc., 6.38%, 2/1/35......................... 347,375
Foreign Governments (2.1%):
$ 250,000 Quebec Province, 13.00%, 10/1/13...................... $ 265,625
-----------
Industrial Goods & Services (10.0%):
250,000 Honeywell, Inc., 6.75%, 3/15/02....................... 256,875
105,000 IBM Corp., 6.50%, 1/15/28............................. 104,869
300,000 Monsanto Co., 6.11%, 2/3/05........................... 301,125
300,000 Northrop-Grumman, 7.88%, 3/1/26....................... 343,499
250,000 Times Mirror Co., 6.61%, 9/15/27...................... 259,063
-----------
1,265,431
-----------
Oil & Gas (2.0%):
240,000 Amoco Canada, 6.75%, 2/15/05.......................... 250,800
-----------
Resorts & Entertainment (1.3%):
150,000 Time Warner Entertainment,
9.63%, 5/1/02........................................ 167,813
-----------
Telecommunications (1.2%):
150,000 GTE Southwest, 6.54%, 12/1/05......................... 153,375
-----------
Total Corporate Bonds 5,299,458
-----------
GOVERNMENT OBLIGATIONS (36.5%):
Mortgage Pass Thrus (13.6%):
Federal National Mortgage Assoc. (6.4%):
300,000 8.00%, 2/25/21........................................ 308,742
340,943 7.00%, 9/1/27......................................... 345,679
151,114 6.50%, 11/1/27........................................ 150,463
-----------
804,884
-----------
Government National Mortgage Assoc. (7.2%):
207,252 6.50%, 9/15/23........................................ 206,864
687,558 7.50%, 8/15/25........................................ 708,461
-----------
915,325
-----------
1,720,209
-----------
U.S. Treasury Obligations (22.9%):
U.S. Treasury Bonds (1.7%):
200,000 6.38%, 8/15/27........................................ 219,842
-----------
U.S. Treasury Notes (21.2%):
100,000 6.25%, 6/30/02........................................ 102,441
410,000 6.25%, 8/31/02........................................ 420,398
350,000 7.88%, 11/15/04....................................... 392,917
1,660,000 6.50%, 10/15/06....................................... 1,761,259
-----------
2,677,015
-----------
2,896,857
-----------
Total Government Obligations 4,617,066
-----------
</TABLE>
Continued
14
<PAGE>
Schedule of Portfolio Investments
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1998
Bond Fund (Unaudited)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
---------- ------------------------------------------------------ -----------
<C> <S> <C>
INVESTMENT COMPANIES (2.6%):
329,387 Federated Prime Money Market.......................... $ 329,387
-----------
Total Investment Companies 329,387
-----------
Total Investments (Cost $12,346,831)(a)--98.8% 12,508,740
Other assets in excess of liabilities--1.2% 154,307
-----------
Total Net Assets--100.0% $12,663,047
===========
</TABLE>
- -------
Percentages indicated are based on net assets of $12,663,047.
(a) Represents cost for Federal income tax purposes and differs from value by
net unrealized appreciation of securities as follows:
Unrealized appreciation................................. $192,130
Unrealized depreciation................................. (30,221)
--------
Net unrealized appreciation............................. $161,909
========
See notes to financial statements.
15
<PAGE>
Schedule of Portfolio Investments
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1998
Mid Capitalization Fund (Unaudited)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
- --------- --------------------------------------- -----------
<S> <C> <C>
COMMON STOCKS (94.3%):
Apparel/Shoes (1.0%):
7,300 Brylane, Inc.(b)(c).................... $ 335,800
-----------
Broadcasting & Publishing (6.4%):
27,400 CanWest Global
Communications Corp. ................. 440,113
19,300 Chancellor Media Corp.(b)(c)........... 958,365
6,150 Clear Channel Communications, Inc.(b).. 671,119
-----------
2,069,597
-----------
Building Products (1.2%):
13,400 Royal Group Technologies Ltd.(b)....... 388,600
-----------
Business Services (10.2%):
13,300 BA Merchant Services, Inc.(b).......... 268,494
12,400 Cambridge Technology Partners, Inc.(b). 677,350
11,100 Cintas Corp............................ 566,100
18,075 Concord EFS, Inc.(b)................... 472,209
22,480 Paychex, Inc........................... 914,654
10,200 U.S. Rentals, Inc.(b).................. 402,263
-----------
3,301,070
-----------
Commercial Services (0.9%):
6,500 Central Parking Corp................... 295,750
-----------
Computer Services (2.4%):
20,600 SunGard Data Systems, Inc.(b).......... 790,525
-----------
Computer Software & Peripherals (10.8%):
13,800 BMC Software, Inc.(b)(c)............... 716,737
18,400 Cadence Design Systems, Inc.(b)(c)..... 575,000
9,400 Citrix Systems, Inc.(b)................ 642,724
12,600 Parametric Technology Corp.(b)......... 341,775
6,800 PeopleSoft, Inc.(b).................... 319,600
8,100 VERITAS Software Corp.(b).............. 335,138
11,700 Visio Corp.(b)......................... 558,675
-----------
3,489,649
-----------
Data Processing & Reproduction (3.4%):
19,800 Fiserv, Inc.(b)........................ 840,881
5,400 Sterling Commerce, Inc.(b)(c).......... 261,900
-----------
1,102,781
-----------
Educational Services (4.4%):
8,400 Apollo Group, Inc.(b)(c)............... 277,725
11,200 CBT Group PLC(b)....................... 599,200
16,575 Sylvan Learning Systems, Inc.(b)....... 542,831
-----------
1,419,756
-----------
Financial Services (9.1%):
3,600 Cmac Investment Corp. ................. 221,400
12,300 Finova Group, Inc. .................... 696,488
10,800 Nationwide Financial Services.......... 550,800
17,700 Ocwen Financial Services Corp.(b)...... 475,688
17,600 SunAmerica, Inc.(c).................... 1,010,899
-----------
2,955,275
-----------
Funeral Services (3.4%):
14,300 Service Corp. International............ 613,112
17,900 Stewart Enterprises.................... 476,588
-----------
1,089,700
-----------
Health & Personal Care (0.8%):
10,100 Alberto-Culver Co.(c).................. 256,288
-----------
Health Care--Services (9.3%):
7,100 Health Care & Retirement Corp.(b)...... 280,006
31,625 Health Management Associates, Inc.(b) . 1,057,460
22,900 Omnicare, Inc. ........................ 873,063
8,900 Quintiles Transnational Corp.(b)....... 437,769
10,200 Total Renal Care Holdings, Inc.(b)(c).. 351,900
-----------
3,000,198
-----------
Manufacturing--Consumer Goods (2.2%):
14,300 Newell Co. ............................ 712,319
-----------
Medical Equipment & Supplies (3.0%):
6,800 Guidant Corp. ......................... 484,925
10,200 Henry Schein, Inc.(b).................. 470,475
-----------
955,400
-----------
Oilfield Services & Equipment (3.1%):
4,800 Camco International, Inc. ............. 373,800
7,100 Cooper Cameron Corp.(b)................ 362,100
24,700 Newpark Resources, Inc.(b)............. 274,788
-----------
1,010,688
-----------
Pharmaceuticals (1.3%):
9,900 Dura Pharmaceuticals, Inc.(b)(c)....... 221,512
5,900 Jones Medical Industries, Inc. ........ 195,438
-----------
416,950
-----------
Resorts & Entertainment (1.5%):
6,300 Royal Caribbean Cruises Ltd.(c)........ 500,850
-----------
Retail Stores (8.1%):
10,656 Dollar General Corp.(c)................ 421,578
27,200 Family Dollar Stores................... 503,200
14,200 Linens 'N Things, Inc.(b).............. 433,988
21,600 MSC Industrial Direct Co., Inc.(b)..... 615,600
20,200 Office Depot, Inc.(b)(c)............... 637,562
-----------
2,611,928
-----------
</TABLE>
Continued
16
<PAGE>
Schedule of Portfolio Investments
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1998
Mid Capitalization Fund (Unaudited)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ---------------------------------------------------- -----------
COMMON STOCKS, CONTINUED:
<S> <C> <C>
Semiconductors (1.1%):
11,400 Vitesse Semiconductor Corp.(b)...................... $ 351,975
-----------
Technology (5.0%):
10,000 MRV Communications(b)(c)............................ 207,500
9,900 Qwest Communications International, Inc.(b)......... 345,263
6,200 Sanmina Corp.(b)(c)................................. 268,925
8,900 Symbol Technologies, Inc. .......................... 335,975
7,100 Uniphase Corp.(b)(c)................................ 445,746
-----------
1,603,409
-----------
Telecommunications--Services & Equipment (2.0%):
9,200 Electric Lightwave(b)............................... 101,775
7,500 McLeod USA, Inc.(b)................................. 291,563
20,000 West TeleServices Corp.(b).......................... 242,500
-----------
635,838
-----------
Transportation & Shipping (1.3%):
8,600 Kansas City Southern Industries, Inc. .............. 426,775
-----------
Wholesale Distribution (0.7%):
16,700 Brightpoint, Inc.(b)(c)............................. 242,150
-----------
Wholesale Distribution--Pharmaceuticals (1.7%):
5,850 Cardinal Health, Inc. ............................. $ 548,438
-----------
Total Common Stocks 30,511,709
-----------
INVESTMENT COMPANIES (4.6%):
501,816 Federated Prime Money Market....................... 501,816
1,000,000 Provident T-Fund................................... 1,000,000
-----------
Total Investment Companies 1,501,816
-----------
SHORT TERM SECURITIES PURCHASED WITH COLLATERAL (22.9%):
Commercial Paper (4.6%):
$1,500,000 Lehman Brothers Holding, Inc.,
6.50%, 7/1/98..................................... 1,499,729
-----------
Repurchase Agreements (18.3%):
5,901,071 Paine Webber Triparty, 6.20%, 7/1/98
(Collateralized by multiple mortgage backed
securities with par of $397,212,497 and market
value of $246,752,287)............................ 5,901,071
-----------
Total Short Term Securities Purchased with Collateral 7,400,800
-----------
Total Investments (Cost $30,826,772)(a)--121.8% 39,414,325
Liabilities in excess of other assets--(21.8)% (7,058,556)
-----------
Total Net Assets--100.0% $32,355,769
===========
</TABLE>
- -------
Percentages indicated are based on net assets of $32,355,769.
(a) Represents cost for Federal income tax purposes and differs from value by
net unrealized appreciation of securities as follows:
Unrealized appreciation............................... $9,536,473
Unrealized depreciation............................... (948,920)
----------
Net unrealized appreciation........................... $8,587,553
==========
(b) Represents non-income producing securities.
(c) All or a portion of this security has been loaned at June 30, 1998.
See notes to financial statements.
17
<PAGE>
Schedule of Portfolio Investments
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1998
Small Capitalization Fund (Unaudited)
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
------ --------------------------------------------- -----------
<S> <C> <C>
COMMON STOCKS (95.8%):
Advertising (2.0%):
16,887 HA-LO Industries, Inc.(b).................... $ 525,608
-----------
Business Services (20.5%):
7,000 Applied Graphics Technologies, Inc.(b)....... 320,250
31,762 Concord EFS, Inc.(b)......................... 829,781
3,900 Dycom(b)..................................... 131,625
10,900 Envoy Corp.(b)............................... 516,387
8,600 Hagler Bailly, Inc.(b)....................... 222,525
4,300 Inspire Insurance Solutions(b)............... 142,975
13,000 International Telecommunications Data
Systems, Inc.(b)............................ 377,000
17,800 Medquist, Inc.(b)............................ 513,975
4,800 Metzler Group, Inc.(b)....................... 175,800
13,250 NCO Group, Inc.(b)........................... 291,500
7,400 NOVA Corp. (Georgia)(b)...................... 264,550
14,700 Novacare Employee Services(b)................ 139,650
21,600 Renaissance Worldwide, Inc.(b)............... 469,800
8,200 SOS Staffing Services, Inc.(b)............... 144,013
16,900 Staff Leasing, Inc.(b)....................... 498,550
15,850 Technology Solutions Co.(b).................. 502,247
-----------
5,540,628
-----------
Computer Hardware (1.2%):
11,850 Apex PC Solutions, Inc.(b)................... 330,319
-----------
Computer Software & Peripherals (13.4%):
11,600 Aspen Technologies, Inc.(b).................. 585,800
13,000 Axnet Technologies, Inc.(b).................. 398,125
12,150 Deltek Systems, Inc.(b)...................... 297,675
4,200 JDA Software Group, Inc.(b).................. 183,750
4,800 Macrovision Corp.(b)......................... 114,600
5,000 MEMCO Software, Inc.(b)...................... 95,000
1,400 New Dimension Software(b).................... 46,988
16,500 Pegasystems, Inc.(b)......................... 447,563
15,325 VERITAS Software Corp.(b).................... 634,071
17,500 Visio Corp.(b)............................... 835,624
-----------
3,639,196
-----------
Correctional Facilities (1.6%):
18,100 Wackenhut Corrections Corp.(b)............... 426,481
-----------
Environmental Services (1.5%):
8,600 American Disposal Services(b)................ 403,125
-----------
Financial Services (7.7%):
6,000 DVI, Inc.(b)................................. 153,000
19,300 Franchise Mortgage Acceptance Co.(b)......... 503,006
19,914 Imperial Credit Industries, Inc.(b).......... 467,979
8,400 Metris Cos., Inc. ........................... 535,500
15,400 Sirrom Capital Corp.......................... 400,400
-----------
2,059,885
-----------
Funeral Services (1.1%):
12,100 Equity Corp. International(b)................ $ 290,400
-----------
Health Care--Services (12.7%):
23,200 American Oncology Resources, Inc.(b)......... 283,475
7,100 Boron, Lepore & Assoc., Inc.(b).............. 269,800
11,300 Capital Senior Living Corp.(b)............... 139,131
9,700 Carematrix Corp.(b).......................... 261,294
6,300 Concentra Managed Care, Inc.(b).............. 163,800
3,900 Healthcare Financial Partners, Inc.(b)....... 239,119
16,100 NCS HealthCare, Inc., Class A(b)............. 458,850
30,500 Orthodontic Centers of America, Inc.(b)...... 638,593
15,400 Parexel International Corp.(b)............... 560,175
13,150 Serologicals Corp.(b)........................ 424,088
-----------
3,438,325
-----------
Insurance (0.6%):
6,900 Annuity & Life Re(b)......................... 152,663
-----------
Manufactured Housing (0.5%):
6,600 Modtech, Inc.(b)............................. 131,175
-----------
Medical Equipment & Supplies (1.4%):
2,900 Cryolife, Inc.(b)............................ 45,675
7,300 Molecular Devices Corp.(b)................... 117,713
4,600 Sabratek Corp.(b)............................ 104,650
6,400 Schick Technologies, Inc.(b)................. 98,800
-----------
366,838
-----------
Merchandising (0.8%):
5,500 QRS Corp.(b)................................. 206,938
-----------
Oilfield Services & Equipment (2.1%):
23,100 IRI International Corp.(b)................... 255,543
10,300 Key Energy Group, Inc.(b).................... 135,188
11,800 Omni Energy Services(b)...................... 160,775
-----------
551,506
-----------
Pharmaceuticals (3.2%):
17,400 Dura Pharmaceuticals, Inc.(b)................ 389,325
14,375 Jones Medical Industries, Inc................ 476,172
-----------
865,497
-----------
Printing & Publishing (1.8%):
8,150 Consolidated Graphics, Inc.(b)............... 480,850
-----------
Records Management (2.3%):
2,800 F.Y.I., Inc.(b).............................. 79,800
8,600 Iron Mountain, Inc.(b)....................... 384,850
2,800 Lason, Inc.(b)............................... 152,600
-----------
617,250
-----------
</TABLE>
Continued
18
<PAGE>
Schedule of Portfolio Investments
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1998
Small Capitalization Fund (Unaudited)
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
------ ----------------------------------------------- -----------
<S> <C> <C>
COMMON STOCKS, CONTINUED:
Rental Equipment Furniture (3.4%):
15,000 Rental Service Corp.(b)........................ $ 504,375
14,300 Renter's Choice, Inc.(b)....................... 405,763
-----------
910,138
-----------
Resorts & Entertainment (3.3%):
10,350 Family Golf Centers, Inc.(b)................... 261,984
21,200 Signature Resorts, Inc.(b)..................... 349,800
14,300 Vistana, Inc.(b)............................... 262,763
-----------
874,547
-----------
Restaurants (2.5%):
18,250 Landry's Seafood Restaurants(b)................ 330,210
14,500 The Cheesecake Factory(b)...................... 328,063
-----------
658,273
-----------
Retail--Speciality Stores (1.4%):
9,300 Insight Enterprises(b)......................... 372,000
-----------
Retail Stores (2.3%):
7,900 Party City Corp.(b)............................ 232,063
11,475 The Men's Warehouse, Inc.(b)................... 378,675
-----------
610,738
-----------
Technology (2.6%):
16,400 Sanmina Corp.(b)............................... 711,350
-----------
Telecommunications--Services & Equipment (2.8%):
10,600 Pacific Gateway Exchange, Inc.(b).............. 424,662
13,200 SmarTalk Teleservices, Inc.(b)................. 192,225
14,900 USN Communications, Inc.(b).................... 132,238
-----------
749,125
-----------
Transportation & Shipping (1.1%):
8,200 Eagle USA Airfreight, Inc.(b).................. $ 284,438
-----------
Wholesale Distribution (2.0%):
37,700 Brightpoint, Inc.(b)........................... 546,650
-----------
Total Common Stocks 25,743,943
-----------
FOREIGN COMMON STOCKS (2.5%):
Canada (0.6%):
Computer Software (0.6%):
13,100 Discreet Logic, Inc.(b)........................ 152,288
-----------
Israel (1.1%):
Computer Hardware (1.1%):
7,900 Nice Systems Ltd.(b)........................... 296,249
-----------
Medical Equipment & Supplies (0.8%):
6,550 ESC Medical Systems Ltd.(b).................... 221,063
-----------
Total Foreign Common Stocks 669,600
-----------
INVESTMENT COMPANIES (0.4%):
91,000 Federated Prime Money Market................... 91,000
8,000 Provident T-Fund............................... 8,000
-----------
Total Investment Companies 99,000
-----------
Total Investments (Cost $20,345,413)(a)--98.7% 26,512,543
Other assets in excess of liabilities--1.3% 352,148
-----------
Total Net Assets--100.0% $26,864,691
===========
</TABLE>
See notes to financial statements.
19
<PAGE>
Schedule of Portfolio Investments
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1998
International Discovery Fund (Unaudited)
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
------ -------------------------------- -----------
<S> <C> <C>
COMMON STOCKS (92.4%):
Argentina (0.5%):
3,400 YPF Sociedad Anonima, ADR....... $ 102,213
-----------
Australia (2.1%):
25,000 CSL Ltd.(b)....................... 161,778
20,000 Leighton Holdings............... 70,037
4,600 Lend Lease Corp. Ltd............ 93,005
11,398 Wesfarmers...................... 84,663
-----------
409,483
-----------
Austria (0.3%):
550 VA Technologies AG.............. 68,431
-----------
Belgium (2.7%)
500 Barco N.V....................... 139,747
500 Colrayt N.V..................... 392,368
-----------
532,115
-----------
Canada (1.2%):
5,000 Bombardier, Inc., Class B....... 136,004
12,000 CAE, Inc. ...................... 101,595
-----------
237,599
-----------
Chile (0.5%):
4,450 Cia de Telecomunicaciones de
Chile SA, ADR(b)................. 90,391
-----------
Denmark (0.9%):
1,000 Carli Gry International......... 80,704
650 Novo-Nordisk AS, Series B....... 89,602
-----------
170,306
-----------
Finland (4.2%):
3,000 Fnm Tieto Corporation........... 228,015
2,500 Huhtamaki Group................. 143,079
6,400 Nokia AB, Class A, ADR.......... 464,400
-----------
835,494
-----------
France (10.8%):
2,250 Alcatel Alstholm................ 458,110
2,680 Altran Technologies............. 608,604
1,350 Carbone Lorraine................ 119,682
360 Essilor International........... 152,252
450 Pinault-Printemps-Redoute SA.... 376,611
4,200 Sidel SA........................ 305,655
825 Television Francaise............ 127,857
-----------
2,148,771
-----------
Germany (7.8%):
2,520 Adidas AG...................... $ 435,582
2,500 Deutsche Pfandbrief-Und
Hypothekenbank AG............. 199,442
5,750 Mannesmann AG.................. 583,272
5,350 Siemens AG..................... 325,440
-----------
1,543,736
-----------
Greece (1.0%):
2,800 Hellenic Bottling Co. SA....... 86,499
4,444 Hellenic Telecommunication..... 113,930
-----------
200,429
-----------
Hong Kong (1.5%):
66,000 Hong Kong & China Gas Co.
Ltd.(b)....................... 74,956
27,000 Johnson Electric Holdings
Ltd.(b)....................... 100,005
90,000 NG Fung Hong Ltd. ............. 62,140
197,000 Qingling Motors Co. ........... 54,662
-----------
291,763
-----------
Israel (0.6%):
3,600 Teva Pharmaceutical Industries,
Ltd........................... 126,675
-----------
Italy (2.8%):
32,000 Bulgari SpA.................... 167,781
4,400 Gewiss SpA .................... 92,329
16,000 Safilo SpA .................... 116,385
30,000 Telecom Italia Mobile SpA ..... 183,455
-----------
559,950
-----------
Japan (16.5%):
14,000 Canon, Inc. ................... 317,758
24,000 Casio Computer ................ 222,906
6,000 Fuji Photo Film Ltd. .......... 208,812
4,900 Matsumotokiyoshi .............. 172,295
1,800 Nintendo ...................... 166,661
15,000 Omron Corp. ................... 229,131
16,000 Ricoh Co. Ltd. ................ 168,433
4,000 Rohm Corp. .................... 410,707
10,000 Sankyo Co. Ltd. ............... 227,690
3,400 Sony Corp. .................... 292,755
18,000 Takeda Chemical Industries .... 478,582
5,000 TDK Corp. ..................... 369,276
500 Union Tool(b) .................... 18,013
-----------
3,283,019
-----------
</TABLE>
Continued
20
<PAGE>
Schedule of Portfolio Investments
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1998
International Discovery Fund (Unaudited)
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
------ ------------------------------------------------- -----------
<S> <C> <C>
COMMON STOCKS, CONTINUED:
Mexico (1.2%):
5,140 Fomento Economico Mexicano, Sa de CV ADR......... $ 161,910
2,700 Panamerican Beverages ADR ....................... 84,881
-----------
246,791
-----------
Netherlands (9.0%):
6,542 Ahrend........................................... 213,541
2,300 Draka Holding ................................... 93,618
5,421 Getronics NV .................................... 281,127
6,133 Internatio-Muller NV ............................ 205,316
13,600 Oce Van Grinten ................................. 578,973
3,006 Wolters Kluwer NV ............................... 412,578
-----------
1,785,153
-----------
New Zealand (0.4%):
28,387 Fisher & Paykel Industries Ltd.................. 72,203
-----------
Philippines (0.5%):
4,000 Philippine Long Distance ADR.................... 90,500
Portugal (2.4%):
9,000 Portugal Telecom SA ............................. 476,438
South Africa (1.1%):
18,108 Dimension Data Holdings Ltd.(b) .................... 98,379
3,400 Liberty Life Association of Africa .............. 66,730
3,000 South African Breweries Ltd. .................... 62,139
-----------
227,248
-----------
Spain (3.3%):
6,000 Cortefiel SA..................................... 131,295
25,950 Prosegur Cia Seuguridad SA ...................... 309,353
10,000 Talbacalera SA .................................. 205,108
-----------
645,756
-----------
Sweden (2.4%):
2,300 Assa Abloy AB, Class B........................... 90,414
11,500 Atlas Copco AB .................................. 313,639
4,200 Lindab AB, Class B .............................. 76,364
-----------
480,417
-----------
Switzerland (5.6%):
250 Nestle SA, Registered............................ 535,004
140 Novartis AG...................................... 232,962
35 Roche Holdings AG................................ 343,699
-----------
1,111,665
-----------
United Kingdom (13.1%):
14,000 Airtours PLC..................................... $ 105,349
10,200 Bodycote International........................... 179,548
37,646 British Aerospace PLC............................ 288,309
8,150 Cobham PLC....................................... 142,782
34,000 Compass Group PLC................................ 391,432
8,000 D.F.S. Furniture Co. PLC......................... 26,362
121,533 Halma PLC (b).................................... 252,459
22,000 Johnson Matthey PLC.............................. 197,851
10,214 Logica PLC (b)................................... 330,190
85,000 Polypipe PLC..................................... 206,352
16,000 Siebe PLC........................................ 320,085
33,000 TT Group PLC..................................... 162,704
-----------
2,603,423
-----------
Total Common Stocks 18,339,969
-----------
PREFERRED STOCKS (5.9%):
Brazil (0.5%):
180,000 Banco Itau S.A................................... 101,936
-----------
Germany (5.4%):
1,200 Fresenius AG..................................... 223,375
290 Krones AG........................................ 116,480
860 SAP AG........................................... 584,599
130 Wella............................................ 146,922
-----------
1,071,376
-----------
Total Preferred Stocks 1,173,312
-----------
RIGHTS--FOREIGN SECURITIES (0.0%):
Hong Kong (0.0%):
3,000 Hong Kong & China Gas Co. Ltd.................... 205
-----------
Total Rights--Foreign Securities 205
-----------
INVESTMENT COMPANIES (1.6%):
127,234 Bank of California Sweep Account................. 127,234
100,250 Highmark Diversified Money Market Fund........... 100,250
97,138 Highmark US Government Money Market Fund......... 97,138
-----------
Total Investment Companies 324,622
-----------
Total Investments (Cost $15,153,688)(a)--99.9% 19,838,108
Other assets in excess of liabilities--0.1% 21,170
-----------
Total Net Assets--100.0% $19,859,278
===========
</TABLE>
- -------
Percentages indicated are based on net assets of $19,859,278.
Continued
21
<PAGE>
Schedule of Portfolio Investments
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1998
International Discovery Fund (Unaudited)
At June 30, 1998, International Discovery Fund's investment concentration, by
industry, was as follows:
Banking & Financial Services 2.70%
Computer Hardware 12.50%
Consumer Goods & Services 17.50%
Electrical & Electronic 8.80%
Engineering 9.00%
Healthcare 3.30%
Machinery & Building Products 15.50%
Pharmaceuticals 6.10%
Printing & Publishing 2.10%
Retail 3.90%
Telecommunications 7.40%
Other 11.20%
------
Total 100.00%
======
- -------
(a) Represents cost for Federal income tax purposes and differs from value by
net unrealized appreciation of securities as follows:
Unrealized appreciation............................... $5,432,562
Unrealized depreciation............................... (748,142)
----------
Net unrealized appreciation........................... $4,684,420
==========
(b) Represents non-income producing securities.
See notes to financial statements.
22
<PAGE>
Notes to Financial Statements
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1998
(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 Bond Fund, the Mid Capitalization Fund, the Small
Capitalization Fund and the International Discovery Fund (collectively, "the
Funds" and individually, a "Fund"). Sales of shares of the Funds may only be
made to separate accounts of various life insurance companies ("Participating
Insurance Companies") and certain qualified benefit plans. As of June 30,
1998 the only Participating Insurance Company is Security Benefit Life
Insurance Company. First of America Bank Corporation ("FABC"), the parent of
First of America Investment Corp. ("FIC"), recently completed its merger with
National City Corporation ("NCC"), the parent corporation of National City
Bank. As a result of the merger of FABC into NCC, FIC is a wholly-owned
subsidiary of NCC. FIC serves as an investment adviser to the Group.
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 (GAAP). 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 in common and preferred stocks, corporate bonds, commercial
paper and foreign government bonds and U.S. Government securities of the
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. Repurchase Agreements held
by the Funds are shown at original cost, which combined with accrued
interest, approximates market value. 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.
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.
Continued
23
<PAGE>
Notes to Financial Statements, continued
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1998
(Unaudited)
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.
The International Discovery Fund does not isolate that portion of the
results of operations resulting from changes in foreign exchange rates on
investments from the fluctuations arising from changes in market prices of
securities held. Such fluctuations are included with the net realized and
unrealized gains or losses from investments.
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).
LENDING PORTFOLIO SECURITIES:
To generate additional income, the Funds, may lend up to 33% of securities
in which they are invested pursuant to agreements requiring that the loan
be continuously secured by cash, U.S. Government or U.S. Government Agency
securities, shares of an investment trust or mutual fund, or any
combination of cash and such securities as collateral equal at all times to
at least 100% of the market value plus accrued interest on the securities
lent. The Funds continue to earn interest and dividends on securities lent
while simultaneously seeking to earn interest on the investment of
collateral.
When cash is received as collateral for securities loaned, the Funds may
invest such cash in short-term U.S. Government Securities, Repurchase
Agreements, or other short-term corporate securities. The cash or
subsequent short-term investments are recorded as assets of the Funds,
offset by a corresponding liability to repay the cash at the termination of
the loan. In addition, the short-term securities purchased with the cash
collateral are included in the accompanying schedules of portfolio
investments. Fixed
Continued
24
<PAGE>
Notes to Financial Statements, continued
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1998
(Unaudited)
income securities received as collateral are not recorded as an asset or
liability of the Fund because the Fund does not have effective control of
such securities.
There may be risks of delay in recovery of the securities or even loss of
rights in the collateral should the borrower of the securities fail
financially. However, loans will be made only to borrowers deemed by the
Adviser to be of good standing and creditworthy under guidelines
established by the Board of Trustees and when, in the judgment of the
Adviser, the consideration which can be earned currently from such
securities loans justifies the attendant risks. Loans are subject to
termination by the Funds or the borrower at any time, and are, therefore,
not considered to be illiquid investments. According to GAAP, a statement
of cash flows is presented if the Fund lent out, on average, more than 10%
of net assets during the year. Under this guideline, a statement of cash
flows is presented for the Mid Capitalization Fund. As of June 30, 1998,
the following Fund had securities with the following market values on loan:
<TABLE>
<CAPTION>
MARKET MARKET VALUE
VALUE OF OF LOANED
COLLATERAL SECURITIES
---------- ------------
<S> <C> <C>
Mid Capitalization Fund.............................. $7,400,800 $7,136,463
</TABLE>
The loaned securities were fully collateralized by cash, U.S. Government
securities, short-term corporate notes and repurchase agreements as of June
30, 1998.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
The Fund intends to pay, at least annually, substantially all of its net
investment income. Net capital gains, if any, are distributed at least
annually.
The amounts of dividends from net investment income and of distributions
from net realized gains are determined in accordance with federal income
tax regulations which may differ from GAAP. These "book/tax" differences
are either considered temporary or permanent in nature.
To the extent these differences are permanent in nature, such amounts are
reclassified within the composition of net assets based on their federal
tax-basis treatment; temporary differences do not require reclassification.
Dividends and distributions to shareholders which exceed net investment
income and net realized capital gains for financial reporting purposes but
not for tax purposes are reported as dividends in excess of net investment
income and net realized gains. To the extent they exceed net investment
income and net realized gains for tax purposes, they are reported as
distributions of capital.
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.
Continued
25
<PAGE>
Notes to Financial Statements, continued
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1998
(Unaudited)
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 months ended June 30, 1998, are as follows:
<TABLE>
<CAPTION>
PURCHASES SALES
---------- ----------
<S> <C> <C>
Bond Fund.............................................. $8,290,660 $7,855,640
Mid Capitalization Fund................................ 4,958,064 9,316,821
Small Capitalization Fund.............................. 5,466,967 7,442,147
International Discovery Fund........................... 4,603,720 5,021,235
</TABLE>
5. 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, Inc. ("BISYS Inc."), and
BISYS are subsidiaries of The BISYS Group, Inc.
Continued
26
<PAGE>
Notes to Financial Statements, continued
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund June 30, 1998
(Unaudited)
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
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 Inc. serves as Distributor to the Trust and as Mutual Fund
Accountant and Transfer Agent.
<TABLE>
<CAPTION>
MID SMALL INTERNATIONAL
BOND CAPITALIZATION CAPITALIZATION DISCOVERY
FUND FUND FUND FUND
------- -------------- -------------- -------------
<S> <C> <C> <C> <C>
INVESTMENT ADVISORY FEES:
Annual fee (percentage of
average net assets)..... 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%
FUND ACCOUNTING &
TRANSFER AGENT FEES(B).. $16,051 $17,915 $21,736 $ 21,142
</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.
(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. Each of the Small
Capitalization Fund, the Mid Capitalization Fund and the 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.
27
<PAGE>
Financial Highlights
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund
<TABLE>
<CAPTION>
BOND FUND
---------------------------------------------------------------------------------
FOR THE SHARE OUTSTANDING SIX MONTHS SEPTEMBER 23,
THROUGHOUT THE PERIOD ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED 1993 TO
JUNE 30, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997 1996 1995 1994 1993 (A)
----------- ------------ ------------ ------------ ------------ -------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD.... $ 10.70 $ 10.33 $ 10.50 $ 9.35 $ 9.96 $ 10.00
----------- ----------- ---------- ---------- ---------- ----------
INVESTMENT ACTIVITIES
Net investment income
(loss)................ 0.26 0.48 0.36 0.40 0.42 0.10
Net realized and
unrealized gains
(losses) from
investments........... 0.09 0.30 (0.18) 1.17 (0.96) (0.14)
----------- ----------- ---------- ---------- ---------- ----------
Total from Investment
Activities............ 0.35 0.78 0.18 1.57 (0.54) (0.04)
----------- ----------- ---------- ---------- ---------- ----------
DISTRIBUTIONS
From net investment in-
come.................. -- (0.41) (0.35) (0.42) (0.07) --
----------- ----------- ---------- ---------- ---------- ----------
Total Distributions.... -- (0.41) (0.35) (0.42) (0.07) --
----------- ----------- ---------- ---------- ---------- ----------
NET ASSET VALUE, END OF
PERIOD................. $ 11.05 $ 10.70 $ 10.33 $ 10.50 $ 9.35 $ 9.96
=========== =========== ========== ========== ========== ==========
Total Return............ 3.27%(b) 7.69% 1.83% 16.98% (5.38%) (0.40%)(b)
RATIOS/SUPPLEMENTARY DA-
TA:
Net Assets at end of pe-
riod................... $12,663,047 $11,856,187 $9,754,430 $6,758,241 $4,651,157 $3,216,233
Ratio of expenses to
average net assets..... 1.36%(c) 1.36% 1.29% 1.57% 1.80% 2.03% (c)
Ratio of net investment
income to average net
assets................. 5.29%(c) 5.36% 5.32% 5.31% 5.27% 5.23% (c)
Portfolio turnover rate. 68% 144% 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 MONTHS SEPTEMBER 23,
THROUGHOUT THE PERIOD ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED 1993 TO
JUNE 30, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997 1996 1995 1994 1993 (A)
----------- ------------ ------------ ------------ ------------ -------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD.... $ 14.23 $ 14.60 $ 12.44 $ 9.64 $ 10.17 $ 10.00
----------- ----------- ----------- ----------- ---------- ----------
INVESTMENT ACTIVITIES
Net investment income
(loss)................ (0.09) (0.11) (0.09) (0.08) (0.07) (0.02)
Net realized and
unrealized gains
(losses) from
investments........... 1.97 1.90 2.25 2.88 (0.46) 0.19
----------- ----------- ----------- ----------- ---------- ----------
Total from Investment
Activities............ 1.88 1.79 2.16 2.80 (0.53) 0.17
----------- ----------- ----------- ----------- ---------- ----------
DISTRIBUTIONS
From net realized
gains................. -- (2.16) -- -- -- --
----------- ----------- ----------- ----------- ---------- ----------
Total Distributions.... -- (2.16) -- -- -- --
----------- ----------- ----------- ----------- ---------- ----------
NET ASSET VALUE, END OF
PERIOD................. $ 16.11 $ 14.23 $ 14.60 $ 12.44 $ 9.64 $ 10.17
=========== =========== =========== =========== ========== ==========
Total Return............ 13.21% (b) 12.58% 17.36% 29.05% (5.21%) 1.70% (b)
RATIOS/SUPPLEMENTARY
DATA:
Net Assets at end of
period................. $32,355,769 $31,059,179 $24,040,588 $14,977,130 $9,095,015 $3,893,346
Ratio of expenses to
average net assets..... 1.55% (c) 1.53% 1.42% 1.62% 1.86% 2.11% (c)
Ratio of net investment
income to average net
assets................. (1.14%)(c) (0.88%) (0.73%) (0.84%) (0.92%) 1.09% (c)
Portfolio turnover rate. 16% 55% 127% 44% 51% 45%
</TABLE>
- -------
(a) Period from commencement of operations.
(b) Not Annualized
(c) Annualized
See notes to financial statements.
29
<PAGE>
Financial Highlights
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund
<TABLE>
<CAPTION>
SMALL CAPITALIZATION FUND
------------------------------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT SIX MONTHS SEPTEMBER 23,
THE PERIOD ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED 1993 TO
JUNE 30, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997 1996 1995 1994 1993 (A)
----------- ------------ ------------ ------------ ------------ -------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD..... $ 17.12 $ 18.20 $ 15.71 $ 11.58 $ 11.00 $ 10.00
----------- ----------- ----------- ----------- ---------- ----------
INVESTMENT ACTIVITIES
Net investment income
(loss)................. (0.12) (0.20) (0.15) (0.15) (0.13) (0.03)
Net realized and
unrealized gains
(losses) from
investments............ 1.37 (0.79) 4.79 4.28 0.71 1.03
----------- ----------- ----------- ----------- ---------- ----------
Total from Investment
Activities............. 1.25 (0.99) 4.64 4.13 0.58 1.00
----------- ----------- ----------- ----------- ---------- ----------
DISTRIBUTIONS
From net realized gains. -- (0.09) (2.15) -- -- --
----------- ----------- ----------- ----------- ---------- ----------
Total Distributions..... -- (0.09) (2.15) -- -- --
----------- ----------- ----------- ----------- ---------- ----------
NET ASSET VALUE, END OF
PERIOD.................. $ 18.37 $ 17.12 $ 18.20 $ 15.71 $ 11.58 $ 11.00
=========== =========== =========== =========== ========== ==========
Total Return............. 7.30% (b) (5.47%) 29.66% 35.66% 5.27% 10.00% (b)
RATIOS/SUPPLEMENTARY
DATA:
Net Assets at end of
period.................. $26,864,691 $26,860,472 $24,495,224 $13,272,561 $7,476,444 $3,064,765
Ratio of expenses to
average net assets...... 1.60% (c) 1.55% 1.40% 1.64% 1.98% 1.87% (c)
Ratio of net investment
income (loss) to average
net assets.............. (1.32%)(c) (1.20%) (1.06%) (1.29%) (1.66%) (1.40%)(c)
Ratio of expenses to
average net assets*..... 1.60% (c) 1.55% 1.40% 1.64% 1.98% 2.23% (c)
Ratio of net investment
income to average net
assets*................. (1.32%)(c) (1.20%) (1.06%) (1.29%) (1.66%) (1.76%)(c)
Portfolio turnover rate.. 21% 51% 60% 64% 39% 23%
</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
See notes to financial statements.
30
<PAGE>
Financial Highlights
- --------------------------------------------------------------------------------
The Parkstone Advantage Fund
<TABLE>
<CAPTION>
INTERNATIONAL DISCOVERY FUND
------------------------------------------------------------------------------------
FOR A SHARE OUTSTANDING SIX MONTHS SEPTEMBER 23,
THROUGHOUT THE PERIOD ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED 1993 TO
JUNE 30, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997 1996 1995 1994 1993 (A)
----------- ------------ ------------ ------------ ------------ -------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD.... $ 12.44 $ 12.18 $ 10.59 $ 9.65 $ 10.35 $ 10.00
----------- ----------- ----------- ----------- ---------- ----------
INVESTMENT ACTIVITIES
Net investment income
(loss)................ (0.02) (0.06) (0.04) (0.03) (0.07) (0.03)
Net realized and
unrealized gains
(losses) from
investments........... 1.60 0.32 1.67 0.97 (0.63) 0.38
----------- ----------- ----------- ----------- ---------- ----------
Total from Investment
Activities............ 1.58 0.26 1.63 0.94 (0.70) 0.35
----------- ----------- ----------- ----------- ---------- ----------
DISTRIBUTIONS
From net realized
gains................. (0.06) -- -- -- -- --
----------- ----------- ----------- ----------- ---------- ----------
Total Distributions.... (0.06) -- (0.04) -- -- --
----------- ----------- ----------- ----------- ---------- ----------
NET ASSET VALUE, END OF
PERIOD................. $ 13.96 $ 12.44 $ 12.18 $ 10.59 $ 9.65 $ 10.35
=========== =========== =========== =========== ========== ==========
Total Return............ 12.66% (b) 2.13% 15.41% 9.74% (6.76%) 3.50% (b)
RATIOS/SUPPLEMENTARY
DATA:
Net Assets at end of
period................. $19,859,278 $18,784,361 $17,000,747 $11,645,200 $9,537,019 $6,334,523
Ratio of expenses to
average net assets..... 2.01% (c) 1.90% 2.00% 2.38% 2.34% 2.51% (c)
Ratio of net investment
income (loss) to
average net assets..... (0.26%)(c) (0.46%) (0.35%) (0.39%) (1.13%) (1.38%)(c)
Portfolio turnover rate. 24% 34% 65% 86% 87% 13%
</TABLE>
- -------
(a) Period from commencement of operations.
(b) Not Annualized
(c) Annualized
See notes to financial statements.
31
<PAGE>
The Parkstone Advantage Fund
. Mid Capitalization Fund
. Small Capitalization Fund
. International Discovery Fund
. Bond Fund
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 executive prospectus, which
Not FDIC Insured contains details concerning the sales charges and other
pertinent information.
[BULK RATE POSTAGE PAID STAMP APPEARS HERE]
1
