<PAGE>
[LOGO OF THE GRIFFIN FUNDS]
SEMI-ANNUAL REPORT
MARCH 31, 1997
<PAGE>
Table of Contents
Message to Shareholders ................................................... 1
Performance Highlights of the Funds ....................................... 2
Schedules of Investments
The Griffin Money Market Fund ............................................. 3
The Griffin Tax-Free Money Market Fund .................................... 4
The Griffin Short-Term Bond Fund .......................................... 6
The Griffin U.S. Government Income Fund ................................... 8
The Griffin Bond Fund ..................................................... 9
The Griffin Municipal Bond Fund ........................................... 11
The Griffin California Tax-Free Fund ...................................... 13
The Griffin Growth & Income Fund .......................................... 15
The Griffin Growth Fund ................................................... 17
Financial Statements
Statements of Assets and Liabilities ...................................... 21
Statements of Operations .................................................. 23
Statements of Changes in Net Assets ....................................... 25
Financial Highlights ...................................................... 27
Notes to Financial Statements ............................................. 30
SHARES OF THE FUNDS ARE NOT DEPOSITS OR OBLIGATIONS OF, OR ISSUED, ENDORSED OR
GUARANTEED BY, HOME SAVINGS OF AMERICA, FSB ("HOME SAVINGS"), SAVINGS OF AMERICA
OR ANY OF THEIR AFFILIATES. SUCH SHARES ARE NOT INSURED BY THE U.S. GOVERNMENT,
THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY
OTHER GOVERNMENTAL AGENCY. AN INVESTMENT IN ANY OF THE FUNDS INVOLVES CERTAIN
RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL.
<PAGE>
Dear Fellow Shareholder:
We are pleased to present the Semi-Annual Report for The Griffin Funds, Inc. for
the six months ended March 31, 1997. In the charts and financial statements that
follow this letter you will find a more detailed summary of the performance of
each of The Griffin Funds and a description of the securities held in each of
the portfolios. We hope you will find this information useful as you evaluate
your investments.
The Griffin Funds were created in 1993 to provide a consistent, careful and
committed approach for those seeking to invest in the securities markets. Unlike
many other fund families, we utilize a two-tiered approach to investment
management. At the portfolio level, we employ some of this country's largest and
most respected investment firms to select on a day-to-day basis the individual
securities for your Funds' portfolios. Griffin Financial Investment Advisers
provides an additional level of supervision and review to ensure that each Fund
is in the best position to pursue the investment objectives defined in its
prospectus, and that each sub-adviser remains true to these objectives. We
believe this approach ensures that a consistent investment philosophy is applied
with respect to each Fund by responsible, experienced managers. Through this
approach, The Griffin Funds seek to provide high quality investment
opportunities specifically designed for customers of Home Savings/Savings of
America.
Market Overview
The stock and bond markets began the six month period
ended March 31, 1997 with impressive gains, but finished the period on a
somewhat less positive note. Early indications suggested that despite many fears
on Wall Street and in Washington, inflation failed to materialize as the economy
experienced moderately strong growth. Corporate earnings remained strong, and
the continuing appreciation of the U.S. Dollar helped position the U.S. markets
favorably for both domestic and foreign investors. Beginning in March of 1997,
however, concerns over increasing stock values and falling unemployment levels
caused both stock and bond prices to fall sharply. Yields on long term Treasury
bonds topped 7% (prices generally move in the opposite direction of yields) for
the first time since September 1996, and the Standard & Poor's 500 Composite
Index fell nearly 7% in the final three weeks of March. Smaller companies
experiencing above average earnings growth struggled to keep pace with the
broader market. So called "small cap" stocks have trailed their larger
counterparts considerably over the six month period due to a combination of
earnings disappointments and liquidity concerns.
Diversifying Your Investments
As many of the financial markets reach their all-time highs, some investors have
become concerned with the corresponding increase in volatility. Advisers often
recommend that investors diversify their holdings to help address these
concerns. By investing in any of The Griffin Funds you have taken the first step
towards diversification; your investment has been spread over many different
securities as detailed in the Schedules of Investments found in this report.
Additionally, a number of studies have indicated that as much as 90% of an
investor's long-term performance is the result of their allocation among asset
classes, not the timing of those allocations. As a supplement to direct mutual
fund investing, Griffin Financial Services has designed a disciplined, managed
investment program utilizing The Griffin Funds. This program, called the Griffin
Portfolio Builder Account, was constructed to provide investors with additional
diversification through asset allocation. I encourage you to contact your local
Griffin Financial Services representative to learn more about simplifying the
process of making these important investment decisions, and how The Griffin
Funds and the Portfolio Builder Account can help you achieve those objectives.
As always, we appreciate your selection of The Griffin Funds for your financial
management needs. We will do our best to preserve your confidence and loyalty.
Sincerely,
/s/ William A. Hawkins
William A. Hawkins
Chairman
The Griffin Funds, Inc.
May 15, 1997
- 1 -
<PAGE>
Performance Highlights of the Funds (Unaudited)
The table below provides yield and total return information for the periods
ended March 31, 1997 for The Griffin Funds. The seven day yields of the money
market funds refer to the income generated by an investment in a Fund over a
seven day period, expressed as an annual percentage rate. The seven day
effective yields are calculated similarly but assume that the income earned from
a Fund is reinvested in the Fund. The total returns indicate the percentage an
investment in a Fund would have changed in value had shares been purchased at
the beginning of each period, with all dividends and capital gain distributions
being reinvested. The performance information under the Past Six Months column
reflects cumulative total return. Average annual return is displayed in the two
adjacent columns. Certain fees payable by the Funds have been waived (and/or
expenses reimbursed) during periods up to and including the six months ended
March 31, 1997, which have reduced operating expenses for shareholders. Without
these reductions, the Funds' returns would have been lower. The table also
indicates the average performance of mutual funds with investment objectives
that are similar to each of the respective non-money market funds of The Griffin
Funds. For each of the non-money market funds, the group average reflects the
performance of a universe of mutual funds tracked by Lipper Analytical Services,
Inc. The Lipper mutual fund averages do not reflect the imposition of sales
charges, but do reflect the reinvestment of all dividends and capital gains, if
any. Of course, past performance is not an indicator of future results.
For the Periods Ended March 31, 1997
<TABLE>
<CAPTION>
Seven Day
Seven Day Effective
Yield Yield
----- -----
<S> <C> <C>
Money Market Fund(1) ............................. 4.95% 5.07%
Tax-Free Money Market Fund(1) .................... 2.92% 2.96%
Total Return
------------
Class A Class B
--------------------------- ---------------------------
Since Since
Past Six Past Inception Past Six Past Inception
Months Year (10/19/93) Months Year (11/1/94)
------ ---- ---------- ------ ---- ---------
<S> <C> <C> <C> <C> <C> <C>
U.S. Government Income Fund ....................... 2.07% 4.39% 4.85% 1.71% 3.76% 7.48%
U.S. Government Income Fund (incl. sales charge)(2) -2.52% -0.31% 3.47% -3.29% -1.24% 6.35%
Lipper General U.S. Govt. Average (187 funds) ..... 1.77% 3.48% n/a 1.77% 3.48% n/a
Bond Fund ......................................... 2.28% 3.87% 3.65% 2.15% 3.49% 7.49%
Bond Fund (incl. sales charge)(2) ................. -2.32% -0.81% 2.28% -2.85% -1.51% 6.36%
Lipper Corporate Debt A Rated Average (124 funds) . 2.31% 4.23 n/a 2.31% 4.23% n/a
California Tax-Free Fund .......................... 2.17% 4.59% 2.97% 1.92% 4.08% 7.90%
California Tax-Free Fund (incl. sales charge)(2) .. -2.43% -0.11% 1.61% -3.08% -0.92% 6.77%
Lipper CA Municipal Debt Average (108 funds) ...... 1.77% 5.23% n/a 1.77% 5.23% n/a
Municipal Bond Fund ............................... 1.89% 4.03% 3.18% 1.53% 3.51% 7.62%
Municipal Bond Fund (incl. sales charge)(2) ....... -2.69% -0.65% 1.82% -3.47% -1.49% 6.49%
Lipper General Municipal Debt Average (244 funds) . 1.95% 4.81% n/a 1.95% 4.81% n/a
Growth & Income Fund .............................. 10.98% 18.10% 18.29% 10.69% 17.48% 24.08%
Growth & Income Fund (incl. sales charge)(2) ...... 5.98% 12.78% 16.73% 5.69% 12.48% 23.16%
Lipper Growth & Income Average (639 funds) ........ 9.02% 15.47% n/a 9.02% 15.47% n/a
<CAPTION>
Class A Class B
--------------------------- ---------------------------
Since Since
Past Six Past Inception Past Six Past Inception
Months Year (6/12/95) Months Year (6/12/95)
<S> <C> <C> <C> <C> <C> <C>
Short-Term Bond Fund ............................... 2.19% 4.48% 5.21% 1.94% 4.05% 4.88%
Short-Term Bond Fund (incl. sales charge)(3) ....... -1.38% 0.82% 3.16% -2.06% 0.05% 3.27%
Lipper S.I. Investment Grade Debt Average (81 funds) 2.31% 4.72% n/a 2.31% 4.72% n/a
Growth Fund ........................................ -7.27% 1.84% 14.63% -7.45% 1.36% 14.17%
Growth Fund (incl. sales charge)(4) ................ -11.44% -2.75% 11.75% -12.45% -3.64% 12.16%
Lipper Mid Cap Equity Average (232 funds) .......... -4.28% 4.95% n/a -4.28% 4.95% n/a
</TABLE>
- ----------
(1) Investments in the Money Market Funds are neither insured nor guaranteed by
the U.S. Government. There can be no assurance that either of the Money
Market Funds will be able to maintain a stable net asset value of $1.00 per
share.
(2) The deduction of the maximum initial sales charge with respect to Class A
shares (4.5%) and the deduction of the maximum applicable contingent
deferred sales charge with respect to Class B shares (5% with respect to
the total return data presented for the six month and one year periods
ended September 30, 1996, and 3% with respect to the total return data
presented for the period from inception of the Class on November 1, 1994 to
September 30, 1996) has been factored into these calculations.
(3) The deduction of the maximum initial sales charge with respect to Class A
shares (3.5%) and the deduction of the maximum applicable contingent
deferred sales charge with respect to Class B shares (4% with respect to
the total return data presented for the six month and one year periods
ended September 30, 1996, and 3% with respect to the total return data
presented for the period from the inception on June 12, 1995 through
September 30, 1996) has been factored into these calculations.
(4) The deduction of the maximum initial sales charge with respect to Class A
shares (4.5%) and the deduction of the maximum applicable contingent
deferred sales charge with respect to Class B shares (5% with respect to
the total return data presented for the six month and one year periods
ended September 30, 1996, and 4% with respect to the total return data
presented for the period from inception on June 12, 1995 to September 30,
1996) has been factored into these calculations.
- 2 -
<PAGE>
Schedule of Investments (Unaudited)
Griffin Money Market Fund
March 31, 1997
[PIE CHART APPEARS HERE]
Bank Note 4%
Certificates of Deposit 4%
Commercial Paper 72%
U.S. Government Agency Notes 20%
Investment Categories Reflect Percentages of Investments in Securities
<TABLE>
<CAPTION>
Principal Market
Name of Issuer Amount Value(a)
- --------------------------------------------------------------------------------------------------
(Percentage of each investment category relate to total net assets)
<S> <C> <C>
Bank Note (4.1%):
Financial Services (4.1%):
Mercantile Trust, 5.16%, 1/30/98 ............. $ 8,300,000 $ 8,261,787
-----------
Total Bank Note (Cost: $8,261,787) ........................... 8,261,787
-----------
Certificate of Deposit (4.5%):
Financial Services (4.5%):
Union Bank of California, 5.28%, 4/18/97 ..... 9,000,000 9,000,000
-----------
Total Certificate of Deposit (Cost: $9,000,000) .............. 9,000,000
-----------
Commercial Paper (71.8%):
Financial Services (58.3%):
American Express Credit, 5.26%,
4/17/97 (b) .......................... 9,000,000 8,978,960
American General Finance Corporation,
5.50%, 4/23/97 (b) ................... 9,000,000 8,969,750
Bell Atlantic Financial Services Inc.,
5.51%, 4/29/97 (b) ................... 9,000,000 8,961,430
Canadian Wheat Board, 5.45%, 4/25/97 (b) ..... 9,000,000 8,967,300
Caterpillar Financial , 5.25%, 4/08/97 (b) ... 9,000,000 8,990,813
CIT Group Holdings, 5.23%, 4/16/97 (b) ....... 9,000,000 8,980,387
Ford Motor Credit Corporation,
5.55%, 4/29/97 (b) ................... 9,000,000 8,961,150
General Electric Capital Corporation,
5.33%, 4/25/97 (b) ................... 9,000,000 8,968,020
International Business Machines
Credit Corporation, 5.29%, 4/01/97 (b) 9,000,000 9,000,000
Toyota Motor Credit Corporation,
5.22%, 4/10/97 (b) ................... 9,000,000 8,988,255
Transamerica Corporation,
5.26%, 4/11/97 (b) ................... 9,000,000 8,986,850
Unilever Capital Corporation,
5.45%, 5/19/97 (b) ................... 9,000,000 8,934,600
Xerox Credit Corporation,
5.30%, 4/01/97 (b) ................... 9,000,000 9,000,000
-----------
116,687,515
-----------
Industrial Conglomerate (9.0%):
Cargrill Incorporated, 5.42%, 4/17/97 (b) .... 9,000,000 8,978,320
Emerson Electric, 5.24%, 4/14/97 (b) ......... 9,000,000 8,982,970
-----------
17,961,290
-----------
Manufacturing (4.5%):
Dupont, 5.21%, 4/09/97 (b) ................... 9,000,000 8,989,580
-----------
Total Commercial Paper (Cost: $143,638,385) .................. 143,638,385
-----------
U.S. Government Agency Securities (20.1%):
Federal Farm Credit Bank Notes (12.4%):
5.62%, 9/03/97 ............................... 25,000,000 24,970,159
-----------
Federal Home Loan Bank Notes (2.7%):
5.40%, 4/01/97 (b) ........................... 5,350,000 5,350,000
-----------
Federal National Mortgage Association Notes (5.0%):
5.42%, 12/16/97 ............................. 10,000,000 9,986,297
-----------
Total U.S. Government Agency Securities
(Cost $40,306,456) 40,306,456
-----------
Repurchase Agreements (0.0%):
State Street Bank & Trust Co., Master
Repurchase Agreement , 4.25%, dated
3/31/97 due 4/01/97, Collateralized
by U.S. Government Securities
(delivery value $29,797) ......................... 29,794 29,794
-----------
Total Repurchase Agreements (cost: $29,794) ................. 29,794
-----------
Total Investments In Securities
(cost: $201,236,422) (c) (100.5%) ............... 201,236,422
Other Assets Less Liabilities (-0.5%) ....................... (1,049,401)
-----------
Net Assets (100%) ........................................... $200,187,021
===========
</TABLE>
- ----------
Notes to Schedule of Investments
(a) Securities are valued in accordance with procedures described in note 1 to
the financial statements.
(b) Rate represents annualized yield to maturity at March 31, 1997.
(c) Cost is the same for federal income tax purposes.
See accompanying notes to financial statements.
- 3 -
<PAGE>
Schedule of Investments (Unaudited)
Griffin Tax-Free Money Market Fund
March 31, 1997
[PIE CHART APPEARS HERE]
Variable Rate Demand Notes 50%
Commercial Paper 6%
Pre-refunded Bonds 4%
General Obligations 15%
Notes/Bonds 25%
Investment Categories Reflect Percentages of Investments in Securities
<TABLE>
<CAPTION>
Principal Market
Name of Issuer Amount Value(a)
- --------------------------------------------------------------------------------------------------
(Percentage of each investment category relate to total net assets)
<S> <C> <C>
Municipal Short-Term Securities (97.2%):
Arizona (3.8%):
Scottsdale, Arizona Municipal
Property Municipal Facilities,
7.60%, Pre-refunded to 7/01/97 ....... $ 500,000 $ 514,879
-----------
California (5.9%):
California State Revenue Anticipation
Notes, 4.50%, 6/30/97 ................ 300,000 300,377
Sacramento County, California
Tax and Revenue Anticipation
Notes, 4.50%, 9/30/97 ................ 500,000 501,700
-----------
802,077
-----------
Delaware (7.1%):
Delaware State Economic Development
Authority Industrial Development Revenue,
Delaware City Waste Recovery,
Series A, 3.50%, 4/02/97 (b) ......... 500,000 500,000
Wilmington, Delaware General
Obligation, 5.00%, 10/01/97 .......... 465,000 468,175
-----------
968,175
-----------
Florida (2.9%):
Citrus Park Community Development,
District Florida, Capital Improvements,
3.50%, 4/02/97 (b) ................... 200,000 200,000
Florida Housing Finance Agency
Multi Family Monterey Meadow,
3.45%, 4/02/97 (b) ................... 200,000 200,000
-----------
400,000
-----------
Illinois (7.3%):
Chicago, Illinois O'Hare International
Airport, General Airport Second Lien,
Series A, 5.00%, 1/01/98 ............. 100,000 100,627
Chicago, Illinois O'Hare International
Airport, General Airport Second Lien,
Series B, 3.55%, 4/02/97 (b) ......... 100,000 100,000
Chicago, Illinois O'Hare International
Airport, General Airport Second Lien,
Series C, 3.50%, 4/02/97 (b) ......... 400,000 400,000
Illinois Health Facilities Authority
Revenue, SSM Health
Care Project A, 3.40%, 4/02/97 (b) ... 400,000 400,000
-----------
1,000,627
-----------
Indiana (2.2%):
Fort Wayne, Indiana Hospital
Authority, Parkview Memorial
Hospital, Series B, 3.40%, 4/02/97 (b) 200,000 200,000
Indianapolis, Indiana Multi-Family
Housing Revenue, Canal Square
Project, 3.50%, 4/02/97 (b) .......... 100,000 100,000
-----------
300,000
-----------
Kansas (8.1%):
Kansas City, Kansas Industrial
Revenue, Adjustable Rate-PQ
Corporation Project,
4.00%, 4/01/97 (b) ................... 600,000 600,000
Kansas State Department of Transportation
Highway Revenue, 3.35%, 4/02/97 (b) .. 500,000 500,000
-----------
1,100,000
-----------
Louisiana (8.1%):
Ascension Parish, Louisiana
Pollution Control Revenue, Shell Oil,
3.30%, 4/02/97 (b) ................... 500,000 500,000
East Baton Rouge Parish, Louisiana
Pollution Control Revenue,
Georgia-Pacific Corporation,
3.45%, 4/03/97 (b) ................... 100,000 100,000
South Louisiana Port Community
Marine Terminal Facilities
Revenue, 3.45%, 4/02/97 (b) .......... 500,000 500,000
-----------
1,100,000
-----------
Massachusetts (3.7%):
Massachusetts State General
Obligation, 4.25%, 6/10/97 ........... 500,000 500,393
-----------
Michigan (7.6%):
Big Rapids, Michigan Public
Schools District, 7.50%, 5/01/97 ..... 525,000 526,705
Michigan State Hospital Financing
Authority, 4.10%, 10/15/97 ........... 500,000 500,778
-----------
1,027,483
-----------
</TABLE>
See accompanying notes to financial statements.
- 4 -
<PAGE>
Schedule of Investments (Unaudited)
Griffin Tax-Free Money Market Fund (Continued)
March 31, 1997
<TABLE>
<CAPTION>
Principal Market
Name of Issuer Amount Value(a)
- --------------------------------------------------------------------------------------------------
(Percentage of each investment category relate to total net assets)
<S> <C> <C>
Missouri (1.5%):
Columbia Missouri Special Revenue,
Series A, 3.45%, 4/02/97 (b) ......... $ 200,000 $ 200,000
-----------
Montana (0.7%):
Billings, Montana Industrial
Development Revenue,
3.45%, 4/02/97 (b) ................... 100,000 100,000
-----------
Nebraska (2.9%):
Nebraska Higher Education Loan
Program, 3.55%, 4/02/97 (b) .......... 400,000 400,000
-----------
Nevada (2.9%):
Clark County, Nevada Airport
Improvement Revenue,
Series A-1, 3.35%, 4/02/97 (b) ....... 400,000 400,000
-----------
New Mexico (3.7%):
Albuquerque, New Mexico Gross
Receipts Lodgers Tax Revenue,
3.45%, 4/02/97 (b) ................... 500,000 500,000
-----------
North Carolina (2.9%):
North Carolina Eastern Municipal
Power Agency - Power System
Revenue, 3.30%, 4/07/97 .............. 300,000 300,000
North Carolina Educational Facilities
Finance Authority Bowman
Gray School, 3.50%, 4/02/97 (b) ...... 100,000 100,000
-----------
400,000
-----------
Ohio (6.7%):
Hamilton County, Ohio Sewer
System Revenue, 5.90%, 12/01/97 ...... 400,000 405,460
Ohio State General Obligation,
4.80%, 5/15/97 ....................... 500,000 500,703
-----------
906,163
-----------
Tennessee (2.9%):
Tennessee Housing Development
Agency, 3.85%, 5/29/97 ............... 400,000 400,000
-----------
Texas (3.7%):
Grapevine, Texas Industrial
Development Corporation, Multiple
Mode - American Airlines,
3.80%, 4/01/97 (b) ................... 100,000 100,000
Greater East Texas Higher Education,
3.85%, 5/01/97 ....................... 400,000 400,000
-----------
500,000
-----------
Utah (3.7%):
Intermountain Power Agency Utah
Power Supply Revenue,
3.55%, 5/09/97 ....................... $ 500,000 $ 500,000
-----------
Washington (5.7%):
Port Seattle Washington Revenue,
4.40%, 11/01/97 ...................... 275,000 276,086
Seattle, Washington Water System
Revenue, 3.45%, 4/02/97 (b) .......... 500,000 500,000
-----------
776,086
-----------
Wisconsin (3.2%):
Wisconsin State Health & Educational
Facilities Authority Revenue,
Meriter Hospital, 4.00%, 12/01/97 .... 430,000 429,708
-----------
Total Municipal Short-Term Securities
(cost: $13,225,591) .................................. 13,225,591
-----------
Other Short-Term Securities (0.2%):
Seven Seas Tax Free Money Market,
3.03%, 4/01/97 ....................... 32,145 32,145
-----------
Total Other Short-Term Securities
(cost: $32,145) ...................................... 32,145
-----------
Total Investments In Securities
(cost: $13,257,736) (c) (97.4%) ...................... 13,257,736
Other Assets Less Liabilities (2.6%) ......................... 354,763
-----------
Net Assets (100%) ............................................ $ 13,612,499
===========
</TABLE>
- ----------
Notes to Schedule of Investments
(a) Securities are valued in accordance with procedures described in note 1 to
the financial statements.
(b) These variable rate securities have maturities greater than one year but
are redeemable upon demand. For purposes of calculating the Fund's weighted
average maturity, the length to maturity of these investments is considered
to be the greater of the period until the interest rate is adjusted or
until the principal can be recovered by demand.
(c) Cost is the same for federal income tax purposes.
See accompanying notes to financial statements.
- 5 -
<PAGE>
Schedule of Investments (Unaudited)
Griffin Short-Term Bond Fund
March 31, 1997
[PIE CHART APPEARS HERE]
Corporate Bonds 17%
U.S. Treasury Notes 69%
U.S. Agency Securities 12%
Cash 2%
Investment Categories Reflect Percentages of Investments in Securities
<TABLE>
<CAPTION>
Principal Market
Name of Issuer Amount Value(a)
- --------------------------------------------------------------------------------------------------
(Percentage of each investment category relate to total net assets)
<S> <C> <C>
Corporate Bonds (16.6%):
Banking (2.5%):
Bankers Trust - New York, 9.50%, 6/14/00 ..... $ 90,000 $ 96,300
First Chicago, 9.00%, 6/15/99 ................ 30,000 31,388
MBNA Corporation
6.88%, 10/01/99 ...................... 210,000 209,475
7.49%, 9/14/99 ....................... 350,000 353,500
Northern Trust , 9.00%, 5/15/98 .............. 100,000 102,767
-----------
793,430
-----------
Financial Services (5.6%):
Associates Corporation, N.A
6.00%, 3/15/00 ....................... 250,000 244,063
6.75%, 10/15/99 ...................... 16,000 16,000
6.75%, 7/15/97 ....................... 37,000 37,081
Bear Stearns Company, 9.13%, 4/15/98 ......... 30,000 30,825
Ford Motor Credit Corporation,
9.38%, 12/15/97 ...................... 50,000 51,114
General Motors Acceptance Corporation
5.63%, 2/15/01 ....................... 200,000 190,250
8.38%, 5/01/97 ....................... 30,000 30,056
Golden West Financial, 10.25%, 12/01/00 ...... 255,000 280,181
Heller Financial, 9.13%, 8/01/99 ............. 100,000 104,750
Lehman Brothers Holdings Corporation,
8.88%, 11/01/98 ...................... 150,000 154,772
Paine Webber Group, 9.25%, 12/15/01 .......... 600,000 639,000
-----------
1,778,092
-----------
Industrial Conglomerate (3.6%):
Anheuser Busch Company,
8.75%, 12/01/99 ...................... 100,000 104,750
Cox Communication Incorporated - New,
8.55%, 6/01/00 ....................... 40,000 41,550
Cox Communications Incorporated,
6.38%, 6/15/00 ....................... 100,000 97,875
General Motors Acceptance Corporation,
6.88%, 7/15/01 ....................... 300,000 296,250
GTE Corporation, 9.38%, 12/01/00 ............. 100,000 107,000
International Paper Company,
9.70%, 3/15/00 ....................... $ 150,000 $ 160,688
Lockheed Corporation, 9.38%, 10/15/99 ........ 71,000 75,260
Pepsico Incorporated, 7.75%, 10/01/98 ........ 100,000 101,850
Sears Roebuck & Company,
7.32%, 3/20/98 ....................... 100,000 100,962
Texaco Capital Incorporated,
9.00%, 12/15/99 ...................... 65,000 68,494
-----------
1,154,679
-----------
Retailing (0.4%):
Wal-Mart Stores
5.50%, 9/15/97 ....................... 30,000 29,925
6.75%, 5/15/02 ....................... 100,000 98,750
-----------
128,675
-----------
Transportation (0.5%):
Southwest Airlines, 9.40%, 7/01/01 ........... 150,000 160,875
-----------
Utilities (4.0%):
Alabama Power Company, 6.38%, 8/01/99 ........ 30,000 29,775
Baltimore Gas & Electric, 8.93%, 7/16/98 ..... 100,000 102,875
Consolidated Natural Gas, 8.75%, 6/01/99 ..... 465,000 483,019
National Rural Utilities, 6.75%, 9/01/01 ..... 300,000 295,500
Orange & Rockland Utility,
9.38%, 3/15/00 ....................... 275,000 291,844
Southern California Edison,
8.25%, 2/01/00 ....................... 60,000 61,950
-----------
1,264,963
-----------
Total Corporate Bonds
(cost: $5,341,919) ................................... 5,280,714
-----------
U.S. Government And Agency Securities (78.0%):
U.S. Treasury Notes (66.2%):
4.75%, 8/31/98 ............................... 1,000,000 979,500
5.13%, 2/28/98 ............................... 1,200,000 1,190,136
5.13%, 11/30/98 .............................. 600,000 588,510
5.50%, 4/15/00 ............................... 1,600,000 1,552,608
5.50%, 12/31/00 .............................. 600,000 576,204
5.88%, 8/15/98 ............................... 1,400,000 1,392,146
5.88%, 11/15/99 .............................. 1,200,000 1,180,368
6.00%, 8/15/99 ............................... 1,750,000 1,729,368
6.38%, 1/15/99 ............................... 675,000 675,074
6.63%, 6/30/01 ............................... 350,000 348,394
6.88%, 3/31/00 ............................... 550,000 553,757
7.00%, 4/15/99 ............................... 1,100,000 1,111,330
7.50%, 10/31/99 .............................. 650,000 663,930
7.50%, 5/15/02 ............................... 1,750,000 1,804,723
7.75%, 12/31/99 .............................. 800,000 822,864
7.75%, 1/31/00 ............................... 1,950,000 2,006,804
8.25%, 7/15/98 ............................... 670,000 686,489
8.88%, 5/15/00 ............................... 150,000 159,510
</TABLE>
See accompanying notes to financial statements.
- 6 -
<PAGE>
Schedule of Investments (Unaudited)
Griffin Short-Term Bond Fund (Continued)
March 31, 1997
<TABLE>
<CAPTION>
Principal Market
Name of Issuer Amount Value(a)
- --------------------------------------------------------------------------------------------------
(Percentage of each investment category relate to total net assets)
<S> <C> <C>
9.13%, 5/15/99 ............................... $ 2,200,000 $ 2,313,338
9.25%, 8/15/98 ............................... 700,000 726,922
-----------
21,061,975
-----------
U.S. Agency Securities (11.8%):
Federal Home Loan Bank (1.2%):
5.89%, 7/24/00 ....................... 200,000 194,540
5.94%, 6/13/00 ....................... 200,000 194,988
-----------
389,528
-----------
Federal Home Loan Mortgage Association (8.3%):
5.50%, 5/01/01 ....................... 225,932 217,742
5.50%, 6/01/01 ....................... 248,674 239,660
6.00%, 4/01/99 ....................... 165,464 161,430
6.00%, 6/01/01 ....................... 476,293 464,681
6.00%, 6/01/01 ....................... 98,153 95,760
6.50%, 12/01/99 ...................... 403,499 396,309
6.50%, 5/01/01 ....................... 474,677 470,077
7.00%, 9/01/01 ....................... 546,252 546,077
7.75%, 11/07/01 ...................... 50,000 51,563
-----------
2,643,299
-----------
Federal National Mortgage Association (2.3%):
8.25%, 12/18/00 ...................... 225,000 235,060
9.05%, 4/10/00 ....................... 475,000 503,495
-----------
738,555
-----------
Total U.S. Government And Agency Securities
(cost: $25,097,750) .................................. 24,833,357
-----------
Short-Term Securities (1.9%):
Repurchase Agreements (1.9%):
State Street Bank & Trust Co. Master
Repurchase Agreement, 4.25%, dated
3/31/97 due 4/01/97, Collaterized
by U.S. Goverment Securities (delivery
value $613,452) ...................... $ 613,380 $ 613,380
-----------
Total Short-Term Securities (cost: $613,380) ................. 613,380
-----------
Total Investments In Securities
(cost: $31,053,047)(b)(96.5%) ........................ 30,727,451
Other Assets Less Liabilities (3.5%) ......................... 1,105,266
-----------
Net Assets (100%) ............................................ $31,832,717
===========
</TABLE>
- ----------
Notes to Schedule of Investments
(a) Securities are valued in accordance with procedures described in note 1 to
the financial statements.
(b) Cost is the same for federal income tax purposes. The aggregate gross
unrealized appreciation and depreciation of investments in securities based
on this cost as follows:
Gross unrealized appreciation $ 1,605
Gross unrealized depreciation (327,201)
---------
Net unrealized depreciation ($325,596)
=========
See accompanying notes to financial statements.
- 7 -
<PAGE>
Schedule of Investments (Unaudited)
Griffin U.S. Government Income Fund
March 31, 1997
[PIE CHART APPEARS HERE]
U.S. Treasury Notes 15%
Mortgage-Backed Securities 77%
U.S. Government Agency Securities 2%
U.S. Government Agency Notes 6%
Investment Categories Reflect Percentages of Investments in Securities
<TABLE>
<CAPTION>
Principal Market
Name of Issuer Amount Value(a)
- --------------------------------------------------------------------------------------------------
(Percentage of each investment category relate to total net assets)
<S> <C> <C>
Mortgage-Backed Securities (70.5%):
Government National Mortgage Association (61.2%):
7.00%, 8/15/23 - 3/15/27 ..................... $ 9,327,720 $ 8,907,550
7.50%, 3/15/24 - 2/15/27 ..................... 15,078,289 14,784,070
8.00%, 10/15/24 - 2/15/27 .................... 10,156,792 10,201,175
9.50%, 8/15/09 - 8/15/20 ..................... 2,644,27 2,840,145
11.00%, 2/15/10 - 10/15/18 ................... 256,518 285,616
12.50%, 12/15/10 - 6/15/15 ................... 85,777 99,421
13.00%, 8/15/12 .............................. 43,837 50,975
-----------
37,168,952
-----------
Federal Home Loan Mortgage Corporation (1.2%):
9.50%, 11/01/05 .............................. 159,110 166,866
9.50%, 12/01/04 .............................. 513,832 538,882
-----------
705,748
-----------
Federal National Mortgage Association (5.4%):
6.50%, 11/01/26 .............................. 2,000,000 1,854,360
10.00%, 7/01/21 .............................. 1,311,912 1,434,904
-----------
3,289,264
-----------
Collateralized Mortgage Obligations (2.7%):
L. F. Rothschild Mortgage Trust,
Series 3, Class Z, 9.95%, 9/01/17 .... 1,512,527 1,651,027
-----------
Total Mortgage-Backed Securities
(cost: $43,178,780) .................................. 42,814,991
-----------
U.S. Government And Agency Securities (15.8%):
U.S. Treasury Notes (14.1%):
5.88%, 7/31/97 ............................... 5,550,000 5,554,662
6.88%, 5/15/06 ............................... 3,000,000 2,984,730
-----------
8,539,392
-----------
Federal National Mortgage Association (1.7%):
8.10%, 8/12/19 ............................... $ 1,000,000 $ 1,068,840
-----------
Total U.S. Goverment And Agency Securities
(cost: $9,706,018) ................................... 9,608,232
-----------
Short-Term Securities (5.3%):
Federal Home Loan Bank (0.2%):
6.25%, 4/01/97 (b) ........................... 100,000 100,000
-----------
Federal Home Loan Mortgage Corporation (5.1%):
5.40%, 4/08/97 (b) ........................... 3,100,000 3,096,745
-----------
Total Short-Term Securities (cost: $3,196,745) ............... 3,196,745
-----------
Total Investments In Securities
(cost: $56,081,543)(c)(91.6%) ........................ 55,619,968
Other Assets Less Liabilities (8.4%) ......................... 5,083,860
-----------
Net Assets (100%) ............................................ $60,703,830
===========
</TABLE>
- ----------
Notes to Schedule of Investments
(a) Securities are valued in accordance with procedures described in note 1
to the financial statements.
(b) Rate represents annualized yield to maturity at March 31, 1997.
(c) Cost is the same for federal income tax purposes. The aggregate gross
unrealized appreciation and depreciation of investments in securities
based on this cost were as follows:
Gross unrealized appreciation $ 95,081
Gross unrealized depreciation (556,656)
--------
Net unrealized depreciation ($461,575)
========
See accompanying notes to financial statements.
- 8 -
<PAGE>
Schedule of Investments (Unaudited)
Griffin Bond Fund
March 31, 1997
[PIE CHART APPEARS HERE]
Corporate Bonds 69%
U.S. Agency Securities 16%
U.S. Treasury Notes & Bonds 14%
Other 1%
Investment Categories Reflect Percentages of Investments in Securities
<TABLE>
<CAPTION>
Principal Market
Name of Issuer Amount Value(a)
- --------------------------------------------------------------------------------------------------
(Percentage of each investment category relate to total net assets)
<S> <C> <C>
Asset Backed Securities (0.1%):
Corporate (0.1%):
General Motor Acceptance Corporation
Grantor Trust, 6.30%, 6/15/99 ........ $ 42,013 $ 42,129
-----------
Total Asset Backed Securities (cost $42,000): ................ 42,129
-----------
Corporate Bonds (67.4%):
Banking (11.6%):
Abbey National First Capital
Corporation, 8.20%, 10/15/04 (b) ..... 175,000 182,875
ANZ Banking Group, 7.55%, 9/15/06 ............ 230,000 230,288
Bankamerica Corporation, 7.50%, 10/15/02 ..... 150,000 151,688
Capital One Bank, 6.83%, 8/16/99 ............. 300,000 297,750
Chase Manhattan Bank
6.63%, 1/15/98 ....................... 130,000 130,478
7.13%, 3/01/05 ....................... 400,000 392,000
Doa Heng Bank, 7.75%, 1/24/07 (b) ............ 270,000 262,913
First National Bank of Boston,
7.38%, 9/15/06 ....................... 270,000 266,288
First Security Corporation, 6.88%, 11/15/06 .. 220,000 209,000
First Union Corporation, 9.45%, 8/15/01 ...... 246,000 266,603
Fleet Financial Group
6.00%, 10/26/98 ...................... 315,000 312,442
7.13%, 4/15/06 ....................... 335,000 324,531
Golden West Financial, 7.88%, 1/15/02 ........ 250,000 256,563
Malayan Banking Berhad-New York,
7.13%, 9/15/05 (b) ................... 100,000 96,625
Midland Bank PLC, 7.63%, 6/15/06 (b) ......... 400,000 401,000
NationsBank Corporation
5.38%, 4/15/00 ....................... 300,000 287,625
7.25%, 10/15/25 ...................... 275,000 254,031
Norwest Corporation, 7.70%, 11/15/97 ......... 200,000 201,920
-----------
4,524,620
-----------
Utilities (1.7%):
Florida Power & Light , 5.38%, 4/01/00 ....... 305,000 292,800
Ohio Edison, 8.75%, 2/15/98 .................. 225,000 229,219
Virginia Electric & Power, 8.88%, 6/01/99 .... 125,000 130,156
-----------
652,175
-----------
Financial Services (25.2%):
Aegon, 8.00%, 8/15/06 (b) .................... 314,000 321,850
American Telephone & Telegraph
Capital Corporation, 5.65%, 1/15/99 .. 390,000 382,200
Associates Corporation, N.A.,
6.63%, 5/15/01 ....................... $ 80,000 $ 78,500
6.75%, 7/15/01 ....................... 60,000 59,100
6.75%, 8/01/01 ....................... 55,000 54,175
Bear Stearns Company
6.50%, 6/15/00 ....................... 225,000 220,500
7.63%, 9/15/99 ....................... 250,000 254,063
BHP Finance U.S.A ............................
6.69%, 3/01/06 (b) ................... 204,000 193,545
7.00%, 12/01/97 (b) .................. 200,000 201,000
7.88%, 12/01/02 (b) .................. 205,000 211,150
CIT Group Holdings, 8.75%, 4/15/98 ........... 110,000 112,683
Commercial Credit, 5.70%, 3/01/98 ............ 175,000 174,116
Countrywide Funding Corporation,
8.25%, 7/15/02 ....................... 166,000 172,018
Donaldson Lufkin & Jenrette,
6.88%, 11/01/05 ...................... 294,000 278,933
Ford Motor Credit Corp. ......................
Ford - Global Bond, 6.25%, 2/26/98 ... 350,000 350,179
6.85%, 8/15/00 ....................... 250,000 248,750
7.40%, 11/01/46 ...................... 80,000 74,800
8.20%, 2/15/02 ....................... 500,000 518,750
General Motors Acceptance Corporation
6.63%, 9/19/02 ....................... 455,000 443,056
6.88%, 7/15/01 ....................... 215,000 212,313
9.63%, 5/15/00 ....................... 100,000 107,125
Lehman Brothers Incorporated
6.65%, 7/14/98 ....................... 225,000 225,239
6.13%, 2/01/01 ....................... 550,000 527,313
Lincoln National Corporation,
7.25%, 5/15/05 ....................... 450,000 439,313
Merrill Lynch & Company Incorporated
6.00%, 1/15/01 ....................... 150,000 144,188
6.25%, 1/15/06 ....................... 230,000 212,750
7.38%, 8/17/02 ....................... 200,000 201,250
Morgan J.P. & Company
7.63%, 11/15/98 ...................... 250,000 254,145
7.63%, 9/15/04 ....................... 250,000 253,125
Morgan Stanley Group, 8.88%, 10/15/01 ........ 300,000 319,875
Paine Webber Group
7.31%, 8/09/00 ....................... 110,000 110,275
7.63%, 10/15/08 ...................... 40,000 39,650
7.81%, 2/13/17 ....................... 165,000 158,194
8.06%, 1/17/17 ....................... 255,000 252,450
8.25%, 5/01/02 ....................... 200,000 206,750
Sanwa Business Credit, 7.25%, 9/15/01 (b) .... 270,000 270,000
Smith Barney Holdings Incorporated,
7.13%, 10/01/06 ...................... 345,000 333,356
Travelers Property Casualty Corp. ............
6.75%, 11/15/06 ...................... 230,000 217,638
6.75%, 4/15/01 ....................... 500,000 492,500
US Leasing International, 8.75%, 12/01/01 .... 505,000 534,669
-----------
9,861,486
-----------
Government National (1.0%):
Quebec Province, 7.13%, 2/09/24 (b) .......... 115,000 104,219
Republic of Colombia, 7.63%, 2/15/07 (b) ..... 145,000 136,663
Republic of Indonesia, 7.75%, 8/01/06 (b) .... 165,000 163,969
-----------
404,851
-----------
Industrial Conglomerate (25.4%):
ADT Operations, 8.25%, 8/01/00 ............... 350,000 361,375
American Brands, 7.50%, 5/15/99 .............. 120,000 121,800
</TABLE>
See accompanying notes to financial statements.
- 9 -
<PAGE>
Schedule of Investments (Unaudited)
Griffin Bond Fund (Continued)
March 31, 1997
<TABLE>
<CAPTION>
Principal Market
Name of Issuer Amount Value(a)
- --------------------------------------------------------------------------------------------------
(Percentage of each investment category relate to total net assets)
<S> <C> <C>
Black & Decker
7.00%, 2/01/06 ....................... $ 50,000 $ 47,938
7.50%, 4/01/03 ....................... 185,000 186,156
Cardinal Health, 6.00%, 1/15/06 .............. 297,000 269,156
Coastal Corporation, 8.13%, 9/15/02 .......... 165,000 170,981
Coca Cola Company, 7.88%, 9/15/98 ............ 200,000 203,926
Columbia/HCA Healthcare
6.91%, 6/15/05 ....................... 300,000 291,000
7.15%, 3/30/04 ....................... 250,000 246,875
ConAgra Incorporated, 7.13%, 10/01/26 ........ 240,000 234,600
CPC International Incorporated,
6.15%, 1/15/06 ....................... 350,000 323,750
CSR America Incorporated, 6.88%, 7/21/05 (b) . 300,000 287,625
General Motors Corporation,
9.63%, 12/01/00 ...................... 350,000 378,438
GTE Corporation, 8.85%, 3/01/98 .............. 500,000 510,705
GTE South, 6.00%, 2/15/08 .................... 250,000 223,125
Hanson Overseas BV, 6.75%, 9/15/05 (b) ....... 250,000 237,813
Honeywell Incorporated, 6.60%, 4/15/01 ....... 350,000 343,438
International Business Machines
Corporation, 6.38%, 6/15/00 .......... 200,000 197,000
International Paper Company, 9.70%, 3/15/00 .. 160,000 171,400
Lockheed Martin Corporation
7.25%, 5/15/06 ....................... 110,000 108,488
7.75%, 5/01/26 ....................... 235,000 231,769
MFS Communications, 8.34%, 1/15/04 ........... 355,000 319,500
News America Holdings
7.50%, 3/01/00 (b) ................... 350,000 353,063
8.63%, 2/01/03 (b) ................... 350,000 371,000
9.13%, 10/15/99 (b) .................. 65,000 68,331
Norcen Energy Resources, 7.38%, 5/15/06 (b) .. 120,000 117,450
Pepsico Incorporated, 7.75%, 10/01/98 ........ 300,000 305,550
Petroliam Nasional Berhad,
7.63%, 10/15/26 (b) .................. 300,000 291,000
Rite Aid, 6.70%, 12/15/01 .................... 485,000 474,088
Sears Roebuck & Company
5.60%, 11/16/98 ...................... 135,000 133,290
5.71%, 2/06/01 ....................... 65,000 61,831
9.25%, 4/15/98 ....................... 165,000 169,638
9.35%, 7/06/98 ....................... 100,000 103,456
9.38%, 4/08/98 ....................... 300,000 308,784
Tennessee Gas Pipeline, 7.00%, 3/15/27 ....... 170,000 164,900
Wal-Mart Stores, 8.63%, 4/01/01 .............. 350,000 368,813
Wharf Capital International,
8.88%, 11/01/04 (b) .................. 130,000 136,013
WMX Technology Incorporated
6.00%, 11/02/98 ...................... 100,000 99,209
7.70%, 10/01/02 ...................... 330,000 335,775
8.25%, 11/15/99 ...................... 200,000 207,000
Worldcom Incorporated, 7.55%, 4/01/04 ........ 385,000 381,631
-----------
9,917,680
-----------
Transportation (2.5%):
Burlington Northern, 6.96%, 3/22/09 .......... 134,996 131,871
Federal Express, 10.00%, 9/01/98 ............. 175,000 182,751
Southwest Airlines, 7.88%, 9/01/07 ........... 200,000 203,750
Union Pacific Corporation
6.70%, 12/01/06 ...................... 225,000 210,656
7.38%, 5/15/01 ....................... 250,000 250,000
-----------
979,028
-----------
Total Corporate Bonds
(cost: $26,829,835) .................................. 26,339,840
-----------
U.S. Government And Agency Securities (29.4%):
U.S. Government Securities (15.9%):
U.S. Treasury Bonds (9.8%):
7.25%, 8/15/22 ....................... $ 3,832,000 $ 3,842,423
-----------
U.S. Treasury Notes (6.1%):
5.50%, 11/15/98 ...................... 1,580,000 1,558,979
5.88%, 11/15/99 ...................... 60,000 59,018
6.38%, 8/15/02 ....................... 42,000 41,250
6.50%, 10/15/06 ...................... 748,000 724,819
-----------
2,384,066
-----------
U.S. Agency Securities (13.5%):
Federal National Mortgage Association (6.5%):
6.00%, 3/01/04 ....................... 383,910 367,713
6.86%, 6/17/11 ....................... 150,000 145,453
7.00%, 8/01/03 - 11/01/26 ............ 745,303 716,827
7.50%, 9/01/11 ....................... 95,100 95,219
7.54%, 6/01/16 ....................... 323,496 325,922
8.00%, 10/01/25 - 9/01/26 ............ 878,747 882,315
-----------
2,533,449
-----------
Government National Mortgage Association (7.0%):
7.00%, 11/15/23 - 6/20/26 ............ 556,723 530,066
7.50%, 12/15/23 - 1/20/27 ............ 964,938 946,299
8.00%, 7/15/17 ....................... 369,718 372,720
8.50%, 12/15/21 ...................... 316,825 326,130
9.00%, 12/15/21 - 3/01/27 ............ 514,401 541,686
-----------
2,716,901
-----------
Total U.S. Government And Agency Securities
(cost: $11,685,078) .................................. 11,476,839
-----------
Short-Term Securities (1.2%):
Repurchase Agreement (1.2%):
State Street Bank & Trust Co. ................
Master Repurchase Agreement, 4.25%,
dated 3/31/97 due 4/01/97,
Collaterized by U.S. Government
Securities (delivery value $484,485) . 484,428 484,428
-----------
Total Short-Term Securities (cost: $484,428) ................. 484,428
-----------
Total Investments In Securities
(cost: $39,041,341)(c)(98.1%) ........................ 38,343,236 38,343,236
Other Assets Less Liabilities (1.9%) ......................... 750,399
-----------
Net Assets (100%) ............................................ $ 39,093,635
===========
</TABLE>
- ----------
Notes to Schedule of Investments
(a) Securities are valued in accordance with procedures described in note 1 to
the financial statements.
(b) U.S. dollar denominated securities issued by foreign corporations and/or
governments.
(c) Cost is the same for federal income tax purposes. The aggregate gross
unrealized appreciation and depreciation of investments in securities based
on this cost were as follows:
Gross unrealized appreciation $26,305
Gross unrealized depreciation (724,410)
--------
Net unrealized depreciation ($698,105)
=========
See accompanying notes to financial statements.
- 10 -
<PAGE>
Schedule of Investments (Unaudited)
Griffin Municipal Bond Fund
March 31, 1997
[PIE CHART APPEARS HERE]
General Obligations 32%
Transportation 10%
Water 10%
Electric 7%
Sewer 8%
Lease 5%
Sales Tax 4%
Health Care 8%
Housing 8%
Other 8%
Investment Categories Reflect Percentages of Investments in Securities
<TABLE>
<CAPTION>
Principal Market
Name of Issuer Amount Value(a)
- --------------------------------------------------------------------------------------------------
(Percentage of each investment category relate to total net assets)
<S> <C> <C>
Municipal Long-Term Securities (98.1%):
Arizona (6.6%):
Arizona State University Revenue
System, 7.00%, Pre-refunded
to 7/01/02 ........................... $ 250,000 $ 277,500
Phoenix, Arizona, Series A,
6.25%, 7/01/17 ....................... 200,000 213,750
-----------
491,250
-----------
California (3.2%):
California State Department of Water Resources
5.00%, 12/01/22 ...................... 100,000 87,750
6.00%, 12/01/06 ...................... 140,000 149,800
-----------
237,550
-----------
Colorado (1.8%):
Arapahoe County, Colorado Capital
Improvement Trust Fund
Highway Revenue, 6.90%, 8/31/15 ...... 125,000 131,719
-----------
Florida (4.8%):
Dade County, Florida Aviation
Revenue, 5.50%, 10/01/07 ............. 200,000 202,750
Florida State Board of Education,
Capital Outlay Public Education,
5.75%, 6/01/15 ....................... 150,000 150,000
-----------
352,750
-----------
Georgia (2.4%):
Georgia State General Obligation,
7.20%, 3/01/08 ....................... 150,000 174,938
-----------
Idaho (2.7%):
Idaho Housing & Finance Association,
Single Family Mortgage,
5.20%, 7/01/27 ....................... 200,000 198,750
-----------
Illinois (7.7%):
Du Page County, Illinois General
Obligation Revenue Bond,
Stormwater Project, 5.60%, 1/01/21 ... $ 250,000 $ 241,250
Metropolitan Pier & Exposition
Authority Dedicated State Tax
Revenue Bond, 4.92%, 6/15/01 (b) ..... 400,000 326,000
-----------
567,250
-----------
Indiana (1.4%):
Wa-Nee Elementary/High School
Building Corporation,
Revenue Bond, 6.50%, 7/15/10 ......... 100,000 105,500
-----------
Massachusetts (4.1%):
Massachusetts Bay Transportation
Authority General Transportation
System, 5.60%, 3/01/08 ............... 200,000 204,500
Massachusetts State Water Resources
Authority, 6.00%, 8/01/14 ............ 100,000 102,000
-----------
306,500
-----------
Michigan (1.0%):
Michigan State Hospital Financing Authority
Metropolitan Hospital, 5.88%, 7/01/14 75,000 71,344
-----------
Minnesota (2.7%):
University of Minnesota, Series A,
Revenue Bond, 4.75%, 7/01/03 ......... 200,000 196,750
-----------
Nevada (1.4%):
Nevada State General Obligation,
5.80%, 7/15/08 ....................... 100,000 103,375
-----------
New Jersey (2.9%):
New Jersey State General Obligation,
6.00%, 2/15/11 ....................... 200,000 212,000
-----------
New York (6.9%):
New York State Dormitory Authority
Revenues, Mental Health Services
Facilities, Series A, 5.00%, 2/15/00 . 200,000 199,750
New York State Environmental
Facilities Corporation Pollution
Control Revenue Revolving
Fund, 6.80%, 6/15/01 ................. 100,000 107,875
New York, New York General
Obligation, 6.00%, 2/01/04 ........... 200,000 205,000
-----------
512,625
-----------
Ohio (6.9%):
Franklin County, Ohio Hospital
Revenue, Holy Cross Health
Systems Corporation, 5.50%, 6/01/01 300,000 307,125
Ohio State Water Department
Authority Revenue Fresh Water
Series, Revenue Bond, 5.70%, 6/01/09 200,000 205,250
-----------
512,375
-----------
</TABLE>
See accompanying notes to financial statements.
- 11 -
<PAGE>
Schedule of Investments (Unaudited)
Griffin Municipal Bond Fund (Continued)
March 31, 1997
<TABLE>
<CAPTION>
Principal Market
Name of Issuer Amount Value(a)
- --------------------------------------------------------------------------------------------------
(Percentage of each investment category relate to total net assets)
<S> <C> <C>
Oregon (1.5%):
Oregon State Department of Transportation
Revenue, Regional Light Rail Fund -
Westside Project, 6.25%, 6/01/09 ..... $ 100,000 $ 107,375
-----------
Pennsylvania (7.5%):
Commonwealth of Pennsylvania
General Obligation, 5.20%, 6/15/04 ... 250,000 252,500
Pennsylvania Housing Finance Agency,
Single Family Mortgage,
4.60%, 10/01/98 .............. 300,000 301,875
-----------
554,375
-----------
Puerto Rico (2.9%):
Puerto Rico Electric Power Authority,
Electric Revenue, 6.13%, 7/01/08 .... 200,000 212,250
-----------
South Carolina (2.7%):
Columbia, South Carolina Water
Works & Sewer Systems Revenue,
5.38%, 2/01/12 ....................... 200,000 196,750
-----------
South Dakota (1.4%):
South Dakota Housing Development
Authority, Homeownership
Mortgage, 6.65%, 5/01/14 ............. 100,000 104,625
-----------
Texas (9.6%):
Austin, Texas General Obligation,
5.70%, 9/01/07 ....................... 200,000 207,000
Harris County, Texas Tax and
Revenue Certificate of Obligation,
6.00%, 12/15/10 ...................... 200,000 211,500
San Antonio, Texas Electric &
Gas Revenue, 5.00%, 2/01/14 .......... 100,000 91,375
Texas Municipal Power Agency
Revenue, 5.25%, 9/01/08 .............. 200,000 199,500
-----------
709,375
-----------
Virginia (4.8%):
Virginia State Public Building
Authority Revenue, 5.20%, 8/01/16 .... 250,000 232,185
Virginia State Transportation
Board Revenue, North Virginia
Transportation District Program,
6.25%, 5/15/12 ....................... 120,000 125,400
-----------
357,585
-----------
Washington (5.9%):
Seattle, Washington Water System
Revenue, 5.25%, 12/01/23 ............. 250,000 227,188
Washington State General Obligation,
5.75%, 9/01/09 ....................... 200,000 207,750
-----------
434,938
-----------
Wisconsin (5.3%):
Wisconsin State General Obligation,
5.13%, 11/01/07 (c) .................. $ 200,000 $ 199,000
Wisconsin State Transportation,
5.50%, 7/01/14 ....................... 200,000 194,250
-----------
393,250
-----------
Total Municipal Long-Term Securities
(cost: $7,195,479) ................................... 7,245,199
-----------
Municipal Short-Term Securities (2.7%):
Tennessee (2.7%):
Metropolitan, Nashville Airport
Authority Special Facilities Revenue,
American Airlines, 3.80%, 4/01/97 (d) 200,000 200,000
-----------
Total Municipal Short-Term Securities
(cost: $200,000) ..................................... 200,000
-----------
Other Short-Term Securities (0.5%):
Seven Seas Tax Free Money Market,
3.03%, 4/01/97 ....................... 33,859 33,859
-----------
Total Other Short-Term Securities
(cost: $33,859) ...................................... 33,859
-----------
Total Investments In Securities (cost: $7,429,338)(e)
(101.3%) ............................................. 7,479,058
Other Assets Less Liabilities (-1.3%) ........................ (93,397)
-----------
Net Assets (100%) ............................................ $ 7,386,661
===========
</TABLE>
Short Futures Contracts
Number of Notional Unrealized
Contracts Description Contract Value Appr.(Depr.)
- --------------------------------------------------------------------------------
1 U.S. Treasury Long Bond, June 1997 ($108,688) $1,469
- ----------
Notes to Schedule of Investments
(a) Securities are valued in accordance with procedures described in note 1 to
the financial statements.
(b) Rate on these zero coupon bonds represents annualized yield to maturity at
March 31, 1997.
(c) These securities were placed in a segregated account with the custodian in
connection with futures contracts.
(d) These variable rate securities have maturities greater than one year but
are redeemable upon demand. For purposes of calculating the Fund's weighted
average maturity, the length to maturity of these investments is considered
to be the greater of the period until the interest rate is adjusted or
until the principal can be recovered by demand.
(e) Cost is the same for federal income tax purposes. The aggregate gross
unrealized appreciation and depreciation of investments in securities based
on this cost as follows:
Gross unrealized appreciation $101,016
Gross unrealized depreciation (49,827)
-------
Net unrealized appreciation $51,189
=======
See accompanying notes to financial statements.
- 12 -
<PAGE>
Schedule of Investments (Unaudited)
Griffin California Tax-Free Fund
March 31, 1997
[PIE CHART APPEARS HERE]
General Obligations 30%
Sales Tax 8%
Housing 9%
Water 12%
Airport 7%
Transportation 7%
Public Improvements 5%
Education 6%
Electric 7%
Sewer 7%
Other 2%
Investment Categories Reflect Percentages of Investments in Securities
<TABLE>
<CAPTION>
Principal Market
Name of Issuer Amount Value(a)
- --------------------------------------------------------------------------------------------------
(Percentage of each investment category relate to total net assets)
<S> <C> <C>
Municipal Long-Term Securities (95.5%):
Airport Revenue (6.7%):
Los Angeles, California Department of
Airports, 5.50%, 5/15/08 ............. $ 1,000,000 $ 1,013,750
San Francisco, California City &
County Airports, Second Series
Issue 12-B, 5.50%, 5/01/09 ........... 705,000 712,050
-----------
1,725,800
-----------
Electric Revenue (6.5%):
Northern California Transmission
Revenue Bond, Series A,
5.25%, 5/01/20 ....................... 1,000,000 906,250
Puerto Rico Electric Power Authority
Power Revenue, Series U,
6.00%, 7/01/14 ....................... 750,000 761,250
-----------
1,667,500
-----------
General Obligations (29.2%):
Folsom, California School Facilities
Project - Series B, 6.00%, 8/01/10 ... 300,000 312,750
Palo Alto, California Unified
School District, 5.25%, 8/01/03 ...... 500,000 510,625
Puerto Rico Commonwealth,
5.65%, 7/01/15 ....................... 800,000 808,000
State of California
5.50%, 4/01/13 ....................... 2,000,000 1,982,500
6.00%, 8/01/10 ....................... 550,000 575,438
6.10%, 9/01/04 ....................... 1,000,000 1,072,500
6.60%, 2/01/10 ....................... 1,000,000 1,106,250
6.70%, 2/01/04 ....................... 1,000,000 1,102,500
-----------
7,470,563
-----------
Hospital Revenue (1.1%):
California Health Facilities
Financing Authority Revenue,
Kaiser Permanente, Series C,
5.60%, 5/01/33 ....................... 300,000 279,375
-----------
Housing Revenue (8.3%):
California Housing Finance Agency
Revenue, Home Mortgage,
Series B, 5.20%, 8/01/26 ............. $ 500,000 $ 499,375
California Housing Finance Agency
Revenue, Home Mortgage,
Series F-1, 6.50%, 2/01/08 ........... 1,060,000 1,115,650
California Housing Finance Agency
Revenue, Multi-Unit Rental
Housing, 6.88%, 8/01/24 .............. 500,000 516,875
-----------
2,131,900
-----------
Public Improvements (5.0%):
Sacramento, California Certificates
of Participation, Public
Facilities Project, 6.00%, 7/01/12 ... 750,000 765,000
Santa Barbara County, California
Certificate of Participation,
6.40%, 2/01/11 ....................... 500,000 518,750
-----------
1,283,750
-----------
Sales Tax Revenue (7.8%):
Contra Costa, California Transportation
Authority Sales Tax Revenue Bond,
5.50%, 3/01/01 ....................... 500,000 515,625
San Diego County, California
Regional Transportation Commission
Sales Tax Revenue, Series A,
4.75%, 4/01/08 ....................... 765,000 732,488
San Francisco, California Bay
Area Rapid Transit District
Sales Tax Revenue, 5.35%, 7/01/07 .... 500,000 505,000
San Jose, California Redevelopment
Agency Tax Allocation, 5.38%, 8/01/11 250,000 246,563
1,999,676
-----------
Sewer Revenue (7.1%):
San Francisco, California City &
County Sewer Revenue
5.90%, 10/01/08 ...................... 600,000 623,250
6.50%, 10/01/12 ...................... 500,000 534,375
San Jose-Santa Clara, California
Water Authority Sewer Revenue
Bond, Series A, 5.38%, 11/15/20 ...... 700,000 652,750
-----------
1,810,375
-----------
Transportation Revenue (6.4%):
Long Beach, California Harbor
Revenue Bond, 5.25%, 5/15/25 ......... 1,000,000 891,250
Los Angeles, California Harbor
Department Revenue Bond,
5.38%, 11/01/23 ...................... 250,000 227,185
</TABLE>
See accompanying notes to financial statements.
- 13 -
<PAGE>
Schedule of Investments (Unaudited)
Griffin California Tax-Free Fund (Continued)
March 31, 1997
<TABLE>
<CAPTION>
Principal Market
Name of Issuer Amount Value(a)
- --------------------------------------------------------------------------------------------------
(Percentage of each investment category relate to total net assets)
<S> <C> <C>
Riverside County, California
Transportation Community Sales
Tax Revenue, Series A, 5.75%, 6/01/08 $ 500,000 $ 524,375
-----------
1,642,810
-----------
University/Education Revenue (5.5%):
California Educational Facilities
Authority Revenue Bond, Pooled
College & University Project,
Series A, 5.15%, 12/01/04 ............ 500,000 499,375
California Educational Facilities
Authority Revenue Bond,
Santa Clara University,
4.50%, 9/01/02 ....................... 250,000 247,188
4.80%, 9/01/05 ....................... 250,000 247,188
University of California Certificate of
Participation, UCLA Center
Chiller/Cogeneration Project,
6.00%, 11/01/21 ...................... 400,000 401,500
-----------
1,395,251
-----------
Water Revenue (11.9%):
California State Department of Water Resources
5.00%, 12/01/22 ...................... 300,000 263,250
6.00%, 12/01/06 ...................... 500,000 535,000
6.00%, 12/01/09 ...................... 500,000 535,000
Los Angeles, California Department of
Water & Power, Water Works
Revenue, 6.20%, 7/01/12 .............. 600,000 630,000
Metropolitan Water District of Southern California
5.00%, 7/01/10 ....................... 200,000 191,750
5.75%, 7/01/09 ....................... 750,000 788,437
6.00%, 7/01/07 ....................... 100,000 106,750
-----------
3,050,187
-----------
Total Municipal Long-Term Securities
(cost: $24,224,999) .................................. 24,457,187
-----------
Municipal Short-Term Securities (2.0%):
Housing Revenue (0.4%):
Burbank California Redevelopment
Agency - Multi-Family Revenue,
3.10%, 4/02/97 (b) ................... 100,000 100,000
-----------
Industrial Development Revenue - Pollution Control (0 4%):
California Pollution Control
Financing, Shell Oil Company
Project , 3.65%, 4/03/97 (b) ......... 100,000 100,000
-----------
Public Improvements (1.2%):
Duarte, California Redevelopment
Agency Certificates of Participation,
Johnson Duarte Partners,
3.30%, 4/03/97 (b) ................... 100,000 100,000
Duarte, California Redevelopment
Agency Certificates of Participation,
Piken Duarte Partners,
3.30%, 4/03/97 (b) ........... $ 100,000 $ 100,000
San Bernardino County, California
Certificate of Participation, County
Center Refinancing Project,
3.30%, 4/02/97 (b) ................... 100,000 100,000
-----------
300,000
-----------
Total Municipal Short-Term Securities
(cost: $500,000) ..................................... 500,000
-----------
Total Investments In Securities
(cost: $24,724,999) (c) (97.5%) ..................... 24,957,187
Other Assets Less Liabilities (2.5%) ......................... 661,269
-----------
Net Assets (100%) ............................................ $ 25,618,456
===========
</TABLE>
- ----------
Notes to Schedule of Investments
(a) Securities are valued in accordance with procedures described in note 1 to
the financial statements.
(b) These variable rate securities have maturities greater than one year but
are redeemable upon demand. For purposes of calculating the Fund's weighted
average maturity, the length to maturity of these investments is considered
to be the greater of the period until the interest rate is adjusted or
until the principal can be recovered by demand.
(c) Cost is the same for federal income tax purposes. The aggregate gross
unreal- ized appreciation and depreciation of investments in securities
based on this cost were as follows:
Gross unrealized appreciation $424,621
Gross unrealized depreciation (192,433)
--------
Net unrealized appreciation $232,188
========
See accompanying notes to financial statements.
- 14 -
<PAGE>
Schedule of Investments (Unaudited)
Griffin Growth & Income Fund
March 31, 1997
[PIE CHART APPEARS HERE]
Consumer Durable 4%
Capital Goods 7%
Consumer/ Non-Durable 14%
Consumer Services 17%
Energy 8%
Financial Services 18%
Health Care 6%
Consumer Durable 5%
Utilities 7%
Cash 6%
Other 8%
Investment Categories Reflect Percentages of Investments in Securities
<TABLE>
<CAPTION>
Number of Market
Name of Issuer Shares Value(a)
- --------------------------------------------------------------------------------------------------
(Percentage of each investment category relate to total net assets)
<S> <C> <C>
Common Stocks (94.8%):
Basic Industries (4.4%):
Bethlehem Steel Corp. (b) .................... 57,900 $ 477,675
Hanson PLC ................................... 14,012 318,773
IMC Global Inc. .............................. 24,000 867,000
James River Corp. ............................ 72,000 2,097,000
Louisiana Pacific Corp. ...................... 28,000 581,000
Reynolds Metals Co. .......................... 25,700 1,593,400
Tenneco Incorporated ......................... 39,500 1,540,500
-----------
7,475,348
-----------
Capital Goods (7.3%):
Alcatel Alsthom ADR .......................... 125,000 2,968,750
General Instrument (b) ....................... 104,400 2,388,150
Ingersoll-Rand ............................... 18,000 785,250
Litton Industries Inc. (b) ................... 24,800 998,200
Lockheed Martin Corp. ........................ 20,000 1,680,000
Newport News Shipbuilding .................... 5,600 81,200
Nokia Corp. ADR .............................. 21,100 1,229,075
Raytheon Co. ................................. 48,700 2,197,588
-----------
-----------
-----------
12,328,213
-----------
Consumer/ Durable (5.1%):
American Standard Companies (b) .............. 29,500 1,327,500
Black & Decker Corp. ......................... 26,000 835,250
Cooper Tire & Rubber ......................... 42,000 777,000
Energy Group PLC (b) ......................... 15,012 482,261
Maytag Corp. ................................. 58,500 1,206,563
Phillips Electronics N.V. ADR ................ 89,600 3,987,200
8,615,774
Consumer/ Non-Durable (13.9%):
Archer Daniels Midland ....................... 119,900 2,143,213
Dole Food Company ............................ 38,400 1,449,600
Fruit of the Loom Inc. (b) ................... 27,900 1,157,850
Harcourt General ............................. 37,000 1,720,500
Hasbro Inc. .................................. 56,100 1,535,738
Imperial Chemical Industries PLC ............. 29,000 1,319,500
Loews Corp. .................................. 18,300 1,626,413
Mattel Inc. .................................. 35,000 $ 840,000
McGraw-Hill Companies Inc .................... 28,400 1,451,950
Philip Morris Companies Inc. ................. 20,900 2,385,213
Polaroid Corp. ............................... 59,100 2,349,225
RJR Nabisco Holdings Corp. ................... 135,700 4,376,325
Rubbermaid Inc. .............................. 52,000 1,293,500
-----------
23,649,027
-----------
Consumer Services (18.3%):
ACNielsen Corporation (b) .................... 61,966 929,490
Browning-Ferris .............................. 48,700 1,406,213
Cognizant Corporation ........................ 32,600 949,475
Darden Restaurants ........................... 75,300 592,988
Deluxe Corp. ................................. 49,400 1,599,325
Dillards Department Stores ................... 20,500 645,750
Dun & Bradstreet Corp. ....................... 37,400 949,025
General RE Corporation ....................... 4,900 774,200
H & R Block Inc. ............................. 69,900 2,053,313
ITT Corp. (b) ................................ 51,300 3,020,288
Knight Ridder ................................ 39,600 1,579,050
New York Times Class A ....................... 35,000 1,544,375
News Corporation, Ltd. ADR ................... 29,000 522,000
Pittston Brink's Group ....................... 26,700 674,175
Prudential Reinsurance Holdings .............. 51,800 1,521,625
Rite Aid Corp. ............................... 42,600 1,789,200
Tandy Corp. .................................. 16,800 842,100
Toys R Us Holdings (b) ....................... 82,400 2,307,200
Viacom Inc - Class B (b) ..................... 58,400 1,934,500
Waban Incorporated (b) ....................... 24,000 669,000
Whitman Corporation .......................... 38,000 931,000
Woolworth (b) ................................ 169,900 3,971,413
-----------
31,205,705
-----------
Energy (7.4%):
British Petroleum ADR ........................ 8,800 1,207,800
Coastal Corp. ................................ 14,000 672,000
Dresser Industries Inc. ...................... 30,900 934,725
ELF Aquitaine ADR ............................ 33,000 1,625,250
Exxon Corp. .................................. 12,600 1,357,650
Great Lakes Chemical ......................... 19,000 874,000
Mobil Corp. .................................. 14,900 1,946,313
Occidental Petroleum ......................... 35,000 861,875
Oryx Energy (b) .............................. 71,000 1,366,750
Tosco Corp. .................................. 62,000 1,767,000
-----------
12,613,363
-----------
Financial Services (18.6%):
Aetna Inc. ................................... 49,000 4,207,875
Allmerica Financial Corp. .................... 17,500 614,688
Allstate Corp. ............................... 31,600 1,876,250
American Express Co. ......................... 20,100 1,203,488
American International Group Inc. ............ 2,350 275,831
Bancorp Hawaii Inc. .......................... 14,500 621,688
Bank of Boston Corp. ......................... 25,680 1,720,560
BankAmerica Corp. ............................ 23,400 2,357,550
</TABLE>
See accompanying notes to financial statements.
- 15 -
<PAGE>
Schedule of Investments (Unaudited)
Griffin Growth & Income Fund (Continued)
March 31, 1997
<TABLE>
<CAPTION>
Number of Market
Name of Issuer Shares Value(a)
- --------------------------------------------------------------------------------------------------
(Percentage of each investment category relate to total net assets)
<S> <C> <C>
Chubb Corporation ............................ 7,300 $ 393,288
CIGNA Corp. .................................. 21,100 3,083,238
Dean Witter/Discover ......................... 47,800 1,667,025
Equitable Companies .......................... 61,600 1,678,600
Great Western Financial Corp. ................ 83,700 3,379,377
ITT Hartford Group ........................... 17,200 1,240,550
Morgan, J.P. & Company Inc ................... 8,000 786,000
NationsBank Corp. ............................ 31,300 1,733,238
Republic New York Corp. ...................... 12,600 1,110,375
SAFECO Corp. ................................. 43,000 1,720,000
Washington Mutual Inc. ....................... 41,700 2,014,631
-----------
31,684,252
-----------
Health Care (5.6%):
Baxter International Inc. .................... 31,600 1,362,750
Bristol-Myers Squibb ......................... 19,100 1,126,900
Foundation Health (b) ........................ 25,500 930,750
Novartis AG ADR (b) .......................... 3,366 207,851
PacifiCare Health Systems (b) ................ 11,500 991,875
Pharmacia & Upjohn Inc. ...................... 35,400 1,296,525
Schering-Plough Corp. ........................ 18,800 1,367,700
Tenet Healthcare Inc. (b) .................... 49,965 1,230,388
Vencor Inc. (b) .............................. 25,000 946,875
-----------
9,461,614
-----------
Retailing (3.0%):
Footstar Incorporated (b) .................... 34,735 1,029,024
Wal-Mart Stores .............................. 145,500 4,055,813
-----------
5,084,837
-----------
Technology (2.8%):
Digital Equipment Corp. (b) .................. 30,400 832,200
Novell (b) ................................... 103,800 986,100
Scientic-Atlanta Inc. ........................ 56,100 855,525
Silicon Graphics Inc. (b) .................... 88,500 1,725,750
Tencor Instruments (b) ....................... 9,000 325,125
-----------
4,724,700
-----------
Transportation (1.0%):
CSX Corp. .................................... 37,900 1,762,350
-----------
Utilities (7.4%):
360 Communications Co. (b) ................... 105,533 1,820,444
CMS Energy Corp. ............................. 31,400 1,032,275
Entergy Company .............................. 32,000 784,000
Illinova Corp. ............................... 54,600 1,248,975
MCI Communications Corp. ..................... 37,600 1,339,500
New England Electric System .................. 26,500 910,938
Nynex Corp. .................................. 22,000 1,003,750
Pinnacle West Capital Corp. .................. 28,500 858,563
Sprint Corp. ................................. 51,800 2,356,900
Unicom Corp. ................................. 59,100 1,152,450
-----------
12,507,795
-----------
Total Common Stocks
(cost: $149,720,675) ................................. $ 161,112,978
-----------
Short-Term Securities (6.4%):
Repurchase Agreement (6.4%):
State Street Bank & Trust Co. Master
Repurchase Agreement , 4.25%, dated 3/31/97
due 4/01/97, Collateralized by
U.S. Government Securities (delivery
value $10,849,283) ................... $ 10,848,003 10,848,003
-----------
Total Short-Term Securities
(cost: $10,848,003) .................................. 10,848,003
-----------
Total Investments in Securities
(cost: $160,568,678)(d)(101.2%) ...................... 171,960,981
Liabilities Less Other Assets (-1.2%) ........................ (2,097,246)
-----------
Net Assets (100%) ............................................ $ 169,863,735
===========
</TABLE>
- ----------
Notes to Schedule of Investments
(a) Securities are valued in accordance with procedures described in note 1 to
the financial statements.
(b) Currently non-income producing.
(c) Cost is the same for federal income tax purposes. The aggregate gross
unrealized appreciation and depreciation of investments in securities based
on this cost were as follows:
Gross unrealized appreciation $18,109,805
Gross unrealized depreciation (6,717,502)
----------
Net unrealized appreciation $11,392,303
===========
See accompanying notes to financial statements.
- 16 -
<PAGE>
Schedule of Investments (Unaudited)
Griffin Growth Fund
March 31, 1997
[PIE CHART APPEARS HERE]
Business Services 12%
Capital Equipment 4%
Consumer Non-Durables 6%
Financial Services 10%
Health Care 13%
Media & Communications 6%
Resources 6%
Retailing 10%
Technology 24%
Cash 3%
Other 6%
Investment Categories Reflect Percentages of Investments in Securities
<TABLE>
<CAPTION>
Number of Market
Name of Issuer Shares Value(a)
- --------------------------------------------------------------------------------------------------
(Percentage of each investment category relate to total net assets)
<S> <C> <C>
Common Stocks (92.3%):
Business Services (11.7%):
AccuStaff Inc. (b) ........................... 5,300 $ 88,775
ADT Limited (b) .............................. 4,300 107,500
Air Express International .................... 4,600 146,050
Werner Enterprises Inc. ...................... 4,550 85,313
Wisconsin Central Transportation (b) ......... 4,000 141,000
APAC Teleservices (b) ........................ 3,800 98,800
Apollo Group Incorporated (b) ................ 4,700 115,150
Atlantic Southeast Airlines .................. 4,300 89,225
Carnival Corp. ............................... 4,300 159,100
Catalina Marketing Corp. (b) ................. 3,400 138,125
Ceridian Corp. (b) ........................... 3,200 114,800
CKS Group Incorporated (b) ................... 3,800 79,800
Comair Holdings Inc. ......................... 5,550 120,713
CUC International (b) ........................ 10,218 229,905
Equifax Inc. ................................. 5,700 155,325
Equity Corporation International (b) ......... 3,000 63,000
Heritage Media Corp. (b) ..................... 6,400 117,600
Interim Services Incorporated (b) ............ 3,500 136,063
Kansas City Southern Industries Inc. ......... 2,200 110,000
Kelly Services CL A .......................... 2,500 66,875
Manpower ..................................... 4,200 151,200
Mutual Risk Management LTD ................... 4,800 174,000
National Data Corporation .................... 3,500 123,813
Paychex Inc. ................................. 1,900 78,138
PMT Services Incorporated (b) ................ 7,800 85,800
Primark Corporation (b) ...................... 4,900 116,375
Quintiles Transnational Corporation (b) ...... 2,300 123,913
Renaissance Solutions (b) .................... 4,200 106,050
Reynolds & Reynolds .......................... 4,700 112,213
Reuters Holdings PLC ADR ..................... 1,800 104,738
Robert Half International Inc (b) ............ 3,800 132,525
Romac International (b) ...................... 3,600 63,675
Service Corporation International ............ 4,600 136,850
Sitel Corporation (b) ........................ 6,800 90,950
Superior Services (b) ........................ 6,000 133,500
Sylvan Learning Systems (b) .................. 3,550 87,863
The Vincam Group (b) ......................... 3,500 95,813
United Waste Systems (b) ..................... 3,100 $ 115,475
U.S.A. Waste Services (b) .................... 3,650 129,575
-----------
4,525,585
-----------
Capital Equipment (4.2%):
Agco Corp. ................................... 4,400 121,550
Alamo Group Inc. ............................. 3,800 60,325
Commercial Metals Co. ........................ 2,400 68,700
Danaher Corp. ................................ 3,900 162,338
Greenfield Industries Inc. ................... 3,400 74,375
IDEX Corporation ............................. 5,150 121,025
Kennametal Inc. .............................. 2,800 101,500
Littlelfuse Inc. (b) ......................... 2,000 92,500
MSC Industrial Direct Company (b) ............ 3,500 101,938
Parker-Hannifin .............................. 2,800 119,700
Roper Industries ............................. 3,500 147,438
SPX Corporation .............................. 1,500 68,063
Teleflex Inc. ................................ 1,700 89,888
Thermedics Incorporated (b) .................. 6,700 104,688
US Filter Corporation (b) .................... 3,300 101,888
Unisource Worldwide .......................... 4,450 68,419
-----------
1,604,335
-----------
Consumer Cyclicals (3.5%):
Bed Bath & Beyond (b) ........................ 6,100 147,544
Harley-Davidson Inc. ......................... 2,600 88,075
Harman International Industries .............. 2,710 90,785
Lennar Corp. ................................. 3,600 88,200
Lilly Industries ............................. 6,100 110,563
National Health Investors .................... 3,400 126,225
Oakwood Homes Corp. .......................... 6,600 116,325
Rouse Company ................................ 4,500 131,625
Security Capital Pacific Trust ............... 6,300 153,563
Sherwin-Williams Co. ......................... 4,800 129,600
Sturm Ruger & Co. Inc. ....................... 2,900 46,038
Williams-Sonoma Inc. (b) ..................... 4,400 126,500
-----------
1,355,043
-----------
Consumer/ Non-Durable (5.8%):
Alberto-Culver Company ....................... 3,900 101,888
Callaway Golf Co ............................. 2,900 83,013
First Brands Corporation ..................... 4,500 110,250
Goodmark Foods ............................... 4,800 63,000
Gucci Group .................................. 1,500 108,188
Gymboree Corporation (b) ..................... 3,500 94,063
Jones Apparel Group (b) ...................... 3,600 133,650
Lancaster Colony ............................. 3,465 159,390
Mattel Inc. .................................. 4,425 106,200
Nautica Enterprises (b) ...................... 5,500 138,188
Quiksilver Incorporated (b) .................. 5,500 130,625
Robert Mondavi Corp (b) ...................... 4,200 152,250
Sealed Air Corp. (b) ......................... 3,000 123,375
Tootsie Roll Industries ...................... 3,518 157,866
Ultratech Stepper (b) ........................ 3,500 77,438
Unifi Inc. ................................... 5,000 152,500
Warnaco Group ................................ 4,000 119,000
</TABLE>
See accompanying notes to financial statements.
- 17 -
<PAGE>
Schedule of Investments (Unaudited)
Griffin Growth Fund (Continued)
March 31, 1997
<TABLE>
<CAPTION>
Number of Market
Name of Issuer Shares Value(a)
- --------------------------------------------------------------------------------------------------
(Percentage of each investment category relate to total net assets)
<S> <C> <C>
Westwood One Inc. (b) ........................ 4,900 $ 90,650
Wolverine World Wide ......................... 3,850 140,525
-----------
2,242,059
-----------
Financial Services (9.9%):
Aames Financial Corporation .................. 3,750 75,938
ACE Limited .................................. 2,200 140,800
Advanta Corp CL B ............................ 2,400 62,100
Ambac Inc. ................................... 2,500 161,250
Bank of New York Co. Inc. .................... 3,800 139,650
City National Inc. ........................... 6,300 138,600
Concord EFS Incorporated (b) ................. 4,050 75,938
Equitable of Iowa Companies .................. 3,000 150,000
Finova Group Inc. ............................ 2,400 162,300
First American Corp., Tennessee .............. 3,100 197,238
First Bank Systems ........................... 1,700 124,100
First USA Inc. ............................... 4,300 182,213
Franklin Resources Inc. ...................... 4,400 224,400
Green Tree Financial Corp. ................... 3,700 124,875
Investment Technology Group (b) .............. 6,400 121,600
JSB Financial Inc. ........................... 3,400 144,500
MGIC Investment Corporation .................. 2,300 162,725
Northern Trust Corporation ................... 3,800 142,500
Norwest ...................................... 3,260 150,775
Progressive Corporation ...................... 2,500 159,688
Raymond James Financial lnc .................. 4,100 129,663
Roosevelt Financial Group Inc. ............... 2,500 54,375
Schwab (Charles) Corp. ....................... 5,500 175,313
State Street Boston Corporation .............. 1,900 131,813
UICI (b) ..................................... 4,400 100,650
United Asset Management ...................... 6,100 156,313
Vesta Insurance Group ........................ 3,350 119,344
Zurich Reinsurance Centre Holdings ........... 2,300 88,263
-----------
3,796,924
-----------
Health Care (12.6%):
Drugs & Medicine (3.8%):
Amgen (b) .................................... 3,600 201,150
Amway Asia Pacific LTD ....................... 3,700 139,213
Biochem Pharma Inc. (b) ...................... 2,000 86,000
Biogen Inc. (b) .............................. 2,700 100,913
Cardinal Health Inc. ......................... 3,550 193,031
Dura Pharmaceuticals (b) ..................... 3,000 107,250
Gilead Sciences Inc. (b) ..................... 3,300 75,488
Guilford Pharmaceuticals Inc. (b) ............ 4,000 83,000
Human Genome Sciences (b) .................... 3,200 104,000
IDEXX Laboratories (b) ....................... 4,800 67,200
Isis Pharmaceuticals (b) ..................... 4,100 61,500
Life Technologies ............................ 4,700 123,375
SEQUUS Pharmaceuticals Inc. (b) .............. 4,000 30,500
TheraTech Incorporated (b) ................... 8,800 94,600
-----------
1,467,220
-----------
Health Care/Non-Drug (3.1%):
Boston Scientific Corporation (b) ............ 2,700 166,725
Guidant Corporation .......................... 3,300 202,950
Henry Schein Incorporated (b) ................ 5,000 145,000
Medtronic Inc. ............................... 2,100 130,725
Omnicare Inc. ................................ 4,700 110,450
Physio-Control International Corp. (b) ....... 4,500 $ 62,438
Sola International (b) ....................... 3,500 80,938
Target Therapeutics (b) ...................... 2,800 184,100
Uromed Corporation (b) ....................... 6,000 44,250
VISX Incorporated (b) ........................ 3,500 77,438
-----------
1,205,014
-----------
HMO/Hospital Management (5.7%):
Apria HealthCare Group (b) ................... 4,500 81,563
Compdent Corporation (b) ..................... 4,000 112,000
Health Management Association CL A (b) ....... 6,775 160,906
Healthcare & Retirement Corp. (b) ............ 5,950 171,063
Lincare Holdings Incorporated (b) ............ 3,200 132,000
MedPartners/Mullikin Incorporated (b) ........ 4,396 93,415
Orthodontic Centers of America (b) ........... 4,800 64,800
Oxford Health Plans Inc. (b) ................. 2,700 158,288
PacifiCare Health Systems (b) ................ 1,700 146,625
PhyCor Inc. (b) .............................. 4,400 119,900
Quorum Health Group Incorporated (b) ......... 4,200 129,675
Renal Treatment Centers (b) .................. 4,200 94,500
Tenet Healthcare (b) ......................... 4,915 121,032
United HealthCare Corp. ...................... 2,800 133,350
Universal Health Services (b) ................ 4,500 147,938
Vencor Inc. (b) .............................. 5,000 189,375
Vivra Incorporated (b) ....................... 4,300 116,100
-----------
2,172,530
-----------
Total Health Care .................................... 4,844,764
-----------
Media & Communications (5.8%):
360 Communications Company (b) ............... 4,500 77,625
Belo (A.H.) .................................. 3,600 133,200
Carmike Cinemas (b) .......................... 5,400 154,575
Centennial Cellular Corp. (b) ................ 3,100 32,163
Central Newspaper Inc. ....................... 2,300 115,288
Clear Channel Communications Inc. (b) ........ 6,800 291,550
CommNet Cellular (b) ......................... 4,700 119,850
Cox Communications (b) ....................... 5,000 103,125
Emmis Broadcasting (b) ....................... 3,600 139,275
Evergreen Media (b) .......................... 3,000 87,563
Gaylord Entertainment ........................ 4,795 103,093
InterCel Incorporated (b) .................... 5,600 56,000
Jacor Communications (b) ..................... 4,700 129,838
Outdoor Systems (b) .......................... 5,400 161,325
Scholastic Corporation (b) ................... 1,800 50,850
U.S. Cellular Corp. (b) ...................... 3,900 97,013
Valassis Communications (b) .................. 4,000 89,500
Vodafone Group PLC ADR ....................... 3,500 154,438
Wallace Computer Services .................... 4,300 142,438
-----------
2,238,709
-----------
Resources (5.6%):
AES (b) ...................................... 1,500 84,000
Airgas Inc. (b) .............................. 8,300 140,063
Apache Corp. ................................. 3,400 113,900
Barrett Resources Corporation (b) ............ 3,300 98,588
B J Services Co. (b) ......................... 2,600 124,475
Camco International .......................... 3,400 149,600
</TABLE>
See accompanying notes to financial statements.
- 18 -
<PAGE>
Schedule of Investments (Unaudited)
Griffin Growth Fund (Continued)
March 31, 1997
<TABLE>
<CAPTION>
Number of Market
Name of Issuer Shares Value(a)
- --------------------------------------------------------------------------------------------------
(Percentage of each investment category relate to total net assets)
<S> <C> <C>
Devon Energy Corporation ..................... 3,900 $ 117,000
Noble Affiliates ............................. 3,500 132,125
Noble Drilling Corporation (b) ............... 5,800 100,050
Nuevo Energy (b) ............................. 2,500 95,938
Pride Petroleum Services Inc. (b) ............ 6,700 139,025
Smith International (b) ...................... 3,600 164,250
Sonat Inc. ................................... 2,700 147,150
Sybron International Corp. (b) ............... 4,300 119,325
Tosco Corp. .................................. 7,100 202,350
Triton Energy Corp. (b) ...................... 2,900 112,375
United Meridian Corp. (b) .................... 4,000 120,500
-----------
2,160,714
-----------
Retailing (10.0%):
Applebees International Inc. ................. 3,700 89,263
Autozone Inc. (b) ............................ 5,100 114,750
Borders Group Incorporated (b) ............... 7,800 147,225
CDW Computer Centers (b) ..................... 2,000 90,125
Circuit City Stores Inc. ..................... 4,100 136,838
CompUSA Inc. (b) ............................. 5,800 91,350
Dollar General Corp. ......................... 8,731 272,844
Extended Stay America (b) .................... 6,000 88,500
HFS Inc. (b) ................................. 4,400 259,050
Host Marriott (b) ............................ 6,000 102,000
ITT Educational Services (b) ................. 4,800 103,800
La Quinta Inns Inc. .......................... 5,000 102,500
Land's End Inc. (b) .......................... 5,900 156,350
Mirage Resorts (b) ........................... 5,700 121,125
OfficeMax Incorporated (b) ................... 8,000 104,000
Outback Steakhouse Inc. (b) .................. 4,000 80,000
Pep Boys-Manny, Moe & Jack ................... 2,900 87,000
Petco Animal Supplies (b) .................... 4,800 112,800
Petsmart (b) ................................. 5,800 117,450
Quality Food Centers (b) ..................... 1,800 75,600
Quality Dining (b) ........................... 4,500 51,750
Richfood Holdings ............................ 6,400 120,000
Safeway Inc. (b) ............................. 3,600 166,950
Sbarro Inc. .................................. 4,900 138,425
Starbucks Corp. (b) .......................... 4,000 118,500
The Men's Wearhouse Inc. (b) ................. 4,400 121,000
The Sports Authority (b) ..................... 6,000 111,750
Tiffany & Company ............................ 3,600 136,800
TJX Companies ................................ 2,500 106,875
US Office Products (b) ....................... 4,000 99,000
Viking Office Products (b) ................... 6,100 118,188
Zale Corp. (b) ............................... 6,300 115,763
-----------
3,857,571
-----------
Technology (23.2%):
Communications Equipment (2.4%):
Aspect Telecommunications Corp. (b) .......... 5,000 97,500
Checkpoint Systems Incorporated .............. 6,000 102,750
Coherent Communications Systems Corp (b) ..... 4,300 74,175
DSP Communications Inc. (b) .................. 5,600 53,900
Ericsson L.M. Telephone Co. ADR (b) .......... 6,600 223,124
Pairgain Technologies (b) .................... 5,000 148,125
PicureTel (b) ................................ 2,800 33,250
US Robotics Corp. (b) ........................ 3,600 199,350
-----------
932,174
-----------
Computer Communications (2.8%):
3Com Corp. (b) ............................... 2,400 $ 78,600
Ascend Communications Inc. (b) ............... 3,800 154,850
Cabletron Systems Inc. (b) ................... 4,800 140,400
Cascade Communications ....................... 5,000 131,875
Cisco Systems Inc. (b) ....................... 3,600 173,250
Electronics for Imaging (b) .................. 3,000 119,625
Fore Systems (b) ............................. 4,500 67,500
Intermedia Communications (b) ................ 3,300 54,863
Network General (b) .......................... 4,100 88,150
S3 Incorporated (b) .......................... 5,000 65,000
-----------
1,074,113
-----------
Computer/Electronic Equipment (3.4%):
Cognex Corp. (b) ............................. 3,500 66,500
Coherent Inc. (b) ............................ 2,600 124,313
Dionex Corporation (b) ....................... 2,720 123,760
EMC Corp-Mass (b) ............................ 3,900 138,450
KLA Instruments (b) .......................... 4,100 149,650
Lam Research Corp. (b) ....................... 2,200 74,250
Security Dynamics Technologies (b) ........... 4,600 112,700
Symbol Technologies .......................... 2,800 135,100
Teradyne (b) ................................. 2,800 80,850
Tellabs (b) .................................. 6,100 220,363
Thermo Electron Corporation (b) .............. 3,250 100,344
-----------
1,326,280
-----------
Computer Services (2.3%):
ABR Information Services Incorporated (b) .... 5,400 97,200
Cambridge Technology Partners (b) ............ 6,200 143,375
Desktop Data (b) ............................. 6,000 76,500
First Data ................................... 3,302 111,855
HBO & Co. .................................... 3,900 185,250
Saville Systems Ireland PLC (b) .............. 4,000 115,000
Shared Medical Systems Corp. ................. 3,400 158,100
-----------
887,280
-----------
Computer Software (6.5%):
Adobe Systems Inc. ........................... 2,500 100,313
Applix Incorporated (b) ...................... 3,300 21,038
BMC Software Inc. (b) ........................ 5,100 235,238
Cadence Design Systems (b) ................... 4,050 139,219
CBT Group PLC ADR (b) ........................ 2,100 104,738
Citrix Systems (b) ........................... 3,200 42,400
Cognos Incorporated (b) ...................... 4,500 117,000
Compuware (b) ................................ 2,900 181,975
Forte Software (b) ........................... 4,100 94,300
Hummingbird Communications (b) ............... 2,000 52,500
IDX Systems Corporation (b) .................. 4,100 111,725
Informix Corp. (b) ........................... 3,700 55,963
Inso Corporation (b) ......................... 2,800 105,175
Intuit (b) ................................... 3,700 86,025
McAfee Associates Incorporated (b) ........... 3,800 168,150
Oracle Corp. (b) ............................. 5,000 192,813
People Soft Inc. (b) ......................... 4,200 168,000
Rational Software Corporation (b) ............ 3,500 72,188
Remedy Corporation (b) ....................... 2,500 95,625
Sterling Commerce (b) ........................ 4,200 121,800
</TABLE>
See accompanying notes to financial statements.
- 19 -
<PAGE>
Schedule of Investments (Unaudited)
Griffin Growth Fund (Continued)
March 31, 1997
<TABLE>
<CAPTION>
Number of Market
Name of Issuer Shares Value(a)
- --------------------------------------------------------------------------------------------------
(Percentage of each investment category relate to total net assets)
<S> <C> <C>
Symantec Corp. (b) ........................... 6,300 $ 89,775
Synopsys Inc. (b) ............................ 1,900 47,500
Visio Corporation (b) ........................ 2,300 89,700
-----------
2,493,160
-----------
Electronics (4.6%):
Altera Corporation (b) ....................... 5,200 223,600
Andrew Corp. (b) ............................. 4,400 158,950
Atmel (b) .................................... 3,800 90,963
Linear Technology Corp. ...................... 4,700 207,975
Maxim Integrated Products (b) ................ 7,100 343,463
Microchip Technology (b) ..................... 3,600 108,000
Molex Inc CL A ............................... 4,025 140,875
Raychem Corp. ................................ 2,000 164,750
SCI Systems (b) .............................. 2,700 136,688
SDL Incorporated (b) ......................... 2,600 44,525
Xilinx Inc. (b) .............................. 2,800 136,500
-----------
1,756,289
-----------
Other Technology (1.2%):
BE Aerospace (b) ............................. 5,000 122,500
Ikon Office Solutions ........................ 2,600 87,100
Waters Corporation (b) ....................... 3,000 80,250
Sun Microsystems Inc. (b) .................... 6,800 196,350
-----------
486,200
-----------
Total Technology ..................................... 8,955,496
-----------
Total Common Stocks
(cost: $34,566,112) .................................. 35,581,200
-----------
Short-Term Securities (3.1%):
Repurchase Agreement (3.1%):
State Street Bank & Trust Co. Master
Repurchase Agreement, 4.25%, dated 3/31/97
due 4/01/97, Collateralized by
U.S. Government Securities (delivery
value $1,210,450) .................... $ 1,210,307 $ 1,210,307
-----------
Total Short-Term Securities
(cost: $1,210,307) ................................... 1,210,307
-----------
Total Investments in Securities
(cost: $35,776,419)(c)(95.4%) ........................ 36,791,507
Other Assets Less Liabilities (4.6%) ......................... 1,756,028
-----------
Net Assets (100%) ............................................ $ 38,547,535
===========
</TABLE>
- ----------
Notes to Schedule of Investments
(a) Securities are valued in accordance with procedures described in note 1 to
the financial statements.
(b) Currently non-income producing.
(c) Cost is the same for federal income tax purposes. The aggregate gross
unrealized appreciation and depreciation of investments in securities based
on this cost were as follows:
Gross unrealized appreciation $4,055,628
Gross unrealized depreciation (3,040,540)
----------
Net unrealized appreciation $1,015,088
==========
See accompanying notes to financial statements.
- 20 -
<PAGE>
Statements of Assets and Liabilities
(Unaudited)
March 31, 1997
<TABLE>
<CAPTION>
Money Tax-Free Short-Term
Market Money Bond
Fund Market Fund Fund
---- ----------- ----
<S> <C> <C> <C>
Assets
Investments:
In securities, at market value* (note 1) .................... $201,236,422 $ 13,257,736 $ 30,727,451
Cash ..................................................................... 0 0
Receivables:
Dividends and Interest ...................................... 566,883 148,760 537,364
Fund shares sold ............................................ 3,087,928 271,717 914,542
Investment securities sold .................................. 0 0 0
Other receivables ........................................... 0 0 0
Organization expenses, net of amortization (note 1) ...................... 26,535 26,535 16,333
------------ ------------ ------------
Total assets .... 204,917,768 13,704,748 32,301,519
------------ ------------ ------------
Liabilities
Distributions to shareholders ............................................ 824,927 30,818 142,706
Fund shares redeemed ..................................................... 3,745,367 45,276 301,996
Payable for securities purchased ......................................... 0 0 0
Payable for distribution fees ............................................ 31,742 0 2,346
Payable for administration fees .......................................... 31,742 865 4,832
Other accrued expenses ................................................... 96,969 15,290 16,922
------------ ------------ ------------
Total liabilities 4,730,747 92,249 468,802
------------ ------------ ------------
Net Assets ...... $200,187,021 $ 13,612,499 $ 31,832,717
============ ============ ============
Net assets consist of:
Capital stock, Class A or single class ...................... 200,170 13,617 3,179
Capital stock, Class B ...................................... N/A N/A 29
Additional paid in capital, Class A or single class ......... 199,969,639 13,603,575 31,913,271
Additional paid in capital, Class B ......................... N/A N/A 285,989
Undistributed net investment income ......................... 17,212 0 0
Accumulated net realized gain (loss) on investments and
futures contracts ......................................... 0 (4,693) (44,155)
Net unrealized appreciation (depreciation) on investments
and futures contracts ..................................... 0 0 (325,596)
------------ ------------ ------------
Net Assets ...... $200,187,021 $ 13,612,499 $ 31,832,717
============ ============ ============
Computation of net asset value and offering price (note 4):
Net assets, Class A or single class ......................... $200,187,021 $ 13,612,499 $ 31,548,299
Shares outstanding, Class A or single class ................. 200,169,809 13,617,192 3,178,749
Net asset value, Class A or single class .................... $ 1.00 $ 1.00 $ 9.92
Maximum offering price, Class A or single class ............. $ 1.00 $ 1.00 $ 10.28
Net assets, Class B ......................................... N/A N/A $ 284,418
Shares outstanding, Class B ................................. N/A N/A 28,680
Net asset value and offering price, Class B ................. N/A N/A $ 9.92
* Investments in securities, at identified cost .......................... $201,236,422 $ 13,257,736 $ 31,053,047
</TABLE>
See accompanying notes to financial statements.
- 21 -
<PAGE>
<TABLE>
<CAPTION>
U.S. Municipal
Government Bond Bond
Income Fund Fund Fund
----------- ---- ----
<S> <C> <C> <C>
Assets
Investments:
In securities, at market value* (note 1) .................... $ 55,619,968 $ 38,343,236 $ 7,479,058
Cash ..................................................................... 105,829 156,660 76,826
Receivables:
Dividends and Interest ...................................... 484,440 643,349 95,761
Fund shares sold ............................................ 5,267,789 693,218 22,729
Investment securities sold .................................. 1,679,026 2,006,645 0
Other receivables ........................................... 0 296 536
Organization expenses, net of amortization (note 1) ...................... 26,535 26,535 26,535
------------ ------------ ------------
Total assets .... 63,234,418 41,790,105 7,633,120
------------ ------------ ------------
Liabilities
Distributions to shareholders ............................................ 298,145 196,400 28,677
Fund shares redeemed ..................................................... 292,314 236,916 16,099
Payable for securities purchased ......................................... 1,878,875 2,231,688 201,531
Payable for distribution fees ............................................ 8,612 4,376 152
Payable for administration fees .......................................... 8,841 6,051 0
Other accrued expenses ................................................... 43,801 21,039 0
------------ ------------ ------------
Total liabilities 2,530,588 2,696,470 246,459
------------ ------------ ------------
Net Assets ...... $ 60,703,830 $ 39,093,635 $ 7,386,661
============ ============ ============
Net assets consist of:
Capital stock, Class A or single class ...................... 6,418 4,472 786
Capital stock, Class B ...................................... 396 51 43
Additional paid in capital, Class A or single class ......... 58,616,045 39,757,314 7,087,885
Additional paid in capital, Class B ......................... 3,662,015 457,310 386,855
Undistributed net investment income ......................... 6,286 1,645 568
Accumulated net realized gain (loss) on investments and
futures contracts ......................................... (1,125,755) (429,052) (140,665)
Net unrealized appreciation (depreciation) on investments
and futures contracts ..................................... (461,575) (698,105) 51,189
------------ ------------ ------------
Net Assets ...... $ 60,703,830 $ 39,093,635 $ 7,386,661
============ ============ ============
Computation of net asset value and offering price (note 4):
Net assets, Class A or single class ......................... $ 57,171,230 $ 38,650,254 $ 7,005,203
Shares outstanding, Class A or single class ................. 6,417,937 4,472,247 786,315
Net asset value, Class A or single class .................... $ 8.91 $ 8.64 $ 8.91
Maximum offering price, Class A or single class ............. $ 9.33 $ 9.05 $ 9.33
Net assets, Class B ......................................... $ 3,532,600 $ 443,381 $ 381,458
Shares outstanding, Class B ................................. 396,255 51,341 42,805
Net asset value and offering price, Class B ................. $ 8.91 $ 8.64 $ 8.91
* Investments in securities, at identified cost .......................... $ 56,081,543 $ 39,041,341 $ 7,429,338
California Growth &
Tax-Free Income Growth
Fund Fund Fund
---- ---- ----
<S> <C> <C> <C>
Assets
Investments:
In securities, at market value* (note 1) .................... $ 24,957,187 $171,960,981 $ 36,791,507
Cash ..................................................................... 8,501 114,752 319,776
Receivables:
Dividends and Interest ...................................... 422,967 383,811 14,139
Fund shares sold ............................................ 348,720 1,560,992 2,416,076
Investment securities sold .................................. 0 1,289,648 0
Other receivables ........................................... 1,327 11,078 5,126
Organization expenses, net of amortization (note 1) ...................... 26,535 26,535 16,333
------------ ------------ ------------
Total assets .... 25,871,488 175,552,821 39,361,899
------------ ------------ ------------
Liabilities
Distributions to shareholders ............................................ 101,482 0 0
Fund shares redeemed ..................................................... 23,972 2,939,065 253,430
Payable for securities purchased ......................................... 100,201 2,613,593 521,208
Payable for distribution fees ............................................ 1,778 44,060 8,580
Payable for administration fees .......................................... 4,041 27,737 5,958
Other accrued expenses ................................................... 21,558 64,631 25,188
------------ ------------ ------------
Total liabilities 253,032 5,689,086 814,364
------------ ------------ ------------
Net Assets ...... $ 25,618,456 $169,863,735 $ 38,547,535
============ ============ ============
Net assets consist of:
Capital stock, Class A or single class ...................... 2,731 8,713 2,805
Capital stock, Class B ...................................... 507 1,396 217
Additional paid in capital, Class A or single class ......... 21,789,985 127,797,470 35,888,774
Additional paid in capital, Class B ......................... 4,023,209 21,574,950 2,809,576
Undistributed net investment income ......................... 4,661 103,779 (18,033)
Accumulated net realized gain (loss) on investments and
futures contracts ......................................... (434,825) 8,985,124 (1,150,892)
Net unrealized appreciation (depreciation) on investments
and futures contracts ..................................... 232,188 11,392,303 1,015,088
------------ ------------ ------------
Net Assets ...... $ 25,618,456 $169,863,735 $ 38,547,535
============ ============ ============
Computation of net asset value and offering price (note 4):
Net assets, Class A or single class ......................... $ 21,605,511 $146,444,937 $ 35,798,050
Shares outstanding, Class A or single class ................. 2,731,387 8,712,954 2,804,614
Net asset value, Class A or single class .................... $ 7.91 $ 16.81 $ 12.76
Maximum offering price, Class A or single class ............. $ 8.28 $ 17.60 $ 13.36
Net assets, Class B ......................................... $ 4,012,945 $ 23,418,798 $ 2,749,485
Shares outstanding, Class B ................................. 507,185 1,396,128 216,797
Net asset value and offering price, Class B ................. $ 7.91 $ 16.77 $ 12.68
* Investments in securities, at identified cost .......................... $ 24,724,999 $160,568,678 $ 35,776,419
</TABLE>
See accompanying notes to financial statements.
- 22 -
<PAGE>
Statements of Operations
(Unaudited)
For the six months ended March 31, 1997
<TABLE>
<CAPTION>
Money Tax-Free Short-Term
Market Money Bond
Fund Market Fund Fund
---- ----------- ----
<S> <C> <C> <C>
Investment income:
Interest ............................................................... $ 5,301,886 $ 217,376 $ 768,762
Dividends (net of foreign withholding taxes of $4,454
and $216 for the Growth & Income Fund
and Growth Fund, respectively) ....................................... 0 0 0
----------- ----------- -----------
Total Income .................................................. 5,301,886 217,376 768,762
----------- ----------- -----------
Expenses:
Advisory fees (note 2) ................................................. 486,904 30,946 63,164
Administration and accounting fees (note 2) ............................ 194,762 12,378 25,266
Distribution fees (note 2) ............................................. 194,762 12,378 32,339
Amortization of organization expenses .................................. 8,530 8,530 2,544
Legal and audit fees ................................................... 23,717 6,397 7,116
Registration fees ...................................................... 18,384 2,754 5,267
Directors' fees ........................................................ 3,590 3,590 4,097
Shareholder reports .................................................... 21,507 1,361 2,366
Insurance expense ...................................................... 7,458 461 718
Custodian fees ......................................................... 7,359 2,607 853
Printing and postage ................................................... 74,098 10,201 17,100
----------- ----------- -----------
Total expenses ................................................ 1,041,071 91,603 160,830
----------- ----------- -----------
Less:
Waived fees (note 2) ................................................... (486,904) (50,879) (96,257)
Reimbursement from administrator (note 2) .............................. 0 0 (1,487)
Expense reductions (note 5) ............................................ (76) (495) (56)
----------- ----------- -----------
Net expenses .................................................. 554,091 40,229 63,030
----------- ----------- -----------
Net investment income ......................................... 4,747,795 177,147 705,732
----------- ----------- -----------
Realized and unrealized gain (loss) on investments:
Net realized gain (loss) on sale of investments ........................ 0 0 879
Net realized gain (loss) on sale of futures contracts .................. 0 0 0
Net change in unrealized appreciation (depreciation) of investments .... 0 0 (243,844)
Net change in unrealized appreciation of futures contracts ............. 0 0 0
----------- ----------- -----------
Net realized and unrealized gain (loss) on investments ........ 0 0 (242,965)
----------- ----------- -----------
Net increase (decrease) in net assets resulting from operations $ 4,747,795 $ 177,147 $ 462,767
----------- ----------- -----------
</TABLE>
See accompanying notes to financial statements.
- 23 -
<PAGE>
Statements of Operations
(Unaudited)
For the six months ended March 31, 1997
<TABLE>
<CAPTION>
U.S. Municipal
Government Bond Bond
Income Fund Fund Fund
----------- ---- ----
<S> <C> <C> <C>
Investment income:
Interest ............................................................... $ 1,802,764 $ 1,131,531 $ 185,012
Dividends (net of foreign withholding taxes of $4,454
and $216 for the Growth & Income Fund
and Growth Fund, respectively) ....................................... 0 0 0
----------- ----------- -----------
Total Income .................................................. 1,802,764 1,131,531 185,012
----------- ----------- -----------
Expenses:
Advisory fees (note 2) ................................................. 129,541 83,679 17,905
Administration and accounting fees (note 2) ............................ 51,816 33,472 7,162
Distribution fees (note 2) ............................................. 78,290 43,453 10,447
Amortization of organization expenses .................................. 8,530 8,530 8,530
Legal and audit fees ................................................... 10,118 7,691 5,391
Registration fees ...................................................... 6,046 6,623 2,662
Directors' fees ........................................................ 3,590 3,590 3,590
Shareholder reports .................................................... 5,701 3,412 858
Insurance expense ...................................................... 1,899 1,091 284
Custodian fees ......................................................... 6,004 3,696 550
Printing and postage ................................................... 38,478 21,982 8,093
----------- ----------- -----------
Total expenses ................................................ 340,013 217,219 65,472
Less:
Waived fees (note 2) ................................................... (176,566) (116,703) (34,518)
Reimbursement from administrator (note 2) .............................. 0 0 (11,876)
Expense reductions (note 5) ............................................ (956) (94) (477)
----------- ----------- -----------
Net expenses .................................................. 162,491 100,422 18,601
----------- ----------- -----------
Net investment income ......................................... 1,640,273 1,031,109 166,411
----------- ----------- -----------
Realized and unrealized gain (loss) on investments:
Net realized gain (loss) on sale of investments ........................ (463,603) 33,240 3,454
Net realized gain (loss) on sale of futures contracts .................. 0 0 (10,143)
Net change in unrealized appreciation (depreciation) of investments .... (266,646) (457,221) (37,547)
Net change in unrealized appreciation of futures contracts ............. 0 0 3,469
----------- ----------- -----------
Net realized and unrealized gain (loss) on investments ........ (730,249) (423,981) (40,767)
----------- ----------- -----------
Net increase (decrease) in net assets resulting from operations $ 910,024 $ 607,128 $ 125,644
----------- ----------- -----------
<CAPTION>
California Growth &
Tax-Free Income Growth
Fund Fund Fund
---- ---- ----
<S> <C> <C> <C>
Investment income:
Interest ............................................................... 657,931 153,262 18,965
Dividends (net of foreign withholding taxes of $4,454
and $216 for the Growth & Income Fund
and Growth Fund, respectively) ....................................... 0 1,366,663 71,658
----------- ----------- -----------
Total Income .................................................. 657,931 1,519,925 90,623
----------- ----------- -----------
Expenses:
Advisory fees (note 2) ................................................. 61,944 444,079 95,833
Administration and accounting fees (note 2) ............................ 24,778 148,026 31,944
Distribution fees (note 2) ............................................. 44,388 260,289 49,610
Amortization of organization expenses .................................. 8,530 8,530 2,544
Legal and audit fees ................................................... 7,368 17,723 7,657
Registration fees ...................................................... 989 12,789 9,285
Directors' fees ........................................................ 3,590 3,590 4,097
Shareholder reports .................................................... 2,845 13,542 2,905
Insurance expense ...................................................... 986 4,531 884
Custodian fees ......................................................... 1,510 8,039 7,457
Printing and postage ................................................... 16,405 55,147 16,085
----------- ----------- -----------
Total expenses ................................................ 173,333 976,285 228,301
Less:
Waived fees (note 2) ................................................... (102,104) (469,164) (107,459)
Reimbursement from administrator (note 2) .............................. 0 0 0
Expense reductions (note 5) ............................................ (1,398) (1,007) (128)
----------- ----------- -----------
Net expenses .................................................. 69,831 506,114 120,714
----------- ----------- -----------
Net investment income ......................................... 588,100 1,013,811 (30,091)
----------- ----------- -----------
Realized and unrealized gain (loss) on investments:
Net realized gain (loss) on sale of investments ........................ 26,915 10,892,254 (858,587)
Net realized gain (loss) on sale of futures contracts .................. (27,242) 0 0
Net change in unrealized appreciation (depreciation) of investments .... (88,631) 1,732,677 (2,086,466)
Net change in unrealized appreciation of futures contracts ............. 6,000 0 0
----------- ----------- -----------
Net realized and unrealized gain (loss) on investments ........ (82,958) 12,624,931 (2,945,053)
----------- ----------- -----------
Net increase (decrease) in net assets resulting from operations $ 505,142 $ 13,638,742 ($2,975,144)
----------- ----------- -----------
</TABLE>
See accompanying notes to financial statements.
- 24 -
<PAGE>
Statements of Changes in Net Assets
(Unaudited)
For the periods ended March 31, 1997 and September 30, 1996
<TABLE>
<CAPTION>
Tax-Free
Money Market Fund Money Market Fund
----------------- -----------------
Six Months Year Six Months Year
Ended Ended Ended Ended
3/31/97 9/30/96 3/31/97 9/30/96
------- ------- ------- -------
<S> <C> <C> <C> <C>
Increase in net assets:
Operations:
Net investment income .................. $ 4,747,795 $ 7,637,141 $ 177,147 $ 312,984
Net realized gain (loss)
on sale of investments ............... 0 9,683 0 101
Net change in unrealized appreciation
(depreciation) of investments ........ 0 0 0 0
------------- ------------- ------------- -------------
Net increase (decrease) in net
assets resulting from operations 4,747,795 7,646,824 177,147 313,085
------------- ------------- ------------- -------------
Distributions to shareholders:
From net investment income
Class A ................................ (4,747,795) (7,629,613) (177,147) (312,984)
Class B ................................ N/A N/A N/A N/A
From realized gain on investments
Class A ................................ 0 (7,529) 0 0
Class B ................................ N/A N/A N/A N/A
------------- ------------- ------------- -------------
Total distributions .............. (4,747,795) (7,637,142) (177,147) (312,984)
Net increase in net assets resulting
from capital share transactions (note 4) ..... 15,538,890 104,674,446 1,960,935 3,030,129
------------- ------------- ------------- -------------
Increase in net assets ........... $ 15,538,890 $ 104,684,128 $ 1,960,935 $ 3,030,230
------------- ------------- ------------- -------------
Net assets:
Beginning net assets ....................... 184,648,131 79,964,003 11,651,564 8,621,334
------------- ------------- ------------- -------------
Ending net assets .......................... $ 200,187,021 $ 184,648,131 $ 13,612,499 $ 11,651,564
============= ============= ============= =============
<CAPTION>
Short-Term U.S. Government
Bond Fund Income Fund
--------- -----------
Six Months Year Six Months Year
Ended Ended Ended Ended
3/31/97 9/30/96 3/31/97 9/30/96
------- ------- ------- -------
<S> <C> <C> <C> <C>
Increase in net assets:
Operations:
Net investment income .................. $ 705,732 $ 622,464 $ 1,640,273 $ 2,526,598
Net realized gain (loss)
on sale of investments ............... 879 (44,897) (463,603) (663,449)
Net change in unrealized appreciation
(depreciation) of investments ........ (243,844) (93,004) (266,646) (415,895)
------------- ------------ ------------ ------------
Net increase (decrease) in net
assets resulting from operations 462,767 484,563 910,024 1,447,254
------------- ------------ ------------ ------------
Distributions to shareholders:
From net investment income
Class A ................................ (700,655) (619,703) (1,534,806) (2,357,864)
Class B ................................ (5,077) (2,761) (105,467) (168,735)
From realized gain on investments
Class A ................................ 0 0 0 (83,304)
Class B ................................ 0 0 0 (6,386)
------------- ------------ ------------ ------------
Total distributions .............. (705,732) (622,464) (1,640,273) (2,616,289)
Net increase in net assets resulting
from capital share transactions (note 4) ..... 12,379,335 16,238,690 14,277,524 17,454,019
------------- ------------ ------------ ------------
Increase in net assets ........... $ 12,136,370 $ 16,100,789 $ 13,547,275 $ 16,284,984
------------- ------------ ------------ ------------
Net assets:
Beginning net assets ....................... 19,696,347 3,595,558 47,156,555 30,871,571
------------- ------------ ------------ ------------
Ending net assets .......................... $ 31,832,717 $ 19,696,347 $ 60,703,830 $ 47,156,555
============ =========== =========== ===========
</TABLE>
See accompanying notes to financial statements.
- 25 -
<PAGE>
Statements of Changes in Net Assets
(Unaudited)
For the periods ended March 31, 1997 and September 30, 1996
<TABLE>
<CAPTION>
Bond Fund Municipal Bond Fund
--------- -------------------
Six Months Year Six Months Year
Ended Ended Ended Ended
3/31/97 9/30/96 3/31/97 9/30/96
------- ------- ------- -------
<S> <C> <C> <C> <C>
Increase in net assets:
Operations:
Net investment income .................. $ 1,031,109 $ 1,302,493 $ 166,411 $ 308,447
Net realized gain (loss)
on sale of investments ............... 33,240 (396,666) (6,689) (26,860)
Net change in unrealized appreciation
(depreciation) of investments ........ (457,221) (381,786) (34,078) (12,382)
------------- ----------- ----------- -----------
Net increase (decrease) in net
assets resulting from operations 607,128 524,041 125,644 269,205
------------- ----------- ----------- -----------
Distributions to shareholders:
From net investment income
Class A ................................ (1,018,958) (1,285,950) (158,125) (297,309)
Class B ................................ (12,151) (16,542) (8,286) (11,138)
From realized gain on investments
Class A ................................ 0 0 0 0
Class B ................................ 0 0 0 0
------------- ----------- ----------- -----------
Total distributions .............. (1,031,109) (1,302,492) (166,411) (308,447)
Net increase in net assets resulting
from capital share transactions (note 4) ..... 11,343,844 16,780,563 462,442 1,436,099
------------- ----------- ----------- -----------
Increase in net assets ........... $ 10,919,863 $ 16,002,112 $ 421,675 $ 1,396,857
------------- ----------- ----------- -----------
Net assets:
Beginning net assets ....................... 28,173,772 12,171,660 6,964,986 5,568,129
------------- ----------- ----------- -----------
Ending net assets .......................... $ 39,093,635 $ 28,173,772 $ 7,386,661 $ 6,964,986
============ ============ ============ ===========
<CAPTION>
California
Tax-Free Fund Growth & Income Fund
------------- --------------------
Six Months Year Six Months Year
Ended Ended Ended Ended
3/31/97 9/30/96 3/31/97 9/30/96
------- ------- ------- -------
<S> <C> <C> <C> <C>
Increase in net assets:
Operations:
Net investment income .................. $ 588,100 $ 1,090,105 $ 1,013,811 $ 1,166,570
Net realized gain (loss)
on sale of investments ............... (327) 86,379 10,892,254 7,926,105
Net change in unrealized appreciation
(depreciation) of investments ........ (82,631) (73,857) 1,732,677 3,796,225
------------- ------------- ------------- -------------
Net increase (decrease) in net
assets resulting from operations 505,142 1,102,627 13,638,742 12,888,900
------------- ------------- ------------- -------------
Distributions to shareholders:
From net investment income
Class A ................................ (511,139) (1,002,858) (853,438) (1,046,755)
Class B ................................ (76,961) (87,246) (86,873) (97,312)
From realized gain on investments
Class A ................................ 0 0 (8,171,142) (1,178,916)
Class B ................................ 0 0 (1,266,700) (97,876)
------------- ------------- ------------- -------------
Total distributions .............. (588,100) (1,090,104) (10,378,153) (2,420,859)
Net increase in net assets resulting
from capital share transactions (note 4) ..... 1,666,052 3,765,357 47,459,675 67,305,092
------------- ------------- ------------- -------------
Increase in net assets ........... $ 1,583,094 $ 3,777,880 $ 50,720,264 $ 77,773,133
------------- ------------- ------------- -------------
Net assets:
Beginning net assets ....................... 24,035,362 20,257,482 119,143,471 41,370,338
------------- ------------- ------------- -------------
Ending net assets .......................... $ 25,618,456 $ 24,035,362 $ 169,863,735 $ 119,143,471
============= ============= ============= =============
<CAPTION>
Growth Fund
-----------
Six Months Year
Ended Ended
3/31/97 9/30/96
------------ ------------
<S> <C> <C>
Increase in net assets:
Operations:
Net investment income .................. $ (30,091) $ 22,583
Net realized gain (loss)
on sale of investments ............... (858,587) (290,727)
Net change in unrealized appreciation
(depreciation) of investments ........ (2,086,466) 2,744,987
------------ ------------
Net increase (decrease) in net
assets resulting from operations (2,975,144) 2,476,843
------------ ------------
Distributions to shareholders:
From net investment income
Class A ................................ 0 (20,757)
Class B ................................ 0 (551)
From realized gain on investments
Class A ................................ 0 0
Class B ................................ 0 0
------------ ------------
Total distributions .............. 0 (21,308)
Net increase in net assets resulting
from capital share transactions (note 4) ..... 18,325,144 16,406,270
------------ ------------
Increase in net assets ........... $ 15,350,000 $ 18,861,805
============ ============
Net assets:
Beginning net assets ....................... 23,197,535 4,335,730
------------ ------------
Ending net assets .......................... $ 38,547,535 $ 23,197,535
============ ============
</TABLE>
See accompanying notes to financial statements.
- 26 -
<PAGE>
<TABLE>
<CAPTION>
Supplemental information for a share outstanding for the Money Market Fund
six month period ended March 31, 1997 or throughout each -------------------------------------------------------------
fiscal year or period ended September 30. 1997 1996 1995 1994(a)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------
Net asset value - beginning of period ................... $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income ................................... 0.02 0.05 0.05 0.03
Net realized and unrealized gain (loss) on investments .. 0.00 0.00 0.00 0.00
- ------------------------------------------------------------------------------------------------------------------------
Total from investment operations ..................... 0.02 0.05 0.05 0.03
- ------------------------------------------------------------------------------------------------------------------------
Less distributions:
Distributions from net investment income ................ (0.02) (0.05) (0.05) (0.03)
Distributions from net realized gain (loss) ............. 0.00 0.00 0.00 0.00
Total distributions .................................. (0.02) (0.05) (0.05) (0.03)
- ------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value ........... 0.00 0.00 0.00 0.00
- ------------------------------------------------------------------------------------------------------------------------
Net asset value - end of period ...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00
========================================================================================================================
Total return (not annualized)(d) ........................ 2.46% 5.05% 5.52% 3.36%
========================================================================================================================
Ratios/supplemental data:
Net assets, end of period (000) ......................... $ 201,236 $ 184,648 $ 79,964 $ 49,988
Ratios to average net assets (annualized):
Ratio of net expenses to average net assets(i) .......... 0.57% 0.58% 0.42% 0.15%
Ratio of net investment income to average net assets (ii) 4.87% 4.92% 5.40% 4.25%
(i) Ratio of net expenses to average net assets
prior to waivers and reimbursements (f) ........... 1.07% 1.09% 1.29% 1.64%
(ii) Ratio of net investment income to average net
assets prior to waivers and reimbursements (f) .... 2.18% 4.41% 4.53% 2.76%
Portfolio Turnover ...................................... N/A N/A N/A N/A
Average Commission Rate Paid ............................ N/A N/A N/A N/A
- ------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Supplemental information for a share outstanding for the Tax-Free Money Market Fund
six month period ended March 31, 1997 or throughout each -------------------------------------------------------------
fiscal year or period ended September 30. 1997 1996 1995 1994(a)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------
Net asset value - beginning of period ................... $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income ................................... 0.01 0.03 0.03 0.02
Net realized and unrealized gain (loss) on investments .. 0.00 0.00 0.00 0.00
- ------------------------------------------------------------------------------------------------------------------------
Total from investment operations ..................... 0.01 0.03 0.03 0.02
- ------------------------------------------------------------------------------------------------------------------------
Less distributions:
Distributions from net investment income ................ (0.01) (0.03) (0.03) (0.02)
Distributions from net realized gain (loss) ............. 0.00 0.00 0.00 0.00
Total distributions .................................. (0.01) (0.03) (0.03) (0.02)
- ------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value ........... 0.00 0.00 0.00 0.00
- ------------------------------------------------------------------------------------------------------------------------
Net asset value - end of period ...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00
========================================================================================================================
Total return (not annualized)(d) ........................ 1.43% 3.00% 3.44% 2.22%
========================================================================================================================
Ratios/supplemental data:
Net assets, end of period (000) ......................... $ 13,258 $ 11,652 $ 8,621 $ 10,633
Ratios to average net assets (annualized):
Ratio of net expenses to average net assets(i) .......... 0.66% 0.62% 0.44% 0.17%
Ratio of net investment income to average net assets (ii) 2.86% 2.93% 3.39% 2.56%
(i) Ratio of net expenses to average net assets
prior to waivers and reimbursements (f) ........... 1.48% 1.53% 1.90% 2.28%
(ii) Ratio of net investment income to average net
assets prior to waivers and reimbursements (f) .... 2.04% 2.02% 1.92% 0.45%
Portfolio Turnover ...................................... N/A N/A N/A N/A
Average Commission Rate Paid ............................ N/A N/A N/A N/A
<CAPTION>
Bond Fund
Supplemental information for a share outstanding for the Class A
six month period ended March 31, 1997 or throughout each -------------------------------------------------------------
fiscal year or period ended September 30. 1997 1996 1995(e) 1994(a)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------
Net asset value - beginning of period ................... $ 8.71 $ 8.99 $ 8.47 $ 9.50
- ------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income ................................... 0.27 0.56 0.58 0.52
Net realized and unrealized gain (loss) on investments .. (0.07) (0.28) 0.52 (1.03)
- ------------------------------------------------------------------------------------------------------------------------
Total from investment operations ..................... 0.20 0.28 1.10 (0.51)
- ------------------------------------------------------------------------------------------------------------------------
Less distributions:
Distributions from net investment income ................ (0.27) (0.56) (0.58) (0.52)
Distributions from net realized gain (loss) ............. 0.00 0.00 0.00 0.00
- ------------------------------------------------------------------------------------------------------------------------
Total distributions ................................. (0.27) (0.56) (0.58) (0.52)
- ------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value .......... (0.07) (0.28) 0.52 (1.03)
- ------------------------------------------------------------------------------------------------------------------------
Net asset value - end of period ..................... $ 8.64 $ 8.71 $ 8.99 $ 8.47
========================================================================================================================
Total return (not annualized)(d) ........................ 2.28% 3.12% 13.53% (5.49)%
========================================================================================================================
Ratios/supplemental data:
Net assets, end of period (000) ......................... $ 38,650 $ 27,761 $ 12,022 $ 7,539
Ratios to average net assets (annualized):
Ratio of net expenses to average net assets(i) .......... 0.59% 0.47% 0.21% 0.09%
Ratio of net investment income to average net assets (ii) 6.15% 6.25% 6.69% 6.29%
(i) Ratio of net expenses to average net assets
prior to waivers and reimbursements (f) .......... 1.29% 1.42% 2.20% 2.55%
(ii) Ratio of net investment income to average net
assets prior to waivers and reimbursements (f) .... 2.72% 5.29% 4.70% 3.83%
Portfolio Turnover ...................................... 63.00% 170.64% 327.31% 26.14%
Average Commission Rate Paid ............................ N/A N/A N/A N/A
- ------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Bond Fund
Supplemental information for a share outstanding for the Class B
six month period ended March 31, 1997 or throughout each ------------------------------------
fiscal year or period ended September 30. 1997 1996 1995(c)(e)
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
Net asset value - beginning of period ................... $ 8.70 $ 8.98 $ 8.36
- -----------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income ................................... 0.25 0.51 0.49
Net realized and unrealized gain (loss) on investments .. (0.06) (0.28) 0.62
- -----------------------------------------------------------------------------------------------
Total from investment operations ..................... 0.19 0.23 1.11
- -----------------------------------------------------------------------------------------------
Less distributions:
Distributions from net investment income ................ (0.25) (0.51) (0.49)
Distributions from net realized gain (loss) ............. 0.00 0.00 0.00
- -----------------------------------------------------------------------------------------------
Total distributions ................................. (0.25) (0.51) (0.49)
- -----------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value .......... (0.06) (0.28) 0.62
- -----------------------------------------------------------------------------------------------
Net asset value - end of period ..................... $ 8.64 $ 8.70 $ 8.98
===============================================================================================
Total return (not annualized)(d) ........................ 2.15% 2.62% 13.58%
===============================================================================================
Ratios/supplemental data:
Net assets, end of period (000) ......................... $ 443 $ 412 $ 150
Ratios to average net assets (annualized):
Ratio of net expenses to average net assets(i) .......... 1.09% 0.96% 0.78%
Ratio of net investment income to average net assets (ii) 5.64% 5.66% 5.56%
(i) Ratio of net expenses to average net assets
prior to waivers and reimbursements (f) .......... 2.03% 2.15% 4.00%
(ii) Ratio of net investment income to average net
assets prior to waivers and reimbursements (f) .... 2.34% 4.48% 2.34%
Portfolio Turnover ...................................... 63.00% 170.64% 327.31%
Average Commission Rate Paid ............................ N/A N/A N/A
</TABLE>
- ----------
(a) The fund commenced operations on October 19, 1993.
(b) The fund commenced operations on June 12, 1995.
(c) Class B shares were not offered until November 1, 1994.
(d) Total return represents aggregate total return for the period indicated and
does not reflect any applicable sales charge.
(e) The fund was managed by Piper Capital Management, Inc. until December 1,
1994 when The Boston Company Asset Management, Inc. assumed management
responsibilities.
(f) Ratio reflects fees reduced in connection with specific agreements only for
periods ended after September 30, 1995.
See accompanying notes to financial statements.
- 27 -
<PAGE>
<TABLE>
<CAPTION>
Short-Term Bond Fund
Supplemental information for a share outstanding for the Class A Class B
six month period ended March 31, 1997 or throughout each ---------------------------------------- -------------------------------
fiscal year or period ended September 30. 1997 1996 1995(b) 1997 1996 1995(b)
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value - beginning of period ................... $9.98 $10.05 $10.00 $9.98 $10.05 $10.00
- -----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income ................................... 0.28 0.54 0.18 0.27 0.49 0.20
Net realized and unrealized gain (loss) on investments .. (0.06) (0.07) 0.05 (0.06) (0.07) 0.05
- -----------------------------------------------------------------------------------------------------------------------------------
Total from investment operations ..................... 0.22 0.47 0.23 0.21 0.42 0.25
- -----------------------------------------------------------------------------------------------------------------------------------
Less distributions:
Distributions from net investment income ................ (0.28) (0.54) (0.18) (0.27) (0.49) (0.20)
Distributions from net realized gain (loss) ............. 0.00 0.00 0.00 0.00 0.00 0.00
Total distributions .................................. (0.28) (0.54) (0.18) (0.27) (0.49) (0.20)
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value ........... (0.06) (0.07) 0.05 (0.06) (0.07) 0.05
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value - end of period ...................... $9.92 $9.98 $10.05 $9.92 $9.98 $10.05
====================================================================================================================================
Total return (not annualized)(d) ........................ 2.19% 4.82% 2.32% 1.94% 4.29% 2.51%
====================================================================================================================================
Ratios/supplemental data:
Net assets, end of period (000) ......................... $31,548 $19,554 $3,582 $284 $143 $13
Ratios to average net assets (annualized):
Ratio of net expenses to average net assets(i) .......... 0.49% 0.39% 0.00% 0.99% 0.90% 0.00%
Ratio of net investment income to average net assets (ii) 5.57% 5.42% 5.91% 5.02% 4.81% 5.54%
(i) Ratio of net expenses to average net assets
prior to waivers and reimbursements (f) ........... 1.26% 1.58% 2.76% 2.00% 2.29% 3.33%
(ii) Ratio of net investment income to average net
assets prior to waivers and reimbursements (f) .... 4.80% 4.23% 3.15% 4.01% 3.42% 2.21%
Portfolio Turnover ...................................... 9.18% 29.37% 1.05% 9.18% 29.37% 1.05%
Average Commission Rate Paid ............................ N/A N/A N/A N/A N/A N/A
- -----------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
U.S. Government Income Fund
Supplemental information for a share outstanding for the Class A
six month period ended March 31, 1997 or throughout each -------------------------------------------------------------
fiscal year or period ended September 30. 1997 1996 1995(e) 1994(a)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------
Net asset value - beginning of period ................... $9.01 $9.24 $8.77 $9.50
- ------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income ................................... 0.29 0.57 0.63 0.56
Net realized and unrealized gain (loss) on investments .. (0.10) (0.21) 0.47 (0.73)
- ------------------------------------------------------------------------------------------------------------------------
Total from investment operations ..................... 0.19 0.36 1.10 (0.17)
- ------------------------------------------------------------------------------------------------------------------------
Less distributions:
Distributions from net investment income ................ (0.29) (0.57) (0.63) (0.56)
Distributions from net realized gain (loss) ............. 0.00 (0.02) 0.00 0.00
- ------------------------------------------------------------------------------------------------------------------------
Total distributions .................................. (0.29) (0.59) (0.63) (0.56)
- ------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value ........... (0.10) (0.23) 0.47 (0.73)
- ------------------------------------------------------------------------------------------------------------------------
Net asset value - end of period ...................... $8.91 $9.01 $9.24 $8.77
========================================================================================================================
Total return (not annualized)(d) ........................ 2.07% 4.02% 13.00% (1.83)%
========================================================================================================================
Ratios/supplemental data:
Net assets, end of period (000) ......................... $57,171 $43,717 $29,308 $19,158
Ratios to average net assets (annualized):
Ratio of net expenses to average net assets(i) .......... 0.59% 0.46% 0.21% 0.09%
Ratio of net investment income to average net assets (ii) 6.34% 6.23% 6.93% 6.24%
(i) Ratio of net expenses to average net assets
prior to waivers and reimbursements (f) ........... 1.26% 1.29% 1.63% 1.83%
(ii) Ratio of net investment income to average net
assets prior to waivers and reimbursements (f) .... 5.68% 5.41% 5.51% 4.49%
Portfolio Turnover ...................................... 146.10% 101.00% 46.96% 28.20%
Average Commission Rate Paid ............................ N/A N/A N/A N/A
- ------------------------------------------------------------------------------------------------------------------------
<CAPTION>
U.S. Government Income Fund
Supplemental information for a share outstanding for the Class B
six month period ended March 31, 1997 or throughout each ----------------------------------------------
fiscal year or period ended September 30. 1997 1996 1995(c)(e)
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------
Net asset value - beginning of period ................... $9.02 $9.25 $8.67
- ---------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income ................................... 0.27 0.53 0.52
Net realized and unrealized gain (loss) on investments .. (0.11) (0.21) 0.58
- ---------------------------------------------------------------------------------------------------------
Total from investment operations ..................... 0.16 0.32 1.10
- ---------------------------------------------------------------------------------------------------------
Less distributions:
Distributions from net investment income ................ (0.27) (0.53) (0.52)
Distributions from net realized gain (loss) ............. 0.00 (0.02) 0.00
- ---------------------------------------------------------------------------------------------------------
Total distributions .................................. (0.27) (0.55) (0.52)
- ---------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value ........... (0.11) (0.23) 0.58
- ---------------------------------------------------------------------------------------------------------
Net asset value - end of period ...................... $8.91 $9.02 $9.25
=========================================================================================================
Total return (not annualized)(d) ........................ 1.71% 3.51% 13.08%
=========================================================================================================
Ratios/supplemental data:
Net assets, end of period (000) ......................... $3,533 $3,439 $1,564
Ratios to average net assets (annualized):
Ratio of net expenses to average net assets(i) .......... 1.09% 0.96% 0.79%
Ratio of net investment income to average net assets (ii) 5.85% 5.67% 5.71%
(i) Ratio of net expenses to average net assets
prior to waivers and reimbursements (f) ........... 2.01% 2.02% 3.19%
(ii) Ratio of net investment income to average net
assets prior to waivers and reimbursements (f) .... 4.93% 4.61% 3.31%
Portfolio Turnover ...................................... 146.10% 101.00% 46.96%
Average Commission Rate Paid ............................ N/A N/A N/A
- ---------------------------------------------------------------------------------------------------------
<CAPTION>
Growth & Income Fund
Supplemental information for a share outstanding for the Class A
six month period ended March 31, 1997 or throughout each -------------------------------------------------------------
fiscal year or period ended September 30. 1997 1996 1995(e) 1994(a)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------
Net asset value - beginning of period ................... $16.29 $14.30 $11.14 $11.00
- ------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income ................................... 0.12 0.21 0.27 0.23
Net realized and unrealized gain (loss) on investments .. 1.65 2.32 3.22 0.13
- ------------------------------------------------------------------------------------------------------------------------
Total from investment operations ..................... 1.77 2.53 3.49 0.36
Less distributions:
Distributions from net investment income ................ (0.11) (0.21) (0.27) (0.22)
Distributions from net realized gain (loss) ............. (1.14) (0.33) (0.06) 0.00
- ------------------------------------------------------------------------------------------------------------------------
Total distributions ................................. (1.25) (0.54) (0.33) (0.22)
- ------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value .......... 0.52 1.99 3.16 0.14
- ------------------------------------------------------------------------------------------------------------------------
Net asset value - end of period ..................... $16.81 $16.29 $14.30 $11.14
========================================================================================================================
Total return (not annualized)(d) ........................ 10.98% 18.08% 31.93% 3.29%
========================================================================================================================
Ratios/supplemental data:
Net assets, end of period (000) ......................... $146,445 $102,485 $38,483 $14,174
Ratios to average net assets (annualized):
Ratio of net expenses to average net assets(i) .......... 0.62% 0.72% 0.43% 0.25%
Ratio of net investment income to average net assets (ii) 1.68% 1.49% 2.30% 2.81%
(i) Ratio of net expenses to average net assets
prior to waivers and reimbursements (f) .......... 1.22% 1.34% 1.80% 2.17%
(ii) Ratio of net investment income to average net
assets prior to waivers and reimbursements (f) .... 1.09% 0.88% 0.93% 0.89%
Portfolio Turnover ...................................... 43.33% 66.32% 92.01% 13.90%
Average Commission Rate Paid ............................ $0.0567 $0.0498 N/A N/A
- ------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Growth & Income Fund
Supplemental information for a share outstanding for the Class B
six month period ended March 31, 1997 or throughout each -----------------------------------------------
fiscal year or period ended September 30. 1997 1996 1995(c)(e)
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------
Net asset value - beginning of period ................... $16.26 $14.29 $11.30
- ----------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income ................................... 0.08 0.17 0.23
Net realized and unrealized gain (loss) on investments .. 1.64 2.28 3.05
- ----------------------------------------------------------------------------------------------------------
Total from investment operations ..................... 1.72 2.45 3.28
Less distributions:
Distributions from net investment income ................ (0.07) (0.15) (0.23)
Distributions from net realized gain (loss) ............. (1.14) (0.33) (0.06)
- ----------------------------------------------------------------------------------------------------------
Total distributions ................................. (1.21) (0.48) (0.29)
- ----------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value .......... 0.51 1.97 2.99
- ----------------------------------------------------------------------------------------------------------
Net asset value - end of period ..................... $16.77 $16.26 $14.29
==========================================================================================================
Total return (not annualized)(d) ........................ 10.69% 17.48% 29.53%
==========================================================================================================
Ratios/supplemental data:
Net assets, end of period (000) ......................... $23,419 $16,658 $2,887
Ratios to average net assets (annualized):
Ratio of net expenses to average net assets(i) .......... 1.12% 1.22% 1.01%
Ratio of net investment income to average net assets (ii) 0.93% 0.97% 1.64%
(i) Ratio of net expenses to average net assets
prior to waivers and reimbursements (f) .......... 1.97% 2.07% 2.92%
(ii) Ratio of net investment income to average net
assets prior to waivers and reimbursements (f) .... 0.09% 0.12% (0.27)%
Portfolio Turnover ...................................... 43.33% 66.32% 92.01%
Average Commission Rate Paid ............................ $0.0567 $0.0498 N/A
- ----------------------------------------------------------------------------------------------------------
<CAPTION>
Growth Fund
Supplemental information for a share outstanding for the Class A Class B
six month period ended March 31, 1997 or throughout each ---------------------------------------- -------------------------------
fiscal year or period ended September 30. 1997 1996 1995(b) 1997 1996 1995(b)
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value - beginning of period ................... $13.76 $11.66 $10.00 $13.70 $11.65 $10.00
- -----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income ................................... (0.01) 0.01 0.03 (0.04) (0.02) 0.03
Net realized and unrealized gain (loss) on investments .. (0.99) 2.12 1.63 (0.98) 2.09 1.62
- -----------------------------------------------------------------------------------------------------------------------------------
Total from investment operations ..................... (1.00) 2.13 1.66 (1.02) 2.07 1.65
Less distributions:
Distributions from net investment income ................ 0.00 (0.03) 0.00 0.00 (0.02) 0.00
Distributions from net realized gain (loss) ............. 0.00 0.00 0.00 0.00 0.00 0.00
- -----------------------------------------------------------------------------------------------------------------------------------
Total distributions ................................. 0.00 (0.03) 0.00 0.00 (0.02) 0.00
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value .......... (1.00) 2.10 1.66 (1.02) 2.05 1.65
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value - end of period ..................... $12.76 $13.76 $11.66 $12.68 $13.70 $11.65
===================================================================================================================================
Total return (not annualized)(d) ........................ (7.27)% 18.35% 16.60% (7.45)% 17.80% 16.50%
===================================================================================================================================
Ratios/supplemental data:
Net assets, end of period (000) ......................... $35,798 $21,027 $4,187 $2,749 $2,170 $149
Ratios to average net assets (annualized):
Ratio of net expenses to average net assets(i) .......... 0.72% 0.49% 0.00% 1.21% 1.01% 0.00%
Ratio of net investment income to average net assets (ii) 0.03% 0.21% 1.20% (0.65)% (0.36)% 107.00%
(i) Ratio of net expenses to average net assets
prior to waivers and reimbursements (f) .......... 1.37% 1.68% 3.46% 2.12% 2.43% 3.85%
(ii) Ratio of net investment income to average net
assets prior to waivers and reimbursements (f) .... (0.62)% (0.98)% (2.26)% (1.55)% (1.78)% (2.78)%
Portfolio Turnover ...................................... 10.34% 16.40% 0.06% 10.34% 16.40% 0.06%
Average Commission Rate Paid ............................ $0.0271 $0.0281 N/A $0.0271 $0.0281 N/A
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes to financial statements.
- 28 -
<PAGE>
Financial Highlights
(Unaudited)
<TABLE>
<CAPTION>
Municipal Bond Fund
Supplemental information for a share outstanding for Class A Class B
the six month period ended March 31, 1997 or throughout ------------------------------------------ -----------------------------
each fiscal year or period ended September 30. 1997 1996 1995 1994(a) 1997 1996 1995(b)
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value - beginning of period ............... $ 8.95 $ 8.98 $ 8.60 $ 9.50 $ 8.96 $ 8.98 $ 8.31
- -----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income ............................... 0.21 0.44 0.47 0.42 0.19 0.40 0.38
Net realized and unrealized gain (loss) on
investments ...................................... (0.04) (0.03) 0.38 (0.90) (0.05) (0.02) 0.67
- -----------------------------------------------------------------------------------------------------------------------------------
Total from investment operations ................. 0.17 0.41 0.85 (0.48) 0.14 0.38 1.05
- -----------------------------------------------------------------------------------------------------------------------------------
Less distributions:
Distributions from net investment income ............ (0.21) (0.44) (0.47) (0.42) (0.19) (0.40) (0.38)
Distributions from net realized gain (loss) ......... 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Total distributions .............................. (0.21) (0.44) (0.47) (0.42) (0.19) (0.40) (0.38)
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value ....... (0.04) (0.03) 0.38 (0.90) (0.05) (0.02) 0.67
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value - end of period .................. $8.91 $8.95 $8.98 $8.60 $8.91 $8.96 $8.98
===================================================================================================================================
Total return (not annualized)(c) .................... 1.89% 4.64% 10.18% (5.15)% 1.53% 4.22% 12.86%
===================================================================================================================================
Ratios/supplemental data:
Net assets, end of period (000) ..................... $ 7,005 $ 6,540 $ 5,512 $ 2,610 $ 381 $ 425 $ 56
Ratios to average net assets (annualized):
Ratio of net expenses to average net assets(i) ...... 0.50% 0.41% 0.40% 0.25% 1.00% 0.91% 0.90%
Ratio of net investment income to average net
assets (ii) ...................................... 4.67% 4.88% 5.26% 5.03% 4.16% 4.27% 4.26%
(i) Ratio of net expenses to average net assets
prior to waivers and reimbursements (e) ....... 1.79% 1.95% 3.30% 3.99% 2.53% 2.53% 5.56%
(ii) Ratio of net investment income to average net
assets prior to waivers and reimbursements (e) 1.69% 3.35% 2.36% 1.29% 1.31% 2.64% (0.40)%
Portfolio Turnover .................................. 6.92% 9.82% 81.90% 81.42% 6.92% 9.82% 81.90%
Average Commission Rate Paid ........................ N/A N/A N/A N/A N/A N/A N/A
- -----------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
California Tax-Free Fund
Supplemental information for a share outstanding for the Class A Class B
six month period ended March 31, 1997 or throughout each ------------------------------------------ -----------------------------
fiscal year or period ended September 30. 1997 1996 1995 1994(a) 1997 1996 1995(b)
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value - beginning of period ................... $ 7.93 $ 7.92 $ 7.59 $ 8.50 $ 7.93 $ 7.92 $ 7.35
- -----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income ................................... 0.19 0.40 0.41 0.36 0.17 0.36 0.34
Net realized and unrealized gain (loss) on investments .. (0.02) 0.01 0.33 (0.91) (0.02) 0.01 0.57
- -----------------------------------------------------------------------------------------------------------------------------------
Total from investment operations ..................... 0.17 0.41 0.74 (0.55) 0.15 0.37 0.91
Less distributions:
Distributions from net investment income ................ (0.19) (0.40) (0.41) (0.36) (0.17) (0.36) (0.34)
Distributions from net realized gain (loss) ............. 0.00 0.00 0.00 0.00 0.00 0.00 0.00
- -----------------------------------------------------------------------------------------------------------------------------------
Total distributions .................................. (0.19) (0.40) (0.41) (0.36) (0.17) (0.36) (0.34)
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value ........... (0.02) 0.01 0.33 (0.91) (0.02) 0.01 0.57
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value - end of period ...................... $ 7.91 $ 7.93 $ 7.92 $ 7.59 $ 7.91 $ 7.93 $ 7.92
====================================================================================================================================
Total return (not annualized)(c) ........................ 2.17% 5.23% 10.13% (6.56)% 1.92% 4.70% 12.60%
====================================================================================================================================
Ratios/supplemental data:
Net assets, end of period (000) ......................... $ 21,606 $20,876 $19,292 $ 13,815 $ 4,013 $ 3,159 $ 966
Ratios to average net assets (annualized):
Ratio of net expenses to average net assets(i) .......... 0.50% 0.38% 0.32% 0.25% 1.00% 0.89% 0.84%
Ratio of net investment income to average net assets (ii) 4.82% 4.98% 5.36% 4.70% 4.29% 4.39% 4.47%
(i) Ratio of net expenses to average net assets
prior to waivers and reimbursements (e) .......... 1.29% 1.29% 1.65% 2.01% 2.03% 1.98% 2.97%
(ii) Ratio of net investment income to average net
assets prior to waivers and reimbursements (e) .... 2.01% 4.06% 4.03% 2.94% 1.63% 3.30% 2.35%
Portfolio Turnover ...................................... 9.37% 31.78% 86.69% 73.88% 9.37% 31.78% 86.69%
Average Commission Rate Paid ............................ N/A N/A N/A N/A N/A N/A N/A
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
- ----------
(a) The fund commenced operations on October 19, 1993.
(b) Class B shares were not offered until November 1, 1994.
(c) Total return represents aggregate total return for the period indicated and
does not reflect any applicable sales charge.
(d) The fund was managed by Piper Capital Management, Inc. until December 1,
1994 when Payden & Rygel Investment Counsel assumed management
responsibilities.
(e) Ratio reflects fees reduced in connection with specific agreements only for
periods ended after September 30, 1995.
See accompanying notes to financial statements.
- 29 -
<PAGE>
Notes to Financial Statements (Unaudited)
(1) Significant Accounting Policies
Organization
- ------------
The Griffin Funds, Inc. (the "Company") is registered under the Investment
Company Act of 1940 (the "1940 Act"), as amended, as an open-end management
investment company. As described in note 4, the Money Market and Tax-Free Money
Market Funds are authorized to offer one class of shares, and each of the other
series is authorized to issue shares of two classes: Class A and Class B. The
Company commenced operations on October 19, 1993 and consists of a
non-diversified fund, the California Tax-Free Fund, and eight separate
diversified funds (collectively, the "Funds"):
- - The Money Market Fund
- - The Tax-Free Money Market Fund
- - The Short-Term Bond Fund
- - The U.S. Government Income Fund
- - The Bond Fund
- - The Municipal Bond Fund
- - The Growth & Income Fund
- - The Growth Fund
The Money Market Fund and Tax-Free Money Market Fund commenced offering shares
on October 19, 1993. The U.S. Government Income Fund, Municipal Bond Fund,
California Tax-Free Fund, Bond Fund and Growth & Income Fund commenced offering
Class A shares on October 19, 1993, and offered Class B shares beginning on
November 1, 1994. The Short-Term Bond Fund and Growth Fund commenced offering
Class A shares and Class B shares on June 12, 1995. The two classes of shares
differ principally in their respective sales charges, shareholder servicing fees
and distribution fees. Shareholders of each class may also bear certain expenses
that pertain to each class. All shareholders bear the common expenses of the
Funds, and earn income from the portfolio, pro rata based on the average daily
net assets of each class, without distinction between share classes. Dividends
are declared separately for each class. Gains are allocated to each class pro
rata based upon net assets of each class on the date of distribution. No class
has preferential dividend rights; differences in per share dividend rates are
generally due to differences in separate class expenses, including distribution
and shareholder servicing fees and from relative weightings of pro rata income
and gain allocations. The California Tax-Free Fund concentrates its investments
in a single state and therefore may have more exposure to credit risk related to
the State of California than a fund with a broader geographical diversification.
The following significant accounting policies are consistently followed by the
Company in the preparation of its financial statements, and such policies are in
conformity with generally accepted accounting principles for investment
companies.
Security Valuation
- ------------------
For the funds other than the Money Market Fund and Tax-Free Money Market Fund,
investments in securities for which the primary market is a national securities
exchange or the NASDAQ National Market are stated at the last reported sale
price on the day of valuation or, if no sale has occurred, at the latest quoted
bid price. U.S. Government securities and other securities for which current
over-the-counter market quotations are readily available (excluding debt
securities maturing in 60 days or less) are valued at the closing bid prices. If
quoted prices are unavailable or inaccurate, market values are determined based
on quotes obtained from brokers, dealers and/or based on averages of prices
obtained from independent pricing services. Debt securities maturing in 60 days
or less are generally valued at amortized cost, which approximates market value.
Securities and other assets for which current quotations are not readily
available are valued at fair value as determined in good faith by or under the
direction of the Board of Directors.
The Money Market Fund and Tax-Free Money Market Fund use the amortized cost
method to value their portfolio securities and attempt to maintain constant net
asset values of $1.00 per share. The amortized cost method, which approximates
market value, involves valuing a security at its cost and amortizing any
discount or premium over the period until maturity.
Security Transactions
- ---------------------
The Company records security transactions on the trade date. Dividend income is
recognized on the ex-dividend date, and interest income is recognized on a daily
accru-
- 30 -
<PAGE>
al basis. Realized gains or losses are reported on the basis of identified cost
of securities delivered. Bond discounts and premiums are amortized as required
by the Internal Revenue Code.
Futures Contracts
- -----------------
Each of the Funds except the Money Market Fund and Tax-Free Money Market Fund
may purchase futures contracts to gain exposure to market changes as this may be
more efficient or cost effective than actually buying the securities. A futures
contract is an agreement between two parties to buy and sell a security at a set
price on a future date and is exchange traded. Upon entering into such a
contract, a Fund is required to pledge to the broker an amount of cash, U.S.
Government securities or other high-quality debt securities equal to the minimum
"initial margin" requirements of the exchange. Pursuant to the contract, the
Fund agrees to receive from or pay to the broker an amount of cash equal to the
daily fluctuation in the value of the contract. Such receipts or payments are
known as "variation margin" and are recorded by the fund as unrealized gains or
losses. When the contract is closed, the fund records a realized gain or loss
equal to the difference between the value of the contract at the time it was
opened and the value at the time it was closed. Pursuant to regulations and/or
published positions of the Securities and Exchange Commission, the Fund is
required to segregate cash or high-quality, liquid debt instruments in
connection with futures transactions in an amount generally equal to the entire
value of the underlying contracts. Risks of entering into futures contracts
include the possibility that there may be an illiquid market and that a change
in the value of the contract may not correlate with changes in the value of the
underlying securities. Futures contracts open at year end, if any, are detailed
in the Schedule of Investments for each of the Funds.
Repurchase Agreements
- ---------------------
Transactions involving purchases of securities under agreements to resell
("repurchase agreements") are treated as collateralized financing transactions
and are recorded at their contracted resale amounts. Repurchase agreements, if
any, are detailed in the Schedule of Investments for each of the Funds. The
prospectuses require that repurchase agreements be fully collateralized based on
values that are marked to market daily. The collateral is held by an agent bank
under a tri-party agreement. It is the adviser's responsibility to value
collateral daily and to obtain additional collateral as necessary to maintain
market value equal to or greater than the resale price. The repurchase
agreements held in the Funds at March 31, 1997 are collateralized by U.S.
Treasury or federal agency obligations, and were entered into on March 31, 1997.
Distributions to Shareholders
- -----------------------------
Dividends to shareholders from net investment income are declared daily and
distributed monthly for the Money Market Fund, Tax-Free Money Market Fund,
Short-Term Bond Fund, U.S. Government Income Fund, Municipal Bond Fund,
California Tax-Free Fund and Bond Fund. Dividends to shareholders from the net
investment income of the Growth & Income Fund are declared and distributed
quarterly, and with respect to the Growth Fund, are declared and distributed
annually. Dividends to shareholders are recorded on the ex-dividend date. Each
Fund makes distributions from net realized gains on investments, if any, once a
year.
Federal Income Taxes
- --------------------
The Company's policy for each Fund is to comply with the requirements of the
Internal Revenue Code of 1986, as amended, that are applicable to regulated
investment companies and to distribute substantially all of their taxable income
and any net realized capital gain to its shareholders. Accordingly, no
provisions for income taxes has been made as sufficient distributions were made
or are intended to be made to eliminate taxable income. The following net
capital loss carryforward amounts are available to the funds as of September 30,
1996:
Net Capital Loss Date(s) of
Carryforward Expiration
- -----------------------------------------------------------
Tax-Free Money Market Fund $ 4,664 2004
Short-Term Bond Fund ...... 45,033 2004
Bond Fund ................. 88,015 2003-2004
Municipal Bond Fund ....... 115,227 2003-2004
California Tax-Free Fund .. 440,499 2003
Growth Fund ............... 290,665 2004
Due to the timing of dividend distributions and the differences in accounting
for income and realized gains
- 31 -
<PAGE>
(losses) for financial statement and federal income tax purposes, the fiscal
year in which amounts are distributed may differ from the year in which the
income and realized gains (losses) were recorded by the fund. The differences
between the income or gains distributed on a book versus tax basis, if any, are
shown as excess distributions of net investment income and net realized gain on
sales of investments in the accompanying Statements of Changes in Net Assets.
The Board of Directors will not declare capital gain distributions until the net
capital loss carryforwards have been utilized.
Organization Expenses
- ---------------------
Griffin Financial Administrators ("GFA"), the Funds' administrator, has incurred
expenses in connection with the organization and initial registration of the
Funds. These expenses were charged to the individual Funds and are being
amortized by the Funds on a straight-line basis over 60 months from the date the
Funds commenced operations.
Use of Estimates
- ----------------
The preparation of financial statements in conformity with Generally Accepted
Accounting Principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reported period. Actual
results could differ from those estimates.
(2) Agreements and Other Transactions with Affiliates
The Company has entered into an advisory contract on behalf of the Funds with
Griffin Financial Investment Advisors ("GFIA"). Pursuant to the contract, GFIA
furnishes to the Funds investment guidance and policy direction in connection
with daily portfolio management of the Funds. Under the contract, the Growth &
Income Fund and the Growth Fund pay GFIA a monthly advisory fee calculated by
multiplying each fund's average daily net assets by 0.60% on an annualized
basis. Each of the other Funds pays a monthly advisory fee to GFIA based on an
annualized rate of 0.50% of each Fund's average daily net assets. GFIA has
entered into sub-advisory agreements with Payden & Rygel Investment Counsel
("Payden & Rygel") with respect to the Money Market Fund, Tax-Free Money Market
Fund, U.S. Government Income Fund, Municipal Bond Fund and the California
Tax-Free Fund, with The Boston Company Asset Management, Inc. ("TBCAM") with
respect to the Bond Fund and the Growth & Income Fund, and with T. Rowe Price
Associates, Inc. ("T. Rowe Price") with respect to the Short-Term Bond Fund and
the Growth Fund. Pursuant to such sub-advisory agreements, Payden & Rygel, TBCAM
and T. Rowe Price are primarily responsible for the daily management of the
respective Fund's portfolios. GFIA pays Payden & Rygel, TBCAM and T. Rowe Price
sub-advisory fees for the Funds out of the advisory fees discussed above. For
the six months ended March 31, 1997, GFIA has voluntarily waived all of its fees
to limit fund expenses. For the six months ended March 31, 1997, advisory fees
were incurred by the Funds as follows:
Advisory Waived
Funds fees fees
- --------------------------------------------------------------------------------
Money Market ............................. $486,904 $486,904
Tax-Free Money Market .................... 30,946 30,946
Short-Term Bond .......................... 63,164 63,164
U.S. Government Income ................... 129,541 129,541
Bond ..................................... 83,679 83,679
Municipal Bond ........................... 17,905 17,905
California Tax-Free ...................... 61,944 61,944
Growth & Income .......................... 444,079 444,079
Growth ................................... 95,833 95,833
The Company has entered into contracts on behalf of the Funds with GFA whereby
GFA is responsible for providing administration, custody, transfer agency and
portfolio accounting services for the Funds. GFA is compensated for its services
by each of the Funds on a monthly basis based on an annualized rate of 0.20% of
the Fund's average daily net assets. GFA has waived a portion of its fees to
limit fund expenses. For the six months ended March 31, 1997, administration
fees were incurred by the Funds as follows:
Administration
and Waived
Funds Accounting fees fees
- --------------------------------------------------------------------------------
Money Market ............................. $194,762 $ 0
Tax-Free Money Market .................... 12,378 7,555
Short-Term Bond .......................... 25,266 4,493
U.S. Government Income ................... 51,816 839
Bond ..................................... 33,472 546
Municipal Bond ........................... 7,162 7,162
California Tax-Free ...................... 24,778 4,972
Growth & Income .......................... 148,026 0
Growth ................................... 31,944 508
- 32 -
<PAGE>
In addition, GFA has agreed to reimburse the Funds for certain operating
expenses.
The Company has adopted integrated Distribution and Services Plans pursuant to
Rule 12b-1 under the 1940 Act for the single class of shares of the Money Market
Fund and the Tax-Free Money Market Fund and for the Class A shares of each of
the other Funds. Under these Plans, the Funds may reimburse Griffin Financial
Services ("GFS"), the Funds' distributor, for actual expenses incurred in
preparing and printing prospectuses and other promotional materials for, and for
providing such prospectuses and promotional materials to, prospective
shareholders. Payments under the Plans also may be used to compensate or
reimburse the distributor, selling agents and or servicing agents for
distribution, sales support or shareholder support services. Aggregate payments
under the plans may not exceed, on an annualized basis, 0.20% of the average
daily net assets of the Money Market Fund and the Tax-Free Money Market Fund,
and 0.25% of the average daily net assets of the class A shares of the Non-Money
Market Funds. GFS has waived a portion of its fees to limit fund expenses. For
the period ended March 31, 1997, shares of the Money Market Fund and the
Tax-Free Money Market Fund, and Class A shares of the Non-Money Funds incurred
distribution and services fees as follows:
Distribution and Waived
Funds Servicing Fees Fees
- --------------------------------------------------------------------------------
Money Market ............................. $194,762 $ 0
Tax-Free Money Market .................... 12,378 12,378
Class A Shares
- --------------
Short-Term Bond .......................... 31,330 28,096
U.S. Government Income ................... 60,264 37,173
Bond ..................................... 41,301 31,402
Municipal Bond ........................... 8,455 8,455
California Tax-Free ...................... 26,500 26,244
Growth & Income .......................... 159,947 0
Growth ................................... 36,704 6,913
The Company also has adopted separate Distribution and Services Plans pursuant
to Rule 12b-1 under the 1940 Act for the Class B shares of each of the non-Money
Market Funds. Under the Distribution Plans, the Funds may reimburse GFS for
actual expenses incurred in preparing and printing prospectuses and other
promotional materials for, and providing them to, prospective shareholders.
Payments under the Distribution Plans also may be used to compensate the
distributor, selling agents and/or servicing agents for distribution sales
support or shareholder support services. Payments under the Services Plans are
made to servicing agents that provide shareholder liaison services to Class B
shareholders. Aggregate payments under the Distribution Plans may not exceed
0.75% of the average daily net assets of each Fund on an annual basis. Aggregate
payments under the Services Plans may not exceed, on an annualized basis, 0.25%
of the average daily net assets of each Fund. GFS has waived a portion of its
fees to limit fund expenses. For the period ended March 31, 1997, Class B shares
of the Funds incurred distribution and servicing fees as follows:
Distribution and Waived
Funds Servicing Fees Fees
- --------------------------------------------------------------------------------
Short-Term Bond .......................... $ 1,009 $ 504
U.S. Government Income ................... 18,026 9,013
Bond ..................................... 2,152 1,076
Municipal Bond ........................... 1,992 996
California Tax-Free ...................... 17,888 8,944
Growth & Income .......................... 100,342 25,085
Growth ................................... 12,906 4,205
Reimbursed expenses and waived fees continue at the discretion of the investment
advisor, administrator and distributor. All officers and one director of the
Funds are employees of GFS, but received no compensation from the Company. For
the six months ended March 31, 1997, GFS was paid $113,590 in front-end sales
charges on sales of Class A shares, and $40,184 in contingent deferred sales
charges on Class B share redemptions.
- 33 -
<PAGE>
(3) Purchases and Sales of Securities Exclusive of Short-Term Investments
<TABLE>
<CAPTION>
U.S. California Growth &
Short-Term Government Bond Municipal Tax-Free Income Growth
Bond Fund Income Fund Fund Fund Fund Fund Fund
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Aggregate purchases and sales of:
Common and Preferred Stock:
Purchases at cost ........... $ 0 $ 0 $ 0 $ 0 $ 0 $95,949,669 $18,407,906
Sales proceeds .............. 0 0 0 0 0 60,627,489 3,195,256
U.S. Treasury Obligations:
Purchases at cost ........... 11,907,726 57,311,662 15,739,116 0 0 0 0
Sales proceeds .............. 1,765,099 54,121,385 13,268,669 0 0 0 0
U.S. Agency Securities:
Purchases at cost ........... 1,117,142 26,813,435 4,394,918 0 0 0 0
Sales proceeds .............. 13,810 17,088,737 3,797,540 0 0 0 0
Municipal Bonds:
Purchases at cost ........... 0 0 0 1,242,020 4,993,260 0 0
Sales proceeds .............. 0 0 0 470,151 2,225,955 0 0
Other Long-Term Securities:
Purchases at cost ........... 1,339,930 1,011,434 10,988,524 0 0 0 0
Sales proceeds .............. 448,902 0 3,599,058 0 0 0 0
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
- ----------
All Funds not reflected in this schedule traded exclusively in short-term
securities.
(4) Capital Shares Transactions
As of March 31, 1997, the Company was authorized to issue 10 billion shares of
$0.001 par value capital stock. As of March 31, 1997, each Fund, except the
Money Market Fund and the Tax-Free Money Market Fund, was authorized to issue
250 million shares of $.001 par value capital stock as Class A shares and 250
million shares of $.001 par value capital stock as Class B shares. The Money
Market Fund and the Tax-Free Money Market Fund were each authorized to issue 1
billion shares of $0.001 par value of capital stock of a single class of shares.
Each Non-Money Market fund except the Short-Term Bond Fund and the Growth Fund
issued Class A shares beginning October 19, 1993, and Class B shares beginning
November 1, 1994. The Short-Term Bond Fund and the Growth Fund issued both Class
A shares and Class B shares beginning June 12, 1995. Transactions in capital
shares were as follows:
<TABLE>
<CAPTION>
Tax-Free
Money Market Fund Money Market Fund
--------------------------------------- --------------------------------------
Shares Amount Shares Amount
----------------- ----------------- ---------------- ----------------
<S> <C> <C> <C> <C>
September 30, 1995: 79,956,473 $79,956,473 8,626,128 $8,626,128
Shares sold and exchanged in 237,918,581 237,918,581 15,415,185 15,415,185
Shares issued in reinvestment of dividends 7,146,285 7,146,285 286,582 286,582
Shares redeemed and exchanged out (140,390,420) (140,390,420) (12,671,638) (12,671,638)
----------------- ----------------- ---------------- ----------------
September 30, 1996: 184,630,919 $184,630,919 11,656,257 $11,656,257
Shares sold and exchanged in 166,273,287 166,273,287 7,969,090 7,969,090
Shares issued in reinvestment of dividends 4,504,475 4,504,475 163,756 163,756
Shares redeemed and exchanged out (155,238,872) (155,238,872) (6,171,911) (6,171,911)
----------------- ----------------- ---------------- ---------------
March 31, 1997: 200,169,809 $200,169,809 13,617,192 $13,617,192
================= ================= ================ ================
</TABLE>
- 34 -
<PAGE>
<TABLE>
<CAPTION>
Class A Class B
--------------------------------------- --------------------------------------
Short-Term Bond Fund Shares Amount Shares Amount
----------------- ----------------- ---------------- ----------------
<S> <C> <C> <C> <C>
September 30, 1995: 356,327 $3,571,282 1,313 $13,161
Shares sold and exchanged in 1,789,555 17,982,937 16,811 167,013
Shares issued in reinvestment of dividends 46,463 464,975 220 2,191
Shares redeemed and exchanged out (234,028) (2,338,330) (4,035) (40,096)
----------------- ----------------- ---------------- ----------------
September 30, 1996: 1,958,317 19,680,864 14,309 142,269
Shares sold and exchanged in 1,582,973 15,868,724 15,315 153,227
Shares issued in reinvestment of dividends 58,992 592,398 452 4,531
Shares redeemed and exchanged out (421,533) (4,225,536) (1,396) (14,009)
----------------- ----------------- ---------------- ----------------
March 31, 1997: 3,178,749 $31,916,450 28,680 $286,018
================= ================= ================ ================
<CAPTION>
Class A Class B
--------------------------------------- --------------------------------------
U.S. Government Income Fund Shares Amount Shares Amount
----------------- ----------------- ---------------- ----------------
<S> <C> <C> <C> <C>
September 30, 1995: 3,171,919 $29,004,527 169,102 $1,548,804
Shares sold and exchanged in 2,310,366 21,176,958 262,522 2,434,376
Shares issued in reinvestment of dividends 179,960 1,646,434 8,766 80,124
Shares redeemed and exchanged out (809,554) (7,349,413) (58,923) (534,460)
----------------- ----------------- ---------------- ----------------
September 30, 1996: 4,852,691 44,478,506 381,467 3,528,844
Shares sold and exchanged in 2,192,079 19,827,940 38,865 352,575
Shares issued in reinvestment of dividends 126,396 1,150,191 5,912 53,842
Shares redeemed and exchanged out (753,229) (6,834,174) (29,989) (272,850)
----------------- ----------------- ---------------- ----------------
March 31, 1997: 6,417,937 $58,622,463 396,255 $3,662,411
================= ================= ================ ================
<CAPTION>
Class A Class B
--------------------------------------- --------------------------------------
Bond Fund Shares Amount Shares Amount
----------------- ----------------- ---------------- ----------------
<S> <C> <C> <C> <C>
September 30, 1995: 1,337,451 $11,945,958 16,716 $148,782
Shares sold and exchanged in 2,257,836 20,078,526 42,483 376,231
Shares issued in reinvestment of dividends 105,774 935,074 1,177 10,399
Shares redeemed and exchanged out (512,391) (4,506,778) (12,983) (112,889)
----------------- ----------------- ---------------- ----------------
September 30, 1996: 3,188,670 28,452,780 47,393 422,523
Shares sold and exchanged in 1,715,412 15,111,544 9,462 83,330
Shares issued in reinvestment of dividends 94,003 830,371 979 8,639
Shares redeemed and exchanged out (525,838) (4,632,909) (6,493) (57,131)
----------------- ----------------- ---------------- ----------------
March 31, 1997: 4,472,247 $39,761,786 51,341 $457,361
================= ================= ================ ================
<CAPTION>
Class A Class B
--------------------------------------- --------------------------------------
Municipal Bond Fund Shares Amount Shares Amount
----------------- ----------------- ---------------- ----------------
<S> <C> <C> <C> <C>
September 30, 1995: 614,143 $5,522,331 6,245 $54,697
Shares sold and exchanged in 193,716 1,753,063 53,010 478,805
Shares issued in reinvestment of dividends 20,895 188,802 764 6,853
Shares redeemed and exchanged out (98,330) (879,966) (12,522) (111,458)
----------------- ----------------- ---------------- ----------------
September 30, 1996: 730,424 6,584,230 47,497 428,897
Shares sold and exchanged in 141,129 1,273,335 5,055 45,688
Shares issued in reinvestment of dividends 12,073 109,267 580 5,252
Shares redeemed and exchanged out (97,311) (878,161) (10,327) (92,939)
----------------- ----------------- ---------------- ----------------
March 31, 1997: 786,315 $7,088,671 42,805 $386,898
================= ================= ================ ================
</TABLE>
- 35 -
<PAGE>
<TABLE>
<CAPTION>
Class A Class B
--------------------------------------- --------------------------------------
California Tax-Free Fund Shares Amount Shares Amount
----------------- ----------------- ---------------- ----------------
<S> <C> <C> <C> <C>
September 30, 1995: 2,436,233 $19,430,217 121,916 $954,806
Shares sold and exchanged in 562,419 4,499,150 318,506 2,531,079
Shares issued in reinvestment of dividends 65,286 521,834 6,049 48,127
Shares redeemed and exchanged out (431,734) (3,452,505) (48,248) (382,328)
----------------- ----------------- ---------------- ----------------
September 30, 1996: 2,632,204 20,998,696 398,223 3,151,684
Shares sold and exchanged in 309,064 2,474,109 143,874 1,152,078
Shares issued in reinvestment of dividends 33,874 271,829 5,619 45,109
Shares redeemed and exchanged out (243,755) (1,951,918) (40,531) (325,155)
----------------- ----------------- ---------------- ----------------
March 31, 1997: 2,731,387 $21,792,716 507,185 $4,023,716
================= ================= ================ ================
<CAPTION>
Class A Class B
--------------------------------------- --------------------------------------
Growth & Income Fund Shares Amount Shares Amount
----------------- ----------------- ---------------- ----------------
<S> <C> <C> <C> <C>
September 30, 1995: 2,691,747 $31,965,109 202,018 $2,652,653
Shares sold and exchanged in 4,197,275 63,998,352 847,109 13,004,356
Shares issued in reinvestment of dividends 143,079 2,147,102 12,421 187,362
Shares redeemed and exchanged out (739,537) (11,455,896) (37,209) (576,184)
----------------- ----------------- ---------------- ----------------
September 30, 1996: 6,292,564 86,654,667 1,024,339 15,268,187
Shares sold and exchanged in 2,807,294 47,886,844 339,511 5,796,843
Shares issued in reinvestment of dividends 535,441 8,911,933 80,397 1,334,810
Shares redeemed and exchanged out (922,345) (15,647,261) (48,119) (823,494)
----------------- ----------------- ---------------- ----------------
March 31, 1997: 8,712,954 $127,806,183 1,396,128 $21,576,346
================= ================= ================ ================
<CAPTION>
Class A Class B
--------------------------------------- --------------------------------------
Growth Fund Shares Amount Shares Amount
----------------- ----------------- ---------------- ----------------
<S> <C> <C> <C> <C>
September 30, 1995: 359,063 $3,828,121 12,806 $141,837
Shares sold and exchanged in 1,361,488 17,033,507 152,567 1,954,438
Shares issued in reinvestment of dividends 1,358 15,995 51 600
Shares redeemed and exchanged out (193,632) (2,506,766) (7,077) (91,504)
----------------- ----------------- ---------------- ----------------
September 30, 1996: 1,528,277 18,370,857 158,347 2,005,371
Shares sold and exchanged in 1,471,601 20,213,333 65,530 904,713
Shares issued in reinvestment of dividends 21 286 5 65
Shares redeemed and exchanged out (195,285) (2,692,897) (7,085) (100,356)
----------------- ----------------- ---------------- ----------------
March 31, 1997: 2,804,614 $35,891,579 216,797 $2,809,793
================= ================= ================ ================
</TABLE>
(5) Custodial Earnings Credits
In accordance with the Custody Agreement between the Company and Investors
Fiduciary Trust Company (the "Custodian"), the Custodian provides credits
("Earnings Credits") which are used to offset custodial expenses. These Earnings
Credits are calculated each month by multiplying the average daily cash balance
of each fund by three quarters of a money market rate set by State Street Bank &
Trust Co., the funds' sub-custodian. The amount of such Earnings Credits for
each of the Funds is reflected in the "Expense Reductions" in the Statements of
Operations. Ratios of expenses to average daily net assets shown in the
Financial Highlights are calculated without the Earnings Credits beginning with
the periods ended September 30, 1995.
- 36 -
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The Griffin Funds, Inc.
Board of Directors
Herschel Cardin
Vincent F. Coviello
William A. Hawkins (Chairman)
Carrol R. McGinnis
Morton O. Schapiro
Officers
William A. Hawkins, President
Richie D. Rowsey, Senior Vice President
Julia D. Whitcup, Senior Vice President & Treasurer
Tim S. Glassett, Secretary
Herbert L. Botts, Assistant Secretary
Steven P. Muson, Assistant Treasurer
Henry M. Pena, Assistant Secretary
Darlene L. Spears, Compliance Officer
Diana J. Veloz, Assistant Secretary
Transfer Agent and Custodian
Investors Fiduciary Trust Company (IFTC)
127 West 10th Street
Kansas City, MO 64105-1716
Investment Adviser
Griffin Financial Investment Advisers
5000 Rivergrade Road
Irwindale, CA 91706
Sub-Advisors
Payden & Rygel Investment Counsel
333 South Grand Avenue
Los Angeles, CA 90071
The Boston Company Asset Management, Inc.
One Boston Place
Boston, MA 02108
T. Rowe Price Associates, Inc.
100 East Pratt Street
Baltimore, MD 21202
Legal Counsel
Morrison & Foerster LLP
2000 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
This report and the financial statements contained herein are submitted for the
general information of the shareholders of The Griffin Funds, Inc. If this
report is used for promotional purposes, distribution of the report must be
accompanied or preceded by a current prospectus. The prospectus contains more
detailed information about The Griffin Funds, Inc. Read the prospectus carefully
before you invest or send money.
