the Peachtree Funds
Georgia
Tax-Free
Income Fund
Semi-Annual Report
and Supplement to
Prospectus dated
November 30, 1994
March 31, 1995
Logo
Bank South, N.A.
INVESTMENT ADVISER
3350 CUMBERLAND CIRCLE
ATLANTA, GA 30339
Logo
Federated Securities Corp.
Distributor
A subsidiary of FEDERATED INVESTORS
FEDERATED INVESTORS TOWER
PITTSBURGH, PA 15222-3779
70467H507
G00223-03 (5/95)
PRESIDENT'S MESSAGE
- --------------------------------------------------------------------------------
Dear Shareholder:
I am pleased to present the Semi-Annual Report and Supplement to Prospectus of
the Peachtree Georgia Tax-Free Income Fund (the "Fund") for the reporting period
ended March 31, 1995. This report provides you with complete financial
information for the Fund, including an investment review by the portfolio
manager, a list of investments for the Fund, and the financial statements.
Over the reporting period, assets in the Fund grew to more than $2.2 million.
The Fund paid more than $12,400 in dividends, or $0.18 per share. For the period
ended March 31, 1995, the Fund's average annual total return was (1.54%) based
on offering price.*
Thank you for your confidence in the Peachtree Georgia Tax-Free Income Fund as a
way to take advantage of the potential of municipal bonds. We will continue to
keep you informed about your investment, as we remain committed to delivering
the highest level of personal service.
Sincerely,
Edward C. Gonzales
President
May 8, 1995
* Performance quoted represents past performance. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed,
may be worth more or less than their original cost.
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
During the past six months we have seen the municipal bond market experience a
respectable rally. Yields have fallen approximately 25 basis points on AAA-rated
general obligation bonds maturing in two years. Rates on issues maturing in
three to thirty years fell from 40 to 80 basis points, respectively. While the
municipal market has rallied, it has not kept up with the taxable bond market.
The reason given most often for the municipal bond market not keeping pace is
that investors are becoming more and more concerned about the impact a flat (and
much lower) tax rate will have on the value of municipal bonds. It is true that
discussions of the flat tax issue have occurred before, but the likelihood of a
flat and lower rate structure becoming reality has increased dramatically over
the past few months. We will be keeping an eye on this issue and will report any
points of interest in future commentaries. Our speculation that rates would be
raised in the May Federal Reserve Board meeting seems to be less probable given
most of the weak economic news during the past few weeks. We continue to feel
that overall market yields will meander with the general direction headed lower
as it becomes less and less likely that the Federal Reserve Board will raise
rates any time soon.
A. Please delete the "Summary of Fund Expenses" table on page 1 of the
prospectus and replace it with the following table:
SUMMARY OF FUND EXPENSES
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on Purchases (as a percentage of offering price)................. 2.50%
Maximum Sales Load Imposed on Reinvested Dividends (as a percentage of offering price)...... None
Contingent Deferred Sales Charge (as a percentage of original purchase price
or redemption proceeds, as applicable).................................................... None
Exchange Fee................................................................................ None
ANNUAL FUND OPERATING EXPENSES*
(As a percentage of projected average net assets)
Management Fee (after waiver)(1)............................................................ 0.00%
12b-1 Fees(2)............................................................................... 0.00%
Total Other Expenses (after waivers)(3)..................................................... 0.00%
Shareholder Services Fees(4).............................................................. 0.00%
Total Fund Operating Expenses (after waiver)(5)......................................... 0.00%
</TABLE>
(1) The estimated management fee has been reduced to reflect the anticipated
voluntary waiver by the investment adviser. The investment adviser can terminate
this voluntary waiver at any time in its sole discretion. The maximum management
fee is 0.75%.
(2) The Fund is not paying or accruing 12b-1 fees. The Fund can pay up to 0.75%
as a 12b-1 fee to the distributor. Certain trust clients of the Bank or its
affiliates, including ERISA plans, will not be affected by the distribution plan
because the distribution plan will not be activated unless and until a second,
"Trust," class of shares of the Fund (which would not have a Rule 12b-1 plan) is
created and such trust clients' investments in the Fund are converted to such
Trust class.
(3) Total Other Expenses are estimated to be 2.68% absent the anticipated
voluntary waivers by the administrator and transfer agent and assumption by the
adviser. The administrator, transfer agent, and advisor may terminate those
waivers and assumptions at anytime at their sole discretion.
(4) The Fund is not paying or accruing shareholder services fees. The Fund can
pay up to 0.25% as a shareholder services fee to certain financial institutions.
Certain trust clients of the Bank or its affiliates, including ERISA plans, will
not be affected by the shareholder services plan because the shareholder
services plan will not be activated unless and until a second, "Trust," class of
shares of the Fund (which would not have a services plan) is created and such
clients' investments in the Fund are converted to such Trust class.
(5) The Total Fund Operating Expenses are estimated to be 3.43% absent the
estimated voluntary waivers and assumption by the adviser, administrator, and
transfer agent.
* Expenses are estimated based on average expenses expected to be incurred
during the fiscal year ending September 30, 1995. During the course of this
period, expenses may be more or less than the average amount shown.
THE PURPOSE OF THIS TABLE IS TO ASSIST AN INVESTOR IN UNDERSTANDING THE
VARIOUS COSTS AND EXPENSES THAT A SHAREHOLDER OF THE FUND WILL BEAR, EITHER
DIRECTLY OR INDIRECTLY. FOR MORE COMPLETE DESCRIPTIONS OF THE VARIOUS COSTS AND
EXPENSES, SEE "PEACHTREE FUNDS INFORMATION" AND "INVESTING IN THE FUND."
Wire-transfer redemptions may be subject to an additional fee.
<TABLE>
<CAPTION>
EXAMPLE 1 year 3 years
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
You would pay the following expenses on a $1,000 investment assuming (1) 5% annual return
and (2) redemption at the end of each time period. As noted in the table above, the Fund
charges no redemption fees.............................................................. $ 25 $ 25
</TABLE>
THE ABOVE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR
FUTURE EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN. THIS
EXAMPLE IS BASED ON ESTIMATED DATA FOR THE FUND'S FISCAL YEAR ENDING SEPTEMBER
30, 1995.
B. Please insert the following "Financial Highlights" table as page 2 of the
prospectus, immediately following the "Summary of Fund Expenses" table and
before the section entitled "General Information." In addition, please add
the heading "Financial Highlights" to the Table of Contents page immediately
following the heading "Summary of Fund Expenses."
PEACHTREE GEORGIA TAX-FREE INCOME FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
<TABLE>
<CAPTION>
PERIOD ENDED
MARCH 31, 1995(A)
(UNAUDITED)
- ---------------------------------------------------------------------------------- ------------------
<S> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $10.00
- ----------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS
- ----------------------------------------------------------------------------------
Net investment income 0.18
- ----------------------------------------------------------------------------------
Net realized and unrealized gain (loss) on investments (0.08)
- ---------------------------------------------------------------------------------- ------------
Total from investment operations 0.10
- ----------------------------------------------------------------------------------
LESS DISTRIBUTIONS
- ----------------------------------------------------------------------------------
Distributions from net investment income (0.18)
- ---------------------------------------------------------------------------------- ------------
NET ASSET VALUE, END OF PERIOD $ 9.92
- ---------------------------------------------------------------------------------- ------------
TOTAL RETURN (B) 1.02%
- ----------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
- ----------------------------------------------------------------------------------
Expenses 0.00%(c)
- ----------------------------------------------------------------------------------
Net investment income 4.18%(c)
- ----------------------------------------------------------------------------------
Expense waiver/reimbursement (d) 38.06%(c)
- ----------------------------------------------------------------------------------
SUPPLEMENTAL DATA
- ----------------------------------------------------------------------------------
Net assets, end of period (000 omitted) $2,233
- ----------------------------------------------------------------------------------
Portfolio turnover 56%
- ----------------------------------------------------------------------------------
</TABLE>
(a) Reflects operations for the period from October 6, 1994 (date of initial
public investment) to March 31, 1995.
(b) Based on net asset value, which does not reflect the sales load or
contingent deferred sales charge, if applicable.
(c) Computed on an annualized basis.
(d) This voluntary expense decrease is reflected in both the expense and net
investment income ratios shown above.
(See Notes which are an integral part of the Financial Statements)
C. Please delete the last sentence of the first paragraph in the section
entitled "Voting Rights" on page 17 of the prospectus and insert the
following:
As of May 9, 1995, BHC Securities, Inc., Philadelphia, PA, was the owner of
record of approximately 103,575 shares (38.04%) and Bank South, N.A., Atlanta,
GA, acting in various capacities for numerous accounts, was the owner of record
of approximately 168,685 shares (61.95%), and therefore, may, for certain
purposes, be deemed to control the Fund and be able to affect the outcome of
certain matters presented for a vote of shareholders.
D. Please insert the following financial statements after the section entitled
"Performance Information," which begins on page 20 of the prospectus, and
before the section entitled "Addresses." In addition, please add the heading
"Financial Statements" to the Table of Contents page immediately following
the heading "Performance Information."
PEACHTREE GEORGIA TAX-FREE INCOME FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CREDIT
RATINGS:
PRINCIPAL MOODY'S
AMOUNT OR S&P* VALUE
- --------- ----------------------------------------------------------- ------- ----------
<C> <S> <C> <C>
LONG-TERM MUNICIPAL SECURITIES--94.0%
- ------------------------------------------------------------------------
$ 20,000 Albany, GA, Sewer System, 6.30% Revenue Bonds, (Callable
7/1/2002 @ 102)/(MBIA Insured), 7/1/2003 AAA $ 21,542
-----------------------------------------------------------
5,000 Atlanta, GA, 4.40% GO UT Refunding Bonds, (Callable
12/1/2003 @ 102), 12/1/2004 AA 4,525
-----------------------------------------------------------
5,000 Atlanta, GA, 6.50% GO UT Refunding Bonds, 12/1/1996 AA 5,158
-----------------------------------------------------------
5,000 Atlanta, GA, Airport Extension & Improvements, 5.00%
Revenue Bonds, (Callable 7/1/1995 @ 101 1/2), 1/1/2000 AAA 4,979
-----------------------------------------------------------
5,000 Atlanta, GA, Water & Sewer, 4.10% Refunding Revenue Bonds,
(Original Issue Yield: 4.15%), 1/1/2000 AA 4,731
-----------------------------------------------------------
15,000 Atlanta, GA, Water & Sewer, 4.20% Refunding Revenue Bonds,
(Original Issue Yield: 4.25%), 1/1/2001 AA 14,063
-----------------------------------------------------------
5,000 Augusta-Richmond County, GA, Coliseum Authority, 5.20%
Refunding Revenue Bonds, (Callable 2/1/2003 @ 102)/
(Original Issue Yield: 5.25%), 8/1/2005 A1 4,902
-----------------------------------------------------------
25,000 Bibb County, GA, 4.95% GO UT Bonds, 1/1/2002 AA 24,632
-----------------------------------------------------------
5,000 Bibb County, GA, 5.15% GO UT Bonds, (Callable 1/1/2003 @
102), 1/1/2004 AA 4,930
-----------------------------------------------------------
100,000 Brunswick, GA Water & Sewer Improvements, 6.00% Refunding
Revenue Bonds, (MBIA Insured)/(Original Issue Yield:
6.20%), 10/1/2011 AAA 102,319
-----------------------------------------------------------
5,000 Burke County, GA, Development Authority, 4.50% Pollution
Control Refunding Revenue Bonds, (Oglethorpe Power Corp.)/
(Series B), 1/1/2002 AA- 4,710
-----------------------------------------------------------
</TABLE>
PEACHTREE GEORGIA TAX-FREE INCOME FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CREDIT
RATINGS:
PRINCIPAL MOODY'S
AMOUNT OR S&P* VALUE
- --------- ----------------------------------------------------------- ------- ----------
<C> <S> <C> <C>
LONG-TERM MUNICIPAL SECURITIES--CONTINUED
- ------------------------------------------------------------------------
$ 5,000 Calhoun, GA, Water & Sewer Revenue, 6.00%, 6/1/2000 A $ 4,999
-----------------------------------------------------------
15,000 Carroll City-County Hospital Authority, GA, 7.10% Refunding
RANs, (Tanner Medical Center)/(Callable 7/1/1996 @ 102)/
(MBIA Insured), 7/1/2000 (Partially Prerefunded) AAA 15,766
-----------------------------------------------------------
100,000 Cherokee County, GA, School System, 4.60% GO UT Bonds,
2/1/2001 A1 96,519
-----------------------------------------------------------
15,000 Cherokee County, GA, School System, 7.10% GO UT Bonds,
6/1/1997 A1 15,719
-----------------------------------------------------------
50,000 Clarke County, GA, Hospital Authority, 5.50% Revenue Bonds,
(Regional Medical Center Project)/(Callable 1/1/2003 @
102)/ (MBIA Insured), 1/1/2004 AAA 50,549
-----------------------------------------------------------
40,000 Clayton County, GA, Hospital Authority, 6.50% RANs,
(Southern Regional Medical Center)/(MBIA Insured), 8/1/2000 AAA 42,756
-----------------------------------------------------------
20,000 Cobb County, GA, School District, 4.50% Refunding GO UT
Bonds, (State Aid Withholding)/(Original Issue Yield:
4.60%), 2/1/2000 AA 19,457
-----------------------------------------------------------
5,000 Cobb County, GA, School District, 6.60% GO UT Bonds,
(Callable 2/1/1999 @ 102), 2/1/2000 AA 5,355
-----------------------------------------------------------
25,000 Cobb-Marietta, GA, Coliseum & Exhibit Hall Authority, 6.75%
Revenue Bonds, (Callable 10/1/2001 @ 102)/(MBIA Insured)/
(Original Issue Yield: 6.778%), 10/1/2026 (Prerefunded) AAA 27,751
-----------------------------------------------------------
5,000 Columbus, GA, 3.90% GO UT Bonds, (Sales Tax), 9/1/1998 AA 4,815
-----------------------------------------------------------
15,000 Columbus, GA, 4.20% GO UT Bonds, (Sales Tax)/(Original
Issue Yield: 4.30%), 9/1/2001 AA 14,003
-----------------------------------------------------------
5,000 Columbus, GA, 5.20% GO UT Revenue Bonds, (Sales Tax),
9/1/2000 AA 5,061
-----------------------------------------------------------
15,000 Columbus, GA, Water & Sewer, 6.875% Revenue Bonds,
(Callable 11/1/2001 @ 102)/(Original Issue Yield: 6.93%),
5/1/2020 (Prerefunded) NR 16,741
-----------------------------------------------------------
10,000 Conyers, GA, Water & Sewer, 5.10% Refunding Revenue Bonds,
(AMBAC Insured), 7/1/2000 AAA 10,049
-----------------------------------------------------------
</TABLE>
PEACHTREE GEORGIA TAX-FREE INCOME FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CREDIT
RATINGS:
PRINCIPAL MOODY'S
AMOUNT OR S&P* VALUE
- --------- ----------------------------------------------------------- ------- ----------
<C> <S> <C> <C>
LONG-TERM MUNICIPAL SECURITIES--CONTINUED
- ------------------------------------------------------------------------
$ 5,000 Coweta County, GA, Development Authority, 4.90% GO UT
Refunding & Improvement Revenue Bonds, (Water & Sewer
System Project)/(Series B)/(Callable 6/1/2001 @ 102)/
(Original Issue Yield: 5.00%), 6/1/2003 A $ 4,792
-----------------------------------------------------------
10,000 De Kalb County, GA, Development Authority, 5.00% GO
Refunding Revenue Bonds, (Emroy University Project)/
(Series A)/(Original Issue Yield: 4.90%), 10/1/2000 Aa1 10,029
-----------------------------------------------------------
100,000 De Kalb County, GA, Hospital Authority, 5.00% Refunding
RANs, (De Kalb Medical Center Project)/(Series A)/(Callable
9/1/2003 @ 102)/(MBIA Insured)/(Original Issue Yield:
5.42%), 9/1/2014 AAA 88,826
-----------------------------------------------------------
5,000 De Kalb County, GA, School District, 4.75% GO UT Refunding
Bonds, (Original Issue Yield: 4.899%), 7/1/2001 AA 4,899
-----------------------------------------------------------
5,000 De Kalb County, GA, Water & Sewer, 3.65% Refunding Revenue
Bonds, 10/1/1997 AAA 4,834
-----------------------------------------------------------
100,000 De Kalb County, GA, Water & Sewer, 5.125% Refunding Revenue
Bonds, (Callable 10/1/2003 @ 102)/(Original Issue Yield:
5.324%), 10/1/2014 AAA 90,021
-----------------------------------------------------------
20,000 Douglas County, GA, School District, 6.60% GO UT Refunding
Bonds, (Callable 1/1/1996 @ 102), 1/1/2000 A+ 20,694
-----------------------------------------------------------
5,000 Downtown Savannah Authority, GA, 4.25% Refunding Revenue
Bonds, (Board of Public Education Project)/(MBIA Insured)/
(Original Issue Yield: 4.35%), 8/1/1999 AAA 4,827
-----------------------------------------------------------
5,000 Downtown Savannah Authority, GA, 4.50% Refunding Revenue
Bonds, (Chatham County Projects)/(Series A)/(Original Issue
Yield: 4.65%), 1/1/2002 AA 4,729
-----------------------------------------------------------
25,000 Downtown Savannah Authority, GA, 6.625% GO UT Bonds,
(Stormwater Capital Improvement Project)/(Series A)/
(Callable 8/1/1998 @ 102), 8/1/2003 AA 26,465
-----------------------------------------------------------
5,000 Floyd County, GA, Hospital Authority, 4.70% Refunding RANs,
(Floyd Medical Center)/(FGIC Insured)/(Original Issue
Yield: 4.80%), 7/1/2002 AAA 4,772
-----------------------------------------------------------
</TABLE>
PEACHTREE GEORGIA TAX-FREE INCOME FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CREDIT
RATINGS:
PRINCIPAL MOODY'S
AMOUNT OR S&P* VALUE
- --------- ----------------------------------------------------------- ------- ----------
<C> <S> <C> <C>
LONG-TERM MUNICIPAL SECURITIES--CONTINUED
- ------------------------------------------------------------------------
$ 5,000 Floyd County, GA, Hospital Authority, 4.80% Refunding RANs,
(Floyd Medical Center)/(FGIC Insured)/(Original Issue
Yield: 4.90%), 7/1/2003 AAA $ 4,767
-----------------------------------------------------------
100,000 Fulton County, GA, 6.00% GO UT Bonds, (Callable 1/1/1996 @
102), 1/1/2005 AA 102,000
-----------------------------------------------------------
25,000 Fulton County, GA, Building Authority, 5.30% Refunding
Revenue Bonds, (Judicial Center Facilities Project),
1/1/1996 AA 25,185
-----------------------------------------------------------
25,000 Fulton County, GA, Building Authority, 5.70% Refunding
Revenue Bonds, (County Government & Health Facilities
Project)/(Series A)/(Callable 1/1/2003 @ 102)/(Original
Issue Yield: 5.80%), 1/1/2004 AA 25,638
-----------------------------------------------------------
5,000 Fulton County, GA, Hospital Authority, 4.40% RANs,
(Northside Hospital)/(Series B)/(MBIA Insured)/(Original
Issue Yield: 4.50%), 10/1/2000 AAA 4,767
-----------------------------------------------------------
50,000 Fulton County, GA, School District, 5.625% GO UT Bonds,
(Callable 1/1/2004 @ 102)/(Original Issue Yield: 5.85%),
1/1/2021 AA 47,177
-----------------------------------------------------------
25,000 Fulton County, GA, School District, 6.00% GO UT Refunding
Bonds, 5/1/2002 AA 26,353
-----------------------------------------------------------
5,000 Fulton County, GA, Water & Sewer, 6.60% Revenue Bonds,
(Series 1986)/(Callable 5/26/1995 @ 102), 1/1/2000 AAA 5,341
-----------------------------------------------------------
5,000 Fulton De Kalb, GA, Hospital Authority, 5.10% GO UT
Refunding Revenue Bonds, (MBIA Insured)/(Original Issue
Yield: 5.15%), 1/1/2002 AAA 4,980
-----------------------------------------------------------
5,000 Fulton De Kalb, GA, Hospital Authority, 6.50% Revenue
Bonds, (Grady Memorial Hospital)/(Callable 1/1/2001 @ 102)/
(AMBAC Insured), 1/1/2003 (Prerefunded) AAA 5,438
-----------------------------------------------------------
10,000 Georgia State Municipal Electric Power Authority, 4.40% GO
Refunding Revenue Bonds, (Series Z)/(Original Issue Yield:
4.50%), 1/1/1999 A+ 9,611
-----------------------------------------------------------
15,000 Georgia State Municipal Electric Power Authority, 4.50% GO
Revenue Bonds, (Series AA), 1/1/1997 A+ 14,844
-----------------------------------------------------------
10,000 Georgia State Tollway Authority, 6.25% Revenue Bonds,
(Georgia 400 Project)/(State Guaranteed), 7/1/1998 AAA 10,470
-----------------------------------------------------------
</TABLE>
PEACHTREE GEORGIA TAX-FREE INCOME FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CREDIT
RATINGS:
PRINCIPAL MOODY'S
AMOUNT OR S&P* VALUE
- --------- ----------------------------------------------------------- ------- ----------
<C> <S> <C> <C>
LONG-TERM MUNICIPAL SECURITIES--CONTINUED
- ------------------------------------------------------------------------
$ 40,000 Georgia State, 5.50% GO UT Refunding Bonds, (Series E),
7/1/2003 AAA $ 41,144
-----------------------------------------------------------
50,000 Georgia State, 6.50% GO UT Bonds, (Series C), 7/1/1996 AAA 51,247
-----------------------------------------------------------
15,000 Georgia State, 6.50% GO UT Bonds, (Series C), 7/1/1998 AAA 15,836
-----------------------------------------------------------
5,000 Georgia State, 6.80% GO UT Bonds, (Series D), 8/1/1999 AAA 5,397
-----------------------------------------------------------
5,000 Georgia State, 7.00% GO UT Bonds, (Series D), 11/1/1996 AAA 5,191
-----------------------------------------------------------
25,000 Georgia State, 7.40% GO UT Bonds, (Series D), 8/1/1997 AAA 26,581
-----------------------------------------------------------
10,000 Gwinnett County, GA, School District, 4.40% GO UT Refunding
Bonds, 2/1/1999 AA 9,785
-----------------------------------------------------------
10,000 Gwinnett County, GA, School District, 4.50% GO UT Refunding
Bonds, (Callable 2/1/2002 @ 102), 2/1/2003 AA 9,370
-----------------------------------------------------------
5,000 Gwinnett County, GA, School District, 4.50% GO UT Refunding
Bonds, 2/1/2002 AA 4,751
-----------------------------------------------------------
40,000 Gwinnett County, GA, Water & Sewer, 4.60% Refunding Revenue
Bonds, (Original Issue Yield: 4.699%), 8/1/2000 AA+ 39,092
-----------------------------------------------------------
5,000 Henry County, GA, School District, 5.30% GO UT Refunding
Bonds, (Series B), 8/1/1999 A+ 5,085
-----------------------------------------------------------
50,000 La Grange, GA, Development Authority, IDR 5.625%, (General
Signal Corp.)/(Callable 6/1/1995 @ 101.4), 12/1/2002 A2 49,339
-----------------------------------------------------------
10,000 La Grange, GA, Water & Sewer, 4.70% Refunding Revenue
Bonds, (Original Issue Yield: 4.80%), 1/1/2003 A 9,524
-----------------------------------------------------------
25,000 La Grange, GA, Water & Sewer, 5.10% Refunding Revenue
Bonds, (Callable 1/1/2003 @ 102)/(AMBAC Insured)/ (Original
Issue Yield: 5.20%), 1/1/2007 AAA 23,848
-----------------------------------------------------------
30,000 La Grange, GA, Water & Sewer, 5.25% Refunding Revenue
Bonds, (Callable 1/1/2003 @ 102)/(Original Issue Yield:
5.50%), 1/1/2012 A 27,344
-----------------------------------------------------------
15,000 Macon Bibb County, GA, IDR 5.05% Refunding Bonds,
(Series B), 9/1/2000 AA 14,999
-----------------------------------------------------------
35,000 Macon Bibb County, GA, IDR 6.95% Refunding Bonds, (Parking
Facilities Project)/(Callable 8/1/2000 @ 102), 8/1/2003 AA 38,127
-----------------------------------------------------------
</TABLE>
PEACHTREE GEORGIA TAX-FREE INCOME FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CREDIT
RATINGS:
PRINCIPAL MOODY'S
AMOUNT OR S&P* VALUE
- --------- ----------------------------------------------------------- ------- ----------
<C> <S> <C> <C>
LONG-TERM MUNICIPAL SECURITIES--CONTINUED
- ------------------------------------------------------------------------
$ 15,000 Macon, GA, Lease, 4.30% Revenue Bonds, (School District
Project)/(Series A), 10/1/2000 AA $ 14,101
-----------------------------------------------------------
100,000 Macon, GA, Water & Sewer, 4.20% Revenue Bonds, 10/1/1995 A+ 99,843
-----------------------------------------------------------
15,000 Marietta, GA, 5.00% GO UT Refunding Bonds, 1/1/2001 A+ 14,940
-----------------------------------------------------------
50,000 Metro Atlanta Rapid Transit Authority, GA, 4.90% Sales Tax
Refunding Revenue Bonds, (Second Indenture Series)/
(Series A)/(AMBAC Insured), 7/1/2001 AAA 49,361
-----------------------------------------------------------
10,000 Metro Atlanta Rapid Transit Authority, GA, 6.05% Sales Tax
Refunding Revenue Bonds, (Series M)/(Original Issue Yield:
6.15%), 7/1/2001 AA- 10,464
-----------------------------------------------------------
40,000 Metro Atlanta Rapid Transit Authority, GA, 7.00% Sales Tax
Revenue Bonds, (Callable 5/31/1995 @ 100)/(Original Issue
Yield: 9.75%), 7/1/2011 Escrowed to Maturity AAA 43,979
-----------------------------------------------------------
25,000 Private Colleges & Universities Authority, GA, 4.65%
Refunding Revenue Bonds, (Agnes Scott College
Project)/(Original Issue Yield: 4.75%), 6/1/2002 AA- 24,054
-----------------------------------------------------------
85,000 Private Colleges & University Facilities Authority, GA,
4.60% GO Refunding Revenue Bonds, (Emory University
Project)/ (Series C), 10/1/1995 Aa1 85,115
-----------------------------------------------------------
25,000 Richmond County, GA, Board of Education, 4.70% GO UT
Refunding Bonds, (Callable 11/1/2003 @ 102)/(FGIC Insured)/
(Original Issue Yield: 4.75%), 11/1/2005 AAA 23,051
-----------------------------------------------------------
100,000 Rome, GA, New Public Housing Authority, 5.00% Revenue
Bonds, (Callable 8/1/1995 @ 103)/(U.S. Government
Guaranteed), 8/1/2004 AAA 98,892
-----------------------------------------------------------
5,000 Savannah, GA, Hospital Authority, 8.00% Revenue Bonds, (St.
Joseph's Hospital Project)/(Callable 7/1/1998 @ 102),
7/1/2003 (Prerefunded) A 5,557
-----------------------------------------------------------
50,000 Valdosta & Lowndes County, GA, Hospital Authority, 5.50%
Refunding Revenue Bonds, (South Georgia Medical Center
Project)/(MBIA Insured)/(Original Issue Yield: 5.60%),
10/1/2006 AAA 49,958
-----------------------------------------------------------
</TABLE>
PEACHTREE GEORGIA TAX-FREE INCOME FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CREDIT
RATINGS:
PRINCIPAL MOODY'S
AMOUNT OR S&P* VALUE
- --------- ----------------------------------------------------------- ------- ----------
<C> <S> <C> <C>
LONG-TERM MUNICIPAL SECURITIES--CONTINUED
- ------------------------------------------------------------------------
$ 15,000 Valdosta & Lowndes County, GA, Hospital Authority, 5.70%
Refunding Revenue Bonds, (South Georgia Medical Center
Project)/(MBIA Insured)/(Original Issue Yield: 5.80%),
10/1/2008 AAA $ 15,042
-----------------------------------------------------------
85,000 Valdosta & Lowndes County, GA, Hospital Authority, 5.45%
Refunding Revenue Bonds, (South Georgia Medical Center
Project)/(MBIA Insured)/(Original Issue Yield: 5.50%),
10/1/2005 AAA 85,134
-----------------------------------------------------------
25,000 Valdosta, GA, Water & Sewer, 5.80% Revenue Bonds,
(Callable 9/1/1995 @ 102), 9/1/2000 A+ 25,628
----------------------------------------------------------- ----------
TOTAL INVESTMENTS (IDENTIFIED COST, $2,082,432) $2,099,269+
----------------------------------------------------------- ----------
</TABLE>
+ The cost of investments for federal tax purposes amounts to $2,082,432. The
net unrealized appreciation of investments on a federal tax basis amounts to
$16,837, which is comprised of $23,897 appreciation and $7,060 depreciation at
March 31, 1995.
* Please refer to the Appendix of the Statement of Additional Information for an
explanation of the credit ratings. Current credit ratings are unaudited.
Note: The categories of investments are shown as a percentage of net assets
($2,232,657) at March 31, 1995.
The following abbreviations are used throughout this portfolio:
<TABLE>
<S> <C>
AMBAC -- American Municipal Bond Assurance Corporation
FGIC -- Financial Guaranty Insurance Company
GO -- General Obligation
IDR -- Industrial Development Revenue
MBIA -- Municipal Bond Investors Assurance
RANs -- Revenue Anticipation Notes
UT -- Unlimited Tax
</TABLE>
(See Notes which are an integral part of the Financial Statements)
PEACHTREE GEORGIA TAX-FREE INCOME FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
ASSETS:
- ---------------------------------------------------------------------------------
Investments in securities, at value (identified and tax cost $2,082,432) $2,099,269
- ---------------------------------------------------------------------------------
Cash 151,198
- ---------------------------------------------------------------------------------
Income receivable 34,158
- ---------------------------------------------------------------------------------
Receivable for investments sold 117,000
- ---------------------------------------------------------------------------------
Receivable for shares sold 16,184
- --------------------------------------------------------------------------------- ----------
Total assets 2,417,809
- ---------------------------------------------------------------------------------
LIABILITIES:
- ---------------------------------------------------------------------------------
Payable for investments purchased $104,584
- ----------------------------------------------------------------------
Income distribution payable 5,050
- ----------------------------------------------------------------------
Accrued expenses 75,518
- ---------------------------------------------------------------------- --------
Total liabilities 185,152
- --------------------------------------------------------------------------------- ----------
Net Assets for 225,058 shares outstanding $2,232,657
- --------------------------------------------------------------------------------- ----------
NET ASSETS CONSISTS OF:
- ---------------------------------------------------------------------------------
Paid in capital $2,215,825
- ---------------------------------------------------------------------------------
Net unrealized appreciation of investments 16,837
- ---------------------------------------------------------------------------------
Accumulated net realized loss on investments (5)
- --------------------------------------------------------------------------------- ----------
Total Net Assets $2,232,657
- --------------------------------------------------------------------------------- ----------
NET ASSET VALUE, Offering Price and Redemption Proceeds Per Share:
Net Asset Value Per Share ($2,232,657 / 225,058 shares outstanding) $9.92
- ---------------------------------------------------------------------------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
PEACHTREE GEORGIA TAX-FREE INCOME FUND
STATEMENT OF OPERATIONS
PERIOD ENDED MARCH 31, 1995*
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C>
INVESTMENT INCOME:
- ------------------------------------------------------------------------------------------
Interest $ 12,477
- ------------------------------------------------------------------------------------------
EXPENSES:
- ------------------------------------------------------------------------------------------
Investment advisory fee $ 2,237
- -------------------------------------------------------------------------------
Administrative personnel and services fee 49,864
- -------------------------------------------------------------------------------
Custodian fees 3,595
- -------------------------------------------------------------------------------
Transfer agent and dividend disbursing agent fees and expenses 8,689
- -------------------------------------------------------------------------------
Directors'/Trustees' fees 500
- -------------------------------------------------------------------------------
Auditing fees 601
- -------------------------------------------------------------------------------
Legal fees 1,301
- -------------------------------------------------------------------------------
Portfolio accounting fees 26,727
- -------------------------------------------------------------------------------
Share registration costs 12,266
- -------------------------------------------------------------------------------
Printing and postage 2,994
- -------------------------------------------------------------------------------
Insurance premiums 1,747
- -------------------------------------------------------------------------------
Miscellaneous 2,994
- ------------------------------------------------------------------------------- -------
Total expenses 113,515
- -------------------------------------------------------------------------------
Deduct--
- -------------------------------------------------------------------------------
Waiver of investment advisory fee $ 2,237
- ---------------------------------------------------------------------
Waiver of administration personnel and services fee 24,932
- ---------------------------------------------------------------------
Reimbursement of other operating expenses 86,346
- --------------------------------------------------------------------- -------
Total waivers/reimbursements 113,515
- ------------------------------------------------------------------------------- -------
Net expenses 0
- ------------------------------------------------------------------------------------------ --------
Net investment income 12,477
- ------------------------------------------------------------------------------------------ --------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
- ------------------------------------------------------------------------------------------
Net realized loss on investments (5)
- ------------------------------------------------------------------------------------------
Net change in unrealized appreciation of investments 16,837
- ------------------------------------------------------------------------------------------ --------
Net realized and unrealized gain on investments 16,832
- ------------------------------------------------------------------------------------------ --------
Change in net assets resulting from operations $ 29,309
- ------------------------------------------------------------------------------------------ --------
</TABLE>
* For the period from October 6, 1994 (date of initial public investment) to
March 31, 1995.
(See Notes which are an integral part of the Financial Statements)
PEACHTREE GEORGIA TAX-FREE INCOME FUND
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PERIOD ENDED
MARCH 31, 1995*
(UNAUDITED)
---------------
<S> <C>
INCREASE (DECREASE) IN NET ASSETS:
- --------------------------------------------------------------------------
OPERATIONS--
- --------------------------------------------------------------------------
Net investment income $ 12,477
- --------------------------------------------------------------------------
Net realized loss on investments ($5 net loss as computed for
federal tax purposes) (5)
- --------------------------------------------------------------------------
Net change in unrealized appreciation of investments 16,837
- -------------------------------------------------------------------------- -------------
Change in net assets resulting from operations 29,309
- -------------------------------------------------------------------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS--
- --------------------------------------------------------------------------
Distributions from net investment income (12,477)
- -------------------------------------------------------------------------- -------------
SHARE TRANSACTIONS--
- --------------------------------------------------------------------------
Proceeds from sale of shares 2,240,769
- --------------------------------------------------------------------------
Net asset value of shares issued to shareholders in payment of
distributions declared 5,384
- --------------------------------------------------------------------------
Cost of shares redeemed (30,328)
- -------------------------------------------------------------------------- -------------
Change in net assets resulting from share transactions 2,215,825
- -------------------------------------------------------------------------- -------------
Change in net assets 2,232,657
- --------------------------------------------------------------------------
NET ASSETS:
- --------------------------------------------------------------------------
Beginning of period --
- -------------------------------------------------------------------------- -------------
End of period $ 2,232,657
- -------------------------------------------------------------------------- -------------
</TABLE>
* For the period from October 6, 1994 (date of initial public investment) to
March 31, 1995.
(See Notes which are an integral part of the Financial Statements)
PEACHTREE GEORGIA TAX-FREE INCOME FUND
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
(1) ORGANIZATION
Peachtree Funds (the "Trust") is registered under the Investment Company Act of
1940, as amended (the "Act"), as an open-end management investment company. The
Trust consists of four diversified portfolios and one non-diversified portfolio.
The financial statements included herein present only those of Peachtree Georgia
Tax-Free Income Fund (the "Fund"). The financial statements of the other
portfolios are presented separately. The assets of each portfolio are segregated
and a shareholder's interest is limited to the portfolio in which shares are
held.
(2) SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. These
policies are in conformity with generally accepted accounting principles.
INVESTMENT VALUATIONS--Municipal bonds are valued by an independent pricing
service, taking into consideration yield, liquidity, risk, credit quality,
coupon, maturity, type of issue, and any other factors or market data the
pricing service deems relevant in determining valuations for normal
institutional size trading units of debt securities. The independent
pricing service does not rely exclusively on quoted prices. Short-term
securities with the remaining maturities of sixty days or less at the time
of purchase may be valued at amortized cost, which approximates fair market
value.
REPURCHASE AGREEMENTS--It is the policy of the Fund to require the
custodian bank to take possession, to have legally segregated in the
Federal Reserve Book Entry System, or to have segregated within the
custodian bank's vault, all securities held as collateral under repurchase
agreement transactions. Additionally, procedures have been established by
the Fund to monitor, on a daily basis, the market value of each repurchase
agreement's collateral to ensure that the value of collateral at least
equals the repurchase price to be paid under the repurchase agreement
transaction.
The Fund will only enter into repurchase agreements with banks and other
recognized financial institutions, such as broker/dealers, which are deemed
by the Fund's adviser to be creditworthy pursuant to the guidelines and/or
standards reviewed or established by the Board of Trustees (the
"Trustees").
Risks may arise from the potential inability of counterparties to honor the
terms of the repurchase agreement. Accordingly, the Fund could receive less
than the repurchase price on the sale of collateral securities.
PEACHTREE GEORGIA TAX-FREE INCOME FUND
- --------------------------------------------------------------------------------
INVESTMENT INCOME, EXPENSES AND DISTRIBUTIONS--Interest income and expenses
are accrued daily. Bond premium and discount, if applicable, are amortized
as required by the Internal Revenue Code, as amended (the "Code").
Distributions to shareholders are recorded on the ex-dividend date.
FEDERAL TAXES--It is the Fund's policy to comply with the provisions of the
Code applicable to regulated investment companies and to distribute to
shareholders each year substantially all of its income. Accordingly, no
provisions for federal tax are necessary.
WHEN-ISSUED AND DELAYED DELIVERY TRANSACTIONS--The Fund may engage in
when-issued or delayed delivery transactions. The Fund records when-issued
securities on the trade date and maintains security positions such that
sufficient liquid assets will be available to make payment for the
securities purchased. Securities purchased on a when-issued or delayed
delivery basis are marked to market daily and begin earning interest on the
settlement date.
DEFERRED EXPENSES--The costs incurred by the Fund with respect to
registration of its shares in its first fiscal year, excluding the initial
expense of registering the shares, have been deferred and are being
amortized using the straight-line method not to exceed a period of five
years from the Fund's commencement date.
OTHER--Investment transactions are accounted for on the trade date.
(3) SHARES OF BENEFICIAL INTEREST
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value).
Transactions in shares were as follows:
<TABLE>
<CAPTION>
PERIOD ENDED
MARCH 31,
1995*
--------------
<S> <C>
- ---------------------------------------------------------------------------
Shares sold 227,587
- ---------------------------------------------------------------------------
Shares issued to shareholders in payment of distributions declared 544
- ---------------------------------------------------------------------------
Shares redeemed (3,073)
- --------------------------------------------------------------------------- ------------
Net change resulting from share transactions 225,058
- --------------------------------------------------------------------------- ------------
</TABLE>
* For the period from October 6, 1994 (date of initial public investment) to
March 31, 1995.
(4) INVESTMENT ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY FEE--Bank South, N.A., the Fund's investment adviser (the
"Adviser"), receives for its services an annual investment advisory fee equal to
.75 of 1% of the Fund's average daily net assets. The Adviser may voluntarily
choose to waive any portion of its fee and reimburse certain
PEACHTREE GEORGIA TAX-FREE INCOME FUND
- --------------------------------------------------------------------------------
operating expenses of the Fund. The Adviser can modify or terminate this
voluntary waiver and reimbursement at any time at its sole discretion.
ADMINISTRATIVE FEE--Federated Administrative Services ("FAS") provides the Trust
with certain administrative personnel and services. The FAS fee is based on the
level of average aggregate net assets of the Trust for the period. FAS may
voluntarily choose to waive a portion of its fee.
TRANSFER AND DIVIDEND DISBURSING AGENT AND PORTFOLIO ACCOUNTING FEES--Federated
Services Company ("FServ") serves as transfer and dividend disbursing agent for
the Fund. The fee is based on the size, type, and number of accounts and
transactions made by shareholders.
FServ also maintains the Fund's accounting records for which it receives a fee.
The fee is based on the level of the Fund's average net assets for the period,
plus out-of-pocket expenses.
ORGANIZATIONAL EXPENSES--Organizational expenses incurred by the Fund will be
borne initially by FAS and are estimated to be $40,000. The Fund has agreed to
reimburse FAS for organizational expenses during the five year period following
January 7, 1994 (date the Fund became effective). For the period ended March 31,
1995, the Fund paid $1,333 pursuant to this agreement.
GENERAL--Certain of the Officers and Trustees of the Trust are Officers and
Directors or Trustees of the above companies.
(5) INVESTMENT TRANSACTIONS
Purchases and sales of investments, excluding short-term securities, for the
period ended March 31, 1995, were as follows:
<TABLE>
<S> <C>
- --------------------------------------------------------------------------------
PURCHASES $2,399,183
- -------------------------------------------------------------------------------- ----------
SALES $ 315,901
- -------------------------------------------------------------------------------- ----------
</TABLE>
March 31, 1995
<TABLE>
<S> <C>
TRUSTEES OFFICERS
- -----------------------------------------------------------------------------
John F. Donahue John F. Donahue
Thomas G. Bigley Chairman
John T. Conroy, Jr. Edward C. Gonzales
William J. Copeland President and Treasurer
James E. Dowd Charles L. Davis, Jr.
Lawrence D. Ellis, M.D. Vice President and Assistant Treasurer
Edward L. Flaherty, Jr. J. Christopher Donahue
Edward C. Gonzales Vice President
Peter E. Madden Richard B. Fisher
Gregor F. Meyer Vice President
John E. Murray, Jr. John W. McGonigle
Wesley W. Posvar Vice President and Secretary
Marjorie P. Smuts David M. Taylor
Assistant Treasurer
C. Grant Anderson
Assistant Secretary
</TABLE>
the Peachtree Funds
Equity
Fund
Semi-Annual Report
March 31, 1995
Logo
Bank South, N.A.
INVESTMENT ADVISER
3350 CUMBERLAND CIRCLE
ATLANTA, GA 30339
Logo
Federated Securities Corp.
Distributor
A subsidiary of FEDERATED INVESTORS
FEDERATED INVESTORS TOWER
PITTSBURGH, PA 15222-3779
70467H101
G00223-02 (5/95)
PRESIDENT'S MESSAGE
- --------------------------------------------------------------------------------
Dear Shareholder:
I am pleased to present the Semi-Annual Report of the Peachtree Equity Fund (the
"Fund") for the six-month period ended March 31, 1995. This report provides you
with complete financial information for the Fund, including an investment review
by the portfolio manager, a list of investments for the Fund, and the financial
statements.
Over the six-month reporting period, assets in the Fund grew to more than $103.3
million. The Fund paid more than $712,000 in dividends, or $0.07 per share.
Thank you for your confidence in the Peachtree Equity Fund as a way to take
advantage of the potential of stocks. We will continue to keep you informed
about your investment, as we remain committed to delivering the highest level of
personal service.
Sincerely,
Edward C. Gonzales
President
May 8, 1995
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
The stock market provided some relief from the dismal 1994 fourth quarter and
year as the first quarter in 1995 was the best in about four years. The Standard
& Poor's 500 index--a common proxy for the U.S. stock market--had a total return
of 9.72% during the last six months, all of which was made during the 1995 first
quarter. The Fund's average annual total return for the same period was 3.45%
based on the offering price which includes the sales load.* As many investors
shifted emphasis toward large capitalization growth stocks, the Fund retained a
higher exposure to cyclical issues and average weightings in technology and
health care, which performed quite well.
Investors seemed to focus on the recent failure of the Federal Reserve Board to
raise short-term interest rates for the eighth time as a sign that the economy
was slowing and that a soft landing was now probable. With slower but positive
growth being projected, we do not see inflation as being a problem for now, and
corporate earnings are expected to be in a positive range of 9%-11% for the
year. After the impressive first quarter performance, some adjustment may be in
order; however, we believe the stock market can continue to advance to new highs
later this year. As such, we plan to use any periodic market weakness as an
opportunity to buy those stocks that our analysis show are undervalued with
long-term growth potential.
* Performance quoted represents past performance. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed,
may be worth more or less than their original cost.
PEACHTREE EQUITY FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES VALUE
- ----------- ----------------------------------------------------------------- ------------
<C> <S> <C> <C>
COMMON STOCKS--97.3%
- ----------------------------------------------------------------------------------
AEROSPACE & DEFENSE--3.9%
-----------------------------------------------------------------
20,000 Boeing Co. $ 1,077,500
-----------------------------------------------------------------
30,000 General Motors Corp., Class H 1,237,500
-----------------------------------------------------------------
40,000 Loral Corp. 1,700,000
----------------------------------------------------------------- ------------
Total 4,015,000
----------------------------------------------------------------- ------------
AUTOMOTIVE--7.2%
-----------------------------------------------------------------
30,000 Chrysler Corp. 1,256,250
-----------------------------------------------------------------
32,000 Eaton Corp. 1,736,000
-----------------------------------------------------------------
45,000 Echlin, Inc. 1,732,500
-----------------------------------------------------------------
25,000 General Motors Corp. 1,106,250
-----------------------------------------------------------------
62,000 Superior Industries International, Inc. 1,581,000
----------------------------------------------------------------- ------------
Total 7,412,000
----------------------------------------------------------------- ------------
BUILDING--1.6%
-----------------------------------------------------------------
35,000 Masco Corp. 966,875
-----------------------------------------------------------------
45,000 Ryland Group, Inc. 646,875
----------------------------------------------------------------- ------------
Total 1,613,750
----------------------------------------------------------------- ------------
CHEMICALS--2.8%
-----------------------------------------------------------------
20,000 Eastman Chemical Co. 1,112,500
-----------------------------------------------------------------
21,000 Imperial Chemical Industries PLC, ADR 987,000
-----------------------------------------------------------------
40,000 R.P.M. Inc., Ohio 795,000
----------------------------------------------------------------- ------------
Total 2,894,500
----------------------------------------------------------------- ------------
ELECTRICAL EQUIPMENT--3.8%
-----------------------------------------------------------------
20,000 Andrew Corp.* 815,000
-----------------------------------------------------------------
23,000 Emerson Electric Co. 1,529,500
-----------------------------------------------------------------
30,000 General Electric Co. 1,623,750
----------------------------------------------------------------- ------------
Total 3,968,250
----------------------------------------------------------------- ------------
</TABLE>
PEACHTREE EQUITY FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES VALUE
- ----------- ----------------------------------------------------------------- ------------
<C> <S> <C> <C>
COMMON STOCKS--CONTINUED
- ----------------------------------------------------------------------------------
ELECTRICAL OFFICE EQUIPMENT--8.7%
-----------------------------------------------------------------
48,000 American Business Products, Inc. $ 1,254,000
-----------------------------------------------------------------
12,000 Hewlett Packard Co. 1,444,500
-----------------------------------------------------------------
15,000 Intel Corp. 1,273,124
-----------------------------------------------------------------
18,000 Lotus Development Corp.* 688,500
-----------------------------------------------------------------
10,000 Microsoft Corp. 711,250
-----------------------------------------------------------------
20,000 Motorola, Inc. 1,092,500
-----------------------------------------------------------------
28,000 Texas Instruments, Inc. 2,478,000
----------------------------------------------------------------- ------------
Total 8,941,874
----------------------------------------------------------------- ------------
ENERGY--8.9%
-----------------------------------------------------------------
21,000 Amerada Hess Corp. 1,036,875
-----------------------------------------------------------------
25,000 Amoco Corp. 1,590,625
-----------------------------------------------------------------
23,000 Anadarko Petroleum Corp. 1,006,250
-----------------------------------------------------------------
35,000 Baker Hughes, Inc. 713,125
-----------------------------------------------------------------
32,000 Equitable Resource, Inc. 892,000
-----------------------------------------------------------------
20,000 Mapco, Inc. 1,115,000
-----------------------------------------------------------------
15,000 Royal Dutch Petroleum Co. 1,800,000
-----------------------------------------------------------------
18,000 Schlumberger Ltd. 1,073,250
----------------------------------------------------------------- ------------
Total 9,227,125
----------------------------------------------------------------- ------------
FINANCE--3.8%
-----------------------------------------------------------------
33,000 Barnett Banks, Inc. 1,501,500
-----------------------------------------------------------------
25,000 Capital One Financial Corp. 478,125
-----------------------------------------------------------------
10,000 Federal National Mortgage Association 813,750
-----------------------------------------------------------------
25,000 Signet Banking Corp. 509,375
-----------------------------------------------------------------
15,000 Torchmark, Inc. 622,500
----------------------------------------------------------------- ------------
Total 3,925,250
----------------------------------------------------------------- ------------
</TABLE>
PEACHTREE EQUITY FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES VALUE
- ----------- ----------------------------------------------------------------- ------------
<C> <S> <C> <C>
COMMON STOCKS--CONTINUED
- ----------------------------------------------------------------------------------
FINANCE-COMMERCIAL--4.4%
-----------------------------------------------------------------
30,000 American Express Co. $ 1,046,250
-----------------------------------------------------------------
10,000 Chubb Corp. 790,000
-----------------------------------------------------------------
22,000 Morgan (J. P.) & Co., Inc. 1,342,000
-----------------------------------------------------------------
25,000 Suntrust Banks, Inc. 1,337,500
----------------------------------------------------------------- ------------
Total 4,515,750
----------------------------------------------------------------- ------------
FOOD, BEVERAGES & HOUSEHOLD PRODUCTS--9.4%
-----------------------------------------------------------------
20,000 Anheuser-Busch Companies, Inc. 1,172,500
-----------------------------------------------------------------
110,000 Archer-Daniels-Midland Co. 2,048,750
-----------------------------------------------------------------
58,000 Flowers Industries, Inc. 1,044,000
-----------------------------------------------------------------
17,000 Gillette Co. 1,387,625
-----------------------------------------------------------------
23,000 IBP, Inc. 750,375
-----------------------------------------------------------------
27,000 PepsiCo, Inc. 1,053,000
-----------------------------------------------------------------
20,000 Philip Morris Companies, Inc. 1,305,000
-----------------------------------------------------------------
37,000 Sara Lee Corp. 966,625
----------------------------------------------------------------- ------------
Total 9,727,875
----------------------------------------------------------------- ------------
FOREST PRODUCTS--1.5%
-----------------------------------------------------------------
41,000 Weyerhaeuser Co. 1,593,875
----------------------------------------------------------------- ------------
HEALTH CARE--9.1%
-----------------------------------------------------------------
35,000 Abbott Laboratories 1,246,875
-----------------------------------------------------------------
23,000 Bausch & Lomb, Inc. 822,250
-----------------------------------------------------------------
11,000 Bristol-Myers Squibb Co. 693,000
-----------------------------------------------------------------
16,000 Forest Labs, Inc. * 762,000
-----------------------------------------------------------------
25,000 Merck & Co., Inc. 1,065,625
-----------------------------------------------------------------
30,000 Mylan Labs, Inc. 952,500
-----------------------------------------------------------------
9,000 Pfizer, Inc. 771,750
-----------------------------------------------------------------
20,000 Scherer R.P. Corp. * 1,005,000
-----------------------------------------------------------------
</TABLE>
PEACHTREE EQUITY FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES VALUE
- ----------- ----------------------------------------------------------------- ------------
<C> <S> <C> <C>
COMMON STOCKS--CONTINUED
- ----------------------------------------------------------------------------------
HEALTH CARE--CONTINUED
-----------------------------------------------------------------
30,000 Smithkline Beecham PLC, ADR $ 1,125,000
-----------------------------------------------------------------
22,000 U.S. Healthcare, Inc. 973,500
----------------------------------------------------------------- ------------
Total 9,417,500
----------------------------------------------------------------- ------------
MACHINERY-INDUSTRIAL--3.3%
-----------------------------------------------------------------
35,000 AGCO Corp. 1,159,375
-----------------------------------------------------------------
40,000 Caterpillar, Inc. 2,225,000
----------------------------------------------------------------- ------------
Total 3,384,375
----------------------------------------------------------------- ------------
MEDIA--2.3%
-----------------------------------------------------------------
16,408 Cox Communications, Inc. 274,834
-----------------------------------------------------------------
38,000 Reuters Holdings PLC, ADR 1,748,000
-----------------------------------------------------------------
21,008 Times Mirror Co. 404,401
----------------------------------------------------------------- ------------
Total 2,427,235
----------------------------------------------------------------- ------------
METALS--2.5%
-----------------------------------------------------------------
32,000 Aluminum Co. of America 1,324,000
-----------------------------------------------------------------
22,000 Nucor Corp. 1,237,500
----------------------------------------------------------------- ------------
Total 2,561,500
----------------------------------------------------------------- ------------
MOVIES-ENTERTAINMENT--4.7%
-----------------------------------------------------------------
40,000 Harley Davidson, Inc. 960,000
-----------------------------------------------------------------
20,000 Hilton Hotels Corp. 1,482,500
-----------------------------------------------------------------
52,000 McDonalds Corp. 1,774,500
-----------------------------------------------------------------
15,153 Viacom, Inc. 678,097
----------------------------------------------------------------- ------------
Total 4,895,097
----------------------------------------------------------------- ------------
MISCELLANEOUS--2.2%
-----------------------------------------------------------------
12,000 Millipore Corp. 669,000
-----------------------------------------------------------------
33,000 Tenneco, Inc. 1,555,125
----------------------------------------------------------------- ------------
Total 2,224,125
----------------------------------------------------------------- ------------
</TABLE>
PEACHTREE EQUITY FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES VALUE
- ----------- ----------------------------------------------------------------- ------------
<C> <S> <C> <C>
COMMON STOCKS--CONTINUED
- ----------------------------------------------------------------------------------
RETAIL TRADE--8.8%
-----------------------------------------------------------------
45,000 Autozone, Inc.* $ 1,119,375
-----------------------------------------------------------------
55,000 Circuit City Stores, Inc. 1,450,625
-----------------------------------------------------------------
26,000 Home Depot, Inc. 1,150,500
-----------------------------------------------------------------
35,000 K Mart Corp. 481,250
-----------------------------------------------------------------
50,000 Limited, Inc. 1,156,250
-----------------------------------------------------------------
30,000 Office Depot, Inc.* 731,250
-----------------------------------------------------------------
31,000 Penney (J.C.) Co., Inc. 1,391,125
-----------------------------------------------------------------
10,000 Tandy Corp. 477,500
-----------------------------------------------------------------
20,000 Toys R Us, Inc.* 512,500
-----------------------------------------------------------------
25,000 Wal-Mart Stores, Inc. 637,500
----------------------------------------------------------------- ------------
Total 9,107,875
----------------------------------------------------------------- ------------
SERVICES--1.3%
-----------------------------------------------------------------
50,000 WMX Technologies, Inc. 1,375,000
----------------------------------------------------------------- ------------
TRANSPORTATION--1.9%
-----------------------------------------------------------------
60,000 Atlantic Southeast Airlines 1,110,000
-----------------------------------------------------------------
45,000 Southwest Airlines Co. 804,375
----------------------------------------------------------------- ------------
Total 1,914,375
----------------------------------------------------------------- ------------
UTILITIES--5.2%
-----------------------------------------------------------------
20,000 AT&T Corp. 1,035,000
-----------------------------------------------------------------
15,000 Duke Power Co. 577,500
-----------------------------------------------------------------
60,000 LDDS Communications, Inc.* 1,402,500
-----------------------------------------------------------------
60,000 MCI Communications Corp. 1,237,500
-----------------------------------------------------------------
40,000 Telefonos De Mexico S.A. de C.V., ADR 1,140,000
----------------------------------------------------------------- ------------
Total 5,392,500
----------------------------------------------------------------- ------------
TOTAL COMMON STOCKS (IDENTIFIED COST $96,859,880) 100,534,831
----------------------------------------------------------------- ------------
</TABLE>
PEACHTREE EQUITY FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
OR SHARES VALUE
- ----------- ----------------------------------------------------------------- ------------
<C> <S> <C> <C>
PREFERRED STOCK--0.2%
- ----------------------------------------------------------------------------------
MEDIA--0.2%
-----------------------------------------------------------------
8,992 Times Mirror Co. (identified cost $225,103) $ 192,208
----------------------------------------------------------------- ------------
CASH EQUIVALENT--0.07%
- ----------------------------------------------------------------------------------
$ 74,343 Bank of New York Cash Reserve, 5.30% 74,343
----------------------------------------------------------------- ------------
**REPURCHASE AGREEMENTS--3.1%
- ----------------------------------------------------------------------------------
1,700,000 Lehman Brothers, Inc., 6.15%, dated 3/31/1995, due 4/4/1995 1,700,000
-----------------------------------------------------------------
1,500,000 Prudential Securities, Inc., 6.07%, dated 3/30/1995, due 4/3/1995 1,500,000
----------------------------------------------------------------- ------------
TOTAL REPURCHASE AGREEMENTS (AT AMORTIZED COST) 3,200,000
----------------------------------------------------------------- ------------
TOTAL INVESTMENTS (IDENTIFIED COST $100,359,326) $104,001,382+
----------------------------------------------------------------- ------------
</TABLE>
* Non-income producing security.
** The repurchase agreements are fully collateralized by U.S. government and/or
agency obligations based on market prices at the date of the portfolio.
+ The cost of investments for federal tax purposes amounts to $100,359,326. The
unrealized appreciation of investments on a federal tax basis amounts to
$3,642,056, which is comprised of $9,355,906 appreciation and $5,713,850
depreciation at March 31, 1995.
Note: The categories of investments are shown as a percentage of net assets
($103,365,095) at March 31, 1995.
The following abbreviation is used throughout this portfolio:
ADR--American Depositary Receipt
(See Notes which are an integral part of the Financial Statements)
PEACHTREE EQUITY FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
ASSETS:
- -------------------------------------------------------------------------------
Investments in securities, at value (identified and tax cost $100,359,326) $104,001,382
- -------------------------------------------------------------------------------
Income receivable 211,239
- -------------------------------------------------------------------------------
Receivable for shares sold 55,877
- -------------------------------------------------------------------------------
Deferred expenses 29,218
- ------------------------------------------------------------------------------- ------------
Total assets 104,297,716
- -------------------------------------------------------------------------------
LIABILITIES:
- -------------------------------------------------------------------------------
Payable for investments purchased $896,601
- --------------------------------------------------------------------
Payable for shares redeemed 16,945
- --------------------------------------------------------------------
Accrued expenses 19,075
- -------------------------------------------------------------------- --------
Total liabilities 932,621
- ------------------------------------------------------------------------------- ------------
Net Assets for 9,881,422 shares outstanding $103,365,095
- ------------------------------------------------------------------------------- ------------
NET ASSETS CONSISTS OF:
- -------------------------------------------------------------------------------
Paid in capital $ 98,227,245
- -------------------------------------------------------------------------------
Net unrealized appreciation of investments 3,642,056
- -------------------------------------------------------------------------------
Accumulated net realized gain on investments 1,472,537
- -------------------------------------------------------------------------------
Undistributed net investment income 23,257
- ------------------------------------------------------------------------------- ------------
Total Net Assets $103,365,095
- ------------------------------------------------------------------------------- ------------
NET ASSET VALUE, Offering Price and Redemption Proceeds Per Share:
Net Asset Value Per Share ($103,365,095 / 9,881,422 shares outstanding) $10.46
- -------------------------------------------------------------------------------
Offering Price Per Share (100/96.25 of $10.46)* $10.87
- -------------------------------------------------------------------------------
</TABLE>
* See "What Shares Cost" in the Prospectus.
(See Notes which are an integral part of the Financial Statements)
PEACHTREE EQUITY FUND
STATEMENT OF OPERATIONS
SIX MONTHS ENDED MARCH 31, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
- ---------------------------------------------------------------------------------
Interest $ 217,140
- ---------------------------------------------------------------------------------
Dividends 998,431
- --------------------------------------------------------------------------------- ----------
Total income 1,215,571
- ---------------------------------------------------------------------------------
EXPENSES:
- ---------------------------------------------------------------------------------
Investment advisory fee $370,599
- ----------------------------------------------------------------------
Administrative personnel and services fee 70,731
- ----------------------------------------------------------------------
Custodian fees 15,058
- ----------------------------------------------------------------------
Transfer agent and dividend disbursing agent fees and expenses 24,304
- ----------------------------------------------------------------------
Directors'/Trustees' fees 1,439
- ----------------------------------------------------------------------
Auditing fees 5,279
- ----------------------------------------------------------------------
Legal fees 3,563
- ----------------------------------------------------------------------
Portfolio accounting fees 23,263
- ----------------------------------------------------------------------
Share registration costs 17,119
- ----------------------------------------------------------------------
Printing and postage 8,080
- ----------------------------------------------------------------------
Insurance premiums 3,119
- ----------------------------------------------------------------------
Miscellaneous 3,785
- ---------------------------------------------------------------------- --------
Total expenses 546,339
- ----------------------------------------------------------------------
Deduct --Waiver of investment advisory fee 50,797
- ---------------------------------------------------------------------- --------
Net expenses 495,542
- --------------------------------------------------------------------------------- ----------
Net investment income 720,029
- --------------------------------------------------------------------------------- ----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
- ---------------------------------------------------------------------------------
Net realized gain on investments 1,473,519
- ---------------------------------------------------------------------------------
Net change in unrealized appreciation of investments 3,711,516
- --------------------------------------------------------------------------------- ----------
Net realized and unrealized gain on investments 5,185,035
- --------------------------------------------------------------------------------- ----------
Change in net assets resulting from operations $5,905,064
- --------------------------------------------------------------------------------- ----------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
PEACHTREE EQUITY FUND
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS
ENDED PERIOD ENDED
MARCH 31, 1995 SEPTEMBER 30,
(UNAUDITED) 1994*
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
- ----------------------------------------------------------
OPERATIONS--
- ----------------------------------------------------------
Net investment income $ 720,029 $ 849,966
- ----------------------------------------------------------
Net realized gain on investments ($1,473,519 net gain and
$0, respectively, as computed for federal tax purposes) 1,473,519 46,181
- ----------------------------------------------------------
Net change in unrealized appreciation (depreciation) 3,711,516 (69,459)
- ---------------------------------------------------------- ------------- --------------
Change in net assets resulting from operations 5,905,064 826,688
- ---------------------------------------------------------- ------------- --------------
DISTRIBUTIONS TO SHAREHOLDERS--
- ----------------------------------------------------------
Distributions from net investment income (712,413) (834,325)
- ----------------------------------------------------------
Distributions from net realized gains (47,164) --
- ---------------------------------------------------------- ------------- --------------
Change in net assets resulting from distributions to
shareholders (759,577) (834,325)
- ---------------------------------------------------------- ------------- --------------
SHARE TRANSACTIONS--
- ----------------------------------------------------------
Proceeds from sale of shares 19,465,343 105,207,396
- ----------------------------------------------------------
Net asset value of shares issued to shareholders in
payment of distributions declared 670,323 809,821
- ----------------------------------------------------------
Cost of shares redeemed (18,712,545) (9,213,093)
- ---------------------------------------------------------- ------------- --------------
Change in net assets resulting from share
transactions 1,423,121 96,804,124
- ---------------------------------------------------------- ------------- --------------
Change in net assets 6,568,608 96,796,487
- ----------------------------------------------------------
NET ASSETS:
- ----------------------------------------------------------
Beginning of period 96,796,487 --
- ---------------------------------------------------------- ------------- --------------
End of period (including undistributed net investment
income of $23,257 and $15,641, respectively) $103,365,095 $ 96,796,487
- ---------------------------------------------------------- ------------- --------------
</TABLE>
* For the period from February 14, 1994 (date of initial public investment) to
September 30, 1994.
(See Notes which are an integral part of the Financial Statements)
PEACHTREE EQUITY FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
<TABLE>
<CAPTION>
SIX MONTHS PERIOD
ENDED ENDED
MARCH 31, 1995 SEPTEMBER 30,
(UNAUDITED) 1994(A)
-------------- -------------
<S> <C> <C>
- -------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 9.92 $10.00
- -------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS
- -------------------------------------------------------------------
Net investment income 0.07 0.10
- -------------------------------------------------------------------
Net realized and unrealized gain (loss) on investments 0.55 (0.08)
- ------------------------------------------------------------------- ---------- ---------
Total from investment operations 0.62 0.02
- -------------------------------------------------------------------
LESS DISTRIBUTIONS
- -------------------------------------------------------------------
Distributions from net investment income (0.07) (0.10)
- -------------------------------------------------------------------
Distributions from net realized gain on investment transactions (0.01) 0.00
- ------------------------------------------------------------------- ---------- ---------
Total distributions (0.08) (0.10)
- ------------------------------------------------------------------- ---------- ---------
NET ASSET VALUE, END OF PERIOD $10.46 $ 9.92
- ------------------------------------------------------------------- ---------- ---------
TOTAL RETURN (B) 6.24% 0.20%
- -------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
- -------------------------------------------------------------------
Expenses 1.00%(c) 0.96%(c)
- -------------------------------------------------------------------
Net investment income 1.45%(c) 1.66%(c)
- -------------------------------------------------------------------
Expense waiver/reimbursement (d) 0.10%(c) 0.09%(c)
- -------------------------------------------------------------------
SUPPLEMENTAL DATA
- -------------------------------------------------------------------
Net assets, end of period (000 omitted) $103,365 $96,796
- -------------------------------------------------------------------
Portfolio turnover 9% 4%
- -------------------------------------------------------------------
</TABLE>
(a) Reflects operations for the period from February 14, 1994 (date of initial
public investment) to
September 30, 1994.
(b) Based on net asset value, which does not reflect the sales load or
contingent deferred sales charge, if applicable.
(c) Computed on an annualized basis.
(d) This voluntary expense decrease is reflected in both the expense and net
investment income ratios shown above.
(See Notes which are an integral part of the Financial Statements)
PEACHTREE EQUITY FUND
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
(1) ORGANIZATION
Peachtree Funds (the "Trust") is registered under the Investment Company Act of
1940, as amended (the "Act"), as an open-end management investment company. The
Trust consists of four diversified portfolios and one non-diversified portfolio.
The financial statements presented herein present only those of Peachtree Equity
Fund (the "Fund"). The financial statements of the other portfolios are
presented separately. The assets of each portfolio are segregated and a
shareholder's interest is limited to the portfolio in which shares are held.
(2) SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. These
policies are in conformity with generally accepted accounting principles.
INVESTMENT VALUATIONS--Listed equity securities are valued at the last sale
price reported on national securities exchanges. Unlisted securities and
short-term securities are generally valued at the prices provided by an
independent pricing service. Short-term securities with remaining
maturities of sixty days or less at the time of purchase may be valued at
amortized cost, which approximates fair market value.
REPURCHASE AGREEMENTS--It is the policy of the Fund to require the
custodian bank to take possession, to have legally segregated in the
Federal Reserve Book Entry System, or to have segregated within the
custodian bank's vault, all securities held as collateral under repurchase
agreement transactions. Additionally, procedures have been established by
the Fund to monitor, on a daily basis, the market value of each repurchase
agreement's collateral to ensure that the value of collateral at least
equals the repurchase price to be paid under the repurchase agreement
transaction.
The Fund will only enter into repurchase agreements with banks and other
recognized financial institutions, such as broker/dealers, which are deemed
by the Fund's adviser to be creditworthy pursuant to the guidelines and/or
standards reviewed or established by the Board of Trustees (the
"Trustees").
Risks may arise from the potential inability of counterparties to honor the
terms of the repurchase agreement. Accordingly, the Fund could receive less
than the repurchase price on the sale of collateral securities.
INVESTMENT INCOME, EXPENSES AND DISTRIBUTIONS--Dividend income and
distributions to shareholders are recorded on the ex-dividend date.
Interest income and expenses are accrued daily.
PEACHTREE EQUITY FUND
- --------------------------------------------------------------------------------
Bond premium and discount, if applicable, are amortized as required by the
Internal Revenue Code, as amended (the "Code").
FEDERAL TAXES--It is the Fund's policy to comply with the provisions of the
Code applicable to regulated investment companies and to distribute to
shareholders each year substantially all of its income. Accordingly, no
provisions for federal tax are necessary.
WHEN-ISSUED AND DELAYED DELIVERY TRANSACTIONS--The Fund may engage in
when-issued or delayed delivery transactions. The Fund records when-issued
securities on the trade date and maintains security positions such that
sufficient liquid assets will be available to make payment for the
securities purchased. Securities purchased on a when-issued or delayed
delivery basis are marked to market daily and begin earning interest on the
settlement date.
DEFERRED EXPENSES--The costs incurred by the Fund with respect to
registration of its shares in its first fiscal year, excluding the initial
expense of registering the shares, have been deferred and are being
amortized using the straight-line method not to exceed a period of five
years from the Fund's commencement date.
OTHER--Investment transactions are accounted for on the trade date.
(3) SHARES OF BENEFICIAL INTEREST
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value).
Transactions in shares were as follows:
<TABLE>
<CAPTION>
SIX MONTHS PERIOD ENDED
ENDED SEPTEMBER 30,
MARCH 31, 1995 1994*
- ---------------------------------------------------------- -------------- -------------
<S> <C> <C>
Shares sold 1,962,079 10,619,487
- ----------------------------------------------------------
Shares issued to shareholders in payment of
dividends declared 67,844 82,917
- ----------------------------------------------------------
Shares redeemed (1,903,118) (947,787)
- ---------------------------------------------------------- ------------- ------------
Net change resulting from share transactions 126,805 9,754,617
- ---------------------------------------------------------- ------------- ------------
</TABLE>
*For the period from February 14, 1994 (date of initial public investment) to
September 30, 1994.
(4) INVESTMENT ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY FEE--Bank South, N.A., the Fund's investment adviser
(the "Adviser"), receives for its services an annual investment advisory
fee equal to .75 of 1% of the Fund's average daily net assets. The Adviser
may voluntarily choose to waive a portion of its fee. The Adviser can
modify or terminate this voluntary waiver at any time at its sole
discretion.
PEACHTREE EQUITY FUND
- --------------------------------------------------------------------------------
ADMINISTRATIVE FEE--Federated Administrative Services ("FAS") provides the
Fund with certain administrative personnel and services. The FAS fee is
based on the level of average aggregate net assets of the Fund for the
period. FAS may voluntarily choose to waive a portion of its fee.
TRANSFER AND DIVIDEND DISBURSING AGENT AND PORTFOLIO ACCOUNTING
FEES--Federated Services Company ("FServ") serves as transfer and dividend
disbursing agent for the Fund. The fee is based on the size, type, and
number of accounts and transactions made by shareholders.
FServ also maintains the accounting records for which it receives a fee.
The fee is based on the level of the Fund's average net assets for the
period, plus out-of-pocket expenses.
ORGANIZATIONAL EXPENSES--Organizational expenses ($41,462) were initially
borne by FAS. The Fund has agreed to reimburse FAS for the organizational
expenses during the five year period following January 7, 1994 (the date
the Fund became effective). For the period ended March 31, 1995, the Fund
paid $1,022 pursuant to this agreement.
GENERAL--Certain of the Officers and Trustees of the Trust are Officers and
Directors or Trustees of the above companies.
(5) INVESTMENT TRANSACTIONS
Purchases and sales of investments, excluding short-term securities, for the
period ended March 31, 1995, were as follows:
PEACHTREE EQUITY FUND
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
- ----------------------------------------------------------
PURCHASES $17,627,085
- ---------------------------------------------------------- ------------
SALES $8,198,255
- ---------------------------------------------------------- ------------
</TABLE>
<TABLE>
<S> <C>
TRUSTEES OFFICERS
- -----------------------------------------------------------------------------
John F. Donahue John F. Donahue
Thomas G. Bigley Chairman
John T. Conroy, Jr. Edward C. Gonzales
William J. Copeland President and Treasurer
James E. Dowd Charles L. Davis, Jr.
Lawrence D. Ellis, M.D. Vice President and Assistant Treasurer
Edward L. Flaherty, Jr. J. Christopher Donahue
Edward C. Gonzales Vice President
Peter E. Madden Richard B. Fisher
Gregor F. Meyer Vice President
John E. Murray, Jr. John W. McGonigle
Wesley W. Posvar Vice President and Secretary
Marjorie P. Smuts David M. Taylor
Assistant Treasurer
C. Grant Anderson
Assistant Secretary
</TABLE>
the Peachtree Funds
Bond
Fund
Semi-Annual Report
March 31, 1995
Logo
Bank South, N.A.
INVESTMENT ADVISER
3350 CUMBERLAND CIRCLE
ATLANTA, GA 30339
Logo
Federated Securities Corp.
Distributor
A subsidiary of FEDERATED INVESTORS
FEDERATED INVESTORS TOWER
PITTSBURGH, PA 15222-3779
70467H200
G00223-01 (5/95)
PRESIDENT'S MESSAGE
- --------------------------------------------------------------------------------
Dear Shareholder:
I am pleased to present the Semi-Annual Report of the Peachtree Bond Fund (the
"Fund") for the six-month period ended March 31, 1995. This report provides you
with complete financial information for the Fund, including an investment review
by the portfolio manager, a list of investments for the Fund, and the financial
statements.
Over the six-month reporting period, assets in the Fund grew to more than $82.7
million. The Fund paid more than $2.4 million in dividends, or $0.28 per share.
For the period ended March 31, 1995, the Fund's average annual total return was
1.00%, based on offering price.*
Thank you for your confidence in the Peachtree Bond Fund as a way to put your
money to work earning income. We will continue to keep you informed about your
investment, as we remain committed to delivering the highest level of personal
service.
Sincerely,
Edward C. Gonzales
President
May 8, 1995
* Performance quoted represents past performance. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed,
may be worth more or less than their original cost.
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
During the past six months we have seen the bond market rally and recover from
some of the damage done during the last quarter of 1993 and most of 1994. Yields
have fallen approximately 25 basis points on U.S. Treasury notes maturing in one
year. Rates on issues maturing in two to thirty years fell from 75 to 120 basis
points, respectively. Our speculation that the Federal Reserve Board (the "Fed")
would raise rates once more during the first half of 1995 seems to be less
probable given most of the weak economic news during the past few weeks. We
continue to feel that overall market yields will meander with the general
direction headed lower as it becomes less and less likely that the Fed will
raise rates any time soon. As we have for the past several weeks, all cash
inflows will be used to purchase longer maturity issues.
PEACHTREE BOND FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- ------------------------------------------------------------------ -----------
<C> <C> <S> <C>
CORPORATE BONDS--43.5%
- -------------------------------------------------------------------------------------
AEROSPACE--3.5%
------------------------------------------------------------------
$ 1,000,000 Boeing Co., 6.35%, 6/15/2003 $ 926,330
------------------------------------------------------------------
1,000,000 Rockwell International Corp., 8.375%, 2/15/2001 1,041,250
------------------------------------------------------------------
1,000,000 Rockwell International Corp., 6.75%, 9/15/2002 955,320
------------------------------------------------------------------ -----------
Total 2,922,900
------------------------------------------------------------------ -----------
BANKING--2.6%
------------------------------------------------------------------
1,000,000 Fleet Norstar Financial Group, 7.25%, 9/1/1999 984,450
------------------------------------------------------------------
500,000 Suntrust Banks, Inc., 8.875%, 2/1/1998 517,615
------------------------------------------------------------------
650,000 Wachovia Bank, Medium Term Notes, 4.25%, 9/20/1996 623,812
------------------------------------------------------------------ -----------
Total 2,125,877
------------------------------------------------------------------ -----------
BEVERAGES--0.6%
------------------------------------------------------------------
500,000 Pepsico, Inc., 7.75%, 10/1/1998 506,885
------------------------------------------------------------------ -----------
CHEMICALS--0.6%
------------------------------------------------------------------
500,000 du Pont (E.I.) de Nemours & Co., 8.45%, 10/15/1996 510,570
------------------------------------------------------------------ -----------
DATA PROCESSING--1.1%
------------------------------------------------------------------
1,000,000 International Business Machines, 6.375%, 6/15/2000 953,060
------------------------------------------------------------------ -----------
ENERGY--0.7%
------------------------------------------------------------------
500,000 BP America, Inc., 9.375%, 11/1/2000 541,055
------------------------------------------------------------------ -----------
</TABLE>
PEACHTREE BOND FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- ------------------------------------------------------------------ -----------
<C> <C> <S> <C>
CORPORATE BONDS--CONTINUED
- -------------------------------------------------------------------------------------
FINANCE--17.7%
------------------------------------------------------------------
$ 500,000 American Express Co., 8.75%, 6/15/1996 $ 510,300
------------------------------------------------------------------
3,500,000 CIT Group Holdings, Inc., 7.625%, 12/5/1996 3,527,545
------------------------------------------------------------------
1,000,000 Exxon Capital Corp., 7.875%, 8/15/1997 1,015,820
------------------------------------------------------------------
1,500,000 Ford Motor Credit Co., 7.75%, 10/1/1999 1,508,625
------------------------------------------------------------------
500,000 General Electric Capital Corp., 8.75%, 11/26/1996 512,715
------------------------------------------------------------------
1,000,000 General Electric Capital Corp., 8.00%, 2/1/1997 1,016,080
------------------------------------------------------------------
2,000,000 International Lease Finance Co., Medium Term Notes, 7.35%,
11/28/1995 2,014,740
------------------------------------------------------------------
1,500,000 International Lease Finance Co., 5.75%, 1/15/1996 1,489,320
------------------------------------------------------------------
500,000 Norwest Financial, Inc., 8.37%, 1/15/2000 515,280
------------------------------------------------------------------
1,000,000 Potomac Capital, Medium Term Notes, 8.65%, 10/3/1998 1,030,600
------------------------------------------------------------------
1,000,000 Transamerica Finance Corp., 8.125%, 10/15/1996 1,013,320
------------------------------------------------------------------
500,000 U.S. West Capital Funding, Inc., 8.00%, 10/15/1996 507,015
------------------------------------------------------------------ -----------
Total 14,661,360
------------------------------------------------------------------ -----------
FOOD--1.2%
------------------------------------------------------------------
1,000,000 Heinz (H. J.) Co., 6.75%, 10/15/1999 974,330
------------------------------------------------------------------ -----------
HEALTH CARE--1.2%
------------------------------------------------------------------
1,000,000 Lilly (Eli) & Co., 6.75%, 11/15/1999 975,540
------------------------------------------------------------------ -----------
POLLUTION CONTROL--2.4%
------------------------------------------------------------------
1,000,000 Waste Management, Inc., 6.25%, 12/15/1995 998,070
------------------------------------------------------------------
1,000,000 Waste Management, Inc., 6.375%, 7/1/1997 982,830
------------------------------------------------------------------ -----------
Total 1,980,900
------------------------------------------------------------------ -----------
RETAIL--1.3%
------------------------------------------------------------------
500,000 Wal-Mart Stores, Inc., 9.10%, 7/15/2000 533,330
------------------------------------------------------------------
500,000 Wal-Mart Stores, Inc., 8.625%, 4/1/2001 525,485
------------------------------------------------------------------ -----------
Total 1,058,815
------------------------------------------------------------------ -----------
</TABLE>
PEACHTREE BOND FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- ------------------------------------------------------------------ -----------
<C> <C> <S> <C>
CORPORATE BONDS--CONTINUED
- -------------------------------------------------------------------------------------
SECURITIES--7.1%
------------------------------------------------------------------
$ 500,000 Lehman Brothers Holdings, Inc., 7.00%, 5/15/1997 $ 490,655
------------------------------------------------------------------
2,000,000 Lehman Brothers Holdings, Inc., 8.875%, 11/1/1998 2,043,760
------------------------------------------------------------------
2,000,000 Merrill Lynch & Co., 7.75%, 3/1/1999 1,998,180
------------------------------------------------------------------
1,500,000 Salomon, Inc., 5.40%, 10/15/1998 1,373,850
------------------------------------------------------------------ -----------
Total 5,906,445
------------------------------------------------------------------ -----------
TELECOMMUNICATIONS--1.2%
------------------------------------------------------------------
1,000,000 AT&T Corp., 6.40%, 6/2/1999 977,500
------------------------------------------------------------------ -----------
UTILITIES--2.3%
------------------------------------------------------------------
2,000,000 Midwest Power Systems, Inc., 6.25%, 2/1/1998 1,943,360
------------------------------------------------------------------ -----------
TOTAL CORPORATE BONDS (IDENTIFIED COST, $36,362,370) 36,038,597
------------------------------------------------------------------ -----------
U.S. GOVERNMENT AGENCY OBLIGATIONS--30.5%
- -------------------------------------------------------------------------------------
FEDERAL FARM CREDIT BANK--1.8%
------------------------------------------------------------------
1,000,000 6.20%, 9/16/1996 999,687
------------------------------------------------------------------
500,000 8.25%, 5/1/2007 496,525
------------------------------------------------------------------ -----------
Total 1,496,212
------------------------------------------------------------------ -----------
FEDERAL HOME LOAN BANK--10.7%
------------------------------------------------------------------
500,000 5.50%, 6/21/1996 498,950
------------------------------------------------------------------
500,000 6.125%, 6/30/1997 494,530
------------------------------------------------------------------
2,000,000 5.545%, 3/24/1999 1,902,140
------------------------------------------------------------------
1,000,000 5.15%, 3/29/1999 991,720
------------------------------------------------------------------
2,000,000 8.215%, 12/6/1999 2,027,420
------------------------------------------------------------------
1,000,000 8.035%, 4/3/2002 995,000
------------------------------------------------------------------
1,000,000 7.20%, 4/29/2004 999,440
------------------------------------------------------------------
1,000,000 8.25%, 4/4/2005 991,560
------------------------------------------------------------------ -----------
Total 8,900,760
------------------------------------------------------------------ -----------
</TABLE>
PEACHTREE BOND FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- ------------------------------------------------------------------ -----------
<C> <C> <S> <C>
U.S. GOVERNMENT AGENCY OBLIGATIONS--CONTINUED
- -------------------------------------------------------------------------------------
FEDERAL HOME LOAN MORTGAGE CORP.--1.8%
------------------------------------------------------------------
$ 1,000,000 6.47%, 4/28/1999 $ 999,480
------------------------------------------------------------------
500,000 5.135%, 3/10/2000 461,680
------------------------------------------------------------------ -----------
Total 1,461,160
------------------------------------------------------------------ -----------
FEDERAL NATIONAL MORTGAGE ASSOCIATION--10.0%
------------------------------------------------------------------
500,000 5.24%, 2/25/1998 487,345
------------------------------------------------------------------
1,000,000 5.30%, 3/11/1998 947,850
------------------------------------------------------------------
1,000,000 5.77%, 8/25/1998 960,625
------------------------------------------------------------------
1,000,000 4.38%, 10/23/1998 989,130
------------------------------------------------------------------
1,000,000 9.05%, 4/10/2000 1,071,630
------------------------------------------------------------------
1,000,000 7.30%, 10/28/2002 973,020
------------------------------------------------------------------
1,000,000 6.40%, 1/13/2004 917,490
------------------------------------------------------------------
2,000,000 7.65%, 4/29/2004 1,959,560
------------------------------------------------------------------ -----------
Total 8,306,650
------------------------------------------------------------------ -----------
STUDENT LOAN MARKETING ASSOCIATION--2.6%
------------------------------------------------------------------
1,500,000 4.625%, 3/2/1999 1,450,830
------------------------------------------------------------------
700,000 6.08%, 3/7/2001 700,833
------------------------------------------------------------------ -----------
Total 2,151,663
------------------------------------------------------------------ -----------
TENNESSEE VALLEY AUTHORITY--3.6%
------------------------------------------------------------------
500,000 4.60%, 12/15/1996 481,215
------------------------------------------------------------------
1,000,000 7.318%, 5/31/1999 993,280
------------------------------------------------------------------
1,000,000 6.25%, 8/1/1999 959,030
------------------------------------------------------------------
500,000 8.375%, 10/1/1999 520,955
------------------------------------------------------------------ -----------
Total 2,954,480
------------------------------------------------------------------ -----------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS
(IDENTIFIED COST, $26,931,656) 25,270,925
------------------------------------------------------------------ -----------
</TABLE>
PEACHTREE BOND FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- ------------------------------------------------------------------ -----------
<C> <C> <S> <C>
U.S. TREASURY OBLIGATIONS--18.9%
- -------------------------------------------------------------------------------------
U.S. TREASURY NOTES--18.9%
------------------------------------------------------------------
$ 1,000,000 9.375%, 4/15/1996 $ 1,028,120
------------------------------------------------------------------
1,000,000 8.00%, 10/15/1996 1,018,810
------------------------------------------------------------------
1,000,000 7.25%, 11/15/1996 1,008,120
------------------------------------------------------------------
3,000,000 8.50%, 5/15/1997 3,097,740
------------------------------------------------------------------
2,000,000 7.875%, 4/15/1998 2,051,020
------------------------------------------------------------------
3,000,000 9.00%, 5/15/1998 3,170,820
------------------------------------------------------------------
100,000 5.00%, 1/31/1999 93,313
------------------------------------------------------------------
3,000,000 8.00%, 8/15/1999 3,106,350
------------------------------------------------------------------
1,000,000 8.50%, 2/15/2000 1,058,000
------------------------------------------------------------------ -----------
TOTAL U.S. TREASURY OBLIGATIONS (IDENTIFIED COST, $16,818,024) 15,632,293
------------------------------------------------------------------ -----------
CASH EQUIVALENT--0.2%
- -------------------------------------------------------------------------------------
172,604 Bank of New York Cash Reserve, 5.25% 172,604
------------------------------------------------------------------ -----------
*REPURCHASE AGREEMENT--7.5%
- -------------------------------------------------------------------------------------
6,200,000 Lehman Brothers, Inc., 6.15%, dated 3/31/1995, due 4/3/1995
(AT AMORTIZED COST) 6,200,000
------------------------------------------------------------------ -----------
TOTAL INVESTMENTS (IDENTIFIED COST, $86,484,654) $83,314,419+
------------------------------------------------------------------ -----------
</TABLE>
* The repurchase agreement is fully collateralized by U.S. government and/or
agency obligations based on market prices at the date of the portfolio.
+ The cost of investments for federal tax purposes amounts to $86,484,654. The
unrealized depreciation of investments on a federal tax basis amounts to
$3,170,235, which is comprised of $189,809 appreciation and $3,360,044
depreciation at March 31, 1995.
Note: The categories of investments are shown as a percentage of net assets
($82,775,888) at March 31, 1995.
(See Notes which are an integral part of the Financial Statements)
PEACHTREE BOND FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
ASSETS:
- -------------------------------------------------------------------------------
Investments in securities, at value (identified and tax cost $86,484,654) $83,314,419
- -------------------------------------------------------------------------------
Income receivable 1,571,948
- -------------------------------------------------------------------------------
Receivable for shares sold 382,132
- -------------------------------------------------------------------------------
Deferred expenses 25,725
- ------------------------------------------------------------------------------- -----------
Total assets 85,294,224
- -------------------------------------------------------------------------------
LIABILITIES:
- -------------------------------------------------------------------------------
Payable for investments purchased $1,998,488
- ------------------------------------------------------------------
Payable for shares redeemed 106,024
- ------------------------------------------------------------------
Income distribution payable 413,824
- ------------------------------------------------------------------ ----------
Total liabilities 2,518,336
- ------------------------------------------------------------------------------- -----------
Net Assets for 8,813,860 shares outstanding $82,775,888
- ------------------------------------------------------------------------------- -----------
NET ASSETS CONSISTS OF:
- -------------------------------------------------------------------------------
Paid in capital $87,616,912
- -------------------------------------------------------------------------------
Net unrealized depreciation of investments (3,170,235)
- -------------------------------------------------------------------------------
Accumulated net realized loss on investments (1,670,789)
- ------------------------------------------------------------------------------- -----------
Total Net Assets $82,775,888
- ------------------------------------------------------------------------------- -----------
NET ASSET VALUE, Offering Price and Redemption Proceeds Per Share:
Net Asset Value Per Share ($82,775,888 / 8,813,860 shares outstanding) $9.39
- -------------------------------------------------------------------------------
Offering Price Per Share (100/97.50 of $9.39)* $9.63
- -------------------------------------------------------------------------------
</TABLE>
* See "What Shares Cost" in the Prospectus.
(See Notes which are an integral part of the Financial Statements)
PEACHTREE BOND FUND
STATEMENT OF OPERATIONS
SIX MONTHS ENDED MARCH 31, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
- --------------------------------------------------------------------------------
Interest $2,906,807
- --------------------------------------------------------------------------------
EXPENSES:
- --------------------------------------------------------------------------------
Investment advisory fee $308,576
- ---------------------------------------------------------------------
Administrative personnel and services fee 58,891
- ---------------------------------------------------------------------
Custodian fees 10,514
- ---------------------------------------------------------------------
Transfer agent and dividend disbursing agent fees and expenses 37,888
- ---------------------------------------------------------------------
Directors'/Trustees' fees 1,296
- ---------------------------------------------------------------------
Auditing fees 4,800
- ---------------------------------------------------------------------
Legal fees 3,517
- ---------------------------------------------------------------------
Portfolio accounting fees 28,945
- ---------------------------------------------------------------------
Share registration costs 15,206
- ---------------------------------------------------------------------
Printing and postage 7,648
- ---------------------------------------------------------------------
Insurance premiums 3,159
- ---------------------------------------------------------------------
Miscellaneous 3,703
- --------------------------------------------------------------------- --------
Total expenses 484,143
- ---------------------------------------------------------------------
Deduct--Waiver of investment advisory fee 63,988
- --------------------------------------------------------------------- --------
Net expenses 420,155
- -------------------------------------------------------------------------------- ----------
Net investment income 2,486,652
- -------------------------------------------------------------------------------- ----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
- --------------------------------------------------------------------------------
Net realized loss on investments (716,632)
- --------------------------------------------------------------------------------
Net change in unrealized depreciation of investments 1,082,535
- -------------------------------------------------------------------------------- ----------
Net realized and unrealized gain on investments 365,903
- -------------------------------------------------------------------------------- ----------
Change in net assets resulting from operations $2,852,555
- -------------------------------------------------------------------------------- ----------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
PEACHTREE BOND FUND
STATEMENT OF CHANGES IN NET ASSETS
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS
ENDED PERIOD ENDED
MARCH 31, 1995 SEPTEMBER 30,
(UNAUDITED) 1994*
--------------- ----------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
- ------------------------------------------------------
OPERATIONS--
- ------------------------------------------------------
Net investment income $ 2,486,652 $ 2,781,233
- ------------------------------------------------------
Net realized loss on investments ($1,670,789 net loss
and $0, respectively, as computed for federal tax
purposes) (716,632) (954,157)
- ------------------------------------------------------
Net change in unrealized depreciation of investments 1,082,535 (4,252,770)
- ------------------------------------------------------ -------------- ---------------
Change in net assets resulting from operations 2,852,555 (2,425,694)
- ------------------------------------------------------ -------------- ---------------
DISTRIBUTIONS TO SHAREHOLDERS--
- ------------------------------------------------------
Distributions from net investment income (2,486,652) (2,781,233)
- ------------------------------------------------------ -------------- ---------------
SHARE TRANSACTIONS--
- ------------------------------------------------------
Proceeds from sale of shares 15,715,753 100,463,066
- ------------------------------------------------------
Net asset value of shares issued to shareholders in
payment of distributions declared 2,192,763 2,745,421
- ------------------------------------------------------
Cost of shares redeemed (17,092,799) (16,407,292)
- ------------------------------------------------------ -------------- ---------------
Change in net assets resulting from share
transactions 815,717 86,801,195
- ------------------------------------------------------ -------------- ---------------
Change in net assets 1,181,620 81,594,268
- ------------------------------------------------------
NET ASSETS:
- ------------------------------------------------------
Beginning of period 81,594,268 --
- ------------------------------------------------------ -------------- ---------------
End of period $ 82,775,888 $ 81,594,268
- ------------------------------------------------------ -------------- ---------------
</TABLE>
* For the period from February 14, 1994 (date of initial public investment) to
September 30, 1994.
(See Notes which are an integral part of the Financial Statements)
PEACHTREE BOND FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
<TABLE>
<CAPTION>
SIX MONTHS PERIOD
ENDED ENDED
MARCH 31, 1995 SEPTEMBER 30,
(UNAUDITED) 1994(A)
--------------- ---------------
<S> <C> <C>
- ------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 9.34 $ 10.00
- ------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS
- ------------------------------------------------------
Net investment income 0.28 0.35
- ------------------------------------------------------
Net realized and unrealized gain (loss) on
investments 0.05 (0.66)
-----
- ------------------------------------------------------ -----------
Total from investment operations 0.33 (0.31)
- ------------------------------------------------------
LESS DISTRIBUTIONS
- ------------------------------------------------------
Distributions from net investment income (0.28) (0.35)
-----
- ------------------------------------------------------ -----------
NET ASSET VALUE, END OF PERIOD $ 9.39 $ 9.34
-----
- ------------------------------------------------------ -----------
TOTAL RETURN (B) 3.60% (3.08%)
- ------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
- ------------------------------------------------------
Expenses 1.02%(c) 0.97%(c)
- ------------------------------------------------------
Net investment income 6.04%(c) 5.92%(c)
- ------------------------------------------------------
Expense waiver/reimbursement (d) 0.16%(c) 0.10%(c)
- ------------------------------------------------------
SUPPLEMENTAL DATA
- ------------------------------------------------------
Net assets, end of period (000 omitted) $82,776 $81,594
- ------------------------------------------------------
Portfolio turnover 12% 21%
- ------------------------------------------------------
</TABLE>
(a) Reflects operations for the period from February 14, 1994 (date of initial
public investment) to September 30, 1994.
(b) Based on net asset value, which does not reflect the sales load or
contingent deferred sales charge, if applicable.
(c) Computed on an annualized basis.
(d) This voluntary expense decrease is reflected in both the expense and net
investment income ratios shown above.
(See Notes which are an integral part of the Financial Statements)
PEACHTREE BOND FUND
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
(1) ORGANIZATION
Peachtree Funds (the "Trust") is registered under the Investment Company Act of
1940, as amended (the "Act"), as an open-end management investment company. The
Trust consists of four diversified portfolios and one non-diversified portfolio.
The financial statements included herein present only those of Peachtree Bond
Fund (the "Fund"). The financial statements of the other portfolios are
presented separately. The assets of each portfolio are segregated and a
shareholder's interest is limited to the portfolio in which shares are held.
(2) SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. These
policies are in conformity with generally accepted accounting principles.
INVESTMENT VALUATIONS--U.S. government securities are generally valued at
the mean between the over-the-counter bid and asked prices as furnished by
an independent pricing service. Listed corporate bonds, unlisted securities
and short-term securities are valued at the prices provided by an
independent pricing service. Short-term securities with remaining
maturities of sixty days or less at the time of purchase may be valued at
amortized cost, which approximates fair market value.
REPURCHASE AGREEMENTS--It is the policy of the Fund to require the
custodian bank to take possession, to have legally segregated in the
Federal Reserve Book Entry System, or to have segregated within the
custodian bank's vault, all securities held as collateral under repurchase
agreement transactions. Additionally, procedures have been established by
the Fund to monitor, on a daily basis, the market value of each repurchase
agreement's collateral to ensure that the value of collateral at least
equals the repurchase price to be paid under the repurchase agreement
transaction.
The Fund will only enter into repurchase agreements with banks and other
recognized financial institutions, such as broker/dealers, which are deemed
by the Fund's adviser to be creditworthy pursuant to the guidelines and/or
standards reviewed or established by the Board of Trustees (the
"Trustees").
Risks may arise from the potential inability of counterparties to honor the
terms of the repurchase agreement. Accordingly, the Fund could receive less
than the repurchase price on the sale of collateral securities.
PEACHTREE BOND FUND
- --------------------------------------------------------------------------------
INVESTMENT INCOME, EXPENSES AND DISTRIBUTIONS--Interest income and expenses
are accrued daily. Bond premium and discount, if applicable, are amortized
as required by the Internal Revenue Code, as amended (the "Code").
Distributions to shareholders are recorded on the ex-dividend date.
FEDERAL TAXES--It is the Fund's policy to comply with the provisions of the
Code applicable to regulated investment companies and to distribute to
shareholders each year substantially all of its income. Accordingly, no
provisions for federal tax are necessary.
Additionally, net capital losses of $954,157 attributable to security
transactions incurred after February 14, 1994, are treated as arising on
October 1, 1994, the first day of the Fund's current taxable year.
WHEN-ISSUED AND DELAYED DELIVERY TRANSACTIONS--The Fund may engage in
when-issued or delayed delivery transactions. The Fund records when-issued
securities on the trade date and maintains security positions such that
sufficient liquid assets will be available to make payment for the
securities purchased. Securities purchased on a when-issued or delayed
delivery basis are marked to market daily and begin earning interest on the
settlement date.
DEFERRED EXPENSES--The costs incurred by the Fund with respect to
registration of its shares in its first fiscal year, excluding the initial
expense of registering the shares, have been deferred and are being
amortized using the straight-line method not to exceed a period of five
years from the Fund's commencement date.
OTHER--Investment transactions are accounted for on the trade date.
(3) SHARES OF BENEFICIAL INTEREST
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value).
Transactions in shares were as follows:
<TABLE>
<CAPTION>
SIX MONTHS PERIOD ENDED
ENDED SEPTEMBER 30,
MARCH 31, 1995 1994*
--------------- -------------------
<S> <C> <C>
- ---------------------------------------------------
Shares sold 1,692,061 10,178,415
- ---------------------------------------------------
Shares issued to shareholders in payment of
distributions declared 235,993 288,542
- ---------------------------------------------------
Shares redeemed (1,849,430) (1,731,721)
- --------------------------------------------------- ------------- ---------------
Net change resulting from share transactions 78,624 8,735,236
- --------------------------------------------------- ------------- ---------------
</TABLE>
* For the period from February 14, 1994 (date of initial public investment) to
September 30, 1994.
PEACHTREE BOND FUND
- --------------------------------------------------------------------------------
(4) INVESTMENT ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY FEE--Bank South, N.A., the Fund's investment adviser (the
"Adviser"), receives for its services an annual investment advisory fee equal to
.75 of 1% of the Fund's average daily net assets. The Adviser may voluntarily
choose to waive any portion of its fee. The Adviser can modify or terminate this
voluntary waiver at any time at its sole discretion.
ADMINISTRATIVE FEE--Federated Administrative Services ("FAS") provides the Fund
with certain administrative personnel and services. The FAS fee is based on the
level of average aggregate net assets of the Trust for the period. FAS may
voluntarily choose to waive a portion of its fee.
TRANSFER AND DIVIDEND DISBURSING AGENT AND PORTFOLIO ACCOUNTING FEES--Federated
Services Company ("FServ") serves as transfer and dividend disbursing agent for
the Fund. This fee is based on the size, type, and number of accounts and
transactions made by shareholders.
FServ also maintains the Fund's accounting records for which it receives a fee.
The fee is based on the level of the Fund's average net assets for the period,
plus out-of-pocket expenses.
ORGANIZATIONAL EXPENSES--Organizational expenses of $44,639 were initially borne
by FAS. The Fund has agreed to reimburse FAS for organizational expenses during
the five year period following January 7, 1994 (the date the Fund became
effective). For the period ended March 31, 1995, the Fund paid $1,022 pursuant
to this agreement.
GENERAL--Certain of the Officers and Trustees of the Trust are Officers and
Directors or Trustees of the above companies.
(5) INVESTMENT TRANSACTIONS
Purchases and sales of investments, excluding short-term securities, for the
period ended March 31, 1995, were as follows:
<TABLE>
<S> <C>
- -------------------------------------------------------------------------------
PURCHASES $16,361,399
- ------------------------------------------------------------------------------- -----------
SALES $ 8,991,895
- ------------------------------------------------------------------------------- -----------
</TABLE>
<TABLE>
<S> <C>
TRUSTEES OFFICERS
- -----------------------------------------------------------------------------
John F. Donahue John F. Donahue
Thomas G. Bigley Chairman
John T. Conroy, Jr. Edward C. Gonzales
William J. Copeland President and Treasurer
James E. Dowd Charles L. Davis, Jr.
Lawrence D. Ellis, M.D. Vice President and Assistant Treasurer
Edward L. Flaherty, Jr. J. Christopher Donahue
Edward C. Gonzales Vice President
Peter E. Madden Richard B. Fisher
Gregor F. Meyer Vice President
John E. Murray, Jr. John W. McGonigle
Wesley W. Posvar Vice President and Secretary
Marjorie P. Smuts David M. Taylor
Assistant Treasurer
C. Grant Anderson
Assistant Secretary
</TABLE>
the Peachtree Funds
Prime Money
Market Fund
and
Government
Money
Market Fund
Semi-Annual Report
March 31, 1995
Logo
Bank South, N.A.
INVESTMENT ADVISER
3350 CUMBERLAND CIRCLE
ATLANTA, GA 30339
Logo
Federated Securities Corp.
Distributor
A subsidiary of FEDERATED INVESTORS
FEDERATED INVESTORS TOWER
PITTSBURGH, PA 15222-3779
70467H408
70467H309
G00223-04 (5/95)
PRESIDENT'S MESSAGE
- --------------------------------------------------------------------------------
Dear Shareholder:
I am pleased to present the Semi-Annual Report of the Peachtree Money Market
Funds (the "Funds") for the six-month period ended March 31, 1995. This report
provides you with complete financial information for the Funds, including
investment reviews by the portfolio managers, a list of investments for each
fund, and the financial statements.
Please note the following highlights from the last six-month reporting period.
Assets in the Peachtree Money Market Funds amounted to $150 million. Net assets
in the Peachtree Government Money Market Fund fell to $67.2 million, while the
dividends paid to shareholders totaled $1.9 million, or $0.02 per share.
Peachtree Prime Money Market Fund assets amounted to $83.9 million, and the fund
paid dividends of $2.0 million, or $0.03 per share. For the period ended March
31, 1995, the seven-day yield was 5.49% for the Peachtree Government Money
Market Fund and 5.61% for the Peachtree Prime Money Market Fund.*
Thank you for your confidence in the Peachtree Money Market Funds as a way to
put your cash to work. We will continue to keep you informed about your
investment, as we remain committed to delivering the highest level of personal
service.
Sincerely,
Edward C. Gonzales
President
May 8, 1995
* Performance quoted represents past performance and is not indicative of future
results. Yield will vary.
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
During the past six months we have seen the bond market rally and recover from
some of the damage done during the last quarter of 1993 and most of 1994. Yields
have fallen approximately 25 basis points on U.S. Treasury notes maturing in one
year. Rates on issues maturing in two to thirty years fell from 75 to 120 basis
points, respectively. Money market rates, on the other hand, have actually
climbed over the same period. Rates on 3-month Treasury bills have risen 60
basis points and 6-month bills have increased 15 basis points. Short rates have
fallen over the past three months, however. Our speculation that the Federal
Reserve Board (the "Fed") would raise rates once more during the first half of
1995 seems to be less probable given most of the weak economic news during the
past few weeks. We continue to feel that overall market yields, including short
rates, will meander with the general direction headed lower as it becomes less
and less likely that the Fed will raise rates any time soon. As we have for the
past several weeks, all cash inflows will be used to purchase longer maturity
issues.
PEACHTREE PRIME MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ------------ ----------------------------------------------------------------- -----------
<C> <C> <S> <C>
*COMMERCIAL PAPER--38.1%
- -------------------------------------------------------------------------------------
AUTOMOTIVE & RELATED--4.2%
-----------------------------------------------------------------
$ 3,500,000 Ford Motor Credit Co., 5.96%, 4/4/1995 $ 3,498,262
----------------------------------------------------------------- -----------
ELECTRICAL EQUIPMENT--6.4%
-----------------------------------------------------------------
1,000,000 General Electric Co., 5.309%, 4/10/1995 998,720
-----------------------------------------------------------------
2,000,000 General Electric Capital Corp., 5.93%, 4/10/1995 1,997,035
-----------------------------------------------------------------
2,433,000 Sharp Electronics, 6.206%, 6/9/1995 2,404,061
----------------------------------------------------------------- -----------
Total 5,399,816
----------------------------------------------------------------- -----------
ENERGY--4.2%
-----------------------------------------------------------------
3,500,000 Chevron Corp., 5.85%, 4/7/1995 3,496,587
----------------------------------------------------------------- -----------
FINANCE--14.9%
-----------------------------------------------------------------
2,000,000 American Express, 5.90%, 4/5/1995 1,998,689
-----------------------------------------------------------------
3,500,000 IBM Credit Corp., 5.95%, 4/10/1995 3,494,794
-----------------------------------------------------------------
3,500,000 Prudential Funding Corp., 5.93%, 4/3/1995 3,498,847
-----------------------------------------------------------------
3,500,000 Smith Barney, Inc., 5.93%, 4/7/1995 3,496,541
----------------------------------------------------------------- -----------
Total 12,488,871
----------------------------------------------------------------- -----------
MANUFACTURING--8.4%
-----------------------------------------------------------------
3,500,000 Deere & Co., 5.94%, 4/6/1995 3,497,113
-----------------------------------------------------------------
3,500,000 ITT Corp., 6.00%, 4/7/1995 3,496,500
----------------------------------------------------------------- -----------
Total 6,993,613
----------------------------------------------------------------- -----------
TOTAL COMMERCIAL PAPER 31,877,149
----------------------------------------------------------------- -----------
</TABLE>
PEACHTREE PRIME MONEY MARKET FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ------------ ----------------------------------------------------------------- -----------
<C> <C> <S> <C>
CORPORATE BONDS--17.4%
- -------------------------------------------------------------------------------------
CHEMICAL--1.2%
-----------------------------------------------------------------
$1,000,000 Dow Capital, 6.45%, 5/15/1995 $1,000,999
----------------------------------------------------------------- -----------
FINANCE--3.0%
-----------------------------------------------------------------
1,000,000 Exxon Capital Corp., 8.00%, 12/1/1995 1,008,601
-----------------------------------------------------------------
1,550,000 NationsBank Corp., 5.375%, 12/1/1995 1,530,302
----------------------------------------------------------------- -----------
Total 2,538,903
----------------------------------------------------------------- -----------
FOOD, BEVERAGES & HOUSEHOLD PRODUCTS--1.2%
-----------------------------------------------------------------
1,000,000 PepsiCo, Inc., 5.625%, 7/1/1995 1,000,032
----------------------------------------------------------------- -----------
FOREST PRODUCTS--3.0%
-----------------------------------------------------------------
2,500,000 Weyerhaeuser Co., 9.25%, 11/15/1995 2,532,974
----------------------------------------------------------------- -----------
POLLUTION CONTROL--1.8%
-----------------------------------------------------------------
1,520,000 Waste Management, Inc., 4.875%, 7/1/1995 1,517,614
----------------------------------------------------------------- -----------
UTILITIES--7.2%
-----------------------------------------------------------------
2,500,000 Carolina Power & Light Co., 8.86%, 7/20/1995 2,523,794
-----------------------------------------------------------------
2,500,000 Pacific Gas & Electric Co., 4.20%, 10/10/1995 2,461,515
-----------------------------------------------------------------
1,000,000 Public Service Electric & Gas Co., 6.00%, 6/1/1995 1,000,830
----------------------------------------------------------------- -----------
Total 5,986,139
----------------------------------------------------------------- -----------
TOTAL CORPORATE BONDS 14,576,661
----------------------------------------------------------------- -----------
NOTES--4.8%
- -------------------------------------------------------------------------------------
1,000,000 Coca-Cola Enterprises, Inc., 8.35%, 6/20/1995 1,005,775
-----------------------------------------------------------------
3,000,000 CoreStates Capital Corp., 5.60% Medium Term Note, 11/17/1995 2,967,842
----------------------------------------------------------------- -----------
TOTAL NOTES 3,973,617
----------------------------------------------------------------- -----------
</TABLE>
PEACHTREE PRIME MONEY MARKET FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ------------ ----------------------------------------------------------------- -----------
<C> <C> <S> <C>
CASH EQUIVALENT--0.01%
- -------------------------------------------------------------------------------------
$ 4,621 Bank of New York Cash Reserves, 5.25% $ 4,621
----------------------------------------------------------------- -----------
**REPURCHASE AGREEMENTS--39.7%
- -------------------------------------------------------------------------------------
18,169,136 Lehman Brothers, Inc., 6.15%, dated 3/31/1995, due 4/4/1995 18,169,136
-----------------------------------------------------------------
15,030,345 Prudential Securities, Inc., 6.07%, dated 3/30/1995, due 4/3/1995 15,030,345
----------------------------------------------------------------- -----------
TOTAL REPURCHASE AGREEMENTS 33,199,481
----------------------------------------------------------------- -----------
TOTAL INVESTMENTS (AT AMORTIZED COST) $83,631,529+
----------------------------------------------------------------- -----------
</TABLE>
+ Also represents cost for federal tax purposes.
* Each issue shows the rate of discount at time of purchase.
** The repurchase agreements are fully collateralized by U.S. government and/or
agency obligations, based on market prices at the date of the portfolio.
Note: The categories of investments are shown as a percentage of net assets
($83,601,985) at March 31, 1995.
(See Notes which are an integral part of the Financial Statements)
PEACHTREE PRIME MONEY MARKET FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
ASSETS:
- ---------------------------------------------------------------------------------
Investments in repurchase agreements $33,199,481
- -------------------------------------------------------------------
Investments in securities 50,432,048
- ------------------------------------------------------------------- -----------
Total investments in securities, at amortized cost $83,631,529
- ---------------------------------------------------------------------------------
Income receivable 284,975
- ---------------------------------------------------------------------------------
Receivable for shares sold 1,539
- ---------------------------------------------------------------------------------
Deferred expenses 27,885
- --------------------------------------------------------------------------------- -----------
Total assets 83,945,928
- ---------------------------------------------------------------------------------
LIABILITIES:
- ---------------------------------------------------------------------------------
Income distribution payable 319,717
- -------------------------------------------------------------------
Accrued expenses 24,226
- ------------------------------------------------------------------- -----------
Total liabilities 343,943
- --------------------------------------------------------------------------------- -----------
Net Assets for 83,601,985 shares of beneficial interest outstanding $83,601,985
- --------------------------------------------------------------------------------- -----------
NET ASSET VALUE, Offering Price and Redemption Proceeds Per Share:
Net Asset Value Per Share ($83,601,985/83,601,985 shares of
beneficial interest outstanding) $1.00
- ---------------------------------------------------------------------------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
PEACHTREE PRIME MONEY MARKET FUND
STATEMENT OF OPERATIONS
SIX MONTHS ENDED MARCH 31, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
- --------------------------------------------------------------------------------
Interest $2,239,878
- --------------------------------------------------------------------------------
EXPENSES:
- --------------------------------------------------------------------------------
Investment advisory fee $200,275
- ---------------------------------------------------------------------
Administrative personnel and services fee 57,345
- ---------------------------------------------------------------------
Custodian fees 11,906
- ---------------------------------------------------------------------
Transfer agent and dividend disbursing agent fees and expenses 15,255
- ---------------------------------------------------------------------
Directors'/Trustees' fees 1,519
- ---------------------------------------------------------------------
Auditing fees 5,213
- ---------------------------------------------------------------------
Legal fees 3,414
- ---------------------------------------------------------------------
Portfolio accounting fees 20,742
- ---------------------------------------------------------------------
Share registration costs 14,442
- ---------------------------------------------------------------------
Printing and postage 7,247
- ---------------------------------------------------------------------
Insurance premiums 3,210
- ---------------------------------------------------------------------
Miscellaneous 2,812
- --------------------------------------------------------------------- --------
Total expenses 343,380
- ---------------------------------------------------------------------
Deduct--Waiver of investment advisory fee 125,987
- --------------------------------------------------------------------- --------
Net expenses 217,393
- -------------------------------------------------------------------------------- ----------
Net investment income $2,022,485
- -------------------------------------------------------------------------------- ----------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
PEACHTREE PRIME MONEY MARKET FUND
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS
ENDED PERIOD ENDED
MARCH 31, 1995 SEPTEMBER 30,
(UNAUDITED) 1994*
-------------- ---------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
- -----------------------------------------------------------
OPERATIONS--
- -----------------------------------------------------------
Net investment income $ 2,022,485 $ 1,308,837
- ----------------------------------------------------------- ------------- --------------
DISTRIBUTIONS TO SHAREHOLDERS--
- -----------------------------------------------------------
Distributions from net investment income (2,022,485) (1,308,837)
- ----------------------------------------------------------- ------------- --------------
SHARE TRANSACTIONS--
- -----------------------------------------------------------
Proceeds from sale of shares 91,349,119 159,735,721
- -----------------------------------------------------------
Net asset value of shares issued to shareholders in payment
of distributions declared 158,582 38,293
- -----------------------------------------------------------
Cost of shares redeemed (92,585,404) (75,094,326)
- ----------------------------------------------------------- ------------- --------------
Change in net assets resulting from share transactions (1,077,703) 84,679,688
-----------
- ----------------------------------------------------------- -------------
Change in net assets (1,077,703) 84,679,688
- -----------------------------------------------------------
NET ASSETS:
- -----------------------------------------------------------
Beginning of period 84,679,688 --
- ----------------------------------------------------------- ------------- --------------
End of period $ 83,601,985 $84,679,688
- ----------------------------------------------------------- ------------- --------------
</TABLE>
* For the period from February 14, 1994 (date of initial public investment) to
September 30, 1994.
(See Notes which are an integral part of the Financial Statements)
PEACHTREE PRIME MONEY MARKET FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
<TABLE>
<CAPTION>
SIX MONTHS PERIOD
ENDED ENDED
MARCH 31, 1995 SEPTEMBER 30,
(UNAUDITED) 1994(A)
---------------- ---------------------
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.00 $ 1.00
- ------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS
- ------------------------------------------------
Net investment income 0.03 0.02
- ------------------------------------------------
LESS DISTRIBUTIONS
- ------------------------------------------------
Distributions from net investment income (0.03) (0.02)
- ------------------------------------------------ ----------- -------------
NET ASSET VALUE, END OF PERIOD $ 1.00 $ 1.00
- ------------------------------------------------ ----------- -------------
TOTAL RETURN (B) 2.56% 2.41%
- ------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
- ------------------------------------------------
Expenses 0.54%(c) 0.38%(c)
- ------------------------------------------------
Net investment income 5.05%(c) 3.99%(c)
- ------------------------------------------------
Expense waiver/reimbursement (d) 0.31%(c) 0.51%(c)
- ------------------------------------------------
SUPPLEMENTAL DATA
- ------------------------------------------------
Net assets, end of period (000 omitted) $83,602 $84,680
- ------------------------------------------------
</TABLE>
(a) Reflects operations for the period from February 14, 1994 (date of initial
public investment) to September 30, 1994.
(b) Based on net asset value, which does not reflect the sales load or
contingent deferred sales charge, if applicable.
(c) Computed on an annualized basis.
(d) This voluntary expense decrease is reflected in both the expense and net
investment income ratios shown above.
(See Notes which are an integral part of the Financial Statements)
PEACHTREE GOVERNMENT MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 1995 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ------------ ----------------------------------------------------------------- -----------
<C> <C> <S> <C>
SHORT-TERM OBLIGATIONS--56.0%
- -------------------------------------------------------------------------------------
$ 28,000,000 U.S. Treasury Bills, 4/6/1995-11/16/1995 $27,600,502
-----------------------------------------------------------------
10,000,000 U.S. Treasury Notes, 3.875%-8.50%, 4/30/1995-11/15/1995 9,996,455
----------------------------------------------------------------- -----------
TOTAL SHORT-TERM U.S. TREASURY OBLIGATIONS 37,596,957
----------------------------------------------------------------- -----------
*REPURCHASE AGREEMENTS--44.1%
- -------------------------------------------------------------------------------------
14,779,411 Lehman Brothers, Inc., 6.15%, dated 3/31/1995, due 4/4/1995 14,779,411
-----------------------------------------------------------------
14,808,610 Prudential Securities, Inc., 6.07%, dated 3/30/1995, due 4/3/1995 14,808,610
----------------------------------------------------------------- -----------
TOTAL REPURCHASE AGREEMENTS 29,588,021
----------------------------------------------------------------- -----------
TOTAL INVESTMENTS (AT AMORTIZED COST) $67,184,978+
----------------------------------------------------------------- -----------
</TABLE>
+ Also represents cost for federal tax purposes.
* The repurchase agreements are fully collateralized by U.S. government and/or
agency obligations based on market prices at the date of the portfolio.
Note: The categories of investments are shown as a percentage of net assets
($67,158,722) at March 31, 1995.
(See Notes which are an integral part of the Financial Statements)
PEACHTREE GOVERNMENT MONEY MARKET FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
ASSETS:
- ---------------------------------------------------------------------------------
Investments in repurchase agreements $29,588,021
- -------------------------------------------------------------------
Investments in securities 37,596,957
- ------------------------------------------------------------------- -----------
Total investments in securities, at amortized cost $67,184,978
- ---------------------------------------------------------------------------------
Cash 4,686
- ---------------------------------------------------------------------------------
Income receivable 250,395
- ---------------------------------------------------------------------------------
Deferred expenses 26,227
- --------------------------------------------------------------------------------- -----------
Total assets 67,466,286
- ---------------------------------------------------------------------------------
LIABILITIES:
- ---------------------------------------------------------------------------------
Income distribution payable 297,442
- -------------------------------------------------------------------
Accrued expenses 10,122
- ------------------------------------------------------------------- -----------
Total liabilities 307,564
- --------------------------------------------------------------------------------- -----------
Net Assets for 67,158,722 shares outstanding $67,158,722
- --------------------------------------------------------------------------------- -----------
NET ASSET VALUE, Offering Price and Redemption Proceeds Per Share:
Net Asset Value Per Share ($67,158,722 / 67,158,722 shares
outstanding) $1.00
- ---------------------------------------------------------------------------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
PEACHTREE GOVERNMENT MONEY MARKET FUND
STATEMENT OF OPERATIONS
SIX MONTHS ENDED MARCH 31, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
- --------------------------------------------------------------------------------
Interest $2,200,198
- --------------------------------------------------------------------------------
EXPENSES:
- --------------------------------------------------------------------------------
Investment advisory fee $205,855
- ---------------------------------------------------------------------
Administrative personnel and services fee 58,895
- ---------------------------------------------------------------------
Custodian fees 10,604
- ---------------------------------------------------------------------
Transfer agent and dividend disbursing agent fees and expenses 13,250
- ---------------------------------------------------------------------
Directors'/Trustees' fees 1,010
- ---------------------------------------------------------------------
Auditing fees 4,529
- ---------------------------------------------------------------------
Legal fees 3,214
- ---------------------------------------------------------------------
Portfolio accounting fees 17,922
- ---------------------------------------------------------------------
Share registration costs 19,380
- ---------------------------------------------------------------------
Printing and postage 6,575
- ---------------------------------------------------------------------
Insurance premiums 2,949
- ---------------------------------------------------------------------
Miscellaneous 2,196
- --------------------------------------------------------------------- --------
Total expenses 346,379
- ---------------------------------------------------------------------
Deduct--Waiver of investment advisory fee 126,899
- --------------------------------------------------------------------- --------
Net expenses 219,480
- -------------------------------------------------------------------------------- ----------
Net investment income $1,980,718
- -------------------------------------------------------------------------------- ----------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
PEACHTREE GOVERNMENT MONEY MARKET FUND
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS
ENDED
MARCH 31, 1995 PERIOD ENDED
(UNAUDITED) SEPTEMBER 30, 1994*
----------------- -------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
- -------------------------------------------------------
OPERATIONS--
- -------------------------------------------------------
Net investment income $ 1,980,718 $ 1,067,196
- ------------------------------------------------------- -------------- ------------
DISTRIBUTIONS TO SHAREHOLDERS--
- -------------------------------------------------------
Distributions from net investment income (1,980,718) (1,067,196)
- ------------------------------------------------------- -------------- ------------
SHARE TRANSACTIONS--
- -------------------------------------------------------
Proceeds from sale of shares 90,888,164 130,044,343
- -------------------------------------------------------
Net asset value of shares issued to shareholders in
payment of distributions declared 7,358 834
- -------------------------------------------------------
Cost of shares redeemed (114,176,986) (39,704,991)
- ------------------------------------------------------- -------------- ------------
Change in net assets resulting from share
transactions (23,281,464) 90,340,186
- ------------------------------------------------------- -------------- ------------
Change in net assets (23,281,464) 90,340,186
- -------------------------------------------------------
NET ASSETS:
- -------------------------------------------------------
Beginning of period 90,440,186 100,000
- ------------------------------------------------------- -------------- ------------
End of period $ 67,158,722 $ 90,440,186
- ------------------------------------------------------- -------------- ------------
</TABLE>
* For the period from January 7, 1994 (date of initial public investment) to
September 30, 1994.
(See Notes which are an integral part of the Financial Statements)
PEACHTREE GOVERNMENT MONEY MARKET FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
<TABLE>
<CAPTION>
SIX MONTHS PERIOD
ENDED ENDED
MARCH 31, 1995 SEPTEMBER 30,
(UNAUDITED) 1994(A)
---------------- ---------------------
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.00 $ 1.00
- ------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS
- ------------------------------------------------
Net investment income 0.02 0.02
- ------------------------------------------------
LESS DISTRIBUTIONS
- ------------------------------------------------
Distributions from net investment income (0.02) (0.02)
- ------------------------------------------------ ----------- -------------
NET ASSET VALUE, END OF PERIOD $ 1.00 $ 1.00
- ------------------------------------------------ ----------- -------------
TOTAL RETURN (B) 2.46% 2.44%
- ------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
- ------------------------------------------------
Expenses 0.53%(c) 0.38%(c)
- ------------------------------------------------
Net investment income 4.81%(c) 4.05%(c)
- ------------------------------------------------
Expense waiver/reimbursement (d) 0.31%(c) 0.53%(c)
- ------------------------------------------------
SUPPLEMENTAL DATA
- ------------------------------------------------
Net assets, end of period (000 omitted) $67,159 $90,440
- ------------------------------------------------
</TABLE>
(a) Reflects operations for the period from February 14, 1994 (date of initial
public investment) to September 30, 1994.
(b) Based on net asset value, which does not reflect the sales load or
contingent deferred sales charge, if applicable.
(c) Computed on an annualized basis.
(d) This voluntary expense decrease is reflected in both the expense and net
investment income ratios shown above.
(See Notes which are an integral part of the Financial Statements)
PEACHTREE MONEY MARKET FUNDS
COMBINED NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
(1) ORGANIZATION
The Peachtree Funds (the "Trust") is registered under the Investment Company Act
of 1940, as amended (the "Act"), as an open-end management investment company.
The Trust consists of four diversified portfolios and one non-diversified
portfolio. The financial statements included herein present only those of
Peachtree Prime Money Market Fund ("Prime Money Fund") and Peachtree Government
Money Market Fund ("Government Money Fund"), (individually referred to as the
"Fund", or collectively as the "Funds"). The financial statements of the other
portfolios are presented separately. The assets of each portfolio are segregated
and a shareholder's interest is limited to the portfolio in which shares are
held.
(2) SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Funds in the preparation of their financial statements. These
policies are in conformity with generally accepted accounting principles.
A. INVESTMENT VALUATIONS--The Funds' use of the amortized cost method to
value their portfolio securities is in accordance with Rule 2a-7 under the
Act.
B. REPURCHASE AGREEMENTS--It is the policy of the Funds to require the
custodian bank to take possession, to have legally segregated in the
Federal Reserve Book Entry System, or to have segregated within the
custodian bank's vault, all securities held as collateral under repurchase
agreement transactions. Additionally, procedures have been established by
the Funds to monitor, on a daily basis, the market value of each repurchase
agreement's collateral to ensure that the value of collateral at least
equals the repurchase price to be paid under the repurchase agreement
transaction.
The Funds will only enter into repurchase agreements with banks and other
recognized financial institutions, such as broker/dealers, which are deemed
by the Funds' adviser to be creditworthy pursuant to guidelines and/or
standards reviewed or established by the Board of Trustees (the
"Trustees").
Risks may arise from the potential inability of counterparties to honor the
terms of the repurchase agreement. Accordingly, the Funds could receive
less than the repurchase price on the sale of collateral securities.
C. INVESTMENT INCOME, EXPENSES AND DISTRIBUTIONS--Interest income and
expenses are accrued daily. Bond premium and discount, if applicable, are
amortized as required by the Internal Revenue Code, as amended (the
"Code"). Distributions to shareholders are recorded on the ex-dividend
date.
D. FEDERAL TAXES--It is the Funds' policy to comply with the provisions of
the Code applicable to regulated investment companies and to distribute to
shareholders each year substantially all of their income. Accordingly, no
provisions for federal tax are necessary.
E. WHEN-ISSUED AND DELAYED DELIVERY TRANSACTIONS--The Funds may engage in
when-issued or delayed delivery transactions. The Funds record when-issued
securities on the trade date and maintain security positions such that
sufficient liquid assets will be available to make payment for the
securities purchased. Securities purchased on a when-issued or delayed
delivery basis are marked to market daily and begin earning interest on the
settlement date.
F. DEFERRED EXPENSES--The costs incurred by the Funds with respect to
registration of their shares in their first fiscal year, excluding the
initial expense of registering their shares, have been deferred and are
being amortized using the straight-line method not to exceed a period of
five years from each Fund's commencement date.
G. OTHER--Investment transactions are accounted for on the trade date.
(3) SHARES OF BENEFICIAL INTEREST
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value). At March
31, 1995, capital paid-in for Prime Money Fund and Government Money Fund
aggregated $83,601,985 and $67,158,722, respectively. Transactions in shares
were as follows:
<TABLE>
<CAPTION>
PRIME GOVERNMENT
MONEY FUND MONEY FUND
---------------------------- ------------------------------
SIX
SIX MONTHS PERIOD MONTHS PERIOD
ENDED ENDED ENDED ENDED
MARCH 31, SEPTEMBER 30, MARCH 31, SEPTEMBER 30,
1995 1994* 1995 1994*
- ---------------------------------------------- ----------- -------------- ------------- --------------
<S> <C> <C> <C> <C>
Shares sold 91,349,119 159,735,721 90,888,164 130,044,343
- ----------------------------------------------
Shares issued to shareholders in payment of
distributions declared 158,582 38,293 7,358 834
- ----------------------------------------------
Shares redeemed (92,585,404) (75,094,326) (114,176,986) (39,704,991)
- ---------------------------------------------- ----------- ----------- ---------- -------------
Net change resulting from share transactions (1,077,703 ) 84,679,688 (23,281,464) 90,340,186
- ---------------------------------------------- ----------- ----------- ---------- -------------
</TABLE>
* For the period from February 14, 1994 (date of initial public investment) to
September 30, 1994.
(4) INVESTMENT ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY FEE--Bank South, N.A., the Funds' investment adviser
(the "Adviser"), receives for its services an annual investment advisory
fee equal to .50 of 1% of each Fund's average daily net assets. The Adviser
may voluntarily choose to waive a portion of its fee. The Adviser can
modify or terminate this voluntary waiver at any time at its sole
discretion.
ADMINISTRATIVE FEE--Federated Administrative Services ("FAS") provides the
Funds with certain administrative personnel and services. The FAS fee is
based on the level of average aggregate net assets of the Trust for the
period. FAS may voluntarily choose to waive a portion of its fee.
TRANSFER AND DIVIDEND DISBURSING AGENT AND PORTFOLIO ACCOUNTING
FEES--Federated Services Company ("FServ") serves as transfer and dividend
disbursing agent for the Funds. The fee is based on the size, type, and
number of accounts and transactions made by shareholders.
FServ also maintains the Funds' accounting records. The fee is based on the
level of each Fund's average net assets for the period, plus out-of-pocket
expenses.
ORGANIZATIONAL EXPENSES--Organizational expenses ($39,837 for Prime Money
Fund and $39,426 for Government Money Fund) were initially borne by FAS.
The Funds have agreed to reimburse FAS for the organizational expenses
during the five year period following January 7, 1994 (date the Funds
became effective). For the period ended March 31, 1995, Prime Money Fund
and Government Money Fund paid $1,022 and $1,022, respectively, pursuant to
this agreement.
Certain of the Officers and Trustees of the Trust are Officers and
Directors or Trustees of the above companies.
<TABLE>
<S> <C>
TRUSTEES OFFICERS
- -----------------------------------------------------------------------------
John F. Donahue John F. Donahue
Thomas G. Bigley Chairman
John T. Conroy, Jr. Edward C. Gonzales
William J. Copeland President and Treasurer
James E. Dowd Charles L. Davis, Jr.
Lawrence D. Ellis, M.D. Vice President and Assistant Treasurer
Edward L. Flaherty, Jr. J. Christopher Donahue
Edward C. Gonzales Vice President
Peter E. Madden Richard B. Fisher
Gregor F. Meyer Vice President
John E. Murray, Jr. John W. McGonigle
Wesley W. Posvar Vice President and Secretary
Marjorie P. Smuts David M. Taylor
Assistant Treasurer
C. Grant Anderson
Assistant Secretary
</TABLE>
