ANNUAL REPORT
July 31, 1996
INVESCO
MULTIPLE
ASSET
FUNDS,
INC.
Balanced Fund
Multi-Asset Allocation Fund
No-load mutual funds seeking capital appreciation and current income.
INVESCO FUNDS
<PAGE>
Market Overview August 1996
Over the first seven months of 1996, the securities markets have been
exceptionally attentive to figures: Gross Domestic Product, unemployment, and
earnings growth. Each announcement of fresh data has sent the S&P 500 and other
market indexes moving in a new direction.
Based on a moderate economic expansion, the S&P 500 advanced 9.60% for the
year-to-date as of 5/31/96. But as expectations of economic vigor grew,
investors began to see the likelihood of accelerating inflation. This in turn
made it more probable that the Federal Reserve Board would hike short-term
interest rates. In June, the broad market advanced a mere 0.40%; in July, the
index declined sharply.(1),(2)
Since 1994 the Fed has actively manipulated short-term rates, seeking to
maintain economic expansion without sparking inflation. Recently, there has been
some indication that the central bank may allow a slightly higher level of
inflation before tightening credit availability; however, their overall strategy
is unlikely to alter in the near-term, given an impending presidential election
and the recent reappointment of Alan Greenspan as Fed chairman. According to the
Bureau of Labor Statistics, fewer than 200,000 new jobs were created in July
1996. While inflation is still considered a threat by some analysts, the most
recent unemployment figure was low enough to reassure investors that the Fed
would not launch a preemptive strike against inflation in the summer. In
addition, earnings reports from a variety of industries were convincingly
strong. Stocks subsequently rallied.
The market environment has been even more challenging for bond investors.
Over the past 18 months, the fixed-income markets experienced two distinct
phases. The first began in 1995 with a bond rally that ran through January 1996.
Price advances were fueled by moderate economic growth and low inflation. For
all of 1995, the broad fixed-income market had a total return of 19.24%, as
measured by the Lehman Government/Corporate Bond Index. (Of course, past
performance is not a guarantee of future results.)(1),(2)
The second fixed-income market phase was initiated in February of this
year. The environment shifted to one of stronger economic growth, with the
concomitant potential for upward spirals in wages and prices; mild indications
have already appeared. Fixed-income investors responded to the positive economic
news by sending prices tumbling.
With more reassuring economic and corporate data being released, we may be
entering a third phase. After losing ground in four of the previous five months,
the Lehman Government/Corporate Bond Index had positive total returns in both
June and July. (Of course, past performance is not a guarantee of future
results.)(1),(2)
INVESCO Multiple Asset Funds, Inc.
The line graphs below illustrate the value of a $10,000 investment in each
of the INVESCO Multiple Asset Funds, plus reinvested dividends and capital gain
distributions, from inception through 7/31/96. The charts and other total return
figures cited reflect the funds' operating expenses, but the indexes do not have
expenses, which would, of course, have lowered their performance.(2) While past
performance is not a guarantee of future results, $10,000 invested in Balanced
Fund upon inception (12/93) would have been worth $15,517 on 7/31/96, including
reinvestment of dividends and capital gains. A $10,000 investment in Multi-Asset
Allocation Fund made on the same date would have grown to $12,440.(2)
<PAGE>
Balanced Fund
For the one-year period ended 7/31/96, Lipper Analytical Services ranked
Balanced Fund #1 of 253 balanced funds, based on total return unadjusted for
commissions.(2),(3)
For the one-year period ended 7/31/96, INVESCO Balanced Fund achieved a
total return of 20.93%, compared to a total return of 16.45% for the S&P 500,
and 5.31% for the Lehman Government/Corporate Bond Index. (Of course, past
performance is not a guarantee of future results.)(1),(2)
The fund's outperformance resulted from numerous factors. Over the first
half of the fiscal period, we overweighted basic materials, capital goods &
construction, and insurance stocks. Subsequently, we significantly reduced our
exposure to areas such as finance, which performed poorly due to rising interest
rates. Our low weighting in technology proved particularly beneficial during the
summer correction.
In selecting stocks, we continue to emphasize factors such as a company's
prospects for earnings growth,attractive valuation, and superior dividend
growth. As a result, over the past few weeks we have increased our focus on
electric utilities and natural gas companies such as Idaho Power, Piedmont
Natural Gas, and Oklahoma Gas & Electric.
Balanced Fund
Average Annualized Total Return
as of 7/31/99(2)
1 year 20.93%
-----------------------------------------
Since Inception (12/93) 17.91%
-----------------------------------------
Given the moderately positive outlook for interest rates, over the summer
we also opened or augmented holdings in the more cyclical market sectors,
including retail and capital goods. New positions include Saks Holding,
Friedman's Inc Class A, and Dollar General.
Fixed-income investments emphasize high quality securities, primarily
Treasury bonds and Federal Home Loan Mortgage obligations. At present, we
believe these offer the best trade-off of risk versus return, and they have in
fact outperformed many other market segments. If the outlook for fixed-income
securities continues to improve, we will consider adding higher yielding
corporate bonds.
Average duration of the fund's bond portfolio is normally maintained within
a range of four to six years. As prices dropped earlier this year, we shortened
duration to reduce our exposure to longer-term risk. Over the first half of
1996, intermediate issues outperformed longer-term obligations.
Graph: Balanced Fund Total Return from Inception(12/1/93) through 7/31/96
This line graph compares the value of a $10,000 investment in INVESCO
Balanced Fund to the value of a $10,000 investment in the S&P 500 Index
and the Lehman Government/Corporate Bond Index, assuming in each case
reinvestment of all dividends and capital gain distributions, for the
period from inception (12/93) through 7/31/96.
<PAGE>
Fund Management
INVESCO Balanced Fund is managed by two industry veterans. Senior Vice
President Charles P. Mayer was named portfolio manager for equity investments
earlier this year. An industry veteran with 26 years of professional experience,
he earned an MBA from St. John's University and a BA from St. Peter's College.
He is a Chartered Financial Analyst. Previously, Charlie was with Westinghouse
Pension Investments Corp.
Donovan "Jerry" Paul has served as co-portfolio manager of the fund since
1994, concentrating on fixed-income securities. Jerry began his investment
career in 1976; before joining INVESCO, he worked for Stein, Roe & Farnham Inc.
as well as Quixote Investment Management. He earned an MBA from the University
of Northern Iowa, and a BBA from the University of Iowa. He is a Chartered
Financial Analyst and Certified Public Accountant.
Multi-Asset Allocation Fund
For the one-year period ended 7/31/96, Lipper Analytical Services ranked
Multi-Asset Allocation Fund #54 of 176 flexible portfolio funds, based on total
return unadjusted for commissions.(2),(3)
For the one-year period ended 7/31/96, INVESCO Multi-Asset Allocation Fund
had a total return of 10.96%, compared to a total return of 16.45% for the S&P
500 and 5.31% for the Lehman Government/Corporate Bond Index. (Of course, past
performance is not a guarantee of future results.)(1),(2)
Over the past 12 months, the fund has focused approximately one-third of
assets in large-capitalization stocks. Holdings are diversified across all of
the major sectors, with concentrations in consumer stocks -- both cyclical and
staples. Both of these industry groups have performed relatively well in 1996.
In a reversal of the situation seen in 1995, through the end of May 1996,
smaller-cap stocks outperformed larger-cap equities. The market correction in
small-caps which began in June now appears to have run its course, and we expect
to maintain a weighting of around 14% in these equities.
Multi-Asset Allocation Fund
Average Annualized Total Return
as of 7/31/99(2)
1 year 10.96%
-----------------------------------
Since Inception (12/93) 8.53%
-----------------------------------
In periods such as 1995, when the U.S. stock market achieved a total return
over 35% for the year, the fund will tend to underperform the broad market. Our
policy of diversification across asset classes, however, insulated the fund from
some of the effects of the recent correction. In July, for instance, the S&P 500
retreated 4.39%, while the fund experienced a loss of only 2.84% (Of course,
past performance is not a guarantee of future results.).(1),(2)
At the end of 1995, we had about 24% of net assets invested in fixed-income
obligations, which benefited from the strong bond market last year. During the
opening months of 1996 and the correction in the bond market, we brought that
allocation down significantly. Prices have firmed over the summer, and we
gradually increased the proportion of government and government agency
obligations in the fund's holdings.
<PAGE>
Graph: Multi-Asset Allocation Fund Total Return from Inception (12/1/93)
through 7/31/96
This line graph compares the value of a $10,000 investment in INVESCO
Multi- Asset Allocation Fund to the value of a $10,000 investment in the
S&P 500 Index and the Lehman Government/Corporate Bond Index, assuming in
each case reinvestment of all dividends and capital gain distributions,
for the period from inception (12/93) through 7/31/96.
International securities investments were challenging throughout the
period, with most markets trailing the S&P 500. Smaller-cap companies in Europe
have performed strongly, and the broad Japanese market has come close to
matching returns from the S&P 500 -- a strong improvement over the past two
years. The fund's foreign holdings primarily represent companies from developed
markets around the world, including Japan, the U.K., Germany, and Switzerland.
Fund Management
INVESCO Multi-Asset Allocation Fund is managed by a team, which is led by
Bob Slotpole. He earned an MBA from Stanford University, as well as a BS from
the State University of New York-Buffalo. Now a senior vice president and
director of equities for INVESCO Management & Research, Inc., Bob began his
investment career in 1975. Previously, he was associated with First Boston and
Lehman Brothers.
(1) The MSCI-EAFE, S&P 500, Russell 2000, and Lehman Government/Corporate Bond
Index are unmanaged indexes of securities considered to be representative
of the overall international equity, broad domestic equity, small-cap U.S.
equity, and domestic fixed-income markets, respectively.
(2) Total return assumes reinvestment of dividends and capital gain
distributions for the periods indicated. Past performance is not a
guarantee of future results. Investment return and principal value will
fluctuate so that, when redeemed, an investor's shares may be worth more
or less than when purchased.
(3) Lipper rankings are provided for one-, five-, and 10-year periods, except
for funds introduced more recently, and are based on total return
unadjusted for commissions.
<PAGE>
INVESCO Multiple Asset Funds, Inc.
Ten Largest Common Stock Holdings
July 31, 1996
Description Value
- ---------------------------------------------------------
BALANCED Fund
Forcenergy Group AB Series B Shrs $4,358,419
IES Industries 4,115,250
Idaho Power 3,375,875
Goulds Pumps 2,714,500
Ingles Markets Class A 2,359,875
Sonat Inc 2,131,250
Scottish Television PLC 1,991,064
Astra AB Series B Shrs 1,979,449
Agrium Inc 1,893,750
Premark International 1,800,000
MULTI-ASSET ALLOCATION Fund
Royal Dutch Petroleum 5 Gldr Shrs $ 105,613
BankAmerica Corp 87,725
International Business Machines 86,300
Lilly (Eli) & Co 84,000
Philip Morris 83,700
Ford Motor 81,250
Mobil Corp 77,263
Loews Corp 72,562
Ameritech Corp 72,150
Baxter International 70,763
Composition of holdings is subject to change.
<PAGE>
INVESCO Multiple Asset Funds, Inc.
Statement of Investment Securities
July 31, 1996
Country Code Shares or
if Principal
Description Non US Amount Value
- ---------------------------------------------------------------------------
BALANCED Fund
COMMON STOCKS 58.16%
AEROSPACE & DEFENSE 1.57%
Boeing Co 5,000 $442,500
Lockheed Martin 4,300 356,362
Northrop Grumman 5,400 371,250
Sundstrand Corp 15,000 541,875
-----------
1,711,987
-----------
AUDIO/VIDEO RELATED 1.09%
Granada Group PLC UK 95,000 1,189,313
-----------
AUTOMOBILE RELATED 0.29%
Pep Boys Manny Moe & Jack 10,500 317,625
-----------
BANKING 0.65%
BanPonce Corp 30,000 708,750
-----------
BROADCASTING 1.82%
Scottish Television PLC UK 190,000 1,991,064
-----------
BUILDING &
CONSTRUCTION RELATED 0.68%
Flour Corp 5,000 301,250
Martin Marietta Materials 19,800 447,975
-----------
749,225
-----------
CHEMICALS 3.23%
Agrium Inc CA 150,000 1,893,750
ARCO Chemical 32,900 1,636,775
-----------
3,530,525
-----------
COMPUTER RELATED 0.40%
EMC Corp* 7,600 147,250
International Business Machines 2,700 291,262
-----------
438,512
-----------
CONTAINERS 1.65%
Premark International 100,000 1,800,000
-----------
COSMETICS & TOILETRIES 0.40%
Avon Products 10,000 440,000
-----------
<PAGE>
DIVERSIFIED COMPANIES 0.70%
Canadian Pacific Ltd CA 35,200 765,600
-----------
FOOD PRODUCTS & BEVERAGES 2.36%
Anheuser-Busch Cos 10,000 747,500
Heinz (H J) Co 39,400 1,305,125
Kellogg Co 7,000 523,250
-----------
2,575,875
-----------
INSURANCE 0.43%
Gallagher (Arthur J) & Co 15,000 472,500
-----------
JEWELRY 0.20%
Friedman's Inc Class A* 10,000 222,500
-----------
MACHINERY 2.48%
Goulds Pumps 122,000 2,714,500
-----------
MEDICAL RELATED - DRUGS 9.32%
Astra AB Series B Shrs SW 48,000 1,979,449
Boots Co PLC UK 126,000 1,169,320
Bristol-Myers Squibb 18,000 1,559,250
Lilly (Eli) & Co 12,000 672,000
Merck & Co 16,000 1,028,000
Sandoz AG Ltd Registered Shrs SZ 1,500 1,674,186
SmithKline Beecham PLC Sponsored ADR
Representing Ord A Shrs UK 19,000 1,021,250
Warner-Lambert Co 20,000 1,090,000
-----------
10,193,455
-----------
METALS & MINING 1.86%
Franco-Nevada Mining Ltd CA 12,000 366,719
Viceroy Resources* CA 310,000 1,669,153
-----------
2,035,872
-----------
OIL & GAS RELATED 11.26%
Alberta Energy Ltd CA 20,000 367,500
Coastal Corp 12,500 465,625
Elf Aquitaine Sponsored ADR FR 26,500 954,000
Enron Corp 10,000 393,750
Exxon Corp 12,000 987,000
Forcenergy Group AB Series B Shrs SW 600,000 4,358,419
NOVA Corp CA 70,400 598,400
Oceaneering International* 20,000 320,000
Oryx Energy* 25,000 393,750
Sonat Inc 50,000 2,131,250
Union Pacific Resources Group 20,000 527,500
Unocal Corp 25,000 815,625
-----------
12,312,819
-----------
<PAGE>
PAPER & PAPER PRODUCTS 0.81%
Potlatch Corp 23,500 881,250
-----------
RETAIL 4.48%
American Stores 25,000 931,250
Dollar General 20,000 517,500
Ingles Markets Class A 203,000 2,359,875
Saks Holdings* 35,000 1,085,000
-----------
4,893,625
-----------
TOYS & HOBBIES 0.34%
Mattel Inc 15,000 371,250
-----------
TRANSPORTATION 0.30%
Burlington Northern Santa Fe 4,100 323,388
-----------
UTILITIES 11.84%
ALLTEL Corp 26,600 728,175
Century Telephone Enterprises 12,200 388,875
Entergy Corp 10,000 255,000
Equitable Resources 60,000 1,522,500
FPL Group 15,000 680,625
IES Industries 139,500 4,115,250
Idaho Power 113,000 3,375,875
Oklahoma Gas & Electric 42,000 1,648,500
Piedmont Natural Gas 10,000 236,250
-----------
12,951,050
-----------
TOTAL COMMON STOCKS (Cost $61,966,860) 63,590,685
-----------
PREFERRED STOCKS 1.96%
INSURANCE 1.96%
Berkley (W R) Corp, Depository
Shrs Representing 1/6 Shr
7.375%, Series A Pfd
(Cost $2,159,375) 90,000 2,148,750
-----------
FIXED INCOME SECURITIES 30.10%
US Treasury Bonds 6.875%, 8/15/2025 3,000,000 2,946,558
US Treasury Notes 6.875%, 5/15/2006 5,000,000 5,029,680
5.625%, 10/31/1997 2,000,000 1,990,000
5.375%, 11/30/1997 3,000,000 2,972,808
-----------
TOTAL US GOVERNMENT OBLIGATIONS
(Cost $13,060,469) 12,939,046
-----------
Federal Home Loan Mortgage
Gold, Participation Certificates
7.000%, 8/1/2010 853,924 841,344
6.500%, 6/1/2010 1,764,058 1,714,010
6.500%, 8/1/2010 1,813,958 1,751,646
6.500%, 10/1/2010 1,863,070 1,799,071
<PAGE>
6.500%, 11/1/2010 1,888,968 1,824,080
6.500%, 4/1/2011 1,976,118 1,904,484
6.500%, 6/1/2011 9,999,515 9,637,033
Student Loan Marketing Association
Notes, Series CQ 4.570%, 3/7/2001 500,000 497,956
-----------
TOTAL US GOVERNMENT
AGENCY OBLIGATIONS
(Cost $20,251,959) 19,969,624
-----------
TOTAL FIXED INCOME SECURITIES
(Cost $33,312,428) 32,908,670
-----------
OPTIONS PURCHASED 0.47%
S&P 500 INDEX OPTIONS 0.47%
S&P 500 Puts 9/21/1996 625*
(Cost $651,750) 500~ 512,500
-----------
SHORT-TERM INVESTMENTS 9.31%
US Treasury Notes 6.125%, 5/31/1997
(Cost $2,017,812) 2,000,000 2,004,372
Repurchase Agreement with
State Street Bank & Trust Co
dated 7/31/1996 due 8/1/1996
at 5.500%, repurchased at
$8,175,249 (Collateralized
by US Treasury Bonds due
2/15/2019 at 8.875%, value
$8,612,872)
(Cost $8,174,000) 8,174,000 8,174,000
-----------
TOTAL SHORT-TERM INVESTMENTS
(Cost $10,191,812) 10,178,372
-----------
TOTAL INVESTMENT
SECURITIES AT VALUE 100.00%
(Cost $108,282,225)
(Cost for Income Tax Purposes
$108,376,377) 109,338,977
===========
MULTI-ASSET ALLOCATION Fund
COMMON STOCKS 68.54%
AEROSPACE & DEFENSE 0.76%
Lockheed Martin 389 32,238
McDonnell Douglas 800 35,800
Precision Castparts 100 4,337
-----------
72,375
-----------
<PAGE>
AUDIO/VIDEO RELATED 0.53%
Fuji Photo Film Ltd ADR 1,400 41,650
Harman International Industries 200 8,975
-----------
50,625
-----------
AUTOMOBILE RELATED 2.54%
Arvin Industries 500 10,812
Chrysler Corp 1,600 45,400
Exide Corp 200 5,375
Ford Motor 2,500 81,250
Gentex Corp* 400 7,500
PACCAR Inc 1,400 63,700
Toyota Motor ADR 600 29,100
-----------
243,137
-----------
BANKING 3.83%
BankAmerica Corp 1,100 87,725
CCB Financial 100 5,175
Chase Manhattan 928 64,496
Citicorp 600 49,125
Deposit Guaranty 300 13,725
HSBC Holdings PLC Sponsored ADR 100 15,970
Magna Group 1,000 22,500
National Australia Bank Ltd
Sponsored ADR 800 36,500
NationsBank Corp 600 51,525
Provident Bankshares 300 9,600
Riggs National 800 10,550
-----------
366,891
-----------
BIOTECHNOLOGY 0.17%
CellPro Inc* 900 12,037
Mycogen Corp* 300 4,612
-----------
16,649
-----------
BROADCASTING 0.11%
Renaissance Communications* 300 10,350
-----------
BUILDING & CONSTRUCTION RELATED 0.71%
Granite Construction 300 6,337
Lennar Corp 400 8,950
Medusa Corp 300 8,775
Oakwood Homes 200 4,725
Sekisui House Ltd ADR 300 32,888
Texas Industries 100 6,700
-----------
68,375
-----------
<PAGE>
BUSINESS SERVICES 0.73%
American Express 1,200 52,500
Catalina Marketing* 400 17,600
-----------
70,100
-----------
CHEMICALS 2.56%
Bayer AG Sponsored ADR 1,500 50,414
Dexter Corp 200 5,875
Hoechst AG ADR 500 16,475
Mallinckrodt Group 1,100 41,112
Morton International 1,100 39,600
Olin Corp 700 59,325
Sterling Chemicals* 600 6,975
Union Carbide Holding 600 25,200
-----------
244,976
-----------
CLEANING PRODUCTS 0.85%
Clorox Co 300 27,262
Procter & Gamble 600 53,625
-----------
80,887
-----------
COMPUTER RELATED 3.25%
BancTec Inc* 300 6,300
Cabletron Systems* 600 34,350
Computer Associates International 675 34,341
Comshare Inc 400 6,950
Continuum Co* 100 5,375
Control Data Systems* 300 5,362
Dell Computer* 400 22,200
Electronics For Imaging* 100 5,825
Gerber Scientific 700 10,325
International Business Machines 800 86,300
Microsoft Corp* 300 35,362
National Data 300 11,925
Network General* 200 3,525
Rational Software* 100 4,437
Seagate Technology* 600 29,025
Stratus Computer* 300 5,512
Structural Dynamics Research* 200 3,425
-----------
310,539
-----------
CONTAINERS 0.37%
Amcor Ltd Sponsored ADR 800 19,500
Intertape Polymer Group 100 1,812
West Co 600 14,100
-----------
35,412
-----------
<PAGE>
CONTROL INSTRUMENTS 0.16%
International Rectifier* 900 15,075
-----------
COSMETICS & TOILETRIES 0.15%
Alberto Culver Class B 200 8,625
Carter-Wallace Inc 500 5,875
-----------
14,500
-----------
DIVERSIFIED COMPANIES 1.84%
Bass PLC ADR 400 10,050
du Pont (E I) de Nemours 700 56,525
Laidlaw Inc Class B 2,100 19,425
Sara Lee 1,300 41,600
Textron Inc 600 48,000
-----------
175,600
-----------
ELECTRICAL EQUIPMENT 0.12%
Belden Inc 400 11,000
-----------
ELECTRONICS 1.79%
BMC Industries 300 8,212
Bell Industries 335 5,611
Intel Corp 900 67,612
Matsushita Electric Industrial ADR 100 17,100
Moog Inc Class A* 300 6,300
Network Equipment Technologies* 200 2,650
SCI Systems* 700 24,412
TDK Corp ADR 300 17,212
Tech-Sym Corp* 200 5,300
Teleflex Inc 400 17,700
-----------
172,109
-----------
FINANCE RELATED 0.72%
CMAC Investment 100 5,738
Federal Home Loan Mortgage 600 50,550
Mutual Risk Management 266 7,481
PHH Corp 100 5,325
-----------
69,094
-----------
FOOD PRODUCTS & BEVERAGES 3.20%
Coca-Cola Co 1,400 65,625
Coca-Cola Enterprises 1,900 66,975
Dean Foods 1,500 36,562
Kirin Brewery Ltd ADR 300 36,225
Nestle SA Sponsored ADR
Representing Registered Shrs 400 22,900
<PAGE>
Unigate PLC ADR 5,600 35,707
Unilever NV New York Shrs 300 42,675
-----------
306,669
-----------
FURNITURE 0.14%
Furniture Brands International* 1,200 13,650
-----------
HEALTH CARE RELATED 0.24%
Medaphis Corp* 200 7,425
Universal Health Services Class B* 600 15,375
-----------
22,800
-----------
HEALTH MAINTENANCE ORGANIZATIONS 0.05%
Sierra Health Services* 200 5,250
-----------
HOTELS 0.61%
American General Hospitality* 1,500 26,625
ITT Corp* 400 22,700
Prime Hospitality* 500 8,875
-----------
58,200
-----------
INSURANCE 3.53%
ACE Ltd 1,300 57,200
AEGON NV ADR 500 22,937
American Bankers Insurance Group 500 20,000
Bankers Life Holding 300 6,900
Frontier Insurance Group 440 14,905
Horace Mann Educators 200 6,250
ITT Hartford Group 1,300 68,737
Lawyers Title 300 6,000
Loews Corp 900 72,562
Orion Capital 100 4,900
PennCorp Financial Group 700 19,600
Protective Life 900 30,937
United Cos Financial 200 6,600
-----------
337,528
-----------
INVESTMENT BROKERS 0.12%
Alex Brown 100 4,675
Raymond James Financial 300 6,263
-----------
10,938
-----------
MACHINERY 0.58%
Bearings Inc 200 5,500
Giddings & Lewis 1,100 12,787
JLG Industries 600 11,100
<PAGE>
Tecumseh Products Class A 500 25,750
-----------
55,137
-----------
MANUFACTURING 0.49%
Foamex International* 800 9,600
Moet Hennessy Louis Vuitton
Sponsored ADR 700 31,237
Scotsman Industries 300 5,962
-----------
46,799
-----------
MEDICAL RELATED 1.89%
Advanced Technology Laboratories* 200 6,450
Baxter International 1,700 70,763
Johnson & Johnson 1,400 66,850
Jones Medical Industries 200 6,925
Kinetic Concepts 800 11,200
OEC Medical Systems* 400 4,700
Patterson Dental* 300 8,737
Renal Treatment Centers* 200 5,600
-----------
181,225
-----------
MEDICAL RELATED - DRUGS 3.09%
Bergen Brunswig Class A 200 5,200
Bristol-Myers Squibb 500 43,313
CIBA-GEIGY Ltd Sponsored ADR 400 23,800
Glaxo Wellcome PLC Sponsored ADR 1,000 27,750
Lilly (Eli) & Co 1,500 84,000
NeXstar Pharmaceuticals* 1,100 18,975
Novo-Nordisk A/S ADR 1,100 39,875
Pharmacia & Upjohn 1,285 53,006
-----------
295,919
-----------
METALS & MINING 0.78%
AK Steel Holding 900 32,963
CRA Ltd Sponsored ADR 400 22,567
Nucor Corp 400 18,750
-----------
74,280
-----------
MOTION PICTURES & TELEVISION 0.53%
Disney (Walt) Co 914 50,841
-----------
OIL & GAS RELATED 5.40%
Amoco Corp 700 46,813
Baker Hughes 1,000 29,375
Camco International 400 12,950
Chevron Corp 500 28,938
Coastal Corp 800 29,800
Elf Aquitaine Sponsored ADR 1,400 50,400
Exxon Corp 200 16,450
<PAGE>
Mobil Corp 700 77,263
Repsol SA Sponsored ADR 600 20,025
Royal Dutch Petroleum
5 Gldr New York Shrs 700 105,613
Santa Fe Energy Resources* 2,200 25,025
Shell Transport & Trading PLC
New York Shrs 400 34,700
Smith International* 200 6,700
Valero Energy 1,600 33,000
-----------
517,052
-----------
PAPER & PAPER PRODUCTS 0.47%
Domtar Inc 1,200 9,000
Fibreboard Corp* 200 5,275
International Paper 800 30,300
-----------
44,575
-----------
POLLUTION CONTROL RELATED 0.10%
US Filter* 450 9,731
-----------
PRINTING & PUBLISHING 0.74%
Media General Class A 400 11,450
South China Morning Post
Holdings Ltd Sponsored ADR 4,300 14,179
Times Mirror Series A 1,100 45,513
-----------
71,142
-----------
REAL ESTATE RELATED 12.57%
Bay Apartment Communities 2,000 50,750
Beacon Properties 1,500 39,375
CBL & Associates Properties 1,300 28,113
Cali Realty 1,200 27,750
CarrAmerica Realty 1,200 28,800
CenterPoint Properties 1,000 27,000
Chelsea GCA Realty 900 25,988
Colonial Properties Trust SBI 1,600 39,600
Crown American Realty Trust 3,500 28,875
Duke Realty Investments 1,700 50,575
Equity Residential Properties Trust SBI 800 27,000
FelCor Suite Hotels 900 25,200
First Industrial Realty Trust 1,300 30,550
Gables Residential Trust SBI 2,100 49,350
Highwoods Properties 1,300 35,913
Horizon Group 1,276 26,477
JDN Realty 1,600 35,000
Kimco Realty 1,450 40,419
Koger Equity* 2,600 36,075
Liberty Property Trust SBI 2,300 45,713
MGI Properties 2,200 38,225
Meditrust SBI 800 27,200
Merry Land & Investment 700 14,700
<PAGE>
Nationwide Health Properties 1,000 22,250
Oasis Residential 1,400 30,275
Patriot American Hospitality 1,900 53,913
Public Storage 3,200 68,400
RFS Hotel Investors 1,600 25,600
Regency Realty 1,000 20,500
Shurgard Storage Centers Class A 1,000 23,625
Simon Property Group 1,100 25,850
Spieker Properties 500 14,250
Starwood Lodging Trust 1,400 47,600
Sun Communities 1,200 33,600
Sun Hung Kai Properties Ltd
Sponsored ADR 2,500 23,599
Wellsford Residential Property
Trust SBI 1,600 34,800
-----------
1,202,910
-----------
RECREATION PRODUCTS & SERVICES 0.59%
AMC Entertainment* 600 11,175
GTECH Holdings* 1,200 33,150
Outboard Marine 800 12,500
-----------
56,825
-----------
RETAIL 3.13%
Apple South 300 6,113
Applebee's International 200 5,025
Carson Pirie Scott* 400 8,900
Casey's General Stores 500 8,438
Dayton Hudson 1,800 54,450
Federated Department Stores* 1,500 45,375
Great Atlantic & Pacific Tea 700 19,338
Just For Feet* 200 7,850
Koninklijke Ahold NV Sponsored ADR 714 36,236
Lowe's Cos 800 26,100
Marui Co Ltd ADR 600 25,074
Penney (J C) Co 600 29,850
Ross Stores 300 8,850
The Men's Wearhouse* 800 14,100
Waban Inc* 200 3,800
-----------
299,499
-----------
SAVINGS & LOAN 0.33%
ALBANK Financial 1,260 31,658
-----------
SEMICONDUCTOR EQUIPMENT 0.06%
Dallas Semiconductor 300 5,287
-----------
SCHOOLS 0.06%
Kinder-Care Learning Centers* 400 6,075
-----------
<PAGE>
SCIENTIFIC INSTRUMENTS 0.07%
Dionex Corp* 200 6,950
-----------
TELECOMMUNICATIONS 1.04%
AT&T Corp 1,200 62,550
Aspect Telecommunications* 100 4,825
Digital Systems International* 300 4,500
InterDigital Communications* 1,400 9,625
Societa Finanziaria Telefonica
SpA Sponsored ADR 600 18,375
-----------
99,875
-----------
TEXTILES & APPAREL MANUFACTURERS 0.68%
G & K Services Class A 200 5,375
Springs Industries Class A 200 9,125
VF Corp 900 50,288
-----------
64,788
-----------
TOBACCO 1.11%
Philip Morris 800 83,700
Universal Corp 800 22,200
-----------
105,900
-----------
TRANSPORTATION 0.80%
Alaska Air Group* 300 7,200
Burlington Northern Santa Fe 500 39,438
Heartland Express 500 13,000
Swire Pacific Ltd Sponsored ADR
Representing Class A Shrs 2,000 16,800
-----------
76,438
-----------
UTILITIES 4.48%
Ameritech Corp 1,300 72,150
Atlantic Tele-Network 600 12,600
British Telecommunications PLC ADR 300 16,950
Cincinnati Bell 800 38,900
Commonwealth Energy Systems SBI 400 9,200
Empresa Nacional de Electricidad
SA Sponsored ADR 300 17,550
GTE Corp 1,200 49,500
General Public Utilities 800 26,000
IES Industries 300 8,850
MCN Corp 1,200 28,200
MidAmerican Energy 1,600 27,200
Minnesota Power & Light 200 5,525
ONEOK Inc 300 7,913
PacifiCorp 1,300 27,138
PowerGen PLC Sponsored ADR 250 7,688
Southern Electric PLC Sponsored ADR 558 5,726
<PAGE>
Sprint Corp 700 25,638
Telefonica de Espana SA Sponsored ADR 800 41,800
-----------
428,528
-----------
WHOLESALE 0.47%
Inchcape Berhad ADR 7,700 23,430
Richfood Holdings 400 13,550
World Fuel Services 500 8,313
-----------
45,293
-----------
TOTAL COMMON STOCKS
(Cost $5,804,114) 6,559,456
-----------
FIXED INCOME SECURITIES 29.47%
US Treasury Bonds
8.750%, 5/15/2017 175,000 206,500
7.500%,11/15/2016 180,000 188,043
US Treasury Notes
7.875%, 11/15/2004+ 75,000 80,273
7.500%, 11/15/2001 15,000 15,591
6.250%, 5/31/2000 265,000 262,681
6.250%, 2/15/2003 210,000 205,472
5.750%, 9/30/1997 20,000 19,950
5.625%, 8/31/1997 230,000 229,138
5.625%, 11/30/2000 65,000 62,806
5.500%, 9/30/1997 250,000 248,672
5.375%, 11/30/1997 280,000 277,462
5.250%, 12/31/1997 150,000 148,313
5.125%, 11/30/1998 245,000 238,645
-----------
TOTAL US GOVERNMENT OBLIGATIONS
(Cost $2,191,863) 2,183,546
-----------
Federal Home Loan Mortgage
Gold, Participation Certificates
9.000%, 1/1/2007 39,366 41,172
Federal Home Loan Mortgage
Participation Certificates
9.000%, 1/1/2005 30,413 31,691
8.000%, 8/1/2017 40,511 41,249
Federal National Mortgage
Association Gtd Pass-Through
Certificates 7.000%, 5/25/2006 55,000 55,020
6.000%, 4/1/2011 49,385 46,529
6.000%, 4/1/2024 46,979 42,772
Government National Mortgage
Association I, Pass-Through
Certificates 6.500%, 12/31/1999~~ 75,000 69,445
-----------
TOTAL US GOVERNMENT AGENCY OBLIGATIONS
(Cost $329,891) 327,878
-----------
<PAGE>
FINANCE RELATED 0.24%
Money Store Home Equity Trust,
Series 1994B, Class A3
7.100%, 11/15/2016 (Cost $22,062) 23,072 23,142
-----------
ELECTRONICS 0.29%
Motorola Inc, Deb 8.400%, 8/15/2031 25,000 27,704
-----------
FINANCE RELATED 0.55%
Associates Corp of North America
Sr Deb, Series A
7.950%, 2/15/2010 50,000 52,762
-----------
POLLUTION CONTROL RELATED 0.43%
WMX Technologies Step-Up Discount
Notes^^ 6.220%, 4/30/2004 40,000 41,265
-----------
TELECOMMUNICATIONS 0.51%
BellSouth Telecommunications
Deb, 5.850%, 11/15/2045 50,000 48,313
-----------
UTILITIES 1.21%
GTE Corp, Deb 10.250%, 11/1/2020 50,000 56,845
U S WEST Capital Funding
Notes, 6.310%, 11/1/2005 60,000 59,054
-----------
115,899
-----------
TOTAL CORPORATE BONDS
(Cost $280,726) 285,943
(Cost $2,824,542) 2,820,509
-----------
SHORT-TERM INVESTMENTS -
REPURCHASE AGREEMENTS 1.99%
Repurchase Agreement with
State Street Bank & Trust Co
dated 7/31/1996 due 8/1/1996
at 4.750%, repurchased at
$190,025 (Collateralized
by US Treasury Notes due
3/31/1998 at 6.125%, value
$202,548)
(Cost $190,000) 190,000 190,000
-----------
TOTAL INVESTMENT
SECURITIES AT VALUE 100.00%
(Cost $8,818,656)
(Cost for Income Tax Purposes
$8,843,315) 9,569,965
===========
* Security is non-income producing.
~ Number of contracts.
<PAGE>
^^ Step up bonds are obligations which increase
the interest payment rate at a specific point
in time. Rate shown reflects current rate which
may step up at a future date.
+ Security has been designated as collateral
for To - Be - Announced (TBA) securities.
~~ Security is a To-Be-Announced (TBA) security.
Summary of Investments by Country
% of
Country Investment
Country Code Securities Value
- -----------------------------------------------------------------
Canada CA 5.18% $ 5,661,122
France FR 0.87 954,000
Sweden SW 5.80 6,337,868
Switzerland SZ 1.53 1,674,186
United Kingdom UK 4.91 5,370,947
United States US 81.71 89,340,854
------------------------
100.00% $109,338,977
========================
See Notes to Financial Statements
<PAGE>
INVESCO Multiple Asset Funds, Inc.
Statement of Assets and Liabilities
July 31, 1996
Balanced Multi-Asset
Fund Allocation Fund
------------------------------------
ASSETS
Investment Securities:
At Cost~ $108,282,225 $8,818,656
====================================
At Value~ $109,338,977 $ 9,569,965
Cash 4,129,764 26,798
Appreciation on Forward
Foreign Currency Contracts 318 0
Receivables:
Investment Securities Sold 1,419,684 1,884
Fund Shares Sold 351,265 4,186
Dividends and Interest 492,547 51,783
Prepaid Expenses and Other Assets 35,359 8,528
------------------------------------
TOTAL ASSETS 115,767,914 9,663,144
====================================
LIABILITIES
Payables:
Distributions to Shareholders 23,396 1,445
Investment Securities Purchased 523,670 70,029
Fund Shares Repurchased 106,590 1,364
Accrued Distribution Expenses 25,250 2,156
Accrued Expenses and Other Payables 23,157 14,570
------------------------------------
TOTAL LIABILITIES 702,063 89,564
------------------------------------
Net Assets at Value 115,065,851 9,573,580
====================================
NET ASSETS
Paid-in Capital* 106,892,959 8,289,836
Accumulated Undistributed
Net Investment Income 10,019 1,204
Accumulated Undistributed Net
Realized Gain on Investment
Securities and Foreign
Currency Transactions 7,105,541 531,231
Net Appreciation of Investment
Securities and Foreign
Currency Transactions 1,057,332 751,309
------------------------------------
Net Assets at Value 115,065,851 9,573,580
====================================
Shares Outstanding 8,610,364 828,624
Net Asset Value, Offering and
Redemption Price per Share 13.36 11.55
====================================
<PAGE>
~ Investment securities at cost and value at July 31, 1996 include repurchase
agreements of $8,174,000 and $190,000 for Balanced and Multi-Asset Allocation
Funds, respectively.
* The Fund has 500 million authorized shares of common stock, par value of $0.01
per share. Of such shares, 100 million have been allocated to each individual
Fund.
See Notes to Financial Statements
<PAGE>
INVESCO Multiple Asset Funds, Inc.
Statement of Operations
Year Ended July 31, 1996
Balanced Multi-Asset
Fund Allocation Fund
------------------------------------
INVESTMENT INCOME
INCOME
Dividends $1,747,428 $187,849
Interest 2,274,898 180,310
Foreign Taxes Withheld (18,627) (4,141)
------------------------------------
TOTAL INCOME 4,003,699 364,018
------------------------------------
EXPENSES
Investment Advisory Fees 561,473 69,539
Distribution Expenses 233,947 23,180
Transfer Agent Fees 203,967 25,922
Administrative Fees 24,037 11,391
Custodian Fees and Expenses 55,135 12,933
Directors' Fees and Expenses 11,146 8,410
Professional Fees and Expenses 27,253 15,992
Registration Fees and Expenses 50,458 26,402
Reports to Shareholders 34,531 4,698
Other Expenses 9,434 9,187
------------------------------------
TOTAL EXPENSES 1,211,381 207,654
Fees and Expenses Absorbed
by Investment Adviser (5,341) (57,448)
Fees and Expenses Paid Indirectly (37,180) (11,128)
------------------------------------
NET EXPENSES 1,168,860 139,078
NET INVESTMENT INCOME 2,834,839 224,940
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENT SECURITIES
Net Realized Gain on Investment
Securities and Foreign Currency
Transactions 11,022,562 665,235
Change in Net Appreciation
(Depreciation) of Investment
Securities and Foreign Currency
Transactions (1,554,333) 18,014
------------------------------------
NET GAIN ON INVESTMENT SECURITIES 9,468,229 683,249
------------------------------------
Net Increase in Net Assets
from Operations 12,303,068 908,189
====================================
See Notes to Financial Statements
<PAGE>
INVESCO Multiple Asset Funds, Inc.
Statement of Changes in Net Assets
Year Ended July 31
<TABLE>
<CAPTION>
Balanced Multi-Asset
Fund Allocation Fund
---------------------------------- -------------------------------
1996 1995 1996 1995
<S> <C> <C> <C> <C>
OPERATIONS
Net Investment Income $2,834,839 $583,535 $224,940 $189,768
Net Realized Gain on Investment Securities
and Foreign Currency Transactions 11,022,562 1,418,230 665,235 29,725
Change in Net Appreciation (Depreciation) of
Investment Securities and Foreign Currency
Transactions (1,554,333) 2,592,041 18,014 760,284
---------------------------------- ------------------------------
NET INCREASE IN NET
ASSETS FROM OPERATIONS 12,303,068 4,593,806 908,189 979,777
DISTRIBUTIONS TO SHAREHOLDERS
Net Investment Income (2,832,865) (582,562) (225,039) (188,119)
Net Realized Gain on Investment Securities (5,048,134) (282,472) (147,924) 0
---------------------------------- ------------------------------
TOTAL DISTRIBUTIONS (7,880,999) (865,034) (372,963) (188,119)
---------------------------------- ------------------------------
FUND SHARE TRANSACTIONS
Proceeds from Sales of Shares 201,328,435 45,998,807 13,724,833 6,069,861
Reinvestment of Distributions 7,491,818 852,931 366,691 185,398
---------------------------------- ------------------------------
208,820,253 46,851,738 14,091,524 6,255,259
Amounts Paid for Repurchases of Shares (135,399,982) (17,609,298) (12,831,534) (4,226,678)
---------------------------------- ------------------------------
NET INCREASE IN NET ASSETS
FROM FUND SHARE TRANSACTIONS 73,420,271 29,242,440 1,259,990 2,028,581
---------------------------------- ------------------------------
Total Increase in Net Assets 77,842,340 32,971,212 1,795,216 2,820,239
NET ASSETS
Beginning of Period 37,223,511 4,252,299 7,778,364 4,958,125
---------------------------------- ------------------------------
End of Period 115,065,851 37,223,511 9,573,580 7,778,364
================================== ==============================
Accumulated Undistributed Net Investment
Income Included in Net Assets at
End of Period 10,019 906 1,204 2,129
================================== ==============================
<PAGE>
FUND SHARE TRANSACTIONS
Shares Sold 14,985,724 4,158,603 1,194,602 614,282
Shares Issued from Reinvestment
of Distributions 564,187 76,830 32,203 18,428
---------------------------------- ------------------------------
15,549,911 4,235,433 1,226,805 632,710
Shares Repurchased (10,019,968) (1,568,041) (1,115,680) (427,487)
---------------------------------- ------------------------------
Net Increase in Fund Shares 5,529,943 2,667,392 111,125 205,223
================================== ==============================
See Notes to Financial Statements
</TABLE>
<PAGE>
INVESCO Multiple Asset Funds, Inc.
Notes to Financial Statements
NOTE 1 - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES. INVESCO Multiple
Asset Funds, Inc. (the "Fund"), was incorporated in Maryland on August 19, 1993
and presently consists of two separate Funds: Balanced Fund and Multi-Asset
Allocation Fund. The investment objectives of the Funds are to achieve a high
total return on investment through capital appreciation and current income. The
Fund is registered under the Investment Company Act of 1940 (the "Act") as a
diversified, open-end management investment company.
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of income and expenses during the reporting period. Actual
results could differ from those estimates.
A. SECURITY VALUATION - Equity securities traded on national securities
exchanges or in the over-the-counter market are valued at the last sales
price in the market where such securities are primarily traded. If last
sales prices are not available, securities are valued at the highest closing
bid price obtained from one or more dealers making a market for such
securities or by a pricing service approved by the Fund's board of
directors.
Debt securities are valued at evaluated bid prices as determined by a
pricing service approved by the Fund's board of directors. If evaluated
bid prices are not available, debt securities are valued by averaging
the bid prices obtained from one or more dealers making a market for
such securities.
Foreign securities are valued at the closing price on the principal
stock exchange on which they are traded. In the event that closing
prices are not available for foreign securities, prices will be
obtained from the principal stock exchange at or prior to the close of
the New York Stock Exchange. Foreign currency exchange rates are
determined daily prior to the close of the New York Stock Exchange.
Options are valued at the last sales price on the principal exchange
on which the options are traded. If there is no last sales price
reported, then the bid price will be used.
If the market quotations or pricing service valuations are not
readily available, securities are valued at fair value as determined in
good faith by the Fund's board of directors.
Short-term securities are stated at amortized cost (which
approximates market value) if maturity is 60 days or less at the time
of purchase, or market value if maturity is greater than 60 days.
Assets and liablities initially expressed in terms of foreign
currencies are translated into U.S. dollars at the prevailing market
rates as quoted by one or more banks or dealers on the date of
valuation. The cost of securities is translated into U.S. dollars at
the rate of exchange prevailing when such securities were acquired.
Income and expenses are translated into U.S. dollars at rates of
exchange prevailing when accrued.
B. TO-BE-ANNOUNCED SECURITIES - To-Be-Announced ("TBA") securities held by
the Fund are fully collateralized by other securities and such collateral
is in the possession of the Fund's Custodian. The collateral is evaluated
daily to ensure its market value exceeds the current market value of the
TBA securities.
<PAGE>
C. REPURCHASE AGREEMENTS - Repurchase agreements held by the Fund are fully
collateralized by U.S. Government securities and such collateral is in the
possession of the Fund's custodian. The collateral is evaluated daily to
ensure its market value exceeds the current market value of the repurchase
agreements including accrued interest.
D. OPTIONS - The Balanced Fund may hold options for investment purposes
with the intent to hedge the portfolio against ongoing exposure to
market value and interest rate fluctuations.
The use of such instruments may involve certain risks as a result of
unanticipated movements in the market. A lack of correlation between
the value of an instrument underlying an option and the asset being
hedged, or unexpected adverse price movements, could render the
Balanced Fund's hedging strategy unsuccessful. In addition, there can
be no assurance that a liquid secondary market will exist for any
option purchased or sold. Realized gains or losses on purchased option
transactions are included in Net Realized Gain (Loss) on Investment
Securities and Foreign Currency Transactions in the Statement of
Operations.
E. SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME - Security transactions
are accounted for on the trade date and dividend income is recorded on the
ex dividend date. Certain dividends from foreign securities will be recorded
as soon as the Fund is informed of the dividend if such information is
obtained subsequent to the ex dividend date. Interest income, which may be
comprised of stated coupon rate, market discount and original issue discount
is recorded on the accrual basis. Discounts on debt securities purchased
are amortized over the life of the respective security as adjustments to
interest income. Cost is determined on the specific identification basis.
The Fund may have elements of risk due to concentrated investments in
foreign issuers located in a specific country. Such concentrations may
subject the Fund to additional risks resulting from future political or
economic conditions and/or possible impositions of adverse foreign
governmental laws or currency exchange restrictions. Net realized and
unrealized gain or loss from investments includes fluctuations from
currency exchange rates and fluctuations in market value.
The Fund's use of short-term forward foreign currency contracts may
subject it to certain risks as a result of unanticipated movements in
foreign exchange rates. The Fund does not hold short-term forward
foreign currency contracts for trading purposes. The Fund may hold
foreign currency in anticipation of settling foreign security
transactions and not for investment purposes.
Investments in securities of governmental agencies may only be
guaranteed by the respective agency's limited authority to borrow from
the U.S. Government and may not be guaranteed by the full faith and
credit of the United States.
F. FEDERAL AND STATE TAXES - The Fund has complied and continues to comply
with the provisions of the Internal Revenue Code applicable to
regulated investment companies and, accordingly, has made or intends to
make sufficient distributions of net investment income and net realized
capital gains, if any, to relieve it from all federal and state income
taxes and federal excise taxes.
<PAGE>
To the extent future capital gains are offset by capital loss
carryovers and deferred post-October 31 losses, such gains will not be
distributed to shareholders.
Dividends paid by the Fund from net investment income and
distributions of net realized short-term capital gains are, for federal
income tax purposes, taxable as ordinary income to shareholders. Of the
ordinary income distributions declared for the year ended July 31,
1996, 17.10% for Balanced Fund and 31.01% for Multi-Asset Allocation
Fund qualified for the dividends received deduction available to the
Fund's corporate shareholders.
Investment income received from foreign sources may be subject to
foreign withholding taxes. Dividend and interest income is shown gross
of foreign withholding taxes in the accompanying financial statements.
G. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS - Dividends and distributions to
shareholders are recorded by the Fund on the ex dividend/distribution date.
The Fund distributes net realized capital gains, if any, to its shareholders
at least annually, if not offset by capital loss carryovers. Income
distributions and capital gain distributions are determined in
accordance with income tax regulations which may differ from generally
accepted accounting principles. These differences are primarily due to
differing treatments for mortgage-backed securities, market discount,
foreign currency transactions, nontaxable dividends, net operating losses
and expired capital loss carryforwards. During the year ended July 31, 1996,
Balanced Fund reclassified $7,139 from accumulated undistributed net
realized gain on investment securities and foreign currency transactions to
accumulated undistributed net investment income. During the year ended July
31, 1996, Multi-Asset Allocation Fund reclassified $820 from accumulated
undistributed net investment income to accumulated undistributed net
realized gain on investment securities and foreign currency transactions.
Net investment income, net realized gains, paid-in capital and net assets
were not affected.
H. FORWARD FOREIGN CURRENCY CONTRACTS - The Fund enters into short-term forward
foreign currency contracts in connection with planned purchases or sales of
securities as a hedge against fluctuations in foreign exchange rates pending
the settlement of transactions in foreign securities. A forward foreign
currency contract is an agreement between contracting parties to exchange an
amount of currency at some future time at an agreed upon rate. These
contracts are marked-to-market daily and the related appreciation or
depreciation of the contracts is presented in the Statement of Assets and
Liabilites.
I. EXPENSES - Each of the Funds bears expenses incurred specifically on its
behalf and, in addition, each Fund bears a portion of general expenses,
based on the relative net assets of each Fund.
Under an agreement between each Fund and the Fund's Custodian, agreed
upon Custodian Fees and Expenses are reduced by credits granted by the
Custodian from any temporarily uninvested cash. Similarly, Other
Expenses, which include Pricing Expenses, are reduced by credits earned
by each Fund from security brokerage transactions under certain
broker/service arrangements with third parties. Such credits are
included in Fees and Expenses Paid Indirectly in the Statement of
Operations.
<PAGE>
For the year ended July 31, 1996, Fees and Expenses Paid Indirectly
consisted of the following:
Custodian Fees Other
Fund and Expenses Expenses
- ---------------------------------------------------------------------
Balanced Fund $35,121 $2,059
Multi-Asset Allocation Fund 5,486 5,642
NOTE 2 - INVESTMENT ADVISORY AND OTHER AGREEMENTS. INVESCO Funds Group, Inc.
("IFG") serves as the Fund's investment adviser. As compensation for its
services to the Fund, IFG receives an investment advisory fee which is accrued
daily at the applicable rate and paid monthly. For Balanced Fund, the fee is
based on the annual rate of 0.60% on the first $350 million of average net
assets; reduced to 0.55% on the next $350 million of average net assets; and
0.50% on average net assets in excess of $700 million. For Multi-Asset
Allocation Fund, the fee is based on the annual rate of 0.75% on the first $500
million of average net assets; reduced to 0.65% on the next $500 million of
average net assets; and 0.50% on average net assets in excess of $1 billion. In
accordance with a Sub-Advisory Agreement between IFG and INVESCO Trust Company
("ITC"), a wholly owned subsidiary of IFG, investment decisions of Balanced Fund
are made by ITC. In a separate Sub-Advisory Agreement between IFG and INVESCO
Management & Research, Inc. ("IMR"), an affiliate of IFG, investment decisions
of Multi-Asset Allocation Fund are made by IMR. Fees for such sub-advisory
services are paid by IFG.
In accordance with an Administrative Agreement, each Fund pays IFG an annual
fee of $10,000, plus an additional amount computed at an annual rate of 0.015%
of average net assets to provide administrative, accounting and clerical
services. The fee is accrued daily and paid monthly.
IFG received a transfer agent fee at an annual rate of $14.00 per
shareholder account, or per participant in an omnibus account through April 30,
1996. IFG may pay such fee for participants in omnibus accounts to affiliates
or third parties.
The fee is paid monthly at one-twelfth of the annual fee and is based upon
the actual number of accounts in existence during each month. As of May 1, 1996,
the transfer agent fee became $20.00 per shareholder account or, where
applicable, per participant in an omnibus account, per year, computed in a
manner similar to the previous fee.
A plan of distribution pursuant to Rule 12b-1 of the Act provides for
reimbursement of marketing and advertising expenditures to IFG (the
"Distributor") to a maximum of 0.25% of average annual net assets. Amounts
accrued by the Fund are available to reimburse the Distributor for actual
expenditures incurred within a rolling twelve-month period. For the year ended
July 31, 1996, Balanced and Multi-Asset Allocation Funds paid the Distributor
$216,431 and $22,633, respectively, for reimbursement of expenses incurred.
IFG and ITC have voluntarily agreed, in some instances, to absorb certain
fees and expenses incurred by Balanced Fund and IFG and IMR have voluntarily
agreed, in some instances, to absorb certain fees and expenses incurred by
Multi-Asset Allocation Fund.
NOTE 3 - PURCHASES AND SALES OF INVESTMENT SECURITIES. For the year ended July
31, 1996, the aggregate cost of purchases and proceeds from sales of investment
securities (excluding all U.S. Government securities and short-term securities)
were as follows:
<PAGE>
Fund Purchases Sales
- --------------------------------------------------------------------------------
Balanced Fund $212,379,808 $183,553,074
Multi-Asset Allocation Fund 5,361,073 4,855,836
For the year ended July 31, 1996, the aggregate cost of purchases and proceeds
from sales of U.S. Government securities were as follows:
Fund Purchases Sales
- --------------------------------------------------------------------------------
Balanced Fund $51,588,211 $24,905,529
Multi-Asset Allocation Fund 4,330,771 2,866,944
NOTE 4 - APPRECIATION AND DEPRECIATION. At July 31, 1996, the gross appreciation
of securities in which there was an excess of value over tax cost, the gross
depreciation of securities in which there was an excess of tax cost over value
and the resulting net appreciation by Fund were as follows:
Gross Gross Net
Fund Appreciation Depreciation Appreciation
- --------------------------------------------------------------------------------
Balanced Fund $3,098,255 $2,135,655 $962,600
Multi-Asset Allocation Fund 952,300 225,650 726,650
NOTE 5 - TRANSACTIONS WITH AFFILIATES. Certain of the Fund's officers and
directors are also officers and directors of IFG, ITC or IMR.
The Fund has adopted an unfunded deferred compensation plan covering all
independent directors of the Fund who will have served as an independent
director for at least five years at the time of retirement. Benefits under this
plan were based on an annual rate equal to 25% of the retainer fee at the time
of retirement. As of July 1, 1996, benefits are based on an annual rate of 40%
of the retainer fee at the time of retirement.
Pension expenses for the year ended July 31, 1996, included in Directors'
Fees and Expenses in the Statement of Operations, and unfunded accrued pension
costs and pension liability included in Prepaid Expenses and Accrued Expenses,
respectively, in the Statement of Assets and Liabilities were as follows:
Unfunded
Pension Accrued Pension
Fund Expenses Pension Costs Liability
- --------------------------------------------------------------------------------
Balanced Fund $496 $(13) $740
Multi-Asset Allocation Fund 67 (65) 2
NOTE 6 - LINE OF CREDIT. The Fund has available a Redemption Line of Credit
Facility ("LOC"), from a consortium of national banks, to be used for temporary
or emergency purposes of the fund redemptions of investor shares. The LOC
permits borrowings to a maximum of 10% of the Net Assets at Value of each
respective Fund. Each Fund agrees to pay annual fees and interest on the unpaid
principal balance based on prevailing market rates as defined in the agreement.
For the year ended July 31, 1996, there were no such borrowings.
<PAGE>
INVESCO Multiple Asset Funds, Inc.
Financial Highlights
(For a Fund Share Outstanding Throughout Each Period)
Period
Ended
Year Ended July 31 July 31
------------------------ -----------
1996 1995 1994^
Balanced Fund
PER SHARE DATA
Net Asset Value -
Beginning of Peri $12.08 $10.30 $10.00
------------------------ ------------
INCOME FROM INVESTMENT
OPERATIONS
Net Investment Income 0.37 0.29 0.12
Net Gains on Securities
(Both Realized and
Unrealized) 2.12 2.03 0.30
------------------------ ------------
Total from Investment
Operations 2.49 2.32 0.42
------------------------ ------------
LESS DISTRIBUTIONS
Dividends from Net
Investment Income 0.37 0.29 0.12
Distributions from
Capital Gains 0.84 0.25 0.00
------------------------ ------------
Total Distributions 1.21 0.54 0.12
------------------------ ------------
Net Asset Value -
End of Period 13.36 12.08 10.30
======================== ============
TOTAL RETURN 20.93% 23.18%** 4.16%*
RATIOS
Net Assets - End of Period
($000 Omitted) 115,066 37,224 4,252
Ratio of Expenses to
Average Net Assets# 1.29%@ 1.25% 1.25%~
Ratio of Net Investment Income
to Average Net Assets# 3.03% 3.12% 2.87%~
Portfolio Turnover Rate 259% 255% 61%*
^ From December 1, 1993, commencement of operations, to July 31, 1994.
** Restated
* Based on operations for the period shown and, accordingly, are not
representative of a full year.
<PAGE>
# Various expenses of the Fund were voluntarily absorbed by IFG and ITC for the
years ended January 31, 1996 and 1995 and the period ended July 31, 1994. If
such expenses had not been voluntarily absorbed, ratio of expenses to average
net assets would have been 1.29%, 1.59% and 4.37% (annualized), respectively,
and ratio of net investment income to average net assets would have been 3.03%,
2.77% and (0.25%) (annualized), respectively.
@ Ratio is based on Total Expenses of the Fund, less Expenses Absorbed by
Investment Adviser, which is before any expense offset arrangements.
~ Annualized
<PAGE>
INVESCO Multiple Asset Funds, Inc.
Financial Highlights (Continued)
(For a Fund Share Outstanding Throughout Each Period)
Period
Ended
Year Ended July 31 July 31
------------------------ --------------
1996 1995 1994^
Multi-Asset Allocation Fund
PER SHARE DATA
Net Asset Value -
Beginning of Period $10.84 $9.68 $10.00
------------------------ --------------
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income 0.28 0.28 0.06
Net Gains or (Losses) on
Securities (Both Realized
and Unrealized) 0.89 1.16 (0.32)
------------------------ --------------
Total from Investment Operations 1.17 1.44 (0.26)
------------------------ --------------
LESS DISTRIBUTIONS
Dividends from Net Investment
Income 0.28 0.28 0.06
Distributions from Capital Gains 0.18 0.00 0.00
------------------------ --------------
Total Distributions 0.46 0.28 0.06
------------------------ --------------
Net Asset Value - End of Period 11.55 10.84 9.68
======================== ==============
TOTAL RETURN 10.96% 15.11%** (2.60%)*
RATIOS
Net Assets -End of Period
($000 Omitted) 9,574 7,778 4,958
Ratio of Expenses to
Average Net Assets# 1.62%@ 1.50% 1.50%~
Ratio of Net Investment Income
to Average Net Assets# 2.43% 2.99% 2.23%~
Portfolio Turnover Rate 92% 79% 42%*
^ From December 1, 1993, commencement of operations, to July 31, 1994.
** Restated
* Based on operations for the period shown and, accordingly, are not
representative of a full year.
# Various expenses of the Fund were voluntarily absorbed by IFG and IMR for the
years ended July 31, 1996 and 1995 and the period ended July 31, 1994. If such
expenses had not been voluntarily absorbed, ratio of expenses to average net
assets would have been 2.24%, 2.47% and 5.14% (annualized), respectively, and
<PAGE>
ratio of net investment income to average net assets would have been 1.81%,
2.02% and (1.41%) (annualized), respectively.
@ Ratio is based on Total Expenses of the Fund, less Expenses Absorbed by
Investment Adviser, which is before any expense offset arrangements.
~ Annualized
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Shareholders of
INVESCO Multiple Asset Funds, Inc.
In our opinion, the accompanying statement of assets and liabilities, including
the statement of investment securities, and the related statements of operations
and of changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of Balanced Fund and Multi-Asset
Allocation Fund (constituting INVESCO Multiple Asset Funds, Inc., hereafter
referred to as the "Fund") at July 31, 1996, the results of their operations for
the year then ended, the changes in their net assets for each of the two years
in the period then ended and the financial highlights for each of the periods
indicated, in conformity with generally accepted accounting principles. These
financial statements and financial highlights (hereafter referred to as
"financial statements") are the responsibility of the Fund's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included confirmation of securities at July
31, 1996 by correspondence with the custodian and the application of alternative
auditing procedures for unsettled security transactions, provide a reasonable
basis for the opinion expressed above.
Price Waterhouse LLP
/s/ Price Waterhouse
- --------------------
Denver, Colorado
August 30, 1996
<PAGE>
FAMILY OF FUNDS
Newspaper
Fund Name Fund Code Ticker Symbol Abbreviation
- --------------------------------------------------------------------------------
International
Latin American Growth 34 IVSLX LatinAmGr
European Small Company 37 IVECX EuroSmCo
European 56 FEURX Europ
Pacific Basin 54 FPBSX PcBas
International Growth 49 FSIGX IntlGr
Asian Growth 41 IVAGX AsianGr
- --------------------------------------------------------------------------------
Sector
Energy 50 FSTEX Enrgy
Environmental Services 59 FSEVX Envirn
Financial Services 57 FSFSX FinSvc
Gold 51 FGLDX Gold
Health Sciences 52 FHLSX HlthSc
Leisure 53 FLISX Leisur
Technology 55 FTCHX Tech
Worldwide Capital Goods 38 ISWGX WldCap
Worldwide Communications 39 ISWCX WldCom
- --------------------------------------------------------------------------------
Growth, Value
Emerging Growth 60 FIEGX Emgrth
Value Equity 46 FSEQX ValEq
Small Company 74 IDSCX DivSmCo
Dynamics 20 FIDYX Dynm
Growth 10 FLRFX Grwth
- --------------------------------------------------------------------------------
Equity-Income
Industrial Income 15 FIIIX IndInc
Utilities 58 FSTUX Util
- --------------------------------------------------------------------------------
Balanced/Multiple-Asset
Multi-Asset Allocation 70 IMAAX MulAstAl
Balanced 71 IMABX Bal
Total Return 48 FSFLX TotRtn
- --------------------------------------------------------------------------------
Bond
High Yield 31 FHYPX HiYld
Select Income 30 FBDSX SelInc
U.S. Government Securities 32 FBDGX USGvt
Intermediate Government Bond 47 FIGBX IntGov
Short-Term Bond 33 INIBX ShTrBd
- --------------------------------------------------------------------------------
Tax-Exempt
Tax-Free Long-Term Bond 35 FTIFX TxFre
Tax-Free Intermediate Bond 36 * *
- --------------------------------------------------------------------------------
Money Market
Tax-Free Money Fund 40 FFRXX N/A
Cash Reserves 25 FDSXX N/A
U.S. Government Money Fund 44 FUGXX N/A
* This fund does not meet size requirements to be assigned a ticker symbol in
newspaper listings.
For more information about any of the INVESCO Funds, including management fees
and expenses, please call us at 1-800-525-8085 for a prospectus. Read it
carefully before you invest or send money.
<PAGE>
INVESCO FUNDS
To receive general information and prospectuses
on any of INVESCO's funds or retirement plans,
or to obtain current account or price information,
call toll-free:
1-800-525-8085
To reach PAL, your 24-hour Personal
Account Line, call: 1-800-424-8085
You can find us on the World Wide Web:
http://www.invesco.com
Or write to:
INVESCO Funds Group, Inc., Distributor
Post Office Box 173706
Denver, Colorado 80217-3706
If you're in Denver, Please visit one of our
convenience Investor Centers:
Cherry Creek, 155-B Fillmore Street;
Denver Tech Center,
7800 East Union Avenue, Lobby Level
This information must be preceded or accompanied by an effective prospectus.
