<PAGE>
[LOGO]
MUTUAL FUNDS
A CLASS ABOVE
THESE FUNDS ARE NEITHER INSURED NOR GUARANTEED BY THE U.S. GOVERNMENT, THE FDIC,
THE FEDERAL RESERVE BOARD OR ANY OTHER GOVERNMENTAL AGENCY OR INSURER.
INVESTMENT ADVISER
Tempest, Isenhart, Chafee, Lansdowne &
Associates, Inc.
1380 Lawrence Street
Suite 1050
Denver, CO 80204
ADMINISTRATOR, DISTRIBUTOR, TRANSFER AGENT
& FUND ACCOUNTANT
ALPS Mutual Funds Services, Inc.
370 Seventeenth Street
Suite 3100
Denver, CO 80202
ANNUAL REPORT
LEGAL COUNSEL
Davis, Graham & Stubbs LLP April 30, 2000
370 Seventeenth Street
Suite 4700
Denver, CO 80202
INDEPENDENT AUDITORS
Deloitte & Touche LLP
555 Seventeenth Street
Suite 3600
Denver, Colorado 80202
CUSTODIAN
Fifth Third Bank, N.A.
Fifth Third Center
38 Fountain Square Plaza
Cincinnati, Ohio 45263
MUST BE ACCOMPANIED OR PRECEDED BY A CURRENT PROSPECTUS.
FOR MORE INFORMATION, PLEASE CALL 1-800-644-8595 OR VISIT www.aristata.com
[LOGO] [PHOTO]
Sponsor and Distributor
Member NASD
<PAGE>
LETTER FROM THE INVESTMENT ADVISER
================================================================================
Dear Fellow Shareholders:
We are very pleased to deliver the annual shareholder report for the Aristata
Funds. We are committed to making your investment in the Aristata Funds a
rewarding long-term experience.
HIGHLIGHTS OF INVESTMENT RESULTS
The differences in returns for the market in general or for the Aristata Equity
Fund in particular are explained by the dominance of growth vs. value investment
styles. The market results as depicted by the Standard & Poor's 500 Index were
generated by the stellar performance of the technology related sectors, the
pronounced investor preference for growth stocks, and a rise in prices that was
led by a relatively small number of companies. Last year, the dominance of
growth over value was characterized by an unprecedented performance spread.
The performance comparison table that accompanies the Aristata Equity Fund
incorporates the new Lipper category--Multi-Cap Value Funds. Lipper now assigns
funds to categories based upon actual portfolio holdings compared to strictly a
prospectus description of investment objective and style. The new category for
the Aristata Equity Fund is Lipper Multi-Cap Value Funds.
The performance of the Aristata Equity Fund compares favorably with the Lipper
Multi-Cap Value Fund Index. The recent market action--increased price
volatility--may be signaling a shift in stock performance that will benefit
value investing.
Stock market volatility has prompted a flight to quality and the bond market has
been the beneficiary. Most sectors of the bond market provided positive,
although modest, total returns and those returns were achieved with considerably
less fluctuations than encountered with stocks. Countervailing forces are at
work in the bond market. First, the interest rate declines for some bonds (and
increases in bond prices) were due to good old fashioned supply and demand
factors: government surpluses are now being used to buy bonds rather than
issuing more, and investors are buying bonds for stability. Second, short-term
interest rate increases (and decreases in bond prices) were a direct action of
the Federal Reserve Bank (FED) and Chairman Greenspan to slow the economy, and
perhaps cool stock market speculation. Even with these crosscurrents, the bond
market was a haven of stability compared to the volatility experienced by some
stock market sectors. Mr. Greenspan views the economy's growth as still too
rapid, and additional interest rate increases seem likely but the timing and
magnitude remain uncertain.
============================================================================ 1
<PAGE>
LETTER FROM THE INVESTMENT ADVISER
================================================================================
<TABLE>
<CAPTION>
TOTAL RETURNS ENDING APRIL 30, 2000 (1) AVERAGE ANNUAL
3 MONTHS 6 MONTHS 12 MONTHS SINCE INCEPTION
-------- -------- --------- ---------------
<S> <C> <C> <C> <C>
ARISTATA EQUITY FUND 6.25% 7.27% 2.23% 7.48%
Standard & Poor's 500 Index* 4.47 7.21 10.08 17.72
Value Line Composite Index 2.79 6.55 0.01 -2.25
Lipper Multi-Cap Value Index 4.55 2.28 -3.37 2.67
ARISTATA QUALITY BOND FUND 1.37% 0.37% 0.28% 2.96%
Lehman Brothers Government/Corp Bond Index* 2.20 1.49 0.93 3.67
Lehman Brothers Government/Corp Intermediate Bond Index 1.63 1.05 1.52 4.00
Lipper Corporate Debt Funds A Rated Index 1.59 0.98 -0.28 2.50
ARISTATA COLORADO QUALITY TAX-EXEMPT FUND 1.57% 1.60% 0.16% 2.64%
Lehman Brothers Municipal Bond Index* 2.77 2.63 -0.92 2.54
Lipper Municipal Intermediate Bond Fund Index 1.78 1.73 -0.89 2.11
Lipper Colorado Municipal Bond Fund Average 2.87 1.82 -3.20 0.87
</TABLE>
*Fund benchmark index
THE TOTAL RETURN FIGURES REPRESENT PAST PERFORMANCE AND ARE NOT INDICATIVE OF
FUTURE RESULTS.
(1) SEE FOOTNOTES ON P. 13
THE DR. JEKYLL AND MR. HYDE MARKET
The current assessment of the financial markets can be summarized as a Dr.
Jekyll and Mr. Hyde environment. Like the kind and friendly doctor Henry Jekyll,
the closing months of the April 30, 2000 fiscal year saw some of the best news
reported for the financial markets, the economy, and for consumers. The friendly
and cheery Dr. Jekyll aptly describes the mood of investors for most of the past
year. Strong economic growth, robust profits, plentiful jobs, and low inflation
boosted consumer confidence to record levels. This friendly mood set the stage
for the Dow Jones Industrials to make new highs (11,722) in January, and for the
NASDAQ to cross 5,000 for the first time in March.
========================
The results are
financial markets that
are behaving like the
personalities inside
Jekyll and Hyde.
========================
Robert Louis Stevenson provided an intriguing study in the dual nature of human
personality. The recent stock market gyrations reflect the tug of war going on
between the bullish and bearish views of investors. Lurking behind the good news
surrounding the economy and the optimism characterizing most investors is a
darker side lurking beneath the markets' surface. The reckless and malevolent
Mr. Hyde personality seems to manifest in today's market volatility.
Unlike earlier in the year, during the past few months, the stock market has
experienced dramatic price volatility reflecting wide investor mood swings. The
following chart shows that the frequency of daily price swings of 1% or greater
is on the rise for the Standard & Poor's 500.
2 ============================================================================
<PAGE>
LETTER FROM THE INVESTMENT ADVISER
================================================================================
[GRAPH]
Fluctuations are even more dramatic on the NASDAQ where speculative activity is
more concentrated. The NASDAQ collapsed 575 points or 13.6% intraday on April 5,
before rebounding sharply to close the day down 75 points or 1.8%. So far this
year, about 70% of the trading days saw changes of more than 1% for the day.
A 10% move (from a high point to a low point in a market index) is considered a
market correction. In just the past three months there already have been two
such downward moves and one recovery of 10% or more in the NASDAQ! These kinds
of market cycles used to take years, not months or weeks!
What are the causes and implications for the rise in stock market volatility?
Record high valuations, instant news, speculative initial public offerings
(IPO's), online trading, and momentum investing all have contributed to
increased volatility. Dramatic price swings now seem to be a daily fact of life
in the stock market. Like the cold, frontal winds that sweep in to precede a
change in the weather, market volatility often indicates a change for the stock
market.
While the daily volatility is disconcerting, it offers a positive note. A key
feature of the recent stock market is the decisive change in leadership that is
increasingly taking place. Rotation away from previously hot sectors into
neglected areas of the market (everything other than tech and dot.com) has been
dramatic during the volatile days. The "new paradigm crowd" is beginning to have
some real doubts about valuations and even survivability of many dot.com
startups.
============================================================================ 3
<PAGE>
LETTER FROM THE INVESTMENT ADVISER
================================================================================
There is increasing recognition that the valuation disparity between tech stocks
(read "new economy") and non-tech stocks (read "old economy") cannot be ignored.
The valuations are extremely stretched for many NASDAQ companies. The fortunes
of tech and non-tech stock groups are not mutually exclusive. It seems that the
tech companies only remain robust if the non-tech companies (who purchase and
utilize the new technology) also remain robust. Stated another way, the
tremendous productivity and efficiency promised by new technology must accrue to
someone, and that "someone" is most often old economy companies that have been
ignored in recent markets. Today, valuations seem stretched. Many tech companies
are selling for 70 to 100 times earnings, for those companies with earnings!
Whereas, many non-tech, old economy companies are priced for less then 20 times
earnings. Benjamin Graham, the father of security analysis said it best: "...but
the important thing for us to bear in mind as practicing analysts is that, when
you pay full value for common stocks, you are in great danger of later appearing
to have paid too much."
Valuation is an important discipline of our investment approach, and the recent
rotation suggests that valuation--the price paid for stocks--does matter after
all. Evidently many investors are now starting to question the valuation levels
of many high-tech stocks. Jeremy Siegel, professor of finance at the Wharton
School and author of "Stocks for the Long Run" wrote in The Wall Street Journal
recently; "But are the high valuations of the tech stocks that drive the NASDAQ
index justified? History suggests not. Even if the fantastic long-term growth
rates for ...the tech companies come true, they won't be nearly good enough to
sustain current [prices]."
Historically, an important constant for investors and for the market is the
close relationship of valuation and long-term stock market returns. As the
following table illustrates, buying companies at reasonable prices (low
price-to-earnings ratios--P/E) has been a successful strategy over time.
[GRAPH]
4 ============================================================================
<PAGE>
LETTER FROM THE INVESTMENT ADVISER
================================================================================
In recent years, just the reverse has held true. The higher a company's P/E
ratio, the stronger the performance. The wheels of the technology wagon are
wobbling more and more. All of a sudden there is awareness that valuation does
matter and that even "growth" does have a price beyond which it is unreasonable.
There is, however, a silver lining to all of this -- there are great values
within this extremely bifurcated market. And the best news is that the current
volatile markets are finally pointing to recognition of those opportunities. Our
preference for buying companies at reasonable prices in relation to their
earnings; i.e., low PE ratios, should have the added advantage of less risk and
lower volatility.
These are uncertain times for interest rates. Our bond fund investments include
diversified holdings of high quality issues and intermediate maturities. Based
upon the current interest rate levels, the portfolios are capturing attractive
current income, while maintaining intermediate maturities that are less
sensitive to the vagaries of a changing interest rate environment.
On behalf of all the members of our organization, we appreciate your
participation in the Aristata Funds. As investors with you in these Funds, our
firm is dedicated to providing you with successful, long-term investment
results.
Sincerely,
/s/ H. David Lansdowne
H. David Lansdowne, CFA
President
Tempest, Isenhart, Chafee, Lansdowne & Associates, Inc.
============================================================================ 5
<PAGE>
FUND REVIEW
================================================================================
ARISTATA EQUITY FUND
PERFORMANCE
For the periods ended April 30, 2000, the Aristata Equity Fund returned 6.25%,
7.27%, and 2.23% for the latest 3 months, six months, and twelve months. The
Fund results for the last three months were, as one would expect, quite strong
in what was a turbulent market. The major stock market averages experienced wide
price swings during the year ended April 30, 2000. As the following table
indicates, from the record high prices reached earlier, stock prices moved lower
by April 30th.
<TABLE>
<CAPTION>
SUBSEQUENT CLOSING
STOCK MARKET INDEX DATE AND HIGH PRICE LOW PRICE % DECLINE APRIL 30TH CLOSE
----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Dow Jones Industrial Jan 14 11,722 9,796 -16.5% 10,733
Standard & Poor's 500 March 24 1,527 1,356 -11.1% 1,452
NASDAQ Composite March 10 5,049 3,321 -34.2% 3,860
----------------------------------------------------------------------------------------------
</TABLE>
The price declines qualify as a "correction" (a decline of 10% or more) for two
of the averages, and the NASDAQ decline crossed the "bear market" threshold (a
decline of 20% or more). The NASDAQ decline is striking by not only the size of
the correction, but also by how quickly it occurred from the record high reached
in March.
ARISTATA EQUITY FUND
SECTOR PROFILE
as of April 30, 2000
[GRAPH]
The Aristata Equity Fund, while not immune to these market conditions, recorded
a strong showing during the general decline in stock prices. The Fund's
diversified industry holdings helped to insulate the portfolio's investments
during recent market corrections. Much of the stock market decline was
concentrated in technology and internet related issues. The Fund's
characteristic average lower price-to-earnings ratio (PE) is an important
attribute that contributed to recent positive results. There are signs
developing that the stock market leadership may be moving toward lower PE
stocks.
6 ============================================================================
<PAGE>
FUND REVIEW
================================================================================
ARISTATA EQUITY FUND (CON'T.)
The twelve month returns for the Aristata Equity Fund compare quite favorably
with the Lipper peer group category of Multi-Cap Value. The market factors
affecting our Aristata stock performance last year included the adherence to our
value disciplines. The Lipper comparison illustrates that the value style held
investment returns in check compared to the growth/technology influenced
Standard & Poor's 500. The Aristata Equity Fund results were hurt for the twelve
months by our ability to find only a limited number of technology companies that
meet our valuation criteria. However, as the recent returns indicate, our value
discipline has garnered improved results as many of the richly valued technology
stocks declined in price recently.
EQUITY MARKET OVERVIEW
The equity market benefited from a positive backdrop of continued economic
growth, low inflation, strong profits, and upbeat consumer confidence. These
factors combined to create an almost ideal environment for the U.S. stock
market. The trend of stock prices biased upward for most of the
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN THE ARISTATA EQUITY FUND,
THE S&P 500 AND THE VALUE LINE COMPOSITE.
[GRAPH]
<TABLE>
<CAPTION>
PERFORMANCE
AS OF APRIL 30, 2000
-----------------------------
AVERAGE ANNUAL TOTAL RETURN (1)
<S> <C>
1 Year 2.23%
Since Inception 7.48%
</TABLE>
<TABLE>
<CAPTION>
---------------------------------------------------
FUND VALUE VS. INDEX VALUE
AT APRIL 30, 2000
---------------------------------------------------
<S> <C>
Aristata Equity Fund $11,689
---------------------------------------------------
S&P 500 $13,290
---------------------------------------------------
Value Line Composite $9,444
---------------------------------------------------
</TABLE>
THE TOTAL RETURN FIGURES REPRESENT PAST PERFORMANCE AND ARE NOT INDICATIVE OF
FUTURE RESULTS.
============================================================================ 7
<PAGE>
FUND REVIEW
================================================================================
ARISTATA EQUITY FUND (CON'T.)
year, but at times price swings became quite extreme. The rising tide of a
strong economy and good profits did not increase all stock prices equally. In
fact, stock market returns were extremely bifurcated, and as the year wore on
fewer and fewer stocks were advancing. Technology and internet related stocks
were strong performers early, but valuations were pushed to record breaking
levels. Then in March and April there were dramatic corrections in many of the
technology stocks, with a rotation into so-called "Old-Economy" stocks, where
many stock prices offered compelling valuations.
The popular stock market averages closed April 30th down from their earlier year
highs. These declines seem to reflect the growing concern by investors that the
Federal Reserve Bank will institute additional interest rate hikes. For now,
investor moods have become more cautious.
PORTFOLIO UPDATE
The Aristata Equity Fund is a diversified, value oriented investment portfolio.
The portfolio's investments are spread across approximately 20 different
industries, and individual company investments have attractive, low price to
earnings (PE) characteristics.
The ten largest holdings represent approximately 30.3% of the total portfolio.
These 10 companies share the same attractive valuations that are a hallmark of
the Aristata Equity Fund. These companies have an average PE of 21.0x and offer
an above average dividend yield of 2.1% The Standard & Poor's 500 sells at a PE
of 24x and yields a near record low of 1.1%.
<TABLE>
<CAPTION>
TEN LARGEST EQUITY HOLDINGS(3)
AS OF APRIL 30, 2000
% OF DIVIDEND PRICE
PORTFOLIO YIELD EARNINGS RATIO
<S> <C> <C> <C>
International Business Machines Corp. 3.7% 0.5% 21.9 x
AMGEN, Inc. 3.4% 0.0% 49.0
Texaco, Inc. 3.3% 3.2% 16.0
BP Amoco PLC 3.1% 2.2% 19.8
Bellsouth Corp. 3.0% 1.6% 19.7
Vulcan Materials, Co. 2.9% 1.8% 14.0
GTE Corp 2.8% 2.8% 15.7
Hewlett-Packard Co. 2.8% 0.5% 34.1
Duke-Weeks Realty Corp. 2.7% 7.1% 8.3
Ingersoll Rand Co. 2.6% 1.3% 11.4
TEN LARGEST HOLDINGS 30.3% 2.1% AVG. 21.0 X AVG.
</TABLE>
8 ============================================================================
<PAGE>
FUND REVIEW
================================================================================
ARISTATA EQUITY FUND (CON'T.)
Last year our approximate 13.2% investment in oil, natural gas and energy
service companies was a positive contributor to performance. This sector remains
one of the largest investments for the portfolio, and the outlook remains
positive. Another important investment is the drug and healthcare area, where an
aging population and attractive new product flow should bode well for future
growth.
Technology is an area where we continue to seek attractive opportunities. We are
adhering to our valuation disciplines, and continue to make purchases in
profitable companies that will likely continue to be industry leaders.
ARISTATA QUALITY BOND FUND AND ARISTATA COLORADO QUALITY TAX-EXEMPT FUND
ARISTATA QUALITY BOND FUND
QUALITY PROFILE (2)
as of April 30, 2000
[GRAPH]
PERFORMANCE
The Aristata Quality Bond Fund's total return for the fiscal year ending April
30, 2000 was .28%. The Lehman Brothers Government/Corporate Bond Index and the
Lehman Brothers Government/Corporate Intermediate Bond Index registered
comparable returns of .93% and 1.52% respectively. As of April 30th, net assets
of the Aristata Quality Bond Fund were $42.4 million. The Aristata Colorado
Quality Tax-Exempt Fund had net assets of $13.8 million for the same ending
period, while its 12 month total return was .16%. Comparable returns for the
Lipper Municipal Intermediate Bond Fund Index and the Lehman Brothers Municipal
Bond Index were -.89% and -.92%, respectively.
============================================================================ 9
<PAGE>
FUND REVIEW
================================================================================
ARISTATA QUALITY BOND FUND AND ARISTATA COLORADO QUALITY TAX-EXEMPT FUND
(CON'T.)
FIXED INCOME MARKET REVIEW
The fixed income markets experienced a challenging year. Dramatic swings in the
stock market have led to volatility in the bond market as well. Several factors
have caused this volatility, including a marked decline in technology stocks,
the Federal Reserve's tightening monetary policy, and hints of a pick-up in
inflation.
The economy continues to grow at an accelerated pace. This economic expansion,
in its 10th consecutive year of positive growth, has lasted this long, in part,
due to inflation staying low. However most recently, inflation reports have
shown a trend in rising oil prices and labor costs, and surging retail sales.
The Federal Reserve has raised short-term interest rates five times since last
June, in an effort to balance the economy. The Federal Reserve appears to not be
finished with its tightening policy. Looking ahead, the Federal Reserve must
evaluate whether the decline in the equity markets is likely to dampen future
consumer spending.
PORTFOLIO UPDATE
ARISTATA QUALITY BOND FUND
During the period under review, despite the volatility, several sectors of the
bond market offered opportunities. Strong tax receipts and budget surpluses have
lessened the need for the Treasury to issue debt. As a result, the U.S.
government's debt buyback program has led to investors anticipating a limited
supply of long-term treasuries. In addition, treasuries benefited from a
flight-to-quality from weakness in technology issues. Other sectors such as
corporates and agencies provided exceptional values during the period, as their
yield spreads continued to widen.
ARISTATA QUALITY BOND FUND
SECTOR PROFILE
as of April 30, 2000
[GRAPH]
The Aristata Quality Bond Fund holds 55% in high-grade corporate bonds and 39%
in U.S. Government and agency obligations. The Fund's average maturity on April
30th was 6.4 years.
10 ============================================================================
<PAGE>
FUND REVIEW
================================================================================
ARISTATA QUALITY BOND FUND AND ARISTATA COLORADO QUALITY TAX-EXEMPT FUND
(CON'T.)
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN THE ARISTATA QUALITY BOND
FUND, THE LEHMAN BROTHERS GOVERNMENT/CORPORATE BOND INDEX AND THE LEHMAN
BROTHERS GOVERNMENT/CORPORATE INTERMEDIATE BOND INDEX.
[GRAPH]
<TABLE>
<CAPTION>
PERFORMANCE
AS OF APRIL 30, 2000
-------------------------------
AVERAGE ANNUAL TOTAL RETURN (1)
<S> <C>
1 Year 0.28%
Since Inception 2.96%
</TABLE>
<TABLE>
<CAPTION>
FUND VALUE VS. INDEX VALUE
AT APRIL 30, 2000
--------------------------------------------------------
<S> <C>
Aristata Quality Bond Fund $10,651
--------------------------------------------------------
Lehman Bros. Gov't/Corp. Bond Index $10,655
--------------------------------------------------------
Lehman Bros. Gov't/Corp. Interm. Bond Index $10,779
--------------------------------------------------------
</TABLE>
THE TOTAL RETURN FIGURES REPRESENT PAST PERFORMANCE AND ARE NOT INDICATIVE OF
FUTURE RESULTS.
PORTFOLIO UPDATE
ARISTATA COLORADO QUALITY TAX-EXEMPT FUND
The tax-exempt market has exhibited lower relative volatility than its taxable
counterparts. However, Colorado municipals have also provided exceptional
values, as their yield levels are approximately 100 basis points(1%) higher than
levels a year ago.
============================================================================ 11
<PAGE>
FUND REVIEW
ARISTATA QUALITY BOND FUND AND ARISTATA COLORADO QUALITY TAX-EXEMPT FUND
(CON'T.)
As municipal prices have risen less than Treasury bond prices, the ratio of
municipal yields to Treasury yields has increased. Long-term municipal yields
are now almost on parity with long-term taxable yields.
Municipal credit quality continues to improve and most state and local
municipalities are now in a position of budget surplus. The volume of municipal
issuance in the 1st quarter of 2000 is down 40% from the same period a year ago.
As new supply becomes available, the Fund will continue to emphasize high
quality Colorado municipal bonds, while providing tax-free income to our
shareholders.
ARISTATA COLORADO QUALITY TAX-EXEMPT FUND
SECTOR PROFILE
as of April 30, 2000
[GRAPH]
ARISTATA COLORADO QUALITY TAX-EXEMPT FUND
QUALITY PROFILE (2)
as of April 30, 2000
[GRAPH]
12 ============================================================================
<PAGE>
FUND REVIEW
================================================================================
ARISTATA QUALITY BOND FUND AND ARISTATA COLORADO QUALITY TAX-EXEMPT FUND
(CON'T.)
Comparison of Change in Value of $10,000 Investment in the Aristata Colorado
Quality Tax-Exempt Fund, the Lipper Municipal Intermediate Bond Fund Index, and
the Lehman Brothers Municipal Bond Index.
[GRAPH]
<TABLE>
<CAPTION>
PERFORMANCE
AS OF APRIL 30, 2000
-------------------------------
AVERAGE ANNUAL TOTAL RETURN (1)
<S> <C>
1 Year 0.16%
Since Inception 2.64%
</TABLE>
<TABLE>
<CAPTION>
FUND VALUE VS. INDEX VALUE
AT APRIL 30, 2000
<S> <C>
Aristata Colorado Quality Tax-Exempt Fund $10,581
Lehman Brothers Municipal Bond Index $10,559
Lipper Municipal Interm. Bond Fund Index $10,464
</TABLE>
THE TOTAL RETURN FIGURES REPRESENT PAST PERFORMANCE AND ARE NOT INDICATIVE OF
FUTURE RESULTS.
(1) TOTAL RETURN IS THE CHANGE IN THE VALUE OF AN INVESTMENT IN THE FUND AFTER
REINVESTING ALL INCOME AND CAPITAL GAINS. IT IS CALCULATED BY DIVIDING THE
CHANGE IN TOTAL INVESTMENT VALUE BY THE INITIAL VALUE OF THE INVESTMENT. TOTAL
RETURN FIGURES ARE NET OF ALL FUND EXPENSES AND REFLECT ALL FEE WAIVERS. WITHOUT
THESE FEE WAIVERS, TOTAL RETURN WOULD HAVE BEEN LOWER. THE INCEPTION DATE OF
EACH FUND IS MARCH 2, 1998. THE INVESTMENT RETURN AND PRINCIPAL VALUE OF AN
INVESTMENT WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE
WORTH MORE OR LESS THAN THEIR ORIGINAL COST. THE TOTAL RETURN FIGURES REPRESENT
PAST PERFORMANCE AND ARE NOT INDICATIVE OF FUTURE RESULTS.
(2) QUALITY PROFILE BASED ON EACH SECURITY'S RATING FROM MOODY'S. FOR THOSE
RATINGS NOT AVAILABLE FROM MOODY'S, S&P RATINGS WERE USED.
(3) THE TEN LARGEST EQUITY HOLDINGS ARE PRESENTED TO ILLUSTRATE EXAMPLES OF THE
EQUITY SECURITIES THAT THE FUND HAS BOUGHT AND MAY NOT BE REPRESENTATIVE OF THE
FUND'S CURRENT OR FUTURE INVESTMENTS.
THE VIEWS EXPRESSED IN THIS ADVISER UPDATE REFLECT THE ADVISER'S VIEW ONLY
THROUGH APRIL 30, 2000. THE ADVISER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME
BASED ON MARKET AND OTHER CONDITIONS.
============================================================================ 13
<PAGE>
FUND REVIEW
================================================================================
DEFINITION OF INDICES
The LEHMAN BROTHERS GOVERNMENT/CORPORATE BOND INDEX and the LEHMAN BROTHERS
GOVERNMENT/ CORPORATE INTERMEDIATE BOND INDEX are unmanaged indices that are a
broad measure of bond performance that reflect the reinvestment of income
dividends and capital gain distributions, if any, but do not reflect fees,
brokerage commissions, or other expenses of investing. Intermediate indices
include bonds with maturities of up to ten years.
The LEHMAN BROTHERS MUNICIPAL BOND INDEX is an unmanaged index that is a broad
measure of tax-exempt bond performance that reflects the reinvestment of income
dividends and capital gain distributions, if any, but does not reflect fees,
brokerage commissions, or other expenses of investing.
The LIPPER COLORADO MUNICIPAL BOND FUND AVERAGE is an unmanaged index that
measures the performance of bond funds which are exempt from taxation of the
state of Colorado. The index return reflects the reinvestment of income
dividends and capital gain distributions, if any.
The LIPPER CORPORATE DEBT FUNDS A RATED INDEX is an unmanaged index that
measures the performance of funds that invest at least 65% of their assets in
corporate debt issues rated "A" or better or government issues.
The LIPPER MULTI-CAP VALUE FUND INDEX is an unmanaged index of funds, that by
portfolio practice, invest in a variety of market capitalization ranges, without
concentrating 75% of their equity assets in any one market capitalization range
over an extended period of time. Multi-Cap Value funds seek long-term growth of
capital by investing in companies that are considered to be undervalued relative
to a major unmanaged stock index based on price-to-current earnings, book value,
asset value, or other factors. These funds will normally have a below-average
price-to-earnings ratio, price-to-book ratio, and three-year earnings growth
figure, compared to the U.S. diversified multi-cap funds universe average.
The LIPPER MUNICIPAL INTERMEDIATE BOND FUND INDEX is an unmanaged index that
measures the performance of intermediate municipal debt funds (i.e. those with
dollar-weighted average maturities of 5 to 10 years). The index return reflects
the reinvestment of income dividends and capital gain distributions, if any.
The STANDARD & POOR'S 500 INDEX (S&P 500) is an unmanaged index containing
common stocks of 500 industrial, transportation, utility and financial
companies, regarded as generally representative of the U.S. stock market. The
index return reflects the reinvestment of income dividends and capital gain
distributions, if any, but does not reflect fees, brokerage commissions, or
other expenses of investing.
The VALUE LINE COMPOSITE INDEX is an unmanaged equally weighted geometric
average composed of approximately 1700 stocks traded on the New York Stock
Exchange, American Stock Exchange, and over- the-counter that are tracked by the
Value Line Investment Survey. The index return reflects the reinvestment of
income dividends and capital gain distributions, if any, but does not reflect
fees, brokerage commissions, or other expenses of investing.
14 ============================================================================
<PAGE>
INDEPENDENT AUDITORS' REPORT
================================================================================
DELOITTE &
TOUCHE LLP
----------
[LOGO]
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS,
FINANCIAL INVESTORS TRUST:
We have audited the accompanying statements of assets and liabilities, including
the statements of investments, of the Aristata Equity Fund, Aristata Quality
Bond Fund and Aristata Colorado Quality Tax-Exempt Fund of Financial Investors
Trust as of April 30, 2000, the related statements of operations for the year
then ended and the statements of changes in net assets and financial highlights
for each of the periods indicated. These financial statements and financial
highlights are the responsibility of the Trust's management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining on a test basis, evidence supporting the amounts and
disclosures in the financial statements and financial highlights. Our procedures
included confirmation of securities owned at April 30, 2000, by correspondence
with the custodian and brokers; where replies were not received from brokers, we
performed other auditing procedures. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, such financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
Aristata Equity Fund, Aristata Quality Bond Fund and Aristata Colorado Quality
Tax-Exempt Fund of Financial Investors Trust as of April 30, 2000, and the
results of their operations for the year then ended, the changes in their net
assets and financial highlights for each of the periods indicated in conformity
with accounting principles generally accepted in the United States of America.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Denver, Colorado
June 7, 2000
---------------
DELOITTE TOUCHE
TOHMATSU
INTERNATIONAL
---------------
============================================================================ 15
<PAGE>
ARISTATA EQUITY FUND
================================================================================
ARISTATA EQUITY FUND
STATEMENT OF INVESTMENTS
APRIL 30, 2000
<TABLE>
<CAPTION>
SHARES VALUE*
<S> <C> <C>
COMMON STOCKS - 95.38%
BASIC MATERIALS - 0.87%
CHEMICALS - 0.87%
Hanna (M. A.) Co. 55,000 $ 632,500
--------------
TOTAL BASIC MATERIALS 632,500
--------------
BUILDING/REAL ESTATE - 7.92%
BUILDING MATERIALS - 3.74%
Lafarge Corp. 25,000 631,250
Vulcan Materials, Co. 48,000 2,103,000
--------------
2,734,250
--------------
R.E.I.T./Real Estate - 4.18%
Archstone Community Trust 51,000 1,102,875
Duke-Weeks Realty Corp. 90,000 1,951,875
--------------
3,054,750
--------------
TOTAL BUILDING/REAL ESTATE 5,789,000
--------------
CONSUMER DURABLES - 4.75%
AUTOMOTIVE - 1.49%
Delphi Automotive Systems Corp. 57,000 1,090,125
--------------
HOUSEHOLD GOODS - 3.26%
Eastman Kodak Co. 23,500 1,314,531
Leggett & Platt, Inc. 50,000 1,068,750
--------------
2,383,281
--------------
TOTAL CONSUMER DURABLES 3,473,406
--------------
CONSUMER STAPLES - 5.63%
FOOD/BEVERAGE - 0.96%
Earthgrains Co. 50,000 703,125
--------------
PACKAGED GOODS - 1.70%
Avon Products, Inc. 30,000 1,245,000
--------------
RETAIL - 2.97%
Circuit City Store, Inc. 10,000 $ 588,125
May Department Stores Co. 15,000 412,500
Office Depot, Inc.** 35,000 369,687
Target Corp. 12,000 798,750
--------------
2,169,062
--------------
TOTAL CONSUMER STAPLES 4,117,187
--------------
ELECTRIC & GAS UTILITIES - 7.34%
ELECTRIC UTILITIES - 3.52%
Duke Energy Corp. 22,000 1,265,000
New Century Energies, Inc. 40,000 1,305,000
--------------
2,570,000
--------------
GAS UTILITIES - 3.82%
Northwest Natural Gas Co. 50,000 1,100,000
Questar Corp. 90,000 1,693,125
--------------
2,793,125
--------------
TOTAL ELECTRIC & GAS UTILIITES 5,363,125
--------------
ENERGY - 13.16%
OIL FIELD SERVICES - 4.53%
Baker Hughes, Inc. 49,000 1,558,812
Halliburton Co. 30,000 1,325,625
Transocean Sedco Forex, Inc. 9,000 423,000
--------------
3,307,437
--------------
OIL & GAS - 8.63%
BP Amoco PLC** 44,280 2,258,280
Royal Dutch Petroleum Co. 19,200 1,101,600
Texaco, Inc. 49,200 2,435,400
Tosco Corp.** 16,000 513,000
--------------
6,308,280
--------------
TOTAL ENERGY 9,615,717
--------------
FINANCIAL - 6.93%
BANKS/S & L/FINANCE/LEASE - 3.51%
First Union Corp. 14,000 446,250
Morgan J. P. & Co., Inc. 8,000 1,027,000
PNC Bank Corp. 25,000 1,090,625
--------------
2,563,875
--------------
</TABLE>
16 ============================================================================
<PAGE>
ARISTATA FUNDS
================================================================================
ARISTATA EQUITY FUND
STATEMENT OF INVESTMENTS
APRIL 30, 2000 (CONTINUED)
<TABLE>
<CAPTION>
SHARES VALUE*
<S> <C> <C>
BROKERS/FINANCIAL SERVICES - 2.77%
Gallagher Arthur J & Co. 12,000 $ 447,000
Marsh & McLennan Cos., Inc. 16,000 1,577,000
--------------
2,024,000
--------------
INSURANCE - 0.65%
Allstate Corp. 20,020 472,973
--------------
TOTAL FINANCIAL 5,060,848
--------------
HEALTHCARE - 12.81%
DRUGS - 6.63%
Abbott Laboratories 18,000 691,875
American Home Products Corp. 30,000 1,685,625
AMGEN, Inc.** 44,000 2,464,000
--------------
4,841,500
--------------
HEALTHCARE SERVICES - 2.01%
United Healthcare Corp.22,000 1,467,125
--------------
MEDICAL PRODUCTS - 4.17%
Bausch & Lomb, Inc. 20,000 1,207,500
Cardinal Health, Inc. 12,000 660,750
Pall Corp. 53,000 1,182,562
--------------
3,050,812
--------------
TOTAL HEALTHCARE 9,359,437
--------------
INDUSTRIAL PRODUCTS & SERVICES - 14.46%
AEROSPACE - 1.94%
AAR Corp. 47,000 707,937
Northrop Grumman Corp.** 10,000 708,750
--------------
1,416,687
--------------
BUSINESS INFORMATION - 2.51%
Robert Half International, Inc.** 30,000 1,833,750
--------------
ELECTRICAL PRODUCTS - 5.04%
Anixter International, Inc.** 21,000 707,438
Emerson Electric Co. 23,000 1,262,125
Molex, Inc. 31,250 1,716,797
--------------
3,686,360
--------------
SHARES VALUE*
INDUSTRIAL COMPONENTS - 4.97%
Hussmann International, Inc. 50,000 $ 693,750
Ingersoll Rand Co. 40,000 1,877,500
Kennametal, Inc. 37,000 1,063,750
--------------
3,635,000
--------------
TOTAL INDUSTRIAL PRODUCTS
& SERVICES 10,571,797
--------------
TECHNOLOGY - 15.09%
COMPUTERS/PERIPHERAL - 8.18%
Hewlett-Packard Co. 15,000 2,025,000
International Business
Machines Corp. 24,000 2,679,000
Seagate Technology, Inc.** 25,000 1,270,313
--------------
5,974,313
--------------
ELECTRONICS - 3.56%
Avnet, Inc. 7,000 550,375
Lucent Technologies, Inc. 10,000 621,875
Motorola, Inc. 12,000 1,428,750
--------------
2,601,000
--------------
SOFTWARE - 3.35%
Electronic Data Systems Corp. 25,000 1,718,750
JD Edwards & Co.** 40,000 730,000
--------------
2,448,750
--------------
TOTAL TECHNOLOGY 11,024,063
--------------
TELECOMMUNICATIONS - 6.42%
COMMUNICATIONS - 6.42%
AT&T Corp. 10,000 466,875
BellSouth Corp. 45,000 2,190,938
GTE Corp. 30,000 2,032,500
--------------
4,690,313
--------------
TOTAL TELECOMMUNICATIONS 4,690,313
--------------
TOTAL COMMON STOCKS 69,697,393
(Cost $39,702,392) --------------
</TABLE>
============================================================================= 17
<PAGE>
ARISTATA FUNDS
================================================================================
ARISTATA EQUITY FUND
STATEMENT OF INVESTMENTS
APRIL 30, 2000 (CONTINUED)
<TABLE>
<CAPTION>
SHARES VALUE*
<S> <C> <C>
CLOSED-END FUNDS - 3.37%
FOREIGN - 3.37%
Asia Tigers Fund 135,000 $ 1,189,688
Morgan Stanley Asia-Pacific
Fund 120,000 1,275,000
--------------
TOTAL CLOSED-END FUNDS 2,464,688
(Cost $1,994,993) --------------
SHORT-TERM INVESTMENTS - 1.23%
MUTUAL FUNDS - 1.23%
Fifth Third C/P Fund 899,693 899,693
--------------
TOTAL SHORT-TERM INVESTMENTS 899,693
(Cost $899,693) --------------
TOTAL INVESTMENTS 99.98% 73,061,774
(Cost $42,597,078)
Other Assets in Excess
of Liabilities 0.02% 13,991
------------------------
NET ASSETS 100.00% $73,075,765
========================
* See note 1 to financial statements.
**Denotes non-income producing security.
ARISTATA QUALITY BOND FUND
STATEMENT OF INVESTMENTS
APRIL 30, 2000
<CAPTION>
Due Bond Rating** Principal
Date Coupon Moody's Amount Value*
---- ------ ------------- --------- ------
<S> <C> <C> <C> <C>
U.S. GOVERNMENT &
AGENCY OBLIGATIONS - 39.10%
U.S. TREASURY NOTES - 5.50%
08/15/05 6.500% Aaa $ 900,000 $ 898,594
07/15/06 7.000% Aaa 1,400,000 1,432,813
--------------
2,331,407
--------------
U.S. TREASURY BONDS - 7.75%
02/15/07 7.625% Aaa 1,367,000 1,385,796
11/15/07 7.875% Aaa 920,000 943,288
05/15/10 10.000% Aaa 840,000 956,288
--------------
3,285,372
--------------
FEDERAL FARM CREDIT BANK - 1.09%
01/22/08 6.120% Aaa 500,000 460,611
--------------
FEDERAL HOME LOAN BANK - 11.05%
07/27/07 7.000% Aaa 800,000 767,758
11/14/07 7.000% Aaa 300,000 287,408
08/19/09 7.050% Aaa 250,000 239,346
01/12/10 7.155% Aaa 250,000 240,755
10/29/13 6.150% Aaa 250,000 217,139
02/25/14 6.540% Aaa 250,000 222,877
03/10/14 6.730% Aaa 250,000 225,705
08/25/14 8.010% Aaa 250,000 241,553
09/23/14 8.000% Aaa 250,000 241,510
11/17/14 8.040% Aaa 500,000 483,418
01/14/15 8.000% Aaa 400,000 386,599
01/27/15 8.000% Aaa 500,000 485,242
02/09/15 8.000% Aaa 200,000 196,463
06/08/18 7.000% Aaa 500,000 452,486
--------------
4,688,259
--------------
FEDERAL HOME LOAN MORTGAGE CORPORATION - 3.69%
11/05/12 7.115% Aaa 800,000 747,504
03/18/13 6.650% Aaa 500,000 452,659
03/03/14 6.800% Aaa 200,000 181,413
04/14/14 6.950% Aaa 200,000 183,009
--------------
1,564,585
--------------
</TABLE>
18 =============================================================================
<PAGE>
ARISTATA FUNDS
================================================================================
ARISTATA QUALITY BOND FUND
STATEMENT OF INVESTMENTS
APRIL 30, 2000 (CONTINUED)
<TABLE>
<CAPTION>
Due Bond Rating** Principal
Date Coupon Moody's Amount Value*
---- ------ ------------- ---------- ------
<S> <C> <C> <C> <C>
U.S. GOVERNMENT &
AGENCY OBLIGATIONS (Continued)
FEDERAL NATIONAL MORTGAGE ASSOCIATION - 10.02%
06/08/00 5.570% Aaa $ 496,993 $ 496,765
06/30/04 6.930% Aaa 200,000 195,422
06/26/07 7.170% Aaa 500,000 483,103
01/29/08 6.460% Aaa 500,000 467,661
05/05/08 6.780% Aaa 250,000 236,652
02/04/09 6.030% Aaa 500,000 449,871
10/16/12 7.080% Aaa 400,000 373,578
12/03/12 6.920% Aaa 800,000 743,067
01/22/13 6.440% Aaa 500,000 449,534
10/16/14 8.000% Aaa 250,000 242,177
03/10/16 8.200% Aaa 105,000 113,054
-------------
4,250,884
-------------
TOTAL U.S. GOVERNMENT &
AGENCY OBLIGATIONS 16,581,118
-------------
(Cost $16,620,191)
<CAPTION>
Bond Rating**
Moody's/S&P
--------------
<S> <C> <C> <C> <C> <C>
CORPORATE BONDS - 55.30%
COMMUNICATIONS - 4.22% AT&T Corp.
03/15/09 6.000% A1/AA- 250,000 223,070
New York Telephone Co.
02/15/04 6.250% A2/A+ 500,000 476,305
Southern New England Telephone Co.
12/15/03 6.125% Aa3/AA 700,000 670,460
Southwestern Bell Telephone Co.
06/01/03 5.875% Aa2/AA 145,000 138,567
06/01/08 6.750% Aa3/AA 300,000 282,814
-------------
TOTAL COMMUNICATIONS 1,791,216
-------------
ELECTRIC UTILITIES - 2.48%
Consolidated Edison Co.
02/01/02 6.625% A1/A+ 800,000 789,758
Gulf Power Co.
08/15/04 7.050% A2/A 270,000 261,287
-------------
TOTAL ELECTRIC UTILITIES 1,051,045
-------------
FINANCIAL - 18.63%
AGRICULTURE - 0.98%
John Deere Capital Corp.
10/23/01 5.35% A2/A+ 430,000 417,282
-------------
AUTOMOBILE - 1.15%
Ford Motor Credit Co.
06/30/03 6.625% A1/A 500,000 486,307
-------------
BANKS/S & L/FINANCE/LEASE - 8.12%
Bank of America Corp.
05/12/05 7.125% Aa2/A+ 500,000 485,585
Bankers Trust New York Corp.
03/01/01 9.400% A3/A+ 350,000 355,718
01/15/02 7.500% A3/A+ 300,000 298,980
Bear Stearns Co.
04/13/03 6.750% A2/A 750,000 727,686
03/01/07 7.000% A2/A 250,000 234,623
Citicorp
08/15/05 6.750% A1/A+ 700,000 669,283
First Bank System
10/15/03 6.000% A1/A 500,000 471,008
NCNB Corp.
08/01/02 7.750% A2/A+ 200,000 199,530
-------------
3,442,413
-------------
BROKERS/FINANCIAL SERVICES - 5.59%
Charles Schwab Corp.
03/01/10 8.050% A3/A- 450,000 447,301
Dean Witter Discover Co.
03/01/03 6.875% Aa3/A+ 350,000 344,050
Merrill Lynch & Co.
04/27/08 7.000% Aa3/AA- 700,000 662,423
Morgan Stanley Dean Witter & Co.
10/15/01 8.875% Aa3/A+ 400,000 407,671
01/15/07 8.330% Aa3/A+ 500,000 510,675
-------------
2,372,120
-------------
</TABLE>
============================================================================= 19
<PAGE>
ARISTATA FUNDS
================================================================================
ARISTATA QUALITY BOND FUND
STATEMENT OF INVESTMENTS
APRIL 30, 2000 (CONTINUED)
<TABLE>
<CAPTION>
Due Bond Rating** Principal
Date Coupon Moody's/S&P Amount Value*
---- ------ ------------- ---------- ------
<S> <C> <C> <C> <C>
FINANCIAL (Continued)
INSURANCE - 2.79%
Allstate Insurance Corp.
06/15/03 6.750% A1/A $ 550,000 $ 531,266
CNA Financial Corp.
11/15/03 6.250% A3/A- 700,000 650,699
-------------
1,181,965
-------------
TOTAL FINANCIAL 7,900,087
-------------
INDUSTRIAL - 29.97%
AEROSPACE - 1.13%
Boeing Co.
06/15/03 6.350% A1/AA- 500,000 478,029
-------------
AUTOMOBILE - 1.95%
Ford Motor Company
09/15/01 9.000% A1/A 350,000 356,121
General Motors Corp.
05/01/05 6.250% A2/A 500,000 469,218
-------------
825,339
-------------
BROADCASTING/ENTERTAINMENT - 1.14%
Walt Disney Co.
03/30/06 6.750% A2/A 500,000 485,509
-------------
BUILDING MATERIALS - 2.27%
Hanson Trust PLC
01/15/03 7.375% A3/A 300,000 296,741
Martin Marietta Corp.
04/15/03 6.500% Baa1/BBB 700,000 666,694
-------------
963,435
-------------
BUSINESS INFORMATION/SERVICES - 1.66%
Xerox Corp.
04/15/02 8.125% A2/A 700,000 703,599
-------------
CHEMICALS - 1.65%
E. I. duPont de Nemours & Co.
03/15/04 8.125% Aa3/Aa- 200,000 204,940
ICI Wilmington, Inc.
01/15/02 7.500% Baa1/A- 500,000 496,996
-------------
701,936
-------------
DRUGS - 0.48%
Eli Lilly & Co.
12/01/01 8.125% Aa3/AA $ 200,000 $ 202,110
-------------
FOOD/BEVERAGE - 3.30%
Albertson's, Inc.
08/01/09 6.950% A2/A 150,000 140,653
Archer Daniels Midland Co.
05/15/03 6.250% Aa3/AA- 700,000 675,194
Philip Morris Cos., Inc.
05/15/02 7.625% A2/A 600,000 583,525
-------------
1,399,372
-------------
HOTEL/RESORT - 1.27%
Carnival Corp.
04/15/08 6.150% A2/A 600,000 538,621
-------------
HOUSEHOLD GOODS - 1.34%
Hasbro, Inc.
07/15/08 6.150% A2/A 300,000 262,561
Whirlpool Corp.
03/01/03 9.000% Baa1/BBB+ 300,000 307,217
-------------
569,778
-------------
INDUSTRIAL COMPONENTS - 1.18%
Ingersoll Rand Co.
08/07/00 6.540% A3/A- 500,000 499,522
-------------
METALS - 1.34%
Alcan Aluminum Ltd.
11/01/08 6.250% A2/A- 630,000 566,785
-------------
OFFICE EQUIPMENT/E.D.P. - 1.65%
International Business Machines Corp.
11/01/02 7.250% A1/A+ 700,000 699,523
-------------
OIL & GAS - 1.66%
British Petroleum Co.
05/15/02 7.875% Aa1/AA+ 700,000 706,271
-------------
</TABLE>
20 =============================================================================
<PAGE>
ARISTATA FUNDS
================================================================================
ARISTATA QUALITY BOND FUND
STATEMENT OF INVESTMENTS
APRIL 30, 2000 (CONTINUED)
<TABLE>
<CAPTION>
Due Bond Rating** Principal
Date Coupon Moody's/S&P Amount Value*
---- ------ ------------- ---------- ------
<S> <C> <C> <C> <C>
INDUSTRIAL (Continued)
OIL FIELD SERVICES - 1.65%
Dresser Industries, Inc.
06/01/00 6.250% Aa3/AA- $ 700,000 $ 699,518
-----------
PACKAGED GOODS - 1.08%
Fortune Brands, Inc.
04/01/08 6.250% A2/A 500,000 456,847
-----------
PAPER/PACKAGING - 1.81%
Avery Dennison Corp.
04/15/05 6.750% A2/A 800,000 766,478
-----------
RESTAURANTS - 1.58%
McDonalds Corp.
09/01/05 6.625% Aa2/AA 700,000 671,602
-----------
RETAIL - 1.83%
Dillard's, Inc.
06/01/06 7.375% Baa1/BBB 500,000 430,746
Wal-Mart Stores, Inc.
08/10/01 6.150% Aa2/AA 350,000 346,150
-----------
776,896
-----------
TOTAL INDUSTRIAL 12,711,170
-----------
TOTAL CORPORATE BONDS 23,453,518
(Cost $24,153,304) -----------
<CAPTION>
Shares Value*
------ ------
<S> <C> <C>
SHORT-TERM INVESTMENTS - 3.77%
MUTUAL FUNDS - 3.77%
Fifth Third C/P Fund 1,207,185 $ 1,207,185
Fifth Third U.S. Treasury Fund 389,669 389,669
-----------
TOTAL SHORT-TERM INVESTMENTS 1,596,854
-----------
(Cost $1,596,854)
TOTAL INVESTMENTS 98.17% 41,631,490
(Cost $42,370,349)
Other Assets in Excess
of Liabilities 1.83% 776,848
------------------------
NET ASSETS 100.00% $42,408,338
========================
</TABLE>
*See note 1 to financial statements.
**Ratings - The Moody's and S&P ratings are believed to be the most recent
ratings at April 30, 2000. Ratings are not covered by the Report of Independent
Auditors.
============================================================================= 21
<PAGE>
ARISTATA FUNDS
================================================================================
ARISTATA COLORADO QUALITY TAX-EXEMPT FUND
STATEMENT OF INVESTMENTS
APRIL 30, 2000
<TABLE>
<CAPTION>
Due Bond Rating** Principal
Date Coupon Moody's/S&P Amount Value*
---- ------ ------------- ---------- ------
<S> <C> <C> <C> <C>
COLORADO MUNICIPAL OBLIGATIONS - 95.71%
PREREFUNDED - 23.96%
Arapahoe County, GO
School District #5
12/15/10 7.125% Aa2/AA $ 200,000 $ 205,372
Colorado Springs Utilities System, Rev
11/15/15 6.500% Aa2/AAA 15,000 15,689
Denver City & County
School District #1
Certificates of Participation
12/01/06 6.600% A/A 500,000 525,455
El Paso County
School District #38
Certificates of Participation
12/01/05 6.750% A1/NR 400,000 415,896
Fort Collins Storm Drainage, Rev
12/01/11 6.625% A1/NR 300,000 311,775
Greeley Water, GO
12/01/11 6.600% A1/AA- 400,000 411,892
Platte River Power Authority, Rev
06/01/18 5.750% Aaa/A+ 900,000 899,901
South Suburban, Rev
Park & Recreation District, FGIC
12/15/10 6.700% Aaa/AAA 500,000 520,585
---------
TOTAL PREREFUNDED 3,306,565
---------
(Cost $2,979,259)
GENERAL OBLIGATION BONDS - 42.77%
Adams County
School District #12, FGIC
12/15/09 5.250% Aaa/AAA 500,000 502,035
Adams County
School District #50
12/01/10 5.250% A1/AA- 500,000 497,170
Boulder County Library
10/01/06 5.900% Aa1/AA+ 300,000 307,089
Boulder County Open Space
06/15/08 5.100% NR/AA 500,000 496,950
Boulder Valley
School District #Re-2
10/15/08 6.250% A1/AA 500,000 509,930
Boulder Valley
School District #Re-2, FGIC
12/01/13 5.000% Aaa/AAA 150,000 142,191
Clear Creek County
School District #Re-1, FSA
12/01/17 5.750% Aaa/AAA 100,000 100,704
Douglas County
School District #Re-1, MBIA
12/15/03 5.650% Aaa/AAA 400,000 409,548
Fort Collins Water
12/01/02 6.000% Aa1/AA 200,000 205,674
Highlands Ranch
Metropolitan District #4
12/01/01 5.200% Aa1/AA+ 250,000 252,010
12/01/03 5.375% Aa1/AA+ 250,000 253,690
Morgan County
School District #Re-3, AMBAC
12/01/18 4.800% Aaa/AAA 250,000 217,253
San Miguel County
School District #R-1, MBIA
12/01/06 5.200% Aaa/AAA 500,000 502,745
South Suburban Park &
Recreation District, FGIC
12/15/06 5.050% Aaa/AAA 500,000 500,585
Summit County
School District #Re-1, FGIC
12/01/07 5.250% Aaa/AAA 500,000 503,345
Thornton, FSA
12/01/07 5.150% Aaa/AAA 500,000 501,220
---------
TOTAL GENERAL OBLIGATION BONDS 5,902,139
(Cost $5,875,042) ---------
REVENUE BONDS - 28.98%
EDUCATION - 0.92%
Colorado EDL & Cultural
12/01/16 6.000% NR/AA 125,000 126,359
---------
</TABLE>
22 =============================================================================
<PAGE>
ARISTATA FUNDS
================================================================================
ARISTATA COLORADO QUALITY TAX-EXEMPT FUND
STATEMENT OF INVESTMENTS
APRIL 30, 2000 (CONTINUED)
<TABLE>
<CAPTION>
Due Bond Rating** Principal
Date Coupon Moody's/S&P Amount Value*
---- ------ ------------- ---------- ------
<S> <C> <C> <C> <C>
FINANCE - 8.04%
Aspen Colorado Sales Tax
11/01/10 5.000% NR/A- $ 120,000 $ 114,613
Broomfield Colorado Sales & Use Tax, AMBAC
06/01/05 6.000% Aaa/AAA 300,000 307,338
Boulder Colorado Sales Tax, AMBAC
08/15/13 5.150% Aaa/AAA 100,000 96,950
Douglas County Sales & Use Tax, MBIA
10/15/17 5.250% Aaa/AAA 300,000 302,280
Durango Colorado Sales & Use Tax, FGIC
12/01/06 5.500% Aaa/AAA 200,000 198,058
Jefferson County Open Space, FGIC
11/01/19 5.000% Aaa/AAA 100,000 89,247
---------
1,108,486
---------
HOSPITAL - 1.54%
University of Colorado
Hospital Authority, AMBAC
11/15/09 5.000% Aaa/NR 220,000 212,700
---------
HOUSING - 1.92%
Colorado Housing Finance Authority
Single Family Housing
11/01/14 7.150% Aa1/AAA 225,000 229,451
Commerce City
Single Family Housing
03/01/12 6.875% Aaa/NR 35,000 35,062
---------
264,513
POWER - 3.19%
Adams County
Pollution Control, MBIA
04/01/08 5.625% Aaa/AAA 300,000 304,566
Pueblo County
Pollution Control, AMBAC
01/01/19 5.100% Aaa/AAA 150,000 135,854
---------
440,420
---------
TRANSPORTATION - 4.00%
Arapahoe County
Highway E-470, MBIA
08/31/05 5.150% Aaa/AAA 250,000 251,487
Denver City & County
Airport, MBIA
11/15/16 5.750% Aaa/AAA 300,000 300,993
---------
552,480
WATER/SEWER - 9.37%
Colorado Water Reservoir & Power
Development Authority, FGIC
11/01/06 6.550% Aaa/AAA 500,000 518,415
Colorado Water Reservoir & Power
Development Authority
09/01/07 5.250% Aaa/AAA 250,000 253,170
Fountain Valley Authority
Water Treatment
12/01/07 5.200% Aa2/AA 400,000 401,220
Pueblo Colorado Board
Waterworks, FSA
11/01/09 5.250% Aaa/AAA 120,000 120,803
---------
1,293,608
---------
TOTAL REVENUE BONDS 3,998,566
---------
(Cost $3,976,381)
TOTAL COLORADO MUNICIPAL
OBLIGATIONS 13,207,270
(Cost $12,830,682) ----------
TOTAL INVESTMENTS 95.71% 13,207,270
(Cost $12,830,682)
Other Assets in Excess
of Liabilities 4.29% 592,114
------------------------
NET ASSETS 100.00% $13,799,384
=========================
</TABLE>
*See Note 1 to financial statements
**Ratings - The Moody's and S&P ratings are believed to be the most recent
ratings at April 30, 2000. Ratings are not covered by the Report of Independent
Auditors.
The Aristata Colorado Quality Tax-Exempt Fund had the following insurance
concentration greater than 10% at April 30, 2000 (as a percentage of net
assets):
FGIC 21.6%
MBIA 15.0%
============================================================================= 23
<PAGE>
ARISTATA FUNDS
================================================================================
<TABLE>
<CAPTION>
STATEMENTS OF ASSETS AND LIABILITIES
APRIL 30, 2000
COLORADO QUALITY
EQUITY QUALITY BOND TAX-EXEMPT
----------------------------------------------------------
ASSETS:
<S> <C> <C> <C>
Investments, at value (Cost - see below) $73,061,774 $41,631,490 $13,207,270
Cash 0 0 363,543
Dividends receivable 63,825 0 0
Interest receivable 5,761 808,126 276,100
Receivable for portfolio shares sold 9,870 6,667 3,318
Organizational costs, net of accumulated amortization 22,035 15,267 5,777
Prepaid and other assets 4,200 4,338 236
----------------------------------------------------------
Total Assets 73,167,465 42,465,888 13,856,244
----------------------------------------------------------
LIABILITIES:
Payable for portfolio shares redeemed 31,649 1,029 0
Accrued investment advisory fee 42,387 12,764 598
Accrued administration fee 13,770 6,885 4,603
Dividends payable 0 35,081 47,305
Other payables 3,894 1,791 4,354
----------------------------------------------------------
Total Liabilities 91,700 57,550 56,860
----------------------------------------------------------
NET ASSETS $73,075,765 $42,408,338 $13,799,384
==========================================================
COST OF INVESTMENTS $42,597,078 $42,370,349 $12,830,682
==========================================================
COMPOSITION OF NET ASSETS:
Paid-in capital $37,327,324 $43,453,111 $13,430,583
Un (Over)-distributed net investment income 15,837 46,681 (616)
Accumulated net realized gain (loss) on investments 5,267,908 (352,595) (7,171)
Net unrealized appreciation/depreciation in value
of investments 30,464,696 (738,859) 376,588
----------------------------------------------------------
NET ASSETS $73,075,765 $42,408,338 $13,799,384
==========================================================
NET ASSET VALUE PER SHARE:
Net Assets $73,075,765 $42,408,338 $13,799,384
Shares of beneficial interest outstanding 7,823,108 4,549,795 1,475,276
Net asset value and redemption price per share $9.34 $9.32 $9.35
</TABLE>
See notes to financial statements.
24 =============================================================================
<PAGE>
ARISTATA FUNDS
================================================================================
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED APRIL 30, 2000
<TABLE>
<CAPTION>
COLORADO QUALITY
EQUITY QUALITY BOND TAX-EXEMPT
-----------------------------------------------------------
INVESTMENT INCOME:
<S> <C> <C> <C>
Interest $ 91,313 $ 3,240,032 $ 846,408
Dividends 1,756,457 0 0
-----------------------------------------------------------
Total Income 1,847,770 3,240,032 846,408
-----------------------------------------------------------
EXPENSES:
Investment advisory fee (Note 4) 711,462 235,640 79,757
Administration fee (Note 4) 184,289 94,907 59,709
Legal 0 1,880 0
Registration 6,130 3,511 0
Amortization of organization costs 7,640 4,896 1,613
Insurance 3,567 2,424 837
Other 1,947 9,729 5,664
-----------------------------------------------------------
Total Expenses Before Waiver 915,035 352,987 147,580
Expenses waived by investment adviser (Note 4) (66,862) (31,221) (70,730)
-----------------------------------------------------------
Net Expenses 848,173 321,766 76,850
-----------------------------------------------------------
NET INVESTMENT INCOME 999,597 2,918,266 769,558
-----------------------------------------------------------
Net realized gain (loss) on investments 7,272,554 (352,653) (8,323)
Change in net unrealized appreciation/depreciation (7,096,604) (2,479,723) (761,940)
-----------------------------------------------------------
Net gain (loss) on investments 175,950 (2,832,376) (770,263)
-----------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS $1,175,547 $ 85,890 $ (705)
===========================================================
</TABLE>
See notes to financial statements.
============================================================================= 25
<PAGE>
ARISTATA FUNDS
================================================================================
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
EQUITY FUND
-------------------------------------------------
For the Year Ended
April 30, 2000 April 30, 1999
-------------------------------------------------
OPERATIONS:
<S> <C> <C>
Net investment income $ 999,597 $ 1,319,576
Net realized gain on investments 7,272,554 11,378,470
Change in net unrealized appreciation/depreciation (7,096,604) (4,767,687)
-----------------------------------------------
Net increase in net assets from operations 1,175,547 7,930,359
-----------------------------------------------
DISTRIBUTIONS:
From net investment income (976,762) (1,335,710)
From net realized gain (13,382,921) (1,236,442)
-----------------------------------------------
Net decrease in net assets from distributions (14,359,683) (2,572,152)
-----------------------------------------------
SHARE TRANSACTIONS (NOTE 2):
Proceeds from sale of shares 7,802,900 4,205,574
Reinvested dividends 10,563,696 1,905,608
Cost of shares redeemed (26,479,442) (18,710,476)
-----------------------------------------------
Net decrease in net assets from share transactions (8,112,846) (12,599,294)
-----------------------------------------------
NET DECREASE IN NET ASSETS (21,296,982) (7,241,087)
-----------------------------------------------
NET ASSETS:
Beginning of period 94,372,747 101,613,834
-----------------------------------------------
End of period* $ 73,075,765 $ 94,372,747
===============================================
*Includes un (over)-distributed net investment income of $ 15,837 $ (6,998)
</TABLE>
See notes to financial statements.
26 =============================================================================
<PAGE>
ARISTATA FUNDS
================================================================================
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
QUALITY BOND FUND
--------------------------------------------------
For the Year Ended
April 30, 2000 April 30, 1999
--------------------------------------------------
OPERATIONS:
<S> <C> <C>
Net investment income $ 2,918,266 $ 3,417,107
Net realized gain (loss) on investments (352,653) 45,793
Change in net unrealized appreciation/depreciation (2,479,723) (474,807)
--------------------------------------------------
Net increase in net assets from operations 85,890 2,988,093
--------------------------------------------------
DISTRIBUTIONS:
From net investment income (2,891,225) (3,397,538)
From net realized gain 0 (96,912)
--------------------------------------------------
Net decrease in net assets from distributions (2,891,225) (3,494,450)
--------------------------------------------------
SHARE TRANSACTIONS (NOTE 2):
Proceeds from sale of shares 8,892,852 6,356,700
Reinvested dividends 2,346,208 2,771,436
Cost of shares redeemed (18,005,611) (14,151,265)
--------------------------------------------------
Net decrease in net assets from share transactions (6,766,551) (5,023,129)
--------------------------------------------------
NET DECREASE IN NET ASSETS (9,571,886) (5,529,486)
--------------------------------------------------
NET ASSETS:
Beginning of period 51,980,224 57,509,710
--------------------------------------------------
End of period* $ 42,408,338 $ 51,980,224
==================================================
*Includes undistributed net investment income of $ 46,681 $ 19,640
</TABLE>
See notes to financial statements.
============================================================================= 27
<PAGE>
ARISTATA FUNDS
================================================================================
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
COLORADO QUALITY TAX-EXEMPT FUND
--------------------------------------------------
For the Year Ended
April 30, 2000 April 30, 1999
--------------------------------------------------
OPERATIONS:
<S> <C> <C>
Net investment income $ 769,558 $ 958,847
Net realized gain (loss) on investments (8,323) 323,738
Change in net unrealized appreciation/depreciation (761,940) (207,450)
--------------------------------------------------
Net increase (decrease) in net assets from operations (705) 1,075,135
--------------------------------------------------
DISTRIBUTIONS:
From net investment income (769,558) (959,483)
From net realized gain (152,140) (166,233)
--------------------------------------------------
Net decrease in net assets from distributions (921,698) (1,125,716)
--------------------------------------------------
SHARE TRANSACTIONS (NOTE 2):
Proceeds from sale of shares 964,517 710,520
Reinvested dividends 132,915 118,629
Cost of shares redeemed (3,877,483) (6,657,337)
--------------------------------------------------
Net decrease in net assets from share transactions (2,780,051) (5,828,188)
--------------------------------------------------
NET DECREASE IN NET ASSETS (3,702,454) (5,878,769)
--------------------------------------------------
NET ASSETS:
Beginning of period 17,501,838 23,380,607
--------------------------------------------------
End of period* 13,799,384 $17,501,838
==================================================
*Includes over-distributed net investment income of $ (616) $ (616)
</TABLE>
See notes to financial statements.
28 =============================================================================
<PAGE>
ARISTATA FUNDS
================================================================================
FINANCIAL HIGHLIGHTS
Selected data for a share of beneficial interest outstanding throughout the
period indicated:
<TABLE>
<CAPTION>
EQUITY FUND
----------------------------------------------------------
For the Period
For the Year Ended March 2, 1998
April 30, 2000 April 30, 1999 to April 30, 1998
----------------------------------------------------------
SELECTED PER-SHARE DATA:
<S> <C> <C> <C>
Net asset value - beginning of period $ 11.11 $ 10.44 $ 10.00
----------------------------------------------------------
Income from investment operations:
Net investment income 0.12 0.14 0.01
Net realized and unrealized gain (loss) on investments (0.01) 0.81 0.44
----------------------------------------------------------
Total income from investment operations 0.11 0.95 0.45
----------------------------------------------------------
Distributions:
From net investment income (0.12) (0.14) (0.01)
From net realized gain (1.76) (0.14) --
----------------------------------------------------------
Total distributions (1.88) (0.28) (0.01)
----------------------------------------------------------
Net asset value - end of period $ 9.34 $ 11.11 $ 10.44
==========================================================
TOTAL RETURN 2.23% 9.39% 4.54%
==========================================================
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of period (000) $ 73,076 $ 94,373 $ 101,614
==========================================================
Ratio of expenses to average net assets 1.01% 0.95% 0.95%(1)
==========================================================
Ratio of net investment income to
average net assets 1.20% 1.41% 0.84%(1)
==========================================================
Ratio of expenses to average net
assets without fee waivers 1.09% 1.11% 1.17%(1)
==========================================================
Ratio of net investment income to
average net assets without fee waivers 1.12% 1.25% 0.62%(1)
==========================================================
Portfolio turnover rate 16.63% 25.26% 14.20%(1)
==========================================================
</TABLE>
(1) Annualized
See notes to financial statements.
============================================================================= 29
<PAGE>
ARISTATA FUNDS
================================================================================
FINANCIAL HIGHLIGHTS
Selected data for a share of beneficial interest outstanding throughout the
period indicated:
<TABLE>
<CAPTION>
QUALITY BOND FUND
----------------------------------------------------------
For the Period
For the Year Ended March 2, 1998
April 30, 2000 April 30, 1999 to April 30, 1998
----------------------------------------------------------
SELECTED PER-SHARE DATA:
<S> <C> <C> <C>
Net asset value - beginning of period $9.88 $9.97 $10.00
----------------------------------------------------------
Income from investment operations:
Net investment income 0.59 0.62 0.10
Net realized and unrealized loss on investments (0.57) (0.08) (0.03)
----------------------------------------------------------
Total income from investment operations 0.02 0.54 0.07
----------------------------------------------------------
Distributions:
From net investment income (0.58) (0.61) (0.10)
From net realized gain -- (0.02) --
----------------------------------------------------------
Total distributions (0.58) (0.63) (0.10)
----------------------------------------------------------
Net asset value - end of period $9.32 $9.88 $9.97
==========================================================
TOTAL RETURN 0.28% 5.49% 0.69%
==========================================================
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of period (000) $42,408 $51,980 $57,510
==========================================================
Ratio of expenses to average net assets 0.68% 0.65% 0.65%(1)
==========================================================
Ratio of net investment income to
average net assets 6.16% 6.10% 6.00%(1)
==========================================================
Ratio of expenses to average net
assets without fee waivers 0.75% 0.76% 0.83%(1)
==========================================================
Ratio of net investment income to
average net assets without fee waivers 6.10% 5.99% 5.82%(1)
==========================================================
Portfolio turnover rate 10.06% 9.79% 11.44%(1)
==========================================================
</TABLE>
(1) Annualized
See notes to financial statements.
30 =============================================================================
<PAGE>
ARISTATA FUNDS
================================================================================
FINANCIAL HIGHLIGHTS
Selected data for a share of beneficial interest outstanding throughout the
period indicated:
<TABLE>
<CAPTION>
COLORADO QUALITY TAX-EXEMPT FUND
---------------------------------------------------------------
For the Period
For the Year Ended March 2, 1998
April 30, 2000 April 30, 1999 to April 30, 1998
---------------------------------------------------------------
SELECTED PER-SHARE DATA:
<S> <C> <C> <C>
Net asset value - beginning of period $ 9.89 $ 9.94 $ 10.00
---------------------------------------------------------------
Income from investment operations:
Net investment income 0.46 0.49 0.08
Net realized and unrealized gain (loss) on investments (0.45) 0.04 (0.06)
---------------------------------------------------------------
Total income from investment operations 0.01 0.53 0.02
---------------------------------------------------------------
Distributions:
From net investment income (0.46) (0.49) (0.08)
From net realized gain (0.09) (0.09) --
---------------------------------------------------------------
Total distributions (0.55) (0.58) (0.08)
---------------------------------------------------------------
Net asset value - end of period $ 9.35 $ 9.89 $ 9.94
===============================================================
TOTAL RETURN 0.16% 5.40% 0.22%
===============================================================
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of period (000) $13,799 $17,502 $23,381
===============================================================
Ratio of expenses to average net assets 0.48% 0.45% 0.45%(1)
===============================================================
Ratio of net investment income to
average net assets 4.85% 4.85% 5.00%(1)
===============================================================
Ratio of expenses to average net
assets without fee waivers 0.93% 0.91% 0.92%(1)
===============================================================
Ratio of net investment income to
average net assets without fee waivers 4.41% 4.40% 4.53%(1)
===============================================================
Portfolio turnover rate 12.41% 7.86% 17.64%(1)
===============================================================
</TABLE>
(1) Annualized
See notes to financial statements.
============================================================================= 31
<PAGE>
ARISTATA FUNDS
================================================================================
NOTES TO FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES
Financial Investors Trust, a Delaware business trust, is registered
under the Investment Company Act of 1940, as amended, as an open-end management
investment company. The financial statements included herein relate to the
Trust's Aristata Family of Funds. The Aristata Family of Funds includes the
Equity Fund, Quality Bond Fund and Colorado Quality Tax-Exempt Fund. The
financial statements of the remaining portfolios of the Trust are presented
separately.
The following is a summary of significant accounting policies
consistently followed by the Funds in the preparation of their financial
statements. The policies are in conformity with generally accepted accounting
principles.
INVESTMENT VALUATION: Securities of the Funds are valued at 4:00 p.m.
(Eastern time) on each trading day. Listed and unlisted securities for which
such information is regularly reported are valued at the last sales price of the
day or, in the absence of sales, at values based on the average closing bid and
asked price. Securities for which market quotations are not readily available
are valued under procedures established by the Board of Trustees to determine
fair value in good faith. Short-term securities having a remaining maturity of
60 days or less are valued at amortized cost which approximates market value.
FEDERAL INCOME TAXES: It is the Funds' policy to comply with the
provisions of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of their taxable income to shareholders.
Therefore, no federal income tax provision is required.
DIVIDENDS: The Aristata Equity Fund will declare and pay dividends
from net investment income, if any, quarterly. Dividends from net investment
income are declared daily and paid monthly for the Aristata Quality Bond and
Colorado Quality Tax-Exempt Funds. Dividends from net realized gains, if any,
are declared at least once a year. Dividends to shareholders are recorded on the
ex-dividend date.
Income and capital gains to be distributed are determined in
accordance with income tax regulations which may differ from income andgains
reported under generally accepted accounting principles. For the year ended
April 30, 2000, the effects of certain differences due to a market discount
reclass were reclassified. The Quality Bond Fund reflected an increase in
undistributed net investment income and an increase in accumulated net
realized loss on investments of $27,041.
ORGANIZATION COSTS: The Funds have deferred certain costs incurred in
connection with the organization, initial registration and public offering of
Fund shares. Such costs are being amortized over a 60 month period from the
commencement of operations. As of April 30, 2000, the remaining period of
amortization was 34 months.
OTHER: Investment transactions are accounted for on the date the
investments are purchased or sold (trade date). Dividend income is recorded on
the ex-dividend date. Interest income is accrued and recorded daily. Realized
gains and losses from investment transactions and unrealized appreciation and
depreciation of investments are reported on an identified cost basis which is
the same basis the Funds use for federal income tax purposes.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from these estimates.
32 =============================================================================
<PAGE>
ARISTATA FUNDS
================================================================================
NOTES TO FINANCIAL STATEMENTS ((CONTINUED)
2. SHARES OF BENEFICIAL INTEREST
On April 30, 2000, there was an unlimited number of no par value
shares of beneficial interest authorized for each fund. Transactions in shares
of beneficial interest were as follows:
<TABLE>
<CAPTION>
ARISTATA COLORADO QUALITY
ARISTATA EQUITY FUND ARISTATA QUALITY BOND FUND TAX-EXEMPT FUND
-------------------- --------------------------- --------------------------
For the Year Ended April 30, For the Year Ended April 30, For the Year Ended April 30,
2000 1999 2000 1999 2000 1999
------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Shares sold 794,677 421,685 934,245 632,574 100,351 71,070
Shares issued as
reinvestment of dividends 1,204,528 189,946 246,348 275,733 13,982 11,855
Shares redeemed (2,674,291) (1,845,964) (1,892,464) (1,413,235) (409,379) (663,763)
-------------------------------------------------------------------------------------------------------------------------------
Net Decrease (675,086) (1,234,333) (711,871) (504,928) (295,046) (580,838)
===============================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
3. UNREALIZED GAINS AND LOSSES ON INVESTMENTS
ARISTATA COLORADO QUALITY
ARISTATA EQUITY FUND ARISTATA QUALITY BOND FUND TAX-EXEMPT FUND
-------------------- --------------------------- -------------------------
As of April 30, 2000
<S> <C> <C> <C>
Gross appreciation (excess of
value over cost) 31,163,177 811,983 445,026
Gross depreciation (excess of
cost over value) (698,481) (1,550,842) (68,438)
-----------------------------------------------------------------------------------------------------------------------------------
Net unrealized appreciation 30,464,696 (738,859) 376,588
===================================================================================================================================
</TABLE>
4. INVESTMENT ADVISORY FEES, ADMINISTRATION FEES AND OTHER RELATED PARTY
TRANSACTIONS
Tempest, Isenhart, Chafee, Lansdowne & Associates, Inc. (the
"Adviser") serves as investment adviser to each Fund pursuant to separate
investment advisory agreements (the "Advisory Agreements") with the Trust. For
its services, the Adviser is entitled to receive a fee, computed daily and
payable monthly, at the annual rate of 0.85%, 0.50% and 0.50% of the average net
assets for the Aristata Equity Fund, Aristata Quality Bond Fund and Aristata
Colorado Quality Tax-Exempt Fund, respectively. The Adviser has agreed to
voluntarily waive a portion of its fees so that the total annual expenses of
each Fund will not exceed the voluntary expense limitations adopted by the
Adviser. Fee waivers by the Adviser are voluntary and may be terminated at any
time.
ALPSMutual Funds Services, Inc. ("ALPS") serves as the administrator
to each Fund. ALPS is entitled to receive a fee from each Fund, computed daily
and payable monthly, at the annual rate of .20% of the average net assets of
each Fund, subject to a minimum monthly fee of $15,000 for the Aristata Equity
Fund, $7,500 for the Aristata Quality Bond Fund and $5,000 for the Aristata
Colorado Quality Tax-Exempt Fund. In addition to administration services, the
administration fee also covers the costs of fund accounting, custody,
shareholder servicing, transfer agency, audit and Trustees' fees.
============================================================================= 33
<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
As of April 30, 2000, one shareholder owned 37 percent and 39 percent
of the outstanding shares of the Aristata Equity Fund and Aristata Quality Bond
Fund, respectively.
5. INVESTMENT TRANSACTIONS
The cost of securities purchased and proceeds from the sale of
securities, other than temporary cash investments, during the year ended April
30, 2000 were as follows:
<TABLE>
<CAPTION>
U.S. GOVERNMENT
SECURITIES ALL OTHER TOTAL
----------------------------------------------------------------------------------------
ARISTATA EQUITY FUND
<S> <C> <C> <C>
Purchases $ 0 $13,670,158 $13,670,158
Sales $ 0 $34,581,321 $34,581,321
ARISTATA QUALITY BOND FUND
Purchases $ 3,050,000 $ 1,470,966 $ 4,520,966
Sales $ 6,048,403 $ 6,437,508 $12,485,911
ARISTATA COLORADO QUALITY
TAX-EXEMPT FUND
Purchases $ 0 $ 1,886,590 $ 1,886,590
Sales $ 0 $ 4,432,872 $ 4,432,872
</TABLE>
6. CONVERSION OF COMMINGLED POOLS
Each Fund, at its inception date (March 2, 1998), issued shares at
$10.00 per share in a tax-free conversion to acquire the net assets of certain
unregistered commingled pools of Colorado State Bank and Trust. The following is
a summary of shares issued, net assets acquired and unrealized appreciation as
of March 2, 1998:
<TABLE>
<CAPTION>
ARISTATA COLORADO QUALITY
ARISTATA EQUITY FUND ARISTATA QUALITY BOND FUND TAX-EXEMPT FUND
-------------------- -------------------------- -------------------------
<S> <C> <C> <C>
Shares issued 9,855,292 5,759,904 2,472,885
Net assets acquired $98,552,917 $57,599,038 $24,728,848
Unrealized appreciation $39,252,218 $ 2,425,692 $ 1,470,209
</TABLE>
7. SHAREHOLDER TAX INFORMATION (Unaudited)
During the period ended April 30, 2000, 100% of the dividends paid by
the Aristata Colorado Quality Tax-Exempt Fund from net investment income should
be treated as tax-exempt dividends and 100% of the dividends paid by the
Aristata Equity Fund from net investment income qualify for the corporate
dividends received deduction.
34 =============================================================================
<PAGE>
================================================================================
INTENTIONALLY
LEFT BLANK
================================================================================
============================================================================= 35
