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NORWEST
PASSAGE(R)
........... NORWEST SELECT FUNDS
SEMI-ANNUAL REPORT FOR:
VARIABLE ANNUITY INTERMEDIATE BOND FUND
INCOME EQUITY FUND
VALUGROWTH(SM) STOCK FUND
SMALL COMPANY STOCK FUND
[Norwest Passage Logo]
JUNE 30, 1997
Norwest Passage Variable Annuity
is distributed by Fortis Investors, Inc.
Norwest Select Funds are not insured by the FDIC, Federal Reserve System, U.S.
government, or any other government agency; are not bank deposits; are not
obligations of, or guaranteed or endorsed by any bank and are subject to
investment risk, including the possible loss of principal. Forum Financial
Services, Inc. is distributor of Norwest Select Funds. Please see inside cover
for additional disclosure information.
<PAGE>
Norwest Select Funds is a family of open-end investment companies commonly known
as mutual funds. FORUM FINANCIAL SERVICES, INC. ("FORUM"), MEMBER NASD, is the
distributor of Norwest Select Funds. Forum is not affiliated with Norwest
Corporation, Norwest Bank Minnesota, N.A. or Norwest Investment Services, Inc.
SHARES OF THE FUNDS ARE NOT INSURED OR GUARANTEED BY OR ARE NOT OBLIGATIONS OF
THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE SYSTEM, THE U.S.
GOVERNMENT OR ANY GOVERNMENT AGENCY. EVEN THOUGH NORWEST INVESTMENT MANAGEMENT,
A PART OF NORWEST BANK MINNESOTA, N.A. (THE "BANK"), ACTS AS THE INVESTMENT
ADVISER, AND THE BANK ACTS AS THE TRANSFER AGENT AND CUSTODIAN OF NORWEST SELECT
FUNDS, AND EACH RECEIVES FEES FOR SUCH SERVICES AS DISCLOSED IN THE PROSPECTUS,
SHARES OF THE FUNDS ARE NOT BANK DEPOSITS, AND ARE NOT OBLIGATIONS OF,
GUARANTEED OR ENDORSED BY THE BANK, ANY OTHER BANK, OR ANY OF THE BANK'S
AFFILIATES, INCLUDING NORWEST CORPORATION AND NORWEST INVESTMENT SERVICES, INC.,
NOR ARE THEY GUARANTEED BY OR DO THEY CONSTITUTE OBLIGATIONS OF FORUM.
INVESTMENT IN SHARES OF MUTUAL FUNDS IS SUBJECT TO RISK, INCLUDING THE POSSIBLE
LOSS OF PRINCIPAL, THAT MAY CAUSE THE VALUE OF THE INVESTMENT AND THE INVESTMENT
RETURN TO FLUCTUATE. WHEN THE INVESTMENT IS SOLD, THE VALUE MAY BE HIGHER OR
LOWER THAN THE AMOUNT ORIGINALLY INVESTED.
Mutual funds are sold only by prospectus. Shares of the Norwest Select Funds are
currently sold only to separate accounts ("Separate Accounts") of certain
insurance companies (the "Insurance Companies"), as each Fund of the Trust
serves as an investment medium for variable life insurance policies and variable
annuity contracts (collectively the "Contracts") issued by the Insurance
Companies.
<PAGE>
NORWEST SELECT FUNDS
TABLE OF CONTENTS JUNE 30, 1997
A MESSAGE TO CONTRACT HOLDERS ................................................1
FINANCIAL STATEMENTS
Statements of Assets and Liabilities ...................................2
Statements of Operations................................................3
Statements of Changes in Net Assets ....................................4
Financial Highlights....................................................5
Notes to Financial Statements ..........................................7
Schedules of Investments
Intermediate Bond Fund ...........................................10
Income Equity Fund ...............................................12
ValuGrowthSM Stock Fund ..........................................14
Small Company Stock Fund .........................................17
<PAGE>
NORWEST SELECT FUNDS
A MESSAGE TO CONTRACT HOLDERS
- --------------------------------------------------------------------------------
August 12, 1997
Dear Contract Holders:
We are pleased to present the 1997 Semi-Annual Report to Contract Holders for
the Norwest Select Funds. Norwest Select Funds experienced significant growth
over the last year, with net assets increasing from six months ago by more than
50%. We strongly believe that this success is the result of the confidence and
support of our contract holders borne from the continued positive performance of
our Funds. While past performance is not indicative of future results, we
believe the Funds are positioned well for the coming year.
The stock market continued its torrid pace over the past year with the Standard
& Poor's 500 Index returning 20.60% for the six months ended June 30, 1997,
compared to a 14.63% average annual return for the past ten years. The bond
market, however, did not keep pace with the S&P, with the Lehman Brothers
Aggregate Bond Index returning 3.09% over the same period, compared to an 8.82%
average annual return over the past ten years.
Both the stock and bond markets were plagued by short-term volatility swings. A
small handful of the very large, blue-chip stocks propelled the returns of the
S&P as the market continued to reward companies that hit their forecasted
earnings and to pummel those that did not. In addition, within the various
segments of the stock market, there were large variations in performance --
small companies significantly trailed large companies, interest-rate sensitive
sectors did not fare as well as non-interest-rate sensitive sectors, and
technology stocks experienced significant volatility.
The bond markets continued to react quickly to changes in financial news,
particularly news on inflation. Signs of a strengthening economy -- tight labor
markets, low interest rates and consistently strong corporate earnings --
refueled fears of inflation. As a possible preemptive strike, the Fed raised the
Fed Funds rate, the rate banks charge each other for overnight loans, by 0.25%
this past March. In May of this year, the Fed decided that the economy was
growing at a sustainable rate and left the Fed Funds rate alone.
In a volatile market environment like this past year, discriminating stock
picking and discerning bond selection -- which is what we do best -- will play
vital roles in providing notable performance results. If you have any questions
or would like additional information about the Norwest Select Funds, please call
(800) 338-1348 or (612) 667-8833 (press 1). For variable annuity information,
please call Fortis Benefits Insurance Company at (800) 780-7743. We appreciate
your decision to invest with our Norwest Select Funds.
Sincerely,
John Y. Keffer
CHAIRMAN AND PRESIDENT
NORWEST SELECT FUNDS
- --------------------------------------------------------------------------------
1
<PAGE>
NORWEST SELECT FUNDS
STATEMENTS OF ASSETS AND LIABILITIES (UNAUDITED) June 30, 1997
<TABLE>
<S> <C> <C> <C> <C>
INTERMEDIATE INCOME VALUGROWTH(SM) SMALL COMPANY
BOND EQUITY STOCK STOCK
FUND FUND FUND FUND
-------------------- ------------------- ------------------- --------------------
ASSETS
Investments (Note 2)
Investments at cost $ 7,055,578 $ 17,982,955 $ 12,219,367 $ 7,273,941
Net unrealized appreciation (depreciation) 5,377 2,437,216 3,403,207 915,616
-------------------- ------------------- ------------------- --------------------
Total investments at value 7,060,955 20,420,171 15,622,574 8,189,557
Interest, dividends and other receivables 101,982 52,900 33,443 17,148
Receivable for Fund shares sold 14,740 101,514 44,273 29,420
Receivable for investments sold - - 242,146 215,083
Receivable from Manager 14,579 - - -
Organization Costs, net of amortization (Note 2) 18,989 - 18,989 -
-------------------- ------------------- ------------------- --------------------
TOTAL ASSETS 7,211,245 20,574,585 15,961,425 8,451,208
-------------------- ------------------- ------------------- --------------------
LIABILITIES
Payable for investments purchased - 451,055 413,709 431,358
Dividends payable - - - 221
Payable to Investment Adviser - 12,159 4,348 -
Payable to related parties - 13,840 12,625 -
Accrued fees and other liabilities 7,721 23,408 22,381 17,902
-------------------- ------------------- ------------------- --------------------
TOTAL LIABILITIES 7,721 500,462 453,063 449,481
-------------------- ------------------- ------------------- --------------------
NET ASSETS $ 7,203,524 $ 20,074,123 $ 15,508,362 $ 8,001,727
==================== =================== =================== ====================
COMPONENTS OF NET ASSETS
Paid in capital $ 7,012,048 $ 17,438,693 $ 11,739,806 $ 6,850,382
Undistributed net investment income 200,692 136,530 56,577 2,756
Unrealized appreciation (depreciation) on
investments 5,377 2,437,216 3,403,207 915,616
Accumulated net realized gain (loss) from
investments sold (14,593) 61,684 308,772 232,973
-------------------- ------------------- ------------------- --------------------
NET ASSETS $ 7,203,524 $ 20,074,123 $ 15,508,362 $ 8,001,727
==================== =================== =================== ====================
SHARES OF BENEFICIAL INTEREST, NO PAR VALUE 655,625 1,590,986 933,907 564,491
NET ASSET VALUE PER SHARE,
(NET ASSETS DIVIDED BY SHARES OUTSTANDING) $ 10.99 $ 12.62 $ 16.61 $ 14.18
</TABLE>
See Notes to Financial Statements. 2
<PAGE>
NORWEST SELECT FUNDS
STATEMENTS OF OPERATIONS (UNAUDITED) FOR THE SIX MONTHS ENDED JUNE 30, 1997
<TABLE>
<S> <C> <C> <C> <C>
INTERMEDIATE INCOME VALUGROWTH(SM) SMALL COMPANY
BOND EQUITY STOCK STOCK
FUND FUND FUND FUND
-------------------- ------------------- ------------------- --------------------
INVESTMENT INCOME
Interest income $ 220,664 $ 24,543 $ 18,607 $ 12,231
Dividend income - 167,190 88,255 16,692
-------------------- ------------------- ------------------- --------------------
TOTAL INCOME 220,664 191,733 106,862 28,923
-------------------- ------------------- ------------------- --------------------
EXPENSES
Investment advisory (Note 3) 19,555 55,360 50,501 26,232
Administration (Note 3) 6,518 13,840 12,625 6,558
Transfer agency (Note 3) 2,607 5,536 5,050 2,623
Custody (Note 3) 652 1,384 1,263 656
Accounting (Note 3) 28,000 18,000 18,000 23,000
Legal (Note 3) 2,730 5,670 5,143 2,558
Audit 6,324 6,300 5,826 5,259
Trustees fees and expenses 50 98 95 50
Amortization of organization costs (Note 2) 4,954 - 4,954 -
Miscellaneous 2,572 1,726 1,950 1,832
-------------------- ------------------- ------------------- --------------------
TOTAL EXPENSES 73,962 107,914 105,407 68,768
Expenses reimbursed and fees waived (Note 6) (54,412) (52,621) (54,966) (42,569)
-------------------- ------------------- ------------------- --------------------
NET EXPENSES 19,550 55,293 50,441 26,199
-------------------- ------------------- ------------------- --------------------
NET INVESTMENT INCOME 201,114 136,440 56,421 2,724
-------------------- ------------------- ------------------- --------------------
REALIZED AND UNREALIZED GAIN (Loss)
ON INVESTMENTS
Net realized gain (loss) on investments sold (14,431) 61,743 358,492 232,973
Net change in unrealized appreciation
(depreciation) on investments (13,109) 1,937,608 1,469,017 210,735
-------------------- ------------------- ------------------- --------------------
NET REALIZED AND UNREALIZED GAIn (Loss)
ON INVESTMENTS (27,540) 1,999,351 1,827,509 443,708
-------------------- ------------------- ------------------- --------------------
NET INCREASE (DECREASE) IN NET Assets from
OPERATIONS $ 173,574 $ 2,135,791 $ 1,883,930 $ 446,432
==================== =================== =================== ====================
</TABLE>
See Notes to Financial Statements. 3
<PAGE>
NORWEST SELECT FUNDS FOR THE YEAR ENDED DECEMBER 31, 1996
STATEMENTS OF CHANGES AND THE SIX MONTHS ENDED JUNE 30, 1997
<TABLE>
<S> <C> <C> <C> <C> <C>
INTERMEDIATE INCOME VALUGROWTH(SM) SMALL COMPANY
BOND EQUITY STOCK STOCK
FUND FUND(C) FUND FUND
------------ ------------ -------------- -------------
Net ASSETS - DECEMBER 31, 1995 $ 3,089,913 $ - $ 4,793,012 $ 2,027,498
- ------------------------------ ------------ ------------ -------------- -------------
OPERATIONS
Net investment income 261,968 67,055 82,753 6,447
Net realized gain (loss) on investments sold 9,221 5,479 47,040 507,685
Net change in unrealized appreciation on investments (118,049) 499,608 1,317,836 592,999
------------ ------------ -------------- -------------
153,140 572,142 1,447,629 1,107,131
------------ ------------ -------------- -------------
DISTRIBUTION TO SHAREHOLDERS FROM
Net investment income (262,553) (66,965) (82,597) (6,415)
Net realized gain on investments (11,766) (5,538) - (505,292)
------------- ------------ -------------- -------------
(274,319) (72,503) (82,597) (511,707)
------------- ------------ -------------- -------------
CAPITAL SHARE TRANSACTIONS(A)
Sales of shares 3,418,591 8,938,723 4,742,341 3,076,390
Reinvestment of dividends 275,308 73,059 82,886 511,483
Cost of repurchasing shares (703,845) (96,185) (399,886) (120,128)
------------- ------------ -------------- -------------
2,990,054 8,915,597 4,425,341 3,467,745
------------- ------------ -------------- -------------
NET ASSETS - DECEMBER 31, 1996 (INCLUDING LINE I) 5,958,788 9,415,236 10,583,385 6,090,667
- ------------------------------------------------- ------------- ------------ -------------- -------------
OPERATIONS
Net investment income 201,114 136,440 56,421 2,724
Net realized gain (loss) on investments sold (14,431) 61,743 358,492 232,973
Net change in unrealized appreciation (depreciation)
on investments (13,109) 1,937,608 1,469,017 210,735
------------- ------------ -------------- -------------
173,574 2,135,791 1,883,930 446,432
------------- ------------ -------------- -------------
CAPITAL SHARE TRANSACTIONS (B)
Sales of shares 1,528,100 8,642,670 3,247,042 1,607,757
Cost of repurchasing shares (456,938) (119,574) (205,995) (143,129)
------------- ------------ -------------- -------------
1,071,162 8,523,096 3,041,047 1,464,628
------------- ------------ -------------- -------------
NET ASSETS - JUNE 30, 1997 (INCLUDING LINE II)
- ---------------------------------------------
(UNAUDITED) $ 7,203,524 $ 20,074,123 $ 15,508,362 $ 8,001,727
- ------------ ------------- ------------ -------------- -------------
------------- ------------ -------------- -------------
(I) Accumulated undistributed net investment income
(loss) $ (422) $ 90 $ 156 $ 32
------------- ------------ -------------- -------------
------------- ------------ -------------- -------------
(II) Accumulated undistributed net investment income
(loss) $ 200,692 $ 136,530 $ 56,577 $ 2,756
------------- ------------ -------------- -------------
------------- ------------ -------------- -------------
(a) Shares Issued (Redeemed) - December 31, 1996
Sales of shares 313,226 865,655 363,105 241,806
Reinvestment of shares 25,680 6,697 5,772 37,887
Redemption of shares (64,627) (9,655) (30,064) (9,316)
------------- ------------ -------------- -------------
Net increase in shares outstanding 274,279 862,697 338,813 270,377
------------- ------------ -------------- -------------
------------- ------------ -------------- -------------
(b) Shares Issued (Redeemed) - June 30, 1997
Sale of shares 142,177 738,562 210,560 124,532
Redemption of shares (42,372) (10,273) (13,698) (11,276)
------------- ------------ -------------- -------------
Net increase in shares outstanding 99,805 728,289 196,862 113,256
------------- ------------ -------------- -------------
</TABLE>
(c) See Note 1 of Notes to Financial Statements for date of commencement of
operations.
See Notes to Financial Statements. 4
<PAGE>
NORWEST SELECT FUNDS
FINANCIAL HIGHLIGHTS SELECTED DATA FOR A SHARE OUTSTANDING DURING EACH PERIOD
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
INTERMEDIATE INCOME
BOND EQUITY
FUND FUND
--------------------------------------------------- -------------------------
Six Months Six Months
Ended Ended Year Ended
June 30, 1997 Year Ended December 31, June 30, 1997 December 31,
------------------------------------
(Unaudited) 1996 1995 1994 (a) (Unaudited) 1996 (a)
--------------------------------------------------- -------------------------
Net Asset Value, Beginning of Period $ 10.72 $ 10.98 $ 9.95 $ 10.00 $ 10.91 $ 10.00
------------ ---------- ---------- ---------- ------------ ----------
Investment Operations
Net Investment Income (Loss) 0.31 0.50 0.33 0.33 0.09 0.08
Net Realized and Unrealized Gain
(Loss) on Investments (0.04) (0.24) 1.36 (0.38) 1.62 0.92
------------ ---------- ---------- ---------- ------------ ----------
Total from Investment Operations 0.27 0.26 1.69 (0.05) 1.71 1.00
------------ ---------- ---------- ---------- ------------ ----------
Distributions From
Net Investment Income - (0.50) (0.66) - - (0.08)
Net Realized Gain on Investments - (0.02) - - - (0.01)
------------ ---------- ---------- ---------- ------------ ----------
Total Distributions - (0.52) (0.66) - - (0.09)
------------ ---------- ---------- ---------- ------------ ----------
Net Asset Value, End of Period $ 10.99 $ 10.72 $ 10.98 $ 9.95 $ 12.62 $ 10.91
============ ========== ========== ========== ============ ==========
Total Return 2.52%(b) 2.37% 17.08% (0.50)% 15.67%(b) 9.95%
Ratio/Supplementary Data
Net Assets at End of Period (in 000's) $ 7,204 $ 5,959 $ 3,090 $ 1,255 $ 20,074 $ 9,415
Ratios to Average Net Assets:
Expenses including reimbursement/
waiver 0.60%(c) 0.60% 0.60% 0.60%(c) 0.80%(c) 0.80%(c)
Expenses excluding reimbursement/
waiver 2.27%(c) 2.52% 4.67% 9.31%(c) 1.56%(c) 2.51%(c)
Net investment income 6.17%(c) 6.05% 6.33% 6.45%(c) 1.97%(c) 2.31%(c)
Portfolio turnover rate 128.33% 125.23% 54.04% 52.61% 3.30% 4.20%
Average commission rate (d) N/A N/A N/A N/A $ 0.0879 $ 0.0971
</TABLE>
- -----------------------------------
(a) See Note 1 of Notes to Financial Statements for date of commencement of
operations.
(b) Not annualized.
(c) Annualized.
(d) For the fiscal years beginning on or after September 1, 1995, the Fund is
required to disclose average commission per share paid to brokers on the
purchase or sale of equity securities.
See Notes to Financial Statements. 5
<PAGE>
NORWEST SELECT FUNDS
FINANCIAL HIGHLIGHTS (CONCLUDED) SELECTED DATA FOR A SHARE OUTSTANDING DURING
EACH PERIOD
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
VALUGROWTH(SM) SMALL COMPANY
STOCK STOCK
FUND FUND
--------------------------------------------------- --------------------------------------
Six Months Six Months
Ended Ended
June 30, 1997 Year Ended December 31, June 30, 1997 Year Ended December 31,
------------------------------------ -----------------------
(Unaudited) 1996 1995 1994 (a) (Unaudited) 1996 1995 (a)
--------------------------------------------------- ------------ -----------------------
Net Asset Value, Beginning of Period $ 14.36 $ 12.04 $ 9.81 $ 10.00 $ 13.50 $ 11.21 $ 10.00
------------ ---------- ---------- ---------- ------------ ---------- ----------
Investment Operations
Net Investment Income (Loss) 0.06 0.11 0.07 0.07 - 0.02 0.06
Net Realized and Unrealized Gain
(Loss) on Investments 2.19 2.32 2.30 (0.26) 0.68 3.51 1.54
------------ ---------- ---------- ---------- ------------ ---------- ----------
Total from Investment Operations 2.25 2.43 2.37 (0.19) 0.68 3.53 1.60
------------ ---------- ---------- ---------- ------------ ---------- ----------
Distributions From
Net Investment Income - (0.11) (0.14) - - (0.02) (0.06)
Net Realized Gain on Investments - - - - - (1.22) (0.33)
------------ ---------- ---------- ---------- ------------ ---------- ----------
Total Distributions - (0.11) (0.14) - - (1.24) (0.39)
------------ ---------- ---------- ---------- ------------ ---------- ----------
Net Asset Value, End of Period $ 16.61 $ 14.36 $ 12.04 $ 9.81 $ 14.18 $ 13.50 $ 11.21
============ ========== ========== ========== ============ ========== ==========
Total Return 15.67%(b) 20.21% 24.15% (1.09)% 5.04%(b) 31.47% 15.95%
Ratio/Supplementary Data
Net Assets at End of Period (in 000's) $ 15,508 $ 10,583 $ 4,793 $ 1,910 $ 8,002 $ 6,091 $ 2,027
Ratio to Average Net Assets:
Expenses including reimbursement/
waiver 0.80%(c) 0.80% 8.00% 0.80%(c) 0.80%(c) 0.80% 0.80%(c)
Expenses excluding reimbursement/
waiver 1.67%(c) 2.02% 3.81% 8.00%(c) 2.10%(c) 2.82% 5.38%(c)
Net investment income 0.89%(c) 1.08% 1.24% 1.67%(c) 0.08%(c) 0.16% 1.02%(c)
Portfolio turnover rate 22.77% 37.57% 25.44% 16.77% 107.17% 194.87% 51.16%
Average commission rate (d) $ 0.0779 $ 0.0847 N/A N/A $ 0.0561 $ 0.0590 N/A
</TABLE>
- -----------------------------------
(a) See Note 1 of Notes to Financial Statements for date of commencement of
operations.
(b) Not annualized.
(c) Annualized.
(d) For the fiscal years beginning on or after September 1, 1995, the Fund is
required to disclose average commission per share paid to brokers on the
purchase or sale of equity securities.
See Notes to Financial Statements. 6
<PAGE>
NORWEST SELECT FUNDS
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) JUNE 30, 1997
NOTE 1. ORGANIZATION
Norwest Select Funds (the "Trust") was organized as a Delaware business trust on
December 7, 1993 and is registered as an open-end management investment company
under the Investment Company Act of 1940. The Trust currently has four
diversified investment portfolios (each, a "Fund" and collectively, the
"Funds"). Intermediate Bond Fund and ValuGrowthSM Stock Fund commenced
operations on June 1, 1994. Small Company Stock Fund commenced operations on May
1, 1995. Income Equity Fund commenced operations on May 6, 1996.
Shares of the Trust's Funds may be sold only to separate accounts of insurance
companies to serve as an investment medium for variable life insurance policies
and variable annuity contracts issued by the insurance companies.
The Trust Instrument authorizes the issuance of an unlimited number of shares of
beneficial interest without par value.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
These financial statements are prepared in accordance with generally accepted
accounting principles, which require management to make estimates and
assumptions that affect the reported amounts of assets and liabilities,
disclosure of contingent assets and liabilities at the date of the financial
statements, and the reported amounts of increase and decrease in net assets from
operations during the fiscal period. Actual results could differ from those
estimates.
The following represents significant accounting policies of the Fund:
SECURITY VALUATION - Securities purchased that mature in 60 days or less are
valued at amortized cost. Securities for which market quotations are readily
available are valued using the last reported sales price provided by independent
pricing services. If no sales are reported, the mean of the last bid and asked
price is used. Fixed-income securities and other securities traded on an
exchange for which market quotations are readily available are valued at the
mean of the last bid and asked price provided by independent pricing services.
If no mean price is available, the last bid price is used. In the absence of
readily available market quotations, securities are valued at fair value
determined in accordance with procedures adopted by the Board of Trustees.
INVESTMENT INCOME - Dividend income is recorded on the ex-dividend date.
Interest income is recorded on an accrual basis.
PREMIUM AMORTIZATION AND DISCOUNT ACCRETION - Fixed-income investments with a
maturity greater than sixty days and purchased at a premium or discount (other
than original issue discount) are amortized or accreted over the life of the
respective securities.
DISTRIBUTIONS TO SHAREHOLDERS - Dividends from net investment income and capital
gain distributions, if any, are distributed to shareholders at least annually.
Distributions are based on amounts calculated in accordance with applicable
federal income tax regulations.
FEDERAL TAXES - The Fund intends to qualify and continue to qualify each year as
a regulated investment company and distribute all of its taxable income. In
addition, by distributing in each calendar year substantially all of its net
investment income, capital gain and certain other amounts, if any, the Fund will
not be subject to a federal excise tax. Therefore, no federal income or excise
tax provision is required.
EXPENSE ALLOCATION - The Trust accounts separately for the assets and
liabilities and operation of each Fund. Expenses that are directly attributable
to more than one Fund are allocated among the respective Funds.
REALIZED GAIN AND LOSS - Security transactions are recorded on a trade date
basis. Realized gain and loss on investments sold are recorded on the basis of
identified cost.
REPURCHASE AGREEMENTS - Each Fund along with certain other Norwest Advantage
Funds may transfer uninvested cash balances into a joint trading account. These
balances are invested in one or more repurchase agreements. The Funds, through
their custodian, receive delivery of the collateral, whose market value must
always equal or exceed the repurchase price. The investment adviser is
responsible for determining the value of the collateral at all times. In the
event of default, a Fund may have difficulties with the disposition of such
collateral.
ORGANIZATIONAL COSTS - The costs incurred by certain Funds in connection with
their organization and registration of shares have been capitalized and are
being amortized using the straight line method over a five-year period beginning
with the commencement of the respective Fund's operations.
3. ADVISORY, SERVICING FEES AND OTHER TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISER - The investment adviser of each Fund is Norwest Investment
Management, Inc. ("Adviser"), a part of the Norwest Bank ("the Bank"), which is
a subsidiary of Norwest Corporation. The Adviser receives an annual advisory fee
from each Fund based on a percentage of average daily net assets of the
respective Fund at the following annual rates: Intermediate Bond Fund - 0.60%;
Income Equity Fund, ValuGrowthSM Stock Fund, and Small Company Stock fund -
0.80%.
7
<PAGE>
NORWEST SELECT FUNDS
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)(CONTINUED) JUNE 30, 1997
3. ADVISORY, SERVICING FEES AND OTHER TRANSACTIONS WITH AFFILIATES (CONTINUED)
MANAGER AND OTHER SERVICES - As manager of the Trust, Forum Administrative
Services, Limited Liability Company ("Forum"), a registered broker-dealer, is
entitled to receive a management fee of 0.20% of the average daily net assets of
each Fund. In addition, for the period ended June 30,1997, Forum charged the
Trust legal expenses aggregating $4,899.
Forum Financial Corp. ("FFC"), an affiliate of Forum, provides fund accounting
services to the Funds. For these services, FFC is entitled to receive a fee of
$36,000 per year per Fund plus certain amounts based upon the number of classes
of fund shares and number and types of portfolio transactions within each Fund.
The Bank serves as the Trust's transfer agent, dividend disbursing agent and
custodian. For these services the Bank is entitled to receive a fee at an annual
rate of 0.10% of the average daily net assets attributable to each Fund.
NOTE 4. SECURITIES TRANSACTIONS
The cost of securities purchased and the proceeds from sales of securities
(excluding short term securities) for the six months ended June 30, 1997 were as
follows:
<TABLE>
<S> <C> <C>
FUND COST OF PURCHASES PROCEEDS FROM SALES
---- ----------------- -------------------
Intermediate Bond Fund $9,568,932 $8,118,317
Income Equity Fund 9,164,711 397,289
ValuGrowthSM Stock Fund 5,404,633 2,726,417
Small Company Stock Fund 8,219,906 6,735,269
</TABLE>
For federal income tax purposes, the tax basis of investment securities owned
and the aggregate gross unrealized appreciation and the aggregate gross
unrealized depreciation as of June 30, 1997 were as follows:
<TABLE>
<S> <C> <C> <C> <C>
UNREALIZED UNREALIZED NET
FUND APPRECIATION DEPRECIATION APPRECIATION TAX COST
---- ------------ ------------ ------------ --------
Intermediate Bond Fund $ 41,890 $ 36,513 $ 5,377 $ 7,055,578
Income Equity Fund 2,632,310 195,094 2,437,216 17,982,955
ValuGrowthSM Stock Fund 3,606,705 203,498 3,403,207 12,219,367
Small Company Stock Fund 1,098,373 182,757 915,616 7,273,941
</TABLE>
NOTE 5. FEDERAL INCOME TAX
As of June 30, 1997, ValuGrowthSM Stock Fund had capital loss carryovers
available to offset future capital gains as follows:
CARRYOVER AMOUNT YEAR OF EXPIRATION
--------------- ------------------
$ 38,217 2003
NOTE 6. VOLUNTARY WAIVERS AND REIMBURSEMENTS
For the six months ended June 30, 1997, the Trust's service providers
voluntarily waived and/or reimbursed certain fees or expenses incurred by the
Funds.
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
EXPENSES
FEES WAIVED REIMBURSED TOTAL
---------------------------------------------------- ---------- ------
CUSTODIAN AND
FUND TRANSFER AGENT ADVISER FORUM FFC FORUM
---- ------------- ------- ----- --- -----
Intermediate Bond Fund $3,259 $19,555 $6,519 $10,500 $14,579 $54,412
Income Equity Fund 6,920 43,201 - 2,500 - 56,621
ValuGrowthSM Stock Fund 6,313 46,153 - 2,500 - 54,966
Small Company Stock Fund 3,279 26,232 6,558 6,500 - 42,569
</TABLE>
8
<PAGE>
NORWEST SELECT FUNDS
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)(CONCLUDED) JUNE 30, 1997
NOTE 7. PROXY VOTE
The following shows the votes of shareholders of Norwest Select Funds at the
shareholders' meeting held on May 23, 1997.
PROPOSAL 1. ELECTION OF TRUSTEES. (FOR SHAREHOLDERS OF ALL FUNDS)
Each trustee or nominee was elected by shareholders. The vote is listed below.
<TABLE>
<S> <C> <C>
FOR WITHHELD
--- --------
Robert C. Brown...................................... 2,854,167 24,042
Donald Burkhardt..................................... 2,854,167 24,042
James C. Harris...................................... 2,854,167 24,042
John Y. Keffer....................................... 2,854,167 24,042
Richard M. Leach..................................... 2,854,167 24,042
John S. McCune....................................... 2,854,167 24,042
Timothy J. Penny..................................... 2,854,167 24,042
Donald Willeke....................................... 2,854,167 24,042
</TABLE>
PROPOSAL 2. RATIFICATION OF THE SELECTION OF KPMG PEAT MARWICK LLP AS
INDEPENDENT AUDITORS. (FOR SHAREHOLDERS OF ALL FUNDS)
<TABLE>
<S> <C> <C> <C>
FOR AGAINST ABSTAIN
--- ------- -------
Total................................................ 2,812,564 11,229 54,265
PROPOSAL 3. INVESTMENT OBJECTIVE.
To approve an amendment to each of the following Fund's investment objective.
FOR AGAINST ABSTAIN
--- ------- -------
Income Equity Fund................................... 959,863 12,023 55,695
ValuGrowth(SM) Stock Fund............................ 739,152 4,329 55,695
</TABLE>
9
<PAGE>
NORWEST SELECT FUNDS
SCHEDULES OF INVESTMENTS (UNAUDITED) JUNE 30, 1997
<TABLE>
<S> <C> <C> <C>
INTERMEDIATE BOND FUND
Face/Share
Amount Value
- --------------- ------------------
ASSET BACKED SECURITIES (6.9%)
200,000 Mid-State Trust VI, Series 1 A1, 7.34%, 7/1/35 $ 200,688
290,000 PBS Lending, Series 1997-2 A5, 7.63%, 11/20/23 287,190
------------------
TOTAL ASSET BACKED SECURITIES (COST $489,763) 487,878
------------------
COLLATERALIZED MORTGAGE OBLIGATIONS (4.0%)
278,050 AMBS, Series AS 1008 1 7.54%, 1/25/12
(COST $279,651) 284,827
------------------
CORPORATE BONDS & NOTES (26.5%)
200,000 AMBAC, Inc., 9.38%, 8/1/11 238,074
200,000 American Home Products Corp., 7.25%, 3/1/23 197,448
200,000 Atlantic Richfield Co., 9.00%, 4/1/21 234,744
200,000 Consolidated Natural Gas Co., 6.69%, 12/1/08 194,460
300,000 Ford Motor Co., 9.50%, 9/15/11 357,981
185,000 General Electric Capital Corp., 7.88%, 12/1/06 197,185
150,000 International Lease Finance Corp., 6.50%, 7/15/97 150,053
100,000 Philip Morris Cos., Inc., 9.00%, 5/15/98 102,280
200,000 Swiss Bank Corp., 7.50%, 7/15/25 199,040
------------------
TOTAL CORPORATE BONDS & NOTES (COST $1,895,593) 1,871,265
------------------
MORTGAGE BACKED SECURITIES (25.6%)
FEDERAL HOME LOAN MORTGAGE CORPORATION (10.8%)
493,915 Gold Pool C00492, 7.50%, 1/1/27 496,232
276,499 Gold Pool FGD70924, 6.50%, 5/1/26 265,525
------------------
TOTAL FEDERAL HOME LOAN MORTGAGE CORPORATION (COST $760,213) 761,757
------------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION (2.7%)
194,722 Pool 73932, 6.84%, 1/1/07 (COST $191,891) 193,260
------------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (12.1%)
242,629 Pool 405481, 8.50%, 8/15/25 252,791
294,347 Pool 421752, 8.00%, 7/15/26 301,523
298,863 Pool 445071, 7.50%, 1/15/27 300,077
------------------
TOTAL GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (COST $844,200) 854,391
------------------
TOTAL MORTGAGE BACKED SECURITIES (COST $1,796,304) 1,809,408
------------------
RECEIVABLES BACKED SECURITIES (3.6%)
250,000 AmeriCredit Corp., Series B A3, 6.67%, 2/12/03
(COST $249,946) 250,508
------------------
</TABLE>
See Notes to Financial Statements. 10
<PAGE>
NORWEST SELECT FUNDS
SCHEDULES OF INVESTMENTS (UNAUDITED)(CONTINUED) JUNE 30, 1997
INTERMEDIATE BOND FUND (CONCLUDED)
<TABLE>
<S> <C> <C> <C>
Face/Share
Amount Value
- --------------- ------------------
U.S. TREASURY OBLIGATIONS (31.0%)
U.S. TREASURY NOTES (29.6%)
100,000 5.88%, 8/15/98 $ 99,987
400,000 6.00%, 8/15/99 399,104
100,000 6.13%, 8/15/99 100,283
300,000 8.88%, 11/15/98 311,277
600,000 6.25%, 3/31/99 602,178
275,000 6.38%, 3/31/01 275,462
200,000 6.25%, 1/31/02 198,968
100,000 6.63%, 3/31/02 100,895
------------------
TOTAL U.S. TREASURY NOTES (COST $2,080,096) 2,088,154
------------------
U.S. TREASURY BONDS (1.4%)
100,000 6.63%, 2/15/27 (COST $96,203) 97,893
------------------
TOTAL U.S. TREASURY OBLIGATIONS (COST $2,173,299) 2,186,047
------------------
SHORT-TERM HOLDINGS (2.4%)
171,022 Dreyfus Cash Management Fund
(COST $171,022) 171,022
------------------
TOTAL INVESTMENTS (100.0%) (COST $7,055,578) $ 7,060,955
==================
</TABLE>
- -------------------------------
AMBAC American Municipal Bond Assurance
AMBS Agriculture Mortgage Backed Securities
FHLMC Federal Home Loan Mortgage Corporation
FNMA Federal National Mortgage Association
GNMA Government National Mortgage Association
See Notes to Financial Statements. 11
<PAGE>
NORWEST SELECT FUNDS
SCHEDULES OF INVESTMENTS (UNAUDITED)(CONTINUED) JUNE 30, 1997
<TABLE>
<S> <C> <C>
INCOME EQUITY FUND
Face/Share
Amount Value
- --------------- ------------------
COMMON STOCK (95.2%)
BASIC MATERIALS (6.3%)
10,790 Du Pont (E.I.) De Nemours $ 678,305
7,770 Morton International, Inc. 234,555
3,190 Pfizer, Inc. 381,205
------------------
1,294,065
------------------
CAPITAL GOODS (9.0%)
12,940 AMP, Inc. 540,247
6,930 Emerson Electric Co. 381,591
7,230 General Electric Co. 472,668
5,910 Honeywell, Inc. 448,423
------------------
1,842,929
------------------
CONSUMER CYCLICAL (10.9%)
5,955 Dayton Hudson Corp. 316,737
9,490 Deluxe Corp. 323,855
5,155 Eastman Kodak Co. 395,648
8,615 J.C. Penney Co., Inc. 449,601
10,385 May Department Stores Co. 490,694
4,600 Sears, Roebuck and Co. 247,254
------------------
2,223,789
------------------
CONSUMER STAPLES (19.0%)
5,310 American Home Products Corp. 406,216
11,300 Fortune Brands, Inc. 421,639
6,350 Johnson & Johnson 408,789
7,480 McDonald's Corp. 361,379
3,800 Merck & Co., Inc. 393,300
10,590 PepsiCo, Inc. 397,787
10,060 Philip Morris Cos., Inc. 446,417
3,655 Procter & Gamble Co. 516,272
12,585 Sara Lee Corp. 523,853
------------------
3,875,652
------------------
ENERGY (11.5%)
6,250 Atlantic Richfield Co. 440,625
5,445 Chevron Corp. 402,595
6,700 Exxon Corp. 412,050
4,360 Mobil Corp. 304,656
6,360 Royal Dutch Petroleum Co., ADR 345,826
3,520 Schlumberger, Ltd. 440,000
------------------
2,345,752
------------------
FINANCIAL (11.0%)
5,360 American Express Co. 399,321
8,660 American General Corp. 413,518
4,710 First Bank System, Inc. 402,118
</TABLE>
See Notes to Financial Statements. 12
<PAGE>
NORWEST SELECT FUNDS
SCHEDULES OF INVESTMENTS (UNAUDITED)(CONTINUED) JUNE 30, 1997
INCOME EQUITY FUND (CONCLUDED)
<TABLE>
<S> <C> <C>
Face/Share
Amount Value
- --------------- ------------------
FINANCIAL (CONTINUED)
4,375 J.P. Morgan & Co., Inc. $ 456,643
6,220 Transamerica Corp. 581,962
------------------
2,253,562
------------------
MISCELLANEOUS (8.2%)
7,810 Cognizant Corp. 316,305
21,940 Dun & Bradstreet Corp. 575,925
10,770 Gallaher Group Plc (a) 198,580
5,680 Minnesota Mining & Manufacturing Co. 579,360
------------------
1,670,170
------------------
TECHNOLOGY (3.0%)
10,850 Hewlett-Packard Co. 607,600
------------------
TRANSPORTATION AND PROFESSIONAL SERVICES (1.8%)
4,470 United Technologies Corp. 371,010
------------------
UTILITIES AND TELECOMMUNICATIONS (14.5%)
13,325 AT & T Corp. 467,209
7,670 Consolidated Natural Gas Co. 412,746
4,040 FPL Group, Inc. 186,092
10,420 GTE Corp. 457,186
4,090 Lucent Technologies, Inc. 304,103
9,320 Pacific Gas & Electric Co. 226,016
8,050 Public Service Enterprise Group, Inc. 201,250
7,470 Texas Utilities Co. 257,245
13,800 Waste Management, Inc. 443,327
------------------
2,955,174
------------------
TOTAL COMMON STOCK (COST $17,002,487) 19,439,703
------------------
REPURCHASE AGREEMENTS (4.8%)
980,468 Lehman Brothers, Inc., 6.05%, 7/1/97, to be
repurchased at $980,633, (Collateralized by Federal National
Mortgage Association Discount Notes, 0.00%, 7/8/97 - 10/10/97,
Par $56,415,000; Federal Home Loan Discount Notes, 0.00%,
10/8/97 - 10/22/97, Par $48,000,000; Federal Farm Credit Bank,
5.45%, 3/3/98, Par $20,180,000) (COST $980,468) 980,468
------------------
TOTAL INVESTMENTS (100.0%) (COST $17,982,955) $ 20,420,171
==================
</TABLE>
- -------------------------------
(a) Non income producing securities
ADR - American Depositary Receipts
See Notes to Financial Statements. 13
<PAGE>
NORWEST SELECT FUNDS
SCHEDULES OF INVESTMENTS (UNAUDITED)(CONTINUED) JUNE 30, 1997
VALUGROWTH(SM) STOCK FUND
<TABLE>
<S> <C> <C>
Face/Share
Amount Value
- --------------- ------------------
COMMON STOCK (94.1%)
BASIC MATERIALS (5.7%)
5,200 Du Pont (E.I.) De Nemours $ 326,950
6,800 Millipore Corp. 299,200
6,100 Monsanto Co. 262,618
------------------
888,768
------------------
CAPITAL GOODS (6.5%)
4,500 Emerson Electric Co. 247,786
4,000 General Electric Co. 261,500
3,200 Honeywell, Inc. 242,804
7,850 Thermo Electron Corp.(a) 269,846
------------------
1,021,936
------------------
CONSUMER CYCLICAL (8.4%)
6,000 Black & Decker Corp. 223,126
4,000 May Department Stores Co. 189,000
7,800 Newell Co. 309,080
5,500 Sears, Roebuck and Co. 295,625
3,600 Walt Disney Co. 288,088
------------------
1,304,919
------------------
CONSUMER STAPLES (21.0%)
3,700 American Home Products Corp. 283,050
5,400 Baxter International, Inc. 282,150
3,400 Coca-Cola Co. 229,500
2,284 Gillette Co. 216,410
9,600 Ikon Office Solutions, Inc. 239,406
4,600 Johnson & Johnson 296,126
5,700 Kimberly-Clark Corp. 283,575
3,600 Medtronic, Inc. 291,600
3,200 Merck & Co., Inc. 330,917
6,000 PepsiCo, Inc. 225,376
2,100 Procter & Gamble Co. 296,474
7,300 Vencor, Inc.(a) 308,425
------------------
3,283,009
------------------
ENERGY (6.7%)
3,400 Chevron Corp. 251,392
3,000 Mobil Corp. 209,625
5,400 Royal Dutch Petroleum Co., ADR 293,488
2,300 Schlumberger, Ltd. 287,723
------------------
1,042,228
------------------
</TABLE>
See Notes to Financial Statements. 14
<PAGE>
NORWEST SELECT FUNDS
SCHEDULES OF INVESTMENTS (UNAUDITED)(CONTINUED) JUNE 30, 1997
VALUGROWTH(SM) STOCK FUND (CONTINUED)
<TABLE>
<S> <C> <C>
Face/Share
Amount Value
- --------------- ------------------
FINANCIAL (17.7%)
1,900 American International Group, Inc. $ 283,814
4,400 BankAmerica Corp. 284,077
8,700 Beacon Properties Corp. 290,362
4,300 Chubb Corp. 287,564
2,300 Citicorp 277,294
3,000 First Union Corp. 277,500
6,500 FNMA 283,564
3,750 Franklin Resources, Inc. 272,109
6,100 State Street Corp. 282,125
4,550 SunAmerica, Inc. 221,813
------------------
2,760,222
------------------
MISCELLANEOUS (1.0%)
7,700 Gentex Corp.(a) 152,075
------------------
TECHNOLOGY (15.4%)
10,600 American Power Conversion Corp.(a) 201,400
5,900 Cabletron Systems, Inc.(a) 167,045
3,450 Cisco Systems, Inc.(a) 231,583
4,900 EMC Corp.(a) 191,100
6,600 First Data Corp. 289,993
3,000 Intel Corp. 425,439
2,200 Microsoft Corp.(a) 279,607
4,500 Philips Electronics N.V. 323,438
3,900 Xerox Corp. 307,617
------------------
2,417,222
------------------
TRANSPORTATION AND PROFESSIONAL SERVICES (3.6%)
4,600 Fluor Corp. 253,863
8,100 USA Waste Services, Inc.(a) 312,865
------------------
566,728
------------------
UTILITIES AND TELECOMMUNICATIONS (8.1%)
5,000 Consolidated Natural Gas Co. 269,065
5,980 GTE Corp. 262,374
3,600 SBC Communications, Inc. 222,751
6,700 Telfonakriebolaget LM Ericsson, Series B ADR 263,815
7,100 Texas Utilities Co. 244,507
------------------
1,262,512
------------------
TOTAL COMMON STOCK (COST $11,296,412) 14,699,619
------------------
</TABLE>
See Notes to Financial Statements. 15
<PAGE>
NORWEST SELECT FUNDS
SCHEDULES OF INVESTMENTS (UNAUDITED)(CONTINUED) JUNE 30, 1997
VALUGROWTH(SM) STOCK FUND (CONCLUDED)
<TABLE>
<S> <C> <C>
Face/Share
Amount Value
- --------------- ------------------
SHORT-TERM HOLDINGS (5.9%)
458,457 Dreyfus Cash Management fund $ 458,457
464,498 Provident Institutional Funds 464,498
------------------
TOTAL SHORT-TERM HOLDINGS (COST $922,955) 922,955
------------------
TOTAL INVESTMENTS (100.0%) (COST $12,219,367) $ 15,622,574
==================
</TABLE>
- -------------------------------
(a) Non income producing security
ADR - American Depositary Receipts
See Notes to Financial Statements. 16
<PAGE>
NORWEST SELECT FUNDS
SCHEDULES OF INVESTMENTS (UNAUDITED)(CONTINUED) JUNE 30, 1997
SMALL COMPANY STOCK FUND
<TABLE>
<S> <C> <C>
Face/Share
Amount Value
- --------------- ------------------
COMMON STOCK (93.3%)
CAPITAL GOODS (17.1%)
2,775 Altron, Inc.(a) $ 41,625
6,100 OEA, Inc. 240,783
2,775 Plexus Corp.(a) 153,106
4,825 RMI Titanium Co.(a) 131,196
6,000 Speedfam International, Inc.(a) 215,252
6,100 STB Systems, Inc.(a) 199,741
5,200 Titanium Metals Corp.(a) 164,039
2,675 Veeco Instruments, Inc.(a) 103,489
4,700 Vitesse Semiconductor Corp.(a) 153,632
------------------
1,402,863
------------------
CONSUMER CYCLICAL (6.8%)
6,025 ACNielson Corp.(a) 118,241
3,650 Hirsch International Corp.(a) 81,213
5,400 Inacom Corp.(a) 168,002
1,500 Keystone Automotive Industries, Inc.(a) 25,500
5,200 Racing Champions Corp.(a) 80,502
3,300 Service Experts, Inc.(a) 80,850
------------------
554,308
------------------
CONSUMER STAPLES (13.4%)
3,100 Arrow International, Inc. 90,655
5,875 Canadaigua Wine Co., Inc.(a) 199,750
8,225 FPA Medical Management, Inc.(a) 194,829
7,775 HCIA, Inc.(a) 259,258
2,125 Lifecore Biomedical, Inc.(a) 29,219
2,450 OM Group, Inc. 81,156
3,200 Spine-Tech, Inc.(a) 118,802
5,125 VISX, Inc.(a) 121,337
------------------
1,095,006
------------------
ENERGY (14.9%)
32,650 Abacan Resource Corp.(a) 104,073
2,375 Atwood Oceanics, Inc.(a) 159,038
4,475 Cabot Oil and Gas Corp. 78,873
3,225 Devon Energy Corp. 118,519
8,075 FX Energy Corp.(a) 65,710
3,750 KCS Energy, Inc. 76,408
10,450 Marine Drilling Co., Inc.(a) 204,820
2,900 Nuevo Energy Co.(a) 118,900
3,450 Ocean Energy, Inc.(a) 159,500
4,475 Vintage Petroleum, Inc. 137,606
------------------
1,223,447
------------------
FINANCIAL (13.8%)
1,700 Coast Savings Financial(a) 77,246
4,825 Commonwealth Bankcorp, Inc. 79,010
</TABLE>
See Notes to Financial Statements. 17
<PAGE>
NORWEST SELECT FUNDS
SCHEDULES OF INVESTMENTS (UNAUDITED)(CONTINUED) JUNE 30, 1997
SMALL COMPANY STOCK FUND (CONTINUED)
<TABLE>
<S> <C> <C>
Face/Share
Amount Value
- --------------- ------------------
FINANCIAL (CONTINUED)
4,175 Haven Bancorp, Inc. $ 156,564
4,025 HealthCare Financial Partners, Inc.(a) 82,010
9,775 Imperial Credit Industries, Inc.(a) 200,999
6,400 Medallion Financial Corp. 122,402
4,500 Peoples Bancorp, Inc. 86,064
6,450 Peoples Bank 166,933
1,425 Redwood Trust, Inc. 66,619
5,275 Southern Pacific Funding Corp.(a) 87,698
------------------
1,125,545
------------------
NON-DURABLE GOODS (1.0%)
3,850 United Natural Foods, Inc.(a) 80,875
------------------
TECHNOLOGY (22.9%)
10,500 Accelr8 Technology Corp.(a) 156,189
1,650 Arterial Vascular Engineering, Inc.(a) 53,110
3,975 Bell & Howell Co.(a) 122,480
12,150 Cellular Technical Services Co.(a) 111,256
2,375 CFM Technologies, Inc.(a) 77,782
4,850 Ciber, Inc.(a) 165,810
2,300 Computer Horizons Corp.(a) 78,364
3,450 Computer Task Group, Inc. 128,513
4,120 ETEC Systems, Inc.(a) 176,645
3,575 IKOS Systems, Inc.(a) 76,567
1,800 Keane, Inc. 93,622
3,925 Metro Information Services, Inc.(a) 77,521
825 Powerwave Technologies, Inc. 18,150
5,600 SEEC, Inc.(a) 107,035
7,675 Tetra Technologies, Inc.(a) 189,807
8,000 Zygo Corp.(a) 246,002
------------------
1,878,853
------------------
TRANSPORTATION AND PROFESSIONAL SERVICES (1.0%)
5,100 Covenant Transportation, Inc.(a) 83,514
------------------
UTILITIES AND TELECOMMUNICATIONS (2.4%)
6,337 CellStar Corp.(a) 194,086
------------------
TOTAL COMMON STOCK (COST $6,722,881) 7,638,497
------------------
</TABLE>
See Notes to Financial Statements. 18
<PAGE>
NORWEST SELECT FUNDS
SCHEDULES OF INVESTMENTS (UNAUDITED)(CONCLUDED) JUNE 30, 1997
SMALL COMPANY STOCK FUND (CONCLUDED)
<TABLE>
<S> <C> <C>
Face/Share
Amount Value
- --------------- ------------------
SHORT-TERM HOLDINGS (6.7%)
199,961 Dreyfus Cash Management Fund $ 199,961
80,509 Federated U.S. Government Fund 80,509
139,669 Fidelity Money Market Fund 139,669
130,921 Provident Institutional Fund, Fed Funds 130,921
------------------
TOTAL SHORT-TERM HOLDINGS (COST $551,060) 551,060
------------------
TOTAL INVESTMENTS (100.0%) (COST $7,273,941) $ 8,189,557
==================
</TABLE>
- -------------------------------
(a) Non income producing securities
See Notes to Financial Statements. 19
<PAGE>
[Norwest Passage Logo]
Norwest Select Funds
Shareholders Services
Minneapolis/St. Paul 667-8833
Elsewhere 800-338-1348
Norwest Investment Management, Inc.
Investment Adviser
Norwest Bank Minnesota, N.A.
Transfer Agent
Custodian
Forum Financial Services, Inc.
Distributor
(C)1997 Norwest Select Funds This report is authorized for distribution only
PVBAA 085 8/97 to shareholders and to holders of variable
annuity contracts of Norwest Passage Variable
Annuity. If it is delivered to other than a
current shareholder or contract holder, then it
must be accompanied by prospectuses for the
Norwest Select Funds and the Norwest Passage
Variable Annuity.
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