<PAGE> 1
LEADER MUTUAL FUNDS
LETTER TO SHAREHOLDERS
August 31, 2000
Dear Shareholders:
We are pleased to provide you with this annual report for the LEADER Mutual
Funds. Inside you will find a review of your fund's strategy and performance for
the periods ended August 31, 2000.
In addition, we would like to share with you some exciting changes to our fund
family.
NEW NAME
On September 1, 2000, the MAGNA Funds will be known as the LEADER Mutual Funds.
The same investment professionals associated with MAGNA Funds will continue to
manage the LEADER Mutual Funds. Furthermore, the funds' investment objectives
will not change. The LEADER Mutual Funds will continue to take a disciplined,
long-term approach to investing.
Along with the name change, we are introducing a new share class -- the
Institutional share class. As of September 1, 2000, we automatically will
convert your existing "A" shares into the new LEADER Funds Institutional share
class. The "A" share class soon will be subject to annual 12b-1 marketing fees,
but the Institutional share class will not. So, by converting your shares from
the "A" class to the Institutional class, we are keeping your account free from
12b-1 fees. The conversion will not affect the investments in your account, and
it will not change the fee structure currently associated with your account.
NEW FUNDS
On July 24, 2000, we launched the Tax-Exempt Bond Fund, designed for investors
seeking current income that is exempt from federal income tax. The fund
generally invests in investment-grade bonds, notes and commercial paper issued
by states, cities and other local governments. The fund maintains a weighted
average maturity between five and twenty years.
Effective September 1, 2000, we will offer two new money market funds -- the
LEADER Tax-Exempt Money Market Fund and the LEADER Treasury Money Market Fund.
The LEADER Tax-Exempt Money Market Fund seeks maximum current income exempt from
federal income tax consistent with preservation of capital and liquidity. The
LEADER Treasury Money Market Fund strives for a high level of current income
consistent with stability of principal and liquidity.
If you have any questions about the name change, new share class or new funds,
please call us at 1-800-219-4182. We appreciate your ongoing support, and we
look forward to continuing to grow and strengthen our mutual fund family and to
helping you meet your investment goals.
Sincerely,
Walter B. Grimm
Walter B. Grimm
President
An investment in the fund is neither insured nor guaranteed by the FDIC or any
other government agency. Although the fund strives to maintain the value of your
investment at $1.00 per share, it is possible to lose money by investing the
fund. The fund's income may be subject to certain state and local taxes and
depending on your tax status, the federal alternative minimum tax.
<PAGE> 2
LEADER GROWTH & INCOME FUND
PORTFOLIO MANAGER REPORT
COMMENTS FROM DISCUSSIONS WITH GARY J. GUTHRIE, PORTFOLIO MANAGER
How has the Fund performed over the past one-year period?
The Fund has a total return of 16.80%, exclusive of sales load for the one-year
ended August 31, 2000.(1) This compares with the S&P 500 Index returns of 16.32%
for the period.
What is the composition of the portfolio at this time?
The Fund is currently invested in 77 companies, which represent 29 industries.
We are broadly diversified with the single largest equity holding at 6.3% of the
portfolio while the ten largest positions represent 34.3% of the portfolio as of
August 31, 2000.(2)
What comments do you have on the market and Fund performance?
Technology and Healthcare sectors of the Fund continue to provide the core
emphasis. The strong dollar has depressed overseas earnings of consumer product
companies. The Fed's last decision to hold rates at current levels bolstered
market confidence. Consumer prices advanced modestly and fear of rising wages
seem overblown as productivity gains continue.
What is your outlook for the next six months?
Concerns over higher oil prices and the impact of a slowing economy on earnings
overshadows the near term outlook. With election year rhetoric in full swing,
proposals to expand Medicare coverage to prescription drugs will continue to be
debated.
The opportunities for long-term growth remain for investors with discipline and
patience.
---------------
(1) With a maximum sales charge of 4.00%, the total return for the fiscal year
ended August 31, 2000 would have been 12.12%.
(2) Portfolio holdings are subject to change.
2
<PAGE> 3
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
IN THE LEADER GROWTH & INCOME FUND,
THE S&P 500 STOCK INDEX AND THE
LIPPER GROWTH & INCOME FUND INDEX
<TABLE>
<S> <C> <C>
LEADER Growth & Income Fund S&P 500 Stock Index
8/31/94 9601 10000
8/31/95 10979 10850
8/31/96 13041 11368
8/31/97 18205 12233
8/31/98 19814 13508
8/31/99 26495 13962
8/31/00 30948 35654
<S> <C>
Lipper Growth & Income Fund
8/31/94 10000
8/31/95 11325
8/31/96 11623
8/31/97 12864
8/31/98 15882
8/31/99 15885
8/31/00 25697
</TABLE>
COMPARATIVE TOTAL RETURN
for the periods ended August 31, 2000
<TABLE>
<CAPTION>
Since
2000 One Five Inception
YTD Year Year (8/31/94)
--------------------------------
<S> <C> <C> <C> <C>
LEADER Growth &
Income Fund
Without sales charge..... 5.53% 16.80% 23.03% 21.54%
With sales charge*....... 1.30% 12.12% 22.02% 20.72%
</TABLE>
* Reflects maximum sales charge of 4.00%.
PAST PERFORMANCE IS NOT PREDICTIVE OF
FUTURE RESULTS.
The performance of the LEADER
Growth & Income Fund is measured
against the Standard & Poor's 500
Index and the Lipper Growth &
Income Fund Index. The S&P 500 is
generally representative of the
performance of the domestic large
capitalization stock universe.
The index does not reflect the
deduction of expenses associated
with a mutual fund, such as
investment management and fund
accounting fees. However, the
Lipper Growth & Income Fund
Index, a managed index, and the
Fund's performance does reflect
the deduction of fees for these
value-added services. The Fund's
total returns would have been
lower had certain fees not been
waived during the periods shown.
Investment return and NAV will
fluctuate, so that an investor's
shares, when redeemed, may be
worth more or less than the
original cost.
SECTOR WEIGHTINGS*
AS OF 8/31/00
<TABLE>
<CAPTION>
BASIC CONSUMER HEALTH COMMUNICATIONS CONSUMER
CAPITAL GOODS MATERIALS CYCLICALS TECHNOLOGY CARE SERVICES STAPLES ENERGY TRANSPORTATION
------------- --------- --------- ---------- ------ -------------- -------- ------ --------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
4.4 4.2 4.1 33.6 14 5.7 6.3 7.4 1.5
<CAPTION>
SHORT
FINANCIAL PREFERRED TERM
CAPITAL GOODS SERVICES UTILITIES STOCKS INVESTMENTS
------------- --------- --------- --------- -----------
<S> <C> <C> <C> <C>
4.4 8.4 1 3.8 5.6
</TABLE>
* Portfolio composition subject to change. Percentages based upon total
investments.
3
<PAGE> 4
LEADER INTERMEDIATE GOVERNMENT BOND FUND
PORTFOLIO MANAGER REPORT
COMMENTS FROM A CONVERSATION WITH L. CLARK ZEDRIC, PORTFOLIO MANAGER
How did the Fund perform over the past one-year period, and during the first
eight months of 2000?
The fund provided a total return of 5.86%(1) exclusive of sales loads, for the
one year ended August 31, 2000. In comparison, the Lehman Brothers 6-10 Year
Government/Corporate Bond Index rose 6.87% and the Lehman Brothers 1-5 Year
Government/Corporate Bond Index rose 5.96% for the period.
Through August 31, 2000, the Fund's year-to-date total return, exclusive of
sales charges, was 5.64%.(1) During the same period, the Lehman Brothers 6-10
Year Government/Corporate Bond Index rose 6.18%, and the Lehman Brothers 1-5
Year Government/Corporate Bond Index rose 4.75%.
The Fund's one-year return substantially improved from the same period one year
earlier. What primarily accounted for the difference between these two periods?
During the calendar year 1999, interest rates rose substantially in the 5-10
year range. The yield on the ten year bond went from 4.97% at month-end August
1998 to 5.98% at month-end August 1999 and 6.44% at December 31, 1999. Because
bond values fall as interest rates rise, this rise in rates pushed our total
return lower. This year however, the ten year bond yield declined to 5.72% at
the end of August. This move pushed prices up quite a bit, hence our positive
performance this year. The Fund's holdings are concentrated in the 5-10 year
area.
Through all of this volatility, you were able to maintain a high quality
portfolio and a relatively generous coupon rate.
Yes. As of August 31, 2000 over 63.6% of the portfolio was invested in Federal
Agency Bonds and U.S. Treasury Notes with the remainder in high quality
corporate bonds and short-term money market instruments. The Fund's dominant
credit rating was AAA and the Fund owns nothing below an A rating. As of August
31, 2000 the average portfolio coupon rate was almost 6.64%.(2)
How have you positioned the Fund for the coming year?
An essential part of our strategy is to maintain a "ladder" with bond maturities
spread over several years. This helps us to lessen the impact of interest rate
fluctuations on the value of the portfolio and ensures that some bonds mature
each year. We continue the "ladder" strategy and recently have been extending
the length slightly by purchasing some bonds with maturities of 10 to 14 years
maturity, modestly increasing the Fund's average life and duration. This action
reflects our view that interest rates should decline in the months ahead.
---------------
(1) With a maximum sales charge of 4.00%, the total return for the fiscal year
ended August 31, 2000 would have been 1.64%, and the total return for the
2000 year-to-date-period (through August 31, 2000) would have been 1.44%.
(2) The interest rate stated on the face of a bond represents the percentage of
interest to be paid by the issuer on the face value of the bond. The
composition of the Fund's holding is subject to change.
4
<PAGE> 5
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
IN THE LEADER INTERMEDIATE GOVERNMENT BOND FUND,
THE LEHMAN BROTHERS 1-5-YEAR GOVERNMENT/CORPORATE BOND INDEX AND
THE LEHMAN BROTHERS 6-10-YEAR GOVERNMENT/CORPORATE BOND INDEX
<TABLE>
<CAPTION>
LEHMAN BROTHERS 1-5 YEAR LEHMAN BROTHERS 6-10 YEAR
LEADER INTERMEDIATE GOVERNMENT/CORPORATE GOVERNMENT/CORPORATE
GOVERNMENT BOND FUND BOND INDEX BOND INDEX
-------------------- ------------------------ -------------------------
<S> <C> <C> <C>
8/31/94 9601 10000 10000
8/31/95 10398 10833 11243
8/31/96 10760 11368 11623
8/31/97 11620 12246 12856
8/31/98 12704 13266 14277
8/31/99 12454 13670 14280
8/31/00 13183 14485 15261
</TABLE>
COMPARATIVE TOTAL RETURN
for the periods ended August 31, 2000
<TABLE>
<CAPTION>
Since
2000 One Five Inception
YTD Year Year (8/31/94)
--------------------------------
<S> <C> <C> <C> <C>
LEADER Intermediate
Government Bond Fund
Without sales charge...... 5.64% 5.86% 4.86% 5.43%
With sales charge*........ 1.44% 1.64% 4.01% 4.71%
</TABLE>
* Reflects maximum sales charge of 4.00%.
PAST PERFORMANCE IS NOT PREDICTIVE OF
FUTURE RESULTS.
The performance of the LEADER
Intermediate Government Bond Fund
is measured against the Lehman
Brothers 1-5-Year
Government/Corporate Bond Index
and the Lehman Brothers 6-10-Year
Government/Corporate Bond Index;
the two indices are unmanaged and
generally represent a range of
1-5 and 6-10-year maturities.
These indices do not reflect the
deduction of fees associated with
a mutual fund, such as investment
management and fund accounting
fees. The Fund's performance
reflects the deduction of fees
for these value-added services.
The Fund's total returns would
have been lower had certain fees
not been waived during the
periods shown.
Investment return and NAV will
fluctuate, so that an investor's
shares, when redeemed, may be
worth more or less than the
original cost.
PORTFOLIO COMPOSITION*
AS OF 8/31/00
<TABLE>
<CAPTION>
SHORT TERM INVESTMENTS CORPORATE BONDS U.S. GOVERNMENT SECURITIES FEDERAL AGENCIES
---------------------- --------------- -------------------------- ----------------
<S> <C> <C> <C>
3 32.8 0.4 63.8
</TABLE>
* Portfolio composition subject to change. Percentages based upon total
investments.
5
<PAGE> 6
LEADER TAX-EXEMPT BOND FUND
PORTFOLIO MANAGER REPORT
COMMENTS FROM DISCUSSIONS WITH LUCY KASSON, PORTFOLIO MANAGER
How did the LEADER Tax-Exempt Bond Fund perform during the period?
The Leader Tax-Exempt Bond Fund's inception date was July 24, 2000. As of August
31, 2000, the Fund's 30-day effective yield was 4.27%, and the 7-day effective
yield was 4.35%.
What is the Fund's investment approach?
The Fund's investment approach strives to maintain consistent returns without a
lot of price volatility. The Fund is 100% invested in high-grade municipal
securities. We will continue to ease into the market over time, keeping credit
quality high while using a so-called laddered portfolio structure.
What is the Fund's current strategy?
Our strategy includes staying away from problem situations, such as those in the
disfavored health care sector. Our investment strategy was to buy good quality,
attractively structured national market names. On the sell side we selectively
sold securities when they were attractively priced.
COMPARATIVE TOTAL RETURN
for the periods ended August 31, 2000
<TABLE>
<CAPTION>
Since
Inception
(7/24/00)
---------
<S> <C>
LEADER Tax-Exempt Bond Fund
Without sales charge........................ 1.16%
With sales charge*.......................... (2.92%)
</TABLE>
* Reflects maximum sales charge of 4.00%.
PAST PERFORMANCE IS NOT PREDICTIVE OF
FUTURE RESULTS.
Investment return and NAV will
fluctuate, so that an investor's
shares, when redeemed, may be
worth more or less than the
original cost.
PORTFOLIO COMPOSITION*
AS OF 8/31/00
<TABLE>
<CAPTION>
SHORT TERM INVESTMENTS REVENUE GENERAL OBLIGATION
---------------------- ------- ------------------
<S> <C> <C>
7.9 48.1 44
</TABLE>
* Portfolio composition subject to change. Percentages based upon total
investments.
6
<PAGE> 7
LEADER MONEY MARKET FUND
PORTFOLIO MANAGER REPORT
COMMENTS FROM DISCUSSIONS WITH LUCY KASSON, PORTFOLIO MANAGER
How did the LEADER Money Market Fund perform during the period?
As of August 31, 2000, the effective 7-day yield for the LEADER Money Market
Fund was 6.32%.(1) In contrast, the effective 7-day yield of Tier One money
market funds as measured by iMoneyNet, Inc. was 6.18%. iMoneyNet, Inc. (formerly
IBC Financial Data, Inc.) is a research firm that tracks the performance of
money market funds.
What type of securities constituted the largest holdings?
The Fund was positioned to include U.S. government securities and agency
securities, followed by top-rated commercial paper, and bank and corporate
obligations.
What is the Fund's investment approach?
The investment strategy is to create a diversified portfolio of money market
instruments that presents minimal credit risks according to our criteria.
Securities are purchased that meet safety and liquidity guidelines.
---------------
(1) The 7-day current yield as of August 31, 2000 was 6.13%. An investment in
the fund is neither insured nor guaranteed by the FDIC or any other
government agency. Although the fund strives to maintain the value of your
investment at $1.00 per share, it is possible to lose money by investing in
the fund.
7
<PAGE> 8
LEADER GROWTH & INCOME FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
MARKET
SECURITY DESCRIPTION SHARES VALUE
-------------------- ---------- ------------
<S> <C> <C>
COMMON STOCKS -- (92.2%)
AIR TRAVEL -- (0.6%)
Delta Air Lines........................................ 20,000 $ 990,000
------------
ALUMINUM -- (1.1%)
Aluminum Company of America............................ 60,000 1,995,000
------------
AUTOMOBILES & TRUCKS -- (1.2%)
Ford Motor Company..................................... 87,400 2,113,988
------------
BREWERY -- (1.6%)
Anheuser-Busch Companies............................... 35,000 2,758,438
------------
CHEMICALS -- (1.0%)
Dow Chemical........................................... 70,000 1,833,125
------------
CLOTHING -- (0.7%)
TJX Companies.......................................... 70,000 1,316,875
------------
COMPUTER SOFTWARE -- (3.8%)
Computer Sciences Corporation*......................... 40,000 3,162,500
Microsoft*............................................. 50,800 3,546,475
------------
6,708,975
------------
COMPUTERS & BUSINESS EQUIPMENT -- (15.6%)
Cisco Systems*......................................... 115,000 7,877,500
Dell Computer*......................................... 80,000 3,490,000
Gateway*............................................... 40,000 2,724,000
Hewlett-Packard........................................ 20,000 2,415,000
Sun Microsystems*...................................... 90,000 11,424,374
------------
27,930,874
------------
DIVERSIFIED OPERATIONS -- (3.5%)
General Electric....................................... 105,000 6,162,188
------------
DRUGS & HEALTHCARE -- (13.4%)
Amgen*................................................. 80,000 6,065,000
Bristol-Myers Squibb................................... 40,000 2,120,000
Johnson & Johnson...................................... 20,000 1,838,750
Lilly (Eli) & Company.................................. 29,000 2,117,000
Merck & Company........................................ 25,200 1,760,850
</TABLE>
continued
8
<PAGE> 9
LEADER GROWTH & INCOME FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
MARKET
SECURITY DESCRIPTION SHARES VALUE
-------------------- ---------- ------------
<S> <C> <C>
COMMON STOCKS -- (CONTINUED)
DRUGS & HEALTHCARE -- (CONTINUED)
Pfizer................................................. 181,000 $ 7,828,249
Pharmacia.............................................. 35,000 2,049,688
------------
23,779,537
------------
ELECTRONIC COMPONENTS -- (6.9%)
Applied Materials*..................................... 40,000 3,452,500
Intel.................................................. 80,000 5,990,000
Texas Instruments...................................... 42,400 2,838,150
------------
12,280,650
------------
FINANCE & BANKING -- (5.2%)
Bank of America........................................ 25,000 1,339,063
Bank One............................................... 33,200 1,170,300
Chase Manhattan........................................ 45,000 2,514,374
First Union............................................ 30,000 868,125
Mellon Financial....................................... 36,600 1,656,150
SouthTrust............................................. 27,500 775,156
Wells Fargo............................................ 22,200 958,763
------------
9,281,931
------------
FINANCIAL SERVICES -- (3.4%)
Citigroup.............................................. 43,333 2,529,583
Fannie Mae............................................. 40,000 2,150,000
Hartford Financial Services Group...................... 20,000 1,332,500
------------
6,012,083
------------
FOOD & BEVERAGES -- (1.0%)
Coca-Cola.............................................. 16,000 842,000
PepsiCo................................................ 20,600 878,075
------------
1,720,075
------------
HOUSEHOLD PRODUCTS -- (0.8%)
Procter & Gamble....................................... 22,000 1,359,875
------------
</TABLE>
continued
9
<PAGE> 10
LEADER GROWTH & INCOME FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
MARKET
SECURITY DESCRIPTION SHARES VALUE
-------------------- ---------- ------------
<S> <C> <C>
COMMON STOCKS -- (CONTINUED)
INTERNATIONAL OIL -- (6.0%)
BP Amoco PLC - ADR..................................... 49,200 $ 2,718,300
Exxon Mobil............................................ 69,868 5,702,976
Texaco................................................. 42,000 2,163,000
------------
10,584,276
------------
MEDICAL INSTRUMENTS -- (1.7%)
Medtronic.............................................. 60,000 3,075,000
------------
MULTIMEDIA -- (2.2%)
Time Warner............................................ 46,600 3,984,300
------------
OIL & GAS -- (1.5%)
Conoco, Class B........................................ 79,847 2,086,002
Ultramar Diamond Shamrock.............................. 25,000 585,938
------------
2,671,940
------------
PAPER -- (2.2%)
Boise Cascade.......................................... 20,000 597,500
Georgia-Pacific Group.................................. 70,000 1,872,500
Kimberly-Clark......................................... 25,000 1,462,500
------------
3,932,500
------------
RAILROADS -- (0.3%)
Burlington Northern Santa Fe........................... 23,800 532,525
------------
RESTAURANTS -- (0.5%)
McDonald's............................................. 29,400 878,325
------------
RETAIL -- (2.0%)
Best Buy*.............................................. 20,000 1,235,000
Lowe's................................................. 10,000 448,125
Wal-Mart Stores........................................ 40,000 1,897,500
------------
3,580,625
------------
TELECOMMUNICATION EQUIPMENT -- (7.9%)
Corning................................................ 9,000 2,951,438
General Motors, Class H................................ 60,000 1,987,500
Lucent Technologies.................................... 50,000 2,090,625
</TABLE>
continued
10
<PAGE> 11
LEADER GROWTH & INCOME FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
MARKET
SECURITY DESCRIPTION SHARES VALUE
-------------------- ---------- ------------
<S> <C> <C>
COMMON STOCKS -- (CONTINUED)
TELECOMMUNICATION EQUIPMENT -- (CONTINUED)
Nokia Oyj - ADR........................................ 62,000 $ 2,774,500
Nortel Networks........................................ 30,000 2,446,875
Tellabs*............................................... 30,000 1,685,625
------------
13,936,563
------------
TELECOMMUNICATIONS -- (5.1%)
Qwest Communications International*.................... 45,826 2,365,767
Sprint................................................. 50,000 1,675,000
Sprint (PCS)*.......................................... 40,000 2,000,000
Verizon Communications................................. 35,990 1,570,064
WorldCom*.............................................. 37,500 1,368,750
------------
8,979,581
------------
TOBACCO -- (0.8%)
Philip Morris Companies................................ 50,000 1,481,250
------------
TRANSPORTATION & SHIPPING -- (0.6%)
United Parcel Service - Class B........................ 20,000 1,108,750
------------
UTILITIES -- ELECTRIC -- (0.9%)
GPU.................................................... 25,000 765,625
Xcel Energy............................................ 31,000 778,875
------------
1,544,500
------------
UTILITIES -- TELEPHONE -- (0.7%)
SBC Communications..................................... 29,200 1,219,100
------------
TOTAL COMMON STOCKS -- (Cost $88,191,076)................... 163,752,849
------------
PREFERRED STOCKS -- (3.9%)
BANKING -- (0.4%)
Harris Preferred Capital, Series A..................... 30,000 676,875
------------
FINANCIAL SERVICES -- (1.6%)
AT&T Capital........................................... 40,000 997,500
MediaOne Financial Trust............................... 40,000 1,015,000
Merrill Lynch Capital Trust............................ 40,000 915,000
------------
2,927,500
------------
</TABLE>
continued
11
<PAGE> 12
LEADER GROWTH & INCOME FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
SHARES
OR
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- ------------
<S> <C> <C>
PREFERRED STOCKS -- (CONTINUED)
INSURANCE -- (0.4%)
Allstate............................................... 35,000 $ 780,938
------------
OIL & GAS -- (0.3%)
UDS Capital, Series I.................................. 20,000 462,500
------------
TELECOMMUNICATIONS -- (0.5%)
Motorola Capital Trust................................. 40,000 872,500
------------
UTILITIES -- (0.7%)
Duke Energy Capital Trust.............................. 30,000 678,750
KCPL Financing, Series I............................... 20,000 490,000
------------
1,168,750
------------
TOTAL PREFERRED STOCKS -- (Cost $7,375,000)................. 6,889,063
------------
SHORT TERM INVESTMENTS -- (5.7%)
MUTUAL FUND -- (2.9%)
LEADER Money Market Fund............................... 5,107,333 5,107,333
------------
REPURCHASE AGREEMENT -- (2.8%)
Fifth Third Bank,
6.56%, maturing 9/1/2000 (Collateralized by
$5,034,843 Fannie Mae, 7.50%, 5/1/2012, Market
Value -- $5,054,887).............................. $4,955,772 4,955,772
------------
TOTAL SHORT TERM INVESTMENTS -- (Cost $10,063,105).......... 10,063,105
------------
TOTAL INVESTMENTS -- (Cost $105,629,181) (a) -- 101.8%...... 180,705,017
LIABILITIES IN EXCESS OF OTHER ASSETS -- (1.8)%............. (3,177,053)
------------
TOTAL NET ASSETS -- 100.0%.................................. $177,527,964
============
</TABLE>
---------------
Percentages indicated are based on net assets of $177,527,964.
(a) Cost for federal income tax and financial reporting is the same.
* Represents non-income producing securities.
ADR -- American Depositary Receipt
See notes to financial statements.
12
<PAGE> 13
LEADER INTERMEDIATE GOVERNMENT BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- ------------
<S> <C> <C>
CORPORATE BONDS -- (32.6%)
COMPUTERS -- (0.7%)
Electronic Data Systems
6.85%, 10/15/2004.................................... $ 500,000 $ 494,115
IBM
5.40%, 1/26/2009..................................... 500,000 445,895
------------
940,010
------------
FINANCE & BANKING -- (18.0%)
American General
6.75%, 6/15/2005..................................... 500,000 486,405
Bear Stearns Companies
7.00%, 3/1/2007...................................... 1,000,000 962,710
Chase Manhattan
7.125%, 2/1/2007..................................... 500,000 494,575
Citigroup
6.20%, 3/15/2009..................................... 500,000 468,870
Ford Capital BV
9.375%, 5/15/2001.................................... 380,000 384,195
Ford Motor Credit
6.125%, 4/28/2003.................................... 1,750,000 1,701,613
General Electric Capital
5.89%, 5/11/2001..................................... 750,000 744,278
General Motors Acceptance Corporation
6.125%, 11/15/2008................................... 1,000,000 916,270
Goldman Sachs Group
7.35%, 10/1/2009..................................... 500,000 492,865
7.80%, 1/28/2010..................................... 2,000,000 2,025,843
Inter-American Development Bank
6.00%, 5/13/2009..................................... 500,000 475,360
International Bank for Reconstruction & Development
7.00%, 1/27/2005..................................... 2,000,000 2,022,820
Merrill Lynch & Company
8.00%, 2/1/2002...................................... 325,000 328,487
6.07%, 4/6/2004...................................... 750,000 721,133
8.00%, 6/1/2007...................................... 500,000 515,835
</TABLE>
continued
13
<PAGE> 14
LEADER INTERMEDIATE GOVERNMENT BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- ------------
<S> <C> <C>
CORPORATE BONDS -- (CONTINUED)
FINANCE & BANKING -- (CONTINUED)
Morgan Stanley Dean Witter
6.75%, 10/15/2013.................................... $1,000,000 $ 923,190
National City Bank of Kentucky
6.30%, 2/15/2011..................................... 1,000,000 888,310
NationsBank
6.375%, 2/15/2008.................................... 1,000,000 931,870
6.60%, 5/15/2010..................................... 1,000,000 929,610
7.04%, 8/15/2012..................................... 500,000 477,485
Northern Trust
7.10%, 8/1/2009...................................... 1,500,000 1,467,165
Norwest Financial
7.20%, 5/1/2007...................................... 1,000,000 990,070
Salomon Smith Barney Holdings
7.30%, 8/1/2013...................................... 1,000,000 966,580
St. Paul Companies
7.29%, 8/28/2007..................................... 500,000 512,495
Swiss Bank of New York
7.00%, 10/15/2015.................................... 1,000,000 940,904
Union Bank Switzerland - NY
7.25%, 7/15/2006..................................... 1,000,000 989,810
Wachovia
6.375%, 2/1/2009..................................... 1,000,000 928,420
------------
23,687,168
------------
FOOD & BEVERAGES -- (0.6%)
General Foods
6.00%, 6/15/2001..................................... 750,000 739,890
------------
INDUSTRIALS -- (3.4%)
Boeing
8.10%, 11/15/2006.................................... 500,000 525,090
Dupont
8.125%, 3/15/2004.................................... 765,000 794,620
Ford Motor Company
9.00%, 9/15/2001..................................... 280,000 284,553
9.50%, 9/15/2011..................................... 230,000 260,144
</TABLE>
continued
14
<PAGE> 15
LEADER INTERMEDIATE GOVERNMENT BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- ------------
<S> <C> <C>
CORPORATE BONDS -- (CONTINUED)
INDUSTRIALS -- (CONTINUED)
Loews Corporation
6.75%, 12/15/2006.................................... $ 500,000 $ 465,290
Monsanto Company
8.75%, 5/15/2001..................................... 200,000 202,332
Philip Morris Companies
8.75%, 6/1/2001...................................... 250,000 250,193
7.50%, 1/15/2002..................................... 360,000 355,183
7.25%, 1/15/2003..................................... 700,000 682,493
R.R. Donnelley & Sons
7.00%, 1/1/2003...................................... 700,000 693,861
------------
4,513,759
------------
RESTAURANTS -- (1.4%)
McDonald's
5.35%, 9/15/2008..................................... 2,000,000 1,789,200
------------
RETAIL -- (0.4%)
Wal-Mart Stores
6.875%, 8/10/2009.................................... 500,000 495,245
------------
TRANSPORTATION -- (0.2%)
Norfolk & Southern Railway
7.75%, 8/15/2005..................................... 225,000 226,179
------------
UTILITIES -- (7.9%)
Alabama Power
5.375%, 10/1/2008.................................... 1,000,000 871,627
AT&T
7.125%, 1/15/2002.................................... 960,000 959,693
5.625%, 3/15/2004.................................... 1,000,000 944,360
Baltimore Gas & Electric
6.125%, 7/1/2003..................................... 311,000 303,455
Bellsouth Cap Funding
7.75%, 2/15/2010..................................... 1,000,000 1,011,188
Carolina Telephone & Telegraph
7.25%, 12/15/2004.................................... 1,000,000 998,250
</TABLE>
continued
15
<PAGE> 16
LEADER INTERMEDIATE GOVERNMENT BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- ------------
<S> <C> <C>
CORPORATE BONDS -- (CONTINUED)
UTILITIES -- (CONTINUED)
Entergy Louisiana
6.50%, 3/1/2008...................................... $ 500,000 $ 470,190
Florida Power and Light
5.875%, 4/1/2009..................................... 500,000 443,800
National Rural Utilities
7.30%, 9/15/2006..................................... 1,000,000 1,002,550
7.20%, 10/1/2015..................................... 1,950,000 1,891,071
Northern Telecom
8.75%, 6/12/2001..................................... 430,000 435,087
Pacific Bell
7.25%, 7/1/2002...................................... 1,000,000 1,003,650
------------
10,334,921
------------
TOTAL CORPORATE BONDS -- (Cost $43,866,672)................. 42,726,372
------------
GOVERNMENT AND AGENCY BONDS -- (63.6%)
FEDERAL AGENCIES -- (61.1%)
FANNIE MAE -- (21.1%)
6.18%, 3/15/2001..................................... 510,000 508,471
6.50%, 8/15/2004..................................... 250,000 247,515
6.83%, 10/10/2007.................................... 500,000 480,935
6.27%, 2/13/2008..................................... 1,000,000 943,440
6.14%, 9/2/2008...................................... 1,000,000 935,000
6.00%, 12/18/2008.................................... 1,000,000 922,660
6.03%, 2/2/2009...................................... 1,000,000 925,780
7.00%, 12/5/2011..................................... 1,000,000 975,170
7.00%, 3/1/2012...................................... 936,181 927,989
7.00%, 4/1/2012...................................... 1,209,084 1,198,504
7.00%, 8/14/2012..................................... 1,500,000 1,429,680
7.00%, 8/27/2012..................................... 1,500,000 1,440,705
6.875%, 9/10/2012.................................... 500,000 487,847
7.00%, 10/29/2012.................................... 500,000 474,530
6.26%, 11/26/2012.................................... 1,000,000 942,256
6.50%, 12/1/2012..................................... 1,163,887 1,135,314
6.50%, 1/1/2013...................................... 1,557,972 1,519,724
7.00%, 3/4/2013...................................... 1,000,000 943,910
</TABLE>
continued
16
<PAGE> 17
LEADER INTERMEDIATE GOVERNMENT BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- ------------
<S> <C> <C>
GOVERNMENT AND AGENCY BONDS -- (CONTINUED)
FEDERAL AGENCIES -- (CONTINUED)
FANNIE MAE -- (CONTINUED)
6.00%, 7/1/2013...................................... $ 589,362 $ 564,668
6.25%, 2/18/2014..................................... 2,000,000 1,811,560
6.37%, 2/25/2014..................................... 2,000,000 1,825,940
6.00%, 3/1/2014...................................... 884,890 846,017
6.50%, 6/1/2014...................................... 855,305 834,307
7.00%, 6/1/2014...................................... 673,395 666,008
7.00%, 12/12/2016.................................... 1,000,000 947,788
6.75%, 8/25/2021..................................... 920,000 900,156
7.05%, 4/25/2022..................................... 925,000 906,204
7.50%, 1/1/2030...................................... 1,989,106 1,976,096
------------
27,718,174
------------
FEDERAL FARM CREDIT BANK -- (3.5%)
6.20%, 11/30/2009.................................... 1,000,000 945,620
6.01%, 6/16/2010..................................... 2,000,000 1,846,880
6.125%, 1/22/2013.................................... 1,000,000 892,660
6.27%, 1/26/2016..................................... 1,000,000 917,810
------------
4,602,970
------------
FEDERAL HOME LOAN BANK -- (21.4%)
6.00%, 1/24/2001..................................... 1,500,000 1,495,398
5.935%, 7/2/2001..................................... 500,000 496,713
5.875%, 8/15/2001.................................... 500,000 496,070
5.125%, 2/26/2002.................................... 1,500,000 1,467,128
6.00%, 8/15/2002..................................... 250,000 246,718
6.25%, 11/15/2002.................................... 1,000,000 990,887
5.50%, 1/21/2003..................................... 500,000 486,889
6.75%, 4/5/2004...................................... 500,000 499,505
6.47%, 6/30/2004..................................... 500,000 494,667
6.25%, 8/13/2004..................................... 500,000 490,763
7.125%, 2/15/2005.................................... 2,000,000 2,025,753
6.75%, 4/10/2006..................................... 500,000 498,936
6.375%, 8/15/2006.................................... 250,000 244,853
7.325%, 5/30/2007.................................... 1,000,000 1,027,340
6.12%, 8/26/2008..................................... 500,000 467,345
</TABLE>
continued
17
<PAGE> 18
LEADER INTERMEDIATE GOVERNMENT BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- ------------
<S> <C> <C>
GOVERNMENT AND AGENCY BONDS -- (CONTINUED)
FEDERAL AGENCIES -- (CONTINUED)
FEDERAL HOME LOAN BANK -- (CONTINUED)
5.655%, 12/18/2008................................... $ 500,000 $ 454,845
6.795%, 6/30/2009.................................... 1,000,000 991,455
7.375%, 2/12/2010.................................... 1,000,000 1,029,220
7.01%, 12/4/2012..................................... 1,000,000 946,090
6.125%, 1/9/2013..................................... 2,000,000 1,839,380
6.00%, 9/1/2013...................................... 823,154 789,051
6.73%, 9/17/2013..................................... 1,000,000 931,560
5.83%, 9/30/2013..................................... 1,000,000 893,280
6.10%, 2/19/2014..................................... 1,000,000 893,750
6.045%, 5/12/2014.................................... 1,000,000 907,970
6.625%, 6/30/2014.................................... 1,000,000 971,560
8.00%, 8/19/2014..................................... 1,000,000 978,120
7.10%, 8/27/2014..................................... 2,000,000 2,017,829
8.00%, 9/3/2014...................................... 1,000,000 987,850
7.375%, 2/13/2015.................................... 2,000,000 2,067,179
------------
28,128,104
------------
FREDDIE MAC -- (13.0%)
6.745%, 8/1/2001..................................... 450,000 449,998
7.50%, 1/1/2007...................................... 9,715 9,730
7.10%, 4/10/2007..................................... 2,000,000 2,031,595
7.14%, 12/15/2007.................................... 1,000,000 1,047,640
6.50%, 5/1/2008...................................... 49,362 48,593
7.00%, 3/15/2010..................................... 1,000,000 1,006,970
6.00%, 11/1/2010..................................... 126,720 122,856
6.135%, 2/15/2011.................................... 1,000,000 928,910
6.77%, 3/21/2011..................................... 1,000,000 969,800
6.125%, 7/28/2011.................................... 1,000,000 912,190
6.71%, 12/5/2011..................................... 2,000,000 1,918,440
7.27%, 2/6/2012...................................... 1,000,000 994,060
7.49%, 4/16/2012..................................... 1,000,000 1,007,970
6.00%, 9/1/2013...................................... 858,517 822,949
6.00%, 10/1/2013..................................... 832,414 797,927
7.09%, 11/22/2016.................................... 500,000 478,515
</TABLE>
continued
18
<PAGE> 19
LEADER INTERMEDIATE GOVERNMENT BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- ------------
<S> <C> <C>
GOVERNMENT AND AGENCY BONDS -- (CONTINUED)
FEDERAL AGENCIES -- (CONTINUED)
FREDDIE MAC -- (CONTINUED)
7.00%, 1/15/2023..................................... $1,000,000 $ 947,810
7.00%, 12/15/2023.................................... 546,000 536,101
6.50%, 2/15/2024..................................... 37,725 37,407
8.00%, 5/1/2030...................................... 1,995,504 2,016,317
------------
17,085,778
------------
GINNIE MAE -- (2.1%)
7.50%, 6/20/2029..................................... 1,742,968 1,735,108
7.50%, 10/20/2029.................................... 968,557 964,189
------------
2,699,297
------------
80,234,323
------------
U.S. GOVERNMENT SECURITIES -- (2.5%)
TENNESSEE VALLEY AUTHORITY -- (2.1%)
6.00%, 3/15/2013..................................... 3,000,000 2,755,770
------------
UNITED STATES TREASURY NOTES -- (0.4%)
6.50%, 10/15/2006.................................... 500,000 512,185
------------
3,267,955
------------
TOTAL GOVERNMENT AND AGENCY BONDS -- (Cost $86,015,529)..... 83,502,278
------------
SHORT TERM INVESTMENTS -- (3.0%)
REPURCHASE AGREEMENT -- (3.0%)
Fifth Third Bank
6.56%, maturing 9/1/2000 (Collateralized by
$3,938,763 Fannie Mae, 7.50%, 5/1/2012, Market
Value -- $3,954,444).............................. 3,876,906 3,876,906
------------
TOTAL SHORT TERM INVESTMENTS -- (Cost $3,876,906)........... 3,876,906
------------
TOTAL INVESTMENTS -- (Cost $133,759,107) (a) -- 99.2%....... 130,105,556
OTHER ASSETS IN EXCESS OF LIABILITIES -- 0.8%............... 995,174
------------
TOTAL NET ASSETS -- 100.0%.................................. $131,100,730
============
</TABLE>
---------------
Percentages indicated are based on net assets of $131,100,730.
(a) Cost for federal income tax and financial reporting is the same.
See notes to financial statements.
19
<PAGE> 20
LEADER TAX-EXEMPT BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- -----------
<S> <C> <C>
MUNICIPAL BONDS -- (95.4%)
ALASKA -- (4.6%)
Anchorage Alaska, General Obligation Series A, 5.625%,
9/1/2016.............................................. $1,000,000 $ 1,022,550
-----------
COLORADO -- (4.9%)
Denver Colorado City & County Airport, Revenue Series
E, 6.00%, 11/15/2011.................................. 1,000,000 1,088,496
-----------
FLORIDA -- (4.2%)
Orange County Florida Water Utilities Systems, Revenue
4.75%, 10/1/2014...................................... 500,000 477,725
Reedy Creek Improvement Florida, General Obligation
Series A, 4.75%, 6/1/2017............................. 500,000 460,455
-----------
938,180
-----------
ILLINOIS -- (5.3%)
Cook County Illinois Community College, Revenue Series
C, 7.70%, 12/1/2007................................... 1,000,000 1,182,412
-----------
LOUISIANA -- (4.7%)
Louisiana State, General Obligation Series B, 5.50%,
4/15/2006............................................. 1,000,000 1,043,990
-----------
NEBRASKA -- (5.0%)
Omaha Public Power, Revenue Series B, 6.15%,
2/1/2012.............................................. 1,000,000 1,107,339
-----------
NEVADA -- (8.1%)
Henderson Nevada, General Obligation Series B, 4.75%,
6/1/2006.............................................. 1,000,000 1,003,750
Nevada State, General Obligation
6.50%, 12/1/2011..................................... 750,000 802,628
-----------
1,806,378
-----------
NORTH CAROLINA -- (4.4%)
North Carolina Medical Care Commission Health Care
Facilities, Revenue Series A, 4.25%, 10/1/2004........ 1,000,000 979,570
-----------
</TABLE>
continued
20
<PAGE> 21
LEADER TAX-EXEMPT BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- -----------
<S> <C> <C>
MUNICIPAL BONDS -- (CONTINUED)
OHIO -- (4.6%)
Ohio State Public Facilities Community, Revenue Series
II-A, 5.20%, 5/1/2007................................. $1,000,000 $ 1,024,810
-----------
OREGON -- (2.3%)
Salem-Keizer Oregon School District, General Obligation
5.10%, 6/1/2012....................................... 500,000 505,695
-----------
SOUTH DAKOTA -- (4.5%)
Heartland Consumers Power District, Revenue 6.375%,
1/1/2016.............................................. 905,000 997,201
-----------
TENNESSEE -- (11.5%)
Cleveland Tennessee, General Obligation
5.00%, 9/1/2010...................................... 500,000 504,690
Jackson Tennessee Hospital, Revenue
5.50%, 4/1/2010...................................... 500,000 514,115
Memphis Tennessee, General Obligation
5.10%, 11/1/2008..................................... 1,000,000 1,024,850
Nashville & Davidson County H & E Facilities, Revenue
Series A, 6.00%, 10/1/2022............................ 500,000 509,895
-----------
2,553,550
-----------
TEXAS -- (20.4%)
Austin Texas, General Obligation
4.75%, 9/1/2014...................................... 1,000,000 938,150
Brownsville Texas Utility Systems, Revenue 7.375%,
1/1/2010.............................................. 625,000 701,050
El Paso Texas, General Obligation Series A, 5.50%,
8/15/2009............................................. 1,000,000 1,037,910
Hunt County Texas, General Obligation
4.85%, 3/1/2014...................................... 500,000 476,170
San Antonio Texas Water, Revenue
6.40%, 5/15/2006..................................... 825,000 864,938
Travis County Texas, General Obligation
4.625%, 3/1/2012..................................... 550,000 531,674
-----------
4,549,892
-----------
</TABLE>
continued
21
<PAGE> 22
LEADER TAX-EXEMPT BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- -----------
<S> <C> <C>
MUNICIPAL BONDS -- (CONTINUED)
WASHINGTON -- (10.9%)
Washington State Public Power Supply System Nuclear
Project No. 1, Revenue Series B, 7.25%, 7/1/2009...... $ 500,000 $ 574,775
Washington State Public Power Supply System Nuclear
Project No. 2, Revenue Series A, 6.00%, 7/1/2007...... 1,000,000 1,067,810
Washington State, General Obligation Series B, 5.50%,
5/1/2009.............................................. 750,000 791,115
-----------
2,433,700
-----------
TOTAL MUNICIPAL BONDS -- (Cost $20,778,441)................. 21,233,763
-----------
SHORT TERM INVESTMENTS -- (8.2%)
REPURCHASE AGREEMENT -- (8.2%)
Fifth Third Bank
6.56%, maturing 9/1/2000 (Collateralized by
$1,932,266 Freddie Mac, 6.122%, 8/1/2029,
Market Value -- $1,858,179).................... 1,821,744 1,821,744
-----------
TOTAL SHORT TERM INVESTMENTS -- (Cost $1,821,744)........... 1,821,744
-----------
TOTAL INVESTMENTS -- (Cost $22,600,185) (a) -- 103.6%....... 23,055,507
LIABILITIES IN EXCESS OF OTHER ASSETS -- (3.6)%............. (794,631)
-----------
TOTAL NET ASSETS -- 100.0%.................................. $22,260,876
===========
</TABLE>
---------------
Percentages indicated are based on net assets of $22,260,876.
(a) Cost for federal income tax and financial reporting is the same.
See notes to financial statements.
22
<PAGE> 23
LEADER MONEY MARKET FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- ------------
<S> <C> <C>
COMMERCIAL PAPER -- (36.6%)
FINANCE & BANKING -- (2.0%)
Vehicle Services America
0.00%, 9/14/2000..................................... $5,600,000 $ 5,586,835
------------
INDUSTRIALS -- (3.6%)
CSN
0.00%, 9/13/2000..................................... 10,000,000 9,978,300
------------
INSURANCE -- (7.1%)
Massachusetts Mutual Life Insurance
0.00%, 9/19/2000..................................... 10,000,000 9,967,501
Oil Insurance
0.00%, 9/15/2000..................................... 9,500,000 9,475,691
------------
19,443,192
------------
OFFICE SUPPLIES -- (3.6%)
Avery Denison
0.00%, 9/1/2000...................................... 10,000,000 10,000,000
------------
PETROLEUM REFINING -- (4.9%)
Deer Park
6.645%, 9/1/2000..................................... 13,500,000 13,500,000
------------
RETAIL -- (5.2%)
Estee Lauder
0.00%, 9/5/2000...................................... 4,500,000 4,496,760
The Gap
0.00%, 9/12/2000..................................... 10,000,000 9,980,013
------------
14,476,773
------------
TELECOMMUNICATIONS -- (1.9%)
Lucent Technologies
0.00%, 9/28/2000..................................... 5,300,000 5,274,242
------------
</TABLE>
continued
23
<PAGE> 24
LEADER MONEY MARKET FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- ------------
<S> <C> <C>
COMMERCIAL PAPER -- (CONTINUED)
UTILITIES -- (5.8%)
AT&T
6.75%, 7/13/2001..................................... $5,000,000 $ 4,999,999
Jersey Central Power & Light
0.00%, 9/6/2000...................................... 4,000,000 3,996,306
0.00%, 9/7/2000...................................... 3,300,000 3,296,233
0.00%, 9/8/2000...................................... 3,650,000 3,645,174
------------
15,937,712
------------
WATER TRANSPORTATION -- (2.5%)
Port Arthur
6.65%, 9/28/2000..................................... 7,000,000 7,000,000
------------
TOTAL COMMERCIAL PAPER -- (Cost $101,197,054)............... 101,197,054
------------
CORPORATE BONDS -- (12.5%)
FINANCE & BANKING -- (11.1%)
Associates Corporation
6.70%, 5/29/2001..................................... 2,000,000 1,998,125
*6.77%, 6/26/2001.................................... 5,000,000 5,000,000
Chase Manhattan
10.125%, 11/1/2000................................... 1,000,000 1,004,890
General Motors Acceptance Corporation
6.375%, 9/19/2000.................................... 500,000 499,961
5.33%, 10/20/2000.................................... 5,000,000 4,990,527
7.125%, 5/1/2001..................................... 5,000,000 5,007,809
International Lease Finance
6.78%, 9/5/2001...................................... 5,000,000 4,995,900
Merrill Lynch
*6.60%, 4/18/2001.................................... 5,000,000 5,000,000
Morgan Stanley Dean Witter
5.97%, 2/8/2001...................................... 1,000,000 995,571
Salomon Smith Barney Holdings
5.875%, 2/1/2001..................................... 1,000,000 994,471
------------
30,487,254
------------
</TABLE>
continued
24
<PAGE> 25
LEADER MONEY MARKET FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- ------------
<S> <C> <C>
CORPORATE BONDS -- (CONTINUED)
RETAIL -- (1.4%)
Wal-Mart Stores
6.15%, 8/10/2001..................................... $4,000,000 $ 3,976,247
------------
TOTAL CORPORATE BONDS -- (Cost $34,463,501)................. 34,463,501
------------
GOVERNMENT AND AGENCY BONDS -- (34.7%)
FEDERAL AGENCIES -- (32.5%)
FANNIE MAE -- (8.2%)
5.31%, 9/15/2000..................................... 300,000 299,893
5.10%, 9/25/2000..................................... 2,145,000 2,143,479
5.97%, 9/25/2000..................................... 1,000,000 999,825
*6.629%, 9/29/2000................................... 5,000,000 4,999,885
5.78%, 10/10/2000.................................... 500,000 499,727
5.83%, 10/16/2000.................................... 1,000,000 999,236
4.85%, 11/20/2000.................................... 1,100,000 1,096,620
5.89%, 11/24/2000.................................... 875,000 874,001
5.10%, 11/29/2000.................................... 1,000,000 997,232
5.82%, 12/5/2000..................................... 1,000,000 998,833
4.87%, 12/15/2000.................................... 1,000,000 996,059
8.25%, 12/18/2000.................................... 800,000 804,473
5.10%, 12/29/2000.................................... 950,000 945,655
5.15%, 1/12/2001..................................... 1,000,000 995,024
5.50%, 2/2/2001...................................... 3,600,000 3,583,600
5.65%, 3/5/2001...................................... 1,385,000 1,374,930
------------
22,608,472
------------
FEDERAL FARM CREDIT BANK -- (0.5%)
6.15%, 4/2/2001...................................... 1,305,000 1,297,286
------------
FEDERAL HOME LOAN BANK -- (12.9%)
*6.468%, 9/12/2000................................... 5,000,000 5,000,090
6.125%, 9/20/2000.................................... 600,000 600,112
5.22%, 10/13/2000.................................... 1,000,000 998,604
4.565%, 10/16/2000................................... 1,500,000 1,497,160
4.395%, 10/23/2000................................... 4,255,000 4,243,946
6.05%, 11/3/2000..................................... 1,050,000 1,049,514
6.09%, 11/3/2000..................................... 1,000,000 999,271
</TABLE>
continued
25
<PAGE> 26
LEADER MONEY MARKET FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- ------------
<S> <C> <C>
GOVERNMENT AND AGENCY BONDS -- (CONTINUED)
FEDERAL AGENCIES -- (CONTINUED)
FEDERAL HOME LOAN BANK -- (CONTINUED)
6.20%, 11/3/2000..................................... $1,000,000 $ 999,486
5.00%, 12/1/2000..................................... 800,000 797,414
5.84%, 12/1/2000..................................... 3,000,000 2,996,064
5.97%, 12/1/2000..................................... 1,000,000 999,298
5.75%, 12/15/2000.................................... 1,000,000 998,140
6.39%, 2/7/2001...................................... 4,360,000 4,345,914
6.465%, 2/16/2001.................................... 1,310,000 1,305,954
5.50%, 3/12/2001..................................... 1,150,000 1,143,357
6.50%, 3/15/2001..................................... 2,000,000 1,999,400
6.80%, 4/17/2001..................................... 6,000,000 5,999,999
------------
35,973,723
------------
FREDDIE MAC -- (0.4%)
5.40%, 1/5/2001...................................... 1,000,000 995,337
------------
SALLIE MAE -- (10.5%)
*6.472%, 9/21/2000................................... 5,000,000 5,000,000
6.045%, 11/3/2000.................................... 1,000,000 999,443
*7.022%, 11/13/2000.................................. 3,000,000 2,999,823
*6.852%, 12/21/2000.................................. 5,000,000 5,000,000
*6.672%, 2/15/2001................................... 10,000,000 9,999,999
*6.718%, 8/9/2001.................................... 5,000,000 4,997,747
------------
28,997,012
------------
89,871,830
------------
U.S. GOVERNMENT SECURITIES -- (2.2%)
African Development Bank
8.625%, 5/1/2001..................................... 5,000,000 5,057,680
Tennessee Valley Authority
6.00%, 11/1/2000..................................... 890,000 889,427
------------
5,947,107
------------
TOTAL GOVERNMENT AND AGENCY BONDS -- (Cost $95,818,937)..... 95,818,937
------------
</TABLE>
continued
26
<PAGE> 27
LEADER MONEY MARKET FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- ------------
<S> <C> <C>
MUNICIPAL BONDS -- (14.7%)
CALIFORNIA -- (3.5%)
Inland Empire Solid Waste Financing Authority, Revenue
Series A, *6.60%, 8/1/2016........................... $5,000,000 $ 5,000,000
Sacramento County California, Revenue
*6.549%, 7/1/2022.................................... 4,560,000 4,560,000
------------
9,560,000
------------
ILLINOIS -- (2.4%)
Edward Obligated Group Illinois, Revenue Series B,
*6.68%, 2/15/2027.................................... 2,000,000 2,000,000
Illinois Student Assistance, Revenue *6.58%,
12/1/2022............................................ 4,700,000 4,700,000
------------
6,700,000
------------
INDIANA -- (0.0%)
Indiana State Finance Authority, Revenue *6.60%,
1/1/2009............................................. 100,000 100,000
------------
NEW YORK -- (5.4%)
Metropolitan Transportation Authority
New York Commuter, Revenue
*6.60%, 7/1/2003..................................... 3,000,000 3,000,000
New York City Housing Development
Corporation Multifamily, Revenue
*6.645%, 6/1/2033.................................... 3,000,000 3,000,000
New York State Housing Financing Agency, Revenue
*6.65%, 11/1/2030.................................... 2,900,000 2,900,000
New York State Housing Financing Agency, Revenue
*6.60%, 11/1/2032.................................... 5,900,000 5,900,000
------------
14,800,000
------------
TEXAS -- (2.7%)
Brazos Texas Utility, Revenue
*6.65%, 12/18/2000................................... 4,735,000 4,735,000
Texas State Veterans Administration, General Obligation
*6.60%, 12/1/2009.................................... 2,700,000 2,700,000
------------
7,435,000
------------
</TABLE>
continued
27
<PAGE> 28
LEADER MONEY MARKET FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 2000
<TABLE>
<CAPTION>
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- ------------
<S> <C> <C>
MUNICIPAL BONDS -- (CONTINUED)
UTAH -- (0.7%)
Utah State Housing Financing Agency, Revenue Series
C-I, *6.60%, 7/1/2031................................ $2,000,000 $ 2,000,000
------------
TOTAL MUNICIPAL BONDS -- (Cost $40,595,000)................. 40,595,000
------------
WEEKLY DEMAND NOTE -- (1.1%)
FINANCIAL SERVICES -- (1.1%)
Everett Clinic *6.65%, 12/1/2018....................... 3,000,000 3,000,000
------------
TOTAL WEEKLY DEMAND NOTE -- (Cost $3,000,000)............... 3,000,000
------------
SHORT TERM INVESTMENTS -- (0.5%)
REPURCHASE AGREEMENT -- (0.5%)
Fifth Third Bank
6.56%, maturing 9/1/2000 (Collateralized by
$1,585,787 Fannie Mae, 6.50%, 2/1/2019, Market
Value-$1,528,583)................................. 1,498,611 1,498,611
------------
TOTAL SHORT TERM INVESTMENTS -- (Cost $1,498,611)........... 1,498,611
------------
TOTAL INVESTMENTS -- (Cost $276,573,103) (a) -- 100.1%...... 276,573,103
LIABILITIES IN EXCESS OF OTHER ASSETS -- (0.1)%............. (386,983)
------------
TOTAL NET ASSETS -- 100.0%.................................. $276,186,120
============
</TABLE>
---------------
Percentages indicated are based on net assets of $276,186,120.
(a) Cost for federal income tax and financial reporting is the same.
* Variable Rate Interest. The rate presented is the rate in effect at August 31,
2000.
See notes to financial statements.
28
<PAGE> 29
LEADER MUTUAL FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
AUGUST 31, 2000
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GROWTH & INTERMEDIATE TAX- MONEY
INCOME GOVERNMENT EXEMPT BOND MARKET
FUND BOND FUND FUND FUND
------------ ------------ ----------- ------------
<S> <C> <C> <C> <C>
ASSETS:
Investments in securities, at value (cost
$100,673,409, $129,882,201, $20,778,441,
and $275,074,492, respectively)......... $175,749,245 $126,228,650 $21,233,763 $275,074,492
Repurchase agreements (cost $4,955,772,
$3,876,906, $1,821,744, and $1,498,611,
respectively)........................... 4,955,772 3,876,906 1,821,744 1,498,611
------------ ------------ ----------- ------------
TOTAL INVESTMENTS....................... 180,705,017 130,105,556 23,055,507 276,573,103
------------ ------------ ----------- ------------
Dividends and interest receivable......... 282,855 1,718,775 314,145 2,067,585
Receivable for investment securities
sold.................................... 1,274,333 -- -- --
Prepaid expenses and other assets......... 8,254 1,597 95 3,922
------------ ------------ ----------- ------------
TOTAL ASSETS............................ 182,270,459 131,825,928 23,369,747 278,644,610
------------ ------------ ----------- ------------
LIABILITIES:
Payable for investment securities
purchased............................... 4,662,894 -- 1,022,550 1,097,798
Distributions payable..................... -- 673,455 79,781 1,299,727
Accrued expenses:
Advisory fees........................... 75,742 45,916 5,675 40,156
Administration fees..................... 3,859 2,866 479 5,026
Other................................... -- 2,961 386 15,783
------------ ------------ ----------- ------------
TOTAL LIABILITIES....................... 4,742,495 725,198 1,108,871 2,458,490
------------ ------------ ----------- ------------
NET ASSETS................................ $177,527,964 $131,100,730 $22,260,876 $276,186,120
============ ============ =========== ============
COMPOSITION OF NET ASSETS:
Paid-in capital........................... $ 97,602,499 $135,446,052 $21,690,744 $276,186,479
Accumulated undistributed (distributions
in excess of) net investment income..... 356,558 (1,371) -- --
Accumulated net realized gains (losses) on
investments............................. 4,493,071 (690,400) 114,810 (359)
Net unrealized appreciation (depreciation)
on investments.......................... 75,075,836 (3,653,551) 455,322 --
------------ ------------ ----------- ------------
NET ASSETS................................ $177,527,964 $131,100,730 $22,260,876 $276,186,120
============ ============ =========== ============
Shares of beneficial interest outstanding,
no par value............................ 5,076,748 10,953,188 2,211,221 276,186,479
============ ============ =========== ============
Net asset value and redemption price per
share................................... $ 34.97 $ 11.97 $ 10.07 $ 1.00
============ ============ =========== ============
Maximum Sales Charge...................... 4.00% 4.00% 4.00% --
============ ============ =========== ============
Maximum offering price (100%/(100%-Maximum
Sales Charge) of net asset value
adjusted to the nearest cent) per
share................................... $ 36.43 $ 12.47 $ 10.49 $ 1.00
============ ============ =========== ============
</TABLE>
See notes to financial statements.
29
<PAGE> 30
LEADER MUTUAL FUNDS
STATEMENTS OF OPERATIONS
FOR THE PERIOD ENDED AUGUST 31, 2000
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GROWTH & INTERMEDIATE TAX- MONEY
INCOME GOVERNMENT EXEMPT BOND MARKET
FUND BOND FUND FUND(A) FUND
----------- ------------ ----------- -----------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest income....................... $ 494,733 $5,911,623 $119,619 $11,160,831
Dividend income....................... 2,436,312 -- -- --
----------- ---------- -------- -----------
TOTAL INCOME........................ 2,931,045 5,911,623 119,619 11,160,831
----------- ---------- -------- -----------
EXPENSES:
Advisory fees......................... 1,216,860 418,206 11,613 743,725
Administration fees................... 324,497 167,284 4,645 371,891
12b-1 fees............................ 405,620 209,104 5,806 464,826
Fund accounting fees.................. 52,670 50,588 3,264 57,997
Transfer agent fees................... 32,194 22,451 32 26,344
Trustees' fees and expenses........... 17,181 9,187 333 18,108
Other................................. 91,399 73,900 4,964 204,453
----------- ---------- -------- -----------
TOTAL EXPENSES...................... 2,140,421 950,720 30,657 1,887,344
Less: Expenses voluntarily
reduced/waived................... (811,240) (292,744) (10,451) (948,247)
----------- ---------- -------- -----------
Net expenses........................ 1,329,181 657,976 20,206 939,097
----------- ---------- -------- -----------
NET INVESTMENT INCOME................. 1,601,864 5,253,647 99,413 10,221,734
----------- ---------- -------- -----------
REALIZED AND UNREALIZED GAINS (LOSSES)
ON INVESTMENTS:
Realized gains (losses) on
investments......................... 4,615,701 (594,305) 114,810 1,203
Net change in unrealized appreciation
(depreciation) on investments....... 18,875,140 619,386 33,323 --
----------- ---------- -------- -----------
Net realized and unrealized gains
(losses) on investments............. 23,490,841 25,081 148,133 1,203
----------- ---------- -------- -----------
CHANGE IN NET ASSETS RESULTING FROM
OPERATIONS.......................... $25,092,705 $5,278,728 $247,546 $10,222,937
=========== ========== ======== ===========
</TABLE>
---------------
(a) For the period July 24, 2000 to August 31, 2000.
See notes to financial statements.
30
<PAGE> 31
LEADER MUTUAL FUNDS
GROWTH & INCOME FUND
STATEMENTS OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
AUGUST 31, 2000 AUGUST 31, 1999
--------------- ---------------
<S> <C> <C>
CHANGE IN NET ASSETS:
OPERATIONS:
Net investment income..................................... $ 1,601,864 $ 1,356,565
Net realized gains on investments......................... 4,615,701 610,272
Net change in unrealized appreciation on investments...... 18,875,140 30,829,853
------------ ------------
Change in net assets resulting from operations............ 25,092,705 32,796,690
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income..................................... (1,559,669) (1,179,259)
Net realized gains........................................ (732,902) (2,809,929)
------------ ------------
Change in net assets from shareholder distributions....... (2,292,571) (3,989,188)
------------ ------------
FUND SHARE TRANSACTIONS:
Proceeds from sale of shares.............................. 44,731,914 55,582,611
Shares issued in reinvestment of distributions............ 964,670 2,300,629
Payments for shares redeemed.............................. (36,887,953) (14,902,534)
------------ ------------
Change in net assets from fund share transactions......... 8,808,631 42,980,706
------------ ------------
NET INCREASE IN NET ASSETS................................ 31,608,765 71,788,208
------------ ------------
NET ASSETS:
Beginning of period....................................... 145,919,199 74,130,991
------------ ------------
End of period............................................. $177,527,964 $145,919,199
============ ============
SHARE TRANSACTIONS:
Issued.................................................... 1,363,647 2,082,954
Reinvested................................................ 29,650 82,321
Redeemed.................................................. (1,121,361) (520,372)
------------ ------------
Change in shares.......................................... 271,936 1,644,903
============ ============
</TABLE>
See notes to financial statements.
31
<PAGE> 32
LEADER MUTUAL FUNDS
INTERMEDIATE GOVERNMENT BOND FUND
STATEMENTS OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
AUGUST 31, 2000 AUGUST 31, 1999
--------------- ---------------
<S> <C> <C>
CHANGE IN NET ASSETS:
OPERATIONS:
Net investment income..................................... $ 5,253,647 $ 4,407,797
Net realized gains (losses) on investments................ (594,305) 62,312
Net change in unrealized depreciation on investments...... 619,386 (6,124,561)
------------ -----------
Change in net assets resulting from operations............ 5,278,728 (1,654,452)
------------ -----------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income..................................... (5,253,647) (4,406,645)
In excess of net investment income........................ -- (1,152)
------------ -----------
Change in net assets from shareholder distributions....... (5,253,647) (4,407,797)
------------ -----------
FUND SHARE TRANSACTIONS:
Proceeds from sale of shares.............................. 75,132,348 22,721,191
Shares issued in reinvestment of distributions............ 574,323 641,435
Payments for shares redeemed.............................. (25,237,534) (9,308,084)
------------ -----------
Change in net assets from fund share transactions......... 50,469,137 14,054,542
------------ -----------
NET INCREASE IN NET ASSETS................................ 50,494,218 7,992,293
------------ -----------
NET ASSETS:
Beginning of period....................................... 80,606,512 72,614,219
------------ -----------
End of period............................................. $131,100,730 $80,606,512
============ ===========
SHARE TRANSACTIONS:
Issued.................................................... 6,342,963 1,790,846
Reinvested................................................ 48,371 50,162
Redeemed.................................................. (2,131,822) (734,208)
------------ -----------
Change in shares.......................................... 4,259,512 1,106,800
============ ===========
</TABLE>
See notes to financial statements.
32
<PAGE> 33
LEADER MUTUAL FUNDS
TAX-EXEMPT BOND FUND
STATEMENTS OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
JULY 24, 2000 TO
AUGUST 31, 2000(a)
------------------
<S> <C>
CHANGE IN NET ASSETS:
OPERATIONS:
Net investment income....................................... $ 99,413
Net realized gains on investments........................... 114,810
Net change in unrealized appreciation on investments........ 33,323
-----------
Change in net assets resulting from operations.............. 247,546
-----------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income....................................... (99,413)
-----------
Change in net assets from shareholder distributions......... (99,413)
-----------
FUND SHARE TRANSACTIONS:
Proceeds from sale of shares................................ 23,356,386
Payments for shares redeemed................................ (1,243,643)
-----------
Change in net assets from fund share transactions........... 22,112,743
-----------
NET INCREASE IN NET ASSETS.................................. 22,260,876
-----------
NET ASSETS:
Beginning of period......................................... --
-----------
End of period............................................... $22,260,876
===========
SHARE TRANSACTIONS:
Issued...................................................... 2,334,944
Redeemed.................................................... (123,723)
-----------
Change in shares............................................ 2,211,221
===========
</TABLE>
---------------
(a) Period from commencement of operations.
See notes to financial statements.
33
<PAGE> 34
LEADER MUTUAL FUNDS
MONEY MARKET FUND
STATEMENTS OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED JULY 7, 1999 TO
AUGUST 31, 2000 AUGUST 31, 1999(a)
--------------- ------------------
<S> <C> <C>
CHANGE IN NET ASSETS:
OPERATIONS:
Net investment income.................................... $ 10,221,734 $ 1,046,840
Net realized gains (losses) on investments............... 1,203 (1,562)
------------- ------------
Change in net assets resulting from operations........... 10,222,937 1,045,278
------------- ------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income.................................... (10,221,734) (1,046,840)
------------- ------------
Change in net assets from shareholder distributions...... (10,221,734) (1,046,840)
------------- ------------
FUND SHARE TRANSACTIONS:
Proceeds from sale of shares............................. 340,588,905 190,304,944
Shares issued in reinvestment of distributions........... 138,869 52
Payments for shares redeemed............................. (230,877,852) (23,968,439)
------------- ------------
Change in net assets from fund share transactions........ 109,849,922 166,336,557
------------- ------------
NET INCREASE IN NET ASSETS............................... 109,851,125 166,334,995
------------- ------------
NET ASSETS:
Beginning of period...................................... 166,334,995 --
------------- ------------
End of period............................................ $ 276,186,120 $166,334,995
============= ============
SHARE TRANSACTIONS:
Issued................................................... 340,588,905 190,304,944
Reinvested............................................... 138,869 52
Redeemed................................................. (230,877,852) (23,968,439)
------------- ------------
Change in shares......................................... 109,849,922 166,336,557
============= ============
</TABLE>
---------------
(a) Period from commencement of operations.
See notes to financial statements.
34
<PAGE> 35
LEADER MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION AND FUND DESCRIPTION
LEADER Mutual Funds (the "Trust") is an open-end, diversified management
investment company registered under the Investment Company Act of 1940 (the
"Act"), as amended. The Trust was organized as a Massachusetts business trust on
April 28, 1994, and is authorized to issue an unlimited number of shares of
beneficial interest in multiple series. Two series commenced investment
operations on September 1, 1994, the LEADER Growth & Income Fund and the LEADER
Intermediate Government Bond Fund, one series commenced investment operations on
July 7, 1999, the LEADER Money Market Fund, and one series commenced investment
operations on July 24, 2000, the LEADER Tax-Exempt Bond Fund (the "Funds").
On September 1, 2000, the Magna Growth & Income Fund, the Magna Intermediate
Government Bond Fund, the Magna Tax-Exempt Bond Fund and the Magna Money Market
Fund became the LEADER Growth & Income Fund, the LEADER Intermediate Government
Bond Fund, the LEADER Tax-Exempt Bond Fund and the LEADER Money Market Fund,
collectively referred to as the LEADER Mutual Funds.
The investment objective of the LEADER Growth & Income Fund is to seek long-term
growth of capital, current income and growth of income. The investment objective
of the LEADER Intermediate Government Bond Fund is to achieve current income
consistent with preservation of capital. The investment objective of the LEADER
Tax-Exempt Bond Fund is current income that is exempt from federal income tax
consistent with preservation of capital. The investment objective of the LEADER
Money Market Fund is to maximize current income consistent with preservation of
capital and liquidity.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by the
Trust.
Investment Valuation: The variable net asset funds are valued as followed:
Equity securities listed on an established securities exchange or on the NASDAQ
National Market System are valued at the closing sale price on the exchange
where primarily traded or, if there is no reported sale during the day, and in
the case of over-the-counter securities not so listed, at the last bid price.
Long-term debt securities are valued by a pricing service, which determines
valuations of normal institutional-size trading units of long-term debt
securities. Short-term debt securities having a maturity of 60 days or less from
the valuation date are valued at amortized cost which approximates market value.
The Money Market Fund's securities are valued at amortized cost, which
approximates market value. The amortized cost method involves valuing a security
at its cost on the date of purchase and thereafter assuming a constant
amortization to maturity of the difference between the principal amount due at
maturity and cost.
Investment Transactions: All securities transactions are recorded on a trade
date basis. Dividend income is recorded on the ex-dividend date and interest
income is recorded on the accrual basis. Realized gains and losses on sales of
securities are determined on the basis of identified cost.
Repurchase Agreements: A repurchase agreement customarily obligates the seller
at the time it sells securities to the Funds to repurchase the securities at a
mutually agreed upon time and price which, in the case of the Funds'
transactions, is usually within seven days. The total amount received by the
Funds on repurchase agreements is calculated to exceed the price paid by the
Funds, reflecting an agreed upon market rate of interest for the period
35
<PAGE> 36
LEADER MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS, CONTINUED
of time to the settlement date, and will not necessarily be related to the
interest rate on the underlying securities. The underlying securities are
ordinarily United States government securities. Repurchase agreements will be
fully collateralized at all times. However, to the extent that the proceeds from
any sale upon default in the obligation to repurchase is less than the
repurchase price, the Funds would suffer a loss. Also, the Funds might incur
costs and encounter delays in liquidating collateral.
Dividends and Distributions to Shareholders: The LEADER Intermediate Government
Bond Fund, the LEADER Tax-Exempt Bond Fund, and the LEADER Money Market Fund
declare dividends from net investment income daily and make payments monthly.
The LEADER Growth & Income Fund declares and pays dividends from net investment
income quarterly. Each Fund also distributes all of its net capital gains, if
any, on an annual basis, normally in December. Distributions are recorded on the
ex-dividend date. Income distributions and capital gain distributions are
determined in accordance with income tax regulations, which may differ from
generally accepted accounting principles. The differences are primarily due to
differing treatments for mortgage-backed securities, expiring capital loss
carryforwards, and deferrals of certain losses. Permanent book and tax basis
differences have been reclassified among the components of net assets.
Federal Income Taxes: Each Fund of the Trust is treated as a separate entity for
federal tax purposes. Each Fund intends to qualify each year as a regulated
investment company under Subchapter M of the Internal Revenue Code. By so
qualifying, the Funds will not be subject to federal income tax to the extent
that they distribute all of their taxable income, including realized capital
gains, for the fiscal year. In addition, by distributing substantially all of
their net investment income and capital gains during the calendar year, the
Funds will not be subject to a federal excise tax.
Expenses: Expenses that are directly related to one of the Funds are charged
directly to that Fund. Expenses relating to the Funds collectively are prorated
to the Funds on the basis of each Fund's relative net assets.
Estimates: The financial statements have been prepared in conformity with
generally accepted accounting principles which permit management to make certain
estimates and assumptions at the date of the financial statements. Actual
results could differ from those estimates.
3. RELATED PARTY TRANSACTIONS
Each Fund has entered into a separate Investment Advisory Agreement with Union
Planters Bank, N.A. ("UPC"). Under these agreements, each Fund pays a fee,
calculated daily and paid monthly, based on the respective average daily net
assets of such Fund. This fee is 0.75% for the LEADER Growth & Income Fund,
0.50% for the LEADER Intermediate Government Bond Fund, 0.50% for the LEADER
Tax-Exempt Bond Fund, and 0.40% for the LEADER Money Market Fund. UPC has
voluntarily agreed to reduce its fees with respect to the LEADER Growth & Income
Fund to 0.50%, with respect to the LEADER Intermediate Government Bond Fund to
0.40% and with respect to the LEADER Tax-Exempt Bond Fund to 0.30% of daily net
assets through August 31, 2000. Also, UPC has voluntarily agreed to reduce its
fee for the LEADER Money Market Fund to 0.17% of daily net assets through August
31, 2000. This voluntary reduction has been in effect since September 1, 1995
for the LEADER Growth & Income Fund and the LEADER Intermediate Government Bond
Fund; the LEADER Money Market Fund has been in effect since June 1, 1999. For
the year ended August 31, 2000, UPC voluntarily waived investment advisory fees
of $405,620, $83,640, $4,645, and $427,642 for the
36
<PAGE> 37
LEADER MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS, CONTINUED
LEADER Growth & Income Fund, LEADER Intermediate Government Bond Fund, the
LEADER Tax-Exempt Bond Fund, and the LEADER Money Market Fund, respectively.
BISYS Fund Services Limited Partnership d/b/a BISYS Fund Services ("BISYS"), an
Ohio limited partnership, is a subsidiary of The BISYS Group, Inc. BISYS serves
the Trust as distributor, administrator, transfer agent and fund accountant.
Certain officers of the Trust are affiliated with BISYS and such officers are
not paid any fees directly by the Funds for serving as officers of the Trust. As
administrator, BISYS voluntarily waived administrative fees of $55,779 for the
LEADER Money Market Fund for the year ended August 31, 2000.
Each Fund has adopted a Service Plan (the "Plan") pursuant to Rule 12b-1 under
the Investment Company Act of 1940, as amended. The purpose of each plan is to
compensate the Funds' Distributor for expenses borne in connection with the
provision of personal services provided to investors and/or maintenance of
shareholder accounts, at an annual rate not to exceed 0.25% of each Fund's
average daily net assets. For the year ended August 31, 2000, BISYS (the
"Distributor") voluntarily waived the entire 0.25% for each Fund, amounting to
$405,620, $209,104, $5,806, and $464,826 of service fees for the LEADER Growth &
Income Fund, the LEADER Intermediate Government Bond Fund, the LEADER Tax-Exempt
Bond Fund and the LEADER Money Market Fund, respectively.
BISYS is entitled to receive commissions on sales of shares of the Funds for the
year ended August 31, 2000, BISYS received $5,548 of commissions on sales of
shares of the Funds, of which $5,302 was allowed to affiliated broker/dealers of
the Funds.
Each of the Trust's Trustees who are not affiliated with UPC or BISYS receives
an annual fee of $5,000 plus $500 for each meeting attended.
4. INVESTMENT TRANSACTIONS
Purchases and proceeds from sales and maturities of investments, excluding
short-term securities for each Fund for the year ended August 31, 2000 were as
follows:
<TABLE>
<CAPTION>
PURCHASES SALES
----------- -----------
<S> <C> <C>
LEADER Growth & Income Fund................................. $34,210,781 $25,709,719
LEADER Intermediate Government Bond Fund.................... $11,322,969 $11,974,193
LEADER Tax-Exempt Bond Fund................................. $ 4,390,870 $ 1,899,285
</TABLE>
37
<PAGE> 38
LEADER MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS, CONTINUED
The identified cost for federal income tax purposes of investments owned by each
Fund and their respective gross unrealized appreciation and depreciation at
August 31, 2000 were as follows:
<TABLE>
GROSS GROSS NET UNREALIZED
UNREALIZED UNREALIZED APPRECIATION
COST APPRECIATION (DEPRECIATION) (DEPRECIATION)
------------ ----------- ----------- -----------
<S> <C> <C> <C> <C>
Growth & Income Fund.......... $105,629,181 $76,808,371 $(1,732,535) $75,075,836
Intermediate Government Bond
Fund........................ $133,759,107 $ 738,647 $(4,392,198) $(3,653,551)
Tax-Exempt Bond Fund.......... $ 22,600,185 $ 625,016 $ (169,694) $ 455,322
Money Market Fund............. $276,573,103 $ -- $ -- $ --
</TABLE>
5. COMMON TRUST FUND CONVERSION
On July 24, 2000, the Intermediate Government Bond Fund and the Tax-Exempt
Bond Fund issued shares to acquire all of the assets and liabilities of certain
common trust funds of UPBNA. The following is a summary of shares issued, net
assets converted, net asset value per share and unrealized appreciation
(depreciation) as of the conversion date.
<TABLE>
<CAPTION>
NET ASSET UNREALIZED
VALUE APPRECIATION
SHARES NET ASSETS PER SHARE (DEPRECIATION)
--------- ----------- --------- --------------
<S> <C> <C> <C> <C>
Intermediate Government Bond Fund...... 4,654,176 $55,151,984 $11.85 $(908,413)
Tax-Exempt Bond Fund................... 1,965,722 $19,657,220 $10.00 $ 421,999
</TABLE>
6. FEDERAL INCOME TAX INFORMATION (UNAUDITED)
At August 31, 2000, the following funds had net capital loss carryforwards
to offset future net capital gains, if any, to the extent provided by the
Treasury regulations. To the extent that these carryovers are used to offset
future capital gains, it is probable that the gains so offset will not be
distributed to shareholders:
<TABLE>
<S> <C> <C>
Intermediate Government Bond Fund.......................... $ 96,095 Expires 2004
7,256 Expires 2008
--------
103,351
========
Money Market Fund.......................................... $ 359 Expires 2008
</TABLE>
During the year ended August 31, 2000, the following funds declared
long-term capital gain distributions as follows:
<TABLE>
<S> <C>
Growth and Income Fund...................................... $732,902
</TABLE>
38
<PAGE> 39
LEADER MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS, CONTINUED
Under current tax law, capital losses realized after October 31 may be
deferred and treated as occurring on the first business day of the following
fiscal year. The following funds had deferred losses, which will be treated as
arising on the first day of the fiscal year ending August 31, 2000:
<TABLE>
<CAPTION>
FUND CAPITAL LOSS DEFERRED
---- ---------------------
<S> <C>
Intermediate Government Bond Fund........................... $587,050
</TABLE>
39
<PAGE> 40
LEADER MUTUAL FUNDS
GROWTH & INCOME FUND
FINANCIAL HIGHLIGHTS
Selected data for a share of beneficial interest outstanding throughout the
period indicated:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED
AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31,
2000 1999 1998 1997 1996
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE -- BEGINNING OF PERIOD........... $ 30.37 $ 23.46 $ 22.18 $ 16.42 $ 14.05
-------- -------- ------- ------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income............................ 0.32 0.30 0.23 0.26 0.24
Net realized and unrealized gains on
investments.................................... 4.75 7.53 1.72 6.12 2.39
-------- -------- ------- ------- -------
Total income from investment operations.......... 5.07 7.83 1.95 6.38 2.63
-------- -------- ------- ------- -------
LESS DISTRIBUTIONS:
Net investment income............................ (0.32) (0.27) (0.25) (0.25) (0.23)
Net realized gain from investments............... (0.15) (0.65) (0.42) (0.37) (0.03)
-------- -------- ------- ------- -------
Total dividends and distributions................ (0.47) (0.92) (0.67) (0.62) (0.26)
-------- -------- ------- ------- -------
NET ASSET VALUE -- END OF PERIOD................. $ 34.97 $ 30.37 $ 23.46 $ 22.18 $ 16.42
======== ======== ======= ======= =======
Total return(a).................................. 16.80% 33.73% 8.84% 39.59% 18.77%
RATIOS AND SUPPLEMENTAL DATA:
Net assets, at end of period ($000's)............ $177,528 $145,919 $74,131 $70,276 $39,995
Ratio of expenses to average net assets.......... 0.82% 0.87% 0.99% 1.06% 1.27%
Ratio of net investment income to average net
assets......................................... 0.99% 1.05% 0.96% 1.36% 1.56%
Ratio of expenses to average net assets without
fee waivers(b)................................. 1.32% 1.37% 1.49% 1.56% 1.77%
Ratio of net investment income to average net
assets without fee waivers(b).................. 0.49% 0.55% 0.46% 0.86% 1.06%
Portfolio turnover rate.......................... 17% 9% 26% 17% 31%
</TABLE>
--------------------------------------------------------------------------------
(a) Total return excludes sales charges. Had the advisor, distributor and
administrator not reduced or waived certain expenses, total returns would
have been lower.
(b) During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
See notes to financial statements.
40
<PAGE> 41
LEADER MUTUAL FUNDS
INTERMEDIATE GOVERNMENT BOND FUND
FINANCIAL HIGHLIGHTS
Selected data for a share of beneficial interest outstanding throughout the
period indicated:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED
AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31,
2000 1999 1998 1997 1996
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE -- BEGINNING OF PERIOD........... $ 12.04 $ 13.00 $ 12.61 $ 12.43 $ 12.75
-------- ------- ------- ------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income............................ 0.74 0.72 0.76 0.79 0.76
Net realized and unrealized gains (losses) on
investments.................................... (0.07) (0.96) 0.39 0.19 (0.32)
-------- ------- ------- ------- -------
Total income from investment operations.......... 0.67 (0.24) 1.15 0.98 0.44
-------- ------- ------- ------- -------
LESS DISTRIBUTIONS:
Net investment income............................ (0.74) (0.72) (0.76) (0.79) (0.76)
In excess of net investment income............... -- -- -- (0.01) --
-------- ------- ------- ------- -------
Total dividends and distributions................ (0.74) (0.72) (0.76) (0.80) (0.76)
-------- ------- ------- ------- -------
NET ASSET VALUE -- END OF PERIOD................. $ 11.97 $ 12.04 $ 13.00 $ 12.61 $ 12.43
======== ======= ======= ======= =======
Total return(a).................................. 5.86% (1.97%) 9.33% 7.96% 3.48%
RATIOS AND SUPPLEMENTAL DATA:
Net assets, at end of period ($000's)............ $131,101 $80,607 $72,614 $64,459 $56,764
Ratio of expenses to average net assets.......... 0.79% 0.82% 0.90% 0.96% 1.05%
Ratio of net investment income to average net
assets......................................... 6.28% 5.69% 5.92% 6.15% 5.97%
Ratio of expenses to average net assets without
fee waivers(b)................................. 1.14% 1.17% 1.25% 1.31% 1.40%
Ratio of net investment income to average net
assets without fee waivers(b).................. 5.93% 5.34% 5.57% 5.80% 5.62%
Portfolio turnover rate.......................... 14% 16% 32% 19% 20%
</TABLE>
--------------------------------------------------------------------------------
(a) Total return excludes sales charges. Had the advisor, distributor and
administrator not reduced or waived certain expenses, total returns would
have been lower.
(b) During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
See notes to financial statements.
41
<PAGE> 42
LEADER MUTUAL FUNDS
TAX-EXEMPT BOND FUND
FINANCIAL HIGHLIGHTS
Selected data for a share of beneficial interest outstanding throughout the
period indicated:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
JULY 24, 2000*
THROUGH
AUGUST 31,
2000
--------------
<S> <C>
NET ASSET VALUE -- BEGINNING OF PERIOD...................... $ 10.00
-------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income....................................... 0.05
Net realized and unrealized gains (losses) on investments... 0.07
-------
Total income from investment operations..................... 0.12
-------
LESS DISTRIBUTIONS:
Net investment income....................................... (0.05)
-------
Total dividends and distributions........................... (0.05)
-------
NET ASSET VALUE -- END OF PERIOD............................ $ 10.07
=======
Total return(a)............................................. 1.16%(c)
RATIOS AND SUPPLEMENTAL DATA:
Net assets, at end of period ($000's)....................... $22,261
Ratio of expenses to average net assets..................... 0.87%(d)
Ratio of net investment income to average net assets........ 4.26%(d)
Ratio of expenses to average net assets without fee
waivers(b)................................................ 1.32%(d)
Ratio of net investment income to average net assets without
fee waivers(b)............................................ 3.81%(d)
Portfolio turnover rate..................................... 9%
</TABLE>
--------------------------------------------------------------------------------
* Commencement of operations.
(a) Total return excludes sales charges. Had the advisor, distributor and
administrator not reduced or waived certain expenses, total returns would
have been lower.
(b) During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(c) Not annualized.
(d) Annualized.
See notes to financial statements.
42
<PAGE> 43
LEADER MUTUAL FUNDS
MONEY MARKET FUND
FINANCIAL HIGHLIGHTS
Selected data for a share of beneficial interest outstanding throughout the
period indicated:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR JULY 7, 1999*
ENDED THROUGH
AUGUST 31, AUGUST 31,
2000 1999
---------- -------------
<S> <C> <C>
NET ASSET VALUE -- BEGINNING OF PERIOD...................... $ 1.000 $ 1.000
-------- --------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income....................................... 0.055 0.007
-------- --------
Total income from investment operations..................... 0.055 0.007
-------- --------
LESS DISTRIBUTIONS:
Net investment income....................................... (0.055) (0.007)
-------- --------
Total dividends and distributions........................... (0.055) (0.007)
-------- --------
NET ASSET VALUE -- END OF PERIOD............................ $ 1.000 $ 1.000
======== ========
Total return(a)............................................. 5.60% 0.67%(c)
RATIOS AND SUPPLEMENTAL DATA:
Net assets, at end of period ($000's)....................... $276,186 $166,335
Ratio of expenses to average net assets..................... 0.51% 0.51%(d)
Ratio of net investment income to average net assets........ 5.50% 4.35%(d)
Ratio of expenses to average net assets without fee
waivers(b)................................................ 1.02% 1.02%(d)
Ratio of net investment income to average net assets without
fee waivers(b)............................................ 4.99% 3.84%(d)
</TABLE>
--------------------------------------------------------------------------------
* Commencement of operations.
(a) Had the advisor, distributor and administrator not reduced or waived certain
expenses, total returns would have been lower.
(b) During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(c) Not annualized.
(d) Annualized.
See notes to financial statements.
43
<PAGE> 44
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Trustees of the LEADER Mutual Funds
In our opinion, the accompanying statement of assets and liabilities,
including the schedules of portfolio investments, and the related statements of
operations and of changes in net assets and the financial highlights present
fairly, in all material respects, the financial position of the LEADER Growth &
Income Fund, LEADER Intermediate Government Bond Fund, LEADER Tax-Exempt Bond
Fund, and LEADER Money Market Fund (separate portfolios constituting the LEADER
Mutual Funds, formerly known as the Magna Funds, hereafter referred to as the
"Funds") at August 31, 2000, the results of each of their operations for the
period then ended, the changes in each of their net assets for the periods
presented and the financial highlights for each of the periods presented, in
conformity with accounting principles generally accepted in the United States of
America. These financial statements and financial highlights (hereafter referred
to as "financial statements") are the responsibility of the Funds' management;
our responsibility is to express an opinion on these financial statements based
on our audits. We conducted our audits of these financial statements in
accordance with auditing standards generally accepted in the United States of
America, which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities at August 31, 2000 by
correspondence with the custodian and brokers, provide a reasonable basis for
the opinion expressed above.
PricewaterhouseCoopers LLP
Columbus, Ohio
October 18, 2000
44
<PAGE> 45
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<PAGE> 46
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE> 47
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE> 48
INVESTMENT ADVISER
Union Planters Bank, National Association
One South Church Street
Suite 500
Belleville, Illinois 62220
ADMINISTRATOR & DISTRIBUTOR
BISYS Fund Services, L.P.
3435 Stelzer Road
Columbus, Ohio 43219
TRANSFER AND DIVIDEND PAYING AGENT
BISYS Fund Services, Inc.
3435 Stelzer Road
Columbus, Ohio 43219
CUSTODIAN
Union Planters Bank, National Association
One South Church Street
Suite 500
Belleville, Illinois 62220
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP
100 East Broad Street
Columbus, Ohio 43215
LEGAL COUNSEL
Ropes & Gray
One International Place
Boston, Massachusetts 02110
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Letter to Shareholders..................... 1
Portfolio Manager Report................... 2
Schedule of Portfolio Investments.......... 8
Statements of Assets and Liabilities....... 29
Statements of Operations................... 30
Statements of Changes in Net Assets........ 31
Notes to Financial Statements.............. 35
Financial Highlights....................... 40
Report of Independent Accountants.......... 44
</TABLE>
QUESTIONS?
Call 1-800-219-4182 or your investment representative.
Leader Mutual Funds Logo
LEADER GROWTH &
INCOME FUND
LEADER INTERMEDIATE
GOVERNMENT BOND
FUND
LEADER TAX-EXEMPT
BOND FUND
LEADER MONEY
MARKET FUND
---------------
ANNUAL REPORT
AUGUST 31, 2000
---------------
BISYS FUND SERVICES IS THE DISTRIBUTOR FOR THE LEADER MUTUAL FUNDS. THIS
MATERIAL MUST BE PRECEDED OR ACCOMPANIED BY A PROSPECTUS.
