<PAGE>
[LOGO]
Annual Report
Jurika & Voyles Fund Group
Mini-Cap Fund
Value+Growth Fund
Balanced Fund
June 30, 1999
<PAGE>
Table of Contents
<TABLE>
<S> <C>
.............................................................
Letter to Shareholders 1
.............................................................
Performance
..........................................................
Mini-Cap Fund 3
..........................................................
Value+Growth Fund and Balanced Fund (equity 6
portion)
..........................................................
Balanced Fund (fixed income portion) 11
.............................................................
Schedule of Investments 13
.............................................................
Statements of Assets and Liabilities 28
.............................................................
Statements of Operations 29
.............................................................
Statements of Changes in Net Assets 30
.............................................................
Financial Highlights 33
.............................................................
Notes to Financial Statements 36
</TABLE>
DIRECTORY OF FUNDS' SERVICE PROVIDERS
INVESTMENT ADVISER
Jurika & Voyles, L.P., Oakland, CA
DISTRIBUTOR
First Fund Distributors, Inc., Phoenix, AZ
CUSTODIAN, TRANSFER AGENT AND FUND ACCOUNTANT
State Street Bank & Trust Co., Boston, MA
LEGAL COUNSEL
Paul, Hastings, Janofsky & Walker LLP, San Francisco, CA
AUDITOR
McGladrey & Pullen, LLP, New York, NY
THIS REPORT IS AUTHORIZED FOR DISTRIBUTION TO SHAREHOLDERS AND TO OTHERS ONLY
WHEN PRECEDED OR ACCOMPANIED BY A CURRENT PROSPECTUS FOR JURIKA & VOYLES FUND
GROUP.
<PAGE>
Letter to Shareholders
DEAR SHAREHOLDER:
This report provides an investment review and outlook, along with a summary of
key financial and performance information, for each Fund of the Jurika & Voyles
Fund Group for the fiscal year ended June 30, 1999.
As always, we stand ready to serve you. If you have any questions, please do not
hesitate to call our Investor Center at (800) JV-INVST (800-584-6878).
Thank you for your continued support.
Very truly yours,
/s/ William K. Jurika /s/ Glenn C. Voyles
- -------------------------------------- ------------------------
William K. Jurika Glenn C. Voyles
1
<PAGE>
<PAGE>
PERFORMANCE
-------------------------------------------------
Mini-Cap Fund
Review and Outlook
- ------------------
In reviewing the last twelve months for the Fund and the US equity markets, the
opening lines from A TALE OF TWO CITIES seemed to fit the period quite well. The
past year truly has been a period of extremes and a great example of the "best
of times" and the "worst of times." From June 1998 to early October equity
markets around the world seemed to collapse with the fears surrounding Asia, the
Russian economy, and the fate of Long Term Capital. In the US, the Russell 2000
Index declined more than 30% during this period as investors worried about the
effects of a global meltdown. This decline in share prices during September and
early October was rivaled only by the "Crash of 1987," and can aptly be termed
"the worst of times."
Then, just as abruptly, the equity markets began a remarkable recovery. On the
heels of three separate interest rate cuts by the Federal Reserve, the Russell
2000 climbed 16.5% in the December quarter, and managed to finish the year with
a relatively small loss. In addition, during the last months of 1998 and into
1999 the share prices of many internet-related companies soared. Some of these
stocks doubled, tripled and then doubled again as investors could not get enough
exposure to this new and growing sector of the economy.
In early April, the equity markets began a long anticipated (and much
appreciated) broadening out as investors renewed their interest in stocks other
than the top 50 names in the S&P 500. Investors once again began looking at (and
buying) companies in the mid- and small-cap sectors of the market. As a result,
the Russell 2000 fared very well over the course of the June 1999 quarter. The
Russell 2000 enjoyed a gain of 15.5% versus only 7.0% for the S&P 500. This
resurgence of smaller-cap stocks in the past few months has become the "best of
times" for many investors and money managers who had nearly forgotten what
"outperformance" felt like.
During the Fund's fiscal year ended June 30, it suffered alongside the Russell
2000 through the sharp drop during the September 1998 quarter. It enjoyed a very
nice recovery in October and early November, but investments in the energy and
producer durable sectors, along with a few poor-performing health care issues,
resulted in a significant underperformance during the last weeks of the year.
The Fund's tilt toward value-oriented investments likewise hurt performance in
the early months of 1999. During the March quarter, the
3
<PAGE>
PERFORMANCE
-------------------------------------------------
MINI-CAP FUND
only sector in the small-cap arena that performed well was the networking
sector, and this performance was due almost entirely to the popularity of a few
internet issues. The Fund had very little exposure to this sector during the
quarter and as such did not benefit from the extreme valuations being given to
these stocks.
During February and March, the Fund's assets were shifted away from some of the
deeper-value names and allocated into some growth-oriented issues (primarily
technology and consumer growth issues). At the time small-cap growth issues in
general were still extremely undervalued, and we felt they offered more promise
of near-term rewards for the Fund. As the market began to broaden out in early
April the Fund was extremely well positioned. As investors moved back into the
mid- and small-cap sectors and away from the top names in the S&P 500, many of
the larger positions in the Fund performed extremely well. The June 1999 quarter
was a very good time for the Fund. Issues such as Conextant, Laser Vision
Centers, Trex Systems, and Netopia more than doubled, and the Fund enjoyed a
22.9% gain, outperforming the Russell 2000 index for the quarter by 7.4%.
Currently, the Fund continues to perform well. We feel strongly that the recent
move by the smaller-cap sector of the market is only the beginning, and that
this trend should last for many more quarters.
4
<PAGE>
PERFORMANCE
-------------------------------------------------
MINI-CAP FUND
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
LIPPER ANALYTICAL SERVICES,
JURIKA & VOYLES INC. RUSSELL 2000
MINI-CAP FUND SMALL COMPANY FUND INDEX INDEX
<S> <C> <C> <C>
9/30/94 $10,000.00 $10,000.00 $10,000.00
12/31/94 10,650.00 9,985.97 9,812.98
3/31/95 11,832.22 10,546.69 10,285.38
6/30/95 14,146.57 11,523.96 11,227.62
9/30/95 15,509.13 12,964.56 12,336.47
12/31/95 16,210.44 13,143.67 12,603.61
3/31/96 17,690.90 13,885.16 13,249.83
6/30/96 19,586.73 14,987.34 13,909.53
9/30/96 19,948.86 15,176.36 13,956.63
12/31/96 21,423.66 15,031.64 14,682.72
3/31/97 20,270.07 13,616.08 13,923.33
6/30/97 23,983.50 15,931.33 16,180.46
9/30/97 29,319.66 18,360.20 18,588.47
12/31/97 26,536.65 17,289.11 17,965.89
3/31/98 28,668.48 19,145.16 19,772.97
6/30/98 26,452.56 18,403.68 18,850.96
9/30/98 19,957.14 14,466.24 10,052.75
12/30/98 22,736.67 17,141.36 17,508.44
3/31/99 20,715.64 16,331.92 16,558.60
6/30/99 25,452.44 18,756.95 19,133.09
Annualized One Year
Since Inception Total Return
Total Returns for Period Ended June 30, 1999
Jurika & Voyles MiniCap Fund 21.73% -3.78%
Lipper Analytical Services, Inc., Small Company Fund
Index 14.16% 1.92%
Russell 2000 Index 14.63% 1.50%
</TABLE>
This graph is furnished to you in accordance with SEC regulations. It compares a
$10,000 investment in Jurika & Voyles Mini-Cap Fund with a similar investment in
the Lipper Analytical Services, Inc., Small Company Fund Index and the Russell
2000 Index from the inception of the Fund on September 30, 1994 through June 30,
1999. For purposes of the graph and the Fund's Annualized Return Since Inception
and One Year Total Return, it has been assumed that all recurring fees
(including management fees) were deducted and all distributions were reinvested.
Total return of the Fund reflects the fact that fees and expenses in excess of
certain limits specified in the investment management agreement have been
assumed by Jurika & Voyles, L.P.
Lipper Analytical Services, Inc., Small Company Fund Index is an unmanaged, net
asset value weighted index of 30 mutual funds that invest primarily in companies
with small market capitalization. Russell 2000 Index is a widely regarded
small-cap index of the 2,000 smallest securities of the Russell 3000 Index which
comprises the 3,000 largest U.S. securities as determined by total market
capitalization.
Each index reflects the reinvestment of income dividends and capital gains
distributions, if any, but does not reflect fees, brokerage commissions, or
other expenses of investing. It is not possible to invest directly in an index.
All results are historical. Past performance is no guarantee of future results.
5
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PERFORMANCE
-------------------------------------------------
Value+Growth Fund and Balanced Fund (EQUITY PORTION)
Review
- ------
The bull market remains intact! The S&P 500 posted its fifth consecutive year of
20%+ growth, rising 21.1% for the twelve months ended June 30, 1999. The average
annual return for the S&P over the last five years was 25.3%.
The last year was, however, a challenge to the animal spirit of the rampant
bull. In contrast to the previous four years, interest rates and earnings, the
two primary drivers of equity markets, were uncooperative. The long term trend
of falling interest rates, which was in place from June 1994 to June 1998 (as
yields on the 30-year Government bond fell from 7.6% to 5.6%), was interrupted
by a back up of the yield to 6.0% over the last year. Similarly S&P 500
operating earnings which had surged ahead by 12.7% per year from June 1994 to
June 1998, driven by increasing efficiency and a buoyant economy slowed
dramatically to post a meager 2% (estimated) increase over the last year.
If interest rates and corporate earnings did not drive the market, what did? The
main fuels for the market over the last year have been liquidity and
increasingly positive investor sentiment. In retrospect, the "liquidity" crisis
of September 1998 (remember the Latin American currency concerns and the Russian
debt default) seems to be regarded as a "stress test." The supply of liquidity
provided by the Federal Reserve revived consumer and investor sentiment, and the
strength of the US economy helped to drive the rest of the world towards
recovery.
During the first three quarters of the June 1999 year, investors were
preoccupied with predictability. No price appeared too high for companies with
"ruler" earnings and no price too cheap for companies with "problems." This
preoccupation, combined with the difficult earnings environment, led to an
increasingly narrow leadership of the market over these three quarters.
Predictable large-cap growth stocks soared, even as the rest of the market
languished. The table below sets out relative performance, based on valuation
(the PE or price earnings ratio) and size for the 9 months, and clearly
illustrates the market action.
- ----------------------------------------------------------------
6
<PAGE>
PERFORMANCE
-------------------------------------------------
VALUE+GROWTH FUND AND BALANCED FUND (EQUITY PORTION)
S&P 500 Relative Performance by Quintile 6/30/98 to 3/31/99
<TABLE>
<CAPTION>
Valuation
Quintiles Size (PE)
- --------------------------------------------------------- --------- -------------
<S> <C> <C>
1st (smallest/least expensive)........................... -39.7 -46.6
2nd...................................................... -31.2 -25.8
3rd...................................................... -22.3 -11.7
4th...................................................... -7.4 2.9
5th (largest/most expensive)............................. 10.5 13.9
</TABLE>
- --------------------------------------------------------------------------------
For several quarters we have commented on the market's emphasis on momentum and
size, its apparent disregard for valuation, and the extreme disparities (and
opportunities) being generated by the outperformance of the large, highly valued
companies with strong near term price and earnings trends. Our common sense,
businessman's approach to investing means that stock selection is driven by the
value of the cash flows generated by the businesses in which we invest, relative
to the current prices.
The bad news is that the portfolio was not well positioned for performance in
the first three quarters of the June 1999 year. We were not exposed to the
large, high-PE companies which led the market. The good news is that market
sentiment changed dramatically in the June 1999 quarter. Small stocks began
outperforming large, and value stocks began outperforming growth.
The precondition for the change of leadership was the valuation disparities,
which were extreme both for the valuation of small stocks versus large and for
more cyclical value stocks versus growth stocks.
The catalyst for the change of leadership was emerging evidence that global and
US growth were significantly stronger than expected. The expectation for
stronger economic growth was reflected in more positive earnings expectations
for a broad variety of companies. The narrow group of growth stocks suddenly had
relatively poor earnings growth compared to the much wider range of more
cyclical companies.
The long and dramatic underperformance of the value stocks suggested to
investors that the outperformance of value stocks may be very significant,
causing a stampede by investors into the most leveraged sectors.
7
<PAGE>
PERFORMANCE
-------------------------------------------------
VALUE+GROWTH FUND AND BALANCED FUND (EQUITY PORTION)
Another important catalyst for the performance of value stocks has been the high
level of takeover activity as larger companies took advantage of the extreme
undervaluation of smaller businesses.
The portfolio outperformed the major indices in the fourth quarter, although
meaningfully underperformed the S&P 500 over the year due to the trends in the
first three quarters.
- ----------------------------------------------------------------
<TABLE>
<CAPTION>
6/30/98 3/31/99 6/30/98
Total Return to 3/31/99 to 6/30/99 to 6/30/99
- --------------------------------------------- ----------- ------------- -----------
<S> <C> <C> <C>
Value+Growth Fund............................ -3.3% 9.6% 6.0%
S&P 500...................................... 14.7% 7.0% 22.8%
</TABLE>
- --------------------------------------------------------------------------------
Outlook
- -------
The near term economic outlook, both domestically and globally, is positive, and
we agree that the near term earnings outlook has clearly improved over the last
quarter. The valuation argument for smaller and more cyclical companies remains
intact, and we believe the rotation from mega-cap to smaller companies and from
growth to value will be sustained--perhaps for several years.
Where we disagree with the market is the perception of the duration of the
economic recovery and the risk of the market. While the near term trends are
clearly positive, we find little evidence to believe they will be long lasting.
The US economic recovery is already mature (8 years), and we see longer-term
obstacles to growth in both Japan and Europe.
Our view is also that market risk is high. Valuations are at high levels, and
the market's advance in the face of rising interest rates has increased our
concern. Profitability and returns on equity are also at historically high
levels.
We believe the market's focus on the highly leveraged cyclical companies, which
led the market over the June 1999 quarter, is misplaced. Our emphasis is to own
quality companies with strong business models--sustainable returns, strong cash
flow generation and strong financial positions--which sell at material discounts
to our assessment of their values.
We currently find good opportunities in the energy and technology sectors. We
believed
8
<PAGE>
PERFORMANCE
-------------------------------------------------
VALUE+GROWTH FUND AND BALANCED FUND (EQUITY PORTION)
that the level of energy prices in the first quarter of 1999 was unsustainably
low and that many energy stocks were undervalued based on asset values and the
normalized earnings power which we believed that the companies would earn over
the coming energy price cycle. We also are enthusiastic about the prospects of
companies which are at the leading edge of providing energy products and
services in the progressively deregulated global environment.
We continue to be believers in the strong outlook for technology spending. The
pressure on companies to control costs is only increasing, driving spending on
technology which improves efficiency. The outlook for companies exposed to data
storage is particularly positive. We also find the business models of
transaction-based technology companies to be particularly attractive.
9
<PAGE>
PERFORMANCE
-------------------------------------------------
VALUE+GROWTH FUND
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
LIPPER ANALYTICAL
LIPPER ANALYTICAL SERVICES, INC.
JURIKA & VOYLES SERVICES, INC. S&P 500 CAPITAL APPRECIATION
VALUE+GROWTH FUND GROWTH FUND INDEX INDEX FUND INDEX
<S> <C> <C> <C> <C>
9/30/94 10,000.00 10,000.00 10,000.00 10,000.00
12/31/94 10,559.00 9,888.09 9,998.63 9,857.56
3/31/95 11,210.17 10,602.78 10,972.04 10,545.05
6/30/95 12,843.11 11,737.26 12,018.92 11,531.70
9/30/95 13,754.75 12,803.95 12,974.34 12,668.26
12/31/95 13,525.34 13,116.74 13,755.62 12,972.01
3/31/96 13,946.03 13,707.62 14,493.40 13,686.71
6/30/96 14,398.28 14,160.92 15,141.73 14,289.90
9/30/96 14,829.49 14,570.72 15,609.82 14,636.57
12/31/96 16,272.08 15,416.34 16,911.71 14,912.16
3/31/97 16,389.21 15,358.60 17,364.58 14,237.98
6/30/97 19,060.22 17,784.66 20,398.41 16,427.09
9/30/97 20,993.35 19,607.46 21,928.11 18,324.23
12/30/97 19,776.48 19,738.11 22,558.52 17,889.63
3/31/98 21,876.17 22,181.48 25,705.46 20,176.64
6/30/98 21,259.38 28,811.51 26,554.00 20,517.65
9/30/98 18,096.72 20,208.54 23,912.92 17,573.23
12/31/98 20,986.53 24,808.80 29,009.01 21,464.64
3/31/99 20,565.40 26,067.56 30,452.96 22,495.83
6/30/99 22,544.73 27,759.21 32,602.20 24,678.72
Annualized One Year
Since Inception Total Return
Total Returns for Period Ended June 30, 1999
Jurika & Voyles Value+Growth Fund 18.66% 6.05%
Lipper Analytical Services, Inc., Growth Fund Index 23.98% 21.69%
Lipper Analytical Services, Inc., Cap Apprec. Fund
Index 20.94% 20.28%
S&P 500 Index 28.24% 22.78%
</TABLE>
This graph is furnished to you in accordance with SEC regulations. It compares a
$10,000 investment in Jurika & Voyles Value+Growth Fund with a similar
investment in the Lipper Analytical Services, Inc., Growth Fund Index, the
Lipper Analytical Services, Inc., Capital Appreciation Fund Index and the S&P
500 Index from the inception of the Fund on September 30, 1994 through June 30,
1999. For purposes of the graph and the Fund's Annualized Return Since Inception
and One Year Total Return, it has been assumed that all recurring fees
(including management fees) were deducted and all distributions were reinvested.
Total return of the Fund reflects the fact that fees and expenses in excess of
certain limits specified in the investment management agreement have been
assumed by Jurika & Voyles, L.P.
Lipper Analytical Services, Inc., Growth Fund Index is an unmanaged, net asset
value weighted index of 30 mutual funds that invest primarily in companies of
all market capitalization with potential for growth. Lipper Analytical Services,
Inc., Capital Appreciation Fund Index is an unmanaged, net asset value weighted
index of 30 mutual funds that invests primarily in companies of all market
capitalization with an emphasis on maximum capital appreciation. S&P 500 Index
contains 500 industrial, transportation, utility and financial companies
regarded as generally representative of the U.S. stock market.
Each index reflects the reinvestment of income dividends and capital gains
distributions, if any, but does not reflect fees, brokerage commissions, or
other expenses of investing. It is not possible to invest directly in an index.
All results are historical. Past performance is no guarantee of future results.
10
<PAGE>
PERFORMANCE
-------------------------------------------------
Balanced Fund (FIXED INCOME PORTION)
Review
- -----------
The fixed income markets experienced quite a roller-coaster ride over the last
year. In June of 1998 we were experiencing a very healthy domestic economy and
stable international economic activity with the standout exception of a weak
Asian outlook. Interest rates were at attractive levels as evidenced by the long
Treasury Bond yielding about 5.59%.
However, in late summer this stable state of affairs was rocked markedly by the
Russian default on their debt payments, and financial market conditions became
quite unsettled. It seemed like overnight the mood of our domestic bond market
changed. We experienced a world-wide flight to the quality of US Treasury
securities, which lowered the yield on the long Treasury Bond to 4.84% by early
fall. We also experienced the largest widening of spreads, particularly
corporate spreads, since the last recession. The Federal Reserve responded to
these events by quickly lowering the Discount Rate from 5.50% to 4.75% and
providing ample liquidity to stabilize the markets.
Since that time we have experienced both continued domestic economic growth and
a surprising degree of insulation from the slow Asian economy. The strength of
our domestic economy and actions by the Fed have most recently driven the
behavior of the bond market.
Domestic economic strength, as well as a jump in the Consumer Price Index that
reflected the recent increase in oil prices, has begun to fuel fear of potential
inflation. The Federal Reserve announced at its June 30 FOMC meeting that it was
tightening monetary policy by raising short-term rates, in a move to fight
ANTICIPATED inflation. However, actual inflation has thus far been a phantom
menace, and our view is that the outlook for inflation remains benign, though we
may see an occasional uptick based on isolated bottlenecks.
Outlook
- ------------
Interest rates, as represented by the current 30-year Treasury bond, ended June
1999 at 6.15%, more than half a percentage point higher than at the start of the
fiscal year and more than 1.3% higher than the lowest level for the year. We see
very few reasons for the Fed to lower rates in the near future, but we are
expecting to see isolated upticks in rates for the remainder of the year. We
have taken advantage of these markets by increasing exposure to corporate bonds
and decreasing exposure to Agency and Treasury securities. We have also lowered
the overall duration of the portfolio.
11
<PAGE>
PERFORMANCE
-------------------------------------------------
BALANCED FUND
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
LIPPER ANALYTICAL 60% S&P 500/40%
JURIKA & VOYLES SERVICES, INC. LEHMAN BROS. GOV'T/CORP.
BALANCED FUND BALANCED INDEX INT. BOND INDEX
<S> <C> <C> <C>
3/9/1992 $10,000.00 $10,000.00 $10,000.00
3/31/1992 9,940.00 10,000.00 9,994.00
6/30/1992 10,162.22 10,160.14 10,267.65
9/30/1992 10,720.09 10,480.31 10,644.35
12/31/1992 11,546.81 10,874.08 10,948.78
3/31/1993 12,118.07 11,385.86 11,410.36
6/30/1993 12,332.58 11,618.71 11,544.52
9/30/1993 13,060.30 12,043.95 11,828.48
12/31/1993 13,512.35 12,173.77 12,001.20
3/30/1994 13,330.45 11,802.42 11,632.53
6/30/1994 13,215.63 11,712.79 11,635.42
9/30/1994 13,544.18 12,055.59 12,015.50
12/31/1994 13,215.67 11,924.66 12,011.58
3/30/1995 14,142.31 12,644.48 12,921.56
6/30/1995 15,573.18 13,529.48 13,917.05
9/30/1995 16,480.13 14,255.83 14,670.15
12/31/1995 16,573.75 14,892.39 15,407.29
3/30/1996 17,049.65 15,225.74 15,847.53
6/30/1996 17,528.65 15,534.66 16,311.86
9/30/1996 17,966.57 15,944.13 16,738.79
12/31/1996 19,139.60 16,836.16 17,742.23
3/31/1997 19,536.18 16,914.86 18,027.28
6/30/1997 21,580.67 18,738.03 20,101.52
9/30/1997 22,996.70 19,941.95 21,237.20
12/31/1997 22,331.31 20,253.50 21,795.81
3/31/1998 23,682.37 21,855.69 23,738.30
6/30/1998 23,513.60 22,188.00 24,391.67
9/30/1998 21,847.54 20,903.90 23,398.82
12/31/1998 23,949.00 23,309.04 26,345.01
3/31/1999 23,589.66 23,683.03 27,112.35
6/30/1999 24,780.00 24,747.46 28,214.93
Annualized One Year
Total Returns for Period Ended June 30, 1999 Since Inception Total Return
Jurika & Voyles Balanced Fund 13.21% 5.39%
Lipper Analytical Services, Inc., Balanced Fund Index 13.31% 11.54%
60% S&P 500/40% Lehman Bros. Gov't/Corp. Int. Bond Index 15.24% 15.67%
</TABLE>
This graph is furnished to you in accordance with SEC regulations. It compares a
$10,000 investment in Jurika & Voyles Balanced Fund with a similar investment in
a model index consisting of 60% Standard & Poor's ("S&P") 500 Index and 40%
Lehman Brothers Government/Corporate Intermediate Bond Index, and Lipper
Analytical Services, Inc., Balanced Fund Index from the inception of the Fund on
March 9, 1992 through June 30, 1999. For purposes of the graph and the Fund's
Annualized Total Return Since Inception and the One Year Total Return, it has
been assumed that all recurring fees (including management fees) were deducted
and all distributions were reinvested.
Total returns of the Fund reflect the fact that fees and expenses in excess of
certain limits specified in the investment management agreement have been
assumed by Jurika & Voyles, L.P.
The S&P 500 Index is an unmanaged index containing 500 industrial,
transportation, utility and financial companies regarded as generally
representative of the U.S. stock market. The Lehman Brothers
Government/Corporate Intermediate Bond Index is an unmanaged market-weighted
index consisting of public obligations of the U.S. Government, its agencies and
instrumentalities and all corporate issuers of fixed rate, non-convertible,
investment grade U.S. dollar denominated bonds having maturities of one to ten
years. It is generally regarded as representative of the market for
intermediate-term domestic bonds. Lipper Analytical Services, Inc., Balanced
Fund Index is an unmanaged, net asset value weighted index of 30 balanced mutual
funds.
Each index reflects the reinvestment of income dividends and capital gains
distributions, if any, but does not reflect fees, brokerage commissions, or
other expenses of investing. It is not possible to invest directly in an index.
All results are historical. Past performance is no guarantee of future results.
12
<PAGE>
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
----------------------------------------------------------
Mini-Cap Fund
<TABLE>
<CAPTION>
NUMBER OF
DESCRIPTION SHARES VALUE
- --------------------------------------------- --------- ------------
<S> <C> <C>
COMMON STOCKS - 98.40%
BANKS - 0.99%
Bank United Corp........................... 7,500 $ 301,406
------------
BUSINESS SERVICES
ENGINEERING & BUSINESS SERVICES - 16.71%
*ACT Manufacturing, Inc.................... 13,000 182,000
*Appliedtheory Corp........................ 15,000 191,250
*Appnet Systems, Inc....................... 17,500 235,156
*Careerbuilder, Inc........................ 25,000 328,125
Central Parking Corp....................... 8,500 291,125
*Coinstar, Inc............................. 12,000 344,250
*Convergys Corp............................ 17,500 336,875
*Interim Services, Inc..................... 15,000 309,375
*Intervu, Inc.............................. 12,500 478,906
*Profit Recovery Group Int'l, Inc.......... 8,000 378,500
*Republic Services, Inc.................... 15,000 371,250
*Staffmark, Inc............................ 30,000 300,938
*Towne Services, Inc....................... 37,500 295,312
*Transaction Network Services, Inc......... 27,500 804,375
*Ziplink................................... 21,000 262,500
------------
5,109,937
------------
CAPITAL GOODS
BUILDING MATERIALS - 0.83%
*Trex, Inc................................. 10,000 253,750
------------
ELECTRICAL EQUIPMENT - 1.69%
*Interphase Corp........................... 22,500 517,500
------------
INDUSTRIAL COMPONENTS - 2.67%
*Cooper Cameron Corp....................... 7,500 277,969
*Mobile Mini, Inc.......................... 27,500 537,968
------------
815,937
------------
NON-RESIDENTIAL CONSTRUCTION - 1.29%
Elcor Corp................................. 9,000 393,188
------------
TOTAL CAPITAL GOODS................................... 1,980,375
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
13
<PAGE>
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
----------------------------------------------------------
MINI-CAP FUND
<TABLE>
<CAPTION>
NUMBER OF
DESCRIPTION SHARES VALUE
- --------------------------------------------- --------- ------------
<S> <C> <C>
CONSUMER DURABLES
CONSUMER ELECTRONICS MATERIALS - 1.57%
*Dupont Photomasks, Inc.................... 10,000 $ 478,750
------------
CONSUMER NON-DURABLES
APPAREL - 3.17%
*Pacific Sunwear of California............. 22,500 548,438
Wolverine World Wide, Inc.................. 30,000 420,000
------------
968,438
------------
COSMETICS - 2.90%
*Biomatrix, Inc............................ 27,500 594,688
*Blyth Industries, Inc..................... 8,500 292,187
------------
886,875
------------
FOOD PROCESSING EQUIPMENT - 1.37%
*Suiza Foods Corp.......................... 10,000 418,750
------------
TOTAL CONSUMER NON-DURABLES........................... 2,274,063
------------
CONSUMER SERVICES
BROADCASTING - 3.08%
*Cumulus Media, Inc........................ 25,000 546,875
*Pegasus Communications Corp............... 10,000 394,375
------------
941,250
------------
ENTERTAINMENT & RECREATION - 2.56%
*Championship Auto Racing Team............. 15,000 449,062
*Valley Media, Inc......................... 22,500 334,688
------------
783,750
------------
LODGING & RESTAURANTS - 1.92%
*Foodmaker, Inc............................ 15,000 425,625
*Station Casinos, Inc...................... 8,000 162,400
------------
588,025
------------
TOTAL CONSUMER SERVICES............................... 2,313,025
------------
ENERGY
PETROLEUM - 1.15%
*Basin Exploration, Inc.................... 17,500 351,094
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
14
<PAGE>
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
----------------------------------------------------------
MINI-CAP FUND
<TABLE>
<CAPTION>
NUMBER OF
DESCRIPTION SHARES VALUE
- --------------------------------------------- --------- ------------
<S> <C> <C>
PETROLEUM - EQUIPMENT & SERVICES - 4.00%
*BJ Services Co............................ 15,000 $ 441,563
*Global Industries, Inc.................... 22,000 281,875
*Key Energy Services, Inc.................. 47,500 169,218
*Rowan Companies, Inc...................... 18,000 331,875
------------
1,224,531
------------
TOTAL ENERGY.......................................... 1,575,625
------------
FINANCIAL SERVICES
FINANCIAL SERVICES - 3.81%
*Compucredit Corp.......................... 17,500 332,500
Metris Companies, Inc...................... 15,000 611,250
Mission West Properties, Inc............... 4,000 33,000
*TD Waterhouse Group, Inc.................. 7,500 187,969
------------
1,164,719
------------
INSURANCE - PROPERTY & CASUALTY - 1.66%
ESG Re Ltd................................. 15,000 225,000
HCC Insurance Holdings, Inc................ 12,500 283,594
------------
508,594
------------
PROPERTY - 2.38%
Asset Investors Corp....................... 18,000 268,875
*Assisted Living Concepts, Inc............. 30,000 30,000
Golf Trust of America, Inc................. 17,500 427,656
------------
726,531
------------
TOTAL FINANCIAL SERVICES.............................. 2,399,844
------------
HEALTH CARE
HEALTH CARE - GENERAL - 1.73%
*Atrix Laboratories, Inc................... 55,000 529,375
------------
MEDICAL SUPPLIES - 2.74%
*Sunrise Assisted Living, Inc.............. 12,000 418,500
*US Oncology, Inc.......................... 35,000 420,000
------------
838,500
------------
PHARMACEUTICALS - 8.04%
*Anesta Corp............................... 22,500 459,844
*Aphton Corp............................... 8,000 112,000
Bindley Western Industries, Inc............ 26,667 615,000
ICN Pharmaceuticals, Inc................... 20,000 643,750
*Pharmaceutical Product Development,
Inc....................................... 17,000 465,375
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
15
<PAGE>
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
----------------------------------------------------------
MINI-CAP FUND
<TABLE>
<CAPTION>
NUMBER OF
DESCRIPTION SHARES VALUE
- --------------------------------------------- --------- ------------
<S> <C> <C>
PHARMACEUTICALS - 8.04%--CONTINUED
*Serologicals Corp......................... 20,000 $ 162,500
------------
2,458,469
------------
TOTAL HEALTH CARE..................................... 3,826,344
------------
MULTI-INDUSTRY - 1.49%
*Optibase Ltd.............................. 30,000 230,625
*Seminis, Inc.............................. 15,000 225,000
------------
455,625
------------
RAW MATERIALS
CHEMICALS - SPECIALTY - 0.99%
Valspar Corp............................... 8,000 304,000
------------
NON-FERROUS METALS 1.02%
Commonwealth Industries, Inc............... 25,000 312,500
------------
TOTAL RAW MATERIALS................................... 616,500
------------
RETAIL
RETAILERS - BROADLINE - 1.49%
*Cost Plus, Inc............................ 10,000 455,000
------------
RETAILERS - SPECIALTY - 5.60%
Claire's Stores, Inc....................... 27,500 704,688
*Hollywood Entertainment Corp.............. 27,500 537,968
*Intertan, Inc............................. 23,000 471,500
------------
1,714,156
------------
TOTAL RETAIL.......................................... 2,169,156
------------
TECHNOLOGY
AEROSPACE/DEFENSE - 2.58%
*Aviation Sales Co......................... 20,000 790,000
------------
COMMUNICATIONS - 4.35%
*Adaptive Broadband Corp................... 13,000 284,375
*IXC Communications........................ 7,500 294,844
*Metro One Telecommunications, Inc......... 15,000 206,250
*Netopia, Inc.............................. 17,500 398,125
*Viewcast.com, Inc......................... 22,000 147,813
------------
1,331,407
------------
COMPUTER PERIPHERALS - 6.70%
*Check Point Software Technologies Ltd..... 10,000 536,250
*Mercury Interactive Corp.................. 10,000 353,750
*Quadramed Corp............................ 42,500 345,312
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
16
<PAGE>
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
----------------------------------------------------------
MINI-CAP FUND
<TABLE>
<CAPTION>
NUMBER OF
DESCRIPTION SHARES VALUE
- --------------------------------------------- --------- ------------
<S> <C> <C>
COMPUTER PERIPHERALS - 6.70%--CONTINUED
*Remedy Corp............................... 20,000 $ 537,500
*Titan Corp................................ 25,000 275,000
------------
2,047,812
------------
ELECTRONIC COMPONENTS - 5.68%
*American Xtal Technology, Inc............. 17,500 416,719
*DII Group, Inc............................ 17,500 652,968
*DSP Group, Inc............................ 10,000 360,000
Engineered Support Systems, Inc............ 6,000 70,875
*Transwitch Corp........................... 5,000 236,875
------------
1,737,437
------------
TOTAL TECHNOLOGY...................................... 5,906,656
------------
TRANSPORTATION
TRANSPORTATION - MARINE - 1.38%
*Forward Air Corp.......................... 15,000 421,875
------------
TRANSPORTATION - ROAD - 0.86%
*Transportation Technologies............... 20,000 265,000
------------
TOTAL TRANSPORTATION.................................. 686,875
------------
TOTAL COMMON STOCKS (Cost $27,621,937)................ 30,094,181
------------
TOTAL INVESTMENTS - 98.40%
(Cost $27,621,937)................................... 30,094,181
CASH AND OTHER ASSETS, NET OF LIABILITIES - 1.60%..... 489,975
------------
NET ASSETS - 100.00%.................................... $ 30,584,156
------------
------------
</TABLE>
* INDICATES NON-INCOME PRODUCING SECURITY.
SEE NOTES TO FINANCIAL STATEMENTS.
17
<PAGE>
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
----------------------------------------------------------
Value+Growth Fund
<TABLE>
<CAPTION>
NUMBER OF
DESCRIPTION SHARES VALUE
- --------------------------------------- ---------- -----------
<S> <C> <C>
COMMON STOCKS - 95.71%
BANKS - 3.56%
First Union Corp..................... 14,800 $ 695,600
Washington Mutual, Inc............... 18,850 666,819
-----------
1,362,419
-----------
BUSINESS SERVICES
ENGINEERING & BUSINESS SERVICES - 9.24%
First Data Corp...................... 25,500 1,247,906
Galileo International, Inc........... 8,600 459,563
*Republic Services, Inc.............. 47,900 1,185,525
*Sabre Group Holdings, Inc........... 9,400 646,250
-----------
3,539,244
-----------
CAPITAL GOODS
INDUSTRIAL COMPONENTS - 2.62%
Parker Hannifin Corp................. 21,950 1,004,213
-----------
MACHINERY - 0.66%
Deere & Co........................... 6,400 253,600
-----------
TOTAL CAPITAL GOODS.............................. 1,257,813
-----------
CONSUMER DURABLES
HOUSEHOLD DURABLES - 1.01%
Masco Corp........................... 13,400 386,925
-----------
CONSUMER NON-DURABLES
FOOD PROCESSING EQUIPMENT - 3.31%
Hormel Foods Corp.................... 10,800 434,700
Sysco Corp........................... 28,000 834,750
-----------
1,269,450
-----------
HOUSEHOLD PRODUCTS - 3.34%
Newell Rubbermaid, Inc............... 27,500 1,278,750
-----------
TOTAL CONSUMER NON-DURABLES...................... 2,548,200
-----------
CONSUMER SERVICES
BROADCASTING - 1.86%
ECI Telecom Ltd...................... 21,500 713,531
-----------
ENTERTAINMENT & RECREATION - 1.57%
Mattel, Inc.......................... 22,800 602,775
-----------
PUBLISHING - 2.55%
McGraw-Hill Companies, Inc........... 10,300 555,556
*Valassis Communications, Inc........ 11,500 421,188
-----------
976,744
-----------
TOTAL CONSUMER SERVICES.......................... 2,293,050
-----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
18
<PAGE>
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
----------------------------------------------------------
VALUE+GROWTH FUND
<TABLE>
<CAPTION>
NUMBER OF
DESCRIPTION SHARES VALUE
- --------------------------------------- ---------- -----------
<S> <C> <C>
ENERGY
PETROLEUM - 9.72%
Santa Fe International Corp.......... 24,100 $ 554,300
Apache Corp.......................... 17,800 694,200
Suncor Energy, Inc................... 23,500 966,438
Texaco, Inc.......................... 13,900 868,750
Vastar Resources, Inc................ 12,200 639,737
-----------
3,723,425
-----------
FINANCIAL SERVICES
FINANCIAL SERVICES - 2.53%
CIT Group, Inc....................... 25,300 730,538
Radian Group, Inc.................... 4,906 239,474
-----------
970,012
-----------
INSURANCE - LIFE - 5.24%
Fremont General Corp................. 18,700 352,962
Provident Companies, Inc............. 19,300 772,000
Reliastar Financial Corp............. 20,200 883,750
-----------
2,008,712
-----------
INSURANCE - PROPERTY & CASUALTY - 3.48%
Cigna Corp........................... 11,100 987,900
Travelers Property Casualty Corp..... 8,800 344,300
-----------
1,332,200
-----------
PROPERTY - 4.68%
Avanlonbay Communities, Inc.......... 7,800 288,600
Equity Residential Properties
Trust............................... 8,100 365,006
Prologis Trust....................... 27,800 562,950
Public Storage, Inc.................. 10,000 280,000
Spieker Properties, Inc.............. 7,600 295,450
-----------
1,792,006
-----------
TOTAL FINANCIAL SERVICES......................... 6,102,930
-----------
HEALTH CARE
HEALTH CARE - GENERAL - 3.59%
Baxter International, Inc............ 22,700 1,376,188
PHARMACEUTICALS - 2.71%
*Elan Plc............................ 15,100 419,025
Mylan Laboratories, Inc.............. 23,400 620,100
-----------
1,039,125
-----------
TOTAL HEALTH CARE................................ 2,415,313
-----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
19
<PAGE>
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
----------------------------------------------------------
VALUE+GROWTH FUND
<TABLE>
<CAPTION>
NUMBER OF
DESCRIPTION SHARES VALUE
- --------------------------------------- ---------- -----------
<S> <C> <C>
RAW MATERIALS
CHEMICALS - SPECIALTY - 0.90%
OM Group, Inc........................ 10,000 $ 345,000
-----------
RETAIL
RETAILERS - FOOD & DRUG - 3.29%
Albertson's, Inc..................... 16,317 841,345
Hannaford Brothers, Inc.............. 7,800 417,300
-----------
1,258,645
-----------
RETAILERS - SPECIALTY - 1.31%
Circuit City Stores, Inc............. 5,400 502,200
-----------
TOTAL RETAIL..................................... 1,760,845
-----------
TECHNOLOGY
COMPUTER PERIPHERALS - 10.91%
*Electronic Arts..................... 11,500 623,875
*Parametric Technology Corp.......... 49,700 689,588
*Quantum Corp........................ 31,000 747,875
*Seagate Technology.................. 23,100 591,938
*Synopsys, Inc....................... 13,700 756,068
*Transaction Systems Architects...... 19,800 772,200
-----------
4,181,544
-----------
COMPUTERS - 2.36%
Xerox Corp........................... 15,300 903,656
ELECTRONIC COMPONENTS - 3.01%
*Cognex Corp......................... 13,700 432,406
Motorola, Inc........................ 7,600 720,100
-----------
1,152,506
-----------
TOTAL TECHNOLOGY................................. 6,237,706
-----------
TRANSPORTATION
TRANSPORTATION - AIR - 3.67%
*FDX Corp............................ 10,900 591,325
Southwest Airlines Co................ 26,200 815,475
-----------
1,406,800
-----------
UTILITIES
UTILITIES - ELECTRIC - 3.81%
*AES Corp............................ 25,100 1,458,937
UTILITIES - GAS - 2.03%
Enron Corp........................... 9,500 776,625
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
20
<PAGE>
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
----------------------------------------------------------
VALUE+GROWTH FUND
<TABLE>
<CAPTION>
NUMBER OF
DESCRIPTION SHARES VALUE
- --------------------------------------- ---------- -----------
<S> <C> <C>
UTILITIES - TELEPHONE - 2.75%
SBC Communications, Inc.............. 18,200 $ 1,055,600
-----------
TOTAL UTILITIES.................................. 3,291,162
-----------
TOTAL COMMON STOCKS (Cost $31,872,996)........... 36,670,832
-----------
TOTAL INVESTMENTS - 95.71% (Cost $31,872,996).... 36,670,832
Cash and Other Assets, Net of Liabilities -
4.29%........................................... 1,642,314
-----------
NET ASSETS - 100.00%............................... $38,313,146
-----------
-----------
</TABLE>
* INDICATES NON-INCOME PRODUCING SECURITY.
SEE NOTES TO FINANCIAL STATEMENTS.
21
<PAGE>
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
----------------------------------------------------------
Balanced Fund
<TABLE>
<CAPTION>
NUMBER OF
DESCRIPTION SHARES VALUE
- --------------------------------------- ----------- -----------
<S> <C> <C>
COMMON STOCKS - 64.05%
BANKS - 2.46%
First Union Corp..................... 13,100 $ 615,700
Washington Mutual, Inc............... 15,750 557,156
-----------
1,172,856
-----------
BUSINESS SERVICES
ENGINEERING & BUSINESS SERVICES - 6.28%
First Data Corp...................... 22,000 1,076,625
Galileo International, Inc........... 6,900 368,719
*Republic Services, Inc.............. 40,200 994,950
*Sabre Group Holdings, Inc........... 8,100 556,875
-----------
2,997,169
-----------
CAPITAL GOODS
INDUSTRIAL COMPONENTS - 1.67%
Parker Hannifin Corp................. 17,400 796,050
MACHINERY - 0.47%
Deere & Co........................... 5,600 221,900
-----------
TOTAL CAPITAL GOODS............................... 1,017,950
-----------
CONSUMER DURABLES
HOUSEHOLD DURABLES - 0.64%
Masco Corp........................... 10,600 306,075
-----------
CONSUMER NON-DURABLES
FOOD PROCESSING EQUIPMENT - 2.19%
Hormel Foods Corp.................... 9,300 374,325
Sysco Corp........................... 22,500 670,781
-----------
1,045,106
-----------
HOUSEHOLD PRODUCTS - 2.21%
Newell Rubbermaid, Inc............... 22,700 1,055,550
-----------
TOTAL CONSUMER NON-DURABLES....................... 2,100,656
-----------
CONSUMER SERVICES
BROADCASTING - 1.29%
ECI Telecom Ltd...................... 18,600 617,288
-----------
ENTERTAINMENT & RECREATION - 1.03%
Mattel, Inc.......................... 18,600 491,737
-----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
22
<PAGE>
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
----------------------------------------------------------
BALANCED FUND
<TABLE>
<CAPTION>
NUMBER OF
DESCRIPTION SHARES VALUE
- --------------------------------------- ----------- -----------
<S> <C> <C>
PUBLISHING - 1.73%
McGraw-Hill Companies, Inc........... 8,900 $ 480,044
*Valassis Communications, Inc........ 9,450 346,106
-----------
826,150
-----------
TOTAL CONSUMER SERVICES........................... 1,935,175
-----------
ENERGY
PETROLEUM - 6.62%
Santa Fe International Corp.......... 19,100 439,300
Apache Corp.......................... 15,600 608,400
Suncor Energy, Inc................... 20,000 822,500
Texaco, Inc.......................... 12,000 750,000
Vastar Resources, Inc................ 10,300 540,106
-----------
3,160,306
-----------
FINANCIAL SERVICES
FINANCIAL SERVICES - 1.65%
CIT Group, Inc....................... 20,900 603,488
Radian Group, Inc.................... 3,733 182,217
-----------
785,705
-----------
INSURANCE - LIFE - 3.55%
Fremont General Corp................. 15,500 292,562
Provident Companies, Inc............. 16,000 640,000
Reliastar Financial Corp............. 17,400 761,250
-----------
1,693,812
-----------
INSURANCE - PROPERTY & CASUALTY - 2.31%
Cigna Corp........................... 9,200 818,800
Travelers Property Casualty Corp..... 7,200 281,700
-----------
1,100,500
-----------
PROPERTY - 3.11%
Avanlonbay Communities, Inc.......... 6,800 251,600
Equity Residential Properties
Trust............................... 6,000 270,375
Prologis Trust....................... 23,700 479,925
Public Storage, Inc.................. 8,900 249,200
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
23
<PAGE>
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
----------------------------------------------------------
BALANCED FUND
<TABLE>
<CAPTION>
NUMBER OF
DESCRIPTION SHARES VALUE
- --------------------------------------- ----------- -----------
<S> <C> <C>
PROPERTY - 3.11%--CONTINUED
Spieker Properties, Inc.............. 6,000 $ 233,250
-----------
1,484,350
-----------
TOTAL FINANCIAL SERVICES.......................... 5,064,367
-----------
HEALTH CARE
HEALTH CARE - GENERAL - 2.41%
Baxter International, Inc............ 19,000 1,151,875
-----------
PHARMACEUTICALS - 1.76%
*Elan Plc............................ 11,800 327,450
Mylan Laboratories, Inc.............. 19,300 511,450
-----------
838,900
-----------
TOTAL HEALTH CARE................................. 1,990,775
-----------
RAW MATERIALS
CHEMICALS - SPECIALTY - 0.61%
OM Group, Inc........................ 8,400 289,800
-----------
RETAIL
RETAILERS - FOOD & DRUG - 1.99%
Albertson's, Inc..................... 13,041 672,427
Hannaford Brothers, Inc.............. 5,200 278,200
-----------
950,627
-----------
RETAILERS - SPECIALTY - 0.88%
Circuit City Stores, Inc............. 4,500 418,500
-----------
TOTAL RETAIL...................................... 1,369,127
-----------
TECHNOLOGY
COMPUTER PERIPHERALS - 7.44%
*Electronic Arts..................... 9,600 520,800
*Parametric Technology Corp.......... 38,800 538,350
*Quantum Corp........................ 25,900 624,838
*Seagate Technology.................. 19,900 509,938
*Synopsys, Inc....................... 12,500 689,843
*Transaction Systems Architects...... 17,100 666,900
-----------
3,550,669
-----------
COMPUTERS - 1.63%
Xerox Corp........................... 13,200 779,625
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
24
<PAGE>
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
----------------------------------------------------------
BALANCED FUND
<TABLE>
<CAPTION>
NUMBER OF
DESCRIPTION SHARES VALUE
- --------------------------------------- ----------- -----------
<S> <C> <C>
ELECTRONIC COMPONENTS - 1.99%
*Cognex Corp......................... 10,800 $ 340,875
Motorola, Inc........................ 6,400 606,400
-----------
947,275
-----------
TOTAL TECHNOLOGY.................................. 5,277,569
-----------
TRANSPORTATION
TRANSPORTATION - AIR - 2.44%
*FDX Corp............................ 9,200 499,100
Southwest Airlines Co................ 21,400 666,075
-----------
1,165,175
-----------
UTILITIES
UTILITIES - ELECTRIC - 2.53%
*AES Corp............................ 20,800 1,209,000
-----------
UTILITIES - GAS - 1.35%
Enron Corp........................... 7,900 645,825
-----------
UTILITIES - TELEPHONE - 1.81%
SBC Communications, Inc.............. 14,800 858,400
-----------
TOTAL UTILITIES................................... 2,713,225
-----------
TOTAL COMMON STOCKS (COST $24,671,149)............ 30,560,225
-----------
<CAPTION>
PAR VALUE
-----------
<S> <C> <C>
AGENCY - 4.46%
FEDERAL NATIONAL MORTGAGE ASSOCATION -
4.46%
5.750%, 4/15/03...................... $ 1,000,000 988,910
5.750%, 6/15/05...................... 1,170,000 1,141,475
-----------
TOTAL AGENCY (COST $2,189,346).................... 2,130,385
-----------
CORPORATE BONDS - 23.36%
FINANCE - 8.16%
Associates Corp. of North America
5.875%, 5/16/01..................... 850,000 847,348
Ford Motor Credit Co.
8.200%, 2/15/02..................... 850,000 887,791
Lehman Brothers Holdings, Inc.
6.250%, 4/1/03...................... 750,000 729,060
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
25
<PAGE>
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
----------------------------------------------------------
BALANCED FUND
<TABLE>
<CAPTION>
DESCRIPTION PAR VALUE VALUE
- --------------------------------------- ----------- -----------
FINANCE - 8.16%--CONTINUED
<S> <C> <C>
Morgan Stanley Group, Inc.
5.625%, 1/20/04..................... $ 750,000 $ 722,543
PNC Funding Corp.
6.125%, 2/15/09..................... 750,000 706,080
-----------
3,892,822
-----------
INDUSTRIAL - 13.73%
Ball Corp.
7.750%, 8/1/06...................... 1,200,000 1,194,000
Coca-Cola Enterprises, Inc.
6.375%, 8/1/01...................... 960,000 963,715
Friendly Ice Cream Corp.
10.500%, 12/1/07.................... 500,000 445,000
Glatfelter P H Co.
6.875%, 7/15/07..................... 1,000,000 984,590
Lear Corp.
7.960%, 5/15/05..................... 500,000 485,000
8.110%, 5/15/09..................... 500,000 478,750
Safeway, Inc.
6.050%, 11/15/03.................... 1,000,000 974,940
Viacom, Inc.
7.750%, 6/1/05...................... 1,000,000 1,027,410
-----------
6,553,405
-----------
TELEPHONE - 1.47%
Sprint Capital Corp.
6.125%, 11/15/08.................... 750,000 701,505
-----------
TOTAL CORPORATE BONDS (COST $11,430,883).......... 11,147,732
-----------
MORTGAGE PASS-THROUGH - 8.34%
FEDERAL HOME LOAN MORTGAGE
CORPORATION - 3.90%
7.500%, 4/1/28....................... 709,218 716,970
6.000%, 7/1/28....................... 1,214,380 1,141,893
-----------
1,858,863
-----------
FEDERAL NATIONAL MORTGAGE ASSOCIATION -
4.44%
7.000%, 2/1/28....................... 994,994 983,482
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
26
<PAGE>
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
----------------------------------------------------------
BALANCED FUND
<TABLE>
<CAPTION>
DESCRIPTION PAR VALUE VALUE
- --------------------------------------- ----------- -----------
FEDERAL NATIONAL MORTGAGE ASSOCIATION -
4.44%--CONTINUED
<S> <C> <C>
6.500%, 7/1/28....................... $ 1,178,008 $ 1,136,401
-----------
2,119,883
-----------
TOTAL MORTGAGE PASS-THROUGH (COST $4,118,075)..... 3,978,746
-----------
U.S. TREASURY OBLIGATIONS - 7.81%
U.S. TREASURY BONDS - 2.48%
7.500%, 11/15/16..................... 1,050,000 1,182,993
U.S. TREASURY NOTES - 3.66%
7.500%, 11/15/01..................... 600,000 624,534
6.250%, 2/15/03...................... 1,100,000 1,117,314
-----------
1,741,848
-----------
U.S. TREASURY STRIPS - 1.67%
11/15/09............................. 1,500,000 797,850
-----------
TOTAL U.S. TREASURY OBLIGATIONS (COST
$3,869,024)...................................... 3,722,691
-----------
REPURCHASE AGREEMENT - 3.03%
State Street Bank & Trust Co.,
$1,445,000 at 3.250% (Agreement
dated June 30, 1999; $1,445,130 on
7/1/99; collateralized by U.S.
Treasury Bonds due 2/15/19) (Value
$1,516,256) (Cost $1,445,000)....... 1,445,000 1,445,000
-----------
TOTAL INVESTMENTS - 111.05% (Cost $47,723,477).... 52,984,779
Liabilities, Net of Cash and Other Assets -
(11.05%)......................................... (5,271,149)
-----------
NET ASSETS - 100.00%................................ $47,713,630
-----------
-----------
</TABLE>
* INDICATES NON-INCOME PRODUCING SECURITY.
SEE NOTES TO FINANCIAL STATEMENTS.
27
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
JUNE 30, 1999
----------------------------------------------------------
<TABLE>
<CAPTION>
MINI-CAP VALUE+ BALANCED
FUND GROWTH FUND FUND
----------- ------------- -----------
<S> <C> <C> <C>
ASSETS
Investments in securities, at value (cost of $27,621,937,
$31,872,996, $47,723,477) $30,094,181 $ 36,670,832 $52,984,779
Cash 75,198 1,225,230 2,234
Receivables:
Investment securities sold 1,275,941 456,584 367,189
Investment income 10,381 40,591 321,838
Fund shares sold 201,836 6,621 8,818
Prepaid expenses 4,970 4,616 4,442
Deferred organization costs 2,212 2,212 986
----------- ------------- -----------
Total assets 31,664,719 38,406,686 53,690,286
----------- ------------- -----------
LIABILITIES
Payables:
Investment securities purchased 692,532 -- 525,430
Fund shares redeemed 273,354 26,432 5,338,553
Distributions to shareholders 5,329 2,198 32,877
Investment advisory fees 40,623 23,777 22,996
Accrued expenses 68,725 41,133 56,800
----------- ------------- -----------
Total liabilities 1,080,563 93,540 5,976,656
----------- ------------- -----------
NET ASSETS $30,584,156 $ 38,313,146 $47,713,630
----------- ------------- -----------
----------- ------------- -----------
COMPOSITION OF NET ASSETS
Paid-in capital $32,784,592 $ 32,951,807 $39,960,552
Undistributed net investment income -- 81,986 6,316
Undistributed net realized gain (loss) (4,672,680) 481,517 2,485,460
Net unrealized appreciation 2,472,244 4,797,836 5,261,302
----------- ------------- -----------
NET ASSETS $30,584,156 $ 38,313,146 $47,713,630
----------- ------------- -----------
----------- ------------- -----------
Number of shares, $0.01 par value, issued and outstanding
(unlimited shares authorized) 1,896,317 2,385,871 3,226,408
----------- ------------- -----------
----------- ------------- -----------
NET ASSET VALUE PER SHARE $ 16.13 $ 16.06 $ 14.79
----------- ------------- -----------
----------- ------------- -----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
28
<PAGE>
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED JUNE 30, 1999
----------------------------------------------------------
<TABLE>
<CAPTION>
MINI-CAP VALUE+ BALANCED
FUND GROWTH FUND FUND
----------- ------------ -----------
<S> <C> <C> <C>
INVESTMENT INCOME
INCOME
Dividend income $ 301,275 $ 465,992 $ 416,282
Interest income 54,892 94,542 1,548,388
----------- ------------ -----------
Total income 356,167 560,534 1,964,670
----------- ------------ -----------
EXPENSES
Investment advisory fees 416,566 322,503 408,129
Shareholder service fees 61,720 76,558 31,711
Administration fees 66,466 45,490 52,625
Custody and accounting fees 46,869 38,726 41,441
Professional fees 21,136 34,657 35,114
Transfer agent fees 60,512 33,999 42,225
Shareholder reporting fees 52,698 1,633 6,546
Registration fees 17,196 11,505 16,297
Trustees fees 14,001 14,001 13,112
Insurance 5,654 5,577 8,770
Amortization of deferred organization
costs 9,366 9,366 2,537
Miscellaneous 13,245 6,116 10,204
----------- ------------ -----------
Total expenses 785,429 600,131 668,711
Less: expenses reimbursed (157,576) (122,972) (112,297)
Add: credit line commitment fees 2,896 1,389 2,071
----------- ------------ -----------
Net expenses 630,749 478,548 558,485
----------- ------------ -----------
Net investment income (loss) (274,582) 81,986 1,406,185
----------- ------------ -----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS
Net realized gain (loss) on investments (4,630,969) 1,495,633 4,408,560
Net unrealized depreciation on investments (3,474,243) (357,291) (3,149,185)
----------- ------------ -----------
Net gain (loss) on investments (8,105,212) 1,138,342 1,259,375
----------- ------------ -----------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $(8,379,794) $1,220,328 $ 2,665,560
----------- ------------ -----------
----------- ------------ -----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
29
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED JUNE 30,
----------------------------------------------------------
Mini-Cap Fund
<TABLE>
<CAPTION>
1999 1998
------------ -------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment loss $ (274,582) $ (802,346)
Net realized gain (loss) on investments (4,630,969) 27,481,233
Net unrealized depreciation on investments (3,474,243) (13,131,072)
------------ -------------
Net increase (decrease) in net assets from
operations (8,379,794) 13,547,815
------------ -------------
Distributions to shareholders:
From net investment income (5,303,746) --
------------ -------------
Total distributions (5,303,746) (30,810,487)
------------ -------------
Fund share transactions:
Proceeds from shares sold 29,397,612 96,326,126
Net asset value of shares issued on reinvestment of
distributions 5,022,337 28,723,773
Cost of shares redeemed (81,022,556) (139,969,472)
------------ -------------
Net decrease from Fund share transactions (46,602,607) (14,919,573)
------------ -------------
NET DECREASE IN NET ASSETS (60,286,147) (32,182,245)
NET ASSETS
Beginning of year 90,870,303 123,052,548
------------ -------------
End of year $ 30,584,156 $ 90,870,303
------------ -------------
------------ -------------
CHANGE IN SHARES
Shares sold 1,911,091 4,433,085
Shares issued on reinvestment of distributions 370,081 1,437,672
Shares redeemed (5,143,333) (6,748,102)
------------ -------------
Net decrease (2,862,161) (877,345)
------------ -------------
------------ -------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
30
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED JUNE 30,
----------------------------------------------------------
VALUE+GROWTH FUND
<TABLE>
<CAPTION>
1999 1998
------------ ------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income $ 81,986 $ 34,649
Net realized gain on investments 1,495,633 2,939,634
Net unrealized appreciation (depreciation) on
investments (357,291) 1,178,382
------------ ------------
Net increase in net assets from operations 1,220,328 4,152,665
------------ ------------
Distributions to shareholders:
From net investment income -- (120,896)
From net realized gains (2,433,086) (3,451,349)
------------ ------------
Total distributions (2,433,086) (3,572,245)
------------ ------------
Fund share transactions:
Proceeds from shares sold 7,381,672 30,647,357
Net asset value of shares issued on reinvestment of
distributions 2,423,047 3,471,757
Cost of shares redeemed (17,678,158) (11,294,038)
------------ ------------
Net increase (decrease) from Fund share transactions (7,873,439) 22,825,076
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS (9,086,197) 23,405,496
NET ASSETS
Beginning of year 47,399,343 23,993,847
------------ ------------
End of year $ 38,313,146 $ 47,399,343
------------ ------------
------------ ------------
CHANGE IN SHARES
Shares sold 485,266 1,930,512
Shares issued on reinvestment of distributions 170,397 222,229
Shares redeemed (1,195,319) (702,262)
------------ ------------
Net increase (decrease) (539,656) 1,450,479
------------ ------------
------------ ------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
31
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED JUNE 30,
----------------------------------------------------------
BALANCED FUND
<TABLE>
<CAPTION>
1999 1998
------------ ------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income $ 1,406,185 $ 1,372,379
Net realized gain on investments 4,408,560 4,341,116
Net unrealized depreciation on investments (3,149,185) (176,701)
------------ ------------
Net increase in net assets from operations 2,665,560 5,536,794
------------ ------------
Distributions to shareholders:
From net investment income (1,419,256) (1,405,083)
From net realized gains (4,179,056) (6,870,711)
------------ ------------
Total distributions (5,598,312) (8,275,794)
------------ ------------
Fund share transactions:
Proceeds from shares sold 4,586,684 14,900,421
Net asset value of shares issued on reinvestment of
distributions 5,376,083 8,100,854
Cost of shares redeemed (25,997,325) (16,979,476)
------------ ------------
Net increase (decrease) from Fund share transactions (16,034,558) 6,021,799
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS (18,967,310) 3,282,799
NET ASSETS
Beginning of year 66,680,940 63,398,141
------------ ------------
End of year $ 47,713,630 $ 66,680,940
------------ ------------
------------ ------------
CHANGE IN SHARES
Shares sold 313,760 956,486
Shares issued on reinvestment of distributions 378,678 527,543
Shares redeemed (1,785,419) (1,109,840)
------------ ------------
Net increase (decrease) (1,092,981) 374,189
------------ ------------
------------ ------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
32
<PAGE>
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD.
----------------------------------------------------------
Mini-Cap Fund
<TABLE>
<CAPTION>
FOR THE PERIODS
------------------------------------------------------------
07/01/98 07/01/97 07/01/96 07/01/95 09/30/94+
TO TO TO TO TO
6/30/99 06/30/98 06/30/97 06/30/96 06/30/95
--------- --------- ---------- --------- -----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 19.10 $ 21.83 $ 18.39 $ 14.12 $ 10.00
--------- --------- ---------- --------- -----------
Income from investment operations
Net investment income (loss) (0.14) (0.17) (0.01) (0.02) 0.01
Net realized and unrealized gain (loss) on
investments (0.93) 2.40 4.04 5.25 4.13
--------- --------- ---------- --------- -----------
Total from investment operations (1.07) 2.23 4.03 5.23 4.14
--------- --------- ---------- --------- -----------
Less distributions
From net investment income -- -- -- -- (0.02)
From net realized gains (1.90) (4.96) (0.59) (0.96) -
--------- --------- ---------- --------- -----------
Total distributions (1.90) (4.96) (0.59) (0.96) (0.02)
--------- --------- ---------- --------- -----------
Net asset value, end of period $ 16.13 $ 19.10 $ 21.83 $ 18.39 $ 14.12
--------- --------- ---------- --------- -----------
--------- --------- ---------- --------- -----------
Total return (3.78)% 10.29% 22.45% 38.46% 41.47%**
--------- --------- ---------- --------- -----------
--------- --------- ---------- --------- -----------
Net assets at end of period (in 000's) $30,584 $90,870 $ 123,053 $92,697 $10,397
--------- --------- ---------- --------- -----------
--------- --------- ---------- --------- -----------
Ratio of expenses to average net assets (net of
expense reimbursements and recoupments)(1) 1.50% 1.50% 1.50% 1.50% 1.50%*
--------- --------- ---------- --------- -----------
--------- --------- ---------- --------- -----------
Ratio of net investment income (loss) to average
net assets (0.66)% (0.59)% (0.08)% (0.35)% 0.04%*
--------- --------- ---------- --------- -----------
--------- --------- ---------- --------- -----------
Portfolio turnover rate 179.91% 168.74% 304.88% 214.71% 102.85%**
--------- --------- ---------- --------- -----------
--------- --------- ---------- --------- -----------
</TABLE>
* ANNUALIZED.
**NOT ANNUALIZED.
+ FUND COMMENCED OPERATIONS ON SEPTEMBER 30, 1994.
1 THE RATIOS OF EXPENSES TO AVERAGE NET ASSETS BEFORE EXPENSE REIMBURSEMENTS AND
RECOUPMENTS WERE 1.89%, 1.55%, 1.39%, 1.74% AND 4.99% FOR THE MINI-CAP FUND
FOR THE PERIODS ENDED JUNE 30, 1999, 1998, 1997, 1996 AND 1995, RESPECTIVELY.
SEE NOTES TO FINANCIAL STATEMENTS.
33
<PAGE>
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD.
----------------------------------------------------------
VALUE+GROWTH FUND
<TABLE>
<CAPTION>
FOR THE PERIODS
---------------------------------------------------------------
07/01/98 07/01/97 07/01/96 07/01/95 09/30/94+
TO TO TO TO TO
06/30/99 06/30/98 06/30/97 06/30/96 06/30/95
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
period $ 16.20 $ 16.27 $ 13.69 $ 12.82 $ 10.00
----------- ----------- ----------- ----------- -----------
Income from investment
operations
Net investment income 0.03 0.01 0.10 0.11 0.05
Net realized and unrealized
gain on investments 0.82 1.77 4.03 1.40 2.79
----------- ----------- ----------- ----------- -----------
Total from investment
operations 0.85 1.78 4.13 1.51 2.84
----------- ----------- ----------- ----------- -----------
Less distributions
From net investment income -- (0.04) (0.10) (0.13) (0.02)
From net realized gains (0.99) (1.81) (1.45) (0.51) --
----------- ----------- ----------- ----------- -----------
Total distributions (0.99) (1.85) (1.55) (0.64) (0.02)
----------- ----------- ----------- ----------- -----------
Net asset value, end of
period $ 16.06 $ 16.20 $ 16.27 $ 13.69 $ 12.82
----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- -----------
Total return 6.05% 11.54% 32.38% 12.11% 28.43%**
----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- -----------
Net assets at end of period
(in 000's) $ 38,313 $ 47,399 $ 23,994 $ 21,256 $ 12,989
----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- -----------
Ratio of expenses to average
net assets (net of expense
reimbursements)(1) 1.25% 1.25% 1.26% 1.35% 1.35%*
----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- -----------
Ratio of net investment
income to average net
assets 0.22% 0.09% 0.45% 0.78% 1.18%*
----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- -----------
Portfolio turnover rate 92.42% 60.51% 160.13% 101.05% 31.64%**
----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- -----------
</TABLE>
* ANNUALIZED.
**NOT ANNUALIZED.
+ FUND COMMENCED OPERATIONS ON SEPTEMBER 30, 1994.
1 THE RATIOS OF EXPENSES TO AVERAGE NET ASSETS BEFORE EXPENSE REIMBURSEMENTS
WERE 1.58%, 1.48%, 2.11%, 2.12% AND 5.21% FOR THE VALUE+GROWTH FUND FOR THE
PERIODS ENDED JUNE 30, 1999, 1998, 1997, 1996 AND 1995, RESPECTIVELY.
SEE NOTES TO FINANCIAL STATEMENTS.
34
<PAGE>
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD.
----------------------------------------------------------
BALANCED FUND
<TABLE>
<CAPTION>
FOR THE PERIODS
----------------------------------------------------------------------------
07/01/98 07/01/97 07/01/96 07/01/95
TO TO TO TO 10/01/94 TO 11/01/93 TO
06/30/99 06/30/98 06/30/97 06/30/96 06/30/95 09/30/94
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $ 15.44 $ 16.07 $ 14.69 $ 13.96 $ 12.41 $ 12.82
----------- ----------- ----------- ----------- ----------- -----------
Income from investment
operations
Net investment income 0.36 0.31 0.38 0.43 0.24 0.16
Net realized and
unrealized gain on
investments 0.38 1.05 2.78 1.27 1.59 0.05
----------- ----------- ----------- ----------- ----------- -----------
Total from investment
operations 0.74 1.36 3.16 1.70 1.83 0.21
----------- ----------- ----------- ----------- ----------- -----------
Less distributions
From net investment
income (0.36) (0.32) (0.37) (0.43) (0.24) (0.18)
From net realized gains (1.03) (1.67) (1.41) (0.54) (0.04) (0.44)
----------- ----------- ----------- ----------- ----------- -----------
Total distributions (1.39) (1.99) (1.78) (0.97) (0.28) (0.62)
----------- ----------- ----------- ----------- ----------- -----------
Net asset value, end of
period $ 14.79 $ 15.44 $ 16.07 $ 14.69 $ 13.96 $ 12.41
----------- ----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- ----------- -----------
Total return 5.39% 8.96% 23.12% 12.56% 14.98%** 3.66%**
----------- ----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- ----------- -----------
Net assets at end of
period (in 000's) $ 47,714 $ 66,681 $ 63,398 $ 46,979 $ 38,836 $ 34,659
----------- ----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- ----------- -----------
Ratio of expenses to
average net assets
(net of expense
reimbursements)(1) 0.95% 1.00% 1.26% 1.35% 1.33%* 1.63%*
----------- ----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- ----------- -----------
Ratio of net investment
income to average
net assets 2.41% 1.99% 2.62% 2.98% 2.51%* 1.77%*
----------- ----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- ----------- -----------
Portfolio turnover rate 91.64% 83.27% 91.90% 69.11% 54.02%** 60.90%
----------- ----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- ----------- -----------
</TABLE>
* ANNUALIZED.
**NOT ANNUALIZED.
1 THE RATIOS OF EXPENSES TO AVERAGE NET ASSETS BEFORE EXPENSE REIMBURSEMENTS
WERE 1.15%, 1.37%, 1.31%, 1.49% AND 1.42% FOR THE BALANCED FUND FOR THE YEARS
ENDED JUNE 30, 1999, 1998, 1997 AND 1996 AND THE PERIOD ENDED JUNE 30, 1995,
RESPECTIVELY.
SEE NOTES TO FINANCIAL STATEMENTS.
35
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION
Jurika & Voyles Fund Group (the "Trust") was organized as a Delaware business
trust on July 11, 1994 and is registered under the Investment Company Act of
1940 (the "1940 Act") as a diversified, open-end management investment company.
The Trust consists of three separate diversified series: Jurika & Voyles
Mini-Cap Fund, Jurika & Voyles Value+Growth Fund, and Jurika & Voyles Balanced
Fund (each a "Fund" and collectively the "Funds").
The investment objectives of the Funds are as follows:
The Mini-Cap Fund seeks to maximize long-term capital appreciation. This Fund
invests primarily in the common stock of quality companies having small market
capitalizations that offer current value and significant future growth
potential.
The Value+Growth Fund seeks long-term capital appreciation. This Fund invests
primarily in the common stock of quality companies of all market capitalizations
that offer current value and significant future growth potential.
The Balanced Fund seeks to provide investors with a balance of long-term capital
appreciation and current income. This Fund invests primarily in a diversified
portfolio that combines stocks, bonds and cash-equivalent securities.
On September 30, 1994, shareholders of the Jurika & Voyles Balanced Fund (the
"Balanced Fund"), formerly a portfolio of the Advisors' Inner Circle Fund (the
"Old Fund"), exchanged 2,793,608 shares of the Old Fund (valued at $34,658,609,
including unrealized gains of $1,199,928) for 2,793,608 shares of the Balanced
Fund in a tax-free exchange. All of the assets of the Old Fund were transferred
to the Balanced Fund at net asset value. The Financial Highlights for the period
prior to October 1, 1994 includes the results of the Old Fund.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of the significant accounting policies followed by
the Funds.
SECURITY VALUATION--Securities trading on a national exchange or the Nasdaq
National Market System are valued at the last reported sales
36
<PAGE>
NOTES TO FINANCIAL STATEMENTS
2. SIGNIFICANT ACCOUNTING POLICIES--CONTINUED
price at the close of regular trading on the last business day of the
period. If there are no sales on such day, these securities are valued at
the mean between the closing bid and asked prices. Securities and other
assets for which market prices are not readily available are valued at fair
value as determined in good faith by the Board of Trustees. Debt securities
with remaining maturities of 60 days or less are valued at amortized cost,
unless the Board of Trustees determines that amortized cost does not
represent fair value.
FEDERAL INCOME TAXES--Each Fund has qualified and intends to continue to
qualify as a regulated investment company by complying with the appropriate
provisions of the Internal Revenue Code of 1986, as amended. Accordingly, no
provisions for federal income taxes are required.
SECURITY TRANSACTIONS AND RELATED INCOME--Security transactions are
accounted for on the date the security is purchased or sold (trade date).
Dividend income is recognized on the ex-dividend date, and interest income
is recognized on the accrual basis. Purchase discounts and premiums on
securities held by the Funds are accreted and amortized to maturity using
the effective interest method. Realized gains and losses on securities sold
are determined under the identified cost method.
It is the Trust's policy to take possession of securities as collateral
under repurchase agreements and to determine on a daily basis that the value
of such securities is sufficient to cover the value of the repurchase
agreements.
DISTRIBUTIONS--Distributions to shareholders are recorded on the ex-dividend
date.
ACCOUNTING ESTIMATES--The preparation of financial statements in accordance
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts
of increases and decreases in net assets from operations during the
reporting periods. Actual results could differ from those estimates.
37
<PAGE>
NOTES TO FINANCIAL STATEMENTS
3. MANAGEMENT FEES AND TRANSACTION WITH AFFILIATES
The Trust, on behalf of the Funds, entered into an Investment Advisory Agreement
(the "Agreement") with Jurika & Voyles, L.P., (the "Adviser"). Under the terms
of the Agreement, the Funds will pay a fee equal to the following rates of
average daily net assets: 1.00% for the Mini-Cap Fund, 0.85% for the
Value+Growth Fund and 0.70% for the Balanced Fund. The Adviser has voluntarily
agreed to the expense limitation described herein for an indefinite period of
time, by reducing all or a portion of its fees (and reimbursing the Funds'
expenses) so that the ratio of expenses to average net assets will not exceed
1.50% for Mini-Cap Fund, 1.25% for the Value+Growth Fund, and 0.95% for the
Balanced Fund. Fee waivers and expense reimbursements are voluntary and may be
terminated at any time. In subsequent years, overall operating expenses of each
Fund will not fall below the applicable expense limitations until the Adviser
has been fully reimbursed for fees foregone or expenses paid by the Adviser
under this agreement, as each Fund will reimburse the Advisor in subsequent
years when operating expenses (before reimbursement) are less than the
applicable percentage limitation. The agreement permits such reimbursement to
the Adviser within the three year period following the year in which the Adviser
waived fees or reimbursed expenses of the Fund. Unreimbursed expenses at June
30, 1999 amounted to $224,973, $379,196 and $390,328 for the Mini-Cap,
Value+Growth and Balanced Funds, respectively.
Included in the statements of operations under the caption Transfer Agent Fees,
are fees of $243, $242 and $364 for the Mini-Cap, Value+Growth and Balanced
Funds, respectively, due to NVEST Services Company, Inc., an affiliate of the
adviser, as servicing agent to the Funds.
Pursuant to a Shareholder Services Plan, the Funds will reimburse the Adviser
for any expenses incurred, not to exceed 0.25% of each Fund's average daily net
assets, for shareholder services provided. Under the Shareholders Services Plan,
the Adviser as Service Coordinator will provide, or will arrange for others to
provide, certain specified shareholder services to shareholders of the Funds. In
certain cases, the Adviser may also pay a fee, out of its own resources and not
out of the service fee payable under the Shareholder Services Plan, to a
participating organization for providing other administrative services to its
customers who invest in shares of the Funds.
The Trust, on behalf of the Funds, entered into an Administration Agreement (the
"Administration Agreement") with Investment Company
38
<PAGE>
NOTES TO FINANCIAL STATEMENTS
3. MANAGEMENT FEES AND TRANSACTION WITH AFFILIATES--CONTINUED
Administration, L.L.C. (the "Administrator"). Under the terms of the
Administration Agreement, the Funds will pay a fee, payable monthly and computed
based on the value of the total average net assets of the Trust at an annual
rate of 0.10% of the first $100 million of such net assets, 0.05% of the next
$150 million, 0.03% of the next $250 million and 0.01% thereafter, subject to a
minimum fee of $40,000 per annum per Fund. Prior to January 1, 1999 the minimum
fee was $50,000 per Fund.
First Fund Distributors, Inc. (the "Distributor") distributes the Funds' shares
pursuant to a Distribution Agreement. The Distributor is an affiliate of the
Administrator.
Certain officers of the Adviser, Administrator and Distributor are also officers
and/or Trustees of the Funds.
Each unaffiliated Trustee receives as compensation $5,000 per year plus an
attendance fee of $500 for each Trustees' meeting attended. Compensation paid to
the Trustees is allocated to the Funds evenly.
4. PURCHASES AND SALES OF SECURITIES
The cost of security purchases and the proceeds from security sales, other than
short-term investments for the year ended June 30, 1999, are as follows:
<TABLE>
<CAPTION>
FUND PURCHASES SALES
- ---------------------------------------------- -------------- ----------------
<S> <C> <C>
Mini-Cap Fund $ 73,606,263 $ 116,611,882
Value+Growth Fund 32,793,838 43,366,993
Balanced Fund 50,744,211 63,455,215
</TABLE>
The total cost of securities and the aggregate gross unrealized appreciation and
depreciation for securities held by the Funds at June 30, 1999, based on cost
for federal income tax purposes, are as follows:
<TABLE>
<CAPTION>
GROSS GROSS NET
TOTAL UNREALIZED UNREALIZED UNREALIZED
FUND TAX COST APPRECIATION DEPRECIATION APPRECIATION
- ------------------------ -------------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
Mini-Cap Fund $ 27,727,788 $ 4,456,548 ($ 2,090,155) $ 2,366,393
Value+Growth Fund 32,129,367 5,835,585 (1,294,120) 4,541,465
Balanced Fund 47,726,727 6,625,142 (1,367,090) 5,258,052
</TABLE>
39
<PAGE>
NOTES TO FINANCIAL STATEMENTS
4. PURCHASES AND SALES OF SECURITIES--CONTINUED
At June 30, 1999, the Mini-Cap Fund had tax basis capital losses of $3,400,000,
which may be carried forward to offset future capital gains through June 30,
2007. At June 30, 1999, the Mini-Cap Fund has deferred capital losses occurring
subsequently to October 31, 1998, of $1,100,000. For tax purposes, such losses
will be reflected in the year ending June 30, 2000.
5. LINE OF CREDIT
The Trust has a $10 million unsecured line of credit with a group of
participating banks. The interest rate charged on borrowings is the Overnight
Federal Funds rate, plus 0.455%. Each Fund pays its pro rata share of a
commitment fee of 0.08% of the unused portion of the commitment. The Funds are
also required to pay a utilization fee of 0.05% on the principal amount
outstanding when more than 50% of total commitment is outstanding, or 0.10% when
more than 66.67% of the total commitment is outstanding. There were no
borrowings under this commitment during the year ended June 30, 1999.
40
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INDEPENDENT AUDITOR'S REPORT
To the Board of Trustees and Shareholders of
Jurika & Voyles Fund Group
We have audited the accompanying statements of assets and liabilities, including
the schedules of investments of the Jurika & Voyles Mini-Cap Fund, Jurika &
Voyles Value+Growth Fund, and Jurika & Voyles Balanced Fund, all of which are
separate series of Jurika & Voyles Fund Group (the "Trust"), as of June 30,
1999, and the related statements of operations, the statements of changes in net
assets, and the financial highlights for each of the periods indicated. These
financial statements and financial highlights are the responsibility of the
Trust's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. These standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned at June 30,
1999, by correspondence with the custodian and brokers. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of Jurika
& Voyles Mini-Cap Fund, Jurika & Voyles Value+Growth Fund, and Jurika & Voyles
Balanced Fund as of June 30, 1999, the results of their operations, the changes
in their net assets and the financial highlights for the periods indicated in
conformity with generally accepted accounting principles.
[SIGNATURE]
New York, New York
July 23, 1999
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Jurika & Voyles Fund Group
P.O. Box 9291
Boston, MA 02266-9291
(800) JV-INVST
(800) 584-6878
