KIEWIT MUTUAL FUND
MONEY MARKET PORTFOLIO
SHORT-TERM GOVERNMENT PORTFOLIO
INTERMEDIATE-TERM BOND PORTFOLIO
TAX-EXEMPT PORTFOLIO
EQUITY PORTFOLIO
KIEWIT
KMF
MUTUAL FUND
ANNUAL REPORT
JUNE 30, 1996
Kiewit
KMF
Mutual Fund
Dear Shareholder:
The management of Kiewit Mutual Fund is pleased to report to you
on the Fund's activity for the fiscal year ended June 30, 1996.
The investment results reported in the charts contained in this
letter are measured from December 6, 1994 (the date the Fund's
registration statement under the Securities Act of 1933 became
effective), except for the Kiewit Equity Portfolio which commenced
operations on January 5, 1995. However, the portions of the annual
report following this letter show the financial operation, condition
and results of each Portfolio from inception through the fiscal year
ended June 30, 1996.*
Investment Results**
The Money Market Portfolio's total return for the fiscal year
ended June 30, 1996 was 5.61%. That return consisted of income
distributions (dividends) of $0.05 per share. The Portfolio's
return compares favorably with the 5.28% total return reported
for Donoghue's Money Market Fund Average over the same period.
The Short-Term Government Portfolio's total return for the
fiscal year was 4.66%. That return consisted of a decrease in
net asset value of $0.03 per share (decreasing from $2.03 to
$2.00) and income distributions (dividends) of $0.12 per share.
The Portfolio's return falls short of the 5.48% total return
reported for the unmanaged Lehman 1-3 Year Government Index
over the same period. The Lehman 1-3 Year Government Index
is a total return performance benchmark consisting of U.S.
Government agency and Treasury securities with maturities
from one to three years. Following is a chart that represents
the performance of the Portfolio and the unmanaged Lehman 1-3
Year Government Index since the Portfolio's effective date
on December 6, 1994 through the end of June 1996.
* The Money Market Portfolio commenced operations on July
28, 1994; the Short-Term Government Portfolio commenced operations
on July 29, 1994; the Intermediate-Term Bond Portfolio and
the Tax-Exempt Portfolio each commenced operations on July
25, 1994; and the Equity Portfolio commenced operations on
January 5, 1995.
** Past performance is not necessarily predictive of future
results. There can be no assurance that the Money Market Portfolio
will be able to maintain a stable net asset value of $1.00.
An investment in the Money Market Portfolio is neither insured
nor guaranteed by the U.S. Government. The returns shown above
are higher due to the Adviser's maintenance of the Portfolios'
expenses. See Financial Highlights on pages 11, 18, 25, 34 and
40.
Comparison of Change in Value of $10,000 Investment***
- ---------------------------------------------------
[Insert graph]
12-6-94 6-30-95 6-30-96
------- ------- -------
Kiewit Short-Term Government Portfolio 10,000 10,618 11,113
Lehman 1-3 Year Government Index 10,000 10,679 11,265
Avg. Annual Total Return
Effective
1 Year Date
------ --------
Fund 4.66% 6.96%
Index 5.48% 7.88%
*** Past performance is not predictive of future results.
The Intermediate-Term Bond Portfolio's total return for the
fiscal year was 4.48%. That return consisted of a decrease in
net asset value of $0.04 per share (decreasing from $2.05 to $2.01)
and income distributions (dividends) of $0.13 per share. The
Portfolio's return falls short of the 5.33% total return reported
for the unmanaged Lehman Intermediate Corporate Index over the
same period. The Lehman Intermediate Corporate Index is a total
return performance benchmark consisting of publicly issued corporate
debt issues rated at least investment grade with maturities from
one to ten years. Below is a chart that represents the performance
of the Portfolio and the unmanaged Lehman Intermediate Corporate
Index since the Portfolio's effective date on December 6, 1994
through the end of June 1996.
Comparison of Change in Value of $10,000 Investment***
- ---------------------------------------------------
[Insert graph]
12-6-94 6-30-95 6-30-96
------- ------- -------
Kiewit Intermediate-Term Bond 10,000 10,863 11,350
Lehman Intermediate Corporate Index 10,000 11,248 11,847
Avg. Annual Total Return
Effective
1 Year Date
------ --------
Fund 4.48% 8.40%
Index 5.33% 11.40%
*** Past performance is not predictive of future results.
The Tax-Exempt Portfolio's total return for the fiscal year
was 4.55%. That return consisted of income distributions (dividends)
of $0.09 per share. The Portfolio's return falls short of the
5.05% total return reported for the unmanaged Lehman 5-Year
Municipal Bond Index. The Lehman 5-Year Municipal Bond Index
is a total return performance benchmark consisting of tax-exempt
municipal bonds rated at least investment grade with maturities
from four to six years. Below is a chart that represents the
performance of the Portfolio and the unmanaged Lehman 5-Year
Municipal Bond Index since the Portfolio's effective date on
December 6, 1994 through the end of June 1996.
Comparison of Change in Value of $10,000 Investment***
- ---------------------------------------------------
[Insert graph]
12-6-94 6-30-95 6-30-96
------- ------- -------
Kiewit Tax-Exempt Portfolio 10,000 10,573 11,054
Lehman 5-Year Municipal Bond Index 10,000 10,804 11,350
Avg. Annual Total Return
Effective
1 Year Date
------ --------
Fund 4.55% 6.59%
Index 5.05% 8.40%
*** Past performance is not predictive of future results.
The Equity Portfolio's total return for the fiscal year
was 19.24%. That return consisted of an increase in net asset
value per share of $2.54 (increasing from $14.04 to $16.58)
and income distributions (dividends) of $0.15 per share. The
Portfolio's return falls short of the 26% total return reported
for the unmanaged Standard & Poor's 500 Index (the "S&P 500").
The S&P 500 is an unmanaged capitalization weighted index of
five hundred publicly traded stocks. Below is a chart that
represents the performance of the Portfolio and S&P 500 since
the Portfolio's inception on January 5, 1996.
Comparison of Change in Value of $10,000 Investment***
- ---------------------------------------------------
[Insert graph]
1-5-95 6-30-95 6-30-96
------- ------- -------
Kiewit Equity Portfolio 10,000 11,232 13,393
S&P 500 Index 10,000 11,980 15,095
Avg. Annual Total Return
Effective
1 Year Date
------ --------
Fund 19.24% 21.70%
Index 26.00% 31.89%
*** Past performance is not predictive of future results.
Please note that the Lehman indices and S&P 500 are
unmanaged statistical compilations, and unlike the Kiewit
Portfolios have no associated expenses.
As of July 1, 1996, Kiewit Investment Management Corp.
("KIM"), the investment manager of each Portfolio, agreed to
continue its support of the Portfolios' returns by waiving all
or a portion of its advisory fee and assuming certain Fund
expenses in an amount that will limit annual operating expenses
to not more than the following percentages of the average daily
net assets of the Portfolios: Money Market Portfolio - .20%;
Short-Term Government Portfolio - .30%; Intermediate-Term Bond
Portfolio - .50%; Tax-Exempt Portfolio - .50% and Equity Portfolio
- .80%. These limitations aided the competitive returns of
each Portfolio.
Market Review and Preview
Since the issuance of our semi-annual report for the
period ended December 31, 1995, the financial markets have
experienced considerable volatility. As we exited 1995, concern
about possible softness in the economy had some market observers
expecting additional Federal Reserve Board (the "Fed") easing
of short-term interest rates. Others believed that the Fed would
wait several months to see the effect on the economy of its
1995 rate cuts before considering further action to stimulate
the economy. Adding to the uncertainty was the unknown magnitude
of the negative impacts of the severe winter weather in much of
the U.S. during the first quarter, along with the temporary
government shut-down caused by the stalemate between the
legislative and the executive branches of the Federal
government. Many viewed these two events as random shocks,
the type the Fed had frequently ignored in the past when
setting monetary policy. Would the Fed choose to ignore
those events this time?
Market volatility was compounded by the apparent death
of the proposed balanced budget. During late 1995 and early
1996, fixed income investors had been bullish on bonds due
to the belief that significant spending restraint (and
therefore less future borrowing) would be imposed on the
Federal Government as Congress tried to force a balanced
budget by early in the next millennium. As it became apparent
that the chances of that happening were remote, intermediate-
and long-term rates started moving upward. Investor
enthusiasm over a balanced budget had moved rates below
sustainable levels, and higher rates were inevitable when
that enthusiasm dissipated.
As the second quarter unfolded and the results of the
economy's performance in the first quarter were released,
the numbers proved to be stronger than expected. This data
was accompanied by strong upward moves in the price of gold
and oil, two barometers frequently watched for signs of future
price trends. Immediately, market participants stopped debating
when the next Fed easing would take place and started debating
how quickly the Fed would move to raise interest rates. This
caused intermediate and long-term interest rates to rise even
further as it appeared that the increase earlier in the year was
not just a temporary detour on the path to lower rates but
rather a new path altogether - one leading to higher rates
for the foreseeable future. The net effect was a bond market
that reminded investors of 1994 as the market suffered
another one of its worst six month performances in market
history. Bondholders saw major price declines, steep enough
to more than offset coupon income, giving many investors
negative total returns for the first six months of the year.
Surprisingly, the equity markets were able to ignore
most of the turmoil in the fixed income markets. Individuals
looking to get in on the action in the equity market poured
record amounts of money into equity mutual funds. Money flowing
into mutual funds drove up the demand for shares of stock,
which drove up share prices, which drove up cash flows into
mutual funds, which drove up demand for stock, and on and on.
Although higher interest rates on fixed income securities
typically give equities competition for the investor's dollar,
many investors have apparently decided (at least until they
experience a bear market) that equities are the place to invest,
and only fools would settle for the "low" returns offered by
fixed income securities. For most of the first six months of
the year it seemed as though, when it came to the stock market,
"this time it was different." However, stocks should eventually
trade based upon their underlying fundamentals, at which time
those that have loaded their portfolios with common stock
"because you can't go wrong with common stock" will likely
suffer much larger losses than they ever anticipated.
The Portfolios of the Kiewit Mutual Fund are currently
positioned with the expectation that the next six months
will be difficult ones for investors in both the fixed
income and equity markets. We are allowing our cash balances
to rise in the anticipation that we will be able to purchase
securities at more attractive levels in the next six months
than are available currently.
Sincerely,
Ann C. McCulloch
August 14, 1996 President
KIEWIT MUTUAL FUND/MONEY MARKET PORTFOLIO
- -----------------------------------------
Investments/June 30, 1996
(Showing Percentage of Total Value of Net Assets)
- ------------------------------------------------------------------------
Moody's/S&P Principal Value
Rating* Amount (Note 2)
----------- --------- -------
Commercial Paper- 92.8%
Automobiles - 5.1%
Daimler-Benz North America Corp., 5.30% -
5.37%, 07/09/96 - 09/18/96 P-1/A-1 $20,000,000 $19,935,129
Banks - 5.3%
Commerzbank US Finance Inc., 5.40%,
08/09/96 P-1/A-1+ 2,000,000 1,988,387
Suntrust Banks, Inc., 5.41%, 10/22/96 P-1/A-1 19,000,000 18,685,703
20,674,090
Business Services - 4.6%
PHH Corp., 5.31% - 5.42%, 07/08/96 -
08/19/96 P-1/A-1 18,000,000 17,930,986
Chemicals - 2.3%
E.I. DuPont De Nemours, 5.31% - 5.42%,
07/12/96 - 08/23/96 P-1/A-1+ 9,100,000 9,059,473
Electronics - 4.8%
General Electric Co., 5.38%, 09/13/96 P-1/A-1+ 19,000,000 18,794,568
Finance - 6.8%
BAT Capital Corp., 5.33%, 07/02/96 P-1/A-1 20,000,000 19,997,061
Mitsubishi Motors Credit of America, Inc.,
5.45% - 5.48%, 07/25/96 - 08/05/96 P-1/A-1+ 6,727,000 6,695,686
26,692,747
Financial Services - 15.2%
Ford Motor Credit Corp., 5.31%, 07/19/96 P-1/A-1 22,000,000 21,942,580
General Electric Capital Corp., 5.03% -
5.68%, 07/26/96 - 02/04/97 P-1/A-1+ 18,500,000 18,304,221
Orix America Inc., 5.36% - 5.54%,
07/01/96 - 08/01/96 P-1/A-1+ 19,000,000 18,965,737
59,212,538
Food & Beverages - 2.0%
McCormick & Co., 5.42%, 07/29/96 P-1/A-1 5,000,000 4,979,039
PepsiCo. Inc., 5.43%, 09/09/96 P-1/A-1 2,658,000 2,630,298
7,609,337
Games & Toys - 4.6%
Hasbro Inc., 5.32% - 5.46%,
07/22/96 - 09/20/96 P-1/A-1 18,100,000 17,986,450
Hardware & Tools - 0.5%
Stanley Works, 5.44%, 07/30/96 P-1/A-1 2,000,000 1,991,284
Leasing - 9.2%
Hertz Corp., 5.36%, 07/23/96 P-1/A-1 19,000,000 18,938,693
International Lease Finance Corp., 5.33% -
5.36%, 08/12/96 - 08/19/96 P-1/A-1 17,000,000 16,885,013
35,823,706
Office Equipment - 7.1%
Hewlett Packard Co., 5.44% - 5.45%,
09/24/96 - 9/27/96 P-1/A-1+ 9,600,000 9,476,056
TDK USA Corp., 5.37% - 5.42%,
07/17/96 - 10/21/96 P-1/A-1+ 18,300,000 18,041,539
27,517,595
Moody's/S&P Principal Value
Rating* Amount (Note 2)
----------- --------- -------
Pharmaceuticals Preparations - 6.9%
Sandoz Corp., 5.31% -5.40%,
07/11/96 - 08/09/96 P-1/A-1+ 17,000,000 16,944,639
The accompanying notes are an integral part of the financial statements.
KIEWIT MUTUAL FUND/MONEY MARKET PORTFOLIO
- -----------------------------------------
Investments/June 30, 1996 - continued
- --------------------------------------------------------------------------
Schering Corp., 5.44%, 09/17/96 P-1/A-1+ 10,000,000 9,883,758
26,828,397
Publishing - 3.6%
Dow Jones & Co., 5.36% - 5.38%,
07/10/96 - 07/31/96 P-1/A-1+ 14,100,000 14,056,754
Retail Merchandising - 5.1%
Nordstrom Credit, Inc., 5.37%, 07/08/96 P-1/A-1 3,000,000 2,996,879
Penney (J.C.) Funding Corp., 5.34% -
5.41%, 07/12/96 - 08/19/96 P-1/A-1 17,000,000 16,932,767
19,929,646
Securities Dealers - 4.6%
CS First Boston Group, Inc. 5.33% -
5.46%, 07/15/96 -08/29/96 P-1/A-1 18,000,000 17,908,497
Utilities - 5.1%
AT&T Corp., 5.35%, 08/16/96 P-1/A-1+ 15,000,000 14,898,992
Consolidated Natural Gas, 5.41%, 08/08/96 P-1/A-1+ 5,000,000 4,971,605
19,870,597
TOTAL COMMERCIAL PAPER (COST $361,821,794) 361,821,794
Corporate Bonds - 0.5%
Gillette Co., 5.55%, 08/15/96
(COST $1,897,649) Aa3/AA- 1,900,000 1,897,649
U.S. Government Agency Obligations - 1.0%
Federal Farm Credit Banks, 5.56%,
01/02/97 (COST $3,998,125) NR/NR 4,000,000 3,998,125
Repurchase Agreement - 7.1%
With Paine Webber Group, Inc.: At 5.55% Dated
06/28/96, To Be Repurchased At $27,808,355
On 07/01/96, Collateralized By Federal Home
Loan Mortgage Corporation Securities With
Various Coupons And Maturities To 02/01/23
(Market Value $26,860,756) And Federal
National Mortgage Association Securities With
Various Coupons And Maturities To 02/01/13
(market value $1,491,695) (COST $27,795,500) 27,795,500
TOTAL INVESTMENTS (COST $395,513,068)+ - 101.4% 395,513,068
OTHER ASSETS AND LIABILITIES, NET - (1.4)% _(5,546,531)
NET ASSETS - 100.0% $389,966,537
===========
* Unaudited
+ Cost for federal income tax and financial reporting purposes.
NR Not Rated. While not rated by Moody's or S&P, U.S. Government
Agency Obligations and Mortgage Backed Securities are considered to
be of the highest quality, comparable to AAA.
The accompanying notes are an integral part of the financial statements.
KIEWIT MUTUAL FUND/MONEY MARKET PORTFOLIO
- ---------------------------------------------------------------------------
FINANCIAL STATEMENTS
- ---------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
June 30, 1996
Assets:
Investments in securities (including repurchase agreement
of $27,795,500), at value (amortized cost $395,513,068)
(Note 2) $395,513,068
Cash 176
Interest receivable 46,934
Unamortized organization costs (Note 2) 21,505
Other assets 2,722
-----------
Total assets 395,584,405
Liabilities:
Dividends payable $1,545,292
Payable for investment securities purchased 3,998,125
Accrued management fee (Note 4) 27,406
Other accrued expenses (Note 4) 47,045
---------
Total liabilities 5,617,868
-----------
Net Assets $389,966,537
============
Net Assets consist of:
Shares of beneficial interest $ 3,899,681
Additional paid-in capital 386,068,451
Accumulated net realized loss on investments (1,595)
-------------
Net Assets, for 389,968,132 shares outstanding $389,966,537
============
Net Asset Value, offering and redemption price per share
($389,966,537 divided by 389,968,132 outstanding shares
of beneficial interest, $0.01 par value, unlimited number
of shares authorized) $1.00
=====
The accompanying notes are an integral part of the financial statements.
KIEWIT MUTUAL FUND/MONEY MARKET PORTFOLIO
- -----------------------------------------------------------------------------
FINANCIAL STATEMENTS - continued
- -----------------------------------------------------------------------------
STATEMENT OF OPERATIONS
For the Fiscal Year Ended June 30, 1996
Interest income $23,932,571
Expenses:
Management fee (reflects $298,011 waiver) (Note 4) $ 545,978
Administration fee (Note 4) 50,000
Accounting fee (Note 4) 77,547
Transfer Agent fee (Note 4) 21,035
Custodian fee (Note 4) 58,704
Trustees' fees and expenses (Note 4) 5,000
Amortization of organizational expenses (Note 2) 6,833
Registration fees 32,428
Legal 10,713
Audit 15,132
Other 20,631
--------
Total expenses, net 844,001
-----------
Net investment income 23,088,570
-----------
Net realized loss on investments (704)
------------
Net increase in net assets resulting from operations $23,087,866
===========
The accompanying notes are an integral part of the financial statements.
KIEWIT MUTUAL FUND/MONEY MARKET PORTFOLIO
- ------------------------------------------------------------------------------
FINANCIAL STATEMENTS - continued
- ------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
For the Period
July 28, 1994
For the Fiscal Year (Commencement of
Ended Operations) through
June 30, 1996 June 30, 1995
------------------- -------------------
Increase (Decrease) in Net Assets:
Operations:
Net investment income $ 23,088,570 $ 10,416,304
Net realized loss on investments (704) (891)
--------------- ---------------
Net increase in net assets resulting
from operations 23,087,866 10,415,413
--------------- ---------------
Distributions to shareholders from
net investment income ($0.055 and
$0.049 per share, respectively) (23,088,570) (10,416,304)
--------------- ---------------
Share transactions at net asset
value of $1.00 per share:
Proceeds from sale of shares 2,492,777,762 1,333,908,405
Shares issued to shareholders in
reinvestment of dividends from
net investment income 22,304,714 8,841,448
Cost of shares redeemed (2,505,823,180) (962,141,017)
-------------- -------------
Net increase in net assets and
shares resulting from share
transactions 9,259,296 380,608,836
-------------- -------------
Total increase in net assets 9,258,592 380,607,945
Net Assets:
Beginning of period 380,707,945 100,000
-------------- --------------
End of period $ 389,966,537 $ 380,707,945
=============== ===============
The accompanying notes are an integral part of the financial statements.
KIEWIT MUTUAL FUND/MONEY MARKET PORTFOLIO
- ---------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- ---------------------------------------------------------------------------
The following table includes selected data for a share outstanding throughout
each period.
For the Period
July 28, 1994
For the Fiscal Year (Commencement of
Ended Operations) through
June 30, 1996 June 30, 1995
------------------- -------------------
Net Asset Value - Beginning of Period $1.00 $1.00
----- -----
Investment Operations:
Net investment income 0.05 0.05
----- -----
Distributions:
From net investment income (0.05) 0.05)
----- -----
Net Asset Value - End of Period $1.00 $1.00
===== =====
Total Return 5.61% 5.04%**
Ratios (to average net assets)/Supplemental Data:
Expenses + 0.20% 0.30%*
Net investment income 5.47% 5.51%*
Net assets at end of period $ 389,966,537 $ 380,707,945
- ------------------------------
* Annualized
** The total return for the period ended June 30, 1995 has not been
annualized.
+ Since inception, Kiewit Investment Management Corp. (the "Manager")
agreed to waive all or a portion of its fee. For the period from
December 7, 1994 through June 30, 1995, the Manager further agreed to
waive all or a portion of its fee in an amount that will limit annual
operating expenses to not more than 0.30% of the average daily net
assets of the Portfolio. Effective July 1, 1995 through June 30,
1997, the Manager agreed to waive all or a portion of the its fee
in an amount that will limit annual operating expenses to not more
than 0.20% of the average daily net assets of the Portfolio. The
annualized expense ratio, had there been no fee waivers by the
Manager, would have been 0.27% and 0.34% for the fiscal year ended
June 30, 1996, and for the period ended June 30, 1995,
respectively.
The accompanying notes are an integral part of the financial
statements.
This page is intentionally left blank.
KIEWIT MUTUAL FUND/SHORT-TERM GOVERNMENT PORTFOLIO
- --------------------------------------------------
Investments/June 30, 1996
(Showing Percentage of Total Value of Net Assets)
- ------------------------------------------------------------------------------
Principal Value
Amount (Note 2)
------ --------
U.S. Government Agency Obligations - 51.8%
Federal Home Loan Banks Notes - 10.8%
Federal Home Loan Banks, 5.545%, 06/09/97 $ 5,000,000 $ 4,982,000
Federal Home Loan Banks, 6.15%, 04/01/98 5,000,000 4,967,600
Federal Home Loan Banks, 5.215%, 07/08/98 5,000,000 4,890,199
Federal Home Loan Banks, 5.86%, 01/25/99 5,000,000 4,912,500
-----------
19,752,299
-----------
Federal Home Loan Mortgage Corporation Notes - 12.1%
Federal Home Loan Mtge. Corp., 7.86%, 01/21/97 5,000,000 5,056,849
Federal Home Loan Mtge. Corp., 8.20%, 01/16/98 3,000,000 3,029,880
Federal Home Loan Mtge. Corp., 5.825%, 08/11/98 4,195,000 4,144,450
Federal Home Loan Mtge. Corp., 6.28%, 10/02/98 1,000,000 994,710
Federal Home Loan Mtge. Corp., 6.38%, 10/02/98 4,650,000 4,634,981
Federal Home Loan Mtge. Corp., 5.37%, 12/07/98 4,500,000 4,397,804
-----------
22,258,674
-----------
Federal National Mortgage Association Discount Notes - 2.0%
Federal National Mtge. Assoc. Principal Strip, 7.56%,
12/20/01, Callable 12/20/96 at 100 3,750,000 3,637,462
-----------
Federal National Mortgage Association Notes - 22.1%
Federal National Mtge. Assoc., 6.84%, 10/03/97 5,000,000 5,051,849
Federal National Mtge. Assoc., 5.00%, 02/25/98 2,000,000 1,956,940
Federal National Mtge. Assoc., 5.20%, 07/10/98 10,310,000 10,080,086
Federal National Mtge. Assoc., 5.77%, 08/25/98 2,900,000 2,861,256
Federal National Mtge. Assoc., 4.875%, 10/15/98 2,850,000 2,762,647
Federal National Mtge. Assoc., 4.75%, 10/26/98 3,620,000 3,499,563
Federal National Mtge. Assoc., 4.94%, 10/30/98 5,000,000 4,853,200
Federal National Mtge. Assoc., 7.46%, 09/27/99 5,000,000 5,006,199
Federal National Mtge. Assoc., 6.37%, 07/27/00 1,500,000 1,479,060
Federal National Mtge. Assoc., 5.84%, 03/15/01 3,000,000 2,897,908
-----------
40,448,708
-----------
Student Loan Marketing Association Notes - 2.2%
Student Loan Marketing Assoc., 6.97%, 08/23/00 4,000,000 4,000,520
-----------
Tennessee Valley Authority Notes - 2.6%
Tennessee Valley Auth. Global Power, Ser. D,
6.00%, 11/01/00 5,000,000 4,856,250
-----------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS
(COST $94,714,216) 94,953,913
-----------
U.S. Treasury Notes - 46.2%
U.S. Treasury Notes, 6.25%, 08/31/96 10,000,000 10,013,800
U.S. Treasury Notes, 7.25%, 11/30/96 7,000,000 7,049,419
U.S. Treasury Notes, 6.125%, 05/31/97 15,000,000 15,047,249
U.S. Treasury Notes, 5.875%, 07/31/97 10,000,000 10,002,999
U.S. Treasury Notes, 5.00%, 01/31/98 9,000,000 8,861,489
U.S. Treasury Notes, 7.25%, 02/15/98 2,000,000 2,036,960
U.S. Treasury Notes, 5.125%, 02/28/98 5,000,000 4,928,400
U.S. Treasury Notes, 5.875%, 08/15/98 5,000,000 4,972,600
U.S. Treasury Notes, 6.375%, 01/15/99 5,000,000 5,016,599
U.S. Treasury Notes, 7.75%, 01/31/00 5,000,000 5,212,700
U.S. Treasury Notes, 5.625%, 11/30/00 12,000,000 11,621,160
-----------
Total U.S. Treasury Notes (Cost $85,341,116) 84,763,375
-----------
The accompanying notes are an integral part of the financial statements.
KIEWIT MUTUAL FUND/SHORT-TERM GOVERNMENT PORTFOLIO
- --------------------------------------------------
Investments/June 30, 1996 - continued
- ------------------------------------------------------------------------------
Value
(Note 2)
--------
Repurchase Agreement - 0.8%
With Paine Webber Group, Inc.: at 5.55%, dated 06/28/96
to be repurchased at $1,365,631 on 07/01/96, collateralized
by Federal Home Loan Mortgage Corporation securities with
various coupons and maturities to 09/01/25 (market value
$1,386,483) and Federal National Mortgage Association
security with a coupon of 5.50% and due 05/01/11
(market value $32,096) (COST $1,365,000) $1,365,000
----------
Total Investments (Cost $181,420,332)+ - 98.8% 181,082,288
Other Assets and Liabilities, Net - 1.2% 2,233,734
------------
NET Assets - 100.0% $183,316,022
============
+ Cost for federal income tax and financial reporting purposes.
At June 30, 1996, net unrealized depreciation was $338,044. This
consisted of aggregate gross realized appreciation for all securities
in which there was an excess of market value over cost of $912,528
and aggregate gross unrealized depreciation for all securities in
which there was an excess of cost over market value of $1,250,572.
The accompanying notes are an integral part of the financial statements.
KIEWIT MUTUAL FUND/SHORT-TERM GOVERNMENT PORTFOLIO
- ---------------------------------------------------------------------------
FINANCIAL STATEMENTS
- ---------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
June 30, 1996
Assets:
Investments in securities (including repurchase
agreement of $1,365,000), at value (amortized
cost $181,420,332) (Note 2) $181,082,288
Cash 841
Receivable for Fund shares sold 57,586
Interest receivable 3,087,025
Unamortized organization costs (Note 2) 21,523
Other assets 1,058
-------------
Total assets 184,250,321
Liabilities:
Dividends payable $876,788
Accrued management fee (Note 4) 8,035
Other accrued expenses (Note 4) 49,476
--------
Total liabilities 934,299
------------
Net Assets $183,316,022
============
Net Assets consist of:
Shares of beneficial interest $ 914,572
Additional paid-in capital 182,841,015
Accumulated net realized loss on investments (101,521)
Net unrealized depreciation of investments (338,044)
------------
Net Assets, for 91,457,162 shares outstanding $183,316,022
============
Net Asset Value, offering and redemption price per share
($183,316,022 divided by 91,457,162 outstanding shares
of beneficial interest, $0.01 par value, unlimited number
of shares authorized)
$2.00
=====
The accompanying notes are an integral part of the financial statements.
KIEWIT MUTUAL FUND/SHORT-TERM GOVERNMENT PORTFOLIO
- ---------------------------------------------------------------------------
FINANCIAL STATEMENTS - continued
- ---------------------------------------------------------------------------
STATEMENT OF OPERATIONS
For the Fiscal Year Ended June 30, 1996
Interest income $10,428,919
Expenses:
Management fee (reflects $219,505 waiver) (Note 4) $ 272,667
Administration fee (Note 4) 50,000
Accounting fee (Note 4) 54,591
Transfer Agent fee (Note 4) 20,701
Custodian fee (Note 4) 23,332
Trustees' fees and expenses (Note 4) 5,000
Amortization of organizational expenses (Note 2) 6,833
Registration fees 29,832
Legal 4,978
Audit 14,802
Other 9,444
---------
Total expenses, net 492,180
-----------
Net investment income 9,936,739
-----------
Realized and unrealized gain (loss) on investments:
Net realized gain on investment transactions 325,356
Net change in unrealized depreciation of investments (2,131,628)
-----------
Net loss on investments (1,806,272)
Net increase in net assets resulting from operations $ 8,130,467
===========
The accompanying notes are an integral part of the financial statements.
KIEWIT MUTUAL FUND/SHORT-TERM GOVERNMENT PORTFOLIO
- ---------------------------------------------------------------------------
FINANCIAL STATEMENTS - continued
- ---------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
For the Period
July 29, 1994
For the Fiscal Year (Commencement of
Ended Operations) through
June 30, 1996 June 30, 1995
------------------- -------------------
Increase (Decrease) in Net Assets:
Operations:
Net investment income $ 9,936,739 $ 6,378,385
Net realized gain (loss) on
investment transactions 325,356 (426,877)
Net change in unrealized appreciation
(depreciation) of investments (2,131,628) 1,793,584
------------ ------------
Net increase in net assets resulting
from operations 8,130,467 7,745,092
------------ ------------
Distributions to shareholders from
net investment income ($0.123 and
$0.106 per share, respectively) (9,936,739) (6,378,385)
------------ ------------
Fund Share Transactions (a):
Receipt from shares sold 79,791,554 255,654,892
Receipt from shares issued on
reinvestment of distributions 9,617,201 5,738,895
Shares redeemed (37,114,026) (129,932,929)
------------ ------------
Net increase in net assets from Fund
share transactions 52,294,729 131,460,858
------------ ------------
Total increase in net assets 50,488,457 132,827,565
Net Assets:
Beginning of period 132,827,565 0
------------ ------------
End of period $ 183,316,022 $132,827,565
============= ============
(a) Transactions in capital stock were:
Shares sold 39,449,589 127,758,308
Shares issued on reinvestment of
distributions 4,746,836 2,874,102
Shares redeemed (18,301,375) (65,070,298)
Net increase in shares 25,895,050 65,562,112
Shares outstanding - Beginning
balance 65,562,112 0
----------- -----------
Shares outstanding - Ending balance 91,457,162 65,562,112
=========== ==========
The accompanying notes are an integral part of the financial statements.
KIEWIT MUTUAL FUND/SHORT-TERM GOVERNMENT PORTFOLIO
- ---------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- ---------------------------------------------------------------------------
The following table includes selected data for a share outstanding throughout
each period.
For the Period
July 29, 1994
For the Fiscal Year (Commencement of
Ended Operations) through
June 30, 1996 June 30, 1995
------------------- -------------------
Net Asset Value - Beginning of Period $2.03 $2.00
----- -----
Investment Operations:
Net investment income 0.12 0.11
Net realized and unrealized gain
(loss) on investments (0.03) 0.03
----- ----
Total from investment operations 0.09 0.14
----- ----
Distributions:
From net investment income (0.12) (0.11)
----- ----
Net Asset Value - End of Period $2.00 $2.03
===== =====
Total Return 4.66% 7.00%**
Ratios (to average net assets)/Supplemental Data:
Expenses + 0.30% 0.37%*
Net investment income 6.06% 5.75%*
Portfolio turnover rate 57.52% 122.58%*
Net assets at end of period $ 183,316,022 $ 132,828,565
- ------------------------
* Annualized
** The total return for the period ended June 30, 1995 has not been
annualized.
+ Since inception, Kiewit Investment Management Corp. (the "Manager")
agreed to waive all or a portion of its fee. For the period from December
7, 1994 through June 30, 1995, the Manager further agreed to waive all or a
portion of its fee in an amount that will limit annual operating expenses to
not more than 0.40% of the average daily net assets of the Portfolio.
Effective July 1, 1995 through June 30, 1997, the Manager agreed to waive all
or a portion of its fee in an amount that will limit annual of fee waivers
by the Manager, would have been 0.43% and 0.45% for the fiscal year
ended June 30, 1996 and for the period ended June 30, 1995, respectively.
The accompanying notes are an integral part of the financial statements.
Moody's/S&P Principal Value
Rating* Amount (Note 2)
----------- --------- -------
Corporate Bonds - 81.2%
Automobile Manufacturing - 3.1%
Chrysler Corp., 10.95%, 08/01/17 A3/A- $2,000,000 $2,180,000
Ford Motor Co., 8.875%, 04/01/06 A1/A+ 1,500,000 1,661,250
----------
3,841,250
----------
Banks - 12.9%
ABN-Amro Bank - Global Note, 7.25%, 05/31/05 Aa2/AA- 3,000,000 2,988,750
Security Pacific Corp., 6.00%, 05/01/00 A2/A 1,500,000 1,455,000
Star Bank, N.A., 6.375%, 03/01/04 A3/A- 2,000,000 1,887,500
U.S. Bancorp, 7.50%, 06/01/26,
Putable 06/01/06 @ 100 A3/A- 4,000,000 4,045,000
United Postal Savings Assoc., 9.00%, 07/26/99 Aaa/NR 1,500,000 1,608,750
World Savings and Loan Assoc., 9.90%, 07/01/00A2/A 3,620,000 3,873,400
----------
15,858,400
----------
Consumer Goods - 1.3%
Anheuser-Busch Cos., Inc., 6.90%, 10/01/02 A1/AA- 1,580,000 1,576,050
----------
Financial - 4.8%
Ford Motor Credit Corp., 6.125%, 01/09/06 A1/A+ 3,000,000 2,756,250
General Motors Acceptance Corp., 8.875%,
06/01/10, Putable 06/01/00 A3/A- 1,050,000 1,170,750
Household Finance Co., 7.65%, 05/15/07 A2/A 2,000,000 2,040,000
----------
5,967,000
----------
Foreign - 9.4%
City of Vienna, 8.00%, 11/14/96 Aaa/NR 885,000 890,531
Hanson Overseas B.V., 7.375%, 01/15/03 A3/A- 4,000,000 4,050,000
Republic of Finland, 9.625%, 04/01/28 Aa2/AA- 3,000,000 3,243,750
Swedish Export Credit, 9.875%, 03/15/38,
Callable 03/15/98 at 104.94 Aa3/AA+ 2,000,000 2,187,500
WMC Finance USA, 6.50%, 11/15/03 A2/A 1,180,000 1,141,650
11,513,431
----------
Industrial & Miscellaneous - 4.4%
Mallinckrodt Group, 6.00%, 10/15/03 A3/A- 2,000,000 1,877,500
Rohm & Haas Holdings, 9.80%, 04/15/20,
Sinking Fund 10/15/00 A1/A 3,000,000 3,560,220
---------
5,437,720
----------
Insurance - 5.2%
Cigna Corp., 9.75%, 01/05/98 A2/A 3,000,000 3,131,250
Lincoln National Corp., 7.25%, 05/15/05 A3/A 3,350,000 3,303,938
----------
6,435,188
----------
Manufacturing - 17.5%
Air Products & Chemicals, 8.50%, 04/01/06-04 A2/A 3,000,000 3,202,500
Alcan Aluminum, Inc., 9.625%, 07/15/19 - 99 A2/A- 5,000,000 5,537,500
Consolidated Coal, 8.21%, 06/21/04 A2/A- 3,250,000 3,410,160
Enclean Inc., 7.50%, 08/01/01 - 96 A3/A 1,000,000 1,033,750
English China Clays Delaware Inc.,
7.375%, 10/01/02 A2/A+ 3,800,000 3,857,000
Hoechst-Celanese Corp., 6.125%, 02/01/04 A2/A+ 2,500,000 2,343,750
Monsanto Co., 8.13%, 12/15/06 A1/A 2,000,000 2,100,000
----------
21,484,660
----------
The accompanying notes are an integral part of the financial statements.
KIEWIT MUTUAL FUND/INTERMEDIATE-TERM BOND PORTFOLIO
- ---------------------------------------------------
Investments/June 30, 1996 - continued
- ------------------------------------------------------------------------------
Moody's/S&P Principal Value
Rating* Amount (Note 2)
----------- --------- -------
Merchandising & Retail - 5.0%
Mercantile Stores, Inc., 6.70%,
09/15/02 - 97 A1/A+ $4,000,000 $3,990,000
The Limited, Inc., 9.125%, 02/01/01 Baa2/BBB+ 2,000,000 2,107,500
----------
6,097,500
----------
Pharmaceuticals - 3.5%
Cardinal Health Inc., 6.50%, 02/15/04 A3/A- 4,500,000 4,308,750
----------
Security & Commodity Brokers, Dealers - 6.1%
Bear Stearns Co., 6.625%, 01/15/04 A2/A 3,000,000 2,865,000
Morgan Stanley Group, Inc., 7.50%, 09/01/99 A1/A+ 3,000,000 3,060,000
Salomon, Inc., 7.75%, 05/15/00 Baa1/BBB 1,500,000 1,531,875
----------
7,456,875
----------
Transportation - 5.5%
Canadian National Railway Co.,
6.625%, 05/15/03 A1/AA- 3,000,000 2,895,000
Union Pacific Corp., 6.12%, 02/01/04 Aa3/A 4,080,000 3,840,300
----------
6,735,300
----------
Utilities - 2.5%
Indiana Michigan Power Co., Title XI,
8.05%, 01/15/98 NR/NR 135,000 135,000
Northwestern Public Service, 7.10%, 08/01/05 A2/A 3,000,000 2,955,000
----------
3,090,000
----------
TOTAL CORPORATE BONDS (Cost $100,639,187) 99,802,124
----------
Asset-Backed Securities - 1.9%
Export Funding Trust, Ser. 1994A,
7.89%, 02/15/05 (COST $2,261,612) Aaa/AAA 2,250,000 2,338,635
----------
Mortgage Backed Securities - 7.3%
Federal Home Loan Mtge. Corp., Ser. 124A
Plan C REMIC, 8.50%, 03/15/97 NR/NR 1,854,279 1,872,072
Federal Home Loan Mtge. Corp., Ser. 143A
Plan C REMIC, 8.50%, 06/15/97 NR/NR 191,685 193,524
Federal Home Loan Mtge. Corp., Ser. 125A
Plan C REMIC, 8.75%, 03/15/00 NR/NR 802,657 830,350
Federal Home Loan Mtge. Corp., Ser. 1342H,
7.50%, 08/15/07 NR/NR 2,000,000 2,002,842
Federal National Mtge. Assoc., 7.27%,
08/24/05 NR/NR 2,500,000 2,471,925
Federal National Mtge. Assoc., Pool #326277,
7.00%, 05/01/09 NR/NR 1,663,465 1,641,633
----------
TOTAL MORTGAGE BACKED SECURITIES (COST $9,079,368) 9,012,346
----------
U.S. Government Agency Obligations - 6.0%
Federal National Mtge. Assoc. Principal
Strip, 7.94%, 11/22/01, Callable
11/22/96 @ 100 NR/NR 5,000,000 4,871,750
Federal National Mtge. Assoc., 7.37%,
04/13/04, Callable 04/14/99 NR/AAA 2,500,000 2,483,350
----------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS (COST $7,419,083) 7,355,100
----------
U.S. Treasury Notes - 0.8%
U.S. Treasury Notes, 5.75%, 08/15/03
(COST $956,392) NR/NR 1,000,000 952,140
----------
The accompanying notes are an integral part of the financial statements.
KIEWIT MUTUAL FUND/INTERMEDIATE-TERM BOND PORTFOLIO
- ---------------------------------------------------
Investments/June 30, 1996 - continued
- ------------------------------------------------------------------------------
Value
(Note 2)
--------
Repurchase Agreement - 1.2%
With Paine Webber Group, Inc.: at 5.55%, dated
06/28/96, to be repurchased at $1,519,703 on 07/01/96,
collateralized by Federal Home Loan Mortgage Corporation,
pool #C00219, 8.00%, due 03/01/23 (market value $238,919),
Federal National Mortgage Association, pool #845294, due on
03/01/23 (market value $975,490), Federal Home Loan Mortgage
Corporation, pool #219023, 6.50%, due on 06/01/08 (market
value $358,051)
(COST $1,519,000) $ 1,519,000
------------
TOTAL INVESTMENTS (COST $121,874,642)+ - 98.4% 120,979,345
OTHER ASSETS AND LIABILITIES, NET - 1.6% 1,972,243
------------
NET ASSETS - 100.0% $ 122,951,588
=============
* Unaudited.
+ Cost for federal income tax and financial reporting purposes.
At June 30, 1996, net unrealized depreciation was $895,297. This
consisted of aggregate gross unrealized appreciation for all securities
in which there was an excess of market value over cost of $904,420
and aggregate gross unrealized depreciation for all securities in
which there was an excess of cost over market value of $1,799,717.
NR Not Rated. While not rated by Moody's or S&P, U.S. Government
Agency obligations and Mortgage Backed securities are considered to
be of the highest quality, comparable to AAA.
The accompanying notes are an integral part of the financial statements.
KIEWIT MUTUAL FUND/INTERMEDIATE-TERM BOND PORTFOLIO
- ------------------------------------------------------------------------------
FINANCIAL STATEMENTS
- ------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
June 30, 1996
Assets:
Investments in securities (including
repurchase agreement of $1,519,000),at
value (amortized cost $121,874,642) (Note 2) $120,979,345
Cash 727
Receivable for investment securities sold 105,909
Receivable for Fund shares sold 61,788
Interest receivable 2,476,782
Unamortized organization costs (Note 2) 21,449
Other assets 835
------------
Total assets 123,646,835
Liabilities:
Dividends payable $ 624,509
Payable for Fund shares redeemed 9,415
Accrued management fee (Note 4) 20,923
Other accrued expenses (Note 4) 40,400
---------
Total liabilities 695,247
------------
Net Assets $122,951,588
============
Net Assets consist of:
Shares of beneficial interest $ 611,766
Additional paid-in capital 123,697,752
Accumulated net realized loss on investments (462,633)
Net unrealized depreciation of investments (895,297)
------------
Net Assets, for 61,176,566 shares outstanding $122,951,588
============
Net Asset Value, offering and redemption price per share
($122,951,588 divided by 61,176,566 outstanding shares
of beneficial interest, $0.01 par value, unlimited number of shares authorized)
$2.01
=====
The accompanying notes are an integral part of the financial statements.
KIEWIT MUTUAL FUND/INTERMEDIATE-TERM BOND PORTFOLIO
- -----------------------------------------------------------------------------
FINANCIAL STATEMENTS - continued
- -----------------------------------------------------------------------------
STATEMENT OF OPERATIONS
For the Fiscal Year Ended June 30, 1996
Interest income $ 8,588,947
Expenses:
Management fee (reflects $86,597 waiver) (Note 4) $ 413,226
Administration fee (Note 4) 50,000
Accounting fee (Note 4) 51,116
Transfer Agent fee (Note 4) 20,655
Custodian fee (Note 4) 20,649
Trustees' fees and expenses (Note 4) 5,000
Amortization of organizational expenses (Note 2) 6,833
Registration fees 28,127
Legal 2,509
Audit 14,757
Other 11,922
----------
Total expenses, net 624,794
-----------
Net investment income 7,964,153
----------
Realized and unrealized gain (loss) on investments:
Net realized gain on investment transactions 244,623
Net change in unrealized depreciation of investments (2,952,477)
-----------
Net loss on investments (2,707,854)
-----------
Net increase in net assets resulting from operations $ 5,256,299
===========
The accompanying notes are an integral part of the financial statements.
KIEWIT MUTUAL FUND/INTERMEDIATE-TERM BOND PORTFOLIO
- ---------------------------------------------------
FINANCIAL STATEMENTS - continued
- ------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
For the Period
July 25, 1994
For the Fiscal Year (Commencement of
Ended Operations) through
June 30, 1996 June 30, 1995
Increase (Decrease) in Net Assets:
Operations:
Net investment income $ 7,964,153 $ 6,088,902
Net realized gain (loss) on investment
transactions 244,623 (707,256)
Net change in unrealized appreciation
(depreciation)of investments (2,952,477) 2,057,180
------------ -------------
Net increase in net assets resulting
from operations 5,256,299 7,438,826
------------ -------------
Distributions to shareholders from net
investment income
($0.131 and $0.121 per share,
respectively) (7,964,153) (6,088,902)
------------ -------------
Fund Share Transactions (a):
Receipt from shares sold 27,470,121 246,061,746
Receipt from shares issued on
reinvestment of distributions 7,652,606 5,386,685
Shares redeemed (14,483,654) (147,777,986)
------------ -------------
Net increase in net assets from Fund
share transactions 20,639,073 103,670,445
------------ -------------
Total increase in net assets 17,931,219 105,020,369
Net Assets:
Beginning of period 105,020,369 0
------------ -------------
End of period $122,951,588 $ 105,020,369
============ =============
(a) Transactions in capital stock were:
Shares sold 13,385,046 122,885,850
Shares issued on reinvestment of
distributions 3,725,531 2,700,353
Shares redeemed (7,133,718) (74,386,496)
------------ -------------
Net increase in shares 9,976,859 51,199,707
Shares outstanding - Beginning balance 51,199,707 0
------------ -------------
Shares outstanding - Ending balance 61,176,566 51,199,707
============ =============
The accompanying notes are an integral part of the financial statements.
24
KIEWIT MUTUAL FUND/INTERMEDIATE-TERM BOND PORTFOLIO
- ---------------------------------------------------
FINANCIAL HIGHLIGHTS
- ------------------------------------------------------------------------------
The following table includes selected data for a share outstanding throughout
each period.
For the Period
July 25, 1994
For the Fiscal Year (Commencement of
Ended Operations) through
June 30, 1996 June 30, 1995
Net Asset Value - Beginning of Period $2.05 $2.00
----- -----
Investment Operations:
Net investment income 0.13 0.12
Net realized and unrealized gain (loss)
on investments (0.04) 0.05
----- -----
Total from investment operations 0.09 0.17
----- -----
Distributions:
From net investment income (0.13) (0.12)
----- -----
Net Asset Value - End of Period $2.01 $2.05
----- -----
----- -----
Total Return 4.48% 8.88%**
Ratios (to average net assets)
/Supplemental Data:
Expenses + 0.50% 0.41%*
Net investment income 6.37% 6.41%*
Portfolio turnover rate 86.06% 128.95%*
Net assets at end of period $122,951,588 $105,020,369
_______
*Annualized
**The total return for the period ended June 30, 1995 has not been annualized.
+Since inception, Kiewit Investment Management Corp. (the "Manager") agreed
to waive all or portion of its fee. For the period from December 7, 1994
through June 30, 1995, the Manager further agreed to waive all or a portion
of its fee in an amount that will limit annual operating expenses to not
more than 0.40% of the average daily net assets of the Portfolio. Effective
July 1, 1995 through June 30, 1997, the Manager agreed to waive all or a
portion of its fee in an amount that will limit annual operating expenses.
The accompanying notes are an integral part of the financial statements.
25
This page is intentionally left blank.
The accompanying notes are an integral part of the financial statements.
25
This page is intentionally left blank.
The accompanying notes are an integral part of the financial statements.
26
KIEWIT MUTUAL FUND/TAX EXEMPT PORTFOLIO
- ---------------------------------------------------
Investments/June 30, 1996
(Showing Percentage of Total Value of Net Assets)
- ------------------------------------------------------------------------------
Moody's/S&P Principal Value
Rating* Amount (Note 2)
----------- --------- -------
Municipal Bonds - 99.2%
Arizona - 2.2%
Maricopa County, AZ Unified School
Dist. #41 Gilbert (Proj. of 1988),
Ser. E, 6.50%, 07/01/08, Callable
07/01/02 @ 100 Aaa/AAA $ 1,000,000 $ 1,087,500
Phoenix, AZ Civic Imp. Corp. Airport
Term Excise Tax Rev., 7.80%, 07/01/11,
Partially Prerefunded 07/01/97 @ 102 Aa/AA+ 2,000,000 2,085,960
---------
3,173,460
---------
California - 3.3%
Laguna Beach, CA Gen. Oblig., 6.60%,
08/15/09, Callable 08/15/01 @ 102 Aa/AA 1,150,000 1,226,187
San Francisco, CA (City & County Public
Safety Imp. Proj.), Ser. 1990C, 6.10%,
06/15/06 A1/AA- 1,510,000 1,570,400
Southern California Public Power. Auth.
(Mead Adelanto Proj.), Ser. A, 4.75%,
07/01/08, Callable 07/01/04 @ 102 Aaa/AAA 2,000,000 1,857,500
---------
4,654,087
---------
Colorado - 1.5%
Denver, CO City & County Gen. Oblig.,
6.375%, 08/01/02, Callable 08/01/01
@ 101 Aa/AA 1,920,000 2,068,800
---------
Connecticut - 4.3%
Connecticut State Gen. Oblig., 4.75%,
03/15/07, Callable 03/15/04 @ 101.50 Aa/AA- 6,500,000 6,101,875
---------
Florida - 2.0%
Jacksonville, FL Electric Auth. Ref. Rev.
(St. Johns River Power Park Service),
7.00%, 10/01/09, Callable 10/01/99
@ 101.50 Aa1/AA 2,690,000 2,908,562
---------
Hawaii - 0.7%
Hawaii State Ref., Ser. BV, 6.00%,
11/01/04 Aaa/AAA 1,000,000 1,047,500
---------
Illinois - 6.3%
Chicago, IL Gen. Oblig. Unltd. School Fin.
Auth., Ser. A, 5.00%, 06/01/07,
Callable 06/01/04 @ 102 Aaa/AAA 3,000,000 2,891,250
Chicago, IL O'Hare International Airport,
Ser. 1988A, 8.00%, 01/01/08, Partially
Prerefunded 01/01/97 @ 102 NR/A+ 1,205,000 1,246,729
Illinois State Health Fac. Auth. (LA
Grange Memorial Hosp.), 5.50%,
05/15/23, Callable 05/15/03 @102 Aaa/AAA 2,445,000 2,564,194
Illinois State Toll Highway Priority Rev.
Ref., Ser. A, 3.50%, 01/01/05, Callable
01/01/03 @ 100 A1/A 2,500,000 2,200,000
---------
8,902,173
---------
Indiana - 2.8%
Indiana Bond Bank Special Prog., Ser. A,
6.25%, 08/01/09, Callable 02/01/98
@ 102 Aaa/AAA 2,450,000 2,495,937
Indianapolis, IN Local Public Imp. Bond
Bank, 5.30%, 01/10/00 Aa/AA 1,500,000 1,530,000
---------
4,025,937
---------
Iowa - 2.4%
Des Moines, IA Gen. Oblig. Unltd., Ser.
D, 5.00%, 06/01/03 Aa/AA+ 3,380,000 3,401,125
---------
Kansas - 1.2%
Wichita, KS Sales Tax Gen. Oblig. Unltd.,
4.50%, 06/01/99 Aa/AA 1,670,000 1,667,912
---------
The accompanying notes are an integral part of the financial statements.
27
KIEWIT MUTUAL FUND/TAX EXEMPT PORTFOLIO
- ---------------------------------------------------
Investments/June 30, 1996 - continued
- ------------------------------------------------------------------------------
Moody's/S&P Principal Value
Rating* Amount (Note 2)
----------- --------- -------
Maryland - 3.3%
Maryland National Park & Planning
Commission Prince Georges County, MD
Ref. (Park Aquisition & Dev.), Ser.
S-2, 5.00%, 07/01/01 Aa/AA $ 1,160,000 $ 1,178,850
Maryland State Gen. Oblig., 5.00%,
03/15/01 Aaa/AAA 1,000,000 1,013,750
Maryland Water Quality, Ser. A, 4.70%,
09/01/11, Prerefunded 09/01/00 @ 102 Aaa/AA 2,250,000 2,505,938
-----------
4,698,538
-----------
Massachusetts - 4.7%
Massachusetts State, 5.80%, 08/01/09,
Callable 08/01/04 @ 102 Aaa/AAA 1,000,000 1,020,000
Massachusetts State Health & Educ. Fac.,
(St. Joseph Hosp.), Ser. C, 9.50%,
10/01/20, Prerefunded 10/01/99 @ 102 NR/NR 4,900,000 5,659,500
-----------
6,679,500
-----------
Michigan - 7.2%
Detroit, Michigan City School Dist.
Qualified School Building Fund Insured
UTGO, 4.85%, 05/1/04 Aa/AA 1,500,000 1,445,625
Kent County, MI Bldg. Auth. Gen. Oblig.,
Ltd., 6.00%, 12/01/09, Callable
12/01/98 @ 102 Aa/AAA 1,250,000 1,278,125
Michigan Municipal Bond Auth. Rev.,
6.95%, 05/15/11, Callable 05/15/01
@ 102 Aa/AA 1,575,000 1,716,750
Michigan State Bldg. Auth. Rev., Ref.
Bond Ser. 1, 6.20%, 10/01/02 A1/AA- 5,450,000 5,824,687
-----------
10,265,187
-----------
Minnesota - 10.0%
Metropolitan Council Minnesota
Minneapolis - St. Paul Metro Area Ref.
Sewer, Ser. B, 09/01/06, 4.90% Aaa/AAA 1,935,000 1,879,369
Minnesota State Gen. Oblig. Unltd.,
4.75%, 05/01/01 Aaa/AA+ 5,000,000 5,018,750
Ramsey County, MN Gen. Oblig. Unltd.,
4.75%, 02/01/05 Aaa/AA+ 1,000,000 1,061,250
Southern Minnesota Municipal Power
Agency, 5.00%, 01/01/10, Callable
01/01/04 @ 102 Aaa/AAA 2,000,000 1,845,000
St. Paul, MN Sewer Rev., Ser. 1988A,
8.00%, 12/01/08, Subject to Crossover
Refunding 12/01/98 @ 101 Aaa/AAA 1,250,000 1,357,813
Washington County, MN Housing & Redev.
Auth. Jail Fac. Rev., 7.00%, 02/01/12,
Prerefunded 02/01/02 @ 100 Aaa/AAA 2,785,000 3,073,944
-----------
14,236,126
-----------
Missouri - 1.8%
Missouri Higher Educ. Student Loan Auth.
Sr. Lien Rev., Ser. 1992A, 5.00%,
02/15/97 Aa/NR 1,430,000 1,433,275
St. Louis, MO Water Ref. Rev. & Imp.,
6.00%, 07/01/07, Callable 07/01/04
@ 102 Aaa/AAA 1,000,000 1,047,500
-----------
2,480,775
-----------
Nebraska - 10.9%
Douglas County, NE Zoo Fac. Rev.
(Henry Doorly Zoo Aquarium Proj.),
6.00%, 06/01/03, Callable 06/01/97
@ 100 NR/NR 2,500,000 2,509,925
Lancaster County, NE Hosp. Auth. No. 1
(Sisters of Charity), 6.375%, 05/15/05,
Callable 05/15/01 @ 102 Aaa/AAA 1,530,000 1,637,100
Nebraska Public Power Dist. Nuclear Fac.,
5.40%, 07/01/01 Aaa/AAA 3,370,000 3,454,250
Nebraska Public Power Dist. Rev. Power
Supply Sys., Ser. C, 4.40%, 01/01/03 A1/A+ 2,120,000 2,048,450
Omaha, NE Ref. Rev., 4.15%, 10/15/97 Aaa/AAA 2,550,000 2,559,563
Omaha, NE Gen. Oblig., 4.75%, 12/01/01 Aaa/AAA 1,070,000 1,074,013
The accompanying notes are an integral part of the financial statements.
28
KIEWIT MUTUAL FUND/TAX EXEMPT PORTFOLIO
- ---------------------------------------------------
Investments/June 30, 1996 - continued
- ------------------------------------------------------------------------------
Moody's/S&P Principal Value
Rating* Amount (Note 2)
----------- --------- -------
Omaha, NE Public Power Dist., Ser. B,
4.90%, 02/01/02 Aa/AA $ 1,175,000 $ 1,177,937
Omaha, NE Public Power Dist., 6.40%,
02/01/11, Prerefunded 02/01/02
@ 101.50 NR/AAA 1,000,000 1,083,750
-----------
15,544,988
-----------
Nevada - 3.5%
Clark County, NV School Dist. Gen.
Oblig., 5.60%, 06/15/08, Callable
06/15/05 @ 101 Aaa/AAA 5,000,000 5,025,000
-----------
New Jersey - 0.8%
New Jersey State Trans. Trust Fund Ref.
Bonds, Ser. B, 6.00%, 06/15/05 Aaa/AAA 1,000,000 1,056,250
-----------
New Mexico - 3.2%
Farmington, NM Power Rev, 9.875%,
01/01/13, Callable 07/01/05 @ 100 Aaa/AAA 1,550,000 2,024,687
New Mexico State Severance Tax, Ser.
1992C, 5.60%, 07/01/02, Callable
07/01/97 @ 101.50 Aa/AA 2,400,000 2,453,232
-----------
4,477,919
-----------
New York - 0.9%
New York, NY Corpus M-Strips, 6.00%,
08/01/11, Callable 08/01/97 @ 100 NR/NR 1,400,000 1,305,500
-----------
North Dakota - 0.8%
Lakota, ND (Cargill Proj.), Ser. 1996,
5.00%, 09/01/00 NR/AA3 1,190,000 1,190,000
-----------
Ohio - 0.6%
Ohio State Public Fac. (Community Higher
Educ. Cap. Fac.) Ser. II-A, 4.30%,
12/01/08 Aaa/AAA 1,000,000 870,000
-----------
Oregon - 1.3%
Oregon Health Sciences Univ. Rev.,
Ser. B, 4.125%, 07/01/99 Aaa/AAA 1,875,000 1,846,875
-----------
Pennsylvania - 1.1%
Pennsylvania Intergovernmental Coop.
Auth. Special Tax Rev. (City of
Philadelphia Funding Proj.), 6.00%,
06/15/00 Aaa/AAA 1,500,000 1,569,375
-----------
Rhode Island - 2.2%
Rhode Island State, 6.125%, 05/15/04,
Prerefunded 05/15/00 @ 102 A1/AA- 1,740,000 1,848,750
Rhode Island State Health & Educ. Bldg.
Corp. (Brown Univ.), 6.625%, 09/01/07,
Callable 09/01/99 @ 102 Aa1/AA 1,205,000 1,280,312
-----------
3,129,062
-----------
Texas - 7.5%
Houston, TX Housing Fin. Corp. Single
Family Mtge. Ref. Rev., Ser. 1993A,
4.70%, 06/01/98 Aaa/AAA 1,300,000 1,300,000
Houston, TX Gen. Oblig. Tax & Rev.
Cert., Ser. 1993F, 3.90%, 03/01/99 Aa/AA- 2,000,000 1,967,500
Houston, TX Independent School Dist.,
6.375%, 08/15/01 Aaa/AAA 3,925,000 4,209,563
Port Neches-Groves, TX Independent
School Dist., 6.00%, 02/15/07 Aaa/AAA 1,000,000 1,060,000
Texas Municipal Power Agency Rev.,
6.10%, 09/01/08 Aaa/AAA 2,000,000 2,115,000
-----------
10,652,063
-----------
The accompanying notes are an integral part of the financial statements.
29
KIEWIT MUTUAL FUND/TAX EXEMPT PORTFOLIO
- ---------------------------------------------------
Investments/June 30, 1996 - continued
- ------------------------------------------------------------------------------
Moody's/S&P Principal Value
Rating* Amount (Note 2)
----------- --------- -------
Utah - 3.2%
Provo City, UT Energy Sys. Rev., 5.50%,
11/15/11 Aaa/AAA $ 2,175,000 $ 2,120,625
Utah State Gen. Oblig. Unltd., 4.40%,
07/01/99 Aaa/AAA 2,500,000 2,496,875
------------
4,617,500
------------
Virginia - 3.7%
Fairfax, VA Water Auth., 6.125%,
01/01/29, Callable 01/01/00 @ 100 Aaa/AAA 5,000,000 5,237,500
------------
Washington - 4.9%
Port Seattle, WA Airport and Marina
Rev., Ser. B, 5.90%, 11/01/99 Aa-/A1 1,000,000 1,030,000
Seattle, WA Metropolitan Sewer Rev.,
Ser. T, 6.625%, 01/01/06, Callable
01/01/00 @ 102 A1/AA- 1,240,000 1,323,700
Washington State, Ser. B, 6.375%,
08/01/10, Prerefunded 08/01/00 @ 100 Aa/AA 4,350,000 4,600,125
------------
6,953,825
------------
Wisconsin - 0.9%
Wisconsin Gen. Oblig., Ser. 1, 4.60%,
05/01/99 Aa/AA 1,300,000 1,300,000
------------
TOTAL MUNICIPAL BONDS (COST $141,080,207) 141,087,414
-----------
Tax-Exempt Mutual Funds - 2.5%
Federated Tax Free Oblig. Fund
Institutional Shares
(COST $3,538,670) NR/NR 3,538,670 3,538,670
-----------
TOTAL INVESTMENTS (COST $144,618,877)
+ - 101.7% 144,626,084
OTHER ASSETS AND LIABILITIES, NET -
(1.7)% (2,441,015)
-----------
NET ASSETS - 100.0% $142,185,069
============
*Unaudited.
+Cost for federal income tax and financial reporting purposes.
At June 30, 1996, net unrealized appreciation was $7,207.
This consisted of aggregate gross unrealized appreciation
for all securities in which there was an excess of market
value over cost of $776,527 and aggregate gross unrealized
depreciation for all securities in which there was an excess
of cost over market value of $769,320.
NR Not Rated.
The accompanying notes are an integral part of the financial statements.
30
KIEWIT MUTUAL FUND/TAX EXEMPT PORTFOLIO
- ---------------------------------------------------
FINANCIAL STATEMENTS
- ------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
June 30, 1996
Assets:
Investments in securities, at value (amortized
cost $144,618,877) (Note 2) $144,626,084
Cash 314
Interest receivable 2,325,230
Unamortized organization costs (Note 2) 21,448
Other assets 960
------------
Total assets 146,974,036
Liabilities:
Dividends payable $ 253,342
Payable for investment securities purchased 4,465,240
Accrued management fees (Note 4) 37,642
Other accrued expenses (Note 4) 32,743
------------
Total liabilities 4,788,967
------------
Net Assets $142,185,069
============
Net Assets consist of:
Shares of beneficial interest $ 703,814
Additional paid-in capital 141,321,155
Accumulated net realized gain on investments 152,893
Net unrealized appreciation of investments 7,207
------------
Net Assets, for 70,381,380 shares outstanding $142,185,069
============
Net Asset Value, offering and redemption price
per share ($142,185,069 ( 70,381,380 outstanding
shares of beneficial interest, $0.01
par value, unlimited number of shares
authorized) $2.02
=====
The accompanying notes are an integral part of the financial statements.
31
KIEWIT MUTUAL FUND/TAX-EXEMPT PORTFOLIO
- ---------------------------------------------------
FINANCIAL STATEMENTS - continued
- ------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
For the Fiscal Ended
Interest income $ 6,990,938
Expenses:
Management fee (reflects $57,267 waiver) (Note 4) $505,847
Administration fee (Note 4) 50,000
Accounting fee (Note 4) 52,519
Transfer Agent fee (Note 4) 20,675
Custodian fee (Note 4) 16,042
Trustees' fees and expenses (Note 4) 5,000
Amortization of organizational expenses (Note 2) 6,833
Registration Fees 11,464
Legal 5,083
Audit 14,781
Other 15,669
----------
Total expenses, net 703,913
----------
Net investment income 6,287,025
----------
Realized and unrealized gain (loss) on investments:
Net realized gain on investment transactions 1,129,202
Net change in unrealized depreciation of investments (1,088,183)
----------
Net gain on investments 41,019
----------
Net increase in net assets resulting from operations $6,328,044
==========
The accompanying notes are an integral part of the financial statements.
32
KIEWIT MUTUAL FUND/TAX-EXEMPT PORTFOLIO
- ---------------------------------------------------
FINANCIAL STATEMENTS - continued
- ------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
For the Period
July 25, 1994
For the Fiscal Year (Commencement of
Ended Operations) through
June 30, 1996 June 30, 1995
Increase (Decrease) in Net Assets:
Operations:
Net investment income $ 6,287,025 $ 7,775,015
Net change in unrealized appreciation
(depreciation) of investments (1,088,183) 1,095,390
------------ ------------
Net increase in net assets resulting
from operations 6,328,044 7,894,096
------------ ------------
Distributions to shareholders from net
investment income ($0.091 and $0.082
per share, respectively) (6,287,025) (7,775,015)
------------ ------------
Fund Share Transactions (a):
Receipt from shares sold 834,895 256,020,185
Receipt from shares issued on
reinvestment of distributions 6,294,106 7,172,761
Shares redeemed (502,681) (127,794,297)
----------- ------------
Net increase in net assets from Fund
share transactions 6,626,320 135,398,649
----------- ------------
Total increase in net assets 6,667,339 135,517,730
Net Assets:
Beginning of period 135,517,730 0
----------- ------------
End of period $142,185,069 $135,517,730
============ ============
(a) Transactions in capital stock were:
Shares sold 406,518 128,010,155
Shares issued on reinvestment of
distributions 3,075,446 3,614,686
Shares redeemed (248,827) (64,476,598)
----------- ------------
Net increase in shares 3,233,137 67,148,243
Shares outstanding - Beginning
balance 67,148,243 0
----------- ------------
Shares outstanding - Ending balance 70,381,380 67,148,243
=========== ============
The accompanying notes are an integral part of the financial statements.
33
KIEWIT MUTUAL FUND/TAX-EXEMPT PORTFOLIO
- ---------------------------------------------------
FINANCIAL HIGHLIGHTS
- ------------------------------------------------------------------------------
The following table includes selected data for a share
outstanding throughout each period.
For the Period
July 25, 1994
For the Fiscal Year (Commencement of
Ended Operations) through
June 30, 1996 June 30, 1995
Net Asset Value - Beginning of Period $2.02 $2.00
----- -----
Investment Operations:
Net investment income 0.09 0.08
Net realized and unrealized gain on
investments 0.00 0.02
----- -----
Total from investment operations 0.09 0.10
----- -----
Distributions:
From net investment income (0.09) (0.08)
----- -----
Net Asset Value - End of Period $2.02 $2.02
===== =====
Total Return 4.55% 5.23%**
Ratios (to average net assets)
/Supplemental Data:
Expenses + .50% .39%*
Net investment income 4.47% 4.37%*
Portfolio turnover rate 100.61% 104.34%*
Net assets at end of period $142,185,069 $135,517,730
________
*Annualized
**The total return for the period ended June 30, 1995 has not been annualized.
+Since inception, Kiewit Investment Management Corp. (the
"Manager") agreed to waive all or a portion of its fee.
For the period from December 7, 1994 through June 30, 1996,
the Manager further agreed to waive all or a portion of
its fee in an amount that will limit annual operating expenses
to not more than 0.40% of the average daily net assets of the
Portfolio. Effective July 1, 1995 through June 30, 1997, the
Manager has agreed to waive all or a portion of its fee in an
amount that will limit annual operating expenses to not more
than 0.50% of the average daily net assets of the Portfolio.
The annualized expense ratio, had there been no fee waivers
by the Manager, would have been 0.54% and 0.46% for the fiscal
year ended June 30, 1996 and for the period ended June 30, 1995,
respectively.
The accompanying notes are an integral part of the financial statements.
34
KIEWIT MUTUAL FUND/EQUITY PORTFOLIO
- ---------------------------------------------------
Investments/June 30, 1996
(Showing Percentage of Total Value of Net Assets)
- ------------------------------------------------------------------------------
Value
Shares (Note 2)
------ --------
Common Stock - 92.7%
State and National Banks - 1.2%
Crestar Financial Corp. $ 15,000 $ 800,625
----------
Manufacturing - 63.6%
Chemicals & Allied Products - 4.9%
Monsanto Co. 55,000 1,787,500
Morton International, Inc. 39,100 1,456,475
----------
3,243,975
----------
Computer & Office Equipment - 3.0%
Cisco Systems, Inc.* 14,000 792,750
3Com Corp.* 26,000 1,189,500
----------
1,982,250
----------
Consumer Products - 12.1%
Avon Products, Inc. 42,000 1,895,250
Newell Co. 50,000 1,531,250
Procter & Gamble Co. 20,000 1,812,500
Whirlpool Corp. 55,000 2,729,375
----------
7,968,375
----------
Electronics - 1.8%
Kemet Corp.* 60,000 1,200,000
----------
Food & Beverage - 2.3%
Northland Cranberries Class A 50,000 1,500,000
----------
Iron & Steel - 3.0%
LTV Corp. 175,000 1,990,625
----------
Misc. Electrical Machinery, Equipment
& Supplies - 7.1%
Black & Decker Corp. 42,000 1,622,250
National Semiconductor Corp.* 90,000 1,395,000
Thomas & Betts Corp. 44,000 1,650,000
----------
4,667,250
----------
Misc. Manufacturing Industries - 7.6%
Calgon Carbon Corp. 115,000 1,552,500
Flow International Corp.* 72,500 580,000
Litton Industries, Inc.* 36,500 1,587,750
Tracor, Inc.* 75,000 1,293,750
----------
5,014,000
----------
Oil Field Machinery & Equipment - 3.0%
Schlumberger, Ltd. 23,500 1,979,875
----------
Petroleum Refining - 2.6%
Mobil Corp. 15,500 1,737,938
----------
Pharmaceutical Preparations - 4.1%
Pfizer, Inc. 38,000 2,712,250
----------
Value
Shares (Note 2)
------ --------
Precision Instruments & Medical Supplies - 5.5%
Medtronic Inc. 30,000 $1,680,000
Millipore Corp. 47,000 1,968,124
----------
3,648,124
----------
Textiles & Apparel - 2.6%
Warnaco Group, Inc. 67,500 1,738,125
----------
Transportation Equipment - 4.0%
Chrysler Corp. 26,000 1,612,000
OEA, Inc. 13,000 487,500
Superior Industries International, Inc. 20,700 548,550
----------
2,648,050
----------
TOTAL MANUFACTURING 42,030,837
----------
Services - 14.3%
Amusement - 1.3%
Walt Disney Co. 13,641 857,678
----------
Business Services - 3.2%
Omnicom Group, Inc. 45,000 2,092,500
----------
Computer Services - 3.6%
Cerner Corp.* 80,000 1,710,000
Phamis Inc.* 45,000 663,750
----------
2,373,750
----------
Medical & Health Services - 6.2%
Tenet Healthcare Corp.* 75,000 1,603,125
United Healthcare Corp. 50,000 2,525,000
----------
4,128,125
----------
TOTAL SERVICES 9,452,053
----------
Wholesale & Retail Trade - 13.6%
Miscellaneous Retail Stores - 2.2%
Dayton Hudson Corp. 14,000 1,443,750
----------
Retail Building Materials - 4.5%
Home Depot, Inc. 55,000 2,970,000
----------
Retail Eating & Drinking Places - 2.9%
Cracker Barrel Old Country Store, Inc. 78,500 1,903,625
----------
Retail Food Stores - 2.9%
Albertson's, Inc. 47,000 1,944,625
----------
Wholesale Building Materials - 1.1%
Ply-Gem Industries, Inc. 55,000 749,375
----------
TOTAL WHOLESALE & RETAIL TRADE 9,011,375
----------
TOTAL COMMON STOCK (COST $52,600,471) 61,294,890
----------
The accompanying notes are an integral part of the financial statements.
35
KIEWIT MUTUAL FUND/EQUITY PORTFOLIO
- -----------------------------------------
Investments/June 30, 1996 - continued
- ------------------------------------------------------------------------------
Value
(Note 2)
--------
Repurchase Agreement - 7.9%
With Paine Webber Group, Inc.: at 5.55%, dated 06/28/96,
to be repurchased at $5,228,417 on 07/01/96, collateralized
by Federal Home Loan Mortgage securities with various coupons
and maturities to 05/01/26 (market value $5,333,222)
(COST $5,226,000) $ 5,226,000
------------
TOTAL INVESTMENTS
(COST $57,826,471) + - 100.6.% 66,520,890
OTHER ASSETS AND LIABILITIES,
NET - (0.6)% (384,054)
------------
NET ASSETS - 100.0% $ 66,136,836
============
COVERED CALL OPTIONS WRITTEN AT JUNE 30, 1996
Shares
Subject Value
to Call (Note 2)
------- --------
Common Stock/Exp. Date/Ex.Price
- -------------------------------
Chrysler Corp., Oct. 1996, $70 10,000 $(18,750)
Litton Industries Inc., July 1996, $45 10,000 (11,875)
3Com Corp., July 1996, $45 10,000 (18,750)
United Healthcare Corp., July 1996, $50 10,000 (18,750)
United Healthcare Corp., Sept. 1996, $65 10,000 (1,875)
Whirlpool Corp., September 1996, $50 15,000 (34,688)
---------
TOTAL CALL OPTIONS
(PREMIUMS RECEIVED $248,642) $(104,688)
---------
+Cost for federal income tax and financial reporting purposes. At June 30,
1996, net unrealized appreciation was $8,694,419. This consisted of
aggregate gross unrealized appreciation for all securities in which there
was an excess of market value over cost of $10,893,631 and aggregate gross
unrealized depreciation for securities in which there was an excess of cost
over market value of $2,199,212.
*Non-income producing security.
The accompanying notes are an integral part of the financial statements.
36
KIEWIT MUTUAL FUND/EQUITY PORTFOLIO
- ---------------------------------------------------
FINANCIAL STATEMENTS
- ------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
June 30, 1996
Assets:
Investments in securities (including repurchase
agreement of $5,226,000), at value (amortized
cost $57,826,471) (Note 2) $66,520,890
Cash 489
Receivable for Fund shares sold 10,563
Dividends and interest receivable 63,549
Other assets 264
-----------
Total assets 66,595,755
Liabilities:
Covered call options written, at value
(premiums received $248,642) $ 104,688
Payable for investment securities purchased 291,860
Accrued management fee (Note 4) 19,581
Other accrued expenses (Note 4) 42,790
-----------
Total liabilities 458,919
-----------
Net Assets $66,136,836
===========
Net Assets consist of:
Shares of beneficial interest $ 39,897
Additional paid-in capital 56,765,126
Undistributed net investment income 351,518
Accumulated net realized gain 141,922
Net unrealized appreciation of investments
(Note 3) 8,838,373
-----------
Net Assets, for 3,989,667 shares outstanding $66,136,836
===========
Net Asset Value, offering and redemption price
per share($66,136,836 3,989,667 outstanding
shares of beneficial interest, $0.01 par
value, unlimited number of shares authorized) $16.58
======
The accompanying notes are an integral part of the financial statements.
37
KIEWIT MUTUAL FUND/EQUITY PORTFOLIO
- -----------------------------------------
FINANCIAL STATEMENTS - continued
- ------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
For the Fiscal Year Ended June 30, 1996
Income:
Dividends $ 578,508
Interest 506,964
-----------
Total income 1,085,472
Expenses:
Management fee (reflects $126,289 waiver)
(Note 4) $228,357
Administration fee (Note 4) 50,000
Accounting fee (Note 4) 44,520
Transfer Agent fee (Note 4) 20,580
Custodian fee (Note 4) 15,560
Trustees' fees and expenses (Note 4) 5,000
Legal 1,146
Audit 14,577
Registration fees 23,987
Other 1,589
--------
Total expenses, net. 405,316
-----------
Net investment income 680,156
-----------
Realized and unrealized gain (loss) on investments:
Net realized loss on investment transactions (396,620)
Net realized gain on call options written 571,222
Net change in unrealized appreciation of
investments and call options 7,557,053
-----------
Net gain on investments 7,731,655
-----------
Net increase in net assets resulting from
operations $ 8,411,811
===========
The accompanying notes are an integral part of the financial statements.
38
KIEWIT MUTUAL FUND/EQUITY PORTFOLIO
- -----------------------------------------
FINANCIAL STATEMENTS - continued
- ------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
For the Period
January 5, 1995
For the Fiscal Year (Commencement of
Ended Operations) through
June 30, 1996 June 30, 1995
Increase (Decrease) in Net Assets:
Operations:
Net investment income $ 680,156 $ 156,910
Net realized loss on investments (396,620) 0
Net realized gain (loss) on call
options written 571,222 (32,680)
Net change in unrealized appreciation
of investments and call options 7,557,053 1,281,320
----------- -----------
Net increase in net assets resulting
from operations 8,411,811 1,405,550
----------- -----------
Distributions to shareholders from:
Net investment income ($0.15 and
$0.00 per share, respectively) (485,548) 0
----------- -----------
Fund Share Transactions (a):
Receipt from shares sold 39,179,945 21,063,170
Receipt from shares issued on
reinvestment of distributions 480,960 0
Shares redeemed (2,315,274) (1,603,778)
---------- ----------
Net increase in net assets from Fund
share transactions 37,345,631 19,459,392
---------- ----------
Total increase in net assets 45,271,894 20,864,942
Net Assets:
Beginning of period 20,864,942 0
---------- ----------
End of period (including undistributed
net investment income of $351,518
and $156,910, respectively) $66,136,836 $20,864,942
========== ==========
(a) Transactions in capital stock were:
Shares sold 2,617,366 1,613,591
Shares issued on reinvestment of
distributions 31,130 0
Shares redeemed (145,226) (127,194)
---------- ----------
Net increase in shares 2,503,270 1,486,397
Shares outstanding - Beginning balance 1,486,397 0
---------- ----------
Shares outstanding - Ending balance 3,989,667 1,486,397
========== ==========
The accompanying notes are an integral part of the financial statements.
39
KIEWIT MUTUAL FUND/EQUITY PORTFOLIO
- -----------------------------------------
FINANCIAL HIGHLIGHTS
- ------------------------------------------------------------------------------
The following table includes selected data for a share outstanding throughout
each period.
For the Period
January 5, 1994
For the Fiscal Year (Commencement of
Ended Operations) through
June 30, 1996 June 30, 1995
Net Asset Value - Beginning of Period $14.04 $12.50
------ ------
Investment Operations:
Net investment income 0.13 0.11
Net realized and unrealized gain on
investments 2.56 1.43
------ ------
Total from investment operations 2.69 1.54
------ ------
Distributions:
From net investment income (0.15) 0.00
------ ------
Net Asset Value - End of Period $16.58 $14.04
====== ======
Total Return 19.24% 12.32%**
Ratios (to average net assets)/Supplemental
Data:
Expenses + 0.80% 0.80%*
Net investment income 1.34% 3.06%*
Portfolio turnover rate 16.95% 0.00%*
Average commission rate paid $0.0637 -
Net assets at end of period $66,136,836 $20,864,942
_________________________
*Annualized
** The total return for the period ended June 30, 1995 has not been annualized.
+For the period from inception through June 30, 1997, Kiewit
Investment Management Corp. has agreed to waive all or a
portion of its fee in an amount that will limit annual
operating expenses to not more than 0.80% of the average
daily net assets of the Portfolio. The annualized expense
ratio, had there been no fee waivers, would have been 1.05%
and 2.56% for the year ended June 30, 1996 and for the period
ended June 30, 1995, respectively.
The accompanying notes are an integral part of the financial statements.
40
KIEWIT MUTUAL FUND
- -----------------------------------------
NOTES TO FINANCIAL STATEMENTS
- ------------------------------------------------------------------------------
1. Description of the Fund. The Kiewit Mutual Fund (the
"Fund") is registered under the Investment Company Act of 1940
(the "1940 Act"), as an open-end management investment
company. The Fund was organized as a Delaware business trust
on June 1, 1994. The Declaration of Trust permits the
Trustees to establish additional series, each of which is a
separate class of shares. The Fund comprises five series
of shares: Kiewit Money Market Portfolio, Kiewit Short-Term
Government Portfolio, Kiewit Intermediate-Term Bond Portfolio,
Kiewit Tax-Exempt Portfolio and Kiewit Equity Portfolio (each,
a "Portfolio" and collectively, the "Portfolios"). Prior to
December 6, 1994, the Fund was known as the Kiewit
Institutional Fund. The investment objective of each
Portfolio is as follows: Money Market Portfolio: high current
income, while maintaining a stable share price by investing
in short-term money market securities; Short-Term Government
Portfolio: a high level of current income, consistent with the
maintenance of principal and liquidity; Intermediate-Term Bond
Portfolio: a high level of current income, consistent with
reasonable risk; Tax-Exempt Portfolio: a high level of current
income, exempt from federal income tax, consistent with
reasonable risk; and Equity Portfolio: long-term capital
appreciation.
2. Significant Accounting Policies. The following is a
summary of the significant accounting policies of the Fund:
Security Valuation. Securities held by the Portfolios
which are listed on a securities exchange and for which market
quotations are available are valued at the last quoted sale
price of the day or, if there is no such reported sale,
securities are valued at the mean between the most recent
quoted bid and asked prices. Price information for listed
securities is taken from the exchange where the security is
primarily traded. Unlisted securities for which market
quotations are readily available are valued at the most
recent bid prices. Securities in the Money Market Portfolio
are valued using the amortized cost valuation method which is
permitted under Rule 2a-7 under the 1940 Act. This method
involves valuing a portfolio security initially at its cost
and thereafter adjusting for amortization of premium or
accretion of discount to maturity. Each money market
instrument with a remaining maturity of 60 days or less is
valued at amortized cost, which approximates market value,
unless the Fund's Board of Trustees determines that this
does not represent fair value. The value of other assets and
securities for which no quotations are readily available
(including restricted securities) are determined in good
faith at fair value in accordance with procedures adopted
by the Board of Trustees.
Federal Income Taxes. Each Portfolio is treated as a separate
entity for federal income tax purposes, each Portfolio is
intended to qualify as a regulated investment company under
Subchapter M of the Internal Revenue Code and each Portfolio
is expected to distribute all of its taxable and tax-exempt
income to its shareholders. Therefore, no federal income tax
provision is required. At June 30, 1996, the Money Market
Portfolio, Short-Term Government Portfolio and Intermediate-
Term Bond Portfolio had a net tax basis capital loss carry
forward available to offset future net capital gains of
approximately $2,000, $102,000 and $463,000, respectively.
The capital loss carry forwards all expire in 2003 or 2004.
Interest Income and Distributions to Shareholders. Interest
income is accrued as earned. Distributions of net investment
income consist of accrued interest and earned discount
(including both original issue and market discount) less
amortization of premium and accrued expenses. Distributions
to shareholders of each Portfolio, except the Kiewit Equity
Portfolio, are declared daily from net investment income and
paid to shareholders monthly. The Fund's policy is to
distribute substantially all net income from the Kiewit Equity
Portfolio annually. Distributions of net capital gains
realized by each Portfolio will be made at least annually.
Deferred Organization Costs. Organization costs incurred by
each Portfolio have been deferred and are being amortized
using the straight-line method over a five-year period
beginning on the date that each Portfolio commenced operations.
In the event that any of the initial shares of a Portfolio
are redeemed during the amortization period by any holder
thereof, the redemption proceeds will be reduced by any
unamortized organization expenses in the same proportion
as the number of initial shares being redeemed bears to the
number of initial shares outstanding at the time of such
redemption.
41
KIEWIT MUTUAL FUND
- -----------------------------------------
NOTES TO FINANCIAL STATEMENTS - continued
- ------------------------------------------------------------------------------
2. Significant Accounting Policies - continued
Use of Estimates in the Preparation of Financial Statements.
The preparation of financial statements in conformity with
generally accepted accounting principles requires management
to make estimates and assumptions that affect the reported
amount of assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ
from those estimates.
Repurchase Agreements. Each Portfolio, through the Fund's
custodian, receives delivery of the underlying securities
used to collateralize the repurchase agreements, the market
value of which is required to be in an amount at least equal
to 102% of the resale price. Kiewit Investment Management
Corp., the Fund Manager, is responsible for determining that
the market value of these underlying securities is maintained
at a level at least equal to 102% of the resale price. In the
event of default of the obligation to repurchase, the Fund has
the right to liquidate the collateral and apply the proceeds in
satisfaction of the obligation. Provisions of each agreement
require that the market value of the collateral is sufficient
in the event of default; however, in the event of default or
bankruptcy by the other party to the agreement, realization
and/or retention of the collateral may be subject to legal
proceedings.
Call and Put Options. The Short-Term Government Portfolio,
Intermediate-Term Bond Portfolio and the Equity Portfolio
each may sell and/or purchase exchange-traded call options
and purchase exchange traded put options on securities in the
Portfolio. When a Portfolio writes a call option an amount
equal to the premium received is reflected as a liability.
The amount of the liability is subsequently "marked to market"
to reflect the current market value of the option written.
If an option which a Portfolio has written either expires on
its stipulated expiration date, or if a Portfolio enters into
a closing purchase transaction, the Portfolio realizes a gain
(or loss if the cost of the closing transaction exceeds the
premium received when the option is sold), and the liability
related to such option is extinguished. If a call option which
a Portfolio has written is exercised, the Portfolio realizes a
gain or loss from the sale of the underlying security and the
proceeds from such a sale are increased by the premium
originally received. A Portfolio as writer of an option may
have no control over whether the underlying securities may be
sold (call) and as a result bears a market risk of an
unfavorable change in the price of the security underlying
the written option.
The premium paid by a Portfolio for the purchase of a put
option is recorded as an investment and subsequently marked
to market to reflect the current market value of the option
purchased. If an option which a Portfolio has purchased
expires on the stipulated expiration date, the Portfolio
realizes a loss in the amount of the cost of the option.
If a Portfolio enters into a closing transaction, it realizes
a gain (loss) if the proceeds from the sale are greater (less)
than the cost of the option purchased. If a Portfolio
exercises a put option, it realizes a gain or loss from the
sale of the underlying security and the proceeds from such
sale are decreased by the premium originally paid.
Other. Investment security transactions are accounted for on
a trade date basis. Each Portfolio uses the specific
identification method for determining realized gain and
loss on investments for both financial and federal income
tax reporting purposes.
3. Investment Securities. During the fiscal year ended
June 30, 1996, purchases and sales of investment securities
(excluding short-term investments) aggregated as follows:
Short-Term Intermediate-
Government Term Bond Tax-Exempt Equity
---------- --------- ---------- ------
Purchases $97,332,652 $110,204,509 $139,234,936 $44,163,714
Sales 64,091,601 96,145,493 132,779,962 7,093,288
42
KIEWIT MUTUAL FUND-----------------------------------------
NOTES TO FINANCIAL STATEMENTS - continued
- ------------------------------------------------------------------------------
3. Investment Securities - continued
Written options transactions for the Equity Portfolio
during the fiscal year ended June 30, 1996 are summarized
as follows:
Call/Put Options Written
------------------------
Premiums Received
-----------------
Options Outstanding at June 30, 1995 $ ( 26,359)
Options written (1,239,526)
Options closed 313,419
Options exercised 242,987
Options expired 460,837
----------
Options outstanding at June 30, 1996 (248,642)
Unrealized appreciation at June 30, 1996 143,954
----------
Market value of written options at
June 30, 1996 $ (104,688)
==========
During the fiscal year ended June 30, 1996, the Short-Term
Government Portfolio and the Intermediate-Term Bond
Portfolio did not enter into any option contracts.
4. Management Fee and Other Transactions with Affiliates.
The Fund, on behalf of each Portfolio, employs Kiewit
Investment Management Corp. ("KIM"), an indirect, wholly-
owned subsidiary of Peter Kiewit Sons', Inc., a
construction, mining, and telecommunications company, to
furnish investment advisory and other services to the Fund.
Pursuant to an investment management agreement with the
Fund for each Portfolio, KIM manages the investment and
reinvestment of Fund assets, maintains required records and
makes regular reports to the Fund's officers and the Board
of Trustees.
For its investment management services, KIM receives fees
at the following annual rates of each Portfolio's average
monthly net assets: Money Market - 0.20%; Short-Term
Government - 0.30%; Intermediate-Term Bond - 0.40%; Tax-Exempt
0.40%; and Equity - 0.70%. Prior to December 7, 1994, KIM
received fees from the Portfolio's at an annual rate of
0.30% of each Portfolio's average daily net assets. In
addition, prior to December 7, 1994, KIM agreed to waive
one-half of its fee with respect to each Portfolio.
Effective December 7, 1994 through June 30, 1995, KIM
agreed to waive all or a portion of its management fee and
assume certain fund expenses in an amount that limited annual
operating expenses to not more than the following percentage
of the average daily net assets of each Portfolio: Money
Market - 0.30%; Short-Term Government - 0.40%; Intermediate-
Term Bond - 0.50%; Tax-Exempt - 0.50%; and Equity - 0.80%.
Effective July 1, 1995 through June 30, 1997, KIM has agreed
to waive all or a portion of its management fee and assume
certain fund expenses in an amount that will limit annual
operating expenses to not more than the following percentage
of the average daily net assets of each Portfolio: Money
Market - 0.20%; Short-Term Government - 0.30%; Intermediate-
Term Bond - 0.50%; Tax-Exempt - 0.50%; and Equity - 0.80%.
These undertakings may be amended or rescinded at any time
in the future.
43
KIEWIT MUTUAL FUND
- -----------------------------------------
NOTES TO FINANCIAL STATEMENTS - continued
- ------------------------------------------------------------------------------
4. Management Fee and Other Transactions with Affiliates -
continued
The following table summarizes the management fees for the
fiscal year ended June 30, 1996:
Gross Management Management
Fee Fees Waived
---------------- -----------
Money Market Portfolio $843,989 $298,011
Short-Term Government Portfolio 492,172 219,505
Intermediate-Term Bond Portfolio 499,823 86,597
Tax-Exempt Portfolio 563,114 57,267
Equity Portfolio 354,646 126,289
Rodney Square Management Corp. ("Rodney Square"), a wholly
owned subsidiary of Wilmington Trust Company ("WTC"), which
is wholly owned by Wilmington Trust Corporation, a publicly
held bank holding company, serves as Administrator to the
Fund pursuant to an Administration Agreement with the Fund
on behalf of each Portfolio. As Administrator, Rodney Square
is responsible for services such as financial reporting,
compliance monitoring and corporate management. For the
services provided, Rodney Square receives a monthly
administration fee from the Fund at an annual rate of $50,000
per Portfolio, plus an amount equal to 0.02% of that portion
of the Fund's net assets in excess of $1.5 billion, plus
out-of-pocket expenses. Treasury Strategies, Inc. ("TSI")
serves as Sub-Administrator of the Fund, pursuant to a Sub-
Administration agreement with KIM. As sub-administrator, TSI
is responsible for setting performance benchmarks for each of
the Fund's Portfolios, and measuring portfolio performance
against the appropriate benchmarks. TSI also evaluates on
behalf of KIM and the Fund the performance and pricing of the
Fund's external service providers. TSI is compensated by KIM
for the services it provides.
WTC serves as Custodian of the assets of the Fund.
Rodney Square serves as Transfer Agent and Dividend Paying
Agent of the Fund pursuant to a separate Transfer Agency
Agreement with the Fund on behalf of each Portfolio. For
its services, the Fund pays Rodney Square a monthly fee of
$5,000, plus out-of-pocket expenses.
Rodney Square determines the net asset value per share of
each Portfolio and provides accounting services to the Fund
pursuant to an Accounting Services Agreement with the Fund
on behalf of each Portfolio. For its services, Rodney Square
receives an annual fee of $40,000 per Portfolio, plus an
amount equal to 0.01% of that portion of the Fund's average
daily net assets in excess of $100 million.
Independent Trustees are each paid an annual fee of $5,000
from the Fund, plus $250 per Portfolio per meeting attended,
plus travel expenses in connection with meetings. Certain
officers and trustees of the Fund are also officers and/or
directors of KIM.
44
Report of Independent Accountants
To the Board of Trustees and
Shareholders of
Kiewit Mutual Fund
In our opinion, the accompanying statements of assets and
liabilities, including the schedules of 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 Money Market
Portfolio, Short-Term Government Portfolio, Intermediate-Term
Bond Portfolio, Tax-Exempt Portfolio and Equity Portfolio
(constituting Kiewit Mutual Fund, hereafter referred to as
the "Fund"), at June 30, 1996, the results of each of their
operations for the year then ended, and changes in each of
their net assets and the financial highlights for each of
the periods indicated, in conformity with generally accepted
accounting principles. These financial statements and
financial highlights (hereafter referred to as "financial
statements") are the responsibility of the Fund's management;
our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of
these financial statements in accordance with generally
accepted auditing standards which require that we plan and
perform the audits 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 June 30, 1996 by correspondence with the
custodian and brokers, provide a reasonable basis for the
opinion expressed above.
PRICE WATERHOUSE LLP
Philadelphia, PA
July 26, 1996
45
KIEWIT MUTUAL FUND
- -----------------------------------------
TAX INFORMATION (UNAUDITED)
- ------------------------------------------------------------------------------
Pursuant to Section 852 of the Internal Revenue Code of 1986,
the Tax-Exempt Portfolio designates $6,123,159 as tax-exempt
dividends.
In January 1997, shareholders of the Fund will receive Federal
income tax information on all distributions paid to their
accounts in the calendar year 1996, including any distributions
paid between June 30, 1996 and December 31, 1996.
46
This page is intentionally left blank.
47
This report is submitted for the general information of the
shareholders of the Fund. The report is not authorized for
distribution to prospective investors in the Fund unless
preceded or accompanied by an effective Prospectus of the Fund.
KW07 48 Aug. '96
Report of Independent Accountants
To the Board of Trustees and
Shareholders of
Kiewit Mutual Fund
In our opinion, the accompanying statements of assets
and liabilities, including the schedules of 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 Money
Market Portfolio, Short-Term Government Portfolio,
Intermediate-Term Bond Portfolio, Tax-Exempt Portfolio
and Equity Portfolio (constituting Kiewit Mutual Fund,
hereafter referred to as the "Fund"), at June 30, 1996,
the results of each of their operations for the year then
ended, and changes in each of their net assets and the
financial highlights for each of the periods indicated,
in conformity with generally accepted accounting
principles. These financial statements and financial
highlights (hereafter referred to as "financial
statements") are the responsibility of the Fund's
management; our responsibility is to express an opinion
on these financial statements based on our audits.
We conducted our audits of these financial statements
in accordance with generally accepted auditing
standards which require that we plan and perform the
audits 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 June
30, 1996 by correspondence with the custodian and brokers,
provide a reasonable basis for the opinion expressed above.
PRICE WATERHOUSE LLP
Philadelphia, PA
July 26, 1996
