UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number 811-09134
Manor Investment Funds, Inc.
(Exact name of registrant as specified in charter)
15 Chester Commons, Malvern, PA 19355
(Address of principal executive offices)
Daniel A. Morris
15 Chester Commons, Malvern, PA 19355
(Name and address of agent for service)
Registrant s telephone number, including area code: 610-722-0900
Date of fiscal year end: December 31
Date of reporting period: December 31, 2010
Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270-30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget ( OMB ) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection if information under the clearance requirement of 44 U.S.C. 3507.
Item 1. Reports to Stockholders.
![[annual002.gif]](annual002.gif)
Annual Report
December 31, 2010
Fund Office:
15 Chester Commons
Malvern, PA 19355
610-722-0900 800-787-3334
www.manorfunds.com
Managed by:
Morris Capital Advisors, Inc.
MANOR INVESTMENT FUNDS, INC.
SHAREHOLDER LETTER
DECEMBER 31, 2010
Dear Fellow Shareholders:
Our funds continue to prosper by consistently applying the conservative investment approach that has been successful over so many years.
The Alfred E. Neuman Market
The likeness of Alfred E. Neuman has graced the cover of all but a handful of Mad magazine’s 500 issues. He is a gap-toothed character with big ears and a mischievous look on his face. One of his earliest appearances was on issue 30 in December 1956 when he was depicted as a write-in candidate for President using the slogan “You could do worse . . . and probably have”. But Neuman is most often pictured with the caption “What, me worry?”, and it is this motto that seems to best suit the mindset of our current market.
The stock market has enjoyed a one-way ride upward since July. It might be too far in the past to remember, but it was not even a year ago that the market was struggling through a dismal 2nd quarter, pressured by an uncertain economic rebound here at home and the fear of a financial unraveling of the European economic union. It was in this environment that Ben Bernanke first raised the possibility of a second round of “quantitative easing”. Quantitative easing, you may recall, is the controversial maneuver where the Federal Reserve artificially creates money to buy recently issued US Treasury securities through the primary dealers like Goldman Sachs. This process was first employed by the Fed in 2008 to forestall the potential collapse of our financial institutions at the peak of the economic crisis.
It seemed to work then, but less than two years later, the Fed chairman was proposing a second round of “quantitative easing” in the amount of $600 billion over the six months. This time the objective, as clearly stated by Mr. Bernanke, was to boost asset (stock) prices.
The stock market complied, rising more than 22% from the lows in July 2010 through year-end. It’s not surprising, since the Fed has, in essence, been pushing $4.5 billion a day into the financial markets. That liquidity, combined with the added leverage generated by the financial institutions that are the conduits for this policy, generates significant purchasing power without regard to underlying economic fundamentals.
MANOR INVESTMENT FUNDS, INC.
SHAREHOLDER LETTER (CONTINUED)
DECEMBER 31, 2010
While the stock market has reacted in the manner that the chairman desired, there have been several troubling secondary effects. Since the bottom in July, the price of gold rose 22%, the price of oil 25%, and the dollar declined 11%. In addition, since the new round of quantitative easing was officially announced, the yield of the 2-year US Treasury note rose from 0.34% to 0.60% while the yield of the 10-year US Treasury note has increased from 2.49% to 3.29%. This steepening of the yield curve, often an indication of stronger economic growth, could be an indicator of heightened inflationary concerns.
While chairman Bernanke is on record stating that the Fed has the tools to recognize the signs of a looming bubble in asset prices, and has the ability to reverse the massive liquidity injection that they have engineered, I have my doubts. The troubling statistics above could be the warning signs that excess liquidity is further distorting the financial markets. If these warning signs go unheeded it seems as if both the stock market and the Fed chairman fully embrace that “What, me worry?” approach.
The Manor Fund
The Manor Fund rose 13.29%, net of all fees and expenses, during the year ending December 31, 2010, underperforming the S&P 500 Index (15.06%) but outperforming comparable mutual funds as measured by the Lipper Large-Cap Core mutual fund index (12.79%). The Fund outperformed both the S&P 500 index and the Lipper Large-Cap Core mutual fund index during the trailing 3-year and 5-year periods with annualized returns of –0.49% and 2.34% for the Fund, compared to –2.87% and 2.29% for the S&P 500 index, and –3.11% and 1.92% for the Lipper index.
During the year ended December 31, 2010, the Fund was helped by strong performance from Endo Pharmaceuticals, Eaton Corporation, Watson Pharmaceuticals, Goodrich Corporation, and Nike, Inc. Shares of Endo Pharmaceuticals rose steadily from the end of May after the company announced an agreement to settle outstanding litigation regarding the licensing of a generic version of OPANA. The company followed up with several strong earnings reports throughout the balance of the year, and also announced an accretive acquisition in September. Eaton Corporation outperformed as the company reported several quarters of revenue and earnings above expectations. The company also announced several new contracts, and strategic acquisitions to bolster revenue and earnings growth.
MANOR INVESTMENT FUNDS, INC.
SHAREHOLDER LETTER (CONTINUED)
DECEMBER 31, 2010
Watson Pharmaceuticals also performed strongly throughout the year, announcing several product approvals and licensing agreements, and reporting revenue and earnings better than expectations each quarter. Goodrich Corporation rose steadily throughout the year, even when the market declined, despite reporting some quarters where earnings missed expectations. The shares were driven by the expectations of improving demand for its aeronautical products as commercial air travel improved. Nike, Inc. also had a strong year as consumer demand rebounded from depressed levels.
Notable laggards during the year ended December 31, 2010 include Diamond Offshore Drilling, Hewlett-Packard, Best Buy, Cisco Systems, and Exelon Corporation. Diamond Offshore Drilling declined sharply over the early part of the year after reporting two successive quarters of earnings disappointments. Results improved as the year progressed but the stock did not participate fully in the second half market rally. Shares of Hewlett-Packard declined sharply at mid year as the controversy surrounding the firing of CEO Mark Hurd raised concerns about the strategic direction of the company. These concerns also limited the participation of the stock in the late-year rally. Best Buy ended the year as one of the weaker performers, despite participating in the late-year rally, when the stock dropped sharply after announcing a very weak quarterly earnings report in December. The company missed earnings and revenue expectations by a wide margin, and also reduced revenue expectations for the next fiscal year. Cisco Systems was also doing better during the second half of the year, but the shares gapped lower after the company’s earnings report in November. Cisco actually reported revenue and earnings better than expected, but in the subsequent conference call the CEO, John Chambers, expressed concern about slowing revenue growth. Those concerns were enough to drive down the shares of the company at the open on the following day, and the shares remained depressed through the end of the year. Exelon Corporation declined early in the year on concerns about slowing economic growth and rising operating costs. The shares of this electric utility did not participate in the late-year rally despite reporting a series of stronger earnings reports.
MANOR INVESTMENT FUNDS, INC.
SHAREHOLDER LETTER (CONTINUED)
DECEMBER 31, 2010
The Growth Fund
The Growth Fund rose 19.18%, net of all fees and expenses, during the year ended December 31, 2010, outperforming both the S&P 500 index (15.06%), and comparable mutual funds as measured by the Lipper Large-Cap Growth mutual fund index (15.13%). The Fund continues to outperform both the S&P 500 index and comparable mutual funds as measured by the Lipper Large-Cap Growth mutual fund index for the trailing 3-years, and since inception, with annualized returns of -0.80% and 1.76% for the Fund, compared to annualized returns of -2.87% and 1.05% for the S&P 500 index, and compared to annualized returns of -2.22% and -1.66% for the Lipper index.
During the year ended December 31, 2010 the Fund was helped by strong performance from Cummins, Inc., Apple, Inc., Alpha Natural Resources, Dollar Tree, and Akamai Technology. Cummins rose steadily throughout the year as the company announced a string of earnings reports that exceeded expectations. The company benefitted from a rebound in demand and product improvements that stimulated replacement of older trucks. Apple also reported a string of earnings reports that exceeded expectations. Results were driven by the introduction of the new iPad, product upgrades in the iPhone and iPod, and continued growth in their Mac computer lineup. Alpha Natural Resources, a producer of metallurgical coal, rose as demand increased due to an improving economy and rising demand from China. Shares of Dollar Tree, a discount retailer, rose as consumers became more value conscious as the economy began a somewhat uncertain rebound. The company also announced a 3 for 2 stock split during the year. Akamai Technology, a maker of products that facilitate video transmission over the internet, rose as the popularity of video streaming increased.
Weak holdings in the portfolio during the year ended December 31, 2010 included Southwestern Energy, MasterCard, DeVry, Gilead Sciences, and Staples. Shares of Southwestern Energy fell during the early part of the year, despite reporting earnings and revenues that were generally around expectations. The company suffered from a weak pricing environment for its primary product, natural gas. The weak pricing, will make it more difficult for the company to generate strong earnings growth, despite an increase in production. The shares of MasterCard were volatile throughout the year, despite reporting several quarterly results better than expectations, due to uncertainty about proposed legislation designed to cut the fees charged by the card processor. Shares of the company dropped sharply in December when the proposed regulations reduced the interchange fees more than expected.
Shares of DeVry fell mid-year as the Federal Government discussed increased limitations on the student loan program used by many of the students at DeVry’s educational institutions. The shares recovered somewhat by year-end, but not enough to compensate for the earlier decline. Gilead Sciences declined early in the year after the company reported quarterly revenue and earnings above expectations, but reduced revenue guidance due to the difficulties that they encountered in the approval process for HIV drugs under development. The reduced guidance hurt the shares as investors had anticipated further growth in this product area. Shares of Staples were also weak as the company struggled to generate consistent earnings growth. The company faced a highly competitive market and reduced margins.
The Bond Fund
The Bond Fund generated a return of 0.85%, net of all fees and expenses, during the year ended December 31, 2010, underperforming both the Barclays Intermediate Government index return (4.13%) and the Lipper US Government mutual fund index (6.54%). The investment performance reflects the relatively conservative position of the Fund’s investment portfolio of US Treasury securities as compared to either index. The portfolio has an average yield to maturity of 0.65%, an average maturity of approximately 1.55 years, and an average duration of 1.51 years. The duration of a bond portfolio is a measure of risk, with a lower duration indicating a lower level of risk. The Fund is managed to provide a low-risk alternative for conservative investors.
Managing Despite the Worry
The performance of the stock market over the last six months has only served to underscore one of the basic tenants of our investment approach; that predicting short-term movements in the stock market is difficult, at best. The move that we just witnessed ranked in the top 5% of investment returns for the S&P 500 index for six month periods since 1950, and far outpaced improvements in the economy or corporate revenue and earnings. While investors certainly welcomed the rally, few would have predicted it as the market deteriorated in May and June of last year.
MANOR INVESTMENT FUNDS, INC.
SHAREHOLDER LETTER (CONTINUED)
DECEMBER 31, 2010
As a result, we believe that it is important to stay invested in good quality companies and look past the short-term volatility of the market. Our experience has demonstrated that this focus on underlying fundamentals and valuation enables us to assemble a portfolio of stocks that can participate in a market rally like the one we just experienced, while still providing a sound foundation based on the revenue and earnings growth potential of individual positions. Those fundamental valuations provide support throughout the portfolio when the market abandons that “What, me worry?” mentality.
Sincerely,
Daniel A. Morris
MANOR INVESTMENT FUNDS, INC.
MANOR FUND
PORTFOLIO ILLUSTRATION
DECEMBER 31, 2010 (UNAUDITED)
The following chart gives a visual breakdown of the Fund by the industry sectors the underlying securities represent as a percentage of the portfolio of investments.
![[annual004.gif]](annual004.gif)
MANOR INVESTMENT FUNDS, INC.
GROWTH FUND
PORTFOLIO ILLUSTRATION
DECEMBER 31, 2010 (UNAUDITED)
The following chart gives a visual breakdown of the Fund by the industry sectors the underlying securities represent as a percentage of the portfolio of investments.
![[annual006.gif]](annual006.gif)
MANOR INVESTMENT FUNDS, INC.
BOND FUND
PORTFOLIO ILLUSTRATION
DECEMBER 31, 2010 (UNAUDITED)
The following chart gives a visual breakdown of the Fund by the industry sectors the underlying securities represent as a percentage of the portfolio of investments.
![[annual008.gif]](annual008.gif)
MANOR INVESTMENT FUNDS, INC.
MANOR FUND
PERFORMANCE ILLUSTRATION
DECEMBER 31, 2010 (UNAUDITED)
Manor Fund
Comparison of the Change in Value of a $10,000 Investment in the Manor Fund, the Lipper Large Cap Core Index, and the S&P 500 Index.
![[annual010.gif]](annual010.gif)
1 Year
5 Year
Since Inception
Manor Fund *
13.29%
2.34%
4.73%
Lipper Large Cap Core Index **
12.79%
1.92%
4.80%
S&P 500 ***
15.06%
2.29%
7.05%
(a) The total returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
* Initial public offering of shares was September 26, 1995.
** The Indices are unmanaged benchmarks that assume reinvestment of all distributions and exclude the effect of taxes and fees. They are widely recognized unmanaged indices representative of broader markets and ranges of securities than are found in the Fund’s portfolio. Individuals cannot invest directly in an index.
***The Standard & Poor’s 500 Index (“S&P 500”) is a market value-weighted index, representing the aggregate market value of the common equity of 500 stocks primarily traded on the New York Stock Exchange. The S&P 500 is a widely recognized, unmanaged index of common stock prices. The figures for the S&P 500 reflect all dividends reinvested but do not reflect any deductions for fees, expenses or taxes.
This chart assumes an initial investment of $10,000 made on September 26, 1995. Past performance doesn't guarantee future results. Investment return and principal value will fluctuate so that shares, when redeemed, maybe worth more or less then their original cost. All returns reflect reinvested dividends but do not reflect the impact of taxes. Current performance may be higher or lower than the performance quoted. Performance information current to the most recent month-end may be obtained by calling 1-800-787-3334.
MANOR INVESTMENT FUNDS, INC.
GROWTH FUND
PERFORMANCE ILLUSTRATION
DECEMBER 31, 2010 (UNAUDITED)
Manor Growth Fund
Comparison of the Change in Value of a $10,000 Investment in the Manor Growth Fund, the Lipper Large Cap Growth Index, and the S&P 500 Index.
![[annual012.gif]](annual012.gif)
1 Year
5 Year
Since Inception
Manor Growth Fund *
19.18%
1.63%
1.76%
Lipper Large Cap Growth Index **
15.13%
2.39%
(1.66)%
S&P 500 ***
15.06%
2.29%
1.05%
(a) The total returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
* Initial public offering of shares was June 30, 1999.
** The Indices are unmanaged benchmarks that assume reinvestment of all distributions and exclude the effect of taxes and fees. They are widely recognized unmanaged indices representative of broader markets and ranges of securities than are found in the Fund’s portfolio. Individuals cannot invest directly in an index.
***The Standard & Poor’s 500 Index (“S&P 500”) is a market value-weighted index, representing the aggregate market value of the common equity of 500 stocks primarily traded on the New York Stock Exchange. The S&P 500 is a widely recognized, unmanaged index of common stock prices. The figures for the S&P 500 reflect all dividends reinvested but do not reflect any deductions for fees, expenses or taxes.
This chart assumes an initial investment of $10,000 made on June 30, 1999. Past performance doesn't guarantee future results. Investment return and principal value will fluctuate so that shares, when redeemed, maybe worth more or less then their original cost. All returns reflect reinvested dividends but do not reflect the impact of taxes. Current performance may be higher or lower than the performance quoted. Performance information current to the most recent month-end may be obtained by calling 1-800-787-3334.
MANOR INVESTMENT FUNDS, INC.
BOND FUND
PERFORMANCE ILLUSTRATION
DECEMBER 31, 2010 (UNAUDITED)
Manor Bond Fund
Comparison of the Change in Value of a $10,000 Investment in the Manor Bond Fund, the Lipper US Government Index, and the Barclays Intermediate Treasury Index.
![[annual014.gif]](annual014.gif)
1 Year
5 Year
Since Inception
Manor Bond Fund *
0.85%
2.76%
3.11%
Lipper US Government Index **
6.54%
5.08%
5.33%
Barclays Intermediate Treasury Index ***
4.13%
5.00%
5.19%
(a) The total returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
* Initial public offering of shares was June 30, 1999.
** The Indices are unmanaged benchmarks that assume reinvestment of all distributions and exclude the effect of taxes and fees. They are widely recognized unmanaged indices representative of broader markets and ranges of securities than are found in the Fund’s portfolio. Individuals cannot invest directly in an index.
***The Barclays Intermediate Treasury Index includes all publicly issued, U.S. Treasury securities that have a remaining maturity of greater than or equal to 1 year and less than 10 years, are rated investment grade, and have $250 million or more of outstanding face value.
This chart assumes an initial investment of $10,000 made on June 30, 1999. Past performance doesn't guarantee future results. Investment return and principal value will fluctuate so that shares, when redeemed, maybe worth more or less then their original cost. All returns reflect reinvested dividends but do not reflect the impact of taxes. Current performance may be higher or lower than the performance quoted. Performance information current to the most recent month-end may be obtained by calling 1-800-787-3334.
MANOR INVESTMENT FUNDS, INC.
MANOR FUND
SCHEDULE OF INVESTMENTS
DECEMBER 31, 2010
Shares |
| Value |
|
|
|
COMMON STOCKS - 94.05% |
| |
|
|
|
Beverages - 3.68% |
| |
2,383 | Pepsico, Inc. | $ 155,682 |
|
|
|
Computer & Office Equipment - 6.20% |
| |
2,497 | Hewlett-Packard Co. | 105,124 |
1,072 | International Business Machine Corp. | 157,327 |
|
| 262,451 |
Computer Communications Equipment - 1.26% |
| |
2,633 | Cisco Systems, Inc. * | 53,266 |
|
|
|
Construction, Mining & Materials Handling Machinery & Equipment - 2.22% | ||
1,604 | Dover Corp. | 93,754 |
|
|
|
Crude Petroleum & Natural Gas - 3.58% |
| |
1,542 | Occidental Petroleum Corp. | 151,270 |
|
|
|
Drilling Oil & Gas Wells - 5.01% |
| |
1,100 | Diamond Offshore Drilling, Inc. | 73,557 |
2,620 | Nabors Industries Ltd. * | 61,465 |
3,378 | Weatherford International Ltd. * | 77,018 |
|
| 212,040 |
Electric & Other Services Combined - 1.69% |
| |
1,717 | Exelon Corp. | 71,496 |
|
|
|
Electronic Connectors - 4.57% |
| |
3,662 | Amphenol Corp. Class A | 193,280 |
|
|
|
Fire, Marine & Casualty Insurance - 4.66% |
| |
1,830 | Allstate Corp. | 58,340 |
2,327 | Chubb Corp. | 138,782 |
|
| 197,122 |
Gold and Silver Ores - 3.51% |
| |
2,419 | Newmont Mining Corp. | 148,599 |
* Non-income producing securities during the period.
The accompanying notes are an integral part of these financial statements.
MANOR INVESTMENT FUNDS, INC.
MANOR FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
DECEMBER 31, 2010
Shares |
| Value |
|
|
|
Guided Missiles & Space Vehicles & Parts - 3.96% |
| |
1,902 | Goodrich Corp. | 167,509 |
|
|
|
Hospital & Medical Service Plans - 1.89% |
| |
1,405 | Wellpoint, Inc. * | 79,888 |
|
|
|
Investment Advice - 2.46% |
| |
935 | Franklin Resources, Inc. | 103,981 |
|
|
|
Miscellaneous Industrial & Commercial Machinery & Equipment - 3.26% |
| |
1,357 | Eaton Corp. | 137,749 |
|
|
|
Oil & Gas Field Machinery & Equipment - 2.82% |
| |
1,774 | National Oilwell Varco, Inc. | 119,302 |
|
|
|
Perfumes, Cosmetics & Other Toilet Preparations - 3.80% |
| |
2,001 | Colgate Palmolive Co. | 160,820 |
|
|
|
Pharmaceutical Preparations - 10.58% |
| |
4,130 | Endo Pharmaceuticals Holdings, Inc. * | 147,482 |
1,435 | Johnson & Johnson | 88,755 |
4,091 | Watson Pharmaceuticals, Inc. * | 211,300 |
|
| 447,537 |
Railroads, Line-Haul Operating - 3.83% |
| |
2,580 | Norfolk Southern Corp. | 162,076 |
|
|
|
Retail-Radio, TV & Consumer Electronic Stores - 2.17% |
| |
2,679 | Best Buy, Inc. | 91,863 |
|
|
|
Retail-Variety Stores - 3.24% |
| |
2,543 | Wal-Mart Stores, Inc. | 137,144 |
|
|
|
Rubber & Plastics Footwear - 4.41% |
| |
2,186 | Nike, Inc. Class B | 186,728 |
* Non-income producing securities during the period.
The accompanying notes are an integral part of these financial statements.
MANOR INVESTMENT FUNDS, INC.
MANOR FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
DECEMBER 31, 2010
Shares |
| Value |
|
|
|
Semiconductors & Related Devices - 3.69% |
| |
6,365 | Applied Materials, Inc. | 89,428 |
3,173 | Intel Corp. | 66,728 |
|
| 156,156 |
Services-Miscellaneous Amusement & Recreation - 3.44% |
| |
3,882 | Walt Disney Co. | 145,614 |
|
|
|
Steel Works, Blast Furnace Rolling Mills - 1.42% |
| |
1,367 | Nucor Corp. | 59,902 |
|
|
|
Telephone Communications - 2.72% |
| |
3,923 | AT&T, Inc. | 115,258 |
|
|
|
Wholesale - Drugs, Proprietaries & Druggists' Sundries - 3.98% |
| |
4,929 | AmerisourceBergen Corp. | 168,178 |
|
|
|
TOTAL FOR COMMON STOCKS (Cost $3,045,671) - 94.05% | 3,978,665 | |
|
|
|
SHORT TERM INVESTMENTS - 5.67% |
| |
240,042 | First American Government Obligation Fund Class Y 0.00% ** (Cost $240,042) | 240,042 |
|
|
|
TOTAL INVESTMENTS (Cost $3,285,713) - 99.72% | 4,218,707 | |
|
|
|
ASSETS IN EXCESS OF OTHER LIABILITIES - 0.28% | 11,774 | |
|
|
|
NET ASSETS - 100.00% | $ 4,230,481 | |
** Variable rate security; the coupon rate shown represents the yield at December 31, 2010.
The accompanying notes are an integral part of these financial statements.
MANOR INVESTMENT FUNDS, INC.
MANOR FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
DECEMBER 31, 2010
Various inputs are used in determining the value of the Fund's investments. These inputs are summarized in the three broad levels listed below:
Level 1 -
Unadjusted quoted prices in active markets for identical assets or liabilities that the Fund has the ability to access.
Level 2 -
Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an active market, price for similar instruments, interest rates, prepayment speeds, yield curves, default rates and similar data.
Level 3 -
Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund's own assumptions about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available.
The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities.
The following is a summary of inputs used as of December 31, 2010 in valuing the Fund’s investments carried at value:
Investments in Securities | Level 1 | Level 2 | Level 3 | Total |
|
|
|
|
|
Common Stocks | $ 3,978,665 | - | - | $ 3,978,665 |
Short-Term Investments: |
|
|
|
|
First American Government Obligation Fund Class Y | 240,042 | - | - | 240,042 |
|
|
|
|
|
| $ 4,218,707 | - | - | $ 4,218,707 |
The accompanying notes are an integral part of these financial statements.
MANOR INVESTMENT FUNDS, INC.
GROWTH FUND
SCHEDULE OF INVESTMENTS
DECEMBER 31, 2010
Shares |
| Value |
|
|
|
COMMON STOCKS - 94.70% |
| |
|
|
|
Beverages - 2.24% |
| |
4,617 | Constellation Brands, Inc. Class A * | $ 102,267 |
|
|
|
Biological Products, (No Diagnostic Substances) - 1.55% |
| |
1,952 | Gilead Sciences, Inc. * | 70,740 |
|
|
|
Bituminous Coal & Lignite Mining - 3.99% |
| |
3,031 | Alpha Natural Resources, Inc. * | 181,951 |
|
|
|
Communications Services - 3.62% |
| |
4,137 | Directv Group, Inc. Class A * | 165,190 |
|
|
|
Crude Petroleum & Natural Gas - 2.02% |
| |
2,463 | Southwestern Energy Co. * | 92,190 |
|
|
|
Electronic Computers - 5.58% |
| |
788 | Apple, Inc. * | 254,177 |
|
|
|
Engines & Turbines - 5.64% |
| |
2,338 | Cummins, Inc. | 257,203 |
|
|
|
Fire, Marine & Casualty Insurance - 3.42% |
| |
2,505 | Ace Ltd. | 155,936 |
|
|
|
Iron & Steel Foundries - 4.16% |
| |
1,362 | Precision Castparts Corp. | 189,604 |
|
|
|
Leather & Leather Products - 3.16% |
| |
2,604 | Coach, Inc. | 144,027 |
|
|
|
Measuring & Controlling Devices - 3.64% |
| |
2,995 | Thermo Fisher Scientific, Inc. * | 165,803 |
* Non-income producing securities during the period.
The accompanying notes are an integral part of these financial statements.
MANOR INVESTMENT FUNDS, INC.
GROWTH FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
DECEMBER 31, 2010
Shares |
| Value |
|
|
|
Oil & Gas Field Services - 2.65% |
| |
1,446 | Schlumberger Ltd. | 120,741 |
|
|
|
Optical Instruments & Lenses - 2.23% |
| |
2,630 | KLA Tencor Corp. | 101,623 |
|
|
|
Petroleum Refining - 3.78% |
| |
2,254 | Hess Corp. | 172,521 |
|
|
|
Pharmaceutical Preparations - 4.08% |
| |
1,341 | Celgene Corp. * | 79,307 |
2,225 | Abbott Laboratories | 106,600 |
|
| 185,907 |
Retail-Drug Stores & Proprietary Stores - 4.03% |
| |
3,402 | Express Scripts, Inc. Class A * | 183,878 |
|
|
|
Retail-Family Clothing Stores - 3.15% |
| |
4,012 | Urban Outfitters, Inc. * | 143,670 |
|
|
|
Retail-Variety Stores - 3.96% |
| |
3,220 | Dollar Tree, Inc. * | 180,578 |
|
|
|
Search, Detection, Navigation, Guidance, Aeronautical Systems - 7.52% | ||
4,000 | Flir Systems, Inc. * | 119,000 |
2,239 | Harris Corp. | 101,427 |
2,645 | Raytheon Co. | 122,569 |
|
| 342,996 |
Semiconductors & Related Devices - 7.25% |
| |
3,704 | Intel Corp. | 77,895 |
3,960 | Texas Instruments, Inc. | 128,700 |
4,278 | Xilinx, Inc. | 123,976 |
|
| 330,571 |
Services-Business Services - 2.76% |
| |
561 | Mastercard, Inc. | 125,726 |
* Non-income producing securities during the period.
The accompanying notes are an integral part of these financial statements.
MANOR INVESTMENT FUNDS, INC.
GROWTH FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
DECEMBER 31, 2010
Shares |
| Value |
|
|
|
Services-Educational Services - 2.07% |
| |
1,964 | Devry, Inc. | 94,233 |
|
|
|
Services-Prepackaged Software - 6.46% |
| |
3,548 | Microsoft Corp. | 99,025 |
6,245 | Oracle Corp. | 195,469 |
|
| 294,494 |
Soap, Detergents, Cleaning Preparations, Perfumes, Cosmetics - 5.74% | ||
1,757 | Church & Dwight Co., Inc. | 121,268 |
2,181 | Procter & Gamble Co. | 140,304 |
|
| 261,572 |
|
|
|
TOTAL FOR COMMON STOCKS (Cost $3,415,881) - 94.70% | 4,317,598 | |
|
|
|
SHORT TERM INVESTMENTS - 5.46% |
| |
44,762 | Fidelity Money Market Portfolio Class Select 0.17% ** (Cost $44,762) | 44,762 |
204,153 | First American Government Obligation Fund Class Y 0.00% ** (Cost $204,153) | 204,153 |
TOTAL FOR SHORT TERM INVESTMENTS | 248,915 | |
|
|
|
TOTAL INVESTMENTS (Cost $3,664,796) - 100.16% | 4,566,513 | |
|
|
|
LIABILITIES IN EXCESS OF OTHER ASSETS - (0.16)% | (7,439) | |
|
|
|
NET ASSETS - 100.00% | $ 4,559,074 | |
** Variable rate security; the coupon rate shown represents the yield at December 31, 2010.
The accompanying notes are an integral part of these financial statements.
MANOR INVESTMENT FUNDS, INC.
GROWTH FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
DECEMBER 31, 2010
Various inputs are used in determining the value of the Fund's investments. These inputs are summarized in the three broad levels listed below:
Level 1 -
Unadjusted quoted prices in active markets for identical assets or liabilities that the Fund has the ability to access.
Level 2 -
Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an active market, price for similar instruments, interest rates, prepayment speeds, yield curves, default rates and similar data.
Level 3 -
Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund's own assumptions about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available.
The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities.
The following is a summary of inputs used as of December 31, 2010 in valuing the Fund’s investments carried at value:
Investments in Securities | Level 1 | Level 2 | Level 3 | Total |
|
|
|
|
|
Common Stocks | $ 4,317,598 | - | - | $ 4,317,598 |
Short-Term Investments: |
|
|
|
|
Fidelity Money Market Portfolio Class Select | 44,762 |
|
| 44,762 |
First American Government Obligation Fund Class Y | 204,153 | - | - | 204,153 |
| $ 4,566,513 | - | - | $ 4,566,513 |
The accompanying notes are an integral part of these financial statements.
MANOR INVESTMENT FUNDS, INC.
BOND FUND
SCHEDULE OF INVESTMENTS
DECEMBER 31, 2010
Face Amount | Value | |
|
|
|
US TREASURY NOTES - 84.99% |
| |
250,000 | US Treasury Note 0.75% Due 11/30/2011 | $ 250,976 |
300,000 | US Treasury Note 0.875% Due 02/28/2011 | 300,281 |
250,000 | US Treasury Note .875% Due 03/31/2011 | 250,391 |
350,000 | US Treasury Note 1.25% Due 10/31/2015 | 338,680 |
475,000 | US Treasury Note 1.375% Due 04/15/2012 | 481,011 |
200,000 | US Treasury Note 3.875% Due 02/15/2013 | 213,688 |
200,000 | US Treasury Note 4.000% Due 02/15/2014 | 217,844 |
|
|
|
TOTAL FOR US TREASURY NOTES (Cost $2,014,334) - 84.99% | 2,052,871 | |
|
|
|
SHORT TERM INVESTMENTS - 14.79% |
| |
357,190 | First American Treasury Obligation Class Y 0.00% ** (Cost $357,190) | 357,190 |
|
|
|
TOTAL INVESTMENTS (Cost $2,371,524) - 99.78% | 2,410,061 | |
|
|
|
OTHER ASSETS LESS LIABILITIES - 0.22% | 5,458 | |
|
|
|
NET ASSETS - 100.00% | $ 2,415,519 | |
|
|
|
** Variable rate security; the coupon rate shown represents the yield at December 31, 2010.
The accompanying notes are an integral part of these financial statements.
MANOR INVESTMENT FUNDS, INC.
BOND FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
DECEMBER 31, 2010
Various inputs are used in determining the value of the Fund's investments. These inputs are summarized in the three broad levels listed below:
Level 1 -
Unadjusted quoted prices in active markets for identical assets or liabilities that the Fund has the ability to access.
Level 2 -
Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an active market, price for similar instruments, interest rates, prepayment speeds, yield curves, default rates and similar data.
Level 3 -
Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund's own assumptions about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available.
The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities.
The following is a summary of inputs used as of December 31, 2010 in valuing the Fund’s investments carried at value:
Investments in Securities | Level 1 | Level 2 | Level 3 | Total |
|
|
|
|
|
US Treasury Notes | $ 2,052,871 | - | - | $ 2,052,871 |
Short-Term Investments: |
|
|
|
|
First American Treasury Obligation Class Y | 357,190 | - | - | 357,190 |
|
|
|
|
|
| $ 2,410,061 | - | - | $ 2,410,061 |
The accompanying notes are an integral part of these financial statements.
MANOR INVESTMENT FUNDS, INC.
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 2010
Assets: |
| Manor Fund | Growth Fund | Bond Fund |
Investments in Securities, at Value |
|
|
| |
(Cost $3,285,713, $3,664,796, and $2,371,524, respectively) | $ 4,218,707 | $ 4,566,513 | $ 2,410,061 | |
Cash |
| 11,800 | - | - |
Receivables: |
|
|
| |
Dividends and Interest | 6,465 | 2,023 | 9,668 | |
Due from Advisor | 1,060 | - | 3,308 | |
Prepaid Expenses | 1,684 | 1,523 | 1,252 | |
Total Assets | 4,239,716 | 4,570,059 | 2,424,289 | |
Liabilities: |
|
|
|
|
Payables: |
|
|
| |
Due to Advisor | - | 442 | - | |
Accrued Expenses | 9,235 | 10,543 | 8,770 | |
Total Liabilities | 9,235 | 10,985 | 8,770 | |
Net Assets |
| $ 4,230,481 | $ 4,559,074 | $ 2,415,519 |
|
|
|
|
|
Net Assets Consist of: |
|
|
| |
Capital Stock | $ 247 | $ 384 | $ 226 | |
Paid In Capital | 3,621,412 | 4,101,904 | 2,376,756 | |
Accumulated Realized Loss on Investments | (324,172) | (444,931) | - | |
Unrealized Appreciation in Value of Investments | 932,994 | 901,717 | 38,537 | |
Net Assets (10,000,000 shares authorized, $0.001 par value) for 247,238, 383,960, and 226,382 shares outstanding, respectively. |
|
|
| |
$ 4,230,481 | $ 4,559,074 | $ 2,415,519 | ||
|
|
|
|
|
Net Asset Value and Offering Price Per Share | $ 17.11 | $ 11.87 | $ 10.67 | |
The accompanying notes are an integral part of these financial statements.
MANOR INVESTMENT FUNDS, INC.
STATEMENT OF OPERATIONS
DECEMBER 31, 2010
|
| Manor Fund | Growth Fund | Bond Fund |
Investment Income: |
|
|
| |
Dividends | $ 67,472 | $ 36,838 | $ - | |
Interest | - | - | 33,121 | |
Total Investment Income | 67,472 | 36,838 | 33,121 | |
|
|
|
|
|
Expenses: |
|
|
|
|
Advisory Fees (Note 2) | 38,191 | 39,878 | 10,831 | |
Transfer Agent and Fund Accounting Fees | 8,997 | 8,997 | 8,997 | |
Insurance Fees | 1,095 | 1,095 | 365 | |
Audit Fees | 8,030 | 10,220 | 4,745 | |
Blue Sky Fees | 430 | 1,160 | 140 | |
Custody Fees | 4,745 | 3,285 | 2,920 | |
Printing and Mailing Fees | 1,460 | 2,920 | 365 | |
Taxes | 300 | 300 | 225 | |
Quotes and Fees | 883 | 913 | 462 | |
Miscellaneous Fees | 1,672 | 1,277 | 268 | |
Total Expenses | 65,803 | 70,045 | 29,318 | |
Fees Waived and Reimbursed by the Advisor (Note 2) | (8,517) | (10,228) | (7,657) | |
Net Expenses | 57,286 | 59,817 | 21,661 | |
|
|
|
|
|
Net Investment Income (Loss) | 10,186 | (22,979) | 11,460 | |
|
|
|
|
|
Realized and Unrealized Gain (Loss) on Investments: |
|
|
| |
Realized Gain (Loss) on Investments | 25,173 | (61,462) | 5,278 | |
Net Change in Unrealized Appreciation on Investments | 440,503 | 793,860 | 36 | |
Net Realized and Unrealized Gain on Investments | 465,676 | 732,398 | 5,314 | |
|
|
|
|
|
Net Increase in Net Assets Resulting from Operations | $ 475,862 | $ 709,419 | $ 16,774 | |
The accompanying notes are an integral part of these financial statements.
MANOR INVESTMENT FUNDS, INC.
MANOR FUND
STATEMENTS OF CHANGES IN NET ASSETS
|
| For the Years Ended | |
|
| 12/31/2010 | 12/31/2009 |
Increase (Decrease) in Net Assets From Operations: |
|
| |
Net Investment Income | $ 10,186 | $ 23,106 | |
Net Realized Gain (Loss) on Investments | 25,173 | (307,988) | |
Net Change in Unrealized Appreciation on Investments | 440,503 | 1,021,521 | |
Net Increase in Net Assets Resulting from Operations | 475,862 | 736,639 | |
|
|
|
|
Distributions to Shareholders from: |
|
| |
Net Investment Income | (10,183) | (23,101) | |
Realized Gains | - | - | |
Total Distributions | (10,183) | (23,101) | |
|
|
|
|
Capital Share Transactions: |
|
| |
Proceeds from Sold Shares | 384,492 | 485,683 | |
Reinvestment of Distributions | 10,004 | 22,792 | |
Cost of Shares Redeemed | (429,971) | (391,381) | |
Net Increase (Decrease) from Capital Shares Transactions | (35,475) | 117,094 | |
|
|
|
|
Total Increase | 430,204 | 830,632 | |
|
|
|
|
Net Assets |
|
| |
Beginning of Period | 3,800,277 | 2,969,645 | |
End of Period (Including Accumulated Undistributed Net |
|
| |
Investment Income of $0 and $0, respectively) | $ 4,230,481 | $ 3,800,277 | |
|
|
|
|
Share Transactions: |
|
| |
Shares Sold | 23,993 | 38,004 | |
Shares Issued on Reinvestment of Distributions | 585 | 1,496 | |
Shares Redeemed | (28,375) | (35,743) | |
Net Increase (Decrease) in Outstanding Shares of Fund | (3,797) | 3,757 | |
The accompanying notes are an integral part of these financial statements.
MANOR INVESTMENT FUNDS, INC.
GROWTH FUND
STATEMENTS OF CHANGES IN NET ASSETS
|
| For the Years Ended | |
| 12/31/2010 | 12/31/2009 | |
Increase (Decrease) in Net Assets From Operations: |
|
| |
Net Investment Loss | $ (22,979) | $ (13,837) | |
Net Realized Loss on Investments | (61,462) | (183,541) | |
Net Change in Unrealized Appreciation on Investments | 793,860 | 1,231,766 | |
Net Increase in Net Assets Resulting from Operations | 709,419 | 1,034,388 | |
|
|
|
|
Distributions to Shareholders from: |
|
| |
Net Investment Income | - | - | |
Realized Gains | - | - | |
Total Distributions | - | - | |
|
|
|
|
Capital Share Transactions: |
|
| |
Proceeds from Sold Shares | 480,964 | 498,215 | |
Reinvestment of Distributions | - | - | |
Cost of Shares Redeemed | (432,664) | (489,795) | |
Net Increase from Capital Shares Transactions | 48,300 | 8,420 | |
|
|
|
|
Total Increase | 757,719 | 1,042,808 | |
|
|
|
|
Net Assets |
|
| |
Beginning of Period | 3,801,355 | 2,758,547 | |
End of Period (Including Accumulated Undistributed Net |
|
| |
Investment Income of $0 and $0, respectively) | $ 4,559,074 | $ 3,801,355 | |
|
|
|
|
Share Transactions: |
|
| |
Shares Sold | 43,481 | 65,283 | |
Shares Issued on Reinvestment of Distributions | - | - | |
Shares Redeemed | (41,017) | (69,034) | |
Net Increase (Decrease) in Outstanding Shares of Fund | 2,464 | (3,751) | |
The accompanying notes are an integral part of these financial statements.
MANOR INVESTMENT FUNDS, INC.
BOND FUND
STATEMENTS OF CHANGES IN NET ASSETS
|
| For the Years Ended | |
| 12/31/2010 | 12/31/2009 | |
Increase (Decrease) in Net Assets From Operations: |
|
| |
Net Investment Income | $ 11,460 | $ 28,796 | |
Net Realized Gain on Investments | 5,278 | 134 | |
Net Change in Unrealized Appreciation (Depreciation) on Investments | 36 | (45,475) | |
Net Increase (Decrease) in Net Assets Resulting from Operations | 16,774 | (16,545) | |
|
|
|
|
Distributions to Shareholders from: |
|
| |
Net Investment Income | (12,538) | (28,706) | |
Realized Gains | (3,273) | (134) | |
Total Distributions | (15,811) | (28,840) | |
|
|
|
|
Capital Share Transactions: |
|
| |
Proceeds from Sold Shares | 681,871 | 482,103 | |
Shares Issued on Reinvestment of Distributions | 15,811 | 28,840 | |
Cost of Shares Redeemed | (318,602) | (725,023) | |
Net Increase (Decrease) from Capital Share Transactions | 379,080 | (214,080) | |
|
|
|
|
Total Increase (Decrease) | 380,043 | (259,465) | |
|
|
|
|
Net Assets |
|
| |
Beginning of Period | 2,035,476 | 2,294,941 | |
End of Period (Including Accumulated Undistributed Net |
|
| |
Investment Income of $0 and $0, respectively) | $ 2,415,519 | $ 2,035,476 | |
|
|
|
|
Share Transactions: |
|
| |
Shares Sold | 63,557 | 44,528 | |
Shares Issued on Reinvestment of Distributions | 1,482 | 2,705 | |
Shares Redeemed | (29,732) | (66,953) | |
Net Increase (Decrease) in Outstanding Shares of Fund | 35,307 | (19,720) | |
The accompanying notes are an integral part of these financial statements.
MANOR INVESTMENT FUNDS, INC.
MANOR FUND
FINANCIAL HIGHLIGHTS
Selected data for a share outstanding throughout the period.
|
| Years Ended | ||||
|
| 12/31/ 2010 | 12/31/ 2009 | 12/31/ 2008 | 12/31/ 2007 | 12/31/ 2006 |
|
|
|
|
|
|
|
Net Asset Value, at Beginning of Period | $ 15.14 | $ 12.01 | $ 17.58 | $ 17.54 | $ 17.32 | |
|
|
|
|
|
|
|
Income From Investment Operations: |
|
|
|
|
| |
Net Investment Income * | 0.04 | 0.10 | 0.04 | 0.05 | 0.15 | |
Net Gain (Loss) on Securities (Realized and Unrealized) | 1.97 | 3.12 | (5.57) | 0.72 | 1.46 | |
Total from Investment Operations | 2.01 | 3.22 | (5.53) | 0.77 | 1.61 | |
|
|
|
|
|
|
|
Distributions: |
|
|
|
|
| |
Net Investment Income | (0.04) | (0.09) | (0.04) | (0.08) | (0.04) | |
Realized Gains | - | - | - | (0.65) | (1.35) | |
Total from Distributions | (0.04) | (0.09) | (0.04) | (0.73) | (1.39) | |
|
|
|
|
|
|
|
Net Asset Value, at End of Period | $ 17.11 | $ 15.14 | $ 12.01 | $ 17.58 | $ 17.54 | |
|
|
|
|
|
|
|
Total Return ** | 13.29% | 26.83% | (31.42)% | 4.24% | 9.31% | |
|
|
|
|
|
|
|
Ratios/Supplemental Data: |
|
|
|
|
| |
Net Assets at End of Period (Thousands) | $ 4,230 | $ 3,800 | $ 2,970 | $ 4,376 | $ 3,954 | |
Before Waivers |
|
|
|
|
| |
Ratio of Expenses to Average Net Assets | 1.72% | 1.86% | 1.95% | 1.58% | 1.50% | |
After Waivers |
|
|
|
|
| |
Ratio of Expenses to Average Net Assets | 1.50% | 1.50% | 1.50% | 1.50% | 1.50% | |
Ratio of Net Investment Income to Average Net Assets | 0.27% | 0.74% | 0.26% | 0.25% | 0.23% | |
Portfolio Turnover | 3.20% | 9.59% | 15.68% | 12.09% | 24.95% | |
* Per share net investment income has been determined on the basis of average shares outstanding during the period.
** Total return in the above table represents the rate that the investor would have earned or lost on an investment in the Fund assuming reinvestment of dividends.
The accompanying notes are an integral part of these financial statements.
MANOR INVESTMENT FUNDS, INC.
GROWTH FUND
FINANCIAL HIGHLIGHTS
Selected data for a share outstanding throughout the period.
|
| Years Ended | ||||
|
| 12/31/ 2010 | 12/31/ 2009 | 12/31/ 2008 | 12/31/ 2007 | 12/31/ 2006 |
|
|
|
|
|
|
|
Net Asset Value, at Beginning of Period | $ 9.96 | $ 7.16 | $ 12.16 | $ 11.78 | $ 11.27 | |
|
|
|
|
|
|
|
Income From Investment Operations: |
|
|
|
|
| |
Net Investment Loss * | (0.06) | (0.03) | (0.07) | (0.09) | (0.07) | |
Net Gain (Loss) on Securities (Realized and Unrealized) | 1.97 | 2.83 | (4.93) | 0.84 | 0.58 | |
Total from Investment Operations | 1.91 | 2.80 | (5.00) | 0.75 | 0.51 | |
|
|
|
|
|
|
|
Distributions: |
|
|
|
|
|
|
Net Investment Income | - | - | - | - | - | |
Realized Gains | - | - | - | (0.37) | - | |
Total from Distributions | - | - | - | (0.37) | - | |
|
|
|
|
|
|
|
Net Asset Value, at End of Period | $ 11.87 | $ 9.96 | $ 7.16 | $ 12.16 | $ 11.78 | |
|
|
|
|
|
|
|
Total Return ** | 19.18% | 39.11% | (41.12)% | 6.28% | 4.53% | |
|
|
|
|
|
|
|
Ratios/Supplemental Data: |
|
|
|
|
| |
Net Assets at End of Period (Thousands) | $ 4,559 | $ 3,801 | $ 2,759 | $ 5,587 | $ 4,474 | |
Before Waivers |
|
|
|
|
| |
Ratio of Expenses to Average Net Assets | 1.76% | 1.85% | 1.82% | 1.59% | 1.53% | |
After Waivers and Reimbursements |
|
|
|
|
| |
Ratio of Expenses to Average Net Assets | 1.50% | 1.50% | 1.50% | 1.50% | 1.49% | |
Ratio of Net Investment Loss to Average Net Assets | (0.58)% | (0.44)% | (0.68)% | (0.73)% | (0.67)% | |
Portfolio Turnover | 9.86% | 19.01% | 28.66% | 25.76% | 24.78% | |
* Per share net investment loss has been determined on the basis of average shares outstanding during the period.
** Total return in the above table represents the rate that the investor would have earned or lost on an investment in the Fund assuming reinvestment of dividends.
The accompanying notes are an integral part of these financial statements.
MANOR INVESTMENT FUNDS, INC.
BOND FUND
FINANCIAL HIGHLIGHTS
Selected data for a share outstanding throughout the period.
|
| Years Ended | ||||
|
| 12/31/ 2010 | 12/31/ 2009 | 12/31/ 2008 | 12/31/ 2007 | 12/31/ 2006 |
|
|
|
|
|
|
|
Net Asset Value, at Beginning of Period | $ 10.65 | $ 10.89 | $ 10.54 | $ 10.17 | $ 10.23 | |
|
|
|
|
|
|
|
Income From Investment Operations: |
|
|
|
|
| |
Net Investment Income * | 0.06 | 0.14 | 0.23 | 0.27 | 0.30 | |
Net Gain (Loss) on Securities (Realized and Unrealized) | 0.03 | (0.23) | 0.32 | 0.38 | (0.06) | |
Total from Investment Operations | 0.09 | (0.09) | 0.55 | 0.65 | 0.24 | |
|
|
|
|
|
|
|
Distributions: |
|
|
|
|
|
|
Net Investment Income | (0.06) | (0.15) | (0.20) | (0.28) | (0.30) | |
Realized Gains | (0.01) | - | - | - | - | |
Total from Distributions | (0.07) | (0.15) | (0.20) | (0.28) | (0.30) | |
|
|
|
|
|
|
|
Net Asset Value, at End of Period | $ 10.67 | $ 10.65 | $ 10.89 | $ 10.54 | $ 10.17 | |
|
|
|
|
|
|
|
Total Return ** | 0.85% | (0.80)% | 5.20% | 6.50% | 2.32% | |
|
|
|
|
|
|
|
Ratios/Supplemental Data: |
|
|
|
|
| |
Net Assets at End of Period (Thousands) | $ 2,416 | $ 2,035 | $ 2,295 | $ 1,884 | $ 1,903 | |
Before Waivers |
|
|
|
|
| |
Ratio of Expenses to Average Net Assets | 1.35% | 1.46% | 2.02% | 1.03% | 0.99% | |
After Waivers and Reimbursements |
|
|
|
|
| |
Ratio of Expenses to Average Net Assets | 1.00% | 1.00% | 1.00% | 1.00% | 0.99% | |
Ratio of Net Investment Income to Average Net Assets | 0.53% | 1.26% | 2.08% | 2.71% | 2.70% | |
Portfolio Turnover | 41.12% | 29.87% | 13.55% | 0.00% | 0.00% | |
* Per share net investment income has been determined on the basis of average shares outstanding during the period.
** Total return in the above table represents the rate that the investor would have earned or lost on an investment in the Fund assuming reinvestment of dividends.
The accompanying notes are an integral part of these financial statements.
MANOR INVESTMENT FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2010
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
Organization: Manor Investment Funds, Inc. (the “Company”) is a non-diversified regulated investment company and was incorporated in the Commonwealth of Pennsylvania on September 13, 1995. The primary investment objective of each of the Funds follows: Manor Fund - conservative capital appreciation and current income, investing primarily in common stocks of large corporations in the United States; Growth Fund - long-term capital appreciation, investing primarily in common stocks of U.S. corporations; Bond Fund - intermediate-term fixed income, investing primarily in U.S. Government obligations.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements. These policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”).
Security Valuations: Equity securities generally are valued by using market quotations, but may be valued on the basis of prices furnished by a pricing service when the Advisor believes such prices accurately reflect the fair market value of such securities. Securities that are traded on any stock exchange or on the NASDAQ over-the-counter market are generally valued by the pricing service at the last quoted sale price. Lacking a last sale price, an equity security is generally valued by the pricing service at its last bid price. When market quotations are not readily available, when the Advisor determines that the market quotation or the price provided by the pricing service does not accurately reflect the current market value, or when restricted or illiquid securities are being valued, such securities are valued as determined in good faith by the Board of Directors. The Board has adopted guidelines for good faith pricing, and has delegated to the Advisor the responsibility for determining fair value prices, subject to review by the Board of Directors.
Fixed income securities generally are valued by using market quotations, but may be valued on the basis of prices furnished by a pricing service when the Advisor believes such prices accurately reflect the fair market value of such securities. A pricing service utilizes electronic data processing techniques based on yield spreads relating to securities with similar characteristics to determine prices for normal institutional-size trading units of debt securities without regard to sale or bid prices.
MANOR INVESTMENT FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 2010
If the Advisor decides that a price provided by the pricing service does not accurately reflect the fair market value of the securities, when prices are not readily available from a pricing service, or when restricted or illiquid securities are being valued, securities are valued at fair value as determined in good faith by the Advisor, subject to review by the Board of Directors. Short term investments in fixed income securities with maturities of less than 60 days when acquired, or which subsequently are within 60 days of maturity, are valued by using the amortized cost method of valuation, which the Board has determined will represent fair value.
Federal Income Taxes: The Funds policy is to comply with the requirements of the Internal Revenue Code that are applicable to regulated investment companies and to distribute all its taxable income to its shareholders. Therefore, no federal income tax provision is required.
In addition, GAAP requires management of the Funds to analyze all open tax years, fiscal years 2007-2010, as defined by IRS statue of limitations for all major industries, including federal tax authorities and certain state tax authorities. As of and during the year ended December 31, 2010, the Funds did not have a liability for any unrecognized tax benefits. The Funds have no examination in progress and are not aware of any tax positions for which it is reasonably possible that the total tax amounts of unrecognized tax benefits will significantly change in the next twelve months.
Distributions to Shareholders: The Funds intend to distribute to its shareholders substantially all of its net realized capital gains and net investment income, if any, at year-end. Distributions will be recorded on ex-dividend date.
Other: The Funds follow industry practice and record security transactions on the trade date. The specific identification method is used for determining gains or losses for financial statements and income tax purposes. Dividend income is recorded on the ex-dividend date and interest income is recorded on an accrual basis. Discounts and premiums are amortized over the useful lives of the respective securities when determined to be material. Withholding taxes on foreign dividends will be provided for in accordance with the Funds’ understanding of the applicable country’s tax rules and rates.
MANOR INVESTMENT FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 2010
Use of Estimates: The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from these estimates.
Reclassifications: In accordance with GAAP, the Growth Fund recorded a permanent book/tax difference of $22,979 from net investment loss to paid-in-capital. This reclassification has no impact on the net asset value of the Fund and is designed generally to present undistributed income and net realized gains on a tax basis, which is considered to be more informative to shareholders.
Subsequent Events - Management has evaluated the impact of all subsequent events through the date the financial statements were issued and has determined that there were no subsequent events requiring recognition or disclosure in these financial statements.
2. INVESTMENT ADVISORY AGREEMENT
The Company has an investment advisory agreement (the “agreement”) with Morris Capital Advisors, Inc. (the “Advisor”), with whom certain officers and directors of the Funds are affiliated, to furnish investment management services to the Funds. Under the terms of the agreement, the Funds will pay the Advisor a monthly fee based on the Funds’ average daily net assets at the annual rate of 1.00% for Manor Fund and Growth Fund and 0.5% for Bond Fund. For the year ended December 31, 2010, the Advisor earned advisory fees from the Manor, Growth and Bond Funds of $38,191, $39,878 and $10,831, respectively.
Under the terms of the agreement if the aggregate expenses of the Funds are equal to or greater than 1.50% for Manor Fund and Growth Fund and 1.00% for Bond Fund of the Funds’ net assets the Advisor will reimburse the Funds for these expenses. The reimbursements from the Advisor for the Manor, Growth and Bond Funds for the year ended December 31, 2010 were, $8,517, $10,228, and $7,657, respectively. As of December 31, 2010, the Fund owed the Advisor $442 for the Growth Fund. As of December 31, 2010, the Advisor owed the Manor Fund $1,060 and $3,308 for the Bond Fund.
MANOR INVESTMENT FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 2010
3. INVESTMENT TRANSACTIONS
Investment transactions, excluding short-term investments, for the year ended December 31, 2010, were as follows:
Manor Fund
Growth Fund
Bond Fund
Purchases
$ 120,603
$ 372,054
$ 1,091,068
Sales
$ 113,960
$ 487,144
$ 826,581
4. FEDERAL INCOME TAXES
As of December 31, 2010, the tax basis components of distributable earnings, unrealized appreciation (depreciation) and cost of investment securities were as follows:
Manor Fund
Growth Fund
Bond Fund
Federal tax cost of investments,
including short-term investments
$ 3,285,713
$ 3,664,796
$ 2,371,524
Gross tax appreciation of investments
$ 1,081,449
$ 1,094,153
$ 38,537
Gross tax depreciation of investments
$ (148,455)
$( 192,436)
$ 0
Net tax appreciation
$ 932,994
$ 901,717
$ 38,357
Capital loss carry-forwards +
$ (324,172)
$ (444,931)
$ 0
The accumulated capital loss carry-forwards as of December 31, 2010 expire as follows:
Manor Fund
Growth Fund
Bond Fund
2016
$( 16,184)
$(199,928)
$ —
2017
$ (307,988)
$(183,541)
$ —
2018
$ —
$( 61,462)
$ —
+ The capital loss carry-forwards will be used to offset any capital gains realized by the Funds in future years through the expiration dates. The Funds will not make distributions from capital gains while a capital loss carry-forward remains.
MANOR INVESTMENT FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 2010
Income and long-term capital gain distributions are determined in accordance with Federal income tax regulations, which may differ from accounting principals generally accepted in the United States
The tax character of distributions paid during the years ended December 31, 2010 and December 31, 2009 were as follows:
Manor Fund
Growth Fund
Bond Fund
2010 2009
2010 2009
2010 2009
Ordinary Income (Loss) $10,183 $23,101
$ — $ — $12,538 $28,840
Long-term Gain (Loss) $ — $ —
$ — $ — $ 3,273 $ —
5. NEW ACCOUNTING PRNOUNCEMENT
In January 2010, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2010-06 “Improving Disclosures about Fair Value Measurements”. ASU No. 2010-06 amends FASB Accounting Standards Codification Topic 820, Fair Value Measurements and Disclosures, to require additional disclosures regarding fair value measurements. Certain disclosures required by ASU No. 2010-06 are effective for interim and annual periods beginning after December 15, 2009, and other required disclosures are effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years. Management is currently evaluating the impact ASU 2010-06 will have on the Funds’ financial statement disclosures.
MANOR INVESTMENT FUNDS, INC.
AUDITOR OPINION
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and Board of Directors
of the Manor Investment Funds, Inc.
We have audited the accompanying statements of assets and liabilities of Manor Fund, Growth Fund and Bond Fund (collectively the “Funds”), the funds comprising the Manor Investment Funds, Inc., including the schedules of investments, as of December 31, 2010 and the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Funds' management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 31, 2010, by correspondence with the custodian and brokers. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial positions of the Funds as of December 31, 2010, the results of their operations for the year then ended, the changes in their net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.
Abington, Pennsylvania![[annual015.jpg]](annual015.jpg)
February 28, 2011
MANOR INVESTMENT FUNDS, INC.
EXPENSE ILLUSTRATION
DECEMBER 31, 2010 (UNAUDITED)
Expense Example
As a shareholder of Manor Investment Funds, you incur ongoing costs which consist of management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period, July 1, 2010 through December 31, 2010.
Actual Expenses
The first line of the table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line of the table below provides information about hypothetical account values and hypothetical expenses based on each Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in these Funds and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
MANOR INVESTMENT FUNDS, INC.
EXPENSE ILLUSTRATION (CONTINUED)
DECEMBER 31, 2010 (UNAUDITED)
|
| Manor Fund |
|
| Beginning Account Value | Ending Account Value | Expenses Paid During the Period* |
| July 1, 2010 | December 31, 2010 | July 1, 2010 to December 31, 2010 |
|
|
|
|
Actual | $1,000.00 | $1,195.22 | $8.30 |
Hypothetical |
|
|
|
(5% Annual Return before expenses) | $1,000.00 | $1,017.64 | $7.63 |
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|
|
* Expenses are equal to the Fund's annualized expense ratio of 1.50%, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). | |||
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|
| Growth Fund |
|
| Beginning Account Value | Ending Account Value | Expenses Paid During the Period* |
| July 1, 2010 | December 31, 2010 | July 1, 2010 to December 31, 2010 |
|
|
|
|
Actual | $1,000.00 | $1,209.99 | $8.36 |
Hypothetical |
|
|
|
(5% Annual Return before expenses) | $1,000.00 | $1,017.64 | $7.63 |
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|
* Expenses are equal to the Fund's annualized expense ratio of 1.50%, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). | |||
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| Bond Fund |
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| Beginning Account Value | Ending Account Value | Expenses Paid During the Period* |
| July 1, 2010 | December 31, 2010 | July 1, 2010 to December 31, 2010 |
|
|
|
|
Actual | $1,000.00 | $999.11 | $5.04 |
Hypothetical |
|
|
|
(5% Annual Return before expenses) | $1,000.00 | $1,020.16 | $5.09 |
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|
* Expenses are equal to the Fund's annualized expense ratio of 1.00%, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). | |||
MANOR INVESTMENT FUNDS, INC.
ADDITIONAL INFORMATION
DECEMBER 31, 2010 (UNAUDITED)
Proxy Voting Procedures
The Company’s Board of Directors has approved proxy voting procedures for the voting of proxies relating to securities held by the Fund. Records of the Fund’s proxy voting records are maintained and are available for inspection. The Board is responsible for overseeing the implementation of the procedures. The proxy voting record of the Fund can be reviewed on the web site of the Fund at www.ManorFunds.com. The Proxy voting history is located under Fund Information, Proxy Voting.
Quarterly Portfolio Schedule
The Company now files a complete schedule of investments with the SEC for the first and third quarters of each fiscal year on Form N-Q. These forms are available on the SEC’S website at http://www.sec.gov. They may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling 1-800-723-0330.
Compensation of Board of Directors
The members of the Board of Directors serve without compensation. Daniel A. Morris, President of Manor Investment Funds, Inc. (“the Funds”), and President of Morris Capital Advisors, LLC, adviser to the Funds, and an Interested Director of the Funds, receives no compensation directly from the Funds. He is compensated through the management fee paid to the adviser by the Funds. The business and affairs of the Fund are managed under the direction of the Funds’ Board of Directors. Information pertaining to the Directors of the Fund are set forth below. The Statement of Additional Information includes additional information about the Funds’ Directors, and is available without charge, by calling 1-800-787-3334. Each director may be contacted by writing to the director c/o Manor Investment Funds, Inc., 15 Chester Commons, Malvern, PA 19355.
MANOR INVESTMENT FUNDS, INC.
ADDITIONAL INFORMATION (CONTINUED)
DECEMBER 31, 2010 (UNAUDITED)
Advisory Renewal Agreement
At a Board meeting held on June 21, 2010, the Advisory Renewal Agreement was approved. Morris Capital Advisors, LLC (MCA) provides ongoing investment management for the portfolio of each Fund. In the execution of these duties MCA performs securities research, trading, and accounting for Fund portfolios. MCA also reconciles each portfolio with the Fund custodian to prevent errors in purchase and sale transactions, dividends, interest, and shareholder transactions.
The investment performance of each Fund is compared to a broad market index and comparable mutual funds. As of December 31, 2009 the Manor Fund outperformed the S&P 500 index during the trailing 1-year, 3-year, and 5-year periods. The Fund also outperformed the Lipper Large-Cap Core mutual fund index during the most recent quarter, trailing 3-year, and trailing 5-years. As of December 31, 2009 the Growth Fund outperformed the Lipper Large-Cap Growth mutual fund index during the most recent quarter, trailing year, and since inception. The Growth Fund also outperformed the S&P 500 index during the most recent quarter, trailing 1-year, 3-year and since inception. The Bond Fund outperformed the Lipper Government fund index during the most recent quarter and also outperformed the Barclay Intermediate Govenrment index during the most recent quarter, and trailing year. This portfolio structure of the Bond Fund is designed to protect principal in periods of rising interest rates, and underperformed during the recent period of declining yields.
In addition to investment management functions, MCA handles all compliance responsibilities, monitors and reviews Mutual Shareholder Services, LLC (MSS) as transfer agent and accountant, prepares and distributes all shareholder reports, in conjunction with MSS prepares and submits all filings required by SEC rules and regulations, negotiates agreements with outside service providers, and processes all shareholder questions and requests. MCA provides these services, over and above the typical responsibilities of investment management, without compensation from the Fund. The costs of providing these services substantially reduce the net profit attributable to MCA from the sole execution of its duties under its investment advisory agreement with the Fund.
MANOR INVESTMENT FUNDS, INC.
ADDITIONAL INFORMATION (CONTINUED)
DECEMBER 31, 2010 (UNAUDITED)
During the most recent year the assets under management in the funds rose as income and investment gains offset a slight net outflow. The increase in assets occurred during the latter portion of the year, as reflected by a decline in total advisors fees of 19%. A focus on cost containment and the completion of the Audit accrual “catch-up” reduced the expense reimbursement by the Advisor. All major expense categories declined, or rose only modestly, with the exception of Blue-sky registration (up 361%) and Insurance (up 123%). The increase in each of these categories was largely beyond the control of the Fund. The total expense reimbursement by the Advisor declined by 35% to $32,861, and is likely to decline again this year. The reimbursement of expenses by the Advisor served to maintain the maximum expense ratio of the Manor and Growth fund at 1.50% of net assets, and the Bond Fund at 1.00% of net assets. If assets continue to rebound, economies of scale will reduce the cost of services to the Funds, for the benefit of all Fund shareholders. These costs have increased dramatically over the last several years as the regulatory environment has become increasingly burdensome. It is expected that these increased costs will extend the point where the economies of scale will benefit shareholders, initially estimated to be when Fund assets exceed $25 million.
Additional Information
| Morningstar Mutual Fund Ranking | Fund Operating Expense Ratio | Peer Group Operating Expense Ratio |
Manor Fund | 4 | 1.50 % | 1.11 % |
Growth Fund | 3 | 1.50 % | 1.33 % |
Bond Fund | 1 | 1.00 % | 0.90 % |
MANOR INVESTMENT FUNDS, INC.
DIRECTORS AND OFFICERS
DECEMBER 31, 2010 (UNAUDITED)
The following table provides information regarding each Director who is not an “interested person” of the Trust, as defined in the Investment Company Act of 1940. Each Director serves a one year term, and stands for re-election annually.
Name, Address and Age | Position & Length of Time Served with the Fund | Principal Occupations During Past 5 Years and Current Directorships |
James Klucar 15 Chester Commons Malvern, PA 19355 69 | Director since 2008 | Mr. Klucar is a Nuclear Engineer with Int, Inc. |
Bruce Laverty 15 Chester Commons Malvern, PA 19355 51 | Director since 1995 | Mr. Laverty is a Partner of the law firm Valocchi, Fischer & Laverty. |
John McGinn 15 Chester Commons Malvern, PA 19355 64 | Director since 2002 | Mr. McGinn is an independent real estate sales consultant. |
Fred Myers 15 Chester Commons Malvern, PA 19355 61 | Director since 1995 | Mr. Myers is founding Partner of the accounting firm of Myers & Associates, CPA’s. |
Edward Szkudlapski 15 Chester Commons Malvern, PA 19355 53 | Director since 2000 | Mr. Szkudlapski is President of Eclipse Business Systems. |
Alan Weintraub 15 Chester Commons Malvern, PA 19355 57 | Director since 1995 | Mr. Weintraub is a Chief Technical Officer with Perficient, Austin, TX. |
Howard Weisz 15 Chester Commons Malvern, PA 19355 69 | Director since 2008 | Mr. Weisz is an Independent Management Consultant. |
MANOR INVESTMENT FUNDS, INC.
DIRECTORS AND OFFICERS (CONTINUED)
DECEMBER 31, 2010 (UNAUDITED)
The following table provides information regarding each Director who is an “interested person” of the Fund, as defined in the Investment Company Act of 1940, and each officer of the Fund. Each Director serves a one year term, and stands for re-election annually.
Name, Address, and Age | Position and Length of Time Served with the Fund | Principal Occupations During Past 5 Years and Current Directorships |
Daniel A. Morris 15 Chester Commons Malvern, PA 19355 56 | Director, President, Advisor Since 1995 | Prior to founding Morris Capital Advisors, LLC, he was Senior Vice President of Consistent Asset Management Company, an investment adviser for separate accounts and registered investment companies. |
John R. Giles 15 Chester Commons Malvern, PA 19355 55 | Director, Vice-President, Advisor, Secretary Since 2005 | Prior to joining Morris Capital Advisors, LLC, he was Senior Vice President of the Wilmington Trust Company and Senior Vice President of Consistent Asset Management Company, an investment adviser for separate accounts and registered investment companies. |
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ITEM 2. |
| CODE OF ETHICS. |
The Registrant, as of the end of the period covered by this report, has adopted a code of ethics that applies to the Registrant’s principal executive officer, principal financial officer, principal account officer or controller, or persons performing similar functions. The registrant has not made any amendments to its code of ethics during the covered period. The registrant has not granted any waivers from any provisions of the code of ethics during the covered period.
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ITEM 3. |
| AUDIT COMMITTEE FINANCIAL EXPERT. |
The Registrant’s audit committee consists of two independent directors, Chaired by James McFadden. The Board of Directors has determined that the Registrant has at least three financial experts serving on its Board.
Mr. Daniel Morris, Mr. John Giles, and Mr. Fred Myers are the Board’s financial experts. Mr. Morris and Mr. Giles are “interested” directors, and Mr. Myers is an “independent” director.
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ITEM 4. |
| PRINCIPAL ACCOUNTANT FEES AND SERVICES. |
The registrant has engaged its principal accountant to perform audit services. “Audit services” refer to performing an audit of the registrant’s annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years. “Audit related services” refer to the assurance and related services by the principal accountant that are reasonably related to the performance of the audit. “Tax Services” refer to professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning. The following table details the aggregate fees billed for each of the last two fiscal years for audit fees, audit-related fees, tax fees and other fees by the principal accountant.
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| 12/31/2010 |
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| 12/31/2009 |
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Audit Fees |
| $ | 21,000 |
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| $ | 20,000 |
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Audit Related Fees |
| $ | 0 |
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| $ | 0 |
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Tax Fees |
| $ | 4,500 |
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| $ | 4,500 |
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All Other Fees |
| $ | 0 |
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| $ | 0 |
|
Each year, the registrant’s Board of Directors recommend a principal accountant to perform audit services for the registrant. At the registrant’s Annual Meeting, the shareholders vote to approve or disapprove the principal accountant recommended by the Board.
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ITEM 5. |
| AUDIT COMMITTEE OF LISTED REGISTRANTS. |
Not applicable to open-end investment companies.
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ITEM 6. |
| SCHEDULE OF INVESTMENTS |
Schedule of Investments is included as part of the report to shareholders filed under Item 1 of this form.
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ITEM 7. |
| DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. |
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ITEM 8. |
| [RESERVED.] |
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ITEM 9. |
| CONTROLS AND PROCEDURES. | |||
| a) |
| The registrant’s president and chief financial officer has concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective, as of a date within 90 days of the filing date of the report that includes the disclosure required by this paragraph, based on their evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rules 13-a-15(b) under the Securities Exchange Act of 1934. | ||
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| b) |
| There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act that occurred during the registrant’s second fiscal half-year that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting. | ||
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ITEM 10. |
| EXHIBITS. | |||
| (a)(1) |
| Code of Ethics — For annual reports. | ||
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| (a)(2) |
| Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto. | ||
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| (b) |
| Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 are attached hereto. | ||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Manor Investment Funds, Inc.
By /s/ Daniel A. Morris
President
Date March 7, 2011